Harwood Farms Ltd v Western Irrigation District, 2021 ABQB 467

Court of Queen’s Bench of Alberta Citation: Harwood Farms Ltd v Western Irrigation District, 2021 ABQB 467 Date: 20210616 Docket: 2001 06831 Registry: Calgary Between: Harwood Farms Ltd. and Mervin Harwood Plaintiffs - and - Western Irrigation District Defendant _______________________________________________________ Reasons for Decision of the Honourable Mr. Justice W.P. Sullivan _______________________________________________________ Introduction [ 1 ] The Plaintiffs are engaged in the agricultural business involving crops and livestock.

Between 1942 and 1990 they acquired 4.5 sections of land (the “ lands ”) for their business. The lands, which they still own today, are located approximately 12 kilometers northeast of the Town of Strathmore, Alberta. [ 2 ] Over the years, as will be expected from industrious and attentive land owners, Mervin Harwood and Harwood Farms Ltd. (“ Harwood Farms ”) jointly increased the productivity of their lands. [ 3 ] The Western Irrigation District (“ WID ”) owns a canal in fee simple that runs through the Harwood Farm’s lands.

The canal is essential to convey and deliver irrigation water to farmers, ranchers, rural municipalities, and other water users. [ 4 ] The WID is responsible for the maintenance, control, and proper management of the canal. In pursuit of this responsibility, the Defendant installed a relief gate to release run off spring water and snow melt adjacent to the Hardwood Farm’s lands.

The installation and use of the relief gate is the subject of this litigation. [ 5 ] The Plaintiffs request an order of this court removing instrument number 7183BG, registered as a Restrictive Covenant or as a Caveat, from the Certificate of Title to lands owned by the Plaintiffs, specifically the SW 2-25-24 W4M (the “ SW quarter ”) of their

lands. They also request interim and permanent injunctive relief against the WID from constructing a relief gate on the said lands for the purposes of discharging water from the canal anywhere on the SW quarter. In addition, the Plaintiffs request general and special damages. [ 6 ] For the following reasons the Plaintiffs’ claim is dismissed. It is therefore unnecessary for me to address the Defendant’s submissions regarding the necessity of clean hands when seeking a permanent injunction.

The Restrictive Covenant [ 7 ] The WID has a restrictive covenant, Instrument 7 I 83BG, registered in its favour on the Certificate of Title on the SW quarter of the lands.

The restrictive covenant permits the WID the right to discharge water from Canal B only if it is discharged into a natural watercourse: And also reserving to the Company, its successors and assigns, the right to at all times hereafter enter in and upon the said land, and to dig, construct and maintain the necessary ditches and canals for properly supplying water to the said land and adjoining lands, and without liability direct or indirect to spill water from its main and secondary canals into any natural water courses in, on or upon the said land. [ 8 ] This restrictive covenant is a reservation contained in the original transfer dated June 26, 1914. [ 9 ] The restrictive covenant sets out the following rights in favor of the WID:

a) The right at any time to enter upon the lands to make surveys for any irrigation canal, ditch, reservoir or irrigation works;

b) The right to take and acquire such portion of the lands as may be required for the irrigation canal, ditch, reservoir or irrigation works and for that purpose to enter upon, use and occupy the lands to such an extent as may be necessary in connection therewith provided that compensation is paid;

c) The right hereafter to enter in or upon the lands to dig, construct or maintain the necessary ditches and canals for properly supplying water to the lands and adjoining lands; and

d) The right to without liability directly or indirectly to spill water from its main and secondary canals into any natural water course in, on or upon the lands. Background [ 10 ] The Canadian Pacific Railway (“ CPR ”) was incorporated in 1881 to build a transcontinental railway from Eastern Canada to British Columbia. At that time, the Government of Canada gave 25 million dollars and 25 million acres of land to the CPR. The railway was part of Canada’s effort to have British Columbia enter Confederation. [ 11 ] After completing the railway, the CPR desired to populate and attract homesteaders to their land.

They constructed an irrigation canal system to make the land suitable for homesteaders. Today, part of this canal runs through the Harwood Farm’s lands. [ 12 ] Each parcel of land sold to homesteaders by the railway contained the above restrictive covenant regarding the canal. In 1944, the CPR transferred title to the canal and all related rights and responsibilities to the WID.

The same year, by act of the Provincial Legislature, all reservations or exceptions with respect to the grant of land in favour of the CPR were transferred to the WID. [ 13 ] Today, the WID delivers water to over 400 farmers including the Plaintiffs, acreage owners, and industrial customers. It provides stormwater removal for Calgary, Strathmore, and Chestermere and provides municipal water supply to Strathmore, Rockyford, Gleichen, Clooney, and Standard. The WID also maintains a dam and a spillway. Procedural History [ 14 ] This action comes to me by way of an order granted by a Justice of this court.

Harwood Farms’ injunction application was adjourned to either a full day civil special application or to a

summary trial. By further order on November 20, 2020, the same Justice ordered this issue to be resolved by a

summary trial process. Evidence Presented at the

Summary Trial [ 15 ] Given the nature of the proceeding, evidence was put before the court by way of affidavits and expert reports. Additional evidence was introduced by way of cross examination on both parties’ affidavits as well as by expert oral testimony. Evidence of Mervin Harwood [ 16 ] The Plaintiffs’ evidence was introduced initially by way of affidavit of Mervin Harwood sworn on October 14, 2020. He advised through his affidavit that when his family first acquired the lands in 1942 not all of the lands were productive for the same agricultural operations pursued in 2020. Over the years, the lands have been improved including being granted rights to take water for a

permanent irrigation of acres from the WID, specifically pivot irrigation. Today, much of the land is used in the production of grain. [ 17 ] Mr. Hardwood states in paragraph 12 of his affidavit “I believe the canal, and all of its related works, was, and remains, under the ownership, maintenance, care and control of the WID who promote their mandate as being one to provide efficient and equitable operations for the distribution of water to its members.” He goes on to state that the canal built in the early1900s was and continues to be controlled by a series of gates placed along the path of the canal.

He recognizes that with increasing concern for water use and consumption, environmental awareness, and increasing urban growth, the WID needs to upgrade and improve the canal efficiencies. Mr. Harwood was approached by the WID with ideas for improving the portion of the canal that flows through his lands. He rejected the WID’s proposal to upgrade the canal and a period of acrimony developed between the parties.

The details of which, in my view, are not essential to the resolution of the issues in this action other than to note a few points. [ 18 ] In 2018, a significant amount of overland water came over the Harwood Farm’s lands down to the canal. In mid-April, the WID re-initiated discussions with Mr. Harwood about steps to be taken for addressing spring run-off and in particular the installation of an off-season run-off relief gate. He stated that he remained concerned about the potential problems and damage that could be created for certain parts of his lands owing to the WID’s planned construction.

But said he ultimately agreed by way of letter agreement dated March 15, 2018 (“ March 2018 agreement letter ”), permitting the WID to upgrade the irrigation infrastructure. The WID constructed and installed a relief gate on the part of their canal flowing through Mr. Hardwood’s lands. [ 19 ] The WID advised him after installation, by an email dated April 13, 2018, that they had decided to open this relief gate a third of the way to release waters. He objected on April 17, 2018, writing to the WID to say that the relief gate should be closed. Mr.

Hardwood said in his affidavit that the WID ignored his advice and as a consequence water began flowing out of the canal through the relief gate and onto SE 2-25-24 W4M (the “ SE quarter ”). [ 20 ] He said that the constant flow and release of the enormous quantity of water in the canal flooded the SE quarter and parts of 35, 36, and 25 of his lands. As a result, 250 acres of grassland and cropland located on the lands was flooded with water mixed soils, flood debris, and other contaminating substances causing substantial damage. [ 21 ] In December 2018, Mr.

Harwood refused to extend use of the relief gate pursuant to the March 2018 agreement letter. The relief gate was necessary to discharge water from the canal. As a result, on October 8, 2020, the WID moved the relief gate from the SE quarter to the SW quarter where they have a restrictive covenant on the land. The WID does not have a restrictive covenant on the SE quarter. [ 22 ] The restrictive covenant allows the WID to spill water from its main and secondary canals into any natural watercourses in or upon the lands to which the restrictive covenant applies. Mr.

Harwood does not believe that there is a natural watercourse on the SW quarter.

He states in paragraph 36 of his affidavit, “if any flooding of the SW 2-25-24 W4M or sections 35, 36 or 25 occurred, it would have an exponential deleterious effect on the lands that took decades to establish.” He goes on to say that “what once may have existed as a possible watercourse or water shed on unproductive lands in sections 35, 36 and 25 has changed significantly into healthy, environmentally sensitive and commercially productive land.” Cross Examination of Mervin Harwood [ 23 ] For himself and for the Plaintiff Harwood Farms Limited, Mervin Harwood gave evidence under oath in cross examination of his affidavit.

He confirmed the following relevant and material information regarding the nature of his relationship with the WID and the water flow over his lands: • A drainage ditch exists that drains the slough on the lands north of the WID canal into the WID canal; • There is a slough on the SE 25 and he has a license to divert water from the slough. This slough is south of the WID canal and is in the SE quarter of the south half of this section. He confirmed that there is a drainage pattern that runs from the NW to the SE; • There is a slough which is at the top, north, end of his property.

He has a drainage canal which runs south to the WID canal from that slough. He confirmed that he does not have a water license for that drainage “because it is natural” and said that the water flowing from that slough has created a channel on its own; and • Interestingly, he pointed out that this channel leads to a screw gate on the north side of the WID canal and that water is also directed by way of a culvert to this gate. The end of the culvert runs from his lands into the WID.

He does not have a water license for this discharge either, although he has permission by way of a permission letter to drain water into the WID. [ 24 ] Mr. Harwood confirmed that he did not open the screw gate at the end of the culvert during the irrigation season. In fact, he specifically denied doing so (this evidence was contradicted by an employee of the WID, “the ditch rider”). He noted that his lands discharge into the canal during periods of high water flow.

When asked “and that’s because of the natural draining pattern; is that right?”, he confirmed that the draining is “because of the lay of the land.” [ 25 ] On cross examination, Mr. Harwood confirmed that if the WID did not intersect his lands, the natural drainage pattern would have the water flow from his land in the north through to his land in the south. Again, he confirmed that it would be the natural flow of the water. [ 26 ] He noted that water north of his lands, to the west, and to the east, flows onto his lands, overland. Further, he confirmed that there is a slough on the SW quarter.

This slough exists because water collected there. He also advised that water flow along the canal is controlled by a series of gates placed along the canal’s path. These gates are required to dump what Mr. Harwood referred to as overland drainage water. [ 27 ] Mr. Harwood stated that the WID wanted to upgrade the canal system through his lands to have it comply with a more

modern standard. He confirmed that he did not agree with their proposals and denied the opportunity to have them place a pre-treatment area north of the canal so that his water could be cleaned before it entered the canal. [ 28 ] Mr. Harwood stated that the spring melt season water is directed through his property by two means: a drainage channel which over tops the WID canal at the SE quarter and a structure that diverts water from the canal into his property at the SE quarter.

He classified his lands south of the canal and north of the public roadway as “poorer quality because of water seepage.” He later advised again that water going from his land overtopping the WID canal bank and going into the canal causes damage to the WID canal. [ 29 ] Most of what Mr. Harwood confirmed in cross examination on his affidavit is corroborated by photographs that were referred to him during the exam that showed water streaming over the bank into the canal - from Harwood Farm’s Lands into the WID canal. [ 30 ] Mr.

Harwood insisted that he would not consent to the construction of an under drain from his northern lands to the southern lands south of the canal. On questioning as to what an under drain is and what it does, he confirmed that it is used so that overland drainage can be directed into its natural drainage pattern under the canal. Evidence of David McAllister [ 31 ] David McAllister is the general manager of the WID. His affidavit states that the WID is one of 13 irrigation districts in Alberta established under the Irrigation Districts Act , RSA 2000, c I -11 (the “ IDA ” ). He goes on to say that under

section 6 of the IDA , an irrigation district has the following statutory purposes and powers:

a) to convey and deliver water through the irrigation works of the district in accordance with the IDA ;

b) to divert and use quantities of water in accordance with the terms and conditions of its water licences;

c) to construct, operate and maintain the irrigation works of the district; and

d) to maintain and promote the economic viability of the district. [ 32 ] Mr. McAllister confirmed that the WID currently conveys and delivers water through 1,200 kilometers of canals and pipelines. It provides irrigation water to over 400 farmers and ranchers, 96,000 acres of land, and supplies municipal water to over 12,000 people in numerous communities located east of Calgary. [ 33 ] In paragraph 8 of his affidavit, Mr.

McAllister said “although the WID can control the volume of water and rate of flow diverted and entering into the irrigation system from the Bow river, it is unable to prevent inflows of natural overland drainage water from precipitation, snowmelt and extreme weather events from entering irrigation system.” He goes on, “the WID, on its canals, has spillways, relief gates and under drains to regulate the water volume in its canals to prevent water overtopping and breaching the canal and causing significant damage or catastrophic failure.

Spillways and relief gates release water from the canal, while underdrains divert natural overland drainage under and to the other side of the canal along the natural drainage pattern of the land. The locations of these spillways, relief gates and underdrains are determined by topography, particularly natural drainage patterns.” [ 34 ] Paragraph 12 of his affidavit reads “the WID had always sought to minimize the collective impacts of inflows to adjacent landowners by using its spillways, relief gates and underdrains, and has attempted to do so equitably among adjacent land owners.” [ 35 ] Mr.

McAllister’s affidavit goes on, “the 1914 topographical map shows a ditch on the Plaintiffs’ lands located along the boundary of the SW quarter and SE 2-25-24 W4M (the SE quarter) initially running from north to south.

Remnants of the ditch remain, including an old wooden gate on the WID canal leading from the ditch and the culvert that runs under the municipal road on the south boundary of the south half.” [ 36 ] Importantly, he made note of the fact that the municipal road, running east to west and forming the south boundary of the lands, contains two ditches or culverts for transferring water from the north side of the highway, being the south of the Harwood Farm’s lands, to the south side of the highway. [ 37 ] The 1914 topographical map shows the elevation of land slopes from the north to the southeast of these lands.

It places the Plaintiffs’ land along the south boundary of the south half, 26.2 feet lower in elevation than the canal elevation further to the north of the quarter section. [ 38 ] Mr. McAllister also noted that when the land comprising the SE quarter was transferred by the CPR to the original owner, the CPR reserved the right to spill water. However, in 1957 when the land was transferred to a subsequent owner, the new certificate of title was issued by the land titles office without the restrictive covenant regarding the spillage of water. This appears to be an oversight or an act of negligence.

The WID and its predecessor never consented to the removal of this restrictive covenant from title. [ 39 ] Photographic evidence dated October 15, 1977, shows that the Plaintiffs’ lands contained a ditch installed by the Plaintiffs to drain a wet slough depicted in the 1914 topographical map. Mr. McAllister said in paragraph 25 of his affidavit that “the Plaintiffs maintained and operated a drainage ditch on their lands north of the WID canal. The drainage ditch drains water from the Plaintiffs’ lands and a slough on the Plaintiffs’ lands located north of the WID canal in the south half.

The drainage ditch is man-made and artificially channels overland drainage water and water from a slough on the Plaintiffs’ lands to the WID canal. At the southern terminus of this ditch are a screw gate and a culvert into the WID canal” that the Plaintiff’s control. They can open and close the screw gate at their pleasure, draining overland discharge water into the WID canal. [ 40 ] According to Mr. McAllister, since the permission to do this was revoked in December 2020, the Harwoods have further

channelized drainage on the lands above the canal on the SE quarter. The WID does not wish to receive further drainage from this location. [ 41 ] It is also interesting to note that in October 2017, in an attempt to cooperate with the Harwoods, the WID offered to treat the Plaintiffs’ drainage water before it entered the WID canal. The WID offered at its cost to construct a pre-treatment pond or facility for this purpose. As stated in the above discussion of the Plaintiffs’ evidence, they rejected this offer. In this regard, Mr.

McAllister notes that Alberta Agriculture and Forestry requires that water conveyed for irrigation purposes by an irrigation district be of “irrigation quality”. The Harwood water flowing into the WID does not meet this standard and requires pre-treatment. [ 42 ] Mr. McAllister goes on “rehabilitation of the canal downstream of the south half included the installation of underdrains, overbank swale and relief gates (also referred to as discharge gates), similar to those proposed to Mr. Harwood, at regular intervals, as topography allowed, so as not to disproportionately impact any one adjacent land owner.

These landowners had been significantly affected by spring run-off events in the past, partly due to the Plaintiffs’ significant drainage into the WID canal.” Mr.

McAllister gave evidence regarding the creation and expansion of the Crowfoot spillway west of the lands used to rehabilitate the canal and later in his affidavit discussed how these relief gates are used equitably along the length of the canal so that “no landowner is impacted disproportionately.” [ 43 ] At paragraph 46 of his affidavit he states “during the 2018 flooding disaster, floodwater from the Plaintiffs’ land inundated the WID canal, overtopping its embankments.

To compound matters, the Plaintiffs were also discharging drainage water from their drainage ditch into the WID canal immediately upstream of the relief gate.” Mr. McAllister was advised by an employee of the WID that “from April 23 to April 25, 2018, despite the overland flooding in Wheatland County, only the Plaintiffs’ lands had overland drainage running over the bank of the WID canal.” This was in breach of their letter agreement known as the “Permission Letter.” He confirmed that the WID irrigation system is designed for conveying water for irrigation purposes, it is not designed for drainage purposes.

To be used for drainage, the WID would be required to redesign their irrigation works and infrastructure at a cost of hundreds of millions of dollars. [ 44 ] Additionally, the WID has offered to construct, at its cost, an underdrain on the south half of the lands that would allow the Plaintiffs’ overland drainage and water from its drainage ditch to by-pass the WID canal by going under the WID canal and onto the Plaintiffs’ lands south of the WID canal. The Harwoods have refused this offer.

Despite the reasonable “options presented by the WID whether it be a pre-treatment facility or an under drain, the Plaintiffs have refused to agree to any option.” [ 45 ] In conclusion, Mr. McAllister stated that the relief gate on the SW quarter is not located on the Plaintiffs’ lands, but is in very close proximity (1.96m). Further, the relief gate is necessary for the WID to reduce the damage caused by the Harwood Farms drainage water.

Without the relief gate, more water that is not of “irrigation quality” will flow downstream in the WID canal and will imperil the WID’s irrigation works and licensed water, the municipal infrastructure of Wheatland county, and adjoining and downstream landowners. [ 46 ] Mr. McAllister stated that it is not beneficial to the WID nor in the public interest to modify or remove the restrictive covenant registered against the certificate of title on the SW quarter. [ 47 ] In cross examination on his affidavit, Mr.

McAllister confirmed much of the evidence he gave in his affidavit. [ 48 ] I pause here to note that the entire WID is gravity driven, there are no pumps in the irrigation system. [ 49 ] At page 168 of his cross examination, Mr. McAllister said at line 18, “we know that there’s water flowing in downstream of the Crowfoot spillway across the Plaintiff’s lands and other locations as well. In order to have consistent control throughout and treat everybody equitably, we need to have the ability to release so that the downstream landowners are not – are not affected.

So we’re trying to equitably distribute impacts across the system, and that’s why you see a regular spacing of relief gates or underdrains as part of the remediation and rehabilitation of that system.” Expert Reports [ 50 ] The parties each called one expert who gave their evidence both by way of affidavit and orally in court. There are no issues with respect to the qualifications of either expert. Evidence of Nathan Schmidt [ 51 ] Harwood Farms called Nathan Schmidt, professional engineer and PhD with expertise in water resources. [ 52 ] Dr. Schmidt answered three questions: 1.

Does a watercourse exist at the SW quarter? ; 2. Does a Wetland exist at and adjacent to the properties? ; and 3. Are there alternative locations in the local area where excess water could be discharged without flooding the properties or present land, being the lands in question? [ 53 ] He determined in his report, at

section 5.1, that watercourses have been defined by the Alberta Water Regulation, The Alberta Environment Protection and Enhancement Act and The Alberta Public Lands Act. In conclusion, after reading and reviewing those

definitions, he said this, “these

definitions are open to

interpretation for small watercourses or drainages, particularly those without defined beds or banks, but for those small flow conveyances, there must be a point at which a flow path becomes a watercourse.” He

then went into a definition of streams stating that they may “characterized based on hydrology as perennial/permanent, intermittent or ephemeral…ephemeral streams tend to take the form of vegetated channels or swales, with shallow side slopes and without a defined bed or bank. Ephemeral streams serve as a path for runoff into Order 1 streams. These runoff paths may be assigned a stream order of zero, and are not considered to be watercourses.” [ 54 ] In

section 5.2.5 under

Summary of Hydrology at the Properties, Dr. Schmidt said this: The WID crosses SW and SE 2-25-24-W4M and intersects two flow paths of interest, including: • the outflow from the Natural Basin, which has a natural drainage area of 584 ha upstream of the WID canal, and an additional drainage area of 149 ha that has been diverted into the basin from the Diverted Basin.

Site visit photographs of this area are provided in Appendix C.; and • t h e SW Flow Path, which has a natural drainage area of 1.6 ha upstream of the WID canal, and potentially an additional drainage area of 8.4 ha that has been diverted due to disturbance at the WID canal. Site visit photographs of this area are provided in Appendix C. A Wetland is present in the Natural Basin. Based on the small drainage area and the presumed absence of a defined channel, the SW Flow Path should not be defined as a watercourse. [ 55 ] At

section 5.3.1 he said, “our understanding is that the primary concern with discharge from the WID canal is the potential for flooding at the downstream land farmed by Mr. Harwood, at SW and SE 36 and NE 25-23-25 W4M. We understand that a substantial portion of the downstream land was previously occupied by a wetland and that in the 1970s, Mr.

Harwood installed drainage improvements and actions to improve soil quality…we further understand that recent WID canal discharge has caused flooding of the land, up to the extent of the previous wetland boundary, and future inundation has the potential to cause loss of seeded crops and adverse effects on soil quality.” He goes on to say that “1950 and 1967 air photos show a well developed wetland at the downstream land; the 1977 airphoto appears to show a dewatered wetland and drainage works in progress.” [ 56 ] In his

summary, at

section 6 of the expert report, Dr.

Schmidt concluded that “no water course is present in SW 2-25-24 W4M; a runoff path is present in that area, but based on the desktop study, the small drainage area and lack of defined channel means that it is simply an overland flow path.” He goes on to say that “a watercourse does appear to be present in SE 2-25-24 W4M, based on the larger drainage area, the defined channel that was present even in historical air photos, and its identification on county mapping.” [ 57 ] Further, he concluded that an “inspection of historical air photos supports the County mapping, which shows a substantial wetland located north of the property, as well as a larger wetland in the downstream land.” Evidence of Ryan McDonald [ 58 ] The WID called as their expert Ryan McDonald.

He is a specialized hydrology expert and provides hydrologic consulting and research services. He answered similar questions to Dr. Schmidt after conducting a study of the subject lands. [ 59 ] Dr. McDonald reviewed the report by Golder and Associates, the Schmidt report, and said, “based on the

definitions of a watercourse defined in the report, the small drainage area, and the absence of the defined channel, Golder (2020) does not define the flow path to be a watercourse and instead describes it as an overland flow path.” Dr. McDonald goes on, “in general, I agree with the findings in Golder (2020) in that it is likely that an overland flow path is present, with no defined channel.” [ 60 ] Dr. McDonald then discussed the definition of a natural watercourse and after reviewing different

definitions concluded that “these

definitions all converge on the requirement of having features that relate to the presence of water. However, they do not define the spatial or temporal requirements for the presence of water and there is variation in terms of the need for a defined channel, bed, and banks. Therefore, the

interpretation of these

definitions requires a level of subjectivity or judgment.” He then referred to the Alberta Supreme Court (Appellate Division) in Makowecki v Yachimyc at paragraph 64 which in law defines watercourse. I quote this paragraph below at paragraph 67 of this judgment. [ 61 ] Dr. McDonald was asked “what is the natural drainage pattern on the lands?” (page 5 of his expert report) He replied, “the flow accumulation model supports the characterization of the drainage patterns on

Section 2-25-24 W4M provided by Golder (2020) showing primary drainage on the lands through the channel traveling north to south from a northern wetland. There are additional drainage paths on the lands including on the SW 2-25-24 W4M where in the southern end of the parcel flowing southeast crossing the WID canal (the SW drainage) as well as on the east side of the lands on SE 2-25-24 W4M that travels roughly north to south (the SE drainage).” The expert cited figure 2 in his report, identifying it as supporting the drainage pattern described. [ 62 ] Dr.

McDonald then, in his report, referred to figure 4, a 1914 topographic map of the lands on S 2-25-24 W4M showing the drainage ditch near the SW drainage. Taking from the affidavit of Dr. Schmidt he concluded that “a review of the air photos provided by Golder (2020) as well as those in figure 5 of his report and recent satellite imagery help provide historic review of the lands from 1950 to the present day. Based on the review of the satellite imagery, air photos, stream layers, and site visits (Golder 2020), the primary drainage through S 2-25-24 W4M appears to the natural drainage pattern.

This primary drainage pattern that he refers to is the natural drainage for the subject lands.” [ 63 ] In his discussion towards the end of his report, Dr. McDonald said “it’s likely there is water flowing ephemerally on the SW drainage. I agree with the findings from Golder (2020) that this is primarily overland flow; however, evidence suggests that the overland flow is not simply dispersed and that it does concentrate to provide longer-term soil moisture conditions that differ from the surrounding landscape.

Overall, any conclusive statements about the presence of a watercourse are difficult to make because the land has been modified by a century of farming and little data exists prior to this modification.”

[ 64 ] A review of figure 2 in Dr. McDonald’s report is quite illustrative to me of the drainage patterns on the lands. Issues [ 65 ] The Plaintiffs’ claim raises two issues: 1. Does the restrictive covenant or the law of drainage permit the WID to spill water from the relief gate located on the WID canal onto the Plaintiffs’ lands in the SW quarter? 2. What is the appropriate definition of natural watercourse for the purpose of the restrictive covenant and does it include historical or previous natural watercourse?

Analysis of Issue 1 [ 66 ] The restrictive covenant as identified above dates back to June 26, 1914, and grants the WID, as assignee of the CPR, the right to spill water from its main and secondary canals into any natural watercourse. Both parties have identified the “natural watercourse” issue as the main question to be decided in this case. Analysis of Issue 2 [ 67 ] The Alberta Supreme Court Appellate Division dealt with the definition of watercourse in Makowecki v Yachimyc: 64.

There is a clear distinction between a "watercourse" in the sense of flowing stream with a definite channel with a distinct bed and distinct banks or edges formed by the water cutting the soil; in respect of which both upper and lower properties have certain riparian rights each against the other; and a watercourse in the sense of surface water coming from rains and melting snow, it may be throughout a long distance and in large bodies, and not being merely diffused generally over the surface but flowing in a definite channel provided by natural gullies or ravines or depressions but in which when the water is not flowing there is no distinct bed nor at any time any cutting of the soil so as thus to mark the banks or edges of the channel, though doubtless in such cases a careful examination of the soil would show the height to which the water rose on the last occasion and probably the line of its usual height; in respect of which there would be no riparian rights but on the part of any proprietor through whose land the channel passed to appropriate if he wished the whole of the water coming to him and on the other to require the next lower proprietor to receive it in its usual channel; the one is a case of a flowing stream; the other is a case of drainage. [ 68 ] It appears that the decision of the Alberta Court of Appeal is that for watercourses and overland drainage to exist there is no requirement for a distinct bed or banks; the watercourse can just be an overland flow path.

I am satisfied from a review of Dr. McDonald’s expert report, in which he essentially agrees with Dr. Schmidt’s expert report, that there is a water course on the SW

quarter. [ 69 ] The Defendants argue that besides the specific wording of the restrictive covenant, the court must also consider the object and purpose of the restrictive covenant including the intention of the party who imposed it. This will engage a brief analysis of the circumstances at the time and is commonly referred to as the “factual matrix”. [ 70 ] In Granfield v Cowichan Valley (Regional District), Justice Tysoe of the British Columbia Supreme Court said “the wording of the document creating the easement should govern the

interpretation of the use of the easement unless

a) there is an ambiguity in the wording or

b) the surrounding circumstances demonstrate that both parties could not have intended a particular use of the easement that is authorized by the wording of the document.” On this basis, the WID submits that the court in the present circumstance ought to interpret the WID’s right to spill water into natural watercourses on the lands now owned by the Plaintiffs as the right and circumstances existed in 1914. [ 71 ] This is consistent with the Alberta Court of Appeal’s decision in Deagle v 1678452 Alberta Limited .

Further, in IFP Technologies (Canada) Inc v EnCana Midstream and Marketing , the court held that the surrounding circumstances of a contract must be considered even in the absence of ambiguity. A failure to do so will lead to an error rooted in a question of law. [ 72 ] It appears to me that at the time of the purchase of the lands subject to the restrictive covenant, that the entire one half section, and perhaps even the whole section, was a watercourse or overland flow path.

The restrictive covenant was needed at that time to allow the WID to maintain and operate the irrigation system in order to assist downstream farmers by releasing water. [ 73 ] As noted by the WID, paragraph 7 of the Plaintiffs’ Statement of Claim appears to confirm the analysis as to the use of the lands at the time of acquisition by the Harwoods. At that time, the lands were not particularly productive. There is further evidence indicating that the Plaintiffs installed a drain to drain the wet slough on the lands. [ 74 ] As I noted above, Dr. Schmidt was of the opinion “these

definitions are open to

interpretation for small water courses or drainages.” Dr. McDonald, relying on the Makowecki v Yachimyc decision, stated that “the flow accumulation model supports the characterization of the drainage patterns…showing primary drainage of the lands through the channel travelling north to south from a northern wetland. There are additional drainage paths on the lands including on the SW 2-25-24 W4M lands.” [ 75 ] This conclusion is further supported by the fact that the public roadway at the southern boundary of the south

section contains two culverts for the drainage of water from both south quarters onto the further southern lands. [ 76 ] Although it is not necessary for me to do so, having determined that there is a natural watercourse on the subject SW quarter, the restrictive covenant governs. It is therefore not open for the Plaintiffs to dam a natural waterway by in essence converting the use of the lands in 1914 to another use so as to render the restrictive covenant inoperable. [ 77 ] In conclusion, it is clear to me that the whole of the south

section constitutes at least in part a watercourse. But for the existence of the WID canal, water would flow from lands north of the Plaintiffs’ lands onto the south

section through to the public highway at the bottom of the south section. The WID canal, being a constructed facility, in fact as is evidenced by the 2018 flood, does not obstruct the natural flow of water and its natural path created by gravitational pull. It is the natural flow of this water that creates the problem with the Plaintiffs’ water overflowing into the canal. [ 78 ] The claim is dismissed. Costs [ 79 ] If the parties are unable to agree on costs, submissions in writing not to exceed 5 pages may be made within 30 days. Heard on the 1 st day of March, 2021. Dated at the City of Calgary, Alberta this 16 th day of June, 2021. W.P. Sullivan J.C.Q.B.A. Appearances: Peter Major, Q.C.

for the Plaintiffs Richard Jones, Q.C. and Julia Loney for the Defendant