COURT FILE NO.: CV-19-073

DATE: 2022/02/01

COURT OF ONTARIO, SUPERIOR COURT OF JUSTICE

In the matter of the Municipal Conflict of Interest Act, RSO 1990, c. M.50, as amended

RE: TOWN OF LAURENTIAN HILLS, Applicant

BEFORE: Regional Senior Justice Calum MacLeod

COUNSEL: J. Paul R. Cassan, for the Town of Laurentian Hills

David Winfield, Ratepayer, Objector

HEARD: January 25, 2022

DECISION and reasons

Background

[1] Almost exactly two years ago the Town of Laurentian Hills brought an application pursuant to section 7 (2) of the Municipal Conflict of Interest Act.[^1] The reason for the application was that every single member of the municipal council would have had a potential conflict of interest in relation to matters involving the town’s major employer, Canadian Nuclear Laboratories (“CNL”). The Town sought an exemption from the conflict of interest legislation in order to permit the machinery of local government to function.

[2] Mr. Winfield is a ratepayer in the Town of Laurentian Hills and had been the Applicant in a previous proceeding to declare one of the local councillors in a conflict of interest. He was put on notice and had appeared to oppose the requested order.

[3] For reasons released on February 5, 2020, I concluded that a judge is not empowered by the Act to grant a blanket exemption, but it would be reasonable to make an order under s. 7 of the Act in relation to matters that are “sufficiently identified, are presently known and which will trigger declarations of conflict due to potential pecuniary interest”.[^2] I had directed the Town to draw up a list of such matters to be appended to the formal order. It appears that did not occur, and no formal order was taken out.

[4] This matter came before the court a second time on January 25, 2022, by way of a notice of motion with a supporting affidavit. Confusingly, the relief set out in the notice of motion is the relief I have already ruled upon. What the motion should be requesting is for the court to settle the form of the order and if the Town wishes the court to consider the new affidavit, for the court to admit fresh evidence. As I will discuss, it is apparent that the purpose of this hearing is to settle the form of the original order by adding the proposed schedule. I have treated it as such.

[5] Since Mr. Winfield is representing himself and as the procedure for formalizing a court order is not self evident, it requires a brief explanation.

The Significance of Formal Court Orders

[6] After a court hearing the judge may rule immediately or may take the decision under reserve and release a written decision. In either case the decision sets out what relief the court is granting (if any) and the rationale for the decision. The latter includes any findings of fact and how the judge has interpreted or applied the applicable statutory provisions or legal principles. The court’s decision is colloquially referred to as a “judgment”, but it is important to understand that the decision, even if it is in writing, is not itself a court order or a formal judgment.[^3]

[7] A formal court order is a document issued under the seal of the court and recorded in the court record. It is formalized in this manner to ensure it is recognizable as an official court document, is precise as to what the court is requiring or permitting, will be recognized by other courts and levels of government and can be authenticated by reference to the original court file. It can also be replaced by the court if the original is lost or destroyed.

[8] To be clear, this does not mean that the parties are not bound by the judge’s order from the moment the decision is announced. They are. The formal order will bear the date when the decision was released or read out in court. The formalization of the court order, however, is necessary to enforce it or to put others on notice of what the court has decided – or in this case what it has permitted. I had directed that the order be posted on the municipal website.

[9] In civil cases, the procedure for formalizing an order is set out in Rule 59 of the Rules. A court order in a civil proceeding must be “drawn up”, “settled”, “issued” and “entered”. The resulting document is a judgment or order which has been authenticated and formalized.

[10] “Drawn up” means that one of the parties (usually the one seeking the relief) will prepare a draft order containing the operative part of the court’s decision in the format required by the court. “Settled” means that the Registrar is satisfied that the order accurately reflects the terms imposed by the court at the hearing and is in the proper form[^4]. Usually this is accomplished by the parties approving the order “as to form and content” but otherwise it is accomplished through a hearing to settle the form of the order. “Issued” means that the Registrar has signed the original copy (or if it has been signed by a judicial officer has verified the signature) and has sealed the order to indicate that it is an official court document.[^5] “Entered” means that a true copy of the order has been placed in the court file and recorded in the court’s information tracking system.[^6] This process ensures that orders are accurate, authenticated and recorded.

[11] Quite apart from the importance of a system to ensure that formal court orders are recognizable as such and can be verified or authenticated with the court, there is another legal aspect to taking out a court order. It signifies that the adjudication is complete, and the matter has been disposed of. It is the law that the judicial officer is “functus” once the order has been taken out and not before.[^7] What this means is that in appropriate circumstances, a court may reconsider, withdraw, alter or modify a decision before the order has been issued and entered. Once the order is entered, however, the judge loses jurisdiction over the original hearing. At that point, there is a strong presumption of finality and although there are procedures for setting aside, varying or amending a court order, to do so requires a new and separate proceeding and it need not be heard by the same judicial officer who made the original order.[^8]

[12] The point of the above is not to be pedantic about the Rules of Civil Procedure, but to clearly explain the legal situation. The Town did not take steps to prepare a draft order or to have the Schedule to the order approved. The formal order was never drawn up or entered so we are in the situation described above where I remain seized of the original Application and must settle the form of the order. As I will come to however, there is a significant question of whether I should still grant the order I had contemplated after such a long delay and it is not automatic that the new affidavit should be admitted as evidence or given any weight.

[13] The latter point is important for fairness. Mr. Winfield, who was understandably confused about the nature of the hearing, had filed a “supplementary factum” in which he took issue with the proposed schedule. He also took issue with some of the statements made by the mayor in his new affidavit and he attempted to rely on facts that he added to the factum but did not put in an affidavit. This was the subject of an objection by Mr. Cassan although it could have been addressed by an adjournment to swear an affidavit or I could have permitted Mr. Winfield to give his evidence orally. I did not find it necessary to do either, but it shows the danger of reopening a hearing and turning it into a kind of rolling ongoing inquiry.

[14] The Supreme Court of Canada considered this matter in 671122 Ontario Ltd. v. Sagaz Industries Canada Inc. In that decision, the court confirmed that until the judge is functus, the judge has an unfettered discretion to admit fresh evidence and to change, alter, withdraw or amend the original decision but also that this is a power to be used sparingly.[^9]

Analysis

[15] The dilemma I am faced with is twofold. Firstly, since the Town did not prepare a draft order for two years and without it could not have voted on any matter in which CNL had a pecuniary interest, it would appear that the absence of the order did not impede the Municipal Council from performing its role. Although it may partly be explained by the COVID-19 epidemic which has disrupted normal operations, the delay in formalizing the order calls into question the need for such an order in the fist place. After all, the rationale behind it was the suggestion that many different matters might come before Council and it would be impractical to come to court each time. As the record showed, however, the Town had come to court in September of 2019 while this application was pending in order to obtain specific judicial authorization for the renewal of the “tripartite agreement” between Laurentian Hills, Deep River and CNL. Justice James granted that order and it was unopposed by the Respondent or any other ratepayer.

[16] Secondly, the proposed schedule is vague and imprecise. Mr. Winfield opposes it because it contains open ended imprecise language without any certainty that any of the items will come before the Council or that they are matters in which CNL has a pecuniary interest. The draft reads as follows:

SCHEDULE “A”

Laurentian Hills — Schedule to Order of Justice C. MacLeod

1. Emergency matters that require Council action regarding CNL;

2. Mutual Aid Agreement between Laurentian Hills and CNL;

3. Changes to Federal or Provincial Legislation or Regulation that require action by Laurentian Hills;

4. Sponsorship of Community Events by CNL;

5. Donations by CNL to Laurentian Hills;

6. Acquisition or disposition of Land between Laurentian Hills and CNL;

7. Utility Services provided by Laurentian Hills to CNL;

8. Receipt, Approval, Discussion and Direction arising from staff reports regarding CNL;

9. Support for Licence renewals CNL;

10. Support or non-support of CNL projects or initiatives;

11. Laurentian Hills, Deep River Nuclear Preparedness Committee financial agreements meetings, recommendations and reports;

12. Laurentian Hills Fire Department Reports regarding CNL;

13. Payments in Lieu of Taxes from CNL including the allocation and expenditure of those funds and any related requests for reconsideration or assessment appeals that may be filed by CNL to which Laurentian Hills would be a statutory party;

14. Support or presence at CNSC licensing hearings/renewals, especially with Small Modular Reactors;

15. Luncheons / Receptions hosted by CNL;

16. Environmental Remediation Management Stakeholders Relations;

17. Environmental Stewardship Council Meetings;

18. Road maintenance agreement for work performed on municipal roads by CNL

[17] In my decision I discussed precisely what the court could and could not do and the extent to which I was prepared to make an order. In particular, after noting that the purpose of the legislative exemption was to avoid the loss of quorum in circumstances where a decision of a Municipal Council had to proceed, I found that it would only be appropriate to grant the exemption in advance in circumstances where the decision could be identified with sufficient particularity. Otherwise the remedy would be to make the application when the issue arose as had been done with respect to the renewal of the tripartite agreement.

[18] The following paragraphs from the original decision make it abundantly clear what was required.

31 I agree that the legislature did not intend that judges could simply exempt the town from the provisions of the Act because of hypothetical difficulties. It would strain the language of the section to simply grant an exemption so that the issue of conflict need not be considered by the members of council. On the other hand, I agree that the section should be given practical application and it is reasonable to grant an order for recurring issues or issues identified with sufficient precision. The alternative of first placing a matter on the Council agenda, declaring conflicts and then coming to court each time an issue arises is neither desirable nor required.

32 I am prepared to grant an order in relation to specific issues that the council can identify that will come before it and which will inevitably result in declarations of conflict and loss of quorum. For example, the council knows it is in support of the NSDF and will be called upon to renew that support or to take active steps to facilitate the development. The council should also be able to prepare a list of agreements with CNL or involving CNL that will expire and will have to be renewed or renegotiated. Similarly, there are joint committees and working groups which make recommendations or decisions that may have impact on municipal finances and will have to be approved. Providing these can be specifically identified and listed in a schedule to the formal order, it will be appropriate to provide the requested exemption without returning to court on each separate occasion.

33 On the other hand, I cannot simply grant an exemption for all matters involving CNL. Any matters that are only hypothetical or currently unidentified cannot possibly come within the definition of authority to "discuss and vote on the matter out of which the interest arises." When and if such matters are identified and it appears all members of the council are disqualified, an application may be made. While it is certainly within the discretion of the judge hearing the matter to require notice, as was done in this case, the statute specifically provides that the application may be brought without notice.

[19] The proposed schedule appears to be exactly what I determined I could not do. The fact that an issue may come before the Council and may involve a pecuniary interest of CNL is insufficient because without details I cannot assess whether the pecuniary interest is significant, and any conflict of interest can safely be ignored.

[20] The next question is whether I should admit the January 7 affidavit and whether if I do so, Mr. Winfield is in any way prejudiced. If the affidavit contained specifics of agreements that are expiring or matters that are on the agenda for specific meetings of the Council, it might be of assistance. It might be appropriate to consider evidence that either was not available at the time of the original hearing or which specifically addressed the question raised in paragraph 35 of my decision. This affidavit does neither.

[21] Mr. Reinwald deposes, for example, that there is a mutual aid agreement and a Nuclear Preparedness Committee and then states that “Council would need to deal with any emergency that might arise” and seeks the court’s authorization to do so. Left unexplained is the nature of any kind of emergency that would require the Council of the municipality as opposed to the Mayor himself or a designated municipal official to take action or to any situation where in the middle of an emergency the Council would have to vote on a matter that would involve a pecuniary interest of CNL.

[22] The mayor also deposes that the mutual aid agreement which exists between the Town and CNL and their respective fire departments exists. This was before me at the original hearing and was an example of a matter that might come before Council. In the new affidavit, the mayor deposes that “Council needs to be able to negotiate and renew this agreement. I am not told when the existing agreement expires or what role Council plays but because this is specifically referred to in the original decision and there were sufficient particulars in the original affidavit for me to determine that an exemption for this purpose is appropriate. It can be included in the order. I am not assisted by the new affidavit.

[23] Other examples in the affidavit are the fire department budget, payments in lieu of taxes and the possibility of a land swap with CNL. Lacking is any specific detail about when these matters would come before this Council for a vote or any explanation of how matters such as the Fire Department budget or payments in lieu of taxes have been considered during 2020 and 2021 after the hearing but before the order was finalized.

[24] For these reasons I am not relying on the new affidavit or re-opening the hearing. If I did reopen the hearing I would have to seriously reconsider if the order I made was appropriate at all. The evidence now is that during the entire term of this Council, there has only been one matter that required specific court approval and when that application was brought it was dealt with promptly.

Disposition

[25] I have signed the draft order with a more limited and specific list of exemptions based on the evidence provided at the original hearing. The new schedule reads as follows:

SCHEDULE “A”

Laurentian Hills — Schedule to Order of Justice C. MacLeod

1. Renewal of the Mutual Aid Agreement between Laurentian Hills and CNL;

2. Renewal of agreements for provision of Utility Services provided by Laurentian Hills to CNL;

3. Participation on the Laurentian Hills, Deep River Nuclear Preparedness Committee and consideration of financial agreements, meetings, recommendations and reports;

4. Renewal of Road maintenance agreement for work performed on municipal roads by CNL

5. Acceptance of sponsorships or gifts proposed by CNL for municipal parks or recreation facilities.

[26] Nothing in this order prevents another application for a specific exemption if any of the hypothetical conflicts identified by the mayor should arise. In addition, of course, since the order was only sought for the life of this Council, it will expire on the date of the next municipal election.

[27] There will be no costs of this hearing.

Mr. Justice C. MacLeod

Date: February 1, 2022

COURT FILE NO.: CV-19-073

DATE: 2022/02/01

ONTARIO

SUPERIOR COURT OF JUSTICE

In the matter of the Municipal Conflict of Interest Act, RSO 1990, c. M.50, as amended

RE: TOWN OF LAURENTIAN HILLS, Applicant

BEFORE: Regional Senior Justice Calum MacLeod

COUNSEL: J. Paul R. Cassan, for the Town of Laurentian Hills

David Winfield, Ratepayer, Objector

decision and reasons

Regional Senior Justice Calum MacLeod

Released: February 1, 2022

[^1]: RSO 1990, c. M.50, as amended. Hereinafter “the Act” [^2]: See 2020 ONSC 794 in particular para.35 [^3]: A judgment is one type of court order. [^4]: Rule 59.04 (5) – (9) [^5]: Rule 59.04 (1) & (2) [^6]: Rule 59.05 [^7]: See for example, Roopchand v. Chau, 2013 ONSC 2119 [^8]: See Rule 59.06 for the circumstances in which a motion to set aside, vary or suspend an order or judgment may be appropriate. [^9]: 2001 SCC 59, [2001] 2 SCR 983 citing with approval Scott v. Cook, 1970 331 (ON SC), [1970] 2 OR 769, 12 DLR (3d) 113 (HCJ)