A B.C. Supreme Court Justice has found in favour of the owner of a gravel quarry in the latest turn in a long-running dispute with the City of Prince George over its decision to impose a stop work order on the operation.
At issue was whether a settlement agreement reached between the city and Rolling Mix Concrete Ltd. and Rock'n’ Roll Aggregate Ltd., covered additional damages the businesses are now seeking in the aftermath.
In a decision issued August 3, Justice Marguerite Church found that an "objective bystander" would agree with the businesses' position.
In April 2019, the city enacted a new soil removal bylaw that limited the activity to no closer than 100 metres of any land zoned for residential or institutional use and, in October 2020, the city ordered the businesses to cease work within the setback.
The order took away access to about a third of the sand and gravel reserves at the site.
While the businesses complied, they took the matter to court. In a notice of claim filed in February 2021, their lawyer, Roy Stewart, contended a permit issued by the provincial government under the B.C. Mines Act that allowed a five-metre setback took precedence and, if it did not, the operation remained a "legal non-conforming use" because it predated the new bylaw.
In a subsequent letter to the city, Stewart indicated his clients would be seeking damages of about $6 million based on compensation equal to sand and gravel foregone due to the difference in setbacks between the city's bylaw and the mining permit granted by the province.
Talk of reaching an out-of-court settlement followed and, in October 2021, a draft consent order that includes a 30-metre setback from adjacent residential property and waiving the claim for $6 million was drafted. Following further negotiations regarding the wording, Stewart approved a draft order and, in early December 2021, the city issued a press release saying an agreement had been reached.
But three days later, the businesses filed an amended notice of claim seeking separate damages related to site clearing and the cost of securing material from a different and more costly source. According to an affidavit from the businesses' president, John Paolucci, filed in the months that followed, the losses worked out to more than $500,000 and were climbing.
In a response, the city filed an application to dismiss the amendment and asserted Stewart's clients had acted in "bad faith." But Church found otherwise. In doing so, Church emphasized Stewart's wording in reply to a clarification from counsel for the city. In it, he said the settlement applied to all claims for damages "expressed in that action."
The city contended the position was unreasonable because the discussions between counsel had "clearly contemplated the broader scope of damages in the legal action.
"With all due respect, I cannot accept that submission," Church said in the decision and went on to say an "objective bystander" reading Stewart's clarification would understand that his client is giving up damages originally expressed "and nothing else."
In dismissing the city's application to reject the businesses' claim, Church said they are entitled to costs for legal expenses from the City as the "substantially successful party."
"The City is reviewing the court’s decision and will discuss options with our legal counsel," spokesperson Julie Rogers said in response to a request for comment. "No further comments will be made at this time."
