Ontario Land Tribunal

Tribunal ontarien de l'aménagement du territoire

ISSUE DATE: April 09, 2026 CASE NO(S).: OLT-24-000435

PROCEEDING COMMENCED UNDER subsection 22(1) of the Development Charges Act, 1997, S.O. 1997, c. 27.

Appellant: Paisley & Whitelaw Inc. Subject: Development charges complaint Property Address: 1098 Paisley Road (1098 Paisley Road.) Municipality/UT: Guelph/Wellington OLT Case No: OLT-24-000435 OLT Lead Case No: OLT-24-000435 OLT Case Name: Paisley & Whitelaw Inc. v Guelph (city)

Heard: February 26 and 27, 2026, by Video Hearing and written submissions ending March 23, 2026

APPEARANCES:

Parties	Counsel
Paisley & Whitelaw Inc. ("P&W" / "Appellant")	J. Meader, J. De Marinis
City of Guelph ("City")	A. Thornton, I. White

DECISION DELIVERED BY S. TOUSAW AND ORDER OF THE TRIBUNAL

Introduction

1This unusual case demonstrates that what may sound simple and straight forward, may well not be. The Parties disagree on whether a development charge was calculated correctly. The complications arise when the facts of this case lead to a question of law.

2P&W lodged a complaint to the City's development charge ("DC") paid for Building C ("C"), being an eight-storey, 138-unit residential building at 1098 Paisley Road, Guelph ("site"). The complainant appealed the City's decision to the Tribunal pursuant to s. 22(1) of the Development Charges Act ("DCA") and seeks a DC refund of $153,932.

3The Tribunal Chair Ordered this Rehearing at the request of P&W on matters relating to the sufficiency of reasons in the first Hearing Decision. The Vice-Chair assigned herein has endeavoured to approach this Hearing de novo with fresh eyes.

4This Decision dismisses P&W's appeal on the Tribunal's findings that: no enforceable prepayment agreement existed; Building C was not included in the original Permit application; and the City calculated DCs correctly for C under the 2019/2021 Development Charges By-law ("DCBL").

5The Tribunal acknowledges the unfortunate, but understandable, belief of P&W that it had been granted "locked-in" DC rates under the 2014 DCBL for the bedroom counts of its 270 units originally proposed, some of which it felt were owed to C. However, the Tribunal underscores that it is bound by law, including the DCA, DCBL, and directions from the Courts, in finding that no implied prepayment agreement existed for C.

6Throughout this Decision, the site's buildings are labelled by their sequence of construction (i.e., "A", "B", "C", etc.). The "previous" DCBL or DCs refers to the 2014 DCBL, and the "current" DCBL or DCs refers to the 2019/2021 DCBL. The Tribunal uses an underline to emphasize elements of quoted text. Some dollar values are rounded for ease of reference.

Preliminary Issue

7At the outset of the Hearing, the City sought the Tribunal's direction to disallow P&W from calling Craig Ferguson as a witness, given that P&W had withdrawn Issue 3 related to interest charges. The City advised that if the Tribunal finds for P&W on all remaining issues, it agrees with the applicable calculations contained in Mr. Ferguson's witness statement, and thus, his evidence is not relevant or necessary.

8P&W responded that procedural fairness would not be met if the Appellant, whose Hearing this is, could not call its only expert witness. Mr. Ferguson's evidence pertains to all remaining issues, which the Tribunal should hear to enable its assignment of weight when rendering its Decision. Disallowing a key witness on this recent request of the City is prejudicial to the Appellant and should have been sought weeks ago through a formal Motion in accordance with the Tribunal's Rules of Practice and Procedure ("Rules").

9The Tribunal denied the City's request, having found that: evidence has not been heard at this Hearing de novo; procedural fairness calls for enabling the Tribunal's full understanding of the issues and positions to enable the consideration of weight; and the City may address its concerns through cross-examination and/or objections. On the latter issue of objections, the Tribunal advised that its findings here may be repeated in related rulings, which did occur once or twice during the Hearing.

10The Parties were directed to focus evidence on the three remaining issues:

1. Did the City and the Appellant enter into a valid and binding Early Payment Agreement under s. 27 of the DCA?
2. Did the City apply the applicable DC rate to the development charges owing by the Appellant for Building C?
3. Is there any refund due to the Appellant, and if so in what amount?

JURISDICTION

11The Ontario Land Tribunal Act ("OLTA"), s. 8(2), grants the Tribunal:

... authority to hear and determine all questions of law and fact with respect to all matters within its jurisdiction ...

12Under s. 9(1) of the OLTA:

The Tribunal has authority to make orders or give directions as may be necessary or incidental to the exercise of the powers conferred on the Tribunal under this or any other Act.

13Pursuant to s. 24(4) of the DCA, upon appeal, the Tribunal may make any decision that City Council could have made under s. 20(6), being to either "dismiss the complaint or rectify any incorrect determination or error that was the subject of the complaint."

14Section 26.2 of the DCA requires the amount of a DC to be calculated at the Site Plan Application ("SPA") stage, which amount is payable at the issuance of a building permit ("Permit").

15The DCA enables a municipality to enter into an agreement with an applicant to pay all or part of the DCs before or after they would otherwise be payable:

27(1) A municipality may enter into an agreement with a person who is required to pay a development charge providing for all or any part of a development charge to be paid before or after it would otherwise be payable.

16The DCs to be applied would be based on the DCBL at the date specified in the agreement, per s. 27(2) of the DCA. If no date is specified, DCs must be paid at the earlier of: the time when any part of the DC is payable under the agreement; or the time when DCs would be paid in the absence of an agreement. The municipality may charge interest on any part of a DC paid after it would normally be payable, per s. 27(3).

17The City's 2014 DCBL included s. 3.15 (Ex. 1, p. 316), which section was not included in the 2019 DCBL (Ex. 1, p. 331) but was later added via the 2021 DCBL update (Ex. 1, p. 355). The 2021 provision enables alternative DC payment timelines:

3.15 Despite section 3.11 through 3.14, Council, from time to time and at any time, may enter into agreements providing for all or any part of a development charge to be paid before or after it would otherwise be payable, in accordance with section 27 of the Act.

18Guiding this Decision are the principles of a fair, just, and expeditious resolution on the merits of the proceeding, as reflected in s. 12(2) of the OLTA and Rule 1.3 of the Tribunal's Rules.

AGREED FACTS

19The Parties agree on the following arithmetic and sequence of events as described in the oral and written evidence, the Agreed Statement of Facts (Ex. 2), and closing submissions. Certain evidence referenced slightly different dates on occasion, but the general sequence below is sufficient to understand the process and timing of events.

• February 5, 2019 Original Site Plan Application ("SPA") SP18-009 approved, with conditions, for foundation and below-grade parking; displayed five proposed buildings and underground parking covering much of the site (Ex. 1, p. 11 & 12);
• February 28, 2019 $4,872,821 Total DC paid by P&W under the 2014 DCBL for 270 units; equates with total units of A and B (SPA Ex. 1, p. 12; Permit p. 36);
  • $508,680 Education DC included in the above total;
  • $4,364,141 Net Municipal DC collected ("original payment");
• March 1, 2019 Building Permit ("Permit") issued for foundation, including below-grade parking (Ex. 5, p. 1); associated drawing showed "Proposed" A and B and "Future" C, D and E (Ex. 1, p. 36); this structure was never built;
• March 2, 2019 2019 DCBL came into force;
• December 13, 2021 2021 DCBL amended the 2019 DCBL
• December 22, 2021 Revised SPA SP18-009 approved with fewer buildings and units and no below-grade parking (Ex. 1, p. 222);
• January 25, 2022 $1,771,788 Foundation Permit issued for A; paid DC from original payment for 105 units at rates in effect on March 1, 2019 (2014 DCBL);
• July 14, 2022 SPA filed for C to which the 2021 DCBL rates were applied;
• August 18, 2022 $2,291,725 Foundation Permit issued for B; paid DC from original payment for 138 units at rates in effect on March 1, 2019 (2014 DCBL);
  • $809,318 Remaining DC payment on account awaiting C, at request of P&W; would cover the DC for 56 one-bedroom units at the 2014 DCBL rate;
• April 19, 2023 Foundation Permit issued for C;
• September 27, 2023 DC paid under protest because City charged current DC rates (2021 DCBL) against the remaining original payment balance;
• October 12, 2023 $2,717,025 Permit issued for superstructure of C; DC for 138 units at rates in effect at SPA of July 14, 2022 (2021 DCBL);
  • $144,696 Interest charged by City on unpaid amount between SPA and Permit, under s. 26.2(3) of the DCA;
  • $2,052,403 DC paid under protest, net of original balance of $809,318;
  • $153,932 Return sought by P&W based on using 2014 DCBL rates from the remaining original balance, and the 2021 DCBL rates on the remaining units (Ex. 3, p. 49).

Party Positions

20Evidence was received from four witnesses.

21P&W called: its owner, Gordon Schembri, to explain the history and rationale for its request; and Craig Ferguson, whom the Tribunal qualified to provide opinion evidence in land economics with a specialization in DCs.

22The City called: Jeremy Laur, Chief Building Official ("CBO"), to explain the building permit process; and Shanna O'Dwyer, Chief Financial Officer ("CFO"), whom the Tribunal qualified to provide opinion evidence in municipal finance.

P&W / Appellant

23The Tribunal summarizes P&W's submissions as follows.

24The overarching legal question to answer in this Hearing is: can P&W rely on the clear representations of the City that P&W would receive the benefit of the secured rates paid for 270 units?

25The Tribunal is asked to find that a prepayment agreement existed and must be honoured by returning a DC overpayment of $153,932 to P&W. In the alternative, P&W requests the Tribunal to find that the City failed in its obligation to communicate clearly and engage predictably by not honouring the DCs paid for a total of 270 units at secured rates across the site.

26The Tribunal's jurisdiction under the OLTA and DCA grants authority for the Tribunal to find that an agreement was formed, as such finding is necessary and incidental to its powers under the DCA when rectifying an incorrect determination of DCs.

27The DC calculated by the City, and paid under protest by P&W, is unfair on its failure to honour a prepayment agreement. While a formal agreement was not established, a "meeting of the minds" is evident on the City's acceptance that DCs would rise only if more bedrooms were included in the final design.

28In 2019, P&W paid DCs of $4.8 million ("M") (including the Education DCs) per the 2014 DCBL for the original Permit application, of which $1.7M was allocated for the revised application A in 2021, and $2.2M was allocated for the revised application B in 2022, all based on the DC rates at the date of prepayment. The remaining prepayment of $809,318 should have been applied to C at the same prepayment DC rates used for A and B. However, the City changed its position and applied the DC rates in force at the time of the SPA for C, resulting in an overpayment by P&W of $153,932.

29P&W refers to the Supreme Court of Canada case, Earthco Soil Mixtures Inc v Pine Valley Enterprises Inc, 2024 SCC 20 ("Earthco"), where it held that the statutory language of "agreement" can exist where the conditions of contract formation are met, including: intention to form contractual relations; an offer that is accepted; consensus or meeting of the minds; consideration – some right, interest, or benefit – passing from one party to another; and certainty of the terms. The terms may be inferred from the parties' conduct, the surrounding factual matrix, and how the words used were reasonably understood. The Tribunal (or its predecessor) has utilized the tenets of acceptance and consensus on the terms of an agreement, e.g., Severn River Development Corporation v Severn (Township) 2021 CanLII 115324 ("Severn") and Brimar Homes Ltd v Lakeshore (Town) [2009] OMBD No 748 ("Brimar").

30P&W submits that these conditions of agreement are met. Its offer, to submit a DC payment for 270 units before the DC rates rose on March 2, 2019, was accepted by the City. Email exchanges confirmed the City's acceptance that rates would not rise unless the bedroom count changed. Senior staff, including the then City Treasurer, had full knowledge of this agreement. The City remitted the education DCs to the school boards for all 270 units, further confirming the agreement that such units would be subject to the DC rates at that time. Such agreement was followed for some 4.5 years, during which the revised plans for A and B were allocated the secured rates, and the City confirmed it would retain the remaining balance "and adjust towards Bldg. C payments" (Ex. 3, p. 66).

31Coincident with Ms. O'Dwyer's involvement, the City abruptly and arbitrarily stopped honouring its obligations for Building C. Mr. Schembri's viva voce testimony confirms these arrangements and the City did not call opposing evidence or the authors of these communications at the City.

32In the alternative, P&W submits that the City failed its obligation to provide finality and predictability in its imposition of DCs. When P&W requested the City to retain the remaining funds to utilize the secured rates, the City did not advise that it intended to apply the current rates to the remaining funds in reserve at such time as a future application was filed. The City's actions in utilizing the original payment for A and B demonstrates its acceptance that DCs had been prepaid for 270 units. That acceptance was inexplicably halted for C. The City should be bound by its representations, whether or not the Tribunal finds that a prepayment agreement existed.

33Thus, P&W argues that the City did not apply the applicable DC rates for C. The remaining balance of the original payment at the 2014 rates should have been allocated to C, until exhausted. The remaining units in C would pay DCs at the rate in effect at SPA for C. With the DCs paid under protest, the difference of $153,932 should be refunded to P&W.

34The City has benefitted from the interest earned on the remaining prepayment since 2019 and from applying the higher DCs to those remaining funds on record. At the same time, P&W was unfairly denied the benefit of the secured rates.

35P&W requests the Tribunal to rectify the City's incorrect determination of DCs and Order a refund of $153,932, plus interest pursuant to s. 25(2) of the DCA.

City

36The Tribunal summarizes the City's position as follows.

37The City submits that the formation of a binding agreement is a question of law under the DCA and the City's DCBL. The DCBL requires City Council's express approval for an alternative DC arrangement, which was neither sought nor granted here. A prepayment agreement was not discussed or agreed to by City staff in 2019 when the DCs were remitted for A and B. Building C was not addressed by the original Permit.

38The DCs utilized at the foundation Permit stage for A and B predated the new DCBL that took effect on March 2, 2019. The balance of the original payment was held on account at P&W's request and applied to the applicable DCs under the 2019 DCBL for C.

39The outcome in this case must be determined by law. The agreement sought by the Appellant is not possible in law. The sole discretion for a DC agreement rests with City Council under the DCA and the DCBLs. On a complaint, the Tribunal may correct a misapplication of a DCBL but it cannot change a DCBL's requirements. In the absence of a prepayment agreement, DCs must be paid at the rates in effect at the time of SPA.

40Mr. Laur, CBO, confirmed in evidence that the original Permit authorized the foundation, below-grade parking structure, and two 8-storey buildings, for which the DCs were calculated on 270 units. The Permit did not authorize the other future buildings shown on the Site Plan, and the extensive foundation/parking structure did not form part of what would later become C. The Permit authorized the parking structure and A and B until that Permit was later cancelled and replaced. The owner changed its plans for A and B for which new Permits were issued, and the original DC rates were utilized.

41The remaining paid funds were held on account at P&W's request to be utilized for C. Interest was credited to those held funds and interest owing between SPA and the Permit was not charged against P&W's remaining DC funds on account.

42The City underscores that the courts have established that municipalities are not subject to the "indoor management rule" that binds private corporations to the actions of their staff. Despite what P&W perceived from its communications with City staff, no agreement was endorsed by City Council as required by the DCBL, and City staff have no authority to bind the City and/or Council.

43Among other cases referenced, the City highlights Sherway Contracting (Windsor) Ltd. v. Kingsville (Town), 2002 CanLII 9291, 2002 Carswell Ont 4423 [2002] O.J. No. 4938 (Ont. S.C.J.) ("Sherway Contracting"):

One principle is clear and runs throughout all of the cases involving municipal agreements: a person entering into contractual relations with local authorities cannot assume that all of the proceedings respecting the authorizing of the contract have been properly taken and that capacity to enter into the contract exists. Parties dealing with a municipal corporation are bound at their peril to take notice of the limits within which and the manner in which, the council has power to contract and bind the corporation. ...The law places the burden of seeing that all mandatory provisions of the governing statute are substantially complied with upon the party dealing with the corporation.

44The City submits that neither of the Severn and Brimar cases, relied on by P&W, found that a prepayment agreement existed. Further, para. 64 of the Severn case emphasizes the necessity of:

express acceptance of a proposed element of the agreement, such that a consensus between the parties as to that specific term of the agreement is proven.

45There must be clear and incontrovertible evidence that shows the City entered into a prepayment agreement with P&W. The alleged acceptance between the Parties is neither "express" nor "proven."

46The Tribunal is asked to accept the evidence of Ms. O'Dwyer, being the only qualified witness to opine on whether a prepayment agreement existed. Ms. O'Dwyer explained that even she, as CFO, does not have authority to bind Council on this issue given the clear wording of s. 3.15 of the DCBL.

47The staff involved had no such authority and their email referred the matter to the Finance Department. Mr. Schembri agrees that he did not formally request a prepayment agreement, and that no such agreement was entered into with Council. Mr. Laur interprets staff's email as confirming that existing DC rates would apply if changes to the original Permit involved a different mix of units. He advised that the foundation in the original Permit had no connection to "Proposed Building C" outlined on the Site Plan. DCs were calculated by Finance for the 270 units in A and B shown on the Site Plan and as reflected in the Architect's drawings filed in support of the requested Permit.

48The City disagrees that a repayment to P&W is warranted for C. However, the City does not dispute the calculation of the amount sought for repayment by P&W, should the Tribunal find for the Appellant.

49The City concludes that the Tribunal has authority to correct a misapplication of the DCBL, but it cannot change the DCBL's requirement that a binding agreement requires Council's approval. The case law is clear that, unless a Council power has been delegated to staff, the absence of Council authorizing an alleged commitment is fatal to its validity. The City pursues fairness to the public through carefully calibrated and rising DCs, with prepayment being the exception and warranting full review by Council.

Analysis and Findings

50Fundamental to this case is whether P&W's original DC payment can be construed as being based on a prepayment agreement, or at least a consensus with the same result, that effectively locked-in DC rates for 270 units at the time of payment. The Tribunal finds that two routes may lead to the Appellant's desired result: the existence of a legally binding agreement through the actions of City staff; or the connection between the original 2019 Permit and the later 2023 Permit for C. Unfortunately for the Appellant, the Tribunal finds that neither route leads to a DC refund.

51The Tribunal observes that much of this dispute relies on two opposing views: P&W underscores that the original Permit engaged all proposed buildings such that any remaining DC payment may apply to C; whereas the City stresses that the prepaid DCs for 270 units equate with, and applied only to, the original versions of A and B.

Legal Issues

52To the Parties' detailed legal arguments, the Tribunal finds that when "standing in the shoes" of City Council through a DCA appeal, the Tribunal may decide on whether a de facto prepayment agreement can or does exist, and if found to exist, may implement such agreement through the DC calculation. On a plain reading of the DCA, the Tribunal may render any decision that City Council could have made. Although Council denied P&W's complaint, it could have arrived at the opposite conclusion and authorized a retroactive prepayment agreement. Thus, the Tribunal could arrive at a similar conclusion. It does not, however, because the City staff's unfortunate written inferences do not result in a clear agreement, and for which they lack authority to authorize. In addition, if an agreement were found to exist, it would apply only to A and B, and not to C, based on the facts of the original SPA and Permit.

53If the Tribunal were found wrong in law on its jurisdictional and case law findings, and an agreement were found to exist, it also finds that such potential arrangement had no material connection to C. This case can turn solely on the factual contents of P&W's original SPA and Permit applications that, in turn, resulted in the current DC rate being applied correctly to C.

54Section 3.15 of the 2021 DCBL is authorized by s. 27 of the DCA. The DCA allows a "municipality" to enter into the agreement, and the DCBL more narrowly stipulates that "Council" may enter into an agreement. The Parties accept, and the Tribunal agrees, that Council did not authorize an agreement under s. 3.15 of the 2014 DCBL when the original payment was remitted by P&W.

55Just prior to submitting its DC payment in 2019, P&W asked, via email, for confirmation from City staff (Ex. 3, p. 77):

... that regardless of any changes to shape or sizes of the buildings built, as long as the bedroom count does not change, we will not be susceptible to the increased development charges, and that the only way the DC's go up for this phase is if we add more bedrooms. In that case the extra bedrooms would be charged at the current rate at the time? Please confirm.

56After further email exchanges, City staff responded to P&W (Ex. 3, p. 75):

The email ... from [P&W] ... appears correct.

However ... questions regarding the Development Charge By-law should be directed to our Finance department.

57Satisfied with the response, P&W submitted what it considered as a DC prepayment. While the City disagrees that such was the result, the next steps reconfirmed P&W's interpretation.

58P&W's plans for the site changed dramatically and new Permits were obtained for A and B, three years after the original DC payment. The City utilized the 2014 DCBL rates for A, and although originally calculating current DC rates for B, it reverted to the 2014 rates upon questioning from P&W.

59Thus, the Tribunal finds Mr. Schembri's viewpoint and understanding – based on the above email exchanges and the DC rates utilized – to be fair and reasonable. His understanding appeared to be confirmed by City staff, albeit with the caveat that the Finance department should be consulted. To that end, the Tribunal finds that the emails copied to Finance staff, without responses from them, amounts to the City's full acceptance that 2014 DC rates continued to apply, as was later implemented for A and B.

60A similar result occurred through email correspondence in 2022. Mr. Schembri advised (Ex. 1, p. 272):

I'm OK with keeping that amount on credit for the lower amounts on units in building C if the city chooses.

61Following clarification on the proposed size and residential use of C, the City responded, without any issue with Mr. Schembri's reference to "lower amounts" (Ex. 1, p. 270):

... We can retain the balance and adjust towards Bldg. C payments.

62Ms. O'Dwyer opined that the City may have been incorrect when it allowed the 2014 DCBL rates for both A and B. The Tribunal finds that therein lies the City's dilemma when addressing this appeal. It established the trajectory for P&W's belief of the locked-in DC rates by allowing and honouring what seemed to be a prepayment agreement. The City's acceptance of those rates for A and B confirmed for P&W what it had understood from previous correspondence: that the original rates would apply until the prepayment was fully spent, i.e., until more bedrooms were proposed. Ms. O'Dwyer's admission of the City's change in approach is found to have halted what had become P&W's clear understanding of the DC prepayment.

63However, the Tribunal considers the caveats "for this phase" in the original email, and "if the City chooses" in the later email, as key words of P&W that align with and support Mr. Laur's explanation that the original payment applied only to the original Permit. The City's evidence interprets this email exchange as applying to A and B only. If more bedrooms were added at the superstructure Permit stage for A and B, then the same DC rates would apply. This position is aligned with the Tribunal's finding below. The disassociation of C, in both time and space, from the original SPA and Permits for A and B, cause the Tribunal to find that any prepayment, rightly or wrongly applied to A and B, does not carry forward to C.

64The Tribunal accepts the legal argument advanced by the City via Sherway Contracting that its staff cannot, in law, bind the City Council and/or the Municipal Corporation when a particular authority has not been delegated to staff. The Tribunal's ultimate finding herein aligns with this case, but again, the Tribunal also finds that it need not rely or focus on the email exchange alone. The email exchange is unfortunate but found to not be determinative of an agreement, given the ambiguity contributed by both Parties. What is clear is the basis upon which the 270 units were used to calculate the original DC payment.

65Aligned with the foregoing premise in Sherway Contracting, the DCBL expressly stipulates that "Council ... may enter into agreements ..." (Ex. 1, p. 355). Such agreement was neither approved nor even considered by Council, as its awareness of this issue first arose via the Appellant's filed complaint to the City. The Tribunal accepts Ms. O'Dwyer's evidence that even as CFO, she is not entitled to engage in or implement an agreement without Council's express approval.

66P&W focussed on the Brimar and Severn cases, neither of which the Tribunal found in favour of the appellant when examining the sequence of events that led to the disagreement. The Tribunal accepts that Severn is demonstrative of an in-depth analysis of correspondence and circumstances related to the issue, which the Tribunal has endeavoured to do here for P&W's appeal. Another cited case, Earthco, addressed the plain meaning of words to decipher the objective intention of the parties, although it did not involve a municipality as addressed by Sherway Contracting. The Tribunal was not provided a case or legal argument from P&W that Sherway Contracting should not be considered here, being the inability of City staff to bind Council to an agreement.

67P&W argues that the alternative rationale to a prepayment agreement is the City's obligation to communicate clearly and to be transparent, with reference to both Sherway Gate Development Corp. v. Toronto (City), 2013 O.M.B.D. No. 489 ("Sherway Gate") and Grerei Investment Limited v Waterloo (Region), 2019 CanLII 115467 (ON LPAT). Again, the Tribunal finds that unfortunate assumptions appear to have been present on both sides, where P&W assumed it was locking-in DC rates for 270 units, whereas the City may have assumed the questions related to A and B only. The Tribunal accepts that the City could have and should have been clear and precise, but finds that these imperfections do not rise to a miscalculation of DCs for C. As reviewed below, C had no effective presence in the original SPA and foundation Permit.

68The Tribunal accepts P&W's assertion that the City staff made administrative decisions that run contrary to the City's argument that staff has no binding authority. Examples not expressly supported by the DCBL are: the initial 2021 DC rates applied to B were reduced to the 2014 rates upon request of P&W; and the CFO chose an interest calculation on the remaining DC payment on account. The Tribunal also notes that staff had delayed the DC payment for C to the superstructure stage. Again, while these actions lend weight to P&W's position, the Tribunal has no basis to disregard Sherway Contracting and, as addressed below, C's connection to the original SPA and Permit is insufficient to find a prepayment for C.

69As a related procedural matter, during reply oral evidence, the Tribunal disallowed an objection from P&W and allowed Ms. O'Dwyer to opine on whether she considered that a prepayment agreement existed. Ms. O'Dwyer replied that "there have been no agreements under s. 3.15 since I joined the City."

70The Tribunal accepts P&W's closing argument that weight should not be given to an expert's opinion when it addresses clearly the ultimate issue at play. As stated in Raponi v. Olympia Trust Company, 2022 ONSC 4480:

It is inappropriate for a witness to provide evidence that constitutes argument on the issues that are to be decided by the Court. ... When an expert's opinion approaches an ultimate issue, the trier of fact should exercise special scrutiny.

71However, the Tribunal finds a subtle difference between a question of law and an expert's day to day practices. Ms. O'Dwyer understands the DCBL provisions, and practices daily on their implementation. As such, it is not surprising or unusual that this CFO has an opinion on when, where, and how an agreement is formed. Thus, as is obvious in this case, the City denies that such agreement exists, and such position is based, in part, on the opinion of Ms. O'Dwyer.

72The Tribunal, however, is responsible for the question of law, for which it will not give weight to the CFO's opinion. Aligned with such finding is the evidence of Mr. Ferguson who expressly avoided any conclusion on the existence of an agreement. Again, a witness may have an opinion on a practical matter, but the associated legal question rests with the Tribunal.

Applicable DC Rates

73The Tribunal finds for the City that the original payment submitted in 2019 had no meaningful DC connection to the eventual Permit for C in 2023.

74The common City process for when and how DCs are calculated was largely uncontested in evidence. DCs are owed at the time of SPA but payment is not required until a Permit is requested for issuance. With the building details known through the Permit application, DCs are confirmed and interest is charged on that amount back to the SPA date. The SPA shows the anticipated site layout, but the Permit confirms what is to be built, and upon which DCs are calculated.

75The original SPA was conditionally approved on February 5, 2019, showing five proposed buildings, A through E (Ex. 1, p. 12) (or seven buildings as noted by Mr. Laur in oral evidence). While the signed SPA appears limited to only Ex. 1, p. 11 and 12, the associated p. 29 drawing, among others, displays "Building A" and "Building B", and "Future Building" for C, D, and E. The Foundation Plan on p. 31 displays buildings A and B and an extensive below-grade parking area, which does not extend northward under C. This fact is confirmed on the signed approval of the SPA (Ex. 1, p. 12) marked as "Extent of Underground Parking". Thus, the conditionally approved SPA for "Foundation Only" (ibid.) did not apply to C, despite C being shown conceptually on the site along with other proposed buildings. Moreover, the original SPA (SP18-009) was later amended or replaced on December 22, 2021, showing only A and B as "Proposed" and the area eventually used for C as "Sodded Area Until Future Development" (Ex. 1, p. 222).

76The foregoing finding is corroborated by the original Permits sought for A and B (Ex. 1, p. 35 – 62) that were dated January 18, 2019, generally coincident with the SPA. Again, A and B are marked "Proposed" and C, D, and E are labelled "Future". The detailed Permit plans depict only A and B and the below-grade parking, with no details for Future Building C.

77The Tribunal finds that the foregoing documents are applicable when interpreting the terminology used on the issued Permit. As displayed in Ex. 5, on March 1, 2019, the City issued an "ICI Foundation – Building Permit" noting "Apartment Building" and "Foundation Only – 2 levels of U/G Parking". The Permit references the Applicant as "ABA Architects Inc." being P&W's apparent lead consultant for its filed plans. P&W's application for Permit cites the "Description of proposed work" as (Ex. 5, p. 2):

Foundation and U/G plumbing only – 8 storey apartment buildings with 2 levels of underground parking.

78The Tribunal finds that the reference to "buildings" relates only to A and B, and not to C as suggested by P&W. DCs were calculated and charged based on the number and type of units proposed at that time for A and B: 270 units. Such calculation by the City was based on, conformed with, and granted the Applicant's request. The much larger below-grade parking garage approved in the original Permit did not extend to the location of C. The Permit application and its DCs had no connection to "Proposed Building C" in 2019, and thus, are found to have no connection to C when later granted a Permit in 2023.

79P&W argues that the original Permit was cancelled and yet the City still allowed the original payment to cover A and B's DCs, such that it should apply similarly to C. The Tribunal finds on Ms. O'Dwyer's evidence that, while the City staff may have been not following the DCBL correctly when allowing the calculations based on the 2014 DCBL, staff appeared to be honouring the original payment for A and B because those were the buildings for which DCs were specifically calculated and paid. The Tribunal finds that, right or wrong, staff were endeavouring to be fair given the original payments were for A and B. In contrast, C was not a component of the original DC calculation or payment.

Summary

80It is clearly unfortunate that P&W's communications with staff led it to believe that the remaining original payment would also apply to the next building, which became C.

81Nevertheless, the Tribunal must find for the City. The courts have established that for municipal interactions, the onus rests with the developer to ensure that an agreement exists. Neither a formal agreement nor a de facto agreement is found to exist. The Tribunal understands the frustration that this may induce, but the Tribunal, like the Appellant, is bound by the law.

82Second, while City staff's emails can be interpreted as misleading P&W and should have been more clear, it is somewhat saved by the various caveats used by both Parties. P&W argues that those copied on the emails were obligated to clarify any inaccuracies, which they did not. The Tribunal finds that P&W, similarly, did not seek confirmation, as the law directs and requires it to do.

83Of significance, the Tribunal finds that the original Permit and associated 2014 DC rates applied only to A and B. Building C has no connection to the originally proposed 270 units in A and B.

84The Tribunal concludes that the City calculated the DCs correctly in accordance with the DCA and the applicable DCBL. No refund is warranted.

85To Mr. Schembri's written request (Ex. 3, p. 70), the Tribunal will not hear a Cost Motion for this case. The Tribunal acknowledges the well-intentioned approach of both Parties and finds that the nuances of this case enabled each Party to advance a reasonable position, which they both did in a professional manner.

ORDER

86THE TRIBUNAL ORDERS, pursuant to s. 24(4) of the Development Charges Act, that the appeal is dismissed.

"S. Tousaw"

S. tousaw

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.