Supreme Court docket of Canada Expands Scope of Constructive Taking Motion

In a latest resolution, the Supreme Court docket of Canada (“SCC”) has expanded the scope for constructive taking (additionally known as de facto expropriation) claims. They’ve eliminated the requirement to point out {that a} authorities has acquired a useful curiosity within the related land whose growth rights they impair. This requirement has been changed with the a lot broader class of demonstrating that the federal government has obtained an ‘benefit’ wanting a real useful curiosity. The requirement that the land be left with none cheap use stays.

In Annapolis Group Inc. v Halifax Regional Municipality, 2022 SCC 36 (“Annapolis”), a developer had sought to develop its lands since 2007, making a number of makes an attempt which have been in the end refused. The municipality had, since 2006, adopted a 25-year planning technique which reserved a portion of the related lands for a future park. This prevented serviced growth of the lands with no municipal decision. Annapolis sued, alleging a constructive taking, on the premise that the municipality meant by no means to permit it to make use of its land aside from as a park.

The municipality sought abstract dismissal on the premise that there had been no “acquisition of a useful curiosity” by the municipality, required by the earlier main case, Canadian Pacific Railway Co. v. Vancouver (Metropolis), 2006 SCC 5, [2006] 1 S.C.R. 227 (“CPR”), and no removing of all cheap makes use of for the lands, which might nonetheless be used as a park.

Annapolis received on the SCC in a call that, whereas purporting solely to make clear the CPR take a look at, expands the scope of what constitutes a constructive expropriation, hopefully enhancing the power of property homeowners affected by governmental regulatory takings to assert compensation.

On the coronary heart of the courtroom’s resolution is the alternative of the standard have to show authorities has acquired an precise useful curiosity within the land whose use is regulated, with the necessity solely to point out authorities acquires a bonus or profit.

This may presumably make it simpler for property homeowners whose growth rights have been curtailed by down-zoning or different rules for park, watershed or different governmental objective, to assert compensation.

We count on there to be important litigation within the subsequent few years testing the bounds of the brand new ‘benefit’ criterion. The SCC has sought to information this interpretation, noting that to make sure substance over kind, a courtroom ought to contemplate the character of the governmental motion, the character of the land and it’s historic and present makes use of, and the substance of the alleged benefit.

Individually, the Annapolis resolution confirmed that whereas the intent of the municipality (right here, to in the end flip the land right into a park) was not a part of the take a look at, it was a related consideration, helpful in distinguishing sometimes broad down zonings from focused constructive takings.

This too might strengthen the place of landowners, introducing a persuasive evidentiary software to point out extreme authorities motion.

Ought to you could have any questions in regards to the resolution, please contact Jim Fraser, Tom Boyd, or one other member of our Actual Property Group.

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