Part 38 published on 01/05/12
Condominium corporation obligated to arrange for unit repairs with reasonable haste
One of the units was damaged by an insured event (fire). The owner alleged that he had suffered loss (primarily lost rental income) due to the corporation’s delays in arranging for the necessary unit repairs. The owner also claimed for storage costs charged by the corporation (for storage of the tenant’s property, removed from the unit after the fire).
The Court ruled in favour of the owner. The Court awarded the owner five months of lost rent (for delay in completion of the unit repairs). The Court also held that the corporation should not have charged for storage of the tenant’s property, because much of the property was unsalvageable and should simply have been removed and disposed of.
The Court said that the corporation should have done more to push the insurer to complete the work in a timely manner (rather than simply leaving the repairs in the hands of the insurer). The Court also said that that the corporation should have moved more quickly to remove the tenant’s personal property from the unit (to facilitate the required repairs).
The Court did say that the condominium corporation was only obligated to arrange for repairs to the standard unit (ie. not to improvements). And under the terms of the corporation’s by-laws, the owner was also responsible to pay the deductible on the corporation’s insurance policy.
[Editorial Note: The Court said that condominium corporations are obligated to repair the standard units (based upon Section 89 of the Condominium Act, 1998). But in my view, the Court failed to consider Section 91 of the Act, which states that the condominium’s Declaration can obligate owners to repair their units after damage. In fact, most condominium Declarations in Ontario state that the owners must repair their units after damage. Even so, the condominium corporation has an obligation to arrange insurance covering the standard unit (subject to a deductible). For that reason, repairs to a standard unit, following an insured event, will normally be undertaken by the corporation’s insurer. (The corporation would be more directly involved only if the corporation prefers not to make an insurance claim in a given case.) In any event, the principle expressed by this case seems to be as follows: When unit repairs are undertaken by the corporation’s insurer, the corporation’s obligation is to take reasonable steps to assist the insurer and to expedite the insurer’s repairs.]