Casual legal: Unauthorized uses of land in expropriations
By Greg Weber
Reynolds Mirth Richards Farmer LLP
Alberta Municipalities Casual Legal Service Provider
Sometimes when a municipality requires land, the owner may be using the property in unauthorized ways. Perhaps the owner failed to comply with a development permit, or unauthorized development has occurred. In such circumstances, the Municipal Government Act equips municipalities with enforcement powers to bring the land into compliance (e.g., section 645). When such measures are taken and the owner neglects to respond, the municipality can take action to bring the land into compliance and add the costs to the tax roll.
Municipalities are often surprised to learn that things are not so straightforward when an unauthorized use of land is being dealt with for the first time within the context of expropriation. There are two key points that municipalities should know.
First, the courts have found that owners may be entitled to compensation for unauthorized uses of the land. In Thoreson v Alberta (Infrastructure), 2006 ABCA 250, the applicable municipal bylaws prohibited the development or use of certain lands other than for agricultural purposes. The landowner represented that she was building an indoor equestrian arena. Instead, she built a clothing manufacturing facility. At trial, the judge denied compensation for the building. The Court of Appeal overturned this finding and awarded the value of the building. Although it was an illegal building, she made use of it, derived a benefit from it, and she lost it due to the expropriation. It was therefore compensable.
The second point derives from the first: if unauthorized uses are occurring on land that a municipality may acquire through expropriation, steps should be taken as soon as possible to bring the land into compliance before moving to expropriation. If a municipality tolerated an unauthorized use and only moved to stop it within the context of an expropriation, the owner would have a strong argument that the enforcement steps were “coloured” by the expropriation. If this argument were successful, the municipality could be required to compensate the owner for the costs associated with bringing the property into compliance.
The lesson is simple: if land that could potentially be expropriated is being used in unauthorized ways, then municipalities should not wait to stop unauthorized uses or continue tolerating them. The consequences of inaction could prove costly.
To access Alberta Municipalities Casual Legal Helpline, Alberta Municipalities members can call toll-free to 1-800-661-7673 or send an casuallegal [at] abmunis.ca (email) to reach the municipal legal experts at Reynolds Mirth Richards and Farmer LLP. For more information on the Casual Legal Service, please call 310-MUNI (6864) or send an riskcontrol [at] abmunis.ca (email) to speak to Alberta Municipalities Risk Management staff. Any Regular or Associate member of Alberta Municipalities can access the Casual Legal Service.
DISCLAIMER: This article is meant to provide information only and is not intended to provide legal advice. You should seek the advice of legal counsel to address your specific set of circumstances. Although every effort has been made to provide current and accurate information, changes to the law may cause the information in this article to be outdated.
