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Grow House in Commercial Condo Ordered to Pay Its Fair Share of Water Usage

Grow House in Commercial Condo Ordered to Pay Its Fair Share of Water Usage

An Ontario Superior Court recently ruled that a commercial condominium association could collect more than the proportionate share for water usage from a unit owner who used his unit for a legal medical marijuana grow house. The condominium consisted of 20 commercial units. In early 2012, about six months after the defendant moved into his unit, the condo manager noticed a significant increase in the condominium’s quarterly water bill. The condominium was served by only 1 water meter. Upon receipt of the water bill, the condo manager hired a plumber to do a complete survey of the property to check for leaks. None were found.

During the property inspection, the property manager discovered the defendant’s grow op. The manager then installed a water meter for the defendant’s property only and was able to conclude that the spike in water consumption was definitely attributable to the defendant. The association sought to recover amounts in excess of defendant’s 5.13% proportionate interest in the common elements and common expenses for prior bills from defendant. The Declaration of Condominium provided that the association had the obligation to pay certain common expenses, including water, “except such that is used for commercial and industrial purposes and except hot water.”

The court not only found that the use of water in the grow house was a commercial use, but that the defendant’s use was so disproportionate as to amount to unjust enrichment. The court further concluded that the defendant’s use was inequitable and unfair and that the other 19 unit owners were subsidizing defendant’s business.

Would a similar case in Florida yield the same result if Florida approves medical marijuana use the next time it is on the ballot? F.S. 718.115(7) provides that common expenses shall be collected in the percentages or proportions set forth in the declaration. This provision specifically applies to residential condominiums and there is no similar provision for commercial condominiums. However, because commercial condominiums are governed by the Condominium Act, this section would likely apply. Therefore, a strict reading suggests a unit owner would only be billed for its actual water usage absent an overriding provision in the declaration. Because Florida is advanced in commercial and mixed use condominiums, many declarations already account for this and most developers plan for this situation. With uses such as restaurants, salons and spas in many commercial and mixed use condominiums, condos are generally separately metered and owners pay providers directly for their water usage so as to avoid this type of problem in the same way that large rental projects would plan for and bill large water consumers. If we get to the point of legal marijuana in Florida, a commercial grow house in a commercial condominium would be wise to assure that his water use will not upset the condominium budget.

 

David Blattner

David Blattner

dblattner@beckerlawyers.com

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JoAnn Nesta Burnett

jburnett@beckerlawyers.com

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