Dissatisfied With Your Board of Directors or Property Management Company ? What Are Your Options ?

Well, if you are dissatisfied with your board of directors or the property management company that is supposed to manage your condo here in Condo Land and you want to make changes, you had better understand the complex and lengthy process that is required and evaluate your odds of success before setting out on the arguous journey.

You will want to fully understand what it is that you are getting into before taking on what amounts to a mammoth task!

With condo life come rules, rules that you signed onto when you bought the condo unit, either in the Disclosure Documents that formed a part of the Agreement of Purchase and Sale that you signed receipt of when buying pre-sale, or in the Status Certificate in the case of being re-sale.

Either way, you signed an Acceptance of all the rules set out and any that the board has enacted since forming.

If you don’t like living with rules, the condo life may not be for you as there are no exceptions and minimal compassion . . . . . “rules are rules and they must be obeyed“.

Don’t get me wrong, rules are actually a good thing. They are designed to protect the best interests of the majority of the owners.

But in Condo Land, owner-residents in most condo buildings are the decided majority and very few of these owners actually pay attention to the actions of the board of directors.

And the majority of owners are investors (because of the way condos are sold in Condo Land) and virtually none of these people (many are overseas) pay attention to the goings-on of the board at all.

Most condo corporations here in Condo Land can’t even has a “quorum” sufficient to hold the Annual General Meeting (“AGM“)!

So, the first thing that you have got to do is identify and understand why you are dissatisfied with your board of directors and clearly define your “motives“.

Did you end up buying in a building with a one dog pet policy and you have two dogs?

Things like maintenance fee increases, special assessments, and the like, are not sufficient grounds to try to recall a board of directors over.

If the building is looking run down or unkept, if it’s dirty or has leaks that are not being fixed or the budgets are out of whack with unjust expenses, family members being on contract or a host of other common issues that pervade Condo Land, you may have grounds to consider replacing a board or certain board members.

If the reserve fund is under-funded and your condo corporation is running annual deficits, your condo board (and property manager) needs to be replaced.

That’s easier said than done!

I hate to be the bearer of bad tidings, but I can tell you right up front, that the odds of replacing your board of directors or property manager are stacked against you (like everything else involved with Condo Land).

Don’t get me wrong, it can be done.

I actually have managed it on a few occasions now.

The documents set out the percentage of votes needed to achieve a change in boards or property managers and the threshold for success of such endeavours is very, very high (sometimes needing 70% – 80% of owners to sign on).

Have you ever tried to get 70% of people to agree on anything?  And in Condo Land simply locating the owners is next to impossible due to the disproportion numbers of international investor buyers!

The first commitment you must make is your personal time.

You will need to spend countless hours learning all you can about the condo corporation, the board members, the property management company, the Condominium Act, Roberts Rules of Procedure, and learn how to access all your corporation documents and financial records.

The next major investment in personal time rests with finding the education you need to possess to achieve such a lofty challenge. There are web sites and books out there but you’ve got to find them and then study them all.

Then you’ve got to invest the time to talk with owners, especially realizing the mammoth voting requirements to prevail in a board overthrow.

You also must learn the practices and procedures, and as this is a legal challenge you’ve got to come up with the cash to take your fight to court.

Lawyers don’t come cheap and you will absolutely need to hire one or your odds of success are astronomical!

And here’s a rather shocking reality underscoring all of this: “the Ontario government will not get involved even if the boards are violating the Condominium Act“.

You have only four (4) options when it comes to replacing a board or board members:

1. You can Requisition a ‘Special Meeting‘. You need only 15% of registered owners (in good standing) to requisition a “Special Meeting” but you will need 50% + 1 to remove a board member or complete board.

2. You can wait until the next Annual General Meeting (“AGM“) and elect a new board of directors. Unfortunately not many owners want to sit on a board and/or volunteer their time and energy thus this also is very challenging (as long a a quorum of 25% of owners attend, either in person or by proxy, the candidates with the most votes form the new board).

3. You can apply for relief of the courts. This is the most effective approach but it is also the most expensive.

4. Some say you can wear them out by constantly and consistently challenging them. There usually are kick-backs and other motivating factors for corrupt board members to resist being removed and as long as they are getting “their palms greased” they will not comply with this strategy.

With the decided majority of owners being investors and so many of these investors being international non-residents, it is a sizeable challenge to take on fixing a broken condo and Condo Land is plagued with many, many dysfunctional and/or corrupt boards.

It is not something that can be taken lightly and the odds are decided against you, but it is something that can be achieved.

It’s just another blemish on the acned face of Condo Land.

I’m Charles

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