2277550 Ontario Inc. o/a Michael’s on Simcoe v. Toronto (City), 2024 CanLII 69902

Ontario Land Tribunal

Tribunal ontarien de l’aménagement du territoire

ISSUE DATE:

July 19, 2024

CASE NO.:

OLT-21-001655

PROCEEDING COMMENCED UNDER subsection 26(1) of the Expropriations Act, R.S.O. 1990, c. E.26, as amended

Claimant:

2277550 Ontario Inc. o/a Michael’s on Simcoe

v. City of Toronto

Respondent:

City of Toronto

Description:

Determination of compensation

Property Address:

100 Simcoe Street

Municipality/UT:

City of Toronto

OLT Case No.:

OLT-21-001655

OLT Lead Case No.:

OLT-21-001655

OLT Case Name:

2277550 Ontario Inc. o/a Michael’s on Simcoe

v. Toronto (City)

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

Request by:

City of Toronto

Request for:

Request for Dismissal Without a Hearing

Heard:

May 31, 2024, in Writing

APPEARANCES:

Parties

Counsel

City of Toronto (“City”)

M. Longo

M. Mahoney

2277550 Ontario Inc. o/a Michael’s

S. Bookman

on Simcoe (“Michael’s” or “Claimant”)

D. Eddenden

DECISION DELIVERED BY William R. Middleton AND ORDER OF THE TRIBUNAL

1The City originally brought this motion to dismiss the claim by Michael’s returnable July 28, 2023. However, it was placed in abeyance until recently due to other developments in this proceeding which culminated in the Tribunal’s Order dated November 1, 2023.

2On May 14, 2024, upon enquiry from the Tribunal, the City indicated that it still wished the Tribunal to adjudicate the matters raised on its motion. Enwave Energy Corporation (“Enwave”), now a party to this proceeding pursuant to the Tribunal’s November 1, 2023 Order, by correspondence dated May 15, 2024 took no position on the City’s motion and filed no materials.

3The City’s motion seeks (below emphasis added) (“Motion”):

…an Order dismissing the claim by Michael's On Simcoe ("Michaels") in its entirety, on the basis that:

a) Michaels has failed to set out a claim for damages against the City pursuant to the Expropriations Act for which the Ontario Land Tribunal ("OLT") could grant an order for compensation, including:

i. Michaels has failed to identify any actions or activities performed by the City that could found a cause of action; and,

ii. There is no basis in the pleadings to find an actionable nuisance against the City as required for an injurious affection claim.

b) Michaels' appeal satisfies one of more grounds set out in section 19(1) of the Ontario Land Tribunal Act and/or Rule 20.04 of the Rules of Civil Procedure to warrant a dismissal of the appeal/granting of summary judgment without holding a hearing on the appeal.

4The materials filed on the City’s Motion included:

(a) Motion Record of the City, dated July 11, 2023, comprising 51 pages;

(b) Motion Record of Michaels, dated July 20, 2023, comprising 30 pages;

(c) Notice of Reply to Response to Motion of City, dated July 25, 2023, comprising 6 pages;

(d) Book of Authorities of Michael’s, dated July 20, 2023, comprising 156 pages; and

(e) City’s Book of Authorities, dated July 20, 2023, comprising 64 pages.

THE CITY’S MOTION AND THE PLEADINGS

5The City’s Motion alleges that the Claimant’s Statement of Claim dated November 22, 2021, fails to set out a proper claim against the City and must therefore be dismissed as against the City. The City delivered its Reply to that pleading on or about June 10, 2022.

6However, the Claimant has also filed with the Tribunal an Amended Notice of Arbitration and Statement of Claim dated February 20, 2024. According to the Tribunal's file, the City has not delivered a Reply to this amended pleading and the City’s Motion does not respond to it. Interestingly, in an earlier filing by the City dated July 20, 2023 that responded to the Claimant’s 2023 motion to add Enwave (since granted by the Tribunal as noted above), the City seemed to object to the Claimant’s amended pleading arguing:

The Claimant is improperly attempting to amend its pleadings, despite not requesting such relief, to claim new causes of action and sources of liability against the City, which should be disallowed…

Notwithstanding that argument, the City sought no formal relief in this Motion. In any event, it is clear that under the Ontario Rules of Civil Procedure (“Civil Rules”) a party may amend its Statement of Claim at almost any time except in situations where prejudice has occurred which could not be compensated for by an award of costs (see: Civil Rule 26.01). However, this Tribunal is not strictly bound to follow the Civil Rules except in limited circumstances, as noted below in paragraph [12] onward. The Tribunal is not convinced by the bare allegation of prejudice later made by the City in that same motion filing. At this early juncture, the Tribunal sees no apparent prejudice to the City who will have an opportunity to respond to all of the Claimant’s allegations, including but not limited to the delivery of its amended Reply.

7Both the original and the amended Statement of Claim set out allegations in support of claims by Michaels brought under the provisions of the Expropriations Act, R.S.O. 1990, c. E.26, as amended (“Act”).

8Counsel for the City has utilized various arguments on its Motion. For example, at paragraph 6 of its Motion Record, they state (below emphasis added):

…the City identifies that Michaels has not provided sufficient particulars to ground a claim against the City for the described works. In particular, Michaels failed to identify a start date to any works, duration of works, or details of the alleged works...

9Then at paragraph 8 of its Motion Record, the City’s counsel states (below emphasis added):

…Michaels, like any claimant, is required by statute and the Rules of Civil Procedure to provide a concise statement of facts in its pleadings. Michaels has not provided additional details of their claim or amended their claim since the City filed its response to Claim…

10Much of the City’s Motion Record also recites positions regarding matters of law pertaining to claims under the Act, including:

(a) The nature of claims under the Act for injurious affection;

(b) That injurious affection claims require demonstration of a common law nuisance;

(c) Whether the City’s role in, inter alia, issuing permits for construction by others in the area of the Claimant’s business could be the subject of an injurious affection claim under the Act;

(d) Whether there was anything ‘unreasonable’ in the interference caused by the works in proximity to the Claimant’s business;

(e) Whether the Claimant must have a claim directly against the City “…as a statutory authority…”; and

(f) Whether the Claimant can prove that it has a private nuisance claim against the City.

11To support its position on the Motion, the City relies on various provisions of the Tribunal’s Rules of Practice and Procedure (“Rules”) (including Rule 15.4), as well as the Ontario Land Tribunal Act, S.O. 2021 (“OLTA”) (including section 19(1)(c)), and the Civil Rules (including the summary judgment provisions of the Civil Rules).

THE TRIBUNAL’S APPROACH TO MOTIONS FOR DISMISSAL IN EXPROPRIATION CASES

12As was pointed out in extensive reasons by this Tribunal in its Decision dated June 21, 2023 in Don Valley Auto Centre Ltd. v. Metrolinx, 2023 CanLII 56710 (ON LT) (“Don Valley Case”) regarding a similar motion hearing (below emphasis added):

Obviously, section 19(1) of OLTA provides the statutory basis for Rule 15.4 but among other aspects does refer to a dismissal sought by ” …on the motion by any party.”, which of course corresponds to the circumstances of this Metrolinx motion. Section 19 of OLTA expressly applies instead of section 4.6 of the Statutory Powers Procedure Act, R.S.O. 1990, c. S22 (“SPPA”) by virtue of section 19(5) but incorporates reference to circumstances set out in section 4.6(1) of the SPPA…By a (necessary) circuitous route then, Metrolinx apparently takes the position on its Motion for Summary Judgment that the combined effect of Rule 15.4 of the OLT Rules, section 19(c) of OLTA and section 4.6(1) of the SPPA, this Tribunal is permitted to dismiss a matter without a hearing if it relates to matters outside the jurisdiction of the OLT. The Tribunal agrees, but declines to do so in this case for the reasons that follow…

It is interesting that Metrolinx – and Don Valley – also make reference to and rely on Rule 20 of the Civil Rules which sets out the requirements relating to the granting of summary judgment in Ontario civil actions. Certainly, there is no express and specific summary judgment provision contained in the OLT Rules which may explain this. Certainly, the Tribunal and its predecessors has applied Rule 20 in past jurisprudence, as cited in the Parties’ Briefs of Authorities… However, the Tribunal notes that it is not strictly bound to apply the Civil Rules in OLT proceedings, even those under the Expropriation Act, R.S.O. 1990, c.E26 (“EA”), except in very specific circumstances…

… Therefore, in this Tribunal’s view, there is no mandatory requirement that the Tribunal to refer to or apply Rule 20 of the Civil Rules unless it believes that to do so would provide the best available remedy in the circumstances of this case. Put another way, this Tribunal prefers not to encourage a Party to seek a summary judgment ruling and to thereby import the considerable jurisprudence relating to Rule 20 of the Civil Rules absent some compelling reason to do so…

Summary judgment is a remedy more suited to Ontario Superior Court proceedings, and this Tribunal is mindful of its overall mandate under both OLTA and the OLT Rules. Under section 12(2) of OLTA, this is expressed as follows:

“Fair, just and expeditious resolution

(2) The Tribunal shall, in respect of each proceeding, adopt any practices and procedures provided for in the rules or that are otherwise available to the Tribunal that, in its opinion, offer the best opportunity for a fair, just and expeditious resolution of the merits of the proceedings”…

In this Tribunal’s determination, the same point is equally applicable to Rules 21 and 25 of the Civil Rules. Simply put, it is the view of this Tribunal that if it was to enthusiastically encourage the adoption of summary judgment motion practice, pleading motion practice and other procedures commonly available in Superior Court actions this could distract – or even detract - from the objectives described above…

… This is not to be construed as a finding that the OLT will never consider and apply Rules 20, 21 and 25 of the Civil Rules but rather the expression of a determination that the Tribunal has the discretion to decide not to do so except in compelling circumstances. A clear analogous example would be the common practice of the Tribunal in expropriation proceedings to refer to and apply the provisions of Rule 30 and 34 of the Civil Rules in relation to disputes arising from examinations for discovery – those Rules provide necessary, required substance and procedure for important steps in the proceedings in a situation where none are provided in the OLT Rules…

… The Tribunal does not find it necessary to conduct a detailed summary judgment analysis nor a review of the considerable summary judgment jurisprudence cited by counsel for both Parties, for the reasons already noted above. In any event, based on its careful review of the many competing factual contentions made in both Metrolinx’s Factum and in Don Valley’s Responding Factum, it is the Tribunal’s view that there are obvious, significant issues of factual dispute that cannot be properly resolved by motion at this juncture. If the Tribunal had chosen to consider and apply Rule 20 of the Civil Rules, this would be fatal to the summary judgment motion…

13On this Motion, this Tribunal adopts and relies upon its approach in the Don Valley Case, as described in paragraph [12] above.

THE INADEQUACY OF THE FACTUAL RECORD

14Here the Parties have both filed supporting affidavits with their motion records. To the Tribunal’s knowledge, no cross-examinations on those affidavits were conducted. In any event, in the Tribunal’s view, neither of the affidavits provide useful evidence that would have a direct bearing on the relief sought by the City on this Motion.

15The City’s affiant, Haidar Rakban in his July 11, 2023 affidavit provides a summary of what he found upon a review of the file maintained by the City’s Transportation Services Division with respect to the work conducted at the site near the Claimant’s restaurant. He found that two groups of work permits were issued to the Enwave for the period December 10, 2019 to June 10, 2020 and extended to October 29, 2020 and to January 20, 2021. Further permits were issued by the City to Toronto Hydro for the period April 21, 2020 to October 21, 2020.

16Mr. Haidar offered no other testimony in his affidavit about the precise role played by the City in overseeing (or not) construction works carried out under work permits or concerning its responsibilities beyond his statements that:

…The City of Toronto Transportation Services Division is the permit-issuing authority that coordinates construction works conducted within rights-of-way owned by the City of Toronto between contractors, property owners, the City and utility companies.

…Except for construction works performed illegally, construction works by any person, utility company or City division that require occupying a right-of-way or cutting into the surface of a road receive a permit from the City of Toronto Transportation Services Division…

…Any contractor working pursuant to a permit is responsible for ensuring compliance with these…[permit]…conditions… [concerning by-law compliance, signage posting, barracades, hours of work restrictions etc]… as well as more generally ensuring public safety and that work is being undertaken in a reasonable manner.

17In the Tribunal’s view, nothing in Mr. Haidar’s affidavit provides meaningful support for the ultimate remedy sought by the City on this Motion.

18The Claimant delivered an affidavit from its principal, Michael Dabic, sworn July 7, 2023. He described a litany of complaints about the continual disruption to his restaurant premises caused by the works carried out and opined that:

…The construction projects fundamentally changed the dining experience for customers of Michael’s on Simcoe. The restaurant no longer appealed to its clientele as a fine dining establishment while the construction projects were ongoing. Merely as an illustration of some issues that drove away our customers…

… It is clear without any doubt that the City of Toronto, Enwave Energy Corporation, and Toronto Hydro had no regard or concern about the extensive damage and negative impact their careless and negligent actions would have on our restaurant...

… There was no attempt to consult with us in advance on the commencement of construction to discuss how these damages might be minimized and mitigated… Instead, these parties proceeded in a cavalier and uncaring manner, focusing only upon their own needs and their own objectives…

19Clearly, the descriptions and depictions set out in Mr. Dabic’s affidavit contrast sharply with the contentions made by the City’s counsel in its Motion Record and, to some extent, with the points contained in Mr. Haidar’s affidavit. Thus, the evidence filed by the Parties is contradictory and fails to convince the Tribunal that there are ‘no genuine issues’ requiring adjudication (under the summary judgment test in the Civil Rules) or that the Claimant’s action has no reasonable prospect of success (pursuant to section 19.01 of OLTA). There is an obvious dispute between the Parties on the key issues.

THE SUFFICIENCY OF THE ORIGINAL AND AMENDED STATEMENT OF CLAIM

20Of course, the Claimant is not required to prove all elements of its case on this Motion or by way of its Statement of Claim. Ultimately, it must do so at the hearing under the Act. The key is whether there is enough by way of the allegations set out in the now amended Statement of Claim to address the essential requirements of the claims made under the Act.

21In the Tribunal’s view, both the original Statement of Claim and the amended Statement of Claim contain enough of the basic elements of a claim for injurious affection under the Act. This is because both:

(a) Allege that the City and also Enwave undertook extensive construction works in connection with an expropriation commenced under the Act;

(b) Allege that the construction altered the Claimant’s Subject Property and disrupted the Claimant’s restaurant operations;

(c) Plead a quantum of business and personal losses;

(d) Allege that the City and Enwave are jointly and severally liable in respect of the construction works on the basis that the works were for the mutual benefit of both;

(e) Plead that the works were undertaken on City-owned lands and authorized by City permits and that the ‘statutory authority’ for such works was provided to Enwave by the City.

22Again, the proof of the facts pleaded by the Claimant – i.e. the evidence - is not required on this Motion. The City in this Motion is essentially arguing that the Claimant’s allegations are incorrect, but this is not the proper forum in which to fully litigate the merits of Michael’s claims under the Act, based on the opposing contentions set out in the Parties’ motion records. These issues and claims will be explored during the discovery process and will be adjudicated ultimately at the hearing of this proceeding. At the pleading stage, a Claimant does not have to marshal all of the evidence required to prove its cause of action and should not plead that evidence, just the succinct material underlying facts. While the Statement of Claim and amended Statement of Claim are not models of clarity and elegance, they do, in the Tribunal’s view, set out enough of the required elements of the causes of action being pursued by the Claimant.

23As described by this Tribunal in the Don Valley Case, the OLT does not wish to encourage civil motion practice on matters of pleading, nor premature summary judgment proceedings where it is abundantly clear that many key issues – both factual and legal - are hotly contested. This is not a fair, cost-effective and expeditious method to resolve or adjudicate claims under the Act, since it lacks the proper factual and legal underpinning. While it is true that the discovery process can be time-consuming, the Legislature has seen fit to permit it in expropriation cases. Certainly, at a later stage in this proceeding following the completion of discoveries, the City may have successfully elicited admissions and facts that would properly support a future summary judgment motion. The Tribunal is not by this Decision precluding that course of action.

THE MOTION ASSERTS CONCLUSORY STATEMENTS OF LAW AND FACT THAT REQUIRE ADJUDICATION

24Apart from the facts in dispute, the City’s Motion also raises several other legal issues that cannot be properly adjudicated at this time. For example, the City contends that:

Neither the Enwave Works nor the Toronto Hydro Works were undertaken at the direction, supervision, or request of the City of Toronto. They did not involve maintenance or upgrades to City-owned infrastructure… Within the meaning of the Expropriations Act, the City undertook no "construction" and no "work" and therefore it cannot be liable for any injurious affection damages suffered by the Claimant.

25The City’s argument described in paragraph [24] above raises disputed questions of both fact and law. The Statement of Claim and amended Statement of Claim contain the required contrary allegations. There is no sufficient or reliable evidence before the Tribunal on this Motion that could enable it to adjudicate the City’s contentions. This must be explored at the hearing itself (or as indicated, once more fulsome evidence and admissions are obtained through discovery or otherwise).

26After reciting passages from the Electricity Act, 1998, SO 1998, c 15 and the Toronto District Heating Corporation Act, 1998, S.O. 1998, the City also argues:

The City is bound by statute to allow such works to take place within its highways. There is no reasonable prospect for success for an injurious affection claim against the City based on a permit the City was required to issue and utility access it has no statutory ability to oppose…

27Again, these are conclusory assertions of law and fact which cannot be resolved by the Tribunal based on the scant evidence tendered on this Motion. The Claimant included contrary allegations in its pleadings, although perhaps not in as detailed fashion as the City might prefer (but that is not the required standard for such pleadings).

28The City also seeks to frame the Claimant’s action as one seeking compensation for damages “from the City for issuing permits”. However, that is not how either the Statement of Claim or amended Statement of Claim reads. The City’s attempt to so characterize the Claimant’s pleading cannot thereby create proper grounds to dismiss the Claimant’s action. These City arguments - however ultimately valid they might prove to be at a later stage in this proceeding when unequivocally supported by clear and convincing evidence - cannot succeed on this Motion.

SUMMARY AND CONCLUSIONS

29In summary, the issues raised on the City’s Motion are in dispute. The hearing of this Motion is not the appropriate forum because the Tribunal is unable properly adjudicate them since many of the salient facts are in dispute and there are opposing legal arguments at play. Moreover, at the pleading stage in Tribunal proceedings under the Act there is no onus on the Claimant to put forward all of the evidence by which it intends to prove its claim. This is particularly so when the Respondent has not tendered persuasive, uncontested evidence to demonstrate that there is no genuine issue that would require a hearing.

30The Tribunal also wishes to reiterate that its key mandate under OLTA is to focus on procedures and practices which “…in its opinion, offer the best opportunity for a fair, just and expeditious resolution of the merits of the proceedings”. As it has exclusive jurisdiction in respect of all matters in which jurisdiction has been conferred on it under the Act, the OLT has a very broad public interest and adjudicative mandate. Under section 19 of OLTA, the Tribunal has the discretion but not the obligation to dismiss a proceeding without a hearing. The Tribunal’s rule-making power is also broad, and it has chosen not to create highly technical rules and procedures aimed at encouraging motion practice to determine questions of law raised by pleadings or to seek summary judgment. In the Tribunal’s view, such practices are more suited to civil proceedings before the Ontario Court of Justice. While the OLT may have recourse to the Civil Rules as a matter of discretion, it is not bound to import and adopt all of the procedures and requirements set out there, except in limited circumstances.

31Finally, it is of interest to the Tribunal that Enwave has taken no position on the City’s Motion and has not filed materials. Had for example Enwave filed argument or evidence to indicate that it accepts the liability theory put forward by the City (that it alone would bear responsibility for Michael’s claims) then the situation before the Tribunal on the Motion might have been different. But it would be improper for the Tribunal to determine that Enwave’s “silence” on this Motion thereby establishes that the City has no possible liability for the Claimant’s claims. The potential allocation of legal responsibility as between the Respondents remains a matter to be addressed through the discovery process and ultimately at the hearing of this proceeding. The Tribunal notes that on this Motion the City has also not sought a ruling that Enwave alone, by virtue of statutory or contractual requirements or otherwise, must bear sole liability under the Act for all claims in this proceeding.

ORDER

32THE TRIBUNAL ORDERS THAT:

(a) The motion by the City of Toronto to dismiss the claims in this proceeding brought by 2277550 Ontario Inc. o/a Michael’s on Simcoe is dismissed;

(b) There shall be no Order as to the costs of the motion;

(c) All Parties to this proceeding shall work together to prepare a draft Procedural Order on consent and shall advise the Tribunal of their available dates in 2025 for the hearing of this matter, within 20 days of the date of issuance of this Decision;

(d) In the event that the Parties cannot reach agreement on the terms of a draft Procedural Order or on the dates for a hearing in 2025, then they shall submit the details of such disagreement to the Tribunal within 20 days of the date of issuance of this Decision; and

(e) Upon receipt of the submissions described in paragraph [32] (c) or (d) above, the Tribunal, at its discretion, may schedule a Case Management Conference

33This Vice Chair shall remain seized of this proceeding solely for the purpose of assisting the Parties with ongoing case management but shall not be seized in respect of the final hearing.

“William R. Middleton”

WILLIAM R. MIDDLETON

VICE-CHAIR

Ontario Land Tribunal

Website: 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.