The COVID-19 pandemic has caused significant disruptions for strata corporations in fulfilling their regular duties and responsibilities. As of May 29, 2020, amendments to the Strata Property Act provide some flexibility for strata corporations in adapting and responding to the challenges they currently face and similar situations in the future.
Provincial health guidelines on social distancing and restrictions on gatherings have complicated the process of conducting annual and special general meetings. The Strata Property Act sets out deadlines for calling:
- the first annual general meeting to be held by the owner developer
- annual general meetings following each fiscal year-end
- special general meetings called by voters
- special general meetings to consider winding up
- special general meetings to reconsider resolutions passed by 3/4 votes
- general meetings to decide against repairing or replacing damaged property
- annual general meetings following the deposit of a subsequent phase
The latest change to the Act extends the deadlines for all of the above an extra two months during states of emergency.
Additionally, following years of ongoing financial losses due to environmental disasters and rising costs of water damage claims, insurers have been dramatically increasing strata premiums and deductibles. As a result, many strata corporations must call special general meetings for authorization to draw from their contingency reserve funds or implement special levies to cover the full costs of premiums.
Under the Strata Property Act, a strata council can draw from the contingency reserve fund without a 3/4 vote if an immediate expenditure is necessary to ensure safety or prevent significant loss or damage. Following the recent amendment, this section of the Act can now be applied to insurance premium payments. A new provision specifically includes maintaining required insurance in the definition of "prevent significant loss."
Source: "Funding Insurance Premiums and Calling General Meetings: Welcome Changes for Strata Corporations" by Veronica Franco of Clark Wilson LLP (May 29, 2020).
For information and resources on insurance and risk management for strata corporations, please contact a CapriCMW Risk Advisor.