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Audrey Loeb Head Shot

Tarion Warranty Corp.’s recent efforts to provide more consumer information on the risks of pre-construction condominium purchases don’t go far enough, and the new home regulator should take an aggressive role in requiring more standard-form agreements, Toronto condominium lawyer Audrey Loeb tells The Globe and Mail.

As of Jan. 1, 2020, Tarion will require “any vendor selling pre-sale condominiums to include a two-page information sheet about the project that will assist buyers in appreciating the potential pitfalls in signing a contract to buy an unbuilt home from plans,” the Globe reports.

“The form will compel sellers to spell out early-termination conditions, any potential title restrictions on the proposed land, as well as expected completion dates and a disclosure about whether a building has obtained zoning approval,” the article continues.

Loeb, a partner with the Toronto office of Shibley Righton LLP, tells none of this will mean anything to the average condominium purchaser.

“Tarion created a late closing form to be attached to all agreements of purchase and sale for condominiums — it is 10 pages long. How does that help the consumer?” she says.

“It’s just more stuff for people to read,” Loeb tells the Globe. “The problems of cancellation are important to people, but it’s truly the tip of the iceberg of the issues that affect the buying public when it comes to condos.”

She tells the Globe that many agreements of purchase and sale together with the disclosure packages for condos are already 100-plus pages and are filled with “thickets of legalese that can lock buyers into such things as unspecified extra fees, options to extend the completion date” for years into the future, and contracts, which bind the future condominium corporation to unfair terms, many favouring the developer or associated companies.

The newspaper reports that so far this year, seven projects have been cancelled, representing more than 2,100 units.

“Cancellations are inevitable. … People should just understand the risks and be prepared to deal with that,” Tarion CEO Howard Bogach told the Globe.

“I am disturbed by the rights developers are allowed to retain and which can impact what a purchaser gets,” Loeb says. “I’ve been saying that Tarion has to take a more aggressive role in requiring more standard-form agreements” and the Government of Ontario needs to see the consumers’ side of things.

A report recently tabled by Ontario’s Auditor General Bonnie Lysyk says Tarion has failed thousands of new homebuyers by placing the interests of builders ahead of theirs, the CBC reports.

Lysyk found the agency, which also regulates the industry and is controlled by a board made up largely of developers, has until recently operated with very little oversight and was allowed to write its own rules.

“Lysyk found most of the public complaints about Tarion’s dispute resolution process were justified, and that the Ontario Home Builders Association ‘had disproportionate influence over Tarion’s decisions and operations,’” the article states.



Armand Conant Headshot

A growing number of condo corporations are struggling to get reasonable insurance coverage, says Toronto condominium lawyer Armand Conant.

“It’s a mammoth problem,” says Conant, a partner with Shibley Righton LLP. “In light of the number of claims being made by condo corporations, insurers appear to want to get out of the industry.”

Since its inception, Ontario’s Condominium Act has required a condo corporation to “obtain and maintain insurance on its own behalf and on behalf of the owners, for damage to the units and common elements that is caused by major perils” or other circumstances identified in the corporation's declaration and bylaws.

According to the Act, those major perils include fire, lightning, smoke, windstorm, hail, explosion, water escape, strikes, riots or civil commotion, impact by aircraft or vehicles, vandalism, or malicious acts.

Although the legislation makes no mention of the availability of coverage, it does specify that the coverage level must be high enough to meet the replacement cost of damaged property.

“Since the 1960s, condos have been able to obtain insurance. If they’ve had frequent claims, then their premiums and deductibles usually go up,” Conant tells

But in the last two years, he says industry watchers have noticed a large spike in premiums and deductibles, leading to the suspicion that insurers are trying to get out of the business.

One of his clients was forced to make three substantial claims following flood damage, two of which the condo board believes resulted from faulty construction by the developer.

While the claims went smoothly, the insurer informed the corporation that it would not renew its coverage when the policy expired.

“They were scrambling around, trying to find insurance,” Conant says, explaining that the board only managed to obtain new coverage in the nick of time through its broker by cobbling together a consortium of insurers prepared to take on the risk of further claims.

“It got down to the last day before the existing policy was to expire, and it was only possible through the work of many people,” he says.

But the board’s relief at getting some coverage in place was tempered by the terms of the deal, which saw their deductible for flood damage jump to $500,000, while the deductible for all other claims rose to $350,000. In addition, the corporation’s annual premium more than tripled from $65,000 to roughly $225,000.

“Outside of a catastrophic event, they’re essentially paying $225,000 for the privilege of not being insured because almost all of the claims will come in under the deductible,” Conant says.

And this client is not alone, he says, adding that he’s heard of one corporation that has a $1-million deductible.

“We’ve seen case after case like this, and we believe it is on the rise. In addition, we are aware of at least three or four condo corporations who cannot get insurance at any price, at any deductible, which means the owners are left with no insurance on their building,” Conant says. “If they can get it, then the owner can’t buy adequate unit insurance to cover the corporation’s large deductible, thus exposing themselves to liability and maybe, in the most extreme cases, even losing their home.

“It’s a hot topic in the industry.”

Conant says stakeholders, such as the Toronto chapter of the Canadian Condominium Institute (CCI), have approached the government to make it aware of the growing crisis, and are also offering assistance in trying to find solutions. He says the CCI is holding a symposium on the issue on Nov. 9 at the Delta Hotel Toronto. For more information, contact



Matthew Urback Head Shot

The controversy surrounding the death of financier Jeffrey Epstein shows that no matter how rich or famous you are, issues around estate planning can come up after you die, says Toronto wills and estates lawyer Matthew Urback.

“Having hundreds of millions of dollars does not necessarily insulate anyone from the legal challenges in an estate after a person dies,” says Urback, a partner with Shibley Righton LLP.

According to a CNBC story, a bitter legal battle is expected following the 66-year-old’s suicide in a Manhattan jail cell, where he was being held pending trial on charges of sex trafficking with minors. His last will was drawn up just two days before his death, the story states, with his estate valued at more than US$577 million, as well as the fine arts, antiques and collectibles that have yet to be evaluated.

It is expected that the women who accused him of sex offences will file claims against his estate, tying it up in litigation for an unknown period of time, CNBC reports.

While Ontario’s laws in this area are different from those in the United States, Urback says the tussle over Epstein’s fortune provides three valuable lessons for people on this side of the border.

Your debts don’t die with you

“Epstein left quite a sizeable estate, and many lawsuits are almost certainly coming against it, so I think people might wonder if the same situation arose here in Canada, would the debts be passed onto the beneficiaries,” Urback tells

“The answer is no because any money awarded from the lawsuits is taken from the estate first, with no liability passed onto heirs,” he says.

In Ontario, if someone has launched a lawsuit against an individual and that person dies, a court order has to be granted for the action to continue, with the estate trustee or executor standing in place of the deceased person in defending the lawsuit, says Urback.

“If Epstein were an Ontario resident, just because he’s dead wouldn’t mean that he would escape from his debts,” he says.

We don’t have an estate tax

Since one of Epstein’s five homes is located in New York City, the story notes that New York State will probably apply to have its estate tax — which tops out at 16 per cent — levied against him.

“By contrast, Canada is a very favourable jurisdiction for hoarding assets and wealth and transferring it onto future generations,” says Urback.

The only thing Canadians pay upon death is a probate fee of approximately 1.5 per cent of the estate, he says, explaining that it’s meant as more of an administrative surcharge.

“Who knows, one day our government may bring in an estate tax, following the example of other countries, including the United States,” Urback says.

Deathbed wills are valid but troublesome

The story states that Epstein’s last will was drawn up two days before his suicide.

“There’s nothing wrong with that, as people make wills all the time on their deathbed, but that can lead to potential challenges,” says Urback.

“Doing a will right before your death isn’t inherently problematic, but the circumstances surrounding it leads to some vulnerabilities,” he says.

Those challenging the will of people who are unhealthy and nearing the end of their lives could argue they are not competent or susceptible to undue influence, even though there have been cases in Ontario where people suffering from illnesses have been deemed to have the capacity to change their wills, Urback says.

“If someone is in hospital and being medicated, those drugs can impact their thinking and mental state, leaving open an avenue for people challenging the will,” he says.

“Many issues evident in the Epstein case really transcend economic status,” Urback says.


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