Feds tried to hide complicity in leaky condo crisis

Thursday, November 10th, 2005

Peter O’Neil

OTTAWA — A newly released internal federal government document proves the federal government attempted to cover up its complicity in B.C.’s $1.5-billion leaky condo crisis, Conservative MP John Cummins said Wednesday.

Cummins released to The Vancouver Sun a 1981 letter from Ray Hession, who, as president of the Canada Mortgage and Housing Corp., was warning federal colleagues and senior provincial bureaucrats that new federal conservation measures could lead to moisture damage in coastal residential homes.

Hession was responding to an earlier letter from M.A. (Mickey) Cohen, then deputy minister of energy, mines, and resources and the senior Ottawa bureaucrat often dubbed the architect of the controversial National Energy Program.

Hession, in his reply to the Cohen letter, reveals there was concern at the federal bureaucracy’s highest levels over the possible NEP link to future damage to Canadians’ homes in wet climates.

“Thank you for your letter of Sept. 29, in which you expressed your concern about having energy conservation associated with moisture problems arising from various forms of house construction,” Hession wrote on Nov. 13, 1981.

“I agree that we must avoid creating the impression that conservation measures will necessarily entail excessive moisture problems or indeed other construction or occupancy problems.

“Nevertheless, I feel it equally important for us to collectively face up to the reality that construction practices associated with energy conservation measures do, in fact, increase the hazard of moisture induced structural damage.”

Hession had written on Aug. 27, 1981, to the National Research Council’s committee responsible for the National Building Code, warning of the “emergency” matter of moisture damage that is “potentially serious, possibly widespread and … concerns matters of structural safety and public health.”

Cummins, who has been digging up internal documents for months on the issue, still hasn’t obtained the Cohen letter that triggered Hession’s response.

But he said the Hession-to-Cohen letter represents the “smoking gun” that suggests Ottawa needs to compensate the crisis victims.

“There is now clear and unassailable evidence that not only did CMHC know full well there was a serious wet wall problem caused by the federal government’s energy conservation measures, but there is now clear evidence as well that CMHC was under pressure to cover up the problem to protect the National Energy Program,” Cummins said in a statement.

“The smoking gun should put an end to the denials of liability from CMHC.”

A number of critics have alleged when the leaky condo controversy broke in the 1990s that the federal conservation measures, intended to seal homes and eliminate drafts, prevented houses from drying out and resulted in wood rot.

But a commission of inquiry established under former B.C. premier Dave Barrett rejected that theory and any suggestion that the condo crisis, which has devastated owners of thousands of rot-damaged homes in B.C., was caused by conservation requirements in the National Building Code.

Cummins has flooded federal ministers with questions on the issue, but Industry Minister David Emerson and Housing Minister Joe Fontana have refused to discuss the internal documents because the issue is before the courts.

Fontana, however, said that the moisture concerns expressed by Hession and other officials in 1981 were related to developments in Newfoundland, and that those issues were “very different” from the subsequent B.C. disaster.

Cohen, who works for the Toronto law firm Cassels Brock, did not return telephone calls and e-mails Tuesday and Wednesday.

Hession, now semi-retired and reached at his Ottawa home, said Wednesday he doesn’t believe the letter to Cohen suggests a cover-up.

“I would say the exchange would be more in the nature of guarded, sort of small-p politics [suggestion to] ‘watch what you say because we’re in the process of promoting energy conservation.’ “

Hession said he would only agree that the NEP measures were a “potential contributing cause” to the condo crisis, but said there likely were other factors.

“There may have been issues relating to building materials, construction standards, inspection, or engineering certification. All of these things play.”

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© The Vancouver Sun 2005

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