The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Senior realtors yesterday backed a Supreme Court judge’s call to reform the “antiquated” Condominium Act because “everything gets thrown off” in a sale by the slightest error in unit size.

John Christie, HG Christie’s president and managing broker, told Tribune Business it “would be a good idea” to follow Justice Loren Klein’s suggestion because the smallest mistake in calculating a condo unit’s dimensions can create title questions and disrupt a transaction

“I know the Law of Property (Condominium) Act 1965 is very specific and can lead to a lot of problems,” he said. “The problem is that what has happened is, if the lawyer is not meticulous when drafting it the first time, and it’s [a unit’s size and dimensions] slightly off, and you’ve made a mistake in measuring it, that messes up the title.

“If it goes through two to three sales, and then a good lawyer is alerted to it from a long way back, they have to redo it and get it redrafted.” Mr Christie was referring to revisions to a condominium complex’s Declaration of Condominium, which has to be redrafted and any changes approved, if a particular unit or units are found to be of different size to that specified in this document.

Speaking from personal experience, the HG Christie chief added: “I’m in the process of a condo sale that has become bogged down because the lines were not drawn properly in the first place. We’re waiting for the lawyers to work it out. Simplify it while being fair to both buyer and seller.

“You’re buying that existing piece of that building, and if it’s slightly off, everything gets thrown off. I think it could be clarified and made more simple.” If a condo unit is under-sized or over-sized compared to the specifications set out in the Declaration of Condominium, it immediately raises questions as to whether a seller can provide good title, thereby disrupting potential sales.

George Damianos, president of Damianos Sotheby’s International Realty, told Tribune Business of Justice Klein’s call: “The only thing I can say to you is that I totally agree with him. I do think it’s antiquated and there are a number of issues that come up precisely with the Declaration of Condominium, and then they have to correct them and refile them.

“I’m embarrassed to tell you I know of issues here in Lyford Cay. I know we’ve had to clean up some of the issues here with two condominium buildings at Lyford Cay. He’s totally correct. It does need to be sorted. What can I say? It’s like a lot of things that need to be uplifted in The Bahamas. I totally agree with him. It needs to be revised.”

Justice Klein, in ruling on a sales dispute involving a unit at Paradise Island’s One Ocean condo project, asserted that “only the Quieting Titles Act has been productive of greater mischief in the law of real property” than the Law of Property (Condominium) Act 1965.

“The claim also illustrates the unique complications that can arise from transactions involving the peculiar legal estate of fee simple ownership of property in a multi-storey building,” he wrote in his judgment.

“It is apparent that the Condominium Act has not kept pace with the mischief which has been generated by some of its provisions. These difficulties are strikingly illustrated by transactions involving the sale (or resale) of units, which seemingly cast an onerous burden on a prospective purchaser to ascertain that the building and units comply with near exactitude to the Declaration and registered plan.

“It has been left for the courts to attempt to ameliorate some of these issues by resorting to common law and equitable principles on a case-by-case basis, which has not always produced a uniform approach. The time may well have come for there to be a review and revision of the Act benchmarked on other jurisdictions to address the unique issues that have developed regarding condominium title.

“It is noted, for example, that modern condominium legislation in Canada and elsewhere provide for what is called an ‘estoppel certificate’ to be provided by the (condominium) association to the purchaser of a resale unit, providing information in relation to the condominium and unit which creates an estoppel in favour of the purchaser, and removes some uncertainty out of the transaction.”

Several sales at the ten-storey One Ocean condo project, which dominates the skyline on Paradise Island’s southern shore, have become embroiled in bitter court fights stemming from disputes over the size of the unit involved.

The controversy, which has been the subject of three separate Supreme Court rulings within a two-month period, stems from “inaccuracies” contained in the original architect’s certificate that were then used to set-out the dimensions of One Ocean’s 79 units in its Declaration of Condominium - the legal instrument that gives effect to the condominium’s creation.

A December 20, 2021, judgment by Justice Ian Winder approved an application by the One Ocean condo owners and their association to amend the development’s Declaration of Condominium such that it contained the right unit and common area dimensions/sizes. This will ensure that owners can provide buyers with good title should they sell their units.

The problems stemmed from the original architect’s certificate, signed-off by Bahamian architect Leslie Johnson in 2010, which incorrectly stated the sizes and dimensions of One Ocean’s penthouse units which subsequently underwent renovations under the property’s new developer, Replay Resorts. The incorrect dimensions were recorded in the Declaration of Condominium.

As a result, legal disputes erupted when Replay Resorts sought to sell two penthouse units. One purchaser, Belitza Marling Sagaray Silva, said she sought to withdraw from a $4.1m deal due to fears Replay was unable to provide good title because, while the unit was advertised at 6,165 square feet, the Declaration of Condominium described it as comprising 4,801 square feet.

And the purchaser of another One Ocean penthouse, a corporate entity named Gathina Ltd, had argued it was entitled to be refunded $1.105m because Replay was unable to provide it, too, with good title.

It alleged that Replay only had good title to the 4,801 square feet represented as the unit’s size in the Declaration of Condominium, whereas the true area involved was 6,419 square feet. As a result, Gathnia Ltd claimed it could not obtain good title to 25 percent of the space.