Using a sledgehammer to kill a fly: the License Appeal Tribunal

Access to justice means providing equal access for all citizens, not just for large corporations and wealthy individuals.

For years consumers have voiced serious concerns about lack of a level playing field for new home buyers who appeal Tarion’s warranty decisions at the Ontario License Appeal Tribunal (LAT).

Consumers have been telling their MPPs, LAT management, and Ontario Government ministries for years the LAT is not  a “fair, timely and accessible dispute resolution” forum, as promised in the Tribunal’s mission statement.

Homeowners find themselves at the LAT up against experienced litigators from Tarion’s in-house legal department and outside counsel, as well as the builder’s lawyer. Most consumers have to self-represent due to the high cost of lawyers with hourly billing rates of from $450-850 per hour, as well as the high cost of experienced expert witnesses.

The onus of proof is on the homeowner to prove often highly complex construction defects. There is an asymmetry of information since Tarion has information from the builder on what he did, but the consumer is left on his own to try to discover exactly what the builder did wrong.  Experienced litigation lawyers use adversarial tactics like attacking the credibility of witnesses, using procedure and case law to confound the opponent, using delays, motions and other wearing-down tactics, these are all part of business as usual in the courtroom.

It is no wonder consumers lose over 90% of the time at the LAT in appeals from Tarion decisions.  With these odds, many have given up even trying. And the wrong-doers walk away scot free.

We’d all like to come to court with the best lawyers money can buy, and thereby increase our chances of winning. But the number of self-represented litigants is growing. Lawyers have priced themselves out of the middle class market, and the access to justice problem grows. This has raised alarm bells at the highest levels of the judicial establishment, with many senior judges and policy-makers saying that we can’t continue with a legal system where only large corporations and the wealthy have access to justice.500_F_30213842_JaLlWxcIGsN5ZIptyIHiERagSQ6z7YrG

Why isn’t the LAT providing solutions to the many access to justice problems they’ve known about since at least 2007?

In early 2014, I wrote to the LAT’s Vice-Chair, Mr. Yee, and asked him what he will do to improve access to justice for consumers at the LAT. I asked how the Access to Justice Report “A Roadmap for Change” (Oct. 2013) commissioned by the Chief Justice of Canada would be affecting the LAT. He responded the LAT would be implementing measures in line with recommendations in the federal report.

Aside from these promises by both the LAT and its oversight body, SLASTO, nothing concrete seems to have been done.

Problems such as missing court recordings, (in the 2015 Ferland/Ferenc case where complaints about bullying are “missing”); prolonged delays in hearings ( 1 1/2 years to accommodate lawyers’ schedules is not timely resolution); unreasonable delays in rendering decisions, (130 days is not within the 30-day given time-frame); allowing adjudicators’ to self-judge complaints about their own conduct… all these disturbing incidents have taken place since the LAT’s promise to improve.

MPP Randy Hillier, the PC Justice Critic, asked the Attorney-General in the Legislature last week on Oct. 21st and 22nd, 2015 when she will modernize the out-dated, complicated, and inefficient Tribunal model in Ontario.  She has been made aware of serious process problems at the LAT since taking office in 2014.

If the LAT is consulting with consumer stakeholders for suggestions on how access to justice could be improved, here are a few:

  1. A legal “triage” service should be created at the LAT to help consumers determine what remedy is best suited to the particular home defect they’re trying to resolve: is this a breach of warranty, or a breach of contract? Is the consumer self-represented? Would mediation instead of a courtroom get the problem fixed in a more timely and cost-efficient way? A knowledgeable, friendly, IMPARTIAL legal official at the LAT should be available to consumers as part of an avoiding-the-courtroom strategy. All that is available now is a receptionist with no legal training, and a generic e-mail contact.  To tell consumers “get legal advice” is unhelpful, and not the way to resolve problems.
  2. No more use of the courtroom if the consumer is self-represented. Mediation, mediation, mediation. Trained, independent mediators, perhaps with an engineering degree should be available, since many disputes usually involve building technology, not strictly legal issues.
  3. Investment in on-line dispute resolution (ODR) for some disputes under a certain dollar amount. Some commonly found new home defects like squeaky floors or leaky basements shouldn’t have to go to the LAT to get resolution. Since Tarion usually wins at the LAT, there’s a perverse incentive for them to use the courtroom when they know they can win there.  (See article re ODR, Law Times, March 2, 2015)
  4. If the consumer is self-represented, and Tarion wants to proceed to the LAT, they should provide an equal amount to the consumer out of the warranty fund for their defense.  This would cut down on the over 90% success rate Tarion now enjoys at the LAT by using expert litigators to fight self-represented consumers.
  5. There should be an annual limit on all Tarion’s legal expenditures, and this should be transparent to demonstrate to the public Tarion is using it wisely. As a large government monopoly, Tarion has a responsibility to the public to make sure its spending the money for consumer protection, according to its mandate, not builder protection, or to avoid warranty pay-outs.
  6. The current silo-thinking between Tarion and the LAT and both their oversight Ministries is compounding the access to justice problem. The 2013 Report on Access to Justice suggests a co-operative, collaborative approach, and urges organizations to work together to implement reforms.   As the finger-pointing continues at the LAT, the consumer gets left with the problem, and is the party least likely to be able to bear the financial and emotional consequences of it.

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5 Comments

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5 responses to “Using a sledgehammer to kill a fly: the License Appeal Tribunal

  1. nicole lalonde

    Why do our ” responsible” government leaders bury their heads in the sand with statements as ” they know what they are doing ” to defend their current faulty positions when consumers who have been ill done by bring their facts to the fore; why do our government leaders trust stereotyped , promotional statements blurted by bodies who enjoy non transparent status that are undeniably contrary to visible facts and experiences of those who have lived them ??

    • Seems our government leaders have known about these problems for many years. They follow the money. Its not politically expedient for them to step on the toes of the powerful building industry lobbies which have a dominant position on Tarion’s board and are generous donors to the major political parties. Lack of transparency and accountability at a huge government monopoly can never be in the public interest.

  2. Lisa

    There will never be any person that these forums will think is impartial enough because as soon as they agree with Tarion, they will automatically be lablelled as being on their side. First Tarion was not impartial and now LAT is not. How many more layers of appeals need to be added before people start accepting that sometimes, just sometimes, a deficiency is not covered by the limited warranty??

    • A defect may not be covered under the Tarion warranty, agreed. But Tarion is – under Ontario law – regulator of the building industry and licensor of builders. So Tarion has the responsibility to make sure builders repair defects in construction they build into new homes. To say defects are not covered under the warranty is one thing, to let the builder walk away from his own shoddy work is quite another, especially if you’re the industry regulatory body. Most construction defects in new homes are not legal issues, they are construction issues, and need to be inspected not by lawyers but by a qualified building inspector or engineer. In the case of an HVAC defect discovered after year 2, for example, Tarion should have a proper inspection by a qualified engineer to determine the root cause, and have the builder fix it. Putting the consumer through a legal quagmire up against 2 qualified lawyers at the LAT to try to get his home fixed often benefits no one but the lawyers. Tarion knows it usually wins at the LAT against homeowners, so they have no incentive to change this. The imbalance in financial resources, power, and information, was the point of my blog post.

  3. nicole lalonde

    Agreed …once a body is designated ” the regulator ” , one would reasonably expect that the corporation accepts the full package . Where a defect is discovered, the owner appeals to the designated experts resource to solve something he/she is not an expert at, otherwise he/she would build the house him/herself . Why , when an owner uncovers a building construction defect in his new home does he/she merit facing the legal community and paying a bundle AGAIN . And why ?….simply to rectify a deficiency he/she did not cause but which the so called building expert through neglect, incompetence and even corruption can or will not admit to. This is what the consumer needs protection from ! Licensing should imply ‘certifying as capable ‘…..not only having paid its dues !!!!

    1. All warranty issues should be decided on their merits – Tarion and the builder use legalese to obstruct merit arguments 2. Tarion does not have “clean hands” – makes opposite arguments at different hearings, obstructs attempts to get Tarion bylaws, makes baseless claims, or baseless claims of discretionary powers and does not even apply or provide the correct ONHWPA for the homeowner’s warranty period 3. The problem is that Tarion is not trying to protect homeowners, it is building up its cash and its own bureaucracy; It has half billion in cash, collects 50 million a year in fees, pays out around 7M per year and spends millions on lawyers in addition to its own inhouse counsel.There is no accountability and the little homeowner’s claims, even in cases of health and safety are of no concern to an immortal soulless corporation. This is not about unwarranted defects.

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