The Alberta Court of Appeal rejected an application for leave to appeal from a decision that found that a gas supply easement continued to apply after a lot was severed into three parts (creating two new lots). The owners of the original parcel applied to the Alberta Utilities Commission for an order directing the Evergreen Gas Co-op to discharge its easement from the newly subdivided lots. The Commission refused, and the owners sought leave to appeal the decision to the Court of Appeal.
The Court of Appeal confirmed that the easement, which was a general easement that applied to the entire original property (rather than a limited easement or ROW over a particular portion of the property), would continue to apply to any subdivided parts of the property. The Court rejected the argument by the owners that the imposition of the easement on the new parcels was nevertheless "improper" within the meaning of the Gas Distribution Act. The Court also rejected the argument that the easement "agreement" (the easement was created when the owners agreed to receive gas service from the Co-op, the terms of the contract being statutorily set) was "unconscionable" - how could the contract be unconscionable when the owners had applied for gas service and the terms of the contract were imposed by statute?
Read the decision at: Andre v Evergreen Gas Co-op Ltd.
Storm
Showing posts with label Alberta Utilities Commission. Show all posts
Showing posts with label Alberta Utilities Commission. Show all posts
Tuesday, June 10, 2014
Tuesday, January 24, 2012
Alberta Court rules in favour of landowner over crossing agreement
In 1948, CPR and Calgary Power Ltd. reached an agreement providing Calgary Power with the right to place three towers carrying power transmission wires on and over CPR property abutting the north side of 10th Avenue S.E. in the City of Calgary. The agreement also provided that either party could terminate the agreement by giving three months' notice, and on termination Calgary Power would be obligated to remove the towers and wires and make good any damage caused to the property. If the removal did not happen within one month of termination, CPR could undertake the work itself at the expense of Calgary Power or take ownership of the towers and wires. Under the agreement, Calgary Power was to pay to CPR an annual rental of $40.00.
Flash forward to more recent times. The power transmission facilities on the property have been expanded. The original agreement and subsequent amending agreements have been assigned by Calgary Power to a company called Enmax. CPR has sold its lands to a development company called Remington. Remington wanted to develop the former CPR lands and advised Enmax of the plans. Enmax told Remington that a 20 metre utility right-of-way would be required and that Remington would need to bear the cost of any changes, including the conversion of the overhead power lines to underground lines.
Remington's response to Enmax was to provide a notice of termination under the existing agreements. Enmax was directed to vacate the Remington lands (the former CPR lands) on or before June 30, 2005. Despite that direction, Enmax has refused to remove the transmission towers and lines from the lands. Remington says that its development will be severely compromised with the continued presence of high voltage transmission lines. It believes such a continued presence will acutely influence potential purchasers or tenants in its intended mixed use residential/commercial development.
Remington applied to the Court of Queen's Bench for orders requiring Enmax to vacate the lands. Enmax argued in response that the agreements between CPR and Calgary Power were personal contracts between a railway company and a utility company and could not be assigned to Remington without the consent of Enmax. There were also questions raised about whether the agreements actually created true rights-of-way or whether the rights granted were simply a personal licence which could not be assigned or transferred.
The Court found that the agreements did create utility rights-of-way, which through legislation were not subject to all of the Common Law rules surrounding valid easements and rights-of-way. Further, the Court ruled that if it was wrong about the nature of the agreements, and they did create mere licences, CPR still had the right to assign the agreements to Remington without the consent of Calgary Power or Enmax.
For those reasons, the Court found that Remington was entitled under the agreements to terminate and require Enmax to remove its facilities. Of course, that dealt only with the private relationship between the parties. The transmission facilities are also subject to public regulation by the Alberta Utilities Commission (AUC). The Court directed Enmax to make an application to the AUC to remove the transmission lines, and ruled that the lines could not be removed or relocated in the absence of an order from the AUC.
This decision is reminiscent of an earlier Alberta Court decision involving a landowner named Randolph Hill. He purchased land from a railway company and was assigned an agreement that gave him the right to require a pipeline company to remove its pipeline. The Court agreed that he had that right, but then the company simply went to the National Energy Board and obtained a Right of Entry Order. The ROE Order now permits the pipeline to remain in place and, further, allows the company to abandon the line in place.
Hill will no doubt be seeking compensation for this expropriation of his rights under the agreement. It will be interesting to see how much those rights are worth. What would someone pay for an agreement that would allow them to free their lands from the encumbrance of a pipeline corridor? That has to be worth a lot on the open market. Remington may very well find itself in a similar position. The AUC may decline to order the removal of the transmission lines, in which case Remington's rights under the CPR agreements will have effectively been expropriated.
Read the decision at: Remington Development Corporation v. Enmax Power Corporation.
Flash forward to more recent times. The power transmission facilities on the property have been expanded. The original agreement and subsequent amending agreements have been assigned by Calgary Power to a company called Enmax. CPR has sold its lands to a development company called Remington. Remington wanted to develop the former CPR lands and advised Enmax of the plans. Enmax told Remington that a 20 metre utility right-of-way would be required and that Remington would need to bear the cost of any changes, including the conversion of the overhead power lines to underground lines.
Remington's response to Enmax was to provide a notice of termination under the existing agreements. Enmax was directed to vacate the Remington lands (the former CPR lands) on or before June 30, 2005. Despite that direction, Enmax has refused to remove the transmission towers and lines from the lands. Remington says that its development will be severely compromised with the continued presence of high voltage transmission lines. It believes such a continued presence will acutely influence potential purchasers or tenants in its intended mixed use residential/commercial development.
Remington applied to the Court of Queen's Bench for orders requiring Enmax to vacate the lands. Enmax argued in response that the agreements between CPR and Calgary Power were personal contracts between a railway company and a utility company and could not be assigned to Remington without the consent of Enmax. There were also questions raised about whether the agreements actually created true rights-of-way or whether the rights granted were simply a personal licence which could not be assigned or transferred.
The Court found that the agreements did create utility rights-of-way, which through legislation were not subject to all of the Common Law rules surrounding valid easements and rights-of-way. Further, the Court ruled that if it was wrong about the nature of the agreements, and they did create mere licences, CPR still had the right to assign the agreements to Remington without the consent of Calgary Power or Enmax.
For those reasons, the Court found that Remington was entitled under the agreements to terminate and require Enmax to remove its facilities. Of course, that dealt only with the private relationship between the parties. The transmission facilities are also subject to public regulation by the Alberta Utilities Commission (AUC). The Court directed Enmax to make an application to the AUC to remove the transmission lines, and ruled that the lines could not be removed or relocated in the absence of an order from the AUC.
This decision is reminiscent of an earlier Alberta Court decision involving a landowner named Randolph Hill. He purchased land from a railway company and was assigned an agreement that gave him the right to require a pipeline company to remove its pipeline. The Court agreed that he had that right, but then the company simply went to the National Energy Board and obtained a Right of Entry Order. The ROE Order now permits the pipeline to remain in place and, further, allows the company to abandon the line in place.
Hill will no doubt be seeking compensation for this expropriation of his rights under the agreement. It will be interesting to see how much those rights are worth. What would someone pay for an agreement that would allow them to free their lands from the encumbrance of a pipeline corridor? That has to be worth a lot on the open market. Remington may very well find itself in a similar position. The AUC may decline to order the removal of the transmission lines, in which case Remington's rights under the CPR agreements will have effectively been expropriated.
Read the decision at: Remington Development Corporation v. Enmax Power Corporation.
Tuesday, September 14, 2010
Alberta Utilities Commission turns down landowner request to review MATL consultation process
The Alberta Utilities Commission (AUC) has denied a request for review by affected landowners of its approval for the construction and operation of an international power line from Alberta to the United States. The power line application was made by Montana Alberta Tie Ltd. (MATL), and on January 31, 2008 the AUC conditionally approved the Power Line.
In April of 2010, a group of landowners acting as "My Landman Group Inc." asked the AUC to review its decision because they alleged that MATL had not complied with the conditions of the original approval related to landowner consultation and negotiation. Landowners asked the AUC to enforce its conditions of approval and, if the AUC declined, stated that they would ask for similar relief from the Surface Rights Board. The landowners submitted that once MATL obtained its licence, it stopped engaging in negotiations and mitigation and cancelled meetings with landowners until survey permission was sought and a final offer was delivered, which, for certain landowners, was over two years later.
The landowners submitted that they have been attempting to discuss and negotiate outstanding matters with MATL, without any success. They believe that MATL does not intend to meet to negotiate, including making any changes to their proposed right-of-way agreements, with first and final offers having been the same, with no unique conditions between the unique needs of individual landowners. They question how these practices can reasonably be characterized as negotiation and mitigation, and believe that the concept of negotiation implies willingness by both parties to compromise. The landowners effectively believe that MATL is not negotiating in good faith or engaging in mitigation.
The AUC rejected the landowners' request for review, first on the basis that the request was out of time and second on the basis that there were no exceptional circumstances warranting a late review. The Commission found that:
... there is nothing before the Commission in this proceeding that demonstrates that the process has not been followed. The Commission finds that Landowner submissions simply indicate that the Landowners are not satisfied with the results of the process and that they have not reached an agreement with MATL. In this latter regard, the Commission notes that Decision 2008-006 specifically contemplated that the Surface Rights Board has the jurisdiction to issue right of entry orders and to address matters involving compensation, such as impacts from final pole locations, where private negotiations between landowners and MATL remain unsuccessful.
Thursday, February 4, 2010
Edmonton Journal: "AltaLink's wallet soothes landowners"
AltaLink's wallet soothes landowners
The Edmonton Journal has reported that landowners along a planned high-voltage direct current line have been "soothed" by talk of increased compensation. The lines will run between 50-metre high towers, and AltaLink, the utility company, is offering to pay an annual fee to landowners of $1,178 for each tower on cultivated land and $471 for each tower on uncultivated land.
There is an additional lump sum to be paid for the 55-metre wide right-of-way (contrast this with the fairly standard 18-20 metre wide easement for oil and gas pipelines) along with a crop loss payment, entry fee payment and a $10,000 bonus for signing the easement.
However, the final route for the line has not yet been decided and an application to the Alberta Utilities Commission won't be made until later in 2010 or early in 2011.
What do you think about the proposed compensation? Although AltaLink's Vice-President is cited in the article as saying that a 240-kV tower would previously have brought only $150 to $200 compensation, for the size of the easement taken and the impact, visual and otherwise, of a major transmission line and towers through a farm, the annual payment seems unremarkable - at least when compared with similar payments for oil and gas wells and other above ground oil and gas facilities.
The Edmonton Journal has reported that landowners along a planned high-voltage direct current line have been "soothed" by talk of increased compensation. The lines will run between 50-metre high towers, and AltaLink, the utility company, is offering to pay an annual fee to landowners of $1,178 for each tower on cultivated land and $471 for each tower on uncultivated land.
There is an additional lump sum to be paid for the 55-metre wide right-of-way (contrast this with the fairly standard 18-20 metre wide easement for oil and gas pipelines) along with a crop loss payment, entry fee payment and a $10,000 bonus for signing the easement.
However, the final route for the line has not yet been decided and an application to the Alberta Utilities Commission won't be made until later in 2010 or early in 2011.
What do you think about the proposed compensation? Although AltaLink's Vice-President is cited in the article as saying that a 240-kV tower would previously have brought only $150 to $200 compensation, for the size of the easement taken and the impact, visual and otherwise, of a major transmission line and towers through a farm, the annual payment seems unremarkable - at least when compared with similar payments for oil and gas wells and other above ground oil and gas facilities.
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