Springfield Taxpayers Rights Corp v Rural Municipality of Springfield and Berger Peat Moss Ltd, 2023 MBCA 57

Citation: Springfield Taxpayers Rights Corp v Rural Municipality of Springfield and Berger Peat Moss Ltd, 2023 MBCA 57 Date: 20230613 Docket: AI22-30-09851 IN THE COURT OF APPEAL OF MANITOBA Coram: Madam Justice Freda M. Steel Madam Justice Diana M. Cameron Mr. Justice Christopher J. Mainella BETWEEN : ) K. A. McCandless and SPRINGFIELD TAXPAYERS RIGHTS CORP. ) T. Yakimchuk ) for the Appellant ) (Applicant) Appellant ) F. J. Trippier and ) V. Luong ) for the Respondent - and - ) Rural Municipality of ) Springfield ) Rural municipality of springfield ) T. J.

Fry and Berger Peat moss LTD. ) for the Respondent ) Berger Peat Moss Ltd. ) (Respondents) Respondents ) Appeal heard and ) Decision pronounced: ) June 13, 2023 On appeal from 2022 MBKB 180 Cameron JA ( for the Court): Introduction and Background [ 1 ] This is an appeal by the applicant of an order of the motion judge striking its application for abuse of process and, in the alternative, dismissing it for delay pursuant to r 38.12 of the MB, Court of King’s Bench Rules , MR 553/88 . It is also an appeal of the motion judge’s order dismissing its motion to amend its notice of application.

At the conclusion of the oral submissions, we dismissed the appeal and indicated that reasons would follow. These are those reasons. [ 2 ] The applicant is a non-profit corporation consisting of residents of the respondent Rural Municipality of Springfield in Manitoba (the RM). It filed an application on June 29, 2021, requesting that development permits that the RM had issued to the respondent Berger Peat Moss Ltd. (Berger) for the construction of a peat moss processing plant (the plant) be declared invalid and an order of certiorari quashing them.

In the alternative, it requested various orders of mandamus . [ 3 ] The RM and Berger filed motions to strike out the application on the basis that, among other things, it constituted an abuse of process. They also each filed separate motions arguing that the application should be dismissed for delay pursuant to r 38.12. [ 4 ] The applicant subsequently filed a motion to amend the notice of application to add Margaret Marion-Akins (Ms Akins) as an applicant, to request an injunction and to seek a determination of rights. [ 5 ] The motion judge dismissed the motion to amend.

He granted the motion to strike the application without leave to amend on the basis that it constituted an abuse of process. Alternatively, he dismissed the application pursuant to r 38.12(1) and ordered

that the dismissal shall act as a defence to subsequent applications pursuant to r 38.12(3). [ 6 ] As earlier indicated, it is the above order that is appealed. Facts [ 7 ] The timeline of events is set out extensively in the reasons of the motion judge (see para 10). Thus, the facts will only be briefly reviewed in these reasons. In April 2019, Berger approached the RM about developing the plant in the RM. In February 2020, the RM issued a development permit for construction of the foundation of the plant and Berger commenced construction.

The construction, including obtaining all of the related permits, continued between February 2020 and July 2021.

The plant became operational in August 2021. [ 8 ] By early April 2020, Edward Akins and his wife, Ms Akins (the Akins) (two of the directors of the applicant and owners of property adjacent to the plant), were fully aware that a peat moss processing plant was under construction. [ 9 ] The motion judge found that, instead of taking legal action to stop the construction, the Akins communicated their opposition to the plant by way of emails or other communications to council members of the RM and the provincial Environmental Assessment and Licensing branch.

He stated that, as of July 2020, they had retained lawyers experienced in municipal and environmental matters and, later, a registered municipal planner to assist them. He noted that the Akins had made representations to the RM, but that it refused to revoke the development permits and refused the Akins’ requests for reconsideration of its decisions. [ 10 ] In December 2020, the applicant was incorporated. All the while, the plant was under construction. [ 11 ] In May 2021, the RM issued an interim occupancy permit for the plant and Berger was able to commence business operations.

It was not until June 29, 2021 that the applicant filed the notice of application that is the subject of these proceedings and in which Berger was not originally named as a respondent. Berger was not named as a respondent until November 2021, when the applicant eventually consented to Berger’s motion to be joined as a party to the litigation.

Analysis and Decision [ 12 ] At the outset, it is important to note that, while the parties argued about whether or not the applicant’s conduct amounted to an abuse of process in the common law, we need not decide whether the motion judge erred in his decision on the abuse of process motion. We neither endorse nor disagree with his decision in that regard. This is because we are of the view that he made no error in his alternative finding that the application should be dismissed pursuant to r 38.12(1).

In light of this finding, we need not consider the applicant’s appeal of the dismissal of its motion to amend the notice of application. [ 13 ] A decision made pursuant to r 38.12 is discretionary. It is to be reviewed on the deferential standard. The decision is not to be interfered with unless the motion judge misdirected himself or the decision is so clearly wrong as to amount to an injustice.

Errors in law are reviewed on the correctness standard and errors of fact and mixed fact and law are reviewed on the standard of palpable and overriding error (see The Workers Compensation Board v Ali , 2020 MBCA 122 at para 20 ; and Buhr v Buhr , 2021 MBCA 63 at para 29 ). [ 14 ] Contrary to the applicant’s position, we are not persuaded that the motion judge erred in failing to apply the considerations set out in r 38.12(2). [ 15 ] Rules 38.12(1)-38.12(3) provide: Motion 38.12(1) The court may on motion dismiss an application for delay.

Grounds 38.12(2) On hearing a motion under this rule, the court may consider, (

a) whether the applicant has unreasonably delayed in obtaining a date for a hearing of a contested application; (

b) whether there is a reasonable justification for any delay; (

c) any prejudice to the respondent; and (

d) any other relevant factor.

Dismissal not a defence to subsequent application 38.12(3) The dismissal of an application for delay is not a defence to a subsequent application unless the order dismissing the application provides otherwise. [ 16 ] Dismissal for delay in an application under r 38.12 involves the same considerations as those under the former r 24.01 (see the Court of Queen’s Bench Rules, amendment , Man Reg 130/2017).

Matters which should be taken into account on a motion for delay include: i. the subject matter of the litigation; ii. the complexity of the issues between the parties; iii. the length of the delay; iv. the explanation for the delay; and v. the prejudice to the other litigant. See Coombs v Magellan Aerospace Ltd , 2018 CarswellMan 802 at para 7 (QB) . [ 17 ] In his reasons regarding r 38.12, the motion judge stated that his decision with respect to abuse of process covered all of the considerations detailed in r 38.12 (see para 43).

While his reasons regarding the abuse motion do not follow the exact order of the matters that I have listed above, the motion judge did make the following findings: • That the delay was inexplicable and inordinate. This was based on his finding that the applicant did not seek injunctive relief when the Akins first learned of the construction of the plant in April 2020 and disregarded a September 8, 2021 deadline set by another judge of the Court of King’s Bench by which the applicant was to clearly state its position with respect to injunctive relief.

He found that no explanation was offered regarding the failure to respect the deadline or advise of its position at all (see para 24); • That the delay was unfair to Berger which was entitled to be named as a party and know the case against it (see para 27). [ 18 ] Regarding prejudice, the motion judge accepted Berger’s evidence that it had invested about $25 million in the development and construction of the plant and that to cease operations and relocate would cost at least $35 million.

He also found that it would also impact Berger’s ability to continue to operate under its current supply chain structure in Canada. He rejected the applicant’s position that Berger was taking a risk in constructing the plant when Berger obtained all of the necessary permits and authorizations. [ 19 ] In the end, the motion judge found significant prejudice. [ 20 ] In Ali , Burnett JA summarized the weighing of the factors to be considered under the former r 24.01.

He stated (at para 25): Under the former rule, factors such as the subject matter of the litigation, the complexity of the issues, the length of the delay and other relevant circumstances of the case were considered to determine whether the delay was undue, inordinate or unreasonable.

This Court emphasised that a motion judge had to address three interrelated issues when considering whether essential justice required the plaintiff’s action to proceed or be dismissed: the explanation for the delay; whether the delay was unreasonable; and the prejudice, both specific and inherent, to the defendant as a result of the delay. If undue and unexplained delay by the plaintiff was found, and it was determined that the defendant had suffered either from “specific” prejudice or significant “inherent” prejudice, then dismissal of the action for delay generally followed.

The issue of prejudice was the “often decisive” factor ( Mauer v McDougall , 2001 MBCA 2 at para 11 ). [emphasis added] [ 21 ] We note that the main issue in the litigation regarding whether the proper developmental permit was approved is hotly contested between the parties. The merits of that issue cannot be said to be a “slam dunk” for either the applicant or the respondents based on the evidence filed to date.

However, in the end, it is the delay and prejudice in this case that are determinative of the matter. [ 22 ] We are not convinced that the motion judge erred in law regarding his determination regarding r 38.12. Nor are we persuaded that the motion judge made a palpable and overriding error in the facts that he found and his application of the law to them. [ 23 ] While we have not found material error with the motion judge’s determination regarding r 38.12, we would make one final comment.

We are concerned that, in his reasons, the motion judge implied that the members of the applicant were “‘not-in-my- backyard’ activists” (at para 38) and stated that the applicant started the litigation “in order to deliberately inflict catastrophic financial pain on Berger and its employees” (at para 41). These comments are intemperate, unnecessary and unfounded on the facts. We do not endorse them.

[ 24 ] For the above reasons, the appeal was dismissed with costs. JA JA JA