The City of Vancouver and Brenhill Developments Ltd. have appealed the January 27, 2014 decision of the BC Supreme Court in Community Association of New Yaletown v Vancouver (City), 2015 BCSC 117 (the Brenhill/New Yaletown decision). The appeal challenges a decision that imposed extensive new public disclosure requirements on the City and stopped Brenhill's construction of a social housing project nearly nine months after it was approved by the City.
In Brenhill/New Yaletown, Mr. Justice McEwan of the BC Supreme Court ruled that the City had acted unfairly in its public consultation process for the rezoning of a City-owned property in the Yaletown area and a development permit for an adjacent property. The background facts were that Brenhill and the City had negotiated a proposal in which Brenhill would:
- build a new 13-storey social housing project at a property owned by Brenhill (1099 Richards) to replace and expand older social housing at an adjacent property owned by the City (508 Helmcken);
- upon completion of the new project at 1099 Richards (which required a development permit), transfer ownership of 1099 Richards to the City in exchange for 508 Helmcken and the closure of an adjacent lane;
- provide a cash contribution of $1 million to the City; and
- (after the residents of 508 Helmcken moved to 1099 Richards) proceed with development of a new 36-storey tower at 508 Helmcken (which required a rezoning by-law).
In August 2013, after a public consultation process, the City approved a development permit to build the social housing project at 1099 Richards and in March 2014, enacted the rezoning by-law to allow the tower at 508 Helmcken.
On April 25, 2014, Community Association of New Yaletown (New Yaletown) was incorporated, and in May 2014, New Yaletown brought an application under the Judicial Review Procedure Act (JRPA) which ultimately resulted in the Court quashing the rezoning by-law and the project's development permit. This relief was granted despite that the developer, Brenhill, had started construction in September 2013 and spent approximately $7 million in reliance on the City's project approvals.
The Court held that for a valid public hearing, the City must provide the public with a transparent, complete and comprehensible description of any proposed project, including details of confidential agreements entered into by the City with the developer, the project's advantages and disadvantages, the City's financial justifications for the project and the analyses and assumptions underlying those justifications. The presumption is that without such disclosures, the public cannot offer informed commentary for City Council to consider before making its discretionary decisions on matters of land use and other development approvals.
The Brenhill/New Yaletown decision has left many Vancouver development projects in a state of uncertainty. The additional disclosure mandated by the Court in Brenhill/New Yaletown have increased the risk that public hearings held in respect of other already-approved development projects could be challenged and found to have been conducted unfairly because of an alleged lack of fulsome disclosure. Of equal concern was the Court's willingness to allow New Yaletown to initiate JRPA proceedings many months after the expiry of the one month post-enactment period during which a by-law or resolution can be challenged under the Vancouver Charter, and despite that Brenhill had started construction more than eight months before.
The City and Brenhill are expected to seek an expedited appeal process that could result in a decision from the British Columbia Court of Appeal as early as late May 2015. As the appeal process plays out, developers with projects underway in Vancouver will be left in legal limbo for at least a few more months.
If you have any questions about the decision and how it may affect you or your business, please contact Larry Sandrin, Laura Gill or David Bowles.