A Hamilton developer has moved on from his dream of building a medium density residential complex on a former auto wrecking yard in the West Harbour precinct; but he still hopes to be compensated for 15 years of delays that he blames on the city of Hamilton. Marino Rakovak who heads up the consortium White Star Group charges the city put what should have been routine condo approvals on hold—twice—in 2000 as it pursued two failed attempts for building a stadium in the area—first for the Commonwealth Games and later for the Pan Am games. White Star sued the city for moneys lost over the period. The city countered by disqualifying White Star from receiving land remediation grants and condo development financing because it was suing the city. The property is now up for sale to a developer who will not be caught in the legal net and will qualify for the development grants. White Star still has property in the area that is zoned for commercial development.
Meanwhile, in an attempt to push the city into considering the compensation claim a lawyer representing White Star has warned the city that it could be on the hook for millions, if it continues to stonewall White Star on compensation. Citing a 1990 Supreme Court of Canada ruling, lawyer Ron Folkes has asked the city to take part in a voluntary arbitration of the dispute at the Ontario Municipal Board but the city has refused to participate. The next step will be an application to force the city to take part in an OMB hearing.
The Supreme Court ruling, which found against the predecessor of GO transit; concerned a developer’s parcel of land in Mississauga that was put into limbo as GO tried to decide which of two sites to expropriate for a GO station. An interpretation of the judgment written by the firm Miller Thomson concluded, “The compensation meter starts running from the moment the developability of the land is brought into question and continues to run until the land is finally taken.” In the case of White Star that could mean it would be eligible for not only its initial losses, but for interest accumulated over 15 years as was awarded in Mississauga. Miller Thomson says the court ruling shifts the onus from proving damages, or lack of, back to the expropriating body, in this case the city, rather than forcing the plaintiff to justify claims. White Star estimates it has lost nearly $8 Million as a result of the delays.
White Star also accuses city legal staff of not following a council directive in 2010 to consider compensation for the developer. Instead, according to White Star’s lawyer, Hamilton legal staff ran out the clock to the last council meeting just before the municipal election of 2010, where all unresolved matters died pending the election of a new council. Wrote White Star lawyer Folkes, “If the (City of Hamilton) does not fulfill the procedural requirements set out in the expropriation legislation, and act in a timely manner, it will be found to have acted without authority and arbitrarily which will lead to compensation for business losses suffered by the landowner/developer. In such instances, the Courts have held that the burden of proof in the land-taking process is usually on the expropriating authority (Hamilton).”