OTTAWA -- A spat has erupted in Washington over a case involving a Canadian couple protected by diplomatic immunity and a damaged luxury townhome. Retired U.S. Foreign Service officers Eugene Tadie and Virginia Canil leased their northern Virginia three-storey brick home -- valued at about $700,000 US -- to the pair of diplomats posted at the Canadian embassy in D.C.

Upon their return, Canil said she was shocked to find excessive damage from leaks, drilled holes and cat urine stains. Major appliances were broken and corrosive spray had ruined brass items, she claimed.

"It was a mess," said Canil, who pegs total damages at about $20,000 US.

CLOAK OF IMMUNITY

But an infuriated Canil said the cloak of diplomatic immunity has helped prevent William Sheppit and Audrey Tomick from having to pay up.

"Diplomatic immunity is meant to protect diplomats from unfair prosecution, from being called spies and from being arrested," she said. "It is not meant to allow people to come in and break the law and trash people's houses."

But Terry Colli, a spokesman for the Canadian embassy in Washington, denied Sheppit and Tomick were invoking immunity and said the embassy has been "bending over backwards" to reach a reasonable resolution.

"The lawyers have made it clear that they have it (immunity) -- but then we engaged in an arbitration exercise to review the case," he said. "That arbiter concluded the damage was substantially less than the landlord was claiming."

TAXPAYERS' TAB

By the embassy's estimate, damages are about equal to a damage deposit of $4,250 US. Colli called the landlord's claims "frankly outrageous."

"They took a carpet they claim was damaged and replaced it with hardwood floors, which they expect Canadian taxpayers to pay for. They took a Corian counter that had a small hole drilled through and replaced it with granite. Tell me what's reasonable," he said.

Canil insisted her calculations are based on actual damages -- not on replacement value. But she said she'll probably never recoup the cash, pointing to a letter she received from Canadian embassy lawyer Edward Wilson reminding that diplomats are immune from criminal prosecution and civil liability.