BYL02 - Bylaws: Why they Matter to Board Members
My time on
several Condo Boards has lead me to a sad truth: If you ever want to lose faith
in humanity, go join a Condo Board for year.
I think I used to have this naive belief that on the whole, 90% of
people in our society would do “the right things” in a communal setting.
The sad reality is that that percentage I just listed is probably right. What I never quite expected was just how wrong and incredibly inept the last 10% could be, and the jarring impact that they have on the remaining 90%. The One and Only Stick You’ve Got To a Condo Board, bylaws are the single most important factor in enabling a Board to ensure the building is run in an orderly, secure, fair, and financially sound fashion. Typically, the “rules” of a condo themselves are set within the bylaws, and standards are also set for things like pets, or hours of noise, or saving for future repairs. Strong bylaws will try and anticipate the major risks of the day. Weak ones will be silent on the issues that have a significant negative impact. Without a strong set of bylaws, a Board is legally powerless to enforce these rules, as bylaws typically clearly state and grant the Board the ability to punish those that break the rules, typically through fines and other financial penalties. Imagine the police trying to keep order without a set of laws to define what’s wrong or right…or refs at an NHL game without a rule book to define what constitutes a penalty and thus making up their own rules (ok bad example… they seem to do that anyways…) When enforcing the bylaws, Boards must be consistent in doing this across all owners, not just certain individuals. If not, legal challenges may be successful in overturning the validity of these fines. Update Your Bylaws Periodically Bylaws must be kept up to date and address evolving threats and changes to legislation. For example, ExpressVu mini satellite dishes were a big issue in the early 2000’s . Buildings without specific bylaws against them found these dishes popping up all over the exterior like dandelions. Owners tried clever ways to skirt bylaws against “fixed” dishes by using tripods and other MacGyver-esque non permanent techniques. Legislation changes over time, mandating that Condo Corporations address certain issues – issues that should be added to the existing bylaws. For example - in recent times, Condominium Acts in various Provinces have made reserve fund studies mandatory – what you would want to see is that the “Duties and Obligations” section of the bylaws are modified so that the Board is required to establish and maintain a Reserve Fund. Updating Bylaws – One Little Hitch Now that I’ve convinced you that updating your bylaws is a great idea, there exists a mechanism in most bylaws that will make this a feat slightly harder to do than achieving World Peace. Most bylaws will state that a certain percentage of unit factors must “vote” yes to change the bylaws. Just like real world politics, in theory this protects against an overzealous Board from making changes that don’t reflect the will of the owners. Just like in real life politics, it also means that changing the status quo will be difficult! My recommendation to Boards – don’t let the controversial issues derail progress on other important issues. While it may be tempting to update all your bylaws at once – primarily due to legal costs in drafting changes – you’ll make better progress if you deal with the less controversial elements first, and then deal with the “hot button” issues separately and individually. For example, pet bylaws are usually guaranteed to be a bitterly contested and close vote, while you may it easier to get changes passed to your “Duties and Obligations” of the Corporation. Alternatively, you may want to propose changes to your bylaws as separate and independent amendments, and have owners vote separately on each issue (at the same vote) vs lumping it into a single document which is subject to a single vote. Consult with your legal counsel as to what’s possible. ~CondoSensei |
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