When a Buyer Wants the Whole Condo Building: The 80% Vote and What Dissenters Can Do

A sale of the whole property needs two separate 80% approvals. Once it is authorized, voting yes and voting no leave you with very different exposure, and the no side runs on a 10-day clock.

The meeting ran late. This morning the minutes are not out yet, but you already know the result: the motion to sell the whole property to the buyer cleared the threshold, and you were one of the owners who voted against it. What is easy to miss is that the statute did not stop at the vote. If you want to dispute the price, you have 10 days from that vote to give the corporation written notice of intention, and the clock has already started.

I’m Arthur Zhao with AZ Real Estate Partners. This is an unusual kind of sale: nobody listed your unit, yet it can be sold along with everyone else’s. Below I set out how the Condominium Act, 1998 handles it, organised by where you stand: voting yes, voting no, carrying a mortgage, or owning more than one unit. It is a summary of the statute, not legal advice on your building; for that, bring your meeting package to a lawyer.

Three ways a building leaves the Condominium Act

Part VIII of the Condominium Act, 1998 is headed Termination, and it covers more than one route. Before you decide anything, check which one your notice is actually about.

1. Termination with consent (s.122). The owners of at least 80 per cent of the units vote in favour of termination, and at least 80 per cent of those holding registered claims created after the declaration was registered consent in writing. The corporation then registers a notice of termination. Nobody is bought out. Under s.127(1)(b), the owners become tenants in common of the land in the same proportions as their common interests, and under s.127(1)(d) each unit’s encumbrances become claims against that owner’s interest in the land. The building stops being a condominium, but the owners still own it together.

2. Sale of the property (s.124). The approval thresholds are the same two 80% tests, but the result is different: the corporation conveys the property to a buyer, the Act stops governing it, and the owners share the net proceeds (s.124(1) and (4)). This is the route the rest of this article covers, and it is the only one of the three that comes with the dissent rights in s.125.

3. Termination by court order (s.128). The corporation, an owner, or someone with an encumbrance against a unit can apply to the Superior Court of Justice. The court may terminate if it is just and equitable, having regard to the scheme and intent of the Act, the probability of unfairness to owners, the probability of confusion and uncertainty, and the best interests of the owners.

For completeness, s.123 is a fourth, narrower route: after substantial damage (estimated repair cost of at least 25 per cent of the replacement cost of all buildings and structures), owners of at least 80 per cent of the units can vote to terminate instead of repairing.

If your notice speaks of a purchaser, a purchase price and a vote to authorise a sale, you are looking at s.124.

Where you stand going into the vote

The same vote produces different results for different owners. Find your position below; more than one may apply to you.

If you intend to vote yes

A yes vote counts toward the first threshold in s.124(2)(a): the owners of at least 80 per cent of the units, at the date of the vote, voting in favour. According to the Condominium Act, 1998 (s.124(4)), if the sale goes ahead you share in the net proceeds with every other owner at the time the deed is registered, in the same proportions as your common interests.

What a yes vote does not settle is the price. Any owner who dissented can, within 30 days of the vote, take a dispute over the property’s fair market value, measured as of the time of the sale, to mediation (s.125(1)). If it goes on to arbitration and the arbitrated value is higher than the sale price, the following provisions apply, in this order:

• s.125(4): each owner who served a notice of intention is entitled to receive from the proceeds what they would have received had the sale price been the arbitrated value.
• s.125(5): if the proceeds are not enough to pay that, the corporation pays those owners the deficiency.
• s.125(6): the owners other than those who dissented on the vote are liable for the deficiency payments, in proportion to their common interests.
• s.125(7): the corporation adds the liability of each owner who voted in favour of the sale to the common expenses for that owner’s unit, and may set a time for payment.

Read (6) and (7) separately. Subsection (6) describes the owners who are liable, and subsection (7) describes the owners whose common expenses the corporation charges. They are worded differently in the statute, and I am not going to blur them into one rule here.

If you intend to vote no

Your no vote matters while the count is open, because the sale needs the owners of at least 80 per cent of the units voting in favour. Once that threshold and the written-consent threshold in s.124(2)(b) are both met, a no vote does not stop the sale, and nothing in s.125 lets a dissenting owner keep their unit or require anyone to buy it separately.

According to the Condominium Act, 1998 (s.125(1)), what an owner “who has dissented on the vote authorizing the sale” gets is a right to dispute the fair market value of the property that was sold, determined as of the time of the sale. It runs on two deadlines, both counted from the vote, not from closing:

• Within 10 days after the vote: give the corporation notice of intention (s.125(3)). This is the shorter deadline, and it expires first.
• Within 30 days of the vote: submit the dispute to mediation (s.125(1)).

Section 125(2) then applies s.132 with necessary modifications. Under s.132(1), the disagreement goes first to mediation by a person the parties select and, unless the mediator obtains a settlement, then to arbitration under the Arbitration Act, 1991. If the arbitrated value is higher than the sale price, you receive from the proceeds what you would have received had the property sold at that value (s.125(4)). The entitlement in s.125(4) belongs to an owner who served a notice of intention, so missing the 10-day notice is the costly mistake. If the arbitrated value is not higher, the statute provides no top-up.

The steps are short and the deadlines are tight, so if you are seriously considering this route, have a lawyer look at your notice the day after the vote, not the week before the 30th day.

Voting yes vs voting no: what each position leaves you with

If your unit is mortgaged

Your lender is part of the approval, not a bystander. Section 124(2)(b) requires written consent from at least 80 per cent of those who, at the date of the vote, hold registered claims against the property being sold that were created after the declaration and description were registered. In practice, these are mainly the lenders holding mortgages on individual units.

The reason is what closing does to those claims. When the deed and certificate are registered, claims against the property sold that were created after the declaration was registered are extinguished (s.127(2)(c)). The statute does not set out how each mortgage is paid from the proceeds; that is handled by the lawyers at closing, and you should not assume anything about the numbers until your lender and your lawyer have looked at your file.

If you own more than one unit, or a parking or locker unit

The threshold in s.124(2)(a) is written as “the owners of at least 80 per cent of the units”. If you own several units, read that wording with your lawyer before assuming how your votes are counted. Whether a parking space or locker is a separate unit at all depends on how your building’s declaration and description set it up. Some buildings make them units; others make them exclusive-use common elements. Check your declaration rather than relying on what neighbours have been told.

One related point from s.124(2.1) and (2.2): an owner whose common expense contributions are 30 days or more in arrears loses the right to consent under clause (2)(c), which only applies when part of the common elements reserved for designated units is sold. It is not a rule about the owners’ vote in clause (2)(a). The right comes back once the arrears are paid.

What closing does

When the sale takes place, the board delivers to the buyer a deed and a certificate in the form prescribed by the Minister, signed by the corporation’s authorized officers, stating that everyone required to vote in favour or consent in writing under s.124(2) has done so (s.124(3)).

Once the deed and certificate are registered, s.127(2) provides that:

• the Condominium Act stops governing the property sold (clause (a));
• claims against the land created before the declaration and description were registered remain as effective as if the condominium had never been registered (clause (b));
• claims against the property sold created after the declaration was registered are extinguished (clause (c)).

The money then moves in two separate streams. The net sale proceeds go to the owners at the time the deed is registered, in proportion to their common interests (s.124(4)), except that proceeds attributable to common elements reserved for certain designated units are divided among those owners according to how their interests are affected (s.124(5)). The corporation’s own assets are dealt with under s.129: they first pay all money claims against the corporation, and the remainder is distributed among the owners in proportion to their common interests.

Two things this article does not cover. Tenants living in units have their own rules under the Residential Tenancies Act, 2006, which is a separate question. Tax treatment of your share is also out of scope; ask your accountant.

Documents to read before the vote

Pull these together while there is still time to ask questions. Each item points to a document, not to a deadline.