CPR versus City of Vancouver, 2006

Many interesting questions have been raised recently regarding why a City of Vancouver by-law restricting the use of land belonging to Canadian Pacific Railway (CPR) was upheld by the courts in BC (CPR v City of Vancouver 2006) notwithstanding the fact that CPR was in possession of its own Land Patent Grants.

In recent years, CPR shut down lines and removed the rails from much of the property it owned and has. in some cases, sought to develop the land for other purposes, thereby generating new revenue for the company. The City of Vancouver, however, passed a By-Law prohibiting any such development by CPR on its property by designating the land “public use”.

It is suggested that this is an example of the court upholding the right of a municipal government to restrict land usage rights pursuant to a Land Patent Grant. This is a mistake.

The Railway Act (1879), as well as the actual Letters Patent issued when CPR was incorporated spelled out what the company could do with the property it acquired. Specifically, CPR was restricted to using the land for railway beds, stations and station grounds, workshops for the railway and rail yards. The restrictions embodied in the City of Vancouver By-Law were entirely consistent with these limitations. What’s more, the By-Law does not prevent CPR from using the land to store or maintain railway supplies and equipment.

A second reason why CPR v City of Vancouver is not an example of the government successfully circumventing land usage rights rests in the manner in which CPR acquired its land grants. Because the land was either already owned by the crown, or acquired by it prior to being granted to CPR, and since the conditions under which the grants were being issued were clearly spelled out in legislation and the Letters Patent of CPR at its incorporation, the Crown retains a residual right to determine the use of the property if those conditions are not being fulfilled.