What is a Status Certificate and why is it important


Status certificate

Status certificates are particularly important for prospective buyers of resale condos as these documents contain key information about a unit of interest and the corporation.

Anyone can request a status certificate. Corporations can charge up to $100 including all applicable taxes to provide it and must provide them within 10 days.

What do status certificates contain?

Status certificates may contain:

  • A copy of the condo corporation’s current declaration, by-laws and rules
  • A copy of the budget for the current fiscal year, last annual audited financial statements and the auditor’s report
  • A statement on the most recent reserve fund study and the state of the reserve fund
  • A statement of the common expenses for the unit and if the unit’s in arrears of payment
  • A statement of the increase in common expenses and the reason, if applicable
  • A statement detailing if any special assessments were charged to the unit since the current year’s budget and the reason for the assessments
  • Names and addresses for service for the directors and officers of the condo corporation
  • Certificate of insurance for all current insurance policies
  • If there are any outstanding legal judgments against the condo corporation, or if the condo corporation is involved in any ongoing litigation

Why status certificates are important

Status Certificates contain critical information and supporting documents that help buyers make informed decisions. Buyers should review these with their legal counsel.

Buyers should also speak to a legal or real estate professional when purchasing a resale condo and check the CAO’s Condo Registry.

Condo corporations need to be mindful when preparing status certificates as any information that is included or not included in the status certificate will bind the corporation. For example, a recent Superior Court of Justice decision found that a condo owner was exempt from paying their portion of a special assessment because it was not clearly noted in the status certificate.

The SCJ decision highlights some important things for both buyers and condo corporation to consider regarding status certificates:

  • Condo corporations may not be allowed to collect fee increases that have not been properly disclosed in status certificates
  • Disclosure should be done as soon as the condo believes there is a risk for future fee increase
  • Certificates must disclose potential fee increases in clear language
  • Condo buyers should have their lawyers review status certificates

Read More: https://www.condoauthorityontario.ca/condo-living/corporate-records/status-certificates/