Sturgeon Hotel Ltd. v. St. Albert (City), 2010 ABQB 725

Court of Queen ’ s Bench of Alberta Citation: Sturgeon Hotel Ltd. v. St. Albert (City), 2010 ABQB 725 Date: 20101122 Docket: 1003 11818 Registry: Edmonton Between: Sturgeon Hotel Ltd., a Corporation Duly Registered In the Province of Alberta, Operating As the St. Albert Inn & Suites Applicant - and - The City of St. Albert Respondent _______________________________________________________ Reasons for Judgment of the Honourable Mr.

Justice Donald Lee _______________________________________________________ Introduction [ 1 ] At the centre of this dispute is a Reciprocal Parking Agreement, (the “Parking Agreement”) that was entered into on December 28, 2000 by the City of St. Albert (the “City”) and Sturgeon Hotel Ltd., operating as the St. Albert Inn & Suites (the “Hotel”). The City operates a transit station with Park and Ride service on property located adjacent to land owned by the Hotel (the “City Lands”).

The Parking Agreement provides a non-exclusive licence to the City to permit its transit patrons to use part of the parking area on the land owned by the Hotel (the “Hotel Lands”) for overflow parking during weekday business hours. Pursuant to the Parking Agreement, the City registered a Caveat on April 30, 2001 against title to the Hotel Lands.

[ 2 ] Since around 2001 and, markedly since 2007, transit ridership and the use of the Park and Ride services offered by the City at the City Lands have increased. As a result, the parking stalls on the Hotel Lands are often completely occupied during weekday business hours during the months of September to early December and January to April. [ 3 ] The Hotel’s position is that the Caveat should be discharged as the City’s rights under the Parking Agreement do not protect an interest that properly runs with the land or, in the alternative, the Caveat should be discharged pursuant to

Section 48 of the Land Titles Act , R.S.A. 2000, c. L-4 (the “Act”). Until such discharge, the Hotel requests a grant of exclusive use to, at a minimum, half of the parking stalls in the area identified in

Schedule “A” to the Caveat to give effect to the intention that the licence was for non-exclusive and shared use of the parking area. [ 4 ] The Hotel relies in support of it’s application

Part 1 of the Judicature Act , R.S.A. 2000, c. J-2, s. 4 and 11 , s. 48 , s. 141, s. 146 of the Land Titles Act ,

Part 33 of the Alberta Rules of Court , A.R. 390/68, Rules 1.3, 3.8 – 3.14 and 15.6 of the Alberta Rules of Court , A.R. 124/2010. [ 5 ] In 2000, in order to facilitate the location of a Park and Ride transit station, the City purchased property from the Hotel that was adjacent to the Hotel (the “City Purchased Property”). Clause 2(

d) of the Real Estate Purchase Contract between the Hotel and the City provided that:– On or before December 5, 2000 the Parties sign a mutual access and reciprocal parking agreement, to ensure vehicular access, parking (excluding commercial vehicles) and future use of roads by both Parties to the Property and Vendor’s remaining lands. [ 6 ] Following an extension of the December 5, 2000 date, the Parking Agreement was executed. Relevant clauses of the Parking Agreement are set out below:– 5.

Sturgeon grants to the City a non-exclusive licence to use the Hotel Lands as an overflow parking area for its weekday transit service “Park and Ride” patrons. 7. The City grants to Sturgeon a non-exclusive licence to use the City Lands as an overflow parking area for its hotel patrons on evenings and weekends. 9. The City agrees that the parking space provided to Sturgeon pursuant to this agreement is intended to constitute

Section 44 off-site parking for the purpose of fulfilling Land Use By-law No. 18/94 parking requirements. 17. The rights herein conferred shall constitute an interest in land by way of an easement running with the lands and shall bind the successors, assignees and transferees of the City and the (sic) Sturgeon respectively. Either party shall be permitted to register a caveat against the other’s lands protecting the rights herein granted.

Upon the termination of this agreement, the parties shall immediately, at their own costs, discharge any caveat so registered. [ 7 ] It is common ground that between 2001 and around the end of 2005, shared parking created few difficulties or hardships for the Hotel. However beginning in and around 2006, the success of, if any, the City’s Park and Ride program at the Village Landing Transit Station and, in particular, its involvement in the U-Pass program beginning in 2007, resulted in two issues: (

i) illegal parking on the properties adjoining or adjacent to the Village Landing Transit Station (not at issue in this application); and (ii) the full occupation of the parking stalls on the Hotel Lands by Park and Ride patrons during certain hours throughout the week, particularly during the months that Post-Secondary institutions were in session. The City, the Hotel and other affected parties acknowledged these issues and starting in 2006 met from time to time to attempt to resolve these matters. To date, no satisfactory resolution has been achieved. [ 8 ] The complete occupation of the stalls on the Hotel Lands creates two issues for the Hotel. Firstly, it means that these stalls

are often unavailable for patrons of the Hotel who might arrive at the Hotel between 8:00 a.m. and 4:00 p.m. during the week to check into the Hotel, attend an event, or go to the restaurant in the Hotel. Secondly, it means that for approximately half the year, these stalls are unavailable to the Hotel to meet it’s parking requirements under

Part 7, s. 7.3 of the City of St. Albert Land Use Bylaw, 9/2005, consolidated by Bylaw 25/2009 (the “Land Use Bylaw”) and pursuant to its development permit from 2006.

This is problematic because the Hotel has fewer, rather than more, parking stalls on its property than it actually requires for compliance with the Land Use Bylaw. [ 9 ] Since 2001, there have also been major changes to the business of the Hotel that have resulted in a reduction in weekend and evening use of the Hotel facilities. [ 10 ] In September of 2009, the Hotel began using barricades and caution tape to temporarily restrict the access of transit patrons to a portion of the parking spots on the Hotel Lands.

As a result on November 13, 2009, the Hotel received a letter from City which advised, inter alia , the following:– “The Agreement does not allow either the Hotel or the City to “save” or “reserve” parking spaces for the exclusive use of its patrons. I am particularly disturbed by the fact that the St. Albert Inn continues to act contrary to the terms of the Reciprocal Parking Agreement yet continues and must rely on that Agreement to continue its operations.

Planning staff have indicated to me that “but for” the Hotel’s Reciprocal Parking Agreement with the City the 2006 expansion of the Hotel would not have been approved by the Development Officer. Development Permit DP-2006-002093 requires that the Hotel provide 379 stalls for parking. Only 258 of these parking stalls are provided on the Hotel Lands. The remaining required parking stalls are accessible under the Reciprocal Parking Agreement.

When the Development Permit was under consideration you specifically brought the Reciprocal Parking Agreement to the attention of the Development Officer as the means by which the deficiency in parking stalls was to be addressed. Clearly the intent of the Hotel was to rely on the parking stalls provided under the Reciprocal Parking Agreement. It is not acceptable for the Hotel to continue to reply on the benefit of the Reciprocal Parking Agreement and yet be unwilling to “pay” for that benefit by allowing park and ride patrons to use the parking stalls on the Hotel Lands. . . .

At the City Council meeting on September 28, 2009, you urged City Council to offer an alternative park and ride location. Council did approve a trial park and ride service to run from the Akinsdale/Kinex Arena parking lot in an attempt to ease some of the parking challenges at the Village Transit Station. However, I would stress to you that the approval of this service does not mean that the City anticipates abandoning its rights under the Reciprocal Parking Agreement.

You need to be aware that the City is no longer prepared to sit back and allow the Hotel to ignore the obligations of the Reciprocal Parking Agreement when it is convenient for the Hotel to do so. Each time the Hotel acts in this manner up to 142 parking stalls are lost to transit park and ride patrons. The impact of the loss of parking stalls is felt directly by the transit users and then subsequently by surrounding businesses and residential areas as the transit users seek parking in other areas around the Village Transit Station. Other St.

Albert Transit partners, like Village Landing and the Christian Reformed Church, are negatively impacted by the selfish actions of the St. Albert Inn.” [ 11 ] Further attempts to resolve matters were unsuccessful and, on July 13, 2010 an Originating Notice of Motion was filed on behalf of the Hotel seeking an Order from this Court that:– (

a) The Caveat is hereby discharged because the condition or rights referred to therein do not constitute an interest that runs with, or is capable of being legally annexed to, land. (

b) In the alternative, for an Order pursuant to s. 48 of the Land Titles Act discharging the Caveat on the basis that the effect of the restrictive covenant or easement referred to therein is to restrict the availability of any parking stalls in the shared area from being available for use by patrons of the Hotel during the day as required by

Part 7, Parking Regulations of the Land Use Bylaw and the discharge of the Caveat is in the public interest because it makes it impossible for the Hotel to comply with the Land Use Bylaw and it is severely limiting the business opportunities and income of the Hotel.

(

c) In the further alternative, for an Order modifying the Caveat to permit the Hotel to discharge the Caveat no earlier than December 31, 2011 or upon four (4) months notice at any point in time after December 31, 2011. (

d) Further, the Hotel requests that the Order provide that the Hotel shall have exclusive access to, at a minimum, half of the stalls in the area identified in the Caveat to give effect to the intention that the license was for non-exclusive and shared use of the area identified in

Schedule “A” to the Caveat. Issues (

a) Does the Caveat protect an interest that runs with, or is capable of being legally annexed to, the land? (

b) If the answer to issue (

a) is No, should the Caveat be discharged because it is (

i) preventing the Hotel from being able to comply with its Development Permit and the Land Use Bylaw and/or (ii) is interfering substantially with the ownership interests of the Hotel in the Hotel Lands? (

c) If the answer to both issues (

a) and (

b) are No, should an Order be granted modifying the rights under the Caveat and the agreement to prevent the overuse of the parking stalls on the Hotel Lands? Analysis A. Does the Caveat Protect an Interest That Runs With, or Is Capable of Being Legally Annexed To, the Land? [ 12 ] The Hotel argues that the relevant clauses in the Parking Agreement are unclear as to whether the parking rights are contractual and create a mere licence, or are sufficient to create an easement.

Sections 5 and 7 of the Parking Agreement provide a non-exclusive licence to each of the Hotel and City to use the others lands as an overflow parking area, however Clause 17 of the Parking Agreement indicates the following:– 17. The rights herein conferred shall constitute an interest in land by way of an easement running with the lands... [ 13 ] The Hotel submits that despite the wording in Clause 17, the Parking Agreement is in the nature of a licence, and is not an easement which runs with the land.

Therefore, the Caveat should be discharged. [ 14 ] A licence creates a personal, contractual right between the licensor and licensee and is permission to do that which would otherwise constitute a trespass. Clause 5 of the Parking Agreement grants permission to both parties to park on the other’s lands; if such permission was lacking the parking would be a trespass. [ 15 ] The Newfoundland Court of Appeal provided an analysis of the impact of an agreement which provided parking rights in Imperial Oil Ltd. v.

Young (1998), 1998 CanLII 18026 (NL CA) , 167 Nfld. & P.E.I.R. 280 (C.A.) in which a written agreement allowed a tenant, Young, to continue to park on the lands of the landlord, Imperial Oil, after termination of the lease for those lands. When Imperial Oil terminated that parking arrangement, Young claimed the agreement provided a permanent and continuous right to park on the lands. The Newfoundland Court of Appeal looked at the wording of the agreement and found that the right to park was not an easement, was simply a licence to park on the lands owned by Imperial.

In determining that the contract provided for a licence, the Court stated at paragraph 40:–

There is no property right associated with it. Imperial does not have an interest in the vehicles parked and does not attempt to give Young any right in any land or chattel in addition to the parking privilege. [ 16 ] Although the Hotel acknowledges that the Parking Agreement in the present case contains a blanket reference to the rights in the agreement constituting an interest in land and an easement, the Hotel argues that one must still give effect to the granting clauses of the Parking Agreement, and they provide specifically that the grant is a “nonexclusive licence”.

This suggests that the intent of the parties was to allow for use of its lands by the other party, as opposed to altering the property rights associated with each of the parties’ respective lands. [ 17 ] Further, the Hotel submits that the requirements for an easement are not present in the Parking Agreement. The common law requirements for an easement are as follows:– (

a) There must be a dominant and servient tenement; (

b) The easement must accommodate the dominant tenement; (

c) The dominant and servient tenement owners must be different persons. However, this requirement has been eliminated in Alberta pursuant to section 68(1) of the Act ; (

d) The right granted must be capable of forming the subject-matter of the grant. 518002 Alberta Ltd. v. Edmonton (City) (1999), 1996 CanLII 10402 (AB KB) , 186 A.R. 263 (Q.B.) at paragraph 24 . [ 18 ] The Hotel submits that at issue in this application is requirement (d), whether the right granted is capable of forming the subject-matter of the grant. With respect to a test for this requirement, this Court’s decision in 518002 Alberta Ltd. v.

Edmonton (City) cites at paragraphs 43 and 44 the following passage from Professor Ziff in Principles of Property Law 4 th ed. (Toronto: Thomson Carswell, 2006) at 289 and 290:– The need for a grant stems from the treatment of easements as incorporeal: since a transfer of possession is not possible, a grant is required to pass ownership.

However, more is involved in the fourth element than this ... there must be a capable grantor and grantee; rights under an easement must not be too vague; the easement cannot be a mere right of recreation without benefit or utility; and (apart from fencing easements) it cannot require the servient owner to expend money. Furthermore, a valid easement cannot confer on the holder a right to possession of the servient lands to an extent that is inconsistent with the possessory rights of the servient owner . . . .

The requirement that easements be non-possessory raises concerns of both a theoretical and practical nature. ...One route out of the maze would be to reduce the inquiry to an assessment of whether the easement creates a substantial interference with the servient property and not to focus narrowly on possession per Se. (Emphasis added) [ 19 ] It is submitted that the statement by Professor Ziff follows the decision of our Court of Appeal in Shelf Holdings Ltd. v. Husky Oil Operations Ltd. (1998), 94 R. 241, citing A.J. McClean, The Nature of an Easement (1966), 5 W. L. Rev. 32 at 51.

In that case, the Court of Appeal affirmed that one question to be asked when determining if the rights under an easement are capable of forming the subject-matter of the grant is whether the grant is “inconsistent with the proprietorship or possession of the alleged servient owner”. The Court of Appeal adopted the following statement at paragraphs 17 and 34:– ... it follows from the general nature of the recognized interest in property that an easement cannot amount to a claim quite at variance

with the proprietary rights of the servient owner. On the other hand, it is also quite obvious that an easement does to some extent detract from those rights. ... The issue in fact is the perennial one of the drawing the line, of deciding when the point has been reached that the right in question detracts so substantially from the rights of the servient owner that it must be something other than an easement . (Emphasis added) [ 20 ] The issue in Shelf Holdings was whether a pipeline right-of-way contained all of the elements of an easement.

One determinative factor in the Court of Appeal’s decision that it did contain all of the elements of an easement was that the use of the servient tenement by the dominant tenement did not “deprive [the servient owner] completely of use of the surface of the right-of- way.” Although all conventional rights of way will interfere with the use of the land by the servient owner, it can be inferred from Shelf Holdings that the servient owner cannot be completely deprived of such use. [ 21 ] It is submitted that this issue of the extent to which the purported grant allows interference with the servient owner is an issue in this case.

Here the City has claimed that it is entitled to require the Hotel provide access to all the stalls on the Hotel Lands five days a week during business hours. Any attempt by the Hotel to reserve stalls for its customers on an intermittent and temporary basis has been alleged to be in contravention of the Parking Agreement. [ 22 ] The Hotel relies on 518002 , where the Court noted that “[a] point can be reached where what is claimed raises the grant above the status of an easement.

The grant could effectively be...a joint user of part of [the servient tenement].” Master Funduk found that the fact that an easement which took up 44% of a lot “made the lot of little or no value or use” and that the grant of easement claimed was “not reasonably necessary for the better enjoyment of [the servient tenement]...[it] sterilizes the possible use and the value of the lot.” The easement in 518002 provided a right-of-way over the servient tenement to allow access to the two dominant tenements. [ 23 ] In an English decision Batchelor v.

Marlow , [2001] EWCA Civ 1051, the test for whether a right to park can exist as an easement was held to be: “Does an exclusive right to park six cars for nine-and-a-half hours every day of the working week leave the appellant [servient owner] without any reasonable use of his land, whether for parking or anything else?” [ 24 ] In Batchelor , the Applicant had a right to park on the servient tenement lands from 8:30 to 6:00 p.m. on Monday to Friday. The issue was whether this was a right capable of being an easement.

The Court held that the parking rights granted to the Applicant ensured that the appellant had “no use at all during the whole of the time that parking space is likely to be needed” and that “[h]is right to use his land is curtailed altogether for intermittent periods throughout the week...mak[ing] his ownership of the land illusory.” [para. 18]. The Court accepted that this was not a right capable of being an easement. [ 25 ] However the ratio of this case has been questioned, although not overturned. In 2007, the House of Lords decided Moncrieff v.

Jamieson , [2007] UKHL 42 where the central issue was whether the right to park could be ancillary to a right of vehicular access, and whether a grant of access would also include a right to park on the access lands.

In dealing with this issue, Lord Scott summarized recent UK case law which dealt with parking easements, and outlined the “ouster” principle that parking rights which deprive a servient owner “any reasonable use of their land is “inconsistent with their ownership... and should not be recognised as servitudal rights in rem that can bind them and their successors in title.” [para. 54] [ 26 ] In Moncrieff , Lord Scott found that the test applied in Batchelor needed to be qualified as it is “impossible to assert that there would be no use that could be made by an owner of land over which he had granted parking rights.” [para. 59] Lord Scott noted other uses that the land could be put to, such as advertising or building above or under the parking area.

The opinion of Lord Scott was that an owner of land should be able to grant rights to any extent that they wish and, therefore if an area of land can accommodate 9 cars then the owner should be able to grant an easement to park 9 cars on the land.

Lord Scott summarized his opinion at paragraph 60 as follows:– I would, for my part, reject the test that asks whether the servient owner is left with any reasonable use of his land, and substitute it for a test which asks whether the servient owner retains possession and, subject to the reasonable exercise of the right in question, control of the servient land. [ 27 ] It is submitted that Batchelor confirms that where an owner is not able to make reasonable use of its property, the right will not be found to be a valid easement.

Specifically, in Batchelor , the easement to park was not valid because it caused a complete

occupation of the parking lot from 8:30 to 6:00, from Monday to Friday. Similarly, in this case the parking lot of the Hotel is completely occupied for half the year by transit riders during regular business hours during the week. Following the rationale outlined in Batchelor , the Hotel submits the ownership and control of the Hotel over the Hotel Lands is illusory due to the occupation of the parking spots by the City during the weekdays, making the lot useless to the Hotel when it is needed.

This is despite the fact it pays municipal taxes on the Hotel Lands and maintains the Hotel Lands. [ 28 ] Alternatively, applying the “ouster” principle and the reasoning of Lord Scott in Moncrieff , the Hotel submits the Court should look at whether the Hotel retains possession and control of their lands. Arguably the Hotel has retained possession, but has little control over who is parking in their lot during the week.

Attempts by the Hotel to block off a certain number of spots when they are needed during the day have been protested by the City. [ 29 ] Finally, the Hotel submits the benefit provided by the licence in the Parking Agreement benefits the City because it operates a Park and Ride facility at the Village Landing Transit Station. The licence is otherwise unnecessary to the use of that parcel of land. Parking is available on the City Lands however the City requires additional parking for the operation of the Park and Ride service.

Therefore the licence is not reasonably necessary to the use of the City Lands, although it is acknowledged that it assists the City Lands to provide additional parking. [ 30 ] In

summary, the Hotel submits that the grant under the Parking Agreement is a licence. Further, the rights claimed by the City have created a substantial interference with the Hotel Lands as the result has been a complete occupation of all parking stalls on the Hotel Lands during times of the year when school is in session. This complete occupation detracts substantially from the possessory and ownership rights of the Hotel to the Hotel Lands for which it pays property tax and maintenance costs.

The use and value of the parking areas on the Hoter Lands to the Hotel is lost for at least half of the year. [ 31 ] Further, the parking areas are not available on the Hotel’s property as required by the Land Use Bylaw. Therefore the Hotel submits that if the Caveat does attempt to protect a grant of easement, that the Caveat be discharged as the Parking Agreement is not capable of forming the subject matter of a grant and is inconsistent with the possessory rights of the Hotel. B.

If the Answer to Issue 1 Is “No”, Should the Caveat Be Discharged Pursuant to Section 48(4) of the Land Titles Act ? [ 32 ] Alternatively, the Hotel submits that the licence within the Parking Agreement represents a covenant or condition described in

section 48 of the Land Titles Act as it precludes the owner of the servient tenement from making use of the parking area on its lands when the dominant tenement exercises its rights under the grant. Section 48(4) of the Act allows any covenant or condition registered against land to be modified or discharged by order of the court on proof of the following two items:– (

a) the condition or covenant conflicts with the provisions of a land use bylaw; and (

b) the modification or discharge is in the public interest. [ 33 ] With respect to requirement (

a) above, the condition referred to in the Caveat restricts the availability of parking available to the patrons of the Hotel. While it is not worded as such, the effect of the condition has been to completely eliminate the availability of any parking stalls in the shared parking areas during the day. As a result, the Hotel is unable to comply with the parking requirements in the Land Use Bylaw and its business activities are affected. [ 34 ] In Crump v. Kernahan (1995), 1995 CanLII 9145 (AB KB) , 32 Alta.

L.R. (3d) 192 at paragraph 27 Justice Rawlins stated that with respect to section 48(4) , “[a] conflict would only exist if complying with the covenant [or condition] meant violating the bylaw.” The test was further confirmed by Justice Slatter (as he then was) in Potts v. McCann , 2002 ABQB 734 at paragraph 41 where he stated that:– The second part of the

section provides that the covenant can be discharged or varied if it conflicts with the land use bylaw. As

previously mentioned, (supra, paragraph 15) it has now been established that "inconsistent" must mean that it is impossible to comply with both the bylaw and the covenant. See Seifeddine v. Hudson Bay Company, supra , and Tanti v. Gruden 1999 ABCA 150 (CanLII) , [1999] 11 W.W.R. 294 , 74 Alta. L.R. (3d) 110 , 23 R.P.R. (3d) 186 (C.A.) . That test is not met, because it is admittedly possible to comply with both the bylaw and the covenant in this case.

There is accordingly no basis upon which the covenant can be discharged under s. 48 . [ 35 ] It is submitted that as the test is “impossibility”, the Hotel argues that the parking licence in the Parking Agreement makes it impossible for the Hotel to even partially comply with the Land Use Bylaw for months at a time. [ 36 ] The Land Use Bylaw

section 7.3(2)(

e) requires a hotel to have 1 stall per guest room plus additional stalls in accordance with the parking requirements for any other uses forming part of the hotel. In order to comply with this requirement after the renovations in 2006, the Hotel needed 379 parking stalls according to the issued Development Permit. The Hotel could provide only 276 stalls on the Hotel Lands and, to rectify the deficiency, reference was made to the overflow parking available to the Hotel under the Parking Agreement. Of the 276 stalls on the Hotel Lands, just over half are covered by the Reciprocal Parking Agreement.

It is submitted for half the year the Hotel is only able to legally ensure parking spaces for just over a third of its required 379 parking stalls. It is submitted that the City’s overuse of the grant under the Parking Agreement has resulted in the Hotel’s inability to comply with the parking requirements set out in the Land Use Bylaw and required by it’s development permit. [ 37 ] The Hotel submits that discharging the Caveat to prevent the restraint on its opportunity from the City’s overuse of the Hotel Lands is in the public interest.

However as noted in Potts , “municipal planning, by its nature, involves the imposition of minimum standards that are deemed necessary in the public interest”, and restrictive covenants are permitted to provide for higher standards than those imposed by the municipality.

The Hotel notes that the opposite is also true: a restrictive covenant or condition on land cannot disregard the minimum standards imposed by a municipality, as it is not in the public interest for the terms of the Parking Agreement to be used in such a way by the municipality that it is impossible for half the year for the Hotel to meet the minimum parking standards imposed by the municipality. C.

If the Answer to Both Issues 1 and 2 Is “No”, Should the Caveat Be Modified Pursuant to Section 48(4) of the Land Titles Act to Give Effect to the Stated Purpose of the Parking Agreement? [ 38 ] The Hotel submits that the Caveat should be modified to give effect to the purpose of the Parking Agreement. As a contract, the intention of the parties must be found within the terms of the Parking Agreement.

Although the grant within the Parking Agreement states that it is a non- exclusive licence, the effect has been that the dominant tenement has exclusive use over the parking areas on the Hotel Lands for a significant period of time. The patrons of the Hotel are unable to use the parking areas on the Hotel Lands during business hours, during the week, and the Hotel’s business will suffer if parking continues to be an issue for Hotel patrons.

This potential is evidenced by the letter from a third party dated September 24, 2009 which notes concerns about parking availability and a reluctance to book future events at the hotel. [ 39 ] In Shelf Holdings at paragraph 31 the Court of Appeal noted that “[t]he key...is to look at the grant of easement to assess the extent of the rights relinquished by [the servient owner] as opposed to the rights it reserved.” The terms of the Parking Agreement should be used to assess the rights which were intended to be relinquished by the Hotel however it is submitted that it is evident from the granting clause that the Hotel did not intend to surrender the entire parking area on the Hotel Lands during weekday business hours.

Rather it was intended for use for overflow parking, when needed, and reference to overflow use indicates that it was not intended to allow the Hotel Lands to be used in its entirety by the City on a regular and continuous basis during the times permitted under the grant. Coupled with the statement that it is a “non-exclusive licence”, the intention of the parties to relinquish only part of their rights in the parking area on their respective lands is clear. [ 40 ] It is submitted that the wording of the Parking Agreement does not imply any exclusive parking or access rights. In 820204 Alberta Ltd. v.

McLarty , 2002 ABQB 1049 at paragraphs 24 to 29 Justice Read interpreted an easement for a “free and uninterrupted right of way” for access and parking as one in which “the dominant tenement owner’s right to access must be balanced against the servient tenement owner’s right to make legitimate use of its own property.” Even the term “free and uninterrupted” was not held to mean exclusive access as Justice Read found that the easement was not intended to “disable the [servient land owner] from parking vehicles” and that the owner of the servient tenement “should be permitted to make reasonable use” of its land notwithstanding the grant of easement.

Based on the terms of the easement, the Court required the owner of the dominant tenement to provide reasonable notice to the servient owner when it needed use of the entire parking area.

[ 41 ] It is submitted that the principle which can be taken from 820204 is that the servient owner should be allowed reasonable use of its lands even when the grant of easement is wide.

Since the growth in transit use and the change in its hotel business, the circumstances surrounding the Parking Agreement have significantly changed, and the Hotel it is argued is unable for at least six months to have any benefit of use of its parking lot during business hours during the week. [ 42 ] Given this, the Hotel requests that the Caveat be modified to include a termination date to allow for the Hotel and City to negotiate a new parking arrangement which will take into account the changed circumstances.

The Hotel requests that it be permitted to discharge the Caveat no earlier than December 31, 2011 or upon four (4) months notice at any point in time after December 31, 2011. [ 43 ] In the alternative, the Hotel requests that the Caveat be modified to ensure that the Hotel has exclusive access to, at a minimum, half of the parking stalls in the area identified in the Caveat.

This will give effect to the intention that the licence was for a non-exclusive and shared use of the parking areas. [ 44 ] An easement allowing the dominant tenement to park does not automatically give it priority to park over the servient tenement. In Bibieffe International Holdings B.V. v. York Region Condominium Corp. No. 838 , [2000] O.J.

No. 3579 at paragraphs 1 and 5 , the Ontario Court of Appeal interpreted an easement which granted access over a strip of land “for the purpose of parking vehicles.” The Court found that the priority given under such an easement was not one of exclusivity but that the servient tenement is required only to ensure that it “exercise its rights in a manner that respects the rights granted” to the dominant tenement.

The Ontario Court of Appeal further noted that “easements are ordinarily interpreted in a manner that does not deprive the servient owner of its proprietary rights.” The Hotel submits that the grant under the Parking Agreement is non-exclusive and that the Caveat should be modified to ensure that the City is not depriving the Hotel of its of its own proprietary right to park on the Hotel Lands. Conclusion [ 45 ] The City is a municipality that operates a transit service under the name St. Albert Transit.

The Village Landing Transit Station, located at the corner of Grange Drive and Gate Avenue is one of the City’s two transit centres. The City is the owner of the land on which the Village Landing Transit Station is located. The Village Landing Transit Station is on the same City block as the St. Albert Inn, which is owned by the Hotel. [ 46 ] The predecessor transit facility to the Village Landing Transit Station could not accommodate a Park and Ride service.

The City acquired the land for the Village Landing Transit Station from Canpro Investments Ltd. and from the Hotel in order to set up that service in 2000. [ 47 ] Since 2001, the Village Landing Transit Station has operated as a Park and Ride facility. The Village Landing Transit Station is supported by parking facilities located on the City’s Land and on land of neighbouring property owners, including the Hotel.

There are approximately 500 parking stalls associated with the operation of the Village Landing Transit Station, half on land owned by the City and the other half on the lands of neighbouring property owners. [ 48 ] The land that the City bought from the Hotel was subdivided out of Plan 812 2934, Block 3, Lot 7 under the terms of a Real Estate Purchase Contract, made September 27, 2000 (the “Real Estate Purchase Contract”).

The City paid $101,232.00 for the land and both the City and the Hotel acquired the right to a Reciprocal Parking Agreement. [ 49 ] The Real Estate Purchase Contract included certain conditions:– d. On or before December 5, 2000, the Parties sign a mutual access and reciprocal parking agreement to ensure vehicular access, parking (excluding commercial vehicles) and future use of roads by both Parties to the Property and Vendor’s remaining lands.

3. Parties agree to the following terms regarding access and parking that same shall be included in the agreements contemplated in 2(d): a. The Purchaser shall pave the area outlined in red on

Schedule “A”; b. The parking area outlined in green on

Schedule “A” shall be made available for use by the Purchaser’s park and ride patrons on weekdays; c. The parking area outlined in blue on

Schedule “A” shall be made available for use by the Vendor’s patrons on evenings and weekends; 4. The parties agree Purchaser’s condition 2 (

d) shall also be a condition for the benefit of the Vendor. If the condition is not fulfilled or waived by both parties on or before December 5, 2000, this Offer shall be null and void. [ 50 ] The parties extended time for fulfillment of the Reciprocal Parking Agreement condition. [ 51 ] On December 6, 2000, legal counsel for the Hotel Mr. Trofimuk, apparently posed a series of questions about parking requirements under the Land Use Bylaw 18/94. Curtis Cundy, the City’s Director of Planning and Development Services, responded on December ii, 2000, repeating Mr. Trofimuk’s questions and responding to each.

One question and answer was:– 6. Whether the off-site parking in Lots 7 and 9 can be used by the hotel in its development applications for any future development as of-site [sic] parking, even though the hotel will only have access to these lots on evenings and weekends?

Based on your discussion with our General Manager of Planning and Engineering Services and the terms of the proposed Reciprocal Parking Agreement, the shared parking in the said Agreement will be utilized in any present or future parking calculations. [ 52 ] On December 15, 2000, each party confirmed that the condition regarding the Reciprocal Parking Agreement was fulfilled. On December 28, 2000, the City and the Hotel executed the Reciprocal Parking Agreement. [ 53 ] The Reciprocal Parking Agreement provided inter alia :– WHEREAS: A.

The City is or is entitled to become the registered owner of lands in the City of St. Albert legally described as Plan 8122934, Block 3, Lot 8 and Lot 9 and that portion of Plan 8122934, Block 3, Lot 7 all as outlined in blue on the drawing attached hereto as

Schedule “A” (the “City Lands”). B. Sturgeon is the registered owner of lands in the City of St. Albert legally described as Plan 8122934, Block 3, Lot 7 (the “Sturgeon Lands”). C. The City and Sturgeon wish to enter into a reciprocal parking agreement with respect to the City Lands and that specific portion of the Sturgeon Lands as outlined in green on the drawing attached hereto as

Schedule “A” (the “Hotel Lands”).

NOW THEREFORE THIS AGREEMENT WITNESSETH... 3. This Agreement shall be for an indefinite term. If the City ceases to operate a Transit Station on the City Lands or Sturgeon or its successors ceases to operate a hotel business on the Hotel Lands, this Agreement can be terminated by either party on 180 days written notice to the other party.

The Parties agree that if either one terminates this Agreement in accordance with the required notice, the terminating Party shall not be liable to pay any compensation whatsoever for any loss, costs or damages which may be suffered or incurred by the other Party or any person claiming under the other Party by reason of such cancellation. . . . Grant by Sturgeon 5. Sturgeon grants to the City a non-exclusive license to use the Hotel Lands as an overflow parking area for its weekday transit service “park and ride” patrons. 6.

If Sturgeon expands its hotel building and removes any parking stalls from the Hotel Lands, Sturgeon shall grant parking to the City within the remaining Sturgeon Land, under the same terms and conditions. Grant and Covenants by City 7. The City grants to Sturgeon a non-exclusive license to use the City Lands as an overflow parking area for its hotel patrons on evenings and weekends. 8. The City agrees to pave the area outlined in red on the drawing attached hereto as

Schedule “A” as soon as weather permits, as determined by the City in its discretion. 9. The City agrees that the parking space provided to Sturgeon pursuant to this agreement is intended to constitute

Section 44 off-site parking for the purpose of fulfilling Land Use By-law No. 18/94 parking requirements. 10. The City shall install such signage as it deems necessary to adequately instruct users of the Parking Areas as to permitted and intended use. The number of signs, wording of sign locations shall be determined by the City in its discretion after reasonable consultation with Sturgeon. Mutual Covenants 11. The Parties agree that each shall be responsible for keeping its own portion of the Parking Areas adequately maintained and cleaned including regular snow removal, sweeping and painting. 12.

The Parties will immediately advise each other, in writing, of any damages occurring in the Parking Areas or of any areas in need of maintenance, cleaning or repair. If the owner fails to complete the required work within a reasonable period of time having regard to the weather conditions and the gravity and severity of the problem, the party giving notice may complete the work and provide an invoice for the cost of such work to the owner. All invoices presented shall be paid within 30 days of receipt. 13. Commercial vehicles are prohibited on the City Lands.

14. The parties acknowledge and accept the provisions of the access easement registered as easement 812285002 and agree that they shall not take any action to discharge the easement or to limit access. 15. Except for:

a) the use by patrons and customers herein contemplated; and

b) those agreements entered into and disclosed by either Party on or before November 30, 2000; the parties shall not enter into any further agreements or grant any rights to use the Parking Areas to any other party. 16. Each party shall be responsible for maintaining general comprehensive insurance in an amount not less than Two Million ($2,000,000.00) Dollars per occurrence against losses, costs, damages or charges affecting its lands.

Concurrent with the execution of this agreement, the parties shall provide one another with reciprocal certificates of insurance confirming that the Parking Areas are covered under the owner’s general comprehensive insurance policy. 17. The rights herein conferred shall constitute an interest in land by way of an easement running with the lands and shall bind the successors, assignees and transferees of the City and the Sturgeon respectively. Either party shall be permitted to register a Caveat against the other’s lands protecting the rights herein granted.

Upon the termination of this agreement, the parties shall immediately, at their own cost, discharge any caveat so registered. [ 54 ] On April 25, 2001, the City of St. Albert registered a Caveat against the Hotel’s Land, which reads in part:– TAKE NOTICE that I, Larry Galye, Agent for the City of St.

Albert (the “Caveator”) claim an interest by virtue of an agreement with the registered owner of the following lands, wherein the Sturgeon Hotel was [sic] granted an easement running with the land granting a non-exclusive license to use the lands as a parking area, as more particularly described in the agreement a copy of which is attached Plan 81222934, Block 3, Lot 7 Containing 1.71 Hectares (4.23 Acres)More or Less Excepting thereout: Hectares (Acres) More or Less

a) Plan 0120027 – Descriptive 0.237 0.59 Excepting thereout all mines and minerals being lands standing in the Register in the name of STURGEON HOTEL LTD. and I forbid the registration of any person as transferee or owner of, or of any instrument affecting that estate or interest, unless the instrument or Certificate of Title, as the case may be, is expressed to be subject to my claim. The Reciprocal Parking Agreement is attached as part of the Caveat. [ 55 ] On April 10, 2001 the Hotel registered its Caveat based on the Reciprocal Parking Agreement, describing its interest in the City Land as an “easement”.

[ 56 ] Initially there were no parking issues between the Hotel and the City. However in 2006, the Hotel planned an expansion to add 48 new guest rooms, a swimming pool, water slide, storage, retail space and office when the City’s development officer noted that under the Land Use Bylaw there was insufficient parking on the Hotel’s Land to accommodate the expansion, Michael Mazeppa the General Manager of the Hotel responded.

He provided to the development officer a copy of the Reciprocal Parking Agreement under which the Hotel had parking rights on the City Land, and stated “1 do believe that this will address the parking deficiency.” He also attached the letter from the City’s Director of Planning and Development Services dated December 11, 2008, to the Hotel’s counsel responding to his questions about parking. [ 57 ] The City’s development officer granted a development permit for the expansion on November 17, 2006 subject to conditions, including:– 15.

Parking: A total of 379 stalls are required for the development overall in accordance with

Part 7 of the Land Use Bylaw. As approved, the total number of parking stalls provided is 487; consisting of 258 stalls on-site with an additional 229 stalls accessible on an adjacent site in accordance with the Reciprocal Parking Agreement dated December 28, 2000 between the applicant/developer and the City of St. Albert. [ 58 ] After the development approval was granted, the market for retail went flat so the retail portion of the proposed development was converted to 3 small meeting/banquet rooms.

In addition, changes in smoking regulations and gaming regulations had eliminated the demand for the cocktail lounge and reduced the number of VLTs in the Hotel. Instead the Hotel’s focus moved to attracting banquets and meetings, including day time events as a result of the availability of the small banquet rooms as break out rooms, the Hotel was now able to attract new meeting/banquet business. [ 59 ] Between 2002 and 2009, the population of the City of St. Albert grew. There was also an increase in the number of routes served by St. Albert Transit. In September 2007, St.

Albert and other municipalities in the metropolitan area introduced the U-Pass for students at the University of Alberta and Grant MacEwan College. NAIT was added to the U Pass program in 2010. Ridership on St. Albert Transit grew significantly. [ 60 ] From 2007 on, the City recognized that growth in transit ridership would put pressure on parking facilities near the Transit Station. The City began working with adjacent owners to curb illegal parking. [ 61 ] The City also worked with the Hotel and other neighbouring owners to develop alternatives to reduce parking pressures on legally available sites.

Specifically with respect to the Hotel, the City worked with Mr. Mazeppa and identified and marked two rows of parking within the area covered by the Reciprocal Parking Agreement as “Inn Patrons Only.” In the Fall on 2009, the City tried a shuttle from the Akinsdale/Kinex Arena to the Village Landing Transit Station on a pilot basis. Transit patrons could park at the Arena and take the shuttle to the Village Landing Transit Station.

Not surprisingly, the pilot project proved unsuccessful. [ 62 ] The City has also worked to expand the number of additional stalls available around the Transit Station, and was successful in adding 20 additional stalls. It continues negotiating for a further 20 stalls. The City also undertook public education program in the Fall of 2010 to advise its patrons about alternatives to Park and Ride.

This has led to a reduction in the number of complaints to the City about Park and Ride, and apparently no concerns have been expressed from the Hotel in the Fall of 2010. [ 63 ] The City is also working on plans to develop additional Park and Ride facilities and is seeking capital funding to support the development of these alternative facilities. It has identified a new Park and Ride Facility in the Anthony Henday Corridor as it’s first priority for funding from the Green Trip program of the provincial government anticipated to come into effect for 2011-2012.

However, as with all proposed government programs, there is no certainty that there will be funding or if there is, the timing of that funding is still to be determined. [ 64 ] Understandably at this time, the City is not in a position to walk away from the rights granted to it under the terms of the Reciprocal Parking Agreement.

Pattern of Usage of the Hotel Lands Covered by the Reciprocal Parking Agreement [ 65 ] The parking on the City Land and the Hotel Land covered by the Reciprocal Parking Agreement is free and available on a “first come/first serve” basis. No parking is reserved for Park and Ride users. The parking is all open to the Hotel patrons and Park and Ride patrons. [ 66 ] The usage of the parking “ebbs and flows” over the year, and over the course of each day.

On an annual perspective, there is no pressure on the parking facilities over the summer month and Christmas, or during times when students are writing exams, reading week and generally when the U of A, NAIT and Grant MacEwan are not in classes. On a daily basis, there is no problem with early morning parking for breakfast meetings as there is some parking available at 7.00 a.m. Problems begin to arise after 7:00 a.m. However if there is an early morning breakfast meeting at the Hotel, stalls will become available when the meeting ends.

Then as the day progresses stalls become available as the students start to come home, with stalls beginning to open up after 1.00 p.m. There are no problems with availability of evening parking. [ 67 ] The Hotel began to barricade stalls within the area of parking covered by the Reciprocal Parking Agreement in September 2009. The Hotel has also marked a number of rows of parking spaces “Private Property No Parking In Parking Lot Except Authorized St. Albert Inn and Suites Visitors and Guests”. A.

The Reciprocal Parking Agreement Creates a Caveatable Interest in Land [ 68 ] The Caveat filed by the City against Descriptive Plan 0626838, Block 3, Lot 15 (formerly Plan 8122934, Block 3, Lot 7) is based upon the rights granted under the Reciprocal Parking Agreement. The issue before this court is whether the Reciprocal Parking Agreement creates an interest in land. [ 69 ] The Applicant Hotel attacks the Caveat on 2 grounds:– (

a) the Reciprocal Parking Agreement does not go far enough to create an interest in land and creates a mere license; (

b) the Reciprocal Parking Agreement goes too far and in fact raises “the grant above the status of an easement”. The Reciprocal Parking Agreement Creates More Than a “Mere License” [ 70 ] The Applicant argues that the Reciprocal Parking Agreement creates a license, and therefore cannot run with the land however the issue is not whether the Agreement creates a license, but rather whether the Agreement creates an interest in land. [ 71 ] The fact that the Reciprocal Parking Agreement includes a reference to a licence is not fatal to a finding that the Agreement creates an interest in land.

In Shelf Holdings Ltd. at paragraph 13, our Court of Appeal found that there was an easement where the grant referred to both a license and an easement:– “GRANT, TRANSFER and CONVEY unto and to the Grantee, for itself, its servants, agents and contractors, the right, license, liberty, privilege and easement to use so much of the said lands as may be necessary for a right-of-way for the laying down, construction, operation, maintenance, inspection, removal, replacement, reconstruction and repair of a pipeline together with all such stations, drips, valves, fittings, meters and other equipment and appurtenances as may be necessary or convenient in connection therewith, for the carriage, conveyance, transportation and handling of petroleum or petroleum products, water and/or gas through or by means of the same, and the right of ingress and egress for all purposes incidental to this grant as and from the date hereof and for so long hereafter as

the Grantee may desire to exercise the rights and privileges hereby given, on the following terms and conditions:” [ 72 ] Nor is it fatal to the Reciprocal Parking Agreement that it deals with parking as a parking agreement can constitute an interest in land, including an easement: Moncrieff ; 820204 Alberta Ltd. at paragraph 18 ; Bibieffe International Holdings B. V. ; Metropolitan Toronto Condominium Corp. No. 1250 v. Mastercraft Group Inc. , 2009 CarswellOnt 4281 , 2009 ONCA 584, (Ont. C.A.) at paragraph 81 ; Depew v.

Wilkes , 2002 CanLII 41823 (ON CA) , 2002 CarswellOnt 2516 , 60 O.R. (3d) 499 , 162 O.A.C. 23 at paragraphs 18 - 26 . [ 73 ] The question of the nature of an interest created by an express grant must be answered by reference to the Agreement itself:– The degree of occupation or possession will be governed by the document conceding the grant. Shelf Holdings Ltd. at paragraph 35 ... it is in each case a question of intention to be determined by the Court on the construction of the particular document, and with due regard to the nature of the covenant and the surrounding circumstances. Rogers v.

Hosegood cited in Oluk v. Marahrens , [19761 AJ. 630; 1976 ALTASCAD 87 (CanLII) , [1976] 4 W.W.R. 94 at paragraph 26 [S.C. A.D] The nature and extent of a right-of-way depends on the proper construction of the language of the instrument creating it. Paul v. Canadian Pacific Ltd. , 1988 CanLII 104 (SCC) , [1988] 2 S.C.R. 654 at paragraph 22 A review of the documents and a consideration of the intent of the parties forming the agreement regarding a right of way is necessary to determine the nature of the grant. Maritime Telegraph and Telephone Co. v.

Chateau Lafleur Development Corp. [2001] N.S.J. 96 ; 2001 NSSC 14 at paragraph 24 (S.C.) . [ 74 ] The Reciprocal Parking Agreement sets out clearly in

Article 17 that the intention of the parties was to create an interest in land:– 17. The rights herein conferred shall constitute an interest in land by way of an easement running with the lands and shall bind the successors, assignees and transferees of the City and the Sturgeon respectively. Either party shall be permitted to register a caveat against the other’s lands protecting the rights herein granted . Upon the termination of this agreement, the parties shall immediately, at their own cost, discharge any caveat so registered. [Emphasis added] [ 75 ] That

Article alone should be sufficient to establish that the parties intended to create an interest that runs with the land, as our Appeal Court noted in Oluk v. Marahrens , [1976] A.J. No. 630 ; 1976 ALTASCAD 87 (CanLII) , 68 D.L.R. (3d) 294 at paragraph 27 (S.C.A.D.) :– The document under consideration sets out that the covenants and restrictions “shall run with the land” and without more, I am of the opinion that those words clearly set out the intention of the parties within the principle enunciated in the Shayler v. Woolf case, supra . In addition we find the words that they “extend to ... the undersigned, being the registered owner in fee simple of the said lands, and every

purchaser and/or transferee from the undersigned ... and assigns respectively”. I therefore have concluded that the covenant runs with the land. [ 76 ] The Agreement must be interpreted as a whole, and as such

Article 5 of the Agreement which makes reference to a “license” is neither inconsistent with nor paramount to the clear intention set out in

Article

Article 17 of the Agreement is clear, and must be interpreted to mean that the City and the Hotel intended for the interest created, to be an interest in land. [ 77 ] It is also worth noting that the Applicant has also protected it’s rights under the Reciprocal Parking Agreement by way of a Caveat describing them as constituting an “easement”. [ 78 ] The proposition that the Reciprocal Parking Agreement runs with the land is further supported by the provision in

Article 3 that the agreement is for an indefinite term and that the rights granted cannot be terminated, except if one of the parties ceases to use the lands for the purpose identified for the dominant tenement:– 3. This Agreement shall be for an indefinite term . If the City ceases to operate a Transit Station on the City Lands or Sturgeon or its successors ceases to operate a hotel business on the Hotel Lands, this Agreement can be terminated by either party on 180 days written notice to the other party.

The Parties agree that if either one terminates this Agreement in accordance with the required notice, the terminating Party shall not be liable to pay any compensation whatsoever for any loss, costs or damages which may be suffered or incurred by the other Party or any person claiming under the other Party by reason of such cancellation. [Emphasis added] [ 79 ] It is further supported by the provision in

Article 15, which clarifies that while the rights granted in

Article 5 are “non-exclusive”, it is not open to either party to grant rights to any other person:– 15. Except for:

a) the use by patrons and customers herein contemplated; and

b) those agreements entered into and disclosed by either Party on or before November 30, 2000; the parties shall not enter into any further agreements or grant any rights to use the Parking Areas to any other party. [ 80 ] In the words of the standard test for an easement from Re Ellenborough Park; Re Davies; Powell v. Maddison , [1955] 3 All E.R. 667 at 673 :– (

a) The land owned by the City for the Village Landing Transit Centre is the dominant tenement, the Hotel Lands are the servient tenement; (

b) The servient tenement accommodates the use of the land of the dominant tenement. The dominant tenement is a transit centre designed to accommodate park and ride. The parking on the servient tenement accommodates the use of the land of the dominant tenement; (

c) There are different owners (although under

section 68 of the Land Titles Act , this is no longer a factor in Alberta); (

d) The easement is capable of forming the subject matter of a grant – it creates more than a personal interest in the City to park its vehicles on the property. It creates the right for the City to include the Hotel Lands within the operation of its transit facility on an

indefinite basis. [ 81 ] The case at bar is distinguishable from Imperial Oil v. Young cited by counsel for the Hotel. In that case, the Court noted at paragraph 14, that it was possible to have an easement for the parking of motor vehicles, particularly by means of a written agreement, however based on the specific wording of the instrument in that case there was no easement in that case. The grant in Imperial Oil v.

Young read:– Imperial acknowledges that Young has enjoyed certain parking privileges on the property subject to the Lease in respect of Young’s tire sales operation on the property of Young immediately adjacent to the property described in the Lease. Imperial undertakes to continue these parking privileges beyond the termination of the Lease on a basis mutually satisfactory to Imperial and Young. [ 82 ] Significantly the agreement in Imperial Oil v. Young did not include the wording that appears in Articles 3 and 17 of the Reciprocal Parking Agreement herein:– (

a) establishing an indefinite term for the Agreement, terminable only on the City ceasing to operate a Transit Station; and (

b) specifying that the rights “shall constitute an interest in land by way of an easement running with the lands and shall bind the successors, assignees and transferees of the City.” [ 83 ] The Reciprocal Parking Agreement does not go too far and confer on the City “a right of possession in the servient lands” to an extent that is inconsistent with the possessory rights of the servient owner, as stated in Grant v. MacDonald 1992 CanLII 5969 (BC CA) , [1992] B.C.J.

No. 1359 ; 15 B.C.A.C. 241 at page 7:– I do not think that we should struggle to conclude that an instrument is illegal or unenforceable. [ 84 ] There is a limit to the scope of an easement, which is assessed by addressing the question:– Is the grant inconsistent with the proprietorship or possession of the alleged servient owner? [ 85 ] At the core of the easement is the issue of whether ownership of the land has in fact passed:– The exclusive or unrestricted use of a piece of land, I take it, beyond all question passes the property or ownership in that land, and there is no easement known to law which gives exclusive and unrestricted use of a piece of land.

Metro. Ry. Co. v. Fowler , [1893] A.C. 416 (H.L.) as cited in Shelf Holdings, at paragraph 20. [ 86 ] The question of whether these limits have been exceeded involves a balancing because the very nature of an easement means that “the dominant tenement will to some extent, at least, interfere with the servient tenement”.

The need to recognize this balancing of rights was recognized by our Court of Appeal in Shelf Holdings at paragraph 34:– As was pointed out earlier, it follows from the general nature of the recognized interests in property that an easement cannot amount to a claim quite at variance with the proprietary rights of the servient owner. On the other hand, it is also quite obvious that an easement does to some extent detract from those rights.

A right of way cuts down the servient owner’s right to exclude people from his property or to develop it as he pleases; and a negative easement such as light, also hinders development. The issue in fact is the perennial one of the

drawing the line, of deciding when the point has been reached that the right in question detracts so substantially from the rights of the servient owner that it must be something other than an easement . [Emphasis added] [ 87 ] Or as Moen, J. noted in Nelson v. 1153696 Alberta Ltd. , [2009] A.J. No. 1414 , 2009 ABQB 732 at paragraph 174 :– An easement is, by necessity, a burden on the servient tenement, as its owner has effectively granted away some right to another landowner.

An easement, once granted, may be used for any purpose by the dominant tenant, even where the burden on the servient is increased: Laurie v. Winch , 1952 CanLII 10 (SCC) , [1953] 1 S.C.R. 49 , at 57 . [ 88 ] An easement accommodates not only the use of land at the time of the grant, but also intensification of that use. In Grant v. MacDonald the B.C. Court of Appeal upheld an easement that allowed the construction of a pool in an area that covered most of the grantor’s backyard. In Vantreight v.

Gray (1993), 33 R.P.R. (2d) 49 (B.C.S.C.) , aff’d (1994), 1994 CanLII 1189 (BC CA) , 43 R.P.R. (2d) 179 (B.C.C.A.) the B.C. Court of Appeal noted that while an easement cannot equate with a transfer of land, the rights contained can significantly detract from the owner of the servient tenement’s rights and still be held enforceable. These cases were considered and applied in Alberta by Rooke J. (as he then was) in Westside Land Corp. v. Deszynski , [2004] A.J.

No. 256 at paragraphs 15 - 18 , a case dealing with an easement for a right of way that was argued to be wider that required. [ 89 ] I conclude that the Reciprocal Parking Agreement does not create a set of rights that is inconsistent with the proprietorship or possession of the Hotel. The easement does not “give exclusive and unrestricted use” of the Hotel Lands to the City. The rights are non-exclusive as the Hotel can use the parking on a “first come/first serve basis.” When patrons of the Hotel arrive first, they can park in the available spots, either on the Hotel Lands or the City Lands.

In addition, there are parking spots on the Hotel’s Lands that do not fall within the scope of the easement as there have been lands removed from the scope of the easement by agreement. [ 90 ] In 518002 Alberta Ltd. cited by counsel for the Hotel, Master Funduk considered an easement claimed over neighbouring land for the benefit of two lots. He found no easement to exist for two different reasons each unique the proposed dominant lands:– (

a) With regard to the first lot, the issue was whether the easement complied with the second branch of the Ellenborough test – “the easement must accommodate the dominant tenement.” He held that because there was a 6- foot-high fence between the dominant and servient lands, that the dominant land could not possibly benefit from an easement for access and egress of vehicles: “...motor vehicles cannot jump six foot high fences and neither can most people”(paras. 35-38). [ 91 ] However there is very limited factual similarity with the present case in that the Master found with regard to the second lot, the issue did engage the fourth branch of the test – “the easement must be capable of forming the subject matter of a grant”, as there was an easement for access and egress but the circumstances giving rise to it were highly suspicious because:– (

i) The easement covered 44% of the total area of the lot, was four times the width necessary to accommodate the proposed use, and purported to cover land entirely unnecessary for that use. (ii) The party asserting the easement had previously been the owner of the servient lands, and had granted himself the easement before surrendering the servient lands to the City of Edmonton for failure to pay replotting fees and property taxes (at para. 19). A critical feature of this case is that the Master found that the granting of the easement to oneself prior to forfeit was a “poison pill” done in bad faith (at para. 57).

It was in this context that the Master found the claimed easement to be pernicious, unreasonable, and a sterilization of the City’s proprietary interest in the land (at paras. 54-59). [ 92 ] Batchelor v. Marlowe also cited by the Hotel’s counsel was not a case involving a written agreement for an easement as it was a case involving an easement by prescription. By contrast, the case at bar involves rights that were acquired under a written agreement for consideration, including cash and a reciprocal easement.

Batchelor also did not deal with a “non-exclusive right to park”, as the right claimed in Batchelor “was exclusive of all others” including the owner of the servient tenement. In the case at bar, the grant is a right for patrons to park on a “non-exclusive” basis. Further, there is a serious issue as to whether Batchelor v. Marlowe remains good law given Grant v. MacDonald ; Vantreight v. Gray ; and Moncrieff v. Jamieson .

The Use by the City of the Easement Is Consistent with the Terms of the Easement [ 93 ] The Hotel’s case is founded not on what the easement says, but on the use made of the easement by the City. I conclude in this case that the use made of the easement by the City should not form a major part of the consideration of whether or not the easement is valid. In most cases where the extent and even the nature of the grant is in dispute, the question of excessive use will be unhelpful, because one can only determine whether the use is excessive once one has decided the extent of the grant: McAdams Homes Ltd. v.

Robinson [2004] EWCA Civ 214 (CA) at paragraph 28. [ 94 ] In any event, when one construes the easement according to the ordinary principles of contractual

interpretation, the City’s use of the Hotel Lands is consistent with the grant, which is a non-exclusive right to use the Hotel Lands as an overflow parking area for its weekday transit service “Park and Ride” patrons. [ 95 ] The evidence is that the parking area operates on a first come, first served basis. The parking area is not always full with transit patrons. It is heavily utilized at certain points in the year, and on a daily basis, during those busy times, it begins to fill up around 7.00 a.m. and then during the course of the day stalls open up so that by 1.00 p.m. there are stalls generally available.

There are no issues with evening parking. [ 96 ] If there is any ambiguity, it is appropriate to consider the documents and circumstances surrounding the creation of the easement. The Real Estate Purchase Contract contemplated use of the Hotel’s Lands during the day as follows:– b. The parking area outlined in green on

Schedule “A” shall be made available for use by the Purchaser’s park and ride patrons on weekdays; c. The parking area outlined in blue on

Schedule “A” shall be made available for use by the Vendor’s patrons on evenings and weekends; [ 97 ] This was consistent with the nature of the Hotel’s business at the time, when the cocktail lounge and VLTs were still a significant presence.

Section 48 of the Land Titles Act Does Not Give the Court Jurisdiction to Amend an Easement Agreement That is Protected by a Caveat [ 98 ] I conclude that neither the Caveat nor the Reciprocal Parking Agreement constitute restrictive covenants amenable to modification or discharge under section 48(4) of the Land Titles Act . [ 99 ] By their nature, easements impose rstrictions on what the owner of the servient tenement can do:– The case law makes it clear that an easement which grants a right of way confers a right to reasonable use of that right of way by the dominant tenement owner in common with the servient tenement owner and that the servient tenement owner cannot do anything that obstructs or interferes with the right of way “in any substantial way”: 820204 Alberta Ltd. v.

McLarty , at paragraph 33

[ 100 ] However that does not turn an easement into a restrictive covenant. The parking rights afforded by the Reciprocal Parking Agreement do not constitute a restrictive covenant as they are primarily an easement. They do not meet the first test of the standard requirement for a restrictive covenant, namely they are not “negative in nature.”: Crump v. Kernaghan at paragraph 10. If the Court Has Jurisdiction to Amend an Easement Agreement That Is Protected by a Caveat under

Section 48 of the Land Titles Act , It Should Not Do So in the Present Circumstances of This Case [ 101 ] I conclude that even if the Caveat or Reciprocal Parking Agreement constitutes a restrictive covenant for the purposes of section 48(4) of the Land Titles Act , there are insufficient grounds to modify or discharge the Caveat. [ 102 ] Under section 48(4) of the Land Titles Act , the Court may modify or discharge a restrictive covenant, if:– (

a) the modification will be beneficial to the persons principally interested in the enforcement of the condition or covenant, or (

b) the condition or covenant conflicts with the provisions of land use bylaw or statutory plan under

Part 17 of the Municipal Government Act , and the modification or discharge is in the public interest. [ 103 ] The ground described in (

a) does not apply herein, and arguably the ground described in (

b) does not apply either given that the parking rights under the Reciprocal Parking Agreement do not conflict with the Land Use Bylaw, and it would not be in the public interest to modify or discharge the Caveat protecting the Agreement. No Breach of the Land Use Bylaw [ 104 ] I conclude the operation of the parking lot as contemplated under the Reciprocal Parking Agreement does not contravene the Land Use Bylaw.

The parking requirements of the Land Use Bylaw do not require that parking spaces be empty or empty at a particular point in the day or time of the year, just that they be provided by a developer. [ 105 ] The present position taken by the Hotel on this point is contrary to the position it took in 2006 when the Hotel wanted to expand its hotel. Then the Hotel did not have sufficient parking stalls on its own land for the expansion, even if every stall on its land was empty. The Hotel relied on the spaces which it obtained from the City as the quid pro quo in the Reciprocal Parking Agreement.

The Hotel obtained the development permit by relying on off-site stalls that were made available to it on the City Land. It did not suggest at that time that those spots were filled with commuters and hence not parking stalls for the purpose of the Land Use Bylaw. If the Reciprocal Parking Agreement is set aside or modified, the Hotel cannot expect to say it has parking that it requires to meet it’s parking obligations on City Land under the Reciprocal Parking Agreement.

Modification or Discharge Is Not in the Public Interest [ 106 ] I conclude that modification or discharge of the Reciprocal Parking Agreement to eliminate parking stalls available for Park and Ride will undermine the effective operation of the Park and Ride System and detrimentally affect others in the neighbourhood, as the City Manager noted in his letter to Mr. Mazeppa dated November 12, 2009 dealing with the barricading of stalls to transit patrons:– Each time the hotel acts in this manner up to 142 stalls are lost to transit park and ride patrons.

The impact of the loss of parking stalls is felt directly by the transit users and then subsequently by surrounding businesses and residential areas as the transit users seek parking in

other areas around the Village Transit Station. Other St. Albert Transit partners, like Village Landing and the Christian Reformed Church, are negatively impacted by the selfish actions of the St. Albert Inn. [ 107 ] The effective operation of the Park and Ride system is in the public interest, and that interest should not be undermined. Disposition [ 108 ] The application of the Hotel is dismissed, with costs. Heard on the 16 th day of November, 2010. Dated at the City of Edmonton, Alberta this 22 nd day of November, 2010. Donald Lee J.C.Q.B.A. Appearances: Shauna N. Finlay Fraser Milner Casgrain LLP for the Applicant William W. Shores, Q.C. Shores Jardine LLP for the Respondent