Concerns re: Proposed Condo Act Amendments – Concern #7

As mentioned in previous posts, Bill 106: Protecting Condominium Owners Act was introduced in the Ontario Legislature on May 27, and the full text of the bill is now available here. If passed, this bill will make crucial changes to the administration and operation of condominiums, which will affect both condo corporations and owners across Ontario.

Many of the proposed Amendments to the Condominium Act, 1998 (“the Act”) look very good to me. However, I do have some concerns. This is my blog post on Concern #7.

Concern #7 – Agreements respecting Common Element Modifications

Currently, Section 98 of the Act requires that for any permitted modification to the common elements made by an owner after May 5, 2001, there must be an agreement between the corporation and the owner, registered on title to the owner’s unit. This is in addition to other requirements contained in Section 98. These “Section 98 agreements” are binding upon all subsequent owners of the unit.

The proposed amendments would retain this requirement for “Section 98 agreements”, with some changes to the specific requirements.

In my view, this requirement for “Section 98 agreements” is a good idea, because it is important that the owner’s obligations in relation to the permitted modification be recorded on title to the unit, as clear notice to all subsequent owners of the unit. But here’s the problem: Section 98 agreements are not practical for many types of permitted modifications because of the cost to prepare and register the agreements. In many cases, owners and condominium corporations just won’t bother with preparation and registration of an agreement – because of the prohibitive cost.

In our view, the requirements of Section 98 can be legally satisfied by way of a “Section 98 by-law”; which is a much more practical alternative. And it would be helpful, to all Ontario condominium corporations and owners, if the amendments would specifically acknowledge this alternative.