Vancouver condo expert Gerry Fanaken calls for legislative change to rein in strata council bullies
Veteran property manager Gerry Fanaken likes to refer to strata councils as a “fourth order of government”.
That’s because condo owners elect a group of residents to serve on the board of the strata corporation. These politicians end up overseeing their neighbours’ strata fees. And like other elected officials, they sometimes act in a high-handed manner toward their constituents.
“To be clear, many strata-council members give a lot of their time and do a very good job,” Fanaken tells the Georgia Straight over the phone from Pender Island. “I’m not dumping on everybody. But there are lots of bullies out there—lots of people that completely violate the law and run the buildings the way they want to and not the way the Strata Property Act says. And there’s no recourse against them, no recourse of any substance.”
For over 30 years, Fanaken was CEO of Vancouver Condominium Services Ltd., which managed the affairs of about 165 strata corporations. When the Strata Property Act was introduced in 2000, he wrote a 230-page book explaining how it would change the way multifamily buildings were managed in B.C.
Now a consultant, he has followed that up with a recently released self-published book, Understanding the Condominium Concept: An Insightful Guide to the Strata Property Act. It reviews how the law has been interpreted since its introduction by the last NDP government.
“One of the aspects that has changed significantly in the last 10 years is strata-management companies are required to be licensed through the Real Estate Council [of B.C.],” Fanaken says. “That has changed the way property-management companies conduct their affairs…so this is a good aspect for condo owners. Their monies are far more protected than they ever were before.”
It has also contributed to greater consolidation in the industry. Last year, a Texas-based property-management company, Associa, bought one of the local giants, Baywest Management Corp. And Fanaken says that Florida-based FirstService Residential Management bought his company and Crosby Property Management.
“Those two companies probably account for the largest number of stratas that are managed in the Lower Mainland,” he notes.
However, Fanaken says there has not been a corresponding increase in accountability for the homeowners and tenants elected to serve on strata councils. Residents who feel they’ve been treated unfairly by a strata council usually only have one option: going to court to get a judge to overturn a decision. And that can get very expensive.
“I see so many violations of the act by some council members,” Fanaken says.
He maintains that some councils spend money that’s not authorized in their budgets. Others levy unwarranted penalties on residents in the absence of any due process.
When asked for a solution, he suggests that the Strata Property Act be amended so fines can be levied against council members. “Once somebody gets elected—it doesn’t matter how they got there or what their eligibility is—if they step out of line of what’s required by the act, they should be held to account,” Fanaken declares.
According to Understanding the Condominium Concept, the Strata Property Agents of B.C. estimates that more than $1.5 billion is overseen by strata corporations in the province, including $500 million in contingency reserve funds. Fanaken reports in the book that strata-corporation annual budgets range from $200,000 to $1.5 million, with the average being around $600,000.
“If a management company has 100 clients, that means some $60 million passes through its hands each year,” he writes. “And that is for a mid-size firm.”
In the vast majority of cases, residents serve on strata councils without compensation. That is “truly admirable”, according to Fanaken.
However, he points out in his book that Strata Property Act provisions requiring the disclosure of conflicts of interest are “routinely ignored”.
“On occasion, a good property manager will raise the yellow flag at a council meeting to alert all council members of the requirements; however, their efforts are often met with indifference or even hostility,” he writes.
Comments
10 Comments
Gerry
May 22, 2013 at 11:47pm
How do you get councils to do needed maintenance?
DavidH
May 23, 2013 at 10:57am
@ Gerry: Good question. I don't think you can. Over the years, maintenance on my strata complex has declined dramatically ... to the point that it's now affecting property values.
Sadly, the reason is simple: The unit price here is low enough that the complex attracts people who are eager for "starter homes". By the time the deal is done, they've spent every nickel of savings on acquisition costs, and have zero left for increased maintenance, special assessments, etc. They fight every attempt to spend money, because they don't HAVE any money.
But, it isn't going to change. As long as mortgage rates are low, lenders are willing, and people are still being brought up to believe that home ownership is both a human right and a life goal ... well ...
Alan Layton
May 23, 2013 at 12:12pm
Gerry - the first thing to do is it to read the city strata bylaws and the ones for your particular strata. There are some repairs that may be required by law and the council should be made aware of them. If you have a building management company make use of them for advice. What you may have eventually do is what I did, get on the council and convince the other members that a plan to take are of repairs, over time, needs to be made up. You may need to save some money up for those repairs ahead of time, but zero in on the ones that may cause the greatest damage first - such as a roof leak or overflowing gutters. As the article said, trying to enforce bylaws is expensive and takes time, but most people can be convinced to listen to reason eventually. If this doesn't happen I'd consider selling, since you may be facing huge repair costs in the future.
DG
May 24, 2013 at 8:46pm
There is a part of The Strata Property Act that requires the common property to be repaired and maintained. Building councils can be forced by an owner or owners to do the right thing. It is not easy but The Strata Property Act has this provision.
Dale Mclean
Jun 10, 2013 at 12:23pm
it should be in ( black+white). that boy friend and girl friend should not be aloud to set or vote on a strata
council.( conflict of interest )-(president and treasurer )
David Hutchinson
Jun 16, 2013 at 9:44am
One council on Nelson St downtown just voted down the building envelope re-caulking for $3,000,000--which is not a lot--by only getting 50% voted "yes." They lost because 65 were proxy votes for "No." Clearly these are investment rental units. What can be done? This maintenance of curtain glass wall is crucial.
J. MacDonald
Jun 18, 2013 at 3:48pm
My council signed up for a strata website (http://estrata.ca) about a year ago, and I'm so grateful. Every document, every conversation and every decision is online for registered site users to see. 'Sneaky' decisions are a thing of the past, and communication has improved tenfold. Our website is hands-down the best investment our council has made in the last 5 years.
David B
Dec 1, 2013 at 4:56pm
We have been embroiled in a dispute with our council in the Human Rights Tribunal for almost three years. The council is not even obliged to negotiate a settlement as there is no consequences for them sitting back and going to hearing. Strata Insurance is paying all their legal costs, but we have to pay our own. Even their Lawyer and a Tribunal Member tried to convince them to settle but it was a bust.
We will start a new action in Supreme Court this week, against the strata and some of the individuals on council.We believe it is intolerable that this 4th order of government is so well protected and we the owners/citizens are so poorly represented.
We are pondering the possibilities of a non-profit to campaign for legislation that would level the playing field, at least.
Through the various blogs and newsletters we have discovered that this is nowhere near a problem unique to BC but almost a universal dilemma across Canada. I'm sure it was not the intent of the Provincial Legislatures to isolate citizens from their Basic Human Rights as defined in Canada's Human Rights Act but that is what has happened and continues to happen on a daily basis.
This reinforcement of bullying tactics, by strata insulation, Provincial Legislation and a frightened/ineffectual silent majority is intolerable and MUST be dealt with.
Lee
Jun 7, 2014 at 6:36pm
I am sitting on a Strata Council right now and am having some difficulty with another council member who I perceive as being very hostile and attacking towards me. These attacks come in a number of repetitive and insistent emails about issues already discussed to the point where I am filtering her messages. My question is are there any standards of etiquette or rules of civility laid out by the Strata Corporation, and can newly legislated anti-bullying and harassment laws be applied to Codes of Conduct within Strata Meetings? In other words what protection do I have against this person?
Lee G
Apr 11, 2015 at 3:07pm
WOW, well I am happy that it is NOT ONLY our building that is having problems with Strata Councils not being fair for awhile I thought how can these people get away with these things thought of moving but then though why should I have to move after being here since 1999 and being unfairly picked on as I see it one thing after another.... They can't keep accounting records straight and leave things for a number of years and then attack you about it then you think it is settled only to have a NEW STRATA MANAGER come in and start all over again !!!! It helps to know that it's not only me that is having this problem.