Licence Appeal Tribunal File Number: 16824/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. 1990, c.O.31 to Deny a Claim for Compensation

Between:

Mohammed Muneeruddin

Appellant

and

Tarion Warranty Corporation

Respondent

DECISION

ADJUDICATOR:

Michael Beauchesne

APPEARANCES:

For the Appellant:

Mohammed Muneeruddin, Self-Represented

For the Respondent:

Ross Corallo, Warranty Services Representative

Ayesha Mehreen, Counsel

Court Reporter:

Elizabeth Pilbrow

HEARD: by videoconference August 11, 2025

OVERVIEW

1Mohammed Muneeruddin (the “appellant”) appeals a decision letter issued by the Tarion Warranty Corporation (the “respondent”) and dated February 19, 2025, under section 14(13) of the Ontario New Home Warranties Plan Act (the “Act”).

2For context, the appellant’s year-end form, dated September 12, 2022, identified that the floor tiles installed in the hallway of the main floor of his home were missing grout. The appellant indicated on the form that this issue had been addressed multiple times, but that the grout would again come off after a couple of weeks.

3The respondent subsequently conducted a conciliation assessment. The assessment report, dated May, 23, 2023, identified the appellant’s concern with the grout joint at the center of the hallway between the kitchen island and the great room. The appellant also expressed concern about chips in the tile at this location, which appeared after grout repairs were completed by the builder. The appellant made the same complaint about tiles in the hallway between the refrigerator and the great room where grout repairs had also been done. In addition, the appellant was concerned about pin holes in the grout joint of the hallway tile near the kitchen patio door.

4The report indicates that at the time of the assessment, the builder confirmed the grout joints at these locations on the main floor had been previously repaired.

5The respondent determined these were all warrantable defects in work and materials. Specifically, the conciliation assessment report notes that the left edge of the third tile from the hardwood floor in the hallway between the kitchen island and the great room was chipped. The right edge of the second tile from the hardwood floor between the refrigerator and the great room was also chipped. And the grout joint of the tile in line with the left patio door jam presented with “minor” pin holes and gouges.

6The respondent’s subsequent claim inspection report, dated December 11, 2023, indicates that both the appellant and the builder agreed that repairs to these warrantable defects had not yet been completed. The letter further indicates that the respondent would proceed to resolve the warranty directly with the appellant via monetary settlement.

7In its decision letter of February 19, 2025, the respondent indicates that the appellant declined to accept its offer of $1,100.00 to resolve the tile and grout issues identified as warrantable in the conciliation assessment report.

ISSUE

8The Tribunal is asked to determine the amount of damages the appellant is entitled to arising from the builder’s breach of warranty.

RESULT

9The respondent shall perform, or arrange for, the performance of work required to cure the items it found warrantable in its decision letter of February 19, 2025, in lieu of paying damages from the guarantee fund.

10The respondent shall arrange for the work to be completed by a contractor other than the builder in the event it does not itself undertake the repair work.

11The work to be performed or arranged by the respondent shall be limited to repairing the defects identified as warrantable in the decision letter of February 19, 2025.

ANALYSIS

12I find the appellant is entitled to have his warrantable damages, as specified in the respondent’s February 2025 decision letter, addressed through work that is performed or arranged by the respondent in lieu of payment out of the guarantee fund.

13Section 14(3)(b) of the Act says an owner of a home (i.e., the appellant in this case) is entitled to receive payment out of the guarantee fund for damages resulting from a breach of warranty if the person has a cause of action against the builder for damages resulting from the breach of warranty. The parties do not dispute the appellant’s cause of action in this matter and agree he is accordingly entitled to payment for warrantable damages.

14Section 14(12) of the Act provides that the Corporation (i.e., the respondent in this matter) may perform or arrange for the performance of any work in lieu of or in mitigation of damages that are claimed.

15Section 14(19) of the Act enables the Tribunal, by order after the hearing, to direct the respondent to take the action the Tribunal considers the respondent ought to take in accordance with this Act and the regulations; and, for the purposes of the order, the Tribunal may substitute its opinion for that of the respondent.

16The appellant submits that the payment proposed by the respondent is insufficient to remedy his damages. He argues that the respondent’s estimate contemplates the same repairs effected by the builder on multiple previous occasions, none of which have proved successful in addressing the problem of grout deterioration and tile movement. The appellant relies on a quote he obtained from Castello Flooring (the “Castello estimate”), dated January 14, 2025, to show that the root problem of the warrantable defects is likely to be inadequate spacing between the tiles (i.e. not enough grout to secure the tiles) and an improperly installed subfloor that causes tiles to move and results in grout joints falling apart. The appellant emphasized throughout the hearing that he wants to have repairs arranged in lieu of receiving payment.

17The respondent argues that the appellant is entitled to payment only for damages directly related to the breach of warranty. The respondent explains that the Castello estimate pertains to re-tiling his entire kitchen, which is disproportionate and outside the scope of warrantable defects identified in the February 2025 decision letter. The respondent maintains that its monetary offer to resolve the appellant’s warranty claim is suitable.

The Castello estimate is disproportionate to the warrantable defects in work and material.

18I find the appellant’s Castello estimate merits less weight because it goes beyond the scope of the warrantable defects identified in the decision letter. The Castello estimate contemplates a redo of the appellant’s kitchen floor, which involves removing the kitchen island and disconnecting its plumbing and electrical services, stripping the existing tile, disposing of debris, reinforcing the floor with screws, and installing new tile at a total cost of $14,500.00. In contrast, the decision letter warranted two hallway tiles that need to be replaced as well as grout repairs at the end of the hallway adjacent the patio door. There is no mention in the decision letter of tile or grout defects in the kitchen proper, and I am satisfied that the extent of the tile and grout defects as described in the decision letter is corroborated by the photo evidence produced by the respondent.

19During the hearing, the appellant acknowledged the kitchen tiles were outside the scope of the conciliation assessment and decision letter. He did so by agreeing, during cross-examination, that he only took issue with the hallway tiles in his year-end form and did not list tile or grout issues in the kitchen. He further testified that the kitchen tile issue surfaced after he completed his year-end report and subsequent to the builder re-grouting the entire main floor (save a bathroom) sometime shortly before the reconciliation assessment.

20I afforded little weight to tile spacing or subfloor deficiencies as the root cause of the warrantable defects. The Castello estimate indicates the subfloor in the kitchen was “found to be unstable and causing tiles to move, resulting grout joints falling apart.” I find this is an unsupported conclusion and there is no mention here of tile spacing contributing to the warrantable defects listed in the decision letter. I was not presented with corroborating evidence that showed the subfloor was, in fact, unstable. The estimator who provided this estimate did not appear as a witness to provide testimony and the appellant did not point to evidence (i.e., a report or photos) of any inspection this person may have performed of the subfloor to make this determination. In fact, the appellant testified that the Castello estimator did not remove tiles to inspect the subfloor, but nevertheless determined it was deficient by applying “pressure tests” that produced tile movement. Without testimony or an inspection report from the Castello employee, I am not satisfied this test proves the subfloor would need to be addressed as a direct contributor to the warrantable damages.

21I therefore do not rely on the Castello estimate of work to be performed as an accurate basis for determining warrantable damages.

22While I do not doubt the appellant’s testimony that there were other contractors he consulted who raised tile spacing as a defect—meaning that there is insufficient grout to hold the tiles together—it remains that the appellant did not arrange for any of these contractors to appear as witnesses to testify to this point, or produce corroborating evidence to support their opinions. Accordingly, I gave this aspect of the appellant’s argument little weight.

23Given the lack of persuasive evidence, I am not satisfied the Castello estimate accurately determines the amount of damages arising from the builder’s breach of warranty as detailed in the decision letter.

The respondent’s estimate is proportionate to the warrantable damages.

24I find the amount of damages to remedy the warrantable items in the decision letter is more accurately estimated in the respondent’s quote. That December 2023 quote estimates a cost of $1,100.00 to repair grout in the kitchen and hallway, as well as replace six chipped tiles. While I recognize the quote appears to contemplate more materials than identified in the decision letter (i.e. two tile replacements versus six), I accept this discrepancy because it favours the appellant. Further, the respondent’s quote is corroborated by two quotes the builder obtained just two months earlier in October 2023 for work comparable to that assessed by the respondent: one from Rockford Tile Contractors for $1,074.28; and one from North York Tile Contractors Ltd. For $1,252.00.

25As such, I agree that the damages the appellant is entitled to receive from the guarantee fund amounts to $1,100.00 as proposed by the respondent.

I direct the respondent to arrange for a contractor, other than the builder, to remedy the warrantable defects, or alternately undertake the repair work itself.

26I find it reasonable that the respondent performs or arranges for the performance of work to repair the warrantable defects in lieu of paying damages from the guarantee fund.

27During the hearing, the appellant lamented that the respondent had accepted the tile work and materials were defective but was not getting it fixed. For the respondent’s part, Mr. Corallo testified that while the respondent is prepared to offer a cash settlement, it does not do the work.

28I disagree. Section 14(12) of the Act gives the respondent the option to “perform or arrange for the performance of any work in lieu of or in mitigation of damages that are claimed.” While I accept the respondent may prefer to simply make a payment from the guarantee fund and leave the appellant accountable to source repairs, it is incorrect, in my view, for the respondent to indicate it does not undertake the work to repair warrantable items. At the very least, the respondent may “arrange for the performance” (i.e., instead of the appellant, the respondent may source the tradespersons) of the work in lieu or in mitigation of damages.

29I find there are case-specific factors that support the respondent’s direct involvement in repairing the defects specified in the decision letter. The appellant testified that the builder attended his home on three separate occasions to address his floor tiling, and that none of these attempts to make repairs—all of which occurred prior to the reconciliation assessment by the appellant’s account—were successful in resolving the problem. The respondent agreed that repair work had been attempted prior to the conciliation assessment. I accept that the tile problems persisted despite the builder’s efforts because the conciliation assessment determined the defects were warrantable.

30Further, the appellant repeatedly testified that his focus is on resolving the tile issue by getting it fixed; he was not looking for the money offered by the respondent as a means of resolving his warrantable items.

31Accordingly, I exercise my discretion afforded at section 14(19) of the Act, through which I may direct the respondent to take the action the Tribunal considers the respondent ought to take in accordance with this Act and the regulations. In doing so, and relying on section 14(12) of the Act, I direct the respondent to perform, or arrange for, the performance of work required to cure the items it found warrantable in its decision letter, in lieu of paying damages from the guarantee fund.

32Owing to the repeated failure of the builder to resolve the warrantable defects, I also order that the respondent, if it does not itself undertake the repair work, shall arrange for the work to be completed by a contractor other than the builder.

33For clarity, the work to be performed shall be limited to that which is reasonably required to fix the warrantable items specified in the decision letter.

ORDER

34The respondent shall perform, or arrange for, the performance of work required to cure the items it found warrantable in its decision letter of February 19, 2025, in lieu of paying damages from the guarantee fund.

35The respondent shall arrange for the work to be completed by a contractor other than the builder in the event it does not itself undertake the repair work.

36The work to be performed or arranged by the respondent shall be limited to repairing the defects identified as warrantable in the decision letter of February 19, 2025.

Released: September 3, 2025

__________________________

Michael Beauchesne

Adjudicator