A big decision for condominium boards coming out of Alberta in Condominium Corporation No 042 5177 v Kuzio, 2020 ABQB 152.

This is a decision to make permanent an interim injunction that was granted in 2019.  In short, the unit owners were using their unit for short term Airbnb stays, and the board argued that it was not permitted.  It was argued that bylaw restrictions on commercial use were sufficient to stop a unit owner from using their unit for Airbnb rentals.  The court at the interim application stage agreed, and granted an interim injunction.

The court in its final determination reasoned that a stay under Airbnb was a license, and not a lease.  The rationale was that a license granted in this manner (like a hotel stay) is not the same interest in land that a lease is. Accordingly, it was not restricted from being subject to a bylaw in accordance with section 32(5) of their condo Act.  That section states:

32(5)        No bylaw operates to prohibit or restrict the devolution of units or any transfer, lease, mortgage or other dealing with them or to destroy or modify any easement implied or created by this Act.

This looks quite similar to our own section 44(2) of the Condominium Property Act which states:

44 (2) No bylaw of a corporation and no amendment or repeal of a bylaw shall: (a) prohibit or restrict the devolution of units or any transfer, lease, mortgage or other dealing with any unit; or (b) destroy or modify any easement implied or created by this Act.

As a caution, provincial legislation regarding condominiums are very different.  It may be that our courts not adopt the reasoning of the Alberta Court of Queen’s Bench.  For example, the court indicates that there is nothing in their legislation that contemplates short term rentals.  However, ours contemplates that a developer may turn over “any plans or agreements in relation to establishing a short-term rental management pool for units within the corporation.” and defines a short-term rental management pool as “means a rental management agreement pursuant to which one or more units within the corporation will be rented out for periods of less than one month”.

However, section 44(2) was always my main source of hesitation in suggesting that Airbnb rentals could be managed by condominium corporations.  This decision gives some well reasoned argument as to why the opposite could be true.

It will be interesting to see if this gets appealed, but it provides some hope for condominium corporations that are frustrated with Airbnb rentals.  Feel free to reach out if you need more help in this area.