Channa v. Carleton Condominium Corporation No. 429 (Ontario Superior Court)

The condominium corporation had incurred costs (including legal costs) as a result of the owner’s acts or omissions, including an unauthorized modification to the common elements.  The Court said:  

• “A corporation is entitled to apply the costs of remedying breaches by an owner of a unit to the common expenses payable for the unit.” (including legal costs)
• Furthermore, the corporation is entitled to apply the owner’s payments to the earliest indebtedness, unless the owner has “specified that that the payments are to be credited differently”.
• However, in order to properly secure common expenses by lien against the unit, the lien must be registered within 3 months of the default, in accordance with s. 85(2) of the Condominium Act, 1998.  Furthermore, a claim with respect to any unsecured arrears (ie. amounts not secured by lien) will be lost if Court process is not started within the normal two-year limitation period.
• Respecting the unauthorized modification, the corporation was not demanding that the modification be reversed, but rather sought an order that the owner be required to enter into an agreement with the corporation (in relation to the modification) in accordance with s. 98 of the Condominium Act, 1998.  The Court agreed, and granted the order.
• Mandatory mediation and arbitration did not apply because the dispute related to a direct breach of the Act.  Therefore, the corporation’s application to Court was the proper procedure.