Alan Webster v. City of Kawartha Lakes, 2012 ONAFRAAT 5

Agriculture, Food and Rural Affairs Appeal Tribunal 1 Stone Road West

Tribunal d’appel de l’agriculture, de l’alimentation et des affaires rurales 1 Stone Road West

Guelph, (Ontario) N1G 4Y2 Tel: (519) 826-3433, Fax: (519) 826-4232 Email: AFRAAT@ontario.ca

Guelph (Ontario) N1G 4Y2 Tél.: (519) 826-3433, Téléc.: (519) 826-4232 Email: AFRAAT@ontario.ca

AGRICULTURE, FOOD AND RURAL AFFAIRS APPEAL TRIBUNAL

APPEAL:

Short & No. 2A Drain 2006 City of Kawartha Lakes

Short & No. 2A Drain 2006 (RE) [Costs of Motion] [Request for Review] 2012 ONAFRAAT 5

STATUTE:

Drainage Act

HEARING:

DATE OF DECISION:

March 27, 2012

2012-05

NEUTRAL CITATION:

2012 ONAFRAAT 5

Short & No. 2A Drain 2006 [Costs of Motion] [Request for Review]

City of Kawartha Lakes

IN THE MATTER OF THE DRAINAGE ACT, R.S.O. 1990, CHAPTER D.17, AS AMENDED.

AND IN THE MATTER OF: An Appeal to the Agriculture, Food and Rural Affairs Appeal Tribunal by Alan Webster of Thornhill, Ontario under Subsection 48(1) of the Drainage Act from the Engineer’s report on the Short and No. 2A Drain, 2006 in the City of Kawartha Lakes.

AND IN THE MATTER OF: A decision by the Tribunal dated December 14, 2011 ordering costs to be paid by Alan Webster;

AND IN THE MATTER OF: A request for review by the Alan Webster of the Decision of the Tribunal dated December 14, 2011 under Subsection 21.2(1) of the Statutory Powers Procedure Act and Rule 29 of the Rules of Procedure for the Tribunal.

Before: Harold McNeely, Vice Chair

DECISION OF THE TRIBUNAL

Background to the Review Request

The Applicant, Alan Webster “Webster”, seeks a review by the Tribunal of the Costs of Motion Decision dated December 14, 2011 issued by Vice Chair John O’Kane holding Webster responsible to pay the sum of $7,080.70 to the City of Kawartha Lakes “the City”.

The history of the Short & No. 2A Drain is summarized in Vice Chair O’Kane’s decision dated September 1, 2011 in which he dismissed the City’s motion to strike Webster’s appeal under Section 48 of the Drainage Act. In a hearing before the Tribunal conducted on August 23, 2011, the City had brought a motion to dismiss the appeals of several property owners, including Webster’s appeal on the grounds that the appeals were frivolous and vexatious. Several landowners/appellants withdrew their appeals before the hearing, leaving Webster and three other landowners as appellants before the Tribunal. The Tribunal dismissed the City’s motion as it relates to the appeal of Webster and two other landowners, and issued case management directions to provide the procedural framework for the Tribunal to exercise its authority to control its own process as is allowed by Section 23 of the Statutory Powers Procedure Act “SPPA” and the Tribunal’s Rules of Procedure.

The following are the paragraphs of the order of the Tribunal dated September 1, 2011 setting out the case management directions:

3. Daniel B. Ellis, Nigel Mole and Alan Webster are hereby ordered as follows:

a. Within twenty days from the date of the release of this decision, the

appellants shall deliver to the Clerk the following:

i. Full written particulars of the appellants’ section 48 appeals, in accordance with Rule 19;

ii. A list of all documents and things the appellants intend to use as evidence at the hearing, in accordance with Rule 20;

iii. A list of all witnesses the appellants intend to call to testify and copies of witness statements, in accordance with Rule 21.

b. The appellants’ materials delivered to the Clerk under paragraph 3 a. should include, but not be limited to, the following:

i. Specific details, information and documents supporting any assertion that the benefits of the drainage works in the Report are not commensurate with the estimated costs;

ii. Specific details, information and documents about how and why the drainage works in the Report should be modified;

iii. Specific details, information and documents about why the allowances and compensation in the Report are inappropriate and what those allowances and compensation should be and why;

iv. A detailed list of all documents and things the appellants intend to refer to in evidence at the appeal hearing;

v. A signed witness statement from every witness the appellants intend to call at the hearing setting out, in addition to those things required by Rule 21, the substance of the evidence the witness will give at the appeal hearing;

vi. A list of all professional or expert witnesses that the appellants intend to call to testify at the appeal hearing, including the professional’s or expert’s area of expertise;

vii. Copies of the qualifications of all professional or expert witnesses the appellants intend to call at the hearing;

viii. Copies of all reports received by the appellants from any professional or expert witness.

In his decision, Vice Chair O’Kane had also ruled that “as part of these directions, I specifically reserve the City’s right to bring a similar motion to dismiss the remaining Section 48 appeals, in the event the appellants fail to abide by the directions ordered below”.

While the City had sought costs in the amount of $7,500.00 on the motion to dismiss, Vice Chair O’Kane refused to grant such cost given the divided results on the hearing of the motion.

Motion by City to Dismiss Webster Appeal

In response to the directions given in the Tribunal’s order of September 1, 2011 Webster filed, on September 29, 2011, a four-page handwritten letter and an attachment consisting of a letter from Mike Fudge Construction dated September 26, 2011. This document was sent by Webster directly to the Tribunal instead of the Clerk of the City as directed by the Tribunal’s procedural order.

On September 22, 2011, the day after the deadline for Webster to file material as directed in the procedural order, the City sought a hearing date for a motion to dismiss Webster’s appeal for failure to provide the information and documents set out in the Tribunal Order.

As noted by Vice Chair O’Kane in his reasons of November 28, 2011, the Tribunal office had received a partial transmission from Webster on September 29, 2011. Only seven of ten pages had been received via facsimile transmission, and the Tribunal Coordinator attempted to reach Webster by telephone at his office on September 29, 2011. She left a message concerning this partial transmission. Webster did not respond to this message from the Tribunal Coordinator. Webster’s response to the procedural directions was received by the Clerk of the City on October 13, 2011 in an envelope post-marked October 5, 2011. In analyzing Webster’s attempt to comply with the procedural order, Vice Chair O’Kane concluded that Webster showed “a cavalier attitude worthy of censure”. He also concluded that Webster’s explanation, that he read the procedural directions as giving him to the end of September to file particulars, lacked credibility, given Webster’s background as a Chartered Accountant, a Vice-President of Finance of a Company in the Greater Toronto Area and his substantial land ownership consisting of some twenty farms in the County of Victoria. Following Vice Chair O’Kane’s comments that Webster’s conduct in complying with the procedural order was worthy of censure, he invited the parties to make submissions as to costs. He also proceeded to dismiss the City’s second motion to have the Webster Section 48 appeal dismissed as frivolous and vexatious. In applying the tests in Her Majesty the Queen in Right of Ontario v. Rui Bin Xu 2011 (ONSC2315 II), he determined that he could not conclude that it was obvious that Webster’s appeal was not capable of success, or that his appeal was not such that no reasonable person can reasonably expect to obtain relief, and he could not conclude that the action was brought for an improper purpose…or for purposes other than assertion of legitimate rights. He went on to state that he was ruling in Webster’s favour on the second branch of the Rui Bin Xiu decision only by the “slimmest of margins”.

Costs of Motion Decision - December 14, 2011

Following submissions by Webster and the City on the City’s request for costs, following a review of Section 98 (10) and (11) of the Drainage Act, Section 17.1, Section 25.1 of the SPPA, as well as Rule 28 of the Tribunal’s Rules of Procedure, Vice Chair O’Kane stated as follows:

In my view, it was clearly unreasonable for Alan Webster to fail to comply with the procedural directions set out in my September 1^st Order. As noted above, that failure resulted in the unnecessary costs of the dismissal motion. Because those costs were unnecessary, I find that they resulted in undue prejudice to the City of Kawartha Lakes.

Vice Chair O’Kane then reviewed each party’s submissions as to costs. He allowed the City’s claim for the preparation for the motion to dismiss in a total amount of 21.5 hours at an hourly rate of $225.00 per hour, an amount which he concluded was reasonable for Counsel, considering her years of experience and her expertise in the area of law, and reduced the claim for the preparation of the submissions for costs to 4 hours from the 8 hours claimed. The disbursements claimed at $528.00 were allowed together with the H.S.T. in the amount of $814.59. Accordingly, the total costs awarded against Webster stand at $7,080.70.

Reasons for Requesting the Review

Webster provided the following reasons for requesting this review:

1. The costs awarded were excessive.

2. Rule 15.07 of the Small Claims Court Rules provides that costs on a motion exclusive of disbursements should not exceed $100.00

3. Since the costs of the Tribunal are enforceable under the Small Claims Court jurisdiction, in accordance with Section 98(10) of the Drainage Act, the award by the Vice Chair should therefore conform with the Small Claims Court scale for costs of motions.

4. The following principles should govern in exercising discretion to award costs following a hearing:

a) The results in the proceeding;

b) The amounts involved in the claim or the amounts recovered;

c) The importance of the issues;

d) The complexity of the proceedings;

e) The conduct of any party tending to shorten or unnecessarily lengthen the

proceedings; and

f) Any other matter relevant to the question of costs.

5. The City was unsuccessful in its motion to dismiss.

6. The City failed to serve the Solicitor who had launched the appeal for 38 affected landowners. Therefore, Webster did not have legal representation at the August 23, 2011 hearing.

7. He only received a letter from Paul Courey, a lawyer representing many affected landowners in proceedings before the Drainage Referee, on December 23, 2011. In this letter, Mr. Courey summarized appeal activity before the Referee, and this information was not available to submit to the Tribunal as part of Webster’s costs of motion submission.

8. The delay in filing his answer within the procedural order timeframe was caused by a delay in obtaining a letter from Mike Fudge Construction.

9. The late filing should be considered a technical breach of rules or procedure.

10. There was no delay caused in the advancement of the appeal by filing documents later than the specified date.

Review Findings

1. The costs were excessive

The City’s costs were analyzed by Vice Chair O’Kane and adjusted where appropriate. In doing so, Vice Chair O’Kane applied the principles followed by Judges and other judicial officers in fixing or assessing the costs of litigants. As stated by Orkin, in Law of Costs, Second Edition, page 7-7 and referring to the case of Zesta Engineering v. Cloutier (2002, 2002 CanLII 25577 (ON CA), 21 C.C.E.L. (3d) 161(C.A.) “The principle enunciated in Zesta that the court must arrive at a result that is fair and reasonable has been called a fundamental concept in fixing or assessing costs”. It goes on to state that “it follows that judges when fixing costs, must continue to consider as relevant factors, the experience of the lawyers, the rates charged and the hours spent; an hours and rates calculation will still be performed and serve as a guideline for allowable costs.” In exercising his discretion, Vice Chair O’Kane, followed these principles. I can therefore find no basis to review Vice Chair O’Kane’s decision based on this submission.

2 & 3. The application of Rule 15.07 of the Small Claims Court Rules and Section 98

(10) of the Drainage Act

The Costs award was made pursuant to Section 98(10) of the Drainage Act. Section 98 (10) provides a mechanism to enforce cost orders of the Tribunal by filling these in the Small Claims Court. It does not adopt the scale of costs set out in the Small Claims Court Rules. The monetary jurisdiction of the Small Claims Court is $25,000.00 whereas the total estimate of drainage works for the municipal drain in question is $965,000.00. This amount is more in keeping with monetary claims which fall within the jurisdiction of the Superior Court of Justice of Ontario. In the circumstances, it is more appropriate for the Tribunal in this case, to apply by analogy, the principles and tariffs which apply to proceedings in the Superior Court of Justice of Ontario. Vice Chair O’Kane having applied these principles, I can find no basis to review his decision on costs based on these submissions.

4 & 5. Principles which govern in exercising discretion and awarding costs / The

City was unsuccessful in its motion to dismiss

As stated by Orkin at page 2-63 of Law of Costs, “The principle that a successful party is entitled to his or her cost is of long-standing and should not be departed from except for good reasons”. This principle can also be said to be linked to those cases in which a successful party can be liable for costs. In enunciating this principle, Orkin states at page 2-89 “Courts will generally exercise their discretion to award costs against a successful party only in exceptional cases including misconduct…” (emphasis by me). In support of this principle, Orkin cites the case of Wismer v. Javelin International Ltd. (1982) 136d.l.r.3^rd 647 (Ontario HCJ) at page 655 in which the court stated “Although a successful litigant is seldom deprived of costs, and almost never ordered to pay the costs of his unsuccessful antagonist, in special cases, where he has been guilty of misconduct, such an order may be made.” At the August 23 hearing, Webster was represented by Glenn Campbell who had little or no knowledge of Webster’s file. Vice Chair O’Kane analyzed the history of the appeal, noted the apparent lack of commitment on the part of Webster to prosecute his appeal, his absence from the August 23 hearing, his failure to abide by the procedural order and in a well reasoned decision, concluded that the misconduct in failing to observe the procedural order was evidence of a cavalier attitude on the part of the appellant which was worthy of censure.

Since there is authority under Rule 28.04(c) and in the general body of law to impose a sanction for misconduct, I can therefore find no basis to conclude that the order of costs should be reviewed based on these grounds.

6. The City’s failure to serve the Solicitor who had launched the Appeal for 38

affected landowners

The record, and the reasons of Vice Chair O’Kane dated September 1, 2011 disclose that Webster was represented by Glenn Campbell at the August 23 hearing. In his cost submissions to Vice Chair O’Kane dated December 7, 2011, Webster states “The appellant had no large direct costs as Mr. Glenn Campbell was retained to represent the appellant but refused to accept remuneration when the appellant attempted to pay for his services.” (Emphasis by me) On his own admission, Webster was represented at the August 23 hearing. Webster represented himself at the hearing conducted by telephone conference on November 15, 2011. There is no objection by Glenn Campbell to the absence of any lawyer to represent Webster at the August 23 hearing, or by Webster at the November 15 hearing, nor is there any objection in his cost submission dated December 7 to the failure to serve any lawyer. There is no lawyer of record noted in the Tribunal’s file. If a lawyer should have been representing Webster at the August 23 hearing, it would have been incumbent on Webster to advise the Tribunal and arrange for this lawyer’s attendance. If Webster was in fact represented by a lawyer at any time on his Drainage Act appeal during 2011, the objection to proceeding in his lawyer’s absence should have been noted by him or his representative on the record. In my view, the record clearly shows that Glenn Campbell was retained for the limited purpose of making submissions on behalf of Webster at the August 23 hearing and that otherwise, Webster was representing himself at the drainage appeal before the Tribunal at all times including the motions heard by Vice Chair O’Kane. I can therefore find no basis to conclude that the order of costs should be reviewed based on this ground.

7. The report of Paul Courey to the 38 landowners in proceedings before the Drainage Referee …

As was noted previously, the decision of Vice Chair O’Kane is based on misconduct on the part of the appellant in failing to adhere to the procedural order of September 1, 2011. The report of Paul Courey does not absolve Webster of his misconduct and is not relevant to the review of the decision of Vice Chair O’Kane. There is therefore no basis to review the costs motion decision based on this ground.

8, 9 & 10. Reasons for the delay in filing material / Omission is a technical breach /

No delay in the proceeding

Vice Chair O’Kane had stated in his September 1, 2011 decision that “the appellants have had five years to crystallize and refine their Section 48 appeal issues, marshall their evidence and define their appeal strategy. Therefore, in these circumstances, it is reasonable that the appellants provide the level of disclosure, directed above within the twenty day period.” Webster cannot invoke the delay in obtaining the Fudge report as a shelter to excuse his delay in complying with the order. Vice Chair O’Kane conducted a thorough analysis of the reasons invoked by Webster for his delay in complying with his order. He concluded that “Alan Webster is a sophisticated, educated and knowledgeable professional person” and following the review of the facts, he concluded as well “Mr. Webster’s cavalier attitude about complying with an order of this Tribunal is worthy of censure, particularly since the failure to abide by the procedural order deadline directly resulted in the City bringing this dismissal motion. However, the appropriate mechanism for addressing that is by inviting submissions on costs, rather than by way of dismissal.” He concluded as well in his costs decision of December 14, 2011: “In my view it was clearly unreasonable for Alan Webster to fail to comply with the procedural direction set out in my September 1^st order. As noted above, that failure resulted in the unnecessary costs of the dismissal motion. Because those costs were unnecessary, I find that they resulted in undue prejudice to the City of Kawartha Lakes.”

The reasons set out in the costs decision are supported by the evidence and following a careful review of all circumstances by Vice Chair O’Kane, he applied Rule 28.04(c), which refers to clearly unreasonable conduct, the failure to comply with a procedural order and imposed the costs sanction.

There is therefore no basis to review the costs of motion decision based on these grounds.

Decision of the Tribunal

In conclusion, I find that the decision of Vice Chair O’Kane dated December 14, 2011 is a fair and balanced analysis of the issue of costs, and contains no material error of law or fact. There is no basis for a review of this decision under Rule 29.09 of the Tribunal’s Rules of Procedure. The request for a review is hereby denied. No costs shall be awarded to either party for this request for review.

Dated at Ottawa, Ontario this 27^th day of March, 2012.