Mediation and Arbitration

Mandatory Mediation and Arbitration

Some condo disputes must be resolved through mandatory mediation and arbitration instead of the Condominium Authority Tribunal or the courts.

Broadly speaking, these include disputes about:

Shared facilities agreements
First-year budgets
Governing documents issues outside the CAT’s jurisdiction
Changes to common elements by owners
Electric vehicle charging system installations.
And more

Condo by-laws may establish procedures for mediation and arbitration, which may vary from condo to condo.

Summary

Benefits of mediation and arbitration include confidentiality, customization, buy-in from all parties, speed and reduced costs.
The Condo Act requires that some types of disputes go through mandatory mediation and arbitration.
Some condos have by-laws that help guide the mediation and arbitration process.

On this page

What is the difference between mediation and arbitration?
What disputes must go to mediation and arbitration?
What is the mediation and arbitration process?
How does mandatory mediation work?
How does mandatory arbitration work?
Mediation and arbitration case studies

Four people discussing the terms of their mediation

Mediation is a collaborative and confidential process led by a neutral, third-party mediator who helps the parties work together to try to find a solution that works for everyone. Mediation can preserve relationships and help avoid lengthy and costly legal proceedings.

A group of people undergoing a formal arbitration

Arbitration is also confidential and led by a neutral third-party, but the arbitrator has a mandate to make a binding decision about the dispute. The arbitrator guides the process for how parties should present their case through a process that is less formal than the courts. The aim is to still find a resolution even if the parties can’t agree.

Disputes about agreements between specific parties

The agreements must be between the condo corporation and developers; the condo corporation and its management company; two or more condo corporations (e.g., shared facilities agreements); or the condo corporation and owners for alterations to common elements.

Disputes about first-year budgets between condo corporations and developers

Usually these budgets are handed over from the developer to the first owner-controlled board of directors.

Disputes about condo governing documents between condo corporations and owners

Some governing document disputes can go to the CAT. Everything else must go through mediation and arbitration. Some common examples are disputes about how owners must operate a business out of their unit, lease their unit, or how many people can stay in their unit.

Electrical vehicle charger installations between condo corporations and owners

These are considered changes to common elements that can be initiated either by an owner or the condo corporation.

See Section 132 of the Condo Act for a comprehensive list of issues that must go to mandatory mediation and arbitration. See an outline of the CAT’s jurisdiction.

Declarant obligations related to first-year budgets are found in section 75.

In this Ontario Superior Court of Justice case, the court found that the dispute was about the condo’s governing documents and ordered the parties to submit the case to mediation and arbitration.

1

Find a mediator while staying consistent with your condo's by-laws.

Mediators are not regulated and don’t require a licence to practise anywhere in Canada, but the ADR Institute of Canada sets informal standards, offers professional designations and provides contacts of individuals that can help guide those looking for mediation and arbitration services. Whomever you choose, make sure to speak with them directly to ensure they are available and have expertise in your issue.

Some condos have mediation by-laws that set mediator criteria and mediation procedures. These may include impartiality, not having conflicts of interest, as well as having experience and education requirements.

Keep in mind you or the other party can propose mediators, but all parties must agree on a chosen individual collectively.

Does your condo require specific forms for mediation? If not, use CAO’s optional Mediation Templates to help move mediation along.

Looking to create or update your condo’s by-law? Explore the CAO’s Core Components of a Mediation and Arbitration By-Law.

Here are some questions to consider when looking for a mediator:

1. Does the mediator have relevant qualifications?

2. Do they adhere to a code of ethics?

3. Does the mediator have experience in the condo sector?

4. When did they complete the CAO’s Director Training?

5. Is the mediator’s style the right fit for me to comfortably and fully participate?

6. How do they approach the confidential nature of the mediation process?

7. Does this fit my budget? What is the mediator’s fee structure? Will they require a retainer in advance of mediation and am I willing to pay it?

8. Is the mediator’s availability compatible with my schedule and timeline?

9. Does the mediator allow for participation methods, such as online and in-person sessions, that suit me? If the mediation will take place in-person, it can be important to consider where, as that may increase costs.

10. Is the mediator impartial? Have they worked with others involved in my dispute before?

11. Does the mediator have professional liability insurance to cover negligent acts, errors or omissions in the mediation process?

A common misconception involved in mediator selection involves focusing on a mediator’s settlement rate. A mediator can’t guarantee a settlement. It is best to focus on the recommended questions above instead.

How much does mediation cost?

Mediation is generally less expensive than the courts but can be affected by the mediator’s fees, if its conducted in-person, how long it lasts, if the mediator does a pre-evaluation of the dispute and what the legally required Mediation Settlement stipulates about cost-splitting between the parties.

Parties usually split costs equally, but must pay for their own optional legal representation.

Your condo’s by-laws may also govern how a mediator’s costs are covered.

Make sure to discuss fees ahead of time with your mediator.

2

Submit your dispute for mediation

Once you have identified the mediators you want, you can use our Notice of Submission to Mediation template to submit your intention to mediate along with your list of preferred mediators to the other party.

The other party can then respond using our Response to Notice of Submission to Mediation template.

If the parties can’t agree on a mediator during this exchange within 60 days, the dispute can move to arbitration.

If the parties agree, the mediator will begin scheduling the mediation.

3

During mandatory mediation

Your mediator will guide the process while impartially communicating with both parties and assisting in working towards a resolution. You should expect your mediator to create a safe space for dialogue. You should also expect that all discussions will remain confidential, including the terms of the settlement agreement unless otherwise specified.

In mediation, you control the outcome, and your mediator helps along the way. The only requirement in this regard for the mediator found in the Condo Act is that they make a written record of the outcome of mediation which can be done using our Mediation Report template.

What is discussed in mediation, stays in mediation.

Finding a mediator

Don’t know where to start looking? Visit our page on finding a mediator

Find a mediator

1

Finish mediation and prepare for arbitration

You can generally move your issue to arbitration 30 days after the mediator delivers a notice back to you and the other party indicating that mediation did not resolve the dispute.

Alternatively, you can also move to arbitration 60 days after you submitted the issue for mediation and you and the other parties were unable to agree on a mediator during that time.

Arbitrations are subject to the Arbitration Act, which covers the selection of an arbitrator, says that parties must not initiate a duplicate proceeding in the Ontario Superior Court of Justice and sets parameters around how arbitration costs and awards can be appealed. Several sections of the Arbitration Act can be waived, if the parties agree.

Legislative timelines that move a dispute to arbitration help prevent delays. You can still work together to settle the dispute until the arbitrator makes a decision.

2

Choose an arbitrator

Parties should attempt to agree on a chosen arbitrator. That individual then gains the authority to make a binding decision about their issue.

If there is no agreement on an arbitrator, an application can be made to the Superior Court of Justice to appoint one – adding cost and delay.

Condo by-laws can set out criteria or a procedure for arbitrator selection, which must be followed.

Whether you are following your by-laws, assessing the other party’s nomination, or looking for your own arbitrator, it may be helpful to consider the following questions:

1. Does the arbitrator have relevant qualifications?

2. Do they adhere to a code of ethics?

3. Does the arbitrator have experience with similar cases?

4. When did they complete CAO’s Director Training?

5. Does their style and process facilitate comfortable participation for me?

6. What will confidentiality mean in my arbitration?

7. How much will this arbitrator cost? Do they have cancellation fees or a retainer fee?

8. Will they be available at the right time to help resolve my issue?

9. Does the arbitrator allow for diverse participation methods that suit me, be it documents-only, online, hybrid, or in-person? Are there extra costs tied to doing the arbitration in-person?

10. Is the arbitrator impartial? Have they worked with others involved in this dispute before?

11. Does the arbitrator have professional liability insurance to cover negligent acts, errors or omissions in the mediation process?

12. How long will the arbitrator take to provide their decision?

How much will arbitration cost?

A condo’s by-laws may guide arbitration costs. Arbitrators will often require an initial retainer payment and request top-ups as needed over the course of the process. The length of the process may also affect costs.

Arbitration can be costly for the losing party in the end, and for all parties when it is ongoing.

In many cases, any party can pay the full cost of the arbitrator, and the arbitrator can re-allocate costs in their award. This helps to keep the process moving and prevents a party from delaying or withdrawing.

It is important to clarify exactly what your chosen arbitrator has the authority to decide. Make sure to capture this in writing with the other parties at the start of the process using the templates below or by following the process set out in your corporation’s by-laws.

3

During arbitration

The arbitrator appointed to your dispute is responsible for making sure the process is fair and impartial. They will ensure all parties have an equal opportunity to present their case, consider evidence, and issuing a binding decision. Unlike mediation, where the mediator may have private communications with only some of the parties, the arbitrator will communicate with all parties at the same time.

4

After arbitration

Arbitration is intended to end the dispute. Successful appeals of an arbitrator’s decision are typically limited and rare as the courts will typically defer back to the arbitrator.

If a party does not comply with the award, other parties can go to court for an order to enforce it. Having to do so risks compromising some of the confidential aspects of arbitration.

Finding an arbitrator

Don’t know where to start looking? Visit our page on finding an arbitrator

Find an arbitrator