In the first case of its kind, the BC Supreme Court assessed the amount legal fees payable to the Strata Corporation from the owner that breached the Strata’s bylaws: The Owners, Strata Plan K 27 v. Caron, 2019 BCSC 1046.
In this case, the Strata sued the owner to enforce its bylaws and to evict the owner. The Strata was successful, the court found that the owner breached the bylaws, ordered the owner to stop breaching the bylaws.
The court also ordered the owner to pay the Strata’s “reasonable legal costs”.
The term “reasonable legal fees” was interpreted in the case of The Owners, Strata Plan KAS 2428 v Baettig, 2017 BCCA 377, which was discussed in my blog post: Can a strata collect full legal fees when collecting on a strata lien?
As the strata was entitled to “add to the amount owing under any lien its actual legal costs subject to one qualification: those costs must have been reasonably necessary.” Therefore, the issue before the Court in Caron was “to determine legal costs, fees and other disbursements which have been reasonably incurred in prosecuting the” enforcement of the bylaws.
The strata in Caron was seeking the sum of $38,343.28 in legal fees and disbursements from the owner. The owner disputed the amount saying that the fees, hourly rate, and travel costs (such as airfare) should be reduced because the Strata hired out of town counsel. The owner also disputed the cost of an RCMP report saying that it was an extravagance and unnecessary.
The Court noted:
“ While the [Strata] has the obvious right to obtain counsel of its choice, it is only entitled to be reimbursed legal fees and disbursements which are reasonably incurred.”
On that basis, the Court did reduce certain charges and legal fees. The Court found that the Strata’s lawyer, who charged $450 which was increased to $475 per hour was substantially higher that rates charged by counsel with his experience. The Court then stated that a reasonable hourly rate for senior lead counsel in the Kamloops are would only be in the range of $350 per hour – a fairly substantial reduction. As a result, the claimed legal fees were reduced from $24,060 to $15,000.
After the disbursements were reduced for the RCMP report that the Court agreed was unnecessary, the claimed total of $38,343.28 was reduced to approximately less than $22,000. While substantially reduced, is still better recovery of the legal fees than if the Strata was limited to the usual Court costs recovery scale.
This will, certainly, set a precedent for Strata’s to consider when enforcing bylaws against owners or recovering legal fees for lien enforcement proceedings and how their legal fees will be recovered.