Penticton contractor facing lawsuits in the millions ordered to pay building supplier, mortgage

A Penticton-based construction company facing countless legal battles has recently been ordered to pay up close to $3 million for the owner’s mortgage and building materials.

Okanagan Extreme Home Builders (OEHB) and its owner Jason Stutzke have been served with continuous lawsuits over the past year and have 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.

Contractors have claimed being left completely unpaid for projects, while some homeowners reporting 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.

Homeowner frustrated by bills

Another homeowner has come forward to Castanet News after building their retirement property in Penticton with OEHB, only to be left dealing with claims of unpaid bills from contractors and liens placed on their property.

Leana Trogi and Peter Hamilton contracted OEHB in April 2021 to build a house in the Skaha bluffs.

“We paid all the draws to OEHB per our contract, on time regardless of the never-ending delays that were preventing our home from being built in a timely manner. Our payments included paying cash for the invoice we received in July, for extras which included our upgrade to a heat pump system and hot water on demand,” the couple shared in a written statement.

“We finally moved into the house in November of 2023 after an insane amount of stress and excessive delays.”

In December of 2023, a lien was placed on the house by Canadian Aerothermal, alleging that they were still owed $36,000. Home Hardware placed another lien on their home in January of 2024, for a total of $50,000 owed.

The couple said they didn’t find out about the Home Hardware claim until they were mailed formal notice of pending litigation in April 2024.

“We were not served at the time, however, the shock of finding out that Home Hardware is after us for $53,000 was horrifying, to say the least.”

The couple also said that at the end of October 2024, they received a demand letter from a lawyer representing Canadian Aerothermal stating that they were expecting payment of $36,000 and then they would remove their lien, which expires in December of 2024.

“We declined and retained legal counsel,” the couple added.

Trogi said what truly is frustrating for them is to see the mounting lawsuits, claims and liens placed on homes throughout the Okanagan Valley by these companies.

“How is it that we paid OEHB $36,000 for Canadian Aerothermal to provide and install our HVAC back in July 2021, and in spite of not being paid by OEHB, they continued to supply and install HVAC systems?” she alleged.

“Why would they continue to extend any credit to OEHB? So, given that we have paid all of our invoices, they feel that they can threaten the Lien Act however they are making an end run outside of the court system to demand we pay cash now?”

“We are pensioners. We are not wealthy but have saved through our hard work for just a house.”

They feel the current law system and provincial lien system are “completely broken.”

“It has the capability to have people lose their homes and livelihood.”

Castanet reached out to Home Hardware, also known as Pro Builders Supply, and Canadian Aerothermal for comment on the status of their working relationship with the OEHB and if the issues of non-payment have resulted in changes to that.

The CFO for Pro Builders Supply told Castanet in an emailed statement that the company does not comment on pending or ongoing litigation.

“That said, any lien placed on a property in favour of the company is done so in full accordance with the British Columbia Builders Lien Act. No further comment on this matter.”

Canadian Aerothermal did not reply to Castanet’s request for comment.

Building supplier owed costs

Penticton Home Hardware Building Centre has made progress against OEHB and Stutzke, with the court ruling that they were to be paid $403,027 at the end of October, plus $18,304 in interest and $1,270 in costs.

The court determined that with no response filed by OEHB or Stutzke, the default judgment was to be ordered.

The company first filed a claim against Stutzke back in January, starting with an estimated $166,000 owed for construction materials.

They filed a new notice of civil claim in July, alleging that as of June 20, 2024, OEHB owed them $403,027 for construction materials supplied to them, which includes interest totalling $58,953.

In October, 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 specific claim has not yet been filed in court.

Time to pay up

The Cambridge Mortgage Investment Corporation will get their dues, after serving Stutzke with a foreclosure petition, following a claim that he defaulted on his mortgage with them earlier this year.

The petition was filed back in June, and sought 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 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.

At the end of October, the court ruled that the mortgage had defaulted and Stutzke would have to pay up the $2.389 million he owes, plus interest, before April 24, 2025.

Court records from April show that Stutzke had been served with a foreclosure petition from another company, having allegedly defaulted on his mortgage with them as well.

The petition ordered that the lands and any personal property of Stutzke and OEHB be listed for sale by their own conduct, as he owes more than $2.5 million, plus accruing interests.

Local contractor out funds

A lawsuit was filed by a local drywall work and services company from Kelowna, Lesperance Interiors, at the end of September, alleging that OEHB had refused or neglected to make payments, despite demand, and they are owed $33,505 for their work and materials.

The company spoke with Castanet earlier this year, claiming 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.

Lesperance stated that the main building contract was "abandoned or terminated."

OEHB filed a reply on Oct. 16, claiming that Lesperance Interiors invoiced the company three weeks before finishing the job, contrary to their terms of agreement.

They also claim that the invoice should has been submitted after the subcontract had been terminated.

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, and has not received a reply.

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 has to pay the costs of the appearance on that date of $350 to Finish First. Then on Oct. 8, a default order was submitted.

Since then, OEHB has filed supporting materials in its case and a default hearing is scheduled for Dec. 2.

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

TwinCon Enterprises filed a suit against Stutzke back in March, which included naming the owners of the land of six properties in Penticton they allegedly worked on, seeking money owed.

A few of the homeowners filed responses earlier this year, claiming that they were issued “extra invoices” by OEHB, which equal the claim amount against them from TwinCon. Further responses on this case have not yet been filed.

Naramata homeowners have filed against Stutzke and OEHB are seeking judgment in favour of the liquidated amount of $135,318 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.

In the middle of May, Stutzke filed a lawsuit against Timeless Developments, claiming work done by the company on his home’s pool was poor and had to be fixed. He was seeking relief for damages, interest, costs and lost rental income.

With no reply filed by Timeless Developments, Stutzke went on to file for default judgement and requisition in August and is having the damage assessed.

A payment dispute between Stutzke and a Penticton homeowner, Randall Browning, continues to be battled out in civil court filings, through counterclaims and replies.

Browning filed an updated counterclaim in June, alleging unjust enrichment and claiming that Stutzke overcharged him and took deposits for work that was never completed.

Then on Nov. 21, Browning filed a notice of application to the courts, requesting to address a judge in December and have the certificate of ending litigation, as well as the liens against his property cancelled.

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.