Legal Responsibilities of Condominium Corporations to Manage Risk
Condominium corporations have legal obligations to manage risks affecting the property, residents, and financial health of the condominium. These obligations are established under the Condominium Property Act and Regulation and further supported by the Occupiers’ Liability Act.
Under the Occupiers’ Liability Act:
"An occupier of premises owes a duty to take such care as in all the circumstances of the case is reasonable to see that a person and that person’s property on the premises will be reasonably safe in using the premises."
For condominium boards, this means they must take reasonable steps to identify, mitigate, and manage risks related to:
Common property safety (e.g., sidewalks, stairwells, elevators, and parking areas).
Financial stability (e.g., reserve fund planning and insurance coverage).
Operational efficiency (e.g., emergency preparedness and maintenance schedules).
Failure to fulfill these obligations can result in legal liability, financial losses, and reputational damage for the condominium corporation.
Proactive Risk Mitigation Strategies
To fulfill their responsibilities, condominium boards should implement proactive risk mitigation measures to prevent potential hazards and liabilities.
A. Establishing Maintenance Schedules for Common Areas
A well-maintained property reduces the risk of accidents, injuries, and costly repairs. A condominium board should:
Implement routine inspections of high-risk areas, such as parking lots, walkways, and mechanical systems.
Ensure contractors and service providers adhere to safety standards.
Address repair requests promptly to prevent minor issues from escalating.
B. Implementing Emergency Preparedness Plans
Condominium boards must develop and enforce emergency response procedures to protect residents and property. This includes:
Fire evacuation plans and ensuring fire suppression systems (e.g., sprinklers, alarms) are functional.
Emergency contact lists for residents, service providers, and first responders.
Disaster recovery planning for floods, power outages, or security breaches.
C. Ensuring Adequate Insurance Coverage
Condominium corporations are required to maintain appropriate insurance policies to cover potential liabilities. Key considerations include:
Property insurance to cover damages to common areas.
Liability insurance to protect against claims arising from injuries, negligence, or property damage.
Directors and officers (D&O) insurance to protect board members from personal liability related to their decisions.
Proper documentation and review of insurance policies help ensure the condominium corporation remains adequately protected.
Case Studies
Applying Risk Mitigation Strategies to Real-World Condominium Scenarios
Case Study 1: Slip-and-Fall Incident on Icy Walkway
Scenario: A resident slips and falls on an unsalted icy walkway in a condominium complex. They sustain injuries and file a liability claim against the condominium corporation.
Risk Mitigation Strategies:
Routine winter maintenance schedule: Ensure snow removal and de-icing occur at scheduled intervals.
Contract with a professional snow removal service: Hold contractors accountable for performance.
Install warning signage: Notify residents of potential slip hazards during winter conditions.
Case Study 2: Fire Safety Compliance Issues
Scenario: During a routine fire code inspection, authorities discover that several fire extinguishers in a condominium building have expired. The condominium board faces potential fines and compliance orders.
Risk Mitigation Strategies:
Establish a fire safety inspection checklist to ensure fire alarms, extinguishers, and sprinklers are properly maintained.
Schedule annual fire safety training for board members and staff.
Maintain up-to-date records of all fire safety inspections and maintenance reports.
Case Study 3: Unauthorized Access and Security Breach
Scenario: A faulty security gate allows unauthorized individuals to enter a condominium’s underground parking. Several vehicles are vandalized, and residents demand accountability.
Risk Mitigation Strategies:
Regular security system maintenance to ensure gates and surveillance cameras function correctly.
Implement access control measures, such as key fobs or entry codes with strict permissions.
Require security personnel or third-party monitoring for high-risk areas.
