In a recent Civil Resolution Tribunal (“CRT”) strata decision, a strata owner disputed fines levied against her for renting her strata lot out: Shen v The Owners, Strata Plan LMS 970, 2020 BCCRT 953. The strata was seeking to collect $19,500 in fines against the owner. 

In this case, the strata had a rental restriction bylaw wherein an owner required strata permission before renting their strata lot. In November of 2019, the owner was renting her strata lot, but never sought prior permission. November 29, 2019, the strata notified the owner of her breach of the bylaws. The owner didn’t seek permission and the strata followed up on the bylaw breach issue, and invited the owner to respond. The second letter warned the owner that council intended to impose retroactive fines to June 1, 2019 – this second letter was sent to the owner December 20, 2019. 

By the end of January 2020, the strata decided to fine the owner. Further discussions ensued and by April 21, 2020, the strata advised the owner that fines were imposed in the sum of $19,500, which was a fine of $500 every week back to June 1, 2019 to March 1, 2020. 

The CRT referred to the BC Court of Appeal case, Terry v The Owners, Strata Plan NW 309, 2016 BCCA 449 as the leading case on bylaw enforcement and fines. The CRT noted that the Strata Property Act and the Terry case do not address the issue of retroactive fines, but the Court of Appeal was very clear in the Terry case that, if section 135 of the Strata Property Act is not strictly followed, that is sufficient reason to set aside all fines that were imposed before the owner was given the particulars of the complaint and a reasonable opportunity to be heard including a hearing. “53. . . Here, [the owner] was not given the particulars of the complaint until the strata wrote to her on November 29, 2019. The November 29, 2019 letter did not advise [the owner] that retroactive fines would be imposed. It was not until later correspondence in December 2019 that the strata stated retroactive fines to June 1, 2019 would be considered. I find that section 135 of the SPA does not permit retroactive fines. I find the strata’s retroactive fine charges are akin to it charging fines before the strata had notified [the owner] of the particulars of the complaint. This is especially true given the November 29, 2019 letter did not address that bylaw fines might be charged retroactively.

54. I am satisfied the strata received a complaint about [the owner] renting SL 21. Based on Terry, I find the earliest date the strata could impose fines was November 29, 2019 as I find the strata’s letter of that date complied with section 135 of the SPA. Subsequent letters were exchanged and a hearing was held on February 10, 2020, also in accordance with section 135. I find the strata advised [the owner] of its decision to impose fines, albeit for an incorrect amount as discussed below, on April 21, 2020, which I find was reasonable under section 135(2) of the SPA. 

. . . 

 56. Strata bylaws 30(7) and (13) respectively allow for a find of $500 if an owner does not obtain permission of the strata council before renting their strata lot, and a continuing fine of $500 every 7 days for as long as the breach continues. Given this, I find [the owner] is responsible for an initial fine of $500 on November 29, 2019, and a continuing fine of $500 every week for 11 weeks until February 20, 2020, the date the Dispute Notice was issued in this dispute. This amounts to $6,000 and I find [the owner] is liable to the strata for this amount. I order the fines for [the owner’s] breach of bylaw 30 are reduced to $6,000.”

While CRT decisions are not binding, they are persuasive to another CRT adjudicator and this case gives owners and stratas guidance on how the issue of retroactive strata fees will be resolved in future claims. This also shows that, when an owner is breaching the bylaws, the strata should quickly take bylaw enforcement steps or they will lose potential enforcement power by having fines waived. 

Taeya Fitzpatrick

In my previous post: Improperly Charging Insurance Deductibles to Owners, I discussed several cases in the Civil Resolution Tribunal regarding strata corporations charging insurance deductibles to owners. 

Since that post, the appeal of The Owners, Strata Plan BCS 1589 v Nacht, has been completed and the strata corporation lost the appeal. 

In that case, water leaked from the Nachts’ apartment. The leak cost $87,000 to repair. The strata’s insurance covered the repairs, but the strata had to pay the insurance deductible of $25,000. 

The strata wanted the Nachts to pay the deductible, saying they were responsible for the water damage associated with the pipe failure. They based this upon section 158(2) of the Act, saying that the Act required responsibility, even though their bylaw required negligence before an owner had to pay the deductible.  

Or, they tried to say that the Nachts were negligent, and had to pay the insurance deductible based upon their bylaw. 

The Nachts denied they were negligent and said that they had to be negligent before the strata could charge the deductible back to them. 

The original CRT decision was issued on October 4, 2017, leave to appeal was granted on March 21, 2018 and the appeal decision was finally granted on October 18, 2018. 

Essentially, in this appeal, the Court’s task was to determine whether the CRT’s decision was reasonable. 

Although section 158(2) of the SPA only requires an owner to be responsible for the loss before the deductible can be charged back, the CRT found that the strata had narrowed that responsibility and made the strata only able to charge the deductible back if the owner was negligent. The strata, on the appeal, tried to argue that the CRT was incorrect in this decision. The Court found: 

[54] The CRT concluded that the Strata bylaw 4.4(a) augments s. 158(2) in a manner that does not contravene any provision of the Strata Property Act; furthermore, Strata bylaw 4.4(b), reasons the CRT, clarifies or “specifies” the basis upon which the phrase “if the owner is responsible for the loss of damage” in s. 158(2) is to be interpreted. This, in my view, is a reasonable interpretation and application by the CRT of both the enabling legislation and the bylaws in question; as such, the CRT’s decision ought to be upheld. In this context, to the extent the CRT’s interpretation is seen as narrowing the application of s. 158(2), it does not, in my view, meet the threshold of being deeply flawed such that it [sic] falls outside the range of a reasonable statutory interpretation.

Next, the Court had to determine whether the CRT interpreted the strata’s bylaw reasonably, the Court found it did. 

The final ground was whether the CRT reasonably followed the decision of Morrison: the Court found it did: 

[62] I am unable to conclude that the CRT acted unreasonably in considering Morrison. . . Furthermore, the language of the bylaw in Morrison mirrored that of the bylaw in the instant case. The language of the bylaw in Morrison also included the words “owner’s act, omissions, negligence or carelessness”. In this context, the relevance of Morrison in the instant case is patent. Perhaps, more importantly, the CRT does not mechanically apply Morrison, but rather carefully considers it applicability and notes both the similarities and distinguishing aspects of Morrison to the case before it. Again, I see no error of law or unreasonable conclusion by the CRT in this regard.

In the end, the strata’s appeal was dismissed and it owed court costs to the owners. 

This decision upholds a long line of decisions with similar results. The strata must have a properly worded bylaw or it may be unable to collect insurance deductibles from owners, even if the owners were ‘responsible’ because the strata raised the level of responsibility to actual negligence, intentional acts, etc. 

Again, it is for this reason that it is important for a strata to have properly drafted bylaws or they may be unable to enforce them the way they want/need to in certain circumstances. 

Taeya Fitzpatrick

Originally, anyone not happy with their CRT strata decision had to apply to the BC Supreme Court for leave to appeal the decision. As set out in my first post on this subject, there was a test to be met before the leave for appeal would be granted: 

(a) whether an issue raised by the claim or dispute that is the subject of the appeal is of such importance that it would benefit from being resolved by the Supreme Court to establish a precedent;

 (b) whether an issue raised by the claim or dispute relates to the constitution or the Human Rights Code;

(c) the importance of the issue to the parties, or to a class of persons of which one of the parties is a member; and

(d) the principle of proportionality.

Essentially, this created a separate hurdle to be overcome before the decision itself could be appealed. Once the test was met, then the appeal of the decision could go forward. 

Now, the interim step has been removed: people unhappy with their decisions no longer need to get leave to appeal. Now they file for judicial review. Quite a different process and certainly more streamlined (although not as simple as the CRT process) as the interim step no longer exists. 

 For some great resources on how to navigate the judicial review process see the below links: 

• http://supremecourtbc.ca/sites/default/files/web/Judicial-Review.pdf 
• https://www.bccourts.ca/supreme_court/self-represented_litigants/Judicial_Review_Package.pdf
• https://judicialreviewbc.ca/jr/

However, before starting the judicial review process, you may want to consult with a lawyer as to the merits of appealing your decision, expectations of outcome, etc.

Taeya Fitzpatrick