



COURT OF APPEAL FOR ONTARIO

CITATION: Muskoka Lakes (Township) v. Ontario (Natural
Resources), 2014 ONCA 557

DATE: 20140721

DOCKET: C58655

Hoy A.C.J.O., Gillese and Lauwers JJ.A.

BETWEEN

The Corporation of the
Township of Muskoka Lakes

Appellant

and

Her Majesty the Queen
in Right of Ontario as Represented by the Minister of Natural Resources and
Swift River Energy Limited

Respondents



Harold G. Elston and Aynsley L. Anderson, for the appellant

Ronald Carr and Sandra Nishikawa, for the respondent Her
Majesty the Queen in Right of Ontario

Neil Finkelstein, Eric S. Block and Shane C. DSouza,
for the respondent Swift River Energy Limited

Heard:  July 14, 2014

On appeal from the order of Justices Nordheimer, Aston and
Perell of the Divisional Court, dated August 19, 2013, with reasons reported at
2013 ONSC 5380.

ENDORSEMENT



[1]

The Township appeals the order of the Divisional
Court dismissing its application for judicial review of the decision of the
Minister of Natural Resources (the Minister) to prohibit access to certain
Crown lands adjacent to Bala Falls (the Site) under s. 28(1) of the
Public
Lands Act
, R.S.O. 1990, c. P. 43 (the Act), and for
orders (the Ancillary Orders): (1) declaring that a portage protected by s.
65(4) of the Act passes over the Site; (2) prohibiting the Minister or any
other person from interfering with that portage; (3) setting aside the water
frontage at the Site for recreational and access purposes pursuant to s. 3 of
the Act; (4) prohibiting any interference with that frontage; and (5) enjoining
the Minister from issuing a lease and agreement for the construction and
occupation of a waterpower generation facility on the Site.

[2]

Section 28(1) of the Act permits the Minister to
prohibit the possession, occupation or use of public lands. The Divisional
Court found that the Ministers decision to restrict public access to the Site
was reasonable. It wrote:


The Ministry made that determination because
of expressed concerns about public safety and after commissioning a Public
Safety Measures Plan. These safety concerns have existed at least since 2009
when there was a double drowning in the waters off of these lands.



[A] complete ban on public access to the Crown
lands, in circumstances where two people have already lost their lives, cannot
be shown to be so manifestly unreasonable as to justify interference by this
court.

[3]

It was not satisfied that the Ministers
decision under s. 28 was a guise to ensure that a new waterpower generation
facility could be constructed on the Site.

[4]

The Divisional Court also rejected the
Townships argument that the Minister could not invoke s. 28(1) if s. 3 or s.
65(4) of the Act applies. Section 3 requires the Minister to set aside a
certain percentage of public lands fronting on a body of water for
recreational and access purposes. Section 65(4) provides a right to pass over
a portage [w]here public lands over which a portage has existed or exists have
been heretofore or are hereafter sold or otherwise disposed of under this or
any other Act. The Divisional Court found that s. 28 was not made subject to
any other provision in the Act, and in fact s. 28 may have been designed to
prevail in situations such as this, given that public safety often trumps other
policy goals. In light of its conclusion that the Ministers decision to
restrict public access to the Site was reasonable, the Divisional Court did not
determine whether there is so little remaining public frontage on the body of
water that s. 3 requires the Ministry to set aside the Site for recreational
and access purposes, or whether a portage passed over the Site  both disputed
issues.

[5]

On appeal, the Township renews its arguments
before the Divisional Court that a portage protected by s. 65(4) passes over
the Site, and that there is so little remaining public frontage on the body of
water that s. 3 requires the Minister to set aside the frontage at the Site
for recreational and access purposes. It submits that given these protected
rights under the Act, the decision of the Minister to prohibit those activities
was unreasonable.

[6]

The Township also argues that in obstructing the
alleged portage, the Minister would interfere with navigation rights, protected
at common law and regulated under the
Navigation Protection Act
,
R.S.C. 1985, c. N-22, as amended.

[7]

We see no basis for interfering with the Divisional
Courts decision.

[8]

The Divisional Court identified the appropriate
standard of judicial review and applied it correctly. As the Divisional Court
noted, s. 28 is not made subject to any other provisions of the Act, and ss. 3
and 65(4) are not stated to prevail over s. 28. Given the safety concerns, the
Ministers decision was reasonable, even if a portage protected by s. 65(4)
existed, or s. 3 applied to the Site. The Ministers decision fell within a
range of possible, acceptable outcomes which are defensible in respect of the
facts and law.

[9]

The common law public right of passage over a
navigable waterway does not include the right to portage over anothers land:
Canoe
Ontario v. Reed
(1989), 69 O.R. (2d) 494 (H.C.J). Section
2(1) of the Act provides that the Minister has charge of the management of the
public lands. Therefore, subject to any aboriginal and treaty rights, the
Minister has the right to make an order under s. 28(1) that has the effect of
prohibiting passage over portages. Further, Transport Canada has provisionally
concluded that navigation would not be substantially impacted by the proposed
waterpower generation facility. It identified a different portage route as the
primary, and Transport Canada recommended, portage through the Bala Falls area.

[10]

In
obiter
, the Divisional
Court expressed doubt as to whether, if there were a portage, s. 65(4) would
apply. In this case, the Minister intends to lease the Site to the proposed operator
of the new waterpower generation facility. The Divisional Court reasoned that
the words sold or otherwise disposed of in s. 65(4) did not include a
lease of Crown lands and any existing portage would therefore not be protected
by s. 65(4). In disposing of this appeal it is not necessary to address this
issue of interpretation. By dismissing this appeal, we do not endorse the Divisional
Courts reasoning on this point.

[11]

In addition to asking this court to set aside
the Ministers decision, the Township asked that this court grant the Ancillary
Orders (with the exception of the order enjoining the grant of a lease and
agreement for the construction and occupation of a waterpower generation facility
on the Site, which it concedes this court cannot issue against the Crown). As noted
above, the Divisional Court determined that the Ministers decision was
reasonable without having to make findings on the existence of the alleged
portage and the sufficiency of the frontage and dismissed the Townships
application for the Ancillary Orders. The Township did not argue that the
Divisional Court erred in setting aside the Ministers decision without
determining those issues; it seeks the Ancillary Orders as part of its appeal
of the Divisional Courts dismissal of its application for an order setting aside
the Ministers decision. In light of our agreement that s. 28 of the Act is not
subject to ss. 3 and 65(4) and that the Ministers decision to restrict public
access to the Site for safety reasons was reasonable, even if a portage
protected by s. 65(4) existed, or s. 3 applied to the Site, we, like the Divisional
Court, find it unnecessary to address these additional issues.

[12]

This appeal is accordingly dismissed. The
respondents, the Crown and Swift River Energy Limited, shall each be entitled
to costs, fixed in the amount of $8,500, inclusive of HST and disbursements.



Alexandra Hoy A.C.J.O."

E.E. Gillese J.A.

P.
Lauwers J.A.


