condo managers

Proposed reg details code of ethics for condo managers

Tuesday, September 5, 2017

A code of ethics for condo managers is now up for public comment after Ontario’s Ministry of Government and Consumer Services last week released more proposed regulations under the Condominium Management Services Act. The new legislation, which comes as part of sweeping condo law reforms aimed at improving consumer protection, will see condo managers and condo management providers regulated and subjected to licensing requirements due to take effect Nov. 1.

The latest round of rules proposed under the Condominium Management Services Act are intended to take effect Feb. 1, 2018. They detail contemplated procedures for addressing complaints about license holders; requirements for condo managers and condo management providers to disclose certain information to prospective clients before entering contracts, and to maintain specific kinds of insurance; as well as duties relating to client records and licensee supervision.

The proposed code of ethics for condo managers sets out obligations that include acting in the best interests of clients, demonstrating competence, fairness, financial responsibility, integrity and professionalism. The code would also forbid condo managers from misrepresenting their license and from providing advice or opinions in areas where they lack the expertise to do so.

The proposed regulations would further forbid licensees from obstructing complaints or the supply of information about a potential breach of the Condominium Management Services Act to parties including the board of a condo corporation and the condo management provider.

A registrar would have a range of remedies available under the legislation for responding to complaints about licensees, including issuing a warning, revoking or suspending a license, and referring the matter to a discipline committee. The registrar would be required to notify the licensee in question — as well as the board of directors of the client condo corporation or principal condo manager, depending on the circumstances — of certain actions taken in response to complaints.

The registrar would have two years after learning of a complaint to refer the matter to the discipline committee, which would be made up of at least five members to be appointed by the board of the administrative authority. A minimum of three committee members would be assigned to preside over a hearing, including no fewer than two licensees or officers or directors of a licensed condo management provider and at least one person who has never been a licensee or associated with a currently or previously licensed condo management provider as a director, officer, employee or shareholder.

The discipline committee would be required to give 45 days’ notice to parties to the proceeding, who would include the administrative authority, the licensee in question and anyone else the committee sees fit to add. The administrative authority would be required to disclose to the other parties any evidence it plans to submit 30 days before the hearing begins, while other parties would be required to do the same 15 days before the hearing begins.

The discipline committee would have the authority to prohibit evidence and submissions made at closed hearings from being disclosed to the public. However, the committee would be obligated to provide the person who made the complaint with a copy of the final decision or order if he or she is not a party to the proceeding.

Parties to the proceeding would have 30 days to appeal from when the discipline committee sends a copy of its final decision or order. An appeals committee would operate similarly to the discipline committee, except that none of the members who sat on the panel assigned to the discipline committee hearing could sit on the panel assigned to the appeal committee hearing.

The proposed regulation also calls for licensees to disclose certain information in writing to prospective clients before signing agreements. This information would range from services to be provided under the contract, along with their cost, to declarations of material interests in other businesses that may approach that same client about engaging their services, if the licensee has any.

Condo management providers would also have to disclose information about their insurance policies to prospective clients before signing agreements and notify existing clients within 30 days of material changes to or the cancellation or termination of their insurance. Under the proposed regulation, providers would be required to maintain errors and omissions insurance as well as fidelity insurance.

The proposed regulation would further make condo management providers responsible for the “adequate” supervision of the limited licensees it employs. The proposed regulation would also require that license holders accurately and securely maintain client records, which would have to be transferred or made available for inspection “as soon as reasonably possible” upon request by the client.

The Ministry of Government and Consumer Services said it will accept feedback on the proposed regulations until Oct. 16.

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