Court of Appeal for Ontario

Date: May 8, 2017

Docket: C62807

Judges: Weiler, Pardu and Roberts JJ.A.

Between

Sutherland Lofts Inc. Applicant (Respondent in Appeal)

and

Chris Peck, Chief Building Official for the Corporation of the City of St. Thomas, and The Corporation of the City of St. Thomas Respondents (Appellants)

Counsel

Tom Halinski and David Neligan, for the appellants

Valerie M'Garry, for the respondent

Heard: April 12, 2017

On appeal from: The order of Justice K. Gorman of the Superior Court of Justice, dated September 23, 2016, with reasons reported at 2016 ONSC 6015.

By the Court

[1] Introduction

[1] The Corporation of the City of St. Thomas ("the City") and Chris Peck, the City's Chief Building Official ("CBO"), appeal the application judge's order declaring the Order to Remedy Unsafe Building, issued on December 3, 2015 ("the Order to Remedy"), by the CBO, null, void and inoperative.

[2] The respondent brings a cross-appeal to obtain an interim injunction preventing the appellants from demolishing its building located at 606-610 Talbot Street in St. Thomas, which was the subject of the Order to Remedy under appeal ("the Building"), and for a declaratory order that the Building is not "unsafe" as defined in the Building Code Act ("the Act"). The application judge declined to deal with these claimed remedies.

[3] For the reasons that follow, we allow the appeal, dismiss the cross-appeal, and remit to another application judge the questions of whether the Building is unsafe and whether an interim injunction should issue.

A. Preliminary Issue

[4] The parties were asked to address whether the appeal and cross-appeal were moot.

[5] The City issued a second Order to Remedy Unsafe Building, dated October 26, 2016, which the respondent has appealed to the Superior Court of Justice. As with the first Order to Remedy, the respondent submits that the second order is null, void and ineffective because it lacks specificity. That appeal is pending.

[6] The appellant takes the position that there is still a live controversy between the parties as to the specificity of an Order to Remedy Unsafe Building under the Act, which would benefit from this court's guidance. The respondent maintains that the present appeal and cross-appeal are moot because they are superseded by the October 26, 2016 order.

[7] We are of the view that the present appeal and cross-appeal are not moot. The issues of whether the Order to Remedy lacks specificity, the Building is unsafe, and the availability of an interim injunction to prevent demolition, do not raise a hypothetical or abstract question but are still live issues between the parties; this court's decision will therefore have a practical effect on the parties: Borowski v. Canada (Attorney General), [1989] 1 S.C.R. 342, at p. 353; Mental Health Centre Penetanguishene v. Ontario, 2010 ONCA 197, 260 O.A.C. 125, at para. 35.

B. Factual Background

[8] We shall set out a brief summary of the relevant factual background to put the appeal and cross-appeal into their proper context.

[9] The Building is over 100 years old. It was purchased by the respondent in 2003 with the plan of renovating it into a combination of commercial and residential apartments. This plan has never progressed and the Building has sat vacant from at least the date it was purchased by the respondent. Since that time, the condition of the Building has deteriorated.

[10] The lengthy history of the parties' dispute in relation to the Building dates back to at least 2008 when the CBO first issued an Order to Remedy on March 27, 2008, which, among other things, required the respondent to provide an engineer's structural report and undertake certain remedial repairs.

[11] The respondent did not comply with the Order to Remedy or the subsequent orders issued by the CBO. Instead, the respondent instigated injunction and other proceedings to stop the demolition of its Building.

[12] The respondent was initially unsuccessful and the City was permitted by the July 15, 2008 order of Little J. to proceed with the demolition of the Building. Demolition commenced on July 21, 2008.

[13] However, two days later, on July 23, 2008, the respondent obtained a stay of the demolition order pending its appeal of Little J.'s order. By then, the City had demolished part of the roof and removed some of the structural components of the Building.

[14] The respondent and its principal, David McGee, commenced an action against the appellants and others in July 2010 for wrongful demolition of the Building. On December 21, 2011, Leitch J. dismissed the respondent's action because the respondent was dissolved and was without legal capacity to commence the action. The motion judge struck out Mr. McGee's pleadings with leave to amend.

[15] The respondent took no further remedial steps to stabilize and preserve the Building. The respondent made several unsuccessful attempts to sell the Building. Although the respondent applied for and was granted a building permit for shoring on January 12, 2015, no work was undertaken at that time.

[16] In June 2015, a significant section of the Building's second floor collapsed and on September 11, 2015, the roof partially collapsed. The City engaged an engineering firm to inspect the Building and provide a written report with respect to its structural condition. The CBO issued and served on the respondent an Order Prohibiting Occupancy dated September 15, 2015. In response to the engineering report, also dated September 15, 2015, the CBO issued and served on the respondent an Emergency Order the following day on September 16, 2015, to which the engineering report was attached.

[17] The respondent engaged an engineering firm to prepare and deliver an inspection report which included a plan for hoarding and shoring to alleviate the danger posed by the instability of the Building, as well as waterproofing to avoid further deterioration. The report was received on September 21, 2015. The respondent completed about 30% of the shoring, some of the hoarding, and none of the waterproofing, which were recommended by its own engineer.

[18] Having determined that the immediate danger of collapse had been alleviated by the respondent's temporary shoring and hoarding work, on November 5, 2015, the CBO lifted the Emergency Order and replaced it with an Order of the Property Standards Officer, which detailed additional work to be completed. On December 3, 2015, the CBO issued the Order to Remedy Unsafe Building, which is the subject of this appeal.

[19] The respondent did not comply with the orders or complete any additional remedial work. It did not appeal any of the orders but brought an application in March 2016 to have the Order to Remedy declared invalid, and to obtain interim injunctive relief, as well as a declaration that the Building was not unsafe. In the alternative, the respondent requested leave to file a late appeal of the November 5, 2015 Order of the Property Standards Officer and the December 3, 2015 Order to Remedy.

C. Application Judge's Decision

[20] The application judge determined that the Order to Remedy was null, void and inoperative for the following reasons:

i. It did not comply with the Act because it was only served on the owner. The application judge concluded that the Order to Remedy should have also been served on the respondent's property manager and local supervisory agent, as "such other persons affected" by the Order.

ii. It lacked the specificity required under the Act.

[21] The application judge concluded that, given her ruling with respect to the invalidity of the Order to Remedy, it was not necessary for her to deal with the issue of injunctive relief. Although not stated, presumably also because of her ruling, the application judge did not determine the factual issue of the Building's structural integrity.

D. Analysis

[22] We agree that the application judge made two errors.

(1) Service of the Order to Remedy

[23] First, the application judge erroneously declared that the Order to Remedy was null, void and inoperative based on allegedly defective service on the respondent.

[24] In our view, the appellants' service of the Order to Remedy by registered mail on the respondent as owner of the Building, at the respondent's last known address, complied with the provisions of ss. 15.9(5) and 27(1) of the Act, which provide as follows:

s. 15.9(5) The order shall be served on the owner and each person apparently in possession of the building and such other persons affected thereby as the chief building official determines and a copy of the order may be posted on the site of the building.

s. 27(1) A notice or order required by this Act to be served may be served personally or by registered mail sent to the last known address of the person to whom notice is to be given or to that person's agent for service.

[25] It was within the CBO's discretion as to whether the respondent's property manager and local supervisory agent should be served with the Order to Remedy. We agree with the appellants' submission that the property manager and local supervisory agent were not in possession of the Building, but were at best the respondent's agents for service. The Building was vacant and there was an order that prohibited occupation. Only the owner was in possession of the Building. As a result, the CBO was not required to serve any other person. There is no basis to suggest that the CBO acted unreasonably in the exercise of his discretion not to serve the respondent's property manager and local supervisory agent.

[26] In any event, delayed service does not invalidate the Order to Remedy. Section 27(2) of the Act deals with the possibility of, and the remedy for, delayed service, namely, that service is not effective until receipt:

If a notice or order is served by registered mail, the service shall be deemed to have been made on the fifth day after the day of mailing unless the person to whom the notice or order is given or that person's agent for service establishes that, acting in good faith, through absence, accident, illness or other unintentional cause the notice was not received until a later date.

[27] As a result, delayed service may only affect the timelines under the Order to Remedy, giving rise to an extension of time for compliance with the Order to Remedy under s. 27(2), or for an appeal pursuant to s. 25(2) of the Act.

[28] The purpose of service was achieved in this case: all interested and affected parties had notice of the Order to Remedy and were present before the court. As a result, we confirm that service of the Order to Remedy was compliant with the Act and did not invalidate the Order to Remedy.

(2) Specificity of the Order to Remedy

[29] We turn next to the application judge's determination that the Order to Remedy lacked specificity contrary to the Act. The application judge did not provide any reasons or analysis for this conclusion. She also mistakenly referred to s. 15.2(2) of the Act, which prescribes the contents of a Property Standards Order, rather than to s. 15.9(4), which prescribes the contents of an Order to Remedy Unsafe Building. Unfortunately, her lack of reasons and analysis does not permit us to conduct a meaningful appellate review. As a result, no deference is owed to her decision and this court must consider this question afresh.

[30] We start with the general principle that a lack of particulars is not fatal to the validity of an Order to Remedy Unsafe Building under s. 15.9(4) of the Act.

[31] First, s. 15.9(4) of the Act allows for detailed particulars of the remedial steps to be taken to be provided following further investigation. For example, in Ottawa (City) v. Lauzon, 2013 ONSC 2619, [2013] O.J. No. 2072, at para. 22, the court confirmed that "[s]ection 15.9(4) gives the City the authority to order the remedial steps to be taken which would include the authority to request further engineering reports be provided to determine what remedial steps are to be taken".

[32] Further, s. 25(4) of the Act allows a judge to order that additional particulars be provided because it empowers a judge to take any action that the CBO may take:

On an appeal, a judge may affirm or rescind the order or decision and take any other action that the judge considers the chief building official, registered code agency or inspector ought to take in accordance with this Act and the regulations and, for those purposes, the judge may substitute his or her opinion for that of the official, agency or inspector.

[33] Turning next to the prescribed specificity of the Order to Remedy, s. 15.9(4) of the Act stipulates that an Order to Remedy Unsafe Building should contain the following:

An inspector who finds that a building is unsafe may make an order setting out the reasons why the building is unsafe and the remedial steps necessary to render the building safe and may require the order to be carried out within the time specified in the order.

[34] In the present case, we are of the view that the Order to Remedy complies with s. 15.9(4) of the Act in that it contains sufficient particularity to enable the respondent to know the case it had to meet and the deficiencies that had to be remedied. In particular, the Order to Remedy specifies the areas and items in the Building that comprise the alleged serious, unsafe conditions requiring remediation, including the collapsed and rotten sections of floors and split structural beams that were also noted by the respondent's own engineer.

[35] Moreover, when the Order to Remedy is viewed in the context of the long history between the parties, the lengthy correspondence and the detailed engineering reports that the parties exchanged, there can be no doubt that the respondent knew the case it had to meet and the repairs that were necessary to stabilize the Building. Moreover, the respondent applied for a building permit to carry out repairs and its own engineer recommended certain remedial measures that corresponded with those required by the Order to Remedy. The respondent completed some but not all of the necessary repairs. The respondent did not complete all of the shoring and hoarding work required nor any of the waterproofing recommended by its own engineer. This was not due to the respondent's lack of understanding of what was required, but because of an admitted lack of funds to complete the repairs.

[36] We see no basis to invalidate the Order to Remedy.

[37] Before leaving the issue of specificity, we make the following general recommendation for the future. Given that an Order to Remedy Unsafe Building under the Act is necessarily fact-specific to the particular building or property for which the order is issued, it is not possible to make general, practical suggestions about the level of specificity required for such an order. However, as appellants' counsel conceded, if the CBO already has an engineering report, it would be helpful to attach it to the order requiring remediation, if it has not already been delivered to the person receiving the order (as it was in the present case).

[38] By this recommendation, we are not suggesting that the CBO must obtain an engineering report before issuing an Order to Remedy Unsafe Building under the Act. Nor is it fatal to the validity of such an order if the CBO does not have or does not attach an engineering report. Certainly, for the protection of the public, the CBO must have the flexibility to issue such orders to deal with all kinds of situations without first incurring the delay and expense of an engineering report. Moreover, it is also within the CBO's discretion to require the person receiving the order to obtain an engineering report: Ottawa, at para. 22.

E. Respondent's Cross-Appeal

[39] With respect to the respondent's request for injunctive and declarative relief, we are not in a position to determine these issues on this record. In particular, we lack a current evidentiary record describing the present state of the Building. Further, with respect to the injunctive relief requested, we have no evidence that the respondent is capable of providing any undertaking with respect to damages.

F. Disposition

[40] Accordingly, the appeal is allowed. The cross-appeal is dismissed. The issues of whether an interim injunction should be granted, and whether the Building is unsafe, are remitted for hearing before another application judge.

[41] If the parties cannot agree on the issue of costs on the appeal, the appellants shall deliver a bill of costs, together with any brief written submissions of no more than two pages, within seven days of the release of this decision. The respondents shall deliver their responding written submissions of no more than two pages within fourteen days of the release of this decision, subject to a request for further time to prepare the submissions. The appellants shall deliver a brief reply within seventeen days of the release of this decision.

Released: May 8, 2017

"K.M Weiler J.A."

"G. Pardu J.A."

"L. B. Roberts J.A."

Footnote

[1] Although not raised as an issue on this appeal, we note that the application judge mistakenly referred to s. 15.2(3) of the Act instead of s. 15.9(5) of the Act.