FEES AND FINANCES

Special Assessments

A special assessment is an extra one-time charge added to the owners’ common expenses fees that condo corporations may use to cover shortfalls in their yearly budgets. Corporations generally rely on special assessments to cover single events that impact their finances, such as being involved in expensive litigation.

Summary

A special assessment is an extra one-time charge added to the owners’ common expenses fees.
The governing documents of the condo corporation may have provisions regarding special assessments.
An owner’s portion is calculated using the same percentage used to calculate common expenses fees.

On this page

Understanding Special Assessments
How much does an owner pay?
Avoiding Special Assessments

Understanding special assessments

Condo boards can charge a special assessment through common expense fees without getting permission from owners. The governing documents of the condo corporation may have provisions regarding special assessments which the condo corporation will have to abide by.

Your condo board may need to levy a special assessment for a variety of reasons. Here are some notable examples:

Unforeseen expenses

The condo corporation incurs a major unexpected expense, such as if a major piece of equipment needs to be replaced earlier than expected.

Under-budgeting

When a previously budgeted expense ends up costing more than expected. For example, a major repair that exceeds its budgeted amount.

Litigation

The condo corporation may need to levy a special assessment to pay the legal fees or costs.

How much does an owner pay?

Condo corporations will tell owners how much they must pay. An owner’s portion is calculated using the same percentage used to calculate common expenses fees. Owners must pay their portion of any special assessments. Not paying will lead to the corporation having a lien against your condo unit. The lien will cover the unpaid amount owing, all interest as well as all reasonable legal costs and expenses incurred by the condo corporation in its attempt to collect the unpaid amounts.

A lien is a legal right or claim against a person’s property by an entity to whom they owe money. For example, a condo corporation may be able to seize an owner’s condo unit and sell it so they can recoup any amounts they are owed if an owner does not pay their portion of the common expenses.

Check our page on liens for more information.

Avoiding special assessments

Ultimately, the best way to avoid special assessments is sound financial management of the condo corporation. The Condo Authority provides many resources that can help with financial management! See below.

A recent Superior Court of Justice decision found that a condo buyer who purchased a unit in a Waterloo condo was exempt from paying their portion of a special assessment because the condo corporation had not clearly disclosed that it might need to levy assessments on owners in their status certificate.