October 22, 2001, E.C.B. No. 32/97/213

REASONS FOR DECISION

1.  INTRODUCTION

[1] The claimants, Ralph Hubert Williams and Lois Lewine Williams, own land near Hedley, British Columbia. The respondent, Her Majesty the Queen in right of the Province of British Columbia as represented by the Minister of Transportation and Highways (the "Ministry"), required a portion of the Williams' land in connection with a bridge over the Similkameen River. Initial attempts to negotiate compensation were unsuccessful. However, on March 5, 1996, the claimants and the respondent entered into an agreement pursuant to section 3 of the Expropriation Act, R.S.B.C. 1996, c. 125 ("the Act") whereby the Williams agreed to transfer the required land to the Ministry.

[2] The Williams have brought this application to ask the board to determine that their claim is not barred by a limitation period. The question is whether the limitation period expressed in section 25 of the Act applies when the compensation claim follows an agreement under section 3 of the Act rather than a formal expropriation.

2.  BACKGROUND

[3] Section 3 of the Act provides that an owner and an expropriating authority can enter into an agreement to transfer land but leave compensation to be determined by the board. Section 3(1) of the Act states:

3 (1)	If an owner or, if there is more than one owner, all owners agree to transfer or dedicate land to an expropriating authority without expropriation, but cannot agree with the expropriating authority on the compensation to be paid,
	(a)	Parts 2 to 4, other than section 20, do not apply,
	(b)	the board must determine the compensation to be paid to the owner as if the land had been expropriated under this Act, and
	(c)	unless the parties to the agreement otherwise agree, compensation must be determined effective the date the owner agreed to transfer or dedicate the land to the expropriating authority.

[4] There are various requirements of such an agreement which are set out in section 3(2) as follows:

3 (2)	An agreement under subsection (1) must be in writing and must state
	(a)	that the owner consents to the transfer or dedication,
	(b)	that compensation must be determined by the board,
	(c)	the date set for possession of the land,
	(d)	that the owner must take the necessary steps to transfer or dedicate the land to the expropriating authority, and
	(e)	that the expropriating authority must make an advance payment under section 20.

[5] The section 3 agreement signed by the claimants complied with all of these requirements. Following on the section 3 agreement, on March 7, 1996, the Ministry sent to the lawyer initially representing the Williams the executed agreement, an appraisal, a notice of advance payment in the amount of $24,100, and a cheque for $24,100.

[6] Section 25 of the Act provides:

25

If an application is not made to the board to determine compensation within one year after payment is made under section 20, the owner whose land was expropriated is deemed to have accepted that payment in full settlement of his or her claim for compensation, and proceedings to determine compensation must not be brought by that owner.

[7] If this section applies, then the owners, who had received their advance payment on March 7, 1996, had to apply to the board to determine compensation before March 7, 1997. Unfortunately they did not do so. There were continuing negotiations between March and September, 1996, followed by a period of inactivity. Then, on April 30, 1997, the lawyer representing the Williams sent the claimants' Form A application to determine compensation to the board. It was received and stamped by the board on May 2, 1997. The Ministry was served with the application on May 6, 1997. The Ministry did not immediately object that the application was out of time; indeed, there were further discussions that May about some minor matters.

[8] In early June, 1997, the lawyer representing the Williams sent the Ministry a copy of his account for services rendered to his clients to date and requested reimbursement. Advance payment of costs for legal expenses are contemplated by section 48 of the Act. This request appears to have triggered an examination of the file, as a result of which the Ministry wrote to the Williams' lawyer on June 12, 1997, claiming the benefit of section 25. The claim, said the Ministry, is "deemed settled". Subsequently, on July 3, 1997, the Ministry filed its Form B reply to the claimants' application for determination of compensation, in which it formally raised the limitation defence.

[9] The board is now asked to determine whether the Ministry is correct, and whether the claim is indeed barred. The hearing, on the limitation issue alone, was conducted by video conference with participants in both Penticton and Victoria. Counsel for the Williams on this application was not the same counsel who initially represented them. Subsequent to this hearing, on June 5, 2001, the British Columbia Court of Appeal released its judgment in Golden Valley Golf Course Ltd. v. British Columbia (Minister of Transportation and Highways) (2001), 73 L.C.R. 81. Since that judgment made observations with respect to both sections 3 and 25 of the Act, the board invited the parties to make further written submissions with respect to its effect on the present application. They did so under cover letters received by the board from counsel for the Ministry on July 30, 2001, and from counsel for the Williams on July 31, 2001.

3.   THE WILLIAMS' POSITION

[10] The Williams ask the board to rule that section 25 of the Act does not apply in the context of a section 3 agreement. In their submission, the wording of section 25 only bars a late compensation claim by an owner who has been "expropriated". The definition of "expropriate" in section 1 of the Act says that it is a taking "without the consent of the owner". Further, section 12 of the Interpretation Act, R.S.B.C. 1996, c. 238, provides that definitions in an enactment apply to the whole enactment unless a contrary intention appears in the enactment. The Williams point out that Lowry J. in Sutherland v. Langley (Township) (1997), 61 L.C.R. 242 (B.C.S.C.) stated at para. 8 of his decision:

...given the wording of section 3 of the Expropriation Act, I do not consider that it can be said there has been an "expropriation" of any kind. The section provides for the transfer of land without expropriation. (emphasis in original)

[11] The Williams say that a number of other provisions lend support to their position that the legislature distinguished between an expropriation and a section 3 agreement and thus did not mean section 25 to apply to compensation claims under section 3 agreements. In section 3(1)(b) of the Act, the direction to the board to determine the compensation "as if the land had been expropriated", implies that a section 3 agreement is not an expropriation. In section 20 of the Act, the provision for advance payments to be made in three different circumstances, one of which is after approval of an expropriation by the expropriating authority under section 18, and another of which is after a section 3 agreement, indicates that a section 3 agreement is to be treated as distinct from an expropriation. Similarly, section 26 of the Act sets out four circumstances in which the board must determine compensation, one of which is after an expropriation under sections 30 or 40 and another of which is if there is a section 3 agreement.

[12] The Williams point to section 26(1)(a) which provides that the board is to determine "compensation to be paid in respect of every agreement under section 3(1)" (emphasis added). Similarly, the particular section 3 agreement into which the parties entered states that the compensation "shall be determined by the Expropriation Compensation Board" (emphasis added). This provision in the contract is in compliance with section 3(2)(b) which says that the agreement "must state... that compensation must be determined by the board" (emphasis added). They submit that such imperatives would not be used if the legislature intended the limitation period in section 25 to apply.

[13] The Williams also say that, since limitation provisions in statutes are restrictive and circumscribe the rights of action of citizens, they should be strictly interpreted. If there is any ambiguity, it is to be resolved in favour of the claimant. See Orden Estate v. Grail, [1998] 3 S.C.R. 437 at para. 136.

[14] Additionally, in the Williams' submission, since section 3 agreements are helpful to expropriating authorities, allowing them to commence work on the required property without the formalities required by an expropriation, there is no need to oblige the owners who transferred the land to apply for determination within a time limit.

[15] The claimants ask the board to reconsider an earlier decision of the board in Hansen v. British Columbia (Minister of Transportation and Highways) (1998), 65 L.C.R. 127, aff'd (2000), 70 L.C.R. 1 (B.C.C.A.). In Hansen one issue was similarly whether the limitation period in section 25 applied in a situation where the parties had transferred land with a section 3 agreement rather than an expropriation. The board ultimately determined that the expropriating authority was estopped from relying on the limitation period in section 25 because of the specific behaviour of the parties in that case. However, the board rejected the owners' alternative argument that section 25 limitation periods did not apply to section 3 agreements. The Court of Appeal in Hansen upheld the board's decision on estoppel. Its only observation with respect to the board's interpretation of section 25 was that the board was correct in deciding that section 25 barred a remedy, rather than extinguishing a right. In this case, unlike the owners in Hansen, the Williams are not relying on estoppel.

[16] With respect to the Court of Appeal decision in Golden Valley, the claimants emphasize the reasons of Madam Justice Newbury. The issue in this case was whether the board had jurisdiction to deny a notice of discontinuance filed by the owner. The board had concluded that it did have jurisdiction and that, in the particular circumstances of the case, fairness and justice estopped the owner from discontinuing the claim. Thus, the board refused to accept the notice of discontinuance. The Court of Appeal upheld the board's decision on this substantive issue, although the majority allowed the appeal on other grounds. In the course of her reasons, Madam Justice Newbury interpreted section 3 as requiring the board to determine compensation with respect to land that had been transferred pursuant to section 3 in every instance. At para. 27 she observed that "[t]his requirement is not stated to be subject to any condition or modification, either in the statute or in the agreement under consideration here." The claimants in this case say that this statement implies that Madam Justice Newbury was not of the opinion that section 25 constituted a limitation on the requirement for the board to determine compensation. Further, in finding that the claimant was estopped from discontinuing the claim, Madam Justice Newbury observed that the actual agreement (in compliance with section 3(1)(b)) specifically provided that "compensation for the transfer of the said lands shall be determined by the Expropriation Compensation Board". (Emphasis in the original)

4.  THE MINISTRY'S POSITION

[17] The Ministry emphasizes the plain meaning of section 25. Unlike Orden Estate, where there were two different limitation periods in the governing statute, in this case the Ministry says the limitation period in section 25 offers no ambiguity requiring resolution. The limitation period is "within one year after payment is made under section 20". According to the Ministry, this advance payment under section 20 applies equally to transfers of land by section 3 agreements and to transfers of land by expropriation.

[18] The Ministry submits two arguments for section 25 applying to section 3 agreements even though there is no specific reference to section 3 agreements in that section. First, section 3(1)(a) provides that "Part 2 to 4, other than section 20, do not apply" to section 3 agreements. Part 2 contains provisions for "Approval", Part 3 for "Pre-expropriation Procedures", and Part 4 for "Expropriation". By the principle of statutory interpretation known as "expressio unius est exclusio alterius", or the expression of one thing is the exclusion of another, it argues that Part 5 headed "Compensation Procedures" must be treated as fully applicable. Since section 25 is found in Part 5, it must be intended to apply.

[19] Second, section 3(1)(b) provides that the board must determine compensation "as if the land had been expropriated under this Act". Not surprisingly, the Ministry relies upon the board's decision in Hansen, rejecting the claimant's argument that section 25 limitation periods do not apply to section 3 agreements. In Hansen the board stated that the intent of section 3(1)(b) is that the board must determine compensation for section 3 agreements in the same manner and on the same basis that compensation is determined for land which has been expropriated. Thus, references to owners of expropriated land in Part 5 ("Compensation Procedures") and Part 6 ("Basis for Compensation") of the Act include owners whose land has been transferred as a result of a section 3 agreement, even though such owners are not separately mentioned. The use of the words "whose land was expropriated" in section 25, which is included under Part 5 of the Act, is no more significant than other similar references throughout Parts 5 and 6 of the Act. The Ministry argues that Hansen was correct and should be followed.

[20] The Ministry also refers to two other decisions of the board, Rogers v. British Columbia (Minister of Transportation and Highways) (1995), 58 L.C.R. 141, and Haughton v. Heffley Creek (Waterworks District) (1999), 66 L.C.R. 1, as authority for the proposition that the board has no discretion to vary the limitation period in section 25. It agrees that in certain circumstances an expropriating authority could be found to have waived the limitation, or be estopped from relying on it as in Hansen, but points out that those issues were not raised in this hearing.

[21] The Ministry asks the board to distinguish the Supreme Court's decision in Sutherland as appropriate to a different context. The issue in that case was whether a property was deemed to be in conformity with municipal zoning bylaws after some of the property had been granted away through a section 3 agreement. Had part of the property been "expropriated", leaving the balance of the property in apparent breach of a setback provision, section 912 of the Municipal Act would have provided that deemed conformity. However, the municipality succeeded in persuading the court that the owner who entered a section 3 agreement had not been expropriated, and so the remaining land was non-conforming. The case obviously did not deal with the precise issue in the present proceeding, namely the relationship between section 3 and section 25 of the Act. In Hansen the board, faced with the same issue, had found that Sutherland was not of assistance.

[22] The Ministry suggests that the following principles can be discerned from the judgments of Madam Justice Newbury and Madam Justice Rowles in the Court of Appeal's decision in Golden Valley:

• section 3 agreements are not irrevocable offers to settle; rather they are agreements between two parties, that cannot be amended without the consent of both parties; typically that consent would be evinced by way of a settlement between the parties; and
   
• when a section 3 agreement has been entered into, and a claimant has filed an application for determination of compensation within one year of the advance payment, the board must determine the compensation in that case, unless the parties agree otherwise by way of settlement.

[23] The Ministry says that implicit in these findings is that it was the claimants' responsibility to assert their claim by filing an application in accordance with the Act and regulations. Since the claimants did not file a claim within the time prescribed, they are deemed to have accepted the advance payment.

[24] The Ministry also notes that Madam Justice Rowles adopts Hansen and expressly states that the section 25 limitation applies to section 3 agreements. Although this statement might be obiter, the Ministry says that it has strong persuasive authority.

5.  DISCUSSION

[25] We agree with the claimant that section 3 agreements are not expropriations. One of the requirements under section 3(2) of such an agreement is that the owner consents to the transfer of land, while the definition of expropriation in section 1 says that it a taking of land without the consent of the owner. Indeed section 3(1) provides that these are agreements where the owner agrees to transfer the land "without expropriation". This distinction between section 3 agreements and expropriations is the same as that made by Lowry J. in Sutherland. However, it does not necessarily follow that section 25 does not apply to owners who have entered into section 3 agreements rather than having been expropriated.

[26] One of the primary rules of statutory interpretation is that the Act must be read as a whole. Reading the whole of the Act, particularly sections 3, 20, and 25, together with other references to land that is expropriated in other sections of the Act, brings us to a similar conclusion as the board in Hansen. When parties have entered into section 3 agreements, they have agreed to omit the formal technical procedures for an expropriation spelled out in Part 2 ("Approval"), Part 3 ("Pre-expropriation Procedures"), and Part 4 ("Expropriation"), except for the advance payment provision in section 20, which is in Part 4. However, the board is to determine compensation for land that is the subject of a section 3 agreement in the same manner and on the same basis as for land that has been expropriated. Other parts of the Act having to do with compensation and appeals of compensation decisions apply to section 3 agreements.

[27] The meaning of the phrase "as if the land had been expropriated under this Act" in section 3(1)(b) is that the board is to treat section 3 agreements in the same way as expropriations when it is determining compensation. Throughout Part 5 of the Act, entitled "Compensation Procedures", and Part 6, entitled "Basis for Compensation", there are many references to land that has been expropriated. These compensation provisions include land that has been transferred as a result of a section 3 agreement, even though section 3 agreements are not specifically mentioned. Thus we do not see the use of the words "an owner whose land was expropriated" in section 25, which is included in Part 5 of the Act, as excluding owners whose land was subject to a section 3 agreement. Similarly to the many other occurrences of "expropriated land" in Parts 5 and 6, in our view the phrase in section 25 includes land that was transferred by a section 3 agreement. We see no reason to disagree with what this board said in Hansen.

[28] The Williams point out the mandatory nature of two different provisions:

• the use of the word "every" in section 26(1)(a) which provides that the board is to determine "compensation to be paid in respect of every agreement under section 3(1)" (emphasis added); and
   
• the language of section 3(2)(b) which states that "compensation must be determined by the board" (emphasis added).

They suggest that the legislature would not have used these phrases if it anticipated that the limitation period in section 25 applied to section 3 agreements.

[29] However, we also note that sections 30 and 31 of the Act provide as follows:

30 (1) Every owner of land that is expropriated is entitled to compensation, to be determined in accordance with this Act. (emphasis added)

31 (1) The board must award as compensation to an owner the market value of the owner's estate or interest in the expropriated land plus reasonable damages for disturbance ...(emphasis added)

Notwithstanding the use of the word "every" and "must", any owner of land that is expropriated who seeks compensation in addition to the advance payment must initiate an application by making a claim for compensation to the board. The procedure for filling in and filing this application or Form A is set out in section 2 of the board's Practice and Procedure Regulation, B.C. Reg. 452/87. Section 25 of the Act requires that this application by Form A be made to the board within one year of the advance payment or the owner is deemed to have accepted that payment in full settlement. The board does not award compensation to those owners whose land was expropriated who do not file a Form A or who do not file a Form A within the specified limitation period (except in the circumstances of waiver or estoppel) despite the imperatives in sections 30(1) and 31(1). An owner whose land has been transferred as a result of a section 3 agreement must similarly file a Form A with the board to initiate his or her claim with the board. The board will not award compensation to those owners with section 3 agreements who do not file a Form A or who do not file a Form A within the specified limitation period (except in the circumstances of waiver or estoppel) despite the imperatives in sections 26(1)(a) and 3(2)(b).

[30] We agree with the Ministry that, in reviewing the Court of Appeal decision in Golden Valley, there are some common principles to be discerned in the reasons of Madam Justice Newbury and Madam Justice Rowles. The first common principle is that section 3 agreements are not irrevocable offers to settle but rather agreements between the parties that cannot be amended without consent of both parties. Madam Justice Newbury's emphasis on the mandatory wording in section 26(1)(a) and 3(2)(b) is only in relation to Golden Valley's submission that a section 3 agreement was a statutory offer to settle from which it could unilaterally withdraw. She did not consider these words in relation to section 25. Madam Justice Rowles did consider these words in relation to section 25 and found that section 25 applied to section 3 agreements. The second common principle is that, when section 3 agreements have been made and the claimant has brought the matter to the board by filing a Form A within the limitation period set out in section 25, the board must determine compensation unless the parties agree otherwise by settling the matter. See paras 27-30, 70 and 78 of the Golden Valley decision.

[31] Thus we conclude that section 25 of the Act applies to compensation claims that follow a section 3 agreement. The Williams' Form A application, having been filed out of time, is thereby barred by the operation of section 25 and their application for a determination to the contrary is accordingly denied.