In a recent case, Friedich v. MTCC No. 1018,
a condominium resident unsuccessfully sued the condo corporation after his
vehicle had been vandalized.
The corporation had made
changes to its security for the garage. The previous telephone entry system was
replaced by closed circuit televisions and security guard patrols every two
hours.
The resident alleged that the
changes to garage security resulted in easy access to vandals. He argued that
the corporation had breached its obligation contained in section 17 of the
Condominium Act, 1998, to control, manage and administer the common elements
and was also negligent under the Occupiers’ Liability Act in failing to keep
the parking garage secure.
The resident’s case was
dismissed after the Court concluded that the resident did not provide any
evidence that the change in the garage security made it more likely that his
car would be vandalized or that the corporation’s security protocol fell below industry
standards. The resident did not even provide any evidence to substantiate that
his car had been vandalized while in the parking garage.
The Court stated that the
corporation was not an insurer and determined that if there was any vandalism
that occurred to the resident’s vehicle while in the garage, the damage was
caused by criminals, not the condominium corporation. The Court found that the
corporation had acted reasonably in hiring the security firm and that there was
no evidence that the security firm did not discharge its duties in a
professional and reputable manner.
The Court
decision was upheld on appeal to the Superior Court of Justice.
The dismissal of the appeal was based on the fact that the resident failed to
establish that the corporation had breached the standard of care required under
the Occupiers’ Liability Act.
The Superior Court also
acknowledged that the Board’s business judgment concerning the security system
was entitled to deference. The Ontario Court of Appeal has recognized that the
“business judgment rule” applies to condominium board decisions. As long as the
board of directors has acted honestly and in good faith and exercised the care,
diligence and skill that a reasonably prudent person would exercise in
comparable circumstances, the courts will give deference to board decisions.
Directors who have met the requisite standard of care won’t have to worry about
the court “second-guessing” board decisions.
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