School Commissioners of Louis Fréchette v. Breton, [1977] 2 SCR 1025

Supreme Court of Canada

School Commissioners of Louis Fréchette v. Breton, [1977] 2 S.C.R. 1025

Date: 1976-10-05

The School Commissioners of the Region of Louis Fréchette (Defendant) Appellant;

and

Dame Jeannette Breton (Plaintiff) Respondent.

1976: May 27; 1976: October 5.

Present: Judson, Ritchie, Spence, Pigeon and de Grandpré JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR QUEBEC

Expropriation—Joint owner of expropriated land not party to proceedings—Right to be heard—Written notice waived—Proceedings acquiesced in—Validity of expropriation against all owners.

Respondent and her husband, separate as to property by a marriage contract, were the joint owners of a piece of land that appellant expropriated, resulting in a total indemnity of $30,000, which was duly paid. By mistake, however, only respondent’s husband was expressly a party to these proceedings, and the cheque in payment of the indemnity was sent to him alone. Later, respondent maintained that she and appellant were both joint owners of the land on which the school had now been built, and began proceedings to obtain a partition of the property. The Superior Court dismissed the action, but the judgment was quashed by the Court of Appeal which ordered assessment, liquidation and partition of the property.

Held: The appeal should be allowed, but appellant is condemned to pay respondent the sum of $15,000.

The facts show without a doubt that appellant’s purpose was to expropriate all of the land jointly owned by respondent and her husband, not merely the interest of respondent’s husband in that land. Respondent always understood that this was the intention of appellant and, at all times, thought of the expropriation proceedings, apparently directed against her husband alone, as in fact directed against the joint owners of the land, that is, against her and her husband.

In principle, an expropriation proceeding must be in strict conformity with the law, and especially, be clearly addressed to the person whom the authorities wish to deprive of property. No exception must be made to this principle except in extraordinary cases where it is clear that the error of the expropriating body could not have deprived the party being expropriated of the right to be heard and to make all representations which concern it.

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The case at bar is an exception to the general rule. The absence of a written notice of expropriation addressed to respondent by name was not fatal, since she had waived her right to receive such notice and acquiesced in the development of the proceedings as begun, so that they were valid as though her name were spelled out in them. Respondent is therefore bound by the expropriation, but the part of the indemnity belonging to respondent was not paid to her, and she has the right to receive it. Appellant, having paid too much to respondent’s husband, retains all remedies against him for recovery of payment made by mistake.

King’s Asbestos Mines v. The Municipality of South Thetford (1909), 41 S.C.R. 585, rev’g. (1908), 17 Que. K.B. 566, followed; Robillard v. La Commission Hydroélectrique de Québec, [1954] S.C.R. 695; Turcotte v. Dansereau (1897), 27 S.C.R. 583, referred to.

APPEAL from a decision of the Court of Appeal of Quebec[1] quashing a judgment of the Superior Court of Quebec dismissing an action for partition. Appeal allowed, but appellant condemned to pay respondent the sum of $15,000.

Claude Boivin, for the appellant.

Robert B. Lafrenière, Q.C., for the respondent.

The judgment of the Court was delivered by

DE GRANDPRÉ J.—In 1960 respondent and her husband, separate as to property by a marriage contract, became the joint owners of a piece of land of considerable size. In 1967, appellant began expropriation proceedings for part of this land, which resulted in a total indemnity of $30,000, which was duly paid. Unfortunately, by mistake, only respondent’s husband was expressly a party to these proceedings, and the cheque in payment of the indemnity was sent to him alone.

Later, respondent sought to convince appellant that they were both joint owners of the land on which the school had now been built. Appellant refused to recognize the validity of this argument, and in 1970 respondent began proceedings to obtain a partition of the property, and to obtain all the necessary orders to do so.

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The Superior Court dismissed this action. The following extracts from this decision give the principal reasons for it.

[TRANSLATION]… the acts and deeds of the L’Heureux up to their interview with their solicitor, following receipt of a cheque in final payment of the indemnity provided by the Public Service Board, showed that they knew perfectly well what position to maintain, that they had always, until then, believed that they were presenting a common front against the defendant expropriating party, and that the indemnity affected the land of which they were owners. Moreover, they had given their counsel a mandate for this purpose.

Until this time, they had said nothing. It was only later that the L’Heureux decided to rely on their own silence, their own omission, I would even say their own dishonesty.

…

For nearly two years, she knowingly allowed a state of affairs to continue which she knew to be incorrect, and she deliberately contributed to misleading the interested parties. This curiously resembles an estoppel.

From these facts, the Superior Court found that respondent had waived receipt of official notice of expropriation and acquiesced in the proceedings undertaken by the commissioners.

This judgment was quashed by the Court of Appeal. Rinfret J. stated “there is no doubt in equity that the Board intended to expropriate all the land, in order to build its school there” (at p. 180), but in law, the solution to the problem lies in the fact that the expropriation proceedings were brought exclusively against respondent’s husband. Since she was not officially a party to the expropriation proceedings, she could not have been deprived of her property rights unless she had given an express mandate to her husband for that purpose, and the evidence reveals no such mandate. Lajoie J. wrote (at p. 183):

[TRANSLATION] Having had the advantage of reading the reasons of Rinfret J., I examined this record myself. This examination has left me with no doubt

(a) that the School Commissioners of the region of Louis-Frechette intended to expropriate all shares in a piece of land jointly owned by Mr. and Mrs. L’Heureux;

(b) that the case was referred to the Public Service Board to fix the indemnity for the whole property;

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(c) that the purpose of the Board’s ruling was to determine the indemnity payable as a result of the expropriation of the whole property;

(d) that appellant (the respondent in this Court) understood this to be so and believed that she had an interest equal to her husband’s in the indemnity paid to him alone;

(e) that, in short, had the indemnity been fixed at a higher sum, acceptable to appellant (the respondent in this Court) the case which we have to decide would never have arisen.

In spite of these observations, Lajoie J. did not see how he could dismiss respondent’s action, first, for the reasons given by Rinfret J., and second, because that action included the allegation that at all relevant times respondent had retained joint ownership of the land, a claim which had been admitted by appellant, so that it could not now allege that despite appearances, respondent was in fact expropriated at the same time as her husband. Beetz J., then a member of the Court of Appeal, concurred with his colleagues.

I agree with the views of Lajoie J. with respect to the basic facts. There is no doubt that appellant’s purpose was always to expropriate the land, not merely the interest of respondent’s husband in that land; this fact was admitted by counsel for the respondent who stated that such was in fact the situation.

There is also no doubt that respondent always understood that this was the intention of the School Commissioners; the; following facts show this:

(1) preliminary discussions relating to the purchase by mutual agreement of the land which was eventually expropriated took place between the School Board on the one hand and Mr. and Mrs. L’Heureux on the other hand;

(2) when these discussions brought no results, respondent learned of the expropriation of which her husband was notified, by a notice that the School Board [TRANSLATION] intends to expropriate the land belonging to you”;

(3) this notice was followed by other discussions between the School Board and Mr. L’Heureux,

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which took place in the presence of respondent and of which she was always kept informed;

(4) respondent accompanied her husband to see the lawyer responsible for representing the party being expropriated, and later participated in the preparation of the hearing before the expropriation board; respondent reported the preliminary step as follows:

[TRANSLATION] Q. NOW, let us take the testimony that it was in 1967 or 1968 that you gave a mandate to Mr. Robert Cliche. Were you with your husband at that time?

A. Yes.

(5) respondent was aware of the proceedings begun by appellant to take preliminary possession of the land, which referred to the property subject to expropriation, and she made no objection;

(6) from the window of her home respondent saw the school being built before her eyes, while the expropriation process was still going on, and at no time made the objection that this school was built on land half of which was hers; it should be noted that respondent’s husband took part in some construction work on the school with his wife’s knowledge;

(7) the hearing before the expropriation board was to determine the total value of the land, not only the value of Mr. L’Heureux’s share in this land; this fact cannot be contradicted and was admitted by counsel for the respondent in this Court, and must have been known to respondent, who was present at this hearing and gave testimony;

(8) it was the party being expropriated who through its counsel requested homologation of the ruling of the Board, alleging that the School Board had “[TRANSLATION] expropriated appellant’s property, lot 649… for construction of a school”;

(9) when the ruling of the expropriation board was made and homologated, a cheque for $30,000 was sent to respondent’s husband, and was the subject of a conversation in Mr. Cliche’s office which respondent reported as follows:

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[TRANSLATION] Q. YOU were with your husband when he went to see Mr. Cliche regarding the matter of the thirty thousand dollars ($30,000), when you went to discuss making an appeal, that is what your husband told the Court?

A. Yes, we said to Mr. Cliche… He said, “this is my share”, then he said to me, “claim it from your husband”.

The conclusion is inevitable: respondent at all times thought of the expropriation proceedings, apparently directed against her husband alone, as in fact directed against the joint owners of the land, that is against her and against her husband. She was satisfied with this state of affairs until such time as she thought that, by taking the attitude she adopts now, she could obtain a much greater indemnity than that granted by the expropriation board. This is therefore a disguised manner of appealing from the decision fixing the amount of indemnity. This amount of $26,730 represents two-thirds of the amount of $40,000 mentioned by Mr. Cliche in the notice to the expropriation board. If respondent is correct, the land, the value of which to the expropriating body was $16,038 and to the party being expropriated was $40,000, in fact had a value of $53,460. Merely stating this proposition indicates that the proceedings in this Court are an afterthought, and do not reflect the true situation of the parties at the relevant time.

It remains for this Court to determine whether, in spite of the Commissioners’ intent to expropriate the whole property, an intent known to and accepted by respondent, there was in law an expropriation of her share in the property, since her name appeared neither in the proceedings nor on the cheque in payment of the indemnity. If so, it will be necessary to restore the judgment at first instance concerning the validity of the expropriation, and find, as did that judgment, that the appearance must be corrected to reflect the reality of a complete expropriation.

As Rinfret J. noted, the rule is clear: the nullifying of a property right through an expropriation proceeding must be surrounded by guarantees. In principle, these guarantees require that the expro-

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priation proceedings be in strict conformity with the relevant laws, and especially, be clearly addressed to the person whom the authorities wish to deprive of property: King’s Asbestos Mines v. The Municipality of South Thetford[2]. The importance of this principle cannot be over‑emphasized, and no exception to it must be made except in extraordinary cases where it is clear that the error of the expropriating body could not have directly or indirectly deprived the party being expropriated of the right to be heard and to make all representations which concern it. I find the case at bar to be this rare exception to the general rule.

Respondent argued that this right to be heard is tied to the right to be an express party to the proceedings, and that the omission of the respondent’s name from the latter is fatal, notwithstanding all the facts summarized above. I cannot agree that the rule is absolute, that it never admits of an exception even where, as in the case at bar, the party being expropriated in fact was aware of the whole situation, could have made her voice heard loud and clear, and was present at each and every stage of the expropriation, including receipt of the cheque.

The purpose of the notice is to bring the claim of the expropriating body clearly to the attention of the party being expropriated, thereby allowing the latter to put forward all the grounds of its claim in full. In the absence of notice, the expropriated party may object to the expropriation proceedings; this is what Robillard v. La Commission Hydroélectrique de Québec[3], decided on the question of an alleged summons which had never existed. On the other hand, the party being expropriated could be unaware of the proceedings until the expropriating body claims to give effect to a judgment of homologation obtained in these conditions; the principle recognized in Turcotte v. Dansereau[4], although stated in another context, appears relevant to me. Such absence of notice, as a general rule, results in nullity.

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However, although the expropriated party in principle has a right to notice, it may be waived. This statement is found in the judgment of Taschereau J., later Chief Justice, speaking for the Court in Turcotte (supra), at p. 587.

He is not bound to plead at all to an action which has not been served upon him. He may certainly waive the want of service but the appellant here has not done so.

Cimon J., speaking for the two dissenting judges on the Court of Appeal in Kings Asbestos Mines[5], cited above, said the same thing in his dissent, and the findings of these judgments were adopted by the three judges of the majority in this Court. Cimon J. wrote at p. 576:

[TRANSLATION] I find no acquiescence by appellant.

The trial judge, in view of the facts of the case, was correct in law in finding that the absence of written notice of expropriation addressed to respondent by name was not fatal, since Mrs. L’Heureux had waived her right to receive such notice and acquiesced in the development of the proceedings as begun, so that they were valid as though her name were spelled out in them. Respondent’s conduct shows quite clearly that her rights would not have been more fully defended if the notice had been complete; the purpose of the legislator in prescribing notice was fulfilled. Any other finding within the narrow framework of the facts proved would mean that form would prevail over substance.

As I mentioned above, Lajoie J., as well as concurring in the opinion of Rinfret J., added another reason (at p. 183). He observed that the proceedings in the case at bar contain a statement on appellant’s part that prevent it from succeeding, that is, that at all relevant times until September 16, 1971 respondent was the joint owner of the land now occupied by the school. The text of this allegation, admitted by counsel for the Commissioners at the preparatory conference, is as follows:

[TRANSLATION] Since acquiring this property, plaintiff has always retained ownership of it.

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I do not see that this admission by counsel for the Commissioners is an estoppel to their plea. This admission must be read in the context of the plea as a whole: it states, in substance, that the proceedings were always directed against the property in its entirety, that respondent’s husband acted for her, and that Mrs. L’Heureux for all legal purposes is bound by the proceedings and obliged to give the Commissioners a release. In my opinion, all that appellant admitted was that on the relevant dates, that is, from 1960 until the conclusion of the expropriation proceedings, respondent was joint owner of the land, and that she later appeared to retain her title. If I had read this admission as Lajoie J. suggested, I would have had to examine the legal effect of an admission of this type made by counsel for a school corporation without the support of a resolution.

I am therefore of the opinion that the expropriation was validly made against all owners of the land, and that it binds respondent. The decision of the Board was followed by payment to respondent’s husband, which she received no part of, according to the evidence. Respondent concluded from this that the expropriation was never completed, since she never received her share of the indemnity, and that as a result the whole of the proceedings should be set aside. I am in partial agreement with this argument. In my opinion, the expropriation proceedings, validly directed against all owners of the land, must be followed by payment to them, not only to one of them. However, it does not follow that the whole of the proceeding is invalidated. The expropriation was validly made, but the part of the indemnity owed to respondent has not been paid to her, and she now has a right to it.

Of course, if the indemnity paid to respondent’s husband had in fact benefited her, or if the husband had held a power of attorney from respondent at the time of payment allowing him to receive the indemnity belonging to her, the record would be complete and appellant would be correct in asking, in its amended plea, that the judgment be equivalent to a release. However, it must be noted

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that this plea does not allege that part of the indemnity was in fact paid to respondent, nor does it allege the existence of a power at attorney given by the respondent to her husband for the purpose of receiving this indemnity. It should also be noted that the evidence does not support the existence of such a power of attorney. It goes no further than the statement made by respondent of her right to part of the indemnity, which was made in Mr. Cliche’s office, the text of which is found earlier in these reasons, in paragraph nine. It is therefore impossible for me to hold with the trial judge that respondent’s husband had a mandate to receive the payment owed to his wife. The share in the indemnity belonging to respondent was never paid to her, and she has the right to receive it. It goes without saying that appellant, having paid too much to respondent’s husband, retains all its remedies against him for recovery of payment made by mistake.

One last point: at the end of his opinion, Rinfret J. wrote:

[TRANSLATION] However extraordinary the situation may appear in equity, I do not believe that, in law, by the effect of the expropriation proceedings against her husband, Dame Breton has been dispossessed of her joint interest in the property in question.

Moreover, the Commission itself recognized this, since in its amended plea it requested that plaintiff be ordered to sign a complete and final release of her rights.

The request for release made by appellant in its plea does not seem to me to be equivalent to recognition of respondent’s contentions. On the one hand, it is a matter of setting aside the appearances, which are that Mrs. L’Heureux still seems to be the joint owner of the land in question, and replacing them with the reality, that is, a complete expropriation against respondent; this conclusion, for the reasons given here, appears justified. On the other hand, there is the request by appellant to recognize payment of the total indemnity to respondent’s husband, when he was only entitled to half of it, as payment in full; as I have just said, I do not believe that this request should be granted.

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For these reasons, I would allow the appeal to this Court without costs, in view of the qualified success; I would quash the judgment of the Court of Appeal, and I would affirm that part of the judgment pronounced in the Superior Court which recognized the validity of the expropriation proceedings against respondent and granted appellant clear title, free of all charges on the property described therein; I would condemn appellant to pay the sum of $15,000 with interest at the legal rate from August 5, 1968, and the costs of a contested action for the said amount in the Superior Court, and those of an appeal of the same amount to the Court of Appeal, reserving appellant’s remedies against respondent’s husband.

Appeal allowed.

Solicitors for the appellant: Boivin, Lagacé & Lessard, Lévis.

Solicitors for the respondent: Lafrenière, Maltais & Ass., Québec.