Choosing the Right Forum for Condominium Disputes and the Mediation/Arbitration Process in Ontario

By Inderpreet Sandhu

When a dispute arises in a condominium setting, the first and most important step is choosing the right place to resolve it. In Ontario, condominium disputes can go to:

• The courts (Superior Court or Small Claims Court);
• The Condominium Authority Tribunal (CAT); or
• Mediation and arbitration under section 132 of the Condominium Act, 1998.

Knowing which forum has the proper authority to resolve the dispute will avoid delays, extra costs, and legal mistakes.

What Kinds of Disputes Go to the Courts?

Courts deal with disputes outside the jurisdiction of the CAT and the mandatory mediation/arbitration system. These include but are not limited to:

• Safety or danger issues, such as breaches of section 117(1) of the Condominium Act, 1998 involving risks of injury or property damage;
• Urgent or statutory compliance applications under the Act;
• Appeals or enforcement of arbitration awards; and
• Claims for monetary damages, where parties seek financial compensation—these may proceed in Small Claims Court (for claims up to $50,000) or the Superior Court for higher amounts.

In short: the courts handle urgent, high‑risk, or complex disputes that legislation places outside CAT and section 132 of the Act.

What Kinds of Disputes Can Go to the CAT?

The CAT handles disputes involving condominium records, nuisances (noise, odour, smoke, light, vibration), and governing‑document compliance related to pets, parking, vehicles, storage, and related chargebacks. It also hears broader nuisance and conduct issues—such as smells, lighting problems, and matters involving animals or vehicles—when tied to the condominium  governing documents. The Ontario government is also preparing to expand CAT’s jurisdiction to include disputes about owners’ meetings, including notices, voting procedures, and quorum, with changes anticipated to take effect July 1, 2026. If a dispute falls within CAT’s mandate, it must proceed through the CAT, not the courts.

When Mediation and Arbitration Are Mandatory

Section 132 of the Condominium Act, 1998 requires some disputes proceed by mediation and/or arbitration, before going to court. These include:

(a) Disputes arising from agreements between:

• The condominium corporation and its developer;
• The condominium corporation and its property manager;
• Two or more condominium corporations (e.g., shared facilities agreements); and
• The condominium corporation and an owner about changes to common elements (section 98 agreements);

(b) First‑year budget disputes between a condominium corporation and the developer;

(c) Disputes about the condominium corporation’s declaration, by‑laws, or rules (some issues go to the CAT, but anything outside the CAT’s authority must go through mediation and arbitration); and

(d) Electric vehicle charger installation disputes (these usually involve changes to common elements and therefore fall under section 132).

Why Picking the Wrong Forum Matters

Courts in Ontario treat section 132 as mandatory. If a dispute belongs in mediation/arbitration, you cannot start a court case. If you try, the court will usually:

• Pause (stay) or dismiss the lawsuit, and
• May order you to pay costs

Courts look at the real issue (its “pith and substance”) and not how the claim is worded. The courts will not allow parties to avoid mediation/arbitration by reframing the dispute to try it in the courts. The message is clear: If section 132 applies, you must mediate and/ or arbitrate first.

The Required Steps for Mediation and Arbitration

1.Mediation

• The parties agree on a mediator. If they cannot agree, a court can appoint one. Mediation is informal, encourages discussion, and allows parties to look for a practical solution. A mediator’s role is to help the parties reach a settlement. A mediator cannot make binding decisions.

2.Arbitration

• If mediation fails, the dispute moves to arbitration. The parties select an arbitrator or one can be appointed by the court if the parties cannot agree. The arbitrator holds a formal hearing and makes a binding decision as a court would.

• Arbitrators with condominium experience can better handle technical issues such as budgets, shared facilities, or common‑element changes.

Once mediation and/or arbitration are completed, a party can seek limited court involvement, to appeal the arbitration award or for issues relating to enforcement of the arbitration award.

Conclusion

Ontario’s condominium dispute system is designed to be efficient, fair, and cost‑effective. Many disputes must go through mediation and arbitration before heading to court. By identifying the proper forum early—court, CAT, or mediation/arbitration—parties can avoid unnecessary costs, delays, and procedural mistakes while staying compliant with the Condominium Act, 1998.