Ackroyd LLP successful on behalf of Eastern Irrigation District in judicial review application involving interpretation of the Alberta Irrigation Districts Act
On October 18, 2019, Madam Justice Johnna C. Kubik of the Alberta Court of Queen’s Bench granted the Eastern Irrigation District (“EID”) its application for Judicial Review and quashed the decision of the Irrigation Council Appeal Panel (“ICAP”) which had earlier rescinded 3 decisions of the EID refusing to grant the application of the respondents George Murray V, Kimberley Resch and Kirk Dustin Prescott to add irrigation acres to the assessment roll pursuant to the provisions of the Irrigation Districts Act (“IDA”) of Alberta. Our Bill McElhanney and Alex Yiu successfully argued the judicial review application before Madam Justice Kubik in Medicine Hat over a period of two days in April of this year.
A full copy of the decision can be found here.
The decision of Madam Justice Kubik has significant precedential value in the area of irrigation law in Alberta in that for the first time, a superior court in the Province of Alberta has judicially considered section 96(1) of the Irrigation Districts Act in respect of the term “owner”, including the legal question of whether or not it was reasonable for the EID to have considered acts of dishonesty and deceit in determining whether a particular applicant “owner” was bona fides – in this case Murray V, Resch and Prescott – or not at the time of their application to the EID to add irrigation acres to the assessment roll.
On April 3, 2018 the (“ICAP”) quashed an earlier decision of the EID denying three applications for allocation of new irrigation acres. Two applications for judicial review arose from that decision.
The EID sought judicial review of the ICAP decision. In relation to this application, the Alberta Irrigation Districts Association (hereinafter referred to as the “AIDA”) was granted intervenor status.
A second application for judicial review was brought by Resch, Prescott, Murray V. They sought an order of mandamus requiring the EID to add the requested irrigation acres to their respective assessment rolls.
In granting the EID judicial review, Madam Justice Kubik reviewed the intent and objectives of the IDA – in particular, she observed that beneficial ownership could be examined by the EID in discharging its statutory function under the IDA, and further the very concept of ownership must be interpreted in conjunction with the Land Titles Act in order to give meaning to legislative intent. She elaborated thusly at paragraphs 59 and 60:
 Taken as a whole, the legislation, By-Law 840, and the Policy developed by the EID with respect to the expansion and allocation of these acres, was focused on fairness in the allocation of new acres – supporting as many diverse users as possible, while practicing sustainable resource management. Given that the EID was tasked under section 96 with reviewing the applications of “owners” (or purchasers with the consent of the registered owners), the element of fairness in the purpose of the legislation and the EID’s accountability to users and the public gives the EID the scope and power to ensure the legitimacy of owners applying for new irrigation acres, and therefore to examine ownership, including beneficial ownership.
 Given the purpose of the Irrigation Districts Act, and the expectation of irrigators in the institution of By-Law 840 which deals with sustainable resource management, equitable distribution of irrigation acres and promotion of the economic viability of the EID, the very concept of ownership must be interpreted in conjunction with the Land Titles Act in order to give meaning to legislative intent.
In assessing the specific evidence comprising the record before her, Justice Kubik observed, among other things, that there was prima facie evidence before the EID and ICAP of suspicious transactions which could be characterized as deceit and dishonesty on the part of the respondents Resch, Prescott and Murray V. Her Ladyship elaborated thusly at paras 64 to 66:
 There was prima facie evidence before the EID and the ICAP of suspicious transactions which could be characterized as deceit and dishonesty on the part of Resch, Prescott, and Murray V. At the judicial review hearing before me, counsel for these parties argued that a nominal transfer based on one dollar, or love and affection, would not be uncommon in an intergenerational farming operation. However, there was no evidence before the EID or the ICAP that this was such a transfer. The land owners offered no explanation as to their interrelationship, the intention of their nominal consideration transfers of land valued in excess of hundreds of thousands of dollars, and the fact that the transferees Resch and Prescott took title to land which was subject to nearly one-million dollars in undischarged mortgage indebtedness.
 In the face of this evidence, it was unreasonable for the ICAP to determine that section 62 of the Land Titles Act was irrelevant to the EID’s analysis of ownership of the land. The term “owner” included “registered owner” as defined in accordance with registration at land titles. In tendering the Certificates of Title, Resch, Prescott, and Murray V expressly relied on section 62 of the Land Titles Act. That put the issues of fraud and collusion squarely before the ICAP and EID.
 The ICAP’s conclusion that the concepts of fraud or bona fides were not incorporated into the Irrigation Districts Act, and therefore the legislature did not intend to empower the EID to consider such concepts, ignores the purpose of the legislation and the expectation of users, as reflected in By-Law 840, that irrigation acres would be allocated fairly in a manner which spread the benefit of irrigation amongst diverse farming operations, supported the crop spectrum in the District, and provided a strong economic base for the District and community. It was not reasonable, in light of the purpose of the legislation, for ICAP to apply a strict statutory interpretation, which excluded an examination of the bona fides of the land titles. It was reasonable for the EID when faced with evidence of fraud, deceit, or dishonesty in relation to ownership of the land, to investigate the bona fides of ownership so as to meet its statutory mandate.
In addition, Justice Kubik commented at paragraph 71 that the ICAP’s interpretation could lead to sham land transactions for the purpose of obtaining more acres than allowed by By-Law 840, or lead to electoral manipulation affecting the composition and control of irrigation district boards, and that this “…not a consequence reasonably intended by the legislature, particularly given the purpose and intent of the legislation in relation to equity, sustainability, economic viability and accountability to users. To this end, the ICAP erred in failing to consider the consequences of strict statutory interpretation.”
Justice Kubik concluded based on the facts and law before her that she was satisfied that the decision of the ICAP with respect to the Resch, Prescott, and Murray V applications was unreasonable in that it did not fall within a range of possible acceptable outcomes defensible in respect of the facts and law, including principles of statutory interpretation and procedural fairness. She further was satisfied that the Irrigation Districts Act empowers individual irrigation districts to investigate the legitimacy of title when considering whether to allocate new irrigation acres.
Justice Kubik found that the original decisions of the EID were therefore reasonable having regard to the scope, purpose, and intention of the legislation and the facts before it.
The ICAP decision was accordingly quashed and the EID decisions were restored.
As no appeal has been taken from the decision of Madam Justice Kubik, it is now the law of the Province of Alberta that the Irrigation Districts Act empowers each of the 13 irrigation districts across the Province to investigate the legitimacy of title – including examining who the beneficial owner is behind the subject title – when considering whether to allocate new irrigation acres.