Vancouver, Pendrell Place: James Balderson writes to Chief Justice Brenner regarding inordinate delay in rendering Court decision

MyLeakyCondo.com

[Address deleted]

 

Friday, June 22, 2007

 

AN OPEN LETTER TO

 

The Honourable Chief Justice Brenner

The Supreme Court of British Columbia

800 Smithe Street

Vancouver, BC  V6Z 2E1

 

Dear Chief Justice:

 

You reported “The vision for the civil justice system is one which assists people in obtaining just solutions to legal problems quickly and affordably.” (Report of the Chief Justice, Supreme Court of British Columbia 2006 Annual Report, p. 12).

 

The Court took more than 14 months to give reasons for judgment in Oldaker v. The Owners, Strata Plan VR 1008, 2007 BCSC 669 (the judgment).  Court records, including Trial Lists, show that Madame Justice Gill attended to various other proceedings during the fourteen months.

 

The judgment was released May 11, 2007.  The timing is troubling.  The easily observable scaffolding attached to the east wall of Pendrell Place at 1819 Pendrell Street was dismantled a few days earlier.  The removal of scaffolding could have signalled to an ill-informed observer that the partial repair work was completed when it was not completed.  Given the long delay and the timing of release, it seems reasonable to hypothesize that the Court may have been monitoring the progress of the partial repair work.  However, the timing of release could have been entirely unrelated to the removal of the scaffolding.

 

The evidence before the Court showed that Professional Engineers from Levelton (McGowan and Evans in June 2002 and Evans in November 2005) recommended repairs to the building envelope.  Despite the statutory obligation, to this day not even the partial repairs approved by the owners have been completed in accordance with the requirements of the jurisdiction having authority, that is, the City of Vancouver and the Vancouver Building By-law.  Mr. Oldaker, now 80 years of age has been without the use of his leaky rotten condo for seven years, unlike the younger owners of 21 other strata lots .  The Court’s excessive delay in delivering the judgment has unfairly delayed the re-occupation of his condo.  The judgment is under appeal.  The civil justice system has been slow and expensive, not quick, and certainly not affordable for most leaky condo owners.

 

Please account for the inordinate delay and eventual timing of the judgment.

 

Yours truly,

 

Dr. James Balderson, Ph.D., Q.S.   

 

[Ed. note: No reply received as of Monday, March 17, 2008.]

Purchaser of leaky condo sells leaky condo at loss; sues vendor alleging fraudulent misrepresentation at time of purchase; court dismisses claim

                                             Date:  19990525

                                             Docket:  C972091

                                          Registry: VANCOUVER

 

 

 

 

      IN THE SUPREME COURT OF BRITISH COLUMBIA

 

 

 

BETWEEN:

 

      MARTHA MORALES LOPEZ and MARTHA ANGELICA LOPEZ

 

 

                                                   PLAINTIFFS

 

 

AND:

 

               MICHAEL SHEA and BONNIE SHEA

 

 

                                                   DEFENDANTS

 

 

 

                 REASONS FOR JUDGMENT

 

                        OF THE

 

         HONOURABLE MR. JUSTICE E.R.A. EDWARDS

 

 

 

Counsel for the Plaintiffs:                  JULIEN A. DAWSON

 

 

Counsel for the Defendants:              CHRISTOPHER R. BACON

 

 

Place and Date of Hearing:                    VANCOUVER, B.C.

                                                MAY 19, 1999

 

 


[1]  The defendants apply under Rule 18A for summary dismissal of the action.

 

[2]  The plaintiffs allege the defendants fraudulently misrepresented the condition of a condominium unit they sold the plaintiffs in April 1993 for $205,000 by “actively  concealing” a latent defect in the fabric of the building.  The plaintiff’s seek “recession” (sic) of the purchase contract and damages.

 

[3]  The defect alleged is a crack in the concrete foundation of the unit purchased by the plaintiffs which caused it to leak in March 1995.  It was repaired twice over the ensuing year or so by the strata council at no cost to the plaintiffs.  The active concealment alleged is the construction of a gyproc wall over the cracked concrete wall.

 

[4]  Apart from $1300 water damage to a sofa, the plaintiff’s main claim is for the $43,000 loss they sustained when they sold the unit in June 1997.  Between 1994 and 1997 the plaintiffs were subject to special assessments by the strata corporation totaling about $2600  for leak related repairs to other buildings in the condominium complex.  This amount they also claim as damages.

 

[5]  The plaintiffs’ position is that had they been aware of the crack at the time of purchase they would not have bought the unit and incurred the special assessments or the loss on resale. 

 

[6]  The plaintiffs did not inquire about the repair history of the unit or the complex before their purchase and did not read the strata council minutes which disclosed leak problems with the foundations of two of the seven buildings in the complex. Neither was the building in which the unit they purchased is located.

 

[7]  The evidence of the defendants, corroborated by the condominium property manager, is that these leak problems in the other buildings had been resolved by 1989.  The property manager also deposed that there was no recurrence of the problems in the other buildings until August 1994.

 

[8]  Having alleged fraud, the onus is on the plaintiffs to prove the defendants knew of and concealed the foundation leak at the time of sale.

 

[9]  The evidence on which they rely to do so is the following:

     (a)The evidence of the plaintiff Ms. M.M. Lopez and her common law husband Mr. Faber that after the leak developed in March 1995 the gyproc wall was removed in May 1995 to reveal the leaking crack which had apparently been repaired earlier.

     (b)The hearsay evidence of an as yet unidentified repairer who Mr. Faber deposed had told him on inspecting the leak there were several cracks and “the patch-like appearance of the lighter concrete indicated an earlier negligent attempt to repair the cracks.”

    

     (c)The hearsay evidence of a neighbour, Mr. Allen, who Ms. M.M. Lopez deposed told her the defendant, Mr. M. Shea, unsuccessfully attempted to repair “the crack” in February 1993.

 

[10] From this evidence, evidence that the neighbour Mr. Allen had repaired a similar crack in 1993 and the fact the defendants had been the only occupants of the unit from its initial purchase, the plaintiffs would have the court infer that the defendants knew of the crack, repaired it negligently and deliberately covered it with the gyproc wall to hide the repair.

 (More)

West Vancouver, Hacienda Del Norte: Court dismisses appeal; suggests former homeowners who purchased defective leaky rotten house without pre-purchase inspector would win $710,000 damage claim if they sued post-purchase inspectors

COURT OF APPEAL FOR BRITISH COLUMBIA

Citation:

Cardwell v. Perthen,

 

2007 BCCA 313

Date: 20070606


Docket: CA033932

Between:

Eric Cardwell and Diane Susan Cardwell

Appellants

(Plaintiffs)

And

Juergen E. Perthen and Helga G. Perthen

Respondents

(Defendants)

Before:

The Honourable Madam Justice Prowse

The Honourable Madam Justice Levine

The Honourable Madam Justice Kirkpatrick

 

J.A. Hand, and

W. Sun

Counsel for the Appellants

P. Sandhu

Counsel for the Respondents

Place and Date of Hearing:

Vancouver, British Columbia

March 29, 2007

Place and Date of Judgment:

Vancouver, British Columbia

June 6, 2007

 

Written Reasons by:

The Honourable Madam Justice Levine

Concurred in by:

The Honourable Madam Justice Prowse

The Honourable Madam Justice Kirkpatrick

Reasons for Judgment of the Honourable Madam Justice Levine:

Introduction

[1]                This appeal concerns the liability of a vendor of a residential property for defects and deficiencies discovered by the purchasers after completing the purchase without a professional inspection.  The appellants, the purchasers, claimed a loss of $710,000 suffered on the sale of the home.  The trial judge found the respondent, the vendor, liable for damages of $35,442 for dangerous latent defects which he had failed to disclose.  The appellants claim the trial judge erred in articulating and applying the legal test distinguishing patent and latent defects; failed to consider whether the mitigation efforts of the purchasers were reasonable; and failed to consider the appellants’ claim of negligent construction.  They ask this Court to reassess their damages.

[2]                The trial judge’s reasons for judgment are reported at (2006), 41 R.P.R. (4th) 118 and may be found at 2006 BCSC 333.

[3]                For the reasons that follow, I would dismiss the appeal.  The trial judge did not err in articulating and applying the legal test for distinguishing patent and latent defects.  Whether or not the mitigation efforts of the appellants were reasonable at the time they suffered their loss, the vendor cannot be held liable for their loss.  For the reasons given by the trial judge, it is not necessary to decide the appellants’ claim for negligent construction.  There is no basis for this Court to interfere with the trial judge’s assessment of the damages.

Background

[4]                In May 2000, the appellants agreed to purchase the residence located in West Vancouver, B.C. for $1,350,000.  The appellants viewed the home twice with their real estate agent.  Their second offer, for $300,000 below the asking price, without conditions and for all cash, was accepted by the respondent.  The contract of purchase and sale was not made subject to the appellants completing an inspection of the home, and the appellants did not retain a qualified inspector to inspect the home before closing.  

[5]                Shortly after the closing, the appellants became aware of structural deficiencies, mould growth, and leaks throughout the home.  Six months after the purchase, the appellants sold the home in an “as is” condition for a loss of $710,000. 

The Renovations

[6]                The respondent purchased the residence in 1986.  At that time, it was a 2,000 square foot, single-storey bungalow.  In the following years, the respondent, who had considerable experience in matters of general construction and property management, extensively renovated the property.  Among other modifications, he built a series of retaining walls; relocated the kitchen, added a bathroom and bar to the home; moved an interior wall; added a beam to the dining room; and enclosed an outdoor patio to enlarge the living room area.  The respondent carried out most of the renovations himself, or had them done at his direction. The respondent and his wife lived in the residence throughout the renovations.

[7]                The respondent originally commenced the work without obtaining the necessary permits.  The neighbours became concerned about the work, especially the construction of the retaining walls.  Following complaints from one or more of the neighbours, the District of West Vancouver sent an inspector to the property. Although the District expressed some initial concerns about the deficiencies in the building plan, it granted the required permits to continue with the renovations.  From that point on, periodic inspections were conducted by the District.  Numerous deficiencies were identified over time, and the respondent remedied those deficiencies or allayed the District’s concerns by hiring expert third parties to prepare inspection reports to confirm the integrity of the designs and renovations. 

[8]                In the end, the property was transformed from a modest bungalow into “Hacienda Del Norte”: a spacious, Santa Fe style residence with a partial upper level, extensive pitched and flat-roof areas, a two-storey ornamental bell tower, a covered portico supported by columns and a second garage.  

Discovery of Defects and Deficiencies

[9]                Before moving in, the appellants decided to undertake some minor cosmetic renovations to the home.  They intended to replace the carpet in the living room and home office with tile.  When they lifted the existing floor, they found that the sub-floor had been constructed over old carpeting, the wiring did not go through the floor joists but over it, and a vapour barrier was installed on top of the joists — all of which caused moisture to collect under the floor, resulting in rot and mould.  Flaws were also discovered in the master bedroom: below the sub-floors, the wood timbers were soggy and black fuzzy mould was present on some of the joists.  As the sub-floors were removed throughout the house, the appellants began to realize the extent of their problem.  Underneath the sub-floor in the family room, there was no concrete slab, only soil.  Black water was dripping out of the joists and there appeared to be mould. 

[10]            The appellants sought a report on deficiencies from Gordon Spratt & Associates, consulting engineers.  The two principal contacts at Gordon Spratt & Associates were Mr. Trundle and Mr. van Blankenstein.  The appellants received a report on October 10, 2000 (the “Spratt Report”), which listed numerous deficiencies to the floors, walls, roof structures, outbuildings and retaining walls.  The Spratt Report recommended that the appellants either demolish the house and build a new one, or sell it. 

[11]            The appellants retained cost estimators, Heylar & Associates, to review the Spratt Report and determine the cost to repair the deficiencies.  The estimate was in excess of $1,000,000. 

[12]            The appellants believed their only two options were to either rebuild the home at considerable expense, or sell it and cut their losses.  Based on the Spratt Report and the cost estimate, and motivated by the danger created by the toxic mould, the appellants chose to sell the home. 

Re-sale of  the Home

[13]            The property sold quickly to an associate of Mr. Bebek, a builder, for $700,000. The intention was that Mr. Bebek and his brother would cosmetically restore the house for resale.

[14]            Six months after they purchased the home, the appellants realized a loss of $710,000 (including fees and other charges on the sale).

[15]            At trial, Mr. Bebek testified that he spent approximately $270,000 to cosmetically upgrade the property (including $50,000 to remodel the kitchen and a bathroom).  This amount represented his out-of-pocket expenses, and did not include amounts for wages or management fees for him or his brother.  He estimated that these fees would be about an additional 10-15% of the $270,000. 

[16]            In August 2003, an associate of Mr. Bebek sold the property for $1,265,000 to the McLoughlins.  Prior to the purchase, the McLoughlins commissioned an inspection, which revealed that some flashing had to be added and that other minor work was needed.  None of this was significant.  Shortly after the purchase, the roof began to leak.  The McLoughlins spent approximately $100,000 upgrading the home.  They did not break down how much of this was expended solely on repairing the leaky roof.  The McLoughlins decided to sell the property for $1,350,000 after owning it for only nine months.

The Lawsuit

[17]            The appellants sued the respondent for negligence (including negligent misrepresentation and negligent construction), fraud, and breach of contract.  Before trial, they settled their claims against the respondent’s real estate agent, the realty company for whom she worked, the District of West Vancouver, the engineering company retained by the respondent, and one of its engineers. 

Trial Judge’s Reasons for Judgment

[18]            The trial judge reviewed the background and evidence in detail.  She discussed (at paras. 73-118) the “Details of the Principal Alleged Deficiencies”, with reference to the Spratt Report, the trial evidence of Mr. van Blankenstein, and other experts who gave evidence for each of the parties. 

[19]            The trial judge described the Spratt Report (at para. 73):

In overview, the Spratt Report is a strongly worded condemnation of the construction quality of practically the entire residence and every out-building and the retaining walls.  It describes work as being crude and unprofessional at times achieving an appalling workmanship standard.  With a broad brush it paints a picture of a grievously flawed residence, with massive leaking or potential for significant water ingress, mold, structural defects and settlement concerns.  In effect, it advocates demolition of much of the house.  Also in evidence were videos capturing Mr. van Blankenstein’s criticisms on site taken just before the Cardwells sold and one taken by Mr. Perthen during a weekend break of trial showing the current exterior condition.  I will discuss below, under separate headings, the main areas of concern.

[20]            In reviewing the main areas of concern with the property. as described in the Spratt Report, the trial judge found that neither Mr. van Blankenstein nor the other experts supported the opinions that had been expressed in the Spratt Report.  The trial judge noted that with reference to “Walls and Sub-Floor Deficiencies”, Mr. van Blankenstein “became surprisingly equivocal on the moisture issue” (at para. 75); on “Roof Deficiencies”, he “qualified this statement [about water penetrating the roof] very significantly on cross-examination where he agreed that rain water was in fact not penetrating when he wrote his report and that his report was merely speaking to the potential of that occurring” (at para. 85); on the “Foundations”, “Mr. van Blankenstein’s evidence was insufficient to show that the foundations were inadequate or failing or that there was systemic problems with the walls, roof or floors” (at para. 97).  In the result, the trial judge placed little weight on the Spratt Report (at paras. 116-118):

            In carefully weighing the evidence, I have concluded that the Spratt Report conjures a deeply misleading impression of the true state of the property.  I have already referred to a number of instances where Mr. van Blankenstein’s criticisms were exaggerated or without factual foundation altogether.  Those previously articulated examples do not amount to an exhaustive list.  There were many instances in Mr. van Blankenstein’s cross-examination where he attempted to resile from the recommendation in the Spratt Report that the house be torn down.  In the end, he admitted that a wholesale demolition might not be required.  Mr. van Blankenstein failed to distinguish between areas of the house that had simply gotten worn out (e.g. the flat roofs of the garage) from areas that are alleged to be constructed in a negligent manner.  Allegations of shoddy workmanship are not put in perspective.  While Mr. van Blankenstein agreed that the Spratt Report painted a very bleak picture of the situation for the Cardwells at the same time he agreed that the next step in the process would have been to conduct a more intrusive investigation.  His inspection did not involve any destructive testing except for a hole put through the lower brick wall of the family room and in the ceiling between the family and living rooms.

            It would appear that the standards applied by Mr. van Blankenstein in respect of a substantial number of identified shortcomings were whether the work had been carried out to a high standard for a residence of such cost and whether it represented best practices.  Indeed, at the close of the unedited version of the Spratt Report originally provided to the Cardwells, it states that Helyar & Associates’ costings, which were based on the deficiencies highlighted by Mr. van Blankenstein, were for “remediation, to return 835 Younette Drive into a habitable residence to the high standard which Mr. and Mrs. Cardwell believed they purchased.”

            In all the circumstances, I consider it unsafe to rely on much of the contents of the Spratt Report and give it little weight.

[21]            Having reviewed the evidence of the alleged defects and deficiencies, the trial judge turned to the applicable law. She noted (at paras. 119-120) the continuing application of the doctrine of caveat emptor in the context of the purchase and sale of real estate, and the exceptions to the rule which bring into play the distinction between patent and latent defects (paras. 121-129).  She also considered the law relating to implied warranty of fitness in used homes, negligent misrepresentation, and negligent construction.

 (More)

Leaky condo developer Michael Audain endorses John Evans of Triology Properties

"John Evans, the man behind Trilogy, is a smart developer. His company is highly consumer- responsive and forward thinking."

Michael Audain, Chair,
Polygon Homes Ltd.

The exact date of Michael Audain's endorsement of Trilogy Properties above is not known at this time.

However, it was found on Trilogy's website as late as June 05, 2007.

www.trilogyproperties.com  

 

Kelowna, KAS 2048: Strata lot owner failed to provide evidence to prove significant unfairness

IN THE SUPREME COURT OF BRITISH COLUMBIA

Citation:

Southern Interior Construction Association v. Strata Plan KAS 2048,

 

2007 BCSC 792

Date: 20070605
Docket: S066553
Registry: Vancouver

Between:

Southern Interior Construction Association, Inc. No. 8302A

Petitioner

And

The Owners, Strata Plan KAS 2048

Respondent


Before: The Honourable Mr. Justice Rogers

Reasons for Judgment

Counsel for the Petitioner:

T.A.M. Peters

Counsel for the Respondent:

D.M. Rush

Date and Place of Hearing:

May 28, 2007

 

Kelowna, B.C.

Introduction

[1]                The petitioner owns two of nine strata lots in a commercial development located in Kelowna, B.C.  The petitioner asserts that the current allocation of common costs, based upon the petitioner’s strata entitlement units, is significantly unfair to it.  It says that the court should exercise its discretion to vary the allocation so as to relieve it of the unfairness.

[2]                These Reasons follow the hearing of the petition.

The Facts

[3]                The strata development in issue was created in June 1998.  It is located in Kelowna, B.C.  The development is exclusively commercial – there are no residences in the building.  The developer was University Business Park Ltd.  There were originally eight separate strata titles.  The relevant legislation in effect at the time required the developer to file a schedule of unit entitlement for each of the eight strata lots.  The schedule of units of entitlement determined, among other things, the proportion of common expenses that any given lot owner had to pay.  The 1998 schedule was thus:

Lot No.

 

Size in
Square Meters

 

Units of
Entitlement

1

 

152

 

152

2

 

153

 

153

3

 

153

 

153

4

 

178

 

178

5

 

181

 

181

6

 

153

 

153

7

 

153

 

153

8

 

152

 

152

[4]                The building is two stories tall, but the size in square meters for each unit was based only on the footprint of the ground floor.  There was no evidence before the court that, when the original schedule of units of entitlement was created, a second floor or mezzanine had been built in any of the units.

[5]                In October 1999, the petitioner offered to buy Lot 4 from the developer.  At that time, that is, in October 1999, a mezzanine had been constructed inside Lot 4.  The petitioner stipulated a condition in its offer.  The condition was that it be permitted to subdivide Lot 4 into two separate lots, one lot to comprise the ground floor and a portion of the mezzanine and totalling 242 square meters, and the other lot to comprise the remainder of the mezzanine which totalled 116 square meters.  The subdivision plan required unanimous consent from the other strata lot owners.  Those other owners gave their consent.  The petitioner completed its purchase of Lot 4 and it began the process of subdivision.

[6]                The subdivision was completed in October 2000.  The subdivision plan was submitted to the Land Title Office.  Under the plan, Lot 4 was replaced by Lot 9 which was the ground floor and a portion of the mezzanine totalling 242 m2, and Lot 10 which comprised the 116 m2 remainder of the mezzanine.  The subdivision plan was accompanied by a certificate from a surveyor.  The surveyor confirmed the area in square meters of the two new lots.  A new schedule of unit entitlements was also created.  Lot 4 was deleted from the new schedule and the newly created Lots 9 and 10 were added.  The new schedule of unit entitlement was thus:

Lot No.

 

Size in
Square Meters

 

Units of
Entitlement

1

 

152

 

152

2

 

153

 

153

3

 

153

 

153

(deleted) 4

 

-

 

-

5

 

181

 

181

6

 

153

 

153

7

 

153

 

153

8

 

152

 

152

9

 

242

 

242

10

 

116

 

116

[7]                The new schedule did not show any changes in the area of the lots not affected by the subdivision.  There is no evidence that the surveyor was asked to survey the other lots for the presence of mezzanines, nor was there evidence that in October 2000 there were, in fact, any other mezzanines constructed inside those lots.

[8]                The petitioner immediately sold Lot 10 to a third party.  In October 2002, the petitioner bought Lot 10 back from the third party.

[9]                In the fall of 2001, the petitioner put a motion to the strata corporation to alter the basis on which the area in square meters of the strata lots should be determined.  The status quo then was that the area of the lots was determined by the footprint of the lot’s ground floor (i.e.:  the original method of determining unit entitlement).  The petitioner’s motion would have changed the formula by increasing the lot area to 1.5 times the footprint of the ground floor.  This, presumably, would have had the effect of including in the lot’s area whatever floor space might have been added by the construction of a mezzanine level.  The members of the strata corporation considered the petitioner’s proposal.  In November 2001, the strata corporation members voted to reject the petitioner’s motion to revise the schedule of units of entitlement.

[10]            In 2006, the development’s roof required repair.  The repair was carried out at a cost of approximately $52,000.  That expense was allocated among the strata owners in accordance with their units of entitlement.  The petitioner’s share of the roof expense, based upon its allocation of a total of 358 units (242 units for Lot 9, plus 116 units for Lot 10) was slightly shy of 25 percent of the total.  If the petitioner’s units had been limited to the area of Lot 9’s ground floor footprint, its share of the expense would have been only 14 percent.

[11]            Although there was no reliable evidence led on the point, the parties agreed that as of the petition’s filing in October 2006, Lot 6 did not have a mezzanine but the other Lots did have mezzanines constructed inside them.  There was no evidence and no agreement with respect to the size of those other mezzanines or when they were built.

Relief Sought

[12]            The petitioner seeks a declaration that the current allocation of units of entitlement is significantly unfair to it.  The petitioner asserts that all but one of the other Lot owners have and use mezzanines, but that the petitioner is alone in having to pay common costs based upon its ownership and use of a mezzanine.  The petitioner says that the proper thing to do is to quash the new schedule of units of entitlement and to reinstitute the original schedule.  That would, according to the petitioner, be fairer in an overall sense than the present regime.

Applicable Legislation

[13]            The relief the petitioner seeks engages two sections of the Strata Property Act, S.B.C. 1998, c. 43.  They are s. 246 and s. 164.

[14]            Section 246 describes the method by which units of entitlement shall be determined when a strata plan is developed.  There are two schemes:  one for residential and one for non-residential (oftentimes called commercial) strata developments.  The portions of the section relevant to this proceeding read thus:

246(1)  The person applying to deposit a strata plan must establish the unit entitlement of a strata lot in accordance with subsection (3).

(3)        The unit entitlement of a strata lot, other than a strata lot in a bare land strata plan, must be calculated as follows:

(a)        if the strata lot is a residential strata lot, the unit entitlement is either

(i)         the habitable area, in square metres, of the strata lot, as determined by a British Columbia land surveyor, rounded to the nearest whole number,

(ii)        a whole number that is the same for all of the residential strata lots, or

(iii)       a number that is approved by the superintendent and that in the superintendent's opinion allocates a fair portion of the common expenses to the owner of the strata lot;

(b)        if the strata lot is a nonresidential strata lot, the unit entitlement is either

(i)         the total area, in square metres, of the strata lot, as determined by a British Columbia land surveyor, rounded to the nearest whole number,

(ii)        a whole number that is the same for all of the nonresidential strata lots, or

(iii)       a number that is approved by the superintendent and that in the superintendent's opinion allocates a fair portion of the common expenses to the owner of the strata lot.

(4)        For the purposes of subsection (3), "habitable area" has the meaning set out in the regulations.

(7)        Subject to the regulations, an owner or the strata corporation may apply to the Supreme Court for an order under subsection (8) if

(a)        the unit entitlement of a residential strata lot is calculated on the basis of habitable area in accordance with subsection (3) (a) (i) or on the basis of square footage in accordance with section 1 of the Condominium Act, R.S.B.C. 1996, c. 64, and

(b)        the actual habitable area or square footage is not accurately reflected in the unit entitlement of the strata lot as shown on the Schedule of Unit Entitlement.

(8)        On application under subsection (7) and after consideration of the matters set out in the regulations, the Supreme Court may

(a)        order that a Schedule of Unit Entitlement be amended, in accordance with the regulations, to accurately reflect the habitable area or square footage of a strata lot, and

(b)        make any other orders it considers necessary to give effect to an order under this subsection.

[15]            Section 164 of the Act clothes the court with the power to rectify decisions taken by a strata corporation that are significantly unfair to one or more strata owners.  Section 164 reads:

164(1)  On application of an owner or tenant, the Supreme Court may make any interim or final order it considers necessary to prevent or remedy a significantly unfair

(a)        action or threatened action by, or decision of, the strata corporation, including the council, in relation to the owner or tenant, or

(b)        exercise of voting rights by a person who holds 50% or more of the votes, including proxies, at an annual or special general meeting.

(2)        For the purposes of subsection (1), the court may

(a)        direct or prohibit an act of the strata corporation, the council, or the person who holds 50% or more of the votes,

(b)        vary a transaction or resolution, and

(c)        regulate the conduct of the strata corporation's future affairs.

Issues

Application of Section 246

[16]            The remedial provision in s. 246(7) has no application in this case.  That is because that remedial provision is limited to redressing problems in the allocation of entitlement units based on habitable areas in residential developments.

[17]            However, the fact that there is no remedial provision for commercial developments is, nevertheless, instructive.  The fact that the Legislature did not include a remedial provision for commercial strata plans indicates that the Legislature wished that commercial strata developers should adhere to one of the three allocation methods stipulated by s. 246(3)(b) (i.e.:  prorated based on area in square meters, equal allocation, or some other formula approved by the Superintendent).

[18]            In the context of commercial developments, then, s. 246 comprises a code for the calculation and determination of entitlement units in commercial strata developments.  There is no room for departure from the statute.

[19]            In the present case, the subdivision of Lot 4 engaged the allocation method prescribed by s. 246(3)(b)(i).  The petitioner did not take the position that equal allocation in accordance with s. 246(3)(b)(ii) should have been employed.  The petitioner did not bestir itself to seek the Superintendent’s approval of a custom designed formula as it might have done under s. 246(3)(b)(iii).

[20]            What in fact happened was that the subdivision surveyor determined the area in square meters of each of the two new lots that derived from Lot 4.  Those areas were incorporated into a new schedule of unit entitlement.  The subdivision process thus adhered to the statutory prescription for determination of area and the entitlement schedule.  Neither party to this proceeding can reasonably complain because the subdivision followed the statute.

[21]            Neither can the petitioner reasonably complain that the surveyor did not survey all the other lots in the development in the year 2000 to determine whether they, too, had mezzanines.  The petitioner offered no evidence that, in October 2000, when the subdivision was completed, any of its neighbours had built or were using second story space in their units.  Absent some evidence that there was reason to believe that the area in square meters of the other units had increased by virtue of additional mezzanine space, the petitioner cannot credibly complain that the survey ought to have included all the other strata lots.  There was, therefore, no reason then, and no ground now, for complaint that the area of the other units remained unchanged when the new schedule of unit entitlement was created.

Application of Section 164

[22]            There are three distinct steps to determining whether an order should be made pursuant to s. 164.  The first step is to identify the decision under attack; the second is to assess all the facts relevant to the fairness of that decision; and the third is to assess whether the decision was, in all the circumstances, significantly unfair to the applicant.

[23]            The petitioner relied on s. 164 but did not specifically identify the decision or decisions it wants remedied.  Be that as it may, the court should nonetheless assess the evidence before it in order to determine whether there are any decisions that might be reviewable pursuant to the statute.

[24]            As noted earlier, the original and the new schedules of unit entitlement were prepared in accordance with the area formula prescribed by s. 246(3)(b)(i).  They were not the product of a decision of the strata corporation or council.  The original allocation of unit entitlement and the allocation that followed the subdivision were not, therefore, decided by the strata corporation or council.  The original and the new schedules of entitlement units are not, therefore, reviewable under s. 164.

[25]            The petitioner did put forward a motion in 2001 for a reallocation of the units of entitlement.  By that motion, the petitioner sought to revise the definition of “strata lots’ area” in square meters.  The revision would have had the effect of grossing up each lot’s ground floor area by one-half.  The corporation did not adopt the petitioner’s proposal.  That was a decision by the corporation, and it is a decision that could be subject to review pursuant to s. 164.

[26]            The evidence the petitioner adduced in the hearing did not describe the facts and circumstances of the strata owners when they cast their votes.  More specifically, the petitioner did not lead any evidence to show that when they voted on the petitioner’s measure, one, some, or all of the lot owners actually had mezzanines or second floors in their lots.  Absent that information, the court cannot assess whether it was fair, ordinarily unfair, or significantly unfair for the owners to have decided to reject the petitioner’s proposal to revise the allotment formula.  The petitioner has, therefore, simply failed to establish that the circumstances surrounding the November 2001 vote could bottom a finding that the corporation’s decision was significantly unfair to the petitioner.

[27]            The only other decision by the strata corporation to which the petitioner referred was its decision to allocate the cost of repairing the building’s roof in accordance with the new schedule of unit entitlement.  That was clearly a decision taken by the corporation and it is, therefore, capable of being the topic of review under s. 164.

[28]            That decision was taken only a few months before the petition was filed.  The petitioner asserts that as of the advent of the petition all of the other strata lots, excepting only Lot 6, had mezzanine space.  Given that only two or three months passed between the decision and the petition, it is reasonable to infer that those mezzanines were in place when the corporation decided to alloca

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