HomeMy WebLinkAboutCS 70-05 REPORT TO
EXECUTIVE COMMITTEE
Report Number: CS 70-05
Date: September 1,2005
From:
Gillis A. Paterson
Director, Corporate Services & Treasurer
Subject: Outstanding Recovery of Water Bomber Costs
Recommendation:
1. It is recommended that.Report CS 70-05 of the Director, Corporate Services &
Treasurer be received and that:
2. the outstanding account receivable billed to Christopher Burkholder in the amount
of $42,532.10 be written off in 2005; and,
3. the appropriate officials of the City of Pickering be authorized to take the
necessary action to give effect hereto.
Executive Summary: Report CS 47-04 "Outstanding Recovery of Water Bomber
Invoices" was presented to Council on December 13th, 2004 and Council decided to
refer this issue to the former Solicitor for the City. In August, 2005 upon the hiring of
the new City Solicitor this file was passed to him for his consideration and review. In
summary he has concluded that:
"In my opinion, there is no legal basis upon which the City can recover from Mr.
Burkholder the monies paid to the Ministry of Natural Resources for the service of
the water bomber fleet."
Therefore, it is recommended that Recommendation 2 be adopted and the amount be
written off in 2005.
Financial Implications: If Council decides to write-off this amount, the expense will
be charged to the City for the 2005 fiscal year (Account 2136 - Provision for Accounts
Receivable Write-off). The additional expense will be accommodated through
unanticipated under expenditures or higher revenues throughout the Corporation during
2005.
Report CS 70-05
Subject: Outstanding Recovery of Water Bomber Costs
Date:
September 1, 2005
Page 2
Background: A bailing machine caught fire in Mr. Burkholder's field located in the
City. The fire spread throughout the field and the City's Fire Services Division called
the Ministry of Natural Resources (MNR) air water bomber fleet to control and
extinguish the fire. The officer in charge of the firefighting efforts, observed flames
approximately 20 feet high and considered there to be a threat to a house, barn and
large combines. The fire was extinguished and the City was invoiced by MNR in the
amount of $42,532.10 for the services of the water bomber fleet. (The water bomber
fleet consisted of: one spotter plane, one water bomber and one helicopter). When the
City received the invoice from MNR, the City obtained a legal advice from Mr. Reble as
to whether the City should pay the outstanding invoice. Mr. Reble advised that the City
should pay the invoice and that the City could recover its costs.
Collection Activity
During the last few years, the City has pursued the collection of the outstanding invoice.
The insurance adjuster representing Mr. Burkholder (Kellow & Associates) has been
questioning the City's legal authority to bill for the additional costs. The City has
provided the documentation supporting the City's position that it has the authority to
collect or recovery the costs. The insurance adjuster and Mr. Burkholder's insurance
company are resisting payment and basically are stating that the City has "no
jurisdiction to recover payment".
Using Alternative Collection Avenue
Early in 2004, the Director, Corporate Services asked the City's insurance adjuster to
assist in the collection of the outstanding invoice. The City's insurance adjuster spoke
several times with David Kellow of Kellow & Associates trying to effect a settlement of
the outstanding invoice. David Kellow's last position on this issue was that they were
not interested in settling and that they were prepared to pursue a legal defence of the
claim.
Exploring The Fire Protection and Prevention Act (FPPA) as a Collection Tool
After the unsuccessful attempt by the City's insurance adjuster, staff wanted to explore
alternative non-legal court cost options. One alternative explored was reviewing the
Fire Protection and Prevention Act and using the legislative powers through the Fire
Marshal's Office. FPPA does allow the Fire Chief to issue an "ORDER" to recover
costs incurred by the Municipality. However, the ORDER is issued based on Section 15
of the FPPA. Section 15 provides that if the Fire Chief has reasonable grounds to
believe that a risk of fire poses an immediate threat to life, he or she may enter any land
or premises for the purpose of removing or reducing the threat and may under 15 (1)(g),
do anything he or she has reasonable grounds to believe is urgently required to remove
or reduce the threat of life. Staff discussed using this section of FPPA with the City's
Fire Chief Mr. Bill Douglas. However, it is the Fire Chief's opinion that Section 15's
Report CS 70-05
Subject: Outstanding Recovery of Water Bomber Costs
Date: September 1,2005
Page 3
intent is to be used to remove a fire threat or possibility of a fire starting and not as a
retroactive collection tool. In other words, if there was an unsafe situation such as a
huge pile of tires mixed with empty gas cans - the Fire Chief could have an outside
contractor clean-up the area and then issue an invoice for the cost of the clean-up to
the property owner. The Fire Chief also stated that the Fire Marshall Office has issued
very few orders for cost recovery.
Conclusion
In conclusion this matter has been outstanding for a long time. Several opinions have
been provided on the inability to recover beyond the attempts already taken therefore, it
is time to bring the matter to a close by writing off the amount of $42,532.10.
Attachments:
Not applicable
Prepared By:
Stan Karwowsk~
Manager, Finance & Taxation
Prepared / Approved / Endorsed By:
Gillis A. Paterson
Director, Corporate Services & Treasurer
GAP:vw
Copy: Chief Administrative Officer
City Solicitor
Recommended for the consideration of
Pickering Cit. y Council /,-~ ~
,'l'/h/or~'~ J. Quint, Chief ~dministra"~t~i