Legislative History: Enacted September 19, 2017 (By-law No. CPOL.-185-437); Amended July 24, 2018 (By-law No. CPOL.-185(a)-444)
Last Review Date: July 25, 2023
Service Area Lead: Director, Realty Services
1. Policy Statement
The purpose of this policy is to formalize and clarify practices on the acquisition of properties required for public works projects.
2. Definitions
Not Applicable.
3. Applicability
This policy applies to all properties required for public works projects.
4. The Policy
The following Frequently Asked Questions (FAQs) shall be provided by the Civic Administration in connection with the acquisition of properties required for public works projects:
4.1 Does the city do anything before it expropriates property?
Yes it does. The City makes every effort to negotiate a fair agreement of purchase and sale with a property owner before resorting to expropriation. The City’s objective is to ensure that individual rights are respected and protected and to provide fair compensation for any property acquired within the framework of the Expropriations Act. When a project is to be constructed in phases, the City will generally try to acquire those properties that are needed first, but will nonetheless negotiate for property in any phase if the owner wishes to sell.
This is typically how it’s done. A City Realty Services representative contacts the owner to discuss acquisition terms after the City has had an independent appraisal firm appraise the agreement. The owner has the option to obtain another independent appraisal to assist them in assessing the offer of compensation, as well. (See Questions 4.2 and 4.12 below regarding owner costs).
4.2 What happens if an agreement is reached?
The owner is usually then asked to execute an "Agreement of Purchase and Sale" offering to sell their property to the City, which is then recommended to City Council for acceptance. In some extenuating situations, the City may make an offer to purchase. In either case, once the offer is accepted, a binding agreement of purchase and sale exists between the owner and the City. When a mutually acceptable agreement is reached, it is the City’s practice to pay the owner’s reasonable legal and appraisal costs after the completion of the transaction.
4.3 What can I expect to be paid for?
The amount that an owner receives covers such things as:
- the market value of the land,
- damages due to disturbance,
- damages for injurious affection, and
- any special difficulties in relocating.
4.4 What is meant by "market value"?
"Market value" is the amount that might be expected if the property were sold in the open market by a willing seller to a willing buyer. An additional allowance may be considered for improvements, the value of which may not be reflected in the property's market value, such as trees and landscaping.
4.5 What does "damages due to disturbance" include?
Where the owner resides on the property, "damages attributable to disturbance" include:
- any reasonable costs that naturally and reasonably result from the City's acquiring the property;
- an allowance for inconvenience;
- an allowance (up to 5% of the property's market value) toward the cost of finding another residence, provided the property is not already being offered for sale when the City acquires it.
4.6 When are "damages for injurious affection" paid?
Where only a portion of the property is acquired rather than everything, "damages for injurious affection" are based upon the reduction in the market value of the remaining property after the partial property purchase.
4.7 What is included in "relocation costs"?
"Relocation costs" are usually only paid when the entire property is acquired. This may include reasonable moving, legal, survey and other non-recoverable expenses incurred in the property owner acquiring other premises.
4.8 What can an owner do who doesn't feel expropriation is justified?
If following every effort to negotiate a fair agreement, it is necessary for the City expropriate a property, a "notice of intention to expropriate" is sent to the owner. Within 30 days, the owner may request a hearing of necessity into whether the taking of the property is "fair, sound and reasonably necessary" to achieve the City's objectives. The owner can appear alone or with a lawyer before the inquiry which is conducted by a provincially-appointed inquiry officer. The inquiry officer does not have authority to deal with the property's value but they must give the City Council a written opinion with reasons as to whether the expropriation is justified. After considering the report, City Council decides whether to go ahead with expropriation.
4.9 In an expropriation, when does the city own and occupy the property?
The City takes title to the property by registering an expropriation plan in the Land Registry Office. Within 30 days after that, the City serves the owner with an expropriation notice. Although the City, or its appointed appraiser, can inspect the property to appraise its value, the City cannot actually take possession until the owner has been given at least three months' advance notice. Court proceedings are available to the owner to postpone the possession date and to the City to overcome resistance to allowing possession.
4.10 Does the city make any further offer of money for the property?
Within three months of registering the expropriation plan and before taking possession, the City must offer the owner an amount in full compensation together with the appraisal report upon which the offer is based. If the owner agrees with the amount offered, the matter can be settled at this point. If not, the owner can still have the money paid to them and have the value established by the Board of Negotiation or the Ontario Municipal Board.
4.11 How does the question of compensation get before the Ontario Municipal Board?
Two separate boards exist to deal with property value: the Board of Negotiation and the Ontario Municipal Board. Either the owner or the City can apply to either board. The Board of Negotiation meets with the owner and a City representative at the property and attempts in an informal way to negotiate a complete settlement. The Board of Negotiation recommendation is not binding on either part. If a settlement is not reached at the Board of Negotiation hearing, the Ontario Municipal Board can arbitrate the dispute. The matter can go directly to the Ontario Municipal Board, but only if the owner and the City agree to by-pass the Board of Negotiation. The OMB decision is binding, unless appealed by either party to the Divisional Court.
4.12 Who pays the owner's costs in having compensation determined?
If the amount determined by the Ontario Municipal Board represents 85 per cent or more of the amount offered by the City before expropriation, the owner is entitled to be reimbursed for reasonable legal, appraisal and other costs actually incurred for determining compensation. The owner is also entitled to be paid interest on any outstanding difference between the Board's award and any payment made previously by the City.
NOTE: This brochure answers the most common questions an owner may have whose property is affected by a public works project. Because this has been prepared for information and convenience only, it is not intended to be an authoritative digest of expropriation law or of the City's policies and procedures. A lawyer should be consulted for specific legal advice; however any further questions you may have about this subject may be directed to:
Director, Realty Services
Realty Services Division
The Corporation of the City of London
P.O. Box 5035
London, Ontario N6A 4L9
519-661-5442