When a board or management receives a records request from an owner, the first step is to determine whether the documents requested are records that the owner is entitled to receive. In some cases, it may not be clear, and legal counsel may need to advise the corporation so that response to the owner is provided within the required timeframe.
Owners sometimes may request “draft” copies of documents such as financial statements, rules, or policies that have not been finalized by the board, or draft minutes that have not be approved by the board.
But the question is, are “draft” documents records of a condo corporation which owners are entitled to receive copies of?
There have been several decisions rendered before the Condominium Authority Tribunal (the “CAT”) which held that most “draft” documents are not records of condominium corporation.
Draft Meeting Minutes
The CAT has consistently held that draft meeting minutes are not records of a condo corporation. For instance, in Luclucan v. Peel Condominium Corporation No. 631, the CAT found that board meeting minutes that were not reviewed or approved were drafts and as such were not records of the corporation. The CAT declined to comment on the adequacy issue of the meeting minutes as they were drafts.
Similarly, in King v. York Region Condominium Corporation No. 692, the CAT found that a minute taker’s notes from annual general meetings were work products and as such were considered drafts and not records of the corporation.
Draft Financial Statements
In Emerald PG Holdings Ltd. v. Toronto Standard Condominium Corporation No. 2519, the CAT found that the draft audited financial statements were not a record of the corporation and that it was a work product of the external auditor as part of the process to produce the audited financial report.
On the other hand, in Harder v. Metropolitan Toronto Condominium Corporation No. 905, the CAT found that draft monthly financial documents that are produced for the purposes of review by the board of directors and relied upon in its ongoing governance duties were records of the corporation but were not core-records. The CAT further distinguished work products, information, and interim financial statements noting that the latter is part of the accounting records of the corporation that are needed for the reference of the board, its treasurer, and other individuals for auditing purposes.
Draft Policies or Rules
In Russell v. York Condominium Corporation No. 50, the CAT found that a draft privacy policy which had yet to be approved or adopted by the corporation was not a record of the corporation. The CAT commented that it was not simply a question of timing. The draft privacy policy in this case may never be adopted by the corporation or it may be significantly amended. The CAT also noted that simply explaining that the draft privacy policy was not a record was a sufficient explanation for not providing it.
Draft Reserve Fund Studies
In Sakala v. York Condominium Corporation No. 344, the CAT provided clear guidance on draft documents, noting “a draft document is, by definition, a work in progress. Even if the draft in question is highly similar or identical to the final form of the document, the draft itself remains unapproved, unfinished, and unauthoritative preliminary version of the document. With respect to an opinion or report in particular, it cannot be relied upon for certainly or to bind the provider of it since it remains open for correction or change”. The CAT noted that a draft document does not serve to: (1) assist the corporation in fulfillment of its duties and obligations; and (2) provide insight or information for unit owners who wish to confirm that such duties or obligations have been duly fulfilled. In Sakala, the CAT found that draft reserve fund studies were not records of the corporation.
Based on these decisions, it appears that in most instances, draft documents do not form part of the records of a corporation that an owner would be entitled to and that responding to this type of request from an owner, can simply be done by stating that a draft document is not a record of the corporation.
