2017 FC, 2017 FC 1041

Date: 20171115 Docket: T-1480-17 Citation: 2017 FC 1041 Ottawa, Ontario, November 15, 2017 PRESENT: The Honourable Mr. Justice LeBlanc BETWEEN:GRACE JOUBARNEApplicantandHER MAJESTY THE QUEEN IN RIGHT OF CANADARespondent ORDER AND REASONS [1] On or about September 29, 2017, the Plaintiff introduced, by way of a simplified action, a claim for declaratory relief againstthe Her Majesty the Queen in Right of Canada [Her Majesty] for a dispute over property taxes levied by the City of Belleville againsttwo properties she owns in that municipality.

The Plaintiff contends that the only way the city can obtain property tax revenues from hertwo properties is by making an application to the federal Minister of Public Works and Government Services pursuant to the Payments inLieu of Taxes Act, RSC 1985, c M-13 [the Act] and have these revenues paid out of the Consolidated Revenue Fund, something the cityis declining to do on the basis that the Act does not apply to these properties. [2] In declining to do so, she says the City of Belleville is infringing upon her right to freely dispose ‒ and be free from forceddisposition ‒ of her wealth and resources.

She contends that this right is guaranteed by various international human rights lawinstruments and that the Act is designed, in fulfilment of Canada’s obligations under these instruments, to create conditions allowing herto exercise that right freely.

That protection, entrenched in Canadian domestic law both statutorily and constitutionally, the argumentgoes, is triggered by the fact the properties she owns in Belleville are “federal property” within the meaning of the Act. [3] While her action is directed at Her Majesty, the Plaintiff is for all intents and purposes seeking declaratory relief from theCity of Belleville. In one instance, she seeks relief from the city’s inaction in making an application under the Act.

In another, she isasking the Court to declare that she is entitled to a refund, by the city, of an amount of property taxes she unwillingly paid in 2017. Whysue Her Majesty then? Because the City of Belleville, according to the Plaintiff, is a “servant” of the Crown within the meaning of theCrown Liability and Proceedings Act, RSC 1985, c C-50 [CLPA] and its inaction amounts to a tort of misfeasance in public officeengaging Her Majesty’s liability pursuant to

section 3 of the CLPA. [4] Unsurprisingly, Her Majesty has brought a motion in writing under rules 221 and 369 of the Federal Courts Rules, SOR/98-106 [the Rules] for an order striking out the Plaintiff’s action, without leave to amend, both because this Court lacks jurisdiction toentertain it and because it does not disclose a reasonable cause of action.

This is the motion currently before the Court. [5] As is well settled, a statement of claim will only be struck if it is plain and obvious, assuming the facts pleaded to be true,that it has no reasonable prospect of success (R v Imperial Tobacco Canada Ltd, 2011 SCC 42 , [2011] 3 SCR 45, at para 17[Imperial Tobacco]; Hunt v Carey Canada Inc., (SCC), [1990] 2 SCR 959, at p 980].

Here, this test is clearly met. [6] The Plaintiff’s claim rests on the following three propositions: the property she owns in Belleville is “federal property”within the meaning of the Act; the Act is aimed, in fulfillment of Canada international law obligations, at protecting the Plaintiff’s rightto freely dispose - and be free from forced disposition - of her wealth and resources; and the City of Belleville is a “servant” of theCrown within the meaning of the CLPA and engages, therefore, Her Majesty’s liability for the torts it commits. [7] All three propositions, on their face, are meritless. [8] First, the property at issue does not, by any stretch of the imagination, meet the definition of “federal property” within themeaning of the Act. “Federal property” within the meaning of the Act is either property “owned” or “under emphyteusis” by HerMajesty and administered by a “minister of the Crown” or a “corporation” listed in Scheduled III or IV of the Act, or property which is“occupied or used” by a “minister of the Crown” and administered and controlled by Her Majesty in right of a province.

That definition,set out in subsection 2(1) of the Act, reads as follows: federal property means, subject to subsection(3), propriété fédérale

Sous réserve duparagraphe (3) :(

a) real property and immovables owned byHer Majesty in right of Canada that are underthe administration of a minister of the Crown,

a) immeuble ou bien réel appartenant à SaMajesté du chef du Canada dont la gestionest confiée à un ministre fédéral;(

b) real property and immovables owned byHer Majesty in right of Canada that are, byvirtue of a lease to a corporation included inSchedule III or IV, under the management,charge and direction of that corporation,

b) immeuble ou bien réel appartenant à SaMajesté du chef du Canada et relevant, envertu d’un bail, d’une personne moralementionnée aux annexes III ou IV;

(

c) immovables held under emphyteusis byHer Majesty in right of Canada that are underthe administration of a minister of the Crown,

c) immeuble dont Sa Majesté du chef duCanada est emphytéote et dont la gestion estconfiée à un ministre fédéral;(

d) a building owned by Her Majesty in rightof Canada that is under the administration ofa minister of the Crown and that is situatedon tax exempt land owned by a person otherthan Her Majesty in right of Canada oradministered and controlled by Her Majestyin right of a province, and

d) bâtiment appartenant à Sa Majesté du chefdu Canada, dont la gestion est confiée à unministre fédéral mais qui est situé sur unterrain non imposable qui n’appartient pas àSa Majesté du chef du Canada ou qui estcontrôlé et administré par Sa Majesté du chefd’une province;(

e) real property and immovables occupied orused by a minister of the Crown andadministered and controlled by Her Majestyin right of a province; (propriété fédérale)

e) immeuble ou bien réel occupé ou utilisépar un ministre fédéral et administré etcontrôlé par Sa Majesté du chef d’uneprovince. (federal property) [9] A “minister of the Crown” is a federal minister of the Crown and a “corporation” listed in

Schedule III and IV of the Act is afederal Crown corporation. [10] By her own admission, the Plaintiff recognizes that the property she owns in Belleville is not owned or controlled by HerMajesty. However, she claims that, according to subsection 2(3) of the Act, the definition of “federal property” also includes buildingsdesigned primarily for the shelter of people, driveways for single-family dwellings and real property or immovable leased to or occupiedby a person or body that is not a department.

Since her two Belleville properties are semi-detached buildings presenting all thesecharacteristics, they fall, she says, within this extended definition. [11] Again, by any stretch of the imagination, this cannot be what Parliament intended. Apart from the fact that real property orimmovable leased to or occupied by a person or body that is not a department is excluded from the definition of “federal property”, abuilding designed primarily for the shelter of people or a driveway for a single-family dwelling can only fall within that definition if it isowned or controlled by Her Majesty.

In other words, subsection 2(3) on which the Plaintiff relies to advance her argument, cannot beread in isolation that is without regard to the main definition of “federal property” found at subsection 2(1). Subsection 2(3), whichmakes an express reference to the definition of “federal property”, provides for a number of exclusions from that definition, with anumber of exceptions to these exclusions.

Buildings designed primarily for the shelter of people and driveways for single-familydwellings are two of these exceptions. [12] These exceptions can only make sense however if such buildings or driveways are owned or controlled by Her Majesty in thefirst place.

This is the only way to look at it because the sole purpose of the Act is to establish a regime of discretionary payments in lieuof taxes to provinces and municipalities to mitigate the fact that property owned by Her Majesty is constitutionally exempt fromprovincial and municipal taxation (Halifax (Regional Municipality) v Canada, 2012 SCC 29 , [2012] 2 SCR 108, at paras 2 and10).

That purpose is not to alleviate, in furtherance of some international obligations, the burden of private property owners who claimthat their property should be immune from municipal taxation in the name of one’s right to freely dispose of his/her wealth andresources.

The Act was not meant to assist tax objectors. [13] It is therefore plain and obvious in my view that the Act has no application whatsoever to privately-owned and controlledproperty, such as is the case of the property owned by the Plaintiff in the City of Belleville, and that the first two propositions underlyingthe Plaintiff’s action are devoid of any legal foundation. [14] The Plaintiff’s third proposition is as meritless as the first two. The City of Belleville is not a “servant” of Her Majesty withinthe meaning of subsection 3(b)(

i) of the CLPA. A “servant” of the federal Crown for the purposes of the CLPA is someone who is eitheremployed by the Crown or who acts as an agent for the federal Crown (Ayangma v Canada, (FC), at para 12). TheCity of Belleville is neither. As Her Majesty correctly points out, the City of Belleville has been created, as any other municipality in theprovince of Ontario, by virtue of the Municipal Act, 2001, a provincial statute.

There is no indication in that statute, or in the materialfacts pleaded by the Plaintiff in her statement of claim, that the City of Belleville is employed by Her Majesty or was acting as an agentof Her Majesty when she declined not to make an application under the Act as requested by the Plaintiff. [15] It is true that the City of Belleville is a “taxing authority” for the purposes of the Act but as a “taxing authority”, it does notact on behalf of Her Majesty, such as raising or collecting taxes on her behalf, but it is acting for its own benefit, that is to seek paymentin lieu of taxes that it would otherwise constitutionally not be entitled to levy.

Her Majesty exerts no control of any kind on the City ofBelleville. [16] Finally, the Plaintiff’s contention that it is not open to Her Majesty to bring a motion to strike in the context of a simplifiedaction because such a motion amounts to a motion for

summary judgment, is equally flawed. It is clear from rule 298(2) of the Rules thata motion to strike can be brought in the context of a simplified action. Therefore, there is no doubt that the present motion to strike isproperly before the Court. [17] In Imperial Tobacco, the Supreme Court of Canada held that the power to strike out claims with no reasonable prospect ofsuccess is a valuable housekeeping tool, essential to effective and fair litigation as it ensures that only those claims with a chance ofsuccess proceed to trial (Imperial Tobacco, at para 19).

This housekeeping tool is particularly valuable in a case such as this one wherethe claim has no chance to succeed at trial as it fails to disclose, in any way, shape or form, a reasonable cause of action. [18] The Plaintiff’s statement of claim will therefore be struck out, without leave to amend as I am satisfied that its defects arebeyond redemption and cannot be cured, as a result, by amendment (Simon v Canada, 2011 FCA 6, at para 8). THIS COURT ORDERS that: 1. The motion is granted;

2. The Statement of Claim is struck out, without leave to amend; 3. Costs on the motion are awarded to the Respondent. "René LeBlanc" Judge FEDERAL COURT SOLICITORS OF RECORD DOCKET: T-1480-17 STYLE OF CAUSE: GRACE JOUBARNE v HER MAJESTY THE QUEEN IN RIGHT OF CANADA MOTION IN WRITING CONSIDERED AT OTTAWA, ONTARIO PURSUANT TO RULE 369 OF THE FEDERAL COURTS RULES ORDER AND REASONS: LEBLANC J. DATED: NOVEMBER 15, 2017