No Free Ride on Expropriation Costs

AS PREVIOUSLY PUBLISHED IN THE RURAL VOICE:

In the oft-cited case of Toronto Area Transit Operating Authority v. Dell Holdings Ltd. from 1997, Justice Cory of the Supreme Court of Canada wrote of expropriation:

The expropriation of property is one of the ultimate exercises of governmental authority.  To take all or part of a person’s property constitutes a severe loss and a very significant interference with a citizen’s private property rights.  It follows that the power of an expropriating authority should be strictly construed in favour of those whose rights have been affected.  This principle has been stressed by eminent writers and emphasized in decisions of this Court.

The presumption is that there will be no expropriation without compensation, and expropriation statues such as Ontario’s Expropriations Act are to be read, as noted by Justice Cory, “in a broad and purposive manner in order to comply with the aim of the Act to fully compensate a land owner whose property has been taken.”

Full compensation is normally understood to include reimbursement of the reasonable costs incurred by a landowner incurred in the determination of the amount owing for the expropriation.  The landowner will not be “made whole” if he or she is left out of pocket for legal, appraisal and other costs expended in disputing the amount of compensation offered by an expropriating authority.  Section 32 of the Expropriations Act requires the Local Planning Appeal Tribunal (the statutory tribunal that arbitrates expropriation compensation, formerly the Ontario Municipal Board or “OMB”) to order payment of a landowner’s reasonable legal, appraisal and costs “actually incurred by the owner for the purposes of determining the compensation payable” where the compensation amount recovered by the landowner is “85 per cent, or more, of the amount offered by the statutory authority”.  If the amount recovered is less than 85 percent of what was offered in compensation by the authority, the Tribunal has discretion to award costs as it sees fit.

The 85 percent rule, which is a common one across Canadian jurisdictions, means that the landowner does not need to accept the compensation offered by the authority solely out of fear of the costs of arbitrating the compensation.  The landowner will still be entitled to recover his or her reasonable costs even if the Tribunal determines that the compensation payable is up to 15 percent less than what was offered by the expropriating authority.  Only where a landowner turns down an offer by the expropriating authority that ends up to be more than 15 percent higher than the actual compensation payable (as found by the Tribunal) does the landowner risk not recovering his or her own costs and perhaps having to pay costs to the expropriating authority.

Where land is taken by an expropriating authority, Section 25 the Expropriations Act requires that the expropriating authority serve on the registered owner of the land “an offer of an amount in full compensation for the registered owner’s interest”.  In a recent decision, the Court of Appeal for Ontario confirmed that this mandatory offer is not the only offer that may be relevant to the determination of costs under Section 32 of the Act.  It is open to the expropriating authority to make subsequent offers to settle the issue of compensation, and a landowner will have to consider those offers reasonably on an ongoing basis.   The landowner cannot sit back and reject an updated offer that ends up being more than 15 percent higher than the actual compensation awarded on the assumption that his or her entitlement to costs is safe because the initial offer was too low.  At least not without putting that entitlement to costs at risk.

Writing for the Court of Appeal, Justice Hourigan explained that, “the objective of full and fair compensation cannot be divorced from the objective of the efficient resolution of claims.”  He rejected the landowner’s position in the case on appeal that only the Section 25 offer counted.  In Justice Hourigan’s view, the landowner’s proposed interpretation:

… would permit the prospect of an unreasonable claimant delaying proceedings, running up legal costs, and wasting the [former] OMB’s resources, all the while safe in the knowledge that unreasonable refusals of subsequent offers cannot adversely affect its entitlement to legal costs.

Put another way, “the statutory protection provided by the Act is not a blank cheque that permits a claimant to act unreasonably.”

And it must be remembered that unreasonable conduct by a landowner does not only put the landowner’s entitlement to costs at risk, but also exposes the landowner to possible liability to the expropriating authority for its costs.  In the case before the Court of Appeal, the landowner was appealing a decision by the OMB (upheld on appeal by the Divisional Court) that awarded the expropriating authority its partial indemnity costs incurred after the date of its offer to the landowner that ended up being far more than 15 percent higher than the expropriation compensation awarded.

Landowners facing expropriation can take comfort in knowing that the costs recovery rules are designed to afford them a fair chance to dispute the compensation amount offered by the expropriating authority.  However, the trade-off is that landowners must conduct themselves reasonably throughout the full course of the dispute.

Read the Court of Appeal's decision at:  2020 ONCA 490.

Farm Fields and Reasonable Expectations of Privacy

AS PREVIOUSLY PUBLISHED IN THE RURAL VOICE:

Section 8 of the Canadian Charter of Rights and Freedoms guarantees the right to be secure from unreasonable search and seizure by government authorities, including the police.  The protection applies to people, which includes corporations (as legal persons), not to places.  However, the location in which a search takes place can be important in determining whether the government action was lawful or not.  A search has been defined by the Courts as any state activity that interferes with a “reasonable expectation of privacy”.   An unlawful search is one that unreasonably interferes with a person’s reasonable expectation of privacy. 

A search of a person’s body raises obvious privacy concerns (“personal privacy”) and attracts the highest level of protection under Section 8.  Searches of geographic locations connected to a person may also raise privacy concerns (“territorial privacy” or “spatial privacy”), but not all locations will attract the same level of protection.  Individuals have a high (and most often reasonable) expectation of privacy in places like the home, meaning that the standard of reasonableness required of a search there will be high.  The expectation of privacy in a publicly-accessible commercial space will be comparatively much lower, meaning that the standard of reasonableness required of a search of that location will be comparatively lower than for a search of a private home.

Does a farmer or a farm corporation have any reasonable expectation of privacy on open farmland?  Can a police search of a private field violate a person’s Section 8 Charter right by unreasonably interfering with an expectation of privacy?  The Court of Appeal for Ontario recently heard the challenge of convictions related to production and possession of marijuana by a vegetable farmer, the Appellant, who argued that a police search of the farmland he rented infringed Section 8 of the Charter.  The Trial Judge agreed that Section 8 had been infringed, but ruled that the infringement did not warrant exclusion of evidence subsequently obtained on the farm.  That evidence led to the convictions.

The Appellant leased approximately 12 acres out of a 330-acre property based on a verbal agreement.  A neighbour made a complaint to the police about marijuana being grown on the property and then accompanied a drug investigator to the site: “Both men briefly and unintentionally trespassed on the leased lands, although no marijuana was seen.”  At a later time, an off-duty police officer was hunting on the property with the landowner’s permission and saw some marijuana plants.  He passed that information onto drug enforcement.  Another officer then attended at the property and saw 14 rows of marijuana plants.  As with the visit of the original drug investigator, this officer too unknowingly trespassed onto the leased lands in making his observation.

Eventually the police obtained search warrants, carried out a search of the property, and discovered a large number of marijuana plants in the field, a processing operation in a barn, and other related evidence of drug offences.  At trial, the Appellant applied under Section 8 of the Charter to exclude the evidence obtained under warrant because, in part, the warrants were based on information obtained through a trespass onto the leased land.  The Trial Judge agreed that the police entries onto the leased land prior to the issuance of the warrants did breach the Appellant’s Charter right to be free from unreasonable search and seizure, but concluded the breach was in the “middle range of gravity” and not sufficiently serious to require the exclusion of the evidence later gathered.  This finding was the focus of the appeal, and the Court of Appeal agreed with the Trial Judge and upheld the convictions.

The Court of Appeal also noted that the Trial Judge’s assessment of the Appellant’s privacy interest in the rented field as not measuring “high on the privacy scale” was well-supported by the factual record.  The Appellant had a privacy interest that was more than “trifling” – he had made real and extensive use of the property over a number of years to farm vegetables, and the leased land was hidden from public view due to its precise location – but the fact that the leased area was accessible to persons visiting the overall farm property (the non-leased portion) and the fact that there were no signs or barriers erected to alert a visitor to the Appellant’s assertion of a privacy interest did not lend themselves to a high level of privacy protection from a police search.  Under different circumstances, it would appear, a person’s privacy interest in farmland might warrant a higher level of protection.

It is important to note that not all government searches involve the police and criminal investigations.  Regulatory inspections carried out by government agencies such as the Canada Revenue Agency or the Ontario Ministry of the Environment are also “searches” that must be conducted reasonably and in compliance with Section 8 of the Charter.  While the bar for reasonableness of a regulatory inspection may be set lower than that for a criminal investigation, the inspection may still unreasonably interfere with a person’s reasonable expectation of privacy, including on farm properties.  Whether an inspection has breached the Section 8 Charter right of an individual or a corporation will depend on the circumstances of each particular case.

Read the decision at: Ontario Court of Appeal.

Normal Farm Practices Protection Board goes to the dogs

AS PREVIOUSLY PUBLISHED IN THE RURAL VOICE:

In 1987, the Ontario Government introduced Bill 83, An Act respecting the Protection of Farm Practices, which led to the enactment of Ontario’s first “right to farm” legislation, the Farm Practices Protection Act, 1988.  The Minister of Agriculture at the time, the Honourable Jack Riddell, explained to the Legislature:

Ontario farmers have been concerned for some years that normal farming practices may increasingly result in complaints and court actions under the common law of nuisance. Under the act, a Farm Practices Protection Board will be established. Individuals who complain about odours, noise and dust from farm practices may ask the board to investigate. The board will hold hearings on odour, noise or dust complaints referred to it. The board will have the power to dismiss complaints about a normal farming practice or to issue an order to rectify the problem if it is not normal. […]

The act will deal with current and future nuisance incidents arising from existing conditions. The long-term solution is a strong agricultural planning policy to avoid incompatible and competing uses in agricultural areas.

A decade later, perceived shortcomings in the original legislation were addressed in a new Farming and Food Production Protection Act, 1998 (“FFPPA”), which expanded nuisance liability protection to a number of modern farming activities, added to the list of disturbances covered by the protection, and addressed conflicts between agriculture and restrictive municipal by-laws.  This legislation remains in effect today.

The FFPPA protects “normal farm practices”, which are defined as practices either “conducted in a manner consistent with proper and acceptable customs and standards as established and followed by similar agricultural operations under similar circumstances” or which “[make] use of innovative technology in a manner consistent with proper advanced farm management practices”.  Importantly when it comes to livestock operations, a practice that is inconsistent with the regulations made under the Nutrient Management Act, 2002 will not be considered a normal farm practice.

The first layer of protection for agriculture created by the FFPPA is the nuisance liability protection introduced in the original Farm Practices Protection Act, 1988.  At Common Law (“judge-made” law as opposed to statutory law passed by the Legislature), a person can be liable for use of his or her land in a way that substantially and unreasonably interferes with a neighbour’s enjoyment of his or her own property.  The FFPPA creates an exception by stating that a farmer will not be liable in nuisance for “a disturbance resulting from an agricultural operation carried on as a normal farm practice”.  The agricultural operation must be carried on “in the expectation of gain or reward” to be protected.  The disturbances covered by the FFPPA are odour, dust, flies, light, smoke, noise, and vibration.

The second layer of protection for agriculture in the FFPPA is the resolution of conflicts between normal farm practices and municipal by-laws in favour of normal farm practices.  According to the legislation, no municipal by-law can apply “to restrict a normal farm practice that is carried on as part of an agricultural operation.” 

The FFPPA creates the Normal Farm Practices Protection Board, which is a tribunal with the power “to inquire into and resolve a dispute respecting an agricultural operation and to determine what constitutes a normal farm practice” and “to make the necessary inquiries and orders to ensure compliance with its decisions.”  A person directly affected by a disturbance from an agricultural operation can apply to the Board for a determination “as to whether the disturbance results from a normal farm practice.”  Farmers directly affected by a municipal by-law or “persons who want to engage in a normal farm practice as part of an agricultural operation on land in the municipality and have demonstrable plans for it” can apply to the Board for a determination “as to whether a practice is a normal farm practice for purposes of the non-application of a municipal by-law.”

At issue in one of the most recent cases decided by the Board was a complaint about a surprising source of disturbance – a barking dog acquired by a small farm operation to guard poultry from predators, namely coyotes.  The Applicant lived next door to the farm and alleged that he could hear the dog barking every night and sometimes during the day, and that the barking kept him and his family up during the night and terrified his young son.  The Applicant asked the Board to determine whether the alleged disturbance resulted from a normal farm practice.

The Board dismissed the application without having to determine whether having the guard dog on the farm was a normal farm practice entitled to the liability protection under the FFPPA.  Based on the evidence it heard, and taking into account all of the circumstances, the Board found that the Applicant failed to meet the threshold test – establishing that he was directly affected by the alleged disturbance.  To pass that test, the Applicant would have to have shown that the dog barking caused interference that was “substantial and would not be tolerated by the ordinary occupier in their location, an objective test.”

Read the decision at: Normal Farm Practices Protection Board.

Glyphosate Battles Continue

AS PREVIOUSLY PUBLISHED IN THE RURAL VOICE:

Following the lead of their American counterparts, Canadian class-action lawyers have been busy commencing lawsuits in Canada against Monsanto and Bayer over allegations that glyphosate (the active ingredient in the herbicide Roundup) has caused cancer in individuals exposed to the chemical.  A quick Google search brings up references to at least seven different actions commenced across Canada in 2019 by various representative plaintiffs on behalf of proposed classes of people exposed to glyphosate.  Damages claimed are in the hundreds of millions of dollars, and include “exemplary, punitive, and aggravated damages” intended to address the Defendants’ alleged callous and reckless disregard for the health and safety of users of glyphosate.

On another front, objections have been raised against the continued registration of glyphosate for use in Canada.  In April, 2017, the Pest Management Regulatory Agency (“PMRA”) of Health Canada released a Re-evaluation Decision by which it granted continued registration of products containing glyphosate for sale and use in Canada.  Health Canada evaluated available scientific information and found that:

… products containing glyphosate do not present risks of concern to human health or the environment when used according to the revised label directions.  As a requirement for the continued registration of glyphosate uses, new risk reduction measures are required for the end-use products registered in Canada.  No additional data are being requested at this time.

Health Canada summarized its overall findings from the re-examination of glyphosate as follows:

• Glyphosate is not genotoxic and is unlikely to pose a human cancer risk.
• Dietary (food and drinking water) exposure associated with the use of glyphosate is not expected to pose a risk of concern to human health.
• Occupational and residential risks associated with the use of glyphosate are not of concern, provided that updated label instructions are followed
• The environmental assessment concluded that spray buffer zones are necessary to mitigate potential risks to non-target species (for example, vegetation near treated areas, aquatic invertebrates and fish) from spray drift.
• When used according to revised label directions, glyphosate products are not expected to pose risks of concern to the environment.
• All registered glyphosate uses have value for weed control in agriculture and non-agricultural land management.

A number of Notices of Objection were filed pursuant to the federal Pest Control Products Act requesting that a review panel of scientists be established to review Health Canada’s decision to continue glyphosate’s registration.  The PMRA of Health Canada decided not to establish a review panel on the basis that the “objections raised did not create doubt or concern regarding the scientific basis for the 2017 re-evaluation decision for glyphosate.” 

In January, 2020, the Federal Court of Canada heard an application for judicial review of the PMRA’s decision not to establish a review panel.  The Applicants were Safe Food Matters, a non-profit corporation dedicated to the safety of food production technologies, and its President.  They requested an order “quashing” or voiding the decision and directing the PMRA to establish a review panel.  The Applicants’ Notice of Objection raised concerns about using glyphosate as a pre-harvest dessicant for crops, rather than as a weed killer, and focused on harm to humans rather than harm to the environment.  The PMRA found that the objection did not raise “scientifically founded doubt” about the validity of Health Canada’s Re-evaluation Decision on glyphosate, and that expert scientists would not be able to assist in addressing the topics raised in the objection.

In a decision dated February 13, 2020, Madam Justice Simpson dismissed the application for judicial review on the basis that the Applicants failed to show in their Notice of Objection that “there exists scientifically founded doubt” about the validity of Health Canada’s Re-evaluation Decision on glyphosate.  She applied the standard of review of “reasonableness”, meaning that the PMRA’s decision would stand as long as it was both logical and rational, and fell within relevant factual and legal constraints (such as rules imposed by the law governing the PMRA, principles of statutory interpretation, past practices and decisions, etc.).  Justice Simpson’s view was that the decision would only be unreasonable if the Applicants’ Notice of Objection showed a “well founded scientific doubt about a conclusion” in Health Canada’s Re-evaluation Decision, and that “scientifically founded doubt … must be demonstrated by at least one controlled peer reviewed study published in a reputable journal that contradicts or raises a reasonable doubt about the Evaluations’ conclusions.”  She concluded the Applicants failed to show that the PMRA’s decision was unreasonable based upon those criteria.

Following the release of the Federal Court decision, Safe Food Matters announced on its website that it would review its next steps with counsel and its board, which could include a possible appeal, a further judicial review application, and pushing for changes to the law.

Read the Federal Court decision at:  M. v. Canada (Attorney General).