Class action lawsuits against condo developers seem to be on the rise. We have previously blogged about class actions relating to falling glass from condominiums and faulty balcony railings. The Toronto Star recently reported that a new class action has been filed relating to a different issue. The most recent class action suit claims that the developer breached the agreement of purchase and sale by failing to provide pressure-balanced water valves in unit bathrooms, which was one of the listed unit features to be provided by the developer. As a result, unit owners were experiencing “unpredictable fluctuations” in water temperature.
The plaintiff unit owner named in the class action suit claims that without the pressure-balanced valves, if residents of neighbouring units flushed a toilet or started the washing machine or dishwasher, this would result in sudden water temperature changes – something not pleasant and potentially dangerous if this happens while someone is taking a shower. Apparently the unit owner complained to the condominium board, the developer and the Tarion Warranty Corporation. While the developer claimed that it was working on a solution for all of the unit owners, the plaintiff felt that remedial measures were not being undertaken quickly enough. As a result, he took it upon himself to install the correct valves in his unit and incurred out-of-pocket expenses of approximately $4000, which included not only the cost of installing the replacement valve, but replacement of bathroom tile that needed to be broken to access the valve. The unit owner was unable to collect any reimbursement from the developer or the Tarion Warranty Corporation for these costs.
The Tarion warranty covers, among other things, defects in work and materials in the electrical, plumbing and heating systems in a new home. The governing legislation, the Ontario New Home Warranties Plan Act, sets out the procedures to be followed to have defects remedied by the developer. Self-help remedies by the unit owner are not permitted except for an emergency condition that needs to be immediately attended to.
In addition, while the Tarion warranty program covers specified builder deficiencies, it does not compensate unit owners for:
- loss of use and enjoyment – e.g. where unit owners are prevented from using their balconies pending the completion of repairs/replacement of balcony railings;
- personal injuries
- loss of rental income in the event that a unit owner is unable to rent the unit due to unremedied building deficiencies.
So far, none of the class action lawsuits against developers have gone to trial and the results of these lawsuits are unpredictable. With the rapid growth of condominium development in the GTA it won’t be surprising to see more class action lawsuits instigated on behalf of condominium unit owners when building-wide owner issues arise with developers. With a class action, unit owners do not have to fund ongoing legal fees, as class actions are generally undertaken on a contingency-fee basis – there will be no legal fees payable unless damages are recovered for the unit owners.