Ontario (Technical Standards and Safety Authority) v. Realm of Abodes Inc.
ONTARIO COURT OF JUSTICE
(Central West Region)
BETWEEN:
Ontario (Technical Standards and Safety Authority) (Prosecutor)
— and —
Realm of Abodes Inc. (Defendant)
REASONS FOR JUDGEMENT
Before Justice of the Peace T.J. Howard
Trial heard March 5, 2026, in Burlington, Ontario
Judgement and written reasons delivered March 27, 2026, in Burlington, Ontario
Mr. Cawkell, C Counsel for the Prosecution
Mr. Shah, M. Counsel for the Defendant
Howard J.P.:
A. Introduction
1The corporate defendant, Realm of Abodes Inc., is charged under s. 37(1)(a) of the Technical Standards and Safety Act, 2000, S.O. 2000, c. 16 (the Act) with failing to comply with s. 15 of Ontario Regulation 212/01 (Gaseous Fuels). It is alleged that, as the owner of a natural gas fueled pool heater, the defendant failed to maintain the appliance in a safe operating condition such that carbon monoxide leaked from the appliance into an indoor space. This leak is alleged to have caused carbon monoxide poisoning to 3 children who were guests at the property, which is operated by the defendant as a short-term rental. Mr. Raghavendra Baddi, director of Realm of Abodes Inc., pleaded not guilty to the charge.
2It is not contested that the defendant owns the property at 796 Sunset Road, Burlington, where the incident took place. Neither is it contested that on November 27, 2024, there was a carbon monoxide leak from the pool heater which resulted in carbon monoxide poisoning to 3 children within the home. Fortunately, the children were treated and survived. What is contested is whether the defendant adequately maintained the pool heater, and if not, whether it was duly diligent in its efforts.
3For the reasons that follow, I conclude that the defendant failed to ensure that the gas appliance was maintained in a safe operating condition but was duly diligent. Thus, the defendant is acquitted.
B. Analysis
i. an offence of strict liability
4I find that the offence of failing to comply with s. 15 of Ont. Reg. 212/01 contrary to s. 37(1)(a) of the Act to be one of strict liability. I rely here on the framework outlined in R. v. Sault Ste. Marie (City), 1978 11 (SCC), [1978] 2 S.C.R. 1299 and applied in R. v. Kanda, 2008 ONCA 22.
5First, the subject matter of the legislation suggests a strict liability offence. Public welfare offences are presumptively strict liability offences: see Kanda, supra at para. 19. Section 1 of the Act explicitly states a public safety purpose: “the purpose of this Act is to enhance public safety in Ontario by providing for the efficient and flexible administration of technical standards with respect to the matters referred to in section 2.” The matters outlined in s. 2 of the Act include amusement devices, boilers and pressure vessels, elevating devices, fuels, and operating engineers.
6Second, the available penalties for violating s. 37(1)(a) of the Act are severe, which precludes an offence of absolute liability. The available penalties include a maximum fine of $50,000 and/or a term of imprisonment not exceeding 1 year. This applies to both individuals [s. 37(1.1)(a)] and to corporate directors and officers [s. 37(3)]. The maximum available penalty against a corporation is a fine of $1,000,000 [s. 37(b)]. Penalties of this nature do not fit with offences of absolute liability: see R. v. Raham, 2010 ONCA 206 at para. 37; and Kanda, supra at paras. 33-35.
7Finally, the precise language used in s. 37(1)(a) of the Act distinguishes this offence from a mens rea offence. While s. 37(1)(b) of the Act uses the term “knowingly” to create a mens rea offence of furnishing false statements or information, s. 37(1)(a) contains no such term. Nor does s. 15 of Ont. Reg. 212/01. The specific statutory language used, in conjunction with the above factors, makes clear that the offence charged is one of strict liability. As such, it is open to the defendant to proffer a defense of due diligence, which must be established by the defendant on a balance of probabilities: see Sault Ste. Marie, supra at pgs. 373 to 374; and Ontario (Ministry of Labor) v. Sunrise Propane Energy Group Inc., 2013 ONCJ 358 at para. 392.
ii. proof of the actus reus
8The prosecution need only establish the actus reus of the offence to make out its case. The elements of the offence are contained in both the offence-creating section and the relevant section of the regulation. Section 37(1)(a) of the Act reads as follows:
A person is guilty of an offence if the person,
(a) contravenes or fails to comply with any provision of this Act, the regulations, a Minister’s order or an alternate rule;
(b) knowingly makes a false statement or furnishes false information under this Act, the regulations, a Minister’s order or an alternate rule;
(c) contravenes or fails to comply with a term or condition of an authorization; or
(d) contravenes or fails to comply with an order or requirement of a director, an inspector or an assessor or obstructs an inspector. [emphasis added]
9Section 15 of Ont. Reg. 212/01 reads as follows:
An owner or user of an appliance, equipment, a work or any other thing employed in the handling or use of gas shall ensure that the appliance, equipment, work or thing employed in the handling or use of gas is maintained in a safe operating condition.
10Crucially, the focus in this trial must remain on the actions of the defendant in the circumstances. This is true when analyzing both the actus reus of the offence and the defence of due diligence. It is relatively easy to become unmoored in such a case and exclusively seek to determine what “caused” the incident or who is to “blame”. This would be an error: see for example Ontario (Ministry of Labour, Immigration, Training and Skills Development) v. The Econo-Rack Group Inc., 2025 ONCJ 213 at para. 47.
11That said, the prosecution chose to particularize the charge against the defendant in this case. The count reads:
“…failing to comply with section 15 of Ontario Regulation 212/01 (Gaseous Fuels) on or about November 27, 2024 when, as the owner of a natural gas fueled appliance, failed to ensure that the appliance was maintained in a safe operating condition, TO WIT the natural gas fueled pool heater was non-compliant with the CSA/CAN B149 Natural Gas and Propane Installation Code such that it leaked carbon monoxide into the enclosed indoor pool room located at one of Realm of Abodes Inc. residences at 796 Sunset Road, in the City of Burlington, in the Province of Ontario”
As such, the prosecution must not only prove the defendant failed to maintain the pool heater in a safe operating condition, but that it was non-compliant with the relevant code and therefore leaked carbon monoxide into an enclosed indoor space.
12The prosecution presented the viva voce testimony of Technical Standards and Safety Authority (TSSA) fuel safety inspector, Inspector Manchanda. Inspector Manchanda inspected the defendant’s property following the carbon monoxide leak, generated inspection reports, and issued compliance orders.
13Inspector Manchanda testified credibly and reliably in my view. His testimony was candid, internally consistent, and externally consistent. In chief examination he explained that he has worked in the gas industry for approximately 9 years and has been an inspector in the “fuel safety program” for the last 3 years. His role as an inspector is to ensure compliance with relevant fuel safety codes and regulations.
14On November 27, 2024, Inspector Manchanda received a report of a carbon monoxide leak at 796 Sunset Road, Burlington, that resulted in injuries to 3 children. He attended the property along with a TSSA investigator, Enbridge Gas personnel, and third-party contractors for the purpose of an inspection.
15Inspector Manchanda inspected the pool heater and found it to be in an unsafe condition. Inspector Manchanda took photographs of the pool heater, which represent the safety concerns he observed (see exhibit 1).
16First, Inspector Manchanda found that under the burn controls there was rust, soot and corrosion, which would cause problems with proper venting of the heater (see exhibit 1b). Second, Inspector Manchanda found that the heat exchanger was clogged with carbon deposits, blocking the heat exchange fins, which would cause problems with proper venting of carbon monoxide to the outdoors (see exhibit 1c). Third, Inspector Manchanda found that there was a gap between the draft hood and the venting pipe, which could cause carbon monoxide to “spill” into the indoor space (see exhibit 1d). Inspector Manchanda explained that these issues suggest a lack of proper maintenance of the pool heater.
17Inspector Manchanda explained that during his inspection he started the pool heater to test it, and upon doing so, observed smoke emitting from the heater and carbon monoxide in the surrounding space at a reading of 48 ppm., both of which are abnormal. These findings led Inspector Manchanda and his colleagues to conclude that the pool heater was the source of the carbon monoxide leak. He issued orders for the infractions pursuant to s. 21(1) of the Act to both Mr. Baddi and Mr. Kushdeep Gill, who was the gas contractor hired by Mr. Baddi to work on the home’s gas appliances in May 2024. Inspector Manchanda explained that following the investigation Mr. Gill was charged and fined $20,000 in relation to this incident.
18Inspector Manchanda also testified that, based on his knowledge of the pool heater involved (Raypack pool heater, model D-R206A-MN-C) and its user manual, maintenance of the appliance is required to be completed every 6 months. However, no user manual was tendered by the prosecution to confirm this.
19In cross examination, Inspector Manchanda agreed that Mr. Gill missed both “immediate” and “non-immediate” hazards that were within his “line of sight” of the home’s gas appliances when he worked on them in May 2024. Inspector Manchanda captured these violations in his inspection report.
20The defendant tendered several documents, admitted on consent, that capture the infractions found on November 27, 2024, and the orders made by Inspector Manchanda and his colleagues (see exhibits 2 to 5). Inspector Manchanda authored 2 inspection reports detailing orders made to Mr. Gill (report 1) and Mr. Baddi (report 2).
21Report 1 outlines various non-compliance infractions related to the pool heater, the water heater, and the furnace. The report states that Mr. Gill, as a licenced technician, failed to identify hazards that were within his line of sight, including immediate hazards from the pool heater. The report describes some of these hazards as violating the “CAN/CSA-B149.1 Natural Gas and Propane Installation Code”. A total of 12 orders were issued to Mr. Gill by Inspector Manchanda. Report 2 outlines the same non-compliance infractions and contains many of the same orders; a total of 23 orders were issued to Mr. Baddi by Inspector Manchanda. Both reports corroborate the testimony of Inspector Manchanda.
22Mr. Baddi also testified in this trial. I found Mr. Baddi to be credible and reliable. He was candid, internally consistent, and externally consistent. In chief examination, Mr. Baddi explained that he is a director of Realm of Abodes Inc., which runs 3 short-term rental properties including the home at 796 Sunset Road, Burlington. He testified that his company purchased the property on May 15th, 2024. The seller(s) of the property informed him that the “furnace” and “AC” were “on their last legs” and needed to be replaced. Mr. Baddi immediately hired Mr. Gill to do the work after ensuring that he was a “G2” licenced gas technician. Mr. Baddi confirmed this on the TSSA website where Mr. Gill was listed.
23Mr. Baddi asked Mr. Gill to look at the furnace and the “other gas appliances” in the home, but did not provide him with specific instructions regarding the pool heater. Mr. Baddi understood that Mr. Gill would look at “any appliances connected to gas” and notify him of any safety issues. Mr. Gill attended the property on May 16th, 2024, to do his work and was provided “full access to the property” by Mr. Baddi. Following his work, Mr. Gill did not notify Mr. Baddi or Realm of Abodes Inc. about any safety issues with the pool heater or any required maintenance of the pool heater.
24In cross-examination, the prosecution suggested that Mr. Baddi was not responsible for maintaining Realm of Abodes Inc.’s properties, rather this was the role of his co-host “Ali”. Mr. Baddi rejected this suggestion. The prosecution also put to Mr. Baddi that he did not have anyone under contract to maintain the pool heater in the 6-month period between his purchase of the property and the incident. Mr. Baddi responded that he hired Mr. Gill to look at all gas appliances and expected that Mr. Gill would have notified him of required pool heater maintenance; he agreed he did not have a dedicated pool heater serviceperson in this period.
25After considering the above evidence, all of which I accept, I find that the prosecution has proven the actus reus of the offence beyond a reasonable doubt. The elements of the offence are relatively straight forward. The evidence establishes that Realm of Abodes Inc. owns the pool heater at 796 Sunset Road, Burlington; that the pool heater was fueled by natural gas; that it was not maintained in a safe operating condition pursuant to the requirements of the relevant code; that the pool heater leaked carbon monoxide into an indoor space of the home; and that the duty rested with the defendant, as the owner of the appliance, to ensure the appliance was safe. The defendant failed in this respect.
iii. The defence of due diligence
26The defendant argues a defence of due diligence. The defendant submits that as a layperson, the only reasonable action Mr. Baddi (as director of Realm of Abodes Inc.) could have taken in the circumstances was to hire a licenced and qualified gas technician and rely on him to fix, or at least identify, any safety issues with the gas appliances. The defendant argues that this is what the regulatory scheme demands and it would be unjust to punish a home owner for the failings of a licenced technician who ignored his professional obligations. Furthermore, the defendant submits that Mr. Baddi took additional reasonable steps to ensure safety at the property by immediately replacing an aged furnace, and by installing and maintaining carbon monoxide detectors.
27The defendant further submits that Mr. Gill observed that the pool heater was unsafe in May 2024 and ought to have identified this to Mr. Baddi at the time. By failing to do so, according to the defendant, Mr. Gill left Mr. Baddi with the mistaken but reasonable belief that the pool heater was in a safe operating condition. The defendant highlights that the carbon monoxide leak took place just over 6 months after Mr. Gill worked on the gas appliances, and argues that this is a period during which it was reasonable for Mr. Baddi to assume the pool heater continued to be safe.
28The prosecution submits that as the owner of the pool heater the defendant had the ultimate duty to ensure it was safe, regardless of Mr. Gill’s errors. The prosecution points to s. 15 of Ont. Reg. 212/01, which contains clear language directed at “owners” and “users” of gas appliances (see above).
29The defence of due diligence as framed by Dickson J. in Sault Ste. Marie, supra, at pg. 374 is made up of two branches: “The defence will be available if the accused reasonably believed in a mistaken set of facts which, if true, would render the act or omission innocent, or if he took all reasonable steps to avoid the particular event.” The defence is based on an objective standard, as “it requires consideration of what a reasonable person would have done in similar circumstances.”: see Québec (Autorité des marchés financiers) c. Souveraine, compagnie d’assurance Générale, 2013 SCC 63.1
30Importantly, the second branch operates independently of the first, as explained in R. v. MacMillan Bloedel Ltd. (2002), 2002 BCCA 510, 220 D.L.R. (4th) 1732:
Thus, there are two alternative branches of the due-diligence defence. The first applies when the accused can establish that he did not know and could not reasonably have known of the existence of the hazard. The second applies when the accused knew or ought to have known of the hazard. In that case, the accused may escape liability by establishing that he took all reasonable care to avoid the “particular event”.
31Where the court is satisfied that the first branch of the defence is established the court need not embark on the second branch.3 However, in certain cases, both branches may be established by the facts: see R. v. Ellis Don Corp., 2006 ONCJ 590 at para. 46.
32When analyzing due diligence, courts have considered numerous factors that have evolved over time. In Toronto (City) v. Bleta, 2003 CarswellOnt 1613 at para. 74, Quon J.P. outlines several relevant factors:
In his reference manual"Libman on Regulatory Offences in Canada" (Salt Spring Island, B.C.: Earlscourt Legal Press Inc., 2002), at p. 7-11, Justice Libman gives an overview of the factors to consider in the due diligence inquiry:
The determination of whether a due diligence defence exists necessitates a weighing and balancing of numerous considerations which may be relevant to any particular case. In R. v. Commander Business Furniture Inc., Hackett J. noted that the following factors have been identified by the courts in assessing the due diligence defence:
(1) the nature and gravity of the adverse effect;
(2) the foreseeability of the effect, including abnormal sensitivities;
(3) the alternative solutions available;
(4) legislative or regulatory compliance;
(5) industry standards;
(6) the character of the neighborhood;
(7) what efforts have been made to address the problem;
(8) over what period of time, and promptness of response;
(9) matters beyond the control of the accused, including technological limitations;
(10) skill level expected of the accused;
(11) the complexities involved;
(12) preventative systems;
(13) economic considerations; and
(14) actions of officials.
This list of factors has been referred to as a “shopping list or signposts” because not all factors will be directly applicable in any one case or area of regulatory law.4
33In my view, the bulk of these factors best assist with analyzing the second branch of the due diligence defence, where all reasonable care to avoid a “particular event” is at issue. In this case, that event is the leaking of carbon monoxide into an indoor space. What is central here however, is the first branch of the due diligence defence: whether the defendant knew or reasonably could have known of the existence of the hazard - the hazard being an unsafe pool heater.
34Some of the factors listed above are helpful in this analysis, particularly the factors of “foreseeability”, “regulatory compliance”, “skill level expected of the accused”. Their application helps to determine whether it was objectively reasonable that the defendant held a mistaken belief (not merely that the defendant was well-meaning and subjectively held a mistaken belief), which is necessary to make out the defence of due diligence: see Sunrise Propane, supra, at para. 367.
35First, as the owner and operator of short-term rental properties, the defendant has an obligation to ensure that the properties are safe to the public. Where those properties contain gas fueled appliances, the defendant has an obligation to inform itself of the state of the appliances and whether they are safe. Section 15 of Ont. Reg. 212/01 makes clear that the safety of gas fueled appliances is the responsibility of owners and users.
36Mr. Baddi took steps in this regard when he engaged with the seller(s) of 796 Sunset Road, Burlington, to ascertain that the furnace and air conditioner needed to be replaced. Mr. Baddi’s testimony reveals that the seller(s) did not inform him of the need to replace the pool heater. Arguably, Mr. Baddi should have went further and sought to determine from the seller(s) whether the pool heater also needed to be replaced.
37Second, based on the information he received from the seller(s), Mr. Baddi took immediate steps to retain a “G2” licenced gas technician to replace the furnace and examine the other gas fueled appliances in the home. Mr. Baddi informed himself of the licencing status of the technician, Mr. Gill, by searching Google and viewing the TSSA website, where he confirmed that Mr. Gill was properly licenced. These steps satisfied Mr. Baddi that a qualified professional would examine all the gas appliances.
38Importantly, s. 5 of Ont. Reg. 212/01 prohibits any person who is not a holder of a licence from “handling gas”5. Thus, Mr. Baddi was prohibited from working on the pool heater himself and was obligated to hire a licenced technician. Furthermore, Mr. Baddi was clear in his testimony that he knows nothing about gas appliances, which is unsurprising of a layperson.
39Third, Mr. Baddi instructed Mr. Gill to look at the gas appliances in the home and provided Mr. Gill with full access to the property for this purpose. Arguably, Mr. Baddi should of provided Mr. Gill with explicit instructions to examine the safety of the pool heater. Nevertheless, Mr. Baddi understood that Mr. Gill did examine all gas appliances and did not raise any safety concerns with them. This is supported by Inspector Manchanda’s report against Mr. Gill, which demonstrates Mr. Gill had line of sight to the pool heater in the course of his work and failed to note immediate safety hazards.
40Finally, the defendant had approximately 20-25 guests at the property in the approximately 6 months following its purchase and no safety issues were noted with the pool heater. Had there been a leak of carbon monoxide, this would have been revealed by 5 new carbon monoxide detectors that the defendant installed.
41As noted, I must apply an objective standard and consider what a reasonable person could have known in the circumstances. In this context, a “reasonable person” is a reasonable landlord or business like Realm of Abodes Inc. offering short-term rentals to the public.
42While I find that the defendant could have taken additional steps to ensure safety at the property, in all the circumstances, the defendant could not have reasonably foreseen that the pool heater was unsafe. I therefore conclude that, on a balance of probabilities, the defendant has established a reasonable belief in a mistaken set of facts – that the pool heater was maintained in a safe operating condition – which renders the defendant’s omission innocent.
43There is no need for me to analyze the second branch of the due diligence defence.
C. Conclusion
44This case demonstrates that property owners must be vigilant to ensure gas appliances are safely maintained and cannot always rely on contractors to do so. It is fortunate that the 3 children poisoned by carbon monoxide in this case were not more seriously injured. This is almost certainly the result of properly installed and maintained carbon monoxide detectors, which reveals how important they are.
45The defendant is acquitted of the charge.
T.J. Howard, Justice of the Peace
Footnotes
- See Kenneth E. Jull & Todd L. Archibald, Profiting From Risk Management and Compliance (Toronto: Carswell, 2019),ch. 9:2, at 1
- Supra, ch. 9:6, at 1.
- Supra; and see Ontario (Ministry of Labour) v. North Bay General Hospital, [2007] O.J. No. 3374 (C.J.), at paras. 50-51
- Supra, ch. 9:8, at 1
- “handling” is defined in s. 1 of Ont. Reg. 212/01 as follows: “handling” means the transmission, transportation or distribution of gas, or the storage of gas in a container, and “handle” and “handler” have corresponding meanings.