Well-respected consumer journalist Dr. Peter Silverman speaks out about Tarion

DR. PETER SILVERMAN spoke out on this video clip for social media after the Tarion Annual General Meeting. Mr. Silverman is a well-known broadcast journalist, a consumer advocate for 25 years, and has won numerous high-profile awards for service to the Province and the people of Ontario.  He hits the nail on the head in his assessment of the problems at Tarion Warranty Corporation.  

WHAT’S BROKEN AT TARION?

by B.Captijn

“There’s a disconnect” as Mr.Silverman points out, between what Tarion’s vast marketing machinery is telling the public, and what consumers actually experience with the new home warranty. Last night’s Annual Public Meeting seemed to leave Tarion’s board numb or dumbfounded by the intensity and sheer number of concerns voiced by consumers. Some board members I talked to seemed unaware of the serious concerns consumers have voiced with their organization.

Its true what Peter Silverman says in this short video clip taken after the meeting: this is a political problem. Karen Somerville of the consumer organization CPBH clearly states this in her message to the Premier, also posted on social media after the meeting.

But with the building industry the main contributor to Provincial political campaigns, there’s no political will to clamp down on builders’ influence or privileges at Tarion. Since neither the Ombudsman of Ontario nor the Auditor General can scrutinize Tarion’s business practices, and since the Ministry of Consumer Services seems to have become little more than a puppet of Tarion, this is a monopoly dominated by the industry it is supposed to be regulating. If it seems Tarion doesn’t really care about consumers, its because they don’t have to. There’s no independent body looking over their shoulders. Do you want to find out what Tarion’s 9 Vice Presidents and Board members earn? Sorry that’s a black box too, they are not subject to the Sunshine List either.

A monopoly without effective oversight is a scary thing.  For consumers, not builders.

Many consumers and MPPs support Rosario Marchese’s Bill 139 for Accountability and Oversight of Tarion, and PC MPP Norm Miller’s Bill 190 for the Auditor General’s oversight of Tarion. Both bills have promising support in the Legislature, but will be in limbo if Ms.Wynne calls an election in May/June 2014.

My suggestion, which has been made by many others, on several occasions:

Split up the warranty-providing function of Tarion which is meant to serve consumers, from the regulating and licensing function, which serves builders. You cannot serve two masters at the same time. Tarion is a “walking conflict of interest” in the words of a prominent MPP who has often spoken out about Tarion.  Splitting up these two conflicting functions would eliminate the conflicts which are currently causing consumers so much hardship. With all the lawyers, senior accountants, and “corporate governance experts” on Tarion’s board, are we to believe they don’t see this?

 

1 Comment

May 1, 2014 · 8:38 pm

One response to “Well-respected consumer journalist Dr. Peter Silverman speaks out about Tarion

  1. John Dixon

    I agree that there is a big problem with Tarion. One feature that gets little attention, I think, is that after Tarion has made inadequate repairs, late, ignoring code and giving no useful feedback to the homeowner, as it does, the homeowner is then ill-advised to complain, because it is likely to affect the resale value of the home.

    So the homeowner is typically ignored, and then sometimes inadequate repairs are reluctantly made by the Builder, and then the homeowner has its hands tied, because starting an action is expensive and also contrary to the owner’s interest for purposes of resale.

    All of this, and much more, happened in the last few years in a townhouse complex where we were owners. In our own unit, we put in a gas fireplace at a cost of $18,000, after nearly three years without adequate heat, so that we could have heat, and were then denied coverage by Tarion, without any stated reason, long after they had admitted that heat was a serious problem in all the units.

    Then we sold our unit, at a discount of $35,000, after disclosing the problem to the purchaser. The other owners, all with similar problems, got late and inadequate repairs, and Tarion did not bother to follow code, or even get the building plans, or disclose any information. We got an expert report that showed all these things.

    I know all this because I was president of our condo association. Tarion and the Builder were clearly working together against the home owners.
    I am a former lawyer and I am pursuing our claim in the Courts, but it is indeed very difficult, and expensive, even for me, and we may lose in Court.
    If I were still a practicing lawyer, there might even be a question whether I should disclose these facts. But from a political perspective, they need to be disclosed. And I no longer am practicing and I am not acting as counsel in this case, but as an owner. So I am wearing my consumer hat here.

    Even if we win, I do not imagine it will make much difference to the rotten way that Tarion treats home buyers. It should be no surprise that the legal interpretation in the cases has largely been in favor of Tarion, and unfair to the consumer. I think this results from the fact that the legislation is complicated, and requires quite a lot of work to understand, which is not likely to result in a favorable result for a consumer unless they hire a good lawyer to work for a considerable period of time. And the economics simply do not justify it for the consumer. All of this makes me feel personally rather like Don Quixote.

    The whole system which includes Tarion is very rotten indeed. Their motto should be changed to `Failing to protect Ontario’s New Home Purchasers, using the consumer’s money to fight the consumer’.

    And, as I said above, the average home owner is in double jeopardy: he cannot sue because it is too expensive, and he cannot complain, because that lowers the value of his home. This cries out for reform at a legislative level.

    Having the Board of Tarion dominated by builders is like appointing the fox to guard the hen house. It is preposterous! They even have a gala ball for the builders, at the expense of homeowners! Is this the Roman empire at the height of its corruption, or Canada?

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