BOSA DEVELOPMENT CORPORATION ASSESSOR OF AREA 12 - COQUITLAM. Supreme Court of British Columbia (A942168) Vancouver Registry

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1 The following version is for informational purposes only, for the official version see: for Stated Cases see also: for PAAB Decisions SC 362 Bosa Development Corporation v. AA12 Quick Link to Stated Case #362 (Leave to Appeal - June 29, 1995) Quick Link to Stated Case #362 (Intervenor - September 25, 1996) Quick Link to Stated Case #362 (BCCA - December 23, 1996) BOSA DEVELOPMENT CORPORATION v. ASSESSOR OF AREA 12 - COQUITLAM Supreme Court of British Columbia (A942168) Vancouver Registry Before the HONOURABLE MR. JUSTICE J.T. EDWARDS D.H. Clarke for the Appellant J.E.D. Savage for the Respondent Vancouver, January 11, 1995 & February 10, 1995 Classification -- "used for residential purposes" Specifically Zoned -- Integrated Whole -- Restrictive Covenant --Studies, Soil Testing, Survey Costs The subject property was a large parcel of vacant land zoned for a variety of uses but subject to a restrictive covenant and official community plan. The restrictive covenant severely limited nonresidential development and the official community plan was very specific on the allowed development. The owner had expended significant sums of money on studies, surveys, soil testing etc. with a view to furthering development. The proposed development was primarily residential. The Board found that by virtue of the restrictive covenant, the official community plan, and the expenditure of funds on studies that the property was "used for residential purposes" within the meaning of B.C. Regulation 438/81 Prescribed Classes of Property. In the alternative the Board found that the restrictive covenant, and official community plan effectively zoned the property for residential use. The Board sought to distinguish the existing case law on the basis that the property was part of an "integrated whole", the proposed town centre. One Board member dissented. HELD: Appeal allowed. 1. The Board erred in law in finding that the term "zoning" in B.C. Regulation 438/81 Class 1 included a restrictive covenant;

2 2. The Board erred in law in finding that the expenditures of funds brought the case outside the principles enunciated in Assessor of Area 10 - Burnaby/New Westminster v. Reemark XIII Developments Ltd. et al. (1992) 5 Stated Case 329 (B.C.S.C.); 3. The Board erred in law in finding the property part of an "integrated whole". Reasons for Judgement March 6, 1995 This is an appeal pursuant to s. 74 of the Assessment Act, R.S.B.C. 1979, c. 21 by the Assessor from a majority decision of the Assessment Appeal Board (the Board). The sole issue in the appeal to the Board was the classification pursuant to Prescribed Classes of Property Regulation B.C. Regulation 438/81 (the Regulation) of three contiguous parcels of land (the lands) in the proposed Port Moody town center at the head of Burrard Inlet. The Court of Revision classified the lands as Class 6 (business and other). The Board, by a majority decision, classified the property as mostly Class 1 (residential). Within the Regulation Class 6 is a "basket class" being defined simply as "... all land and improvements not included in Classes 1 to 5 and 7 to 9". The lands are vacant and total approximately acres. The applicable zoning of the lands is TC-1 - Town Center One which permits a variety of land uses including multi-family residential, some commercial use and civic use. The lands are subject to a restrictive covenant between the taxpayer and the City of Port Moody (the City). In the restrictive covenant the taxpayer agrees that "the Lands shall not be used, built on or subdivided except in accordance with this covenant". There is a Development Plan for the lands which is part of the Official Community Plan. The Development Plan provides for the phased development of the town center site to create an environment of mixed land uses including multi-family residential, office and retail, commercial and civic recreational. As of the date for assessment purposes no application for a development permit had been made with respect to the lands and no building construction had commenced. Some geotechnical work and soil studies had been done on the site, some legal and traffic surveys completed and a retail market study done. The facts with respect to this appeal are stated in the Stated Case and are not in dispute. The questions which the Board is required to ask for the opinion of the Supreme Court are: a) Did the Board err in law (in the decision of the majority) in its interpretation of B.C. Regulation 438/81 the Prescribed Classes of Property Regulation, by finding that the term "zoning" in the said Regulation included a restrictive covenant? b) Did the Board err in law in finding the expenditure of funds for a survey, soil testing, traffic counts, geotechnical work, retail market study and legal fees brought the case outside the principles enunciated by this court in Assessor of Area 10 - Burnaby/New Westminster v. Reemark XIII Developments Ltd. et al. B.C. Stated Case 329?

3 c) Did the Board err in law in finding the property was "part of an integrated whole, namely the Port Moody Town Center" and thereby distinguishing the decision of this court in Assessor of Area 10 - Burnaby/New Westminster (supra)? d) Did the Board err in law in its interpretation of s. 1 and s. 10 of B.C. Regulation 438/81 the Prescribed Classes of Property Regulation? THE LAW The relevant provisions of the Regulation are as follows: Class 1 - residential 1. Class 1 property shall include only: (a) land or improvements, or both, used for residential purposes,... (b)... Class 6 - business and other (c) land having no present use and which is neither specifically zoned nor held for business, commercial, forestry or industrial purposes. 6. Class 6 property shall include all land and improvements not included in Classes 1 to 5 and 7 to 9. For land to qualify under the provisions of paragraph 1(a) of the Regulation the land must be used for residential purposes. For land to qualify under the provisions of paragraph 1(c) of the Regulation the land must be unused and the land must be either specifically zoned or held for business, commercial, forestry or industrial purposes. Used for Residential Purposes: The taxpayer's first submission is that because of the restrictive nature of the regulatory regime governing the development of the property the land is effectively "used for residential purposes". In Assessor of Area 10 - Burnaby/New Westminster v. Reemark XIII Developments Ltd. et al (1992) 5 Stated Cases 329 (B.C.S.C.) (Reemark) Newbury J., in interpreting the words "used for residential purposes" in s. 1(a) of the Regulation said:... I do not read any of the cases as supporting the proposition that a piece of vacant land that is not part of an integrated whole or neighbouring or dominant land, but which is intended at a future date to be used for residential purposes, can be so classified because of the issuance of a development permit. There must in my view be something more than an intention to use for residential purposes at a later date. That is surely, the difference between property "held" for residential purposes and property "used" for residential purposes. In Reemark the property was vacant land zoned for various uses including residential and the owner had obtained a development permit for a fourteen storey residential highrise building.

4 Newbury J. in Reemark says that in her opinion there must be something more than an intention. She cites a folksy example to indicate the development of intention. I am going to Ottawa sometime soon. I am going to Ottawa on Tuesday. I am going to Ottawa on Tuesday on Air Canada 943 at 7:00 a.m. and I have my ticket which cost me $ It is clear that the first analogy is pure intention whereas the third analogy is intention plus and would presumably satisfy Newbury J.'s test of "there must be something more than an intention". The majority of the Board concluded that notwithstanding that a development permit had been issued in Reemark and not in this case, the taxpayer is in the third category by reason of having entered into the restrictive covenant and by having expended moneys on the site: the survey, soil testing, traffic counts, geotechnical work, retail market study and legal fees are, in our view, tantamount to construction costs since not a brick can be laid without them. Therefore the requirement that there be "something more than an intention" is in the opinion of the majority of the Board satisfied.... for if this expenditure was not for the furtherance of the project one might well ask "what was it for". In Bosa Development Corporation v. Assessor of Area 09 - Vancouver (1992) 5 Stated Cases 333 (B.C.S.C.), (Bosa), Davies J. concluded that: To change the classification of land on the basis of intention announced by a municipality would surely lead to great uncertainty because intention is subject to change until it is finalized... Intention should not be determinative in the classification of property. The facts before Davies J. were that the property was zoned for industrial and mixed commercial use, the property was primarily vacant and no building permit had been issued. The property had been acquired for a predominantly residential development and the City of Vancouver had determined a policy that the land was to be predominantly used as residential land. The process of rezoning of the property had commenced but had not been finalized on the critical date. The Assessor before the Board submitted that there was something more than "an intention" to use the property for residential purposes. In the case before me, the taxpayer submits that the operation of the restrictive covenant and official community plan resulting in an absolute requirement that a portion of the subject property will have a residential use, changes the character of the property to the extent that it is "used" for residential purposes. The taxpayer says it is as if it were a vacant site zoned for residential use only which would qualify under the regulation for Class 1. In the chambers brief of the taxpayer the issue to be decided is stated in a slightly different way as follows: Millrates are set by the municipalities. In most municipalities, housing will enjoy favourable rates of taxation. The issue is: at what point in the process will residential classification, together with favourable rates of taxation, come into effect.

5 Yuel L. Huie v. Assessor of Area 10 - Burnaby/New Westminster (1993) 5 Stated Cases 349 (B.C.S.C.), a decision of Mr. Justice Drossos on December 2, In this case the property was classified as Class 6, business and other. The taxpayer thought the property should be classified as Class 1 residential. The property was within a Comprehensive Development District permitting a variety of residential and commercial uses. A plan for mixed residential and commercial use submitted by the owner within the regime of the Comprehensive Development District was approved by the Municipality for mixed residential and commercial use. Subsequently the owner sought to eliminate the commercial component and construct residential units. At the relevant date for assessment that application had not received final approval. No building permits had been issued and a grocery store on the property was closed and boarded up and was subsequently demolished. The essential issue for determination in the Huie case was whether the Board had erred in law in finding that at the critical date of September 30, 1991 the subject property was not used in whole or part for residential purposes. On p Drossos J. says: The other issue raised by the Appellant, but not seriously pursued on appeal was that the Board erred by not finding a residential use where the Appellant had applied to change the existing Bylaw to rezone his property to residential use only and intended to use the lands for residential purposes at a later date the rezoning application had not been approved nor a development permit for residential use issued. Also, no construction of residential units had commenced. Drossos J. then quotes then from Reemark and Bosa and goes on to state: These two decisions held that there must be something more than the issuance of a development permit or an intention to use the property for residential purposes at a later date in order to be classified as residential use. In the present case the additional step had not been taken and no actual construction had commenced. In the result the decision of the Board, in Huie, that the subject property's use should be classified as Class 6 business and other, and that the subject property was not used for residential purposes, was upheld. Thus in all three cases, Reemark, Bosa and Huie, the regulatory requirements and authorizations were not sufficient to lead the court to the conclusion that the lands were "used for residential purposes" within the meaning of the Regulation. In the case at bar the distinguishing factors are said to be: a) The restrictive covenant; b) The expenditure of moneys for geotechnical and soil surveys and for legal, traffic and market surveys. I have little difficulty in concluding that the latter factor is not sufficient to meet the "intention plus" test in Reemark. The court can take judicial notice of the fact that these types of expenditure would precede residential development projects of any size. The expenditure of these types of funds does not equate to "use for residential purposes" any more than would the expenditure of moneys for the acquisition of the lands or payment of taxes on the lands. There is no present use

6 of the lands for residential purposes acquired by surveys and testing done for the purpose of deciding whether or not to proceed with residential use. I turn now to the submission of the taxpayer that the regulatory regime and specifically the provisions of the restrictive covenant entered into between the taxpayer and the City mandate the "effective use of the lands to residential purposes". I cannot accept that proposition. The Regulation speaks of residential use. It does not speak of intention nor does it speak of contractual limitations like those contained in the restrictive covenant. The word "used" when applied in the context of the Regulation implies actual use beyond surveys and testing. It would seem to me that the construction of roads, sewers, waterlines and of course the construction of residential units would satisfy the words of Regulation 1(a) but mere testing and surveying would not even when combined with the additional factor of the execution of the restrictive covenant. I find myself in agreement with the dissenting opinion of the Board: The dissenter does not agree that the property is "used for residential purposes" within the meaning of the Regulation.. The dissenter is satisfied on the evidence that the property is "held" for residential purposes, but it is not yet so used. Despite the regulatory regime which will require a certain amount of residential use, until construction has commenced, the property is only "held" for residential use and not "used". If the legislature had intended Residential Class to apply to property otherwise zoned, but held for residential use, it would have done so expressly. Regulation 1(c): The next question to be decided is whether or not the lands may fall into assessment class 1(c) as: land having no present use and which is neither specifically zoned nor held for business, commercial, forestry or industrial purposes. In the case at bar the majority of the Board concluded that: The respondent and the dissenter have ascribed insufficient weight to the effect of the Restrictive Covenant. The Restrictive Covenant is stronger and more specific than the present zoning of TC- Town Center - which itself permits residential development. The Restrictive Covenant dictates the following usage: Residential - 1,027,000 sq. ft.; Commercial - 260,800 sq. ft.; Civic - 25,000 sq. ft. The majority of the Board goes on to say: It is seen that the scheme of development is overwhelmingly residential and the commercial component is not only incidental thereto but it provides an infrastructure beneficial to and for the benefit of the paramount residential development. The Restrictive Covenant is mandatory, is binding on the appellant, and is registered and runs with the land. It is therefore not only equivalent to zoning but is more restrictive than zoning. It was affected prior to the state and condition date. In Eccom Developments Ltd. v. Assessor of Area 9 - Vancouver, Stated Case (1989) 4 Stated Case 269 (B.C.S.C.) (Eccom) (B.C.C.A.) CA010419, Vancouver Registry, November 6, 1989 where Mr. Justice Cumming for the Court says at p :

7 It was common ground below that the land had no present use, and that it was held for residential purposes. In fact, by the time the case reached the Assessment Appeal Board, a residential building was under construction on it. The only issue before the Board, therefore, was whether the land was specifically zoned for business, commercial, forestry or industrial purposes and that is the only issue on this appeal. Mr. Justice Cumming, in response to the Appellant's argument that such zoning, (Downtown District) is general rather than specific in nature: that the word "specifically" in the Regulation must be restrictive,... after examination of dictionary sources he goes on to say: That the interpretation adopted by the chambers judge is the correct one may be tested not merely by these dictionary references (a test which, in my view, it passes) but by asking oneself: "Is the land specifically zoned for business purposes? Is the land specifically zoned for commercial purposes? Is the land specifically zoned for forestry purposes? Is the land specifically zoned for industrial purposes?" A reading of the by-law leads one to a clear answer in each case. He then goes on to conclude that: This leads me to the conclusion that the natural and ordinary meaning of the word "specifically" in section 1(c) is one of its recognized dictionary definitions, namely, "expressly" or "explicitly". So to interpret it is to give it full effect. Neither do I accept the contention that the interpretation adopted by the chambers judge conflicts with the object and purpose of the regulation nor that it produces an absurd result because virtually no vacant land could meet the test for residential classification. The majority of the Board came to the conclusion that by virtue of the Official Community Plan, the Zoning By-law and the Restrictive Covenant, a portion - the major portion - of the subject site is specifically zoned Residential and is held for residential purposes. That being so, that portion cannot be said to be held for business, commercial, forestry or industrial purposes and accordingly falls within section 1(c) of the Regulations as Class 1 - Residential. The dissenting opinion of the Board was to the effect that the Restrictive Covenant is not zoning and accordingly the lands are "specifically" i.e. "explicitly" zoned for a variety of uses. I again find myself in the position of agreeing with the dissenting opinion where it is stated: It seems to the dissenter that, although the ultimate development of the subject property will be according to the terms of the Covenant, the Covenant is not intended to take priority over the regulatory powers of the City in its zoning bylaws. None of the planned development may ever come to pass, and until the actual use of the property can be identified for classification purposes, the fact remains that the applicable zoning permits a variety of uses. In my view the word "zoned" in the Regulation means zoning pursuant to the provisions of the Municipal Act (or the Vancouver Charter) and it does not mean zoning by implication arising from the terms of a restrictive covenant. I have therefore concluded that the property may not be classified pursuant to Class 1(c) of the Regulation. Integrated Whole:

8 The Board's conclusion with respect to whether or not the lands were "part of an integrated whole, namely the Port Moody Town Centre is: In particular the subject is not on all fours with Newbury J. in Reemark because it is in fact part of an integrated whole, namely, the Port Moody Town Centre. When Newbury J. commented on whether or not the property in Reemark was part of an integrated whole the meaning that should be ascribed to her remarks arose from the decision of Proudfoot J. in Assessment Commissioner v. Robert G. McMinn (1981) 120 D.L.R. (3d) 382 where Madam Justice Proudfoot was faced with the question: Did the Assessment Appeal Board err in law in holding that "the land in question forms part of an overall integrated farming operation" when there was no evidence that the land outside the fenced area was used in or operated as part of the farm operation at all and there was no evidence that the land was "integrated" into the farm operation at all? The facts in that case were that the taxpayer owned 350 acres of land of which approximately one-third was fenced and actively farmed. The taxpayer gave evidence to the Assessment Appeal Board of his intention to develop farming on the remaining acreage in the future and the conclusion of Proudfoot J. was that the entire holding is an integrated farm operation and accordingly the farm classification was correctly applied to the entire holding by virtue of Regulation 288/79, paragraphs 1(2)(a) and 7. At the time of the McMinn decision Paragraph 7 read as follows: 7. Land may be classified as a farm where it consists of all or part of any parcel or group of parcels of land, contiguous or not, making up a tract of land owned or held under a written lease by a person singly or jointly with any other person or persons and operated as an integrated farm operation for primary agricultural production. In the case at bar the land is not sought to be classified as a farm nor can the land be said to be part of an integrated whole as that phrase is used in McMinn. The "integrated whole" referred to in McMinn was all of the farm property owned by McMinn, not part of the property owned by McMinn and part by others. In the result the Board's conclusion that because the lands are part of "an integrated whole or neighbouring or dominant land" thus distinguishing the Reemark case is erroneous. The lands in question in the case at bar are of common ownership and the "integrated whole" are those lands and not those lands and the Port Moody Town Centre. I have therefore come to the following conclusions: 1. The Board erred in law (in the decision of the majority) in its interpretation of B.C. Regulation 438/81, the Prescribed Classes of Property Regulation, by finding that the term "zoning" in the said Regulation included a restrictive covenant. 2. The Board erred in law in finding the expenditure of funds for a survey, soil testing, traffic counts, geotechnical work, retail market study and legal fees brought the case outside of the principles enunciated by this court in Reemark. 3. The Board erred in law in finding the property was "part of an integrated whole" namely the Port Moody Town Centre, and thereby distinguishing the decision of this court in Reemark.

9 4. Because of the findings with respect to the prior three questions it is not necessary for me to decide whether or not the Board erred in law in its interpretation of Section 1 and Section 10 of B.C. Regulation 438/81, the Prescribed Classes of Property Regulation. The Board shall direct the Assessor to make the necessary amendment to the assessment roll in accordance with this decision. The Assessor shall have its costs of and incidental to the Stated Case. SC 362cont Bosa Development Corporation v. AA12 APPLICATION FOR LEAVE TO APPEAL BOSA DEVELOPMENT CORPORATION v. ASSESSOR OF AREA 12 - COQUITLAM British Columbia Court of Appeal (CA020174) Vancouver Registry Before the HONOURABLE MR. JUSTICE GOLDIE (in chambers) Douglas H. Clarke for the Appellant John E.D. Savage for the Respondent Leave to Appeal -- Classification -- Fair Question To Be Tried Vancouver, June 13, 1995 The company sought leave to appeal the decision which found that the Board erred in its classification of undeveloped property as residential. HELD: The Appellant is raising issues respecting the interpretation of B.C. Regulation 431/81, Prescribed Classes of Property Regulation. That Regulation is actually or potentially at the threshold of every assessment. In this case, there is a fair question to be tried and accordingly, leave to appeal is allowed. Reasons for Judgment June 29, 1995 This is an application by Bosa Development Corporation ("Bosa"), an owner of real property in the assessment area in question, under s. 74(8) of the Assessment Act, R.S.B.C. 1979, c. 21 as amended. Leave is sought to appeal the decision of Mr. Justice Edwards, sitting as a judge of the Supreme Court of British Columbia, who heard and determined a case stated by the Assessment Appeal Board (the "Board"). The material facts stated by the Board are as follows:

10 1. The subject properties are three contiguous parcels forming a triangular shaped block of land in the proposed Port Moody Town Centre at the head of Burrard Inlet. The three lots are vacant and total approximately acres. 2. Prior to the 1992 Assessment Roll, the properties were classified Class 1 - Residential. On the 1992 Roll, the properties were given split classifications apportioning value between Class 1 - Residential and Class 6 - Business and Other. The Assessor appealed to the Court of Revision and the Court of Revision classified all three properties in their entirety under Class 6 - Business and Other. The property owner (Respondent herein) appealed that decision to the Assessment Appeal Board. 3. The values and classification of the subject properties as determined by the Court of Revision were: Roll No Lot 2 Land $1,734,000 Class 6 Total $1,734,000 Roll No Lot 23 Land $ 693,000 Class 6 Total $ 693,000 Roll No Lot 113 Land $6,243,000 Class 6 Total $6,243, The issue before the Assessment Appeal Board was the classification of the properties. 5. The subject parcels are vacant and are held for development purposes. 6. The applicable zoning is TC-1 - Town Centre One which permits a variety of land uses including multi-family residential, some commercial uses, and civic use. 7. The subject properties are subject to a Restrictive Covenant between the Respondent and the City of Port Moody. In the Restrictive Covenant, the Respondent agrees that the land shall not be used, built on or subdivided except in accordance with the terms of the Covenant. 8. There is a Development Plan for the subject site which is part of the Official Community Plan. The Development Plan provides for the phased development of the Town Centre site to create an environment of mixed land uses including multi-family residential, office and retail commercial and civic recreational.

11 9. The proposed development of Lot 2 provides for 90,000 sq. ft. of office use, 45,000 sq. ft. of retail use, and 25,000 sq. ft. of civic use. The proposed development of Lot 23 provides for 27,000 sq. ft. of residential use and 15,000 sq. ft. of retail use. The proposed development of Lot 113 provides for 1,000,000 sq. ft. of residential use, 35,000 sq. ft. of retail use, and 75,000 sq. ft. of office use. 10. As of the date of state and condition for assessment purposes, no application for a development permit had been made with respect to the site and no building construction had commenced. Some geotechnical work and soil studies had been done on the site, some legal and traffic surveys completed, and a retail market study done. 11. The majority decision of the Board found that the Restrictive Covenant dictated the following usage for the subject properties: Residential Commercial Civic 1,027,000 sq. ft. 260,800 sq. ft. 25,000 sq. ft. The majority decision of the Board found that the Restrictive Covenant is mandatory, is binding on the Respondent, is registered and runs with the land, and is, therefore, not only equivalent to zoning, but more restrictive than zoning. 12. The majority decision of the Board found that "there was something more than an intention" to use the property for residential purposes by reason of having entered the Restrictive Covenant and by having expended monies on the site by the survey, soil testing, traffic counts, geotechnical work, retail market study, and legal fees. 13. In the alternative, the majority decision of the Board found that by virtue of the Official Community Plan, the Zoning Bylaw, and the Restrictive Covenant, the major portion of the subject site is specifically zoned Residential and is held for residential purposes and falls within section 1(c) of Regulation 438/81, The Prescribed Classes of Property Regulation, as Class 1 - Residential. 14. The majority decision of the Board found that the following classifications shall apply to the subject properties: Roll No Lot 2 135,000 sq. ft. - Class 6 25,000 sq. ft. - Class 8 Roll No Lot 23 27,000 sq. ft. - Class 1 15,000 sq. ft. - Class 6 Roll No Lot 113

12 1,000,000 sq. ft. - Class 1 110,000 sq. ft. - Class 6 The questions stated by the Board are: 1. Did the Assessment Appeal Board ("Board") err in law (in the decision of the majority) in its interpretation of B.C. Regulation 438/81 The Prescribed Classes of Property Regulation by finding that the term "zoning" in the said regulation included a restrictive covenant? 2. Did the Board err in law in finding the expenditure of funds for a survey, soil testing, traffic counts, geotechnical work, a retail market study and legal fees brought the case outside the principles enunciated by this Court in Assessor of Area 10 - Burnaby/New Westminster v. Reemark XIII Developments Ltd. et al B.C. Stated Case 329? 3. Did the Board err in law in finding the property was "part of an integrated whole, namely the Port Moody Town Centre" and thereby distinguishing the decision of this Court in Assessor of Area 10 - Burnaby/New Westminster, supra? 4. Did the Board err in law in its interpretation of section 1 and section 10 of B.C. Regulation 438/81 The Prescribed Classes of Property Regulation? The Assessor, as a person affected by the decision of a majority of the Board, acted under s. 74(2) of the Assessment Act. Mr. Justice Edwards' decision was favourable to the Assessor and the applicant seeks to appeal the answers to questions 1, 2 and 4. I was advised it is not pressing the matter raised in question 3. The applicant's memorandum of argument addresses the factors considered in Royal Bank Realty Inc. v. Assessor of Area 10 (8 March 1991), Victoria Registry, VI01344 (B.C.C.A.). The Respondent's memorandum analyzed the application by reference to Queen's Plate Development Ltd. v. Assessor of Area 09 (1987), 16 B.C.L.R. (2d) 104 (B.C.C.A.). Both provide the means of establishing the position of the parties on the more generally expressed categories set out in paragraph 4 of the current Practice Directive regarding leave to appeal in civil matters. Both are agreed the grounds of appeal advanced by the applicant raise variations in the interpretation and application of statutory provisions. The Respondent's position is that no issue of general importance is raised and that the appeal lacks merit. The scheme of the Assessment Act is such that there are three appellate levels open to an owner who objects to a notice of assessment: the Assessment Appeal Board, the Supreme Court, and this Court. The legislature intended judicial scrutiny be confined to questions of law. Whether an issue raises a question of law or one of fact disguised as law or one of mixed fact and law is often a nice question. While the issues the applicant seeks to raise in the case at bar appear to be confined to the interpretation of B.C. Regulation 438/81, that regulation is, actually or potentially, at the threshold of virtually every assessment. Cf. New Westminster Chamber of Commerce v. Assessor of Area 10 - Burnaby/New Westminster (1993), 85 B.C.L.R. (2d) 175. I am of the view the issues raised are of general importance.

13 As I am going to grant leave to appeal I do not propose going into the arguments addressed to the merits of the appeal. I am satisfied there is a fair question to be tried. Leave is granted to appeal from the decision of the Supreme Court of British Columbia pronounced by Mr. Justice Edwards 6 March Costs will be in the cause. SC 362cont Bosa Development Corporation v. AA12 BOSA DEVELOPMENT CORPORATION v. ASSESSOR OF AREA 12 COQUITLAM & ASSESSOR OF AREA 09 - VANCOUVER v. BASTION DEVELOPMENT CORPORATION & AND YORKVILLE HOMES (III) INC. British Columbia Court of Appeal (CA020174/CA021118)Vancouver Registry Before the HONOURABLE MR. JUSTICE WILLIAMS (in chambers) D.H. Clarke for the Appellant J.E.D. Savage for the Respondent B.J. Wallace, Q.C. and J.D. Fraser for the Applicant (Concord Pacific) P.J. Scheer for the Applicant (City of Vancouver) Intervenors -- Taxing Jurisdictions -- Other Litigants Vancouver, September 25, 1996 Concord Pacific Holdings Ltd. (Concord), a company with a similar issue before the Assessment Appeal Board applied to intervene to present arguments which had not been raised by the Appellants previously or at the Court of Appeal. The City of Vancouver (the City) sought to intervene in the event that the company was granted Intervenor status. Concord's appeal dealing with a similar issue was delayed pending an appeal by the City in which the City was eventually successful. HELD: Application Allowed. 1. The criteria for permitting intervention is generally considered to be (1) an interest in the outcome, most frequently interpreted as a direct interest rather than simply concern about the effect of the decision, and (2) that submissions by the Intervenor may be useful and different from those of other parties; 2. The City of Vancouver has a right to intervene under the statute; 3. In intervention applications an applicant must establish more than the simple proposition that he or she will be affected by the outcome of a decision in another case by virtue of its precedential value. In this case special circumstances have been shown.

14 Reasons for Judgment (Oral) September 25, 1996 This matter involves two applications for intervenor status in these two appeals, one by Concord Pacific Holdings Ltd. and one by the City of Vancouver. As I understand it, the City of Vancouver's application is dependent on whether or not Concord is to be added as intervenor. Concord is the owner of Vancouver property formerly known as the "Expo Lands". At the time when Concord purchased that property the lands were specifically zoned, British Columbia Place - Expo District BCPED. Certain of those lands became rezoned to a Comprehensive Development District (CD-11) in accordance with the Official Development Plan (ODP). The balance of the lands continued to be zoned "residential lands". Concord and the British Columbia government were required to spend significant amounts of money removing contamination from the soil in the residential lands before they could be developed. Concord committed to spend a significant amount of money developing social housing sites, parks and open spaces, school sites and related infrastructure. The ODP specifically restricted long-term use of the residential lands to a specific proportion of the total square footage of those lands. During the years 1993 through 1996 Concord pursued and continues to pursue residential development of those lands to the maximum extent permissible under the terms of the ODP and the specific site zoning CD-1. In 1993 the Assessor classified 26% of the residential lands as (Class 6 - Business and Other) and 74% as (Class 1 - Residential). This of course is for the assessment of property tax. In 1994 the Assessor classified 10% of those lands as Class 6 and 90% Class 1. In % as Class 6 and 76% as Class 1. For the 1996 taxation year the Assessor classified 100% of those lands as Class 6 - Business and Other. The significance of the classification in this case is, of course, that the amount of tax which may be charged on Business and Other (Class 6) is approximately 4 times higher than for Residential (Class 1). The Court of Revision confirmed the Assessor's classification in each of the years. Concord appealed the Court of Revision decision to the Assessment Appeal Board (the Board) which commenced its hearing with respect to the 1993 and 1994 taxation years on April 10, The Board's hearings were suspended pending a decision of the British Columbia Supreme Court and then pending a decision of this Court, on a judicial review application brought by the City in the course of the hearings. That application dealt with a decision by the Board to take certain evidence in camera at the request of Concord. The Supreme Court, and then this Court, delivered their decisions (the latter in 1996) which resulted in the matter having to go back before the Board and the in camera evidence being returned to Concord. The Board has not yet reconvened the hearing, and accordingly, there has to date been no decision from the Board on the issue or issues which Concord has appealed from the Court of Revision. One of those issues, if not the most important one involves the interpretation of the words "used for residential purposes" where they appear in section 1(a) of the Regulations. The appeals, both Bosa Development Corporation v. Assessor of Area 12 - Coquitlam and Bastion Development Corporation and Yorkville Homes (III) Inc. v. Assessor Area 09 - Vancouver, both involve the same interpretation issue, that is to say the question of what lands are to be assessed under Classes 1 or 6 and, the criteria for that classification by the Assessor.

15 There is, in addition, a second issue on the interpretation of the words "specifically zoned under section 1(c) of the Regulations" although as I understand it, this issue may not be quite as important as the first one. Counsel for Concord argued that this is an extremely important matter which at maximum could involve as much as $13.5 million, a great deal hangs on the interpretation of section 1(a) and, to some extent section 1(c) of the Regulations. Counsel for Bosa Development Corporation and Bastion, the two Appellants in these appeals, supports the application by Concord and considers that they could assist the Court in its determination when the matter comes on next week. Counsel for the Respondent Assessors opposes the application on the grounds that Concord is not directly affected by the decision in Bosa and Bastion but only that may be affected by the precedent which the Court of Appeal might establish. Counsel for the City of Vancouver takes no position either for or against the application but indicates that if Concord is permitted to intervene the City too would want to intervene in case some aspect of Concord's submission might bear on the City's position. I have, fortunately, had two good counsel presenting well prepared arguments on this issue and I have reviewed the leading cases which they have cited. These cases include B.C. Fed of Lab. v. B.C. (W.C.B.) (1988), 29 B.C.L.R. (2d) 325 (B.C.S.C.); Canadian Labour Congress v. Bhindi and London (1985), 61 B.C.L.R. 85 (B.C.C.A.); MacMillan Bloedel Ltd. v. Mullen et al, [1985] 3 W.W.R. 380 (B.C.C.A.); Guadagni v. W.C.B. (1988) 30 B.C.L.R. (2d) 259 (B.C.C.A.); The Milk Board v. Bar Cheese Ltd. (10 August 1990), Vancouver CA (B.C.C.A.); Ontario (Attorney General) v. Dieleman (1993), 16 O.R. (3d) 32 (Gen. Div.) and Scofield v. Ministry of Consumer and Commercial Relations (1980), 29 C.P.C. 245 at 248 (Ont. C.A.); Assessor of Area 10 - Burnaby/New Westminster v. Reemark XIII Developments Ltd. et al (1992), B.C. Stated Case 329 (B.C.S.C.) at 1913; The Ronald McDonald House TM Society of British Columbia v. Assessor of Area 09 - Vancouver (1984), B.C. Stated Case 178, (B.C.C.A.) at ; Eccom Developments Ltd. v. Assessor of Area 09 - Vancouver (1989), B.C. Stated Case 269 (B.C.S.C.) at I have also considered the supplementary book of authorities filed by Concord which includes the cases of Assessor of Area 09 - Vancouver v. Bramalea Limited (17 May 1990, Victoria Registry VI00992 (B.C.C.A.)); [1990 B.C.D Civ digest]; (1995), 10 B.C.L.R. (3d) 92 (B.C.C.A.) and Vancouver Assessor, Area 09 v. Lount (1995), 15 B.C.L.R. (3d) 359 (B.C.C.A.). I have also reviewed the two judgments of the trial division in both Bosa and Bastion. Those decisions both relied on the decision of Newbury J. (as she then was) in Burnaby v. Reemark XIII Developments Ltd., supra. The Reemark case held that there must be something more than an intention to use the property for residential purposes in order to qualify under Regulation 1(a) "used for residential purposes". I have found the cases helpful in my determination but need not deal with their direct application since the facts of this case are, as so often is the case, quite different. Also, it is not for me to comment on the issue which will come before this Court October 3, but only to determine whether this is an appropriate case to allow Concord and the City of Vancouver to intervene. I have also considered the supplementary book of authorities filed by Concord which includes the cases of Assessor of Area 09 - Vancouver v. Bramalea Limited (17 May 1990, Victoria Registry VI00992 (B.C.C.A.)); [1990 B.C.D Civ digest]; (1995), 10 B.C.L.R. (3d) 92 (B.C.C.A.) and Vancouver Assessor, Area 09 v. Lount (1995), 15 B.C.L.R. (3d) 359 (B.C.C.A.). Mr. Wallace argues that in Bosa there is a development in progress (even if not under construction) which has reached a certain stage and that the zoning is comprehensive but subject to a registered restrictive covenant which represents the agreement between the Developer and

16 Point Moody. In the Bastion case, again, there is a development in progress and a CD-1 zoning. In the case of Concord a residential project is underway in the sense that Concord is proceeding with the legal and administrative aspects. Mr. Wallace argues that the very essence of what they have been trying to have determined by the Board and, perhaps ultimately the courts is the interpretation issue which will now be decided by this Court in the Bosa and Bastion case. By reason of the diversion, being Vancouver City's appeal of the in camera evidence matter, Concord has not had the opportunity of arguing its position on this most important matter before the Court. It can of course, after the matter has been taken through the Board, take the matter to the court if not satisfied with the Board's decision and is free to argue that and other issues at that time. Its concern of course is that this Court's decision may well be sufficiently broad to foreclose argument on "used for residential purposes" even though it would not be res judicata. Mr. Wallace argues in addition that if the court's decision were favourable to it then it would not be necessary to carry that issue through the Board or the courts. Mr. Wallace points out that this Court decided the Ronald McDonald case in favour of the taxpayer on what he claims is an analogous argument. That case was apparently not brought to the attention of the trial judge nor was it in the Appellant's factum in these cases. That case, however, and the new argument which it brings to bear was brought forth by Concord. In that regard, and Mr. Wallace claims Concord can contribute to the discussion before the court. In addition, Mr. Wallace will argue that while Reemark may be correct in saying that intent alone is not enough, construction does not have to be commenced. Finally, Concord contends that assessment appeals are done under a public statute and are not simply a civil suit where one advances a claim against another. Mr. Savage relies heavily on the Eccom, supra, decision and argues that there is a very significant difference between property which is held for residential use and property which is used for that purpose. Mr. Savage argues to distinguish the Bramalea case that there was a new issue brought forth, and in the Lount case, there was no objection to Mr. Wallace's intervention since the taxpayer was appearing on his own behalf. The essence of Mr. Savage's concern is that should the court permit another developer such as Concord to intervene in this case, it would open the door for interventions on numerous taxpayer appeals, not where there is a direct interest at stake but where they may simply be affected by the decision. The criteria for permitting intervention is generally considered to be: (1) an interest in the outcome, most frequently interpreted as a direct interest rather than simply concern about the effect of the decision, and (2) that submissions by the Intervenor may be useful and different from those of other parties. In that regard Mr. Justice Sopinka, in Re Workers' Compensation Act, 1983 (NFLD.) on a motion for intervention before the Supreme Court of Canada said this:... I agree with Pigeon J. that any interest extends to an interest in the outcome of an appeal when a legal issue to be determined therein will be binding on other pending litigation to which the applicant is a party. Although this is usually a tenuous basis upon which to base an application for intervention, in this appeal Mr. Cowper's client is in the unenviable position of facing an opponent in the British Columbia litigation, the A.G. of B.C. who has the right to intervene in this appeal. There is an aura of unfairness about this which should be remedied by granting this application unless the other criteria dictate the contrary conclusion... This criteria is easily satisfied by an applicant who has a history of involvement in the issue giving the applicant

17 an expertise which can shed fresh light or provide new information on the matter.... An intervention is welcomed if the intervenor will provide the court with fresh information or a fresh perspective on an important constitutional or public issue. Certainly, Concord is interested in its own property tax bill, it is not a governmental organization applying on behalf of a wide group of citizens. On the other hand, it is clear that this issue is an extremely important one as well to the Assessor, the City of Vancouver, which has every right to intervene under the Statute (as the A.G. does in Re Workers' Compensation, supra) and is of real interest to a large number of developers throughout the province. Concord has been "living" with this issue and has a great deal of expertise in the background as well as its new argument based on the Ronald McDonald case. I must say, however, that now that that case is disclosed it could be equally argued by Mr. Clarke on behalf of Bosa and Bastion. In addition, it seems somewhat unfair that the very issue which Concord has been pursuing might be decided in their absence by virtue of the City of Vancouver's appeal which has put their case behind the schedule of the others. In addition, it is quite possible that the decision may go the other way in favour of Bosa and Bastion. If that should occur, then notwithstanding the special zoning and different arguments that might be available for or against Concord, it may well resolve their issue and make it unnecessary for Concord to have to proceed before the Board and/or the Courts. Finally, Mr. Wallace promises that his intervention will not extend matters by more than one hour at the hearing scheduled for 3 October In addition, of course, the City of Vancouver may find it necessary to respond which may add some time to the estimated hour. In intervention applications such as this one the applicant must establish more than the simple proposition that he or she will be affected by the outcome of a decision in another case by virtue of its precedential value. I am satisfied in this case that Concord has established a number of special circumstances which distinguish it from the applicant, for example, in the Scofield case, and, accordingly, I would allow the application. Concord shall be permitted to intervene in these appeals and must file its factum no later than Friday, 27 September 1996 or in the alternative it may consider the submission that has been made here as its factum. I would also order that the City of Vancouver be permitted to intervene and that it file its factum by Friday the 27 September SC 362cont Bosa Development Corporation v. AA12 BOSA DEVELOPMENT CORPORATION v. ASSESSOR OF AREA 12 - COQUITLAM British Columbia Court of Appeal (CA020174) Vancouver Registry

18 Before the HONOURABLE MR. JUSTICE LAMBERT, the HONOURABLE MR. JUSTICE ESSON, and the HONOURABLE MADAM JUSTICE PROWSE D.H. Clarke for the Appellant J.E.D. Savage for the Respondent B.J. Wallace, Q.C. & J.D. Fraser for the Intervenor Concord Pacific Holdings Ltd. P.J. Scheer for the Intervenor City of Vancouver Vancouver, October 3, 1996 Classification -- Residential or Business and Other -- "Specifically Zoned" -- Development Property -- Expenditure on Soil Studies, Marketing, etc. -- Property Subject to Official Community Plan -- Property Subject to Restrictive Covenant The sole issue in the appeal was the classification of the property under the Prescribed Classes of Property Regulation. The Board classified the property as primarily Class 1, Residential, on the basis that most of the intended development was Residential. The amount of residential development was a virtual certainty because of the Restrictive Covenant and Official Community Plan. In addition, the owner had expended substantial funds in furthering its residential development plans. The owner was a developer and intended to develop the property with condominiums and some limited retail/commercial space. On appeal the BC Supreme Court allowed the Assessor's appeal, and held that the proper classification of this undeveloped property was Class 6, not Class 1. The owner appealed to the Court of Appeal. HELD: Appeal dismissed. 1. The property was not used for residential purposes despite the expenditure of funds. Property is used for residential purposes when people reside on it, or if it is used for purposes which are normally ancillary to use for residential purposes, e.g., gardens, lawns, tennis courts and the like. It is less clear whether property is used for residential purposes when buildings are under construction but not ready to be occupied. Whether that is so remains to be decided; 2. The property was specifically zoned commercial. The term "zoning" in the regulation refers to zoning under the Municipal Act not to the Official Community Plan or the Restrictive Covenant. While the Restrictive Covenant and Official Community Plan make it virtually certain that, if the project is completed as planned, it will be used primarily for residential purposes, the zoning on the property precludes it from falling within s. 1(c) of the Prescribed Classes of Property Regulation; 3. If property held for residential development was to receive the benefit of falling within Class 1 the Legislature could easily have accomplished that result expressly. Reasons for Judgment December 23, 1996 Written Reasons by: The Honourable Mr. Justice Esson Concurred in by: