A Cry for Help. Don’t policy-makers “get it”?

Everyday legal problems can often lead to more complex legal problems, which in turn can cause financial hardships and health problems for families and entire communities.  How can our justice system better serve ordinary citizens, be more user-friendly and problem-solving? This question was addressed in the 2013 Report commissioned by the Chief Justice of Canada, entitled a “A Roadmap for Change,” by the “Action Committee on Access to Justice…”  (see website: http://www.cfcj-fcjc.org/collaborations)

An example of very poor access to justice for consumers is the Ontario License Appeal Tribunal, (LAT). This is the main court of appeal for Tarion new home warranty decisions. New home buyers are forced by law to buy the Tarion warranty, but often find  Tarion dismisses their claims due to, for example, warranty deadlines and definitions. And they’re stuck with the problem.

Consumers who go to the LAT for resolution of construction defects find the system benefits Tarion and builders, who win 83% of the LAT cases. (See CPBH research 2007-2013, at http://www.canadiansforproperlybuilthomes.com). Builders walk away scot free, no record of defects on their track record, and Tarion pays out no compensation. The current system basically says if your defect isn’t “warrantable”, it doesn’t exist. But as licensor of builders and regulator of the building industry, Tarion has a public trust function to make sure there are consequences for shoddy building practices. If there are no consequences, there are no deterrents either.

Builders and Tarion usually hire top lawyers to defend their interests at the LAT. Most homeowners self-represent due to the prohibitive cost of hiring lawyers. Its no surprise that 83 % of their appeals fail.

But the justice system exists to protect the public, not the wrong-doer. The legislation which created Tarion was intended to be consumer protection legislation. It was never intended to shield shoddy builders from accountability, no matter how many expert lawyers they can pay for. Deep pockets shouldn’t tip the scales of justice. But at the LAT they do. That’s part of  problem the “Roadmap for Change” was intended to fix.

So what is the LAT doing to implement the report’s recommendations?

By all accounts, nothing.

I wrote in November 2013, and February and May of 2014, to Premier Wynne, the Associate Chair of the LAT, the Omdudsman of Ontario, the Auditor-General of Ontario, and the Chair and CEO of Tarion Warranty Corporation – to ask what actions they were taking in accordance with the “Roadmap for Change” which called for a more user-friendly, problem-solving, cost-efficient justice system, “putting the public first.  Many consumers also wrote, as did several other consumer organizations.

Not a peep from the Premier, nor from the Ombudsman of Ontario, nor the Auditor-General.  From Tarion’s top executives, a few familiar Tarion-isms, “we’ll look into this“, and “we’ll take this back to the board”. No action. With all the promises of transparency, accountability, and access to justice, it seems no one’s doing much of anything to remedy consumer problems with the LAT.

The taxpayer is not well-served by the current LAT system, nor is the new home buyer. However, the shoddy builder, Tarion, and top legal experts seem content with the staus quo. But they’re not the ones the legislation (the ONHWPA) was designed to protect. The longer and more complex hearings become, the more lawyers and LAT Chairs earn. There is no incentive to solve problems, or “focus on outcomes” instead of process, no training in problem-solving instead of procedural game-playing.

Consumers have experienced real hardships, both financial and health-wise, due to long and complex LAT hearings, where at the end of the road their problem was not solved.  LAT hearings keep lawyers employed, avoid warranty payouts, and let the builder who caused the problem off the hook.

The LAT cries out for improved access to justice for consumers.

Here are 5 urgent problems with the current LAT system: 

1)  Prohibitive Cost. Tarion and builders are almost always represented by lawyers; consumers are not. The ordinary middle-class consumer cannot afford $1,500-$3,000 (ex-HST) per day for a 3 to 10-day hearing. Add to this, time away from work, travel costs for those living outside major cities, the high costs of technical reports ($2,000 to $8,000), and expert testimony ($200-$600 per hour) needed to prove their cases. For a $40,000 HVAC defect, for example, legal and technical costs could eat up the entire settlement, IF you win.

2) The LAT is a “two on-one” against the consumer

Tarion and builders often “team up” to get claims dismissed. The homeowner has the burden of proof, and he’s up against not one, but two experienced lawyers.  Lawyers are allowed to “align their interests“, according to the Law Society. But this is not a level playing field. Tarion’s seemingly unlimited budgets allow it to hire top legal experts from high-profile firms, who strategize with other lawyers with a common goal, so its not hard to predict who wins the lion’s share of the cases. This might be legal, but its unfair and unjust. A devastating loss for the consumer who goes back home with the problem he relied on the justice system to resolve. One wonders why the courtroom, and taxpayer dollars, are being used to address new home defects at all. Where’s early resolution, where’s mediation?

2)  Dismal outcomes

Consumers lose 83% of all LAT appeals. (CPBH research 2007-2013). This is a problem begging for a solution.

3)  Complex, Highly Legalistic Rules and Procedures.

Even the best prepared consumers have described the LAT as a “meat-grinder”. You may be able to write well, present, and read legal cases, but nothing can prepare you for the courtroom except 4 years of  law school and many years of experience in court. The LAT’s website is antiquated, un-user-friendly, written by lawyers for lawyers, and useless in researching builder track records unless you know the exact month and year of the appeal, or to look under “ONHWPA”.

4)  LAT “Pre-hearings” are NOT being used as problem-solving forums.

Both Tarion and the LAT describe the “pre-hearings” as an opportunity for settlement. This is unfortunately untrue. With two or more lawyers in the room, and the Chair also a lawyer, the conversation quickly turns to legal tactics and procedure. To bring a motion to dismiss, to bi-furcate issues, is this res judicata, can I raise estoppel, can I get this claim thrown out altogether… The facts are rarely discussed here, its all about procedure, tactics, and process.  Whoever said the law is 15% facts, 15 % law, and 70% procedure, certainly had been to the LAT.  But the cost of legal manoeuvring ends up disproportionate to the problem to be solved. Whatever happened to “equitable principles of justice”? What training do LAT Chairs and lawyers have in problem-solving and mediation, as opposed to legal tactics?

5) Adversarial culture of the courtroom

Lawyers are trained to poke holes in the opponent’s case, withhold as much information as they can for as long as possible, and use procedural tactics to their advantage. The Chair decides a case based on information lawyers are able to draw out of witnesses during sworn testimony. Lawyers are experts at this, and have years of training doing it. Consumers do not. Even the best educated consumer lacks experience in cross-examination, formulating non-leading questions, preparing and serving documents, and researching and applying relevant case law. Consumers who have to play the role of both witness and lawyer in their own case can easily become frustrated and distressed, putting them off balance. Add to this the persistent “objections” by not just one, but two, lawyers, plus interruptions from the Chair on procedural errors, and this is a recipe for disaster. There’s a difference between being right, and being able to prove it in a courtroom.

Consumers who voice complaints to the LAT (reachable only via e-mail at “LATCorrespondence@ontario.ca” ) about unfair treatment, bullying, or bias, have been told that the Chair sitting on their case will deliberate about his own conduct, and deliver an opinion on it. Nice. But not likely to encourage confidence in the impartiality and fairness of the LAT.

Several recommendations of the Action Committee on Access to Justice stand out: “Put the Public First, “Prevent“, “Simplify“, “Take Action“, and “Focus on Outcomes“. Why should the LAT be excluded from these cross-Canada legal reforms? Its time for real action, no more brushing aside consumer complaints.

Are any of the of LAT’s policy-making or oversight authorities listening? If so, why is consumer input not being properly taken into account, and why have reforms not already been accomplished? As taxpayers and new home buyers, we need better value for money from the LAT, or we need to abandon it altogether as a method for resolving new home construction defects. Its cost currently outweighs its effectiveness.

Readers of this blog, help us amplify this cry for help.  Please write to: the Ombudsman of Ontario at info@ombudsman.on.ca; copy to the Auditor-General of Ontario bonnie.lysyk@auditor.on.ca; Please copy the consumer organization CPBH so we can keep track of e-mails, “Canadians for Properly Built Homes” at cpbh02@magma.ca

Thank you for helping us send a wake-up call to authorities for greater access to justice for ordinary citizens.


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3 responses to “A Cry for Help. Don’t policy-makers “get it”?

  1. nicole lalonde

    this is undeniably the case and new homeowners should read and read again before purchasing….

  2. Thank you for this post, Barbara Captijn. You raise excellent points.

    CPBH has conducted an annual analysis of decisions at the LAT for the past eight years. As you noted, on average, our research has found that consumers fail about 85% of the time when the LAT makes a decision. We hear from consumers regularly that they do not feel that they were treated fairly by the LAT and its processes.

    We have been very disappointed by the lack of response from Premiers McGuinty and Wynne, and the various ministers responsible for consumer protection throughout the past eight years. Although he has jurisdiction over the LAT, very surprisingly, the Ombudsman of Ontario has repeatedly refused to do anything about the issues raised in our annual LAT report for the past eight years.

    CPBH representatives met with representatives from the LAT and the Safety, Licensing Appeals and Standards Tribunal Ontario (SLASTO) on Dec. 9, 2014. We will be releasing information related to that meeting in early Jan. 2015.

    Karen Somerville
    President, Canadians for Properly Built Homes

  3. Andrew Abrahamse

    Thank you for your efforts. This is a very real issue. Homebuilders protect homebuilders not the consumer.

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