Court File and Parties

Ontario Superior Court of Justice – Divisional Court

Geneen v. Toronto (City)

Date: 1999-01-21

B. Chernos, Q.C., for claimants Geneen, Jack-Pie Holdings Ltd., Metcorp Ltd., Elte Carpets Ltd., Downtown Tennis Courts Inc., Downtown Tennis Club, and Indo-Asian Carpets Ltd.;

S.F. Waqué, for the defendant, City of Toronto;

L. Mcintosh, for the Attorney General, Intervener.

(OMB file L9300002)(OMB file L9300003)

(OMB file L900004)

(Div. Ct. 648/98)

Decision

[1] Philp, J.: This motion brought by the City of Toronto (City) is for an order to quash the application for judicial review brought by David Geneen, Jack-Pie Holdings Ltd. and Metcorp Limited, Elte Carpets Limited, Downtown Tennis Courts Inc., Downtown Tennis Club, and Indo-Asian Carpets Limited, all of whom are hereinafter referred to as "the Claimants".

[2] The application arises out of an order made by Mr. T. Yao, a member of the Ontario Municipal Board (O.M.B.) on a motion brought by the claimants to amend their pleadings to increase the amounts claimed from a total of $25,000,000 to $30,500,000 plus interest.

[3] In his reasons for allowing the amendments on terms to lessen the prejudice, he recited the background leading to the motion to amend from the filing of a fresh statement of claim by the Claimants on May 8, 1992, discoveries in 1994, a motion on November 23, 1995 by the Claimants to compel the City to proceed first with examinations for discovery, a motion on May 9, 1997 by the City for directions and a hearing date. A hearing date was fixed for April 14, 1998. A motion heard in June and July 1997 over "a large number of refusals to answer questions on discovery" had to be adjourned on October 9, 1997 because the Claimants had a scheduling conflict preventing its completion. The order of October 9, 1997 (Order 1) adjourned the June/July motion to January 21, 1998 with costs to the City fixed at $900 for "wasted preparation" payable forthwith in any event of the cause. The hearing date of April 14, 1998 was made peremptory on the Claimants at the request to the City. Order 2 was issued October 23, 1997 dealing with discovery refusals. The Claimants appealed this order to the Divisional Court which was dismissed by a three judge panel on February 5, 1998 [see 107 O.A.C. 308]. The court held that the power to hear appeals of expropriation matters should be restricted to final orders except in exceptional cases (I will return to this decision later).

[4] On February 12, 1998 Order 3 was issued by Mr. Yao dealing with matters argued on January 22, 1998. On February 24, 1998 Mr. Watson, counsel for the Claimants announced the need to bring the motion to amend pleadings. Mr. Scargall for the City submitted that the amendments would require further discovery. The April hearing date could not be preserved, given the fact that many refusals remained to be adjudicated. Arguments on the motion were held on the first week of the aborted hearing on the outstanding matters including the amendment motion. It was argued on April 16, 1998 when it was conceded by the City that the amendments had to be allowed and by the Claimants that they must allow the City to have further discovery and to pay some amount.

[5] The City asked for four terms:

1. The Claimants be disallowed any interest from April 14, 1998 to the start of the new hearing on any amount ordered above the s. 25 offers;

2. The Claimants provide "prima facie evidence" in support of the amended claim (presumably by further discoveries);

3. The fixed costs thrown away at $5,000 payable forthwith is a condition of the amendment; and

4. Costs of the motion at $1,000.

[6] Mr. Yao then discussed rule 26.01 which contemplates that the "unfairness" to the responding party be compensated with costs. The Claimants have found the amounts originally claimed are now insufficient and "the hearing date reserved for nine months now must be discarded. There is no suggestion that the City's conduct has caused the amendment". The aforesaid costs were therefore granted.

[7] In discussing the issue of prejudice to the City caused by the delay resulting from the amendments Mr. Yao considered the case law including the Court of Appeal decision in Kings Gate Developments Inc. v. Colangelo et al. (1994), 1994 416 (ON CA), 70 O.A.C. 140; 17 O.R.(3d) 841 (C.A.), where Carthy, J.A., discusses the meaning of the words "on such terms that are just". Carthy, J.A., speaks of the "unfairness and prejudice to the [plaintiff]" and "the frustration of the judge when faced with a last minute application". Mr. Yao concluded the need for the City to have "prima facie evidence" of the Claimants' new theory supporting the revised quantum.

[8] In considering the question of interest Mr. Yao turned to the decision of Haikola v. Arasenau (1996), 1996 36 (ON CA), 46 C.P.C.(3d) 292 (Ont. C.A.), where the Court of Appeal of Ontario disentitled the plaintiff from prejudgment interest on any amount over the sum originally claimed for a period of eight months which Mr. Yao fairly inferred was probably the time required to get the matter back on the trial list. He noted that s. 33(2) of the Expropriation Act permitted the Board to disallow interest for any part of a delay that is due to the owner which would be the period of delay caused by the amendments. Mr. Yao thereby considered this "a reasonable way to discourage amendments on the eve of a hearing and with the intent of s. 33(2)".

[9] I have reviewed Mr. Yao's Order 5 relating to amendments of the statements of claim in fair detail to show, in my view, that the order made was indeed a reasonable one under the circumstances of the case.

[10] Mr. Chernos, counsel for the Claimants submitted that the order made by Mr. Yao was unreasonable and made because of his bias in favour of the City. I disagree with his submission. In my view the order made with the four terms was a just and reasonable one having regard to the case law cited and the cause of the delay.

[11] Mr. Chernos also submits that a single judge of the Divisional Court has no jurisdiction for hearing this motion to quash the Claimants' application for judicial review and that it should be heard by a three person panel. He argues that I should dismiss the motion and allow the judicial review to be heard at a later date when the appeal to the Divisional Court that the Claimants have brought from the same Order 5 is to be heard. A new hearing date of February 1, 1999 has been set by the Board. This is within two weeks of this decision. Both counsel assure me that the hearing will proceed at that time regardless of my decision. Mr. Chernos says that if I dismiss the motion the issue of interest deduction and the bias of Mr. Yao can be heard by a three person panel on a scheduled date in mid-March at the same time as it hears the appeal.

[12] Turning to the challenge of jurisdiction of a single judge of the Divisional Court to hear this motion submitted by Mr. Chernos, I turn to the following sections in the Courts of Justice Act, R.S.O. 1990, c. C-43.

[13] Section 21(3) of the Act provides that "a motion in the Divisional Court shall be heard and determined by one judge unless otherwise provided by the rules of court".

[14] Section 21(5) provides that "a panel of the Divisional Court may, on motion, set aside or vary the decision of a judge who hears and determines a motion".

[15] By contrast, s. 7(1) of the Act provides that "a proceeding in the Court of Appeal shall be heard and determined by not fewer than three judges sitting together, and always by an uneven number of judges".

[16] Section 7(2) provides that "a motion in the Court of Appeal and an appeal under Clause 6(1)(c) shall be heard and determined by one judge".

[17] Section 7(3) however, provides that "subs. (2) does not apply to a motion for leave to appeal, a motion to quash an appeal or any other motion that is specified by the rules of the court." (emphasis added). Following that process Mr. Justice O'Driscoll in Simanek v. Health Discipline Board (Ont.) (1994), 76 O.A.C. 300 (Div. Ct.), noted at p. 306 that:

"Section 7(3) of the Courts of Justice Act provides that a motion to quash an appeal to the Court of Appeal must be heard by three judges. Neither under s. 21 (3) of the same Act nor under the Divisional Court Practice Direction there is any similar prohibition upon a single judge of the Divisional Court hearing a motion to quash an application for judicial review …

"I find that I have jurisdiction under s. 21 of the Courts of Justice Act to hear a motion to quash an application for judicial review. If I am wrong, s. 21(5) of the Courts of Justice Act provides a 'safety net' and a panel of three judges will have these reasons available to them."

[18] O'Driscoll, J., then proceeded to quash the application for judicial review.

[19] Mr. Waqué, counsel for the City and Ms. Mcintosh, counsel for the Attorney General (Intervener pursuant to s. 9(4) of the Judicial Review Procedure Act) submit that the application for judicial review should be quashed. Mr. Waqué submits that the Claimants are estopped from alleging bias against Mr. Yao because of their failure to raise the issue of bias at the first practical or available opportunity. He cites Energy and Chemical Workers' Union and Atomic Energy of Canada Ltd., Re, 1985 5528 (FCA), [1986] 1 F.C. 103; 64 N.R. 126 (F.C.A.), where MacGuigan, J., at p. 113 states as follows:

"The only reasonable course of conduct for a party reasonably apprehensive of bias would be to allege a violation of natural justice at the earliest practicable opportunity. Here, AECL called witnesses, cross-examined the witnesses called by the Commission, made many submissions to the Tribunal and took proceedings before both the Trial Division and this court, all without challenge to the independence of the Commission. In short, it participated fully in the hearing, and must therefore be taken impliedly to have waived its right to object.

"At common law, even an implied waiver of objection to an adjudicator at the initial stages is sufficient to invalidate a later objection … The principle is stated as follows in Halsbury, Laws of England (4th Ed.), volume 1, paragraph 71, page 87:

'The right to impugn proceedings tainted by the participation of an adjudicator disqualified by interest or likelihood of bias may be lost by express or implied waiver of the right to object. There is no waiver or acquiescence unless the party entitled to object to an adjudicator's participation was made fully aware of the nature of the disqualification and had an adequate opportunity of objecting. Once these conditions are present, a party will be deemed to have acquiesced in the participation of a disqualified adjudicator unless he has objected at the earliest practicable opportunity.'" (Emphasis added)

[20] In our case the Claimants participated in all the orders including Order 5 without objecting to any alleged bias of Mr. Yao even though they were aware of facts that they alleged gave rise to a reasonable apprehension of bias. These include such facts as Mr. Yao being a former employee of the City in its solicitors department, attending at the February 5, 1998 Divisional Court hearing and participating in lobbying efforts for his reappointment to the O.M.B. I question that any one of these facts would raise a reasonable apprehension of bias in an informed right-minded person. Nevertheless the Claimants knowing these facts made no effort to challenge Mr. Yao until after Order 5 was issued. Hence they are estopped from now claiming bias. In any event, I find that none of these facts raises a reasonable apprehension of bias in an informed right-minded person.

[21] The first two orders requested by the applicant Claimants relate to the issue of the requirement of impartiality and apprehension of bias. They wish an order "setting aside the decision of the Chair of the O.M.B. declining to assure claimants that the member to conduct the expropriation compensation hearing will be a member other than Ted Yao". They also seek an order that the member to conduct the expropriation compensation hearing be a member other than Mr. Yao.

[22] In a letter dated November 20, 1998 addressed to Mr. Chernos, the Chair of the O.M.B. advised that Mr. Yao "is prepared to withdraw from any further proceedings in connection with these matters. He emphatically denies the allegations made in the material filed". He views the allegations made "as an unfounded personal attack". The letter states further that the Board "expressly rejects the allegations made in the material filed in support of the application for judicial review. Nevertheless in order to avoid delay and costs the Chair has assigned another panel to conduct the hearing scheduled for February 9, 1999".

[23] In view of the contents of this letter, the first two orders sought by the Claimants are now moot. Nothing further need be said about that issue except that counsel for the Claimants right up to this hearing continues to attack Mr. Yao because of alleged apprehension of bias. The purpose of such persistence seems to involve the apparent need to show his bias as it relates to his Order 5 which understandably is not agreeable to the Claimants. Nevertheless it is my view despite the Claimants' dislike for the order that it is reasonable and justifiable under these circumstances.

[24] The third order sought by the Claimants is to set aside Order 5 dated June 12, 1998. This order in my view is clearly interlocutory in nature. It is not a final order. The general rule carried out by this court is not to interfere with such interim orders, in this case to allow the Claimants to amend their statement of claim and to lessen the prejudice caused to the City because of the delay resulting from the amendment.

[25] In the appeal by the Claimants of Mr. Yao's Order 2, this court on February 12, 1998 [107 O.A.C. 308] through Mr. Justice Southey, speaking for the panel, dismissed the appeal stating that the Expropriation Act providing for an appeal to the Divisional Court "from any decision or order of the Board" permits an appeal only from a final order or decision of the Board.

[26] Southey, J., goes on to state that to permit such applications at an earlier stage than a final order "would result in the fragmentation of the process and a very undesirable lengthening of the time required to deal with the matters in issue". He referred to the decision of this court in Ontario College of Art et al. v. Human Rights Commission (Ont.) (1993), 1993 3430 (ON SCDC), 63 O.A.C. 393; 11 O.R.(3d) 788 (Div. CO, where Callaghan, C.J.O.C, stated that the court's approach where the application is brought prematurely is to quash it "absent the showing of exceptional or extraordinary circumstances" demonstrating that the application must be heard. This is because of the need to avoid a piecemeal approach to judicial review of administration action. Chief Justice Callaghan goes on to state at p. 800:

"The board of inquiry in this case has jurisdiction to entertain and determine any of the issues that have been … advanced … This includes [the] argument that bias has tainted the appointment of the board of inquiry. … For some time now, the Divisional Court has … taken the position that it should not fragment proceedings before administrative tribunals. Fragmentation causes both delay and distracting interruptions in administrative proceedings. It is preferable, therefore, to allow such matters to run their full course before the tribunal and then consider all legal issues arising from the proceedings at their conclusion. In particular, at that time, these applicants will have a full right of appeal."

[27] In my view there are no exceptional or extraordinary circumstances in this case.

[28] For these reasons I therefore strike out or quash the notice of application for judicial review with costs to the City of Toronto hereby fixed at $3,000.

Motion allowed.