Part 50 published on 01/05/15
Condominium corporation has no authority to release unique claims of the owners
In a separate Court proceeding, the condominium corporation (TSCC 1703) had asserted a claim against 1 King West Inc. which included claims on behalf of the owners. That claim was settled, and the condominium corporation signed a release “on its own behalf and on behalf of all unit owners” covering all construction and design deficiencies in the building.
Relying upon the above-noted settlement and release, 1 King West Inc. asserted that the owner’s claims against 1 King West Inc. (which had been made in this separate Court action) should be dismissed.
The Court refused to dismiss the owner’s claims. The Court said that the condominium corporation could not release the unique claims of individual owners. Under Section 23 of the Condominium Act, the condominium corporation’s right is only to assert claims (including claims on behalf of the owners) that protect the “interests of the condominium community as a whole” – not interests that are unique to individual owners. [The Court referred to the decision of the Court of Appeal in 1420041 Ontario Inc. v. 1 King West Inc. (See Condo Cases Across Canada, Part 38, May 2012).]
In summary, the Court held that the settlement and release relating to the claims of the condominium corporation did not deal with the claims asserted by the owner in this proceeding.