Toronto Star runs home inspection article.

[Nick Gromicko]

http://www.thestar.com/Athome/article/214758

[rwand1]

Unbelievable!

[Marcel R. Cyr]

Unbelievable is an understatement Raymond.

Are the Laws out there to protect the Builders or what? What is the problem with the Builders Ethics in providing a finished product, Building permits and CO's before closing. Go figure.

Marcel
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[Mario A. Kyriacou, CHI]

Originally Posted by mcyr

Unbelievable is an understatement Raymond.

Are the Laws out there to protect the Builders or what? What is the problem with the Builders Ethics in providing a finished product, Building permits and CO's before closing. Go figure.

Marcel
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Marcel

This guy was more than likely a small builder this is not common practice with the bigger and better builders.
Bottom line Ray is correct this is unbelievable. This should not be happening period.
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[phinsperger]

In July 2004, they signed an agreement to buy a new house from a builder for $345,500. A $5,000 deposit was paid to a local real estate agent, and closing was scheduled for Aug. 19, 2004.

"The lesson to be learned from the MacPherson case is that buyers of new homes should always insert a clause in their purchase agreement requiring all building permits to be signed off on or before closing. Most builders have a clause in their purchase agreements requiring buyers to close whether or not the permits have been signed off."

Sounds like the realator just pushed the paperwork though without making sure the contract was in the best interest of their client.

[Vern Mitchinson]

Last year I did an inspection on a new home and my client took my report to city hall and the code inspectors went back to the house and removed all the approval stickers. Go figure.
The neighbour next door with the same builder advised my client not to take possision until the house was complete. She made that mistake and can not get the builder back to complete the house.

[Christian F. Mettel]

At the same time, the Tarion Warranty Corp. and the Licence Appeal Tribunal tell buyers like the MacPhersons they have to move into an unfinished home or risk losing their deposits.
Something is wrong with this picture.

Something is defininately wrong when the private corporation (Tarion)that has been set up to protect homebuyers insists that they move into a house that has not been signed off as being safe. How can they (and the LAT) not deem that there has been a fundamental breach of contract if the house was not ready at the time of closing? Unconscionable in my opinion.

Chris

[Bill Mullen]

Originally Posted by cmettel

At the same time, the Tarion Warranty Corp. and the Licence Appeal Tribunal tell buyers like the MacPhersons they have to move into an unfinished home or risk losing their deposits.
Something is wrong with this picture.

Something is defininately wrong when the private corporation (Tarion)that has been set up to protect homebuyers insists that they move into a house that has not been signed off as being safe. How can they (and the LAT) not deem that there has been a fundamental breach of contract if the house was not ready at the time of closing? Unconscionable in my opinion.

Chris

The big thing we need to keep in mind is that Tarion is a Warranty Program, or basically an Insurance Company set up by Home Builders and operated primarily by Home Builders. Their history has proven that they will usually use their resources not to protect the home buyer, but to discourage the unhappy buyer at every turn.

Like any good insurance firm, the fewer payouts they have to make, the better their bottom line looks.

If anyone truly believes that Tarion is on the side of buyers, I have some swamp land I'd be happy to sell you.

Bill Mullen
Sarnia, ON

[Yuri Olhovsky]

Originally Posted by bmullen1

The big thing we need to keep in mind is that Tarion is ... set up by Home Builders and operated primarily by Home Builders.
Bill Mullen
Sarnia, ON

True. They are only called "New Home Buyers" organization. In fact - it is builders organization that protects builders interests.

[rwand1]

The Ombudsman of Ontario has previously had some damaging things to say about Tarion, as have the courts, who have overturned Tarion decisions.

[rwand1]

From

http://www.nachi.org/forum/f48/canadians-properly-built-homes-cpbh-new-home-warranty-13551/

Post # 3



Warranty does not eliminate client's rights

Primary purpose of Tarion is to administer Ontario New Home Warranties Plan

February 17, 2007

Bob Aaron, The Toronto Star

In the summer of 1999, Brian Griffin bought a new house to be built by T
& R Brown Construction Ltd. in the City of Kawartha Lakes.

In March and August of the following year after taking possession,
Griffin became unhappy with defects in the house and served notice on
what is now the Tarion warranty program of a breach of warranty under
the legislation. A conciliation was conducted at the house in August,
2000 and some repairs were made. The warranty program did several
re-inspections and then issued a formal report to the owner.

Griffin was still not satisfied and filed a further claim listing 33
separate complaints. After the program responded to the complaints,
Griffin launched a formal appeal of the decision. The Licence Appeal
Tribunal scheduled five days for hearing the appeal, but a few days
before the hearing, Griffin abandoned it and decided to sue the builder
and the City of Kawartha Lakes instead.

In November, 2006, Brown and the city asked the court to terminate
Griffin's lawsuit as "frivolous and vexatious." They argued that Griffin
could not sue because he was obliged to accept the decision of the
warranty program in place of any right to collect damages in a civil court.

Section 17 of the Ontario New Home Warranties Plan Act says that every
contract to buy a new home is deemed to contain an agreement to submit
future differences to arbitration. At first blush, it looks like this
provision eliminates the right of any homeowner to sue under the terms
of the contract.

At the court hearing on the application to kill the litigation,
Griffin's counsel, William F. Kelly, argued that his client's rights
under the contract with the builder are not eliminated by the provisions
of the warranty program legislation, which is designed to protect the
rights of new homebuyers and not truncate them.

Justice Robert A. Clark dismissed the application to toss out Griffin's
case without a trial. His view was that the legislation contains no
express prohibition against a lawsuit. As a result, he ruled, the
jurisdiction of the Licence Appeal Tribunal to decide warranty appeals
exists alongside that of the courts, and a homeowner can choose which
route to take.

The builder and the city argued that the issue of whether the builder
had breached any of the statutory warranties had already been decided by
the warranty program, and it would be improper for the owner to litigate
the issue all over again in a courtroom. Justice Clark dismissed this
argument as well.

Notices of appeal have been filed by Brown and the city.

In this column last week, I quoted from a decision of the Ontario
Divisional Court, which ruled last year that the law governing the
Tarion program is "consumer protection legislation and should be given
broad and liberal interpretation."

This ruling, in the Keith Markey case, was a bold step forward since
neither the Ontario New Home Warranties Plan Act nor the regulations
passed under it contain any specific statement to that effect. The
legislation itself simply states that the primary purpose of the Tarion
Warranty Corp. is to administer the Ontario New Home Warranties Plan.

Following the ruling of the Divisional Court in the Markey case,
everything that Tarion does will now have to be re-examined in light of
Tarion's clarified mandate to protect consumers.

Tarion is an independent, self-governing, arm's-length organization
created by the Ontario government. Its annual report states: "Tarion's
mandate is unique in Canada. No other province or territory so
completely transfers responsibility and liability for management of the
home building industry to an independent organization."

Soon that mandate may be subject to further oversight – this time by the
Ombudsman of Ontario.

Karen Somerville is president of Canadians For Properly Built Homes
(CPBH), an Ottawa-based group that speaks for homeowners across the
country. Last month, Government Services Minister Gerry Phillips advised
Somerville that he is considering having the mandate of the ombudsman
extended to include the Tarion warranty program.

That would certainly be good news for people like Brian Griffin and
other buyers of new homes and condominiums in Ontario. Having the
ombudsman investigate a case would no doubt be faster and cheaper than
pursuing a claim for defects in the province's courtrooms – or even
before the Licence Appeal Tribunal.

Somerville told me that many homeowners have advised CPBH that the
option of appealing Tarion's decisions to the Licence Appeal Tribunal
(LAT) is not one that they are interested in pursuing – for a number of
reasons.

These reasons include: the relatively low success rates of those who
have taken their cases to the LAT, and the need to retain the services
of a lawyer (with no guarantee of success), given that the builder and
Tarion are usually represented by a lawyer at the LAT.

My guess is Brian Griffin chose to abandon the tribunal appeal because
he would have had to pay his lawyer for a five-day hearing, and might
not be any further ahead at the end of it.

In recent months, Ontario ombudsman André Marin began investigations
into the Ontario Lottery and Gaming Corp., the Municipal Property
Assessment Corp., and the denial of certain out-of-country benefits by
the Ministry of Health and Long-Term Care.

Buyers of new homes in Ontario will benefit considerably if minister
Gerry Phillips expands the ombudsman's mandate to include oversight of
the Tarion warranty corporation. In my view, he can't do it soon enough.

------------------------------------------------------------------------
Bob Aaron is a Toronto real estate lawyer. He can be reached by email
at bob@aaron.ca, phone 416-364-9366 or fax 416-364-3818.