News & Posts

Proposed Amendments to the Growth Plan were released January 15, 2019. The commenting period on the Amendments is open until February 28, 2019. There are a number of important changes to take note of found in the Our Guide to Changes in the link below . Our top five are:

1. Flexibility to Add Uses to Employment Lands Before a Municipal Comprehensive Review: Lands within Employment Areas may be converted to a designation that permits non-employment uses in advance of a municipal comprehensive review, provided that there is:
   1. A need,
   2. No adverse effects on the viability of an Employment Area or achievement of minimum intensification and density targets,
   3. There are existing or planned infrastructure and public services in place, and,
   4. A significant amount of jobs are maintained.

However, certain lands will be designated Provincially Significant Employment Zones which can only be converted through a municipal comprehensive review. A list of the proposed employment zones is found in the overview of changes produced by the Ontario Growth Secretariat found in the link below.

2. Settlement Area Changes in Advance of an MCR:

Adjustments -Settlement Area Boundaries may be adjusted by municipalities without an MCR when:

1. There would be no net increase in land within the settlement area,
2. The adjustment would support the ability to meet intensification and density targets,
3. The normally applicable requirements for a settlement area expansion found in policy 2.2.8.3 are met,
4. The land is not a rural settlement or in the Greenbelt, and,
5. The land is serviced and there is sufficient reserve

Expansions – Settlement Area Boundaries may be expanded without an MCR when:

1. The lands will meet the resident and jobs density targets or the employment area density targets established pursuant to the Growth Plan,
2. The normally applicable requirements for a settlement area expansion in policy 2.2.8.3 are met,
3. The land is not a rural settlement or in the Greenbelt,
4. The land is serviced and there is sufficient reserve capacity,
5. The land, accompanying growth, will be fully accounted for in the next Municipal Comprehensive Review, and,
6. The land proposed to be expanded is no greater than 40 hectares.

The opportunity make minor rounding out adjustments to rural settlements has also been added.

3. Support for Transit Oriented Development:  Upper- and single-tier municipalities may delineate the boundaries of major transit stations areas and identify minimum density targets for these areas ahead of a Municipal Comprehensive Review, provided Planning Act requirements regarding official plan policies for these areas are met. The areas affected by these policies is proposed to be expanded to a 500 –  800 metre radius from the Transit Station.

4. Scaled Intensification and Density Targets: Targets for Delineated Built-up Areas and Designated Greenfield Areas now scaled to the degree of urbanization of a municipality. The blanket intensification requirement that 60% of all residential development occur within the Delineated Built-up Area now ranges from 60% to 50% for more urbanized areas with a requirement that existing targets be maintained or improved for less urbanized areas. For Designated Greenfield Areas, the density target of 80 residents and jobs per hectare has been replaced with a range of 60 to 50 for more urbanized areas, and a minimum of 40 in less urbanized areas.

5. Natural Heritage System and Agricultural System Mapping: Provincial Natural Heritage System and Agricultural System mapping does not apply until implemented in an applicable Upper Tier or Single Tier Official Plan and a municipality may refine the provincial mapping before incorporating it into their plan. Until then, existing Official Plan mapping applies.

The following resources may assist those looking for further information.

• The Davies Howe Guide to the Changes. Click here
• The Davies Howe Redline of the Growth Plan, for reference purposes.  Click here
• Overview of changes produced by the Ontario Growth Secretariat, hosted by BILD.  Click here
• The Draft Original Amended Growth Plan.  Click here 
• The Environmental Registry Posting.  Click here
• Governmental News Release.  Click here
• Government Backgrounder.  Click here

Kimberly Beckman and Aaron Platt will be speaking at the OBA’s February 7^th Real Property Law Section meeting on Commercial Real Estate Transactions

Kim and Aaron will discuss due diligence issues that arise in multi-tenant property transaction including reliance on surveys, zoning reliance letters, cost sharing agreements and future development concerns.  They will also address the pitfalls when trying to close a deal in the face of a planning-related issue.

For more details please visit the OBA website

https://www.oba.org/CBAMediaLibrary/cba_on/pdf/Institute2019/19RPR0207C.pdf

The 2018 Novae Res Urbis (NRU) rankings of the Top 10 Development Law Firms have been released and Davies Howe has been ranked #2 in both the GTA and the GTHA.

The NRU describes it as “another stellar year for the Davies Howe team, which continues to prove it is a force to be reckoned with”  and goes on to say ”Davies Howe continues to maintain a powerful presence as one of Toronto’s preeminent planning and municipal law firms.”

We couldn’t have said it better.

On December 6, 2018, the provincial government introduced Bill 66, titled Restoring Ontario’s Competitiveness Act, 2018. Bill 66 proposes more than 30 amendments to existing legislation, including the Planning Act.
If passed in its current form, Bill 66 would add section 34.1 to the Planning Act, allowing local municipalities to pass an “open-for-business planning by-law” (“OFB By-law”). OFB By-laws would fast track zoning permissions for qualifying developments, subject to certain conditions normally associated with site plan approvals.
According to information released by the Ministry of Economic Development, an OFB By-law is intended to “remove planning barriers to expedite major business investments and speed up approvals so they would be completed within one year”.

Exemptions from Provincial Plans, Policies, and Laws
An OFB By-law would be exempt from, among others, the following requirements:
• Consistency with the Provincial Policy Statement, 2014;
• Conformity with the Growth Plan for the Greater Golden Horseshoe, 2017;
• Conformity with the Greenbelt Plan, 2017;
• Conformity with the Lake Simcoe Protection Plan, 2009;
• Conformity with the Oak Ridges Moraine Conservation Plan, 2017;
• Conformity with official plans;
• The applicability of a holding (“H”) provision;
• Height and density bonusing by-laws;
• Site plan approval; however, a municipality may still impose site plan related conditions;
• Subsections 34 (10.0.0.1) – (34) of the Planning Act which would mean, among other things, that:
– A person can apply for an amendment to applicable zoning through an OFB By-law within two years of the parent zoning by-law being passed;
– An OFB By-law cannot be appealed to the Local Planning Appeal Tribunal; and
– A municipality would not be required to give notice or hold a public meeting prior to enacting an OFB By-law;
• Section 39 of the Clean Water Act, which would mean that an OFB By-law would not need to:
–  Conform with significant threat policies and designated Great Lakes policies; and
–  Have regard to other policies set out in a drinking water source protection plan;
• Section 20 of the Great Lakes Protection Plan, 2015, which would mean that an OFB By-law would not need to:
– Conform with initiatives made under this Act; and
– Have regard to policies set out in Schedule 1 of the Act;
• Consistency with any transportation planning policy statement made under sub-section 31.1(4) of the Metrolinx Act, 2006;
• Conformity with any development plan made under the Ontario Planning and Development Act, 1994; and
• Consistency with any applicable policy statements made under the Resource Recovery and Circular Economy Act, 2016.

Procedure to Pass an OFB By-law
The municipality must pass a resolution requesting the Minister of Municipal Affairs and Housing to approve an OFB By-law, and an OFB By-law would also need to satisfy any prescribed criteria that may be established by regulation. If the Minister approves this request, a municipality could formally enact an OFB By-law, subject to any conditions that may be imposed by the Minister.
An OFB By-law would come into force on the 20th day after it is passed by Council, or a later day specified by the Minister. Although no notice is required prior to the passing of an OFB By-law, the municipality must notify the Minister within 3 days and certain persons or public bodies within 30 days of the passing of an OFB By-law.

Proposed Regulation
The provincial government also proposes a new Regulation under Bill 66 that would:
• Require confirmation that the proposal is for a new major employment use;
• Require evidence that the proposal would meet a minimum job creation threshold (e.g. 50 jobs for municipalities with a population of less than 250,000 people, or 100 jobs for municipalities with a population of more than 250,000 people);
• Identify the uses of land, buildings or structures that may be authorized by an OFB By-law, such as manufacturing and research and development, but not residential, commercial or retail as the primary use; and
• Prescribe how notice is to be given to the Minister of Municipal Affairs and Housing following the passing of an open-for-business by-law (similar to how the Minister is notified following the passing of a zoning by-law – e.g. email and personal service).

Legislative Process
The deadline to submit comments to the Environmental Registrar with respect to Bill 66 and its accompanying regulation is January 20, 2019.

Bill 66 has passed first reading. Davies Howe LLP will continue to monitor its status.

If you have any questions regarding Bill 66, please contact one of our municipal, planning and land development lawyers.

Ashely Metallo joined our team in July as an Associate.  Click here for her full bio.

Nadia Kadri joined our team in August as an Associate.  Click here for her full bio.

Samantha Lampert joined our team in September as an Associate.  Click here for her full bio.

Part IV of the Planning Act (the “Act”) outlines municipal authority for the implementation of a “community improvement plan”.

Purpose

The Act allows the designation of a community improvement project area for any “environmental, social or community economic development reason”, including building age or structural condition, overcrowding, poor planning, unsuitability of buildings, or intent to encourage affordable housing.

These justifications have been interpreted broadly since Re Yonge Street Regeneration Project, 1998 CarswellOnt 6675, where a Joint Board of the Ontario Municipal Board and the Board of Inquiry agreed that s. 28 of the Act is not limited to curing physical deterioration. The Joint Board relied on the wording “for any other reason” to conclude that a valid CIP can be undertaken on the basis of physical deterioration and neighbourhood quality.

Upon an application for judicial review of the Joint Board Decision, the Ontario Court of Justice affirmed this view, holding that the language “is sufficiently broad to allow municipalities to designate community improvement project areas on the basis of whether there may be social or economic benefits to such a designation regardless of whether the area suffers from any physical dilapidation or blight”.

Designation

Designation of a CIP by Council under s. 28(2) of the Act requires enabling policy in the municipality’s Official Plan. Based on the definitions provided in Section 28(1) and (1.1), a community improvement project area can be a single, specific property, a larger area that is deemed to be a desirable candidate for redevelopment, or even the entirety of the municipality.

In addition, community improvement plans are subject to Ministerial approval, and the preparation of a community improvement plan is treated in the same manner as the preparation of an Official Plan. Subsection 28(5) incorporates the provisions of Section 17 respecting consultation and public meetings, submissions and comments, adoption of the community improvement plan, and prescribed notice.

Appeal

Section 28 itself does not specify rights of appeal; rather, the ability to appeal a community improvement plan is created by reference. Under section 28(5) of the Act, section 17(49) as it read on the day before the Building Better Communities and Conserving Watersheds Act, 2017, incorporates section 17(36) of the Act, which allows for an appeal of all or part of the decision by a person who made oral or written submissions to Council.

Effect and Opportunities

Where a By-law has been passed to designate a community improvement project area, section 28(3) allows the municipality to acquire, hold, or prepare land for community improvement, or to facilitate private investment.

The statutory powers available to municipalities once a community improvement plan is in effect are described under subsection 28(6) and (7), which allow construction or rehabilitation of buildings on municipally-held land, the granting of financial incentives to owners or tenants, or the disposition of buildings or land by lease or sale to any person for a use that conforms with the community improvement plan.

Community improvement plans may also be used in conjunction with brownfield remediation programs, heritage property relief, and property tax assistance through subsections 365.1 and 365.2 of the Municipal Act, 2001 and subsections 333 and 334 of the City of Toronto Act.

When employed with a community improvement plan, the brownfield remediation assistance provisions allow for a municipality to cancel all or a portion of municipal taxes. They also allow deferral of municipal taxes for contaminated properties within a community improvement project area if the community improvement plan contains policies contemplating tax assistance for remediation of contaminated properties.

A municipality may also pass a By-law to implement property tax relief of 10 to 40 percent for owners of eligible heritage properties, subject to an agreement to protect heritage features.

Without a valid community improvement plan, these grants and loans to private property owners and property tax relief programs would be illegal per section 106 of the Municipal Act, 2001 and section 82(1) of the City of Toronto Act, 2006. The “prohibition against bonusing” in that provision prevents municipalities from financially assisting any industrial or commercial enterprise, including lending money, leasing at below-market value, loan guarantees, or exemptions from charges or fees, unless done under the authority of a valid community improvement plan.

Termination

The municipality may, by By-law, dissolve a community improvement plan and community improvement project area.

Davies Howe is very pleased to welcome Alex Lusty as our newest Associate.
Alex has joined the Land Development group after completing his articles with us.
Click here to read his full bio.

Section 57(1) of the Planning Act (the “Act”) allows a council authorized to grant consents the ability to issue what is known as a “certificate of validation”. These certificates state that a prior contravention of the subdivision control provisions of the Act are deemed to have never had the effect of preventing the conveyance of land or the creation of an interest in land.

Put simply, a validation certificate corrects a Planning Act breach that has already occurred – it “turns back the clock” to re-fuse the chain of title.

For example, if John Smith owned Parcel A, and then purchased the abutting Parcel B, the effect of the transaction may be that Parcels A and B merge into a single parcel on title – even if they have independent parcel identification numbers (PINs).

If Parcels A and B have merged, and John Smith then sells Parcel A to Tim Jones – a  third party – the sale is invalidated as it breaches section 50 of the Act.  In addition, if Tim Jones registered a mortgage on title to Parcel A, the mortgage would also be invalidated.

In this case, a validation certificate for the sale of Parcel A would validate that conveyance as well as the subsequent mortgage by deeming that the contravention of s.50 of the Act to never have prevented the conveyance of Parcel A (thus also validating the subsequent mortgage).

Validation certificates must include both the effect of the validation and a precise legal description of the land subject to the offending conveyance. The certificate becomes legally “valid” from the moment it is issued and has the retroactive effect of curing any other earlier conveyancing mistakes or errors. Though typically used to cure prior contraventions, the issuance of a certificate is not dependent on a subsequent transaction and may be applied for in anticipation of a conveyance or mortgage.

Unlike other Planning Act applications, the stated registered owner of the subject land need not be the applicant for a validation certificate.  In fact, there is no restriction on who can make the application. There is often good reason for this latitude.  For example, the bank in the example above may seek to enforce the mortgage that was invalidated by the conveyance of Parcel A after its merger with Parcel B. Often it is a frustrated owner of land or mortgagee that applies for a validation certificate.

While the authority to grant validation certificates is vested in the council or a committee authorized to give consents under Section 53 of the Act, applications for validation certificates are not governed by the same procedural rules, submission or notice requirements. This follows logically as validation certificates do not create a new lot – they seek only to restore previously existing lot lines that were inadvertently lost.  Also, the need for a validation certificate is often only discovered on the eve of a transaction’s closing.  Especially in the context of a residential transaction, when moving trucks are packed and ready to unload, applications for validation certificates require a swift response.

In issuing a validation certificate, a council or committee shall have regard to the same criteria as when considering a consent application (found in subsection 51(24) of the Act). Additionally, Ontario Regulation 144/95 requires the validation certificate to conform to (but not comply with) any applicable official plan, zoning by-law or ministerial zoning order.

These criteria should be accessed in light of the applicable circumstances.

The overall intent of Section 57(1) is to provide a method of fixing an inadvertent breach of the Act in order to avoid the requirement of a consent application.

In some cases, a parcel may not (or may no longer) comply with applicable zoning by-law standards. But for the ability to obtain a validation certificate, the owner would be required to apply for a consent to re-sever the parcel.  This may also require a variance or rezoning application, to ensure compliance with the applicable zoning by-law. However, the consent, variance and rezoning application processes are far more onerous and may create an undue burden and risks in the circumstances. Therefore, as the regulation specifically requires conformity (rather than compliance) with applicable zoning, the question of unnecessary cost, legal non-conforming status, the burden of addressing an inadvertent error and fairness should be considered in assessing whether a council or committee should grant a validation certificate.

Limitations on Good Faith: Usanovic and Insurers’ Obligations in Respect of Statutory Limitation Periods

Ontario law imposes a duty of good faith and fair dealing on both insurers and those whom they insure. However, the parameters of this duty are not always clear. While it is established law that insurers must adjudicate their claims fairly and in a timely manner, courts are left to determine additional elements of the duty of good faith on a fact-specific basis.
Recently, the Ontario Court of Appeal was asked to extend the duty of good faith to require an insurer to notify an insured of a statutory limitation period under the Limitations Act, 2002. Generally speaking under the Act, plaintiffs seeking to commence legal proceedings must do so within 2 years of the date on which they discovered the injury, damage, or loss in question. In Usanovic v. Penncorp Life Insurance Co. , the Ontario Court of Appeal held that insurers are not obligated as part of their duty of good faith to notify insureds of this limitation period.

The Facts

Fadil Usanovic purchased an insurance policy from Penncorp Life Insurance Co. in 1999. The Policy insured Usanovic against disability arising from accidents and sickness, among other things.
In September 2007, Usanovic fell from a roof and suffered various injuries. He made a claim under the Policy and received disability benefits until November 2011, when Penncorp terminated his benefits because he was no longer “totally disabled” as defined in the Policy. Through counsel in January 2012, Penncorp advised Usanovic that in order to receive further benefits, he was required to submit medical records to prove that he was “unable to engage in any and every occupation for which he was reasonably fit by reason of his education, training, and experience.” Usanovic did not provide Penncorp with any medical records.
In early 2015 Usanovic consulted a lawyer who advised him of the limitation period under the Act. At this time, Usanovic became aware that he should have commenced an action against Penncorp within 2 years of the day on which he discovered the “injury, loss or damage”. Usanovic commenced an action against Penncorp in April 2015, approximately 3.5 years after Penncorp terminated his benefits.

The Arguments and the Decision

In the lower court, Usanovic argued that Penncorp was bound by its duty of good faith to notify him of the limitation period under the Act when it denied his claim. He argued that the limitation period did not begin to run until Penncorp gave such a notice. The motion judge rejected these arguments, stating that (1) the limitation period began to run when Usanovic received Penncorp’s denial letter on January 12, 2012; and, (2) requiring Penncorp to notify Usanovic of this fact would create a “substantial shift” in the boundaries of an insurer’s duty of good faith.
In the Ontario Court of Appeal, Usanovic argued on the basis of consumer protection legislation that the duty of good faith should require insurers to notify insureds of the applicable statutory limitation period. The Court of Appeal upheld the motion judge’s decision. Strathy C.J.O. declined to invoke consumer protection law in this context. He stated that while an insurer’s duty of good faith requires it to “give as much consideration to the welfare of the insured as to its own interests” , this did not rise to the level of a fiduciary duty, wherein the insurer would be required to hold the insured’s interests as paramount to its own interests.
Strathy C.J.O. further held that Usanovic’s proposed expansion of the insurer’s duty of good faith would in essence overrule the discoverability provisions of the Act. If Usanovic’s argument was to stand, then in every case the insurer’s notification of the limitation period would trigger the start of the limitation period, as opposed to the insured’s discovery of his or her loss, injury, or damage. This would bring ambiguity – rather than clarity – to the understanding of the statute.

What Does Usanovic Mean for Insurers in Ontario?
Read More

Once again our partners have been named in the 2018 Canadian Legal Lexpert Directory as Leading Practitioners in Property Development for Toronto and the GTA.
Congratulations to Jeff Davies, Kim Beckman, Mark Flowers and Michael Melling for being recognized as leading lawyers in a competitive marketplace.
To be included in the directory is an honour and acknowledgement of excellence by a practitioner’s own peers and colleagues.