Condo boards can be frustrated when they want to upgrade a replacement fence, driveway or roof, but are advised by their property manager and/or lawyer that they may only replace it with exactly what existed before. This is an overly strict interpretation of Alberta condo law, and one that can be taken too far.
One example of this caution would be a townhouse condo development with extensive spruce wooden fencing that's in need of replacement. The Board wants a switch (upgrade?) to white vinyl fencing that costs something more than replacement wood fencing. There's money in the reserve account for the project, but the property manager calls a halt, cautioning that condo boards may only "replace like with like", and to spend more would be a "capital improvement" requiring a 75% in-favour vote by owners. A lawyer is consulted, and he confirms this narrow interpretation of the law.
While I can read section 38 of Alberta's Condominium Property Act as well as the manager and the lawyer, I differ on the interpretation of "capital improvement". To me the choice in this example falls within the degree of discretion extended to well-intentioned condo boards doing their job to run their little communities and to get things done. Obtaining a 75% vote from owners can be time consuming and impractical for a variety of reasons, including absentee owners who simply don't care and don't respond; yet their abstentions are counted as votes against.
As well, this isn't lawsuit-happy America. How many condo property owners will challenge their board for replacing wooden fences (as an example) with better-quality vinyl fences? If they did, would a judge order removal of the new fences, or otherwise sanction the condo board for its best efforts to maintain the common property? From the judgments that I've read, the courts are VERY cautious about telling condominiums how to run their affairs. If a board's action is at all reasonable in the circumstances, it stands.
Perhaps we should seek a little less legal advice, and let common sense prevail. Yes, if you have no fences, and want to create fencing between townhomes, then obtain the 75% approval before spending the money. But if it's a quality replacement, the job just needs to get done. If your property manager remains concerned, he or she can issue the Board a letter declaring their caution and absolving the management firm of any liability.
If you need to be more creative, fund the "same-as" replacement from the Reserve Fund, but take the additional funds to pay for the better quality from your on-hand cash. If necessary, you might even skip a payment to the Reserve Fund to leave enough operating funds to do that. The Section 38 restriction on "capital improvements" addresses reserve money, not operating funds. Be cautious in this area, but you can see how a well-intentioned condo board can be imaginative, take the initiative, and get the job done for themselves and their neighbours.
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