Two weeks ago, we blogged about the Periodic Information Certificate. This week, we discuss its little brother: the Information Certificate Update. When is one due and how do they work?
Types of Information Certificates
Under the newly adopted amended Condo Act, condo corporations have to regularly send out the following three types of Information Certificates:
- The Periodic Information Certificate (PIC)
- The Information Certificate Update (ICU)
- The New Owner Information Certificate (NOIC)
The purpose of these Certificates is to give owners an update on the status and financial health of their corporation. An “improved” Status Certificate of kinds.
We already blogged about the Periodic Information Certificate. In particular, we provided our readers with a useful chart showing the deadlines by which each corporation must sent its PICs out. Indeed, the deadline varies for each corporation since it is based on the end of the fiscal year of the corporation.
The Information Certificate Update
This week, we blog about the Information Certificate Update (the “ICU”). The purpose of an ICU is to update owners when certain important changes take place at the corporation. That way, owners are informed of these changes in a timely fashion rather than having to wait until the next PIC, which could be 6 months later.
What changes trigger an ICU?
An ICU must be sent to owners when any of the following changes occur:
- a change in the directors or officers of the corporation [more on this further below];
- A change in the address for service of the corporation, of the directors or officers or of the management provider;
- A change of the address at which a request to examine records can be made;
- A change in the method of electronic communications the corporation will use when notifying owners (this applies only to owners having consented to electronic notification – we will blog about this);
- A change in the amount of the insurance deductible;
- If the corporation’s insurance is terminated; and,
- If the board lose quorum as a result of a vacancy having arose on the board.
The Corporation may with a by-law add other circumstances triggering an ICU.
What does the ICU looks like?
Good news! Corporations must use the ICU provided by the Minister. Here is a link to the fillable form and one to the printable form. If you experience difficulties reaching the fillable form, you may want to try using Explorer as your browser. For some reason, the fillable forms are finicky on other internet browsers.
When must an ICU be sent?
Generally speaking, an ICU must be sent within 30 days of the changes that triggered the ICU. However, there are two exceptions to this.
However, when/if a corporation loses its insurance coverage, the corporation must advise owners as soon as reasonably possible after the day the insurance termination came to the corporation’s knowledge. In any event, the corporation must advise its owners no later than 30 days after it first learned of the termination of the insurance.
The second exception has to do with the loss of quorum on the board. In such a case, an ICU must be sent within 5 days of the board losing quorum.
There appears to be a discrepancy between the regulation (which requires that you update owners upon a change in the directors/officers) and the prescribed form (which only appears to be required when the director/officer is actually replaced). In our view, an ICU should be sent upon the vacancy and not only upon the replacement of a director. It may be that both the resignation of a director and the appointment of his/her replacement take place within 30 days. In such case, only one ICU may suffice. But, in our view, an ICU should be required when a director resign, even if the director is not replaced.
It is to be noted that it is possible that corporations may have to send out an ICU (in case of a change) prior to having sent their first PIC ! Indeed, as shown in our chart, some corporations may not have to send their first Periodic Information Certificate for many months. Still, if one of the changes listed above occurs before then, the corporation has to send an ICU.