Replacing Kitec Plumbing in your high rise condominium

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1 Replacing Kitec Plumbing in your high rise condominium A Quick Guide for property managers to help navigate the complex process from start to finish. Prepared by Canadian Design and Construction Inc. (CDC). Information contained in this guide is based on current industry research as of Our website dedicated to this issue is kept up-todate, please refer to it as needed. For a more comprehensive guide, please contact us for a consultation. 1 Time is (not) on your side. You can t put the genie back in the bottle. Cause for concern: The discovery of Kitec pipes and fittings in your condominium. Kitec brass Fittings deteriorate, and pipes can split, leading to water escape emergencies of unpredictable measure. Kitec Plumbing: Just what are we dealing with? Kitec piping and fittings were installed in condo units for hot and cold potable water in buildings constructed between 1994 and They can be found in kitchens, laundry areas and bathrooms. If your building was constructed during this time period, there is a very high probability that Kitec plumbing is used in your building s units. Kitec plumbing systems have been shown to fail in two ways: the pipes can rupture and the brass fittings can deteriorate. Both issues get worse with time, leading some experts to assert that failure is not a matter of if but of when. Remediation is the recommended course of action, by removal and disconnection of Kitec fittings and pipe, and replacing them with new plumbing (Uponor PEX systems). At Canadian Design and Construction Inc. (CDC), we created this guide for you to better understand how other corporations are proceeding with remediation with varying degrees of success. We can provide you with a more detailed guide to further assist you. Once made known to the condo corporation, the presence of a product like Kitec plumbing in the units must be declared on a building s Status Certificate / disclosure statement, treated as a material change. Understandably, it becomes the goal of most Condo Boards to rectify this as soon as possible, since the presence of Kitec affects everything from insurance premiums to resale values for property owners due to the real risk it poses. And word is getting around. The possibility of a water escape incident from rupture, potentially leading to property damage or injury from scalding, is a scenario almost everyone would avoid, given the choice. Adding to the urgency of the matter, though the pipes are used solely within the individual units, catastrophic damage to several units, mechanical systems, or common areas can occur. Even a small, dripping leak can lead to mould and mildew growth which can spread. The risk increases as time passes due to the deterioration of the materials. Kitec Failure Risks Mould growth property Injury from scalding neighbouring units due to water escape common elements, mechanical systems Canadian Design & Construction Inc (1CDC) info@cdcpro.ca

2 Kitec has been making headlines with increasing frequency. Reference: Toronto Star Website How did this happen, Who is responsible? Before you direct your disapproval or queries to the builder, understand that most legal experts consulted hold the opinion that the builders who installed the plumbing are not responsible, given that they were using a CSA-approved material at the time of construction they did nothing wrong. Kitec was the most popular, and most commonly used material for its purpose, and there was no way for builders to know that the product was faulty. Once it became public knowledge, its use was halted. There was no formal, government recall. Builders stopped using Kitec around 2007, when failure was seen to occur and its manufacture halted. In 2011 a settlement sum of 125 million dollars USD was set up to compensate homeowners, who can file a claim for the class action before the cut off date in Finally, in high rises, Kitec plumbing systems were only used in the units (not common areas), and are connected to the main risers; this places them decisively within the boundaries of the individual units. The responsibility for the obligation and cost to replace the piping thus lies entirely with the property owner. The Roles of Key Professionals Due to the unprecedented nature and uncertainties of the issues presented by the Kitec problem, it is imperative to work with the following professionals and understand the advisory roles they play: Condominium Engineer - Once the issue of replacement is on the Board s radar, your Corporation s building engineer should be involved in the process. From revealing the presence of Kitec, to explaining the risk to common areas and understanding how it interacts with the building s mechanical systems, to approving and working with contractors to carry out the remediation, your engineer can be a trusted and reliable source of expertise who can document the situation as s/he goes. The engineer can provide technical floorplans to bidding contractors during the the tender process. Legal Professional - After you notify your Board, the next call should be to your building s solicitor. A lawyer will be able to advise you on matters of responsibility and accountability, research prior cases and precedents, and help you to inform your Board and homeowners. Accountant/Auditor - Since water escape due to Kitec failure can impact the building s common areas, your auditor may approve or recommend expensing some of the costs such as security personnel and engineer certification of the units, payable from the corporation s reserve fund. This can reduce the cost burden on the unit owners. Insurance Broker - Understanding all the variables that can affect the building s and unit owner s insurance premiums will be important. Policies differ widely. 2 Canadian Design & Construction Inc (1CDC) info@cdcpro.ca

3 5 Steps to Remediation A Best Practice Overview 2. Work out a Plan. There are a few different models to consider, and in the following pages you can compare some of the ways you can replace the entire building s potable water plumbing systems. Your lawyer, insurance broker and engineer should be consulted for the most thorough consultation. Being informed and staying current will help you to make the best decision for your building. 3. Host a Town Hall discussion. Communicate like a pro, by inviting the pros. An owners meeting will need to take place, ideally with a presentation by the Board. Consider hiring a facilitator in addition to having a legal representative, the building s approved engineer and a Kitec replacement specialist (contractor), to thoroughly inform and support the discussion. 4. Fix the Problem, remembering the human element. Communication with the right stakeholders at the right stages will lead to a successful outcome. 1. Stop, Look, and Listen (Start with the facts). Before you do anything, be sure you have verified that Kitec is present. Communicate to the Board that you are consulting with your engineer and legal professional. The engineer, often working with a contractor specializing in Kitec removal, will verify the presence of Kitec in a unit. Collect all documentation so you can start with all the facts. Once the presence of Kitec has been established, present your findings to the Board and determine your course of action. It will benefit the condo corp, the board, and all owners to stay engaged with property owners in a positive way throughout the entire process. Selecting a contractor who understands the condominium community will go a long way to ensure a smooth transition during a trying time, when tensions can rise and misunderstandings can occur. 5. Peace of Mind, Certified. The swift return to a Status Certificate that is Kitec-Free is something to be celebrated; a big accomplishment that you should document as an event in your condo community s history that shows how well your team came together to avoid disaster. 3 Canadian Design & Construction Inc (1CDC) info@cdcpro.ca

4 What are some of the Replacement Options? 3 Models to consider We have identified three methods that we have seen with variable rates of success. Let s explore them here: Model 1 Hands Off Model 2 Hands On - Bulk Replacement What: Leave it up to the individual unit owners to find their own plumbing contractors to do the job, and simply ask that they provide a certificate that the work was done. Pros: Carries virtually no administration costs for project management, and offers free choice to each homeowner so they feel empowered and can control their costs and their own schedule. Cons: Dozens of different contractors coming into the building with differing standards of work, unknown experience with Kitec pipe or the recommended replacement product (Uponor PEX). Engineers will likely not approve work done by an outside contractor. The corporation can never be certain of what is inside the walls, once sealed. Case Study: Building X notified the owners that they had to comply with replacement by a given date, yet provided no referrals. Unit owners selected their own plumbers. One unit owner hired a well-known company advertising themselves as Kitec replacement specialists. The company provided their own inspection of the work, and the building s manager did not verify independently that the work was done correctly, or was done under the supervision of a Uponor-certified replacement specialist. The pipes burst in the unit, causing a major water escape incident which led to damage in 5 neighbouring units. What: After gathering quotes, the condo corporation selects one contractor to do a wholesale replacement of all the units in the building. The management team administers and manages the project, paying the contractor and managing receivables. They offer an opt-out option for homeowners. Pros: The process is simpler, with only one known contractor to deal with. The unit owners get a negotiated, bulk price, and deal only with the management office, who is familiar to them. There is greater control over the whole process and one main contractor is accountable. Cons: Without competition, contractors won t work as hard to please the homeowners, who have no options to make improvements. Property managers take on a huge responsibility in addition to their daily work in managing the financials. Also, the cost to create a bulkhead in the units, as is often necessary, is not generally included in the quotation, and can be a surprise cost to the homeowner. Case Study: Corporation Y chose a contractor for its building based on bulk price and referrals. Confident in their choice, they informed the homeowners and began replacement. Once the technicians were in their homes, unit owners were surprised by the limited communication and choices they had with the plumbers. They were left to cover many of their own belongings to protect from dust, and found they were dealing with plumbers did not offer interest in serving the homeowners, whom they did not view as their client. 4 Canadian Design & Construction Inc (1CDC) info@cdcpro.ca

5 Model 3 - The Happy Medium What: A hybrid of the models 1 and 2, the condo board chooses three contractors after much research and a tendering process, and offers these three contractors as options to the homeowners to complete the work. Pros: The best price is offered as in Model 2, but other options are given. The corporation may pay for engineer certification of the work out of the reserve fund, which lessens the financial burden on homeowners, and also gives peace of mind that the approved professionals have certified the job. The contractors are familiar to the engineer, providing additional reassurance. Competition between contractors generally improves quality of work, leading to greater satisfaction among homeowners. Cons: The project can take a little longer as the unit owners are more involved in the process. Our Recommendation CDC, after extensive research and observations in the industry, recommends Model 3, because it presents the most favourable outcome for all parties involved, and that the all or nothing approach many boards end up taking is not the best way forward. We have observed that viewing this project as a partnership between the corporation, homeowners, and approved contractors generally results in the most successful outcome for all. Model 3 ensures that homeowners feel the most valued, which is key since they bear the weight of this problem and are the key to positive action. About CDC Canadian Design and Construction Inc. (CDC) is a renovation and construction company which has come to specialize in providing services to condominium environments. CDC understands the unique needs of the condominium community and its procedures. We are Associate members of ACMO (Association Of Condominium Managers Of Ontario) and CCI (Canadian Condominium Institute). We have worked extensively with condo Boards, engineers and management teams. We have deep and thorough understanding of the Condo Act, bylaws and rules as laid out in the Condominium Declaration documents, and we strictly abide by the High Rise Building Code. When you work with our team, you will be working with manufacturer-certified and trained pipe installation specialists (trained by Uponor of Sweden), employing engineer-approved materials and methods. Sample our Kitec replacement services: When faced with Kitec plumbing system remediation, we are here to help, and we believe that knowledge is power. Our professionals can work with your corporation and its engineers to determine the scope remediation of work for your building, by offering a sample suite turn-key Kitec replacement at a discounted rate. A maximum of 2 sample suites will be offered for the purposes of understanding actual process in your particular building (1CDC) info@cdcpro.ca