Supreme Court Judgments

Supreme Court of Canada

Homex Realty v. Wyoming, [1980] 2 S.C.R. 1011

Date: 1980-11-12

Homex Realty and Development Company Limited (Respondent) Appellant;

and

The Corporation of the Village of Wyoming (Appellant) Respondent.

1980: February 27; 1980: November 12.

Present: Laskin C.J. and Martland, Ritchie, Dickson, Beetz, Estey and Chouinard JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO.

Municipal law—By-laws—Planning legislation—Subdivision control—Refusal by successor in title to great majority of subdivision lots to carry out provisions of subdivision agreement—Appellant’s lots deemed not to be plan of subdivision by by-law—By-law enacted without notice—Connection between appellant’s water main and municipal water system forbidden by separate by-law until conditions met—Whether or not by-laws should be quashed—Discretionary nature of judicial review—The Planning Act, R.S.O. 1970, c. 349, s. 29—The Interpretation Act, R.S.O. 1970, c. 225, s. 17—The Judicial Review Procedure Act, 1971, 1971 (Ont.), c. 48—The Registry Act, R.S.O. 1970, c. 409—The Municipal Act, R.S.O. 1970, c. 248, ss. 283, 284, 285.

The appellant disputed an order of the Ontario Court of Appeal upholding two by-laws of the respondent municipality. The issues turned on the interpretation of s. 29 of The Planning Act and the jurisdiction or authority of the courts under The Judicial Review Procedure Act, 1971.

As a condition of registration of a plan of subdivision in the Village of Wyoming, Atkinson, the owner and subdivider of the parcel of land, entered into an agreement with the Village for the installation of municipal services in the subdivision. This agreement, dated January 22, 1968, and registered September 26, 1975, provided in a general way for the owner’s providing “all the requirements financial and otherwise, of the Corporation re surfacing of roads, installation of services and drainage”. The agreement also prevented the sale of the lands in question until the agreement had been fully carried out, except with the consent of the Village, but the provision did not provide that consent would operate to release Atkinson from his obligation to the Village. Before any services were installed, Homex bought the great majority of the lots on the subdivision with the Village’s consent. There was some question as to wheth-

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er or not Homex had undertaken to assume the obligations of the original subdivider. Nevertheless, when protracted negotiations between the Village and Homex concerning the installation of services proved fruitless, the Village, in April 1976, pursuant to s. 29(3) of The Planning Act and without notice to Homex, enacted by-law 7 deeming the lots purchased by Homex not to be a registered plan of subdivision. Homex, in September 1976, made application for judicial review for an order quashing by-law 7 and, while the application was pending, checkerboarded its lots.

In November 1975, Homex and the Village negotiated the installation of services along the only street requiring them. By-law 6, enacted in December 1975, provided that it was the policy of the Village that it would neither assume responsibility for a water pipeline constructed by Homex nor permit its connection to the municipal water supply system. Homex coupled an application in judicial review to quash by-law 6 with the application for an order to quash by-law 7.

Held (Ritchie and Dickson JJ. dissenting): The appeal should be dismissed.

Per Laskin C.J. and Martland, Beetz, Estey and Chouinard JJ.: Homex, through its president, undertook to assume the obligations undertaken by the first subdivider under the subdivision agreement. Further, Homex intended to convey the lots as purchased on this subdivision without the installation of any services leaving the expense to the Village and other inhabitants.

Wherever a statute authorized the interference with property or other rights and was silent as to whether or not the agency in question was required to give notice prior to the intervention in such rights, the courts would “supply the omission of the legislature” and require the agency in question to afford the subject an opportunity of being heard before it proceeded. The application by the courts of this old principle depended on the nature of the action being undertaken by a body, such as a municipal council.

The statutory framework, the nature of the action being taken by the Village Council, and the general circumstances prevailing at the time had to be taken into account in determining the appropriate interpretation applicable to s. 29(3) of The Planning Act. The statute did not expressly require notice to the affected landowners; nevertheless, Council was aware that Homex would oppose by-law 7. The by-law had some characteristics of a community interest by-law and also

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represented the purported culmination of an inter partes dispute conducted on adversarial lines between Homex and the Council. Council’s action was not in substance legislative but rather quasi-judicial in character so as to attract the principle of notice and the consequential doctrine of audi alteram partem. The statute did not displace the rule of audi alteram partem and the resultant duty in Council to hear first and decide later. There was no hearing in the formal and ordinary sense by the Council and, while each side was fully aware of the other’s position, Homex did not receive an opportunity to make known its position once fully aware of the Council’s final position.

The order of judicial review, sought with reference to by-law 7, was in the nature of certiorari. The discretionary nature of this remedy is undoubted, and a party may by his conduct disentitle himself to relief. The remedy was denied in the special circumstances of the case: the attempts by Homex to avoid the burden of the Atkinson agreement; the avoidance, through checkerboarding, of Village regulation should the by-laws be invalid; and the fact that the Village’s action, made even more urgent by the litigation possible, was the only course open to it.

There was no basis for quashing by-law 6. The by-law simply recorded an agreement between the Village and the landowner, and announced the Village’s policy with reference to the pipeline. Passage of by-law 6 was not tied to Homex’s disposition of its lands in plan 567 and was not tainted by bad faith.

The form of proceedings taken was free from any deficiency in its statutory base. Either The Judicial Review Procedure Act, 1971 or the quashing provisions of The Municipal Act were open and appropriate.

Per Dickson and Ritchie JJ., dissenting: Where the by-laws in question affected the land or property of specified individuals, the courts implied a common law duty to be heard. This duty was not precluded by implication by the requirement of notification after passage of the by-law.

There was no reason why the Wiswell principle should have been applied restrictively, or why it should not have been applied in this case. The entitlement to notice and a hearing did not depend on there being a conflict between two private owners, which the municipality had to resolve. The right to a hearing did not spring from the

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fact that there were competing groups or individuals, some opposed to the by-law but from the fact that the by-law interfered, in particular, with the private property rights of this one owner.

The public interest was best served by affording the private interest full disclosure and a fair opportunity to be heard. There was no a priori reason why the private interest should yield abjectly to the public interest. The Village could undoubtedly pass the by-law if it were in the public interest, but, prior to deciding in favour of the public interest, the Council should have heard the landowner’s submissions. An act could not be labelled “legislative” for the purpose of dispensing with fairness. Although a sophisticated owner, given prior notice, could “checkerboard” and defeat the intent of the section, it was for the legislature to decide that prior notice was not necessary. Further, the requirement of both prior and subsequent notice was not redundant: the earlier notice permitted representations from those who wished to protest and the subsequent notice informed all concerned of the action taken.

The right to procedural fairness no longer demanded an a priori classification of a process as judicial or quasi-judicial. It was not particularly important that the function of the municipality was classified as “legislative” or “quasi-judicial”. Rather, it was necessary to look at the nature of the function and to the facts of each case. The by-law in question was not of wide and general application, but was rather aimed at deliberately limiting the rights of the appellant, entitling it to some procedural safeguards—at a minimum, notice of the proposed by-law and the opportunity to be heard. The prolonged negotiations between the Village and Homex did not satisfy the onus placed on the Village and did not result in waiver of notice for Homex had been given no indication of the Village’s intention to enact the impugned by-laws.

[Cooper v. Wandsworth Board of Works (1863), 14 C.B. (N.S.) 180; Bishop v. Ontario Securities Commission, [1964] 1 O.R. 17; Re Buhler and Rural Municipality of Stanley (1977), 72 D.L.R. (3d) 447; R. v. Brighton Corporation; Thomas Tilling, Lim., Ex parte (1916), 85 L.J. K.B. 1552; R. v. Liverpool Corporation, Ex parte Liverpool Taxi Fleet Operators’ Association, [1972) 2 Q.B. 299; Welbridge Holdings Ltd. v. Greater Winnipeg, [1971] S.C.R. 957; Re Zadrevec et al. and Town of Brampton, [1973] 3 O.R. 498; Re Hershoran and City of Windsor et al. (1973), 1 O.R. (2d) 291; Alliance des Professeurs catholiques de Montréal v. Commission des Relations ouvrières de la province de

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Québec et al, [1953] 2 S.C.R. 140; Calgary Power Ltd. v. Copithorne; [1959] S.C.R. 24; Re Orangeville Highlands Ltd. et al. v. Attorney General of Ontario and Township of Mono et al. (1975), 8 O.R. (2d) 97; Wiswell et al. v. Greater Winnipeg, [1965] S.C.R. 512; Re Braeside Farms Ltd. et al. and Treasurer of Ontario et al. (1978), 20 O.R. (2d) 541; Re McMartin and City of Vancouver (1968), 70 D.L.R. (2d) 38; P.P.G. Industries Canada Ltd. v. Attorney General of Canada, [1976] 2 S.C.R. 739; Harelkin v. University of Regina, [1979] 2 S.C.R. 561; Cock v. Labour Relations Board (1960), 26 D.L.R. (2d) 127; Re de Havilland Aircraft of Canada Ltd. and City of Toronto (1980), 27 O.R. (2d) 721, referred to.]

APPEAL from a judgment of the Court of Appeal for Ontario[1], allowing an appeal from a judgment of the Divisional Court quashing the municipal by-laws in question on an application for judicial review.

J. Edgar Sexton, Q.C., and Brian Morgan, for the appellant.

Lyle F. Curran, Q.C., for the respondent.

The judgment of Laskin C.J. and Martland, Beetz, Estey and Chouinard JJ. was delivered by

ESTEY J.—The appellant disputes an order of the Ontario Court of Appeal upholding two by‑laws of the respondent municipality being by-laws nos. 6 and 7, passed by the Village Council in 1975 and 1976. The issue turns on the interpretation of s. 29 of The Planning Act, R.S.O. 1970, c. 349, and the jurisdiction or authority of the courts under The Judicial Review Procedure Act, 1971, 1971 (Ont.), c. 48. In relating the essentials of the history of this matter, the appellant is referred to as Homex and the respondent municipality as the Village or the Council.

One Atkinson owned a parcel of land in the Village of Wyoming, County of Lambton, consisting of about 25 acres and in March of 1968 registered a plan of subdivision of that parcel as no. 567 in the Registry Division of Lambton. As a condition of such registration Atkinson entered into an agreement with the Village for the installation of municipal services on the land comprised in

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this subdivision. This agreement was dated January 22, 1968 but was not registered until September 26, 1975 perhaps because it was not until sometime in 1973 that The Planning Act, supra, was amended to provide for the registration of such subdivision agreements and for their enforceability against subsequent owners of the land. This agreement provided in a general way for the provision by Atkinson, the owner, of “all the requirements, financial and otherwise, of the Corporation re surfacing of roads, installation of services and drainage”.

Before any services were installed on this subdivision, Homex entered into an agreement with Atkinson for the purchase of 25 lots on the subdivision and this agreement was performed by the delivery by Atkinson to Homex of a deed to which, pursuant to the subdivision agreement, the Village consented. This deed was registered in May 1973. Atkinson, the vendor, retained three lots on the subdivision. Some time prior to the sale by Atkinson to Homex, Atkinson had conveyed to the Village two lots pursuant to the subdivision agreement. There are two lots on the subdivision owned by third parties not involved in this litigation. There is some dispute as to whether Homex was to be bound by and to perform the subdivision agreement on behalf of Atkinson. In the original documentation filed in the Supreme Court of Ontario there is to be found an affidavit completed by Norman Redick, the president of Homex, and sworn on July 28, 1976 and which affidavit is referred to in the notice of motion for judicial review. In the record filed before this Court, such an affidavit appears and paragraph 4 thereof states in part as follows:

No mention was made in this deed [from Atkinson to Homex] of the assumption by Homex of any of the obligations of Atkinson under the subdivision agreement made by him with the Village nor did Homex assent to any such assumption at such time.

However, in Appendix A of the respondent’s factum, there is set forth a page 2 of an affidavit sworn by the president of Homex and filed before the Divisional Court and the Court of Appeal which states in part as follows:

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4. That by this agreement Homex agreed to assume the obligation of Atkinson under a subdivision agreement made by him with the Corporation of the Village of Wyoming regarding park allowance. A copy of this subdivision agreement was registered against the lands of Homex by the Town Solicitor, William M’Clean Dawson, on September 25, 1975, with registration number 375351.

An examination of the original documentation filed on this appeal in this Court reveals that the affidavit, completed by Redick as president, was filed in support of the application for judicial review in the Divisional Court and forwarded to the Court of Appeal for the hearing of the appeal in the Divisional Court. It sets out as page 2 thereof the excerpt of the affidavit I have copied above from the respondent’s factum. In what appears to be an explanation for this discrepancy, counsel for the respondent in his factum states:

That affidavit [being the excerpt copied above in which Homex agreed to assume at least some of the obligations of the subdivision agreement] was filed by the Appellant’s then solicitor by mistake; however, it is submitted that it is an accurate statement as to Homex’s agreement with Atkinson.

It is strange indeed that what purports to be the original affidavit appended to the originating notice of motion has a retyped page 2 setting forth the affidavit which appears in the record filed in this Court. This page 2 has obviously been typed on a different typewriter, appears in double space as compared to the single spacing of the balance of the affidavit, and the insert alone has been initialled only by the person (signature illegible) who took the affidavit of Mr. Redick. The mystery is deepened by the fact that the jurat does not reveal any date of re‑execution of the affidavit. I have no hesitation in finding for the purposes of disposing of this appeal that the affidavit in support of the application for judicial review was as filed in its original form and, should it become important to the disposition of this appeal, I would without hesitation find that on the record the president of Homex indeed had knowledge of the existence and the content of the subdivision agreement between Atkinson and the Village dated January 26, 1970 and that Homex, through its president, undertook to assume the obligations of Atkinson thereunder.

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I come to this conclusion as regards the entire contents of the agreement notwithstanding the limitation in the offer to purchase of the incorporated terms of the agreement to those regarding the “park allowance”. This handwritten excerpt seems to me to read as follows:

present, subdivision agreement with the Village regards park allowance to be accepted by the purchaser. Wire[?] fence to be erected jointly with the purchaser and vendor.

As to the agreement itself, it was signed on behalf of Homex by Redick who then witnessed his own signature, and finally witnessed the execution of the agreement by the vendor. After the agreement was executed, Homex obtained the consent of the Village on March 23, 1970 to the conveyance of these lands from Atkinson to Homex. In his affidavit of uncertain date, the president of Homex says that “no reference is made in the deed” to the subdivision agreement. However, it hardly can be said that Homex in these circumstances was unaware of the existence of such an agreement. If one need further support for such a conclusion, it is to be found in the affidavit of the vendor, Atkinson, where he says in part that Redick was “well acquainted with the requirements and details” of the agreement before the contract was entered into between Homex and Atkinson; and that it was “clearly understood between him and me before the said contract was made that Homex would be responsible for satisfying the requirements of the Corporation of the Village of Wyoming…”. The affidavit went on to state that for so undertaking the obligations of Atkinson, Homex was accorded a reduction in price of $5,000. This affidavit was not answered by Homex nor was Atkinson cross-examined upon it. The Court of Appeal concluded (and with respect I agree) that Homex knew of the services agreement at the time of the conveyance of the land to Homex. The Divisional Court made no finding on this matter.

The subdivision agreement between Atkinson and the Village entered into prior to the registration of plan of subdivision 567 provided in part:

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The Owner hereby covenants and agrees with the Corporation to satisfy all the requirements, financial and otherwise, of the Corporation re surfacing of roads, installation of services and drainage.

There is no specific reference to the engineering specifications for the work to be done in connection with the installation of roads and services, nor is there any reference to the requirements for park allowances which were referred to in the agreement of sale to Homex. The contract prohibits the sale of any of the lands in question by Atkinson until the agreement has been fully carried out except on the consent of the Village, but such provision does not provide that the consent will operate to release Atkinson from his obligation to the Village.

Before proceeding further with the narrative, it is important to pause and observe that at this stage of events Homex was the owner of all the lots in the subdivision fronting on Norman Street, except two lots which had been conveyed by Atkinson to the Village and two other lots owned by third parties which fronted on another street which had already been serviced, and no issue arises herein with respect to those two lots. The lots retained by the vendor, Atkinson, do not front on Norman Street. The waterline was installed by Homex on Norman Street and the other services and installations mentioned in the subdivision agreement were to be installed on that street but in fact were not so installed.

After the sale to Homex by Atkinson was completed negotiations ensued between the Village and Homex for the installation of services on this plan of subdivision.

These negotiations between Homex and the Village proved abortive although numerous documents were proffered by the Village. In his cross-examination on his affidavit, Redick perhaps reveals the reason why these protracted negotiations came to nought when he stated:

Q. That’s what you really want. Everything to be done on local improvement?

A. I think it should be done that way in this case.

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Q. Yes. That’s your proposal?

A. I think it should be done that way.

If it be relevant to the outcome of these proceedings, the conclusion must be reached from an examination of the record, and particularly the cross-examination of the president of Homex, that Homex had indeed purchased these lands from Atkinson with the intention at the time, or thereafter acquired, of conveying the lots on this subdivision without the installation of any services so as to leave to the Village and the other inhabitants thereof the cost of providing these services on some basis or other, but not at the expense of Homex.

After the negotiations between the parties (which spread over a period of a year and a half) with respect to the installation of services had proved fruitless, the Village, without any notice to Homex, enacted by-law no. 7 on April 1, 1976 pursuant to s. 29(3) of The Planning Act, supra, whereby the parts of registered plan no. 567 indicated in the by-law (and being those lots purchased by Homex)

are hereby designated as parts which shall be deemed not to be a registered plan of subdivision for the purposes of subsection (2) of Section 29 of The Planning Act.

In September 1976 Homex made application by way of judicial review for an order quashing by-law 7. While this application was pending before the Divisional Court, Homex checkerboarded the lots received by it from Atkinson on plan 567. By checkerboarding, reference is made to the procedure discussed in detail in Re Herman et al. and Kalbfleisch et al.[2] and Reference re Certain Titles to Land in Ontario[3] and adopted by conveyancers on occasion in the Province of Ontario to escape the strictures of The Planning Act, supra. By this technique, Homex conveyed to a series of third parties, including Robert C. Redick, Norman C. Redick, Orville A. Redick, Daniel J. Redick, and others, so many lots as were necessary to produce a situation in which neither Homex nor any other single registered owner, other than the vendor Atkinson and the Village, held contiguous

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lots on this plan of subdivision. Thus if by-law 7 be ineffective so that plan of subdivision 567 remains fully registered under The Planning Act, supra, and The Registry Act, R.S.O. 1970, c. 409, then Homex has apparently so arranged its land holdings as to make it immune from further regulations which may be adopted by the Village under The Municipal Act, R.S.O. 1970, c. 284, with regard to the lots held by and for it on plan 567. On the other hand, if by‑law 7 is effective, then the attempt to checkerboard has failed and Homex will be unable to convey, without further permission from the Village, any of its holdings on plan 567. I pause to point out that this rather unusual record is silent as to what declarations of trust, if any, are extant between the registered owners of some of the lots on 567 and Homex. The affidavit of one Catherine Clark Dawson simply sets out the state of the abstract of title as it existed on some date prior to the date her affidavit was taken, being September 6, 1977. The statement is made by the respondent in its factum that the lands were checkerboarded by Homex prior to the hearing of the application by the Divisional Court. This statement remains unanswered by the appellant and I take it, for the purposes of disposing of this appeal, that these lands were indeed so checkerboarded.

Almost as a sidelight to this main activity, Homex and the Village, in November 1975, entered into discussions concerning the installation of a water line on Norman Street which, as already stated, is the only street on the subdivision requiring services, and on which front the lots checkerboarded by Homex. The record contains a letter dated November 7, 1975 from the Village to Norman Redick, presumably in his capacity as president of Homex, answering a letter from him which is not in the record, and advising Redick of a decision reached by the Council of the Village:

in regards to the installation of the 6″ water line and fire Hydrant [sic].

Their decision as follows: “That council reply to the letter from N. Redick, giving him the privelege [sic] of installing a watermain on Norman Street, providing he assures council in writing that no further services are

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installed without signing an agreement with the village; the granting of such privelege [sic] shall in no way constitute a complete subdivision agreement, nor shall it inhibit the reopening of negotiations with Mr. Redick”.

Thereafter the Village Council enacted by-law no. 6 on December 29, 1975 without any further notice to or dealings with Homex in the matter. After a recital of a request by Homex for permission to install a water pipeline on Norman Street, paragraph 2 of by-law no. 6 provides:

2. It is the policy of the Council of the Corporation of the Village of Wyoming that the said water pipe line in Norman Street from Superior Street to approximately the north limit of Lot 7 according to said Plan 567 shall not be assumed or taken over by the Corporation and no connection shall be permitted to be made to the said water pipe line and no water shall be supplied through the said water pipe line and the said water pipe line shall not form part of the municipal water supply system of the Village of Wyoming until authorized by a futher [sic] by-law of the Corporation of the Village of Wyoming.

Homex coupled an application in judicial review to quash this by-law with the application already mentioned for an order quashing by-law no. 7.

Although some of the issues herein raised are common to both by-laws 6 and 7, the larger question arises concerning the latter by-law and I therefore first deal with the validity of by-law no. 7.

The provisions in The Planning Act, supra, relating to the conveyance of land are found in s. 29, of which subss. (2) and (3) are here relevant:

(2) No person shall convey land by way of a deed or transfer, or grant, assign or exercise a power of appointment with respect to land, or mortgage or charge land, or enter into an agreement of sale and purchase of land or enter into any agreement that has the effect of granting the use of or right in land directly or by entitlement to renewal for a period of twenty-one years or more unless,

(a) the land is described in accordance with and is within a registered plan of subdivision; or

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(b) the grantor by deed or transfer, the person granting, assigning or exercising a power of appointment, the mortgagor or chargor, the vendor under an agreement of purchase and sale or the grantor of a use of or right in land, as the case may be, does not retain the fee or the equity of redemption in, or a power or right to grant, assign or exercise a power of appointment with respect to, any land abutting the land that is being conveyed or otherwise dealt with; or

(c) and (d)—not here applicable

(e) a consent is given to convey, mortgage or charge the land, or grant, assign or exercise a power of appointment with respect to the land or enter into an agreement with respect to the land.

(3) The council of a municipality may by by-law designate any plan of subdivision, or part thereof, that has been registered for eight years or more, which shall be deemed not to be a registered plan of subdivision for the purposes of subsection 2.

Subsection (3) does not expressly require notice before the passage of any by-law authorized by the subsection, nor does the terminology of the subsection raise any necessary implication of a requirement of notice. Subsections (8), (9), (10) and (11) may be of some assistance in construing subs. (3), particularly as to whether it requires the giving of notice prior to the passage of a by-law such as by-law no. 7.

(8) A certified copy or duplicate of every by-law passed under subsection 3 shall be lodged by the clerk of the municipality in the office of the Minister.

(9) A by-law passed under subsection 3 is not effective until the requirements of subsections 10 and 11 have been complied with.

(10) A certified copy or duplicate of every by-law passed under this section shall be registered by the clerk of the municipality in the proper registry or land titles office.

(11) The clerk of the municipality shall send by registered mail notice of the passing of a by-law under subsection 3 to each person appearing by the last revised assessment roll to be the owner of land to which the by-law applies, which notice shall be sent to the last known address of each such person.

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Subsection (11) would indicate that the question of notice was of concern to the legislators and perhaps might be construed as indicating that, having expressly considered the question, the only notice prescribed is a notice after the passage of the by-law which, by subs. (9), is a condition precedent to the effectiveness of the by-law.

It should be noted that by an amendment to The Planning Act, supra, brought into effect by 1978 (Ont.), c. 93, s. 2(4), subss. 9 and 11 were repealed and the substituted sections deliberately and expressly provide that a notice is not a condition precedent to the effectiveness of a by-law passed under subs. (3); and a further procedure is prescribed for the hearing of persons who complain within a prescribed time after receipt of notice under subs. (11). Section 17 of The Interpretation Act, R.S.O. 1970, c. 225, provides:

The repeal or amendment of an Act shall be deemed not to be or to involve any declaration as to the previous state of the law.

The courts of course are concerned only with the state of the rights of the parties under the statute as it existed at the time of the passage of the by-law, and accordingly the interpretation of s. 29(3) as it then stood is not affected by subsequent legislative action.

The courts long ago developed the general proposition that wherever a statute authorizes the interference with property or other rights and is silent as to whether or not the agency in question is required to give notice prior to the intervention in such rights, the courts will “supply the omission of the legislature” and require the agency in question to afford the subject an opportunity of being heard before it proceeds: Cooper v. Wandsworth Board of Works[4]; S.A. de Smith, Judicial Review of Administrative Action, 4th ed., at p. 161. Whether or not the courts today will invoke this principle of interpretation may depend upon the nature of the action being undertaken by a body such as a municipal council. There are instances where the omission of the prerequisite notice is not supplied

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by the courts, as, for example, where the statute in question, by its very nature and by the legislative framework there adopted by the Legislature, must be read as precluding the requirement of prior notice. The Ontario Court of Appeal, for example, in Bishop v. Ontario Securities Commission[5], so construed s. 19 of The Securities Act, R.S.O. 1960, c. 363. Roach J.A., in speaking for the Court, stated:

The whole purpose of the Act might be defeated if the chairman could make an order or ruling under that section only on notice to the person or company affected and after a hearing. Many days might elapse between the giving of the notice to the persons or company sought to be affected and the conclusion of the hearing during which time those persons or that company if dishonest and disreputable could continue to prey upon the public and plunder and fleece many people. For that reason it was essential to the purpose of the Act that the chairman should be empowered to act promptly and without notice to the person or company sought to be affected. The chairman’s first duty is to the public and in empowering him to discharge that duty the Legislature has by appropriate legislation at the same time protected the person or company affected by the order by giving to him on it at their election the right to have the order reviewed by the Commission. (at p. 23)

The Planning Act of Manitoba (1975 (Man.), c. 29) contained at the time in question a provision identical to s. 29 (11). Subsequently, the Manitoba statute was amended (1977 (Man.), c. 35, s. 34) to prescribe a notice to affected parties as a condition precedential to the validity of a by-law enacted pursuant to a provision comparable to s. 29(3) of the Ontario statute. The effect of this amendment is precisely the opposite to that of the 1978 Ontario amendment. Prior to the adoption by the Manitoba Legislature of the 1977 amendment, the Court of Appeal in Re Buhler and Rural Municipality of Stanley[6] found that a by-law passed without notice was invalid and therefore quashed, not, however, by reason of the lack of notice but rather on the basis of bad faith in which the courts found the council to have acted.

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In determining the appropriate interpretation applicable to s. 29(3) of The Planning Act, supra, the statutory framework, the nature of the action being undertaken by the Village Council, and the general circumstances prevailing at the time of the action by the Village Council must be taken into account.

The Village Council is, of course, entirely a creature of statute. It derives all its power, its status, its rights as well as its limitations from various provincial legislation of which The Municipal Act, supra, may be said to represent the core. This legislation has assigned a wide range of activities and responsibilities to the municipal council which have been variously categorized by the courts through the years. In some instances the council acts purely as a sub-legislature enacting legislation within the ambit of the authorizing statute for the general governance of the region in respect of which the council is given its statutory authority. In other instances, as for example in the granting or withholding of individual licences pursuant to applications, the courts have classified the municipal activity as “judicial”: R. v. Brighton Corporation; Thomas Tilling, Lim., Ex parte[7], and in so exercising their judicial function

… they are bound to act judicially. It is their duty to hear and determine according to law, and they must bring to that task a fair and unbiased mind. (per Sankey J. at p. 1555)

More recently, in R. v. Liverpool Corporation, Ex parte Liverpool Taxi Fleet Operators’ Association[8], Lord Denning has stated:

It is perhaps putting it a little high to say they are exercising judicial functions. They may be said to be exercising an administrative function. But even so, in our modern approach, they must act fairly: and the court will see that they do so. (at p. 308)

This aspect of municipal law is addressed by Laskin J. (as he then was) in Welbridge Holdings Ltd. v. Greater Winnipeg[9], at pp. 968-969:

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The defendant is a municipal corporation with a variety of functions, some legislative, some with also a quasi-judicial component (as the Wiswell case determined) and some administrative or ministerial, or perhaps better categorized as business powers.

…

A municipality at what may be called the operating level is different in kind from the same municipality at the legislative or quasi-judicial level where it is exercising discretionary statutory authority.

The act of passing by-law 7 is an exercise of the Council’s legislative function. En route to that exercise there may have been a decisional process but that factor does not, in my view, alter the characterization at law of the Council’s action, or append thereto other consequences at law. This problem was examined in Welbridge, supra, at p. 969 where Laskin J. (as he then was) stated:

A narrower basis of liability is, however, proposed in the present case, one founded only on the failure to carry out the anterior procedural requirements for the enactment of By‑law No. 177. Although those requirements were held in the Wiswell case to be expressions of a quasi-judicial function, this did not mean that the hearing to which they were relevant was a step unrelated to the legislative exercise in which the defendant was engaged.

It is clear that the passage of the by-law, if effective, has stripped Homex of its freedom to exercise the right of conveyance given by the provincial planning statute. On the other hand, it is equally clear that the balance of the township, that is to say the local ratepayers, may well be seriously affected by the action of Homex if the latter is successful in avoiding the consequences of the deregistration of plan 567. One effect would appear to be that the other inhabitants would be obligated in theory, or in fact, or both, to service the lots of subdivision 567 as and when they may be occupied by residences. It was submitted by the respondent that the argument of a notice requirement in these circumstances answers itself. The power granted the Village under s. 29(3) would be defeated by the response in fact taken by Homex in checkerboarding its lands prior to hearing of the application to quash. Thus we have the opposing

[Page 1028]

considerations of Wandsworth, supra, and Bishop, supra.

The Ontario Court of Appeal in Re Zadrevec et al and Town of Brampton[10] was concerned with the action of a municipal council which, as here, had failed to give notice to affected parties of proposed by-laws rezoning their lands. Such by-laws, before they could become effective in law, required the approval of the Ontario Municipal Board. Prior to that approval an action was taken under The Municipal Act, supra, to have the by-laws in question declared void. The Court found that the Legislature, by imposing the approval of the Board as a condition precedent to the validity of the by-laws, had removed from the Municipal Council and transferred to the Board

… the judicial process which the council in the absence of such transfer would have been required to discharge. (per Kelly J.A. at p. 504);

and continuing at p. 507:

It is my opinion that the Legislature has indicated its intention that the other provisions it has made relieve the Council of the obligation to act judicially in adopting the amendment to the official plan and that Council, being aware that the procedure it was following would result in an opportunity for all parties to be heard by the Board and of the Board to exercise its judgment, was relieved of the obligation to act judicially as it would have been required to do if the Legislature had not made such other provisions. Consequently, there was no denial of natural justice in the action of Council and the by‑law adopting the amendment is not liable to be declared void on that account.

In somewhat similar circumstances a municipality was required by the courts to give notice prior to the enactment of a by-law which rendered forfeit the right of redemption by the payment of arrears of taxes: Re Hershoran and City of Windsor et al.[11] The statute was silent as to notice but the Divisional Court found that the city council lost jurisdiction on failing to notify the landowner of its impending action by by-law and hence the by-law was quashed. It is interesting to note that the by-law in question was subject to confirmation

[Page 1029]

prior to its effectiveness by the Minister of Municipal Affairs and the Court likewise quashed the Minister’s purported approval of the by-law on the grounds that the Minister had failed to take into account the position of the landowner in the circumstances there prevailing. The Court, speaking through Hughes J., appears to have found that the council, in the exercise of its discretion in electing to designate the lands in question as park lands with the inevitable extinction of the rights of the owner in those lands, was acting in a quasi-judicial manner within the contemplation of the judgment of this Court in Alliance des Professeurs catholiques de Montréal v. Commission des Relations ouvrières de la province de Québec et al.[12], rather than in an administrative capacity as that function was determined to be in law by this Court in Calgary Power Ltd. v. Copithorne[13]. The opposite result to that in the Zadrevec case, supra, was reached by the same court in Orangeville Highlands Ltd. et al. v. Attorney General of Ontario and Township of Mono et al.[14], but presumably on the basis that the ministerial order therein under review was final and not subject to Ontario Municipal Board approval. The Court there found that a zoning order affecting the property rights of the applicant and issued without notice to it was without effect in law. In the result, in was held that the ministerial order imposing provincial zoning was the exercise of a power comparable to that of a municipal council and that the order, not being subject to review elsewhere, must be taken to the exercise of a judicial or quasi-judicial function and consequently was invalid on the absence of notice to the affected owners. Superficially there may appear to be a conflict between this decision and that of the Ontario Divisional Court in Re Braeside Farms Ltd. et al. and Treasurer of Ontario et al.[15] where no notice was required on the part of the Minister when promulgating regulations under The Niagara Escarpment Planning and Development Act, 1973, 1973 (Ont.), c. 52. The Court there, however, found that the Minister, by adopting a regulation affecting a wide area comprising

[Page 1030]

many different owners of land, was acting in a purely legislative capacity. The British Columbia Court of Appeal in Re McMartin and City of Vancouver[16] classified the action of city council as being legislative where that council was adopting a general zoning by-law applicable to a wide region of the municipality. The statute prescribed a public hearing precedent to the adoption of such a by-law, and after the public hearing was held, the city council received additional representations from individual owners. The majority of the Court, by classifying the general zoning by-law as legislative rather than judicial or quasi-judicial, found no duty in council to do more than conduct the first general hearing, which it did, and no right arose in any affected landowners by reason of the reception by council thereafter of additional representations.

This Court, in Wiswell et al. v. Greater Winnipeg[17], was required to classify the action taken by the Council of the City of Winnipeg when adopting a by-law rezoning a specific piece of property. The Court found the action by the municipal council to be quasi-judicial in nature and hence were required to give notice to those property owners affected by the proposed action. The statute prescribed certain forms of notice which were not followed. This Court quoted with approval the remarks by Freedman J.A. (as he then was) in the Court of Appeal:

In proceeding to enact By-law No. 177 Metro was essentially dealing with a dispute between Dr. Ginsburg, who wanted the zoning requirements to be altered for his benefit, and those other residents of the district who wanted the zoning restrictions to continue as they were. That Metro resolved the dispute by the device of an amending by-law did indeed give to its proceedings an appearance of a legislative character. But in truth the process in which it was engaged was quasi-judicial in nature; and I feel I must so treat it. (at p. 520)

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Later in his judgment, Hall J., at p. 522, adopted the observations of Masten J.A. in Re Howard and City of Toronto[18] at p. 576:

In dealing with a proposed by-law which involves a conflict of interests between private individuals who are affected, the council, while exercising a discretion vested in it by statute, acts in a quasi-judicial capacity… and its preliminary investigations and all subsequent proceedings ought to be conducted in a judicial manner, with fairness to all parties concerned.

In the end Hall J. concluded (at p. 523):

It was not merely the failure to post the placards but the manifest ignoring of the fact known to it that the Association would oppose the by-law…

Here we have the circumstance that the statute does not expressly require notice to the affected landowners. Council, of course, was aware that Homex would oppose such a by-law as no. 7. The by-law had some characteristics of a community interest by-law, as in the Hershoran case, supra, but it also represented the purported culmination of an inter partes dispute conducted on adversarial lines between Homex and the Council. As in Hershoran and in Wiswell, supra, I would conclude that the action taken by the Council was not in substance legislative but rather quasi-judicial in character so as to attract the principle of notice and the consequential doctrine of audi alteram partem, as laid down by the courts as long ago as in Wandsworth, supra. On this branch of the case all that remains is to determine whether the statutory pattern leaves this judicial principle available or is it an instance for the adoption of the principles applied in Bishop, supra, by Roach J.A. The statute requires the filing of a copy of such a by-law as by-law no. 7 with the Minister and, in order to be effective, the by-law must be registered in the Registry Office and mailed to the registered owner of the lands affected. I draw no inference from such provisions that no prior notice may be required where the action in question is essentially inter partes and quasi-judicial in nature. Thus the statute does not displace, in my view, the very old rule of audi alteram partem and the resultant duty

[Page 1032]

in Council to hear first and decide later. Such a conclusion is facilitated by the further feature in this case that Council has acted as the judge of its own actions in determining the outcome of the dispute between itself and Homex with reference to the provision of services to subdivision 567.

But that is only part of the journey. Next it must be determined whether in fact Homex was “heard” by the Council. There was of course no ‘hearing’ in the formal and ordinary sense by the Village of the position of Homex. There had, however, been a full awareness by both sides of the position of the other in this dispute. There had been detailed negotiations and an exchange of correspondence on the subject of the subdivision agreement and the installation of services on the lands included in the subdivision. The last letter was sent by the Village to Homex on March 23, 1976 and which letter stated in part:

If you wish to proceed, please advise us and arrange for your Professional Engineers to submit their proposals for the development to the Village’s Engineers for their examination and their report to the Council.

Any such agreement would of course also require that the present action against the Village of Wyoming be dismissed and that the Village be reimbursed for its expenses in connection with that action.

The by-law was passed on April 1, 1976. One can hold no reasonable doubt that Homex had had every opportunity to explain its refusal to install services on the subdivision. The Village had made known to Homex its requirements for servicing. Homex held the view, however, that services should be paid for by the ratepayers in the Village generally and not by the owner of lands remaining to be serviced in this subdivision. Homex, however, did not receive an opportunity to assess its final position on this matter in the face of any action such as that taken by the Village in the passage of by-law no. 7. In the full and final sense Homex did not receive an opportunity to make known its position once fully aware of the Village’s final position. In the light of the conduct of Homex and the attitude of its principal officer, one reaches this

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conclusion with reluctance and only on the most narrow and technical grounds.

We come then to the last substantive test. Having thus determined that Homex had the right to an opportunity to be heard and that Homex did not receive such an opportunity before the passage by the Village of by-law no. 7, is Homex in all these circumstances entitled to the remedy sought, that is the quashing of the by-law on judicial review? These proceedings are brought under The Judicial Review Procedure Act, 1971, supra. The procedure on this application is that formerly available under the Rules of Court where an application was made for an order in lieu of certiorari. The statute in s. 2(5) preserves the discretion of the Court under the former procedure:

Where, in any of the proceedings enumerated in subsection 1, the court had before the coming into force of this Act a discretion to refuse to grant relief on any grounds, the court has a like discretion on like grounds to refuse to grant any relief on an application for judicial review.

The discretionary nature of the remedy is undoubted: vide Laskin C.J. in P.P.G. Industries Canada Ltd. v. Attorney General of Canada[19], at p. 749, where the Court exercised its discretion to deny certiorari to an applicant otherwise in law entitled. The matter was again examined in this Court in Harelkin v. University of Regina[20], per Beetz J. at pp. 575-6:

The use of the expression ex debito justitiae in conjunction with the discretionary remedies of certiorari and mandamus is unfortunate. It is based on a contradiction and imports a great deal of confusion into the law.

Ex debito justitiae literally means “as of right”, by opposition to “as of grace” (P.G. Osborne, A Concise Law Dictionary, 5th ed.; Black’s Law Dictionary, 4th ed.); a writ cannot at once be a writ of grace and a writ of right. To say in a case that the writ should issue ex debito justitiae simply means that the circumstances militate strongly in favour of the issuance of the writ rather than for refusal. But the expression, albeit Latin, has no magic virtue and cannot change a writ of grace

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into a writ of right nor destroy the discretion even in cases involving lack of jurisdiction.

Certiorari was there refused because other remedies had been available but not pursued by the applicant. The principles governing the exercise of discretion to decline the grant of the extraordinary remedy of certiorari are gathered in Halsbury, 4th ed., vol. 1, at p. 157, para. 162: including, from the point of view of this appeal, “… if the conduct of the party applying has not been such as to disentitle him to relief.”. Examples of such conduct are found (in addition to those already enumerated above) in F. Hoffman-LaRoche & Co. A.G. and others v. Secretary of State for Trade and Industry[21]; Watson v. Northern School Board et al.[22], where the applicant had breached a contract and then sought to quash an award by a board established to determine the financial entitlements of the applicant as a result of such breach; Re Falconbridge Nickel Mines Ltd. and United Steelworkers of America[23], where the judge of first instance refused certiorari because the applicant had acted unconscionably during the proceedings before the administrative tribunal. The Court of Appeal, adopting the same general principles of law, found that on the facts the applicant was not guilty of disentitling conduct[24].

I recognize that there has been some criticism of this exercise of judicial discretion to deny the remedy, which criticism has generally viewed the discretion as an attempt by a court to apply or impose its own code of morality. This observation, however, denies or overlooks the very history of certiorari, an extraordinary and discretionary remedy coming down to present day courts from ancient times. To say that the writ is universally available where the rights of an individual are adversely affected by action of some public authorities taken in excess of jurisdiction or in some circumstances where an error of law has been committed in the course of the exercise of its

[Page 1035]

jurisdiction, is not to say that the reviewing tribunal must slavishly apply the rules surrounding the issuance of certiorari and automatically respond to the application of the person affected without any further scrutiny. The principles upon which certiorari, and now the modern order in judicial review, have been issued have long included the principle of disentitlement where a court, because of the conduct of the applicant, will decline the grant of the discretionary remedy.

Certiorari is, of course a prerogative writ originating in the earliest times as a discretionary power of the royal courts in the control of lesser tribunals in the jurisdictional sense. As said by the learned author of S.A. de Smith, Judicial Review of Administrative Action, 4th ed., 1980, at p. 587:

Certiorari was essentially a royal demand for information…

From the dawn of its use, which is said to be in the mid-1200’s, the courts have been concerned with:

… maintaining the principle that writs closely associated with the rights of the Crown should not issue out of the Chancery to the subject as of course. (de Smith, supra, at p. 586)

The learned author of Wade, Administrative Law, 4th ed., 1977, in referring to certiorari and other prerogative remedies, described them as:.

… discretionary and the court may therefore withhold them if it thinks fit. [at p. 560];

and later in the discussion stated:

The discretion to withhold remedies against unlawful action may make inroads upon the rule of law, and must therefore by exercised with the greatest care. In any normal case the remedy accompanies the right. But the fact that a person aggrieved is entitled to certiorari ex debito justitiae does not alter the fact that the court has power to exercise its discretion against him, as it may in the case of any discretionary remedy. This means that he may have to submit to some unlawful administrative act which is ex hypothesi ultra vires. For, as has been observed earlier, a void act is in effect a valid act if the court will not grant relief against it.

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While the writ of certiorari has been replaced by statute in the United Kingdom in 1938 by an order in the nature of certiorari and in some provinces in the Rules of Court for orders in lieu of certiorari; and in other provinces by the statutory procedures sometimes described as judicial review, the courts have continued to apply the principles of the ancient prerogative writ to the newer forms of the same remedy. There are many examples to which one can turn. The British Columbia Court of Appeal in Cock v. Labour Relations Board[25] reversed an order of the court below quashing, by certiorari, an award by a labour relations board, and in doing so stated through Davey J.A., at p. 129:

While the point was not taken below, in my respectful opinion, these writs should not be granted, even upon grounds otherwise legally sufficient, to applicants who in the matters before the Board have committed the fraud, trickery, and apparently perjury, found against the respondents here.

It is to be noted that the Court there regarded the discretion to be one springing not from the adversarial position of the parties but from the reponsibility of the Court in the administration of superior court review to match the application of the extraordinary remedy to the circumstances of each case. Other authorities to the same point are Ex parte Fry[26], at p. 737; The King v. General Commissioners for the Purposes of the Income Tax Acts[27], at p. 519; The King v. Williams[28], at p. 614, as to the exercise of discretion in the first instance. Thus it will be seen that the governing principles surrounding the issuance or withholding of the extraordinary remedy of certiorari in old or modern form operate up through the levels of the superior courts. Indeed, it is incumbent upon all courts to apply those principles where the circumstances so require whether or not the parties

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address themselves to the latter.

Turning now to the application of this principle to the circumstances of this appeal, I do not propose to repeat but merely refer back to the history of the dealings by Homex with its predecessor in title Atkinson, and with the Village. Homex has sought throughout all these proceedings to avoid the burden associated with the subdivision of the lands comprised in plan 567. In the preliminary stages of this application for judicial review, Homex has taken inconsistent and even contradictory positions. Examinations on affidavits were protracted because of a lack of simple frankness on the part of its president. Homex has sought, after its application to this Court to set aside the by-law, to put its lands beyond the reach of municipal regulations by means of checkerboarding. This it apparently is entitled to do at law but it does not follow that the exercise of such a legal right may not be a factor for assessment by a court which Homex invites to exercise a discretion in its favour in connection with certiorari or now judicial review concerning by-law 7. Of primary concern in my view is the attempt by Homex to avoid the burden of the “Atkinson” agreement to service these lands by shifting that burden to the ratepayers in the Village by the undoing of the municipal action taken in the form of by‑law 7. There is nothing in the Council’s conduct of negotiations to indicate the presence of any motive in Council other than its desire to protect its constituents from an expense which had been undertaken by the owners of plan 567 when seeking the right to subdivide their land. This objective the Village had facilitated first by entering into a subdivision agreement with the then owner Atkinson, and thereafter by consenting to a conveyance of the subdivided lands to the applicant Homex. Furthermore, Homex appears to be secure against other forms of action for the recovery of the cost of services by the Village. It is not a party to the Atkinson-Village agreement and the agreement could not be registered and did not therefore run with the land at the time of the Homex acquisition. It might be that the Village could prove prior notice and somehow overcome want of privity in an action on the agreement. But Homex erected

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another obstacle in the path of the Village by resorting to checkerboarding in December 1976. Such litigation by the Village would be difficult, no doubt protracted as were these proceedings, expensive, and of doubtful outcome. In any case, Homex and its “nominees” on title might, in the meantime, have disposed of the land and the Village would be left submerged in litigation with the new owners over the cost of services. Indeed, there is presently at least one outstanding action brought against Homex by a purchaser in which the Village is a third party.

I would, by reason of these special circumstances, deny the issuance of the order of judicial review with reference to by-law no. 7. In doing so it is reassuring to note that a like conclusion was reached by the Ontario Divisional Court in similar circumstances in Re Bergin et al. and Township of King[29], citing in its reasons the judgment of Anglin J. (as he then was) in Rodd v. County of Essex[30], at p. 143. While these authorities concern the discretion to withhold the writ on a mandamus application, the same sort of circumstances were examined as here.

I return now to by-law no. 6 being the by-law passed in December 1975 relating to the installation of a water main on Norman Street. The applicant seeks the quashing of by-law 6 on the grounds “that the by-law was passed in bad faith and for the purpose of preventing the applicant from proceeding with the development and sale of its lands in the said registered plan”. The following is the by-law in its entirety:

A by-law concerning a water pipeline on Norman Street.

WHEREAS the Council of the Corporation of the Village of Wyoming was requested by Norman C. Redick to give him permission to install a water pipe line on Norman Street according to Registered Plan Number 567 in the Village of Wyoming from Superior Street to approximately the north limit of Lot 7 according to said Plan 567.

[Page 1039]

AND WHEREAS Norman C. Redick represented to the Council that the immediate installation of the said water pipe line by him would save him money in connection with the development of the land owned by Homex Realty and Development Company Limited in the said Plan of Subdivision and as a courtesy to him but without making any other commitments, the Council by resolution consented to the installation of the said pipe line but made no commitment as to when the said pipe line might be assumed or taken over by the Corporation or when it could be used for the supply of water.

NOW THEREFORE the Council of the Corporation of the Village of Wyoming enacts as follows:

1. The lands affected by this by-law are Lots 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30 and Norman Street according to Registered Plan 567 in the said Village of Wyoming.

2. It is the policy of the Council of the Corporation of the Village of Wyoming that the said water pipe line in Norman Street from Superior Street to approximately the north limit of Lot 7 according to said Plan 567 shall not be assumed or taken over by the Corporation and no connection shall be permitted to be made to the said water pipe line and no water shall be supplied through the said water pipe line and the said water pipe line shall not form part of the municipal water supply system of the Village of Wyoming until authorized by a futher [sic] by-law of the Corporation of the Village of Wyoming.

By-law 6 is of much less importance to the parties because whether or not there be a by-law concerning this pipeline, there is in the circumstances disclosed a contract between Homex and the Village in which the terms on which the water line was installed are set out in correspondence between the parties. It is trite law that a municipality may act only by by-law and in any case only within its statutory jurisdiction. By-law 6 does not purport to make a general rule applicable to the municipality as a whole, nor does it purport to grant or withhold any rights or privileges in respect of the municipality or its inhabitants. It simply records an agreement between the Village and the landowner and announces the policy of the Village with reference to the pipe line, namely that without further by-law action, the water main shall not form a part of the municipal water supply system.

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The applicant alleges bad faith. There is no finding of bad faith in either court below and nothing in the record would support any such finding. The second ground alleged by the applicant Homex is that by-law 6 was enacted “for the purposes of preventing the applicant from proceeding with the development and sale of its lands in the said registered plan”. There is, of course, nothing in the by-law, including its recitals, which would indicate any such purpose. There is no finding in either court below of any such purpose and again nothing in the record ties the action of the Village in the passage of by-law no. 6 to the disposition by Homex of its lands in plan 567.

The Divisional Court, speaking through Anderson J., stated:

… it is not entirely clear to me what, if any, is its legal effect. Indeed, since it lacks any enacting language, it is questionable whether it can be said to be a by-law at all.

The Court then went on to quash by-law 6 “simply because it is not a by-law”.

The Court of Appeal, after pointing out that s. 15 of The Public Utilities Act, R.S.O. 1970, c. 390, authorized a council on the application of a property owner to provide for the construction of water mains and to provide for the payment of the cost thereof, found that the by-law was a proper exercise by Council of one of its functions. The Court, speaking through Weatherston J.A., stated:

It is apparent from the recitals in By-law No. 6 that the consent of council to the installation by Homex of a water line on Norman Street was given by Resolution only. I see nothing wrong in that Resolution being confirmed by the by-law to conform with the statute and, by registration of the by-law, to give notice to subsequent owner of the lots in the subdivision of the terms on which the consent of council was given. This is not a case of a mere assertion of facts, as was the case in Rogers and Pyke v. The Township of North York et al, [1951] O.R. 79. Its real purpose is clear, and it ought not to be quashed merely because of imperfections in its form.

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I am in respectful agreement with the conclusion reached by the Court of Appeal, namely that there was no basis for the quashing of by-law 6. This result happens to coincide with the practice of the courts of Ontario where they have refrained from quashing by-laws which do no more than announce policy: vide Re de Havilland Aircraft of Canada Ltd. and City of Toronto[31].

One last point is raised regarding the form of this proceeding brought, as has been said, under The Judicial Review Procedure Act, supra. It was alleged that such relief as that sought here should be pursued under the quashing provisions found in ss. 283-5 of The Municipal Act, supra. The courts of Ontario have frequently considered this matter as for example In Re Maurice Rollins Construction Ltd. and South Fredericksburg[32]; Serre et al. v. Town of Rayside-Balfour[33]; Re Holmes et al. and Regional Municipality of Halton[34]; Rose v. Township of West Wawanosh et al.[35]; Re Clements & Toronto[36] and Sutherland v. Municipal Council of The Township of East Nissouri[37].

I am in respectful agreement with Cory J. in Holmes, supra, that both avenues, that is The Municipal Act, supra, and The Judicial Review Procedure Act, supra, are open and appropriate. In any case, there is nothing in The Judicial Review Procedure Act, supra, to indicate a legislative intent that it supercede or be subservient to The Municipal Act, supra. Therefore, the form of proceedings here is free from any deficiency in its statutory base.

I therefore would dismiss the appeal with costs.

The reasons of Ritchie and Dickson JJ. were delivered by

DICKSON J.—Two by-laws were passed by the respondent municipality which directly and adversely affected lands owned by the appellant,

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Homex Realty and Development Company Limited. The by-laws were passed without prior notice and without affording Homex an opportunity to be heard. The question in this case is whether the by-laws are valid.

I

The controversy has its genesis in a fundamental disagreement between the respondent Village of Wyoming and Homex, a land developer, as to who will bear the cost of servicing a subdivision of some twenty-two acres of land.

On January 22, 1968, a subdivision agreement was entered into between the Village and one Atkinson, under the terms of which Atkinson was required to satisfy all the requirements of the Village, financial and otherwise, with respect to surfacing of roads, installation of services, and drainage. The subdivision agreement was not registered until some years later, on September 26, 1975. A plan of subdivision, however, was registered as plan No. 567 on March 26, 1968.

In January 1970, the appellant, Homex, acquired from Atkinson the lands included in plan No. 567. As required by the terms of the subdivision agreement, the consent of the Village was asked for, and given. Unfortunately for the Village, the form of consent did not embody therein an undertaking on the part of Homex to carry out the obligations of Atkinson, nor was Homex a party to the consent. Homex claims that all services necessary to develop the lots in the plan of subdivision were to be handled by Atkinson. Atkinson denies this. Though it is far from clear, resolution of this question is not here in issue. Nor is it necessary for this Court to decide whether Homex did, or did not, have notice of the existence or terms of the subdivision agreement at the time it purchased. Vis à vis the Village, Homex has taken the position that, as a stranger to the Village-Atkinson agreement, it is not bound thereby. The Village, on the other hand, is most unwilling to leave its ratepayers out of pocket for the substantial costs of servicing it feels Homex should bear. Protracted negotiations ensued between the

[Page 1043]

Village and Homex in an attempt to reach agreement on the servicing but no accord was reached. The president of Homex, Norman C. Redick, has been somewhat intransigent throughout.

A draft plan of work prepared for Homex by a land surveyor was rejected by the Village in early 1975. A schedule of work prepared for Homex by professional engineers was later rejected. A draft servicing agreement, acceptable to the Village, was repudiated by Homex. In late 1975, Homex, with the permission of the Village, installed a water main to service some of the lots, but the Village shortly thereafter sought an injunction to halt work at the site claiming Homex had commenced construction of a road not authorized by the Village. The injunction application did not proceed. Nor did the road.

Without notice to or knowledge of Homex, the Village on December 29, 1975 passed by-law no. 6, which reads:

WHEREAS the Council of the Corporation of the Village of Wyoming was requested by Norman C. Redick to give him permission to install a water pipe line on Norman Street according to Registered Plan Number 567 in the Village of Wyoming from Superior Street to approximately the north limit of Lot 7 according to said Plan 567.

AND WHEREAS Norman C. Redick represented to the Council that the immediate installation of the said water pipe line by him would save him money in connection with the development of the land owned by Homex Realty and Development Company Limited in the said Plan of Subdivision and as a courtesy to him but without making any other commitments, the Council by resolution consented to the installation of the said pipe line but made no commitment as to when the said pipe line might be assumed or taken over by the Corporation or when it could be used for the supply of water.

NOW THEREFORE the Council of the Corporation of the Village of Wyoming enacts as follows:

1. The lands affected by this by-law are Lots 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, and Norman Street according to Registered Plan 567 in the said Village of Wyoming.

[Page 1044]

2. It is the policy of the Council of the Corporation of the Village of Wyoming that the said water pipe line in Norman Street from Superior Street to approximately the north limit of Lot 7 according to said Plan 567 shall not be assumed or taken over by the Corporation and no connection shall be permitted to be made to the said water pipe line and no water shall be supplied through the said water pipe line and the said water pipe line shall not form part of the municipal water supply system of the Village of Wyoming until authorized by a futher [sic] by-law of the Corporation of the Village of Wyoming.

All of the lots affected by the by-law and mentioned in paragraph 1 are owned by Homex, with the exception of lots 19 and 20.

On March 3, 1976 Homex wrote to the Village outlining the services Homex was willing to provide.

On March 23, 1976 the Village wrote Homex advising that the Village had always been and continued to be prepared to enter into an agreement with Homex concerning services. The letter outlined the requirements of the Village and concluded:

If you wish to proceed, please advise us and arrange for your Professional Engineers to submit their proposals for the development to the Village’s Engineers for their examination and their report to the Council.

Without awaiting a response to the invitation to continue negotiations, the Village, on April 1, 1976, again without notice to Homex, passed by-law No. 7. The by-law was given three readings in one evening. It reads in part:

1. The parts of Registered Plan No. 567 for the County of Lambton in the Village of Wyoming described in Section 2 of this By-Law are hereby designated as parts which shall be deemed not to be a registered plan of subdivision for the purposes of sub‑section 2 of Section 29 of The Planning Act.

The lots affected by-law No. 7 were the same as those affected by by-law No. 6. By-law No. 7 refers to, and was stated to be passed pursuant to, s. 29(3) of The Planning Act, R.S.O. 1970, c. 349, which provides that the council of a municipality may by by-law designate any plan of subdivision, or part thereof, that has been registered for eight

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years or more, which shall be deemed not to be a registered plan of subdivision for the purposes of s.29(2) of The Planning Act.

It will be recalled that the plan of subdivision had been registered on March 26, 1968. Thus, one week after the expiry of the eight years the Village moved, without notice to Homex, to deem the plan not to be a registered plan. The practical effect is to deny Homex the right to sell any of its lands unless a new plan is registered or a consent of the Committee of Adjustment of the municipality obtained for each conveyance. As no doubt intended, the Village has effectively frozen the property of Homex by passing the impugned by-laws. The lands have been seriously and adversely affected, both as to disposal and as to value. The hurried actions on the part of the Village, behind the back of Homex, taken with a view to providing the Village with a weapon with which to strike Homex in the servicing negotiations, could well be characterized as “shabby”.

Homex commenced proceedings for judicial review. The Divisional Court quashed the by‑laws. By-law No. 6 was invalid on the ground that it was not a by-law at all. Though there had been no bad faith giving rise to the enactment of by-law No. 7 it had been passed for an indirect or improper purpose. “Its purpose had nothing to do with planning which was the legislative area in which council purported to find its jurisdiction.”

The Court of Appeal reversed. With respect to by-law No. 6, the Court found that the by-law was not merely a recitation of facts, as in Rogers and Pyke v. The Township of North York et al.[38] Its purpose was clear and it ought not to be quashed for imperfections in form. With respect to by-law No. 7, the Court found it was passed for a perfectly valid planning purpose, namely, to ensure that the costs of installing municipal services would be borne by the owners of the lots in the subdivision and not by the ratepayers in the municipality. The

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Court held that the Village had no duty to give prior notice to Homex before passing the by‑law; the Council was exercising a legislative function when it enacted the by-law, and the over-riding consideration was the public interest of the citizens of Wyoming. This was not a case such as Wiswell v. Greater Winnipeg[39] in which a municipal council was merely adjudicating on the merits of competing private interests.

In the result, the Court of Appeal upheld the validity of the by-laws and set aside the order of the Divisional Court.

II

There is, of course, a long line of authority which establishes that before a public body can limit or abrogate the property rights of citizens, it must first give the individuals concerned an opportunity to be heard. This principle, of universal application, was established in the case of Cooper v. Wandsworth Board of Works[40]. Nor is it necessary for the legislature to provide explicitly for a hearing for a court to imply such right. On the contrary, where statutory bodies seek to limit property rights, the courts will imply a right to be heard unless there is an express declaration to the contrary: Alliance des Professeurs catholiques de Montréal c. Commission des Relations ouvrières de la province de Québec et al.[41] at p. 154. As Kerwin J., as he then was, noted in that case, the legislature must be presumed to know that notice is required by the general rule. And it is therefore necessary for it to use explicit terms in order to absolve from the necessity of giving notice. See also Re Watt and Registrar of Motor Vehicles[42].

Courts have on numerous occasions applied these principles to the case of a municipal corporation. See In Re Maurice Rollins Construction Ltd.

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and Township of South Fredericksburgh[43]; Re Zadrevec and Town of Brampton[44]; Re Hershoran and City of Windsor et al.[45]; Re Anzil Construction Ltd. et al. and Township of West Gwillimbury et al.[46]; Re Multi-Malls Inc. and Attorney-General for Ontario et al.[47]

Where the by-laws in question directly affect the land or property of specified individuals, the courts have implied a common law right to be heard. In the present case, the Village passed two by-laws which directly and detrimentally affected the lands of Homex and, virtually, only the lands of Homex. It did so without serving any notice of its intentions. One would have thought, on the basis of the authorities, that this was a classical case in which to import rules of natural justice.

The Village advances several arguments in justification of its failure to give notice and to grant a hearing. These include: (i) the common law right to be heard, if it exists, has been statutorily excluded by s. 29(11) of The Planning Act; (ii) in passing the by-laws, the municipality was exercising a legislative function, to which no common law right to be heard applied; and (iii) even if a common law right of fairness does apply here, the municipality has statisfied the onus placed upon it.

Statutory Exclusion of a Hearing

The combined effect of s. 29(9) and s. 29(11) of The Planning Act is that a by-law passed under s. 29(3) of the Act is not effective until notice of the by-law has been sent to each owner of land to which the by-law applies. Section 29(11) reads:

(11) The clerk of the municipality shall send by registered mail notice of the passing of a by-law under subsection 3 to each person appearing… to be the owner of land to which the by-law applies…

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It is contended by the Village that the legislature considered and rejected, impliedly, a requirement of prior notice. The argument is that the requirement of notification after passage of the by-law precludes by implication, any further requirement of prior notice. This argument was accepted by the Court of Appeal. With great respect, I cannot accept it, in light of the consistent line of high authority which holds that an express statutory statement is required before a common law right to a hearing can be excluded. Much more explicit language than that contained in s. 29(11) would be required before the Court could negate the right to a hearing. Section 29(11) does not provide for a hearing, it is merely ex post facto advice as to action taken.

The view that s. 29(11) does not exclude prior notice and a hearing was adopted by Thompson J. in the Rollins case and I am content to repeat what was said in that case:

It is contended… that because s-s. (11) of s. 29… provides that notice of the passing of the by-law must subsequently be given to all owners of land… that the intent of the statute is that prior notice need not be given. I am unable to accede to that contention. That is an entirely different notice which can in no way affect or alter the finality of the by-law as passed. The subsequent notice… was given… It was then too late for it to make representations or to be heard as the by-law had then become effective. (at p. 431)

The section 29(11) argument is not persuasive.

A “Legislative” Function?

In the Court of Appeal, emphasis was placed on the ‘legislative’ character of the acts performed by the Village of Wyoming in this case. It was on this basis that the present facts were distinguished from the case of Wiswell, supra. In Wiswell, the municipality was essentially dealing with a dispute between one Ginsburg, who wanted certain zoning requirements altered for his benefit, and those other residents of the district who wanted the zoning restrictions to continue unchanged. As such, the municipality in Wiswell was said to be acting in a judicial or quasi-judicial capacity. The Court of Appeal held that in the present case, the

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nature of the dispute is different; the municipality is dealing with a matter of public interest—namely, who would bear the cost of servicing; the function is legislative in nature and no right to a hearing can be implied.

I find myself unable to accept the Court’s exegesis.

First, the distinction sought to be made here is that there is no conflict between the competing interests of private individuals, but a question of public interest, pure and simple. That being so, the Village exercised a legislative function in passing by-laws No. 6 and 7. A sale of unserviced lands puts the burden of development on the municipality, which is entitled to prevent that result by enactment of a s. 29(3) by-law.

As counsel for the appellant correctly points out, this reasoning leads to anomalous results. Thus if there were two identical by-laws, each affecting only one particular piece of property, and one by-law was opposed by other private individuals or groups but the other was not, only one of the two owners would be entitled to a hearing.

The right to a hearing does not spring from the fact that there are competing groups or individuals, some of whom happen to be opposed to the by-law. It results from the fact that the by-law interferes, in particular, with the private property rights of this one owner.

Counsel for Homex stresses, rightly in my view, the thrust of the Wiswell decision, which is that those potentially affected in their property rights by a proposed by-law concerning particular property, are entitled to notice of the hearing. If in Wiswell, ratepayers opposing the re-zoning were to be given notice and a hearing, a fortiori property owners should not have their rights tampered with, with no notice given, whether or not there is another private interest in opposition to the by-law.

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For my own part, 1 see no reason why the Wiswell principle should be restrictively interpreted, or why it should not be applied in this case. The entitlement to notice and a hearing should not depend on there being a conflict between two private owners, which the municipality has to resolve. There were no competing interests in Ridge v. Baldwin and others[48]. The question was whether a policeman should be dismissed. See also Nicholson v. Haldimand-Norfolk Regional Board of Commissioners of Police et al.[49]

Second, the presence of a compelling public interest does not alone abrogate or diminish a citizen’s right to procedural protection. The private property interests of Homex were here at stake. The public interest, it seems to me, is best served by affording the private interest full disclosure and a fair opportunity to be heard. There is no a priori reason why the private interest should yield abjectly to the public interest. The Village could undoubtedly pass a by‑law such as No. 7 if it is in the public interest but, prior to deciding in favour of the public interest, the Council should hear the landowner’s submissions. One cannot label an act “legislative” for the purpose of dispensing with fairness. A by-law may, in the public interest, operate to the detriment of particular individuals but not without giving those individuals a right of hearing.

It was contended that if prior notice is required a sophisticated owner receiving such notice would immediately “checkerboard” and thereby defeat the intent of the section. That may be true but, if so, it is an argument which should be addressed to the legislature accompanied by a request for an amendment which would specifically state that prior notice is not necessary.

Finally on this point, a requirement of both prior notice and subsequent notice does not introduce an element of redundancy. The earlier notice would permit representations by those affected and wishing to protest; the later notice would acquaint those who did not make represen-

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tations, as well as those who did, with the fact that action had been taken affecting their lands.

Third, the question of the proper classification of a statutory power was, for a time, believed to be crucial in the determination of whether a right to a hearing could be implied. It was suggested that a right to a hearing only existed in circumstances where the process was judicial or quasi-judicial in nature: Nakkuda Ali v. Jayaratne[50]. But this line of authority was rejected in England in Ridge v. Baldwin, supra, and, more recently, by this Court in Nicholson v. Haldimand-Norfolk Regional Board of Commissioners of Police et al., supra, and in Martineau v. Matsqui Institution Disciplinary Board[51]. The latter two cases clearly establish that a right to procedural ‘fairness’ no longer demands an a priori classification of a process as judicial or quasi-judicial. As the Chief Justice stated in Nicholson:

What rightly lies behind this emergence is the realization that the classification of statutory functions as judicial, quasi-judicial or administrative is often very difficult, to say the least; and to endow some with procedural protection while denying others any at all would work injustice when the results of statutory decisions raise the same serious consequences for those adversely affected, regardless of the classification of the function in question: see, generally, Mullan, Fairness: The New Natural Justice (1975), 25 Univ. of Tor. L.J. 281. (at p. 325).

In Martineau, it was said that review by certiorari was available whenever a public body has power to decide “any matter affecting the rights, interests, property, privileges, or liberties of any person” (at p. 628). Once it is clear that rights are being affected, it is necessary to determine the appropriate procedural standard that must be met by the statutory body. Above all, flexibility is required in this analysis. There is, as it were, a spectrum. A purely ministerial decision, on broad grounds of public policy, will typically afford the individual little or no procedural protection. See Re Braeside Farms Ltd. et al. and Treasurer of

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Ontario et al.[52] On the other hand, a function that approaches the judicial end of the spectrum will entail substantial procedural safeguards, particularly when personal or property rights are targetted, directly, adversely and specifically.

It seems to me that a similar analysis should be employed in the present case. That is, it is not particularly important whether the function of the municipality be classified as “legislative” or as “quasi-judicial”. Such an approach would only return us to the conundrums of an earlier era. One must look to the nature of the function and to the facts of each case. I would adopt what was said by Judson J. in the Wiswell case. Although Judson J. dissented in Wiswell, being of opinion that adequate notice had been given, he did say:

I do not think that it helps one towards a solution of this case to put a label on the form of activity in which the Metropolitan Council was engaged when it passed this amending by-law. Counsel for the municipality wants to call it legislative and from that he argues that they could act without notice. The majority of the judges prefer the term quasi‑judicial. However one may characterize the function, it was one which involved private rights in addition to those of the applicant and I prefer to say that the municipality could not act without notice to those affected. (My emphasis.) (at p. 526)

The Court of Appeal noted that the municipality was acting out of what it conceived to be the public interest. I have no doubt this is true. Council was seeking to protect members of the public from potential injury in the purchase of unserviced land and to protect its ratepayers from paying the costs of servicing. But that is no answer to the case made by the appellant. What we have here is not a by-law of wide and general application which was to apply to all citizens of the municipality equally. Rather, it was a by-law aimed deliberately at limiting the rights of one individual, the appellant Homex. In these circumstances, I would hold that Homex was entitled to some procedural safeguards. This does not mean that the municipality

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was under a duty to observe the procedures appropriate to a court of law. But, at a minimum, it was under a duty to give Homex notice of the proposed by-law and the opportunity to be heard. The ‘fundamental rule’, formulated by Lord Denning in Selvarajan v. Race Relations Board[53], and quoted by the Chief Justice in Nicholson, supra, applies.

… that, if a person may be subjected to pains or penalties, or be exposed to prosecution or proceedings, or deprived of remedies or redress, or in some way adversely affected by the investigation and report, then he should be told the case made against him and be afforded a fair opportunity of answering it. (at p. 19).

Has the Onus Been Satisfied?

Counsel for the Village argued that, even assuming Homex to be entitled to some procedural safeguards, the Village had not violated these safeguards. It is contended that the two parties had conducted extensive negotiations on the issue over a period of years; that the Village was well aware of the position of Homex and there was no suggestion that Homex would have any further representations to make had it received notice. The key passage in the judgment of the Court of Appeal reads:

But even though By-Law No. 7 operated to the special detriment of Homex, it was not unfair of the council to enact it without first giving notice and hearing what Homex had to say. From the negotiations which had taken place, the council already knew of the position being taken by Homex, and Homex knew of the attitude of the council. The intervention of the Court ought not to be called on to quash the by-law on this ground. The public interest, on the facts of this case, very obviously called for its enactment.

With all respect, I disagree.

There were indeed prolonged negotiations but at no time during the course of these negotiations did the Village ever indicate to Homex its intention to enact the impugned by‑laws. Homex had no notice whatever of the by-laws. I fail to see how the negotiations can be said to have satisfied the onus placed on the Village. The prior negotiations did not result in waiver of notice.

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Moreover, the argument that Homex would have had no further representations to make is pure speculation. The Court should not be put in the position of having to speculate as to the possible success a person might have enjoyed had he or she, in fact, received notice.

In my view, in fine, the Village was under a common law duty to give notice to Homex before passing by-laws aimed directly at the land of Homex. The common law duty has not been explicitly excluded by The Planning Act and I would hold that the respondent has not satisfied the notice requirement through prior negotiations. Accordingly, I would hold that the by-laws are void.

In light of the foregoing, it is not necessary to pronounce on the other grounds of appeal raised by Homex. In particular, it is not necessary to decide whether by-law No. 7 was invalid as having been passed for an indirect or improper purpose, as the Divisional Court held, or to decide whether by-law No. 6 was invalid due to an alleged lack of enacting language.

Two points in closing. First, the question of whether Mr. Redick knew of the terms of the Atkinson agreement at the time of purchase was not the subject of argument in this Court. Neither factum saw this question as being relevant to the issues at bar. In the Divisional Court only passing reference was made to the agreement. Anderson J., for the Court, said:

There appears to be some dispute as to whether the applicant did or did not have notice of the existence and terms of the subdivision agreement at the time it purchased. There is reference to it in the offer to purchase. In my view nothing turns on this in any event.

Second, the respondent did not in this Court, nor, apparently, in the Court of Appeal, take the technical point that the conduct of the appellant was such as to disentitle the appellant to relief by way of certiorari. The appellant was not called upon to face this issue in either Court. I would not deny relief on a ground not raised nor argued.

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I would allow the appeal, set aside the judgment of the Court of Appeal of Ontario and restore the judgment of the Divisional Court with costs to the appellant in all courts.

Appeal dismissed with costs, RITCHIE and DICKSON JJ. dissenting.

Solicitors for the respondent, appellant: Osler, Hoskin & Harcourt, Toronto.

Solicitor for the appellant, respondent: Lyle F. Curran, Sarnia.