Here's one we're now following, thanks to a heads-up from a northern colleague.
The Supreme Court of Canada has granted leave to appeal in a case involving what Canadian law calls "de facto expropriation" (what we'd call "regulatory takings").
Before you review the Application for Leave to Appeal by the property owner, and the responsive memorandum for the government, recall that even though Canada's approach to "takings" is not a constitutional question, but nonetheless like the southern version of the doctrine, focuses on whether some government act has the effect of acquiring from the owner a beneficial interest, or removed all reasonable uses. See Canadian Pacific Railway v. Vancouver (City), 1 S.C.R. 227, 2006 SCC 5 (2006).
In Annapolis Group Inc v. Halifax Regional Municipality, the Supreme Court will consider whether Halifax's refusal to approve Annapolis' development applications (consistent with its residential zoning, more specifically "future serviced development") on Annapolis' 965 acre parcel resulted in an de facto expropriation. Instead, Halifax "promoted the Annapolis Lands as a park by inviting the public to use them as such and permitting its logo to be placed on trail signs directing the public onto them." Annapolis factum at 53.
Add to the mix that Canada law recognizes what we might call a "pretextual de facto expropriation" (our characterization, not Canada's), which notes that when property is in fact taken outside the usual legislative expropriation process (which includes the requirement of making the property owner economically whole for all attendant losses) for some "ulterior motive," this is actionable as a "disguised" expropriation. Lorraine (Ville) v. 2646‑8926 Québec inc., 2 S.C.R. 577, 2018 SCC 35 (2018). Here, Annapolis asserted that Halifax treated the property like a public park, yet did not zone it for future public use (because such a designation carries with it the obligation to purchase the land within one year of the designation.
Neither the provincial trial court nor the Nova Scotia Court of Appeal bought the owner's arguments, dismissing Halifax's motivations as irrelevant, and concluding that the city did not deprive Annapolis of reasonable use, or otherwise acquire a beneficial interest in the land.
The Supreme Court accepted discretionary review. As the Application for Leave put it:
The law of de facto expropriation in Canada requires development. As Professor Russell Brown (now Justice Brown) observed in academic articles, the two-step test established by this Court in CPR, and particularly the requirement to prove an acquisition of a beneficial interest, collapses the distinction between de jure and de facto expropriation and has effectively abolished liability for de facto expropriation. Through this appeal, this Court will have the opportunity to address the test in CPR and bring the law of de facto expropriation in line across Canada.
Annapolis factum at 54-55. [Barista's note: then-Professor Brown wrote the Canada chapters in the "Takings International" book you might be familiar with, and more than a decade ago, we shared the podium with him to talk about the Canadian approach and his thoughts about how Canadian Pacific Railway undermined the goal of full compensation to owners whose property was being pressed into public service by regulation.]
The case presents two issues:
(a) Should the test for de facto expropriation established by this Court in Canadian Pacific Railway v Vancouver (City) be revisited?
(b) Must the Court ignore the motive of a government authority in considering whether a “taking” occurs in a de facto expropriation case?
Id. at 58.
The government doesn't have to acquire a beneficial interest in order to have effected a de facto taking. Acquisition of a beneficial interest, after all, looks like plain old physical invasion takings, and there's something different about those than situations where the result looks an awful lot like an affirmative expropriation from the owner's view, yet the government has not actually acquired some interest. Maintaining the beneficial interest requirement is tantamount to abolishing the de facto expropriation doctrine, the owner's factum argues.
Are we going to watch closely a case which asks the court of last resort to reevaluate the takings rule that allegedly "collapse[s] the distinction between de jure and de facto expropriations?" As we've noted before, there's a lot we U.S. lawyers can learn from the way Canada analyzes this stuff even though it isn't a constitutional doctrine.
Yes (or oui, if you prefer), of course: we're going to pour ourselves a cup of Timmys double-double and follow along as this one develops. You can also keep updated on the Court's e-docket. Stay tuned.
Application for Leave to Appeal, Annapolis Group Inc. v. Halifax Regional Municipality, SCC No. 39594 (Can....
