IN THE SUPREME COURT OF BRITISH COLUMBIA

Transcription

1 IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Sahlin v. The Nature Trust of British Columbia, Inc., 2010 BCSC 318 Date: Docket: S Registry: Vancouver In the Matter of the Partition of Property Act, R.S.B.C. 1996, c. 347 And In the Matter of the Lands and Premises known and described as PID: , District Lot 1375 Group 1 New Westminster District Between: And Roger Sahlin, Gerryanne Sahlin, Carl Roger Sahlin Jr., Christopher Lane Sahlin and Sigrid Anne Sahlin (Hoag) Petitioners The Nature Trust of British Columbia, Inc. Respondent Before: The Honourable Mr. Justice Rice Reasons for Judgment (In Chambers) Counsel for the Petitioners: Counsel for the Respondent: Place and Date of Hearing: Place and Date of Judgment: Bill Kaplan, Q.C. and Jeffrey L. Oliver Herman Van Ommen Vancouver, B.C. February 3, 2010 Vancouver, B.C. March 12, of 11 3/21/10 7:31 PM

2 [1] This is a proceeding pursuant to the Partition of Property Act, R.S.B.C. 1996, c. 347 (the Act ) for partition of a parcel of 330 acres of land (the Savary Land ) on Savary Island, British Columbia. The parties own the property together, each of them holding a one-half undivided interest jointly or in common with the other. INTRODUCTION [2] Mr. Kaplan for the petitioners seeks a partition of the Savary Lands into four parcels of which each party would take two according to a plan, Map 1. If the Province of British Columbia should realign the main road so that it crosses the Savary Lands,bisecting the four new parcels, Each party would cooperate to extend the partition to divide each new parcel into two parcels thus creating four new parcels each [3] Mr. Van Ommen for the respondent submits that instead of partition, the whole of the Savary Lands should be sold on the open market, where his client would hope to purchase it. If a sale is not approved then the respondent is agreeable to a subdivision pursuant to another plan submitted by the petitioner known as Map 3. [4] The petitioners submit that there is no jurisdictional impediment to subdivision of the Savary Lands into more than two parcels. The Partition Act is silent on the question, but its wording clearly allows for the broader interpretation. Hence, I declare that this court has jurisdiction to grant the partition of the Savary Lands into two or more parcels, as provided in either of the petitioner s Map1 and Map 3 plans for partition. [5] The petitioners are the members of a family based in Washington State and the Respondent, The Nature Trust of British Columbia, Inc., is an extra-provincial society incorporated pursuant to the laws of Canada. Its members purport to follow as a mission the acquisition and conversation of land where, in their view, it has some bio-diversity value. The Sahlins, although they have no direct connection with the respondents, they profess to share their desire to partition in an environmentally sensitive manner. [6] However, environmental issues are not considered by the parties as determining factors on this application for partition or sale. This court has made no environmental findings of fact. The mechanisms in dealing with those issues are available within subdivision process and efficient community plan. [7] However, this court will retain jurisdiction to decide all matters arising between the parties concerning this partition of the Savary Lands 2 of 11 3/21/10 7:31 PM

3 SAVARY LANDS [8] The property offers ocean frontage along both sides of the Island, that is, about 5915 feet along the north shore and 6317 feet along the south shore. The north shore has deep and densely forested embankments overlooking a sandy beach. It has poor sun exposure, and mud flats that often give off unpleasant smells of decaying material. It is damp and cool, and not conducive to comfortable walking on the beach at high tide. [9] The official community plan for the area requires the building of set-backs of 50 to 150 feet along the north shore due to the high bank erosion. The Duck Bank area along the south coast has a more gently sloping terrain with intermittent grasslands on the beach. Toward the west portion around Beacon Point, the land rises again to form high sand bluffs above the beach. The south coast has stronger winter storms, but offers excellent panoramic views toward Vancouver Island and Beaufort Mountain Range. It is much sunnier than the north shore, and allows for waterfront beach access and has less dense foliage. [10] A road called Vancouver Boulevard dissects the Savary Lands. The parties initially expected that this road would be closed and relocated to the south, but recent communications suggest that instead, the Ministry will require Vancouver Boulevard to remain where it is. Savary Island Road in the north may be extended across the property. [11] There are three general areas on the Savary Lands which both parties agree are environmentally sensitive. They are: a. The Meadow Duck area located near the southwest shore of the Land, an area of approximately 2.33 acres. It is said to contain unique and sensitive plant life. b. A live foredune area on the south shore on the easterly portion of the Savary Land at Duck Bay. This is the most sensitive area on the Savary Land. It is a live foredune complex and also contains unique and sensitive plant life. Its area is about 3.7 acres in size. The dunes in the east sensitive area are called live dunes, and to the west a large portion (44.38 acres) is described as the Inland Relict Dunes c. A 3.10 acre area of bracken fern and other flora and fauna located at the south west corner near the Beacon Point area. The respondent has been frequently informed by the petitioners of the need to set up protective measures required to prevent a heavily invasive plant species from overcoming the existing vegetation in that area. CHANGE OF OWNERSHIP [12] On or about March 12, 2002, the Sahlins' co-owner Mr. Syre transferred his 50% 3 of 11 3/21/10 7:31 PM

4 interest in the Savary Land to the respondent without notice to the Sahlin Family. Roger Sahlin learned of the transfer through a press release. Since then, the petitioners have made numerous offers to the respondent in the hope that the parties could co-operatively separate their interests in the property. [13] Roger Sahlin always considered the Beacon Point area of Savary Land to be the most desirable and attractive area on the Savary Land, if not the entire island. The Sahlin Family had hoped to build summer three homes for family members in the Beacon Point Area, subject of course to retaining expert assistance to obtain permits to build on ecologically appropriate sites. The Sahlins say that they have attempted to work out a consensual partition through compromise, but so far without any success. LEGAL PRINCIPLES [14] Section 2 of the Partition of Property Act, R.S.B.C. 1996, c. 347 [Partition Act], grants the Court the power to compel a partition or sale of jointly held property: 2(1) All joint tenants, tenants in common, coparceners, mortgagees or other creditors who have liens on, and all parties interested in any land may be compelled to partition or sell the land, or a part of it as provided in this Act. (2) Subsection (1) applies whether the estate is legal or equitable or equitable only. [15] Co-owners have a prima facie right to the partition or sale of land unless justice requires that such an order should not be made. See Harmeling v. Harmeling, [1978] 5 W.W.R. 688, (B.C.C.A.) [Harmeling] at para. 10. The petitioner submits that this principle is fundamental to the Court s adjudication of the Partition Act. [16] The petitioners submit that the respondent knew that it was purchasing a one-half undivided interest in the Savary Lands and knew that it must share a control equally with the Sahlins. Not having consulted the Sahlins beforehand, the respondent must be deemed to have anticipated disagreement, and a potential that an application such as this would be made in the foreseeable future. [17] In a partition, perfect fairness is not always possible, and so in deciding between competing proposals for partition, the Court must strive to effect the most beneficial course for all parties with regard to their legitimate interests. See Jabs Constructions Ltd. v. Callahan, [1991] B.C.J. No (S.C.) and Davies v. Quaggan, [2002] B.C.J. No (S.C.). [18] Section 6 gives the Court a discretion to order or not to order a sale of jointly held lands as an alternative to partition. 4 of 11 3/21/10 7:31 PM

5 6. In a proceeding for partition where, if this Act had not been passed, an order for partition might have been made, and if the party or parties interested, individually or collectively, to the extent of 1/2 or upwards in the property involved request the Court to direct a sale of the property and a distribution of the proceeds instead of a division of the property, the Court must, unless it sees good reason to the contrary, order a sale of the property and may give directions. [19] I find nothing in the evidence in the evidence before me that would preclude subdivision into four lots under either plan. GOOD REASON [20] The petitioners insist that good reason exists in this case on the evidence. [21] In Bradwell v. Scott (2000), 81 B.C.L.R. (3d) 210 (C.A.) [Bradwell], the British Columbia Court of Appeal stated at para. 35: There is no requirement under s. 6 either as a condition precedent to jurisdiction or otherwise for the Petitioner to prove that he comes to Court with clean hands and is otherwise entitled to equitable relief. The section says that the Court must order sale of the property...unless it sees good reason as to the contrary. This language is neutral in terms of onus. It is for the Court to assess the evidence and to determine whether justice requires that such an order be denied. In practical terms, it would be for those opposing the application to put before the Court evidence attempting to establish a good reason for refusing it. In any event, I can see nothing in the statute or in the cases decided under it to support the Scott s submissions. [emphasis added] [22] The principle was followed by this Court in Hayes v. Schimpf, 2004 BCSC 1408 at para. 53. [23] Accordingly, the petitioners have emphasized that the so-called onus on it, is not a legal onus in the usual sense. [24] It is more of a practical burden of submitting some evidence upon which the Court may, in exercising its discretion, determine whether there is good reason to order partition rather than a sale. [25] The petitioners submit that the evidence shows good reasons for refusing to order a sale, and that a partition is to be preferred. The evidence in support comes from the following sources: the history of ownership of each party; the use objectives of both parties; the ecological benefit of maintaining ownership of the Savary Land with these 5 of 11 3/21/10 7:31 PM

6 parties (which is evidence the respondent could not refute); the financial circumstances of the parties; the financial realities facing the parties and the Savary Lands if a public sale is ordered; the ease of a partition, and the equities respected by the petitioners throughout. [26] The petitioners submit that the respondent offers no evidence as to why a sale would be preferred to a partition, other than by implication from its undisguised objective of acquiring all of the Savary Lands if it can for conservation purposes, an objective which, according to the petitioners, is illegitimate in a partition action. The Court in Bradwell also addressed this issue. [27] The respondent in Bradwell argued that the trial judge erred by deciding that the sale of the property would not occasion serious hardship upon the respondent, and that therefore there would be no good reason not to grant an order for sale. The respondent argued that the discretion of the Court not to grant an order for sale was not restricted to instances of serious hardship. Finch J.A. agreed with the submission while dismissing the appeal on other grounds. [28] From this, the petitioners submit that good reason means good reason of whatever sort. In other words, the discretion is broad and unfettered. The petitioners offer three principles on the basis of the authorities. They are: a. firstly, that the Act may not be utilized and must not condone the compulsory taking of land of one owner by another co-owner; b. secondly, both parties should be entitled to the full protection of their ownership rights as can be provided by the Court in a context of any application; c. thirdly, there must be a compelling and irrefutable good reason to avoid a sale if the facts demonstrate that the land is capable of being partitioned on an equitable basis in consideration of the parties actual legal rights in and to the lands. [29] The petitioners say that the respondent s strategy to press for a sale of the whole of the Savary Lands, hoping to be able to out-bid other interested buyers, is reckless. While it may be that the respondent intensely desires the chance to bid on the whole property, it remains to be seen whether it can raise the funds, and the likely scenario if it cannot, could be a disappointment, and possibly a disaster. 6 of 11 3/21/10 7:31 PM

7 [30] An open market buyer might have none of the values and objectives now shared by the respondent and the petitioners for land use and ownership. In short, an order for sale of the Savary Land as one parcel will present a material prejudice to both parties. [31] The respondent has given notice that it has now been authorized to offer to purchase the petitioners interest for $5 million, which, they maintain, is the market value. The offer includes also a provision for a lease back or dedication of the whole of the Savary Lands to the Provincial Government to create a wildlife park. However, the offer has yet to be presented, and therefore, there is no reason to consider it, and in fact, Mr. Kaplan for the petitioners calls the gesture mischievous and illegitimate, citing Hersog v. Hersog (1978), 5 B.C.L.R. 354 (S.C.) and Lougheed Enterprises Ltd. v. Armbruster (1992), 73 B.C.L.R. (2d) 353 (B.C.C.A.) at para. 17. THE SAHLIN FAMILY PROPOSALS [32] The petitioners desire strongly not to have to sell their interest in the Savary Lands. They wish to build summer cottages for various members to enjoy their time there. There is no evidence of any intention to despoil the environment in the process. [33] Map 1 provides an equal division of the north shore and south shore and an equal division of the western segment and eastern segments of the Savary Land. It gives the respondent the Beacon Point area (which is the area most desired in the Sahlin Family). It allocates to the Sahlins as well 62.1% of the Inlet Relict Dunes, almost all of the BGA Area and, and the east sensitive area. [34] Specifically it would provide 2,959 feet each of shoreline on the north shore, 3,165 each on the shoreline of the south shore and approximately 165 acres each of the Savary Land. [35] Initially, Mr. Wilson conducted an appraisal of Map 1 on the basis that Vancouver Boulevard was relocated, and then separately on the basis that it was not. Assuming the road was not relocated, it was valued at $8,000,050 for the petitioners and $7,000,940 for the respondent. With the Boulevard relocated, the partitioned property was worth $8,550,000 to the petitioners and $8, to the respondent. [36] In his December 21, 2009 appraisal, Mr. Wilson considered the effect of dedicating Vancouver Boulevard. He found that with respect to Map 1, and assuming that Vancouver Boulevard was dedicated in its existing alignment, the value accruing to each party, in his opinion, was $7,922,000 to the petitioners and $7,980,013 to the respondent. The new appraisal was conducted on the basis that the portion of the south shore that was cut off by the road dedication should be valued as north shore high bank waterfront rather than walk-on 7 of 11 3/21/10 7:31 PM

8 waterfront. It was determined that such dedication would reduce the frontage of each party s parcel by approximately 35 metres each. As that was equally borne by the parties, there was no value adjustment required even though it was found that the dedication of the Duck Bay public access would have some impact on the immediately adjoining lands with respect to decreased privacy and increased public traffic. [37] Assuming both the dedication of Vancouver Boulevard and the extension of Savary Island Road, the conclusion was that the two most south easterly parcels of the Savary Land would be most heavily impacted, but this impact would be more or less equal. Therefore, it was concluded that the value estimates under this scenario would be the same as the value estimates noted above with respect to the dedication of Vancouver Boulevard. [38] The petitioners submit, therefore, that Map No. 1 provides the parties with the best choice of partition alternatives. It provides equal acreages and shorelines, it divides the premium south west corner of the Savary Land, and each resulting parcel is practically equal in value. The discrepancy in value between the parcels is only $114,000 in favour of the petitioners. [39] Mr. Van Ommen drew particular attention to the inter-connectedness and sensitivity of the Savary Island eco-system in the Inland Relict Dunes. Observing that all of those dunes would lie within one contiguous parcel, as would the east and west sensitive areas, and the B and G areas. Mr. Kaplan challenged the assumption that keeping a sensitive area within one parcel provides better protection. There was no evidence to support the assumption, in my view. [40] Map 3 provides the petitioners with Beacon Point, the north east portion of the Savary Lands, and Whalebone Point. It provides that the respondent with the northwest portion of the Savary Land and the majority of the south shore walk-on waterfront. [41] The division of lands pursuant to Map 3 is as follows: a. Nature Trust 165 acres with north shore frontage of 2,957 feet and south shore frontage of 2,919 feet. b. The Sahlins would receive 165 acres of which 2,958 feet would be north shore frontage and 3,403 feet would be south shore frontage, of which 820 feet would be high bank. [42] The petitioners obtained two appraisals of Map No. 3, the first dated September 21, Assuming the existing Vancouver Boulevard would be closed and relocated to the north, the appraisal determined values to each party of $4,870,000 to the petitioners and 8 of 11 3/21/10 7:31 PM

9 $4,600,000 to the respondent. On December 21, 2009, Map No. 3 was revisited with the assumption that Vancouver Boulevard would not be closed and that a secondary access route would be dedicated through an extension of Savary Island Road. In both scenarios it was concluded that a value attributable to the parcels would be $4,358,000 to the respondent and $4,518,000 to the petitioners, the difference being $160,000 in favour of the respondent. [43] It was determined in arriving at those values, the dedication of Vancouver Boulevard would impact parcels owned by both petitioners and respondent in the south easterly portion of the Savary Lands through a reduction in privacy and enjoyment of the unobstructed waterfront. Due to the set-backs and road location, portions of both of those parcels are unlikely to have building sites on the waterside of the road allowance. Specifically, it was determined that approximately 200 acres of the respondent s parcel in the south east portion of the Savary Land would be affected, and the entire area frontage of the petitioners south east parcel would be affected. Even if those areas would otherwise be walk-on beachfront, it was determined that they should be treated as high bank waterfront property for valuation purposes. [44] With respect to the Duck Bay public access dedication, as it appeared that the dedication was equally split between the parties parcels, Mr. Wilson determined that there was no value adjustment required. [45] Both parties have also tendered environmental evidence with respect to Map 3. Pursuant to an October 1, 2009 Order of the Court, the Respondent was to deliver any reply evidence to the Petitioner s Map 3 appraisal by December 1, Further to that Order, the Respondent delivered the November 26, 2009 Affidavit of Carmen Cadrin, who is a vegetation ecologist with the Ministry of the Environment. Ms. Cadrin raises a number of issues with respect to the alleged ecological sensitivity of the Beacon Point area. Ms. Cadrin noted that the old forest located on Beacon Point has ecological and biodiversity value as compared to the other younger forests on the Island. She noted that a variety of Evening Primrose grows over a large area of Beacon Point, Whalebone Point and Duck Bay. On the contrary, the petitioners expert deposes that most of the old growth forest lies in the Beacon Point area, a distance of about 1,700 metres. He deposed that the Evening Primrose does not grow on Beacon Point. However, they exist and are located on the right-of-way belonging to the Ministry around Duck Bay. CONCLUSION [46] I find that there is good reason not to order a sale. I share the concern that a sale could take the property out of the control of both of these responsible owners and into the hands of a 9 of 11 3/21/10 7:31 PM

10 purchaser sharing none of the ecological sensitivities of the parties. Further I accept the petitioners submission that such a process would force a sale of the petitioners property, a step not to be lightly considered inasmuch as it bears resemblance to an expropriation. [47] Neither proposal is essentially unfair, but I find that the Map1 proposal is the fairest and the more equitable of the two. Its configurations provide a closer to equal aggregate value and a better sharing of the whole of the lands. Map 3 provides the respondent with much more of the south shore and the petitioner with much more of the high bank north shore, which is disadvantageous and not as fair to the petitioner. [48] Map 1 divides the premium southwest corner between the two parties, and the petitioners have expressed a willingness to allow the registration of two covenants to protect conservation of those parts of the sensitive areas located on their area as shown on Map 1. [49] Mr. Van Ommen, for the respondent urges upon the Court that there is significant advantage in Map 3 because, it keeps all of the Inland Relic Dune system and both the East and West Sensitive areas within one contiguous parcel. [50] Mr. Kaplan, for the petitioners challenges the respondent s assumption that having the sensitive areas in one parcel would protect them better from depredation, I agree that the evidence does not establish the basis for the assumption. [51] The reason for the lower aggregate land value under Map 3 as compared to Map 1 is that the further subdivision of the land into eight parcels under Map 1 causes the land values to rise. However, arguably this does not reflect corresponding and environmental cost associated with a partition according to Map 1. [52] The petitioners maintain that a Map 3 configuration would attract more opposition from the respondent in the event of the petitioners later applying for building permits and environmental approvals, particularly on the Beacon Point Area. If the Court approves Map 3, say the petitioners, it will result in fewer court battles. The respondent answers by saying that there is plenty of room as well for court battles over attempts to further subdivide Map 1. With no more than conjecture of counsel to guide me, I would call the argument on that last point a tie. [53] I order that the Savary Lands be partitioned into four separate parcels pursuant to the Map 1 plan submitted by the petitioner, or eight parcels if road realignment across the resulting new parcels necessitates it. [54] The parties will share the costs of sub-division including all preparation of documents and plans, approvals, and filings, but not including the costs of this proceeding, which will be 10 of 11 3/21/10 7:31 PM

11 determined on application, and failing application within one month of the date of these reasons then they too will be borne equally by the parties. The Honourable Mr. Justice Rice 11 of 11 3/21/10 7:31 PM