COLCO advocates leaky condo compensation - November 27, 2000

2000 Legislative Session: 4th Session, 36th Parliament



Monday, November 27, 2000
11:00 a.m.

Burrard Room, Century Plaza Hotel
Vancouver, B.C.

Present: D. Lovick, MLA (Chair); G. Farrell-Collins, MLA (Deputy Chair); J. Cashore, MLA; J. Pullinger, MLA; I. Chong, MLA; M. de Jong, MLA

Unavoidably Absent: B. Goodacre, MLA; G. Mann Brewin, MLA; D. Streifel, MLA; E. Walsh, MLA; R. Thorpe, MLA 

1. The Chair called the Committee to order at 11:02 a.m.



Mr. Balderson, you and your colleagues, I believe, are next on our list. Gentlemen, whenever you are ready, proceed.

J. Balderson: Good afternoon, members of the committee. Thank you for this opportunity to meet with you this afternoon. To my right is John Grasty, a member of the Coalition of Leaky Condo Owners, and to his right is Rudy Eylmann, also a member.

All three of us own leaky, rotten homes built and sold in British Columbia -- some of them with a fraudulent new-home warranty that was provided by the Canadian Home Builders Association -- owned, controlled and directed by the builders building leaky, rotten homes and providing a fraudulent, rotten warranty to cover them. As you know, the NHW is now bankrupt, and many of our members are headed that way. We've had several commissions of inquiry, two with which you're familiar, and our own is ongoing.

The Coalition of Leaky Condo Owners believes that compensating the owners of leaky, rotten condos will help restore confidence in the government, the justice system, the housing market and the provincial economy. To do less will continue the erosion of that confidence and increase the cynicism and despair of citizens in this province.

I'm going to turn over our presentation to John Grasty for some of the economic matters. Of course we work closely with Carmen, and we'd like to applaud her presentation, which you have just heard. After that, Rudy Eylmann will give you an insight into what it's like to live in a leaky, rotten condo at his stage of life -- as are many of our members. Then I'll provide a wrap-up sentence or two.


Regulation of leaky condo inspectors struck down; BC Supreme Court declares Judicial Building Envelope Qualifications Committee ultra vires



Morton v. Joint Building
Envelope Qualifications




2000 BCSC 1214



Registry: Vancouver











Counsel for the Petitioner:

M. E. Baird and
T.S. Woods

Counsel for the Respondents:

R.W. Hunter and
B. Allard

Date and Place of Hearing:

October 30, 2000


Vancouver, BC

[1] This is an application by Ross Lance Morton ("Mr. Morton"), a member of the Association of Professional Engineers and Geoscientists of British Columbia ("the Association"), under the Judicial Review Procedure Act, R.S.B.C. 1996, c. 201, to, among other relief sought, set aside the decision of the Judicial Building Envelope Qualifications Committee ("the Committee") of the Architectural Institute of British Columbia ("the Institute") and the Association to deny him accreditation as a Building Envelope Professional (BEP).

[2] It is not challenged that I have the jurisdiction to decide this issue. It is also agreed on behalf of the respondents that if I find that the Association is essentially regulating the practice of members by its participation in the Committee (or, in my words, in acting through the Committee), then the decision of the Committee with respect to Mr. Morton must be struck down.


[3] In 1995 and 1996, in an attempt to deal with a significant degree of building envelope failure in multiple-family residential buildings (more commonly known as "leaky condos"), the City of Vancouver ("the City") implemented an inspection regime to be carried out by independent inspectors acceptable to the City. The City produced an interim register of acceptable inspectors in anticipation of the Association and the Institute jointly implementing a program to accredit professional engineers and architects as such inspectors. Thus, in 1999, the Association and the Institute created the Committee to develop and administer the accreditation program which provides for the issuance of a certificate under a common set of criteria developed by the Committee and adopted jointly by the Councils of the Association and the Institute. The Committee is comprised of three nominees from each of the Association and the Institute, and one each from the City and the Building Officials Association of B.C. ("BOA").

[4] Accreditation requires the applicant to be a member of either the Institute or the Association, have a certain level of experience, successfully complete an education program, and pay both an application fee and, once accredited, an annual fee. In certain cases (such as Mr. Morton's) an interview of the applicant by three members of the eight member Committee is directed. The three members report to the Committee which then accepts or rejects the application for accreditation. It is the Committee itself that makes the final decision, not the Association nor the Institute.

[5] Mr. Morton's application resulted in a first interview on February 2, 2000 following which his application was denied on March 16, 2000. He then resubmitted his application which resulted in his being interviewed on June 12, 2000 by another three members of the Committee with the same result. A request for a third interview was denied.


[6] In his petition, Mr. Morton raises the issue of procedural fairness, but that was, by agreement of counsel, not argued before me. I was asked to decide only the issue of the jurisdiction of the Association to deal with the accreditation of its members as BEPs in this manner. As noted earlier, the question is does the scheme amount to regulation of their members by the Association and the Institute?

[7] The Canadian Oxford Dictionary (Toronto: University Press, 1988) defines the word "regulate" to mean "govern or control by law; subject to legal restrictions". In Laidlaw Environmental Services Ltd. v. Moore (Township) (1993), 19 M.P.L.R. (2d) 30 (Ont.Ct.Gen.Div.)at 46, Mr. Justice Ross, in considering the extent of municipal powers to regulate land use in order to abate or avoid nuisance defined the word "regulate" in a broader manner as follows:

The Living Webster and Encyclopedic Dictionary of the English Language, 1971 defines regulating as follows: to adjust by rule or establish mode; to govern by or subject to certain rules of restrictions; direct; to put or keep in good order; to control and to act properly.

The Shorter Oxford English Dictionary on Historical Principals defines "regulate" to mean: to control, govern, or direct by rule or regulation; to subject to guidance or restriction; to adapt a circumstances or adjust, in respect of time, quantity, etc., with reference to some standard or purpose.

The term "to regulate" was considered in Re Campbell and the Municipal Corporation of the City of Stratford (1907), 14 O.L.R. 184 at 185, to mean: to subject to a prescribed course.

From these definitions may be drawn the conclusion that regulating imports the element of control or the prescription of a course of action which absent a regulation does not have to be followed.

[8] Mr. Hunter, for the respondents, argued that this scheme does not amount to regulation of their members by the Association and the Institute. This is because, he said, Mr. Morton's status as a member of the Association is not affected by the actions of the Association and the Institute participating in the Committee. That is, the role of the Association is merely to participate with the City and BOA in the Committee to examine credentials, a task that had formerly been undertaken (since 1995) by the City itself. In doing so, the Association and the Institute were performing a public service role, he said.

[9] I have some difficulty with that position. The terms of reference of the Institute and the Association for the BEP designation make it clear that those two respondents have created the Committee and its accreditation program. They are not simply seconding members to an accreditation board created by a third party (for example, the City). They have, in response to a significant problem in the condominium construction industry, developed an accreditation mechanism intended for, not the members of the construction world at large, but their own members. They did so knowing full well that the City had, or would have, a by-law restricting the right to work as building envelope inspectors to those with a BEP accreditation conferred by the Committee. Many other municipalities in British Columbia are following suit and, at the present time, I take it a significant percentage of communities where such construction is taking place have adopted such by-laws.

[10] That is the point, says Mr. Hunter. It is these municipalities that effectively place a restriction on the practice of architects and engineers like Mr. Morton, not the Association. He is still free to practise all types of engineering open to any other professional engineer, including building envelope inspections, anywhere in B.C., except where restricted from doing so by municipal by-laws. That may be so, but the reality is that the Institute and the Association have to know that any of their members who lack a BEP accreditation will be denied building envelope inspection work in a significant portion of the province.

[11] Mr. Hunter argued also that the Association does not regulate a member's practice as a professional engineer by reference to whether that member has BEP accreditation. That is so, but the effect of accreditation by the Committee clearly impacts the member's practice.

[12] Finally, Mr. Hunter states that the Association does not discipline a member on the basis of whether that member has BEP accreditation (except, perhaps, if the member misrepresented himself or herself as having such accreditation and then only for the misrepresentation). Mr. Woods, for Mr. Morton, argued that if that position is accepted, it illustrates a recognition by the Association that the BEP designation is of sufficient importance to the Association that its members would arguably be guilty of professional misconduct by misrepresenting themselves as having the accreditation when they did not. Quite frankly, not much turns on either of these points in the context of the larger argument in my assessment.

[13] Undoubtedly, the concept of accrediting individuals to have expertise in building envelope construction was an excellent one, and one that was undoubtedly dictated by the pressures brought about by the public outcry regarding leaky condos as voiced, in part, in the June, 1998 report of Mr. Dave Barrett, an inquiry commissioner appointed by the Provincial Government.

[14] It may well be that Mr. Morton was properly refused accreditation as a BEP according to a valid set of criteria properly applied by a neutral Committee. That engineers and architects who do not meet such valid criteria should not be BEPs is undoubtedly in the public interest. However, my task is not to look into the process that was followed in reviewing Mr. Morton's application, nor to review the validity of the criteria. It is simply to determine if the Association and the Institute are, in fact, regulating the practices of their members through the Committee. If so, then it is conceded that they have gone about it in the wrong way. They both established the Committee by resolutions that accepted certain terms of reference. If the result is regulation of their members, then both the Association and the Institute should have adopted by-laws which, in turn, would require government sanction. This is a more cumbersome process to be sure, but one that, in the circumstances, would surely have been met with no opposition.

[15] I do not agree with the respondents that s. 8 of the Engineers and Geoscientists Act, R.S.B.C. 1996, c. 116 provided the Association with the necessary authority to proceed by resolution. That section provides:

8 (1) The powers conferred on the association are to be exercised by council.

(2) Subject to this Act and the bylaws of the association, the council

(a) must govern, control and administer the affairs of the association,

(b) must exercise all rights and powers vested in it by this Act or by the bylaws, and

(c) may pass resolutions necessary for the purposes of paragraphs (a) and (b).

[16] It was suggested that the direction that the council of the Association "must govern, control and administer the affairs of the association" gave the Association the right (and obligation in the public interest) to participate in the Committee as part of administering its affairs. I do not accept that the reference to administering its affairs was meant to include establishing with another self governing professional body, a joint body for accrediting its members to do a specialized type of work (for which only engineers and architects can qualify). The Association, through its participation in the Committee, acted through the Committee to govern and control not only its affairs, but those of its members by determining their professional paths. This action amounts to regulation.

[17] The reality is that the Association and the Institute have established a specialty in response to public and professional need and demand. The reality is that neither of their statutes makes provision for doing so. The reality is that the effect of their having done so is to regulate their members in the sense that they are the gatekeepers to those members of the Association and the Institute who wish to practise in the field of BEP in any of the numerous municipalities in British Columbia who have adopted by-laws restricting that work to those who are accredited. I agree that the municipalities who adopted such by-laws are also gatekeepers. But while it is the municipalities who have erected the gate, it is the Association and the Institute, through the Committee, who provide the key. (I use an analogy here for the benefit of counsel who provided me with several during the course of their very able submissions!) Thus, that the actions of the municipalities have the effect of regulating engineers and architects who would do building envelope inspections does not negate the fact that the Association and the Institute, by their creation and administration of an accreditation procedure, have also established a regulatory scheme. It was not open to either the Association or the Institute to establish this scheme by resolution. Thus, neither the Association nor the Institute have lawfully established their accreditation scheme and the Committee has neither the authority to grant, nor the authority to decline, accreditation.

[18] A self-governing profession can act only within those powers conferred on it by its enabling legislation. In Hollenberg v. B.C. Optometric Assoc. et al. (1967), 61 D.L.R. (2d) 295 (B.C.C.A.), Mr. Justice McFarlane, at page 307, noted:

This inquiry should be made bearing in mind the principle that where a statute confers jurisdiction upon a body of limited authority to regulate and discipline a class of persons, the conditions and qualifications annexed by the statute to the exercise of that jurisdiction must be complied with strictly: Harris v. Law Society of Alberta, [1936] 1 D.L.R. 401, [1936] S.C.R. 88.

[19] In neither the Engineers and Geoscientists Act nor the Architects Act, R.S.B.C. 1996, c. 17, is there explicit authority to establish a joint accreditation committee with another professional body. That in these days of increasing interdisciplinary professional practices such authority might be welcome, or even necessary, is beside the point. It is for the legislature to authorize self-governing professions to take such action, however well intended the action is. As Mr. Justice Matheson observed in Ashley v. Assn. of Nova Scotia Land Surveyors (1987), 79 N.S.R. (2d) 435,(N.S.C.T.D) at 442:

The Court has the duty of ensuring that a statutory body does not try to impose its wisdom and thereby exceed its statutory jurisdiction.

[20] That the intentions of the Association and the Institute in establishing the Committee were to serve the best interests of the public can take them only so far (authority such as Jabour v. Law Society of British Columbia et al. (1980), 115 D.L.R. (3d) 549 (B.C.C.A.) notwithstanding). That an action that otherwise lacks jurisdiction is taken in the public interest does not thereby cure the lack of jurisdiction.

[21] The above observations are predicated, of course, on my initial conclusion that the action of the Association and Institute at issue here amount to regulation.

[22] Whether the Association and the Institute can delegate the responsibility to accredit their respective members as BEPs to a joint Committee (even if properly accomplished by by-law) is another question, but one I need not address as the issue put before me is determined by the analysis above.


[23] I conclude that the Association and the Institute lacked the jurisdiction to establish, by resolution, the Committee. Thus all actions taken by the Committee are ultra vires the Association and the Institute. That includes the decision not to grant accreditation as a BEP to Mr. Morton. That decision is set aside.

[24] I do not accept the invitation of Mr. Morton to order the Association and the Institute forthwith to issue a press release advising of the result of this application.

[25] Mr. Morton is entitled to his costs of the application on scale 3.

"T.J. Melnick, J."
The Honourable Mr. Justice T.J. Melnick