Is Tarion headed for a shake up ?

Retired judge to probe homebuyer complaints on Tarion

Homeowners group welcomes J. Douglas Cunningham’s review of protections for new home buyers, but Ontario NDP urges reforms sooner, saying “rampant” problems are already known.

Share via Email

Karen Somerville of the advocacy group Canadians for Properly Built Homes maintains that government oversight of Tarion is long overdue.
By: Rob Ferguson Queen’s Park Bureau, Published on Thu Nov 05 2015

Tarion Warranty Corp., the company behind Ontario’s oft-criticized new home and condo warranty program, appears headed for a shakeup.
The provincial government has announced a review of consumer protections for owners of new homes in the wake of concerns about the non-profit firm.
While Tarion is “righting the ship” after making improvements, Consumer Services Minister David Orazietti said Thursday he is appointing former associate chief justice J. Douglas Cunningham to take a closer look.
“Whether or not we need to go further is something Justice Cunningham is going to explore,” Orazietti said at a news conference.
Cunningham, who served on the Ontario Superior Court of Justice, pledged to “consult broadly with the public and industry experts on measures that will strengthen Ontario’s new home warranty program.”
Tarion is a private organization that administers the Ontario New Home Warranties Plan Act, which will also come under Cunningham’s scrutiny. About 50,000 new homes and condos are enrolled in the warranty program annually.
Two years ago, a Star investigation found Tarion kept records of shoddy or incomplete work by homebuilders secret, preventing new homebuyers from getting a full picture from Tarion about builders with problems.
Critics complained that prospective buyers need complete information about builders to make informed decisions when shopping for new homes.
Homeowners have also raised concerns about battles over warranty issues such as repairs to floors, heating systems and other deficiencies.
In a statement, Tarion said the home warranty law has been in place since 1976 and “we agree that it is time to consider how effective the legislation is in today’s new home and condominium industry.”
“This review will provide us with the opportunity to share our thoughts on how to strengthen the legislation so that we can continue to protect Ontario’s new home buyers and regulate new home builders,” added spokeswoman Melissa Yollick.
Tarion receives about 15,000 phone calls a month and paid out almost $10 million in claims last year.
Karen Somerville, president of the national non-profit Canadians for Properly Built Homes, said the review is “long overdue” and she hopes homeowners who feel their claims were wrongfully denied will see their cases reconsidered.
“We encourage all homeowners who feel they have been negatively impacted by what they feel is inadequate consumer protection to come forward, said Somerville, whose organization has been calling for better oversight of Tarion for 11 years.
“This is time to speak up.”
Orazietti said “very significant improvements” at Tarion in the last few years, including a doubling of warranty coverage to $300,000 and removing the majority of builders from the board of directors, have resulted in a one-third drop in complaints.
New Democrat MPP Jagmeet Singh tabled a private member’s bill a year ago that would require Tarion to publish more detailed information about builders’ track records and making the corporation’s bylaws subject to government approval.
NDP Leader Andrea Horwath said the problem with Tarion is that “it is like pulling teeth to try to get those warranties respected” and said the government should be getting on with reforms.
“The review is not necessary. The problems are rampant. If the government doesn’t know what’s wrong with Tarion yet, after all the private members’ bills and all the criticisms we’ve been raising, then they simply have been turning a blind eye to a very bad situatio
**Couple fights Tarion for home warranty: Roseman **

**Unhappy home buyers came to Tarion’s annual meeting June 1 to get answers. **

**Some people felt they were not heard. **

Jeffrey Ferland and his partner spent 30 days from last fall to last month giving testimony at a provincial forum complaining about Tarion Warranty Corp., the private company created and overseen by the Ontario government to protect new home buyers. Kenyon Wallace/Toronto Star
By: Ellen Roseman On Your Side, Published on Tue Jun 02 2015

[FONT=Times New Roman]When Jeffrey Ferland and Aleksandra Ferenc moved into a new house in Mississauga, they found the cement floor wasn’t as thick as what the builder promised. Nor did it comply with the Ontario Building Code.[/FONT]
They complained to Tarion Warranty Corp., the private company created and overseen by the Ontario government to protect new home buyers.
Tarion asked the builder to fix the floor and, when the builder did nothing, it promised to charge the builder for the repair cost, the couple says in a petition aimed at updating Ontario’s new home warranty act.
Later, Tarion decided not to help. Ferland and Aleksandra appealed to the Licence Appeal Tribunal, where they spent a grueling 30 days giving testimony at the forum that handles compensation claims in a quasi-judicial way.
The couple did not hire a lawyer, but faced a Tarion staff lawyer and a top Bay Street lawyer acting for Tarion, plus the builder’s lawyer. They now await the tribunal’s decision, expected shortly.
“It’s a hostile environment for a consumer,” says Barbara Captijn, who became a volunteer consumer advocate after buying a defective new home and losing her own case at the tribunal. She and her husband later won a settlement in small claims court.
After dropping in on the Ferland-Ferenc hearing for nine days, she wrote about the lack of balance in her blog.
“The money Tarion has spent so far on engineers and specialized litigators could have been used to fix the home. Lawyers for this type of hearing can cost $1,500 to $4,000 per day, with an up-front retainer costing anywhere from $30,000 to $60,000.
“What ordinary new home buyer can afford these legal fees? Not even middle class, two-income families. Tarion can, and does, pay these fees, using the warranty fund, which was meant to fix new home defects.”
The couple reached out to Harinder Takhar, the Liberal MLA elected in 2003 to represent their Mississauga riding. They didn’t get a response, but later found a tax return showing Tarion had donated $816 to Takhar’s constituency.
Why would Tarion, with a mandate to protect consumers and regulate the building industry, donate to a politician? Ferland asked the question at Tarion’s annual public meeting, held June 1 in Toronto.
President and chief executive Howard Bogach said he’d stopped the practice of campaign contributions after taking the job in March 2008. “It was not appropriate,” he said. “Optically, it was not good.”
But why did Tarion make political donations in the first place? Bogach never gave a reply.
I was in the audience Monday night. I’d heard that Tarion annual meetings could be raucous affairs, where the staff faced a barrage of questions and complaints from home buyers.
This time, Tarion hired a facilitator, Nigel Bellchamber, a consultant on municipal issues, who kept a tight rein on participation and disallowed any follow-up questions.
An owner in an Oakville housing development with substandard heating systems said: “How can Tarion write regulations that supersede the Ontario New Home Warranties Plan Act?” She was referring to a rule that limits warranty claims to two years. Tarion staff disagreed with her interpretation of the law.
“How much does Tarion pay in legal fees to the Licence Appeals Tribunal?” another homeowner asked. It’s just a small amount, Bogach said, and is not broken down separately.
Ferland asked a number of questions, while his twin brother James called out comments from the floor – and was silenced by Bellchamber.
The couple’s tribunal hearing did make an impact. Bogach announced he was hiring a legal expert, Genevieve Chornenki, to advise him on resolving disputes informally outside the court system.
He may also have been thinking about a private member’s bill by Jagmeet Singh, the Ontario NDP’s consumer critic, to bring Tarion under the oversight of the Ontario Ombudsman and Auditor General.
“Time and time again, we see new homeowners denied the coverage they need and deserve. There are serious problems with accountability and transparency when it comes to the Tarion corporation,” Singh said in a statement.
Correction – June 3, 2015:* This article was edited from a previous version that misstated MPP Jagmeet Singh’s given name. *
Ellen Roseman writes about personal finance and consumer issues. You can reach her at or

**Is Tarion headed for a shake up ? **I hope so