2008 BCSC 937 D. & A. Investments Inc. v. Hawley

Before: The Honourable Mr. Justice A.F. Wilson

In Chambers

Reasons for Judgment

Counsel for the Petitioner	F.G. Reif
Advocate for the Respondents	G. Andrew
Date and Place of Hearing:	June 18 & 19, 2008
	Powell River, B.C.

I. Introduction

[1] On December 18, 2007, a dispute resolution officer determined that the Manufactured Home Tenancy Act, S.B.C. 2002, chapter 77, as amended (“the Act”) applied to the tenancies of the respondents. As it was conceded that notices of rent increase issued to each of the respondents by the petitioner did not comply with the requirements of the Act, those notices were held to be void. An application to review that decision was dismissed on February 11, 2008. The petitioner seeks an order setting aside the decision of the dispute resolution officer, and a declaration that the Act does not apply to the respondents. In the alternative, the petitioner seeks an order that the matter be remitted for reconsideration.

[2] The issue raised by the petition is whether the dispute resolution officer exceeded his jurisdiction, and thus committed an error of law in the face of the record, by deciding that the Act had application to the tenancy of the respondents. It is submitted that each of the respondents occupy recreational vehicle sites (“R.V. sites”), rather than “manufactured home sites”, and that the dispute resolution officer erred in finding that they occupied “manufactured home sites”, as defined in the Act.

II. Background

[3] The facts are not in dispute.

[4] The petitioner is the owner of the Garnet Rock Trailer and R.V. Park located near Powell River, British Columbia (“the Park”). The Park is divided into two sections, one for manufactured home tenancies, and the other for R.V. site rentals. However, some of the occupants of the R.V. sites have been there for a considerable period of time. The respondents are three of those people. Mr. Gurr began renting an R.V. site in or about 1973; Mr. Price in 1997; and Mr. Hawley in 2001.

[5] The respondents have paid rent on the first of each month, on the basis of daily rental of $7.50 per day based on a 30-day month. They thus paid $225 per month, which did not vary with the number of days within a given month. In addition, each respondent is billed for, and pays, on account of electricity use.

[6] There are no written agreements setting out the terms and conditions of the occupancy of the R.V. sites by the respondents (although other occupants, Mr. and Mrs. Ray, who commenced occupancy in 2005, signed a document entitled “Garnet Rock Mobile Home R.V. Site Long-term Daily Rental Contract”). However, Mr. Price did sign a “Garnet Rock Guest Registration & Receipt Form” showing a check-in date of May 1, 2008, agreeing to the Park Rules and conditions, and that the Park assumes no liability for personal injury, damage or loss. There are similar forms in the name of each of Mr. Hawley and Mr. Gurr, also showing a check-in date May 1, 2008, neither of which has been signed. The bottom of the forms relating to Mr. Hawley and Mr. Gurr provide basic information with respect to the operation of the R.V. Park. In addition, Mr. Gurr says that a copy of “Park Rules” was delivered to him and to every other long-term site tenant in 2007. Ms. Slinger, the manager of the Park, says that document is an addendum prepared in 2007 to the original Park Rules. She says it was prepared by a Park committee consisting of manufactured home site users, which R.V. site users are not permitted to join. She says some of the rules contained in it apply to the R.V. site users, while others do not. However, there does not appear to be any more comprehensive document setting out the rules which Ms. Slinger says do apply to the R.V. site users, such as renting space to a third party without consent.

[7] The R.V. site users do not have to pay various amounts which the manufactured home site users do pay: property taxes; insurance; garbage pickup; cablevision; the cost of installing and maintaining permanent hook ups, including frost-free water connections; and damage deposits. The manufactured home site users have to maintain their sites at their own expense, whereas the R.V. site users do not. The manufactured home site users also have to give notice when moving out, and pay up to the end of the month, whereas the R.V. site users do not have to give such notice, and pay up only to the last day they occupy the site.

[8] On or about July 25, 2007, each of the long-term R.V. site tenants were served with a notice that their “rent will be increased from $7.50 per day to $8.33 per day, i.e. $250 per month plus utilities at a current rate of $0.0633 per kilowatt hour”. The petitioner concedes that notice was not given in compliance with the provisions of the Act, in particular s.35(2), which requires three month’s notice of rent increases; s.35(3), which provides for the notice to be given in an approved form; and s.36(1), which restricts the amount of the rent increase to an amount calculated in accordance with the Regulations, unless ordered by the Director on application by the landlord, or agreed to by the tenant in writing.

[9] The respondents applied to the Director for dispute resolution pursuant to s.51 of the Act. A dispute resolution hearing was held on November 23, 2007. I accept that the petitioner did not obtain all the documentation it might have in preparation for that hearing in order to put forward its position that the Act did not apply to the long-term R.V. site tenants, relying on a decision of another dispute resolution officer dated October 10, 2007, in which that officer distinguished between the R.V. Park and the manufactured home Park. At the hearing, however, the parties presented written submissions, documents and oral submissions. They were admissible pursuant to s.68 of the Act.

[10] The dispute resolution officer issued a written decision and reasons dated December 18, 2007. Although there were issues as to whether the fifth-wheel trailers occupied by Mr. Gurr and Mr. Price were “manufactured homes”, the main issue considered by the dispute resolution officer was whether the Act applied to tenancies in the R.V. Park. He noted that, pursuant to s.2(1) of the Act, it applies to “tenancy agreements, manufactured home sites and manufactured home Parks”. He then considered the definitions in the Act of “manufactured home”, “manufactured home Park”, “manufactured home site”, “tenancy”, and “tenancy agreement”. He then referred to Policy Guideline Number 9, a publication of the Residential Tenancy Branch. In its head paragraph, it states:

This Policy Guideline is intended to provide a statement of the policy intent of legislation, and has been developed in the context of the common law and the rules of statutory interpretation, where appropriate. . .

[11] The dispute resolution officer quoted the part of Policy Guideline Number 9 setting out factors relied upon to distinguish “tenancy agreements” from “licences to occupy”, which are said not to be covered by the Act. He noted that the Policy Guidelines suggested. “. . .that there is a distinction to be drawn from a mobile home intended for recreational use and one that is purpose built as a manufactured home”. He noted that the fifth wheel trailers owned by Mr. Gurr and Mr. Price were intended for recreational use. However, he concluded “. . . that the actual use to which a structure is put is one of the factors that determines whether a structure falls within the definition of “manufactured home”, irrespective of its intended use”. In this case he found that each of the respondents used their respective structures as living accommodations, and as their principal residences. He thus determined that they fell within the definition of “manufactured home” under the Act. He also held that the manufactured home in which Mr. Hawley resides meets the definition in the Act. He thus determined that the Act was applicable to their tenancies, and the rent increases were void. He did not specifically comment on the evidence that the R.V. site users do not have to pay property taxes, insurance, cablevision, garbage pickup or damage deposits; that they have temporary hook ups and do not need to install permanent frost free water connections; they do not have to maintain their sites; and that they do not have to give notice when vacating the site and pay rent only up until they do vacate, some of which are factors said to weigh against finding a tenancy in Policy Guideline Number 9.

[12] The petitioner did apply to the Director for a review of the decision, based on further documentary evidence obtained after the date of the hearing. That application was filed within 15 days of receipt of the decision, but the filing fee was not paid until 3 days after the end of the 15 days provided for review under s.71 of the Act. In addition, the reviewing officer found that the evidence submitted with the application for review was neither new nor unavailable at the time of the hearing. The application for review was thus dismissed, by reasons dated February 11, 2008.

III. Law

[13] Pursuant to s.71.1 of the Act, the provisions of the Administrative Tribunals Act, S.B.C. 2004 Chapter 45 apply to dispute resolution proceedings under the Act. The Act does contain a privative clause, in s.77.1. Section 58 of the Administrative Tribunals Act thus applies. It provides as follows:

58(1) If the tribunal’s enabling Act contains a privative clause, relative to the courts the tribunal must be considered to be an expert tribunal in relation to all matters over which it has exclusive jurisdiction.

(2) In a judicial review proceeding relating to expert tribunals under subsection (1)

(a) a finding of fact or law or an exercise of discretion by the tribunal in respect of a matter over which it has exclusive jurisdiction under a privative clause must not be interfered with unless it is patently unreasonable,

(b) questions about the application of common law rules of natural justice and procedural fairness must be decided having regard to whether, in all of the circumstances, the tribunal acted fairly, and

(c) for all matters other than those identified in paragraphs (a) and (b), the standard of review to be applied to the tribunal’s decision is correctness.

(3) For the purposes of subsection (2)(a), a discretionary decision is patently unreasonable if the discretion

(a) is exercised arbitrarily or in bad faith,

(b) is exercised for an improper purpose,

(d) fails to take statutory requirements into account.

[14] Counsel for the petitioner submits that this is not “a finding of fact or law or exercise of discretion by the tribunal in respect of a matter over which it has exclusive jurisdiction. . .” (with respect to which the standard of review pursuant to s.58(2)(a) is “patent unreasonableness”), but rather is a matter of interpretation of the statute, going to the jurisdiction of the tribunal, so that the standard of review is correctness, pursuant to s.58(2)(c). In the alternative, if it was a discretionary decision, he submits that it was patently unreasonable as it “fails to take statutory requirements into account”: s.(58)(3)(d).

[15] The recent decision of the Supreme Court of Canada in Dunsmuir v. New Brunswick, 2008 SCC 9, dealt with standards of review in a common-law context. The court determined that there are only two standards: correctness and reasonableness. However, the standard of review set out in the Administrative Tribunals Act is a statutory one, rather than one at common law, so that, for the purpose of review under that Act, the standard of patent unreasonableness still applies.

[16] As to whether a matter is a question of jurisdiction, or one of exercise of discretion, the court in Dunsmuir, at paragraph 59 said:

[59] Administrative bodies must also be correct in their determinations of true questions of jurisdiction or vires. . . . ”Jurisdiction” is intended in the narrow sense of whether or not the tribunal had the authority to make the inquiry. In other words, true jurisdiction questions arise where the tribunal must explicitly determine whether its statutory grant of power gives it the authority to decide a particular matter. The tribunal must interpret the grant of authority correctly or its action will be found to be ultra vires or to constitute a wrongful decline of jurisdiction.

D.J.M. Brown and J.M. Evans, Judicial Review of Administrative Action in Canada at pages 14-3 to 14-6 . . .

We reiterate the caution of Dickson J. in C.U.P.E. [C.U.P.E. v. Ontario (Minister of Labour), [2003] 1 S.C.R. 539] that reviewing judges must not brand as jurisdictional issues that are doubtfully so.

[17] Counsel for the petitioners has provided a number of cases dealing with the issue of whether determinations of administrative tribunals are “true questions of jurisdiction”, to use the term adopted in Dunsmuir, paragraph 59.

[18] In a case decided since Dunsmuir, Howe v. 3770010 Canada Inc., 2008 BCSC 330, Gerow J. considered the standard of review of the decision of an arbitrator under the Act. Five tenants who owned manufactured homes in a Park applied to set aside notices of intent to end their tenancies. She concluded, at paragraph 9, that the appropriate standard of review was reasonableness. However, the issue before her was whether s.42(1) of the Act, that all necessary permits and approvals required by law to convert the manufactured home Park to other use were required before the notice was given, was applicable. There was no issue that the petitioners were covered by the Act, nor any question of the jurisdiction of the arbitrator to make the order made. It is thus unlike the present case, in which it is submitted that the issue does go to the jurisdiction of the dispute resolution officer to make the order made.

[19] In Caesar et al. v. Sherwood et al., 2000 BCSC 1053, Hunter J. dealt with an issue of whether an arbitrator had jurisdiction to consider a notice of rent increase pursuant to a provision of the Residential Tenancy Act, R.S.B.C. 1996, chapter 406. At paragraph 9, he stated:

. . . If the question is whether the arbitrator lacked jurisdiction to make the order then correctness is the applicable standard of review. If the arbitrator had jurisdiction to determine the matter under s.72 then one must apply a standard of patent unreasonableness in reviewing his decision.

[20] After referring to Syndicat des employés de production du Québec et de l’Acadie v. Canada (Labour Relations Board), [1984] 2 S.C.R. 412, he continued, at paragraph 11:

[11] In other words, if an arbitrator’s decision pertains to whether or not he has jurisdiction under the Act then the standard of review is correctness, that is, the arbitrator’s interpretation of the scope of his power has to be correct. On the other hand, if an arbitrator is applying a provision within the scope of his jurisdiction then the standard of review is whether that decision was patently unreasonable (See also: Cameron v. Sparks (1997), 35 B.C.L.R. 93d) 391 (B.C.S.C.). As Well CAIMAW, Local 14 v. Paccar Canada Ltd. [1990] 62 D.L.R. (4^th) 437 (S.C.C.), quoted in Mack v. Yu (1991), 7 Admin. L.R. (2d) 67 (B.C.S.C.) at p. 78:

Where, as here, an administrative tribunal is protected by a privative clause, this court has indicated that it will only review the decision of the board if that board has either made an error in interpreting the provisions conferring jurisdiction on it, or has exceeded its jurisdiction by making a patently unreasonable error of law in the performance of its function: see C.U.P.E., Local 963 v. N.B. Liquor Corp. (1979), 97 D.L.R. (3d) 417, [1979] 2 S.C.R. 227, 25 N.B.R. (2d) 237. . . .

(my emphasis)

[21] In that case, Hunter J. determined that the arbitrator had jurisdiction to make the order he did make and that the standard of review was patent unreasonableness.

[22] In Fulber v. Doll, 2001 BCSC 891, tenants petitioned for judicial review of the decision of an arbitrator that the landlord could evict tenants who were charged with growing marijuana on the rented premises. L. Smith J. held that the decision was within the arbitrator’s jurisdiction, and the standard of review was thus patent unreasonableness. In determing that, she stated, at paragraph 63:

[63] Applying the four factors the Supreme Court has identified in Baker and Pushpanathan, I note the following. First, there is a “finality” clause, though not a “full” privative clause. Section 57(3) of the Act states that “Except as otherwise provided in this Act, a decision or order of an arbitrator is final and binding on the parties”. Second, given the arbitrators’ task under the legislation to determine large numbers of disputes between landlords and tenants, it seems likely that arbitrators have expertise in determining when a landlord’s safety or other lawful right or interest has been seriously impaired by an act or omission of the tenant. Third, the purpose of the arbitration scheme in the Act must be to provide for dispute resolution between landlords and tenants inexpensively and expeditiously. Consistent with this would be a deferential approach when the arbitrators are determining questions of law or mixed fact and law within their jurisdiction. The question here, that is, whether the “safety or other lawful right or interest of the landlord” has been “seriously impaired by an act or omission of the tenant”, is a question of mixed fact and law. Fourth, the decision affects the interests of the particular tenants and landlord, and is not complex, polycentric, or policy-intensive. This latter factor points toward less rather than more deference. However, considering the legislative scheme and nature of the decision at issue here, as well as the previously-decided cases on the standard of review under the Act, I conclude that the standard of review should be patent unreasonableness.

[23] Similarly, in L.H. Woolman & Associates Ltd. v. Robert Blad et al., 2001 BCSC 1525, Williamson J. determined that the standard of review of the decision of an arbitrator with respect to notices of rent review was patent unreasonableness. However, there was no issue that the arbitrator had the jurisdiction to make the decision that he did, only that he erred in not making reference to portions of the Regulation which set out the procedure for determining rent increases.

[24] A case more comparable to this one is the decision of the British Columbia Court of Appeal in Schubach v. B.C. Housing Management Commission, 2003 BCCA 619. That case involved whether the term “residential property” or “residential premises”, as defined in s.1 of the Residential Tenancy Act meant one building or included a complex or a group of buildings. The chambers judge concluded the terms referred only to a single building, and that the arbitrator thus acted without jurisdiction in determining that the Act applied to the group of buildings and refusing to set aside the notice to end the tenancy.

[25] In paragraph 19, Levine J.A., for the court, referred to the statement of the approach to determine the appropriate standard of review set out by L. Smith J. in paragraph 63 of Fulber v. Doll, supra. She then continued, in paragraphs 20 to 22, as follows:

[20] In paragraph 62 of her reasons, Smith J. referred to previous decisions in which courts in British Columbia have held that arbitrators are entitled to curial deference with respect to intra-jurisdictional questions of law: see Fraser v. Vancouver Board of Parks and Recreation, [2001] B.C.J. No.1086, 2001 BCCA 214 (C.A.) (QL), where Saunders J.A. for this Court held that the patent unreasonableness standard should be applied to an arbitrator’s decision characterizing the relationship between a resident caretaker and the Parks Board as one of “employment”.

[21] In this case, the question reviewed by the chambers judge was the arbitrator’s assumption that she had jurisdiction to decide whether s.36(1)(f) applied on the facts of this case. The underlying question of interpretation, the meaning of “residential property” and “residential premises”, is an intra-jurisdictional question of law.

[22] I agree with Madam Justice Smith’s analysis and conclusion that a high degree of deference is appropriate in reviewing a decision of an arbitrator under the Act. While the question in this case is one of law, not one of mixed fact and law, suggesting that less deference is appropriate, the other factors, and the previous cases, lead me to agree with the parties that the standard of review is patent unreasonableness.

[26] I consider that statement by Levine J.A. in paragraph 22, that even questions of law interpreting the statute to determine if the Act is applicable is an “intra-jurisdictional question of law”, to which the standard of patent unreasonableness applies, to be binding on me in this case. I thus find that the standard of review in this case is that of patent unreasonableness, pursuant to s.58(2)(a) of the Administrative Tribunals Act, not correctness, pursuant to s.58(2)(e).

IV. Was the decision of the dispute resolution officer patently unreasonable?

[27] Counsel for the petitioner submits, in the alternative to the submission that the decision of the dispute resolution office was outside his jurisdiction, that the decision is patently unreasonable. Specifically, he submits that the dispute resolution officer erred in ignoring provisions in the Guideline issued by the Ministry to determine whether there is a tenancy, and thus did not properly exercise his discretion.

[28] As noted in paragraph 10, the dispute resolution officer did refer to the Guideline, quoting the section relating to factors which “would tend to support a finding that the arrangement is a licence to occupy and not a tenancy agreement”. He did not specifically consider evidence put forward on behalf of the petitioner, considered in the Guideline as factors which would tend to support a finding that the arrangement was a licence to occupy and not a tenancy agreement. Specifically, those are that payment or a security deposit is not required; that the owner retains access to, or control over, portions of the site; that the owner retains the right to enter the site without notice; and that the occupier may vacate without notice. The petitioner notes other factors indicating that there was not the type of tenancy there is with the manufactured home park residents: that the units in question were in the area designated as R.V. park, not the area designated as the manufactured home park; that rent was calculated on a daily basis; that the property owner pays the utilities such as cablevision and garbage pickup (although occupants do pay for their own electricity consumption); that occupants do not have to pay the cost of installing and maintaining permanent hook-ups, including frost free water connections; that there are no written tenancy agreements; that occupants do not have to maintain their own sites; and that they only have to pay up to the last day they occupy the site, rather than to the end of the month.

[29] This situation is somewhat analogous to that in L.H. Woolman, supra, in which the ground relied on was that the arbitrator did not perform some of the calculations set out in the Regulations. In this case, the dispute resolution officer did not specifically consider all of the factors set out in the Guideline weighing for and against a tenancy agreement. However, he did conclude that because the tenants were “. . . long-term, year round tenants, pay rent monthly, have access to services and pay utilities monthly . . .” that the Act applied and that the landlord was required to comply with the Act and the Regulations. I cannot say that is patently unreasonable. If one looks at the policy behind the Act, to provide protection to both landlords and tenants who are involved in long-term tenancies, it is reasonable that the Act should apply to the respondents. That is so even if it may result in the petitioner having to make some significant changes in the property occupied on a long-term basis in the R.V. park.

[30] I conclude that the decision of the dispute resolution was not patently unreasonable. The application for an order setting aside the decision dated December 18, 2007, and a declaration that the Act does not apply to the respondents, is thus dismissed.

V. Decision Dated February 11, 2008

[31] It is also submitted, on behalf of the petitioner, that the dispute resolution officer improperly exercised his statutory power by denying leave to review the decision of December 18, 2007.

[32] There is no issue that decision falls within the dispute resolution officers, so the question is whether it was patently unreasonable.

[33] There was an issue as to whether the application was filed late. The application itself was filed on the last day for filing, but the fee payable was not paid until three days later. However, the decision did not turn on that basis. The dispute resolution officer noted that the applicant relied on s.72(2)(b) of the Act, which provides that the Director may grant leave for review if a party has new and relevant evidence that was not available at the time of the original hearing. He reviewed the evidence provided, and noted that it was “. . . neither new nor unavailable at the time of the hearing. . .”. That is not disputed. Even though the petitioner did not produce all of that evidence at the initial hearing on the assumption that the matter had been determined in a previous hearing, that does not provide a basis to reverse the decision.

[34] I thus find that the decision dated February 11, 2008, was not patently unreasonable. The application for an order setting aside that decision is thus dismissed.

VI. Costs

[35] This decision does deal with all issues raised in the petition. As the respondents have been successful, they will be entitled to their costs of the proceeding.

_______________________________

A.F. Wilson, J.

Citation:	*D. & A. Investments Inc. v. Hawley,*
	2008 BCSC 937