Outstanding insights were on offer at the B.C. Real Estate Litigation Roundup and networking reception held recently at our Vancouver office. McCarthy Tétrault's Jill Yates, Alex Cocks, and Connor Bildfell were joined by Ali Al-Ahmad, Senior Managing Director at FTI Consulting, and Nathan Nottingham, Director of Valuation at Ryan ULC. They provided valuable insights and perspectives on recent trends and flagged potential future hot spots in B.C. real estate litigation.
Here are some of the key takeaways.
1. Navigating Squatters and Vacant Possession
The presence of squatters can pose a significant hurdle in reclaiming vacant possession of property. We discussed the importance of acting swiftly to seek an injunction — a two-attendance court process that can effectively remove unauthorized occupants. Overholding tenants present a different scenario, requiring an Order of Possession from the Residential Tenancy Branch (RTB), followed by a court-registered Writ of Possession. Dealing with the RTB involves strategic planning to navigate through hearings, decisions, and potential judicial reviews.
2. Proactive Strategies for Construction Disputes
Construction disputes can derail projects and drain resources. The session highlighted three key strategies to mitigate the risks of delays and budget overruns:
- Engage in proactive and realistic planning.
- Address delays immediately as they arise.
- Maintain meticulous records throughout the project lifecycle.
3. Air Rights and Crane Swings – Case Law Developments
The B.C. Supreme Court has clarified the legal stance on crane swings over neighbouring properties. A 2020 case, OSED Howe Street Vancouver Leaseholds Inc. v. FS Property Inc., 2020 BCSC 1066 (CanLII), reaffirmed that unauthorized crane swings constitute trespass. More recently, Witmar Holdings Ltd. v. Stober Construction Ltd., 2023 BCSC 1378 (CanLII), discussed the need to balance private property rights and public interest in construction, and endorsed negotiation as the primary path to resolve such disputes, backed by interim injunctions to incentivize agreement.
4. Appraisal Concerns in Court-Ordered Sales and Lease Disputes
Court-ordered sales may deviate from market value definitions, presenting challenges in property tax assessments, though typically supported by appraisals. Commercial lease renewals are fraught with potential issues if the terms are too vague or too narrow, with complications arising from tenant improvements and unrealistic expectations of returns under the lease's permitted uses.
5. Developments in Municipal Law
The Supreme Court of Canada's 2024 decision in St. John's (City) v. Lynch, 2024 SCC 17 (CanLII), tackled the contentious issue of compensation for constructive expropriation. The ruling underscored that highest and best use calculations might not apply when a city imposes use restrictions. Additionally, delays in municipal permitting are common, with mandamus being the primary remedy, as claims for damages against municipalities face high thresholds of proof for misfeasance.
Looking Ahead: Future Trends and Issues
The session also cast light on emerging trends likely to shape the real estate litigation landscape:
- Appraisal disputes are on the rise due to shifting economic conditions leading to property tax disputes, rental disputes, and court-ordered sales.
- Alternative Dispute Resolution (ADR), which includes mediation, neutral evaluation, and arbitration, is gaining favour for its efficiency and confidentiality.
- Early dispute resolution during projects is becoming a standard practice.
- Collaborative contracting models are a new trend and require careful drafting to ensure effectiveness.
- Privacy issues in tenant screening practices are under investigation, warranting close attention. The Privacy Commissioner of Canada and the Information and Privacy Commissioner for B.C. are undertaking a joint investigation into a company that performs background checks for landlords who are looking to screen potential tenants.
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