Part 33 published on 01/02/11
Status certificate failed to disclose unit defect
Durham Condominium No. 36 contains 35 industrial use units. The particular unit contained an interior concrete block wall which served to support the roof trusses. Originally, this partition wall contained a doorway about 36 inches wide. At some undetermined point in the past, the doorway had been widened to 10 feet, without the knowledge or consent of the condominium corporation. According to the corporation’s declaration, this modification required the consent of the Board.
The unit was sold and the purchaser requested a status certificate. The status certificate did not disclose the problem.
In accordance with recommendations of an engineer, the purchaser reinforced the 10-foot opening by installing a steel lintel across the top of the opening. However, the condominium corporation wanted the wall to be returned to its original condition. The Court said that the status certificate prevented the condominium corporation from making this demand.
The timing of the corporation’s awareness or knowledge of the modification was considered by the Court. In that regard, the decision included the following key passage:
“Richard Duval, the President of the corporation, attended at the unit “for a routine inspection” on or about October 24, 2008. The common assumption during the argument was that he had inspected the unit before he signed the status certificate on October 22, 2008 on behalf of the corporation, but nothing turns on the discrepancy in the dates since the corporation had time to correct it. Relying on the status certificate, the respondent (purchaser) closed the transaction and took possession of the unit on October 31, 2008.”
[Editorial Note: This case stands for the proposition that condominium corporations must disclose unit problems in any status certificate for the unit. But surely the condominium corporation is only obligated to disclose unit problems of which the corporation is aware at the time the status certificate is issued. This decision seems to suggest that the condominium corporation must issue a revised status certificate if it gains relevant information before the purchase transaction is completed. I don’t agree. In my view, a status certificate must reflect the corporation’s knowledge at the time the status certificate is issued and the corporation has no obligation to issue a revised status certificate if new information comes to the corporation’s attention after issuance of the status certificate. It’s up to the purchaser to request a new status certificate, if he or she wishes. I suppose a condominium corporation can always decide to issue a revised status certificate, if it wishes to do so, but this could also create problems (for example if purchase conditions have been waived based upon the previous certificate).]