Debates of May 10, 2007 (day 4)

Clause 26.

Agreed.

Clause 27.

Agreed.

Clause 28.

Agreed.

Clause 29.

Agreed.

Page 6, clause 30.

Agreed.

Clause 31.

Agreed.

We now fast forward to page 22 of the bill. Clause 32.

Agreed.

Clause 33.

Agreed.

Clause 34.

Agreed.

Thank you. To the bill as a whole.

Agreed.

Thank you. Does the committee agree that Bill 1 is ready for third reading?

Agreed.

Thank you. Bill 1 is now ready for third reading. I would like to thank Minister Bell, Mr. Aitken, and Mr. MacDougall for helping us with this today.

The next item on our agenda, then, is Bill 2, An Act to Amend the Condominium Act. Does the Minister have any opening comments on the Condominium Act?

I do have them, if you can believe it, Madam Chair, in my other chair. So if I can go to my other chair and read the comments, I will do that and come back. Thank you.

No, you have to recite them from memory.

---Laughter

Minister Bell, when you are ready.

Madam Chair, I am pleased to appear before the committee to review Bill 2, An Act to Amend the Condominium Act.

This bill would bring the Condominium Act up to date. A number of amendments were made to address specific issues since the act was first passed in 1969 and the first condominiums were established in 1986, but a thorough review of the act had never been undertaken.

With this in mind, the Department of Justice developed a consultation paper in the fall of 2005. The paper was made available on the department's website and a copy was distributed to numerous stakeholders, including condominium owners, developers, management companies, real estate agencies and lawyers. Last spring, public meetings were held to discuss the proposals in communities that currently have condominiums: Yellowknife, Inuvik and Hay River. Public feedback indicated wide support for the proposed amendments. In addition, the consultations identified further changes that have been included in this bill.

A number of important amendments support the principle of consumer protection. While this legislation recognizes decision-making should be left to the owners because condominiums are privately owned buildings, there is also a need for owners, purchases, lenders and tenants to have the information necessary to make informed decisions.

Fundamental to the review of this act was issues relating to the capital reserve fund and the adequacy of such funds. This bill addresses several critical aspects:

every condominium would be required to establish a capital reserve fund;

a condominium would be required to conduct a reserve fund study every five years to assess the long-term needs of the condominium and develop a comprehensive plan to repair or replace depreciating property; and

the reserve fund study and plan, as well as other relevant material, would be provided to owners in advance of the annual general meeting, and the reserve fund would be a mandatory agenda item at the meeting.

Decisions regarding the amounts to be contributed to the fund would remain with the owners but these requirements will help ensure that owners are able to make knowledgeable decisions in this regard.

Further significant amendments to the act provide for:

improved disclosure of information to owners, purchasers, mortgagees and tenants;

a more orderly transition of ownership from the developer to the eventual purchasers of a new condominium, including protections for tenants on the conversation of rental accommodations to a condominium;

a more appropriate balance in respect of the majority of owners required to terminate a condominium or amend the plan, declaration and bylaws; and

the option for developers to develop condominiums in phases or for two or more condominiums to amalgamate.

I would like to thank the Standing Committee on Social Programs for its review of this bill. I look forward to responding to any questions the committee may have.

Thank you, Minister Bell. At this time, I will call on Mr. Robert McLeod if he would please provide the committee’s response to the Condominium Act. Mr. McLeod.

Thank you, Madam Chair. The committee held public meetings on Bill 2, An Act to Amend the Condominium Act, in Yellowknife on April 19th and 20th, and on May 8th in Tuktoyaktuk, and Inuvik on April 23rd, in Ulukhaktok on April 24th, in Colville Lake on April 25th, and in Behchoko on April 26th, 2007. The committee would like to thank the Minister and one presenter for appearing before the committee.

The proposed amendments will provide protection for consumers, provide direction to condo corporations on governance and financial planning, as well as broadening the scope of options available to developers interested in building and selling condominiums. Madam Chair, I would like to now turn it over to my colleague, Mr. Braden, to conclude the report. Thank you.

Thank you, Mr. McLeod. Mr. Braden.

Madam Chair, the one presenter to committee, Ms. Cathy Harper of Yellowknife was in favour of the amendments but had a concern with the final consultations by the Department of Justice being done during the Christmas season. It was pointed out by Ms. Harper, and rightly so, that this is not the best time of the year to be closing our consultations on government legislation. However, it was recognized by committee members that the department was working towards some tight deadlines and this is not regular practise.

Following the clause-by-clause review, a motion was carried that Bill 2 was ready for Committee of the Whole. This concludes the committee’s general comments on Bill 2. Individual members may have questions and comments as we proceed. Thank you, Madam Chair.

Thank you, Mr. Braden. That concludes the committee’s response. Thank you. I will ask if the Minister would like to keep his witnesses in the Chamber. Minister Bell.

Yes, we would like to do that. Thank you.

Thank you, Mr. Bell. Does the committee agree?

Agreed.

Thank you. Then I will turn to the Members for general comments. Are there any general comments? Ms. Lee.

Thank you, Madam Chair. I would like to just state how important this legislation is really in terms of consumer protection. It is quite surprising that some of the provisions being provided in this bill were either not completed or inadequately addressed in the original Condominium Act. In Yellowknife, I have lived here for…This is my 29th year. In the last 15 years or so, lots of condominiums have gone up or existing dwellings or apartment buildings, but they could be just a collection of housing units or mobile homes have condominiumized. There was a lot happening once in the early '90s. I think a lot of people might have fallen through the gap because of the fact that the legislation was not as strong as it should have been. It is unfortunate that, probably, some of them would not be able to take advantage of this legislation because, typically, legislation does not apply retroactively. In that way, I think that it is very important and good that we are able to address this now.

I have also been a condo owner. I was lucky in my ownership to be a member of the Condominium Corporation where the capital reserve issue or some of the responsibilities of the Condominium Corporation as a group were quite sophisticated and were able to take care of things and make sure the money is collected and they budget for it and they do forecasting. I don’t think that is the case for all the corporations. Hence, the need for this legislation. Also, I don’t think the general population will buy into condominiums. There are lots of condominiums on sale if you go to the real estate market in the city of Yellowknife. I am not sure if the potential buyers of condominiums are aware of what some of the things they should be looking into or even are aware of. One of the kinds of questions that I could ask…I remember when I was selling my condominium, I had a very sophisticated potential buyer who asked for lots of documents, but I don’t think that is the case for everyone. You are buying into a percentage of ownership of a corporation when you buy a condominium. It is not just the building and the house that you are buying.

I would like to ask the Minister who would be responsible for implementing this legislation for administrating this legislation. I assume it is the Department of Justice, but consumer protection section is with MACA. There used to be a separate section in the Department of Justice of consumer affairs, but we don’t have that anymore. I would like to ask the Minister who would be responsible for this. What kind of efforts will be made to let the people know that these legislative protections do exist not only for potential buyers of existing corporations, but also communities in the North who may be interested in condominiumizing their property? Thank you.

Thank you, Ms. Lee. Mr. Bell.

Madam Chair, it is our department’s act. We are the department that brought this forward. We do have currently available on the website, and I understand it goes out. There are condo owners or interested condo buyers. We have brochures and information that can go out about the existing legislation, existing state today. We are proposing that we would revise that once this legislation is passed and get some more information out there to those who might be interested in buying or selling. We will make them aware of the changes we have made to the legislation. I think the Member is right; we may see more and more of these in other NWT communities as we move forward. It is important that we get this information out. To the question, it is our department that has the responsibility for this legislation. Thank you.

Thank you, Minister Bell. Ms. Lee.

Thank you. Could I ask the Minister to engage his officials to do more, take an extra step? Maybe they are doing that already, but maybe I can get a confirmation from the Minister. I know that not everyone goes through realtors, but a lot of people go through realtors when they buy properties. When you are closing your transaction, realtors have packages of information for purchasers to be aware of whether they're banking, insurance information, fuel delivery and such. I am wondering if the Minister’s department will make a conscious effort to get those documents to them. I am assuming that when a condominium corporation gets condominiumized or they register their corporation, perhaps the corporate corporation registry section could…maybe that is already too late because you are incorporating a corporation. Maybe I should just ask the Minister this question and not try to answer it.

What steps could we take to let the potential people who are interested in condominiumizing or getting into this ownership to be aware of all the things they need to do? After all, you could pass the legislation, but we want to make sure that everybody is aware of this and they act accordingly so that they do not fall through the cracks that they did when they didn’t have this kind of protection. Thank you.

Thank you, Ms. Lee. Minister Bell.

Madam Chair, it is a good suggestion. We do have this information and we do disseminate it to realtors currently, to lawyers, to those existing condominium corporations. Unfortunately, we obviously don’t know who is intending to convert to condominium, so it is difficult for us to know. But we make the information available and also people who are interested and need more information, if they can’t find it there, they can always come to the Department of Justice. I think it is pretty widely disseminated already. Thank you.

Thank you, Minister Bell. Ms. Lee.

Thank you, Madam Chair. Just a final follow-up to that. I know that although we didn’t have a lot of people coming before us in the committee, this initiative has gone through public consultation in at least three communities. I have had lots of people come up and tell me that they would like to see this legislation passed as soon as possible. We do work here, but not everybody knows what we are doing here on a daily basis. I would like to ask the Minister if he would commit to doing some sort of public awareness, not a campaign but just a public service announcement, maybe a little 30-30 in newspapers -- the 30-30s are little ads in the paper -- just to let people know that such laws exist and that people should be aware of that just as a consumer awareness initiative. Thank you.

Thank you, Ms. Lee. Mr. Bell.

Madam Chair, there is regulation development work that has to happen here once the legislation is passed. In order to do that, we will be sitting down with the condo corporations themselves. We do have a list of stakeholders, a distribution list that we communicate with. I have indicated some of those who are on that list. We will make sure that they have this information and we get it out to them. Thank you.

Thank you, Mr. Bell. Are there any further general comments? Okay. Does the committee agree that we will proceed with the clause-by-clause review of the bill?

Agreed.

Thank you. Bill 2, An Act to Amend the Condominium Act. Clause 1.

Agreed.