Troubling precedent for your pre-build clients

by Olivia D'Orazio13 Apr 2015
A court decision coming last month could see some of your clients forfeit their rights as homeowners, making it less attractive for them to sell their property.
An appeal case brought before the Ontario Divisional Court in March was eventually lost when a homeowner (the appellant) learned that her claim against the homebuilder’s warranty became null and void once she sold the property.
“The Tribunal held that when the appellant sold her condominium on October 15, 2013, she lost standing to continue her appeal against Tarion,” the Tribunal wrote in its decision. “The Tribunal held that because of s.13(6), the appellant could not contract out of the statutory warranties through an assignment.”
The appellant originally complained of a heating issue to Tarion, which later sent a Tarion Warranty Services rep to inspect that unit and the eight others in the townhouse complex. It was the determined that duct modification needed to take place, beginning with a pilot project involving one unit.
However, the appellant installed a gas fireplace without Tarion’s approval, then submitted a claim to Tarion in an effort to recover the $17,000 cost of the fireplace. That claim was denied once Tarion discovered that the appellant sold the property.
The appellant decided to appeal the decision based on the fact that she had in place a collateral agreement with the purchaser of her property, which she believed enabled her to continue her claim against Tarion.
You can read the full tribunal decision here.




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