Selenium Creative Ltd. v Edmonton (City), 2023 ABKB 94

Court of King’s Bench of Alberta Citation: Selenium Creative Ltd. v Edmonton (City), 2023 ABKB 94 Date: 20230221 Docket: 2203 14853 Registry: Edmonton Between: Selenium Creative Ltd. operating as Selenium Architectural Millwork Plaintiff/Applicant - and - City of Edmonton Defendant/Respondent _______________________________________________________ Decision on Costs of the Honourable Justice S.N. Mandziuk _______________________________________________________ I.

Introduction [ 1 ] On December 9, 2022, I heard the urgent application of Selenium Creative Ltd. operating as Selenium Architectural Millwork (“Selenium”) under s 64(3) of the Expropriation Act , RSA 2000, c E-13 to extend the time by which Selenium was required to grant vacant possession of its commercial premises to the City of Edmonton (the “City”). [ 2 ] The application arose in the context of a major project undertaken by the City (with funding from other levels of

government) that is intended to turn Yellowhead Trail (a major commercial artery) into a freeway. Expropriation proceedings resulted in a Notice of Expropriation and Notice of Possession being issued with respect to the commercial premises. [ 3 ] The only issue before me was the timing of Selenium’s departure from the commercial premises: should it be January 31, 2023 (the City’s position) or be extended to November 30, 2023 (Selenium’s position)? [ 4 ] I rendered my decision orally on December 16, 2022. I dismissed Selenium’s application.

Selenium did not, on the evidence, meet the onus upon it to extend the date of possession. [ 5 ] I invited the parties to make submissions on costs if they could not agree and they have each provided me with a brief. [ 6 ] Selenium seeks full indemnity for its costs pursuant to the provisions of the Expropriation Act . In other words, despite being the unsuccessful party, Selenium argues that it has a statutory right to costs. [ 7 ] The City seeks costs on column three of

Schedule C to the Alberta Rules of Court , Alta Reg 124/2010 , or on such other scale as the court deems appropriate. II. Liability for Costs A. General Rule [ 8 ] In general, a successful party is entitled to its costs against an unsuccessful party: rule 10.29. However, there are qualifications to this general rule, the particularly relevant ones here being the Court’s general discretion under rule 10.31 and the existence of “an enactment governing who is to pay costs in particular circumstances”: Rules 10.29(1)(

a) and (

d) respectively. B. Statutory Enactment [ 9 ] There are two sections of the Expropriation Act that address an owner’s [1] entitlement to costs in certain circumstances: Payment of costs 35

(1) The owner may obtain an independent appraisal of the owner’s interest that has been expropriated and the expropriating authority shall pay the reasonable cost of the appraisal .

(2) The owner may obtain advice from any solicitor of the owner’s choice as to whether to accept the proposed payment in full settlement of compensation, and the expropriating authority shall pay the owner’s reasonable legal costs for that advice . 39

(1) The reasonable legal, appraisal and other costs actually incurred by the owner for the purpose of determining the compensation payable shall be paid by the expropriating authority, unless the Tribunal determines that special circumstances exist to justify the reduction or denial of costs.

(2) The Tribunal may order by whom the costs are to be taxed and allowed.

(3) When settlement has been made without a hearing and the owner and the expropriating authority are unable to agree on the costs payable by the expropriating authority, the Tribunal may determine the costs payable to the owner and subsections (1) and (2) apply.

(4) On appeal by the expropriating authority, costs of the appeal shall be paid on the same basis as they are payable under subsection (1) and on appeal by the owner, the owner is entitled to the owner’s costs when the appeal is successful and, when unsuccessful, the costs are in the discretion of the Court of Appeal. [Emphasis Added] [ 10 ] Selenium applied to extend the time to vacate the expropriated premises.

Section 64 of the Expropriation Act reads: 64

(1) Within 30 days after the certificate of approval has been registered, the expropriating authority shall, subject to any agreement to the contrary, serve on the person in possession a notice that it requires the land on the date specified in the notice.

(2) The date specified in the notice shall be (a) 7 days from the date of service of the notice when the land expropriated is for a right of way, and (

b) in all other cases, at least 90 days from the date of service of the notice.

(3) Any time after service of the notice, either party may apply to the court on 3 days’ notice for an adjustment of the date for possession specified in the notice referred to in subsection (1) and the court may order an adjustment in the date.

(4) Notwithstanding anything in this section, the expropriating authority is not, except with the permission of the court, entitled to take possession (

a) in the case of land expropriated for a right of way, until the proposed payment has been tendered, and (

b) in all other cases, until the expiry of 30 days after the proposed payment has been tendered.

[Emphasis Added] [11] Selenium takes the position that ss 35 and 39 cover liability and quantum of costs in relation to its s 64(3) application.Principles of statutory

interpretation are engaged. [12] The governing approach to statutory

interpretation was set out by the Supreme Court of Canada in Rizzo & Rizzo Shoes Ltd(Re), (SCC), [1998] 1 SCR 27 (Rizzo). At paragraph 21, Iacobucci, J quoted Elmer Driedger in Construction ofStatutes, 2nd ed (Toronto: Butterworths, 1983)at p 87 with enthusiastic approval: Today there is only one principle or approach, namely, the words of

an Act are to be read in their entire context and in their grammaticaland ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament. [13] Turning to the Expropriation Act, s 35 specifically refers to reasonable appraisal costs with respect to an expropriated propertyincurred by an owner and the costs of legal advice obtained by the owner in deciding whether the compensation payment proposed bythe expropriating authority should be accepted. [14] Section 39(1) refers to the governing tribunal’s power to order that costs incurred by an owner “for the purpose of determiningthe compensation payable shall be paid by the expropriating authority”, and on appeal the owner is entitled to costs if successful, and ifnot, the issue is in the discretion of the Court of Appeal. [15] These sections do not apply to an application under s 64(3).

They apply to costs related to compensation. Selenium’sapplication was not about compensation. The application was about extending possession. There is no reasonable way to interpret ss 35and 39 of the Act to include costs related to anything other than compensation. [16] Selenium argues that jurisprudence supports the principle that all costs incurred by an expropriated owner in connection withthe expropriation should be paid by the authority.

With respect, I do not find the authorities cited by Selenium to be squared with thatproposition. [17] In Nissen v Calgary (City), 1983 ABCA 307, at paragraph 6, while the Court indeed held that compensation payable to anowner must include “all his expenses in connection with the expropriation”, this is in the context of the owner’s entitlement . . . to make enquiries before accepting any offer, and to put the expropriator to a hearing on compensation. Therefore, compensation forthe expropriation must include compensation for these expenses.

These include solicitors' fees. [18] This aligns with Supreme Court comments that “the aim of the [Expropriations Act is] to fully compensate a landowner whoseproperty has been taken”: Toronto Area Transit Operating Authority v Dell Holdings Ltd., (SCC), [1997] 1 S.C.R. 32at para 22 (Dell Holdings). Cory J. in Dell Holdings also refers to the need to read the Act “in a broad and purposive manner in order tocomply with the aim of the Act”, that “the power of an expropriating authority should be strictly construed in favour of those whoserights have been affected” and that a “broad and liberal

interpretation” should be afforded to an expropriation statute: see paras 20 and21. [19] Cory J. concludes that “[t]he application of these principles has resulted in the presumption that whenever land isexpropriated, compensation will be paid”: at para 22. [20] In my view, the broad, purposive, liberal

interpretation enunciated by Cory, J. applies to the financial aspect of theexpropriation process, that is, compensating the owner for the taking of the land. Rizzo requires the Court to consider the entire context,purpose and scheme of the Act as well as its plainly read language.

If the purpose of the Expropriation Act is to compensate for thetaking of land by an expropriating authority, and the Act itself provides mechanisms to determine such compensation, then it is difficultto conclude that the Act grants an automatic right to indemnification of an unsuccessful party for matters that do not relate tocompensation, such as an unsuccessful application to extend the time to vacate expropriated property. [21] Selenium cites The Law of Expropriation and Compensation in Canada (Scarborough: Carswell, 1002) at 507 in itsinterpretation of the federal and Alberta statutes as entitling “the owner to costs in all circumstances”.

This must be read in its context.The previous paragraph in that text specifically refers to costs related to the determination of compensation. [22] While there may be aspirational statements made in academic circles that could support the full indemnity position advancedby Selenium, I am more compelled by the jurisprudence and the plain wording of the statute. If the legislature had intended that costsrelated to matters not related to compensation – bearing in mind that the entire purpose of expropriation legislation is to make ownerswhole (per Dell Holdings) – it could have done so.

In particular, language to that effect could have been inserted into s 64 whereby anunsuccessful owner who was unable to get the notice period extended would receive costs indemnification in any event. [23] The statute is where one looks for the enactment referred to in the costs rules. The applicable enactment in this case onlyrefers to indemnification with respect to compensation. That was not what this application was about. C. Municipality Staff Lawyers [24] Selenium also argues that the City, using staff counsel, should not be granted costs.

The investment of time and disbursementsis part of the City’s “overhead” and it would be inappropriate to grant legal costs in its favour. In other words, there was no actual cost tothe City. [25] The Municipal Government Act, RSA 2000, c M-26, s 554.1 is a complete answer to this argument:

Municipality’s costs in actions 554.1(1) A municipality is entitled to collect lawful costs in all actions and proceedings to which the municipality is a party.

(2) The costs of a municipality in an action or proceeding in which the municipality is a party are not to be disallowed or reducedbecause the municipality’s lawyer in the action or proceeding is an employee of the municipality. [26] In Edmonton (City) v Alberta (Public Utilities Board), 1985 ABCA 6, the Court of Appeal interpreted the meaning of “lawfulcosts” in the corresponding

section of the Municipal Government Act in force at the time. The Court adopted the Supreme Court’sinterpretation of a similar provision in Manitoba legislation which was found to mean “costs which would have been lawful, that isrecoverable by the city, if the attorney or solicitor were not receiving a salary”: Ponton v City of Winnipeg, , page 376. D.

Extended Financial Consequences [27] Selenium finally states that “[a]lthough compensation was not formally before the Court, the consequences of the decisiondirectly engage issues of mitigation, reinstatement, and the scope and nature of Selenium’s business loses and moving costs” (Selenium’sBrief para 15). These consequences are, in my view, matters that could be raised in the compensation proceedings. E.

Decision on Liability for Costs [28] Selenium was wholly unsuccessful in its application, which is not captured by the costs or indemnity provisions of theExpropriation Act. [29] The City of Edmonton was successful. It is entitled to costs. III. Quantum [30] Selenium’s application related solely to the extension of time under s 64(3) of the Expropriation Act. No monetary amountwas sought. [31] Where a remedy other than money is sought, our Court of Appeal has interpreted

Schedule C, Section 1(4)(

b) to mean“where there is no amount involved...Column 1 of

Schedule C applies unless the court orders an enhanced scale”: Freyberg v FletcherChallenge Oil and Gas Inc, 2006 ABCA 260 at para 14.

Thus, the issue is whether there is cause to order costs on a higher scale. [32] In that regard, I refer to Kissel v Rocky View (County), 2020 ABQB 570 at para 8 (per Eamon, J.): It is not unusual to award party and party costs on a higher scale in judicial review applications and other proceedings where the mattersat issue are particularly complex or involve matters of general importance to the public, the parties or both . . . [33] The City argues that it was successful in an application that was urgent, complex and important.

It should be awarded costs onColumn 3 plus disbursements. [34] Rothwell, J. in Auer v Auer, 2021 ABQB 860 addressed the costs framework, noting: [9] Rule 10.31 of the Alberta Rules of Court, Alta Reg 124/2010 [Rules of Court] contemplates a cost award being made at theconclusion of a matter and Rule 10.33 sets out factors that the Court may consider, namely: (

a) the result of the action and the degree of success of each party; (

b) the amount claimed and the amount recovered; (

c) the importance of the issues; (

d) the complexity of the action; (

e) the apportionment of liability; (

f) the conduct of a party that tended to shorten the action; (

g) any other matter related to the question of reasonable and proper costs that the Court considers appropriate. . . . [11] It is well established that: • The successful party is generally entitled to costs: Rule 10.29; • Costs are discretionary subject to specific requirements in the Rules; • Discretion over costs must be exercised judicially and in accordance with established principles; • In appropriate circumstances costs may be increased beyond that provided for in the Schedule;

• Costs may be awarded to or against the AGC: Crown Liability and Proceedings Act, RSC 1985, c C-50, s 28(1); and • Costs ought not to be oppressive. B&R Development Corp v Trail South Developments Inc, 2011 ABQB 706 at paras 4-8; Mikkelsen v Truman Development Corp, 2016ABQB 255 at paras 21 and 23; Pharand Ski Corp v Alberta (1991), (AB KB), 81 Alta LR (2d) 304 at 398; and EldersAdvocates of Alberta Society v Alberta Health Services, 2021 ABCA 67 at para 14 [Elders] [35] Here, the City was wholly successful. No monetary amount was sought by Selenium.

The issues were certainly important tothe parties and were cloaked in urgency; in my view, the issues were of modest (not particular) complexity. The determination was not ofgeneral public importance. [36] The materials were well-prepared and voluminous. Clearly, all counsel involved put a great deal of effort into this well-argued application, which continued into the evening of December 9, 2022. [37] I must exercise my discretion judicially and in accordance with principles that have been established in law. [38] Following from my earlier comments, I do not see a reason to depart from Column 1 costs. IV.

Conclusion [39] Selenium shall pay costs of the application, and this costs determination on Column 1 of

Schedule “C” includingdisbursements. Heard via Written Submissions on the 13th and 16th day of January, 2023. Dated at the City of Edmonton, Alberta this 21st day of February, 2023. S.N. Mandziuk J.C.K.B.A. Appearances: Greg Weber Reynolds Mirth Richards & Farmer LLP for the Plaintiff/Applicant Alexander Witt City of Edmonton for the Defendant/Respondent [1] Selenium held the property in question as a tenant, not as the fee simple owner.The definition of “owner” includes parties with an interest in land registered in the

Land Titles system and “ any other person who is in possession or occupation of the land” and “any other person who is known by the expropriating authority to have an interest in the land”: Expropriation Act , at s 1(k)(ii),(iii) and (iv).