Council must have owners approval to spend

Are we stuck with this?

Q&A: Council must have owners’ approval to spend

Tony Gioventu

Dear Condo Smarts: Since 1999, our strata owners have been fighting over whether or not to proceed with major repairs to the exterior of our building. Partial repairs have been done and some painting has been done.
   Now the owners have found out the council has signed a $75,000 contract for a contractor to work on windows and decks, without the owners’ aproval.
   We know we need major repairs, so why would we waste the funds on Band-Aids and decorating? Do we have to wait for our AGM to elect a new council? Are we stuck with this contract?
— Carol M. Surrey
Dear Carol: Strata corporations are a form of government, in many ways similar to local municipal governments.
We have legislation, bylaws, elections, budgets, levies, repairs and major projects. We also have disputes.
Strata councils have very specific limitations as to what they can spend, how to deal with emergencies and what approval is required by the owners before they can proceed.
   A contract would have required a time period to negotiate, which would likely have given the council plenty of time to convene a general meeting and get the owners’ approval.
   The Strata Act does give the council permission to spend unapproved funds but only under the following circumstances: Unless amended in a bylaw, up to $2,000 or five per cent of the annual operating budget.
   Emergencies may be expensed from either the reserve or operating funds.
   Your strata corporation may want to consider holding a special general meeting to make some decisions here.
   If major repairs are imminent, the owners may want to delay or stop the proceedings, if possible, or negotiate to serve the overall project better.
   The strata will definitely need legal advice on the contract and whether or not it is binding.
   The owners should also review whether they believe their strata council are protecting their interests and complying with the legislation.
In most cases, council can be removed and re-elected at a general meeting by a majority vote.
Tony Gioventu is the executive director of the Condominium Home Owners Association (CHOA). Contact CHOA at 604-584-2462 or toll-free 1-877-353-2462, fax 604-515-9643 or e-mail [email protected]