Is a 1960 reservation of the right to take hay still enforceable?

The Nova Scotia Supreme Court has recently heard the case of a farmer looking to exercise a right to take hay that was first created in 1960.  The Court explained:

This application involves the interpretation of a reservation of a hay/crop

right in favour of GC, his heirs and assigns” in a 1960 deed from

GC to the respondents’ predecessor in title ID. An area of some 2.7 acres of GC’s 150-acre farm lot in Antigonish County, was conveyed, along with a 100-year old farm house and barn (or its foundation), collectively “the S lot.” After describing the dimensions of the 2.7-acre lot, which runs through GC’s farm lot, the deed then provides the following:

RESERVING however to the said GC, his heirs and assigns the right and privilege to enter upon the said land from time to time for the purpose of removing hay or other crops or improving the land, ...

GC's nephew and successor in title has now come to the Court seeking an order confirming and declaring his right to enter the 2.7 acre parcel "for the purpose of removing hay or other crops or improving the land".

The Court determined that the right reserved to GC when he sold the 2.7 acre parcel was a "profit a prendre" - a right to take the produce or profit from the land.  The Court ruled that GC had reserved to himself and to his assigns (his successors in title) the right to remove hay form a portion of the 2.7 acres and that this reservation was not "repugnant" to the grant of title to the 2.7 acres (i.e. the sale of the land in 1960).

The responding parties (the current owners of the 2.7 acres) argued that the profit a prendre was extinguished years ago "because the purpose for which the condition was created has now expired".  The Court disagreed with this position.  It found that the owners of the GC lands have continued to take hay from the 2.7 acres since 1960 (whether for their own use or by lease to another farmer) and that:

If the profit appurtenant has been extinguished by the permanent alteration of the GC tenement, since it is no longer a cattle farm, then removal of the hay is still held as a right in gross, unaffected by such circumstances. It is a right exercisable by GC, the owner of it independently of his ownership of any land. The reservation is not rendered void or the profit extinguished due to alteration to the GC lot. 

However, the Court agreed with the respondents that the right to take hay on the whole 2.7 acres unreasonably limited their potential use of the property.  The Court made an order allowing the respondents to use the land within a certain tree line, which the Court determined "would not be an actionable infringement of the reservation rights".  The Court did grant the application and declared that the GC land owners hold a profit a prendre.

Read the decision at: Chisholm v. Snyder.

B.C. Court rules Ghost Town Resort must allow mining exploration

Kitsault, British Columbia, is located near the head of Alice Arm in the northwest corner of British Columbia, about 140 kilometres north of Prince Rupert. It is the site of a former molybdenum mine, known as the Kitsault Mine. Open pit mining began at this site in 1968. Mining operations were suspended in August 1972 due to low molybdenum prices, resumed in April 1981 and were suspended again in November 1982 due to low molybdenum prices.

In 1980, a townsite (“Kitsault Townsite”) was constructed to provide accommodation for those who worked at the Kitsault Mine. The Kitsault Townsite was comprised of approximately 100 houses, seven apartment buildings, a hospital, a school, stores, restaurants, a theatre, a library, a pub, recreation centres and other buildings and utilities to support a population of over 1,200 people.

When the Kitsault Mine shut down in 1982, all of the residents of the town left, leaving it a modern-day ghost town. However, unlike other ghost towns in British Columbia, Kitsault was not left to deteriorate and fall to ruin. The owners of the Kitsault Mine continued to provide heat for the buildings to prevent mould and mildew setting in and hired full-time caretakers to maintain and protect the buildings and maintain the lawns, grounds and roadways.

In 2005, the defendant, Kitsault Resort Ltd. (“Kitsault Resort”) purchased Kitsault Townsite from Aluminerie Lauralco, Inc. (“ALI”), the company that then owned both the mineral properties comprising the former Kitsault Mine and the lands and improvements comprising Kitsault Townsite. At the time it sold Kitsault Townsite, ALI was engaged in the remediation, reclamation and decommissioning of the Kitsault Mine as required by law.

Prior to conveying Kitsault Townsite to Kitsault Resort, and in accordance with the agreement of purchase and sale, ALI granted to itself and to Climax Canada Ltd. (“Climax”) a statutory right of way (the “Right of Way”) across the Kitsault Townsite.  In 2008, ALI sold its mineral tenures and other lands located at Kitsault, including the Right of Way, (collectively referred to as the “Kitsault Property) to Avanti Kitsault Mine Ltd. (“AKM”), a subsidiary of Avanti Mining Inc. (“Avanti”).  Avanti and AKM are currently carrying out exploration activities to support an application to reactivate the Kitsault Mine. AKM, as the registered owner of the Right of Way, claims the right to use the Right of Way, now and in the future for its exploration activities and for its mining activities in the event it re-opens the Kitsault Mine. Kitsault Resort has refused to permit Avanti to cross over Kitsault Resort pursuant to the Right of Way.

AKM and Kitsault Resort went to court to determine the scope and validity of the Right-of-way.  Kitsault Resort argued that, even if the Right-of-way remained in place, it was limited to remediation and decommissioning activities.  The Resort argued that mining activities were not permitted.  The court found that there were three issues to be resolved in the proceeding:

(a) On the proper construction of the Right of Way, are the rights granted by it limited to activities for the remediation, reclamation and decommissioning activities required at the Kitsault Mine only, or do they include the right to use the Right of Way for the purpose of exploration and mining activities? A further matter for consideration under this issue is whether the rights granted by the Right of Way are limited to activities carried out at the actual Kitsault Mine site, or whether they apply to any lands, improvements or works intended to be used in conjunction with the mine site, including the surrounding mineral deposits?

(b) If the rights are not limited to remediation, reclamation and decommissioning, should the Right of Way be rectified to so limit its scope?

(c) Is the defendant entitled to cancellation or modification of the Right of Way under s. 35 of the Property Law Act?

The court found in favour of AKM on all issues and made a declaration that AKM is entited to use the Right-of-way for exploration activities.  The court also found that AKM was entitled to an injunction preventing the Resort from obstructing use of the Right-of-way to carry out mining activities.

Read the decision at: Avanti Mining Inc. v. Kitsault Resort Ltd.