If the government makes a regulatory decision that infringes on your private property rights for a public benefit, while purposefully avoiding an obligation to pay you compensation, then you should be entitled to compensation – right? According to the current state of the law on de facto expropriation, a legal doctrine designed to protect private property owners’ rights in those very circumstances, the answer may be “not necessarily.”
Luckily, on October 15, 2021, the Ontario Landowners’ Association (“OLA”) was granted leave to intervene in the Supreme Court of Canada case in Annapolis Group Inc. v. Halifax Regional Municipality (“Annapolis”). In this case, the Supreme Court has an opportunity to make it easier for private landowners to obtain compensation when their private property rights have been infringed in this manner, and the OLA will be arguing that the law needs to change.
The appeal in Annapolis involves questions about the legal test private landowners are required to establish when making a claim of de facto expropriation against the government. In the Annapolis case, the private landowner claiming de facto expropriation was a land developer, and the government authority was a municipality that wanted to acquire the developer’s lands for a public park. However, the municipality deliberately avoided zoning the lands as parkland (which would have required it to purchase the lands under municipal legislation), and instead passed a resolution that simply refused to allow the developer to engage in any further development of its land. In the decision under appeal before the Supreme Court, the Nova Scotia Court of Appeal held there was no de facto expropriation despite clear motive on behalf of the government to avoid its obligation to pay, on the basis that the government had not actually acquired title to the lands in question. The OLA has been granted leave to make two arguments before the Supreme Court in the appeal of that decision. In short, the OLA will argue that:
1) In cases such as this one, where the government exercises its regulatory powers for the purpose of evading a statutory compensation requirement to achieve a public benefit, then a rebuttable presumption should arise that the test for de facto expropriation has been established. This means that the courts should presume in such cases that the private property owner is entitled to compensation for de facto expropriation unless the government can demonstrate that they are not; and
2) The Supreme Court should abandon the requirement in its prior jurisprudence that the government must acquire a beneficial interest in the property in order for there to be a de facto expropriation – in these circumstances, a change in the common law is warranted.
“This case is significant in that it may potentially result in a formulation of the test for government expropriation of Private Land that is more generous toward the Landowner”, said Jeff Bogaerts, President of the OLA. “Government regulatory expropriation of Private Land must be compensated. Leaving the Landowner in a position of owning the land but being unable to use it is unfair and presents a financial burden.”
The OLA is incredibly excited about the opportunity to contribute to the law on this very important topic, particularly because the issues at stake, and the Court’s ultimate decision, are squarely within the OLA’s mission and mandate, and directly affects private landowners across the country.
source: media release, OLA
photo: Jamie McCaffrey, via Wikimedia Commons
