Licence Tribunal

Appea d'appel en

Tribunal matière de permis

DATE:

2014-01-08

FILE:

7699/ONHWPA

CASE NAME:

7699 v. Tarion Warranty Corporation

An Appeal of a Decision of Tarion Warranty Corporation under the Ontario New Home Warranties Plan Act, R.S.O. 1990, c. O. 31 – to Disallow a Claim

Applicants

Applicants

-and-

Tarion Warranty Corporation

Respondent

-and-

Minto Communities Inc.

Added Party

REASONS FOR DECISION AND ORDER

ADJUDICATOR:

Douglas R. Wallace Vice-Chair

APPEARANCES:

For the Applicants:

self-represented

For the Respondent:

Sophie Vlahakis, Counsel

For the Added Party:

Stephen P. Shaddock, Counsel

Heard in Ottawa:

December 3, 4 and 5, 2013

REASONS FOR DECISION AND ORDER

THE FACTS

The Applicants purchased a lot and single-family dwelling to be built on it by the Added Party under Agreement of Purchase and Sale dated August 3, 2010. They took possession of their new home on October 26, 2011 and submitted a 30-day Warranty Form on November 24, 2011. The Respondent (Tarion) inspected the home in May 2012 and issued a Warranty Assessment Report (WAR) in June 2012. The WAR and the subsequent Decision Letter dealt with over 180 items. Only six of these items were contested before the Tribunal.

The items in dispute were as follows:

1. The four columns holding up two decks at the rear of the house were square rather than round as provided in the Agreement of Purchase and Sale (APS).

2. Two complaints concerning height in the basement:

(a) the height between the top of the basement floor and the bottom of the floor joists.

(b) headroom clearance between the top of the stairs coming down into the basement from the ground floor and the beam crossing above the stairs.

3. A lack of insulation provided inadequate protection from the noise of airplanes passing overhead.

4. The location of an air conditioner at the rear of the house within inches of a fence.

5. Dirt and construction debris in the furnace air ducts.

6. The installation of a water faucet on the master en suite bath.

In addition to the documentary evidence filed as exhibits, the Tribunal heard from three witnesses; the male applicant (the Applicant), the Warranty Service Representative for Tarion and a long-term employee of the Added Party (the Builder).

THE LAW

The warranties set out for new homes are set out in the Act as follows:

Warranties

13. (1) Every vendor of a home warrants to the owner,

(a) that the home,

(i) is constructed in a workmanlike manner and is free from defects in material,

(ii) is fit for habitation, and

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

(b) that the home is free of major structural defects as defined by the regulations; and

(c) such other warranties as are prescribed by the regulations. R.S.O. 1990, c. O.31, s. 13 (1).

The warranties are subject to certain exclusions which are not relevant to this case.

Compensation

14 (3) Subject to the regulations, an owner of a home is entitled to receive payment out of the guarantee fund for damages resulting from a breach of warranty if,

(a) the person became the owner of the home through receiving a transfer of title to it or through the substantial performance by a builder of a contract to construct the home on land owned by the person; and

(b) the person has a cause of action against the vendor or the builder, as the case may be, for damages resulting from the breach of warranty. 1998, c. 19, s. 185 (1); 2000, c. 26, Sched. B, s. 15 (3, 4).

A homeowner’s right to appeal a decision by Tarion and the Tribunal’s powers on hearing that appeal are set out in section 16 of the Act as follows:

Notice of decision under s. 14

16. (1) Where the Corporation makes a decision under section 14, it shall serve notice of the decision, together with written reasons therefor, on the person or owner affected. R.S.O. 1990, c. O.31, s. 16 (1).

Notice requiring hearing

(2) A notice under subsection (1) shall state that the person or owner served is entitled to a hearing by the Tribunal if the person or owner mails or delivers, within fifteen days after service of the notice under subsection (1), notice in writing requiring a hearing to the Corporation and the Tribunal. R.S.O. 1990, c. O.31, s. 16 (2).

Powers of Tribunal

(3) Where a person or owner gives notice in accordance with subsection (2), the Tribunal shall appoint a time for and hold the hearing and may by order direct the Corporation to take such action as the Tribunal considers the Corporation ought to take in accordance with this Act and the regulations, and for such purposes the Tribunal may substitute its opinion for that of the

ISSUE

The issue in this case is whether Tarion acted properly in deciding that the complaints by the Applicants fell outside the statutory warranties set out above.

EVIDENCE

THE SUPPORTING COLUMNS AT THE REAR OF THE HOUSE (claim 12)

The Applicant stated that there are four columns supporting two rear decks at the back of the house. It was his intention that the columns would be round to match the columns at the front of the house. This intention was discussed with Builder’s sales representative and clearly expressed in Form 37789 signed by the parties on the August 3, 2010.

In cross-examination, the Applicant agreed that on the same date that he signed Form 37789 he signed Form 37790 and the APS which incorporated both Forms. Form 37790 makes no reference to the shape of the columns but refers to an attached plan that indicates the rear columns to be square

BASEMENT HEIGHT (claim 13)

(a) Height between the basement floor and the 1^st storey floor joists

Before settling on the home model to be built on the lot they were purchasing, the Applicants made it clear to the Builder that they wanted a 9 foot basement ceiling. The Applicant’s oral testimony in this regard was not contradicted by the Builder and is corroborated to some extent by a written document in which the Builder indicated that another model home they were interested in could be modified to meet their requirements by adding among other things a basement “poured at 9 feet high.” (2,743.2 mm).

It was the Applicant’s evidence that the height of the basement as built was only 8 feet 4 inches to 8 feet 6 inches and the lower ceiling reduced the value of his home. In support of his evidence as to the basement height he filed a report by Affiliated Property Group which found that the Builder’s plans called for 2975 mm between the elevation of the basement floor slab and the elevation of the ground floor. He measured this distance in the home as built to be only 2870 mm plus an estimated 40 mm for the thickness of the ground floor for a total of 2910 mm or 65 mm less than shown on the plans.

Tony Stinson has been a Warranty Service Representative with Tarion for five years. He has had 30 years construction experience including over 20 years in residential construction. His training includes approximately one year working with a senior site inspector, taking training in the interpretation and application of the Ontario Building Code, and many years of site inspections. Mr. Stinson pointed out that the relevant clause of this Agreement, found under the heading “CONCRETE” on page one of Schedule 3 states: “poured concrete footings and foundation walls (8’-10” high around basement.)” He explained that the term “foundation wall” refers to the distance between the top of the footing and the underside of the ground floor plate and stated that he had calculated that distance to be 8 feet 10 inches by measuring from the underside of the joists to the top of the basement floor and adding on 3 inches for the approximate distance of the footing under the floor. He noted that a report by ST Engineering filed as an exhibit indicated this distance to be 2685 mm or 8 feet 9.7 inches and noted findings in the Affiliated Property Group report supported these measurements. In his opinion increasing the basement clearance distance by 3.5 inches as requested by the Applicants would cost $60,000 to $80,000.

Luc Bouchard has been employed by the Builder for a total of 17 years; 5 years as site foreman and the last 12 years as Director of Master Care. He confirmed Mr. Stinson’s definition of the term “foundation wall” and the measurements set out in the ST Engineering report.

(b) Height of supporting beam over stairs

The Applicants introduced a report by the Affiliated Property Group indicating that there was only 1882 mm of clearance between the top of the stairs and a beam supporting the ground floor above the stairs. As the minimum clearance required by the OBC is 1950 mm the clearance in this case fell 68 distance below the prescribed minimum. The deficiency would be even greater if the basement were to be finished.

Mr. Stinson also measured the clearance between the beam and the stairs. He explained that he did so by following the method prescribed by the Ontario Building Code (OBC) and introduced a photograph showing how he carried out his measurement. It was his evidence that the Code requires a minimum clearance of 1950 mm and that the clearance when measured in accordance with the methods prescribed by the Code varied from a maximum of 2232 mm at the centre line of the stairs to a minimum of 1995 mm when measured closer to the inside of the railing. In no case was there less than 45 mm in excess of the Code requirements.

INSULATION TO PROTECT FROM NOISE OF AIRPLANES (claim 14)

Item 14 of the Decision refers to a claim by the Applicant’s that “the insulation is supposed to be very high quality because of the airport location & noise of the airplane but it is not because we can hear the noises as we are outside the house.”

The Applicant’s testimony did not mention any inadequacy in the insulation but instead focused on a complaint that the windows in the home did not meet the specifications for windows set out in a document prepared by J.L. Richards & Associates Limited and included as part of a larger document described as “Prescribed Measures to Address Aircraft Noise 25 NEF/NEF to Ottawa Airport Operating Influence Zone OAOIZ Joint Committee”. The Applicant’s conclusion that his windows fell below the standards set out in the J. L. Richards report were inadequate was based on a statement of room sizes provided by the Builder and information supplied by the window manufacturer relating to the thickness of window panes and spaces between window panes. .

Mr. Stinson testified that on his first inspection the Applicant directed him to a location in the basement where the insulation was visible. He found no defect in the insulation. He stated that he at no time prior to the commencement of these proceedings received a complaint concerning the quality of the windows.

Mr. Bouchard stated on behalf of the Builder that a Noise Compliance Review of the drawings for this model home by David NcManus Engineering concludes that all the building components in this model meet or exceed the prescribed measures required for the 30 NEF/NEP contour forming part of the Prescribed Measures to Address Aircraft Noises, Residential Development. The Builder also testified that the Applicant declined its recent offer to have a proper noise evaluation carried out and to make whatever changes might be called for.

THE LOCATION OF THE AIR CONDITIONER (claim 22)

The essence of the Applicant’s claim in this regard is that the exterior air conditioning unit was placed within 1 inch of the side fence at the rear of the home. As the fence is on the property line, the placement of the air conditioner fails to meet the requirements of a City of Ottawa by-law requiring a minimum distance of 0.3 meters or approximately 12 inches between the air conditioner and the property line. The placement also prevents the Applicant from walking into his rear yard along the left side of his house.

Tarion’s Warranty Service Representative estimated the distance between the side of the air conditioner and the property line as approximately six inches.

Luc Bouchard testified on behalf of the Builder that the air conditioner was located where it was on the left side of the house so as to be in close proximity to the furnace. A move to the right side of the house could be made but would result in a less efficient cooling system.

CONSTRUCTION DEBRIS IN AIR DUCTS (item 46)

The Applicant’s claim is that wood and other construction debris was left in the furnace air ducts at the end of construction. A photograph taken by the Applicant during the course of construction shows the presence of wood chips in an opening in an air duct. It was the Applicant’s opinion that ducts should not contain openings during construction and that a single cleaning was not sufficient to remove all debris at the conclusion of construction.

Mr. Bouchard gave evidence that the Builder cleaned the ducts on October 06, 2011 following completion of construction and approximately three weeks prior to the Applicants taking possession. The Applicants subsequently installed hardwood flooring which may have caused additional debris in the ducts. He also testified that the Builder covered duct openings with screening during the course of construction as is common practice in the industry.

FAULTY BATHROOM FAUCET (claim 93)

Within 30 days of taking possession, the Applicant advised that “All faucets need to be adjusted space between the faucet and the base.” His evidence at the hearing was that the Builder’s plumber subsequently attended and adjusted the gap between the faucet and the base of all faucets except for the faucets on the bathtub in the master en suite, which he declined to adjust due to the difficulty in gaining access through the tile surrounding the tub. When the Builder would not correct this problem the Applicant testified that he went to the faucet manufacturer’s web site, sent the manufacturer a photograph showing a 5 mm gap between the faucet stem and the base and enquired whether such a gap was proper. He was advised that there should be no gap in the location shown in his photograph. The Applicant said that the gap still exists and that the stem is loose and bent

At the Hearing, Tarion’s Warranty Service Representative advised that he had not noticed any unusual gap at the faucet base and that there was no impairment of functionality.

Mr. Bouchard testified that the plumber denied that there was any problem with the faucet and that if there were the faucet could be adjusted without removing the tile surrounding the tub.

APPLICATION OF LAW TO FACTS

The Ontario New Home Warranty Plan Act provides consumer protection for new home purchasers within the Province. As consumer protection legislation the Tribunal is to give this legislation that broad and liberal interpretation that will best achieve its goals. In doing this, the Tribunal must also be careful not to exceed its jurisdiction by granting remedies to homeowners that go beyond the remedies provided by the Act. As has been stated in many decisions of this Tribunal, including the recent decision by Vice-Chair Weary in 2957-ONHWPA (2007) O.L.A.T.D., the Act does not grant the Tribunal jurisdiction to rule on all disputes which may arise between a builder and a homeowner under their Agreement of Purchase and Sale, but only to ensure that the homeowners receive the benefit of the warranties which are set out in the Act.

The Tribunal’s findings with respect to each claim are as follows:

The columns

The APS signed by the Applicants included Form IV 37790 with its attached plan clearly showing that the round columns supporting the rear decks had been changed to square.There was accordingly no breach of the APS. No evidence was lead to suggest that the square columns provided any less support than the original choice of round columns or failed to meet any requirements of the OBC. Rather, the only complaint other than an alleged breach of the APS related to the appearance of the columns. Appearnaces are not included in the warranty provided by section 13 of the Act.

The basement height

The only mention of the height of the basement ceiling in the APS refers to “foundation walls (8’-10’’ high around basement)”. The Tribunal finds that the foundation walls were within ½ inch of this height. Although there was possibly an extremely minor deviation from the specifications in the APS in this respect, there was no evidence of poor quality workmanship or material or breach of the OBC. The Tribunal accordingly finds this item not warranted.

With respect to the Applicant’s claim that the height between the stairs and the overhead beam does not meet the minimum distance set out in the OBC, the Tribunal accepts the measurements made by Tarion’s Warranty Service Representative in preference to the measurements set out in a report filed by the Applicant. Tarion’s representative has extensive knowledge of the OBC requirements regarding how measurements must be taken, has training in the OBC, much experience and was available for cross-examination. In contrast, the credentials of the author of the report filed by the Applicant are unknown as was the method he used to take his measurements. The Tribunal accordingly accepts his measurements and finds that the Applicant has failed to meet the onus resting on him of showing that there was a breach of the warranty in section 13 1 (a) (iii) of the Act .

Insulation

The Tribunal finds that there was no defect in the workmanship or material relating to the insulation and certainly no departure from the requirements of the OBC. With respect to the alleged failure of the windows to meet the requirements of a noise abatement policy incorporated in the APS (cf. the last clause in Sch.3 of the APS) the Tribunal finds that this is a contractual issue between the Builder and the Applicant falling outside the jurisdiction of the Tribunal.. The Tribunal also accepts the submission by Tarion’s counsel that this Tribunal lacks jurisdiction to rule on this matter as the issue of window thickness was never brought to Tarion’s attention for conciliation or decision.

Air Conditioner

There is no issue or evidence relating to the quality or the material or workmanship relating to this item or any alleged departure from the requirements of the OBC and thus no breach of warranty under section 13 of the Act. If, as alleged, the placement of the air conditioner is in violation of a municipal zoning by-law the Applicant may wish to consider recourse available to him outside this Tribunal.

Air Ducts

The evidence by the Builder that the air ducts were protected during the course of construction and cleaned shortly at the end of its work shortly before the Applicant’s taking possession was not seriously disputed. No evidence was adduced to indicate that this practice was a departure from normal accepted practices or a violation of any warranty under the Act.

Bathroom faucet

Neither Tarion nor the Builder seriously disputed the Applicants’ claim that the manufacturer of the faucet in question advised the Applicant that a gap shown in a photograph of the faucet the Applicant sent him indicated improper installation. Nor did they dispute the Applicant’s evidence that the Builder’s plumber returned to the house at the Applicant’s request and adjusted all other faucets in the house showing such a gap. Tarion’s representative had no knowledge of the condition of the faucet as he had not been directed to it on his last visit and the Builder’s only evidence was that its plumber advised him that there was no problem with the faucet.

In her closing submissions, counsel for Tarion referred to a number of decisions of this Tribunal which either applied the doctrine of “de minimus non curat lex” (the law does not concern itself with trifling matters) to dismiss such minor imperfections or criticised the use of close-up photographs to detect such defects. While not doubting that such findings may be called for in appropriate cases, this Tribunal finds that such cases are distinguishable from the case before it on the basis that these cases were dealing with alleged imperfections in appearances only while in this case there is direct evidence indicating that the gap, small though it might be, would affect the performance of the faucet. The Tribunal accordingly finds that the Applicant has satisfied the onus on him of proving that claim 93 fails within the warranty requiring builders to use good workmanship and materials.

ORDER

Pursuant to the authority vested in it under the provisions of the Act, the Tribunal directs Tarion to disallow the Applicant’s claims for warranty coverage with respect to all items other than claim 93 (Bathroom faucet).

LICENCE APPEAL TRIBUNAL

Douglas R. Wallace, Vice-Chair

Released: January 08, 2014