A group of condo owners in Fort McMurray have written to Alberta’s premier and taken to social media saying they’re facing financial ruin due to a problem-plagued rebuild from the 2016 wildfire.
“There’s a lot of people considering bankruptcy, but there’s a fair number of people considering suicide as a way to get out,” said Becky Benoit, who along with her husband owns a condo in the Hillview complex.
Benoit and fellow condo owner Sheila Champion are among those leading a social media campaign to force a forensic audit of how owners became saddled with a pair of massive condo assessments, the most recent of which is due Nov. 15.
“I will not have $17,000 to give them,” Champion told Global News. “They’re not giving an extension and they’re not giving any kind of payment plan. So it’s like all or nothing by Nov. 15.
“We’re just left hung out to dry. It’s like someone keeps putting rocks in our pockets and then shoving us into the deep end of the pool.”
READ MORE: 2 years after wildfire, insurance frustrations flare up during Fort McMurray rebuild
Watch below: In May 2018, Fletcher Kent filed this report two years after a huge wildfire tore through Fort McMurray. Some say rebuilds of their homes have either stalled or not even begun.
Benoit said the condo board has also announced that fees are about to triple, rising $800 or $900 a month.
“Keep in mind this is for buildings that are not finished,” she said. “It’s not like we have snow to move and grass to cut; this is just to pay the legal fees to fight this battle against the developer and to pay for things like course of construction insurance.”
How did the Hillview condo owners’ problems start?
The May 2016 wildfire, dubbed “The Beast” by firefighters, forced the evacuation of the entire community of Fort Mcmurray and destroyed about 2,400 homes and other buildings. The condo complex owned by the Hillview Park Condominium Corporation is located in the Abasand neighbourhood, one of the communities hardest hit by the disaster.
She and her husband were renting out their condo at the time of the fire. They now live in Saskatoon with their children after the crash in oil prices saw them do stints in Calgary and Montana for work. Champion and her family were living in the condo up until the fire but also bounced around during the uncertain months after, first going to Stony Plain and eventually settling in Yellowknife where they had lived prior to moving to Fort McMurray.
The residents’ stories of financial hardship and transience since the wildfire are similar to many others whose lives were impacted by the blaze, but some Hillview condo owners say there’s a difference to their predicament: there’s no light at the end of the tunnel.
Benoit said the condo corporation’s insurance policy saw it get $77 million for the rebuild and the condo board quickly got the project out to tender, hiring Viceroy Construction, a contractor out of B.C.
She said she and her husband believed the rebuild was going well at first.
“Then, really without warning, the board announced that they had terminated Viceroy’s right to work on the project and they were going to hire someone else.”
Rework and massive assessment fees
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After the relationship between the condo board and Viceroy ended, the condo board said some work was going to have to be redone. That, and questions about the company hired to take over the project,? gave her pause about what was happening, Champion said.
“I really started asking a lot of questions… and then as things progressed, other people stepped up and said, ‘You know, you’re right.’ At first I was alone and now there’s 125 people in our group.”
Benoit said at that point, she “didn’t know what to think.”
According to her, the condo board asked owners to approve a proposal for it to pursue a loan to cover the rework. She said everyone voted for it, thinking that was better than trying to come up with cash payments themselves. Shortly thereafter, she said the condo owners got an assessment for about $6.9 million – the Benoits’ bill added up to $30,000.
“That was pretty horrific for us because we don’t qualify for any kind of Red Cross funding or any kind of help because we were considered investor owners,” Benoit said. “So if you didn’t live in the unit at the time that it burned, you don’t qualify for any help.”
Champion said many people who did live in the condos, however, were given assistance by the Red Cross or their personal insurance providers. But one person who owned three units didn’t qualify for any help and had to pay $90,000 on short notice and is now “substantially in arrears.”
“You’re kind of stuck right?” Champion said. “Because if you have a decent job, it’s definitely not worthwhile to file bankruptcy.
“You can’t just stop paying your condo fees and you can’t just not pay the assessment because they’ll come after you; they’ll put a caveat on your home and force foreclosure and then CMHC (Canada Mortgage and Housing Corporation) can come after you and there’s no end to the things that they can do… they can freeze your assets, garnish your wages… They kind of back you into a corner so you have nowhere to go.”
READ MORE: Mental-health struggles, depression linger after Fort McMurray wildfire: study
Last month, another assessment came in for about $3.7 million.
Complicating matters, the condo board and Viceroy are embroiled in a legal dispute and there are now liens on all the properties.
“There’s a 29-year-old (condo owner and)… this young man has done it all right,” Champion said. “He had his mortgage paid for, he was debt-free… And now he’s like, ‘I just want to give it away, get out from underneath it.’ And he can’t even do that. As long as there are liens on the property, he can’t even take his name off of it.
“So he’s just got to sit there and eat the assessments. It just breaks my heart.”
Champion and Benoit both want to see some type of independent audit of the decision-making process the board followed since the wildfire.
“We’re not construction workers; we don’t know anything about construction or financing or how these things work,” Benoit said. “All we want to know is where all the money went and who it went to.”
Global News reached out to the condo development’s property management firm, Alberta Condo Review & Management, for comment but has not received a response.
Global News has been unable to contact the condo board for comment, however, a condo owner verifiably messaged the board on behalf of Global News via an app only available to condo owners. Global News has yet to hear back.
Social media campaign and letter to the premier
Champion said she has been trying to raise awareness about the condo owners’ plight for the better part of a year now but has only recently begun gaining traction.
In October, dozens of Hillview condo owners posted an open letter to Premier Rachel Notley demanding she take some kind of action.
“My husband lost his job to the oil crash, our insurance has run out, we have liquidated all our RRSPs and savings and maxed out our credit trying to keep going,” part of the letter reads.
“As of today, we have spent all our savings,” reads another. “We’ve had to take money from our kids’ school investments and more to try and keep up. We have four children and are at a loss what to do next.”
“This rebuild has drained us of every ounce of hope and finances,” reads yet another.
Champion said she had previously reached out to Notley and received a response from the premier’s office saying nothing could be done, and offering links to mental health help.
A spokesperson said the premier is “aware of the untenable situation that Hillview condo owners in Fort McMurray are currently facing and she will be responding to their letter.”
“Our hearts go out to residents of Hillview Condos, who have already suffered an incredible loss and are now faced with the stress of trying to come up with payments that for many will have a direct impact on their quality of life,” Cheryl Oates said in an email. “Our government is providing immediate health supports to condo owners as they deal with these mounting challenges.
“Additionally, the courts have appointed an administrator to oversee decisions by the condo board and has the authority to continue or terminate all agreements.”
Benoit said she realizes the provincial government does not have a “magical pot of money” to “sweep in and pay for everything” but she still wants a more robust response.
READ MORE: Hundreds of Fort McMurray residents in areas hit hardest by wildfire finally allowed to go home
Watch below: Aerial footage taken from above Fort McMurray, Alta. in May 2016 looks at the destruction in the Abasand and Beacon Hill neighbourhoods. The video was taken just days after more than 80,000 people were forced from their homes due to a raging wildfire.
Champion said she believes the government can offer more financial assistance.
“I’m going to keep pressing the issue because corporations are bailed out of situations all the time,” she said.
Alberta’s Condominium Property Act
Champion told Global News she believes the Hillview owners’ situation highlights the need for changes to Alberta’s Condominium Property Act.
“Until the condo act is changed to protect owners, they’re at risk. Because condo associations or condo boards can levy assessments and without a lawyer, you can’t fight.
“I will never buy another condo.”
READ MORE: Alberta introduces rules around sale, deposits on new and converted condos
Watch below: In 2017, Vinesh Pratap filed this report about Alberta introducing new rules with the hope of protecting people who want to buy a new condo.
Laurie Kiedrowski specializes in condominium law at McLeod Law LLP in Calgary. She said she has no involvement in the Hillview case but has read about it in the media.
“Every time I see stories like this, all I can think about is how heartbreaking and devastating it is for owners who find themselves in this situation,” she said. “We see it not only in instances of catastrophic loss, like this one in Fort McMurray, but we also see it in instances of poorly constructed buildings.”
Condo boards are obligated to comply with the Act, Kiedrowski said.
“It places upon these board members a duty to control, manage and maintain the property of the corporation. If the boards of directors neglect to do so, they can be subjected to personal liability for non-compliance with the act.
“And, if they’re not discharging their duties in accordance with the requirements of the Condominium Property Act, it’s questionable whether or not their directors’ and officers’ liability insurance would cover them if this came back to them in the future for not undertaking the appropriate repairs.”
Kiedrowski said it’s in everyone’s best interest for condo boards to be transparent.
“Whenever we find corporations in situations like this, our advice is always to be open and honest and to disclose to the owners as much information as they can, so that nothing comes as a surprise and so the owners don’t feel like the wool is being pulled over their eyes. It’s important that the owners understand how the corporation got to this place and what needs to be done to remedy it.
“The Condominium Property Act, specifically Section 44, provides that boards of directors shall provide information upon request and there’s a list of enumerated items that are required, including board meeting minutes — through which these decisions would have been discussed, past AGM minutes… and town hall meetings.”
“We want changes to the Condo Act,” Benoit said. “It is a terrible piece of legislation that in no way protects owners or gives them any right to anything.
“There should be lessons learned from this disaster.”
The future
Benoit said she is raising awareness about the Hillview owners’ plight out of a sense of duty to warn others, however, she and her husband have already decided to declare bankruptcy.
“We have no choice,” she said. “What are we going to do? We can’t sell these units, we can’t wait, now they’re saying they won’t be finished until August 2019 and that’s fairly optimistic. We don’t have the time to wait until they’re rebuilt and continue to pay our mortgages and continue to pay these massive condo fees or scrape up the money for these assessments if we can. None of our banks will give us any more money.
“And even if we manage to do that, what are we going to be left with? … Condos with a terrible reputation that can’t be sold.”
Champion said she believes the stress of the rebuild, combined with the blowback she faced after she went public with what the Hillside owners are facing, led her to have a stroke in April. She and her husband don’t anticipate they’ll have the money to pay their share of the condo assessment on Nov. 15 and she expects a caveat will be put on her mortgage after 30 days of no payment. Then she expects a foreclosure.
“There’s no way out.”
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