Christy J. Allen

The decision addresses two motions in a commercial real estate dispute: a motion to strike claims against individual condominium directors, and a motion for production of documents.

The court struck the claims against the directors but granted the plaintiff leave to amend, finding the pleadings did not sufficiently distinguish the directors’ conduct from that of the corporation.

The court also dismissed the plaintiff’s production motion, holding that privilege over communications with counsel and the property manager was not waived by the addition of the property manager as a third party.

The ruling clarifies the high threshold for personal liability of condominium directors and the scope of privilege in multi-party litigation.

Two neighbouring condominium corporations, Ottawa-Carleton Condominium Corporation No. 574 (574) and Ottawa-Carleton Condominium Corporation No. 573 (573), brought cross-applications to determine their legal and financial obligations regarding a shared timber retaining wall requiring replacement. 574 sought a declaration that 573 was responsible for 40% of costs, proportional to the wall's presence on their property. 573 claimed the wall encroached on its property and sought its relocation or a significantly reduced cost contribution (8.11%).

The court dismissed 573's encroachment claim, finding the Site Plan Agreement did not create enforceable obligations between successors in title and that 573 was bound by the original developer's decisions.

The court determined that the wall was a common element benefiting both properties and that 573 was statutorily obligated to contribute to its maintenance.

The court ordered a 60/40 cost split, with 574 paying 60% and 573 paying 40%, based on the proportion of the wall on each property, rejecting 573's arguments for a lower contribution based on hypothetical original plans or perceived benefit.

Substantial indemnity costs were awarded to 574 due to 573's unreasonable refusal of settlement offers and the resulting disproportionately high legal costs.

The appellants appealed a decision of the Superior Court of Justice dismissing their application and sought leave to appeal a costs order.

The Court of Appeal found that the application judge correctly identified and applied the applicable legal principles, and that section 6.2 of the Shared Property Agreement was enforceable.

The court upheld the costs order, finding that the respondents were entitled to indemnification of legal costs from the Common Fund under sections 3.7 and 11 of the Shared Property Agreement.

The appeal was dismissed and leave to appeal the costs order was refused.

The respondents were awarded costs on a substantial indemnity basis to be assessed.

This decision addresses a costs motion following an application where the applicants unsuccessfully challenged the validity and enforceability of a co-tenancy agreement clause.

The co-tenancy committee members, who were respondents in the original application, sought substantial indemnity costs.

The court found that contractual indemnification clauses in the co-tenancy agreement entitled the committee to substantial indemnity costs.

The court awarded $90,000 in substantial indemnity costs against the applicants, inclusive of disbursements and HST, but declined to award costs against other self-represented respondents who did not actively participate in the application.

The applicants, owners of a townhouse in a building scheme, sought to discharge a restrictive covenant (s. 6.2 of a co-tenancy agreement) under s. 61(1) of the Conveyancing and Law of Property Act.

The covenant prohibited exterior alterations without co-tenancy committee approval.

The applicants argued the provision was spent, ambiguous, or obsolete.

The court dismissed the application, finding that the covenant was not spent and had continuing practical value for maintaining the community's architectural integrity.

It was not ambiguous when interpreted within the context of a building scheme's community of interests, and minor inconsistencies in its application did not constitute inherent ambiguity.

Furthermore, previous alleged violations had not rendered the provision obsolete as they had not eroded the overall character of the community.

The applicant, 3716724 Canada Inc., sought substantial indemnity costs against Carleton Condominium Corporation No. 375 following a successful application where the court found the respondent had unfairly disregarded the applicant's interests.

The applicant also sought costs thrown away from an adjourned hearing.

The court awarded the applicant $35,500 plus HST and disbursements, declining full substantial indemnity due to the applicant raising additional unsuccessful issues, but granting increased costs due to the respondent's unreasonable insistence on a full-time security guard despite sufficient alternative proposals.

Following an application concerning enforcement of a condominium declaration restricting units to single family residence use, the court determined the issue of costs.

The applicants had been largely successful on the underlying application, obtaining findings that the condominium corporation was obligated to enforce its declaration and that certain grandfathering provisions in a proposed rule were unreasonable.

The court held that litigation was necessary to compel compliance with the declaration and that the applicants achieved the substantive relief sought.

Considering the factors under rule 57.01 of the Rules of Civil Procedure, including settlement offers and litigation conduct, the court awarded costs jointly and severally against the corporation and a director who had breached his statutory duties.

The applicants, unit owners at Carleton Condominium Corporation No. 111, sought a declaration that a proposed rule defining 'single family residence' and its grandfathering provisions were unreasonable and inconsistent with the condominium's declaration.

They also sought an oppression remedy against the board and a declaration that the board president breached his duties as a director.

The court found the ten-year grandfathering provision for existing owners to be unreasonable and inconsistent with the declaration, invalidating the rule.

The court dismissed the oppression claim against the board but found that the board president breached his standard of care as a director by actively undermining the board's efforts to enforce the declaration and acting in bad faith.