Homebuilder penalized for breach of contracts

The Home Construction Regulatory Authority (HCRA) investigation has led GC King Bond GP Inc. to return $1.1 million to purchasers of Richmond Hill townhouses. The HCRA determined the developer pressured buyers into accepting price increases not outlined in their original contracts.

GC King Bond sold 110 units between 2020 and 2021. In May 2022, the company informed buyers the project might fail unless they agreed to price hikes or terminated contracts for refunds. However, the contracts contained no provisions for such increases or terminations, and purchasers were not told they could reject the changes.

“Licensed builders in Ontario are required to inform purchasers of all their options,” said Wendy Moir, HCRA CEO.

The HCRA’s penalties ensure buyers who paid the increase will be reimbursed, while GC King Bond dropped demands for an additional $5.3 million.