Constructive Expropriation

Week 12

Find these slides online: https://webslides.baxterlab.ca/slides/property2025-26/12/
Category: Property 2025-26

Agenda

Recap: Right to Shelter
Constructive Takings
Acquired Rights

Emerging right to shelter

Availability / adequacy of shelter spaces
Overnight vs daytime shelter
Process and procedure

Constructive Takings

Recall: McLaren v Caldwell

“To attribute to the Legislature an intention so unreasonable and unjust is not justifiable unless the language is so direct and unambiguous as to admit of no doubt or other construction.”

Per Ritchie CJ, 1882 CanLII 3 (SCC)

Recall: Manitoba Fisheries Ltd.

“Once it is accepted that the loss of the goodwill of the appellant’s business which was brought about by the Act and by the setting up of the corporation was a loss of property and that the same goodwill was by statutory compulsion acquired by the federal authority, it seems to me to follow that the appellant was deprived of property which was acquired by the Crown.”

Recall: Pennsylvania Coal Co. v Mahon

“Government hardly could go on if, to some extent, values incident to property could not be diminished without paying for every such change in the general law.”

Per Holmes J

From “Private” to “Public” Land Use Control

Pre-WWII: nuisance (tort) and restrictive covenants (servitudes) as primary tools for resolving land-use conflicts and land-use “planning”
Post-WWII: rise of municipal land-use planning and zoning tools

Expropriation Act, RSNS 1989, c 156

3(1)(c) “expropriate” means the taking of land without the consent of the owner by an expropriating authority in the exercise of its statutory powers;

[…]

24 Where land is expropriated, the statutory authority shall pay the owner compensation as is determined in accordance with this Act.

Contemporary Constructive Takings

Mariner Real Estate Ltd.
CPR v Vancouver
Annapolis Group Inc. v Halifax

Can you spot the differences between these two pictures?

How to think about “takings”…

“De facto expropriation is conceptually difficult given the narrow parameters of the Court’s authority which I have just outlined. While de facto expropriation is concerned with whether the “rights” of ownership have been taken away, those rights are defined only by reference to lawful uses of land which may, by law, be severely restricted. In short, the bundle of rights associated with ownership carries with it the possibility of stringent land use regulation.”

Per Cromwell JA, Mariner Real Estate

Mariner/CPR Test

Acquisition of a beneficial interest in the property or flowing from it; and
Removal of all reasonable uses of the property

Acquisition of beneficial interest:

Note that this requirement is “unique” to Canadian law
Broad benefit to the public / enhancing the value of public land doesn’t qualify (Mariner)
Manitoba Fisheries as example: transfer of “goodwill” to the federal company was the acquisition of a beneficial interest
Re claim in CPR that use of railway as public park rejected by the court

Removal of all reasonable uses:

Not about value (but still of evidentiary use)
Determined by historical use: “not only in relation to the land’s potential highest and best use, but having regard to the nature of the land and the range of reasonable uses to which it has actually been put”
Must be ALL uses

NB re CPR: Court finds that Vancouver Charter “deems property not to have been taken” when affected by a land-use bylaw. This is not “inconsistent” with the Expropriation Act, but merely an expression of legislative intent = NO constitutional protection against uncompensated takings

Annapolis Test

Advantage flowing to the state
Removal of all reasonable uses of the property

FACTS:

private lands adjacent to BMBC conservation area (major access points); acquired in parcels by Annapolis Group since 1950s; land development wasn’t regulated until 1980s
2006 Regional Plan; designated lands “Urban Settlement” and “Urban Reserve”, contemplating future development but requiring a Council resolution to authorize a secondary planning process to open lands for serviced development
By resolution in 2016, Council declined to initiative the secondary planning process, effectively freezing development indefinitely (though not irreversibly)
Annapolis bring suit claiming de facto expropriation, alleging that HRM went beyond merely “downzoning” and actively encouraged use of lands as a “public park”

Ratio:

acquisition of an advantage rather than actual interest in land
focus is on the effect of the regulation on the landower (i.e. not on whether an interest actually acquired by the state)
addition of “owner’s reasonable expectations” to “nature of land and its historical uses”

NB “realistic appraisal in the context of the case”:

nature of the government action (targets specific owner or engages broad public policy); notice to owner at time when property was acquired; whether measures consistent with owner’s expectations
nature of the land and its historical or current use (mere reduction in value doesn’t suffice)
substance of the alleged advantage (e.g. permanent or indefinite restrictions vs temporary)

Acquired Rights

“Legal non-conforming uses”

“The objection to more sophisticated land use controls, when they emerged as an instrument of good government, was that they were to some extent confiscatory of the owner’s rights.”

Per Binnie J., Saint-Romuald (City) v Olivier

What is the justification for law protecting acquired rights?

Planning Act, CCSM, c P80

86(1) Subject to sections 88 to 91, the enactment of a new zoning by-law does not affect any of the following that lawfully existed before the enactment of the new zoning by-law:

(a) a building;

(b) a parcel of land;

Acquired rights: R v Cappy

What is the source of acquired rights?
What is the scope of these rights once acquired?

Facts:

Prior bylaw, land was used for different sporting events, including footraces (stock car racing was tried but abandoned)
Bylaw changed zoning on the land to residential uses, prohibiting any non-residential uses
Same bylaw also recognized acquired rights, i.e. that non-conforming uses could continue

NB: two different “theories” of source and three different approaches to analyzing scope acquired rights

At trial, judge held that since lands had previous been used for “non-residential purpose” they could continue to be used for any “non-residential purpose” (i.e. scope of acquired right defined by previous bylaw)
Henderson (dissent): acquired rights (before bylaw took effect) did not include “motor car racing” and this change in use generated significant noise and emissions (“During the progress of the race the cars give off very loud noises from their exhaust and from the screeching of wheels and the clanging and banging when the cars collide with each other. There are also extensive fumes from the exhaust.”)
Laidlaw (majority): “purpose was a general one” = “stadium for public amusement and entertainment and for public exhibitions and performances of all kinds”

Saint-Romuald (City) v Olivier

Source of acquired rights is actual use of the land prior to the bylaw change.

Saint-Romuald (City) v Olivier

Scope of acquired rights (and question of whether those rights were exceeded in a given case):

Intensity of use
Remoteness
Neighbourhood effects

Scope:

By rejecting the “categorical approach” (trial judge in Cappy), rejects idea that the scope is defined by authorized uses under old bylaw
Starting point is to characterize the “purpose” of the pre-existing use.
Intensity: in general, increased intensity will not invalidate acquired rights, but there is a point in which it crosses over into a different “type” (e.g. factory farm)
Remoteness: start with assessing remoteness against the purpose of the pre-existing use
Neighbouhood effects (balancing): if “new” use is WITHIN the scope of the original purpose, then court needs to “balance landowner’s interest against the community interest”

Application on the facts (Binnie):

Purpose of pre-existing use: both Binnie and Gonthier seem to agree that the pre-existing use was “entertainment”.
Intensity: no increased intensity (people, traffic, noise)
Remoteness = this seems to be the real ground of disagreement between Binnie and Gonthier; Binnie thinks both uses (Western bar and nude dancing) are “entertainment”;
- Gonthier contrasts “entertainment” with “sex” / “sexual arousal” (e.g. focusing on the addition of “private” viewing booths = reliance on the “public” vs “private” distinction). NB importance of how pre-existing purpose is characterized.
Neighbourhood effects = some dispute about, e.g. increased police surveillance but Binnie dismisses any link to criminal activity; really boils down to lack of evidence
- Gonthier seems to say that we need to consider the “moral” dimension of land use planning at this stage of the analysis – i.e., the court’s balancing isn’t just about the physical/environmental effects of the shifting use, but about the MORAL EFFECTS in light of land-use planning’s “objectives of harmonious development and welfare” (e.g. “condone the violation of respect for and the dignity of the performers”)

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