ISSUE DATE:

December 09, 2013

PL130487

Ontario Ontario Municipal Board Commission des affaires municipales de ('Ontario IN THE MATTER OF subsection 45(12) of the Planning Act, R.S.O. 1990, c. P.13, as amended Appellant: Applicant: Subject: Variance from By-law No.: Property Address/Description: Municipality: Municipal File No.: OMB Case No.: OMB File No.: Wolf Lebovic, Lebovic Enterprises Limited FCHT Holdings (Ontario) Corporation Minor Variance 438-86 & 48-74 55, 77 & 87 Avenue Road City of Toronto A0145/13TEY PL130487 PL130487

IN THE MATTER OF subsection 97(1) of the Ontario Municipal Board Act, R.S.O. 1990, c. 0.28, as amended Request by: Request for: Costs sought against:
APPEARANCES:

FCHT Holdings (Ontario) Corporation Request for an Order Awarding Costs Wolf Lebovic, Lebovic Enterprises Limited

Parties

Counsel

Wolf Lebovic, Lebovic Enterprises Limited First Capital Holdings (Ontario) Corporation

Michael McQuaid

Eileen Costello and articling student Graham Topa

DECISION DELIVERED BY R. ROSSI ON A MOTION FOR COSTS AND ORDER OF THE BOARD

First Capital Holdings (Ontario) Corporation ("Moving Party") is seeking an Order for Costs from the Board against Wolf Lebovic, Lebovic Enterprises Limited (collectively, "Lebovic") ("Respondent") for his unsuccessful appeal to the Board in August 2013 against the Moving Party's requested variances to make functional and aesthetic improvements to the mixed use buildings at 55 and 77-87 Avenue Road, known as

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Hazelton Lanes ("subject property") in the Bloor-Yorkville area of the City of Toronto ("City"). The Respondent lives in a condominium residence above the Moving Party's commercial property. [2] FCHT now seeks a cost award from the Board against the Respondent on either

a substantial indemnity basis or a partial indemnity basis as a result of the hearing held on the appeal filed with the Board by the Responding Party from a decision of the Committee of Adjustment. Costs were incurred directly for the preparation of these motion materials as well as for the preparation for an attendance at this motion hearing. [3] The Moving Party makes the following assertions in pursuing its award of costs: 1. The Respondent failed to disclose any land use planning grounds for his appeal of the Committee of Adjustment decision. 2. The Respondent pursued the appeal in a manner that demonstrated a lack of

bona fides and he conducted himself throughout the proceeding in an

unreasonable, frivolous and vexatious manner and without regard for the costs such conduct caused the Moving Party and the Board. 3. The Respondent ignored clear direction from the Board during the proceedings, thereby lengthening the proceedings and requiring the Board to hear evidence and submissions on matters extraneous to the Board's jurisdiction. 4. The Respondent brought a motion for adjournment without notice or materials during the hearing, only to later abandon the motion. 5. In totality, the Respondent acted in a manner wholly without regard for the Board's process such that the Respondent's actions can be considered scandalous. [4] The Board had regard to the Moving Party's concerns and considered them in

the context of Rule 103 of the Board's Rules of Practice and Procedure, which provides the test to be met: The Board may only order costs against a party if the conduct or course of conduct of a party has been unreasonable, frivolous or vexatious or if the party as acted in bad faith. In reviewing the elements of this rule that define such

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conduct, the Board considered and made findings on the conduct of the Respondent and finds specific actions on the part of the Respondent to fall within four components of, this rule. Specifically: 1. A course of conduct necessitating unnecessary adjournments or delays or failing to prepare adequately for hearing events. 2. Failing to present evidence, continuing to deal with issues, asking questions or taking steps that the Board has determined to be improper. 3. Acting disrespectfully of the Board and the Moving Party. 4. Knowingly presenting false or misleading evidence. [5] As to the first point, following a course of conduct necessitating unnecessary

adjournments or delays or failing to prepare adequately for hearing events, it is the latter part of this statement that the Respondent's actions offend. [6] The Respondent advised the Board that a week-long (five-day) hearing would be

required as he intended to call professional witnesses in support of his appeal. In this regard, the Moving Party prepared for a hearing of that length, anticipating appearances of opposing professional and lay witnesses and thus prepared comprehensive land use planning and urban design evidence and visual exhibits. The hearing was eventually reduced to a two-day process but concluded in a single day. When the hearing commenced on August 22, 2013, the Board and the Moving Party learned that the Respondent had no expert witnesses to support his appeal to the Board. Other than the appearance of several residents who shared lay opinions, the only witness for the Respondent was the Respondent, called by his lead counsel to give non-expert testimony that raised no authentic land use planning issues as the Board subsequently determined. [7] As to the second point, failing to present evidence, continuing to deal with issues,

asking questions or taking steps that the Board has determined to be improper, the Respondent's actions fall within this behavior. The Respondent demonstrated these types of behaviors and actions that warrant the Board's consideration of the costs

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motion. It is important to note that the Board is also not bound to order costs when any of these examples occur. [8] The central element of the Respondent's case was the issue of private litigation

that was occurring separate from these proceedings. His documentary materials relied heavily on evidence related to the litigation and on extraneous matters. The Board repeatedly provided clear direction to the Respondent, both directly and through his counsel, to refrain from presenting matters of a separate legal process and instead to present any information and planning evidence that might inform the Board of the Respondent Party's position vis -a -vis the proposed variances. The Board also explained that the Board's jurisdiction to consider the Respondent's appeal was found in the Planning Act ("Act"). The matter of private litigation had no bearing on the issue of whether the variances sought meet the tests of a minor variance as set out in s. 45(1) of the Act. [9] As stated, the Respondent failed to present any planning evidence to the Board,

either in writing or through oral evidence. The closest the Respondent came to single planning-related issue was his concern that his terrace views downward would be impacted by the proposed development (he would not be able to look down eight storeys to the sidewalk). This assertion was ultimately determined by the Board not to be credible, however, given that the sole and uncontradicted planning evidence presented at this hearing came from the proponent's planner, who demonstrated persuasively that the Respondent's existing views from his interior space would remain unaltered and unaffected by the proposed redevelopment of the Moving Party's space, which will be confined to the first two floors of the building (the Respondent lives on the eighth floor). [10] The four tests of the Act as referenced above are necessary elements of

consideration for evaluating whether variances are minor in all minor variance applications yet these were never considered let alone referenced. [11] Counsel for the Respondent, Mr. McQuaid, did his best to support his client at

this costs motion hearing but the reality of the Respondent's actions and behavior before and during the hearing could not be explained away and certainly not to the satisfaction of the Board such that an award of costs could not be considered. It is clear

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to the Board that the Respondent's intention in filing this appeal with the Board was to litigate non-land use planning matters through the Board's appeal process under s. 45(12) of the Act. This was not done out of ignorance of the Board's processes either; the Respondent provided oral evidence at the hearing that he is an experienced developer and familiar with the Board and its processes. Indeed, the Respondent raised various land use planning arguments in his appeal but he neither referenced nor substantiated any of those arguments and he failed to provide any planning evidence at the hearing. Moreover, the Respondent attended this hearing with an experienced counsel who assisted the Respondent in the presentation of his case at these proceedings albeit bereft of planning considerations or evidence. Further, the Respondent not only wilfully disregarded the Board's clear and repeated directions throughout the hearing so as to lengthen the proceedings and to cause the Moving Party to respond to what amounted to a moving target in respect of what the Respondent's non-planning evidence might be and where next the Respondent's evidence would take the Moving Party and the Board in the course of the hearing. [12] The Board places no persuasive weight on the Respondent's affidavit or

counsel's submission that matters related to the private dispute raised at the hearing were what he thought to be "major" matters that might be of assistance and relevance to the Board. These had no bearing on the tests for a minor variance as set out in the Act and as the Board repeatedly cautioned at the hearing. Of particular relevance is the submission of the Moving Party's counsel related to how pertinent the private litigation matters were to this appeal. As she stated, if the Respondent genuinely believed that such matters were pertinent to the appeal, then these matters should have been either raised or referenced in the actual appeal from the Committee decision. They were not and it was only at the hearing that the Respondent's case rested on these matters. [13] The Board was informed of the Respondent's actions prior to the hearing and

noted his references to seeking an adjournment of the August proceedings. The Board specifically cites his action an ad hoc request for an adjournment in the middle of the hearing process and subsequently withdrawn to be an example of improper behavior that constitutes unreasonable behavior on his part. This is particularly relevant given that the Board had already read the advance correspondence from the Respondent and the Board specifically commenced its August 2013 hearing proceedings by first asking the Respondent through his counsel whether he was seeking an adjournment. The

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counsel responded that he was not. As early as June 2013, the Respondent filed a Notice of Application under the Condominium Act, 9998 S.O. 1998, c. 19 for a compliance order and injunctive relief and named the Moving Party as a respondent. The Moving Party would not consent to the adjournment of the scheduled hearing before the Board. The Respondent wrote. on June 21, 2013 that if consent to the adjournment request was not obtained by June 26, 2013, the Respondent would arrange for an attendance in court on an urgent basis to seek injunctive relief. The adjournment was not agreed to and the Respondent did not seek injunctive relief. Yet, one hour into the presentation of evidence during the full hearing process, during the August 22, 2013 Board hearing, the Respondent requested (through his counsel) an adjournment of the proceedings without notice or materials yet this motion was subsequently withdrawn. The Board reiterates that it began its proceedings by asking whether an adjournment would be sought. The Respondent's counsel responded that it would not. This behavior is unreasonable and improper in the Board's view. [14] As to the third point, acting disrespectfully of the Board and the Moving Party, the

Respondent's actions fall within this behavior. As noted above, the Respondent continued to pursue factors related to the private litigation matter. Despite the Board's direction, not only did the Respondent ignore these directions but his lead counsel also disregarded the Board's repeated direction: the Respondent continued to provide irrelevant testimony and his lead counsel pursued questions and documentary materials of private litigation with the Respondent and he made submissions on extraneous matters. The Respondent's disrespect for the Board's process and in particular for the direction of the Board Member as described in these reasons constitutes unreasonable and disrespectful behavior. [15] As to the fourth point, knowingly presenting false or misleading evidence, the

Board finds there is persuasive evidence that the Respondent's actions surrounding his prior knowledge of an agreement as to the private litigation yet proceeding with his case on the basis of ongoing litigation constitutes such behavior. The Moving Party's counsel, Ms. Costello, submitted that the Respondent was attempting to use the minor variance hearing as "leverage" in the private dispute in order to obtain findings in the Board hearing that might assist in a determination of the separate court litigation. The Board made findings in its decision on the relevance of the private litigation evidence. It is in the Respondent's motion materials that the Board learned that the private dispute,

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which occupied the vast majority of the Respondent's evidence and of his counsel's submissions at the hearing, was abandoned subsequent to the Board's hearing (Affidavit of Wolf Lebovic, sworn November 15, 2013 at paragraph 5, Lebovic Responding Motion Record, Tab 2, pages 6 and 7). Ms. Costello alerted the Board to the timing of the Respondent's abandonment of the private litigation. As she explained, however, the Respondent confirmed his receipt of the information upon which the abandonment was based as early as August 1, 2013, a full three weeks prior to the Board's hearing but it was not until five days after the Board hearing that the Respondent instructed his then-counsel Mr. Spears to deliver a Notice of Abandonment of the action brought by the Appellant (in that matter) (ibid., at paragraphs 7 and 8). [16] This raises in the Board's mind a valid concern with the Respondent's

presentation of evidence in a fashion that can be summarized as misleading. Specifically, while the Respondent now asserts in his responding materials that his concerns were addressed as of August 1, 2013, he relied almost exclusively on the reference to active private litigation more than three weeks later at the Board hearing despite knowing that his concerns were being addressed. In the Board's view, there are reasonable doubts generated by the Respondent's actions.in this regard which was to use the Board's processes to assist in a separate legal process as detailed and as abandoned subsequent to the Board's proceedings. Yet, the Respondent chose to pursue these matters as the basis for his appeal of the minor variance application while failing to respect the repeated direction of the Board that he focus on planning matters. The impact of the Respondent's lack of respect of the Board and its proceedings further caused unnecessary and extraneous information to be presented in a manner that only served to lengthen and delay the efficient processing of this appeal as well as to ignore the planning regime to which the Moving Party had confined its evidence and remarks. [17] The Board considered the submissions of the Respondent's counsel, Mr.

McQuaid, whose representation of the Respondent at this motion was professional and exemplary despite the nature of his client's participation at the August hearing. In this regard, Mr. McQuaid made several persuasive submissions to the Board. First, the Board is persuaded that the behavior of the Respondent cannot be considered to be scandalous. Nevertheless, for the reasons provided herein, the Respondent's behavior is determined by the Board to be unreasonable, frivolous and vexatious. Second, the Board finds persuasive Mr. McQuaid's submission that parties often anticipate and plan

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for longer hearings yet matters can be scoped or set aside and the resulting process can often be much shorter than originally scheduled. In this context, the estimated hearing length should not be held against the Respondent. However, the Respondent furnished no details to the Moving Party of the five witnesses he intended to call. With the planning issues stated in the Respondent's appeal as the basis for their preparatory work, the Moving Party and its counsel and expert witness reasonably and appropriately prepared for a lengthy hearing (and at significant cost to the Moving Party) that might include up to five expert witnesses. Active adjudication in advance can often reduce the time allotted to hearings; active communication between the parties can achieve a similar result. None of this was possible prior to the hearing, however, and the Moving Party had to rely on the Respondent's information. The result was the Respondent arriving with counsel at the hearing without expert witnesses and to instead present information of private litigation matters that had nothing to do with the evidentiary requirements of a minor variance appeal. [18] Ms. Costello explained that her client did not doubt that the Respondent

"genuinely believed" that the issues he had raised and the evidence he chose to present at the hearing were somehow relevant to the Board's consideration of the appeal. References to Board jurisprudence on this point were provided by Ms. Costello. Indeed, the Board held in its decision of September 4, 2001 (and issued September 24, 2001) (Order No. 1539, Niagara Falls decision) that there is no need to show one's intent to make a finding of unreasonable behavior. It is the actions of the Respondent in this case and their impact on the Moving Party and the Board that the Board assessed; not his intent. Thus, the Board heard that, while the Moving Party accepted that the Respondent genuinely believed the importance of his appeal and that the referenced private litigation would be of interest to the Board in its deliberations, that is not the test. Instead, it is one of whether the actions or conduct of the Respondent throughout the proceedings were unreasonable. [19] Mr. McQuaid's submission that sometimes the legal foundation of an application

can be relevant to the Board but specific examples were not cited other than references to matters of ownership, status and legality that might under lie a planning consideration. In the case at hand, however the Respondent's pursuit of private litigation and the reliance on those matters instead of on planning evidence not only did not help the proceedings; it hindered them.

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[20] The Board has the jurisdiction and discretionary authority to award costs in its proceedings. While cost awards are rare, their purpose is to censure behavior that the Board believes is clearly unreasonable, frivolous, vexatious or made in bad faith. The test for clearly unreasonable conduct that is most often cited in Board decisions is: would a reasonable person, having looked at all of the circumstances of the case, conclude the conduct was not right; the conduct was not fair and that person ought to be obligated to another in some way for that kind of conduct. [21] While the Board does not award costs lightly and not automatically, the Board has repeatedly expressed its sensitivity to the right of appellants to bring matters before the Board. The Board also strives to ensure that cost awards not be used punitively to deter public participation in the Board's processes; such awards are only made where the conduct complained of is so improper that the Board cannot ignore it. [22] Considering the aforementioned four elements of the Board's Rule 103, the Board finds that an award of costs is appropriate in this case. The Board finds that the Respondent's actions do not reflect the actions expected of genuine parties to a hearing. Based on the evidence as provided, the Board finds that the Respondent's failure to prepare himself for these proceedings; to present material unrelated to the planning issues of the case; to disregard the Board's direction; and to focus on extrajurisdictional matters to warrant an award of costs. The Board also finds that the Respondent has abused the Board's processes in the ways described in these reasons. The Board also finds the Respondent's introduction of an adjournment motion an hour into the proceedings and then to withdraw it later on constitutes a frivolous approach to the serious nature of these proceedings, particular where the reasons for doing so related to the private litigation and not for any planning or process-related matter. [23] The Board has carefully considered the submissions of counsels and makes the following other determinations: a) The Respondent has failed to meet the onus on him to prepare adequately for the Board's hearing and to bring sufficient planning evidence to support his appeal; b) The Respondent has acted unreasonably, frivolously and vexatiously in the following ways:

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by attempting to litigate non-land use planning matters that were of no relevance to his s. 45(12) appeal under the Act; by ignoring the repeated direction of the Board during the hearing to confine his evidence to planning matters and to avoid separate private litigation evidence that the Board had ruled had not place in the planning appeal; and by failing to cooperate with the Moving Party in preparation for the hearing and by failing to coordinate witnesses and the exchange of documentary materials to assist the Moving Party. in preparing for any salient planning matters to be adjudicated by the Board. [24] These actions are of significant weight and importance such that the time, effort

and expenditure of substantial financial resources on the part of the Moving Party and its counsels in bringing this motion for costs are worthy of compensation. In this regard, the Board finds that it is proper and entirely consistent with the Board's Rules of Practice and Procedure to order an award of costs against the Respondent to the Moving Party for the preparation of motion materials and attendance at this costs motion hearing on a partial indemnity basis. ORDER [25] The motion is allowed. The Board orders the Respondent to pay to the Moving

Party the amount of $11,085.24 as sought on a partial indemnity scale.

"R. Rossi"

U U1