COURT OF APPEAL FOR ONTARIO
CITATION: Wilton v. Northern Bruce Peninsula (Municipality), 2020 ONCA 674
DATE: 20201026
DOCKET: C66314
Doherty, Paciocco and Coroza JJ.A.
BETWEEN
Shirley Wilton as an Estate Trustee of Anneliese Weiss
Appellant
and
Municipality of Northern Bruce Peninsula
Respondent
Shirley Wilton, acting in person
Nicholas Lovell, for the respondent
Heard: in writing
On appeal from the order of Justice Kofi N. Barnes of the Superior Court of Justice, dated November 2, 2018.
Paciocco J.A.:
OVERVIEW
[1] Shirley Wilton appeals a judgment denying her application to set aside a 2016 municipal tax sale of a property at 19 Duke Lane, Lion’s Head, Ontario (“19 Duke Lane”). That property was registered under the Registry Act, R.S.O. 1990, c. R.20, in the name of her deceased parents, Frank and Anneliese Weiss, who purchased the property in 1968. Anneliese Weiss survived Frank Weiss. She lived until March 2005.
[2] In the application now under appeal, Ms. Wilton contended that the municipal tax sale was null and void as the respondent, the Municipality of Northern Bruce Peninsula (“the Municipality”), had failed to give her notice of the tax sale, as required by law. The application judge dismissed the application, finding that the Municipality was not required by law to notify Ms. Wilton.
[3] Ms. Wilton appeals that decision, arguing that the application judge erred in finding that the Municipality was not required to notify her of the tax sale. She also argues, for the first time on appeal, that the Municipality acted in bad faith by not furnishing her with notice. She asks this court to award her damages in the sum of $167,437.68, which she claims to be the fair market value of the property less the costs of sale.
[4] Ms. Wilton brought the application, and now brings this appeal, as the “Estate Trustee of Anneliese Weiss”. Although she attests in her affidavit in support of the application to being “the executor/trustee of the estate of Anneliese Weiss”, Ms. Wilton has not filed documentation confirming her appointment as executor or trustee. I would nonetheless address her appeal on its merits. I would dismiss the appeal on the simple basis that the Municipality complied with its notice obligations and owed her no duty that it could have breached in bad faith.
MATERIAL FACTS
[5] Ms. Wilton did not have a registered interest in 19 Duke Lane when the tax sale was underway, or at any other time. She was never shown as an owner of the property on municipal tax assessment rolls. Nor did she file a notice of change of address with the Municipality, linking 19 Duke Lane to her personal address. Further, no documents relating to the estate of either Frank or Anneliese Weiss were lodged on title.
[6] Ms. Wilton’s claim that she was nonetheless entitled to notice is closely linked to evidence, presented during the application, that municipal employees were aware that: (1) in early 2009, Ms. Wilton arranged for the payment of the tax arrears on 19 Duke Lane that were outstanding at that time; (2) in related email correspondence with municipal employees, she referred to the “Weiss estate” and sought receipts in the name of the estate; (3) in September 2012, she arranged for the Municipality to send prepayment authorizations to her personal address. She and her husband gave prepayment authorization for taxes owing on property they owned, but one such authorization was completed for 19 Duke Lane, which she signed as “Trustee for Weiss Estate” and returned to the Municipality; (4) in October 2012, she arranged for the variation of the pre-authorized payment amounts in correspondence that included her contact information; and (5) further correspondence was exchanged between January 2013 and September 2015 relating to pre-authorized payments. This most recent correspondence, exchanged after cheques received by the Municipality were declined for insufficient funds and the Municipality gave notice of its refusal to process further pre-authorized payments, contained Ms. Wilton’s personal contact information.
[7] The Municipality decided to pursue a tax sale of 19 Duke Lane and retained the firm REALTAX Inc. to undertake the process. After the necessary searches were conducted and tax arrears were confirmed in the amount of $11,356.27, as of December 31, 2014, a Tax Arrears Certificate was registered on title on January 30, 2015. A copy of that certificate and a Notice of Registration of Tax Arrears Certificates were sent by registered mail to Frank and Anneliese Weiss at two addresses: the 19 Duke Lane address shown on the Municipal Assessment Roll, and the Kitchener, Ontario address shown in the registered title document that disclosed their interest in the 19 Duke Lane property. Duplicate notices were also sent to Frank and Anneliese Wiess at both addresses in their capacity as spouses of one another. A Statutory Declaration Regarding Sending of Notice was sworn. The registered letters were returned unopened.
[8] In November 2015, the property search was updated, and final notices were sent to Frank and Anneliese Weiss at the same addresses, once again, both in their personal capacity and as spouses of one another. A second Statutory Declaration Regarding Sending of Notice was sworn, notices of the pending tax sale were published in regional newspapers and in the Ontario Gazette, and tenders were opened on March 3, 2016. The property was transferred to the successful tenderer on March 24, 2016.
THE ISSUES
[9] The issues raised by Ms. Wilton can be fairly described as follows:
A. Did the Municipality fail to comply with the statutory notice obligations?
B. Did the Municipality breach its duty of good faith to Ms. Wilton?
ANALYSIS
A. Did the Municipality fail to comply with the statutory notice obligations?
[10] The required notice obligations relating to a tax sale are set out in the Municipal Act, 2001, S.O. 2001, c. 25. Section 374 provides, in relevant part, that within 60 days of the registration of a tax arrears certificate, the municipality is required to “send a notice of the registration of the certificate to the following persons”. The provision then lists persons to whom the notice must be sent. Two are relevant to the 19 Duke Lane tax sale:
The assessed owner of the land.
Where the Registry Act applies to the land, every person appearing by the abstract index and by the index of executions for the area in which the land is situate to have an interest in the land on the day the tax arrears certificate was registered….
[11] Additionally, s. 374(2) of the Municipal Act, 2001 requires that notice also be sent to the spouse of the person receiving notice.
[12] Where the cancellation price remains unpaid 280 days after the tax arrears certificate is registered, s. 379(1) requires the municipality to send a final notice to the same parties entitled to receive notice under s. 374.
[13] Section 381(1) of the Municipal Act, 2001 sets out how both notices are to be provided. It directs that any notice required “may be given by personal delivery or be sent by certified or registered mail”. It then describes where the notice may be sent to, by certified or registered mail, depending upon the party being given notice. Three possibilities are relevant:
(a) in the case of the assessed owner, to the address of the person as shown on the last returned assessment roll of the municipality;
(b) in the case of any person whose interest is registered against the land, to the address for service of the person furnished under the Land Registration Reform Act…
(d) in the case of a spouse of the person appearing by the records of the land registry office to be the owner of the land, addressed to the spouse of (name of person) at the usual or last known address of such spouse or, if unknown, at the address of the land.
[14] As indicated, the Municipality sent notices by registered mail to Frank and Anneliese Weiss at the address shown on the Municipality’s last assessment roll, and at the address shown in the registered documents disclosing their interest in the land. Moreover, duplicate notices were sent to Frank and Anneliese Weiss at both addresses, in their capacity as spouses of one another.
[15] Ms. Wilton argues that, despite this, the notice requirements under the Municipal Act, 2001 have not been satisfied based on s. 381(2) and s. 374(5) of the statute.
[16] She relies on s. 381(2) to argue that since the registered letters were returned unopened, proper notice was not provided. Section 381(2) provides:
A statutory declaration made under subsection 374(3) or made under clause 379(2)(a) is proof in the absence of evidence to the contrary that the notices required to be sent were sent to the persons named in the statutory declaration and received by them.
[17] It is Ms. Wilton’s position that the return of the registered mail is “evidence to the contrary”, thereby rebutting the deemed receipt provided for in s. 381(2). In my view, even if this is correct, it would be immaterial to whether proper notice has been given.
[18] In Elliott v. Toronto (City) (1999), 1999 CanLII 1073 (ON CA), 171 D.L.R. (4th) 64 (Ont. C.A.), leave to appeal refused, [1999] S.C.C.A. No. 244, Morden A.C.J.O. rejected a similar argument made under the now repealed Municipal Tax Sales Act, R.S.O. 1990, c. M-60, the precursor legislation to the tax sale provisions now found in the Municipal Act, 2001. There are minor differences in wording between relevant provisions of the Municipal Tax Sales Act and the Municipal Act, 2001 but those differences are not material. The operation of the relative provisions remains identical.
[19] To explain why the return of the registered letters has no bearing on the sufficiency of the notice provided, I will quote what Morden A.C.J.O. said in Elliott, at para. 28, but replace the Municipal Tax Sales Act sections with their counterparts in the Municipal Act, 2001:
Whatever the full meaning and effect of this provision may be, it does not state that it is a requirement of the Act that the s. [374(1)] and s. [379(1)] notices to be legally effective must be received. Receipt is not a necessary element of the concept of ‘send to’ (ss. [374(1) and 379(1)]) and would be inconsistent with s. [381(4)]. I can envisage that in some circumstances it might be useful to a municipality to submit that there was, in addition to the sending of the notice, receipt – and s. [381(2)] allows this submission to be made. [Citation omitted.]
[20] Put otherwise, since ss. 374(1) and 379(1) do not require receipt before a notice that has been sent is effective, s. 381(2) has nothing to do with whether proper notice has been provided. Instead, it was enacted so that if a municipality found value in arguing receipt, they could rely on the evidentiary shortcut that s. 381(2) provides. Section 381(4), a provision that would lose meaning were we to accept Ms. Wilton’s submission, strongly reinforces this outcome. It provides: “Nothing in this Part requires the treasurer to ensure that a notice that is properly sent under this Part is received by the person to whom it was sent.”
[21] I therefore reject the submission that the return of the registered letters had any bearing on whether notice had been properly sent.
[22] Nor does s. 374(5) of the Municipal Act, 2001 assist Ms. Wilton. It provides:
A person is not entitled to notice under this section if,
(a) after a reasonable search of the records mentioned in subsection 381(1), the treasurer is unable to find the person’s address and the treasurer is not otherwise aware of the address; or
(b) the person has expressly waived the right to notice, either before or after the notice should have been sent. [Emphasis added.]
[23] Ms. Wilton appears to argue, based on the words underlined above, that s. 374(5)(a) imposes a duty on the Municipality to undertake a reasonable search of the records mentioned in s. 381(1) and to give notice at the addresses identified. This is a misreading of s. 374(5)(a). As the heading of the section, “Limitation”, reflects, s. 374(5) is a limitation on the statutory duty to give notice of a tax sale. It does not impose an additional statutory notice obligation of general application. The plain meaning of s. 374(5) is that it operates where the address of a person entitled to notice is not disclosed by the records identified in s. 381(1). Where this is so, and the treasurer is not otherwise aware of the address, any otherwise operative right to receive notice pursuant to ss. 374(1) and 379(1) is lost. Section 374(5) does not apply in this case because the Municipality’s assessment roll and the registered documentation disclosing Frank and Anneliese Weiss’s interest in the land did supply addresses for Frank and Anneliese Weiss.
[24] I would therefore dismiss this ground of appeal. The Municipality satisfied their notice obligations relating to the tax sale of 19 Duke Lane.
B. Did the Municipality breach its duty of good faith to Ms. Wilton?
[25] Ms. Wilton argues that, given that it knew or should have known that she had assumed responsibility for paying the taxes on 19 Duke Lane, the Municipality had a good faith obligation to notify her before proceeding with a tax sale. Even if we chose to entertain this argument for the first time on appeal, it would have to be rejected.
[26] First, the Municipal Act, 2001 provides a comprehensive legislative scheme for the conduct of tax sales. According to the terms of the statute, the Municipality was not obliged to give Ms. Wilton notice of the tax sale. It would not be appropriate to rely on knowledge within a municipality of interested parties to fashion additional notice obligations on the municipality not provided for in this “carefully crafted legislative scheme”: Zeitel v. Ellscheid, 1994 CanLII 82 (SCC), [1994] 2 S.C.R. 142, at p. 152; Elliott, at paras. 50-51. The Municipality owed no duty to Ms. Wilton to give her notice. In the absence of such a duty, there is no basis for her claim that the Municipality acted in bad faith.
[27] Second, even if it were appropriate to recognize an additional, non-legislated notice obligation based on “bad faith” reasoning, this would not be an appropriate case in which to do so. Means were available to Ms. Wilton to ensure that she would have a legal right to receive notice. She could have lodged estate documents on title. She could have submitted a change of address redirecting tax information relating to the property to her personal address after her mother’s death. Yet, she did nothing. In this context, I find unpersuasive her attempt to cast the Municipality as having acted in “bad faith” for failing to make the link, or failing to act on the link, between her inconsistent tax payment efforts and the correspondence they generated, and the notice required in relation to the 2016 tax sale.
[28] I would reject this ground of appeal.
CONCLUSION
[29] I would dismiss the appeal. The Municipality has indicated that it is seeking costs. If the parties cannot agree on costs, the Municipality should have 10 business days from the release of this decision to provide written costs submissions. Ms. Wilton should have a further 5 business days to respond. Costs submissions are confined to 3 pages, plus a supporting bill of costs.
Released: “DD” October 26, 2020
“David M. Paciocco J.A.”
“I agree. Doherty J.A.”
“I agree. S. Coroza J.A.”