More than 21 businesses along the light rail transit route have taken the first step in legal action against the Region of Waterloo.
Documents obtained by CTV News through a freedom of Information request show that as of December, 21 businesses had filed notices reserving their right to pursue legal action over losses they sustained during construction of the LRT line.
Coun. Tom Galloway, who chairs the regional committee overseeing the LRT project, says he’s aware of “a couple more” companies that have since joined the list.
“We’re not really expecting a deluge, because the construction is for the most part complete,” he said in an interview.
One of the companies pursuing legal action is grocery giant Loblaw, whose Valu-Mart store in uptown Waterloo is along the Ion route and was impacted by construction.
In an email to CTV News, a Loblaw spokesperson declined to elaborate on the reasons behind the company’s claim.
“We don’t believe it would be appropriate to provide context at this time,” the email said.
Provincial law allows for businesses affected by construction to be reimbursed for their losses.
Under the Expropriations Act, businesses can make claims against the government carrying out the project. If the parties don’t settle before, an Ontario Municipal Board hearing then determines the award. The government would then likely be ordered to cover the legal and expert costs of any business awarded a claim.
Toronto-based lawyer Shane Rayman currently represents about a dozen businesses impacted by LRT construction in Waterloo Region.
He says that in general, he has found the region to be “very reluctant to agree to any business damages or losses arising from the LRT works” – a stance which, he says, could ultimately drive up the costs to the region.
“Over time, they realize they’re going to have to pay compensation either way – and the sooner they come to terms with it, they’ll reduce their own legal costs,” he said.
Rayman estimates that some of the largest claims in Waterloo Region could run into the millions of dollars, while smaller claims would be for tens of thousands of dollars. Those numbers don't include legal costs, which he says can top $250,000 per side if the case ends up at the OMB.
“If you have to keep fighting, if you have to prove everything … it can become very, very substantial,” he said.
The region does not have a specific budget earmarked for damages related to business losses from LRT construction.
Galloway explains this as the region not wanting “people to think that there’s a pot of money there that they simply need to apply for.”
As a result, Galloway says, any settlements reached before the case makes it to the OMB and any payments ordered by the OMB would come out of one of the region’s “property tax-funded accounts.”
Should that happen, there is the possibility that the payment wouldn’t be the end of the issue.
Galloway says the region would be able to go after construction consortium GrandLinq for reimbursement over any issues where it believes GrandLinq, and not the region, was at fault.
With reporting by Abigail Bimman
