Ontario Superior Court of Justice. Small Claims Court Goderich, Ontario. Between: Robert Winter Sr., Robert Winter Jr. and Heritage Estates Inc.

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1 Ontario Superior Court of Justice Small Claims Court Goderich, Ontario Court File No. 51/09 and 53/09 Between: Robert Winter Sr., Robert Winter Jr. and Heritage Estates Inc. - and - Earl Gaines and Ruby Knight-Gaines and Grace Groenveld Judgment: May 2, 2011 Plaintiffs Defendants Representation: Emma Sims, Paralegal for the Plaintiffs Philip B. Cornish, Lawyer for the Defendants Overview: Reasons for Judgment The Plaintiffs have owned and operated a mobile home park known as Heritage Estates near Seaforth, Ontario in Huron County since The park contains 38 serviced sites. Heritage Estates has its own water system, complete with well, pump, pump house and pipes. The tenants own their own mobile homes. The Plaintiffs own the land on which the individual mobile homes sit, as well as all of the other land and streets within the mobile home park. The Defendants Earl Gaines and Ruby Knight-Gaines (hereafter referred to as the Defendant Gaines), tenants in the park since 1996, do not have a written lease. They reside at # 3 Main St. The Defendant Grace Groenveld (hereafter referred to as the Defendant Groenveld), a tenant in the park since July 2003, also does not have a written lease. She resides at # 20 Main St. This case involves the landlord s charges to the tenants for water testing, as well as several allegations by the tenants against the landlord. The case is not just about the dollars involved. These parties and others are watching to see what guidelines are established for the issues in dispute. That is the only way the length of this trial can be justified.

2 2 Procedural Matters: What started as 2 separate court files on consent became consolidated into one for trial purposes. For that I commend the parties and their representatives. Even though the trial still took 8 days to hear all of the evidence, the consolidation saved a lot of time and duplication. Part way through the second day of trial, it became evident that the Plaintiff was named incorrectly. As a result, on consent, the Plaintiffs became Robert Winter Sr. (who was the original Plaintiff and who shall be referred to in my Reasons as Mr. Winter ), his son Robert Winter Jr. and their company Heritage Estates Inc. Those same 3 entities also became the Defendants in both Defendants Claims, although I will continue to refer to them as the Plaintiffs, regardless of whether I am referring to the main Claim or a Defendant s Claim. The Plaintiffs original Claim against all of the Defendants included charges for water testing in the first 3 months of That amount was $ , being $ per month. At the beginning of the first day of trial, on consent the parties agreed that that amount should be reduced to $ , being $ per month. At the beginning of the second day of trial, the Plaintiffs Claim was further amended on consent to include water testing for all 12 months of 2009, instead of just the first 3 months. (I don t know why this amendment was not made at the very beginning of the trial.) The Plaintiffs original Claim against the Defendant Groenveld for water testing was $ in It turns out that Ms. Groenveld paid some money to the Plaintiff for which she had not been given credit. Therefore, on consent, the parties agree that that portion of the Plaintiffs Claim should be reduced to $ to reflect the amount already paid. In its Defence to both of the Defendants Claims, the Plaintiff disputed the jurisdiction of the Small Claims Court to deal with the Defendants Claims. The Plaintiffs position was that the issues raised in the Defendants Claims are within the exclusive jurisdiction of the Landlord and Tenant Board. After hearing argument on this point at the beginning of the trial, for oral reasons given, and relying upon Crooks v. Levine [2001] O.J. No and O Brien v Ontario Inc. [1999] O.J. No. 1270, I ruled that the Small Claims Court does have jurisdiction to deal with the issues raised in the Defendants Claims. The trial proceeded accordingly. At the commencement of the trial, the Defendant Grace Groenveld brought an oral motion to amend her claim from $ 6, to $ 10, As I heard the motion and the objections of the Plaintiff, the following became evident: 1. The Plaintiff s representative was only officially notified the day before the trial commenced that the said Defendant was asking to amend the amount of her claim. 2. However, the lawyer for the said Defendant sent receipts to the representative for the Plaintiff approximately 2 weeks before the trial commenced. 3. The Defendant s lawyer did not specifically point out to the representative for the Plaintiff what the new total amount was.

3 3 4. However, the said receipts supported the increased amount. 5. The cause of action was not changed simply the amount being requested for damages. 6. Rule of the Small Claims Court Rules allows a claim to be amended as of right if it is done at least 30 days before the commencement of trial. Considering all of the above, and specifically the fact that the receipts supporting the increased amount had been in the possession of the Plaintiff s representative for approximately one-half of the time by which the Defendant could have amended automatically, I allowed the Defendant Groenveld to increase the amount of damages being claimed to $ 10, Pumping of Septic Tank: The Defendant Gaines made a Claim against the Plaintiffs for not pumping her septic tank frequently enough. However, she abandoned her Claim during the trial. Improper Charging of GST: Both Defendants made a Claim against the Plaintiffs for improperly charging GST on certain expenses. However, both Defendants abandoned those Claims during the trial. Claim and Defendant s Claim: After all of the above adjustments are made, the Plaintiffs claims against the Defendants for the testing of water are as follows: a) As against Gaines for 2007, 2008 and 2009 $ 1, made up as follows: $ $ $ b) As against Groenveld for 2007, 2008 and 2009 $ 1, made up as follows: $ $ $ The Defendant Gaines is making a Claim against the Plaintiffs for $ 8, as follows: a) Failure to provide safe drinking water; b) Forcing the said Defendant to purchase a water filtration system; c) Improperly charging for maintenance and operating costs; d) Failure to keep the premises in a good state of repair; e) Improperly charging for land taxes in 2007, 2008 and 2009; and f) Flagrantly violating statutory provisions and orders of the Landlord and Tenant Board by improper billings to tenants.

4 4 The Defendant Groenveld is making a Claim against the Plaintiffs for $ 10, as follows: Issues in Dispute: a) Failure to provide safe drinking water; b) Failure to keep the premises in a good state of repair; c) Allowing ground water to accumulate and damage the said Defendant s mobile home; d) Improperly charging for maintenance and operating costs; e) Improperly charging for land taxes in 2007, 2008 and 2009; and f) Flagrantly violating statutory provisions and orders of the Landlord and Tenant Board by improper billings to tenants. Combining all of the Claims, the issues to be decided are as follows: 1. Whether the Plaintiffs can charge the Defendants for all of the out-of-pocket expenses which the Plaintiffs incurred with regard to the testing of water. 2. Should the Defendants be entitled to an abatement of rent because of the disruption in water service from time to time? 3. Should the Defendant Gaines be entitled to an abatement of rent because they bought a water purification system? 4. Alternatively, should the Defendants Gaines be entitled to be reimbursed for what they paid for the water purification system which they purchased? 5. Are the Plaintiffs liable to the Defendant Groenveld for the damage to her mobile home? If so, what are her damages? 6. Have the Defendants been overcharged by the Plaintiffs for municipal taxes? Landlord s Obligations: Pursuant to Section 161 of the Residential Tenancies Act, 2006, S.O. 2006, c. 17, the landlord of a mobile home park is responsible as follows: In addition to a landlord s obligations under section 20, a landlord is responsible for, (d) maintaining the water supply, drainage and electrical systems in the mobile home park in a good state of repair; (e) maintaining the mobile home park grounds in a good state of repair; and (f) repairing damage to a tenant s property, if the damage is caused by the wilful or negligent conduct of the landlord.

5 5 Section 20(1) of the Residential Tenancies Act states: A landlord is responsible for providing and maintaining a residential complex in a good state of repair and fit for habitation and for complying with health, safety, housing and maintenance standards. As a result of the terrible tragedy that struck Walkerton, Ontario in 2000, the provincial government passed the Safe Drinking Water Act, 2002, S.O. 2002, c. 32 (herein referred to as the Safe Drinking Water Act). The relevant portions of Section 11(1) of the Safe Drinking Water Act state: Every owner of a regulated non-municipal drinking-water system [which is what exists in Heritage Estates] shall ensure the following: 2. That, at all times, the drinking-water system, i. is operated in accordance with the requirements under this Act, ii. is maintained in a fit state of repair, 3. That the drinking-water system is operated by persons having the [required] training or expertise. 4. That all sampling, testing and monitoring requirements under this Act that relate to the drinking-water system are complied with. 6. That the persons who carry out functions in relation to the drinking-water system comply with such reporting requirements as may be prescribed. Charges for Water Testing: The relevant portion of Section 166 of the Residential Tenancies Act states: The landlord shall not charge for any of the following matters, except to the extent of the landlord s reasonable out-of-pocket expenses incurred with regard to those matters: 5. The testing of water in a mobile home park. Everyone agrees that the Plaintiff can charge the Defendants for reasonable out-of-pocket expenses incurred with regard to the testing of water in Heritage Estates even in the absence of a contractual agreement between the Plaintiff and the Defendants to this effect. That issue was decided in the Ontario Divisional Court decision of Campbell et al v. Maytown Inc. et al, [2005] O.J. No The issue in this case is whether the charges that the Plaintiffs levied against the Defendants are reasonable out-of-pocket expenses incurred with regard to the testing of water. Everyone agrees that the Small Claims Court has jurisdiction to decide this issue.

6 6 Claim for Mr. Ritchie s time: Initially, Mr. Winter was able to do some of the testing of the drinking water himself. But eventually, in order to comply with the Regulations under the Safe Drinking Water Act, he hired one of the tenants in Heritage Estates, Bill Ritchie, to do the daily required testing. The Plaintiff also hired Veolia Water Canada Inc. (hereafter referred to as Veolia ) to do the additional testing that was mandated by the Regulations. Before the Plaintiffs hired Veolia, it obtained quotes from others qualified to conduct the additional testing (which Bill Ritchie was not qualified to do). Veolia was the lowest quote. Before Veolia was hired, the Plaintiffs used SGS Environmental Services (hereafter referred to as SGS ) for some of the water testing. The Defendants dispute the charges attributed to Mr. Ritchie s testing as well as some of the charges from Veolia and others. Mr. Ritchie had the necessary qualifications to do the daily testing. In return for his services, Mr. Ritchie did not have to pay anything for rent, property taxes or water. The Plaintiff billed the tenants in Heritage Estates for the equivalent of what would have been paid to Mr. Ritchie. I find that the evidence indicates that Mr. Ritchie spent approximately 3.3 to 4 hours each week testing the water and sending the results to Veolia. Mr. Ritchie s services were billed as follows: a) for $ 2, the equivalent of $ per week or $ $ per hour b) for $ 1, the equivalent of $ per week or $ 9.23 $ per hour c) for $ 2, the equivalent of $ per week or $ $ per hr. Based on the invoices from Veolia, I find that the hourly rates charged by Veolia ranged from $ in 2007 to $ in In addition, Veolia charged mileage from Goderich to Seaforth, Ontario for any trips that a Veolia employee made to Heritage Estates. The Veolia invoices show that each round trip was 71.2 kilometres. Using the mileage rates which Veolia charged on their invoices, I find that each round trip incurred a mileage charge of approximately $ to $ The Defendants complaints about Mr. Ritchie are as follows: 1. There was no written agreement between any of the Plaintiffs and Mr. Ritchie to do the water testing.

7 7 2. The tenants were never given any details of what the financial arrangements were between the Plaintiffs and Mr. Ritchie. 3. The Plaintiffs gave the job to Mr. Ritchie without any tendering or consideration of others who were qualified to do the job. 4. The Plaintiffs did not do any market assessment of what was reasonable to pay someone like Mr. Ritchie for doing the daily testing. Based on the evidence, I find that none of the Defendants complaints about Mr. Ritchie have any merit. When one looks at: 1. The amount of time that Mr. Ritchie spent each day performing his duties; 2. The fact that his payment worked out to between $ 9.23 to $ per hour; 3. The fact that Mr. Ritchie was available to do the job 365 days of the year; 4. The qualifications that were required to do the job; 5. The responsibility that Mr. Ritchie had; and 6. What Veolia would have charged both in its hourly rate and in its mileage charge, I find that what Mr. Ritchie was receiving for his services was a reasonable amount. Invoices from Veolia, SGS, Metcon and Southwest Water Systems: That leaves us with the charges levied to Heritage Estates by Veolia as well as some other miscellaneous invoices. I find that all of the invoices from the laboratory for water testing done in 2007, 2008 and 2009 are reasonable and are a proper expense to be passed on to the tenants. From time to time, Veolia sent invoices to Heritage Estates for the work it did. The Defendants are not questioning the validity of the invoices or the competence and standard of work conducted by Veolia. What is in issue is which of the charges that appear on the Veolia invoices should be passed on to the tenants in Heritage Estates. As I have already stated, a landlord of a mobile home park is entitled to pass on to its tenants reasonable out-of-pocket expenses incurred with regard to the testing of water. Mr. Winter testified that he knows the Plaintiffs cannot charge the tenants for general operating and maintenance expenses. During the trial, the Plaintiffs conceded that some of the charges were not proper water testing charges to be reimbursed by the tenants. In her written Submissions, Ms. Sims said:

8 8 Mr. Winter acknowledged that some of the charges ought to be removed and consented to the removal of the same during the course of the Trial. But then Ms. Sims did not give me any details of what charges should be removed. Mr. Cornish, on the other hand, spent 2 pages of his written Submissions listing items that should be excluded. He then gave a total figure of $ 9, as the amount to be deducted from the overall water testing charges. Considering all of the evidence that was heard during the and the fact that Mr. Winter was in the witness box for the better part of the first 3 days of it, Mr. Cornish s approach is the preferable one. Regardless of whether I agree with all of the items that Mr. Cornish listed, at least he provided me with a starting point. The Plaintiffs position is that everything that was charged to the tenants represented reasonable water-testing charges, with the exception of any charges that Mr. Winter conceded during the trial were not proper. In her written submissions, Ms. Sims referred me to the case of Winter v. Dockrell and Miller, [2008] O.J. No This is a decision of Deputy Judge Celia MacDonald involving the same plaintiff as we have here. Deputy Judge MacDonald made the following statement in her Reasons for Judgment: The Plaintiff s evidence and witnesses were thorough and convincing about the necessity for the water testing that was done and the reasonableness of the costs. The Defendants did not challenge the Plaintiff s evidence in any meaningful way. Unfortunately the Reasons do not give any details of the costs. Therefore, I do not find the case helpful to me. In order to determine of the issue of what are reasonable out-of-pocket expenses incurred with regard to the testing of water, we must ask the following questions: 1) Has the landlord incurred an out-of-pocket expense? If not, then the expense is not allowed to be passed on to the tenants of a mobile home park. In other words, a mobile park landlord cannot charge the tenants a fee for water testing. 2) Is the out-of-pocket expense for the testing of water? If not, the expense is not allowed to be passed on to the tenants of a mobile home park. 3) If the expense is for the testing of water, is it reasonable? If not, again it cannot be passed on the tenants. It is only reasonable water-testing expenses that can be passed on to the tenants. I find that all of the expenses which the Plaintiff has charged the tenants under the heading of water testing pass the first test. In other words, they are all out-of-pocket expenses, including the charges for Mr. Ritchie s services. That leaves me to determine if the expenses are for water testing and, if they are, are they reasonable.

9 9 Drinking-water test is defined in section 2 of the Safe Drinking Water Act as a test for the purposes of this Act to assist in the determination of the quality of any waters in respect of a drinking-water system. Section 2 of the Safe Drinking Water Act further defines test as follows: test includes analyse when used as a verb, and test, when used as a noun, and testing have corresponding meanings. Section 167(3) of the Safe Drinking Water Act allows regulations to be made: 3. prescribing requirements relating to monitoring, testing, record-keeping and submission of reports. 4. prescribing reporting requirements by owners of drinking water systems, including requirements for reporting to the public. Section 167(4) of the Safe Drinking Water Act allows regulations to be made: 1. prescribing drinking water tests for the purpose of the definition of drinking water test in section 2; 7. prescribing requirements in relation to drinking water testing for record-keeping; 9. governing record-keeping, the reporting of drinking water tests, and the persons to be notified of those results. The relevant portion of Ontario Regulation 170/03, made pursuant to the Safe Drinking Water Act, states: 11. (1) The owner of a drinking water system shall ensure that an annual report is prepared in accordance with this section. We were fortunate to have two expert witnesses testify, both of whom were qualified as expert witnesses in the areas of water testing, water treatment and water distribution. The first expert witness was Mr. Lawrence Laurie Cox. He is a water operator with Veolia, based in Goderich, Ontario. He has been a water operator for 22 years. Prior to Veolia taking over management of the water supply for the Town of Goderich, Mr. Cox was the Water Superintendent with the Goderich Public Utilities Commission. He was called as a witness by the Plaintiffs. The second expert witness was Mr. Luke Sturdy. Mr. Sturdy is also employed by Veolia as a water operator. In fact, he has been the operator in charge of the water system at Heritage Estates since He was called as a witness by the Defendants.

10 10 Mr. Sturdy testified that he defines water testing as the physical taking of the water sample and sending it to the laboratory for testing. Shipping Charges: Mr. Cornish submits that the shipping charges on the invoices are not a reasonable water-testing expense and therefore they should be disallowed. The evidence indicated that the water samples had to be shipped to an approved laboratory for testing. As a result, I find that the shipping charges of $ each are a reasonable water-testing expense to be charged to the tenants. Mileage Charges: Someone from Veolia was required to attend at Heritage Estates from time to time for the regular water testing work. But there were also times when a Veolia employee was required to attend for extra work. Mr. Cornish submits that I should only allow mileage for the regular work and disallow the mileage for the extra work. My difficulty is that I do not know what extra mileage expenses were charged for 2007 and the first 4 months of I am not going to speculate. Hence, I will allow all of the mileage charges for 2007 and the first 4 months of 2008 as a reasonable water-testing expense. By May 2008, Veolia was usually showing the extra mileage charges under the item which caused the extra mileage. As I examine each invoice from May 2008 to December 2009 inclusive, it will become evident which mileage charges I allow and which I disallow. Chlorine Charges: Most of the invoices contained a charge for chlorine which the Plaintiffs passed on to the tenants. Ms. Sims referred me to Forrest Estates Home Sales Inc. v. Mellor, an unreported 2006 decision of Deputy Judge Larry Smith. The case decided in Goderich, Ontario also involved charging for chlorine in a trailer park. Deputy Judge Smith made the following comments in his Reasons for Judgment: The plaintiff hired the services of Veolia. Mr. Cox, a representative of Veolia, stated that the plaintiffs water system was tested each day. As part of the test the level of chlorine was monitored each day and if necessary chlorine was added. The cost of the inspection was passed on to the residents. The Plaintiff continued to pay for the operation and maintenance of the water system. Regulations #170 of the Safe Drinking Water Act, required that the water system have a chlorine residual at all times. Consequently, the Veolia inspector had to check the chlorine residual each day and add sodium hypochloride (being the source of chlorine). Veolia charged the plaintiff for the inspection on an hourly basis plus disbursements. One of the disbursements was the cost of the chlorine.

11 11 The defendants contend that the plaintiff can only pass on to the residents the cost of the testing but is not entitled to be reimbursed for the chlorine because it is not necessary to conduct the test. I accept the plaintiffs position that since the adding of chlorine to the water is mandatory and each test made daily is partly to determine the chlorine residual, then the cost of the chlorine is an aspect of the testing regimen. The adding of the chlorine is to keep the proper balance, which is part of the test. It is a reasonable expense. Because the case was decided in Goderich, I assume that the Mr. Cox referred to in Forrest Estates Home Sales Inc. is the same Mr. Cox who testified in this case. I found Mr. Cox to be an honest and forthright witness. Mr. Cox specifically said in his evidence in the case with which I am dealing that chlorine is used in the treatment of water, but is not part of the testing. In fact, he said that several times. Mr. Sturdy also said that he would not consider chlorine as part of water testing. Instead he would classify it as part of operations. Considering the evidence of the experts in this case, and notwithstanding Forrest Estates Home Sales Inc., I find that the charges for chlorine cannot be passed on to the tenants pursuant to section 166 of the Residential Tenancies Act. Therefore, wherever there is a charge for chlorine on the invoices which follow, I will disallow it and deduct the charge from the total without further comment. Balance of Charges: Now I am will comment on each invoice in chronological order. To quote Mr. Cornish in his written Submissions, the process is pain-staking, but necessary to determine if there was any over-charging of the tenants by the Plaintiffs. It will be easier to look at the month for which the work was attributed, instead of the date of the invoice. SGS Invoice dated December 27, 2006: While I realize that this invoice was paid in January 2007, it relates to water testing done in The Plaintiffs Claim against the Defendants is for water testing in 2007, 2008 and Therefore, I disallow the Plaintiffs being able to recover any of that invoice from these Defendants. Amount of invoice $ Amount I allow to be charged to the tenants $ 0.00 SGS Invoice dated January 25, 2007: This invoice was not challenged by the Defendants. Therefore, I allow the full amount as being proper and reasonable water testing charges. Amount of invoice $ Amount I allow to be charged to the tenants $

12 12 SGS Invoice dated March 29, 2007: This invoice was not challenged by the Defendants. Therefore, I allow the full amount as being proper and reasonable water testing charges. Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for March 2007: The contentious issues regarding this invoice have to do with: i. the testing for nitrates and THMs; and ii. the Annual Summary which Veolia is required to prepare pursuant to the Safe Drinking Water Act and its Regulations. There were also extra water tests done because of an ice storm. I find that an ice storm is beyond the control of the landlord. Hence, any additional testing done because of an ice storm is reasonable. Mr. Cox said that the testing for nitrates and THMs trihalomethanes in drinking water has to be done quarterly. I find that the testing for nitrates and THMs fall within the definition of water testing and the charges are reasonable. Everyone agrees that the Annual Summary is required by the legislation. It is also agreed that Veolia prepared these Annual Summaries for the Plaintiffs. Mr. Cox referred to the preparation of the Annual Summaries as an administrative function. Does the preparation of the Annual Summary fall within water testing? Mr. Cox testified that the Annual Summary is simply a summary of tests taken over the year. There are not any extra tests done for the Summary. Mr. Sturdy said that the preparation of the Annual Reports is not part of water testing. I have considered the definitions of drinking-water test and test in the Safe Drinking Water Act. I have also considered the fact that section 167(4) the Act separates drinking water testing from reporting of drinking water tests. Section 166(5) of the Residential Tenancies Act says the testing of water. If the legislature had wanted to include the cost of preparing annual reports, it could have said so specifically. Considering all of the above, I find that the preparation of the Annual Summaries which are required under the legislation is not part of the testing of water. As such, the expense for preparing those Annual Summaries is not one of the ones covered by section 166(5) of the Residential Tenancies Act. Accordingly, the amount that can be charged to the tenants on this invoice is reduced by $ plus 6 % GST of $ 17.20, making a total reduction of $ Amount of invoice $ 1,113.58

13 13 Amount I allow to be charged to the tenants $ $ Veolia Invoice for April 2007: The only contentious issue is the charge for chlorine. Accordingly, I deduct $ plus $ 1.41 GST, making a total of $ from this invoice. Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for May 2007: The contentious issues regarding this invoice have to do with: i. the extra samples that were taken because of a Boil Water Notice; and ii. the Filter Failure entry. A great deal of trial time was taken hearing about the numerous Boil Water Notices that were issued in Heritage Estates. I heard evidence about them from Mr. Robert Worsell, the Public Health Manager, Safe Water Program, for the Huron County Health Unit (hereafter referred to as the Health Unit ), Mr. Cox and Mr. Sturdy, as well as several lay witnesses. Mr. Worsell is familiar with Heritage Estates, having been to the mobile home park. These Boil Water Notices were issued by the Plaintiffs in a variety of situations. It could be when there was a loss of water pressure or when the filters failed. The Boil Water Notices follow a template provided by the Health Unit. They cannot be lifted until there is a satisfactory test of the done. In May 2007, according to Mr. Cox s evidence (which is supported by a charge on the Invoice), there was a filter failure. Because the filters failed, extra sampling and testing had to be done of the water. Mr. Sturdy said that cartridge filters will plug up in normal usage. But I find that the replacement of filters is a maintenance item and should be done on a regular basis. Is it reasonable to ask the tenants to pay for the extra testing that is required when the filters fail? I find it is not reasonable. In his written submissions, Mr. Cornish asks me to deduct the cost of 9 samples. But I do not know where that number comes from. Mr. Winter s evidence is that at least 2 samples were extra because of the Boil Water Notice. Since I don t have any other number, I will deduct from this invoice the cost of 2 samples, being $ plus $ 1.15 for GST, making a total of $ Mr. Sturdy said that filters are not part of water testing. As I have already said, filter replacement is a maintenance item. Mr. Winter said that the filter failure was not water testing, but instead it was an operational expense. Therefore, I find that charges having to do with filter failure are not a water testing item. Accordingly, I deduct $ plus $ 8.91 for GST, for a total of $

14 14 Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for June 2007: The only contentious issues are the chlorine and the nitrates. For reasons given above, I allow the charge for nitrates, but disallow the charge for chlorine. Accordingly, I deduct $ plus $ 1.49 GST, making a total of $ Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for July 2007: The only contentious issue is the chlorine for which I deduct $ including GST. Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for August 2007: The only contentious issue is the chlorine for which I deduct $ Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for September 2007: The contentious issues regarding this invoice have to do with: i. the 5 extra samples that were taken; ii. the 4 extra HPC Heterotrophic Plate Count samples; iii. the 3 extra hours; iv. the 2 extra Dwis the Ministry of the Environment s Drinking Water Information System; v. chlorine; vi. Nitrates. When Mr. Winter was asked why the extra samples were required, he did not know and said to ask Veolia. When Mr. Cox was asked the reason for these extra samples, he said there could have been a power outage, but he was not sure. I find that when there are extra charges being passed on to the tenants, the onus is on the Plaintiffs to prove why those charges were necessary and that they were reasonable. I find that the Plaintiffs have not satisfied the onus. Accordingly, I disallow the charges for first 4 items above. For reasons given above, I allow the charge for nitrates, but disallow the charge for chlorine. Accordingly, a total of $ (including GST) is deducted from this invoice. Amount of invoice $ 1,012.07

15 15 Amount I allow to be charged to the tenants $ Veolia Invoice for October 2007: The only issue in dispute is the chlorine for which I deduct $ Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for November 2007: The only contentious issue is the chlorine for which I deduct $ Amount of invoice $ 1, Amount I allow to be charged to the tenants $ 1, Metcon Invoice for November 2007: The Defendants dispute the charge for the cuvettes. Mr. Winter said that cuvettes are little vials to put the reagent in for testing the water. For reasons given below, I find that the reagent is needed to do the testing of water. Accordingly, I find that the cuvettes are also needed. Therefore, I allow this charge as being a reasonable water-testing expense. Amount of invoice $ Amount I allow to be charged to the tenants $ Southwest Water Systems Invoice for December 2007: The Defendants dispute the charges for both the stenner tube and the free chlorine reagent. Mr. Cox said that the reagent is needed to do the testing of the water. Mr. Sturdy also said that reagent is part of water-testing. Accordingly, I find that the charge for it is a reasonable watertesting expense. Mr. Cox said that the stenner tube supplies the chlorine to the Heritage Estates water system. He referred to as a maintenance item for the pump. Mr. Sturdy said that the stenner tube is a regular maintenance item which has to be replaced quarterly. Accordingly, I find that the charge for a stenner tube is not a charge for the testing of water and disallow the expense. Therefore, I deduct $ (including GST). Amount of invoice $ Amount I allow to be charged to the tenants $ Metcon Invoice for December 2007: The Defendants dispute the charges for the reagent and for the Cal Standard. For reasons already given, I find that the reagent is needed to do the testing of water. Mr. Winter said that Cal Standard means a calibration meter used to test for chlorine. For the same reason that I found the charge for reagent to be a reasonable water-testing expense, I find that the Cal Standard charge to be a reasonable water-testing expense. Accordingly, I allow the full amount of this invoice.

16 16 Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for December 2007: The Defendants dispute the charges for the extra samples and for the chlorine. The issue of extra samples appears on several of the invoices to follow. According to this invoice, the extra sampling took place on November 28, 2007 because of a Precautionary Boil Water notice. As I said earlier, these Boil Water Notices were issued by the Plaintiffs in a variety of situations. It could be when there was a loss of water pressure or when the filters failed. Mr. Winter told me that the water treatment system uses hydro to operate. When the hydro goes off, the pump stops. Mr. Worsell said that the area around and including Heritage Estates is prone to hydro outages. If the hydro goes off in the pump house for long enough, the water pressure drops. Even though the Plaintiffs know about the higher risk for Heritage Estates to have hydro outages, Heritage Estates does not have a back-up generator. Mr. Worsell also said that some areas of Heritage Estates are prone to water line breakage. A factor in this is the age of the water lines in Heritage Estates. In fact, he said that the pipe would not meet today s Ontario Building Code standards. Mr. Sturdy said that losing pressure is an operational item. He said that Heritage Estates has pressure losses more frequent than other mobile home parks with which he has knowledge. He attributed this in part to the cartridge filters plugging up. As I have already found, when there are extra charges being passed on to the tenants, the onus is on the Plaintiffs to prove why those charges were necessary and that they were reasonable. No one gave me any reason to support the Precautionary Boil Water notice referred to in this invoice. Therefore, I do not know whether the charges for the extra sampling were reasonable. Hence, I find that the Plaintiffs have not satisfied the onus. Mr. Cox said that there were 3 extra samples, 2 extra HPC and 2 extra Dwis resulting from the Boil Water notice. Accordingly, I disallow the charges for those. Therefore, including the disallowance for chlorine, the total deduction from this invoice is $ (including 5 % GST). Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for January 2008: While this invoice referred to a Precautionary Boil Water notice, Mr. Cox said that was an error since it referred to the same notice which appeared on the invoice for December Therefore, the only contentious issue is the chlorine for which I deduct $

17 17 Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for February 2008: The Defendants dispute the charges for the extra samples and for the chlorine. There was a Boil Water notice on February 20, But the Plaintiffs did not prove why the notice was issued. Therefore, I have no evidence that the extra charges caused by it are reasonable. For the reasons given earlier, I disallow the charges for the extra testing (including the extra hours spent). Mr. Cox said that there were 5 extra samples, 2 extra HPC samples, 1 extra DWIS and 4 extra hours spent. Including the charge for chlorine, I deduct a total of $ (including 5 % GST). Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for March 2008: The Defendants dispute the charges for the chlorine, the nitrites, the extra samples and the work involved preparing the Annual Summary For the reasons given above (including those relating to nitrates), I allow the charge for nitrites, but disallow the charges for chlorine and the Annual Summary. The invoice refers to a Boil Water Notice. Mr. Winter said the extra samples were attributable to a system failure. Mr. Cox said there were 5 extra samples because of the Boil Water Notice. The invoice shows 3 extra hours were incurred because of the Boil Water notice. I don t know any more about why there were extra samples or extra hours other than what I said in the previous paragraph. The Plaintiffs have not proven why the notice was issued. Therefore, I have no evidence that the extra charges caused by it are reasonable. I am deducting a total of $ including GST from this invoice. Amount of invoice $ 1, Amount I allow to be charged to the tenants $ Veolia Invoice for April 2008: The Defendants dispute the charge of $ 1, for the semi-annual lead sampling. Mr. Winter said that in 2008 the lead sampling had to be done two times in the year. Mr. Cox confirmed that it was mandatory at that time. He also said it was a time-consuming test. Mr. Cox further said that now the test only has to be done once every 3 years. I find the lead-sampling test to be a reasonable water-testing expense.

18 18 Amount of invoice $ 1, Amount I allow to be charged to the tenants $ 1, Veolia Invoice for May 2008: The Defendants dispute the charges for the extra samples and the BFV. The invoice refers to a Boil Water Precautionary and additional work that Mr. Sturdy had to do on May 22 in connection with it. Mr. Winter said the extra samples were attributable to a system failure. Mr. Cox said the top 5 items on the invoice related to the Boil Water notice, whereas the next 7 items involved the regular testing. Again I don t know any more about why there were extra samples or extra hours other than what I said in the previous paragraph. The Plaintiffs have not proven why the notice was issued. Therefore, I have no evidence that the extra charges caused by it are reasonable. Mr. Cox said the BFV was likely a part for the well-house and classified it as an operational/maintenance item. Therefore, I find that it is not a reasonable water-testing expense. From this invoice, I am deducting a total of $ including GST. Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for June 2008: The Defendants dispute the charges for the nitrates and the extra samples. For the reasons given earlier, I allow the charge for nitrates. The invoice refers to a Boil Water Advisory on June 17 and additional work that was done in connection with it. Mr. Winter said the extra samples were attributable to a system failure. Mr. Cox referred to is as a negative pressure system failure. He further states that the bottom 3 items on the invoice related to the Boil Water Advisory, whereas the top 7 items involved the regular testing. Mr. Cox said that if the system had not lost pressure, there would not have been any need to issue a Boil Water Advisory or do the extra sampling. We don t know what caused the negative pressure system failure. Therefore, I have no evidence that the extra charges incurred because of it are reasonable. From this invoice, I am deducting a total of $ including GST. Amount of invoice $ Amount I allow to be charged to the tenants $

19 19 Veolia Invoice for July 2008: While Mr. Winter was testifying, Mr. Cornish said this invoice was not being challenged by the Defendants. However, in his written Submissions (referring to Page 34 of Exhibit 1), Mr. Cornish said that he was challenging the charges for some extra samples. As I review this invoice, I do not see any extra charges. Therefore, I assume that Mr. Cornish meant another invoice. I allow the full amount of this invoice. Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for August 2008: The Defendants dispute the charges for the extra samples and the leaking water service repair on July 18 and August 25. The total invoice is for $ 1, Mr. Winter said, and I agree, that the first 8 items on that invoice have to do with the normal water testing. Those items (including GST) total $ I am disallowing the charges for the extra samples in the amount of $ 19.20, since they are related to the leaking water. That still leaves a charge of $ for repairing a water leak. Repairing a water leak has nothing to do with water testing. Why would the Plaintiffs even consider charging the tenants for repairing it? Mr. Cox said that it was an operational /maintenance item. When Mr. Winter was asked about the charges for repairing the water leak, he first said they might have been charged to the tenants. Later when he was referred by his own representative to another Exhibit, he said these expenses were charged to the tenants. Why was Mr. Winter not better prepared to answer this question, especially when it involved an improper charge of almost $ 1, to his tenants. Why did Mr. Winter not immediately say in the witness box that he was withdrawing that charge? (He said it for some other expenses later in his evidence.) This is one example of the cavalier attitude that Mr. Winter sometimes conveyed in this trial about some of the charges that he tried to levy against his tenants. The trial could have been shortened considerably if the Plaintiffs and their representative had taken a closer look at all of the invoices and conceded some of the expenses at the beginning of the trial. With few exceptions, the Plaintiff has tried to pass on to the tenants the full amounts of the Veolia invoices, even where the items on the invoices clearly should not have been billed to the tenants. Mr. Winter or someone on behalf of the Plaintiffs should have been scrutinizing the items on the Veolia invoices more carefully to determine which ones were proper to pass on to the tenants. It is clear that in many of the invoices Mr. Cox and Mr. Sturdy knew which items should be passed on to the tenants and which ones should not. Perhaps Mr. Winter needs to ask Veolia for assistance. Or perhaps Veolia could provide the Plaintiffs with 2 invoices each month, one for passing on to the tenants and one for the Plaintiffs to absorb. Whichever method is used is likely going to be much less expensive than what this trial has cost the parties.

20 20 From this invoice, I am deducting a total of $ 1, Amount of invoice $ 1, Amount I allow to be charged to the tenants $ Veolia Invoice for September 2008: The Defendants dispute the charges for the nitrites, the lead sampling, the replacement of the alarm dialer and a call out. For the reasons given earlier, I allow the charge for nitrites and lead sampling. Mr. Winter said that the replacement of the alarm dialer was done at the request of the Ministry of the Environment. He conceded that this charge was not related to water-testing. Therefore, I disallow it. As far as the call-out is concerned, Mr. Cox was not sure if it was an operational/maintenance expense or a water-testing expense. He said that it was in response to an after-hours call. The wording on the invoice is Call to check well house reservoir and system pressure. Backwashed filter, cleaned filter injector, and rinsed filter. Mr. Winter conceded that if it had been the replacement of a filter, it would have been an operational/maintenance item and not water-testing. But he said since it was cleaning, and not replacing, a water filter, it was a water-testing expense. I disagree. But if I am wrong about it not being a water-testing expense, then I find that it is not a reasonable water-testing expense which can be charged to the tenants. Therefore, I am deducting a total of $ including GST from this invoice. Amount of invoice $ 2, Amount I allow to be charged to the tenants $ 2, Veolia Invoice for October 2008: The Defendants dispute the charges for the extra sampling and the October 19 call in. The invoice refers to a Precautionary Boil Water on September 28 and the additional work that was done in connection with it. Mr. Winter said the top 8 items involved the regular testing, whereas the next 7 items related to the Precautionary Boil Water Advisory. He said the last item referred to the October 19 call in which was caused by a low reservoir tank and the replacement of filters. Even though Mr. Winter stated, when he was talking about the September 2008 invoice, that the replacement of a water filter was an operational/maintenance item, he did not make that same concession when he talked about this invoice. Mr. Cox was very clear changing filters is not testing.

21 21 Mr. Cox said the extra samples were attributable to a negative pressure system failure. We don t know what caused the negative pressure system failure. Therefore, I have no evidence that the extra charges incurred because of it are reasonable. Mr. Cox said that the charge for the October 19 call in was an operational issue, and not watertesting. He did not recall why the water became low in the reservoir tank. He said it could possibly have been caused by a filter becoming plugged. But we don t know for sure. I find it had nothing to do with water-testing. Therefore, for the reasons already stated, I find that none of the last 8 items on this invoice are charges that should be passed on to the tenants. From this invoice, I am deducting a total of $ including GST. Amount of invoice $ 1, Amount I allow to be charged to the tenants $ Veolia Invoice for November 2008: The Defendants dispute the charges for the chlorine, the organics, repairing a leaking pipe on November 1, replacement of a UV light on November 15 and repairing a pipe on Main St. on November 17 and the extra sampling that resulted. As far as the $ charge for organics is concerned, Mr. Cox said that it is a required yearly test. Therefore, I find that it is part of the normal required water-testing and is a reasonable expense. Mr. Winter pointed out that the tenants were not charged for the November 17 th repair of the pipe on Main St. However, they were charged for the water-testing that took place after the repair was completed. The tenants were also charged for repairing the leaking pipe on November 1 st. Mr. Winter conceded that the November 1 st repair was not water-testing and therefore should not have been charged to the tenants. I find that the water sampling that had to take place after the repairs of both pipes was not a reasonable water-testing expense that should be charged to the tenants. Mr. Winter also stated that the replacement of the UV light is an operational expense, not a water-testing expense. Accordingly, I am deducting a total of $ including GST from this invoice. Mr. Winter conceded most of that reduction when he gave his evidence. It would have helped to shorten the trial if he had done that at the beginning of the trial. Amount of invoice originally charged to tenants $ 1, Amount I allow to be charged to the tenants $ 1, Veolia Invoice for December 2008: The Defendants dispute the charges for the nitrates, the November 28 work, and the last 4 items which have to do with the December 27 th Precautionary Boil Water Power Outage.

22 22 For the reasons given above, I allow the charge for nitrates. According to Mr. Cox, the November 28 charge did not involve water testing. Therefore, I disallow the charge. The last 4 items on the invoice are connected to a Precautionary Boil Water notice that resulted from a power outage. The Plaintiffs have the burden to prove that they took all reasonable steps to prevent the power outage. There was no evidence presented as to what caused the power outage. As I have already stated, the evidence indicates that Heritage Estates was prone to more frequent power outages than the other mobile home and trailer parks with which the Veolia employees were familiar. I have already noted that the Plaintiffs do not have a back-up generator. I am not satisfied that the Plaintiffs have met the onus that is on them. As a result, I find that the last 4 items on the invoice are not reasonable water-testing charges that should be passed on to the tenants. By making this comment, I am not implying that the charges by Veolia to the Plaintiffs are too high or are unreasonable. Therefore, I deduct $ including GST from this invoice. Amount of invoice $ 1, Amount I allow to be charged to the tenants $ Metcon Invoice for January 2009: The Defendants dispute the charges for the reagent. For reasons already given, I find that the reagent is needed for water testing. Accordingly, I allow the full amount of this invoice. Amount of invoice $ Amount I allow to be charged to the tenants $ Veolia Invoice for January 2009: The Defendants dispute the charges for the last 5 items which have to do with the January 19 th Precautionary Boil Water notice. The invoice is very clear. The January 19 th incident had to do with a broken line at one of the mobile homes. In fact, the mobile home in question was either owned by or in the care of Mr. Winter. The rest of the tenants should not be charged for the items that relate to it. Mr. Winter conceded that under cross-examination by Mr. Cornish. Accordingly, I reduce this invoice by $ Amount of invoice $ Amount I allow to be charged to the tenants $