Question:
A small commercial building located in a downtown core, where municipal sewers are available was sold multiple times over the years. The original owner purchased the property in 1992 and paid sewer fees to the town until selling 30 years later in 2022. The next owner continued paying sewer fees until they sold the building in October 2025.
The current owner, who operates a beauty salon (and therefore uses significantly more water than the prior office tenants), has just discovered that the building is actually connected to an old septic system that hasn’t been pumped in roughly 40 years. It’s completely useless and needs to be replaced. It will cost $15,000 to connect with the system.
Does the buyer have legitimate grounds to pursue the township for reimbursement or to compel them to connect the building to the sewer system, given that the town has been charging for sewer services for decades?
Answer:
It’s important to know how all this started. 60 to 70 years ago or more.
There was a changeover in many areas from septic to sewers. In some areas, sewers were brought in and homeowners had the opportunity to connect. The actual connection was usually free at the time the sewers were being installed. In some cases, everyone’s taxes went up, since this was an improvement to the neighbourhood. In other cases, it was charged or assessed as a local improvement and spread over 20 years. So, people paid for the sewers whether they were connected or not.
As you can appreciate, there were many who might say “my septic is new, works fine and I will just wait”. Everyone who connected had to pay to place the new pipes etc. on their property. The ones who didn’t connect saved some money upfront, and got to use their own septic system.
The ones who waited, eventually switched over. They were paying for sewers even though they were not connected. They still had to pay for their own pipes, and now a connection fee since the municipality no longer had contractors on site.
If that’s the case, you may find that your clients have to pay a connection fee, and the costs to run the pipes over, and there’s no refund for all those sewer fees paid over the last 50 years (the value of their property was higher since sewers were in the neighborhood).
The good news is that they saved the installation costs and the connection fees over the last 50 years or so. They could get a new septic system for $25,000 (if allowed) but, it would be less expensive to simply connect current connection fees, ($15,000 by your estimate).
You will have to confirm the facts with the particular municipality. The situation was often handled differently, subdivision to subdivision within the same municipality.
Brian Madigan LL.B., Broker