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Expropriations (Ont) - Expropriations Act (EA). 1353837 Ontario Inc. v. The Corporation of the City of Stratford
In 1353837 Ontario Inc. v. The Corporation of the City of Stratford (Div Ct, 2026) the Divisional Court dismissed an appeal, here brought against a "costs award ... of the Ontario Land Tribunal (the “Tribunal”) under s. 32(2) of the Expropriations Act, R.S.O.1990, c.E.26 (the “Act”)".
Here the court extensively considers the tribunal's costs award, and - interestingly - the [then] adoption (in the tribunal's Rules) of cost aspects of the civil Rules of Civil Procedure [R49]:[22] The relevant portions of the Act that were under consideration are as follows:32 (1) Where the amount to which an owner is entitled upon an expropriation or claim for injurious affection is determined by the Tribunal and the amount awarded by the Tribunal is 85 per cent, or more, of the amount offered by the statutory authority, the Tribunal shall make an order directing the statutory authority to pay the reasonable legal, appraisal and other costs actually incurred by the owner for the purposes of determining the compensation payable, and may fix the costs in a lump sum or may order that the determination of the amount of such costs be referred to an assessment officer who shall assess and allow the costs in accordance with this subsection and the tariffs and rules prescribed under clause 44 (d). 2017, c. 23, Sched. 5, s. 35.
(2) Where the amount to which an owner is entitled upon an expropriation or claim for injurious affection is determined by the Tribunal and the amount awarded by the Tribunal is less than 85 per cent of the amount offered by the statutory authority, the Tribunal may make such order, if any, for the payment of costs as it considers appropriate, and may fix the costs in a lump sum or may order that the determination of the amount of such costs be referred to an assessment officer who shall assess and allow the costs in accordance with the order and the tariffs and rules prescribed under clause 44 (d) in like manner to the assessment of costs awarded on a party and party basis. 2017, c. 23, Sched. 5, s. 35. ....
Standard of Review
[40] Section 31 of the Act provides that an order of the Tribunal may be appealed to this court on a question of law or fact or both.
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[42] As to the exercise of the Tribunal’s discretion in ordering costs, the exercise of discretion is not reviewed on a correctness standard and is afforded significant deference: see Shergar at para. 22 and Popack v. Lipszyc (2016), 129 O.R. (3d) 321, [2016] O.J. No. 857, 2016 ONCA 135 (C.A.), at para. 25.
[43] The Court of Appeal in Shergar (decided post-Vavilov) continued to rely on the reasoning set out in Popack which held that discretionary orders under appeal involve balancing of competing interests.In most cases, the existence of a discretion implies that different judges can reasonably arrive at different results. Consequently, appellate courts will defer to the exercise of discretion at first instance absent a clearly identifiable error in the application of the law, a material misrepresentation of the relevant evidence, or a result that is clearly wrong in the sense that it is not defensible on the application of the relevant law to the facts. ... [44] The Court of Appeal in Konig v. Hobza, 2015 ONCA 85 at para. 44 confirmed that the Supreme Court of Canada in Hamilton v. Open Window Bakery Ltd., 2004 1 S.C.R. 303, 2004 SCC 9 at para. 27 made it clear that an appellate court will not interfere with discretionary costs awards generally unless the award reflects an error in principle or is plainly wrong.
[45] Courts have confirmed that it will intervene in costs decisions of other administrative tribunals only if the tribunal made an error in principle or its decision was plainly wrong. Casella v. Ontario College of Chiropodists, 2024 ONSC 899 at para. 27; Kitmitto v. Ontario (Securities Commission), 2024 ONSC 1412 at para. 170; Kennedy v. College of Veterinarians, 2018 ONSC 3603 at para. 24; The Law Society of Upper Canada v. Watson, 2026 ONCA 372 at para.38
[46] 135 submits that the Tribunal’s costs decision is also subject to significant deference by reason of s. 13(4) of the Ontario Land Tribunal Act, 2021, S.O., c.4 which provides as follows:13(4) Unless the Tribunal’s failure to comply with the rules, or its exercise of discretion under the rules in a particular manner, causes a substantial wrong that affects the final disposition of the proceeding, neither the failure nor the exercise of discretion is a ground for setting aside a decision of the Tribunal on an application for judicial review or on appeal. [47] The “rules” referred to in s. 13(4) in our view refer to the practice and procedural rules the Tribunal is authorized to implement under s. 13(1) which provides as follows:13(1) The Tribunal may make rules governing its practices and procedures, including rules that,
a) provide for and require the use of hearings or of practices and procedures that are alternatives to traditional adjudicative or adversarial procedures;
b) provided for specified circumstances in which participation in mediation or other dispute resolution processes by parties to a proceeding is mandatory;
c) provide for and require notice to be provided in any particular manner;
d) authorize the Tribunal to combine two or more proceedings or any part of them, or hear two or more proceedings at the same time;
e) authorize a Tribunal to appoint a person from among a class of parties to a proceeding to represent the class where, in the opinion of the Tribunal, the parties have a common interest; or
f) govern the making of orders under section 10 and the exercise of powers under the orders. [48] The Tribunal’s costs award under appeal before this Court was not made in the exercise of its discretion under its practice and procedure rules but rather under s. 32 (2) of the Act, as set out above and therefore s.13(4) does not apply.
[49] Accordingly, I have considered this appeal from the Tribunal’s costs award on the basis of whether the Tribunal made an error in principle or was plainly wrong.
Analysis
[50] The City’s position is that the Tribunal erred in the interpretation and application of Rule 49.10. Rule 49.10 (2) of the Rules of Civil Procedure provides that where a defending party achieves a better result at trial than the amount of its Rule 49 offer, the plaintiff is entitled to its partial indemnity costs to the date of the offer and the defending party is entitled to its costs incurred from the date of the offer forward, unless the court orders otherwise.
[51] The City submits that because the City’s offers to settle exceeded the ultimate compensation award and because of 135’s unreasonable conduct and failure to accept the City’s offers, the Tribunal ought to have awarded the City its costs of the entire proceedings and disentitle 135 to any of its costs.
[52] The City submits that the Tribunal departed from a long line of Rule 49 cases without a principled basis in making what it states was an unprecedented order of costs, which nullifies the effectiveness of Rule 49 offers as a reliable tool to encourage settlement. For the reasons below, I disagree.
[53] The Tribunal, following Shergar, properly recognized the differences between the costs regimes for civil proceedings and expropriation proceedings, balancing the indemnity principle and the efficiency principle as noted above.
[54] Rule 26.29 of the Ontario Land Tribunal Rules of Practice and Procedure states that if an offer to settle is made and is not dealt with in the Act, the Rules of Civil Procedure apply.
[55] A similar provision was applicable at the time of the Shergar decision under r. 141 of the Ontario Municipal Board Rules.
[56] The City in its factum referred to the jurisprudence dating back to 1976 in Re Rotenberg et al. and Borough of York (No.2) 1976 Canlii 735 (Ont. C.A.) whereby the courts and the Tribunal have applied the costs framework of Rule 49.10 to expropriation cases including awarding costs, usually on a solicitor client basis, to the date of the municipality’s settlement offer.
[57] The facts in Shergar also involved a claimant’s unreasonable conduct in delaying the compensation proceeding and its refusal to accept the City’s offer of compensation that far exceeded the ultimate award made. Similar to the Tribunal decision in Shergar, the Tribunal in this case awarded costs to 135 on a solicitor-client basis until the date of the City’s Rule 49 June 15, 2018, offer in keeping with the jurisprudence under the Act.
[58] The Tribunal in this case noted that the Tribunal in Shergar did not apply Rule 49.10, which would have provided that Shergar receive only partial indemnity costs to the date of the City of Windsor’s Rule 49 settlement offer, and that the City receive its partial indemnity costs from that date forward. That reasoning and decision was upheld by this Court and the Court of Appeal at para. 38. The Tribunal in this case similarly concluded it was entitled to draw upon Rule 49.10 (2) to inform its analysis, but it need not or should not follow it rigidly or formulaically.
[59] This Court in Shergar at paras. 105 and 106 confirmed that the Tribunal’s discretionary authority to award costs under ss. 32(1) and 32(2) is not constrained or fettered in any manner nor does any conflict arise between the terms of these provisions and Rules 49.10 and 57.01.
[60] Accordingly, there was no error in principle in the Tribunal’s award to 135 of its solicitor-client costs up to and including the date of the City’s Rule 49 June 15, 2018, offer nor was that decision plainly wrong.
[61] I come to the same conclusion with respect to the Tribunal’s decision to award 135 its costs on a partial indemnity basis after the date of that offer.
[62] As noted above, the Tribunal’s discretion to make that costs award was not constrained or fettered in any manner. It considered, but in its discretion, departed from the provisions of Rule 49.10, finding that 135 should only be entitled to partial indemnity costs thereafter because of its unreasonable conduct rather than no costs. The Tribunal also ordered that the City was entitled to its costs on a partial indemnity basis for the entire proceeding, not just from its June 15, 2018, settlement offer.
[63] It did so for two reasons. The first was on the basis that 135’s refusal to accept the City’s proper settlement offer of June 15, 2018, and its unreasonable conduct throughout the proceeding were not as egregious as the facts in Shergar such that it should be denied any costs after that date.
[64] That reason should not be considered in isolation. The second and perhaps more significant reason was because the Tribunal found it was more appropriate to address and effectively sanction 135’s unreasonable and wasteful conduct by awarding the City its costs payable by 135 throughout the entire proceeding on a partial indemnity basis and not just from the date of its Rule 49 offer of June 15, 2018.
[65] Rule 49.10 (2) would not normally allow the City its costs before the date of its June 15, 2018, offer. The Tribunal found that it was objectively reasonable for 135 not to accept the City’s first September 11, 2009 offer as it was made jointly to 135 and four other entities, it was unclear and deficient given the mathematical error, and 135’s expert report was extremely critical of the City’s Bower Appraisal including the amount of the cost of remediation being significantly less. In addition, that offer made before the commencement of the expropriation proceeding would not be an offer that falls within this Rule. Scanlan v. Standish, (2001) 2002 CanLII 20549 (ON CA), 57 O.R.(3d) 767, 155 O.A.C. 96 (C.A.).
[66] The second January 13, 2010, offer of the City was not a final offer and was subject to adjustment and reimbursement by 135 if the compensation award was less than the amount advanced. The City’s June 27, 2013, offer was revoked in October 2017.
[67] The City has not established any error in principle or that the Tribunal’s decision was plainly wrong in its finding that 135’s conduct resulting in delays in the expropriation proceedings was less egregious compared to the facts found in Shergar. There was adequate support for those findings on the evidence before it. The Tribunal noted that the initial Vice Chair Jacobs’ decision found that the delays in the proceedings were occasioned by both parties, not just 135, as well as delays beyond the control of either of them or the Tribunal. The Tribunal noted that the strong opposing forces of the parties prevented an expeditious conclusion of the lis between them.
[68] The Tribunal recognized at para. 140, as conceded by 135, that all the aggravating factors in Shergar need not be present before costs are not awarded to 135 and/or against it in favour of the City. In my view, the Tribunal did not conclude as the City submitted, that 135 could only be denied costs after the City’s June 15, 2018, offer under Rule 49.10 if the facts were as egregious as those in Shergar.
[69] Rather, what is apparent is that the Tribunal decided it was more appropriate in this case to address 135’s unreasonable conduct by awarding 135 its costs after the June 18, 2018 offer on a reduced partial indemnity basis but at the same time requiring 135 to pay the City’s costs on a partial indemnity basis from the outset until the date of that offer and also thereafter for the balance of the proceeding.
[70] The result in effect required 135’s entitlement to only partial indemnity costs after the date of that offer to be offset to some extent by its obligation to pay the City’s partial indemnity costs incurred before that date because of its unreasonable conduct, neither of which was normally contemplated by Rule 49.10.
[71] Accordingly, the Tribunal did consider the unreasonable conduct of 135 throughout the proceeding including not accepting the City’s Rule 49 offers of June 15, 2018, and April 13, 2021, and, in its discretion, reasonably sanctioned 135 by making the costs order it did.
[72] Lastly, the City did not object to the submissions that the Tribunal had discretion to award costs concurrently to both 135 and the City and on their respective costs motions.
[73] I find the City has not established that the Tribunal’s costs decision falls outside of the range of possible acceptable outcomes which are defensible in respect to the facts and law.
[74] The Tribunal in its discretion was entitled, on the evidence before it, to address the issue of 135’s unreasonable conduct when assessing costs under s. 32(2) of the Act by reducing its post June 15, 2018 costs to partial indemnity costs only, and simultaneously requiring 135 to pay the City’s costs throughout the entire proceeding on a partial indemnity basis.
[75] The Tribunal’s decision is to be afforded significant deference even though this Court or other Tribunal members could have reasonably arrived at a different result. I do not find that the discretionary costs award reflects an error in principle or is plainly wrong. . City of Ottawa v. MacEwen Petroleum Inc.
In City of Ottawa v. MacEwen Petroleum Inc. (Ont Div Ct, 2026) the Ontario Divisional Court allowed an appeal, this regarding "whether a business claiming compensation for the expropriation of property was entitled to interest on legal fees prior to the date of the tribunal order fixing its legal costs".
The entire case [34 paras] is relevant to issues of administrative tribunal jurisdiction over interest and costs in the Expropriations Act (Ont) context.
. New Sunlight Inc. v. Minister of Infrastructure
In New Sunlight Inc. v. Minister of Infrastructure (Fed CA, 2025) the Divisional Court of Ontario dismissed a motion to compel examination of a witness, this within a JR "challenging the Ministry of Infrastructure’s plan to expropriate its two properties for several public infrastructure projects".
Here the court considers procedures under the Ontario Expropriations Act:[1] The applicant has brought an application for judicial review challenging the Ministry of Infrastructure’s plan to expropriate its two properties for several public infrastructure projects. The current application challenges two notices of application for approval to expropriate (NOAs), one in relation to each parcel of land. The applicant previously sought review of two Orders in Council relating to the expropriations. That application was dismissed in this court (New Sunlight Inc. v Ontario (Minister of Infrastructure), 2025 ONSC 638). Leave to appeal that decision has been granted by the Court of Appeal. . New Sunlight Inc. v. Ontario (Minister of Infrastructure)
In New Sunlight Inc. v. Ontario (Minister of Infrastructure) (Ont Divisional Ct, 2025) the Divisional Court dismissed a JR "seeking to set aside two pieces of subordinate legislation issued by the Lieutenant Governor in Council", here respecting a Toronto transit expropriation and a designation under the Transit-Oriented Communities Act, 2020.
Here the court considers related aspects of the Expropriation Act:Ministry of Infrastructure Act (“MIA”)
[12] The MIA provides two avenues by which the Minister may expropriate land under ss. 10 (1) and (2):Expropriation
10 (1) Subject to the Expropriations Act, the Minister, for and in the name of the Crown, may, without consent of the owner, enter on, take and expropriate any land or interest in land that the Minister considers necessary for the use or purposes of the Government.
Lieutenant Governor in Council direction
(2) Subject to the Expropriations Act, the Minister, on the direction of the Lieutenant Governor in Council, for and in the name of the Crown, shall, without consent of the owner, enter on, take and expropriate any land or interest in land that the Lieutenant Governor in Council considers necessary for the benefit of the public. Expropriations Act (“EA”)
An expropriation process is commenced by an expropriating authority serving a Notice of Application for Approval to Expropriate (“Expropriation Notice”) pursuant to s. 6 of the EA. A landowner served with such Notice may request a hearing of necessity before the Ontario Land Tribunal (“OLT”) pursuant to s. 6(2) (unless the land has been designated as TOC land under s.3(1) of TOCA). . Eric Levin Holdings Inc. v Ministry of Transportation
In Eric Levin Holdings Inc. v Ministry of Transportation (Div Court, 2023) the Divisional Court considered the interest rate that applies to expropriated property, counted "from the date the owner ceases to reside on or make productive use of the land" [EA 33(1)] - here where the landowner claimed both a rental and a development use (which claim was dismissed on the evidence):[3] Section 33(1) of the Act provides as follows:Subject to subsection 25(4), the owner of lands expropriated is entitled to be paid interest on the portion of the market value of the owner’s interest in the land …to which the owner is entitled outstanding from time to time, at the rate of 6 per cent a year calculated from the date the owner ceases to reside on or make productive use of the land. [4] In the case at bar, determining the date from which interest should run involved deciding two issues: (1) what was the productive use of the land and (2) when did that productive use cease.
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[11] Regarding the rate of interest to be paid, s. 33(4) of the Act provides:Where the Tribunal is of the opinion that any delay in determining compensation is attributable in whole or in part to the expropriating authority, the Tribunal may order the expropriating authority to pay to the owner interest under subsection (1) at a rate exceeding 6 per cent but not exceeding 12 per cent a year. [12] The Appellant argued before the Tribunal that the Respondent was responsible for delay in determining the compensation eventually agreed upon by the parties and sought interest at the rate of 12 percent. The Tribunal dismissed the Appellant's claim. It held that it would be unfair to permit the Appellant to seek interest at a rate higher than 6 percent because such a claim had never been pleaded.
[13] The Tribunal's decision in this regard was a discretionary one. Section 13(4) of the Ontario Land Tribunal Act, 2021, S.O. 2021, c. 4, Sched. 6, provides that, unless a Tribunal's failure to exercise its discretion causes a substantial wrong that affects the final disposition of a proceeding, the failure to exercise the discretion is not a ground for setting aside a decision of the Tribunal on an appeal. The Tribunal's refusal to permit the Appellant to pursue interest at a rate greater than 6 percent in this case caused no substantial wrong. As the Tribunal correctly pointed out, the Appellant had specified in three places in its claim that it was seeking interest "at 6 percent" and failed to take any steps to amend the claim in the process leading up to the hearing.
[14] Notwithstanding the Tribunal's refusal to allow the Appellant to pursue interest at 12 percent, the Tribunal went on to consider whether the Respondent was responsible for any delay. It held that both parties were responsible for the delay, as each approached the issue from a different perspective. The Tribunal's decision in this respect was a factual one and is subject to the palpable and overriding error standard of review. The Appellant has failed to establish any error, let alone an error of this nature. There was no error in concluding that both parties were responsible for the delay given that the amount of compensation eventually agreed upon represented a compromise between the parties' positions.
[15] Finally, the Appellant makes a claim for compound interest. The Appellant relies on this court's jurisdiction under s. 31(3) of the Act to make any order on an appeal that the Tribunal has the power to make to raise this claim for the first time on the appeal. Because it was raised for the first time before this court, the court did not have the benefit of the Tribunal’s view on the matter, which might well have been helpful since the Tribunal is an expert tribunal. This is important since compound interest is not mentioned in the Act and there is no Ontario authority that such a claim can be advanced. Arguments that were not advanced in the original hearing are not normally considered by an appellate court. In our view, this principle should be applied with respect to the Appellant’s claim for compound interest. . 1353837 Ontario Inc. v. The Corporation of the City of Stratford
In 1353837 Ontario Inc. v. The Corporation of the City of Stratford (Div Court, 2022) the Divisional Court heard an Expropriations Act [s.31] appeal from the Ontario Land Tribunal. In these quotes the court reviews some principles applicable to calculating the value of an expropriated property under the Expropriations Act:Compensation for Expropriation of the Property
[18] It is well-established that compensation payable under the Act may fall into four categories: market value, disturbance damages, damages for injurious affection, and business losses (see: Christopher Williams, Andrea Skinner and Matthew Helfand, Expropriation Law in Ontario, 1st ed. (Toronto: LexisNexis 2021)).
[19] In determining market value under the Act, it must be determined what a reasonably informed person would pay for the property based upon the property’s highest and best use (“HBU”) at the time using the knowledge available to the person as at the valuation date of, in this case, June 2009.
[20] The determination of market value of expropriated property is an exercise that commonly will require the assistance of opinions from real estate appraisers and other experts such as environmental consultants. In undertaking this exercise, different appraisers employing different appraisal techniques and various assumptions may arrive at different opinions as to the market value of the property.
[21] To determine the market value of property, the tests of legal permissibility, physical possibility, financial feasibility and maximum profitability are used (see: Williams et al, supra, at p. 42). Each one of these tests must be satisfied, and they must be considered sequentially. For instance, a use for property that may be financially feasible but is not legally permissible cannot be considered to be its HBU. The court continues [at paras 22-39] to assess the appellant's argument, reflecting some of these principles at work.
. The Corporation of the City of Windsor v. Paciorka Leasehold Limited
In The Corporation of the City of Windsor v. Paciorka Leasehold Limited (Div Ct, 2021) the Divisional Court sets out some basics of Ontario expropriation law:Expropriations Act
[6] The Expropriations Act governs the expropriation of private property in Ontario. Public authorities are required to compensate landowners in accordance with the provisions of the Act.
[7] Section 3(2) of the Expropriations Act provides that landowners are entitled to compensation for, amongst other things, the market value of the land, damages attributable to disturbance and damages for injurious affection.
[8] Section 14(1) of the Act defines “market value” as “the amount the land might be expected to realize if sold in the open market by a willing seller to a willing buyer”. When determining the market value of the lands, section 14(4)(b) of the Act prohibits accounting for “any increase or decrease in the value of the land resulting from the development or the imminence of the development in respect of which the expropriation is made or from any expropriation or imminent prospect of expropriation”. This principle is typically referred to as “screening out” the expropriation scheme.
[9] Damages for injurious affection may be available where the public authority only acquires part of a landowner’s lands. Section 1(1) defines “injurious affection” as follows:(i) the reduction in market value thereby caused to the remaining land of the owner by the acquisition or by the construction of the works thereon or by the use of the works thereon or any combination of them, and
(ii) such personal and business damages, resulting from the construction or use, or both, of the works as the statutory authority would be liable for if the construction or use were not under the authority of a statute… [10] Section 33(1) of the Expropriations Act provides that a 6% interest rate is payable on the market value of the expropriated property and the amount of damages for injurious affection “calculated from the date the owner ceases to reside on or make productive use of the lands”.
[11] Where the public authority and the landowner do not agree on the compensation for an expropriation, the LPAT has authority to determine the amount of compensation.[1]
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