I wrote about “Peaches”, an “overweight” dog who was permanently evicted from the condominium corporation because the occupants failed to prove that Ms. Labranche had a disability requiring her to have this specific dog. The fact of the matter is that the dog exceeded the 25-pound weight restriction imposed by the condominium’s rules. Since then, the Court released its decision on costs. Unfortunately for Peaches and the owners, the story did not end well.
Indeed, the condominium corporation argued that it was successful on its application to obtain compliance and therefore was entitled to costs against the occupants on a full indemnity scale in the amount of $48,430, inclusive of HST and disbursements. As it is often the case in compliance matters, the condominium also argued that it would be unfair to the other innocent owners to have to bear any costs because of the occupants’ actions and omissions.
On the other hand, the occupants asked the Court to keep in mind their limited financial resources, the challenge of moving and their legitimate belief of potential success. They also argued that the corporation’s court application was premature and that the costs were disproportionately large.
The Court disagreed with the occupants and sided with the condominium corporation. In its decision, the Court wrote:
The [condominium corporation] was entirely successful. As such, it is presumptively entitled to its costs. The [occupants] were warned early on in the proceedings of the costs consequences should they be unsuccessful. The respondents refused the [condominium corporation]’s offer to take a reduction in costs if they would consent to an early judgment. The [occupants] were notified of the evidence required to establish a case of discrimination under the [Human Rights Code] but decided to follow the opinion of Ms. Labranche’s doctor as to the evidence necessary to succeed in their claim of discrimination rather than the principles established in the case law. Ms. Labranche’s position that she would not remove the dog without a court order was unreasonable. The [occupants]’ evidence was far from sufficient to support their claim of discrimination. There is no evidence before me as to the financial resources of the respondents.
Courts have addressed the scale of costs on a condominium application and accepted that full indemnity costs in cases such as this are appropriate. The respondents’ neighbours are blameless in this matter; it is not fair or equitable for other unit owners to have to subsidize the costs of the condominium corporation in pursuing a legal proceeding against a unit owner for their breach of the condominium rules.
At the end of the day, the Court ordered that:
- The occupants pay the condominium corporation $47,000 in costs including HST and disbursements within 20 days of the date of the order (this amount was later reduced by the Court to $45,750 in a supplementary costs endorsement);
- In the event that the costs are unpaid by the occupants within the 20 days, the costs shall be added to the common expense of their unit and there shall be a lien and charge upon their unit pursuant to section 85 and 134(5) of the Condominium Act, 1998; and
- The interest is payable on the amounts outstanding in accordance with the condominium corporation’s by-laws with respect to unpaid common expenses.
Owners and occupants should always think twice before challenging a compliance application commenced by their condominium corporation, especially if they do not have all of the required evidence. The risk is that they may end up facing a steep costs award since courts will not hesitate to impose costs on the delinquent owner or occupant in order to spare the other innocent owners. However, and unfortunately, it appears that courts are reluctant to apply the same logic the other way around when owners are the ones seeking compliance from the condominium corporation. Often in those cases, the innocent owners who brought the court application are not fully indemnified and end up being out-of-pocket. This inequity may be resolved when the new Condo Act comes into force.