Amanj Rahman and Elmina Iusifova v. Tarion Warranty Corporation, 2025 CanLII 25877

Licence Appeal Tribunal File Number: 16201/ONHWPA

In the matter of an appeal from a decision of Tarion Warranty Corporation under section 14 of the Ontario New Home Warranties Plan Act, R.S.O. 1990, c. O.31 (the “Act”).

Between:

Amanj Rahman and Elmina Iusifova

Appellants

and

Tarion Warranty Corporation

Respondent

DECISION

ADJUDICATOR: Bruce Stanton

APPEARANCES:

For the Appellants: Amanj Rahman (self-represented) Elmina Iusifova (self-represented)

For the Respondent: Steve Sarazin, Representative Suzanne Chandrakumar, Counsel

Court Reporters: Josh Grieve, Chris Delic, Charlotte St. Croix

Heard by videoconference: February 18, 19, and 20, 2025

OVERVIEW

1Amanj Rahman and Elmina Iusifova, the appellants, appeal from a decision letter issued by Tarion Warranty Corporation (“Tarion”) dated August 9, 2024 (the “DL”) in relation to 29 claim items on the appellants’ 30-day statutory warranty form.

2On February 10, 2025, the parties entered into an agreement to narrow the scope of the hearing. The appellants withdrew all but nine of the 29 items listed in the DL and added claim item 126 from the 30-day form, for a total of 10 claims remaining in dispute.

3Additionally, at the start of the hearing, the parties settled claim items 83 and 87, leaving only seven remaining claims (14, 25, 27, 58, 60, 71 and 107) from the DL, plus item 126.

4Tarion has determined that claim items 14, 25, 27, 58, 60 and 107 constitute breaches of warranty and has offered compensation from the Fund for them; however, the appellants declined to accept the offered compensation.

5Tarion determined that claim item 71 is not a breach of warranty.

6The appellants have the onus of demonstrating that claim item 71 constitutes a breach of warranty and, if so, the amount of damages arising from it, and the amount of damages they seek for the warranted claim items (14, 25, 27, 58, 50 and 107).

PRELIMINARY ISSUE

Claim item 126 is not properly before the Tribunal

7Although the parties, in their February 10, 2025 agreement, agreed to add claim item 126 from the 30-day form as an issue for the hearing, I find that it is not properly before the Tribunal.

8Section 14(13) of the Act stipulates that when Tarion makes a decision in respect of a claim, it must serve notice of the decision, with reasons, to the homeowner making the claim. Section 14(14) requires that the notice issued under s. 14(13) must advise the homeowner they are entitled to appeal the decision to the Tribunal. Section 14(17) compels the Tribunal to appoint a time and hold a hearing if it receives a notice of appeal from a homeowner pursuant to section 14(14).

9The appellants submitted that because of the significant amount of time that has already been expended in attempting to conciliate and resolve the defects on the 30-day claim form, it would be expedient to add item 126 to the hearing. However, after some discussion of the issue the appellants agreed that claim item 126 is not properly within the scope of the hearing.

10Tarion submits that the claim process is still underway for this item and because it is not part of the DL, the Tribunal has no jurisdiction to make a decision in regard to its warrantability or the amount of damages associated with it.

11As much as it may seem expeditious to include item 126 in the hearing, it is not within the Tribunal’s jurisdiction to conduct a hearing on it. The Act effectively limits the authority of the Tribunal to hear only the matters on which Tarion has issued a decision pursuant to section 14(13). Accordingly, item 126 is not properly before the Tribunal.

ISSUES

12The issues to be determined in the hearing are:

1. Whether claim item 71 constitutes a breach of warranty and, if so, the amount of the damages arising from the breach of warranty; and

2. What is the amount of damages arising from the breaches of warranty in claim items 14, 25, 27, 58, 60 and 107.

RESULT

13Claim item 71 (lack of heat in bedroom 3) constitutes a breach of warranty and shall resume the conciliation process under the Act and regulations. The amount of damages in relation to this claim item is yet to be determined.

14Tarion is directed to pay compensation in respect of the damages arising from warranted defects in the following claim items:

Item	Defect/Deficiency	Amount
14	Paint and finishing ceilings – main floor and second-floor	$1,695.00
25	Kitchen backsplash	141.25
27	Mounting brackets, cooktop	452.00
58	Vanity cabinets, ensuite	2,542.50
60	Water supplies to bathtub	655.40
107	Kitchen island countertop, waterfall	7,232.00
Total		$12,718.15

ANALYSIS

Claim Item 14 – defects in main floor and second-floor ceiling paint/finishing

15I find, on a balance of probabilities, that the appellants have not proven that the amount they seek to complete repairs of this defect is merited. I find the appellants are entitled to compensation from the Guarantee Fund (the “Fund”) in the amount of $1,695.00, representative of $1,500.00 plus HST.

16Section 14(3) of Act stipulates that an owner of a home is entitled to receive payment out of the Fund for damages resulting from a breach of warranty. The parties do not dispute that the defects relating to the ceiling areas are warranted but they disagree on the amount of compensation. As noted above, the appellant has the onus of demonstrating that the $1,695.00 offered by Tarion is insufficient to remedy the warranted defects and rather, that the amount they propose is required.

17Mr. Rahman, on behalf of the appellants testified that the $1,695.00 offered by Tarion is not fair. He obtained a quote from PerfectPRO Painters based on 1146 sq. ft on the main floor and 1258 sq. ft on the second floor, in the amount of $7,418.45. Rahman also referred me to a quotation to paint the entire ceiling on the main floor and second floor hallway, based on approximately 1200 sq. ft. by Unlimited Building Solutions (“UBS”) in the amount of $7,800.00 + HST = $8,814.00. He notes the UBS estimate was one that Tarion arranged in respect to claim item 14 in the home.

18Mr. Rahman submits that because the estimate that informed Tarion’s proposed compensation, by Burke’s Restoration (“Burkes”) in the amount of $1,500.00 + HST was significantly lower than the PerfectPRO and UBS quotes, it does not accurately reflect the actual cost of the work. He submitted that the large discrepancy suggests Burkes scope of work for the job is not accurate.

19On cross examination, Mr. Rahman testified that PerfectPRO did not visit the home to prepare the quote.

20Steve Sarazin, Manager of Warranty Services at Tarion, testified that the compensation proposed for the paint defects was based on the Burkes estimate and that Burkes visited the home prior to estimating the cost of the repairs. He testified that the scope of work was to repaint the whole first floor ceiling and the ceiling of the second-floor hallway and referred me to the Burkes estimate of December 18, 2023. The scope of work for the Burkes estimate includes “cleaning, caulk/fill/mud/tape if needed, sand smooth and prep for paint, prime repair area and blend finish, and paint as required to repair area and blend finish to best match possible.”

21Mr. Sarazin testified that Burkes is prepared to conduct the repairs at that price.

22Tarion submits that, per the court’s decision in Liddiard et al. v. Tarion Warranty Corporation, 99 OR (3d) 656, 2009 CanLII 65801 (ON SCDC) at paragraph 52, the warranty plan confers the right to have done which should have been done correctly in the first instance (or a sum of money to purchase the labour and materials to do so). The appellants, it submits, are only entitled to the cost of affecting those repairs.

23I find the Burkes estimate is sufficient to address the defects in claim item 14 and the appellants have not proven that the damages from this item go beyond it, nor that the amount offered is insufficient.

24I give weight to the Burkes estimate because the scope of repair aligns with the description of the defects on the claim form, which was confirmed in Mr. Rahman’s testimony (second-floor hallway and entire first-floor ceiling), they attended the home to prepare the quote, and they are prepared to complete the work at that price.

25By contrast, the PerfectPRO estimate seems to include the entirety of the second-floor ceiling, not just the hallway. Plan drawings provided in the appellants’ documents show the second-floor area is 1258 sq. ft, the same as noted in the PerfectPRO quote for the second floor. The second-floor hallway area, on the same document, identifies the hallway area as 136 sq. ft. I give little weight to the PerfectPRO quote because it goes beyond the agreed scope of repair for item 14 and PerfectPRO did not visit the home before providing its estimate.

26I give less weight to the UBS quote of $8,814.00 because it is significantly higher than Burkes and there is no evidence before me explain the significant difference in the amounts.

27I agree with Tarion that the appellants are entitled to no more than the amount of compensation necessary to remedy the defects. In this case, the appellants have not demonstrated why the Burkes quote is not sufficient.

28I find the appellants are entitled to compensation in the amount $1,695.00 for claim item 14, per the Burkes quote.

Claim Item 25 – caulking of backsplash at kitchen counter

29I find the appellants are entitled to $141.25 ($125.00 + HST) in respect to caulking at the kitchen counter backsplash.

30Mr. Rahman testified that the quartz backsplash in the kitchen was an upgrade in the Agreement of Purchase and Sale (“APS) valued at $3,574.00 + HST. He testified that when they moved in, the backsplash had not yet been completed. I take notice that the 30-day form describes the warranted item as “upgraded kitchen backsplash not installed”.

31Mr. Rahman testified that the builder made three attempts to install the one-piece backsplash, and, in the process, the drywall behind the area became damaged to the point of constituting a contravention of s. 13(1)(a)(ii) of the Act (for not being constructed in a workmanlike manner.

32Mr. Rahman testified that he is solely seeking reimbursement for costs of this backsplash installation. He did not specify whether the reimbursement was for the cost of the upgrade or the cost of removing the backsplash and addressing what he considers to be defects in the wall construction behind the quartz that, he argues, does not meet the Ontario Building Code (OBC).

33The appellants submitted they were dissatisfied with the backsplash installation by the builder, noting that it was not completed upon pre-delivery inspection (PDI), it took three attempts across eight months to finally install it, and the builder’s crew always left a mess to be cleaned up afterwards.

34The appellants submit that the wall behind the backsplash is defective and will not support the quartz backsplash securely enough. They submit that the backsplash panel(s) need to be removed to facilitate removing the kitchen countertop in relation to claim item 27.

35Mr. Rahman testified that the appellants should be compensated for the cost of the quartz backsplash in the amount of $3,842.28 + HST, referring me to an estimate from Home Depot dated October 25, 2024.

36Mr. Sarazin testified that the backsplash has since been installed but was not caulked correctly. He added that the compensation offered was based on an estimate of Burkes to caulk the backsplash and Burkes is willing to complete the work at that price. He testified that it is not necessary to replace the backsplash as there is no defect or deficiency with it.

37I find that the appellants are entitled to $141.25 in respect to claim item 25 because the appellants have not met their burden in demonstrating that the amount of damages arising from this claim item exceeds the Tarion offer, i.e. that the $141.25 is not sufficient.

38I am not persuaded by the appellants’ argument that they should be compensated for the value of the quartz backsplash upgrade because there is no evidence before me to suggest that the backsplash or the wall structure supporting it is deficient. It is evident to me that, save the missing caulking, this 30-day claim (backsplash not installed) has been resolved by the builder.

39I find the appellants are entitled to $141.25 in respect to the damages associated with claim 25, to complete the caulking of the backsplash panels.

Claim Item 27 – mounting brackets for in-counter stovetop

40I find the appellants are entitled to $452.00 in relation to the defect in claim 27, represented by the Burkes quote of $400.00 + HST.

41Mr. Rahman testified that the opening provided in the main kitchen countertop to accommodate the electric cooktop was wider than specified. He directed me to amendment #90031 of the APS that specified a 36” Induction Cook Top instead of the gas cook top. Mr. Rahman testified that he supplied the builder with the specifications for the opening in the counter, but the opening in the installed countertop was 6 to 7 mm too wide. This resulted in the receiving bracket, mounted on the inside edge wall of the opening, being unable to connect with the corresponding bracket on the side of the appliance.

42The appellants submit that they declined Tarion’s proposed compensation because the estimates to remedy this defect did not specify the scope of work or details as to how the bracket(s) could be corrected to support the weight of the cooktop. They submit that only a proper installation method would prevent the warranty on the appliance from being voided.

43The appellants submit that the entire kitchen countertop needs to be replaced so that the opening can be manufactured to the correct specifications for the cooktop. Only in this way, the appellants submit, will the mounting brackets work as intended. The appellants submitted that the cost to replace the kitchen counter is $3,473.92, based on an estimate from Home Depot dated October 19, 2024. They submit this is the amount of damages arising from this defect.

44Mr. Sarazin testified that the mounting brackets were installed incorrectly and the left side bracket is not supporting the weight of the appliance as intended. He stated that the scope of work to remedy this warranted defect is to supply and install new brackets to the underside of the cooktop. Tarion used the in-house Xactimate software, a recognized construction estimating program, to calculate the cost of the repair at $550.62. The estimate included new support brackets and three hours of work by a cabinet installer.

45Mr. Sarazin testified that the compensation offered was based on the Burkes quote for the same scope of work, to supply and install brackets or supports at the underside of cooktop cut out.

46Tarion submits that the appellants are not entitled to replacement of the countertop when a reasonable repair will suffice and directed me to the Tribunal decision in Cheung v. Tarion Warranty Corporation, 2024 CanLII 4251 (ON LAT) (“Cheung v. Tarion”), in which the Tribunal found the appellant was entitled to a reasonable repair of the defect, not a complete replacement of the materials, in that case, hardwood flooring.

47Tarion submits that the appellants have not demonstrated that the compensation offer is insufficient to remedy the repair, which is their burden.

48I find the Burkes quote of $452.00 to fix/replace the mounting brackets for the cooktop appliance is the correct compensation for the damages to this warranted defect.

49I am not persuaded by the appellants’ argument that the entire countertop must be replaced in order to repair this defect. The appellants have not presented evidence to convince me that installing suitable mounting brackets would void the warranty on the appliance.

50I am not bound by previous decisions of the Tribunal, but I take guidance from Cheung v. Tarion because the circumstances are similar. In the case before me, the appellants argue the right remedy is a complete replacement of the countertop rather than simply supplying mounting brackets that will support the weight of the appliance as intended.

51I give weight to the Burkes quote for this work because the scope of work aligns with the defects reported on the claim form (to correct the detached appliance brackets) and as noted, Burkes is prepared to complete the work for that price.

52I agree with Tarion that supplying and installing mounting brackets that will support the weight of the appliance as intended, is a reasonable repair.

53I find the appellants are entitled to $452.00 in compensation in respect to this warranted defect because it is sufficient for a reasonable repair and the appellants have not demonstrated they are entitled to more compensation than has been proposed.

Claim Item 58 – master bedroom ensuite vanity cabinet

54I find the damages from this warranted defect to be $2,542.50 ($2,250.00 plus HST) as set out in the Burkes quote, to remove and replace the existing vanity with one that is configured according to the accepted design.

55Mr. Rahman testified that the cabinet/vanity for the ensuite bathroom was not supplied as agreed to in the APS. He stated that the appellants paid extra to upgrade the vanity countertop to quartz silestone, model Classic Calacatta, and an upgrade to American Standard Studio Undermount sinks. The cabinet was to have two drawers on either side of a centre make-up area/desk slightly inset (lower) from the countertops at either side. Each side of the make-up area would have its own undermount sink.

56Mr. Rahman testified that Potvin Kitchens and Cabinetry, the cabinet supplier, agreed that the cabinets supplied did not meet the design plan and they offered a refund which the appellants declined.

57Mr. Rahman testified that they received two estimates to replace the vanity cabinets with one configured and specified as in the APS:

1. Dymon Kitchen and Closet, $6,000.00 + HST = $6,780.00 (cabinets only)

2. Deslaurier Custom Cabinets, $5,490.00 + HST = $6,203.70 (cabinets only)

58Mr. Rahman noted that neither the Dymon or Deslaurier quotes included plumbing hookups, removal of the existing cabinets, or reinstalling the undermount sinks. Mr. Rahman testified that removing the sinks from the existing cabinets may also render them unusable in the new cabinets. He presented evidence that new sinks would cost $434.00 each, plus HST, i.e. a total of $980.80.

59Mr. Rahman directed me to an estimate of UBS obtained by Tarion which put the cost of the repair/replacement at $8,725.00 + HST = $9,859.30. The scope of work for the UBS quote included removing and replacing the ensuite vanity with a similar model, as per the selected item, including a dropped makeup station, reconnecting the waterlines and drains, reinstalling the vanity sinks, and caulking as required.

60The appellants submitted that the UBS quote properly reflects the damages associated with this warranted defect and they submit the Burkes quote must be incorrect because the amount they propose is significantly lower than the UBS, Dymon and Deslaurier estimates.

61Tarion submits that the Burkes proposal to repair this item, at $2,542.50, accurately reflects the cost to remedy this defect. Mr. Sarazin directed me to the Burkes quote, which describes the repair as removing and replacing the existing vanity with a model as per the selected item, closest match possible, to be supplied by Potvin Kitchens and Cabinet, including a disposal charge, disconnecting and reconnecting the waterlines and drains, and removing and reinstalling the vanity sinks and faucets, including caulking as required.

62Mr. Sarazin testified that Burkes is prepared to conduct the repair/replacement at that price and to those specifications.

63Tarion submits that the scope of work identified in the Burkes quote is almost identical to the UBS quote and the appellant has not demonstrated how or why the Burkes proposal is insufficient to properly repair the deficiency.

64I find, on a balance of probabilities, that the appellants are entitled to compensation of $2,542.50 for this claim item.

65While I am curious to understand the significant difference between the UBS and Burkes estimates, for what I agree is nearly an identical scope of work in each, I conclude, based on the evidence before me, that Burkes proposal is sufficient to correct the deficiency claimed by the appellants. That Burkes attended the home, inspected the deficiency, and is prepared to conduct the repair and replacement at that price, is compelling. It persuades me that their estimate to remedy the deficiency in this claim is credible and sufficient.

66I give less weight to the Dymon and Deslaurier quotes because, in the former, the document the appellants referred me to simply had a price ($6,000.00) with no specifications, and neither proposal included the additional costs of removing existing cabinets, disposal or the associated plumbing work required.

67I am not persuaded by the appellants’ assertion that the higher, UBS quote, is more credible because there is no evidence before me that rationalizes the significant difference between it and the Burkes quote. I agree with Tarion that the appellants have not proven why the Burkes quote is insufficient.

68Accordingly, I find the amount of damages arising from this claim is $2,542.50.

Claim Item 60 – hot and cold-water supplies to bathtub inverted

69I find the damages from this claim item to be $655.40, representative of $580.00 + HST, to correct the plumbing supplies to the bathtub.

70Mr. Rahman testified that when the second-floor bathtub was installed, the hot and cold water at the faucets was reversed, i.e. cold water came out of the right-hand side, hot water faucet, and vice versa. He testified that to correct the plumbing, the entire tub would need to be removed and replaced with a new one. He stated there is no way to correct the plumbing without removing at least a portion of tub, and doing so will damage it. Therefore, he testified, the plumbing needs to be fixed and the entire tub needs to be removed and replaced at a cost of $2,603.00, plus installation at $1,350.00, plus HST on both.

71In his closing submissions, Mr. Rahman stated that the appellants would accept $1,525.50 in compensation for this defect in the plumbing, based on an estimate by Summit Drain Plumbing and Waterproofing (“Summit”) to install a free-standing bathtub similar to the appellants’.

72Mr. Sarazin testified that actions to switch the hot and cold-water supplies back to their proper configuration would involve removing the top half of the bathtub but it could readily be reinstalled after the waterline corrections were made. He referred me to the Burkes quote of $655.40 to reconfigure the hot and cold-water supplies to the ensuite soaker tub which is based on four hours labour by a plumber at $145.00 per hour, plus HST.

73Tarion submitted that the appellants have not advanced a comparable estimate to simply fix the defect (the reversed hot and cold-water supplies). Tarion submits the appellants have not demonstrated that the Burkes proposal is not sufficient to remedy the reported defect in this claim and therefore the amount of the Burkes estimate should prevail.

74I find the appellants are entitled to $655.40 in compensation based on the Burkes estimate.

75I give weight to the Burkes proposal because they attended the home and are prepared to remedy the defect for the amount quoted.

76I am not persuaded by the appellants’ submission that $1,525.00 is the correct amount of damages from this claim because the estimate by Summit was based on a different scope of work, i.e. to install a new, free-standing tub. In addition, the appellants have not offered an alternative estimate of costs and scope of work to remedy the reported defects (the reversed hot and cold water supplies). The warranty coverage under the Act is intended rectify, or provide compensation sufficient to rectify, a warranted defect, i.e. correct it to the standard that was intended. In Cheung v. Tarion, the Tribunal has found that a complete replacement of the material was not required when a reasonable repair would remedy the defect. I am persuaded to apply that reasoning here.

77I find the appellants have not demonstrated that Tarion’s compensation offer is insufficient to remedy the defects in the waterlines to the tub.

78I find the appellants are entitled to $655.40 in respect to the warranted defects in claim item 60.

Claim item 107 – kitchen island countertop and waterfall

79I find the appellants are entitled to $7,232.00 ($6,400.00 + HST) in respect to the damages arising from this warranted defect. The amount is based on an estimate by Burkes to remove and replace the existing island countertop and the waterfall stone panels along the side of it.

80The parties agree that the veins in the island countertop, where they join the vertical waterfall panels, do not match within the agreed tolerance of ¼ inch. The veins at the joint of the installed countertop and vertical waterfall panels were measured to be up to 1.5 inches apart.

81The appellants obtained an estimate from Home Depot (supply) and Granit Design (install) to remove the existing and supply and install a new countertop and waterfall panels at the kitchen island, for $11,090.00 ($9,814.25 + HST). Mr. Rahman also directed me to an estimate by UBS which had been obtained by Tarion, for $11,140.00 plus HST = $12,588.20.

82Mr. Rahman testified that, according to the APS, the joint at the island countertop and waterfall is supposed to be mitre cut at 45 degrees and this mitre cut could mean the veins will be unmatched from 1/8 to 1/4 inches at the joint. Mr. Rahman testified that neither the UBS estimate, nor the Burkes estimate includes a mitre cut at the joint.

83The appellants submitted that the Home Depot/Granit Design and the UBS estimates are closely aligned yet the Burkes quote is much lower. They submit that the Burkes estimate is therefore inaccurate.

84Tarion submitted that the Burkes estimate is accurate and credible and includes the appropriate scope of work. It includes removing and disposing of the defective stone, replacing it with new countertop and waterfalls, removing and reinstalling the sink and faucets, reconnecting the plumbing, and caulking as required.

85Tarion submitted that the appellants have not met their burden in proving that the $7,232.00 offered by Tarion is insufficient to remedy the defective installation to the correct specifications.

86I find the appellants are entitled to compensation in the amount of $7,232.00 based on the Burkes quote.

87I give weight to the Burkes estimate because they are prepared to conduct the installation for the amount they proposed and they attended the home.

88In addition, the scope of work set out by Burkes appears to address all the elements of the job, including plumbing, disposal, etc. It does not specifically address the appellants’ concern about the mitre cut but notes it will achieve the closest match available to the counter supplied by Potvin Kitchens and Cabinet. The scope of work they propose aligns with the specifications in the APS, therefore the quote should cover the mitre cut as suggested by the appellants.

89I give less weight to the Home Depot/Granit estimates because they do not include the same scope of work (plumbing, disposal) and I have no evidence that they attended the home to prepare the estimate.

90Although the evidence before me suggests UBS attended the home to prepare its estimate and the scope of work it proposes appears to be complete (e.g. includes plumbing, disposal, etc.), there is no evidence before me to suggest why it is significantly higher than the Burkes quote.

91The appellants argue that because UBS and Home Depot/Granit quotes are similar, they should be given more weight. I disagree. There is no evidence before me to explain why the UBS or Home Depot/Granit estimates are from $2,500.00 to $4,000.00 higher than Burkes, and the appellants have not directed me to any aspect of the Burkes estimate that comes up short (apart from the mitre edge noted above) in specification, materials, or in the scope of work.

92Accordingly, I find that the appellants are entitled to $7,232.00 in respect of the damages arising from this warranted claim.

Claim Item 71 – HVAC deficiencies – bedroom three

93I find this claim constitutes a breach of warranty, i.e. it is a warrantable claim.

94Mr. Rahman testified that within one week of taking possession of their home on December 15, 2021, the appellants reported that bedroom three, on the second floor, north-east corner of the home, was colder than the other bedrooms.

95The appellants described this defect on the 30-day claim form (February 3, 2022) as bedroom three being “supercold” and the vent doesn’t bring any air flow. It noted that the builder’s proposed solution, keeping the bedroom door open, was completely unsatisfactory.

96Mr. Rahman described the exchange between the appellants and Tarion on this claim item over the following year which culminated in Tarion assessing the complaint as warranted on January 23, 2023.

97Mr. Rahman testified that he holds a master’s degree in civil engineering and has more than 25 years experience in the field including engineering consulting on highway systems, for petroleum companies, and most recently with the National Research Council on flood mitigation measures.

98Mr. Rahman conducted his own measurements of airflow (at the registers) and interior temperature readings in bedroom three in February 2025 and testified that bedroom three was not getting enough airflow or heat from the HVAC-furnace system. For example, with the thermostat on the main floor set at 22°C, on a day that was -20° outside, the temperature in bedroom 3 registered only 17° (with the bedroom door closed). He presented evidence that on that day it took approximately two hours, with the main floor thermostat increased from 22° to 25°, to bring the inside temperature of bedroom three up to 18.5° C.

99He reviewed the HVAC design for the home by Martino HVAC Design and directed me to discrepancies between the Martino design assumptions/specifications and the actual built home and installed HVAC system. He concluded that these discrepancies account for why bedroom three is colder than the other rooms:

1. The heat-loss in the building is more than the Martino plan expected due to:

(a) the Martino plan assuming an eight-foot ceiling in the basement, and the built home has a nine-foot ceiling; and

(b) there are more windows, and some larger windows in the built home than the Martino design accounted for;

2. The Martino design shows two heat ducts/registers in bedrooms two, three and four, and in the main floor office, yet these four rooms have only one heat duct and register; and

3. The Martino design specified a furnace with 57,000 BTU/H output capacity but the currently installed furnace has only a 43,000 BTU/H output capacity.

100Mr. Rahman referred me to section 9.33.3.1 of the OBC which requires that heating systems, at the outside winter design temperature (reported to be -25° for this date and location), be capable of maintaining an indoor air temperature of not less than 22° in all living spaces. He testified that the inside temperature in bedroom three is routinely up to five degrees below the thermostat setting in the home which, he asserts, is a clear violation of the OBC. He also directed me to section 8.9 of the Tarion Construction Performance Guidelines (“CPG”) which reflects the same OBC requirement (that heating systems be capable of maintaining an indoor temperature of 22° in living spaces).

101Mr. Rahman testified that the heating system in the home is undersized for the home’s actual heat loss and lacks enough ducts to get sufficient warm air to bedroom three, and other rooms.

102Mr. Rahman testified that the HVAC report of Keller Engineering, dated January 10, 2025 (“Keller Report”), on which Tarion determined this claim to be “not warranted”, is unreliable and should not be given any weight because the airflow readings were unscientific (putting a sheet of paper against a register), they state that only the accessible building elements in the home could be reviewed, and the temperature measurements in bedroom three were taken with the interior bedroom door open.

103The appellants seek an order from the Tribunal to fully implement the Martino HVAC design in the home including an upgraded furnace (to the higher output one specified), additional ducts/registers in the four rooms noted, including the necessary openings, refinishing of walls and ceilings to accomplish the work, testing the new HVAC system, and accommodation for the family while the renovations are being conducted.

104The appellants did not propose a value or amount for the damages arising from this warranted claim. They submit that the cost of the project be compensated by Tarion based on the quotation of an experienced, independent professional contractor who has “never worked with the builder, Richcraft Homes Ltd.”

105Tarion does not dispute that bedroom three is not being heated as well as the other rooms in the home. It arranged that a thermal imaging inspection be conducted in December 2023 (by UBS), and an HVAC inspection be conducted in December 2024 which resulted in the Keller Report.

106However, based on the findings of the Keller Report Tarion determined the claim to be not warranted. Accordingly, Tarion did not propose compensation relating to the damages associated with this reported defect.

107Chris O’Brien, mechanical engineer, at Keller Engineering, testified that 75% of the consulting he undertakes at Keller is with HVAC and plumbing issues. He testified that he conducted a review of the home and HVAC designs and noted that there were differences in the built home of the appellants’ compared to the design on which the heat-loss calculations were made for the Martino HVAC design. For example, the appellants have a 4-bedroom design versus the 3-bedroom configuration of the same model that the heat-loss was predicated on. He testified that although there were modest changes, they were not significant enough to require a higher output furnace.

108Mr. O’Brien testified that a cold room is usually not the fault of the furnace. It is usually an issue with the integrity of the building envelope, i.e. inadequate insulation, sealing etc. He testified that bedroom three is not getting enough airflow to keep up with its heat loss. Bedroom three is located on a north-east corner of the home and has a sizable window at the corner that does not provide the same level of insulation as the exterior wall assembly.

109Mr. O’Brien testified that the installed Lennox furnace is suitably sized for this home. It matches the heat-loss requirements of the home. He added that a higher output furnace would not necessarily solve the issue in bedroom three because a higher airflow and higher output (in BTU/H) furnace could mean the furnace would run less time in reaching the desired temperature at the thermostat. Moreover, he testified that the higher output, 57,000 BTU/H, furnace specified in the Martino design would not be compliant with the requirements of Canadian Standards Association CSA-F280, which stipulates that a furnace cannot be more than 40% greater than the required heating capacity for a building.

110On the OBC requirement that the heating system be able to maintain 22° in the home’s living spaces, Mr. O’Brien testified that this does not mean the whole home must meet 22° when the system is set to achieve that temperature. It means that the system must be “capable” of maintaining that temperature in all occupied spaces of the home. He added that they tested the HVAC system’s capability with the bedroom three door open.

111James Seguin, consulting engineer with Keller Engineering, testified that he and an associate attended the home in December 2024 and he authored the Keller Report. He stated that he is a specialist in assessing the building envelope in matters such as this one.

112The Keller Report confirmed, with thermal imaging, that the second-floor north-east corner (at bedroom three) has a cold spot below the window. Aside from the cold spot, the Keller Report recorded no deficiencies in the building envelope or the functioning and integrity of the HVAC system.

113The Keller Report notes that upon the investigators’ arrival the thermostat on the main floor was set at 22.5°. It was -2° outside. The temperature in bedroom three was 17.5°. The thermostat was increased to 25° for the remainder of the investigation. The Keller Report reported the resulting inside temperatures as:

Room	Location	Temperature °C
Bedroom 3	Centre of Room	19.5
Bedroom 3	Heat at register	30.5
Bedroom 4	Heat at register	30.4
Upper Hallway	Heat at register	32.2
Bedroom 2	Heat at register	37.6
Bedroom 2 Ensuite	Heat at register	38.4
Master Bedroom	Heat at register 1 by hallway	40.1
Master Bedroom	Heat at register 2 by the window	37.2

114The Keller Report also notes that bedroom three is the room with the longest run from the furnace. It stated that the longer the run of venting is, the more the airflow slows due to friction.

115I find the defect in relation to the bedroom three is warranted.

116I am not persuaded by the appellants’ argument that a complete reinstallation of the HVAC system, per the Martino design, must be undertaken because their proposal involves much more than addressing the defect in bedroom three (more ducts and vents to three other rooms in the home) and switching out the existing furnace to a higher capacity one would be non-compliant, i.e. more than 40% higher than the design heat-loss of the home, with CSA Standards. While the appellants have met their burden of proving that the defect is warranted, they have not presented me with the amount of damages incurred from this warranted claim item, i.e. the amount of labour and materials to remedy the deficiencies.

117I give weight to the Keller Report because the paper review and physical inspection of the home were conducted by qualified, HVAC engineers and consultants.

118Despite their inspection and finding that the HVAC system is properly sized and there appears to be no defects (improper openings or gaps, blockage, furnace function), even with the bedroom door open, the inside temperature of bedroom three only reached 19.5° during the inspection (with the thermostat set at 25° and the outside temperature at -2°, well above the -25° reference temperature at time and location). As the appellants noted in their evidence, when the main thermostat was set at a comfortable temperature of 22.5°, bedroom three only reached 17.5°.

119The evidence before me suggests, and the Keller Report confirms, that the heating system is not producing enough airflow into bedroom three to meet its actual heat loss. It was nearly 3° below the OBC requirement during the Keller inspection, even with the bedroom door open. I agree with the appellants, that this is not acceptable in a new home.

120The evidence reveals that there is not enough airflow from the HVAC system to neutralize the greater heat loss in bedroom three.

121The chart above shows the system is putting significantly more heat to the registers in every room except bedrooms three and four. The discussion in the Keller Report provides considerable detail on the necessity of balancing the airflow of the heating system. It described the use of “balancing flaps/dampers” installed inside every heating vent/duct, to adjust and balance the airflow to various parts of the home. It noted that “fine tuning may be required to achieve the desired results”. The damper to bedroom three was reported to be Open, as was the damper to bedroom four.

122Considering that the system seems to be capable to reaching the OBC objective, except in bedroom three, it seems that the system needs more fine tuning and balancing so that more airflow will get to bedroom three during the heating season. The Keller Report notes that some of the in-vent dampers to other areas of the home are slightly open and some are mostly closed. It is not clear how the dampers were observed since the evidence reveals that at least some of the damper controls are now enclosed and inaccessible.

123In addition to the airflow balancing issue, the Keller Report raises the possibility that an installed bypass humidifier and/or a high MERV (Minimum Efficiency Reporting Value) rating filter could be negatively affecting the system’s ability to deliver enough airflow.

124These factors suggest further investigation is required to propose a solution that will have more airflow running to bedroom three during the heating season and reach the OBC objective of maintaining a 22° inside temperature.

125Accordingly, I find, on a balance of probabilities, that claim item 71 is warranted.

126Since the appellants’ proposal to remedy the HVAC defect is beyond the warranted defect in bedroom three, and they have not proposed the amount of damages necessary to complete repairs to this defect, I make no determination about the amount of the damages for claim item 71.

127Since more investigation of the HVAC deficiencies relating to bedroom three is required, Tarion is directed to reopen this claim and return it to the conciliation process under the Act and s. 4.2 of the Regulation, including to undertake further investigations and inspections of the warranted defect and to issue an updated conciliation assessment report. Pursuant to section 5.1.1(5) of the Regulation, the builder will have 30 days from the date the updated conciliation assessment report is issued to complete necessary repairs, pay compensation or otherwise resolve the claim item in accordance with the Act and the regulations. If the builder fails to resolve the warranted claim in that time period, Tarion shall, pursuant to section 5.1.1(6), pay compensation out of the Fund or otherwise resolve the warranted claim item in accordance with the Act and regulations. If the appellants disagree with Tarion’s decision in respect to the resolution of the claim, the appellants may request a decision letter pursuant to section 14(13) of the Act.

Conclusions

128The appellants are entitled to $12,718.15 in compensation in respect of claim items 14, 25, 27, 58, 60 and 107.

129Claim item 71 is warranted.

130Tarion shall reopen claim item 71 and resume the warranty conciliation process for it pursuant to the Act and regulations.

ORDER

131Pursuant to section 14(19) of the Act, I order the following:

1. Tarion is directed to pay the appellants $12,718.15 from the Fund in respect to claim items 14, 25, 27, 58, 60 and 107.

2. Tarion is directed to reinstate claim item 71 as warranted and resume the warranty conciliation process of it, pursuant to the Act and regulations, including:

i. to undertake further investigations and inspections of the warranted defect and to issue an updated conciliation assessment report;

ii. pursuant to section 5.1.1(5) of the Regulation, the builder will have 30 days from the date the updated conciliation assessment report is issued to complete necessary repairs, pay compensation or otherwise resolve the claim item in accordance with the Act and the regulations;

iii. if the builder fails to resolve the warranted claim in that time, Tarion shall, pursuant to section 5.1.1(6), pay compensation out of the Fund or otherwise resolve the warranted claim item in accordance with the Act and regulations; and

iv. if the appellants disagree with Tarion’s decision in respect to the resolution of the claim, the appellants may request a decision letter pursuant to section 14(13) of the Act.