7889 v. Tarion Warranty Corporation, 2014 CanLII 86266

Licence Tribunal

Appeal d'appel en

Tribunal matière de permis

DATE:

2014-11-19

FILE:

7889/ONHWPA

CASE NAME:

7889 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-

Novarese Properties Ltd.

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:

Sam Allegranza, Agent

Heard in Toronto:

August 25, September 15 and October 23, 2014

DECISION

1The Appellant appeals the decision of Tarion Warranty Corporation (“Tarion”) to deny a claim for warranty set out in a Decision Letter dated January 22, 2013. There are two items in dispute: bowing of the brick cladding on exterior walls and incorrect replacement of defective mortar previously warranted by Tarion. Under the second head, the Appellant not only claims that the warranty repairs are insufficient and that all of the mortar needs to be replaced, but that the repairs so far have been defective and have caused damage to a number of bricks.

2The Appellants’ right to warranty coverage is set out in s. 13 of the Ontario New Home Warranties Plan Act, R. S. O. 1990, c. O.31 (the “Act”):

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.

3With respect to the statutory warranties set out above, there was no evidence to suggest that the home was not fit for habitation. Further, there was no evidence of a breach of the Ontario Building Code (OBC). Accordingly, the focus of the hearing addressed the question whether the home was constructed in a workmanlike manner and was free from defects in material.

4The Appellant testified on her own behalf; Karin Gaupholm, a Senior Warranty Services Representative at Tarion Warranty Corporation testified on behalf of Tarion; and Sam Allegranza testified on behalf of the Added Party. There was consensus that there was bowing in the brick cladding, the argument concerning the bowing focussed on its magnitude and whether it was noticeable and warrantable. There was also consensus over the fact that there was a defect in the mortar. Tarion and the Added Party assert that the mortar was defective only in specific spots. The Appellant takes the position that the mortar was defective throughout the brick cladding and it all needed to be removed and replaced. There were also issues concerning the qualifications of the persons assigned to carry out the warranty repairs and alleged damage to a number of bricks arising out of the repair methods.

5The Appellant testified that when she put in an offer to purchase the home, she did not notice any particular defects. Prior to closing, she conducted an inspection and noted that there was bowing or bulges of the wall in numerous locations, but most noticeable at the rear of the east wall. She made a claim under the warranty and the Added Party carried out some repairs. When the Tarion representative attended to carry out the conciliation inspection on November 30, 2012, she denied the warranty claim under this item as follows:

Tarion reviewed the item as identified by the homeowner. The builder confirmed that they had completed repairs to this item previously. When viewed from a normal standing position under normal lighting conditions at a distance of 6m, the brick veneer cladding has a generally uniform appearance. There is no defect in workmanship that amounts to a breach of the One Year Workmanship Warranty.

6Following a Pre-Hearing Conference before this Tribunal on June 24, 2013, the Parties agreed and the Tribunal issued an order that the Added Party would hire a professional engineer to conduct an inspection of the exterior brick walls and develop a scope of work for repairs. With respect to the bowing of the walls, the Order provides that the professional engineer would review the issue “to determine whether a resolution of that issue could be reached. What actually transpired at the engineer’s inspection became the source of some acrimony between the Parties at the time that led to Ms Gaupholm, the Tarion representative in attendance, to cancel the balance of the inspection.

7Mr. Allegranza testified that he attended at the inspection on behalf of the Added Party. He brought a straight edge with him to measure displacement of the wall. When the engineer had completed his inspection of the mortar, including climbing a ladder to inspect the mortar some feet above the ground, Mr. Allegranza climbed the ladder with the straight edge in an area that he had been pointed out to him. He put the straight edge against the wall and measured a displacement of approximately one half to five-eighths of an inch. The Appellant and her expert took issue with the measurements and, as Mr. Allegranza reached further and further from the ladder to satisfy them, Ms Gaupholm developed some concern for Mr. Allegranza’s safety and cancelled the rest of the inspection.

8The Appellant takes the position that the Tribunal’s order required only the engineer to climb the ladder and measure the deviation in the wall. The Tribunal does not read the order as being either so specific or so limited. It requires the engineer to review the wall bowing to determine whether there was the possibility of a resolution. It matters not, in that context, that Mr. Allegranza took measurements in the presence of the engineer, or the engineer did them personally. It became clear from the acrimony of the situation that there would be no resolution. The only evidence of this problem before the Tribunal is Mr. Allegranza’s measurements: the walls bow approximately 12 mm to 15 mm.

9There is no specific provision in the OBC about bowing or bulging walls. It was suggested that an analogy might be drawn from the standard applicable to corbelling. Corbelling is the action of deliberately offsetting masonry to create a pattern or a cornice. The standard applicable in that case is one third of the thickness of the brick, or 30 mm in the case of the Appellant`s home. The Tribunal can take from this standard that a brick displace by 15 mm from the wall plane does not represent a risk of imminent failure. The issue for the Tribunal is to determine if such displacement is “workmanlike.” In applying that standard to the current facts, the Tribunal runs squarely into an issue that is at the heart of many warranty appeals to this Tribunal – acceptability of workmanship versus perfection. Numerous decisions of this Tribunal have concluded that the standard is not perfection.

10In her evidence, Ms Gaupholm stated that until the bowing of the wall was pointed out to her and she stood in a very specific location, she could not see it. She stated that the standard that Tarion applies to such issues is set out in the Construction Performance Guidelines (CPG), a publication produced by Tarion to inform the public and the building trades about the acceptable level of workmanship in new home construction. She also said several times that the standard is not perfection. She outlined the difficulties, in this particular case, that the bowing wall is between two houses and to view it face on from 6 m, the standard viewing distance, is not possible. She needed to look at it obliquely. She agreed with the comments of the original representative regarding the initial inspection that the brick cladding is generally uniform in nature and bowing would not be apparent to the average person. In response to questions from the Appellant about the fact that a representative of the brick manufacturer noticed the bowed areas, she replied that the areas had been specifically pointed out to him, and, in any event, he is not an average person when it comes to brick.

11The CPG are neither statute nor regulation, thus they are not binding on the Tribunal. What they do represent is a reasoned approach to the settlement of disputes before such disputes result, initially, in a conciliation inspection, or later, in an appeal to this Tribunal. So long as application of the CPG is infused with common sense and they are not being applied mechanistically, they represent a good starting point for this Tribunal to determine what workmanship is acceptable. With respect to the bowing of the wall, the Tribunal accepts the evidence of Ms Gaupholm that, while the bowing is visible on close inspection from specific viewpoints, it is not readily visible and therefore does not constitute a defect in workmanship.

12The second area of dispute between the parties is the mortar. The dispute revolved around the scope of the Appellant’s claim, and as a direct result of that dispute, the scope of the necessary repairs. It is the Appellant’s position that the mortar throughout the house is defective and requires replacement. It is Tarion’s position that there were defects in the mortar, which were warranted, but the repairs carried out by the Added Party have remedied those defects. Arising out of the repairs done so far, the Appellant asserts that the new mortar does not match the old and the repairmen were unqualified and damaged the brick while carrying out the repairs.

13All parties relied on expert reports. The Appellant retained the services of Paul Jeffs of PJ Materials Consultants Limited, and Tarion and the Added Party relied on a report by CCI Group Inc. and, in particular, consulting engineer, Janan Sulaiman. Neither expert was called as a witness.

14Each expert provided a curriculum vitae. Mr. Jeffs has a background in restoration of historical buildings but would appear to have no formal engineering qualifications. Dr. Sulaiman has a Ph.D. in Engineering and has had approximately 40 years of experience. Both experts agree that there is defective mortar. Both experts agree that the appropriate repair is to grind out the defective mortar to a specific depth and repoint. There is a difference of opinion with respect to the qualification of the repairers. There is also a difference of opinion about how much of the mortar needs to be replaced.

15The Jeff’s report has photographs of measurements being taken to determine mortar strength. The Tribunal notes that all of these measurements were taken less than five feet above grade. He concludes that:

Based on visual inspections of the mortar accessible from grade level, the author considers it highly likely that the results achieved for randomly selected locations would be typical for the entire area of masonry.

16The Appellant, Ms Gaupholm and Mr. Allegranza were present when Mr. Sulaiman conducted his inspection. The evidence disclosed that Dr. Sulaiman checked the mortar to see if it crumbled easily by running a screwdriver over the surface and pushing the screwdriver into the mortar. He did this in those areas indicated by the Appellant on the west wall. He also climbed a ladder and tested well above grade. He concluded that the problem was limited to the bottom five feet on the west wall and developed a repair scheme for the condition he found. The dispute between the Parties arises out of the different conclusions regarding the scope of the repair.

17Both Mr. Allegranza and Ms Gaupholm gave evidence of normal bricklaying practice in the new home construction industry. The Appellant’s home was clad with brick in the winter. The practice is to cover the work area with plastic and heat the wall. Since heat rises, there may be local areas on the lower five feet of the wall where the temperature may drop below freezing preventing the mortar from curing properly. This results in soft and flaky mortar. This explanation is consistent with the findings of both experts. The witnesses went on to explain that the mortar above five feet remains warm and cures properly. Hence it does not need to be replaced. Considering all of the evidence, the Tribunal finds that the evidence of Ms Gaupholm and Mr. Allegranza and the report of Dr. Sulaiman best describe the defective condition and the appropriate scope of repairs.

18There was an issue over the qualifications of the repairers. Mr. Jeffs stated in a May 14, 2013 letter that he believed bricklayers would have little experience in repointing and that the work should be undertaken by a specialist masonry restoration company. Mr. Allegranza maintained under extensive cross-examination by the Appellant, that the skill set required by a bricklayer included repointing and that new home bricklayers often need to repoint masonry. This position meshes exactly with the evidence that localized freezing of mortar is not a rare occurrence and needs to be repaired. Notwithstanding this, the argument misses the point. The Appellant is entitled to have the defective condition remedied, not to dictate who effects the remedy. The warranty is and always remains the responsibility of the Added Party and it is up to the Added Party, and in default thereof, Tarion, to decide on the scope of repairs and the personnel who carry out the repairs. The Appellant may raise defective repairs before this Tribunal, but subject to two issues addressed below, she has produced no evidence that the repointing is defective.

19The Appellant did raise two issues: bricks were damaged during the repair period and the colour of the replacement mortar does not match the original in certain areas. She produced a number of pictures of chipped bricks in the repaired areas directly in line with vertical joints and consistent with damage from a rotary grouter remover. While there was a dispute concerning the measurement of the size of the damaged areas, the Tribunal is satisfied that the only logical explanation for the damage is that it occurred while the defective mortar was being removed and is of sufficient size to warrant repair. The damage is shown in Exhibit 6, Tab 6 in photos 1 – 7 and 10 – 13. Despite a statement in an email made by counsel for Tarion that the repair would involve removal and replacement of damaged brick, the Tribunal accepts the evidence of Ms Gaupholm and Mr. Allegranza that the appropriate repair is to stain the damaged areas.

20Concerning the claim about mismatched mortar, the photographs showing an area of mismatched grout are of the rear wall of the property. Ms Gaupholm did conduct an inspection of the other areas of repaired grout and testified that she found it to be acceptable. Due to miscommunication, she did not realize that the gate to the rear garden had been left unlocked. She did not inspect this area. The photographs make it clear that they were taken in the growing season, that is, several months after repairs were carried out, and the mismatched mortar is still obvious. The Tribunal is satisfied that the specific area does not simply reflect that the mortar in that area is wet. Accordingly, the Tribunal concludes that the repair in this area is defective as the mortar does not match. The normal repair method is tinting the replacement mortar to match the surrounding area. The Tribunal finds that this is the applicable and acceptable repair for this condition.

ORDER

21By virtue of the authority vested in it by the Act, the Tribunal orders Tarion to:

1. Tint the damaged areas in the bricks identified in photos 1 – 7 and 10 – 13,

2. Tint the area of mismatching mortar on the rear wall shown in Ex 6, Tab 6 photos 16 – 22, and

3. Deny the balance of the Appellant’s claims for warranty.