Auditor General’s Report on the Ontario Condominium Industry

In December 2020, James Davidson reported on the Ontario Auditor General’s critique of the condominium industry, highlighting significant gaps in protecting condo owners and boards. The key criticisms include the failure to enforce legislative amendments to the Condominium Act, leading to insufficient reserve fund contributions by many condo corporations and developers. The Condominium Authority of Ontario (CAO) and the Condominium Management Regulatory Authority of Ontario (CMRAO) were urged to enhance their investigative and enforcement efforts due to the prevalence of unlicensed managers and incomplete mandatory director training.

The Auditor General also criticized the narrow jurisdiction and procedural unfairness of the Condominium Authority Tribunal (CAT), suggesting an expansion of its jurisdiction and measures to ensure equitable legal representation. Public access to information about condo corporations and directors was deemed insufficient, hindering transparency.

The recommendations included enforcing pending legislative amendments, imposing stricter first-year reserve fund planning on developers, and enhancing CAO and CMRAO’s responsibilities and enforcement powers. Additionally, expanding CAT’s jurisdiction to cover more disputes and improving record-keeping obligations of condo corporations were emphasized. A suggestion to merge CAO and CMRAO into a single regulatory body was also proposed.

Davidson acknowledges these criticisms and recommendations but notes significant progress in the last five years. He supports the push for consumer protection but emphasizes the need to recognize and support the efforts of volunteer condo board members and professional property managers, whose contributions are crucial for the effective functioning of condominium communities.