



COURT OF APPEAL FOR ONTARIO

CITATION: Armstrong v. Moore, 2020 ONCA 49

DATE: 20200127

DOCKET: C66333

Strathy C.J.O., MacPherson and
    Jamal JJ.A.

BETWEEN

William
    John Armstrong and Teresa Jesus Armstrong

Plaintiffs (Appellants/Respondents by
    Cross-Appeal)

and

Howard Moore
,
Laureen Margaret Moore
,
Larry Joseph Edwards
,
Colleen
    Elizabeth Edwards
, Wayne Cartwright, Janet Cartwright, Julie Edwards,
    Lawrence Henry Hierlihy, Jeannette Theodora Hierlihy, Gloria Mae Edmunds,
    Carolee Stacey Hofman, Donald Demers and
Robert William Moore

Defendants (
Respondents
/
Respondents
    and Appellants by Cross-Appeal
)

Stuart R. Mackay, for the
    appellants/respondents by way of cross-appeal William John Armstrong and Teresa
    Jesus Armstrong

Shawn J. OConnor, for the
    respondent/appellant by way of cross-appeal Robert William Moore

Joseph W.L. Griffiths and Matthew G. T.
    Glass, for the respondent/appellant by way of cross-appeal Howard Moore and for
    the respondent Laureen Margaret Moore

No one appearing for the
    self-represented respondent Lisa Coutu (written submissions only)

No one appearing for the respondents Larry
    Joseph Edwards and Colleen Elizabeth Edwards

Heard: January 13, 2020

On appeal
    from the judgment of Justice Calum U.C. MacLeod of the Superior Court of
    Justice, dated November 27, 2018, with reasons reported at 2018 ONSC 7056, 5
    R.P.R. (6th) 316.

REASONS
    FOR DECISION

A.

overview

[1]

This appeal, involving claims for adverse
    possession and damages, arose in connection with the placement of an outhouse
    by one cottager on another cottagers property, with permission, for over 40
    years. The dispute arose when renovation activities on one property resulted in
    a washout of dirt that allegedly rendered unusable the outhouse and the cottage
    it serviced.

[2]

After a seven-day trial, the trial judge
    dismissed the appellants claim for adverse possession of a small
area
of land surrounding the outhouse but awarded them nominal compensatory and
    punitive damages, for a total of $15,000. The parties now appeal and
    cross-appeal that decision to this court.

[3]

At the conclusion of the oral argument we

dismissed the appeal and cross-appeal,
    with reasons to follow. These are our reasons.

B.

background facts

[4]

In 2003, the appellants William and Teresa
    Armstrong bought a cottage on the Ottawa River near Pembroke, Ontario. The
    cottage, purchased for $38,000, had no indoor plumbing and is accessible only
    via an access road along a deeded right of way on the property of the
    respondents Howard and Laureen Moore. The only toilet servicing the Armstrong
    property was an outhouse located on a non-travelled portion of the right of way,
    where it had been for over 40 years. A shed stood next to the outhouse and both
    were sheltered by mature cedar trees. Although the outhouse and shed were on
    the Moores land, the Armstrongs treated them as part of their cottage.

[5]

In 2006, Howard and Laureens son, the
    respondent Robert Moore, acquired property uphill from the Armstrongs property
    and began renovations. In 2007, Robert placed a large amount of fill on his
    land. When William Armstrong raised concerns with Robert and Howard Moore that the
    fill might seep onto his property, he was rudely rebuffed: Robert told him that
    it sucks to be at the bottom of the hill and suggested he get some sandbags,
    while Howard told him to get a lawyer if he was dissatisfied.

[6]

Later in 2007, a washout on Roberts
    property caused mud and water to surround and enter the Armstrongs outhouse.
    The Armstrongs alleged that this rendered their cottage unusable because they
    now had no toilet and they believed they could not get a permit to build a new
    one. They retained an engineer in 2008 who advised them that they were at risk
    of future washouts and recommended that they install a retaining wall.

[7]

The Armstrongs did not use their cottage
    again.

[8]

In 2009, the Armstrongs sued Robert Moore for
    $250,000 in compensatory and punitive damages, claiming that his
    negligence resulted in the loss of the use and enjoyment of their cottage.

[9]

Also in 2009, Howard Moore learned of potential
    claims for adverse possession in connection with his property. He cut down the cedars
    sheltering the outhouse and shed, removed the tree stumps, and posted signs warning
    other residents that they might lose their right of way if the adverse
    possession claims succeeded. Later, the shed and outhouse were destroyed when
    someone dumped snow and gravel on them.

[10]

In 2011, the Armstrongs began a second action
    claiming adverse possession of the lands involving the outhouse, shed, and
    surrounding cedars, and $100,000 in damages against Howard, Laureen, and Robert
    Moore and others for the destruction of their outhouse and shed, for the loss
    of the use of their cottage, and for promoting animosity against them.

[11]

Most of the other defendants in the second
    action were property owners whose property was accessed by the right of way. While
    most did not participate in the action or appeal, Lisa Coutu filed written
    submissions with this court explaining that she and Deric Coutu had contributed
    to the maintenance and improvement of the right of way since buying their
    property in 2012 and that losing the right of way would impede service vehicles
    from accessing homes to the south of the Armstrongs cottage.

C.

the trial judges decision

[12]

Both actions were heard together in a joint
    trial. The trial judge rejected the adverse possession claim because he
    concluded that the Armstrongs had not established that their predecessors in
    title had intended to permanently exclude the rights of the registered owners of
    the fee or of the right of way.

[13]

The trial judge found Robert Moore negligent in placing
    fill on his land in a way that unreasonably interfered with the rights of his
    neighbours. However, he found that the Armstrongs had failed to prove the
    quantum of their damages and had not mitigated their loss by cleaning up,
    repairing, or rebuilding their outhouse. He therefore awarded only nominal
    damages of $5,000 for the cost of cleanup, repair, and reconstruction, and
    $2,000 for the interruption in the use of the cottage.

[14]

The trial judge also found Howard Moore liable
    for aiding, abetting, and encouraging the destruction of the outhouse. He found
    that Howard knew that the Armstrongs depended on the outhouse and that it would
    be difficult to use their property without it. He also found that Howards conduct
    in removing the cedars without advising the Armstrongs contributed to the
    destruction of the outhouse and shed and that Howard encouraged vandalism and engaged
    in intimidation. Since by then the outhouse had already been damaged by Roberts
    negligence and there were frailties in the Armstrongs evidence as to their damages,
    the trial judge assessed nominal damages against Howard at an additional
    $3,000.

[15]

Finally, the trial judge found Howard liable for
    $5,000 in punitive damages for exacerbating the conflict between the parties, exposing
    the outhouse to further damage by removing the cedars, encouraging vandalism,
    engaging in intimidation, and for spoliation of evidence to impede the adverse
    possession claim by removing the cedars and their stumps so that their age
    could not be verified.

D.

Issues

[16]

The Armstrongs appeal on the issues of adverse
    possession, abandonment of the rights of way by other property owners, and the
    quantum of compensatory and punitive damages. Robert and Howard Moore
    cross-appeal on the issues of compensatory and punitive damages.

[17]

The four issues are thus: (1) adverse
    possession; (2) abandonment of rights of way; (3) compensatory damages; and (4)
    punitive damages.

E.

Analysis

(1)

Did the trial judge err in rejecting the

Armstrongs claim for adverse possession?

[18]

To succeed on a claim for adverse possession, a claimant must
    establish possession that is open, notorious, constant, continuous, peaceful
    and exclusive of the right of the true owner throughout a ten-year period:
Real
    Property Limitations Act
, R.S.O. 1990, c. L.15, s. 4. The claimant must
    prove: (i) actual possession of the land in issue; (ii) an intention to exclude
    the true owner from possession of their land; and (iii) effective exclusion of
    the true owner from possession of their land:
Barbour v. Bailey
, 2016
    ONCA 98, 345 O.A.C. 311, at paras. 35-36;
McKay v. Vautour
, 2020 ONCA
    16, at para. 7. The ten-year period of possession must have occurred entirely before
    the land was placed under the land titles system. Adverse possession cannot
    arise after that time but is preserved if already acquired:
Land Titles Act
,
    R.S.O. 1990, c. L.5, s. 51;
McKay
, at para. 6.

[19]

Here, because the disputed land was placed under the land titles
    system in August 1998, the Armstrongs had to establish that their claimed right
    to adverse possession had crystallized before then.

[20]

The trial judge found that the Armstrongs easily met the first
    requirement for adverse possession: their predecessors in title had actual
    possession of the disputed land and used it as if it was a part of the cottage.
    He found clear evidence of continuous use for at least 30 years prior to 1998
    and quite likely longer.

[21]

However, the trial judge concluded that the Armstrongs had not
    established the second and third requirements: an intention to exclude and
    effective exclusion of the true owner from possession. For adverse possession,
    [t]he element of adversity means that the claimant is in possession without
    the permission of the true owner:
Teis v. Ancaster (Town)
(1997), 35
    O.R. (3d) 216 (C.A.), at p. 221. Or, as the trial judge stated, in a claim for
    adverse possession permission is fatal. He noted that the outhouse had been
    moved by one of the Armstrongs predecessors in title at the request of another
    landowner to whom Howard and Laureen Moore had sold property on which the
    outhouse had formerly been located. The trial judge found that this raises an
    inference that the outhouse was originally put in the new location with the
    consent of the Moores. He also found it troubling that the Armstrongs had not called
    evidence from their predecessors in title or explained why such evidence could
    not be adduced.

[22]

The Armstrongs assert that the evidence did not permit the trial
    judge to infer that the outhouse was placed in its current location with the Moores
    consent or permission and that he conflated permission with acquiescence.

[23]

We do not accept this submission. Absent palpable and overriding
    error or an extricable error of law, this court must defer to a trial judges
    findings of fact, inferences drawn from the facts, and the inference-drawing
    process itself:
Housen v. Nikolaisen
, 2002 SCC
    33, [2002] 2 S.C.R. 235, at paras. 6, 10, 19, 23;

Nelson (City) v. Mowatt
, 2017 SCC 8,
    [2017] 1 S.C.R. 138, at para. 38.

[24]

The Armstrongs have not met this exacting standard. There was an
    evidentiary basis for the inference that the Moores gave permission as to the
    placement of the outhouse on their land. The Moores were involved in the
    decision as to where to relocate the outhouse when it was moved from one part
    of their property to another part, such that the trial judge could infer that
    they did not merely acquiesce in but rather gave their permission as to where
    it was placed. In our view, on the evidence the trial judge was entitled to
    infer permission. There is no basis for this court to intervene.

(2)

Did the trial judge err in rejecting the Armstrongs
    claim that the other property owners had abandoned their rights of way?

[25]

The Armstrongs assert that the trial judge also erred in finding that
    the other property owners had not abandoned their rights of way. The Armstrongs
    contend that the trial judge conflated the test for adverse possession with
    the test for abandonment of easement.

[26]

We do not accept this submission. The trial judge found on the
    evidence that the Armstrongs predecessors in title did not intend to exclude permanently
    the rights of way of the other property owners, and that the use actually made
    of the land was not obviously inconsistent with their rights. As the trial
    judge noted, as a matter of law those property owners did not have to prove use
    of their rights of way in order to avoid losing them; indeed, the intention to
    abandon an expressly granted right of way cannot be presumed merely as a result
    of non-use:
Bison Realty Ltd. v. Athersych
(1998), 19 R.P.R. (3d) 48 (Ont.
    C.J.), at para. 82, affd (2000) 135 O.A.C. 226 (C.A.). In our view, the trial
    judge correctly identified the applicable legal principles and his application
    of those principles is entitled to deference. We therefore have no basis to intervene.

(3)

Did the trial judge err in awarding the appellants nominal
    compensatory damages against Robert and Howard Moore?

[27]

Both the Armstrongs and the Moores impugn the trial judges decision
    to award the Armstrongs nominal compensatory damages for Robert Moores
    negligence in causing damage to and loss of use of the outhouse and for Howard
    Moores aiding, abetting, and encouraging the destruction of the outhouse. The
    Armstrongs complain that the trial judge awarded too little; the Moores
    complain that he awarded too much.

[28]

We reject both positions.

[29]

The plaintiff bears the burden of proving their damages on the
    balance of probabilities. Where damages are difficult to assess, the court must
    do the best it can in the circumstances. But where the absence of evidence
    makes it impossible to assess damages, the court may award nominal damages:
TMS
    Lighting Ltd. v. KJS Transport Inc.
, 2014 ONCA 1, 314 O.A.C. 133, para. 61,
    citing
Martin v. Goldfarb
(1998), 41 O.R. (3d) 161 (C.A.), at para. 75,
    leave to appeal refused, [1998] S.C.C.A. No. 516.

[30]

Once the applicable legal principles are correctly identified, a trial
    judges assessment of damages attracts considerable deference before this
    court. Appellate interference is justified only where the trial judge made an
    error in principle, misapprehended the evidence, failed to consider relevant
    factors, considered irrelevant factors, made an award without any evidentiary
    foundation, or otherwise made a wholly erroneous assessment of damages:
TMS
    Lighting Ltd.
, at para. 60.

[31]

Here, the trial judge correctly identified the applicable legal
    principles. We do not accept the Armstrongs submission that the trial judge erred
    by improperly assessing the Armstrongs damages in 2018, with the benefit of
    hindsight that there had been no further washouts of their property, rather
    than from the perspective of 2008, when it was reasonably foreseeable based on their
    engineers report that there might be further washouts. This was only one
    factor, among several, for the trial judges conclusion that the Armstrongs
    were entitled to damages for only a short-term interruption of use of their
    cottage.

[32]

We also disagree with the Moores submission that they could not be
    liable for damage to the outhouse because Howard and Laureen owned the land on
    which the outhouse was situated. The trial judge correctly concluded that the
    outhouse was a chattel that the Armstrongs owned, rather than a fixture forming
    part of the land, because it had been moved on occasion and was purchased with
    the Armstrongs cottage. The trial judge found that the outhouse was located on
    the Moores land with their permission, and that Howard Moore was reckless if
    not deliberate and negligent if not intentional in taking actions that exposed
    it to foreseeable harm.

[33]

Having correctly identified the applicable legal principles, the
    trial judges decision to award only nominal damages is entitled to deference.
    He awarded modest nominal compensatory damages ($10,000 in total) because he
    was persuaded that the Armstrongs had suffered damage that has a measurable
    cost, but he was hampered by the absence of specific evidence as to the
    quantum of their damages, and he was satisfied that any further inquiry into
    the quantum would be disproportionate given the low amounts of damages
    potentially recoverable. We see no basis for this court to intervene with this
    decision.

(4)

Did the trial judge err in awarding the
    appellants nominal punitive damages against Howard Moore?

[34]

Lastly, the Armstrongs appeal and Howard Moore cross-appeals the nominal
    ($5,000) punitive damages awarded. The Armstrongs say the amount should have
    been $40,000, while Howard Moore says that none were justified.

[35]

Appellate deference is owed to a trial judges decision to award
    punitive damages, provided that they are a rational response to the facts, that
    is, where the misconduct of the defendant is so outrageous that punitive
    damages are rationally required to act as deterrence:
Whiten v. Pilot
    Insurance Co.
, 2002 SCC 18, [2002] 1 S.C.R. 595, at paras. 76, 100;
Pita
    Royale Inc. (Aroma Taste of the Middle East) v. Buckingham Properties Inc.
,
    2019 ONCA 439, 1 R.P.R. (6th) 1, at para. 27, leave to appeal refused, [2019]
    S.C.C.A. No. 307.

[36]

In our view, there was a rational basis for the trial judges
    decision to award nominal punitive damages given his findings that Howard Moore
    exacerbated the conflict between the parties, exposed the outhouse to further
    damage by removing the cedars, encouraged vandalism, and engaged in intimidation.
    The trial judge was entitled to find these acts justified a punitive award as malicious,
    oppressive, and high-handed misconduct that offends the courts sense of decency:
Whiten
, at para. 36, citing
Hill v. Church of Scientology of
    Toronto
, [1995] 2 S.C.R. 1130, at para. 196. It was open to the trial
    judge to conclude that punitive damages in this amount were rationally
    required.

[37]

However, we defer to another day whether a court is entitled to rely
    on spoliation of evidence as providing a basis for awarding punitive damages. Ontario
    jurisprudence has yet to resolve definitively whether spoliation is a cause
    action: See
Spasic Estate v. Imperial Tobacco Ltd.
(2000), 49 O.R.
    (3d) 699 (C.A.), at paras. 12, 22; leave to appeal refused, [2000] S.C.C.A. No.
    547. In our view, that issue need not and should not be resolved in this
    appeal.

F.

Conclusion

[38]

The appeal and cross-appeal are dismissed. As agreed by the parties,
    given the divided success there shall be no order as to costs.

G.R. Strathy C.J.O.

J.C. MacPherson J.A.

M. Jamal J.A.


