TORONTO, (Jan. 7, 2005) — The owner and operator of Ontario’s private toll highway north of Toronto says the provincial Liberal government has finally lost its fight to control toll rates after a Justice of the Superior Court of Ontario upheld an independent arbitrator’s decision yesterday that the company is not required to obtain any other Government approval to hike tolls.

Justice Maurice Cullity stated at the conclusion of the case, “in view of the above findings, the (government’s) appeal is dismissed.”

Through the Ontario Ministry of Transportation, the McGuinty government has been trying to wrestle control of toll rates since its pre-election promise to roll back any increase to 2 per cent, plus inflation.

However, 407 ETR — a private consortium that bought the 108-km highway from the Conservative government in 1999 for $3.1 billion — has maintained the existing contract it signed with the Tories allows the company to raise rates at its own discretion without government interference.

In June, after negotiations failed to reach an agreement, a third-party arbitrator sided with the highway’s operator 407 ETR. Not satisfied, the Ontario government appealed, claiming the highway company was in default of the contract and had to submit for government approval a Change Request if it wanted to raise tolls. That led to yesterday’s court ruling by Justice Cullity, who also threw the government’s case out.

“Both an independent arbitrator and now the Ontario Court of Justice have completely confirmed our legal right to set tolls,” Enrique Diaz-Rato, president and CEO of 407 ETR, said in a press release. “We were always very confident that these disputes had no legal merit and that we were acting fully within the contract.”

Meanwhile, the ruling will give the company the ammunition it needs to raise tolls yet again. Like clockwork, the company has announced its annual New Year rate hike, which it says will help pay for more lane expansions.

Starting Feb. 7, operators of heavy single unit vehicles (straight trucks) will pay an extra two cents/km, while heavy-duty trucks will face a three-cent increase. That means in non-peak hours rates for straight trucks and tractor-trailers will go to 28.20 cents and 42.30 cents/km respectively; during peak traffic hours straight trucks will face a 29.90, while semis will pay 44.85.

Despite the multiple blows the Liberals have taken in this legal battle, Transportation Minister Harinder Takhar was still not ready to throw in the towel. “We will be considering this decision very carefully once we have had the chance to review it. I will make further comment in the coming days,” he said in a release. “It’s important to keep this in perspective. This is only one decision. There are still a number of other legal disputes that have yet to be settled. Our fight to make this contract work for the people of Ontario is certainly not over.”

But opposition critics say it’s time the government concede defeat and end this yearlong conflict, which has come at taxpayers’ expense. Conservative Leader John Tory said the Liberal government was never in a position to make such a “reckless election promise” to consumers, as the deal is governed by a contract.

Tory officials, as well as third party legal experts and financial agencies familiar with the contract, warned the McGuinty government in 2003 that it never had a legal leg to stand on in promising to freeze tolls.