250 Bridgeland Realty Inc. v. Ontario (Min. Transportation), 2019 ONSC 6053

CITATION: 250 Bridgeland Realty Inc. v. Ontario (Min. Transportation), 2019 ONSC 6053

COURT FILE NO.: DC 551/16 DATE: 20191028

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Smith, D.L. Corbett and Myers JJ.

B E T W E E N:

250 BRIDGELAND REALTY INC. Applicant

• and -

HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF ONTARIO AS REPRESENTED BY THE MINISTER OF TRANSPORTATION and CITY OF TORONTO Respondents

COUNSEL: Michael I. Binetti, for the Applicant Judie Im and Julia McRandell, for Ontario Roberto E. Zuech, for Toronto

Heard at Toronto: May 1, 2019

REASONS FOR DECISION

D.L. Corbett J.:

[1] The applicant owns a one-storey industrial building at 248-250 Bridgeland Avenue which backs onto Highway 401 near the Yorkdale Shopping Mall in Toronto (the “Building”). The applicant has a sign atop the Building (the “Sign”) currently advertising personal injury litigation services for Diamond & Diamond LLP.

[2] Building signs of this kind are regulated by both the City of Toronto and the Ministry of Transportation of Ontario (“MTO”). By Notice given September 26, 2013 and by Direction dated November 14, 2013, MTO advised the applicant that it did not have a valid permit for the Sign and, pursuant to s.38(5)(b) of the Public Transportation and Highway Improvement Act[^1] (the “Act”), directed the applicant to take the Sign down.

[3] By Notice of Revocation of Permit dated August 12, 2016, Notice of Violation issued August 18, 2016, and Notice of additional grounds for Revocation dated October 26, 2016, Toronto gave notice that it was revoking the municipal sign permit for the Sign because there was no MTO permit for the Sign and because the Sign had been changed without a new permit.

[4] The applicant asks this court to quash MTO’s Notice and Direction and Toronto’s three Notices, and for related relief to allow the applicant to leave the Sign in place.

Summary and Disposition

[5] The Sign contravenes the Act, MTO policy, applicable by-laws of the former City of North York and current by-laws of Toronto. The processes followed by MTO and Toronto in this case were imperfect but fair. For the reasons that follow, the application is dismissed.

Jurisdiction and Framework

[6] The parties agree that this court has jurisdiction to review the impugned decisions pursuant to s.2(1) of the Judicial Review Procedure Act.[^2] MTO’s and Toronto’s decisions are reviewable on a standard of reasonableness.[^3] The applicant’s procedural allegations are assessed on a standard of fairness.[^4]

Statutory Framework

(a) Provincial Regulation of Highway Signage

(i) The Legislation

[7] The Sign is adjacent to and within 400 metres of Highway 401 in Toronto.

[8] Highway 401 is a “controlled-access, Class 1 highway.”[^5]

[9] Paragraph 38(2)(e) of the Act provides:

38(2) Despite any general or specific Act, regulation, by-law or other authority, no person shall, except under permit therefor from the Minister…

(e) display any sign, notice or advertising device, whether it contains words or not, other than one sign not more than sixty centimeters by thirty centimeters in size displaying the name or the name and occupation of the owner of the premises to which it is affixed or the name of such premises within 400 metres of any limit of a controlled-access highway….[^6]

[10] Subsection 38(11) of the Act provides:

38(11) The Minister may issue permits under this section in such form and upon such terms and conditions as he or she considers proper and may in his or her discretion cancel any such permit at any time.[^7]

[11] Paragraph 38(5)(b) of the Act provides:

38(5) The Minister may direct any owner of land…

(b) to remove therefrom or alter thereon any sign, notice or advertising device displayed…

in contravention of subsection (2).[^8]

[12] The “Minister” is the Ontario Minister of Transportation, responsible for the MTO.[^9]

(ii) The Corridor Signing Policy

[13] MTO specifies the forms, terms and conditions upon which sign permits may be issued in its “Corridor Sign Policy” (the “Policy”). The current Policy has been in force since 2010. The predecessor version, issued in 1996, is substantially identical to the current Policy in respect to the matters at issue in this application. Citations to the Policy in this decision are to the current version issued in 2010.[^10]

[14] The Policy provides that, in addition to meeting the requirements for a permit set out in the Policy:

… a property owner/permit holder must meet all of the requirements of the local municipality and any other agency having jurisdiction over the placement of signs.[^11]

[15] Under the Policy, a person wishing to display a Corridor Sign must submit an application to MTO, together with payment of a fee and supporting documentation including a copy of the proposed sign, the proposed message to be displayed on the sign, and a site plan. The application must indicate the type of sign for which a permit is sought, and whether the application is for permission to erect a sign or to alter an existing sign.[^12]

(iii) Location Signs and Billboards

[16] The Policy distinguishes between “location signs” and “billboard signs”. A location sign “advertises goods or services available on the property the sign is located on”. A billboard sign “contains a message that is not related to the property the sign is located on”.[^13]

[17] A location sign must comply with applicable municipal by-laws, be in good taste, and comply with a number of safety requirements including, if the sign is over 8 metres in height, the design for the sign must have a stamp of approval from a professional engineer. The sign must not create a traffic hazard, an issue that is in MTO’s discretion.[^14] The “copy” (content) of a location sign may not be changed without MTO approval.

[18] The “copy” (content) on a billboard sign for which a permit has been issued may be “changed from time to time” without requiring a new permit, so long as the size and setback of the sign remains the same.[^15] However, as noted above, billboard signs are not permitted within 400 metres of a Class 1 or Class 2 Highway such as the 401.

(iv) Alteration or Replacement of Signs

[19] When a sign is to be changed, a new permit is required, and the change must meet current MTO requirements. An application to change a sign may be approved or refused at the discretion of MTO.[^16]

(b) Municipal Regulation of Signs

(i) Applicable By-laws

[20] The City of Toronto was amalgamated in 1998. Prior to amalgamation, the applicant’s property was in the City of North York; after amalgamation it was in the City of Toronto.

[21] At amalgamation, each amalgamated city had its own sign by-laws. Those by-laws were not repealed and are still in force. The North York sign by-law, By-law No. 30788, governed the Sign when it was erected, as described below.

[22] In February 2010, the City of Toronto enacted:

a. its current sign by-law (Chapter 694 of the Toronto Municipal Code), and

b. its current by-law imposing taxes for third party signs (Chapter 771 of the Toronto Municipal Code).

These two by-laws came into force on April 6, 2010.

[23] North York By-law 30788 continues to govern any sign for which a permit was issued by North York prior to enactment of Toronto Municipal Code Chapter 694 provided the sign was lawfully in place as of April 6, 2010 and has not changed since.[^17]

(ii) The North York Sign By-law

[24] Section 2.2.1 of North York By-law 30788 provides:

… no person shall erect, display, repair or alter or cause or permit any sign to be erected, displayed, repaired or altered, unless a permit is obtained therefor.

[25] Section 3.2.1 of the North York By-law provides that any sign erected under the by-law must at all times comply with the by-law, the Building Code and any applicable governmental regulations (including obtaining and maintaining a valid permit under the Act).

[26] Section 1.1.1 of North York By-law provides:

“Alter, Altered or Alteration” means any change to the sign structure or the face of the sign with the exception of:

(i) A change in the message displayed on the sign,

(ii) The re-arrangement of numerals, letters or copy applied directly to the face of a sign and specifically designed and intended to be periodically re-arranged,

(iii) Repair and maintenance, including replacement by identical components, as required by the By-law.

[27] In the North York By-law, an “Off Premise Sign” is “an advertisement related to a business or manufacturing enterprise or other activity not conducted within the building or upon the premises on which the sign is erected.” This is similar to the definition of a “third party sign” in the Toronto sign by-law, set out below. There is no definition of a “first party sign” in the North York By-law.[^18]

[28] Paragraph 2.5.1 of the North York By-law provides that the Chief Building Official is authorized to revoke a sign permit at any time after its issuance where the sign no longer conforms to the provisions of the by-law, the Building Code or any other applicable governmental regulation. The requirement to obtain and maintain a valid permit under the Act is an “applicable governmental regulation” within the meaning of this provision.

(iii) Provisions of the Toronto By-law

a. General provisions

[29] Section 694-5 of the Toronto Municipal Code provides:

A. No person shall erect, display, modify, or restore or cause to be erected, displayed, modified or restored any sign within the City without first obtaining a sign permit from the Chief Building Official pursuant to this chapter.

B. No sign or permit shall be issued until approvals have been obtained, where applicable, from the following:

(1) Ontario Ministry of Transportation….

[30] Section 694-28 of the Toronto By-law provides:

A. The Chief Building Official may issue a Notice of Violation, that shall require the sign to be brought into compliance with this chapter within 14 days to any person who:

(1) Has erected, displayed, modified or restored or has caused to be erected, displayed, modified or restored a sign without first having obtained a sign permit to do so; or

(2) Having obtained a sign permit, has erected, displayed, modified or restored or has caused to be erected, displayed, modified or restored a sign contrary to the sign permit issued.

B. Where a Notice of Violation has been issued under Subsection A and the sign has not been brought into compliance with this chapter within 14 days, the Chief Building Official may remove or cause the sign or any part thereof to be removed or may take any action necessary to prevent the sign copy from being displayed, and the City may recover the costs incurred by action or by adding the costs to the tax roll for the property on which the sign was located and collecting them in the same manner as property taxes.

[31] If a permit was issued under the North York By-law, and revoked after the coming into force of Chapter 694 of the Toronto Municipal Code on April 6, 2010, the sign is considered a sign being displayed unlawfully for the purposes of Chapter 694. A Notice of Violation may be issued requiring removal of the sign because it is being displayed without a permit.

b. First and Third Party Signs

[32] First and Third Party Signs are defined for the purposes of Toronto’s sign by-law in s.694-1 of the Toronto Municipal Code as follows:

FIRST PARTY SIGN – A sign which identifies, advertises, promotes or directs attention to a business, service or activity available at the premises where the sign is located….

THIRD PARTY SIGN – A sign which advertises, promotes or directs attention to businesses, goods, services, matters or activities that are not available at or related to the premises where the sign is located.

[33] A “first party sign” under the Toronto sign by-law is substantially the same as a “location sign” under the MTO Policy.

c. Taxation of Third Party Signs

[34] Toronto imposes a tax on third party signs, but not on first party signs, pursuant to Toronto Municipal Code Chapter 771. The definition of “third party sign” for the purposes of this tax is identical to the definition in Toronto’s sign by-law (Municipal Code, s.694-1) in respect to any “sign located within the City of Toronto” which has “an aggregate sign face area of greater than 1.0 square metre” (Municipal Code Chapter 771-2).

(c) Building Permits

[35] Most signs (including the Sign) require a Building Permit pursuant to the Building Code Act[^19] as well as a sign permit from the City. Prior to 2010, Toronto and North York issued one permit for a sign that functioned as both a sign permit under the applicable sign by-law and a building permit under the Building Code. Since the enactment of Chapter 694 of the Toronto Municipal Code, effective April 6, 2010, Toronto changed its practice and it now requires and issues two separate permits: one pursuant to its sign by-law and one pursuant to the Building Code.

(d) “Applicable Law”

[36] Where a permit is required by the Act, a valid MTO permit is required for a permit under both the North York and Toronto sign by-laws and under the Building Code.[^20]

The Applicant’s Signs

[37] The applicant purchased the property at 248-250 Bridgeland Avenue, Toronto, in 1997.

[38] In May 2002, the applicant submitted an application for a sign permit to MTO for a “location sign” within 400 metres of Highway 401. The permit applied for was for a sign described as “BBQ picture + Broil King (logo) + Reliable Parts” with a telephone number. Included with the permit application was an image of the proposed copy for the sign as well as engineering drawings and copy of a sublease showing Reliable Parts as a business with goods or services available at the site. A location sign permit was approved by MTO on August 23, 2002.

[39] The MTO permit included various conditions, including:

(3) The issuance of a permit does not relieve the applicant of the responsibility of complying with relevant municipal by-laws.

(4) If a permit is issued it relates only to the sign as described in the permit. By signing this application the owner gives MTO permission to enter on the land to remove any sign that is altered or is not maintained in good repair according to MTO requirements.[^21]

[40] On September 5, 2002, the applicant submitted an application to the City of North York for a sign permit. This application was made both for a sign permit and a building permit (as was the practice at the time). The application was accepted and permit 02 169880 SGN SP under the sign by-law and the Building Code was issued by North York on January 15, 2003.

[41] In support of the application for the North York permit, the applicant submitted engineering drawings depicting a steel rooftop structure with two faces described as a “Typical V Shape Sign 25.0 x 10.0’ Backlit”. Pursuant to a request by the City of North York, the applicant also provided a letter from an engineer describing the sign faces as a “sign box with a shelf weight that will not exceed 1000 lbs.” It was on the basis of this description that the permit was issued: two backlit sign boxes, each of which weighed no more than 1000 lbs.

[42] Also in support of the application, the applicant provided a letter from MTO to which was attached the MTO permit for the Sign. The MTO permit was for a roof sign with the following message on the sign: “Reliable Parts 416-787-4212, Broil King, Weber”. The second MTO permit condition states that the Sign “must only advertise what is related to this property”.

[43] From 2003 to 2013, numerous changes were made to the sign, including changing it to a backlit sign, changing it again from backlit to plywood faces, changes to the catwalks, and multiple changes to the businesses advertised (including advertising Nestea iced tea and Standard Life Financial, neither of which businesses were occupants of the property or goods or services sold to the public by occupants of the building). The applicant did not submit applications to MTO for any of these changes.

[44] In 2013, MTO, in partnership with the City of Toronto, carried out sign enforcement activities of sites within 400 metres of a provincial highway. MTO observed the Sign displaying copy advertising Diamond & Diamond LLP. MTO determined that the Sign did not conform to the engineering drawings submitted with the permit application in 2002, and that the Sign copy had been changed from the copy permitted in 2002. MTO concluded that there was no valid permit for the Sign and that the Sign did not comply with the Policy.

[45] MTO issued the Notice, dated September 26, 2013, notifying the applicant that the Sign was not in compliance with the Policy, and that the applicant did not have a current valid permit for the Sign. MTO instructed the applicant to remove the Sign or to retrofit it to comply with all MTO policies by October 7, 2013.[^22]

[46] The applicant did not comply with MTO’s Notice. MTO then issued the Direction, dated November 14, 2013, requiring the applicant to remove the Sign on the basis that it was displayed in contravention of s.38(2) of the Act (that is, that the applicant did not have a valid permit for the Sign). The Direction also stated that failure to comply with the Direction within 30 days could result in the Minister authorizing a person to enter the land to enforce compliance, and/or a fine.[^23]

[47] In April 2014, the applicant advised MTO that Diamond & Diamond LLP was a tenant at the Building. However, the applicant did not submit an application to alter or replace the Sign, it did not submit a fresh application for the Sign, and it did not, at this time, provide evidence that the Diamond & Diamond LLP was a tenant at the Building.

[48] In May 2014, MTO’s sign enforcement efforts were placed in abeyance for budgetary reasons. The Notice and Direction remained, but no further steps were taken by MTO to secure compliance with those decisions.

City Enforcement of Sign By-laws Along 400 Series Highways in Toronto

[49] In late 2008 and early 2009, City staff created an inventory of signs that they believed were third party signs displayed along the 400 series of highways in Toronto in violation of MTO Policy and municipal by-laws. As part of this inventory, many signs were identified for which permits had been issued as first party signs which had apparently been changed to third party signs.

[50] In the spring of 2016[^24] Toronto’s “Sign Unit” initiated an enforcement campaign respecting suspected third party signs within 400 metres of 400 series highways in Toronto. A list of these signs was provided to MTO, which was asked to advise of MTO permit status for the signs on the list. The Sign was on this list.

[51] On July 15, 2016, MTO responded to Toronto’s request as to the permit status for the list of signs, including the Sign. MTO advised that the Sign did not have a valid MTO permit.

[52] When Toronto received MTO’s response, it revoked the municipal permits for signs which did not have valid MTO permits. The Sign did not have such a permit, and so its municipal permit, issued by North York in 2003, was revoked.

[53] MTO did not otherwise take part in Toronto’s 2016 enforcement activities but it did note in May 2017 that the Sign had apparently been changed again without a permit from MTO.

The Applicant’s Position

[54] The applicant takes the position that it obtained valid sign permits from MTO and North York in 2003 and that those permits continue to be valid today.

[55] The applicant argues that MTO “erroneously” characterized the Sign as a third party sign, and erroneously revoked the MTO permit as a result in 2013. It argues that it was only after it provided evidence that Diamond & Diamond LLP is a tenant at the property (and thus the Sign is a third party sign), that Toronto took the position that changes made to the Sign since 2003 were unlawful because they had been made without a permit. The applicant adduced evidence that the Sign, as currently configured, is smaller than that for which the permits were issued in 2003, and that the changes that have been made are within the “normal course of maintenance for which permits are not normally applied”.

Analysis

[56] As stated at the outset of these reasons, judicial review is available from MTO’s decision revoking its permit in 2013, and for Toronto’s decision revoking the North York permit in 2016 and ordering the Sign removed from the Building.

1. MTO’s Decision Is Reasonable: the Sign is a Third Party Sign

[57] MTO revoked its permit because it found that the Sign is a third party sign, and thus may not be displayed within 400 metres of a 400 series highway. The applicant argues that this decision is unreasonable because Diamond & Diamond LLP is a tenant at the Building. In support of this argument, the applicant has produced leases pursuant to which Diamond & Diamond LLP has rented a 663 square foot “fully-serviced office space”, two parking spaces, together with the right to use the Sign. The applicant notes that Diamond & Diamond LLP “spent $3700 improving the floors of the office” and “even put their name on the door”.

[58] The respondents argue that the Sign became a third party sign at least ten years ago and that the tenancy for an office is a ruse to try to get around the prohibition against third party signs. In support of this argument, they note:

a. In September 2007, the Sign advertised a security company, Alarmforce. There is no evidence that Alarmforce was ever a tenant at the Building, and the advertising copy on the Sign for Alarmforce did not suggest that the company did business at the Building.

b. In 2009, the Sign displayed the following message: “Lease or Buy this Sign and Get an Office here”, followed by a phone number. From this message it is clear that the sign was being let, as a primary commercial goal, and the office rental was an adjunct feature of the arrangement.

c. From June 2009, the Sign was rented by Astral Media Outdoor L.P. for a five year term. During some of this period the Sign displayed advertising for Vitao, a Nestea Iced Drink (on one face of the Sign) and Standard Life Financial (on the other face of the Sign). Neither Nestle (which owns Nestea) nor Standard Life were ever tenants at the Building, nor were their products or services ever offered for sale to the public from the Building.

d. From at least as early as 2014, the Sign has shown copy for Diamond & Diamond LLP. None of the copy displayed advertises the Building as an office location of Diamond & Diamond LLP: the copy has always presented as a third party sign.

e. Inspections of the Building established that there are two active businesses there: Yorkdale Hardwood Flooring and an office furniture business called Workspace Group. These businesses are clearly identified by signs at the front and back of the Building.

f. There are no signs for Diamond & Diamond LLP on the face of the Building. The space rented by Diamond & Diamond LLP is at the back of the Building, under a sign for Workspace Group.

g. No person was seen in the Diamond & Diamond LLP unit, which was locked during business hours.

h. There is a small decal saying “Diamond & Diamond Personal Injury Lawyers” affixed to a door at the back of the Building, which can be read if someone approaches near the door. There is construction debris beside the door which did not change between inspections.

i. Photographs taken through the window of the Diamond & Diamond LLP office show office furniture and computer equipment that is not in use. The computer equipment appears to be outdated and not connected or plugged in. The position of the furniture and equipment, and other items, did not change between inspection visits (including locations of a computer mouse, an open catalogue displaying advertising copy for Diamond & Diamond LLP, an open drawer in a credenza, and items on a desk – all items that would be expected to change positions at least slightly if they were in use). The photographs do show that two boxes, shown on the floor in one photograph, were moved or removed, other boxes stored on shelves appear to have been moved, and one chair appears to have moved.

j. An internet search of Diamond & Diamond LLP disclosed that the Building was not listed as an office location for the firm.

k. The City’s third party sign tax was paid for the Sign from 2011 to 2016. An invoice was sent to the applicant for the tax for the years 2011 to 2015 and was paid by the applicant. The 2011 taxes collected from the applicant were subsequently refunded ($4,950), because it was determined that the tax for that year was paid directly by the advertiser at the time. The applicant was billed for third party sign tax for 2016. The 2011 refund was applied to this tax bill, and the applicant paid the balance owing for 2016 ($304). The 2017 taxes were not paid, and a notice of objection was filed, on the basis that the applicant takes the position that the Sign is not a third party sign. The City concludes that the applicant admitted that the sign is a third party sign by its payment of taxes for 2011 to 2016, and that its objection in 2017 was rooted in its concern that the proper characterization of the Sign as a third party sign would lead to the Sign’s removal.

l. The Sign was not Diamond & Diamond LLP’s only unlawful sign facing Highway 401. At another industrial property facing the highway, Diamond & Diamond LLP had placed a third party sign and apparently rented a small space, unused for the practice of law, with a firm decal on a door at the back of the building, similar to the arrangement at the Building. Diamond & Diamond LLP’s sign at this other location was removed as a result of City enforcement measures.

m. The copy on the Diamond & Diamond LLP advertisement on the Sign does not suggest that its legal practice is being conducted at the Building. It does not display the address of the Building or directions to get to the Building from Highway 401. It displays a phone number that is not a phone number for the Building.

The City concluded that the Building was not used by Diamond & Diamond LLP to conduct business with the public.

[59] The applicant provided Toronto with emails from Diamond & Diamond LLP in which the firm said that it does use the office at the Building to meet with clients and to conduct its legal practice from time to time. The applicant criticizes Toronto for not following up on these emails with Diamond & Diamond LLP directly. On this application, the applicant puts these emails before the court, but does not adduce any evidence from Diamond & Diamond LLP as to the law firm’s use of the Building.

[60] As noted by the respondents, the applicant does not give evidence that it is informed by someone at Diamond & Diamond LLP, and truly believes, that the law firm is carrying on its practice of law in the small, unsigned, rear office, at the back of an industrial building facing Highway 401. On this basis the emails from Diamond & Diamond LLP are not admissible for the truth of their contents on this application. Further and in any event, this is a crucial aspect of this application. The respondents have adduced considerable evidence to show that Diamond & Diamond LLP is not really carrying on its practice of law at the Building. The absence of direct evidence in the applicant’s materials weighs against the assertion that Diamond & Diamond LLP is carrying on its practice of law at the Building.

[61] The question on this application is whether MTO’s decision that the Sign is a third party sign is reasonable. Clearly it is. I so conclude for the following reasons:

a. The characterization of the nature of the Sign turns primarily on its content and the relationship of that content to business carried on at the Building.

b. The content of the Sign is a third party advertisement. It does not tell the public to come to the Building for the advertised services. This, by itself, is a sufficient basis for concluding that MTO’s decision is reasonable.

c. As disclosed by Toronto’s investigation, the Sign does not relate to business carried on at the Building. The office lease is a ruse to enable the applicant (and Diamond & Diamond LLP) to claim that the Sign is a first party sign. Even if it could be established that, on rare occasions, lawyers met clients, by pre-arrangement at the office (a claim that is not established on the evidence in this application), this would not convert the third party sign to a first party sign: persons seeing the Sign would not know to come to the Building to do business with Diamond & Diamond LLP. If they did, they would find no one there and the door locked.

[62] The prohibition on third party signs within 400 metres of a 400 series highway reduces aesthetic blight beside highways, and the distraction and resulting traffic hazard such advertisements create along fast-moving, heavily-travelled corridors, where momentary distractions can be disastrous. The Diamond & Diamond LLP advertisement is, on its face, a third party sign. Its characterization is not changed by the law firm’s rental of an idle office, to which it does not invite the public as a regular place of business, and which is, apparently, used primarily for storage of boxes.

[63] This is sufficient to dispose of this application: MTO’s decision to revoke the permit in 2013 was reasonable at the time that decision was made and remains so today. The Sign is a “billboard sign” within the meaning of the Policy and a “third party sign” within the meaning of North York By-law 30788 and City of Toronto Municipal Chapter 694. It is not permitted within 400 metres of Highway 401. If the Sign had been a “location sign” under the Policy (which it is not), the applicant breached the Policy by changing the copy on the Sign numerous times without MTO approval for the changes. Toronto’s decision to revoke the North York permit on the basis that the applicant does not have a valid MTO permit is thus properly founded and is also reasonable.

2. Toronto’s Additional Reasons: The Sign Has Been Changed

[64] The applicant argues that changes made to the Sign over the years did not require it to obtain permits for the changes. It says that the changes were minor, in the nature of maintenance and adoption of safety features. Toronto argues that the alterations made from time to time are well beyond “minor” and required sign and building permits.

[65] MTO’s 2013 decision rested upon the Sign being a “billboard sign” and not a “location sign”. It is clear that the decision could also have been justified on the basis of unauthorized changes to the Sign: among other things, a change in the message displayed on a first party sign requires a new permit from MTO. It is clear that the message changed multiple times over the years, and no new permit was ever sought. I start my analysis of this issue with this point about MTO permitting, because it is fundamental to its sign regulation along 400 series highways. I then consider the arguments made by Toronto, which concern City regulation of buildings and structures on buildings.

a. Changes to the Advertising Copy

[66] As noted above, when a “billboard sign” permit is granted by MTO, copy on the sign may be changed from time to time without a fresh permit from MTO. And this makes sense: if the sign is for general advertising purposes, it is to be anticipated that copy may change regularly as different products or services are advertised. MTO, having authorized a “billboard sign” for advertising, does not review copy for every new advertisement posted on a sign that can be seen from a road.

[67] “Location signs” are different. They are expected to be of some permanence (that is, a business moving into and carrying on business at a building, can be expected to stay in that location for years, not months or weeks). First party signage is intended to identify business premises. It is not intended that the copy will change frequently, and, indeed, the prohibition on changing the copy displayed on the sign without a new permit reduces the risk that first party signage rights will be misused to display third party advertising.

[68] In this regard, I agree with MTO’s submission at paragraph 60 of its factum:

The onus is not on MTO to monitor all Corridor Signs in the province at all times, observe any alteration to or replacement of any sign, and then to seek further information from the property owner to try to determine if the altered or replaced sign is compliant with MTO policy. This would be inconsistent with both the plain language of the [Act] and the objectives of the [Act], as well as practically infeasible. The onus is on any person who wishes to display a sign to ensure that he or she has permission from MTO. This onus is not limited to when a sign is first erected; it is an obligation which attaches to any sign which is being displayed, and thus logically includes signs which are altered or replaced.

[69] The applicant was required to seek a new permit every time the copy of the Sign changed. It never did this. Changes in content were material changes to the Sign, and the applicant’s failure to obtain fresh MTO permits each time the copy changed was a breach of MTO’s requirements and a sufficient basis for MTO to revoke the applicant’s permit.

b. Physical Changes to the Sign

[70] Signs the size of the Sign require a building permit. That is because they may pose safety hazards – to the building to which they are affixed (in terms of the load to the building’s structure), and to the surrounding area (in terms of the risks of the sign being dislodged by wind or other events). The size and nature of a sign may also contribute to other safety and environmental concerns, such as driver distraction and aesthetic blight. Changes to the material weight and position (or footprint) of the sign and the manner in which it is displayed (lighting, electronic display, moving images, glare), all require new municipal permits – both a sign permit and a building permit.

[71] The applicant acknowledges that there have been many physical changes to the Sign over the years, but argues that these changes, individually or in the aggregate, are not material enough to require new permits. The respondents argue that the changes have been significant and clearly required fresh permits. The applicant proffers evidence from Keith Edwards on what constitutes “maintenance” as opposed to “changes” to a Sign for permitting purposes. Mr Edwards’ evidence is not necessary and thus is not admissible: it is for the City to decide, within the bounds of reasonableness, where the line is drawn between minor repairs and maintenance that do not require a new permit, and changes that do require a new permit. Mr Edwards’ evidence is premised on the existence of two distinct categories, and Mr Edwards’ view of the correct delineation between them. This would be to apply a correctness standard to the issue before this court. Further, the topic on which Mr Edwards offers his opinion is (a) one of the ultimate questions for this court to answer and (b) is not within a recognized discipline or area of expertise (categorization of work on building signs for the purposes of municipal permitting requirements). In my view Mr Edwards’ affidavit ought not be received into evidence as expert opinion evidence.[^25]

[72] A review of photographs of the sign on the applicant’s building over time makes it clear that there have been changes. The significance of those changes, for permitting purposes, is within their specialized expertise of the respondents, and is for them to decide within the bounds of reasonableness. The decision that the changes to the Sign do require a permit are justifiable on the record, transparent on the reasons given, and fall well within a range of reasonable decisions.

3. Procedural Fairness

[73] The applicant argues that it was denied fairness by the MTO. I see little merit to this argument.

[74] First, the duty of fairness in this case was at the low end of the spectrum.[^26] The impugned decisions concern a single sign. They arise in a regulatory context in which the granting of permits is discretionary, the applicable rules and policies are clear, and the applicant is able to apply for a new sign permit at any time. The underlying issue does not concern a right or entitlement but rather a benefit: the impugned decision does not have consequences analogous to a licensing decision that could affect the ability of a person to carry on a business or trade.[^27]

[75] Second, the applicant had an opportunity to raise its concerns about the impugned decisions with MTO, and with Toronto, and it did so. MTO and Toronto then voluntarily withheld enforcing their decisions prior to hearing of this application for judicial review. In all, the applicant has had the benefit of the Sign – and revenue from the Sign – for six years from the time that MTO first gave notice that the Sign was in breach of the policy and would have to be removed.

[76] The process followed here was by no means perfect. It is not clear when copies of the Notice and Direction were provided to the applicant (the applicant received them no later than April 2014). Then, once the Notice and Direction were provided to the applicant, the applicant wrote MTO to challenge the impugned decisions and to claim that Diamond & Diamond LLP is a tenant, and that the Sign is a “location sign”. At this same time MTO ceased its enforcement activities for budgetary reasons, so, from the perspective of the applicant, it appeared that MTO had dropped the matter. Then, “out of the blue”, over two years later, Toronto revoked the municipal sign permit on the basis of the earlier decisions of MTO.

[77] But did this work any unfairness on the applicant? Quite the contrary. The applicant had the benefit of an additional two years in which to lease the Sign to Diamond & Diamond LLP. Then, when Toronto initiated sign by-law enforcement in 2016, the applicant challenged MTO’s underlying decision, eventually leading to this application, which has been prolonged. The net result has been that the applicant has rented out the Sign, without a proper permit, for almost six years from the time it received notice from MTO that the Sign was unpermitted and would have to come down or be approved pursuant to a new permit application.

[78] From a practical perspective, the applicant has had full notice of the allegations that the Sign is not a location sign since 2014 and notice of Toronto’s allegations about physical changes to the Sign since 2016. The applicant has had a full opportunity to respond to these allegations and to have its concerns addressed. It is still open to the applicant to apply for a new permit. In all the circumstances the applicant has been treated fairly.

[79] Finally, the applicant argues that there was something improper in Toronto enforcing sign by-laws after personnel at MTO were directed to cease enforcement for budgetary reasons. There is no merit to this argument. Either or both of Toronto or MTO may enforce sign by-laws, and cooperation between provincial and local governments is proper in sign enforcement.

4. Third Party Sign Tax

[80] In the final paragraph of its factum, the applicant asks the court to “set aside any tax liability” for the Sign as a third party sign because it is, in fact, a first party sign.

[81] It follows from this decision that this court concludes that the Sign has been displaying third party advertising for Diamond & Diamond LLP. There is evidence that the Sign has been used a third party sign at other times.

[82] The applicant did not seek relief respecting third party sign taxes in the notice of application. Further, there is a prescribed process for challenging the tax claimed by the City: the applicant may first seek reconsideration from the Chief Building Officer of the tax levied by the City. The reconsideration decision of the Chief Building Officer may be further appealed to Toronto City Council. The Toronto Municipal Code provides a course of appeals and reviews that have not been exhausted by the applicant. Given these facts, I would not permit the applicant to pursue review of the tax issue before this court, without prejudice (a) to the applicant’s rights to seek reconsideration from the Chief Building Officer and to appeal to Toronto City Council, and without prejudice to whatever rights of appeal or judicial review that the applicant may have after it has exhausted the City’s process. However, by “without prejudice” I do not foreclose an argument of issue estoppel on the basis of this court’s finding that the Sign displaying copy for Diamond & Diamond LLP is a third party sign.

Disposition and Costs

[83] The application is dismissed.

[84] If the parties cannot agree on costs then the respondents shall deliver submissions by November 22, 2019. The applicant shall deliver responding submissions by December 6, 2019.

___________________________ D.L. Corbett J.

___________________________ Smith J.

___________________________ Myers J.

Date of Release: October 28 , 2019

CITATION: 250 Bridgeland Realty Inc. v. Ontario (Min. Transportation), 2019 ONSC 6053

COURT FILE NO.: DC 551/16 DATE: 20191028

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Smith, D.L. Corbett and Myers JJ.

BETWEEN:

250 Bridgeland Realty Ltd. Applicant

– and –

Her Majesty the Queen in right of Ontario as represented by the Minister of Transportation and City of Toronto Respondents

REASONS FOR DECISION

D.L. Corbett J.

Date of Release: October 28, 2019

[^1]: Public Transportation and Highway Improvement Act, RSO 1990, c.50. [^2]: Judicial Review Procedure Act, RSO 1990, c.J.1, s.2(1). [^3]: Dunsmuir v. New Brunswick, 2008 SCC 9, paras. 53, 123. [^4]: Baker v. Canada (Minister of Citizenship and Immigration), 1999 699 (SCC), [1999] 2 SCR 817, paras. 21-22. [^5]: Public Transportation and Highway Improvement Act, RSO 1990, c.50, ss.34(11) – (13), 38. [^6]: Public Transportation and Highway Improvement Act, RSO 1990, c.50, s.38(2)(e) (emphasis added). [^7]: Public Transportation and Highway Improvement Act, RSO 1990, c.50, s.38(11) (emphasis added). [^8]: Public Transportation and Highway Improvement Act, RSO 1990, c.50, s.38(5)(b) (emphasis added). [^9]: Public Transportation and Highway Improvement Act, RSO 1990, c.50, s.1. [^10]: 2010 Policy, found at Ontario Responding Record, tab 1B, pp. 86-165. [^11]: Policy, s.3.5. [^12]: Policy, p.15; sign permit application of the Applicant, Respondent’s Application Record, tab D, pp. 170-182. [^13]: Similar to a City of Toronto third party sign: see below, para. 32. [^14]: Policy, s.8. [^15]: Policy, ss.9, 9.13. [^16]: Policy, s. 4.13-4.16. [^17]: City of Toronto Act, 2006, SO 2006, cv.11, s.110(1), subsequently repealed and replaced by Modernizing Ontario’s Municipal Legislation Act, 2017, SO 2017, c.10, sch. 2, s.11. [^18]: North York By-law 30788, s.1.1.35 and 2.2.1. [^19]: Building Code Act, 1992, SO 1992, c.23. [^20]: Act, ss. 34, 38, North York By-law 30788, ss. 2.9.7 – 2.9.9; Toronto Municipal Code, Chapter 694, s.5B.(1); Ontario Building Code, sentence 1.4.1.3 of Division A. [^21]: Sign Permit Application, Ontario Responding Record, tab 1D, p.170. [^22]: MTO had no information that the law firm carried on business at the property and thus referred to the sign as an “illegal billboard” or “third party sign”. [^23]: A copy of the Direction was sent to the City of Toronto Sign By-law Unit. [^24]: We were not provided an explanation of the delay between creation of the inventory in 2008-9 and the Toronto enforcement campaign in 2016. [^25]: R. v. Mohan, 1994 80 (SCC), [1994] 2 SCR 9; R. v. Abbey (2009), 2009 ONCA 624, 97 OR (3d) 330 (CA). [^26]: Baker v. Canada (Minister of Citizenship and Immigration), 1999 699 (SCC), [1999] 2 SCR 817; Pattison Outdoor Advertising LP, 2016 ONSC 2419 (Div. Ct.). [^27]: Pattison Outdoor Advertising LP, 2016 ONSC 2419 (Div. Ct.).