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Keep an eye out for condo board‘s ‘conflict of interest Dear Condofax: We have a number of questions about the operation of our condo and they have to do with the conduct of members of the Board of Directors. It has been the practice of the Board to award themselves before an annual meeting with a formal dinner, including wine with the meal, paid for out of corâ€" poration funds. In addition food and wine is provided when Directors meetâ€" ings are held, again out of corporation funds. Those unit owners attending the annual meeting are treated to a substanâ€" tial and plentiful lunch, again out of corporation funds. Has the Board the right to spend this money without any approval of the owners? There also is a practice of awarding cash prizes to owners whose garden is judged by the Board to be the most pleasant. Last year the President received such an award. Wouldn‘t this be considered to be a conflict of interâ€" est? We are concerned about the amount of money distributed in these areas by the Board. How can we find out how this money is being spent? We are also concerned about a furâ€" ther matter of conflict of interest. The Board dismissed the previous manageâ€" ment company and gave a management contract to a management company in which the President has an interest, together with her consort who is living in the same unit. Both are on the Board, one as President, the other, as a Director who is hired by the corporaâ€" tion to do the other as a Director who is hired by the corporation to do repairs to the units. Do the members of the Board have the right to enter a unit owner‘s yard at any time? Can we request permission to examine the corporations books to ascertain how our money is being spent? First let us deal with the question about the encroachment of members of the Board on your yard. Strictly speakâ€" ing, it is not YOUR yard, it is part of the common elements as defined in your Declaration and Description and while it is defined as being your excluâ€" sive use common element â€" for your use exclusively â€" as under Section 3 (1) (f) which gives a description of those parts of the common elements that can only be used by certain unit owners. These are known as exclusive use comâ€" mon elements. It is still part of the overall common elements and as such is under the control and responsibility of the Board to maintain and supervise. For the Board is empowered to manage the affairs of the corporation as stated in Section 15â€"(1) and as such has the right to enter and inspect any part of the common elements, exclusive or not. But in the other areas of your conâ€" cern, you have the right to inquire about the use of the funds of the corpoâ€" ration and the Condominium Act proâ€" vides you with the authority toâ€"examine Miss Informed the records of the condo under Section 40â€"(1) "All records about the receipt and payment of money, made to anyâ€" one on behalf of the corporation, must be made available for examination. Any owner, the corporation or unit mortgage holder may ask to see the records upon reasonable notice and during normal business hours. (2) If examination of records is not made available, the corporation, any owner or unit mortgage holder can apply to a judge of country or district court, to make an order to have an investigation or audit of the records made." As to who may be a Director? The only restrictions are that you must be over 18, not a undischarged bankrupt and mentally competent. Thus anyone can be a director, they do not have to own a unit and can be appointed to the Board in the event of a vacancy, according to Section 15â€"(9), the remaining members of the Board can appoint a suitable person to complete the missing person‘s term of office. At the next annual meeting the vacancy can be filled by election. At the Annual Meeting, under Section 18â€"(1), if entitled to vote, any owner and mortgage holder can raise any question regarding the operation of the corporation. Notice for that meeting must be given 10 days in advance by written notice, giving time, place, date and reason for the meeting. Included with that notice there must be a copy of a properly prepared financial statement which the Board must present to the owners for discussion. It would be quite in order to have the owners question the use of your funds for the benefit of the Directors and to have a motion passed to that effect. If you have questions about the legality of any of the points I have raised, then I would suggest that you should consult with your lawyer who would be able to clarify your legal position particularly about the question of possible conflict of interest of the President and her partner in the awardâ€" ing of any contracts for maintenance and repairs. Condofax welcomes your questions about condominiums and can be reached through the Oakville Beaver at 467 Speers Rd., Oakville, Ontario L6K 384 or by calling The Golden Horseshoe Chapter of the Canadian Condominium Institute (CCI) at 521â€" 8144. H. Penman Smith is a Burlington resident who has been active in all phases of condominium activity since 1975. He is viceâ€"president of the Golden Horseshoe Chapter of the CCI and former Condominium Information Officer with the Ministry of Consumer and Commercial relations of the province of Ontario. The opinions statâ€" ed in this column are his own. He is not qualified to give legal opinions. 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