LC050010 Feb 07 2020
LC050010 Feb 07 2020
The Ontario Municipal Board (the “OMB”) is continued under the name Local Planning
Appeal Tribunal (the “Tribunal”), and any reference to the Ontario Municipal Board or
Board in any publication of the Tribunal is deemed to be a reference to the Tribunal.
Property Address/Description: Parts 55, 57, 60, 64, 69, 70 and 115 on Plan of
Expropriation No. RE1547685 (CE 312765),
deposited in the Land Registry Office for the
Registry Division and Land Titles Division of
Essex (12);
Remaining lands within the Malden Planning
Area shown on Registered Plan 911
Municipality: City of Windsor
OMB Case No.: LC080005
OMB File No.: LC080005
APPEARANCES:
Parties Counsel
INTRODUCTION
[1] This proceeding is with respect to the acquisition by the City of Windsor (“City”)
of 187 lots within the Malden Planning Area (“MPA”) in the City, owned by Elizabeth
Frey, Bruce Paciorka, Gordon Paciorka and their wholly owned corporation Paciorka
Leaseholds Limited (the “Claimants”), by way of expropriation. This was done in three
phases in 2004, 2005 and 2008 for the purpose of preserving a natural heritage area
known as the Spring Garden Complex (“SGC”). The Claimants had been acquiring and
consolidating lands within the MPA for a number of years, with the aim of developing
the lots for residential purposes.
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[2] The Claimants and the City could not agree as to the amount of compensation
and Arbitration proceedings were commenced before this Tribunal (formerly Ontario
Municipal Board (“OMB”)) in 2008 pursuant to the provisions of the Expropriations Act
(“Act”). A hearing was held in 2009, and the Claimants were awarded compensation in
excess of the amount offered by the City. The City appealed that decision to the
Divisional Court, which upheld the Board’s decision. On a further appeal by the City to
the Court of Appeal, the Board’s decision was set aside and remitted to a differently
constituted panel of the Board for re-determination.
[3] In remitting the matter to this Tribunal for a re-hearing, the Court of Appeal
directed the parties to focus the inquiry on the impact of the 1996 and 2005 Provincial
Policy Statements (“1996 PPS” and “2005 PPS”), given that the expropriated lands
were within an area that had been identified as an Environmentally Significant Area
(“ESA”) by the Essex Region Conservation Authority (“ERCA”) and an Area of Natural
and Scientific Interest (“ANSI”) by the Ministry of Natural Resources and Forestry
(“MNRF”).
[4] The Court of Appeal opined that because the Provincial Policy Statement (“PPS”)
was not implemented with a view to the development for which the land was
expropriated, it cannot be considered a part of the “scheme” pursuant to clause 14(4)(b)
of the Act and therefore is not to be disregarded for the purposes of determining the
market value of the Claimants lands. Even without the scheme, those lands would still
be subject to the PPS and the Tribunal is required to deal with what effect that has on
the market value of those lands.
[5] The Court also determined that the Board erred in awarding compensation for
injurious affection to the Claimants on the basis of a diminution in the market value of
the remaining lands caused by the impacts of the “scheme”, rather than only the
expropriation by the City. The Court directed that the Tribunal is to take a fresh look at
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whether or not there was any impact on market value resulting from the PPS. The
question to be determined is the quantum of full and fair compensation owing to the
Claimants in order to make them whole for the City’s expropriations.
[6] Neither party denies the presence of the environmental features on the subject
lands and agree that the PPS applies to the Claimants lands because of the presence
of certain environmental features and may impact the market value as a result.
[7] The independent actions taken by the City at its own discretion with a view to the
eventual acquisition of the Claimants’ lands and the impact of those actions on the
market value of the lands acquired must be screened out. The Tribunal’s responsibility
in this case is to assess what impact, if any, the requirements of the PPS would have on
the market value of the Claimants’ lands if the impacts of the scheme are screened out.
Carrying out that responsibility should result in a determination by the Tribunal of fair
compensation pursuant to the Act and would place the owner in as close a position as
possible to that in which they would have been without the expropriations.
[8] The Claimants seek the Tribunal’s assistance in determining the market value of
the expropriated properties, absent the scheme and based on the land use that existed
in the absence of the City’s action. The Claimants also seek damages for injurious
affection and disturbance.
MOTIONS
[9] At the commencement of the hearing the Tribunal was presented with four
motions as follows:
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[10] This motion was on consent of the parties and the pleadings are hereby
amended in accordance with the attached order being Attachment 1 hereto (Exhibit 39).
Motion by City Requesting that the Tribunal Conduct a View of the Subject
Property
[11] The City argues that it is important for the Tribunal to see the lands and that
although subdivisions were approved between 1909 and 1920 and that there have not
been any improvements such as sidewalks, curbs or other municipal services. The area
is not urbanized and is at best semi-rural according to the City. It maintains that for the
convenience of the parties, the City agreed to have the hearing in Toronto and if it had
been conducted in Windsor as is the City's right, then it would have been probably
coincidental for the Tribunal to take a view of the subject property.
[12] The Claimants are not opposed to the motion but believe given the tight time
constraints for the hearing that taking a view would not be particularly helpful, would be
of limited assistance and not necessary. Counsel points out that the MPA and the SGC
was scheme-influenced and the reason it did not develop was because of City action
that precluded and delayed development, so that a view of the area today would not be
useful. Jason Beitchman argued that the Tribunal would hear evidence that the scheme
started in about 1994 and was fully formed by 1997 such that the lands ceased to be of
productive use as of August 11, 1997, some 20 years ago and that there obviously has
been a considerable amount of change in the natural features and environment.
[13] The Tribunal deferred making a decision on this motion until later on in the
hearing and ultimately did not conduct a view of the subject property finding it
unnecessary given the visual exhibits entered and the passage of time since the
inception of the scheme.
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[14] The City is seeking to exclude the two reports by Mr. Robson, who is an
accredited appraiser, on the grounds that there is no indication of any analysis carried
out by him in these reports. Counsel argues that Mr. Robson purports to advise the
Tribunal about what David Atlin, who is also an accredited appraiser, did in connection
with application of the Court of Appeal decision and how he appropriately applied it in
the preparation of his report. Counsel argues that there is no original appraisal research
in his reports and that this amounts simply to mere oath helping. Counsel further argues
that the Robson evidence does not afford the Tribunal an opportunity to critically
examine anything because he has not done anything except say "I agree with Mr. Atlin"
and that this is prejudicial to the City in that it makes it very difficult to cross-examine on
that evidence because he has not carried out any analysis. Mr. Robson purports to
proffer legal and planning opinions and he is neither a lawyer or a planner.
[15] The Board declined the motion and agreed with counsel for the Claimants that
this is a question that goes to weight and arguments can be made in closing argument
on this issue.
[16] This is a motion for directions from the Tribunal with respect to late delivered
productions received from the City. In particular, the Claimants refer to documents
received just prior to the hearing related to the South Cameron Planning Area (“South
Cameron”), wherein the City advised that they were intending to rely on this document
that had not been previously produced. This led counsel for the Claimants to make an
inquiry with one of their experts, who came up with a document entitled "Environmental
Guidelines For Development for the South Cameron Planning Area" dated May 1995.
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[17] Counsel argues that this is a document that is all about how to balance
environmental and natural heritage features and development and there are a series of
recommendations and a review of the information and issues related to natural
environment areas in the South Cameron Area. The consultants agreed with the
assessment of these areas as significant within the City context and deserving of
protection but relatively stable with respect to any impacts that might result from
adjacent development so that such development can be contemplated without major
detrimental effects.
[18] The City pursued the source of that document and brought to the hearing a box
of OPA 171 files. The Rules of Civil Procedure (“Rules”) provide that the parties are to
disclose documents in their possession, power and control that are relevant and the
claimants will need an opportunity to receive and review these documents. Counsel
would like an opportunity to make any further disclosure requests that may have
resulted from production of these, including an opportunity to consider whether there
may be other questions that may arise. Experts will need an opportunity to review these
documents, as will counsel.
[19] Counsel seeks some leeway in addressing any issues that may arise from this
set of productions or any subsequent productions in reply or at a future date.
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[20] Counsel for the City maintains that the City agreed to answer every single
question put to it on discovery and produced over 3,000 pages of disclosure expending
extensive resources tracking down every lead that it could and denies holding back
producing certain documents until the last second. Relevant documentation was
produced when it came into the hands of counsel and counsel will continue to do so.
The City has carried out its obligations under the Rules according to counsel.
[21] The Tribunal is satisfied that the City is continuing to take seriously its ongoing
obligations to produce relevant materials to the Claimants as these are discovered. The
Tribunal finds that it would be prudent to consider requests for adjudication on these
issues as these arise throughout the course of the hearing keeping in mind its obligation
to be fair to all parties. Accordingly, such requests will be considered as these arise
during the course of the hearing.
THE CLAIMS
[22] The Claimants are asking the Tribunal to award compensation pursuant to
s. 13(2) of the Act as follows:
Paciorka
Leaseholds
Injurious Affection $235,000
[23] The Claimants maintain that the acquisitions by the City were carried out
following an order of the OMB in November 2002 approving the City’s Official Plan
Amendment No. 5 (“OPA 5”), which included the addition of a provision into OPA 5
modifying the City’s acquisition strategy for the SGC and requiring fixed timelines by
which the City was to bring the subject properties into public acquisition, all in
accordance with the Board’s Order.
[24] They maintain that it was the actions of the City that prohibited development on
the subject lands and that those actions: to defer development applications, acquire
lands to block development, restrict the extension of services, make public
announcements regarding the preclusion of development and public acquisition of the
lands, and ultimately the prohibition on development in OPA 5 – form the scheme. That
scheme impacted the market value of the expropriated lands and must be screened out
in determining the compensation owed to the Claimants.
[25] According to the Claimants, their lands were future development lands and
should be valued as such, subject to appropriate adjustment for any risk arising from the
requirement to meet the necessary tests under the PPS.
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[26] OPA 5 provided for a change in the land use designation of the subject lands
from residential to environmental protection by the City, which had the effect of
prohibiting their future development. The prior residential designation provided for a
potential for development, which was lost following the amendment.
[27] The City disputes the claim for damages taking the position that any
development application would have triggered several natural heritage policies that limit
or restrict development on lands containing certain natural heritage features and that
the existence of significant habitat of threatened and endangered species would have
prohibited development of the subject properties. Furthermore, the presence of a
Provincially Significant Wetland (“PSW”), a provincially significant ANSI and a
Significant Woodland would have prohibited development of the subject properties. All
of which have a significant effect on the value of the lands and the amount of the
compensable damages under consideration.
CLAIMANTS’ WITNESSES
Bruce Paciorka
[28] Mr. Paciorka, who is one of the Claimants in these proceedings, testified on
behalf of all as a fact witness in these proceedings. Mr. Paciorka provided an overview
of the history of his family’s purchase and ownership of lands in the MPA, their attempts
to develop those lands and their interactions with the City in relation to those attempts.
He also testified about the lengthy history of these proceedings, both the process
leading up to the eventual expropriations of the Paciorkas’ lands by the City and their
subsequent pursuit of the determination of compensation before the OMB and the
Courts.
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[29] Dr. Coleman is an ecologist and environmental planner with more than 50 years’
experience. He has testified as an expert witness on approximately 225 occasions and
consulted on between 800 and 1,000 projects for both public and private sector clients.
These projects have included the preparation of portions of secondary plans and Class
Environmental Assessments. He has also advised the City, including preparing
environmental guidelines to development for the South Cameron Planning Area.
[30] Dr. Coleman was qualified as an expert witness by the Tribunal and permitted to
proffer opinion evidence as an ecologist and environmental planner. His testimony
addressed the environmental features present in the MPA known as of the dates of the
expropriations, the interpretation of relevant provincial and federal policies, the
application of those policies to the MPA, and the impacts on the development potential
of the subject properties as a result of those policies.
Richard Spencer
[31] Mr. Spencer is a professional engineer who has been in practice since 1977. The
majority of his career has been spent as a practicing engineer in the City, Essex County
and the Municipality of Chatham-Kent. He has spent his career providing land
development engineering services to major development projects. He was qualified as
an expert witness by the Tribunal and permitted to give opinion evidence with respect to
civil engineering matters, related specifically to land development. Mr. Spencer testified
on behalf of the Paciorkas as to whether the lands that they owned within the MPA
could be serviced for the purposes of development, the timing and availability of those
services, and their viability from a costing and practical perspective.
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Karl Tanner
[32] Mr. Tanner is an urban planner who has been in practice with Dillon Consulting
since 1995. His practice is primarily focussed on the Windsor-Essex and Chatham-Kent
area and he has done work for both private and public sector clients, including the City
and the South Windsor Development Company. He has assisted with many
development projects in the City and often addressed environmental issues in his work.
He has provided expert evidence before the OMB on between 40 and 50 occasions,
and was qualified as an expert by this Tribunal in these proceedings to provide opinion
evidence respecting land use planning matters. Mr. Tanner provided evidence with
respect to land use planning for the Claimants’ lands, the development history of the
MPA and surrounding areas, attempts by the Claimants to develop their lands and the
impacts of provincial and municipal policy on development of their lands.
Robert Lehman
[33] Mr. Lehman is a registered professional planner who has been in practice for
more than 45 years and is a fellow of the Canadian Institute of Planners. Throughout his
career he has worked in the public policy and private development fields, primarily in
Ontario. Mr. Lehman has been involved in drafting planning instruments such as Official
Plans and Zoning By-Laws, as well as regional planning exercises in the Greater
Toronto Area, almost all of which involved environmental or natural heritage features to
be addressed from a planning context. He has worked on behalf of the City and carried
out environmental impact work. Mr. Lehman has appeared as an expert witness
between 400 and 450 times. He was qualified by the Tribunal to provide opinion
evidence relating to land use planning measures.
[34] Mr. Lehman testified as to how provincial policies, including the PPS, affected the
use of the Claimants’ lands for development and the impacts of the City’s planning
decisions on the use of their lands. He also testified as to the scheme or development
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for which the expropriations were made, the planning process that culminated in that
scheme, and what in his opinion would likely have occurred in the MPA in the absence
of the scheme.
David Atlin
[35] Mr. Atlin is a real estate appraiser accredited by the Appraisal Institute of
Canada. He began working as an appraiser in 1980 with the bulk of his work being in
southern Ontario, including the City. He has testified as an expert witness in
expropriation hearings, ground lease arbitrations, property leases and a range of civil
litigation proceedings. He was qualified by the Tribunal to provide expert testimony
respecting real estate appraisal matters. He testified as to the market value of the
Claimants’ lands expropriated by the City, as well as the quantum of injurious affection
to the lands which remained in the ownership of the Claimants after the City’s
expropriations.
Robert Robson
[36] Mr. Robson has been a real estate appraiser since 1976 and has worked in the
field of valuation of real estate for expropriations for over 30 years. He is a fellow of the
Appraisal Institute of Canada and has served in a number of volunteer positions with the
Appraisal Institute, including as a member of the Board of Directors. He has also been
involved with the Appraisal Institute in the area of professional practice review, most
recently as a member of the Professional Practice Appeal Committee for a number of
years.
[37] His testimony focused on a review and analysis of the work of Mr. Atlin and Ray
Bower, on behalf of the City and a comparison to the work they did at the hearing before
the Board in 2009. He was qualified by this Tribunal to provide opinion evidence on
whether their work reasonably satisfies industry standards and the direction provided by
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the Court of Appeal. Mr. Robson also provided evidence with respect to the work of Ken
Stroud, a second appraiser retained on behalf of the City.
CITY WITNESSES
[38] The City called nine witnesses to testify on its behalf: three fact witnesses and six
experts.
Sarah Mainguy
[39] Ms. Mainguy is an ecologist who has been in practice for more than 30 years.
She has taken training courses from the MNRF with respect to natural heritage features
and ecology, and has prepared materials for such courses. She has identified and
evaluated the significance of natural heritage features for the purposes of development
projects throughout her career, evaluated ANSIs, and has carried out research and
teaching work. She has previously been qualified by the Board as a land ecologist, and
was qualified by the Tribunal as an expert witness to give opinion evidence as such.
Ms. Mainguy provided evidence on behalf of the City setting out her work in evaluating
and identifying the ANSI in the SGC, and the natural heritage features and species
present within it.
Paul Pratt
[40] Mr. Pratt is a naturalist and field biologist, who was employed by the City for 39
years prior to his retirement in 2014. Mr. Pratt worked primarily at the Ojibway Nature
Centre, which is a natural history interpretive centre for the City that involved
participation from the MNRF. His work related primarily to the management and
assessment of the Ojibway Prairie Complex. As part of his work, he has carried out
natural heritage inventories of species within the SGC on different occasions. He
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testified as to his observations of species and other natural heritage features during the
course of his work with the City.
Mario Sonego
[41] Mr. Sonego is an engineer registered to practice in Ontario since 1988 and was
employed by the City for 30 years before retiring in 2015. Since March 2016, he has
provided project management services for development projects through a company he
owns called Sonego Management Inc. He testified at the hearing before the OMB in
2009 in this proceeding as a fact witness on behalf of the City, and had been previously
qualified as a “City representative” in other proceedings. He was not qualified as an
expert witness in those proceedings as he was employed by the City at the time.
Mr. Sonego was qualified by the Tribunal to provide opinion evidence respecting civil
engineering matters. Mr. Sonego testified on behalf of the City as to the servicing of the
Claimants’ lands for development purposes, and the availability and viability of such
servicing.
Thom Hunt
[42] Mr. Hunt is a land use planner currently employed by the City as the Executive
Director of the Planning and Building Department. He was previously employed by the
ERCA from the late 1980’s to 1995, and the Province of Ontario through the Land Use
and Sustainability Enterprise, before commencing employment with the City in 1999.
Mr. Hunt was the City’s representative for the purposes of the examinations for
discovery leading up to the 2017 hearing in this matter. He provided evidence as to his
involvement with the study groups that fixed the consolidated boundary for the SGC
carried out by the ERCA, MNRF and the City. He also provided factual evidence
regarding the process leading up to the creation and implementation of OPA 5 by the
City and the expropriations from the Claimants.
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Nick McDonald
[43] Mr. McDonald is a registered professional planner who has been in practice
since 1989. Throughout his career, he has been involved with the preparation of Official
Plans, Zoning By-Laws, Strategic Plans, Intensification Studies and Growth
Management Studies throughout Ontario. The primary focus of his work has been on
behalf of municipalities or the public sector, but he has also provided services to private
sector clients. He has previously testified as an expert witness in OMB proceedings
and was qualified by the Tribunal as an expert to provide opinion evidence respecting
land use planning. He testified as to the impact of provincial policy on land use planning
exercises carried out by the City and the impact of provincial policy on the potential
development of the Claimants’ properties.
Mark Conway
[44] Mr. Conway is the President of N. Barry Lyons Consultants Limited. His
professional work focusses primarily on real estate, including development financing,
market analysis and the feasibility of development projects. He has worked on projects
in the City and testified as an expert witness on behalf of the City at the hearing before
the Board in 2009 in this matter. The Tribunal qualified him as an expert to provide
opinion evidence respecting market analysis and land economics. His evidence related
to the marketability of the lands in the MPA/SGC generally and the development
potential of those lands from a market perspective.
Ray Bower
[45] Mr. Bower is a real estate appraiser registered with the Appraisal Institute of
Canada, and is a fellow of the Real Estate Industry of Canada. He has been involved in
the real estate field in the Windsor area since 1972. The focus of his appraisal work has
been on behalf of public sector clients, as well as a number of private individuals,
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related mainly to expropriation and litigation work. Almost all of his work is focussed on
the Windsor-Essex area. He has previously testified as an expert witness in arbitrations
and other litigation, and was qualified by the Tribunal to proffer opinion evidence related
to real estate appraisal. Mr. Bower testified as to the market value of the lands
expropriated from the Claimants by the City and any injurious affection to the lands
remaining after the expropriation.
Ken Stroud
[46] Mr. Stroud is a professional real estate appraiser and designated member of the
Ontario Land Economists. He has been in private practice as an appraiser since 1991,
and prior to that time was employed in senior positions with the Province of Ontario and
the City of North York. Mr. Stroud has been qualified to give opinion evidence before
the OMB in the past and was qualified by the Tribunal to provide opinion evidence in
these proceedings related to real estate valuation. His evidence consisted of a review
and reply to the work of Mr. Atlin and, in a limited way, Mr. Robson. Mr. Stroud also
provided evidence as to the value of the lands expropriated from the Claimants by the
City and any injurious affection to their remaining lands.
Patrick Brode
[47] Mr. Brode is a lawyer who has been in practice since 1977 and has been
employed as a solicitor by the City since 1980, practicing mainly in the areas of
litigation, administrative law and expropriation. He has been Senior Legal Counsel for
the City since 1995. Mr. Brode was the counsel who represented the City during the
hearing before the OMB in 2009 in this matter, and has been involved with the
“Paciorka File” on behalf of the City since 2002. His testimony related to the history of
these proceedings, including Inquiries or Hearings of Necessity, arbitrations before the
OMB and subsequent appeals before the Courts.
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[48] The PPS requires that planning authorities must have regard to it or, after 2005,
be consistent with, including ensuring that any development within an ANSI had “no
negative impact” on the natural features or their ecological function. The key questions
for the purposes of this hearing are whether the presence of the ANSI represents a
restriction or a limitation on the developability of the subject properties, and whether it
had an independent impact on market value, separate and apart from the City’s
scheme. The evidence before the Tribunal includes an extensive analysis of the PPS.
Claimants’ Position
[49] The Claimants argue that the evidence in support of the claims demonstrates
that there was nothing in the PPS that prohibited development of the subject properties.
They maintain that the subject properties retain their residential land use designation,
with the presence of the natural features on the lands representing an environmental
constraint requiring further study before development would be permitted and that this
was a typical approach in the Province, and is an approach that had regard to the PPS
and was the approach the City took in its 2000 Official Plan.
[50] The Claimants argue that the information concerning the natural features in the
SGC that was available at the time of the expropriations demonstrates that but for the
City’s actions, the Claimants would have been able to meet the applicable tests under
the PPS ‘relatively easily’ in 2004, and that it was more challenging but still possible in
2005 and 2008.
[51] The PPS was issued under s. 3 of the Planning Act (“PA”) and came into effect
on May 22, 1996 replacing the Comprehensive Set of Policy Statements (“CSPS”). The
PPS addresses a variety of issues including the treatment of natural heritage areas and
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[52] The PA provides that planning authorities were to “have regard to” the 1996 PPS
and “be consistent with” the 2005 PPS. The PPS also recognizes that there are
“complex inter-relationships among environmental, economic and social factors in land
use planning”. It promotes a balancing between the use and protection of resources,
long term health and safety of the population and economic well-being of the Province
and municipalities.
[53] The PPS lists multiple priorities that municipalities are to have regard to. Among
other priorities, these include:
Avoiding development and land use patterns that may cause public
health or safety concerns;
[54] The PPS provides further guidance to planning authorities through its
implementation guidelines. It provides that the PPS is to be read in its entirety, and that
all pertinent policies are to be applied to each situation. The implementation guidelines
advise that planning authorities have the discretion to go beyond the minimum
standards established in the policies.
[55] Within this context, the PPS provides for specific policies with respect to natural
heritage. Section 2.3.1 of the PPS provides that natural heritage features and areas will
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[56] The key provision for the purposes of this matter, is Section 2.3.1(b), which
provides as follows:
[57] A number of the terms in Section 2.3.1(b) are italicized meaning that that these
have a separate definition in the “Definitions” section of the document. The PPS is a
complex inter-relationship between the statements of policy and the definitions,
requiring constant cross-referencing to the definitions section to ensure that the full
meaning of a provision is understood.
[58] The SGC was identified as a provincially significant ANSI, and therefore
Section 2.3.1(b) of the PPS was triggered when considering land use policies on or after
May 22, 1996. A key issue for the Tribunal to determine, and one of the reasons that the
Court of Appeal remitted the matter back for a new hearing, is to determine the impact
of the ANSI identification and corresponding application of the PPS as an independent
factor affecting the market value of the subject lands properties, separate and apart
from the City’s scheme.
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[59] As part of determining the impact of the ANSI identification and application of
Section 2.3.1(b) of the PPS, the Tribunal must examine the definition of “no negative
impact” and assess how that test may inform the marketplace and any potential buyer
for the subject properties in the open market.
[60] The Tribunal heard a significant amount of evidence during the hearing as to the
meaning of this test and it was quite evident that the parties’ interpretations diverged
significantly. The key issue was the question as to whether permitting development of
the subject properties would or would not have a negative impact within the meaning of
the PPS.
[61] “Negative impacts’’ is a defined term in the PPS and it is defined as follows:
[62] The key aspect of the definition is the phrase “the loss of the natural features or
ecological functions for which an area is identified.”
[63] Dr. Coleman was the Claimants’ primary witness on this issue. Mr. Lehman, the
land use planner, confirmed that in his experience the no negative impact test was
interpreted and applied in a manner similar to that opined by Dr. Coleman.
[64] Dr. Coleman had worked with each of the 1996 and 2005 PPSs extensively over
his career as an environmental consultant, having consulted on approximately 1,000
projects with environmental planning and ecology issues. He has provided opinion
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evidence before the OMB on these subjects approximately 225 times and during the
relevant period, he undertook approximately 100 studies that applied the test. He was
the only witness to testify on behalf of either party who has expertise in environmental
planning and was the only witness qualified to provide opinion evidence on that subject.
[65] He testified that in his experience, the concept of “no negative impact” was the
most frequent misinterpretation that arose when applying the PPS. The source of that
misinterpretation according to Dr. Coleman, arose because reading only Section 2.3.1
of the PPS, without reference to the Definition section, may give rise to the impression
that “no negative impact” means no impact. He maintains that the definition of “negative
impact” explains that it means “the loss of the natural features or ecological functions for
which an area is identified.” That specific wording required that, to be considered
negative within the PPS definition, an impact must result in the loss of the feature.
[66] The correct way to interpret the “no negative impact” test, according to
Dr. Coleman, was that “you could cause an impact as long as the feature or function
was not lost”. He referred to a leading OMB decision (St. John’s Road Development
Corporation v. Aurora (Town), 2001 CarswellOnt 7113 (File No. PL000902 at page 4)
(“St. John’s Road Development”), that interpreted the standard as “complete loss”: the
PPS allows one to develop, as long as one does not have a complete loss of the feature
or function.
[67] Dr. Coleman noted that if he was advising a developer or a municipality at the
time, his advice would have been consistent with the standard adopted by the OMB in
the St. John’s Road Development case as it was the standard often applied at the time.
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Dr. Coleman’s conclusion that development approval would have been granted
“relatively easily” was because to establish a negative impact, one would have to
demonstrate there would be a “complete loss” of the feature identified by the ANSI.
[68] His opinion was that the “complete loss of the natural features” in the SGC meant
that it would include the loss of all the flora and the fauna in the area, as well as the
ecological communities that they are located in.
[69] He expressed the view that if all of the Claimants’ lots from the ANSI were
developed, there would still be more than 90% of the lots left within the consolidated
ANSI boundary and that if the 1994 MNRF ANSI boundary was used, developing all of
these lots would impact approximately 4% of the lots. If one looked to the true ANSI,
which includes all five of the Ojibway Prairie Reserve sites, the impact would be
considerably less than 4%.
[70] Dr. Coleman advised that the “no negative impact” test in the 1996 PPS could
have been met relatively easily in connection with a development application for the
subject properties because, the distribution of features in the SGC is over a large area
and that the loss of the features over such a large area and that taking away a small
portion of it is not likely to result in the loss of the overall character of the area. The
SGC is a portion of a larger ANSI comprised of five separate sites throughout Windsor
known as the “Ojibway Prairie Remnants Life Sciences ANSI”.
[71] He explained how any proposed development application would address the
“complete loss” standard in the context of the entire ANSI rather than only the SGC and
that it would be appropriate to conduct a staged review, to consider first whether there
would be a negative impact on the SGC, and then if necessary consider how
development would impact the larger Ojibway Prairie Remnants.
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[72] He noted that one could have a complete loss of a specific feature if that
occurred in the SGC and nowhere else in the ANSI and that in this case there is prairie,
which is throughout all of the areas. Mr. Pratt, the naturalist and field biologist who,
testified for the City agreed that all of the features present in the SGC exist elsewhere in
the larger ANSI.
City’s Argument
[73] The City argues that any development application for the subject lands would
have triggered the application of a number of natural heritage policies under the PPS
given the existence of the following features:
[74] The City relies on the evidence of Ms. Mainguy, who testified that threatened
species existed on the site at the time of the expropriation and that the features and
functions within the SGC were such that the PPS would have precluded development of
the subject properties as at the effective dates.
[75] The City submits that the uncontroverted evidence of Ms. Mainguy’s fieldwork,
the evidence of Mr. Pratt, and the existing biological inventories all demonstrate that the
subject properties constituted significant habitat of several threatened species. Counsel
argue that if the Tribunal finds as fact that the habitat of threatened species existed on
the subject properties as at the Valuation Dates, there is an absolute prohibition on
development. The “but for” analysis would end there and that there is no necessity for
the Tribunal to consider the alternative scenario of impacts on natural heritage features
including the “no negative impact” test.
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[76] Both the 1996 and 2005 PPSs contain an absolute prohibition on development
and site alteration of lands that contain significant habitat of endangered and threatened
species and the City submits that the approach taken by Ms. Mainguy more accurately
reflects the obligation to assess the habitat of threatened species during a development
application than the approach espoused by Dr. Coleman. Rather than conduct a
technical policy review, Ms. Mainguy and Mr. McDonald undertook an analysis of how
the City would have actually recognized and applied provincial policy in conducting an
Environmental Evaluation Report (“EER”) for the Subject Properties.
[77] Ms. Mainguy’s evidence demonstrates the extent of the habitat of threatened
flora and fauna in relation to the subject properties. Her report also provides a detailed
analysis of each species, its behaviours, and how the habitat was identified and then
showed the cumulative effect of the identified habitat of these threatened species with
her conclusions, demonstrating that all but three of the Claimants’ lots contained
significant habitat of a threatened species.
[78] The City maintains that the habitat of the Eastern Foxsnake alone would have
posed a serious impediment to anyone attempting to develop lands in the SGC.
Eastern Foxsnake habitat spans much of the ANSI according to Ms. Mainguy and
impacted 65% of the subject properties.
[79] The City argues that the Claimants presented no significant challenge to
Ms. Mainguy’s conclusions other than asserting that her work was conducted after the
Valuation Dates. Counsel argue that the Tribunal can take into account after-the-event
evidence in order to confirm whether or not a particular fact would have been
reasonably probable as at the Valuations Dates.
[80] The City also argues that as a practical matter, Ms. Mainguy could not conduct
her fieldwork until 2014 due to the timing of the Court of Appeal’s decision. However,
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her evidence was carefully bracketed with pre and post Valuation Date evidence that
confirmed her conclusions. The majority of the species identified by Ms. Mainguy were
identified in the biological inventories that long pre-date the Valuation Dates. Mr. Pratt
noted that he had tracked Eastern Foxsnake and the species was present as at each
Valuation Date. Mr. Pratt’s Witness Statement and oral testimony also confirmed that
the natural heritage features identified by Ms. Mainguy’s 2014 fieldwork were present in
the SGC as at the Valuation Dates. One can draw a reasonable inference that the
species identified in the mid-1990s that were again identified by fieldwork in 2011 and
2014 were present on the Valuation Dates.
[82] The City submits that the approach taken by Ms. Mainguy more accurately
reflects the obligation to assess the habitat of threatened species during a development
application. Rather than conduct a technical policy review, Ms. Mainguy and
Mr. McDonald undertook an analysis of how the City would have actually recognized
and applied provincial policy in conducting an EER for the Subject Properties.
[83] Dr. Coleman conducted a technical analysis on the 2005 and 2008 Valuation
Dates when further threatened species had been confirmed by the province and
admitted that dealing with these threatened species would require study of the features
and functions and that “this is a more difficult test requiring study, planning and
negotiation”. He also admits that the test under the 2005 PPS is more restrictive. He
nevertheless concluded that the test could be met.
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[84] The Claimants’ experts prepared no fieldwork and little analysis of pre-existing
biological inventories to support the conclusion that the test could be met despite the
significant studies that would be required. Dr. Coleman provided no evidence as to how
the Claimants could prepare an EER that would not impact the significant ecological
functions in the SGC.
[86] Dr. Coleman also speculated that the Claimants could have theoretically
removed the threatened species from the subject properties without risk of legal
recourse. There is no evidence that this ever occurred in a manner sufficient to destroy
the presence of habitat on the subject properties.
[87] The City maintains that there is a PSW on the subject properties and that the
1996 PPS and 2005 PPS would have prohibited development and site alteration on
these lands.
[88] The 1996 PPS and 2005 PPS prohibit development and site alteration in PSW.
[89] It was uncontroverted that the SGC was identified as a PSW in January 2009
based on fieldwork that was conducted in the summer of 2008. Again, Dr. Coleman’s
policy review approach took a narrow approach to this risk. Dr. Coleman’s report
acknowledges the January 2009 designation, but he disregards the risk in his analysis
because the designation occurred after the Valuation Dates.
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[90] With respect to the “no negative impact” test, counsel for the City referred to
some previous decisions of the OMB, where the Board did not accept the “complete
loss” standard that had been accepted in the 2001 St. John’s Road Development case.
Counsel argue that negative impact means an unacceptable adverse impact on the
environment, where the natural link between the two ecologically sensitive areas was
broken and that that there would be a negative impact if the features and functions were
seriously and negatively impacted.
[91] The City further submits that Dr. Coleman should have been aware that the
percentage-based approach or “complete loss” test was rejected in previous cases
where he testified as a witness. In Ferzoco Estate v. Toronto (City), 2006
CarwsellOnt 635 (“Ferzoco Estate”), the Board rejected Dr. Coleman’s percentage-
based approach to assessing impacts to a woodlot and valley lands by a proposed
development. The Board commented that this approach fails to appropriately consider
the loss of ecological size and function.
[93] The City submits that this is essentially what happened in the boundary
consolidation exercise. Any EER undertaken by the Claimants would have identified
various aspects of the ANSI that would have been necessarily impacted by residential
development. It is probable that, absent the City’s involvement, the EER and secondary
planning process would have prohibited development up to 1994 ANSI boundary,
including 134 of the Claimants’ lots that the Claimants allege suffered injurious affection
due to expropriation.
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Findings
[94] The Tribunal notes that the City did not call an environmental planner as a
witness and relied on Ms. Mainguy, an ecologist, and Mr. McDonald, a land use
planner, to provide evidence to the Tribunal with respect to the PPS and the
interpretation of the “no negative impact” test. Neither of these witnesses were qualified
to provide opinion evidence on the interpretation and application of the “no negative
impact” test. They relied on each other’s interpretation of the test under but did not
apply it themselves.
[95] The Tribunal prefers the opinion evidence proffered by Dr. Coleman and
Mr. Lehman on this issue over that of Ms. Mainguy and Mr. McDonald for the reasons
that follow.
[96] Ms. Mainguy admitted in cross-examination that she was not qualified to
undertake any of the balancing exercise or interpretation required under the PPS.
Instead, she stated that her role was to describe what was on the land, the significance
of the features and the potential impacts. Her interpretation of the meaning of the “no
negative impact” test was quite different from Dr. Coleman’s.
[97] Mr. McDonald deferred to Ms. Mainguy on the question of whether there is a
negative impact or not. His evidence suggested that it was up to an ecologist to
determine and also contradicted Ms. Mainguy’s understanding of the no negative impact
test, agreeing with counsel for the Claimants under cross-examination that “no impact”
is not the correct standard.
[98] Mr. McDonald agreed that “loss” with respect to a feature would mean the loss of
the feature and that loss with respect to the ecological functions meant those that were
initially identified had been lost. He agreed that loss means “you don’t have it any
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[99] Although the provincial policy changed through the introduction of the PPS, the
City’s policy did not change to reflect the modified standard for development in an ANSI.
There is no evidence that the City undertook any kind of re-balancing process once the
PPS came into effect in May 1996, nor is there any evidence that they either assessed
or evaluated how the PPS ought to be interpreted and applied in the context of the
MPA.
[100] The actions by the City to expressly preclude development within the SGC after
May 1996 was the City’s sole decision alone and made in its absolute discretion. The
Tribunal does not agree that the PPS imposed a prohibition on development within the
SGC but rather imposed certain limitations, which could be addressed with relevant
studies/reports in association with development applications.
[101] Ms. Mainguy did not focus her review on the information that was available as of
the effective dates or evaluate how market participants might view that information
when determining the developability of the Claimants’ properties or their value. The field
work that she carried out resulted in data that was collected well after the effective dates
of the expropriations, primarily between 2011 and 2016.
[102] The Tribunal agrees with Dr. Coleman’s opinion that Ms. Mainguy's work should
be reviewed with caution, given that substantial changes have occurred in and around
the SGC since 2004 including what was referred to as the Detroit River International
Crossing (“DRIC”) project and habitat maintenance and species management in
connection with that project. Her evidence cannot be said to be reliable for establishing
the conditions as these existed at the effective dates. Dr. Coleman noted that species
had been transplanted into the SGC between 2012 to 2015, including the construction
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of a snake fence. Mr. Lehman was also of the opinion that environmental characteristics
of land can change significantly over time.
[103] It is also noted that Mr. Bower, the City’s appraiser admitted that he did not rely
on Ms. Mainguy opinion for either the interpretation of the PPS, or for his analysis of the
highest and best use or value of the lands. He admitted that instead, he relied on the
environmental studies that were already undertaken to determine the knowledge of
market participants, as Dr. Coleman and Mr. Lehman had done, and that he did not rely
on Ms. Mainguy’s report or opinion. He also agreed that relying on a biological study
based on information collected after the dates of expropriation would not be
confirmatory of pre-expropriation conditions for the purposes of determining value.
[104] Ms. Mainguy’s field work, completed in 2014 and 2016, was for the most part
restricted to examining the features on the Claimants’ properties. She did not study the
whole of the SGC to identify whether the features or functions present on the Claimants’
lands in 2014 or 2016 also existed elsewhere within the complex. Furthermore, she
admitted that she did not study the entirety of the Ojibway Prairie Remnants ANSI, of
which SGC is only a portion, and therefor cannot opine on the full extent of the features,
habitat or functions as they existed within the ANSI at the relevant times.
[105] Contrary to Ms. Mainguy’s view that the SGC was highly vulnerable, the factual
information available in that regard is that the features and functions present are
actually quite hearty and have subsisted despite development with certain features
continuing to exist in close proximity to development that had occurred in Huron Estates
and the Bethlehem-Lamont areas. Also, Mr. Pratt acknowledged on cross-examination
that prairie habitat has proven to be quite hearty and can subsist despite all the
development or intrusion that has occurred over the years.
[106] The particular species of flora and fauna identified in or around the subject
properties existed elsewhere in the City and appear to be quite prevalent in those areas.
33 LC050010-L050012
Mr. Pratt agreed that all of the species at issue in this case existed elsewhere in the
larger Ojibway Prairie Remnants ANSI. Further, many of the species at issue were
collected in substantial quantifies from the DRIC project footprint and transplanted into
other areas in the City with, “very, very substantial success” according to Dr. Coleman.
Ms. Mainguy acknowledged that there were only two transplantation sites in the SGC,
neither of which were on the Claimants’ properties, and that there were more than 10
other transplantation sites elsewhere in the City.
[107] Ms. Mainguy also relied on field work done between 2011 and 2013 by others in
connection with the DRIC infrastructure project. Her reliance on the Transportation
Ministry’s (“MTO”) snake studies proved in cross-examination to be unreliable and
tainted by alterations to the population and environment in connection with the DRIC.
She admitted that portions of her data represented information collected after a snake
fence had been built to keep the snakes inside the SGC and after a large number of
snakes had been relocated into the area. She also admitted that she did not know what
some of the data she relied on meant, as it had been provided to her, but she did not
question it.
[108] Ms. Mainguy further admitted that she did not know how many snakes the data
represented, in what years they had been radio-tracked, how many had been found in
any particular year or how many had been relocated into the SGC, and had no data to
confirm whether there had been snakes relocated prior to the fence going in. She
admitted that the most critical habitat represented on her mapping – the snake’s
hibernaculum – was in the Oakwood area, and not in the SGC.
[109] Accordingly, the TribunaI will not rely on Ms. Mainguy’s conclusions and opinions
with respect the applicability of the PPS on the Claimants’ lands. The Tribunal prefers
the evidence of Dr. Coleman and Mr. Lehman, who relied on the data that was available
as of the effective dates and reached their conclusions based on an understanding of
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the PPS that had, in their extensive experience, been the standard at the relevant times
and had been expressly endorsed by the Board during the relevant times.
[110] Furthermore, the Tribunal does not accept the City’s argument that there are
PSWs or significant portions of habitat of threatened or endangered species on the
subject properties. Such identifications are made by the MNRF, and neither had been
made as of the effective dates. Consequently, there is no reliable evidence before the
Tribunal that anyone in the market would have known or contemplated that either
identification existed. It is noted that neither Mr. Bower nor Mr. Stroud relied on these
conclusions for the purposes of the City’s opinion on value.
[111] Accordingly, the Tribunal concludes on the balance of probabilities, given its
findings above that the PPS would not have prohibited development on the subject
lands on the relevant dates. The PPS left it open for an owner of such lands to make
applications for development and would have required such applicants to submit the
appropriate studies to show that the development proposed would or could meet the “no
negative impacts” test.
[112] The Tribunal cannot conclude based on the evidence before it that it is more
likely than not that any endangered species existed on the subject properties on the
valuation dates.
The market value of the land expropriated is the amount that the land
might be expected to realize if sold in the open market by a willing seller
to a willing buyer.
[117] Section 14(4)(b) set out above directs that when determining the market value of
expropriated property, the Tribunal is to take no account of any increase or decrease in
the value of the land resulting from the development, or its imminence, for which the
lands are expropriated. This is commonly referred to as “screening out the scheme”.
[118] The origin of a scheme is not always clear. It generally starts out as an imprecise
concept that becomes progressively more definite and well known as time goes by. The
progression from vagueness to becoming more definite generally makes it difficult to
isolate the impacts of the scheme when estimating the market value of an expropriated
property. To screen out those impacts, it may be necessary to screen out a significant
period of time and a substantial number of actions taken by the expropriating authority.
36 LC050010-L050012
The Tribunal is then required to reconstruct a “but for” world in order to determine the
value of the expropriated lands without the effects of the scheme.
Claimants’ Argument
The Scheme
[119] The scheme in this case according to the Claimants, is the preclusion of
development within a natural heritage area in the MPA, related to the eventual
acquisition of those lands for the purpose of preserving a natural area known as the
SGC.
[120] The City had indicated that the expropriations were “for the purposes of
preserving a natural area” known as the SGC ANSI. This public acquisition was to “form
a visible and centrally located community park/prairie/woodland” according to the
evidence before the Tribunal.
[121] The Claimants argue that OPA 5 was the planning instrument that implemented
this scheme. Prior to OPA 5 all of the lands in the SGC, including the Claimants’ lands
but excluding a core of City-owned lots, had a residential land use designation. OPA 5
expressly precluded development within the consolidated boundary by changing the
land use designation for lands within the boundary to Natural Heritage, which permitted
only use as a nature reserve and wildland management. The only permitted uses within
the SGC were bikeways recreation ways and areas for natural and scientific research
under OPA 5.
[122] Mr. Lehman was of the view that in this case, the Tribunal ought to screen out
any policies in OPA 5 that have the effect of precluding residential development within
the SGC. OPA 5 had been the subject of a lengthy process leading up to its ultimate
implementation and forms part of the scheme. Its impacts on market value must be
37 LC050010-L050012
screened out when determining the market value of the Claimants’ lands, according to
Mr. Lehman, who also maintains that the start date of the scheme must be determined
to ensure that all of the effects on market value flowing from the scheme are screened
out.
[123] Mr. Lehman referred to a number of internal City documents dating back to
September 1992, which contemplated prohibiting development in the SGC and
expressed the view that this pointed to the commencement of the scheme. The area
was designated as an ESA and ANSI at the time, but there were no provincial policies in
place that would preclude development in the area.
[124] He also pointed to a number of further steps taken between 1992 and 1997 that
resulted in the deferral of development applications within the MPA while the City
undertook the planning process. He opines that those steps form part of the scheme
and should be screened out accordingly.
[125] In June 1995, there was a consensus on a re-defined consolidated boundary for
what would become the SGC and it was never changed. Development was not
permitted by the City within the boundaries of the SGC from that date on.
[126] In June 1996, the City’s planning department confirmed that residential
development was recommended to be precluded within the consolidated boundary of
the SGC. This included the Claimants’ lands within the consolidated boundary and,
while the prohibition on development was not adopted until 2002, the City’s intention to
do so was clear by June 1996. The City had also retained Dillon Consulting Limited to
prepare a Development Plan for the MPA, which eventually precluded development
within it.
[127] In May 1997, Mr. Paciorka made inquiries at the City to determine if he might
bring forward a development application on some of the Paciorkas’ lands within the
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ANSI. At that time, he was told by City planning staff that the City had not yet
determined exactly how it wanted to proceed, and that they would prefer not to receive
any applications at that point. Mr. Lehman opined that that was “definitely” part of the
scheme.
[128] In 1997 Dillon finalized its Development Plan, which served as the background
study for what ultimately became OPA 5 and incorporated the work and
recommendation of the City’s 1996 EER. This plan included a re-designation of lands
within the SGC from residential to natural heritage and recommended a mapping
change that effectively implements the scheme. The SGC as depicted on that map is
the same boundary that was agreed-upon by the Study Group in June 1995. A study
that had been formed for that purpose some time prior to this.
[129] Mr. Stroud also agreed with the Claimants’ position that the scheme is to publicly
acquire lands through OPA 5 to create a public park. He also agreed that the PPS
provided the ability to do an environmental study to examine whether development
could or could not occur, subject to the no negative impact test. He further agreed that
the prohibition on development in OPA 5 removed the ability to do such a study and
satisfy the applicable test.
[130] The scheme became fully realized in June 1995 in the second Study Group
meeting, when a decision was made to create a hard-edged consolidated boundary and
preclude development within it. It became public in June 1996, when the Dillon
Development Plan was announced and was further reinforced by the City when that
Plan was received by Council on August 11, 1997 to guide development in the MPA.
This scheme was eventually formalized in OPA 5 and once approved by the OMB,
OPA 5 precluded residential development within the SGC boundary and ultimately led
to the expropriations herein.
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[131] The City did not proffer any evidence on the scheme with Mr. McDonald stating
that he did not consider the scheme in his evidence and admitted that doing so was
outside the scope of his retainer.
[132] The formalization of an acquisition strategy was considered internally by the City
and repeatedly deferred while it searched for funding from other partners resulting in a
number of development applications being put on hold according to the evidence. The
formal acquisition strategy for the SGC was adopted by City Council in December 1999
with the Dillon Consulting Limited MPA Development Plan being incorporated into a
new proposed secondary plan for the area; the Spring Garden Secondary Plan, which
later became OPA 5. The City at public meetings related to the proposed secondary
plan, represented that it would be purchasing lands in the area at fair market value,
which was understood by landowners in the area to be based on the lands having
residential market value. OPA 5 was adopted by the City including the acquisition
strategy.
[133] The impact of the scheme is that the Claimants’ lands were restricted to use for
natural heritage purposes precluding residential development. Absent the scheme, the
Claimants’ properties and surrounding lands would have retained their residential land
use designation, with an environmental constraint overlay reflecting the PPS
requirement that development on these must meet the no negative impact test. In
Mr. Lehman’s opinion, absent the scheme it is likely that the City would have taken the
position that it wanted to see the area develop as residential. It would have proceeded
with a secondary plan that retained the residential land use designation with a policy
stating that there was a constraint on development due to natural features in the area.
The constraint would be depicted on a schedule; if an owner wished to develop lands in
accordance with the underlying residential designation, they would be required to
address the nature of the features, the potential negative impacts and means of
mitigation by way of a report, study or otherwise.
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[134] Mr. Lehman opined that there was an existing policy framework in place within
the City’s planning documents that could implement such an approach. He described
how such a constraint overlay would operate if a proponent of development submitted
an application. He also distinguished his proposed approach from what actually
happened in the City, indicating that there was a significant difference in OPA 5 where,
rather than being permitted to submit a development concept and conduct a study,
development applications were expressly precluded.
[135] The City’s 2000 OP designated the majority of the SGC as having an underlying
residential land use. A core area, the majority of which was owned by the City and did
not include any of the Claimants’ lands, was designated natural heritage. The remainder
of the SGC had an environmental constraint overlay, Environmental Protection Area
EPA A, which allowed for development subject to study and other measures. The
requirements of the EPA A constraint incorporated the no negative impact test under
the PPS.
[136] The 2000 OP was approved by the province and the allowance for development
within the SGC subject to an environmental constraint was deemed to be compliant with
provincial policy and the PPS.
[137] Mr. Spencer, the Claimants’ servicing engineer opined that absent the scheme
servicing would have proceeded to progress with the Claimants’ lands being fully
serviced by the mid-2000s, at the latest. He was of the view that the MPA was very
similar, from a servicing perspective, to South Cameron and that absent the scheme
servicing in the MPA would have proceeded along a timetable similar what took place in
South Cameron.
[138] Services were available for the area and as Mr. Spencer testified, there were
many options available to implement those services while mitigating or eliminating the
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[139] In such a scenario, the Claimants’ lands would be residential with servicing
options available, subject to an environmental constraint. A potential purchaser would
consider the constraint and factor it into their purchase price. Absent the City’s scheme,
that is precisely the situation the Claimants’ lands would have been in with respect to
the market place, and is the basis upon which compensation should be determined by
this Tribunal.
The most probable price, as of a specified date… for which the specified
property rights should sell after reasonable exposure in a competitive
market under all conditions requisite to a fair sale, with the buyer and
seller each acting prudently, knowledgeably and for self-interest, and
assuming that neither is under undue duress.
[142] The Claimants relied on the expert real estate appraisal opinion of Mr. Atlin to
estimate the market value of their properties. He had previously prepared expert
reports, and proffered viva voce testimony, during the 2009 hearing of this matter. He
revised his opinion in this hearing to reflect the direction of the Ontario Court of Appeal.
[143] The City called two appraisers in support of its case. Mr. Bower, a senior
appraiser based in Windsor, who provided a valuation opinion. He had also testified at
the first hearing in 2009. He also revised his report in light of the Court of Appeal’s
decision.
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[144] The City also retained Mr. Stroud to conduct a peer review of Mr. Atlin’s report.
While he initially denied doing so, it became clear that Mr. Stroud did more than simply
peer review Mr. Atlin’s report as he had provided an independent opinion as to the value
of the Claimants’ properties. and ultimately admitted having done so, and that the
Tribunal should disregard that value opinion. Mr. Atlin and Mr. Bower both applied the
direct comparison approach to assist in determining the estimated market value of the
subject properties.
[145] Mr. Atlin’s reports reviewed the land use planning history for the MPA and relied
on the opinions expressed by Dr. Coleman and Mr. Lehman as to their interpretations of
the PPS and the scheme. These opinions assisted him to value what independent
impact, if any, the PPS had on the Claimants’ lands separate and apart from the City’s
scheme.
[146] Mr. Atlin determined that without the influence of the scheme, the highest and
best use of the Claimants properties is for future residential development. He was clear
in stating that he did not value the Claimants’ lands as having an imminent development
horizon, rather he more appropriately characterized these as having a longer term hold.
[147] He opined that, absent the influence of the scheme, the continued consolidation
of lots within the MPA would have occurred and the City would have encouraged further
consolidation and been an active party to development in the area, as this would have
been the prudent and knowledgeable action for the City to take.
[148] His investigation identified sales in the SGC, the South Cameron and South
Windsor areas. He was of the view that South Cameron and South Windsor “are highly
comparable to the Spring Garden area”. In his view, South Cameron and South Windsor
sales reflect the market behaviour, trends and values that would have been evident in
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SGC without the scheme. Mr. Bower, the appraiser who testified on behalf of the City,
had previously agreed that the areas are reasonably equivalent and an appropriate
proxy for one another. The areas are similar in that they possess environmental
constraints. Dr. Coleman viewed these as similar from an environmental perspective.
Both have similar legacy subdivisions and fragmented ownership, are physically
proximate to one another and are the most comparable areas in the City from a
servicing perspective. The City itself had concluded that as of March 1995, MPA and
South Cameron were similar in terms of land use, servicing and environmental issues.
[149] Mr. Atlin excluded sales of lands in the MPA as, in his view, it is difficult to screen
out the impact on these sales due to the expropriation scheme. He also excluded sales
where the City was involved in the transaction and restricted the dates of sales
investigated to between January 2000 and March 2008. Ultimately, he narrowed his
selection of comparable sales to those that occurred in the 12 months prior to the date
of the first expropriation and indicated that the bulk of those sales presented a range
between $250 - $400 per front foot.
[150] He then undertook a locational analysis, noting that each of the South Cameron,
South Windsor and SGC areas are bounded by the EC Row Expressway and Huron
Church Road. The benefit of the proximity to major vehicular routes is shared by all
three areas, but he noted that values closer to the major collector routes are reduced
from values for properties that are further removed from the road corridors (i.e. without
noise/pollution issues).
[151] Mr. Atlin concluded that the relatively better location of the subject lots away from
the collector route corridors supported selecting a range of value toward the upper end
of the range. Mr. Stroud agreed that lands without noise attenuation issues are more
valuable than those with a noise issue. He also agreed that there could be a premium
as high as 20% on the value of land that is in proximity to a natural feature, or it could
be even higher depending on the location.
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[152] He included a 10% increase to the value of the properties to reflect the
advantage for the lots as a result of their consolidation. Mr. Stroud also agreed under
cross-examination that consolidated lands have more value than individual parcels, and
that all of the expropriated lands represented consolidated holdings.
[153] He then analyzed whether any adjustments were required for planning purposes
and relied on the planning opinion of Mr. Lehman, who concluded that the 1996 PPS
“would have little or no impact” on the development potential of the subject lands lying
within the ANSI defined by MNRF in 1994. On this basis, he applied a downward
adjustment of 5% to account for additional development costs, consultant fees and
minor delays due to planning. Based on the Coleman and Lehman opinions, Mr. Atlin
concluded that any non-scheme related impediments were not materially greater than
any other requirement for the development of greenfield land, as at the effective date.
[154] After applying these adjustments, he concluded that a rate of $400 per front foot
was reasonable for the consolidated land holdings, and a value of $355 was reasonable
for the non-consolidated lots. He estimated the market value of the Claimants’ 2004
expropriated lands at $1,140,000.
[155] Mr. Atlin carried out a similar analysis in respect of the market value for
Ms. Frey’s lands expropriated in 2004. He determined, however, that the Frey lots have
a “specific locations influence” because of their proximity to the Malden Transformer
Station, and therefore represented an inferior location. Accordingly, he applied a value
at the lower end of their range and identified $325 per front foot as reasonable. A
consolidation adjustment was applied for the Frey’s lots, but as the holdings were
smaller than the Paciorkas’ 2004 lands, a 5% downward adjustment was applied to
account for additional development costs, consultant fees and minor delays due to
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planning. After accounting for these adjustments, Mr. Atlin concluded that the estimated
the market value of Ms. Frey’s lands as of April 7, 2004 was $250,000.
[156] Mr. Atlin’s analysis with respect to the market value for the 2005 expropriations
was similar in approach, although different in its data set and adjustments. He
maintained his conclusion that the highest and best use for the 2005 expropriated lots
without the scheme is for residential development.
[157] He maintained the opinion that the South Cameron and South Windsor areas
remained the best comparable for SGC, and that SGC transactions ought to be
excluded, given the difficulty of screening out the impact of the expropriation scheme on
these sales.
[158] Similarly, he maintained the focus on sales that occurred in the 12 months prior
to the date of the expropriation and noted that those sales presented a range of value
between $250 to $550 per front foot.
[159] Based on the locational adjustment analysis undertaken in the 2004 report, and
given the relatively better location of the 2005 expropriations, Mr. Atlin selected a value
range at the upper end of the range and considered $425 per front foot to be
reasonable.
[160] He applied a similar 10% upward adjustment for the consolidation of the 2005
lots.
[161] He noted the planning opinion of Mr. Lehman, who agreed with Dr. Coleman, that
meeting the standard under the 2005 PPS would still be possible but would be more
challenging than under the 1996 PPS. Mr. Lehman noted that it was likely negotiation
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would occur to allow for both the protection of some of the natural heritage features and
for some of any proposed development.
[162] Based on this, Mr. Atlin estimated that a downward adjustment of 22.5% was
appropriate to reflect the non-scheme related planning elements that affected the 2005
expropriated properties. This resulted in an estimated market value of $370 per front
foot for consolidated lots, and $330 for non-consolidated lots, resulting in a total
estimated market value of the 2005 expropriated properties in the amount of $830,000.
[163] With respect to the lands expropriated in 2008, Mr. Atlin’s research indicated that
there was only one transaction that occurred within 12 months of the effective date. In
his view, the values remained stable between the date of the 2005 expropriation and the
2008 expropriation and he applied the same range of values as had been applied in
respect of the 2005 expropriation.
[164] He concluded that the expropriated westerly lots had a relatively better location
than the easterly lots expropriated in 2008 and adjusted accordingly. There is a
consolidation of the easterly lots and so he applied a 10% upward adjustment to the
base rate for that consolidation. Considering a planning adjustment for non-scheme
related impact of the 2005 PPS, Mr. Atlin applied a downward adjustment of 28.5% for
the 2008 expropriated lands. This adjustment was higher than the 2005 adjustment as a
result of, in his view of additional market knowledge and some additional uncertainty
regarding potential future legislative changes.
[165] Mr. Atlin concluded that the 2008 expropriated lands had a price per front foot
rate of $305 and a total market value of $115,000 after having applied his adjustments.
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City’s Argument
The Scheme
[166] The City points to s. 14(4)(b) of the Act and argues that the policy rationale for
this section is to ensure that an expropriated owner receives fair compensation and that
this should be commensurate with what he or she would have received in the open
market had the expropriation and development not occurred. The intention of
s. 14(4)(b) is to avoid windfall gains or losses to either the owner or the expropriating
authority by screening out any increase or decrease in value resulting from the
expropriation “scheme”. A proper application of this section requires the Tribunal to
consider the probable result of the planning and environmental variables “but for” the
development in respect of which the expropriation was made. In applying it, the Tribunal
must carefully consider the evidence in order to define and delineate the expropriation
scheme by:
[167] Only those actions which impact value, provided they are taken in furtherance of
an expropriation scheme, must be ignored. To ignore other land use planning
considerations that would have occurred in the “but for” would result in the very windfall
gain that s. 14(4)(b) is intended to prevent.
[168] The City and the Claimants took differing approaches in applying s. 14(4)(b)
according to counsel. On behalf of the City, Mr. McDonald delineated the land use
planning actions in the “but for” scenario and determined that the prospects of
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residential development of the subject properties was no better absent the City’s
acquisition plan. Mr. Bower then concluded that the highest and best use was therefore
“speculative” and looked for comparables with similar features to the subject properties
that would be subject to the PPS triggers.
[169] Messrs. Atlin and Robson took the position that the s. 14(4)(b) directs the
appraiser to outright avoid any properties that could potentially be “scheme influenced”;
rather than delineate the scheme to determine the prospects of residential development
in the “but for” scenario. According to counsel, Mr. Atlin relied entirely on the erroneous
planning assumption that OPA 33 would guarantee residential development in SGC and
that this led Mr. Atlin to his highest and best use conclusion of residential development.
He then only chose comparables in South Cameron and South Windsor where values
were not impacted by either natural heritage features or the PPS.
[170] The City maintains that the distinction between ignoring evidence related to the
scheme and ignoring the influence of the scheme on value is not a semantic distinction
and that Mr. Atlin misapplied s. 14(4)(b) by failing to determine whether the scheme, as
defined by Mr. Lehman, had actually resulted in an impact on value. The Act required
Mr. Atlin to conduct this valuation exercise before relying upon South Cameron as the
best comparable.
[171] The Claimants’ lands inside the consolidated ANSI boundary were part of the
“best of the best” natural heritage area and subject to an MNRF ANSI designation even
in the Claimants’ “but for” scenario. To say that the Claimants’ lands were impacted by
the prohibition on development is to presume those lands had development potential in
the absence of the EER that both Dr. Coleman and Mr. Lehman admitted needed to be
completed, but never was. There is simply no evidence that the prohibition on
development which the Claimants urge the Tribunal to accept as the scheme had any
impact on values.
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[172] It was agreed among the experts that the catalyst for development pressure in
the MPA was the construction of the sanitary sewer pipe by the City in 1996. The cost of
that sanitary sewer pipe was borne by the City with assistance from the Province. It is
inconsistent for the Claimants to assert that the City intended to prohibit development in
parts of MPA while acknowledging that the sanitary pipe was constructed in part to
facilitate development.
[173] There is no basis for Mr. Lehman to state that City action sought to preclude
development in SGC because the costs of acquisition were a significant factor that
resulted in the City advocating for as much development as possible in SGC. The City
was therefore a key driver in the reduction of the ANSI boundary and therefore the
impact of the PPS. In the “but for” scenario it is highly unlikely that the Claimants could
have achieved a better result in any secondary planning process.
[174] Rather than demonstrate an intention to prohibit development in the MPA, the
boundary consolidation exercise demonstrates the City’s determined effort to promote
development of as much of the area as the natural features would permit, with “buy in”
from MNRF and ERCA. The consolidated ANSI would protect the “best of the best”
natural features from development while permitting lands outside the consolidated ANSI
to develop without the need for further environmental study.
[175] The purpose of the takings, as supported by the evidence, was to acquire
environmentally sensitive lands into public ownership according to the City. The
expropriation scheme, as the City has defined it, was the acquisition strategy and
Mr. Bower opined that, the acquisition strategy would have no impact on value. If
anything, it benefitted owners of land within the ANSI area by introducing another buyer
– the City – into the market place.
[176] There is no evidence before the Tribunal that the City’s acquisition strategy, or
the expropriation scheme, had a negative impact on the value of land inside or outside
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the consolidated boundary of the ANSI. Mr. Atlin did not bother to prepare this analysis
because his appraisals rely entirely upon South Cameron and South Windsor sales.
[177] Counsel for the City argue that the Claimants downplayed the development risks
in the “but for” scenario and that the City’s actions did not depress the value of the
subject properties, “but for” the expropriations and that the cumulative presence of so
many natural heritage features would require the completion of an EER of significant
scope, and, on a balance of probabilities, it is likely that one or more of the above-noted
natural heritage features would prohibit residential development. A reasonable
purchaser interested in development rather than speculation would have been aware of
these issues and would have invested in other lands in Essex Region rather than taking
the risk in SGC. Furthermore, even if there was some slim possibility that an EER could
find no habitat of threatened species and could demonstrate no negative impacts to the
ANSI, a reasonable purchaser would never pay development prices for the subject
properties given all of the environmental risks.
[179] The Claimants bear the burden of proving on the balance of probabilities that all
requisite planning approvals would be granted. The Claimants simply failed to lead a
clear and credible “but for” planning regime and therefore failed to establish a clear “but
for” valuation case that justified South Cameron as a comparable.
[180] The City argues based on Mr. Conway’s evidence that most knowledgeable
developers considering the marketability of the subject lands for residential
development would likely have understood that the environmental sensitivity of land
would present a major obstacle in gaining planning approvals.
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Market Value
[181] The City argues that Mr. Atlin’s highest and best use conclusion was based on
the premise that, but for the expropriation, the subject properties would have developed
in a manner similar to South Cameron so he therefore avoided SGC entirely and only
chose his comparables from South Cameron. These comparables all comprise single
infill lots that were situated on planned municipal streets that were close to full municipal
servicing and had no environmental risks. Furthermore, some were located on existing
paved streets, some developed and some remain vacant but the planning and
environmental risks that applied to SGC were not present in South Cameron.
[182] Attempts to develop SGC would have required costly studies and almost certain
litigation, with no guarantee that the lots could be developed. Mr. Atlin’s reliance on the
opinions of Dr. Coleman and Mr. Lehman led him to abdicate the appraiser’s job of
determining whether or not the actions of the City actually had a discernable impact on
value.
[183] The City argues that Mr. Atlin’s decision to rely solely on South Cameron is in
error because it values the lands as if the PPS was screened out. He proceeded with
the approach that the scheme may have impacted SGC, so rather than study that effect,
he avoided it altogether by turning to lands in South Cameron with a superior highest
and best use. The land use planning and neighbourhood characteristics of South
Cameron are not comparable to SGC according to the City.
[184] The similarities between South Cameron and SGC presented by Mr. Atlin are
superficial and obscure the material differences between the two neighbourhoods
according to the City. While Mr. Atlin cited fragmentation as a similarity, his
comparables were comprised of properties where servicing was at or near the lot line.
Fragmentation is only a concern in so far as it hinders the orderly development and
servicing of lands. The single infill lots in South Cameron selected by Mr. Atlin are not
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comparable to the swaths of fragmented ownership in SGC where servicing was years
away.
[185] The City’s appraiser Mr. Bower also identified several other material differences
between the neighbourhood characteristics of SGC and South Cameron that would
result in an impact on value such as: SGC being isolated from the remainder of the City
by Huron Church Road and has remained a more rural area as a result; there are few
access roads on to Huron Church Road and few prospects for additional roads given its
status as a provincial highway; and, South Cameron has superior access to retail
services on Tecumseh Road and the Devonshire Mall, whereas the closest retail to
SGC is a modest commercial centre in LaSalle.
[186] The City submits that the Claimants bear the burden of proving the alleged
highest and best use in a land compensation case. In the present case, the Claimants
have either ignored risk factors or presented an optimistic view of overcoming the risks
they actually acknowledge.
[187] The City argues that Mr. Atlin’s planning adjustments are unsupported by the
evidence and do not operate to validate his South Cameron comparables as he did not
rely on independent third party data to support his conclusions, nor did he undertake
any quantitative analysis to demonstrate that the adjustments were reasonable. Rather
he relied on the opinions of Mr. Lehman and Dr. Coleman to arrive at a subjective
valuation ignoring all of the development risks identified by the City’s experts.
[188] The critical flaw in Mr. Atlin’s consolidation premium is that it constitutes double-
counting of a benefit that would have already been factored into the market value of
South Cameron sales. The purpose of consolidation is to allow for the orderly and
efficient financing of services. The built form of Mr. Atlin’s comparables in South
Cameron generally constituted single lots where servicing was already available at or
near the lot line. As a result, a reasonable purchaser has no reason to pay more for
53 LC050010-L050012
assembled lots. Any purchaser can just as easily purchase individual lots with the same
development prospects.
[189] The Claimants’ expert reports suggest that in the “but for” scenario, the City
would have been in a position to exchange lands with the Claimants to allow for
consolidation with Mr. Lehman opining that it is likely that the exchanges would have
occurred on a one-for-one basis. Counsel argue that the City had no motivation to
exchange lands into the environmentally sensitive core areas. The land exchanges that
are mentioned in City documents were for the purpose of taking environmentally
sensitive lands into public ownership and not to allow development on environmentally
sensitive lands. There was also a finite amount of City-owned land to exchange as
there was insufficient linear footage of City-owned land within the MPA, and even
outside it.
[190] Counsel argue that there were factors, which would make any comprehensive
land exchange between the City and the Claimants in the “but for” scenario impossible,
such as: a shortage of City-owned lands, the need to deal fairly with all owners, and
legal restrictions on exchanges for value.
[191] The City argues that there was no reason why it would have been in any better
position to exchange lands with the Claimants in the “but for” scenario than it was in
reality. This position completely ignores the complexity of multiple landowners and
presupposes that the Claimants were the only landowners that the City would have to
deal with.
[192] Mr. Conway opined that given the low exchange value of lands and tight margins
on residential development in the City, there would have been little incentive for a
reasonable purchaser to undertake the time and expense to conduct the requisite
development analysis of SGC. The opinions of the City’s other experts with respect to
natural heritage, servicing, and planning issues all support what was already known to
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the market—that development in SGC was a risky proposition due to natural heritage
issues.
[193] The City argues that the subject property is the best comparable as it does not
have to be adjusted for location, or characteristics of the lands such as natural heritage
features.
[194] Mr. Bower’s approach to value attempted to best replicate the material conditions
of the subject properties. He opined that the data he collected did not demonstrate that
there were any impacts on value resulting from the City’s acquisition policy. He
compared sales located both inside and outside the consolidated ANSI with reference to
the City’s acquisition policy and concluded that there was no evidence to suggest that
the City’s intent to acquire environmentally sensitive lands in SGC resulted in reduction
in value that would trigger s. 14(4)(b) of the Act.
[195] In conclusion, counsel argue that Mr. Bower’s statistical approach is a more
accurate and sound appraisal methodology than Mr. Atlin’s South Cameron approach.
Mr. Bower’s methodology appropriately applied s. 14(4)(b) and actually captures the
characteristics of the subject property relevant to the valuation exercise prescribed by
the Act.
Findings
[196] The Tribunal has considered all of the evidence, as well as the submissions of
counsel on these issues and concludes that the approach to valuation taken by the
Claimants should be followed in arriving at the determination of fair market value of the
subject lands.
[197] The Tribunal finds that the acquisition scheme adopted by the City had an impact
on value of the subject lands by taking away the ability of the Claimants to make
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application to develop their lands for residential use. The Tribunal has already made a
finding that the PPS would not have prohibited development on the subject lands but
would have made it more difficult or challenging to do so, given the environmental
constraints and the requirement for further studies to be provided in support of any
development application.
[198] The Claimants’ properties must be valued based on their residential designation
in existence prior to the implementation of OPA 5. Absent the scheme, the highest and
best use of those lands was for future residential development, subject to potential
environmental constraints.
[199] Mr. Bower concluded that the highest and best use of the lands valued was
“speculation”. In doing so, he adopted a complicated approach to estimating the value
of the expropriated lands, using a statistical analysis of a large number of significantly
dated sales to assess average values for grouped sales. Those values were time-
adjusted to the valuation dates – in some cases by as much as 10 years – and further
adjusted according to a complex averaging process to assess value. He relied primarily
on sales in the MPA and also placed heavy emphasis on sales in the adjacent Town of
LaSalle. These sales were quite dated with the average date of the sales being as much
as 10 years prior to the valuation dates at issue.
[200] He explained that his heavy reliance on sales in the MPA was an attempt to
compare “apples to apples” and that he relied on dated sales in order to avoid any
impacts on value resulting from the City’s announcement to expropriate lands in the
SGC in 2002.
[201] The Tribunal has some difficulty placing any reliance on his evidence in
determining the compensation owed to the Claimants. His heavy reliance on dated
sales undermines their reliability since significant time adjustments he uses are unlikely
to capture current market conditions as of the valuation dates, Mr. Bower appears to
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have undertaken no analysis to define the scheme for which the Paciorkas’ lands were
expropriated and therefore did not consider any impact on market value that may have
been associated with the scheme and which, for the purposes of the Act, is required to
be screened out in assessing value.
[202] Mr. Bower compiled his sales on the basis that there was no impact of the City’s
scheme, and considered the data he reviewed as confirming that conclusion. He did not
attempt to define, isolate or otherwise determine the impacts of the scheme on sales in
the MPA.
[203] The sales in the MPA upon which he placed heavy reliance are tainted by the
impacts on market value of the scheme, during the time frame in which those sales
occur, and which is not adjusted for in his analysis.
[204] Mr. Bower evidently placed no reliance on the expert planning and environmental
evidence prepared on behalf of the City for the purposes of determining the impact the
PPS would have on the market value of the Claimants’ lands. He testified in cross-
examination that he undertook his own analysis and interpretation of the PPS in his
analysis to consider market value; a subject well outside of his expertise as a real estate
appraiser.
[205] Mr. Bower’s reports included a number of errors that were identified during his
cross-examination; many of those errors were present and identified to Mr. Bower
during the hearing on this matter in 2009. They were not corrected in his reports filed in
advance of the 2017 hearing, despite the availability of the transcripts.
[206] Mr. Bower relied on purchases by municipalities including the City and the Town
of LaSalle, through the tax arrears process as part of his analysis. The City’s own
counsel, in cross-examination, stressed the impropriety of relying on such sales in the
valuation exercise as they likely do not accurately reflect market value.
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[207] Mr. Bower’s conclusion that consolidation led to a decrease in the value of the
Claimants’ lands was contradicted by Mr. Stroud, the other appraiser retained by the
City. The sales upon which Mr. Bower relied to support his opinion of lower value for
consolidated lands were not in fact consolidations; many were simply scattered
acquisitions of a large number of lots. Mr. Stroud, who was retained by the City to
review and reply to Mr. Atlin’s work, testified that consolidated lands had a higher value
than individual lots, and that the Claimants’ holdings represented consolidated holdings.
The benefits of plottage or assemblage are well known in valuation and Mr. Bower was
clearly in error to disregard these.
[208] It became evident during Mr. Bower’s cross-examination that a number of his
statements made in this hearing on material points contradicted the evidence he gave at
the 2009 hearing. He appeared to adapt his opinions to reflect the language of other
experts retained by the City in an effort to support the City’s new approach to the case.
[209] Mr. Robson, who was retained to conduct a review of Mr. Atlin’s work, also
provided a review of Mr. Stroud’s report. He expressed some concern that the work
carried out by Mr. Stroud did not comply with the applicable Canadian Uniform
Standards of Professional Appraisal Institute standards for providing a value opinion.
Mr. Robson suggested that Mr. Stroud in carrying out his analysis provided an opinion
as to the value of the lands expropriated from the Claimants without having carried out a
proper analysis as required by the Institute. Mr. Stroud initially strenuously denied
having provided a value opinion in response to this, but ultimately admitted that the
opposite was true.
[210] It was clear from reading his report that he did in fact provide a value opinion
including quoting the standards for when a valuation opinion is provided, using and
signing a certification form that is used only when an opinion as to value is provided,
using headings in his report titled “valuation by the review appraiser”, and assessing
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values per front foot for comparable properties before applying adjustments to the price
per front foot to express a value.
[211] Mr. Stroud’s written report was also quite critical of Mr. Atlin’s reports alleging
that Mr. Atlin had “unquestioningly relied” on Mr. Lehman and Dr. Coleman's opinions.
He advised the Tribunal that he “disagreed” with elements in the Lehman and Coleman
opinions, despite acknowledging that he was not a planner, biologist or ecologist, and
affirming that his Acknowledgement of Expert's Duty required he only give opinion
evidence in his field of expertise.
[212] It became apparent during the course of his cross-examination that his only
disagreement with Dr. Coleman was on the interpretation of the “no negative impact”
test, and his only disagreement with Mr. Lehman was whether OPA 33 could be relied
upon for future development without a new secondary plan.
[213] Those disagreements were despite not having qualifications and expertise held
by Dr. Coleman or Mr. Lehman. His disagreement with these witnesses arose from his
own interpretation of the PPS, rather than relying on a professional qualified in
environmental policy or biology. Despite identifying the need for a new secondary plan
as an insurmountable problem, he then agreed that the process of preparing one might
take approximately 18 months, which is largely in agreement with Mr. Lehman and also
with Mr. Hunt.
[214] As part of the value opinion expressed in his report, Mr. Stroud concluded that
Mr. Atlin’s work required “radical adjustments”. That included a 50% downward
“locational adjustment”, and a further adjustment for environmental risk related to the
PPS.
[215] Mr. Stroud’s locational adjustment was based on what he termed the “stark” or
“vast” differences between South Cameron and the MPA. Those differences arose from
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what he viewed as the differences in access to amenities, and the “rural or semi-rural”
nature of the MPA, contrasted with the “urban” South Cameron and South Windsor
areas. The Tribunal notes that some of the City’s own witnesses acknowledged that
Malden was, in fact, an urban area. Mr. Stroud confirmed that the difference in access
to amenities was only a matter of at most five minutes of driving time and that amenities
tend to follow development. He deferred to Mr. Bower’s knowledge on comparability
given his superior local knowledge. Mr. Bower has referred to South Cameron and
Malden as “reasonably equivalent”, which was consistent with the City’s own position
that prior to the impact of the scheme, the two areas were very similar in terms of land
use, servicing and environmental issues.
[216] Mr. Stroud’s environmental risk adjustment is very similar to Mr. Atlin’s downward
adjustments of 22.5% and 28.5% for environmental risk for the 2005 and 2008
expropriated lands. He acknowledged under cross-examination that his opinion
represents a simple disagreement with Mr. Atlin as to the quantum of the downward
adjustment to be applied to account for the risk of the PPS.
[217] When considering what weight to afford Mr. Stroud’s evidence, the Board need
look no further that his own characterization of his opinion: bizarrely, during cross-
examination and while criticizing Mr. Atlin for failing to be objectively reasonable,
Mr. Stroud repeatedly refused to confirm that his own opinion was objectively
reasonable and asked counsel to explain what that meant, even though it was his own
choice of words. The Board should be guided by Mr. Stroud’s refusal to confirm that his
report was objective or reasonable, and conclude that his evidence lacked the
objectivity, independence, forthrightness and reasonableness to be of any assistance in
the determination of compensation. It should be disregarded and where it conflicts with
the evidence of Mr. Atlin, Mr. Atlin’s evidence should be preferred in all respects.
[218] The Tribunal is satisfied that the City’s acquisition scheme had an impact on
value in this case and should be screened out given its earlier finding respecting the “no
60 LC050010-L050012
[219] The Tribunal prefers the evidence of Mr. Atlin over that of Mr. Bower and will
award compensation in accordance with the valuations provided by Mr. Atlin.
INJURIOUS AFFECTION
[220] The Tribunal notes that the Court of Appeal in its decision found that the Board’s
failure in its 2009 Decision to distinguish between its approach to market value
assessment under s. 14(4)(b) and its approach to the assessment of injurious affection
damages resulted in a fundamentally flawed assessment of those damages and
demonstrated that the Board treated the entire expropriation scheme as crucial to both
market value under s.14(4)(b) and to the calculation of loss in value of the remaining
lands for the purposes of the injurious affection claim under s. 13(2)(c). It found that the
Board should have focused exclusively on damages caused to the remaining properties
by the City’s acquisition of the related lands instead of focusing on the expropriation
scheme.
Claimants’ Argument
[223] The Claimants claim damages for injurious affection as they continue to own
lands outside of the consolidated SGC referred to as the remaining lands. These
include lands referred to as portions of the northwest and southeast consolidations,
which remain in the ownership of Bruce Paciorka, Gordon Paciorka and Paciorka
Leaseholds Limited. A portion of the southwest consolidation remains in the ownership
of Elizabeth Frey. The Claimants argue that those lands were contiguous with, and their
use was enhanced by the unified ownership with the other lots forming their respective
consolidations.
[224] The Claimants claim that these remaining lands have suffered a reduction in their
market value as a result of the City’s adjacent expropriations and that this reduction in
market value represents a loss to them, which is compensable as damages for injurious
affection. Their holdings were reduced from 375 to 187 lots, made up of a number of
individual holdings but given the context of the area, these should be seen as a single
holding because it has been the practice to trade/exchange lots in this area according to
Mr. Lehman, the land use planning consultant, who testified in support of the Claimants.
[225] Mr. Lehman’s opinion was generally that even though a lot may be located in an
area with no adjacent properties owned by the same owner, that lot could be added to a
City’s lot increasing the land holding. Taking away the flexibility that exists by reducing
the holding almost in half reduces the flexibility significantly. In this case, the Claimants
were developing a subdivision and needed to provide a 5% parkland dedication as part
of the land development process and could have used the lots in the southeast or the
southwest, presumably as part of that dedication.
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[226] The appraisers who testified on behalf of the Claimants also commented on the
benefits of “plottage” or “assemblage” as described by Mr. Lehman. They were
generally of the view that in an area with a land ownership pattern such as the MPA, the
more the lands are assembled into a continuous block allows for a more meaningful
parcel of land for development purposes. This allows for a greater degree of flexibility in
terms of development options and according to Mr. Spencer, the professional engineer
with an expertise in civil engineering issues, who was retained by the Claimants allows
for servicing costs to be spread over a greater number of benefiting properties.
[227] Counsel for the Claimants argue that the loss of the benefits of “plottage” as a
result of an expropriation is recognized as injurious affection that is compensable
pursuant to the Act. The loss of development advantages associated with a larger
holding, particularly a holding such as the Claimants which is one of the largest in a
given area by way of expropriation, can have a marked and negative impact on the
market value of the remainder lands. That impact varies on the basis of the
expropriation with which it is associated in this case.
[228] Ms. Frey retained ownership of seven lots totalling 262 front feet after the April 7,
2004 expropriations. The City had expropriated 21 lots from Ms. Frey reducing her
holding by approximately 75%. The appraisers opined that the configuration of the
remaining lands in conjunction with the surrounding boundaries of the SGC serve to
reduce the value of those lands drastically. The remaining holding is quite small and any
future development would be required to incorporate “single-loaded roads” on the basis
of the current plan of subdivision. Given such considerations, the loss in market value
occasioned to Ms. Frey’s remaining lands is substantial according to appraiser Mr. Atlin,
who has estimated the loss to be in the order of 50% and calculated to be $50,000 as
the reduction in market value caused to Ms. Frey’s remaining lands by the City’s
expropriation.
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[229] The northwest consolidation owned by Bruce Paciorka, Gordon Paciorka and
Paciorka Leaseholds Limited represented their largest concentration of lots prior to the
City’s expropriations. After the expropriations on December 28, 2005, the Claimants
remained in ownership of 4,884 front feet of consolidated lands and 245 front feet of
non-consolidated lands.
[230] The impacts on the Claimants’ 2005 remaining lands are less severe than those
affecting Ms. Frey’s remaining lands, but are nonetheless significant. The northwest
consolidation has been reduced by 1,977.25 frontage feet of consolidated land and
more than 2,000 front feet in total. The loss of that significant proportion of the
consolidation results is the loss of “plottage” advantage and a reduction in market value.
Mr. Atlin has calculated that reduction to be 12.5% of the market value of the remaining
lands, totalling $235,000 representing his reasonable estimate of the injurious affection
arising from the City’s 2005 expropriation.
[231] The City’s final expropriations on January 29, 2008 from the Claimants’
southeast consolidation left 420 consolidated front feet and 220 non-consolidated front
feet in the ownership of the Claimants representing a loss of approximately 50% of the
southeast consolidation according to Mr. Atlin.
[232] The same loss of “plottage” advantage related to the reduction from a larger
holding to the smaller remainder arises with respect to these lands; Mr. Atlin estimated
the reduction to be 12.5%. Counsel argue that the resulting loss of $23,000 is
compensable as injurious affection pursuant to the Act and should be awarded to the
Claimants.
[233] Counsel argue that the Claimants have experienced a total loss to market value
of their remainder lands in the amount of $308,000 attributable to the expropriations
carried out by the City and constitutes injurious affection pursuant to the Act.
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City’s Argument
[234] The Court of Appeal decision held that it was an error to calculate injurious
affection by reference to a loss caused by the expropriation scheme. The Act requires
that a claimant demonstrate that their remainder lands actually suffered a loss due to
the acquisition of the expropriated lands.
[235] Firstly, the Claimants’ position on injurious affection is based entirely on the
assumption that all of the subject properties would have been developable. This is
essentially the same position taken by the Claimants in the 2009 hearing and relies
entirely upon the alleged scheme according to counsel.
[236] The Tribunal would have to accept all of the inconsistencies in the Claimants’
case as set out above in order to find that the subject properties would have been
developable in the manner similar to South Cameron. On that basis alone, Mr. Atlin’s
adjustment assumptions for servicing and single-loaded roads are entirely irrelevant and
there is no supportable claim for injurious affection.
[237] Secondly, even if it is assumed that some theoretical portion of the subject
properties could be developed, Messrs. Atlin and Lehman did not do the work in
determining how the injuriously affected lots would develop. The City’s participation in
the boundary consolidation exercise carved away approximately 30% of the MNRF’s
1994 ANSI and released 134 lots owned by the Claimants that were previously located
in the 1994 ANSI. Mr. Atlin did not prepare a baseline valuation to determine whether
the allegedly injuriously affected lots had gone up or down in value based on the City’s
actions.
[238] Counsel argue that on the contrary, the evidence suggests that the allegedly
injuriously affected lands only benefitted from the City’s actions. Mr. Bower opined that
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the remainder lands would benefit from no longer being encumbered by the
environmental restriction of the ANSI.
[239] Mr. Atlin’s injurious affection analysis ignored the fact that the City’s actions
removed 134 of the Claimants’ lots from the ANSI. He simply assumed that the entirety
of the Claimants’ landholdings would have been fully developable, while, Mr. Lehman
could not advise the Tribunal what portions of the subject properties could be developed
and at what yield.
[240] Third, and in the alternative, if the Tribunal accepts that the remainder lands
suffered some injurious affection, Mr. Atlin’s 50% adjustment for injurious affection is
excessive and unsupported on the evidence. The consistent theme of Mr. Atlin’s
adjustments has been a lack of quantitative data supporting his quantum. On cross-
examination, he admitted that this number was based entirely on his judgment. He did
not consider alternative street arrangements or planning solutions to find efficiencies in
the development of the remainder lands.
[241] As a direct result of the boundary consolidation exercise, at least 134 of the
Claimants’ lots were released from the 1994 ANSI boundary and available for
development. The Claimants now seek over $300,000 in compensation from the City for
injurious affection to these lands when these were the direct beneficiary of the City’s
participation in the exercise.
Findings
[242] The Tribunal finds that the Claimants’ remaining lands have suffered a reduction
in their market value as a result of the City’s adjacent expropriations. That reduction in
market value represents a loss to the Claimants which is compensable as damages for
injurious affection.
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[243] The Tribunal agrees with the Claimants’ contention that the remaining lots should
be seen as a single holding because it has been the practice to trade/exchange lots and
that taking away the flexibility that exists by reducing the holding almost in half, reduces
the flexibility significantly. If the Claimants were developing a subdivision and needed
5% parkland dedication, they could have used the lots in the southeast or the
southwest, presumably as part of that dedication for example.
[244] The Tribunal agrees with the appraisers who testified on behalf of the Claimants,
who commented on the benefits of “plottage” or “assemblage” as described by
Mr. Lehman. In an area with a land ownership pattern such as the MPA, the more lands
assembled into a continuous block allows for a more meaningful parcel of land for
development purposes. It allows for a greater degree of flexibility in terms of
development options and, as Mr. Spencer, the civil engineer, described allows for
servicing costs to be spread over a greater number of benefiting properties.
[245] Furthermore, the Tribunal agrees that the loss of the benefits of plottage as a
result of an expropriation constitutes injurious affection that is compensable pursuant to
the Act. The loss of development advantages associated with a larger holding,
particularly a holding such as the Claimants’ which is one of the largest in a given area,
by way of expropriation has had negative impact on the market value of the remainder
lands.
[246] The Tribunal finds that the reduction in size and change in configuration of
Ms. Frey’s remaining holdings resulting from the expropriation has served to reduce the
value of those lands significantly, given that the remaining holding is now quite small
and any future development would be required to incorporate “single-loaded roads” on
the basis of the current plan of subdivision as argued by counsel. The Tribunal finds
that the loss in market value occasioned to Ms. Frey’s remaining lands is calculated to
be $50,000.
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[247] With respect to the northwest consolidation owned by Bruce Paciorka, Gordon
Paciorka and Paciorka Leaseholds Limited, the expropriation in 2005 has resulted in the
loss of plottage advantage and a consequent reduction in market value. The Tribunal
agrees with Mr. Atlin’s opinion of a reduction of 12.5% of the market value of the
remaining lands, totalling $235,000. This represents a reasonable estimate of the
injurious affection arising from the City’s 2005 expropriation and is awarded as
compensation pursuant to the Act.
[248] The January 29, 2008 expropriation from the Claimants’ southeast consolidation
resulted in a loss of approximately 50% of the southeast consolidation with again a
consequential loss of plottage advantage related to the reduction from a larger holding
to the smaller remainder arise with respect to these lands. The Tribunal agrees with
Mr. Atlin’s estimated reduction of 12.5% resulting in a loss of $23,000. This amount is
compensable as injurious affection pursuant to the Act and will be awarded to the
Claimants.
[249] As to the City’s suggestion that the Claimants’ remaining lands have experienced
a benefit in that the ANSI designation was removed from these lands as part of the
boundary consolidation process and that this benefit has increased the market value of
those lands, the Tribunal does not agree with the contention that the City should be
credited with a set-off for the quantum of that benefit.
[250] The Tribunal agrees with counsel for the Claimants that there has been no such
benefit for which the City would be entitled to a set-off. Section 23 of the Act provides
that the advantage to the remaining land of an expropriated owner caused by the works
for which lands were expropriated shall be set off against any award for injurious
affection. Such a set-off does not apply to set-off an award of compensation for the
market value of expropriated lands.
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[251] Mr. Atlin indicated that the removal of some of the Claimants’ lands from the
ANSI boundary as part of the SGC boundary adjustment process would leave those
lands better off. As part of his analyses, he applied adjustments between 5% and 28.5%
for environmental risk associated with the ANSI boundary and respective PPS. The
removal of those elements would necessarily lead to the removal of that risk
adjustment.
[252] The removal of that risk adjustment does not, however, constitute a benefit or
“betterment” that the City is entitled to set off against the damages for injurious affection
experienced by the Claimants. In order for a benefit associated with the works for which
land is expropriated to be eligible for set off against injurious affection damages, it must
be special or distinct to those lands and their owner. It cannot be a general betterment
or benefit that is similarly experienced by adjacent owners.
[253] The betterment suggested by the City in this case is a general betterment and
not special or distinct to the Claimants’ remaining lands. Both of the City’s appraisers,
Messrs. Bower and Stroud, confirmed on cross-examination that other adjacent owners
experienced the same benefit by way of the SGC boundary consolidation. One of those
beneficiaries is the second-largest private landowner in the area, South Windsor
Development Company. Mr. Stroud confirmed that the fixing of the boundary for the
SGC and its attendant benefits was a part of the scheme for which the Paciorkas’ lands
were expropriated. Mr. Bower confirmed that, in fact, the City was the greatest
beneficiary of the boundary consolidation and any benefits associated with it.
[254] Given that any benefits experienced by the Claimants remaining lands were
shared with many other owners in the MPA, including the City itself, there is no special
or distinct benefit accruing to the Claimants. The City is therefore not entitled to a set off
pursuant to s. 23 of the Act.
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[255] The Tribunal does not accept the City’s contention that it should be awarded a
set-off due to the Claimants’ remaining lands having derived a benefit as a result of the
ANSI designation being removed from these lands as part of the boundary consolidation
process. Section 23 of the Act provides that the advantage to the remaining land of an
expropriated owner caused by the works for which lands were expropriated shall be set
off against any award for injurious affection. Such a set-off does not apply to set-off an
award of compensation for the market value of expropriated lands.
[256] Mr. Atlin agreed that the removal of some of the Claimants’ lands from the ANSI
boundary as part of the SGC boundary adjustment process would leave those lands
better off. This removal, however, does not constitute a benefit or “betterment” that the
City is entitled to set off against the damages for injurious affection experienced by the
Claimants. In order for a benefit associated with the works for which land is expropriated
to be eligible for set off against injurious affection damages, it must be special or distinct
to those lands and their owner. It cannot be a general betterment or benefit that is
similarly experienced by adjacent owners.
[257] The betterment touted by the City in this case is a general betterment and not
special or distinct to the Claimants’ remaining lands. Both of the City’s appraisers,
Messrs. Bower and Stroud, confirmed on cross-examination that other adjacent owners
experienced the same benefit by way of the SGC boundary consolidation. One of those
beneficiaries is the second-largest private landowner in the area, South Windsor
Development Company. Mr. Stroud confirmed that the fixing of the boundary for the
SGC and its attendant benefits was a part of the scheme for which the Claimants’ lands
were expropriated. As for Mr. Bower, he confirmed that, in fact, the City was the
greatest beneficiary of the boundary consolidation and any benefits associated with it.
[258] Given that any benefits experienced by the Claimants’ remaining lands were
shared with many other owners in the MPA, including the City itself, there is no special
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or distinct benefit accruing to the Claimants. The City is not entitled to a set off pursuant
to s. 23 of the Act.
[259] In summary, the Tribunal finds that the remaining lands owned by the Claimants
have suffered damages as a result of the expropriation and awards damages as follows:
[260] The Paciorkas have experienced a total loss to market value of their remaining
lands in the amount of $308,000. That loss is attributable to the series of expropriations
carried out by the City and constitutes injurious affection pursuant to the Act. The
Tribunal will award compensation to the Claimants accordingly.
DISTURBANCE DAMAGES
Claimants’ Argument
[261] The Claimants claim disturbance damages for two items pursuant to clause
13(2)(b) and section 18 of the Act:
Interest on Financing
[262] Bruce Paciorka explained during the course of his testimony that these
proceedings have been a significant strain on the Claimants, their families and their
business, both personal and financial. He explained that prior to the City’s
expropriations, the business carried on by the Claimants was debt free and that in order
to pursue their claim for compensation, they were required to obtain substantial
financing in the form of bank loans to pay legal, expert and other fees. Those loans
have accrued, and continue to accrue, substantial interest as these proceedings
continue. As of November 10, 2017 that interest amounts to $154,154.79 according to
the records filed outlining loan interest paid by the Claimants to fund this litigation.
[263] Counsel argue that this Tribunal has awarded disturbance damages for such
interest in the past as properly compensable pursuant to the Act and should do so here.
[264] Counsel argue that throughout these proceedings the Claimants have been
faced with a choice between accepting an offer of compensation from the City that they
believe significantly undervalues their lands and is in conflict with the valuation evidence
prepared by their own experts, and evidently also valuation evidence available to the
City at the time the offers were made. The Claimants were largely successful at the
hearing before the Board in 2009 and cannot be faulted for defending that award in the
Divisional Court and Court of Appeal.
[265] Given the various appeals and the significant amount of time, it cannot be
considered unusual that the Claimants have been required to seek financing for their
costs to pursue fair compensation. In order to be made whole and placed in as close to
the same position as they would have been in had the City not expropriated their lands,
counsel argue that the Claimants should be awarded the amount of $154,154.79 in
accordance with s. 18 of the Act representing compensation for interest paid.
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Executive Time
[266] The Claimants have been required to expend a significant amount of their own
time in addressing these proceedings. Bruce Paciorka and Gordon Paciorka are both
Claimants and co-owners of their business Paciorka Leaseholds Limited, which is also a
Claimant in these proceedings and is the entity through which they carry on business.
Both Mr. Bruce Paciorka and Mr. Gordon Paciorka have been required to divert a
substantial number of hours toward these proceedings, which could otherwise have
been spent on their business. They claim compensation for that executive time as
disturbance damages in the amount of $21,355.
[267] It is noted that the Claimants made a similar claim at the first hearing of this
matter in 2009 and were awarded compensation for their executive time at a rate of
$100/hour. That award was not appealed and the Claimants received payment from the
City.
[268] The Claimants prepared and filed an executive time log itemizing their time spent
to bring this matter to a second hearing. That log evidences that Mr. Bruce Paciorka and
Mr. Gordon Paciorka have spent 213.55 hours on this proceeding up to the date of the
second hearing beginning in November 2017. That quantum does not include the hours
spent by the Claimants on the hearing in November/December 2017. It is also noted
that the number of hours expended by the Claimants was not seriously challenged in
cross-examination.
[269] Using the $100/hour rate awarded at the 2009 hearing, the Claimants are entitled
to compensation for their further executive time in the amount of $21,355. Absent the
expropriations by the City and the proceedings arising therefrom, the Claimants would
not have been required to dedicate that time to this matter. Their time records are
detailed and fully support the amount of hours expended.
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City’s Argument
[270] Counsel argue that the Claimants have only submitted two pieces of evidence in
respect of these claims: in examination in chief, Mr. Paciorka also stated that he would
claim time for his attendance at the hearing. Mr. Paciorka has provided no hourly rate
for his time and no hourly rate is pleaded in the various Statements of Claim.
[271] The Claimants have pleaded unspecified damages for disturbance and out-of-
pocket expenses. A claimant must demonstrate, on a balance of probabilities, that the
losses claimed were the “natural and reasonable consequences of the expropriation”.
Loan Interest
[272] Counsel for the City argue simply that the decision by the Claimants to finance
litigation through loans was a business decision made by the Claimants and not
causally related to the expropriations.
Executive Time
[273] The City argues that the time claimed is not supported by the evidence. First, it is
entirely unclear from the record what loss was actually suffered by the Claimants. There
is no evidence in the record to suggest that Mr. Bruce Paciorka or Mr. Gordon Paciorka
were deprived from paid employment due to their decision to become highly involved in
the case. On cross-examination, Mr. Bruce Paciorka admitted that he has been retired
with a pension since 1997, well before the Valuation Dates. Second, there is no
explanation as to why the expropriations deprived the Claimants any other source of
income.
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[274] The time log also indicates that the Claimants took an especially active role in
their case that went beyond simply advising their consultants. They attended at expert
meetings, reviewed expert reports, travelled to Toronto to consult with their lawyers, and
reviewed the City’s expert reports. The Claimants also seek significant executive time
from May 2009 to December 2012. This was the period of the civil appeals that was
unrelated to the Tribunal’s determination of compensation. To the extent that any losses
are compensable, the amount claimed is excessive and the period from May 2009 to
December 2012 should be denied outright.
[275] The City submits that there is no basis upon which to find that the Claimants
would have earned additional income following the 2009 hearing, but for the
expropriations. The decision to finance litigation through loans was a business decision
made by the Claimants and not causally related to the expropriations.
Findings
[276] Firstly, with respect to the claim for interest, the Tribunal finds that this is an
appropriate claim and that the Claimants should be compensated the borrowing costs
they incurred.
[277] Given the various appeals and the significant amount of time, it cannot be
considered unusual that the Claimants have been required to seek financing for their
costs to pursue fair compensation. These interest charges are the natural and
reasonable consequences of the expropriations by the City. But for the City’s
expropriations, the Paciorkas would not have been required to retain counsel and
experts to pursue their claim. The claim will therefore be allowed in the amount of
$154,154.79 plus any adjustments, which are required to bring this amount up to date.
[278] Secondly, with respect to executive time claimed, the Tribunal finds that this is a
proper claim and that the Claimants should be compensated.
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[279] The Tribunal notes that the Claimants made a similar claim at the first hearing of
this matter in 2009 and were awarded compensation for executive time at a rate of
$100/hour. That award was not appealed and the Claimants received payment from the
City. There is no reason why they should not be compensated in the same manner for
their time spent on this hearing.
[280] In order to be made whole in accordance with the Act, the Claimants should be
awarded compensation for their executive time as they were at the hearing before the
Board in 2009.
[281] The Claimants are therefore awarded the amount of $21,355 as compensation
for the executive time spent on this matter subject to adjustment in order to reflect the
time spent at the hearing in 2017 and 2018. The Tribunal notes that the City’s concerns
with respect to the time claimed between May 2009 and December 2012, which was the
period during which the civil appeals were litigated. The Tribunal finds that the
Claimants should be compensated for reasonable time expended by them to instruct
counsel with respect to the appeals before the Divisional Court and Court of Appeal.
STATUTORY INTEREST
Claimants’ Argument
[282] The Claimants take the position that they are entitled to interest on outstanding
compensation for the market value of the expropriated lands and on any damages
awarded for injurious affection in accordance with s. 33 of the Act. Interest is payable
commencing on the date that the lands ceased to be of productive use due to their
eventual acquisition. That date is prior to the date of the actual expropriation if the
productive use of the lands ceased at an earlier time. There is no requirement that
expropriation be a certainty in determining the cessation of the lands productive use.
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Where lands are held for the purposes of development, they cease to be of productive
use on the date that the potential for eventual development is lost as a result of their
eventual acquisition.
[283] The Claimants argue that their lands ceased to be of productive use on
June 8, 1995. They had purchased their lands in the MPA and held these for the
purposes of eventual development; any development potential was lost as of that date,
when the study group considering the boundary of the SGC fixed a boundary at their
meeting on June 8, 1995. That boundary never changed and development was to be
prevented on the lands within the boundary and they would be acquired from the private
owners for the purpose of protecting these. Despite changes to provincial policy with
respect to the potential for development within the boundary, the ultimate aim of the City
was to prevent development and acquire the lands within it for that purpose.
[284] As of the date the boundary was fixed, the lands within it ceased to have hope for
development and ceased to be of productive use. Given the desire to protect and
eventually acquire the lands within the boundary, the City would not allow development
to proceed within its limits and undertook a series of further planning steps in order to
effect that aim. Mr. Stroud admitted under cross-examination that the fixing of the
consolidated SGC boundary fixed the commencement of the scheme and attempts after
that date to develop the lands were stymied by the City.
[285] The cessation of productive use was a result of City’s intent to acquire the lands,
eventually implemented through the expropriations that are the subject of this
proceeding. Interest on outstanding compensation for market value should be
calculated from June 8, 1995 to the date compensation is eventually paid, at the rate of
6% per annum.
Development Plan, prepared by Dillon Consulting Limited in June 1997, was received
by the City to guide future development in the MPA. The Plan recommended a change
in the land use planning designation for lands within the SGC from their existing
Residential designation to Natural Heritage. The change in designation would preclude
development on the lands subject to the Plan. The Plan also included provision for
“securement”, or acquisition, of the lands within the SGC by the City, which was later
adopted by the City on December 13, 1999. The Plan was ultimately incorporated into
the City’s Official Plan by way of OPA 5.
[287] The Board in its 2009 decision determined that this was the date the owners lost
productive use of their lands. In the alternative that the Board does not agree that the
lands ceased to be of productive use on June 8, 1995, then interest should be awarded
commencing on the date that the Dillon Development Plan was accepted by the City on
August 11, 1997, at the statutory rate of 6% per year.
[288] Ms. Frey’s lands were expropriated by the City on April 7, 2004. She was not
however, provided with a formal offer of compensation for the expropriation of those
lands, in accordance with s. 25 of the Act, until July 26, 2006. She had previously
retained Mr. Bower to appraise her lands and the City was of the view that it required an
appraisal from a different appraiser in order to avoid a potential conflict of interest.
There were delays to the finalization of that appraisal on behalf of the City. In the
interim, the City did not approach Ms. Frey about waiving any potential conflict or other
measures to expedite the preparation of an appraisal. It was not until counsel for
Ms. Frey reached out to the City directly that the matter was resolved.
[289] In the intervening period of approximately two years, Ms. Frey had no access to
interim compensation for the taking of her lands by the City. She did not even have an
offer to consider for the expropriation of those lands, or a position from the City as to the
estimated market value. That delayed both the payment of interim compensation and
the determination of compensation for the expropriation of those lands. Counsel argues
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that the City should be penalized for its delay in delivering the s. 25 offer to Ms. Frey by
an increase of the interest payable on outstanding compensation owed to her in the
amount of 12% per year for the period from April 7, 2004 to July 26, 2006 in accordance
with s. 33(4) of the Act.
City’s Argument
[290] The City argues that the Claimants’ conduct in this case warrants a variation for a
portion of any statutory interest that may be payable to the Claimants and specifically
seeks a variation of interest from the period of October 5, 2015 to the date of the
Tribunal’s order. It relies on the Tribunal’s decisions in Shergar Development Inc. v
Windsor (City), 2018 CanLII 3074 (ON LPAT) (“Shergar Development”) and Re/Max
Sudbury Inc. v. Sudbury (City), 2004 Carswell Ont 7496 (“Re/Max Sudbury Inc.”).
[291] In Shergar Development, supra, the Board lowered interest when the claimants’
unnecessarily advanced civil claims challenging the validity of the expropriation. Those
claims were found to be without merit and delayed the determination of compensation
for almost a decade. Similarly, in Coltman v. Metropolitan Separate School Board
(No. 2), 1975 Carswell Ont 1315, 9 L.C.R. 197, the Board denied statutory interest
where a claimant challenged the expropriation by petition to the legislature rather than
advancing his case before the Board.
[292] In Re/Max Sudbury Inc, supra, the Board denied interest to the claimant for a
four-year period where it could provide no good reason for failing to advance its claim.
[293] The City points to s. 33(2) of the Act, which provides the Board with broad
discretion to vary the amount and time of a claimant’s statutory interest entitlement for
causing unreasonable delay to the determination of compensation.
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[294] The Claimants’ conduct in this case warrants a similar variation for a portion of
any statutory interest that may be payable to the Claimants. The City seeks a variation
of interest from the period of October 5, 2015 to the date of the Tribunal’s order.
[295] The City argues that this matter could have been adjudicated before the Tribunal
on October 5, 2015, as scheduled. The parties had prepared expert reports and
undertook an unsuccessful two-day mediation. In July 2015, Mr. Bruce Paciorka swore
an affidavit July 29, 2015 accusing the City of causing delay that would threaten the
October 5, 2015 hearing and advised that he did not want to amend his pleadings or
conduct further discoveries. His former counsel also accused the City of delay and
urged that there was sufficient evidence in the record from the 2009 hearing to proceed
with the hearing.
[297] Discoveries proceeded in May 2016. The Claimants were unsatisfied with the
City’s answers and sought additional discoveries that occurred in March 2017. This
necessitated a further adjournment of the hearing until October 30, 2017. The Claimants
had an additional round of discoveries of Mr. Hunt in March 2017.
[298] The City argues that while the Claimants are entitled to have a fair opportunity to
make their case, the record demonstrates that the Claimants’ delay to seek additional
productions did nothing to assist in the determination of compensation. Upon receipt of
the Claimants’ expert reports, the City noted that almost no documentary evidence from
the discovery process was cited in the Claimants’ reports. Furthermore, many
conclusions in the Claimants’ expert reports were based on conjecture that was refuted
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by documentary evidence. Counsel for the City maintains that the Claimants continued
with frivolous productions issues during the hearing and cited what they considered to
be a number of examples of such conduct.
[299] Counsel argue that the purpose of the discovery process is to adduce evidence
relevant to the issues in dispute. The efforts should be proportionate in a manner that
ensures fairness, but does not result in delay or wasted resources. Discovery is not
intended to seek some needle-in-the-haystack silver bullet that may or may not exist.
Findings
[301] The Tribunal finds that the Claimants are entitled to interest at the statutory rate
of 6% from August 11, 1997, which is the date on which the Tribunal found that the
subject properties ceased to be of productive use. The Tribunal is not persuaded by the
arguments of counsel for the City that somehow the Claimants’ conduct resulted in
unreasonable delays. This Member is quite familiar with the facts in Shergar
Development, supra, and can say without qualification, that the facts of this case do not
fall into the category of conduct outlined in in that case. Furthermore, the adjournment
of the hearing set to commence was caused largely as a result of a serious injury to the
Claimants’ previous counsel, who could not continue with the case as a result of those
injuries. The Claimants were put in a position where they had to retain new counsel.
The Claimants chose to follow a different approach to advancing their claims on the
advice of their new counsel as was their right.
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[302] The Tribunal also does not accept counsel for the City’s argument that somehow
the Claimants abused the discovery process by making requests for disclosure of
documents, which counsel described as excessive and out of proportion with the
probative value of any evidence adduced causing an inordinate waste of resources on
the part of City staff, counsel, and its consultants and did nothing to assist in the
determination of compensation.
[303] The Tribunal finds that the Claimants were entitled to have discovery of such
documents in order to advance their claims and properly exercised those rights. It is
irrelevant that they chose not to use all or some of those documents at the hearing of
these claims.
[304] With respect to the claim by Ms. Frey, the City should be penalized for its delay
in delivering the s. 25 offer to Ms. Frey as described above. The Tribunal will therefore
increase the rate of interest payable on the outstanding compensation owed to her.
Ms. Frey to interest at the rate of 10% from the date of expropriation on April 7, 2004 to
July 26, 2006, when the City made her an offer of compensation in accordance with the
Act.
COSTS
[305] Section 32(1) of the Act provides that 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%, or more of the amount offered
by the 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.
[306] Section 32(2) of the Act provides that where the amount to which an owner is
entitled upon an expropriation or claim for injurious affection is determined by the
82 LC050010-L050012
Tribunal and the amount awarded by the Tribunal is less than 85% of the amount
offered by the authority, the Tribunal may make such order, if any, for the payment of
costs as it considers appropriate.
[307] The City argues that it should be afforded and opportunity to make submissions
respecting the payment of costs and be permitted to lead evidence of any subsequent
offers to settle following the issuance of the Tribunal’s decision on the merits.
[308] Accordingly, the Tribunal will remain seized of this matter for the purpose of
determining costs pursuant to s. 32 of the Act and will set the procedure, including a
hearing date to fix the costs associated with these claims.
ORDER
[310] It is so ordered.
“R.G.M. Makuch”
R.G.M. MAKUCH
VICE-CHAIR
BE TWEEN:
- and-
16 of the Fresh as Amended Statement of Claim dated November 17, 2015 (the "Fresh as
Claim.
3. The Respondent expressly denies all other paragraphs in the Fresh as Amended Statement
Background
4. The Claimants are the owners of lands in the City of Windsor in an area known as the
Malden Planning Area. The lands were subdivided in the 1920s and are held by the
the lands in question were never serviced or developed. As of the valuation date, these
84 year old lotting patterns no longer facilitated development and new plans of
5. As part of the Ojibway Prairie Remnant, this area is inhabited with a unique and diverse
biological community including 509 recorded plant species, 36 of which are considered
rare in Ontario.
6. Rare mammals such as the Gray Fox and Eastern Chipmunk inhabit the area. Reptiles
present include the Eastern Massassauga Rattlesnake and the Butler's Garter Snake,
which are threatened species and rare in Ontario. The complex also provides high quality
habitat for nesting raptors, fox, coyote, white-tailed deer and large reptiles such as eastern
7. As at the Valuation Date described herein, all of the lands expropriated, as well as some
of the remaining lands, qualified as an ANSI area using provincial criteria. Furthermore,
as of the Valuation Date:
a. Significant portions of the habitat for threatened and endangered fauna and flora
species were present on the expropriated lands and much of the remaining lands;
b. Significant habitat for endangered species and threatened species was present
throughout the expropriated lands and much of the remaining lands; and
3
significant wetland complex and their adjacent lands occurred throughout much of
8. As far back as 1983, these features were recognized by local and provincial authorities. In
1983, 115 acres were designated an Environmentally Significant Area by the Essex
Region Conservation Authority (the "ERCA"). In 1984, and in accordance with Province
Wide Standards, the Provincial Ministry of Natural Resources ("MNR") designated 248
9. In 1994, MNR expanded the boundary of the ANSI to encompass roughly 420 acres,
including all of the lands within the Provincial ANSI boundary that existed on the
10. The Claimants' Lands were, as of the Valuation Date defined herein, subject to other
Province wide legislation aimed at preserving natural heritage features. The Respondent
pleads and relies on the Provincial Policy Statement issued on May 22, 1996, and
amended February 1, 1997 (the "PPS"), which created a stand-alone, Province wide
Claimant's Lands.
11. The introduction of the PPS was anticipated by earlier Provincial Policy. For example,
Claimants' Lands - was prohibited. The Respondent pleads and relies on the Provincial
Wetlands Policy Statement, issued under the authority of Section 3 of the Planning Act,
on May 14, 1992, and on the Comprehensive Set of Policy Statements ("CSPS"), issued
4
by the Province on March 28, 1995. These and other Provincial Guidelines and Policy
Statements that pre-date May 22, 1996 are hereinafter described as Precursor Policies.
12. The Claimants' Lands were, as of the Valuation Date defined herein, also subject to
federal legislation. The Respondent pleads and relies on, inter alia, the Species at Risk
Act, S.C. 2002, c. 29, which was enacted to prevent wildlife species from becoming
extirpated or extinct, and which received royal assent on December 12, 2002. The
Respondent also pleads and relies on the Migratory Birds Convention Act, 1994, S.C.
1994, c. 22, which also applied to the Claimants' Lands and would have prevented or
The Expropriation
13. The Respondent served Notices of Approval to Expropriate in 2003, and Plan of
expropriation of the following lands from the Claimants (the "Expropriated Lands"):
a. The lands owned by the Claimant, Bruce Paciorka, described as Part 60 on the
Parts 5, 6, 7, 8, 12, 13, 15, 20, 34, 35, 36, 37, 42, 43, and 44 on the Plan of
Expropriation.
14. The purpose of the expropriation was to preserve a natural area and critical habitat for
endangered and threatened species to be known as the Spring Garden Area of Natural and
Scientific Interest.
5
The Prior Decisions of the Board and the Court of Appeal and the Requirement to Account
for the Impact on Value of the PPS
15. On December 2, 2009, the Ontario Municipal Board (the "OMB" or the "Board") issued
a decision wherein the Board awarded the Claimants compensation for the market value
of the Expropriated Lands, injurious affection to the lands remaining in the Claimants'
ownership, disturbance damages to Bruce Paciorka and an award of interest on the unpaid
16. The Respondent appealed the OMB Decision to the Divisional Court. On May 16, 2011,
the Divisional Court (Herman, Havison Young JJ., Sachs J. dissenting) dismissed the
17. On October 31, 2011, the Respondent sought and was granted leave to appeal the
18. The primary issues before the Ontario Court of Appeal were whether the Board had
properly considered the PPS in reaching its determination of market value and whether
the Board misapplied s.14(4)(b) in reaching its conclusion that the lands remaining in the
19. The Court of Appeal concluded that the Board erred on both counts. It held that the PPS
was not part of the expropriation scheme and ought not to be ignored pursuant to subs.
20. The Court of Appeal further held that the Board erred in awarding damages for injurious
affection by measuring the impact on the value of the remaining lands caused by the
6
expropriation scheme rather than assessing the impact, if any, on the value of the
21. As a result, the Court of Appeal set aside the order of the Divisional Court and the order
of the Board and directed a new hearing before a differently constituted panel of the
Board.
Valuation Date
22. The Respondent states that the date for determination of compensation is April 7, 2004
(the "Valuation Date"), the date the Respondent registered the plan of expropriation.
23. In determining the highest and best use of the Claimants' Lands, the natural heritage
24. As of the Valuation Date, the potential for development of the Claimants' Lands for
urban uses was severely constrained by local, regional, and provincial legislation
designed to protect natural heritage features such as those found on the Claimants' Lands.
The Respondent denies that all of the various layers of environmental protection imposed
designation imposed using Provincial criteria formed part of the development in respect
of which the lands were expropriated, as alleged or implied in paragraphs 8, 17, 19 to 26,
25. The Respondent states that the highest and best use of the Claimants' Lands must be
determined by application of the PPS, the Precursor Policies and other applicable
legislation, including Municipal Planning Policies that implement the PPS with those
portions having protected natural heritage features remaining undeveloped and those
portions not subject to protection being for speculative future development, likely
26. The City's primary approach to implement the PPS was not through acquisition. The
City was a reluctant expropriator. In fact, these very expropriations were mandated by
the OMB at the specific request of the Claimants who wished to avoid the
27. The onus of proof on the impact of the imminence of the project or the expropriation on
value is on the party alleging it. As required by law, Windsor responded to the
requirements of the PPS and antecedence policies with local planning policies. It is not
policies would have been developed to protect Natural Features. Therefore, the Board
cannot conclude that all Spring Garden Area environmental policies are "scheme" related
28. To interpret and apply 14(4)(b) in this blanket and absolute manner that the Claimants
allege is to allow the Claimants a windfall for speculative buying in the face of a scheme.
This is not an interpretation that meets the objectives of the Expropriations Act and is not
conect.
8
29. The Respondent states that the following needs to be considered when determining the
c. The PPS, 1996 and Precursor Policies that provide that natural heritage features
endangered and threatened species (s. 2.3.l(a)). Further, it states that development
and site alteration will not be permitted in areas adjacent to lands containing
been demonstrated that there are no negative impacts on the natural features and
d. Municipal Planning Policies, other than acquisition policies, that implement the
PPS, the Precursor Policies and related Federal Policies that would have been in
e. To ignore the natural heritage features in assessing market value for compensation
purposes when the Claimants purchased many of the lots in question at value
31. The Respondent denies that any of the protected natural features, which had been
identified and delineated by provincial authorities long before the Respondent formed
altered" as a result of the City's acquisition related planning process as alleged by the
Claimants. The boundaries of the ANSI, established by MNR as early as the 1980's and
expanded in 1994, was virtually unchanged up to the Valuation Dates and included all of
32. The Respondent denies that there was "no Spring Garden Natural Area Complex" prior to
the introduction of Official Plan Amendment No. 5 ("OPA 5") by the City in December,
2001 and approved by the OMB in November, 2002, as alleged by the Claimants. This
allegation ignores the factual history of the natural features that existed in the ground, and
33. The Respondent denies that there was any "expectation that the Malden Planning Area
would have full urban development" prior to the implementation of OPA 5, as alleged by
the Claimants. This allegation contradicts the fact that the Claimants had been actively
10
purchasing lots within the area through the 1990's at rates that clearly reflected the purely
34. The Respondent specifically denies the Claimants' allegations that municipal services
would have been extended to the Expropriated Lands but for the expropriation. On the
contrary, the Expropriated Lands were acquired when no services were available for
development and, in fact, no steps were taken by the Claimants to extend services to the
limitations on development by the PPS would have restricted or eliminated the potential
for extending services to this area independent of, and notwithstanding, the expropriation.
35. The Respondent denies and puts the Claimants to strict proof of the allegations that
natural features "developed" or were "deliberately altered" by the Respondent, that "other
similarly situated lands" had been allowed to develop notwithstanding natural heritage
features, that "appropriate mitigation measures" would have permitted the development
of the Expropriated Lands, or that the Expropriated Lands would have served by a
highway, arterial road, and secondary system but for the expropriation. The Respondent
asserts that there were no plans to construct a highway or arterial roads in the area
surrounding the Expropriated Lands, and that the PPS would have limited or eliminated
the potential for developing the lands or extending the road system into the Spring
36. The Respondent pleads that the Claimants have been offered fair compensation for the
Expropriations Act. The Respondent further pleads that the market value of the
11
Expropriated Lands as of the Valuation Date is in accordance with the estimates of value
Injurious Affection
37. Subsection 14(4)(b) of the Expropriations Act is not applicable to injurious affection. In
accordance with the Court of Appeal's determination, any alleged diminution in value to
the remaining lands must be the result of the acquisition of the Expropriated Lands, not
38. The Respondent denies that the Claimants' remaining lands were injuriously affected by
the acquisitions described herein. The Expropriated Lands were subject to the PPS, the
designation imposed by the MNR to protect natural features that cannot be ignored in
assessing injurious affection. The acquisition of title to the Expropriated Lands by the
3 9. The Respondent denies that the acquisition of the Expropriated Lands negatively
impacted the value, development potential, timing or cost to develop the Claimants'
costs or inefficiencies in the development of the Claimants' remaining lands that did not
Disturbance Damages
40. The Respondent puts the Claimants to strict proof of any damages for delay or
Statement of Claim.
12
41. The Respondent states that the Claimants' entitlement to reasonable legal and appraisal
costs is subject to s. 32 of the Expropriations Act and the offers that the Respondent has
made.
42. If any interest is found to be owing to the Claimants, the amount of interest should be
reduced pursuant to section 33(2) of the Expropriations Act for the delay attributable to
This Reply is given by Borden Ladner Gervais LLP, Scotia Plaza, 40 King Street West, Toronto,
Ontario, M5H 3Y4, Lawyers for The Corporation of City of Windsor and the address to which
documents may be served is the same to the attention of Stephen F. Waque and Frank J.
Sperduti.
BETWEEN:
Claimants
- and
Respondent
of the Fresh As Amended Statement of Claim dated November 17, 2015 (the "Fresh as
Statement of Claim.
3. The Respondent expressly denies all other paragraphs in the Fresh as Amended Statement
TOROl: 6198603: v3
2
Background
4. The Claimants are the owners of lands in the City of Windsor in an area known as the
Malden Planning Area. The lands were subdivided in the 1920s and are held by the
the lands in question were never serviced or developed. As of the valuation date, these
84 year old lotting patterns no longer facilitated development and new plans of
5. As part of the Ojibway Prairie Remnant, this area is inhabited with a unique and diverse
biological community including 509 recorded plant species, 36 of which are considered
rare in Ontario.
6. Rare mammals such as the Gray Fox and Eastern Chipmunk inhabit the area. Reptiles
present include the Eastern Massassauga Rattlesnake and the Butler's Garter Snake,
which are threatened species and rare in Ontario. ·The complex also provides high quality
habitat for nesting raptors, fox, coyote, white-tailed deer and large reptiles such as eastern
7. As at the Valuation Date described herein, all of the lands expropriated, as well as some
of the remaining lands, qualified as an ANSI area using provincial criteria. Furthermore,
as of the Valuation Date:
a. Significant portions of the habitat for threatened and endangered fauna and flora
species were present on the expropriated lands and much of the remaining lands;
b. Significant habitat for endangered species and threatened species was present
throughout the expropriated lands and much of the remaining lands; and
3
significant wetland complex and their adjacent lands occurred throughout much of
8. As far back as 1983, these features were recognized by local and provincial authorities. In
1983, 115 acres were designated an Environmentally Significant Area by the Essex
Region Conservation Authority (the "ERCA"). In 1984, and in accordance with Province
Wide Standards, the Provincial Ministry of Natural Resources ("MNR") designated 248
9. In 1994, MNR expanded the boundary of the ANSI to encompass roughly 420 acres,
including all of the lands within the Provincial ANSI boundary that existed on the
10. The Claimants' Lands were, as of the Valuation Date defined herein, subject to other
Province wide legislation and regulations aimed at preserving natural heritage features.
These Provincial limitations on development included, but are not limited to, the
Provincial Policy Statement issued in March, 2005 (the "2005 PPS") and its predecessor
policy statements including the PPS issued in May, 1996 (the "1996 PPS"). The
Respondent pleads and relies on these Provincial Policy Statements, which created stand
11. The 2005 PPS and the earlier 1996 PPS were anticipated by earlier Provincial Policy.
abundance on the Claimants' Lands - was prohibited.. The Respondent pleads and relies
4
on the Provincial Wetlands Policy Statement, issued under the authority of Section 3 of
the Planning Act, on May 14, 1992, and on the Comprehensive Set of Policy Statements
("CSPS"), issued by the Province on March 28, 1995. These and other Provincial
Guidelines and Policy Statements that pre-date 2005 PPS are hereinafter described as
Precursor Policies.
12. As part of a mandatory 5 year review, and following public consultation which began in
May of 2002, the provincial government posted PPS draft policies on the Environmental
Bill of Rights Registry from June 3, 2004 until i\ugust 31, 2004. In February of 2005, the
PPS, 2005 was released and came into effect on March 1, 2005, further reinforcing the
13. On November 30, 2004, the Strong Communities (Planning Amendment) Act, 2004 (Bill
26) received royal assent which provided that planning decisions shall be consistent with
the PPS.
14. The Claimants' Lands were, as of the Valuation Date defined herein, also subject to
federal legislation. The Respondent pleads and relies on, inter alia, the Species at Risk
Act, S.C. 2002, c. 29, which was enacted to prevent wildlife species from becoming
extirpated or extinct, and which received royal assent on December 12, 2002. The
Respondent also pleads and relies on the Migratory Birds Convention Act, 1994, S.C.
1994, c. 22, which also applied to the Claimants' Lands and would have prevented or
The Expropriation
15. The Respondent registered Plans of Expropriation Nos. CE191183 and CE191184 on
16. The purpose of the expropriation was to preserve a natural area and critical habitat for
endangered and threatened species known as the Spring Garden Area of Natural and
17. The Plan of Expropriation required the expropriation of the following lands from the
a. The lands owned by the Claimant, Paciorka Leaseholds Limited, described as Part
b. The lands owned by the Claimant, Bruce Paciorka, described as Parts 3, 4, and 42
c. The lands owned by the Claimant, Gordon Paciorka described as Parts 13 and 18
The Prior Decisions of the Board and the Court of Appeal and the Requirement to Account
for the Impact on Value of the PPS
18. On December 2, 2009, the Ontario Municipal Board (the "OMB" or the "Board") issued
a decision wherein the Board awarded the Claimants compensation for the market value
of the Expropriated Lands, injurious affection to the lands remaining in the Claimants'
6
ownership, disturbance damages to Bruce Paciorka and an award of interest on the unpaid
19. The Respondent appealed the OMB Decision to the Divisional Court. On May 16, 2011,
the Divisional Court (Herman, Havison Young JJ., Sachs J. dissenting) dismissed the
20. On October 31, 2011, the Respondent sought and was granted leave to appeal the
21. The primary issues before the Ontario Court of Appeal were whether the Board had
properly considered the PPS in reaching its determination of market value and whether
the Board misapplied s.14(4)(b) in reaching its conclusion that the lands remaining in the
22. The Court of Appeal concluded that the Board erred on both counts. It held that the PPS
was not part of the expropriation scheme and ought not to be ignored pursuant to subs.
23. The Court of Appeal further held that the Board erred in awarding damages for injurious
affection by measuring the impact on the value of the remaining lands caused by the
expropriation scheme rather than assessing the impact, if any, on the value of the
24. As a result, the Court of Appeal set aside the order of the Divisional Court and the order
of the Board and directed a new hearing before a differently constituted panel of the
Board.
Valuation Date
25. The Respondent states that the date for determination of compensation is December 28,
2005 (the "Valuation Date"), the date the Respondent registered the plans of
expropriation.
26. In determining the highest and best use of the Claimants' Lands, the natural heritage
27. As of the Valuation Date, the potential for development of the Claimants' Lands for
urban uses was severely constrained by local, regional, and provincial legislation
designed to protect natural heritage features such as those found on the Claimants' Lands.
The Respondent denies that all of the various layers of environmental protection imposed
designation imposed using Provincial criteria formed part of the development in respect
28. The Respondent states that the highest and best use of the Claimants' Lands must be
determined by application of the 2005 PPS, the Precursor Policies and other applicable
8
legislation, including Municipal Planning Policies that implement the PPS, with those
portions having protected natural heritage features remaining undeveloped and those
portions not subject to protection being for speculative future development, likely
29. The City's primary approach to implement the PPS was not through acquisition. The
City was a reluctant expropriator. In fact, these very expropriations were mandated by
the OMB at the specific request of the Claimants who wished to avoid the
30. The onus of proof on the impact of the imminence of the project or the expropriation on
value is on the party alleging it. As required by law, Windsor responded to the
requirements of the PPS and antecedence policies with local planning policies. It is not
policies would have been developed to protect Natural Features. Therefore, the Board
cannot conclude that all Spring Garden Area environmental policies are "scheme" related
31. To interpret and apply 14(4)(b) in this blanket and absolute manner that the Claimants
allege is to allow the Claimants a windfall for speculative buying in the face of a scheme.
This is not an interpretation that meets the objectives of the Expropriations Act and is not
correct.
32. The Respondent states that the purchase prices paid by the Claimants for the lands in
question reflect the limited development potential resulting from the existing natural
9
heritage features. In fact, the Claimants purchased many of the lots in question after and
during the time when the natural features had already been identified by public
authorities.
33. The Respondent states that the following must be considered when determining the
c. The 2005 PPS and Precursor Policies that provide that natural heritage features
2005 PPS states that development will not be permitted in significant portions of
the habitat of endangered and threatened species (s. 2.3.l(a)). Further, the 2005
unless it has been demonstrated that there are no negative impacts on the natural
features and ecological functions of the area. In ·accordance with the Court of
the limitation on value imposed by the 2005 PPS and the Precursor Policies;
10
d. Municipal Planning Policies, other than acquisition policies, that implement the
2005 PPS, the Precursor Policies and related Federal Policies that would have
e. The 2005 PPS requirement to maintain, restore, and where possible improve
linkages between and among natural features and areas, surface water features and
f. The Endangered Species Act, 2007 and the Species at Risk Act limitation on the
habitats. The Expropriated Lands contain flora and fauna species and habitat that
are expressly protected by the Endangered Species Act, 2007 and migratory birds
g. To ignore the natural heritage features in assessing market value for compensation
purposes when the Claimants purchased many of the lots in question at value
35. The Respondent denies that any of the protected natural features, which had been
identified and delineated by provincial authorities long before the Respondent formed
altered" as a result of the City's acquisition related planning process as alleged by the
Claimants. The boundaries of the ANSI, established by MNR as early as the 1980's and
expanded in 1994, was virtually unchanged up to the Valuation Dates and included all of
36. The Respondent denies that there was "no Spring Garden Natural Area Complex" prior to
the introduction of Official Plan Amendment No. 5 ("OPA 5") by the City in December,
2001 and approved by the OMB in November, 2002, as alleged by the Claimants. This
allegation ignores the factual history of the natural features that existed in the ground, and
37. The Respondent denies that there was any "expectation that the Malden Planning Area
would have· full urban development" prior to the implementation of OPA 5, as alleged by
the Claimants. This allegation contradicts the fact that the Claimants had been actively
purchasing lots within the area through the 1990's at rates that clearly reflected the purely
38. The Respondent specifically denies the Claimants' allegations that municipal services
would have been extended to the Expropriated Lands but for the expropriation. On the
contrary, the Expropriated Lands were acquired when no services were available for
development and, in fact, no steps were taken by the Claimants to extend services to the
limitations on development by the 2005 PPS and the Precursor Policies, among other
limitations, would have restricted or eliminated the potential for extending services to this
39. The Respondent denies and puts the Claimants to strict proof of the allegations that
natural features "developed" or were "deliberately altered" by the Respondent, that "other
similarly situated lands" had been allowed to develop notwithstanding natural heritage
features, that "appropriate mitigation measures" would have permitted the development
of the Expropriated Lands, or that the Expropriated Lands would have served by a
highway, arterial road, and secondary system but for the expropriation. The Respondent
asserts that there were no plans to construct a highway or arterial roads in the area
surrounding the Expropriated Lands, and that the PPS would have limited or eliminated
the potential for developing the lands or extending the road system into the Spring
40. The Respondent pleads that the Claimants have been offered fair compensation for the
Expropriations Act. The Respondent further pleads that the market value of the
Expropriated Lands as of the Valuation Date is in accordance with the estimates of value
Injurious Affection
41. .Subsection 14(4)(b) of the Expropriations Act is not applicable to injurious affection. In
accordance with the Court of Appeal's determination, any alleged diminution in value to
13
the remaining lands must be the result of the acquisition of the Expropriated Lands, not
42. The Respondent denies that the Claimants' remaining lands were injuriously affected by
the acquisitions described herein. The Expropriated Lands were subject to the 2005 PPS,
the Precursor Policies and other legislation, the Environmentally Significant Area
designation imposed by the ERCA, and ANSI designation imposed by the MNR to
protect natural features that cannot be ignored in assessing injurious affection. The
acquisition of title to the Expropriated Lands by the Respondent did not change these
facts.
43. The Respondent denies that the acquisition of the Expropriated Lands negatively
impacted the value, development potential, timing or cost to develop the Claimants'
costs or inefficiencies in the development of the Claimants' remaining lands that did not
Disturbance Damages
44. The Respondent puts the Claimants to strict proof of any damages for delay or
Statement of Claim, and denies that any interest is payable as stated in paragraph 49 and
50.
45. If any interest is found to be owing to the Claimants, the amount of interest should be
reduced pursuant to section 33(2) of the Expropriations Act for the delay attributable to
Costs
46. The Respondent states that the Claimants' entitlement to reasonable legal and appraisal
costs is subject to s. 32 of the Expropriations Act and the offers that the Respondent has
made.
47. The Respondent states that the Claimants were properly served with a Section 25 Offer
upon their legal counsel at that time, which was acknowledged by the Claimants. The
This Reply is given by Borden Ladner Gervais LLP, Scotia Plaza, 40 King Street West, Toronto,
Ontario, M5H 3Y4, Lawyers for The Corporation of City of Windsor and the address to which
documents may be served is the same to the attention of Stephen F. Waque and Frank J.
Sperduti.
IN THE MATTER OF the Expropriations Act, R.S.O. 1990, c.E. 26, and
IN THE MATTER OF an arbitration
BETWEEN:
ELIZABETH FREY
Claimant
-and-
the Fresh as Amended Statement of Claim received on June 24, 2016 (the "Fresh as
Claim.
3. The Respondent expressly denies all other paragraphs in the Fresh as Amended Statement
Background
4. The Claimant is the owner of lands in the City of Windsor in an area known as the
Malden Planning Area. The lands were subdivided in the 1920s and are held by the
the lands in question were never serviced or developed. As of the valuation date, these
84 year old lotting patterns no longer facilitated development and new plans of
5. As part of the Ojibway Prairie Remnant, this area is inhabited with a unique and diverse
biological community including 509 recorded plant species, 36 of which are considered
rare in Ontario.
6. Rare mammals such as the Gray Fox and Eastern Chipmunk inhabit the area. Reptiles
present include the Eastern Massassauga Rattlesnake and the Butler's Garter Snake,
which are threatened species and rare in Ontario. The complex also provides high quality
habitat for nesting raptors, fox, coyote, white-tailed deer and large reptiles such as eastern
7. As at the Valuation Date described herein, all of the lands expropriated, as well as some
of the remaining lands, qualified as an ANSI area using provincial criteria. Furthermore,
(a) Significant portions of the habitat for threatened and endangered fauna and flora species
were present on the expropriated lands and much of the remaining lands;
(b) Significant habitat for endangered species and threatened species was present throughout
(c) Wetlands within the Ojibway Prairie Provincially Significant Wetland Complex
significant wetland complex and their adjacent lands occurred throughout much of the
8. As far back as 1983, these features were recognized by local and provincial authorities.
In 1983, 115 acres were designated an Environmentally Significant Area by the Essex
Region Conservation Authority (the "ERCA"). In 1984, and in accordance with Province
Wide Standards, the Provincial Ministry of Natural Resources ("MNR") designated 248
9. In 1994, MNR expanded the boundary of the ANSI to encompass roughly 420 acres,
including all of the lands within the Provincial ANSI boundary that existed on the
10. The Claimant's Lands were, as of the Valuation Date defined herein, subject to other
Province wide legislation aimed at preserving natural heritage features. The Respondent
pleads and relies on the Provincial Policy Statement issued on May 22, 1996, and
amended February 1, 1997 (the "PPS"), which created a stand-alone, Province wide
Claimant's Lands.
11. The introduction of the PPS was anticipated by earlier Provincial Policy. For example,
Claimant's Lands - was prohibited. The Respondent pleads and relies on the Provincial
Wetlands Policy Statement, issued under the authority of Section 3 of the Planning Act,
on May 14, 1992, and on the Comprehensive Set of Policy Statements ("CSPS"), issued
4
by the Province on March 28, 1995. These and other Provincial Guidelines and Policy
Statements that pre-date May 22, 1996 are hereinafter described as Precursor Policies.
12. On November 30, 2004, the Strong Communities (Planning Amendment) Act, 2004 (Bill
26) received royal assent which provided that planning decisions shall be consistent with
the PPS.
13. The Claimant's Lands were, as of the Valuation Date defined herein, also subject to
federal legislation. The Respondent pleads and relies on, inter alia, the Species at Risk
Act, S.C. 2002, c. 29, which was enacted to prevent wildlife species from becoming
extirpated or extinct, and which received royal assent on December 12, 2002. The
Respondent also pleads and relies on the Migratory Birds Convention Act, 1994, S.C.
1994, c. 22, which also applied to the Claimant's Lands and would have prevented or
The Expropriation
14. The Respondent registered Plan of Expropriation No. Rl541750 on April 7, 2004.
15. The purpose of the expropriation was to preserve a natural area and critical habitat for
endangered and threatened species known as the Spring Garden Area of Natural and
16. The Plan of Expropriation required the expropriation of Parts 46, 49, and 50 on the Plan
The Prior Decisions of the Board and the Court of Appeal and the Requirement to Account
for the Impact on Value of the PPS
17. On December 2, 2009, the Ontario Municipal Board (the "OMB" or the "Board") issued
a decision wherein the Board awarded the Claimant compensation for the market value of
the Expropriated Lands, injurious affection to the lands remaining in the Claimant's
ownership, and an award of interest on the unpaid compensation (the "OMB Decision").
18. The Respondent appealed the OMB Decision to the Divisional Court. On May 16, 2011,
the Divisional Court (Herman, Havison Young JJ., Sachs J. dissenting) dismissed the
19. On October 31, 2011, the Respondent sought and was granted leave to appeal the
20. The primary issues before the Ontario Court of Appeal were whether the Board had
properly considered the PPS in reaching its determination of market value and whether
the Board misapplied s.14(4)(b) in reaching its conclusion that the lands remaining in the
21. The Court of Appeal concluded that the Board erred on both counts. It held that the PPS
was not part of the expropriation scheme and ought not to be ignored pursuant to subs.
22. The Court of Appeal further held that the Board erred in awarding damages for injurious
affection by measuring the impact on the value of the remaining lands caused by the
6
expropriation scheme rather than assessmg the impact, if any, on the value of the
23. As a result, the Court of Appeal set aside the order of the Divisional Court and the order
of the Board and directed a new hearing before a differently constituted panel of the
Board.
Valuation Date
24. The Respondent states that the date for determination of compensation is April 7, 2004
(the "Valuation Date"), the date the Respondent registered the plan of expropriation.
25. In determining the highest and best use of the Claimant's Lands, the natural heritage
26. As of the Valuation Date, the potential for development of the Claimant's Lands for
urban uses was severely constrained by local, regional, and provincial legislation
designed to protect natural heritage features such as those found on the Claimant's Lands.
The Respondent denies that all of the various layers of environmental protection imposed
Provincial criteria and levels of government formed part of the development in respect of
which the lands were expropriated, as alleged or implied in paragraphs 6, 13, 15, 16, 17
27. The Respondent states that the highest and best use of the Claimant's Lands must be
determined by application of the PPS, the Precursor Policies and other applicable
legislation, including Municipal Planning Policies that implement the PPS with those
portions having protected natural heritage features remaining undeveloped and those
portions not subject to protection being for speculative future development, likely
28. The City's primary approach to implement the PPS was not through acquisition. The
City was a reluctant expropriator. In fact, these very expropriations were mandated by
the OMB at the specific request of the Claimant who wished to avoid the implementation
of Provincial Policy.
29. The onus of proof on the impact of the imminence of the project or the expropriation on
value is on the party alleging it. As required by law, Windsor responded to the
requirements of the PPS and antecedence policies with local planning policies. It is not
policies would have been developed to protect Natural Features. Therefore, the Board
cannot conclude that all Spring Garden Area environmental policies are "scheme" related
30. To interpret and apply 14(4)(b) in this blanket and absolute manner that the Claimant
alleges is to allow the Claimant a windfall for speculative buying in the face of a scheme.
This is not an interpretation that meets the objectives of the Expropriations Act and is not
correct.
8
31. The Respondent states that the following needs to be considered when determining the
(a) The physical features on the Expropriated Lands, as detailed above, were naturally
(b) As of the Valuation Date, the Claimant's Lands were subject to the Environmentally
Significant Area designation imposed by the ERCA, and ANSI designation imposed by
(c) The PPS, 1996, and Precursor Policies that provide that natural heritage features and
development will not be permitted in significant portions of the habitat of endangered and
threatened species (s. 2.3.l(a)). Futiher, it states that development and site alteration will
endangered and threatened species, unless it has been demonstrated that there are no
negative impacts on the natural features and ecological functions of the area. In
market value cannot ignore the limitation on value imposed by the PPS;
(d) Municipal Planning Policies, other than acquisition policies, that implement the PPS, the
Precursor Policies and related Federal Policies that would have been in place irrespective
(e) To ignore the natural heritage features in assessing market value for compensation
purposes when the Claimant purchased many of the lots in question at value reflecting
those features will result in an unacceptable and unintended windfall gain to the Claimant
33. The Respondent denies that any of the protected natural features, which had been
identified and delineated by provincial authorities long before the Respondent formed
altered" as a result of the City's acquisition related planning process as alleged by the
Claimant. The boundaries of the ANSI, established by MNR as early as the 1980's and
expanded in 1994, was virtually unchanged up to the Valuation Dates and included all of
34. The Respondent denies that there was "no Spring Garden Natural Area Complex" prior to
the introduction of Official Plan Amendment No. 5 ("OPA 5") by the City in December,
2001 and approved by the OMB in November, 2002, as alleged by the Claimant. This
allegation ignores the factual history of the natural features that existed in the ground, and
35. The Respondent denies that there was any "expectation that the Malden Planning Area
would have full urban development" prior to the implementation of OPA 5, as alleged by
the Claimant.
36. The Respondent specifically denies the Claimant's allegations that municipal services
would have been extended to the Expropriated Lands but for the expropriation. On the
contrary, the Expropriated Lands were acquired when no services were available for
development and, in fact, no steps were taken by the Claimant to extend services to the
10
limitations on development by the PPS would have restricted or eliminated the potential
for extending services to this area independent of, and notwithstanding, the expropriation.
3 7. The Respondent denies and puts the Claimant to strict proof of the allegations that natural
similarly situated lands" had been allowed to develop notwithstanding natural heritage
features, that "appropriate mitigation measures" would have permitted the development
of the Expropriated Lands, or that the Expropriated Lands would have served by a
highway, arterial road, and secondary system but for the expropriation. The Respondent
asserts that there were no plans to construct a highway or arterial roads in the area
surrounding the Expropriated Lands, and that the PPS would have limited or eliminated
the potential for developing the lands or extending the road system into the Spring
3 8. The Respondent states that paragraphs 16 and 19 of the Fresh as Amended Statement of
Claim are not properly before the Board, do not relate to the availability of services or
3 9. The Respondent pleads that the Claimant has been offered fair compensation for the
Expropriations Act. The Respondent further pleads that the market value of the
Expropriated Lands as of the Valuation Date is in accordance with the estimates of value
Injurious Affection
40. Subsection 14(4)(b) of the Expropriations Act is not applicable to injurious affection. In
accordance with the Court of Appeal's determination, any alleged diminution in value to
the remaining lands must be the result of the acquisition of the Expropriated Lands, not
41. The Respondent denies that the Claimant's remaining lands were injuriously affected by
the acquisitions described herein. The Expropriated Lands were subject to the PPS, the
designation imposed by the MNR to protect natural features that cannot be ignored in
assessing injurious affection. The acquisition of title to the Expropriated Lands by the
42. The Respondent denies that the acquisition of the Expropriated Lands negatively
impacted the value, development potential, timing or cost to develop the Claimant's
costs or inefficiencies in the development of the Claimant's remaining lands that did not
Disturbance Damages
43. The Respondent puts the Claimant to the full proof of any damages for delay or
Statement of Claim.
12
44. The Respondent states that the Claimant's entitlement to reasonable legal and appraisal
costs is subject to Section 32 of the Expropriations Act and the offers that the Respondent
has made.
45. The Respondent admits that the Claimant was not served a Section 25 offer until July 26,
2006. The Respondent states that subs. 25(4) and Section 33 of the Expropriations Act
expropriation plan, interest shall be paid at a standard rate of 6 per cent a year from the
date of the expropriation plan. The Respondent denies that any additional interest is
owed to the Claimant for the time between April 7, 2004 and July 26, 2006.
This Reply is given by Borden Ladner Gervais LLP, Scotia Plaza, 40 King Street West, Toronto,
Ontario, M5H 3Y4 (Address effective October 17, 2016: Bay Adelaide Centre, East Tower, 22
Adelaide Street West, Toronto, Ontario, M5H 4E3), Lawyers for The Corporation of City of
Windsor and the address to which documents may be served is the same to the attention of
TOROI: 6412118: v3
O.M.B. Case No. LC080005
O.M.B. FileNo. LC080005
BETWEEN:
-and-
of the Fresh as Amended Statement of Claim November 17, 2015 (the "Fresh as
Claim.
3. The Respondent expressly denies all other paragraphs in the Fresh as Amended Statement
Background
4. The Claimants are the owners of lands in the City of Windsor in an area known as the
Malden Planning Area. The lands were subdivided in the 1920s and are held by the
the lands in question were never serviced or developed. As of the valuation date, these
84 year old lotting patterns no longer facilitated development and new plans of
5. As part of the Ojibway Prairie Remnant, this area is inhabited with a unique and diverse
biological community including 509 recorded plant species, 36 of which are considered
rare in Ontario.
6. Rare mammals such as the Gray Fox and Eastern Chipmunk inhabit the area. Reptiles
present include the Eastern Massassauga Rattlesnake and the Butler's Garter Snake,
which are threatened species and rare in Ontario. The complex also provides high quality
habitat for nesting raptors, fox, coyote, white-tailed deer and large reptiles such as eastern
7. As at the Valuation Date described herein, all of the lands expropriated, as well as some
of the remaining lands, qualified as an ANSI area using provincial criteria. Furthermore,
as of the Valuation Date:
a. Significant portions of the habitat for threatened and endangered fauna and flora
species were present on the expropriated lands and much of the remaining lands;
b. Significant habitat for endangered species and threatened species was present
throughout the expropriated lands and much of the remaining lands; and
3
significant wetland complex and their adjacent lands occurred throughout much of
8. As far back as 1983, these features were recognized by local and provincial authorities.
In 1983, 115 acres were designated an Environmentally Significant Area by the Essex
Region Conservation Authority (the "ERCA"). In 1984, and in accordance with Province
Wide Standards, the Provincial Ministry of Natural Resources ("MNR") designated 248
9. In 1994, MNR expanded the boundary of the ANSI to encompass roughly 420 acres,
including all of the lands within the Provincial ANSI boundary that existed on the
10. The Claimants' Lands were, as of the Valuation Date defined herein, subject to other
Province wide legislation and regulations aimed at preserving natural heritage features.
These Provincial limitations on development included, but are not limited to, the
Provincial Policy Statement issued in March, 2005 (the "2005 PPS") and its predecessor
policy statements including the PPS issued in May, 1996 (the "1996 PPS"). The
Respondent pleads and relies on these Provincial Policy Statements, which created stand
11. The 2005 PPS and the earlier 1996 PPS were anticipated by earlier Provincial Policy.
abundance on the Claimants' Lands - was prohibited. The Respondent pleads and relies
4
on the Provincial Wetlands Policy Statement, issued under the authority of Section 3 of
the Planning Act, on May 14, 1992, and on the Comprehensive Set of Policy Statements
("CSPS"), issued by the Province on March 28, 1995. These and other Provincial
Guidelines and Policy Statements that pre-date 2005 PPS are hereinafter described as
Precursor Policies.
12. As part of a mandatory 5 year review, and following public consultation which began in
May of 2002, the provincial government posted PPS draft policies on the Environmental
Bill of Rights Registry from June 3, 2004 until August 31, 2004. In February of 2005, the
PPS, 2005 was released and came into effect on March 1, 2005, further reinforcing the
13. On November 30, 2004, the Strong Communities (Planning Amendment) Act, 2004 (Bill
26) received royal assent which provided that planning decisions shall be consistent with
the PPS.
14. In 2007, the Endangered Species Act, 2007, S.O. 2007, c. 6 was passed with the express
goal of protecting species that are at risk and their habitats. The Respondent pleads and
15. The Claimants' Lands were, as of the Valuation Date defined herein, also subject to
federal legislation. The Respondent pleads and relies on, inter alia, the Species at Risk
Act, S.C. 2002, c. 29, which was enacted to prevent wildlife species from becoming
extirpated or extinct, and which received royal assent on December 12, 2002. The
Respondent also pleads and relies on the Migratory Birds Convention Act, 1994, S.C.
5
1994, c. 22, which also applied to the Claimants' Lands and would have prevented or
The Expropriation
16. On January 29, 2008, the Respondent expropriated various lots owned by the Claimants
17. The purpose of the expropriation was to preserve a natural area and critical habitat for
endangered and threatened species within an area known as the Spring Garden Complex
18. The Plan of Expropriation resulted in the taking of the following lands from the
a. The lands owned by the Claimant, Bruce Paciorka, described as Part 69 on the
Plan of Expropriation. The lands were purchased in 1988 for $700.00 per lot;
b. The lands jointly owned by the Claimants, Bruce Paciorka and Gordon Paciorka,
described as Parts 55 and 70 on the Plan of Expropriation. The lands were
purchased in 1986 for $550.00 per lot; and
The Prior Decisions of the Board and the Court of Appeal and the Requirement to Account
for the Impact on Value of the PPS
19. On December 2, 2009, the Ontario Municipal Board (the "OMB" or the "Board") issued
a decision wherein the Board awarded the Claimants compensation for the market value
of the Expropriated Lands, injurious affection to the lands remaining in the Claimants'
6
ownership, disturbance damages to Bruce Paciorka and an award of interest on the unpaid
20. The Respondent appealed the OMB Decision to the Divisional Court. On May 16, 2011,
the Divisional Court (Herman, Havison Young JJ., Sachs J. dissenting) dismissed the
21. On October 31, 2011, the Respondent sought and was granted leave to appeal the
22. The primary issues before the Ontario Court of Appeal were whether the Board had
properly considered the PPS in reaching its determination of market value and whether
the Board misapplied s.14(4)(b) in reaching its conclusion that the lands remaining in the
23. The Court of Appeal concluded that the Board erred on both counts. It held that the PPS
was not part of the expropriation scheme and ought not to be ignored pursuant to subs.
24. The Court of Appeal further held that the Board .erred in awarding damages for injurious
affection by measuring the impact on the value of the remaining lands caused by the
expropriation scheme rather than assessing the impact, if any, on the value of the
25. As a result, the Court of Appeal set aside the order of the Divisional Court and the order
of the Board and directed a new hearing before a differently constituted panel of the
Board.
Valuation Date
26. The Respondent states that the date for determination of compensation is January 29,
2008 (the "Valuation Date"), the date the Respondent registered the plan of
expropriation.
27. In determining the highest and best use of the Claimants' Lands, the natural heritage
28. As of the Valuation Date, the potential for development of the Claimants' Lands for
urban uses was severely constrained by local, regional, and provincial legislation
designed to protect natural heritage features such as those found on the Claimants' Lands.
The Respondent denies that all of the various layers of environmental protection imposed
designation imposed using Provincial criteria formed part of the development in respect
29. The Respondent states that the highest and best use of the Claimants' Lands must be
determined by application of the PPS, the Precursors to the PPS and other applicable
legislation, including Municipal Planning Policies that implement the PPS with those
portions having protected natural heritage features remaining undeveloped and those
portions not subject to protection being for speculative future development, likely
3 0. The City's primary approach to implement the PPS was not through acquisition. The
City was a reluctant expropriator. In fact, these very expropriations were mandated by
the OMB at the specific request of the Claimants who wished to avoid the
31. The onus of proof on the impact of the imminence of the project or the expropriation on
value is on the party alleging it. As required by law, Windsor responded to the
requirements of the PPS and antecedence policies with local planning policies. It is not
policies would have been developed to protect Natural Features. Therefore, the Board
cannot conclude that all Spring Garden Area environmental policies are "scheme" related
32. To interpret and apply 14(4)(b) in this blanket and absolute manner that the Claimants
allege is to allow the Claimants a windfall for speculative buying in the face of a scheme.
This is not an interpretation that meets the objectives of the Expropriations Act and is not
correct.
9
33. The Respondent states that the purchase prices paid by the Claimants for the lands in
question reflect the limited development potential resulting from the existing natural
heritage features. In fact, the Claimants purchased many of the lots in question after and
during the time when the natural features had already been identified by public
authorities.
34. The Respondent states that the following must be considered when determining the
c. The 2005 PPS and Precursor Policies that provide that natural heritage features
and areas will be protected from incompatible development. In particular, the
2005 PPS states that development will not be permitted in significant portions of
the habitat of endangered and threatened species (s. 2.3. l(a)). Further, the 2005
PPS prohibits that development and site alteration in areas adjacent to lands
containing significant portions of habitat of endangered and threatened species,
unless it has been demonstrated that there are no negative impacts on the natural
features and ecological functions of the area. In accordance with the Court of
Appeal's determination, the Board's determination of market value cannot ignore
the limitation on value imposed by the 2005 PPS and the Precursor Policies;
d. Municipal Planning Policies, other than acquisition policies, that implement the
2005 PPS, the Precursor Policies and related Federal Policies that would have
been in place irrespective of any acquisition scheme;
10
e. The 2005 PPS requirement to maintain, restore, and where possible improve
linkages between and among natural features and areas, surface water features and
ground water features;
f. The Endangered Species Act, 2007 and the Species at Risk Act limitation on the
development potential of the Claimants' Lands through prohibiting the killing,
harming, harassing, and capturing of endangered and threatened species and
prohibition on damage and destruction to endangered or threatened species'
habitats. The Expropriated Lands contain flora and fauna species and habitat that
are expressly protected by the Endangered Species Act, 2007 and migratory birds
that are protected by the Species at Risk Act; and
g. To ignore the natural heritage features in assessing market value for compensation
purposes when the Claimants purchased many of the lots in question at value
reflecting those features will result in an unacceptable and unintended windfall
gain to the Claimants simply because the lands were expropriated.
36. The Respondent denies that any of the protected natural features, which had been
identified and delineated by provincial authorities long before the Respondent formed
altered" as a result of the City's acquisition related planning process as alleged by the
Claimants. The boundaries of the ANSI, established by MNR as early as the 1980's and
expanded in 1994, was virtually unchanged up to the Valuation Dates and included all of
37. The Respondent denies that there was "no Spring Garden Natural Area Complex" prior to
the introduction of Official Plan Amendment No. 5 ("OPA 5") by the City in December,
2001 and approved by the OMB in November, 2002, as alleged by the Claimants. This
allegation ignores the factual history of the natural features that existed in the ground, and
38. The Respondent denies that there was any "expectation that the Malden Planning Area
would have full urban development" prior to the implementation of OPA 5, as alleged by
the Claimants. This allegation contradicts the fact that the Claimants had been actively
purchasing lots within the area through the 1990' s at rates that clearly reflected the purely
3 9. The Respondent specifically denies the Claimants' allegations that municipal services
would have been extended to the Expropriated Lands but for the expropriation. On the
contrary, the Expropriated Lands were acquired when no services were available for
development and, in fact, no steps were taken by the Claimants to extend services to the
limitations on development by the 2005 PPS and the Precursor Policies, among other
limitations, would have restricted or eliminated the potential for extending services to this
40. The Respondent denies and puts the Claimants to strict proof of the allegations that
natural features "developed" or were "deliberately altered" by the Respondent, that "other
similarly situated lands" had been allowed to develop notwithstanding natural heritage
features, that "appropriate mitigation measures" would have permitted the development
12
of the Expropriated Lands, or that the Expropriated Lands would have served by a
highway, arterial road, and secondary system but for the expropriation. The Respondent
asserts that there were no plans to construct a highway or arterial roads in the area
smrounding the Expropriated Lands, and that the PPS would have limited or eliminated
the potential for developing the lands or extending the road system into the Spring
41. The Respondent pleads that the Claimants have been offered fair compensation for the
Expropriations Act. The Respondent further pleads that the market value of the
Expropriated Lands as of the Valuation Date is in accordance with the estimates of value
Injurious Affection
42. Subsection 14(4)(b) of the Expropriations Act is not applicable to injurious affection. In
accordance with the Court of Appeal's determination, any alleged diminution in value to
the remaining lands must be the result of the acquisition of the Expropriated Lands, not
43. The Respondent denies that the Claimants' remaining lands were injuriously affected by
the acquisitions described herein. The Expropriated Lands were subject to the 2005 PPS,
the Precursor Policies and other legislation, the Environmentally Significant Area
designation imposed by the ERCA, and ANSI designation imposed by the MNR to
addition, the Expropriated Lands contain flora and fauna species and habitat that are
13
expressly protected by the Endangered Species Act, 1997. The acquisition of title to the
44. The Respondent denies that the acquisition of the Expropriated Lands negatively
impacted the value, development potential, timing or cost to develop the Claimants'
costs or inefficiencies in the development of the Claimants' remaining lands that did not
45. The Respondent puts the Claimants to the full proof of any damages for delay or
Statement of Claim.
Costs
46. The Respondent states that the Claimants' entitlement to reasonable legal and appraisal
costs is subject to s. 32 of the Expropriations Act and the offers that the Respondent has
made.
This Reply is given by Borden Ladner Gervais LLP, Scotia Plaza, 40 King Street West, Toronto,
Ontario, MSH 3Y4, Lawyers for The Corporation of City of Windsor and the address to which
documents may be served is the same to the attention of Stephen F. Waque and Frank J.
Sperduti.