APPELLANTS

-AND-

CORPORATION OF THE TOWNSHIP OF ROMNEY

RESPONDENT

DECISION

An application was made to the Ontario Drainage Referee in the City of Chatham, Ontario on the 14^th day of August 1996 by 32 assessed owners on the Tunnel Drain in the Township of Romney. The Appeal was pursuant to Section 106 of the Drainage Act, R.S.O. 1990, Chapter D.17 requesting that the Referee set aside a resolution passed by the Township of Romney on the 11^th day of July 1994 which ordered certain work be done on the Tunnel Drain and to further set aside By-law No. 58-1994 which undertook to levy the cost of such works against the lands of the assessed owners in the Tunnel Drain Watershed.

At the commencement of the Hearing, Council for the Township of Romney made a preliminary motion requesting that the Appeal of the assessed owners be dismissed forthwith, stating that it had no legal standing whatsoever. He argued that the work undertaken by the Township of Romney was merely a work of simple repair and that the Township was authorized to do such work without the Report of an Engineer and he referred to the 1966 case of Judge Clunis, namely Bodnarchuk and the Township of West Gwillimbury, which he stated dealt with a similar matter. Counsel for the Appellants replied, respecting the motion, that evidence had first to be introduced to determine whether or not the work was a work of repair or a work of improvement. He agreed that such a consideration was central to the Appeal, but argued that a decision could not be made until all the evidence had been heard. The Drainage Referee advised that he would reserve judgement on the motion until all the evidence had been heard, but granted a minor amendment to the pleadings requested by Counsel for the Township of Romney.

The Tunnel Drain is unique, historic and of great interest, not only to those who use it, but to many observers in Kent County. It was first constructed in 1908 pursuant to a Drainage Report prepared by the well known Drainage Engineer, J.J. Newman, P.Eng. It serves approximately 4,000 acres of highly productive cash crop farmland in a watershed, which traditionally flowed to the north toward Lake St. Clair. The Tunnel Drain allowed the flow to be reversed towards Lake Erie, which is a short distance away, carrying the flow approximately 40 feet below the surface of a clay ridge. The tunnel itself was lined with two rings of mortar brick supported by a formed concrete entrance and outlet. The tunnel, which was slightly undersized, has stood up remarkably well through nine decades with little more than random patchwork repairs to its interior. In February of 1993, Ed Dries, P.Eng. had prepared and filed with the Township a new Report, updating and revising the assessment with respect to the Tunnel Drain Watershed.

In the late spring or early summer of 1993, the Council of the Township of Romney, on a routine inspection, discovered that a cave-in had occurred at the north end of the tunnel. The local assessed owners were very apprehensive not only because the actual flow through the tunnel was significantly reduced, but also because of the possibility that a total collapse could seal the outlet, causing untold damage to the productive cash crop farms in the watershed. It was also realized that if the tunnel did collapse the cost of an alternative outlet would be very expensive. The Council of the Township of Romney promptly requested that their Drainage Engineer, Ed Dries, P.Eng. inspect the tunnel and prepare recommendations which he did in a letter to the Township dated the 11^th day of August 1993. Mr. Dries made a proposal which he indicated could be undertaken by Goodreau Excavating Limited, which provided for the repair of the cave-in area from above by means of excavation at a total cost of about $25,000.00. In his letter, he recommended that some degree of internal remediation be undertaken for approximately 100 feet from the inlet. He stated:

“We view this repair work as a reasonably difficult project. The depth of the excavation, the age of the structure, the uncertain condition of the tunnel walls in the failure area and the necessity to complete the internal shoring in a confined space, while maintaining drainage capabilities, all contributed to the difficulty and complexity of the task”…

…”If the repairs are undertaken as a work of maintenance under the governing by-law, there may be legal challenges as to the authority of the municipality installing a tunnel lining system which does not produce a cross sectional area as specified in the by-law”.

It should be noted that Mr. Dries directed the attention of Council to two important concerns, namely:

(a) The complexity and difficulty of the work; and

(b) The consideration that any tunnel lining system might raise legal problems if treated only as a work of repair.

At a Council meeting held on August 16, 1993, the Tunnel Drain Repairs were considered by Council. After Mr. Dries had given his Report, many assessed owners who were present expressed their opposition to excavation work above the tunnel and recommended all repairs be done in a traditional fashion from inside. It was also agreed to postpone bids until Friday, August 20, 1993 at which time alternative bids could be considered. After a further postponement, Council received more bids and the matter was considered at a Council meeting on September 8, 1993. Three proposals were on the table and the A. Rivard Excavation Limited proposal providing for repairs from the inside was accepted. Many effected ratepayers were present during these proceedings and Council took a straw vote of those present and it appears that the vote was unanimous in favour of the A. Rivard Excavating Limited proposal at a total cost of $8,500.00 (plus G.S.T.).

A. Rivard Excavating Limited completed the work with respect to the cave-in to everyone’s satisfaction, but a further matter raised at the September 8, 1996 meeting subsequently became a matter of considerable controversy and is the subject of this appeal. At that meeting an assessed owner, A. Authier advised that in his opinion 750’ of tunnel should be repaired as soon as possible. Mark Rivard, who was also present informed Council that he knew of a contractor who could apply a layer of gunite to the walls of the tunnel anchored by a wire mesh at an estimated cost of $6.00 per square foot.

Randy Robertson, the first witness for the Appellants, testified that after the September meeting he did not hear further concerning the tunnel repairs until he read in the paper that a contract had been awarded in August of 1994 for the purpose of doing further work on the tunnel. He and many other assessed owners then appeared before Council and expressed their objection to the work proposed to be done by Bartlett Restoration.

At that Council meeting held on August 15, 1994, Council adopted a motion that they reconsider the adoption of the Bartlett Restoration proposal. The following day, at a Council meeting on August 16, 1994, Council, after having received legal advice from their Solicitor that they were legally bound by the Bartlett Restoration contract, decided they had no alternative but to proceed to allow Bartlett to do the work. Council instructed the Clerk to conclude a written contract with Bartlett to have the work done for approximately $32,000.00. Mr. Robinson further advised in his testimony, that the work was done in a matter of six days by five workers which consisted of plastering the entire circumference of the tunnel for the first 100’, plastering the bottom half of the tunnel for an additional 50’ and plastering the walls on either side of the tunnel for an additional 300 feet – 2 feet in height at the 7 o’clock and the 5 o’clock areas of the circumference. Mr. Robinson was of the opinion that the material put on by Bartlett was too thin and would not withstand the stress associated with high water flows. Mr. Robinson concluded by saying that he was disappointed with Council because although they had communicated and sought input from the assessed owners with respect to the first repair job, that they had concluded the second contract in relative secrecy and as a consequence had wasted the assessed owners’ funds. Several other assessed owners also testified supporting the evidence of Mr. Robinson. Mr. Alfred Authier calculated that if the gunite proposal which had previously been put forward by Mark Rivard at the September 1993 meeting, had been accepted, then approximately 450’ of tunnel could have been totally covered in all its circumference by a one inch thick concrete mixture applied by the gunite process and anchored by a wire mesh for the sum of approximately $38,000.00. He believed that this would have been superior to the limited and thin plaster job done by Bartlett.

Terry Shank, an assessed owner, also testified for the Appellants, indicating that he had been personally involved in the cave in repair work and hence had an opportunity to observe the condition of the tunnel. He indicated that the patches that had been done over the years held up very well, but there are some areas, particularly near the inlet, where one layer of brick had disappeared as a result of erosion and turbulence.

Mr. Shank entered pictures of the interior of the tunnel, which illustrated that some of the lining put on by Bartlett Restoration was already disappearing from the walls of the tunnel. He also entered as Exhibits portions of the plaster that had been put on the wall by Bartlett Restoration which he had picked off of the wall or which he said was already detached. These examples, he believed, illustrated how thin the material was and how little fiber was present in the material. He concluded by saying that he saw no evidence of the anchoring screws, which were to be installed by Bartlett Restoration.

The Appellants called Donald McGeorge, P.Eng., an Engineer of great experience, as their expert witness. He advised that he had conducted an investigation of the tunnel which had been originally constructed of Chatham Brick. He indicated that he had observed the old repair patches and that they were holding up remarkably well. He identified the previous exhibits of lining plaster which he observed had an average depth over good surfaces of ¼ to ½ inch. He stated that in his professional opinion the work done by Bartlett Restoration Limited went beyond that of mere repair and therefore it constituted an improvement. He stated that in his opinion it was an attempt to reline the tunnel for a specified distance of 450’ covering all service areas on either side of the tunnel to a height of approximately 2 feet whether such surface areas needed repair or not. He stated that if this work was limited to mere repair it would involve spot repairing and possibly replacing brick only in areas where such work was required. In these circumstances, where all surface areas were covered, the result was to improve and smooth the surface so that the flow would be increased and such work could only be characterized as an improvement. He also stated that pursuant to the Drainage Act, such work ought to have been done after a Drainage Report and under the supervision of a Drainage Engineer. In his opinion, proper research was required to ensure that the concrete applied would adhere to the brick surface. He pointed out that normally gunite and plaster are applied to concrete surfaces.

Mr. McGeorge further noted that the pictures filed as Exhibits disclosed that the plaster put on by Bartlett Restoration was disappearing. He stated the Bartlett work was a waste of drainage money and considerable expense might be incurred in the future in removing it so as to apply a proper lining to the tunnel. Mr. McGeorge concluded by saying that in his professional opinion, based on his experience, this work ought to have proceeded pursuant to Section 78 of the Act with an Engineering Report, the usual notices and rights of appeal.

Counsel for the Township of Romney called as his first witness the Clerk of the Township, Mr. Earl Waites. Mr. Waites outlined the procedures leading up to the repair of the cave-in in 1993 and his evidence substantially agreed with that presented to the Referee by previous witnesses. However, in one area his testimony differed from that of the other witnesses, namely his clear understanding that the owners did not wish to have a Drainage Report prepared with respect to the work to be done. Mr. Waites advised that Council did not receive the gunite proposal until early in 1994 and considered it for the first time on the 6^th day of June 1994. He stated that the Drainage Superintendent, Richard Dibley reported to Council that, “in his opinion 400 feet from the north end of the drain should be repaired with concrete, mainly at the 5 o’clock and 7 o’clock positions. The first layer of some bricks are missing and others have come loose”.

Based on the Report of the Drainage Superintendent, Council asked that estimates for the work be obtained and that a public meeting be arranged with the assessed owners to both inform them of Council’s intentions and of the cost.

The Clerk went on to advise that the Drainage Superintendent had taken various drainage contractors to examine the tunnel and to make bids. These bids were considered at a subsequent meeting of Council on July 11, 1994 where the Clerk anticipated that the assessed ratepayers would be present in numbers. At the meeting, no concerned ratepayers were present. They had not been notified.

Council considered three proposals which had been obtained by the Drainage Superintendent ranging from $32,581.00 to $39,500.00 and accepted the lowest proposal of Bartlett Restoration Limited.

The Clerk advised that the Custom Gunite Contractors Ltd. proposal was not considered by Council for the following reasons:

There was no total price (price was based per square of usage).
Council would be responsible for drilling at least two holes from the ground level to the tunnel through which cement would be delivered.
Council would have to provide water at the site.
Council would have to provide entrance access which might involve dyking.

He stated that Council was also concerned about the accuracy of the drill holes and the impact that such holes might have on the integrity of the tunnel roof.

The resolution of Council adopting the Bartlett proposal was confirmed by Procedural By-law No. 41-1994 which was a General Purpose By-law to confirm all acts and decisions made by Council during the July 11, 1994 Council meeting.

The Clerk went on to advise that many assessed owners were present at the subsequent August 15 Council meeting, having been notified by way of the newspaper of the Bartlett Restoration contract.

The Clerk stated that on August 15, 1994, the large delegation expressed their disappointment with the Bartlett contract. Council then made a motion to re-consider the letting of the contract and to hold a public meeting. However, after receiving a legal opinion, Council then decided to proceed with the Bartlett contract sending out an information letter to the ratepayers. By-law 58-1994 was passed assessing out the cost of the work, which after grants cost the total sum of $17,550.00. The Clerk, during cross-examination by Mr. Taylor, admitted that Council believed that the gunite proposal, “would be considered an improvement and not a repair”. He stated it was the view of Council that the application of a concrete cover for 400 feet at only the 5 o’clock and 7 o’clock positions in the tunnel was considered to be a work of repair and in the view of the Drainage Superintendent that was all the work that was required.

Ed Dries, P.Eng., a Drainage Engineer with considerable experience, appeared and gave expert evidence on behalf of the Township of Romney. He advised that in July of 1993, at the request of Council, he had investigated the cave-in of the tunnel. He confirmed he provided a letter of advice to Council dated August 11, 1993 which letter made several recommendations. These included:

(a) A direction that the work be done immediately;

(b) A suggestion that the work was complex and required expertise;

(c) He warned, “that if the repairs are undertaken as a work of maintenance under the governing by-law there might be legal challenges; and

(d) Finally, he recommended that the work be done by means of surface excavation down to the top of the tunnel.

He subsequently attended a Meeting of Council to consider the repairs where he noted that most of the owners were concerned with the structured integrity of the tunnel. At that meeting, he advised that he did not believe a Drainage Report was required.

Mr. Dries further stated that he had been requested by Council to inspect the tunnel after the work had been completed and did so on April 11, 1996. He noted that some of the Bartlett lining was not adhering to the walls of the tunnel in areas where the lining was thin over good brick, but in areas where repairs were required and where the lining had much greater depth it was properly adhering. He went on to state that in his opinion the work fell within the definition of “maintenance”, namely “the preservation of the drainage works”. In his view, he stated the work was not an improvement because no hydraulic change had resulted. The cross section of the tunnel in his view may have been slightly decreased, but the smoother surface provided by the lining material would have off set any restrictions in flow. He stated that the material proposed to be used in the gunite application and that used by Bartlett were essentially the same. He stated that he believed that a new type of material could be used to effect repairs as long as the result was restoration to the same dimensions.

The Drainage Engineer for the Township of Romney concluded his evidence by stating that the work that was done was all that was necessary for repair and that no work was required to be done on the ceiling of the tunnel.

SUBMISSION:

Mr. Taylor, in his submissions, argued on behalf of the Appellants that the central issue before the Referee was whether the work undertaken by Bartlett Restoration in the tunnel was a matter of repair or improvement. He argued that the expert witness, Mr. McGeorge, had clearly defined it as a matter of improvement as opposed to the type of repair work traditionally carried on in the past where spot repairs had been done to the tunnel. Consequently, he argued the work should have been pursuant to Section 78 of the Act which would have required an Engineering Report and the traditional input from the assessed owners.

He went on to state that if the Referee did find that the work was one of repair that procedural errors had been made and that a Provisional By-law ought to have been passed. He pointed out that Section 75 required the Provisional By-law to provide:

(a) A description of the work;

(b) The extent of the work; and

Mr. Taylor referred to an Ontario Drainage Tribunal Decision dated June 22, 1992 dealing with the repair and maintenance of the Johnson Drain in the Township of Raleigh, wherein the Chairman stated that when a municipality is doing the work pursuant to Section 78:

“It is a condition precedent for doing work under Section 75 that a By-law be passed”.

He went on to argue that the omnibus by-law passed at the conclusion of the Council meeting confirming all proceedings and resolutions of that meeting was not a satisfactory substitute for the By-law required under Section 75 of the Drainage Act.

Mr. Taylor proceeded by stating that the failure to act pursuant to Section 78 had the unfortunate result of:

(a) Failing to give the assessed owners adequate notice of the decisions of Council (despite the excellent consultation that had previously taken place with respect to the earlier repair work);

(b) It resulted in the type of work being done that the assessed owners objected to;

(c) It raised doubts as to whether the work was cost effective and in particular whether other contracts would have provided greater value for money expended;

(d) It raised the unfortunate suspicion that Council was acting in secrecy with respect to this matter.

Mr. Taylor concluded by requesting that the by-law be set aside – providing the Provincial Grant was not in jeopardy as a result. He further asked that costs be awarded in favour of the Appellants against the Municipality on a solicitor – client basis as opposed to being assessed against the drainage work.

Mr. Robinson, in his submissions, agreed that the major issue was whether or not the work undertaken was one of improvement or one of repair as defined by the Drainage Act. He stated that the words in Section 78 (1) of the Act “or otherwise improved” must be incorporated into the contents of the entire Section and therefore the improvement referred to must be a genuine improvement of the works. He referred to the definition section of the Drainage Act where the word “improvement” is defined as follows:

“Being any modification of or addition to a drainage work intended to increase the effectiveness of the system”.

He argued that pursuant to this definition an improvement required a complete lining of the tunnel. He disagreed with the definition given by Mr. McGeorge that defined an improvement as “anything that made the works better than it was before”. He noted that Mr. Dries had advised that the work done would result in a negligible increase in efficiency of flow.

Mr. Robinson stated that the burden of proving that the action of Council was illegal was upon the Appellants. He pointed out that the assessed owners had wanted to have the cheapest work done and had wanted to have the work done without the use of a Drainage Engineer. He noted there had been plenty of input from owners in the fall of 1993 and that the final decision was made at a regular Council meeting in July of 1994. Council had attempted to reconsider their actions in August of 1994 and proceeded only after they had been advised by their Township Solicitor that they could not withdraw from the Bartlett Restoration contract. Mr. Robinson went on to argue that it was not necessary for the Township Council to pass a by-law, that a resolution was adequate in terms of municipal procedure for this purpose. He referred to the case of Peter Bodnarchuk and the Township of Gwillimbury decision of Judge Clunis to support the proposition that Council can undertake a matter of repair without the report of an engineer and without notice to the assessed owners, etc.

ISSUE:

The issue for determination in this case is whether or not the work done by Bartlett Restoration in this historical tunnel was a work of improvement or a work of repair as defined by the Drainage Act, R.S.O. 1990 D.17. If it was a work of improvement Council ought to have proceeded pursuant to Section 78 of the Act (because the cost of this work exceeded the cost limitation in Section 77), by retaining an engineer and proceeded “as on a Report for the construction of a drainage works”. If, on the other hand, this was merely a repair made to an existing work, then in that case the municipality was authorized to proceed under Section 75 of the Act without the Report of an Engineer and unless another municipality is involved they need not serve notice of the provisional by-law. Although I am not compelled to make a determination of the procedural correctness of the omnibus by-law in this case I would like to comment that it is always wise for any municipality proceeding under Section 75 to do so by way of a provisional by-law.

Section 1 of the Drainage Act defines an “improvement” as follows:

“An improvement means any modification of or addition to a drainage works intended to increase the effectiveness of the system”.

Section 1 defines “repair” as:

“A repair means the restoration of a drainage works to its original condition”.

Clearly, the matter of whether a drainage works constitutes one of improvement or merely a repair is a factual determination.

FACTS:

The Referee found that the work completed by Bartlett Restoration consisted of plastering of the tunnel wall with a modified concrete mortar by hand over the entire interior surface of the tunnel for its whole circumference for a distance of 100’; thereafter for an additional 50’ the bottom half of the entire tunnel was plastered and for an additional distance of 300’, the surface of the tunnel was plastered only at the 7 o’clock and 5 o’clock positions. The plaster covered areas where the brick had deteriorated and in these particular spots it might have had a depth of several inches while on the remainder of the surface where the brick had not spalled it would have a thickness ranging from ¼” to ½”. No evidence was provided to indicate that tap-sealing screws were installed as a mechanical anchor although provision had been made for the same in the Bartlett Restoration estimate. The evidence further indicated that significant patches of the material had washed away as a result of spring flows in the tunnel.

EXPERT EVIDENCE:

Mr. McGeorge, P.Eng., testified as previously outlined that it was a work of improvement rather than repair and that in his opinion much of the material would soon wash away. Accordingly, he believed that the assessed owners did not receive good value for the money paid. On the other hand, Mr. Dries, P.Eng., in his evidence testified that in his opinion the work was clearly one of repair and that the assessed owners had received good value for the monies expended.

CONCLUSIONS:

The Referee concludes after considering all the evidence that this was in fact an improvement to the tunnel and more than a mere work of repair. The Referee acknowledges that this is a marginal determination and the circumstances of this case are borderline. It was, however, stated by both Engineers that there would be a slight improvement in the velocity of the flows because the smooth surface will create less friction. It was conceded that until the entire tunnel is resurfaced in this manner that no real advantage will accrue. If the entire tunnel had received a lining of this nature, it would more clearly have been visualized as an improvement.

There are certain other factors which influenced the Referee in deciding that this work had the character of an improvement rather than a repair.

The first was the complexity of the undertaking, which was first referred to by the Township Engineer in his letter of August 19, 1993 and was reinforced by the concerns of the owners expressed at several meetings with Council.

The second was the estimated cost, which ranged from $32,000.00 up to as much as $50,000.00.

Section 75 of the Drainage Act is designed to permit a municipality to undertake a simple project of repair without an Engineer’s Report. The difficulties encountered by Council in determining which process to proceed with in this matter speak to the fact that the assistance of an engineer would have been helpful.

The cost of the contract also presented problems as reflected in the complaints by the assessed owners with respect to the tendering process. Section 77 of the Act sets out a maximum of $4,500.00 as being the level of improvement which can safely be undertaken by Council without the report of an engineer. Section 75 also deprives owners of the necessary information, input and rights of appeal which are afforded in projects pursuant to Section 78. It must be remembered that Council has a unique obligation in maintaining drainage works because it is entrusted to administer funds of both the assessed owners and of the Provincial Government as a fiduciary.

This particular matter in which a large contingent of assessed owners appeared at the Hearing and expressed their anger with the procedures followed illustrates why the extended procedures in Section 78 ought to have been followed. The Drainage Act, with its compiled historic wisdom has been designed to ensure that engineers, not councils, make engineering decisions. It also requires detailed engineering reports, so that contractors will have no difficulty in submitting their bids on a level playing field.

Finally, Section 78 permits maximum input, notice and right of appeal by the assessed owners. Section 75 of the Act bypasses all of the above procedures and it is only justified when simple repairs must be made with the least expense and in a timely fashion. However, in cases of complexity and greater expenses, Section 78 procedures must apply where any uncertainty exists.

In accordance with the above mentioned reasons I hereby Order:

(a) That the preliminary motion made by R.G. Robertson to dismiss the Appeal be itself dismissed.

(b) That By-law No. 62-1993 of the Township of Romney be amended to provide that the assessments on private lands be reduced by 40% and that sum be paid out of the general revenues of the Township of Romney.

(c) That the Appellants be awarded costs fixed in the total sum of $1,500.00 payable by the Corporation of the Township of Romney.

DATED: October 21, 1996

DELBERT A. O’BRIEN, Q.C.

ONTARIO DRAINAGE REFEREE

Court File No. 4154 / 95

THE COURT OF THE DRAINAGE REFEREE

BETWEEN:

ALFRED AUTHIER, JAMES ROBINSON, SHANKS SEEDS LTD. and OTHERS

APPELLANTS

-AND-

CORPORATION OF THE TOWNSHIP OF ROMNEY

RESPONDENT

AMENDMENT TO DECISION

Whereas an error was made by the Referee on Page 17 of the Decision dated October 21, 1996 in this matter;

It is therefore Ordered that an amendment be made to Clause (b) outlined on Page 17 of the said Decision dated October 21, 1996 by striking out “By-law No. 62-1993” and replacing the same with “By-law No. 58-1994”. Accordingly, Clause (b) should read as follows:

(b) That By-law No. 58-1994 of the Township of Romney be amended to provide that the assessments on private lands be reduced by 40% and that sum be paid out of the general revenues of the Township of Romney”.

That no other changes in the Decision are to be made.

DATED: November 25, 1996

DELBERT A. O’BRIEN, Q.C.

ONTARIO DRAINAGE REFEREE

Authier v. Romney (Township), 1996 ONDR 1

Case Summary

APPELLANTS

RESPONDENT

DECISION

THE COURT OF THE DRAINAGE REFEREE

APPELLANTS

RESPONDENT

AMENDMENT TO DECISION