Peel Condo Corp 166 v Ohri, 2017 ONSC 6438.

January 2018

• Peel Condo Corp 166 v Ohri, 2017 ONSC 6438.

Overview

Peel Condo Corp 166 v Ohri (“Ohri”) discusses condominium dispute resolution in the context of board members appearing to abuse their power during elections. The current Condominium Act sets out two means to resolve disputes between condominium boards and unit owners; including mediation & arbitration or court proceedings. The amendments to the Condominium Act under Bill 106 will direct dispute resolution into a new process overseen by the Condominium Authority Tribunal (“CAT”). Ohri serves as a useful reminder of the dispute resolution process and its ability to collect and weigh evidence surrounding a dispute. Even though the CAT’s process is not fully implemented, unit owners, board members, and property managers should be aware that the CAT’s dispute resolution process can expose untoward behaviour and punish it accordingly. Ohri provides an example of directors potentially abusing their power.

Facts

The dispute in Ohri started with a contested board election and an apparent power struggle between the current directors and a new candidate. In this case, Mr. Ohri assisted Mr. Singh with running for the Board. Several incumbent Board members apparently went to great lengths to ensure Mr. Singh lost, including; invalidating proxy votes based on the allegation that Mr. Ohri intimidated unit owners to vote for Mr. Singh. The incumbent Board apparently made false assault accusations against Mr. Ohri and brought a court application to force Mr. Ohri to comply with the governing documents or else be expelled from the Condominium. In this case, several incumbent Board members went to great lengths to discredit Mr. Ohri’s reputation.

The Board’s application was contested by Mr. Ohri on the ground that sections 132 to 137 of the Condominium Act required their dispute to be submitted to mediation and/or arbitration before bringing a court application. Mr. Ohri was successful at the hearing, on the basis that the dispute was in regard to the Corporation’s election by-laws and mediation/arbitration should have been attempted before bringing the matter to court. The Judge left it up to the parties to agreed upon costs.

In this case, they court took the position that, “[t]hey must be vigilant, especially in the context of a Board election in a condominium corporation, to ensure that its process is not manipulated by Board members who seek to maintain political control within the condominium by seeking a venue in which the condominium’s superior legal resources, and the indemnification terms of its rules, give it a significant advantage in a contest with a Unit owner.”

Bottom Line

The Condominium Act expects that parties attempt mediation and/or arbitration for disputes involving the declaration, by-laws, and rules. Once the CAT is fully in place, it will likely oversee this dispute resolution process, including mediation and arbitration. The CAT’s jurisdiction will include disputes regarding compliance with the aforementioned documents. Board members entering the dispute resolution process should be mindful of their conduct, and be ready to defend their actions to the mediator, the arbitrator, or the CAT.

Written by Benjamin Baena, edited by Robert Mullin and Chris Mendes.