Government of Ontario — How Condos Are Run

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In some ways, a condo development is like a small municipality. The owners of each unit are members of the condo corporation and have the right to vote at meetings (1 vote per unit).

An elected board of directors, like a town council, makes decisions on behalf of the owners, and often hires staff to carry out the work. Just as towns have a town manager, condominiums often have a condominium manager.

Condo corporation

The condominium corporation is responsible for managing the condominium:

  • property
  • finances
  • corporation records
  • reserve fund study
  • all other related matters

As an owner you are a member of a corporation. It is similar to, but not the same as, being a shareholder of a business corporation.

Board of directors

Owners elect a board of directors to oversee the condo property and the affairs of the condo corporation.

The board typically meets once a month to conduct business. Among other things, it must:

  • ensure the condominium property is maintained and that repairs are carried out as needed
  • ensure a reserve fund study takes place every 3 years and that the fund can cover major repairs to the common elements and or any assets of the corporation
  • monitor financial reporting and oversee financial operations
  • organize an annual meeting of the condo unit owners and any other owner meetings that may be needed
  • propose by-laws that deal with the responsibilities and powers of the board (e.g., how meetings will be run, how common expense fees will be collected) — a majority of unit owners have to vote in favour of these proposed by-laws in order to make them valid
  • make rules to promote the safety, security and welfare of the owners
  • direct or delegate daily operations to a property manager
  • provide financial and operational records to owners (owners must make the request in writing and may have to pay a fee)
  • supply status certificates when requested (owners should make the request in writing and may have to pay a fee)  
  • keep up-to-date on best practices for condo governance and management
  • run the corporation in compliance with the Condominium Act
  • ensure directors and officers perform their duties with care, diligence and reasonable skill (this is called upholding a directors’ standard of care)

Voluntary training on condo governance and the responsibilities of condo directors is available from industry associations.

There are no training requirements to become a condominium board member.

The board must have at least 3 directors. Each director must:

  • be at least 18 years of age
  • not be in a state of bankruptcy
  • be capable of managing property within the meaning of the Substitute Decisions Act
  • act honestly, in good faith and exercise due diligence
  • exercise reasonable care and skill when fulfilling his or her duties
  • disclose conflicts of interest in writing

Directors are elected for a term of up to 3 years and may run for re-election. Most condominiums elect directors to terms that overlap so that there will always be a board member with operational history.

Directors may be removed from office by a majority vote at an owners’ meeting. Owners may then elect a replacement.

Condo manager

Condo corporations may hire a condo manager (or a condo management business) to oversee day-to-day operations.

Different types of condominiums have different management needs, depending on the size, age and nature of the property. A condo manager may:

  • collect common expense fees
  • keep records for the condo corporation
  • respond to owner complaints
  • ensure maintenance and repair of the property
  • hire and monitor service companies and oversee staff and contractors
  • prepare draft annual budgets and oversee the reserve fund use
  • implement an emergency management plan and respond to emergencies
  • prepare status certificates
  • issue meeting notices, report  regularly on the affairs of the corporation
  • board meetings and oversee administration of all owners' meetings
  • monitor the corporation’s insurance
  • prepare financial reports and arrange for audits

The condo manager may also advise the board on:

  • how to comply with the Condominium Act
  • how to comply with legislated or mandatory repairs required by government
  • the financial responsibilities of the board (e.g., contributions to the reserve fund and long-term reserve fund planning)

The condo manager is accountable to the condo corporation.