WEST PALM BEACH, Fla. — James and Maria Ivory’s dreams of a relaxing retirement on Florida’s Gulf Coast were put on hold when they discovered their new home had been built with Chinese drywall that emits sulfuric fumes and corrodes pipes. It got worse when they asked their insurer for help — and not only was their claim denied, but they’ve been told their entire policy won’t be renewed. Thousands of homeowners nationwide who bought new houses constructed from the defective building materials are finding their hopes dashed, their lives in limbo. And experts warn that cases like the Ivorys’, in which insurers drop policies or send notices of non-renewal based on the presence of the Chinese drywall, will become rampant as insurance companies process the hundreds of claims currently in the pipeline. At least three insurers have already cancelled or refused to renew policies after homeowners sought their help replacing the bad wallboard. Because mortgage companies require homeowners to insure their properties, they are then at risk of foreclosure, yet no law prevents the cancellations. – The Associated Press

Q. This is aside from the grave health risks that appear to be associated with homes with Chinese drywall. Could this happen here?

A. Fortunately, we are covered by a comprehensive home warranty program called Tarion which covers defective workmanship and materials. Any new homes in Ontario that have not been occupied are covered by this warranty (whether the builder is registered under Tarion or not — contrary to last week’s article where I was misinformed).

So presumably, the sulfuric drywall would be replaced under warranty, and it is my understanding that the warranty organization would pursue the builder fairly aggressively for compensation

If a home has been build with contaminated drywall, the entire guts of the house, including any other materials that came into contact with the product would have to be replaced.

One however could imagine some minor repairs being done to an existing structure with this product, which would not be covered by Tarion. It would then be up to the homeowner to pursue the contractor who had used the defective materials for replacement and/or compensation.

It is estimated that approximately 929,000 square meters of Chinese drywall arrived in Canada through Vancouver for use mainly in the B.S. Lower Mainland but some may have reached into the Prairies and even Toronto.

The full effect has yet to be felt in Canada and more specifically in Ontario.

– Jeffrey Cowan is the principal with Cowan Taylor and McGee, Barristers & Solicitors. The information in this article should not be relied upon as legal advice.

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