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Page 6 September 5, 2016 • Law timeS www.lawtimesnews.com Home inspection regulation long overdue T his fall, the Ontario Liberal gov- ernment will table draft legis- lation to finally license home inspectors, giving a boost to the sector. The announcement last month by Minister of Government and Consumer Services Marie-France Lalonde is long overdue. The Ontario Association of Home Inspectors was established in 1994 to set licensing standards and member- ship is not mandatory, but some 95 per cent of the 1,500 or so home inspectors are members. The new legislation would make li- censing by an administrative authority mandatory, set minimum standards and provide recourse should things go wrong and contain an enforcement provision. Lalonde says it will also set standards for home inspection reports, disclosures and the performance of home inspec- tions. As it stands, only about 65 per cent of resale homes sold annually receive a home inspection. The news was welcomed by the OAHI and people practising real estate law. However, everyone is waiting on the draft legislation to see what it covers. The draft will be based on 35 recom- mendations in five areas made by the Home Inspector Panel Report entitled "A Closer Look: Qualifying Ontario's Home Inspectors," presented in December 2013. These are early days yet, notes Murray Parish, OAHI president. He expects the licensing will be self-funding like that of other professional organi- zations. "They've talked about it for a few years and we support it," he says, noting that setting standards and minimum re- quirements is something con- sumers want and need. It's also something the legal profession sees as progressive, says Ray Leclair of the Ontario Bar Asso- ciation's Working Group on Lawyers and Real Estate. "It's something in dire need of change," says Leclair, who spent 25 years practicing real estate law and is now vice president at LawPRO. "You look at the contract for an in- spection and the liability is limited to the value of the inspection. Basically, they give your money back. It doesn't help you if you're stuck with hundreds of thou- sands in repairs." The draft is a start, he says, and once the baseline is established there will still be work to be done to cover all the bases. As Parish notes, septic inspectors aren't covered and the legislation seems to be aimed at houses, not condos, and while the status report required on a condo resale covers most issues, it often misses items, which sometimes results in special assessments on unit owners — a nasty shock for new condo buyers. "There will be growing pains," says Leclair, noting that home inspectors are the only players in a real estate transac- tion not subject to regulation and licensing. He says the inspection is the weakest link in the trans- action and the most problematic in terms of liability. He also says most offers for homes come with a clause requiring an inspec- tion as a condition, but red-hot markets such as Toronto prompt listing agents to simply set a date for unconditional offers. "They push the risk back on the buy- ers," he says. Politically, it's also a start. There's no discussion of making home inspections mandatory, but it might be prudent to bar sellers from refusing an inspection condition in an offer. More changes to the process in a re- sale transaction are also in the pipeline. By 2019, Ontario also expects to have a mandatory Home Energy and GHG Rating and Disclosure program in place and it could add up to a big boost for the home inspection sector. It will require every home to be sub- ject to an energy audit and the results posted with the listing so buyers know what their energy costs will be. The plan is for the audit to be paid for by the government from funds gener- ated from the looming carbon levy, says Jay Nordenstrom, executive director of the North American Insulation Manu- facturers Association Canada, and part of a coalition of 125 manufacturers and home builders supporting the move. While energy auditors are qualified under a federal program run by Natural Resources Canada, it's not a quantum leap for home inspectors to get certified and provide two services with one visit. The carrot is that under the audit pro- gram homeowners who invest in energy- saving technology — mostly new win- dows, weather stripping and insulation — can get rebates on the costs and raise the listing value of their property. "I have faith the market will rational- ize itself and there will be opportunities," he says. LT uIan Harvey has been a journalist for more than 35 years writing about a diverse range of issues including le- gal and political affairs. 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As Law Times has reported, the provincial government recently expanded a pilot project that digitized e-filing in Small Claims Court but fell short of introducing such a system for other courts. A spokeswoman for Naqvi says, "Taking a gradual and responsible approach, we would like to find ways to introduce more technological solutions into the justice system. "The Attorney General is very keen on looking into how we intro- duce technology in a way that it becomes part of the court system to make it more user-friendly. People who still want to go to a counter and use paper need to still have that access, but we want to see how we can modernize the system," the spokeswoman told Law Times. "One of the questions the Attorney General has asked for example, is can we take e-filing in civil claims and make it easier for parties to file their claims using electronic technology." The devil, of course, will be in the details. As Silicon Valley ven- ture capitalist and author Guy Kawasaki sagely says, "Ideas are easy. Implementation is hard." It will be curious to see what goodies are offered as Ontario Pre- mier Kathleen Wynne and her Liberal colleagues prepare for the pro- vincial election scheduled for 2018. For Naqvi, still fresh in his role, big changes around digitizing the courts may come in small increments. Sterns, for one, says introduc- ing e-filing — or even completely paperless courts — has not been a priority. "It's an embarrassment and it costs money for practising lawyers and causes great challenges to the judiciary and of course all that comes back to the client who ends up paying the cost," Sterns says. Lawyers across the province, and Canadians they serve, will benefit from these investments. LT Queen's Park Ian Harvey

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