Appeal court sides with city over Parker lands; quashes order to pay $5M

The Manitoba Court of Appeal has overturned an order that the city pay $5 million in damages over a ruling that two city employees deliberately stalled a major housing project.

A judgment released Thursday grants the city’s appeal of the decision and orders the developer to pay the city’s court costs.

“I am satisfied the trial judge made palpable and overriding errors in certain findings of fact and in the inferences that she drew from the evidence to conclude (the employees) engaged in deliberate and unlawful conduct in their capacity as public officers. In my view, the evidence falls short of establishing deliberate and unlawful conduct,” it states.

The original July 2023 judgment that sparked the municipal government’s appeal found two city employees — former chief planner Braden Smith and senior city planner Michael Robinson — liable for “misfeasance in public office.”

It ruled they had deliberately stalled Gem Equities’ Fulton Grove housing development of the former Parker lands. The project aims to create about 1,900 housing units on 47 acres of south Winnipeg land surrounded by CN Railway Rivers line and the southwest rapid transitway.

The developer alleged city officials had abused their positions by stalling progress on the development for years, which the city denied.

The judgment that awarded the damages also found the City of Winnipeg to be vicariously liable for the delay.

“Misfeasance in public office” reflects a finding of deliberately disregarding public duties with knowledge “misconduct was likely to harm the plaintiffs,” that ruling noted.

Mayor Scott Gillingham said the appeal ruling exonerates city staff, as well as Coun. John Orlikow (River Heights-Fort Garry), who was criticized in the initial decision.

“It’s good that Coun. Orlikow was exonerated in this, as were our city staff. There has to be dialogue between city staff and councillors. It’s not inappropriate. The elected officials are elected to represent their constituents,” said Gillingham. “The original decision left a lot of ambiguity and confusion as to what the role of public officials would be in working with councillors.”

The initial judgment claimed Orlikow, who was not named as a defendant in the legal challenge, interfered with the approval process, which the councillor denied.

Gillingham and Coun. Jeff Browaty (North Kildonan) said saving the $5-million payment plus court costs is also good news for taxpayers.

“Certainly, it’s beneficial for the city’s finances. Even the fact that our legal costs are going to be covered is certainly encouraging,” said Browaty, council’s finance chairman.

The mayor stressed he’s hopeful the Fulton Grove redevelopment can proceed as soon as possible.

“We, as a city, will continue to work with the developer and I’m looking forward to a full development at that site… I hope it (starts) within this year,” said Gillingham.

Gem Equities submitted a draft secondary plan to develop the Parker lands in spring 2014. However, council did not give final approval to the proposal until November 2020, after years of delays and legal battles. The approval came after Gem obtained a court order that required council to consider the project.

Contrary to the earlier decision, the appeal judgment finds the evidence “does not establish that Robinson did anything unlawful for an improper purpose or outside his statutory authority.”

It also notes “Smith’s conduct and actions do not support an inference that he acted deliberately for an illegal or improper purpose to slow down or thwart the development applications.”

And while it deems some concerns Orlikow raised “inappropriate,” such as a desire to delay the development, it finds “raising these concerns does not amount to proof that Orlikow directed the planners and that Robinson specifically followed that direction knowing it was illegal to do so.”

Since those claims were dismissed by the appeal court, the city will also no longer be held “vicariously liable,” the judgment notes.

“For all the foregoing reasons, I would allow the appeals, set aside the judgment… and dismiss the action in its entirety,” it states.

Dave Hill, a lawyer for Gem Equities owner Andrew Marquess, said Friday he was disappointed in the Court of Appeal ruling to overturn the lower court’s decision.

“I feel particularly bad for the client, who started in 2013 trying to get a project going and in 2025 it hasn’t even happened yet,” said Hill.

Hill said whether to seek leave to appeal the new decision to the Supreme Court of Canada is up to his client, but he expects they will do so.

— with files from Erik Pindera

joyanne.pursaga@freepress.mb.ca

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