Court File and Parties

COURT FILE NO.: CV-21-661967 DATE: 2023/03/09

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: JAMES DELL, SOPHIE DELL, PATRICIA ANN DELL, ERIC JAMES DELL, CHARLENE QUEVILLON, RON QUEVILLON, MARY La VALLE, DAN La VALLE, RICHARD ZIRGER, JUDI ZIRGER, ROBERT ZIRGER, SHARON ZIRGER, GEORGE LEPP, CINDI LEPP, ERICA LEPP, MARK LEPP, 1174724 ONTARIO INC. O/A LEPP FARMS, BRUCE MOORE, SANDRA MOORE, KRISTINA MOORE, JAMIE WERSTROH and JOHN and JANE DOE Applicants

• and –

THE CORPORATION OF THE TOWN OF NIAGARA ON THE LAKE, HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO AS REPRESENTED BY THE MINISTER OF THE ENVIRONMENT, CONSERVATION and PARKS, HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO AS REPRESENTED BY THE MINISTER OF AGRICULTURE, FOOD AND RURAL AFFAIRS, THE ATTORNEY GENERAL OF ONTARIO and MERIDIAN CREDIT UNION Respondents

Counsel: Paul Marshall, Debra M. McAllister, and Cassandra Kirewskie for the Applicants Bobby Sacheva and Gina Rhodes for the Respondent 2507626 Ontario Inc. Ayesha Laldin and Brandon Fragomeni for the Respondent His Majesty the King in right of Ontario as represented by the Minister of Agriculture, Food and Rural Affairs and The Attorney General of Ontario. Terrence H. Hill for the Respondent The Corporation of the Town of Niagara on the Lake

HEARD: March 9, 2023

PERELL, J.

Endorsement

[1] An anaerobic digester is a waste disposal technology that processes organic material (known as feedstock) and converts it into: (a) digestate, which is used as a soil supplement or fertilizer; and (b) “biogas,” which, in turn, is a fuel to produce electrical energy. The organic material includes food scraps, fats, oils, greases, industrial organic residues such as grape pomace from the production of wine, sewage sludge, and animal manure. Anaerobic digesters reduce the adverse environmental impacts of farming operations by: (a) reducing methane gas emissions from livestock operations; (b) turning feedstock into energy and fertilizer; and (c) ameliorating other nuisances. However, if not properly utilized, an anaerobic digester on a property can be a nuisance to neighbouring properties.

[2] 2507626 Ontario Inc., (“4 Mile Creek Farms”), which has been served and which has appeared on this motion as an affected party, is not a named respondent to this application. It operates a farm under the business name Niagara 4 Mile Creek Farms. It is the owner of a 6.7 hectare property known as 2003-2001 Four Mile Creek, Niagara-on-the-Lake. The property was formerly owned by Vandermeer Greenhouses Ltd., which operated a cut flower greenhouse. On the property is an anaerobic digester that was installed in 2008 but that has not operated at least since 2018, when, pursuant to the Farming and Food Production Protection Act, 1998, it was ordered decommissioned by Order of the Normal Farm Practices Protection Board (“Farm Board”).

[3] The Applicants, James Dell, Sophie Dell, Patricia Ann Dell, Eric James Dell, Charlene Quevillon, Ron Quevillon, Mary La Valle, Dan La Valle, Richard Zirger, Judi Zirger, Robert Zirger, Sharon Zirger, George Lepp, Cindi Lepp, Erica Lepp, Mark Lepp, 1174724 Ontario Inc., Bruce Moore, Sandra Moore, Kristina Moore, and Jamie Werstroh, are fruit farmers, elderly retirees, and individuals who have lived in the Town for decades. Their farms and homes are in close proximity to the property now owned by 4 Mile Creek Farms.

[4] On May 7, 2021, the Applicants commenced a proceeding by application. Under the Rules of Civil Procedure, a proceeding may be brought by application for certain categories of cases depending upon the relief claimed and there is also general jurisdiction to deal with matters where the facts are not likely to be controverted. This jurisdiction is set out in rule 14.05(3), which states:

14.05(3) A proceeding may be brought by application where these rules authorize the commencement of a proceeding by application or where the relief claimed is,

(a) the opinion, advice or direction of the court on a question affecting the rights of a person in respect of the administration of the estate of a deceased person or the execution of a trust;

(b) an order directing executors, administrators or trustees to do or abstain from doing any particular act in respect of an estate or trust for which they are responsible;

(c) the removal or replacement of one or more executors, administrators or trustees, or the fixing of their compensation;

(d) the determination of rights that depend on the interpretation of a deed, will, contract or other instrument, or on the interpretation of a statute, order in council, regulation or municipal by-law or resolution;

(e) the declaration of an interest in or charge on land, including the nature and extent of the interest or charge or the boundaries of the land, or the settling of the priority of interests or charges;

(f) the approval of an arrangement or compromise or the approval of a purchase, sale, mortgage, lease or variation of trust;

(g) an injunction, mandatory order or declaration or the appointment of a receiver or other consequential relief when ancillary to relief claimed in a proceeding properly commenced by a notice of application;

(g.1) for a remedy under the Canadian Charter of Rights and Freedoms; or

(h) in respect of any matter where it is unlikely that there will be any material facts in dispute requiring a trial.

[5] By way of application, purportedly pursuant to rule 14.05(3)(d) and (h), the Applicants seek to amend their application to add 4 Mile Creek Farms as a Respondent.

[6] In their application, the Applicants seek the following relief:

1. The Applicants seek a declaration pursuant to s. 97 of the Courts of Justice Act, R.S.O. 1990, Chapter C. 43, that: (a) Ministry of Environment Certificate of Approval number 9512-7QNNZJ is required to be registered on the title of the property municipally known as 2021 Four Mile Creek Road, Niagara on the Lake, Ontario, Parcel Registers, PIN nos.: 46390-0007, 46390-0008, 46390-0011, 46390-0074; (b) the Normal Farm Practices and Protection Board’s (“the Board”) decision of November 8, 2018 is a judgement in rem and as such is binding on the land municipally known as 2021 Four Mile Creek Road, Niagara on the Lake (“the waste disposal site”); (c) the anaerobic digester system (“the digester”) on the Property is not a normal farm practice within the meaning of the Farming and Food Production Protection Act, 1998, S.O. 1998, c.1; (d) the digester system must be decommissioned in accordance with the Board’s decision, the Site Plan Agreement dated June 2, 2008 and the Certificate of Approval dated October 30, 2009; (e) the present owner/operator of the Property is required to comply with the Board’s Closure Order, the Site Plan Agreement and the Certificate of Approval dated October 30, 2009; and Niagara on the Lake By-law 4224-08.

2. The Applicants claim against the Respondents the Corporation of The Town of Niagara on The Lake, His Majesty The King In Right Of Ontario as Represented by The Minister of the Environment, Conservation and Parks, His Majesty The King in Right of Ontario as Represented by the Minister of Agriculture, Food And Rural Affairs, the Attorney General of Ontario: (a) general damages in the amount of $50,000,000.00; (b) special damages in an amount to be determined at, or before, the trial of this action; (c) aggravated and punitive damages in the amount of $20,000,000.00; (d) pre-judgment and post-judgment interest pursuant to the Courts of Justice Act, R.S.O. 1990, Chapter C. 43; (e) their costs of this action, including Harmonized Sales Tax; and, (f) such further and other relief as to this Honourable Court seems just.

3. The Applicants claim against the Respondent 2507626 Ontario Inc.: (a) a mandatory Order requiring it to shut down, decommission and remove the anaerobic digester in accordance with Niagara on the Lake By-law 4224-08, the Normal Farm Practices Protection Board Order of November 8, 2018 as registered as an Order of this Court;

[7] In their application, the Applicants now bring a motion for:

a. an Order adding 2507626 Ontario Inc. as a party Respondent and amending the Notice of Application; b. a Mandatory Order requiring 2507626 Ontario Inc. to comply with Niagara on the Lake By-law 4224-08 by immediately decommissioning and removing the anaerobic digester on its property; and c. in the alternative, a prohibitive injunction to restrain 2507626 Ontario from continuing any work on the site to restart the digester system until the application is decided.

[8] Procedurally, the Application and the motion now before the court have proceeded in the following manner:

a. On May 7, 2021, the Applicants commenced a proceeding by application against: (a) the Town of Niagara on the Lake (“the Town’); (b) the Attorney General of Ontario and His Majesty the King in Right of Ontario as represented by the Minister of the Environment, Conservation, and Parks and the Minister of Agriculture, Food and Rural Affairs (collectively “Ontario”); and (c) Meridian Credit Union. b. 4 Mile Creek Farms, whose rights are manifestly affected by the application was possibly inexplicably or possibly inexcusably not made a party respondent to the original application. c. The Town and Ontario brought motions to strike the original application, among other things, for failure to plead a reasonable cause of action and as an abuse of process and on September 23, 2022, over a year after the commencement of the application, the Town and Ontario moved to consolidate the application with the receivership proceedings that had been brought against Vandermeer Greenhouses and that were proceeding on Commercial Court list. d. Justice McEwen, team leader for the Commercial Court, refused the request and made the following endorsement:

The Province brings a motion seeking to transfer the action to the Commercial Court List. Its primary submission is that it would be appropriate to do so as the Receivership action is correctly on the Commercial List, the two actions are related and it would be sensible to have both matters case managed. The Province also submits that if it is successful on its motion to strike this action would come to an end. If unsuccessful it could be transferred to the civil list.

The Applicants oppose primarily submitting that the matter is not a commercial matter, but rather a matter of public law.

As I advised the parties at the hearing, I am denying the transfer request for the following reasons:

1. the matter is not “commercial” in nature except for its link to the receivership;
2. the receivership is about to conclude once the Div. Ct. rules on the costs issue;
3. the matter otherwise has no connection to the Toronto, and the Commercial List is very busy.

Last, the attached Order shall go on consent of the parties, except for the Town of Niagara which does not oppose.

e. The Order referred to in the last paragraph of Justice McEwen’s endorsement was an order dismissing the application as against Meridian Credit Union Limited. f. Sometime in November or December 2022, the Applicants became aware the 4 Mile Creek Farms might be planning to reactivate the aerobic digester and in these circumstances, the Applicants sought interlocutory relief. There was an attendance in Civil Practice Court on December 13, 2022, and Justice Koehnen set a timetable for a hearing of the Plaintiffs’ motion for March 9, 2023. Justice Koehen made the following endorsement:

The moving party seeks an urgent 1 day hearing to enjoin the re-start of a waste disposal facility, and in particular a digester associated with that facility.

The respondent expects the facility to be operational sometime in the spring of 2023. Given that motion dates are now 1 year out, there is some urgency to this motion.

The respondent’s representative, Mr. Verrelli, expects to invest another $50,000 into the facility between today and the start up date. That is a relatively small amount. As a result, any additional investment between now and the hearing date will not be a source of prejudice on which the respondent can rely to resist the injunction.

The respondent was only served with notice of today’s attendance late on Friday (today is Tuesday) and has understandably not been able to retain counsel. I have indicated that he should do so immediately and aim to retain counsel by the end of this week or early next week. Any counsel he retains will have to work within the timetable below.

I have also encouraged the parties to meet to have a practical discussion about what precisely the moving parties object to and why to see if their concerns can be addressed in a more practical manner than through the legal system (i.e. modification of the proposed operation).

At the request of the moving party, if it delivers its factum on February 24, 2023, the responding factums will be due March 3 and moving parties’ reply factum will be due on March 7, 2023.

The schedule set out on the next page is ordered.

• MOVING PARTY’S MOTION RECORD, APPLICATION RECORD, OR APPEAL BOOK TO BE DELIVERED BY: December 23, 2022.
• RESPONDING PARTY RECORD TO BE DELIVERED BY: January 27, 2023.
• REPLY RECORD, IF ANY, TO BE DELIVERED BY: February 7, 2023.
• CROSS-EXAMINATIONS: During the week of February 13, 2023
• UNDERTAKINGS TO BE ANSWERED BY: February 20, 2023
• MOTION FOR REFUSALS BY:
• CASE CONFERENCE TO BE CONDUCTED BY:
• MOVING PARTY OR APPLICANT’S FACTUM TO BE DELIVERED BY: February 27, 2023
• RESPONDING PARTY FACTUM TO BE DELIVERED BY: March 6, 2023
• Reply factum if any, March 8, 2023 by noon.
• APPROVED HEARING DATE: March 9, 2023 full day hearing

[9] The Applicants supported their motion with an evidentiary record of 325 pages comprised of: (a) the affidavits dated December 20, 2022 and March 2, 2023 of George Lepp; (b) the affidavits dated December 23, 2022 and March 2, 2023 of Charlene Quevillon; (c) the affidavits dated December 23, 2022, and March 2, 2023 of Ron Quevillon; and (d) the affidavits dated December 22, 2022 and March 2, 2023 of Richard Zirger.

[10] Ontario resisted the motion. It relies on the affidavit dated January 26, 2023 (18 pages) of Mohsen Keyvani, who is Manager, Waste Approvals with the Ministry of Environment, Conservation, and Parks in the Environmental Permissions Branch. He is also a Director appointed for the purposes of Part II.1 of the Environmental Protection Act.

[11] 4 Mile Creek Farms resisted the motion, and it relied on the affidavit (66 pages) dated January 27, 2023 of Tony Verrelli, who is a director of 4 Mile Creek Farms.

[12] The Town did not file any materials for the motion. There were no cross-examinations.

[13] Ontario and 4 Mile Creek Farms brought preliminary motions to strike the affidavit evidence of Ron Quevillon on numerous grounds.

[14] Rule 38.10 (1) describes the court’s jurisdiction in disposing of an Application; it states:

Disposition of Application

38.10 (1) On the hearing of an application the presiding judge may,

(a) grant the relief sought or dismiss or adjourn the application, in whole or in part and with or without terms; or

(b) order that the whole application or any issue proceed to trial and give such directions as are just.

(2) Where a trial of the whole application is directed, the proceeding shall thereafter be treated as an action, subject to the directions in the order directing the trial.

(3) Where a trial of an issue in the application is directed, the order directing the trial may provide that the proceeding be treated as an action in respect of the issue to be tried, subject to any directions in the order, and shall provide that the application be adjourned to be disposed of by the trial judge.

[15] The Applicants’ application is egregiously outside the court’s jurisdiction under rule 14.03 and if it were within the court’s jurisdiction, the Application is egregiously inappropriate to proceed by application.

[16] The Applicant’s application is essentially a nuisance and negligence action claiming $70 million. Whether these causes of action even exist is in dispute and the Town’s and Ontario’s motions to strike remain pending and unscheduled. And 4 Mile Creek Farms might well wish to bring a similar motion to strike if it were added as a respondent to the application.

[17] It may be observed that under rule 14.05(3)(h), an application may be brought “in respect of any matter where it is unlikely that there will be any material facts in dispute requiring a trial”. The wording of paragraph (h) requires the court to make an assessment of the likelihood of a dispute about material facts that require a trial. Durham Citizens Lobby for Environmental Awareness and Responsibility Inc. v. Durham (Regional Municipality), 2011 ONSC 7143 at paras. 40–42. The Applicants’ application is, and pardon the double negative, in respect of a matter where it is not unlikely that there will be any material facts in dispute requiring a trial. There are already plethora of facts in dispute most of which may require a trial to determine.

[18] The injunction relief that the Applicants seek on this motion is not available by the application.

[19] Although interlocutory and permanent injunctions are typically claimed as a remedy in a proceeding by action, these remedies may also be claimed in an application - if the injunction is ancillary to relief claimed in a proceeding properly commenced by a notice of application, including the jurisdiction under the subrule where there are no material facts in dispute, and under subrules (d) and (g) for the determination of rights following the interpretation of a contract and relief ancillary to those rights. Berkley Insurance Co. v. Rob Piroli Construction Ltd., 2016 ONCA 885; Eurodesign Upholstering Ltd. v. Macantonio, [2004] O.J. No. 4589 (S.C.J.), aff’d [2005] O.J. No. 91 (C.A.). The immediate case is not one in which the proceeding has been properly commenced by notice of application and according the injunctive relief requested is not available.

[20] Where there are material facts in dispute that require a trial, the judge may order that the application proceed to trial. Collins v. Canada (Attorney General), 76 O.R. (3d) 228 (S.C.J.). The applications judge may decide that where there is a dispute with respect to facts material to the issues to be resolved, an application is not appropriate and a trial should be ordered. 2503257 Ontario Ltd. v. 2505304 Ontario Inc. (Good Guys Gas Bar), 2021 ONSC 6101 (Div. Ct.); Keewatin v. Ontario (Ministry of Natural Resources), 66 O.R. (3d) 370 at para. 46 (Div. Ct.); Moyle v. Palmerston Police Services Board, 25 O.R. (3d) 127 at 131 (Div. Ct.). Burlington (City) v. Clairton (Village), 24 O.R. (2d) 586 at 589 (C.A.). An order directing a trial is discretionary and is typically granted where there is conflicting evidence and complex and disputed questions of fact or credibility where oral evidence is required. Van Decker v. Van Decker, [2006] O.J. No. 2321 at para. 11 (S.C.J.); Renegade Capital v. Hees, 73 O.R. (2d) 311 (H.C.J.); Energy Probe v. Canada (Attorney General), 68 O.R. (2d) 449 (C.A.).

[21] In determining whether to convert an application into a trial of an issue, the court will consider such factors as: (a) whether there are material facts in dispute; (b) the presence of complex issues; (c) whether there is a need for the exchange of pleadings and discovery; and (d) the importance and the nature of the relief sought by application. Avenue Road Trust (Trustees of) v. Pantrust International, S.A. (sub nom. Seabrook v. Pantrust), 2018 ONSC 5471; Fountain Asset Corp. v. First Global Data Ltd., 2017 ONSC 4780 (S.C.J.); Collins Barrow Toronto LLP v. Selectcore USA, LLC, 2016 ONSC 3826; Przysuski v. City Optical Holdings Inc., 2013 ONSC 5709; McKay Estate v. Love, 6 O.R. (3d) 511 at para. 6 (S.C.J.), aff’d (1991), 6 O.R. (3d) 519 (C.A.); Metropolitan Toronto Condominium Corp. No. 747 v. Korolekh, 2010 ONSC 4448, [2010] O.J. No. 3491 at paras. 54–55 (S.C.J.). The court should consider whether the affidavits and the transcript of the cross-examination is sufficient to decide any credibility issues or whether a trial is required. Metropolitan Toronto Condominium Corp. No. 747 v. Korolekh, 2010 ONSC 4448, [2010] O.J. No. 3491 at paras. 57–61 (S.C.J.); Rare Charitable Research Reserve v. Chaplin, [2006] O.J. No. 5434 at para. 15 (S.C.J.); Stronell v. Success Through Assisted Reproductive Technologies Inc., [2005] O.J. No. 115 at para. 73 (S.C.J.); Poersch v. Aetna, [2000] O.J. No. 270 at para. 86 (S.C.J.). The court should consider whether if the proceeding had already been commenced as an action and the moving party had brought a motion for a summary judgment would the court be satisfied that there is no genuine issue requiring a trial in which case a trial would not necessary. A.M. Machining Inc. v. Silverstone Marble & Granite Inc., 2010 ONSC 71 at paras. 4–14.

[22] In the immediate application: there are material facts in dispute; there are numerous complex issues that may require a trial; there is a need for proper pleadings; assuming the pleadings survive a motion to strike there will need to an exchange of pleadings and discovery; the matter are of considerable importance; and the nature of the relief sought is available by action and not by application. And, the case appears likely to need case management, at least for its initial phase.

[23] In these circumstances, I shall remain seized of this matter until further court order, and I make the following Order:

a. The Application shall be converted into an action. b. The Applicants, as plaintiffs shall have twenty days to deliver a Statement of Claim as against the Town, Ontario, and 4 Mile Creek Farms. c. The joinder of 4 Mile Creek Farms shall be without prejudice to 4 Mile Creek Farms right to have the joinder struck on any grounds as it may be advised. d. After the delivery of the Statement of Claim: i. The Plaintiffs shall have twenty days to bring such motion as they may be advised for injunctive or interlocutory relief; and ii. The Defendants respectively shall have twenty days to deliver a motion to strike the Statement of Claim for failing to show a reasonable cause of action or as an abuse of process or such other grounds as they respectively may be advised. iii. There shall be a case management conference on May 9, 2023 to complete the timetable for the parties’ motions which I schedule for September 11- 12, 2023 (virtual hearing). e. Costs to date to be costs in the Plaintiff’s motions for interlocutory relief or in the Defendants’ motion to strike the joinder or the Statement of Claim.

Perell, J. Released: March 9, 2023