Catching Renovation Deficiencies Before the Final Cheque Cleared

The situation

Meron worked as an air traffic controller, a job built around precision and checklists, and she brought the same instincts to the second-storey addition she and her husband Biniam were having built on their Windsor home. The project was substantial: a full second floor added over the existing footprint, new roof, new plumbing stacks, and a rebuilt electrical panel to carry the extra load. The contract price sat at roughly $620,000, staged across a series of payments tied to construction milestones, with a final payment due once the contractor certified the work complete.

Biniam had an advantage most homeowners do not: he worked as a construction project manager, though on commercial sites rather than residential ones, where the trades, inspection cadence, and paperwork expectations are considerably more formal. He kept an eye on the framing and rough-in stages as they went, sitting in on a handful of site visits during the first four months, and nothing looked obviously wrong from what he could see with the walls still open. The contractor, Bohdan, ran a small crew and had a reasonable local reputation, with several finished additions in the neighbourhood that Meron and Biniam had toured before hiring him. By the seven-month mark, the addition was substantially finished, the final walkthrough was booked, and the last invoice — close to $60,000 — was sitting in Meron's inbox waiting to be paid.

On paper, everything about the project had gone the way a renovation is supposed to go: on budget, close to schedule, and with a contractor who answered his phone. That was part of why the couple almost paid the final invoice without a second look. It was Biniam's residential-side instinct, sharpened by years of commercial punch lists, that made him pause before signing off. Meron, for her part, kept coming back to the same thought that shaped her own working life: a project that looks clean from the outside is exactly the kind where a checklist, not a gut feeling, catches what a walkthrough alone would miss.

What the second look found

Before signing off, Biniam asked a colleague who worked in residential inspection to walk the site with him informally, mostly as a courtesy check rather than out of specific concern. That walkthrough turned up three problems that were not visible from a normal homeowner's inspection: the new roof valley over the addition had been flashed in a way that would likely leak within a few winters once ice and debris built up in the joint, one of the new plumbing stacks had an inadequate vent that could cause slow drains and sewer gas smells as the household relied on it more heavily, and the electrical panel upgrade had not been signed off by the utility, meaning the new circuits were live and in use but had never actually been verified against the electrical safety code.

None of these were catastrophic on their own, but together they represented real remediation cost — the inspector's rough estimate ran from about $30,000 at the low end to as much as $70,000 if the roofing problem had already caused hidden water damage behind the new drywall, since tracing and drying out a slow leak inside a finished wall assembly is far more expensive than fixing the flashing itself. More importantly, once the final payment went out and the statutory holdback period lapsed, the couple's practical leverage to get the work fixed would drop sharply. A contractor who has been paid in full and released from the project has little day-to-day incentive to come back for repairs that eat into his own margin, and chasing him afterward would mean starting from a position of asking rather than requiring.

Meron and Biniam came to Treadstone Law with the invoice unpaid and the final walkthrough already behind them. They wanted to know exactly what their rights were, and what payment they were legally required to make, before they released one more dollar.

What we did

1. Confirmed the final payment, holdback included, had not yet gone out. The Construction Act holdback is not an owner's deficiency-repair fund — it is a fixed percentage of the contract price, retained from the start of the job and released once the lien periods have run after substantial performance is published, and its purpose is to secure subcontractors and suppliers who go unpaid by the contractor. A claim over the roofing, plumbing, and electrical problems was a separate contractual matter, and the couple's right to hold back or set off against the holdback itself was limited. Their real leverage was simpler: they had not yet paid the outstanding invoice, and an owner is entitled to withhold payment for work that isn't done properly. We confirmed Meron and Biniam still had that money in hand, which meant they had real security rather than just a verbal complaint.
2. Arranged a formal deficiency inspection. An informal walkthrough from a colleague was useful for spotting the issues but would not carry weight in a negotiation with a contractor who had every incentive to downplay them. We retained a licensed home inspector to produce a written report itemizing each deficiency, referencing the applicable building code provisions, and providing a defensible repair cost estimate, so that whatever came next rested on a document that could hold up if the dispute escalated rather than a rough guess.
3. Sent a deficiency notice to the contractor before paying the final invoice. Rather than paying and then trying to claw money back later — which almost always means litigation — we wrote to Bohdan setting out the specific deficiencies, attaching the inspection report, and proposing that the final payment and holdback be released only once the roofing, plumbing vent, and electrical sign-off issues were corrected and verified.
4. Negotiated a repair-first resolution instead of a lawsuit. Because the money had not yet changed hands, Bohdan had a direct incentive to fix the problems rather than fight about them. We negotiated a short, written agreement: Bohdan would complete the repairs within a defined window, obtain the utility sign-off on the electrical work, and the couple would pay the outstanding balance only after a follow-up inspection confirmed the fixes.
5. Documented everything in case it went sideways. Even though the matter was heading toward a cooperative resolution, we kept a full paper trail — the original inspection report, the notice letter, the repair agreement, and photographs — in case Bohdan failed to complete the repairs and the couple needed to pursue a claim through the Superior Court or rely on their holdback rights formally.

The outcome

Bohdan corrected the roofing detail and the plumbing vent within a few weeks, and arranged the outstanding electrical inspection with the utility shortly after. The follow-up inspection confirmed the work met code, with no evidence of the hidden water damage the couple had worried about. Meron and Biniam released the final payment, including the holdback, once everything was verified — a total outlay of roughly $60,000 that would otherwise have gone out the door with unresolved problems sitting behind the drywall.

No lawsuit was ever filed. No expert had to testify at a hearing, and no one spent months in a Small Claims Court or Superior Court queue arguing over whose workmanship standard applied or whether a deficiency was the contractor's fault or ordinary wear. The couple's total additional cost was the inspection report and the legal work to negotiate the repair agreement — a fraction of what a post-payment dispute over $30,000 to $70,000 in remediation would likely have cost in both money and time, before even counting the stress of living in a house with an unresolved roof leak over a winter. The roofing issue in particular was the kind of problem that gets dramatically more expensive the longer it sits undiscovered; catching it before a winter of freeze-thaw cycles, rather than after, was probably the single biggest saving in the file.

The case is a reminder that construction disputes are usually cheapest to resolve at the moment just before final payment, when both sides still have something real to gain from cooperating — the contractor wants to be paid, and the owner still holds the money that makes that possible. Wait until after the cheque clears and that balance of leverage flips, and the same conversation that took a few weeks here can stretch into months of correspondence, or a claim, with no guarantee of a faster or cheaper result.

What you can learn from this