New Claws For The CAT: Pets, Vehicles, Parking, And Storage (A.K.A. Part 4 Of Why The CAT Must Award Legal Costs)

On Thursday October 1^st 2020, the Condominium Authority Tribunal of Ontario (the “CAT”) expanded its jurisdiction beyond disputes about condominium record-keeping and record-disclosure, to also include disputes about pets, vehicles, parking, and storage (what we’ll call “PVPS” issues).  The CAT’s jurisdiction now includes disputes about chargebacks for those PVPS issues as well.

We briefly discussed this expansion of jurisdiction in our latest article (here), in our ongoing multi-part series about why the CAT should award legal costs. But let’s take a closer look at what the CAT has done, and what the CAT must do going forward (you guessed it; finally award legal costs to successful parties!).

No More Court, No More Mediation/Arbitration: CAT Only, for PVPS Issues

Prior to October 1^st 2020, if a condominium corporation wanted to enforce a provision in its Declaration, By-laws, or Rules (the “governing documents”), the condominium would take the unit owner (and the tenant if necessary) to the Ontario Superior Court of Justice under Section 134 of the Condominium Act (the “Act”).  Under Section 134(3)(b)(ii) of the Act, a condominium could be awarded with 100% of its legal costs incurred in enforcing against the unit owner (and tenant) in Superior Court.

However, as of October 1^st 2020, if a condominium corporation wants to enforce a provision in its governing documents related to:

1. pets or other animals,
2. an “automobile, motorcycle, van, truck, trailer, bus, mobile home, farm tractor, bicycle, motor-assisted bicycle, motorized snow vehicle, motorboat, rowboat, canoe, kayak, punt [yes, this author had to look that one up], sailboat, raft, aircraft, device used to facilitate the transport of a person with a disability, or any other vehicle drawn, propelled or driven by any kind of power, including muscular power”;
3. the parking or storage of items in a unit or on the common elements that is intended for parking or storage purposes (i.e. a Parking Unit or a Locker/Storage Unit); or
4. the ability of the condominium to charge back a unit owner for any of the aforesaid issues;

… then the condominium corporation must bring their Application for enforcement to the online CAT tribunal instead.

And as we have repeatedly written about before (here, here, and here), the CAT does not, as a default rule, award legal costs – so even if the condominium corporation is 100% successful in its Application to enforce against the unit owner, the CAT will award the condominium with exactly 0% of its legal costs (at least, based on the vast majority of the CAT’s rulings so far, pertaining to condominium records disputes).

If you’re a condominium, don’t even think about trying to charge back a pet owner for the costs of cleaning up their pet’s defecation on the common elements.  If you do, the charged-back pet owner could take the condominium to the online CAT, and the condo’s legal costs in defending against the owner’s Application – even if the condominium is entirely successful in its defence – will very likely outweigh the $40 clean-up fee that you charged back.

Now, we do admit that the CAT’s no-costs-recovery rule (currently Rule 46.1 of the CAT’s Rules of Practice) may not be applied as strictly as it has been to date, by the CAT Adjudicators when deciding upon a PVPS dispute under this new expanded regime.  For all we know, a CAT Adjudicator may rule in an upcoming PVPS case that an “exceptional reason” which allows for a condominium to recover 100% of their legal costs is, for example, due to the existence of a widely-drafted indemnity clause in that condominium’s Declaration.

One can only hope.

Otherwise, very few condominium corporations will ever enforce against an owner for a PVPS issue. Pets will defecate everywhere without consequence, owners will repeatedly park their vehicles in Visitors Parking, people will store derelict and leaking vehicles in their Parking Unit, and condos will not be able to charge back for any of it. 

Without the threat of charging back the condominium’s legal costs to the violating owner, the condo effectively loses most, if not all, of its enforcement power.  Condominiums in Ontario cannot impose monetary fines for bad behavior, but condominiums can charge back its costs incurred onto the unit’s ledger of common expenses owed.  However, after October 1^st, no condo will risk doing so for a PVPS issue; even if they have crystal-clear HD security camera footage of the pet owner letting their dog defecate on the lobby carpet, and DNA evidence to back it up. 

The risks, and consequent costs, of doing so are too high for the condominium – even if the condo is entirely in the right to do so, and may even be obligated to do so under Section 17(3) of the Act as part of its duty to enforce the provisions of the Act and the governing documents.

Some Limited Exceptions, and Why Everyone Will Become Dog Experts

The Regulation under the Act that governs the CAT’s jurisdiction, O. Reg. 179/17, does list three (3) exceptions that would allow a PVPS issue to stay outside of the CAT’s reach:

1. If the PVPS dispute involves a Section 98 Agreement (i.e. a written agreement regarding an owner’s modification of the common elements), the dispute would still go to private mediation/arbitration under Section 132 of the Act;
2. If the PVPS dispute involves an Electric Vehicle Charging System Agreement (i.e. a written agreement under Section 24.6 of the General Regulation to the Act), the dispute would still go to private mediation/arbitration under Section 24.7 of the General Regulation; or
3. If Section 117 of the Act is triggered, the dispute would still go to the Ontario Superior Court of Justice under Section 134 of the Act.

Section 117 of the Act stipulates that:

“No person shall permit a condition to exist or carry on an activity in a unit or in the common elements if the condition or the activity is likely to damage the property or cause injury to an individual.”

So if you’re a condominium corporation and there’s a noisy dog causing a disturbance to all of the neighbours, you better hope that the chihuahua starts biting people in the hallways as well – or at least, that Coco the Chihuahua can pose a “likely” threat of biting people.  If so, then instead of being stuck in the CAT, you can still bring a Section 134 compliance Application to the Superior Court against the owner and seek 100% recovery of the condo’s legal costs of doing so.

From now on, every condominium with a PVPS enforcement issue will start looking for a Section 117 “escape hatch” to take the dispute outside of the CAT’s jurisdiction and into the Superior Court instead. 

Naturally, everyone will become dog threat experts. Remember the uproar and fierce debate over the “pit bull” ban in Ontario, and whether certain breeds were dangerous or not? Well, get ready for puppy photos inside the CAT’s online portal.  Lots and lots of puppy photos, about how Rocky/Killer/Beast would never hurt a fly.

So What Now? Do We Just Descend Into Condo Chaos?

It’s 2020, so the answer you probably expected is “Sure, why not”.

There is a solution though.  The CAT’s Rules of Practice can be revised by the Condominium Authority of Ontario’s new Board of Directors, so that legal costs are more routinely awarded to a successful party – regardless of whether the successful party is a condominium corporation or a unit owner.  Does that suggestion look familiar? It’s because we’ve been calling for this very measure, since at least April 26^th 2019 (which, in COVID-time, was eons ago).

As legal counsel to condominium corporations all across Ontario, we are often called upon to be the last line of enforcement against an incalcitrant unit owner who just won’t stop parking his vehicle in the Visitors Parking, letting his dog leave “care packages” in the hallways, or storing a junk vehicle that is leaking fluids all over the underground parking garage.  Like Crown Attorney prosecutors, we are tasked with making sure that the societal rules of this 4^th level of government are complied with; or else, as the Superior Court put it, “chaos will result” in the community.

But unlike Crown Attorneys on the public dime, condominium corporations are non-profit entities who have to hire their own legal counsel to enforce the communal rules that everyone agreed to when they moved in and/or bought their unit.  Without the ability for these non-profit organizations to recover those legal costs of enforcement in PVPS issues brought before the CAT, condominium corporations will essentially stop enforcement altogether.

Chaos, anarchy, and poop everywhere.  That cannot be what the CAO wants.

All of the information contained in this article is of a general nature for informational purposes only, and is not intended to represent the definitive opinion of the firm of Elia Associates on any particular matter. Although every effort is made to ensure that the information contained in this newsletter is accurate and up-to-date, the reader should not act upon it without obtaining appropriate professional advice and assistance.

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