Law Times

Law Times • augusT 20, 2018 Page 15 www.lawtimesnews.com icy. Defendant's alleged negligent use of all-terrain vehicle was not predicate element of allegations of his negligent interference, obstruction and impediment of plaintiff 's person and activities. There was no clear intention that exclusion was meant to apply to whatever acts insured commit- ted while passenger on motor- ized vehicle simply because of their status as passenger. It was reasonable for parties to expect that policy afforded coverage to extent that claim was attributable to unexcluded and otherwise covered cause. Based on manner in which it drafted "motorized vehicle" exclusion, insurer ought reasonably to have anticipated that coverage for claim would not be avoided in circumstances of concurrent causes, where one cause was subject to exclusion and other was covered by terms of policy. Coachman Insurance Co. v. Kraft (2017), 2017 CarswellOnt 5318, 2017 ONSC 1875, Gregory J. Verbeem J. (Ont. S.C.J.). CLAIMS Payment of insurance proceeds Motions judge committed legal error in finding policy did not obligate insured to repay overpayment Overpayment. Insureds owned and operated dentistry practice in building destroyed by fire. In- surer made series of payments to insured prior to determination of total loss, including $750,000 advance towards loss payable for building. Parties subsequently participated in appraisal and total amount payable was found to be $926,677, but insurer had already advanced $1,030,187 to insureds, so brought action for recovery of overpayment. Mo- tions judge granted summary judgment permitting insureds to keep total amount paid. In- surer brought appeal from mo- tions judge's decision. Appeal allowed; insurer granted sum- mary judgment against insureds for $103,510. Insurance contract was one of indemnity, and mo- tions judge erred in ignoring this fundamental principle. Motions judge failed to consider insurer's duty of good faith to facilitate insureds' claim and importance of timing where insured had only one year of business inter- ruption coverage. Motions judge erred in finding insurer's email permitted insureds to keep full amount regardless or quantum of loss determined; email spe- cifically stated insureds were entitled to actual cash value of loss. There was no suggestion in correspondence that insurer was bound by $750,000 pay- ment, which was clearly ad- vance pending determination of actual cash value through ap- praisal. Insureds clearly did not feel bound as they continued to dispute insurer's figures after payment. Motions judge's error in equating advance with actual cash value caused him to con- clude insurer communicated insureds could keep funds no matter what, which was palpa- ble and overriding error of fact. Motions judge committed legal error in finding policy did not obligate insured to repay over- payment, which was antitheti- cal to bargain struck by parties and provision of policy stating insurer was not liable beyond actual cash value. Motions judge failed to consider purpose and scheme of Insurance Act, and ruling conf licted with defini- tion of insurance and purpose of appraisal. Motions judge erred in unjust enrichment analysis, as insureds clearly received benefit with corresponding deprivation to insurer, and email did not state insureds could do as they wished with funds regardless of appraisal, so there was no juristic reason for deprivation. Gore Mutual Insurance Company v. Carlin (2018), 2018 CarswellOnt 11266, 2018 ONCA 628, K. Feldman J.A., C.W. Hou- rigan J.A., and David Brown J.A. (Ont. C.A.). Municipal Law BYLAWS Enforcement City's actions after delivery of debarment letter cured initial lack of procedural fairness Pursuant to bylaw, respondent city disbarred applicant con- tractor from bidding on city contracts for four years on basis that contractor issuing statement of claim against city; contractor violated health and safety leg- islation; and contractor having significant history of abusive and threatening conduct toward city employees. Contractor met with city in effort to have debarment decision rescinded, and then sent letter to city containing writ- ten submissions explaining why it should not be debarred. City sent contractor reconsideration letter upholding debarment de- cision, and it pointed to other in- stances of contractor's behaviour that provided further support for decision. Contractor applied for judicial review. Application dismissed. Given discretionary nature of bylaw and importance of decision to contractor, duty of procedural fairness entailed giv- ing contractor notice of decision to debar, opportunity to respond before final decision was made and reasons for decision. Con- tractor was given full opportu- nity to meet with city's decision- makers to make submissions on debarment decision after receiving notice in debarment letter of grounds upon which debarment decision was based, and there were further written communications exchanged. City's actions after delivery of de- barment letter cured initial lack of procedural fairness resulting from failure to give contractor opportunity to respond prior to decision. Whether or not there were additional reasons for deci- sion to debar contractor set out in reconsideration letter was not determinative as, even without considering any of those addi- tional reasons, there were ample grounds to debar contractor for four years, and decision was rea- sonable. Interpaving Limited v. City of Greater Sudbury (2018), 2018 CarswellOnt 10758, 2018 ONSC 3005, Wilton-Siegel J., Thorburn J., and Ellies J. (Ont. Div. Ct.). PLANNING APPEAL BOARDS AND TRIBUNALS Jurisdiction Aggregate Resources Act consideration of land-use planning matters engaging Ministry of Natural Resources and Forestry Policies Ontario Municipal Board (OMB) issued interim order ap- proving Official Plan amend- ments and zoning bylaw amend- ments in respect of G Inc.'s pro- posed quarry, pending resolu- tion of neighboring county's re- quest that OMB impose condi- tion requiring G Inc. to pay haul route maintenance costs. OMB held it had jurisdiction and au- thority to direct licensee to un- dertake or contribute to mainte- nance and repair costs, that ob- ligation was to remain in place for operation's lifetime, and that it was appropriate and in public interest that it do so with respect to G Inc.'s quarry. G Inc. brought application for leave to appeal. Application dismissed. All ques- tions of law submitted by G Inc. concerned OMB's specialized expertise, so standard of review was reasonableness. OMB made no error in interpreting legis- lation. OMB could only make reasoned decision about issuing licence by interpreting subsec- tions of s. 12(1) of Aggregate Re- sources Act (ARA) collectively. Legislature's failure to specifi- cally mention fees in Regulation did not mean it intended to re- move all discretion as to funding from consideration. OMB did not impose fee, but reasonably held that county whose ratepay- ers would be underwriting cost to upgrade and repair trans- portation network for benefit of G Inc. be reimbursed for costs. OMB's reasoning was consis- tent with principle of statutory interpretation that words of Act were to be read in entire con- text, in grammatical and ordi- nary sense, harmoniously with scheme of Act, object of Act and intention of parliament. When combined with ss. 11 and 12 of ARA, ss. 36 and 37 of OMB Act gave OMB wide powers to deter- mine all questions under ARA. OMB reasonably found that ARA consideration of land-use planning matters also engaged Ministry of Natural Resources and Forestry Policies. OMB's did not impose fee or service charge bylaw but found it had jurisdic- tion to require condition that quarry operator contribute to upgrading and or maintenance of non-host haul route. OMB made no error on clear and un- contested evidence before it that project would result in need for increased maintenance and re- pair; in any case, its findings of fact were not subject to review. OMB carefully reviewed and considered its jurisdiction to withhold final order on licence to allow parties to determine equitable share each should bear for haul route's repair and main- tenance. Decision to withhold licence involved thorough and balanced assessment of legisla- tion in which it had specific ex- pertise and was accorded defer- ence. Decision clearly fell within range of possible, acceptable outcomes defensible in respect of facts and law. Giofam Investments Inc. v. Simcoe (County) (2018), 2018 CarswellOnt 10319, 2018 ONSC 3923, Alexander Sosna J. (Ont. S.C.J.); leave to appeal refused (2017), 2017 CarswellOnt 12067, Justin Duncan Member (O.M.B.). ZONING Zoning bylaws Zoning bylaw definitions of " dwelling unit" and " lodging house" can vary Applicant K owned four proper- ties in respondent municipality of G. G said K operated lodging house as defined by G's bylaws because he rented to number of tenants i each house. K argued that he simply owned "dwelling units" as defined by G's bylaws. K brought application for decla- ration that each of his four prop- erties in G was not being used as "Lodging House Type 1", as defined in zoning bylaw. K also sought mandatory order requir- ing G to remove any references to properties being lodging houses from its website or elsewhere under G's control. Application granted. To determine if Lodg- ing House Type 1 use was occur- ring, required assessment under G's zoning bylaw did not focus on type of lease or behaviours of tenants. Definitions asked how many "living accommoda- tion" rooms were being used as "rental units" in building and whether tenants shared kitchen and bathroom facilities. Case law on lodging houses shows that zoning bylaw definitions of "dwelling unit" and "lodging house" can vary depending on what particular municipal au- thority has chosen to emphasize. On agreed facts, it was found that K was renting one unit to several people, not several units to several people. At each prop- erty, tenants collectively signed one tenancy agreement of entire dwelling unit, with intention that no individual tenant had ex- clusive possession of any portion of unit. Tenants here were rent- ing "group of rooms" and were occupying them "exclusively as an independent and separate self-contained housekeeping unit". Each of tenants in ques- tion in this application was not renting "a room". Each group of tenants had pre-existing friend- ships at time they approached K as prospective tenants. Each of properties was rented single unit to that group. For each property, single lease was signed by single group. Tenancy agreements pro- vided that each tenant was joint- ly liable for total rent payable for entire dwelling unit. Each group of tenants had full access to and control over entire unit and there was no "exclusive posses- sion" by any single tenant. Bed- room doors did not have key- locks. This was not consistent with rental of single room. Use of lands were as one dwelling unit and not five or more lodg- ing units. Applicant was granted declaration. Mandatory order was to be issued that G shall re- move any references on its web- site or elsewhere under G's con- trol to properties in issue being "Lodging House" or "Possible Lodging House", or otherwise suggesting that properties met definition of "Lodging House Type 1" under zoning bylaw. Kritz v. Guelph (City) (2016), 2016 CarswellOnt 21678, 2016 ONSC 6783, Lemon J. (Ont. S.C.J.). Real Property CONDOMINIUMS Agreement of purchase and sale Disclosure of service unit mortgage insufficient to amend agreement of purchase and sale Dispute related to dealings be- tween plaintiff condominium corporation (TSCC) and defen- dant developer/declarant (G Inc.) of condominium. G Inc. owned freehold estate immediately be- fore TSCC was created. Plaintiff- by-counterclaim was assignee of three debt instruments. Parties sought determination of validity and amount of debts. Defendants brought motion for summary judgment. Determination was made as to debts. Disclosure of service unit mortgage was insuf- ficient for purposes of Condo- minium Act, 1998 or to amend agreement of purchase and sale. Reasonable expectations of TSCC and unit purchasers were breached; they did not reason- ably expect to be paying mortgage in respect of items they reason- ably thought unit purchasers had already bought when they pur- chased residential units. G Inc. was not entitled to sell pipes and wires to TSCC and take vendor take-back mortgage in respect those and other items, when it had not properly disclosed to unit purchasers that they had not purchased those items. Required remedy was to adjust terms of service unit mortgage to make it consistent with reasonable ex- pectations; principal amount of service unit mortgage had to be adjusted. Parking unit mortgage was oppressive; unit purchasers and TSCC reasonably expected that significant liability would be disclosed in simple, readable lan- guage, which it was not. Parking unit mortgage principal was to be reduced, to be consistent with reasonable expectations. TSCC No. 2051 v. Georgian Clairlea Inc. et al (2018), 2018 CarswellOnt 9535, 2018 ONSC 2515, Akbarali J. (Ont. S.C.J.). CASELAW

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