Part 57 published on 01/03/17
The strata corporation had levied fines against the owners for violations of the corporation’s by-laws. Unlike strata fees, fines cannot ordinarily be collected by way of lien.
The owner regularly paid her monthly strata fees, but did not pay the fines. The strata corporation passed a by-law amendment stating that payments would be applied first to the oldest charges on the owner’s account. The strata corporation then applied the owner’s ongoing payments (which were made by preauthorized payments) against the outstanding fines, so that the outstanding arrears were all recent strata fees. The Court held that the strata corporation was not permitted to apply the owner’s payments in that manner. The Court said:
The strata
Another potential remedy available to the strata corporation is to refuse to provide a certificate of payment under s. 115 of the (Strata Property Act) in the event that the owner wishes to sell the property. This would compel the owner to pay any amounts outstanding, including fines.
On the hearing of this petition, the strata corporation argues that such procedures are cumbersome and expensive. It argues that the lien procedure for unpaid strata fees under the (Strata Property Act) is more efficient.
The Court noted that the preauthorization payment form indicated that the payments were being made on account of strata fees, and accordingly could not be applied against fines. The Court said:
In my view, the by-law is invalid to the extent that it would preclude an owner from stipulating that fees are being paid and that fines are not, thereby denying the owner the remedies set out in the (Strata Property Act). The by-law must be read down in order to avoid that result.