Part 10 published on 01/05/05
Agreement between Condominium Corporation and Rogers not binding
The condominium corporation had entered into a bulk service agreement with Bell ExpressVu Limited Partnership (“Bell”). Rogers Cable Communications Inc. (“Rogers”) sought an injunction to prevent the condominium corporation from entering into the bulk service agreement with Bell.
Rogers asserted that it had entered into a previous binding agreement with the condominium corporation (earlier in 2004) which agreement prohibited the condominium corporation from entering into any such bulk service agreements.
The court found that there was no binding agreement between Rogers and the condominium corporation. The agreement in question had been signed by a single member of the board of directors, without authorization by resolution of the board. The Court said: “ The evidence before me would indicate that the agreement between CCC No. 53 and the Plaintiff was signed by a single member of the board of directors thinking that this agreement was simply a continuation of an earlier (simple access) agreement when in fact he was granting an agreement in perpetuity to (Rogers) that the Defendant, CCC No. 53 would not enter into any bulk service agreement with any cable service provider.”
The court noted that the “indoor management rule” has no application to condominium corporations. A single member of the board of directors cannot bind the condominium corporation. Decisions of the board must be taken by resolution at a properly-constituted meeting of the board.
The Condominium Act is consumer protection legislation, the purpose of which is to protect condominium owners. The condominium owners were entitled to the protections afforded by the requirement for a Board resolution. The court said that Rogers should have “made sure their contract received the approval of the board of directors if they wanted a binding agreement”.