Bill 185: The Proposed Restriction of Third-Party Planning Appeals – Brave New World, or Pandora’s Box?

On April 10^th, 2024, the Provincial Government introduced Bill 185, the Cutting Red Tape to Build More Homes Act, 2024. Currently in its second reading, the stated goals of the Bill include expediting housing construction by cutting red tape and streamlining approvals. Bill 185 proposes to amend fifteen different statutes in pursuit of these goals, but perhaps most notable for the municipal bar will be the removal of third-party appeals to the Ontario Land Tribunal (“OLT”) regarding certain planning matters.

Should Bill 185 be enacted as currently proposed, the right to appeal municipal decisions regarding the adoption of official plans and the passing of zoning by-laws to the OLT would be restricted to: “public bodies” or “specified persons” who made oral or written submissions to Council prior to a decision being made; the Minister; and the appropriate approval authority. In the case of amendments to official plans and zoning by-laws, the appeal rights to the OLT would be restricted to: the applicant; “public bodies” or “specified persons” who made oral or written submissions to Council prior to a decision being made; and the Minister. “Public Bodies” and “Specified Persons” are defined in the Planning Act and generally include government, utility boards and agencies. Importantly, the restriction would apply universally to all planning instruments, regardless of whether they are initiated by a private applicant or a municipality.

The proposed amendments purport to apply retroactively. All existing third-party appeals at the OLT which did not have a hearing on the merits scheduled before April 10^th, 2024, would be automatically dismissed. This would include matters where a mediation, case management conference or any other step in the appeal process, including a contested motion, has been scheduled, but a date for a merit-hearing has not yet been granted.

This removal of third-party appeal rights follows an earlier attempt of same in Bill 23, the More Homes Built Faster Act, 2022. Introduced on October 25, 2022, Bill 23 first proposed substantively identical third-party appeal restrictions to those proposed in Bill 185, except that it also restricted third party appeals of minor variance and consent applications, and the retroactive date was for a hearing on the merits scheduled before October 25, 2022. However, except for the removal of third-party appeals for minor variance and consent applications, for which appeals are not permitted today, these proposed amendments were struck by the standing committee and removed from the Bill before it received royal assent. Notably, Bill 185 is currently before the standing committee, and it remains to be seen whether the proposed appeal restrictions will be enacted as currently drafted.

While third parties involved in minor variance and consent applications were typically limited to adjacent residents, official plan amendments (“OPAs”) and zoning bylaw amendments (“ZBAs”) often have a broader impact, affecting larger populations and areas. This, in combination with Bill 185’s retroactive application, means the proposed removal of third-party appeals will have significant implications on the rights of interested parties and the development process overall.

Implications for Municipally Initiated Planning Instruments

When it comes to municipally initiated updates to comprehensive zoning bylaws or official plans, Bill 185 may curb notorious “not-in-my-backyard” appeals, thereby facilitating quicker implementation of the density-improving measures that many municipalities are enacting. However, to achieve the stated goals of Bill 185 - expediting housing construction and streamlining approvals - it will be up to municipalities to ensure that their official plan and comprehensive zoning by-laws contain these density-improving measures and follow the Provincial direction set out in the Growth Plan that density targets are minimums, not maximums.

Critics may argue that lack of third-party appeal rights for municipally initiated planning instruments will lead to downzoning some properties, or further restrictions on development, with no recourse. For instance, “secondary plans”, as implemented through OPAs, often face appeals related to height and density limits that can hinder housing production. New comprehensive zoning by-laws may result in inadvertent downzoning of properties that had previously secured development rights under a previously enacted zoning bylaw. Consequently, landowners may find themselves navigating lengthy and expensive OPA or ZBA application processes to regain these rights where a third-party appeal existed beforehand.

Implications for Privately Initiated Planning Instruments at the OLT

For privately initiated ZBAs and OPAs, removal of third-party appeals carries substantial implications for approval timelines. In the 2022-2023 calendar year, only 40% of cases before the OLT underwent a hearing within 120 days, and only 55% of decisions were released within 30 days of hearing completion.[1] While an appeal may be filed by an applicant for a “non-decision” of a municipality within the prescribed timeframes under the Planning Act, third-party appeals filed subsequent to municipal approval would, on average, extend the approval process by at least 150 days, and usually more.

Although statistics regarding third-party appeals are not provided by the OLT, a report by the Altus Group to the Building Industry and Land Development Association regarding the Toronto Local Appeal Body (“TLAB”) is a helpful comparator. The report finds that from 2017 to 2019, third-party appeals of minor variance and consent applications represented 40% to 67% of all appeals to the TLAB.[2] If these proportions hold true for cases before the OLT, the elimination of third-party appeals would significantly reduce the number of cases before the Tribunal. Consequently, the timelines for remaining appeals would also be positively impacted.

In addition, since third parties are still permitted to seek Party Status to an OLT appeal filed by the applicant, it is anticipated that applicants will be less likely to file appeals for “non-decisions”, to avoid having third parties who may oppose their application being granted Party Status. This could potentially extend the application process leading up to a municipal decision, as the urgency for municipalities to avoid landowners filing appeals for “non-decisions” might be reduced. Thus, where timelines for the OLT approval process may improve, there is a possibility that municipal processing times will not improve concurrently.

Crucially, not all third-party appeals lack merit. A significant number of third-party appeals originate from adjacent landowners – some of whom have already submitted or intend to submit their own OPA or ZBA applications. These landowners harbour legitimate concerns regarding potential impacts on the developability of their own properties or concerns relating to ensuring that infrastructure costs that may have been, or will be front-ended, are shared equitably. While, prior to Bill 185, third-party appellants were required to engage with municipalities through oral or written submissions before appealing to the OLT,[3] the elimination of these appeals now places the responsibility squarely on municipalities to identify and address such issues during the approval process. Although an application to the Ontario Superior Court to challenge a municipal bylaw based on illegality or bad faith remains a remedy under the Municipal Act 2001,[4]  carelessness/mistakes by municipal planners and oversight of planning issues during development review are not grounds for appeal. If a municipality can demonstrate that a bylaw was legal and passed in good faith, such mistakes and oversights are irrelevant to the courts on such appeals.

Opening Pandora’s Box?

Recent jurisprudence on the availability of judicial review raises another concern regarding whether the objectives of Bill 185 will be fully realized. Applicants in planning matters, long relying on appeals to the OLT as their primary route to challenge a municipality’s decision, may now seek judicial review at the Divisional Court if their concerns remain unaddressed during the municipal planning process.

In Canada (Minister of Citizenship and Immigration) v. Vavilov the Supreme Court of Canada clarified the “reasonableness” standard of review, holding that this included instances where a decision maker “has fundamentally misapprehended or failed to account for the evidence before it”.[5] In Canada Post Corp. v. Canadian Union of Postal Workers, the Supreme Court of Canada applied Vavilov and confirmed that “recitation [of evidence] is not justification” for a decision.[6]

Despite this, in Loeb v. Toronto (City), a recent Ontario Divisional Court decision, the Divisional Court dismissed an application for judicial review of a 2022 decision of the Toronto Committee of Adjustment, where the applicants took the position that the Committee’s decision was procedurally unfair because among other things, it did not adequately explain the reasons for the decision. The judicial review was brought by two neighbours who were unhappy with the approval and unable to appeal to the TLAB due to Bill 23. The Divisional Court dismissed the application, in part because it determined that: “it is unlikely that the legislator intended, by removing the right of third parties to appeal to the TLAB, that those parties be able to proceed directly before this court.”[7]

More recently however, in Yatar v TD Insurance Meloche Monnex, the Supreme Court of Canada confirmed the availability of judicial review remains a matter of first principles, and that even where legislation provides an appeal lies on “a question of law only”, an application for judicial review remains available for questions of fact, or mixed fact and law.[8] Where Loeb appears to have closed the door to judicial review where appeal rights under the Planning Act are restricted, Yatar may reopen it. However, the application of Yatar raises questions of efficiency.

The supply of housing is scarce, but judicial availability is even more so. In Hryniak v. Mauldin, the Supreme Court declared that “[e]nsuring access to justice is the greatest challenge to the rule of law in Canada today.”[9] This decision has since been cited in over 5000 cases and is still widely cited.[10] The removal of third-party appeals may create availability before the OLT while inadvertently redirecting these appeals to the courts, at great time and expense. In Humberplex Developments Inc. v. Ontario (AG), an application for judicial review of regulations under the Planning Act, filed before the divisional court in July 2021, was only heard in March 2024, representing a timeline of 33 months.[11]

Conclusion

As currently proposed, Bill 185 presents a double-edged sword. While streamlining approval timelines and process before the OLT, the unintended consequence may be an increase in timelines for municipalities to process and make decisions on applications, and an increase in judicial review applications, further straining an already scarce resource — access to justice. Only time will tell if the policy objective is worth the costs.

Any article or other information or content expressed or made available in this Section is that of the respective author(s) and not of the OBA.