Avery v. Pointes Protection: The Saga of ‘Development or Wetland’ Continues

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Editor’s Note: The ongoing matter between the developers and the PPA is a complex one. For readers that require further background, please help yourself to our archives on the subject. Also, though both parties were contacted for this article, both are reserving comments until all matters described below are resolved in the Courts.

BACKGROUND

Though out of the media eye for the most part in 2016, the contention between developer Jeff Avery, Dr. Patricia Avery, and the Pointes Protection Association has maintained a low boil since a February 2015 ruling of the Ontario Municipal Board that denied a development application submitted by Avery.

The proposed development, referred to as Pointe Estates, has been a matter of debate for a decade. The 102 hectare property was purchased in the 80’s by the Averys who envisioned that the land would eventually be developed. Today that vision has manifested into plans for a 91-lot subdivision complete with a man-made canal. The controversy arises due to the fact that the Averys property is located on a coastal wetland that connects to the St. Mary’s River. In 2008, a group of 27 residents living in Pointe Louise and Pointe aux Pins, both enclosing the wetland, formed a group referred to as Pointes Protection Association (PPA), to provide a coordinated voice in opposition to the development and protection of the wetland.

Requiring approval from the Sault Ste. Marie Conservation Authority (SSMCA) to build on the wetland Avery was denied the first time in 2006 in accordance with Ontario Regulation 176/06 which prohibits development on a wetland. The request also contravened the City of Sault Ste. Marie’s bylaw that stated any wetland over 2 hectares could not be developed and areas closer than 90 meters to the perimeter of the wetland also could not be developed.

Avery was denied approval a second time by SSMCA in 2010.

In December 2012, the SSMCA Board, with a couple of new members at the table, entered mediation with Avery, authorizing Avery’s permit for the Pointe Estates project. This decision launched an entirely new debate when the PPA challenged the Conservation Authority Board’s in their decision to grant Avery a building permit.

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What happened next is at the heart of the most recent battle between Avery and the PPA –a 6 million dollar lawsuit served by Avery against members of the PPA. We’ll get to this further into this article.

On March 19th, 2013, the PPA, served the SSMCA Board a notice of application for judicial review that stated “the Conservation Authority Board’s Resolutions 103/12 and 104/12 on December 13, 2012 ‘are illegal and invalid,’ and contravene the Conservation Authorities Act, and Sault Ste. Marie Region Conservation Authority Regulation of Development, Interference with Wetlands and Alterations to Shorelines and Watercourses, as amended under the Conservation Authorities Act.” The documents also state that the Board “exceeded its jurisdiction by passing Resolution 103/12 and Resolution 104/12 with no reasonable evidence to support its decision.”

The Application for Judicial Review was settled between Avery and the PPA by way of Minutes of Settlement in September 2013. There are 8 agreements attached to the Minutes of Settlement including:

The PPA and the PPA members undertake and agree that in any hearing before proceeding before the Ontario Municipal Board (OMB) or any other subsequent legal proceedings that they will not advance the position that the Resolutions passed by the SSMRCA on December 13th, 2012 in regards to the Pointe Estates Development under subsection 3(1) of the Ontario Reg. 176/06 are illegal or invalid or contrary to the provisions of the Conservation Authorities Act R.S.O. 1990 c. C.27 and Ontario Reg. 176/06 being the Regulation of Development, Interference with Wetlands and Alterations to Shorelines and Watercourses or that the SSMRCA exceeded its jurisdiction by passing the above noted Resolutions with no reasonable evidence to support its decision and considered factors extraneous to those set out in subsection 3(1) of the Ont. Reg. 176/06.

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The above information is significant owing to the fact that two months prior to the agreement upon the Minutes of Settlement, on July 15th, 2013, Avery and his associates attended a Sault Ste. Marie City Council meeting seeking final approval to proceed with the building permit and begin executing plans for the development. Though his request was approved by city staff, Avery’s request was denied by City Council.

Avery immediately launched an appeal to the Ontario Municipal Board (OMB). The PPA, as well as the Binational Public Advisory Council, were granted party status.

During the OMB hearing, which ran the span of three weeks, several witnesses were called forward including PPA president, Peter Gagnon.

The OMB adjudicator, Blair Taylor, permitted Gagnon’s participation though Avery’s defence objected, arguing that a process to enter Gagnon’s, a retired forester, evidence as ‘expert’ had not been undertaken and that his evidence was breaching the Minutes of Settlement. Taylor was satisfied that neither point had merit.

While many issues were addressed over the course of the hearing what is relevant to this article is the testimony of Gagnon.

In his final decision dated February 27th, 2015, Taylor wrote:

In reaching this decision the Board has preferred the evidence of the respondents, and particularly that of Peter Gagnon. Notwithstanding all the resources available to the Applicants and the City Planning Department, Mr. Gagnon did what no land use planner called by the Applicants did: he took the City’s Drainage and Elevation Overview (Exhibit 51A) depicting the extent of the wetlands on the Subject Lands and created a transparent overlay of the draft plan of subdivision. With this overlay he alone was able to calculate the loss of wetlands from the proposed development.

This was just one, but a very important one, factor that informed the OMB’s final decision. What Peter’s old school maps demonstrated was a 77% loss of the coastal wetland should the development proceed.

Of his decision, Taylor wrote:

the Board finds that the development application does not have appropriate regard for matters of provincial interest, is not consistent with the Provincial Policy Statement, is contrary to the Official Plan of the City of Sault Ste. Marie, does not have appropriate regard for the provisions of s. 51(24) of the Planning Act as they relate to the draft plan of subdivision and the draft plan of condominium, that the proposed zoning would be contrary to the Official Plan and the 5 PL130890 proposed development application in its entirety does not represent good planning. Thus the Board dismisses the appeals in their entirety.

Avery filed an Application for Leave to Appeal with the Divisional Court. On September 4th, 2015 launched a second and separate action –a 5 million dollar lawsuit plus 1 million dollars for punitive damages against the PPA.

We’ll deal with the decision on the Application for Leave to Appeal first.

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Justice Ellies Decision on the Leave to Appeal

In the Application, the developers allege “the Board committed a number of errors, ranging from such fundamental errors as a denial of justice, to more specific errors, such as misinterpreting the meaning of terms used in policy statements issued under the Planning Act.”

In the Application, Avery raised two primary issues, alleging that the Board erred in finding: that the development would have a negative impact on coastal wetlands, contrary to the 2014 Provincial Policy Statement and the Official plan; and that the development is contrary to the Official Plan on the basis that it is not ‘limited’ residential development.

In his decision dated November 28th, 2016, Justice J. Ellies, refused Averys application to appeal the OMB decision in Divisional Court. Ellies wrote:

…none of the issues raised meets the onerous test for granting leave, either because the issue is not a question of law, there is no reason to doubt the correctness or reasonableness of the decision, or the issue is not one of sufficient to warrant appellate review.

The Application raised an additional 17 errors including:

(8) with respect to the witness, Peter Gagnon:

(a) breached procedural fairness and natural justice by letting Gagnon give expert evidence about wetland loss in contravention of the settlement agreement with PPA; and

(b) failed to provide reasons for preferring Gagnon’s evidence over that of their experts; and

(c) failed to give reasons.

The developers assert that Gagnon’s evidence at the OMB was a breach of the September 2013 Minutes of Settlement and that the OMB made error in permitting Gagnon to give evidence.

On the matter of the Board permitting Gagnon’s evidence, the defence outlines three arguments:

  • The Board breached procedural fairness because Gagnon’s [a retired forester]evidence was actually expert evidence and Gagnon never signed an acknowledgement of expert duty, never participated in a meeting of like experts, and never submitted an expert report;
  • The Board erred in preferring the testimony over that of McConnell [City Planner] and Wierzbicki [witness for the defence]; and
  • The Board failed to provide reason for doing so.

In his decision, Ellies remarked of the OMB’s preference for Gagnon’s evidence over the developers’ expert witnesses writing:

(103) …if it was an error of any kind to prefer the evidence of Gagnon, it was not an error of law.

But Ellies agreed that the OMB ought to have recognized Gagnon’s testimony as expert testimony writing:

(104) The developers’ argument that the Board breached procedural fairness in allowing Gagnon’s testimony about the amount of wetland loss is more troubling than its other arguments. In my view, the Board did commit an error in failing to recognize that Gagnon’s evidence was not lay witness evidence and was, instead, expert evidence.

In his 34-page decision denying the developers leave to appeal before the Divisional Court, Ellies addresses the applicant’s allegation that the presentation of Gagnon’s testimony was a breach of the Minutes of Settlement.

To reiterate what has been written above and as written by Ellies, the developers:

…maintain that Gagnon’s evidence breached the minutes of settlement by advancing the position that the SSMRCA’s approval was “illegal or invalid or contrary” to the Conservation Authority Act and O. Reg. 176/06. The developers argue that Gagnon’s evidence constituted an indirect attack on the SSMRCA’s decision to approve the developers’ application because it suggested that the SSMRCA’s decision was in breach of the Conservation Authorities Act and regulations, which prohibited development in wetlands that would affect the “conservation of land”.

Ellies did not agree with the developer’s position writing:

(112) …I agree with the submissions made on behalf of the PPA that the minutes dealt specifically with the SSMRCA’s approval under the Conservation Authorities Act and its regulations. The minutes did not restrict the PPA from advancing issues relating to the Planning Act and the PPS.

And:

(113)…The fact that the loss of wetlands was also a consideration relevant to the SSMRCA’s decision does not mean that Gagnon was adopting a position that the SSMRCA’s decision was illegal. His evidence related to Planning Act matters, not to the Conservation Authorities Act or its regulations.

In his conclusion, Ellies writes:

(138) I have no doubt that the developers’ plans for the Pointe Estates subdivision were the culmination of a long-standing dream. There is also no doubt that there were significant financial interests at stake. The decisions of the SSMRCA, of Sault Ste. Marie city council, and then of the Board must have been difficult for the developers to accept. The same is likely true of my decision.

However, be that as it may, the developers’ have not given up hope yet that this development can be built. Though a rare action, the developers have the right to request a review of Ellies decision and have done so.  This matter remains before the Courts and the decision on the review is pending.

The Lawsuit

Upon the conclusion of the OMB hearing, Avery issued a 6 million dollar claim against members of the PPA for an alleged breach of the Minutes of Settlement.

Just to remind the reader one more time of the condition that the developer alleges was breached, it was agreed by both parties that:

The PPA and the PPA members undertake and agree that in any hearing before proceeding before the Ontario Municipal Board (OMB) or any other subsequent legal proceedings that they will not advance the position that the Resolutions passed by the SSMRCA on December 13th, 2012 in regards to the Pointe Estates Development under subsection 3(1) of the Ontario Reg. 176/06 are illegal or invalid or contrary to the provisions of the Conservation Authorities Act R.S.O. 1990 c. C.27 and Ontario Reg. 176/06 being the Regulation of Development, Interference with Wetlands and Alterations to Shorelines and Watercourses or that the SSMRCA exceeded its jurisdiction by passing the above noted Resolutions with no reasonable evidence to support its decision and considered factors extraneous to those set out in subsection 3(1) of the Ont. Reg. 176/06.

And as mentioned above, the developers allege that this breach occurred when Peter Gagnon, President of the PPA, presented his testimony before the OMB that provided there would be a significant loss to the coastal wetland should the development proceed.

To recall –the OMB gave considerable weight to Gagnon’s opinion. And one more point to recall –Justice Ellies, in reviewing the developers leave to appeal the OMB ruling, included among many other points, in his decision to deny the developers leave to appeal, his reasoning for rejecting the allegation that the PPA breached the terms of contract.

In response to Avery’s lawsuit, the PPA immediately brought a motion to dismiss the developer’s claim under very new law –the Protection of Public Participation Act, 2015, which amends certain provisions of the Courts of Justice Act. The law, often referred to as an Anti-SLAPP motion (strategic lawsuit against public participation), is designed to shut down lawsuits that arise from expressions- written or spoken, made by an individual on matters of public interest and to mitigate frivolous claims before the Courts.

The motion was heard by Justice E. Gareau in the Ontario Superior Court.

The anti-SLAPP motion required the defendant –PPA, to prove that the expression –Gagnon’s evidence before the OMB, was an expression that was a matter of public interest. In his reasoning dated April 25th, 2016 Gareau was satisfied that the PPA met this test. Gareau wrote:

(39) …I conclude on the evidence before me that this was a matter of public interest to the community of Sault Ste. Marie and that it affected the community at large. This was more than a “not in my backyard” type of private interest dispute.

However, the plaintiff- Avery, had recourse to preserve his claim if able to prove that the action –the lawsuit, had: substantial merit; that the defendant- PPA, had no valid defence; and that the harm likely to be or have been suffered by Avery as a result of the PPA’s expression is sufficiently serious that the public interest is permitting the proceeding to continue outweighs the public interest in protecting that expression.

On the test of substantial merit Gareau wrote:

(47) The claim of the plaintiff involves the sanctity of agreements made between parties. This is not a claim that is frivolous or fleeting. It is a claim of importance involving a serious matter to be considered by the court. In other words, it is a claim of substance. In my view, the claim advanced by the plaintiff has substantial merit and is a claim that should be considered by the court. The plaintiff has met the first test for consideration…

The second test required Avery to prove that the PPA had no valid defence. In his findings Gareau noted that the PPA had not filed a defence and therefore there the PPA had no valid defence. Gareau wrote:

(50) The defendant has not pleaded its defence in this proceeding. Without a pleading there is no way for the court to be satisfied that it has a “valid defence” in the proceeding and I am not satisfied that the defendant has a “valid defence” based on the material before me on the motion…

Of the third test -the harm likely to be or have been suffered by responding party [Avery] as a result of the moving party’s [PPA] expression is sufficiently serious that the public interest is permitting the proceeding to continue outweighs the public interest in protecting that expression, Gareau wrote:

(55) In my view, the public interest in allowing the litigation to continue and permitting the issues related to the minutes of settlement and the finality of agreements made between parties to be adjudicated outweighs the public interest in protecting the right of Peter Gagnon to freely express himself by giving evidence before the Ontario Municipal Board.

Gareau was satisfied that both parties met their burden of proof and his final decision was to allow the lawsuit to proceed in due course.

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As with the review of the Reason for Decision on Application for Leave to Appeal, the matter of the lawsuit is still before the Courts with decisions anticipated in early 2017.

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