Daily Archives: April 13, 2009

By Martin K. I. Rumack

Condominiums and Co-ownerships are legal structures that define both the exclusive rights and the shared rights of individuals who purchase a unit/percentage interest in buildings created as one of these types of legal entity.

IMPORTANT FEATURES OF CONDOMINIUMS AND CO-OWNERSHIPS FOR THE PURCHASER

CO-OWNERSHIP

• Purchaser acquires ownership of a percentage interest in the Co-ownership Corporation by a Deed.
• Purchaser acquires exclusive right to occupy a specific unit through a registered Co-Ownership Agreement and the provisions of the Co-ownership Agreement.
• Purchaser acquires ownership of a percentage interest in the common areas of the building.
• Purchaser becomes a member of the Co-ownership Corporation which:
• (a)    manages the affairs of the building according to the Co-ownership Agreement, the Corporation’s By-laws and/or private Contracts, and the Rules and Regulations; and,
• (b)    represents the interest of the Percentage Interest Ow.    cte.
• Purchaser can individually finance her/his own unit, using their shares and interest in the unit. A limited number of lending institutions finance these types of purchases of shares and/or grant mortgages on these types of properties.
• Purchaser pays for their percentage share of property taxes as a part of their monthly common expenses. The Co-ownership Building is assessed and taxed as one structure.
• Purchaser is assessed for percentage share (based on the size of unit in comparison to the whole building) of the common expenses.
• No legislation requiring a Capital Reserve Fund, but Co-ownership Agreement may require a Capital Reserve Fund to be established for maintenance of building. No legislation exists requiring or outlining requirements for a Reserve Fund Study. No legislation exists requiring compliance with the recommendations of a Reserve Fund Study.
• Purchaser can participate in management decisions by sitting on the Board of Directors and voting as a member at Annual General Meetings.
• Purchaser is subject to the Co-ownership Agreement, Rules and Regulations, and By-laws and other contractual documentation of the Co-ownership Corporation.
• Purchaser does not need consent of the other co-owners or Co-ownership Corporation to sell, rent or mortgage his/her unit. There is the odd exception.
• Purchase of unit should be subject to receipt of an Estoppel Certificate which identifies any outstanding or pending payments, special assessments, or legal actions, re: the unit or corporation, amongst other items together with all other documents included.
• Co-ownerships may have yearly audited Financial Reports issued to all owners and are managed by a professional Management Company Or self-managed.

CONDOMINIUMS

• Purchaser acquires ownership of an individual unit by a Deed.
• Purchaser acquires ow rei.    hip to individual unit by a Deed pursuant
• to provisions of The Condominium Act.
• Purchaser acquires a percentage interest in the common areas of the building.
• Purchaser becomes a member of the Condominium Corporation which:
• (a)    manages the affairs of the building according to the Condominium Act, and more particularly the Declaration, the By-laws, and the Rules and Regulations; and,
• (b)    represents the interests of the Owners.
• Purchaser can individually finance her/his own unit. Large number of lending institutions finance purchases of condominiums and/or grant loans on these types oft.    one ties.
• Purchaser receives an individual property tax bill.
• Purchaser is assessed for percentage share (based on the size of unit in comparison to the whole building) of common expenses.
• Condominium Act requires a reserve monetary fund to be established for maintenance of building. Most comply with the provisions of the Act and generally with the Reserve Fund Study. Study must be updated every 3 years.
• Purchaser can participate in management decisions by sitting on the Board of Directors and voting as a member of the Condominium Corporation at Annual General Meetings.
• Purchaser is subject to the Declaration, Rules and Regulations, and By-laws of the Condominium Corporation.
• Purchaser does not need consent of the other owners or the Condominium Corporation to sell, rent or mortgage his/her unit.
• Purchase of a unit should be subject to receipt of a Status Certificate which identifies any outstanding or pending payments, special assessments, or legal actions, re: the unit or corporation, amongst other items together with all other documents required to be included.
• Condominium Corporations must have yearly audited Financial Reports issued to all owners and are almost always managed by a professional Management Company.

Martin K. I. Rumack is a Toronto based Barrister and Solicitor and is a regular contributor to the Muddy York Blog. Contact Information:  202 – 2 St. Clair Avenue East, Toronto, Ontario, M4T 2T5, Tel:  (416) 961-3441 (Ext. 26)