Part 39 published on 01/08/12
Board entitled to change decision made by previous Board
The plaintiff was an owner and former Board member. While he was on the Board, the Board decided to replace the original steam boilers with similar steam boilers. After the plaintiff left the Board, the Board reversed that decision and instead decided to install a hot water boiler (ie. instead of replacing existing steam boilers with new steam boilers). This decision was in fact ratified by a majority of the owners, although the majority fell just short of reaching the threshold required for a special resolution, being a two-thirds majority.
The plaintiff’s claim (among others) was for recovery of his contribution towards replacement of the boilers on the basis that the Board had improperly reversed itself and that a two-thirds majority vote of owners was required for the change. It was the plaintiff’s contention that changing the existing steam boilers to hot water boilers was an improvement requiring a special resolution of the owners under the by-laws of the Corporation.
The Court held that the Board had the right to reverse the previous Board decision. Furthermore, the work did not require approval of the owners by special resolution as the work constituted repair or maintenance as opposed to an improvement within the meaning of the by-law. The Board must act in good faith in the best interests of the Corporation. The Board is entitled to be wrong but in this case the Board was not wrong. The plaintiff’s claim was ultimately dismissed in its entirety.
[Editorial Note: In my view, this is a really helpful decision about the rights of condominium boards to revisit previous board decisions. Until a decision is implemented – or until others have taken steps in reliance upon the decision – a board of directors can revisit a previous decision. But of course any decision must always be consistent with applicable legislation and with the condominium’s governing documents.]