Google Inc. denied it reached a “sweetheart deal” with British tax authorities as a dispute continued over the 130 million-pound ($185 million) settlement, which was called a victory by the U.K. Treasury and dismissed as “derisory” by opposition lawmakers. U.K. Business Secretary Sajid Javid separately said the agreement “wasn’t a glorious moment” and he shares “the sense of unfairness” felt by small businesses that are unable to use the tools available to multinational corporations to keep their taxes low. “Work needs to be done” to ensure they pay the correct share, he said. “It’s not a sweetheart deal, it’s a settlement with HMRC,” Peter Barron, Google’s U.K. head of communications, told BBC TV’s Andrew Marr Show on Sunday, referring to Her Majesty’s Revenue and Customs. “Government puts the laws in place, HMRC enforces the laws and we follow the laws. If the laws change, of course we would follow them.”
Google parent Alphabet Inc. agreed to pay tax going back 2005 after talks with U.K. tax authorities, while across Europe the company was criticized for using innovative tools to keep its tax rates low. HMRC has been faulted for not securing more money after reports that France and Italy are demanding higher settlements from the Mountain View, California-based company. The U.K. agreement was announced Jan. 23. Separately, the Sunday Times reported that six of the 10 biggest companies in the benchmark London Stock Exchange index, including Royal Dutch Shell Plc, SABMiller Plc and AstraZeneca Plc, paid no U.K. corporation tax for 2014. The companies told the newspaper that losses, minimal revenue in the U.K. revenue and expiring drug patents meant the company didn’t have to pay the taxes.
Javid defended the context of the U.K. deal, which Chancellor of the Exchequer George Osborne described as “a victory” for the government. It has been criticized by lawmakers, including Conservative Mayor of London Boris Johnson and the opposition Labour Party, which said the company’s effective tax rate was as low as 3 percent.
“It wasn’t a glorious moment when people look at these issues, but it is important to talk about what the government is doing,” Javid said on Marr’s program. “The government has taken a huge amount of action to try and deal with just this kind of problem.” The U.K. has closed more than 40 tax loopholes, signed information exchange deals with other countries and pressed for changes in international rules, Javid said, and that work needs to continue. The Google deal will help in the drive to change companies’ attitude to taxation, he said. “The way in which it was a success is that it helps change behavior,” he said. “It’s clear to me that when other companies look at this and they see that HMRC, no matter how long it takes, will not give up, they will come after you if they feel you’re not paying your fair share in taxes.”
Read more : bloomberg.com/news/articles/2016-01-31/google-defends-u-k-tax-accord-as-legal-not-sweetheart-deal-
Penetration (pen) testing is a valuable way to determine how resistant an organization’s digital infrastructure is to outsider attack. What better way to check a network’s security than giving scary-smart individuals permission to hack it. The authors of this SANS Institute paper about pen testing — Stephen Northcutt, Jerry Shenk, Dave Shackleford, Tim Rosenberg, Raul Siles, and Steve Mancini — make an interesting point, saying, “The main thing that separates a penetration tester from an attacker is permission. The penetration tester will have permission from the owner of the computing resources that are being tested.”
What exactly does permission mean?
Employing an outside party to attack an organization’s network while the organization continues normal operation is the only realistic way to test. However, it introduces certain challenges. Enough that Michael R. Overly, a Partner and Intellectual Property Lawyer with Foley and Lardner LLP, urges caution when negotiating the contract for a security audit involving pen testing. If you are wondering what a lawyer knows about pen testing, Overly is not your normal attorney. He has a slew of security certifications including CISA, CIPP, CISSP, ISSMP, and CRISC, has written about information security, and is recognized by peers for his information-security mettle.
Considerations for organizations requesting a pen test
Here are the precautions and considerations Overly suggests in this National Law Review post for companies seeking a security audit. The organization requesting a security audit should consider having the auditor represented by legal counsel: Doing so will afford the organization an opportunity to protect the audit and its results with attorney-client privilege and under the attorney work product doctrine. Overly also suggests, “Ask to review the report in draft form to make any changes before it is placed in the final form.” Treat the audit agreement as a professional services engagement: Ensure the work is clearly detailed in a well-drafted statement of work and that all costs are identified. Overly warns, “Beware of ‘scope creep’: new services that are added as the project progresses. Allowing creep may add significant costs and may not be protected by stipulations in the contract.” Think carefully before permitting unannounced penetration tests: At least some coordination should be given to ensure the operation of critical systems is not disrupted during key operating hours or month-end processing. Do not permit the audit agreement to create more risk than it is intended to resolve: This means ensuring the auditor assumes an appropriate level of responsibility. Overly offers the following reasons why this is important:
– Audit agreements normally do not include sufficient language regarding obligations of the pen tester concerning information security and confidentiality.
– The auditor will have access to sensitive data and details of how the organization secures its systems. That means strong security and confidentiality obligations, plus a level of liability that ensures the pen tester will comply with those obligations.
Overly further cautions, “Beware of auditors who are unwilling to provide reasonable protection for sensitive information.” Review language in the agreement permitting the auditor to remove data for off-site review: If such activity is permitted, the agreement should make clear the following:
-The data cannot be made available outside the country (unless specific controls are employed).
-The auditor cannot remove personally-identifiable data that may be subject to specific laws or regulations without first committing to be bound by those laws and regulations.
-The auditor cannot take possession of credit-card information unless there is an express need for possession, and the auditing company and or pen tester are fully compliant with the Payment Card Industry Data Security Standard.
Overly advises, “It is far better, however, to prohibit the pen tester from removing such data in the first place, given its sensitivity.”
Considerations for security auditors
Mark Rasch, in his SecurityCurrent column Legal Issues in Penetration Testing, looks at the implications a security auditor faces when performing a penetration test. First up, is recognizing that computer crime laws such as 18 USC 1030 come into play. Rasch writes, “18 USC 1030 makes it a crime to access or attempt to access a computer or computer network without authorization or in excess of authorization. What constitutes ‘authorization’ and who can authorize such access can quickly get muddy.” “So the lesson learned here is that penetration testing, even when authorized, can result in a host of legal trouble,” continues Rash. “The pen tester should obtain a ‘get out of jail free’ card from the customer, specifically indicating not only that the pen testing is authorized, but also indicating that the customer has the legal authority to authorize the pen test.” Rash offers the following suggestions of what else should be in the contract:
-Indicate what the auditor will do (and will not do) and the range of IP addresses, subnets, computers, networks, or devices that will be the subject of the pen test.
-If a software review is being asked for, ensure the copyright to the software permits reverse engineering or code review.
-If a pen tester is to test a network in the cloud, permission must be obtained from the cloud provider.
Rash spent considerable energy speaking to the likelihood of auditors bumping into sensitive data. “A successful pen test can result in the pen tester getting into a computer or computer network that they should not have had the ability to access,” he writes. “Also, it may include accessing data or databases that contain sensitive personal information, credit-card information, personally identifiable information (PII) or Private Health Information (PHI).”
Next, Rash introduces the following must ask questions when sensitive data is involved:
– Is the access to the information by the pen tester a “breach” of the database which must be reported?
– Must the pen tester sign a “Business Associate Agreement” agreeing to protect the data they just accessed?
During an email conversation, Overly brought up a not often thought about consequence regarding sensitive data. “The party conducting the test will gain highly sensitive information regarding the other party’s security measures,” he writes. “If that information were to be revealed to third parties, it could permit a hacker to compromise the tested systems.” Like most things, the actual work almost seems easier than all the paperwork and planning that must happen before a penetration test even begins. However, a well-worn cliche seems to apply here: “Better to be safe than sorry.”
Read More : techrepublic.com/article/dont-let-a-penetration-test-land-you-in-legal-hot-water/
As a media law scholar and practicing media lawyer, I field all manner of questions every week—from students, journalists, editors, and others. Whether I’m speaking generally to a non-client or giving specific legal advice to a client, I’ve noticed that the questions fall into three broad categories:
Can I use that? Can I say that? Can I do that?
Within each category, some issues come up more than others. They’re the greatest hits, so to speak, and I’m going to begin sampling that album with you here—starting with the category Can I use that? Future stories will explore the other two categories. Keep in mind that I’m a lawyer, not your lawyer (unless I actually am your lawyer), and these comments shouldn’t be construed as legal advice.
How to obtain a copyright
Can I use that? questions are typically copyright questions. First, freelancers want to know how to obtain a copyright in something they created. This is sort of the inverse of Can I use that? The person wants to know how to control the way others use her work. So, assuming a work is copyrightable in the first place (some things, like facts and short phrases, are not), it’s copyrighted upon creation. Generally, the copyright is owned by whoever created the work. But if it’s created in the course of employment, it’s usually considered a “work for hire” and owned by the employer. The New York Times, for example, owns the copyright in articles written by its employees. Among freelancers, copyright ownership depends on the rights articulated in their contracts. It’s not uncommon for freelancers and their publications to share copyrights in some way. Now, even though a work is copyrighted upon creation, it’s prudent for the owner to register the work with the US Copyright Office. Registration puts the world on notice of the copyright, and allows the owner to enforce the right in court. Plus, the federal copyright statute entitles the owner to statutory damages if she registers the work before infringement or within three months of the work’s publication. That’s helpful because it means the owner doesn’t have to prove actual losses in an enforcement suit. And, although this isn’t required to obtain a copyright, I usually advise my clients—especially the photojournalists—to place a copyright notice on each of their works. To be most effective, it should include the owner’s name, the year the work was created, and the copyright symbol. Why do I give that advice? If the client needs to enforce her copyright in court, notice takes away the defendant’s ability to claim that he innocently infringed, a defense that can mitigate the owner’s damages.
Lots of people ask me about fair use, the doctrine that allows you to use a copyrighted work without permission. First, understand that the goal of copyright law is not only to protect the rights of people who create content but also “to promote the progress of science and useful arts,” according to the Constitution. Allowing creators to enforce their copyrights in all cases would frustrate the latter, so the courts and Congress adopted the fair use doctrine to allow uses of copyrighted works that would benefit society. I spend my time in this area disabusing people of misconceptions—that you can sample up to 10 seconds of an audio recording, or copy up to three paragraphs of a book, or use whatever you want as long as it’s newsworthy or included in a news report. In reality, there are no such bright-line rules. To determine whether a use is fair, a court considers four factors. The first is the purpose and character of the use (chiefly whether it’s for criticism, comment, news reporting, teaching, or research, all of which favor fair use). The second is the nature of the copyrighted work itself (whether, say, it was unpublished, which is entitled to greater protection). The third is the amount and substantiality of the portion used in relation to the work as a whole (the more of the original work used, the more likely it’s an infringement). And the fourth is the effect of the use on the market for, or value of, the copyrighted work (uses that supplant the original work in the marketplace are unlikely to be fair). No single factor is determinative, and notably the fact that something is newsworthy, or used in a news report, does not automatically make its use fair. That’s probably where I spend the most time educating people. Using a copyrighted work for a news report will be considered as part of factor one, but that does not end the analysis—the court will go on to consider the other factors, and if they don’t favor fair use, then your use won’t be protected.
Linking and embedding
The last major Can I use that? issue is linking. As we surf the Web, we rely greatly on links to navigate from page to page—to look up related content. And news organizations increasingly are using links to provide access to their source material. But what if you post something that links to copyrighted or infringing content? Are you liable under prevailing copyright rules? Different types of linking present different copyright issues, and the law is not entirely settled here—so I’ll hit the two most important points that (for the most part) are settled. First, “deep linking” is what most of us think of when we think of linking. It means placing a link on your site that leads to a page on another site. Doing that, generally, does not constitute copyright infringement—even if the other site is hosting copyrighted or infringing content. Second, “inline linking” is what most of us call embedding. It means placing a line of HTML code in your site so it displays content directly from another site (e.g., embedding a tweet in a news story). That does not, generally, infringe any copyright because no copy of the embedded content has been made—the inline link is simply a piece of code that represents the content as it exists on the originating site. Moreover, most third-party platforms, like Twitter, include in their terms of service a provision that says the user permits others to embed his or her content. Which raises a related issue: Embedding copyrighted content may be okay, but screenshotting it and posting the screenshot is not. That’s basically the electronic equivalent of making a copy of the work, putting it squarely in the crosshairs of copyright law. So, if you find content on social media and want to use it (e.g., in an online news story), embedding is the safest way to do it—not screenshotting.
Read More : cjr.org/united_states_project/journalist_legal_questions.php
If computers replace human lawyers anytime soon, it is more likely to benefit politically conservative legal philosophies, such as the one embraced by Supreme Court Justice Antonin Scalia, than liberal philosophies – purely due to idiosyncrasies in the way the dominant technology works, a new paper argues. That’s one of the ideas put forward in a draft version of “Incomplete Innovation and the Premature Disruption of Legal Services,” written by Brian Sheppard, an associate professor at Seton Hall University School of Law. “My argument is that if lawyers are going to be replaced by computers … some of the more conservative [legal] theories may become more popular again because computers can do them quite well,” he said in an interview with Big Law Business. By legal philosophies or theories, Sheppard said he meant the different principles of adjudication that lawyers use when interpreting the law and the Constitution. His paper doesn’t identify any one philosophy with a political leaning, but Sheppard told Big Law Business that generally speaking, some conservative theories will likely be easier for computers to emulate because they are more black-and-white, with little subjectivity.
One of the best-known philosophies, Originalism, holds that the meaning of the U.S. Constitution was fixed at the time of its enactment, and is now closely identified with Scalia, Sheppard said. While it’s often viewed as conservative, it could also be viewed as a liberal bent under certain circumstances, he added. “There’s no philosophical reason why these theories are conservative,” Sheppard said, about Originalism, adding, “Liberals would love Originalism if the country had been on a steady conservative slide since the day it was founded.” The bulk of the paper is devoted to Sheppard’s theory that bespoke legal services — such as negotiation, the creation of high-stakes legal documents and advocacy — will be more scarce in the future as a result of what he calls “premature disruption,” caused by technological innovation, business model innovation or both. In explaining that theory, Sheppard devotes a chunk of his paper to “natural language processing,” the technology used in various artificial intelligence tools including Google, Apple’s Siri, and IBM’s Watson, and which he believes will play a critical role in any disruption that occurs.
Loosely defined, natural language processing is the interaction between computers and human language, such as a computer’s ability to conduct textual analysis or understand speech. A particular branch of this technology, called the syntactical approach, has progressed the furthest, according to Sheppard. Used in Siri and other products, the syntactical technique “is agnostic as to meaning; it essentially searches for matching sequences of characters and sorts based on distance between matching sequences within documents or based on match frequency,” the paper explains. Thus, it struggles with “elementary interpretative tasks,” but it can parse texts and extract meaning. He situates various legal philosophies along a curve based on how easily they can be emulated using syntactical natural language processing. At the bottom of the curve, the legal philosophy that could be most easily emulated with existing technology is Naïve Textualism, or the idea that statutes can be understood by looking up their words in a dictionary.
Further along the curve, already partially available for automation, Sheppard placed the legal philosophy known as Originalism, most famously embraced by Scalia, which holds that the U.S. Constitution’s meaning was fixed at the time it was enacted. To the extent that Originalism envisions the law as having a fixed meaning in the past, Originalism can be more easily automated, the paper states. But Originalism also calls for an understanding of “the intent” of the people who wrote the Constitution, and thus requires a computer to understand complex contextual dimensions, such as the “perceived problems, goals, hopes or ideals” of original legislators, which makes it difficult to fully automate with the current technology. Living Constitutionalism, which involves evaluating principles according to their practicality, how well they promote democratic legitimacy and the evolving values of the present time, sits at the highest spot on the curve and is the least computer-friendly, the paper states. Eventually, natural language processing could emulate such philosophies, with more gray areas, but that technology is still years, if not decades away from being deployable, according to Sheppard.
Close readers of News Hits are aware there’s a water tug-of-war going on. At its center is how to best address the problem of ratepayers who can’t afford to pay their bills. On one side is a majority of Detroit’s officials, who insist upon a get-tough policy of shutting off service, coupled with charitable contributions to help customers pay their bills. On the other side is a group of activists, politicians, and consultants who declare that an affordability plan would produce better outcomes for Detroiters, suburban ratepayers, and even the utility itself. It’s a subject that has cropped up in Detroit before. In 2006, Detroit City Council approved an affordability plan for the Department of Water & Sewerage. But the plan was never implemented, and several city officials now proclaim that any such plan would be illegal under state law. Earlier this year, Curt Guyette reported that DWSD Deputy Director Darryl Latimer had told him that state law “prohibits any kind of assistance plan that charges some customers less than the actual cost of service.” The same article mentioned that “DWSD attorney William Wolfson told the board he’s in possession of two legal opinions stating that an affordability plan isn’t allowed under current state law.”
That apparent sticking point came up again in an article in yesterday’s Detroit News, in which DWSD consultant Eric Rothstein said that water affordability plans ”aren’t currently legal in Michigan,” calling them “unconstitutional.”
The fine point of law seems to have gotten a reaction out of local blogger Nick Krieger. Krieger’s day job is as attorney with the Michigan Court of Appeals, but he also pens his own personal legal blog, Fix the Mitten. Yesterday, Krieger blogged about the claims that income-based affordability plans are illegal and unconstitutional and concluded that both statements are “misleading and probably incorrect.”
Michigan law provides that a municipal water supplier authorized to sell water beyond its territorial boundaries must charge customers who live outside the city “a rate which is based on the actual cost of service as determined under the utility basis of ratemaking.” … However, there is no comparable statue requiring a municipal water supplier to charge city residents a rate that is based on the actual cost of service. True, the Michigan Supreme Court has held in some cases that municipal utility rates which exceed the actual cost of service constitute a tax and violate a specific provision of the Headlee Amendment of the Michigan Constitution of 1963. But the Michigan Supreme Court has never struck down a municipal utility rate on the ground that it is less than the actual cost of service. Bear in mind that under an income-based payment plan established by the city of Detroit, the rate for out-of-city customers and non-indigent in-city customers would remain the same and would not increase. For example, out-of-city customers would still be charged a rate based on the actual cost of service. The only difference is that qualifying, indigent, in-city customers would be charged a lower rate based on their ability to pay. There is nothing unconstitutional or inherently illegal about such a system. Article 7, section 24 of the Michigan Constitution of 1963 states, “Subject to this constitution, any city or village may acquire, own or operate, within or without its corporate limits, public service facilities for supplying water, light, heat, power, sewage disposal and transportation to the municipality and the inhabitants thereof.” Furthermore, Article 7, section 34 provides that “[t]he provisions of this constitution and law concerning . . . cities and villages shall be liberally construed in their favor.” In the end, neither the Michigan Constitution nor Michigan statutory law appears to place any restriction on a city’s authority to set lower rates for resident water customers based on their ability to pay.
It’s a bit dry and drawn, but it’s about as strong an argument as we’ve heard that there is no prohibition on the progressive plan. When we spoke with economist and lawyer Roger Colton, he told us that such claims about affordability-based plans being illegal were an “excuse,” and added, “Rather than bemoaning the state law, they should start building the argument on why this fits within their traditional regulatory authority, and I think it does.” The question of the moment: Will Detroit could take a lesson from several other U.S. cities and their affordability plans, such as Chicago, St. Louis, Cleveland, and even Philadelphia, which recently approved an affordability plan for its ratepayers? Or will it continue to resort to a system that is ineffective, punitive, and expensive, based on unexamined claims that doing otherwise may be illegal?
Read more at : metrotimes.com/Blogs/archives/2015/09/03/legal-blogger-affordability-plan-for-detroit-water-doesnt-violate-state-law
North Carolina’s voter ID law may not go to trial after all, according to court documents filed Monday. The recent federal trial on North Carolina’s Voter Information Verification Act that ended about two weeks ago did not deal with the state’s photo ID requirement that goes into effect in 2016. It only dealt with other provisions of the law, which reduced the early voting period, eliminated same-day voter registration, prohibited county election officials from counting ballots cast in the wrong precinct but correct county, and abolished preregistration for 16- and 17-year-olds. U.S. District Judge Thomas Schroeder decided that the legal challenge to the photo ID requirement would be dealt with later. Schroeder’s decision came after state Republican legislators approved an amendment easing the photo ID requirement.
The amendment allows voters without photo ID to sign a declaration saying they had a “reasonable impediment” to getting a photo ID and also enables voters to use a photo ID that has expired as long as it has not been more than four years. State Republican leaders proposed the changes less than a month before the federal trial was to start. The N.C. NAACP, the U.S. Department of Justice and others charged that North Carolina’s law disproportionately damaged the ability of blacks, Hispanics, poor people and young people to register and vote. The federal trial that ended July 31 was closely watched because North Carolina passed one of the country’s most sweeping election changes soon after the U.S. Supreme Court invalidated Section 5 of the Voting Rights Act in June 2013. Section 5 of the Voting Rights Act required certain states and local communities, including in North Carolina, to seek federal approval for election changes in a process known as preclearance. In court papers filed Monday, attorneys representing the state NAACP and other plaintiffs said that their pending claims “may be able to be resolved through discussion and negotiations with Defendants.” The plaintiffs still believe the photo ID requirement is racially discriminatory and that state Republican leaders had discriminatory intent in passing the legislation, according to court documents.
They also said they have concerns about whether the state election officials have adequately educated the public about the new changes and whether county election officials have gotten the proper training. They also said state officials have not explained how exactly the new changes are going to be interpreted. The Rev. William Barber, president of the state NAACP, said Tuesday that attorneys are still examining the implications of the amended photo ID requirement and the legal options. Nothing has been settled, and plaintiffs said the changes may be even more confusing to people, he said. Barber said the amendment represents a 21st century literacy test because blacks are disproportionately more likely to be illiterate. Some might not be able to fully understand the “reasonable impediment declaration” they would have to sign if they don’t have a photo ID, Barber said. Literacy tests were used during the Jim Crow era to keep blacks from voting. Plaintiffs said in court papers that they plan to present a possible consent decree this week to defendants and raise areas of concerns “with the purpose of settlement discussions.”
“Plaintiffs believe that through a consent decree, Defendants may be able to provide the reassurances needed to resolve the pending claims without further court proceedings and reserve any remaining concerns in a different proceeding, if necessary,” they write in court documents. Attorneys for the plaintiffs said they would report back to Schroeder on Sept. 18. Thomas Farr, one of the lead attorneys for the state, did not return a message seeking comment. Attorneys representing the state and Gov. Pat McCrory filed court papers Monday, saying that the legal challenge to the photo ID law should be dismissed. They also argued that a decision by another federal appeals court striking down Texas’ voter ID law proposed something similar to the amendment that North Carolina passed. Plaintiffs said that’s a misreading of the ruling, which they argued left the ultimate decision on how to fix Texas’ Voter ID law to a lower federal court. Barber said Tuesday that Schroeder should not dismiss the legal challenge because even with the change, the law is still unconstitutional and racially discriminatory. “We’re still fighting and we’re winning,” he said. Schroeder has not issued a decision in the federal trial. He has said it would likely be weeks, and possibly months, before he issues a ruling.
Every weekend, Sydney Walters spends hours mowing the lawn, and cleaning up the yard of a home he owns but hasn’t lived in for years. His family fled the semi-detached home in Vaughan four years ago, when mould spread in his home due to the missing insulation in the attic. But he returns to the home every few days, to keep it looking habitable. “I don’t want it to look unkempt,” said Walters. “It’s a beautiful house from the outside, but inside it is hell.” The Vaughan resident says it breaks his heart when he sees the neighbours near his home on Hollywood Hill Circle sitting on their decks, enjoying the weather and holding barbecues with their families and friends.
“That should be me. That should be my family,” said Walters. “But instead, we are on the verge of losing everything.” For Walters, “everything” refers to the home he bought in 2004, in the hopes of giving his family a taste of the suburban dream. But it’s a dream that has become entangled in a web of lawsuits, that Walters says have brought him to the brink of bankruptcy and will soon cost him the only asset he has. In the meantime, Walters has been living in a cramped one-bedroom basement apartment a street away, with his wife and teenage son — who sleeps on the couch. The burden of paying for and running two households is proving to be just too much. “I’m still paying my mortgage, and we pay almost a thousand dollars to rent this,” said Walters, pointing at the small apartment around him. “Our monthly insurance fee is so high. It’s just a matter of time before the bank will take possession of the house,” he said.
The Star profiled Walters in 2012, when he was living in a tent in the backyard of his home because of the mould inside. He had just filed a lawsuit against the city of Vaughan, the builder Villa Royale Homes Inc., and Tarion Warranty Corporation — alleging the parties are responsible for the damage to his home as a result of the bare attic and should be responsible for the costs of the cleanup. In 2013, Walters initiated a new lawsuit against the parties, seeking $2 million in damages to their home and personal injuries. The lawsuit has sparked a handful of others, with the city suing the builder and the builder suing the city, the original homeowners and a subcontractor, who in turn sued the insulation company. With the agreement of all parties, the claims against Tarion and the insulation company were dropped after recent mediation. None of the allegations have been proven in court. Since then, the case has hit a standstill as nobody can agree on who is at fault. And each party Walters is suing says the other should pay, if a judge rules in his favour. Court mandated mediation failed in June. Walters’s lawyer, Wendy Greenspoon-Soer, says the case is headed to trial early next year.
According to the lawsuit, Walters and his wife Olivia bought the home in 2004 for $320,000 from the original homeowner, who bought the new build in 2002. As first time buyers, Walters admits he was naïve. Because it was only two years old, he moved in without a home inspection. He dutifully paid heating bills — upwards of $400 a month — even though he noticed the home was “extremely hot during summer months and extremely cold during the winter months, with poor ventilation and ice buildup where the walls meet the roof,” according to the suit.
In the winter, when he turned up the furnace, heat would escape through the top and melt the snow and cause leaks. In the summer, the house was hot, and the mould began to grow and spread because of the moisture. According to his claim, the family began to have health issues, and specialists and doctors advised Walters and his family to move elsewhere. Even now, he says he enters the home only if he’s wearing protective gear. Walters complained to the city after a contractor he hired said the attic lacked insulation. During legal examination in 2011, notes from a city of Vaughan building inspector confirmed that “no attic ceiling insulation” was ever installed.
As a result of the investigation, the city of Vaughan sent Walters and Villa Royale an order to complete the insulation in 2011. In a statement of defence, the city claims any damages should have been rectified by Walters, and that he has “exacerbated their own damages by suing Vaughan rather than fixing the problem.” They also say the damages were caused by the negligence of Villa Royale. Vaughan cites an independent contractor who said the cleanup and repair would cost around $15,000. In the reply to defence, Walters says his house will need to be completely demolished and rebuilt. He blames the builder for not installing the insulation and the city building inspector for failing to ensure it met the Ontario Building Code.
Neither Villa Royale nor its lawyer responded to a request for comment for this story. Last week, days after the Star started asking questions about the matter, Vaughan’s legal counsel sent Walters a settlement offer “to retain and pay a contractor to complete interior repairs to his home… including the installation of attic insulation.” Walters said he can’t comment on the offer. Since 2011, Walters says he has gathered documents that try to find answers to how his house was approved, if insulation was never installed. A city document Walters obtained through an Access to Information request show a city inspector approved the home, including its insulation, a day after the house was sold. Normally, a home must pass city inspection before it is cleared for sale. The city did not respond to questions about whether any internal investigation was conducted as a result of Walters’ 2011 complaint, as is required by the building inspector’s code of conduct protocol created in 2005. The city of Vaughan said it could not comment on the matter because it’s before the courts. “Our family, we are living in poverty. We are not poor. We are hard-working people, but we have no money. We go to bed hungry some nights,” said Walters, his eyes wet with tears. “We have a house, but we are living in these substandard conditions,” he said.
“That is just not right.”