Owner developer's control of strata corporation

5   (1) The owner developer must exercise the powers and perform the duties of a council from the time the strata corporation is established until a council is elected at the strata corporation's first annual general meeting.

(2) In exercising the powers and performing the duties of a council, the owner developer need not comply with bylaw requirements respecting the constitution of the council or the holding or conduct of council meetings.

Owner developer's standard of care

6   (1) In exercising the powers and performing the duties of a council, the owner developer must

(a) act honestly and in good faith with a view to the best interests of the strata corporation, and

(b) exercise the care, diligence and skill of a reasonably prudent person in comparable circumstances.

(2) Without limiting subsection (1), the owner developer must make reasonable efforts to pursue any remedies under warranties in existence with respect to the construction of the common property and common assets.

(3) Sections 32 and 33 do not apply to an owner developer exercising the powers and performing the duties of the council, as long as the owner developer complies with subsection (1) of this section.

Owner developer to pay expenses

7   The owner developer must pay the actual expenses of the strata corporation that accrue in the period up to the last day of the month in which the first conveyance of a strata lot to a purchaser occurs.

Passing resolutions before first conveyance

8   Before the first conveyance of a strata lot to a purchaser, the owner developer may pass any resolution of the strata corporation permitted or required by this Act or the regulations, including a resolution to amend the strata corporation's bylaws under section 127, without holding a special general meeting.

Owner developer may be restricted

9   In exercising the powers and performing the duties of a council after the first conveyance of a strata lot to a purchaser, the owner developer is subject to a direction or restriction under section 27 as if the owner developer were a council.

Restriction on contracting powers

10   In the period after the first conveyance of a strata lot to a purchaser but before the first annual general meeting, no contract or transaction may be entered into by or on behalf of the strata corporation with either the owner developer or a person who is not at arm's length to the owner developer, unless the contract or transaction is approved by a resolution passed by a unanimous vote at a special general meeting.

Passing resolutions after first conveyance

11   In the period after the first conveyance of a strata lot to a purchaser but before the first annual general meeting, the strata corporation may pass a resolution requiring a 3/4 vote as follows:

(a) for a resolution to amend the bylaws under section 127 (2) or (4) (b), the resolution may be passed in accordance with section 127 (2) or (4) (b), as applicable;

(b) [Repealed 2022-41-6.]

(c) for any other resolution requiring a 3/4 vote, the resolution must be passed by a unanimous vote at a special general meeting.

Owner developer to establish contingency reserve fund

12   (1) At the time of the first conveyance of a strata lot to a purchaser, the owner developer must establish a contingency reserve fund by paying into the fund an amount calculated according to this section.

(2) If the first conveyance of a strata lot to a purchaser occurs no later than one year after the deposit of the strata plan, the minimum contribution to the fund must be the prescribed percentage of the estimated operating expenses as set out in the interim budget referred to in section 13.

(3) If the first conveyance of a strata lot to a purchaser occurs later than one year after the deposit of the strata plan, the minimum contribution to the fund must be the lesser of

(a) the prescribed percentage of the estimated annual operating expenses as set out in the interim budget referred to in section 13 multiplied by the number of years or partial years since the deposit of the strata plan, and

(b) the prescribed percentage of the estimated annual operating expenses as set out in the interim budget referred to in section 13.

(4) The owner developer must not use money in the contingency reserve fund to pay strata corporation expenses.

(5) The contingency reserve fund belongs to the strata corporation.

Interim budget following first conveyance

13   (1) The owner developer must

(a) prepare an interim budget for the strata corporation for the 12 month period beginning the first day of the month following the month in which the first conveyance of a strata lot to a purchaser occurs, and

(b) deliver a copy of the interim budget to each prospective purchaser of a strata lot before the prospective purchaser signs an agreement of purchase and sale.

(2) The interim budget must include

(a) the estimated operating expenses of the strata corporation for the 12 month period,

(b) the contribution to the contingency reserve fund for the 12 month period, which must be at least the prescribed percentage of the estimated operating expenses, and

(c) each strata lot's monthly share of the estimated operating expenses and contribution to the contingency reserve fund, calculated in accordance with section 99.

Payments during period of interim budget

14   (1) The strata corporation must pay the expenses that accrue in the period beginning the first day of the month following the month in which the first conveyance of a strata lot to a purchaser occurs until the date the first annual budget takes effect.

(2) During the period referred to in subsection (1), the owners must pay to the strata corporation, each month, their monthly share of the estimated operating expenses of the strata corporation and contribution to the contingency reserve fund as set out in the interim budget.

(3) The strata corporation must not use money in the contingency reserve fund to pay expenses that accrue before the owners approve the first annual budget.

(4) Subject to subsection (5), if the expenses accrued by the strata corporation, for the period referred to in subsection (1), are greater than the operating expenses estimated in the interim budget for that period, the owner developer must pay the difference to the strata corporation within 8 weeks after the first annual general meeting.

(5) If the accrued expenses referred to in subsection (4) are 10% or more greater than the operating expenses estimated in the interim budget for that period, the owner developer must include in the payment referred to in subsection (4) an additional amount calculated according to the regulations.

(6) If the expenses accrued by the strata corporation, for the period referred to in subsection (1), are less than the operating expenses estimated in the interim budget for that period, the strata corporation must refund the difference to the owners in amounts proportional to their contributions.

(7) Despite subsection (6), if no owner is entitled to receive more than $100 in total under subsection (6), the strata corporation may deposit the difference in the contingency reserve fund.

(8) If no budget is approved at the first annual general meeting, the period referred to in subsections (4), (5) and (6) ends at the first annual general meeting.

Minimum period of insurance coverage

15   The owner developer must ensure that the term of any insurance policy entered into by or on behalf of the strata corporation continues for at least 4 weeks after the first annual general meeting.

First annual general meeting to be held by owner developer

16   (1) The owner developer must hold the first annual general meeting during the 6 week period that begins on the earlier of

(a) the date on which 50% plus one of the strata lots have been conveyed to purchasers, and

(b) the date that is 9 months after the date of the first conveyance of a strata lot to a purchaser.

(2) The owner developer must give notice of the meeting in accordance with section 45 and must include with the notice the budget and financial statement referred to in section 21.

Owners may hold first annual general meeting

17   If the owner developer does not hold the first annual general meeting as required by section 16,

(a) an owner may hold the first annual general meeting after giving notice in accordance with section 45 to the persons referred to in section 45 and to the owner developer, and

(b) the owner developer must pay to the strata corporation an amount calculated according to the regulations.

Money owed by owner developer

18   Amounts payable by the owner developer under sections 14 (4) and (5) and 17 (b) are money owing to the strata corporation, and sections 112 to 118 apply.

Chair of first annual general meeting

19   The chair of the first annual general meeting is

(a) the owner developer acting personally or through an agent, or

(b) if the owner developer or the agent is unwilling or unable to act as chair, an individual elected by eligible voters who are present in person or by proxy at the meeting.

Business at first annual general meeting

20   (1) At the first annual general meeting, the eligible voters must elect a council, for a term of one year, in accordance with section 25.

(2) At the first annual general meeting, the owner developer must

(a) place before the meeting and give the strata corporation copies of all of the following:

(i) all plans that were required to obtain a building permit and any amendments to the building permit plans that were filed with the issuer of the building permit;

(ii) any document in the owner developer's possession that indicates the actual location of a pipe, wire, cable, chute, duct or other facility for the passage or provision of systems or services, if the owner developer has reason to believe that the pipe, wire, cable, chute, duct or other facility is not located as shown on a plan or plan amendment filed with the issuer of the building permit;

(iii) all contracts entered into by or on behalf of the strata corporation;

(iv) any disclosure statement required by the Real Estate Development Marketing Act;

(v) the registered strata plan as obtained from the land title office;

(vi) names and addresses of all contractors, subcontractors and persons who supplied labour or materials to the project, as required by the regulations;

(vii) all warranties, manuals, schematic drawings, operating instructions, service guides, manufacturers' documentation and other similar information respecting the construction, installation, operation, maintenance, repair and servicing of any common property or common assets, including any warranty information provided to the owner developer by a person referred to in paragraph (vi);

(viii) all records required to be prepared or retained by the strata corporation under section 35;

(ix) any other records required by the regulations, and

(b) place an annual budget, prepared in accordance with section 21, before the meeting for approval.

(3) If the owner developer contravenes subsection (2) (a) and the strata corporation must pay money to obtain a document referred to in that provision, the amount of the payment is money owing to the strata corporation by the owner developer, and sections 112 to 118 apply.

First annual budget requirements

21   (1) The first annual budget must be for the 12 month period beginning on the first day of the month following the date of the first annual general meeting.

(2) The first annual budget must be distributed with the notice of the first annual general meeting under section 45 and must be accompanied by a financial statement.

(3) The budget and financial statement

(a) must contain the information required by the regulations, and

(b) may be in the form set out in the regulations.

(4) Approval of the first annual budget must be by a resolution passed by a majority vote.

(5) The proposed budget may be amended by a majority vote at the first annual general meeting before the budget itself is put to a vote.

(6) Within 8 weeks after the first annual general meeting, the owner developer must give the strata corporation a financial statement updated to

(a) the date the first annual budget takes effect, or

(b) if no budget is approved at the first annual general meeting, the date of the first annual general meeting.

Transfer to council

22   Within one week after the first annual general meeting, the owner developer must

(a) transfer control of the strata corporation's money to the newly elected council, and

(b) deliver to the newly elected council any keys, garage door openers or other means of access that the owner developer possesses for the purposes of exercising the powers and performing the duties of the council.

Access to owner developer's financial records

23   (1) For 2 years following the transfer of control referred to in section 22, the owner developer must keep all financial records that relate to the strata corporation's finances during the period before the transfer of control.

(2) During the 2 years that the owner developer keeps the financial records,

(a) the owner developer must, at the request of the strata corporation, make them available for inspection free of charge by the strata corporation, and

(b) the strata corporation may, at its expense, copy or audit them.

Strata management contracts

24   (1) A contract entered into before the first annual general meeting by or on behalf of the strata corporation for the provision of strata management services to the strata corporation ends, regardless of any provision of the contract to the contrary, on the earlier of

(a) the date that is 4 weeks after the date of the second annual general meeting,

(b) the termination date contained in the contract or agreed to by the parties, and

(c) the cancellation date established in accordance with section 39.

(2) The strata corporation may, by a resolution passed by a majority vote at the second annual general meeting, continue a contract which would otherwise end under subsection (1) (a).

(3) A resolution under subsection (2) does not require notice under section 45 (3).