Outstanding Maintenance Fees

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Sheryl
Posts: 1
Joined: 2008-02-14
Submitted by Sheryl on Thu, 02/14/2008 - 04:00.

There are many owners who have outstanding maintenance fees in my strata and I feel very frustrated that people aren't paying. I suggested cutting off people's gas (as that is included in our maintenance fees) but apparently we can't do that? I don't understand that since if they weren't paying Terasen, their service would be cut off?

I am very frustrated and feel there is nothing you can do as there are already liens placed on their mortgages! Is there anything else that you can do to get an owner to pay their maintenance fees?


advocate
Moderator
Posts: 27
Joined: 2007-11-29
Thu, 02/14/2008 - 19:15

In response to your posting I have some good news and some bad news.

The good news is that quite a bit can be done to force a strata owner to pay strata fees or a special levy. The bad news is that it probably requires a lawyer. The good news is that the Strata Property Act allows for "reasonable legal costs" to be added to the amount owing and recovered from the owner.

Acting on its own, through a lawyer or through a licensed strata manager the strata council can place a lien against the strata unit for which the fees are unpaid. After the lien has been filed and the fees remain unpaid the strata corporation can force the sale of the strata unit to recover the amount owing.

Very often, strata corporations are able to recover the amount owing by:

- threatening to place a lien on the property,
- if the property comes up for sale, disclosing to the prospective purchaser that fees remain unpaid and/or a lien has been place on the property,
- placing the lien and threatening to force sale to recover the amount owing,
- fining the owner for non-payment (if the bylaws allow for this),
-charging interest up to 10% on the amount owing (if the bylaws allow for it).

If you have a licensed strata manager he/she should be on top of this. If you are a self-managed strata I suggest you seek the advice of a knowledgeable strata lawyer. Be preapred to play "hardball" with those who have not paid their strata fees. They need to be made to realize that strata owners who are paying their fees are not a finance company for those who do not.


Dennis
Posts: 3
Joined: 2007-11-29
Wed, 02/20/2008 - 17:52

A few years ago, our strata passed a couple of extra bylaws that have been helpful in keeping arrears under control.

One bylaw (supplementary to Standard Bylaw 28) requires the strata to provide a report on arrears as an item on the agenda of annual general meetings immediately after the report on insurance.

The bylaw reads:
"report the total number of strata lots in arrears, and the total amount of strata fees and special levies in arrears as of the end of the fiscal year, if the meeting is an annual general meeting"

This bylaw provides an incentive to the Council, Property Manager and individual Owners to pay attention to arrears because they know that if arrears are getting out of line, the Owners at the AGM will demand enforcement action and the names of those who aren't paying their fair share of the bills.

The second bylaw prevents Owners in arrears from serving on Council because it's unwise to give such Owners the authority to decide how to spend the money of Owners who aren't in arrears.

The bylaw (supplementary to Standard Bylaw 11) derives its authority from the Strata Property Act, Section 28(3) and reads:

"despite any other bylaw, no person may stand for council or continue to be on council with respect to a strata lot if the strata corporation is entitled to register a lien against that strata lot under Section 116 of the Act."


Dennis
Posts: 3
Joined: 2007-11-29
Wed, 02/20/2008 - 18:59

I should have mentioned a third extra bylaw that helps our strata to manage arrears.

The bylaw (supplementary to Standard Bylaw 27) prevents owners in arrears from voting at general meetings and derives its authority from the Strata Property Act, Section 53(2).

In addition to a number of other benefits, the bylaw prevents Owners in arrears from voting against Owners who aren't in arrears who wish to take enforcement action to collect arrears.

The bylaw reads:
"The vote for a strata lot may not be exercised, except on matters requiring a unanimous vote, if the strata corporation is entitled to register a lien against that strata lot under section 116 of the Act."

Although these extra bylaws are subject to the conditions of Section 116, they are applicable in most typical arrears situations.


advocate
Moderator
Posts: 27
Joined: 2007-11-29
Wed, 02/20/2008 - 22:47

As a further deterrent to not paying strata fees a strata corporation can pass bylaws to levy a fine and to charge interest up to 10% on amounts past due.


Trisnic
Posts: 1
Joined: 2008-02-21
Thu, 02/21/2008 - 00:28

Have you tried talking to them and asking them why their fees have been unpaid?

I ran into a bad situation where I lost my business and could hardly even pay my mortgage. Cutting off my gas would have done no good because it was off for 8 months since I couldn't pay it. I lost almost everything. I went into arreas with the strata and began being charged a completely ILLEGAL "late fee" (which was not even in the bylaws and is against the BC strata act).

It is also illegal to reveal names of people who have not paid as it is against Canada's privacy laws. If you do this you could be fined millions.

Playing "hardball" is the worst idea and only makes you look like a complete bully. IT WILL ABSOLUTELY NOT HELP YOU GET YOUR MONEY FASTER. If I had been treated like a human and someone had written me a letter asking to please meet with them I would have done my best to pay my fees earlier. It would have meant not buying groceries but I could have dealt with that. As it was they just kept gouging and eventually put a lien on my property. This did not help them in ANY way and simply creates neighbor anamosity.

As it is my fees are almost paid off. I asked to them to please allow me to pay a reasonable amount per month, which is what I could afford, I stated that I would pay the 10% interest as well. I explained why I could not pay the full amount but they are all no-life pig-headed bullies who apparently can't even read and think money grows on trees. However, I have stuck to my end. When this is done I am suing them for the money they stole from me illegally, they can keep their 10% as that is fair. I consider everyone on that council to be complete scum for pretending to "deny" my completely fair request.

My point is, talk to your neighbors and treat them like humans, they probably have a valid reason for being in arrears and by treating them properly you will probably get your money. If you treat them poorly they will not pay.

In my job I work in escalations with upset customers all day and I have learned a lot about how people work, I know what I'm talking about.


advocate
Moderator
Posts: 27
Joined: 2007-11-29
Thu, 02/21/2008 - 01:50

If someone tells you that it is absolutely against privacy laws to reveal the names of strata owners who are in arrears on their strata fees, they don't know the law. In BC the privacy legislation does not apply where something is required by law which is the case under sections 35 and 36 of the Strata Property Act. You can find a lawyer's article on the right of access to strata information under the website: http://www.condohelp.org/

On this website, under Condo Chronicle, Legally Speaking - Document Access you will find the article.


Strider
Posts: 2
Joined: 2008-03-09
Sun, 03/09/2008 - 04:04

Years ago our strata corporation passed a bylaw which states that the corporation can charge owners interest of up to 10% on outstanding accounts. We are about to commence a small claims court action to collect the amount of fees, fines, and the lien charge on an outstanding account we are trying to collect. Although a bylaw allowing us to charge interest has been enacted, we question what authority allowed us to do that in the first place? We want to be prepared if we are asked this question. We know the Act gives the Owners the right to pass bylaws, but is a bylaw allowing us to charge interest enforceable? Is there any statutory authority which permits a strata corporation to charge interest? Has such a bylaw ever been judicially considered?


advocate
Moderator
Posts: 27
Joined: 2007-11-29
Sun, 03/09/2008 - 04:51

Section 107 (1) of the Strata Property Act enables a strata corporation to enact a bylaw whereby interest may be charged on late payment of strata fees. Section 107 (2) makes it clear that such interest forms part of the strata fees payable. Section 6.8 of the Strata Property Regulation sets the maximum rate for this interest at 10%. For your bylaw to be enforceable it must have been filed with the land title office in accordance with section 128 of the Strata Property Act.

I do not know if such a bylaw has ever been judicially considered but I expect it has. You may be able to find a judgement awarding interest under the provincial or supreme court registries which are accessible on line.


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