Penticton contractor facing claims in the millions continues to see lawsuits for alleged unpaid bills

A Penticton-based construction company already in hot water with numerous legal battles continues to see claims levied against it.

Okanagan Extreme Home Builders (OEHB) and its owner Jason Stutzke has been served with continuous lawsuits throughout 2024 and has already been ordered to pay some debt claims against them. The company owner has been alleged to have misappropriated funds to pay for the construction of his own home.

Local contractors have claimed being left completely unpaid for projects, while some homeowners report facing liens on their homes.

Stutzke had been served with a foreclosure petition filed by multiple companies, having allegedly defaulted on his mortgage.

Castanet first reported on the legal predicament in January. Since then, the number of alleged unpaid claims has mounted, and they are nearing an estimated $9 million.

Local company wants payment

A lawsuit was filed by a local drywall work and services company from Kelowna at the end of September, Lesperance Interiors, claiming they owed for work done on a property after being contracted by OEHB.

The company spoke with Castanet earlier this year, wherein claimed that they entered into an agreement with OEHB where they agreed to provide drywall work and services for a home both in writing and through a verbal contract.

In the lawsuit, they alleged that OEHB had refused or neglected to make payments, despite demand, and they are owed $33,505 for their work and materials.

Lesperance stated there was a claim of lien placed on the home on May 30, 2024, and claimed that the day before, the main building contract was "abandoned or terminated."

The lawsuit was filed on Sept. 23 and a reply to this claim has not yet been filed in court.

Building supplier losing out

Another lawsuit was filed in B.C. Supreme Court in Penticton this week by Penticton Home Hardware Building Centre against OEHB and Stutzke.

The company first filed a claim against Stutzke back in January, alleging he owes an estimated $166,000 for construction materials, which has not received a reply or filed an update.

They filed a new notice of civil claim in July, alleging that as of June 20, 2024, OEHB owes $403,027.74 for construction materials supplied to them, which includes interest totalling $58,953.44.

They are seeking judgment against Stutzke for the more than $400K owed plus costs to the court.

On Wednesday, the company filed another lawsuit claiming that they entered into an agreement with OEHB where they agreed to provide construction materials for various construction projects on May 20, 2021.

This time, they claim construction materials were taken under the supply agreement for three different building lots and have not been paid for, in the amounts of $22,624.25, $65,866.72 and $73,254.13.

A reply to this claim has not yet been filed in court.

Mortgage default heads to court

The Cambridge Mortgage Investment Corporation served Stutzke with a foreclosure petition, claiming he defaulted on his mortgage with them earlier this year.

The petition, filed on June 25, is seeking an order that the lands and any personal property of Stutzke be listed for sale by their own conduct.

According to the petition, demand has been made for the payment of the money owing, but this money has not been paid and to date totals more than $2.26 million, plus interest.

The petition claims Stutzke has been in default since April 2024, and a letter sent on May 7, 2024, demanding payment from Stutzke, allegedly went unanswered.

In August, Stutzke filed a reply to the petition, arguing that the fair market value of his property exceeds the outstanding amount of his mortgage and claiming that an appraisal report from May of 2024 assessed the value of the property at Garnet Way at $8.6 million.

“To date, the outstanding balance of mortgage debt charged to the lands, including the amount due to the petitioner, totals approximately $4,852,852,34 plus interest,” the reply reads.

These two parties will meet in court at the end of October for a hearing.

Lawsuits go both ways

Midway through September, Stutzke filed a civil claim against a group of property owners, who he had entered into a contract with to construct a home in Penticton in 2022.

Stutzke claims that there was a fallout between the parties in early 2024 when they halted his work on the property and prevented his workers from attending the property to finish the job or retrieve their materials.

He alleges that the fallout was from builder liens being placed on the property due to material suppliers and subcontractors not being paid, but that the owners were partially responsible since they consistently paid late.

Stutzke is seeking $133,979 plus interest for damages from the breach of contract and is seeking an order to access the property to retrieve equipment and materials.

He also wants the property owners to produce their own building permit, home warrant and workman’s compensation board coverage, instead of using the ones he obtained.

The owners filed a reply to the claim on Oct.1, denying many of Stutzke’s allegations and stating that OEHB did not attend to the timelines agreed upon.

They allege that OEHB did not pay its material suppliers, which caused the lien on their property, and no payments were in arrears or late or delivered upon material and services, and are not indebted in any manner.

They also deny that any of OEHB’s material remains on the property.

The owners claim that the liens and failures of the company, coupled with other breaches, entitled them to legally terminate the agreement.

The owners claim that they paid a deposit for the execution of the agreement during the fall of 2022, but work did not commence until May 2023.

Delays continued. The owners alleged to have found that the liens placed on their property by other businesses caused a default on their mortgage terms and they had to, in turn, settle the amounts with the suppliers directly.

“As the defendant's lender had various other loans in distress because of [OEHB’s] non-payment of supplier accounts and liens against other properties, it was a condition of the defendant's lenders to maintain the loan related to the property [OEHB] was not allowed to continue as the contractor for the build on the property,” the response claim reads.

The owners claim an amount of $75 is all that is due to OEHB, which they are willing to settle.

The property owners also filed a counterclaim, alleging loss of equity in the property, loss of potential rental income and additional mortgage costs, totalling close to $120K, which they are seeking payment for including damages.

Ongoing cases

Burnco filed a suit against Stutzke in March, which included naming the owners of the land of nine properties they allegedly supplied materials for, seeking money owed. They claimed they are owed roughly $29,200 from six properties, plus potentially more due to contractual interest and solicitor and client costs.

Burnco filed a notice of discontinuance in July for AMB Holdings and three of the homeowners.

A lawsuit filed by Finish First Interiors, which claims Stutzke and OEHB have a balance owing on an account for residential drywall and finishing work done in Penticton in December of 2022, has moved into the courts.

Finish First Interiors is seeking the balance owed for their completed work, which they say was invoiced at $20,509.50. They claim that OEHB paid $6548.25 towards total debt, leaving $14,042.25 owing to Finish First, which allegedly amounts to $15,011 including interest.

They also claim OEHB has been paid by the property owner for its work.

The court ordered that Stutzke must attend court on Sept. 16 and OEHB his to pay the costs of the appearance on that date of $350 to Finish First. Then on Oct. 8, a default order was submitted.

A claim submitted by AMB Holdings and Panorama View Estates allege they are owed more than $2.7 million from OEHB has yet to receive a reply.

Naramata homeowners have filed against Stutzke and OEHB are seeking judgment in favour of the liquidated amount of $135,317.70 on account of the deposit, general damages, tracing to or disgorgement of the deposit, and a declaration that the Claim of Lien is an abuse of process, have yet to receive a reply.

None of the allegations in the lawsuits have yet been proven in court, and all named parties have a right to respond with countersuits should they choose to do so.