Co-ops can no longer use occupancy agreement terminations - clarification - May 23, 2013

Clarification of memo on changes to the Coop Act 

Last week we told you about some important changes to the Cooperative Association Act (the Co-op Act) dealing with the ability of housing co-ops to end a membership by way of an Occupancy Agreement termination.  

In summary:

  1. A housing co-op is no longer permitted to end someone’s membership by terminating their Occupancy Agreement.
     
  2. The only way to terminate a membership is under Section 35 of the Co-op Act, which is already incorporated into every co-op’s Rules in Rule 5 (if you are using the Model Rules published by CHF BC), and now also a new section 35.1 of the Act.
     
  3. Membership terminations for arrears are now treated differently under the Co-op Act. The Act provides that a member may not appeal the decision of the co-op’s board of directors to the next meeting of members if the reason for termination is arrears. Any appeal must be directly to the court, provided that a co-op has amended its Rules to remove the right of appeal to the members.
     
  4. If a co-op’s Rules contain a provision that permits a co-op to end someone's membership by way of Occupancy Agreement termination, then the co-op must amend its Rules at the next meeting of members to do away with that ability.

In advising you of these important changes, we left out one detail that may have a material impact on when your co-op must make the changes in its Rules required by the Act.
 
In #4 above, we should have added: If the next meeting of members is held in June, then the deadline for making the required changes is the meeting of members following the June meeting.  For most co-ops, practically speaking, this will mean that the deadline is in September or later. See the complete news story.
 
Very shortly CHF BC will issue a detailed memo advising co-ops how to make the Rule changes now required by the Co-op Act.  This will be followed by the new Model Rules 2.0, a comprehensive second edition to our popular Model Rules and Occupancy Agreement.
 
If you have any questions in the meantime, please don’t hesitate to contact Sue Moorhead, CHF BC’s education director, at smoorhead@chf.bc.ca with general inquiries about this advisory. If you need specific advice and guidance, you should consult your co-op’s lawyer or manager.

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