Grievance Case Summary - G-205

A member who was to be transferred to another division sought approval under the RCMP's Home Equity Assistance Plan (HEAP) because he anticipated losing money on the sale of his house. He sought to include in the calculation of the purchase price the cost of the renovations he had made to the house. He was denied coverage under HEAP, as the Appropriate Officer determined that his sale price had not been lower than his purchase price; the Appropriate Officer allowed some of the member's renovations to be included in the purchase price, but disallowed others. The Appropriate Officer also found that the calculation of the purchase price could not include the value of a piece of land that was attached to the house lot. The member submitted a grievance against the decision, seeking inclusion of all of his renovation costs and challenging the exclusion of the value of the additional land from the purchase price.

An informal resolution of the issue regarding the additional land was reached, resulting in a decision that the member did qualify for HEAP. However, the member continued his grievance on the issue of the inclusion in his purchase price of his cost for the installation of carpet and hardwood flooring, which had been disallowed by the Appropriate Officer. The Grievance Advisory Board (GAB) recommended that the grievance be denied, as it found that the flooring renovation could not be included in the purchase price for the house; it stated that the list of allowable improvements in the definition of purchase price in the policy on HEAP was exhaustive, and flooring renovations were not on the list. The Level I adjudicator agreed and denied the grievance. The member sought Level II determination of the grievance.

On January 22, 1998, the ERC issued its findings and recommendations. The Committee examined the definition of purchase price in the policy, and reiterated its view that the lower of cost or added value of basic renovations which are necessary to the integrity or livability of a residence should qualify for inclusion in the purchase price under HEAP, as long as they are not expenditures which maintain the value of the residence. In this case, the entire house had been covered in commercial linoleum tile flooring of a nature commonly found in hospitals and schools; the Committee found that to remove this kind of flooring and replace it with residential flooring was a matter related to the livability of the house, and was reasonable in the circumstances. There was no argument by the Appropriate Officer that the flooring materials used by the member were extravagant or were beyond what would constitute reasonable residential flooring materials; the Level I adjudicator had accepted that the flooring installed was in accordance with the norms and standards of the community. The Committee found that the flooring renovation had not been a value-retentive or maintenance expense, but had added value to the residence; the Committee therefore recommended that the value added to the house by the flooring renovation be included in the member's purchase price, and that the Commissioner allow the grievance.

On June 9, 1998, the Commissioner rendered his decision. The Commissioner denied the grievance because he disagreed with the Committee's interpretation with respect to the calculation of the purchase price for the purposes of HEAP. He also disagreed with the Committee's findings in this particular matter.