2138746 Ontario Inc. v. Friday Harbour Village Inc.
(Ontario) (Civil) (By Leave)
Property - Real property, Land registration, Easements, Civil procedure, Costs - Property — Real property — Land registration — Easements — Adverse possession — Onus of proof — Inconsistent use — Civil procedure — Costs — Whether it is perverse to reward overburdening of an easement through adverse possession unless the claimant meets a high onus — Whether standard applied rigorously — Whether registering title and granting easement to owners of neighbouring lands protects against future adverse possession claims — Whether registering easement on title serves as actual notice to subsequent owners of dominant tenement — Whether registration of easement on title bars adverse possession claims — Whether doctrine of inconsistent use was applied correctly here — Whether lower courts erred in awarding costs.
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In 1936, numerous lots were created on a triangular parcel on the shoreline of Lake Simcoe. A right of way (“Block C”) which allowed access to those lots. It was informally divided into the “Marina Strip” on lots 1 and 2, and the “Western Strip” on lots 3 5. In living memory, there had been a small marina on lots 1 and 2, a series of fences between lots 3 5 and Block C, and blockages between lots 2 and 3. In 1965 and 1975, a predecessor of Friday Harbour created an entrance channel to the marina, partially-submerging the Marina Strip and lot 1. The dredged soil was used to create new land (lots 29 and 30). In 1995, 2138746, which owned lots 3 and 4, purchased Block C.
Friday Harbour planned to develop the marina into Friday Harbour Resort, a residential commercial complex. In 2011, it applied to the Land Registrar for absolute title to lots 1, 2, 29 and 30, including the benefit of a right of way over Block C, under s. 46(2) of the Land Titles Act, R.S.O. 1990, c. L.5, s. 26. The Deputy Director of Titles held that the right of way over Block C had not been abandoned. 2138746 appealed. Friday Harbour then issued a statement of claim against 2138746 seeking, inter alia, declarations that it was the owner of the Marina Strip through adverse possession and had a right of way over the Western Strip. 2138746 defended and counterclaimed seeking, inter alia, declarations that Friday Harbour had abandoned the right of way over Block C and that its construction activities had trespassed on Block C. The trial judge declared Friday Harbour owned the Marina Strip by virtue of adverse possession, but had abandoned the Western Strip. Friday Harbour was awarded $500,000 in costs. The Court of Appeal dismissed 2138746’s appeal and Friday Harbour’s cross appeal.
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