Right to Exclude: State Expropriation and Regulation

The court of appeal concluded that while the legislation did put the appellant out of business, there had been no deprivation of property of the appellant by the respondent.

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  M.F’s suppliers and customers whom it had acquired and cultivated over the years constituted one of its most valuable assets.
  
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  Thinks this asset should be understood as goodwill, frames goodwill in the following way:
  

1. 
   Ritchie: Goodwill lost best described by Lord Macnaghten in Trego v. Hunt says: “it happens that the goodwill is the very sap and life of the business, without which the business would yield little or no fruit.”
   
2. 
   Trial Judge: (Contrast with goodwill as connection of customers) Ulster Transport Authority v. James Brown & Sons (which cites Lord Macdermott’s reasoning in Inland Revenue Commissioners v. Muller & Co. Margarine Ltd and holds that Goodwill is lost, but that goodwill is not property which can be compensated for expropriation.
   
3. 
   (Parallel) Inland Revenue Commissioners v. Muller & Co. Margarine Ltd: Goodwill is something generated by the effort that adds to the value of the business. When the make-up of a well established profitable enterprise providing a special service is examined I think it well neigh impossible to disentangle the business that has been built up from its goodwill or to give the latter a single or precise meaning. (RITCHIE USING MULLER TO APPROACH QUESTION OF GOODWILL IN COMMERCIAL SENSE)
   

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  Lower courts weren’t willing to equate the appellant’s loss of business and the creation of the legislation as the acquiring of the business by the corporation.
  
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  Long Established Rule for Payment of Compensation by Crown: Attorney General v. De Keyser’s Royal Hotel: The recognized rule for the construction of statutes is not to be construed so as to take away the property of a subject without compensation.
  
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  Argument against this compensation is Ulster Transport [238], but Ritchis finds this is support for the Appellant pos’n.
  
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  Respondents/CoA rely on France Fenwick v. The King: A negative prohibition, though it involves interference with an owner’s enjoyment of property does not merely because it is obeyed carry with it in common law any right to compensation.: Can’t equate circumstances of that case with this situation, here there is a creation by Parliament of a Government Corporation with the express purpose of monopolizing the whole business of the appellant through the negative prohibitions.
  
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  Respondents/CoA rely on Malaysia v Selangor Pilot (Contrast) Difference between the deprivation placed on the pilots by legislation at issue in that case and the obliteration of the appellant’s entire business.
  
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  Also points out Federal minister’s letter to the company acknowledging the assets of the appellant could be valued on the basis of an ongoing business.
  

1. 
   Is there property?
   
2. 
   Is there compensation required according to a statute?
   
3. 
   What has been taken? Tener
   
4. 
   What did the government get? Tener
   

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  Expropriation occurs if the Crown acquires from the owner an interest in property – mining rights are considered an interest in property – We must ask: 1) What right was lost and what interest was acquired by the government? and 2)When did the compulsory taking occur?
  
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  Attorney General v. De Keyser’s Royal Hotel: There is a presumption in favour of a right to compensation, unless a statute clearly says the opposite
  
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  The effect of zoning or regulation of specific activity on certain land on property need not be compensated for since they are not used to increase property value. (Note: doubtful statement) Here, the province was increasing the value of the park at the mining company’s expense – Therefore this is an expropriation.
  
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  Estey Cites: Manitoba as consistent with his position that where property rights are expropriated compensation must flow.
  
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  Distinguishes from zoning the broad legislation of land in the community: Bridgeman v. Toronto [246]
  
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  In terms of valuation – There should be compensation for the value of the loss of access; total value of the minerals less the future possibility of the prohibition on mining being lifted.
  

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  R. v. Morgantaler: Exclusion of property rights from s.7 of the Charter.
  
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  In contrast, Irwin Toy v. Quebec left open the question of the extent to which economic rights may be protected: Economic rights as generally encompassed by the term property are not within perimeters of s.7 but this does not mean that no right with an economic component can fall within Security of the Person.
  
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  Disagrees with Counsel’s claim that this is a violation of s.7 because there is a violation of the right to earn a livelihood. Instead, draws parallel with R v. Edwards: Legislative choices regarding alternative forms of business regulation do not generally impinge on the values and provisions of the Charter.
  
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  The Haddocks have not been deprived of the means of extending their livelihood into retirement; their complaint is as I have already said, that this investment is not as lucrative as they would like, and they attribute this to the impugned legislation.
  
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  Applicants are at liberty to place assets in other income earning investment
  
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  The issue is not that the impugned legislation has deprived the Haddocks of a means of livelihood necessary to their survival; obviously it hasn’t.
  

-Claim that the legislation constitutes a statutory taking of their property, that under the common law principles of statutory interpretation, compensation is required (cf. De Keyers, Manitoba).

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  The right to receive increased rents constitutes property rights.
  
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  Leading Cdn Case on presumption of “no taking without compensation” is Manitoba Fisheries. For Manitoba to apply, the Act must create an expropriation of property from the Plaintiff to the state for use or destruction. DISTINGUISHED HERE.
  
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  The Act in this case is not an expropriation by the Crown but is an exercise of its regulatory authority – there is no rule or policy basis for presuming that those adversely affected by a statute regulating their affairs are entitled to compensation unless the statute says otherwise as in the exceptional case of expropriation.
  
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  If regulatory legislation voiding but not expropriating property rights triggered a presumed right to compensation from the state, the effect would be to give property rights the equivalent of the protection accorded by s. 7 of the Charter despite clear exclusion of such rights.
  
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  Economic rights such as the right to own property and the right to carry on a business or earn a particular livelihood fall outside the scope of the s. 7 Charter guarantees
  
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  For the presumption of compensation to apply, the legislation must create an expropriation of the plaintiff’s property by the state  Although the orders allowing rent increases may have been taken away from the plaintiff, they cannot be said to have been acquired by the Crown, nor transferred to the tenants.
  

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  CPR argues that at CML a government act that deprives a landowner of all reasonable use of its land constitutes a de facto taking and imposes an obligation on the government to compensate the landowner.
  

-CPR does not demonstrate that the City had acquired a beneficial interest in the land. Don’t need to establish a forced transfer of property; beneficial interest will suffice– Manitoba Fisheries loss of goodwill had to be compensated, Tener mining rights were acquired through the appropriation of the Park by the Crown. Here Crown’s actions have not acquired a beneficial interest through their legislation.

-Requirement must be assessed not only in relation to the land’s potential highest and best use but having regard to the nature of the land and the range of reasonable uses to which it has actually been put: By-laws do not prevent CPR from using its land to operate a railway: doesn’t prevent maintenance, doesn’t prevent CPR from leasing land in conformity with by-law.

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  Definition of Expropriation in the British Columbia Expropriation Act: The taking of land by an expropriating authority under an enactment without the consent of the owner. An expropriating authority is a person empowered under an enactment to expropriate land
  
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  Even if the facts could be seen to support de facto taking at common law, inference has been conclusively negated by Vancouver Charter: The Province has the power to alter the common law: Here by providing that the effects of the ODP By-law cannot amount to a taking it has rendered inapplicable the common law de facto taking remedy upon which CPR relies.
  

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  Charter Rights Violated and not saved under s. 1. Fails MI = Invalid
  
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  Intra virus City = Valid
  
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  Vague = Invalid
  

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  Height restriction would devastate naturalized gardens. Bell’s garden is distinguishable from the uncontrolled weed patch b/c 95% of plants had been deliberately planted.
  

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  Ramsden v. City of Peterborough held that “avoidance of aesthetic blight” was constitutional and considered PSO.
  
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  Anti weed law having an incidental effect of enforcing aesthetic standards which accord with conventional landscaping tastes is no reason to regard it as exceeding the city’s powers.
  
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  City Act permits to fix standards of fitness for human habitation to which all dwellings must conform.
  
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  By-laws prohibition on “excessive weeds and grass” is a valid public health concern to minimize the risks from poisonous plants, fire, and foreign plant invasion.
  
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  Therefore by-law is Intra vires
  

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  “excessive” in the phrase excessive growths of weeds and grass is completely subjective and essentially arbitrary.
  
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  S. 7 of the by-law is void for vagueness and is invalid and unenforceable
  
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  Bell’s expressive activity warrants constitutional protections: Oakes test: impugned section of by-law fails to restrict expression as little as reasonably possible.
  

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  This is an example of the city regulating common property. It is as if the city of Montreal has privatized common property.
  
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  The city is behaving as if common property is private
  

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  Home Orderly Services Ltd v Government of Manitoba:
  
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    Manitoba sets up a service for the partially disabled, in direct competition with HOS.
    
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    HOS was 100% subsidized the State.
    
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    Court holds that the Province did not expropriate property.
    
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  Keystone Bingo Center v Manitoba Lotteries Foundation et al:
  
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    KBC operated a bingo business
    
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    Province adopted a new regulation requiring it to have a license.
    
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    KBC goes bankrupt.
    
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    Court holds that KBC was operating at the sufferance of the government.
    
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  Harvard Investment Ltd. v. City of Winnipeg.
  
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    Owner wants to tear down this historic building.
    
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    City adopts a zoning law preventing its destruction.
    
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    Lower courts hold that the zoning by-law did not curtail the use of lands.
    
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    Court of appeal held that there was a taking away, but the City ACQUIRED NOTHING, nothing was added to the value of public property. Judge relied on Tener for the proposition that to constitute a taking, expropriation must add to the value to public property.
    
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    Twaddle J., concurring, suggests that the two elements are: (a) acquisition of an asset, and (b) the complete extinguishment of an asset’s value to the owner (i.e. rendering property virtually useless)
    
  • 
    Rule – To be compensable, expropriation must have two elements: taking and getting (i.e. addition in value to the public property).
    

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  Twaddle’s statement in Harvard as to the second element of expropriation was refuted by Cromwell J. in Attorney-General of Nova Scotia v. Mariner Real Estate Limited et al. (1999) (N.S.C.A.).
  

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  Milk quotas are a property right, created by the State, and protected by the State. It is a completely artificial system where ownership is concentrated in a small number of dairy producers.