Expropriation vs. Eminent Domain

The main difference between expropriation and eminent domain is the country in which they are used. The foreboding term ‘expropriation’ in Canada describes the government’s right to acquire private property from landowners and convert it into public use without the landowner’s consent. This concept is called “compulsory purchase” in the United Kingdom, and “taking” or “condemnation” under the power of “eminent domain” in the United States.

How does Expropriation Work?

The process of expropriation in Ontario:

1. Notice of Intention for Approval to Expropriate.
   The first step involves a formal notice to be served on the landowner stating the government’s intention to seek approval for expropriation. This notice will also be posted in a local newspaper for a period of 3 weeks. During the notice period, the landowner can submit an inquiry as to whether the nature of the expropriation is considered “fair.”
     
2. Registration of Expropriation on Title.
   Once approval of expropriation is granted, it is registered on the title of the property and served to the owner.

    

3. Appraisal of Lands & Compensation Offer
   The expropriating authority conducts an appraisal of the land to determine what is deemed “fair value.” A compensation offer is then presented to the landowner and they can respond in one of two ways:

• Accept the offer as full settlement for expropriation; or
• Choose to accept the offer ‘without prejudice’ – what this means is that the landowner can receive compensation, but reserves their right to claim more than the amount offered through negotiation or appeal

Land Acquisition

By definition, any individual or entity that owns land, doesn’t really own land per se. For example, Canadians only hold land tenure (permission to hold land from the Crown) rather than absolute ownership. Land in Canada is primarily owned by the Crown (Queen Elizabeth II) and is administered by various agencies and departments of the government of Canada on the Crown’s behalf. Only about 10% of Canadian land is privately owned, while the rest is Crown land. The land in Canada is mainly used as national parks, forests, private homes, and agriculture.  

In Canada, all levels of government possess the legal right to obtain private property for public use. Landowner’s do not have a constitutional right to own property and therefore are not protected by the Canadian Charter of Rights and Freedoms. This is not to say that there are no rights to due process or administrative fairness when the government asks to take your land. It merely means that the landowner’s rights are found in the expropriation legislation and not the Charter. While the federal government can expropriate land, (Expropriation Act, RSC, 1985) most expropriations come under provincial legislation. Each province has applicable legislation.

The Expropriation Act, RSO, 1990, governs the process of expropriation in Ontario and mediates the inevitable conflict between private real property rights and the public need for that same land.

The government may acquire your entire property or a portion of your property. A partial expropriation can have a detrimental impact on the use and value of your land – this concept is called “injurious affection.” The landowner can suffer from injurious affection even if their property is not expropriated. For example, a loss of access to your property by a physical interference or a complete obstruction of access that decreases the value of your property or results in a loss of business. 

What Constitutes as Public Use?

These important public uses include the construction or expansion of highways and roads, water and other public utility systems, schools, transportation systems such as rail tracks, airports and subways in cities, pipelines, parks or the expansion of municipal boundaries.

Compensation Concerns Regarding Expropriation

The process of expropriation does raise justifiable concerns ranging from the acceptable reasons for the expropriation, the process for recourse, the inconvenience of being required to relocate, and the scope and amount of fair compensation and business loss. With regard to compensation, there is debate as to what constitutes fair as the definition of “fair market value” can fall short of what landowners may demand and possibly receive. Given the obvious imbalance of power between landowners and the government, the legislation provides numerous safeguards that favour the owner in the expropriation process. These include the rights:

• To be notified of the expropriation;
• To be notified of all steps being taken by the government in the process;
• To challenge the expropriation; and
• To representation by a lawyer in that process.

If landowners are not content with the expropriator’s initial proposal, they have the right to:

• A formal offer of compensation;
• A record of appraisal;
• Negotiation the compensation; and
• A public hearing or inquiry procedure before an independent administrative tribunal.

   

Expropriation proceedings are complicated. It is therefore essential to ensure that an expropriation owner is properly represented early in the expropriation process. Contact Jeff Goldstein at Goldstein Law for a consultation.