Court File and Parties

Emshih Developments Inc. v. Waterdown Bay Ltd, CITATION: 2015 ONSC 1958

COURT FILE NO.: DC-14-618ML

DATE: 2015-03-26

SUPERIOR COURT OF JUSTICE – ONTARIO

DIVISIONAL COURT

RE: Emshih Developments Inc., moving party

AND: Waterdown Bay Ltd., City of Hamilton, Halton Region Conservation Authority, responding

BEFORE: Mr Justice Ramsay

COUNSEL: Mr Dennis H. Wood for Emshih Developments Inc.; Mr Scott Snider and Ms Shelley Kaufman for Waterdown Bay Ltd.; Mr Michal E. Minkowski for City of Hamilton; Mr Stan Floras for Ontario Municipal Board; Mr John C.T. Inglis for Halton Region Conservation Authority

HEARD: 2015-03-24

ENDORSEMENT

[1] Emshih Developments Inc. moves for leave to appeal to the Divisional Court from two decisions of the Ontario Municipal Board:

a. The order of the board of April 24, 2014 under s.51(34) of the Planning Act approving phase 2 of the subdivision plan for Waterdown Bay; and

b. The decision of the Chair of September 19, 2014 under s.43 of the Ontario Municipal Board Act declining to review the order of April 14.

[2] Under s.96 of the Ontario Municipal Board Act, an appeal from the board lies to the Divisional Court on a question of law with leave of the court. To get leave to appeal, the moving party must show

a. That there is good reason to doubt the correctness of the decision on a question of law; and

b. The question is of sufficient importance to warrant the attention of the Divisional Court.

[3] The first branch of the test is met if I find not that the decision is wrong or even probably wrong, but that its correctness is open to serious debate. The second branch is met if the matter is relevant to the development of the law and the administration of justice. It can however be important only to the litigants: Chan v. Fazaeli, 2010 ONSC 3432 (Div. Ct, Jennings J.).

[4] Emshih Developments Inc. (“Emshih”) says that it was denied natural justice because the board approved the subdivision plan in question without giving Emshih any notice and because the board, having been apprised of Emshih’s interest, declined to review the decision and re-open the hearing.

The approval of the subdivision plan

[5] Emshih owns a tract of land south of Mountain Brow Road. The Emshih property contains one residence, which is occupied by Emshih’s principals, Dr and Mrs Shih. It is within the bounds of the City of Burlington, below the brow of Hamilton Mountain. Between the Emshih property and Mountain Brow Road is land owned by the Halton Conservation Authority. Emshih has an easement which allows the Shihs a driveway to Mountain Brow Road. At Mountain Brow Road they can turn left and go west toward Hamilton or turn right and go east toward Burlington. The original proposed plan of subdivision envisaged Burke Street meeting Mountain Brow Road at right angles, just west of the Shih driveway. The interchange would be controlled by a roundabout. If Emshih had known about all this, none of it would have caused them any concern.

[6] In 2004 Waterdown Bay Developments Ltd. (“Waterdown Bay”) applied to the City of Hamilton, the approval authority, for approval of a subdivision to be called Mountainview Heights, north of, and abutting, Mountain Brow Road. The City did not respond. This gave Waterdown Bay the right to appeal to the Ontario Municipal Board under s.51 (34) of the Planning Act. In such an appeal, commonly called a “no-decision appeal”, the board has the right to make any decision that the City might have made.

[7] In such an appeal, the Planning Act requires the board to hold a hearing, “notice of which shall be given to such persons or public bodies and in such manner as the Board may determine.” The Board followed its usual practice, which is to give notice similar to the notice required of municipalities by O.Reg. 544/06. That is to say, it gave notice to all owners of land within 120 metres of the proposed subdivision. For the purpose of this notice the board defined owners of land as persons shown on the last revised assessment roll of the municipality. The regulation defines owners of land the same way. Emshih does not fall within the definition. It owns an easement over land within 120 metres of the proposed subdivision and its name does not appear on the tax roll. Emshih does not pay property tax to Hamilton on its easement. It pays property tax for its whole property to Burlington, and it appears on Burlington’s tax roll as owner of property that is 450 metres from the proposed subdivision. The fact that the Burlington land has a Hamilton address on Mountain Brow Road is irrelevant, except to the post office.

[8] O.Reg. 544/06 requires municipalities to take other steps to notify persons. The municipal board is not bound to apply these additional requirements to itself, and it did not.

[9] Subsequently, phase 1A of the subdivision plan was approved.

[10] In 2007 the secondary (i.e. official) plan for Waterdown Bay subdivision was approved. It re-configured Burke Street to have it meet Mountain Brow Road on a curve. This would require the City to close Mountain Brow Road just west of the Emshih driveway. To go west, the Shihs would have to drive straight up through future “T Street” and then go left onto future Burke Road. They would be driving past subdivision houses. This would not be a problem for the Shihs, but Emshih wants to develop its lands as a subdivision. It would not be acceptable to route a high volume of westbound traffic through the Mountainview Heights subdivision.

[11] In 2012 Waterdown Bay took steps to have phase 2 approved. Phase 2 includes Burke Street. The board ordered on January 2, 2014 that the parties to the second hearing, that is, the persons to be notified, would be the persons who participated in the phase 1A hearing, that is, Waterdown Bay, the City and the Halton Conservation Authority. Again, Emshih did not receive notice.

[12] It is not arguable that the board had any way of knowing about Emshih. After hearing some evidence, the parties agreed on a final order of the board. On April 14, 2014 the board approved phase 2 of the subdivision plan.

[13] Emshih found out about the proposed road closure in January 2014. It received confirmation from the City in May 2014 and at that point decided to act. Through its counsel, it applied to the board for a review of the April 14 decision.

The request for a review

[14] Section 43 of the Ontario Municipal Board Act simply states that the board may rehear any application and may review, rescind, change, alter or vary any decision, approval or order made by it. The legislation leaves the basis upon which this power should be exercised to the discretion of the board.

[15] The board has made rules to set the applicable principles. Rule 115.01 of the board’s Rules of Practice and Procedure provides:

The Chair may exercise his/her discretion and grant a request and order either a rehearing of the proceeding or a motion to review the decision only if the Chair is satisfied that the request for review raises a convincing and compelling case that the Board:

a. acted outside its jurisdiction;

b. violated the rules of natural justice;

c. made an error of law or fact such that the Board would likely have reached a different decision;

d. heard false or misleading evidence from a party or witness, which was discovered only after the hearing and would have affected the result; or

e. should consider evidence which was not available at the time of the hearing, but that is credible and could have affected the result.

[16] In its own jurisprudence, the board has emphasized that a review is exceptional. The board does not want to become an appellate body, routinely hearing appeals from its own decisions. See Shanahan v. Russell, 2000 17036 (ON CA), [2000] O.J. No. 4762 (CA), paragraph 11.

[17] It is all but conceded that the board had no way of knowing about Emshih before the application for review, short of doing a title search on every property within half a mile. It seems to me that the most likely avenue for review would have been on the basis that Emshih had evidence about the effect of the subdivision plan on its own plans, that this evidence was not available at the hearing and that it could have affected the result. If accepted, that would have been a recognized ground of review under board rule 115.01(e). But the request was not put to the Chair on that basis. Counsel for Emshih asked for a review under rule 115.01(b) on the basis that the failure to notify Emshih of the appeal hearing violated the rules of natural justice and procedural fairness. It made two arguments in support: it should have been notified because its right of way is within 120 metres of the proposed subdivision, and O.Reg. 144/06 required that notice be given to it. Both submissions were wrong. Not surprisingly, the Chair did not give effect to either argument.

Conclusion

[18] The requirements of natural justice and procedural fairness amount to a question of law. In the present case they are governed by legislation which gives broad discretion to an expert board as to how and to whom notice should be given. The nature of the proceedings is unique. The decisions of the municipal board have the potential to affect huge numbers of people. It was never contemplated that every person who might somehow be affected by a decision should be given notice of an appeal to the municipal board. For example, in the present case the board required that ground water be tested downstream of the subdivision. No one would suggest that every land owner whose water might be affected had to have notice of the hearing. Rather, it gave the board the power to protect them in the exercise of its judgment.

[19] It cannot seriously be argued that the board was wrong to proceed without notice to a party that it could not have known about. Nor is there room to doubt the correctness of the Chair’s decision not to re-open the appeal. The first requirement for leave has not been met.

[20] It is not necessary to deal with the second requirement, but I would say that I doubt the importance of the question for two reasons. First, it was the secondary plan, not the subdivision plan that reconfigured Burke Street and put into motion the closing of Mountain Brow Road. Second, it is far from clear that Emshih’s easement could accommodate the traffic of a subdivision. Approval of a subdivision on Emshih’s land is no more than speculative at this point.

[21] Leave to appeal is denied. Waterdown Bay and the City of Hamilton may make written submissions to costs within 10 days of release of this endorsement. Emshih may make written submissions within 10 days thereafter. The other responding parties did not take part to the extent that a cost order for or against them would be considered.

J.A. Ramsay J.

Date: 2015-03-26