Ontario Land Tribunal

Tribunal ontarien de l’aménagement du territoire

ISSUE DATE: October 23, 2023

CASE NO(S).: OLT-23-000373

PROCEEDING COMMENCED UNDER section 22(2) of the Development Charges Act, 1997, S.O. 1997, c. 27

Appellant: Greycan 12 Properties Inc. and 12501252 Canada Inc.

Description: Determination of the development charges

Reference Number: DC By-Law 2022-31

Property Address: 23675 and 23965 Woodbine Avenue and 2596 Glenwoods Avenue

Municipality/UT: Georgina/York

OLT Case No.: OLT-23-000373

OLT Lead Case No.: OLT-23-000373

OLT Case Name: Greycan 12 Properties Inc. and 12501252 Canada Inc. v. York (Region)

PROCEEDING COMMENCED UNDER subsection 19(1) of the Ontario Land Tribunal Act, 2021, S.O. 2021, c. 4, Sched. 6

Request by: Regional Municipality of York

Request for: Request for Dismissal Without a Hearing

Heard: August 17, 2023, by Video Hearing (“VH”)

APPEARANCES:

Parties

Counsel

Greycan 12 Properties Inc. and 12501252 Canada Inc. (“Appellants”)

A. Lusty N. Gunawardena

Regional Municipality of York (“Respondent”)

Bola Ogunmefun S. Whalen

MEMORANDUM OF ORAL DECISION DELIVERED BY ROBERT G. ACKERMAN ON AUGUST 17, 2023, AND ORDER OF THE TRIBUNAL

INTRODUCTION

1This Proceeding is an Appeal, pursuant to Section 22(2) of the Development Charges Act, 1997, S.O. 1997, c. D.27, (“the DC Act”) from the non-decision of the Respondent’s Regional Council on a Complaint by the Appellants for a refund of overpaid development charges.

2The Respondent has brought this Motion for costs and for an Order dismissing the Appeal pursuant to Section 19(1)(d) of the Ontario Land Tribunal Act (“the OLTA”) on the grounds that the Appellants failed to file a Complaint within the time prescribed by Section 20(2) of the DC Act. In the alternative, the Respondent seeks an Order defining the issues to be addressed at the Hearing on the Merits of the Appeal as:

1. Was there an error in the application of the Region’s Development Charge By-law No. 2022-31 in determining the development charges payable for the Subject Properties?

2. Was the amount of the development charge payable for the Subject Properties incorrectly determined?

3The Appellants filed a Notice of Response to Motion seeking an Order dismissing the Respondent’s Motion on the grounds that the Appellants filed a valid Development Charge Complaint and for costs. The Appellants also seek an Order that the issues to be determined at the Hearing of the Appeal on the Merits are:

1. Did the determination of the Region’s Development Charge, which included the application of the Region’s Interest Rate Policy, lead to an error in the determination and application of the Region’s Development Charge By-law due to:

a) A contravention of s. 5(1)(4) of the Development Charges Act?

b) A contravention of s. 2(1) of the Development Charges Act?

c) A contravention of s. 5(1)(9), 5(6)(1), and 5(6)(2) of the Development Charges Act?

2. Does s. 26.2(3) of the Development Charges Act authorize imposing the Region’s Development Charge as determined and applied under the circumstance?

3. Should Greycan 12 Properties Inc. and 12501252 Canada Inc. be granted a refund pursuant to s. 25 of the Development Charges Act? If so, what is the correct value of the refund?

4The Respondent’s Development Charge By-law No. 2022-31 will be referred to in this Decision as the 2022 DC By-law.

5The issues on this Motion are:

1. Whether the Complaint was filed late and out of time pursuant to Section 20(2) of the DC Act rendering the Appeal invalid.

2. In the event that the Tribunal finds that the Complaint was made in accordance with Section 20(2) and that the Appeal is valid, the issues to be adjudicated in the Appeal should be limited to the three grounds set out in Section 20 of DC Act and proposed issues list in Schedule “A” of the Notice of Motion.

DECISION

6For the reasons below, the Motion for an Order dismissing this Appeal is dismissed.

7This Appeal will proceed on the Issues set out in Attachment 1 to this Decision.

8Costs of this Motion shall be in the cause.

9Counsel for the Parties are directed to consult on the terms of a draft Procedural Order (“PO”) and to submit the draft PO to the Tribunal’s Case Coordinator by September 8, 2023.

REASONS

Respondent’s Motion to Dismiss the Appeal

10The evidence in support of the Respondent’s Motion was provided by Fabrizio Filippazzo, in his Amended Affidavit sworn July 28, 2023 (the “Filippazzo Affidavit”). Mr. Filippazzo deposed that he was the Manager of Development Financing in the Treasury Office of the Respondent’s Finance Department at the relevant time and was responsible for the administration of the Respondent’s Development Charges By-law (“DC By-law”). He was also responsible for negotiating prepaid development charge credit agreements, administering development charge credits, assisting in the development of policy related to development charges, developing the development charges background study, growth related studies and the preparation of fiscal impact analyses.

11Mr. Filippazzo deposed that he has knowledge of the DC Act, the Respondent’s DC By-law and development financing, and that he has previously been qualified by the Tribunal and its predecessors to provide expert evidence in the areas of Land Use Planning and Development Charges (“DCs”). An Acknowledgement of Expert’s Duty signed by Mr. Filippazzo was attached as Exhibit B to his Affidavit. As Counsel for the Appellant did not object, the Tribunal qualified Mr. Filipazzo to provide the opinion evidence contained in his Affidavit in the areas of Land Use Planning and Development Charges.

12Mr. Filippazzo stated that the Appellants are the registered owners of lands municipally known as 23675 and 23965 Woodbine Avenue and 2596 Glenwood Avenue, Keswick in the Town of Georgina, in the Regional Municipality of York (“Subject Properties”). In August 2021, the Appellants submitted an Application for Site Plan Approval (“SPA”) for the construction of an industrial building on the Subject Properties, with a gross floor area of 369,461 square feet (“ft²”) (34, 324 metres squared [“m²”]) (“Proposed Development”).

13Mr. Filippazzo stated that, in accordance with the 2022 DC Bylaw, DCs were payable for the Proposed Development at the time of Building Permit issuance. The Respondent’s Regional Council had adopted the 2022 DC By-law on May 26, 2022, and it came into force on June 17, 2022.

14Mr. Filippazzo stated that, prior to the Bill 108 amendments to the DC Act, DCs were calculated at the time DCs were payable, which was typically at the time of Building Permit issuance or upon the registration of a Plan of Subdivision. After Bill 108, Section 26.2(3) of the DC Act permitted municipalities to charge interest on “frozen” DCs at a rate not exceeding the prescribed maximum interest rate, from the date of the Site Plan or Zoning By-law Amendment Application to the date the DC is paid.

15Mr. Filippazzo stated that as Bill 108 did not prescribe a maximum interest rate, on February 27, 2020, the Respondent’s Regional Council enacted a DCs Interest Policy, which imposed a rate of 5% compounded annually on “frozen” DCs. In accordance with the transition provisions of Bill 108, the “freeze” provisions under section 26.2 of the DC Act applied to Applications for SPA or a Zoning By-law Amendment made on or after January 1, 2020. As an SPA for the Proposed Development was made in August 2021, Section 26.2 of the Act was applicable and the DC rate in effect at the time the SPA was made was applied to the Proposed Development. In accordance with the 2022 DC By-law and the Interest Policy, an interest rate of 5% was applied to the DCs payable from the date the Site Plan Application was made to the date the DC was payable.

16Mr. Filippazzo stated the interest amount was $518,660.49. Therefore, the total DCs payable by the Appellants was $9,497,132.41. The Town of Georgina (the “Town”) is responsible for the issuance of Building Permits and collects DCs on behalf of the Respondent and remits the DCs it receives to the Respondent.

17Mr. Filippazzo related how on October 13th, 2022, the Town issued an invoice to the Appellants for the DCs payable for the Proposed Development.

18Mr. Filippazzo stated that on October 18, 2022, the Town issued a Building Permit for the Proposed Development and the Appellants paid the DCs in the amount of $9,497,132.41, which sum was collected by the Town on behalf of the Respondent.

19Mr. Filippazzo stated that on February 28, 2023, Counsel for the Appellants sent correspondence to the Respondent requesting a partial refund of the DC payment on the basis that the amount of the DC was incorrectly determined because the calculation of the DC plus interest, resulted in an amount that exceeded the DC rate at the time of payment by the sum of $478,158.17. The letter stated that the Appellants had filed a Complaint under Section 20(2) of the DC Act when the DCs were paid and it enclosed a copy of the covering letter dated October 14, 2022, from the Appellant’s Development Manager to the Town, which had enclosed the DC payment pursuant to the Town’s Building Division invoice issued on October 13, 2022, along with other amounts (the “Complaint Letter”).

20The Complaint Letter stated that:

the Owner is paying under protest the Regional Municipality of York Development Charges amount, for all of the reasons which are specified in that certain Altus Group Memorandum dated August 15, 2022 which has been provided by the Owner to both The Corporation of the Town of Georgina (the “Town”) and the Regional Municipality of York.

21Mr. Filippazzo stated that Section 20(2) of The DC Act requires that a Complaint must be made no later than 90 days after the DC, or any part thereof, is payable. The Respondent did not receive a copy of the October 14 Complaint Letter until February 28, 2023, which is after the expiry of the 90-day period for filing a Complaint. Accordingly, Mr. Filippazzo opined, a valid Complaint had not been filed by the Appellants and the Appeal should be dismissed. Alternatively, he said that, in the event that the Tribunal finds that a proper Complaint was made in accordance with Section 20 of the DC Act and that the Appeal is valid, the Respondent asks that the issues to be adjudicated in the Appeal should be limited to the three grounds set out in section 20 of DC Act and proposed Issues List in Schedule “A” of the Notice of Motion.

22Mr. Filippazzo opined, and Counsel for the Respondent submits, that the Appellants’ grounds of Appeal constitute an attack on the 2022 DC By-law, as the Notice of Appeal raises issues which do not fall within the scope of a section 20 Complaint. In particular, it raises issues alleging that the DC By-law contravenes certain provisions of the DC Act. Mr. Filippazzo stated that a Section 20 Complaint is not an opportunity for a person to appeal a DC By-law, which has been approved by Council, nor is it an opportunity to raise issues which are outside the grounds set out under Section 20 of the DC Act.

23Counsel for the Respondent submits that Section 20, permits a Complaint to be filed on only three grounds, which focus on determining whether a credit is available for the subject development, whether there was an error in the application of DC By-law or whether the DCs have been determined incorrectly.

Appellants’ Response to the Motion

24The evidence in support of the Appellant’s Response to the Motion was provided by Daryl Keleher, in his Affidavit sworn August 9, 2023 (the “Keleher Affidavit”). Mr. Keleher deposed that he was Principal of Keleher Planning & Economic Consulting Inc., was previously employed by Altus Group Economic Consulting, and that he was a land economist and urban planner specializing in public policy, land economics and municipal finance. Mr. Keleher deposed that his areas of expertise include, but are not limited to, DC background studies and by-law reviews, and DC Complaints.

25Mr. Keleher deposed that he has previously been qualified by the Tribunal and its predecessors, to provide expert witness testimony as a land economist with a specialization in DC work and as a land use planner. An Acknowledgement of Expert’s Duty signed by Mr. Keleher was attached as Exhibit B to the Keleher Affidavit. As Counsel for the Respondent did not object, the Tribunal qualified Mr. Keleher to provide the opinion evidence contained in his Affidavit respecting land economics, DCs and Land Use Planning matters.

26Mr. Keleher disagreed that DCs were imposed by the Respondent under the 2022 DC By-law, stating that the DC rate in effect in this instance would be the one in place in August 2021 when the SPA was filed. As the 2022 DC By-law did not come into effect until June 17, 2022, it is therefore the predecessor DC By-laws which would be applicable and not the 2022 DC By-law. Mr. Kelher deposed that the applicable DC By-laws are DC By-law 2017-35 and DC By-law 2018-42 (the “2017 DC By-law” and the “2018 DC By-law”).

27The 2017 DC By-law and the 2018 DC By-law were not repealed until June 16, 2022, which is after the DC determination date of August 20, 2021. Although repealed by the DC payment date of October 18, 2022, by virtue of Section 26.2(2) of the DC Act, the 2017 DC By-law and the 2018 DC By-law remained the applicable DC By-laws for purposes of the calculation of the DC amounts.

28Section 26.2 of the DC Act provides:

When amount of development charge is determined

26.2 (1) […] The total amount of a development charge is the amount of the development charge that would be determined under the by-law on,

(a) the day an application for an approval of development in a site plan control area under subsection 41 (4) of the Planning Act or subsection 114 (5) of the City of Toronto Act, 2006 was made in respect of the development that is the subject of the development charge;

(b) if clause (a) does not apply, the day an application for an amendment to a by-law passed under section 34 of the Planning Act was made in respect of the development that is the subject of the development charge; or

(c) if neither clause (a) nor clause (b) applies,

(i) in the case of a development charge in respect of a development to which section 26.1 applies, the day the development charge would be payable in accordance with section 26 if section 26.1 did not apply, or

(ii) in the case of a development charge in respect of a development to which section 26.1 does not apply, the day the development charge is payable in accordance with section 26. 2019, c. 9, Sched. 3, s. 8 (1); 2022, c. 21, Sched. 3, s. 8 (1).

Same, if by-law not in effect

(2) Subsection (1) applies regardless of whether the by-law under which the amount of the development charge would be determined is no longer in effect on the date the development charge is payable. 2019, c. 9, Sched. 3, s. 8 (1). [emphasis added]

29Mr. Keleher stated that the 2017 DC By-law and the 2018 DC By-law do not contain the same clause found in the 2022 DC By-law regarding the imposition of interest. Counsel for the Appellants submitted that whether there was an error in the application of DC By-law or whether the DCs have been determined incorrectly are valid issues for an Appeal under Section 20(2) of the DC Act.

ANALYSIS

30Mr. Filippazzo admitted that the Town was acting as the Respondent’s agent, but then qualified that admission by saying that the Town was performing an administrative function only by collecting the DCs.

31The Tribunal notes the evidence in Mr. Keleher’s Affidavit that Michelle Gunn, the Development Engineering Clerk for the Town, confirmed via email on March 24, 2023, that the Town had received the Complaint Letter on or about October 14, 2022, and it was filed into the Town’s records on October 18, 2022.

32The Tribunal observes that the evidence is that the Town issued the DC Invoice, collected the DCs on behalf of the Respondent, and issued the Building Permit. The Respondent did not provide notice to the Appellants that the Town’s appointment as its agent was limited, and that the Town’s authority did not extend to the acceptance of DC Complaints. The DC Invoice does not identify the Respondent’s contact person, the spaces on the form for the Respondent’s file number, Regional Staff name and Regional Staff Signature were all left blank. Despite these deficiencies the Appellant’s Construction Manager followed up with the Chief of Staff for the Respondent by email on December 2, 2022, referring to the specific particulars of the DC Complaint, and again on January 12, 2023, seeking a response. (Exhibits G and H to the Kelleher Affidavit).

33In the Tribunal’s opinion, it was reasonable for the Appellants to expect, and for the Respondent to expect, that the Complaint Letter would be forwarded to the person responsible for DC Complaints at the Respondent. It appears that there was a breakdown in communication between the Town and Respondent. In the Tribunal’s opinion, the Appellants should not be prejudiced by this communication failure.

34The Tribunal therefore finds that the Town was the agent for the Respondent and that delivery of the Complaint Letter to the Town constituted delivery to the Respondent. For these reasons the Tribunal finds that the October 14 Complaint Letter is a valid DC Complaint and that it was filed within the time required by Section 20(2) of the DC Act.

35The Tribunal also finds that the Appeal raises the valid issues under Section 20(1)(a) of the DC Act of whether interest could be assessed on the amount of the DC, and whether that amount was incorrectly determined. The Appeal does not constitute an attack on the 2022 DC By-law.

36The Tribunal refers to Section 8(2) of the Ontario Land Tribunal Act and finds that the Appellants’ proposed issues are proper issues within the very broad jurisdiction granted to this Tribunal. The Tribunal therefore Orders that the Appeal proceed on the issues as contained in the Appellants’ Issues List, which is attached to this Decision as Attachment 1.

37Counsel were directed to confer on the terms of a Procedural Order (“PO”) and to submit a draft PO to the Tribunal’s Case Coordinator by September 8, 2023. The Tribunal has received the draft PO and Counsel for the Parties have requested that two days be set aside for the Hearing. The Parties are directed to attend a CMC for the purpose of scheduling the Hearing of this Appeal on the Merits and to finalize the terms of the PO.

38Accordingly, the Tribunal set a second CMC for: Tuesday, November 7, 2023, commencing at 10:00 a.m. by video hearing.

39Parties and participants are asked to log into the video hearing at least 15 minutes before the start of the event to test their video and audio connections:

GoTo Meeting: https://meet.goto.com/680885805

Access code: 680-885-805

40Parties and Participants are asked to access and set up the application well in advance of the event to avoid unnecessary delay. The desktop application can be downloaded at GoToMeeting or a web application is available: https://app.gotomeeting.com/home.html

41Persons who experience technical difficulties accessing the GoToMeeting application or who only wish to listen to the event can connect to the event by calling into an audio-only telephone line: (toll free) 1 888 299 1889 or +1 (647) 497-9373. The access code is 680-885-805.

42Individuals are directed to connect to the event on the assigned date at the correct time. It is the responsibility of the persons participating in the hearing by video to ensure that they are properly connected to the event at the correct time. Questions prior to the hearing event may be directed to the Tribunal’s Case Coordinator having carriage of this case.

ORDER

43THE TRIBUNAL ORDERS that the Motion for an Order dismissing this Appeal is dismissed.

44AND THE TRIBUNAL ORDERS that this Appeal will proceed on the Issues set out in Attachment 1 to this Decision.

45AND THE TRIBUNAL ORDERS that the Costs of this Motion shall be in the cause.

46Counsel for the Parties are directed to consult on the terms of a draft Procedural Order (“PO”) and to submit the draft PO to the Tribunal’s Case Coordinator by September 8, 2023.

“Robert G. Ackerman”

ROBERT G. ACKERMAN

MEMBER

Ontario Land Tribunal

Website: www.olt.gov.on.ca Telephone: 416-212-6349 Toll Free: 1-866-448-2248

The Conservation Review Board, the Environmental Review Tribunal, the Local Planning Appeal Tribunal and the Mining and Lands Tribunal are amalgamated and continued as the Ontario Land Tribunal (“Tribunal”). Any reference to the preceding tribunals or the former Ontario Municipal Board is deemed to be a reference to the Tribunal.

ATTACHMENT 1

1. Did the determination of the Region’s Development Charge, which included the application of the Region’s Interest Rate Policy, lead to an error in the determination and application of the Region’s Development Charge By-law due to:

a. A contravention of s. 5(1)(4) of the Development Charges Act?

b. A contravention of s. 2(1) of the Development Charges Act?

c. A contravention of s. 5(1)(9), 5(6)(1), and 5(6)(2) of the Development Charges Act?

2. Does s. 26.2(3) of the Development Charges Act authorize imposing the Region’s Development Charge as determined and applied under the circumstance?

3. Should Greycan 12 Properties Inc. and 12501252 Canada Inc. be granted a refund pursuant to s. 25 of the Development Charges Act? If so, what is the correct value of the refund?