Condo Law Digest – March 2017

Caterpillar 345B excavator & 740 dumper, 29 January 2009.jpgNiagara North Condominium Corporation No. 6 v Temideo, 2017 ONSC 897
Decision Date: February 7, 2017
http://canlii.ca/t/gxch8

The defendant owns a condominium in NNCC No. 6 that is rented to Kimberly Watson and her adult son Robert James. James, the grandson of the defendant, suffers from health issues which make it impossible for him to live on his own. In the spring of 2013 the unit below the defendant’s was rented to a new tenant. Both the new tenant and Ms. Watson complained to the property manager about excessive noise coming from the other’s unit. In this action NNCC No. 6 seeks an order that Ms. Watson move out of the unit or refrain from making excessive noise.

Based on the evidence provided to him, Justice Taylor found that Ms. Watson made excessive noise in the unit from fall 2013 to 2015. Since then there have been no further noise complaints against her. Justice Taylor declined to evict Ms. Watson and her son as such “draconian” remedies should be reserved for when there is an ongoing refusal to comply with rules. Justice Taylor let stand a lien of  $1714 in legal costs against the defendant’s unit.

Comment: Justice Taylor limited the costs of the application to a modest $2500, saying that, “a less heavy-handed approach might very well have avoided an application to the court.”

Otomic Contractors Ltd. v Royal 7 Developments Ltd., 2017 ONSC 1001
Decision Date: February 10, 2017
http://canlii.ca/t/gxj76

The plaintiff, an excavating contractor, was hired to work on Phase 1 of  a construction project being developed by the defendant. The parties’ contract contemplated that Otomic might continue to work on Phase II, but nothing was formalized. Things started out well. Otomic completed the work on Phase I and started on Phase II. After a number of months the relationship broke down and Royal 7 delayed payment of Otomic’s invoices or paid only portions of them. At some point the parties may have held a meeting to discuss their differences, although what was said at the meeting, who attended, and even whether a meeting took place, is in dispute. In this action Otomic claims that it is owed about $218,000 for work completed and seeks a declaration that it is entitled to a construction lien. Royal 7 has counterclaimed for about $274,000 on the grounds that it had to retain another contractor to finish the job that Otomic should have done, and that Otomic over-charged them for work completed.

Justice Mulligan found in favour of Otomic, saying that Royal 7 could not hold them responsible for the cost of continuing the excavation work on Phase II. He rejected the counter-claim as there was no evidence that Otomic over-charged Royal 7. He allowed Otomic’s lien and encouraged the parties to settle the issue of costs themselves.

Vitz Holdings  Inc. v. Toronto Standard Condominium Co. No. 1530, 2017 ONSC  1173
Decision Date: February 14, 2017
http://canlii.ca/t/gxlwr

The applicant owns a commercial unit in TSCC No. 1529 where he proposes to set up a dentist’s office. The construction of the office would require boring through the floor/ceiling of TSCC 1530 to install plumbing, power lines, insulation, etc. TSCC 1530 has granted an Easement to the owners of TSCC 1529 to install various utilities. TSCC 1530’s consulting engineer has approved the plans and suggested some changes, which the applicant has accepted.

The applicant also owns 4 parking spaces at TSCC 1530, and on this basis TSCC 1530 argues that the applicant is an “owner” of TSCC 1530 should comply with Section 98 of the Condominium Act. This would mean that the applicant must get the approval of the Board to make his alterations. TSCC 1530 also takes the positions that the applicant is not a beneficiary of the Easement, and that under a Shared Facilities Agreement he needs the consent of TSCC 1530 to make any “major change.”

Justice Penny found that it was simply “fortuitous” that the applicant owned parking units in TSCC 1530; he is entitled to the Easement; he does not have to comply with Section 98; and the proposed work is not a “major change.” The judge also granted costs of $9000 to the applicant.

Comment: I have no idea (and the written record gives no clue) as to why TSCC 1530 took the position that it did.

About the image: By bilbobagweedLoading, CC BY 2.0, Link

Condo Law Digest – February 2017

Mental health in the past

Toronto Standard Condominium Corporation No. 2395 v Wong, 2016 ONSC 8000
Decision Date: December 12, 2016
http://canlii.ca/t/gwn72

Ms. Wong owns a unit in TSCC 2395. In November 2016 she began a pattern of erratic and threatening behaviour, most of it targeted at a member of the condominium’s staff. Ms. Wong’s behaviour was sufficiently concerning that measures had to be taken to ensure the staff member’s safety. In this application TSCC 2395 asks for an injunction and compliance order prohibiting Ms. Wong from 1) contacting or coming within 25 feet of the management office or TSCC 2395 personnel; 2) disturbing the comfort and quiet enjoyment of the common elements. They also asked the judge to find that Ms. Wong’s behaviour amounted to workplace harassment and that she has breached the Condominium Act. In addition, they asked the judge to consider an order that Ms. Wong undergo an examination by a mental health practitioner for an opinion on whether she has a disability, such that the court should order the appointment of a litigation guardian.

Justice Akbarali agreed to grant the compliance order and the other relief. However she declined to order Ms. Wong to be examined by a mental health practitioner. She reasoned that Ms. Wong’s behaviour in itself was not a “sufficient evidentiary basis” to make the “invasive and rare order” that she undergo a mental examination. Justice Akbarali granted costs of about $16,500 to TSCC 2395.

Comment: A difficult case for all involved. For more on the condominium as a workplace, see my article in Condo Business.

About the image: An itinerant surgeon extracting stones from a man’s head. Pencil drawing by P. Quast. http://wellcomeimages.org/indexplus/obf_images/e0/40/a7ff774fee31eba68411e4295f34.jpg Gallery: http://wellcomeimages.org/indexplus/image/V0016245.html, CC BY 4.0, Link

 

Condo Law Digest – January 2017

Schaffnertasche mit galoppwechsler.jpeg

CIBC Mortgages Inc. v York Condominium Corporation No. 385, 2016 ONSC 8036
Decision Date: December 21, 2016
http://canlii.ca/t/gwkxb

This is a decision on costs in a case I covered last month. The dispute was over whether the mortgagee or the condominium corporation should receive the proceeds from the forced sale of a unit. The amount at issue was about $100,000.

Justice Dunphy began by chiding the parties for their “excessive zeal” in disregarding the limitations he had imposed on submissions. CIBC Mortgages asked for costs of about $70,500 while YCC 385 requested that the costs award be limited to a nominal amount.

The judge awarded CIBC Mortgages costs in the amount of about $62,500. His main consideration in making this award was that CIBC Mortgages had made two previous offers to settle for about half the proceeds from the sale. He reduced the costs requested by $8000 to reflect that excessive time and energy were spent in cross-examinations and examinations of witnesses, which ended up having little use at trial. Justice Dunphy rejected YCC 385’s arguments that “innocent” unit owners should not have to foot the bill. As he said, “The unit holders elect their managers and the conduct of litigation by management is ultimately their responsibility.”

Comment: It is worth repeating the judge’s remark that, “proportionality and reasonableness ought ever to be the lodestar held in view when conducting litigation.”

2308478 ONTARIO INC. v YRCC NO. 715, 2016 ONSC 6256
Decision Date: December 9, 2016
http://canlii.ca/t/gw0p6

YRCC 715 is an industrial-retail building and the applicant, Steven Torok, owns and operates a business in one of the units. In December 2014 he issued a claim against the Corporation and five directors for property damage, loss of profit, business interruption and breach of contract. In this action of April 2016 he seeks an order appointing an Administrator to manage the Corporation, saying that the current Board of Directors has not acted in the best interest of the corporation. In particular, they had not maintained an adequate reserve fund, had neglected to do maintenance, and had not addressed some parking issues.

While the Board spent almost no money on repairs or maintenance from 2012-14, they engaged a new property management company in Fall 2013, did significant roof repairs in 2014-15, and retained Ontario Parking Authority to tag illegally parked vehicles. Justice Dow agreed with Mr. Torok that it was his 2014 application to the court that prodded the Corporation to fulfill their responsibilities. However, given that self-governance is the norm and the appointment of an Administrator is supposed to be an exception, the judge dismissed the application.

Comment: In an unusual move, Justice Dow awarded costs of $2500 to Mr. Torok, although his application was unsuccessful.

Bastien v Egalite, Collings, Langlois, Bliss and Chinkiwsky 2016 ONSC 7652
Decision Date: December 2, 2016
http://canlii.ca/t/gvxvp

The plaintiffs purchased a condominium unit with the assistance of Mr. Egalite, a real estate lawyer. When the sale closed on January 3, 2014, the plaintiffs found extensive water damage in the unit due to a burst pipe and advised the vendors that they wanted to rescind (cancel) the purchase. The vendors refused and offered either a monetary settlement or to carry out the required repairs.  Mr. Egalite attempted to negotiate a rescission of the purchase but was unsuccessful. In February 2014 the plaintiffs retained Mr. Collings, a litigation lawyer, to make claims against the vendors, Mr. Egalite, and an insurance company. The plaintiffs failed to pay Mr. Collings’ invoices and so he withdrew. In July 2014 the plaintiffs retained another lawyer, Mr. Langlois, to assist them. When the plaintiffs did not give him further instructions, Mr. Langlois returned to them the unspent portion of their $1000 retainer and closed the file.

The plaintiffs allege that all three lawyers were negligent because they failed to take steps to rescind the condominium purchase. They have claimed $700,000 against Mr. Egalite, $500,000 against Mr. Collings and $300,000 against Mr. Langlois. These three defendants brought a motion to dismiss the action on the grounds that the claim has no chance of success. They argue that the plaintiffs have not offered any facts to support their allegations, and that they have not suffered any damages because of the defendants’ action or inaction. Justice R. Smith agreed and dismissed the action as frivolous and vexatious.

Comment: In his ruling Justice Smith provides an interesting discussion of the legal principles involved in dismissing an action as frivolous or an abuse of process.

About the image: Conductor’s bag with money changer. No machine-readable author provided. LosHawlos assumed (based on copyright claims). – No machine-readable source provided. Own work assumed (based on copyright claims)., CC BY-SA 3.0, Link

Condo Law Digest – December 2016

Czech-2013-Prague-Astronomical clock face.jpg

CIBC Mortgages Inc. v York Condominium Corporation No. 385, 2016 ONSC 7343
Decision Date: November 24, 2016
http://canlii.ca/t/gvsn5

This is a dispute between a bank and a Condominium Corporation over the proceeds from the sale of a unit in YCC 385. The Corporation was put under a court-ordered administrator in November 2010. In March 2011 the Corporation changed counsel and in May 2011 the administrator changed property management companies. (I mention these changes because they help explain the confusions that followed.)

The unit in question had been owned by Frank Blowes. In February 2011 a judge issued a number of restraining orders against Mr. Blowes and ordered him to pay YCC 385’s costs of $15,000 within 30 days. In March 2011 the amount that YCC 385 paid to counsel  regarding the dispute with Mr. Blowes were entered into its general ledger, rather than charged against Mr. Blowes’ unit. In August 2011 (new) counsel for YCC 385 uncovered the error and sent a demand letter to Mr. Blowes for $44,474 ($15,000 in court-ordered costs and another $29,272 in other costs recoverable as common expenses). Mr. Blowes did not pay, and a lien was registered on his property in December 2011 and served upon CIBC as the mortgagee of the unit. Mr. Blowes went to court twice (Dec 2012 and May 2013) in attempts to stop the proceedings. He was unsuccessful each time and costs were awarded against him. (It appears that he did not have legal counsel.) YCC 385 received possession of the unit from the Sheriff in November 2013 and agreed to a sale of the unit for $110,000 in April 2014. Meanwhile, over at CIBC, the documents related to the lien and the sale of the unit had been overlooked somehow. CIBC learned about the planned sale of the unit days before it was to occur. YCC 385 and CIBC agreed that the funds from the sale should be placed in trust pending determination of priority.

Justice Dunphy found in favour of CIBC. He reasoned that, if the default occurred earlier than three months before December 2011, then the proceeds of the sale should go to CIBC as the mortgagee. If the default occurred within three months of December 2011, then YCC 385 should retain the funds. Payment of the court-ordered costs (the original $15,000) was due in March 2011, meaning that a lien should have been registered in June. YCC 385 failed to register the lien on time, and so they had no right to revive it in  December.

Comment: This case underscores the need for timely and professional accounting services.

Peel Standard Condominium Corporation No. 837 v Davies Smith Developments Inc., 2016 ONSC 4947
Decision Date: October 27, 2016
http://canlii.ca/t/gvcms

This dispute is about deficiencies in the construction and installation of the HVAC system at PSCC 837. The Corporation claims damages of $500,000 against the vendor and developer of the Corporation; they in turn have counter-sued third parties (the suppliers and installers of the HVAC system). In this action, the defendants and the third parties move for summary judgment to dismiss, on the grounds that PSCC 837 waited too long to bring the claim.

PSCC 837 obtained engineering reports in November 2011 and March 2012, both citing “poor soldering connections” as the cause of water leaks. In February 2013 they commissioned a third report (delivered nine months later) which determined that the localized failures were the result of a systematic construction deficiency. PSCC 837 argues that it needed this report before it could file a claim for damages. The moving parties maintain that a claim could have been filed on the basis of the earlier reports.

Justice Pollak dismissed the claim for summary judgment, saying that neither side had provided enough evidence as to when PSCC 837 knew or should have known about the construction deficiencies.

About the image: The astronomical clock in Prague’s Old Town Square – the oldest such functioning clock in the world. Photograph by Godot13Own work, CC BY-SA 3.0, Link

Decisions, Decisions, Decisions: Why “bad decisions” may not be your fault

Emu (Dromaius novaehollandiae) looking backwards at Auckland Zoo
When I was teaching philosophy, one of the hardest things for my students to wrap their heads around was the concept of unintended consequences.

This came up whenever we discussed the theory of Utilitarianism. According to a Utilitarian, the best ethical decision is the one that results in the best outcomes; that is, the highest levels of happiness and pleasure for everyone involved.

The problem is that, even with the best intentions, things don’t always turn out as planned. An action meant to help can harm. An action done for selfish reasons can end up benefiting others. The success or failure of our decisions can depend on factors we haven’t considered or even imagined.

Hindsight Bias

My students (perhaps because of their youth) had trouble with the idea that the best-laid plans could go wrong. The flip-side of this difficulty is hindsight bias. This is the prejudice that, when something goes wrong, we should have been able to predict it in advance.

We see this kind of “Monday morning quarterbacking” all the time. After a terrorist attack, an unexpected election result, or other unforeseen events, all kinds of people step forward to say that they saw it coming all along.

What happens is that we treat the information we have as though it is all the information there is. Then we construct a story in which various participants made bad decisions. We forget that we don’t have full information, and that the success and failure of decisions are likely attributable to factors we haven’t considered.

The (somewhat chilling) reality is that we may never know why our actions have the consequences that they do. Accidents happen and people get lucky. Just because things have gone poorly doesn’t mean that we can trace events back to a particular decision. (Conversely, just because things go well doesn’t mean that we can always take credit.)

Making it Relevant

Hindsight bias affects our evaluation of our past actions, rather than decision making in the moment. When evaluating past decisions, it is good to try to learn from your mistakes and especially to spot patterns of thought that might be holding you back. But be compassionate with yourself. Just because things have gone wrong, doesn’t mean that your decision was flawed.

Source

Daniel Khaneman, Thinking Fast and Slow, Doubleday, 2011.

Note: Most of us make a huge number of decisions each day. A few are momentous; most seem trivial at the time. And yet trivial decisions, made over and over, can take on huge significance. This is the fourth in an occasional series on the psychology (and philosophy) of decision making. I’m interested in this topic because in my work as a mediator I help people make good decisions (or at least, understand the implications of their decisions).

About the Image: An emu (Dromaius novaehollandiae) looking backwards, at Auckland Zoo by Avenue (Wikimedia Commons).

Condo Law Digest – November 2016

Allainville dans les Yvelines le 18 août 2012 - 15.jpgMiddlesex Condominium Corporation No. 229 v 1510231 Ontario Inc. et al., 2016 ONSC 6325
Decision Date: October 11, 2016
http://canlii.ca/t/gv2jt

The defendant numbered corporation (hereafter 151) owns property adjacent to the MCC #229. They share ownership of a retaining “gabion wall.” (This is a wall made of cages or boxes filled with rocks, sand, concrete, etc. See the photo above.) The wall, which was constructed in 1989, provides support to easements that MCC #229 has over 151’s property. The wall has deteriorated since a “major collapse” in 2003 and neither side has repaired or maintained it. In this action, MCC #229 seeks a summary judgement that 151’s negligence in maintaining the wall has interfered with their easement rights and therefore caused them damages.

So the question is, does the servient tenement (in this case 151) have a duty to repair with respect to easement rights of the dominant tenement (in this case MCC #229)? The short answer is no: the obligation of a servient tenement is always negative (that is, not to do something). A positive obligation (for example, to repair) can  be imposed only by a positive covenant. Justice Mitchell dismissed the claim.

Comment: I have not summarized claims against two additional defendants and counter-claims. MCC #299 made two previous claims against 151 regarding the wall, in 2004 and 2009. I can only wonder whether legal proceedings have cost more than repairing the wall would have.

Kamal v. Peel Condominium Corp. No. 51, 2016 HRTO 1282
Decision Date: Sept 30, 2016
http://canlii.ca/t/gv0g7

Three Muslim unit owners brought an HRTO claim against their condominium corporation and property management company. They accuse the defendants of discriminating against them on the basis of creed by holding a special owners’ meeting on the religious holiday of Eid-ul-Azha in 2013. The applicants belong to a group of Muslims who celebrate Eid 10 days after the sighting of the crescent moon (Oct. 16), rather than on a fixed calendar date (Oct. 19). The date of the meeting was arranged a couple of weeks before the sighting of the crescent moon. By the time the date of Eid was announced, PCC #51 claimed that there was not enough notice to change the date of the meeting.

In order to be successful in their application the applicants would have to show that the respondents treated them in a “distinct and disadvantageous manner” because they are Muslim, or that the respondents’ actions had an adverse effect on them because they are Muslim. The Adjudicator dismissed the applications against both the property management company (who played no part in setting the meeting date) and PCC #51. There was no evidence that the scheduling of the meeting was meant to exclude Muslims; the opportunity to vote by proxy was an adequate accommodation.

Comment: As the Adjudicator said, “In a condominium corporation with 169 units, there will almost always be someone who is unable to attend a meeting for Code-related reasons, such as disability, family status (i.e. childcare and/or elder care), or creed.”

TSL-75956-16 (Re), 2016 CanLII 71241 (ON LTB)
Decision Date: October 17, 2016
http://canlii.ca/t/gv8hc

The applicant owns a unit in a residential condominium, which she rents. In May of this year the police raided the apartment, breaking down the door in the process. The repairs cost $7000 and the applicant seeks an order requiring the tenants to reimburse her this amount. According to the Residential Tenancies Act, 2006, a landlord is entitled to the cost of repairs if the damage was caused by the willful or negligent actions of a tenant, another occupier of the rental unit, or a person whom the tenant permitted in the residential complex.

The Chairman dismissed the application. First, the police were not individuals permitted in the complex by the tenants. Second, as the police officers who raided the unit were not present at the tribunal, there was no way to know if they broke down the door because the tenants refused them entry. (In which case the damage would have been caused by the tenants’ willful or negligent actions.)

Comment: The landlord did not supply a police report, and the questions of who or what the police were looking for and what actually happened on the night of the raid, are shrouded in mystery.

About the Image: A gabion wall, Yvelines, France by Lionel AllorgeOwn work, CC BY-SA 3.0, Link

Condo Law Digest – October 2016

1920 electric washer adHadani v Toronto Standard Condominium Corporation No. 2095, (ON SCSM)
Decision Date: June 30, 2016
http://canlii.ca/t/gsx74

Ruling on Costs
Decision Date: August 24, 2016
http://canlii.ca/t/gtm75

Mr. Hadani owns a penthouse unit in TSCC No. 2095. Sometime before October 2013 flooding occurred in the unit below his. The Corporation determined that the source of the flooding was a leak from the washing machine in Mr. Hadani’s unit. In October 2013 the Corporation place a lien in the amount of $16,600 on the unit to cover the cost of the damage. The lien was paid by Mr. Hadani’s mortgagee. In this Small Claims Court action Mr. Hadani seeks a return of the lien plus interest, on the grounds that the flooding had nothing to do with his washing machine.

Deputy Justice Marr reviewed the evidence and found that, on the balance of probabilities, the flooding was indeed caused by Mr. Hadani’s washing machine. The Corporation’s actions were not unreasonable and he dismissed Mr. Hadani’s action.

Justice Marr made a subsequent ruling on costs. The Corporation asked for costs of $30,823 on a full indemnity basis, and $2170 in disbursements. Normally an award of costs in Small Claims Court shall not exceed 15% of the amount claimed, unless the court considers it necessary “in the interests of justice” to penalize unreasonable behaviour. The Corporation argued that Section 85 and Article 7.1 of the Condominium Act entitles them to seek full costs, and that Mr. Hadani “unreasonably prolonged” the proceedings. Justice Marr disagreed; just because Mr. Hadani’s arguments were unsuccessful, does not mean that they were unreasonable.

Justice Marr awarded $2490 costs to TSCC No. 2095 (15% of $16,600) and reduced disbursements to $600.

Comment: To quote the judge, “A cost claim that is almost twice as much as the amount sought by the Plaintiff in damages is not proportionate and accordingly is not fair or reasonable.”

Condo Law Digest – September 2016

Frank W. Benson, The Open Window, 1917.jpg
Pylon Paving (1996) Inc. v Arrow Lofts Inc. et al, 2016 ONSC 4660
Decision Date: July 21, 2016
http://canlii.ca/t/gsmj2

In Fall 2011 Pylon Paving did some paving for the Arrow Lofts parking structure, a condominium development in Kitchener. Pylon wasn’t paid for the work, and so they started a lien action for the unpaid balance (around $20,000). Arrow responded with  counterclaim for $175,000 on the grounds of breach of contract and breach of express warranty. Arrow charges that Pylon’s work was defective and must be removed and replaced.

Experts for both sides agreed that the asphalt in the parking structure has deteriorated. Pylon’s expert (whose opinion was preferred by Justice Flynn) argued that the deterioration stems from an original flawed design, and that Pylon did their best with the unpaved project they were given. Pylon was supposed to install 50 mm of asphalt; however the design permitted them to install only 42 mm. While Pylon should have alerted Arrow in writing to this issue, the fact that they failed to install 50 mm of asphalt does not amount to a breach of contract.

Justice Flynn dismissed Arrow’s counter-claim but found that Pylon was not entitled to the full amount of their claim. He reduced the amount owed by Arrow to Pylon by $10,000 because of their failure to address the paving deficiencies in writing once they became aware of them.

Comment: Justice Flynn stressed the importance of prompt resolution and of putting things in writing: “Too often in these construction disputes an ounce of writing could prevent a pound of trouble.  That simple exchange in writing may have produced a shouting match ending with “I told you so”, but it most likely would have avoided a three day trial.”

TST-72521-16 (Re), 2016 CanLII 52980 (ON LTB)
Decision Date: July 25, 2016
http://canlii.ca/t/gt02j

This is a judgment from the Landlord-Tenant tribunal. The rental unit is in a condominium building that required work on its pipes from Feb 25 to March 5, 2016. During some of this time the water was turned off from 9 am to 5 pm. While their water was off, the Tenants were rehoused in the condominium’s guest suite, which did not have a working kitchen. The Tenants alleged “substantial interference of their reasonable enjoyment” of the rental unit and asked for an abatement of rent. The Chairman found that the Landlord took “all reasonable steps” to minimize impact on the Tenants. Nonetheless he agreed that the Tenants were entitled to an abatement of rent (25% for 10 days, amounting to about $144), and also to $380 to cover meal expenses during the work.

Nicholas v Toronto-Dominion Bank and Carleton Condominium Corporation No. 336, 2016 ONSC 3824
Decision Date: August 12, 2016
http://canlii.ca/t/gsx2g

This sad story begins in 2011 when CCC No. 336 decided to replace the exterior windows of all condominium units. Mr. Nicholas disagreed with the Board’s choice of window, refused entry to his unit to change the windows, and stopped paying his monthly common expense fees. CCC 336 obtained court-ordered access and changed the windows at added cost. A September 2011 court order determined that Mr. Nicholas owed over $17,000 in common expenses (including the Corporation’s legal costs and the added cost of window replacement.) When Mr. Nicholas refused to pay, the Corporation registered a lien of about $20,000 against his unit. In March 2012 the Corporation’s lawyers issued a Notice of Sale under the lien. In the spring of 2013 the TD Bank (holder of Mr. Nicholas’s mortgage) paid about $30,000 (cost of lien, legal fees, ongoing monthly common expenses and compounding interest) to CCC 336. The Bank issued a statement of claim against Mr. Nicholas for possession of his unit and about $74,000 for indebtedness, (roughly $44,000 of principal owed on the mortgage, the $30,000 paid to CCC 336, interest and some incidentals). TD Bank obtained default judgment in October 2013 and Mr. Nicholas was evicted in January 2014. The unit sold for $205,000 in June 2014 and TD paid into court the net proceeds of over $99,000 which were paid to Mr. Nicholas in January 2015.

In this action, Mr. Nicholas seeks damages for financial loss due to his unlawful eviction and the sale of his unit, damages for his costs of accommodation, moving, etc., and damages for the negative financial impact on his credit rating. Justice Kane dismissed most of these claims by summary judgment, and scheduled a 2-day trial for some remaining issues between TD and Mr. Nicholas.

Comment: Just about the worst thing an owner can do during a dispute with a Condominium Corporation, is to stop paying common expense fees. The legal fees and interest simply balloon. Better to pay the fees “under protest” and seek legal advice.

About the image: By Frank W. Benson, 1917 – http://www.the-athenaeum.org/art/display_image.php?id=162751, Public Domain, https://commons.wikimedia.org/w/index.php?curid=32012315

Decisions, Decisions, Decisions: Important Decision? Take it Slowly

Korea-seoul-Namsan-slow sign.jpgThe idea that our decisions are strongly influenced by unconscious factors is very popular. (Malcolm Gladwell, I’m looking at you.)

We’re sometimes advised to go with our “gut feelings.” The implication is that decisions made in this way will be better – or at least not worse – than decisions that we spend more time on.

However the evidence is more complicated.

What Kind of Decision are you Making?

For relatively minor matters, going with your gut is likely to be fine. If you’re choosing between different colour Tshirts or scarves, for example, the first one that caught your eye is often the one you choose on longer reflection.

For decisions involving skilled assessment and expert knowledge, however, longer deliberation, within a structured framework, will yield better decisions.

In one study, experienced doctors were asked to assess twelve real-life cases, presented in a booklet. For four of the cases, the doctors was asked to read the cases and give an immediate diagnosis. For another four, they read a case, performed a task designed to distract them, then provided a diagnosis. For another four, the doctors were asked to read the cases and then to follow a structured procedure in which they analyzed the case, offered several hypotheses, and then made a diagnosis.

How did the quick diagnoses and the distracted diagnoses compare with the slow, deliberate diagnoses? Conscious deliberation resulted in a 50% gain in diagnostic accuracy.

I suspect – and I’ve seen evidence – that something similar is true of hiring decisions. Having a list of objective criteria and going through a standard procedure for each candidate results in better outcomes than having the hiring manager “go with her gut.”

And interestingly, old advice about not changing your answer in a multiple choice test turns out to be invalid. Changed answers are more likely to be correct.

Making it Relevant

Think about what kind of decision you’re making. If it is one where expert knowledge is relevant or analysis of evidence is required, then take it slow. If the decision has more to do with your feelings or preferences, going with your gut is fine.

Source

Ben R. Newell and David R. Shanks, “Unconscious Influences on Decision Making: A Critical Review,” Behavioral and Brain Sciences 2012.

About the image:  GPL, https://commons.wikimedia.org/w/index.php?curid=267165

Note: This is the third in an occasional series on the psychology (and philosophy) of decision making. I’m interested in this topic because, as a mediator, one of the things I do is to help people make good decisions (or at least, to understand the implications of their decisions).

Most of us make a huge number of decisions each day. A few are momentous; most seem trivial at the time. And yet trivial decisions, made over and over, can take on huge significance.

Breaking up a Business Partnership Doesn’t Have to Be a Trial

Men fightingA few months ago I wrote about Sam and John. They built a successful app together but personal conflict lead to a break-up of their business relationship. A large portion of their profit went to pay legal fees.

The legal mess cost them in other ways, too. It took up so much time and energy that other projects each wanted to pursue had to be put on hold. There were personal costs as well. The constant stress caused both men’s personal relationships to suffer.

Even if Sam and John had decided that they didn’t want to work together anymore, things could have ended differently. Too many business partnerships end up in costly litigation. It doesn’t have to be that way. Doing things differently can save money, time, preserve relationships, and protect your reputation.

Most people now know that, if your marriage breaks down, you don’t have to fight it out in court. But there is less awareness about alternative dispute resolution (ADR) for business partnership break-ups.

The two main forms of ADR are mediation and arbitration. Both are private, and both are likely to save you time and money.

In mediation, the parties sit down together with a neutral third party whose role is to facilitate discussion.  Mediation is very flexible and allows for creative solutions.  In the best case, mediation is a collaborative process; the parties exchange information and work towards a solution together.  Because the parties are working together to reach common goals, mediation can preserve and even strengthen relationships.

Arbitration is like a private trial, with the arbitrator acting as a private judge chosen by the parties.  (If the parties cannot agree on an arbitrator, one side may be able to ask the court to appoint the arbitrator.)  An arbitrator’s judgment is binding, like a court’s judgment, and can be appealed only in very special circumstances.  The arbitrator also has the power to decide costs.  This means that he or she can determine that one of the parties (usually the losing side) will have to pay the other side’s legal costs as well as their own.

Arbitration is more risky than mediation, because a third party is making the decisions. In mediation, the parties have control over the outcome, and you don’t have to agree to anything you don’t want to. Arbitration also tends to be more expensive than mediation.  Arbitrators charge more for their time than do mediators, and legal costs tend to be higher because it takes lawyers longer to prepare for an arbitration than for a mediation.  The advantage of arbitration over mediation is that, at the end of the process, there is an enforceable judgment and the dispute is over.  If mediation fails the parties may be left without a resolution.

As in the case of marital separation, each business partner should have independent legal advice. This is to make sure that each person understands their legal rights and responsibilities. (A lawyer cannot give “independent” advice to two parties in the same dispute.) Finding the right lawyer is crucial, if you mean to stay out of court.  When you’re consulting a lawyer, make sure that he or she is open to options other than litigation. If not, then the lawyer may not be a good fit. (Not convinced you need your own lawyer – or any lawyer? Read my “I’m in mediation. Why do I need a lawyer?”)

Finally, “Begin with the end in mind.” When setting up a business partnership agreement, include a clause that, in the event that the partnership is to be dissolved, the partners will try ADR before heading for court.

About the Image: Drawing by George Fitch, Internet Archive Book Images [No restrictions], via Wikimedia Commons.