Mike Holmes' company named in $8M lawsuit over Meaford, Ont. housing development

Mike Holmes' company, The Holmes Group, is accused of promoting the homes under his 'Holmes approved Homes' program, court documents say. (The Canadian Press / CTV News Toronto)

The property development company owned by TV personality Mike Holmes is being sued after allegedly being involved in the development and promotion of more than a dozen houses in Meaford, Ont. that homeowners say have "numerous deficiencies."

A statement of claim obtained by CTV News Toronto, names The Holmes Group (Holmes' company) among about a dozen parties involved in the housing development.

The $8-million lawsuit, which was filed in December 2021 by consumer protection organization Tarion, alleges Third Line Homes built 14 properties in which suffered from a large number of deficiencies such as leakages, mould and structural flaws. Third Line Homes' principals and officers Mary-Jo and Paul Osbornof are also among those named in the lawsuit

The homes are located on Gordan Crescent in Meaford, a Georgian Bay community located about 100km northwest of Barrie.

Tarion says many of the defects “raise serious safety concerns” and that subsequent safety inspections were not completed. The organization also alleges Third Lines Homes failed to fix the defects or process subsequent warranty claims, and that, in turn, Tarion has been paying for the repairs out of pocket.

The Holmes Group is accused of promoting the housing development under his 'Holmes approved Homes' program, court documents say.

None of the allegations have been proven in court.

The neighbourhood was touted the homes as being "Mike Holmes approved." (CTV News Toronto)

WHAT IS THE TERRACEWOOD DEVELOPMENT?

The TerraceWood Development, constructed by Third Line Homes, was originally advertised to potential buyers as a sustainable "boutique neighbourhood of healthy homes in a beautiful harbour town."

The website promoting the development is no longer active, but archives show it touted the homes as being "Mike Holmes approved."

Holmes, a Canadian developer and TV personality, is primarily known for his HGTV television series Holmes on Homes in which he rescues homeowners from renovations gone wrong.

Construction of the development took place between 2015 and 2019, with residents moving in on a staggered basis from 2016 to 2019, the documents say.

But, court documents allege when homeowners started moving in, they began to discover “and continue to discover” their homes contained defects – faulty roofs caused leaks, which in turn caused water damage and mould; the structural framing of the home couldn’t support the load, allegedly requiring emergency shoring; and thermostats and HVAC systems failed to operate properly.

CTV News Toronto visited the street on Thursday and found several construction crews working on the houses. A number of the houses involved in the lawsuit also had large signs warning they were not safe to enter without proper personal protective equipment.

Tarion alleges the cost of repairs will exceed $8 million.

In a statement of defence, Mary-Jo and Paul Osborn, who were named on behalf of Third Line Homes, state the Gordan Crescent properties were sufficiently built and free of defects.

Moreover, they claim Tarion failed to properly communicate homeowners' complaints, and falsely told the owners that Third Line Homes was “unwilling” or “unable” to address the complaints.

The Osborns allege this miscommunication resulted in an inability to address complaints, causing homeowners to withhold money owed to Third Line Homes and putting the company into financial ruin, court documents say.

Many of the homes listed in the statement of claim currently have signs posted in the windows warning it is unsafe to enter without proper equipment. (CTV News Toronto)

HOW DOES MIKE HOLMES FIT IN?

Tarion is alleging The Holmes Group used its 'Holmes approved Homes' program to promote the sales of TerraceWood homes, misrepresenting Third Line Homes and the quality of their builds in the process.

A Twitter account used to promote TerraceWood, last active in 2016, shows a photo of what appears to be Holmes giving a thumbs-up in front of a home he reportedly purchased within the development.

In 2015, The Meaford Express reported the HGTV host was hosting a "Mike Holmes Bobble Head Hunt, "which offered participants the chance to meet Holmes. To enter, residents had to travel to the TerraceWood presentation centre.

Tarion also alleges The Holmes Group failed to carry out promised inspections.

In a statement to CTV News Toronto, John Doran, general counsel for The Holmes Group, said he was not able to provide comment on matters in front of the court, but added Holmes’ company did not build any of the TerraceWood homes, “nor did it directly participate in their construction.”

Tarion alleges the cost of repairs will exceed $8 million. (CTV News Toronto)

“The "Holmes Approved Homes" program is customized with each participating home-builder to present to their clients; it is the responsibility of each such builder to explain the program options and potential costs to the buyers of the homes that it builds,” Doner said.

“If, and only if, the builder registers any particular construction-project into the Holmes Approved Homes database will such residence receive the inspections. In this case, the builder did not register any of its homes in the Holmes Approved Homes program, and, as a result, no inspections were conducted.”

In its statement of claim, Restovate LTD., a trade name for The Holmes Group, said it either has no knowledge of or denies all claims made against it. It says it "made no representations" to homeowners and "had no involvement" with the project.