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CONDOMINIUMS - Right to sue on behalf of unit owners

Monday, March 09, 2020 @ 9:41 AM  


Lexis Advance® Quicklaw®
Appeal by the defendant property manager from the dismissal of its motion for summary judgment dismissing the respondent Condominium Corporation’s action for alleged construction deficiencies. The appellant argued that because the respondent failed to comply with the notice provision in s. 23(2) of the Condominium Act, the action should be dismissed as a nullity. The respondent did not provide the unit owners with sufficient notice before the notice of action was issued but did, however, provide the owners with detailed notice, including a draft statement of claim, shortly thereafter, and before the statement of claim was filed. The motion judge found that the notice provisions were inapplicable or, if they were applicable, they were satisfied. The action against the appellant arose out of the contractual responsibilities it had to the condominium corporation and therefore, in the motion judge’s view, fell outside the scope of s. 23 of the Act.

HELD: Appeal dismissed. The Court’s earlier decision in Medhurst should be overturned. Non-compliance with the notice provision did not render an action a nullity. There was nothing in the text of the Act that suggested that breach of the notice requirement carried the consequence of a nullity. It would be inconsistent with the purpose of the provision and the Act to find that non-compliance resulted in a nullity. Finding that non-compliance with s. 23(2) resulted in a nullity would undermine rather than support the purpose of this legislation which was to protect the condominium owners from their condominium corporation by ensuring they were aware before it acted. Third parties should not be able to escape liability to the condominium owners because of a failure of the condominium corporation, acting on their behalf, to properly notify the owners. Finding that non-compliance resulted in a nullity would lead to unnecessarily harsh effects and serve no intended purpose. Even if the condominium corporation failed to comply with this provision, it was only a procedural irregularity that was cured.

York Region Standard Condominium Corp. No. 1206 v. 520 Steeles Developments Inc., [2020] O.J. No. 435, Ontario Court of Appeal, J.C. MacPherson, P.S. Rouleau, L.B. Roberts, I.V.B. Nordheimer and A.L. Harvison Young JJ.A., January 31, 2020. Digest No. TLD-March92020002