Bill 106 - Condominium Management Services Act

Bill 106 contains proposed legislation that will amend the current Condominium Act and create a new Condominium Management Services Act.

Condominium Management Services Act and Regulations

The Condominium Management Services Act will introduce compulsory licensing for “condominium managers” and “condominium management provides”, as well as mandatory training and education, and introduce a code of ethics.

The regulations that will be created under the Condominium Management Services Act will set out the qualifications to be a licensed “condominium manager” and “condominium management provider”, the process to be followed to obtain a license and the transition periods for compliance with the new licensing requirements. The regulations have not yet been created, but it is our understanding that they will be created within the next 18 months.

Licensing

The Condominium Management Services Act prohibits persons from providing “condominium management services”, unless they are licensed, as a “condominium management provider” or as a “condominium manager”. “Condominium management services” are defined under the Condominium Management Services Act as services that include the collection of common expenses, exercising the duties and powers of a condominium corporation as delegated by the condominium corporation’s board, making payments to third parties, negotiating and/or entering into contracts on behalf of a condominium corporation, and supervising employees and/or contractors retained by a condominium corporation.

An exemption to the general rule that persons providing “condominium management services” must be licensed, is that a license will not be required to provide “condominium management services” by persons or in circumstances that will be prescribed by the regulations. Since the regulations have not yet been created, we are aware of what the exemptions to the licensing requirement will be; however, it is presumed that self-managed condominiums corporations will be exempt from the licensing requirement.

Administrative Authority

The Condominium Management Services Act will be administered by a new administrative authority that will be an independent, self-funded and non-profit corporation. It is our understanding that the new administrative authority will initially be funded by the government and after the initial start-up funding, will be funded by the licensing fees collected from “condominium managers” and “condominium management providers”.

Complaints

Under the Condominium Management Services Act individuals will be able to submit complaints to the registrar appointed by the administrative authority. Although anyone will be able to submit complaints, including individual owners, because a property manager acts upon the direction of their condominium corporation’s board of directors, in order to make a valid complaint individuals must be able to establish that their property manager did not act in accordance with the instructions provided by their condominium corporation’s board of directors. Accordingly, board members, will be best suited to submit complaints. In this regard, it is presumed that if an owner were to file a complaint with the registrar, the registrar would likely advise the owner that their condominium corporation’s property manager acts upon the direction of their condominium corporation’s board of directors, and if the individual has a complaint regarding the instructions provided by their board of directors to their property manager, the individual should direct their complaint to the condominium authority to be created under the amendments to the Condominium Act.

If the registrar receives a complaint that is within its jurisdiction, the registrar can: attempt to mediate the complaint; provide a written warning the “condominium management provider” or “condominium manager”; require that the “condominium manager” or “condominium management provider” take further educational courses; refer the complaint, in whole or in part, to the discipline committee to be created; and/or revoke, suspend or refuse to renew a license, or impose conditions on a license. However, prior to revoking, suspending or refusing to renew a license or imposing conditions on a license, the complaint must be heard before a tribunal to be created under the Condominium Management Services Act, and the “condominium manager” or “condominium management provider” at issue must be provided with advance notice of the hearing. At the hearing, the tribunal can either uphold the registrar’s order or substitute the tribunal’s own order for that of the registrars.

Code of Ethics

The Condominium Management Services Act also provides that a code of ethics will be established by the regulations, and that a discipline committee will be set up to review all code of ethics violations.

If the registrar refers a complaint to the discipline committee, the discipline committee will hear the complaint and make a determination on whether the “condominium manager” or “condominium management provider” at issue has failed to comply with the code of ethics.

If the discipline committee finds that a “condominium manager” or “condominium management provider” has failed to comply with the code of ethics, the discipline committee can order the “condominium manager” or “condominium management provider” to take further educational courses; fund educational courses; pay a fine up to a maximum of $25,000 or another amount as may be prescribed by the regulations; fix and/or impose costs; and/or postpone or suspend the taking of any further courses or the funding of any further courses.

How will the new Condominium Management Services Act affect you?

At this time it is unclear how the new Condominium Management Services Act and the regulations made hereunder will affect individual unit owners, condominium corporations and boards of directors. However, it is presumed that the costs incurred by the “condominium managers” and “condominium management providers” will be paid indirectly by their customers through increased fees for “condominium management services”, and that this in turn will increase common expenses.

All of the information contained in this article is of a general nature for informational purposes only, and is not intended to represent the definitive opinion of the firm of Elia Associates on any particular matter. Although every effort is made to ensure that the information contained in this newsletter is accurate and up-to-date, the reader should not act upon it without obtaining appropriate professional advice and assistance.

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