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(Copyright 2001 by Dr. James Balderson – See Copyright Notice Below)

“Mind-boggling condo market is full of bafflegab”

Investigation of tricky condo market leads to complaints against realtors for using false advertising to sell new condos

False advertising complaints are being filed with
(1) The Real Estate Council of British Columbia,
(2) The Federal Competition Bureau in Ottawa,
(3) The Better Business Bureau
against three real estate companies and licensees with
(1) Pinecrest Management Ltd. d/b/a Raven Woods Realty,
(2) Sutton-Broadview Realty Ltd. d/b/a Sutton Group Broadview Realty,
(3) MacDonald Realty (1974) Ltd.

James Balderson of the Coalition of Leaky Condo Owners (COLCO) is filing the   complaints based on information discovered during COLCO’s continuing investigation of realtors, architects, developers, and builders involved with building and selling leaky rotten condos.

The allegations state that developers and real estate licensees participated in providing false, misleading and deceptive information regarding warranty coverage on condominiums and false, misleading and deceptive information regarding the reputation of developers.

The complaints involve the promotion for sale of two new condominium projects, one in North Vancouver (Seasons at Raven Woods) and one in Vancouver (Chelsea Southland).

The Real Estate Council of British Columbia
Telephone 604-683-9664
Toll-free 1-877-683-9664

“The Real Estate Council of British Columbia is a body established under the Real Estate Act of British Columbia.  In conjunction with the Superintendent of Real Estate, the Council administers and enforces the Real Estate Act.  The purpose of the Real Estate Act is to protect the public.” 

The Competition Bureau

“The Competition Bureau is an organizational unit of the federal Industry Department and is headed by the Commissioner of Competition, Mr. Konrad von Finckenstein.  In Mr. Von Finckenstein’s view, the Bureau’s mandate is to ensure that Canadian businesses are in conformity with the laws under its jurisdiction.  The Fair Practices Branch of the Bureau promotes fair competition in the marketplace by discouraging deceptive business practices and by encouraging provision of sufficient information to enable informed consumer choice.  The Branch applies the provisions of the Competition Act that deal with false or misleading advertising and other deceptive practices.”

The Better Business Bureau
Telephone 604-682-2711

“The Better Business Bureau of Mainland British Columbia aims “to promote, develop and encourage an ethical marketplace.  The BBB is a private nonprofit, self-regulatory organization, dedicated to promoting fairness and honesty in the marketplace.  Back in 1906, the Coca-Cola Company was hauled into court to answer charges of false advertising.  A remark during the trial by Coca-Cola’s own attorney “Why all advertising is exaggerated.  Nobody really believes it.” Led to the founding of what is known today as the Better Business Bureau.” 

London Guarantee
Telephone 604-682-3095

London Guarantee is one of five home warranty companies currently connected to insurance companies authorized by the B.C. Financial Institutions Commission to do business in British Columbia.

London Guarantee’s website states:  “London Guarantee is a Canadian-owned property and casualty insurer. … [London guarantee was] the first insurer to enter the home warranty market in British Columbia following the introduction of legislation under the Homeowner Protection Act & it Regulations (‘Act’) effective July 1, 1999.”

London Guarantee is part of the Great-West Life group of companies and a member of the Canadian Home Builders Association.

“Utilizing the experience and knowledge of a dedicated group of underwriters and field staff, we [at London Guarantee] focus on the risk evaluation process while working to develop and maintain strong relationships with the building community.”  (See more below about “strong relationships with the building community.)

“[We at London Guarantee] encourage you to carefully research all aspects [of your new home] and to seek professional advice when required.”

“Prior to signing a Contract of Purchase and Sale, it is also prudent to contact London Guarantee to verify the Builder is officially registered AND that home warranty coverage has been issued on your prospective new home.” (Emphasis in original.)

Although COLCO did not visit the London Guarantee website until after this investigation was well underway, it appears that COLCO was doing exactly what London Guarantee advocates, that is, trying to check and verify every piece of information regarding the Seasons at Raven Woods and Chelsea Southlands.

London Guarantee’s website also states: “Stringent Underwriting Criteria: London Guarantee thoroughly reviews all builder applicants in the area of track record, technical expertise, financial capacity, and after sales customer service.  Not every applicant qualifies.  Only those who meet our stringent underwriting criteria are able to provide London guarantee’s home warranty coverage.  The annual renewal of a builder’s registration is subject to a similar review. HPO also monitors builders throughout the province and investigates consumer complaints.”

“We have firmly established a reputation for employing highly experienced staff, implementing strong underwriting guidelines, and delivering exceptional customer service.  London Guarantee is fully committed to the home warranty business long term.” (Emphasis in original.)

COLCO has noted a striking similarity in the phrasing used by London guarantee and the bankrupt New home Warranty Program.  (See more below.) 

Advertised warranty vanishes upon inquiry

COLCO investigators found that licensed realty agents and companies advertised and otherwise told prospective purchasers that the condo projects (seasons at Raven Woods and Chelsea Southlands) were covered by warranties from London Guarantee.

The COLCO investigation revealed that the condo projects were not enrolled with London Guarantee’s third-party warranty program.

COLCO informed Ed Tsumura, London Guarantee’s Manager of Underwriting, of the false advertising in December 2000.

Ed Tsumura was previously Manager of Underwriting for the bankrupt New Home Warranty Program.  He was the “temporary” Registrar for the new Home Owner Protection Office.  Several other former New Home Warranty employees are with London Guarantee.  (See below for more interconnections.)

Upon receiving information from COLCO about the advertisements and that London Guarantee records available to the public indicated that the two projects were not covered by London Guarantee warranties, London Guarantee conducted its own investigation.

“Cease and desist”

London Guarantee reported to COLCO on January 4, 2000, that London Guarantee had issued a “cease and desist” letter to Raven Woods on January 04, 2001.

London Guarantee also reported to COLCO that the developer of Chelsea Southlands “enrolled” Chelsea Southlands with London Guarantee upon notice of a forthcoming “cease and desist” letter.

COLCO is not entirely clear what the term “enrolled” means.  For example, can the warranty be withdrawn prior to or after a “commitment to purchase”?

The Barrett Commission

The Barrett Commission of Inquiry into the Quality of Residential Construction (Barrett Commission) found the industry was rife with negligence and incompetence.  Readers are advised to obtain a complete set of the Commission’s publications, Part I and Part II, including the published volume of  “Documents”. (Call Enquiry B.C. at 660-2421 or 1-800-663-7867.  The report is also available at www.hpo.bc.ca.) 

New legislation and regulations were brought into effect requiring mandatory warranties on new homes and on major repairs to leaky rotten condos and other homes.

The Homeowner Protection Office
Telephone toll free 1-800-407-7757

The Homeowner Protection Office (HPO) is a provincial Crown corporation formed as a response to many of the recommendations from the original Barrett Commission report on the quality of condominium construction in British Columbia.

The report prompted the development of the Homeowner Protection Act  which passed on July 28, 1998 for the main purposes of strengthening consumer protection for buyers of new homes and improving the quality of residential construction in the province.  The Act provided for the creation of the HPO. Which officially opened on October 1, 1998.

As of January 02, 2001, The HPO had received 5,915 applications for the zero-interest loan program available to means-tested qualified owners of leaky rotten condominiums.  The HPO had approved $102,638,249 in loans.

COLCO advocates zero-interest, zero-payment reconstruction loans for all residential (non-commercial) owners of leaky rotten condos with the loans forgiven over time.  (See www.myleakycondo.com.)

New Home Warranty & Canadian Home Builders Association
www.nhwp.com & www.chbabc.org

The importance of warranties to homeowners was emphasized when The New Home Warranty Program of B.C. and the Yukon (NHW) collapsed in April 1999 because it was unable to pay mounting claims from leaky condo owners due to poor underwriting policies and practices, inadequate actuarial procedures and incompetent management practices which were reviewed and authorized by the Board of Directors on behalf of the sole and controlling shareholder (CHBA-BC).

NHW mismanaged the viability of NHW by charging too little for warranties, using faulty underwriting and actuarial practices, failing to weed out bad developers and by funneling money from NHW to the Canadian Homebuilders’ Association British Columbia (CHBA-BC), the sole shareholder, directly and indirectly through the Residential Construction Institute which was set up as a device to avoid attacks by Federal Income Tax Officers. 

The New Home Warranty Program was owned, controlled and directed by CHBA-BC. CHBA-BC operates from offices located at the Burnaby Campus of the British Columbia Institute of Technology.  Money from New Home Warranty was paid for the CHBA-BC offices and constituted a direct benefit to CHBA-BC, including continuing free rent for office space.

CHBA-BC members built thousands of leaky rotten condos, many of which were enrolled with the New Home Warranty Program. 

False RCMP investigation of New Home Warranty

The Royal Canadian Mounted Police announced they had concluded an investigation of New Home Warranty. COLCO investigators met with the RCMP and determined that the RCMP did not conduct an investigation of the available records and documents.   They appear to have simply read a portion of the Barrett Commission Report.  The RCMP refused to provide a copy of the internal RCMP report to COLCO.

COLCO continues to call for an audit and complete public investigation of New Home Warranty records, including the flow of money to RCI and CHBA-BC, and individual members of CHBA-BC.

 See www.myleakycondo.com for more information on this topic.

Complaints to Office of the Ombudsman

COLCO investigators registered two complaints with the Office of the Ombudsman.

One dealt with the government’s delay in submitting the portion of the Barrett Commission Report that dealt with the financial collapse of New Home Warranty to the legislature in accordance with the Public Inquiries Act.  This matter remains outstanding.

The other complaint dealt with the non-investigation of New Home Warranty by the RCMP and the government.  This matter remains outstanding.

Visit www.myleakycondo.com for updates on these complaints.

Warranty confusion

As a result of the Barrett Commission and subsequent provincial government legislation, “arms length” warranties from regulated and approved warranty providers are now mandatory on homes constructed with municipal building permits approved after July 1, 1999.

The condo projects involved in the complaints filed as a result of this investigation were built with permits dated before July 1, 1999.  The provision of a third party warranty is voluntary for such projects.  Developers selling such projects offer various warranties with various terms and conditions.

The Homeowner Protection Office requires that developers provide a “Notice of Warranty.”

The Real Estate Council of British Columbia acknowledged the confusion about warranties by issuing and recommending the following model clause to licensees in the fall of 2000 for insertion into contracts of purchase and sale:

 Buyer acknowledges having received and having had an opportunity to read a Notice of Home Warranty and a copy of any warranty coverage applicable to the construction of the home. 
The Real Estate Council also advised licensees as follows:
"Licensees should encourage buyers to seek independent legal advice as to these warranty provisions."
There is confusion over when a developer is required to provide a “Notice of Warranty.”  COLCO recommends that purchasers receive, study and compare all warranty information before making an offer to purchase.

There is confusion over whether a warranty can be provided (or promised without being subject to change) before a condo is built and approved for an occupancy permit and subsequently approved by the warranty company as being built in accordance with the warranty company’s requirements.

The confusion over warranties is one aspect of the tricky condo market being investigated by COLCO.  COLCO expects to release further information regarding warranties later this year.

Condo Guide
Telephone 604-519-6080

Condo Guide is self-described as follows: published every second Friday and distributed as a free publication to 1,500 locations in the Lower Mainland and Fraser Valley with a total distribution of 30,000 copies.  It is part of a larger complex company.  (Telephone 604-519-6080.)

Condo Guide is a member of The Greater Vancouver Home Builders Association (GVHBA).  GVHBA is a major influential local of the Canadian Home Builders Association-British Columbia.  (See more below.)

Seasons at Raven Woods 
Telephone 604-929-1915

As part of an ongoing investigation, COLCO attempted to verify information from an advertisement for Seasons at Raven Woods.  The ad appeared in Condo Guide (Volume 8, Issue 24, November 17-December 1, 2000, p.38).

The full-page advertisement displayed a London Guarantee Warranty Logo with the words “Warranty Coverage London Guarantee”.

Raven Woods Realty
Telephone 604-929-8332

The ad also carried a logo for Raven Woods Realty.

An examination of Real Estate Council records revealed that Raven Woods Realty Ltd. is part of Pinecrest Management Ltd.  COLCO was informed by the developer’s office that Harry Wong is President of Pinecrest.  This has not been verified.

COLCO has not researched public corporate records for Pinecrest Management yet.

The Real Estate Council lists three licensees with Raven Woods Realty: John Geoffrey (SA), Lorna Tamara (SR) and Harry Wong (NM).

Raven Woods Realty can be contacted at 700 Apex Avenue, North Vancouver, BC, V7H 2R5, Telephone 604-929-8332.

An elaboration of the false information regarding London Guarantee’s warranty at Seasons was found in a Condo Guide Editorial by Bill Kimmett who stated: “In addition, the residences are covered by the 1/5/10 warranty program from London Guarantee,” (Condo Guide, December 15-29, 2000, p.13.)

When contacted by COLCO, Bill Kimmett explained that he does not independently verify the information in his Condo Guide Editorials but instead “relies on information supplied by the developers, sales people, marketers and real estate people”.  Kimmett requested that we do not provide his name in this report.  (Bill Kimmett, Telephone 604-921-7302, email: bill@memory-catcher.com.)

A “mystery” member of COLCO called the sales office at the Seasons and spoke to a man identified as “Geoff.”  The COLCO member requested “further information regarding the London Guarantee warranty”.  COLCO then received a one-page description of the warranty information by fax.  The information was provided on London Guarantee letterhead.  This information was forwarded by COLCO to London Guarantee.

The duration of warranty information had been altered by hand as follows: “1/3/10” had been changed to “1/5/10”, i.e., altered to read “1Year Workmanship Warranty and Materials/5Year Water Penetration Warranty/10 Year Structural Defects Warranty”.

Sutton Group – Broadview Realty
Telephone 604-738-1000

COLCO also found an earlier addition of Condo Guide (Volume 8, Issue 21, October 6-October 20, 2000) containing a Sutton logo with the statement “Sales by Sutton Broadview Realty.”

Real Estate Council records revealed Sutton Broadview Realty was registered as Broadview Realty Ltd. d/b/a Sutton Group Broadview Realty, with Victor Jang as Nominee. 

COLCO contacted Victor Jang, Sales Manager, of Sutton Broadview (Telephone 604-738-1000, email: vjang@sutton.com) who referred COLCO to “Alan DeGenova, the listing agent for the project.”

Alan DeGenova informed COLCO during a telephone interview that he was a very busy man and that he and Sutton had no further interest in the project as of early December, 2000.  COLCO explained that COLCO was very busy trying to investigate the role of realtors in the tricky condo market. Mr. DeGenova became more interested in 
COLCO’s inquiry when told that COLCO was investigating Sutton for false advertising. 

Mr. DeGenova told COLCO that he was surprised at learning Seasons at Raven Woods was not covered by a London Guarantee home warranty.  He mentioned that the developer supplied the warranty information to him.  He said he was a “good personal friend” of Ed Tsumara of London Guarantee and that he recalled that Tsumara had told him the warranty was in place.  Mr. DeGenova said he would call Tsumara that evening to determine if COLCO’s information was correct.  Mr. DeGenova did not report to COLCO what he learned upon talking with Tsumara following the interview.

During the course of the conversation, Mr. DeGenova also mentioned that he understood that “problems with the condos at Raven Woods had been fixed by the developer.”  COLCO is following up on this comment to determine the nature of problems, if any, at Raven Woods. 

Native Band Land

The Seasons at Raven Woods is part of the Raven Woods development on the north shore of Burrard Inlet, east of the Iron Workers’ Memorial Bridge.

Raven Woods is on native land reserved for the Tsleil-Waututh (the Burrard Band).
Native land is considered as federal land.  Developments on native land do not fall under the jurisdiction of the province.

Condo developments on native land, like Raven Woods, do not have to meet the requirements of the Homeowner Protection Act, which is provincial legislation.

The purchasers of condos on native land do not receive freehold title.  Purchasers do not buy the land.  The land for the condos at Raven Woods is leased from the band.  (See news reports and court decisions regarding native band land leased to tenants by the Musqueam band.) 

Takaya, Chief Leonard George, Kuok Group and CDNX:NSL

The Raven Woods website identified the developer as Takaya Developments Ltd.  The spelling of “Takaya” on the website varies, including “TAKaya”, the “Takaya” form was adopted for this paper.

Expired HPO license

COLCO’s examination of the HPO Public Registry of Licensed Residential Builders revealed that Takaya Developments #2 Partnership was registered as a Licensed Residential Builder but that the license had expired.

Chief Leonard George

The Licensee for Takaya was Leonard George with License No. 20220.  The registered address was 700 Apex Avenue, North Vancouver, B.C., V7H 2R7, Telephone 604-924-2338. 

Chief Leonard George assures visitors to the website that “The homes are of the highest quality ….”  There is nothing to indicate that Chief George is an expert in determining the quality of the homes at Raven Woods.


According to the website, Takaya Developments Ltd. is the General Partner of the limited partnership, and is responsible for all aspects of the development.

The shareholders of Takaya Developments Ltd. are stated to include Dartburn (B.C.) Ltd., part of the Kuok Group, and Native Strategic Investments Ltd. (“NSI”)

Kuok Group

The Kuok Group is described as “…one of Asia’s most diversified and dynamic enterprises. Grounded by core values of integrity, loyalty and discipline, the company rose from humble beginnings in 1949 to become a worldwide conglomerate spanning industries from manufacturing and shipping to hotels and real estate.”

COLCO has not verified whether the Kuok Group is still affiliated with Takaya and Raven Woods.

COLCO members have learned that it doesn’t seem to matter if the developer of a condo project is “connected” to firms such as the so-called Kuok Group.  The industry is structured using a series of limited liability companies, some with names, some with numbers only.  Once “sold-out” the development company is usually left with no assets.  Potential purchasers may want to inquire about the degree to which Kuok will “stand behind” Raven Woods.  COLCO is still trying to get reliable answers.

Native Strategic Investments (NSI)

According to the website, “Native Strategic Investments Ltd. (NSI) was founded in 1993 with the goal of creating high quality real estate developments in partnership with First Nations bands around the Lower Mainland. The company was instrumental in establishing Takaya Developments, responsible for a series of highly successful developments on the North Shore: The Raven Woods Townhomes, Legend, Windsong (Phases 1,2,and 3), Deerfield and Deerfield by the Sea.  All of these communities helped establish Takaya’s reputation for high quality construction and innovative design, and the homes sold out long before construction was complete.  Native Strategic Investments is now expanding beyond real estate into many other aspects of native economic development.  The company is listed on the Canadian Venture Stock Exchange under the symbol NSL.”

The website proclaims that Raven Woods is “Built By An Award Winning Team.”

“Takaya Developments Ltd. has carefully selected a team of leading B.C. professionals.”

The team includes Howard Bingham Hill Architects, identified as a Georgie Award Winner.  COLCO is attempting to determine the involvement, if any, of these architects in designing leaky rotten condos. 

The team also includes Gordon Spratt & Associates Ltd. as Building Envelope Consultant.  COLCO has determined that Gordon Spratt & Associates have been involved as the original building envelope consultant for new leaky rotten condos and also as the consultant for leaky repairs to leaky rotten condos.

A call to Takaya (604-924-2338) on January 11, 2001, revealed that The Seasons at Raven Woods had not been built yet.  It was still in the contract tender stage.  No one in sales had mentioned this fact during several previous calls to the Raven Woods Realty sales office for the Seasons.  DeGenova of Sutton was “fairly certain” it had not been built yet.  Ed Tsumara of London guarantee indicated that he would be checking with the developer regarding whether the project had been started because he was not sure without checking.

During the investigation COLCO was unable to determine from the website that Seasons at Raven Woods had not been built.  (Of course the website may be “revised” at any time.)


On January 13, just prior to releasing this paper, COLCO received the January 11-17, 2001, edition of the WESTENDER.  An almost full-page advertisement (p.32) for Seasons at Raven Woods did not identify the developer, did not identify a warranty provider, did not identify band land, and did not inform the reader that ownership of land was not part of the purchase price.  Deep in the body of the “Advertising Feature” it was stated “Construction has now started ….”  And “Completion is expected in early 2002.”  Except for these two clues, the rest of the ad reads as if the project was complete and ready for occupancy.

In fact, the caption under the picture stated: “Seasons at Raven Woods is ideally located on the North Shore, ideally finished, and now ideally priced with a zero downpayment and 2.95 per cent interest promotion for a full three years.”  COLCO does not understand what “ideally finished” means.

The Seasons ad in the WESTENDER also stated: “That comes with the reassurance that you don’t need to fear a damp climate …. And the Canada Mortgage and Housing Corporation (CMHC) approved Rain Screen principles ensure moisture content during construction will meet prescribed limits.”

COLCO is still investigating what these statements might mean in reality. 

Chelsea Southlands
Telephone 604-266-2923

The advertisement for the Chelsea Southlands condo project also appeared in Condo Guide (November 17 – December 1, 2000, p. 29).

As stated above, the advertising in the issue was being examined as part of a larger ongoing investigation by COLCO.

The full-page advertisement for Chelsea Southlands carried the London Guarantee Warranty Logo.

Chelsea Southlands is located at Collingwood and 41st Avenue on the west side of Vancouver.

The Chelsea Southlands is a “new” condo project presently under construction.  It would  normally fall under the jurisdiction of the Homeowner Protection Office.  However, the City of Vancouver issued the building permit prior to July 1, 1999, without requiring a third party warranty.

Chelsea Southlands does not fall under the new homeowner protection legislation.  The provision of a warranty, if any, by the developer of Chelsea Southlands is therefore voluntary. (See “warranty confusion” above.)

The development of the property was approved by the City of Vancouver despite strong public opposition from the Dunbar Residents Association.  (See, for example, “Dunbar residents complain they have no clout with city”, by Alison Appelbe, Staff Writer, The Vancouver Courier, Sunday, September 10, 2000, in which Don Marquardt questions an apparent “collusion” among city council, planners and developers.)

Although reference to the developer’s reputation was mentioned in the advertisement, the name of the developer of Chelsea Southlands was not provided.

Macdonald Realty
Telephone 604-263-1911

Macdonald Realty is self-described as “British Columbia’s premier full-service real estate company, dedicated to providing excellence in real estate services through an environment that is committed to professionalism, productivity and integrity.”

The website states: “Since 1944, Macdonald Realtors has brought  high level of service and professional expertise to the business of real estate in British Columbia.

The company logo as advertised refers to “MacDonald Realty (1974) Ltd.”

COLCO has not determined the significance of the two different dates.

The website states: “Employing more than 500 real estate professionals, we are now the largest full service real estate consultancy group in British Columbia, with a pre-eminent reputation in the real estate marketplace, a position earned through more than half a century of unwavering commitment to excellence.” 

The advertisement for Chelsea Southlands carried a logo for Macdonald Realtors including “Macdonald Realty (1974) Ltd., Marketed by George Wong.”

MacDonald Realty personnel informed COLCO the developer of Chelsea Southlands was Larry Bourne of  No.158 Seabright Holdings Ltd. and referred COLCO to Keith Williams as the contact person for No. 158 Seabright.

Mr. Williams of No. 158 Seabright refused to provide information to COLCO when contacted by telephone.

COLCO determined that No. 158 Seabright Holdings Ltd. is not registered with the Homeowner Protection Office as a Licensed Registered Residential Builder.

A search of corporate records by COLCO revealed that Larry Bourne of 8832 Delvista Drive in Delta is the President/Secretary and Director of No. 158 Seabright.

Larry Bourne is not registered as a Licensed Registered Builder with the Homeowner Protection Office.

Financial Institutions Commission (FICOM)
Superintendent of Real Estate – Disclosure statement
Telephone 604-660-2947

“The Financial Institutions Commission (FICOM) is an agency of the provincial government, which administers 10 statutes providing regulatory rules for the protection of the public.   These regulatory rules are designed to [among others] safeguard consumers against improper market conduct in the financial services and real estate industries.”

A search of data provided by the Financial Institutions Commission of British Columbia, Office of the Superintendent of Real Estate, did not locate a disclosure statement filed for No. 158 Seabright.  A disclosure statement may have been filed using the name of a different company.  COLCO is continuing to search for a copy of the disclosure statement for Chelsea Southlands.

A disclosure statement must be filed in accordance with the Real Estate Act.  All purchasers are to be provided with a copy of the disclosure statement.  The disclosure statement should show the names of developers at the time of filing.  COLCO has determined that developers do not always file amendments to disclosure statements in a timely fashion. COLCO is seeking the help of FICOM in locating a disclosure statement for Chelsea Southlands. 

False reputation of developer

MacDonald Realty advertised the building and reputation of the developer as follows:

 “A traditional brick wall exterior with a cutting edge waterproof system will keep you dry and worry free.”

 “All compliments of an award winning developer with 30 years of building excellence, recognized by the industry for quality and innovation.”

COLCO’s investigation found that the incorporation date for No. 158 Seabright Holdings Ltd. was 20 August 1997, approximately three years ago, not 30 years ago.

COLCO contacted Mr. Bill Dick, Senior Sales Manager, for Macdonald Realty (Telephone 604-263-1911, email: bdick@macrealty.com.)  Mr. Dick explained by telephone and letter that he was not familiar with the details regarding warranties.  He pointed out that Macdonald Realtors does not deal with the issue “because it is the developer’s responsibility.”  “As the listing agent for the property, we reasonably rely upon the developer for warranty information and arrangements.”  It appears that this realty firm does not verify the information that it passes on to the marketplace.

Mr. Dick referred COLCO to Mr. Keith Williams of Glen Eagle Marketing (Telephone 604-538-7597) for further information.  Presumably unknown to Mr. Dick, COLCO had previously contacted Mr. Williams who refused to provide any information. 

Mr. Dick also informed COLCO that advertising for Chelsea Southlands in Condo Guide had been “discontinued for the time being.”

See a continuing exchange of correspondence with Macdonald Realty at www.myleakycondo.com.

CAPE Construction

COLCO had visited the construction site for Chelsea Southlands several months ago.  A sign indicated that CAPE Construction was the General Contractor for Chelsea Southlands.

CAPE Construction is registered as a Licensed Residential Builder with the HPO.
The licensee is James McGregor, License No. 20562, 633-5960 No. 6 Road, Richmond BC, Telephone 604-278-0912.  However, this license appears to have nothing to do with this project, Chelsea Southlands.

COLCO has determined that CAPE Construction has been involved in the construction of leaky rotten condos.  (See Leaky Rotten Condo List at www.myleakycondo.com)

Neil Ziola & Larry Bourne

COLCO was informed that Mr. Neil Ziola was the Project Manager for Chelsea Southlands.

COLCO investigators had previously determined that Larry Bourne of Prime Properties in partnership with Neil Ziola of Sure-Lok Homes developed and built several leaky rotten condo projects containing “Chelsea” in the name of the projects.  See COLCO’s Leaky Rotten Condo List available at www.myleakycondo.com and check forthcoming updates.

Sure-Lok Builders Ltd. is registered as a Licensed Residential Builder.  The licensee is Neil Ziola, License No. 21883.  Mr. Ziola operates Sure-Lok Homes out of a large house at 21308-78th Ave., Langley, BC, Telephone 604-513-1590.  There appears to be no connection between Mr. Ziola’s license and this project, Chelsea Southlands.

Neil Ziola has been heavily involved with the residential construction industry, including the following positions among others: CHBA-BC, Executive; NHW, Director and Chair, 1997-1998; and Chairman of the Georgie Awards Program, 1997. (See COLCO’s PourGee Awards Program, a satirical parody of the Georgie Awards, at www.myleakycondo.com.)

Evidence before the Barrett Commission revealed that Mr. Ziola and others were paid with money from New Home Warranty for “voluntary” work on behalf of the housing industry.  (Volume III, Documents)

NHW is insolvent, in part, because developers operating through different companies for each project, built too many leaky rotten condos.  Some of the CHBA-BC developers and builders who built leaky rotten condos, like Mr. Ziola, were intimately involved with the control and direction of the New Home Warranty Program.

Evidence before the Barrett Commission showed that the New Home Warranty Program was well on its way toward inevitable collapse during Mr. Ziola’s term of office with NHW and that nothing was done to prevent the collapse.

The Canadian Home Builder Association (CHBA-BC) presented the “Beaver Award” to Mr. Ziola “for outstanding contributions to CHBA-BC”.

The CHBA-BC presented the “Maple Leaf Award” to Mr. Brian Tweed of New Home Warranty of BC & Yukon.

Mr. Tweed is presently London Guarantee’s Business Development Manager for 3rd Party Home Warranty.  He had a similar position with New Home Warranty during Mr. Ziola’s term of office. 

The architect for Chelsea Southlands was and may still be Rosich Hemphill.  COLCO has determined that Rosich and Hemphill have been involved with the design of several leaky rotten condo projects.  Developers of leaky rotten condos have been known to change architects during the course of design and construction. 

Concluding remarks

Purchasing a home in British Columbia has destroyed the hopes, dreams and financial plans of thousands of Canadian citizens and new immigrants to Canada.

Confidence in the residential construction industry in British Columbia has been rightfully destroyed.  The market has crashed.  Housing starts are at 40-year lows.

The industry built and sold too many leaky condos, co-ops and houses.  The truth was hushed up far too long, often with tacit and explicit “confidentiality agreements”.  Once the truth became known, the housing market in British Columbia reacted accordingly.

Phony reputations pumped up by false advertising spread by realtors and marketers contributed to the misery experienced by thousands as their new leaky homes became mushy rotten dwellings infested with mushrooms and mould.

Members of COLCO have played a significant role in providing the public with information about their miserable experiences in the tricky condo market.  They don’t want other people to suffer. (See COLCO’s Leaky Rotten Condo List at www.myleakycondo.com) 

This unfinished continuing investigation clearly reveals that the new condo market remains a very tricky market.

COLCO has evidence that the re-sale market is also very tricky and expects to publish a paper on the marketing of re-sale condos before, during and after restoration from leaks and rot.

This investigation has revealed some of the information and questions that potential purchasers may want to consider when considering the purchase of a new condo or single- family home in British Columbia.  COLCO urges potential purchasers to proceed with caution.

Confidence in the residential construction industry will be restored (1) when purchasers of leaky rotten homes receive compensation and (2) when the architects and engineers, designers, developers, builders, inspectors and realtors deliver the promised goods: safe, warm and dry homes. 

Unfortunately, the condo market is somewhat mind-boggling and full of bafflegab.

Notice of thanks

The author extends a “thank you” to all those who have helped provide information and encouragement to the author and to COLCO for this and other investigations.  The author extends special thanks to COLCO investigator Mr. Rudy Eylmann for his diligent investigative fieldwork and his expertise in carpentry and construction.

The author takes full responsibility for this paper.  Please inform the author of any errors and omissions for correction in revised editions, as necessary.

A note about the author

Dr. James Balderson developed an intense, intellectual and passionate interest in the residential construction industry following the purchase of a brand new leaky rotten condo townhouse in 1991.  Born and raised in the west coast marine climate zone (Howe Sound), he took early retirement from a tenured position as Associate Professor of Educational Administration at the University of Alberta in order to follow his research and writing interests while enjoying living in a new condo on the west coast.  Unfortunately, the designer, developer, builder and City of Vancouver provided a condo (one of about 50,000 in the province) that was full of holes, leaks and condo rot.  Dr. Balderson attended all but two of the Barrett Commission public hearings.

Dr. Balderson firmly supports COLCO’s call for 100% compensation for owners of qualified leaky rotten condos, co-ops and houses.

Author contact information:
Dr. James Balderson
COLCO: www.myleakycondo.com
email: james.balderson@myleakycondo.com
Telephone 604-739-4190
Fax 604-739-4109

Notice of Copyright 2001
This document is protected by copyright.
Copies may be made for personal use and for non-commercial distribution.
Copies may be made for the purpose of restoring confidence in residential construction.
Copies may be made for members, relatives, and friends of COLCO.
Copies may be made for use by the news media, worldwide.
All other rights reserved.  Contact the author for further information and permissions.

Donations in support of COLCO may be mailed to:
COLCO - P.O. Box 16041, New Westminster B.C. Canada V3W 6W6 

Updated Jan 18, 2001
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