Date Issued: November 20, 2018

 

File: ST-2017-007550

Type: Strata

Civil Resolution Tribunal

Indexed as: 901 Fernie Property Developments Ltd. v. The Owners, Strata Plan NES 3363, 2018 BCCRT 750

Between:

901 Fernie Property Developments Ltd.

Applicant

And:

The Owners, Strata Plan NES 3363

Respondent

REASONS FOR DECISION
Tribunal Member:	Vivienne Stewart

INTRODUCTION

1.      The applicant, 901 Fernie Property Developments Ltd. (owner), owns strata lots 24 and 25, which are the only commercial units in the respondent strata corporation, known as The Owners, Strata Plan NES 3363 (strata), in Fernie. The strata was created in December 2007. It is made up of 4 buildings which were completed in 4 phases. The owner’s strata lots are located in the last building constructed, known as building A, which also contains 24 residential units. The other 3 buildings contain 20 residential units for a total of 46 strata lots in the strata.

2.      The owner was also the owner developer of the strata. At the same time the strata was created, 2 separate sections were also created: the residential and non-residential (commercial) sections.

3.      The main dispute is about the strata assessing strata fees based on all operating expenses in its budget, without allocation between the two sections. The owner says that the strata treats the owner, as the only owner of commercial section units, unfairly, particularly in the way it assesses common expenses from which the owner says it derives no benefit.

4.      The applicant is represented by its principal.  The respondent is represented by a member of strata council. All members of strata council are residential strata lot owners.

JURISDICTION AND PROCEDURE

5.      These are the formal written reasons of the Civil Resolution Tribunal (tribunal). The tribunal has jurisdiction over strata property claims brought under section 3.6 of the Civil Resolution Tribunal Act (Act). The tribunal’s mandate is to provide dispute resolution services accessibly, quickly, economically, informally, and flexibly. In resolving disputes, the tribunal must apply principles of law and fairness, and recognize any relationships between parties to a dispute that will likely continue after the dispute resolution process has ended.

6.      Under section 10 of the Act, the tribunal must refuse to resolve a claim that it considers is not within the tribunal’s jurisdiction. A dispute that involves one or more issues that are within the tribunal’s jurisdiction and one or more that are outside its jurisdiction may be amended to remove those issues that are outside its jurisdiction.

7.      The tribunal has discretion to decide the format of the hearing, including by writing, telephone, videoconferencing, email, or a combination of these. I decided to hear this dispute through written submissions because I find that there are no significant issues of credibility or other reasons that might require an oral hearing.

8.      The tribunal may accept as evidence information that it considers relevant, necessary and appropriate, whether or not the information would be admissible in a court of law. The tribunal may also ask questions of the parties and witnesses and inform itself in any other way it considers appropriate. At my request, the parties in this case provided additional evidence and submissions relating to the calculation of expenses which I have found that the strata should not have charged to the commercial section.

9.      Under section 48.1 of the Act and the tribunal rules, in resolving this dispute the tribunal may order a party to do or stop doing something, order a party to pay money, and order any other terms or conditions the tribunal considers appropriate.

ISSUES

10.   The issue in this dispute is as follows:

a.  Has the strata treated the owner significantly unfairly since 2011 by improperly requiring the owner to contribute to common expenses that relate to and benefit only the residential section owners? If so, what is an appropriate remedy?

BACKGROUND AND EVIDENCE

11.   I have only commented upon the evidence and arguments that are necessary to give context to my reasons.

12.   The strata was created with 2 sections. The strata’s bylaws specifically refer to the separate sections and set out their powers and duties.

13.   The strata’s fiscal year runs from July 1 to June 30 of the following year.

14.   Under the Strata Property Act (SPA), separate sections have their own strata councils and budgets, their own contingency reserve fund (CRF) and their own operating fund. Expenses that are common to both sections are included in the strata’s budget. However, this is not the way the strata has operated.

15.   The evidence shows that the strata historically presented its budget in a ‘types’ format, with common or joint expenses and residential and non-residential expenses appearing in one budget. The separate sections did not prepare separate budgets for expenses relating only to the particular section. It was only in 2014 that the residential section began having its own council meetings and annual general meetings (AGMs). The recent strata budgets are noted as being “(common)” and show “total common area expense”.

16.   The relevant parts of the strata’s current bylaws, which were approved and filed on December 13, 2007, are:

a.    Bylaw 8(b): the strata must repair and maintain common property that has not been designated as limited common property (LCP).

b.    Bylaw 35(1): confirms that the residential and non-residential strat lots are separate sections.

c.    Bylaw 35(3)(a): the strata bylaws apply to each section in relation to matters not solely relating to each section and to property common to both sections, excepting LCP of each section.

17.   The strata bylaws do not include any formula for allocation of expenses between the two sections. The SPA and Strata Property Regulations (regulations) apply.

18.   Section 1 of the SPA defines common expenses as those related to the strata’s common property and common assets or that are required to meet any other purpose or obligation of the strata.

19.   Section 91 of the SPA states the strata is responsible for the strata’s common expenses. Section 92 defines “operating fund” and the “contingency reserve fund” (CRF) as follows:

a.    Operating fund: common expenses that usually occur either once a year or more often, or are necessary to obtain a section 94 depreciation report;

b.    CRF: common expenses that usually occur less often than once a year or that do not usually occur.

20.   Section 190 of the SPA says that the SPA applies to strata corporations with sections, subject to the regulations.

21.   Section 194 of the SPA says that the strata retains its powers and duties in matters of common interest to all of the owners. Where matters relate solely to a section, the section is a corporation and has the same powers and duties to set up its own operating fund and CRF for common expenses of that section. The commercial section does not have its own operating fund or CRF. The residential section has only recently created its own operating fund and CRF.

22.   Section 196 of the SPA requires each section to elect an executive which may call and hold meetings and pass resolutions affecting the section.

23.   The owner says that the main dispute is about the way certain operating expenses are allocated to the commercial section. The owner pays 10.39% of all common expenses relating to all 4 buildings. The owner’s 2017/2018 strata fees total $30,441.49. The owner says that the common expenses relating to buildings B, C and D should not be charged to it. This would reduce the owner’s contribution to the strata’s expenses by about 43.3%. The owner also says it should not have to contribute to the expenses relating to the Facilities Area ($15,600), elevators ($12,000), and emergency stairs (not a separate expense item), as well as for annual window cleaning ($6,302), all of which relate to Building A. The owner says this approach would reduce its annual strata fees by $16,077, a substantial amount.

24.   The issue of strata fees and their allocation between the residential and commercial units has been a live one since at least 2009. In August 2009, the strata obtained its first legal opinion. The most recent opinion is dated February 21, 2018. These opinions did not help to resolve the parties’ dispute. The parties have also had many discussions relating to the allocation of expenses over the years. They were unable to reach an agreement on an appropriate allocation.

25.   From 2006 to 2011, the parties say that the owner did not contribute to costs related to that part of the common property. The owner says this was because the owner derived no benefit from those expenses. The owner later had to pay the arrears of strata fees owing. In 2011, the strata started charging the owner for a share of the common property expenses based on the owner’s total unit entitlement.

26.   The expenses associated with the Facilities Area were originally designated as a residential expense. This cost area was moved to the strata’s budget in 2014 over the owner’s objections.

27.   The question is whether the changes made by the strata in 2011 and 2014 were, and are, significantly unfair to the owner.

28.   By 2014, the strata had moved to a sections format for its budget which the owners approved. The only separate expenses attributed to the residential section at that time were accounting and bank fees.

29.   The owner provided a spreadsheet showing payment of strata fees from August 25, 2014 to March 31, 2018 in the amount of $157,087.95. The strata does not dispute the amount paid by the owner. The owner says it has overpaid by $18,000 and wants the strata to reimburse it for that amount.

30.   The strata plan shows that the owner’s strata lots are located either entirely on the basement level of building A (strata lot 24) or on both the basement and first floor levels (strata lot 25). Other than a storage unit assigned to each strata lot, the commercial units do not have any LCP attached to them. Entry to the basement level is via an exterior stairway as well as by two interior sets of stairs and the elevators. Entry to the first floor level is via two entryways, one on the northwest side of the building and the other on the northeast side of the building. All of the entry points are designated as common property including the elevators and stairways. To access these entries, people entering building A must cross through the courtyard area or from the city sidewalk over another green space running along the side of the building.

31.   The strata now agrees that expenses relating to buildings B and D, and the northwest elevator in building A are expenses solely for the residential section. The owner says that building C expenses should also be solely for the residential section. The owner says that expenses in building A for the Facilities Area, both elevators and the ‘emergency’ stairs should be excluded as well as costs relating to the courtyard area (primarily landscaping costs) and annual window cleaning at building A.

32.   In a civil claim such as this, the applicant bears the burden of proof.

33.   The owner asks the tribunal for the following orders:

a.    That the strata reduce the owner’s annual strata fees by $3,000 going forward;

b.    That the strata reimburse the owner the amount of $18,000 in strata fees which the owner paid under protest;

c.    That the Facilities Area, elevators and emergency stairs be designated as LCP of the residential section; and

d.    That the strata reimburse the owner for disbursements of $10.00 and tribunal fees of $225.00.

ANALYSIS

Has the strata treated the owner significantly unfairly since 2011 by improperly allocating expenses to the owner that relate to and benefit only the residential section owners?

If so, what is the appropriate remedy?

34.   For this analysis, I have further broken the issue down into two sub-issues:

a.    Should the Facilities Area, elevators and emergency stairs in building A be designated as LCP?

b.    Should certain common expenses be reallocated solely to the residential section? If so, should the owner be reimbursed the amounts it is seeking?

Designating common property as LCP

35.   The owner asks the tribunal to make an order designating the Facilities Area, elevators and emergency stairs in building A as LCP for the residential section. In the owner’s submission, this designation would make the residential section clearly responsible for expenses relating to these items of strata property.

36.   Although not included in the requested remedy section of its claim, the owner also submits that the parkade costs should be allocated to the residential section and says that this too should be reflected in the strata plan to avoid further disputes. I understand this to mean that the owner is asking the tribunal to also order a change to the strata plan changing the parkade from common property to LCP in favour of the residential strata lots. The strata has responded to this submission and opposes it.

37.   Common property may be designated as LCP for the exclusive use of some strata lot owners. If not designated as LCP on the strata plan, the most common way to make this change is by a ¾ vote of the owners passed at a general meeting (section 74 SPA). The owners have not passed a ¾ vote to do so nor does it appear such a resolution has been formally proposed.

38.   Section 3.6 of the Act sets out the kinds of claims that come within the jurisdiction of this tribunal as well as those that are expressly excluded. Making an order designating common property as LCP is not specifically addressed in the Act. Such an order would involve making a significant change to the use of common property that might affect the benefits enjoyed by some strata lot owners. It would also make a significant change to the residential owners’ liability for costs of repair and maintenance to the LCP-designated areas. Even if it is within the jurisdiction of this tribunal to make that order (a question on which I make no finding), I find that it would be significantly unfair to the residential owners to do so without giving them the opportunity to vote on the change as set out in the SPA. I dismiss this part of the owner’s claim.

Unit entitlement formula

39.   In 2011, the strata started charging the owner for a share of the common property expenses based on the owner’s total unit entitlement. The owner says that this change in formula for charging expenses was not properly authorized by a unanimous vote of the owners. On this point, the owner is mistaken. Common expenses are normally charged on a unit entitlement basis and if a change is proposed to the unit entitlement formula, it is that change which requires a unanimous vote.

40.   Section 99(2) of the SPA requires all owners to contribute to the strata’s operating fund expenses and the CRF on the basis of unit entitlement. That formula can only be changed by unanimous vote at a general meeting (section 100 SPA). There is no evidence in this case that a unanimous vote was passed. Therefore section 99(2) applies. For the purpose of this decision, nothing turns on the fact that the strata incorrectly calculated strata fees in the past.

41.   Without a unanimous vote, under regulation 6.4, a strata cannot use a different formula unless the expense relates to and benefits only LCP or only one ‘type’ of strata lot. Although the strata has approached its sections as ‘types’ in its past budgets, it has done so incorrectly. A vote held to convert the sections into types was defeated. The strata must therefore continue to operate as a strata corporation with 2 separate sections, until such time as the bylaws are changed to eliminate the 2 sections.

42.   The owner’s evidence shows that the total unit entitlement of all strata lots is 7,346. The commercial lots have a total unit entitlement of 763 and the residential lots have a total unit entitlement of 6,583. The owner therefore has 10.4% (rounded) of the total unit entitlement of the strata including all 4 buildings. However, the strata agrees that all expenses associated with buildings B (5 units) and D (8 units) are residential expenses to which the owner need not contribute. These residential units together account for 1,910 of the total unit entitlement or 26% of the overall strata expenses. Building C has a total unit entitlement of 1,097 for 17.3% of the overall strata expenses. Building A has 23 residential units with a total unit entitlement of 3,403 (46.3% of overall strata expenses) plus the 2 commercial units.

43.   In the history of this strata, the owner was the owner developer of the complex. The owner says it did not have to pay any strata fees from 2006 to 2011 but I find that the owner did have an obligation to pay during those years. The parties agree that the owner did eventually pay the arrears of strata fees owing. I find that there is nothing in the evidence that would persuade me that the owner should not have to pay strata fees or contribute to common expenses.

44.   However, the owner says that by allocating certain expenses to the commercial section which benefit only the residential section the strata has treated the owner significantly unfairly.

Significant unfairness

45.   Under section 164 of the SPA, an owner can dispute a decision by the strata on grounds that the decision is “significantly unfair” to the owner. Section 48.1 of the Act mirrors the language in sections 164 and 165 of the SPA giving the tribunal the authority to consider significant unfairness claims and make a range of orders. (See The Owners, Strata Plan BCS 1721 v. Watson, 2018 BCSC 164, at paragraph 119 where the court confirms this authority of the tribunal).

46.    “Significant unfairness” is “unjust and inequitable conduct” and conduct that is “oppressive, unfairly prejudicial, wrongful, burdensome, harsh or done in bad faith.” (see Reid v. The Owners, Strata Plan LMS 2503, 2003 BCCA 126 at paras. 27-29)

47.   The owner says that the decision in Large, McCall et al v. The Owners, Strata Plan No. 601, 2005 BCSC 1128 is analogous to this case. There, the court found that it was significantly unfair for one section to pay strata fees for benefits or services that it could not use (at paragraph 60).

48.   The strata bylaws identify the 2 separate sections. The bylaws do not provide any specific provisions dealing with the allocation of expenses between the sections.

49.   The strata says it is not unfair to allocate common expenses on the basis of unit entitlement where no change to that approach has been authorized by a unanimous vote of the owners (see The Owners, Strata Plan LMS 1537 v. Alvarez 2003 BCSC 1085). The strata also refers to Yang v. The Owners, Strata Plan LMS 4084 2010 BCSC 453 to argue that common area expenses include electricity, natural gas, and landscaping services.

50.   The test used to answer whether the strata’s allocation of common expenses is significantly unfair to the owner has 2 parts: 1. does the evidence objectively support the owner’s reasonable expectation that the various expenses noted would be fairly allocated based on use and benefit, and 2. if so, was the owner’s reasonable expectation violated by an action that was significantly unfair? (see Dollan v. The Owners, Strata Plan BCS 1589, 2012 BCCA 44 at paragraph 30)

51.   The owner says that it does not derive any benefit from certain expenses to which it is required to contribute. It says that  these specifically include: the Facilities Area, elevators, window cleaning, 3 outdoor courtyard areas, charges associated with buildings B, C and D, and the emergency stairs in building A.

52.   The owner also says that, as a result of contributing to these residential expenses, it has overpaid $18,000 in strata fees. It says it should have its annual strata fees reduced by $3,000 going forward.

Expenses

Buildings B and D

53.   The strata now agrees that the owner should not contribute to expenses relating to buildings B and D. These are buildings for the sole use and benefit of the residential section. I therefore order the strata to stop charging these expenses to the owner.

54.   The owner also says it should be reimbursed for the overpayment of strata fees that it paid relating to the 2 buildings. Since the owner’s application was not filed until December 22, 2017, I consider only expenses charged for the strata’s fiscal years 2016 to 2018.

55.   The parties each provided their own breakdown of expenses relevant to these 2 buildings. Their calculations are quite different. The strata has calculated that total expenses for buildings B and D for fiscal years 2016 to 2018 amount to $35,555. 10.39% of that amount is $3,694.16. On the other hand, the owner’s calculation uses the unit entitlement allocation as the basis for calculating costs for these  two buildings (1910 out of the total 7346 or 26% of the total unit entitlement for the strata).  The owner’s calculation for fiscal years 2016-2018 shows that it overpaid $21,459.69 in strata fees in relation to buildings B and D.

56.   The strata’s financial statement for year end 2016 shows total expenses of $241,695.80 . For year end 2017, total expenses were $246,325.65. The parties did not provide a financial statement for year end 2018 with their additional submissions. The total expenses budgeted for the 2017/2018 fiscal year amount to $293,084.11.

57.   Although the evidence shows that the issue of expense allocation has been discussed since at least 2011, the parties have not been able to agree on a reasonable or fair method of allocation of expenses between the residential and commercial sections. It falls to this tribunal to craft a means for the parties to allocate certain expenses moving forward. Where there is less than perfect evidence to calculate an overpayment, it may require ‘rough justice’ to design a sensible and practical approach to this exercise. I find, however, that this approach meets the mandate and role of the tribunal as set out in section 2 of the Act.

58.   I have used the year-end financial statements for 2016 and 2017 and the 2018 budgeted expenses to calculate the overpayment for buildings B and D. The approach uses unit entitlement to determine the share of expenses attributable to buildings B and D and the commercial section’s contribution to those expenses (the overpayment). For 2016, the result of this calculation is an overpayment of $6,529.30 ($241,695.80/7346 = $32.90 per unit entitlement x 1910 = $62,842.22 expenses relating to buildings B and D x10.39% = $6,529.30 overpaid by the commercial section). For 2017, the calculation produces an amount of $6,654.38 and for 2018, $7,917.54. The total amount of the overpayment is $21,101.22 (rounded). I order the strata to reimburse the owner the amount of $21,101.22.

Facilities Area

59.   From the time the Facilities Area was completed (about 2009) until 2014, the strata did not charge any part of the expenses relating to the Facilities Area to the owner. I find that the owner had a reasonable expectation that the strata would not require the owner to contribute to these expenses in the owner’s strata fees.

60.   The Facilities Area includes a hot tub and a small gym with some exercise equipment. The owner’s submission indicates that the owner has little personal knowledge of what is actually contained in the Facilities Area. This area is marked as common property on the strata plan and is called the “Fitness Centre”. The strata says that the owner has never been prevented from using the Fitness Centre and that the residential owners rarely use the hot tub during the day so that the owner’s tenant, the spa operator, might well benefit from having an indoor hot tub to complement the outdoor private hot tub.

61.   I am satisfied on the evidence, however, that the owner makes no use of the Facilities Area and has not done so since completion of the building. I find that the change to allocating these expenses that was made in 2014 was an action by the strata that was significantly unfair to the owner.  For these reasons, I order the strata to stop charging the Facilities Area expenses to the owner.  The strata has provided a breakdown of expenses relating to the Facilities Area which total $43,782 for 2016 to 2018. 10.39% of this total is $4,548.95. The owner’s calculation for the same period is $4,274.81. I order the strata to reimburse the owner the amount of $4,274.81.

Elevators

62.   The strata charges the owner for its share of the expenses relating to the elevators. The 2017-2018 budget sets these expenses at $12,000.00. The strata has agreed that it should not charge a portion of the elevator expenses relating to the northwest elevator to the owner. I find that it is reasonable to conclude that the northwest elevator accounts for ½ of the total elevator expenses of the strata. I order the strata to stop charging ½ of the elevator expenses to the owner.

63.   The strata calculates the total costs related to this elevator for 2016 to 2018 at $20,360. 10.39% of that amount is $2,113.85. The owner’s calculation claims $1,632.62 for the same period. I order the strata to reimburse the owner the amount of $1,632.62.

64.   The expenses for the second elevator remain in dispute.

65.   The owner says that for years the commercial section did not use the other elevator, which it calls the south end elevator. The owner, its tenant, their customers and suppliers used only the front door entrance. Only after the strata’s refusal to re-allocate various expenses to the residential section did the commercial section begin using the south end elevator. Even this usage, the owner says, was infrequent.

66.   The strata says that the owner’s  tenant uses this elevator for deliveries including the movement of linens by their laundry contractor. It may also be used to access the upper part of the strata lot by customers with mobility issues.

67.   The anecdotal evidence suggests that the owner may receive a lesser benefit from the expense relating to the south elevator. However, I do not have evidence of an objective measurement of the owner’s or its tenant’s use of this elevator to show a much greater use by the residential owners (see Yang, v. The Owners, Strata Plan LMS 4084, 2010 BCSC 453 at paragraph 41).

68.   I am satisfied that the owner receives some benefit from its tenant having the use of the south elevator. I find that there is no significant unfairness in the owner contributing to the expenses relating to the south elevator. I dismiss the owner’s claim to be excluded from contributing to these expenses.

Window cleaning

69.   The owner says that the cost of window cleaning has no or little benefit for the commercial units. Strata lot 24 is entirely located on the basement level of building A and has no windows. Strata lot 25 has windows but, because it is a commercial unit and leased to a spa business, the windows have to be cleaned much more regularly. These cleaning costs are separate from common expenses as they are paid wholly by the owner.

70.   The strata says it hires a contractor every year to wash the outside of all windows as part of a building envelope maintenance item benefiting all owners. In response the owner says that the commercial units require more frequent cleaning. The owner would like to be responsible for its own window cleaning, at its own cost. Alternatively, the owner says it should be entitled to submit its own cleaning invoices to the strata for reimbursement as a common expense. In strata budgets from 2014, the expense for window cleaning has consistently been around $6,300. The owner did not provide evidence about the cost of cleaning the commercial strata lot windows or how frequently this is done.

71.   Based on the photographs which the owner has provided, most of the windows appear to belong to the residential owners in building A. The strata has agreed that buildings B and D should be excluded but I find that, for this expense item, building C should be excluded as well. The owner receives no or little benefit from cleaning of the windows at building C. I order that the strata stop allocating window cleaning costs relating to building C to the owner.

72.   Building A, which contains the commercial strata lots, is a different matter.

73.   I agree with the owner that there are different considerations when considering an expense that clearly benefits the residential strata lots but may not provide any similar benefit to the owner of the commercial strata lots. However, the window cleaning at building A, even if it only occurs once a year, as part of the overall maintenance of the building envelope, does benefit the owner. The owner occupies a portion of building A. I find that it is not significantly unfair for the owner to contribute to properly assessed common expenses such as annual window cleaning of building A.

74.   Strata Bylaw 8 makes the strata responsible to repair and maintain exterior windows which are common property. “Repair and maintain” includes cleaning (see Mackin v. The Owners, Strata Plan 1374, 1998 CanLII 3985 (BCSC)). Exterior window washing is generally a common expense. Although not binding on me, my conclusion is consistent with the tribunal’s decisions in Oakley v. The Owners, Strata Plan VIS 5481, 2017 BCCRT 17 and Mellor v. The Owners, Strata Plan VIS 2316, 2017 BCCRT 92.

75.   For these reasons, I order the owner to contribute to its share of the annual window cleaning expense for building A.

76.   The owner has a separate interest from the strata in having its own strata lot windows cleaned more frequently for business purposes. I dismiss the owner’s claim to have the strata pay for the expense of contracting additional window cleaning for the benefit of its tenant.

Parkade and Building C

77.   Building C sits atop a portion of the parkade. The parkade is used by all residents and visitors of the strata. The owner has no access to building C which is 100% residential.

78.   The strata plan shows the parkade is common property. The strata says that building C’s location makes building C and the parkade integral to each other and, in essence, inseparable. I disagree. The strata plan shows the parkade extending underground  well  beyond the exterior walls of building C. The plan shows that the residents of building C have no separate internal access to the parkade from their units. The owner can access the parkade from a door in the basement of building A. Otherwise, the evidence shows that, other than the main entry way into the parkade for vehicles, access is from 2 stairwells in the courtyard area.

79.   The strata says that the parkade is the foundation for building C and that therefore  the costs of repair and maintenance to building C must therefore be included in the  common expenses. If building C is excluded like buildings B and D, the strata speculates that the strata would not know how to handle the repair costs, if building C is damaged as a result of a structural issue in the parkade.

80.   The owner says that the parkade costs associated with buildings B, C and D should be paid by the residential section. However, the owner also admits that the fees associated with some of the parkade are appropriately payable by the commercial section. The owner does not say what portion of the parkade costs would be appropriate for it to pay.

81.   I find that the parkade is also used by the owner’s tenant and its customers. For this reason, I find that it is not significantly unfair for the owner to contribute to expenses relating to the parkade. The owner’s claim to have these costs paid solely by the residential owners is dismissed.

82.   There is no evidence that the strata has had any problems with structural or other major issues in the parkade. However, it is possible that such problems could arise in the future as the structure ages. There is no evidence that any such problems would directly affect building C itself. As a matter of common sense, repairs to the parkade will be a common expense. If there is expert evidence that damage to the parkade caused damage to building C, then the repairs to building C would be a common expense as well. Similarly, if the residential section fails to properly maintain building C and expert evidence shows that this failure resulted in damage to the parkade, then the residential strata lot owners would be responsible for the repair expenses.

83.   I find that, like buildings B and D, the owner should not be responsible for expenses relating to the repair and maintenance of building C not related to the parkade. I order the strata to stop charging the owner for expenses related to building C. The strata has provided a breakdown of certain specific building C expenses incurred for 2016 to 2018 (refinishing wooden doors, window cleaning, painting and insurance). The strata calculates a total expenditure of $18,645. 10.39% of that total is $1,937.22. On the other hand, the owner calculates the total amount of the overpayment of expenses relating to building C at $14,269.01. I am satisfied that a unit entitlement approach to the calculation is appropriate for building C expenses as well as for buildings B and D. Applying that approach to building C (which accounts for 1270 of the total unit entitlement), I calculate the total amount of overpayment by the owner for 2016 at $4,341.25 ($241,695.80/7346 = $32.90 per unit entitlement x 1270 x 10.39% = $4,341.25). For 2017 it is $4,424.38 and for 2018 $5,264.92.  The total amount is $14,030.55.

84.   I order the strata to reimburse the owner the amount of $14,030.55.

Courtyard areas

85.   The owner says that the courtyard areas were initially accessed by both customers of the spa and residents. Then the strata posted ‘private property: no trespassing’ signs to keep the public out. The owner says the residential owners wanted to stop the public from using the courtyard as a thoroughfare. The owner says that the spa operator and its guests then refrained from using the courtyard at all.

86.   The strata says that the courtyard areas are green spaces that are all connected and encircle all buildings. The strata adds that these green spaces serve the overall aesthetic of the strata and are maintained as one overall area. There is one landscaping budget item in the budget. This expense is set at $10,000 in the 2017-2018 strata budget.

87.   Although the owner says that only the residential section has access to the courtyard areas, there is no other evidence to suggest that access to those areas is physically controlled. The photographs of the courtyard area supplied by the owner do not indicate that the owner has no access to or no ability to make use of or enjoy the green space. There were no photographs of the space where the buildings face the street. I find that the owner has failed to prove that it receives no benefit from the landscaping costs.

88.   For these reasons, I dismiss the owner’s claim to be excluded from having to contribute to the landscaping costs.

Emergency stairs

89.   The owner says it should not have to contribute to the costs associated with the north stairwell. It accepts that fees associated with the south emergency access stairwell should be paid. The strata says that emergency stair access is not a separate expense item but that the spa operator and their clients have access to both stairwells. They would be expected to use either one in an emergency.

90.   I find that it would be impractical for the strata to have a separate budget expense item relating to these stairs.

91.   In any case, I also find that these stairs are common property and they serve an important purpose for everyone in building A, both residents and visitors. This is not an expense that should be separated out in the strata budget and contributed to separately by the residential and commercial sections. For these reasons, I dismiss the owner’s claim to be exempt from contributing to any repair or maintenance costs involving these stairs as part of the common expenses relating to building A.

Other matters

92.   In the owner’s reply to the strata’s submissions and documentary evidence relating to expenses, the owner has raised additional matters not included in the owner’s original claim. These additional matters are electricity and natural gas expenses, storage units and contribution to a special levy to repair the 3^rd balcony. The strata did not have an opportunity to give a response to these additional matters.

93.   Procedural fairness requires that a party have sufficient notice of the claims made against it and a fair opportunity to make a full response. That did not happen in this case. For these reasons, I will not decide the additional matters raised by the owner.

94.   I will, however, briefly comment on the matters of the storage units and the special levy. It is part of the tribunal’s jurisdiction under section 3.6 of the Act to assist the parties, where possible, in resolving disputes in recognition that they have an ongoing relationship.

95.   The owner says it has never been assigned a storage unit yet is being assessed fees for those units. This is not entirely correct. The strata plan plainly shows two storage lockers which are LCP for the exclusive use of strata lots 24 and 25. The owner should review the strata plan with the strata and claim those storage units for its use if they are now being used by another party.

96.   The special levy was assessed in order to replace the ‘third deck’ in building A.  The owner says because the third deck is LCP, not common property, it paid its share under protest. The owner says it wishes to have this amount ($10,814.05) reimbursed to it. Like the electricity and natural gas expenses, I find it would be procedurally unfair to the strata to decide this issue now. The owner may bring another application to the tribunal to decide this issue.

Limitation

97.   Where I have ordered the strata to reimburse the owner amounts for items which I have found are solely or primarily residential section expenses, the order is limited to reimbursement for the strata fiscal years 2015-2016, 2016-2017 and 2017 to 2018. This is because of the 2 year time limitation on claims preceding the filing of the owner’s application on December 22, 2017.

Tribunal fees and expenses

98.   Under section 49 of the Act, and the tribunal rules, the tribunal will generally order an unsuccessful party to reimburse a successful party for tribunal fees and reasonable dispute-related expenses. The owner has been substantially successful in its claims. I therefore order the strata to reimburse the owner for tribunal fees of $225.00 and dispute-related expenses of $10.00.

99.   The strata corporation must comply with the provisions in section 189.4 of the SPA, such as not charging dispute-related expenses against the owner, unless the tribunal orders otherwise.

DECISION AND ORDERS

100.      I order that:

a.    The strata will immediately stop charging all expenses relating to buildings B and D to the owner,

b.    Within 60 days of the date of this decision, the strata will reimburse the owner the amount of $21,101.22  for the portion of the owner’s strata fees relating to building B and D expenses for the fiscal years 2015-2016, 2016-2017 and 2017-2018,

c.    The strata will immediately stop charging expenses relating to building C to the owner, with the exception of the owner’s portion of expenses relating to the parkade, calculated on a unit entitlement basis,

d.    Within 60 days of the date of this decision, the strata will reimburse the owner the amount of  $14,030.55 for the portion of the owner’s strata fees relating to building C expenses, with the exception of expenses relating to the parkade, for the fiscal years 2015-2016, 2016-2017 and 2017-2018,

e.    The strata will immediately stop charging expenses relating to the Facilities Area to the owner,

f.      Within 60 days of the date of this decision, the strata will reimburse the owner the amount of $4,274.81  for the portion of the owner’s strata fees relating to the Facilities Area for the fiscal years 2015-2016, 2016-2017 and 2017-2018,

g.    The strata will immediately stop charging expenses relating to the northwest elevator in building A to the owner,

h.    Within 60 days of the date of this decision, the strata will reimburse the owner the amount of $1,632.62 for the portion of the owner’s strata fees relating to the northwest elevator in building A for the fiscal years 2015-2016, 2016-2017 and 2017-2018,

i.      The owner will contribute to elevator expenses relating to the south elevator on  a unit entitlement basis,

j.      The owner will pay for its share of the annual window cleaning expense for building A only, on a unit entitlement basis,

k.    The owner will contribute to expenses relating to the parkade on a unit entitlement basis,

l.      The owner will contribute to its share of the common property expenses relating to building A including the emergency stairs on a unit entitlement basis,

m.   Within 30 days of the date of this decision, the strata will make the necessary calculation and adjustments to its financial records for fiscal years 2015-2016, 2016-2017 and 2017-2018. The strata must then deliver to all of the strata lot owners copies of correctly adjusted financial statements showing the current balances for the strata’s  operating and contingency reserve funds,

n.    Within 30 days of the date of this decision, the strata must reimburse the owner $225.00 for tribunal fees and $10.00 for dispute-related costs.

101.      The owner’s remaining claims are dismissed.

102.      The applicant is entitled to pre-judgment interest on the total amount ordered (excluding tribunal fees and costs) of $41,039.20 under the Court Order Interest Act, R.S.B.C. 1996, c. 79, as amended, in the amount of $485.22. Interest was calculated using the British Columbia Court Interest Calculator from the date the application was filed to the date of the order on November 20, 2018.

103.      The applicant is also entitled to post judgment interest under the Court Order Interest Act R.S.B.C. 1996, c. 79, as amended.

104.      Under section 57 of the Act, a party can enforce this final tribunal decision by filing, in the Supreme Court of British Columbia, a validated copy of the order which is attached to this decision. The order can only be filed if, among other things, the time for an appeal under section 56.5(3) of the Act has expired and leave to appeal has not been sought or consented to. Once filed, a tribunal order has the same force and effect as an order of the Supreme Court of British Columbia.

105.      Orders for financial compensation or the return of personal property can also be enforced through the Provincial Court of British Columbia. However, the principal amount or the value of the personal property must be within the Provincial Court of British Columbia’s monetary limit for claims under the Small Claims Act (currently $35,000). Under section 58 of the Act, the Applicant can enforce this final decision by filing in the Provincial Court of British Columbia a validated copy of the order which is attached to this decision. The order can only be filed if, among other things, the time for an appeal under section 56.5(3) of the Act has expired and leave to appeal has not been sought or consented to. Once filed, a tribunal order has the same force and effect as an order of the Provincial Court of British Columbia.