April 5th - 2009

Health Canada issues advisory on foam insulation

Urea formaldehyde foam insulation (UFFI) has been sold illegally in Canada. In a consumer advisory, Health Canada says RetroFoam of Canada Incorporated imported and illegally sold RetroFoam insulation.

Urea formaldehyde foam insulation (UFFI) has been sold illegally in Canada. In a consumer advisory, Health Canada says RetroFoam of Canada Incorporated imported and illegally sold RetroFoam insulation.
 
Once Health Canada became aware the Hazardous Products Act had been contravened, the department took prompt compliance and enforcement action. Health Canada issued a "cease and desist" letter to RetroFoam of Canada Incorporated, the Canadian importer of the insulation, to stop all importation and sale of RetroFoam in Canada. Health Canada also instructed Enerliv, the Canadian distributor of RetroFoam, to stop all sale, advertisement and further installations of the product and to call back any unused product. RetroFoam, RetroFoam of Canada Inc., and Enerliv were placed on Canada Border Service Agency's automated system target list to prevent any future importation of this product. As a result of Health Canada's actions, RetroFoam is no longer available for sale or installation in Canada.
 
RetroFoam of Canada Inc. is responsible for ensuring that the products they import, sell or advertise meet the requirements of the Hazardous Products Act and its regulations. Health Canada is currently reviewing its legal options.
 
Urea formaldehyde insulation is prohibited in Canada because it may release formaldehyde gas into indoor air. Health Canada is taking further regulatory action to protect the health and safety of homeowners who have had RetroFoam installed in their homes by supporting them in having their indoor air quality tested.
 
Health Canada’s advisory provides information for homeowners including a number to call to arrange for Government support to have their air quality tested. Health Canada says additional information will be available on its Web site http://www.hc-sc.gc.ca/ahc-asc/media/advisories-avis/_2009/2009_11-eng.php shortly.
 
REALTOR® responsibility
Approximately 700 homes in Ontario have been insulated with the banned formaldehyde-based product in the past 18 months, RECO reported on its Web site in March. It is important for REALTORS® to be aware of this issue and be on the lookout for it in order to protect their clients.
 
But, being aware of the issue is not only good business. REALTORS® are obligated under the RECO code of ethics to disclose all material facts related to a property and to communicate this information to the public. Section 21 of the REBBA 2002 Code of Ethics states:
 
Material facts
21. (1) A broker or salesperson who has a client in respect of the acquisition or disposition of a particular interest in real estate shall take reasonable steps to determine the material facts relating to the acquisition or disposition and, at the earliest practicable opportunity, shall disclose the material facts to the client.
 
(2) A broker or salesperson who has a customer in respect of the acquisition or disposition of a particular interest in real estate shall, at the earliest practicable opportunity, disclose to the customer the material facts relating to the acquisition or disposition that are known by or ought to be known by the broker or salesperson.
 
As Merv Burgard has said in the Legal Forum “The issue of UFFI disclosure is one that raises several issues and some disagreement as to its impact on property values. However, it is still a significant concern to several buyers and lenders and, for that reason, is still included in the OREA SPIS and OREA’s Agreement of Purchase and Sale. It is still a possible “material fact” that should be discussed with consumers and with the appropriate disclosure made.”
 
OREA includes a statement about UFFI in the Seller Property Information Statement (SPIS) (Form 220). A seller of a home that has had UFFI should answer the questions in the Environmental and Improvements and the Structural sections pertaining to environmental problems and UFFI.
 
Clause 23 of the Agreement of Purchase and Sale (Form 100) reads: “UFFI: Seller represents and warrants to Buyer that during the time Seller has owned the property, Seller has not caused any building on the property to be insulated with insulation containing urea formaldehyde, and that to the best of Seller's knowledge no building on the property contains or has ever contained insulation that contains urea formaldehyde…..”
 
There are also six different clauses UFFI clauses (UFFI -1 to UFFI-6) dealing with issues from knowledge to corrective action to testing for UFFI. See Standard Clauses.
 
Health Canada describes RetroFoam as a urea formaldehyde-based thermal insulation. This type of insulation was prohibited in Canada in December 1980 under the Hazardous Products Act. Health Canada was recently advised that RetroFoam has been installed in a limited number of homes in Ontario.
 

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Ontario Real Estate Association

Jean-Adrien Delicano

Manager, Media Relations

JeanAdrienD@orea.com

416-445-9910 ext. 246

Ontario Real Estate Association
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