Owner Awarded Damages for Corporation’s Slow Repairs

A recent court decision confirms the rights of owners to claim for damages when their condominium corporation fails to attend to repairs with sufficient haste.

Here’s the key extract from the court’s decision in Ryan v. York Condominium Corporation No. 340:

“If one examines the whole history and does not approach the facts incrementally, what emerges is that YCC 340 has had a known water penetration problem for over thirty years and has not fixed the problem. This is patently not reasonable. Even if one ignores YCC 340’s state of knowledge acquired before 2010 about the existence of a water penetration problem, the stark fact emerges that Mrs. Bird and Mr. Ryan advised YCC 340 about the water infiltration problem in April 2010 and repeatedly thereafter, but it took YCC 340 until November 2014 (4.5 years) to effect repairs that appear so far to have arrested the water infiltration problem and another year to remediate the presence of mould.”

The decision includes a number of interesting findings, including the following:

• Mandatory mediation/arbitration did not apply to this claim, at least in part because the owner had included a claim for oppression under Section 135 of the Condominium Act.
• In determining whether or not a condominium corporation has breached its repair or maintenance obligations, the court again confirmed that the standard is reasonableness – that is, whether or not the condominium corporation has acted reasonably in attempting to fulfil its obligations.
• Although the court found that YCC 340 had breached its repair obligations, the court did not find any oppression. The court said: “Oppressive conduct is coercive, harsh, harmful, or an abuse of power”, and can also include “unfairly prejudicial conduct” or “conduct that unfairly disregards the interests of the claimant”. The court said that, in this case, the corporation’s conduct was “ineffective until recently but it was not abusive or oppressive”.

But what I found most interesting about the decision was the court’s award of damages to the owner. The court awarded Mr. Ryan $69,691.39, broken down as follows:

• $37,457.07 – Common area expenses for the condominium unit for 2011 to 2015
• $7,456.84 – Municipal realty taxes for the condominium unit for 2011 to 2015
• $3,780 – Gas mileage expense for medical appointments 2011-2015 (28 trips)
• $5,997.48 – Legal expense (for legal services prior to the court process)
• $15,000 – For repairs to the interior of the condominium unit

The water damage had forced the owner to move to his farm property – far from the condominium. In short, he was not able to make use of his unit. Here’s some of what the court said about the damages:

“The explanation for this award is that because of YCC 340’s failure to repair the damage to the common elements, Mr. Ryan’s quiet enjoyment of his Unit has been disrupted and he was unable to enjoy the benefits of ownership. The expense he incurred for common area expenses and for municipal realty taxes was a wasted expense. He, therefore, is entitled to recover $37,457.07 and $7,456.84 respectively.

He is also entitled to recover the travel expense to his medical appointments and his legal expenses. These were expenses he would not have incurred had YCC 340 complied with its obligations under the Condominium Act.

Mr. Ryan, however, is not entitled to recover his $20,000 claim for utilities and maintenance expenses for the farm property. These expenses were not wasted, and it would be double counting to make an award on this account. He is also not entitled to recover his claim for the $4,206.24 special assessment, which is or will be used to effect repairs to the condominium buildings. As a unit holder, Mr. Ryan remains obliged to pay this expense, which will be for his benefit.”

The court did not award Mr. Ryan damages for mental distress “because he proved no loss under this head of damages”.

In summary: Condominium corporations must attend to common element repairs with reasonable haste. Otherwise, if owners lose the use of their units, they may assert claims against the corporation for “wasted” common expenses and realty taxes.

To read more about a corporation’s duty to repair and maintain, take a look at our previous blog post.