Orangeville: (519) 940 - 8309
Fergus: (519) 772-6139
Fax: (519) 940 - 0526

Condo Lawyer in Ontario

A resale condominium purchase turns on the status certificate: the condominium corporation's disclosure package for both the unit and the building. The corporation has ten days to deliver it after receiving a request, and the buyer's lawyer must complete the review within the condition period set out in the agreement of purchase and sale. A short condition period can leave little or no time to identify a problem before the deal becomes firm.

Foote Law acts for buyers and sellers of condominium units from its offices in Orangeville and Fergus, and for clients throughout Ontario.

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How Foote Law Can Help

Foote Law handles condominium purchases and sales from the first review of the status certificate through to registration on closing. Its services include:

  • Requesting and reviewing the status certificate within the condition period.
  • Reviewing the declaration, by-laws, and rules, including unit boundaries and exclusive use common elements.
  • Confirming any arrears, liens, or special assessments affecting the unit.
  • Conducting title and off-title searches, and delivering written requisitions where a defect is found.
  • Coordinating with the lender and preparing the mortgage documents.
  • Preparing the statement of adjustments.
  • Registering the transfer and the mortgage electronically.
  • On a sale, paying out arrears and discharging liens and mortgages from the proceeds.

Foote Law accepts Legal Aid Ontario certificates and Employee Assistance Program referrals. Call Foote Law in Orangeville at 519-940-8309 or in Fergus at 519-772-6139. Foote Law serves clients in Orangeville, Fergus, Brampton, Shelburne, Alliston, Barrie, Owen Sound, Newmarket, Guelph, Centre Wellington, and throughout the Greater Toronto Area, in person and virtually.

The Status Certificate

Section 76 of the Condominium Act, 1998 requires a condominium corporation to provide a status certificate to anyone who requests one and pays the fee. The corporation must deliver it within ten days, and the fee is capped at $100, including all applicable taxes.

The certificate is a detailed snapshot of the corporation's affairs. It includes the declaration, by-laws, and rules; the current budget and most recent audited financial statements; the reserve fund balance and the status of the most recent reserve fund study; the insurance certificates; any management contract; any litigation involving the corporation; and a statement of the common expenses owing on the unit, including any arrears.

The certificate also carries legal weight. Under subsection 76(6), the corporation is bound by the information in the certificate as against a buyer or lender who relies on it. Ontario courts have applied this rule to relieve a buyer of a special assessment that the certificate did not properly disclose.

Timing is where many problems arise. The corporation's ten days run inside the condition period in the agreement. If the condition gives the buyer ten days or fewer, the corporation can deliver the certificate on the last day it is permitted and leave no time for a lawyer to review it.

What the Unit Actually Includes

The declaration defines what the unit consists of, and a schedule to the declaration sets out the unit boundaries. Everything outside those boundaries is a common element. The boundary matters because it generally determines who is responsible for maintaining and repairing a given component: the owner or the corporation.

Parking spaces and lockers can be held in one of three ways, and a listing that says "parking included" does not reveal which one applies:

01

Owned Unit

The parking space or locker is a separately titled unit. It transfers with the main unit on closing and, depending on the declaration, may be sold to another owner in the building.

02

Exclusive Use Common Element

The space is owned by the corporation as part of the common elements but reserved for the use of a particular unit. It cannot be sold separately from the unit, and it cannot be altered without the corporation's permission.

03

Assigned Space

The corporation allocates the space by licence or rule rather than through the declaration. This arrangement is less common, and the right to use the space may be revocable.

The structure can affect both the value of the unit and what the owner may do with the space. Balconies, terraces, patios, and townhouse yards are also commonly exclusive use common elements rather than part of the unit itself. Which arrangement applies is determined by the declaration and the registered title, not by the listing.

Arrears, Liens &
Special Assessments

Arrears and Liens on the Unit

When an owner falls behind on common expenses, section 85 of the Condominium Act, 1998 gives the corporation a lien against the unit. The lien covers the unpaid amount, interest, and the reasonable legal costs and expenses of collecting it. It arises automatically, but it expires three months after the default unless the corporation registers a certificate of lien within that time.

Under section 86, a registered lien generally takes priority over a mortgage on the unit, even one registered before the lien arose. For this reason, arrears disclosed on a status certificate are paid out of the sale proceeds before closing, and a lender will often pay them itself rather than lose its priority position.

Special Assessments

A special assessment is a one-time charge levied against owners to cover an expense that the budget and the reserve fund cannot. Each owner's share is calculated in the same proportion as the regular common expenses.

The status certificate discloses any special assessment that has already been levied, along with circumstances known to the board that may lead to an increase in common expenses or a special assessment. It cannot predict an assessment that the corporation has not yet identified.

As a general rule, a buyer who takes title before an assessment is levied will bear it, even where the problem behind it existed for years. The exception is an assessment arising from circumstances the corporation knew about but failed to disclose in the status certificate. Responsibility for an assessment levied before closing is determined by the agreement of purchase and sale, which is why the wording of that agreement deserves careful review before it is signed.

Closing the Transaction
& Buying Pre-Construction

Closing the Transaction

  • On a purchase, the buyer's lawyer searches title, confirms the unit's standing with the corporation, registers the transfer and the mortgage, and prepares the statement of adjustments. For a condominium, the adjustments include the current month's common expenses, which the seller has usually paid in advance and is credited for on closing, along with property taxes.
  • On a sale, the seller's lawyer orders the status certificate, obtains the lender's payout statement, and arranges the discharge of the mortgage. Any arrears or registered lien must be paid from the proceeds before the transaction can complete.

Buying Pre-Construction

  • A pre-construction condominium purchase operates under a different set of rules. Section 73 of the Condominium Act, 1998 gives the buyer a ten-day period to rescind the agreement after receiving the disclosure statement. Deposits are protected through the Tarion new home warranty program, and buyers typically occupy the unit for an interim period before title transfers on registration of the condominium.
  • New condominium purchases also carry an adjustment that resale purchases generally do not. The buyer is usually charged a contribution to the new corporation's reserve fund or working capital, commonly equal to two months of common expenses, on closing.
  • Foote Law's page on new and pre-construction home purchases sets out these rules in more detail.

Buying or Selling a Condo
in Ontario?

A condominium transaction depends on what the status certificate discloses, what the declaration says the unit includes, and whether arrears and assessments are dealt with before closing rather than after. Early legal advice, ideally before the agreement of purchase and sale is signed, gives a buyer or seller the most room to address a problem.

519-940-8309 Orangeville 519-772-6139 Fergus
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