Licence Tribunal Appeal d'appel en Tribunal matière de permis

DATE: 2010-06-21

FILE: 5808/ONHWPA

CASE NAME: 5808 v. Tarion Warranty Corporation

An Appeal of a Decision of Tarion Warranty Corporation under the Ontario New Home Warranties Plan Act – to Disallow a Claim

Applicant Applicant

-and-

Tarion Warranty Corporation Respondent

-and-

Master Custom Homes Inc. and Amirali Nasseri Added Party

REASONS FOR DECISION AND ORDER

ADJUDICATOR: KEN SELBY, Presiding Member

APPEARANCES:

For the Applicants: APPLICANT, unrepresented

For the Respondent: NEIL ABBOTT, Counsel representing Tarion Warranty Corporation

For the Added Party: SHADI NASSERI, Counsel representing Master Custom Homes Inc. and Amirali Nasseri, Added Party

Heard in Toronto: May 10, 11 and 19, 2010

DECISION AND ORDER BACKGROUND

This is an appeal to the Licence Appeal Tribunal (the “Tribunal”), from a written decision letter of Tarion Warranty Corporation (“Tarion”) dated November 30, 2009, wherein the claim of the Applicant was denied Exhibit 2 (Ex. 2).

This appeal is with respect to a Second-Year Warranty period. The issues to be addressed are items 1 to 10 as outlined in the Tarion decision letter (Ex. 1). In addition, item 7 from the Warranty Assessment Report is also to be considered.

The Warranties covered under the Ontario New Home Warranties Plan Act are defined and described in Tarion’s Assessment Results (Ex. 4 Tab 11 pages 3 and 4). The Second-Year Warranty coverage is outlined on page 4 of that Tab.

On the Notice of Appeal Form, the Applicant indicated that he would require two days to present his case and he expected to call three expert witnesses. The Tribunal commenced the hearing on May 10, 2010. The Applicant had no expert witnesses available on the first day so the hearing lasted approximately one-half day. He agreed that he would attempt to have two expert witnesses present the following day. On May 11, 2010, the Applicant was only able to bring one expert witness. At the end of day two it was agreed that the Applicant would bring his second, and final, expert witness for the next scheduled day (May 19, 2010).

Motion:

At the start of the third hearing day the Applicant did not bring his expert witness as had been agreed. Rather he brought a Motion (Ex. 20). In essence the Applicant argued that the Tribunal was not properly controlling Tarion’s Counsel and it was always ruling in favour of Tarion’s counsel on matters of procedure. Furthermore the Applicant expressed the following concern

“about the ability of the Tribunal to render a fair and impartial decision…”

The Applicant expanded on these concerns with 16 numbered paragraphs (Ex. 20 Tab 2). The Tribunal ruled orally to dismiss the motion for reasons given that day. Below the Tribunal provides further and more detailed response to the grounds, using the numbering of the motion.

Ground 5. The hearing record will show that the Tribunal stated that some of the items seemed inappropriate for a Second-Year Warranty. The example mentioned by the Tribunal was some cracked plaster next to the crown moulding. The Ontario New Home Warranties Plan Act (“ONHWPA”) in Section 13 (1) indicates what is warranted and in Section 13 (2) lists 12 exclusions one of which follows:

(d) “normal shrinkage of materials caused by drying after construction”

Not even in the first-year does Tarion warrant such shrinkage cracks.

Ground 6. It is not clear how this paragraph relates to the testimony. The Tribunal was not made aware of any agreements made at the pre- hearing. Homes are warranted to be free from violations of the Ontario Building Code (OBC), if properly reported, in the first two years.

Ground 7. The Tribunal is well aware that the ONHWPA, in Section 13 (1) warrants to the owner that:

“the home is (iii) constructed in accordance with the Ontario Building Code;”

The record will show that the Applicant has attempted to frame several of his concerns as building code and/or health and safety matters.

Ground 8. The Applicant argues that Tarion’s counsel was controlling the process and the Tribunal was failing to adequately control the hearing. The Applicant complained when he was asked to stop assisting/prompting his expert witness during the testimony of the witness and to return to the position generally occupied by Applicants and counsel at the counsel table.

Ground 9. The Tribunal believes the number of 2 1/2 hours to qualify the Applicant’s first witness is a significant exaggeration. Later that day about an hour was lost while the Applicant labelled a few photographs.

Ground 10. The Respondent’s cross-examination was not particularly unusual. Ground 11. While testifying the expert witness started to refer to a file folder,

which contained papers other than his expert report. Tarion’s Counsel asked to examine these papers (not his entire briefcase as stated). The Tribunal ruled that a short break would occur while the Respondent and the Added Party could examine these papers which had not been previously disclosed as required by the Licence Appeal Tribunal ("LAT") Rules. The Applicant was extremely upset with this ruling.

Ground 12. The expert witness wished to offer opinion evidence regarding violations of the OBC and allegedly had some related documents on the witness stand. While qualifying this witness, he was asked by the Respondent’s Counsel what Section 9 of the OBC concerned. It was clear that the witness had no idea. He was also asked about Section 4 of the OBC. Again he had no response. This expert's report made no mention of the OBC and the Licence Appeal Tribunal requires that expert evidence be shared with the other parties 30 days in advance of the hearing (LAT Rule of Practice 6.4.3 (a)). There is no sub-clause Article 9.30.6.1.2.3.4 in the OBC, however article 9.30.6.1 deals with ceramic tile. This hearing is dealing with marble tiles, a natural stone product, not ceramic tiles. The expert was not considered to be qualified as an expert on the OBC.

Ground 13. The expert report made no mention of any health and safety concerns so the request by Tarion’s Counsel to exclude testimony of the witness on such matters was granted.

Again, if this issue was to be addressed, information had to be disclosed a month in advance according to the LAT Rules of Practice. The Applicant was very upset with this restriction.

The Respondent and the Added Party, who had their witnesses present, were opposed to this Motion of the Applicant.

According to the LAT Rules the Tribunal had two choices.

(a) the hearing could be adjourned and a new member assigned, as requested by the Applicant, or

(b) the hearing could continue.

The remaining witness for the Applicant had disclosed his report (Ex. 4 Tab 15) which dealt exclusively with estimated costs to make the various repairs associated with the claims of the Applicant. This information could be useful only in the event that some of the items were warranted. The Tribunal dismissed the Motion. Two days of the Applicant’s hearings were complete and the other parties were ready to continue. The Tribunal ruled that the hearing should continue.

The Applicant had been advised (Ex. 20, Tab 2D) by the Chief Administrative Officer and Registrar

“However, if the panel does not agree to your requests, the hearing will proceed and the parties are to prepare themselves, accordingly.”

At this point the Applicant who did not have his remaining expert witness present chose to leave the hearing. Tarion called two witnesses to testify, and the hearing was completed by the end of the third hearing day (May 19, 2010).

Evidence of the Applicant

1. Claim “From 21h floor to 11th floor (sic) through the bathroom – water penetration.” See Ex. 4 Tab 13 for first 10 claims.

Water had come from 2nd floor bathroom to 1st floor. There were two glass panels to contain shower water for the second floor tub (two photos Ex. 5 Tab 7). The one which acted as a door was at the end of the tub with the shower head. The Applicant had been advised that these panels should have been installed with the door remote from the shower head. There was no evidence presented that water had flowed under the glass door.

2. Claim “The marble flooring from the front door inside into the foyer/vestibule all the way to the kitchen area is loosen (sic) and moves when walked on. It will beed to be repair” (sic).

The Applicant provided a number of photographs showing cracked marble tiles, missing or cracked grouting (Ex. 5, Tab7). He copied many provisions of the 1997 OBC in Ex. 6. The Applicant suggested that the underlying floor framing was inadequate and not providing the sub-flooring strength required by the OBC (see Ex. 6, Tab 3, article 9.23.14.1). The Applicant more specifically referred to article 9.30.6.3 which provides in clause (1) (b) that the sheathing thickness must confirm to Table 9.23.14.5. A or B.

There was evidence presented of several loose or cracked tiles and the Applicant claimed this was a safety issue. An expert witness was to testify on this marble tile installation.

3. Claim “There are cracks in the front of the building around the windows”.

The Applicant noted a number of small cracks around the building adjacent to the windows. He expressed concern that water could enter these cracks and damage the inside of the house.

4. Claim “There are cracks in the rear of the building around the windows” This is similar to the previous Claim but it refers to the rear of the home.

5. Again this claim is similar to the two previous claims; however an effort to caulk these joints has been made by the builder. The concern expressed was mainly that the colour of the caulking was inappropriate. There was minor evidence of some cracks remaining after the repair (Ex. 5, Tab 7). There was no evidence of water damage.

6. Claim “The bricks in front of the outside door from the basement are not level and are retaining and accumulating water”.

The evidence was that this area had pavers which were generally sloped toward a drain. It appears that the drain was connected to the weeping tile system of the house which was a short distance below. The Applicant claimed that this area did not drain properly and it became dangerous in winter (two photographs Ex. 5, Tab 7).

7. Claim “The frame door of Den from the Outside is cracked and damaged and the paint has worn off”.

The Applicant indicated that the exterior door jamb was damaged.

8. Claim “Crown moulding is cracked in master bedroom a few places”

The Applicant indicated that a crack adjacent to the crown moulding occurred on the west wall of the master bedroom (Ex. 5, Tab 7).

9. Claim “The lenses of two lights in the kitchen are has (sic) been crooked and broken”

A photograph of one such broken lens is shown in Ex. 7.

10. Claim “There was no screen door on the kitchen garden door, therefore insects entering inside the house and causing health issues to my family members, especially two minor kids”

The Applicant was relying upon the OBC article 6.2.3.12 “Supply, Return, Intake and Exhaust Air Openings” (see Ex. 6, Tab 4 sentence 6.2.3.12 (3) which is highlighted). This calls for screens on all such air openings. The Applicant was applying this OBC clause to a French door at the rear of the home. See also the highlighted sentences 9.32.3.12 (8) and 6.2.3.12 (3) in Ex.

6, Tab 4.

11. Claim “There is severe discoloration on the front door”.

Photographs marked Exs. 8, 9 and 11 show the front door in question. The Applicant claims the colour shown in Ex. 9 is distinctly different from the colour shown in the other photographs.

Expert Witness - Domenik Zavarella

Mr. Zavarella has 28 years of experience in the tile industry. Most of his experience has been in various sales capacities. For the past two years he has had a contract as a Technical Consultant with Terrazzo, Tile & Marble Association of Canada (“TTMAC”). In this role Mr. Zavarella conducts field inspections and writes reports addressing technical questions. About 70 percent of his assignments relate to commercial projects and 30 percent to homes.

On December 19, 2009, Mr. Zavarella visited the subject home for several hours. He observed slate tile on the porch and the marble tile on the interior as well as in the first and second floor bathrooms. He wrote a report which can be found in Ex. 5, Tab 4. It is common practice to share such reports with other TTMAC consultants. Exhibits 15, 16

& 17 are replies from other consultants indicating that Mr. Zavarella's report is well written.

The first paragraph of Mr. Zavarella’s report, which is entitled Reason for Inspection, indicates the homeowner’s main concerns.

“The homeowner is specifically concerned about the suitability of the exterior “slate” stone tile to withstand freeze thaw cycling and whether the installation method of the interior natural stone has been done in accordance with industry and TTMAC standards.”

At the hearing there was no evidence presented regarding the slate on the front porch. Mr. Zavarella observed the tiles in the kitchen and front hall area. He said these marble

tiles were class C marble and they were polished and bevelled. As well the beam and

joist system was observable in a small portion of the basement. He observed the joists were on 16 inch centres. In addition, he removed a heating duct register, as seen in Ex. 5, Tab 7, in order to observe the support system.

With the aid of photographs (Ex. 5, Tab 7), Mr. Zavarella noted: cracked tiles, broken tiles, fissures, as well as missing, excessive and cracked grout. In addition, one tile was formed with two pieces while a single tile should have been used. He estimated that 20 to 30 percent of the tiles had deficiencies. It was also stated that it was extremely difficult to match the marble colour if one was intending to replace only those tiles having deficiencies.

The thickness of the plywood support was measured as 5/8 of an inch and he stated that TTMAC standards would require two sheets of such plywood to support these marble tiles. Mr. Zavarella suggested that the joist spacing of 16 inches on centre was not adequate to meet the OBC. He said that 12 inches on centre would be the required joist spacing to meet the Building Code.

On cross examination, Mr. Zavarella agreed that ideally at least one tile should have been removed to better understand the typical marble tile installation. He said that he was not allowed to remove a tile.

The Respondent presented the two witnesses who were present. Witness - Roger Boyd

Mr. Boyd has been a Field Claims Representative for Tarion for the past five years during which time he has examined over 200 homes. He wrote the Warranty Assessment Report which was in response to the issues of concern presented by the Applicant.

Mr. Boyd briefly outlined the one-year, two-year and major structural defect warranties. His Assessment Report indicated that none of the items were deemed to be eligible for the Second-Year Warranty. Mr. Boyd explained how he arrived at his conclusions as expressed in his decision letter (Ex. 3, Tab 17).

1. Claim Water Leakage - This was not a water penetration matter as intended by the Second-Year Warranty which speaks of water penetration through the building envelope. Some water had flowed from the second floor bathroom to the first floor room which was immediately below. The evidence was that the Applicant had the damaged ceiling repaired by another contractor.

2. Claim That many of the marble tiles were loose or broken and in need of repair. Mr. Boyd's evidence was that there were some cracked tiles (perhaps 2 percent or 10 -12 tiles) and some loose grout. Again Mr. Boyd stated this was not a Second-Year item and clearly the few tiles with excessive grout were obvious when the home was first occupied.

Mr. Boyd pointed out that the pattern of the few cracks that exist is not consistent with the joists being too far apart. Furthermore Ex. 19 had been stamped by the City of Toronto, Building Department as:

“reviewed for compliance with the Ontario Building Code”.

This document also notes that the sub-floor which was 5/8” plywood which was both nailed and glued.

3, 4 & 5 Claim All three items relate to cracks around doors and windows.

Mr. Boyd pointed out that it is common to have minor cracks around masonry units. The design allows for some water to penetrate the masonry walls and flow down to the weep holes where it exits the building. Water penetration through the building envelope, including the basement, is warranted as a Second-Year item. The Applicant provided no evidence of external water entering his home.

6. Claim Pavers at the basement level seemed not to be draining properly.

Mr. Boyd conducted two separate water tests (one in the presence of Mr. Robillard). A hose was used to flood this area for 10 minutes and then the area was allowed to drain. The draining took about 7 minutes for the water to leave mostly by way of the drain. The drain appeared to be connected to the nearby weeping tiles system and it was working properly.

7. Claim The door to the den is cracked, damaged and in need of some paint.

Mr. Boyd examined this door from 3 metres away and could see no defects in workmanship or materials. This did not amount to deterioration consistent with a breach of the Second-Year Warranty.

8. Claim Crown moulding is cracked in master bedroom in a few places.

Mr. Boyd stated that these cracks were normal shrinkage cracks which are never warranted by Tarion.

9. Claim The plastic lenses of two fluorescent fixtures used for under cupboard lighting are broken (Ex. 7). Mr. Boyd noted that source of the damage could not be determined. Again this is not a Second-Year Warranty item in any case.

10. Claim There is no screen on the back door.

Mr. Boyd indicated that there was no provision for a screen on this door. The Applicant used OBC article 6.2.3.12 which deals with intake and exhaust air openings to justify this claim.

11. Claim There is severe discolouration on the front door.

Exs. 8, 10 and 11 show photographs of this front door. Ex. 11 shows the steel door as a uniform brown colour. Photographs 8 and 9 show a significant colour difference.

Mr. Boyd stated that there was clear evidence that part of the door had been sanded. Indeed there was still evidence of some tape on the door. Again this was not a Second- Year Warranty item.

Witness - Khristian Robillard

Mr. Robillard offered evidence of the cost of addressing the above 11 claims with no comment as to whether the claims should be warranted (Ex. 6 Tab 5).

THE LAW

Regulation 892 under the Act defines the Second-Year Warranty as covering the following five areas:

1. Water penetration through the basement or foundation walls;

2. Defects in materials, including windows, doors and caulking, or defects in work that result in water penetration into the building envelope;

3. Defects in work or materials in the electric, plumbing and heating delivery and distribution systems;

4. Defects in work or materials which result in the detachment, displacement or deterioration of exterior cladding (such as brickwork, aluminums or vinyl siding); and

5. Violations of the Ontario Building Code affecting health and safety (indluding, but not limited to, violations relating to fire safety and the structural adequacy of the home).

APPLICATION OF THE LAW TO THE FACTS:

The onus rests on the home owner to prove that the vendor/builder has breached its warranties under the Act. Since this is a Second-Year Warranty any breach must involve one of the five areas noted above.

1. There was no evidence of any water penetration through the basement or foundation walls.

2. Minor cracks appeared in some of the masonry. This is common and the masonry design using the rain screen approach causes any water entering the wall to exit by way of the weep holes at the bottom of the masonry units. Interior water spillage from the bathroom is never part of this warranty program.

3. The pavers appeared to be draining properly based on two water tests.

Shrinkage cracks in moulding are not uncommon and are never warranted. A defect in the door must be visible from 3 metres and the evidence was that it was not. The OBC article 6.2.3.12 was never intended to apply to screens on a back door. Rather it deals with intake and exhaust air openings such as vents.

4. Cracked lenses for under counter florescent lights could have occurred any time during the two year period. Some caulking around the door had been replaced and the concern seemed to be the choice of colour. There was some evidence that the homeowner was involved in the colour choice. The evidence of the discolouration of part of the front door related to some home owner activity according to two witnesses.

5. The tiles had a few cracks, some loose grout and some poor workmanship. Article 9.23.14.5 which was referred to by the owner was not relevant as clause (3) causes that article not to apply as this involves tiles attached to a concrete topping. The engineered joist system were 9- 1/2" AJS20 on 16" o/c so the clear span was even less than normal as the flanges were 2" x 3". The City of Toronto, Building Department had indicated that the design was consistent with the OBC. This engineered system would have less deflection, both longitudinally and laterally, than a conventional floor. This should reduce possible movement of these marble tiles. There was no indication that the design had to meet the TTMAC standards referred to by the expert witness.

The Tribunal concludes that the Applicant has not proved any of the claims on the balance of probabilities. The Tribunal therefore, orders Tarion Warranty Corporation to deny the claim.

DECISION

The Tribunal finds that none of the Applicant's claims is warranted within the Second- Year Warranty provisions of Regulation 892 of the Act. Therefore, by virtue of the authority vested in it under section 16(3) of the Act, the Tribunal directs Tarion to deny the Applicant’s claim on the eleven matters associated with the Applicant's claim in this appeal.

LICENCE APPEAL TRIBUNAL

Ken Selby Presiding Member

Released: June 21, 2010