Part 12 published on 01/11/05
Improper remuneration paid to Directors
This Application was commenced by the owner subsequent to the application described above. This owner sought to have all remuneration paid to Directors, Officers and the property manager, not approved by by-law, returned to the corporation. At the hearing, the owner’s counsel limited the request to those payments made in 2000.
The question at issue was whether payments could lawfully be made without a by-law.
The court held that all payments made to Directors without a by-law having been passed were a contravention of section 28 of the Condominium Act (now section 56) and must be repaid. The court also held that even if these directors were paid “as officers”, section 28(1)(c) (now 56(1)(d)) would apply and a by-law was still required.
While the court was not required to deal with the issue of past payments, the court did state that where historical payments were made in good faith, the court would not have required repayment. The Directors were, however, required to repay amounts received at a time when the Directors were aware of the need for a by-law.