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Are lessees subsidizing Westsea Construction?

Update 2 January 2020: Developments regarding financial disclosure are reported on this site’s new page, “$ disclosure refused by Westsea”:   https://orchardhouseleaseholder.ca/disclosure-refused-by-westsea/

Because no disclosure is required in the long-term residential lease that our landlord drafted to his own advantage back in 1974, we lessees at Orchard House wonder if we are subsidizing the landlord. The same applies to the other nine leases identical to ours, the standard-form nature of which was declared by the B.C. Court of Appeal in May of 2020.

Let’s start with the annual budget; we don’t get one. A simple question or two that I once put to the company about spending in the upcoming year were dismissed in writing by the company’s lawyer as “inappropriate”. No, I’m not kidding.

In May or June of each year we receive a past-year statement of operating costs with a one-page list of expenses and, most years, the amount we owe in addition to last year’s monthly suite fees to cover all of the costs. In May of 2019, for example, we were told that the “shortfall” for 2018 was $495,690, so lessees were told to pay three monthly payments ranging from $564 to $1,112. No total was given, but if we chose to do the math and pay the “shortfall” at once, that ranged from $1,692 to $3,336 depending on suite size. This expense was on top of monthly fees that had already increased 38% over 2017.

Westsea’s lawyer boastfully tells judges that our finances are “audited”, but little good a one-page statement does us, as we have no idea what’s included in a line item only identified as “legal” at $454,000, or “accounting and administrative costs” at $63,000, nor “salaries and employee benefits” at $85,229. Since my innocuous questions about these statement line items were “inappropriate”, I should move on to more fundamental questions, such as:

  • Are the 16 suites to which Westsea itself holds the lease assignments and rents out 13 for revenue paying their share of the building operating expenses and lump-sum capital costs, such as for new windows? (There are two managers’ suites and an owner’s suite that appears to remain vacant.)
  • Are lessees paying the site managers to operate Westsea’s rental suites and perhaps even for advertising or in-suite repairs?
  • Westsea provides no visitor parking, but by my count retains 34 parking stalls that it can assign at will or rent out for revenue. Yet Orchard House costs are paid by suite lessees, nothing by parking stalls, so I suppose that lessees paid for the cost of the new roof, sod and sprinkler system atop that parking, as well as the annual garage cleaning, property tax and regular lawn cutting.
  • Do the above-mentioned accounting and administrative costs include head-office operations for Westsea? Where do Orchard House-specific operating costs end, and Westsea’s own business expenses start? Does Westsea’s business run with no costs to itself whatsoever? Does “bill the lessees; they won’t know” apply, because we certainly don’t know.

That last point reminds me that Justice Douglas somehow came to believe that our lease includes a clause allowing Westsea to bill lessees “management costs”. On this point see my article “Don’t believe it!” How did Madam Justice Douglas come to read into our lease a non-existent clause? The court record on this has since been corrected.

More questions about our money could be asked, some substantial, some more minor. But obviously lessees deserve to know more about where their money is going, which point MLA Carole James raised with me as a specific concern of hers when last I chatted with her.

Yes, we could undertake legal action, similar to what lessee Hugh Trenchard did in 2014, to see if the court would require the company to open its books. In Hugh’s case the company’s lawyer agreed on the fourth day in court to disclose a windows engineering report, avoiding what was likely to be an adverse ruling. The company’s lawyer portrays this as a victory, saying that the action by Mr. Trenchard was dismissed. Sure… by consent.

Of course we should not have to sue to be assured that we’re not subsidizing our landlord’s rental business and head-office expenses. A mature and fair landlord with no guilty conscience would likely have an open-book policy. It’s not like there’s any business advantage to keeping secret the operating expenses of a leasehold building. Which secrecy then makes us suspicious.

Since the owners of Westsea Construction won’t be open about how it spends our money we need legislation that requires the books to be open. Back to you, Carole. (And, updated 2 December 2020, to you, MLA Grace Lore and Minister of Housing David Eby.)

Litigation billings are not Hugh’s fault

A minority of Orchard House lessees blame litigant Hugh Trenchard for our landlord billing all lessees its litigation expenses of over $1 million as of the end of 2019. ‘Sorry, but this is not Hugh’s fault. It is Westsea Construction that ignored a precedent-setting ruling indicating that it may NOT collect these expenses from lessees.

Anyway, some of us have chosen not to pay these charges by our landlord, and you could do the same. Yes, you too might then face a Petition-action lawsuit for defying the company. But numerous of us already face that, so we’ll settle the matter for you before you’d get to court. If you don’t dare defy the company and choose to pay these outrageous billings (illegal in other jurisdictions!), at least don’t blame your neighbour for your landlord’s actions.

If you’ve been paying Westsea its demanded litigation expenses, it’s time to file your claim to recover that money, either via the B.C. Civil Dispute Resolution Tribunal or via a small-claims court action. Information about how to proceed is posted on this web site under the heading “Disputing WS’s legal costs”. Sharpen your pencil. And if you thought these billings were his fault, stop blaming Hugh.

This building should be smoke-free

While many of us don’t like the smell of tobacco and/or marijuana, some of us also have asthma that flares up in reaction to smoke. It’s not fun to begin to wheeze and fight for air in one’s own home or while sunning on the balcony when someone else lights up a cigarette or a joint.

I raised this with Westsea Construction during 2017, and to management’s credit their legal people were in touch with two suite leaseholders and/or their tenants, which improved my situation, but did not resolve it. I was told that enforcement was under Rules and Regs. # 2, “No Lessee shall make or permit any disturbing noises in the building or do or permit anything to be done therein which will interfere with the rights, comfort and convenience of other occupants of the building.” Also, Rules and Regs. #29, which says, “No lessee shall permit cooking or other odours to escape from suites into the building.”

But if specific instances of smoking are deemed to be a nuisance under these clauses, why aren’t ALL such instances a nuisance? So that’s what I told Westsea; that my comfort and convenience certainly IS being affected, and that under these clauses the building should simply be declared smoke-free. ‘No such luck. “At this time Orchard House will not be declared a smoke-free building,” was the reply.

Since then I’ve been distracted, as this web site shows, but will bring the issue forward in future. Perhaps a few other leaseholders will help me sponsor a legal action (“tort of nuisance”) to have a judge declare that smoking is, in fact, a comfort and health-compromising nuisance that cannot be allowed under our in-house Rules. Now excuse me, as I have to go use my asthma-treatment inhaler.

Election signs ARE allowed!

As voters in B.C. and in Canada we all have the right to show our support for any candidate and party in a given race. That means you may put a campaign sign in your leasehold apartment window or on your balcony for the duration of a campaign. Westsea Construction (nor your landlord, if you’re a renter) has nothing to say about it and would, in fact, be in breach of the law by telling you to remove such a sign.

Here’s what the federal Elections Act says under “Election Advertising” at section 322 (1): “No landlord or person acting on their behalf may prohibit a tenant from displaying election advertising posters on the premises to which the lease relates…”. It then goes on to say that signs must be of a reasonable size and that the landlord/property owner can decline allowing such signs in common areas.

The B.C. Election Act at section 228.1 says: “A landlord or person acting on a landlord’s behalf must not prohibit a tenant from displaying election advertising posters on the premises to which the tenant’s tenancy agreement relates.”  ‘Pretty clear!