Oppression: Condo Owner Blocked from Selling Parking Together with Unit

A developer built a condominium project consisting of two buildings side-by-side.  A couple bought a residential unit in one building, but were forced to buy a parking space and storage unit in the adjacent building since there were none available in their own.  They were the only owners who had to resort to this arrangement, but nothing in the condominium declaration prevented it at the time.

About five years later – in response to residents’ concerns about parking area safety – the condominium declaration was amended to prevent parking and storage units from being used or owned by anyone who was a non-resident.    The practical effect was that these two particular  owners were prevented from selling their parking and storage units in the adjacent building to anyone who wanted to buy their residential unit.

Although the condominium corporation grandfathered these owners’ existing use of the parking/storage while they lived there, problems arose when they wanted to sell:   In light of the amended declaration, their only option was to try to sell the residential unit separately from the parking and storage units.

For almost two years the owners tried to do so, but without success.   In fact, they did not receive even a single offer.  Other units in the same building were marketed and sold within that same time-period.

The owners took the condominium corporation to court, claiming they had been unfairly prejudiced or oppressed by the amended declaration.  In good faith, they had bought the residential unit in one building and the parking/storage in another, reasonably expecting to be able to sell them later as a single package.  They therefore asked the court to order the condominium corporation to amend the declaration to remedy this impasse.

In considering their claim, the court confirmed its power under the Condominium Act, 1998 to remedy situations where the corporation’s conduct is oppressive or unfairly prejudicial to an owner.  In this context, oppressive conduct is anything considered “burdensome, harsh and wrongful” or an “abuse of power”; it is also conduct that undermines the owners’ reasonable expectations or unfairly disregards their interests.

The court found that:  1) without parking and storage, the owners’ residential unit was virtually unsellable; 2) the owners had purchased in good faith; and 3) they would not have done so had they known that they would be unable to sell later on.

While the condominium corporation may not have specifically intended to harm these owners with the amendment, this was still the net effect.  They were the only ones with a residential unit in one building and parking/storage in another and became the only ones unable to sell them together as a package.   Ultimately, this meant they did not have the same rights as other owners.

After finding that the amended declaration was oppressive, prejudicial and unfairly disregarded the owners’ interests, the court ordered a further amendment to allow the sale of the residential unit and parking/storage to a single new buyer.  See Grigoriu v. Ottawa-Carleton Standard Condo. Corp. No. 706, 2014 (ONSC).