New Ontario condo laws target boards and directors

The Ontario government has announced a series of changes to the way condominium boards are governed.

The announcement comesafter CBC Toronto uncovered problems that Greater Toronto Area condo owners were having with several boards, including alleged corruption and conflicts of interest.

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The new laws announced Tuesday by the Ontario ministry of government and consumer services seek to fix what some saw as loopholes in currentcondominium regulations.

Among themis a new requirement that board directors disclose if they are not owners or occupiers of a condo.

In May, CBC Toronto revealed that a group of three men and their associates were accused of "hijacking" the boards of about a dozen highrise condominiums in the GTA and gaining access their multi-million dollar budgets and reserve funds.In most cases, these individuals did not appear to own units or live in the condominiums where they served on the board of directors.

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Under the new laws, directors must also disclose to boards if they have conflicts of interest regarding the corporation and its business contracts.

In February, the board of onedowntown Toronto condo signed an energy contract which well-exceeded the market price for natural gas that appeared to benefit the associate of one of the directors.

Other changes, to be implemented this fall, include:

• Regular mandatory updates about acondo corporation to help improve communication between boards and owners.
• Mandatory training for condo directors.
• Clearer rules to make it easier for condo owners to access records.
• New notices, quorum and voting rules to make it easier for owners to participate in owners' meetings.
• Mandatory education requirements for condo managers applying for a general licence.

"Creating new consumer protections will help to build more sustainable condo communities so residents moving into condos today and in the future will be able to look forward to healthy condo communities and peace of mind in the place they call home," Minister of Government and Consumer Services Tracy MacCharles said in a statement.

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New condo authorites

The statement also mentioned the establishment of the Condominium Authority of Ontario CAO) and the Condominium Management Regulatory Authority of Ontario (CMRAO), two previously announced administrative authorities that will be designated this fall.

The CAO will provide education and promote awareness of condo owner rights and responsibilities, as well as manage the Condominium Authority Tribunal, a bodythatwill resolve disputes.

The CMRAO will regulate and licence condo managers.

What will it cost?

AudreyLoeb, alawyer with Shibley RightonLLP who specializes in condominium law, expects to see some improvement in the way condos are governed, but said it won't be free.

"Consumer protection always costs more money," Loeb told CBC Toronto.

Condo corporations will fund the operating costs of the new regulatory bodies by collecting a fee from owners, MacCharlessaid at a news conference in Toronto on Tuesday.

The government estimates that this will cost owners approximately $12 annually, depending on the size of the condo corporation.

The cost notwithstanding, Loebsaidthat condo owners will soon see some long overdue changes in the industry.

"There will be more information available; hopefully, better dispute resolution available and hopefully, better control over developers than what we have now," she said in an interview.

At a separate event on Tuesday, Premier KathleenWynne said that the new regulations were created out of comprehensive consultationwith stakeholders.

"There had been real concerns about accountability of boards, the training of board members, the dispute resolution mechanisms. So we've responded to that consultation," Wynne said.