June 15, 1995, E.C.B. No. 50/92/90
(56 L.C.R. 131)
Cejka and Margaret Cejka
M. St. Clair, Vice Chair
Frame for the Claimants
Guy E. McDannold for the Respondent
1. THE APPLICATION
This application came on for hearing on March 29, 1995. The claimants, Bohumil
Cejka and Margareta Cejka ("the Cejkas") filed a Notice of Motion seeking an order
"summarily determining paragraph 1 (b) of the amended application for determination
of compensation." Paragraph 1 (b) seeks:
determination as to whether the Expropriation Compensation Board has jurisdiction
to determine the compensation payable to the claimants resulting from a 1991 apparent
expropriation of a statutory right-of-way."
Paragraph B of the Cejkas' Statement of Claim provides more detail as to why they
have raised the issue of jurisdiction. It states:
"The claimants require a determination as to whether the Expropriation Compensation
Board has jurisdiction to determine the compensation for the purported expropriation
in 1991 of a statutory right-of-way. The claimants suggest that the Expropriation
Compensation Board may not have jurisdiction to adjudicate compensation because:
1. The vesting notice filed at the Prince George Land Title Office on May 29,
1991 is void and is a nullity because the respondent failed to comply with s.
19 of the Expropriation Act and compliance with s. 19 is a statutory prerequisite
to the filing of the vesting notice."
19 requires an expropriating authority, among other things, to make an advance
payment to an owner in the amount it estimates is payable, other than for business
Paragraph B goes on to allege five ways in which
the respondent, the Cariboo Regional District ("Cariboo") failed to comply with
s. 19. Counsel for the Cejkas only relied on two of these at the application.
These were that Cariboo "failed to make any form of payment to the claimant, Margareta
Cejka" and that it "failed to pay to the claimant, Bohumil Cejka, the amount of
its estimate as required by s. 19 (1) (d)".
of Claim also alleges that the Expropriation Compensation Board ("the board")
may not have jurisdiction to adjudicate compensation in this case because "the
statutory right-of-way which the respondent purported to expropriate appears uncertain
…". Counsel for the Cejkas, however, did not rely on this allegation at the hearing,
and I accordingly have not considered it here.
THE CLAIMANTS' POSITION
Mr. Frame, counsel for the
Cejkas, made the unusual assertion that the Cejkas were not taking a position
on their own application. He stated that they were not asking me to determine
that there had not been an expropriation, and when I questioned him about this,
he also stated that they were not asking me to find that there had been an expropriation.
Mr. Frame's written argument sets out the Cejkas' position (or purported lack
of a position) as follows:
do not take a position on this application. The claimants are concerned that the
Board may decline jurisdiction in this case because of the respondent's failure
to comply with the statutory prerequisites. If this Board eventually declines
jurisdiction, the claimant's [sic] claim for compensation arising from the expropriation
cannot proceed and the claimants will not be able to recover costs under s. 44.
Therefore, the claimants ask that this Board's jurisdiction be determined before
the claimants incur the considerable expenses of preparing for the hearing presently
set for August 28, 1995."
Mr. Frame based
his argument regarding Cariboo's failure to make the required payments under ss.
19 (1) (d) of the Expropriation Act, S.B.C. 1987, c. 23 ("the Act") on
the reasons of the Court of Appeal in Cariboo's appeal from an earlier interlocutory
decision of the board (reported as Cejka v. Cariboo Regional District (1994), 53 L.C.R. 85). Cariboo had brought an application before the board to
determine whether or not the Cejkas' claim was statute-barred under s. 24 of the
Act. Section 24 provides:
"Where no application
is made to the board to determine compensation within one year after payment is
made under section 19, the owner whose land was expropriated shall be deemed to
have accepted the sum paid in full settlement of his claim for compensation, and
no proceedings to determine compensation shall be brought by that owner."
Although Cariboo had tendered a cheque to Mr. Cejka in the sum of $100 on May
16, 1991, and at the same time had served Mrs. Cejka with a letter indicating
that the cheque delivered to her husband was made payable jointly to both of them,
the Cejkas never negotiated the cheque. Instead they returned it to Cariboo some
time after the vesting notice was filed at the Land Title Office. The Cejkas commenced
this expropriation action over a year after Cariboo tendered the $100 cheque.
The majority of the board decided that there had to be
a reasonable period of time elapse before the limitation period set out in s.
24 would begin to run, after the tender of a cheque under s. 19, in order to enable
the owner to negotiate the cheque. On the basis that the year stipulated in s.
24 ran from the end of this reasonable period of time rather than from the date
of tender, and that it was still running when the compensation claim was commenced,
the majority ruled that the claim was not out of time.
The Court of Appeal also found that the claim was not out of time, but for different
reasons. Hinkson, J.A., at p. 87 of his reasons, held that:
"… the tendering of the cheque did not constitute payment until the cheque was
negotiated and the proceeds paid to the owner … [P]ayment within the meaning of
the section requires not merely the tendering of the cheque but receipt of the
proceeds by the owners before the tendering of the cheque can be regarded as payment
within the provisions of that section. Absent payment, of course, the provisions
of s. 24 do not begin to operate."
written argument sets out submissions on whether, in light of Cariboo's failure
to make a payment under s. 19 (as found by the Court of Appeal), there has been
a valid expropriation. He contended that compliance with the advance payment requirement
in s. 19 is so fundamental to the validity of an expropriation that non-compliance
would render an expropriation void and a nullity. This then, he argued, would
preclude s. 50 from applying, since the vesting of the property would not be effective
where the necessary prerequisites to the vesting had not been complied with.
Subsection 50 (1) provides:
"No legal proceedings
to challenge the validity of an expropriation shall be brought after land vests
under section 22."
In this case, the land
vested under s. 22 on May 29, 1991.
Mr. Frame relied on
the decisions of the Court of Appeal of British Columbia in Hornby Island Trust
Committee v. Stromwell (Kramer) and Dixon Lake Properties Ltd. (1988),
30 B.C.L.R. (2d) 383, and of the Supreme Court of Canada in Costello and Dickhoff v. City of Calgary,  1 S.C.R. 14, in support of his position.
THE RESPONDENT'S POSITION
Mr. McDannold, counsel for
Cariboo, took the position that I ought either to dismiss the application and
strike out paragraph 1 (b) of the amended claim or to find that the board has
jurisdiction to determine the compensation payable for the expropriation.
Mr. McDannold relied on ss. 50 (1) of the Act, and on the board's decision in
White v. Prince George (City) (1993), 50 L.C.R. 260. The White decision dealt
with a very similar situation to this. In that case the widow/executrix of a property
owner took the position, in the compensation proceedings, that no valid expropriation
had occurred, and only sought compensation for an expropriation in the alternative.
The claimant cited five reasons for concluding that no valid expropriation had
taken place. Two of the reasons related to invalid service of the expropriation
notice, the third was that the expropriation by-law was a nullity because its
fourth reading took place after the vesting, the fourth was that the vesting was
filed in non-compliance with the formalities of the Act, and the final reason
was that one cannot expropriate from a dead person. In the White case, s. 50 was
argued by the expropriating authority, as it is here.
The board in White concluded at page 273 of its reasons that:
"The board is not without concern for an owner who discovers,
after the vesting notice has been filed, that irregularities exist in the procedures
followed by an authority. They may or may not have remedies in other forums such
as the Supreme Court, but it is the opinion of the board that the prohibition
asserted by s. 50 is not avoided by attaching a validity challenge to a compensation
claim before the board, as has been done in this case.
Accordingly, the board is precluded from making the determination the claimant
In light of the decision in White,
Cariboo argued that s. 50 absolutely precludes the Cejkas from raising any challenge
to the validity of the expropriation.
4.1 The Relief Sought
I find Mr. Frame's contention that the Cejkas have taken no position in this application
an untenable one for the following reasons:
The Cejkas were the ones who set down this application, in the context of their
claim for compensation arising from an expropriation.
2. Paragraph B of their Statement of Claim, cited above, suggests that the vesting
notice is "void and is a nullity" due to Cariboo's failure to comply with s. 19.
3. In paragraph B, the Cejkas "suggest that the Expropriation Compensation Board
may not have jurisdiction to adjudicate compensation" for this reason.
4. Mr. Frame referred me to case authorities which, if I were to accept them as
standing for the principles for which he cited them, would support the proposition
that failure to comply with statutory prerequisites in expropriation legislation
results in an expropriation being void and a nullity.
In the White decision, the board summarized the claimant's position at p. 270:
"… the board is being asked by the claimant to find that there
has been no expropriation despite the authority's assertion that this has been
the sole purpose of its actions in relation to the subject lands and despite the
fact that a vesting order has been filed with the land title office."
Later, at p. 271, the board commented on the claimant taking such a position within
the context of a claim for compensation:
is of critical importance in a compensation claim, is the unconditional assertion
by a claimant that there has been a taking and that compensation is to be determined
by the board.
The board is of the
opinion that the combined result of the pleadings and the argument now made by
the claimant's counsel, is to challenge the validity of the expropriation by having
this board declare that no valid expropriation occurred. In the opinion of the
board, this is fundamentally inconsistent with the pursuit of compensation before
I see no difference between the
Cejkas' situation and that of Mrs. White. It is not possible for the Cejkas to
resile from the position that they are actually taking simply by purporting not
to be taking a position. Like the board in White, I find that putting forward
the "suggestion" that the expropriation is void and a nullity is fundamentally
inconsistent with the simultaneous pursuit of compensation before the board. The
fact that Mrs. White was more overt about the position that she was taking than
are the Cejkas does not negate the practical similarity between their situations.
I therefore view the Cejkas, through their filed pleadings and the arguments of
their counsel, as effectively taking the position that there has not been a valid
expropriation in this case.
4.2 The Effect of Non-compliance
with s. 19 (1) (d)
Mr. Frame referred me to the only
reported decision of the board that resulted in a compensation hearing not proceeding
on the basis that there had been no expropriation to provide the board with jurisdiction
to conduct such a hearing. That decision was handed down in McKinnon v. Duncan
(City) (1992), 47 L.C.R. 47. The flaw in the expropriation process in that case
was that the expropriation by-law promulgated by the City of Duncan, which purported
to expropriate a right of way, was so unclear as to make it "impossible for the
owner to identify which of his remaining lands [were] subject to the right of
way." The board found that it had no jurisdiction to determine compensation, because
it could not determine the precise nature of the interest in land taken for which
the compensation was sought. As the board in White characterized it, "it was a
matter of the substance of the by-law … that precluded the board from its determination
of compensation." The McKinnon case did not, in other words, turn on whether a
requirement of the Act had or had not been complied with, not on the effect of
Mr. Frame referred me to the Hornby
Island and Costello and Dickhoff decisions for the proposition that, where an
authority has failed to comply with the provisions of the Act, there is no valid
The Hornby Island case did not deal with
an expropriation, but simply with the issue of the validity of a municipal by-law.
In that case, the by-law at issue was adopted without the advertisement of a synopsis
as required by a provision of the Municipal Act. The Court of Appeal held,
at p. 388 of the reported decision, that:
"… a by-law that is adopted without observance of a necessary statutory precondition
is wholly void from the outset, and not merely voidable."
They viewed the advertising requirement as being just such a necessary statutory
precondition, and therefore declared the by-law to be void and a nullity from
the time the municipality purported to adopt it.
and Dickhoff was an expropriation case, dealing with whether the City of Calgary's
failure to comply strictly with the statutory service requirements regarding notice
of meeting prior to the promulgation of an expropriation by-law rendered that
by-law void or merely voidable. The statute in question in this case was the Alberta Expropriation Procedure Act, which set out provisions governing expropriation
by municipalities in Alberta. The Supreme Court of Canada, in arriving at the
conclusion that the expropriation by-law was void, held at p. 22 of the reported
"Where it is provided that a power
is to be exercised in a certain manner or after a prescribed condition has been
complied with, it becomes necessary to determine whether any of these limitations
on the grant of authority may be disregarded without entailing a nullification
of an act done otherwise than in the prescribed manner. If, in order to carry
out the essential purpose of the legislature, strict compliance with the statutory
provisions appears to be a condition precedent to the exercise of the power, non-observance
thereof is fatal to the validity of the by-law." (Emphasis added.)
Unlike the present matter, both Hornby Island and Costello and Dickhoff deal with
non-compliance with provisions in the statute that granted the original power
to pass a by-law. In the Costello and Dickhoff case it was a by-law regarding
an expropriation. The Act with which I am concerned does not contain any provisions
granting expropriating powers. As Goldie, J.A. pointed out in Seaside Acres
Ltd. v. Pacific Coast Energy Corp. (1994), 52 L.C.R. 106 at p. 113,
with reference to the Act:
"The Act regulates
expropriations. It does not confer a power of expropriation. This is apparent
from the definition of expropriating authority in s. 1 and from ss. 4 (2) and
13 (2) which exclude challenges under the Act to the right to expropriate and
to the necessity to expropriate respectively." (Emphasis added.)
There are, therefore, to my knowledge, no decisions of the board or of any higher
authority reviewing the board's decisions, in which failure to comply with any
provision of the Act has been held to invalidate an expropriation.
I do not view s. 50 as providing a complete answer to every challenge to the validity
of an expropriation once vesting has taken place. As occurred in McKinnon and
Costello and Dickhoff, there are situations in which the expropriating by-law
itself may be so flawed as to be void, or in which the provisions of the statute
granting the authority to expropriate in the first place may not have been complied
with, thereby preventing a compensation board from having the requisite jurisdiction
to determine compensation. (I should point out here that it is not necessary for
me, in the context of this application, to decide the issue of the board's authority
to make a determination that an expropriating authority has not properly exercised
its statutory authority in the act of expropriation.)
In the case at hand, this type of invalidity is not alleged. The only failures
of the expropriating authority that are alleged relate to s. 19 of the Act itself.
This brings the case, in my view, in line with the White decision, and the application
of ss. 50 (1). I agree with the reasoning and the conclusion of the board in White,
and I find them to be applicable to this case. I therefore find that ss. 50 (1)
does apply to this situation, and that for that reason it is not available to
the Cejkas to challenge the validity of the expropriation through paragraph 1
(b) of their amended claim for compensation, as they have attempted to do. I therefore
determine paragraph 1 (b) by finding that the board does have the jurisdiction
to hear this compensation claim.