2011 QCCA 780, 2011 QCCA 780

Unofficial English Translation Cloutier c. St-Sauveur (Ville de) 2011 QCCA 780 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-020083-093 (700-17-003747-069) DATE: April 27, 2011 CORAM: THE HONOURABLE PIERRE J. DALPHOND, J.A . JEAN BOUCHARD, J.A. CLAUDE BOUCHARD, J.A. (AD HOC) NATHALIE CLOUTIER and SYLVAIN JULIEN and 9165-5118 QUÉBEC INC. APPELLANTS – defendants v.

VILLE DE SAINT-SAUVEUR RESPONDENT – Plaintiff JUDGMENT [ 1 ] THE COURT ; - On the appeal from a judgment rendered on September 22, 2009, by the Superior Court, District of Terrebonne (the Honourable Madam Justice Sylvie Devito), that ordered the appellants to cease the use that is non-conforming to the zoning by-law; [ 2 ] For the reasons of Dalphond J.A., with which Jean Bouchard and Claude Bouchard JJ.A. agree: [ 3 ] DISMISSES the appeal, with costs; [ 4 ] APPROVES that the respondent will not require compliance with the order prior to October 1, 2011. PIERRE J. DALPHOND, J.A. JEAN BOUCHARD, J.A.

CLAUDE BOUCHARD, J.A. (AD HOC) Mtre Marc-André LeChasseur Mtre Jean-Philippe Guay Poupart LeChasseur s.e.n.c.r.l. For the appellants Mtre Sébastien Dorion Dunton, Rainville For the respondent Date of hearing: March 23, 2011

REASONS OF DALPHOND, J.A. [ 5 ] The appellants appeal from a judgment of the Superior Court that found that the use they were making of the five buildings belonging to them did not comply with the zoning by-law in effect, that they did not have vested rights under a previous by-law, and that they there was no cause to refuse the order sought pursuant to

section 227 of the Act respecting Land use planning and development , RSQ, c A-19.1 (the ALPD). [ 6 ] It is not disputed that the by-law in effect prohibits the appellants' current use of the buildings or that this by-law is valid. There are two issues to be determined by the Court: (

i) Do the appellants have vested rights under the former by-law? (ii) If not, was the trial judge right to refuse to find that it was an exceptional case warranting the exercise of judicial discretion to refuse the respondent's request for an order pursuant to

section 227 ALPD ? CONTEXT [ 7 ] The appellants' buildings were built in a zone where the only permitted use is residential. The plans submitted to obtain the construction permits were for single family homes. The appellants maintain that, in some of the permit applications, they stated that they intended to rent the projected building for short periods of time.

They allege that a municipal employee told them that this was permitted. [ 8 ] In 2005, however, following the merger of the parish and the village of Saint-Sauveur creating the respondent municipality, the appellants received a letter from the municipality in question informing them that the use they were making of the buildings was not permitted in the zone where they had been built. [ 9 ] De facto, the appellants operate a business that may best be described as follows: they have a website related to the lodging and hotel business and a telephone number; they use various means of advertising; they accept online and telephone reservations; in exchange for the use of the homes, they receive payment by credit card, amongst other methods of payment (see the Rules, terms, and conditions of rental form), and they hire staff to ensure the upkeep of the buildings at the end of each rental. [ 10 ] The permits were issued and the use of the buildings began on the following dates: Addresses Date when permits were issued Date when first offered for rental 2 Chemin de l'Escalade March 26, 1997 November of 2003 23 Chemin de l'Escalade July 30, 2002 January of 2003 19 Chemin de l'Escalade March 15, 2004 August of 2004 5 Chemin de l'Escalade August 17, 2004 July of 2006 6, Chemin de l'Escalade April 29, 2005 December of 2005 [ 11 ] According to the by-laws in effect, the repeated rental of a residence for less than four months at a time constitutes an activity that is considered to be a hotel business, not a residential activity.

That activity is therefore prohibited in the zone where the appellants' five buildings are located. POSITIONS OF THE PARTIES [ 12 ] The appellants affirm that they have a vested right to rent their residences for periods of less than four months at a time pursuant to by-law 294-90, which was repealed on September 13, 2005. In their view, this by-law permitted the use that they have made of the buildings because it characterized that use as residential.

Alternatively, they submit that this by-law is ambiguous and that it should be interpreted according to the city legislator’s intent, which was not to regulate short-term rentals, as confirmed by the employee of the parish of Saint-Sauveur. Finally, they argue that continuing their operations would not have any negative consequences, whereas the cessation of same would be catastrophic for them as they are heavily in debt.

Consequently, theirs is a case where the Court should refuse to make the order sought by the municipality. [ 13 ] The respondent answers that, at all relevant times, the by-law in effect stated that the only permitted use was a residential one. The employee Béland addressed the subject of the commercial use of the residences only once. Overall, there is no reason to refuse to make the order sought. It acknowledges, however, that it would not be unreasonable to tolerate the continuation of the prohibited

operations for six months at most to allow the appellants to proceed with an orderly winding-down of their operations. ANALYSIS [14] A reading of regulation 294-90 shows clearly that zone 30, where the appellants' buildings are located, is a residential zone.The specifications grid indicates that this zone is predominantly residential and that the only permitted uses are the following: singlefamily homes, utilitarian community uses, parks and green spaces, and agriculture. There are no other authorized uses, including anycommercial uses.

This is confirmed by the specifications grid attached to the by-law. [15] We must therefore determine what is intended by [translation] "single family home". [16]

Section 32 of by-law 294-90 defines this expression as a [translation] "building with only one accommodation". As for theword [translation] "accommodation", it is defined in

section 13: [translation] Two (2) or more rooms found within a dwelling, which are used or destined to be used as the domicile of one or several persons andwhich includes plumbing fixtures, an area to prepare and eat meals as well as an area for sleeping. [Emphasis added] [17] Overall, the [translation] "single family home" use is defined as being a building comprised of a single accommodation, whichis characterized as being used or destined to be used as a domicile.

The appellants' use does not fit into this category since the tenants arethere in passing and for short periods of time, without any intention of establishing their domicile therein. [18] We must therefore consider whether this use fits into another category of use provided for in the by-law, even though it maybe prohibited in zone 30. [19] The commercial class provided for in the bylaw includes a sub-group called [translation] "Accommodation and entertainmentbusinesses (213)", which specifically includes the following uses: hotels, motels, inns, and bed and breakfasts, all four of which aredefined in the by-law.

The appellants' business does not meet the requirements set out in by-law 294-90 to be considered a hotel, motel,inn, or bed and breakfast. [20] In truth, the appellants' business does not correspond to any of the uses specifically described in by-law 294-90. [21] Sections 32 and 33 of the by-law add that this use must therefore be considered to be included in the class that resembles itmost closely; [translation] 1. Residential class

(100) Residential uses are divided into groups of uses. Residential uses that are not identified in these groups are classified by their similarityto the types of residences listed therein. 33. Commercial class

(200) Commercial uses are divided into groups and sub-groups of uses. The uses listed within these groups or sub-groups must meet thepreviously identified criteria. Unless otherwise indicated in the grid of uses and standards, the lists are non restrictive. Commercial usesthat are not identified therein are classified by their similarity to the uses that are listed. [Emphasis added.] [22] Thus, the appellants submit that the by-law is imprecise.

Given that the remedy for imprecision in a by-law is nullity (JeanHétu & Yvon Duplessis, Droit municipal: principes généraux et contentieux, loose-leaf, vol 1, (Brossard, Qc: Publications CCH, 2009)no 8.128 at 8205), they argue that by-law 294-90 is without effect as against them. The fact, however, that a by-law requires analysis insome situations does not necessarily mean that it is imprecise to the point of nullity (Lorne Giroux & Isabelle Chouinard, Droit public etadministratif, Collection de droit 2010-2011, Yvon Blais, at 439).

The city legislator does not have to describe every possible use for itszoning by-law to be valid. [23]

Interpretation by similarity is a recognized technique in case law. Our Court has said that it involves the identification of thecommon denominator or dominant characteristic of the uses included in the by-law: Immeubles Paroli, s.e.n.c. v. Québec (Ville de)[2010] RJQ 10, 2009 QCCA 2376 at paras 64–67, which should then be compared with the characteristic of the use that is not defined. Inthe course of this exercise, the reasonable person test should be applied: Montreal v.

Arcade Amusements inc, (SCC),[1985] 1 SCR 368 at 401. [24] The trial judge considered that the use made by the appellants of the buildings is similar to a hotel business, which is includedin the commercial sub-group [translation] "accommodations and entertainment businesses (213)", which appears entirely reasonable tome when compared with the dominant characteristic of the appellants' business, short-term accommodation. [25] This conclusion is in accordance with the teachings of our Court in Côté-Paquin v. Sainte-Adèle, JE 95-451 (CA), whereMailhot J.A. wrote: [translation]

The commercial activity conducted by the appellants is not explicitly listed in by-law 500-1982 (800-4Z). The courts have generallyacknowledged, however, that the absence of a clear prohibition with respect to a commercial activity cannot defeat the application of aby-law that prohibits any commercial activity whatsoever inside a specific zone.

In light of the evidence on the record, I am of the opinion that the trial judge did not err in finding as he did that, by offering the cottagesfor rent on a daily or weekly basis, the appellants were operating a commercial activity similar to a hotel business, which is prohibited byzoning by-law no. 500-1982 (8004Z) ... [26] The fact that a representative of the municipality allegedly stated on one or more occasions that short-term rentals werepermitted is irrelevant.

The intention of the city legislator flows from the text that was enacted and cannot be amended by the words oractions of one of its civil servants (Tracy (Ville de) v. Leros-Vac inc, JE 98-1666 (Sup Ct, Crête J.)). As the trial judge rightly stated:Even if it was given, Béland's opinion cannot confer vested rights on the defendants: (para 119 of the judgment). [27] The issuance of a construction permit to the appellants also does not indicate a vested right. These permits were all requestedby Mr. Julien and/or Ms.

Cloutier personally, not by the company, and indicate the construction as being for a [translation] "detachedsingle family home". In fact, Mr. Julien built the first residence to live in himself, not to rent out, an activity that began only six yearslater. As for the fourth, there was a two-year gap between the permit and the start of the rental. [28] The trial judge was therefore correct to find that the use made by the appellants of the residences from the start of their useuntil by-law 294-90 was repealed on September 13, 2005, was prohibited and that they could not argue that they had a vested right.

Iwould add that, as the trial judge so aptly put it, the date of the construction permit or of the start of the construction is irrelevant. Onlythe date on which the appellants began to use the buildings to operate their business is of consequence.

It follows that two of the fivebuildings cannot in any way lay claim to vested rights under by-law 294-90, which was repealed even before their use began. [29] As for her decision not to exercise her discretion to refuse to make the order sought by the respondent, I point out that thisdiscretion is quite limited and must only be exercised in exceptional circumstances, as stated by my colleague Chamberland J.A. inMontreal (Ville de) v. Chapdelaine, (QC CA), [2003] RJQ 1417 (CA) at para 31. [translation] In my opinion, the remedy under

section 227 of the Act includes a measure of discretion, which the court, in specific and exceptionalcircumstances may use to refuse the remedy even where the ground or a construction is used in a way that is inconsistent with municipalby-laws.

This discretion therefore extends not only to the choice of appropriate remedy to correct a non-conforming situation, but also,exceptionally and when warranted by circumstances, to the possibility of dismissing the action even after having observed the existenceof a non-conforming situation. [30] In the present case, it appears that (1) the appellants were warned as far back as 2005 that the use they were making of theirbuildings was prohibited; (2) they will easily be able to sell the buildings as residences, and for an amount greatly superior to theirmortgage; (3) the municipality is prepared to grant them a grace period to wind-down the operation of their business in an orderly way;and (4) the refusal to make an order would be tantamount to judicially granting spot zoning, which would likely be raised by severalother similar businesses operating within the territory of the respondent municipality and would, for all practical purposes, amount to thesuspension of a by-law that was enacted to put an end to a situation that had been described as endemic.

In this case, the public interestcannot be sacrificed for the appellants, who have not proved serious harm should they cease the prohibited use of the buildings. [31] In conclusion, the impugned judgment is well founded in all respects and the appeal should be dismissed. CONCLUSION [32] For these reasons, I would dismiss the appeal with costs, while approving that the respondent will not require compliance withthe order prior to October 1, 2011. PIERRE J. DALPHOND, J.A