Am I being scammed? (re-stated)

D.J. writes:

Dear Paul:

I just realized that according to our Declaration I should be paying a percentage share  of common element expenses, but I am being charged more than this amount. Am I being scammed?

Paul replies:

Dear D.J.:

If you are paying more that the percentage share as outlined in the Declaration, then that is not correct. I would not say you are being scammed, this may be a simple case of someone not understanding the legal requirements as outlined in the Condominium Act of Manitoba.

According to section 139 (1)

Assessing and collecting contributions to common expenses

139(1)      A condominium corporation must assess and collect the unit owners’ contributions to the common expenses in accordance with this Act and the corporation’s declaration and by-laws.

Contribution to common expenses

139(2)      For the purpose of subsection (1), the condominium corporation must, for each fiscal year,

   (a) determine the amount required for the common expenses fund; and

   (b) determine the contribution of each unit owner by apportioning the required amount among the unit owners in the     proportions specified in the declaration.

Every year your condo board strikes a budget based on the best estimates of what the expenses will be in the coming year and distributes the costs among the unit owners in accordance with the percentage as outlined in the Declaration.  

Since the budget should be balanced (revenue equals expenses) your condo fees should be set accordingly.  In this way, there should not be any deficit or surplus at the end of the year unless estimates were wrong, costs increased, or a savings was realized. A condo corporation could decide to run a surplus or a deficit. Being over budget may meet with owner resistance in having to pay more than necessary while a running a deficit places the organization in debt.

The section 141 (5) of the Condominium Act requires that once the Declarant requires a unit owner to pay common element fees on a unit the Declarant must pay fees on all unsold units until it is occupied by a new owner.

Contributions to common expenses by declarant

141(5)      Once unit owners are required to contribute to the common expenses of a condominium corporation, the declarant must also contribute to the common expenses in respect of the units that he or she owns unless otherwise provided for in the regulations

You need to check your Declaration and understand why you are paying more than your percentage share. Good Luck.

This Post Has One Comment

  1. Jim stuparyk

    Hi Paul
    Why is the Canadian condo inst.and big nAme lawyers so afraid to tackle the unfair tax percentage rate where condos are taxed at same rate as single dwellings?
    Yet so eager to have condo documents that virtually no one reads redone at big dollars to melt with the new condo act which again almost no one reads.
    This is the elephant on the elephant and the big clean legal ripoff.
    I hAve every respect for legal but condos are sitting ducks for this these cash grabs.

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