October 31, 2005, E.C.B. No. 33/92/263

REASONS FOR DECISION

1.  INTRODUCTION

[1]  The claimant, Rainbow Country Estates Ltd. (Rainbow), was the registered owner of three lots totalling 43.7 hectares (108 acres) in the Municipality of Whistler. During July and August, 1987 the respondent, the Resort Municipality of Whistler (Whistler), took various procedural steps in order to expropriate these three lots (the subject property). The Notice of Expropriation was served on the claimant on August 31, 1987. We note that this was a few months before December 1987 when the Expropriation Act, S.B.C. 1987, c.23 (the Act) came into force.

[2]  Rainbow has brought an application asking the Board for an Order that the date of expropriation for the purposes of compensation is February 27, 1991, the date that Whistler made an advance payment into court in compliance with an Order of this board. In the alternative Rainbow asked for an Order that the date of expropriation was October 2, 1990, the date Whistler applied to be registered as owner of the subject property. Whistler says that the date of the expropriation was August 31, 1987 and that this issue is res judicata as a result of various decisions by the British Columbia Supreme Court and the British Columbia Court of Appeal.

[3]  This application was heard in Vancouver on April 29, 2005. There were lengthy Affidavits from Andrew Saxton Jr. for the claimant and from Bill Barratt, Melissa Laidlaw and Allison Baker for the respondent. All of these Affidavits had numerous exhibits including documents from court files in three different proceedings between the parties. I also received a binder of court proceedings. At the conclusion of the hearing counsel requested that I delay rendering a decision on this matter pending discussion of collateral issues between the parties. On August 29 and September 21, 2005, counsel requested that I proceed with the determination of the preliminary issue as to whether the determination of the date of expropriation was res judicata.

2.  BACKGROUND

[4]  The expropriation of the subject lands has had a lengthy history. The chronology of relevant events in this case derived from the Affidavit evidence and the volume of court proceedings is as follows:

3.  ISSUE

[5]  The issue is whether the date of the expropriation is res judicata as a result of the various Orders made between the parties by the British Columbia Supreme Court and the British Columbia Court of Appeal.

4.  RAINBOW'S POSITION

[6]  Under the Expropriation Act that came into force on December 24, 1987, the expropriating authority is required under section [20] of the Act to make an advance payment to the property owner and to supply an independent appraisal report on which the payment is based within 30 days after the expropriation is approved. This provision of an advance payment based on an independent appraisal which did not foreclose a claimant from continuing to pursue further compensation was a new feature in the Act to enhance fairness for claimants whose land has been taken against their will. Within thirty days after this advance payment has been made, section [23] of the Act stipulates that the expropriating authority must file the vesting notice in the land title office. The date that this vesting notice is filed is defined in section [29] of the Act to be the date of expropriation (which is used as the relevant date for the determination of compensation ). Rainbow says that as a result of these provisions the date of expropriation should either be February 27, 1991, the date Whistler made an advance payment into court pursuant to the Order made by this board, or October 2, 1990, the date that Whistler applied to become registered owner of the subject property.

[7]  Rainbow has two main arguments. First it says that this issue, the date of expropriation for the determination of compensation, has never been determined in any of the prior court proceedings. Rainbow says the issue of the date of expropriation was excluded from the initial court proceedings before Bouck J. in October 1989. Review of the Rainbow's Petition and Counsel's Memorandum of Reasons for Bouck J's Order indicate that there was no consideration of the date of expropriation or any of the provisions of the Act that were relevant to that determination. The issues that were argued were to do with the authority of the solicitor to make a settlement, whether a settlement had been made and whether there were any general contract principles that negated this particular Settlement Agreement. This means that the doctrine of issue estoppel does not apply.

[8]  Further, it was unnecessary in any of the other court proceedings to decide the issue of the date of expropriation. Review of Whistler's Writ of Summons, Allan L.J.S.C.'s Reasons, Court of Appeal's Reasons with respect to the Appeal of the Orders of Bouck J. and Allan L.J.S.C., Rainbow's Writ of Summons, and Orders made by this Board all show different issues either to do with the validity of the Settlement Agreement and the performance of certain aspects of the Settlement Agreement including Whistler acquiring title to the subject property and the advance payment being paid into court. This also means issue estoppel does not arise.

[9]  Rainbow cites Doctrine of Res Judicata in Canada, 2nd ed., Donald J. Lange, ( Toronto, Butterworths. 2004) which states at p 39:

The same question test is the focal point for the doctrine of issue estoppel. The traditional view of issue estoppel is that the same question has been decided, that is, actually decided, in the first proceeding.

And at page 42:

In addition to the requirement that the question be actually decided, the question in the first proceeding must have been fundamental to the decision for the purpose for issue estoppel. A finding that is collateral or incidental is not essential to the decision.

[10]  Second Rainbow says that even if all the preconditions for issue estoppel did exist, the test in public law litigation is somewhat different. Tribunals are created by statute to carry out statutory obligations. "Important objects of public law are not to be thwarted by the application of the judge made law on res judicata, as if the parties were litigating a dispute found in private law." See Withler v. Canada (Attorney General), 2002 BCSC 820 at para 42. This board as a matter of public policy, has a discretion to decide whether issue estoppel should apply in the circumstances of this case. See Danyluk v. Ainsworth Technologies Inc., [2001] 2 S.C.R. 460.

[11]  Rainbow says the passing of the Expropriation Act in 1987 was important in providing fair procedures and just compensation for property owners whose property was taken from them for public purposes. It quotes from Hansard and comments made by the then Attorney General, the Honourable B.R. Smith, during introduction and second reading of the new expropriation legislation in Bill 22 in the spring of 1987. He said that under the new legislation property owners will be assured of fair and equitable treatment and the scales of bureaucratic justice will be tipped so that they are more balanced than in the past. The Expropriation Act has provisions setting out what should be the date of compensation. Whistler wishes to have the land valued at a date that is several years prior to when an advance payment was made or Whistler took formal possession of the subject property through a vesting notice. The Expropriation Compensation Board should be able to interpret these provisions given the facts in this case and it would be unfair to permit Whistler to avoid these provisions on the basis of res judicata.

[12]  Rainbow makes a third argument that any Agreement cannot be in contravention of the relevant legislative procedure, and refers me to British Columbia Telephone Co. v. Shaw Cable Systems (B.C.) Ltd., [1995] 2 S.C.R. 739.

5.  WHISTLER'S POSITION

[13]  Whistler says that the Settlement Agreement expressly provided for a mixture of procedure under various acts including the new Expropriation Act. An advance payment would be made as contemplated under the Expropriation Act though there was no requirement to do so. Rainbow would transfer the lands to Whistler by a Form 23 Transfer, not by a Vesting Notice as contemplated under the Expropriation Act. The date of taking for all purposes was fixed as August 31, 1987, the date that the Expropriation Notice had been served on the claimant not the date that a Vesting Notice was filed as contemplated in the Expropriation Act.

[14]  There were numerous proceedings to enforce this Settlement Agreement. Both Bouck J. and Allan L.J.S.C. held that the Settlement Agreement was valid and pursuant to this Agreement the Registrar of the Vancouver Land Title Office was to register title to the subject property in the name of Whistler. The Court of Appeal on September 21, 1990 dismissed the appeals against these two orders after considering Rainbow's arguments that some of the provisions of the new Expropriation Act were bypassed in the Settlement Agreement. Whistler referred me to Rainbow's Factum to the Court of Appeal with respect to the Appeal of the Order of Bouck J. in which there was an express reference to the fact that the Settlement Agreement was unfair to the claimant in establishing a valuation date that was earlier than one under the provisions of the new Expropriation Act. The Court found it open to the parties to agree to bypass some of the Act's requirements and that this was in fact what they had done.

[15]  In the subsequent proceedings before Thackray J. in 1993 and Edwards J. in 1994, both judges held that all matters related to the Settlement Agreement were res judicata. Whistler says that in this case the date for determining compensation is set out clearly as an express term in the Settlement Agreement and cannot be relitigated before this board.

6.  ANALYSIS AND CONCLUSION

[16]  In Danyluk, Binnie J., speaking for the Court, sets out the public policy considerations behind the doctrine of issue estoppel at p 473:

The law rightly seeks a finality to litigation. To advance that objective, it requires litigants to put their best foot forward to establish the truth of the allegations when first called upon to do so. A litigant, to use the vernacular, is only entitled to one bite at the cherry. … An issue, once decided, should not generally be re-litigated to the benefit of the losing party and the harassment of the winner. A person should only be vexed once in the same cause. Duplicative litigation, potential inconsistent results, undue costs, and inconclusive proceedings are to be avoided.

[17]  At p. 477 he sets out the requirements for issue estoppel quoting from Dickson J. in Angle v. Minister of National Revenue, [1975] 2 S.C.R. 248. They are:

1. that the same question has been decided;
2. that the judicial decision which is said to create the estoppel was final; and
3. that the parties to the judicial decision … were the same persons as the parties to the proceedings in which the estoppel is raised.

In this case there is no difficulty with the last two requirements; the only issue is whether the question in this proceeding as to the date of the expropriation is the same question as was decided in the earlier court decision(s).

[18]  Binnie J. paraphrases Dickson J.'s test set out in Angle with respect to the same question being asked as follows (at p 476):

The question out of which the estoppel is said to arise must have been "fundamental to the decision arrived at" in the earlier proceedings. In other words ... the estoppel extends to the material facts and the conclusions of law or of mixed fact and law ("the questions") that were necessarily (even if not explicitly) determined in the earlier proceedings.

This test is broader than earlier tests that had emphasized the same question being directly in issue or expressly implied. See 574095 Alberta Ltd. v Hamilton Brothers Exploration Co., [2003] 4 W.W.R. 417 (Alta C.A.) at p 428.

[19]  The claimant has vigorously submitted that the date of the expropriation is a new question that has never been raised in any of the prior judicial decisions. However, I agree with Whistler that the date of expropriation was expressly set out in the Settlement Agreement that was definitively upheld in the decisions by Bouck J., Allan L.J.S.C., and the Court of Appeal. In finding that a Settlement Agreement had been made, Bouck J. was also finding that each of the terms of the Settlement Agreement had been agreed. Thus, as a result of a term in the Settlement Agreement Bouck J. dismissed Rainbow's Petition seeking to challenge the expropriation bylaw. In her written reasons Allan L.J.S.C. states that Whistler's action for specific performance is "simply one to enforce the Agreement which has already been determined by Bouck J. to be a valid [S]ettlement [A]greement" (see p 4 of the decision, line 20). She goes on to find that Whistler is "entitled to judgment to enforce the Agreement which has been found to be valid in the earlier proceedings" (p. 5, line 25). Therefore, as a result of a term in the Settlement Agreement found valid by Bouck J., Allan L.J.S.C. ordered specific performance with the Registrar of the Land Title Office registering Whistler as the owner of the subject property. Further, pursuant to express terms in the Settlement Agreement, this board made an Order as to how the advance payment set out in the Settlement Agreement was to be paid. The date of expropriation is yet another express term included in the Settlement Agreement:

Rainbow … irrevocably agrees that the effective date of taking, service of notice of expropriation, vesting and possession for all purposes including valuation, determination of compensation and advance payment of costs is August 31, 1987.

I find that the date of expropriation is a question necessarily (even if not explicitly) determined in the earlier proceedings by Bouck J. As a result I conclude that the requirements of issue estoppel are met.

[20]  Rainbow made a second argument that in any event, under Danyluk, I had a discretion as to whether issue estoppel should apply on the facts of this case. In Danyluk, an employee was in dispute with her employer as to unpaid commissions claimed in the amount of $300,000. The employee filed a complaint under the Employment Standards Act seeking unpaid wages including commissions. The employee also brought a court action for wrongful dismissal. An employment standards officer spoke with the two parties separately and did not inform the employee of the employer's submissions on the issue of commissions. As a consequence the employee had no opportunity to answer the employer's submissions. The employment standards officer rejected the employee's claim for commissions and ordered the employer to pay about $2,350, representing two weeks wages in lieu of notice. The employment standards officer told the employee of this decision 10 days after telling the employer. In the court proceedings the employer applied to strike the claim for wages on the grounds that the employment standards officer had already decided this question and issue estoppel applied. The chambers judge granted the employer's application and struck the pleadings claiming wages. The Ontario Court of Appeal upheld this decision. The Supreme Court of Canada allowed the employee's appeal. The Court said that issue estoppel is a public policy doctrine designed to advance the interests of justice. In this case where issue estoppel would bar a claim because of an administrative decision made in a manifestly improper and unfair manner, a re-examination of some basic principles was warranted. The relevant factors included the wording of the statute, the purpose of the statute, the safeguards available to the parties in the first decision, the expertise of the administrative decision maker and the potential injustice. After a consideration of these factors the Court refused to apply issue estoppel and allowed the employee's appeal.

[21]  find that the facts in Danyluk can be distinguished. There is no suggestion that the earlier judicial decisions in this case were made in an improper and unfair manner. Nor is there any suggestion that the expertise of the initial decision maker is in question. Indeed, such a suggestion would be presumptuous. Rainbow had the safeguard of being represented by experienced counsel in the initial decisions by Bouck J. and Allan L.J.S.C. that are the basis for the claim that this issue is res judicata. (Ms. Saxton represented Rainbow herself in some of the subsequent proceedings).

[22]  Rainbow's primary submission in relation to Danyluk and Withler is that the public policy principles in the Expropriation Act should not be barred by the application of issue estoppel. The central unfairness alleged by Rainbow is that the possible dates for determining compensation suggested by the Expropriation Act (February 27, 1991 or October 2, 1990) would be long after the date of valuation set out in the Settlement Agreement of August 31, 1987. It is implied that these much later dates are part of the procedure in the Expropriation Act which enhances justice for property owners. But this is not the case. The reason for the delay of the advance payment and the vesting of the title to Whistler is the protracted litigation brought by the claimant. While Rainbow had the right to contest the Settlement Agreement, one of the consequences of this course of action is that both of these events were considerably delayed. Under the terms of the Settlement Agreement the advance payment and the vesting would have occurred much sooner, in the spring of 1988, but for the claimant's rejection of the Agreement.

[23]  The Expropriation Act links the date of expropriation to the date of vesting or the date when the authority takes formal possession of the property. In this case, while the filing of the vesting order was delayed, there were other indicia of Whistler taking possession of the property on the date set out in the Settlement Agreement. While the claimant would prefer a later valuation date, it is not necessarily unfair that the valuation date occurs before the date of vesting or the advance payment in the circumstances of an expropriation that predated the Act. See Whitechapel v. British Columbia (Minister of Transportation and Highways) (1994), 54 L.C.R. 306 where this board found that it did not have jurisdiction to order that the respondent produce and provide an appraisal report under section [20] of the Act when the expropriation occurred before the Act had been proclaimed. I note that in Whitechapel, an advance payment was also made several years after the date of expropriation when the authority had taken possession of the subject property under the operative procedures that predated the Act. There is nothing in the Act that as a matter of policy would have provided Rainbow with a substantially later valuation date in the circumstances of this case. Unlike Danyluk and Withler, I do not find that there is any potential injustice to the claimant if issue estoppel applies and the date of expropriation is as set out in the Settlement Agreement. I also do not find that British Columbia Telephone Co. has any relevance to this case.

[24]  I note that Rainbow's solicitor made essentially the same argument in his Factum to the Court of Appeal in 1990 that is being advanced in this hearing – Rainbow was unfairly deprived of some of the provisions in the Expropriation Act, including the date of expropriation, if the Settlement Agreement was upheld. The Court of Appeal rejected that submission and found that the parties had agreed to adopt some of the provisions of the new legislation and not others.

[25]  Finally, I underline the comments of Binnie J. in Danyluk on the desirability of finality in litigation. "A person should only be vexed once in the same cause". There is certainly a need for finality in the circumstances of this case.

7.  CONCLUSION

[26]  I find that issue estoppel applies and the date of expropriation and valuation is August 31, 1987 as set out as a term of the Settlement Agreement. The date of expropriation cannot be relitigated by this board.

EXPROPRIATION COMPENSATION BOARD

______________________________________

Sharon I. Walls

Vice Chair