Part 21 published on 01/02/08
Disagreement respecting Declaration subject to mandatory mediation and arbitration under Section 132 of the Act
This case involved a dispute between the condominium corporation and a tenant respecting the tenant’s use of one of the units. [The owner of the unit, the numbered company (“161”) was also a party to the dispute, but took a neutral position, arguing that this was a dispute between the condominium corporation and the tenant.]
The condominium corporation asserted that the tenant was using the unit as a “restaurant”, in contravention of the Declaration. The tenant asserted that the use was not prohibited by the Declaration.
161’s legal counsel had suggested that the parties proceed to mediation, in accordance with Section 132 of the Condominium Act 1998, but the condominium corporation had instead commenced a Court proceeding, seeking a cease and desist order, under Section 134 of the Act.
The Court said that the disagreement was subject to mandatory mediation and arbitration under Section 132(4) of the Act and that the Court proceeding could only proceed if those mandatory procedures failed.
The Court said:
In these circumstances, I am satisfied that Sections 132 and 134 of the Condominium Act apply….Section 132(4) incorporates in the Declaration a provision that the plaintiff and the owners agree to submit to mediation and arbitration “a disagreement between the parties” with respect to the Declaration. I believe there is sufficient “disagreement” between the plaintiff and 161 for the purposes of section 132(4). The latter does not now concede that the interpretation advanced on behalf of the Plaintiff is correct…
[Editorial Comment: Previous cases have confirmed that the mandatory mediation and arbitration provisions of Section 132(4) of the Act do NOT apply to disagreements or disputes between a condominium corporation and a tenant. It seems to me, then, that the corporation’s dispute against the tenant, in this case, should have been permitted to proceed by way of Court process.]