The Supreme Court of B.C. has upheld a Civil Resolution Tribunal order that a Vancouver strata refund special levy funds taken from an owner’s bank account.
The Vancouver strata held a virtual town hall meeting during the pandemic to discuss upcoming resolutions, including one to approve a $2.25-million special levy to fund a garden membrane.
The AGM notice was delivered on Feb. 3, 2021 when COVID-19 gathering restrictions were in place.
The notice contained instructions for owners to vote on the special levy using a “restricted proxy ballot,” as it was described in the notice. Owners were required to submit proxy votes to either the strata president or building manager.
The AGM was held Feb. 25.
“They were encouraged not to physically attend the AGM due to the pandemic,” said Justice Andrew Majawa in the March 13 decision.
No option for virtual attendance was given — although the provincial government had made provision for just that 10 months earlier.
Majawa said that restricted owners’ ability to discuss issues and was a violation of an April 15, 2020 ministerial order allowing electronic attendance at strata AGMs.
“It is rational and tenable to conclude that (Daniel Day) cannot be bound by a resolution that he had no opportunity to participate in.
“The special levy was passed, and Mr. Day was compelled to pay $18,700.20 over three installments,” Majawa said.
On May 1, 2021, the strata withdrew $6,233 from Day’s account.
On May 12, 2021, Day emailed the strata, requesting a meeting with the strata president. He advised he would commence legal proceedings against the strata if the funds were not returned.
On May 21, 2021, the strata refunded the first installment to Day. Ten days later, he completed the sale of his unit.
However, on July 15, 2021, the strata held a second annual general meeting. Another resolution regarding the special levy was held and passed.
The strata took the position that the second resolution ratified the first resolution, making the special levy payment due on Feb. 25, 2021. The strata then deducted the payment from the proceeds of the sale of Day’s unit.
In response, Day filed a tribunal claim, seeking an invalidation of the first AGM so the payment amount would be released to him. The strata’s response to the tribunal claim said Day failed to formally request a hearing with the strata council as required under the Strata Property Act (SPA).
It further said that at no time prior to Day’s unit sale was the first resolution invalidated, as it was retroactively ratified by the second resolution. As such, the strata claimed, Day owed the strata the entire payment.
The tribunal did not agree.
It found the first AGM was not lawful, and that the levy wasn’t approved until after Day sold his property.
Day argued that the first AGM was invalid because no strata owners were permitted to attend or participate in discussions. Since Day sold his lot prior to the second resolution’s approval, he argued the tribunal finding that he was not required to pay the special levy was reasonable.
The tribunal ordered the strata to pay Day $18,758.
The strata then applied for a judicial review of the decision, saying the tribunal’s interpretation of the second resolution had resulted in an "irrational and absurd result."
Majawa found the tribunal was reasonable in concluding the levy was due and payable on the date of the second AGM, and in ordering reimbursement.
The court also upheld the tribunal finding that stratas had not been authorized to restrict an owner’s choice of proxy in the pandemic.
“The strata’s proxy voting procedure, which only allowed the owners to select either the strata president or the building manager as their proxies, was a restricted proxy contrary to the SPA,” Majawa said.
“The first resolution was no longer binding the moment it contravened the SPA or ministerial order,” Majawa said.