That is up to code. A white wire after the panel can be used as an identified wire to a switch. Down on white, back on black. Any electrician would know this going into a switch box, or a fixture box. Sounds like it was done correctly to me. Rest easy.
If you took a look at the photograph, you would see that they put a black tape onto the white line to signify that it is being used as a hot line.
According to my conversations with the ESA who happen to set the standards here in Ontario, the whole of the exposed wire needs to be actually covered, not just a small band.
As for red wire being used for 240v. That is not true. If you were to run a 3 way light switch, then you would most likely use 14/3 wire that has 1 white, 1 black and 1 red wire + ground. The red wire would be used in the 120v circuit.
The 3 way switch toggles what line it sends the voltage down, so it could be the black is hot, or it could be the red depending on what side the switch is on. As you put 2 of these switched on the same circuit, it allows the light to be controlled from two different locations. So RED does not mean 240, it means it can be a hot line.
Now the ESA has told me that they will accept either a hot line to be red or back, and if you are using a white cable, then the whole of the exposed cable needs to be covered. In my case, the contractor didn't. I get the distinct feeling that is was not done by a qualified electrician as there was NO ESA tag on the electrical panel with the ESA tag number for the job. Any electrician would by default pull an ESA tag because not doing to could result in loosing his license.
Sorry if I come across as tarring all contractors. I know there are many that do an exceptional job. The one that did this basement didn't. Just like the contractor who originally built the house didn't go a very good job either. Things like double studs at the doors. Putting a ground wire onto electrical plugs to the metal box. Not having exposed wires when using the stab points on an electrical outlet. Small details that should have been caught but weren't.
But as you said Bob.. The owner before me probably went with the lesser price and didn't know enough to know it was done wrong. So I vent my frustration that some people out there don't take enough pride in their work to do it right and pray on the ignorance of others by cutting corners. To justify it by saying that they charged less so what did the customer expect is a bit of a crock. it's like GM saying that the customer should have known better in buying their cars with a faulty ignition switch rather than paying more and getting a mercedes benz. They paid less so why should they expect to get something that works properly and not kill them.
