Ontario Land Tribunal

Tribunal ontarien de l’aménagement du territoire

ISSUE DATE:

February 02, 2026

CASE NO(S).:

OLT-25-000173

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

Appellant:

Sarah Gairdner

Description:

Determination of the development charges

Reference Number:

DCOLT-2025-001

Property Address:

860 19th Sideroad

Municipality/UT:

King/York Region

OLT Case No.:

OLT-25-000173

OLT Lead Case No.:

OLT-25-000173

OLT Case Name:

Gairdner v. King (Township) et al.

PROCEEDING COMMENCED UNDER subsection 10(1) of the Ontario Land Tribunal Act, 2021, S.O. 2021, c. 4, Sched. 6

Request by:

Sarah Gairdner

Request for:

Request for Directions

Heard:

December 11, 2025 by written motion

APPEARANCES:

Parties

Counsel

Sara Gairdner

Michael Foderick

Jamie Cole

Regional Municipality of York

Mercedes Mueller

Township of King

Alexander J. Suriano

Tom Halinski

Jasmine C.M. Fraser

DECISION DELIVERED BY A. MASON AND ORDER OF THE TRIBUNAL

Link to Order

INTRODUCTION

1This is the decision arising from a written Motion for Directions considering the legal question of whether a new standalone residential building on a parcel of land where there is an existing main residential building qualifies as a second residential unit eligible for the exemption from development charges in s. 2(3.3)1 of the Development Charges Act, 1997, S.O. c. 27 (“DCA”)

2The Motion is brough pursuant to an appeal under s. 22(2) of the DCA regarding the lack of a decision by the Township of King (“Township”) and the Regional Municipality of York (“Region”) (together, “Responding Parties”) with respect to complaints made under s. 20 of the DCA (“Complaints”), for the property located at 860 19th Sideroad, Township of King (“Property”) owned by Sara Gairdner (“Moving Party”).

3The Property is approximately 53 acres in size, comprised of a woodlot and agricultural fields and contains one existing single detached dwelling of approximately 1,700 square feet (“Existing Dwelling”). In 2023, the Moving Party applied for, and received, zoning approval to build one additional single detached dwelling of approximately 5,100 square feet on the Property (“Future Dwelling”). The Future Dwelling requires separate septic, hydro and gas services. The Moving Party intends to reside in the Future Dwelling and retain the Existing Dwelling to be repurposed into a farm help residence.

4Having received zoning approval, the Responding Party applied for a building permit to construct the Future Dwelling and received a “Development Charges – Receipt Request” (“DC Receipt”) from the Region and Township under the DCA for $99,663.00 determined to be owed prior to issuance of the permit, constituted as follows:

a. $54,742.00 in Region DCs; and

b. $44,921.00 in Township DCs.

5The Moving Party did not pay the DC Receipt, taking the position that it was issued in error because the Future Dwelling is exempt from the payment of development charges pursuant to s. 2(3.3)1 of the DCA.

6Section 2(3.3) sets out a series of exemptions for additional residential units in new residential buildings where s. 2(3.3)1 is as follows:

Exemption for additional residential units in new residential buildings

2(3.3) The creation of any of the following is exempt from development charges:

1. The second residential unit in a new detached house, semi-detached house or rowhouse on a parcel of land on which residential use, other than ancillary residential use, is permitted, if all buildings and structures ancillary to the new detached house, semi-detached house or rowhouse cumulatively will contain no more than one residential unit.

7The Responding Parties disagreed that the Future Dwelling qualified for the exemption under s. 2(3.3)1 of the DCA and maintained that the DC Receipt must be paid prior to issuance of a building permit.

8In November 2024, the Moving Party submitted the Complaints to the Council of the Township and Region respectively, pursuant to s. 20 of the DCA. The Responding Parties took the position that payment of the DC Receipt by the Moving Party was a precondition for their respective Councils to consider the Complaints. Due to the refusal or neglect of the Councils to make a decision within the statutory 60 days, the Moving Party appealed the Complaints to the Tribunal pursuant to s. 22(2) of the DCA.

9At a first case management conference on this matter in July 2025, it was clear there was a fundamental disagreement between the Parties whether payment of a development charge is a prerequisite for bringing a complaint under s. 20 of the DCA, and by extension, whether the Appeal by the Moving Party of the non-decisions of its Complaints, was validly before the Tribunal. As such, a written Motion for Directions was ordered concerning the narrow question of whether the Tribunal had the jurisdiction to hear the Appeal of the Complaints. On August 29, 2025, the Tribunal released its decision confirming that payment of a development charge is not a prerequisite under the DCA for bringing a complaint and, therefore, the Appeal was validly before the Tribunal.

10This written Motion for Directions has been set down at the request of the Moving Party to determine the substantive legal question at the centre of the Appeal of whether the Future Dwelling is exempt from payment of development charges pursuant to the exception in s. 2(3.3)1 of the DCA. The Moving Party seeks an Order from the Tribunal declaring that s. 2(3.3)1 of the DCA applies to the Future Dwelling and that no development charges are owed. The Responding Parties seek an Order from the Tribunal declaring that the exemption in s. 2(3.3)1 does not apply to the Future Dwelling, and as a result, the DC Receipt must be paid to obtain a building permit.

11Having reviewed and considered the submissions of the Parties, the Tribunal finds that the exemption in s. 2(3.3)1 of the DCA does not apply to a second residential unit on a parcel of land where that unit is a standalone new building. As a result, the Future Dwelling is not exempt from the payment of development charges pursuant to s. 2(3.3)1 and the Tribunal dismisses the Motion.

DOES S. 2(3.3)1 OF THE DCA APPLY TO A NEW STANDALONE RESIDENTIAL BUILDING?

12When considering a question of statutory interpretation, the Tribunal is guided by the Supreme Court’s decision in Rizzo & Rizzo Shoes Ltd. (Re), 1998 CanLII 837 (SCC), [1998] CanLII 837 (SCC), 1 S.C.R 27 (Rizzo) that is ubiquitous for the principle that the words in legislation are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the legislation, its purpose and the intention of the legislature. As an administrative body, the Tribunal is further directed by the Supreme Court in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, [2019] 4 SCR 653 at paragraph 118 which establishes that “…whatever form the interpretive exercise takes, the merits of an administrative decision maker’s interpretation of a statutory provision must be consistent with the text, context and purpose of the provision” [emphasis added]. As such, in this decision, the Tribunal considers the legal submissions of the Parties to come to its determination of the text, context and purpose of s. 2(3.3)1.

Agreed facts between the Parties:

13In their legal submissions, the Parties agree that the purpose of the development charge regime under the DCA is to pay for the increase in capital costs associated with increases in development. Under s. 2(2) of the DCA, development charges may be imposed in relation to a building or structure where a building permit is issued.

14The Parties also agree that s. 2(3.3) of the DCA came into force through the More Homes Built Faster Act, 2022 (“Bill 23”) that had the legislative objective of responding to the provincial housing affordability crisis by removing barriers to the creation of more housing units. One way that Bill 23 sought to meet its objective was to encourage “gentle density” by allowing up to three residential units on a residential lot in the form of an extra apartment (basement or otherwise), garden suite or coach house, or a similar form of development.

Position of the Moving Party:

15The primary thrust of the Moving Party’s position is, pursuant to s. 2(3.3)1, the second unit exempted from development charges may be the new (main) residential building itself on the parcel of land The Moving Party submit that the Future Dwelling meets the legislative intent and criteria of the exemption in s. 2(3.3)1 because:

1. There is an existing house on the Property that will continue to be used for a residential purpose (the Existing Dwelling);

2. A second residential unit is being built in a new detached house (the Future Dwelling itself);

3. Residential uses are permitted on the Property; and

4. The existing residential building (Existing Dwelling) that will be ancillary to the new detached house (Future Dwelling) contains no more than one residential unit.

16The Moving Party submits that their interpretation is consistent with the use of “residential unit” in the DCA and within the other subsections of s. 2(3.3) which contemplate other exemptions for new residential units, such as standalone garden houses in s. 2(3.3)3. The Moving Party submits that “residential unit” as used in the DCA may encompass an entire house and to interpret it otherwise with respect to s. 2(3.3)1 would undermine the legislation since:

1. All references to “residential unit” in the DCA would have to be interpreted not to include a standalone building with the result that it would curtail the applicability of large parts of the legislation to units in multi-residential buildings; and

2. Such an interpretation would also exclude garden homes which the Responding Parties acknowledge in their submissions are permitted exemptions under s. 2(3.2)3 and s. 2(3.3)3.

17The Moving Party further submit that, since the Future Dwelling requires private servicing and will not connect to municipal services, exempting it from development charges does not conflict with the overall intention of the DCA to fund the capital costs of new development through development charges.

Position of the Responding Parties:

18The Responding Parties dispute the Moving Party’s interpretation set out in paragraph [15] as improperly segmenting the provision and reading the words into it. In their submission, the Township sets out what they consider to be the enumerated requirements in s. 2(3.3)1, as follows:

1. There must be a second residential unit in a new detached house, semi-detached house or rowhouse;

2. That unit must be on a parcel of land on which residential use (other than ancillary residential use) is permitted; and

3. The ancillary buildings and structures to the new detached house, semi-detached house or rowhouse cumulatively will contain no more than one residential unit.

4. In sum, to qualify for the exemption in s. 2(3.3)1, a new residential building must be created and, within that building, an additional unit (in order to increase the supply of housing through the provision of more than one unit in a new building).

19The Responding Parties interpret s. 2(3.3)1 such that the exemption only applies to a second residential unit in a new detached building, such as a basement apartment, not an exception for the building of the new residential dwelling. The Responding Parties point out that their interpretation is consistent with the title of the exemption as “Exemption for additional units in new residential buildings”.

20When looking at the overall language in s. 2(3.3), the Responding Parties submit that it exempts the creation of a “second residential unit in a new detached house, “a third residential unit in a new detached house”, or “one residential unit in a building or structure ancillary to a new detached house” where there is a new building. They submit, however, that it does not exempt the creation of one residential unit as a new detached house, particularly where the new house is the primary dwelling on the lands.

21In their submission, the Township put forward that if the legislature had intended for a new house containing a single residential unit to be exempted from development charges, it could have used language such as “one residential unit in a new detached house…”, “first residential unit in new detached house…” or “second residential unit as a new detached house…”. However, the legislature chose to set out that only a second or third unit in a new building is exempted or a unit in an existing ancillary building where there is also a new building. As a result, the Township submitted that the Future Dwelling only contains one residential unit and does not qualify.

22The Responding Parties submit that their interpretation of the provision is consistent with the purpose of the DCA for to pay for increased capital costs required because of the increased need for serviced arising from new. To this end, they submit that exempting the additional unit within a house from development charges is consistent with the objectives of the DCA in s. 2(1) because adding a unit within a house that is already serviced will not necessarily increase the need for services. They submit that in contrast, a substantially larger house than the existing dwelling will increase the need for services.

23The Township disagreed with the Moving Party’s assertion that “residential unit” may encompass an entire house and is supported by reference to the intent of the parallel provision in s. 2(3.2) for units in existing houses. To this, the Township set out the position that s. 2(3.3) and s. 2(3.2) are parallel provisions that are almost identical except for the reference to “new” versus “existing” house and should be read as such. From this the Township asserts that when reading s. 2(3.3) and s. 2(3.2) together, it is even more clear that the residential unit refers to a unit within a new house, not the entire house itself.

24The Responding Parties support their position that the legislature did not intend s. 2(3.3)1 to allow the exemption of an entire new house with Hansard transcripts, including a quote from Michael Parsa, then Associate Minister of Housing:

If passed, our proposed legislation would allow, as of right, up to three

residential units on most land that is currently zoned for one home in

residential areas. This would be allowed without the need for a municipal

bylaw amendment. Depending on the property in question, these three

units could all be within the existing residential structure, or, for

example, they could take the form of a main home with an in-law or

basement suite, or a laneway or garden home. Of course, these new

units would need to be compliant with the building code and with the

relevant municipal bylaws. I’m proud to say that these units would be

exempt from development charges and parkland dedication fees. [emphasis added]: Legislative Assembly of Ontario, Hansard Transcript, November 23, 2022, vol. A, at 0920]

25The Township also provided the following Hansard quote as instructive to the government’s intention for the exception:

We have the capacity in our province to allow for more gentle density in areas where it makes sense. Our proposed changes will permit up to three units—that’s up to three units in the main building, or up to two in the main building plus one unit in a smaller building—on most pieces of urban land without needing a bylaw amendment to permit these added units. The example I’ll use is, a property owner could have a main residence with a basement and attic apartment or an apartment in the main residence plus a garden home [emphasis added]. Legislative Assembly of Ontario, Hansard Transcript, October 26, 2022, vol. A, at 0910]

26The Responding Parties submit the Hansard transcripts demonstrate the intent of the exemptions introduced by Bill 23 to support the development of up to three residential units on a parcel of land in the form of an extra apartment (basement or otherwise), garden suite or coach house or similar form of development, in a new building on a residential lot to increase the supply of affordable housing and gentle density not a new main single residential building itself.

27Lastly, in response to the fact that the Moving Party intends the Existing Dwelling to be retained as a “farm help residence”, the Responding Parties submit this is irrelevant to the consideration of whether the exemption in s. 2(3.3)1 applies.

Analysis

28To begin, the Tribunal notes that the Parties did not provide case law considering s. 2(3.3)1 in their submissions, presumably because of the relative infancy of the provision and none exists. The Parties did provide references to Hansard transcripts as noted earlier wherein the legislature considered Bill 23. In coming to its decision in this Motion, the Tribunal has taken the Hansard transcripts into account as an extrinsic aid or secondary source to provide “colour” and gives them such weight accordingly.

29Additionally, the Region provided affidavit support for their legal submissions from Fabrizio Filippazzo, Manager of Development Financing at the Region, and the Township provided affidavit support from Christel Gregson, CPA, CMA, and Manager of Revenue at the Township, in support of their legal submissions. While the Tribunal notes the professional experience of both witnesses, it gives little weight to their assertions on the legal interpretation of s. 2(3.3) in arriving at its decision because statutory interpretation is ultimately a responsibility exercised by the Tribunal, not a witness.

30The Tribunal finds the ordinary language meaning of s. 2(3.3)1 addresses a scenario where a new building has a second unit in the building that would be exempt, and there may be an ancillary building or structure with only one unit, for a maximum total of three units on the parcel of land. The criteria relating to whether the unit is the “second residential unit,” in my view, therefore relates to whether a unit is the second one in a building, and not just whether it is the second unit on a property.

31With respect to the claim by the Moving Party that the exempted second “residential unit” in s. 2(3.3)1 must be read to include a separate standalone building such a garden home or risk undermining its meaning in the DCA, the Tribunal disagrees. The scenario of the second residential unit being in a standalone building is captured in s. 2(3.3)3, which contemplates an exemption for a residential unit in a building or structure that is ancillary to a new building, or in s. 2(3.2)3 for a unit in an ancillary building where there is an existing residential building.

32The Tribunal finds that 2(3.3) methodically sets out three separate scenarios for a development charge exemption where there is a new residential building being built: (1) a second unit in the new building (s. 2(3.3)1); (2) a third unit in the new building (s. 2(3.3)2); and (3) one unit in an ancillary building (i.e. garden home)(s. 2(3.3)3). In all three scenarios, there is a new building and then an exemption is provided when adding a unit to that building or to an existing ancillary building, for a total of three residential units on the parcel of land. In other words, “build one new unit, get one unit (development charge) free”.

33Beyond the ordinary meaning of the provision, the Tribunal is persuaded by the Responding Parties’ submissions as to the context and purpose of the exemption. The Tribunal finds the Hansard transcripts evidence that the legislature contemplated up to three new units could be on a parcel of land where the second (and possibly third) may be exempt from development charges under s. 2(3.3)1 to further the legislative goal of increasing housing through “gentle intensification”. The Hansard transcripts further indicate that the legislature intended that upon building one new unit, up to two additional units could be development charge exempt. The characterization of “build one, get one (development charge) free” does not fit the facts of the case at hand. A second unit in the Future Dwelling would qualify for a development charge exemption but the Future Dwelling itself does not.

34The contention by the Moving Party that, because the Future Dwelling requires private servicing, their interpretation that it qualifies as the exempt second residential unit is in alignment with objectives of the DCA and Bill 23 is not persuasive. Merely because the facts of this case do not require added municipal services without cost implications to the Township or Region does not lend support for a global interpretation of the exemption in s. 2(3.3)1 as applying to a new standalone building.

35Lastly, the Tribunal agrees with the Responding Parties that the proposed use of the Existing Dwelling as a farm help residence has no impact on the legal interpretation of s. 2(3.3)1; however, in reviewing the Moving Party’s Notice of Motion, the Tribunal considered the inclusion of this fact as an incidental detail and not a submission germane to their argument.

36In summary, the Tribunal finds that s. 2(3.3)1 provides that up to three units may be constructed on a parcel of land and the second unit is exempt from development charges where:

1. First Unit is the new detached house, semi-detached house or row house itself;

2. Second Unit that is eligible for the development charge exemption is a second residential unit in the First Unit (but not the First Unit itself), if all other buildings and structures ancillary on the parcel of land will contain no more than one unit; and

3. Third Unit is a single unit in an ancillary building or structure (if existing).

CONCLUSION

37Having considered the submissions of the Parties, for the reasons set out above, the Tribunal finds that the exemption from development charges in s. 2(3.3)1 does not apply to a second standalone residential building itself on a parcel of land, rather it applies to a second residential unit that is within a new building. As a result, the Tribunal thereby finds that the Future Dwelling is not exempt from the payment of DCs pursuant to s. 2(3.3)1 of the DCA.

ORDER

38THE TRIBUNAL ORDERS THAT the Motion for Directions by Sara Gardiner is dismissed.

“A. Mason”

A. MASON

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.