R. v. Al Klippert Ltd., [1998] 1 SCR 737

R. v. Al Klippert Ltd., [1998] 1 S.C.R. 737

Her Majesty The Queen                                                                   Appellant

v.

Al Klippert Ltd.                                                                                  Respondent

Indexed as:  R. v. Al Klippert Ltd.

File No.:  25670.

1998:  January 29; 1998:  April 30.

Present:  Lamer C.J. and L’Heureux‑Dubé, Gonthier, Cory, McLachlin, Iacobucci and Bastarache JJ.

on appeal from the court of appeal for alberta

Administrative law ‑‑ Validity of order ‑‑ Collateral attack on administrative order in penal proceedings ‑‑ Circumstances in which person charged with failing to comply with administrative order can collaterally attack validity of order ‑‑ Applicable principles.

Municipal law ‑‑ Zoning ‑‑ Non‑conforming use ‑‑ Order made under provincial planning statute enjoining company to stop operating mine on part of its land ‑‑ Company not availing itself of right to appeal under statute and ignoring order in part ‑‑ Company charged with failing to comply with order ‑‑ Whether company can raise validity of order by way of defence ‑‑ Planning Act, R.S.A. 1980, c. P‑9, ss. 81, 154, 155.

In 1964 the respondent company purchased a parcel of land on which it operates a sand and gravel mine.  A mine has been in operation on the site since 1959.  At that time, the land was situated in a municipal district, which was annexed to the City of Calgary in 1961.  In 1991, the respondent dug up a part of the land that had until then gone untouched.  Following a citizen's complaint and an investigation by a development officer of the City, the company was served with an order, under s. 81 of the Alberta Planning Act, that enjoined it to stop all mining on this part of the land and to restore the site to its original condition.  The respondent did not appeal to the Development Appeal Board (“Board”) and, although it did stop the operations at issue, it failed to restore the site to its original condition, which would have cost it approximately $45,500.  When charged with failing to comply with the order, the respondent submitted by way of defence that the municipal district had granted the former owner an authorization to operate a mine on the land in 1959.  After examining the evidence, the trial judge concluded that such an authorization had in all likelihood been in effect and that the mining operations constituted a non‑conforming use that could be continued pursuant to s. 74(4) of the Planning Act.  The respondent was therefore acquitted.  On appeal, the Court of Queen's Bench found the respondent guilty.  The court held that the trial judge lacked jurisdiction to determine the merits of the order since an appeal lay to the Board.  In a majority decision, the Court of Appeal reversed that judgment and restored the respondent's acquittal.

Held:  The appeal should be allowed.

The principles applicable to this case were reviewed in Consolidated Maybrun.  In summary, whether a collateral attack is possible must be determined by reviewing the legislature's intention as to the appropriate forum.  For that purpose, it is helpful to consider, in particular, the following factors:  the wording of the statute under the authority of which the order was issued; the purpose of the legislation; the existence of a right of appeal; the kind of collateral attack in light of the expertise or raison d'être of the administrative appeal tribunal, and the penalty on a conviction for failing to comply with the order.  These factors are not exhaustive and constitute indicia that might be of assistance in determining the legislature's intention.  Owing to the particular characteristics of a given administrative scheme, it may be that one of these factors will be decisive on its own in one case.

Applying these principles here leads to the conclusion that the trial judge lacked jurisdiction to determine the merits of the order.  The Planning Act does not authorize a person affected by an order to disregard the appeal procedure before the  Board and then to seek to collaterally attack the order by way of defence to a penal charge.  The purpose of the Act is to ensure the harmonious use and development of land in the province by taking into account both economic and environmental interests, as well as the rights of affected individuals.  To achieve that purpose, the Act provides that an order issued by a development officer may be appealed to the Board and then, with leave, to the Court of Appeal.  This is a public, adversarial process affording the person concerned the opportunity to present his or her point of view and assert his or her rights, and to be informed of the reasons for the Board's decision.  Aside from an application to a superior court for review, this is the only mechanism available for challenging an order.  Here, the Court of Appeal's error lies primarily in focusing on the powers of the development officer rather than on those of the Board.  It is clear that the Board had jurisdiction to determine questions relating to the existence of a permit or of a right of use based on a non‑conforming use.  The penalty on a conviction for failing to comply with the order ‑‑ a maximum fine of $2,500 ‑‑ is insufficient to justify disregarding the appeal procedure and allowing collateral attacks.

With respect to the power to order, pursuant to the powers conferred by s. 155 of the Planning Act, that the order be complied with, although a judge required to exercise that power can, for sentencing purposes only, consider the merits of the order, this is not a wide open door to collateral attacks to the detriment of the appeal procedure established by the Act.  In this case, it is not open to us to decide whether the trial judge erred in exercising that power when imposing the sentence after the judgment of the Court of Queen's Bench.

Cases Cited

Followed:  R. v. Consolidated Maybrun Mines Ltd., [1998] 1 S.C.R. 706, aff’g (1996), 28 O.R. (3d) 161; referred to:  R. v. Greenbaum, [1993] 1 S.C.R. 674; R. v. Sharma, [1993] 1 S.C.R. 650; Khanna v. Procureur général du Québec (1984), 10 Admin. L.R. 210; R. v. Rice, [1980] C.A. 310.

Statutes and Regulations Cited

Municipal Government Act, S.A. 1994, c. M‑26.1.

Planning Act, R.S.A. 1980, c. P‑9, ss. 2, 74(4), 81(1), 83(3), (4), 84, 85(2), (3), 152 [am. 1984, c. 33, s. 8], 154 [am. 1991, c. 28, s. 15], 155 [rep. & sub. idem, s. 16].

APPEAL from a judgment of the Alberta Court of Appeal (1996), 187 A.R. 241, 127 W.A.C. 241, 43 Alta. L.R. (3d) 225, 35 M.P.L.R. (2d) 192, 141 D.L.R. (4th) 80, 111 C.C.C. (3d) 108, [1996] 10 W.W.R. 755, [1996] A.J. No. 852 (QL), allowing the respondent's appeal from a judgment of the Court of Queen's Bench (1993), 146 A.R. 211, [1993] A.J. No. 1094 (QL), which had allowed the Crown's appeal from the respondent's acquittal (1993), 142 A.R. 71, 15 M.P.L.R. (2d) 62, [1993] A.J. No. 398 (QL).  Appeal allowed.

Brian A. Crane, Q.C., and John H. Gescher, for the appellant.

Gary C. Courtney, for the respondent.

English version of the judgment of the Court delivered by

1.                            L’Heureux‑Dubé J. -- This appeal was heard the same day as the appeal in R. v. Consolidated Maybrun Mines Ltd., [1998] 1 S.C.R. 706, and the decision is rendered simultaneously.  As in Consolidated Maybrun, the issue here is whether a person facing penal charges for failing to comply with an administrative order can challenge the validity of the order by way of defence when the appeal process provided for by law for such a challenge has not been pursued.

I.  Facts

2.                            Since 1964, Al Klippert Ltd. has owned 40 acres of land in the Calgary area on which it operates a sand and gravel mine.  A mine has been in operation on the site since 1959, at which time the land was part of the Municipal District of Rockyview.  After the Municipal District of Rockyview was annexed to the City of Calgary in 1961, the land was included in an urban zone pursuant to By‑law 2P80.

3.                            In 1991, in the course of its operations, Klippert dug up a part of the land that had until then gone untouched.  In response to a citizen’s complaint, a development officer of the City went to the site and observed that trees and shrubs had been removed and that digging had taken place on three acres of land.  On February 7, 1992, the officer notified Klippert that an investigation was in progress concerning a potential breach of By‑law 2P80.  The notice also requested Klippert to stop the operations.

4.                            On March 30, 1992, Klippert was served with notice of an order, issued pursuant to s. 81 of the Planning Act, R.S.A. 1980, c. P‑9, that enjoined it to stop all mining on the three acres in question and to restore the site to its original condition within 60 days.  The order further prohibited any future mining on the parcel of land in question.  In addition, a letter accompanying the order advised Klippert of its right to appeal the order to the Development Appeal Board within 14 days.

5.                            Although the respondent did stop the operations at issue, it failed to restore the site to its original condition, which would have cost it approximately $45,500.  A charge of failing to comply with the order was accordingly filed in the Provincial Court on June 10, 1992.

II.  Judgments

1.  Provincial Court (Criminal Division) (1993), 142 A.R. 71

6.                            At trial, Klippert submitted by way of defence that the Municipal District of Rockyview had granted the former owner an authorization in 1959, two years before being annexed to the City of Calgary.  Although there was no permit attesting to this authorization, the judge concluded, based on the testimony and on the minutes of meetings of the Interim Development Board, in existence at that time, that an authorization to operate a sand and gravel mine on the land had in all likelihood been effective since 1959.  He also accepted Klippert’s alternative argument that the mining operations constituted a non‑conforming use that could be continued pursuant to s. 74(4) of the Planning Act.  Since the use was lawful, the judge acquitted Klippert of the offence with which it was charged, that is, of contravening the order by failing to restore the site to its original condition.

2.  Court of Queen’s Bench (1993), 146 A.R. 211

7.                            According to Chrumka J., the basic question was whether the trial judge had jurisdiction to determine the merits of the order.  Since an appeal lay to the Development Appeal Board, which can determine the validity or merits of an order, substitute a different order or simply revoke the order, he held that the trial judge lacked jurisdiction to determine the merits of the order.  In his view, this jurisdiction lay in the Board alone.  He found Klippert guilty of breaching the order and remitted the matter to the trial judge for sentencing.

3.  Provincial Court (Criminal Division), On Sentencing

8.                            In light of the deterrent purpose of the penalty, the judge sentenced Klippert to pay a fine of $1,000.  In addition, exercising the powers conferred on him by s. 155 of the Planning Act, he ordered Klippert to comply with the order by restoring the site to its original condition and refraining in future from any mining operations on the parcel of land at issue.

4.  Court of Appeal (1996), 187 A.R. 241

9.                            Writing for the majority, Conrad J.A. reversed the decision of the Court of Queen’s Bench and held that the trial judge could determine the merits of the order in a penal proceeding.  In her view, the deference courts must show to decisions within the expertise of administrative tribunals does not apply in the same way to all decisions of public officials.  On reviewing the Planning Act, she concluded that the legislature had not intended to bar a person charged with failing to comply with an order from having a trial judge review the order on its merits.  According to her, to permit a collateral attack is not inconsistent with the purposes of the Act.  She also observed that the Act does not ascribe finality to a development officer’s order, which is but the first step in the process.  Finally, on sentencing, she referred to s. 155, which empowers a trial judge to order the accused to comply with the order.  In her view, the trial judge is thereby called upon to rule on land‑use planning matters.

10.                          Hetherington J.A., in dissent, would have dismissed the appeal for the reasons of Laskin J.A. in R. v. Consolidated Maybrun Mines Ltd. (1996), 28 O.R. (3d) 161 (C.A.).

III.  Issue

11.                          The only issue is whether the trial judge had jurisdiction to determine the merits of the administrative order.

IV.  Relevant Statutory Provisions

12.                          I note that the Planning Act has since been replaced by the Municipal Government Act, S.A. 1994, c. M‑26.1.  At the relevant time, the Planning Act provided as follows:

81 (1)  If a development officer finds that a development or use of land or buildings is not in accordance with

                                                                   . . .

(c)  a land use by‑law or the land use regulations,

the development officer may, by notice in writing, order the registered owner, the person in possession of the land or buildings or the person responsible for the contravention or all or any of them to

(d)  stop the development or use of the land or building in whole or part as directed by the notice,

                                                                   . . .

(f)  take other measures specified in the notice so that the development or use of the land or building is in accordance with this Act, the regulations, a development permit, subdivision approval or land use by‑law, as the case may be,

within the time specified by the notice.

83 . . .

(3)  If a development officer

(a)  refuses or fails to issue a development permit to a person,

(b)  issues a development permit subject to conditions, or

(c)  issues an order under section 81,

the person applying for the permit or affected by the order under section 81, as the case may be, may appeal to a development appeal board in accordance with this Division.

(4)  A person affected by an order, decision or development permit made or issued by a development officer, other than a person having a right of appeal under subsection (3), may appeal to a development appeal board in accordance with this Division.

84 (1)  An appeal to a development appeal board shall be commenced by serving a written notice of the appeal on the development appeal board within 14 days after,

(a)  in the case of an appeal made by a person referred to in section 83(3), the date on which

(i)  the person is notified of the order or decision or the issuance of the development permit, or

                                                                   . . .

(2)  Within 30 days of receipt of a notice of appeal, the development appeal board shall hold a public hearing respecting the appeal.

85 . . .

(2)  The development appeal board shall

(a)  make and keep a written record of its proceedings, which may be in the form of a summary of the evidence presented to it at the hearing, and

(b)  give its decision in writing together with reasons for the decision within 15 days of the conclusion of the hearing.

(3)  In determining an appeal, the development appeal board

                                                                   . . .

(b)  may confirm, revoke or vary the order, decision or development permit or any condition attached to any of them or make or substitute an order, decision or permit of its own;

                                                                   . . .

152 (1)  Subject to subsection (2), on a question of law or on a question of jurisdiction, an appeal lies to the Court of Appeal from the Board or a development appeal board.

(2)  An application for leave to appeal pursuant to subsection (1) shall be made

(a)  to a judge of the Court of Appeal, and

(b)  within 30 days after the issue of the order, decision, permit or approval sought to be appealed,

and notice of the application shall be given to the Board or the development appeal board, as the case may be, and such other persons as the judge may direct.

(3)  On hearing the application and the representations of those persons who are, in the opinion of the judge, affected by the application, the judge may

(a)  grant leave to appeal,

(b)  direct which persons or other bodies shall be named as respondents to the appeal,

(c)  specify the questions of law or questions of jurisdiction to be appealed, and

(d)  make any order as to the costs of the application that he considers appropriate.

(4)  If an appeal is from a development appeal board, the municipal corporation shall be given notice of the application for leave to appeal and shall be a respondent to the application and, if leave is granted, a respondent to the appeal.

                                                                   . . .

154  A person who

(a)  contravenes any provision of this Act or the regulations,

(a.1)  contravenes a land use by‑law,

(b)  contravenes an order under section 81,

                                                                   . . .

is guilty of an offence and is liable to a fine of not more than $2500.

155  If a person is found guilty of an offence under section 154, the court may, in addition to any other penalty imposed, order the person to comply with

(a)  this Act, the regulations or a land use by‑law,

(b)  an order under section 81, or

(c)  a development permit, a subdivision approval or a condition attached to a development permit or subdivision approval.

V.  Analysis

1.  Applicable Principles

13.                          In Consolidated Maybrun, supra, this Court reviewed the applicable principles for determining whether a person charged with failing to comply with an administrative order can collaterally attack the order by way of defence.  I do not intend here to repeat all the matters discussed in that decision.  In summary, whether a collateral attack is possible must be determined by reviewing the legislature’s intention as to the appropriate forum.  For that purpose, I stated that it might be helpful to consider, in particular, the following factors:  (1) the wording of the statute under the authority of which the order was issued; (2) the purpose of the legislation; (3) the existence of a right of appeal; (4) the kind of collateral attack in light of the expertise or raison d’être of the administrative appeal tribunal; and (5) the penalty on a conviction for failing to comply with the order.

14.                          However, I wish to stress once again that these factors are not necessarily exhaustive but rather constitute various indicia which might be of assistance in determining the legislature’s intention.  Furthermore, due to the particular characteristics of a given administrative scheme, it may be that one of these factors will be decisive on its own in one case but not in another.  The determination of legislative intent is never a mechanical act, and an inflexible formula cannot be applied in carrying it out.

2.  Application of the Principles to the Case at Bar

15.                          Applying the principles from Consolidated Maybrun, supra, to the case at bar, I conclude that the Court of Appeal erred in permitting the collateral attack on the administrative order.

16.                          The purpose of the Planning Act, as stated in s. 2 thereof, is to ensure the harmonious use and development of land in the province by taking into account both economic and environmental interests, as well as the rights of affected individuals.  The growth of modern societies has shown the serious problems that can result from anarchic development and use of land, in particular those problems concerning public health and the environment.  While the public interest in regulating land use is indisputable, such regulation must also take the rights of affected individuals into account.  Furthermore, as I stated in Consolidated Maybrun, supra, at para. 27:

In order to ensure the integrity of . . . administrative structures, while at the same time seeking to protect the rights of individuals affected by government actions, the legislature is free to set up internal mechanisms and establish appropriate forums to enable such individuals to assert their rights.  In considering the requirements resulting from the rule of law and the rights of a person accused of non-compliance with an administrative order, it is important not to isolate the penal proceedings from the whole of the process established by the legislature.

17.                          In the present case, the Act establishes a process and a specific forum for achieving the purpose of balancing the public interest against individual rights.  In the specific case of an order issued by a development officer, the Planning Act provides for a full appeal mechanism.  Thus, under ss. 83 and 84, a person affected by an order or denied a permit may, within 14 days, appeal to a development appeal board.  The Act then requires the Board to notify the municipal authorities concerned and hold a public hearing within 30 days.  It must also keep a record of the hearing and give written reasons within 15 days of the conclusion of the hearing.  It may confirm or revoke the order, or issue a new one.

18.                          I see no inconsistency between full recognition of the rights of affected individuals and the procedure established by the legislature for the Development Appeal Board’s proceedings.  As can be seen, this is a public, adversarial process affording the person concerned the opportunity to present his or her point of view and assert his or her rights, and ultimately to be informed of the reasons for the Board’s decision.  Furthermore, an interested party may, if dissatisfied with the Board’s decision, take his or her case to the Court of Appeal on a question of law or of jurisdiction.  It should be noted that this is not an appeal as of right, but one requiring leave of a judge of the Court of Appeal.  Not only is this a full appeal mechanism, but the procedure for applying to the Court of Appeal for leave shows the protection the legislature intended to afford the Board’s decisions and the importance it placed in that body.

19.                          It is true, as underlined by the Court of Appeal, that where the initial stage of the order is concerned:  “There has been no hearing in front of a board with expertise.  One person, making an initial judgement, makes a direction without the normal safeguards of ensuring both sides have been heard” (p. 248).  However, it is for this very reason that the Act provides for the possibility of appealing to the Board within 14 days.  In my view, aside from an application to a superior court for review, this is the only mechanism available for challenging an order.

20.                          Here, the Court of Appeal’s error lies primarily in focusing on the powers of the development officer rather than on those of the Development Appeal Board.  While the subject of the challenge is the officer’s order, the question whether the order can be challenged without appealing to the Board requires that the Board’s jurisdiction be considered first.  From this perspective, it is not especially helpful to focus, as did the Court of Appeal, on the fact that the Act confers no exclusiveness whatsoever on the development officer’s decisions or that an order issued by the officer is not final.  The point at issue here is not whether the officer’s order may or may not be challenged, but in what forum that challenge must take place and, more specifically, whether the legislature intended that the officer’s decision be challenged before the Development Appeal Board rather than in a penal court.  The discussion must therefore focus on the Board’s jurisdiction.

21.                          Nor is it helpful, in my view, to consider, as the Court of Appeal did, the fact that Klippert could have been charged with breaching the municipal by‑law rather than with failing to comply with the order, and that in such a case it might have raised the existence of a permit.  This tells us nothing about the legislature’s intention regarding the appropriate way to challenge an order issued pursuant to the Act.  Had Klippert simply been charged with breaching the municipal by‑law, it can of course be assumed that it would have been able, by way of defence, to raise the existence of a permit or even to challenge the validity of the by‑law: R. v. Greenbaum, [1993] 1 S.C.R. 674; R. v. Sharma, [1993] 1 S.C.R. 650; Khanna v. Procureur général du Québec (1984), 10 Admin. L.R. 210 (Que. C.A.); R. v. Rice, [1980] C.A. 310.  In such a case, it would have been inappropriate to criticize Klippert for failing to appeal the matter to the Board, as the Board in the absence of an order would not have had jurisdiction to hear such an appeal.  However, the situation before the Court is totally different.  An order was issued from which an appeal lay to the Board and then, with leave, to the Court of Appeal.  In this context, the existence of a permit or of a right of use based on a non‑conforming use are clearly questions over which the Board had jurisdiction.  After neither complying with the order nor seeking to challenge it in accordance with the requisite procedure, Klippert cannot reformulate the charge as it pleases in order to defend itself as if only the municipal by‑law were at issue.  I would add that had the by‑law’s validity been challenged, the penal court’s jurisdiction would not be a problem.  However, that is not the case here.

22.                          I turn now to the question of sentencing.  Section 154 provides for a fine of up to $2,500.  In itself, this penalty is insufficient to justify disregarding the appeal procedure and allowing collateral attacks.  However, unlike the situation in Consolidated Maybrun, supra, the Planning Act gives the trial judge the power to order, in addition to this penalty, that the accused comply with the development officer’s order (s. 155).  This power was in fact exercised by Judge Delong in the case at bar, with the result that the three acres at issue may no longer be mined and that the land must be restored to its original condition.  It was adduced in evidence that the cost of restoring the land would be approximately $45,500.  On the one hand, it cannot be denied that this is an especially serious consequence for the accused.  On the other, it was pointed out that s. 155 has the effect of requiring the judge to rule on land‑use planning matters, so that the hesitation to allow the trial judge to determine the merits of the order would not be justified.  The Court of Appeal accepted this argument.

23.                          Although I sympathize with the respondent on this point, I nevertheless do not believe that the solution is to authorize collateral attacks, thereby permitting to circumvent the appeal procedure established by the Act.  The legislature’s intention in establishing this procedure was to avoid systematic recourse to the courts, and to allow collateral attacks would run counter to this legitimate purpose.

24.                          This does not mean, however, that a judge required to exercise his or her power under s. 155 cannot, for sentencing purposes only, consider an error in the order, inter alia as to the existence of a permit.  However, this is not equivalent to allowing a collateral attack by way of defence to the charge of failing to comply with an order.  In the case at bar, the commission of the charged offence is independent of the merits of the order, which should, where appropriate, be raised before the Development Appeal Board.  A person who refuses to comply with an order commits an offence, which can then be punished under s. 154.

25.                          As for whether it is appropriate for the judge to further order, pursuant to the additional powers conferred by s. 155, that the order be complied with, this question is a distinct one, which is reflected in the scheme of the Act, which deals separately with the fine and the decision to uphold the order.  The fact that the merits of the order can be considered for this specific purpose is not a wide open door to collateral attacks to the detriment of the appeal procedure established by the Act.

26.                          This solution has the merit of encouraging affected persons to avail themselves of the prescribed procedure for challenging the order, thereby avoiding systematic recourse to the courts, while at the same time permitting the trial judge, in the event of non‑compliance, to impose a sentence that is fair in light of the legal situation of the accused.  In my view, this is the only interpretation of the Act that respects at once the integrity of the Act’s appeal process, the powers conferred by the Act on the trial judge and the rights of a person affected by an administrative order.

27.                          In the case before us, however, the respondent did not raise in this Court the question whether Judge Delong had erred in imposing the sentence, and sought no relief in respect thereof.  In these circumstances, it is not open to us to decide whether Judge Delong erred in upholding the order when imposing the sentence.  That would require us to review the evidence that the trial judge had the benefit of hearing and in respect of which we are in principle neither equipped nor prepared to intervene in the instant case.

VI.  Disposition

28.                          I conclude that the Planning Act does not authorize a person affected by an order to disregard the appeal procedure before the Development Appeal Board and then to seek to collaterally attack the order by way of defence to a penal charge.  The trial judge accordingly lacked jurisdiction to determine the merits of the order.

29.                          For these reasons, I would allow the appeal, set aside the decision of the Court of Appeal and affirm the conviction entered by Chrumka J. of the Court of Queen’s Bench and the sentence imposed by the Provincial Court (Criminal Division), the whole with costs.

Appeal allowed with costs.

Solicitor for the appellant: City of Calgary Solicitor’s Office, Calgary.

Solicitors for the respondent:  Courtney Sebree, Calgary.