Can an Alberta Condo Board Charge a Special Assessment?

A notice for a special assessment, which the Condominium Property Act calls a special levy, can be a shock. Owners often wonder whether the board can really do this without a vote.

This article explains in general terms when a board can levy one, what approval is needed, what the notice should tell you and what you can do if you disagree.

This article covers the law of Alberta.

When a board can levy a special assessment

The Act lists the purposes a special levy may fund:

• Unexpected and urgent maintenance, repair or replacement.
• Operating shortfalls.
• Increasing the reserve fund balance to meet the reserve fund plan.
• Capital improvements.
• Satisfying a judgment against the corporation.

The corporation must establish and maintain a reserve fund reasonably sufficient to provide for major repairs and replacement of its property, common property and managed property. It must also keep the fund in a separate bank account and give owners an annual reserve fund report with the AGM package.

The corporation must retain a reserve fund study provider, and the first study is due no later than 2 years after the condominium plan is registered. The study must be repeated on or before 5 years from the day the most recent reserve fund plan was approved. After receiving the report, the board must approve a reserve fund plan setting the funding method and amounts, and owners must get a copy before funds are collected under it.

Alberta.ca notes that a reserve fund that is not adequately maintained may force the board to levy special assessments.

What approval is needed

The board may determine contributions to be levied by resolution, including a special levy, and an owner vote at a general meeting is generally not needed.

There is an exception. If the special levy is for a capital improvement, a special resolution of the owners is required first. Also, reserve fund money may not be used for capital improvements unless removal is authorized by special resolution (or necessary for compliance) and sufficient funds remain.

The corporation is responsible for enforcing its bylaws and for the control, management and administration of its property. Owners and anyone in possession of a unit are bound by the bylaws. If a bylaw conflicts with the Act or the Regulation, the Act or Regulation prevails to the extent of the conflict.

What the notice must tell you

As soon as possible after approving a special levy, the board must inform each owner of its purpose, the total amount, how each unit's share was calculated, the owner's amount and the payment dates. Any unused funds go to the reserve fund.

Compare your notice against that list. If something is missing or unclear, you can raise it with the board. Because the notice must show how each unit's share was calculated, check that explanation against your own amount. If the calculation still does not make sense, how it applies depends on your situation, so it is worth confirming with a lawyer.

These document rights are separate from the levy notice itself, but they can help you test whether the notice adds up. If you make a written request, the corporation must provide prescribed documents, such as the budget, annual financial statements, meeting minutes and reserve fund plans, within 10 days after receiving it. A corporation may charge fees only where authorized by regulation and in the prescribed amount. For other requested documents the cap is $10, or $0.25 per page where the document is in hard copy and exceeds 40 pages. A rush surcharge of up to $20 may be charged when they are produced within 3 days.

If you are buying a unit, the information statement covers pending or unsatisfied actions and judgments, reserve fund and contribution amounts, structural deficiencies and loans, which makes it useful for spotting red flags. Its maximum fee is $100.

If you disagree with the levy

An owner who disagrees can raise it with the board, and Alberta.ca points to the resolving-condominium-disputes process. The Court can also remedy improper conduct, meaning non-compliance with the Act, regulations or bylaws, or oppressive or unfairly prejudicial conduct of the corporation's affairs.

The two routes are linked, and the timing matters. No Tribunal application can be filed if a Court action has started on the same dispute, and no Court action may start once a Tribunal hearing has concluded. Tribunal decisions are binding, with a 30-day window to appeal or file for judicial review after receiving a decision. The Tribunal can also award costs.

How these routes apply to your levy depends on your situation, so it is worth confirming with a lawyer before you decide.

What to do next

• Read the levy notice and check that it covers purpose, total, calculation, your amount and dates.
• Ask for the board's resolution and, for a capital improvement, the special resolution.
• Request the minutes, budget, financial statements and reserve fund plans. The corporation must respond within 10 days of a written request.
• Check whether the purpose fits the list in the Act.
• Raise concerns with the board in writing, and get legal advice before choosing the Tribunal or Court, since choosing one can close off the other.

Frequently asked questions