# 2020-139 Pay and Benefits, Home Equity Assistance Program

Case summary

F&R Date: 2020-12-11

The grievor relocated from Cold Lake in July 2015. In September 2016, the grievor entered into an agreement for the sale of his home in Cold Lake with a closing date in October 2016, resulting in a $90,000 equity loss. On 14 May 2018, the Treasury Board Secretariat (TBS) declared Cold Lake to be a depressed housing market for various quarterly-periods between April 2016 and July 2017 depending on the date of possession of the home for the purpose of 100% Home Equity Assistance (HEA) reimbursement under the Canadian Forces Integrated Relocation Program (CFIRP) Directive. According to the TBS, homes sold in the July-September 2016 timeframe would qualify for 100% HEA reimbursement, while homes sold in the October-December 2016 timeframe would not. The Director Compensation and Benefits Administration (DCBA) determined that the closing date of the grievor's home was the determinative date for the sale of his home and denied 100% HEA reimbursement.

The grievor argued that the purchase agreement is a legal and binding document with respect to the agreed upon purchase price, and so the date he entered into this agreement should be the defining date for the sale of his home.

The Initial Authority (IA), the Director General Compensation and Benefits, found that the grievor's closing date fell outside the TBS established depressed market timeframe. Therefore, the IA found that the grievor did not meet the criteria to receive 100% HEA reimbursement and denied redress.

The Committee considered the definition of “sale date” for the purpose of entitlement to the HEA benefit in the CFIRP Directive. The Committee found that the TBS has not specified which date would determine when a home has been “sold” in order to qualify for sale within a depressed market. The Committee then considered that the real estate purchase agreement binds the grievor to the obligations contained within the document as of the date that the grievor signed, and that the decision to sign the document was based on the market conditions that existed at that time and not as of the closing date. The Committee concluded that the closing date was simply the administrative follow-through of the purchase agreement and that the signing date of the purchase agreement should be the determining date of sale for the purpose of the HEA benefit. The Committee found that the grievor's September 2016 sale date fell within the TBS approved July-September 2016 timeframe to qualify for 100% HEA reimbursement. The Committee therefore recommended the approval of 100% HEA reimbursement of the grievor's lost equity for his sale in a TBS designated depressed housing market.

The Committee also considered an alternate analysis in the event that its sale date finding was not accepted by the Final Authority (FA). In that regard, the Committee referred to an interview given by the Director Compensation and Benefits Administration (DCBA) to the Canadian Broadcasting Corporation in May 2018, where the DCBA stated that the intent of the Canadian Armed Forces (CAF) was to address catastrophic home equity losses using a “caveat” found in the CFIRP. DCBA staff advised the Committee that the “caveat” was CFIRP, article 2.1.01. The Committee then found that article 2.1.01 applied to the grievor in that his issue was directly related to his relocation and the extent of his equity loss was exceptional in nature. As an alternative to the Committee's first recommendation, the Committee recommended that the FA direct DCBA to forward the grievor's claim for full reimbursement of his equity loss to the TBS with the full support of the CAF.