Monday, December 11, 2017

DID you agree to receive Notices via Electronic Transmission

We all agree E Mail is convenient

But sometimes a written letter; weighty in its importance will make you observe and deal with the contents.

If you agree to receive notice by email the importance may be missed or the JUNK folder filled.



RE:          New Lien Instruction Form  We attach here our new Notice of Lien/Lien Instruction Form. As you know, there have been some recent changes to the Condominium Act, 1998. One particular change which may affect the way lien notices are communicated to owners is the section governing Service on an Owner, Section 47(4). We will require you to complete the "Consent to Electronic Delivery" section of the instruction form, in the following cases:
  • where a unit owner has indicated, in writing, that they agree to receive service electronically; and/or
  • where the corporation has, on record, a duly completed "Agreement to Electronic Delivery".  (Must comply with Section 47(4), 47(6) of the Condominium Act, 1998, and 12.7 of O. Reg. 48/01.)
... office will send all notices by both mail and email, where an email address is provided.


 It is more convenient, but have you ever missed something important?  

What do you think? 





Tuesday, November 28, 2017

Court refuses to Amend Declaration of Condo Corporation

Do you have a unit at Toronto Standard Condo Corp 1556 Also Known As Skymark Center at Avondale - West Structure. Toronto Standard Condominium Corporation #1556. Address 78 Harrison Garden Boulevard?

Do you have a unit at Toronto Standard Condo Corporation 1600 Also known as  SKYMARK AT AVONDALE II, 80 HARRISON GARDEN BLVD, Toronto, Ontario?

Should you have known about this before your purchase? 

In a recent case, (TSCC No. 1556 and No. 1600 v. Owners of TSCC No. 1556, et al), the Ontario Superior Court of Justice refused to grant a court order to amend the declarations of two corporations to eliminate provisions in their declarations which specifically permitted transient, short-term rentals in the condominiums.
The two corporations were developed by the same builder and contained identical provisions in their declarations dealing with short-term rentals. The declarations specifically stated that transient short-term rentals were permitted in accordance with the applicable zoning by-laws. In addition, there were also numerous provisions in the declarations that any restrictions in the declarations were not to be construed to prohibit or restrict short-term rentals.
The condominium corporations took the position that the short-term rental provisions:
§ were inconsistent with the Condominium Act, 1998 (the “Act”) because they impermissibly granted rights relating to occupancy and use (when the Act only allows declarations to contain conditions or restrictions with respect to occupancy and use), and because they interfered with the ability of the board of directors to make rules;
§ were inconsistent with the City zoning by-laws; and
§ were inconsistent with a restrictive covenant registered against the condominium properties which prohibited the construction of commercial space.
All three of these arguments failed on the following basis:
§ The declarations did not grant any rights as the right to lease property is a right of ownership. The declarations merely confirmed that any provisions in the declarations which restricted uses, did not restrict the right to lease, and thus there was no inconsistency with the Act.
§ As section 58(2) of the Act specifically states that rules must be consistent with the declaration, the condominium boards clearly could not make any rules prohibiting or restricting short-term rentals, as this would be inconsistent with the declarations.
§ The wording in the declarations specifically stated that short-term rentals must be in compliance with the applicable City zoning by-laws in effect from time to time.
§ While short-term rentals of residential units may be a commercial use, this was not contrary to the restrictive covenant, as there was no construction of commercial space in the condominiums and the restrictive covenant did not prohibit leasing residential units for a commercial purpose.
§ The disclosure documents delivered to purchasers when they entered into their agreements of purchase and sale specifically stated that short-term rentals were permitted and some purchasers relied on the ability to lease their unit on a short-term basis when making their purchase decision.
As the court application failed, the only avenue to amend the declarations would be to obtain the written consent of the owners of 80% of the units in accordance with section 107 of the Act. Eighty per cent consent is a high threshold and often difficult to obtain. In this case, as the disclosure documents and the declarations clearly stated that there were no restrictions on the leasing of units, many of the owners may have relied on this when making their purchase decision, and thus would not consent to amending the declarations to prohibit or restrict short-term rentals. http://www.lashcondolaw.com/court-refuses-to-amend-condo-declaration-to-ban-short-term-rentals/ 



So these BUYERS who acted in good faith to purchase a suite for occupancy or investment;

a) Did they take the condo status documents to a lawyer to have it things explained?
     ....... 80 % do not  assuming that all condo documents are the same
b) Are you content to remain in your purchase?
c) Has your investment been soured by this experience?

Add your comments below 

Friday, November 3, 2017

A Guide to the New Condominium Act Forms

Nov 1,  2017
As of yesterday, many changes to the Condominium Act came into effect that affect the day-to-day responsibilities of condo corporations.
Some of the changes require corporations to use Ministry forms where they weren’t previously required.
The Ministry released the new forms corporations will have to use for: proxies, to provide notice of meeting, and the three types of information certificates, among others. Here is a list of the new forms:

Information Certificates
This “mini status certificate” provides owners with updates on finances, insurance, reserve fund, board, and other matters throughout the year.
Tip: This must be sent out twice per year – within 60 days after the last day of the first and third fiscal quarter.
This certificate is triggered on certain events, such as a change in the directors, or change of the corporation’s address for service.
Tip: There are different time periods for sending out the Information Certificate Update depending on the type of triggering event. For example, if the board loses quorum, this must be sent out within 5 days of losing quorum, whereas a corporation has 30 days to send out the notice for a mere change in the number of directors.
This notice contains the most recent Periodic Information Certificate and Information Certificate Update.
A corporation must send this notice to owners if it decides to post any of the information certificates online (such as through property management’s web portal)

Proxies
This form must be used by owners or mortgagees voting by proxy at a meeting of owners.
Tip: Proxy forms can be used at an adjournment of a meeting of owners. If, for example, there weren’t sufficient owners present at an AGM to pass a by-law, proxies submitted for the purpose of passing a by-law at that AGM can be used at a subsequent meeting of owners.
Notices
This notice is meant to give owners an advance notice of the purpose of the meeting of owners.
Tip: This must be sent out at least 35 days before the meeting date.
This form is required for sending owners notice of an upcoming meeting of owners.
Tip: This must be sent out 15-20 days before the meeting date.
Record Requests
This form must be used when an owner, mortgagee or purchaser requests records.
This form must be used by the board of directors when responding to a record request from an owner, mortgagee or purchaser.
Tip: The board must respond to the request within 30 days.
This is an agreement between the requester and the corporation that allows the requester to waive certain rights with respect to the corporation’s response to the record request.

Other Forms for Owners
1. Notice of Meeting of Owners under s.34(5) of the                                   Condominium Act
This must be used by owners who wish to call a meeting to fill vacancies on the board if the board loses quorum and the remaining directors do not call within 15 days of losing quorum, or if there are no directors in office.
This form must be used by owners if they wish to submit material to the board to be included in the upcoming Notice of Meeting of Owners
Tip: Although owners can request material to be included in the notice of meeting, the board is not obligated to include this material unless the submission is made on behalf of owners of 15% of the units (or more), and the submission would not add anything that is contrary to the Condominium Act or the regulations.


C/O Lash Condo Law 

Tuesday, October 31, 2017

Tax on Flipping 50%

David Rotfleisch, a tax lawyer with taxpage.com, said there are two ways in which a condo transaction could be taxable, either as capital gains or income.

“If you buy a condo and you live in it and you subsequently sell it, there is an argument that it is a capital transaction. You bought something and sold something,” he said. “But if you are buying paper and selling paper, there is no other argument than it is a debenture in the nature of trade and therefore fully taxable as income and therefore has to be fully reported. So anybody who has been involved in flipping condos or paper and who has not reported the transaction, is technically committing tax evasion.”

Denise Lash of Lash Condo Law noted the practice is common in the condominium industry.


Denise Lash, Lash Condo Law
Denise Lash, Lash Condo Law
“A lot of real estate agents or developers hold preliminary open houses for family and friends,” she said. “They get special pricing, hold on to it for three years and that’s when the assignment flip occurs. People will continue to assign, but the question is if they declaring that income.”

Lash said the CRA’s probe “makes sense” because of the issues in the marketplace.

“I would think no developer would take the position that anybody who’s making a profit on any resale shouldn’t pay tax. It should be handled the same way anybody else pays tax,” she said. “From the point of view of an investor who wants to assign, this shouldn’t discourage them — they should be disclosing and filing their taxes anyway.”

Both the Ontario and B.C. governments have given preliminary thoughts to creating some sort of registry system to track assignments in their provinces. But Rotfleisch said assignment sales have been a significant issue for years and feels any oversight should be done at a federal level due to the number of tax transaction reporting requirements involved.

“It is grossly overdue,” he said. “It is almost negligible on the part of CRA because it’s a well-known problem, it’s been a problem for years and it’s an easy fix.”

Csepregi said if there is reason to believe that a taxpayer has been noncompliant, their file will be referred for audit and may be reassessed based on the result.

“The CRA will apply a penalty equal to 50 per cent of the additional tax payable if a taxpayer knowingly makes a false statement when filing a return,” he said.

Flipping 


Do you have a condo you want to sell?

http://DavidPylyp.com 


Saturday, October 28, 2017

CRA chases flippers

“The profits from flipping real estate are generally considered to be fully taxable as business income,” CRA spokesperson Zoltan Csepregi told The Canadian Press via email. “The facts of each case determine whether such profits should be reported as business income or as a capital gain.” Real estate deals in the Greater Toronto Area and Vancouver have been the subject of greater scrutiny....


Didn't declare that flip?  

Time for a voluntary disclosure.

The Canada Revenue Agency is analyzing 2,810 transactions involving cases of pre-construction condominium flipping in Toronto to determine whether audits need to be carried out to find tax evaders.

In the Toronto area, audit work has picked up accelerated on what are called “assignment sales” or “shadow flipping”, in which a condo is purchased from a developer and sold to another buyer before the unit is completed.



http://www.mortgagebrokernews.ca/news/cra-analyzing-nearly-3000-condo-flipping-cases-in-toronto-232980.aspx

Fair or Foul? 







Thursday, October 26, 2017

Implementing Bill 160 Condominium Authority of Ontario (COA)

Laura McKeen %>
Laura McKeen
The condominium industry will be undergoing significant changes in the next few weeks. On Dec. 3, 2015, the Protecting Condominium Owners Act, also known as Bill 106, received royal assent by the Ontario Legislature. Bill 106 is important because it marked the first overhaul of the province’s condominium law in over 16 years. When it comes into force It will:

  • amend significant parts of the Condominium Act,1998 (the Condo Act);  
  • enact the Condominium Management Services Act (the CMSA);
  • make amendments to other relevant acts, including the Ontario New Home Warranties Plan Act.

Many important aspects of the reforms are being implemented through regulations, some of which have been released. Many of the changes to the Condo Act will come into force on Nov. 1, 2017. This includes those provisions dealing with the new dispute resolution tribunal, but will also likely include any provision addressed by the regulations released so far. The licensing provisions of the CMSA will also come into force. Importantly, Bill 106 also creates two new administrative authorities: the Condominium Authority of Ontario (CAO) and the Condominium Management Regulatory Authority of Ontario (CMRAO).

The CAO 

The CAO was designated on Sept. 1, 2017, and is responsible for the administration of certain parts of the Condo Act.  

Currently, there are no educational requirements to become a director of a condominium board. This is changing. The CAO will implement mandatory training for condo directors to ensure smoother operation of condo corporations. The CAO’s website provides information and training about: rights and responsibilities of condo owners; the roles and responsibilities of the board of directors and condo management; and changes to the Condo Act. Information is also available about common issues and disputes that arise in the condominium communities to assist owners and corporations in proactively resolving issues.

The CAO provides services and resources for condo corporations and condo owners. These include:

  • information to help owners and residents understand their rights and responsibilities;
  • mandatory training for condo directors;
  • resources to help condo owners and residents resolve common issues; and
  • dispute resolution services through the Condominium Authority Tribunal (CAT).

Starting on Nov. 1, 2017, the CAT will offer a new, online dispute resolution process. The CAT can only adjudicate the types of disputes identified in the regulations. Currently the only types of disputes identified are disputes about records (Section 55 of the Condo Act), but the CAT’s scope is expected to expand in the near future. Certain disputes are excluded from the jurisdiction of the CAT, including: disputes involving Part III of the Condo Act (ownership); liens; and the determination of title to real property. Where the CAT does have jurisdiction, it will have exclusive jurisdiction to exercise its powers. Appeals on questions of law will go to the Divisional Court.

It is expected that in early 2018 the CAO will also provide a publicly available, searchable, online registry of all condominium corporations in the province. In order to fund its services, the CAO will charge user fees and monthly fees to condo owners (currently $1 per voting unit). This fee will be payable through the condo corporation. All condominium corporations in Ontario are required to register with the CAO and pay their initial assessment fees by Dec. 31, 2017. The initial assessment fees will cover the period from Sept. 1, 2017, to March 31, 2018.  

The CMRAO 

On Nov. 1, 2017, the CMRAO will be designated as the condo management authority. The CMRAO will be responsible for administering the CMSA, including regulating and licensing managers.  

The CMRAO will be responsible for administering the CMSA, including:

  • a compulsory licensing system for condominium managers and condominium management providers; training, education and other requirements for condominium management licences;
  • a code of ethics;
  • regulation of the conduct of licensees; and
  • the handling of complaints about condominium management services.

Currently, Ontario has no minimum requirements for condominium property management companies or property managers. This will change on Nov. 1, 2017. Individuals and companies who provide condominium management services on or after that date will need to apply for a licence. As of Jan. 30, 2018, it will be illegal for any person or firm to provide condominium management services unless they have applied for or hold a condominium management licence. Illegal condominium management practice may jeopardize future licence applications.

Over the next few weeks, the condo industry will be adjusting to the new regulatory regime, including mandatory training, licensing and new dispute resolution systems. Even when these changes are made, Bill 106 will not be fully implemented. More changes will be coming as new regulations, guides and forms are released.

Laura McKeen is a partner with Cohen Highley LLP in London, Ont. Cohen Highley has offices in London, Kitchener, Chatham and Sarnia. She provides risk management and regulatory compliance advice to housing providers and property management companies. She can be reached at mckeen@cohenhighley.com or 519-672-9330 x 427.    https://www.thelawyersdaily.ca/realestate/articles/4919/implementing-bill-106-big-shake-up-for-the-condominium-industry-?nl_pk=d95c6284-5ba7-4473-8d78-cd2edd904169&utm_source=newsletter&utm_medium=email&utm_campaign=realestate


Laura McKeen

Tuesday, October 10, 2017

CRA Revenue Canada serves Condo Developer for customer list

There it is

YUP

Who purchased that Condo and then flipped it?

Developers have records and are now required to hand them over.


And several similar applications are under way, reflecting the federal government's efforts to crack down on potential tax cheating in the presale market.A July 25 Federal Court order requires the developers of the Residences at West, a Vancouver condo project at 1738 Manitoba St., to provide the Canada Revenue Agency (CRA) with documents related to presale flips, also known as assignments, in the building, including proof of payments and correspondence between the developers and people who buy the assignments.That order followed a June 29 application from the federal government.In September, the Minister of National Revenue applied for court orders related to One Pacific, a Concord Pacific project, and Telus Gardens, a downtown project developed by Westbank Corp.Both developers said they would comply with the request for documents."Customer information is protected by privacy laws and is not at the developer's liberty to disclose unless ordered by the Court," Matt Meehan, senior vice-president of planning at Concord Pacific Developments Inc., said in an e-mail.  https://beta.theglobeandmail.com/news/british-columbia/court-orders-developer-to-reveal-condo-flipper-info/article36528239





Where will you make extra money without tax? 
No where

Plan and manage your investments

Call David Pylyp
RE/MAX realty specialists inc.,
647 218 2414