The owners of the strata lots in a strata plan are the members of the strata corporation. Although the powers and duties of the strata corporation are, for the most part, performed by the strata council, or by the corporation’s agents or employees, the owners have an essential role in the operation of the strata corporation.
Definition of an “Owner”
The Strata Property Act defines the term owner to mean a person who is the registered owner of the fee simple interest in a strata lot in a Land Title Office or, in the case of a lease-hold strata plan, a person who is registered as the leasehold tenant of the strata lot. 1 In the case of a person who purchases a strata lot under an agreement for sale, the owner is the registered holder of the last registered agreement for sale. In the case of a registered life estate, an owner is the tenant for life. 2 In this book, the word owner is always used according to its meaning in the Act, unless otherwise stated.
The definition of an owner under the Act may restrict the rights of a person who has a significant financial interest in a strata lot, but who does not meet the criteria of an owner. Suppose, for instance, that a husband and wife together purchase a freehold strata lot, but only the wife registers her interest on title in a Land Title Office. 3 The common law regards the wife as a legal owner and the husband as a beneficial owner. Under the Strata Property Act, however, the wife is the only one who meets the definition of an owner because she is the one registered on title. It follows, for example, that the wife is an eligible voter, but the husband is not. 4
In Strata Plan NW 499 v. Louis Estate, an individual owned a half interest in a strata lot in the strata plan, apparently as a tenant in common, but never registered his interest in the Land Title Office. 5 The British Columbia Court of Appeal found that although the individual was, in law, an unregistered legal owner, he was not an owner under the Strata Property Act.
Within fifteen days of becoming an owner, the Standard Bylaws require the owner to inform the strata corporation of the owner’s name, strata lot number, and mailing address outside the strata plan, if any. 6
Ultimately, the owners direct a strata corporation’s activities by voting at general meetings. The Strata Property Act uses the term eligible voters to describe the persons who may vote at a general meeting. 7 The term eligible voters includes owners, as well as those other persons who, depending on the circumstances, may exercise an owner’s vote, such as a tenant, 8 or a mortgagee. A person who is entitled to vote can appoint a proxy. In addition, if certain criteria are met, a parent, guardian or legal representative can exercise the vote of a person who may vote. Depending on the circumstances, the court may also appoint someone to exercise a vote. For more information about voting, see Chapter 14, Voting.
In the end, the owners, and not the strata council, control the strata corporation. At each AGM, eligible voters must elect a strata council and approve the budget. Additionally, there are a number of other decisions that must be made by the eligible voters at their general meetings.
In some cases, the decision is made by a simple majority vote. In other cases, the decision must be made by a 3/4 or unanimous vote. In some situations, a strata corporation’s bylaws may require some other voting threshold for particular matters. The type of vote required for each decision may vary depending on the specifications in the Act, the regulations, or in some cases the Schedule of Standard Bylaws. Appendix B contains voting tables that organize matters requiring a vote at a general meeting by voting threshold (e.g., majority vote, 3/4 vote or unanimous vote) as well as by subject matter.
Directing the Strata Council
Section 27 of the Strata Property Act permits eligible voters, by a majority vote, to direct or restrict the strata council in exercising its powers and performing its duties. There are, however, some limitations of the eligible voters’ powers to direct or restrict the strata council.
Eligible voters may not direct or restrict the council if their instructions contravene the Strata Property Act, the regulations or the bylaws. For example, if the eligible voters pass a majority vote at a general meeting directing the strata council to close the strata corporation’s contingency reserve fund, the owners’ instructions are not enforceable because the Act requires every strata corporation to have such a fund. 9 In addition, the eligible voters cannot interfere with the strata council’s discretion to decide if someone has contravened a bylaw or rule, whether a person should be fined, whether to deny an individual access to a recreational facility, or whether to require a person to pay the reasonable costs of remedying a contravention of the bylaws or rules. Similarly, the eligible voters cannot interfere with the strata council’s discretion to decide whether to grant an owner an exemption from a rental restriction bylaw on the grounds that the bylaw causes that owner hardship. 10
If the owners, as a group, are not sufficiently unhappy to pass a resolution under section 27 of the Strata Property Act telling a strata council what to do, the courts are reluctant to interfere by overturning council’s decision or by otherwise telling council how to do its job. In general, so long as a strata council decides a matter within the proper exercise of its powers in the performance of its duties, the courts will not disturb its decision.
For example, in Enefer v. Strata Plan LMS 1564, a group of owners opposed the strata council’s decision to hire a particular individual to coordinate major building envelope repairs. 11 When the unhappy owners expressed their displeasure by blocking a special levy resolution to fund the repairs, another owner asked the court to authorize the special levy and direct the strata corporation to proceed with the repairs. In the court proceedings, the unhappy owners asked the court to overturn the council’s decision to hire the coordinator, as a condition of authorizing the special levy. The court ordered the special levy, but refused to overturn the council’s selection for the coordinator’s position. The court noted that overturning strata council’s decision would be akin to a judicially imposed section 27 restriction in a case where the owners themselves had not attempted to restrict the council by passing a section 27 resolution. 12
Although there may be no requirement to do so under the Act, a strata council may choose to require the eligible voters to vote on certain matters at a general meeting to ensure that the decisions made reflect the wishes of the majority of the eligible voters. Where the Act does not specify a certain type of vote, the type of vote necessary to pass a resolution at a general meeting is a majority vote. 13
Additionally, if eligible voters comply with certain requirements, they may influence the affairs of the strata corporation by requisitioning a special general meeting and requiring an item to be placed on the agenda of that meeting. 14
- For information about a leasehold strata plan, see Chapter 5, Freehold Versus Leasehold. ↩
- Strata Property Act, s. 1(1) (definition of “owner”). ↩
- A freehold sale involves the sale of a fee simple interest in land. In modern real property law, fee simple is largest interest in land in our system of private land ownership. In a Land Title Office, the fee simple owner is the registered owner. ↩
- With a proxy, however, the husband could exercise his wife’s vote. Alternatively, if the strata corporation passed a bylaw permitting a beneficial owner to vote, the husband could exercise the strata lot’s vote. For information about voting see Chapter 14, Voting. ↩
- The Owners, Strata Plan NW 499 v. Louis at para. 11. ↩
- Section 4(1) of the Standard Bylaws says, “within two weeks.” According to section 25(5) of the Interpretation Act, R.S.B.C. 1996, c. 238 we must calculate this two-week period by excluding the first day and including the last day, which translates into fifteen days. ↩
- Strata Property Act, s. 1(1) (definition of “eligible voters”). ↩
- Strata Property Act, s. 1(1) defines the term tenant to mean a person who rents all or part of a strata lot, and includes a subtenant. In the Act, however, the term tenant does not include a leasehold tenant in a leasehold strata plan as defined in section 199, or a tenant for life under a registered life estate. ↩
- Strata Property Act, ss. 27(2) and 92(b). ↩
- For information about the hardship exemption, see Chapter 22, Rental Restriction Bylaws. ↩
- Enefer v. The Owners, Strata Plan LMS 1564, supp. reasons on costs . ↩
- Enefer v. The Owners, Strata Plan LMS 1564 at para 39. ↩
- Strata Property Act, s. 50(1). ↩
- Strata Property Act, ss. 43 and 46(2). ↩