As of August 16, 2017:

In the insolvency proceeding for Urbancorp (Bridlepath) Inc. and Urbancorp (Woodbine) Inc., the court has recently approved certain interim distributions to creditors.  This means that purchasers who have made claims in the proceeding may be receiving a portion of their deposit monies at this time.  Further distributions to creditors will be made as the proceeding progresses, so purchasers may receive more of their deposit monies.  Purchasers who do not receive a full refund of their deposit monies from Urbancorp in the proceeding can make a deposit refund claim to Tarion.  Any claims received by Tarion will be processed once the final distributions have been made in the proceeding.   ​

For information about deposits, please see the 'Deposit and Deposit Protection with Tarion' section below.

As of May 16, 2017:

Warranty coverage for delayed closing is set out in the Addendum attached to the purchase agreement.  If you are otherwise eligible for delay compensation, section 7 of the Addendum provides that delayed closing compensation is payable to a purchaser only if: (i) closing occurs; or (ii) the purchase agreement was terminated by the purchaser in accordance with the Addendum. 

If your purchase agreement with Urbancorp has been disclaimed as a result of an insolvency proceeding, closing will not occur.  You may, however, be entitled to delayed closing compensation if you terminated your purchase agreement with Urbancorp in accordance with the Addendum.

The delayed closing warranty is provided by the vendor of the home.  If you are entitled to delayed closing compensation, you should include it in your claim against Urbancorp in the insolvency proceeding.  The warranty is back-stopped by Tarion so, if you are entitled to delayed closing compensation and do not receive it from Urbancorp, you may submit a delayed closing compensation claim in writing to Tarion within one year after you terminated your purchase agreement in accordance with the Addendum.

 

As of February 15, 2017:

On March 4, 2016, Tarion issued Notices of Proposal to revoke or refuse to renew the registrations of 17 Urbancorp companies.  Urbancorp appealed all of the Notices of Proposal to the Licence Appeal Tribunal on March 18, 2016. 

In May, the following companies chose to allow their registrations to expire, which means they are no longer able to build or sell new homes in Ontario: 

  • Urbancorp (St. Clair Village) Inc.
  • Urbancorp (Lawrence) Inc.
  • Urbancorp (Woodbine) Inc.
  • Urbancorp (Bridlepath) Inc.
  • Urbancorp (Mallow) Inc.
  • Urbancorp (Patricia) Inc.

The registrations and appeals of the other 11 companies continued.

However, on October 5, 2016, Urbancorp withdrew 10 of the remaining appeals.  This allowed Tarion to carry out its proposals to revoke or refuse the registrations.  As a result, the following companies are no longer registered with Tarion and cannot build or sell new homes in Ontario:

  • Westside Gallery Lofts Inc.
  • Urbancorp Communities Inc.
  • Urbancorp (Leslieville) Developments Inc.
  • Urbancorp (The Beach) Developments Inc.
  • Urbancorp (Riverdale) Developments Inc.
  • Bridge On King Inc.
  • Fuzion Downtown Development Inc.
  • Edge on Triangle Park Inc.
  • Urbancorp (St. Clair West) Inc.
  • Urbancorp (952 Queen West) Inc.

Although these companies are no longer registered with Tarion, they remain obligated to fulfill their commitments to their customers.  This includes addressing warranty claims, seeking registration for any current condominium projects and completing any existing sales.

It is important for new home buyers and new home owners to know that they remain protected under the warranty, and Tarion will step in to fulfill the warranty obligations if Urbancorp fails to do so.  This includes deposit protection, delay compensation and construction warranties that can last up to seven years on a new home.

For information about deposits, please see the 'Deposit and Deposit Protection with Tarion' section below.

One Urbancorp company, Epic on Triangle Park Inc., has had a material change in circumstances since the Notice of Proposal was issued.   The company replaced its officer and director, is willing and able to provide warranty service and meets the statutory criteria for registration.  Tarion has, therefore, withdrawn its proposal and Epic on Triangle Park Inc. continues to be registered and can build and sell new homes.

Please contact Tarion if you have any questions.  Tarion has set up a special customer service team to specifically serve Urbancorp purchasers and homeowners.  There are two ways for you to contact Tarion:

  • Fill out the form below, or
  • Call us at 1-877-982-7466 and indicate that you are calling about Urbancorp.  We will make sure you speak to an informed representative.

 

As of September 6, 2016, Dickinson Wright LLP was appointed representative counsel for purchasers in the insolvency proceedings of the following Urbancorp companies:

  • Urbancorp (Lawrence) Inc.
  • Urbancorp (St. Clair Village) Inc.
  • Urbancorp (Woodbine) Inc.
  • Urbancorp (Bridlepath) Inc.

Additional public information about the court's decision to appoint representative counsel can be found here.

If you have purchased a home from one of these companies and would like more information about representation in the insolvency proceedings, you can contact Lisa Corne or David Preger of Dickinson Wright LLP

 

As of August 18, 2016, Urbancorp’s financial situation is still before the courts. This includes the Companies’ Creditors Arrangement Act (CCAA) proceedings, the restructuring under the Bankruptcy and Insolvency Act (BIA), and the Licence Appeal Tribunal (LAT) hearings. Until these processes are seen through, despite recent media reports, there can be no determination on whether Urbancorp buyers will lose their homes or a portion of their deposits.
 

Deposits and Deposit Protection with Tarion

A few recent media reports have questioned the adequacy of Ontario's deposit protection of $40,000 for freehold homes. One suggestion has been made to raise the protection as high as $200,000 for freehold homes.  This view has been advanced without any supporting research on actual claims data. In contrast, Tarion regularly monitors all of our claims data to ensure the warranty remains effective. Last year, we reviewed deposit claims over a five year period and found that the average claim was only $29,000 – well within the $40,000 limit.  Significantly raising the limits of Ontario's deposit warranty would very likely result in a significant enrolment fee increase for all new homes across the province, and could have the unintended consequence of increasing deposit amounts requested by builders.  Tarion provides protection to the entire province, and the deposit protection has been largely adequate based on our data. With the average deposit claim being within the $40,000 limit, the rest of the province would be subsidizing the GTA.

We have already acknowledged publicly that the Urbancorp situation will lead to a review of our processes and warranty provisions to determine how we can strengthen the warranty program overall, better protect Ontario home buyers in the future, and remain cost-effective.

Exactly how Urbancorp purchasers will be financially impacted is still unclear, but some of the heavy emotional cost is already known to us.  We recognize how difficult and stressful this situation is, and continues to be for these families.  That is why it so important to set the record straight and to be very clear that what will happen to purchasers’ deposits is still unknown. 

We understand that some Urbancorp buyers could be facing a partial loss of their deposits. Some of these deposit funds may still be recoverable through participation in the ongoing CCAA and BIA proceedings. We encourage home buyers to seek the advice of an experienced real estate lawyer to make sure they can access any money that may be available to them through these proceedings.

In the meantime, and for the past 40 years in fact, Ontario’s new home warranty program has been here for new home buyers as soon as they sign an Agreement of Purchase and Sale, and will step in for the first seven years of their new homeownership experience if their builder is not there for them.

 

Licence Appeal Tribunal Hearings

The Licence Appeal Tribunal (LAT) hearings for the following Urbancorp companies have been scheduled to begin in October 2016:

  • Bridge on King Inc.
  • Edge on Triangle Park Inc.
  • Epic on Triangle Park Inc.
  • Fuzion Downtown Development Inc.
  • Urbancorp (952 Queen West) Inc.
  • Urbancorp (St. Clair West) Inc.
  • Urbancorp Communities Inc.
  • Westside Gallery Lofts Inc.

LAT is an independent adjudicative agency created by the Ontario government.  For more information about LAT and the appeal process click here.

The appeal process usually takes several months to complete.  During this time, purchasers and owners of Urbancorp homes can call Tarion for any warranty-related issues.  Tarion has set up a special customer service team to specifically serve Urbancorp purchasers and homeowners.  There are two ways for you to contact Tarion:

  • Fill out the form below, or
  • Call us at 1-877-982-7466 and indicate that you are calling about Urbancorp.  We will make sure you speak to an informed representative.

  

 

On June 24, 2016, an advertisement appeared in the Globe and Mail issuing a "notice of claims process for Urbancorp Inc. pursuant to the Companies' Creditors Arrangement Act."  This notice does not relate to the Tarion new home warranty claims process or the warranty protection available to Urbancorp customers under the Ontario New Home Warranties Plan Act.  

Tarion has set up a special customer service team to specifically serve Urbancorp purchasers and homeowners.  There are two ways for you to contact Tarion:

  • Fill out the form below, or
  • Call us at 1-877-982-7466 and indicate that you are calling about Urbancorp.  We will make sure you speak to an informed representative.

 

As of June 2, 2016, six Urbancorp related companies have withdrawn both their appeal to Tarion's Notices of Proposal to revoke their registrations as well as their applications to renew their registrations.  As a result, the registrations of the following six companies are deemed to have expired:

  • Urbancorp (St. Clair Village) Inc.

  • Urbancorp (Lawrence) Inc.

  • Urbancorp (Woodbine) Inc.

  • Urbancorp (Bridlepath) Inc.

  • Urbancorp (Mallow) Inc.

  • Urbancorp (Patricia) Inc.

All six companies were involved in sales of new freehold homes where there had been limited or no construction to date.  Without registration, these projects cannot be completed by the company in question.  Be advised that no further sales should occur for these projects since the builder is no longer registered.  Purchasers for these projects are advised to seek legal counsel from an experienced real estate lawyer.  Further information, including details about Tarion’s deposit protection warranty, is available through our office. 

  • Fill out the form below, or

  • Call us at 1-877-982-7466 and indicate you are calling about Urbancorp.  We will make sure you speak to an informed representative.

 

As of May 31, 2016, the following three Urbancorp related companies have entered into receivership:

  • Urbancorp (Leslieville) Developments Inc.

  • Urbancorp (Riverdale) Developments Inc.

  • Urbancorp (The Beach) Developments Inc.

Receivership is a legal remedy available to secured creditors to recover outstanding monies owed by a debtor company to the secured creditor.  Tarion’s Notices of Proposal for these companies and their subsequent appeals have been stayed by the receivership proceeding. Additional public information about the receivership proceeding for these three Urbancorp related companies, including the receivers appointed, can be found online at: http://www.alvarezandmarsal.com/urbancorp.

Restructuring proceedings under the Bankruptcy and Insolvency Act for the following companies continues:

  • Edge on Triangle Park Inc.

  • Urbancorp (St. Clair West) Inc.

  • Urbancorp Communities Inc.

  • Urbancorp (Woodbine) Inc.

  • Urbancorp (Bridlepath) Inc.


Restructuring proceedings under the Companies’ Creditors Arrangement Act for the following companies continues:

  • Bridge on King Inc.

  • Urbancorp (952 Queen West) Inc.

  • Urbancorp (St. Clair Village) Inc.

  • Urbancorp (Lawrence) Inc.

  • Urbancorp (Mallow) Inc.

  • Urbancorp (Patricia) Inc.

Additional public information about the creditor protection proceedings for the companies noted above can be found online at:  http://www.ksvadvisory.com/insolvency-cases-2/urbancorp/ and http://fullerllp.com/selected-active-engagements/

Tarion continues to gather more information about the process and will share any relevant details as they become available.

 

Important Information About Urbancorp

In March 2016 Tarion issued Notices of Proposal (NOP) to revoke the registrations of 17 Urbancorp related companies.  As the Registrar, Tarion requires builders to adhere to certain requirements in order to obtain and maintain a registration under the Ontario New Home Warranties Plan Act.  The decision to issue this NOP was made due to the failure of the Urbancorp related companies to meet Tarion's ongoing registration requirements.

As with all builders who are issued an NOP by Tarion, Urbancorp companies had the right to appeal this proposal to the Licence Appeal Tribunal (LAT), which they did.  For those Urbancorp related companies whose registration has not now expired or are not impacted by receivership proceedings, these NOP Appeals are still in process.  During this time, the subject Urbancorp related remain registered under Tarion until the LAT appeal process is concluded. 

Despite an NOP, a builder remains obligated to fulfill its commitments to its customers.  This includes addressing warranty claims, seeking registration for any current condominium projects and completing any existing sales.

It is important for home buyers and homeowners to know that they remain protected under the warranty, and Tarion will step in to fulfill the warranty obligations if Urbancorp fails to do so.  This includes deposit protection, delay compensation and construction warranties that can last up to seven years on a new home.


Frequently Asked Questions

What should home buyers do?

For those Urbancorp related companies whose registration has expired, purchasers are strongly advised to seek legal advice.  Information is also available through the court-appointed officers and through Tarion.  You can read about Tarion’s Deposit Protection Warranty here or contact us directly.or contact us directly.

For those Urbancorp related companies currently under receivership, purchasers and homeowners are strongly advised to seek the advice of an experienced real estate lawyer.  You can also contact Tarion directly for more information to understand how best to preserve your warranty rights.

For those Urbancorp related companies that remain registered, the company remains obligated to fulfill its warranty commitments to its customers.  This includes addressing warranty claims, seeking registration for any current condominium projects and completing any existing sales.

Tarion will step in to fulfill the warranty obligations if Urbancorp fails to do so.

Tarion has set up a special customer service team to specifically serve Urbancorp purchasers and homeowners.  There are two ways for you to contact Tarion:

  • Fill out the form below, or

  • Call us at 1-877-982-7466 and indicate you are calling about Urbancorp.  We will make sure you speak to an informed representative.

We recommend that Urbancorp home buyers and homeowners with questions that relate to their specific agreements seek the advice of a real estate lawyer.

Can Urbancorp continue building while they appeal the Notice of Proposal?

During the LAT appeal process, Urbancorp will remain registered and obligated to complete current projects. Tarion will not approve any new Urbancorp projects until the appeal process is completed.

 

Where can I get more information about Urbancorp?

Tarion has set up a special customer service team to specifically serve Urbancorp home buyers and homeowners.  There are two ways for you to contact Tarion

  • Fill out the form below, or

  • Call us at 1-877-982-7466 and indicate you are calling about Urbancorp.  We will make sure you speak to an informed representative.

Also, the Ontario Builder Directory has been updated to reflect the registration status of all 17 Urbancorp related companies.

Public information about Urbancorp's insolvency proceedings can be found here.

Where can I get more information about the warranty?

Click here to read the Homeowner Information Package, which provides more details about the warranty, and how to submit a claim.

 


What does it mean if my builder has filed for protection from creditors?

Proceedings under the Companies’ Creditors Arrangement Act or the Bankruptcy and Insolvency Act can be very complex and can take on different forms.  The best advice for purchasers is to monitor the proceedings and retain legal counsel so that they are aware of all of their legal options.

Generally, these proceedings may allow a financially troubled builder the opportunity to restructure its affairs under court protection.  They may result in bankruptcy and/or the liquidation of the builder’s assets under the supervision of a licensed trustee-in-bankruptcy.  Some very general thoughts to bear in mind include:

  • These proceedings may provide the builder with a “stay of proceedings” for a temporary period of time, during which time creditors and others may be barred from taking certain steps against the builder.
  • There may be opportunities for creditors, such as purchasers, to participate in these proceedings.
  • Purchasers may contact court-appointed officials directly with any questions that they may have and websites are often maintained in respect of ongoing proceedings.  These websites are an additional source of information about the proceedings.
  • Secured creditors, including mortgage lenders and construction lien claimants, will have different rights than unsecured creditors.  In certain cases, purchasers’ agreements of purchase and sale may be terminated by the builder or by the court-appointed trustee.
  • If agreements of purchase and sale are terminated or the builder becomes bankrupt and/or there is a liquidation of the builder’s assets under the supervision the trustee, then generally the recourse for purchasers is to seek return of their deposits.
    • For new home purchases involving condominiums, there are deposit protection provisions in the Condominium Act, which should mean that there is backstop coverage for all deposit monies paid.  That backstop coverage may take different forms.  Deposit funds may continue to be held in a trust account with a prescribed trustee.  Some or all of the deposit monies may instead be backstopped by alternative prescribed security, such as Tarion’s backstop protection for up to $20,000 and, for additional amounts, excess deposit insurance provided by a private insurance company.
    • For homes other than condominiums (e.g., freehold homes) the backstop protection for deposits is the statutory right of compensation administered by Tarion under the Ontario New Home Warranties Plan Act for up to $40,000 per home.
    • In most cases the backstop protection noted above relates to “deposit” monies paid toward the purchase price in the agreement of purchase and sale.  As a general rule, this does not include monies paid for upgrades and extras.  For such upgrades and extras, the purchaser may have claims against the builder that may be dealt with under these proceedings.

 

Additional questions or concerns?  Please fill out the form below:

Important Note: This is provided for general information purposes only and does not constitute legal or other professional advice. You are advised to seek specific legal advice from your own legal counsel regarding any specific legal issues. Tarion does not warrant or guarantee the quality, accuracy or completeness of any of this information. If there is any conflict or inconsistency between the Ontario New Home Warranties Plan Act and this information, the Act supersedes this information.