



COURT OF APPEAL FOR ONTARIO

CITATION: Owen Sound (City) v. Naidal
    Incorporated, 2019 ONCA 804

DATE: 20191008

DOCKET: C66736

Sharpe, Hourigan and Jamal JJ.A.

BETWEEN

The Corporation of the City of
    Owen Sound

Appellant
(Respondent)

and

Naidal Incorporated

Respondent
(Appellant)

Ondrej Sabo, for the appellant

Errol Treslan, for the respondent

Heard: October 3, 2019

On appeal from the order of the
    Divisional Court (Justices Carolyn J. Horkins, Harriet E. Sachs and Julie A.
    Thorburn), dated October 17, 2018, with reasons reported at 2018 ONSC 6207,
    affirming the decision of the Ontario Municipal Board, dated October 5, 2017,
    with reasons reported at 2017 CanLII 66334 (ON LPAT).

REASONS FOR DECISION


[1]

This appeal concerns the applicable scale of
    costs when a municipality unsuccessfully appeals an expropriation matter to the
    courts.

[2]

The Ontario Municipal Appeal Board (OMB)
    ordered the respondent to compensate the appellant when the respondent
    expropriated its property. The respondent then appealed parts of the OMBs decision
    to the Divisional Court.

[3]

The Divisional Court dismissed the respondents
    appeal and ordered partial indemnity costs of the appeal to the appellant of
    $7,500, rather than the claimed full indemnity costs of $23,586.84. The
    appellant had relied on s. 32(1) of the
Expropriations

Act
,
    R.S.O. 1990, c. E.26, which in relevant part requires the OMB to 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. The Divisional Court declined to apply this provision
    and ruled that because this was a court proceeding rather than a proceeding
    before the OMB, the ordinary costs rules apply.

[4]

The appellant now appeals the costs order, with
    leave granted by this court on March 21, 2019, and asks the court to substitute
    an order for full indemnity costs. The respondent does not dispute that the Divisional
    Court erred in law but asserts that the costs claimed by the appellant are
    unreasonable.

[5]

Section 32(1) of the
Expropriations

Act
,
    as it appeared before statutory amendments made in April 2018, provided as
    follows:

Costs

32 (1) Where the amount to which an
    owner is entitled upon an expropriation or claim for injurious affection is
    determined by the Board and the amount awarded by the Board is 85 per cent, or
    more, of the amount offered by the statutory authority,
the Board shall make
    an order directing the statutory authority to pay the reasonable legal,
    appraisal and other costs actually incurred by the owner for the purposes of
    determining the compensation payable
, and may fix the costs in a lump sum
    or may order that the determination of the amount of such costs be referred to
    an assessment officer who shall assess and allow the costs in accordance with
    this subsection and the tariffs and rules prescribed under clause 44 (d).
    [Emphasis added.]

[6]

While on its face s. 32(1) applies only to
    proceedings before the OMB, this court has accepted that it should give effect
    to the principle reflected in this provision when considering the costs payable
    to a claimant in successfully resisting an appeal taken by a municipal
    corporation from an expropriation award. As stated by Kelly J.A. in
Re A.M.
    Souter & Co. Ltd. and City of Hamilton
(1973), 1 O.R. (2d) 760 (C.A.),
    at p. 761:

In our opinion, there is in the
Expropriations

Act
an expressed intention that a claimant who, involuntarily, has
    to resort to the procedures set down in the Act in order to secure the
    compensation to which he is adjudged entitled, is to have, in addition to this
    compensation, the reasonable legal, appraisal and other costs actually incurred
    by him for the purpose of determining the compensation payable.

The discretion of the Court with respect to
    costs is not disturbed by the provisions of the statute referred to, although
    the principle above stated must be kept foremost in mind. In a case such as
    this one the Court should give effect to the principle set forth in s. 33(1)
    [now s. 32(1)] and the costs of successfully resisting the appeal taken by the
    municipal corporation from the award should be taxed as between solicitor and
    client.

[7]

See also
Parks v. Ontario (Ministry of
    Transportation
)
(1997), 109 O.A.C. 1 (Div. Ct.), at p. 18.

[8]

In our view, the Divisional Court erred in law
    by not keeping foremost in mind the principle reflected in s. 32(1)  that the
    appellant was entitled to its reasonable legal, appraisal, and other costs
    actually incurred in resisting the respondents appeal to the Divisional Court.

[9]

The respondent contends that the amount claimed
    for the appeal to the Divisional Court of $23,586.84 was unreasonable for several
    reasons, especially because the subject matter of the Divisional Court appeal
    was valued at only $16,000. We do not agree. In our view, the amount claimed
    was reasonable on a full indemnity basis for an appeal to the Divisional Court
    in which the appellant was responding to the respondents expropriation appeal.

[10]

The appeal is allowed. The appellant shall have
    its costs fixed on a full indemnity basis, inclusive of disbursements and
    taxes, in the amounts of $23,586.84 for the appeal to the Divisional Court and
    $11,622.50 for the motion for leave to appeal and the appeal to this court.

Robert J. Sharpe J.A.

C.W. Hourigan J.A.

M. Jamal J.A.


