Expropriation

How BC law treats it

In BC, provincial bodies, municipalities, and other authorities given expropriation powers by statute must follow the Expropriation Act, RSBC 1996, c 125. The process starts with an expropriation notice served on owners and filed in the land title office, followed by approval from the approving authority. Title or the interest taken vests in the expropriating authority when a vesting notice is filed. An owner may request an inquiry by an inquiry officer into whether the expropriation is necessary to achieve the authority's objectives. The request must be served within 30 days after the expropriation notice, and no inquiry is available for linear developments such as highways, pipelines and transmission lines (s. 10). The inquiry officer's report is advisory only: the approving authority makes the final decision. The Act does not give owners a general right to stop a taking in court because they disagree with the public purpose. Compensation is based on the market value of the interest taken, plus reasonable disturbance damages such as moving costs and certain business losses (ss. 31 and 34). The authority must make an advance payment of its estimate of compensation, which the owner can accept without giving up the right to claim more. Reasonable legal, appraisal and other costs of asserting the claim are generally recoverable (s. 45). The Act's definition of owner extends to people with interests in land, so commercial tenants can claim, and a lessee under a lease of more than one year may recover disturbance damages (s. 39). Compensation disputes are decided by the BC Supreme Court, which took over from the Expropriation Compensation Board after the Board was abolished in 2005. Federal takings, such as for national railways or federal works, follow the federal Expropriation Act, RSC 1985, c E-21, which has its own objection and compensation process.

What it means for your business

Transit lines, highway widening and utility corridors regularly affect BC commercial property. An owner or tenant facing expropriation may lose a location, customers and goodwill, not just land. The compensation scheme allows recovery of business losses and professional costs, but only if the claim is documented and pursued properly. Leases, mortgages and financing arrangements should be reviewed early, since the expropriation can trigger termination rights and affect how compensation is shared. Example: A Surrey restaurant leases space in a strip mall that is expropriated for a rapid transit station. The tenant claims disturbance damages for relocation costs and lost business, separate from the landlord's claim for the land's market value.

Risks and common mistakes

Accepting the advance payment as full settlement without recognizing it is only the authority's estimate. Assuming only the registered owner is entitled to compensation and overlooking a tenant's claim. Failing to keep records of relocation costs and business losses needed to prove disturbance damages. Expecting a court to overturn the taking because the owner disagrees with the project. Ignoring lease clauses that deal with expropriation and the division of any award.