No economic damages from abandonment of subdivision due to conditions: BC Court of Appeal

The British Columbia Court of Appeal has ruled that conditions placed on land subdivision because of a Regional District building officer’s input raises no reasonable cause of action by the applicants.

In Kamoto Holdings Ltd. v. Central Kootenay (Regional District), 2022 BCCA 282, Gordon and Jill Cann applied to subdivide their property in the Village of Nakusp. The approving officer sent a subdivision plan to the Regional District of Central Kootenay for comment. A building inspector from the district found several issues, such as infringement of fire safety provisions of the Building Code, which led to the approving officer placing conditions on subdivision.

The Canns found that fulfilling the conditions would be expensive and abandoned the application. Later, they purchased another piece of land through their company, Kamoto Holdings Ltd. After further inquiries, the approving officer removed the conditions, but the Canns no longer wished to proceed with the subdivision.

The Canns argued that the Regional District building inspector’s comment was based on incorrect information, which was negligently incorporated into a “policy.” They sued the Regional District and the Village for economic damages they allegedly suffered due to the attached conditions.

Both the Regional District and Village applied to strike the claim, alleging improper collateral attack on the administrative process. The judge agreed, struck the claim, and dismissed the action. She also found that the Regional District and the Village were not subject to “a private law duty of care” to the Canns and Kamoto.

On appeal, Kamoto argued that the judge erred by making findings of fact.

Despite agreeing that the judge overstepped in certain areas, the appellate court dismissed the appeal.

The appellate court found that certain areas in the judge’s decision were better left to trial, such as correctness or reasonableness of information provided by the Regional District. However, the issue at hand was whether the claim disclosed a reasonable cause of action, said the court.

No economic damages from public agencies’ negligence

Public agencies are an essential part of the subdivision approval process, and while it is foreseeable that applicants might suffer economic detriments from agencies’ negligence, there is no relationship of proximity that entitles people like the applicants to rely on them, said the court.

“The Regional District did not undertake a responsibility to the [Canns], nor did it manifest an intention to induce them to act a particular way. … It merely gave advice to the approving officer to assist her in exercising public duties,” said the court.