Issue: Compensation for constructive expropriation and the role of zoning in determining market value.

Key Points:

• Background:

  • The Lynch family owns land in the Broad Cove River watershed, restricted by zoning laws aimed at protecting St. John’s water supply.
  • After the City denied multiple development requests, the Court of Appeal ruled that the City’s actions constituted a constructive expropriation.

• Core Legal Question:

  • Should compensation reflect the property’s value based on restrictive zoning (agriculture, forestry, public utility) or as if it could be developed for housing?

• Supreme Court Decision:

  • The Court ruled that the property must be valued according to existing zoning regulations, restoring the decision of the application judge.
  • The Court applied the Pointe Gourde principle, which excludes increases or decreases in value caused by an expropriation scheme. However, it found that the watershed zoning was an independent enactment, not part of the expropriation scheme.

• Ruling:

  • The family is entitled to compensation based on the limited uses permitted under the current zoning. Ignoring these restrictions would unfairly give the family a windfall, as residential development was never permissible.

Conclusion: Compensation must consider the existing zoning, which limits the property's use, ensuring fairness without granting undue advantage to the landowners. No monetary award was specified.