DIVISIONAL COURT FILE NO.: DC-08-092466-00

Released: 20090430

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

RE: Marilyn Hefford and John Hefford v. Stephen Douglas Charpentier and Eliane Charpentier

BEFORE: Cunningham A.C.J., Hackland, R.S.J., Taliano, J.

COUNSEL: Gleb Bazov, for the Appellants Sonja Hodis, for the Respondents

HEARD AT NEWMARKET: March 13, 2009

E N D O R S E M E N T

[1] This is an appeal from the judgment of McIsaac J. in which he awarded a declaration of trespass, general damages of $1,000, punitive damages of $2,500 and costs of $15,000. The judgment was rendered pursuant to an Application brought under Rule 14.05(3) of the Rules of Civil Procedure and in response to conflicting affidavit material. The appellant[^1] submits that the claim was not authorized by this Rule and in addition, the court lacked jurisdiction to hear the matter in this fashion.

[2] The parties are neighbours who entered into an agreement to share the cost of erecting a fence between their two properties. During the digging of the post holes, a dispute led the appellant to conclude that he should place the fence entirely on his own property which he thought he was doing. The fence was constructed and some time later, the respondent attached a gate/arbour to his side of the fence, which the appellant removed without consultation. The respondents commenced their Application claiming a mandatory order for the removal of the fence, a declaration of trespass, general or nominal damages of $5,000, punitive damages in the sum of $15,000 and costs. Multiple affidavits were filed by both sides to the dispute.

The Issue:

[3] The appellant submits that the Application process envisioned by Rule 14.05(3) does not permit the adjudication of claims in trespass where material facts are in dispute, nor does it contemplate a dispute where general, non-liquidated damages and punitive damages are sought.

[4] The respondent submits that it was conceded before McIsaac J. that a trespass had been committed and therefore the material facts were not in dispute.

The Appellant’s Position at the Hearing:

[5] The appellant’s version of events was that there was an agreement that the appellant was to pay for the supply and installation of the fence posts in exchange for the respondent performing electrical work in the appellant’s basement. The expense of installing the 2 X 4’s and hardware was to be shared and each party was to pay for their own fence boards.

[6] The appellant hired Genaro Sisera, a professional fence installer, to construct the fence and when he attended to set the fence posts, the respondent started “behaving aggressively” and “raised havoc”. That led the appellant to decide to place the fence 4 inches on his own side of the boundary line to avoid future conflict. In addition, the appellant deposed that he paid for the fence. The appellant also alleged that the respondent never completed the electrical work he had agreed to perform for the appellant and did not pay for his share of the expenses incurred in constructing the fence. The appellant therefore felt at the relevant time, that he owned the fence and that he was justified in removing the arbour/gate which the respondent subsequently erected on the respondent’s side of the fence. He removed the arbour in broad daylight and did not know that the respondent was not at home when he did so. In removing the arbour/gate the appellant relied on the advice of an engineer as to how to remove it without doing damage and without stepping on the respondent’s property. At the hearing when the respondent produced a survey showing the fence on the boundary line, the appellant conceded a technical trespass and indicated that he was prepared to replace the arbour and share the fence since it was on the boundary line rather than on his own property as he originally thought.

The Respondent’s Position at the Hearing:

[7] The respondent’s position was clearly at odds with the appellant’s version of events. He stated in his affidavit that he had in fact completed the electrical work that had been bargained for with the appellant and that the value of his work was the equivalent to at least half of the expense of the fence. He also contended that he obtained a survey of the property, a copy of which he declined to provide to the appellant, although he was prepared to permit it to be viewed at his lawyer’s office. It indicated that the fence was on the boundary line between the two properties and not on the appellant’s property. He also alleges that the appellant removed the arbour, which had a value of $85, when the respondent was not at home and further alleges that the appellant could not possibly have removed the arbour/gate without going onto the respondent’s property because when he returned home, the arbour was lying neatly on his own side of the property line.

[8] In summary then, the appellant’s version of events indicates that he acted on a mistaken belief, acquired on the basis of a fence contractor’s assertions, that the fence was entirely on the appellant’s property and that any trespass committed was technical or inadvertent and committed in broad daylight.

[9] On the other hand, the respondent’s version is that the appellant removed the arbour/gate when the respondent was not at home and in so doing acted in a high-handed fashion. He alleges that the appellant’s trespass was willful and deserving of punitive damages.

[10] With respect to general damages, the appellant denied that the respondent had suffered any damages by reason of the appellant’s conduct. In addition, no particulars of the general damage claim were furnished in the respondent’s Application. The only figures detailed in the respondent’s affidavit materials had to do with special damages of a modest amount which the trial judge rejected on the grounds that the claim was not pleaded. Certainly, the general damage claim was neither liquidated nor supported by invoices. The Application judge stated, however, that he was satisfied that the respondent had “suffered a loss worth $1,000 as a result of this trespass”.

[11] With respect to punitive damages, he stated:

…the appellants have satisfied me the conduct of the respondent, John Hefford, was so egregious that it is deserving of an award of punitive damages. Assuming he was misinformed by an individual whom he thought was an employee of the City of Barrie, he still proceeded in a high-handed and sneaky manner. See Hanna v. Muir, 2000 BCSC 1388, [2000] B.C.J. No. 1890 (S.C.) at para. 35. On the other hand, I am not satisfied that the conduct comes anywhere near justifying an award in the $7,000 – $15,000 range suggested by Ms. Knauff. In all of the circumstances, an award of $2,500 is sufficient to communicate the message that tort will not pay: see Paradiso v. Talbot, [2003] O.J. No. 3044 (S.C.J.) affirmed [2007] O.J. No. 4593 (C.A.).

[12] It was incumbent upon the respondent to prove that the appellants’ actions were “arrogant, callous, oppressive, arbitrary, high-handed, malicious and calculated”. To attract punitive damages, the actions had to show a wanton disregard for the respondent’s rights as a property owner. However, in view of the contested affidavit material, it is not clear how the learned trial judge could have concluded on a balance of probabilities that the claim for punitive damages had been established without first having had recourse to the usual safeguards that a trial or at the very least, cross examination on the affidavits, would have provided.

[13] The legitimacy of the appellant’s belief was a critically important issue with respect to the punitive damage claim yet the trial judge must have rejected the appellant’s explanation summarily in spite of the fact that the explanation might reasonably have been true. Certainly, the events described by the appellant were plausible and were supported to some extent by an independent witness. Each day in the courts of Ontario, a decision maker is confronted with conflicting affidavit material and declines to make findings without access to the benefits of processes which assist the court in determining which version of events is preferable. This judgment represents a serious departure from that well established procedure. If the appellant’s version of events could be characterized as far fetched or patently unreliable, perhaps dispensing with more formal proof might have been warranted. However, in our view, the appellant’s evidence was not so devoid of merit as to warrant its summary rejection.

[14] It is true that at the hearing before McIsaac J. the appellant conceded a technical trespass because the respondent’s survey showed the location of the fence on the boundary line. However, damages were certainly not conceded and the jurisdictional issue was raised, although it may not have been pressed by counsel for the appellant. Earlier in the process, by letter dated January 14, 2008, counsel for the appellant expressed an intention to move to strike the application as an abuse of process, but no such motion was ever launched.

[15] It is therefore disputed as to what extent counsel for the appellant raised concerns about the propriety of presenting the issues by Application. Counsel for the respondent states at paragraph 25 of her factum that the issue was only raised by counsel for the appellant (who was not counsel on the appeal) as an “afterthought” at the beginning of his submissions. She rightfully points out that counsel for the appellant in written submissions before McIsaac J. characterized the application as being “technically valid”.

[16] However, at paragraph 16 of the respondent’s factum, counsel uses terminology that suggests that the “afterthought” may have been more than that. She states:

The opposition (emphasis added) to the bringing of an application as the proper procedure was only raised after extensive affidavits and reply affidavits were exchanged, the parties had submitted factums and books of authorities and the Respondent’s counsel had presented her case to Justice McIsaac.

[17] The appellant applied for an extension of time to commence an appeal of the decision and also sought leave to appeal the costs award. In reasons for judgment dated December 4, 2008, Stong J. granted the extension and leave to appeal costs and stated:

At the hearing of the Application, Mr. Barzo made the following submissions:

(a) he raised the issue of propriety of proceeding by way of application pursuant to Rule 14.05(3);

(b) he asserted that parties could not foist jurisdiction on the court; and

(c) he submitted that the proceeding was not properly brought as an application.

[18] At paragraph [4] of his judgment, Stong J. had this to say:

The application stripped of the plea for a mandatory order and the claim for co-ownership of the fence became an amalgam of a declaration of trespass and a claim for general and punitive damages, a formulation which must be asserted by way of action pursuant to the Rules.

[19] No transcript of the proceedings before McIsaac J. was filed by either party and therefore it is not possible to characterize the nature of the objection taken by the appellant to the process with any greater certainty. However, it is clear that the jurisdictional issue had been raised by the appellants (however forcefully it cannot be determined on the material before us). However, at the very least, it is fair to say that the jurisdictional difficulty was red-flagged.

[20] McIsaac J. certainly treated it as a live issue because the opening line of his judgment states:

I am satisfied that the issues before me are amenable for resolution by way of an application under R. 14.05(3)(e): see McKay Estate v. Love (1991), 6 O.R. (3d) 511 (Gen. Div.), affirmed 6 O.R. (3d) 519 (C.A.).

[21] Accordingly, it is not accurate to suggest that there was a waiver to this irregularity or a consent to the process. In any event, we are of the view that jurisdiction cannot be conferred where it does not exist nor can a defective process be ignored or condoned.

[22] Rule 14.05(3)(e) provides:

A proceeding may be brought by application where these rules authorize the commencement of a proceeding by application or where the relief claimed is,

(e) the declaration of an interest in or charge on land, including the nature and extent of the interest or charge or the boundaries of the land, or the settling of the priority of interests or charges;

[23] The only declaration sought by the application was a declaration of trespass. No relief was sought that pertained to the boundary itself. Although it is true that to establish a trespass, the boundaries of the land would have to be determined, the relief sought was not so framed. Rather the claim that was formulated sought the removal of the fence and a declaration of a trespass (which is considered to be a tort of strict liability) and compensation in the form of general and punitive damages. That poses yet another difficulty.

[24] Numerous authorities have been cited by counsel for the appellant, for the proposition that general and punitive damages are not the types of relief available under Rule 14.05. For instance, in Ontario (Minister of Natural Resources v. Holdcroft), [2004] O.J. No 697, the court held that it was “not permitted to claim damages in an application under the Rules”. In Dovale v. Metropolitan Toronto Housing Authority, [2001] O.J. No. 473, Molloy J. struck out paragraphs of the Notice of Application dealing with damages and directed that these claims should be pursued by way of action. She stated at para. 12;

A claim for damages, particularly based on disputed facts, does not fall within rule 14.05(3) and is therefore not properly brought by way of application.

[25] Similar language may be found in Rintoul v. Mississippi Mills (Town), [2005] O.J. No. 4844. and in Boreal Insurance Inc. v. Lafarge Canada Inc., [2004] O.J. No. 1571.

[26] Accordingly, the hearing of this case as an Application under Rule 14.05(3)(e) flies in the face of well established case law that holds that Rule 14.05(3) is not available for the resolution of general and punitive damage claims.

[27] In the circumstances, the order of McIsaac J. must be set aside with the exception of the declaration "that John Hefford has trespassed on the Applicant's property". There must be a trial of an issue as to the respondent's entitlement to general and/or punitive damages. The parties are invited to consider whether this issue should be tried in Small Claims Court.

Costs:

[28] The application judge's costs award was based in part on his award of damages and cannot therefore stand. Leave to appeal the costs award is granted and the award is set aside. Costs of the application are reserved to the court hearing the assessment of damages.

[29] As to the costs of this appeal, success is divided and accordingly there will be no order as to costs.

Cunningham A.C.J.

Hackland R.S.J.

Taliano J.

DATE: April 30, 2009

[^1]: Although the wives are parties to these proceedings, they have not played active roles in the events leading up to the litigation or in the litigation itself and accordingly references are to the male parties in the singular.