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Status Brief

Offer night

Waiving the status certificate condition

In a bidding war, a conditional offer usually loses. So the status certificate arrives with the offer deadline, the condition gets waived, and the package that was supposed to be read over five days gets read in an evening, if at all. Here is how the condition normally works in Ontario, what waiving it gives up, and what to read first in the time you have. General information, not legal advice.

How the condition normally works

Anyone can ask a condominium corporation for a status certificate. The corporation has 10 days from the request and the fee to provide it, and it cannot charge more than $100, taxes included.

The standard condition in an Ontario agreement of purchase and sale gives the buyer until 5 p.m. on the fifth business day after receiving the certificate and its attachments. If the buyer, usually through their lawyer, does not confirm in writing that they are satisfied, the deal is off. The condition exists for the buyer, and the buyer can waive it.

Waiving it means agreeing to buy whatever the package says. An assessment, a lawsuit or a reserve fund in trouble stops being a reason to walk away and becomes something you own.

Why the package shows up late

Because the corporation can take ten days, a careful listing agent orders the certificate before the unit goes on the market and makes it available to buyers so they can offer without the condition. Many buyers never ask for it, and the ones who do are handed a package that often runs well past a hundred pages.

The advice from lawyers and agents is the same: have a lawyer review it before you offer, not after. That is the right answer when you can get one. When it is Sunday night and offers close at 7 p.m. tomorrow, the list below is where to start.

If you have an hour, read these first

In this order. The paragraph numbers are from the standard Ontario form, so they are the same in every certificate.

  1. 01

    Arrears or a lien on the unit

    Paragraph 5

    Look forAny amount the owner is behind on, or a certificate of lien registered against the unit.

    Unpaid common expenses give the corporation a lien on the unit that can rank ahead of a mortgage (Condominium Act, 1998, s. 86). It is registered against the unit, not the owner.

  2. 02

    Special assessments

    Paragraph 11

    Look forEach assessment levied since the budget, this unit's share, and whether that share is paid.

    An assessment means the corporation needed more money than its budget or reserve fund provided. If this unit's share is not paid, settle whose it is before you commit.

  3. 03

    Paragraph 12, the catch-all

    Paragraph 12

    Look forEverything written after the word “except”.

    This is where the corporation discloses anything it knows of that may push common expenses up: planned repairs, loans, an assessment being discussed.

  4. 04

    The reserve fund against its plan

    Paragraphs 13 to 17 and the funding notice

    Look forThe balance and its date, the balance the plan projects for this year, and the date of the last reserve fund study.

    A fund well behind its plan, or a study more than three years old, is the kind of gap that later turns into higher fees or an assessment.

  5. 05

    Lawsuits

    Paragraph 19

    Look forWhether the corporation is the one being sued, for how much, and whether its insurer is defending.

    What insurance does not cover, the corporation pays, and owners fund the corporation.

  6. 06

    The water damage deductible

    The insurance certificate

    Look forThe deductible for water damage, and any by-law that makes owners responsible for it.

    When damage starts in your unit, you can be charged the lesser of the deductible and the repair cost (s. 105). Check your own policy covers that amount.

  7. 07

    Rules that would stop you

    The declaration and the rules

    Look forPets, renting the unit out, short-term rentals, and what you can change inside the unit.

    None of these are money, but any of them can make the unit wrong for you, and they are much harder to change than a fee.

The full list, with the other 23 checks, is on the status certificate red flags page.

Or have every page read before the deadline.

Upload the package as it came. Status Brief reads every page, scans included, and gives you the findings in the order above, each with the page it came from. Most packages take 3 to 5 minutes. $19 per package, and checking the file first is free.

Upload the packageSee a sample brief

This page is general information about the standard Ontario form and the usual condition. It is not legal advice, and a brief is not a lawyer's review. If you can reach a lawyer before you offer, do.

Sources: Condominium Authority of Ontario, “Status certificate”; Cheadles LLP, “Condominium status certificates”; Move Smartly, “How to protect yourself when making unconditional offers” (2018); Condominium Act, 1998, ss. 76, 86 and 105.