Ontario Land Tribunal

Tribunal ontarien de l’aménagement du territoire

ISSUE DATE: November 07, 2024

CASE NO(S).: OLT-23-000625

PROCEEDING COMMENCED UNDER subsection 34(11) of the Planning Act, R.S.O. 1990, c. P.13, as amended

Applicant and Appellant: 2564669 Ontario Inc. and 520039 Ontario Limited

Subject: Application to amend the Zoning By-law – Refusal or neglect to make a decision

Description: To facilitate the development of a residential subdivision

Reference Number: Z12-21

Property Address: Concession 6, Part Lots 13 and 14, Otonabee Ward, Registered Plan 45R-335 Parts 2 and 3, and part 1 of 1

Municipality/UT: Otonabee-South Monaghan/Peterborough

OLT Case No.: OLT-23-000625

OLT Lead Case No.: OLT-23-000625

OLT Case Name: 2564669 Ontario Inc. and 520039 Ontario Limited v. Otonabee (Township)

PROCEEDING COMMENCED UNDER subsection 51(34) of the Planning Act, R.S.O. 1990, c. P.13, as amended

Applicant and Appellant: 2564669 Ontario Inc. and 520039 Ontario Limited

Subject: Proposed Plan of Subdivision – Failure of Approval Authority to make a decision

Description: To facilitate the development of a residential subdivision

Reference Number: 15CD-21001

Property Address: Concession 6, Part Lots 13 and 14, Otonabee Ward, Registered Plan 45R-335 Parts 2 and 3, and part 1 of 1

Municipality/UT: Otonabee-South Monaghan/Peterborough

OLT Case No.: OLT-23-000626

OLT Lead Case No.: OLT-23-000625

OLT Case Name: 2564669 Ontario Inc. and 520039 Ontario Limited v. Otonabee (Township)

PROCEEDING COMMENCED UNDER subsection 20 of the Ontario Land Tribunal Act, 2021, S.O. 2021, c. 4, Sched. 6

Request by: 2564669 Ontario Inc. and 520039 Ontario Limited

Request for: Request for an Order Awarding Costs

Costs sought against: David Earl

Heard: In Writing

APPEARANCES:

Parties	Counsel
2564669 Ontario Inc. and 520039 Ontario Limited	Kathleen Kinch, Jenna Khoury-Hanna
Dave Earl	Richard Taylor

DECISION DELIVERED BY C. HARDY AND ORDER OF THE TRIBUNAL

BACKGROUND

1The following Decision and Order arises out of a written motion for costs brought by 2564669 Ontario Inc. and 520039 Ontario Limited (“Appellant”) against Dave Earl (“Mr. Earl”) in the amount of $25,610.15 relating to a Motion brought by Mr. Earl to extend the time for filing an expert witness statement (“Motion Costs”) and a further amount of $17,036.50 relating to the hearing of the merits (“Hearing Costs”).

2The Motion Costs and Hearing Costs being sought by the Appellant arise out of a hearing of the Appellant’s appeals of its proposed Zoning By-law Amendment (“ZBA”) and Draft Plan of Subdivision/Condominium to enable implementation of its plan of condominium in the Municipality of Otonabee-South Monaghan (“Township”) in the County of Peterborough (“County”). The appeals were based on the failure of the Township and County to make decisions on the applications.

3Mr. Earl was added as a Party to the proceedings and appeared in opposition to the Appellant’s applications on the limited scope of stormwater management. Mr. Earl’s property abuts a portion of the Appellant’s property and his concerns centred around safety with additional water that he alleged would be directed to his property from the proposed development. The County and the Township also appeared at the hearing of the merits, however, did not participate in this Motion for Costs. A detailed background of the appeal is set out in the Decision of the hearing of the merits issued August 16, 2024; 2564669 Ontario Inc. and 520039 Ontario Limited v Otonabee (Township) https://canlii.ca/t/k6fr1 (“Appeal Decision”).

4In its Appeal Decision, the Tribunal allowed the appeals by the Appellant with the Tribunal’s final Order being withheld until certain filings were made. Prior to the Motion for Costs, the required filings were made, and the final Order of the Tribunal was issued on September 25, 2024.

TRIBUNAL’S AUTHORITY TO AWARD COSTS

5The Tribunal’s statutory authority to award costs has been set out in many prior Decisions of the Tribunal, however, it bears repeating. The authority is set out in s.20 of the Ontario Land Tribunal Act S.O. 2021, c. 4, Sched. 6 (“OLTA”) and Rule 23 of the Tribunal’s Rules of Practice and Procedure (“Rules”), which are consistent with the Statutory Powers Procedure Act R.S.O. 1990, c. S. 22, as amended (“SPPA”).

6Costs do not follow the cause in Tribunal proceedings. The Tribunal has discretionary powers to award costs based on behaviour and costs awards are not automatic.

Statutory Powers and Procedures Act

7Two requirements are set out in s. 17.1(2) of the SPPA which could lead to the Tribunal granting an award of costs. The first requirement is that the conduct or course of conduct of a Party must have been “unreasonable, frivolous or vexatious or a party has acted in bad faith”. The second requirement is that the Tribunal has made rules regarding costs.

8With respect to rules, s. 17.1(4)(b) of the SPPA requires the Tribunal to set out circumstances in which costs may be ordered.

Ontario Land Tribunal Act

9Similarly, s. 20 of the OLTA provides as follows:

The Tribunal may, subject to any other Act, fix the costs of and incidental to any proceeding, and order a party to the proceeding to pay the costs in accordance with the rules.

Tribunal’s Rules of Practice and Procedure

10Rule 23.09 sets out circumstances when costs may be awarded and further sets out a non-exhaustive list of the types of conduct that may attract a costs award. Similar to the SPPA, Rule 23.09 requires the conduct of a party to be “unreasonable, frivolous or vexatious or bad faith conduct…” in order to garner a costs award to be made against them. Rule 23.09 sets out the following guidance:

The Tribunal may only order costs against a party if the conduct or course of conduct of a party has been unreasonable, frivolous or vexatious or if the party has acted in bad faith. Clearly unreasonable, frivolous, vexatious or bad faith conduct can include, but is not limited to:

a) failing to attend a hearing event or failing to send a representative when properly given notice, without contacting the Tribunal;

b) failing to give notice without adequate explanation, lack of co-operation with other parties during the proceedings, changing a position without notice to the parties, or introducing an issue or evidence not previously mentioned or included in a procedural order;

c) failing to act in a timely manner or failing to comply with a procedural order or direction of the Tribunal where the result is undue prejudice or delay;

d) a course of conduct necessitating unnecessary adjournments or delays or failing to prepare adequately for hearing events;

e) failing to present evidence, continuing to deal with issues, asking questions or taking steps that the Tribunal has determined to be improper;

f) failing to make reasonable efforts to combine submissions with parties of similar interest;

g) acting disrespectfully or maligning the character of another party;

h) knowingly presenting false or misleading evidence; or

i) breaching a confidentiality requirement of a mediation, settlement conference or of a decision of the Tribunal in the hearing of the merits.

The Tribunal is not bound to order costs when any of these examples occur as the Tribunal will consider the seriousness of the misconduct.

11Rule 23.10 speaks to the amount of a costs award providing the Tribunal with the discretion to deny or grant the request or award a different amount. Finally, Rule 23.11 addresses interest on a costs award referring to s. 129 of the Courts of Justice Act, R.S.O. 1990, c. C.43.

MOTION FOR COSTS

12The Motion for Costs brought by the Appellant requests the following relief:

a) An order for costs against Mr. Earl, payable to the Appellants in the amount of $25,610.15 for the costs of the Motion brought by Mr. Earl on July 10, 2024; and

b) An Order for Costs against Mr. Earl, payable to the Appellants in the amount of $17,036.50 for the cost of the Ontario Land Tribunal (“Tribunal”) Hearing held on July 10, 11 and 12, 2024, being the costs that are attributed solely to Mr. Earl’s participation in the hearing process.

13In support of the requested relief, the Appellant argued that the conduct of Mr. Earl meets both the threshold of “unreasonable, frivolous or vexatious or a party that has acted in bad faith” and further amounts to the level of being an abuse of process. In support of this argument, the Appellant offered numerous examples, including Mr. Earl’s introduction of a new issue requiring the Appellant to retain a second expert witness, Mr. Earl’s expert, Murray Davenport, disregarding the directives set out in the Procedural Order (“PO”), and Mr. Earl continuing with the appeal after being provided with opportunities to change course. In the absence of planning evidence, Mr. Earl almost doubled the Appellant’s costs associated with the appeal.

14In addition to the Tribunal’s statutory authority to award costs set out above, the Appellant argued that the Tribunal may order costs pursuant to s. 23(1) of the SPPA as set out in 2684360 Ontario Ltd. v. Kingston (City), 2021 Carswell ON 2726 (LPAT) (“268 Ontario”). In 268 Ontario, the Tribunal found that s. 23 of the SPPA granted it the authority to control its proceedings by making orders it considers proper to prevent an abuse of process, which the Appellant urged the Tribunal to consider when Mr. Earl’s approach to the appeal is taken as a whole.

15In its Motion materials, the Appellant provided a detailed breakdown of the costs incurred in relation to both the Motion Costs and the Hearing Costs, including legal fees and the retention of two experts. With respect to the Motion Costs, the Appellant submitted that it incurred unnecessary costs in responding to the Motion which was required due to Mr. Earl’s failure to adhere to the PO. A detailed account of Mr. Earl’s failure to adhere to procedural requirements is set out in the Appeal Decision, however, in its Motion materials, the Appellant highlighted Mr. Davenport’s unresponsiveness throughout the proceedings and his failure to meet procedural deadlines in the absence of communication with the Parties or the Tribunal.

16The Appellant further submits that the stormwater management issue raised by Mr. Earl would not have been raised but for his involvement as a third party as neither the County nor the Township had stormwater management concerns. This additional issue compelled the Appellant to incur costs which were thrown away to retain an expert engineer, Chris Proctor, to respond to Mr. Davenport’s evidence and the stormwater management concerns raised by Mr. Earl. The Appellant provided Mr. Earl with several reasonable solutions leading up to the hearing and despite these offers, Mr. Earl chose to continue as a Party which amounts to unreasonable and frivolous conduct.

RESPONSE TO THE MOTION FOR COSTS

17The Response to the Motion for Costs requests the Tribunal to dismiss the Motion and make an award that no costs are payable by Mr. Earl. In the alternative, should the Tribunal find that an award of costs is payable by Mr. Earl, the quantum should be proportionate and not constitute a penalty recognizing that Mr. Earl had genuine issues to be heard, acted legitimately and did not proceed in a frivolous or vexatious manner.

18In support of the requested relief, Counsel for Mr. Earl argues that the only relevant consideration for a potential costs award is the failure to provide the witness statement of Mr. Davenport in accordance with the deadline set out in the PO. It is submitted that this amounted to a mistake, and case law relied upon by Mr. Earl support the argument that a mistake is not sufficient to qualify as frivolous, vexatious, or bad faith conduct.

19The thrust of Mr. Earl’s position is that there was no delay, hardship nor prejudice due to the late filed witness statement. The hearing was not delayed nor adjourned and in fact, Counsel for Mr. Earl argues that if they had been included in the settlement discussions between the Appellant, County and Township, the matter may have been fully settled or at least scoped. It is submitted that Mr. Earl requested Party status as a concerned adjacent homeowner who raised genuine concerns regarding the Appellant’s development and continues to have those concerns to this day.

20Counsel for Mr. Earl reviewed in detail the evidence tendered during the hearing relating to the anticipated risks that Mr. Earl’s property would face in the event that the proposed development proceeded to reinforce that Mr. Earl had genuine and legitimate concerns. In addition, it was submitted that the Tribunal rarely imposes costs due to its role being more akin to a public inquiry. In contrast, Civil Courts often award costs to successful Parties as they consider matters that are more adversarial in nature. In this case, Counsel for Mr. Earl argued that he was partially successful in the appeal and nevertheless, the Tribunal does not base an award of costs on who won but rather exercises its discretion in clear cases where conduct is in contravention of certain criteria.

21It was further submitted that the Tribunal’s exercise of its discretion with respect to costs should not have the effect of discouraging legitimate inquiry by the public or have a “chilling effect”. In advance of this position, Counsel for Mr. Earl provided case law to demonstrate that costs awards are rarely imposed and when done so, are due to conduct that the Tribunal has found to be clearly unreasonable. Mr. Earl’s conduct was reasonable as he acted in good faith advancing legitimate concerns relating to potential adverse impacts and safety concerns relating to his property. The seriousness of Mr. Earl’s concerns are evidenced in the steps that he undertook to retain legal Counsel and an Engineering expert.

22The responding materials detail the various attempts at settlement that Mr. Earl made leading to his partial success in the appeal with the addition of the Environmental Protection (“EP”) Zone in the final iteration of the ZBA and the inclusion of conditions addressing proper risk management and safety concerns. Mr. Earl’s conduct was not unreasonable, frivolous or vexatious and as a Party to the proceedings, he was able to question the Appellant’s witnesses in regard to stormwater management whereas if he “downgraded” to a Participant, that right to question would no longer exist.

APPELLANT REPLY

23The Tribunal also considered the detailed Reply of the Appellant. The Appellant disagrees with Mr. Earl’s submissions that he was partially successful in the appeal. It is submitted that at the commencement of the hearing, Mr. Earl’s withdrawal of the issue relating to the entrance to the condominium cannot be viewed as a success. Further, the EP zone shown in the settlement documentation among the Appellant and the Township was an ordinary setback from a watercourse and formed part of the settlement materials, which Mr. Earl did not have any part of. The inclusion of an EP zone had nothing to do with Mr. Earl’s stormwater management issue and cannot be construed as a “success” on Mr. Earl’s part.

24The Appellant also disagreed with Mr. Earl’s arguments and reliance on case law to argue that Mr. Earl’s attempts to resolve matters should form part of the Tribunal’s consideration in making a determination if a costs award is warranted. While the Appellant agrees that settlement offers are a legitimate consideration for the Tribunal in a costs motion, it argues that Mr. Earl never presented the Appellant with a reasonable opportunity to resolve the case. The settlement proposals of Mr. Earl were unreasonable for various reasons, including, but not limited to, the requirement that the Appellant incorporate major changes into the proposal as opposed to minor adjustments and the addition of settlement terms that were not related to his scoped issue in the appeal.

25The Appellant provided a response to Mr. Earl’s contention that the Tribunal’s role is to conduct an inquiry in accordance with the public interest. The Appellant referred to the OLTA and the Planning Act, R.S.O. 1990, c. P.13 (“Planning Act”) in support of its argument that the Tribunal carries out an adjudicative function and is markedly different from that of a public inquiry. In addition, the Appellant submitted that Mr. Earl’s conduct was not in accordance with the sections of the Planning Act relating to co-operation and co-ordination among various interests due to the non-compliance with the PO.

ANALYSIS AND FINDINGS

26The Tribunal has considered the detailed Motion materials filed by both Parties and is unable to find any action, or inaction, on the part of Mr. Earl that definitively leads to a finding that he was acting in bad faith, advancing an appeal in a frivolous manner or intending to be vexatious with respect to the Hearing Costs. With respect to the Motion Costs, the Tribunal is also not prepared to exercise its discretion to make an award of costs against Mr. Earl in favour of the Appellant for expenses incurred in the preparation of a response to Mr. Earl’s Motion to extend the time for the filing of Mr. Davenport’s witness statement.

27As a starting point, an award of costs relating to Tribunal proceedings is not the norm, rather, costs awards are dependent upon the facts in each particular case and are awarded in rare and exceptional circumstances. In order to attract an award of costs, the Tribunal must find that the conduct of a party has been unreasonable, frivolous, vexatious or in bad faith (emphasis added). The type of conduct is disjunctive, and Rule 23.9 of the Rules makes it clear that the decision to award costs is discretionary. Further, as both Parties have pointed out in their written materials, costs do not automatically follow success at a hearing, nor do they automatically follow a finding that there was no merit in an appeal.

28The Appellant submitted that Mr. Davenport was never a serious expert due to his alleged competing developer activities leading to his inability to be neutral. Mr. Earl submitted that the Tribunal should consider the conduct of the County and the Township regarding the failure to conduct one final peer review. The Tribunal did not place any weight on these submissions and dismisses both of these lines of argument as they are inappropriate and/or irrelevant to the herein Motion for Costs

29For the reasons that follow below, the Tribunal finds that an award of costs against Mr. Earl is not warranted with respect to either the Motion Costs or the Hearing Costs. The Motion materials blurred the lines between the conduct relating to the Motion Costs and the Hearing Costs, however, the Tribunal would distill the conduct relating to the Hearing Costs down to the additional issue raised by Mr. Earl and his continued involvement in the appeal. With respect to the Motion Costs, the thrust of the Appellant’s argument was the lack of adherence to the PO by Mr. Earl.

30The Appellant maintained that Mr. Earl increased time and cost of the hearing because he raised an issue the neither the County or the Township were concerned about and further, remained involved in the proceedings until the very end. These arguments can be succinctly dealt with by the Tribunal.

31Mr. Earl’s involvement as a Party was limited to his issue concerning stormwater management, which was never a concern of the County nor the Township. In the absence of the requirement of an added Party to shelter, which did not exist in this case, an added Party to an appeal can raise any issues they wish providing that they are within the Tribunal’s jurisdiction. Given that the Approval Authorities were not concerned with stormwater management, the only way for Mr. Earl to raise this concern was to seek Party status and include this as an issue to be considered by the Tribunal. The Tribunal is not persuaded by the Appellant’s arguments that the added issue compelled it to incur costs thrown away. Mr. Earl was granted limited Party status to raise only issues related to stormwater management. He did just this. Further, this was not a last minute added issue, rather, all Parties knew of Mr. Earl’s stormwater management concerns when he was added as a Party in March, 2024. The Tribunal cannot find any lack of seriousness on the part of Mr. Earl raising this issue. Parties must approach appeals with the understanding that some additional cost will result from the filing of any appeal and in this case, there is no evidence that Mr. Earl unduly increased the costs of these proceedings.

32The materials filed by the Parties make it clear that there were numerous attempts made to encourage Mr. Earl to withdraw as a Party. The Tribunal notes that regardless of how well-intentioned the attempts by the Appellant were to explain to Counsel for Mr. Earl why he should reconsider his position to remain involved in the proceedings, Mr. Earl had a right to remain involved as a Party. Mr. Earl retained legal Counsel and an expert witness in support of his position, and it is Mr. Earl’s prerogative whether he continues to maintain his status in the appeal. The Tribunal did not find the Appellant’s submissions in this regard persuasive.

33The failure of Mr. Earl’s witness to respond to meeting requests and adhere to deadlines established in the PO may on their face amount to conduct that is considered unreasonable or in bad faith. The Tribunal is not persuaded that the conduct rose to the level of seriousness to meet these requirements. Mr. Earl retained Mr. Davenport to prepare a witness statement and provide evidence at the hearing relating to the stormwater management issue. Unfortunately, Mr. Davenport was unavailable to attend the meeting of experts by the deadline imposed in the PO, and further, did not respond to correspondence sent to him by the other experts in an effort to set up the meeting. Mr. Davenport’s witness statement was filed 12 days after the deadline set out in the PO and there was no attempt by Mr. Earl to obtain consent from the Parties or the Tribunal to file the witness statement late.

34The Tribunal disagrees with Mr. Earl’s position that the Tribunal process is akin to that of a public inquiry. The Tribunal’s process is more formal than a public meeting or inquiry and there is an expectation on Parties to approach Tribunal proceedings in a meaningful way. The expectation is that Parties will operate in a cooperative and efficient manner in all respects relating to the proceedings. One aspect of this is adherence to deadlines and if events arise making adherence difficult or unachievable, then communication amongst Parties and with the Tribunal is required. Further, as the Tribunal noted in the Appeal Decision, the PO is not a suggestion, it is an Order. While Mr. Earl may not have been an experienced Party, he retained legal Counsel to assist him in the proceedings. No Party, especially one represented by legal Counsel, should disregard requirements established in a PO without any notice to the opposing Parties or the Tribunal, nor any request for relief or extensions from the opposing Parties or the Tribunal.

35Upon finding that the disregard of the procedural requirements by Mr. Earl and Mr. Davenport amounts to unreasonable or bad faith conduct, the Tribunal must consider the seriousness of this conduct to determine if it rises to the level required for the Tribunal to impose a costs award. The Tribunal finds that the unresponsiveness of Mr. Davenport and the failure to meet deadlines did not result in significant, if any, delay in the proceedings. The prejudice suffered by the Appellant amounted to the time and cost incurred in responding to the Motion to allow Mr. Davenport’s witness statement into evidence at the hearing. As noted above, in launching or participating in an appeal, Parties should expect some additional costs to be incurred. Motions are often part of the process leading up to a hearing event, or during a hearing event. The Tribunal finds that the Motion Costs did not significantly prejudice the Appellant. In making this finding, the Tribunal is in no way condoning disregard for the PO and would strongly remind Parties that the procedural requirements found therein are Orders and not suggestions.

36The Tribunal agrees with Mr. Earl that costs awards must be approached with care to avoid a “chilling effect”, and notes that the Tribunal and its predecessors have consistently been mindful of this. A high threshold must be met in order to warrant the Tribunal’s exercise of its discretion to award costs, in part due to the Tribunal’s duty to accommodate and facilitate public participation in the planning process and avoid discouraging appeals by legitimately concerned citizens. In weighing the gravity of Mr. Earl’s conduct, or course of conduct, against the Tribunal’s duty to facilitate public participation, the Tribunal finds that the conduct of Mr. Earl did not rise to the high bar required to warrant the exercise of its discretion to award costs.

37The Tribunal therefore denies the Motion for Costs in its entirety.

ORDER

38THE TRIBUNAL ORDERS that the motion for costs by 2564669 Ontario Inc. and 520039 Ontario Limited is denied and no costs are awarded. The motion for costs is dismissed.

“C. Hardy”

C. Hardy VICE CHAIR

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.