Battle between district association, developer over condo project raises issue of SLAPP lawsuits

Canwest News

When David Donnelly took up the fight against developers of a $1-billion condo and marina complex slated for cottage-country north of Toronto, the environmental lawyer anticipated a hard fight.

But after losing before the Ontario Municipal Board in 2007, Donnelly and his client, the Innisfil District Association, were soon battling the developer's claim to recoup $3.2 million in legal costs. Donnelly, named in the claim, felt he was in the fight of his life.

He and other environmental watchdogs considered it a "strategic litigation against public participation" lawsuit, or "SLAPP" -- an example of an increasingly common legal gambit.

"Developers are targeting small town activists, the 'concerned citizens' groups, because they're most vulnerable," said the lawyer, who was named Earth Day Canada's "hometown hero" for 2008 at the height of his legal battle. "So many groups have chosen silence over financial ruin."

Although 26 U.S. states have enacted protections against SLAPP suits, in Canada only Quebec has such a law. But what constitutes a SLAPP suit is a matter of debate. And some provinces -- including British Columbia, which repealed an anti-SLAPP law that was briefly on the books in 2001 -- say existing laws adequately protect citizen protesters against abuse of process.

Developers argue that hobbling the ability to recoup expenses after a court win emboldens anti-development hardliners to defame them or, in the name of environmentalism or another cause, to stall or derail worthy projects.

"There's a misnomer out there, that as soon as there's a lawsuit it's a SLAPP," said Earl Rumm, chief executive of Kimvar Enterprises Inc., the developer of the contested 1,000-slip marina, 2,000-unit condo/ hotel complex and golf course planned for Big Bay Point on Lake Simcoe.

"We went after our costs ... which we were entitled to do. We didn't sue anybody."

By the time Environmental Defense -- the organization formerly helmed by Donnelly -- intervened with the Innisfil District Association to fight the development, the original application filed in 2002 had undergone extensive revisions after a series of public consultations, had cleared three levels of government, and had the backing of 'thousands of pages' of expert scientific and environmental studies, says Rumm.

At the costs hearing, the developer sought an award five times higher than the biggest in Ontario legal history. And protesters scoffed at some of the items in the $3.2-million calculation: they included a slice of chocolate cake, $38 for a 10-litre bucket and a hacksaw, and a $45 bug jacket, among others.

But Rumm estimates he had spent at least $5 million fighting local opposition and securing multiple permissions to develop his land. The fight has been "brutally expensive," he says. Getting $3.2 million back, by his own calculation, seemed a bargain.

"I can assure you that Mr. Donnelly drank the coffee and ate the cake," says Jeffrey Davies, of Davies Howe Partners and counsel for Kimvar, referring to some of the disputed expense items. That's because Kimvar had to pay the facilities costs of the hearings, which were held at an area hotel and included a daily refreshment bar, he says.

Donnelly and the Innisfil District Association also dragged out the fight, according to Davies. "They kept raising all sorts of arcane scientific points, sending us after all kinds of red herrings and we had no choice but to go there."

When the OMB decision was handed down in 2008, Lake Simcoe cottagers and Donnelly weren't ordered to pay the developer anything. But they had spent over a year, and an estimated $1.25-million, defending themselves.

It was a partial victory for the developer as well. The OMB rejected the environmentalists' argument that the high cost claim had been meant to stifle protest -- it wasn't a SLAPP, the judgment said.

Kimvar's development plans have since been grandfathered under Ontario's new Lake Simcoe Protection Act. This winter, over the objections of environmentalists, tree-clearing sanctioned by the Lake Simcoe Conservation Authority and Town of Innisfil went ahead.

Rumm said he feels victimized by groups including Environmental Defense, which "have vowed to use every tactic they can to continue to stall us" in getting further permits, he says.

"They refuse to acknowledge that leading-edge environmental studies have been applied to the development plan," Rumm's lawyer adds.

"They just keep turning a blind eye."

The battle over the future of this cottage country haven continues. At the same time, momentum is building for the creation of a new anti-SLAPP law in Ontario. The province's environmental commissioner Gord Miller has called SLAPP suits "a contagion."

Some 62 municipalities, including the cities of Toronto, Hamilton, Oakville and Aurora, have adopted resolutions demanding legislation to protect grassroots activism. And the province is said to be weighing its options.

Anti-SLAPP laws "can't come too soon," says Donnelly, "because our democracy is suffering, people are really under siege."