Expropriation Law: 2021 A Year In Review

• Published date: 28 February 2022
• Subject Matter: Litigation, Mediation & Arbitration, Real Estate and Construction, Trials & Appeals & Compensation, Real Estate
• Law Firm: Gowling WLG
• Author: Mr John Doherty, Roberto Aburto, Sahil Shoor, Carolina Campos and Tristan Neill

Our national Expropriation Law Group summarizes several complex and compelling expropriation cases from across Canada in 2021. The team highlights a number of important issues and key takeaways for those parties involved in the expropriation process. The court decisions are not listed in rank order.

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Table of content

1. Halifax Regional Municipality v. Annapolis Group Inc.2021 NSCA 3, 2021 CarswellNS (NSCA)
2. Annapolis Group Inc. v. Halifax Regional Municipality, 2021 CarswellNS 455 (SCC)
3. Halifax County Condominium Corporation No. 277 (Re), 2021 NSUARB 130
4. Tri-C Management Limited v. Nova Scotia (Attorney General), 2021 NSCA 26
5. Her Majesty the Queen (Minister of Transportation) v. Soucy, 2021 NBCA 11
6. The Corporation of the City of Windsor v Paciorka Leasehold Limited, 2021 ONSC 2189 (Div Ct)
7. Widmer-Adelaid Corp. v. Toronto (City), 2021 CarswellOnt 12266 (OLT)
8. Metrolinx v. 1450638 Ontario Inc., 2021 ONSC 8045
9. Southwind v. Canada 2021 SCC 28
10. Madison Holdings Ltd. v. Winnipeg (City of), 2021 MBCA 94
11. Northern Cross (Yukon) Ltd. v. Yukon (Energy Mines and Resources), 2021 YKSC 3 & 2021 YKCA 6

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1. Halifax Regional Municipality v. Annapolis Group Inc., 2021 NSCA 3, 2021 CarswellNS 4 (NSCA)

2. Annapolis Group Inc. v. Halifax Regional Municipality, 2021 CarswellNS 455 (SCC)

The Plaintiff, Annapolis Group Inc. (Annapolis) claimed that Halifax Regional Municipality (Region) had de facto expropriated its lands by refusing to proceed with a secondary planning process, a mechanism that is required to advance the lands toward serviced development. Annapolis argued the Region was exercising dominion over its lands by encouraging members of the public to utilize the lands as a park, and had an ulterior motive to refuse the secondary planning process. The Region's motion for summary judgment of Annapolis's claim was dismissed, and the Region appealed that decision.

The Court of Appeal found that Halifax's refusal did not amount to a de facto expropriation. The Court reiterated the two elements that constitute a de facto expropriation - the taking of lands and a corresponding deprivation of all reasonable uses, and further summarized what qualifies as a de facto expropriation and what does not, as follows:¹

1. The acquisition must be one that confers a beneficial interest on the authority alleged to have expropriated the land. Land must actually be taken from an owner and acquired by the authority;
2. All reasonable uses to which the property could be put must be removed. The burden of proving all reasonable uses have been removed is on the land owner;
3. The freezing of development and restrictive land use regulation, in and of itself, does not amount to de facto expropriation;
4. The decrease in the value of land does not amount to de facto expropriation; and
5. The passing of a development plan does not constitute a taking, it simply allows a municipality to set a vision and course for future development and ensures the land will be used or developed in accordance with its vision.

The Court of Appeal also concluded that the motive of an expropriating authority is not a factor in the analysis of a de facto expropriation. Improper motive does not create an alternative way of proving the claim and cannot compensate for the failure to establish the required elements of a de facto expropriation. Where an authority has acted in an inappropriate manner, the Court noted that parties could more appropriately proceed with a cause of action for abuse of, or misfeasance in, public office.

Annapolis was unable to demonstrate that there was a deprivation of all reasonable uses of the lands, and its allegations of improper motive were not material to the claim.

On June 24, 2021, leave to appeal was granted to the Supreme Court of Canada, and the appeal will be heard in February 2022.

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3. Halifax County Condominium Corporation No. 277 (Re), 2021 NSUARB 130

In 2017, the Halifax Regional Water Commission began upgrades on a drainage system that ran through an easement on the Claimant's lands. The upgrades required excavation and expansion, which caused parts of the drainage system to protrude above the ground. The Claimant maintained that the upgrades impaired the use of the easement lands and sought damages for injurious affection. Under the Act, a claim for "injurious affection" can be made when a "statutory authority acquires part of the land of an owner" causing a reduction in market value and personal or business damages. The Claimant argued that the degree of impairment caused by the upgrades constituted an "acquisition of land by a statutory authority". In the alternative, the Claimant argued that the original expropriation of the easement in 1972 formed the basis of expropriation and justified its claim for injurious affection.

The Board considered two key issues under the Expropriations Act: (1) whether upgrades to a drainage system constituted "acquisition of land", and (2) whether a claim for injurious affection can relate back to an expropriation of an easement in 1972. On the first point, the Board held that the Respondent's activities did not amount to expropriation under the Act. In its statutory interpretation...