Western Canada Business Litigation Blog

How Should a Strata Deal with the Owner from Hell? – Part 2

Posted in Real Estate
Print Comment

In an earlier blog I discussed a B.C. Supreme Court decision involving problem strata owners who had, for years, defied efforts by the strata council to moderate their outrageous conduct.  The case was significant because the court ordered the strata unit sold as the only reasonable means of addressing the problems created by its owners.  The court held that it had jurisdiction to make this order under s.173 the Strata Property Act, R.S.B.C 1998, c. 43 (the “SPA”).  This was the first order of its type in B.C.

The miscreants appealed and the B.C. Court of Appeal just released its decision.  While not impressed in the least by the appellants’ conduct, the court allowed the appeal and set aside the order requiring the sale of the strata unit.  The court left in place the injunction requiring the appellants to abide by the bylaws and rules of the strata and, specifically, that they:

“are restrained from making loud noises, . . . making obscene gestures or uttering any abusive or obscene comments directed to any member of Strata Plan LMS 2768 or their families.”

The Court of Appeal rested its decision entirely on the interpretation of s. 173 of the SPA.  That section provides:

On application by the strata corporation, the Supreme Court may do one or more of the following:

(a) order an owner, tenant or other person to perform a duty he or she is required to perform under this Act, the bylaws or the rules;

(b) order an owner, tenant or other person to stop contravening this Act, the regulations, the bylaws or the rules;

(c)  make any other orders it considers necessary to give effect to an order under paragraph (a) or (b).

Relying in part on jurisprudence from other jurisdictions relating to similar strata legislation, the lower court found that subsection (c) gave it the authority to order a sale of the strata unit as a last resort in the face of incessant non-compliance by the owners. 

Frustratingly for strata councils but quite rightly, the Court of Appeal held that the legislation in other jurisdictions was not sufficiently similar to warrant support of such authority under the SPA.  Subsection (c) is designed only to enhance the efficacy of the two preceding section.  It is not a stand alone source of authority to order a sale.  Subsections (a) and (b) allow the court to order mandatory or prohibitory orders against someone regarding their obligations under the SPA, the strata bylaws or rules.  Those types of orders do not include an order for sale, at least not at first instance.

The Court of Appeal’s decision left open the question of whether an order for sale could be granted where an intransigent strata owner does not abide by orders made under subsections (a) and (b).  A failure to abide by a court order can result in contempt proceedings.  The unanswered question is whether an order for the sale of the subject strata unit is available as either a remedy for the contempt or to “give effect to” the previous orders.  The tenor of the Court of Appeal’s reasons suggests that this will likely be the case. 

As a parting shot, the court denied the appellants their costs because, though successful on the appeal, “it was their unsatisfactory behavior that triggered the decision of the strata council to take the action to deal with what had become a most distressing situation.”

The lessons for strata councils remain the same.  Seek the assistance of the courts sooner when faced with objectionable conduct.  Document well the impugned conduct and the strata’s efforts to address the problem.  Instead of a one-step route to the sale of a misbehaving owner’s unit, the courts are more likely to grant injunctive relief in the first instance seeking compliance.  If that fails, then the court likely has the authority to order the unit sold as the only practical method of remedying the situation where earlier orders have been ignored.