ONTARIO
SUPERIOR COURT OF JUSTICE
IN THE COURT OF THE DRAINAGE REFEREE
Hayter v. Bluewater (Municipality) 2005 ONDR 1
DATE OF DECISION: 2005-05-09
2005-01
STATUTE: Drainage Act
HEARING: 2004-02-24
BETWEEN: LOIS HAYTER AND W. GLENN HAYTER APPELLANTS
-AND - AUSABLE PRODUCE COMPANY (1047588 ONTARIO LIMITED)
- AND - THE COUNCIL OF THE MUNICIPALITY OF BLUEWATER RESPONDENTS
D E C I S I O N
This matter proceeded before the Ontario Drainage Referee in a hearing which commenced on the 24th day of February 2005 in the Goderich Court House at 10:00 a.m. The hearing resulted from an appeal filed by the Ausable Produce Company requesting a review of the Referee’s Order dated January 16th, 2004. That appeal was filed following a Notice sent out by the Clerk Janisse Zimmerman of the Municipality of Bluewater to all assessed owners, a copy of which is attached hereto in full because it clearly outlines background circumstances which gave rise to the appeal.
Court File No. 103-02
ONTARIO SUPERIOR COURT OF JUSTICE IN THE COURT OF THE DRAINAGE REFEREE
AND IN THE MATTER OF an investigation under the authority of Section 78 of the Drainage Act of the private structure described as a gate, or dam structure, in Lot 11, Concession 7 in the geographic Township of Hay, now in the Municipality of Bluewater, and located on the WEST BRANCH of the BLACK CREEK MUNICIPAL DRAIN
BETWEEN:
LOIS HAYTER and W. GLENN HAYTER Appellants
- and -
THE CORPORATION OF THE MUNICIPALITY OF BLUEWATER Respondent
NOTICE OF RIGHT OF APPEAL OF ORDER REQUIRING A SECTION 78 DRAINAGE REPORT
This Notice is being given to the owners of all properties assessed into the West Branch of the Black Creek Municipal Drain in the following circumstances:
The Drainage Referee (the “Referee”) issued a decision dated January 16th, 2004 following his hearing of appeals by Lois Hayter and W. Glenn Hayter (the “Hayters”) from decisions of the Agriculture, Food and Rural Affairs Tribunal (the “Tribunal”) made by the Tribunal in 2002.
A copy of the Referee’s decision is attached to this notice.
The Tribunal’s and the Referee’s decisions were in relation to the East Branch of the Black Creek Municipal Drain, as opposed to the West Branch of the Black Creek Municipal Drain.
During the Referee’s hearing of the Hayter appeals, the appellants presented concerns about the effects of a gate, or dam structure, constructed in the West Branch of the Black Creek Municipal Drain at a location in Lot 11, Concession 7 in the geographic Township of Hay.
No notice of the Tribunal’s nor of the Referee’s hearing of the Hayters’ appeals was given to all those assessed into the West Branch of the Black Creek Municipal Drain.
The most recent Report under the Drainage Act on the West Branch of the Black Creek Municipal Drain is dated September 18th, 1987 and was issued by Mr. Will J. Bartlett, P.Eng. (The “1987 Bartlett Report”.)
During the Referee’s hearing, a suggestion was made that an investigation of such gate, or dam structure, could be undertaken pursuant to section 78 of the Drainage Act and, in that connection, the Referee made the following Finding, on page 31 of his decision:
The Referee was impressed with the testimony of Mr. Dries who indicated that the gate (dam structure) ought to be investigated, but that the process should involve a Section 78 report independent of the preliminary report involving the East Branch. The structure was installed without a full report and therefore remains a private structure in the drain outside of the control of the Municipality. Further, it appears that the structure has exceeded the specifications suggested by Mr. Bartlett in his letter to the Municipality which letter also contemplates that it would only be a temporary structure. A report should not prove to be costly if shared by all of the owners in both the West and the East Branch. The results of such a report would remove the uncertainty which has disturbed upstream owners and would allow for remedial action if necessary. I therefore have come to the conclusion that a separate report would be in the interest of all the assessed owners. The Referee in making an Order that the Municipality appoint an engineer pursuant to Section 78 to investigate the impact of the structure on the performance of the drain will allow an opportunity for any assessed owner to file an appeal with respect to that decision of the Referee.
In implementation of that Finding, the Referee made the following Order on page 33 of his decision:
That the Municipal Corporation of Bluewater proceed to appoint the drainage engineer of their choosing to prepare a drainage report pursuant to section 78 of the Drainage Act to investigate the impact of the private drainage structure described as the gate (dam) in Lot 1, Concession 7 of the West Branch with a view to enacting a By-Law to legalize the existence of the structure. This portion of the Order shall be sent to all assessed owners advising them that if they disagree with the terms of this Order they will have an opportunity to appeal and have the matter reviewed by the Drainage Referee at a time and place fixed for the hearing. Such notice is to be prepared by the counsel for the Respondent and forwarded to the Referee for approval at which time it will include a time, place and date for the proposed Hearing.
THE PURPOSE OF THIS NOTICE is to give you, as the owner, according to the last revised assessment roll, of land which is assessed into the West Branch of the Black Creek Municipal Drain under the 1987 Bartlett Report, an opportunity to appeal to the Drainage Referee from his decision to order Bluewater to appoint a drainage engineer to prepare a drainage report pursuant to section 78 of the Drainage Act to investigate the impact of the private drainage structure in Lot 1, Concession 7 of the West Branch with a view to enacting a By-Law to legalize the existence of the structure.
If you wish to have the Referee review such Order, you are required to give notice of your request in accordance with the following:
(a) The request must be in writing and include the name and address of the person making the request, the property assessed into the West Branch on behalf of which the request is being made and an address for service.
(b) The request must be delivered to the Municipality at its 14 Mill Avenue offices in Zurich on or before January 4th, 2005.
If one or more requests for such a review are received by January 4th, 2005, the Referee will then appoint a time date and place for a review hearing. The purpose of the review hearing will be to re-consider the Referee’s Order directing the appointment of a drainage engineer to prepare a drainage report pursuant to section 78 of the Drainage Act. Notice of that review hearing will be given to all those assessed into the West Branch of the Black Creek Municipal Drain.
If no request for review is received, then the Municipality will proceed with the appointment of a drainage engineer to prepare a drainage report pursuant to section 78 of the Drainage Act as ordered.”
Issues to be Decided:
a) The first issue to be determined by the Drainage Referee was whether or not the Order contained in his decision of January 16th, 2004 wherein he ordered that a section 78 report be commissioned by the Municipality be rescinded.
b) The second issue before the Drainage Referee was the question of costs, both as to the amount claimed, the apportionment of costs between the parties and as how the costs should be assessed and collected.
THE APPEAL OF AUSABLE PRODUCE WITH RESPECT TO SECTION 78 ORDER
Catherine Kwartiak appeared on behalf of Ausable Produce identifying herself as both a Director and the Secretary of the company. She advised that the company she represented would remove the subject gate (dam) located at Lot 11, Concession 7 in the Geographic Township of Hay by the 1st day of May 2005. She advised that company officials had decided to remove the gate altogether from the drain primarily because of their inability to satisfy what she considered to be the unrealistic demands of the Department of Fisheries and Oceans. She advised that at the time of installation the gate a motion of Council had approved (dam) and that a letter had been received from the drainage engineer W. J. Bartlett outlining the required specifications. She further advised that to her knowledge there had been no complaints made by any other landowner along the course of the drain with the exception of Mr. Hayter. She noted that their potato crops had previously been flooded by flood waters which in her opinion exclusively the drain from upstream lands had delivered.
SUBMISSIONS OF COUNSEL WITH RESPECT TO THE APPEAL FROM THE SECTION 78 ORDER
Counsel for the Respondents:
Mr. Wright advised the Drainage Referee that in his opinion it would not be necessary to proceed with the Order for a Section 78 report in the circumstances if the gate was entirely removed from the dam. He advised that the Drainage Referee might withhold a final decision until the gate was removed or might provide a conditional Order. He further suggested that any engineer appointed might after reviewing the situation make an Order pursuant to Section 40 of the Drainage Act to the effect that a full report was not required. He concluded by stating that the Municipality was firmly of the opinion that a full report was not required in the circumstances providing the gate and supporting structures were removed from the drain.
Counsel for the Appellants:
Mr. Langlois was of the opinion that a full Section 78 report was still required. He was of the opinion that a drainage engineer to assess its adequacy should review the gate and culvert. He advised that in circumstances where the Municipality has legalized the structure a full report of an engineer should be required to effect its proper removal.
HEARING WITH RESPECT TO ISSUE OF COSTS
Submission of Counsel for Respondent:
Mr. Wright advised that he was not contesting the details of the Bill of Costs filed by Mr. Langlois. He further advised that in normal circumstances the theory of drainage procedure was to charge the administrative costs to the account of the drain to be shared by all of the assessed owners. He noted that only in rare occasions are costs charged to the general rate of the Municipality. The rate charged by Mr. Wright who had practiced law since 1973 was an hourly rate of $220.00. He charged for his junior at the rate of $140.00 per hour. The Bill of Costs filed by Mr. Wright provided for total costs including disbursements at the partial indemnity scale of $24,739.88 representing costs until March 2004.
Mr. Wright argued that costs should be apportioned as follows:
The $6,000.00 held on deposit by the Municipality ought to be released to the Municipality and be applied to the $24,739.88 reducing that amount to approximately $18.000.00. That amount he argued should be assessed against the appellants to be paid to the Municipality. The balance of $10,000.00 (representing the full amount payable by the Municipality if paid at the full indemnity rate) he argued should be charged to the drain and more particularly the East Branch.
Mr. Wright justified his submission by stating that the Appellants did not win the appeal. He noted that the Municipality had conceded at the outset that the Tribunal (drainage) had acted improperly and that an appeal with respect to the failure of adequate notice to the Appellants was justified. Therefore he maintained that the Appellants could not claim victory with respect to that issue. Mr. Wright further argued that during the hearing the Appellants had renewed their claim that a Preliminary Report should be ordered with respect to the East Branch. On that point the Appellants were unsuccessful and therefore the Appellants ought to bear a significant portion of the costs of the hearing. In all the circumstances Mr. Wright argued that it would be grossly unfair to award costs to the Appellants for the aforesaid reasons.
In conclusion Mr. Wright advised that the Municipality had incurred a further $6,500.00 in costs since the Bill of Costs had been prepared approximately $3,000.00 of which he suggested should be assessed to the West Branch relating to the current hearing. The balance of $3,000.00 ought to be, in his opinion, assessed on partial indemnity basis to the Appellants, namely the sum of $2,000.00.
Submissions of Counsel for the Appellants:
Mr. Langlois referred in his submission to the history of the drain. He noted that in 1997 and 1998 the Hayters had requested that repairs be conducted, but the Municipality had refused. Mr. Hayter had then retained Maitland Engineering to conduct a survey in 1999. Mr. Langlois stated that the partial cleanout then ordered by Council had not required construction specifications of the contractor. Mr. Hayter therefore had appealed to the Drainage Tribunal and an Order was made to provide a Preliminary Report. However, the engineer chosen by the Municipality, Mr. Grahlnan was terminated prematurely by the council and in Mr. Hayter’s opinion, this resulted in significant further costs. Mr. Langlois argued that because of the above-mentioned errors made by the Municipality that “huge” extra expenses had been incurred.
Mr. Langlois noted that all parties had agreed that an appeal of the supplementary decision of the Tribunal was justified. Therefore Mr. Hayter had a legal right to appeal.
Mr. Langlois further argued that the Appellants were successful in having a favorable decision with respect to the gate (dam) located in the West Branch. He argued that that matter had been ignored by the Tribunal and had been considered by the Drainage Referee in ordering a Section 78 report.
Mr. Langlois concluded by stating the Appellants were successful because:
a) The appeal was allowed;
b) The decision of the Agricultural, Food and Rural Affairs Appeal Tribunal was set aside;
c) An Order was made to review the impact of the drainage structure in the West Branch through a Section 78 report.
d) Although, the Preliminary Report was not ordered to proceed with respect to the East Branch the evidence that supported such a determination was provided by the drainage superintendent Mr. Haggett which evidence had not been available previously.
e) The Drainage Referee noted in his Decision that further work on Highway 84 could be undertaken as a matter of repair.
For the above-mentioned reasons he argued that costs ought to be awarded to the Appellants. He further argued that payment of costs should be made from the general revenues and not be assessed against the land owners. He concluded by submitting that because of the conduct of the Municipality costs should be awarded on a substantial indemnity basis. Consequently costs in the amount of $35,000.00 ought to be awarded to the Hayters and the deposit of $6,000.00 held by the Municipality ought to be returned to the Appellants.
FINDINGS OF FACT & LAW
The Drainage Referee accepted the evidence of the spokesperson for the Appellant, Ausable Produce as being totally credible when she advised that the company she represented would remove the offending gate (dam) which it had installed in the West Branch of the Black Creek Municipal Drain. The Drainage Referee had previously ordered the Municipality to engage a drainage engineer solely for the purpose of (1) investigating the said structure to determine whether it presented an obstacle to drainage and (2) if not to legalize its existence by means of a Drainage Report. Its removal by Ausable Produce rendered both reasons mute.
With respect to the second issue namely the matter of legal costs the Drainage Referee found the success of the Parties in the previous hearing to be divided. The Appellants Hayter was successful to a limited degree in:
a) Having the appeal allowed.
b) Having the decision of the Tribunal set aside.
c) Having an Order made to have an engineer appointed pursuant to Section 78 to examine the gate (dam) in the West Branch.
d) Having the Drainage Referee draw attention to the fact that the condition of the bridge located at Highway 84 ought to be investigated as a matter of repair.
However, the Drainage Referee is of the opinion that the above-mentioned success of the Appellants was mitigated considerably by the conduct of the Municipality in:
a) Conceding at the outset that the appeal ought to be allowed.
b) Conceding at the outset that the decision of the Drainage Tribunal ought to be set aside.
c) Conceding at the outset that an engineer ought to be appointed pursuant to Section 78 of the Drainage Act to examine the gate (dam) in the West Branch of the Black Creek Municipal Drain.
On the other hand the success of the Municipality in having the Drainage Referee find that there was no need to proceed with a Preliminary Report with respect to the East Branch was somewhat offset by the fact that the critical evidence presented by the Drainage Superintendent, Patrick Haggitt as to the current condition of the East Branch immediately before the hearing was not available to the Appellants at the time that he commenced his appeal.
For the above-mentioned reasons I find that the success of the Parties to be decidely mixed.
I further find that as a matter of law that the Rules of Civil Procedure as more particularly set forth in Rule 57 Costs of Proceedings have application in the Court of the Referee therefore serving as a guide in apportioning costs.
For that reason I therefore set out Rule 57 herein completely.
“ RULE 57 COSTS OF PROCEEDINGS
- GENERAL PRINCIPLES
Factors in Discretion
57.01 (1) In exercising its discretion under section 131 of the Courts of Justice Act to award costs, the court may consider, in addition to the result in the proceeding and any offer to settle or to contribute made in writing,
(a) the amount claimed and the amount recovered in the proceeding;
(b) the apportionment of liability;
(c) the complexity of the proceeding;
(d) the importance of the issues;
(e) the conduct of any party that tended to shorten or to lengthen unnecessarily the duration of the proceeding;
(f) whether any step in the proceeding was,
(i) improper, vexatious or unnecessary, or
(ii) taken through negligence, mistake or excessive caution;
(g) a party’s denial of or refusal to admit anything that should have been admitted;
(h) whether it is appropriate to award any costs or more than one set of costs where a party,
(i) commenced separate proceedings for claims that should have been made in one proceeding, or
(ii) in defending a proceeding separated unnecessarily from another party in the same interest or defended by a different solicitor; and
(iii) any other matter relevant to the question of costs.
Counsel for the Appellants and for the Respondent filed with the Court a complete Bill of Costs both partial indemnity and substantial indemnity scale. The Court has previously found that only in very exceptional circumstances where the conduct of a party could be found to be vexatious, malicious or totally irresponsible would costs on a substantial indemnity basis be awarded. Therefore the normal rule is to award costs on a partial indemnity scale in drainage matters. The total costs on an partial indemnity scale filed in the Bill of Costs of the Appellants amounted to the sum of $24,109.11. That sum included disbursements in the sum of $7,430.24. The total costs filed in the Bill of Costs by the Counsel for the Municipality up until the 19th of March 2004 on a partial indemnity scale amounted to $24,739.88 which included disbursements of $4,863.71. Neither legal Counsel challenged the details in the other’s Bill of Costs; and for that reason and because in all the circumstances the Bill of Costs as presented appear to be reasonable and accurate the Drainage Referee is satisfied as to the detail.
The Drainage Referee, having found that the results were clearly divided as to success, is of the opinion that each party should be responsible for its own costs. The costs of the Municipality can be properly assessed to the owners on the East Branch. The costs incurred by the Municipality for the current hearing may be assessed against the owners of the West Branch as well as the owners on the East Branch equally.
With respect to the $6,000.00 deposit held by the Municipality I have decided that in all the circumstances to reflect the division of success as well and therefore apportion that deposit. $3,000.00 of it will be returned to the Appellants and $3,000.00 will be kept by the Municipality and be applied for the cost of the drain on the East Branch. The Referee would like to commend the fact that the Municipality’s Counsel engaged the Drainage Superintendent to obtain further evidence with respect to the condition of the East Branch and the gate (dam) located in the West Branch immediately before the hearing. Such evidence was of critical importance.
ORDER
a) THE DRAINAGE REFEREE HEREBY rescinds the said portion of his decision dated January 16th, 2004 contained in Paragraph 3 wherein the Municipality was ordered to engage a drainage engineer to prepare a report pursuant to Section 78 of the Drainage Act with respect to the gate (dam) in Lot 11, Concession 7 of the West Branch.
b) THE DRAINAGE REFEREE FURTHER ORDERS THAT each party to this hearing will be responsible for his or her or its costs solely, and that the Municipality may recover its costs by assessing the same to the Drain pursuant to the provisions of the Drainage Act. Fifty percent of the costs incurred by the Municipality with respect to the current hearing will be assessed exclusively to the owners in the West Branch.
c) THE DRAINAGE REFEREE FURTHER ORDERS THAT the $6,000.00 deposit paid by the Appellants Hayter and held by the Municipality shall be dealt with as follows:
i) $3,000.00 will be returned to the Appellants the Hayters;
ii) $3,000.00 will be applied by the Municipality for the costs incurred by the Owners for the East Branch of the Drain.
Dated at Pembroke, Ontario this 9th day of May, 2005.
Delbert A. O’Brien, Q.C. Juris D. Ontario Drainage Referee