Municipalities permitted to restrict occupation by owners of rental units

Administrative law – Municipalities – By-laws – Condominiums – Strata corporations – Judicial review – Legislative compliance – Jurisdictional questions – Ultra vires legislation – Standard of review – Reasonableness – Appeals

V.I.T. Estates Ltd. v. New Westminster (City), [2023] B.C.J. No. 799, 2023 BCCA 183, British Columbia Court of Appeal, May 1, 2023, H. Groberman, S.A. Griffin and G.B. Butler JJ.A.

The City of New Westminster adopted zoning amendment bylaws that designated certain multi-family residential properties to be restricted to “residential rental tenure”. These properties may only be occupied by residential tenants that are renting. Owner-occupation is not allowed.

The appellants owned units in six of the buildings that were included in the residential tenure zoning. They challenged the rezoning bylaws. The chambers judge dismissed the petition and concluded that the zoning amendment bylaws were within the City’s powers and were valid.

The appellants grounds of appeal were that the bylaws were void for uncertainty, beyond the jurisdiction of the City to enact, or were inoperative due to conflicts with Provincial statutory provisions. All of the appellants arguments rested on the assertion by the appellants that the Residential Tenancy Act gives landlords the right to occupy their residential premises and no bylaw can interfere with that right. It was found that this was a mischaracterization of the Act.

By way of background, in 2018 British Columbia enacted the Local Government Statutes (residential Rental Tenure Zoning) Amendment Act, 2018 SBC 2018, c 26, which allowed municipalities to implement zoning restrictions to require residential buildings to be used as residential properties and to allow a municipal council to adopt or alter a bylaw in relation to residential tenure covering any part of the municipality.

New Westminster subsequently amended the City’s Zoning Bylaw to limit specific parcels within the city to residential tenure. There were six privately-owned apartment buildings that were included, which formed the subject of the appeal.

The appellants maintained that a correctness standard of review ought to be applied. The City argued the standard of review was reasonableness. It was held that the standard of review was reasonableness, except with respect to the issue of vagueness of the legislation.

Turning to the grounds of appeal, the Court first addressed whether the bylaw was void for uncertainty due to internal contradictions and vagueness. The test for vagueness was whether a reasonably intelligent person can make some sense of the bylaw. It was found that the bylaws were not vague, there was nothing in the bylaws that contradicted the Residential Tenancy Act, nor was there any difficulty interpreting the Bylaw. It was found that a reasonably intelligent person would be able to determine the meaning of the bylaw and govern his or her actions accordingly.

Second, the petitioners alleged that the Bylaw was ultra vires the enabling provisions of the Local Government Act. The municipality was entitled to deference on this point. The municipality’s reasons for concluding that it had authority to enact the impugned bylaws only needed to meet the test of reasonableness. The petitioners argued that the Bylaws were ultra vires because they restricted the ability of landlords to occupy residential premises. This argument was found to be faulty because the Residential Tenancy Act does not suggest that a municipality is unable to place additional restrictions or prohibitions on landlords’ rights to occupy residential premises.

Third, the petitioners relied on the Community Charter, SBC 2003, c 26, outlining that a provision of the municipal bylaw is of no effect if it is inconsistent with a provincial enactment. It was outlined that a finding of inconsistency is only available where there is an operational inconsistency between a municipal bylaw and legislation of senior level government. There was nothing in the bylaw inconsistent with the Residential Tenancy Act.

The appeal was dismissed.

This case was digested by Deanna C. Froese, and first published in the LexisNexis® Harper Grey Administrative Law Netletter and the Harper Grey Administrative Law Newsletter.  If you would like to discuss this case further, please contact Deanna C. Froese at [email protected].

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