Licence Appeal Tribunal
Licence Appeal Tribunal File Number: 16238 ONHWPA
In the matter of an appeal from a decision of Tarion Warranty Corporation under the Ontario New Home Warranties Plan Act, R.S.O., c. O.31, denying a claim
Between:
Sebastiano and Maria Caschetto Appellants
and
Tarion Warranty Corporation Respondent
DECISION
VICE-CHAIR: Avril A. Farlam
APPEARANCES:
For the Appellants: Ayaz Mehdi, Counsel
For the Respondent: Suzanne Chandrakumar, Counsel
HEARD: March 10 and 11, 2025
OVERVIEW
1Sebastiano and Maria Caschetto, the appellants, appeal from the decision letter dated August 23, 2024 (“Decision”) issued by Tarion Warranty Corporation (“Tarion”) which pursuant to s. 14 of the Ontario New Home Warranties Plan Act, R.S.O. 1990, c. O.31 (“Act”) denying the appellants’ claim for warranty compensation on the following item listed on the Year-End form received by Tarion on October 19, 2023:
(1) “ EXTERIOR – Building Face/Exterior – Cladding (Brick, Siding, Stucco, etc.) – Missing stone skirt all around the whole house front only completed. Drawings summitted (sic) to the city show stone all around the house.” (the “Claim”)
2It is common ground between the parties that the appellants purchased 18 Vilnius Lane, Keswick (“Home”) under an agreement of purchase and sale (“APS”) dated April 3, 2021 made between the appellants and Alliance Homes (“Builder”), completed a Pre-Delivery Inspection Form with the Builder dated October 19, 2022 (“PDI”), and submitted a 30-Day Claim Form dated November 29, 2022, and the Year End form dated October 19, 2023.
3The appellants submitted the Claim at issue in this hearing for the first time on the Year End form.
ISSUES
4The issues to be decided are:
i. Whether the alleged defect set out in the Decision constitutes a breach of warranty under s. 14(3) of the Act, and
ii. If so, whether the appellants suffered any monetary damage resulting from the breach of warranty; and
iii. If so, the amount of the damages.
RESULT
5Having considered all of the evidence, and for the reasons that follow, I find that the appellants failed to demonstrate a breach of warranty and I direct Tarion to deny the appellants’ claim.
ANALYSIS
The Statutory Warranty
6Section 13(1)(a) of the Act provides that the vendor of a home warrants to the owner that the home is constructed in a workmanlike manner and is free from defects in material, is fit for habitation and is constructed in accordance with the Ontario Building Code.
7Although the Act is consumer protection legislation and should be given a liberal interpretation, the onus is on the appellants to prove, on a balance of probabilities, that the defects in the home fall within the warranty coverage, that damages have resulted from the defects and the amount of those damages. The Tribunal owes no deference to Tarion’s decision.
8Following a hearing, the Tribunal may, pursuant to s. 14(19) of the Act, order Tarion to take such action as the Tribunal considers Tarion ought to take in accordance with the Act and the regulations, and for such purposes the Tribunal may substitute its opinion for that of Tarion.
Stone Skirt Around the Entire Perimeter Not in the APS
9It is clear from the evidence that the APS did not provide for a stone skirt all around the Home for the following reasons.
10The APS does not require the Builder to construct a stone skirt all around the whole house. The Home is described in the APS as “Type: Raines W/Loft 2369 sqft – Elevation “A”.” The APS expressly states that “this Offer, together with Tarion Statement of Critical Dates & Tarion Addendum to Agreement of Purchase and Sale Schedules X,C,C-1,E,A,A-1,W/1SHEETS, when accepted, shall constitute the entire Agreement…” between the Builder and the appellants. The appellants signed the APS on March 31, 2021 and it was accepted by the Builder on April 3, 2021. Nothing in the APS or the Schedules attached to it support the appellants’ position that the Builder agreed to or was obligated to install a stone skirt all around the Home.
11The Builder’s sales brochure filed by the appellants does not support the appellants’ claim that they were to receive a stone skirt all around the whole house. Although the appellant Sebastiano Caschetto testified that he can see on the Builder’s sales brochure that he said was attached to the listing agreement a stone veneer all across the house and thought that this is what he was buying, the sales brochure filed by the appellants shows only an artist’s rendering of the front and a partially obscured portion of one side of this type of home. There are no dimensions or measurements shown for the stone skirting, or any words indicating it extends around the whole house. Further, the sales brochure expressly states that “Specifications and dimensions correct at press time and are subject to change without notice. Artist’s conception E & O.E. 2015”. As a result, the artist’s concept is not part of the APS.
12Correspondence between the appellants and Builder during the build shows that the appellants were aware during the build that they would not be getting a stone skirt all around the whole house and did not dispute this. Mr. Caschetto testified that he learned that the stone veneer was only on the front of the Home in August, 2022 when he went to the building site and found a copy of the Builder’s blueprints there. Mr. Caschetto emailed the Builder asking why the stone had been “removed” from the contract. Mr. Caschetto received an email back on August 12, 2022 from the Builder’s employee Robert (“Bobby”) Troop confirming that the appellants have not received the stone skirt around their whole house as that is not a standard feature for these homes and “It was not in your contract to be removed.” Mr. Caschetto wrote back “…I just wanted to get an explanation. It is a little confusing they way it is stated on the contract. I understand now thank you.” Taken together with an email sent to the appellants in April, 2021 providing them with a price to upgrade the house to “…all brick with a stone skirt at the front”, I find that the appellants knew they had agreed to a stone skirt at the front of the Home only, and that the APS did not obligate the Builder to provide stone skirt all around the whole house and the appellants completed the purchase of the Home on this basis.
13The appellants completed the purchase of the Home and did not put the Claim on their Pre-Delivery Inspection form or their 30-Day claim form at a time when the appellants could clearly see that the stone skirt was only on the front of the Home. It was raised for the first time on the One-Year form, tending to indicate that the appellants decided to raise this Claim for the first time some months after completing the purchase and taking occupancy of the Home.
14I do not find Mr. Caschetto’s testimony that the Builder was to install a stone skirt all around the Home credible or reliable when I consider it with the other evidence before me. The express provisions of the APS do not provide for a stone skirt all around the home, its dimensions or detail. The August, 2022 email Mr. Caschetto sent during the build confirms that he understood the stone skirt all around the home was not a standard feature. The appellants completed the purchase of the Home at a time when they could see the stone skirt was only installed at the front of the house, and did not put the “missing stone skirt” on either the PDI form or the 30 day form.
15The appellants called as a witness Johnny Grandinetti, an experienced operations manager for another home construction company. Mr. Grandinetti testified that he asked the appellants to get a copy of the building permit and the drawings that the Builder gave to the municipality. After reviewing this material and the APS documents, Mr. Grandinetti testified that at the company where he works, they believe they are obligated to build what is on the plans filed with the municipality. Mr. Grandinetti testified that the plans for this Home show stone veneer all around the whole house and his view is that the Builder was obligated to install this. I give the testimony of Mr. Grandinetti on this point no weight. There is no evidence before me that Mr. Grandinetti was present or involved in any way at the time the APS was negotiated and signed, or during the email exchange between the appellants and the Builder in August, 2022. Mr. Grandinetti’s information about how his employer forms contracts with customers is not relevant to the APS made between the appellants and their builder, and his opinion cannot import any terms into the APS after it was made.
16I prefer the evidence of Jonathan Franco, Tarion Senior Warranty Services Representative and Bobby Troop, the Builder’s project manager, both of whom are familiar with the APS and its terms.
17Mr. Franco confirmed that the Builder’s warranty starts on the possession of the Home, with the PDI. He reviewed the APS and found that it does not require a stone skirt around the whole house. The appellants did sign an “Exterior Colour Package #6” for the Home in which they only selected the colour of the “stone skirt” but not the type of stone or the dimensions or where it would be installed. Mr. Franco also testified that the drawings submitted to the municipality’s building department did not form part of the APS, contained no signatures of the appellants, and were not part of their APS package. Cladding would not affect the structure of the Home. Although the APS does refer to a dwelling to be constructed in accordance with “…plans and specifications already examined by the Purchaser”, Mr. Franco testified that the appellants were not given plans, did not initial plans, and they were not attached to the APS and did not form part of the APS.
18Bobby Troop is the Builder’s project manager and takes care of after service. His duties include obtaining permits, pricing, budgets, among other functions. Mr. Troop testified that he is familiar with the APS and confirmed that it does not state anywhere that there would be a stone skirt all around the house and, to his knowledge, there were no representations made to that effect to the appellants. Mr. Troop said the appellant’s Exterior Colour Package is part of the APS and requires the appellants to choose the colour of the stone skirt because this is on the front of the Home.
19Mr. Troop explained that the drawings and architectural specifications are submitted to the municipality for structural review and to ensure compliance with the Ontario Building Code, not for approval of aesthetic details or finishes. For example, the gable end could be shakes, or horizontal or vertical siding, and the drawings show an optional “man garage door”. The plans are used for more than one home and finishes can vary. Otherwise, the Builder would have to have revised plans from its architects every time a finish is varied and this would be an expense and take time. After construction of the Home, the municipality issued an occupancy permit.
20Mr. Troop testified that when the appellants inquired about getting stone around the whole house, the email was sent to them by Mr. Troop on August 12, 2022 confirming they were not getting this. The foundation on the building plans can accept a stone skirt with appropriate flashing but it is not required. Mr. Troop confirmed that his email to the appellants reminds them that “The blacklines that you signed off on make up your contract”. By this, he was referring to the part of the APS containing the part of the sales brochure showing the plans which was signed by the appellants.
21Mr. Troop also said the APS refers to upgrades and states that on closing if upgrades are incomplete on closing, the Builder will refund the cost of the upgrade. The appellants did not purchase any upgrades although upgrade was discussed.
22Taking all of the evidence into consideration, I find that the appellants have not established that the Builder was contractually obligated to provide stone skirt all around the whole house, and no Builder warranty is required for an item not required by the APS. The fact that the Builder provided plans to the municipality for building permit does not make those plans part of the APS. Tarion back stops the Builder’s warranty, if one exists. If a Builder’s warranty does not exist, there is no warranty claim to be back stopped by Tarion as I have found here.
Damages
23Having found that there is no breach of warranty established before me, it is not necessary to consider whether the appellants suffered any monetary damage resulting from the breach of warranty; and if so, the amount of damages.
No Water Penetration Issue to be Determined in this Hearing
24The appellants Year End Claim is for “missing stone skirt all around the whole house”, which I have found has not been established to be a warrantable item.
25Some of the evidence of all witnesses including Taylor Porter, Tarion’s engineer addressed the appellants’ contention that the lack of stone skirt all around the whole house has given rise to a water penetration problem in the area of the corner of the window at the foundation wall.
26Water penetration is not part of the Claim before me. It is not raised in Item (1) in the appellants’ Year End Claim. The evidence was that it was raised verbally by the appellants as part of the conciliation process.
27The appellants were advised by Tarion in the Decision to submit this on their next warranty form. As a result, it is not before me and I make no determination of that issue.
Conclusion
28I find that the appellants have failed to demonstrate a breach of warranty with respect to the Claim.
ORDER
29For the reasons set out above and pursuant to s. 14(19) of the Act, I direct Tarion to deny the appellants’ claim.
Released: May 14, 2025
LICENCE APPEAL TRIBUNAL
Avril A. Farlam Vice-Chair```