CITATION: Paudash Shores Cottagers Association v. Ontario (Ministry of Natural Resources), 2012 ONSC 2839

DIVISIONAL COURT FILE NO.: 467/11

DATE: 20120531

ONTARIO

SUPERIOR COURT OF JUSTICE

DIVISIONAL COURT

SWINTON, SACHS AND WILTON-SIEGEL JJ.

B E T W E E N:

PAUDASH SHORES COTTAGERS ASSOCIATION Applicant

and -

HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO (MINISTRY OF NATURAL RESOURCES) AND ROSS E. DUNCAN Respondents

Colin P. Stevenson and J. Daniel McConville, for the Applicant Eunice Machado, for the Respondent Ministry of Natural Resources Ian Cantor, for the Respondent Ross E. Duncan

HEARD at Toronto: April 27, 2012

Swinton J.:

Overview

[1] The Paudash Shores Cottagers Association (“the Association”) has brought an application for judicial review to quash the decision of the Minister of Natural Resources granting a Class B licence under the Aggregate Resources Act, R.S.O. 1990, c. A.8 (“the Act”) to the respondent Ross E. Duncan. For the reasons that follow, I would allow the application and set aside the decision granting the licence because of the misinformation regarding the zoning applicable to Mr. Duncan’s property that was provided at the time the Minister issued the licence.

The Background Facts

[2] Mr. Duncan purchased property in the Township of Cardiff in the County of Haliburton in 1985. He built a house on the property and, for many years, he also operated a construction business known as RED Construction from his property. At times he removed fill from his land for projects on the land of cottagers in the vicinity.

[3] As of January 1, 2007, the Aggregate Resources Act began to apply to pits and quarries on private land in the County of Haliburton. “Pits” are defined in s. 1(1) of the Act as

land or land under water from which unconsolidated aggregate is being or has been excavated, and that has not been rehabilitated, but does not mean land or land under water excavated for a building or structure on the excavation site or in relation to which an order has been made under subsection (3).

[4] Section 7 of the Act requires a person to obtain a licence before operating a pit or quarry on private lands subject to the Act. Accordingly, in June 2007, Mr. Duncan applied for a Class B licence under the Act for his property. This would allow him to remove up to 20,000 tonnes of aggregate annually from a pit. He indicated that the type of material to be removed would be sand and gravel and crushed stone.

[5] None of the neighbouring landowners were aware of Mr. Duncan’s application, as the Act contains no notice requirements when a licence is sought for an established pit or quarry.

[6] Subsection 71(4) of the Act permits an “established pit or quarry” to operate without a licence for a limited period if an application for a licence has been made. Subsection 71(5) of the Act, a grandfathering provision, is key in the present application. It provides that the Minister of Natural Resources shall issue a licence to an established pit or quarry if the Minister is “satisfied” of two things: first, the application pertains to an “established pit or quarry”, and second, “the location of the land on which the pit or quarry is situate complies with all relevant zoning by-laws”. An “established pit or quarry” is defined in s. 1(1) as a pit or quarry from which a “substantial amount of aggregate” has been removed within the two year period prior to designation.

[7] Mr. Duncan included letters from four individuals with his application in order to show that sand and gravel had been removed from his property for many years. He also provided a Confirmation of Municipal Zoning or Legal Non-Conforming Use (the “Confirmation”), a form apparently created by the Ministry of Natural Resources (“the Ministry”). The printed form indicates that the applicant is making an application for a licence under the Act as an established pit/quarry on the identified property. The form then states that the Ministry requires municipal confirmation of the zoning of a site before a licence is issued and asks the municipality to check one of two boxes:

The property is zoned , which permits pit and quarry operations;

OR

The municipality recognizes that the pit or quarry operation has a legal non- conforming use.

[8] The CAO/Treasurer of the Municipality of Highlands East, Sharon Stoughton-Craig, ticked the second box on Mr. Duncan’s form and signed it, dating the form July 4, 2007.

[9] An official of the Ministry attended at Mr. Duncan’s property to confirm there was an established pit. He relied on the Confirmation signed by the municipality to conclude that the pit was a legal non-conforming use. As a result, a licence was issued to Mr. Duncan on December 20, 2007.

[10] Catherine Bowles, President of the applicant Association, swore an affidavit that she became aware of a material change in the use of the Duncan lands in August 2008, when a bulldozer was being used to strip trees and topsoil. After inquiries, she learned about Mr. Duncan’s licence to operate a gravel pit. She was also informed that Mr. Duncan was carrying on a legal non-conforming use, which led her and others to make inquiries about zoning.

[11] Mr. Duncan’s property is located in an area zoned Rural under the current By-law 2005-29 of Highlands East. A pit is not a permitted use in this zone. Instead, pits and quarries are permitted in the Extractive Industrial (MX) Zone (s. 4.16). However, the by-law protects existing legal non-conforming uses.

[12] In the first zoning by-law affecting Mr. Duncan’s land, adopted by the Township of Cardiff in 1979, Mr. Duncan’s property was also located in an area zoned Rural. Under this by-law, the permitted uses in the Rural zone included a “wayside pit or borrow pit” (s. 10.1.8). A “wayside pit” was a defined term, referring to a temporary pit opened and used by a public road authority solely for the purpose of road construction. A wayside pit is also a defined term in the current Act. A “borrow pit” was not defined in the by-law, nor is the term found in the Act.

[13] Elsewhere in the 1979 by-law, the Extractive Industrial zone included the permitted use of the establishment of pits and quarries for the purpose of extracting natural materials from the earth (s. 15.1.1).

[14] It is clear from the evidence filed by the Association that there was no pit operation on the subject lands at the time the first Cardiff zoning by-law was adopted in 1979. Nor was there a pit in operation on the lands when Mr. Duncan purchased them in 1985. At the hearing of this application, this evidence was not contested by any cogent evidence from Mr. Duncan. Accordingly, there was no pit on the property that could qualify as a legal non-conforming use at the time the first zoning by-law came into effect.

[15] In May, 1991, the 1979 by-law was amended. Permitted uses in the Rural zone under the amended by-law included a “wayside pit or a wayside quarry.” There was no longer mention of a borrow pit as a permitted use. Mr. Duncan now takes the position that he operated a borrow pit on his property in the 1980’s. Because he operated a borrow pit before May 1991, his pit operation continued to be a legal non-conforming use under the by-law as amended in May 1991, and it continues to be a legal non-conforming use under the current By-law 2005-29.

[16] No one from the municipality was asked to provide evidence for this application. However, the Association attached a number of communications from individuals affiliated with the municipality, which demonstrate that there was confusion about the basis for concluding that the pit is a legal non-conforming use on Mr. Duncan’s property. For example, in an August 23, 2010 email, Ms. Stoughton-Craig, the individual who signed the Confirmation, indicated that she had received a letter from Mr. Duncan regarding use of the pit from 1964. If that was the basis on which she signed the Confirmation - that there had been a pit before the first zoning by-law was passed - she erred in stating that the pit was a legal non-conforming use. The evidence is clear that there was no pit on this property prior to the date in 1985 when Mr. Duncan purchased it. The letter appended to his affidavit from Mr. Jones, the person who sold the property to him, states that Mr. Jones did not operate a commercial pit on this property, nor did he know of anyone else who carried on such an operation.

[17] Subsequently, in December 2010, a town councillor informed Ms. Bowles that Mr. Duncan’s use of the land was permitted because a wayside pit was a permitted use. Again, if that was the basis for the issuance of the Confirmation, it is evident that the Confirmation was issued in error, because a wayside pit is a temporary pit operated by a public road authority. Mr. Duncan himself does not now suggest that his operation could legally fall within this use.

[18] In a letter dated April 26, 2011, outside counsel for the municipality wrote to the Ministry indicating that there may have been an error in the Confirmation that Mr. Duncan had a legal non-conforming use. The letter included a copy of the letter from Mr. Jones, the prior owner, indicating that the land had not been used as a pit before 1985. However, the Ministry refused to act, given the licence had been issued.

[19] In his first affidavit in the responding materials in this proceeding, Mr. Duncan took the position that, to his knowledge, “in the 1970’s and previously, aggregate from [his] lands were used by private contractors, as a condition of developing the area to build roadways.” This evidence was apparently put forward to show a legal non-conforming use as a pit in 1979. However, in a supplementary affidavit, after asserting that there was “no valid substantiation for the Applicant’s implication that the use of [his] property as a pit was prohibited under the 1979 by-law”, Mr. Duncan changed his tack and asserted that his pit operations constituted a borrow pit under the 1979 by-law.

[20] In oral argument in this application, Mr. Duncan also took the position that he has been operating a borrow pit on his land for over twenty years, and, therefore, he had a legal non-conforming use when the 1991 by-law amendments came into effect. He has also presented evidence that the cottagers knew that he had a construction business on the land, and that he excavated fill from his land to use in projects in the vicinity, including projects on the lands of many of the cottagers. This latter evidence is not of any value in determining whether his operations constituted a borrow pit under the 1979 by-law.

Analysis

[21] The Association argues that the licence should be set aside because it was issued on the basis of mistaken or misleading information. In the alternative, it argues that the Minister had no authority to issue the licence on the basis of a legal non-conforming use, because s. 12.1(1) requires compliance with a zoning by-law, and a legal non-conforming use does not constitute compliance.

[22] The Ministry took no position on the merits of the application, indicating that if this Court finds there is no legal non-conforming use, then the licence would be void because of s. 12.1 of the Act. That section prohibits the issuance of a licence if a zoning by-law prohibits the site from being used for a pit or quarry.

[23] The municipality has not taken steps to curtail Mr. Duncan’s operations. This may well be because of s. 66 of the Act, which provides that the Act, its regulations and the provisions of licences and site plans apply despite any municipal by-law. Therefore, the members of the Association find themselves in something of a quandary, as neither the Ministry nor the municipality will act, despite the apparent confusion and misinformation about the zoning and past use of the subject property.

[24] This Court, on judicial review, is not in a position to make a final determination as to whether Mr. Duncan’s pit is a legal non-conforming use. In order to determine the legality of the use, given Mr. Duncan’s present argument that he has a legal non-conforming use because he operated a borrow pit, there is a need for evidence as to what a borrow pit is. This would permit a determination whether Mr. Duncan’s operation was a borrow pit prior to the 1991 by-law amendment, and whether his current operation is a continuation of that use.

[25] The role of the Court on judicial review is to determinate whether the decision of the Minister can stand, given the present evidence respecting the zoning by-laws and the past use of the land.

[26] The standard of review of the decision, in the present case, is correctness. An official from the Ministry applied the provisions of the Act, but gave no reasons for the decision at the time. However, from an affidavit filed, it is evident that the Ministry relied solely on the municipality to determine the legality of the use of Mr. Duncan’s land. Moreover, the Ministry had no discretion to exercise when determining whether the pit was a lawful use, and the officials have no particular expertise on zoning questions. In these circumstances, there is no reason for this Court to defer to the Ministry’s decision respecting the zoning.

[27] With respect to the merits of the application. I would not give effect to the Association’s argument that s. 12.1(1) prevents the Minister from granting a licence to a pit unless the current zoning by-law expressly permits that use. In other words, the Association argues that the Minister could not grant a permit where the pit is a legal non-conforming use.

[28] Subsection 34(9) of the Planning Act, R.S.O. 1990, c. P.13 addresses the effect of a change to a zoning by-law. It provides that a by-law passed under s. 34 by a local municipality does not prevent the use of any land for a purpose prohibited by the by-law if the land was lawfully used for such purpose on the day of the passing of the by-law, and so long as the use continues. Section 71 of the Planning Act provides that in the event of a conflict between the Planning Act and “any other general or special Act”, the provisions of the Planning Act prevail. Accordingly, s. 12.1(1) of the Aggregate Resources Act should be read in light of s. 34(9) of the Planning Act. Therefore, the Minister may confer a licence on a pit that is a legal non-conforming use on a site.

[29] That brings me to the primary issue: whether the Minister’s decision should be set aside on the grounds of non-compliance with s. 71(5) of the Act. This is an unusual case, in that the factual matrix of Mr. Duncan’s claim has changed significantly since the time of the Minister’s decision. Moreover, it is clear from the evidence before this Court that the Minister issued the licence to Mr. Duncan on the basis of misinformation provided to and by the municipality. His application, as structured, appears to have left the municipality with the impression that he had a pit in operation prior to the 1979 by-law.

[30] Mr. Duncan made an application under the Act for a pit licence. Given the argument he now makes before this Court, he never claims to have operated a pit per se. Indeed, had he claimed to have operated a pit, the use would have been prohibited in the Rural zone when he commenced operations sometime after his purchase in 1985, given the terms of the 1979 by-law.

[31] At most, Mr. Duncan now claims to have operated a borrow pit. However, that fact was not disclosed to the municipality nor, more importantly, was that revealed on the Confirmation provided to the Ministry. To some extent, the problem arises because of the form of the Confirmation. While the zoning is to be specified if there is an authorized use for a pit, there is no requirement for the municipality to explain the basis for its conclusion that the applicant exercises a legal non-conforming use. As we see in the present case, this can give rise to confusion and misunderstanding.

[32] Here, the municipality appears to have made the determination about the legal non-conforming use on the basis of information provided by Mr. Duncan himself. As mentioned, there has been some confusion as to the specific basis for the municipality’s determination of a legal non-conforming use, but there is no evidence that the municipality was ever asked to assess whether Mr. Duncan operated a borrow pit. Counsel for the Ministry made it clear that if the Ministry had been aware that Mr. Duncan’s non-conforming use was as a “borrow pit” rather than a “pit”, it would have taken a much closer look at the application.

[33] Further, there is strong reason to suspect that Mr. Duncan’s operations may not be a borrow pit, given that a wayside pit and a borrow pit are in the same provision of the by-law permitting these uses in the Rural zone. A wayside pit is a temporary use for road construction by a public authority. The association of a wayside pit with a borrow pit suggests that a borrow pit may be temporary as well. As noted by Ruth Sullivan in her text entitled Statutory Interpretation (Concord, Ontario: Irwin Law, 1997), at page 63:

Where two or more words or phrases perform a parallel function within a provision and are linked by “and” or “or,” the meaning of each is presumed to be influenced by the others. The interpreter looks for a pattern or a common theme in the words or phrases, which may be relied on to resolve ambiguity or to fix the scope of the provision.

[34] In the present case, given the misinformation about the zoning applicable to Mr. Duncan’s operations and the nature of his operations, there is no justifiable basis for the decision to grant the licence, and it cannot stand. Had the Ministry had the proper information, the Minister would not have granted the licence without further inquiry and, if in doubt about the legality of the use, an application could have been brought before the Superior Court of Justice in accordance with s. 12.1(3) of the Act.

[35] Mr. Duncan submits that even if the application for judicial review might otherwise succeed on the merits, the Court should exercise its discretion to dismiss the application because of excessive delay. He argues that the Association should have moved more quickly to quash a licence that was granted to him at the end of 2007, pointing out that he is 72 years of age and the aggregate business is his primary source of income, as he has given up his construction business.

[36] This Court has discretion to refuse to grant judicial review because of delay by an applicant (Zaki v. Ottawa Hospital (General Campus), 2003 CarswellOnt 880 (Div.Ct.)). However, I see no reason to do so in this case. The Association has explained the process leading to this application. Its members had first to acquire information about the licensing decision and the zoning, and then they tried to proceed through the political and administrative process, seeking the assistance of the municipality and the Ministry without success before they finally turned to judicial review.

[37] I see no evidence that Mr. Duncan has been prejudiced by the delay in these proceedings. In fact, he has benefitted from the use of the licence for several years, despite a flawed process whereby he obtained the licence.

Conclusion

[38] For these reasons, the application for judicial review is granted. The decision of the Minister granting the licence to Mr. Duncan is set aside, and the matter is referred back to the Minister. If the parties cannot agree on costs, the Association may make brief written submissions within 21 days of the release of these reasons, with the respondents making a response within 15 days thereafter. All submissions are to be made through the Divisional Court office.

Swinton J.

Sachs J.

Wilton-Siegel J.

Released: May 31, 2012

CITATION: Paudash Shores Cottagers Association v. Ontario (Ministry of Natural Resources), 2012 ONSC 2839

DIVISIONAL COURT FILE NO.: 467/11

DATE: 20120531

ONTARIO