In tort law, a finding of liability typically requires a finding of fault. The Divisional Court has recently confirmed that when it comes to a unit owner’s liability under s. 105 of the Condominium Act, no finding of fault is required.

Many condominium corporations have large insurance deductibles for property damage claims.  Section 105(1) and (2) of the Condominium Act allows a condominium corporation to pass the risk of amounts within the deductible on to unit owners.  Section 105(3) of the Condominium Act further permits a condominium corporation to pass a by-law extending the circumstances whereby a unit owner may be liable.

In the recent decision of Lozano v. TSCC 1765, 2021 ONSC 983, a leak had emanated from the Lozanos’ toilet, ultimately causing damage to the common elements.  At the time, the Lozanos were on a several-month trip to the Philippines, and were having a friend check their unit every two weeks.  The condominium corporation charged the damage back to the Lozanos under s. 105 of the Condominium Act and the by-law which had been passed by the corporation.

The by-laws of TSCC 1761 stated that owners would be responsible for damage to other units and the common elements in the event an owner or person residing in the owner’s unit caused the damage through an act or omission.  The Divisional Court confirmed that this “act or omission” does not require a finding of negligent behavior:

s. 105 represents a policy decision made by the Legislature to place the burden of paying the insurance deductible on the person (unit owner) that caused the loss, without consideration of whether that unit owner’s actions were negligent or otherwise.

Despite no requirement of negligence, the Divisional Court still confirmed that there was a requirement for an “act or omission” which caused the loss both in fact and in law.

The original application judge was satisfied that the Lozanos’ failure to hire a plumber to inspect the toilet would qualify as an “act or omission”, as was the Lozanos’ prolonged absence from their unit without shutting off their water.

The Divisional Court only agreed in part.  The Divisional Court expressed significant reservations as to whether the failure to hire a plumber would qualify as an “act or omission” in law, but was satisfied that the Lozanos’ prolonged absence qualified.

Closing Thoughts

If a by-law has been passed which makes owners responsible for damage to other units and the common elements resulting from an “act or omission”, then a condominium corporation must show that the loss was caused by an “act or omission”.  The question of what will qualify as an act or omission remains open to interpretation and debate.  What is clear is that no finding of negligence on the part of the unit owner is required, and it is no defence for a unit owner to say that they took all reasonable care to prevent the damage.