Changes to the Condominium Act: A Guide to the New Condominium Guide

Post by Annie Bailey

Effective January 1, 2021, the Condominium Act, 1998 (the “Act”) will be amended to require condominium developers to provide potential purchasers of pre-construction and newly-built condominium units with a “Condominium Guide.”

If you are a developer or a potential purchaser of a pre-construction or newly-built residential condominium unit, this new Condo Guide is very important for you. For others, including those who currently own a condominium unit, are purchasing a unit in an existing condominium, or work in the condominium industry, the Condo Guide is a valuable educational resource.

The purpose of the Condo Guide is to provide potential purchasers of condominium units with reader-friendly, understandable information on the process and risks of buying a pre-construction or newly-built condominium unit, as stated by Ontario’s Ministry of Government and Consumer Services. The Condo Guide will assist these potential purchasers with making informed decisions about their purchase. Some of the topics covered include:

  1. Condominium corporations;
  2. Buying a pre-construction unit (including delayed occupancy and interim occupancy);
  3. Warranty coverage with Tarion;
  4. Governing documents and why you should read them;
  5. Condominium living (including owner rights and obligations);
  6. Common elements and common expenses; and
  7. Condominium governance, finances, and management.

The Condo Guide was prepared by the Condominium Authority of Ontario (the “CAO”) and approved by the Minister of Government and Consumer Services. This process ensures that all potential purchasers will receive a copy of the same government-reviewed information. You can access the Condo Guide here:

The Act gives the Minister (and by extension, the CAO) discretion to create different versions of the Condo Guide that apply in different circumstances and to different types of condominiums. The version of the Condo Guide that has been released so far applies only to residential condominiums. So if you are purchasing a commercial condominium unit, this Condo Guide does not directly apply to you. However, the general information in the Condo Guide may still be useful for commercial condominium unit owners. We may also see different versions of the Condo Guide released in the future.

The Condo Guide is an additional document that developers (or those acting on behalf of a developer) must deliver to potential purchasers along with the already-required Disclosure Statement when potential purchasers sign an Agreement of Purchase and Sale for pre-construction or newly-built condominium units. Regulations under the Act have not yet been released specifying how the Condo Guide must be delivered, so for now, it is likely best for developers to deliver it in the same manner in which they already deliver the Disclosure Statement.

After receiving the Condo Guide, Disclosure Statement, and fully signed Agreement of Purchase and Sale, potential purchasers have 10 days to review the documents (ideally with their lawyer) and to decide if they wish to proceed with their purchase. This is known as the “10-day cooling off period,” and potential purchasers may rescind their Agreement of Purchase and Sale by written notice within this timeframe if they so desire. While the “10-day cooling off period” is not new, the requirement to include the Condo Guide is new.

Developers, please speak to your lawyers about these upcoming amendments to ensure you are providing proper disclosure to your purchasers after January 1, 2021. You must provide the Condo Guide to all new residential purchasers entering Agreements of Purchase and Sale in the new year, even for projects that went to market before January 1, 2021.

Purchasers, you can expect to receive this Condo Guide if you purchase a pre-construction or newly-built residential condominium unit in the new year.

Renewal of a Commercial Lease and the Doctrine of Waiver

The Take Away

Once a party waives an enforceable legal right its ability to then enforce such right is not immediate.

The Case

A recent decision of the Court of Appeal reaffirmed the manner in which a party may revoke its waiver.

In North Elgin Center Inc. v McDonald’s Restaurants of Canada Limited, the parties had entered into a commercial land lease agreement for a period of 20 years (the “Lease”).  The Lease was subject to renewal.  The parties agreed the Lessee, McDonald’s Restaurants of Canada Limited, had provided its written notice to renew the Lease within the required period, however, the parties continued to negotiate the rental rate after the deadline to set such rental rate pursuant to the renewal provisions of the Lease.

The application judge held that through such negotiation the Lessor, North Elgin Center Inc., had waived its right to enforce the strict terms of the renewal provisions in the Lease.  The application judge later found that the Lessor’s waiver was revoked by an email sent by the Lessor to the Lessee.

The Court of Appeal disagreed.

The decision emphasises that to be effective, revocation of waiver requires:

  1. reasonable notice to be provided to the receiving party;
  2. the notice to include a clear indication that the party who granted the waiver will insist upon the strict enforcement of its legal rights; and
  3. the receiving party to be provided an opportunity to cure any defect resulting from its reliance on the waiver.

The full decision can be found here:

The Importance of Abutting Land Searches in the Land Titles System

Post by: Carly Haynes

There are two systems of land registration in Ontario, Land Titles and Land Registry. Historically, land in Ontario was registered only under the Land Registry System pursuant to the Registry Act. In this System all land registration documents are submitted to the Land Registrar and are recorded, in the order they are submitted, on the abstract for the geographic area they affect within a Land Registry Office (“LRO”).  Under this System, the documents are registered on title, but the provincial government does not guarantee the effect of such documents or title to properties.  Consequently, in under to satisfy oneself of title under the Registry System, land registration documents must be searched 40 years into the past in order to assess the validity of title.

In the Land Titles System the provincial government has the responsibility for the validity and security of all instruments registered on title. The vast majority of land in Ontario has been converted to the Land Titles Automated System. Title registered and certified under the Land Titles System is guaranteed by the provincial government, and the record is updated each time a land registration document is registered.

Following a recent trend of case law, it has become clear that despite the fshutterstock_73408681act that the provincial government guarantees title of land registered under the Land Titles System, land owners may still be held responsible for administrative errors where said errors were reasonably discoverable.  This highlights the importance of undertaking abutting land searches and title searches, regardless of the acquisition of title insurance.  This raises the questions as to whether title can ever really be absolute.

In 923424 Ontario Limited v 1695850 Ontario Inc. Justice Perell found that a landowner cannot rely on the lack of express notice of a right of way on servient land to extinguish the right of way.  In this case the existence of a right of way was registered on the abstract of the dominant property, but was absent from the abstract of the servient property. The servient landowner in these circumstances argued that as a result of the failure to register the right of way following conversion of the property from the Land Registry System to the Land Titles System, the right of way was extinguished.

All parcel abstracts for land expressly stipulate that the abstracts are subject to paragraph 2 of section 44 (1) of the Land Titles Act, which provides that unless the contrary is expressed on the register, the registered land is subject to certain liabilities including easements.  This section serves as notice that the land may be subject to a right of way. The court found that despite lack of express notice of the right of way registered on the servient property, the landowner had implied notice through the section 44 statement found on the parcel abstract.  As such, had the landowner heeded the section 44 instructions and undertaken an abutting land search, the right of way would have been discovered and costly litigation could have been avoided.

The Takeaway  

This case reinforces the importance of abutting land searches when undertaking a title search prior to property acquisition.  While many title defects may be protected by title insurance, it remains necessary to complete all title searches to protect against unlikely errors and obtain clear title.


Post by: William Thompson


Recently, we have had more clients building mid and high rise condominiums apartment buildings with the intention of retaining title to the entire building and renting the suites.  When a developer decides to keep title to the building for rental purposes, the developer assumes the role of landlord and enters into the realm of tenant protection legislation.  Now, one expects tenant protection legislation to impact matters such as rental rates and increases but one wouldn’t expect it to impact decisions around building design and construction.  However, recently we encountered a regulation with respect to billing tenants for electricity consumption that every rental property owner or developer needs to know.  It is important to emphasize that this legislation potentially applies to all forms of rental buildings, regardless whether the residential suite in question is a condominium, townhome, single family home or suite in an apartment building.

The Legislation

In subsection 40 (3) of Regulations 389/10 to the Energy Consumer Protection Act, 2010, it provides that:

(3)  A suite meter provider shall not bill an occupant of a rental unit or a member unit based on the consumption or use of electricity by the occupant in respect of the unit, as measured by a suite meter, if,

(a) the suite meter was installed after the day this section comes into force but is not deemed under subsection 43 (2) to have been installed after the day this section comes into force;

(b) the unit is heated primarily by electricity; and

(c) the electricity measured by the suite meter includes the electricity used in heating the unit.

In simple terms, what this subsection is saying is that if electricity is the primary heat source for a rental suite constructed after 2010, the landlord of the unit will not be able to use a single hydro meter to meter electricity consumed in the suite and bill the occupant for such consumption.  The logic behind this provision is highly questionable and now with the proliferation of packaged terminal air conditioner (PTAC) units providing heat, many of which are electric, it is a problem for developers.

Essentially, a developer has four choices if the developer chooses to heat a rental suite with a PTAC unit:

  • install a natural gas PTAC system if feasible given the building design and budget;
  • install two hydro meters, one to measure electricity consumption by the PTAC system and the other to measure consumption by the lights, plugs, appliances etc. and bill the tenant for both amounts;
  • separately measure and bill the consumption by the lights and plugs etc. in the residential suite with a single meter that does not measure the consumption of electricity by the PTAC system and include an estimate of the consumption by the PTAC system in the base rent; or
  • include all electricity consumed by the tenant in the base rent for the residential suite.

Obviously none of these options are ideal.  In particular, there is a significant cost to having two meters.  On the other hand, options (c) and (d) add exposure to the developer, especially as the PTAC systems are typically controlled within the residential suite and the rent cannot vary based on actual consumption.

And while none of the solutions are ideal, at least if a developer is aware of the issue, the developer can determine the best course of action during the planning stage of the building and avoid nasty surprises after the fact.

As noted, it is difficult to understand the thinking behind this provision.  Options (c) and (d) do nothing to encourage conservation by tenants and impose risks on the developer that to a large extent are controlled by the tenant because the tenant will likely control the level of heating and cooling in the residential suite.  Options (a) and (b) may not be feasible or cost effective.  Regardless, developers need to be aware of the legislation and the impact it could have on their building and future operations.

Development Charges Season

Post by: Craig Robson

Many municipalities in Ontario are currently undergoing a review of their development charges bylaws for 2014 implementation.

Anyone who is involved in real estate development should be paying careful attention to these reviews.

It is not unusual for a developer to determine that provisions in a development charges bylaw are not as favourable to that developer as they could or ought to have been.  For example, a few missing words in a definition within the bylaw can defeat a right to claim certain exemptions or credits.

Now is the time to be reviewing any definitions in a proposed development charges bylaw which may affect your development and to try to have those definitions “tweaked” as necessary to accommodate the developments you may be undertaking during the life of the bylaw (usually five years).

If nothing else, you should be keeping an eye on the proposed amounts of the development charges so that if the charges are increasing you can attempt to take out any requisite building permits to fix the amount of the charges at the old rates prior to the implementation of the new rates.

In addition, if there are any capital works which your proposed development may need in order to proceed, such as for example, a road or trunk sewer, a careful review of the background study relevant to the proposed bylaw should be undertaken.

You should attempt to ensure that all necessary capital works, to the extent any of them could be considered to be “growth related”, are:

  • shown as included in the capital works to be completed within the background study relating to the new bylaw; and,
  • that such capital works are scheduled to be completed within a timeframe which will accommodate your proposed development.

Otherwise, you could be faced with the prospect of having to either delay your development or, if the municipality will allow you to do so, pay the cost of the capital works without any guarantee of reimbursement.  Even if the municipality is inclined to reimburse you for the cost of any capital works that you undertake on its behalf, there may be difficulty in completing such arrangements if the proposed capital works are not contemplated by the background study that gives rise to the final development charge amounts in the bylaw.


Post by: Khiam Nong

Builders who sell new or substantially renovated housing need to be aware of the HST New Housing Rebate (“NHR”).  The NHR can be assigned to a builder from home purchasers (“Purchasers”) on the unit/home sale closing.

Builders and Purchasers of new homes also need to be aware of the fact there is a rebate of HST available to the landlord of a new property (including a single home or residential condominium unit) if the first occupant of the property is a tenant.  This rebate is referred to as the New Residential Rental Property Rebate (“NRRP Rebate”).

Purchasers who rent out a new home so that the first occupant of the new home is a tenant are entitled to the NRRP Rebate but cannot obtain the NRRP Rebate from the builder.  Such Purchasers must apply for the NRRP Rebate directly after closing.  To find out how and where to file the NRRP Rebate application, see page 31 of the Canada Revenue Agency (“CRA”) publication found here.

In markets with the potential for Purchasers to acquire property for investment purposes, builders should be aware of the existence of the NRRP Rebate so they can advise their Purchasers of the existence of the rebate.  The obligation for a Purchaser to pay the full 13% HST without being aware of the NRRP Rebate can discourage a Purchaser from completing the purchase.

Further, awareness of the NRRP Rebate may also deter misrepresentation by Purchasers to the CRA.

Of late, we have noticed that, in order to avoid being responsible to their builder for lost NHR, some Purchasers have been dishonest about their intentions to rent out a property and misrepresented that they intend to occupy the property as their primary place of residence.

If Purchasers are made aware that they can obtain the NRRP Rebate on new homes that they lease out to tenants, we suspect some of this dishonesty will be dissuaded.

New Housing Rebate

The NHR allows Purchasers to recover some of the federal portion of the HST, which is 5% in Ontario.  For homes with a base price (exclusive of any HST or rebates) up to $350,000, Purchasers may recover a rebate of 36% of the 5% federal portion.  The allowable rebate declines on a sliding scale when the purchase price is between $350,000 to $450,000.  If the base price is or exceeds $450,000, the federal portion of the NHR is not available.

Regarding the remaining 8% of the HST, which is the provincial portion, Purchasers may recover 75% of the 8% provincial portion up to a maximum of $24,000.  Unlike the federal portion, the amount of the provincial portion of the NHR does not slowly decline once the purchase price reaches $350,000.00.  The provincial portion of the NHR simply does not apply to any purchase price in excess of $400,00.00, thereby limiting the amount of the provincial portion of the NHR to $24,000.00.

For the purposes of the NHR, the term “builder” generally includes a person in the business of constructing or substantially renovating houses for sale, but may also include:

(i)                 a manufacturer or vendor of a new mobile home or floating home;

(ii)               a person who buys a previously unoccupied new house for resale;

(iii)             a person who acquires an interest in a house while the house is under construction or substantial renovation and completes or engages another person to complete the construction or substantial renovation; or

(iv)              a person who has converted a non-residential property into a house without substantially renovating the property. [1]

A “builder” for the purposes of the rebate acquires, builds or substantially renovates housing (or hires someone else to do so) as its trade.

An individual who buys, builds or renovates a house to use as his or her primary residence does not fit the definition of builder, however, such an individual is still entitled to the NHR if he or she meets all of the usual criteria.

Purchasers may assign the NHR to their builder.  The builder may apply for the rebate on the Purchasers’ behalf.

A builder may pay the total amount of Purchasers’ NHR directly to them or credit that amount on the purchase price of the house.  It is highly unusual to pay the NHR directly to Purchasers.

A builder who chooses to credit Purchasers with the amount of the NHR must send in a fully completed Form GST190 and all applicable provincial rebate schedules.

The following is a list of additional conditions Purchasers must meet to qualify for the NHR:

(a)               the Purchasers bought a new or substantially renovated house from a builder and HST is due on closing;

(b)               the builder sold the Purchasers the house and related land on which the house is located under the same written agreement of purchase and sale;

(c)                when the Purchasers signed the agreement of purchase and sale, it was intended to be the primary place of residence for the Purchasers or their relations;

(d)               ownership of the house is transferred to the Purchasers after construction or substantial renovation is completed;

(e)               no one occupied the house before possession being given to the Purchasers; and

(f)                 the Purchasers or their relations are actually the first occupants of the house after construction or substantial renovation.

One of the main criterion for eligibility for the NHR is that Purchasers, or their relations (meaning immediate family members related by blood, marriage, common-law partnership or adoption within the meaning of the Income Tax Act), must use the house/unit as their primary place of residence.  The factors the CRA considers when determining whether a house is an individual’s primary place of residence include:

○                    whether the individual considers the house as their main residence;

○                    the time the individual has lived in the house; and

○                    the designation of that address on personal and public records.[2]

Purchasers who fail to meet all eligibility requirements should not be entitled to the NHR and if the NHR is obtained, can be required to repay the rebate.

New Residential Rental Property Rebate

The NRRP Rebate is obtained by Purchasers making an application as noted above.  The NRRP Rebate cannot be credited to the Purchasers on closing by the builder.

The application for the NRRP Rebate must be filed within two (2) years after the house purchase closes.

The amount of NHR is calculated on the same basis as the NRRP Rebate.  Generally the rules for eligibility are the same as those considered in respect of the NHR.

It is important to note that Purchasers will have to repay the NRRP Rebate if they should sell their home within one (1) year after it is first occupied as a primary place of residence after construction, unless the home is sold or leased to an individual who will occupy the home as their primary place of residence.

The foregoing is a summary of the HST rebates available when selling or buying a new or substantially renovated home/unit.  For more detailed information on the NHR and the NRRP Rebate, see the following CRA publications or talk to your tax advisor.

[1] RC4028 GST/HST New Housing Rebate, page 6,, February 26, 2013.

[2] Ibid.

Don’t Wait Too Long – Tarion, Bulletin 19R and New Condominiums

Post by: Craig Robson

We received a call recently from a prospective client who was interested in developing a condominium project.  The conversation went something like this:

Caller: – “We are looking at doing a 6 storey apartment condominium.”

Lawyer – “What stage are you at?”

Caller – “4th floor is being worked on now.”

Lawyer –“Are you looking to sell the units or rent them?”

Caller  “Rent.”

Lawyer – “Good.”

Our response was based on the fact that if the caller was intending to sell new residential units out of the project, the project would be subject to the Ontario New Home Warranties Plan Act (“ONHWPA”) jurisdiction.  The entity responsible for administering the ONHWPA is the Tarion Warranty Corporation (“Tarion”).

If the caller was planning on selling new residential units, the project would then likely be subject to Bulletin19R “Condominium Projects: Design and Field Review Reporting” (“19R”).  19R came into effect on July 1, 2010 (replacing a similar long standing bulletin).

19R applies to vendors and builders of proposed condominiums that have both Part 9 and Part 3 Ontario Building Code (“OBC”) construction requirements and proposed condominiums that have only Part 3 OBC construction requirements.

For most of us who are not schooled in interpreting the OBC it is not always clear when 19R will apply.  Its applicability can sometimes be a surprise.  The basic assumption by some is that it only applies to “high rises”.  The true test of applicability is what part or parts of the OBC apply.

The question of what part(s) of the OBC apply to a proposed residential project should be put to the project engineer or architect at the outset of any such project if there is any thought of selling units.  This question should be posed well before any construction gets underway if there is any chance of the project being subject to ONHWPA.  Tarion asks the question in its application form but we have seen those applications prepared from time to time without careful consideration (called guessing) of what part of the OBC applies.

For the caller referred to above, she would have had a major issue if her intention was to sell residential units out of the project.

Her first issue would be that she should have enrolled the project in ONHWPA before construction started.  That in itself is an exercise of some length.

The bigger problem is with respect to 19R.  19R requires a lot of paperwork, submissions and professional reviews starting before and during all aspects of construction.  The caller in the above example may have simply been unable to comply with 19R because her project was too far along in the construction process to be able to comply with 19R’s preconstruction and submission requirements that are required before and in the early stages of construction.

19R adds a lot of red tape and cost to a project but cannot be ignored with respect to projects to which it applies.  Not being able to comply with 19R requirements may preclude a project from being brought into ONHWPA registration/enrolment.  If a project does not have this registration/enrolment, the builder is not allowed to sell the new previously unoccupied residential units in the project.

The Take Away

  1.  If there is any chance that there will be sales of new residential units in a new project, contact Tarion immediately and at the very least find out what the process is to comply with their requirements.
  2. If sales of new residential units are intended:
    • get the process underway with Tarion well in advance of construction commencement.  It can take a while; and
    • determine with certainty whether 19R applies well before any construction starts.  If 19R applies, make sure all relevant members of your project team know what is required of them – and then make sure they do it.  A qualified member of your project team should be charged with coordinating all of the 19R requirements.

Home Builders: 7 Tips for Fostering Good Neighbourly Relations

Post by: Craig Robson

Ontario home builders who are venturing into built up areas to develop homes or condominiums have good reason to be neighbourly.

In built up areas, it often happens that neighbours develop a keen and sometimes vocal interest in a project.  They may, with some justification, feel that they have a vested interest in the development, given that they will look at the completed project every day, be subject to some level of construction, traffic, shadows, noise, and other issues that might be caused by the project.

The range of concerns may range from the wholly reasonable to the absurd.  Even if concerns are not well founded or are based on false information, the risk to the home builder is that the neighbours mount a campaign intended to either change, delay, or block the proposed development.

A home builder’s best defence against such opposition is to consult with neighbours from the outset and respond to their concerns.  Specifically, home builders should:

  1. Provide information about the project to neighbours from early on.  Communicate how the project has been designed to integrate with the existing neighbourhood and limit the potential for land use conflicts or other adverse impacts.  Also give them as much information as possible about what is proposed for construction and the expected timeline;
  2. Consider convening one or more neighbourhood information meetings where the home builder can present the project in the best light;
  3. Consider setting up a website that is updated as new information about the project comes available. This should only be done where the home builder is prepared to keep the information current.  The website can also be a spot for soliciting neighbours’ comments about the project, either by e-mail or through a “Comments” form;
  4. Respond to any misinformation about the project which sometimes develops due to rumour or speculation.  If the project is a well-designed project with demonstrable community benefits, then there is every reason to keep the neighbours well-informed;
  5. For a mixed-use project, consider asking neighbours what commercial uses they would like to see in the neighbourhood.  This could reveal an unexpected need for commercial components that would otherwise be missed;
  6. Provide information about why the project is a good project for the neighbourhood and the wider community.  It is not enough that a project is expected to be a profitable one for the home builder.  Home builders should know and be able to summarize the key community benefits that will flow from individual projects; and
  7. Adjust the project to respond to legitimate concerns.  Municipal officials will often appreciate anything a builder can do to defuse a potentially tense neighbourhood situation.

Doing the above and providing information and a forum for feedback from neighbours may allow for a smoother and faster process despite the initial time it takes.  It also allows the home builder to get a better idea of the arguments it may face and provides time to build a response or defence to those arguments.