Cost Ramifications for Difficult Condominium Owner

In a recent post, we blogged about an owner who had engaged in inappropriate behaviour to such an extent that it constituted a breach of sections 117 and 119 of the Condominium Act. The court made a number of compliance orders against the owner, but refused to make an order requiring the unit owner to sell his unit, as requested by the condominium corporation.

The cost decision on that case was recently released. The condominium corporation had incurred a total of $37,380 in legal fees, plus $12,060 in disbursements with respect to its court application.

The condominium corporation was seeking costs on a substantial indemnity basis and argued that it would be unjust for its legal costs related to the application to be borne by the other unit owners. The judge commented that the application was vigorously opposed by the owner. The unit owner had denied almost all the facts alleged, which required more work on the part of the applicant condominium corporation to substantiate its claims. The court decided that the unit owner was responsible to pay the entire amount of the corporation’s legal fees and disbursements and that such amount was to be added to common expenses against the owner’s unit and repaid over a four-year period by way of equal monthly instalments.

This owner not only had to pay the condominium corporation’s legal fees, but he also had to pay the fees of his own lawyer, who represented him in the application.

It was fortunate for the condominium corporation that the judge awarded a full indemnification of all of the costs incurred by the condominium corporation. In many cases, a successful condominium corporation is only able to recoup a portion of its legal costs. For the unit owner, this turned out to be a very expensive undertaking.

This case illustrates that it is generally in both parties’ best interests if disputes can be settled without resort to litigation, as:

• the results are never guaranteed;
• if you win, there is no guarantee that the winning side will be fully recompensed for its legal costs;
• if you lose, this can be a very expensive venture, as the loser will usually have to pay some or all of the costs of the winning side, as well as the legal fees for his or her own lawyer;
• litigation is time-consuming.