Carla Lubell

The Court of Appeal for Ontario issued a costs endorsement following an appeal.

The respondent, Metropolitan Toronto Condominium Corporation No. 1352, was awarded costs of $30,000 on a partial indemnity basis.

The respondent Tarion Warranty Corporation was also awarded costs of $11,000, as the appellant was unsuccessful in seeking relief against it.

The appellants appealed the dismissal of a Rule 21 motion seeking to strike a condominium corporation’s action arising from alleged construction defects, including sanitary sewer failures and exterior cladding water penetration.

The court held that although Tarion’s warranty denial decisions were judicial and final for issue estoppel purposes, applying issue estoppel would work an injustice given the consumer protection purpose of the Ontario New Home Warranties Plan Act, the permissive language of the tribunal appeal provisions, the procedural limits of Tarion proceedings, and the advantage of resolving all claims in one forum.

The court further held that the civil action was not an impermissible collateral attack, that Tarion could be sued for payment from the guarantee fund, that the sanitary sewer allegations were not plainly outside the definition of major structural defect, and that the EIFS limitation argument failed.

The appeal was dismissed.