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Fort McMurray condo owners face financial ruin despite court settlement

A court settlement may have been reached but the troubled Penhorwood Condo saga is far from resolved in owners minds.

The building was demolished in 2015, but owners have continued to pay their mortgages

A court settlement may have been reached, but the troubled Penhorwood Condo saga is far from resolved in owners minds. 0:48

Though settlements have been reached and the building has long-since been torn down, the saga of the troubled Penhorwood condo complex in Fort McMurray is far from resolved in owners' minds.

After 11 years of litigation, a Calgary Court of Queen's Bench judge approved the final settlements in September 2017, court documents show.

The only thing that's left is for the courts to approve a process under which owners can deal with the banks still carrying unpaid mortgages, said Christine Burton, president of the Penhorwood Condo Association.

Even after that's worked out, some owners will continue to live in financial ruin, Burton said.

"Some people went bankrupt," she said. "A lot of people foreclosed, stopped paying their mortgages. We had a lot of marriages break up over this."

The Penhorwood Condominium complex was deemed structurally unsafe and remained boarded up for years. (CBC)

Problems from roof to foundation

The seven-building, 168-unit complex was built between 2003 and 2004.

Three years later, in January 2007, condo owners filed their first statement of claim. In several amended claims filed later, owners alleged numerous building deficiencies from roofs to foundations.

"Just about every single system in the building was failing," Burton said.

In 2011, municipal building inspectors determined the complex was structurally unsound, and ordered a sudden evacuation on a cold night in March.

Condo owners filed a $60-million lawsuit that year against the companies that built the complex — 970365 Alberta Ltd, Prairie Communities Corp., and Dome Britannia Properties Inc. — the architect and engineering firms that designed it and the municipality that approved it. The condemned building was torn down in 2015.

Since then, owners have continued to pay their mortgages.

The exact amount the defendants paid to condo owners is unknown because the 2017 settlement is sealed under a court order.

Court settlements are not an admission of guilt.

The lawsuit and a class action suit were suspended after the settlements were reached, Burton said.

Demolition of condo complex begins 0:35

Settlement doesn't equal loss

Owner Pawel Odrzygozdz received only a fraction of the amount needed to pay off his $250,000 mortgage. He anticipates he'll be paying off his debt for years.

But for him, the loss has been even greater. He and his wife were expecting twins, but she miscarried after the evacuation.

"I guess a lot of people could consider there was no life lost in this entire situation. That's not how I look at it," Odrzygozdz said. "The way I look at it is, I lost two potential babies that potentially could have been born healthy.

"But because of this entire situation, they weren't able to come into this world."

The land the Penhorwood Condo Complex sat on is for sale. (David Thurton/ CBC)

The 4.74-acre site is now up for sale, with an asking price of $9,500,000. Any money from the sale, Burton said, will go to condo owners.

Follow David Thurton, CBC's Fort McMurray correspondent, on Facebook and Twitter, or email him at david.thurton@cbc.ca

About the Author

David Thurton is a national reporter in CBC's Parliamentary Bureau. He's worked for CBC in Fort McMurray, the Maritimes and in Canada's Arctic.