Waterstone Properties Corporation v. Caledon (Town)

Waterstone Properties Corporation v. Caledon (Town) Collection Decisions of the Court of Appeal Date 2017-08-01 Neutral citation 2017 ONCA 623 Docket numbers C62685, C62686 Judges Hourigan, C. William; Benotto, Mary Lou; Roberts, Lois B. Subject Civil Decision Content COURT OF APPEAL FOR ONTARIO CITATION: Waterstone Properties Corporation v. Caledon (Town), 2017 ONCA 623 DATE: 20170801 DOCKET: C62685 and C62686 Hourigan, Benotto and Roberts JJ.A. BETWEEN Waterstone Properties Corporation and Wyndcliffe Developments Inc. Applicants (Appellants) and The Corporation of the Town of Caledon Respondent (Respondent on Appeal) and BETWEEN The Corporation of the Town of Caledon Applicant (Respondent on Appeal) and Waterstone Properties Corporation and Wyndcliffe Developments Inc. Respondents (Appellants on Appeal) Milton A. Davis and Ronald D. Davis, for the appellants Signe Leisk and Michael Mahoney, for the respondent Heard: May 24, 2017 On appeal from the orders of Justice Robert F. Goldstein of the Superior Court of Justice, dated August 26, 2016, with reasons reported at 2016 ONSC 5394. Roberts J.A.: A. Overview [1] The appellants appeal from the dismissal of their application and the granting of the respondent’s application for a declaration that the respondent is the beneficial and legal owner of a 2.8-acre park known as the Kingsview Parkette (“the Parkette”), which is located in the Town of Caledon (“the Town”). [2] The appellant, Waterstone Properties Corporation (“Waterstone”), and its predecessors in title are related companies, and held paper title to the Parkette. They are in the business of land development. In 1972 and again in 1973, members of this group of companies entered into subdivision agreements with the Town. Among other terms, the subdivision agreements provided that the Parkette would be deeded to the Town for use as a park. [3] While the Parkette was never formally transferred to or registered on title in the Town’s name, there is no dispute that, since 1974, the Town has had possession of the Parkette and that, since 1977 or 1979, the Town has used and operated the Parkette as a public park. [4] In 1995, the original owner of the Parkette, Sorrento Limited Partnership (“Sorrento”), another related company, demanded that the Town return the Parkette and release any claim that it had to it. Sorrento relied on the re-conveyance provisions under the 1972 subdivision agreement. The Town refused to do so, maintaining that the 1973 subdivision agreement superseded the 1972 subdivision agreement. [5] On March 26, 1999, the Parkette was administratively converted into the Land Titles system in the name of Great Georgian Realty Group (“Great Georgian”) as owner. [6] On May 7, 2013, the Parkette was transferred into the name of the appellant, Waterstone. [7] On September 17, 2014, in an attempt to resolve the matter, the Town offered to purchase the Parkette. The Town subsequently changed its position. On May 8, 2015, the Town asserted outright ownership of the Parkette and demanded a deed for nil consideration. [8] The appellants and the Town then commenced separate applications, each seeking a declaration of ownership of the Parkette. [9] The application judge dismissed the appellants’ application, declared the Town the legal and beneficial owner of the Parkette, and made an order directing the Land Registrar to correct the parcel register to reflect the Town’s ownership, on the following bases: i. the 1973 subdivision agreement superseded the 1972 subdivision agreement with respect to the conveyance of the Parkette; and the inclusion of the conveyance of the Parkette in the 1973 subdivision agreement was not a mistake; ii. the 1973 subdivision agreement created a constructive trust in favour of the Town as beneficial owner of the Parkette; iii. the administrative transfer of the Parkette into the Land Titles system in 1999 did not extinguish the Town’s beneficial ownership of the Parkette; iv. in the alternative, the Town had acquired ownership of the Parkette by application of the doctrines of adverse possession and dedication and acceptance. B. Issues [10] The appellants have raised numerous grounds of appeal. However, for the purpose of disposing of this appeal, it is necessary to consider only the following: 1. Did the application judge err in determining that the 1973 subdivision agreement superseded the 1972 subdivision agreement with respect to the provisions governing the conveyance of the Parkette to the Town, including that the conveyance of the Parkette in the 1973 subdivision agreement was not a mistake? 2. Did the administrative transfer of the Parkette into the Land Titles system in 1999 extinguish the Town’s beneficial ownership of the Parkette? 3. Is any claim that the Town may have to the Parkette statute-barred under ss. 4 or 5 of the Real Property Limitations Act? 4. Did the application judge err in determining that the Parkette was conveyed to the Town in accordance with the doctrine of dedication and acceptance? [11] For the reasons that follow, I am of the view that the application judge did not err in his determination of the above issues, and I would dismiss the appeal. C. Analysis (1) Did the 1973 subdivision agreement supersede the 1972 subdivision agreement with respect to the Parkette? [12] In 1972, Sorrento and other related companies entered into a subdivision agreement with the Town with respect to land located in Plans 870, 887 and 930. Schedule F of the 1972 subdivision agreement provided that the Parkette would be conveyed to the Town for use as parkland. Under the 1972 subdivision agreement, the Town could be required to re-convey the Parkette if the following circumstances were met: land to the north of the Parkette was developed; and another area of parkland was deeded to the Town. [13] The 1972 subdivision agreement was registered on the parcels of land to be developed in Plans 870, 887 and 930, but not on the Parkette, which is located in Plan 990. There is no dispute that the subdivision, which was the subject of the 1972 subdivision agreement, was developed but that title for the Parkette was not conveyed to the Town. [14] In March 1973, Sorrento transferred the land in Plan 990 to Great Georgian, a partnership that included Sorrento. Subsequent to this transfer, in December 1973, Great Georgian entered into a subdivision agreement with the Town with respect to land situated in Plans 994 and 990. The 1973 subdivision agreement also provided for the conveyance of the Parkette to the Town. However, the agreement did not provide that the Town could be required to re-convey the Parkette. The 1973 subdivision agreement was registered on the title to the parcels of land to be developed in Plans 994 and 990, including the Parkette. [15] The appellants acknowledge the contradiction between the 1972 and 1973 subdivision agreements regarding the terms about the conveyance of the Parkette. They submit that the inclusion of the Parkette in the lands to be conveyed to the Town in the 1973 subdivision agreement was a mistake. According to the appellants, the application judge erred in failing to find that the 1972 subdivision agreement should prevail over the 1973 subdivision agreement. They argue that the 1972 re-conveyance provisions in relation to the Parkette are still in force and can be invoked by the appellants to require the Town to re-convey the Parkette. [16] I disagree. [17] The application judge held that the 1972 and 1973 subdivision agreements were clear and unambiguous. In particular, he found that the 1973 subdivision agreement plainly did not include a re-conveyance provision, which was not in dispute. He rejected the appellants’ submission and evidence that the inclusion of the Parkette in the 1973 agreement was an error. These conclusions were open to him on the evidentiary record before him. [18] The application judge’s interpretation of the meaning of the 1972 and 1973 subdivision agreements is subject to deference; absent extricable error, this court cannot intervene: Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633, at paras. 50-55. I see no error and therefore no basis to interfere with the application judge’s interpretation of the subdivision agreements. [19] Accordingly, I would dismiss this ground of appeal. (2) Did the administrative conveyance of the Parkette into Land Titles extinguish the Town’s equitable interest? [20] That the 1973 subdivision agreement prevails with respect to the conveyance of the Parkette to the Town also disposes of the appellants’ argument that the administrative conveyance of the Parkette into Land Titles extinguished the Town’s interest in the Parkette. The appellants’ arguments depend on the enforceability of the re-conveyance clause under the 1972 subdivision agreement, which the application judge determined was superseded by the terms of the 1973 subdivision agreement. By virtue of those conveyance provisions, the Town acquired a beneficial interest in the Parkette of which the appellants had actual notice. [21] Under the 1973 subdivision agreement, title to the Parkette should have been transferred to the Town: the Town had performed everything it was required to do under the agreement and the agreement was fully implemented. Indeed, there is no dispute that Sorrento delivered the deed to the Parkette to the Town in December 1973. That the deed was subsequently lost and title was mistakenly not registered in the Town’s name does not affect the Town’s equitable interest in the Parkette. [22] The appellants argue that the administrative conveyance of the Parkette into Land Titles extinguished any interest that the Town may have had in the Parkette. The difficulty with the appellants’ argument is that it ignores the uncontroverted fact that they and their predecessors in title had actual notice of the Town’s equitable interest in the Parkette. [23] It is well-established that the Land Titles Act has not abolished the equitable doctrine of actual notice. [24] In rejecting the argument that the Land Titles Act in Ontario abrogated the principle of actual notice, Spence J. in United Trust Co. v. Dominion Stores Ltd. et al, [1977] 2 S.C.R. 915, at p. 952, stated for the majority: However, in Ontario, only a few years after the enactment of the Land Titles Act, the courts have expressed a disinclination to imply such an extinction of the doctrine of actual notice. There is no doubt that such doctrine as to all contractual relations and particularly the law of real property has been firmly based in our laws since the beginning of equity. It was the view of those courts, and it is my view, that such a cardinal principle of property law cannot be considered to have been abrogated unless the legislative enactment is in the clearest and most unequivocal of terms. [25] It is thus clear that in Ontario the doctrine of actual notice is applicable even if the lands in question are in the Land Titles system. [26] In consequence, as a result of their having actual notice, notwithstanding that the appellants subsequently disputed the Town’s interest, the administrative conveyance of the Parkette into the Land Titles system was subject to the Town’s interest: United Trust v. Dominion Stores et al. [27] Accordingly, I would dismiss this ground of appeal. (3) Is any claim that the Town may have to the Parkette statute-barred under ss. 4 or 5 of the Real Property Limitations Act? [28] The appellants submit that any claim under the 1973 subdivision agreement, or any other claim that the Town may have had in relation to the Parkette, was extinguished well before the Town commenced its present application in 2015. Specifically, the appellants argue that the Town’s claim was subject to the ten-year limitation period under s. 4 of the Real Property Limitations Act, R.S.O. 1990, c. L.15 (“RPLA”). [29] According to the appellants’ submissions, the limitation period with respect to the Town’s claim began to run, at the earliest, shortly after the completion of the 1973 subdivision agreement, when the Town should have realized that the Parkette had not been conveyed to it, or, at the latest, in 1995, when Sorrento demanded re-conveyance of and asserted ownership over the Parkette. As a result, the Town’s claim is statute-barred.[1] [30] For the reasons that follow, I would reject this ground of appeal. [31] I agree that the Town’s claim to the Parkette is subject to the ten-year limitation period under s. 4 of the RPLA. Section 4 creates a ten-year limitation period for an action to “recover” land. It provides as follows: 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. [Emphasis added.] [32] The words “action to recover any land” in s. 4 of the RPLA are not limited to claims for possession of land or to regain something a plaintiff has lost. Rather, “to recover any land” means simply “to obtain any land by judgment of the Court” and thus these words also encompass claims for a declaration in respect of land and claims to the ownership of land advanced by way of resulting or constructive trust: Hartman Estate v. Hartfam Holdings Ltd., [2006] O.J. No. 69, at para. 56; McConnell v. Huxtable, 2014 ONCA 86, 118 O.R. (3d) 561, at paras. 38-39. [33] However, I am not persuaded that the ten-year limitation period applicable to the Town’s claim to the Parkette ever started to run, as provided for under s. 5(1) of the RPLA. Section 5(1) reads as follows: 5(1) Where the person claiming such land or rent, or some person through whom that person claims, has, in respect of the estate or interest claimed, been in possession or in receipt of the profits of the land, or in respect of the rent, and has, while entitled thereto, been dispossessed, or has discontinued such possession or receipt, the right to make an entry or distress or bring an action to recover the land shall be deemed to have first accrued at the time of the dispossession or discontinuance of possession, or at the last time at which any such profits or rents were so received. [Emphasis added.] [34] Under s. 5(1) of the RPLA, possession can operate to postpone the commencement of the limitation period: if the claimant has been in possession of the land, s. 5(1) postpones the commencement of the limitation period to the time of dispossession or discontinuance: Hartman, at para. 34. Here, there is no evidence that the Town was ever dispossessed or discontinued in its possession of the Parkette. [35] On the contrary, it is common ground that the Town has been in continuous physical possession of the Parkette since 1974. Although there was evidence of various discussions between the Town and the appellants concerning their respective claims of ownership, the Town never returned possession of the Parkette to the appellants. Indeed, the Town’s refusal to do so prompted the commencement of Sorrento’s application in 1997 and then ultimately culminated in the present proceedings. [36] The appellants submit that s. 5(1) of the RPLA has no application to the present case because the conditions precedent contained in that provision are not met. Specifically, they submit, the Town was never in possession of the Parkette “while entitled thereto” or at all because the Town had no right to possession other than with the appellants’ consent. [37] I disagree. The appellants’ argument again rests on the operation of the re-conveyance clause under the 1972 subdivision agreement. For the reasons already stated, I agree with the application judge’s conclusion that the unconditional conveyance of the Parkette to the Town under the 1973 subdivision agreement supersedes the re-conveyance clause under the 1972 subdivision agreement. There is no dispute that the 1973 subdivision agreement was implemented. As a result, as beneficial owner, the Town has been and remains entitled to possession of the Parkette. Further, as explained above, the Town’s possession of the Parkette has not been interfered with or discontinued. [38] Accordingly, the Town’s claim to the Parkette is not statute-barred. (4) Does the doctrine of dedication and acceptance apply? [39] As an alternative conclusion, the application judge determined that the Town is entitled to ownership of the Parkette by application of the doctrine of dedication and acceptance. In particular, the application judge found that the Parkette had been dedicated by its owners, and accepted and developed by the Town, for public use as a park. [40] The appellants do not dispute that, for almost 40 years, the public has been using the Parkette as a park with no interference or obstruction. However, the appellants submit that the application judge erred in determining that the doctrine of dedication and acceptance applies because of the re-conveyance provision of the 1972 agreement. They argue that this provision establishes that there was no intention to dedicate the Parkette as a public park. [41] I would reject this submission. [42] For the reasons already noted, I would uphold the application judge’s determination that the 1973 agreement superseded the 1972 agreement in relation to the conveyance of the Parkette. [43] The appellants concede, in para. 128 of their factum, that if the 1972 agreement does not apply, the 1973 agreement could be read to show an intention to dedicate the Parkette to the Town. [44] I agree. [45] In paragraphs 95 to 99 of his reasons, the application judge correctly cites the leading authorities on the doctrine of dedication and acceptance with respect to public recreational land. He properly sets out the two criteria that must be shown in order for the doctrine to apply, namely, that there was an actual intention to dedicate the land by the owner; and, that it must appear that the intention was carried out in that the land was open to the public for use, and the public accepted it: see Gibbs v. Grand Bend (Village) (1995), 26 O.R. (3d) 644 (C.A.); Wright v. Long Branch (Village), [1959] S.C.R. 418, citing with approval at p. 423, Re Lorne Park Road (1914), 33 O.L.R. 51 (C.A.). [46] In his reasons, the application judge made numerous findings of fact supporting his conclusion that, despite the Parkette never having been deeded to the Town, Waterstone’s predecessors had dedicated the Parkette as parkland for public use. These findings include: neither Sorrento nor Great Georgian objected to the land being zoned for recreational purposes; Great Georgian registered the plan of subdivision for Plan 990 on title showing the Parkette as parkland; and neither Great Georgian nor Sorrento nor any other successor in title asserted a right to the Parkette until at least 1995. [47] The application judge found that nearly four decades of public use of the Parkette as a park constituted acceptance by the public. Since 1977, the Town has consistently been responsible for maintaining the land as a park available for public use, for instance, by the installation of playground equipment that the application judge found was clearly listed in the park inventory. The record also suggests the owner paid no taxes on the property for these decades, save for in 2013 and 2014 as a result of assessments that the Town indicates arose automatically from the 2013 transfer of title to Waterstone. Taken together, these facts distinguish this case from this court’s decision in Cook’s Road Maintenance Assn. v. Crowhill Estates (2001), 196 D.L.R. (4th) 35 (Ont. C.A.). [48] Citing the reasons of Brooke J.A. in Gibbs, at p. 680, the application judge observed that “[o]pen and unobstructed use by the public for a substantial period of time is, as a rule, the evidence from which a trier of fact may infer both dedication and acceptance” and that “[o]nce a dedication is complete, neither the owners nor their successors in title could revoke it.” See also Lehtiniemi v. Mattawan (Municipality), 2016 ONCA 940, [2016] O.J. No. 6473, at para. 19. [49] These findings were open to the application judge on the record before him. I see no error in the application judge’s conclusion that the doctrine of dedication and acceptance applies and that the Town is therefore entitled to ownership of the Parkette. (5) Other issues [50] Given my proposed disposition of the above issues, it is not necessary to deal with the other grounds of appeal. D. Disposition [51] Accordingly, I would dismiss the appeal. [52] As agreed, the respondent, as the successful party on appeal, is entitled to costs in the amount of $42,000, inclusive of disbursements and HST. Released: August 1, 2017 “L.B. Roberts J.A.” “I agree C.W. Hourigan J.A.” “I agree M.L. Benotto J.A.” [1] It does not appear that this specific argument was ever advanced before the application judge. Rather, as indicated in the application judge’s reasons, the limitation period argument was limited to the issue of adverse possession. Ordinarily, this court would not entertain an argument raised for the first time on appeal. However, the respondent Town made no objection to it and provided a response. Moreover, although minimal, there is a sufficient evidentiary foundation to allow this court to dispose of this ground of appeal.