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News archive for February 12, 2014

Pay up your fees, court orders condos’ developer

Condominium owners found restitution this week, as a Yukon Supreme Court judge ordered a Copper Ridge developer to fork over nearly $400,000 in unpaid fees.

By Christopher Reynolds on February 12, 2014 at 4:50 pm

Condominium owners found restitution this week, as a Yukon Supreme Court judge ordered a Copper Ridge developer to fork over nearly $400,000 in unpaid fees.

In a ruling that resolved the bulk of a long and acrimonious housing dispute and offered lessons for homeowners and developers alike, Justice Ron Veale said the Falcon Ridge condo corporation was entitled to $394,000 — plus some legal costs — because developer Brian Little failed to pay his share for units his company owned.

“I find from the evidence that there was no agreement between the condo corp. and the condo developer that the condo
developer was not required to pay condominium fees,” states the decision.

“There was clearly a practice by the condo developer not to charge itself condominium fees when it was in de facto control of the condo corp. (from 2005 to 2011).”

That practice was in “direct conflict” with a board declaration from 2005 — when the subdivision and its board were created — which states the developer “shall pay to the corporation his proportionate share of the common expenses ....”

Helen Booth, the condo board’s president, supports the court decision, handed down Monday.

“I think Judge Veale was fair. He was careful to avoid a windfall payment, and that’s not what we were looking for,” she said, despite the owners having asked for $2.6 million in outstanding fees, penalties and accrued interest.

“Judge Veale made it very clear that condo developers, because they are owners, have to pay condo fees,” she said in an interview with the Star today.

“I think this is a pretty clear message to condo developers across the territory that they need to start paying condo fees, and I think that condo boards need to look at this decision very carefully.”

Booth pointed out that developer-owned homes, occupied or not, become units within the condo corporation “as soon as title is raised,” and that the owners owe condo fees from that point on.

Little had argued that he and the condo corporation had agreed that he was not required to pay fees on its units “until they were sold or leased.”

The judge rejected that argument outright, citing the board’s original declaration and bylaws.

Sonny Gray, president of the Yukon Condominium Homeowners Association, sees the case as a warning to all parties.

“The whole Falcon Ridge development served as a perfect example of a worst-case scenario. And I’m glad that the judge came out and called it like it was,” he told the Star today.

“There’s almost a sense of entitlement: ‘I built this thing, I shouldn’t have to pay fees.’”

Condo fees go toward common expenses like waste and snow removal, insurance, lighting and maintenance.

Gray warns home buyers to read their declaration and bylaws so they know what they’re getting into before purchasing a new place.

He also wants to see legislation, currently in the works, that makes condo owners tougher prey for exploitative developers.

“It’s going to improve things right across the board,” he said of the prospective Yukon Condominium Act, which he hopes to see unveiled as a rough draft this fall.

Ideally, the act would set more rigid standards on fee hikes and obligate developers to pay into condo board coffers even if the units are unoccupied, Gray said.

“It’s being done like that down south (in B.C.), but right now up here, it’s buyer beware.”

He noted several developers in Whitehorse are building responsibly, and even progressively, with Evergreen Homes and Construction hardwaring units in Whistle Bend for solar panelling.

James Tucker, the condo board’s lawyer, told the Star that in the wake of their legal victory, Falcon Ridge homeowners could use their $400,000 several ways.

“That’s up to them .... The money will be used for the benefit of the owners one way or the other,” he said.

The cash could be divided evenly among the owners of the 78 units in Falcon Ridge or put into a reserve fund for future use.

Gray estimated between $30,000 and $40,000 in legal costs were also destined for owners’ bank accounts, though the exact amount is still being calculated.

Like Gray, he stressed the importance of knowing your governing documents.

“Every condo corporation is governed by its own declaration, and they’re not all the same.

“I think the point is that condo corporations have to enforce their declarations. That includes the collection of condo fees. And if a party is required to pay it, the party has to pay it.”

Little, also the developer behind the Mountain Air Estates complex off Mountainview Drive, did not return the Star’s calls by this afternoon’s press time.

The legal battle between the owners and Little entered its end game last month with another Yukon Supreme Court decision that may yet see a Falcon Ridge disputed, “half-decrepit” apartment complex torn down.

Veale sided largely with the condo owners’ complainants on that front too.

He ruled “it would be unjust and inequitable to the majority of unit owners that oppose the condo developer’s proposal to allow it to proceed with the construction” of the building.

In July 2012, Little began construction of a now partially completed three-storey complex — and has since sunk more than $1 million into the project — despite not having consent from nearby condo owners concerned about property values and “community cohesion.”

The condo board felt the cube-like structure — initially slated for four storeys with 24 units — would have the effect of “destroying the character of the development that unit owners found to be so attractive in the first place,” Veale said.

Booth agreed.

“The crux of it was that in the plan up until 2012, there was basically no mention of this ... the crucial point there being that consent from owners was not obtained,” she said in an interview.

The subdivision’s declaration and plan from 2005 include only detached houses, duplexes and rowhouses.

Any exceptions — like an apartment block — require amendments to both documents, and must be agreed to in writing by each homeowner.

The structure is “half-decrepit” and an “eyesore,” one homeowner said in court last year.

In January 2013, the judge ordered a halt to all construction on the building, which has stood vacant ever since, its framing and particle boards exposed to the elements.

Veale ruled that a combination of four-plex and single-family units could take the place of the apartment.

Little has 90 days from the time of the ruling to submit a new plan for the parcel.

CommentsAdd a comment

June Jackson

Feb 12, 2014 at 6:03 pm

I have issues with landlord greed to begin with..and this is a perfect example of what happens when greed comes up against people who have the wherewithal to fight back. 

Most of us are just victims..we don’t have the money to challenge anyone in court.  The bigger or richer the enterprise the less likely they are see legal action.
There are probably a lot of folks like Mr. Little who should be facing suits..but won’t.

flyingfur

Feb 13, 2014 at 10:50 am

How about we use the money to sue Little again to finish all of the grounds and driveways he has not finished yet and get a firm date on when he will have that done?  Several homes here have gone without grass and pavement for 2 years…while paying condo fees for lawn maintenance when they have no lawn.

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