Tribunals Ontario  
Tribunaux décisionnels Ontario  
Licence Appeal Tribunal  
Tribunal d'appel en matière de permis  
Citation: Ragoobar v. Tarion Warranty Corporation, O’Dwyer Fine Homes Ltd., 2022  
ONLAT ONHWPA 12495  
Date: 2022-05-25  
File Number: 12495/ONHWPA  
Appeal of a Decision Letter of Tarion Warranty Corporation under  
the Ontario New Home Warranties Plan Act, R.S.O. 1990, O.31 - to Disallow a Claim  
Between:  
Mark and Laurie Ragoobar  
Appellants  
and  
Tarion Warranty Corporation  
Respondent  
and  
O’Dwyer Fine Homes Ltd.  
Added Party  
DECISION AND ORDER  
Adjudicator:  
Kevin Lundy, Member  
Appearances:  
For the Appellant:  
For the Respondent:  
For the Added Party:  
Patrick Pacheco, Paralegal  
Ted Weredynski, Paralegal  
Adam Raikes, Counsel  
Heard by Videoconference: April 11 - 13, 2022  
Decision and Order  
12495/ONHWPA  
A.  
OVERVIEW  
[1]  
On November 7, 2019, Tarion Warranty Corporation (‘Tarion’) issued a Decision  
Letter denying the claim filed by the Appellants, Mark and Laurie Ragoobar, for  
warranty coverage as set out in their Second Year Form. The Added Party,  
O’Dwyer Fine Homes Ltd. (‘O.F.H.’), is the vendor and builder of the Appellants’  
single family detached house and may be liable to either effect repairs or  
reimburse Tarion for the cost of repairs in the event that the claims are found to be  
warranted. On December 17, 2019, M.R. filed a Notice of Appeal to the Licence  
Appeal Tribunal (the ‘Tribunal’) with respect to Tarion’s decision.  
[2]  
The hearing commenced on April 11, 2022 by videoconference and continued on  
April 12, 2022 and April 13, 2022. As requested by the parties and ordered by the  
Tribunal, a court reporter was present. Mark Ragoobar (‘M.R.’), Rod Ponkin  
(‘R.P.’), Ron Salisbury (‘R.S.’), Tim Semenuk (‘T.S.’), Gordon O’Dwyer (‘G.O.’),  
Jordan Miller (‘J.M.’), Gerry Spina (‘G.S.’), Audree Shikter (‘A.S.’) and James  
Buren (‘J.B.’), testified at the hearing. M.R., T.S. and G.O. attended the full three  
days as instructing clients to their counsel while the other witnesses were  
excluded until their evidence was called.  
B.  
ISSUES  
[3]  
The appeal related to the following three items that Tarion deemed unwarranted in  
the Decision Letter:  
(1-2) Interior - Basement – Hallway – Water penetration of  
basement or foundation – Water damages created mold, this was  
repaired, however the mold is back.  
(1-3) Interior – Basement – Water penetration of basement or  
foundation – office had water damages mold, this was repaired  
and the mold is back.  
(6-2) Exterior – Roof (Exterior) – Building Face/Exterior – Exterior  
cladding defects (e.g. exterior wall coverings, including siding  
and above grade masonry) – Front door entrance – flashing needs  
to be added, water has been leaking under shingles for 2 years.  
[Emphasis in original]  
[4]  
As a result, the issues to be determined at the hearing were:  
a. Was there a breach of one or more of the warranties under the Ontario  
New Home Warranties Plan Act, R.S.O. 1990, c. O.31 (the ‘Act’)?  
b. If so, did the Appellants suffer monetary damage as a result of the breach  
or breaches?  
c. What is the amount of these damages?  
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C.  
RESULT  
[5]  
For the following reasons, and having considered the evidence and submissions, I  
find that the Appellants failed to demonstrate a breach of warranty on the balance  
of probabilities.  
D.  
PRELIMINARY MATTERS  
[6]  
While the Decision Letter listed both homeowners, the appeal was filed only in  
M.R.’s name. As I find that M.R.’s spouse, Laurie Ragoobar (‘L.R.’), has an  
interest in the proceedings, the appeal was amended to add L.R. as a party. M.R.  
participated in the hearing on her behalf.  
[7]  
The parties had filed a number of motions prior to the hearing that were addressed  
at the start of the proceeding on the first day of the hearing.  
Appellants’ Motion to Exclude Tarion’s Book of Authorities  
[8]  
The Appellants moved to exclude Tarion’s Book of Authorities, alleging that Tarion  
had contravened the Tribunal’s Case Conference Report and Order that required  
all parties to serve and file their respective evidence at least ten days before the  
first day of the hearing. Tarion served and filed its Book of Authorities only seven  
days before the first day of the hearing. The Appellants relied upon Rules 9.2 and  
9.4 of the Common Rules of Practice and Procedure Version I (October 2, 2017)  
(the ‘Rules’) in support of their motion.  
[9]  
A plain reading of these Rules clearly indicates that they are intended to address  
the documents, photographs, invoices and similar items specific to a particular  
proceeding that may not be otherwise available to a party absent an order for  
disclosure. By contrast, a Book of Authorities usually includes copies of statutes,  
regulations and caselaw, none of which is captured by Rules 9.2 and 9.4.  
Therefore, I do not find that Rules 9.2 and 9.4 support the Appellants’ motion.  
Even if I am wrong, Rule 9.4 empowers the Tribunal to admit a document not  
served or filed in compliance with Rule 9.2. For all of these reasons, I dismissed  
the motion.  
[10] All three representatives were invited to rely upon any caselaw that they believed  
to be persuasive in their submissions by citation regardless of prior inclusion in a  
Book of Authorities. While counsel for O.F.H. availed himself of this option,  
counsel for the Appellants ultimately did not.  
[11] On the subject of caselaw, at the hearing, M.R. took the position that no caselaw  
should be considered that predated the October 2019 Special Audit of the Tarion  
Warranty Corporation. However, he offered no authority for this assertion and the  
referenced report was not evidence before the Tribunal. The Tribunal also lacks  
any jurisdiction over legislative policy. Even putting aside the Appellants’ failure to  
file this request in advance of the hearing as a motion in accordance with Rule 15,  
I find no basis for limiting the caselaw or other authorities for this purpose.  
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Appellants’ Motion to Exclude Testimony of Two of O.F.H.’s Expert Witnesses  
[12] The witness list filed by O.F.H. included J.W., who would have offered evidence  
regarding his work framing the house in response to allegations raised by the  
Appellants and F.B., a roofer who would have offered a similar scope of testimony  
with respect to the roof construction, also in response to allegations raised by the  
Appellants.  
[13] The Appellants filed a motion to exclude the testimony of these witnesses on the  
basis that O.F.H. was attempting to call witnesses who were “qualified to provide  
professional information and technical information based on opinion, special  
knowledge and experience” in the absence of the required documentation under  
Rule 10. Specifically, Rule 10.2 imposes strict informational requirements with  
respect to expert witnesses so that opposing parties may have a reasonable  
opportunity to review and investigate their qualifications prior to the hearing:  
10.2 EXPERT WITNESSES (IDENTIFICATION AND DISCLOSURE)  
A party who intends to rely on or refer to the evidence of an expert  
witness shall provide every other party with the following information in  
writing:  
(a) The name and contact information of the expert witness;  
(b) A signed statement from the expert, in the Tribunal’s required  
form, acknowledging his or her duty to:  
(i) Provide opinion evidence that is fair, objective, and non-  
partisan;  
(ii) Provide opinion evidence that is related to matters within  
his/her area of expertise; and  
(iii) Provide such additional assistance as the Tribunal may  
reasonably require to determine a matter in issue;  
(c) The qualifications of that expert witness, referring specifically to  
the education, training and experience relied upon to qualify the  
expert;  
(d) A signed report that sets out the instructions provided to the  
expert in relation to the proceeding, the expert’s conclusions,  
and the basis for those conclusions on the issues to which the  
expert will provide evidence to the Tribunal; and  
(e) A concise summary stating the facts and issues that are  
admitted and those that are in dispute, and the expert’s findings  
and conclusions. [Emphasis in original]  
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[14] Counsel for O.F.H. stipulated that he had no intention of calling the proposed  
witnesses to offer expert evidence, but instead to testify to their direct observations  
as “lay witnesses” with respect to their respective roles in the construction of the  
Appellants’ house. As a result, there was no necessity to provide the information  
required by Rule 10.2.  
[15] As I find nothing to support the Appellants’ assertion that the proposed testimony  
regarding direct observations of construction inherently falls under the category of  
expert testimony, the motion was denied in part. O.F.H. was free to call either or  
both witnesses to testify to their direct observations, but not to offer expert  
evidence. O.F.H. ultimately elected not to call either witness.  
O.F.H.’s Motion to Strike ‘Overview and Timeline’ filed by Appellants  
[16] The Appellants filed a document entitled “The Overview and Timeline of the  
Matter,” which O.F.H. viewed as implied assertions as fact. As the parties had not  
arrived at any agreed statement of facts, counsel for O.F.H. took the position that  
the Appellants had unilaterally included this document in their materials in an  
attempt to circumvent their duty to prove the allegations in their appeal and taint  
the matter before it was heard by the Tribunal.  
[17] However, counsel for the Appellants readily acknowledged that the statements in  
this document were intended to function similarly to an opening statement rather  
than as an agreement of facts. There was no dispute that the Appellants bore the  
evidentiary onus to prove all elements of their appeal on the balance of  
probabilities including the timeline of events.  
[18] As I find that the basis of the motion was moot, it is denied.  
O.F.H.’s Motion for an Order Limiting Evidence to only those Issues under Appeal  
[19] Counsel for O.F.H. noted that the Appellants have previously indicated that it is  
their intention to litigate issued contained in the 30-Day Statutory Warranty Form  
and the Year-End Statutory Warranty Form as well as the Second-Year Statutory  
Warranty Form.  
[20] As noted at paragraph 3 above, the Appellants listed only items 1-2, 1-3 and 6-2 of  
the Tarion Decision dated November 7, 2019 in their Notice of Appeal filed on  
December 17, 2019. These items relate solely to the Second Year Form. As a  
result, the appeal process does not permit the Appellants to resurrect other issues  
from prior forms or add other items not included in any form.  
[21] As the Tribunal has no jurisdiction to issue an order in relation to issues not under  
appeal, the motion was granted.  
[22] That having been said, this limitation should not be confused with an exclusion of  
evidence on the necessary historical context of the three items in dispute since  
their emergence predated the submission of the Second Year Form. As events  
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from the first year of occupation had direct consequences upon the warrantability  
of two of the disputed items, evidence regarding this context was necessarily  
admissible.  
O.F.H.’s Motion to Strike the ‘Engineer Expenses’ Brief filed by the Appellants  
[23] The Appellants sought compensation or damages for amounts allegedly incurred  
to commission expert opinions and reports. However, like legal costs, such  
expenses represent secondary damages, which are excluded under Act and its  
related regulations.  
[24] Subsection 13(1) of the Act sets out the general warranty provided by the vendor  
to the owner of a new home in Ontario:  
13. (1) Every vendor of a home warrants to the owner,  
(a) that the home,  
(i) is constructed in a workmanlike manner and is free from  
defects in material,  
(ii) is fit for habitation, and  
(iii) is constructed in accordance with the Ontario Building  
Code;  
(b) that the home is free of major structural defects as defined by  
the regulations; and  
(c) such other warranties as are prescribed by the regulations.  
[25] However, this general provision is subject to a host of exclusions specifically  
enumerated in subsection 13(2) of the Act, the most relevant to the Appellants’  
Engineer Expenses Brief being paragraph (b), which states:  
13. (2) A warranty under subsection (1) does not apply in respect of,  
(b) secondary damage caused by defects, such as property  
damage and personal injury…  
[26] As the somewhat nebulous term “secondary damage” in paragraph (b) of  
subsection 13(2) of the Act is not defined in the Act, the scope of this exclusion  
has been the subject of analysis by both the Tribunal and the Courts. In Liddiard  
v. Tarion Warranty Corporation, the appellant homeowners sought compensation  
for the diminished value of their home allegedly resulting from the breach of  
warranty.1 The Ontario Divisional Court considered the meaning of “secondary” in  
this context as follows:  
1 (2009) 99 O.R. (3d) 656 (Ont. Div. Ct.) (‘Liddiard’).  
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The term “secondary” is not defined in the statute. The seventh edition  
of Black’s Law Dictionary defines “secondary” as “subordinate or  
subsequent”. The two opening entries for the word in the 1993 edition  
of the New Shorter Oxford English Dictionary on Historical Principles  
define the word as (1) not chief or principal; of minor or second  
importance; subordinate and (2) derived from, caused by, based on or  
dependent on something else which is primary; not original, derivative.  
The meaning of the word in the context of this Act can be gleaned,  
however, from the two examples provided in the section: property  
damage and personal injury and, in my view, the term “secondary” is  
not connected, in this context, with either the importance or the  
magnitude of the loss or damage, but rather with the character of it.  
Clearly, the term “personal injury” encompasses very grave loss and  
harm, if not death itself. It is difficult to envisage damage of greater  
importance and yet that type of loss is excluded. I therefore conclude  
that the drafters intended the term “secondary” to mean that which is  
derivative. Accordingly, the immediate result of the breach of warranty  
is covered and all that is derivative is excluded.2  
[27] The Court went on to clarify that when read together, subsections 13(1) and (2) of  
the Act serve to limit the scope of liability to repair the issues not constructed  
pursuant to the factors listed in paragraph (a) of subsection 13(1) of the Act or a  
sum of money required to purchase the labour and materials to do so:  
The warranty is set out at s. 13(1). The primary and immediate result of  
breach of warranty is construction that is not done in workmanlike  
manner and free from defects in material or is not fit for habitation or is  
not constructed in accordance with the Ontario Building Code or is not  
free of major structural defects or is in breach of some other warranty  
prescribed by the regulations.  
What is conferred by the warranty is the right to have done that which  
should have been done correctly in the first instance or a sum of  
money to purchase the labour and materials to do so. Any loss or  
damage that is derivative of the failure to construct in accordance with  
s. 13(1) is secondary and therefore excluded. Even assuming that  
causation can be shown, loss of value on sale of a property is  
derivative and thus secondary and excluded.3  
[28] Following the decision in Liddiard, the Tribunal has specifically held that other  
costs indirectly related to the construction of the home fall squarely under  
“secondary damage” and are therefore excluded. For instance, in Xin (Melissa)  
2 Ibid. at paras. 49-50.  
3 Ibid. at paras. 51-52.  
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Chang v. Tarion Home Warranty Corporation, the Tribunal characterized the issue  
as a jurisdictional matter:  
Taking a step backwards then, the Tribunal’s jurisdiction can only  
come from things about which Tarion can make a decision. Namely,  
warranty. Section 13 of the Act outlines what is warranted, and section  
13(2) outlines specifically what is excluded. Secondary damage,  
including personal injury and property damage, is excluded. Case law  
put forward by Tarion supports the proposition that ‘secondary  
damage’ is interpreted to mean any damage that is not a direct breach  
of warranty.  
This, in my opinion, excludes the appellant’s claims for $100,000 in  
damages, aggravated damages for personal injury, and recovery of  
legal and other costs related to the construction of the home. The  
Tribunal, therefore, cannot consider these issues because Tarion  
cannot consider these issues.  
With respect to the declarations and injunction sought, the Tribunal is  
not a court of equity. The Tribunal as a creature of statute, cannot  
venture outside of the boundaries of the statute to bestow itself with  
powers that the statute does not confer.  
The appellant argues that the Act is consumer protection legislation  
and should be interpreted broadly and liberally to give that effect. I  
agree. And I sympathize that the appellant feels she has been treated  
unjustly, unfairly, and in some cases discriminatorily. However,  
interpreting a statute broadly and liberally does not mean inventing the  
power to do something where that power does not exist in the statute,  
particularly where there is a specific exclusion in that regard.4  
[29] As the filed “Engineer Expenses” Brief does not relate to the substance of the  
items under appeal, namely 1-2, 1-3 and 6-2 of Tarion's Decision dated November  
7, 2019, the Tribunal lacks jurisdiction to award the relief for these secondary  
damages.  
[30] As a result, the motion was granted.  
O.F.H’s Motion to Exclude Expert Report by Appellant’s Witness, R.P.  
[31] In the Appellants’ February 4, 2022 Request to Adjourn, their counsel stated, “our  
clients are currently waiting on an expert report that will be necessary in  
presenting the appropriate evidence with regards to the roof construction.”  
4 2020 12761 at paras. 15-18 (ON LAT).  
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[32] Expert evidence presented to the Tribunal should be, and should be seen to be,  
the independent product of the expert uninfluenced as to form or content by the  
party offering it.  
[33] However, both O.F.H. and Tarion expressed grave concerns with respect to the  
admissibility of the purported expert report on the basis that M.R.’s inappropriate  
level of contribution to its creation severely undermined its status as independent  
and impartial expert evidence. As counsel for O.F.H. noted, M.R. signed the  
report with R.P. and may have generated much of its content, thereby rendering it  
biased. They submitted that the report was tainted, among other things, by the  
controlling influence of M.R. and his desired outcome to the appeal.  
[34] As a result of this influence, O.F.H. took the position that R.P. was incapable of  
complying with or fulfilling his primary duty to provide impartial expert opinion  
evidence that is fair, objective and non-partisan, contrary to Rule 10.4 of the  
Common Rules.  
[35] That R.P.’s company, RJeneration London Roofing and Renovations  
(‘RJeneration’), also served as a quoting party on the cost of repairs of the roof  
and the window well further undermined the independence of the report as  
RJeneration has a direct financial interest in the outcome of the appeal.  
[36] As a result, both O.F.H. and Tarion submitted that the report should be excluded  
as evidence at the hearing. In support of this position, counsel for O.F.H. relied  
upon Justice Binnie’s warning in R. v. J.-L.J., with respect to questionable expert  
evidence:  
In the course of Mohan and other judgments, the Court has  
emphasized that the trial judge should take seriously the role of  
“gatekeeper”. The admissibility of the expert evidence should be  
scrutinized at the time it is proffered, and not allowed too easy an entry  
on the basis that all of the frailties could go at the end of the day to  
weight rather than admissibility.5  
[37] However, prior to the commencement of the hearing, the precise proportion of the  
contributions from M.R. versus R.P. to the creation of the report were not  
sufficiently clear. In the very next paragraph in the above decision, Justice Binnie  
noted that the same gatekeeper function must afford the parties the opportunity to  
put forward the most complete evidentiary record consistent with the rules of  
evidence.6  
[38] In White Burgess Langille Inman v. Abbott and Haliburton Co., the Supreme Court  
of Canada described the threshold for exclusion as follows:  
5 [2000] 2 S.C.R. 600 at para. 28.  
6 Ibid. at para. 29.  
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This threshold requirement is not particularly onerous and it will likely  
be quite rare that a proposed expert’s evidence would be ruled  
inadmissible for failing to meet it. The trial judge must determine,  
having regard to both the particular circumstances of the proposed  
expert and the substance of the proposed evidence, whether the  
expert is able and willing to carry out his or her primary duty to the  
court. For example, it is the nature and extent of the interest or  
connection with the litigation or a party thereto which matters, not the  
mere fact of the interest or connection; the existence of some interest  
or a relationship does not automatically render the evidence of the  
proposed expert inadmissible. In most cases, a mere employment  
relationship with the party calling the evidence will be insufficient to do  
so. On the other hand, a direct financial interest in the outcome of the  
litigation will be of more concern. The same can be said in the case of  
a very close familial relationship with one of the parties or situations in  
which the proposed expert will probably incur professional liability if his  
or her opinion is not accepted by the court. Similarly, an expert who, in  
his or her proposed evidence or otherwise, assumes the role of an  
advocate for a party is clearly unwilling and/or unable to carry out the  
primary duty to the court. I emphasize that exclusion at the threshold  
stage of the analysis should occur only in very clear cases in which the  
proposed expert is unable or unwilling to provide the court with fair,  
objective and non-partisan evidence. Anything less than clear  
unwillingness or inability to do so should not lead to exclusion, but be  
taken into account in the overall weighing of costs and benefits of  
receiving the evidence.7  
[39] During the preliminary motions phase of the hearing, it was not possible to assess  
R.P.’s apparent commitment to his proper duties as a proposed expert and, as a  
result, his potential for bias was unclear. As a result, I opted not to exclude the  
impugned evidence prior the hearing and to instead assess the evidence as it was  
presented, assigning it the appropriate probative weight. The motion was  
therefore denied.  
E.  
LAW  
[40] Given the detailed nature of much of the evidence presented, a brief overview of  
the statutory context for the role of Tarion in the warranty process for new homes  
may be useful for the issues in this appeal.  
[41] Tarion is a private, non-profit corporation designated by the Lieutenant Governor-  
in-Council to administer the Act and manage its warranty scheme. Each new  
home constructed in Ontario for sale or built by a builder who contracts to carry out  
all of the construction on the home on behalf of the owners, must be enrolled  
7 2015 SCC 23 at para 49.  
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with Tarion with an enrolment fee paid prior to the commencement of  
construction.  
[42] Tarion does not operate as an insurance company. Instead, its role is to ensure  
that builders comply with the statutory warranties set out in the Act. The  
warranties are those of the builder, not Tarion. The builder is also required to  
respond to warranty claims as submitted by homeowners to Tarion within certain  
defined time periods. A homeowner may ask Tarion to intervene by requesting a  
conciliation only if a builder fails to complete warranty repairs in a timely manner  
and the homeowner believes that one or more warranted items have not been  
repaired or resolved within the allowed time limits. At this stage of the process, no  
finding has been made for or against either the builder or the homeowner.  
[43] When a homeowner requests a conciliation, Tarion schedules an inspection and  
notifies the builder. The builder is given a further period after the date the  
homeowner requests the conciliation inspection to repair or resolve all of the claim  
items. Unless the homeowner requests that the conciliation inspection be  
cancelled, a warranty services representative from Tarion will attend, review the  
homeowner’s claims and issue a Warranty Assessment Report (‘WAR’) that  
includes findings of warrantability or non-warrantability for each disputed item.  
[44] If Tarion determines that at least one item in the WAR is warranted, barring some  
specific exemptions, the conciliation will be deemed chargeable against the  
builder’s record. The builder is then permitted a further period to conduct repairs,  
failing which, Tarion will then schedule a claims inspection with the homeowner.  
In such circumstances, the only issue to be determined is whether the builder has  
carried out repairs to those items determined to be warranted in the WAR. If  
not, Tarion will arrange to carry out the repairs or provide cash compensation to  
the homeowner from its Guarantee Fund.  
[45] With respect to the provisions of the Act relevant to this appeal, subsections 13(1)  
and (2) have been reproduced above. In addition, subsection 14(1) to (4) address  
compensation from the guarantee fund:  
14.(1) Subject to the regulations, a person who has entered into a contract  
to purchase a home from a vendor is entitled to receive payment out of  
the guarantee fund for the amount that the person paid to the vendor  
as a deposit or other payment to be credited to the purchase price  
under the contract on closing if,  
(a) the person has exercised a statutory right to rescind the contract  
before closing; or  
(b) the person has a cause of action against the vendor resulting  
from the fact that title to the home has not been transferred to  
the person because,  
(i) the vendor has gone into bankruptcy, or  
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(ii) the vendor has fundamentally breached the contract.  
(2) Subject to the regulations, an owner of land who has entered into a  
contract with a builder for the construction of a home on the land  
and who has a cause of action against the builder for damages  
resulting from the builder’s failure to substantially perform the  
contract, is entitled to receive payment out of the guarantee fund of  
the amount by which the amount paid by the owner to the builder  
under the contract exceeds the value of the work and materials  
supplied to the owner under the contract.  
(3) Subject to the regulations, an owner of a home is entitled to receive  
payment out of the guarantee fund for damages resulting from a  
breach of warranty if,  
(a) the person became the owner of the home through receiving a  
transfer of title to it or through the substantial performance by a  
builder of a contract to construct the home on land owned by the  
person; and  
(b) the person has a cause of action against the vendor or the  
builder, as the case may be, for damages resulting from the  
breach of warranty.  
(4) Subject to the regulations, an owner who suffers damage because  
of a major structural defect mentioned in clause 13 (1) (b) is entitled  
to receive payment out of the guarantee fund for the cost of the  
remedial work required to correct the major structural defect if the  
owner makes a claim within four years after the warranty expires or  
such longer time under such conditions as are prescribed.  
[46] Section 14 and subsection 15(2) of Reg. 892 are also relevant with respect to the  
general parameters of the builder’s warranty to the owner for claims submitted  
within the two year warranty period:  
14.(1) Every vendor of a new home warrants to the owner that there will  
be no water penetration through the basement or foundation of the  
home.  
(2) The warranty described in subsection (1) applies only in respect of  
claims made during a two-year warranty period ending on the  
second anniversary of the date of possession.  
15.(2) Every vendor of a new home warrants to the owner,  
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(a) that the home is constructed in a workmanlike manner and is  
free from defects in materials including windows, doors and  
caulking such that the building envelope of the home prevents  
water penetration;  
(b) that the electrical, plumbing and heating delivery and distribution  
systems are free from defects in material and work;  
(c) that all exterior cladding of the home is free from defects in  
material and work resulting in detachment, displacement or  
physical deterioration;  
(d) that the home is free from violations of the Ontario Building  
Code regulations under which the Building Permit was issued,  
affecting health and safety, including but not limited to fire  
safety, insulation, air and vapour barriers, ventilation, heating  
and structural adequacy; and  
(e) that the home is free of major structural defects.  
[47] Lastly, subsection 14(19) of the Act sets out the orders available to the Tribunal  
following the hearing:  
14.(19) After holding a hearing, the tribunal may,  
(a) by order, direct the Corporation to take the action that the  
tribunal considers the Corporation ought to take in accordance  
with this Act and the regulations; and  
(b) for the purposes of the order, substitute its opinion for that of  
the Corporation.  
F.  
EVIDENCE AND ANALYSIS:  
Background  
[48] The Appellants’ house is a two-storey detached single family dwelling with a  
basement. The garage is located to the left side of the front of the house. The  
foundation plan of the house was substantially unchanged in the completed  
structure other than the deletion of a few minor elements. The basement office,  
hallway and other locations that are the subject of part of this appeal remained  
consistent with the original design plan.  
[49] With respect to builder in this matter, G.O. is the operator of O.F.H. and has  
worked in the field of home renovations and construction for the past thirty-four  
years since he was seventeen. He does not hold any professional certifications or  
diplomas and has not undertaken in any formal apprenticeships. After he  
graduated from high school, he operated a series of companies with his father and  
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later his brother-in-law, building kitchens and bathrooms. In 2010, he limited his  
business primarily to home building with some renovations for past clients. He  
conservatively estimated that he has worked on at least one hundred homes over  
the course of his career and has constructed approximately thirty-five to forty  
houses from scratch. He was licenced as a builder during the relevant period  
under this appeal.  
[50] He stopped building houses in 2019. While M.R. and his counsel repeatedly  
referred to this termination as G.O. “going out of business,” the Appellants offered  
no clear or reliable evidence with respect for the reason for this transition.  
[51] M.R. has been employed in the insurance industry for twenty-three years and  
holds a Building Code Identification Number (‘B.C.I.N.’), which as he explained,  
designates him as knowledgeable under Section 9 of the Ontario Building Code.  
[52] M.R. and G.O signed an Agreement of Purchase and Sale for the home on May  
18, 2016. Construction was originally scheduled for completion in November,  
2016. However, after four delays, the Appellants obtained possession of the  
house on April 12, 2017. M.R. acknowledged that he reluctantly consented to at  
least two of these postponements. G.O. explained that the delays were not out of  
the ordinary and recalled that one related to problems with the availability of  
various trades and another with changes to the design drawings, as well as a  
routine postponement to the electrical walkthrough. While none of these  
impediments directly relate to the issues under appeal, they offer a narrative  
context to the later breakdown of the relationship between the Appellants and their  
builder.  
[53] G.O. provided a brief but highly detailed overview of the preliminary stages of  
residential house construction from the initial design phase through municipal  
approvals to the installation of the irrigation system around the foundation prior to  
backfilling. There was no evidence that work on the site failed any required  
building inspection or that any inspections were not completed.  
[54] From early 2017 onward, the Appellants received regular information from Tarion  
with respect to the process for reporting warranty items, keeping track of key dates  
related to the warranty, filling out forms online, receiving email reminders for  
important warranty deadlines and contacting Tarion for further information. M.R.  
acknowledged receipt of these forms and readily agreed that they provided  
information to contact Tarion in the event of difficulties or any confusion with the  
process.  
The Pre-Delivery Inspection and Other Matters  
[55] M.R. testified at length with respect to delays in completing the Pre-Delivery  
Inspection report (the ‘P.D.I.’) prior to the closing and his attempts to book follow-  
up appointments with G.O.  
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[56] Subsection 2(7) of Reg. 892 requires that “On the pre-delivery inspection date, the  
vendor shall complete and sign a certificate of completion and possession form  
and a pre-delivery inspection form approved by the Corporation and deliver a copy  
of the completed and signed forms to the purchaser or owner.” Similarly,  
subsections 2(2) and (12) of O. Reg. 637/20 require that vendor agreements  
contain provisions which amongst other requirements respecting covenants to  
address obligations regarding pre-delivery inspections.  
[57] However, whether or not O.F.H. complied with these provisions of the Regulations,  
is separate and apart from the issues raised in the present appeal. I do not find  
that the Appellants demonstrated on the balance of probabilities that the absence  
of a completed P.D.I. had any material impact on Tarion’s decision to deny  
warranty coverage for the three items referenced in the November 7, 2019  
Decision Letter. Also, unlike the 30-Day Form and the two later yearly forms, the  
PDI form, although useful, does not activate the claims process. Even in the  
absence of that form, the Appellants’ remedy was to file the 30-Day Form, which  
M.R. did on May 10, 2017, roughly one month after delivery.  
[58] Subsection 25.0.1 of the Statutory Powers Procedures Act (the ‘SPPA’) permits  
the Tribunal to determine its own procedures and practices and make orders with  
respect to the procedures and practices that apply in any particular proceeding.  
However, this does not grant either Tarion or the Tribunal discretion to exceed  
their statutory jurisdiction.  
Water Penetration in the Basement  
The April 2017 Flood  
[59] Although the present appeal only directly relates to Tarion’s denial of items on the  
Second Year Form, with respect to items 1-2 and 1-3 on that form, the Appellants  
sought to demonstrate that one or more floods in the basement within one week of  
the closing date in 2017 directly led to mould growth in the basement that  
remained unresolved to the date that the Appellants submitted their Second Year  
Form. As a result, some consideration of the events leading to the submission of  
the Second Year Form is necessary.  
[60] There is no dispute that on or about April 11, 2017, there was a flood in the  
basement of the house. At the hearing, G.O. testified that any construction site  
may be subject to flooding, but agreed that this was obviously not ideal. In the  
present case, he determined that the O-pipe in the window well in the office had  
filled with water and emptied into the basement through the window and down the  
face of the interior wall below. He used a squeegee and a mop to clean up the  
water on the floor and set up a fan to dry out the flooring. He estimated that  
approximately fifteen gallons of water had entered the basement. However, he  
found no other points of water  
[61]  
into the house.  
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[62] M.R. testified that when he attended at the house on April 12, 2017 specifically for  
the closing, he discovered water had entered the basement through the window  
well and that the window in the basement had flooded with dirty water from a  
downspout on the adjacent model home. He noticed the mop and bucket still  
present in the basement and concluded that G.O. must have been aware of the  
flood although the builder was not then present in the house.  
[63] While there was some dispute regarding the date that G.O. discovered the flood  
relative to his notification to M.R., between G.O.’s inconsistent timeline and M.R.’s  
more consistent and logically persuasive evidence on this issue, I prefer M.R.’s  
account and find on the balance of probabilities that G.O. discovered the flood on  
April 11, 2017, made some efforts to clean up the water, but may not have advised  
M.R. of the problem until the following day. This version of events is also  
consistent with G.O.’s apparent nonchalance over the issue of flooding in an active  
construction site.  
[64] While M.R. estimated that the damp flooring indicated that the flood must have  
occurred three of four days earlier, he offered no objective evidence to support this  
speculation. As it was raining on the day that G.O. discovered the water entering  
the window well and there was no evidence of any prior flooding or similarly  
inclement weather during the days immediately preceding April 11, 2017, I find on  
the balance of probabilities that the flooding event was likely limited to April 11,  
2017 only.  
[65] The parties’ disagreement with respect to when the flooding occurred relative to  
M.R.’s discovery of it is significant not because the floor may have been wet for  
more than one day, but because the interval, however long, served to sow the  
initial seeds of distrust between M.R. and G.O. It also related to the weather  
conditions later determined necessary for water to penetrate the building  
envelope.  
[66] M.R. testified that G.O. had assured him that he would dig a trench to address the  
grading that G.O. believed had caused the problem. While no water testing  
occurred at this time, as of April 2017, the immediate source of the water  
penetration was far from a mystery. They discussed the best steps to dry out the  
basement flooring and G.O. suggested to M.R. that the floor should be allowed to  
dry before the carpet was installed. Under cross-examination, M.R. testified that it  
was his understanding that G.O. preferred to dry out the floor rather than tearing it  
out and replacing it. G.O. emphasized that water accumulation in the basement of  
a house during construction was not an uncommon event.  
[67] However, M.R. testified that when he attended at the house two weeks later, he  
found that the same leak had recurred and that O.F.H. had not yet graded the  
property. He opted to mitigate the damage by finishing cleaning up the water  
himself. He testified that when he called G.O. a second time to express his  
concerns, G.O. did nothing about it. As a result, M.R. decided to dig a trench  
outside the window himself to prevent a third flood from occurring.  
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The 30-Day Form  
[68] On May 10, 2017, M.R. filed his 30-Day Form with Tarion, including these and  
numerous other outstanding issues. The above issues were described on the  
Form as items 6 and 7 respectively under ‘Outstanding Items’ in the basement as  
follows:  
Rip out wall where water damages have occurred since Oct/2016 â??  
[sic] Mold located – water leak must be found  
Inspect for mold in office (flooded twice) moisture can be seen on dry  
wall from under stairs – cut out access hole moisture located  
[69] Tarion informed him by a letter dated May 11, 2017 that his 30-Day Form had  
been received and that the builder had until September 11, 2017 to resolve the  
issues in the form, failing which he could request a conciliation inspection that  
would allow Tarion to assess the issues. He requested the conciliation and  
agreed at the hearing that it took place on November 20, 2017.  
[70] G.O. believed that they were working together to resolve the outstanding issues on  
the 30-Day Form. However, while M.R. testified that G.O. became increasingly  
difficult to contact, G.O. was emphatic that he always answered M.R.’s calls and  
attended at the property when his presence was requested. M.R. did not rely  
upon any written emails or text messages to support his allegation that G.O.  
appeared to be avoiding him. As the Appellants’ evidence on this issue was no  
more persuasive than that offered by O.F.H., I find that the Appellants failed to  
demonstrate on the balance of probabilities that G.O. failed to communicate with  
them.  
[71] Nevertheless, in mid-May 2017 after he filed the 30-Day Form, M.R. dug a trench  
outside the basement office window well. G.O. did not tell M.R. to take this action  
and testified that M.R. made the decision to undertake this work himself. To  
prevent further water penetration, O.F.H. then had the window capped and sealed  
by its window contractor. G.O. then cut off the Big O pipe in the window well so  
that the flooding would not happen again. He also testified that he installed the  
carpeting on June 14, 2017.  
[72] Well before the scheduled conciliation, M.R. expressed concerns to G.O. over the  
potential for mould in the basement. After he came to believe that G.O. did not  
share this apprehension, M.R. telephoned Tarion to inquire whether it would be  
appropriate to open the walls in the affected areas to check for mould. He stated  
that he did not receive a straight answer to this inquiry or recall with whom he  
spoke. At the hearing, he testified that the person on the other end of the call had  
replied with some hesitation that this was not something that he could not do.  
[73] As the unknown declarant did not testify at the hearing, his or her statement to  
M.R. was hearsay. The essential defining features of hearsay are an out-of-court  
statement adduced to prove the truth of its contents in the absence of a  
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contemporaneous opportunity to cross-examine the declarant. The unknown  
declarant apparently never attended at the house and the parameters of M.R.’s  
query to prompt this alleged response were not disclosed. The statement was  
also not reduced to writing.  
[74] The function of the trier of fact is to guard against undue reliance on hearsay  
evidence which is unnecessary or the reliability of which is neither readily apparent  
from the trustworthiness of its contents nor capable of being meaningfully tested at  
the hearing.  
[75] I find that to assign this hearsay statement the same evidentiary value as direct  
testimony without allowing the other representatives any means of cross  
examining the declarant on the basis of his or her statement or qualifications to  
provide it would be unduly prejudicial under the circumstances. While subsection  
15(1) of the SPPA permits admission of unsworn hearsay statements and allows  
the adjudicator to assign it the appropriate probative weight, for the evidentiary  
concerns I have outlined above, I would assign this evidence substantially reduced  
probative weight.  
[76] M.R. advised G.O. that he intended to open the basement wall himself and if he  
found no mould, he would bear the expense of repairing the damaged drywall.  
G.O. agreed that if mould was found behind the drywall, O.F.H. would compensate  
him for the cost to restore the opened wall. M.R. stated that he found a substantial  
amount of mould in both of the two areas where he removed the drywall, in some  
places from the floor to the ceiling; in others as high as two feet and “all over the  
baseboards.” G.O. agreed that there was mould on the removed drywall as M.R.  
showed him the discarded sheets. As a result, and pursuant to their agreement,  
O.F.H. paid for the new drywall to be installed.  
[77] M.R. stated that G.O. proposed replacing the removed drywall in approximately  
two to three weeks and then begin the mudding. However, he was not confident in  
O.F.H.’s mould remediation expertise and suspected that the wood inside the wall  
was still wet. As a result, he postponed installation of the new drywall for  
approximately four months.  
[78] In the interim, M.R. hired EXP Services Inc. (‘EXP’) to conduct air quality tests on  
August 22, 2017 despite the pending conciliation three months later. He explained  
that he did so to mitigate the damage to the house due to concerns over the  
possibility of mould spreading to the rest of the house. However, he did not  
explain why he directed G.O. to replace the drywall before ensuring that any  
mould issues within the wall had been resolved.  
[79] While he stated that some of EXP’s tests revealed readings of 25% moisture and  
the company collected samples, their data was not explained as the Appellants  
opted not to call the author of the submitted report from EXP to offer expert  
evidence with respect to the methods and procedures used or to explain their  
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results. M.R. did not claim any expertise to interpret or explain the contents of the  
report himself.  
[80] Nonetheless, it is worth noting that according to the EXP report, the scope of that  
company’s investigation was a mould and moisture investigation with visual  
reviews of parts of the house with air sampling, all of which was conducted on  
August 22, 2017. The resulting report, dated September 13, 2018, did not state  
who had conducted the remedial work as of the date of their inspection. However,  
it concluded with a recommendation that the homeowners “retain the services of a  
mould abatement company to clean and disinfect the Basement Office and have  
the area resampled to ensure that the concentrations of interior mould spores are  
generally lower inside of the house when compared to the exterior environment of  
the building.”  
[81] When asked why he chose not to follow this recommendation, M.R. stated that this  
should have been properly O.F.H.’s responsibility, not his. He also could not recall  
when or even if he sent this report to Tarion to keep the Respondent informed with  
respect to developments on the issues raised in his 30-Day Form. While he  
testified that had “attempted” to provide a copy of the report to O.F.H., he offered  
no explanation for his failure to do so, particularly as both parties’ contact  
information remained consistent throughout this period and thereafter.  
[82] Shortly thereafter, M.R. finally contacted G.O. to replace the drywall. At M.R.’s  
request, in September 2017, G.O., installed the new drywall and applied the first  
coat of paint. G.O. emphasized that the replacement materials installed in the  
basement were new. He also explained that when drywall is delivered to a house,  
it is stored on blocks off the floor surface and installed promptly thereafter. In the  
present case, there was no evidence to suggest materials used to construct the  
basement wall were exposed to saturation or contaminants prior installation.  
The 2017 Conciliation  
[83] R.S. has been employed by Tarion since early 2014, starting as a warranty  
services representative in the freehold division and moving to another department  
in February, 2018. He completed Building Code training for a B.C.I.N. and is  
qualified under Part 9 of the Building Code. When he was still assigned to the  
freehold division, he conducted conciliations, contacted homeowners, issued  
reports and settled claims and related duties. He estimated that he conducted  
approximately two to three conciliations per week.  
[84] He conducted the conciliation with M.R. with respect to the Appellants’ 30-Day  
Form on November 20, 2017. He estimated that the conciliation was  
approximately three to four hours in duration. R.S. recalled that while both  
Appellants attended the conciliation, G.O. was not present.  
[85] R.S. testified that when he inspected the basement office during the conciliation  
inspection, most of the old drywall had already been removed and replaced with  
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new sheets, as confirmed by photographs he took during his inspection. He felt  
the carpeting for moisture but found none. M.R. advised him that there had been  
a flood caused by grading issues while the house was under construction and that  
there had been a recurrence of water penetration prior to the inspection. From this  
conversation, R.S. was led to believe that the removal and replacement of the  
drywall had been a collaborative effort between M.R. and O.F.H. He observed no  
indications of mould, though acknowledged that he could not confirm whether  
there was any mould behind the new drywall.  
[86] M.R. also directed R.S. to the basement wall opposite to the office where the  
fireplace had been installed. The wall was open, with some insulation partially  
pulled out of the cavity where the drywall had been removed. Although M.R.  
informed him that there had been water penetration in this area, R.S. detected no  
signs of a leak. M.R. advised that because he was not confident in G.O.’s work,  
he did not want O.F.H. to close up the opened wall. Given the near freezing  
temperature outside, R.S. opted not to conduct a water test for this area and the  
item was therefore not assessed in his report. He advised M.R. that Tarion would  
return in the spring to conduct the water test.  
[87] M.R. did not provide the EXP report to Tarion in advance of the conciliation. R.S.  
recalled that M.R. advised that he had the report and would email to him later,  
which he did on November 29, 2017. After he received and reviewed the report  
and a number of photographs emailed by M.R., R.S. consulted with a mould  
remediation specialist and issued his report. The mould specialist advised that  
there was no further need to test for mould as the affected materials had been  
removed:  
At the request of the Tarion representative the report was reviewed by  
a professional with credentials in mould assessment and remediation.  
Based on the test results and findings in the report provided by the  
homeowner, the levels of mould in the home were considered to be  
moderately elevated at the time the samples were taken. As the  
affected drywall has been removed, it is the opinion of the mould  
professional that no further mould testing is necessary at this time.  
[88] While the mould specialist did not testify at the hearing, his or her statement to  
R.S. was not tendered for the truth of its contents, but rather as a statement upon  
which R.S. relied in his analysis. However, the salient point is that because of  
M.R.’s fait accompli in replacing the affected materials, the issue of further testing  
was rendered moot.  
[89] R.S. issued his W.A.R. on January 5, 2018. With respect to M.R.’s assertion that  
an air quality test was required, in his report R.S. considered the contents of the  
EXP report and the assessment of the mould specialist and denied this item as he  
detected no visible mould during his inspection. He noted that he expected that  
the builder would normally be responsible for repairs as described above and  
advised the Appellants to contact Tarion if this did not occur. Since the mould  
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issue appeared resolved, but the building finishes were incomplete, R.S.  
warranted Item 7 so that O.F.H. would be responsible for restoring all interior  
finishes to their original condition.  
[90] During this same period, M.R. chose not to advise Tarion that his relationship with  
O.F.H. had deteriorated or that he was experiencing ongoing difficulties contacting  
G.O. He also contracted with a number of third parties to conduct work on the  
property and generated his own accounting of expenses for tasks he had  
unilaterally initiated for prospective compensation with his own hourly rate of  
labour, none of which he communicated to Tarion. In an email sent to D.K., an  
employee with Warranty Services at Tarion, on November 21, 2017, after the  
conciliation, M.R. stated the following comparatively cheerful assessment of his  
experience working with G.O.:  
I just want to be clear here that Gord and I speak regularly and the  
wheels are in motion to have these tasks completed, yes some of it will  
have to be done next year to it being seasonal however I am patient.  
When going through the process there is a statement that it says if you  
do not respond then all matters are considered settled, and this is why  
I have requested an appointment, this far I have had no issues with  
Gord and he has been a pleasure to deal with.  
[91] When asked about why this contemporaneous statement appears to contradict his  
testimony at the hearing, he explained that he was attempting to “build a bridge” to  
keep all parties happy and was reluctant to bother O.F.H. as G.O. had expressed  
some displeasure at the sheer number of unresolved items on the 30-Day Form  
and the statutory $1,000.00 cost to his company for each conciliation. At the  
hearing, G.O. agreed that he had been “upset” with M.R. over M.R.’s request for  
Tarion’s intervention and the resulting fees since he believed that it was “not  
necessary to go down that road.”  
[92] Through early 2018, M.R. nonetheless offered a positive and harmonious portrait  
of the ongoing progress on the outstanding items to Tarion, with emails sent on  
February 16, 2018 confirming that issues were being addressed and that he was  
working with O.F.H. to resolve further items in May, 2018.  
[93] At the very least, the above email and similar communications would have misled  
Tarion to the reasonable belief that there were no serious conflicts with the builder  
that may require intervention. M.R. also repeatedly insisted that his recollections  
at the hearing were more accurate and reliable that his contemporaneous recall  
over four years earlier without any explanation for this seemingly illogical claim.  
The First Year Form and 2018 Conciliation  
[94] On April 9, 2018, the Appellants filed their Year End Form, the receipt for which  
was acknowledged by Tarion the following day. Despite the apparent resolution in  
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the W.A.R. issued on January 5, 2018, on April 9, 2018, Item #12 in that form  
included a brief description of the then state of the drywall in the basement office:  
The office had flooded twice from the window well filling, as a result  
mold was located, wall need another coat of compound & paint  
[95] T.S. has worked for Tarion for almost twenty-one years. While at the time of the  
hearing, he was employed in a new capacity, in 2018, he remained a warranty  
service representative and had taken carriage of the Appellants’ file after R.S. was  
transferred to his new position. He also completed the examination for Section 9  
of the Building Code and is registered as an independent designer.  
[96] On June 4, 2018, T.S. attended at the property to conduct a conciliation inspection  
with respect to the First Year Form. Once again, G.O. was absent, but T.S.  
testified that he had no idea why.  
[97] Although Tarion intended to conduct a water test during this meeting, M.R. agreed  
that he had indicated to Tarion that such a test was not necessary. T.S. recalled  
that M.R. met him at the door on June 4, 2018 and informed him that he would  
work with the builder and that the water test was not necessary at that time. M.R.  
testified that the scheduled test would have related to water penetration on the  
other side of the house, an unrelated issue that had been resolved. He repeatedly  
maintained that the June 4, 2018 test was not intended to address the water leaks  
from the window well area, an interpretation apparently shared by R.S. However,  
since the issues in the basement office had been included in the conciliation  
inspection, T.S. advised M.R. that if any outstanding issues were not resolved, he  
could request another conciliation. provided that such a request was made by  
September 10, 2018. No request for this conciliation was made.  
[98] Despite some disagreement with respect to the dates of specific events, the  
parties agreed that the repairs to the basement were completed by July, 2019.  
However, shortly thereafter, M.R. testified that he noticed black spots that he  
believed to be mould recurring in the same areas as mould had been found  
previously. As a result, he included these issues in the Second Year Form.  
The Second Year Form and 2019 Conciliation  
[99] On April 11, 2019, M.R. submitted the Second Year Form. Although Item 1-4 of  
the Outstanding Items contained a description that indicated that damage in the  
basement had been caused by a “leak that was never found,” M.R. explained at  
the hearing this notation was intended to convey that the source of the leak had  
yet to be confirmed as of that date. The Appellants then requested a conciliation  
with respect to this form.  
[100] M.R., T.S. and G.O. attended the October 9, 2019 conciliation inspection at the  
property. M.R. showed T.S. the dark staining along the bottom of a baseboard in  
the basement, on the office wall under the window and on the cold room door and  
advised him that this substance was mould. T.S. testified that the spots were quite  
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minor in size and advised M.R. that he could simply wipe them away. He detected  
no evidence of a water leak inside the cold room itself or moisture in the carpeting.  
He also found no further evidence of mould on the baseboards in the basement.  
He expressed confidence in this assessment as he removed the baseboards and  
found no signs of moisture on their surface or on the wall behind them; there was  
also dry dust from drywall on these surfaces and noted that this material would  
have been damp or clumped if there had been water penetration. Similarly, G.O.  
testified that he also observed no signs of water penetration during this inspection  
and also noted the presence of dry powdered dust from the drywall on the flooring,  
indicating an absence of moisture.  
[101] T.S. did not conduct more intrusive investigations of the interior of the walls as  
warranty service representatives typically do not engage in demolition work. As  
well, there would have been no basis for such an investigation as the Appellants  
had not alleged any damage to the internal structure of the walls in their Second  
Year Form.  
[102] T.S. recalled that M.R. reported no flooding since the original events around the  
time of occupancy in 2017. He was not aware of any indication of repeated  
flooding in the same area of the basement. He authored the Decision Letter of  
November 7, 2019 that forms the basis of the present appeal.  
The Element Report  
[103] Despite M.R.’s stated dissatisfaction with T.S.’s advice regarding removal of the  
spotting on the wall, as noted above, he did not retain another company to  
remediate the mould issue as recommended by EXP. However, in the fall of 2020,  
the Appellants retained Element Forensic Engineering (‘Element’) to attend at the  
property and conduct an investigation into the problem. According to their report,  
issued on November 25, 2020, the scope of the resulting investigation was as  
follows:  
Element Forensic Engineering was retained to conduct an independent  
engineering assessment of water and resulting mould damage that  
occurred from water intrusion within the building located at the above  
noted address. Our office was tasked to comment on the current  
conditions in relation to the moisture damage.  
[104] Again, the Appellants opted not to call either of the authors of this report to testify  
at the hearing with respect to their observations or conclusions. The absence of  
direct expert testimony and the opportunity for cross-examination undermined the  
reliability of the evidence offered in the report. Significantly, the other  
representatives were unable to explore the effect to which M.R.’s apparent  
dictation of the origins of the moisture as fact may have biased the investigators’  
conclusions. For instance, under the heading ‘Observations and Discussion,’ the  
authors described some of the information upon which they based their report:  
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It was reported that moisture damage resulting from water ingress  
through the building envelope had occurred on various dates, at  
multiple locations, including, but limited to, the window well along the  
west elevation, the fireplace exhaust along the east elevation, and the  
west garage elevation. It was further reported that, prior to our  
attendance, the building deficiencies, which led to the water ingress  
had been addressed.  
[105] M.R. confirmed that he was the source of this information. While Element  
determined a cause for the mould, specifically, “improper abatement, ongoing  
water ingress, or a combination of the two,” it fell short of offering an independently  
confirmed explanation for the source of the water that may have fed it. While  
M.R. insisted that the report provided this information under the above passage,  
on his own evidence, this section simply reiterated his own opinion given to the  
investigators as a starting point for their analysis and this hypothesis was never  
tested or confirmed in the body of the report. As with the report provided by  
RJeneration discussed below, I find that on the balance of probabilities, M.R.’s  
own exercise of control over the parameters of the Element investigation served to  
diminish the reliability of its conclusions.  
[106] In their conclusion to the report, the engineers confirmed that they never identified  
the source of the water ingress:  
We recommend any ongoing, if present, underlying deficiencies that  
lead to water intrusion be identified, addressed, and rectified. This  
report represents an opinion based on the information available at the  
time of our attendance. Within moisture damaged buildings, the  
possibility of changing conditions and the potential of hidden mould  
may exist. All work to remediate moisture damaged materials should  
be completed by a restorer that has been adequately trained and  
experienced in completing work of this nature. Should additional  
evidence become available, Element Forensic Engineering reserves  
the right to review said information and provide further comment.  
[107] Once again, the Appellants opted not to follow the above recommendations, retain  
profession mould remediation services. M.R. acknowledged that as of the date of  
the present hearing, no “adequately trained and experienced” restorer had been  
retained to remediate the mould in the house.  
The Safetech Mould and Water Damage Report  
[108] J.M. is a senior project manager employed by Safetech Environmental Ltd.  
(‘Safetech’), an environmental consulting firm. He has been an occupational  
hygienist for approximately fifteen years, focussing on mould investigations as well  
as hazardous materials such as asbestos. He received a Bachelor of Science in  
environmental biology from the University of Guelph. After that, he attended at  
Conestoga College for a post graduate certificate in environmental engineering  
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applications and a continuing education certificate in occupational health and  
safety. Since joining Safetech in 2014, he has performed assessments for water  
damage and mould associated with catastrophic events. While he has been  
trained in mould remediation techniques, he does not have practical experience  
conducting mould remediation himself. J.M. was qualified as an expert witness.  
[109] On January 28, 2021, at Tarion’s request, Safetech performed an assessment for  
mould growth and water damage at the property. Both M.R. and T.S. were  
present, but G.O. was not. J.M.’s inspection lasted “a few hours,” but was limited  
to the basement office area and a section of the hallway leading from the  
basement office to the furnace room.  
[110] He testified that he observed some staining that indicated that water had been  
present at some time. He also found mould growth in both the basement office  
and in the hallway on the drywall and the baseboards.  
[111] As part of his investigation, he conducted a peer review of the Element report. He  
stated that in terms of the locations of mould growth in the house and  
recommendations to remediate, the Element report was in line with his own  
findings at the site. However, he noted that the Element investigators came to  
certain conclusions without providing sufficient data in their report. For instance, in  
the Element report, the authors offered the following conclusion:  
Based on the available evidence to date, including our visual  
assessment and laboratory results, the mould present at the time of  
our attendance was a result of improper abatement, ongoing water  
ingress, or a combination of the two. Based on this information, we  
recommend the areas of concern be adequately exposed to conduct a  
more comprehensive assessment.  
[112] However, in his report, J.M. detailed how Element did not conduct a sufficient  
assessment to confirm that there was an ongoing water ingress. As noted on the  
first page of the Element report, the scope of their investigation was limited to  
reported moisture damage without a comprehensive assessment of the building  
and therefore, they conducted no tests to determine if water ingress remained an  
ongoing factor. As noted above, they simply accepted ongoing water ingress as  
fact, based upon M.R.’s description of problems with the house, thereby allowing  
this unproven theory to serve as a foundation for their ultimate conclusions.  
[113] In terms of his specific steps taken during his own investigation, J.M. took air  
samples from the basement, then commenced a more thorough study of the  
mould growth as he found it in the office on the drywall, on the baseboard and in  
the hallway. He used a moisture meter to collect readings of the drywall, the  
baseboard and the carpet to determine if anything was wet on the date of the  
inspection. Nothing was found wet at that time. He also took readings of humidity  
and relative temperature, determining that the conditions in the investigated areas  
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were not sufficiently humid to create a condition in which mould would  
spontaneously grow. Specifically, he stated in his report as follows:  
Psychrometric readings within the basement indicated that  
temperature and relative humidity were within recommended ranges.  
Temperature was measured to be 21.5° C and the relative humidity  
was measured to be 41.3%. Mould growth may occur on surfaces  
when relative humidity in the air is >60%.  
[114] He explained that at levels of relative humidity greater than approximately 60%,  
there is a risk that the moisture in the air will be enough water that the pressure  
will push condensed water onto the drywall itself and this will be sufficient to cause  
mould growth. Below this threshold, this process is very unlikely to occur.  
[115] He cut out a portion of the drywall below the basement office window as this area  
may have been the source of the issue and discovered a minor amount of staining  
on the foundation wall. He noted that this staining was consistent with water  
entering the building at some time. While M.R. advised him of the flood the day  
before the closing, he found that the staining observed did not in and of itself  
indicate it was the product of that event or ongoing water entry. He also stated  
that this staining was likely caused by wicking from below.  
[116] He ultimately concluded that there was evidence of moisture and mould growth in  
the areas investigated. However, he was unable to determine a direct cause for  
the mould growth as of the date of the inspection, given the absence of any  
evidence of ongoing moisture penetration. As he stated in his report:  
Mould requires a source of food and moisture in order to grow  
(amplify). It is therefore understood that a sufficient amount of moisture  
was present in the areas where mould growth was observed, at some  
point. However, during our assessment, all moisture measurements  
indicated that building materials were dry. As such, moisture  
measurements could not be utilized to trace the source of moisture.  
Furthermore, visual assessment of structural components, such as the  
foundation wall, concrete slab, and wood framing did not show  
evidence of repeated or ongoing wetting, though they did contain  
moisture staining consistent with a single wetting event, such as the  
water infiltration event reported during construction in 2017.  
[117] J.M. explained that drywall provides an excellent food source for mould as it  
contains paper, binding and gypsum and therefore it is very susceptible to mould  
growth, provided that sufficient moisture is also present. However, the only water  
penetration reported to him was M.R.’s description of the 2017 flood. J.M. recalled  
that M.R. had also shown him photographs, presumably of the aftermath of this  
flood. Although the Appellants’ counsel questioned J.M. with respect to some of  
these images at the hearing, as none of this evidence was authenticated though  
witness testimony, there was no evidence presented with respect to when the  
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images were created. Even if J.M. had speculated on whether the water depicted  
in the photographs would have been sufficient to cause mould growth, such  
speculation would carry virtually no probative weight.  
[118] Safetech ultimately found mould growth in the same locations as the investigators  
for Element. However, while the Element report did not provide any moisture  
measurements or identify any previous abatement methods, it concluded that  
ongoing water damage and improper abatement was the cause of the mould  
growth. As a result, J.M. determined that the conclusions that Element drew in  
their report were not supported by the evidence in that same report.  
[119] With respect to the Appellants’ theory that rushed replacement of the drywall had  
instigated the mould growth, J.M. offered a detailed and balanced assessment:  
The theory that mould growth may have been caused by installing  
materials too soon after the original water loss in 2017, without proper  
drying is supported by the report of aged mould growth, the location of  
identified mould growth along the path of water migration for that event  
(i.e. the west wall of the office and the wall adjacent to the furnace room),  
and the lack of reported moisture losses since then. However, the  
timeline of events is not entirely consistent with that theory since the loss  
happened in 2017, and materials present at that time were removed and  
replaced by new materials which were reported to be finished in 2019.  
The building materials present after the loss would not have retained  
sufficient moisture for that length of time.  
[120] It is also worth noting that, unlike the Element report, J.M.’s summary of his  
conversation M.R. was included simply as one of many sources of information  
rather than as the factual underpinning for his conclusions.  
[121] After J.M. completed his assessment, he could not conclusively determine the  
source of the water and in turn the resulting mould growth. He therefore  
recommended that a building envelope assessment be completed to determine if  
moisture was indeed continuing to infiltrate the building, thereby explaining the  
mould growth. He recommended level 2 mould remediation protocols pursuant to  
the Environmental Abatement Council of Ontario, which refers to levels of between  
one and ten square meters of mould growth.  
The Safetech Limited Moisture Assessment  
[122] To that end, Safetech returned to the property six months later at Tarion’s request  
to conduct a Limited Moisture Assessment. The resulting report, dated June 25,  
2021, was prepared by project manager and engineer, Taylor Porter (‘T.P.’) and  
engineer in training, A.S. A.S. testified at the hearing with respect to the findings  
of their investigation and Safetech’s recommendations.  
[123] A.S. graduated from Carlton University in 2016 with a bachelor’s degree in Civil  
Engineering with a major in structural engineering. His eight-month co-op  
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placement involved overseeing renovations to the CN Tower, while also designing  
condominiums and other dwellings for clients. He also worked at Polar Racking, in  
charge of designing the solar racking for multiple projects, including rooftops and  
ground pile systems, along with the related wind tunnel study analysis for these  
structures.  
[124] Under the supervision of T.P. at Safetech, he has served as a project manager  
writing building science reports in relation to moisture infiltrations and building  
envelope deficiencies in residential, commercial and mixed-use structures.  
Essentially, his job was to study how and why moisture was entering a structure,  
what the scope of the entry was and how it affected the structure, particularly in  
terms of the useful life of the area. These investigations involved completing  
building envelope reviews and designs in order to resolve various moisture  
infiltration scenarios.  
[125] His professional engineering designation has been delayed by restrictions related  
to the ongoing COVID-19 pandemic; however, he has completed all required  
examinations and, as of the hearing, his designation was in the final review phase.  
A.S. was qualified as an expert.  
[126] A.S. and T.P. attended at the property on June 7, 2021; M.R., G.O. and an  
engineer from Element were present. They were directed to the basement where  
M.R. expressed his moisture concerns. Specifically, M.R. identified the exterior  
window well as a potential source of leaks. On the interior, they discovered that  
the baseboards had already been removed prior to their arrival. A.S. observed  
discolorations on the baseboards and suspected that it may be mould; however,  
he did not voice this theory as he is not an expert in mould.  
[127] Prior to water testing, he measured the moisture readings. To the right of the  
interior window, he used a protimeter probe, used for cellulose structures such as  
drywall, to take a measurement of 12%, which he explained was indicative of a  
‘dry’ condition. A second reading taken along the same wall yielded a reading of  
16%, which indicated an ‘at risk’ condition. They also noted a pre-existing hole  
under the window but could not comment on how long this opening had been  
present. A.S. also used a Tramex moisture meter, for measuring moisture in  
concrete, to obtain a reading of 3.5% on the foundation wall, representing a ‘dry’  
condition. He explained that any reading below 5.0% or 5.5% for concrete  
represents dry conditions.  
[128] He and T.P. then returned to the exterior of the house and examined the window  
well, confirming that it included a drain and that it was covered with a sock. Upon  
examining the structure of the window, they discovered that the sealant was  
delaminating or missing in various points around the window and was in very poor  
condition. They also noted moisture staining along the weeping holes of the  
window itself. On the inside of the window, moisture staining was evident along  
the track. This was significant as they had not yet conducted the water test and  
there had been no precipitation that day.  
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[129] When they conducted the water test, they stood approximately 1.0 to 1.5 meters  
from the dwelling to simulate wind driven rain, not striking the window directly, but  
instead aiming the hose at the area above the window. Only four minutes into the  
test, they stopped the water flow as they could observe water pooling directly  
above the drain and entering the dwelling. After the water was stopped, A.S.  
observed water in the lower track of the window, confirming that the water had  
penetrated the window; he also noted the track was in poor condition and had not  
been cleaned.  
[130] While water tests typically involve ten minutes of spraying, they ended the test  
early to avoid damaging the inside of the dwelling. In the Safetech report, he  
stated that “the window well drain was observed to provide poor drainage  
indicating potential blockage of the drain.” Had they continued the test past four  
minutes, they may have determined to what extent the window drain was  
functioning or not; however, continuation would have risked permanent damage to  
the basement interior. As a result, A.S. was able to determine that the water  
pooled on top of the drain as its path was blocked by something unidentified.  
Although he could not state for a certainty that the drain was obstructed, in his  
opinion, this was likely. When asked about the cause of the blockage, he opined  
that such an obstruction may have been caused by a buildup of silt or clay or  
perhaps the consequence of cleaning issues. He acknowledged that he did not  
use a camera or any other device to examine the interior of the drain.  
[131] He then asked G.O. to enlarge the opening below the window to examine the wall  
cavity. They removed the insulation and the Tyvek moisture barrier was cut to  
observe the condition of the concrete foundation wall. They observed that water  
had clearly entered the dwelling as confirmed in the related photograph in the  
report. There was also water from the test coming down the face of the concrete  
foundation wall. Readings on the Tramex meter indicated increased wet  
conditions at 5.7%. The moisture on the foundation wall would not normally affect  
the humidity in the rest of the house as the wall would have been sealed with  
moisture barrier and drywall. There was also evidence of historical water staining  
replicated by the four minute water test. A.S. noted that there was a colour  
difference between the older staining and the new marks, though there was no  
means of determining when the older stains were created. Historic moisture  
staining also does not offer information on the frequency of past water penetration.  
[132] Ultimately, Safetech found the following with respect to the source of the water in  
the basement office, with reference to the photographic evidence in the report:  
Figure A8 identifies deficient/deteriorated caulking along the north  
western basement window and is suspect of facilitating moisture  
ingress during wind driven precipitation events. Furthermore, the sheet  
metal frame around the window appeared to be poorly assembled and  
poorly detailed to prevent intrusion at the sill’s corners.  
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[133] Fortunately, they found no evidence of cracks in the foundation. Rather, the water  
had travelled through the underside of the window and along the face of the  
concrete foundation wall. Although they determined that the water had entered  
through the bottom of the window, A.S. observed that the caulking on all four sides  
of the window was in poor condition. He added that the ingress would likely only  
occur during wind driven precipitation since the rain would not have struck the  
window well area without wind to force it into this area.  
[134] They also removed and examined the baseboard trim in the hallway. According to  
their report, the moisture staining observed was the result of poor water  
remediation practices, specifically the minimal work done by G.O. to clean up the  
original pooled flood in April 2017:  
The building disclosed during the on-site interview that the baseboards  
and 12” of the lower drywall were removed within the basement office  
subsequent to the closing day (April 2017) of the dwelling. Water that  
had penetrated the window and observed on the basement floor was  
mopped and squeegeed into the furnace floor drain. A single air mover  
was noted to be utilized in an attempt to dry out the building materials.  
Furthermore, it was noted that the baseboards leading to the furnace  
room removed during the water restoration efforts, however the drywall  
was not removed. The baseboards were then installed and painted,  
prior to confirming the sill plate and insulation behind the drywall in the  
area were dry. The moisture staining observed upon the removal of the  
baseboards in the hallway (Figure A19) are, in our opinion, a result of  
poor water remediation practices.  
[135] Although the opposite southeastern side of the basement was not a concern for  
the investigation, M.R. asked them to examine this area. Moisture readings taken  
in this area indicated dry conditions. The entire investigation lasted approximately  
three hours after their arrival at 9:00 a.m.  
The December 2021 Home Inspection  
[136] J.B. originally worked in construction with his family’s firm over forty years ago,  
involving both residential and commercial renovation projects. In 1993, he  
obtained a B.A. in International Development and Environmental Studies from the  
University of Guelph. On the strength of that degree and his past construction  
experience, he was hired by GreenSaver in 1993. He was eventually trained as  
an Energuide advisor, delivering and coordinating energy and water conservation  
strategies in residential and high-density residential settings, training inspectors to  
do the same. He eventually established his own home inspection business  
twenty-five years ago. He was also trained with the Durham College Equivalency  
in 1997 through GreenSaver.  
[137] Since then, he has conducted over 7,000 home inspections. He also had a fifteen  
month tenure with Mike Holmes Inspections doing the “Holmes Approved Homes”  
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stages of construction inspections with Empire Builders and Mason Homes. He is  
presently on the education programs committee of the Ontario Association of  
Home Inspectors and serves as a director of the Board of Directors for that  
organization.  
[138] He has been hired by homeowners at the 30-Day and subsequent intervals, but  
not for Tarion. He does not hold a Building Code designation. With that  
qualification, he was qualified as an expert.  
[139] At the request of the counsel for O.F.H., he was asked to attend at the Appellants’  
house and to inspect and identify defects in the interior basement hallway, office  
and the exterior roof and cladding at the front door entrance and provide an  
opinion regarding remediation. Although the name of O.F.H.’s counsel appears on  
his report, he clarified that he authored the entire contents of the report and  
included Mr. Raikes’ name strictly as the retaining client responsible for its receipt.  
Unlike the situation with R.P., J.B. clarified that counsel for O.F.H. was not  
involved in the drafting of the report.  
[140] He testified that his report represents a “holistic device” reflecting his inspection of  
each of the items investigated. He followed the Ontario Home Inspectors’  
Standards of Practice and used Home Gauge Inspection Software.  
[141] On December 22, 2021, J.B. attended at the property and performed moisture  
tests in the basement and checked humidity levels, obtaining a reading of 59%  
relative humidity, which he characterized as higher than recommended for  
residential dwellings.  
[142] He also noticed repairs to the basement that had not been fully completed and  
observed some lumber with black speckling apparent on its surface, as well as  
some white powdery material on a removed baseboard. He could not offer an  
expert opinion on the identity of these substances as he is not an expert on mould  
remediation and environmental concerns are beyond the scope of a home  
inspector’s practice. While he can send samples for laboratory analysis and offer  
clients advice with respect to air quality remediation strategies based in part on the  
results of such analyses, he was no aware of any testing performed in the present  
instance. He also did conduct any destructive investigation to identify any  
concerns behind the walls.  
Roof and Exterior Cladding Issue  
[143] M.R. testified that from the time that he and L.R. took possession of the house,  
they observed water running down the side of the brick near the front door. At the  
hearing, he described this as a defect with drainage and the flashing on the roof  
and cited numerous provisions of the Building Code for the related deficiencies.  
However, as noted above, the only defect cited in his Notice of Appeal related to  
the flashing.  
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[144] He agreed that O.F.H. installed gutter protection grills through its subcontracted  
siding company. He testified that the water penetration had nonetheless occurred  
on both sides of the doorway, although his photographic evidence included images  
of staining only on the garage side. He stated that the effects of the water  
penetration became visible only after approximately one hour of rainfall. This  
precipitation need not be a torrential downpour, but could be a “regular rain” or  
even a mere drizzle. He speculated that the water was entering the building  
envelope and went somewhere within the structure before eventually finding its  
way out.  
The 2019 Conciliation  
[145] Prior to the October 2019 conciliation inspection, G.O. went up on a ladder, lifted  
up the flashing and applied a bead of silicone down the face so that if any water  
was entering under the flashing, it would collide with the silicone and be redirected  
down towards the eavestroughs. He denied that the material used was  
construction adhesive as M.R. alleged and stated that the clear silicone would not  
break down like construction adhesive and would instead stick to both the shingles  
and the flashing. He acknowledged that he did not return to re-examine the  
flashing to confirm that the silicone repair remained in place.  
[146] M.R.’s skepticism over the efficacy of G.O.’s repair was in part because G.O. did  
not perform an inspection of the roof before applying the adhesive material as a  
solution. Also, neither G.O. nor T.S. used a ladder to go onto the roof on the day  
of the inspection, with T.S. unhesitatingly accepting G.O.’s solution as sufficient.  
M.R. nonetheless speculated that sealing the flashing could not have resolved the  
issue since the water was emerging from underneath the soffit and down the brick,  
leading him to conclude that the source of the leak must be at the top of the brick  
wall and therefore must be leaking down both sides of the wall on both sides of the  
entrance.  
[147] In his report, dated October 14, 2019, T.S. made the following finding with respect  
to warrantability:  
Tarion Construction Performance Guideline 5.4 indicates roof flashings  
shall prevent leaks into the home. The condition reported is that water  
runs off the edge of the roof and runs down the brick wall. No leaks  
were reported inside the garage.  
There is no defect in the exterior cladding of the home resulting in  
detachment, displacement or physical deterioration and, therefore, no  
breach of the Two-Year Cladding or Water Penetration Warranties.  
[Italics in original]  
[148] T.S. testified that he did not enter or inspect the garage as he was not made  
aware of any openings in this area. In addition, G.S. did not test the other side of  
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the house as there was no allegation of leaks on this part of the house. G.O.  
testified that it was not raining on the date of this inspection.  
[149] With respect to the Construction Performance Guidelines referenced above, T.S.  
explained that these serve as informational policies on common construction  
conditions that Tarion has observed in claims from homeowners and the  
expectations involved in those particular conditions. They set out what may be  
deemed a warranted condition as well as observable and measurable factors  
related to these conditions. For instance, described physical conditions may  
indicate the difference between water accumulation and the visual signs of water  
penetration through such evidence as water staining in basements.  
[150] While T.S. was not personally involved in the creation of these Guidelines, he  
testified that Tarion had consulted with stakeholder industry organizations such as  
roofing associations and building code experts to arrive at a mutual agreement on  
the appropriate Guideline standards. Relevant to the present issue were  
involvement of the Residential Roofing Contractors Association of Greater  
Metropolitan Toronto.  
[151] While M.R. hoped to prompt a follow-up to the cladding issue by adding as an  
uncompleted item on the Second Year Form, no such follow-up occurred and  
Tarion deemed the issue unwarranted in the November 7, 2019 Decision Letter.  
By late 2019, M.R. no longer attempted to contact O.F.H. over repeated cancelled  
appointments and scheduling conflicts. He stated that he had largely given up on  
working with G.O. and had no confidence or faith in him to resolve the issues with  
the house.  
[152] He stated that Tarion instructed him to obtain two estimates to address suspected  
mould issues within the roof. When Tarion concluded that the Appellants lacked  
evidence to support this aspect of their claim, he received information that he  
should obtain a report from an engineer. At the hearing, he stated that an  
unnamed engineer informed him that such a report would not be possible without  
removing the roof to inspect the area under the roofing materials. Presumably,  
this information was provided verbally by the Element investigators when they  
attended at the house on October 28, 2020 as their report tangentially referenced  
reported water intrusions to the garage area, as quoted at paragraph 103 above.  
[153] On December 10, 2020, M.R. sent the following email to the Tribunal, T.S., his  
representative’s law firm and O.F.H.:  
Hello Parties  
Please see attached engineers report for the mold (1-2(1-3), a report  
for the exterior cladding (6-2) could not be completed without removal  
of the shingles and sheathing, a second opinion from a roofing  
contractor will be provided prior to our upcoming hearing.  
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[154] As of the hearing, the shingles and sheathing had not been removed as suggested  
to obtain confirmation of M.R.’s theory that the source of the water penetration  
originated within the roof.  
The RJeneration Report  
[155] R.P. has close to thirty years experience in the roofing industry. Although he has  
approximately eight employees, he takes all calls and prepares quotes himself.  
He testified that he attended at the Appellants’ house at least four to five times  
with inspections lasting between twenty minutes to over one hour.  
[156] Prior to R.P.’s initial inspection, M.R. instructed him to inspect the roof for  
deficiencies regarding the water that was penetrating the house and to prepare a  
quote for the cost to repair the roof. These instructions were not submitted at the  
hearing as they took the form of a telephone conversation. R.P.’s first attendance  
to the property occurred on May 4, 2020. While he inspected the roof on this visit,  
he did so from the ground without ascending onto the roof itself. R.P. returned to  
the house on three or four subsequent occasions for the same purpose. R.P.  
provided a quote on or about the second visit to the property. As a result of the  
disclaimer he had received from the engineer, the information that comprised this  
quote was later repurposed to serve as an expert opinion on water penetration into  
the roof. R.P. confirmed at the hearing that he was not approached to provide an  
expert report until November 2021.  
[157] In his report, dated February 25, 2022, R.P. took the position that the roof was  
inadequately designed to prevent water from entering the building envelope for  
several reasons.  
[158] First, the roof saddles located above the front door entrance have design  
deficiencies rendering the roof susceptible to water penetration and ice damming.  
He explained that roof saddles are required to divert water and snow from being  
trapped on or within the roof structure. If the roof saddles are too short, they will  
be ineffective in channelling rainwater and melting snow away from vertical  
structures such as a parapet wall, an element present on the Appellants’ house.  
Water may penetrate directly into the parapet as there would be nothing to deflect  
it away from the parapet wall.  
[159] He stated that the saddle above the garage should have extended several inches  
beyond the wall to prevent the water becoming trapped against the parapet wall.  
He viewed this as the result of incorrect framing, stating that the saddles should  
have been installed during the framing with the same pitch as the adjacent roof  
and extended beyond the parapet wall with metal valleys installed to divert water  
from the parapet wall. In the present assembly, the trapped moisture will  
contribute to the abnormal wear to the roof sheathing and structure.  
[160] He added that metal valleys should have been installed that rise up the parapet  
wall and under the vinyl siding and extend two inches past parapet wall. In the  
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present case, the saddles were observed to end twelve inches short and therefore  
would be ineffective in diverting the water away from the building envelope.  
[161] He testified that he observed “a lot of staining” on the brickwork and on the wood  
in the attic area above the garage, but readily acknowledged that he had not  
conducted much water testing over the course of his career. While the stained  
areas in the garage attic were dry at the time of his inspection, he believed that the  
staining represented evidence of multiple events of wetting over a period of time.  
These observations related to photographs taken on September 21, 2021 and  
included in the report.  
[162] During his second visit to the property on November 8, 2021, R.P. went onto the  
roof to conduct a closer examination of the flashing. He noted in his report that a  
missing end cap on the garage side of the roof allowed more water to flow to an  
area under the flashing. This would increase water shedding towards the area  
where the water penetration was believed to be occurring with increased velocity  
due to the steep pitch of the garage roof. He suggested that an end cap should  
have been installed with proper down pipe locations to divert the water from the  
above canopy roof away from the building envelope.  
[163] The eavestrough to the left and right of the parapet also lacked end closures,  
allowing water from the upper roof to exit the eavestrough onto the adjacent  
surface of the roof and drain down the roof directly into the parapet wall. A  
downpipe should have been installed to divert the collected water from the  
eavestrough down off the roof and away from the building envelope. Metal  
flashings would also prevent water penetration along the seams of the shingles.  
He estimated that approximately 40% of roof surface was draining into the affected  
area near the parapet wall. He stated that with so much water draining from  
second floor roof to the steeply pitched roof on the garage, a 6-inch eavestrough  
should have been installed around the garage.  
[164] M.R. recalled that all eavestroughs observed on the house were five inches in  
width, whereas in his opinion, they should have been six inches given the large  
surface area on the main roof shedding water to the eavestroughs. However, he  
cited no Building Code authority to support this preference. Similarly, although he  
described the roof pitch as “9-12” at the hearing, this figure appeared nowhere in  
the report.  
[165] He also testified that in areas that are sheltered from the sun, accumulation of  
organic growth such as algae may accelerate deterioration of the roof materials as  
the shingles will not have sufficient time to dry after precipitation. For example, in  
areas under the soffits, roofing materials may break down more quickly than in  
other areas due to organic growth. He did not however suggest that the presence  
of such sheltered areas was the result of design defects, acknowledging that it is  
not possible to control where the sun shines on the roof surface. He also did not  
propose a solution to this issue.  
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[166] R.P. testified that if the builder had built a proper saddle and with a pitch matching  
the rest of the roof, the water would have been diverted away from the building  
envelope via metal flashings. In the present case, O.F.H. used shingles in a  
“closed valley” to divert the water rather than metal valleys that would lessen the  
deterioration of the shingles, eventually resulting in their failure. He noted that no  
metal valleys had been installed on the roof. He explained that the wet areas on  
the roof evident in the photographs in the report supported his assessment that the  
water was being trapped rather that being properly diverted.  
[167] Although not mentioned in his report, at the hearing, he testified that some portion  
of the siding was removed during one or more of his inspections and that he  
observed moisture trapped inside. He testified that trapped moisture will  
eventually cause mould to accumulate and the wood will decompose, resulting in  
the failure of these areas, thereby compromising the integrity of the structure.  
[168] To resolve these issues, he stated that the shingles and the siding would have to  
be removed and the underlying structure would have to be reframed and extended  
over the parapet wall with metal flashings to divert water outside the building  
envelope. He testified that the same problems were evident on the roof on  
opposite side of the garage with water channelled directly into the parapet wall  
above the mud room. Again, he attributed the issue to improper framing and  
inadequate saddles.  
[169] With respect to G.O.’s insertion of adhesive under the flashing, he testified that a  
proper repair would have involved removing all of the flashings to determine the  
extend of water and ice intrusion and installing step flashing. He stated that here,  
the flashing was not installed correctly and was the incorrect type or size for the  
structure. He did not elaborate on how the flashing installed was improper, but  
noted that he would be able to supply and install replacements.  
[170] While he criticized the design of the house, he acknowledged that he never  
consulted the plans for the structure. Similarly, he offered no authority beyond his  
own experience and building practices for his statement that 3-4 inch saddles were  
required leading to the parapet wall.  
[171] R.P.’s third visit coincided with the water test carried out by Tarion. While R.P.  
observed this test, he was not involved in it. R.P. took the position that the water  
test preferred by Tarion in its Construction Performance Guidelines of only ten  
minutes of continuous directed flow was insufficient in duration to pinpoint a water  
leak in the structure of this house, particularly as the leak was coming down the  
side of the house. However, he conducted no water tests of his own, despite  
subscribing to M.R.’s view that Tarion’s tests were far too brief to yield reliable  
data.  
[172] RJeneration also provided a construction quote dated April 21, 2021 with respect  
to the roof. By this point in time, the Appellants had not received any expert report  
with respect to the roof. As with the quote for the window well, I find that it would  
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be reasonable for RJeneration to know the accurate scope of the work to be  
conducted to provide an accurate report. While M.R. asserted that R.P. was the  
expert, it should not be overlooked that he was originally retained only to provide a  
quote for repairs in May, 2020, information that was later repurposed in late 2021  
to serve as an expert opinion and report for the present proceedings. No invoice  
was generated for the initial attendance in May, 2020 when R.P. simply inspected  
the roof from the ground to generate a quote for repairs.  
[173] With respect to the creation of the report, M.R. acknowledged that he provided the  
photographs included, wrote the observations and typed up the final report. When  
asked under cross-examination with respect to R.P.’s actual contribution to the  
report, his response was somewhat evasive, explaining that R.P. was not  
particularly “computer savvy.” He agreed that he “dictated” the observations in the  
report to R.P. He nonetheless characterized the report as a “collaboration” and  
noted that R.P. had offered to conduct any ordered repairs to the roof as well as  
any follow-up work on the window well. Significantly, R.P. acknowledged that he  
took no notes at all during his initial inspection in May, 2020 and offered the rather  
vague explanation that his recollections were the product of multiple visits to the  
property.  
[174] With respect to images in the report of the garage ceiling, R.P. was not present  
when these photographs were taken, let alone when M.R. cut the holes in the  
ceiling depicted in the report. Since this evidence was not put to M.R. in his  
testimony, R.P.’s interpretation of the images was of limited probative value as it  
was substantially dependent on whatever M.R. had told him. Similarly, the  
Appellants’ counsel advised R.P. that a photograph under discussion depicted ice,  
though this is not readily apparent from the image and no caption accompanied  
the image. As a result, testimony that the image depicted ice damming  
represented evidence of a highly reduced probative value.  
[175] R.P. acknowledged that although M.R. took all of the photographs in the report, he  
provided the included opinions on the deficient workmanship and the necessary  
work to address the damage. Specifically, he provided his notes on a piece of  
paper to M.R. and M.R. assembled the report using a combination of both of their  
observations and some of his wording. He took no photographs of his during his  
various inspections of the property. When asked under cross-examination which  
portions of the text were the product of his notes, he was unable to answer as  
M.R. was in possession of the only copy of these notes. In the absence of these  
original notes, he was largely unable to clarify which of the observations set out in  
the report were his own versus those added by M.R.  
[176] One notable exception was the inclusion of the reference to section 9 of the  
Building Code, which he stated that both wished to include in the report. Earlier in  
his evidence, he stated that he contributed the references to the Building Code  
included in the report, but denied that he was aware of any formal training  
available in section 9 or otherwise, explaining that uses this material as a guideline  
only.  
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[177] M.R. acknowledged that he understood the basis the other parties’ concerns over  
bias in the RJeneration report, but explained that he believed that it was necessary  
“to have all of the information up front” to ensure that R.P. had all of the relevant  
facts he needed to offer an opinion, as well as to preserve some degree of  
transparency with respect to its creation. He stated that he had no prior  
relationship with RJeneration or R.P. and had found the company on the internet.  
[178] It is also worth noting that counsel for the Appellants never tendered R.P. to be  
qualified as an expert. However, this may have been simply the result of a  
procedural oversight.  
The December 2021 Home Inspector Report  
[179] J.B. also did not ascend the roof during his inspection on December 22, 2021.  
Instead, he examined the roof from the edge of a ladder, likely for the same  
weather related reasons as described in G.S.’s testimony. In his report, J.B. noted  
that the shingles and components of the northeast garage roof received little if any  
direct sunlight. As a result, he stated in his report that “ideally the shingles would  
be replaced with a modified bitumen (torched on) membrane along with wall  
cladding modifications.”  
[180] In his criticism of the roof design, he offered an assessment of the roof structure  
strikingly similar to that provided by R.P. with the respect to the potential for  
drainage problems. For instance, he observed that the closed valley design in the  
northeast part of the roof, wicking of moisture upwards below the shingles will be  
more likely than in an open valley. With the area being in virtually perpetual  
shadow, the subject area will be very vulnerable to snow and ice accumulation and  
possible ice damming through the roof or into the walls. There could be hidden  
damage which would only be detectable through disassembly of the cladding  
materials.  
[181] Furthermore, he stated in his report that given the way that it has been designed,  
the roof and adjacent walls will run a higher risk of water intrusion during extreme  
precipitation events. Water could be driven into the wall system behind the vinyl  
siding and large volumes of water may drain around the wall and spill onto the  
lower brick veneer wall or enter the garage wall system. He also took issue with  
the length of the flashing as its present configuration could lead to water  
penetrations during extreme weather. He explained that due the slope of the roof  
with its configuration of multiple surfaces converging to one location, a large  
volume of water directed to this post could be pushed up under or over the  
flashing, allowing it to enter the building.  
[182] He testified that the configuration of the roof system combined with the installation  
of the materials as assembled was problematic from his experience. While he  
described the above assembly as not proper construction, he acknowledged that it  
is currently the most common installation in the industry.  
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[183] At the hearing, he briefly outlined the following recommendations for modification  
included in his report to correct the above issues:  
It is my opinion that this triangle of roof, unseen from the ground,  
should have had either a metal roof material like that used in an open  
valley, or better, it would have had a torch applied modified bitumen  
membrane with an uninterrupted (e.g. not a step flashing) metal  
flashing with a counter flashing above it and with the wall cladding  
materials installed to within one-inch of the roof.  
1.1 (2) Where the roof meets the walls it is required that step flashing  
be installed. In spite of current design choices - where wall cladding is  
installed in direct contact with the shingles - it is still considered better  
building practice to terminate the wall finishes at least one-inch above  
the shingles. This would enable visual inspection and confirmation of  
the step flashing being present and would ease the task of shingle  
replacement in the future. A more important consideration for leaving a  
gap is that leaving a gap along the bottom edge will reduce the  
likelihood of water wicking into the spaces below and behind the  
materials either during heavy rain or in winter from snow and ice-  
damming. [Emphasis in original]  
[184] On the date of the inspection, it was not raining. J.B. also agreed that he did not  
actually observe any wicking as this is a slow and gradual process. He also did  
not lift up any of the shingles to examine the materials below as the temperature  
on December 22, 2021 was below 0°C.  
[185] Although internal damage may have been present, he could only testify to the  
elements he was able to observe and did not conduct any disassembly of the roof  
for internal examination. Nonetheless, he stated that the exterior parts of the roof,  
specifically the shingles and siding would need to be removed to determine what  
was installed underneath and reconfigure the roof in a more watertight fashion.  
[186] He also examined damage in the garage below the area where the reported  
leaking had occurred. M.R. had informed him that he had cut the access hole in  
the garage ceiling. In this area, J.B. found staining, but no water present. He did  
not know the cause of the staining, but later attributed it to the same poor design  
and assembly as the roof.  
[187] In the garage attic space and at the bottom of the adjacent wall, water damage  
was apparent and rusty bolts were visible. He testified that it was possible that  
water entering the garage attic may have travelled to the foundation below;  
however, as the house was no longer new and he did not know how long the wall  
system was open, he could not necessarily state a cause and effect relationship  
between the two observed areas of staining. He also could not speculate with  
respect to how much water could have travelled the eight to ten feet from the attic  
to the foundation of the garage.  
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[188] With respect to the flashing to the right of porch, he noted the installation of  
“counter flashing,” in other words, multiple surfaces converging and no visible step  
flashing or gap along the bottom of the siding to accommodate water. He stated  
this is incorrect and may have directed water into the wall along with the water  
directed against the wall from the adjacent roof surfaces. Out of concern for  
potential hidden damage behind the shingles and vinyl siding, he recommended  
removal of the roof and wall materials, followed by installation in the correct  
fashion.  
[189] He stated that this application of addition cladding appeared to serve no function  
other than to obscure the roofing finishes and the terminations. However, he  
described no specific harm posed by the present assembly and acknowledged that  
it may assist in shedding water from the sheltered area under the eaves.  
[190] Ultimately, he stated that given the multiple design errors, multiple trades would  
need to be engaged to remedy these issues, including a roofer, an exterior siding  
profession and possibly a carpenter. He disagreed that it would be necessary to  
rebuild both sides of the garage roof for the sake of consistency. While he did not  
determine that there were multiple and extensive issues with the roof construction,  
he did find multiple issues with exterior finish applications. However, if not  
corrected these problems could theoretically lead to future roof deterioration.  
[191] However, in his report, he denied that the leak presented any threat to structural  
integrity as there is not enough water to cause decomposition prior to the next set  
of roof shingles are ordered. Although he recommended removing the roof and  
cladding to reverse the design and assembly errors, no action was required  
specially to address the leak.  
The December 2021 Water Test  
[192] G.S. graduated from the Construction Engineering (Management) Technology  
program at Fanshawe College in 1986. He was a general contractor for twenty-  
five years specializing in disaster clean-up and restoration in buildings, mainly  
residential. Much of his experience related to intrusive water entry in basements  
and roof leaks. He has also been certified in a number of related areas such as  
mould remediation, including as a water restoration technician, which appears on  
his curriculum vitae as a master water restorer with I.I.R.C. certification in 1995.  
G.S. was qualified as an expert.  
[193] G.S. was asked by T.S. to inspect the roof and conduct a water test of the  
northeast slope of the garage roof where that part of the roof meets the siding at  
the masonry wall, otherwise termed “the valley.” He conducted this inspection on  
December 22, 2021. While this inspection was originally scheduled for  
September, M.R.’s requests for confirmation of G.S.’s qualification and his liability  
insurance, as well as general scheduling issues necessitated the delay. While  
J.B. was also present, Tarion did not ask him to provide an opinion with respect to  
the water tests.  
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[194] He explained that the water test was conducted only in the valley over the garage,  
to the left of the front door, to determine if there was any water intrusion to the  
residence. He had conducted roughly five past water tests prior to the present  
investigation. A qualified roofer, R.G., assisted with this test. Although he  
observed a hole in the interior garage ceiling, he did not cut this access and was  
not aware of who did.  
[195] The inspection began with a brief interview with M.R., who advised G.S. that water  
had been leaking through the valley and into the garage. M.R. had informed him  
of G.O.’s repair to the flashing, but that the area continued to leak into the garage.  
At that time, M.R. did not allege to him that the water leaked anywhere else.  
[196] He visually inspected the valley and the saddle area. He was not able to stand on  
the roof due to the freezing weather that day, but, like J.B., he was able to  
examine the roof from a ladder. He also inserted a ladder into the access hole in  
the garage ceiling to look for water staining, dampness and mould. He observed  
no mould but did find staining that in his experience was the result of water  
intrusion; however, the staining was not indicative of repetitive or created over a  
long period of time. Had the situation been otherwise, there would have been  
mould present, likely black in colour.  
[197] G.S. conducted two water tests, the first approximately five minutes in duration  
and the second approximately thirteen minutes. However, he observed no water  
entry into the garage or its attic area. He did not use a moisture meter and neither  
he nor R.G. were able to stand on the roof to conduct the water test. However,  
R.G. was able to apply the water directly to the valley. As he noted, often one has  
to adapt to the physical circumstances of a given site or conditions. In the present  
instance, the cold ambient temperature and the resulting likelihood of the water  
directed at the valley freezing precluded safely standing on the roof.  
[198] In his report issued on January 6, 2022, he summarized his findings as follows:  
In conclusion, the staining to the drywall and framing appears to be the  
result of water entry at some point in time. It is unknown when and how  
often the water entry occurred; however, the current condition is not  
indicative of repetitive or multiple occurrences of water entry. Further,  
no water entry was observed in those areas for the duration of our  
water test.  
[199] Although he was not asked to investigate the staining on the masonry at the front  
of the house, G.S. described this occurrence as “not abnormal.” While he  
speculated that it was the result of an overload of water from the eavestroughs, he  
could not be certain from the photograph shown to him during the hearing.  
[200] As noted above, R.P. deemed the water tests performed by G.S. inadequate.  
Specifically, he testified that the tests should have been conducted from the  
second floor roof because this would have been the source of the majority of the  
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water. During heavy rainfall events, water will flow from the roof into the lower  
portions of the roof and enter the damaged sections after striking all areas of the  
roof.  
[201] He took issue with the duration and the volume of the water as well as the height  
from which it was directed at the structure, stating the following in his report:  
The nature of this leak as described by the homeowner is that after  
rain fall of more than an hour, the leak makes its way into the garage  
above the roof along the sill and structure to the top of the brick and  
then down both sides and continues to leak for days. The inspection  
performed could not have identified the issues brought forward by the  
homeowner as the conditions created ice damming, the length of time  
was not sufficient to reproduce the leak, lastly the volume of water from  
the second-floor roof, running down a steeply pitched garage roof was  
not duplicated.  
It is in my opinion the water leak test had major flaws and would not be  
able to duplicate the homeowners’ concerns based on the location of  
the water applied and the temperature that was below the freezing  
point.  
[202] The wording of the above passage also underscores the concerns expressed by  
opposing counsel with respect to R.P.’s impartiality as the purpose of the testing in  
R.P.’s view was apparently to replicate the conditions described by M.R. rather  
than an objective assessment of possible water penetration to the structure.  
[203] However, when asked under cross-examination with respect to the appropriate  
volume of water, he replied that two inches per hour would be preferable, but  
acknowledged that he could cite no authority for this claim beyond his “gut.”  
Similarly, he could not explain why the height selected by R.S. would have failed  
to produce reliable results.  
[204] As for the duration of the test, he asserted that no less than eight hours of  
continuous flow would yield reliable results. When questioned on the basis of this  
claim, he offered no objective authority, but conceded that perhaps four hours was  
sufficient, again offering no objective authority for this assertion.  
[205] R.P. also never conducted any water tests to the house himself, explaining that he  
would require several individuals on the roof running multiple hoses to obtain  
meaningful results. He also never inspected the roof during active precipitation,  
but expressed confidence in his speculation, despite acknowledging his  
conclusions as such.  
[206] In contrast to R.P.’s vague and unsupported assertions on water tests, Tarion’s  
Construction Performance Guidelines set out detailed parameters for such  
assessments:  
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5.1 Above Grade  
Use a standard garden house and sprayer attachment. The sprayer  
attachment should be set on “shower” or similar dispersal pattern.  
Spray the area to be tested for not more than 10 minutes from a  
minimum distance of 2 m. Have another person checking inside for the  
point of origin and the length of time it takes for water to appear. Areas  
to be investigated should be kept dry prior to the test. [Emphasis in  
original]  
[207] The preamble to the above passage explained that this test is intended to simulate  
an average wind driven rainfall and therefore should not be conducted with full  
pressure single stream devices such as a pressure washer at flashings as this  
pressure can force water through building assemblies and flashings not intended  
for high pressure or high-volume water saturation. As the test was intended to  
simulate precipitation on the roof assembly, the alternative below grade test  
intended to detect foundation leaks was not applicable.  
[208] Although counsel for the Appellants repeatedly suggested that aiming the hose at  
the highest elevation of the valley could have yielded different results, G.S. was  
unshaken in his evidence that since there was only one valley area in this section  
of the roof, the area exposed to the water test was the only region that would have  
captured any water that could have entered the structure. G.S. also explained that  
since the water test is intended to replicate the effects of wind driven rain, the  
distance the hose is held from the roof is irrelevant provided that the water is  
directed at the surface. As the staining observed in the garage attic could only  
have been caused by water entering through the valley, there was no need to  
direct the water elsewhere on the roof as counsel for the Appellants suggested.  
Similarly, there was no evidence submitted to support M.R.’s speculation that the  
water entered at some distant point and travelled about under the roof’s structure  
before exiting over the garage.  
Analysis  
Water Penetration in the Basement  
[209] Despite his acknowledged awareness of the claims process and lack of difficulty in  
otherwise communicating with Tarion, M.R. opted not to consult with Tarion before  
taking unilateral steps to excavate the area outside the basement office window  
and to remove the drywall.  
[210] Although he offered extremely vague testimony with respect to having inquired  
about the advisability of undertaking such work, even on his own evidence, the  
anonymous employee contacted apparently did not offer an enthusiastic  
endorsement of his plan, instead responding with a hesitant acknowledgement  
that Tarion could not prevent M.R. from undertaking the planned work. As a  
result, on the balance of probabilities, I do not find that M.R. offered persuasive  
evidence that he took any meaningful steps to consult with Tarion before  
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interfering with these items or allowing a warranty service representative to attend  
and assess the items in their original state, let alone that this work was undertaken  
with Tarion’s approval.  
[211] At the same time, he offered a misleading portrait of his relationship with O.F.H.,  
stating that it was a pleasure to work with G.O. and that “the wheels are in motion.”  
He failed to disclose his enhanced concerns regarding potential mould in the  
basement or that he had already altered the site, thereby depriving Tarion of an  
accurate assessment of the situation.  
[212] While it is understandable why he chose to remove the remove the drywall and dig  
the trench himself, his actions interfered with Tarion’s ability to perform its own  
assessment of the site with respect to the drywall and the suspected mould.  
When R.S. attended at the house on November 20, 2017 to assess the issues for  
the conciliation, he was unable to inspect the area of the reported mould as M.R.  
had already removed and replaced the drywall.  
[213] Although M.R. took the position that he mitigated his losses by moving ahead with  
his own work as soon as possible, since he lacked any qualifications to undertake  
mould remediation, the proper course of action to prevent further damage would  
have been to inform Tarion of the problem before taking unilateral action. He also  
waited until mid-May 2017 to commence either project, thereby undermining any  
suggestion that this intervention represented an emergency that could not wait for  
an inspection by Tarion. That he never hired a profession mould remediation  
company despite multiple recommendations to do so also strongly undermines his  
mitigation argument.  
[214] M.R. was aware that Tarion’s role was to assist, especially with timely notice of  
potential issues. His decision to remove and replace the drywall served to  
frustrate Tarion’s right to inspect the basement for itself in order to determine  
whether the items were warrantable. The Tribunal considered this right in 9272 v.  
Tarion Warranty Corporation:  
Chief among Tarion’s rights is the right to be notified of a defect, the  
right to conduct an inspection and to determine the scope of necessary  
repairs if it finds that there are warranted items. On the part of the  
homeowner, there is a concomitant obligation to contact Tarion as  
soon as a defect is alleged so the alleged defect may be investigated  
before work is undertaken. At paragraph 19 of the decision, the  
Tribunal states:  
[19] Tarion also has rights and obligations under the  
legislation. Tarion has an obligation to conduct a conciliation  
inspection in response to homeowner complaints made in a  
timely manner. When the vendor fails to carry out the required  
remedial work, Tarion has an obligation to enter into  
settlement discussions with the homeowners and either  
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arrange for remedial work to be carried out or pay a cash  
settlement. Central to the remediation scheme is Tarion’s right  
to inspect and determine the scope of work necessary for the  
repair.8  
[215] Paragraph (g) of subsection 13(2) the Act excludes warranty coverage for  
“alterations, deletions or additions made by the owner.” As a result, M.R.’s  
replacement of the basement drywall before Tarion could perform an inspection  
served to vitiate the warranty with respect to these items. After M.R. stripped  
away the compromised drywall and covered the affected area with replacement  
materials, Tarion was unable to determine to what extent O.F.H. may have been in  
breach of its warranty obligations and to what extent those breaches constituted a  
major structural defect.  
[216] As the Tribunal noted in 8232 v. Tarion Warranty Corporation:  
By accessing a self-help remedy, the Applicants took themselves out  
of the legislative warranty scheme. The Tribunal denies the claim for  
replacement windows on the ground that it was made outside of the  
one year warranty period. If it can be established that there was water  
penetration around some windows such that it might be considered  
under the two year warranty, the Applicants’ actions of replacing the  
windows themselves rather than giving the Added Parties and Tarion  
the right to inspect and remedy vitiates any applicable warranty  
coverage. The carpet defects are clearly items that fall within the  
scope of the first year warranty. The Applicants’ failure to make this  
claim in a timely manner is fatal to them. Their claim in this regard is  
denied.9  
[217] While the Tarion deemed the mould and water penetration issues resolved in he  
earlier 30 Day and First Year Forms, these same problems persisted to the period  
covered by the Second Year Form. However, so too did the “butterfly effect”  
caused by M.R.’s interference in 2017 upon the eventual warrantability of these  
items.  
[218] The effect of the excavation outside the basement window upon warrantability is  
less intuitively obvious since two defects were found in the basement window that  
permitted water to infiltrate the dwelling. When M.R. dug the trench without  
consulting Tarion, he did so in response to the April 2017 flood not in advance of  
it. Based upon the uncontested evidence of when this work occurred relative to  
the flooding, his trench could not have caused the initial water penetration issue.  
[219] M.R. effectively bypassed Tarion and O.F.H. by digging the trench, after the first  
confirmed flood on April 11, 2017 and a possible second flood shortly thereafter.  
With respect to this second flood, M.R. described this water intrusion as having  
8 2015 72280 at para. 40 (ON LAT).  
9 2013 83569 at para. 23 (ON LAT).  
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occurred approximately two weeks after the first flood and attributed to the same  
source. Although he did not offer any further specifics on the second flood, this  
aspect of his evidence was not challenged under cross-examination and the  
possibility of a secondary penetration event shortly after April 11, 2017 was not  
directly put to any of the other witnesses.  
[220] According to M.R., he only excavated the trench outside the window after this  
second flood, explaining that he did so to prevent a third flooding event and  
because he believed that the preliminary grading outside the house in conjunction  
with the downspout on the adjacent model home was the cause of the penetration.  
As with the removal of the drywall, M.R. waited approximately one month before  
taking unilateral action and without any meaningful cooperation with Tarion.  
[221] Collectively, the evidence presented by the two Safetech witnesses offer the only  
cogent explanation for mould in the basement. While J.M. attributed the presence  
of mould to an unknown water source, six months later, A.S. complemented J.M.’s  
evidence by tracing the same water penetration to the defective window.  
Moreover, A.S. confirmed through a water test that the window did not function as  
it was intended due to poor assembly, compromised seals and poor drainage.  
[222] Although the Element report also attributed the water penetration a number of  
speculative sources including the window, between that report and the evidence  
offered by J.M. and A.S., I prefer latter as their testimony was available to cross-  
examination, while the Element report was simply submitted without being  
tendered through a witness. As well, J.M. detailed several concerning logical  
problems with the facts purporting to support the conclusions in the Elements  
report that were never reconciled.  
[223] As the Tribunal held in Hoffer v. Tarion Warranty Corporation et al:  
The failure to produce an expert for cross-examination has the result  
that any report presented should be given less weight than the oral  
testimony of a witness at a hearing because the expert authors cannot  
be subjected to cross examination.10  
[224] As a result, I find that the evidence of J.M. with respect to this issue represents the  
better evidence on the balance of probabilities. Both J.M. and A.S. testified in  
forthright and direct manner and fulfilled their obligations as experts.  
Consequently, I accept their evidence that water penetration through the defective  
window lead to the growth of mould in the basement.  
[225] A.S. offered an expert opinion with respect to the immediate cause of the pooling  
of water in the well during the test on June 7, 2021, specifically that there may be  
an obstruction to the drainage system in the window well that prevented or  
delayed drainage away from the building envelope. It is worth noting that he  
acknowledged that he could not be certain that this was the cause for the pooling.  
10 [2008] O.L.A.T.D. No. 3 at para. 47.  
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However, no other cause for this drainage issue was proposed. When that  
possible obstruction was introduced to the window well drainage system remains  
unknown.  
[226] The same water test established that the frame of the window failed to prevent  
water from entering the basement. However, paragraph (g) does not require that  
the “alterations, deletions or additions made by the owner” have any measurable  
effect on the operation of the disputed item, positive, negative or even neutral. It is  
sufficient only that they were unilaterally imposed by the homeowner and thereby  
deprived Tarion of its right to accurately assess the subject of the claim. While the  
window may or may not have permitted water to enter the house independent of  
the drainage problem, this is irrelevant to whether the exemption applies.  
[227] As a result, pursuant to paragraph (g) of subsection 13(2) of the Act, I find that the  
Appellants voided the warranty for items 1-2 and 1-3 by altering these items  
themselves, thereby preventing Tarion from assessing the builder’s possible  
liability.  
Roof and Exterior Cladding Issue  
[228] With respect to the remaining item in the appeal, the wording of Appellants’  
Second Year Form is significant as this forms the sole basis of this part of their  
appeal of Tarion’s Decision Letter:  
(6-2) Exterior – Roof (Exterior) – Building Face/Exterior – Exterior  
cladding defects (e.g. exterior wall coverings, including siding  
and above grade masonry) – Front door entrance – flashing needs  
to be added, water has been leaking under shingles for 2 years.  
[Emphasis in original]  
[229] The above complaint refers to water running off the edge of the roof and down the  
brick wall at the entrance of the house. Water staining on the exterior of the house  
is not covered by the warranty. Conversely, nothing in the Second Year Form filed  
by the Appellants above relates to water penetration into the house or the garage.  
[230] As the Tribunal held in 6834 & 6836 v. Tarion Warranty Corporation, in a similar  
fact scenario, the absence of evidence of water penetration into the building  
envelope removes this item from warrantable status:  
The warranty for water penetration relates to water penetrating the  
building envelope. A home is to be constructed such that the  
elements, rain and snow and that in between, are kept out, The  
Applicants have included, in their claim for water penetration, a claim  
that water is leaking from the balcony area down the front of the bricks  
underneath. There was no evidence that this complaint involves water  
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coming into the home, or penetration of the building envelope, and  
therefore it is not warrantable.11  
[231] As in the above case, the Appellants in the present matter did not submit a claim  
on the Second Year Form alleging that a defect in the roofing or even the flashing  
had resulted in water penetration to the house or the garage.  
[232] The definition of “building envelope” in subsection 15(1) of Reg. 892 is somewhat  
ambiguous:  
“building envelope” means the wall and roof assemblies that contain  
the building space, and includes all those elements of the assembly  
that contribute to the separation of the outdoor and indoor  
environments so that the indoor environment can be controlled within  
acceptable limits  
[233] However, since the walls of a garage walls contribute to the separation of the  
outdoor and indoor environments to no less a degree than those enclosing the  
living portions of the house, this part of a house seems to fall within the definition.  
That the garage serves as part of the “wall and roof assemblies that contain the  
building space” lends even more support for its inclusion.  
[234] After their claim was denied by Tarion’s Decision Letter, the Appellants attempted  
to retroactively expand the scope of their claim at the hearing to include leaks into  
the garage as the implied logical cause of the visible staining – essentially reverse  
engineering a warranted cause for the unwarranted stains on their masonry.  
However, since the scope of the appeal is limited to the four corners of the denial  
in the Decision Letter and a claim over leaks into the building envelope was not  
included in that letter, this issue cannot now serve as grounds for the appeal.  
[235] Similarly, although M.R. speculated that whatever caused the leak over the garage  
roof would logically affect both sides of the roof over the garage, this was also not  
an issue under appeal. Even putting aside the absence of any evidence of water  
intrusion to support M.R.’s theory, the Tribunal cannot issue orders with respect to  
items that were not covered in the Decision Letter. As Tarion was not put on  
notice of an issue with the other half of the roof, no inspection of this area ever  
occurred and it was therefore not referenced in the Decision Letter. I also find no  
merit to the Appellants’ suggestion that both sides of the roof must be replaced in  
the interests of uniformity since cosmetic considerations and “curb appeal” fall  
outside the strict threshold of a defect in workmanship or materials.  
[236] The Appellants have attempted to expand their grounds of appeal with respect to  
Item 6-2 in other ways. With respect to ice damming, the Appellants were required  
under paragraph (a) of subsection 15(2) of Reg. 892 to demonstrate that there  
was a defect in workmanship or materials that caused this issue. Noting the  
11  
2012 71132 at para. 86 (ON LAT).  
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Appellants’ unexplained delay in obtaining an expert report with respect to the  
roof issues, Tarion relied upon the Ontario Divisional Court’s decision in Ducas v.  
Tarion Warranty Corporation, in which the Court rejected the Tribunal’s incorrect  
adoption of a reverse onus on the builder to investigate issues arising after the  
submission of the Second Year form:  
Ducas suggests, as an alternative argument, that the onus to prove  
the cause of the water penetration should shift to the builder after a  
breach of the Two-Year Warranty has been established. On this  
basis, Ducas argues that the Tribunal erred by failing to place the  
onus on Forest Grove to conduct an investigation of the cause of  
the water penetration after she had established the three Violations.  
There is no authority for such a reverse onus in the language of the  
Act or the Regulation, which Ducas acknowledges. I do not accept  
that the Tribunal had this authority merely because it is to be  
viewed as consumer protection legislation, as Ducas suggests.12  
[237] As with the other facts involved, the Appellants bore the evidentiary burden to  
prove every allegation of a breach of warranty. As the Tribunal explained in Re  
Ontario 8149/ONHWPA:  
It is trite law to state that in proceedings under the Act the burden of  
proof lies on the Applicant. The Applicant must prove that an item in  
dispute falls within the warranty protections in the Act. It is insufficient  
to simply allege a defect. The Applicant must prove the existence of  
such a defect and how the defect falls short of the acceptable  
standard.13  
[238] In Ducas, the mere existence of ice damming was insufficient to establish a defect  
in either workmanship or materials used in the construction of the roof. In the  
present case, even the possibility of ice damming was largely speculative.  
[239] As in the present case, the appellants in Ducas also referenced questionable roof  
design choices that may or may not have complied with undefined “industry  
standards.” While this may be the case, this is not equivalent to the necessary  
causal relationship to a defect in the workmanship or materials that would place  
the issue under warranty coverage. At best, the evidence as presented in J.B.’s  
testimony, was that the design was less than ideal, but may lead to issues in the  
future if not reassembled. The relevant evidence was the water test conducted by  
G.S. pursuant to the defined Construction Performance Guidelines which failed to  
reveal the source of the historic leak. For all of his baseless and subjective  
criticisms of Tarion’s water test methodology, by the date of the hearing, almost  
two years after his first inspection, R.P. had never conducted his own water tests,  
12 2021 ONSC 5885 at paras. 68-69 (‘Ducas’).  
13 2015 59625 at para. 9 (ON LAT)  
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at eight hours in duration or otherwise. During that same period, he also observed  
no water intrusion through the roof.  
[240] The Appellants’ alleged inability to use the basement office is also outside the  
coverage under the Act, since like M.R.’s labour costs, these issues fall under the  
excluded secondary expenses pursuant to paragraph (b) of subsection 13(2) of  
the Act. In any event, they called no evidence on this loss of use, referencing it  
only by implication in their closing submissions.  
[241] The Appellants also alleged multiple violations of the Ontario Building Code and  
noted that paragraph (d) of subsection 15(2) of Reg. 892 requires adherence to  
these criteria. As noted above, the RJeneration report contained a passing  
reference to the Building Code. However, the apparent argument that the roof did  
not comply with the provisions of that statute was not pursued in the evidence and  
largely only arose within a list of relevant legislation during the Appellants’ closing  
submissions.  
[242] With respect to the reliability of R.P.’s report as evidence, I find that the concerns  
of the other counsel at the start of the hearing were ultimately justified. Expert  
witnesses have a duty to a court or tribunal to give fair, objective and non-partisan  
opinion evidence. They must be aware of this duty and able and willing to carry it  
out. The expert’s opinion must be impartial in the sense that it reflects an  
objective assessment of the questions at hand. It must be independent in that it is  
the product of the expert’s independent judgment, uninfluenced by who has  
retained him or her or the outcome of the litigation. It must be unbiased in that it  
does not unfairly favour one party’s position over another. In other words, even in  
the context of a contested hearing, the expert’s opinion should not change  
regardless of which party retained him or her.  
[243] Keeping these standards in mind, I find that R.P.’s report should be accorded very  
little weight as expert evidence. It was not authored by an expert, but instead  
driven by M.R. himself. It was impossible to distinguish which parts of it were  
contributed by the purported expert from that dictated by M.R., particularly as  
R.P.’s original notes were not produced, or available for even his own reference at  
the hearing. As well, since he had positioned himself to conduct any required  
remediation work ordered, R.P. was improperly incentivised to inflate the severity  
of the alleged damage, and in turn, the total cost of repairs. As well, unlike the  
other properly qualified experts, he offered no cogent authorities for his  
perspectives on proper construction standards, such as his insistence that the  
duration of a water test should be first eight then four hours at minimum.  
[244] That having been said, much of R.P.’s criticisms with respect to the roof’s inherent  
design issues, regardless of their actual source, were substantially supported by  
J.B.’s expert evidence. However, while their disparagement of the roof design and  
assembly may have appeared intuitively reasonable, neither of them held  
qualifications under the Building Code nor alluded to any cogent authority that  
would raise their distaste for the roof’s construction to that of a warrantable defect.  
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As the Tribunal noted in 9147 v. Tarion Warranty Corporation, a party asserting  
non-compliance must ground their assessment in some authority beyond their own  
preferences and experience or even more nebulous “industry standards”:  
Industry standards are not self-evident. It is not sufficient for appellants  
to bring evidence of areas of construction with which they are  
dissatisfied and expect the Tribunal, in the absence of any other  
evidence, to conclude that workmanship does not meet industry  
standards simply because the appellant alleges it is so. There must be  
some objective evidence before the Tribunal defining the industry  
standard and identifying the manner in which the complaint falls below  
that standard.14  
[245] The mere speculative capacity for future problems and subjectively dubious design  
choices do not necessarily equate to evidence of a defect in workmanship or  
materials that would give rise to a breach of warranty. While J.B.’s report detailed  
a host of less than ideal design choices, none of these rose to the severity of a  
warrantable item under section 15 of Reg. 892.  
[246] As a result, I find that the Appellants failed to meet their evidentiary burden to  
demonstrate that the roof was “free from violations of the Ontario Building Code  
regulations under which the Building Permit was issued, affecting health and  
safety, including but not limited to fire safety, insulation, air and vapour barriers,  
ventilation, heating and structural adequacy.”  
[247] Even if this were not the case, I find that the Appellants ultimately failed to  
establish the continued existence of a leak or the cause of the historical leak.  
Despite the water test conducted by G.S., no water intrusion was found and the  
precise cause of the staining to the masonry at the entrance of the house was  
never determined. J.B. found evidence of historical water penetration, but nothing  
to demonstrate that this leak remained an ongoing or even repeated historical  
occurrence. As his own report concluded, no action was required as he did not  
believe that the leak is a threat to the structure and there is not enough moisture in  
the structure from the past leak to cause rot to develop before the next set of  
shingles are required.  
[248] It is worth noting that both J.B. and R.P. consistently framed their negative  
assessments of the roof assembly in the conditional tense – in other words,  
various problems could theoretically result from this design at some unspecified  
point in the future. However, neither offered evidence that the present  
configuration had directly resulted in a leak into the building envelope. At best,  
R.P. and J.B. may have established a correlation between less than ideal design  
and assembly and a historic water leak, but never proved a causal relationship  
between the two issues.  
14 2015 38755 at para. 25 (ON LAT).  
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[249] As a result, I find that the Appellants failed to demonstrate a breach of the  
warranty with respect to item 6-2 in the Decision Letter dated November 7, 2019.  
Costs Submissions  
[250] In his closing submissions and reply, counsel for the Appellants requested costs  
with respect to the length of the proceeding and his clients’ frustration at the  
delays leading to the hearing, largely based upon the presumption that their  
appeal would succeed in spite of the other parties’ opposition.  
[251] On April 26, 2022, counsel for the Appellants filed further costs submissions based  
upon evidence and submissions not presented at the hearing, despite the  
opportunity to do so.  
[252] At the hearing, the Appellants bore the evidentiary burden to state the basis of  
their appeal. This allowed Tarion and O.F.H. to know the case to meet, such that  
they are able to provide a full answer and defence to the Appellants’ case,  
including costs submissions. The Appellants already had an opportunity to outline  
their costs submissions at the Hearing and did so both in closing submissions and  
reply. The other parties relied upon the Appellants’ submissions at the Hearing in  
tendering their own submissions in this matter, both ultimately opting not to  
request costs. There was no request for leave for any of the parties to file written  
submissions for costs or otherwise following the conclusion of the hearing.  
[253] Costs in proceedings before the Tribunal do not automatically follow the event.  
They have a punitive dimension to address unacceptable behaviour. Rule 19.1  
provides as follows:  
19.1 Where a party believes that another party in a proceeding has  
acted unreasonably, frivolously, vexatiously, or in bad faith, that  
party may make a request to the Tribunal for costs. [Emphasis  
added]  
[254] The Appellants have not pointed to any conduct on the part of either Tarion or  
O.F.H. in the proceeding that could be described as frivolous, vexatious or in bad  
faith. As well, they are not entitled to advance part of their claim, only to later  
provide further submissions that could have and should have been presented  
during the hearing itself.  
G.  
ORDER:  
[255] For the reasons set out above, pursuant to subsection 14(19) of the Act, I confirm  
Tarion’s decision in the Decision letter of November 7, 2019 and direct Tarion to  
deny the Appellants’ appeal.  
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[256] The Appellants’ request for costs is denied.  
LICENCE APPEAL TRIBUNAL  
_______________________  
Kevin Lundy, Member  
Released: May 25, 2022  
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