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The 2024 Ontario Building Code came into effect on January 1, 2025, with a three-month grace period until March 31, 2025 for certain designs that are already underway. As municipalities and applicants transition to using the new code by April 1, we are taking the opportunity to reflect on a 2024 court case regarding building permits.
Considering the significant housing targets for Ontario municipalities over the next 10 years and expected building activity, it is important to remain aware and better understand a municipality’s obligations and liability when it comes to building inspections and powers. In 2024, the Ontario Superior Court ruled that municipalities have an ongoing duty to monitor open building permit files until all necessary inspections to enforce the Ontario Building Code (OBC) are completed.
Ruling
In Huether v. Sharpe, 2024 ONSC 1987, the court ruled that the Township of McMurrich Monteith has a statutory obligation to protect the health and safety of the public by enforcing minimum construction standards for buildings. With no final inspections carried out, the Township’s duty of care in these particular circumstances was to monitor its open permit file continuously and to follow up with the permit holder regarding the state of construction. Its duty to monitor continued until the chief building official (CBO) determined that the building was substantially complete and satisfied the occupancy conditions.
Impact
Based on the ruling, municipalities have an ongoing duty to monitor permit files and enforce building codes. The duty goes beyond the initial completion of construction, potentially affecting the ultimate limitation period for building claims against municipalities. Municipalities may need to reconsider their building permit and inspection processes and assess the municipal liability for past permits. It will also be important to evaluate building staffing requirements alongside the expected increase in activity. Members may need to consult with their municipality's legal services to understand how this case may impact local building permits.
Case Background
In May 1986, the defendant Township issued a building permit to construct a house on a property. Throughout 1986, after some construction, the Township completed an inspection, noting deficiencies and issuing an Order to Comply. While documents to follow include a handwritten note, “all complied with” and a treasurer’s certificate indicating no outstanding work orders against the property, there was no evidence of a final inspection for occupancy. The property changed owners multiple times and was purchased by the plaintiffs in October 2021.
In February 2022, the plaintiffs commenced action against the Township alleging negligence in monitoring its open permit file and carrying out all required inspections. The Township claimed that the alleged negligence occurred over 36 years ago and that the 15-year limitation period expired.
Given that the court found the treasurer did not have the authority to determine if a building permit was closed, the permit was still open.