HOLDING LAND IN TRUST: UNSHACKLING FINANCIAL CONSTRAINTS

LOCAL GOVERNMENTS SOMETIMES OWN LAND IN “TRUST”, PERHAPS MOST COMMONLY WHERE A PERSON, LIVING OR DECEASED, DONATES LAND AS PARK. LEGALLY, SUCH A “CHARITABLE PURPOSE TRUST” IS FOR THE PUBLIC BENEFIT AND ENFORCEABLE BY THE B.C. ATTORNEY GENERAL, AND THE TRUST CONDITION WILL PREVENT A LOCAL GOVERNMENT FROM SELLING OR CHANGING THE USE OF THE PROPERTY.

While “free” land is attractive, what can a local government do if trust property proves unsuitable for the intended purpose, or if there are insufficient funds to improve the property for that purpose? Go to court, of course! Section 184 of the Community Charter permits a municipality to apply to court to vary a trust “If, in the opinion of a council, the terms or trusts … are no longer in the best interests of the municipality” (see also section 282 of the Local Government Act). Two recent B.C. Supreme Court decisions illustrate.

In West Vancouver (District) v. British Columbia (Attorney General), (2020), Clara Brissenden had died in 1990, leaving a will that bequeathed a property to the District in trust as a park. The District left the park undeveloped for years, and in 2018 council adopted a plan to sell part of the property and use the proceeds to purchase other property to be added to Ambleside Park. The District applied to court under section 184. The court held that while the plan to sell some of the property was inconsistent with Ms. Brissenden’s intention that the property be used as park, section 184 of the Community Charter provides flexibility to vary trusts where a municipality is trustee:

[s.184(3)] clearly shows an intention on the part of the legislature to alter the common law as it relates to the variation of trusts held by municipalities. While the reference to the “the intention of the [settlor]” reflects a core consideration in the law of charitable trusts, the direction to the court to consider “the best interests of the municipality” in conjunction with the settlor’s intention clearly derogates from the established common law.

The court approved the District’s plan, finding that Ms. Brissenden’s wishes included the development of park space generally and that the plan was in the best interest of the District and its residents.

In Comox (Town) v. British Columbia (Attorney General), (2023), the naturalist Mack Laing transferred a property (including his home) to the Town in trust for recreation and conservation purposes. He transferred the property in 1973, and when he died in 1983, his will bequeathed $48,000 to the Town in trust to improve and operate his former home as a natural history museum. The Town eventually determined that the funds were insufficient to convert the home to a museum and planned to demolish the home and use the trust monies to replace it with a nature viewing platform. The Town applied to court under section 184 to proceed with this plan. The court approved, concluding that the trust funds were never sufficient to convert the home into a museum and that the Town’s proposal would achieve Mr. Laing’s wishes.

As these cases show, section 184 can be used to remove the shackles that arise from accepting land in trust for park or other purposes, permitting a court to consider local government plans for the trust property in light of local government’s assessment of its own best interest.

MIKE QUATTROCCHI joined Young, Anderson in 1998 after practicing as an associate at a large Vancouver law firm. Mike holds a B.A. in Economics from Queen’s University, a Masters in Economics from the University of Toronto, and a law degree from UBC. He was called to the bar in 1997. Mike advises local government clients on a wide range of matters, with particular focus on corporate and commercial transactions, land use regulation, real estate development, project tendering and construction and environmental issues. He has assisted with all aspects of large land acquisition and construction projects, including in relation to parks, courthouses, fire halls, recreation facilities, seniors’ facilities and government offices. Mike’s practice also includes advising with respect to bylaw preparation, land expropriation, elections and public approval processes, the establishment of local government corporations and general local government issues. Mike is also the past Chair of the Municipal Law Section of the Canadian Bar Association BC Branch.