SUPERIOR COURT OF JUSTICE - ONTARIO
Divisional Court
RE: Lazima Dubajic, Applicant
v.
Regional Municipality of Peel, Respondent
BEFORE: Cunningham A.C.J., Carnwath and MacDougall JJ.
COUNSEL: Douglas Kwan, for the Applicant
R. Kent Gillespie, for the Respondent
HEARD: May 29, 2008 in Brampton
E N D O R S E M E N T
1The applicant seeks judicial review of the appeal decision of the service manager of the respondent Peel.
2The Region had ordered its housing provider, Tomken Grove Non-Profit Homes Inc., to revoke rent-geared-to-income housing for the applicant when it became apparent the applicant had never properly applied for a subsidy.
3The applicant had befriended the property manager of Samuel Property Management Ltd., the company hired by Tomken to manage the property. Learning of the applicant’s difficult circumstances after she had been hired by Samuel as a cleaner, the property manager offered her the position of assistant superintendent which came with a unit in the building at a rental rate based on her income. This amount was several hundred dollars less than market rent. The building had both “rent-geared-to-income” units and “market rent” units. When the appellant advised Samuel that she could not afford to rent a “market rent” unit, Samuel told her that the applicant could qualify to be subsidized for a “rent-geared-to-income” unit and proceeded to have the applicant execute a tenancy agreement.
4By all accounts, and this is not disputed, the applicant was unaware that proper procedure had not been followed. A tenancy agreement was entered into.
5When it came to light that the applicant had not properly obtained her subsidized rent, the Region, taking the position that only it had authority under the Social Housing Reform Act, 2000, S.O. 2000, c.27 (“SHRA”) to grant rent-geared-to-income subsidies, acted to revoke what it determined was an illegal subsidy. Accordingly, the Region wrote to the applicant advising her that her rent would be significantly increased. The applicant appealed the rent increase subsidy revocation decision to the Region’s service manager who dismissed her appeal after a review.
6We have determined the application for judicial review must be allowed on two grounds. Firstly, whether the applicant was in fact in receipt of a legal subsidy, the Region, in order to correct the situation, engaged certain provisions of the SHRA. It ultimately wrote the applicant in July 2006 advising that her appeal of the decision to terminate her rent-geared-to-income subsidy had been denied.
7Section 80 of the SHRA states as follows:
Before a service manager… makes a decision that is adverse to a household and that may be reviewed under section 82, it shall… give the members of the household an opportunity to comment on any information that, in the opinion of the decision-maker, may form a significant basis for the decision.
8Here, the applicant was not afforded an opportunity to comment.
9Prior to the ultimate decision upholding the service manager’s decision to terminate the subsidy and increase the rent, there was, at the applicant’s request, a review of the service manager’s decision.
10Secondly, unfortunately the person charged with the task of reviewing that decision had earlier participated in the making of the decision being reviewed.
11Section 58(2) of Ontario Regulation 298/01 states as follows:
No individual who participated in the making of the decision being reviewed shall participate in the review of that decision.
12In the present case, the file review was prepared by an employee of the Region, one John Perkovic, the very person who earlier had, on behalf of the Region, asked the housing provider, Tomken Grove, to withdraw the applicant’s rent subsidy.
13The applicant also asked for an oral hearing which was denied. In our view, this was not fatal.
14We understand the position of the Region. They say the applicant never had a subsidy, although she was paying rent at a subsidized rate. They say that to be eligible for a subsidy, one must apply to the Region, which maintains a waiting list. Because the applicant was not entitled to a subsidy, they argue that the provisions of the SHRA earlier referred to do not apply. We disagree.
15Once the Region began the process established under the SHRA, it was obliged to follow its provisions. In much of its correspondence, both to the applicant and internally, it referred to the applicant’s “subsidy”. The Region created an expectation that the SHRA procedure would be followed.
16In our view, by failing to properly follow the provisions of section 80 of the Act and section 58(2) of the Regulations, the applicant was denied procedural fairness.
17Because this entire matter was a result of actions which in no way were the fault of the applicant, and because the consequences of revocation were dire, she was entitled to procedural fairness.
18The result of the rent increase of course was that the applicant fell into arrears and proceedings were taken before the tribunal seeking an eviction order unless the significant arrears were paid.
19It is incumbent upon the Region, in circumstances such as this, circumstances created entirely by those hired to manage the property, to follow the provisions of the SHRA when attempting to remedy such a situation.
20In the result, the decision of the service manager dated July 6, 2006 is set aside. The applicant seeks alternative relief. First, she seeks a declaration that she at all times was entitled to receive a geared-to-income subsidy under the SHRA.
21Alternatively, she asks that the matter be remitted back to the respondent for consideration by a different decision-maker.
22We have concluded that the best approach is to remit this matter back to the respondent for consideration by a different decision-maker. We remind the ultimate decision-maker of the aforementioned provisions of the Act and the Regulations. We recognize that a re-consideration hearing by another decision-maker has the potential of being fraught with difficulty in that it would be done by someone else in the same department. Nevertheless, we entrust to the respondent the opportunity for a fair and impartial re-consideration given the concerns expressed in Healey v. Memorial University in Newfoundland, 1992 2756 (NL SC), [1992] 106 Nfld. and P.E.I.R., 304 (Nfld.S.C.).
23If costs cannot be agreed upon, please submit two pages of written submissions within 15 days.
Cunningham A.C.J.
Carnwath J.
MacDougall J.
DATE: July 3, 2008