Condo owners ordered to pay developer back $1.3 million

Court ruled that 202 owners are on the hook for shared building costs that had been unpaid since the Burnaby tower opened five years ago

By
Burnaby Now
September 22, 2020





Sovereign tower in Burnaby’s Metrotown | Google Street View
— Sovereign tower in Burnaby’s Metrotown | Google Street View

A B.C. Supreme Court judge has ordered 202 condo owners in a mixed-use Burnaby highrise to pay more than $1.3 million in unpaid shared building costs plus interest to its commercial neighbour.

Bosa Properties, which owns the Element by Westin hotel and retail space at the Sovereign (4508 Hazel Street), took the building’s residential strata corporation to arbitration last summer, alleging the condo owners hadn’t paid their full part of the shared costs of a swimming pool, a roof deck, window washing, a parkade and GST since 2015, according to a B.C. Supreme Court ruling last month.

In December 2019, the arbitrator found in Bosa’s favour, awarding the company, which had also built the Metrotown tower, $1,295,593.27.

The interest on the award has continued to run on at a daily rate of $293.97 since then, according to court documents.

The strata applied to B.C. Supreme Court for leave to appeal the arbitrator’s decision.

One of the arguments it made was that the arbitrator had failed to apply the principle of contra preferentem.

The principle is this: If a court is unable to resolve an ambiguity in a contract dispute, the language of the contract should be interpreted against the author of the contract and in favour of the other party – if the other party has had no meaningful chance to modify it.

The Sovereign’s cost-sharing agreements that the strata and Bosa were arguing over had been made by the developer before the strata corporation was created or at a time when Bosa “was both the building developer and the entity in control of the strata corporation,” according to court documents.

“In that fashion, the agreements are atypical because (Bosa) was essentially contracting with itself,” B.C. Supreme Court Justice Neena Sharma said.

But Sharma dismissed the strata’s contra preferentem argument, saying the strata had not shown there was any ambiguity in the agreements to make it relevant.

In an August 7 ruling, Sharma noted the bar for interfering with an arbitrator’s decision was “very high” and said the strata had not raised any questions of law to warrant an appeal.

Bosa, meanwhile, applied to the court for an enforcement order to force the strata to pay up.

In a sworn statement, Bosa’s director of commercial properties, John Martin, said that Bosa doesn’t have the cash flow to be able to carry on operations while the strata hadn’t paid its full share of the costs since 2015.

The strata argued an enforcement order was not required, but Sharma disagreed, saying the strata had not given her enough evidence to show it had taken “significant steps” earlier on to pay the award.

 


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