Devil is in the details of condo dispute

The phrase the devil is in the details is aptly applied to the Connaught Condo dispute.

Royal Connaught Inc. disclosed to prospective purchasers that it “… will be charging rent to the Condominium Corporation for the use of the Royal Connaught Grand Lobby…” RCI did not deliver a rental agreement, the condo corporation was not a tenant, not leasing the lobby. Instead RCI mandated or gave the condo “… a licence to use, access and enjoy the lobby for the purpose of ingress and egress …”

You agree to purchase a home. Except the seller will retain ownership and rent back to you the driveway. Days after you move in, you receive a licence agreement. You cannot park on or even stand idly on the driveway. You will remove all snow at your cost.

The seller writes the licence agreement giving it two days per month of exclusive use, including short-term use by others for, say, a movie shoot and keeping the income for themselves. And worse, after a year you learn they had wired the lighting and electrical services for the driveway to your electrical system, so you pay for that also. The seller has other properties to sell and the sales booth is on the driveway, so you also pay the property taxes for its use.

The licence agreement ends at 20 years. You have no renewal right and access to your garage and backyard could be lost forever afterwards.

Yes, the Grand Lobby significance was attached to all sales. Yes, it was to be rented to owners. Yes, it was a shock to learn it was not a rental, but only a right to walk through. Yes, the terms were shockingly different from the promise.

Why should the condo corporation should cry foul if they signed the agreement?

Well, because the persons who signed for both the corporation and RCI were the same people … both officers of RCI who were the “interim” board of the corporation on May 3, 2018.

Legislation allows owner elected boards of directors to terminate agreements the developer wrote before they took office where it is obvious those service arrangements tilt toward or blatantly benefit the developer over the interests of owners. That is, like the terms for the Grand Lobby licence.

Look at the shocking information above, which the owner board learned long afterward and only following significant research, and consider these question: Which of the Grand Lobby terms serve owner interests? Would you find it reasonable for the developer to switch out a rental agreement for a licence agreement that is only 20 years guaranteed? Is the fee paid by each unit equal to the benefit of walking through the lobby? What would your reaction be to learn the design and construction of the lobby placed the utility burden not on the lobby owner, but on owners?

WSCC 566 (Wentworth Standard Condominium Corporation 566) owner/directors took a lot of time and investigation to understand the complexities. They concluded the situation wanting, a lack of fairness and unacceptable cost/benefit to WSCC 566. They attempted negotiations with the developer and finding no middle ground, concluded negotiations were fruitless. They acted on those beliefs in the manner the Condominium Act allows, by terminating the agreement.

Those directors included highly respected owners with governance, real estate, property management, financial, accounting, marketing, and interpersonal skills. They used their experience, integrity and skills to do what was right for owners in terminating the Grand Lobby license.

The lawsuit reflects undeserved acrimony directed at WSCC 566 and its owners. The Grand Lobby was marketed as belonging to the residents, it the embodiment of grandeur for all owners, but its face was a mask. The lawsuit treats the lobby as an economic interest and not the heritage it was sold as being.