Home buyers would do well to ensure that their local municipal bylaws and easements do not prohibit their development plans before they embark on any major construction or renovation projects. In a recent case, the Ontario Court of Appeal affirmed that homeowners were required to remove a pool and associated amenities that they had built on top of a municipal easement.

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In Oakville (Town) v. Sullivan, 2021 ONCA 1 (CanLII), the appellants bought a property in Oakville, Ont. and subsequently built a swimming pool and surrounding deck, platform and other amenities behind their house. The pool and amenities extended over a 10-foot strip of land that was subject to a registered easement held by the respondents, the Town of Oakville and Oakville Hydro Electricity Distribution.

The subject easement had been registered in 1972 and stated that the owners of the appellants’ property maintained “the right to use the surface of the said land for any purpose which does not conflict with the Town’s rights hereunder and specifically excluding the planting of any tree and the erection of any building or structure.”

While the appellants knew about the easement prior to closing their purchase, they apparently believed that the easement had been abandoned or never used. The only current use of the easement was as an underground conduit housing a hydro cable, providing power to a neighbouring property. Over the years, several other structures had been erected within the easement with the town’s approval, including a carport and part of the house. Two large trees are also within the easement. The town’s approval was not sought, however, before the pool and amenities were built in 2014.

In 2018, the town and Hydro brought an application for a declaration that the appellants’ pool and amenities encroached upon the easement and for an order requiring their removal. The application judge ruled that the pool and amenities actionably encroached upon the easement because they contravened the express prohibition against erecting a building or structure. He also ruled that the equitable doctrine of proprietary estoppel did not prevent the town and Hydro from enforcing their rights under the easement. As a result the appellants were ordered to remove the pool and amenities, to remediate damage to the easement, and pay costs to the town and hydro for the legal proceedings in the amount of $50,000.

On appeal, the appellants argued that the application judge incorrectly ruled that there was an outright prohibition on erecting any building or structure within the easement, regardless of whether that building or structure conflicted or substantially interfered with the rights of the easement holders. The appellants argued that the pool and amenities did not constitute an “actionable encroachment” on the easement.

In evaluating whether there is an “actionable encroachment” on an easement created by express grant, Ontario courts first determine the nature and extent of the easement by interpreting the wording of the instrument creating the easement, within the context of the circumstances that existed when the easement was initially created.

Once the nature and extent of the easement have been determined, the court then assesses whether there is a “substantial interference” with the use and enjoyment of the easement for the purpose identified in the grant. An “actionable encroachment”, which requires some remedial action to be taken by the landowner, generally depends on a finding of “substantial interference” on the use of the easement.

The appellants claimed that the easement did not limit their right to build the pool and amenities because the easement was only ever intended to be used, and has only ever been used, for a hydro line, which could be serviced notwithstanding the pool and amenities. Essentially, the appellants argued that the pool and amenities did not “substantially interfere” with the rights of the town and Hydro to use the easement and therefore they had not established the legal basis for an “actionable encroachment” requiring the offending structures to be removed.

The Court of Appeal soundly rejected this argument, concluding that the application judge had properly focused on the precise wording of the easement. In that regard, the property owners maintained the right to use the surface of the lands within the easement but were “specifically exclude(ed from) the planting of any tree and the erection of any building or structure.”

The pool and amenities obviously contravened this wording. The application judge was also entitled to conclude that interpreting the easement as an outright prohibition reflected its broad purpose of allowing the town unfettered access within the easement to provide municipal services.

Further, the Court of Appeal found that the application judge had implicitly applied the correct substantial interference test. By agreeing to an outright prohibition, without qualification, at the time the easement was granted, the parties effectively defined for themselves what would constitute a substantial interference with the easement. When an outright prohibition is contained in a registered easement, substantial interference with such prohibition is established simply by erecting any building or structure within the easement lands.

As a final pitch, the appellants raised the legal doctrine of proprietary estoppel. They argued that as a result of the town expressly permitting the construction of a portion of the appellants’ house and carport within the easement, and the town had induced, encouraged or allowed them to believe that the easement was abandoned or no longer in use. The appellants claimed that they relied on such belief when building the pool amenities.

The Court of Appeal upheld the application judge’s findings that there was no evidence to suggest that Hydro had any knowledge of the other structures located within the easement, and that the appellants made no inquiries with the town and/or Hydro about the scope of the easement or a building permit before installing the pool and amenities. Accordingly, there was no evidence to suggest that the appellants acted to their detriment when building the pool or amenities to the knowledge of either the town or Hydro.

As a result the appeal was dismissed and the appellants were ordered to pay further costs of $40,000 to the town and Hydro for the appeal, in addition to having to remove the pool and amenities by June 30, 2021.

The decision demonstrates that homeowners should never assume that easements on their lands are abandoned or will no longer be enforced according to their terms by the easement holders. In the case of registered easements, the specific wording should be examined in addition to the factual matrix existing at the time the easement was granted. Ultimately, the inclusion of prohibitions within an easement indenture may lead to proof of “substantial interference” from any encroachments or structures built upon the easement lands.

As well, homeowners should always be prudent to review the requirements of obtaining building permits before embarking on any significant renovations or construction on a property, particularly a pool. The cost of removing any offending structures and repairing the damage to the easement lands could easily dwarf the cost of the original construction.


Jonathan Nehmetallah is an associate with Gardiner Roberts and a member of the Dispute Resolution Group and the Municipal and Land Use Group.

11 COMMENTS

  1. Easements never die, they just go to sleep as new access necessary systems fall into play. But it is my understanding that even sleeping easements must be disclosed in a listing, confirmed by a copy of an existing survey sometimes.

    If not, a trigger hint for buyers: ask the question and get confirmations in hand BEFORE buying any property. You can even check the information yourself with the city.

    This is a perfect example of knowing the history of subdivisions where you work as an agent. I had insisted that my American seller disclose a sleeping easement as I had disclosed to them when they bought a few years prior. And the easement had not been divulged. I knew nearly every property had rear yard easements. So I had my foreign buyer acknowledge in their offer. Even the seller was not aware re his own property. Hard to imagine. But true.

    The then current selling buyer agent for my listing refused to disclose to his buyer. I insisted the acknowledgment clause be put in his offer, and advised my seller how important it might be, after the fact.

    The agent had lived in the subdivision himself and had grown up in the area and never heard of a problem. Back to my often comment: an agent doesn’t have “a right to an opinion.” Just do it. He nearly blew his own opportunity. Finally in frustration he acknowledged and told his buyer, inserted the clause that his buyer acknowledged the sleeping easement and the sold sign could be installed.

    Carolyne L 🍁

    • Sometimes a request can be made through the City I was told by our City years ago, to vacate the old easement. An expensive and time-consuming process even when unused hydro and phone cables would be willing. The old rear yard easements often encroach on contiguous neighbours’ properties behind and beside. It all would require a giant meeting of the minds and fees might be required by the hydro and phone companies for their investigators’ costs.

      I had a listing where several prior owners back one had installed a garden shed about 10 x 10′ on a fixed concrete base, right up tight against a rear corner fence, contiguous to neighbouring properties side and rear. The house was more than thirty years old.

      I forget the finite details but I contacted the City to seek how to satisfy the new MLS buyer and make this shed location legal, as he wanted to keep it; my seller was going back to Spain on a corporate relo. No one knew what to do about the shed.

      Somehow it had been grandfathered, i discovered, and the MLS agent’s buyer was satisfied and I had it all confirmed in writing. Everything hinges on full disclosure. There is usually a way to work things out. I always earned my commission

      Carolyne L 🍁

  2. It sounds to me like the pool was an above-ground installation. Decks surround above-ground pools whereas concrete etc. usually surrounds in-ground pools. Not that that matters much, but the owners should have simply drained the sucker and tried to fit it in off of the easement, if at all possible, once notified of the problem. The old saying, “Ignorance of the law is no excuse” holds true again. Willful ignorance is another thing altogether, if that be the case here.

    Expensive pool.

  3. My first thought was to question why applying for a permit would not have stopped this dead in its’ tracks…….buried electrical cable and pool full of water? Sounds like with a break-down in the cable that could be quite exciting! I recall a home in our area built many years ago with overhead lines nearby. Everyone who entered the space had an anxious feeling(rapid pulse) and it was related to the conduct of electricity to the pool and wet deck. The new buyers took one dip in the pool, got scared, and filled it in.

  4. Law is suppose to be fair, what is fair here is that the property owner should not have built on the easement, but the dispute could have been easily solved by Hydro and Municipality working with the home owner. There should be no need to remove the pool unless it is currently causing a problem with the maintenance of the hydro line. I doubt that there is any issue here only that the hydro want to protect their rights to someday dig up the persons property if there is ever a maintenance issue. This easement never should have been allowed in the first place and if needed should have been constructed in a way that did not affect the use of the majority of the rear yard. It is a sad day when the government can gang up on a property owner. Yes the hydro company is within their rights but the proper thing to do was to find a better solution to the problem. That is how I see if anyway, common sense is not too common anymore.

  5. The whole article I was wondering about a permit. I would think that a major undertaking of a pool installation would require one. Did the buyer install this themselves? Sounds like they did, and just carried on with it, as if they were planting a rose garden… big mistake. If they did not install themselves, is there no onus on a pool company to require such a permit, and investigate any easements that may exist, as well as proper setbacks from lot lines, etc.? I’m sure they’d have to. I guess the buyer got what they deserved. You might want to oversize your deck a little, or add a basement bathroom, and try to fudge it through without a permit, but a pool installation is a pretty big endeavour to hope that no one finds out, or complains.

  6. The final judgement looks “black and white” to me… If there’s ten foot easement, don’t build on it… Period!

  7. Total misuse of power on behalf of the city. I smell jealousy in the neighbourhood. The letter of the law can unfortunately go where logic cannot. We no longer have a judicial system bound by what is morally right or wrong but now bound to money: who has the deepest pockets and sad to say taxpayers don’t even realize the provincial body will gladly pick your pocket to sue you.
    While I don’t know the whole story, on the surface this sounds suspicious..

    • “Total misuse of power”
      Let’s face it a pool, there are many guidelines (safety being one) in place for above ground or below ground pools to be installed.
      Were there other related problems to this installation that caused concern?

      Facts mentioned by the writer:
      1) While the appellants knew about the easement prior to closing their purchase, they apparently believed that the easement had been abandoned or never used.

      2) The only current use of the easement was as an underground conduit housing a hydro cable, providing power to a neighbouring property.

      3) Over the years, several other structures had been erected within the easement with the town’s approval, including a carport and part of the house. Two large trees are also within the easement.

      4) The town’s approval was not sought, however, before the pool and amenities were built in 2014.

      Sounds like no permission or permit was granted to the homeowner/ installing homeowner.

      For the installing homeowner, it’s a well deserved very expensive schooling.

      Makes one wonder if this issue wouldn’t have been brought front & center if the current owner were to sell the property would they have disclosed the defect?

      Because the easement is registered on the title would have it been left to the unsuspecting to discover?

      How much homework do you do as a realtor? If an owner doesn’t disclose this to you, do you go digging to expose your seller client?

      As a buyer’s realtor would have you pulled the property title prior to writing the offer to purchase?
      Would have you pulled all registrations to that property title to discover all facts about the property?
      The last question, if this concern wasn’t disclosed in a purchase contract would you have the knowledge & experience to start drilling down on every registration on the title to discover possible concerns for your buyer?

      There are too many homeowners that try to get away with doing it right/correctly.

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