Bill-59 has now been “Ordered for Third Reading”. This means the Bill will return to the Assembly for what we believe will be the final debate, and then await Royal Assent. For Government Bills the usual period of time between Third Reading and royal Assent is between 1 day and 6 weeks.
This does not mean however the Home Inspection Act, 2017 will come into force immediately. While the act has been broken up into parts and sections which could in theory be proclaimed individually, it is likely that the Act will be brought into force in its entirety in a single swoop. There are a number of items that are dependent upon proclamation however, and according to the wording of Bill-59, Schedule 1, which refers to the Home Inspection Act, 2017, a number of events are grouped to happen upon the same trigger.
The wording is buried at the end of the Schedule 1.
Commencement and Short Title
82 (1) Subject to subsections (2), (3) and (4), the Act set out in this Schedule comes into force on a day to be named by proclamation of the Lieutenant Governor.
(2) Section 77 and subsection 81 (1) come into force on the day that section 80 comes into force.
(3) Subsection 78 (1) comes into force on the later of the day subsection 211 (1) of the Not-for-Profit Corporations Act, 2010 comes into force and the day section 8 of this Act comes into force.
(4) Subsection 78 (2) comes into force on the later of the day subsection 211 (1) of the Not-for-Profit Corporations Act, 2010 comes into force and the day section 23 of this Act comes into force.
83 The short title of the Act set out in this Schedule is the Home Inspection Act, 2017.
What does this mean?
The Home Inspection Act, 2017 will come into force “on a day to be named by proclamation of the Lieutenant Governor”
According to the law, An Act may contain a provision which reads “This Act comes into force on a day to be named by proclamation of the Lieutenant Governor.”
Procedurally, under the Legislation Act, 2006, such a proclamation “shall be issued under an order of the Lieutenant Governor in Council recommending that the proclamation be issued.” “Lieutenant Governor in Council” is in turn defined as the Lieutenant Governor, acting by and with the advice of the Executive Council. In general, where a proclamation is made, it must be published in The Ontario Gazette.
In addition, the complete Act does not need to come into force at the same time. The Legislation Act, 2006 says that if an Act provides that it is to come into force on a day to be named by proclamation, proclamations may be issued at different times for different parts, portions or sections of the Act.
In theory, the Home Inspection Act, 2017, once having completed Royal Assent, could be introduced one piece at a time.
For the purposes of Section IX of this Act, this appears to be the timing of things that happen together:
- The Ontario Association of Home Inspectors Act, 1994, chapter Pr65, is repealed [Section 80]
- The Ontario Association of Home Inspectors will be dissolved in its current form and continued as a new not-for-profit corporation entitled “Ontario Association of Home Inspectors”. [Section 77(1)]
- The objects of the new “Ontario Association of Home Inspectors” will be: [Section 77(2)]
(a) to maintain high professional standards among the members of the Association through education and discipline;
(b) to provide formal training and educational facilities to the members of the Association;
(c) to hold conferences and meetings for the discussion of home inspection standards and practices and for the presentation of papers and lectures;
(d) to collect and disseminate papers, lectures and other information that is useful or interesting to the members of the Association;
(e) to publicize the role of home inspectors in Ontario, and, in particular, to publicize the full range of services offered to consumers in Ontario by home inspectors;
(f) to seek and maintain affiliations with, and to co-operate with, other organizations having objects, in whole or in part, the same as or similar to the objects of the Association
- Ontario Association of Home Inspectors Act, 1994 and Ontario Association of Home Inspectors is removed from Ontario Labour Mobility Act, 2009 and replaced by Home Inspection Act, 2017 and the defined regulator. [Section 81(1)]
At some other time in the future, when the Not for Profit Corporation Act, 2010 comes into force all references, in the Home Inspection Act, 2017, to the “the Corporations Act” will be replaced by “the Not-for-Profit Corporations Act, 2010” (Ontario legislation)
Is this going to happen overnight?
In politics anything can happen. That said, it is likely that once Bill 59 receives Royal Assent, the Ministry of Government and Consumer Services will get to work (if they haven’t already) on developing the regulations. These are likely to be based upon the recommendations made in the 2013 document “A Closer Look” regarding the qualifications of Home Inspectors in Ontario. These recommendations give suggestions not only for people coming into the profession, but also on how to handle people already performing inspections as Home Inspectors. The paper allows for a “transfer-in” period where existing Home Inspectors will be validated to ascertain if they would be eligible for a license under the new regulations, and what they would need to do if their skills or qualifications fell short. This process is likely to take around 12-18 months.
What is it going to cost the inspector?
In order for Licensing to be self-sustaining, a level of cost needs to be charged for the Home Inspection Licensing that funds any DAA activities. While in the short term, the public purse may be required to set the licensing mechanism up, the eventual aim of all regulation involving licensing is to end up financially neutral. The cost of each license will eventually depend upon how many Home Inspectors their are. The initial fees guessed at during the expert panel meetings was around $500-$750 per year, and this was based upon a Home Inspector population of approximately 1,450. This gave an annual budget of around $1m for infrastructure, staff and administration costs. It is possible that the back-end administration of the regulation could be performed using infrastructure already in place and being used by another Delegated Administrative Authority (DAA)
Currently there are a number of DAAs
- Bereavement Authority of Ontario(BAO)
- Electrical Safety Authority (ESA)
- Ontario One Call (ON1Call)
- Ontario Motor Vehicle Industry Council (OMVIC)
- The Ontario Film Authority (OFA)
- Real Estate Council of Ontario (RECO)
- Retirement Homes Regulatory Authority (RHRA)
- Tarion Warranty Corporation
- Technical Standards and Safety Authority (TSSA)
- Travel Industry Council of Ontario (TICO)
- Vintners Quality Alliance Ontario (VQA)
While we are certain many Home Inspector would like to work hand-in-hand with one of these DAAs (we feel that choice may lean toward the last one on the list) the needs of the Home Inspector regulation may be better provided by one not on the list. In December 2015, Bill 106 – Protecting Condominium Owners Act, 2015 received royal assent and required the creation of a DAA, the Condo Authority. While the needs of the Home Inspection regulations are poles apart from the needs of the Condominium Owners, the mechanical infrastructure to service the administrative boards of the two “new to be formed” DAAs could in theory be a shared service.
An alternative would be to develop the systems from scratch, or utilise an existing Associations infrastructure. Any move by the Ministry to do either of the latter would likely meet with fierce opposition from the profession either because of costs or because of the fear of bias.
It can bee seen from existing Associations, that the administrative costs for managing a number of individuals in the Home Inspection Profession ranges from $150 a year in OntarioACHI to over $500 a year for other Associations. The differences are created mainly by the choice of Information systems Infrastructure and the number of paid personnel and expenses incurred by the administrative teams. While a new DAA couldn’t do much about the core DAA board, which would necessarily have to be unique, sharing the back-end infrastructure with another already established DAA would make financial sense.
It is important that the government attempt to maintain a low cost for licensing as although the initial payment will be made by the Home Inspector, these costs will be passed on to the consumer in the way of fee increases. In an elective service industry, this could reduce the number of inspections performed, reduce the number of inspectors available and prove to be wholly counterproductive to the “Consumer Protection” aims of the regulations.
Making Home Inspections mandatory, as is the case in the Motor Industry, would relieve some of the downward spiral pressure on the profession, and allow the government to bolster the Consumer Protection side of the profession by requiring other services to be included naturally as part of the Inspection process, such as radiation from radon measurement and energy auditing, but government is not frequently known for thinking outside of the box.
Such a move may also require heavier regulation with regard to standard report formatting and content, standard contractual agreements and possible price regulation and this may be a series of steps the government is unwilling or unable to do.