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

Date: 2020-12-01

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

Between:

Valeria Scicluna Appellant

And

Tarion Warranty Corporation Respondent

DECISION AND ORDER

ADJUDICATOR: Patricia McQuaid, Vice-Chair

APPEARANCES:

For the Appellant: Self-represented

For the Respondent: Danielle Peck, Counsel

Date of hearing: October 6, 2020 by videoconference and by written submissions

BACKGROUND

1Valeria Scicluna appealed the Decision Letter dated November 4, 2019 issued by the respondent Tarion Warranty Corporation (“Tarion”) to disallow her claim for payment of her deposit on a condominium unit out of the guarantee fund pursuant to s. 14(1) of the Ontario New Homes Warranty Plan Act (the “Act”).

2The hearing commenced on October 6, 2020 by videoconference, as scheduled. As requested by the parties, and ordered by the Tribunal, a court reporter was present.

3At the commencement of the hearing, Ms Scicluna stated that she had no evidence to give and she was not prepared to have Tarion give any evidence. I explained that as a party to the appeal, Tarion did have the right to present its evidence at a hearing unless the appeal was withdrawn by the appellant or was otherwise resolved before the hearing. I also explained that Ms Scicluna had the right to cross examine Tarion’s witness and to make submissions to the Tribunal challenging Tarion’s evidence or lack thereof. However, the Tribunal could not foreclose Tarion’s right to submit evidence at the hearing of this appeal, even if the appellant chose not to provide evidence in support of her appeal.

4As set out in the Tribunal’s Order dated October 8, 2020, after discussion about a possible adjournment so that Ms Scicluna could obtain documents from a court file which she stated would likely support her appeal, we took a brief recess for her to consider this option. Following the recess, Ms Scicluna stated that she would not request the adjournment given that even the court itself had no evidence when it decided her case. I then asked counsel for the respondent to provide submissions on an issue related to the prior court proceedings. Ms Scicluna objected to this and stated that she would end her participation if I permitted Ms Peck to speak. When I did so, Ms Scicluna left the videoconference hearing.

5As a result, I ordered that the hearing continue as a written hearing. No oral evidence was provided on October 6^th. The parties were ordered to provide submissions according to a schedule, with the last of those submissions, the appellant’s reply submissions, due by November 2, 2020.

6Ms Scicluna did not provide any written submissions other than two emails dated October 22 and October 29, 2020, the latter in response to Tarion’s written submissions.

ISSUE FOR DETERMINATION

7This appeal involves one issue: the appellant’s claim for payment of her deposit on a condominium unit out of the guarantee fund pursuant to s. 14(1) of the Ontario New Homes Warranty Plan Act. The onus of proof in this appeal is on the appellant. Section 14(1) states as follows.

14 (1) Subject to the regulations, a person who has entered into a contract to purchase a home from a vendor is entitled to receive payment out of the guarantee fund for the amount that the person paid to the vendor as a deposit or other payment to be credited to the purchase price under the contract on closing if,

(a) the person has exercised a statutory right to rescind the contract before closing; or

(b) the person has a cause of action against the vendor resulting from the fact that title to the home has not been transferred to the person because,

(i) the vendor has gone into bankruptcy, or

(ii) the vendor has fundamentally breached the contract. 1998, c. 19, s. 185 (1); 2000, c. 26, Sched. B, s. 15 (2); 2017, c. 33, Sched. 4, s. 6 (1).

8Pursuant to s. 6(2) of Regulation 892/90 (Administration of the Plan), the maximum payable to a person out of the guarantee fund under s. 14(1) is $20,000.

RESULT

9I have reviewed and considered the information provided by Ms Scicluna with her Notice of Appeal, the Decision Letter issued by Tarion, the oral submissions made on October 6, 2020, and the subsequent written submissions of Tarion as well as the information provided by Ms Scicluna in the emails noted above. I am denying the appellant’s claim for payment under s. 14(1) of the Act.

FACTS AND ANALYSIS

10A brief review of the facts as set out in the written material referred to above is important for context. The appellant signed an agreement of purchase and sale for a condominium unit with the vendor, Solstice Two Limited (“Solstice”) in April 2008. She took interim occupancy of the unit in September 2010 but vacated the unit in January 2011. The unit transfer date was scheduled for May 5, 2011. The appellant did not complete the sale on that date. On June 16, 2011, the vendor’s solicitor sent an email to the appellant’s solicitor stating that the appellant was in default of her obligations under the agreement of purchase and sale. Further, the vendor’s email stated that if the transaction was not completed in five days, the purchase agreement would be terminated and the existing deposit monies would be retained. The vendor went on to state that alternatively, it would enter into a resale authorization agreement whereby all deposit monies except for $30000 would be returned to Ms Scicluna.

11Ms Scicluna signed the resale authorization agreement on October 20, 2011 and the vendor successfully sold the unit. The appellant did not sign a release as requested by the vendor because of her belief that it contained provisions that she did not agree to; specifically, that the vendor would retain $60000, not $30000.

12At the hearing on October 6 and in her emails, the appellant stated that she was never given notice of the closing. She asserts that she was never served with the notice that she allegedly missed, and that she is “innocent until the burden of proof is satisfied to which I am accused.” She stated that she did not have access at this point to the documents she needed to prove this but opined that Tarion could use its powers and exercise its due diligence to obtain documents from the vendor which would confirm her position. I reiterated to the appellant that this was not a case in which her guilt or innocence was being determined, but that she did bear the burden of proof to establish entitlement under s. 14 (1) of the Act.

13The fact that the appellant has provided no evidence to the Tribunal, and ended her participation in the hearing because she was not prepared to have the Tribunal hear evidence or submissions from Tarion means that she has not met her onus and as a consequence, her appeal may be denied. However, for completeness, I will address entitlement under s. 14(1) of the Act.

14Section 14 provides two grounds by which a person may receive payment out of the guarantee fund. They may be entitled to payment if the person has exercised a statutory right to rescind the contract before closing. There is no evidence of that before me. Alternatively, they may be entitled to payment if the person has a cause of action against the vendor resulting from the fact that the title to the home has not passed because the vendor has gone into bankruptcy or because the vendor has fundamentally breached the contract. There is no evidence of the vendor’s bankruptcy.

15Regarding the issue of a fundamental breach, I will refer to two court decisions involving the appellant and the vendor, Solstice, which were included in the respondent’s submissions. They are determinative of this issue.

16The appellant did pursue a cause of action against the vendor: she sought a declaration that she was entitled to the return of her deposit money before the Superior Court of Justice.¹ The matter was heard in May 2017 and Ms Scicluna was represented by legal counsel. The court found that the appellant failed to provide the balance of the purchase price to the vendor on the unit transfer date as required and therefore the appellant herself breached the agreement of purchase and sale such that the vendor could retain the deposit of $30,000. The court also found the resale authorization agreement to be valid.

17For reasons not directly relevant to the issue before the Tribunal, Solstice and Ms Scicluna both appealed the decision to the Court of Appeal.² Again, Ms Scicluna was represented by legal counsel. Both appeals were dismissed. In its analysis, the Court of Appeal noted that Ms Scicluna breached the amended agreement of purchase and sale (the “AAPS”). Further, the court stated the following at paragraph 26:

In finding against Solstice, I do not accept Ms Scicluna’s contention that the deposit was not forfeited. That is a difficult argument for Ms Scicluna to make given that she breached the terms of the AAPS that provided for forfeiture in the event of breach – especially in light of the fact that Solstice had advised Ms Scicluna that a failure to close would result in forfeiture…

18The courts have quite clearly determined that the appellant, not the vendor, breached the agreement of purchase and sale and therefore she was not entitled to the deposit monies. This Tribunal is bound by those findings. Even had Ms Scicluna provided evidence to the Tribunal, she cannot be permitted to relitigate here the same issues determined by the courts, and on the same standard of proof, in the hope of achieving a different result. There can be no finding that the vendor fundamentally breached the contract thereby triggering entitlement under s. 14(1) of the Act in light of these court decisions.

19The appellant’s situation may be complicated, as alluded to in her submissions at the hearing and as reflected in the court decisions, but any remedy that she may have arising from the transaction with Solstice does not include a claim for payment from the guarantee fund administered by Tarion.

ORDER

20For the reasons set out above, the Tribunal dismisses the appeal and orders Tarion to deny the appellant’s claim for the deposit refund as set out in the Decision Letter dated November 4, 2019.

LICENCE APPEAL TRIBUNAL

_______________________

Patricia McQuaid, Vice Chair

Footnotes

1. 1Scicluna v. Solstice Two et al., 2017 ONSC 3674
2. 2Scicluna v. Solstice Two et al., 2018 ONCA 176, 2018 ONCA176