Executive Summary: Key Legal and Evidentiary Issues

• The court had to determine whether Ministry representatives owed Horizon a duty of care regarding statements made during the Renewable Energy Approval (REA) process.
• Ontario contended that a 2013 release, signed to settle an earlier mandamus application, barred Horizon's claims arising from pre-2013 conduct.
• Issue estoppel and abuse of process arguments were raised by Ontario based on Horizon's unsuccessful 2014 mandamus application and its withdrawn appeal of the REA refusal.
• Four specific alleged misrepresentations by named Ministry officials formed the core evidentiary dispute in Horizon's negligent misrepresentation claim.
• Whether Fort William First Nation's litigation effectively gave it a "veto" over the REA decision became a central factual and legal question.
• Damages methodology was addressed by the court even though liability was not established, distinguishing lost-profit claims from lost-investment claims.

Facts of the case

Horizon Wind Inc., together with Big Thunder Windpark Inc. and Big Thunder Windpark Limited Partnership (collectively, "Horizon"), sought to develop an onshore wind project near Thunder Bay, Ontario. Horizon invested roughly $10 million between 2005 and 2014 pursuing the project. In April 2010, Horizon entered into a feed-in-tariff ("FIT") contract with the Ontario Power Authority ("OPA"), which required Horizon to obtain a Renewable Energy Approval ("REA") from the Ministry of the Environment before submitting a Notice to Proceed. Horizon submitted its first REA application in February 2011, followed by subsequent applications in 2012. The application was deemed complete in April 2013, triggering a technical review. Fort William First Nation ("FWFN"), whose traditional territory bordered the project site, opposed the project and, in March 2014, commenced judicial review and injunction proceedings alleging inadequate Crown consultation. Horizon separately brought an unsuccessful mandamus application in 2014, which the Divisional Court dismissed. When Horizon failed to obtain the REA by its extended deadline, the OPA terminated the FIT contract in July 2014. The Director ultimately refused Horizon's REA application in October 2015, citing unanswered questions about the project's impact on moose and moose habitat. Horizon sued for negligent misrepresentation (having withdrawn a parallel misfeasance in public office claim), seeking either lost profits — valued at $50 million in its Statement of Claim, with expert evidence at trial suggesting up to $58 million — or, alternatively, lost investment costs, pleaded at $10 million in the Statement of Claim and later put at $12.9 million at trial.

Policy terms or contractual clauses at issue

The FIT contract gave the project the right to sell 16,500 kilowatts of wind energy to the provincial grid at 13.5 cents per kilowatt hour, and obligated Horizon to submit a Notice to Proceed request by an initial deadline of January 14, 2011. Horizon invoked the contract's force majeure clause to extend that deadline first to August 8, 2013, then to July 17, 2014; the OPA was entitled to terminate the contract if the deadline passed without an REA in hand, which is what occurred. Separately, a release Horizon signed in 2013 to settle its first mandamus application purported to release Ontario from claims "relating to, or arising from or out of, or in connection with the matters in dispute" in that application. The court held that, read in light of the surrounding circumstances at the time of signing, the release could not reasonably be construed to bar the later-crystallized negligent misrepresentation claim, since the technical review had not yet begun and neither party could have anticipated how events would unfold.

Reasoning and analysis

The court first rejected Ontario's preliminary defences. It found the pleadings adequately captured the misrepresentations argued at trial, that the 2014 mandamus decision addressed a different question (a legitimate-expectation timing argument) than the negligent misrepresentation claim now advanced, and that no abuse of process arose because no prior factual findings were being relitigated. On duty of care, applying the test from Aylmer Meat Packers Inc. v. Ontario, the court found the harm reasonably foreseeable, since Ministry staff knew Horizon would lose its FIT contract absent a timely REA, and found sufficient proximity given years of direct, substantive interactions between Ministry representatives and Horizon, including guidance Horizon relied on and implemented. No residual policy reason barred the duty, since the representations were operational rather than true policy decisions, and imposing a duty to be accurate would complement rather than conflict with the Ministry's regulatory role. Turning to the four alleged misrepresentations, the court found that the claim the REA process was "efficient, fair and streamlined" traced only to a government press release, which cannot ground tort liability because the Crown itself cannot be sued directly in tort. The claim that the application would be considered without political interference was found, on the evidence, to be factually accurate: the Director's decisions to defer and then refuse the REA were rooted in the statutory "public interest" test and the Crown's duty to consult, not political pressure, and testimony from former Premier Wynne, MPP Mauro, and Ministry witnesses was uncontradicted on this point. The claim that a completed technical review would guarantee immediate approval was unsupported, since Horizon understood the six-month service standard was aspirational and that further information could be requested. Finally, the claim that Ministry officials misrepresented that FWFN lacked a "veto" was found accurate as a matter of law, since Supreme Court authority establishes that the duty to consult is a right to a process, not to a particular outcome or a veto.

Ruling and overall outcome

The court concluded that no Ministry employee made an actionable negligent misrepresentation to Horizon: representations attributable to the government itself could not ground tort liability, and any representations attributable to individual officials were factually correct. Although the court found the Ministry did owe Horizon a duty of care, it dismissed the action because no breach of that duty through misrepresentation was established, and it therefore made no finding on reliance or damages. Ontario, as the defendant, was the successful party. Because the action was dismissed, no monetary award was ordered or granted in favour of either party; the court noted only that, had liability been found, it would have awarded Horizon a portion of its lost investment costs plus a reasonable rate of return, rather than the lost-profit figures Horizon sought, but this remained hypothetical given the dismissal. The parties were directed to resolve the issue of costs between themselves, with the court retaining the ability to set a timetable for costs submissions if needed.