13938 Holdings Corporation and Eddie Chiu

On August 31, 2011, pursuant to s. 28.3(1)(a) of the Homeowner Protection Act, (the “Act”) and s. 20.1(2)(b) of the Homeowner Protection Act Regulation, (the “Regulations”), 13938 Holdings Corporation (“13938 Corp”) and Eddie Chiu (“Chiu”) were issued a monetary penalty in the amount of $8,000. This monetary penalty was issued for the following reasons:

• 13938 Corp and Chiu, contrary to section 14 (1) of the Act, conducted the business of a residential builder regarding 5 multi-unit buildings, containing a total of 33 units, in Surrey, B.C., (the “Project”) during the period of September 30, 2010 and November 10, 2010, without holding a valid HPO Residential Builder Licence;
• 13938 Corp and Chiu, contrary to section 22 (1) of the Act, continued construction of units within the Project that were not covered by a policy of home warranty insurance, during the period August 12, 2010 and May 11, 2011;
• 13938 Corp and Chiu contrary to section 22(1.1) of the Act, sold 15 units within the Project that were not covered by a policy of home warranty insurance between the dates of November 2 and November 3, 2010 and November 30 and December 6, 2010;
• The contraventions of the Act by 13938 Corp and Chiu are the subject of Compliance Order 10-0034 (“CO”) issued by the Homeowner Protection Office (HPO) on December 23, 2010, and Amended Compliance Order 10-0043-1 (“ACO”) issued by the HPO on February 8, 2011. The date for complying with the CO was January 21, 2011 and the date for complying with the ACO was February 28, 2011;
• The CO and ACO directed 13938 Corp and Chiu to cease construction on any home not covered by a policy of home warranty insurance, ensure that all residential units contained within the Project, for which there is a conditional Purchase/Sale Agreement in place, are enrolled with and covered by home warranty insurance prior to those Purchase/Sale Agreements completing, ensure that the Project, including any residential units contained within the Project, is not offered for sale and/or sold, including transfer of legal title, until such time as they are enrolled with and covered by home warranty insurance, and ensure that all units contained in the Project are enrolled with and covered by home warranty insurance or ensure that a restrictive covenant is registered on the title to the property on which the Project is located restricting the sale or other disposition of any dwelling unit within each of five multi-unit buildings, for 10 years from the date of first occupancy of one of the dwelling units in each of the respective buildings; and
• 13938 Corp and Chiu failed to comply with the CO and the ACO by the requested compliance date.