In Kumer v. MTCC No. 775, 2021 ONSC 1181, Madam Justice Audrey P. Ramsay determined that a correctness standard applied to appeals of arbitration awards rendered under the Condominium Act, 1998, SO 1998, c 19.Ramsay J. observed that neither party argued Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 and she accepted the guidance set out in (i) 90 George Street Ltd. v. Ottawa-Carleton Standard, 2015 ONSC 336 which noted that “arbitration pursuant to the Condominium Act is distinguishable and very different from the arbitration of a commercial dispute” and (ii) Metropolitan Toronto Condominium Corporation No. 590 v. The Registered Owners and Mortgagees of Metropolitan Toronto Condominium Corporation No. 590, 2020 ONCA 471 which remarked that a condominium declaration is “a special form of contract, the structure of which is prescribed by statute. It must adhere to certain statutory requirements”. Both decisions distinguished Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53 (CanLII),  2 SCR 633 because it concerned commercial arbitration. Ramsay J. agreed with the Court of Appeal’s comments in 2020 that “while a declaration under the Condominium Act could be characterized as a contract, [it] is not the type of private contract negotiated between two parties, to which the comments in Sattva were directed. A declaration is a special form of contract, the structure of which is prescribed by statute. It must adhere to certain statutory requirements”.
Metropolitan Toronto Condominium Corporation No. 775 (“MTCC”) registered its declaration on May 16, 1988 at the Toronto land registry office, land titles division pursuant to the requirements of the Condominium Act, 1998, SO 1998, c 19 (“Condominium Act”) including section 2.
A dispute arose between MTCC and Appellants who owned a unit in the condo complex and had attached screens to the metal fences surrounding the exclusive-use common-area patio at the front of their unit.
Ramsay J. recorded the absence of any dispute that: (i) the patio forms part of the MTCC’s common element; (ii) Appellants had exclusive use of the patio; and, (iii) Appellants did not have MTCC’s board’s consent to affix the screens to the patio fences. Appellants did dispute whether doing so qualified as having “erected” the screens.
Ramsay J. observed that section 116 stipulates that the right of unit owners like Appellants to may make reasonable use of the common elements is subject to the Condominium Act, a condominium corporation’s declaration, its by-laws and its rules. Section 19 (1) of the Condominium Act also requires that owners comply with the condominium corporation’s declarations and rules.
The parties engaged in arbitration as required by the Condominium Act and likely the terms of either MTCC’s by-laws or its rules. Ramsay J. stated that the issue before the arbitrator was whether Appellants had erected screens on the exclusive use common element area without the consent of MTCC in violation of the Condominium Act, the Declaration and the Rules. Following a hearing in the arbitration, an award issuing finding against Appellants (“Award”).
Appellants applied under section 46 of the Arbitration Act, 1991, SO 1991, c 17 to set aside the Award.
Standard of review (paras 20-34) – Appellants did not specify a standard of review in the written materials or rely on case law. MTCC relied on Toronto Standard Condominium Corporation No. 2256 v. Paluszkiewicz, 2018 ONSC 2329 which held that the standard of reasonableness applied on questions of fact, mixed fact and law or law “unless the question of law is a general question of law that transcends the specific regime or that is both of central importance to the legal system as a whole and also outside the adjudicator’s specialized area of expertise”.
At para. 21 Ramsay J. noted that Toronto Standard Condominium Corporation No. 2256 v. Paluszkiewicz set no express standard but at para. 27 determined that the decision “appeared to use [the] reasonableness standard of review”. Ramsay J. added that MTCC did not qualify the issue on appeal as one which raised either standard but did rely on a standard of reasonableness.
Ramsay J. did note that the court in 90 George Street Ltd. v. Ottawa-Carleton Standard, 2015 ONSC 336 para. 44 applied a correctness standard for a decision rendered under the Condominium Act and distinguished Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53 (CanLII),  2 SCR 633 because that decision concerned commercial arbitration. (See the urbitral notes below for a fuller excerpt from that decision for more on the distinction drawn by the court).
In Simcoe Condominium Corp. No. 78 v. Simcoe Condominium Corp. Nos. 50 et al,  O.J. No. 605 (S.C.J.), the court reasoned that that correctness standard applied because (i) the appeal concerned a question of law and (ii) the arbitrator had no greater expertise than the court.
Ramsay J. referred to paras 105-106 from Sattva Capital Corp. v. Creston Moly Corp. regarding the analogies between judicial review, including the following:
“Additionally, as expertise is a factor in judicial review, it is a factor in commercial arbitrations: where parties choose their own decision-maker, it may be presumed that such decision-makers are chosen either based on their expertise in the area which is the subject of dispute or are otherwise qualified in a manner that is acceptable to the parties. For these reasons, aspects of the Dunsmuir framework are helpful in determining the appropriate standard of review to apply in the case of commercial arbitration awards”.
With reference to Teal Cedar Products Ltd. v. British Columbia, 2017 SCC 32 (CanLII),  1 SCR 688 para. 75, Ramsay J. pointed out that a reasonableness standard “almost always” applies to arbitrators’ decisions.
Ramsay J. also commented that the Court of Appeal in Metropolitan Toronto Condominium Corporation No. 590 v. The Registered Owners and Mortgagees of Metropolitan Toronto Condominium Corporation No. 590, 2020 ONCA 471 applied a standard of correctness after having noted the difference between the contract considered in Sattva Capital Corp. v. Creston Moly Corp. and a condominium declaration which are “special contracts prescribed by statute”.
“ This is not a factually driven issue. To the contrary, the issue turns on the words used in these two sections of the Declaration, the proper interpretation of those words, and whether that proper interpretation demonstrates an error or inconsistency. These are questions of law. Questions of law attract a standard of review of correctness: Housen v. Nikolaisen, 2002 SCC 33,  2 S.C.R. 235, at para. 8.
 In reaching that conclusion, I am aware of the caution expressed in Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53,  2 S.C.R. 633, at para. 54, against courts too readily finding extricable questions of law when engaged in contractual interpretation. Here, though, while a declaration under the Condominium Act could be characterized as a contract, is not the type of private contract negotiated between two parties, to which the comments in Sattva were directed. A declaration is a special form of contract, the structure of which is prescribed by statute. It must adhere to certain statutory requirements. Indeed, the Condominium Act provides, in s. 7(5), that, if there is any conflict between the statute and the declaration, the statute prevails”.
In closing, Ramsay J. observed that neither party argued Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65. She determined that she would follow the guidance set out in (i) Metropolitan Toronto Condominium Corporation No. 590 v. The Registered Owners and Mortgagees of Metropolitan Toronto Condominium Corporation No. 590 despite and (ii) 90 George Street Ltd. v. Ottawa-Carleton Standard Condominium Corp. No. 815. As a result of her analysis, Ramsay J. held that the arbitrator was required to be correct in his interpretation of the Condominium Act and his award on costs.
Following her analysis at paras 49-77, Ramsay J. dismissed the application.
“ Although the Arbitrator did not expressly state that the appellants were in breach of the Act, the Declaration and the Rules, it is implied in his analysis and his conclusion. The Arbitrator made no error in directing that the screens be removed and not be reinstalled without prior board approval. The appellants were in breach of the Condominium Act, the Declaration and the Rules”.
Costs (paras 79-83) – In the arbitration, MTCC had sought full indemnity costs in the amount of $34,386.84. Appellants submitted that no costs should be ordered or, if ordered, limited to $7,500.00. The arbitrator ordered Appellants to pay MTCC $16,000.00 in costs.
“MTCC relies on an email of the appellants as to what they anticipated the legal fees to amount to and submits, absent a finding that the costs were excessive or not within the reasonable contemplation of the parties, it was a fundamental error of law to reduce the quantum sought by MTCC 775. MTCC also relies on s. 131 of the Courts of Justice Act, the Rules of Civil Procedure and the jurisprudence on costs on the Rules to support its position on costs. No authority has been provided for the proposition that the Courts of Justice Act, the factors considered under rule 57.01 or the jurisprudence for matters commenced in the Superior Court of Justice are applicable to arbitration proceedings under the Arbitration Act. MTCC also argues that the scale of costs on a full-indemnity scale is warranted based on Articles II(2) and XIII(5) of the Declaration, By-Law No. 9 and Article I(13) of the Rules”.
Ramsay J. pointed out that agreement to arbitrate made no mention of costs and the Declaration made no mention of recovery of costs on “full indemnity scale”. Noting that section 54 of the Arbitration Act permitted legal costs as a component of costs awarded, she did comment that the Award’s reasons on costs were “sparse” and did not permit her to discern the scale on which they were awarded. As MTCC had acknowledged the arbitrator’s discretion and had participated in the argument on costs, she found no error in the costs award.
urbitral notes – First, see the reasoning from 90 George Street Ltd. v. Ottawa-Carleton Standard, 2015 ONSC 336 which lead to the court’s determination regarding the standard of review.
“ In my view, arbitration pursuant to the Condominium Act is distinguishable and very different from the arbitration of a commercial dispute.
 In a commercial arbitration, the parties are presumed to possess commercial knowledge and to have equal bargaining power. This presumption does not necessarily apply in a case where a dispute arises between the developer/owner/declarant and a condominium corporation where an imbalance of expertise and bargaining power may frequently exist.
 This imbalance is reflected in the statutory purpose of the Condominium Act. The Ontario Court of Appeal has noted that the purpose the Condominium Act is to provide consumer protection, as well as predictability and certainty to those purchasing a condominium, enabling them to make informed financial decisions (Lexington on the Green Inc. v. Toronto Standard Condominium Corp. No. 1930, 2010 ONCA 751, 102 O.R. (3d) 737 at paras. 49, 51 [Lexington]; Toronto Standard Condominium Corp. No. 2095 v. West Harbour City (I) Residences Corp., 2014 ONCA 724, 46 R.P.R. (5th) 1).
 While a condominium corporation is a legal “corporation,” this alone is not sufficient to deem it a commercial entity with expertise in the area of commercial or condominium law.
 The Boards of Directors of a condominium corporation are generally comprised of unit holders who may have very little or no expertise in condominium law and commercial transactions. On the other hand, developers of condominium projects who eventually become declarants usually have expertise in commercial matters and condominium law.
 For the above reasons I find that the Supreme Court’s decision in Sattva is distinguishable from the case at bar and that the standard of review of an arbitration award rendered pursuant to the Condominium Act is correctness.
 In the case before the Court, the arbitrator was required to be correct in his interpretation of s. 75 of the Condominium Act and in his awards of pre-judgment interest and costs, and the awards must be reviewed on this basis”.