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Turner Drake & Partners Ltd.
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# Tuesday, June 30, 2020

In truth, very few people get the chance to suffer the trauma of an expropriation.  You have to be in the wrong place at the right time. But if and when your opportunity does come, your best hope is to emerge financially “whole”, albeit a little battle scarred, confident that the lawmakers have your back through their expropriation legislation.

Expropriation legislation has its roots in the Dickensian days of the English railway boom of the 19th century, a time of rapid industrialization that needed legislative “devices” to hurry things along. Reforms followed until eventually the individual was adequately protected against the state. In Canada, legislative reform came along in much more modern times, but by the 1970’s most provinces had a pretty decent code of expropriation compensation in place.  And Nova Scotia was among the best of the best.  Its 1973 Expropriation Act fully embraced the commendable philosophy that because expropriated owners were being deprived of their property against their will, they should not be treated as typical litigants. Instead they were entitled to be satisfied – at the authority’s expense – that they were indeed being treated fairly. The playing field was level: all was good.

Alas, things have changed since then. Numerous subtle and not-so-subtle changes have been introduced over the past 25 years that have tilted the playing field.  And always in the same direction. Perhaps the biggest changes, in the Nova Scotia Expropriation Act at least, have been with regard to the expropriating authority’s legal obligation to reimburse a claimant’s fees. The original safety net was contained, in plain and simple language, in section 35 of the original Nova Scotia Expropriation Act.  It entitled an expropriated land owner to be reimbursed for “the cost of one appraisal and the legal and other costs reasonably incurred…in asserting a claim for compensation”. Checks and balances protected the public purse from frivolous abuse, but the basic intent was that, win, lose or draw, an owner – rich or poor - was entitled to be heard at the authority’s expense. 

The first change came in 1996. Section 35 was abruptly repealed and in its place stood a re-enacted section 52. Things became considerably more dicey for the property owner with respect to the reimbursement of costs, which were now only assured if the owner proceeded to a hearing and won outright.  The owner was now in much the same position, for cost purposes, as a typical litigant who chooses to engage in combat.  Of course, there is nothing preventing an amicable settlement without resorting to a hearing – and the vast majority of expropriations are settled that way – but the safety net of section 35 was removed.

2019 saw more changes when the Nova Scotia government introduced a Tariff of Costs to control the amount of appraisal, legal and other experts’ costs that an expropriating authority must legally reimburse. Henceforth the amounts that combative property owners can recover are prescribed by law.  With respect to appraisal fees, the allowable amounts depend on the complexity of the case (measured against a rather loosely defined benchmark called “ordinary difficulty”).  In some cases the Tariff will be sufficient. In other cases it will fall short.  The same with the reimbursement of legal fees.  Claimants may very well have to reach into their own pockets to pursue their case from now on, as would a typical litigant. If you think that sounds a tad unfair, you are right.  After all, no one chooses to be expropriated. And from my experience it is always more time consuming, and therefore more costly, to represent a claimant than it is to represent an expropriating authority. For property owners, this is a once-in-a-lifetime event.  The rules have to be explained; facts sorted from fiction; expectations managed. Expropriating authorities, on the other hand, can draw on their in-house resources and often have a wealth of experience.  The conversations are different.

And it’s not just the issue of cost reimbursement that has been tilted. Another amendment in 1996 denied compensation for loss of access along provincial highways when alternative access is being provided by new service or access roads. An odd, and as far as we know unique, twist to the Nova Scotia compensation code. More recently, a 2019 amendment introduced a new definition of Disturbance to the Nova Scotia Expropriation Act, a particular head of claim that arises when a claimant has to relocate.  The old words had withstood the test of time, undefined but “undisturbed” for a generation. In Nova Scotia it is now very narrowly – and again, as far as we know, uniquely - defined and will inevitably defeat claims that have previously been upheld.  Indeed that’s the whole point.

Changes to the Expropriation Act in Nova Scotia have usually been introduced as knee jerk reactions following adverse decisions by the courts, introduced as helpful “clarifications” to help them get it right next time. Challenging an expropriation and pursuing a claim through the courts has never been for the faint-hearted.  But these days you might need a war chest with no guarantee that you will emerge financially “whole”. 

Lee Weatherby is the Vice President of our Counselling Division. If you'd like more information about our counselling services, feel free to contact Lee at (902) 429-1811 or lweatherby@turnerdrake.com

Tuesday, June 30, 2020 10:05:02 AM (Atlantic Daylight Time, UTC-03:00)  #    -
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