The following are the operations highlights of the past six months:
The units damaged in the January 2013 flood are all repaired or in the final stages of touch-ups. The Party Room experienced a large delay as we searched for an elusive smell. It has been now located and removed. Plans for the rehabilitation of this room are in progress. The lobby repairs have not yet started as we have been in discussions with the insurance company and contractors on what areas require demolition and which require repairs. We believe this process is very near completion. The Board will have details for owners’ comment and discussion in early September on both the 4th floor party room and the lobby.
Shared Facilities Cleaning
The Shared Facilities Manager has changed cleaners due to the resignation of Trilux. You may have noticed a brief period of cleaning deficiencies in the Grande Allée and other Shared Areas; we expect this has been solved.
Building Relations Manager
Residents report that the promotion of Salvatore to Building Relations Manager has been very successful. He continues to help residents on a daily basis and is always available to answer your questions.
The Real Sports terrace is open for business and they invite you to join them for a drink and some food. We continue to work with the management of Real Sports with regards to the promised “Room Service”. Currently the delay is with the production of the menus.
Outlook - General Maintenance and Improvements
The Board of Directors has many plans in the upcoming months to help improve the overall look of your building. Improvements and repairs that are being discussed are such items as: elevators, floor rehabilitation, improved security, improved terrace gardens, etc. If you have any suggestions please advise our Property Manager, Dan Fried, or Salvatore, Building Relations Manager.
Arbitrations & Litigation
The following case-by-case status report on the arbitrations and civil action between OCSCC 815 and 90 George Street Ltd portrays the determination and diligence with which the board and its counsel are proceeding. Time being of the essence, from quarter to quarter, owners will be informed of progress leading to eventual resolutions – either in the form of ordered outcomes or dispute settlements. Owners will recall that 90 George Street Ltd commenced a civil action against each of the members of the former board of directors of OCSCC 815 and against OCSCC 815 itself. This action is in its early days with nothing of consequence to report as yet except to note again that the Corporation is being represented by counsel appointed by our insurer at its cost. The special assessment for legal expenses that commenced in May 2013 is expected to be adequate funding to successfully complete the following actions:
1st year Budget Shortfall
This dispute is very near completion. The Arbitration commenced on June 4th and 5thand was presided over by Mr. James Chadwick. After two days of hearing, including testimony from witnesses called by OCSCC 815 and the opening submissions by the respective parties, OCSCC 815 closed its case. There was however insufficient time to complete the testimony of 90 George Street Ltd’s witnesses. The Arbitration hearing will continue on August 14th and 15th in order to finish the testimony of 90 George Street Ltd’s witnesses and to hear closing submissions.
Reserve Fund Claim
Our counsel advises that the value of this claim is $3,000,000 exclusive of any award of costs. The Respondent (90 George Street Ltd) served its Responding Affidavit/Motion Record on March 1, 2013. The Applicant Corporation (OCSCC 815) served two Reply Affidavits on May 16, 2013. The next step in the proceeding will be completing the cross examinations on the Affidavits. Pursuant to the court-ordered timetable for this civil action, examinations were originally to take place by end of June. The Corporation, however, required an extension of time to complete the Reply Affidavit of one of its witnesses. The dates for cross-examinations will be adjusted and set shortly. We anticipate the timeline currently set by the court will be adjusted by two or three months, subject to the court’s availability for long motions.
Shared Facilities Agreement
Our counsel advises that the value of this claim is $200,000 exclusive of any award of costs and the implicit value for owners’ money arising from improved shared services and shared facilities management and the implicit value of our successful defense of 90 George Street Ltd’s claim to recover past property taxes.
An original Notice of Arbitration and two subsequent amendments to the Notice have been filed and the respondent, 90 George Street Ltd, has filed its response. Owners will recall that the arbitrator heard a motion from the respondent in November of last year wherein the respondent unsuccessfully challenged the jurisdiction of the arbitrator. 90 George Street Ltd filed a Notice of Arbitration respecting property taxes in February of this year. OCSCC 815 filed a Response to which 90 George Street Ltd has filed a Reply and Response to our Response. The proceedings have moved to the discovery and document disclosure stages. Document disclosure is due to be completed by July 8, 2013 after three extensions that were mutually agreed. The document disclosure process has been challenging, as extraordinary effort was applied to obtain and prepare all of required disclosure correspondences and documents. This effort included canvassing all of the current and past Board members to determine their possession of any relevant documents or correspondence. This process is almost complete. At dates to be determined in August 2013, formal discovery is anticipated to be at least a day with Mr. Hession and a day with 90 George Street Ltd’s representative.
Our actions against 90 George Street Ltd rely on facts validated by expert opinions. This is true of our claim for the first year budget shortfall, the shared facilities agreement claim and the reserve fund claim. On the latter claim, for example, its quantum is based on conventional reserve fund calculations enabling the funding of the repair and replacement of building components and systems over extended periods. These calculations are performed by experts who, in turn, rely on engineering and other technical advice from original equipment manufacturers. In this and the other actions, the board is confident in its advisors and the facts supporting its claims. It is particularly certain that its actions are in the owners’ best interests.
In the past year, a few well-intentioned owners have offered to help bring forward settlement offers from 90 George Street Ltd. At its March 5, 2013 meeting with owners, the board made clear its readiness and willingness to consider settlement offers. Because we are in the midst of arbitration and litigation formalities, any such offers must be made in a formal fashion through the lawyers representing the parties. Such activity has already taken place.
Budget & Financial Considerations
Reserve fund account
May-01-2013 to June-30-2013
Balance as of April-30-2013 $68,888.00
Cash Deposits from Operating Accounts (3) $0.00
Expected cash from Special assessment $31,330.00
Cash deposited from Special Assessment (2) $37,418.00
Capital Expenses incurred $62,608.00
List of Expenditures:
$34,946.00 - Misc.HVAC repairs for 2012-2013
$17,842.00 - HVAC repairs filter system
$6,881.00 - Anti tip repairs
$2,921.00 - Make Up Air repairs
$18.00 - Admin. Fees
Balance in Reserve fund account at end of period (1) $43,698.00
1) Ending balance includes banking administration fees
2) Some owners paid assessment all up front
3) This line is the amount deposited into our Reserve bank
account from the Operating account as per the Reserve Fund Study
July 2013 and forward, will see this line item be monthly $17,000.00
Legal Claims Account
May-01-2013 to June-30-2013
Expected special assessment cash received $34,980
Special assessment cash received (1) $38,362
Paid on Account during period $28,338
(1) Some owners have paid the entire assessment amount upfront
**Owners are reminded that minutes of board meetings are available on the 90georgeliving.com website under Documents/Minutes.