) ) CONSERVE OUR RURAL ENVIRONMENT (CORE) INC. Appellant – v. –, 2013 ONSC 7307

CITATION : Conserve Our Rural Environment v. Dufferin Wind Power Inc., 2013 ONSC 7307 DIVISIONAL COURT FILE NO.: 356/13 DATE: 20131125 ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT A.C.J.S.C. MARROCCO, THEN R.S.J. AND GORDON J. BETWEEN: ) ) CONSERVE OUR RURAL ENVIRONMENT (CORE) INC. Appellant – and – DUFFERIN WIND POWER INC. -and – ONTARIO ENERGY BOARD Respondents )) )) )) )) )))))) David Crocker , for the Appellant Crawford Smith and Andrew Finkelstein , for the Respondent, Dufferin Wind Power Inc. Michael S.

Millar, for the Respondent, Ontario Energy Board ) ) ) HEARD at Toronto: November 25, 2013 GORDON J. Overview [ 1 ] Conserve Our Rural Environment (CORE) Inc. (“CORE”) appeals a decision of the Ontario Energy Board (the “Board”), dated July 5, 2013. In that decision, the Board approved Dufferin Wind Power Inc.’s (“Dufferin”) application to construct electricity transmission lines and associated facilities for the purposes of connecting its wind energy project to Ontario’s electricity grid.

As part of the Board’s decision, it approved the forms of agreement offered to each landowner affected by the approval. [ 2 ] CORE argued before the Board that the independent legal advice (“ILA”) clauses in the agreements were confusing, misleading and unfair. It argues the Board’s subsequent approval of the forms of the agreement constitutes an error of law. CORE also submits that the Board failed to provide adequate reasons for its decision to approve the agreements.

Background Facts [ 3 ] CORE is a not-for-profit corporation established to oppose proposed developments that might adversely impact the rural environment in or about Mulmer Township. It applied for and received intervenor status at the hearing before the Board. [ 4 ] The Dufferin Wind Power Project (the “Project”) is a planned wind energy farm. Dufferin applied to the Board pursuant to

section 92 of the Ontario Energy Board Act , 1998 (the “Act”) for an order granting it leave to construct approximately 47 kilometres of power lines and associated facilities for the purposes of the Project.

[ 5 ] Sections 92 and 96 of the Act require the Board to consider whether the construction of transmissions lines is in the public interest. Section 96(2) provides that in determining the public interest, the Board shall only consider the following: 1. The interests of consumers with respect to prices and the reliability and quality of electricity service; and 2. Where applicable, the promotion of the use of renewable energy sources in Ontario. [ 6 ]

Section 97 provides that the Board shall only grant an application under

section 92 if the applicant satisfies the Board that it has offered or will offer to each landowner affected by the approved route, an agreement in a form approved by the Board. [ 7 ] Dufferin applied to the Board under

Section 92 for approval of its plans to construct the power lines and associated facilities. It also sought an order approving the forms of land agreements offered to owners of the land affected by the proposed route. To this end, Dufferin sought approval for six forms of land agreements under

section 97. Four of the forms contain ILA provisions. Two do not. The Project Substation Lease and Transmission Lease contain the following ILA clause: With respect to this lease and all matters related thereto, the parties acknowledge that Shibley Righton LLP has acted as lawyers for the Landlord and Torys LLP has acted as lawyers for the Tenant. The Landlord confirms to the Tenant that the Landlord has reviewed this Lease with the Landlord’s independent legal counsel and fully understands the Landlord’s rights and obligations under this Lease.

The Tenant confirms to the Landlord that the Tenant has reviewed this Lease with the Tenant’s independent legal counsel and fully understands the Tenant’s rights and obligations under this Lease. The Turbine and Transmission Lease contains the following ILA clause: Each party acknowledges that this Lease has been prepared by the Landlord’s lawyers [redacted]. With respect to this Lease and all matters related thereto,[redacted] has acted for the Landlord and is not acting as lawyers for the Tenant.

The Tenant hereby acknowledges that the Tenant has had the opportunity and has been advised by the Landlord and its lawyers to review this Lease and all matters related thereto with independent legal counsel of the Tenant’s own choice prior to the Tenant’s execution of this Lease. The Tenant confirms to the Landlord that the Tenant has reviewed this Lease with the Tenant’s independent legal counsel and fully understands the Tenant’s rights and obligations under this Lease. [ 8 ] CORE argues that the ILA provisions are false and misleading because: (

a) Shibley Righton LLP acts as counsel for a minority shareholder of Dufferin, who is the tenant; (

b) As it is the Landlord’s property that is proposed to be encumbered, the Landlord is the party requiring independent legal advice; (

c) ILA is stated to be for Dufferin, the Tenant, when the agreements were prepared by it. In addition, CORE submits that because the agreements contain misleading language and permit the distortion of the balance of power between the parties, their approval is not in the public interest. [ 9 ] The Board granted leave to Dufferin to construct the transmission lines. It acknowledged CORE’s argument that the ILA clauses contained inaccuracies in form and content.

Nonetheless, it felt that the proposed land agreements were acceptable and held that to the extent the ILA clauses raised questions involving professional ethics, they are best left to the Law Society of Upper Canada, the licensing body governing the legal profession in Ontario. Jurisdiction of this Court [ 10 ]

Section 33 of the Act provides as follows: 33.

(1) An appeal lies to the Divisional Court from: (

a) an order of the Board;

(2) An appeal may be made only upon a question of law or jurisdiction and must be commenced not later than 30 days after the making of the order or rule or the issuance of the code. [ 11 ] The initial question, then, is whether CORE has raised an issue of law or jurisdiction. In our view, it has not. [ 12 ] When considering agreements to be offered to affected landowners, the Board approves a standard form of agreement in the context of the application in which it has been filed. Once approved, the parties are free to negotiate whatever terms they believe to be necessary to protect their specific interests.

The Board does not become involved in the detailed negotiations between one landowner and the Applicant. [See EB-2006-0305 , Decision and Order dated June 1, 2007]. [ 13 ] The authority of the Board to approve the form of a contract is discretionary. As this court has held in Natural Resources Gas Limited v. Ontario Energy Board, 2012 ONSC 3520 (quoting the Alberta Court of Appeal in Wood Buffalo (Regional Municipality) v.

Alberta (Energy and Utilities Board), 2007 ABCA 192 ) an arguably unreasonable exercise of a discretion is not an error of law or jurisdiction. [ 14 ] In the event we are mistaken in that regard, we make the following additional findings with respect to the issues raised in this appeal.

Standard of Review [15] In the event CORE has indeed raised an issue of law or jurisdiction, it is necessary to consider the applicable standard ofreview. We are of the view that the appropriate standard is reasonableness. The Board was interpreting its home statute and the issuesraised in this appeal are not of central importance to the legal system. Our decision reflects the principles set out in Alberta (Information& Privacy Commissioner) v. Alberta Teachers’ Association, 2011 SCC 61, and reflects similar findings by this court in GoldcorpCanada Ltd. v.

Ontario Energy Board, 2012 ONSC 3097. [16] Reasonableness is concerned mostly with the existence of justification, transparency and intelligibility within thedecision-making process. It is also concerned with whether the decision falls within a range of possible, acceptable outcomes which aredefensible in respect of the facts and law [see Dunsmuir v. New Brunswick, 2008 SCC 9 , [2008] 1 S.C.R. 190 (SCC)]. Was the Decision of the Board Reasonable? [17] We find that the decision of the Board was reasonable.

It is important to understand that what the Board approved wasa form of agreement which is the subject of subsequent negotiation between the parties. It represents terms from which the partypropounding the project may not unilaterally resile. [18] Although it may have been more appropriate to leave blank spaces for the names of legal counsel offering ILA to thelandowners, the inclusion of the name of a particular firm cannot bind that firm to act, nor can it excuse that firm from its professionaland ethical obligations to act without conflict.

The Board, alive to the conflict issue raised by CORE, appropriately determined thatthose professional and ethical obligations are best addressed in the context of the regulation of the legal profession. [19] Although counsel for CORE urged us to find the form of the agreements to be unconscionable we are not persuadedthis is so. Indeed, there is a complete lack of evidence in this regard.

There is no evidence that any landowner was confused by thewording of the ILA provisions, or that any of them perceived an inequality of bargaining power, or that any of the terms of theagreements would have unconscionable consequences. We find it telling that none of the landowners have taken issue with the forms ofagreement approved by the Board. Adequacy of Reasons [20] CORE argued that the Board erred by failing to provide adequate reasons. It submits that the path taken by the Boardto reach its decision is unclear or non-existent. We do not agree.

The required standard is set out in Newfoundland & Labrador Nurses’Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62, as follows: Reasons may not include all the arguments, statutory provisions, jurisprudence or other details the reviewing judge would havepreferred, but that does not impugn the validity of either the reasons or the result under a reasonableness analysis. A decision-maker isnot required to make an explicit finding on each constituent element, however subordinate, leading to its final conclusion (ServiceEmployees’ International Union, Local No. 333 v.

Nipawin District Staff Nurses’ Assn., (SCC), [1975] 1 S.C.R. 382, atp. 391). In other words, if the reasons allow the reviewing court to understand why the tribunal made its decision and permit it todetermine whether the conclusion is in the range of acceptable outcomes, the Dunsmuir criteria are met. [21] On review of the written closing submissions made to the Board by CORE and the reply by Dufferin, we are satisfied that theBoard was alive to the issues raised by CORE and dealt with each issue in its reasons.

We have no difficulty understanding why it madeits decision and are content that the conclusion is within the range of acceptable outcomes. Conclusion [22] In conclusion, the appeal by CORE is dismissed. In the event the parties are unable to agree on costs, they may make written submissions to us within 15 days. Each party’s submissions shall be limited to three pagesexclusive of attachments. A.C.J.S.C. MARROCCO THEN R.S.J.

GORDON J. Date of Reasons for Judgment: November 26, 2013 Date of Release: CITATION : Conserve Our Rural Environment v. Dufferin Wind Power Inc., 2013 ONSC 7307 DIVISIONAL COURT FILE NO.: 356/13 DATE: 20131126 ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT A.C.J.S.C. MARROCCO, THEN R.S.J. AND GORDON J. BETWEEN: CONSERVE OUR RURAL ENVIRONMENT (CORE) INC. Appellant – and – DUFFERIN WIND POWER INC. -and – ONTARIO ENERGY BOARD Respondents REASONS FOR JUDGMENT GORDON J. Date of Reasons for Judgment: November 26, 2013 Date of Release: