Part 30 published on 01/05/10
Board not unreasonable in demanding damage deposit prior to work by owner
Maverick Equities had the right to make certain changes to the property. [See Condo Cases Across Canada, Part 23, September 2008]
The Board nevertheless insisted that Maverick provide a permanent $5,000 damage deposit before being permitted to proceed with the work. [This damage deposit was contemplated by the corporation’s rules.] The Court said that the Board’s demand (of a damage deposit) was proper. The court said:
“A condo board is not a traditional administrative tribunal; yet, its decisions should be treated with analogous deference. As between individual owners and the condo board itself, it must be emphasized that a condo board embodies, in addition to the notions of a tribunal, the notions appropriate to an elected body. Therefore, decisions of a condo board are entitled to respect.”
“The evidence also establishes that there was nothing unfair in the imposition of the requirement of a damage deposit on Maverick: since the Rules requiring the paying of a damage deposit were imposed, the Board has enforced this requirement on all owners who made alterations to which the Rule applied. It was not unfair that the board decided not to go back to try to impose a damage deposit on owners who had made alterations prior to the passage of the by-law: it may have been impossible to impose such a condition retroactively.”
The Court said that the size of the deposit was proper, given the risks. Therefore, the deposit did not constitute a penalty.