Sections in stratas

Some types of strata lots can be formally organized into sections within the strata corporation. Sections are like "mini strata corporations". Each section operates independently with respect to matters that relate solely to the section. The strata corporation still retains its powers and duties in matters of common interest to all owners.

Learn more on this page:
An overview of sections
How sections are created or cancelled
How sections operate
A section’s bylaws and rules
The relationship between sections and types
Allocating section expenses

An overview  of sections

The Strata Property Act allows some specific types of strata lots to be formally organized into sections. The sections represent the interests of the strata lot owners in the section.

Both the strata corporation and the sections hold annual general meetings, pass budgets, and create and enforce bylaws and rules within their area of administration.

If a strata corporation has sections, the owners in all sections will also elect a strata council to administer functions relating to the strata corporation as a whole.

Each section must have a section executive; a member of the section executive is eligible for election to the strata corporation's council.

A strata corporation with sections will therefore have two distinct levels of administration:

• one level related to the strata corporation as a whole and
• the other level related to the different sections alone

If strata lots in a strata corporation are divided into sections, the strata corporation still retains its powers and duties with respect to matters relating to the strata corporation as a whole.

In April 2013, the Real Estate Council of BC (RECBC); now part of the BC Financial Services Authority (BCFSA) as of August 1, 2021; issued information bulletins clarifying the responsibilities of strata management companies managing sections to acknowledge and protect the different interests of strata corporations and sections. (BCFSA is responsible for the licensing, education and discipline of strata property managers and strata property management companies).

How sections are created  or cancelled

The Strata Property Act and regulations specify what types of strata lots can become sections to represent the different interests of:

• owners of residential strata lots and owners of non-residential strata lots
• owners of non-residential strata lots can form different sections if the strata lots are used for significantly different purposes (for example, a restaurant and a retail store)
• under the Strata Property Regulations, residential strata lots can only be divided into different residential sections for strata lots that are: apartment style; townhouse style; and detached houses

Sections may be created by the owner developer when the strata corporation is created, by filing bylaws with the strata plan in the Land Title Office which create the sections and provide for their administration. The owner developer may also file any resolutions to designate limited common property, in accordance with section 74 of the Strata Property Act, for the exclusive use of all the strata lots in a section.

The strata corporation may also create or cancel sections by following the steps set out in the Strata Property Act. The strata corporation must hold an annual or special general meeting to consider the creation or cancellation of a section. The notice of the meeting must include:

• a resolution to amend the bylaws to provide for either the creation and administration of each section or the cancellation of the sections. The resolution must be approved by both a 3/4 vote of the eligible voters in the proposed or existing section, and a 3/4 vote of the eligible voters in the strata corporation. The bylaw amendment must be filed in the Land Title Office
• any resolution approved by a 3/4 vote to designate limited common property, as per section 74 of the Strata Property Act, for the exclusive use of all strata lots in the section or to remove a designation in accordance with section 75 of the Strata Property Act

How sections operate

A body called an executive administers the section. The members of the executive are elected by the eligible voters within the section. The executive of a section functions like a strata council and it has the same powers and duties with respect to the section that the strata council has with respect to the strata corporation. The bylaws of a section can provide for an election process for the executive and its powers and duties.

With respect to matters relating solely to a section, the section is a corporation and has the same powers and duties as the strata corporation to:

• establish its own operating fund and contingency reserve fund for common expenses of the section including expenses relating to limited common property designated for the exclusive use of all the strata lots in the section
• prepare a section budget and require section owners to pay strata fees and special levies for expenditures the section authorizes
• sue or arbitrate in the name of the section
• enter contracts in the name of the section
• hire a strata property manager
• acquire and dispose of land and other property in the name of or on behalf of the section 
• enforces strata bylaws and rules.

A section must not enter into a contract, or sue or arbitrate, in the name of the strata corporation and the strata corporation has no liability for contracts made, or debts, or legal costs incurred, by the section.

A section may obtain insurance only against perils that are not insured by the strata corporation or for amounts that are in excess of amounts insured by the strata corporation.

A section’s bylaws  and rules

The strata corporation’s bylaws apply to a section unless they have been amended by the section. However, only a bylaw that relates to a section may be amended by that section. Sections may also create bylaws to govern matters within the section.

Prior to the second annual general meeting, the bylaws may only be amended as follows: 

• residential sections may only amend its bylaws by unanimous vote and
• non-residential sections may amend the bylaws by a 3/4 vote or by a different voting threshold if approved in the bylaws

After the second annual general meeting a section may amend its bylaws as follows:

• residential sections may amend its bylaws by a 3/4 vote at an annual or special general meeting of the section and
• non-residential sections may amend its bylaws by a 3/4 vote or by a different voting threshold if approved in the bylaws, at an annual or special general meeting of the section. Find out more about strata bylaws and rules.

The executive of the section may make rules governing the use, safety and condition of limited common property designated for the use of all strata lots in the section and property acquired in the name of the section.

The relationship between sections and types

Sections (and strata corporations) can pass a bylaw creating types for the purpose of allocating operating fund expenses based on the different features of strata lots within the section.

For instance, if a section contains ten strata lots with gas fireplaces and ten strata lots without gas fireplaces, the operating fund common expenses for fireplaces (e.g. gas) could be allocated to just the ten strata lots with fireplaces. 

The creation of different types of strata lots does not automatically create sections.

Sections are "mini strata corporations" with their own powers and duties but a type of strata lot is only a method of allocating operating expenses to certain strata lots in a section (or strata corporation).

Types (unlike sections) do not have their own operating budget, do not collect separate contingency reserve fund contributions and do not allocate special levies based on type.

Allocating section expenses 

Generally, expenses in a strata corporation are shared by all strata lots on the basis of unit entitlement, or some other method that has been unanimously approved.

Within a section, the same general rule applies: expenses that relate solely to the strata lots in a section are shared only by the strata lots in the section.

However, there are exceptions that permit a strata corporation to apportion certain contributions to only some of the strata lots. The same exceptions apply for sections as follows:

Sections and Limited Common Property:  If an operating expense relates to limited common property in a section, the contribution for this expense will be apportioned, by unit entitlement or some other method approved by unanimous resolution, only to those strata lots in the section which are entitled to use the limited common property.

However, while a section’s operating expense may be apportioned only to strata lots entitled to use the limited common property, a contribution to the section’s contingency reserve fund or a special levy must be shared by all strata lots in the section.

Sections and Types:  If an operating expense relates to a type of strata lot in a section and that type of strata lot has been identified in a section bylaw, the contribution for this expense will be apportioned, by unit entitlement or some other method approved by unanimous resolution, only to strata lots of that type specified in the bylaw.

However, while a section’s operating expenses may be apportioned only to strata lots identified by way of type in the section’s bylaws, contributions to the section’s contingency reserve fund or a special levy must be shared by all strata lots in the section.

Repair and Maintenance of Portions of Strata Lots
Under the Strata Property Act, Regulations and a strata corporation's or section's bylaws, there is a distinction made between who undertakes the actual repair and maintenance of various parts of the strata development and who pays for the maintenance and repair costs.

If a section has created a bylaw that places responsibility on the section for the repair and maintenance of portions of some strata lots in the section, the operating expenses and special levies which relate to the repair and maintenance of those portions of strata lots are apportioned by unit entitlement or some other method approved by unanimous resolution, only to those strata lots being repaired or maintained. 

However, while a contribution to the section’s operating fund or a special levy may be apportioned only to the strata lots that the section is repairing or maintaining, contributions to the section’s contingency reserve fund for strata lot expenses must be shared by all strata lots in the section. 

References:
Strata Property Act: 72, 100, 108, 127, 190-198
Strata Property Regulation: 6.4, 11.1 through 11.3

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