Performance audits identify common element deficiencies under warranty by the Ontario New Warranties Plan Act. Use our quick performance audit overview to help your condo board ace the process.

Performance audit 101

Tarion administers the warranty protection required for new homes and condos. A condo corporation’s common element warranties last up to seven years following the date the condo is registered. Under Section 44 of the Condominium Act, condo corporations must conduct the audits on the first, second, and seventh anniversaries of registration. The audit includes:

• Common elements inspection for deficiencies, including the foundation, parking garage, elevators, and mechanical, electrical, and fire protection systems
• A review of all reports required by Tarion
• An owners’ survey collecting evidence of observed common element damage or defects

The performance auditor

Your condo corporation hires and pays the performance auditor. Auditors must hold a certificate of authorization under the Professional Engineers Act or a certificate of practice under the Architects Act. You can use the Accredited Appraisers and Certified Engineering Technologists of Ontario websites to start your search.

When is the performance audit performed?

The first-year performance audit is scheduled six to ten months from the project registration date. There are also second-year and seventh-year performance audits due before the registration anniversary date that year. If an audit deadline is missed, Tarion will not warrant claims.

What is PATS?

The auditor submits their report to Tarion, along with a performance audit tracking summary (PATS). PATS lists all items identified in the performance audit the builder must resolve. Your board uses the PATS to streamline communication with the builder, track repair progress, and provide updates to Tarion every 90 days. The builder has an 18-month repair period based on the first anniversary of registration to resolve PATS items.

Tarion’s online tool, MyHome, helps manage the warranties, including uploading documents to help support warranty claims and making PATS updates. The system also sends auto reminders via email when warranty dates approach to keep timelines on track.

Appointing a performance audit designate

Once the performance audit is submitted, your board selects a “designate” as Tarion’s contact. Although board members can fill the role, an experienced property manager or performance auditor understands the resolution process. They can oversee repairs, record progress, and update the PATS.  Designate names are submitted to Tarion using the Appointment of Designate Form.

What happens if builders miss a deadline?

If the builder fails to address an issue from the first- or second-year performance audits, your delegate has 60 days to submit a Request for Conciliation form to Tarion. Tarion charges a fee to conduct a conciliation inspection and will send a final notice to the builders giving them an additional 90-days to resolve the issue. If the claim is still not complete, Tarion will choose one of the following steps:

• Provide another timeline when appropriate.
• Assess the costs and compensate your condo corporation for repair costs.
• Arrange third-party repairs if the issue presents health and safety risks.

Insufficient common element maintenance voids warranty coverage, making an effective maintenance plan a must.

Managing performance audits and PACS effectively guarantees warranty coverage for claims. A property management company can streamline the process to keep repairs and claims on track.

The condo experts at CPO Management Inc., a full-service property management company in Toronto and the GTA, have successfully assisted condo boards in finding experienced performance auditors, perform designate duties, and ensuring warranty claims are properly administered.  Reach out to us today.