COURT FILE NO.: CV-13-687 (Guelph) DATE: 20240122
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
LOU MAIERON K. Sherkin & M. Walwyn, for the Plaintiff Plaintiff
- and -
UGO GUILA, NADESE GENERAL CONTRACTING INC., SECURITY RECYCLING (ONTARIO) LIMITED, TICAL PAINTING & DECORATING LIMITED, VICMARELLE HOLDINGS LIMITED, BIRDSEYE FARM LIMITED, THE CORPORATION OF THE TOWN OF ERIN and CREDIT VALLEY CONSERVATION AUTHORITY
F. Miceli, for the Defendants, Ugo Guila, Nadese General Contracting Inc., Security Recycling (Ontario) Limited, Tical Painting & Decorating Limited, Vicmarelle Holdings Limited, and Birdseye Farm Limited S. Hamilton, for the Defendant, The Corporation of the Town of Erin
Defendants
HEARD: November 21, 22, 23, and 24, 2023
REASONS FOR JUDGMENT Justice G.D. Lemon
The Issue
[1] Mr. Maieron, the plaintiff, has sued the defendants because he alleges that they have registered an improper easement on his land.
[2] Mr. Gulia, the defendant, is a principal of the corporate defendants other than Credit Valley Conservation Authority and the Town of Erin. Mr. Gulia’s last name is spelled incorrectly in the title of proceedings, but no issue was raised with respect to that error. I shall refer to those defendants as Mr. Gulia.
[3] The defendant, Credit Valley Conservation Authority, was let out of the action in advance of the trial.
[4] Accordingly, I shall refer to the parties as Mr. Maieron, Mr. Gulia, and the Town of Erin or Erin.
The Background
[5] There are very few facts in issue and a detailed Agreed Statement of Facts was filed as an exhibit. On consent, the parties provided their evidence by affidavit followed by brief cross-examination.
[6] Mr. Maieron owns and operates Silver Creek Fish Hatchery and Pond Supply in Erin. He also owns the lands on which Silver Creek operates. The property at issue in this action is adjacent to Mr. Maieron’s property.
[7] Mr. Gulia and his related companies planned to develop other lands adjacent to Mr. Maieron’s property. The Town of Erin had the necessary oversight on the approval process to allow Mr. Gulia to proceed with his plans to develop his lands.
[8] In 1997, Mr. Gulia brought an application before the Ontario Municipal Board seeking various adjustments and accommodations with respect to developing his lands into a residential housing subdivision. Mr. Maieron objected to that application because he had serious concerns as to how the water supply and drainage from the proposed subdivision would affect his farm. He was a participant before the OMB regarding the property.
[9] In or about September 1997, during the OMB hearing, Mr. Maieron and Mr. Gulia entered into a settlement agreement such that a parcel of Mr. Gulia’s land would be transferred to Mr. Maieron. That is now known as Block 56. Mr. Maieron was to receive $35,000 along with that land. That agreement also provided that Block 56 would be transferred to Mr. Maieron subject to “easements to permit the developers (Gulia, Leenders, Campbell), The Township, and public agencies to carry out the monitoring programme as detailed in condition 15(c).”
[10] Condition 15 (c) required:
That the Subdivision Agreement between the owners and the Township of Erin contain provisions in wording acceptable to the Credit Valley Conservation and to the Ministry of the Environment and Energy and to the Township of Erin for:
c) the submission of a monitoring program to assess the impacts of both the septic systems and stormwater management facilities to the satisfaction of the Ministry of Environment and Energy. The monitoring program must address contingency provisions that will be implemented in the event that the parameters set by the program are exceeded. The monitoring program and contingency provisions shall also include provisions designed to ensure the protection of fish habitat and to ensure the protection of the adjacent aquaculture operation on Lots 12 and 13, Concession 9.
The monitoring program shall be substantially in the form attached hereto and file as Exhibit No. 145 at the Ontario Municipal Board.
[11] Although Mr. Maieron denied any knowledge of Paragraph 15 (c), there is no dispute that it reads as set out above. Exhibit 145 was the agreement between Mr. Gulia and Mr. Maieron as set out above.
[12] The agreement between Mr. Gulia and Mr. Maieron also required that, before the deed to Lot 56 would be transferred to Mr. Maieron, he was to prepare “a woodlot management plan, including showing a buffer strip and which plan may include a pagewire fence if agreeable, to the satisfaction of the developers and MNR. . .”
[13] The deed to the land was to be held by the Town of Erin while Mr. Maieron obtained that approval, but once the woodlot management plan was approved, the deed “in registerable form” was to be released to him.
[14] While that process was under way, in or around 2003, Mr. Gulia and the Town of Erin entered into a Subdivision Agreement. The Subdivision Agreement granted the Town of Erin and the Credit Valley Conservation Authority an expanded, permanent, easement over the lands in issue (including Block 56) to access the storm water management system for Mr. Gulia’s subdivision. Of significance to this dispute, that easement permitted the construction of new storm water management systems on the property.
[15] That subdivision agreement provided the following easement to both the Town of Erin and the Credit Valley Conservation Authority:
a right in the nature of an easement or licence to enter upon the said lands at all reasonable hours to construct, complete, rectify and maintain all drainage works and stormwater management systems and to further carry out the water monitoring program, as more particularly set out in the Subdivision Agreement registered as Instrument Number WC27563.
[16] Mr. Maieron was not a party to that Subdivision Agreement.
[17] In or around 2005, Mr. Maieron provided the Town of Erin with a copy of the Ministry of Natural Resources’ approval of his woodlot management plan for Block 56 in order to obtain the transfer of Block 56.
[18] When Mr. Maieron went to the offices to pick up the deed, he was told that the Town of Erin did not have it, as Mr. Gulia’s lawyers were “working on it”. This was contrary to the terms of the settlement agreement in that Erin was to hold the draft deed in trust until the conditions in the agreement were met.
[19] Following this, the Town of Erin advised Mr. Maieron that the deed was available for pick-up and registration. When Mr. Maieron picked up the deed, he noticed that it contained the following easement:
Reserving onto the Transferors, their successors, assigns, servants and agents, a right in the nature of an easement or licence to enter upon the said lands at all reasonable hours to construct, complete , rectify and maintain all drainage works and stormwater management systems and to further carry out the water monitoring program, as more particularly set out in the Subdivision Agreement registered as Instrument Number WC27563.
[20] The issue for this proceeding is that Mr. Maieron objects to the term that allows for the entry to “construct, complete, rectify and maintain all drainage works and stormwater management systems.” Instead, he submits that the easement should only be for the purposes of a water monitoring program that he agreed to with Mr. Gulia.
[21] Mr. Maieron says that he was astonished that this term was in the deed, as it was not part of the terms of his agreement with Mr. Gulia, which only allowed for a monitoring program. Mr. Maieron took steps to correct the deed to reflect the exact wording of the terms in his agreement but was unsuccessful.
[22] Since the terms on the deed were not in accordance with what was agreed, Mr. Maieron did not register the deed; he was concerned that he would not be able to ask for the change after the registration.
[23] In 2010, pursuant to its easement, the Town of Erin carried out remedial works on the stormwater management facilities located on the property. Erin says that these works were necessary to bring existing facilities into compliance with the Certificate of Approval for Municipal and Private Sewage Works, as required by the Ministry of the Environment. Erin submits that the works performed were within the rights of its easement and the subdivision agreement.
[24] In 2010, Mr. Maieron discovered the newly installed underground drainage equipment beneath the property. He submits that he was not prepared to take on the responsibility or liability for this, and there was never any right for the Town of Erin to do this work in his agreement with Mr. Gulia.
[25] In 2012, Mr. Maieron received a tax certificate from the Town of Erin indicating that the property taxes in the amount of $38,586.34 were owed for lot 56. The deed was still not registered to him, but Mr. Maieron paid the taxes due to a concern that the lands would be sold for tax arrears. Since then, Mr. Maieron has paid a further $8,062.65 in taxes. He seeks the return of that money: a total of $46,648.99.
Amendment of Claim
[26] At the outset of the trial, Mr. Maieron sought to amend his claim. After argument, I dismissed his request for reasons to follow. These are those reasons.
[27] I heard arguments on the issue and then continued with the trial with the amendment request reserved. A short time was fixed for the trial and any further adjournment to consider the issue would have delayed the trial. If I had allowed the amendment at the end of trial, a new trial would likely have been required and time wasted. However, if I had adjourned for any further time to consider the issue, time would also have been wasted. If, at the end of the evidence, the amendment was not granted, time would have been well used. I opted to continue and deal with all issues at once after hearing the evidence and any further argument on the amendment issue. I also had the benefit of hearing the trial evidence to assist me in determining whether there was real prejudice to the defendants in allowing the amendment.
[28] At the outset, the Statement of Claim included the Claim that Mr. Maieron wanted:
b. An order compelling the transfer of property as described in Schedule ‘A” herein from the Defendants other than the Town of Erin to the Plaintiff for the sum of $2.00 without the additional restrictions and easement set out in page 3 of the Schedule to the Deed or alternatively an order that the Plaintiff is the owner of the said lands described therein;
[29] At trial, Mr. Maieron asked to amend subparagraph b to read:
b. An order compelling the transfer of property as described in Schedule ‘A” herein from the Defendants other than the Town of Erin to the Plaintiff for the sum of $2.00 without the additional restrictions and easement set out in page 3 of the Schedule to the Deed and an order that the Plaintiff is the owner of the said lands with the easement in favour of the Town of Erin as set out in the settlement agreement ;
[30] The amended pleading would have the effect of removing the present easement for stormwater management systems and replacing it with the water monitoring easement to which he had agreed.
Authorities
[31] The Rules of Civil Procedure, R.R.O. 1990, Reg. 194, authorize the following:
26.01 On motion at any stage of an action the court shall grant leave to amend a pleading on such terms as are just unless prejudice would result that could not be compensated for by costs or an adjournment.
26.02 A party may amend the party’s pleading,
(a) without leave, before the close of pleadings, if the amendment does not include or necessitate the addition, deletion or substitution of a party to the action;
(b) on filing the consent of all parties and, where a person is to be added or substituted as a party, the person’s consent; or
(c) with leave of the court.
[32] In 158844 Ontario Ltd. v. State Farm Fire and Casualty Co, 2017 ONCA 42, Hourigan J.A. said, at para 25:
The law regarding leave to amend motions is well developed and the general principles may be summarized as follows:
-- The rule requires the court to grant leave to amend unless the responding party would suffer non-compensable prejudice; the amended pleadings are scandalous, frivolous, vexatious or an abuse of the court's process; or the pleading discloses no reasonable cause of action.
-- The amendment may be permitted at any stage of the action.
-- There must be a causal connection between the non-compensable prejudice and the amendment. In other words, the prejudice must flow from the amendments and not from some other source.
-- The non-compensable prejudice may be actual prejudice, i.e ., evidence that the responding party has lost an opportunity in the litigation that cannot be compensated as a consequence of the amendment. Where such prejudice is alleged, specific details must be provided.
-- Non-compensable prejudice does not include prejudice resulting from the potential success of the plea or the fact that the amended plea may increase the length or complexity of the trial.
-- At some point, the delay in seeking an amendment will be so lengthy, and the justification so inadequate, that prejudice to the responding party will be presumed.
-- The onus to prove actual prejudice lies with the responding party.
-- The onus to rebut presumed prejudice lies with the moving party. [Citations removed ].(Emphasis in Original)
Analysis
[33] In paragraph 8 of the Claim, Mr. Maieron pleads that:
[T]he Plaintiff seeks recovery of the said funds paid in 2012 and seeks an Order requiring a registerable Deed in respect to the Lands described in Schedule “A” without the easement or a declaration that the plaintiff owns the said lands without restrictions.
[34] Mr. Maieron submits that combined with paragraph one, the Town of Erin has notice of the claim, it has not changed, and that the amendment is just a “tweaking” of the Claim. I disagree.
[35] This trial was the topic of a consent order dated October 15, 2021. McSweeney J. endorsed, inter alia :
In this unusual case, the parties waive discoveries and wish to proceed to a short trial. The plaintiff’s action was previously dismissed for delay, but he has filed a trial record and now advises that nothing further is required prior to trial.
[36] Her Honour then set out an agreed upon timetable for filings and the times for trial. She ordered that there were to be “no motions before trial other [sic] without leave of the court. . .”
[37] As can be seen, the original claim asked for no relief against the Town of Erin except damages. It requested the transfer of property from the Defendants “other than the Town of Erin.”
[38] The original claim against Mr. Gulia focusses on the 1997 agreement between him and Mr. Maieron. There is no mention of the arrangements leading up to the 2003 easement registered by the Town of Erin and Mr. Gulia. However, the new claim seeks to take away the easement that the Town of Erin already has on the land.
[39] The Town of Erin came to court to defend against a damage claim with the belief that, whatever the outcome between Mr. Maireron and Mr. Gulia, Erin’s easement would remain on the land.
[40] The Credit Valley Conservation Authority presently has an easement in the same terms at Erin’s. Since it has been let out of the action, the CVCA is not aware of a potential conflict between its easement and that which is requested in the claim. Even if the amendment were granted on the terms now requested, the CVCA easement in the terms Mr. Maieron finds objectionable would still be on property; the claim would be an academic exercise for Mr. Maieron’s purposes.
[41] In effect, Mr. Maieron’s amended claim now seeks to set aside Erin’s 2003 easement more than twenty years after its registration without notice to all other interested parties. That is a fundamentally different claim than first pleaded. See: Monster Snacks v. David, 2023 ONSC 6223. That claim is out of date. An application that is stale dated by the operation of the Limitations Act, 2002, S.O. 2002, c. 24, is prejudicial to the defence.
[42] It is important to highlight that Mr. Maieron’s claim had been dismissed for delay. In 2021, he confirmed to McSweeney J. that he was ready for trial. He has not been rushed in his preparation and has had ample time to think out his claim in detail. On that basis, the Town of Erin agreed to the unusual process and evidence for the trial. It says that it would have defended its claim in a different fashion if the claim were as proposed in this motion.
[43] In his motion materials, Mr. Maieron provides no explanation as to why the claim is only now being amended. In evidence, he said that he had not seen the 2003 registered easement even though that is the easement that he has objected to throughout. I agree with Erin that in this case, the delay in seeking an amendment is so lengthy, and the justification so inadequate, that prejudice to the Town can be presumed. Mr Maieron has not provided any explanation for the exceptional delay.
[44] Accordingly, I did not grant leave for Mr. Maieron to amend his claim. For reasons set out below, even if I had granted the amendment, the claim would still have been dismissed.
Position of the Plaintiff
[45] Mr. Maieron submits that the principal issues in this case are:
i. Should the Defendants be required to deliver the Deed to the Plaintiff without the Easement?
ii. Should the Defendants be required to reimburse the Plaintiff for the taxes paid in the amount of $46, 648.99?
iii. Should the Plaintiff have the right to remove any installations that were made on the Property from the time of the OMB Settlement Agreement to date without his consent?
[46] Mr. Maieron says that this is a straightforward case wherein the parties came to a settlement agreement stating that a piece of property would be transferred to him in accordance with certain terms, and the defendants are now attempting to add an additional term to the deed that was not part of the deal.
[47] In 1997, the parties reached a settlement agreement with respect to the property, granting Mr. Maieron a deed to the property in accordance with the terms in the OMB Settlement Agreement. He says that other easement terms should not be included or implied as included into that agreement.
[48] In 2003, the defendants, without any involvement by Mr. Maieron, entered into an agreement granting the Town of Erin an expanded, permanent, easement over the lands to access the storm water management system for Mr. Gulia’s subdivision and permitting the construction of new storm water management systems on the property.
[49] Mr. Maieron says that he agreed to a short-lived monitoring program but not to an easement that allowed for the construction and maintenance of underground drainage equipment.
[50] In presenting Mr. Maieron with the deed containing the new terms of easement, Mr. Maieron says that the defendants are trying to rewrite the contract to reflect changing circumstances. If Erin wanted to retain such an easement over the property, it should have negotiated for it during the discussions before the OMB. The Defendants are sophisticated parties and should not be allowed to re-write the terms of the settlement agreement after the fact.
[51] Furthermore, although Mr. Maieron has paid realty taxes in the amount of $46,648.99, the deed was not registered, and he only did so because he was concerned that the lands would be sold. Despite paying the property taxes, he has not obtained the use and enjoyment of the property. He asks that he be reimbursed for the property taxes that he has paid.
[52] Finally, after his agreement with Mr. Gulia, Mr. Maieron discovered that Mr. Gulia had installed underground drainage equipment beneath the property. Since he is not prepared to take on the responsibility or liability for this, he requests the right to remove the equipment installed beneath the property.
Analysis
[53] Mr. Maieron seeks judgment on terms that:
- The Defendants shall provide to the Plaintiff the deed to the Property in question in this action in accordance with terms of the OMB Settlement Agreement and without the Easement.
- The Defendants shall reimburse the Plaintiff for the amount of taxes that he paid in the amount of $46,648.99.
- The Plaintiff be granted the right to remove any installations that were made on the Property from the time of the OMB Settlement Agreement to date without his consent.
[54] In my view, Mr. Maieron is not entitled to judgment on any of those requests.
[55] There is no dispute with respect to the terms of the agreement between Mr. Maieron and Mr. Gulia. On a balance of probabilities, I find that the Town of Erin would have known of that agreement. Representatives of Erin were in attendance at the hearing, the terms of the agreement were an exhibit to those proceedings, and the agreement was included in the final decision. The Town of Erin was to be the trustee of the deed.
[56] However, the Town of Erin was not a party to that agreement. Mr. Maieron says that the town did not “live up to the agreement,” but there was no agreement between Mr. Maieron and the Town of Erin. The evidence is that the only individuals involved in the negotiations and preparations of the agreement were Mr. Maieron, Mr. Gulia’s lawyer, and the OMB chair. Further, the subdivision agreement was placed on Block 56 before title was passed from Mr. Gulia to Mr. Maieron.
[57] Mr. Maieron denies that he knew the terms of the subdivision agreement and the decision of the OMB that included all those terms. That is difficult to believe but, even so, I cannot find an obligation on the town to protect Mr. Maieron’s interests particularly when he was not on title at the time of the subdivision agreement.
[58] On the principles argued in this case, Erin cannot be sued for breach of contract with respect to a contract to which it was not a party. Mr. Maieron has provided no authority to make Erin liable for the agreement between Mr. Gulia and himself.
[59] The Town of Erin and the CVCA had authority to require these easements under the Municipal Act, 2001, S.O. 2001, c. 25 (s. 8), Planning Act, R.S.O. 1990, c. P.13, (s. 41(7) and 41 (10)), and the Ontario Water Resources Act, R.S.O. 1990, c. O.40 (s. 61 and s. 62(1)). Further, even if Mr. Maieron were successful in this application, the CVCA easement would remain on the property, as noted above at para. 40.
[60] Mr. Maieron should have had the land and should have paid the taxes; therefore, there is no loss to him based on when he paid them. The Town of Erin is obligated to collect such taxes; there can be no claim against it for doing so. There is no other damage claim against the Town of Erin. The claim against the Town of Erin is therefore dismissed.
[61] There can be no dispute that the terms of the two easements were different. Erin’s witness agreed that the terms were inconsistent. Mr. Gulia would have known of that inconsistency since he was party to both. He did not live up to his agreement with Mr. Maieron.
[62] Mr. Maieron may have had a damage, or some form of unjust enrichment claim against Mr. Gulia for failing to provide the land with the agreed easement terms, but he has not shown any damages or argued any damages except the payment of realty taxes.
[63] Mr. Maieron is entitled to be put in the place he would have been if the agreement with Mr. Gulia had been fulfilled. I agree with Mr. Gulia that the measure of damages is the difference in the value of the lands depending on which easement was registered upon it. However, I have no evidence of that difference, if any. I cannot guess to determine such damages. Without evidence of damages, this claim is dismissed.
[64] In argument, Mr. Maieron sought the removal of any installations made on the property; however, that was not claimed in his Statement of Claim. I do not have any evidence with respect to those alleged installations. The CVCA would likely have to be a party to such a claim. I have no evidence upon which to grant that request. That claim is dismissed.
[65] In the end result, Mr. Maieron has a deed that is contrary to his agreement with Mr. Gulia. However, the Town of Erin is not at fault for that. While Mr. Maieron may have had a claim for damages arising out of Mr. Gulia’s breach of the agreement, he has not asked for any and is now out of time to do so.
[66] Mr. Maieron can register the deed and carry on with the land as it is, or, perhaps, he can sell the deed. However, on this pleading, neither of the defendants can be ordered to do anything further.
Decision
[67] Accordingly, Mr. Maieron’s claim is dismissed.
Costs
[68] If costs cannot be agreed upon, the defendants shall provide their costs submissions within the next 15 days. Mr. Maieron shall provide his response within 15 days thereafter.
[69] Each submission shall be no more than three pages, not including any Bills of Costs or Offers to Settle. No reply submission will be accepted unless I request it. If I have not received any submissions within the time frames set out above, I will assume that the parties have resolved the issue and I make no order as to costs.
[70] The parties do not need to include the authorities upon which they rely so long as they are found in and the relevant paragraph references are included.
[71] Any costs submissions shall be forwarded to my office in Guelph by electronic transfer to teresa.pearson@ontario.ca or by mail to Guelph Superior Courthouse, 74 Woolwich St., Guelph, N1H 3T9.
Justice G. D. Lemon
Released: January 22, 2024