The Claims-Free Architect

A Big Claim and a Human Rights Speech: The Co-op That Turned into a Real-Life Funhouse

• Pro-Demnity Insurance Company • Season 4 • Episode 12

Share episode

Send us a text

In a co-op where homes tilt like carnival funhouses, unstable soil wreaks havoc, can an architect be liable when a soils report fails to warn of impending danger?

Discover how site remediation can create problems, how appearances can be deceiving, how surveys can save you, and how shortcuts can cause projects to flounder. 

Connect with Pro-Demnity:

Thank you for listening.

A sound building requires a sound foundation, and a sound foundation requires a solid bearing. This is Architecture and Structural Engineering 101. It follows that when an otherwise sturdy building is constructed on unknown soil conditions, surprises—possibly expensive surprises—may be in store. 


In this Story, a housing complex had been constructed on a site with a questionable history, using an inadequate soils report. In barely a year, the project had become unstable, and uninhabitable—more like a fun house environment, without the fun, which is why this story is called “UN-FUN HOUSE.” 


Totterville is a small town, in southwestern Ontario. The town’s single industry, Trappo Textiles Inc., produces fabrics made from locally grown grasses, employing a large number of year-round, low-paid workers, many of whom are recent immigrants from Central America.


An increasing demand for their products prompted the Trappo owners to scale up production, which meant that additional workers would be needed, and that meant additional housing would also be required. Rudy Trappo contacted Gerrante Project Management, a development company in Windsor, to discuss the possibility of building workers’ accommodation near the plant, with rentals pegged to income. Gerrante had a better idea: a residential co-op project, operated by the residents, financed through the provincial government. If construction costs were kept low, it should work. 


To kick things off, Gerrante had the perfect site in mind. It was a good 20-minute walk from the plant, but it was an ideal size and could be bought fairly cheaply. It consisted of a triangle of land, bordered by two major roads and a railway track.


The site and the area around it had an interesting history. Over 10,000 years, since the last ice age, a stream had woven its way through the area, gradually eroding the soil to create a deep gully. Then, a half-century ago, when the provincial road system was being upgraded, the stream was encased in a pipe and the gully was gradually filled in with whatever fill was available, until finally, it was level with the surrounding countryside and roadways. This particular triangle of land was the last to be levelled, with the final few metres consisting of carefully graded engineered fill, under the supervision of Rampril Civil Engineering consultants. It was now available for sale at a reasonable price.


On behalf of Trappo, Gerrante approached Paula Horvack, the Windsor Architect who was overseeing the plant expansion, to put together a co-op housing scheme. Horvack came back with a proposal consisting of a series of townhouse clusters. The 65-unit project, entitled “Amicus”, would be built with provincial funding, and Horvack would provide complete architectural services. Foundation and structural design was based on the soils report supplied by Rampril Engineers. Gerrante and Trappo at first had concerns about the overall costs, but the project seemed doable.


As soon as the project was completed, new employees arrived to take up residence. It was a win-win situation for everyone. Trappo had an expanded workforce, the employees had small but comfortable accommodation, and the developer had managed to make a respectable profit. Everyone was happy . . . for about a year. . . until weird things started to happen.


First it was just bumps in the driveway and parking lot—like large bubbles under the asphalt. But slowly, the area started to assume the undulating appearance of a modest skatepark. At the same time, the buildings themselves started to shift. Cracks appeared in walls and ceilings, windows and doors became stuck in distorted frames, floors started to tilt. The closest comparison would be a carnival funhouse, except no one in these houses was having fun.


There was no way around it. Leading a normal domestic life under these circumstances was becoming impossible. The disastrous degradation of the site had left the Co-op Board with no recourse but to seek legal remedies.


The Amicus Co-op Housing Board’s Statement of Claim against the Developer, both the Civil and the Structural Engineering firms, the General Contractor and the Architect, alleged that the site had become uninhabitable. Roads and sidewalks, originally level, had become rolling terrain. Many homes had walls inclined at angles that made doors and windows inoperable, and floors sloped so much that area rugs would slide along the laminate flooring, taking furniture with them, and collecting along the walls. Photographs and expert reports accompanying the claim bore witness to the situation, which was really more like a house of horrors than a funhouse, and it could spell financial tragedy for the Co-op. Some of the co-op residents had to be relocated to temporary accommodations.


The Claim called for full restitution, with damages not yet fully determined, but in the range of $3.5 million.


The Architect Paula Horvack showed up at the Pro-Demnity offices with her personal counsel, the day after a bailiff had delivered the Statement of Claim. She was angry and nervous. Her anger was due to her belief that the case against her was “frivolous and without merit.” The Claims Specialist took pains to point out that the claim was possibly misdirected, but it was not frivolous. The circumstances were plain to see, and actual victims were clearly identifiable.


Her nervousness was due to the fact that, although she understood the gravity of the situation, she felt that she might be blamed for something that wasn’t her fault. We explained that nothing would happen before we had collected all the facts, and that could take many months. Horvack seemed appeased by this, but we could already see that our defence might be facing a rocky road.


Rampril Engineers, the firm that had done the site preparation and had supplied the initial soils report, took the view that it was all due to deficient construction. To begin with, their site preparation recommendations had not been followed to the letter. Their specifications had called for differing layers of compacted fill to be carefully placed and topped off with “engineered fill” of crushed stone. This had been either disregarded or poorly executed—between inspections, so that it went unnoticed. They also blamed inadequate perforated tile drainage systems, failure to handle surface water, and the absence of gas vents next to the roads. The gas vent suggestion was a surprise to us. No gas vents had ever been specified, but according to Rampril, they could still be installed at no great expense.


By way of explanation, according to Rampril, it sometimes happens that fill material, casually deposited over the decades, on top of unexamined terrain, can contain organic waste that will generate gases that percolate up to the surface. When the ground has been sealed with buildings and paving, the gas builds up pressure which may cause dramatic heaving. Rampril was confident that the last few metres of fill that they had carefully installed should have prevented the “bubbling” effect. It was free from defect, and they had a soils report to prove it. But their failure to examine what lay underneath their engineered fill—or to share their suspicions and lack of information about it—was unaccountable.


The Structural Engineers Alfabeta, in their statement, claimed that they had done everything by the book. Their design conformed to Code, and they had no liability for—or any background knowledge of—the site conditions. They had relied entirely on information provided by Rampril. In fact, Alfabeta’s foundation drawings included an exculpatory clause to this effect. But having said this, in their considered opinion, the buildings weren’t all that bad. They presented no grave danger, and the structure wasn’t beyond repair. It just needed to be straightened up a little.


The Municipality stated that they were not Engineers, so they had relied on the licensed professionals. Their building inspector had observed no Code violations during construction and the Rampril Soils Report had given them sufficient comfort. This was a standard defense for municipalities, whose inspections are normally understood to cover Code and life-safety issues, not engineering matters. But their legal counsel did admit that, before reading Rampril’s report, they had entertained their own concerns about deeper subsoil conditions. This being a farming area, it was inevitable that some of the backfill would contain organic material that would decompose over time. 


The Architect’s defence was also pro-forma, at least initially. We took the view that we had no liability for the site conditions, which appeared to have been misrepresented to us. The buildings and paved areas had been properly constructed, based on the information provided, so no one should be looking to us for remediation contributions.


Pre-Trial Discoveries produced nothing new. All of the co-defendants held themselves to be totally blameless for the unfortunate plight of the residents, whose misery was only compounded by the cost of the legal action. Although the residents’ claim, like the original construction, was being funded by the Province, their agreement stated that any costs incurred by the legal action would be added on top of their mortgage.


Despite this, the Province was in no rush to pay the plaintiff’s counsel, so things dragged on, until at last, mediation was mandated. The parties agreed to a private mediation and, after discussing several candidates, engaged Una Lipito as mediator—a senior lawyer with a reputation for successfully settling complex issues.


The mediation took place in the boardroom of a large law firm, at an enormous boardroom table, around which more than two dozen people were gathered: plaintiffs, defendants, lawyers, experts and insurers. Representatives of the provincial government and the Municipality were also in attendance, sitting in rows, behind their counsel.


The plaintiffs’ delegation consisted of a handful of unsmiling, extremely disgruntled residents who had elected to sit, in a group, at the foot of the table, directly facing the mediator’s currently empty chair. It was clear from their demeanour that before the mediator could negotiate anything, she would first have to avert a pitched battle.


Casual chatter stopped immediately when Una Lipito entered the room, took her chair, and delivered her preamble regarding confidentiality, respect, communication, honesty, flexibility, brevity etc.,. She then asked each participant to introduce themself. This process took a good half-hour, and may have seemed unnecessary, however, it served to maintain a calm and restrained atmosphere, and this gave us some hope of a positive result.


As it turned out, this tactic also served two other important functions. It gave each participant a chance to be heard and to feel valued, and it allowed the mediator to take the measure of each participant and to consider how best to interact with them.


She then asked defence and plaintiff to state their cases briefly.


Plaintiff’s counsel referred us to his brief, adding that the project was a shambles and a horror — an unlivable hell that called for immediate remedies. He did not care who paid, but his clients needed $3.5 million to reconstruct the property and pay off expenses to date. His case and the facts he presented were clear.


The Defendants each delivered their own brief version of their lack of culpability for the condition of the buildings and the site. None disagreed that a loss had been suffered, but it was others who had failed, not them. The defence positions were eerily identical: Their actions were “up to the standards of the profession”; periodic reviews could not protect the owner against errors that were not observable; everything met Code standards, etc., etc. No one made any offer to settle.


Each party had obviously decided that the best defence was an offense against the other defendants. Yes, the plaintiffs should be compensated—but not by them. This self-serving strategy actually strengthened the plaintiffs’ case, since no defendant denied that a loss had occurred.


When the lawyers from both sides had presented their cases, Ms Lipito suggested that, before we caucused, she would like to hear directly from one of the residents.


One member of the Co-op Board, Ernesto Milagro, had been chosen to address the group. With all eyes fixed on his slight figure, he slowly rose and returned their gaze, looking at each individual sitting around the table. Then, he began to speak, quietly but firmly. All ears strained to hear his soft, heavily accented voice.


He started by explaining that he, and most of the tenants, were new to Canada. He was unfamiliar with Canadian legal processes, but he knew injustice when he saw it. 


He followed with a series of rhetorical questions. 


Did any of us know what it was like to be an immigrant, poor and working for low wages, in a land of plenty? Did we know how important it is to have a simple, basic home to raise children who might stand a chance at improving their lives? Did any of us feel any shame by dodging the issues and shifting the blame, showing no concern for those who were actually suffering—and making things worse by insulting their dignity and adding to their poverty with this unnecessary legal process?


Mr. Milagro finished his short, powerful speech by saying that he wasn’t surprised by the attitudes of the defendants, but he and the others had earnestly hoped that in Canada, they would not encounter the kind of class discrimination that they had emigrated to avoid.


The room remained quiet after he had finished speaking. It was clear that the words had a sobering effect, and the mediator had gotten the result for which, we believe, she had hoped.


In subsequent caucusing, the argument didn’t revolve around innocence or guilt—only on how much or how little each defendant would contribute. All together we managed to raise two million dollars. The Soils Engineers’ insurer put in the most, a million dollars; followed by the Structural Engineers who contributed a half-million dollars, and the Architect and Municipality who each contributed a quarter-million. Gerrante, the developer, had no insurance and was no longer in business.


The plaintiffs accepted our offer, and the matter settled.


Once again, an Architect had faced the old problem of building a sound structure without really knowing what it was being built on. Knowledge of this site’s dodgy history was available to all, but none of the defendants had thought to dig deeper—literally or figuratively—to find out what conditions lay between the buried stream and the top few metres of engineered fill, and to take the necessary precautions. This turned out to be a costly oversight.


We’re not certain what became of the settlement money. Once legal costs had been dealt with, it’s doubtful that anything better than a patch-up job on the existing housing would have been affordable. The Co-op residents got an expensive lesson in the legal system and the way that poor factory workers may expect to be treated. We trust that the Architect also learned a thing or two.


Lesson No. 1: Don’t accept at face value the soils report that comes with the site. As the captain of RMS Titanic was tragically reminded, you can’t know the nature of something (an iceberg or a landfill) by observing the top 10%. If the Client in this case had commissioned a new, independent soil survey, the composition and the lack of compaction at lower levels might have been obvious. If the history of the site is known to be dubious, dig as deeply as needed to find out what you’re building on, and be prepared to walk away.


Lesson No. 2: It also came to light that in order to keep the construction costs down, not only had cheap land been acquired, and the cost of a soils report avoided, but inexpensive materials had been used all-around in the construction, which became that much more obvious once the buildings began to deteriorate. Taking shortcuts to save time and effort is always a short-sighted strategy that is bound to cause significant maintenance and replacement costs, even without soil problems.


In the face of our country’s severe housing crisis, all attempts to construct new homes are to be encouraged, but it’s a false economy and a dangerous strategy to do so by cutting corners. A particular stress is exerted on the housing market by Canada’s essential immigrant population. According to statistics, more than 50% of recent immigrants to this country whose labour is vital to the economy, live in scarce and costly rental housing - the affordability of which, continues to be a crisis.