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Condo boards don’t always need owners' permission

When it comes to making changes in condominiums, boards don’t always have to seek input from unit owners, Toronto condo lawyer John De Vellis tells Law Times.

Usually, substantive changes — ones that represent more than 10 per cent of the annual budget — require a vote with two-thirds support, reports the online legal publication.

But boards can make some modifications above that limit without notifying the owners. For example, the board can authorize repair and maintenance projects that are required by law or for the safety and security of those using the property, says the article.

Similarly, utilities, management and maintenance contracts often represent more than 10 per cent of the budget but don’t require approval for their renewal, says De Vellis, a partner with Shibley Righton LLP.

In a recent case, De Vellis, along with Stefan Rosenbaum, acted for a condo corporation that entered into a bulk cable television contract with a new provider for all the units, adding internet services to the common expenses.

The plaintiffs argued that the corporation didn’t have jurisdiction to enter into the contract. They maintained the new contract, which didn't include an opt-out option for unit owners, represented a substantial change and was not valid without the approval of the owners, reports Law Times.

De Vellis argued that adding the internet service didn’t fall within the parameters that required the approval of owners “because it was simply a renewal of an existing contract with an additional service that didn’t represent a substantial change,” says the article.

“Now there’s case law for that. It also clarifies the jurisdiction issue,” says De Vellis.

The court agreed with De Vellis, saying the declaration listed “cable” as a common expense like utilities. As a result, the cost of cable shouldn’t be included in the calculation of the change, which put the addition of the internet below the threshold that requires the involvement of the owners.

The judge said the condo corporation “acted within its jurisdiction” by entering into an agreement with the service provider “and it was not required to provide notice to unit owners or to secure the approval of 66 2/3 of unit owners before doing so.”

De Vellis says the case provides clarity since previous case law didn’t explicitly list cable and internet as equivalent to utilities. 

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