Foley v. St. Marys (Town)

Foley v. St. Marys (Town) Collection Decisions of the Court of Appeal Date 2016-07-04 Neutral citation 2016 ONCA 528 Docket numbers C61268 Judges Pepall, Sarah E.; Tulloch, Michael H.; Pardu, Gladys I. Subject Civil Decision Content COURT OF APPEAL FOR ONTARIO CITATION: Foley v. St. Marys (Town), 2016 ONCA 528 DATE: 20160704 DOCKET: C61268 Pepall, Tulloch and Pardu JJ.A. BETWEEN Lynn Foley and Colleen Foley Applicants (Appellants) and The Corporation of the Town of St. Marys Respondent (Respondent) Martha Cook, for the appellants Timothy J. Hill, Eileen P. Costello and Meghan A. Cowan, for the respondent Heard: June 13, 2016 On appeal from the judgment of Justice D.R. Aston of the Superior Court of Justice, dated October 9, 2015. ENDORSEMENT Background [1] This appeal concerns a municipal heritage designation of a landmark commercial property located in the downtown core of St. Marys, Ontario. [2] In 1884, a two-storey brick and stone commercial building with a clock tower was constructed at 135 Queen Street East in St. Marys for a local jeweller. For over a century, the building was home to the family jewellery shop. In keeping with its purpose, the shop’s interior contained walnut showcases, counters, mirrors and a tall wall clock. These interior features are stated to be original and some are referenced in an 1884 St. Marys newspaper article. [3] In 2004, the appellants, Lynn Foley and Colleen Foley, purchased the property from the family jewellers and leased it until 2010. [4] In the fall of 2007, the respondent, the Corporation of the Town of St. Marys (the “Town”), wrote to the appellants to introduce the possibility of a heritage designation. The Town subsequently contacted them to ask whether they had an interest in having the property designated as a heritage building, as it was unique and historic. The Town representative spoke about the heritage designation possibility with Mr. Foley, who advised that he was not interested in participating in the process. The Town later advised that they planned to proceed without the appellants’ support. [5] By letter dated January 4, 2008, the Town attempted to provide formal written notice to the appellants of its intention to pass a bylaw designating the building as a heritage building. Although the street address was correct, the last number in the appellants’ postal code was not (the correct number was 9 instead of 7). Despite the fact that the notice was not returned to the Town, the appellants say that they never received it. [6] The appellants did admit to seeing the Town’s notice of intent to designate that was published in the newspaper in accordance with the provisions of the Ontario Heritage Act, R.S.O. 1990, c. O. 18 (the “OHA”). The Town did not receive any objections to the designation. [7] On February 27, 2008, the Town passed bylaw No. 14-2008, which designated the appellants’ property a heritage building. The designation included the original exterior and interior heritage attributes. The latter consisted of the walnut showcases, counters, mirrors and the wall clock. The Town wrote to the appellants on March 5, 2008 advising them of the designation. The designation was also reported in the local newspaper, on March 8, 2008. [8] In August 2009, the appellants successfully applied for, and received, municipal heritage funding from the Town based on the heritage designation. In their application, the appellants noted that the property was the one building in St. Marys that had “remained virtually unchanged, both inside and out since 1884.” [9] The appellants again successfully applied for additional heritage funding from the Town in October 2009. In total, the appellants received $13,000 from the Town, a significant sum for St. Marys in this regard. [10] On December 2, 2009, the Town registered the heritage designation bylaw on title to the appellants’ property in accordance with the provisions of the OHA. [11] In early 2010, Mr. Foley attended a Town council meeting where he was presented with a designation plaque, which noted the building’s unique original exterior and interior features. [12] While the building’s features were in keeping with its 19th and 20th century purpose as a jewellery store, they proved not to be so popular in June 2010, when the appellants listed the property for sale. The appellants received little interest from their listing and placed the blame on the heritage designation of the interior features. [13] Correspondence ensued between the appellants and the Town. On September 6, 2013, the appellants’ solicitor wrote to the Town complaining that his clients had not received the Town’s correspondence enclosing the original notice of intention to designate and that they were unaware that the Town had intended to designate items of personal property. Notice of Application [14] Ultimately, the appellants commenced court proceedings and issued a notice of application on March 30, 2015. The notice of application was styled as an: “APPLICATION UNDER section 273 (1) of the Municipal Act, 2001, S.O. 2001, c. 25.” [15] The appellants applied for an order quashing the bylaw for illegality and, in the alternative, severing those parts of the bylaw that purported to designate the interior features, fixtures and chattels of the building. They also sought interlocutory injunctive relief and damages for unlawful interference. [16] The notice of application stated that: [P]ursuant to s. 273 (1) of the Municipal Act, 2001, S.O. 2001, c. 25 as amended, this Honourable Court may quash a by-law of a municipality in whole or in part for illegality. [17] In addition to s. 273 of the Municipal Act, 2001, the appellants also relied on s. 101 of the Courts of Justice Act, R.S.O. 1990, c. C.43; rr. 14, 38 and 39 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194; and ss. 26, 29, 32 and 33 of the OHA. Application Judge’s Decision [18] The application judge dismissed the application. Given the error in the postal code, he concluded that the Town could not meet its onus of proving that notice was properly given under s. 67 of the OHA. However, he found that the appellants had actual notice of the notice of designation and failure to strictly comply with s. 67 of the OHA rendered the designating bylaw voidable, and not void ab initio as argued by the appellants. [19] He then held that the one year limitation period in s. 273(5) of the Municipal Act, 2001 was dispositive of the application to quash. He therefore dismissed the application, including the alternative claim to quash the bylaw in part by severing all reference to the interior features from the designation. [20] Having dismissed the application, the application judge stated that during the course of submissions, counsel for both sides requested that he address the scope of the designation. He acceded to the request. He then concluded that the Town’s authority to designate was limited to real property including fixtures, but that the walnut showcase, counters, mirrors, and the wall clock, were fixtures. [21] The appellants argue that the application judge erred in finding that the heritage designation was not void ab initio given the lack of notice and for concluding that the interior features were fixtures, rather than chattels, and that they were therefore real property. Analysis [22] The relevant provisions of the Municipal Act, 2001 are ss. 273(1) and (5). They state: 273(1) Upon the application of any person, the Superior Court of Justice may quash a by-law of a municipality in whole or in part for illegality. (5) An application to quash a by-law in whole or in part, subject to section 415, shall be made within one year after the passing of the by-law. [23] The application judge’s conclusion that the one year limitation period was dispositive of the appellants’ application was fully supported by the record. The bylaw was passed on February 27, 2008 and the notice of application was issued on March 30, 2015. [24] The record clearly established that the appellants had knowledge of the heritage designation. As noted by the application judge, the appellants concede that they were aware of the Town’s intention to designate the property as early as 2007. They were aware of the notice of intention to pass the bylaw that was published in the local newspaper in January 2008. In 2009, they twice applied for, and twice received, municipal heritage funding based on the designation and in February 2010, at a public meeting, they received a designation plaque which referenced both the exterior and interior features of the building. The bylaw was also registered on title in 2009. The application judge found that they were aware of the designating bylaw (and its specifics) no later than August 2009, almost six years before the bringing of the application. [25] The application judge’s conclusion was also fully supported by the law. In reaching his determination, he relied on Re Clements & Toronto, [1960] O.R. 18 (C.A.). That decision dealt with a largely similar predecessor provision of the Municipal Act, 2001 and an application to quash. A lower court had quashed a bylaw on the basis that it was void ab initio. Relying on the limitation period in the Municipal Act, this court overturned the decision due to the failure of the applicant to bring the notice of application within one year after the passing of the bylaw. It did so notwithstanding the finding that the bylaw was void ab initio. [26] The cases relied upon by the appellants differ from the case under appeal. First, Las Vegas Strip Ltd. v. Toronto (City) (1996), 30 O.R. (3d) 286 (Ct. J. (Gen. Div.)), aff’d on other grounds (1997) 32 O.R. (3d) 651, did not involve a request for the statutory remedy of quashing a bylaw under the Municipal Act, but a request for declaratory relief. As Sharpe J. (as he then was) noted, at para. 12, “it is clear on the authorities that s. 138 [s. 273(5)’s predecessor] has no application to a proceeding such as the present for declaratory relief.” Only cases that sought the statutory remedy of quashing the bylaw pursuant to the Municipal Act were caught by the statutory one year limitation. [27] Secondly, Gray v. Oshawa (City), [1971] 3 O.R. 112 (H. Ct. J.), rev’d on other grounds [1972] 2 O.R. 856, an expropriation case, similarly involved a request for declaratory relief. The trial judge noted that the action did not seek to quash the bylaw and therefore the statutory one year limitation period was inapplicable. [28] To summarize, a party may commence proceedings to quash a bylaw under s. 273 of the Municipal Act, 2001 by way of application. Such a proceeding is captured by the statutory one year limitation period. Alternatively, a party may commence an application or an action for declaratory relief. Such a proceeding is distinct from the statutory remedy of quashing a bylaw under s. 273, and as such, is not captured by the one year limitation period. [29] Here, there is no question that this proceeding was framed as an application to quash under s. 273 of the Municipal Act, 2001. Both the title of the proceedings and the enumerated grounds support this conclusion. Accordingly, the one year limitation provision applies. [30] Moreover, this is not simply a technical analysis. On an application, a party need only respond to the case asserted against it. Had declaratory relief been sought, a different strategy may have ensued, including the development of a more detailed record and a request for a trial of the issue. [31] The limitation period contained in s. 273(5) of the Municipal Act, 2001 also disposes of the request to quash the bylaw in part by severing those portions of the bylaw that purport to designate the interior features. [32] The application judge was correct in dismissing the application in full on the basis of the limitation period. There is therefore no need to address his findings on the scope of the designation. Disposition [33] For these reasons, the appeal is dismissed. As agreed, the appellants shall pay the respondent $11,000 in costs, inclusive of disbursements and applicable tax. “S.E. Pepall J.A.” “M. Tulloch J.A.” “G. Pardu J.A.”