Executive Summary: Key Legal and Evidentiary Issues

• Whether the Trial Judge erred by treating the parties' 2022 easement release agreement as a global release of all claims, including pre-agreement nuisance claims.
• Interpretation of the deeded right-of-way was disputed, particularly whether it extended to the waterfront of the Trent River.
• Evidentiary gaps undermined the Appellant's case, as his testimony referred largely to unidentified "people" rather than linking offending conduct to the Respondents.
• Failure to call the land surveyors as witnesses meant the claimed west limit of the right-of-way was never properly established in evidence.
• Costs issues arose under s. 29 of the Courts of Justice Act (15% cap), Rule 14.07 (doubling of costs after an unbeaten offer), and Rule 19.06 (penalty costs).
• Application of the appellate standard of review from Housen v. Nikolaisen governed whether the Trial Judge's findings disclosed palpable and overriding error.

Facts of the case

Frank Polat and Dale and Krista Richardson are next-door neighbours on Highway 33 in the Town of Frankford, Ontario, with properties fronting on the highway and backing onto the Trent River. Until mid-2022, the properties shared a driveway located on Mr. Polat's land, over which the Richardsons held a deeded right-of-way ("ROW") registered as Instrument QR273607 and described as Parts 1 and 2 on Registered Plan of Survey 21R4460. Mr. Polat admitted that the period before 2022 was characterized by increased use of the ROW by people and vehicles not associated with the Richardsons, including groups gathering at the shoreline, vehicles parked near the water, and on one occasion a water truck drawing water at the river's edge. After disputes about the ROW's use, the parties entered into "An Agreement to Release and Abandon an Easement" on April 22, 2022, under which the Richardsons released their interest in the ROW in exchange for $16,000 to construct a driveway on their own property. Shortly afterward, Mr. Polat installed a perimeter fence, new gate, and pillars, and no further incidents took place. Mr. Polat nevertheless sued in Small Claims Court for $35,000 in damages for wrongful use of the ROW, the construction costs of the fence, gate, and gate pillars, and for trespass, nuisance, and lack of reasonable enjoyment of his property. Deputy Judge E. Kafka dismissed the claim on November 25, 2024, and awarded double and punitive costs against Mr. Polat in the amount of $14,077.00. Mr. Polat appealed to the Divisional Court, which heard the matter by Zoom at Belleville on May 11, 2026.

Policy terms and contractual clauses at issue

Two instruments were central. First, the deeded ROW in Instrument QR273607 granted a "free and uninterrupted right-of-way, in common with the Grantor, for persons and vehicles through, along and over" the lands described as Parts 1 and 2 on Plan 21R4460, with Part 1 shown running from the boundary of Highway 33 to the Trent River with no apparent gap between the ROW and the river. Mr. Polat contended that the ROW ended before the shoreline, relying on a dotted line on a later plan, Plan 21R-17756, marked "Travelled Right-of-Way as set out in Inst No. 273607," but the court found this a fundamental misinterpretation, as that notation was clearly not meant to delineate the limits of the ROW. Second, the 2022 Agreement released the Richardsons' interest in the ROW for $16,000; notably, issues regarding prior conduct were not addressed in that agreement. On costs, three provisions were engaged: s. 29 of the Courts of Justice Act, which caps Small Claims Court costs at 15% of the amount claimed or recovered (exclusive of disbursements and taxes, subject to exceptions); Rule 14.07 of the Rules of the Small Claims Court, which permits doubling of costs from the date of an offer that is not beaten; and Rule 19.06, which authorizes a penalty where a party or representative has unduly complicated or prolonged the proceeding or otherwise acted unreasonably.

The court's reasoning and analysis

Applying the standard of review from Housen v. Nikolaisen — correctness for questions of law and palpable and overriding error for questions of fact — Justice Labrosse addressed three grounds of appeal. On the first ground, the court concluded that the Trial Judge did not treat the 2022 Agreement as a global release; had he done so, most of his analysis of the evidence would have been moot. Although the Trial Judge described it as "unseemly" that Mr. Polat intentionally omitted his nuisance claims from the 2022 Agreement, he never stated that the agreement released those rights, and he examined the pre-2022 evidence in detail. That evidence was replete with references to "the people" or "they" without any specific link to the Richardsons; Mr. Polat acknowledged that he did not know most of the people using the ROW, that in some exhibit photographs the vehicles were parked on the Richardsons' own land rather than on the ROW, and that he never saw the Richardsons dump anything on his property. On the second ground, the court found that Mr. Polat never established that the ROW stopped short of the shoreline; he did not call the surveyors whose invoice he relied upon, and he could not contradict Plan 21R-4460, which shows the ROW extending to the waterfront. Since the ROW granted free and uninterrupted passage for persons and vehicles over that area, it was open to the Trial Judge to prefer Dale Richardson's straightforward evidence and to conclude that the use made of the ROW did not offend its terms; occasional wrong-area parking or a truck accessing the ramp to draw water on limited occasions would not qualify as nuisance. On the third ground, the court upheld the doubling of representation costs from the s. 29 cap of $5,250 ($35,000 x 15%) to $10,500 under Rule 14.07, based on the Richardsons having beaten their October 3, 2023 offer to settle. However, the $3,500 penalty imposed under Rule 19.06 could not stand: the evidentiary record showed activity within the ROW that could at times be questioned against its permitted use, so the claim was not meritless, and the Trial Judge's reasons fell short of establishing that Mr. Polat unduly complicated or prolonged the action or otherwise acted unreasonably. That finding was a palpable and overriding error.

Ruling and overall outcome

The Divisional Court granted the appeal in part: the Trial Judge's finding on penalty costs was overturned, while the appeal was otherwise dismissed. The Richardsons therefore remained the substantially successful parties, with the underlying dismissal of Mr. Polat's $35,000 claim and the doubled costs award both upheld, and the proper award of costs in their favour was fixed at $10,500 plus $77.00 for disbursements — a total of $10,577.00, down from the $14,077.00 originally ordered. As for the costs of the appeal itself, no amount was determined; the parties were encouraged to resolve that issue, failing which each may file written costs submissions of no more than three pages within the timelines set by the court.