The New Condominium Authority Tribunal Rules Are Out!

Here are some of the highlights of the new CAT Rules:

For every dispute, a five-step process is contemplated:

I. The Process

Step 1:  Filing [CAT Fee:  $25.00]

Step 2:  Joining (ie. where the Respondent joins the case) [No CAT Fee]

Step 3:  Negotiation (an on-line dialogue between the parties, all within CAT’s on-line system) [No CAT Fee]

Step 4:  Mediation (where a mediator joins the dialogue, to try to help the parties settle) [CAT Fee:  $50.00]

Step 5:  Tribunal Decision [CAT Fee:  $125.00]

II. Representation

The CAT Rules say that parties can be represented in the process (if they wish) by:

(a) a lawyer or paralegal licensed by the Law Society of Upper Canada; or

(b) a person who is exempt from the Law Society’s licensing requirements. This includes a friend or family member who is helping the User without receiving any fee, or a licensed condominium manager.

III. Costs

In terms of costs, the CAT Rules state as follows:

Recovery of fees and expenses

The Tribunal may order a User to pay to another User any reasonable expenses or other costs related to the use of the Tribunal, including:

(a) the Tribunal’s fees paid by the other User;

(b) the other User’s expenses or other costs that were directly related to that User’s participation in the Tribunal’s process; and

(c) the other User’s expenses or other costs that were directly related to a User’s behaviour during the Tribunal process that was unreasonable or for an improper purpose, or that caused an unreasonable delay.

 Legal fees generally not recoverable

The Tribunal will not order one User to pay to another User any fees charged by that User’s lawyer or paralegal, unless there are exceptional reasons to do this.

In summary, the “losing party” generally won’t be ordered to pay the “winning party’s” legal or paralegal costs (if any).  And this will of course be a growing issue as CAT is given increased jurisdiction (over more and more types of condominium disputes) in the years ahead.

Some parties may understandably decide, as a result, not to involve lawyers or paralegals in many CAT disputes.  For condominium corporations, one or more Directors or Officers may sometimes be comfortable handling the process.  In other cases, the property manager may be an excellent representative. [NOTE: This may however be an “extra service” for the manager – perhaps entitling the manager to a reasonable, extra fee (which would likely not be recoverable in the dispute).]

But some condominium corporations may still be most comfortable having legal representation in these disputes – despite the fact that the costs will generally not be recoverable.  [Also:  In some instances, the case precedent may be an important factor for the condominium corporation.]

With this in mind, we are planning to train one of the members of our team (whether a condominium law paralegal or junior lawyer) to assist our clients with CAT disputes…in order to make this service as economical as possible for our clients.  That way, we’ll be ready to assist, at reasonable cost, if we are ever asked to do so.

One final comment:  In our view, the condominium corporation’s liability or D & O liability insurance likely would not respond (or provide coverage) in most CAT disputes.  But this might depend upon any specific allegations in a given case.  So, insurance coverage is always something to keep in mind.

IV. The CAT Rules also cover various other matters relating to the CAT process, including:

(a) Methods of Communication, primarily involving use of CAT’s on-line system (or alternative methods of communication approved by CAT);

(b) Presentation of evidence;

(c) Delivery of relevant documents;

(d) Witnesses; and

(e) Public Access.