Significant Decision Regarding Section 245 of the AUPA: Superior Court Rules Once Again in Favour of Sommet Prestige Canada Inc. and Propriétés Sommet Prestige Inc

De Grandpré Chait is proud to have represented, with a team composed of Marie-Pier Leroux, Jean-Daniel Lamy and Jonathan Fecteau, Sommet Prestige Canada Inc. and Propriétés Sommet Prestige Inc. in a matter that resulted in a significant Superior Court decision regarding the application of section 245 of the Act respecting land use planning and development (AUPA).

The Superior Court concluded that our clients’ properties were subject to de facto expropriation and awarded them total compensation of more than $7.5 million, plus interest and additional indemnity from March 2018, when the expropriating regulatory provisions came into force.

This is one of the first decisions to interpret and apply the new section 245 of the Act respecting land use planning and development (AUPA), particularly with respect to the concept of a natural environment having “significant ecological value” (SEV).

The judgment establishes important principles, including the following:

• The burden of establishing that a property has SEV clearly rests with the public body seeking to rely on the exception provided for under section 245 of the AUPA;
• The assessment of SEV must take into account the current state of the natural environment and cannot be artificially frozen as of the date of the decision that resulted in the expropriation;
• Not every ecological value constitutes SEV;
• Section 245 of the AUPA must be interpreted so as to ensure that only natural environments that genuinely have SEV may justify denying compensation to an expropriated owner, and must be given a broad and liberal interpretation in favour of the fundamental right to property;
• Section 245 of the AUPA does not eliminate the right to compensation: only the specific circumstances provided for by the legislature may justify depriving an owner of the use of their property without compensation.

The Court reiterates a fundamental limit on the regulatory powers of public bodies: however legitimate the objectives of protecting natural environments may be, their implementation cannot result in a single landowner bearing the entire cost of what amounts to a true expropriation, except in the circumstances expressly provided for by law.

This highly significant decision in the area of de facto expropriation represents a concrete and meaningful victory for property owners whose rights are affected by excessively restrictive regulations. The Superior Court once again confirms that, where de facto expropriation occurs, the right to fair compensation remains the rule, not the exception.

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