CONDOMINIUM DOCUMENTS

        When buying a Condominium, there are more matters that need to be considered than when buying a single family home.  Most of these arise mainly from the fact that you involved in real estate with a group.  These matters are mainly focused around matters of the finances and governance of the Condominium Project.

        Many of the Terms set out herein are more fully explained at Condominium Terms.

PLEASE NOTE - GREEN MEANS THIS INFORMATION IS STILL COMING AND UNDER DEVELOPMENT - SHOULD BE SOON!

        A review of the "Condo Docs" is necessary to fully understand what exactly you are purchasing.  Following are the main documents that you should review or have reviewed for you and which you need to understand:

• OPERATING BUDGET (current fiscal year):
  
  The Operating Budget will set out the expected Income and Expenses for the Condominium Corporation (CC) for the current fiscal year and will set out the expected surplus.  If you see an expected deficient, you can expect to be asked for more money.  (Example of an Operating Budget)
• CONDOMINIUM FEE SCHEDULE:
  
  The Condominium Fee is a payment you generally make monthly to the CC as your share of the Income of the CC and is used towards the Expenses of the CC and generally towards building a surplus. You will want to know what your monthly "Condo Fee" will be and what is included in that fee.  For instance if heat, water/sewer and electricity are included in the Condo Fee, then you won't have to pay those out of your personal budget.  If they are not included, you need to those of these additional expenses to you.  (Example of a Condominium Fee Schedule)
• CURRENT FINANCIAL STATEMENT:
  
  You need to see the Financial Statements which will include a Balance Sheet.  You are usually given the last annual financial statements of the CC which may be quite out of date.  You should try to obtain the most current available monthly financial information for the reality may have changed significantly from when the annual financial statements were last prepared. Of importance is the amount of money in the Reserve Fund which will be available for upcoming repairs.  If it is low or non existent, you can expect to be paying increased Condo Fees or be faced with a Special Levy or Assessment.  (Example of Condominium Financial Statements)
• RESERVE FUND STUDY:
  
  The Reserve Fund Study (RFS) is a very important document as it is an independent study setting out the physical condition of the Condominium Project, when the next big expenditures are planned for, such as a new roof and whether the CC has been building up a Reserve Fund to pay for these expenditures.  A review of the Financial Statements compared to the RFS will determine if the CC is on pace to be able to fund these major expenditures.  (Example of a Reserve Fund Study)
• CONDOMINIUM BY-LAWS:
  
  This document is very important as it sets out the rules and regulations by which the CC is governed as well as the rules by which all the Owners must life by.  You need to know what you are allowed and not allowed to do.  For instance, the Condominium Project may be aged restricted to persons over the age of 50 or there may be a ban on having pets or in leasing out your Unit.  Only the By-laws registered with the Land Title Office are enforceable so ensure you are reviewing registered By-Laws.  Click Here to read more about Condominium By-Laws.
• ANNUAL GENERAL MEETING MINUTES:
  
  A review of the minutes from the last meeting of all Owners will give you an idea of what issues have been important to the CC and perhaps what is being done about them.  If there is something out of the ordinary, it will generally be contained in the AGM Minutes. (Example of Annual General Meeting Minutes)
• BOARD MEETING MINUTES:
  
  The Board of Directors are the representatives of the Owners who govern the CC on behalf of all of the Owners.  Their election and how they operate is set out in the By-Laws.  A review of several of their recent minutes will give you some idea of the current issues affecting the CC.  (Example of Board Meeting Minutes)
• INSURANCE CERTIFICATE:
  
  A review of the current Insurance Certificate will show the coverage the CC has for the CP and what the deductibles are.  If there is damage, the Owners will have to pay the deductible which may result in a Special Levy.  Please note that this insurance covers the CC and its property, it does not cover your contents within your Unit, which must be separately insured by you. (Example Insurance Certificate)
• MANAGEMENT CONTRACT:
  
  A Management Company is generally retained by the CC to provide various services to the CP, such as ground maintenance, snow clearing and repairs.  They also manage the collection of Condo Fees and other operational aspects of the CC.  You should know what services the Management Company is providing and whether there are extra charges for some of their services.  (Example Management Contract)
• CONDOMINIUM PLAN:
  
  The Condominium Plan shows where the boundaries are between an Owner's Unit and the Common Property or another Owner's Unit.  It can also indicate whether Parking Stalls and Lockers are titled or Common Property.  (Example of a Condominium Plan)

     IN ADDITION, in any purchase of a Condominium, we would obtain a copy of an Estoppel Certificate, Information Statement and Insurance Binder.

• ESTOPPEL CERTIFICATE:
  
  The Estoppel Certificate is a document issued and certified by the CC as to very specific information pursuant to Section 39(6) of the Condominium Property Act (Section 39(6)) A Buyer needs to know this information such as what the Condo Fees are, how they are assessed and whether they have been paid or not and where they are paid to.  (Example of an Estoppel Certificate)
• INFORMATION STATEMENT:
  
  The Information Statement is another document issued by the CC as to certain information pursuant to Section 44 of the Condominium Property Act (Section 44). This also provides valuable insight to the financial health of the CC and how well it has been administered. (Example of an Information Statement)
• INSURANCE BINDER:
  
  A copy of the Insurance Binder would be obtained to confirm that the proper Corporation insurance is in place and what its specifics are.  (Example of an Insurance Binder)
  
   

PLEASE NOTE:   Some of the materials for this web page are from an article by and are used with the permission of Phyllis Fyckes, President of Condo Diagnostics, A Division of The Document People Ltd., a company that specializes in the review of Condominium Documents. Condo Diagnostics