8873 v. Tarion Warranty Corporation, 2014 CanLII 79666

Licence Tribunal

Appeal d'appel en Tribunal matière de permis

DATE: 2014-11-28

FILE: 8873/ONHWPA

CASE NAME: 8873 v. Tarion Warranty Corporation

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

The Appellant Appellant

-and-

Tarion Warranty Corporation Respondent

-and-

Springbrook Estates Inc. Added Party

REASONS FOR DECISION AND ORDER

ADJUDICATOR: D. Gregory Flude, Vice-Chair

APPEARANCES:

For the Appellant: Self-represented

For the Respondent: Gena Argitis, Counsel

For the Added Party: Mike Muto, Agent

Heard in Toronto: November 14, 2014

DECISION

1Pursuant to the Ontario New Home Warranties Plan Act, R. S. O. 1990, c. O.31 (the “Act”), the Appellant appeals the decision of Tarion Warranty Corporation (“Tarion”) to deny the claim for warranty set out in a Decision Letter dated May 14, 2014. The Added Party, Springbrook Estates Inc., is the vendor of the home and is liable to either effect warranty repairs or to reimburse Tarion for the cost of those repairs in the event this Tribunal finds in favour of the Appellant. The Added Party supports Tarion’s position in this matter.

2The only issue raised in the Decision Letter, and the basis for the denial of coverage, is Tarion’s position that the Appellant did not make a claim for a conciliation inspection within the requisite window set out in O/Reg 892, that is, in the 30 day period ending 150 days after he filed his year-end warranty claim form. The Appellant argues that he had notified Tarion of his concerns with defects in the home and that Tarion did not respond. He also argues that Tarion failed to point out in any of its communications that limitations on the warranty, the times in which warranty claims must be made, and that the consequences of failing to claim in a timely manner were statutory provisions. He argues that, prior to receiving the Decision Letter, he had never heard of O/Reg 892. For the reasons that follow, the Tribunal can find no merit in the grounds of appeal advanced by the Appellant.

3The facts of the matter become clearer if they are approached chronologically. The Appellant’s home was completed for possession on May 31, 2012. In and around the time of possession, the Appellant conducted a pre-delivery inspection (PDI) with the Added Party’s representative. While the Appellant takes issue with the fact that the PDI was controlled by the Added Party and that the Added Party decided what items were included in the PDI form, other than general dissatisfaction with the system, nothing turns on defects identified on the PDI form.

4As part of the closing documentation, the Appellant was given a Homeowner information Package (HIP). The HIP sets out in great detail the statutory warranty scheme and the consequences of failure to make a claim for a conciliation inspection in a timely manner. It states clearly on page 1 that the scheme is governed by the Act. It states:

4. After you submit a Statutory Warranty Form, your builder has a specific period of time in which to repair or otherwise resolve the warranted items listed. If these items are not resolved within the appropriate time period (see page 18 for details about the Initial Builder Repair Period), then you have 30 days to contact Tarion to request a conciliation inspection. If you do not contact us within 30 days, we will not be able to help resolve the situation, unless it is an emergency.

Page 18 states:

The Initial Builder Repair Period

Submission of a 30-Day, Year-End and/or Second-Year Form triggers the builder’s initial 120-day repair period as follows:

• The builder repair period for the 30-Day Form begins 31 days following the date of possession. If, for example, your home’s date of possession is November 8, 2012, the builder repair period for warranted items listed on your 30-Day Form would begin on December 9, 2012.

• The builder repair period for the Year-End Form begins on the anniversary of the date of possession. So, for example, if your home’s date of possession is November 8, 2012, the builder repair period for warranted items listed on your Year-End Form would begin on November 8, 2013.

• ​The builder repair period for warranted items listed on your Second-Year Form begins on the day after Tarion receives the Form.

During the period it is important that you provide your builder and their tradespeople access to your home.

Your Time Period to Request Tarion’s Involvement

If your builder does not complete or otherwise resolve items that you believe are warranted by the end of the 120-day period, you will have 30 days to request a Tarion conciliation inspection. You can book an inspection online through your MyHome account, or by contacting us. You must provide a deposit of $282.50 ($250 + HST), which will be refunded to you if we determine that one or more items we inspect are covered by warranty. To encourage resolution of disputes, we have introduced a $1,000.00 charge for builders when we conduct a conciliation and determine that one or more items are warranted.

If you do not request a conciliation during this time, Tarion will consider all of the items listed on your Statutory Warranty Form to have been withdrawn. [emphasis added]

5The statutory warranty scheme allowed the Appellant to file a warranty claim within the first 30 days of possession. He did so and Tarion acknowledged its receipt by letter dated July 4, 2012, and advised him of the following:

Thank you for submitting a 30-Day Form. We are accepting this form based on the Date of Possession of record for your home, May 31, 2012.

What Happens Next

Your builder should resolve the items that are covered by the warranty by October 29, 2012…

If Your Items Are Not Resolved

If your items are not resolved by the above date, you must contact us between October 30, 2012 and November 28, 2012 to request a Tarion inspection of your home to assess the situation. If you do not request and inspection during this time period, Tarion will consider all items listed on your form to have been withdrawn and will not be able to resolve the situation. [emphasis added]

6Prior to October 30, 2012, the Appellant dealt with the Added Party to address his concerns. He remained dissatisfied with some issues and wrote to the Added Party on September 3, 2012, expressing his concerns. He copied that letter to Tarion with the words; “Ladies/Gentlemen, Please take necessary action and advise.” He received no response from Tarion. Tarion acknowledges receipt of the letter. It receives many such letters from both homeowners and builders outside the request period for an inspection and treats them as informational. It filed the letter.

7On October 22, 2012, during the conciliation period set out in the July 2012 letter from Tarion, the Appellant copied Tarion on a letter to the City of Brampton raising grading issues. There is no evidence that Tarion received this letter. Even if it did, the letter does not request Tarion to conduct a conciliation inspection or to take any other action. The Appellant argues that these two letters constitute notice to Tarion of his dissatisfaction with the remedial work carried out by the Added Party. He further argues that Tarion’s lack of response indicates its lack of willingness to assist him and that, as a result, he became discouraged. In his view, this excuses him from making his request for a conciliation inspection outside of the requisite time.

8On May 30, 2013, the Appellant filed a Year-End Form. Tarion acknowledged receipt of this form by letter dated June 3, 2013, substantially in the same terms as the letter from the previous July quoted above. It advised the Appellant that the builder repair period would end on September 30, 2013, and the time period for requesting a conciliation inspection would be between October 1 and October 30, 2013. It also advised: “If you do not request and inspection during this time period, Tarion will consider all items listed on your form to have been withdrawn.” On December 9, 2013, Tarion received a letter dated December 5, 2013, from the Appellant requesting a conciliation inspection.

9Tarion did not respond to the letter dated December 5 until contacted by the Appellant. It had been misfiled. When it did, it denied the claim on the basis that no request for a conciliation inspection had been made in a timely manner. It quoted ss 4.3 (8) to (10) of O/Reg 892:

(8) Subject to subsection (9) and section 5.1, if a home has a date of possession on or after September 1, 2005 and if an owner submits a year-end form to the Corporation with respect to the home during the year-end claim period, the vendor shall have until the end of the 150th day after the first anniversary of the date of possession to repair or resolve the claim items that are listed on the form and that are covered by a warranty.

(9) If the vendor does not repair or resolve all of the claim items listed on the year-end form mentioned in subsection (7) by the end of the 120th day after the first anniversary of the date of possession, the owner may request a conciliation by contacting the Corporation at any time from the 121st day to the 150th day, both inclusive, after the first anniversary of the date of possession.

(10) If the owner does not request conciliation under subsection (9) or if the owner cancels the conciliation requested under that subsection, the owner shall be deemed to have withdrawn all claim items listed on the year-end form that the vendor does not repair or resolve by the end of the 150th day after the first anniversary of the date of possession.

10It is true that nothing in the HIP or the two letters acknowledging receipt of claims forms refers to O/Reg 892. What is also true is that the language in two locations in the HIP and in the two letters closely mirrors the wording of the regulation. It sets out clearly the timetable for making a request for a conciliation inspection and the consequences of failing to make that request in a timely manner. The Appellant acknowledges receipt of the requisite documents. He acknowledges having read the documents. He advances no explanation for not following the statutory claim timetable other than he was unaware that it was set out in regulations. In essence, he asserts that, had he known it was part of the statutory scheme, he would have taken it more seriously. It is his belief that the time limits would be less binding if they were merely contractual. As stated above, the Tribunal finds no merit in this submission.

11With respect to the two letters sent in September 2012, neither was addressed to Tarion and the second one was likely not received. The Appellant is unsure if he ever sent the copy to Tarion and Tarion has no record of having received it. Both letters relate to the 30-day Form. It is a stretch to assert that a letter written with respect to an earlier claim is notice requesting an inspection for a claim that has not yet been made. In any event, neither letter requests a conciliation inspection. They address lot grading issues which, with limited exceptions, are not within the statutory warranty scheme. It is arguable that they may give Tarion notice of a potential future dispute but the Added Party had approximately six weeks to carry out repairs. The Appellant’s failure to request conciliation at the end of the builder repair period is a representation to Tarion that the Added Party had completed any outstanding warranty issues to the satisfaction of the Appellant. Tarion was more than justified in closing its file on the 30 day issues. Thereafter, the Appellant did not contact Tarion regarding warranty issues until the expiry of the year-end conciliation period.

12Tarion pointed out to the Tribunal that there is a provision in O/Reg 892 that allows for the extension or truncation of the regulatory time limits. It concedes that the Act permits the Tribunal to order Tarion to perform any action that it is authorised to perform under the Act and regulations, including exercising its discretion under s. 5.10. S. 5.10 states:

5.10 The Corporation may, in its sole discretion, extend or abridge any time specified in sections 4.1 to 4.6, 5.1, 5.2, 5.5 to 5.7 and 5.9 if it determines that,

(a) the vendor is unable or unwilling to repair or resolve the claim items covered by a warranty;

(b) the warranty claim,

(i) relates to items involving health and safety, seasonal repairs or an emergency, or

(ii) involves other extraordinary circumstances; or

(c) the specified times begin in, end in or span the period from December 24 of one year to January 1 of the following year, both inclusive.

13In reviewing this section, Tarion pointed out that no evidence had been advanced to bring the Appellant’s actions within its terms. The Added Party worked with the Appellant and was always able and willing to carry out warranty repairs. The issues did not address health and safety or emergency repairs that required an immediate response from the Added Party or involvement of Tarion at a time earlier than the claim timetable. From the correspondence, it is clear that the Appellant and Added Party addressed issues relating to grading of the lot during the summer and fall such that the seasonal repair exception was not triggered, nor was the winter holiday period exception applicable. Finally, there is no evidence of extraordinary circumstances. The Tribunal agrees with Tarion’s analysis. It can find no grounds for ordering Tarion to exercise its discretion under s. 5.10.

ORDER

14By virtue of the authority vested in it by the Act, the Tribunal orders Tarion to deny the Appellant’s claims for warranty.