



COURT OF APPEAL FOR BRITISH COLUMBIA




Citation:



Young v. British Columbia,









2016 BCCA 25




Date: 20160122

Docket: CA42529

Between:

Timothy Young and
Seamus Young

Appellants

(Plaintiffs)

And

Her Majesty the
Queen in Right of the Province of
British Columbia and the Minister of Environment

Respondents

(Defendants)




Before:



The Honourable Mr. Justice Chiasson

The Honourable Mr. Justice Frankel

The Honourable Mr. Justice Fitch




On appeal from:  An
order of the Supreme Court of British Columbia,
dated December 29, 2014 (
Young v. British Columbia
, 2014 BCSC 2445,
Vancouver Registry S141625).




Counsel for the Appellants:



D.B. Kirkham, Q.C. &
  P.J. ONeill





Counsel for the Respondents:



B.A. Carmichael &
  E.L. Ross





Place and Date of Hearing:



Vancouver, British Columbia

October 26, 2015





Place and Date of Judgment:



Vancouver, British
  Columbia

January 22, 2016









Written Reasons by:





The Honourable Mr. Justice Chiasson





Concurred in by:





The Honourable Mr. Justice Frankel

The Honourable Mr. Justice Fitch








Summary:

The Province expropriated 12
of 28 mineral claims owned by the appellants.  This seriously impacted the
appellants ability to access the remaining 16 claims.  The trial judge
dismissed their application for damages for injurious affection. Held: appeal
dismissed.  On a plain reading of the applicable legislative provisions,
compensation is confined to the fair market value of the mineral titles taken.  The
phrase consequential damages includes damages for injurious affection.

Reasons
for Judgment of the Honourable Mr. Justice Chiasson:

Introduction

[1]

This appeal concerns whether damages for injurious affection are
available to a mineral claims holder when the Crown expropriates some of the
holders claims for a park which results in interference with the holders
ability to access remaining claims.

Background

[2]

In 1999, the appellants began to acquire mineral claims in an area of
British Columbia.  As of 2008, they owned 28 adjoining mineral claims.  The
claims were registered variously in the name of either of the appellants or
sometimes in both their names.

[3]

Initially, the appellants mineral claims were legacy claims.  In
2006, they abandoned and relocated many claims as cell claims.  The claims in
issue on this appeal are cell claims.

[4]

The Province discussed the relevant legislative framework in its factum:

23.       Until its repeal in 2005, section 32 of the
Mineral
Tenure Act
permitted the recorded holder of a mineral title to group
mineral titles. In order to be grouped, the titles had to be in the name of the
same recorded holder, and had to be adjoining. There was no requirement to
group mineral titles; it was optional at the discretion of the recorded holder.

24.       Amendments to the
Mineral Tenure Act
in 2004
introduced the concept of amalgamation of mineral claims. Section 24.2
permits adjoining cell claims (all of the relevant claims held by the
plaintiffs are cell claims) to be amalgamated with other cell claims if they
are held by the same recorded holder. In the event of amalgamation, one mineral
title is issued for all amalgamated cells.

25.       Both grouping (available until 2005) and
amalgamation (from 2004 onward) require a positive step by a recorded holder,
and result in a registration in the Mineral Title Registry (section 5).

26.       In order to group or
amalgamate claims, the claims need(ed) to be held by the same recorded holder (
Regulation
,
s. 1 (definitions);
Mineral Tenure Act
, s. 24.2).

[5]

The appellants did not apply to group their legacy claims and did not
seek to amalgamate their cell claims.  They assert that they were prevented
from amalgamating due to the size of the claims.

[6]

In June 2008, the Province expropriated 12 of the appellants 28 mineral
claims.  For the purposes of this appeal, it is assumed that this seriously
impacted the appellants ability to access the remaining 16 claims.

[7]

In 2012, the appellants brought a petition seeking a declaration that
they were entitled to be compensated as if their claims had been grouped. 
Madam Justice Russell did not accede to this contention (
Young v. British
Columbia (Energy and Mines)
, 2012 BCSC 1369).

[8]

Subsequently, the Province and the appellants settled the compensation
payable for the 12 expropriated mineral claims.  It was agreed that the
associated release was not intended to apply to the [the appellants] common law
claims for injurious affection.

[9]

On February 27, 2014, the appellants filed a notice of civil claim
seeking judgment for damages for injurious affection.  They subsequently
filed a summary trial application seeking judgment in the amount of $3,000,000
or alternatively for a determination that [they] are entitled, as a matter of
law, to compensation to the extent that the unexpropriated mineral titles
sustained injurious affection, with damages to be proved subsequently.  At the
hearing of the application the appellants limited their remedy to the
alternative position.

[10]

Mr. Justice Truscott dismissed the application.

Chambers Reasons

[11]

The judge noted that the appellants position was that this Courts
decisions in
Rock Resources Inc. v. British Columbia
, 2003 BCCA 324, 229
D.L.R. (4th) 115, and
Adroit Resources Inc. v. HMTQ (British Columbia)
,
2010 BCCA 334, 6 B.C.L.R. (5th) 244,

are determinative of the present
case.  The Province asserted that these cases no longer are applicable because
the legislative scheme has changed.

[12]

The judge reviewed the decision of Russell J. and the positions of
the parties advanced before her.  He noted that settlement of the claims
related to the 12 expropriated mineral claims and also noted the release.  He
then turned to
Rock Resources
.

[13]

Referring to the judgment of Chief Justice Finch, Truscott J.
stated:

[30]

He
determined that a plain reading of s. 11(c) of the
Park Act
, 1979,
was not conclusive on the issue of compensation for mineral claims, as the
provision was silent in that respect. He said mineral claims were excluded from
s. 11(c) of the
Park Act,
1979, only indirectly, through an
amendment to s. 21(2) of the
Mineral Act
, S.B.C. 1977, c. 54

that deemed mineral claims to be a chattel interest and not an interest in
land, and he said if the legislature had intended not to pay compensation for
an expropriated mineral claim after 1977, it would have done so in a more
direct and explicit fashion.

[31]

For
those reasons, he determined that there was nothing in the
Park Amendment
Act
1995, read in the context of the legislative scheme as a whole, nor in
the circumstances in which the legislation was introduced, that would clearly
rebut the presumed intention that compensation would be paid.

[32]

His conclusion was the
presumption of full compensation should prevail and the authorized taking of
the plaintiffs rights in the mineral claims required the Crown to pay full
compensation for the value of those lost rights.

[14]

The judge discussed the applicable legislative scheme.  Section 11(2)(c)
of the
Park Act,
R.S.B.C. 1996, c. 344, authorized the Province to
expropriate mineral claims.  Compensation is to be determined in accordance
with section 17.1 of the
Mineral Tenure Act
[R.S.B.C. 1996,
c. 292].  He quoted s. 17.1:

17.1 (1) If, after the coming into force of this section, the
minister responsible for the administration of the
Park Act
expropriates under section 11 of the
Park Act
the
rights of a recorded holder of a lease or claim or of an owner of a Crown
granted 2 post claim, compensation is payable to the recorded holder or owner,
as the case may be, in an amount equal to the value of the rights expropriated,
to be determined under the regulations.

(2) If the minister responsible
for the administration of this Act and the recorded holder or owner, as the
case may be, do not agree as to the amount of compensation that is payable
under subsection (1), the minister or the recorded holder or owner may
require the dispute to be settled by a single arbitrator who has the prescribed
qualifications and is to be appointed by the minister.

[15]

The applicable regulations are the
Mining Rights Compensation
Regulation,
B.C. Reg. 19/99 [
Compensation Regulation
]
.


They
provide:

5 (1) The value of an expropriated mineral title must be
determined by estimating the value that would have been paid to the holder of
the expropriated mineral title if the title had been sold on the date of
expropriation, in an open and unrestricted market between informed and prudent
parties acting at arms length.



(5) The value of an expropriated
mineral title must not include consequential damages caused to the expropriated
mineral title holder as a result of the expropriation or the expenditures
incurred in acquiring or operating an equivalent mineral title elsewhere.

[16]

The judge then reviewed the positions of the parties.

[17]

After commenting further on
Rock Resources
and
Adroit,
the
judge observed that the appellants entitlement to compensation beyond what
they received for the 12 expropriated claims depends  on the issue of the
proper statutory interpretation of the new legislative scheme (at
para. 60).  The parties were and are in agreement that there is no common
law right to compensation for injurious affection.

[18]

The judge discussed s. 5(5) of the
Compensation Regulation
:

[72]

The
wording of s. 5(5) deals with what the value of an expropriated title must
not include by way of consequential damages, but the consequential damages not
to be included are those caused to the expropriated mineral title holder (not
to the expropriated title) as a result of the expropriation or the expenditures
incurred in operating an equivalent mineral title elsewhere.

[73]

Accordingly, the wording
supports the plaintiffs submission that this issue is to be determined on the
basis of a partial taking and not a no taking, following
Adroit
Resources
.

[19]

The judge referred to a number of texts and case authorities that describe
damages for injurious affection as consequential damages.  He held:

[83]

On the strength of these
decisions it is my determination that s. 5(5) of the
Compensation
Regulation
evidences a clear legislative intention to deny compensation for
injurious affection as consequential damages to an expropriated mineral title
holder.

For this reason, he dismissed the appellants application.

[20]

The parties did not argue cause of action estoppel or abuse of process
arising out of the decision of Russell J.  The judge raised, but did not
decide, the issue.

Positions of the Parties

[21]

The appellants contend that the judge misconstrued s. 5(5) of the
Compensation
Regulation
.

[22]

The Province asserts that the judge correctly interpreted the statutory
scheme.  It also states in its factum that:

To the extent the appellants are
relying upon a statutory provision as authority for their injurious affection
claim, the claim is
res judicata
(cause of action estoppel), or
alternatively, an abuse of process, and should be dismissed.

[23]

The appellants addressed this contention in their reply contending that
the decision of Russell J. did not concern whether the statutory scheme
allowed for a claim for damages for injurious affection and after her decision
it was necessary for them to bring the present action.

Discussion

[24]

Chief Justice Finch summarized the relevant law in
Rock Resources
:

[136]    Whether or not
compensation is payable for the taking of a property interest, therefore, is a
question of the intention of the legislature.  The ordinary rules of statutory
interpretation are relevant to the determination of legislative intent.  In
addition, there is a presumption, based on justice and fairness, that the Crown
will pay full compensation.  A clear contrary intention is required to rebut
the presumption.

[25]

The Chief Justice also quoted from the reasons for judgment of Mr. Justice
Lambert in
British Columbia Medical Association v. R. in Right of British
Columbia

(1984), 58 B.C.L.R. 361 (C.A.), which emphasize that the
interpretive exercise is not a purely mechanical matter of examining the
legislation and asking whether there is an express written reference to the
fact that the taking is to be without compensation.  Lambert J.A. added:

the rule does not override the
legislative intention.  It is not a device by which the courts can enable a
claimant to outwit the legislature.

[26]

The appellants contend that s. 5(5) should not be interpreted to
exclude damages for injurious affection because at the time it was enacted
mineral claim holders could group claims and effectively receive compensation
for claims not expropriated, but affected adversely by the expropriation, but
since 2004 with the initiation of the cell claim regime, some holders cannot
obtain the same benefit.  They assert that it is not appropriate to limit the
scope of compensation based on a pre‑existing legislative scheme.

[27]

At the core of the appellants submission is the proposition that
because legacy claims could be grouped and s. 17.1(1) of the
Mineral
Tenure Act
provides for compensation in an amount equal to the value of
the rights expropriated, s. 5 of the
Compensation Regulation
should
not be construed to take away their right to injurious affection.  They state
in their factum:

How can a regulation promulgated
in 1999, which expressly recognized injurious affection for legacy claims, be
interpreted to deny injurious affection in respect to cell claims, which only
came into existence in 2004?

[28]

The question is premised on the conclusion that the regimes changed. 
That is, that the ability to group legacy claims or to amalgamate cell claims
differs substantively.  In my view, it does not.

[29]

When enacted, the regulation expressed the Legislatures intention that
expropriated holders of so‑called legacy claims that were not or could
not be grouped would not be entitled to consequential damages.  If claims were
grouped the issue of consequential damages did not arise.  The same is true of
cell claims that are amalgamated.

[30]

Section 6 of the
Compensation Regulation
gives the holder of
grouped claims that are partially expropriated and the expropriation
eliminates the feasibility of exploiting the remaining portion a right to be
compensated based on the value of all mineral titles in the group.  The cell
regime permits the amalgamation of cell claims which then are treated as one
claim.

[31]

Under both regimes the ability to group or amalgamate is constrained
both by size and the need for adjoining claims to be held by the same entity.

[32]

The purpose of the introduction of the cell claim regime was
administrative.  Rather than require claims to be staked on the ground, they
can be established using an electronic grid (British Columbia, Legislative
Assembly,
Hansard
37th Parl., 5th Sess. (21‑22 April
2004) at 10274, 10388 (Hon. R. Neufeld).  There is nothing to suggest
that the rights of claim holders, or any limitation on their ability to obtain
compensation if claims are expropriated, changed.  The ability to group or to
amalgamate was and remains constrained.  Recovery of consequential damages was
and remains prohibited.

[33]

In my view, the issue is whether damages for injurious affection are
consequential damages.

[34]

The appellants state that s. 5(5) of the
Compensation Regulation
is limited to consequential damages caused to the expropriated title
holder in respect to the value of an expropriated title.  They assert that
the section does not apply to injurious affection, which is the loss of value
to other property and that [t]here is nothing in [the section] which
indicates that damage to
other
property was the intended subject matter
of s. 5(5) (emphasis in original).  The appellants contend that s. 5(5)
is limited to damages arising from an expropriation, such as disturbance
damages.

[35]

The starting point is s. 17.1 of the
Mineral Tenure Act
.  It
provides for compensation to the holder of a mineral claim equal to the value
of the rights expropriated as determined by regulation.

Section 5(1)
of the
Compensation Regulation
deals with the value of an expropriated
mineral title.  It is to be determined by estimating the fair market value of
the title.  Section 5(3) provides some guidance to the evaluator and subsection (4)
excludes certain factors from consideration.  Section 5(5) excludes
consequential damages caused to the expropriated
mineral title holder
as
a result of the expropriation (emphasis added).  In my view, this fits
squarely within the classic definition of injurious affection: damages
sustained to other property held by the expropriated party (
Antrim Truck
Centre Ltd. v. Ontario (Transportation),
2013 SCC 13, [2013] 1 S.C.R. 594

at para. 4).  I agree with the judges conclusion that the
consequential damages not to be included are those caused to the expropriated
mineral title holder (not to the expropriated title) as a result of the
expropriation.

[36]

Section 5(5) also excludes expenditures incurred in acquiring or
operating an equivalent mineral title elsewhere.  In the context of an
expropriation, such expenditures generally are considered to be disturbance
damages (
Adroit Resources Inc. v. HMTQ,
2009 BCSC 841 at para. 268,
referring to Eric C.E. Todd,
The Law of Expropriation and Compensation
in Canada
, 2nd ed. (Scarborough Ont.: Carswell, 1992) at p. 274).

[37]

In my view, on a plain reading of the applicable legislative provisions,
compensation is confined to the fair market value of the mineral titles taken.

[38]

If the inquiry were confined to determining generally whether damages
for injurious affection are consequential damages, I would reach the same
conclusion.

[39]

Consequential damages is a broad concept.  It has been defined as:

Losses that do not flow directly
and immediately from an injurious act but that result indirectly from the act. (
Blacks
Law Dictionary
, 10th ed. 2014).

Consequential damages have been described as that loss
which is related to the circumstances of the particular claimant (Harvey
McGregor,
McGregor on Damages
, 19th ed. (London: Sweet &
Maxwell, 2014) at 3‑008.)

[40]

Conceptually, I see no basis for concluding that damages for injurious
affection are not consequential damages.

[41]

In the context of expropriations, the Province relies on comments in two
well-respected texts.  The judge referred to these comments:

[65]      The Province relies for its submission that
consequential damages within s. 5(5) of the
Compensation Regulation
includes
damages for injurious affection, on the statement of E.C.E. Todd,
The Law of
Expropriation and Compensation in Canada
(2d ed.) 1992, where he says at
p. 331 that:

Damage by injurious affection,
sometimes referred to as consequential damage, may arise in three different
situations, two of which involve the expropriation of a portion of the
claimants land and a third which involves no such expropriation.



[78]      In addition, George Challies in
The Law of
Expropriation
(2d ed.) Wilson and Lafleur, 1963, defines injurious
affection at p. 131 as follows:

Compensation is recoverable not only for the value of land
taken, but for consequential damage to other property. Such consequential
damage is termed injurious affection in England and the common law Provinces of
Canada.

[42]

The trial judge also referred to case authorities.  He stated:

[77]      Mr. Todds definition was adopted by the
Federal Court of Appeal in
Semiahmoo Indian Band v. Canada
, [1997]
F.C.J. No. 842 (C.A.) where the Court dealt with the issue of whether the
surrender to the government of 22.4 acres of the Bands reserve impeded
development on the remainder of the reserve. The Court pointed out, in reliance
on Mr. Todds book, that:

Damage by injurious affection, also
known as consequential damage, recognizes
inter alia
that, [w]here
part of an owners land is expropriated, the piece or pieces of land remaining
may be rendered less valuable as a result of their severance from the expropriated
portion. Here a claim may be made for injurious affection by severance.



[79]      In
Lamb v. Manitoba Hydro-Electric Board
,
[1966] S.C.R. 229 the Supreme Court of Canada dealt with lands and buildings of
the appellant in low lying land expropriated by the Board pursuant to the
Manitoba
Hydro Act,
1961 (Man.), c. 28
.

[80]      The appellant was not satisfied with the amount
offered as compensation and arbitration proceedings followed. The parties
reached an agreement as to the compensation payable for injurious affection but
the arbitrator had to concern himself with fixing compensation for the value of
the lands and buildings expropriated.

[81]      The appellant was not content with the compensation
awarded for the lands and buildings.

[82]      In the Supreme Court of Canada, the judgment of the
majority was written by Hall J. and during the course of his judgment at
p. 233, he said the following:

Meanwhile, as a result of negotiations between the parties,
an agreement had been reached whereby compensation payable under the heading of
injurious affection or consequential damage and the cost of relocating the
sewage disposal field was agreed upon in the sum of $18,000.

[43]

The appellants are critical of the judge for relying on these
authorities because the specific interpretive issues were not before the Court,
but, in my view, they merely are examples of judicial comments that are
consistent with the observations in the texts.  I note also, that in
Antrim
,
Mr. Justice Cromwell referred to the page in Professor Todds text on
which the Province relies, although the specific issue was not then before the
Court.

[44]

In
Rock Resources
, this Court rejected as inadequate a plan of
compensation that would not permit compensation to be paid for damages for  consequential
damages .  In context, the phrase clearly encompassed damages for injurious
affection.

[45]

In summary, there is no conceptual reason to conclude that damages for
injurious affection are not included in consequential damages.  There is no
authority to the contrary.  It would appear that learned authors and the courts
have assumed that such damages are included in consequential damages.  I see no
basis to interpret s. 5(5) in a manner inconsistent with this.

Conclusion

[46]

In my view, the judge correctly concluded that the appellants are not
entitled to a declaration that they are entitled to advance a claim for
injurious affection.

[47]

In such circumstances, I do not think it appropriate to consider whether
the appellants pursuance of the present application was an abuse of process.

[48]

I would dismiss this appeal.

The Honourable Mr. Justice Chiasson

I
agree:

The Honourable Mr. Justice Frankel

I
agree:

The
Honourable Mr. Justice Fitch


