COURT FILE NO.: CV-17-585118
DATE: 20180516
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
9616837 CANADA LTD.
Applicant
– and –
THE CORPORATION OF THE TOWN OF WASAGA BEACH
Respondent
Stephen J. D’Agostino and Denitza Koev, for the Applicant
Jody E. Johnson, for the Respondent
HEARD: April 4, 2018
JUSTICE S. NAKATSURU
[1] The applicant is a company that owns property in downtown Wasaga Beach. The Town of Wasaga Beach (the “Town”), the respondent, wants to redevelop the downtown area. Their aim is to make it a vibrant, social, cultural and economic heart of the community. They want to expropriate the applicant’s land to do it. However, their plans are still at a preliminary stage. The Town has not yet changed their official plan to permit this redevelopment. Despite this, the Town passed a by-law to commence proceedings that would allow it to expropriate the applicant’s property at 140 Main Street. The applicant brings this application to quash this by-law.
A. SUMMARY OF THE FACTS
[2] The material facts can be stated briefly. The Town of Wasaga Beach is located within the County of Simcoe. In June 2016, the Town commenced a planning process for the establishment of a new downtown which led to the development of the Downtown Development Master Plan (“DDMP”). This process involved stakeholder meetings and community engagement. The DDMP provides a vision for the redevelopment of the downtown area. On March 28, 2017, the Town Council adopted the DDMP. The DDMP is not in conformity with the existing official plan for the area, including the Official Plan Amendment No. 42. As a result, Town Council directed that the staff update the Town’s official plan according to the framework provided by the DDMP.
[3] The applicant owns the subject property adjacent to some municipally owned property. On September 26, 2017, counsel for the Town sent a staff report to Wasaga Beach Town Council seeking authorization for approval to expropriate the applicant’s land. The reason for the expropriation was so that the Town could implement the DDMP and the related public infrastructure work. On that day, Wasaga Beach Town Council enacted By-law 2017-82 under ss. 4 and 6 of the Expropriations Act authorizing an application for approval to expropriate the applicant’s property and giving them notice.
B. POSITION OF THE PARTIES
[4] The applicant moves to quash By-law 2017-82 under s. 273(1) of the Municipal Act, 2001, R.S.O. 2001, c. 25, s. 273, as it contravenes s. 24(1) of the Planning Act, R.S.O. 1990, c. P.13. While the Town can expropriate property for municipal purposes, the applicant argues that the respondent’s purpose for expropriation is to implement the DDMP and its associated works. Section 24 of the Planning Act requires that no public work can be undertaken or by-law passed that is not in conformity with the official plan. Thus, Wasaga Beach Town Council was not entitled to pass By-law 2017-82 because it was not in conformity with the official plan as it existed at the time the by-law was passed. Even now, the required amendments to the official plan have not been put into force.
[5] The respondent does not take issue with the fact that By-law 2017-82 was passed to implement the DDMP and the official plan needs to be amended. The Town is in the process of doing this, but the process is not yet complete. However, the respondent submits that the by-Law only triggers the expropriation process and is therefore permitted pursuant to s. 24(3) of the Planning Act. Section 24(3) allows a municipality to consider undertaking a public work that does not conform to the official plan and to seek approvals, carry out investigations, obtain reports or take other preliminary steps necessary for the undertaking of the work. The Town argues that this includes passing By-law 2017-82, which only seeks approval and provides notice of expropriation.
[6] The applicant replies that s. 24(3) does not include an authority to pass by-laws.
C. ANALYSIS
[7] This application comes down to a question of the statutory interpretation of s. 24(3) of the Planning Act. It is useful to set out the provisions of the relevant legislation.
[8] On its face, By-law 2017-82 was enacted under ss. 4 and 6 of the Expropriations Act, R.S.O. 1990, c. E. 26. These sections require the approval of the approving authority and notice of intention to expropriate be given to the registered owner of the lands to be expropriated and to the public before expropriation. A municipality’s power to acquire land must be done in accordance with the provisions of the Expropriations Act: see s. 6(1) of the Municipal Act.
[9] Of course, the most important statute under consideration is the Planning Act. The purposes of that Act are set out as follows:
1.1 The purposes of this Act are,
(a) to promote sustainable economic development in a healthy natural environment within the policy and by the means provided under this Act;
(b) to provide for a land use planning system led by provincial policy;
(c) to integrate matters of provincial interest in provincial and municipal planning decisions;
(d) to provide for planning processes that are fair by making them open, accessible, timely and efficient;
(e) to encourage co-operation and co-ordination among various interests;
(f) to recognize the decision-making authority and accountability of municipal councils in planning.
[10] It is useful to set out section 24 of the Planning Act in full with emphasis placed on s. 24(3):
Public works and by-laws to conform with plan
24 (1) Despite any other general or special Act, where an official plan is in effect, no public work shall be undertaken and, except as provided in subsections (2) and (4), no by-law shall be passed for any purpose that does not conform therewith.
Pending amendments
(2) If a council or a planning board has adopted an amendment to an official plan, the council of any municipality or the planning board of any planning area to which the plan or any part of the plan applies may, before the amendment to the official plan comes into effect, pass a by-law that does not conform with the official plan but will conform with it if the amendment comes into effect.
Same
(2.1) A by-law referred to in subsection (2),
(a) shall be conclusively deemed to have conformed with the official plan on and after the day the by-law was passed, if the amendment to the official plan comes into effect; and
(b) is of no force and effect, if the amendment to the official plan does not come into effect.
Preliminary steps that may be taken where proposed public work would not conform with official plan
(3) Despite subsections (1) and (2), the council of a municipality may take into consideration the undertaking of a public work that does not conform with the official plan and for that purpose the council may apply for any approval that may be required for the work, carry out any investigations, obtain any reports or take other preliminary steps incidental to and reasonably necessary for the undertaking of the work, but nothing in this subsection authorizes the actual undertaking of any public work that does not conform with an official plan. [Emphasis added.]
Deemed conformity
(4) If a by-law is passed under section 34 by the council of a municipality or a planning board in a planning area in which an official plan is in effect and, within the time limited for appeal no appeal is taken or an appeal is taken and the appeal is withdrawn or dismissed or the by-law is amended by the Tribunal or as directed by the Tribunal, the by-law shall be conclusively deemed to be in conformity with the official plan, except, if the by-law is passed in the circumstances mentioned in subsection (2), the by-law shall be conclusively deemed to be in conformity with the official plan on and after the day the by-law was passed, if the amendment to the official plan comes into effect.
[11] I agree with the applicant that s. 24(3) does not specifically refer to the ability of a council of a municipality to pass a by-law to accomplish the purposes found within. From this, the applicant argues that the plain and ordinary meaning that should be given to the subsection is that it only permits the municipality to undertake matters pertaining to public works that do not require a by-law to be enacted.
[12] I do not agree.
[13] When it comes to statutory interpretation, the starting point is Driedger’s definitive formulation which states:
Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.
[14] This approach has been repeatedly cited by the Supreme Court of Canada as the approach to statutory interpretation across a wide range of interpretive settings: see, for example, Stubart Investments Ltd. v. The Queen, 1984 CanLII 20 (SCC), [1984] 1 S.C.R. 536, at p. 578, per Estey J.; Québec (Communauté urbaine) v. Corp. Notre-Dame de Bon-Secours, 1994 CanLII 58 (SCC), [1994] 3 S.C.R. 3, at p. 17; Rizzo & Rizzo Shoes Ltd. (Re), 1998 CanLII 837 (SCC), [1998] 1 S.C.R. 27, at para. 21; R. v. Gladue, 1999 CanLII 679 (SCC), [1999] 1 S.C.R. 688, at para. 25; R. v. Araujo, 2000 SCC 65, [2000] 2 S.C.R. 992, at para. 26; R. v. Sharpe, 2001 SCC 2, [2001] 1 S.C.R. 45, at para. 33, per McLachlin C.J.; Chieu v. Canada (Minister of Citizenship and Immigration), 2002 SCC 3, [2002] 1 S.C.R. 84, at para. 27.
[15] Before delving more deeply into the interpretation of s. 24(3), I will note the specific context of the exercise of the powers by the Town in this case. That context is that the Town intends to take the applicant’s land. The nature of that power has been described in this way by the Supreme Court of Canada in Dell Holdings Ltd. v. Toronto Area Transit Operating Authority, 1997 CanLII 400 (SCC), [1997] 1 S.C.R. 32 , at para. 20:
The expropriation of property is one of the ultimate exercises of governmental authority. To take all or part of a person's property constitutes a severe loss and a very significant interference with a citizen's private property rights. It follows that the power of an expropriating authority should be strictly construed in favour of those whose rights have been affected.
[16] As a general proposition under s. 24(1), all municipal by-laws must conform with the official plan. This makes good planning sense since the official plan is a document that sets out the goals, objectives and policies of the municipality with respect to the development of lands in the municipality: Richmond Hill (Town) v. Elginbay Corp., 2016 ONSC 5560, 133 O.R. (3d) 686, at para. 7. Before the enactment of s. 24(3), by-laws that did not conform with the official plan in circumstances similar to the case at bar were quashed by the courts as illegal: Holmes v. Halton (Regional Municipality) (1978), 1978 CanLII 1387 (ON SC), 19 O.R. (2d) 468 (H.C.J.).
[17] That being acknowledged, s. 24 was amended after the decision in Holmes to include s. 24(3). The purpose for enacting s. 24(3) was to permit the municipality to take preliminary steps such as applying for approvals and carrying out investigations that do not conform with the official plan. Laying the groundwork for municipal public works and changes to the official plan takes time to complete. The section permits the municipality to take preliminary steps while also moving forward to change the official plan. This is both efficient and good planning policy. However, the section also ensures that no public work is actually undertaken until the official plan is amended.
[18] Given that purpose, s. 24(3) must be interpreted to give the municipality the authority to take these preliminary steps by enacting by-laws. A municipality is a creature of statute. The municipality through its council, unless it is specifically authorized to do otherwise, must exercise its powers by by-law: Municipal Act, s. 5. It is unreasonably restrictive to interpret s. 24(3) in a manner that only permits a municipal council to exercise its power to prepare for a public work where it can do so without resorting to its by-law power. It would effectively denude a municipality’s ability to achieve the legislative purpose behind s. 24(3). In my opinion, what is important in considering whether the actions of a municipality falls within the scope of s. 24(3) is looking at the substance of the actions, not the form by which it takes place.
[19] My conclusion is supported by consideration of the scheme of s. 24. The various subsections must be looked at as a whole and read harmoniously. Section 24(3) states “(d)espite subsections (1) and (2), council is permitted to consider the undertaking of a public work that does not conform with the official plan and for that purpose conduct certain preliminary matters.” Subsection (1) prohibits both the undertaking of a public work and the passing of a by-law that does not conform with the official plan except a by-law can be passed under subsections (2) and (4). Subsection (4) also has no applicability to the case at bar as it deals with zoning by-laws and a deeming provision as to when they take effect. More relevant for my purposes is subsection 2. Subsection (2) deals with a by-law passed where a council or a planning board has adopted an amendment to an official plan but where that amendment has not yet come into effect. I agree with the applicant’s explanation for the reasons behind such a provision. In some instances, ministerial approval or where appeals are taken, the amendment to the official plan may not yet be in effect although adopted by council or a planning board. In such circumstances, the municipality or a planning board may gamble that the amendment will be effective at a later date and pass a by-law even though it does not yet conform with the existing official plan. In the case at bar, this exception is not applicable since Wasaga Beach Town Council has yet to adopt any official plan amendment.
[20] Thus, on its face, the reach of s. 24(3) exempts itself from subsections (1) and (2) but not subsection (4). In other words, zoning bylaws do not fall within the ambit of s. 24(3). The question arises, why would the legislature have included subsection (2) within the terms of s. 24(3) and what impact does that have on the question of whether s. 24(3) itself includes a power to pass by-laws? In my opinion, when all the provisions of s. 24 are read harmoniously with the purpose of the legislation in mind, the reference to subsection (2) in s. 24(3) is meant to catch a situation like the case at bar. Here the Town cannot avail itself of the power to pass by-laws under subsection (2) because it has yet to adopt an amendment to the official plan. Yet, the Town still wishes to undertake the preliminary steps incidental and necessary for the undertaking of the work. As a result, s. 24(3) exempts the application of subsection (2) when by-laws deal with such preliminary matters. The other implication of the inclusion of subsection (2) is that it clearly shows the legislature’s intent to have by-laws included within the powers that can be wielded by the Town in subsection (3). Otherwise, there would be no necessity to refer to subsection (2) which only deals with the ability of the municipality or planning board to pass a by-law.
[21] In my view, a proper contextual interpretation to s. 24(3) supports the respondent’s position. To permit a municipality to pass by-laws in order to undertake the preliminary work for a public work is not reading in or adding to what the legislator said in s. 24(3), but is to give effect to what the legislator did say: Metropolitan Toronto Condominium Corp. 626 v. Bloor/Avenue Road Investment Inc., (2009), 64 M.P.L.R. (4th) 45 (Ont. S.C.J.), at paras. 39-40.
[22] By-law 2017-82 is the first step in the expropriation process: Expropriations Act ss. 4-10. “Public work” is defined in s. 1 of the Planning Act as “any improvement of a structural nature or other undertaking that is within the jurisdiction of the council of a municipality or a local board.” It is uncontested that the DDMP falls within that definition. In applying for approval to expropriate the applicant’s lands, the Town is making an application for an approval that is required for the DDMP. This falls within s. 24(3). The Town is further giving notice to the applicant to expropriate his land as a preliminary step incidental to and reasonably necessary for the undertaking of the DDMP. This too falls within s. 24(3). As a result, By-law 2017-82 is a valid exercise of the Town’s authority.
[23] I have one final observation. In oral argument, the respondent submitted that s. 24(3) would authorize the Town of Wasaga Beach to pass a by-law that would actually expropriate the applicant’s property. While this issue is not before me and would be premature to decide, in my view, such a position has a very tenuous footing in s. 24(3). Actual expropriation could hardly be said to be “a preliminary step incidental to” the undertaking of the public work. It would be contrary to the overall purpose of s. 24, which is to ensure that DDMP conforms with the official plan, and to permit affected parties to take full advantage of the regulatory process to have their concerns heard and taken into consideration. It would not adequately recognize the “severe loss and a very significant interference with a citizen's private property rights” emphasized in Dell Holdings. Finally, it would be contrary to the purposes and spirit of the Planning Act.
[24] On the matter of costs. If the parties cannot agree on the subject of costs, brief written submissions no greater than three pages may be delivered on behalf of the respondent within 20 days of today’s date and on behalf of the applicant of the same length within 15 days thereafter.
Justice S. Nakatsuru
Released: May 16, 2018
COURT FILE NO.: CV-17-585118
DATE: 20180516
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
9616837 CANADA LTD.
Applicant
– and –
THE CORPORATION OF THE TOWN OF WASAGA BEACH
Respondent
REASONS FOR JUDGMENT
NAKATSURU J.
Released: May 16, 2018