omnicare pharmacy ltd. v. the owners, strata plan lms2854

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  1. 1. IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Omnicare Pharmacy Ltd. v. The Owners, Strata Plan LMS 2854, 2017 BCSC 256 Date: 20170220 Docket: S164895 Registry: Vancouver Between: Omnicare Pharmacy Ltd. Petitioner And: The Owners, Strata Plan LMS 2854 Respondent Before: The Honourable Madam Justice Adair Reasons for Judgment Counsel for the Petitioner: V.H. Stewart Counsel for the Respondent: A.C. Breen Place and Date of Hearing: Vancouver, B.C. November 18 and 23, 2016 Place and Date of Judgment: Vancouver, B.C. February 20, 2017
  2. 2. Omnicare Pharmacy Ltd. v. The Owners, Strata Plan LMS 2854 Page 2 1. Introduction......................................................................................................... 2 2. Background......................................................................................................... 5 (a) Carrall Station.............................................................................................. 5 (b) The formation of the Strata Corporation in July 1997 .................................. 5 (c) The Bylaws .................................................................................................. 6 (d) Omnicares business and customers......................................................... 11 (e) The Strata Corporation asserts Omnicare is in breach of various bylaws, and levies fines..................................................................................................... 18 (i) Breach of bylaw 5.7................................................................................ 19 (ii) Breach of bylaw 5.1................................................................................ 19 (iii) Breach of bylaws 45.1, 46.3, 5.1 and 5.7............................................... 20 (iv) Breach of bylaws 5.1 and 5.7................................................................. 20 (v) Breach of bylaws 5.1, 45.1, 51.1 and 51.6............................................. 21 (vi) The Strata Council levies five fines, totalling $1,000.............................. 22 (f) Request to add a security gate for Unit 130 .................................................. 22 (g) Events after the Petition was filed.............................................................. 24 3. Discussion and analysis.................................................................................... 25 (a) Are the Current Bylaws valid? ................................................................... 26 (b) The Nuisance Bylaw.................................................................................. 32 (c) Has the Strata Corporation treated Omnicare in a manner that is significantly unfair?............................................................................................... 34 4. Summary and disposition.................................................................................. 41 1. Introduction [1] The petitioner, Omnicare Pharmacy Ltd., is the owner of three ground-level, nonresidential strata lots in an 8-storey building located at 1 East Cordova Street in Vancouver, at the corner of East Cordova and Carrall Streets. The building is known as Carrall Station, and is in the area known as the Downtown Eastside. The vast majority of strata lots in Carrall Station are residential. [2] Since 2000, Omnicare has operated a pharmacy (the Pharmacy) from one of its strata lots, Unit 130. The Pharmacy is open 7 days a week, 365 days a year. Among other things, the Pharmacy dispenses maintenance methadone by
  3. 3. Omnicare Pharmacy Ltd. v. The Owners, Strata Plan LMS 2854 Page 3 prescription. Mr. Harvey Chan, a licensed pharmacist and Omnicares president, estimates that Omnicare serves, on average, about 200 customers a day, many or most of whom live in the neighbourhood. [3] For many years, the operation of the Pharmacy has created considerable friction between Omnicare and Carrall Stations strata council. In 2009, Omnicare commenced legal proceedings against the Strata Corporation, asserting (among other things) that the Strata Corporation was treating Omnicare in a manner that was significantly unfair. Those proceedings ultimately were settled by a consent order in 2011. [4] However, beginning in December 2015, the Strata Corporation (through its property manager) sent a series of letters to Omnicare asserting that Omnicare was in breach of various bylaws. Many of the alleged breaches related to what was asserted to be the conduct of individuals who were said to be customers of the Pharmacy. Ultimately, the Strata Corporation levied a total of $1,000 in fines against Omnicare. [5] Omnicare now applies for the following relief: (a) a declaration that the Strata Corporations bylaws are invalid, and that the standard bylaws under the Strata Property Act, S.B.C. 1998, c 43, are the only bylaws that apply; (b) alternatively, an declaration that Omnicare has not breached the bylaws under which the Strata Corporation has levied fines against Omnicare; (c) a declaration that the Strata Corporation has treated Omnicare in a manner that is significantly unfair, contrary to s. 164 of the Strata Property Act, by knowingly relying on invalid bylaws to make complaints and assess fines against Omnicare and by refusing unreasonably to permit Omnicare to install a security gate outside its exterior business door;
  4. 4. Omnicare Pharmacy Ltd. v. The Owners, Strata Plan LMS 2854 Page 4 (d) an order cancelling all fines assessed against Omnicares strata lot; (e) an injunction restraining the Strata Corporation, its agents and representatives, from further conduct that constitutes harassment of, and interference with, Omnicares business, its employees and representatives and customers; and (f) an order permitting Omnicare to install a security gate on the exterior of the door of Unit 130. [6] The Strata Corporation says that the petition should be dismissed. [7] The Strata Corporation acknowledges that its bylaws were not passed in compliance with the requirements of the legislation. However, the Strata Corporation says that the failure to comply is merely technical, not substantive, and the court should therefore exercise its discretion to uphold the validity of the bylaws. In addition, the Strata Corporation says that Omnicare has allowed too much time to go by without challenging the validity of the bylaws, and a declaration of invalidity after so many years would be prejudicial to the Strata Corporation. The Strata Corporation says that the fines issued against Omnicare were justified in the circumstances and made with the best interests of the other owners in mind. [8] The Strata Corporation denies that it has treated Omnicare in a manner that is significantly unfair. Rather, it says that it has acted reasonably, and in accordance with its statutory obligations, by taking action against Omnicare for its failure to address issues relating to its business that have affected other strata owners. The Strata Corporation says that the decision not to permit Omnicare to install a security gate is justified, and, further, that Omnicare has failed to make out any basis for the injunction requested.
  5. 5. Omnicare Pharmacy Ltd. v. The Owners, Strata Plan LMS 2854 Page 5 2. Background (a) Carrall Station [9] The Strata Corporation consists of eight nonresidential strata lots and 74 residential strata lots, together with common and limited common property. [10] All of Carrall Stations nonresidential units are at ground level. [11] In addition to Omnicares three strata lots, only one other nonresidential strata lot is used as commercial space (a restaurant). The other four nonresidential strata lots are used as residential units. This includes the unit occupied by Mr. Victor Paquette. Mr. Paquette sits on the Strata Council as the single designated representative (under the challenged bylaws) of the nonresidential owners. (b) The formation of the Strata Corporation in July 1997 [12] The Strata Corporation came into existence in July 1997, by deposit and registration of strata plan LMS 2854 in the Land Title Office. [13] Concurrently with registration of the strata plan, an easement agreement between the City of Vancouver and Carrall Stations developer was also registered. By the easement agreement, Carrall Station was permitted to partially encroach on City property, including approximately one foot from the exterior walls of the building onto the sidewalk along the length of the building on East Cordova and Carrall Streets. Under the easement agreement, the Strata Corporation is responsible for ensuring that the area covered by the easement is maintained in a safe condition and in good repair, and kept in a reasonably neat and clean condition at all times. The easement agreement also requires the Strata Corporation to maintain insurance, so that if any of the encroachments cause damage or injury to others, the Strata Corporation, and not the City, will be responsible for it. [14] No survey is in evidence, and the opinions expressed by the Strata Corporations witnesses about the meaning and effect of the easement agreement are inadmissible.
  6. 6. Omnicare Pharmacy Ltd. v. The Owners, Strata Plan LMS 2854 Page 6 [15] I find that the easement agreement does not give the Strata Corporation any ownership interest in the areas subject to the agreement, and does not convert any of those areas into common property. (c) The Bylaws [16] Also in July 1997, the Strata Corporation filed notification of its adoption of the bylaws set out in the Condominium Act, R.S.B.C. 1996, c. 64, as amended by Schedule A attached to the filing. I will refer to these bylaws as amended by Schedule A as the Original Bylaws. [17] Among other things, the Original Bylaws provided as follows: (a) with respect to the Strata Council: the Strata Council was to consist of not less than 3 and not more than 7 persons; not less than one quarte