Strata Documents and Minutes

Is strata right for me? This is a personal question and each strata is different. When you are buying into a strata you are buying into a community and you should carefully read through the Form B package, the rules, minutes, and bylaws to ensure that who your are matches the “personality” of the community. When in doubt don’t be afraid to call the strata council president.

The Strata Form B is a large stack of documents, should I get a lawyer to review? Most of these documents are strata rule and minute and are not written by lawyers, they are written by your strata council and should be easy to understand. Unfortunately legal review of these minute is not as effective as a your own personal review as it is most important that you (and not your lawyer) feel comfortable with the way the community if being run. This being said, I always encourage my clients to, after reading the minutes, give me a call when any specific items of concern they may wish to discuss.

What are some red flag in the strata Form B package and minutes? Things to watch out for include: discussion of future repairs, reoccurring problems and disputes, and dysfunctional or disinterested councils.

What is a property depreciation report and how can I tell if a strata contingency fund is “fully funded”? Each strata is required to commission a property depreciation report every three years. This report sets out models which detail how the building will require maintenance and upkeep over the next few decades and can assist in foreseeing the likelihood of special assessments. Each depreciation report sets out three funding models and by comparing the current state of the contingency reserve and the monthly CRF contribution to these models you can determine how closely the strata is following the reports recommendations.

Written by Kelowna Real Estate Lawyer Peter Borszcz.

Do I Need a Power of Attorney?

Here in Kelowna there are several reasons an individual may require a Power of Attorney (POA) when preparing to sell his or her property. A Power of Attorney is a legal documents that grants to a person (sometimes called the “Attorney”) the right to sell and dispose of the assets of the Donor (the person granting the power of attorney). Although there are many circumstances where a Power of Attorney can be useful, some of the most common situations are:

  1. families where spouses are working overseas/ out of town (including military duty)
  2. adult caregivers of elderly persons needing to manage their everyday financial and property affairs
  3. real estate agents who act under the terms of a specific and limited Power of Attorney to complete a real estate deal (for example when their clients are on vacation)

When the time comes to transfer land using a POA, a lawyer is going to be looking for certain criteria in order to establish the validity of the POA.

  1. ascertaining the true identity of the parties involved;
  2. make inquiries to ensure the POA has not been revoked;
  3. ensuring that the ORIGINAL must be filed with the Land Title Office with a DF#;
  4. ensuring that the POA was properly witnessed by an OFFICER under s.42(3) of the Land Title Act;
  5. ensuring the POA has sufficient powers to transfer land; and,
  6. ensuring that the attorney must be at least 19 yrs old.

The flexibility of allowing another person to make financial and legal decisions for someone else can make Power of Attorney a useful tool in real estate transactions. Contact to find out more.

June Kelowna Real Estate Closings: Municipal Property Tax Adjusments

The end of June is “high season” for residential real estate closing. As the school year comes to the close and the weather turns warmer, people want to get the “business of moving” done prior to enjoying summer holidays.

There are a couple of unique considerations for Kelowna Real Estate at this time of year, all of which revolve around the July 2 Municipal Property Tax payment deadline.


  1. For closings before June – the municipal property tax payment is the responsibility of the new Buyer and the Seller receives a debit at closing based on the estimated bill to be paid (or the assessment if available).
  2. For closing after early July  – the municipal property tax payment is the responsibility of the Seller (prior to vacating) and Buyer will receive a debit at closing for the amount already paid.

For closings in June and early July, a couple of key points for Sellers:

  1. When you pay your property taxes (at a bank or at the city), ensure that you keep your receipt.
  2. For your principal residence, make sure that you claim your Home Owners Grant on your principal residence when you pay your taxes (more info on eligibility here)
  3. Depending on the municipality and the timing of the payment, Sellers closing at the end of June may be legally required to holdback an amount of closing to ensure that property taxes have been paid (ensure you have budgeted for this extra temporary cost).

Your Kelowna Real Estate Lawyer will make adjustments such that the Buyer and Seller each “pay” for those expenses which accrue to the property during that time of the year (a per diem adjustment) that each party owns the property being transferred.

The Home Owners Grant that is actually claimed is the amount adjusted for. This can result in some “inequity” in some cases. For example where the Buyer is a Senior buys a property from an Investor and the Seller has already paid the property tax the difference in Home Owner Grant amounts means the Senior may pay an extra $500 in property tax.

These situations may not be entirely avoided but in some cases they can be minimized by talking to your Kelowna Real Estate Lawyer early. For instance (in the example above), we would try to have the Senior Buyer pay the taxes and claim the grant (and debit the Investor Seller) if this was legally possible prior to the municipal tax deadline.

For more information on property taxes, see the local municipal property tax information pages here:

  1. For information on Kelowna Property Taxes – click here.
  2. For information on West Kelowna Property Taxes – click here.
  3. For information on Lake Country Property Taxes – click here.

Written by Kelowna Real Estate Lawyer Peter Borszcz.



When should you call a Real Estate Lawyer?

In the context of residential real estate, 90% of the time the deals of fairly straightforward. The difficulty here is identifying the 10% of homes or deals that have issues and importantly what those issues are.

Prior to subject removal Home Buyers are in the best position to gather information and make decisions about their home. This often involves: bankers, home inspectors, city clerks, and yes, LAWYERS.

In short: Calling a lawyer BEFORE subject removal provides the BEST value for clients.

Buyers are always concerned with fees (see my fee post here), so often they are hesitant to contact a lawyer before they purchase a home and Lawyers have earned an unfortunate reputation of “clocking” the very first phone call with a client.

There are lots of law firms in town… so whats different about Pihl Law Corporation?

  1. Buyers who are referred by our Referring Realtors get connected directly with Peter, usually immediately if he is available;
  2. If Peter is meeting with clients, all Referred Buyers have their email or telephone call returned within a few hours;
  3. Referred Buyers are never billed for that initial phone call (yes its FREE, the timer is off), even if they don’t proceed to purchase that home.
  4. The following key points are discussed in detail:
    1. Review of any apparent legal issues based on the home, the neighborhood and our local knowledge;
    2. The binding nature of the contract after subject removal;
    3. The importance of due diligence and home inspection and strata document review;
    4. A brief overview of the land titles and a discussion about whether an full title review is warranted on a case by case basis;
    5. A discussion about what legal services are required for each deal and what the costs may be (our firm quote follows by email); and,
    6. Instructions on next steps as the closing date nears;

If you have a client that has questions, direct them to call us (250-762-5434), and importantly… ensure they know your referral gets them “in the front door” [pun intended :)].

By Kelowna Real Estate Lawyer Peter Borszcz


Buying Kelowna Real Estate in a Sellers Market

In the Central Okanagan Real Estate zone this December, new listings decreased 11% and unit sales increased 33% compared with this time last year (stats here). This has been a relatively consistent trend over the Fall and Winter of 2013 with inventory dropping and sales increasing. This trend shows our real estate market “re-balancing” after years of stagnation and suggests that we are moving toward a Sellers market.

Given that Buyers have “ruled the roost” for so long I thought I was important to revisit some important things for Buyers to remember as the market momentum picks up:

  • Get pre-qualified, talk to your Mortgage Broker first to lock in a rate, and know what you can comfortably afford. Interest rates will rise; an early rate hold in a fast rising market can save a Buyer hundreds of dollars on a monthly mortgage payment.
  • Negotiations will have a sense of urgency in a Sellers Market, so do all your homework first (before you start viewing any homes in person):
  • Get your REALTOR to start a “Activity Alert” for you for all relevant listings in your top neighborhoods – this will give you a sense of what the homes are selling for and how fast they are selling;
  • Have sufficient funds in the bank for down payment, moving and closing costs (ideally about 9-14% of your intended purchase price being 5-10% down on the home, plus 2% estimated moving and 2% estimated closing costs)


  • Negotiate on price, but leave sufficient time for due diligence;
    • Due Diligence is the process of “kicking the tires” on a residential property and looking at the quality and suitability of premises. No matter how intense the negotiations are, Buyers should always leave time and have subject conditions in place to:

i.     Finalize a Mortgage Commitment;

ii.     Do a Home Inspection;

iii.     Review the Land Title with a Lawyer;

iv.     Review the Strata Documentation (if applicable);

  • Many negotiations will be competitive, and a good, experienced REALTOR makes all the difference here, but remember:
    1. It’s okay to “lose” on a house if you are not 100% comfortable with the deal, “winning” a competitive bid is not like winning the hockey game, its “winning” the right to pay for an asset for the next 25 years of your life.
    2. Its way easier to find another good house than it is to find a good spouse… yes I am serious… there are lots of good houses, there are lots of good neighborhoods, seldom is there only “one house”.
  • Final point: Don’t assume the good times will last forever. Lots of people learned this lesson the hard way in 2008 buying pre-sale contracts they could not afford. Real estate is not considered to be a “liquid asset” and you cannot simple sell it with a click of a button. If you sign a real estate contract, plan and expect to close the deal.

Written by Kelowna Real Estate Lawyer Peter Borszcz


Strata Depreciation Reports in Kelowna Real Estate.

Under the Strata Property Act, a Contingency Reserve Fund (CRF) is established to pay for extraordinary expenses, but under the Act, the amount in the CRF was established by a formula (which had NO relationship  to the age of the building!) Furthermore, the amount of contribution to the CRF was CAPPED, unless an ¾ vote was obtained to had additional contributions (hard to plan for the future).

There were amendments to the Strata Property Act in 2009 for stratas to commission Strata Depreciation Reports on the policy basis that long term planning and maintenance will prolong the lifecycle of building systems and reduce premature failure.

Now in British Columbia, Strata Corporations (with 5 or more units) are required to commission a Strata Depreciation Report by DEC 13, 2013 or to pass a s.94(3) resolution (with ¾ vote) for an 18 month exemption to this new legislated requirement. Importantly, this does not create a “separate fund” for repairs, but educates the strata council if their current contingency fund is “in line” with expect future costs. Strata Councils are required to update reports every three years

A Strata Depreciation Report includes:

  1.  Physical Inventory of Assets
  2. Evaluation based on on-site Inspection
  3. Repair, Renewal and Maintenance Costs for a 30 year plan
  4. Assumptions
  5. Three Year Cash Flow Models

Reports Are a MANDATORY attachment to the Strata Form B  with Kelowna Home Buyers receive from their Realtor.

This Form B now must also include:

  • The rules of the strata corporation;
  • The current budget of the strata corporation;
  •  Any rental disclosure statement;
  • Current strata depreciation report
  • Parking Stall and Storage Locker information;

When reviewing the Strata Depreciation Report, Kelowna Home Buyers should ask:

  1. Is the Form B complete (containing current Rules, Budget, Rental Disclosure, and Depreciation Report)
  2. Does the Buyer understand the Report?
  3. Has the strata deferred its Report obligations under s.94(3)?
  4. Does the financial forecast in the Report and the strata budget align?
  5. Should anything in the Report be reflected in the Purchase Price when analyzing comparators?

Presentation Slides: Depreciation Reports Presentation (OCT 2013)

Written by Kelowna Real Estate Lawyer Peter Borszcz.