Focus: Spike in expropriation work noted by lawyers

As subway and LRT projects grow across Ontario cities, municipal and land use lawyers say they’re getting an “incredible amount of work” in what they call a very specialized area of the law.

“I can’t tell you how many files we’ve already gotten on the LRT here in Toronto dealing with Metrolinx, the Eglinton Crosstown, the TTC Vaughan extension, and the various matters dealing with the YRT in York Region, especially along Highway 7 where they’re putting the bus corridor,” says John Mascarin, partner and a member of the municipal and land use planning group at Aird & Berlis LLP.

As residents and businesses receive expropriation notices due to transportation projects, lawyers say they’ve been fielding calls from clients whose land rights are impacted. In fact, some lawyers say there has been a spike in expropriation work since about 2009 due to several rapid transit initiatives.

In addition to Toronto’s Eglinton Crosstown project, an LRT construction work has choked up Waterloo’s King Street. Meanwhile, plans are underway to build rapid transit systems in Scarborough, Mississauga, and Hamilton. Claims also arose from vivaNext’s road-widening project on Davis Drive in Newmarket, Ont., to make way for a new bus system.

“Firstly, the roads are generally not wide enough for these projects to go ahead properly so they end up having to expropriate land. Typically, they expropriate a part of somebody’s land, so that means the piece that’s left is generally impacted,” says Stephen D’Agostino, expropriation lawyer at Thomson Rogers.

“In the case of some of these projects, there is also temporary easements taken, which bind the land for three, five, [or] 10 years depending on how long the construction is going to be and then they give it back. So you’ve got the burden of the temporary expropriation,” D’Agostino adds.

The actual expropriation of land is not necessary to bring claims under the Expropriation Act, Mascarin explains, adding businesses can also bring claims for loss of income as a result of the construction projects.

“For example, a plaza loses its ability for people to make left-hand turns into it. That’s certainly a potential for damage claim that they could potentially claim under the Expropriation Act even when there is no expropriation of land itself,” he says.

But while businesses can bring claims for damages due to the construction of a project, they cannot bring claims for damages due to the use of that project after its completion, according to D’Agostino.
That’s only one of the many finicky aspects of the Expropriation Act that requires specialized knowledge of this area of the law, lawyers say.

“It’s a confusing area, especially for claims that are based on business loss and other damages,” says Shane Rayman, expropriation and litigation lawyer at Rayman Beitchman LLP. “If you’re expropriating someone’s home, you can pretty much say, ‘This is what the home is worth,’ and if an expropriating authority makes a fair offer, you don’t really need an expropriation lawyer; you need a real estate lawyer to finish the closing.”

But things are more complicated when the claim is about the loss of business or it has to do with a complicated property, Rayman adds.

“You have to understand the law around it and you need to have the right experts to give you the advice that you really are going to require if you want to pursue the claim,” he says, adding lawyers may need the help of engineers, business loss valuators, land use planners, or economists.

On the plus side, the Expropriation Act allows for claimants to be compensated for their legal fees as long as they have received 85 per cent of the offer made by the expropriating authority. But there is a catch, Rayman says. “The kicker is, it’s not costs [that are covered]. It’s reasonable costs,” he says.

That’s partly why it’s important that professionals who do this work really know what they’re doing, Rayman adds. “If you’ve never done it before, your costs might not be considered reasonable. You have to figure out whether something is within your area of expertise and whether you’re the lawyer who could deliver the best result for a client.”

When the matter is fairly simple, such as cases where there are no questions around the fairness of the offer made by the expropriating authority, “then I don’t believe it requires specialization,” Rayman adds. “But when an owner doesn’t think they have a fair offer and they need to figure out what is a fair offer, I recommend that it goes to a specialist,” he continues. 

Mascarin says his one caution for lawyers doing expropriation work is around the strict deadlines involved. “The one thing that we certainly find is that it’s a very specialized area and timelines and procedures are absolutely imperative to be followed,” he says.

“If you miss a deadline, it could preclude you from receiving proper payments.

“On the other hand, if you’re acting for the expropriating authority, you miss deadlines and you could lose your ability to expropriate land in a timely way,” he adds.

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