Ontario Condo Law Blog : Toronto Condominium Lawyer & Attorney : Gardiner Miller Arnold Law Firm : Ontario, Ottawa, Hamilton, Kitchener

Compared to our American neighbours, Canadian courts play host to relatively few class action lawsuits. Class actions involving condominiums are quite rare.  Even rarer are class action suits that actually generate significant cash returns to condominiums but, as they say, there is a first time for everything.

In 2008, Toronto Community Housing Corporation (TCHC) commenced a class action lawsuit against ThyssenKrupp Elevator over the cost of replacing faulty sheave jammers installed during or before 2006. A sheave jammer is a secondary braking device designed to stop the movement of an elevator in the event the primary control and braking systems do not operate effectively. 

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One of our readers asks us:

Q: Our condo board recently requested a conciliation meeting with Tarion. We are still in the "pre-conciliation repair period." At what point should something be stated on our status certificates?

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The sheer volume of new condos currently under construction in the Greater Toronto Area means that we at the Ontario Condo Law Blog will be keeping busy for a long time to come.  It also means that a new generation of condominiums, boards and unit owners will soon begin the inevitable dance with developers over construction deficiencies.  

One of the easiest and most costly mistakes the board of a new condominium can make is to lose the right to sue the developer for construction deficiencies by waiting too long.   Although the limitations law in Ontario was changed 10 years ago, too many people still don’t know that claims arising after January 1, 2004 must be pursued with a lawsuit within 2 years of discovering the claim.  Condominium boards fall into that trap routinely, as illustrated by a recent Ontario Superior Court case against a condo developer over construction deficiencies in the common elements.

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As the second part of our series of posts on new home warranty claims by condo corporations, we discuss why condos are better off seeking proper legal advice before making warranty claims for construction deficiencies.

Dealing with construction deficiencies is one of the largest and most critical tasks that the board of any new condominium must face in the first few years. It is therefore surprising to find that when it comes to dealing with construction deficiencies in the common elements of new condominiums, most condo boards simply start and follow the claims process under the Ontario New Home Warranty Plan (“Tarion”), a program that is notoriously ineffective, unresponsive and unsatisfactory when it comes to so many common issues faced by new condominiums.

Even more surprising is that condo boards often embark on the Tarion claims process without first asking the corporation’s lawyer to outline the pros and cons of proceeding with a claim to Tarion rather than commencing a lawsuit in court to recover damages for construction deficiencies. In fact, many corporations pursue much of the Tarion warranty claims process without the help of a lawyer at all, simply because it is not mandatory to use a lawyer for such cases.

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In addition to heat waves and holidays, this July brings important changes to coverage for new condominium projects under the Ontario New Home Warranty Plan, better known as Tarion. There is also news that additional changes to the warranty plan are being considered.

In this entry, we will cover new regulations now in force that affect the Tarion warranty. In a separate entry, we will discuss why condo corporations need to make better use of their lawyers when it comes to dealing with construction deficiency issues.

For the hat trick, our third entry on new home warranty coverage will feature Tarion’s call for submissions to their public consultation about the major structural defect warranty. Anyone wishing to get started on this topic now can get the details here. An August 12 deadline for submissions is looming.

Let’s start with the new regulations that are effective immediately.

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In his regular real estate column in the Toronto Star, lawyer Bob Aaron recently reminded condo buyers to carefully review status certificates and watch out for certain common situations where the facts stated on the status certificate issued by the condominium corporation may not match reality.

One of those frequent pesky issues is parking and locker units that are numbered differently than their legal description. Mr. Aaron’s example is a parking unit marked in paint as number 99 but which is legally described on the deed as “Unit 53, Level A.”

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Toronto lawyer and Tarion director Bob Aaron says that toxic Chinese drywall "may become the biggest environmental crisis to hit North American homeowners and builders in decades."

The defective drywall is decidedly carcinogenic and may be radioactive. This product emits noxious sulfuric gases that can damage HVAC components and corrode electrical wiring inside of walls. Not surprisingly, these gases pose a serious threat to human health and can render affected homes uninhabitable. Any home owner or condominium corporation faced with Chinese drywall in their home or building faces a daunting challenge and must consult quickly with engineering, health and legal experts.

Thankfully, relatively little of this defective product was imported into Canada and only a tiny portion may have found its way to Ontario. No significant cases have yet been reported in Ontario.

In contrast, the problem is quite widespread in the Southern U.S. and has spread north, generating a large-scale response by lawmakers, consumer protection watchdogs and construction litigation attorneys. Protective laws are being passed and multiple class action lawsuits are already underway.

Considerable information on the topic is available in the blogosphere, particularly by American construction law attorneys. An entire section is devoted to Chinese drywall at The Construction Litigation Blog of Stark & Stark in New Jersey and a Chinese Drywall Blog was recently launched by Wolfe Law Group of Louisiana and Washington states. Both are good resources.

We'll be watching for local developments. Post a comment below with any news or tips you may have.

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The newly-transformed Art Gallery of Ontario opens its doors this weekend.   The Globe and Mail reports that the final ($276 million) product has met with the approval of its designer and world-famous architect, Frank Gehry, although he would make a few changes if more money was available.

At about this time a year ago, the famous architect and his firm were named as defendants in a lawsuit for alleged defects in a new building commissioned by the Massachusetts Institute of Technology.     The construction company was also sued and the accusations began to fly as to whether the defects were the result of the architecture or the construction. 

In responding to MIT’s lawsuit, Gehry told the New York Times that problems in complex buildings are inevitable, and that:

A building goes together with seven billion pieces of connective tissue. The chances of it getting done ever without something colliding or some misstep are small.

In commenting on that lawsuit and the parties’ response to it, lawyers at Stark & Stark in New Jersey made this observation in their Construction Litigation Law Blog:

It is disconcerting to see that a superstar architect, a global construction company and a world-class institute of higher learning, with $300 Million to spend cannot seem to create a water-tight building. Mr. Gehry seems to think that construction defects are par for the course. In that context, it comes as no surprise that we find problems with much simpler, mass-produced homes and condominiums.

The moral: First-year condo boards in a newly-constructed buildings should budget time and resources with the presumption that there will be defects and deficiencies that need to be addressed.  

Be sure to visit the AGO.

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