Sun River Estates Ltd. v. Capital Regional District (Corporation),


2008 BCSC 1788

Date: 20081223
Docket: 06-2811
Registry: Victoria


Sun River Estates Ltd.



Corporation of Capital Regional District


Before: The Honourable Mr. Justice Masuhara

Reasons for Judgment

Counsel for the Plaintiff

G. N. Harney
P. F. Waller

Counsel for the Defendant

G. E. McDannold

Date and Place of Trial/Hearing:

April 21-25, July 31, 2008


Victoria, B.C.


[1]                The plaintiff, Sun River Estates Ltd. (“Sun River”), objects to being subject to the Capital Regional District’s (“CRD”) water Development Cost Charges (“DCCs”) in relation to its 715-lot residential land development project located in Sooke, B.C., called Sun River Estates (the “Development”).

[2]                The plaintiff claims that the CRD has been unjustly enriched by requiring the payment of water DCCs, after having required Sun River to replace an existing 200 mm water main with a new 300 mm diameter, 935 metre-long water main from Sooke Road along Phillips Road to the southern boundary of the Development (the “Phillips Road Pipeline” or “PRP”), to service the Development, to construct and install a reservoir and pump station at the Development site, and to transfer title of these works to the CRD as conditions to obtaining the necessary zoning and subdivision approvals to allow the Development to proceed.

[3]                The capital cost of the PRP was included by the CRD in its calculation of water DCCs subsequent to the zoning approval.  Having constructed and installed the PRP at its own cost, Sun River submits that it should have been provided a credit towards water DCCs in relation to the Development pursuant to s. 933 of the Local Government Act, R.S.B.C. 1996, c. 323.

[4]                The credit sought is in the order of $2.1 million, which is the sum of $391,000 incurred to install the Phillips Road Pipeline and $1.7 million incurred to build the reservoir and pump station.

[5]                Alternatively, Sun River argues that if the Development was incorrectly included in the service area for DCCs, Sun River should not be subject to DCCs and should be repaid the DCCs it has paid to Sooke, as well as relieved from paying any DCCs to the CRD Water Department for the balance of the Development.  In this regard, Sun River seeks an order excluding the Development from the CRD water DCC area.

[6]                Of the two remedies, Sun River prefers the former.

[7]                I note that as a result of closing arguments, the plaintiff’s position no longer included a claim that Bylaw 3100 was illegal for including a completed project in the capital cost calculation for DCCs.

[8]                The CRD, among its many other functions, is a licensed water supplier under the Drinking Water Protection Act, S.B.C. 2001, c. 9, responsible for ensuring water supply meets the requirements of that Act and its regulations.  A standing committee of the CRD is the Juan de Fuca Water Distribution Commission (“JFWDC”) whose members are elected local officials appointed by their respective municipality/electoral area to sit on the Commission.  The JFWDC members oversee the operations of the water distribution system servicing several municipal areas in the Capital Regional District.  The JFWDC is supported by the staff of the CRD Water Services department which has overall staff responsibility for water infrastructure in the CRD. 

[9]                The essence of the CRD’s defence is that Sun River entered into binding agreements to construct at its own expense and transfer over the subject facilities in order to obtain a rezoning bylaw, development permits and subdivision approvals which would allow the Development to proceed.  As a result Sun River has no basis for its claim.  The CRD also says that the PRP had been essentially completed by the time the bylaw that included the PRP costs in DDCs was passed and that it is only future projects that are to be included in DCC calculations.  The CRD says that the PRP was included in revised water DCCs in error, as its consultant who conducted the review of the DCC program was not aware that the PRP was under construction and was governed by separate agreements.  It notes that the inclusion of the PRP costs in the revised DCCs was corrected upon this realization.  With respect to the reservoir and pump station, the CRD relies on the fact that these works were never included in its water DCC program and were the subject of a separate agreement; as a result, Sun River is not entitled to DCC credits.

[10]            In addition to defences on the merits, the CRD raised the six-month limitation defence under the Local Government Act.


[11]            The questions that arise are:

1.         Was the defendant unjustly enriched?

2.         If so, what is the appropriate relief?

3.         Is the plaintiff barred by the six-month limitation period under s. 285 of the Local Government Act?

Development Cost Charge

[12]            The parties tendered at trial three provincial government publications:  Development Cost Charge – a Guide for Elected Officials, Development Finance Choices Guide, and Development Cost Charge Best Practices Guide

[13]            The first publication at page 4 states:

Development cost charges are fees that municipalities and regional districts choose to collect from new development to help pay the cost of off-site infrastructure services that are needed to accommodate growth.

Local governments are limited in the types of services they may fund using DCC revenues.  Specifically, DCCs may be used to help offset costs associated with the provision, construction, alteration or expansion of:

·                  roads, other than off-street parking;

·                  sewer trunks, treatment plants and related infrastructure;

·                  waterworks; and,

·                  drainage works.


DCCs are applied as one-time charges against residential, commercial, industrial and institutional developments.  DCCs are usually collected from developers at the time of subdivision approval in cases where such approval is required.  Where subdivision approval is not required, the charges are applied in the building permit approval stage.

[14]            At pages 7-10, it sets out the general approach to calculating DCC rates:

How are DCC rates calculated?

The calculation of DCCs brings together a number of pieces of information, including the:

·                     types, locations and amounts of growth that are projected to occur over a specified future period;

·                     infrastructure services required over the same period to accommodate the growth;

·                     estimated cost of the services;

·                     portion of the total cost to be paid by the existing population (which benefit from new infrastructure);

·                     relative impact of each type of growth on the services; and

·                     degree to which the existing users assist growth in paying its share of costs.

Approaches to calculating DCCs will vary to some extent by community.  It is possible, however, to outline a set of generic steps that are important to developing a DCC program.


·         STEP 1 - Project Future Growth

A local government begins the process by determining the amount of growth that is projected to occur over a specified future period of time (e.g., 5 years, 10 years, and 20 years).  Because DCCs are applied to actual development instead of new population, the amounts of the different types of development that are expected to occur are projected.  Most local governments project figures for various types of residential development (e.g., single family, townhouses, apartment), as well as commercial, industrial and institutional growth.

·         STEP 2 - Identify Required Works

Once growth has been projected, the local government determines the specific infrastructure works that will be required to accommodate the growth.  As noted earlier, DCCs can only be collected to help fund waterworks, wastewater projects, drainage works, major roads, and acquisition and development of parkland.  Other infrastructure services cannot be funded, in whole or in part, using DCC revenues, and are, therefore, not identified in the calculation.

·         STEP 3 - Estimate Infrastructure Costs

The infrastructure projects identified in Step 2 are costed in Step 3 of the process.  For DCC purposes, the total cost estimate for each project can include a variety of separate costs that will be incurred by the local government in providing the infrastructure.  Project costs related to the following activities may be included.


·     Planning

·     Public consultation



·     Engineering design

·     Right of way



·     Land acquisition

·     Interim debt financing



·     Contract administration

·     Construction



·     Contingencies

·     Legal review



·     Remittance of net GST



Long-term debt financing costs cannot be included in cost estimates for DCC projects.

·     STEP 4 - Allocate Costs to Growth/Existing Users

Not every project identified for DCC purposes will be required solely to accommodate growth.  Most, if not all, of the identified works will be deemed to benefit, and will be required by, both growth and the existing population.  Growth is expected to pay only for the portion of the works that it requires.  The existing population is expected to pay for the remaining portion using other sources, such as tax and utility revenues.

The costs of the DCC works are allocated between growth and the existing population on the basis of benefit.

·     STEP 5 - Assign Costs to Land Use Types

Once the infrastructure costs have been allocated between the existing population and growth, the portion attributable to growth is assigned to the various types of growth - residential, commercial, industrial, institutional - that are projected to occur.  Costs are assigned in a way that reflects the relative impact of each type of development on the works required.

·     STEP 6 - Convert Costs into DCC Rates

The assigned infrastructure costs are converted into actual DCC rates that can be charged to individual development projects.  The total cost assigned to each development type is divided by the number of development units (e.g., number of dwellings, square metres, hectares) expected over the DCC program time frame.  The result is a per unit charge that can be easily applied to individual developments as they occur.

·     STEP 7 - Apply Assist Factor

The final step in calculating DCCs is to apply the assist factor.  The assist factor is the contribution that the existing population must provide to assist future growth in paying its portion of the DCC infrastructure costs.  The assist factor is over-and-above the portion of the total infrastructure cost that is allocated to existing users in Step 4.

The assist factor reduces the DCC rates by the specific level of assist chosen.  Under the Local Government Act, the level chosen must be at least one percent.

[15]            At page 15 it states: 

Elected Officials

Municipal councils and regional district boards are responsible for the DCCs that are imposed on new development in their communities.  Given this responsibility, it is important for elected officials to be involved in setting the rates.

Councils and regional district boards have some specific responsibilities.  They must make decisions on a wide variety of issues — some of which have been discussed already — that arise during the DCC establishing process.  In making decisions, the elected officials rely on staff to identify options, outline implications and provide recommendations.

Elected officials are also responsible for ensuring that the DCCs reflect important best practices, as well as key principles such as fairness and equity.  Are the DCCs fair to both growth and existing ratepayers?

[16]            In Development Finance Choices Guide, DCC credits are discussed as follows at page 23:

DCC programs are intended to support broader local government growth management plans.  More specifically, a DCC program should be designed to provide servicing for new development in an orderly manner which is consistent with the growth-related objectives in the local government’s OCP.

In some cases, a developer may wish to proceed with a project before the required trunk services are installed in the particular development area.  The local government may decide that such an out-of-sequence development should not proceed, as it conflicts with the government’s growth strategy.  Alternatively, the local government may allow the project to proceed on the condition that the developer front-end the cost of constructing the necessary trunk services.

Developers who front-end the cost of constructing required trunk services in advance of their proposed timing would be entitled to a DCC credit.  Put differently, the cost of constructing the required trunk services would be deducted from the DCC amount that would otherwise have been collected from the developer for the particular class of service.  For example, if the developer constructed a section of trunk sewer, the associated capital costs would be deducted from the developer’s sewer DCCs, to the maximum DCC amount payable.


DCC credits and rebates arise when local governments agree to allow developers to finance the cost of trunk works identified in the local government’s DCC program.  The DCC credit that a local government offers would be determined by the cost of the trunk works, to the maximum DCC amount payable by the developer.  The DCC rebate would be determined by the incremental portion of costs beyond the local requirement.

It is important to note that DCC credits and rebates can only be given for trunk works that are included in the DCC program.  [Emphasis added]

[17]            In Development Cost Charge Best Practices Guide, the guiding principles to be followed in the development of a  DCC bylaw are indentified at page 2 as integration, benefiter pays, fairness and equity, accountability, certainty and consultative input.  Policy decisions by a local government regarding the development of a DCC program are discussed.  The guide states at page 47:

Prerequisite Policy Decisions

The development of a DCC program will depend in part, on how the policy issues described in Part 1 – Guidebook of this Best Practices Guide have been considered.  Before a DCC program can be compiled, the following questions must be answered satisfactorily.

1.      How extensive will DCCs be applied, on a municipal-wide basis or area-specific basis?

2.      What time frame has been established for the DCC program (i.e. on a revolving or build-out basis)?

3.      What type of projects can be included in a DCC program?

4.      What project costs are DCC recoverable?


[18]            The witnesses in this case were:

·                     Mr. Anthony Young, holder of a one-fourth interest in the Development.  He described his role as an expediter and coordinator for the Development.  He is a real estate developer having some forty years of experience, including considerable experience with subdivision and DCCs. 

·                     Mr. Steve Shambrook, secretary of Sun River and manager of the field crews of the Development, as well as coder of payables related to the Development.  He has been involved with the Development since the start and provided evidence regarding the physical systems related to the Development.

·                     Mr. Gary Smirfitt, professional engineer with some thirty-six years experience in municipal engineering including DCCs.  He started as a contract engineer with Sooke in 2001 and in 2002 became their municipal engineer.  In 2003 he was given the additional responsibility of being an alternate approving officer.  He advocated for a DCC credit to be granted to Sun River in his capacity as a representative of Sooke.  In May 2005 he left the employ of Sooke and became a consultant, providing advice on municipal matters including DCCs.

·                     Mr. Jack Hull, general manager of CRD Water.  He has held this position since 1992 and reports to the Chief Administrative Officer of the CRD.  He has overall responsibility for the management of CRD Water including DCC related matters.

·                     Mr. David Kersop, a professional engineer with Urban Systems.  His practice is focussed on the development of DCCs and related bylaws for municipalities.  He prepared the underlying analysis and recommendation for the JFWDC DCCs in 1999 and 2003 and explained the purpose of DCCs and the approach taken in DCC studies that he undertakes.  His approach includes a review of the official community plan of a municipal region, land use, population patterns, and proposed developments and the improvements and related costs that will be required to meet the growth.  He testified as to the approach he took in regard to his report in 1999 and his approach in 2003.

Facts and Chronology

[19]            On August 9, 2000, after a comprehensive consultation process, the CRD adopted Bylaw No. 2758 that established its first water DCC program.  The bylaw imposed water DCCs in Langford, Sooke, View Royal, Colwood and Metchosin and set the rate for water DCCs at $1,848 for single family residential units.  The recommendation accompanying the program was that it be reviewed every three to five years.  The Development was not included in the DCC service area.

[20]            In early 2001, the Municipality of Sooke adopted an Official Community Plan.  The Development area was identified as an urban growth area.  During this same period, Sun River acquired five parcels of land (approximately 380 acres) located in Sooke called the Phillips Farm for approximately $2 million.  The land was farmland and not serviced by a community water service.  The land was not within the DCC service area. 

[21]            The real estate market at that time was buoyant.  The owners of Sun River wished to proceed with the Development which included obtaining approval for rezoning and subdivision.

[22]            Sun River retained Focus Corporation Ltd. (“Focus”), a consulting engineering firm, as its consultants for the Development.  Mr. Young testified that Sun River had retained this firm to represent it in all matters related to the Development.

[23]            On March 27, 2002, the CRD amended Bylaw No. 2758 by adopting Bylaw No. 2960.  The amendment revised the rates for DCCs.  The Development was again not included in the water DCC service area, and infrastructure for the supply of water to it was not included in the calculation of DCC rates.

[24]            On May 2, 2002, in response to an enquiry from Focus, CRD advised Focus of DCC Bylaw No. 2758 that indicated DCCs are assessed on the basis of location, and that if Sun River’s property was not within the DCC service area, a DCC was not chargeable.

[25]            In June 2002, an Official Community Plan Amendment (the “OCP Amendment”) and Rezoning Report for Sun River Estates (the “Rezoning Report”) was submitted by Sun River to the District of Sooke in support of an application for rezoning and designation of the Development as a Comprehensive Development Area.  The Rezoning Report detailed the proposed development and provided a comprehensive plan as to how the development would proceed, including a plan for a water system to the development stipulating “the connection point to the CRD system for Sun River Estates would be on Phillips Road, approximately 300 metres from the property boundary.”

[26]            At that same time, a copy of the Rezoning Report was submitted by Sooke to the CRD.  On June 18, 2002, the CRD responded to Sooke stating that:

[I]f the water department receives an appropriate application to supply water, and if the owner(s) is prepared to pay the necessary costs and fees as authorized under CRD Bylaw No. 2746 community piped water can be supplied to this property.  The nearest connection point to the water distribution system is at the end of the existing water main on Phillips Road approximately 300 metres south of the subject property

[27]            Sun River accepted the condition that it would be responsible for providing water and any upgrades necessary to provide water at its cost in order to obtain the rezoning approval necessary for the Development to go ahead.

[28]            A public hearing of the Sun River rezoning application by Sooke was held September 9, 2002. 

[29]            In October 2002, a Land Development Agreement (the “Development Agreement”) was entered into by the District of Sooke and Shambrook Hills Development Corp. (the then name of the Development owner).  Pursuant to the Development Agreement, Sun River planned on developing approximately 715 lots and agreed to donate approximately 22% of the Development lands (83 acres) for parks, trails, an allotment garden, a school site, soccer and baseball fields, and other green spaces for use by the Sooke community.  The services to these donated areas were to be serviced by the infrastructure constructed and installed by Sun River for the Development.

[30]            The Development Agreement also provided in section 7.6 that:

The Owner shall construct a water supply system including hydrants and water storage reservoir as required to meet Municipal Specifications and the requirements of the Water Department of the Capital Regional District.

[31]            The Development Agreement was registered against the Development lands as a s. 219 Land Title Act, R.S.B.C. 1996, c. 250, covenant on December 3, 2002.

[32]            The Development Agreement makes no reference to the treatment of DCCs relative to water works (the Development was not in the CRD water DCC area), but does with respect to road development DCCs.  Section 6.1 provides that:

The Municipality acknowledges that the provision of the Works would entitle the Owner to a setoff from road development cost charges should the Works be included among the projects for which road development cost charges are imposed under [the Local Government Act].

[33]            On October 2, 2002, the JFWDC, with CDR Water staff including general manager Jack Hull in attendance, passed a motion that the JFWDC undertake a review of Bylaw 2758 in the New Year.

[34]            On November 25, 2002, Sooke adopted Bylaw 102 to effect the rezoning applied for by Sun River.

[35]            On January 7, 2003, the JFWDC received a staff report prepared by CRD Water, including Mr. Hull and Peter Malone, Manager, Technical Services.  The staff report identified as an option for prepayment a situation in which the developer volunteers to build the necessary infrastructure and receives DCC credit for the capital cost of the constructed works.  The report noted that two developments in Langford that were within the DCC collection area, Bear Mountain and Eagle Ridge, were nearing the stage where DCC works would be required and that the projects required “funding that exceeds the money expected to be available from the DCC reserve fund when the infrastructure is needed”.  The JFWDC discussed the report and passed a motion directing that staff meet with developers to explore options for prepayment of infrastructure costs. 

[36]            On January 9, 2003, Mr. Roberts of Focus requested Mr. Keenan of CRD Water, Mr. Smirfitt of Sooke, and Mr. Shambrook to attend a meeting regarding matters related to the water requirements of the Development, including “reservoir issues, existence of low pressures near the site, DCCs and any other particular requirements that CRD, the District of Sooke or our client may have related to the project.”

[37]            On February 4, 2003, the JFWDC, with Mr. Hull and Mr. Malone present, discussed a review of its DCC program and directed its staff to address issues such as:

·                     Status of the current DCC program;

·                     Boundaries of current DCC areas, including whether East Sooke should be included;

·                     Changes to Official Community Plans since the initial study was conducted;

·                     Effect of the unsuccessful borrowing referendum; and

·                     Effect of DCCs if the District of Highlands becomes a customer member.

[38]            On February 28, 2003, a meeting was held between CRD representatives and Mr. Shambrook of Sun River and Focus.  The discussion as reflected in the meeting minutes, drafted by Mr. Roberts of Focus, included details of a 300 mm water main along Sooke Road to the Development, recognition that Sun River was out of the DCC service area, and comments that the JFWDC may update an earlier report on DCC areas in the future.

[39]            On March 4, 2003, the JFWDC received a report titled DCC Program Review, prepared by Mr. Hull and Mr. Malone.  The report referred to changes in potential service areas, and made specific reference to Sun River Estates not having been included in the original study underlying the existing DCCs.

[40]            On March 10, 2003, Sooke issued a development permit for Sun River.

[41]            On April 1, 2003, the JFWDC received a staff report which stated that a full public review would be required if changes in service areas included incorporating new areas into the DCC Program.  The JFWDC awarded Urban Systems a consulting contract to review DCCs and update Bylaw No. 2758.

[42]            On May 9, 2003, Mr. Kersop contacted Mr. Douglas of Focus Engineering by email advising him that Urban Systems was “reviewing the distribution system for the CRD Water Department in the Western Communities” and that he was requesting information with respect to “the siting and sizing of on-site reservoirs and distribution mains”.  He noted he was contacting Focus because “Focus is the engineer for two significant developments in [sic] that will impact on the planning of distribution system improvements – Sun River Estates in Sooke and Bear Mountain Resort in Langford”.

[43]            Mr. Kersop was not advised in any of his communications with officials of Sooke or with Focus that Sun River was to build the PRP pursuant to the Development Agreement; nor was he advised that it was actually under construction and was nearing substantial completion by the time the Urban Systems review was presented to the board of JFWDC on July 8, 2003.

[44]            In early May 2003, Sun River commenced construction of the PRP.  Actual construction was largely completed in June 2003; it was pressure tested and passed on June 10, 2003; and connected to the CRD water system on July 14, 2003.  A temporary pipe over a bridge to the Development was installed to service the Development in July.  The crossing was completed later in the fall.  The final inspection of the facilities was conducted on July 17, 2003.  Deficiencies were corrected by July 22, 2003.  The completion certificate was filed by Focus on November 28, 2003.  “As built” drawings were delivered to the CRD on December 2, 2003, and the project was formally deemed completed on January 8, 2004.

[45]            On June 3, 2003, the JFWDC received a staff report from Mr. Hull and Mr. Malone concerning the DCC review.  The report stated: 

A large sector of land north of Phillips Road and adjacent to the west bank of the Sooke River has been added as a comprehensive development area, which will include 715 residential units.  The new municipal boundary excludes a significant portion of land to the west that was to be serviced by a new reservoir, and the consultant is recommending that this be deleted from the DCC program.

[46]            On July 8, 2003, the JFWDC held a meeting in which Mr. Kersop reviewed his draft report regarding DCCs.  New included areas were highlighted including Sun River Estates.  The JFWDC debated the recommendations in the draft and resolved inter alia to: 

·         Receive the report of Urban Systems;

·         Maintain uniform development cost charges across the entire area;

·         Approve DCCs at $1,981 per residential unit.

[47]            In its final report dated July 24, 2003, Urban Systems provided recommendations to the JFWDC, including expanded service areas for Sooke and Langford and revisions to the existing rates.  The net amount for infrastructure to be collected by DCCs was determined at $34,284,256.  The comparable amount set out in the 1999 report was $33,660,305.  The report noted that the Sooke Official Community Plan identified the Sun River Development and stated the need to plan for the extension of the water system to Sun River Estates.  The Phillips Road water main was identified as one means of delivering water to the Development.  The report also noted that the developer proposed to construct a reservoir and pump station to service future phases of the Development.  The report at page 6 stated:

It is unlikely that community water will be extended beyond the boundaries for Sun River Estates as it is at the northern extremity of the Urban Containment Boundary for Sooke.  For this reason we propose to include only those works which bring water to the development boundary into the DCC Program.  A 350 diameter water main along Phillips road to the boundary of the development is proposed for this purpose.  The developer will remain responsible for all on-site distribution works including the booster pump and reservoir.

[48]            The inclusion of Sun River into the DCC service area and the PRP in the DCC rate calculation was reflected in CRD Bylaw No. 3100.  This bylaw received all three readings at the CRD board meeting on September 10, 2003.  The Inspector of Municipalities approved the amendment on December 10, 2003, and the bylaw was formally adopted January 14, 2004.  As stated earlier, the PRP was operational in July 2003 and formally deemed completed on January 8, 2004.

[49]            On October 3, 2003, Mr. Shambrook, on behalf of Sun River, signed a Water Main Connection and Extension Agreement with the CRD for the PRP, allowing it to expand the CRD water system at Sun River’s expense in order to service the Development.  It contained no provisions dealing with DCCs.

[50]            On November 28, 2003, Mr. Gottfred of Focus certified to the CRD that the PRP was complete and recommended the works for approval of the construction completion certificate by the CRD.

[51]            On December 2, 2003, the CRD received the required documentation from Focus including Statutory Declarations and “as built” drawings. 

[52]            On January 8, 2004 the PRP project was formally declared completed and accepted by the CRD.

[53]            On January 26, 2004, Mr. Smirfitt wrote to the CRD indicating that it was his opinion that Sun River would be entitled to a DCC credit of $635,000, since it had paid for and installed the Phillips Road Pipeline.  Sun River was aware of this issue and agreed with Mr. Smirfitt’s position.  The CRD denied a DCC credit.

[54]            From February to July 2004, communications between the parties continued.  Sooke maintained that Sun River should be entitled to the DCC credit of $635,000.  By letter dated July 13, 2004, Mr. Hull reiterated to Mr. Smirfitt that the PRP had been erroneously included as a DCC project as it had already been constructed by the time the bylaw had been adopted and that DCCs were to be collected from Sun River.  He also noted that the actual cost of the PRP was $195,408 as opposed to $635,000.  The mayor of Sooke and Sun River were also copied on this letter.

[55]            The CRD moved to amend the bylaw by removing the cost attributable to the subject water main and to update it for the increase in construction costs generally.

[56]            On September 7, 2004, Mr. Hull reported at a meeting of the JFWDC that the “waterline for [the Development] was built before the DCC was in place and therefore should not be included in the calculations”.  The mayor of Sooke was in attendance at the meeting as a Commissioner.

[57]            On September 27, 2004, Urban Systems amended its report of July 24, 2003 regarding its recommendations for DCCs for the JFWDC.  The net amount for projected infrastructure to be paid by water DCCs was changed to approximately $32 million.  The amendment specifically removed the PRP from the DCC program. 

[58]            On October 27, 2004, CRD Bylaw No. 3218 passed all three readings.  The bylaw amended the DCCs to reflect the removal of the PRP.  It appears the mayor of Sooke as a CRD director moved to have the bylaw pass each reading.  The Inspector of Municipalities was aware that no public consultation had taken place.  On April 22, 2005, the bylaw took effect with the approval of the bylaw by the Inspector of Municipalities. 

[59]            On March 4, 2005, the CRD offered not to charge Sun River $36 per lot in DCCs arising from the erroneous inclusion of the PRP.  Both Sooke and Sun River rejected this offer.

[60]            On March 8, 2005, Sun River commenced construction of the pump station and reservoir.  The CRD accepted transfer of the facilities on September 7, 2007.  The total cost of the project amounted to $1,981,512.06.

[61]            The reservoir and pump station costs were never included in the DCC program.

[62]            At another nearby development called Bear Mountain, a reservoir was being constructed by the developer who was provided a water DCC credit of $4.4 million (the cost of construction) pursuant to a negotiated agreement.  However, that development was in the DCC collection area in which water DCCs were already in effect.

[63]            On September 30, 2005, Sun River signed a second water connection extension agreement with the CRD, agreeing to construct at its own cost the reservoir and pump station and to transfer them to the CRD upon completion.  The Sooke Subdivision Approving Officer had made the construction of the reservoir and pump station a condition of Sun River’s subdivision approval for Phase 2 which Sun River accepted.  The capacity of these facilities was drawn by Sun River’s consultants to meet the specifications required by the CRD to serve the Development.  The service was not designed to provide capacity beyond that required by Sun River. 

[64]            On March 1, 2005, Mr. Smirfitt wrote to the CRD advising that the position of Sooke remained as it had earlier set out; namely, that Sun River was entitled to a DCC credit of $635,000 and that DCCs would be collected once this credit was used up.

[65]            On March 4, 2005, Mr. Malone, Manager of Engineering and Planning for the CRD, wrote to Mr. Smirfitt advising that the CRD:

was in agreement that the cost of the works on Phillips Road constructed prior to including Sun River Estates in the DCC area must be deducted from the DCC.  However, deducting the cost of the works does not entitle Sun River Estates to a credit of the cost of the works, but to the difference between the DCC including the Phillips Road pipeline and the DCC excluding it.  This results in a difference of $36.26, reducing the DCC from $1,981.00 to $1,944.74. We will apply this reduced rate for the period from January 14, 2004 until the revised bylaw is adopted.

[66]            On March 23, 2005, the solicitors for Sun River advised the CRD in writing that Sun River concurred with the position of Mr. Smirfitt that no further payment of DCCs by Sun River was required.

[67]            On April 7, 2005, the solicitors for Sooke provided an opinion on the application of the CRD water DCC to Sun River.  The opinion supported the earlier stated position of Sooke.

[68]            On November 24, 2005, the solicitors for Sun River wrote to the solicitors for the CRD, referencing the various letters that had passed between Sooke and the CRD and the opinion of Sooke’s solicitors stating that the “DCC by-law was flawed”.

[69]            On December 12, 2005, Sun River paid the first of the water DCCs.  Sun River objected to paying the DCCs.  Mr. Young voiced his objection to Mr. Hull who advised him to pay, with resolution of the dispute to be dealt with at a later time.  Sun River as a result made its payments but under protest.

[70]            In total, Sun River paid a total of $1,994.30 as a result of the inclusion of the PRP.  The CRD collected a total of $30,235.29 as a result of the error.  The period in which the PRP was included in the DCC calculation was from January 13, 2004 to April 27, 2005.  This incremental amount in the rate for the PRP as noted earlier was $36 per lot.

[71]            The present action was commenced on June 20, 2006.

Agreed Statement of Facts

[72]            The following are agreed facts which I have reproduced as provided by counsel:

(a)        The parties knew what the “works” were.  The “works” (water main, reservoir and pump station) have now been built.  They have been completed with “as built” drawings submitted to CRD and turned over to the CRD, in accordance with the two contracts.

(b)        The capacity of the “works” was designed by the consultants for Sun River to meet the specifications required by the CRD to serve Sun River.  The service was not designed to specifically provide excess capacity beyond Sun River.  Design and building of Phillips Road water main, reservoir and pump station would have been no different without properties connected to Sun River. 

(c)        The capacity of the Phillips Road northern extension was designed to service Sun River, which includes the school property.

(d)        The three pressure-reducing valves would be required to serve Sun River even if there were no water users south of Sun River.

(e)        Sun River paid $1,994.30 in water DCC charges related to the DCC calculation error including the Phillips Road water main.

(f)        The total amount of DCCs collected by the CRD in relation to same error was $30,235.29.

Unjust Enrichment

[73]            For the reasons that follow, I conclude that the CRD was not unjustly enriched.

[74]            The test for unjust enrichment has three well established elements:

(a)        an enrichment of the defendant;

(b)        a corresponding deprivation of the plaintiff; and

(c)        an absence of juristic reason for the enrichment.

[75]            In this case, the existence of an enrichment and a corresponding deprivation is questionable.  Sun River argues that the CRD has been enriched by the transfer of the subject works which have a value in excess of $2 million.  It also argues that the CRD was further enriched by the DCCs which Sun River has paid and will pay into the future.  The corresponding deprivation is the transfer of the subject works to the CRD and the payment of DCCs.  I do not accept the CRD’s argument that any enrichment is reduced by the “ongoing liabilities and costs in maintaining and replacing the infrastructure which has been transferred to it”; this argument was rejected in Pacific National Investments Ltd. v. Victoria (City), 2004 SCC 75, 245 D.L.R. (4th) 211, at para. 19.  The key fact remains that Sun River obtained the zoning change, the development permit, and subdivision approvals in exchange for being financially responsible for the construction and installation of the subject works and transferring the works over to the CRD upon completion.  While Sun River has been subject to paying DCCs and will be in the future, there was no agreement that Sun River would be insulated from paying DCCs.  It seems that the first two conditions for unjust enrichment have not been met.  However, even if they have been met by reason of the payment of DCCs, there remains the inquiry as to whether there is an absence of a juristic reason for the enrichment.  In this regard, I find that the plaintiff has not met the onus of proving that there is no juristic reason.

[76]            This inquiry has two stages.  They were recently reiterated in Pacific National Investments Ltd., at paras. 23 and 25:

[23]      At the first stage, a claimant…must show that there is no juristic reason within the established categories that would deny it recovery.  The established categories are the existence of a contract, disposition of law, donative intent, and “other valid common law, equitable or statutory obligatio[n]” (Garland, at para. 44).  The categories may be added to over time (para. 46).  On proving that none of these limited categorical reasons exist to deny recovery, the plaintiff… will have made out a prima facie case of unjust enrichment.  It will have demonstrated “a positive reason for reversing the defendant’s enrichment” (Smith, supra, at p. 244).


[25]      At the second stage, the onus shifts to the defendant…, who must rebut the prima facie case by showing that there is some other valid reason to deny recovery.  In the absence of a convincing rebuttal, the transfer of wealth will be reversed.  According to Garland, it is at this stage that the court should have regard to the reasonable expectation of the parties and public policy considerations.

[77]            The juristic reasons identified by the CRD that negate Sun River’s claim are:

1.         The Development Agreement;

2.         Registration of the Development Agreement as a covenant on Sun River’s land under s. 219 of the Land Title Act;

3.         The two water main extension agreements between Sun River and the CRD;

4.         The conditions of the subdivision approving officer’s approval;

5.         The donative intent represented in Sun River’s rezoning proposal to Sooke; and

6.         The scheme of the Local Government Act and the CRD policy that developers — not taxpayers in the community — are responsible for extending the water supply system to their development and for installing all works and services within their development.

[78]            The plaintiff acknowledges that it agreed to construct the PRP, the pump station, and reservoir at its own expense and hand ownership over to the CRD.  However, it submits that its agreement to do so did not address DCCs and that there was no agreement by which it could be said that Sun River waived its entitlement to a DCC credit. 

[79]            The relevant provisions relating to DCCs and credits are ss. 933(1) and (8) of the Local Government Act, which state:

933  (1)            A local government may, by bylaw, for the purpose described in subsection (2) or (2.1), impose development cost charges on every person who obtains

(a)        approval of a subdivision, or

(b)        a building permit authorizing the construction, alteration or extension of a building or structure.

(2)        Development cost charges may be imposed under subsection (1) for the purpose of providing funds to assist the local government to pay the capital costs of

(a)        providing, constructing, altering or expanding sewage, water, drainage and highway facilities, other than off-street parking facilities, and

(b)        providing and improving park land


(8)        Despite a bylaw under subsection (1),

(a)        if an owner has, with the approval of the local government, provided or paid the cost of providing a specific service, outside the boundaries of land being subdivided or developed, that is included in the calculations used to determine the amount of a development cost charge, the cost of the service must be deducted from the class of development cost charge that is applicable to the service ....

[80]            Sun River argues that the CRD had known for approximately one year that the DCC bylaw would be updated and that it would affect Sun River, yet it took no steps to notify Sun River of this, even when entering into the agreement.  The CRD board knew that Bylaw No. 3100 had already passed three readings and that the PRP was included in the capital cost calculation, yet it did not inform Sun River of this.  In effect, Sun River argues that CRD took advantage of Sun River by not paying for the PRP, reservoir and pump station and yet obtaining the payment of DCCs. 

[81]            The plaintiff submits that CRD cannot rely upon the Local Government Act for authority to collect DCCs and then ignore s. 933(8) of the Act, which makes the granting of a DCC credit to Sun River mandatory.  It argues that s. 933(8) fully contemplates a situation as in the instant case where a project that is included in the capital cost calculation is constructed by the developer and the “burden imposed on the developer by front ending the capital costs of these services is essentially the consequence of ‘advancing history’” (Development Cost Charges Best Practices Guide, at page 31).  Sun River submits that the intent of s. 933(8) is to prevent a developer from being double charged.

[82]            In regard to donative intent, Sun River submits that it negotiated agreements with CRD with the expectation that it would not be paying DCCs and that it was CRD who entered into the agreements knowing that Sun River would soon be subject to DCCs.  Once put into the DCC service area, Sun River expected, it argues, to receive a DCC credit for the PRP, reservoir and pump station.  These credits were never intended to be donated as credits to CRD.

[83]            The plaintiff submits, with regard to reasonable expectations, that it did expect to pay the cost of the PRP, reservoir and pump station at a cost of approximately $2.1 million, but it did not expect to also pay DCCs amounting to an additional $2 million.  Sun River argues that its expectation is based on its dealings with the CRD, which said nothing about the looming changes reflected by Bylaw 3100 (passed some six days after the completion of the PRP), and the provisions of the Act which prohibit double charging.

[84]            The plaintiff argues that it is inequitable, unjust and unfair for CRD to attempt to take advantage of the delay in passing the bylaw, and to use misleading and inaccurate information provided to the Ministry to have the PRP removed in the 2005 Bylaw, in an effort to gain a windfall at the expense of Sun River.

[85]            Turning to the interpretation of s. 933(8), I agree with the submission that the section is to prevent double charging.  Applying the approach set out in Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559 where the court adopted Driedger’s formulation for statutory interpretation at para. 26:

Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.

[86]            I am not persuaded by the CRD’s argument that the opening words of s. 933(8), “Despite a bylaw under subsection (1)”, requires that a DCC bylaw must be in effect before a deduction “from the class of development cost charge” is permitted.

[87]            The requirement by a local government that a developer pay for a specific project and require that developer to pay that portion of the DCC that includes the specific work project cost is what is to be avoided, as it amounts to charging twice for the same costs.

[88]            A key pre-requirement of s. 933(8), however, is that the cost of the specific service provided or paid “is included in the calculations used to determine the amount of a development cost charge.”

[89]            Further, it is apparent that DCCs are to relate to future infrastructure requirements that have been identified for the program.

[90]            In this case, the Development was not in the DCC service area at the time the zoning or development permits were approved; nor was it when construction of the PRP commenced. 

[91]            The PRP was connected to the CRD water system and largely completed by the time Urban Systems’ draft report was presented to the JFWDC.

[92]            On the evidence, I find that the inclusion of the PRP in the DCC calculation was an error as stated by witnesses of the CRD.  I accept the CRD’s position that the PRP was not a future requirement.  I do not find that the evidence supports allegations of bad faith on the part of the CRD, such as the CRD hiding information from Sun River or that it intentionally delayed its bylaw as Sun River suggested.  Section 4.01 of the Urban Systems 2003 report supports Mr. Kersop’s lack of knowledge about the progress of construction when it states:

There is a need to plan for the extension of the water system to Sun River Estates.  There is presently no watermain in vicinity of the development that is adequate to deliver water to this site.  One option is to extend a watermain along Phillips Road to the boundary of the site.

[93]            The reality was that a water main was actively under construction and nearing completion.

[94]            It is apparent that the DCC review process was proceeding independently of the CRD’s arrangements for managing the infrastructure for the Development.  The PRP was included in the DCC calculation by Mr. Kersop.  He testified that he did not include projects in DCC programs if such projects were under construction or completed.  Mr. Kersop stated that he included the PRP because he did not know that construction of the PRP had commenced.  He testified that he also would not have included the PRP had he known that agreements had been entered into between the CRD and Sun River in respect to the subject infrastructure.  Neither Sooke officials nor Sun River’s consultants advised Mr. Kersop that the PRP was under construction or was subject to an agreement under which Sun River was to bear the cost of installing the PRP.  He further testified that he had always included future projects and had never encountered a situation where a project had been retroactively included.  He also stated that he had never included facilities such as the reservoir or pump station where the functions of such facilities were for a specific development.

[95]            Mr. Smirfitt acknowledged Mr. Kersop as an expert in the area of DCCs in British Columbia.  Mr. Smirfitt agreed that the purpose of DCCs is to fund future capital projects.  Mr. Kersop was a credible witness, and I accept his evidence that his inclusion of Sun River into his DCC rate calculation was an error, as well as his explanation of when projects are and are not included in DCC programs. 

[96]            It seems that Mr. Hull and his staff failed to connect the effect of the recommendations in the Urban Systems report to the Development.  I was somewhat surprised by Mr. Hull’s lack of knowledge as to various important aspects regarding DCCs and the CRD’s process regarding them.  It is a rather basic proposition that important reports, particularly those being presented to elected officials, be properly reviewed by the responsible senior executive before they are presented.  However, it was clear that an agreement was in place whereby Sun River was to bear the cost of constructing the PRP and to hand it over to the CRD. 

[97]            In any event, upon being notified by Mr. Smirfitt that a credit ought to be provided to Sun River, the CRD noted its error and proceeded to adjust the DCC rate to correct for the error. 

[98]            In the result, the argument for a credit under the wording of s. 933(8) does not assist Sun River.

[99]            Other aspects of this case militate against Sun River’s position. 

[100]        Mr. Young agreed there is no obligation on local government to supply community water at the cost of the local government or its taxpayers to a property which is separated from the existing community water service.  Mr. Hull testified that the CRD is not in the business of expanding the water supply system for developers.  He stated that it is the developer’s responsibility to do so at its own cost and was not challenged on the point.  I also note that Sun River sought to move ahead with the Development in advance of an upgrade of the existing water main along Phillips Road by the CRD.  It sought a zoning approval for its Development and entered into agreements to construct the PRP at its cost, to transfer the facilities to the CRD, and to do the same regarding a pump station and reservoir. 

[101]        As well, the Development was planned to proceed in phases.  Each phase of the Development required a separate application for approval.  Mr. Young agreed that the obligation to pay DCCs was triggered upon the approval of each subdivision.

[102]        I do not find the evidence supports a finding of bad faith on the part of the CRD regarding the timing of the bylaw, or that the CRD delayed the passage of Bylaw No. 3100 to disadvantage Sun River.  No irregularity in the timing process was established.  I recognize that the information provided to the office of the Inspector of Municipalities limited.  However, considering the entirety of the evidence, particularly Sun River’s agreement to bear the cost of the PRP and Mr. Kersop’s testimony that he would not have included it in his revision had he known that the PRP was subject to a separate agreement on the cost responsibility for it and that it already was under construction and significantly complete by the time he presented his report, the allegation of Sun River has not been made out.

[103]        The pump station and reservoir were never included in the DCC rate calculation and do not qualify for a credit.  While there was considerable exploration at trial of the operational aspects of the PRP, pump station and reservoir, and the service provided to users outside of the Development (including operational benefits to the water system as a whole), the critical fact is that these works were designed specifically to serve the Development.  While there are similarities with Bear Mountain there are also some key differences:  the Bear Mountain reservoir was designed for usage beyond its development; the Bear Mountain development had been included in the DCC service area; and the entitlement to DCC credits related to Bear Mountain was a specifically negotiated term.

[104]        Ultimately, the inclusion of facilities in a DCC program and extent of a service area is a policy decision that rests with the CRD.  In this case, the CRD extended the service area to include the Development, among other areas.  The CRD recognized the error in including the PRP and rectified its water DCCs to reflect this view.  As well, the reservoir and pump station were not included in the program.  These are policy decisions that are within the domain of the CRD and no defects in the decision, including fairness and equity, warranting court intervention have been made out.

[105]        Sun River also complains that it was not adequately consulted regarding the DCC review.  However, the CRD points out that the consultation referred to in the materials published by the provincial government is only a guide and not mandated.  I was not impressed by Mr. Hull’s justification that consultation was not necessary because the impact of the change was relatively minor.  The CRD’s own Practice & Procedures Manual (for which Mr. Hull wrote the introduction) states that major amendments to a bylaw or the DCC program include:  (a) significant land use changes in the Member Municipalities; (b) the preparation of new major servicing plans; and (c) changes to the area of the service areas.  However, the CRD points to Practice No. 1.3 of the Practice & Procedures Manual, which states that “the CRD shall consult with Member Municipalities before making any major amendments to the Program and the Bylaw”.  The CRD did consult with Member Municipalities including the District of Sooke.  I accept Mr. Hull’s evidence that he expected Urban Systems to discuss with Focus the examination of the service area including Sun River.  The CRD advised Sun River through its consultant that the CRD may be updating its DCC areas in a meeting that specifically included a discussion of DCCs, as evidenced by written meeting minutes drafted by Mr. Roberts of Focus.  For some unexplained reason, no action was taken by Sun River or Focus regarding this information.  Nor did Sun River take any action when Urban Systems contacted Focus in May 2003 inquiring about the water system for Sun River.  It seems that an experienced developer or its consultant would be sensitive to risks that could impact the economics of its project.  A communication that DCC areas may be updated and a communication from Urban Systems, particularly Mr. Kersop, should have raised a flag at Focus and Sun River.  I note that Sun River did not call a witness from Focus to shed light on this.

[106]        I find it relevant as well, though it was not specifically referred to at trial or in submissions, that the Practice & Procedures Manual also provides discretion to the CRD and its General Manager to deal with the issue of credits.  Practice Number 3.3 states:

The CRD has not made any provisions for the deduction, credit or rebate for projects in the Program which are done by persons other than the CRD.

j)          If a situation occurs which gives rise to the potential for the deduction, credit or rebate for such projects, the CRD may negotiate a separate agreement between the various parties.

If a developer or Member Municipality wishes to proceed with a land development prior to the installation by the CRD of the required water facility, the General Manager, Regional Water Supply has the authority to decide how to deal with the situation.

[107]        There is little doubt that agreements were put in place to deal with the installation of works and that no provision for credits or rebates was made.

[108]        In terms of donative intent, the transfer of the works to the CRD was part of the consideration for the zoning and other permits required for the Development.  Sun River acknowledged that a licensed water supplier had to operate the works and that it was not so licensed.

[109]        The instant case is distinguishable from the two principal cases cited by Sun River to support its unjust enrichment claim:  Bond Development Corp. v. Esquimalt (Township), 2006 BCCA 248, 52 B.C.L.R. (4th) 243 and Pacific National Investments Ltd.  In both cases valuable services were provided by the aggrieved developer.  The municipality in each cases took the benefit of the contribution by the developer but did not provide or reneged on providing the contemplated corresponding benefit back.  That is not the situation in this case.  Sun River received its rezoning, subdivision approvals and water supply in exchange for bearing the costs for the subject works and handing them over when completed.  This transaction was in accordance with the agreements into which Sun River had entered.

[110]        While it is unfortunate that more was not done by the CRD and its staff regarding consultation with Sun River, the circumstances as I have reviewed above, including the communications from the CRD and its consultant to Focus and Sun River, the Development Agreement, the two water extension agreements, the experience of the Sun River developers and their consultant, Sun River’s failure to contractually cover off the risk of being included in the water DCC service area, and CRD’s decision not to include the PRP (except in error), reservoir and pump station in the water DCC program, do not warrant intervention by the court. 

[111]        On the evidence, I am not persuaded that Sun River has established that it had a reasonable expectation that extended to being provided DCC credits in relation to the PRP, reservoir or pump station, or that the Development would not be included in the CRD water DCC service area.

[112]        In sum, Sun River has not established that there is an absence of juristic reason for the alleged enrichment.

[113]        Given the foregoing, the plaintiff’s claim of unjust enrichment has not been established and the action is dismissed, except to the extent that the agreed amounts of $1,994.30 and $30,235.29 are to be returned as a result of the inclusion error.

Limitation Defence

[114]        My consideration of the CRD’s limitation defence and the arguments of the parties leads me to conclude that the action would be barred based on s. 285 of the Local Government Act

[115]        Section 285 states:

All actions against a municipality for the unlawful doing of anything that

a)                  is purported to have been done by the municipality under the powers conferred by an Act, and

b)                  might have been lawfully done by the municipality if acting in the manner established by law,

must be commenced within 6 months after the cause of action first arose, or within a further period designated by the council in a particular case, but not afterwards.

[116]        Sun River submits its cause of action could not have arisen before December 2005 since Sun River had not suffered any damages and the CRD Board had never taken a position on the matter in dispute.  Sun River acknowledges that some CRD staff members were denying Sun River a DCC credit, but argues that the CRD Board has never resolved that a credit should not be granted.

[117]        The pleadings of Sun River make it clear that the cause of action is founded on allegations that the CRD did not exercise its statutory powers properly in relation to the application of its DCC program, particularly in regard to providing DCC credits.  The CRD’s authority in this regard is under s. 933 of the Local Government Act as discussed earlier.  From the amended statement of claim Sun River seeks a declaration “that the Development contravened section 933(8) of the Local Government Act” and “a mandatory injunction compelling the Defendant to comply with 933(8) of the Local Government Act”.

[118]        The approach to s. 285 has been set out in the leading authority, Gringmuth v. North Vancouver (District), 2002 BCCA 61, 98 B.C.L.R. (3d) 116.  Madam Justice Newbury, at para. 30, established that the key question to ask in regard to whether the limitation provision was applicable was the one posed by Mr. Justice Bauman in Pausche v. British Columbia Hydro & Power Authority, 2000 BCSC 1556, 81 B.C.L.R. (3d) 221 (S.C.).  That question is “whether, if the municipality had complied with the existing statute law when it (allegedly) caused injury to the plaintiff, it could have done that harm lawfully — i.e., in accordance with the statute”.  Sun River argues that since its claim is in equity, the limitation bar of s. 285 is not engaged.  However, in my view, consistent with Sun River’s pleading, the essence of Sun River’s claim of unjust enrichment arises out of the CRD’s actions under s. 933 of the Local Government Act.  As a result, the question is applicable and I conclude that the answer is in the affirmative.  Accordingly, the limitation period of six months is engaged. 

[119]        As to when the cause of action “first arose”, the CRD points to Mr. Young’s evidence-in-chief as well as under cross-examination that the issue of the DCC credit and the CRD’s position on DCCs first arose on January 26, 2004.  He agreed that Sun River agreed with the position set out in Mr. Smirfitt’s letter and that agreement was at the time of the letter.

[120]        The CRD also points to the following subsequent dates as alternative reference dates for the limitation period:

·                     July 13, 2004, when Mr. Hull wrote to Mr. Smirfitt advising that the provision of a $635,000 credit to Sun River was not satisfactory;

·                     March 23, 2005, when the solicitor for Sun River wrote to the CRD advising it was Sun River’s position that “no further DCCs are required to be paid by our client since the cost of the infrastructure should provide a credit greater than the amount of the DCCs which you are seeking”.

·                     December 12, 2005, when Sun River first paid water DCCs.  The payments made by Sun River were made under protest.

[121]        It is apparent from the chronology of events that the above dates triggered the running of the six-month limitation in s. 285.

[122]        I do not accept the argument that since the issue has not been dealt with by the CRD board, the limitation period has not expired.  The evidence supports the view that Mr. Hull, as the General Manager, had the authority to deny the credit, and I make this finding.  I also do not accept Mr. Young’s evidence that Mr. Hull said in December 2005 that DCCs would not have to be paid or that Sun River was entitled to a credit.  My view of the discussion, based on Mr. Hull’s and Mr. Young’s evidence, is that Mr. Hull advised Mr. Young to pay the DCCs in order for the subdivision to proceed and that Sun River’s complaint would have to be addressed later.  There was no agreement or assurance given that a refund or credit would be provided.  Sun River paid under protest.

[123]        In the result, I conclude that the action of Sun River is barred by the limitation period set out in s. 285.


[124]        The dispute in this case arises from Sun River’s timing and an error in the revisions to the CRD’s water DCC program and resultant rates.  However, I do not find these elements as factors establishing that the CRD was unjustly enriched.  Land development ventures can be highly profitable, but they come with commensurate risk.  An aspect of the risk was Sun River’s decision to proceed with the Development in advance of the PRP being included as a DCC project or without negotiating an agreement to deal with water DCCs.  No mitigating provision was negotiated regarding water DCCs.  Sun River committed in binding agreements to build the PRP, the reservoir and pump station at its expense.  In exchange, it received the requested authorizations to proceed with its development.  The case for restitutionary relief has not been made out.  Further, the six-month limitation period under s. 285 of the Local Government Act is applicable and serves as a bar to this action.  In the circumstances, a remedy at law is not available to the plaintiff.  The plaintiff’s action is dismissed.

“The Honourable Mr. Justice D. M. Masuhara”