council decides to proceed with the construction of drainage
works, it appoints an engineer under s. 8 to plan the works,
including to assess their cost. The engineer is required to submit
a report to the municipality. If the council proceeds based on the
report, it passes a by-law adopting the report and authorizing
the drainage works.
 The engineer’s report is required to assess landowners and
utilities for benefit, outlet liability, injury liability and special
benefits (ss. 21 to 24). Section 26 allows all of the increase in the
cost of drainage works due to the presence of public utilities to
be assessed by the engineer against those utilities. The section
provides as follows:
26. In addition to all other sums lawfully assessed against the property of
a public utility or road authority under this Act, and despite the fact that
the public utility or road authority is not otherwise assessable under this
Act, the public utility or road authority shall be assessed for and shall pay
all the increase of cost of such drainage works caused by the existence of the
works of the public utility or road authority.
 Section 48(1) provides for a right of appeal by a landowner
or public utility from an engineer’s report to the Agriculture,
Food and Rural Affairs Appeal Tribunal.
 In April 2012, a landowner petitioned Norwich regarding
two improvements to the Otter Creek Municipal Drain. Norwich’s council appointed an engineer. The engineer prepared one
report for both projects, and assessed Union $1,180 under s. 26
of the Act for costs relating to boring steel pipes across the gas
main. This assessment was not disputed.
 The report also identified a conflict between a Union gas
pipeline and the proposed drainage work that would require the
gas pipeline to be moved. The report stated that if any utilities
required relocation, “the extra costs incurred shall be borne by
the utility involved in accordance with the provisions of section
26 of the [Act]”. In February 2014, the Norwich council adopted
a by-law approving the engineer’s report.
 Union did not appeal the engineer’s report. Instead, with
respect to the gas pipeline that required relocation, it issued an
invoice to Norwich seeking a 35 per cent contribution, relying on
a cost-sharing mechanism in the franchise agreement.
 The franchise agreement is based on a model franchise
agreement, whose terms were approved by the OEB in accordance with the Municipal Franchises Act, R.S.O. 1990, c. M.55.
The franchise agreement allows Union to operate its gas infrastructure within Norwich’s territorial boundaries.
 Section 12 of the franchise agreement permits Norwich to
request Union to relocate any part of the gas system where