Attention to Detail Successful #253

Jun 01, 1996

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By Gerry Neely
B.A., LL.B.

A nominee who called to report the successful defense of an action for damages brought by a purchaser, thought that publication of the brief details might provide a welcome balance to the cases, in which occasionally the licensee has been found wanting. He was full of praise for the professionalism of his salesman, who was able to produce as evidence a diary in which he recorded the times, dates and contents of discussions and meetings.

In addition, he went beyond merely having the sellers tick the boxes in the Property Condition Disclosure Statements. He also had them place their initials beside each tick as confirmation that the sellers were aware of each representation they made. It was this carefulness and thoroughness that impressed the judge and won the case.

***

A strata corporation and a company related to the developer who constructed the strata building, signed a lease in favour of the company giving it the use of all of the parking stalls for 99 years. The lease was signed on behalf of the strata corporation by an individual employed by the developer, who did some work for both the strata corporation and the company holding the 99 year lease.

Some four years after this lease was granted the strata corporation, on behalf of the dissatisfied owners who said that they were unaware of the lease and that they would have to pay for parking, applied for an order to declare the lease void. They were successful for a number of reasons, including the failure to have the lease approved by special resolution, since it was a disposition of the common property in which both present and future owners have an interest.

The principal reasons, however, had to do with the uncertain authority the individual had to act on behalf of the strata corporation. His relationship with the developer and the holder of the 99 year lease created the potential for a conflict of interest. If he acted as agent for the strata corporation to manage it, the lease was not in the best interests of owners. His execution of it was a breach of Section 116 of the Condominium Act and of his fiduciary duties to the strata corporation.

While this case is under appeal, it is a further example of the difficulties described in Columns #180 and #185 of finding a method acceptable to a judge, by which a condominium developer can reserve control over the common property parking.1

***

There are a number of "illegal" suites in many homes in most communities in B.C. Generally, municipalities turn a blind eye to their existence and would only act on a complaint received by cityhall. When that happens, municipalities have a powerful remedy toprevent the continued renting of a building to more than one family.

In a Kamloops case, where a two-story house in a single-family residential zone was rented as an up and down duplex, following a complaint the owner was given two options. He could either convert the property to single-family occupancy, or seek approval for an amendment to the zoning bylaw to allow for a two-family dwelling in that location only. The owner was unsuccessful in his application to have the property rezoned and, following another complaint, the city applied for an interim injunction under Section 751 of the Municipal Act. It states that if a building is used in contravention of a bylaw, the municipality may commence court proceedings to prevent the continued breach of the bylaw.

In many instances where an injunction is sought by one person against another, the court will examine the balance of convenience in favour of either party, before deciding whether to grant the injunction. It may also look to see whether so many years have elapsed without any action having been taken to prevent the continuing breach that the application for the injunction should be denied.

Those arguments don't apply where the breach is one of a statute and the municipality was granted the injunction.2

***

With the exception of a contract for personal services, such as for example a contract with a singer or a hockey player, generally speaking, death does not frustrate a contract. That was the issue in a case in which a woman had made an offer to purchase property in her name alone. This was based upon an agreement with her partner, that both would contribute the down payment equally, obtain a mortgage which they would pay equally and register the property in their names jointly. If one died, the other would become the owner of the whole property.

Unfortunately, the partner died before the sale was completed. The estate of the deceased partner denied liability and since she was unable to complete the purchase, she negotiated a release from the seller. She then sued the estate for damages. No evidence was presented that the estate was unable to perform the partner's obligations. The trial judge had held that the death of the partner did not release the deceased's estate from liability. The Court of Appeal confirmed the trial judge's order that the estate pay her the amount of damages.3

  1. Strata Plan 1261 vs. 360204 B.C. Ltd., B.C.S.C., September 22, 1995.
  2. Kamloops vs. Baines, S.C.B.C., April 12, 1996.
  3. Butterfield vs. Todd, B.C.C.A., March 20, 1996.

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