February 28, 1997, E.C.B. Control No. 24/94/134 (60
Majesty The Queen in Right of the Province of British Columbia
as represented by the Minister of Transportation and Highways
E. Ross, Presiding Member
Julian K. Greenwood, Board Member
Azim S.M. Jamal, AACI, FRICS, RI(BC), Board Member
S. Cosburn, for the Claimant
Sarah I. Macdonald, for the Respondent
In 1994, the Ministry of Transportation
and Highways (MoTH) was improving the "Pat Bay Highway",
which takes traffic from Victoria, B.C. out the Saanich
peninsula to the airport and the main ferry terminal.
This involved the redesign of some intersections. The
claimant owned and lived on a small acreage on Wain
Road in North Saanich, several properties west of the
intersection of that road with the highway. The redesign
of this intersection involved building a new overpass
over the highway which east-bound Wain Road traffic
would use to get onto the highway going north. Wain
Road was realigned slightly as it approached the redesigned
intersection. This realignment began just in front of
the claimant's property, and required an expropriation
of a small triangle (140 sq.ft.) from the front of the
The claimant was affected to some
degree by the loss of this triangle of land, but much
of her aggravation was related to a perceived delay
by MoTH in proceeding with its project and to the ramp
which was built to connect Wain Road to the highway
overpass. Although that ramp was not on her land, it
was a large and visible construction where there had
previously been a view of trees. Her property, which
had once felt reasonably secluded from highway traffic,
was now overlooked (admittedly at some distance) by
traffic using the overpass, and from the back of the
property one could now hear and see traffic using the
Both parties presented cases which
assumed a right of compensation for loss in value to
the remaining property caused by the interchange project
in general, including harm caused by the ramp, and not
simply harm caused by the small taking from the front
of the subject property. This means that the parties
did not argue the principle outlined in cases such as
Edwards v. Minister of Transport, 
1 All E.R. 483, that in partial taking situations, compensation
can only be claimed for loss in value to the remaining
property which arises from activities upon the expropriated
land. It may be that those issues will arise on another
occasion, and this decision cannot be taken as authority
one way or the other in that regard.
2.1 The property and its relation
to the interchange works
The subject property was a narrow
rectangle 1.72 acres in size. It had a 120 ft. frontage
on Wain Road, and was about 624 ft. deep. Pat Bay Highway
is a busy four-lane highway, which crossed Wain Road
some 1000 ft. to the east. There were several lots and
substantial stands of trees between the subject property
and the highway. Though a small part of the highway
was visible from the claimant's property, it did not
interfere greatly with the claimant's lifestyle prior
to the redesign of the Wain Road interchange.
The claimant's house was a 790 sq.
ft., one-story, part-basement home with a single garage.
It was sited 45' from the front of the lot, or about
68.5 ft. from the pavement on Wain Road. The front yard
was screened from Wain Road by trees along the north
lot line. The claimant worked from home as an environmental
consultant and antique furniture restorer. She had converted
the garage into a workshop for her furniture business.
In the deep rear yard she engaged in organic gardening,
growing medicinal plants and vegetables.
Reconstruction of the Wain Road interchange
began in 1994, and in preparation for that work, a small
triangle of property, 2 m. or 6.56 ft. wide at its widest
point, and 13 m. or 42.65 ft. long, was expropriated
from the front of the property. This meant that the
new road pavement now came within about 47 ft. of the
house at its nearest point. This pavement was the beginning
of a bend realigning Wain Road as it approached the
highway and an upward ramp which would carry traffic
to an overpass over the highway. The realignment continued
in front of the two houses and lots to the east of the
claimant, which were rather more significantly affected.
At its nearest point, the ramp was
310 ft. from the eastern boundary of the subject property.
In spite of that distance, the claimant argued that
her land and her activities on the land, were significantly
affected by the overpass ramp. Not only did the visibility
of the ramp eliminate the semi-pastoral feel of the
property, she felt that the presence of the ramp would
actually affect her gardening activities. Wind and frost
patterns would change; highway maintenance would involve
chemicals inimical to her organic gardening, some of
which would find their way into the groundwater; it
would be less likely that she could construct a well
on the property; runoff from the highway would affect
drainage on her property.
2.2 Advance payments
The expropriation notice was issued
on May 20, 1994. On June 8, 1994, the claimant was paid
an advance payment of $5,900 for the market value of
the property taken ($500) and loss in value to the remainder
($5,400). These amounts were based on a valuation opinion
of David Osland dated May 3, 1994.
The notice of advance payment was
later amended to break it down between $5,051.64 for
the claimant and $848.36 to be paid directly to the
mortgagee. Since that $848.36 was used to pay down the
mortgage balance, it also is treated as having been
received by the claimant on the date it was paid to
the mortgagee (June 30, 1994). The claimant was not
required to pay back money she had earlier received.
The vesting notice was registered
July 4, 1994.
Two years later, on July 2, 1996,
MoTH made a further advance payment based on a revaluation
of the claim at $13,100, and a valuation of disturbance
damages at $1,352.48. (When this amount is added to
the $848.36 used to pay down the mortgage, the total
of these two amounts is $2,200.84, a figure used later
in this decision in considering miscellaneous damages.)
After consideration of payments already made, the further
advance payment was calculated as $9,052.48, to which
interest of $1,638.18 was added. The final result is
that the claimant should be treated as having received
the following amounts on or before July 4, 1994:
|Payment to mortgagee
2.3 The project and how it
A major complaint of the claimant
was that the expropriation was poorly handled, resulting
in unnecessary uncertainty and distress for the residents
of the area. The fact that there would be alterations
to the Wain Road intersection appears to have become
public knowledge by December 1993, yet it was not until
May 20, 1994 that the expropriation notice was served
on the claimant. The first formal event was a North
Saanich Council meeting on January 4, 1994 at which
the new interchange was discussed, with some hostile
reaction from residents. Subsequently, a neighbourhood
liaison committee was struck through which residents
were to communicate with MoTH. The claimant and other
residents demanded to be told with some certainty whether
they would be expropriated and to what extent. Alternative
plans were suggested by residents, and it would appear
that some part of MoTH's delay was associated with receiving
and considering this input from the neighbourhood.
Expropriations of some neighbourhood
properties took place early in the year, as work began
on those properties. In late January, 1994, a house
belonging to the Budesheims was demolished to make way
for the ramp. Trees were being taken off the Budesheim
property in March. The next major development was the
creation of a large rock or gravel pile on what was
referred to in the hearing as the McMillin property,
two properties to the east of the subject, and just
to the west of the Budesheim property. Much of this
gravel was then used to build the ramp.
During this construction other neighbours,
including the claimant and her neighbours immediately
to the east of her (the Foxgords), continued to be uncertain
as to how much of their properties would also be expropriated.
On March 4, 1994, the claimant brought a petition in
the Supreme Court asking for an order requiring MoTH
to proceed with its expropriation of her property. In
the end this petition did not proceed to hearing, but
it displays the degree of anxiety the claimant felt
at the time.
Once the expropriation decision was
made on the claimant's own property, matters proceeded
fairly quickly. As soon as the vesting order was registered
(July 4), construction began on the realignment of Wain
Road in front of the claimant's house. The balance of
the work connecting Wain Road to the ramp seems to have
been completed in July.
These events led the claimant to
advance a claim for a loss of use and benefit of her
property for the nine months between the beginning of
January, 1994, and the approximate date the project
was complete, which she treated as the end of September
2.4 Effect on claimant's business
and personal uses of the property
Until early 1994, the claimant had
been making a modest living on the property restoring
antique furniture. She had adapted her garage into a
workshop, where she had a substantial set of tools.
She also did some environmental consulting work from
time to time. Finally she had a keen interest in organic
gardening, and grew vegetables on the property. She
had occasionally taken produce for sale in the Moss
St. market in Victoria. She had intentions to open a
roadside stall in front of her property to sell produce
more directly, but had not taken any active steps to
The announcement of MoTH's plans
for Wain Road coincided with a potentially suitable
job opening at the District of Saanich, a nearby municipality.
On January 13, 1994, the claimant went for a job interview.
She was successful, and started work as an environmental
planner shortly after. Around the same time she stopped
taking in more furniture restoration work. Her workshop
was in any event full with incomplete projects at the
end of 1993, and she finished these off in the first
three months of 1994, and treated income earned from
those jobs as 1993 income.
The claimant did not pursue her gardening
with any vigour in 1994. She decided as early as January
that she was likely to sell the property if she was
not fully expropriated. Even after it became clear that
only a small amount would be expropriated, she maintained
her intention to sell. She also decided that there was
now insufficient room to place a produce stall by the
The result was that the claimant
did not conduct her furniture restoration business or
her gardening in 1994, except to a minor extent. She
blamed this on the roadworks. The uncertainty before
May 1994, the noise and dust of construction from April
to July, and the certainty that there would now be a
permanently greater level of highway noise after the
changes were complete, rendered her traditional activities
either unpleasant or impossible, in her view.
These observations were the basis
for claims to the board for personal and business losses
-- particularly loss of income from the business of
2.5 Sale of the property
The claimant told the board that
living on the property lost its appeal for her as a
result of the highway project. She cited as reasons
not only the loss of privacy in the rear yard, and the
greater immediacy of the road in front of the property;
an important factor was that her small community of
close neighbours and friends had been broken up. She
confirmed her decision to sell, and listed the property
in September 1994 for $245,000. Her realtor, Jan Garnett,
had in fact been consulted back in January, but the
decision to sell had been put on hold during the construction
Jan Garnett testified that she held
several open houses, including two right at the start
for realtors only. She noted that the "average" opinion
of likely sale price expressed by those realtors was
just under $230,000, and that she should be able to
sell it for as much as $240,000 to the right person.
In fact, Ms. Garnett found keen buyers
within about a month, and an offer for $230,000 from
the Bittens was accepted on October 20, 1994. This offer
was, however, subject to the sale of the Bittens' existing
home in Sidney. Ms. Garnett obtained that listing herself
and then attempted to sell both properties. Unfortunately,
the property market was declining in the second half
of 1994 after rising steadily from January to July.
The Bittens' property did not sell, and Ms. Garnett
had to continue to try to find back-up buyers for the
Her notes show that this was not
proving easy. A number of buyers commented negatively
on the proximity to the highway. No doubt the souring
market conditions were also a factor. The listing price
on the subject property was reduced slightly in November;
the same was done for the Bittens' house in December,
but still the Bittens' house did not sell. Eventually
the claimant accepted a new offer from the Shaws. The
offer was for $215,000, and it was accepted in late
February 1995. The Bittens were not prepared to waive
their condition, so they lost the property, and it sold
to the Shaws.
This evidence was produced in support
of a claim that the respondent should pay for a loss
realized on the sale. The claimant's appraiser had said
that the property was worth $225,000 after the taking.
Since it in fact sold for only $215,000, the claimant
argued that she had suffered a further loss of $10,000
which was compensable.
3.1 Market value of land taken
(the 140 sq. ft. or 13 sq. m.).
There was no serious issue on this.
The claimant valued the land taken at $350. MoTH valued
it higher at $500, and included that amount in its advance
3.2 Loss of value to remaining
The remaining property was said to
be negatively affected by the taking, both because of
the realignment of Wain Road towards the house, and
because of the construction of the overpass ramp over
the McMillin and Budesheim properties to the east. The
realignment of Wain Road was said to have reduced the
front yard, made road noise more significant at the
house, reduced the area available in front of the house
for turning or parking vehicles, or for establishing
a produce stand, and made driving in and out more hazardous.
The ramp contributed to a loss of privacy and sense
of seclusion in the back of the property.
The claimant's expert valued the
loss in value to the remainder at $29,650. MoTH's expert
countered at $13,100. There was therefore a difference
of opinion of $16,550.
3.3 Disturbance damages.
The claimant claimed a total of $22,740.25
under this general heading. This included items that
might better have been called personal or business losses,
but MoTH elected not to contest the categorization of
these claims as between s. 33 (1) (a) and s. 39 (1)
(b) of the Act. In this overall amount the claimant
included the following heads of damage:
|Loss on sale of
|Loss of income from
her home business of furniture refinishing:
|Loss of use and
benefit of the property from January to October
associated with the expropriation and construction:
MoTH's advance payments included
$2,200.84 which could be identified generally as referable
to disturbance damages or personal or business losses.
The difference between the parties was therefore some
3.4 Costs and interest
The claimant sought costs and interest
under ss. 44 and 45 of the Act.
4. THE APPRAISALS
4.1 Claimant's appraisal evidence
Ms. Rita C. Thibault, AACI, of Thibault
and Company Appraisals Inc., testified for the claimant.
Her report, dated April 22, 1996, estimated the loss
in value of the subject property due to the partial
taking at $30,000.
Thibault found the value of the property
before the taking to be $255,000. She used both a direct
comparison approach and a cost approach. The land value
she found for the cost approach was $180,000, or $2.40
per sq. ft. Applying this to the 140 sq. ft. actually
taken, she concluded a rounded value of $350.
To determine loss of value to the
remainder, Thibault used a "before and after" approach,
which by its nature values both the land taken and the
loss of value to the remainder. According to Thibault,
no comparable evidence of "after" value was available
in the subject's area. As an alternative, she looked
for evidence of the percentage difference of value between
properties that are sited on quiet streets and properties
on busy streets in the Victoria area. Her analysis of
sales obtained from the Multiple Listing Service (MLS)
of the Victoria Real Estate Board resulted in a range
for this difference from -2.74% to -29.88%. The average
of this range was -22.20%, which Thibault felt was excessive
for the subject, considering that it was some distance
removed from the overpass. She contemplated a 50% reduction,
reducing the indicated percentage difference to -11.10%,
but she was not satisfied with this figure, and felt
a smaller adjustment was required. She further refined
this figure by taking the second lowest figure (-13.72%)
from her set of comparisons, and averaging it with the
figure of -11.10% to arrive at -12.4% as her estimate
of the percentage difference of value between "before"
Using this finding, she concluded
that the subject was in effect being changed from a
home on a quiet street to one on a busy street, so that
the loss of value would be 12.4% of $255,000, which
she rounded down to $30,000.
Thibault was also asked to give an
opinion on the loss associated with a temporary reduction
in saleability of the property, or reduction in its
rental value, in the months before and during the construction.
She dealt with the period from January 6, 1994, when
the Ministry first announced work on Wain Road, to the
end of September, 1994, when the project was substantially
complete. She was asked by Mr. Cosburn, claimant's counsel,
to quantify the loss of use and benefit of the property
for this 9 month period. She approached it two ways.
First, she assumed that the property was sold at the
beginning of the period, the proceeds invested, and
the vendor rented a 2-bedroom apartment. She estimated
the owner would accumulate $4,569 over the period as
the excess of interest over rent. (The board questioned
the validity of this calculation since it was based
on the gross sale value rather than on the net amount
after payment of the mortgage balance.) Secondly, Thibault
estimated what the property would have rented for during
the period, compared to a more normal period. She decided
that the rental loss would be 50% of $450/month, and
in addition there would be a two month vacancy. Over
9 months this would amount to $4,950. She picked a number
in between these two estimates as her estimate of loss
of use and benefit: $4,750.
4.2 Respondent's appraisal
MoTH retained Mr. D.T. Osland, AACI,
RI(BC), of Baker & Osland Appraisals Ltd. His report,
dated May 30, 1996, gave the opinion that "the loss
in market value due to the land taken" was $13,600.
It was apparent that Osland, like Thibault, was measuring
both the market value of the piece taken and also the
loss in value to the remainder. His report, indeed,
was superficially similar to that of Thibault in approach.
He concluded a slightly lower value for the property
before the taking ($252,000), although he thought the
land component of this was higher ($189,000). His estimate
of the value of the piece taken was $400, compared to
Like Thibault, Osland sought to measure
the loss in value to the remainder by an indirect means.
His method was somewhat different than that of Thibault,
however. Instead of comparing average values of residential
properties that sold in a certain period in different
locations, Osland looked for pairs of sales of physically
similar properties, one of which was affected by proximity
to an undesirable neighbour, like a busy road, a sewage
treatment plant, or a hotel with a pub. He used a number
of such pairings drawn from six comparable properties
or developments, which showed price reductions for the
more affected property in each pair between 2.5% and
12.8% of the price of the unaffected property. He decided
that the land values would be affected less than improvement
values. The subject property, he said, would experience
greater traffic impact from Wain Road and the ramp,
would have the visual impact of the ramp, and some loss
Osland narrowed his analysis to a
couple of comparables for which the type of impact was
most similar to the situation of the subject property,
although the severity of the impact was still considerably
greater than that experienced by the subject. He recognized
that the improvements in these comparables were constructed
with knowledge of the adjoining circumstances, which
was not the case for the subject improvement. With the
exception of one vacant land comparable, his examples
reflected a loss of value to the improvements as well
as to the land. He was unwilling to assume that the
percentage impact would be the same on the improvement
as on the land, and therefore further refined his earlier
analysis to estimate separately the loss to the land
and the loss to the improvement.
For the land component, Osland considered
first the vacant land sale comparable, which indicated
a range of value loss between 4.1% and 7.1%. He felt
that the lower end of the range was most appropriate,
since the loss in value for the subject was less severe
than for the comparable. He also reviewed the two most
comparable improved sale pairs, which he felt were more
severely affected by roadways than the subject, and
concluded that these confirmed the value impact on the
land component of the subject should be less than 5%.
With respect to tbe building component,
Osland went through the same exercise. Considering the
two most comparable properties, he found a range of
-15.9% to -20.0% for his pairs of comparables. Recognizing
the different degree of severity of impact between the
comparable pairings and the subject, he decided these
percentages were too high and concluded 10% was appropriate.
In the result, Osland applied a 4%
reduction to the land, and a 10% reduction to the improvement.
This led him to conclude that the loss in value due
to proximity to all the negative factors was $13,200.
This he added to the $400 previously found for loss
of land, to give a total loss estimate of $13,600.
51. The appraisals -- market
value of land taken and loss in value to remainder.
The important difference between
the appraisers is not in their initial ("before") value
estimates, but in the percentage reductions they chose
to determine loss in value to the remainder. Whether
one starts with $255,000 or $252,000 is insignificant,
and indeed both appraisers conceded in their testimony
that their margin of error was large enough to include
the value opinion of the other. The Board is content
to use a number between the two: $253,500.
The main difficulty is with the methods
chosen (by both appraisers) for determining loss in
value. In spite of Thibault's assertions, she did not
determine an "after" value. She and Osland both decided
that the value loss to the remainder would be a percentage
of the "before" value.
The evidence from which Thibault
arrived at her percentage reduction was weak. The problem
is that there is no easy way of comparing the neighbourhood
disamenity in the subject case with the examples chosen.
The board was not persuaded that a percentage reduction
for living on Shelbourne St., Bay St. or McKenzie Ave.
in Victoria, compared to other side streets, should
result in a similar percentage deduction for the subject.
The situations are very different. The chosen main streets
are very busy thoroughfares, substantially less desirable
for single family residences than they might have been
in the past, when many of their remaining homes were
built. By contrast, the subject site is affected more
by a change of view or of the path of traffic than a
change of traffic volume.
Secondly, Thibault simply averaged
all residential sales in a certain period in certain
Victoria neighbourhoods, separated only by whether they
were on or off the chosen busy street. There were many
other factors, such as size of lot, size, age or condition
of improvement, that would be completely masked by this
technique; yet there was not such a volume of sales
that one could say the individual differences would
become unimportant in the statistical conclusions. In
fact, the evidence was to the contrary. There were only
three sales on McKenzie Avenue in Thibault's sample,
and they showed rather older, smaller lots and houses
than was typical on the less busy side streets.
Overall, Thibault's examples presented
too different a situation to the subject, and her statistical
analysis was unconvincing. As a result, the board was
unable to find her calculations probative.
The board was more impressed with
Osland's evidence as a way of finding percentage reduction.
Although it is hard to be sure that living next to a
pub or a sewage plant presents the same kind or degree
of disamenity as living next to an overpass ramp, this
at least is a more promising approach, and Osland presented
enough examples to convince the board of its potential
validity. Unfortunately, he left the board with a range
from 3 to 12 percent loss of value, but no particular
figure which was clearly superior within that range.
The appropriate percentage for this case was not resolved
by his evidence.
The board has considered, therefore,
whether there is direct evidence of the amount of loss
in value to the remaining property in the collapsed
sale of the subject property in October, 1994, and the
actual sale of the subject property in February, 1995.
We note that both appraisers had this sale evidence,
but chose not to use it in developing their "after"
value or their estimates of loss.
Thibault's comment on the February
1995 sale was that it supported her "after" value as
otherwise determined, of $225,000. She said that the
market had dropped generally by 4.53% between July 1994
and February 1995, and that if she applied that reduction
to the $225,000 the result would be close to $215,000.
Osland made much the same comment, but claimed that
the sale supported his "after" value of $238,400. He
thought that the property value would have declined
some 5% to 6% from July 1994 to February 1995, which
would indicate a value of $225,000 at the later date.
The fact that there had been an earlier collapsed sale
at $230,000, and certain comments made to him by others,
led him to conclude that the $215,000 actual price was
below market, and therefore should not be used directly.
The board observes that the statistics
used by each appraiser to measure the drop in market
over the months in question (July 1994 to February 1995)
showed considerable variation, although from the same
MLS source. Osland quoted figures for "all residential
sales" in Greater Victoria, which showed a decline of
6.8% on a "smooth average" basis, or 9.3% on the pure
monthly data. Thibault claimed that the figure for all
residential sales (including residential acreages) was
only 4.61%, while that for single family residences
only was 4.1%. It also appeared that Osland's figures
included data from lower priced areas outside Victoria
proper, but which were listed with the Victoria Real
Estate Board. None of this data was exclusive to residential
acreages like the subject.
The board has estimated the "after"
value from a consideration of both these sales. The
February, 1995 sale at $215,000, combined with an assumption
from all the above market data of a value decline of
about 5.3% between July, 1994 and February, 1995, indicates
a value in July 1994 of about $227,000. This is not
inconsistent with the collapsed sale of $230,000 in
October, 1994. The board therefore adopts $227,000 as
its estimate of "after" value.
5.2 Loss of business income
The claimant testified that she had
abandoned her woodworking or furniture refinishing activities
in 1994, because of the interchange project. She said
that she needed quiet surroundings to do this demanding
work, and that construction noises nearby were dangerously
disturbing. She noted that dust from construction made
activities such as French polishing difficult. She also
observed that the reduced front yard made it more difficult
for vehicles to come and go with furniture items. She
gave evidence that she had reported income from this
activity of $5,106 for 1993, and $6,132 for 1992, and
asked the board to conclude that she would have made
approximately $6,000 in 1994 but for the road works.
The board accepts that the claimant's
ability to continue her woodworking activity would have
been impaired, or made more difficult, by the construction
activity near her home, but is unable to accept the
claim for a total loss of income from this activity,
since it is not satisfied that the expropriation, construction
or subsequent use of the road works actually caused
her to cease the business. In fact she made a decision
as early as January 1994 not to take any more furniture
work, and she took a full-time job with Saanich that
month. She may have been influenced to do this by her
fears over what might happen, and her expectation that
she might move, but her actual decision to abandon the
work entirely, rather than attempt to continue it, is
not in the circumstances of this case the responsibility
As a further observation, if the
claimant had suffered a loss of business income caused
by MoTH's activities, she would be under a duty to mitigate.
In effect she did that by taking full-time employment
with the District of Saanich, which must have produced
an income which exceeded $6,000 in 1994. The claimant
did testify that she intended to take this job and continue
to do refinishing in her own time, but the evidence
is that she made no attempt to do this. Indeed, since
selling the property she has not tried to return to
her woodworking, and instead has made plans to live
on a boat.
A second element of personal or business
loss was advanced at the hearing, but never quantified.
This was the claim that the claimant's organic gardening
activities were curtailed by the events of 1994, and
that a plan to sell produce from a roadside stall were
effectively dashed by the moving of Wain Road. There
is very little evidence of any continuing income from
this source, although the claimant did estimate orally
that she might have earned about $1,000 in a previous
year from sales through the Moss Street market. The
board also notes that the claimant would have had to
seek various approvals to operate a roadside stand,
and without any evidence that such approvals had been
sought and obtained or would have been forthcoming,
the claim is speculative. The board finds this claim
has not been established.
5.3 Loss of use and benefit
of the property
The basis of this claim was that
MoTH created uncertainty in the way it communicated
its plans to the public from the beginning of 1994 until
it actually completed the project. The board was urged
to find that this gave rise to a claim for personal
losses under s. 39 (1) (b) of the Act. Thibault was
asked to quantify the claim, and the theory she advanced
was that the claimant was unable or less able to sell
or rent the property during the first 9 months of 1994.
Thibault therefore approached the
problem in two ways. In her first approach, she assumed
the property would have been saleable in January, 1994,
except for the uncertainty surrounding the project,
and that it was not again saleable until September or
October. Thus she calculated the cost of this "deferral"
of a sale opportunity on the basis of interest that
could have been earned on the proceeds of a sale in
January, less the cost of renting over the 9 months.
The net earnings, she estimated, would have been $4,569.
As noted earlier, the board had difficulty with this
figure because it was based on a gross sale price, not
on the owner's equity. A more serious objection, however,
is that this calculation contained a built-in flaw,
in that the property market had been climbing steadily
during the first half of 1994. Thibault recognized this
herself, in that she estimated (for the purpose of this
calculation) that the value in January would have been
$243,320, compared to a value in July of $255,000. Thus
on her own expert's evidence, the claimant would have
benefitted by holding the property rather than selling
between January and July.
Thibault's alternate calculation
was based on the assumption that the claimant would
have tried to rent the property to a tenant during this
period, but would have found it necessary to rent at
considerably lower rents (50% of normal market), and
that she would have suffered some two months of vacancy
even at those low rents. However, because no evidentiary
support was provided for Thibault's rent and vacancy
assumptions, the board is not inclined to accept that
they are applicable.
The result is that the claimant has
not proven this claim. Indeed the main effect of the
evidence is to convince the board that because the market
rose in the first half of 1994, the claimant was unintentionally
benefitted by MoTH if its conduct did restrain her from
divesting herself of the property in January.
5.4 Loss on sale of property
The other substantial claim presented
was for $10,000, being the difference between the property
value after the taking as estimated by Thibault ($225,000),
and the price eventually realized by the claimant in
her sale of the property in February 1995 ($215,000).
The short answer to this claim is
that it does not appear to have been caused by MoTH.
Thibault testified that the reduction from $225,000
to $215,000 was completely explained by a decline in
the general property market between July 1994 and February
1995. Osland gave similar evidence, and added that in
his view the price was below market for other reasons
peculiar to the claimant. It was suggested, but not
proven to the board, that the claimant might have been
less insistent on capturing full value if she felt the
difference could be recovered in this proceeding. Certainly
that would be a concern if the board was in the habit
of making such awards, but the board has no evidence
on which it could make such a finding in this case.
5.5 Miscellaneous disturbance
The claimant produced receipts for
expenses of various kinds which totalled $1,990.25.
One of the expenses claimed was for $435 in respect
of cracking to walls of the house occasioned by the
nearby construction. This claim was to have been dropped
if the claim for loss of property value was allowed,
but revived if (as has happened) the board declined
the latter claim. It was only an estimate, and not an
actual expense. The property was sold with the cracks.
Since the board has been unable to
find that the claimant suffered any compensable loss
on the sale of her property generally, it is inconsistent
to allow the $435 claim. She has already been compensated
for the loss of value to her property, which must be
treated as being a value "complete with cracks".
In its second advance payment, MoTH
allowed $2,200.84 for disturbance damages, but the board
is unable to sort out precisely what amounts have been
accepted by MoTH for payment and covered to date. The
board therefore awards a rounded amount of $2,000 for
all these miscellaneous claims.
6.1 Market value of land taken
The board has three figures to work
with: $500 was the amount paid for this item in the
advance payment. It had been based on an earlier appraisal
by Osland. In his later appraisal presented to the board
he chose $400. Thibault, proposed $350. The board finds
the original amount of $500 to be sufficiently justified
by evidence, and will not disturb it.
6.2 Loss in value to the remainder
The board has found that the "before"
value is $253,500, and the "after" value is $227,000.
The difference of $26,500 accounts for both the land
taken and any loss of value to the remainder. Thus the
loss of value to the remainder is $26,000.
6.3 Loss of use and benefit
The board denies this claim. It has
not been established that the claimant suffered any
financial loss by holding and living on the property
in the first half of 1994, rather than selling or renting
it in the same period.
6.4 Loss of business income
The board denies this claim on the
ground that the claimant has not proven that she suffered
any loss, or that her decision to discontinue her refinishing
activities can be said to have been caused by the expropriation
or the roadworks.
6.5 Loss on sale of property
The board denies this claim on the
ground that any loss of value to the property from July
1994 to February 1995 is more likely to be associated
with the general downturn in the market than to any
6.6 Miscellaneous disturbance
The board awards $2,000 for all the
miscellaneous remaining expenses claimed.
The board awards the following amounts:
|Market value of land taken
|Loss in value to remainder
||Miscellaneous disturbance damages
||Advance payments totalled
|Difference, as of July 4, 1994
Interest under s. 45 is awarded on
the net amount of $12,700 from July 4, 1994 to the date
of this decision. Since the advance payment is less
than 90% of the amount found due by the board, additional
interest at the rate of 5% is also payable pursuant
to s. 45 (4). If the parties have difficulty agreeing
on the precise amount of interest, the board will issue
a further order.
The award in this case being more
than 115% of the advance payment, the claimant would
normally be entitled under s. 44 (4) to her actual reasonable
legal, appraisal and other costs. At the compensation
hearing, however, MoTH requested that no order of costs
be made without it first being given an opportunity
to argue the effect of a so-called "Calderbank clause"
in a settlement offer it made to the claimant. In these
circumstances, MoTH will have 14 days from the issuance
of this order to advise the board registrar whether
it wishes to pursue the Calderbank issue, in which case
the board will set a schedule for submissions from both