



COURT OF APPEAL FOR ONTARIO

CITATION: Hydro One Networks Inc. v. Niagara Radio Group
    Inc., 2021 ONCA 719

DATE: 20211014

DOCKET: C68476 & C68477

Hourigan, Huscroft and Coroza JJ.A.

BETWEEN

Hydro One Networks Inc.

Applicant (Respondent)

and

Niagara Radio Group Inc., Northguard Capital
    Corp. and Andrew Ferri

Respondents (Appellants)

and

Scargall Owen-King LLP

Intervener (Respondent)

Amanda McBride and Daniel Michaud-Shields, for the
    appellants

Reeva M. Finkel and Brendan Jones, for the respondent
    Hydro One Networks Inc.

Colby Linthwaite, for the respondent Scargall Owen-King
    LLP

Heard: October 6, 2021

On appeal from the order of Justice Meredith Donohue of the Superior
    Court of Justice, dated February 19, 2020 and the judgment dated March 13, 2020,
    with reasons at 2020 ONSC 1029, and from the costs order, dated May 6, 2020,
    with reasons at 2020 ONSC 2819.

REASONS FOR DECISION

Introduction

[1]

The corporate appellants own land in the Niagara region. The appellant
    Andrew Ferri is the directing mind for both corporate appellants. The
    respondent Hydro One has transmission assets on the land. Hydro One has
    maintained these assets since 1925, and before the appellants acquired the
    land, Hydro Ones interest in the land was the subject of various license
    agreements with the previous owners. In 2008, after the land had changed hands,
    Mr. Ferri delivered a notice of cancellation of Hydro Ones license. The
    parties began negotiations to resolve the issue. The appellants were
    represented by a law firm during the negotiations. Over the course of these
    negotiations, the law firm billed the appellants for its work. The appellants
    never paid the account.

[2]

In 2018, the parties executed an easement agreement. Mr. Ferri signed
    the agreement on April 27, 2018 and he provided an irrevocable direction for
    Hydro One to pay the legal account of the law firm, in trust, on closing.
    Hydro One signed the agreement on May 4, 2018 and there were a number of
    closing dates set by the parties. The closing date was ultimately set for
    August 8, 2018.

[3]

Hydro One tendered on the appellants solicitor on August 8, 2018. However,
    the appellants refused to close. Hydro One then brought an application for
    specific performance and the law firm was also granted leave to intervene in
    the application.

[4]

The application judge granted the application for specific performance
    of the easement agreement and also ordered that law firms legal fees be paid
    out of the closing proceeds.

Issues

[5]

The appellants essentially make four submissions on this appeal:

1.

The application judge made palpable and overriding errors in finding
    that the easement agreement was binding and in her interpretation of the
    agreement.

2.

The application judge erred in her calculation of interest owed by Hydro
    One to the appellants.

3.

The application judge erred in granting the law firm of Scargall
    Owen-King intervener status.

4.

The costs awarded to the respondents were grossly excessive.

Analysis

[6]

First, the appellants complain that the application judge erred in finding
    that the easement agreement was binding because of palpable and overriding
    error. The appellants take issue with the application judges interpretation of
    the relevant clauses of the agreement and argue that appellants were justified
    in refusing to close on August 8 because there had been no meeting of the
    minds.

[7]

We reject these submissions. The application judge found that all
    essential elements of the material terms were clearly set out in the agreement
    and that the appellants, who had caused the delays in closing, acted
    unreasonably in refusing to close on August 8. After finding that the easement
    agreement was binding, the application judge found that specific performance
    was appropriate. The appellants numerous criticisms about the application
    judges interpretation of the agreement are without merit.

[8]

Second, the appellants argue that the application judge erred in her calculation
    of the total interest owed to the appellants by Hydro One. In summary, the application
    judge found that the agreed upon fixed amount for interest was set at
    $379,972.87. The evidence also showed that Mr. Ferri was advised by his counsel
    that any change to this clause was a deal-breaker and that Mr. Ferri signed
    the agreement with a chart attached to the agreement that clearly showed $379,972.87
    was to be paid by Hydro One on closing. We see no error in how the application
    judge approached the issue of interest.

[9]

Third, the appellants complain that the application judges decision to
    grant the law firm leave to intervene in the application caused undue prejudice
    during the proceedings. Rule 13.01 of the
Rules of Civil Procedure
, R.R.O.
    1990, Reg. 194 permitted the application judge to grant leave to the law
    firm to intervene. The application judge identified the factors to consider,
    and she concluded that the law firm would bring relevant facts and submissions
    to the inquiry about the agreement and that the intervention would not cause
    any delay or prejudice to the proceeding. This was a discretionary call and we
    defer to her decision.

[10]

Finally,
    we do not accept the appellants argument that the costs imposed by the
    application judge were excessive. In fixing costs, the application judge
    correctly identified that a successful litigant is generally entitled to their
    costs. The application judge also recognized that interveners are not normally
    awarded costs, but she noted that the law firm had a direct interest in the
    outcome and had been entirely successful. She specifically awarded the law firm
    substantial indemnity costs because she found that the appellants had made unwarranted
    attacks on the moral and professional integrity of the lawyer retained to negotiate
    the easement agreement. Her findings regarding costs were firmly rooted in the
    record.

Disposition

[11]

While
    other arguments were raised in the appellants factum, they were not pressed in
    oral argument and we are not persuaded that they have merit. For the foregoing
    reasons, the appeal is dismissed. Leave to appeal costs is denied.

[12]

We
    fix costs for the appeal in the amount of $30,000 to each respondent all
    inclusive on a partial indemnity scale.

C.W. Hourigan J.A.

Grant Huscroft J.A.

S. Coroza J.A.


