Date Issued: June 26, 2019
File: ST-2018-005227
Type: Strata
Indexed as: Starr v. The Owners, Strata Plan EPS 59, 2019 BCCRT 778
Between:
Applicant
And:
The Owners, Strata Plan EPS 59
Respondent
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REASONS FOR DECISION |
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Tribunal Member: |
J. Garth Cambrey, Vice Chair |
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INTRODUCTION
1. The applicant, Douglas Starr (owner), owns a strata lot in the respondent strata corporation, The Owners, Strata Plan EPS 59 (strata).
2. The owner claims the strata council is making decisions via email and not recording its decisions in strata council meeting minutes, which he says is contrary to the Strata Property Act (SPA).
3. The owner requests a declaration that the strata council’s adopted procedure of advancing and passing motions via email is contrary to the SPA and strata bylaws unless such a bylaw is passed at a general meeting.
4. Alternatively, the owner requests a declaration that 2 motions passed by the strata council in May 2018 contravene the SPA and bylaws and orders that the strata council record the motions in the next strata council meeting minutes.
5. In either case, the owner also requests an order that the tribunal’s declaration be published in the next strata council meeting minutes.
6. The strata requests that I dismiss the owner’s claims.
7. The owner is self-represented, and the strata is represented by a strata council member.
8. For the reasons that follow, I allow the owner’s claims in part.
JURISDICTION AND PROCEDURE
9. These are the formal written reasons of the Civil Resolution Tribunal (tribunal). The tribunal has jurisdiction over strata property claims brought under section 121 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.
10. 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.
11. 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.
12. Under section 123 of the Act and the tribunal rules, in resolving this dispute the tribunal may order a party to do or stop doing something, pay money or make an order that includes any terms or conditions the tribunal considers appropriate.
ISSUES
13. The issues in this dispute are;
a. Does the strata council have authority to pass motions via email?
b. If so, must the council decisions be recorded in its minutes?
c. What, if any remedies are appropriate?
BACKGROUND, EVIDENCE AND ANALYSIS
14. I have read all the submissions and evidence provided but refer only to information I find relevant to provide context for my decision.
15. In a civil proceeding such as this, the applicant must prove his claims on a balance of probabilities.
16. The strata is a bare land strata corporation located in Penticton, B.C. It was created in January 2009 and consists of 61 residential strata lots.
17. The strata filed a complete new set of bylaws at the Land Title Office on April 8, 2009 that apply to this dispute. The Standard Bylaws do not apply.
18. The owner has identified 3 specific instances where he alleges the strata council passed motions via email, 2 of which he says were not discussed in subsequent meetings nor recorded in minutes.
19. The motions can be summarized as follows:
a. January 4, 2018 – approval of an expense up to $1,000 for snow removal.
b. May 30, 2018 – approval of resolutions prepared by legal counsel to be proposed at an upcoming special general meeting (SGM).
c. May 31, 2018 – approval of a $150.00 expense for a second microphone at the upcoming SGM.
20. The strata’s position is, in essence, that the strata council can pass motions via email especially in matters of emergency, and that the strata had previously approved this process.
21. The applicant says there is no evidence the strata council previously approved email motions and that it is contrary to the SPA and bylaws as it is not expressly permitted under the SPA or set out in the bylaws. He also says the process deprives owners of their right to observe council meetings.
22. As to the specific motions noted above, the strata says the January 4, 2018 snow removal expense was within budget and did not require a motion. It also says the motion was an emergency (which the applicant disputes), and in any event, the motion was ratified at a January 17, 2018 council meeting. The January 17, 2018 strata council minutes confirm the motion was ratified.
23. As for the May 30 and 31, 2018 motions, it is undisputed that the motions were not passed at, or recoded in minutes of, subsequent council meetings up to the completion of the tribunal dispute process for this dispute.
24. The owner requested a hearing to discuss the council’s use of “electronic motions” and was granted one on July 2, 2018. The accuracy of the July 2, 2018 minutes are contested by the applicant, but it is clear that the May 2018 motions were not ratified at that meeting and, in fact, the May 20, 2018 motion to approve resolutions drafted by legal counsel was not mentioned in the minutes.
Does the strata council have authority to pass motions via email and, if so, must the council decisions be recorded in its minutes?
25. The strata’s bylaw 24 requires council decisions to be made by a majority of council members present in person at a council meeting and the results of all votes to be recorded in the council minutes.
26. The courts have addressed a strata council’s authority under the SPA to conduct business outside a strata council meeting, including what details must be included in council minutes.
27. In Kayne v. The Owners, Strata Plan LMS 2374, 2007 BCSC 1610, the BC Supreme Court considered an application from an owner regarding the production of documents under sections 35 and 36 of the SPA. When considering those sections of the SPA, the court considered arguments about council meetings where no minutes were kept. I find the statements made in Kayne, particularly in paragraphs 8 and 23, provide helpful guidance on the issues in this dispute:
The purpose of the [SPA] is to ensure that members of the strata corporation are informed of the decisions taken and the money spent on their behalf. It mandates no particular form in which these documents are to be kept and no particular level of detail. For example, although it requires minutes, it does not, beyond stating that the minutes include the results of any votes, set out any degree of detail that must be contained in those minutes. Minutes must contain records of decisions taken by council, but may or may not report in detail the discussions leading to those decisions.
(at paragraph 8)
In any organization, there will be occasions when people who are members of a council or an executive will meet informally to discuss matters of relevance to the organization. Those are not meetings of the council and it would be unrealistic to expect minutes be kept of such meetings. Of course no decision that may be taken at any such meeting has any validity unless and until it is taken or ratified by a properly constituted and minuted meeting of the council. [my emphasis]
(at paragraph 23)
28. Based on Kayne, I find the email votes were not meetings of the council and the decisions taken are not valid until they are taken or ratified in a properly constituted and minuted council meeting.
29. In Yang v. Re/Max Commercial Realty Associates (482248 BC Ltd.), 2016 BCSC 2147, the Supreme Court agreed with the statements made in Kayne as noted above. The court then addressed an owner’s concern about strata council decisions made between regular council meetings, particularly by email, that were not included in the minutes, stating at paragraph 134:
With respect to meetings held by email the Strata Property Act does not specifically prevent such meetings although minutes must be provided for them. That said this Court has upheld decisions taken at email meetings that have not been noted in the minutes: Azura Management (Kelowna) Corp. v. The Owners, Strata Plan KAS 2428, 2009 BCSC 506 at paras. 31-32. However, the Court stated at para. 34 that it could not “conclude that the failure to produce minutes was significantly unfair to Azura or to any other Owner. I conclude that this failure only establishes an isolated instance of easily rectifiable procedural irregularity. In the future, the Council should produce minutes forthwith after all annual general meetings, special general meetings, and Council meetings are held.” [Emphasis in original.]
30. Although the court in Yang, citing Azura, upheld council decisions taken at email meetings, it did so with respect to an isolated instance. In Yang, the court also considered an unminuted council decision to include certain items in an SGM notice as being an isolated instance.
31. Unlike Azura and Yang, the question before me is not about an ”isolated instance of easily rectifiable procedural regularity”. Rather the question before me is whether the strata council has authority to pass motions via email on a regular basis.
32. While bylaw 23.1 permits council to arrange its meetings as it thinks fit, and bylaw 23.2 allows for council member attendance at meetings by electronic means, I find these bylaws are governed by the decisions in Kayne and Yang.
33. That is, I find the strata council has authority to conduct votes by email. However, as noted, I also find that decisions made by email votes are not valid unless the vote is ratified at a properly constituted and minuted meeting.
34. I also agree with the owner that that the strata has bylaws to address more urgent situations such as waiving its required 1 month notice for council meetings and meeting on less than 1 week’s notice to deal with emergency situations. It also has the ability to delegate its authority to others, including one or more council members, under bylaw 26.
35. As for the owner’s argument that an email voting process deprives owners and their spouses of their right to observe council meetings under bylaw 23.4, I agree. In particular, I suggest that continual email voting may, in certain circumstances, be subject to an owner’s challenge as a significant unfair act and I would discourage the strata from conducting it business by email votes unless it cannot vote otherwise. For that reason, I find that if a decision is made by email, the strata council should produce minutes documenting the decision as quickly as possible in order to validate the decision and vote.
What, if any, remedies are appropriate?
36. I decline to make the declarations sought by the owner as I do not find the strata has contravened the SPA or its bylaws. If the strata has not already ratified its email votes of May 30 and May 31, 2018 and recorded the votes in subsequent council minutes, I order that take a ratification vote at the next council meeting and record the outcome of the votes in the minutes of the meeting.
37. I also order the strata to report the tribunal’s decision in summary fashion at its next council meeting and record the tribunal’s decision and order in the meeting minutes.
TRIBUNAL FEES AND EXPENSES
38. 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. Here, I find the parties were equally successful and I order the strata to reimburse the owner for one-half of his tribunal fees or $112.50. Neither party claimed dispute-related expenses, so I make no order in that regard.
39. 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.
DECISION AND ORDER
a. Ensure its council take a ratification vote of its May 30 and May 31, 2018 email votes and record the outcome of those votes in the next council minutes, if it has not already done so,
b. Report the tribunal’s decision in this dispute in summary fashion at its next council meeting and record the tribunal’s decision and order in its minutes, and
c. Within 15 days of the date of this dispute, pay the owner $112.50 for tribunal fees.
41. 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 123.1 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.
42. 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 123.1 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.
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J. Garth Cambrey, Vice Chair |