It is clear from the decision In Abbotsford (City) v. Weeds Glass & Gifts Ltd., 2016 BCSC 135 [Weeds Glass], that a local government may refuse to grant a business license on the ground that the business is engaged in unlawful activity.

In this decision, the Supreme Court of British Columbia granted the City of Abbotsford (the "City") a permanent injunction against Weeds Glass & Gifts Ltd. (the "Company"), which had been operating a business in Abbotsford without a valid business license from the City.

The Company, and its predecessor the Canadian Weed Cannabis Society (the "Society"), operated a marihuana dispensary which engaged in the retail sale of cannabis and cannabis related products contrary to the Controlled Drugs & Substances Act, S.C. 1996 , c. 19 (the "CDSA").

It was not disputed by the Company or the Society that in order to carry on business in Abbotsford, a valid business license, or an exemption to it, is required by the City's "Consolidated Business License Bylaw, 2006" (the "Bylaw"). The Company and the Society further conceded that they had failed to obtain such a license or exemption under the Bylaw to operate the dispensary.

The City had previously rejected an application by Mr. Briere, the sole director and officer of the now dissolved Society, for a business license to operate the dispensary on behalf of the Company and the Society. The City rejected Mr. Briere's application for a license on the basis that the retail sale of marihuana is not lawful, and would contravene section 5.9 of the Bylaw, which requires a person who carries on business in the City to comply with all applicable federal and provincial laws.

The Company continued to operate the dispensary despite a failure to obtain a business license or an exemption to the license requirement, and despite numerous warnings by the City to shut the dispensary down. Ultimately, the City applied to the Court for an injunction enjoining the Company from operating without a business license.

The Court held that the City has a statutory right under section 274 of the Community Charter, S.B.C. 2003, c. 26, to bring the injunction application and the grounds on which the Court may decline to grant the injunction are much narrower than where injunctions are sought based on common law. Being satisfied that the City had met the necessary requirements to support the injunction, the Court granted the City a permanent statutory injunction against the Company.

While the Court did not grant an injunction against the Society, as it had been dissolved and no longer existed in law, it granted a permanent injunction against every director, officer, liquidator, and member of the Society, as is statutorily authorized pursuant to section 135 of the Society Act, R.S.B.C. 1996, c. 433.

This case shows that the Court will rarely refuse a local government's statutory injunction application where a business continues to operate in clear violation of a business license bylaw. This case leaves unresolved the legality of marihuana dispensaries operating in compliance with business licences but contrary to federal law.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.