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Ontario appoints adviser to review Tarion

|Written By David Dias

Amid transparency concerns around Tarion Warranty Corp., the Ontario government has appointed a former judge as a special adviser to conduct a review of the organization and related legislation.

‘We think this is an incredibly important step for the province and for Ontario’s purchasers of newly built homes,’ says Karen Somerville.
David Orazietti, the minister of government and consumer services, announced the appointment of justice Douglas Cunningham this morning. Cunningham, former associate chief justice of the Ontario Superior Court, will review Tarion and the Ontario New Home Warranties Plan Act and provide recommendations for improving consumer protection, accountability, transparency, and board governance.

“Justice Cunningham has the expertise, experience, and sound judgment that is critical for this review. We look forward to his recommendations, which will help improve protection for owners of new homes in Ontario,” said Orazietti.

The move comes after years of political debate over Tarion’s mandate to collect fees from purchasers and builders of new homes while critics charge it has kept its internal workings largely secret.

Although Tarion issues an audited annual financial statement, the administrator isn’t accountable to the province’s auditor general or ombudsman, nor does it provide salary information for employees earning more than $100,000 for the province’s sunshine list.

The alleged lack of transparency has led to frequent calls for reform. Former NDP MPP Rosario Marchese tabled bills to that effect in 2010, 2011 and 2012, and most recently NDP MPP Jagmeet Singh brought forward a private member’s bill that would bring Tarion under the jurisdiction of the Ontario ombudsman and the auditor general and require public salary disclosures.

Despite having no public mandate to investigate Tarion, former ombudsman André Marin has reported almost 300 complaints about the administrator from 2007-13. Marin told the Toronto Star that he has “long believed that Tarion lacks proper oversight.”

Karen Somerville, president of the advocacy group Canadians for Properly Built Homes, which has been fighting for reform at Tarion for over a decade, says she’s thrilled by the news. “We think this is an incredibly important step for the province and for Ontario’s purchasers of newly built homes. This is long overdue, and so we’re very pleased that this has finally been announced.”

Somerville is hopeful recommendations will transform the governance of Tarion, which she claims has been unduly influenced by builders and developers at the expense of homebuyers seeking recovery from defectively built properties. “It needs to be truly a consumer-oriented organization with much, much less influence from the Ontario Homebuilders Association and from builders and developers,” she says. “That goes to the heart of the governance issues with Tarion.”

In addition, Somerville hopes recommendations will loosen Tarion’s monopoly over home warranties in the province and provide homebuyers whose claims have been denied an opportunity to resubmit them.

“We hope that Ontarians who have been involved and who have been hurt by the current system will reach out and offer to be part of this process, this study that’s underway. We’re really hoping that Ontarians will choose to participate, will share their experiences, and let this review know why these changes are so important. . . . There are many homeowners who are suffering greatly because their claims were denied.”

Tarion, for its part, says its model as an independent administrator has allowed it to operate quickly, efficiently, and effectively and that it’s required to provide numerous disclosures to the province if not to the public directly.

In April, Tarion chairman Chris Spiteri rebutted a piece of commentary in Law Times in which columnist Alan Shanoff argued Ontarians “have little verifiable or relevant information on whether the public is receiving value for its money.”

Spiteri responded that its model as an independent administrator “provides the Ministry of Government and Consumer Services with oversight of Tarion through its accountability agreement. The government contributes to board composition and the nomination process and requires quarterly reports to the ministry, annual reports, audited financial statements, annual business plans, yearly regulatory plans, and annual public meetings.”

That may not be enough for detractors who will no doubt be waiting eagerly for Cunningham’s recommendations.

  • person

    Cam vienneau
    there should be a simple contract between builder and home buyer .we have made things so complicated ,sometimes you just cant afford to save money .if things get rushed and people always want in early.and there is so much lack of experience with new hires to save money.buyers should do there homework on the builder talk to other people who have homes built ,and ask the proper questions ,we shouldn't have to rely on the government for better builders.this is what happens when things go corporate ,large scale means save where you can labor prices go down and cost goes up ,kinda backwards ,and the same mistake can happen 100 times and no one will see till there is 100 mistakes to fix ,the owner should be able to ask many questions on many things throughout the process, its your home your money ,10 percent slower is 100 percent better ,builder and clients should have the same check lists and go through them together once a week ,simple and all builders should be accountable for there work.
  • Mrs.

    Leny Hardman
    It is about time that the people that are responsible for all the dismay that Tarion has caused the new Homeowners of Ontario, wake up and try to do something that would resolve some of the problems. It is far overdue and it seems that the Government and those in power, that can make changes, are afraid to commit themselves to the cause. What does it take? Get on with it!
  • President

    Karen - CPBH
    Unfortunately, the Tarion Review seems to be stalled. The original deadlines were: May 2016 for draft report and June 2016 for final report from the Reviewer. It is now Aug.

    The Ministry's web-site about this Tarion Review has not been updated in over two months.

    Minister Orazietti (who called this Review) has been shuffled off to another portfolio. The new Minister for Government and Consumer Services (including oversight of Tarion), MPP Lalonde, has not responded to anything sent by CPBH (e.g., requests for meetings) since she was appointed Minister two months ago. Numerous e-mails, telephone calls, and tweets have been sent/made to her.

    Let's hope that we soon see Justice Cunningham's recommendations related to this Review! Ontario's purchasers of newly built homes need help now, more than ever!
  • same ol same ol

    nic lal
    Delay/deny/disparage is the name of their game with a flavorful topping of silence ....
  • Builders need Accountability!

    Andrea Jean
    Built a house one year ago....what a nightmare and would never never do it again or recommend to anyone to do it! Building code violations, building permit violations, lack of appropriate municipal inspections, disregard of lot grading plans I could go on and on.
    Preparing to get Tarion involved so will see what happens.
    The Municipality doesn't seem to care nor is doing anything to help.
    Makes me ill !! I would definitely get involved in a survey to tell my story
  • Mr

    Dan Makos
    Tarion Warranty Corp. exhibited predatory behaviour in my opinion.
    They have a process in place to protect the builder at all cost.
    The cost is paid by the home buyer and tax payer.
    The builder's warranty people were smoking weed in my driveway, rummaging through our personal belongings, making jokes about the appointments they did not keep without notifying me, came to my door and threatened me about a honest comment I made to a prospective buyer in our subdivision. At this point I backed the person making the threat down the stairs and banned the builder from my lot. The police laughed at my complaint about the threat. This is another issue!
    Tarion Warranty Corp. would not help with the situation. I wanted all warranty items to be cleared by professional trades people in a timely manner with minimum time off work on my part .Tarion Warranty Corp. refused to deal with the builder and insisted I let the builder continue with this method of clearing warranty items.
  • mr

    Samuel Jackson
    Change.org. Let's start a petition!
  • President

    Karen CPBH
    There is a related Change.Org petition already underway. Please sign and help get signatures.
    https://www.change.org/p/inquiry-needed-re-the-ontario-building-code
  • Ms.

    Barbara Captijn
    Can anyone in the legal community tell us why a government monopoly without adequate transparency and public accountability is a good thing for consumers? Perhaps the only members of the legal profession who think its a good thing have as clients developers and/or the building lobbies. Why are the Liberals, who receive generous canpaign donations from$ builders, blocking Bill 60 and Tarion reforms to Bill 106?
  • answer ?

    Nicole Lalonde
    could H Bogach and Premier Wynne please answer this question ??
  • Ms.

    Barbara Captijn
    This article doesn't mention Tarion is also regulator of the building industry in Ontario, and sole licensor of builders under the ONHWPA. That means it has a special public trust function, beyond just providing a limited warranty.
    What good is $300,000 of warranty coverage if Tarion uses deadlines and narrow definitions and attack-dog lawyers at the LAT to dismiss claims? As regulator of the industry, Tarion has a duty to the public to provide accurate builder track records, and make builders fix construction defects they've built into new homes. Sadly, because they use their power and money to serve their own and builders' interests, this often isn't happening.
    Transparency and public accountability are long overdue at this government monopoly, Tarion.
    B. Captijn,
    Volunteer Consumer Advocate
  • SYSTEM OVERHAUL

    nic lal
    the total system is ludicrous; it starts with shoddy, negligent , non caring builders, continues with the lack of adequate building inspection by the municipality and Tarion the warranty company taking advantage of this convenient mess and enjoying total independence , lack of oversight and accountability !
  • Its long overdue

    Vince Bertrand
    We have been waiting patiently for over 10 years for our government to get involved & get serious about investing & resolving the many outstanding claims that Tarion has chosen to ignore.
  • Ms.

    Bev Craddock
    This is the first hopeful note that long overdue change might be on the horizon. The current system is worse than no warranty, giving consumers a false sense of security that comes crashing down at the first sign of a major problem.
  • Tarion

    Ray & Joyce
    Tarion is not Home Warranty
    the abuse that has gone on is next to criminal
    this must be Stopped!
  • Mr.

    Gurpreet Singh
    Tarion is a monopoly with a “consumer protection” mandate, and has the responsibility to regulate and license builders. Tarion has the resources to provide mediation or other problem-solving options to consumers without recourse to a courtroom. Yet the LAT continues to be the appeal mechanism for Tarion’s decisions, with Tarion/builders winning 83-96% of the cases, at the taxpayer’s expense. Many consumers feel new home defects should be kept firmly on the plate of the person who “owns the problem” and has the resources to solve them -Tarion.------

    The current Tarion Warranty system falls short in fairness, impartiality, transparency, and accountability towards Ontario new home buyers. TARION is turning out to be another Ornge in Ontario.
    In Summary, I would request Premier Wynee and Minister Orazietti to support Bill 60 or resign, it has been enough for the homeowners/consumers of Ontario.

    MAKE TARION ACCOUNTABLE & SUPPORT BILL 60
  • Make Process Accountable

    Fooled through trust
    I am not supposed to speak about it but,...if anyone thinks mefiation is the answer what occurs is anything but as built Ontario Building Code violation repair with provision of documentation repairs now meet building code. Mediation means they get you in a closed room, can say and do whatever they want and there is not a damn thing you can do about it. What is worse is that it permits legal process to be used to prevent the public from speaking out about any abuse and permits victimization through the silence clause they impose on the public.
  • Ms

    Lynn O
    The people of Ontario, indeed, all Canadians, deserve better than the buffet of trickery and obfuscation they have been served in the new home building business. It's not the builders who need the protection, it's the buyers! The Ontario government has a responsibility here to enforce the building code and set a level playing field. We are looking to you, Justice Cunningham to set this right through your review and recommendations. Enough people have suffered the injustices of the current broken system.
  • former new homeowner

    Daniel Emery
    I lost my new home to foreclosure, waiting nearly four years for Tarion to assess-repair clearly warranted items, which negated the Final Occupancy Permit. No permit to legally inhabit my home, can't secure insurance, can't renew mortgage, foreclosed, just that simple. Tarion ignored their contractors advice to correct water infiltration problem. The end result, Tarion offered no warranty coverage, other than to say "sorry for your loss, your file is closed". I do not think that is in the true mandated spirit of warranty protection. Mr. Howard Bogach has stated via various media outlets that "Tarion will backstop the warranty, if the builder refuses to do so". That, was not the case in my instance. Too late for me, yet this oversight is long over due for consumers, who "think" they have new home warranty protection. The Tarion model of consumer protection is broken, and needs to be fixed.
  • NO MORE DELAYS/EXCUSES

    Nicole Lalonde
    Consumer patience and understanding are now non existent ! Bring on the investigation .... plenty of evidence to confirm that an honest and thorough check of this outrageous monopoly is warranted !
  • Dr.

    Aleksandra Ferenc
    Make Tarion Accountable! https://www.facebook.com/maketarionaccountable/
  • Mr

    Bill Ontario
    They should also investigate the water heater rental scam new-home buyers face. You are basically forced into renting a tank with no way out. $40/month for the life of the tank... A new tank costs less than 1K and it comes with a +6 year warranty. I'm surprised so many people in Ontario just go along with this illigal practice.
  • Ms.

    Barbara Captijn
    You're right, this is part of a bigger boondoggle on the public. Tarion's response to defects in design/installation of water heating systems in new homes where rental equipment has been installed is: "its a rental, we don't cover rental equipment installed by builders in new homes." Direct Energy and the like say "sue your builder", and we won't give you a copy of the rental contract, ask the builder, we made the contract with him, not you." The builder says "catch me if you can", and the Ministry's (MGCS) respone is "sue your builder". Why do we need a licensor of builders (Tarion), regulator of the building industry (Tarion),and oversight Ministry if their advice is "sue your builder"? Consumers find themselves yet again in the middle of another legal quagmire, paying for someone else's wrong-doing.
  • END THE MONOPOLY

    Alan Greenberg
    Time is long overdue to end this Mandatory Monopoly.
  • Mrs.

    Lori Bryden
    Long overdue for homeowners like ourselves who have tried to build a home in Ontario. There is no protection! This investigation is long overdue!

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