BARRIE COURT FILE NO.: CV-21-212-00 DATE: 20241230

ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN: GILLES BERTRAND, BERYL BERTRAND, FRANK JANOUCH, KENNETH JENNINGS, GEORGI JENNINGS, PASQUALE NIRO and DIANE SANT

Applicants

– and –

TOWNSHIP OF RAMARA and LAGOON CITY PARKS & WATERWAY COMMISSION

Respondents

Counsel: Christopher Lee and Tamara Watson, for the Applicants M. John Ewart, for the Respondents

HEARD: November 18, 2024

REASONS FOR DECISION

HEALEY, J.:

Nature of the Application

[1] The subject of this application are two by-laws enacted in 2020 by the Township of Ramara, concerning the construction and maintenance of shorewalls within a development known as Lagoon City.

[2] Lagoon City is a residential, waterfront community located on the shores of Lake Simcoe in the City of Brechin, Township of Ramara, originally developed in the late 1960s. One of the unique characteristics of Lagoon City is its series of intersecting canals that run along the rear of the properties located in the development. The canals and lots are separated by an easement in favour of the Township to allow for the construction and maintenance of shorewalls. Since the inception of the development, shorewalls were engineered and erected to prevent erosion of the properties that abut or are adjacent to the canals within Lagoon City.

[3] The Respondent, Lagoon City Parks & Waterway Commission (the “Commission”) was created in 1987 by the Township pursuant to provincial legislation, An Act respecting the Township of Mara, S.O. 1986, c. Pr21 (the “Mara Act”). The Mara Act authorized the Township to establish the Commission to provide for the governance of the lands conveyed to the Township, including those on which the shorewalls are constructed.

[4] The Mara Act also authorizes the Township to make a by-law requiring every owner of land abutting the canals to construct and maintain a shorewall at the owner’s expense, to the specifications and within the timelines set out in the by-law. Where an owner fails to do so, the Commission may do so at the owner’s expense, provided certain procedures are followed.

[5] On February 10, 2020, the Township passed By-law No. 2020.16, A By-Law Regarding the Construction and Replacement of Shorewalls Within the Development Known As Lagoon City. In doing so, the Township repealed and replaced By-law 2017.25, a by-law having an identical name.

[6] The effect of By-law 2020.16 was, among other things, to make the engineering specifications supplied by the Commission for repair and replacement of the shorewalls mandatory, and to make the Commission’s decision on the necessity of shorewall repair or replacement final, in the event of an owner’s appeal.

[7] At the core of this dispute is that By-law 2020.16 mandates that concrete fascia and coping be an essential, although purely aesthetic, design requirement.

[8] On July 27, 2020, the Township amended By-law 2020.16 by passing By-law 2020.57, (together the “New By-law”). The effects of By-law 2020.57 were to transfer the powers of the Commission to the Township, to provide that an appeal lies only to the Township, and to make the Township’s decision on the necessity of a repair or replacement of a shorewall final.

[9] The Applicants are all residents of Lagoon City who are owners affected by the enactment of the New By-law.

[10] The Applicants request:

(a) A declaration that the New By-law is ultra vires and void, and an order quashing it;

(b) A declaration that the New By-law is contrary to provincial statute, and an order quashing it;

(c) A declaration that the New By-law was enacted in bad faith, and an order quashing it;

(d) An order directing the Township to grant the permit applications submitted by the Applicants to replace the shorewalls abutting their respective properties;

(e) An order directing the Commission to render a decision as to the necessity of repair or cost of construction or repair of the proposed works;

(f) An interim order pursuant to s. 273(4) of the Municipal Act, 2001, S.O. 2001, c. 25 (“Municipal Act”) directing that nothing shall be done under the New By-law pending determination of this Application; and

(g) Costs.

[11] At the conclusion of argument, this court granted an interim order requiring that no enforcement steps be taken while this matter was under reserve by the court.

Positions of the Parties

[12] The Applicants assert that the New By-law should be struck due to illegality. Their position is that By-law 2020.16 and its amending by-law, By-law 2020.57, exceed the powers granted to the Township, are contrary to the terms of the Mara Act [1], and were passed in bad faith.

[13] The Applicants do not dispute that the shorewalls need to be repaired and recognize that shorewalls are essential infrastructure for Lagoon City. However, they object to the design requirements that have been foisted upon them by the Committee and the Township, who have ignored all engineering advice to the contrary.

[14] The Applicants, who are all retired, will collectively be forced to spend hundreds of thousands of dollars to replace shorewalls with concrete façades if this application is not granted. They argue that the demand by the Commission for concrete caps and fascia is made purely for aesthetic reasons.

[15] In 2018, two of the Applicants, Kenneth and Georgi Jennings, submitted building permit applications with stamped engineering drawings to rebuild their shorewall, which they say complied with the by-law in force at the time, and which offered a less expensive and more beneficial alternative. They were deliberately thwarted by the Respondents. The rest of the Applicants submitted their building permit applications in 2019. During this litigation, the Respondents have admitted that the Jennings’ building permit application met the requirements of the earlier by-law.

[16] Even when the Applicants followed the Mara Act and all applicable by-laws, the Respondents instructed the Chief Building Officer not to issue the permits. The Commission also refused to decide some of the Applicants’ appeals. Instead, they passed the New By-law to ensure that the building permit applications were no longer compliant and to ensure that the desired concrete aesthetic would be achieved.

[17] The Applicants argue that the New By-law and the circumstances of its enactment bear sufficient badges and indicia of bad faith on the part of the Respondents to have it quashed. Further, it was passed for a purpose collateral to the Mara Act and conflicts with the purpose and provisions of that Act.

[18] The Respondents’ position is that they have acted within the scope of their authority and in good faith, and it is not for this court to substitute its own views for that of publicly elected officials. The New By-law was passed for the purpose of requiring the construction and maintenance of shorewalls, which are necessary to prevent erosion and degradation that could adversely affect the canals, as indicated in its preamble.

[19] By-law 2020.16 derives its express authority from the Mara Act, as well as s. 5 of the Municipal Act. The Respondents emphasize that municipal powers are to be interpreted broadly and generously within their context and statutory limits to achieve the legitimate interests of the public, and only in the clearest of cases should a municipal by-law be held to be ultra vires.

[20] Further, the Respondents take the position that the Applicants have failed to meet the heavy onus on them to establish that the Township acted in bad faith. According to the Respondents, By-law 2020.16 involved much public debate and the Applicants were aware, in advance, that the Township was tabling it for a vote. Much of the Applicants’ evidence and argument relates to the unreasonableness of the New By-law, which is irrelevant to the issue of whether a by-law is illegal. Further, the Respondents submit that any conduct amounting to bad faith on the part of the Committee, which is denied, is not the conduct of the Township Council.

[21] The Respondents submit that the modern judicial approach is to exercise restraint and not impinge on municipal democracy by quashing a by-law, and that such an approach should be followed on this application.

Evidence

[22] The evidence on this application is derived from:

(a) The affidavits of Georgi Jennings (“Jennings”) and Mark Kolberg (“Kolberg”), submitted by the Applicants. Jennings is one of the Applicants. Kolberg is a professional engineer with expertise in marine and coastal engineering, who authored an expert report for this proceeding;

(b) The affidavits of Leo Grellette (“Grellette”) and Tim Collingwood (“Collingwood”), submitted by the Respondents. Grellette is the Senior Advisor for Planning Services for the Township. Collingwood is a professional engineer with the firm of Tatham Engineering Limited, consulting engineers for the Township.

(c) Evidence taken on the cross-examinations of Jennings, Grellette and Collingwood.

Lagoon City

[23] The Corporation of the Township of Ramara is a municipal corporation incorporated pursuant to the provisions of the Municipal Act. It was formed in 1994 by the amalgamation of the townships of Rama and Mara.

[24] The Applicants are all neighbours who reside in Lagoon City on Old Indian Trail, each owning property backing onto a canal.

[25] An early 1970s promotional brochure for Lagoon City shows that the development was created as a planned community for recreation and retirement. There are approximately 2,000 residents of Lagoon City.

[26] A unique feature of Lagoon City are the canals that run along the rear of each property in the development. There are 16 kilometres of intersecting canals that provide access to Lake Simcoe.

Shorewalls

[27] Shorewalls were erected along the canals to divide the water from the land. The purpose of the shorewall is to act as a retaining wall to prevent erosion of a portion of the lots that are adjacent to the canals. The Township has an easement over the first 10 feet of land from the canal.

[28] There are approximately 876 shorewalls within Lagoon City. It is uncontested that the construction and maintenance of the shorewalls is the responsibility of property owners.

[29] There are three types of shorewalls currently in place. The most common type has a concrete fascia backed with wooden sheathing. There are also shorewalls comprised entirely of wood, and others comprised entirely of concrete. Most shorewalls are capped by concrete coping.

[30] The definition of shorewall in the Mara Act, and the New By-law, is the same:

“shorewall” means a building improvement on a lot or block on a registered plan of subdivision or registered reference plan abutting a waterway and constructed to replace the natural shore at the rear or side of the lot or block.

The Mara Act

[31] On November 4, 1986, the Legislature enacted a Private Member’s Bill, being the Mara Act. The Mara Act was specifically aimed at regulating Lagoon City and its canals, waterways, shorewalls, and parks.

[32] The preamble to the Mara Act provides:

Whereas The Corporation of the Township of Mara considers it desirable that it be given power to acquire real property, including easements in or over real property, that is being used, or intended to be used, for private parks, foot-bridges, foot-paths and waterways; that it is also desirable that the Corporation be given the power to establish a local board to manage, maintain, regulate and control the property so acquired; and whereas the Corporation desires to apportion the cost of the maintenance and regulation among the properties obtaining a benefit therefrom; and whereas the Corporation hereby applies for special legislation for such purposes; and whereas it is expedient to grant the application;

[33] The Mara Act permits the Township to pass a by-law to create a commission, specifically the Lagoon City Parks and Waterways Commission established pursuant to subsection 3(1) of the Act, to manage, maintain, regulate and control easements and lands conveyed to the Township, including waterways. Pursuant to subsection 3(2), the Commission is a local board within the meaning of the Municipal Affairs Act, R.S.O. 1990, c. M.46.

[34] Pursuant to subsection 4(1) of the Mara Act, the Commission shall consist of two members appointed from Council, and three members appointed by Council who must be owners or tenants in a registered subdivision in which land has been conveyed under the Mara Act.

[35] Pursuant to subsection 7(1), the Township may make a by-law requiring every owner of land abutting a canal to convey to the Township an easement on which to construct and maintain a shorewall, at the owner’s expense, to the specifications and within the time limits set out in the by-law. Under subsection 7(3), where an owner fails to do so in accordance with the by-law, the Commission may construct or repair the shorewall at the owner’s expense.

[36] The Mara Act contains provisions for owners to appeal a decision of the Commission. The Commission is required to give the owner an opportunity to make oral or written submissions as to the necessity of repair or cost of construction or repair provided that the procedures set out in the Mara Act are followed. Thereafter, the Committee is required to advise the owner of its decision after consideration of any objections.

[37] Subsection 7(4) of the Mara Act allows an owner to appeal the decision of the Commission to the court of revision established under s. 43 of the Local Improvement Act, R.S.O. 1990, c. L.26, as repealed by s. 484(2) of the Municipal Act. Where such an appeal has been commenced, no work referred to in the appeal shall be undertaken by the Commission until the court of revision has made a decision or, where a further appeal has been made to the Ontario Municipal Board (now its successor, the Local Planning Appeal Tribunal), until that tribunal has rendered its decision.

[38] Under subsection 7(6), the court of revision has jurisdiction and power to review the necessity of repair or the cost of construction or repair of the work proposed by the Commission and may order that additional estimates of cost be obtained, and/or that an inspection and report be provided by an independent, qualified engineer.

By-Law 97.54

[39] The longstanding by-law that governed the shorewalls in the Township was By-law No. 97.54 [2], A By-law Regarding the Construction and Maintenance of Shorewalls Within the Development Known as Lagoon City (14 July 1997), which served to standardize the construction and repair of the shorewalls.

[40] Stamped engineering designs, attached as schedules to By-law 97.54, allowed for three different shorewall designs. The provisions of section 4.0 are most relevant. Section 4.2 required that all construction and maintenance of shorewalls was to be carried out in accordance with the designs and specifications of a professional engineer unless, as set out in section 4.4, a steel pile could be driven at least three feet into the bedrock. In that case, concrete shorewalls were required to be used for a “straight wall” configuration, and steel shorewalls were required to be used for “angled recess” shorewalls.

The 2015 Inspection by the Commission

[41] In 2015, the Jennings made a visual inspection of the shorewalls from the canals, noting that some appeared to be in poor condition. They saw that some of the walls capped with concrete coping were sinking or leaning out into the canals, while others had deteriorating concrete with exposed tie rods or missing beams. Some of those constructed entirely of wood were likewise in disrepair.

[42] In September 2015, the Commission also conducted a visual inspection of the shorewalls. The Commission then sent letters to some property owners, one of which was received by the Applicants, Gilles and Beryl Bertrand. The correspondence stated that the Bertrand’s shorewall had to be repaired or replaced and demanded a response within 30 days.

[43] Beryl Bertrand objected on the basis that the Commission members were not engineers and had no qualifications to justify imposing the heavy costs of replacing shorewalls based on a visual inspection alone. The Commission subsequently sent a follow-up letter asking property owners to disregard its earlier correspondence and stating that a new approach would be forthcoming.

Recommendations of the Township’s Engineers

[44] Shortly after purchasing her property in 2015, Jennings began to attend the Commission’s monthly public meetings. The shorewalls were a frequent topic of discussion. At one of the first meetings she attended, then-Chairman Bob “Skip” Beatty publicly stated that the commissioners wanted all shorewalls to have concrete caps and fascia. It was apparent to her from the beginning that the commissioners were focused on aesthetics.

[45] The Commission passed a resolution on October 8, 2015 to investigate a shorewall inspection program with the Township engineers, C.C. Tatham & Associates Consulting Engineers (“Tatham”), and to seek Tatham’s recommendations on amending or replacing By-law 97.54.

[46] Tatham began its inspection process in September 2016, involving 58 properties as the first phase of a multi-year inspection program. In mid-September, Jennings met the engineer-in-training with Tatham, who introduced himself as such, who was performing a visual inspection of one of the shorewalls. He seemed to be alone and was carrying no equipment other than a clipboard. She discussed these inspections with several of her neighbours, who reported that they had seen the same engineer-in-training, unaccompanied.

[47] Tatham produced an inspection report dated November 23, 2016. Although the report was sealed by a senior engineer, it was authored by the trainee.

[48] The report concerned the Jennings because it did not include any geotechnical analysis of the soils or any underwater inspection of the shorewalls. When rebuilding their home along the canal the previous year, the Jennings had learned about the importance of a proper geotechnical assessment of the soils for any plan to rebuild, from the professionals they retained.

[49] Tatham’s 2016 report made several recommendations. Finding that it would be impractical to drive steel piles three feet into bedrock, Tatham recommended that the wording of section 4.4 of By-law 97.54 be revised to state that the piles be driven to refusal at bedrock. After noting that the By-law restricts the shorewalls to certain types and configurations, they recommended that the Commission define the allowable wall types in more detail, including possible alternative materials, while maintaining the desired general aesthetics as per section 4.3. This recommendation was made “in order to allow property owners to better manage their wall construction and to provide an opportunity for property owners to consider construction cost and the lifecycle cost-benefit of different material types”. Tatham also recommended that By-law 97.54 be revised to clearly define the aesthetics desired by the Commission.

[50] The Tatham report also noted that the leaning of shorewalls observed during the inspection may be attributed to the relatively heavy concrete fascia panels. The report states: “upon review of the standard designs, we believe the weight and eccentricity of the concrete fascia panels would only advance the leaning upon a failure of the tie-backs and/or anchorage.”

[51] A geotechnical study has never been identified or produced by the Township, even though Ken Jennings requested a copy of any existing report.

[52] Tatham then sent a letter to the property owners to submit a proposed work plan for shorewall repairs to the Commission by October 31, 2017. These owners are part of the “Phase One” inspection.

[53] The Township issued invoices to the owners for Tatham’s inspection, which was charged at a rate of eight dollars per linear metre. Four years later, and only because of the Applicants’ demands after learning that this was an unauthorized charge, the Township reimbursed the owners for this cost.

By-law 2017.25

[54] On April 13, 2017, the Commission met to discuss potential amendments to By-law 97.54. Although this was a public meeting, the agenda was not posted when Jennings checked the night before, nor the following morning before the scheduled start time of 9:30 a.m. As she had other commitments that day, she did not attend and was unaware that by-law amendments were to be discussed.

[55] On April 24, 2017, the Township Council passed By-law No. 2017.25, A By-law Regarding the Construction and Maintenance of Shorewalls Within a Development Known As Lagoon City. [3]

[56] It is Jennings’ uncontested evidence that roughly two-thirds of Lagoon City residents are cottagers or snowbirds who had not yet returned for the season by April 24. Even for the year-round residents, the Minutes of the Commission’s April 13, 2017 meeting were only made available weeks after By-law 2017.25 was passed by the Township.

[57] By-law 2017.25 did not clearly define the aesthetics required by the Commission, as suggested by Tatham.

[58] Section 2 of By-law 2017.25 requires maintenance and construction to occur in accordance with the By-law. Owners were required to maintain the shorewall in a state of repair satisfactory to the Commission, but importantly, s. 2.2 provided that “the requirements of the said Commission shall at no time exceed the specifications set out herein”. Section 2.3 states that “all construction or repair work shall conform to the specifications set out in [s]ection 4 herein”.

[59] The critical section pertaining to shorewall repair and maintenance is again section 4. Under s. 4.2 of By-law 2017.25, an owner was again only bound by the requirement to construct a shorewall based on a design supplied by that owner’s own engineer. Section 4.2 provides that:

All construction or maintenance of shorewalls shall be carried out in accordance with the designs and specifications of a professional engineer retained by the owner, except as provided in 4.4, 4.5, 4.6.

[60] Under section 4.2, the inclusion of concrete fascia panels is not identified as one of the additional requirements to be included in the design to be prepared by the professional engineer retained by the owner. Nothing in 4.2 requires the owner to comply with the design and specifications set out in either Schedule B or C, nor does it reference s. 4.3.

[61] Section 4.3 states that all designs and specifications shall be prepared to maintain the “general exterior appearances shown in Schedule B and Schedule C”. “General exterior appearances” is not defined. Those Schedules show that concrete caps and fascia were indicated. However, the designs in those Schedules were to be used only where the steel pile could be driven at least three feet into the bedrock, and even then, they are only an option.

[62] At section 4.4, By-law 2017.25 addresses the issue of steel piles being driven to bedrock refusal, allowing for use of the designs specified in Schedule B or C in the event that the owner did not have professional engineering designs.

[63] Section 4.5 states that the deadhead anchors depicted in Schedules B and C may be used if the repair does not involve the replacement of any piles.

[64] Under section 4.6, all steel surfaces directly exposed to open-air or steel elements below grade having less than one foot of permanent soil cover were to receive an application of a corrosion inhibitive coating.

Questions Posed by the Jennings

[65] At the Commission meeting held on May 11, 2017, Ken Jennings gave a deputation in which he posed questions about the recommendations in the Tatham report and By-law 2017.25. Many of those questions were focused on the cost of the materials required by By-law 2017.25. They also focused on the lack of public consultation prior to the Commission’s recommendations being placed before the Township to be promulgated in what appeared to be a rushed manner, occurring only nine days after the Commission meeting.

[66] Those questions were not answered at the meeting. The Commission instead adopted a motion by Deputy Mayor/Commissioner John O’Donnell to answer the questions. Two months later, the questions remained unanswered, but the Commission continued to give assurances that it would do so. At the Commission meeting held on July 13, 2017, the Commission passed another motion affirming that it would answer these questions.

Community Meeting July 2017

[67] In July 2017, the Jennings organized a community meeting for Lagoon City property owners who would be impacted by By-law 2017.25. They invited the Commission to speak and answer questions. Since very few property owners heard about the Commission’s discussion of the By-law or its recommendations to the Township in time to participate, the Jennings hoped to create an opportunity for the people most affected to hear the basis for the Commission’s recommendations regarding By-law 2017.25.

[68] The day before the scheduled meeting, the Commission Chairman, Todd Billinger, sent Jennings an email stating that the Commission would not attend the public meeting unless all questions were removed from the agenda.

[69] Feeling they had little choice in the circumstances, the Jennings agreed. The meeting went ahead and was attended by roughly 120 Lagoon City residents. During the meeting, Commissioner/Ward 5 Councillor Kal Johnson recommended that those property owners concerned with the cost of repairing or replacing their shorewalls should form a group to negotiate better prices.

[70] On August 10, 2017, at the next Commission meeting, its members voted to rescind its previous two motions to answer the questions posed by Ken Jennings at his deputation. Those questions were never answered.

Lagoon City Phase One Group

[71] In September 2017, the Jennings and the Bertrands organized another public meeting for Lagoon City property owners. Roughly 75 owners from the area affected by the Phase One inspection met to discuss forming a group to find a cost-effective, environmentally friendly alternative to the Township’s shorewall design. This group informally refers to itself as the “Phase One Group”. The Applicants are all members of the Phase One Group.

[72] Through the financial contributions of its members, the Phase One Group compiled a team of experts: a civil engineer, Stiemer Engineering; a marine contractor, T&C Construction/Welding Ltd. (“T&C”); a geotechnical engineer, Cambrium Inc.; and a supplier, Crane Manufacturing Industries (“CMI”).

[73] The product offered by CMI is synthetic sheet piling, which is used as an alternative to concrete. The Jennings were aware of this material from having seen shorewalls constructed with it in other communities and had been impressed by the clean aesthetic and apparent durability. They understood that it did not crack or spall with age, and having no steel components, would not rust or corrode.

[74] On October 23, 2017, Jennings made a deputation at a Township Council meeting to request a six-month extension for the Phase One property owners to submit their proposals for repair and remediation.

[75] On October 31, 2017, the Phase One Group submitted a letter to the Commission stating that they were working with an engineer to develop an alternative shorewall design that would be cost-effective, aesthetically similar, and environmentally friendly. The letter also stated that the group planned to proceed with the required remediation and anticipated moving forward with applications for the required permits in a timely manner.

[76] By the end of 2017, the Phase One Group had formally retained Stiemer Engineering. On February 2, 2018, the group held a meeting with representatives of CMI, T&C and Stiemer Engineering, as well as a representative from the local distributor for CMI products. The group secured a commitment from CMI for technical assistance and additional engineering expertise, and the supplier agreed to supply the synthetic sheet piling at a group rate. That same month, the group retained Cambrium Inc. to conduct a geotechnical analysis and produce a soil report for the Phase One area.

[77] In July and August 2018, T&C provided quotes to various members of the Phase One Group for the replacement of their shorewalls using synthetic sheet piling. Samples of these quotes that are included in the application record range from $43,172 to $72,676.

[78] On October 16, 2018, Stiemer Engineering provided the stamped drawings for the shorewall design. Although the drawings were for the Jennings’ property, they represent the design intended to be used by the entire Phase One Group.

Default Notices

[79] Throughout their efforts, the Phase One Group kept the Commission apprised of their efforts to repair or rebuild their shorewalls. This included Steimer Engineering sending a letter to the Township in September 2018 that provided an update on the group’s shorewall design.

[80] Nonetheless, on or about November 13, 2018, the Applicants (except the Jennings) received notices on Township letterhead and signed by the Commission indicating, among other things, that they were in breach of their obligations under By-law 2017.25. The correspondence stated that the Commission would act to repair or replace the shorewalls at the owners’ expense, according to the plans and specifications set out by the Commission.

[81] The notices were accompanied by preliminary estimates prepared by Tatham for the construction cost. For the Applicants, these ranged from $84,000 to $117,950.

[82] As stated, the Jennings did not receive a default notice. The reason for that was that earlier that month, on November 1, 2018, a representative of T&C submitted the Jennings’ applications for the building permits necessary to replace their shorewall to the Township’s building department, including the stamped engineering drawings.

[83] The Township did not issue a receipt for the Jennings’ application until the following year, on April 1, 2019. The Township also never processed their application.

Committee Use of Private E-mail to Communicate

[84] The evidence establishes that the commissioners used their private emails to communicate from time to time.

[85] For example, attached as Exhibit 19 to Jennings’ affidavit is an email sent on July 14, 2017 by the Commission Chairman Billinger, which informed the Jennings about the Commission’s position on the questions required to be removed from the agenda for the public meeting. Although the Chairman sent the email in his public capacity, he used an email account from his private company, High Command Distributing. It is Jennings’ evidence that Billinger addressed the email to all but one of the other commissioners at their personal emails.

[86] It was at this point that the Jennings became aware that the commissioners appeared to regularly conduct official business through personal email accounts.

Tatham Review of the Stiemer Drawings

[87] In December 2018, Tatham conducted a peer review of the Stiemer designs. The Phase One Group paid $750 to cover the expense of the review despite the fact that it was not in the Township’s fee schedule.

[88] Tatham’s review was released to the Commission on December 11, 2018. The report noted that the design details did not refer to a concrete fascia panel or concrete coping, but instead specified a cap by the manufacturer. Tatham recommended further review by the Commission as to whether the proposed material will conform to the generally consistent appearance that By-law 2017.25 was attempting to preserve throughout the development. Otherwise, no significant problems were noted with the Stiemer design.

[89] On December 13, 2018, the Commission scheduled a meeting. T&C contacted the Commission in advance of the meeting and requested time to speak and present information. The response from the Council/Committee Coordinator and Committee Secretary/Treasurer, Nicole Brittain (“Brittain”), was that the peer review and the “initial drawing submitted” would be one of the first items to be reviewed, during closed session.

[90] The Phase One Group’s engineer, marine contractor, and a CMI executive who had flown in from Georgia all attended the December 13 meeting, but the Committee did not allow any of them to present their information.

[91] Throughout 2019, the Jennings made inquiries about whether their building permit application would be approved, but even when they personally went to the building department to see if there were any updates, they received no information.

[92] On more than one occasion, Ken Jennings called the Chief Building Officer, Dave Wellman, to ask for updates on the status of their building permits. Ken Jennings was told that the Commission had instructed the building department not to issue the permit.

Appeal Hearing

[93] Those Applicants who had received default notices (the “Appellants”) appealed to the Committee in accordance with the Mara Act. The appeal hearing was held before the Committee on March 13, 2019. This was the first time in the Commission’s history that it had heard an appeal. The Appellants were represented by legal counsel.

[94] The Appellants sought to stay the enforcement proceedings against them under By-law 2017.25 on grounds that included:

(a) The shorewall inspection findings conducted by the Commission did not justify the extent of the repairs specified in the notices of breach;

(b) The Appellants were actively engaged in a process to repair and replace their shorewalls;

(c) The default requirement in By-law 2017.25 was for an owner to construct a shorewall based on designs supplied by an engineer retained by the owner, as set out in subsection 4.2;

(d) A stay would allow the Appellants to submit engineering permit drawings to the Township just as the Jennings had done in November 2018; and

(e) The limited circumstances in which construction must proceed based on designs supplied by the Commission as prescribed by the By-law did not apply to the Appellants.

[95] The Commission reserved its decision. On April 11, 2019, the Commission passed a resolution extending its decision on the appeal hearing by 30 days.

[96] The Commission has never rendered its decision.

Approval of the Conservation Authority

[97] In May 2019, the Lake Simcoe Region Conservation Authority confirmed by correspondence that it had no issue with the proposed use of synthetic sheet piling. However, it advised that the permit application was not complete until such time that the Conservation Authority received written confirmation “from the Township stating that they can approve the new sheet pile wall engineered design.”

[98] On May 9, 2019, Jennings attended a Commission meeting and read the Conservation Authority’s statement to the Commission. She was then asked to leave for a closed session. The Minutes of the meeting do not reflect any of the information conveyed by Jennings. Within the closed session under “potential litigation matter regarding shorewalls”, the minutes record a resolution that legal counsel be invited to attend a special Commission meeting, and that the shorewall appeal hearing decision be extended until further notice due to “ongoing legal consultant negotiations”.

[99] On May 14, 2019, the Commission sent letters to the Appellants stating that it was extending the appeal hearing decision until further notice but that the decision would be “forwarded in due course”.

[100] On May 16, 2019, the Conservation Authority stopped waiting for the Township’s answer and issued a permit to the Jennings for the installation of a new sheet pile wall along the same footprint as the existing concrete shorewall subject to, among other things, municipal by-laws.

Additional Building Permit Applications

[101] In September 2019, the remaining Applicants applied for the building permits needed to replace their shorewalls, which were also prepared and submitted to the building department by T&C. These permits were reviewed and approved by the Conservation Authority in October 2019.

The Township Repeals and Replaces By-law 2017.25

[102] Grellette’s evidence is that following the appeal hearing, municipal council and the Commission undertook a review of By-Law 2017.25, which resulted in the passage of By-law 2020.16 as discussed below.

[103] In December 2019, the Township posted a draft by-law on a website that it had just created and which, according to Jennings, most community members would not have known about at the time. Presumably, this is what Grellette has referred to in his affidavit when he said that the public was given the opportunity to provide comment on the draft legislation before it was enacted, as he provided no other details of public review or engagement.

[104] The Phase One Group communicated to as many people in the community as they could about the proposed by-law and let them know that a Township council meeting would be held on January 27, 2020. Roughly 150 people attended. Jennings made submissions to the Township at the council meeting and raised numerous concerns about the proposed by-law and its impact on Lagoon City and Ramara, which received support from those members of the public in attendance.

[105] The following month, on February 10, 2020, the Township repealed and replaced By-law 2017.25 with By-law 2020.16, A By-Law Regarding the Construction and Replacement of Shorewalls Within the Development Known as Lagoon City. [4] As with its predecessor, By-law 2020.16 was passed when roughly two-thirds of Lagoon City residents had not yet returned for the season from their winter residences.

[106] The major changes introduced by By-law 2020.16 were as follows:

(a) The specifications supplied by the Commission for repair or replacement of the shorewalls became mandatory, including concrete caps and fascia and sheet pile driven to refusal;

(b) The Commission must render a decision on the necessity of shorewall repair or replacement within 30 days of an appeal hearing;

(c) The Commission’s decision on the necessity of shorewall repair or replacement is final; and

(d) An owner of a property abutting a canal is obliged to construct a shorewall within two years of the date of conveyance, even where conveyance occurred before the enactment of the By-law, thereby imposing the standards set by the By-law on a retroactive basis.

[107] The Schedules for By-law 2020.16 were prepared by Tatham. Section 5.3 of By-law 2020.16 provides that all designs and specifications shall be prepared to maintain the general exterior appearances shown in the attached Schedule B, which shows that concrete coping and concrete fascia are mandatory.

[108] Although both Grellette and Collingwood’s evidence is that the Schedules developed for By-law 2020.16 allow owners to make use of any material they want as long as the design of the structure is completed and sealed by a licensed engineer, this is obviously far from the truth given the provisions of subsection 5.3. Collingwood admitted on cross-examination that “any material” still required concrete fascia and coping.

[109] Grellette’s evidence is that By-law 2020.16 was prepared primarily to address the concerns presented to the Commission in March 2019 at the time of the appeal hearing, and to address any ambiguity that may have existed with respect to the standards for the construction and maintenance of shorewalls contained in By-law 2017.25. His affidavit does not provide any detail about the nature of the “ambiguity”.

[110] Grellette’s affidavit further states that By-law 2020.16 is similar to its predecessor and is “aimed at providing uniform standards for the construction and maintenance of shorewalls within Lagoon City, while providing instruction as to the type of shorewall that would be acceptable to the Township and the Commission”.

[111] Correspondence from the Township’s counsel to the Applicants’ counsel dated June 1, 2020 advised, on behalf of the Commission, that By-law 2020.16 established new specifications for maintenance of the shorewalls. As a result, any decision arising from the appeal hearing would have no application as a result of its promulgation, as the Commission’s jurisdiction to render a decision with respect to By-law 2017.25 had been effectively removed.

[112] At his examination, Collingwood confirmed that the Township or the Commission instructed Tatham that the shorewalls had to have concrete coping and fascia. He agreed that there was no engineering reason for this, nor does it make the shorewall stronger. Instead, the shorewall needs to be stronger to support the weight of the concrete.

Township Passes By-law 2020.57

[113] A few months after enacting By-law 2020.16, on July 27, 2020 the Township passed By-law No. 2020.57 [5], a by-law to amend certain sections of By-law 2020.16.

[114] By-law 2020.57 purports to transfer the powers of the Commission to the Township. It requires maintenance or repair of shorewalls to be in a manner satisfactory to the Township, provided that the requirements of the Township do not exceed the specifications set out in By-law 2020.16. Notice of the required work is to be given by the Township. Enforcement is to be carried out by the Township.

[115] Perhaps most significantly, By-law 2020.57 adds a new section to By-law 2020.16 for the purpose of establishing an Appeals Committee appointed by Council. As mandated by By-law 2020.16, the decision of the Appeals Committee is final.

Freedom of Information Request

[116] The Applicants decided to submit a request for records under the Municipal Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. M.56 (“MFIPPA”) to shed light on the decision-making process. The original application was made on August 14, 2020.

[117] The Township provided access to the publicly available records on May 7, 2021. The fee to process this request was $1,470.

[118] However, these records did not include any of the communications sent on behalf of the Commission exclusively from or to personal email accounts, which obviously exist.

[119] It is Jennings’ evidence that the records received from the Township confirmed the Applicants’ suspicions that the Township had been directing the Commission, and that the activities of both the Township and the Commission have been focused on a pre-determined goal of a concrete aesthetic for the shorewalls.

[120] The records also confirm that the use of personal emails among the Commission members was a habitual occurrence. The emails that were produced were obtained primarily because Brittain used her official Township of Ramara email address.

[121] The information garnered through the MFIPPA application confirmed that concrete has been the Commission’s overriding concern. In an email to Brittain on November 8, 2018, Collingwood stated that the design submitted by the Phase One Group did not meet the aesthetic requirements of By-law 2017.25 since they did not include concrete fascia. The email also describes the process for peer review of the design drawings by Tatham, by which Tatham would generate comments after doing an engineering technical review and a review for compliance with the By-law. He noted that the review may show that the design is acceptable, and the Applicants can proceed with the permit application, or there may be items the Applicants must address and resubmit for second review. Depending on the scope of comments, Brittain was told that she may then have to go to the Commission for further review/discussion.

[122] On November 8, 2018, in an email among Commission members and Brittain, Commissioner Kal Johnson referred to sending the notices of default to the four Appellants “ASAP”, stating that he had told the Applicants to form a group to work with a contractor to get a reduced price to repair their shorewalls, not “form a group to find a new way to build shorewalls”. He also stated that if the plans that the Appellants intended to present to the Township’s engineers for review were the plans that the Commission had been “saying no to from the beginning”, then the Commission was wasting its time “again”.

[123] He concluded by saying that he thought that “we have all been extremely reasonable with this group” and that he was “personally sick and tired of dealing with this”. The notices of default were sent out five days later.

[124] On November 10, 2018, in an email chain among Commission members and Brittain, Commissioner Kal Johnson referred to the design drawings submitted by the Appellants and stated that “if no concrete facings on them they will not pass.” The Jennings had submitted their permit application on November 1, 2018, and were to hear nothing further about it until the following year, when they were told by the Chief Building Official that the Commission had told him not to issue it.

[125] On November 12, 2018, in an email chain among Commission members and Brittain, Commission Chairman Billinger suggested that the Commission must now consider the shorewall design drawings submitted by the Appellants because someone “dropped the ball” and did not send the default notices more quickly. This email suggests that commissioners seemed to know that they were in a difficult situation at that point.

[126] In a December 18, 2018 email from Commissioner Robert Poyntz to the other commissioners, Poyntz stated that he does not like the alternate design and “will never give approval” for its use in Lagoon City. He expressed the opinion that the Commission should be tabling a motion to reject the design on the grounds that “the continuous run of shore wall [would] be broken” and based on his belief that the shorewall design would compromise existing shorewalls.

[127] On April 5, 2019, Brittain circulated an email to commission members stating that the building department was looking to her for direction on permit applications for one of the properties that had submitted design drawings. Her email stated that, in the interim, the building department was “holding onto the application”, although Brittain noted that from the discussion held at the Special Meeting on March 25, she did not believe that “there was anything the Commission can do at this point to pause this”.

[128] That same email attached the Commission’s draft decision from the appeal hearing, which concluded that the Commission did not need to proceed with the work set out in the notices of default, as the Appellants intended to complete the necessary work themselves within a reasonable amount of time “and in compliance with all applicable law”.

[129] On May 14, 2019, Brittain and the commissioners discussed and agreed to an indefinite extension for the appeal decision.

[130] These months of inaction on the part of the Commission, the evidence reveals, was partly due to the fact that they were waiting for legal advice on the situation and, as Brittain would convey to the Respondents’ current counsel on June 11, 2019, the Commission was “displeased with the legal recommendations from the previous law firm Ramara contracted with”.

[131] In her email of June 11, 2019, Brittain explained the history of the matter and set out the Commission’s position on the alternate shorewall design put forth by the Phase One Group. She stated that “[t]he members of the LCPWC [Commission] initially were not in favour of the design as it is made of plastic rather than concrete. The members want a unified design for shorewalls – much like a curb in a neighbourhood. It’s been a very hot topic”.

[132] The email expressed that the Commission did not want the Jennings’ shorewall design to proceed, and that the Chief Building Officer had not issued the permit because he knew that the Commission did not want it issued. In the same email, Brittain expressed the opinion that she did not think that “we” can bar the permit from being issued “with the current state of By-law 2017.25”. She noted that at the appeal hearing the lawyer representing the Appellants “presented a case on behalf of the four homeowners and, to be quite blunt, ripped By-law 2017.25 apart.” Brittain sought advice on how to amend By-law 2017.25 “to give authority” and remove “loop-holes”, how to proceed with the four properties that had gone through the appeal process, how to proceed with the “alternate design group”, and how to deal with the Phase One property owners who were requesting to have their shorewall inspection fee reimbursed, as By-law 2017.25 did not authorize the Committee to charge such a fee.

[133] In a November 1, 2019 email chain between Township clerk Cathy Wainman and the members of the Commission, Wainman asked for direction about what to do with the shorewall permit applications received, noting that two applications are for steel walls and three applications are for vinyl walls. She wrote:

The CBP confirms that he could issue permits for the two steel walls if the concrete cap and fascia were included. The contractor is arguing that the people do not want the concrete on their walls and since these are engineered drawings it should not be a requirement.

[134] Chairman Billinger suggested that she not reply until the Commission had received legal advice.

[135] On February 8, 2020, Councillor David Snutch wrote to his fellow councillors stating that he did not support the proposed by-law and more information on cost was needed before the Township could enforce concrete caps and fascia “for cosmetic purposes only”. He expressed his view that concrete would be nice, but not at the extra cost. He inquired about the increased cost per foot for the concrete. He noted that no one had yet been able to supply him with that number.

[136] On February 25, 2020 (notably 15 days after the Township had passed By-law 2020-16), Commissioner/Councillor Johnson obtained a shorewall quote from the Phase One Group’s contractor. The quote sets out options for steel or synthetic sheet piling, with and without concrete capping and fascia. The option for concrete capping and fascia roughly doubled the cost of the quote.

Building Permit Denied

[137] On October 29, 2020, the Jennings received correspondence from the Township’s infrastructure department stating that their permit was deemed incomplete under the New By-law.

Expert Engineering Evidence

[138] Kohlberg’s qualifications to provide expert evidence to the court were not challenged.

[139] His curriculum vitae indicates that he has 39 years’ experience in all phases of coastal and marine engineering projects. He is licensed as an engineer in both Ontario and Nova Scotia. The overview states that throughout his career, Kohlberg has focused on feasibility and integrated planning and design studies, final design and construction supervision and administration, environmental assessment, and regulatory approvals. He has worked on waterfront projects, to name a few locations, extensively throughout the Great Lakes system, Lake Winnipeg, Lake Simcoe, Lake Nipigon and the Caribbean. He is currently the Principal of W. F. Baird and Associates, Coastal Engineers Ltd. located in Oakville.

[140] Kohlberg’s expert report is dated December 3, 2021, and he has signed an Acknowledgement of Expert’s Duty.

[141] In examining By-law 2017.25, Kohlberg concluded that the sealed designs in the Schedule B and Schedule C drawings are not applicable if the design of the shorewall is completed by a professional engineer as set out in section 4.2.

[142] In his review of the Schedules B and C drawings, he reviewed the functional purpose of each of the components and concluded that the concrete fascia panels do not serve a primary structural purpose for the shorewall, being simply attached to the surface of the shorewall by mounting bolts. The concrete fascia panels are included for appearances or cosmetic purposes. With respect to the requirement for tie rods and deadhead anchors, he noted there is no rational explanation provided as to why alternative, possibly better anchor designs, in accordance with accepted engineering practice, would not be permitted.

[143] Kohlberg notes that Schedule B of Bylaw 2020.16 contains three drawings by Tatham that present schematic illustrations of the general nature of the shorewalls. The illustrations are not detailed, sealed engineered design drawings for shorewalls. This was also Mr. Collingwood’s evidence, which was that these drawings serve only to illustrate an example of a typical shorewall that could be implemented.

[144] Kohlberg referenced the estimate prepared by T&C dated March 26, 2020, which estimated that the cost of the concrete coping and fascia increases the cost of the shorewall by about 50%. Kohlberg’s view is that the inclusion of cosmetic concrete fascia panels bolted to the front of a shorewall unnecessarily complicates the wall design and introduces additional connections that could potentially be a future problem due to breakage or corrosion.

[145] In summary, he has provided the following opinions:

(a) By-law 2020.16 contains some requirements that are not rationally connected to accepted engineering design practice requirements for a standard anchored vertical bulkhead shorewall, including the mandatory requirement to use a specific concrete deadhead anchor arrangement, the mandatory requirement for a concrete fascia panel for cosmetic purposes that substantially increases the cost of the shorewall to the owner, as well as the mandatory requirement that sheet piling be driven to refusal at bedrock unless a site specific geotechnical report has been completed.

(b) The designed shorewall drawings prepared and sealed by Steimer are in compliance with the shorewall engineering design requirements of both By-law 2017.25 and By-law 2020.16. The drawings followed the engineering design requirements specifying that the design be completed and sealed by a professional engineer licensed in the Province of Ontario and were supported by a geotechnical engineering report as required.

(c) By-law 2020.16 does not preclude the use of vinyl sheet piling. Alternative materials are permitted if approved by a professional engineer.

(d) The illustrative shorewall drawings in By-law 2020.16 do not indicate that the concrete fascia panels are required for the structural integrity of the shorewall. The concrete fascia panels appear to be included simply for appearances or cosmetic purposes. Addition of the precast concrete fascia panels to a shorewall increase the cost of the shorewall to the owner above and beyond the cost necessary to provide a shorewall as defined in By-law 2017.25 and By-law 2020.16.

[146] During his submissions, the Applicants’ counsel referred to an expert report authored by Chris Metaxas of GEI Consultants, engaged by the Respondents. However, the report was not included in either party’s record. When the court inquired about whether it was being relied on, the Respondents’ counsel stated that he would not be referring to it. I draw the inference that the Metaxas report does not advance the positions taken by the Respondents.

Issues

[147] The parties submit the following issues to this court for determination:

(a) What is the test to quash a municipal by-law?

(b) Is the New By-law illegal because the subject matter of the New By-law is not within the Township’s powers?

(c) Is the New By-law illegal because it was passed in bad faith?

The Law

Test for Quashing a By-law

[148] By-laws enacted by municipal governments are presumed to be valid: Clublink Corporation ULC v. Oakville (Town), 2019 ONCA 827, 148 O.R. (3d) 558, at para. 31. The onus is on the Applicants to prove the basis upon which they should be quashed.

[149] Section 273(1) of the Municipal Act provides that the Superior Court of Justice may quash a by-law of a municipality in whole or in part for illegality. While this power is discretionary, the discretion must be exercised judicially and in accordance with established principles of law: London (City) v. RSJ Holdings Inc., 2007 SCC 29, [2007] 2 S.C.R. 588, at para. 39.

[150] “Illegality” is a broad term that encompasses any non-compliance with the law and is determined on a standard of correctness: RSJ Holdings, at paras. 35, 37.

[151] Where there is a total absence of jurisdiction for a by-law, a court acting judicially will quash it. But illegality is not strictly confined to matters of jurisdiction. A failure to comply with statutory procedural requirements may also provide sufficient grounds for quashing: RSJ Holdings, at para. 40.

[152] Overall, a number of factors may inform the court’s exercise of discretion including, the nature of the by-law, the seriousness of the illegality committed, its consequences, delay, and mootness: RSJ Holdings, at paras. 39-40.

[153] Bad faith is also a ground for quashing a by-law: Clublink, at para. 22; Grosvenor v. East Luther Grand Valley (Township), 2007 ONCA 55, 84 O.R. (3d) 346, at para. 39.

[154] The exercise is not for the court to substitute its own views of what it believes to be in the best interest of the public for that of municipal council: Municipal Parking Corp. v. Toronto (City) (2009), 314 D.L.R. (4th) 642 (Ont. S.C.), at para. 33.

Illegality

[155] Section 5(3) of the Municipal Act provides that municipal power shall be exercised by by-law unless a municipality is specifically authorized to do otherwise.

[156] However, a municipality’s authority in making by-laws is limited to the powers provided to it by the provincial legislature. By-laws are subordinate legislation and any that are inconsistent with the general provincial legislation “are void and of no effect, or else superseded to the extent that the legislature has acted”: Wpd Sumac Ridge Wind Inc. v. Kawartha Lakes (City), 2015 ONSC 4164, 43 M.P.L.R. (5th) 91, at para. 25.

[157] As stated at paragraph 19 of Wpd Sumac:

The question is not whether the by-laws fall within the scope of the Municipality’s authority to regulate, but rather whether the by-laws conflict with a provincial instrument.

[158] A court must therefore look to the purpose and wording of the enabling legislation when deciding whether, and the extent to which, a municipality has been empowered to pass a certain by-law. In carrying out this exercise, the modern approach to statutory interpretation is that “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 [the legislator]”: Clublink, at para. 34, citing Rizzo & Rizzo Shoes Ltd. (Re), [1988] 1 S.C.R. 27, at para. 21.

[159] As stated by Doherty J.A. in Barrick Gold Corp. v. Ontario (Minister of Municipal Affairs and Housing) (2000), 51 O.R. (3d) 194 (C.A.), at para. 64:

While individuals may order their affairs to comply with the letter, if not necessarily the spirit, of legislation, municipalities must bring themselves within both the spirit and the letter of the empowering provincial legislation. A by-law that finds its statutory justification in specific provincial legislation must be consistent with both the policy and the language of that legislation. A by-law that offends the policy underlying the operative statute is beyond the powers of a municipality and is, therefore, illegal within the meaning of s. 136 of the Municipal Act.

[160] The court must not second-guess the municipality as to whether the by-law will be effective in achieving the intended purpose or purposes: Toronto Taxi Alliance Inc. v. Toronto (City) (2005), 77 O.R. (3d) 721 (C.A.), at para. 46; Cash Converters Canada Inc. v. Oshawa (City), 2007 ONCA 502, 86 O.R. (3d) 401, at para. 23.

[161] Where the purpose for which a by-law is enacted is to accomplish indirectly an object that is beyond council’s authority, it is illegal and may also amount to bad faith: Grosvenor, at para. 39.

[162] As stated by Rogers in the Law of Canadian Municipal Corporations, 2nd ed. (Toronto: Thomson Reuters Canada, 1988) (loose-leaf 2024-Rel. 11), at §24.31:

A by-law which is ostensibly within the authority of a council to enact may be set aside or declared invalid if its real purpose and intent is to accomplish by indirect means an object which is beyond its authority… Hence, the court must always “in examining a by-law, see that it is passed for the purpose allowed by the statute and that such purpose is not resorted to as a pretext to cover an evasion of a clear statutable duty”.

[163] Council must observe the rules of natural justice by ensuring procedural fairness in its decision-making. This includes providing adequate notice, appropriate disclosure, and a meaningful right to be heard: Fortin v. Sudbury (City), 2020 ONSC 5300, at para. 103.

[164] When a municipal government improperly acts with secrecy, the democratic legitimacy of its decision is undermined. Even when those decisions are intra vires, they are less worthy of the deference that courts must show to the democratic decision-making process of elected municipal officials: RSJ Holdings, at para. 38.

Bad Faith

[165] Section 272 of the Municipal Act provides that a by-law passed in good faith under any act shall not be quashed or open to review, in whole or in part, by the court because of the unreasonableness or supposed unreasonableness of the by-law.

[166] By-laws are presumed to have been enacted in good faith. An applicant bears the onus of establishing bad faith, and it is a high burden to meet: Seguin (Township) v. Hamer, 2014 ONCA 108, at para 5.

[167] As stated by Southin J.A., “courts should be slow to find bad faith in the conduct of democratically elected representatives acting under legislative authority, unless there is no other rational conclusion”: MacMillan Bloedel Ltd. v. Galiano Island Trust Committee (1995), 10 B.C.L.R. (3d) 121 (C.A.), at para. 178, cited in Uukkivi v. Lake of Bays (Township) 2004 CarswellOnt 4494 (S.C.), at para. 32.

[168] In Toronto Taxi Alliance Inc. v. City of Toronto, 2015 ONSC 685, 33 M.P.L.R. (5th) 103 (“Toronto Taxi (ONSC)”), at para. 100, Stinson J. summarized bad faith to mean:

In the words of Laskin J.A. in Equity Waste Management (at para 61): “[b]ad faith by a municipality connotes a lack of candour, frankness and impartiality. It includes arbitrary or unfair conduct in the exercise of power to serve private purposes at the expense of the public interest.” When a Council acts in bad faith, it has “acted unreasonably and arbitrarily and without the degree of fairness, openness and impartiality required of a municipal government.” (Re H.G. Winton Ltd. and Borough of North York (1978), 20 O.R. (2d) 737 (Div. Ct.), at para. 21).

[169] As noted above, in Equity Waste Management of Canada Corp. v. Halton Hills (Town), (1997), 35 O.R. (3d) 321 (Ont. C.A.), at p. 340, the Ontario Court of Appeal adopted the following definition of bad faith:

Bad faith by a municipality connotes a lack of candour, frankness and impartiality. It includes arbitrary or unfair conduct and the exercise of power to serve private purposes at the expense of the public interest.

[170] Certain “badges” or indicia of bad faith might not individually constitute bad faith, but cumulatively may rise to such a level: Toronto Taxi (ONSC), at para. 106. Such indictors of bad faith include: “questionable timing; decisions made under false pretenses; improper motives; lack of notice; the usual practices and procedures are set aside; the parties most affected are kept in the dark; or the law singles out one individual or property”: Toronto Taxi (ONSC), at paras. 106, 108; Fortin, at para. 175.

Discussion

Illegality

[171] The governing Mara Act established the limits of the Township’s authority with respect to any lands that are conveyed to it by the owners of land abutting a canal, specifically the easement on which the shorewalls were constructed or to be constructed, maintained, and repaired, and the adjacent waterway. The powers granted to the council under s. 2(1) of the Act include the power to manage, maintain, regulate and control any land or easement conveyed to it.

[172] The preamble to the Mara Act notes that one of the primary purposes for its enactment is the establishment of the local board, referenced in s. 3 as the Lagoon City Parks and Waterways Commission. As stated in s. 3, the role of the Commission is to manage, maintain, regulate and control lands and easements conveyed.

[173] While the language in s. 3 regarding council’s authority to pass a by-law to establish the Commission is permissive, a reading of the Mara Act in its entirety leads to the conclusion that the Commission was intended to be integral to the governance of Lagoon City. The Mara Act details the governance structure of the Commission, including requiring that it consist of three members of the public who are owners or tenants of lands abutting a canal, and details the procedural requirements of the Committee’s business, including annual reporting and auditing requirements.

[174] While by-laws respecting shorewalls are for council to enact, the Committee is to exercise the powers granted under s. 7(3) where an owner fails to construct or maintain a shorewall in accordance with a by-law. These powers are significant, as they allow the Commission to construct or repair the shorewall at the owner’s expense, subject to it following the procedures required by the Act.

[175] There is nothing in the Mara Act that authorizes the Township or the Committee to demand that hundreds of residents shoulder the cost of concrete fascia and caps on shorewalls for purely aesthetic reasons. The shorewalls exist for the primary purpose of preventing erosion between the lands and the canals.

[176] The importance of the Commission cannot be understated. As the evidence on this application shows, shorewalls are an integral part of Lagoon City, and their design and repair require specialized expertise. In its wisdom, the Legislature in enacting the Mara Act envisioned a committee which, while its members would not be required to have specialized expertise, would be focused on the shorewalls as part of the land or easements conveyed to the Township. The Commission is and was intended to be a separate and independent body from the Township. To recognize that the management, maintenance regulation and control of the shorewalls (and other lands conveyed) should be carved out of the Township’s other business, the Township was authorized to delegate any or all of those powers to the Commission to under s. 5(1) of the Mara Act.

[177] Recognizing this key feature of the Mara Act, and the importance of the Commission to Lagoon City as a whole, this is exactly what the Township did when it enacted earlier by-laws that gave enforcement powers over shorewalls to the Commission. For example, at s. 7.1 of By-law 97.54, the powers delegated to the Commission were set out as follows:

7.1 In the event that any owner fails to construct or maintain the portion of shorewall for which that owner is responsible in a state of repair satisfactory to the Lagoon City Parks and Waterways Commission, the said Commission may exercise its powers and privileges set out in the Act to compel the said owner to construct or repair the shorewall for which he or she is responsible, and, if necessary, in accordance with the provisions of the Act, to perform the said construction or repair and to collect the cost of so doing in accordance with the provisions of the Act.

[178] The Act referred to in s. 7.1 is the Mara Act, as set out in the preamble to By-law 97.54. This same provision was included in By-law 2020.16.

[179] The Legislature saw fit to ensure that an owner who objected to the necessity of a repair, or its cost, had an opportunity to be heard by the Commission. Importantly, the Mara Act also allows for a right of appeal if the Commission rejects the owner’s submissions. As earlier outlined, the issue of the cost of repair is a central focus of the provisions in the Mara Act, both for the Commission and the court of revision hearing an appeal. Subsections 7(3)(a) and (b)(i) of the Mara Act require that the Commission include in the notice both the nature of the work proposed and an estimate of its cost, and to give the owner the opportunity to make representations to the Committee not only on the necessity of repair, but also the cost of construction or repair of the proposed work (emphasis added).

[180] The Committee is also required under subsection 7(5) to hold off on taking any further steps on the shorewall in question until an owner has exhausted their appeal rights.

[181] I find that part of the Committee’s purpose and mandate given under the Mara Act was to give due consideration to the cost of building, maintenance, and repair of shorewalls. The obvious financial interest of the owners was recognized by giving three out of five seats on the Committee to owners or tenants who would be affected by the Committee’s decisions.

[182] However, By-law 2020.16 stripped away certain procedural and substantive rights provided by the Mara Act.

[183] The first of these is found in s. 3.1. Pursuant to s. 3.1(a) of By-law 2020.16, the Commission is to provide notice to the owner outlining the nature of the work required to repair or replace the shorewall (emphasis added). In the event of a notice of repair or replacement being sent by the Commission to an owner, s. 3.1(b) provides that the Commission will provide the owner the opportunity to make oral or written representation to the Commission as to the necessity of repair or replacement of the shorewall (emphasis added). Absent from these provisions is any mention of cost or expense, which I find to have been a deliberate omission, and is contrary to the wording in the Mara Act.

[184] As indicated, I find that this omission was deliberate. By the time that By-law 2020.16 had been enacted, the Commission and the Township had received a significant amount of information about the increased cost of the concrete coping and fascia that as much as doubled the quotes provided for the Applicants’ proposed material. The Respondents had been hearing about the Phase One Group’s concerns about cost for some time. Several of the questions posed by Ken Jennings related to the Commissions’ consideration of cost to owners, and only the month before Jennings’ deputation had been presented at the Township council meeting. The Respondents were aware that the type of design being proposed by the Applicants had a substantial impact on the cost of construction or repair of the shorewalls. By deleting any reference to cost, the Township attempted to make the expense a moot consideration in the analysis. Even in the face of the email from Councillor Snutch that raised the issue of increased cost, the Township passed By-Law 2020.16 and thereby attempted to make the amount of the associated expense irrelevant.

[185] The purported authority to ignore cost given to the Commission by By-law 2020.16 is further underscored by s. 3.1(c), which provides that the Commission will give judgment of their decision within 30 days as to the necessity of the identified repair or replacement of the shorewall (emphasis added).

[186] There is no rational connection between the terms of the Mara Act and the requirement for a concrete façade. Again, the provisions of the Mara Act indicate that cost is a valid consideration for the Commission. All available engineering evidence, which I accept, is that there is no valid engineering reason for the concrete, and that, in fact, it is a detriment. It requires corrosive components and reinforcement to support its added weight and contributed to the degradation of some of the walls. This was made clear to the Commission as early as 2016, when it received Tatham’s initial report. Concrete adds additional cost for nothing but cosmetic reasons. The requirement of concrete façades imposed by the New By-law is not necessary in the public interest.

[187] The second procedural and substantive right that was removed by By-law 2020.16 was the process of appeal. The Mara Act mandates a robust appeal process. In contrast, By-law 2020.16 provides, at s. 3.1(d):

After affording the Owner an opportunity to make submissions and having released its decision, the decision of the Commission with respect to the necessity of any repair or replacement of the shorewall is final.

[188] Again, the finality of the Commission’s decision is contrary to the governing Mara Act. The amending by-law, By-law 2020.57, goes even further, removing all powers from the Commission set out in s. 3.1 of By-law 2020.16, and transferring them to the Township. By-law 2020.57 removes all references to the Commission that were contained in By-law 2020.16.

[189] The Commission has sole jurisdiction to exercise the powers that are granted to it under the Mara Act, not the Township. The New By-law effectively guts the powers of the Commission and transfers all its former authority to the Township.

[190] The preamble to By-law 2020.57 states, in part:

AND WHEREAS the Council of the Corporation of the Township of Ramara deems it necessary to amend Bylaw 2020.16 to provide for the Township to administer the shorewall bylaw and to provide for appeals to the bylaw to the Township’s Appeals Committee as opposed to the Lagoon City Parks & Waterways Commission.

[191] The Township has the clear authority under s. 2(c) of the Mara Act to enact by-laws for the purpose of managing, maintaining, regulating, or controlling any land or easement conveyed to them, including the shorewalls. However, it must not enact any by-law for a collateral purpose. The Township cannot enact a by-law for a purpose other than that envisaged by its empowering statute. In this case, I find that the Township passed the New By-law so that Council and the Committee’s desire to ensure that concrete fascia and capping was a required design element be achieved, regardless of the cost to the owners, and to remove from the Committee any decision-making authority to avoid having to render a decision on the outstanding appeal. The Township did so knowing that former By-law 2017.25 would require the Committee to grant the appeal in favour of the Appellants, and that the permit applications would likewise have no basis to be rejected unless the existing By-law was changed.

[192] Mr. Ewart made the argument that the actions of the Committee are to be distinguished from the conduct of Council. Respectfully, that cannot be done in the circumstances of this case, as there is too much evidence that the Township’s decision to pass the New By-Law was done in counterpart with the Commission’s wishes.

[193] Grellette’s clear evidence, at paragraph 28 of his affidavit, is that following the appeal hearing in March 2019, “Municipal Council and the Commission undertook a review of By-law 2017.25 which resulted in the passage of By-law 2020.16 on February 10, 2020”.

[194] If that were not enough, the information contained in Brittain’s email to Mr. Ewart dated June 11, 2019, providing him with the background to this dispute, leaves no doubt about the intention of the Commission and the Township. She wrote that the Commission is looking for recommendations on how to amend By-law 2017.25 “to give authority and to remove ‘loopholes’”, because, as she also wrote, the current state of By-law 2017.25 did not prevent the Committee from barring the shorewall building permit (the only application submitted at that point being the Jennings). She admitted that the Chief Building Official had not issued the permit because he knew that the Commission did not want it issued. The content of this email also left no doubt about why that was the case: “The members of the [Committee] initially were not in favour of the design as it is made of plastic rather than concrete. The members want a unified design for shorewalls - much like a curb in a neighbourhood”.

[195] The blending of the Commission and Council is dictated by s. 4 of the Mara Act, which provides that the Commission must be comprised of two members appointed from council and three owners. Minutes of a Commission meeting held on November 23, 2018 indicate that the two positions allocated to Council were filled at that time by the Deputy Mayor, John O’Donnell, and Ward 5 Councillor, Kal Johnson. The evidence that was uncovered from Jennings’ MFIPPA application shows that Johnson was a particularly vocal opponent of the Applicants’ permit application.

[196] I note also that the notices that were sent out to the Appellants by the Commission were sent on the Township’s official letterhead, and that Brittain’s administrative position serves both Council and the Committee.

[197] The serious impact and financial consequences of the New By-law required that the Township be scrupulously transparent about what it was doing, and to allow full opportunity for public participation. As Jennings’ evidence points out, By-law 2020.16 was passed before the May long weekend, when about two-thirds of Lagoon City’s population had not returned to their seasonal residences. That was also the case with By-law 2017.25. While By-law 2017.25 is not in issue, there is a trend that demonstrates a lack of democratic fairness. By-law 2017.25 was passed even before the Committee’s minutes had been published from the meeting during which it had discussed the by-law amendments. There was little possibility that members of the public could have been adequately informed of Council’s intentions.

[198] Significantly, there is no evidence that there was any advance notice of By-law 2020.16 beyond posting it on a website that had just been created. The Respondents’ evidence does not dispute this fact. Although Grellette’s affidavit baldly refers to the public being provided with an opportunity to make comment on the draft legislation before its passage, no explanation was provided about how that process took place. It seems that it was the Applicants and other members of the Phase One Group that circulated the word about the proposed by-law, not Council or the Committee. A large percentage of seasonal residents would not have been present at the relevant time in January and February 2020, when deputations and submissions were being made to the Township prior to By-law 2020.16 being enacted on February 10.

[199] That the Township did not wait until it had further information about the increased costs of adding concrete to the synthetic sheet piling underscores its agenda. In his email sent just two days before the enactment of By-law 2020.16, Councillor Snutch questioned why council could not delay until they had accurate numbers regarding the extra cost of enforcing a concrete top and fascia for cosmetic purposes only. After receiving a response from Councillor/Commissioner Johnson that was not responsive to his question, Councillor Snutch sent a further email that said “I am only looking for the answer to one question. How much extra per foot to have a concrete slab and facing install for cosmetic purposes only”.

[200] There is no evidence that his question was answered, until after By-law 2020.16 was enacted and T&C’s quotation, which is noted to have been prepared specifically for Johnson, showed an additional cost of $34,000 for the addition of concrete for every shorewall.

[201] This further evidence leads to the inescapable conclusion that the Respondents were prepared to ignore the issue of cost and wanted the By-law to be pushed through. And instead of reconsidering By-law 2020.16 after they had that final confirmation of increased cost, they further encroached on the Applicants’ rights by passing the amending by-law. By that time, the evidence shows that the building department was looking for direction, the Applicants and Steiner were continuing to press for an answer, and the Respondents were looking for a way to have the shorewall building permits rejected due to by-law non-compliance.

[202] The Respondents’ actions are lacking in the impartiality required of elected officials. Cloaked in the mantle of their public office, both Committee and Council members passed the New By-law to meet their own goals of a certain aesthetic, and to silence the opposition received from the Phase One Group.

[203] In conclusion, both By-law 2020.16 and 2020.57 should be quashed. The Township acted outside of its authority in enacting the By-laws for purposes at odds with those outlined in the Mara Act for enacting by-laws, to accomplish an improper purpose. The significant deference that should be afforded to decisions of municipal council should not apply here. Further, the need for deference is eroded by the manner in which By-law 2020.16 was enacted, with elements of procedural unfairness that undermine its democratic legitimacy.

[204] The expert evidence provided by Kohlberg is that the designed shorewall drawings prepared and sealed by Steimer comply with the shorewall engineering design requirements of By-law 2017.25. The Respondent’s have offered no contrary evidence. Further, the Conservation Authority has granted its permission. There is no reason, on the evidence, to not grant the Applicants’ request to compel the Township to grant the shorewall permits.

Bad Faith

[205] If I am wrong in that reasoning or conclusion, I would nonetheless quash the New By-law due to it being enacted in bad faith.

[206] There are multiple “badges” of bad faith on the part of the Respondents demonstrated by the evidence. Together, these indicia collectively lead to the inescapable conclusion that the Respondents have acted unfairly, oppressively, and with bias to satisfy the aesthetic preferences of some members of Council and the Committee, at what will be a significant cost to the some 876 shorewall owners within Lagoon City.

[207] Without unduly repeating the evidence, the hallmarks of bad faith that exist here are:

(a) the collusion between members of the Council and the Commission to achieve their members’ mutual goal of a certain aesthetic;

(b) issuing notices of default to some of the Applicants when they were actively engaged in a process to remediate their shorewalls;

(c) enacting a by-law containing requirements for shorewalls that had no basis in sound engineering practices, while being aware of professional advice to the contrary;

(d) enacting a by-law that was detrimental to the public’s financial interest and without consideration of that cost, contrary to the intent of the Mara Act;

(e) failing to give due process to the Applicants by prohibiting the professionals engaged by the Phase One Group to present information about their shorewall design to the Committee;

(f) interfering with the independence of another municipal officer, namely the chief building officer;

(g) colluding to withhold the appeal decision for an indeterminate time;

(h) spending public funds on legal counsel and advice with the pre-determined objective of achieving personal preferences of the elected officials;

(i) enacting By-law 2020.16 on the pretense that it resolved “ambiguity” in By-law 2017.25 when no such ambiguity existed;

(j) proactively creating by-laws with the goal of defeating the Applicants’ shorewall building applications;

(k) proactively enacting a by-law with the goal of circumventing the need to issue a decision to the Appellants, which would otherwise have ended the Commission’s enforcement proceeding; and

(l) enacting By-law 2020.16 with questionable timing and a questionable amount of public notice.

Ruling

[208] For the foregoing reasons, this court orders and declares:

1. Township of Ramara By-law 2020.16 A By-law Regarding the Construction and Replacement of Shorewalls Within the Development Known as Lagoon City as amended by By-law 2020.57 (the “New By-law”) is contrary to provincial statute.
2. The New By-law was enacted in bad faith.
3. The New By-Law is hereby quashed on the basis that it is contrary to provincial statute and enacted in bad faith.
4. By-law 2017.25 is hereby in full force and effect.
5. The Township shall forthwith grant the applications submitted by the Applicants for permits to replace the shorewalls abutting their respective properties; and
6. The Commission shall forthwith render a decision as to the necessity of repair or cost of construction or repair of the proposed works.

Costs

[209] The Applicants are presumptively entitled to the costs of this application as the successful parties.

[210] If the parties are unable to agree upon the issue of costs within 20 working days from the date of release of these Reasons, they may make submissions in writing. The Applicants’ submissions are due on January 31, 2025, the Respondents’ on February 14, 2025 and any reply, if necessary on February 19, 2025. These deadlines may be extended by mutual agreement of counsel, with notice to the court through my judicial assistant at BarrieSCJJudAssistants@ontario.ca.

[211] Written submissions are limited to 5 double-spaced pages, plus a Bill of Costs or Costs Outline. All authorities relied on are to be hyperlinked in the document or uploaded to Case Center with a tabbed (i.e., hyperlinked) index. The submissions are to be filed with the court, with a copy emailed to my judicial assistant, in addition to being uploaded to Case Center.

The Honourable Madam Justice S.E. Healey

Released: December 30, 2024