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Provincial Court of Appeal rules Three Sisters Village, Smith Creek area structure plans to proceed

Two area structure plans, that could see up to 7,150 residences built in Canmore, can go ahead after a Court of Appeal rejected the Town of Canmore's arguments against the plans.
Stewart Creek in Three Sisters Mountain Village in 2022. RMO FILE PHOTO

CANMORE – The Three Sisters Mountain Village Properties Limited Smith Creek and Three Sisters Village area structure plans will proceed, per an Alberta Court of Appeal ruling.

The court decision all but concludes the long-running legal battle between TSMVPL and the Town of Canmore, which has been ongoing for roughly two-and-a-half years since council rejected both ASPs in 2021.

It also seals the fate of development on lands previously approved in the 1992 Natural Resources Conservation Board (NRCB) decision that has lingered for more than three decades.

“The Town has not established a basis upon which we can interfere with the tribunal’s decisions,” the Court of Appeal decision states. “The appeals are dismissed.”

The two ASPs will move forward as presented at first reading in February 2021.

While the decision ruled entirely in favour of TSMVPL, the court acknowledged that “there are strongly held and divergent views about what development should or should not occur.” However, they emphasized the court’s role is to answer “certain questions of law and jurisdiction.”

“We appreciate the court's due diligence in making this decision and look forward to moving ahead in the coming weeks and months to help enhance the Canmore experience through Three Sisters Mountain Village,” said David Taylor, president of TSMVPL. “We’re excited to continue working to develop world-class, livable communities in the heart of Alberta’s Rocky Mountains.”

The Court of Appeal heard from both sides April 3, including intervenors from the Stoney Nakoda First Nation, the Land and Property Rights Tribunal (LPRT) and the NRCB.

The basis for the Town’s arguments was on nine grounds, with the main aspect being the LPRT failed to properly apply Section 619 of the Municipal Government Act retrospectively, the LPRT failed to give adequate reasons for the ASPs moving forward and the ASPs not being consistent with the 1992 NRCB decision.

The court noted the LPRT's reasons in its decisions were brief, but that they were “not persuaded” in Section 619 having a retrospective effect as well as the LPRT’s interpretation of Section 619 was consistent with the law.

“We cannot disturb the tribunal’s determination that the NRCB approval is continuing, and the reasonableness standard of review prevents this court from interfering with the tribunal’s interpretation of the law in question,” the appeal court’s decision stated.

“Beyond arguing the tribunal lacked jurisdiction to hear the respondent’s appeal under Section 619 of the MGA, the Town resisted a finding of consistency by emphasizing that the NRCB preserved municipal discretion to ‘refuse the project’. … the tribunal did not accept the Town’s assertion that it had the authority to completely reject the project even if it complied with the NRCB Approval. Neither do we.”

The appeal court noted TSMVPL argued the LPRT’s “decision is based on an internally coherent and rational analysis and is justified in relation to the facts and law.”

“The tribunal reasonably declined the invitation to revisit the NRCB public interest determination,” according to the appeal court’s decision. “That is not something the tribunal has jurisdiction to do. It is also important to remember that the NRCB approval was expected to govern for several decades.”

“The Town’s position therefore came down to an argument that the ASPs were simply too different from what was considered and approved by the NRCB to be considered consistent with the NRCB approval. The tribunal disagreed, with reasons that adequately explain its reasoning process when they are read in the context of the proceedings. The tribunal considered the evidence and argument it heard and addresses all the consistency issues raised by the Town in an intelligible and transparent way.”

The Court of Appeal ruling agreed with TSMVPL’s statement and that it could not “interfere with the tribunal’s characterization of the NRCB approval as a continuing fact or its interpretation of Section 619 as providing for ‘paramountcy of provincial approvals that are in place at the time of a municipal action.’”

From the 1992 NRCB decision not having an expiry date, the coordination of the NRCB and planning processes in Section 7 of the decision, the addition of Section 619 to the MGA, where municipal jurisdiction begins and ends, the level of consistency of planning needed to meet the NRCB decision and whether the LPRT had the jurisdiction to rule on such a matter, the prolonged and complex legal case has continued to gather layer upon layer.

But with the Oct. 3 decision, the Court of Appeal provided a decisive answer in what would move forward on the TSMVPL-owned lands.

“The Town’s argument that the tribunal took into consideration irrelevant evidence in concluding the ASPs were consistent with the NRCB approval is without merit,” stated the appeal court’s decision.

“The tribunal had the benefit of a considerable body of evidence – including expert evidence – addressing the question of consistency between the NRCB approval and the Three Sisters ASP as submitted and considered by council on Feb. 9, 2021.”

Yellowstone to Yukon Conservation Initiative (Y2Y), who were intervenors at the LPRT hearings, said in a statement "this news is the latest blow in a series of decisions and failures that preceded today’s update. These developments will be front and center in a critical link in the chain of mountains that stretch from Yellowstone National Park to Yukon in the north.

"Keeping this connection strong is a key part of maintaining the values that make Canmore and the Bow Valley special, both ecologically and as a tourism destination. The area structure plans as presented threaten the integrity of this corridor and the wildlife habitat nearby."

The 2018 terms of reference approved by Canmore council outlined the work that would take place between TSMVPL and the Town for the development of the lands. The terms of reference also added the Thunderstone lands to the overall plan in Smith Creek ASP.

The court reviewed the arguments to see if the LPRT decisions were either reasonable or unreasonable in reaching a conclusion. The Town’s legal representation ultimately had to show the LPRT decisions were unreasonable and acted outside its legislative powers.

During the appeal hearing, Justices Frans Slatter, Anne Kirker and Beth Hughes raised issues with the Town’s argument surrounding the ASPs consistency and the NRCB decision, Section 619 of the MGA, the 2018 terms of reference and if arguing the passage of time was a collateral attack on the NRCB.

“The NRCB approval could have been, but was not, time limited. … No one appealed it,” the appeal court decision stated.

The court decision emphasized that in the 2018 terms of reference, the Town had not said the NRCB approval was no longer relevant.

The appeal court noted the Town had “resiling” – meaning it backed away from a previous agreement – from the terms of reference in its arguments to the Court of Appeal.

“Neither Town council nor Town administration suggested the NRCB approval was no longer valid. On the contrary, the terms of reference made clear that the parties were proceeding on the basis that pursuant to Section 619 of the MGA, the Town would be obligated to approve the Smith Creek and Three Sisters ASPs if they were consistent with the NRCB approval.”

In a rare admittance, the Town’s legal representative noted she hadn’t convinced the three justices of all the Town’s arguments to refute the LPRT decisions at the April 3 Court of Appeal hearing.

As of June 20, 2023, the Town’s litigation costs for TSMVPL-related cases was $591,000.

But while the Court of Appeal and LPRT ruled the ASPs would move forward, they did so without the nearly two dozen amendments made to the Three Sisters Village ASP by the previous council during second reading since the plan was rejected by council.

The amendments focused on the phasing of commercial and residential, affordable housing and Indigenous relations.

Court of Appeal decision – Three Sisters Mountain Village Properties Limited and Town of Canmore – Oct. 3,... by Greg on Scribd

A May 14, 2021 meeting between Town staff and representatives for TSMVPL looked at 11 specific amendments, largely around phasing and housing.

In a Town summary of the meeting, received by the Outlook via a Freedom of Information and Protection of Privacy request, it was emphasized by TSMVPL that any amendments “shall be fully compliant with the Municipal Government Act.”

The other council amendments attempted to have commercial development finished before residential builds, reducing the Three Sisters Village ASP residential unit counts and density projections by about 33 per cent and for a minimum of 20 per cent of housing to be affordable.

According to the Town summary of the meeting, the two sides were unable to agree on reducing unit counts and population density as well as affordable housing percentages, which isn’t required in the MGA, and the bonus structure outlined in the ASP.

Last January, the Town and TSMVPL agreed to a pause on the mandamus application, which had TSMVPL asking the Court of King’s Bench to direct the Town to implement the LPRT’s decisions on the ASPs.

Part of the agreement had the Town agreeing to abandon any future appeals, though the Supreme Court of Canada was the last remaining option. In reaching the agreement, the Town agreed to uphold the LPRT’s decisions and TSMVPL paused its mandamus application.

The Town could have applied for a stay in the LPRT’s decisions, but it would have had to handle a monthly financial burden determined by the court. Without a stay in the LPRT’s decisions, the two ASPs have been legally in place since the tribunal’s ruling in 2022.

Following a brief in camera session of council at its Tuesday (Oct. 3) meeting, Canmore Mayor Sean Krausert said the Town will not be seeking a leave to appeal with the Supreme Court of Canada and the plan is to adopt the two ASPs at the next council meeting.

The Town has 30 days from the release of the decision to adopt the two ASPs. Krausert noted that since the next council meeting is Nov. 7 – 35 days following the court ordered decision – a special meeting of council may have to be called in will be determined in the coming days.

TSMVPL continues to have a $161 million lawsuit against the Town and the previous council. Thunderstone Quarries also has a $63.5 million lawsuit against the Town since it owns lands in the Smith Creek ASP.

The appeal hearing came after the LPRT ordered the Town to adopt both ASPs in May 2022. The two decisions ruled entirely in TSMVPL’s favour, with the tribunal highlighting the 1992 NRCB decision has no expiration date for development to take place.

The LPRT hearings lasted 15 days with more than 110 hours of testimony, more than 5,000 pages of evidence presented, more than 3,000 pages of transcripts and nearly a dozen experts presenting and being questioned by the five-person board.

The Smith Creek ASP would see an estimated population of 2,200 to 4,500 people and includes about 1,000 and 2,150 residential units. The ASP includes upwards of 75,000-square-feet of light industrial and business space and roughly 125,000-square-feet of retail and commercial space for local services.

Three Sisters Village ASP could have between 3,000-5,000 residential units – which would depend on the bonus density element – and between 5,500-10,000 visitors and permanent population. It would include up to 602,000-square-feet of retail and business space and about 190,000-square-feet of indoor recreation and entertainment, with 75 hectares of open space and 10 per cent of affordable housing.

The ASP covers about 169 hectares.

“We are pleased to see this decision from the Alberta Court of Appeal. In the coming days, we will be reviewing the decision in its entirety and immediately undertaking the next steps in the process that lead to physical development on the property,” said Chris Ollenberger, director, TSMVPL strategy and development. “We believe that the court’s decision is not only good news for Three Sisters Mountain Village but for the entirety of Canmore and the Bow Valley. This decision is timely given the discussions on housing supply occurring in the community as Three Sisters is the main source of many types of housing in the valley.”

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