The Pandosy Street condo complex.

Image Credit: Google Street View

January 12, 2023 – 7:41 AM

A Kelowna man has lost out on an opportunity to use his condo as a vacation rental because his strata refused to sign the paperwork he needs to get a permit from the city.

While Michael William Mudrie’s Pandosy Street condo complex had no bylaws prohibiting vacation rentals he did need a consent form from the strata to give to the City so he could get a business permit.

However, the strata refused to sign the form saying having vacation rentals in the building would increase the price of insurance.

Mudrie then took Strata KAS 1993 to the Civil Resolution Tribunal seeking an order that the strata sign his consent form.

READ MORE: B.C. strata lose legal case deciding if inflatable hot tub is ‘furniture’

According to a Jan. 9 Civil Resolution Tribunal decision, he argued he’d been treated “significantly unfairly” by the strata for refusing to sign the form.

In 2019, the City of Kelowna passed a bylaw requiring anyone who lets a unit as a vacation rental needs to have a business licence. Those who live in a strata also need a letter of consent.

In the decision, Mudrie argued as the strata have no bylaws against vacation rentals the strata is obliged to sign the letter of consent.

However, the Tribunal doesn’t see it like that.

“I find his expectation is that in the absence of a strata bylaw specifically prohibiting (short-term accommodation), the strata is obligated to sign the city’s consent form so that he can obtain a business license to operate short-term accommodation in his strata lot,” the Tribunal said. “However, I find Mr. Mudrie’s expectation is not objectively reasonable. While there is no bylaw expressly prohibiting short-term accommodations in the strata, there is also no bylaw specifically permitting them.”

The Tribunal goes on to say that just because the “bylaws are silent” on vacation rentals doesn’t mean that the strata is obligated to approve and facilitate them.

“It could be that the strata had simply not considered the issue before. So, I find it was not reasonable for Mr. Mudrie to expect the strata to immediately sign the consent form without considering the potential effects of that decision,” the Tribunal ruled.

READ MORE: B.C condo owner fined $17,000 wins case against strata over Airbnb

The strata said the potential effect of allowing short-term rentals is an increase in its insurance costs.

The strata submit evidence from its insurance broker, which said if the strata allow vacation rentals it “could see” a 20 per cent increase in its premium.

Mudrie said it should sign the letter because it previously gave him verbal permission to operate a vacation rental.

However, the Tribunal finds he hasn’t proved this and sides with the strata who deny it.

Mudrie said he made $14,000 in 2021 after the strata gave him verbal permission that year and he needs the cash as he lives on a low-income pension and has medical issues that make it difficult for him to afford his mortgage without the vacation rental income.

Again, the Tribunal wasn’t swayed.

“Mr. Mudrie did not provide any financial or medical evidence and there is no evidence he advised the strata of these issues,” the Tribunal ruled.

“Overall, I find Mr. Mudrie has not established the strata’s decision to not sign the consent form was burdensome, harsh, wrongful, lacking in probity or fair dealing, done in bad faith or was unjust or inequitable,” the Tribunal ruled dismissing his case.

While the Tribunal found the strata had done nothing wrong, the situation still leaves Mudrie potentially $14,000 out of pocket.

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