



COURT OF APPEAL FOR ONTARIO

CITATION: Beniuk v. Leamington
    (Municipality), 2020 ONCA 238

DATE: 20200325

DOCKET: C66773

van Rensburg, Paciocco and
    Thorburn JJ.A.

BETWEEN

Angela and Dennis Beniuk

Plaintiffs (Appellants)

and

The Corporation of the
    Municipality of Leamington

Defendant (Respondent)

Raymond G. Colautti and Eric Florjancic,
    for the appellants

Tom Serafimovski and Samuel Atkin, for
    the respondent

Heard: November 21, 2019

On appeal from the order of Justice Thomas
    J. Carey of the Superior Court of Justice, dated March 21, 2019, with reasons
    reported at 2019 ONSC 1830, 88 M.P.L.R. (5th) 295.

van Rensburg J.A.:

OVERVIEW

[1]

The appellants, Angela Beniuk and Dennis Beniuk,
    live at 1735 Concession East, R.R. #1 (the Beniuk residence) in the
    Municipality of Leamington, Ontario (the Municipality or the respondent).
    The Beniuk residence closely abuts Mersea Road East, a rural road originally
    constructed as a farm access trail.

[2]

Beginning in the summer of 2006, Mersea Road
    East experienced a significant increase in heavy truck traffic. The appellants and
    their neighbours made repeated complaints to the Municipality, and at a council
    meeting in February 2008, they expressed concern that the truck traffic was
    causing damage to their property. The Municipality declined to reconstruct the
    road.

[3]

The appellants retained an engineering firm whose
    report concluded that structural damage to the Beniuk residence was caused by
    vibrations transferred to the home from heavy truck traffic on Mersea Road East.

[4]

In December 2009, the appellants commenced a proceeding
    before the Ontario Municipal Board (the OMB) claiming that the Municipalitys
    pre-1927 construction of the road caused injurious affection. Pursuant to the
Expropriations
    Act
, R.S.O. 1990, c. E.26, the OMB (now the Local Planning Appeal
    Tribunal) has exclusive jurisdiction over injurious affection claims.

[5]

In written reasons issued on January 10, 2018, the
    OMB determined that it did not have jurisdiction over the appellants claim.
    The OMB concluded that the claim for damage caused by traffic vibrations
    subsequent to the roads construction, which was in respect of the use of the
    road and not its construction, was not a claim for injurious affection.

[6]

After receiving the OMBs decision, the appellants
    commenced a civil action in the Superior Court claiming damages for nuisance
    and negligence. The Municipality moved for summary judgment dismissing the
    action. The motion judge found in the Municipalitys favour, concluding that
    the action was statute-barred and that the duty of care under s. 44 of the
Municipal
    Act, 2001
, S.O. 2001, c. 25 (the 
Municipal Act
), to keep roads
    in a reasonable state of repair, is not owed to adjoining landowners.

[7]

The Beniuks appeal the summary dismissal of their
    action on four grounds. Three relate to the respondents limitation period
    defence; one relates to the s. 44 duty of care issue.

[8]

First, the appellants submit that the motion
    judge erred in concluding that their action was subject to the basic two-year
    limitation period under s. 4 of the
Limitations Act, 2002
, S.O. 2002,
    c. 24, Sched. B (the 
Limitations Act
), and not the ten-year
    limitation period under s. 4 of the
Real Property Limitations Act
,
    R.S.O. 1990, c. L.15 (the 
RPLA
). Second, the appellants assert that,
    if the two-year limitation period applies, the motion judge erred in rejecting
    their argument that, under s. 5(1)(a)(iv) of the
Limitations Act
, it
    was not legally appropriate to commence their civil action until after the
    OMB released its decision. Third, the appellants contend that the motion judge
    overlooked evidence of damage to their property within the two-year period
    before they commenced their action; they argue that even if they are statute-barred
    from suing the respondent for conduct occurring prior to that two-year period, they
    should be allowed to continue their action with respect to such damage. Fourth,
    they submit that the motion judge erred in rejecting their claim under s. 44 of
    the
Municipal Act
on the basis that the duty of care is only owed to users
    of the road and not to adjoining landowners.

[9]

For the reasons that follow, I would allow the
    appeal.

[10]

Briefly, I have concluded that there was no
    error in the motion judges conclusions that a two-year limitation period
    applied and that most of the appellants civil action is statute-barred under
    s. 4 of the
Limitations Act
. However, I would permit the action to
    continue with respect to damage to the appellants property within the two-year
    period before the action was commenced. The record supports the existence of
    such damage and there is a genuine issue requiring a trial as to whether the
    limitation period has expired in respect of ongoing tortious conduct of the
    respondent resulting in such damage. Finally, I would leave open for trial the
    issue of whether the statutory duty of care under s. 44 of the
Municipal
    Act
was owed to the appellants by the Municipality. This question, which
    was decided summarily by the motion judge, should remain open to be determined
    at the time that the appellants claim for nuisance is considered. It is
    neither appropriate nor necessary to resolve the issue of the proper scope of
    s. 44 on the limited record and arguments on this appeal.

FACTS

Damage to the Beniuk Residence and Traffic on
    Mersea Road East

[11]

The Beniuk residence is a one-storey, wood-framed
    dwelling with a basement and detached barn. It was constructed by Mr. Beniuks
    grandfather around 1938-1940. The Beniuk residence is located roughly 14 feet
    from the paved portion of Mersea Road East.

[12]

The volume of heavy truck traffic on Mersea Road
    East significantly increased beginning in the summer of 2006. The appellants
    evidence was that, at peak times, they documented one heavy transport truck every
    20 minutes and that the trucks would drive well in excess of the posted speed
    limit of 40 km/h. The appellants theory is that the increase in truck traffic resulted
    from the use of a neighbourhood farm as a warehouse for a local food processor
    and other neighbouring farm properties as packing sheds, possibly in violation
    of zoning bylaws.

[13]

Between December 2007 and February 2008, the appellants
    and their neighbours communicated with the Municipality about the increase in
    heavy truck traffic, attending council meetings and writing letters. On
    February 11, 2008, the appellants attended a council meeting to communicate
    that the truck traffic was causing damage to their property.

[14]

The municipal council instructed the
    administration to review the condition of the road pavement and assess
    alternative road improvement alternatives. According to a report dated January
    21, 2008, prepared by the Manager of Engineering Services and the Director of Community
    Services, Mersea Road East was built on the remnants of a former marsh. In
    2008, the road structure consisted of a mixture of old wetland organic
    materials with clay, overlaid with a poor-quality granular material varying in
    depth from 0.1 m. to 0.3 m. (4 in. to 12 in.). The report noted that the
    engineering firm Golder Associates was of the view that the road could be
    rebuilt by excavating the existing road base and placing a new layer of good
    quality granular material and asphalt, at a cost of approximately $480,000.
    These suggested changes were based on low traffic volumes and a limited number
    of heavy truck trips. The report also recommended changes to the municipal
    heavy truck bylaw.

[15]

The Municipality decided not to reconstruct the
    road.

[16]

The appellants then retained the engineering
    firm CSI Windsor. In its report dated February 28, 2009 (the CSI Windsor
    Report), the firm concluded that damage to the Beniuk residence, including
    cracks in the walls, tiles, ceiling finishes, and windows, was caused by
    vibrations transferred to the home from heavy truck traffic on Mersea Road East.

[17]

In December 2009, the appellants pursued a claim
    against the Municipality. They commenced proceedings before the OMB, by
    Statement of Claim and Notice of Arbitration, alleging that the Municipalitys
    original pre-1927 construction of the road constituted injurious affection
    under the
Expropriations Act
.

[18]

The Municipality delivered its Reply on January
    5, 2010. Among other things, the Municipality pleaded that the OMB claim was
    not a claim for injurious affection and that the OMB was not the proper forum
    or venue to determine the dispute.

The 2013 Road Repair and Evidence of Ongoing Damage

[19]

On May 29, 2013, the Municipality wrote to the appellants,
    advising them that the existing road base would be pulverized to construct a
    new Granular Road Base and New Tar and Chip Surface. Construction was to
    begin in two weeks. The record includes the call for tenders for this project,
    which is a 50-page document outlining the Municipalitys repair plan. In June
    2013 the road work was completed. On September 6, 2013, when the OMB asked the
    parties for an update, the appellants counsel sent a response indicating that
    the attempt to pulverize the road had no material effect in fixing the root
    problem.

[20]

The appellants allege that the damage to their
    house is ongoing. There is evidence that their basement flooded in May 2015.
    They retained a second forensic engineer, Luigi Lecce of LGL Consulting, to
    provide an updated report on the structural damage and building losses. The
    report, which is dated December 1, 2016 (the Lecce Report), stressed that the
    damage to the Beniuk residence was ongoing:

Some of the same sources that initially
    contributed to the reported stream of
Mechanical Damages
are
still
    ongoing
, and therefore preclude the possibility of a stable environment
    within which to mitigate the losses, and repair the Beniuk residence;



Similarly, the consequences that were
    associated with the suite of
Mechanical Damages
that were sustained by the Beniuk residence (between 2006 and 2009)
    and then re-introduced again (between 2009 and 2010), have not abated (
because
    the source of the physical disruptions has continued to persist
);



The nature and extent of the conditions
    created by the
ongoing nature
of both the physical disruptions &
    consequential damages are such that they have continued to prevent the
    mitigation of the sustained losses, and have continued to thwart other interim
    attempts aimed at repairing the Beniuk residence. Consequently, any useful (and
    lasting) progress, directed at resolving the losses, cannot currently be
    achieved;



The sources of the problems (that began to be
    reported by the [Appellants] in 2006) were found to stem from a variety of
    Synthetic events (i.e. Physical disruptions associated with the release of
    uncontrolled vibrations that were derived from designed/manufactured/mechanical
    sources, or otherwise generated by machinery)
which are still on-going
,
    and include the following:

The subject
Cause
of the problems (that continue to entail exposure to uncontrolled
Vibrations
,
    exposure to
Shock Waves
, forced physical
Displacement
,
    exposure to
Cyclic-Loading
conditions, and exposure to
Ground-Distortion
    Cycles
) originate along the 1934 municipal embankment structure (which
    currently supports the existing travelled roadway that serves as
Mersea
    Road E
)
whenever
Independent Heavy-Truck
traffic &
Tractor-Trailer
    Combinations
traverse the 380-foot stretch of roadway across the frontage
    of the Beniuk property
[Emphasis added.]

[21]

The appellants also produced photographs of
    heavy trucks passing by their home between June 2016 and June 2017.

[22]

The Municipality disputed the appellants
    evidence that there was ongoing damage. It had retained its own professional
    engineer, David C. McCloskey, to review the Lecce Report and to comment on the appellants
    action. Mr. McCloskey disagreed with a number of conclusions in the Lecce
    Report. In his report dated September 11, 2017, Mr. McCloskey noted that the
    Beniuk residence was over 66 years old in 2006 and likely exhibited typical
    damage and defects of similar structures of this age, namely: building settlement
    causing uneven floors and sticking windows and doors, cracks in
    plaster/drywall, etc. He also suggested that the truck traffic from 2006 to
    2008 would not have had a significant effect on the Beniuk residence:

It is our opinion
    that the passage of trucks, which were stated as not being more than three per
    hour or fifteen per day between 2006-2008, would not have had a significant
    effect on the underlying layer of firm, grey black, organic silty clay/clayey
    topsoil given truck loads are moving loads and the overlying granular soils
    would have acted to distribute the truck axle loads over a larger area at the
    surface of the firm, grey black, organic silty clay/clayey topsoil.

[23]

Mr. McCloskey also highlighted that vibrations
    from trucks are heightened depending on the speed of the trucks and the size
    and depth of the roads potholes. He stated that [i]f the road is smooth,
    ground vibrations from trucks would be minimal. The Municipality relied on
    this evidence to submit that, subsequent to the resurfacing of Mersea Road East
    in 2013, there would have been no damage from truck traffic, as the vibrations
    would have been minimal.

The OMB Decision

[24]

The parties dispute before the OMB did not
    resolve and, on February 16, 2012, they attended mediation. Examinations for
    discovery were held on June 12, 2014, and a hearing date was set for December
    4, 2017. The Board raised the question of jurisdiction, and the respondent
    asserted that its position was that this was not a claim for injurious affection,
    and that in any event, the limitation period for a claim before the Board had
    expired. The OMB heard submissions on these preliminary issues, and in written
    reasons issued on January 10, 2018, concluded that it did not have jurisdiction
    over the appellants claim because the claim did not constitute injurious
    affection under the
Expropriations Act
.

[25]

The OMB framed the jurisdictional issue as
    follows: can the original construction of a road by a statutory authority be
    considered injurious affection under the
Expropriations Act
when
    damage arises from the use of that road?

[26]

Subsection 1(1) of the
Expropriations Act
defines injurious affection as follows:

injurious affection means,

(a) where a statutory authority acquires part
    of the land of an owner,

(i) the reduction in market value thereby caused to the remaining
    land of the owner by the acquisition or by the construction of the works
    thereon or by the use of the works thereon or any combination of them, and

(ii) such personal and business damages, resulting from the
    construction or use, or both, of the works as the statutory authority would be
    liable for if the construction or use were not under the authority of a
    statute,

(b) where the statutory authority does not
    acquire part of the land of an owner,

(i) such reduction
    in the market value of the land of the owner, and

(ii) such personal and business damages,

resulting from the construction and not the
    use of the works by the statutory authority
, as the
    statutory authority would be liable for if the construction were not under the
    authority of a statute,

and for the
    purposes of this clause, part of the lands of an owner shall be deemed to have
    been acquired where the owner from whom lands are acquired retains lands
    contiguous to those acquired or retains lands of which the use is enhanced by
    unified ownership with those acquired[Emphasis in the OMBs decision.]

[27]

The appellants claim was under s. 1(1)(b),
    where the Municipality had not acquired any part of the appellants land. The
    OMB cited the Supreme Court of Canadas decision in
Antrim Truck Centre
    Ltd. v. Ontario (Ministry of Transportation)
, 2013 SCC 13, [2013] 1 S.C.R.
    594, at para. 5, which laid out three requirements that must be established
    under s. 1(1)(b):

(i) the damage must result from action taken
    under statutory authority;

(ii) the action would give rise to liability
    but for that statutory authority; and

(iii) the damage
    must result from the construction and not the use of the works.

[28]

The OMB concluded that the second requirement
    was met in this casethe ingredients of a nuisance claim were likely present
    based on the undisputed facts. However, it held that the first and third
    requirements had not been established.

[29]

With respect to the first requirement, the appellants
    submitted that the relevant action of the Municipality was its pre-1927
    construction of the road. The OMB rejected this submission for three reasons. First,
    it stated that the appellants claim was largely based on inaction as opposed
    to action. Their submission was essentially that the Municipality had failed to
    reconstruct the road to an appropriate standard and had failed to enforce its
    traffic and zoning by-laws, allowing the truck traffic problem to persist.
    According to the OMB, these were not actions of a statutory authority as
    contemplated by the [
Expropriations Act
]. Second, the OMB concluded
    that, even if it were to accept that the claim was based on the pre-1927 construction
    of the road, there was an evidentiary gap as to when the road was constructed
    or whether it was constructed under statutory authority. Third, the OMB stated
    that claims for injurious affection had to be brought by an owner at the time
    of or following the statutory action. According to the OMB, the appellants
    interpretation would result in a problematic floodgate of claims from former
    property owners who are dissatisfied with the condition and operation of their
    roads.

[30]

With respect to the third requirement in the
Antrim
test, the appellants acknowledged that the requirement was not strictly met.
    However, they submitted that their claim was novel and nuanced because it was
    about the continued use of a substandard road. While the OMB appreciated that
    the claim was novel, it could not reconcile the appellants submission with the
    well-established construction and not the use rule, citing
Windsor (City)
    v. Larson
(1980), 29 O.R. (2d) 669 (Div. Ct.) and referring to
Montana
    Equipment Ltd. v. Robert B. Somerville Co.
, 2017 ONSC 3092, 67 M.P.L.R.
    (5th) 163, where the court concluded that claims for damage caused by traffic
    vibrations subsequent to the construction of Highway 7 in Vaughan related to
    the use, and not the construction, of the work. According to the OMB, [t]he
    same [was] clearly true of the Beniuks claim, which relates to vibrations
    caused by the continued use of the road in front of their home. The OMB
    concluded that the appellants claim did not meet the definition of injurious
    affection. It stated at para. 25:

The Board finds
that
the Beniuks' claim does not constitute injurious affection for the
    purpose of the [
Expropriations Act
],
    and consequently, that the Board has no jurisdiction over this matter. While the
    Board is sympathetic to what the Beniuks have
endured
over the past decade, the Board is simply not the
    appropriate forum to compensate them for damages. As both counsel noted, there
    are other venues specifically tailored for claims such as these, including a
    procedure concerning highway maintenance contained in the
Municipal
    Act
, 2001
[citing to s. 44]
.

THE MOTION DECISION

[31]

Within days of receiving the OMBs decision, the
    appellants commenced their civil action against the Municipality on January 17,
    2018, claiming damages for nuisance and negligence. The parties agreed that the
    affidavits of documents and the transcripts of examinations for discovery in
    the OMB proceedings would stand for productions and discoveries in the civil
    action.

[32]

The Municipality moved for summary dismissal of
    the action. It asserted that the appellants claim was statute-barred under the
Limitations Act
, that the Municipality was not liable to compensate
    the appellants for nuisance, and that there was no claim in this case under s.
    44 of the
Municipal Act
. The appellants moved for an order dismissing
    the summary judgment motion and seeking judgment in their favour.

[33]

There are three conclusions of the motion judge
    on the limitations issue that are challenged on appeal. First, the motion judge
    held that the basic two-year limitation period under the
Limitations Act
applied.
    The appellants argued that their action was an an action to recover land
    within the meaning of ss. 1 and 4 of the
RPLA
and therefore subject to
    a ten-year limitation period, which had not expired
.
The motion judge
    disagreed, concluding that, although the action may have concerned land or
    may have been related to land, it was not an action to recover land in the
    relevant sense: para. 20.

[34]

Second, the motion judge held that the action
    was statute-barred under the two-year limitation period. The appellants relied
    on s. 5(1)(a)(iv) of the
Limitations Act
to argue that they had not
    discovered their claim until after the OMB decided it had no jurisdiction, because
    it was only then that it was appropriate to commence their civil action. The
    motion judge disagreed, concluding that the appellants knew of the forum issue by
    January 5, 2010, at the latest, when the respondent raised the issue of the
    wrong forum in its Reply to the OMB proceeding. The motion judge also found
    that a reasonable person with the abilities and in the circumstances of the
    appellants ought to have discovered that a civil action was appropriate upon
    receiving the CSI Windsor Report on February 28, 2009: paras. 26 and 27.

[35]

Third, the motion judge held that there was no rolling
    limitation period on these facts. The appellants argued that a new cause of
    action arose every time a heavy truck passed by their house causing damage to
    the home. The motion judge stated that, for this to be the case, there would
    have to be evidence of additional damage to the Beniuk residence in the two-year
    period before the statement of claim was filed (between January 17, 2016 and January
    17, 2018). He concluded that, even allowing that there was a continuing cause
    of action, there was no evidence of any additional damage in the record: I do
    not find the mere presence of trucks continuing to drive on Mersea Road E., particularly
    following the resurfacing, to be evidence of additional damage sustained within
    the limitation period: para. 23.

[36]

Given his conclusions on the limitations issue,
    the motion judge declined to consider whether the Municipality was liable to
    compensate the appellants for nuisance (the second issue on the motion). He
    concluded that if he was wrong on the application of the
Limitations Act
,
    the evidence relied on by the appellants might be entirely different depending
    on which date and limitation period is accepted as appropriate: para. 28.

[37]

As for the appellants claim under s. 44 of the
Municipal
    Act
, the motion judge concluded that the duty of care under that section is
    owed to users of the road, not to adjoining landowners. As authority, he cited this
    courts decision in
Fordham v. Dutton-Dunwich (Municipality)
, 2014
    ONCA 891, 327 O.A.C. 302, at paras. 28-30. Accordingly, he held that, even if
    there was a breach of a duty to maintain Mersea Road East, the duty was not
    owed to the appellants: para. 32.

ISSUES ON APPEAL

[38]

The broad issue on appeal is whether the
    appellants civil action is statute-barred. This turns on three sub-issues:

1.

Does the ten-year limitation period under s. 4
    of the
RPLA
apply to the appellants civil action?

2.

Is the appellants civil action statute-barred
    under s. 4 of the
Limitations Act
?

3.

Is there any part of the appellants civil
    action that can continue?

[39]

The parties also made brief written submissions
    on whether the duty of care under s. 44 of the
Municipal Act
is owed
    to adjoining landowners in the appellants circumstances. Although I will provide
    some brief comments, because of the limited record and sparse submissions on
    this issue, I consider it inappropriate to determine the issue definitively in
    this appeal. Rather, it is appropriate to leave open for determination at trial
    or otherwise in the course of the proceedings, and on a proper record, whether
    the appellants have a claim under s. 44 of the
Municipal Act
in this
    case.

[40]

The balance of these reasons will address each
    issue in turn.

ANALYSIS

Issue 1: Does the ten-year limitation period under s. 4 of the
RPLA
apply to the appellants civil action?

[41]

The motion judges conclusion that s. 4 of the
RPLA
does not apply to the appellants civil action is reviewable on a standard of
    correctness:
Housen v. Nikolaisen
, 2002 SCC 33, [2002] 2 S.C.R. 235,
    at para. 8. For the reasons that follow, I agree with the motion judges
    conclusion on this issue.

[42]

Subsection 2(1)(a) of the
Limitations Act
provides that the
Limitations Act
does not apply to proceedings to
    which the
RPLA
applies. Section 4 of the
RPLA
provides for a
    ten-year limitation period for an action to recover land:

No person shall
    make an entry or distress, or bring an action to recover any land or rent, but
    within ten years next after the time at which the right to make such entry or
    distress, or to bring such action, first accrued to some person through whom
    the person making or bringing it claims, or if the right did not accrue to any
    person through whom that person claims, then within ten years next after the
    time at which the right to make such entry or distress, or to bring such
    action, first accrued to the person making or bringing it.

[43]

When the elements that do not apply to this case
    are removed, s. 4 provides that no person shall bring an action to recover any
    land, but within ten years after the time at which the right to bring any such
    action first accrued to the person bringing it. The issue here is whether the
    appellants claim is an action to recover land within the meaning of the
RPLA
.

[44]

The appellants point to the definition of land
    in s. 1 of the
RPLA
:

land includes
messuages
and all other hereditaments, whether corporeal or incorporeal, chattels and
    other personal property transmissible to heirs, money to be laid out in the
    purchase of land, and any share of the same hereditaments and properties or any
    of them, any estate of inheritance, or estate for any life or lives, or other
    estate transmissible to heirs,
any
possibility,
right
or title
of
entry or
action
, and any other interest capable of being inherited,
    whether the same estates, possibilities, rights, titles and interest or any of
    them, are in possession, reversion, remainder or contingency; [Emphasis added.]

[45]

They rely on the term messuages, which refers
    to a dwelling house, its outbuildings, the area immediately surrounding the
    dwelling, and the adjacent land appropriate to its use:
McConnell v.
    Huxtable
, 2014 ONCA 86, 118 O.R. (3d) 561, at para. 14. The appellants
    also parse out and rely on the phrase anyrightofaction. Putting these
    pieces together, the appellants submit that an action to recover land
    includes an action to recover rights that run with the land, and that a cause
    of action for nuisance is tied to and arises out of the right to use and enjoy
    land without substantial interference. Accordingly, the appellants submit that a
    cause of action for nuisance is an incorporeal or intangible right that runs
    with the property and is captured by the definition of land in the
RPLA
.
    They point to a passage in
Equitable Trust Co. v. 2062277 Ontario Inc.
,
    2012 ONCA 235, 109 O.R. (3d) 561, where Perell J. (sitting on this court
ad
    hoc
) stated that the
RPLA
is intended to cover actions
    affecting land:
Equitable Trust
, at para. 28.

[46]

I do not accept the appellants submission. There
    is no support in the jurisprudence that an action in nuisance or negligence for
    damages relating to real property is an action to recover land for the
    purposes of the
RPLA
. That land or real property is involved in an
    action does not mean that the
RPLA
applies:
Harvey v. Talon
    International Inc.
, 2017 ONCA 267, 137 O.R. (3d) 184, at paras. 51-52. Typically,
    actions to recover land seek to assert property rights. And Perell J.s remark
    from
Equitable Trust
that the
RPLA
covers actions affecting
    land has been commented on specifically by this court, and later by Perell J.
    himself, as a statement that should be interpreted narrowly and not out of the context
    of that case.

[47]

In
Equitable Trust
,
the plaintiff provided a mortgage loan
    to a corporate borrower in February 2005. The defendants personally guaranteed
    the loan. After default, the plaintiff issued a notice of sale under mortgage
    (in December 2007), and after the property was sold, sued the guarantors and
    others for the deficiency. The defendants moved for summary dismissal of the action,
    arguing that it was statute-barred under the
Limitations Act.
The
    plaintiff relied on s. 43(1) of the
RPLA,
which, among other things,
    provides for a ten-year limitation period for an action upon a covenant
    contained in an indenture of mortgage. The defendants argued that s. 43(1) did
    not apply because a covenant can only be given by a party to the mortgage. They
    asserted that a two-year limitation period applies to claims on guarantees.
    Perell J., writing for this court, disagreed and held that s. 43(1) of the
RPLA
applied. He explained, at paras. 28 and 30, that the
RPLA
applied
    because:

[a] guarantee given in conjunction with a
    mortgage transaction affects real property law rights. Guarantors, if they have
    made payments toward the mortgage debt, need to be served in mortgage
    enforcement proceedings because they have an equity of redemption and an
    interest in the mortgaged property



It is true that it
    may not always be easy to determine whether a particular guarantee, like the
    guarantee in [
Bank of Nova Scotia v. Williamson
, 2009 ONCA 754 97
    O.R. (3d) 561] is subject to the
Limitations Act, 2002
or,
    like the guarantee in the case at bar, is subject to the
Real Property
    Limitations Act
. However, it does not follow that that all guarantees
    should be treated the same way. It has been the case historically that
    guarantees associated with land transactions have different limitation periods
    from guarantees associated with contract claims. Moreover, as already noted,
it
    is my view that the Legislature intended that all limitation periods affecting
    land be governed by the
Real Property Limitations Act.
[Emphasis added.]

[48]

Perell J.s comment that the
RPLA
applies to all limitation periods affecting land was thus only a response to
    the defendants argument that the
Limitations Act
applies to all
    claims relating to guarantees. This explains and places in context his
    observation that it would cause much more confusion and uncertainty in the
    law, if the limitation period for enforcing the mortgage debt was different
    from the limitation period for enforcing guarantees of that debt:
Equitable
    Trust
, at para. 31. Moreover, Perell J. was clearly not interpreting the
    phrase action to recover land in s. 4 of the
RPLA
, but rather
    covenant contained in an indenture of mortgage in s. 43(1). The appellants
    reliance on
Equitable Trust
is therefore misplaced.

[49]

Subsequent case law interprets Perell J.s
    comment from
Equitable Trust
narrowly. In
Zabanah v. Capital
    Direct Lending Corp.
, 2014 ONSC 2219, 33 C.C.L.I. (5th) 14, affd 2014
    ONCA 872, 123 O.R. (3d) 350, leave to appeal refused: 2015 CarswellOnt 7052
    (S.C.C.), the defendant was a mortgage broker who had sold the plaintiff a
    mortgage that had been fraudulently obtained. The defendant asserted a
    limitation period defence to the plaintiffs action for negligence, breach of
    contract, and breach of fiduciary duty. On the defendants summary judgment
    motion, the action was dismissed as statute-barred, with the court rejecting
    the plaintiffs claim that the ten-year limitation period under the
RPLA
applied.
    The court concluded that the plaintiffs claim for damages against the mortgage
    broker was not upon a covenant contained in an indenture of mortgage and was
    not a claim affecting land.

[50]

On appeal, this court highlighted, at para. 18, that
    a negligence claim involving real property is different from a claim to an
    interest in land:

We agree with the
    motion judges qualification regarding s. 43 of the
RPLA
, that [t]o the extent that
    language could be read as encompassing every action in which a mortgage or
    piece of real estate is in any way involved, I do not believe that it
    accurately describes the present state of the law. The motion judges
    statement at the end of para. 46 is unassailable, and makes all the difference:
    Nothing that this court decides will affect any partys relationship to the
    second mortgage or the property.
The appellants action, as against [the
    broker], is simply
a negligence
and contract claim, and is not a claim to an interest in land
, as in [
Equitable Trust
]. [Emphasis added.]

[51]

See also
Metropolitan Toronto Condominium
    Corp. No. 1067 v. L. Chung Development Co.
, 2012 ONCA 845, at para. 7,
    where this court again emphasized that actions for damages are not encompassed
    by the
RPLA
;
Toronto Standard Condominium Corp. No. 1487 v. Market
    Lofts Inc.
, 2015 ONSC 1067, 53 R.P.R. (5th) 67, at paras. 53-54, where Perell
    J. clarified, after citing his previous decision in
Equitable Trust
,
    that the incidental involvement of land or real property in an action does not
    mean that the
RPLA
applies;
Conde v. Ripley
, 2015 ONSC 3342,
    57 R.P.R. (5th) 146, at paras. 41-44, and
Stravino v. Buttinelli
, 2015
    ONSC 1768, 53 R.P.R. (5th) 275, at paras. 63-66, both of which considered
    whether an action under s. 2 of the
Fraudulent Conveyances Act
, R.S.O.
    1990, c. F-29 counted as an action to recover land under s. 4 of the
RPLA
and reiterated that actions to recover land generally seek a property
    interest and involve property rights;
Harvey
, at para. 51, where this
    court considered the meaning of money to be laid out in the purchase of land
    and, in the course of doing so, emphasized the difference between claims for
    damages and claims covered by the
RPLA
; and finally,
McConnell
,
    where this court held that a constructive trust claim, based in unjust
    enrichment, was an action to recover land under s. 4 of the
RPLA
because
    it was a claim for a share in property.

[52]

Accordingly, I conclude that s. 4 of the
RPLA
does not apply to the appellants civil action. The weight of authority is
    that an action in nuisance or negligence for damages, whether relating to real
    property or not, does not fit within the scope of s. 4. The motion judge did
    not err in concluding that the basic two-year limitation period under the
Limitations
    Act
applied.

Issue 2: Is the appellants civil action statute-barred under s. 4
    of the
Limitations Act
?

[53]

The question of whether a limitation period
    expired prior to the issuance of a statement of claim is a question of mixed
    fact and law and subject to review on the standard of palpable and overriding
    error:
Longo v. MacLaren Art Centre Inc.
, 2014 ONCA 526, 323 O.A.C.
    246, at para. 38. However, where there is an extricable error of principle, the
    standard of review is correctness:
Housen
, at paras. 8 and 36.

[54]

I agree with the motion judge that it was not
    legally appropriate under s. 5(1)(a)(iv) for the appellants to wait until
    after the OMBs decision to commence civil proceedings. I am not persuaded that
    the motion judge erred in principle in his interpretation and application of s.
    5(1)(a)(iv), or that his conclusion, based as it was on the evidence before
    him, reveals any palpable and overriding error.

[55]

The two-year limitation period and the principle
    of discoverability are codified in ss. 4 and 5 of the
Limitations Act
:

4
. Unless this Act provides otherwise, a proceeding shall not be
    commenced in respect of a claim after the second anniversary of the day on
    which the claim was discovered.

5. (1) A
    claim is discovered on the earlier of,

(a) the day
    on which the person with the claim first knew,

(i) that the injury, loss or damage had occurred,

(
ii) that
    the injury, loss or damage was caused by  or contributed to by an act or
    omission,

(iii) that the act or omission was that of the person against whom
    the claim is made, and

(iv) that, having regard to the nature of the injury,  loss or damage,
    a proceeding would be an   appropriate means to seek to remedy it; and

(b) the day
    on which a reasonable person with the abilities and in the circumstances of the
    person with the claim first ought to have known of the matters referred to in
    clause (a).

[56]

The basic two-year limitation period begins to
    run on the day the claim was discovered. The date of discovery is the earlier
    of the two dates under s. 5(1) - when (a) the person with the claim had
    knowledge of, or (b) a reasonable person with the abilities and in the
    circumstances of the person with the claim first ought to have had knowledge
    of, the matters referred to in ss. 5(1)(a)(i) to (iv). If either of these dates
    is more than two years before the claim was issued, the claim is
    statute-barred:
Fennell v. Deol
, 2016 ONCA 249, 97 M.V.R. (6th) 1, at
    para. 20.

[57]

The appellants submission that the limitation
    period was tolled while they pursued the OMB proceedings hinges on s.
    5(1)(a)(iv). They say that they did not know, and a reasonable person in their
    circumstances would not have known, that it was legally appropriate to start
    a civil claim in the Superior Court until after they received the OMBs ruling
    with respect to jurisdiction. The appellants rely on the alternative process argument
    from
407 ETR Concession Co. v. Day
, 2016 ONCA 709, 133 O.R. (3d) 762,
    leave to appeal refused: 2017 CarswellOnt 6258 (S.C.C.), where this court concluded
    that a proceeding may not be appropriate under s. 5(1)(a)(iv) where the
    party with the claim is pursuing another resolution process that would
    eliminate the loss and thereby avoid needless litigation. The appellants submit
    that, if they had been successful in their claim for injurious affection, the
    OMB proceeding would have obviated the need to bring a civil proceeding. The
    civil action was not legally appropriate before the OMB proceeding concluded.

The
407 ETR
Case

[58]

I begin by noting that
407 ETR
is not
    authority, as the appellants contend, that a civil action is never an
    appropriate proceeding until after an alternative process has run its course. In
    that case, 407 ETR followed a statutory process that provided a mechanism to
    refuse defaulting customers the ability to renew their license plates until all
    tolls, fees, and interest had been paid in full. 407 ETR commenced a civil
    action against a customer for unpaid tolls, after the statutory process did not
    recover the debt that 407 ETR was owed. When the customer raised a limitations
    defence, 407 ETR invoked s. 5(1)(a)(iv) of the
Limitations Act
, arguing
    that it did not know, and could not reasonably have known, that a civil action was
    appropriate until after the internal administrative process had run its course.
    This court agreed. Laskin J.A. explained, at paras. 39-40:

A civil action
    only becomes appropriate when 407 ETR has reason to believe it will not
    otherwise be paid - in other words, when the usually effective licence plate
    denial process has run its course. Thus, the date when a vehicle permit expires
    for the failure to pay a toll debt is the date a civil action is an appropriate
    means to recover that debt

[U]
nder s. 5(1)(
a
)(iv) of the [
Limitations
    Act
] the date a
    proceeding would be an appropriate means to recover a loss must have regard to
    the nature of the . . . loss. So, in fixing the appropriate date, it may not
    be enough that the loss exists and the claim is actionable.
If the claim is the kind of claim that can be remedied by another
    and more effective method provided for in the statute, then a civil action will
    not be appropriate until that other method has been used. Here, a claim will
    not be appropriate until 407 ETR has used that other method, without success.

[59]

Laskin J.A. then referred to the evidence that
    the administrative process provided in the statute was typically very
    effective. He also pointed to s. 5(1)(b), which requires the court to take into
    account the circumstances of the person with the claim. He concluded, at
    para. 45, that 407 ETRs circumstances, requiring the processing of an enormous
    number of transactions without the ability to bar defaulting debtors from using
    the highway, suggested that requiring it to sue before finding out whether
    license plate denial had achieved its purpose would be inappropriate:
407
    ETR
, at para. 45. A third consideration was the need to deter needless
    litigation:
407 ETR
, at para. 48.

[60]

407 ETR
does
    not stand for a general principle that a limitation period will not begin to
    run whenever an alternative process that might resolve the matter has not yet
    run its course. It is a matter of evidence. Indeed, Laskin J.A. noted, at para.
    34, that when an action is appropriate will depend on the specific factual or
    statutory setting of each individual case, and that case law applying s.
    5(1)(a)(iv) is of limited assistance because each case will turn on its own
    facts. In
407 ETR,
the court considered the evidence on the motion
    about the statutory scheme and the effectiveness of the administrative process
    before deciding that it would be reasonable for such a process to run its
    course before a civil proceeding was appropriate.

[61]

Recently, several cases considering the
    application of s. 5(1)(a)(iv) have come before this court. The court has emphasized,
    echoing the words of Laskin J.A. in
407 ETR
, that when a proceeding is
    appropriate will turn on the facts of each case: see, for example,
Nelson
    v. Lavoie
, 2019 ONCA 431, 47 C.C.P.B. (2d) 1, at para. 25, and
Ridel
    v. Goldberg,
2019 ONCA 636, 436 D.L.R. (4th) 453, at para. 71.

[62]

This case did not involve an alternative process
    available under a statutory scheme. It did, however, involve an alternative
    process that the appellants were pursuing, as in
407 ETR
,

against
    the same party.

[63]

The fact that a plaintiff chooses to pursue an
    alternative process does not in itself suspend the running of the limitation
    period under s. 5(1)(a)(iv). Whether an alternative process will have this
    effect will depend on the particular factual circumstances and the evidence
    before the court in determining the limitations issue. In this case, there was
    no evidence to explain why the appellants chose to pursue the OMB route rather
    than commencing both an OMB proceeding and a civil action.

[64]

In
Har Jo Management Services Canada Ltd. v.
    York (Regional Municipality)
, 2018 ONCA 469, 76 M.P.L.R. (5th) 1, the
    appellant made a claim against the respondent municipality after its property
    was damaged by flooding following two significant rainfalls in May 2013. The
    floodwaters came from adjacent lands that the municipality had expropriated in
    2009 for a construction project. There were pending proceedings before the OMB,
    commenced by the appellant in 2013, claiming damages for injurious affection in
    respect of the expropriation. Following the flooding, the appellants lawyer
    wrote a claim letter stating that the respondents construction activities
    caused flooding and damage to the appellants property, and indicating that the
    source of the flooding had to be determined immediately. In its response of
    June 28, 2013, the respondent advised that the flooding was caused not by its
    construction activities, but by a blocked catch basin on the appellants
    property that needed to be flushed.

[65]

The appellant commenced a civil action two years
    after the receipt of the June 28, 2013 letter. The respondent was successful in
    its motion for summary dismissal on the basis that the claim was discoverable
    when the flooding occurred in May 2013, and the limitation period had expired.

[66]

On appeal to this court, the appellant argued
    that the action was not discoverable until receipt of the June 28, 2013 letter
    because it did not know the cause of the flooding or the respondents position
    with respect to the cause of the flooding until that date. If the respondent
    had conceded that the flooding was caused by the construction, the claim could
    have been included as part of the appellants existing claim for injurious
    affection; if, on the other hand, the respondent offered another theory on the
    cause of the flooding, a civil action for nuisance or negligence would be
    necessary.

[67]

This court agreed with the appellant. Feldman
    J.A. noted that the first time there was a suggestion that the flooding might
    have been caused by something other than the construction activities (which
    would have fallen within the existing injurious affection claim) was in the
    June 28, 2013 letter. It was only on that date that the appellant knew or ought
    to have known, under s. 5(1)(a)(iv), that a court proceeding, and not a
    proceeding before the OMB, would be an appropriate means to seek to remedy its
    loss.

[68]

In
Har Jo,
the appellant had also
    argued in the alternative that the limitation period for the flooding claim did
    not begin to run until after the OMB had determined its jurisdiction. The court
    in
Har Jo
did not have to determine this issue, but Feldman J.A.
    stated in
obiter
at para. 44:

Case law suggests
    that in circumstances similar to those in this case, plaintiffs have often
    commenced two proceedings, one before the OMB and one in the Superior Court.
    Defendants may then seek a stay of the court proceeding pending a determination
    of jurisdiction by the OMB, or even dismissal of the court claim if it is
    clearly a claim for injurious affection: see e.g.
Montana Equipment Ltd. v.
    Robert B. Somerville Co.
, 2017 ONSC 3092 (Ont. S.C.J.);
Great Land
    (Westwood) Inc. v. York (Regional Municipality)
, 2016 ONSC 5975, 3 L.C.R.
    (2d) 1 (Ont. S.C.J.); and
Curactive Organic Skin Care Ltd. v. Ontario
,
    2011 ONSC 2041, 102 L.C.R. 238 (Ont. S.C.J.), affd 2012 ONCA 81, 105 L.C.R. 26
    (Ont. C.A.).

Application to the Appellants Circumstances

[69]

In the present case, counsel presumably thought
    that the appellants claim was a case for injurious affection and therefore
    pursued it before the OMB. However, the appellants were on notice that the Municipality
    challenged the jurisdiction of the OMB to determine their claim when, on
    January 5, 2010, they received the Municipalitys Reply pleading that this was
    not a claim for injurious affection. The Municipality pleaded:

4. The Respondent states that the Ontario
    Municipal Board has no jurisdiction or authority to adjudicate the Claimants
    request for Arbitration for its claim for compensation with respect to the land
    and business set out in the Notice of Arbitration and Statement of Claim.

5. The Respondent states that the Ontario
    Municipal Board is not the proper forum or venue to determine this dispute and
    the Claimants request for Arbitration.



14. The Respondent denies that the Claimants
    have suffered injurious affection to their property that was caused or created
    by the Respondent and as such the Respondent denies that the
Expropriations Act
applies to the facts
    as pleaded in the Statement of Claim.



17. The Respondent
    denies that the Claimants suffered any injurious affection to property caused
    by the construction of the roadway of Concession E [Mersea Road East].

[70]

While I can appreciate why the appellants may
    have thought they had a claim for injurious affection, it has always been a
    principle of limitations law that a plaintiff knows, or could by the exercise
    of reasonable diligence, determine what legal principles apply. See, for
    example,
Boyce v. Toronto Police Services Board
, 2011 ONSC 53, affd:
    2012 ONCA 230, leave to appeal refused: [2012] S.C.C.A. No. 265, where Low J.
    stated, at para. 23:

Section 5(1)(a)(iv)
    does not import an idiosyncratic limitation period calibrated by the claimants
    familiarity with or ignorance of the law. The test is an objective one. While
    it is possible to envisage that a new kind of right might arise that has not
    been hitherto protected, thus making it arguable that a civil proceeding might
    not be seen objectively as an appropriate means to seek to remedy, a battery
    causing personal injury is a classic example of the kind of wrong that is
    appropriate for redress by court action.
A citizen is presumed to know the
    law of the land
. [Emphasis added.]

[71]

See also
Novak v. St. Demetrius (Ukrainian
    Catholic) Development Corporation
, 2017 ONSC 3503, at para. 27, where
    Diamond J. noted that [t]he provisions of the [
Limitations Act
] do not
    mention, directly or indirectly, a plaintiffs decision to commence a
    proceeding in the wrong forum as having the effect of preserving or tolling a
    limitation period. In
Novak
, the plaintiff had failed to adduce
    evidence in support of her obligation to rebut the statutory presumption that
    she knew or ought to have known a legal proceeding was the appropriate means to
    remedy her loss or damage.

[72]

In this case, not only would the appellants be
    presumed to know that there might be a forum issue, they were specifically put
    on notice of the fact. While the evidence on the motion addressed the merits of
    the appellants claims, there was no explanation of why the appellants had
    concluded, before they received the OMB decision, that their claim was only a
    claim for injurious affection (notwithstanding that they had been put on
    notice of the jurisdiction issue in the respondents Reply), or why they had
    not adopted the approach referred to in
Har Jo
of commencing a court
    action at the same time, if there was any doubt.

[73]

Rather, the appellants position in the court
    below, as on appeal, was that while they pursued the OMB proceeding, which, if
    successful, would have disposed of its claims, then as a matter of principle, a
    civil action was not legally appropriate under s. 5(1)(a)(iv) until such proceeding
    had run its course.

[74]

As I have already observed,
407 ETR
does
    not stand for the general principle that it will always be appropriate to wait
    until another process has run its course before commencing a civil action in
    respect of a claim which has otherwise been discovered under s. 5(1)(a)(i),
    (ii) and (iii). It is incumbent on a party asserting that it was reasonable to
    pursue a claim in another forum to explain why this approach was reasonable.
    That is what occurred, and was ultimately successful, in the
407 ETR
case.

[75]

While one of the principles recognized in
    connection with s. 5(1)(a)(iv) is the deterrence of unnecessary litigation, a
    plaintiff is not entitled in all cases to pursue one route, and to expect the
    limitation period to be tolled in respect of any other claim it may have in
    respect of its loss or damage. Said another way, s. 5(1)(a)(iv) does not permit
    a party to engage in litigation in stages for the same wrong. An example is
Lilydale
    Cooperative Limited v. Meyn Canada Inc.
, 2019 ONCA 761, 439 D.L.R. (4th)
    385, where this court considered the submission that a limitation period in
    respect of a third party claim in Ontario was suspended while the defendant was
    seeking to establish that Alberta was the correct forum for the litigation.
    Feldman J.A. rejected the argument that it was not legally appropriate to
    commence a legal proceeding while another resolution process that might resolve
    the matter was ongoing. She held that such an interpretation of appropriate
    was inconsistent with the purpose of the
Limitations Act
and could
    extend the limitation period well beyond the two-year threshold in an uncertain
    and unpredictable manner. There were also no significant savings to be achieved
    by not commencing the third party claim until the forum challenge was complete.

[76]

At para. 26 of his reasons, the motion judge
    indicated that he agreed with the Municipalitys submission that the law does
    not provide for postponing or suspending the limitation period simply because a
    plaintiff brought its claim in the wrong forum. He found that the appellants
    counsel knew of the forum issue by January 5, 2010, at the latest, when the
    Municipality raised the issue in its Reply to the OMB proceeding. At para. 27,
    however, the motion judge concluded that a reasonable person with the abilities
    and in the circumstances of the appellants ought to have discovered the claim
    on February 28, 2009, upon receipt of the expert report suggesting damage to
    the property was connected to the traffic on the nearby roadway.

[77]

In light of his conclusion at para. 26, and
    taking into consideration s. 5(1)(a)(iv), the motion judge ought to have
    concluded that the appellants discovered their claim on January 5, 2010, when
    they were put on notice of the forum issue. However, that would not have saved
    the claim from the limitations defence. The action was commenced only in
    January 2018, well outside of the two-year period limitation period.

[78]

Accordingly, subject to my conclusion on Issue 3
    below, the appellants civil action is largely statute-barred.

Issue 3: Is there any part of the appellants civil action that can
    continue?

[79]

The appellants contend that the motion judge
    made a palpable and overriding error when he concluded that their claim was
    statute-barred even on the basis of what he described as a rolling limitation
    period. A palpable and overriding error is an obvious error that is
    sufficiently significant to vitiate the challenged finding of fact:
Longo
,
    at para. 39.

[80]

In order to obtain a summary dismissal of the
    action, the Municipality was required to establish that there was no genuine
    issue requiring a trial for its limitations defence. The appellants submitted
    that a fresh cause of action accrued each time vibrations from traffic caused
    damage to their property, and that, if this were true, they should be able to recover
    in respect of damage sustained within the two-year period before the issuance
    of the statement of claim (January 17, 2016January 17, 2018). The specific
    issue that was put to the motion judge on this point was whether there was
    evidence of ongoing tortious conduct causing damage between January 17, 2016
    and January 17, 2018.

[81]

The motion judge addressed the issue at para. 23
    of his reasons:

The [Beniuks]
    counsel submit that the vibrations on the property continue to this day.
    However, in June of 2013, the evidence is that the existing gravel road base
    was pulverized and a new granular road base and new tar and chip surface was
    put down. Even allowing that there was a continuing cause of action, damages
    would only be recoverable for the part of the loss arisen in the two year
    period before the plaintiffs filed their statement of claim.
I do not find
    the mere presence of trucks continuing to drive on Mersea Road E., particularly
    following the resurfacing, to be evidence of additional damage sustained within
    the limitation period. A party claiming a continuing nuisance in the face of a
    limitation defence must have evidence of damage sustained within the limitation
    period.
[Emphasis added.]

[82]

While the motion judge accepted that there was
    evidence of trucks continuing to drive on Mersea Road East, what was missing in
    his view was evidence of damage sustained within the limitation period. There
    was, however, evidence of continuing damage in the record before the motion
    judge. The Lecce Report, which was prepared for the appellants, suggested that
    they were sustaining additional damage on a regular basis at least until
    December 1, 2016 (the date of the report). The report concluded, among other
    things, that:

Some of the same sources that initially
    contributed to the reported stream of
Mechanical Damages
are
still
    ongoing
, and therefore preclude the possibility of a stable environment
    within which to mitigate the losses, and repair the Beniuk residence;



Similarly, the
    consequences that were associated with the suite of
Mechanical Damages
that were sustained by the Beniuk residence (between 2006 and 2009) and then
    re-introduced again (between 2009 and 2010), have not abated (
because the
    source of the physical disruptions has continued to persist
). [Emphasis
    added.]

[83]

According to the Lecce Report, the work done by
    the Municipality had not fully abated the ongoing issue of vibrations, and more
    importantly, there was ongoing damage to the Beniuk residence. Although the
    Municipality relied on a competing report of its own expert, Mr. McCloskey, who
    suggested that after the 2013 repair of the road, vibrations from heavy truck
    traffic would have been minimal, this was not the basis for the motion judges
    conclusion. Again, he said that even allowing that there was a continuing
    cause of action, damages would only be recoverable for the part of the loss
    arisen in the two year period before the plaintiffs filed their statement of
    claim and that he did not find the mere presence of trucks continuing to
    drive on Mersea Road E., particularly following the resurfacing to be evidence
    of additional damage sustained within the limitation period. The appellants
    relied on more than the mere presence of trucksthe Lecce Report provided
    evidence of continuing problems and damage to the Beniuk residence.

[84]

Counsel for the respondent fairly accepted in
    oral submissions that this was a strong ground of appeal, but requested that
    this court give clear direction that the appellants will only be able to recover
    in respect of damages sustained after January 17, 2016.

[85]

Given the above conclusions that the
RPLA
does not apply, and that it was
    not legally appropriate to wait until after the OMBs decision to start a civil
    action, I am willing to give clear direction to this effect. The issue of
    whether the Municipality engaged in wrongful conduct resulting in damage within
    two years before the statement of claim was issued is a genuine issue requiring
    trial. In the event that the appellants are successful in their argument, they
    can only recover in respect of damages sustained after January 17, 2016.

Issue 4: The duty of care issue under s. 44 of the
Municipal Act

[86]

The final issue is whether the duty of care
    under s. 44 of the
Municipal Act
is owed to adjoining landowners in
    the appellants circumstances. As noted above, this is a novel issue that has
    not been decided by this court. On appeal, it was not the focus of the parties
    submissions and there was no engagement with the relevant jurisprudence. In
    these circumstances, I would decline to decide this novel issue definitively,
    but would provide the following brief remarks.

[87]

Section 44 of the
Municipal Act
provides
    for a statutory duty of a municipality with respect to road maintenance. Subsections
    44(1) and 44(2) provide a cause of action against the municipality, while
    subsection 44(3) sets out three defences:

44 (1) The municipality that has jurisdiction
    over a highway or bridge shall keep it in a state of repair that is reasonable
    in the circumstances, including the character and location of the highway or
    bridge.

(2) A municipality that defaults in complying
    with subsection (1) is, subject to the
Negligence Act
, liable for all
    damages
any person
sustains because of the default.

(3) Despite subsection (2), a municipality is
    not liable for failing to keep a highway or bridge in a reasonable state of
    repair if,

(a) it did not know and could not
    reasonably have been expected to have known about the state of repair of the
    highway or bridge;

(b) it took reasonable steps to prevent the
    default from arising; or

(c) at the time the cause of action arose,
    minimum standards established under subsection (4) applied to the highway or
    bridge and to the alleged default and those standards have been met.

(4) The Minister
    of Transportation may make regulations establishing minimum standards of repair
    for highways and bridges or any class of them. [Emphasis added.]

[88]

The appellants rely on the plain wording of s.
    44(2) to argue that the statutory duty under s. 44 is owed to them as adjoining
    landowners. Subsection 44(2) contemplates that any person who sustains damage
    because of a municipalitys failure to comply with subsection (1) can bring an
    action. The motion judge did not engage with the plain wording of s. 44(2) and
    instead relied on this courts decision in
Fordham
to conclude that
    the statutory duty of care set out in s. 44(1)is not directed to injuries
    suffered by adjoining landowners: para. 32. According to the motion judge, [t]he
    jurisprudence and duty of care has been established with respect to the
    travelling public and as measured against the ordinary reasonable driver:
    para. 32.

[89]

The motion judges reliance on
Fordham
was
    misplaced.
Fordham
involved a claim by a young man who was seriously
    injured while driving at night on a road that was alleged to have been unsafe. The
    concept of the ordinary reasonable driver was a statement of the standard of
    care owed to the plaintiff, who was alleged to have been driving in a dangerous
    manner. It was not a determination of whether the s. 44 duty was owed to
    persons other than the user of the road. In allowing the appeal, Laskin J.A.
    described the standard of care as requiring a municipality to keep its roads,
    city or rural,  safe for reasonable drivers, not negligent ones:
Fordham
,
    at para. 49.

[90]

This formulation of the standard of care can be
    traced back to the Supreme Court of Canadas decision in
Housen
(better
    known for its discussion of appellate review). In
Housen
, the court
    adopted the following statement of a municipalitys standard of care for road
    maintenance from
Partridge v. Rural Municipality of Langenburg
, [1929]
    3 W.W.R. 555 (Sask. C.A.), per Martin J.A., at pp. 558-59:

The extent of the
    statutory obligation placed upon municipal corporations to keep in repair the
    highways under their jurisdiction, has been variously stated in numerous
    reported cases. There is, however, a general rule which may be gathered from
    the decisions, and that is, that
the road must be kept in such a reasonable
    state of repair that those requiring to use it may, exercising ordinary care,
    travel upon it with safety
.

[91]

The standard of care from
Partridge
, adopted in
Housen
and followed in
Fordham
, appears, on its face, to
    subsume the duty of care question. However, it is trite that the standard of
    care and duty of care are conceptually distinct and should not be conflated. To
    specify that the standard of care must be measured against the behaviour of a
    certain class of persons, as this court did in
Fordham
, is not the same as saying that the duty of care is only owed to
    that class of persons. Moreover, the facts of
Fordham
turned on the
    standard of care. Duty of care was not at issue in the case, nor was it an
    issue in
Housen
.

[92]

There is old authority on the issue of who is
    owed the municipalitys duty of road maintenance. In
Dick v. Vaughan
    (Township)
(1917), 39 O.L.R. 187 (C.A.), this court considered a
    predecessor provision, which was substantially similar to s. 44 of the 2001
Municipal
    Act.
The respondent had claimed damages for the economic loss caused when
    he had to use an alternate route for his business because a bridge was not
    strong enough to support the weight of his traction engine and threshing
    machine. The court stated that the statutory duty of care was owed to the
    travelling public and to no one else (at p. 191) and that it only applies to
    what may be in a general way described as accident cases (at pp. 197-198). The
    court did, however, recognize that in previous cases like
Strang v.
    Township of Arran
(1913)
,
    28 O.L.R. 106 (C.A.) and
Cummings v. Dundas (Town)
(1907)
, 13 O.L.R. 384 (Div. Ct.), leave
    to appeal refused: 1907 CarswellOnt 627 (C.A.), adjoining landowners were owed
    the duty to keep roads in a reasonable state of repair when access to their property
    was at issue. In other words, these were cases where liability under the
    statutory provision was found to extend to persons beyond the users of the
    road. Ultimately, in
Dick,
the court allowed the appeal and dismissed
    the claim on the basis that the loss complained of was not damages sustained
    by the respondent by reason of the default of the appellants, within the
    meaning of the enactment, and that, if it were, the damages were too remote: p. 197.

[93]

Dick
was cited
    as authority that the statutory duty was owed only to users of the roadway in
McPhee
    v. Plympton (Township)
(1987), 61 O.R. (2d) 508 (Dist. Ct.), where
    the court dismissed a claim for damage to an adjoining property resulting from
    drainage of surface water from a roadway. By contrast, in
Schraeder v.
    Township of
Gratton, [1945] O.R. 657 (H.C.), where the claim was by a
    landowner for the failure to complete a road constituted by dedication and
    acceptance,
Dick
was expressly not followed in favour of the
Strang
line of cases.

[94]

In
Ouellette v. Hearst (Town)
(2004),
    70 O.R. (3d) 204 (C.A.), this court considered a case where a utility pole fell
    and struck a vehicle on a roadway. The municipality argued that the negligence
    claim was really a claim under former s. 284(1) of the
Municipal Act
to
    keep the highway in a reasonable state of repair, and subject to a three-month
    limitation period that had expired. The court noted that the label attached to
    the cause of action by the plaintiff was not determinative, and that the court
    would have to determine whether the negligence in question was in fact a breach
    of a duty imposed by the
Municipal Act: Ouellette
,
at para. 22. After noting that the
    jurisprudence respecting the scope of a duty of a municipal corporation to keep
    its highways in repair is extensive and that the scope of the duty has been
    defined in broad terms (paras. 25 and 26), the court concluded that the
    specific factual circumstances did not fit within the ambit of non-repair of a
    highway (at para. 27). Moreover, the court noted at paras. 29 and 30:

Most
of the cited
    cases are fairly old. They were decided at a time when there was little scope
    in the common law for actions against municipalities for keeping their highways
    in a reasonable state of repair. Accordingly, courts tended to interpret the
    duty in s. 284(1) in a broad fashion. As explained by Carthy J.A. in [
Mero v.
    Waterloo (Regional Municipality)
(1992), 70 O.R. (3d) 102 (C.A.)] at p.
    106:

What we see
    historically is that the law in Ontario has developed on the assumption that
    there is no common law liability upon a municipality respecting maintenance of
    highways except for nuisance and, as the natural evolution of what might have
    been termed a very restrictive statutory cause of action in s. 284(1) has
    progressed, the courts have been increasingly liberal in the interpretation of
    what constitutes non-repair of a highway.

There is no longer a need to stretch the
    wording of s. 284(1) to ground what are, in reality, proposed negligence
    actions against municipalities. That is because in
Just v. British Columbia
, [1989]
    2 S.C.R. 1228, 64 D.L.R. (4th) 689, the Supreme Court of Canada held that
    the traditional tort law duty of care could apply to a government agency
    respecting the maintenance of highways where there was no express statutory
    duty imposed. In the wake of
Just
, s. 284(1) need not be interpreted
    to cover a situation that amounts to an extension of the statutory duty to
    repair; rather, an action against a municipality in this context can proceed as
    a negligence action, as pleaded in this case...

[95]

In my view, while there may well be an issue as
    to whether the appellants can rely here on s. 44 of the
Municipal Act
,

the broader issue is whether the
    appellants have a claim in negligence against the respondent in respect of
    their construction of and subsequent conduct in relation to Mersea Road East.
    Although the OMB decision referred to a possible claim by the appellants under
    s. 44 of the
Municipal Act
, and although the appellants pleaded this
    provision in their Statement of Claim in the civil action, it is not clear
    whether their claim for negligence is limited to a claim for breach of the
    statutory duty to repair under s. 44, or whether it extends more broadly.
    Whether their negligence claim is only under s. 44, and whether that section is
    available to them, are matters that should be determined on a full record.

CONCLUSION AND DISPOSITION

[96]

For these reasons, I would allow the appeal in
    part. There is a genuine issue requiring a trial as to whether the appellants
    have a claim in respect of damage sustained within the two years prior to the
    issuance of their statement of claim in the civil action, including under s. 44
    of the
Municipal Act
. If
    the appellants are successful in their action, they will be limited to recovery
    for damages sustained after January 17, 2016.

[97]

To reflect the mixed success on the appeal, I
    would award costs of the appeal to the respondent in the sum of $6,500,
    inclusive of disbursements and HST, and I would reduce the respondents costs
    in the court below to $10,000, inclusive.

Released: March 25, 2020

KMvR

K.
    van Rensburg J.A.

I
    agree David M. Paciocco J.A.

I
    agree J.A. Thorburn J.A.


