Is your condo board above board? Tips for evaluating condo governance
By Solomon Israel
23 May 2017
Condominium governance is in the spotlight after an investigation by
CBC Toronto reporters unveiled questionable practices at a series of
downtown Toronto buildings.
Owners and property managers in those buildings say a group of people
have aggressively sought control of the boards and budgets of multiple
condos. The allegations include voting irregularities and contentious
If you're wondering whether your condo board is operating in a
trustworthy manner—or if you simply want to get a better grip on how
your condo works—here are a few tips from experts in the field of
Learn who runs the place
Not just anyone should sit on the board of directors of a condo corporation, experts say.
"You want people who are financially literate, who have some business
experience, preferably," said Audrey Loeb, a lawyer with Miller Thomson
who specializes in condo law.
"You don't want the board of directors managing the building, you want the board of directors overseeing the manager."
That property manager should be independent of the board, with a good reputation, Loeb added.
Condo board directors should own a unit in the building, and ideally
live in that unit, said Loeb. If not, that's a potential red flag for
Conflicts of interest on condo boards are another red flag, according
to Brian Antman, who audits condo boards as a partner with accounting
firm Adams and Miles and serves as a director of the Canadian
Condominium Institute's Toronto chapter.
Board directors shouldn't have any financial interest in transactions
with the property manager or their vendors, Antman said. Directors, he
added, should also sign and follow a code of ethics.
Put on your reading glasses
Condo owners ought to take the time to read their building's
declaration, said Antman. (A declaration is essentially a condo's
charter or constitution.) They should also read any bylaws and rules
instituted by the board, according to Antman.
Potential owners of new condo buildings need to read the disclosure
statement provided by the developer, and should have it reviewed by a
lawyer with experience in condo law, Antman said. (For resale condos, a
"status certificate" replaces a disclosure statement.)
"It's probably the most significant purchase they'll ever make, and
they shouldn't be surprised by anything going into it," he said. "I see
a lot of people who don't do their due diligence up front, and are
Communicate with the board, and participate
"The best way to tell how well-run your condo is… is to ask for
documents, and see if you get them," said Loeb, the condo lawyer.
Minutes of board meetings are a common record that a board should share.
"If you get them in a timely fashion, ask for the monthly financial
statements," said Loeb. "Any owner is entitled to see that stuff."
Most condo board meetings are closed, but Loeb said owners should absolutely take the time to attend annual meetings.
If owners can't attend an annual meeting but still want to vote on
condo issues by proxy, Loeb recommends electronic proxy voting, by
which proxy documents are emailed directly to owners.
If a condo owner is concerned about their condo corporation's board, they can try to shake things up.
"If they're unhappy with the board, or a board member even, they can
requisition a meeting to replace the board or the board member," said
The owner can even try and join the board themselves, if they feel up to the task.
"This is their biggest investment, and if they want it to be run properly maybe they need to get involved," Antman said.
Be warned, though: sitting on a condo board can be "a hugely time-consuming job, if it's done well," said Loeb.
"People have no clue what hard work it is, especially in the first two
years of a condo's life when you're just trying to figure out what's
going on," she said.
Make sure professionals are involved
Good condo administration often requires professional expertise, said Antman, an auditor.
"The [condo] corporation should hire a solicitor, an auditor, an
engineer who's doing the reserve fund study," he said. "And all of
these people that you're hiring should be people that are experienced
in the industry."
A solicitor is especially important when things go wrong, said condo
lawyer Audrey Loeb, who described how condominiums have become "very
complex entities" over the years.
"My philosophy has always been that the condo is the fourth level of
government," said Loeb. "After the feds, the province and the city,
you've got your condo [corporation]."
Comments from readers
Condo boards should operate more like municipal councils. All members
should be required to be both owners and residents, agendas should be
published ahead of time, meetings should be open to all residents to
observe, there should be an opportunity for residents not on the board
to make presentations, and minutes should be freely available to all
residents and prospective purchasers afterwards.
Strata living is a failed social experiment, at least in BC... the best
advise is to STAY AWAY.... this CBC article, like so many articles on
Strata/Condo living ends the same as all of them, suggesting that you
hire a lawyer... at your own expense of course, to fight with your
Strata Corp that uses again YOUR money to fight back, plus they have
errors and omission insurance for council (board) members and council
members are often protected by the insurer even when there is blatant
fraud (which they are not supposed to cover) and as is described so
well by posters on the Facebook page that is now becoming very popular.
(see Strata Theft and Bullying website on FB)
Also...be wary of moving into a condo building where no one wants to be on the board but the building is full of whiners.
One thing that was missed in an otherwise good article, is the condo
fee. Low fees ($200) means you have a condo running on the warranty and
that warranty is good for about 2 years. If so, be ready for a massive
hike in maintenance fees. If it is an older condo and still has low
fees, really look out for surcharges being slapped on for repair items
such as roofs and landscape and especially, under ground parking lots.
The average price I have seen for maintenance fees runs between
$600-$800/month. A lot of that depends on the services being offered.
No pool or gym or meeting rooms etc, just basic housing that is kept
clean and safe will be around $600.00/month.
The big thing is to do the your diligence and I love the part about the
paperwork. I had one place look at me like I asked to have sex with
their granddaughter in the lobby when I asked for copies of their
by-laws and the last years financial records. Guess who didn't move in.
The entire real estate industry from home buyers and sellers, to condo
boards through to agents and lenders to oversight agencies needs to be
investigated thoroughly. Where there is money to be made, there is
often corruption and malfeasance.
I live at the Barriefield, a condo in Kingston where the manager hired
his brother in law without tender to redo the main floor & party
room decoration. The board also gave without tenders: contracts for the
replacing of all plumbing lines (over $500K) and balconies repairs
(over $300K), despite our corporation having a purchasing policy that
requires tenders for anything over $50K.
When I found suspicious transactions for money spent in the suite of an
executive, I asked for a meeting with the board. Instead, they hired
the lawyers at a cost of over $13K to try to justify the expense of
$350, then asked me to pay for those legal fees. I fought them and won.
I have since been made to be the villain through an extensive campaign by the board to isolate me. I could write a book.....
Who would want to buy one of these things? It's like buying a headache!
I could understand if your only intention was to flip the thing, but to
live in one? Dear lord!
Especially in Vancouver, you'll be spending a small fortune to buy a
room in a building that you don't technically own. You can be evicted,
or worse, you could be saddled with huge bills as a result of poor
management. If the cost was what is was 10 years ago, it made sense...
Today? At the price these shoe boxes are going for...
My first AGM I went to a guy had a couple beer he brought with him. He
popped his first when they called the meeting, and I didn't get it.
Thought maybe he had a drinking problem...nope, turns out he just
brought a brew to the best show in town. Yelling, pointless questions,
pettiness, avoiding answers, extreme examples of mismanagement and
cluelessness—condo meetings can't be beat for those of you into trash
Edward (E) Merij
I was at a condo meeting in Florida a few years ago and a fight broke
out. And I mean a fistfight. And who was it between? Two ladies.
It is about time the the provincial government should revise the condo
act. Condos used to have small numbers of units. Now condos have over
300 units at some downtown locations, Money attracts speculators.
At the last board meeting where election was held at Five Condo
the three persons who ran aggressively to be in our condo board claimed
they own the same unit but CBC revealed only Mr MacGregor is a
registered owner. So they were not truthful and voters had no means to
check at the time of voting. I was still appalled how three people in
one living unit can run for the board of director position. The proxy
votes were never revealed at the meeting.
These were serious flaws. The province should change laws/Condo Act to
ensure that owners in each unit should have a bill of rights. Board
members should live in the condo and there should be one candidate per
unit to be a member of the board. The election of board members is a
democratic process and it fair representation and honesty should be the
Condos are not something I want to be involved with.