CONDO LAW
Ins and outs of assuming interim occupancy
October 17, 2009
Gerry Hyman
SPECIAL TO THE STAR
Q: During the 10-day "cooling off" period for my purchase of a new condominium unit, the developer rejected requests for amendments to the agreement of purchase and sale.
One of the rejected requests was that I be allowed to pay an additional deposit of $100,000 prior to occupancy. That would reduce the occupancy period rental, which includes interest on the balance of the purchase price. There have been a number of extensions to the occupancy date. Do those extensions entitle me to require the developer to accept the additional payment prior to occupancy?
A: A purchaser, notwithstanding any contrary provision in an agreement of purchase and sale, is entitled during the 10-day rescission, or cooling off period, to elect to pay the balance of the purchase price on assuming interim occupancy.
If you are able to establish that such a request was made, you are entitled to make the additional payment on occupancy. You were not entitled to elect to pay prior to the occupancy date.
If the appropriate request was not made during the 10-day period, you cannot now insist on the early payment, even though the developer has extended the occupancy date.
Q: Our board, as part of a $1.3 million building renovation, installed a new intercom system. Unlike the previous system the new intercom works through each unit occupant's own telephone. A large percentage of unit occupants have no phone service other than cellphones. They will have no intercom service unless they purchase a phone line or provide management with their cellphone numbers and that could mean additional cellphone charges every time they permit a visitor into the building.
Didn't the board require approval of this major change in a service by a vote of two-thirds of the unit owners? Can the board remove an important building service and require owners to pay to re-establish it?
A: The Condominium Act treats a change in a service provided to the owners in the same manner as a change to the common elements. If the estimated cost of the change is greater than 10 per cent of the current budget it is considered "substantial" and requires an affirmative vote of owners of at least 66 2/3 of the units.
Although opinions may differ, it is reasonable to conclude that the change in the system is a change in a service provided to the owners. It is unlikely that the cost exceeded 10 per cent of the budget. If not, and if the estimated cost in any month exceeded 1 per cent of the budget, the corporation was required to notify the owners advising of the estimated cost, how it was to be paid and advising that owners of at least 15 per cent of the units were entitled within 30 days of receiving the notice to requisition an owners' meeting to vote on the change. If there was a vote in favour or if owner approval was not required because the estimated cost in any month was less than 1 per cent of the budget, the change could be carried out notwithstanding that it required some owners to purchase phone lines or to incur cellphone charges.
Q: Our board bought a high definition, large screen TV for the party room. The board invited the unit owners to watch a rented movie. No admission was charged. One of the owners maintained this was illegal and we needed permission from the movie distributor. Did we?
A: This situation is identical to a unit owner inviting neighbours to the owner's unit to watch a rented movie. There was no illegality.
Write gerry@gerryhyman.com or fax to his attention at 416-925-8492. Letter volume prevents individual replies.
Lawyer Gerry Hyman is an expert in condominium law and appears Saturdays in New in Homes & Condos.
Toronto Star