Licence Tribunal
Appeal d'appel en
Tribunal matière de permis
DATE:
2016-04-27
FILE:
9946/ONHWPA
CASE NAME:
9946 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
Appellants
Appellants
-and-
Tarion Warranty Corporation
Respondent
-and-
Valley Lands Homes Limited
Added Party
REASONS FOR DECISION AND ORDER
ADJUDICATOR:
Mary Ann Spencer, Member
APPEARANCES:
For the Appellants:
Self-represented
For the Respondent:
Luke Johnston, Counsel
For the Added Party:
Patrick Essig, Counsel
Heard in Toronto:
April 18, 2016
REASONS FOR DECISION AND ORDER
This is an appeal by the Appellants to the Licence Appeal Tribunal (the “Tribunal”) from a Decision Letter of Tarion Warranty Corporation (“Tarion”) dated November 23, 2015, in which Tarion denied the Appellants’ claim with respect to a new home purchased from Valley Lands Homes Limited (the “Added Party”).
The item under appeal, as described by the Appellants is:
Interior – Floor 01 – Great/Grand/Family Room – Window not positioned properly. Positioned to left side too close to wall. Having issues hanging the drapery also looks awkward.
A window is positioned on either side of the fireplace on the rear wall of the family room of the Appellants’ home. The parties agree that the windows are not symmetrically spaced. The window on the west side of the fireplace is centred on the wall, with approximately 4” space on either side. The window on the east side is not centred on the wall; there is 1” space on the east or kitchen side and 7” space on the west or fireplace side. The issue to be addressed in this hearing is whether or not the positioning of the east window is a warrantable defect under the Ontario New Home Warranties Plan Act (the “Act”).
FACTS AND EVIDENCE
The Appellants in this case are husband and wife. The husband testified on their behalf and will be referred to as Appellant S in this decision.
Appellant S referred to pictures of the windows contained at Tab 7 of the book of documents provided by Tarion (Exhibit 3). He testified that the window on the east side of the family room fireplace has been installed in the wrong place. Its placement does not represent a minor variance; it is located 7” from the fireplace rather than 4” and therefore is “off by 75%”, a significant variance that cannot be ignored.
When asked what problems the variance was causing, Appellant S stated that it was causing stress. The Appellants cannot place a drapery rod or hang drapes properly because of the placement of the window. And, because the variance is highly noticeable, the resale value of their home will be reduced.
Appellant S has no training in construction and does not work in the building industry. He is not disputing the measurements taken by Tarion; his complaint is with how the window looks, not with how it functions. He agreed the window is square and there are no issues with the materials used to construct it. Its placement is the issue; this is a defect in workmanship. He does not know if the window represents a breach of the Ontario Building Code; he only knows that it has not been installed the way the architect designed it.
Appellant S emphasized that he is not seeking money; he wants the window to be repositioned. Asked if moving the window three inches would not result in uneven positioning on the outside of the home, he agreed it would but added that the family room window would not be off by 3” because the basement window immediately below the family room window would also be moved. Referred to the $35,000 quote he obtained with respect to the cost to move both the basement and the family room windows (Exhibit 6), he acknowledged that the estimate was neither signed nor dated and did not provide details with respect to the scope of the work to be performed.
Mr. Essig asked Appellant S if he had received floor plans when he purchased the home. Appellant S agreed that he had. Referred to the “Ground Floor Elevation ‘A’ Modified” plan at Tab 2 in the Added Party’s book of documents (Exhibit 4), the Appellant acknowledged that it contains the following disclaimer:
The floorplans and elevations shown, dimensions, specifications and architectural detailing are pre-construction plans and may be revised or improved as necessitated by architectural controls and the construction process. All dimensions are approximate. Actual usable floor space may vary from the stated area. House may be reversed and purchaser agrees to accept same. Specifications subject to change without notice. Steps may vary at any exterior entrance. Illustrations are Artist’s concept. Exterior railings on plans only as required by grade. E. & O.E. February 2012.
Appellant S also acknowledged that the plan had been initialled by him and by his wife, but stated this was only with respect to upgrades.
Thomas Hollmann testified on behalf of Tarion, where he has been a Warranty Service Representative for over 8 years. Mr. Hollmann, whose educational background is in architectural technology, previously worked in the construction industry. He conducts inspections and is responsible for assessing claims for their warrantability under the Act. He estimated he has conducted over 1,000 such inspections.
On November 11, 2015, Mr. Hollmann conducted a conciliation inspection at the Appellants’ home with respect to items submitted on the Appellants’ 30 Day Form. The Appellants and two representatives of the Added Party were in attendance.
Mr. Hollmann testified that he measured the distance between the windows and the fireplace on the rear wall of the family room of the Appellants’ home. The east window is 1” from the wall on the kitchen side and 7” from the fireplace; the west window has 4” space on both sides. Mr. Hollmann noted that when drapes are placed in the middle of the windows, as they are in the pictures in Tarion’s exhibit book, that the differences between the windows’ spacing is visible. In his experience, however, drapes are normally fully drawn or hang at the side of the window casing. He also noted that there is insufficient room for the finial on the drapery rod on the east side of the east window.
Mr. Hollmann further testified that on the exterior of the home, the family room windows are equidistant from the fireplace. Mr. Hollmann did not measure the difference but testified that on either side, there is one course of brick between the window frame and fireplace.
Mr. Hollmann assessed no defects in the materials or workmanship of the east window and stated that the interior spacing differential has no impact on its service life. He characterized the variance as minor and as an aesthetic issue. Asked how common this type of spacing irregularity is, Mr. Hollmann stated “it definitely comes up”. Mr. Hollmann reviewed the home plans and noted that the dimensions are on the exterior side of the home. Asked if the builder followed the plans, Mr. Hollmann stated “yes, that’s my conclusion”.
With respect to repairing the window, Mr. Hollmann noted that it would require the removal of trim, the window itself and the lintel. Masonry would be cut, insulation would be removed and the vapour barrier would be cut. He noted that it might be difficult to find matching bricks, particularly given the existing bricks will have changed with outdoor exposure. Studs might require adjustment. Interior walls would have to be repaired and repainted. In his opinion, such a repair is major and if not done well, poses risks, particularly for leakage. Tarion did obtain a detailed quote from Unlimited Building Solutions which is a vetted contractor on Tarion’s preferred contractor list. The quote is for $20,610.82, excluding both the cost of permits, estimated not to exceed $1,000, and additional costs that might arise due to unforeseen conditions.
Elio Cancian testified on behalf of the Added Party. Mr. Cancian is president of Cancian Construction, a company which frames approximately 2,000 homes each year. Mr Cancian’s company framed the Appellants’ home.
Mr. Cancian testified that outside walls are framed first and explained that the work starts at the basement. Those lower windows would be positioned equidistant on either side of the fireplace. The upper storey windows would be positioned in line with the windows below. Asked if variations in interior spacing can occur, Mr. Cancian stated that it can and noted that every house is slightly different. Sometimes, it may be necessary to increase the width of partition walls between a kitchen and an adjacent room to enclose plumbing, for example. This would not be done on the kitchen side where it is important to ensure measurements stay true because of plumbing and cabinetry. Mr. Cancian does not know whether the partition walls were increased in size at the Appellants’ home.
Asked if measurements are checked when the bottom windows are framed, Mr. Cancian stated that both his company’s foreman and the builder’s supervisor perform these checks. Records of the checks are not kept and reports would only be filed if a problem was discovered.
THE LAW
The applicable provisions of the Act are as follows:
Warranties
- (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.
Breach of Warranty:
- (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,
(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).
(4) Subject to the regulations, an owner who suffers damage because of a major structural defect mentioned in clause 13 (1) (b) is entitled to receive payment out of the guarantee fund for the cost of the remedial work required to correct the major structural defect if the owner makes a claim within four years after the warranty expires or such longer time under such conditions as are prescribed.
Section 6 of R.R.O. 1990, Regulation 892 sets out the limits of liability under the Act. In this respect, it states:
- (6) Liability under subsection (3) or (4) is limited to damage to the home only and liability under subsection (5) is limited to damage to the common elements only and there is no liability for any other damage, direct or indirect.
APPLICATION OF LAW TO FACTS
In his closing statement, Appellant S submitted that the placement of the east window on the rear wall of his home’s family room is a defect in workmanship. The interior measurements confirm its placement is incorrect. There has been no explanation as to why it was required to be placed where it is; therefore, it was a mistake. No one has measured the window placement on the exterior and there are no reports confirming the placement of the basement window is correct and was checked. If its location is incorrect, the family room window, aligned with it, will also be incorrect.
Counsel for Tarion submitted that there has been no breach of warranty. The window is fully functional and its expected lifespan is normal. The rear wall family room windows are equidistant from the fireplace on the exterior of the home. The differential positioning of the windows on the interior is minor and aesthetic in nature and perfection is not the standard in construction. Moreover, should the Tribunal find that there is a breach of warranty, the Appellants have not produced any proof of damages, that is, evidence of harm arising from the defect, and therefore their appeal must fail. Finally, he noted that the cost of the Appellants’ suggested remedy of relocating the windows is disproportionately large.
The onus is on the Appellants to prove, on a balance of probabilities, that there has been a breach of warranty. This appeal arises out of an item submitted as part of the Appellants’ 30 Day Form. Therefore, the applicable warranty is set out in section 13(1) of the Act. Section 14 (b) of the Act requires the Appellants to show that they have incurred damages as a result of the breach. In reaching its decision, the Tribunal has relied on the evidence of the parties and has considered the authorities submitted by Counsel for Tarion.
Appellant S testified that there are no defects in the materials used to construct the east window in the family room and that he does not know whether or not it has been constructed in accordance with the Ontario Building Code. Therefore, the only basis on which the Appellants’ claim can succeed is if the window is not constructed in a workmanlike manner. In this regard, the Appellant testified that his only concern is the window’s location.
There is no dispute between the parties that the family room windows are not placed equidistant from the fireplace when viewed from the interior. The space between the west window and the fireplace is 4”. The space between the east window and the fireplace is 7”. Does this differential constitute a defect in workmanship?
Counsel for Tarion referred the Tribunal to Dirani (Re) [2005] O.L.A.T.D. No 155 (“Dirani”) which states with regard to assessing workmanship:
Although each case must of course be decided on its own merits, the Tribunal finds that certain principles have been applied in past cases to guide the Tribunal in its consideration of the facts. Where there are no industry standards set out in the Ontario Building Code Regulations or generally accepted Construction Guidelines, the Tribunal will generally look at such things as whether or not the item complained of still performs the function intended (functionality), the skill, expertise, proficiency and craftsmanship of the worker, and aesthetics.
The Tribunal went on to cite Goulet (Re) [2000] O.C.R.A.T.D. No. 51:
In determining whether or not there has been a defect of workmanship in a new home, one must consider a multitude of issues of which aesthetics certainly is part of the consideration but is not the prominent consideration. In this case the Applicants examined each repair issue with microscopic scrutiny. ..the warranties stated in the legislation are founded on the concept of what is reasonable and not on what is perfect.
One of the issues in Dirani was with respect to a dinette light fixture which did not align to the fixtures in the adjoining kitchen. The Tribunal denied the claim, finding it a minor defect given that a table could be centered under the light and could be used without impediment. Counsel for Tarion also referred the Tribunal to Peck (Re) [2006] O.L.A.T.D. No. 273, in which the Tribunal decided that a claim for uneven caulking around windows was not warranted because it was related to appearance only and did not affect functionality.
In Ontario (5793-ONHWPA-Claim)(Re) [2010] O.L.A.T.D. No. 169, with respect to a claim for tiles which the Tribunal found to be out of alignment, the Tribunal wrote:
There is no allegation that the tiles are not properly installed nor is there any indication that functionality is impaired. Therefore, the issue for the Tribunal to determine is whether the misalignment is so significant as to result in an aesthetically disturbing situation, which would be unpleasing to the normal viewer in normal viewing circumstances.
The Tribunal denied the claim. However, the Tribunal notes that in this case, the homeowners had not even been aware of the misalignment until it was brought to their attention by the Tarion Field Claim Representative.
Counsel for Tarion also submitted Ontario (4673-ONHWPA-Claim) (Re) [2008] O.L.A.T.D. No 301. In this case, the Tribunal warranted a claim for an off centre hall ceiling fixture, after noting that fixtures are generally centrally located to “most effectively illuminate the foyer”. The Tribunal concluded that the “visibly obvious and clearly off centre” location of the fixture constituted “a significant aesthetic deficiency amounting to a failure to construct in a workmanlike manner.”
While every case must be decided on its own merit, the cases cited above establish that aesthetic considerations cannot entirely be separated from assessment of functionality. In the case before the Tribunal, Counsel for Tarion submitted that the east family room window has no loss of functionality and that the spacing differential is minor. While the Appellants’ claim specifically includes “problems hanging drapes”, the Tribunal notes that the photographic evidence indicates that the rods and drapes are in place but that there is insufficient room to accommodate a decorative finial on the kitchen side of the east window. The fact that the homeowners may not be able to use the type of rod they wish to, does not comprise a defect in functionality. More importantly, Appellant S’s testimony is that he has no issue with the functionality of the window.
Mr. Hollmann testified that the window differential was visible when the drapes were pulled to the centre of the windows. The Tribunal notes that the windows are on either side of the fireplace which is generally considered to be the focal point of a room. Based on Mr. Hollmann’s testimony and having viewed the photographs of the windows, the Tribunal concludes that in the absence of drapes, the asymmetry in the window placement would be noticeable to most viewers, notwithstanding the fact that the difference is only 3” and, that, as Mr. Hollmann inferred, its impact can be minimized.
However, the fact that the differential is noticeable in the interior of the home is not the only aesthetic consideration before this Tribunal. The exterior must also be considered. In this case, the appearance of the family windows on the exterior is symmetrical. While Mr. Hollmann testified that he did not measure the spacing on the exterior, he also testified that there is one course of brick separating both the east and west window frames from the fireplace. He further testified that the measurements are on the exterior on the home’s plans and his conclusion after looking at the plans was that the home was built to them.
In his closing statement, Appellant S suggested that the symmetry of the windows on the exterior wall was in question because measurements had not been taken. However, he presented no measurements of his own although he had ample opportunity to obtain them. Mr. Hollmann’s observation was clearly set out in the November 13, 2015 Conciliation Report:
Tarion finds that the windows are performing as required, and although from the interior side the windows appear to be not centered, they are centered from the exterior.
While Appellant S stated more than once that the windows are not installed the way any architect would design, his only evidence in this regard was the existence of the interior differential. In this case, the fact that the evidence indicates the windows are symmetrical on the building exterior does not support that an error was made in their construction, as alleged by the Appellant. While there is no specific evidence in this regard, the implication is that some alteration or condition in the interior construction is responsible for the offset appearance of the east window. Further, the Tribunal notes that the Appellants signed the plans which include a disclaimer with respect to dimensions and elevations.
In cross-examination, Appellant S indicated that he did not agree that the impact on the exterior of his home would be noticeable if the family room east window were to be moved. This is speculation. The Tribunal appreciates that the Appellants are disappointed that their family room windows are not evenly placed and understands that it might well be their preference to have the window moved to create a symmetrical interior appearance, even if that resulted in an asymmetrical exterior appearance.
As noted above, the Tribunal agrees that the window spacing differential is likely to be noticeable to viewers unless its appearance is minimized by drapes or by some other design element. This is a legitimate aesthetic consideration. However, as noted above in Goulet, consideration of aesthetics, while a factor in assessing workmanship, is not the prominent factor. In this case, the evidence that the windows are fully functional, that the house was constructed to plans, and that the windows are properly aligned on the exterior of the home outweighs the interior aesthetic consideration in determining whether there is a defect.
Further, the Tribunal notes that in this case, there is no evidence of damages. Appellant S testified that he has no issues with the functionality of the east window. Rather, he indicated that the spacing differential is causing stress and that he is concerned that it will result in devaluation of his home on resale. The warranty under the Act is limited. Section 6(6) specifically excludes secondary damages which would include those related to health issues such as stress. Liddiard v. Tarion Warranty Corporation, 2009 CanLII 65801 (ON SCDC), [2009] O.J. No. 4912; 99 O.R. 3(d) 656 (Div. Ct.) at paragraph 52, sets out what is covered by the warranty and is relevant to this case in that it addresses the potential loss of a home’s value on resale:
What is conferred by the warranty is the right to have done that which should have been done correctly in the first instance or a sum of money to purchase the labour and materials to do so. Any loss or damage that is derivative of the failure to construct in accordance with s.13(1) is secondary and therefore excluded. Even assuming that causation can be shown, loss of value on sale of a property is derivative and secondary and excluded.
Notwithstanding that the windows 3” spacing differential may be particularly visible under certain conditions, the evidence indicates they have been properly installed and are fully functional. The Tribunal finds there is no defect in workmanship. There is no breach of warranty and no evidence of damages. Therefore, the Appellants’ appeal must fail.
ORDER
Pursuant to the authority vested in it under the provisions of the Act, the Tribunal directs Tarion to deny the Appellants’ claim.
LICENCE APPEAL TRIBUNAL
Mary Ann Spencer, Member
Released: April 27, 2016