October 2022
Not all condominium corporations are properly managed. While most directors volunteer to serve their community, some do so for personal benefit. It can be surprisingly easy for directors to profit from their volunteer position when owners fail to demand compliance with the Condo Act and defend their rights.
One community has not had an annual general or board meeting since April 2014. Their term of office expired on April 9, 2017. As of mid 2022, these directors remain in office without an election scheduled. Owners are not provided with the corporation’s budget or annual expenses, nor are they allowed to examine financial documents.
It can be surprisingly easy for directors to profit from their volunteer position when owners fail to demand compliance with the Condo Act and defend their rights.
The president of the board profits from this volunteer position by owning a property management company; similar to the prior president who also served as condominium manager for a salary. The board terminated a prior management company and hired the president’s company to manage the affairs of the corporation. This individual does not have a license to operate as a condominium manager in the province of Ontario and the company is not licensed. A Superior Court decision ordering the individual and company to stop managing the corporation has been issued.
No criminal laws have been broken.
Protections against these abuses are available to condominium owners should they choose to exercise their rights. Many choose not to do so. It may be preferable to allow a bad board to remain in place when nobody is willing and qualified to serve as a director. When problems arise, few choose to document concerns and seek recourse through the Condominium Authority Tribunal. Perhaps the primary reason to accept these abuses is the faulty belief they are saving money. In the situation described here, condo fees were $576 per month. At this level, it is hard to believe the community is keeping up with necessary maintenance and repairs. Owners may feel it is acceptable to pass these costs to future owners. More likely is that, in the not-too-distant future, owners will be saddled with unmanageable costs or be unable to sell their home.
For these communities, the future is grim.
