Ongoing advances in communications’ technology are affecting all of us, including strata corporations. Many strata corporations, particularly those high rise buildings found in urban centres are situated in locations which are highly desirable for communications’ companies to position their hi-tech equipment. By permitting a company to install equipment on the common property, the strata corporation is able to generate valuable revenue.

Typically, a communications company approaches a strata corporation through its property manager. The company will be seeking to place certain equipment on the roof of the building. The company presents a written contract to the strata corporation which grants a licence to the communications provider by the strata corporation in connection with a portion of the common property. It may be the roof of the building or some other space within the building or both. These contracts are sometimes called access agreements or site agreements. By means of a licence, the communications company wants access to and use of specified parts of the common property. There may or may not be any communications services provided directly to the strata corporation. In many instances, it is the location of the building that is key to the communications company and there are no services provided to the owners.

In exchange for access to and use of the common property, the communications company pays an annual fee to the strata corporation. Usually, it is a fixed sum of money, sometimes paid in monthly installments or often paid in advance on an annual basis.

There are a number of factors which strata corporations should consider in granting such a right to access and use the common property. When a strata corporation agrees to grant to a non-owner the right to access and use common property, that grant may be a disposition of common property pursuant to the Strata Property Act, S.B.C. 1998, c. 43 and the strata corporation may have to meet the requirements of section 80 of the Strata Property Act. For instance, the strata corporation must approve any disposition of common property by holding an annual or special general meeting and passing a resolution by a 3/4 vote. After the agreement is approved by the owners and signed by the strata corporation, it must be filed in the appropriate Land Title Office with a Certificate of the Strata Corporation in Form F stating that the resolution was passed and that the document being filed conforms to the resolution.

Pursuant to section 252 of the Strata Property Act, the Land Title Office maintains a common property record for each strata corporation and the Registrar of Land Titles must note any charge or other interest that affects common property on the common property record.

Consider the term of the agreement. Often these kinds of licences are granted for a term of five years with an automatic renewal clause for a further five years. Therefore, in effect, the term is ten years.

Does the strata corporation have the right to licence its common property? The strata corporation must ensure that the common property which is the subject of the agreement, has not been licenced or leased to another. An owner may have a prior agreement in connection with the same space. A portion of the roof may be limited common property for an owner’s exclusive use. The owner developer may have retained control of the roof by an agreement entered into before the strata corporation came into existence. The strata corporation should determine if the use of the common property will affect any existing rights granted to another person, such as an owner, and consider those implications.

The strata corporation should be sure to obtain drawings of what the equipment will look like and where it will be located, to determine if there is or will be any interference with any plans which the owners may have for the common property.

Does the agreement preclude agreements with other communications companies? Many of these contracts contain exclusivity clauses which will prevent the strata corporation from permitting another communications provider from sharing the common property and installing its equipment. Not only does the first communications provider want to be assured that another company with a similar installation will not interfere with its equipment, but the first company may have the need to expand in the future and does not want to give over valuable space, particularly to a competitor. The strata corporation must consider how much common property it wants to make available for this source of income. If a particular site appeals to one company, it may appeal to another.

Damage to the common property is another consideration. The communications provider should take full responsibility for any damage to common property on installation of the equipment as well as removal at the end of the term. The common property should be restored by the communications company to the condition that it was in before the equipment was placed there. The installation should be without risk of damage to the common property.

Another consideration to the strata corporation may be the added weight on the roof caused by the equipment. The communications company may have a clause in the agreement that permits them to add more equipment at a later date.

Is access to the building a security issue? The agreement will specify that the communications company will want to be able to access its equipment 7 days per week, 24 hours per day.

The communications provider should warrant that the equipment will not interfere with the normal functioning of any wiring, cables or electronic equipment of the owners. There may be an increase in electricity costs as a result of the equipment and the communications provider should pay for its usage.

As a source of income to the strata corporation, the potential varies. This writer has seen payments of $1,000.00 per month and $1,000.00 per year to strata corporations. The strata corporation may want to consider providing for an increase in the payments to the strata corporation, if the amount of space utilized by the equipment increases over time.

The communications company should indemnify the strata corporation for any expenses or costs that the strata corporation may incur as a result of the existence of the equipment. In other words, there should be no cost to the strata corporation for permitting the use of its common property.

Before the strata corporation agrees to licence the common property in this way, consider having a lawyer review the contract. These agreements create binding obligations on the part of the strata corporation and the commitment may be for ten years or more.