Case Studies, Spinnaker West: Window washing fiasco

July 25, 2006


TO: Helga Hennsler-Harris, Owner, Strata Lot 6, Strata Plan LMS 497


RE: Window washing fiasco


Thanks for taking the time to leave your condo on a very hot and dry Saturday morning (July 22, 2006) in order to visit the scene in the alley and discuss the Spinnaker West window washing fiasco.


Ann Hedley, the Strata Property Manager from Realacorp, issued a window washing notice to the owners of Spinnaker West.


Mary Kagami, the owner of Strata Lot 3, immediately called Realacorp to ensure that her windows would be washed.


Sharon, and then Ann, both from Realacorp, told Mary that washing her windows “was not in the contract”.


Mary contacted Gary Hamilton the owner of Strata Lot 4 and a Strata Council member.


Gary told Mary to contact Clive Boulton the owner of Strata Lot 5 and the Strata Council President.


Mary sent an email to Clive.


Clive did not respond to Mary. (Apparently Clive is on vacation until the end of July.)


When the window washers (two men) arrived on Saturday morning, Mary went to the alley and asked if they were going to wash her windows.


The window washers said “No”.


Mary returned to her leaky rotten condo.


Mary saw that dirty water was running down from the windows above her unit – from Clive’s dirty windows and from your dirty windows.


The dirty water from the upper windows and north wall was creating a dirty mess on Mary’s windows.


The dirty water from your windows combined with the dirty water from Clive’s windows was also flooding the north deck at Mary’s condo causing the previously dry needles to float on about one inch of water and to plug the drain.


Mary called me.


Mary returned to the alley to discuss the situation with the window washer washing your windows.


I arrived in time to hear the window washer tell Mary that there was nothing he could do about it; that it wasn’t his fault; that he had a job to do; and that he was just doing his job - washing the upper windows; and that he would not clean Mary’s windows, even though he was making a mess of her windows.


I agreed with the window washer’s statements that there was nothing he could do about his instructions from the window washer boss who had left the scene and who got his instructions from Ann Headley of Realacorp and who was, in turn, instructed by the Strata Council of the Strata Corporation to wash your windows and to not wash Mary’s windows.


I suggested to the window washer that we would have to turn off the water because he, the window washer washing your windows, was making a very dirty mess of Mary’s windows, which he said he would not wash.


The window washer stopped washing your windows, turned the water off and disconnected the hose from the hose bib on the BC Cosmetologists Association building (Strata Lot 1).


I asked the window washer to inspect the mess he had made of Mary’s windows so that he would know that Mary had a valid complaint.


The window washer entered Mary’s leaky rotten condo and inspected Mary’s flooded north deck and her windows that had been messed up by the dirty water falling from your windows as he cleaned your windows by tucker pole in accordance with the instructions provided by the Strata Council via Ann Hedley the Strata Property Manager who holds a temporary license to provide strata management services and who has not yet completed the course and examination required by the Real Estate Council of BC for licensing to provide strata management services.


You then appeared on the scene in the north alley in an agitated state.


You demanded to know why the window washer had stopped washing your north windows.


You and I engaged in a spirited, but rather civilized, rational conversation.


You inspected Mary’s flooded north deck and windows by accepting Mary’s invitation to enter Mary’s leaky rotten condo.


You commented that the mess on Mary’s windows was due to the needles from the “pine tree” which had fallen on the deck.


I corrected “pine” to “fir”.


I agreed with your statement that the responsibility for cleaning the fir needles from the deck was Mary’s.


Mary and I have cleaned up the needles several times, especially during each rainy season.


However, I pointed out that the needles often plug the drain, causing water to accumulate on the deck and water to splash on Mary’s windows.


I have personally unplugged the drains several times during the rainy season (September through June).


The Strata Corporation has been informed of the deficiency in drain size, several times over the years, but nothing has been done about it.


You observed for yourself how the dirty water from your windows drained from the deck to the alley once I pushed the blocking needles through the small drainpipe with a custom made improvised utensil carefully crafted from one of Mary’s wire coat hangers.


You offered to clean Mary’s windows yourself, so that the window washer could finish cleaning your windows on Saturday.


Mary objected.


Mary did not want you cleaning her windows, even though she cannot do them herself because of her continuing problem with her arm following her stroke.


I pointed out to you that it was absurd for Mary to pay her unit entitlement proportionate share of the cost of cleaning your windows and the windows of other condos at Spinnaker West, year-after-year, when the other owners of the Strata Corporation would not pay for Mary’s windows to be cleaned, even though cleaning your windows dirtied Mary’s windows - whether the deck was free of needles or not - and, incidentally, provided more water on the north deck and the south deck to seep into Mary’s leaky rotten condo causing further damage to her interior walls and floors.


Mary accepted, in good faith, your sincere offer that you would undertake an effort to get the Strata Corporation to clean Mary’s windows, just like Mary had requested prior to the window washing fiasco on Saturday.


Accordingly, Mary gave permission for the window washer to make a mess of her windows on Saturday while finishing the cleaning of your windows based on your promise that the Strata Corporation would clean her windows “as soon as possible”.


We realize, of course, that you alone cannot bind the Strata Corporation to fulfill your promise, and that the matter would have to be taken up at “the next meeting”, and that the contract for window washing services would have to be modified.


Unfortunately, the window washer, who remained quite polite throughout, had coiled his hoses in preparation for leaving and would not start the window washing job again, leaving your windows partially washed.


You stated that the window washer would have to come back to finish your windows and the other “inaccessible” windows, including Mary’s windows.


I trust your windows and Mary’s windows will be cleaned “as soon as possible”.

Dr. James Balderson, Ph.D., Q.S.

COLCO: The Coalition of Leaky Condo Owners

www.myleakycondo.com

Case Studies, Spinnaker West: Complaints against Realacorp and Ann Hedley filed with RECBC

July 4, 2006

TO: The Real Estate Council of BC

Attention: Maureen Coleman, Senior Compliance Officer

Re: REALACORP MANAGEMENT LTD.,

Brokerage License Number X012800;

and

SARAH ANN HEDLEY, commonly known as ANN HEDLEY,

Managing Broker of Realacorp, License Number 071720;

and

The Owners, Strata Corporation LMS 497, also known as

Spinnaker West 2368 Laurel St., Vancouver, B.C.,

a leaky rotten condo complex.

Please investigate the following issues related to the conduct and competence of Realacorp and Ms. Ann Hedley.

Realacorp and Ms. Hedley provide “real estate services” as that term is defined in the Real Estate Act.

Realacorp and Ms. Hedley provide “strata management services”, as that term is defined in the Real Estate Services Act.

As licensees, Realacorp and Ms. Hedley are bound by the Real Estate Services Act and Rules.

The strata corporation and Ms. Hedley through Realacorp entered into a contract, apparently verbal, in or about the year 1992 whereby Realacorp and Hedley provided and continue to provide strata property management services to the strata corporation, that is, the members of the strata corporation, for a fee.

Ms. Hedley through Realacorp exercises delegated powers and duties of the strata corporation and the strata council of the strata corporation.

In my opinion, the evidence shows that Realacorp and Hedley have contravened the Strata Property Act and the Strata Property Regulations.

In my opinion, the evidence shows Realacorp and Hedley have contravened the Real Estate Services Act and Rules.

In my opinion, the evidence demonstrates that the particular offenses committed by Realacorp and Hedley include, but may not be limited to, the following:

(1) Failing to provide a copy of the “service agreement” as that term is defined by the Real Estate Services Act - Rules within two weeks of a request for a copy of the “service agreement” by a “strata lot owner” as that term is defined by the Real Estate Services Act - Rules, contrary to The Strata Property Act s.36.

(2) Failing to have a written “service agreement” as that term is defined by The Real Estate Services Act – Rules for the purpose of providing “strata management services”, contrary to The Real Estate Services Act – Rules, 5-1 (1) (c). The required written agreement was to be in place “as soon as reasonably practicable” (Rules 10-4 (3)) following January 01, 2006, and was not in place by June 14, 2006, and is not known to be in place as of July 1, 2006.

(3) Failing to enter into a “service agreement” in relation to “strata management services” before providing any of those services, contrary to The Real Estate Services Act – Rules, 5-1 (2) (c), “as soon as reasonably practicable” following January 01, 2006.

(4) Joining with three members of the Strata Council of the strata corporation legally known as “The Owners, Strata Plan LMS 497”, namely, (1) L. Clive Boulton, (a resident owner and lawyer by profession), (2) Glen Harris, (a resident owner and developer of Spinnaker West), and (3) Gary Hamilton, (a resident owner and professional engineer by profession), to facilitate using trust funds, for expenditure(s) that were: (a) not approved by the owners in the 2005-2006 Annual Operating Budget of the strata corporation; (b) not approved by the owners by way of resolution(s) properly presented to the strata lot owners; and (c) for which written approval and authorization was not recorded in the minutes of the strata corporation, contrary to the Strata Property Act and contrary to the Real Estate Act – Rules.

(5) Failing to provide an “Information Certificate” and attachments for Strata Lot 3, Strata Plan LMS 497, within one week of a request by a “strata lot owner”, as “strata lot owner” is defined in the Real Estate Services Act - Rules, contrary to The Strata Property Act s.59.

(6) Providing an “Information Certificate” without the required attachments, contrary to The Strata Property Act s.59.

(7) Providing a misleading, inaccurate and deceptive “Form B Information Certificate” “certifying that the information contained in [the] certificate with respect to Strata Lot [SL03] is correct as of the date of [the] certificate [June 7th, 2006]”, falsely certifying that:

“(a) monthly strata fees payable by the owner of [SL03] the strata lot described above $ [145.44]”; and further falsely certifying that

“(e) Any amount by which the expenses of the strata corporation for the current fiscal year are expected to exceed the expenses budgeted for the fiscal year (year ending March 31, 2006) $ [7268.10) [sic]”.

Background Notes for (7) above:

A. The fiscal year end for the Strata Corporation was March 31, 2006.

B. The monthly fees for Strata Lot 3 were $145.44 during the previous fiscal year that ended March 31, 2006, after which a new fiscal year began and was well underway (two months plus one week) without an approved Budget by the date the Form B Information Certificate was dated and signed by the Licensee, Hedley, being June 7, 2006.

C. The Strata Corporation was in an illegal deficit position contrary to the Strata Property Act of $7,268.10 as of the year ending March 31, 2006.

D. The Strata Property Act requires that year-end operating fund deficits be recouped in the next year’s Annual Budget, i.e., June 1, 2006 – March 31, 2007.

E. It was known, or should have been known by Realacorp and Hedley as Licensees providing “strata management services”, albeit without the required written “service agreement”, that the monthly fees following March 31, 2006, would have to be increased by the stipulated proportionate share of $7,268.10 attributable to Strata Lot 3 according to the schedule of unit entitlement in the strata plan, and likewise for other strata lots, in order to eliminate the unexplained illegal deficit of $7,268.10 incurred in the 2005-2006 fiscal year during the 2006-2007 fiscal year. In other words, the monthly strata fees as of March 31, 2006, if not earlier, and certainly by June 7, 2006, were known, or should have been known, to be substantially more than $145.44 because of the deficit, even if the exact total amount had not yet been determined precisely because of other known and unknown increases which the owners might approve during the belatedly scheduled Annual General Meeting due to be held during the evening of the same day, i.e., June 7, 2006.

(8) Facilitating an illegal delay of the 2006 Annual General meeting of the strata corporation by not holding the Annual General meeting within two months of the fiscal year end, contrary to the Strata Property Act.

(9) Failing to provide answers to questions from a strata lot owner and failing to provide an explicit accounting regarding the expenditure of money held in trust for the owners of the strata corporation despite being asked in accordance with the Strata Property Act to do so by a strata lot owner, that is, by one of the principals of the licensee’s client, a member of the strata corporation, contrary to The Real Estate Act - Rules.

(10) Preparing and presenting a 2006-2007 Budget for the strata corporation which was not in accordance with the Strata Property Act and the Strata Property Regulation s. 6.6, Budget Requirements.

(11) Preparing and presenting financial statements for the strata corporation which were not in accordance with the Strata Property Act and the Strata Property Regulation s. 6.7, Financial Statement Requirements.

(12) Failing to comply with a request for detailed financial information from a strata lot owner and thereby a member of the strata corporation entitled to a notice in accordance with s. 45 of the Strata Property Act, contrary to the Financial Statement Requirements set out in Strata Property Regulation 6.7.

(13) Acting in a manner likely to bring disrepute to the real estate profession generally and, in particular, likely to bring disrepute to those licensed by the Real Estate Council to provide strata management services.

Licensees providing strata management services are operating under a glowing halo provided by the RECBC.

Licensees tout that the public is protected because they must conform to the strict requirements of the RECBC.

However, it appears that the RECBC is mistakenly taking an unwarranted narrow view of its jurisdiction with respect to licensees providing strata management services.

In my opinion, the RECBC, by legislation, regulation and rules, is now bound to consider issues arising from the full range of strata management services commonly associated with the use of licensees as agents of the strata corporation and the strata council with respect to the provision of strata property management services.

In other words, it is my opinion that the RECBC can and should discipline licensees for conduct contrary to the Strata Property Act and Regulations as well as conduct contrary to the Real Estate Services Act and Rules.

I trust your investigation of these complaints against Realacorp and Hedley will produce discipline decisions by the RECBC which will help guide the future conduct of licensees providing “strata management services” and thereby strengthen consumer protection for all strata lot owners.

You will find more information about Realacorp and Hedley at:

Case Studies, Spinnaker West LMS 0497

Yours truly,

Dr. James Balderson, Ph.D., Q.S.

COLCO: The Coalition of Leaky Condo Owners

www.myleakycondo.com

JamesBalderson@myleakycondo.com

Case Studies, Spinnaker West: Illegal budget, leaks and rot

Dear Mary,

Your leaky rotten condo complex, Spinnaker West – 2368 Laurel St. - has adopted an illegal Budget for its 2006-2007 fiscal year, as it did the year previous.

The Statement of Income and Expenses 2005-2006 and the proposed Budget for 2006-2007 distributed just prior to the (late) AGM of June 7, 2006, included a line item called “Maintenance: Extraordinary”.

The Budget amount for this item April 2005 - March 2006 was $1,000.

The Actual amount expended was $5,091.90 being $4,091.90 over budget.

It is my opinion that the Strata Corporation records as distributed to the Owners do not provide an adequate explanation as to what the money was spent on.

It is my opinion that the Property Manager (Ann Hedley of Realacorp - who holds a temporary license to provide strata management services and who has not taken the required course nor passed the required examination) together with the Strata Council were not authorized by the Owners to over-spend the budgeted amount, which should not have been in the Budget in the first place.

It is my opinion that the line item “Maintenance: Extraordinary” is ultra vires the Strata Property Act, which states:

Operating fund and contingency reserve fund

92 To meet its expenses the strata corporation must establish, and the owners must contribute, by means of strata fees, to

(a) an operating fund for common expenses that usually occur either once a year or more often than once a year, and

(b) a contingency reserve fund for common expenses that usually occur less often than once a year or that do not usually occur.

Expenditures from contingency reserve fund

96 The strata corporation must not spend money from the contingency reserve fund unless the expenditure is

(a) consistent with the purposes of the fund as set out in section 92 (b), and

(b) first approved by a resolution passed by a 3/4 vote at an annual or special general meeting, or authorized under section 98.

Expenditures from operating fund

97 The strata corporation must not spend money from the operating fund unless the expenditure is

(a) consistent with the purposes of the fund as set out in section 92 (a), and

(b) first approved by a resolution passed by a 3/4 vote at an annual or special general meeting, or authorized

(i) in the budget, or

(ii) under section 98 or 104 (3).

Unapproved expenditures

98 (1) If a proposed expenditure has not been put forward for approval in the budget or at an annual or special general meeting, the strata corporation may only make the expenditure in accordance with this section.

(2) Subject to subsection (3), the expenditure may be made out of the operating fund if the expenditure, together with all other unapproved expenditures, whether of the same type or not, that were made under this subsection in the same fiscal year, is

(a) less than the amount set out in the bylaws, or

(b) if the bylaws are silent as to the amount, less than $2 000 or 5% of the total contribution to the operating fund for the current year, whichever is less.

(3) The expenditure may be made out of the operating fund or contingency reserve fund if there are reasonable grounds to believe that an immediate expenditure is necessary to ensure safety or prevent significant loss or damage, whether physical or otherwise.

(4) A bylaw setting out an amount for the purposes of subsection (2) (a) may set out further conditions for, or limitations on, any expenditures under that provision.

(5) Any expenditure under subsection (3) must not exceed the minimum amount needed to ensure safety or prevent significant loss or damage.

(6) The strata corporation must inform owners as soon as feasible about any expenditure made under subsection (3).

The Strata Corporation Minutes of the 2006 AGM held on June 7 show that Otto Folprecht and Glen Harris moved and the Owners approved a motion “That the Extraordinary Maintenance category be increased [from $2,000] to $20,000.”

In my opinion the motion was clearly “out of order” and should not have been considered at the meeting, which was chaired by Clive Boulton. Apparently several lawyers who were present raised no objection to the Owners passing a motion ultra vires the Act.

Also, contrary to the Act, you were not provided with a schedule showing your proportionate share of the Budget, with and without inclusion of the illegal $20,000.

In other words, 15 days later, you are still in the dark as to the amount of your annual strata fees, which, because of the illegal budget, will now be considerably more than the previous year.

Yet another year has passed under the continuing illusion of progress and false promises at Spinnaker West.

More tarps and clear plastic have been added to the roof area.

Your condo still leaks and rots.

The drywall in your kitchen is soggy and falls to the floor in larger and larger chunks.

The cost of repairs continues to climb enormously.

And yet the Owners of the Strata Corporation have still not resolved to fulfill their statutory obligation to repair the leaky rotten common property, despite having received several expert professional reports over several years prescribing the conversion from face-seal to rain-screen technology, the building envelope standard in Vancouver since 1996.

I am quite certain the other residential owners (Boulton, Lavajac, Hamilton, Harris/Hennsler-Harris, Reeves/Rykman and Folprecht) would have had the building fixed years ago if their interior walls were as soggy and rotten as the ones in your leaky condo.

And the rot goes on, and on, and on ….

My very best personal regards,

Dr. James Balderson, Ph.D., Q.S.

COLCO: The Coalition of Leaky Condo Owners

www.myleakycondo.com

JamesBalderson@myleakycondo.com

Case Studies, Spinnaker West: Continuing leaks and rot

Dear Mary,

As you know, I patrol your leaky rotten condo at Spinnaker West several times per week.

This is to let you know that we have had a near-record prolonged period of rain during December 2005 and January 2006. Although we had a clear day yesterday, several more days of wet weather are beginning today.

I have drained approximately two inches of standing water from your North deck several times. The tiny drain spouts plug up with needles from the fir tree. Nothing has been done to enlarge the drains.

So much water has drained down and into the North wall that the doorframe for the door from your front room to the deck has swollen making the door very difficult to open and to close. You would not be able to open it in case of fire.

The usual wet areas in the kitchen, den and foyer are very wet and the drywall has deteriorated further. Your custom wood flooring in the den is twisted, lifted and stained even more than when you left.

Glen Harris and Clive Boulton met on Clive’s rooftop deck yesterday morning with, presumably, another contractor.

As of January 1, 2006, Strata Property Managers must be licensed. Realacorp Management Ltd. is currently licensed. Sarah Ann Hedley is licensed for Trading, Rental Property Management, and Strata Property Management.

Strata property managers are agents of the Strata Council. As agents they can only legally do that which the Strata Council authorizes them to do.

As you know, the owners of Spinnaker West, LMS 0497 have not instructed the Strata Council to repair the building which has been leaking and rotting since first occupied in the early 1990’s.

Please note that my email referring to 2005 BCSC 1760, Ranftl v. The Owners, Strata plan VR 672 should have referred to the leaky rotten condo complex at 1024 West 7th Avenue, not the one at 1040 West 7th Avenue. The latter leaky rotten condo has completed extensive repair work. The necessary work at 1024 remains stalled, although Garth Cambrey’s term as an expensive administrator was recently extended.

I trust the sun will shine again over Vancouver and that your leaky condo will dry out somewhat before next fall.


Dr. James Balderson, Ph.D., Q.S.
COLCO: The Coalition of Leaky Condo Owners
www.myleakycondo.com
E JamesBalderson@myleakycondo.com

Case Studies, Spinnaker West: "The Depths of Fabrication"

Mrs. Kagami forwarded this editorial from the December 5, 2005 edition of The Japan Times concerning the falsification of earthquake-resistance data for the designs of condominium buildings. Some of these buildings are already scheduled for demolition, leaving residents to deal with finding new places to live.

Mrs. Kagami noted: "I'm vulnerable on both sides of the pond, not only Vancouver!"

In a situation highly reminiscent of British Columbia's leaky condo fiasco, the article states:

Suspicions about this unfolding scandal deepend even more because the players involved - Mr. Aneha, the design certification agencies, construction firms and condominium developers, and perhaps even the ministry - appear repugnantly reluctant to take responsibility, unable to understand their situation or void of professional ethics.



And the rot goes on and on...

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