12 Feb 2019

    Protect Your Condo Investment From The Sky High Costs Of Construction Deficiencies Featured

    According to the Toronto Real Estate Board, the average price of a condominium apartment in Toronto was $558,728 in Q4 2018. This is a sizeable investment.

    The first few years of condo ownership are critical. If you fail to address and acknowledge issues in your building and in your condo unit, your property investment can suffer.

    Here are a few tips to help you address construction deficiencies and protect your investment.

    Understand the declaration, by-laws & your unit boundaries 

    In general terms, condominiums are comprised of “common elements” and “unit elements.” These terms are created by the Condominium Act and reinforced in your condominium’s Declaration and By-Laws. The Declaration and By-Laws, which are provided to you when you purchase a condo unit, contain the rules and regulations that govern your condo. Among other things, they define the unit and common elements of your building. It is important for you to review your declaration and by-laws and understand the distinction. A unit element is generally your responsibility to repair and a common element is the condominium’s responsibility to repair.

    Reporting common element deficiencies 

    An example of building components that are typically classified as common elements would be exterior windows. Say, for example, you notice water seeping under your exterior windows during a storm. You have reviewed your Declaration and By-Laws and (with or without legal assistance) you have determined that the exterior windows are, in fact, common elements. Once you have identified and classified the issue, you should report it.

    The issue should be reported directly to the building developer, the property manager, and (where properly constituted) your condominium board. Remember, common elements are the responsibility of the condominium at large. Once reported, the Board and property manager must ensure the deficiency is corrected. As a safety measure, the deficiency should also be reported to Tarion.

    Tarion is a statutory body or organization that is responsible for administering the Ontario New Home Warranties Plan Act. Among other things, Tarion can order the building developer and the condominium to conduct repairs. You can register your condominium unit and report building deficiencies via Tarion’s online portal known as “MyHome.”

    Reporting unit element deficiencies 

    The unit elements are your responsibility to repair. For this reason, it is important that you report all deficiencies while you are protected by Tarion’s warranty program. Generally speaking, Tarion’s warranties are provided in three stages:

    Year 1 – During the first year of ownership, Tarion warranties: (i) defects in work and materials, (ii) the unauthorized substitution of materials, (iii) Building Code violations, (iv) water penetration, (v) defects in exterior cladding, (vi) heating, plumbing and electrical systems, and (vii) major structural defects.

    Year 2 – During the second year of ownership, Tarion does not warranty defects in work and materials or the unauthorized substitution of materials. It warranties the other items listed above.

    Years 3 to 7 – During this period of ownership, Tarion only warranties major structural defects.

    Given the lifecycle of Tarion’s warranties, you must ensure that all possible defects are reported in the first year. If you fail to report a defect in the first year, you may be on the hook for the costs of repairing it.

    As with the common element deficiencies, the issue should be reported directly to the building developer, the property manager, your condominium board, and Tarion.

    Logging your evidence

    Though it is logical to assume that a new unit would be in perfect condition, that assumption is far from reality. For that reason, you should retain a home inspector to review the condition of your unit.

    Ideally, the inspection will be conducted during the winter months and will, among other things, include thermal imaging of your unit. The report should outline (i) the nature and scope of identified deficiencies, (ii) the standard method of repair, and (iii) a general fee schedule for repairs where possible. If an issue is discovered that is beyond the inspector’s area of expertise, such as a mechanical defect in your HVAC/ventilation system, a specialist should be hired to provide an opinion. These reports will be of great assistance in that they will target the specific issues and give you leverage to request the proper repairs.

    In addition to obtaining inspection reports, you should log all deficiencies in photos and videos. Do not delete any records concerning the deficiencies in your unit.

    Review repairs with skepticism

    As a final note, you should not assume that repairs are completed correctly. Be sure to track the method of repair and the materials used. If the repair is completed incorrectly, you may have remedies against the developer or the condominium.

    Read 1244 times Last modified on Tuesday, 07 April 2020 06:40
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    Walker Law Professional Corporation

    Tanya Walker obtained her law degree from Osgoode Hall at York University in 2005 and her Honours Bachelor of Commerce with a minor in Economics from McMaster University in 2002. She was called to the Ontario Bar in 2006 and created Walker Law a litigation law firm in 2010. Tanya is currently serving a term as Bencher of the Law Society of Ontario; elected by her peers as not only the first Black elected female Bencher from Toronto, in the 220-year history of the Law Society, but also as one of the youngest sitting Benchers.
 Tanya is a frequent speaker on legal issues to the Toronto Community and regularly appears on the CTV Show, Your Morning as a legal expert. She has also been named in the 2017 and 2018 Lexpert Guides as one of the Leading Lawyers to Watch in Corporate/Commercial Litigation and is also the recipient of the 2018 Women’s Business Enterprise of the Year Award.

 Tel: 647-342-2334 ext. 302 
 Email: tanya(at)tcwalkerlawyers.com


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