Ontario Home Builders' Association et al. v. Board of Education of York Region et al., (1993) 62 O.A.C. 321 (DC)

• Judge: O'Driscoll, White and McKeown, JJ.
• Court: Ontario Court of Justice General Division (Canada)
• Case Date: May 20, 1993
• Jurisdiction: Ontario
• Citations: (1993), 62 O.A.C. 321 (DC)

Home Builders Assoc. v. York School Bd. (1993), 62 O.A.C. 321 (DC)

MLB headnote and full text

Ontario Home Builders' Association, Humber Green Estates Ltd. and Butternut Grove Homes Inc. (applicants) v. The York Region Board of Education, The York Region Roman Catholic Separate School Board and The Attorney General of Ontario (respondents)

(File No. 666/91)

Indexed As: Ontario Home Builders' Association et al. v. Board of Education of York Region et al.

Ontario Court of Justice

Divisional Court

O'Driscoll, White and McKeown, JJ.

May 20, 1993.

Summary:

The Development Charges Act (Ont.) provided for a new method of raising funds for capital expenditures for new schools. Part III of the Act gave school boards the authority to impose education development charges against land undergoing residential and commercial development where that development will give rise to the need for new schools directly attributable to it. Once the charge is approved by the Minister of Education, the charge is payable on a per unit basis when a building permit is issued. The York Region Board of Education and the York Region Roman Catholic Separate School Board passed bylaws imposing education development charges in the York Region. The Ontario Home Builders' Association and two developers applied for judicial review to quash the bylaws.

The Ontario Divisional Court, allowed the application and quashed the bylaws. The court, White, J., dissenting on this point, held that the education development charges constituted an indirect tax contrary to s. 92(2) of the Constitution Act, 1867.

Civil Rights - Topic 8302

Canadian Charter of Rights and Freedoms - Effect of - On rights in Constitution - Two school boards passed bylaws imposing education development charges on new homes under the Development Charges Act, Part III - Interested builders applied for judicial review, arguing that the charges were contrary to the Charter - White and O'Driscoll, JJ., of the Ontario Divisional Court, opined that this issue was settled by the Supreme Court of Canada in Reference Re Roman Catholic Separate High Schools Funding, 77 N.R. 241; 22 O.A.C. 321 - The opening words of s. 93 of the Constitution Act, 1867, granting legislative power to the Province to make laws in relation to education, immunize a Provincial statute, otherwise constitutionally valid, from attack on the basis of some alleged Charter infringement - See paragraphs 4, 11.

Constitutional Law - Topic 6822

Provincial jurisdiction (Constitution Act, 1867, s. 92(2)) - Direct taxation within the province - What constitutes a tax - Two school boards passed bylaws imposing education development charges on new homes pursuant to Part III of the Development Charges Act - The Ontario Home Builders' Association et al. applied for judicial review, arguing that the education development charges constituted indirect taxation contrary to s. 92(2) of the Constitution Act, 1867 - The Ontario Divisional Court, per O'Driscoll and McKeown, JJ., held that an education development charge was an indirect tax contrary to s. 92(2) - The court therefore quashed the school boards' bylaws - See paragraphs 2, 54 to 131.

Constitutional Law - Topic 6824

Provincial jurisdiction (Constitution Act, 1867, s. 92(2)) - Direct taxation within the province - What constitutes a direct tax - The Ontario Divisional Court reviewed the test for what constitutes a direct tax, as opposed to an indirect tax for purposes of s. 92(2) of the Constitution Act, 1867 - See paragraphs 107 to 127.

Constitutional Law - Topic 6824

Provincial jurisdiction (Constitution Act, 1867, s. 92(2)) - Direct taxation within the province - What constitutes a direct tax - [See Constitutional Law - Topic 6822 ].

Constitutional Law - Topic 9542

Separate or denominational schools - Extent of constitutional guarantees under s. 93, Constitution Act, 1867 - Two school boards passed bylaws imposing education development charges on new homes pursuant to Part III of the Development Charges Act - O'Driscoll and White, JJ., of the Ontario Divisional Court, opined that the education development charge scheme failed to explicitly guarantee, particularly at the payout stage, that the rule of proportionality as between public and separate school supporters would be observed - Part III of the Act and the regulation thereunder were therefore invalid as violating s. 93 of the Constitution Act, 1867 - See paragraphs 3, 26 to 53.

Constitutional Law - Topic 9542

Separate or denominational schools - Extent of constitutional guarantees under s. 93, Constitution Act, 1867 - [See Civil Rights - Topic 8302 ].

Education - Topic 716

Education authorities - School commissions or boards - Education development charges - [See Civil Rights - Topic 8302 , Constitutional Law - Topic 6822 and first Constitutional Law - Topic 9542 ].

Cases Noticed:

Education Act Amendment Act, Reference Re - see Reference Re Roman Catholic Separate High Schools Funding.

Reference Re Roman Catholic Separate High Schools Funding, [1987] 1 S.C.R. 1148; 77 N.R. 241; 22 O.A.C. 321; 40 D.L.R.(4th) 18, refd to. [paras. 4, 11, 31].

Halifax v. Fairbanks, [1928] A.C. 117, refd to. [paras. 16, 105].

Tiny Roman Catholic Separate School Board v. The King, [1927] S.C.R. 637, refd to. [paras. 31, 74].

Greater Hull School Board v. Quebec (Attorney General), [1984] 2 S.C.R. 575; 56 N.R. 99, refd to. [para. 32].

Reference Re Minority Language Educational Rights (1984), 4 O.A.C. 321; 47 O.R.(2d) 1 (C.A.), refd to. [para. 34].

Borowski v. Minister of Justice and Minister of Finance of Canada, [1981] 2 S.C.R. 575; 39 N.R. 331; 12 Sask.R. 420; [1982] 1 W.W.R. 97; 24 C.R.(3d) 352; 24 C.P.C. 62; 64 C.C.C.(2d) 97; 130 D.L.R.(3d) 588, refd to. [para. 55].

Finlay v. Canada, [1986] 2 S.C.R. 607; 71 N.R. 338, refd to. [para. 56].

Shannon v. Lower Mainland Dairy Products Board, [1938] A.C. 708 (P.C.), refd to. [para. 91].

Howay v. Caradoc (Township) (1991), 6 M.P.L.R.(2d) 70 (Ont. Gen. Div.), refd to. [para. 95].

Caribou College v. Kamloops (City) (1982), 18 M.P.L.R. 85 (B.C.S.C.), refd to. [para. 96].

International Aviation Terminals (Vancouver) Ltd. v. Richmond (Township) (1992), 11 B.C.A.C. 278; 22 W.A.C. 278; 9 M.P.L.R.(2d) 1 (C.A.), refd to. [para. 96].

Sorokolit et al. and Mississauga, Re (1977), 2 M.P.L.R. 249 (Ont. Div. Ct.), refd to. [para. 97].

Bank of Toronto v. Lambe (1887), 12 A.C. 575, refd to. [para. 102].

Cotton v. R., [1914] A.C. 176, refd to. [para. 104].

R. v. Caledonian Collieries, [1928] A.C. 358 (P.C.), refd to. [para. 111].

Atlantic Smoke Shops Ltd. v. Conlon, [1943] A.C. 550 (P.C.), refd to. [para. 112].

British Columbia (Attorney General) v. Esquimalt and Nanaimo Railway Co., [1950] A.C. 87, refd to. [para. 113].

Canadian Pacific Railway v. Saskatchewan (Attorney General), [1952] 2 S.C.R. 231, refd to. [para. 114].

Simpsons-Sears Ltd. v. New Brunswick and Canada (Attorney General) et al., [1982] 1 S.C.R. 144; 41 N.R. 489; 39 N.B.R.(2d) 407; 103 A.P.R. 407; refd to. [para. 118].

Charlottetown v. Foundation Maritime Ltd., [1932] S.C.R. 589, refd to. [para. 120].

Cairns Construction v. Saskatchewan, [1960] S.C.R. 619, refd to. [para. 122].

Canadian Industrial Gas & Oil Ltd. v. Saskatchewan et al., [1978] 2 S.C.R. 545; 18 N.R. 107, refd to. [para. 123].

Ellett's Estate v. British Columbia (Attorney General) et al., [1980] 2 S.C.R. 466; 32 N.R. 326, refd to. [para. 123].

British Columbia (Attorney General) v. Canada Trust Co. - see Ellett's Estate v. British Columbia (Attorney General).

Newfoundland and Labrador Corp. et al. v. Newfoundland (Attorney General) et al. - see Mining and Mineral Rights Tax Act, Re.

Mining and Mineral Rights Tax Act, Re; Newfoundland and Labrador Corp. and Javelin International Ltd. v. Newfoundland (Attorney General) and Alberta (Attorney General) et al., [1982] 2 S.C.R. 260; 43 N.R. 406; 38 Nfld. & P.E.I.R. 502; 108 A.P.R. 502, refd to. [para. 124].

Air Canada and Pacific Western Airlines Ltd. v. British Columbia, [1989] 1 S.C.R. 1161; 95 N.R. 1, refd to. [para. 125].

Statutes Noticed:

Assessment Act, R.S.O, 1990, c. A-31, generally [para. 71].

Canadian Charter of Rights and Freedoms, 1982, sect. 1, sect. 2(a), sect. 15 [paras. 4, 11, 54, 130].

Constitution Act, 1867, sect. 91 [para. 102]; sect. 92(2) [para. 2 et seq.]; sect. 92(10), sect. 92(13), sect. 92(16) [para. 92]; sect. 93 [para. 3 et seq.]; sect. 93(1) [paras. 29, 43]; sect. 93(3) [para. 74].

Development Charges Act, R.S.O. 1990, c. D-9, Part I, Part II [para. 95]; Part III [para. 2 et seq.]; sect. 29 [paras. 39, 60]; sect. 30 [paras. 17, 20, 60]; sect. 35(3) [para. 62].

Development Charges Act Regulations (Ont.), reg. 722/89 generally [para. 29 et seq.]; sect. 5(7) [paras. 40, 41].

Education Act, R.S.O. 1990, c. E-2, sect. 122(1) [para. 37 et seq.].

Municipal Act, R.S.O. 1990, c. M-45, generally [para. 71].

Planning Act, R.S.O. 1990, c. P-13, sect. 54 [para. 76].

Scott Act - see Separate Schools Act.

Separate Schools Act, 1863, 26 Vict., c. 5, sect. 14 [para. 73]; sect. 20 [para. 28 et seq.]; sect. 21 [para. 28].

Authors and Works Noticed:

Hogg, Peter W., Constitutional Law of Canada (2nd Ed. 1985), pp. 604 [para. 15]; 605 [paras. 15, 126]; 606 [para. 15]; 613 [para. 90].

La Forest, G.V., The Allocation of Taxing Power under the Canadian Constitution, Canadian Tax Paper No. 65 (May 1981), p. 90 [para. 16].

Stein, Stanley B., The Development Charges Act, 1989 - The Developer Perspective (Feb. 6, 1990), pp. 1, 2, 6 [para. 88].

Counsel:

Neil Finkelstein and George Vegh, for the applicants;

Janet Minor and Michel Helie, for the Attorney General of Ontario;

Peter D. Lauwers, for the York Region Roman Catholic Separate School Board;

Martha MacKinnon, for the York Region Board of Education.

This application was heard on September 21 to 25, 1992, before O'Driscoll, White and McKeown, JJ., of the Ontario Court of Justice, Divisional Court. The decision of the court was released on May 20, 1993, including the following opinions:

O'Driscoll, J. - see paragraphs 1 to 5;

White, J. (dissenting in part) - see paragraphs 6 to 53;

McKeown, J. - see paragraphs 54 to 131.