Significant Unfairness and Strata Budgets

Trevor Morley
Jul 24
4 min read

Updated: 5 days ago

CAN A STRATA CHARGE AN OWNER FOR A SERVICE THEY DO NOT RECEIVE?

A Strata generally cannot charge an Owner for an expense that has nothing to do with them, though the line between "unrelated" and "just uneven" is narrower than it first appears. Strata fees are calculated as each Strata Lot's share of the budgeted operating and Contingency Reserve Fund contributions, using the formula set out in the Strata Property Act (Calculating strata fees, s.99). Compliance with that prescribed formula is, as a general rule, not significantly unfair under s.164, even where one Owner ends up paying for more than they personally use (King Day Holdings Ltd. v. The Owners, Strata Plan LMS3851, 2020 BCCA 342). That general rule is not absolute, and this article covers both where it holds and where it gives way.

HOW DOES A STRATA NORMALLY DIVIDE UP ITS EXPENSES?

A Strata normally divides its expenses among all Owners according to unit entitlement, and every Owner contributes to the same operating and Contingency Reserve Fund regardless of how much they personally use any particular amenity or system (Strata Property Act, s.99). That formula can only be changed to a different basis by a unanimous vote taken after the Strata's first annual general meeting (Change to basis for calculation of contribution, s.100). This is the starting point for every cost-allocation dispute: an Owner who simply benefits less than a neighbour from a shared system does not, on that basis alone, have a claim that the Strata is charging them unfairly.

DOES THIS MEAN AN OWNER MUST PAY FOR A COMMON EXPENSE THEY NEVER USE?

Not if the Strata has Part 11 sections and the expense relates solely to a section the Owner is not part of. Where an expense for the repair and maintenance of common property relates solely to the Strata Lots in one section, the Strata Property Act requires that expense to be shared only among that section's Owners (Expenses of section, s.195). Our understanding is that whether an expense "relates solely" to one section turns on a weighed set of factors:

Whether the property or system provides exclusive access or use to one section's Lots.
Whether the other section's Owners have any use for or access to it.
Whether the utilities or services running through it serve only one section.

For example, our understanding is that where common-property catwalks provide the only means of access to a residential section's Lots, are not used or usable by a commercial section, and carry utilities serving only the residential Lots, the catwalks relate solely to the residential section — the commercial section owes none of the special-levy costs of repairing them (Section 2 of the Owners, Strata Plan LMS 257 v. The Owners, Strata Plan LMS 257, 2025 BCSC 1985).

WHAT IF THE EXPENSE ONLY SEEMS UNRELATED TO AN OWNER?

An expense can still benefit the whole Strata even where an Owner's Lot is not physically adjacent to it. Our understanding is that a building envelope which structurally protects and shelters a mixed-use building, including Lots not directly located within that building, benefits the whole Strata Corporation indirectly, so all Owners contribute to its repair by unit entitlement, even Owners of stand-alone Lots elsewhere in the development (The Residential Section of the Owners, Strata Plan NW 3365 v. The Commercial Section of the Owners, Strata Plan NW 3365, 2026 BCSC 176). Shelter, structural protection, and indirect benefit to Common Property or Limited Common Property elsewhere in the building can be enough to make an expense the whole Strata's to share, even where the Owner raising the complaint never sets foot near it.

CAN A STRATA BE FORCED TO KEEP AN OLD, DIFFERENT COST-SHARING ARRANGEMENT?

A Strata's insistence on reverting to strict unit entitlement can itself be significantly unfair in exceptional circumstances, even though unit entitlement is the Act's own default formula (King Day Holdings, 2020 BCCA 342). It is important to recognize that the exceptional-circumstances exception is narrow: it applies where an established, long-relied-upon different allocation practice is unilaterally abandoned without a duly authorized resolution. The Court of Appeal found exactly this where a Strata and one Owner had operated for roughly a decade under a mutually agreed, differential cost-allocation formula, never formalized by unanimous vote, until a new owner acquired a controlling majority and reverted unilaterally to strict unit entitlement, imposing significant new financial burdens on the original Owner (King Day Holdings). An Owner raising this kind of claim is ordinarily expected to first put forward, and have refused, a s.100 resolution or other available internal process before turning to s.164, unless doing so would plainly be an empty exercise (King Day Holdings).

A STRATA'S EXPENSE ALLOCATION SHOULD MATCH WHO ACTUALLY BENEFITS

Unit entitlement is the Act's own default, and complying with it is generally a safe answer to a cost-allocation complaint. However, "generally" is doing real work in that sentence: where an expense relates solely to a section an Owner has no connection to, or where a Strata abandons a long-standing, mutually accepted different arrangement without going through the process the Act requires, the general rule gives way. A robust and resilient Strata Community keeps its cost allocation matched to who actually benefits, and revisits an old arrangement through a proper vote rather than a change in who controls Council.