Licence Appeal Tribunal

Safety, Licensing Appeals and Standards Tribunals Ontario

Tribunal d’appel en matière de permis Tribunaux de la sécurité, des appels en matière de permis et des normes Ontario

Citation: J.Y. v. Tarion Warranty Corporation, 2019 ONLAT 11837 ONHWPA Date: 2019-09-30

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

Between

J.Y. Appellant

-and-

Tarion Warranty Corporation Respondent

DECISION AND REASONS

ADJUDICATOR: Raymond C. Ramdayal, Member

APPEARANCES:

For the Applicant: J.Y., Self-represented

For the Respondent: Danielle Peck, Counsel

Heard in Toronto: June 6, 2019

OVERVIEW

1The appellant owns a residential home in Oakville, Ontario built by Mattamy (Preserve) Limited (the “Builder”). He took possession on February 4, 2015. The appellant submitted a claim for eight defects in his home. Tarion Warranty Corporation (“Tarion”) denied the majority of the warranty claim on December 3, 2018 (the “Decision Letter”).

2The items listed on the Decision Letter are as follows:

(1-5) | Exterior – Balcony – Water penetration of basement or foundation – water puddles in balcony and starts leaking through the corner.

(6-2) | Interior – Exterior cladding defects (e.g. exterior wall coverings, including siding and above grade masonry) – Grading problem that poses a tripping hazard in the stairs at the front of the house. Grading engineers by the city emailed me that Mattamy agreed to fix. Still not fixed.

(8-2) | Interior – Floor 01 – Kitchen – Violations of the Ontario Building Code’s health and safety provisions – Freezer and fridge door/enclosure misaligned. Frendel Kitchens Limited (Frendel) attempted repair but repair failed. Door is rubbing against the frame.

(8-3) | Interior – Floor 01 – Kitchen – Violations of the Ontario Building Code’s health and safety provisions – Paint on the Garbage door panel has peeled off. Previously reported Frendel attempted repair with white marker which didn’t stay for even 2 days.

(7-1) | Interior – Floor 01 – Great/Grand/Family Room – Window frame cracked and leaking air.

(1-2) | Interior – Basement – Unfinished Area – Floor cracks that are wide and having two different levels (uneven surfaces).

(1-3) | Interior – Basement – Unfinished Area – Several cracks that were not water tested in the Spring. Above grade leaks were repaired in WINTER from INSIDE by Blue Skin (and not all of them). Mattamy promised to redo the repair and retest in Spring.

(7-4) | Exterior – Garage (Exterior) – One of the garage door panel were defective and reported in the Pre-Delivery Inspection and 30 Days and still hasn’t been repaired.

3Items (1-2) and (7-4) were withdrawn by the appellant. This leaves items (1-5), (6-2), (8-2), (8-3), (7-1), and (1-3) remaining as part of this appeal.

THE LAW

4The appellant’s 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”).

5Sections 14 and 15 of Regulation 892 prescribe a number of warranties for a period of two years. This appeal involves items which were not on a second-year warranty form.

6Section 14 states that every vendor of a new home warrants to the owner that there will be no water penetration through the basement or foundation of the home. Section 15 states that the vendor also warrants to the owner that the home is constructed in a workmanlike manner, is free of material defects, has no Building Code violations and has no structural defects. The warranties apply only in respect of claims made during a two-year warranty period ending on the second anniversary of the date of possession.

7With regards to the initial claim form, section 4.2(6) of Regulation 892 states:

If the vendor does not repair or resolve all of the claim items listed on the initial claim form mentioned in subsection (5) by the end of the 120th day after the date on which the Corporation receives the form, 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 date on which the Corporation receives the form.

8In addition, section 4.2(7) of Regulation 892 states:

If the owner does not request conciliation under subsection (6) 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 initial claim form that the vendor does not repair or resolve by the end of the 150th day after the date on which the Corporation receives the form.

9With regards to the year-end form, section 4.3(5) of Regulation 892 states:

If the vendor does not repair or resolve all of the claim items listed on the year-end form mentioned in subsection (4) by the end of the 120th day after the later of the date on which the Corporation receives the form and the day before 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 later of the date on which the Corporation receives the form and the day before the first anniversary of the date of possession.

10In addition, Section 4.3(6) of Regulation 892 of the Act states:

If the owner does not request conciliation under subsection (5) 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 later of the date on which the Corporation receives the form and the day before the first anniversary of the date of possession.

Powers of the Tribunal

11After holding a hearing, pursuant to section 16(3) of the Act, the Tribunal can direct Tarion to take such action as the Tribunal considers appropriate and may substitute its decision for that of Tarion.

The Legal Framework

12The Act is consumer protection legislation and must be liberally construed. The onus is on the appellant to establish on a balance of probabilities that there has been a breach of warranty and that they have suffered damages as a result of the breach.

13The issues to be determined in this appeal are:

a. Whether the following are warrantable items and whether there has been a breach of warranty, particularly:

i. Is the balcony constructed in a workmanlike manner and free of defect(s);

ii. Does the exterior grading meet workmanship, materials and health and safety requirements;

iii. Are there defects to the kitchen freezer and fridge door which fall within the scope of the Second Year Warranty coverage and/or violates the Ontario Building Code’s health and safety provisions;

iv. Are there defects to the paint on the Garbage door panel which fall within the scope of the Second Year Warranty coverage and/or violates the Ontario Building Code’s health and safety provisions;

v. Is the window frame constructed in a workmanlike manner and are there defects which fall within the scope of the Second Year Warranty coverage; and

vi. Is there a breach of the Two-Year Water Penetration – Basement Warranty.

b. Whether the appellant has suffered damages as a result of any breach of warranty on any warrantable items.

RESULT

14The Tribunal denies the appellant’s appeal.

DECISION AND ANALYSIS

15The items being appealed were reported on the Tarion Second Year Statutory Warranty Form. This warranty includes the following:

• Protects against water penetration through the basement or foundation walls;

• Protects against defects in materials that affect windows, doors, and caulking and defects in work that results in water penetration into the building envelope;

• Covers defects in work or materials in the electrical, plumbing and heating delivery and distribution systems;

• Covers defects in work or materials that result in the detachment, displacement or deterioration of exterior cladding (such as brickwork, aluminium or vinyl siding);

• Protects against violations of the Ontario Building Code that affect health and safety; and

• Applies for two years, beginning on the home’s date of possession.

16Similar to the 30 day and one-year warranties, homeowners are mailed a letter from Tarion after submitting their deficiency lists. This letter provides information on the next steps which must be followed if any warrantable items are not resolved by the builder by a certain time.

17The appellant did not request a conciliation inspection by the specified time so that Tarion could assess the items that are in dispute. As a result, and as stated in the Tarion letter, the items were deemed to be withdrawn. Items can only be warrantable if a conciliation inspection takes place.

18In addition to this, the items fall outside of what the second-year warranty was designed to cover.

19I find that the appellant did not request a conciliation inspection because he relied on the builder’s promises only to later realize that his concerns were not resolved causing him to miss his period of appeal. Evidence put forward during the hearing appeared to confirm this with emails from 2018 between the appellant and the builder where commitments to repairs were being made after the second-year form was submitted.

20The Tribunal heard that the builder agreed to make certain repairs. They were outlined in multiple vendor/builder and owner agreements signed by the appellant on August 10, 2017, September 22, 2017, December 13, 2017, and February 22, 2018. The appellant stated that he was informed by Tarion staff that he would not lose his rights by signing the builder’s agreement. The agreement also states that signing the document is not an admission that the item is warrantable. The appellant explained that he has been cooperative with the builder and has been understanding of multiple delays in repair dates he was promised.

21The vendor/builder and owner agreements clearly state that if the vendor/builder does not repair or resolve the outstanding items by the repair deadline stated on each agreement, then the owner must contact Tarion within 30 days after the repair deadline date in order to request that a conciliation inspection be scheduled.

22Ms. Karla Roelofsz, Tarion Warranty Services Representative, appeared as a witness for the respondent. She confirmed the duties of Tarion which includes conducting conciliation inspections for warrantable items not resolved by the builder. In addition, she provided general information about the Construction Performance Guidelines and the Ontario Building Code.

23The Tarion Representative stated that she inspected the items on two separate occasions, September 6, 2018 and February 5, 2019, in the context of the second-year warranty. She took photographs both times. She explained that the second-year warranty would include water penetration through the building envelope, Ontario Building Code Violations for health and safety, exterior cladding, electrical, plumbing pipes and furnace.

24The Tarion Representative stated that appellant was given time to request a conciliation inspection on outstanding items not addressed by the builder. Tarion would then assess the items to determine if they are warrantable.

25The appellant admitted to not submitting claims for the items currently being appealed on time. Nonetheless, he believes they should be warrantable.

26I consider each of the items in turn.

Item (1-5) | Exterior – Balcony: Water penetration of basement or foundation

27Item (1-5) is an issue of water puddling on a non-accessible balcony which is directly above the front door porch leading into the house. This balcony has no doors and therefore the area cannot be easily accessed by the homeowner. There is also no practical way to clear off any accumulating snow during winter months. During times of heavy rainfall, or when accumulated snow melts, the water puddles on the balcony and starts to run down the stone walls of the porch.

28The respondent states that the water coming from the balcony was not on the 30-day form. The appellant argued that it was noted as item 111 on the one-year form, which related to a downspout. The builder completed repairs for this item in 2017 and 2018. The builder was required to make repairs in 2016. The appellant did not request a conciliation inspection indicating that the item was not resolved.

29I find that this item falls outside the scope of the second-year warranty. The appellant confirmed that there was no water penetration into the home as a result of the water puddling on the balcony. I find that this is not a warrantable item.

Item (6-2) | Interior – Exterior cladding defects: Grading of front porch landing

30Item (6-2) is an issue of exterior cladding defects which the appellant submits involves improper grading. The stairs leading up to the porch of the house have a wide landing which is then separated by a grass patch in between the sidewalk. The appellant states that this landing is positioned too high and is a tripping hazard for those using it. He also stated that it is not constructed properly. For this reason, he does not allow his children to use the front door. The appellant also stated that it is difficult for visitors to navigate the landing causing them to walk onto the grassy patch, which is at a lower elevation, placing them at risk to fall. There is a step leading off the landing towards the driveway.

31At the hearing, the appellant submitted multiple photographs of his landing compared to those of others in his neighbourhood. The appellant was also granted the opportunity to provide post-hearing submissions in the form of photographs which were re-taken to allow a clearer depiction of the onsite condition. This was allowed on the basis that the original photographs were taken at dawn in poorly lit conditions.

32The pictures did not convince me that a breach of warranty exists for the appellant’s home. Each lot is unique with respect to its own grading requirements.

33The respondent states that the grading was inspected by both the municipality and a licenced engineer. There have been no orders issued by the city to comply with revisions to the grading. In addition, the respondent provided an email, dated August 3, 2017, from the engineer to the appellant stating that the grading is deemed complete.

34The landing, which is comprised of patio stones, is not fixed but rather sits on a frame and is packed with gravel on the inside to provide stability. It is a reasonable expectation that weather or settlement may cause them to move from time to time. There was no evidence presented at the hearing which demonstrated that they were unstable at the time of the Tarion inspections. The appellant provided a video which shows the stones shifting under his weight, however, I find this to be part of the appellant’s responsibility to ensure enough gravel is packed under the stone to prevent shifting due to weather conditions and settlement. Accordingly, this would fall under routine maintenance by the homeowner.

35I also note that the subsidence of land is expressly excluded as a warrantable item as set out in section 13(2) of the Act.

36The appellant’s argument that this represents a breach of the Ontario Building Code was also considered. However, the drop from the landing to the ground is less than 24 inches, meaning that no guard is needed according to the Ontario Building Code.

37I acknowledge that the construction and layout of the landing is less than ideal. Visitors leaving the home do not intuitively know that they must turn towards the side steps when coming down from the landing. In addition, the steps’ proximity to the city sidewalk may contribute to this confusion. However, given the fact that the grading has been passed by the municipality and that there are no breaches of the Ontario Building Code or the construction performance guideline, this item is not warrantable.

Item (8-2) | Interior – Kitchen: Misalignment of freezer and fridge door/enclosure

38Item (8-2) involves a freezer and fridge door which are misaligned and rubbing against the frame. This item is not warrantable under the second-year warranty. It would have potentially been considered during the 30-day or one-year warranties. However, the appellant did not submit a claim for this item at that time. The Act is very specific with regards to the timeline for reporting of deficiencies to Tarion. This item, along with the others involved in this appeal were not submitted within the appropriate time frame.

39The Tarion representative testified that any binding may be the result of humidity levels in the home. The Tribunal has no way to determine if this is the result of improper installation or ambient humidity levels. The Tarion representative also testified that when she attended the residence, she did not observe the door to be rubbing or binding.

40The appellant provided testimony that the rubbing or binding that is occurring is not the result of humidity in the home but due to improper construction.

41I find that this item ought to have been reported earlier if it was a construction or design defect. The appellant had previous opportunities to report this item but failed to do so. There is no breach of the second-year warranty.

Item (8-3) | Interior – Kitchen: Peeled paint on the garbage door panel

42Item (8-3) involves paint peeling off the handle of a garbage panel. The appellant advised that a repair was done but did not last and the problem reappeared. The appellant argues that the respondent’s argument that this is normal wear and tear is unreasonable given only a year has gone by.

43I find that the peeling paint may be an indication of another problem of the paint not adhering properly to the surface. One would expect paint to remain adhered to the surface for longer than one year without experiencing peeling. However, the appellant is making this claim under the second-year warranty which, as described in paragraph [14], does not warrant items of this nature.

Item (7-1) | Interior – Great room: Cracked window frame

44Item (7-1) involves a window frame which the appellant describes as being cracked. The respondent stated that the item was previously repaired and painted. A photograph submitted during the hearing shows moisture. There is also a dark area which may or may not be mould. This condition is likely the result of condensation and now falls under homeowner maintenance.

45The determination of whether the window is leaking and allowing cold air into the home is a difficult one. The Tarion representative stated that the moisture could be the result of normal convection which is when warm air reaches the cold surface of the window which may lead one to believe that there is a leak when in fact there is not. In this case, it was not cold enough outside to make that determination when the Tarion representative conducted her inspection. Also, the frame around the window is not considered to be a part of the window system as defined under the second-year warranty. I find that this item is not warrantable under the second-year warranty.

Item (1-3) | Interior – Basement: Cracks in unfinished area

46Item (1-3) involves a complaint of a leak in the basement. The Builder made repairs in 2017 and 2018. During Tarion’s inspection and water test, there was no leak observed suggesting that the repairs were successful. The appellant also confirmed during the hearing that there has not been a leak observed for over one year. Nonetheless, the appellant is concerned that it may begin to leak again in the future.

47I find that there is no deficiency present in the basement as it pertains to water penetration. This was confirmed by the appellant. The warranty cannot protect against a future assumption that a water leak will occur. I am satisfied that the item was inspected, a water test was conducted and no leak was detected.

CONCLUSION

48The items being appealed were reported on the second-year form which relates to warranties for the second-year claim period defined in the Regulation as the period beginning immediately after the first anniversary of the date of possession and ending on the second anniversary of the date of possession, in the case of a warranty claim made under section 4.4.

49The items fall outside what the second-year Tarion warranty covers. Paragraph [14] sets out in general terms what those items are. In addition, the appellant missed critical dates for requesting conciliation inspections from Tarion. There is a regulatory stipulation under Regulation 892 s. 4.4 regarding second-year claims that, if conciliation is not requested, the owner is deemed to have withdrawn the unresolved claim items listed on the second-year form.

50The appellant has expressed frustration but also acknowledgement that he missed the deadline to report the items being appealed. During the hearing, he stated that he does not believe that it is fair to use a procedural shortcoming as a way for the builder to get away with what they did.

51I find that the timelines and procedure which the appellant refers to are prescribed in legislation and do not form part of a policy or guideline. As a result, they must be followed strictly and accordingly.

52I understand the challenge of navigating the requirements of timelines for the warranties and the complexity of the Act, however, they are clearly prescribed. I find that the appellant has failed to satisfy the onus of proving a breach of warranty or a violation under the Ontario Building Code for any of the items being appealed.

53I find that there is no breach of the second-year warranty. I also find that the appellant failed to establish that he has suffered damages as a result of any of the alleged breaches of warranty. The builder has already resolved some of the issues and the outstanding items are relatively minor without any damages incurred by the appellant as a result.

ORDER

54For the reasons explained above, I order Tarion to deny the appellant’s appeal.