Condominiums Must Issue Correct Status Certificates

Carson Law — Condominium status certificate review

While this may seem obvious, what happens if the Same Condominium had previously issue two incorrect Status Certificates?

The Ontario Court of Appeal looked at the case of DBDC Spadina Ltd. v. Walton, 2018 ONCA 232.

Dante Reino, purchased the condominium unit from his mother in 2013. He was issued a “clean” status certificate. Reino wanted to sell his unit in 2016, and  requested a status certificate. This certificate indicated he had breached the condominium corporation’s declarations by altering the unit. Reino’s mother received a “clean” certificate when she purchased in 2004.

Apparently, neither Reino nor his mother had carried out any alterations to the unit as described in the 2016 certificate. Even though representatives of the condominium corporation had been in the unit numerous times over the course of  Reino’s occupancy – no one ever mentioned that the layout had been improperly altered.

The application judge concluded that s. 76 of the Condominium Act, 1998 was clear and unequivocal and that the condominium corporation was bound to its clean and clear status certificates from 2004 and 2013, and that it could not rely on the alleged breach in its 2016 status certificate. Furthermore, the condominium corporation was estopped from relying on its 2016 status certificate.

Court concluded:

  • The condominium corporation is bound vis-à-vis  Reino by the clean certificate it provided to him when he acquired the unit from his mother in 2013.
  • Reino has a remedy if the condominium corporation negligently issued the clean status certificate to him, to his detriment.
  • Reino can sue the condominium corporation for any diminution in the value of his unit by reason of any improper disclosure that may have occurred – provided he does so before the limitation expires.
  • Reino is entitled to rely on the Certificate issued to him in 2013 and the condominium corporation is bound by it.

Law Related to the Issuance of Status Certificates

  • it does not follow that the condominium is estopped from issuing anything but a “clean certificate” where it has previously provided a clean certificate.
  • If a condominium becomes aware, (after issuing a clean certificate) of a circumstance that is required to be disclosed by virtue of s. 76 or the regulations, it must include such information when it next issues a certificate.
  • This does not change the fact that it will still be bound by its earlier certificate vis-à-vis the purchaser at the time or his mortgagee.
  • Where the condominium discovered that the unit layout had been switched between its 2013 certificate and its 2016 certificate, it was obliged to include that information in the new certificate. To do otherwise would be misleading to the new prospective purchaser.

So, it’s quite clear. If the Condominium makes an error, it cannot cover it up. It must confess going forward and issue a correct up to date Certificate.

Brian Madigan LL.B., Broker

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