TDL Group Ltd. et al. v. Regional Municipality of Niagara [Indexed as: TDL Group Ltd. v. Niagara (Regional Municipality)]

55 O.R. (3d) 1

[2001] O.J. No. 3017

Docket No. C35798

Court of Appeal for Ontario

Catzman, Feldman and Sharpe JJ.A.

July 23, 2001

Highways--Access--Alteration of road access--Municipality passing by-law to widen road and to construct median--Median preventing westbound motorists from having direct access to properties on the south side of road--Landowner with property on south side challenging by-law and claiming remedy pursuant to s. 298(1) of Municipal Act--Landowner seeking that another means of access be provided--Section 298(1) applies only where effect of by-law is to deprive landowner of his or her only means of access to highway--Municipal Act, R.S.O. 1990, c. M.45, s. 298.

The TDL Group Ltd. and Chri-Gyn Ltd. ("the respondents") operated a Tim Hortons franchise on the south side of Fourth Avenue in the city of St. Catharines. The regional municipality passed a by-law to widen Fourth Avenue, which road widening included the construction of a continuous centre median. This construction would prevent motorists heading west along Fourth Avenue from making a direct left turn into the respondents' shop and would prevent patrons leaving the premises from turning left onto Fourth Avenue. The respondents challenged the right of the municipality to enact the by-law without making a cut in the median to allow unimpeded access for westbound traffic. The respondents relied on s. 298(1) of the Municipal Act which provides, amongst other things, that a by-law shall not be passed for altering any highway or part of a highway if the by-law deprives any person of the means of ingress and egress to or from the person's land unless, in addition to making compensation, another means of access is provided. The respondents applied for declaratory relief, which was granted. The regional municipality appealed.

Held, the appeal should be allowed with costs.

A consistent line of authority holds that s. 298(1) of the Municipal Act applies only where the effect of the by-law is to deprive the landowner of his or her only means of access to the highway. The statutory remedy does not apply where some means of access remain and the by-law merely limits the owner's access. The motions court judge erred in the interpretation of s. 298(1) and accordingly the appeal should be allowed.

APPEAL from a judgment granting declaratory relief.

Cases referred to Crédit foncier franco-canadien v. Swansea (Village), 1940 341 (ON CA), [1940] 1 D.L.R. 446, [1940] O.W.N. 53 (C.A.); McArthur v. Southwold (Township) (1878), 3 O.A.R. 295, revg (1878), 29 U.C.C.P. 216 (Ont.); Toronto Transportation Commission v. Swansea (Village), 1935 4 (SCC), [1935] S.C.R. 455, [1935] 3 D.L.R. 619; Trusts and Guarantee Co. Ltd. v. Municipal Corporation of the Township of Toronto, 1942 100 (ON SC), [1942] O.R. 68 Statutes referred to Expropriations Act, R.S.O. 1990, c. E.26 Municipal Act, R.S.O. 1990, c. M.45, s. 298 Municipal Act, R.S.O. 1937, c. 266, s. 496(1)

Roger T. Beaman and Darcy Merkur, for appellant. Paul Bates and Kirk Stevens, for respondents.

The judgment of the court was delivered by

[1] SHARPE J.A.:-- This appeal concerns the nature of a property owner's right of access to a public road and the corresponding power of a municipality to limit such access to maintain orderly and safe traffic conditions.

Facts

[2] The respondents operate a Tim Hortons franchise on the south side of Fourth Avenue in St. Catharines. There is significant commercial development in the area, including a "Power Center" that will consist of a number of large retail operations on the property adjacent to that of the respondents. The appellant Municipality decided that it was necessary for operational and safety reasons to widen Fourth Avenue from a two-lane rural cross-section to a four, and in some locations five-lane urban cross-section. The plan includes a continuous centre median running along the widened segment of the road. The median would prevent motorists heading west along Fourth Avenue from making a left turn directly into the respondents' Tim Hortons shop. Instead, westbound patrons would have to take a circuitous route, partially on private lands, to access the shop. The centre median would also prevent patrons leaving the respondents' premises from turning left onto Fourth Avenue.

[3] The respondents challenged the right of the appellant to enact a by-law imposing the continuous centre median. The respondents rely on the Municipal Act, R.S.O. 1990, c. M.45, s. 298, which provides as follows:

298(1) A by-law shall not be passed for stopping up, altering or diverting any highway or part of a highway if the effect of the by-law will be to deprive any person of the means of ingress and egress to and from the person's land or place of residence over such highway or part of it unless such person consents to the passing of the by-law or unless in addition to making compensation to such person, as provided by this Act, another convenient road or way of access to the land or place of residence is provided.

(2) The by-law does not take effect until the sufficiency of such road or way of access has been agreed upon or until, if not agreed upon, its sufficiency has been determined by arbitration as hereinafter mentioned.

(3) If such person disputes the sufficiency of the road or way of access provided, the sufficiency of it shall be determined by arbitration under this Act and, if the amount of compensation is also not agreed upon, both matters shall be determined by one and the same arbitration.

(4) If the arbitrator determines that the road or way of access provided is insufficient, he or she may in the award determine what road or way of access should be provided and, in that case, unless such last-mentioned road or way of access is provided, the by-law is void and the corporation shall pay the costs of the arbitration and award.

[4] The respondents say that a continuous centre median preventing westbound motorists from turning directly into their shop would significantly affect their business. They insist that there be a cut in the median to allow unimpeded access for westbound traffic. They moved, inter alia, for a declaration that the by-law in question deprives them of access to part of Fourth Avenue and that they are entitled to arbitration pursuant to s. 298 for determination of another convenient means of access to that part of the roadway and of the compensation to which they are entitled. In a separate proceeding, the respondents gave notice of their claim for compensation for injurious affection pursuant to the Expropriations Act, R.S.O. 1990, c. E.26.

[5] In concluding that the respondents were entitled to the declaratory relief they sought, the motions court judge found as follows [at para. 21]:

The restriction of left turn movements created by the continuous median adjacent to the Tim Hortons effectively divests it of all westbound traffic flow and removes any means of access over the eastbound part of the highway. The use of the words "the means of ingress and egress to and from the person's land" and "over such highway or part of it" (emphasis added) in s. 298 of the Municipal Act qualifies the concept of "deprivation" and does not, in my view, require that a landowner be totally or wholly deprived of all access to and from the land. The purpose of s. 298 seems to be to provide a balance between the preservation of common law rights of access and the public interest in road improvements. I find that where there has been a substantial impairment of access beyond the de minimis range such as exists here, the element of "deprivation" in s. 298 has been satisfied.

Analysis

[6] In my respectful view, the motions court judge erred in her interpretation of s. 298(1). While the decided cases are not on all fours with the facts of the present case, there is a consistent line of authority that s. 298(1) only applies where the effect of the by-law is to deprive the landowner of his or her only means of access to the highway. The statutory remedy does not apply where some means of access remains and the by- law merely limits the landowner's access. Interruption of a preferred or alternate means of access may well give rise to a remedy for compensation for injurious affection. However, the property owner who is left with some means of access cannot insist upon the more substantial remedy offered by s. 298(1), requiring the municipality not only to pay compensation but also to provide an alternate means of access.

[7] In Crédit foncier franco-canadien v. Swansea (Village), 1940 341 (ON CA), [1940] 1 D.L.R. 446, [1940] O.W.N. 53 (C.A.), the municipality enacted a by-law which had the effect of depriving the property owner of access to his garage which led to the street. The owner retained access from another point on his property to another street. This court held that the owner had no right to insist that the municipality provide alternative access pursuant to what was then s. 496(1) of the Municipal Act [R.S.O. 1937, c. 266]. Writing for the court, Robertson C.J.O. stated at p. 450 D.L.R.:

It is only when the "effect of the by-law will be to deprive any person of the means of ingress and egress" that the subsection applies. It seems to me that it is plain when the statute speaks of the means of ingress and egress what is contemplated is a property having only one means of ingress and egress, and of that one means the land owner will be deprived by the by-law.

The statute plainly contemplates compensation being made under s. 347 of the Municipal Act to owners who are injuriously affected by closing a street, and so long as the owner is not wholly excluded from access to his land by a public highway there is no reason why the closing of any additional means of access he may have, cannot be the subject of compensation.

[8] This reasoning was followed in Trusts and Guarantee Co. Ltd. v. Municipal Corporation of the Township of Toronto, 1942 100 (ON SC), [1942] O.R. 68 where the property owner had two means of access to the same highway. The effect of the by-law was to close off one of those means of access. Chevrier J. followed the dictum just quoted from the Crédit foncier case. In an early Ontario case, McArthur v. Southwold (Township) (1878), 3 O.A.R. 295, the court arrived at a similar interpretation of an earlier version of s. 298(1). At that time, the statute required that the claimant be "excluded from ingress and egress to and from his lands or place of residence". The by-law at issue closed the road to which the owner had access but the owner retained access to another road. Patterson J.A. wrote at p. 305 that the owner had no claim under the statute "because there was already another mode of ingress and egress to and from the land in question".

[9] The respondents rely on the common law principle stated in Toronto Transportation Commission v. Swansea (Village), 1935 4 (SCC), [1935] S.C.R. 455 at p. 457, [1935] 3 D.L.R. 619, that a property owner is entitled to access to a highway "at any point at which his land actually touches [the] highway for any kind of traffic which is necessary for the reasonable enjoyment of his premises". I do not accept the proposition that the remedy conferred by s. 298(1) may be invoked in every case where a by- law infringes a property owner's common law right of access to the highway. In my view, there is a clear distinction to be drawn between an interference with a common law right of access, which will lead to a remedy for compensation for injurious affection, and a denial of access, which will trigger the remedy conferred by s. 298(1). The statutory remedy under s. 298(1) consists not only of compensation but also of a right to an alternative means of access and can be invoked only where the owner is deprived of access , not where access is merely limited.

[10] Nor do I accept the contention that in s. 298 the words "or part of it" qualify the concept of "deprivation" with the result that something less than total deprivation of all access will trigger the remedy conferred by the section. The reference to deprivation of access "over such highway or part of it" refers back to the earlier language relating to the by- law providing for "stopping up, altering or diverting any highway or part of a highway". In my view, the words "part of a highway" refer simply to the portion of the highway that is subject to the alteration or diversion. They do not imply a right to the statutory remedy where the owner's access is limited but not denied. If the words "part of a highway" were to be given the meaning contended for by the respondents, a property owner could insist upon access to every part of the highway that suits the property owner's convenience.

[11] In my view, accepting the respondents' contention would seriously and unduly impair the capacity of municipalities to make decisions necessary in the public interest for the efficient and safe operation of highways. To take the facts of the present case, it seems to me that if these respondents are entitled to insist upon a centre cut in the median to permit traffic to turn left into their premises, every other business establishment along the same road soliciting business from patrons travelling in both directions could make the same demand. If the respondents and all others similarly situated could insist upon a centre cut in the median to afford access to their premises, the municipality would, in effect, be powerless to create a centre median to control the flow of traffic.

[12] As I have already noted, the respondents are not without a remedy. They have filed for compensation for injurious affection. In my view, they are limited to that remedy and have no rights pursuant to s. 298(1).

[13] Accordingly, I would allow the appeal, set aside the order of the motions court judge and in its place make an order:

i. declaring that s. 298(1) of the Municipal Act is not applicable in the circumstances of this case;

ii. declaring that the defendant is entitled to complete the centre median in accordance with the terms of by-law 167-1999 along Fourth Avenue in the City of St. Catharines in and about the location of the plaintiffs' leased property;

iii. declaring that the plaintiffs' only remedy arising from the completion of the centre median along Fourth Avenue is a claim for compensation for injurious affection under the Expropriations Act; and

iv. dismissing this motion with costs payable to the defendant.

[14] The appellant is entitled to its costs of this appeal.

Appeal allowed with costs.