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Municipal Law - Powers of municipality - Services and utilities - Types - Water - Sewer

Thursday, March 30, 2017 @ 8:00 PM  

Motion by the Corporation of the Town of Arnprior for summary judgment dismissing the action by the plaintiff, Nylene Canada. The plaintiff operated a polymer manufacturing facility within the Town. It alleged the Town overcharged it for provision of wastewater services from 2005 onward, as it invoiced on the basis of the amount of water supplied rather than the lesser amount of wastewater discharged into the sewage system. The plaintiff submitted that it was accordingly overcharged for wastewater services it did not use. The plaintiff argued that s. 394(1)(c) of the Municipal Act prohibited imposition of a fee based on use or consumption of a service other than a service provided or performed by a municipality. The Town sought summary judgment dismissing the claim on the basis that imposition of charges for wastewater services was a policy decision that attracted statutory immunity.

HELD: Motion allowed. Based on the grammatical and ordinary meaning of s. 394(1)(c) of the Municipal Act, the Town provided wastewater discharge services to the plaintiff. It installed municipal sewers and a treatment plant to treat all of the water discharged into its sewage system. The wastewater service rates were based on a cost recovery estimate for providing those services provided by an engineering study. The services were provided directly to the plaintiff and did not involve charges or services external to the relationship between the plaintiff and the Town. The amounts charged were based on a reasonable estimate of the Town’s costs to provide wastewater services, and resulted in a slight loss to the Town. The fees charged were not arbitrary and could not be regarded as a tax. The Town was therefore not prohibited from making the policy decision to charge for wastewater services it provided based on the amount of water supplied to a ratepayer. The Town was protected by statutory immunity pursuant to s. 450 of the Act.