Residents of a Thornhill condominium complex have learned there may not be anybody in charge of their building’s $4-million budget now that there is no board of directors that can legally conduct new business on behalf of condo owners.
CBC Toronto has learned the board of The Fountains condos on North Park Road lost quorum last week after four of its five members quietly resigned. Another board member, who was appointed as a replacement, lasted only a few days on the board before also quitting.
But as of Monday night, the condo owners themselves hadn’t been formally notified of the resignations and that quorum had been lost until CBC Toronto advised them of the unusual development
“People are just generally fearful. There’s a feeling of mistrust. Nobody knows what’s happening,” said resident Lior Hershkovitz.
It’s the latest in a series of cautionary condo-related tales that CBC Toronto has highlighted in recent months. Unlike people who own houses, condo owners rely on board members to make key decisions affecting their homes, even if they don’t live in the building itself. Ontario’s Condominium Act allows almost anyone over 18 to sit on a condo board, even if they have no financial stake in the building.
“The board has lost quorum,” Stan Morris, the president of the board, confirmed with CBC News. Land registry records show Morris, 74, isn’t a registered owner at The Fountains, although he says he co-owns a unit. He isn’t a registered tenant there, either.
Under the Condominium Act, the board has up to 30 days to notify owners if a board member quits or is replaced.
It’s not clear what day last week quorum was lost, but Morris confirmed it on Friday afternoon. The act says the board has five days to inform owners if quorum is lost.
“An Information Certificate Update will be forwarded to all owners in compliance with the Act,” Morris told CBC Toronto.
Morris, who has been the president of the board since 2014, is the sole known board member who seemingly remains on the board. It’s unclear if he plans on resigning the position, or retaining leadership of a new board, once elections are held.
Board faces multiple problems
And the board’s woes don’t end there.
Dozens of residents claimed the board lacked transparency. They also raised concerns over mounting expenses. They say the last straw came several weeks ago when the board hit them with another special assessment — the second in three years.
It was a demand for all condo owners to collectively pay $1 million to cover shortfalls in the complex’s reserve fund and operating budget.
CBC Toronto has also learned that two of the board members hadn’t completed the provincially mandated training required to sit on a condo board.
Owners say they’ve also seen their maintenance fees rise by about 27 per cent over the past three years.
“It’s too much,” owner Alex Benchedrid told CBC Toronto recently. He says he’s now paying about $1,650 each month in fees and assessments alone for his two-bedroom condo.
But Morris says the board has done nothing wrong, and the extra money is needed to pay for problems left behind by the developer when the complex opened almost five years ago.
Lawyer Audrey Loeb says The Fountains case illustrates how condo buyers can find themselves in the dark. Loeb had been working with The Fountains owners to replace the board when the resignations started.
“It is hard to really evaluate matters before you buy,” Loeb said.
“Most condominiums are fine. The ones that are off side are the exception.”
“Mr. Morris has no legal interest as an owner or resident of a unit in the condominium. It is, in my experience, unusual for someone who has no interest in a unit in the building to hang on so hard to a position on the board. Many condominiums do not allow non-owners or non-residents to even be on the board,” Loeb told CBC News.
President says he co-owns a condo in the complex he helps run
But Morris insists he does co-own a condo in the complex.
The condo is spending large sums of money “to address repairs to the parking garage and building envelope. These deficiencies are currently the subject matter of a lawsuit,” wrote Morris in a series of emails to CBC Toronto.
“I am a condo owner. The condo unit is registered in the name of my fiancée. My fiancée and I are co-owners. I have an equitable ownership interest in the property,” he wrote.
As the board resignations started piling up, remaining members appointed two new members in an effort to keep the board alive. But neither of the two new board members live in, or own condos, in the complex either.
CBC Toronto has learned one of them is a longtime friend of Morris. Both worked for a condominium services company where Morris is a regional manager.
Morris said his former colleague “was appointed to the board because of her over 30-year history of successfully managing condominiums.”
CBC Toronto reached out to the board member in question about the appointment. She did not respond.
Morris said, like some of the other board members, she resigned after receiving “malicious emails” from some owners.
Loeb, the lawyer, says the board could have notified everyone who owns condos in The Fountains to see if any of them were interested in joining the board, instead of the non-residents.
“Many boards will advise owners of resignations and ask if anyone is interested in being on the board. This is not a mandatory process but it is fair and open,” she said.
But Morris claims “interested owners are afraid to come on to the board.” Hershkovitz, one of The Fountains residents, says most owners remain in the dark about the resignations and who was appointed to run their complex.
“They can’t believe it. They want to know who resigned, what’s going on here. Nobody knows anything, The secrecy is just incredible,” said Hershkovitz.