Dec 01, 1995

Water Licenses Under the Water Act #246


By Gerry Neely
B.A., LL.B.

The water supply for a newly-created lot came through a pipe from a spring on the parent property, whose owner had consented to the continued use of this water by the purchaser of the lot. However, the lot purchaser did not bother to obtain an easement which would have given him the right to draw water and to maintain and repair the water line in perpetuity.

A subsequent buyer, from the owner of the parent property, brought an action against the lot purchaser for damages for trespass and an order that the pipeline be removed. He received an order for damages to be assessed, but was denied an immediate order for the removal of the pipeline. The basis for the denial were the rights attached to the water license issued to the lot purchaser under the British Columbia Water Act.

This Act gives the provincial government the right to control the use and flow of virtually all water in the province. Throughout the Act, the source of water is referred to as a "stream" which is defined to include lakes, rivers, creeks, springs, ravines, swamps and gulches. The province also has the right to control the use of ground water and water from drilled wells, but as of yet does not do so with one exception. That exception is found in the Water Protection Act, which prohibits the export of water from drilled wells.

There are a number of advantages in having a conditional water license, apart from the authority it gives the holder to take a quantity of water from a source that may be on his neighbour's property. It also authorizes the holder to construct and maintain the pipes and other equipment necessary to bring the water to the holder's property.

If the owner of the property containing the source of water refuses to grant the necessary easement, the holder has the right to commence expropriation proceedings to obtain it. If these proceedings are successful the owner is entitled to compensation.

The Water Act also requires an owner of land over which a water pipe is situated, who intends to interfere with its use, to give no less than six months notice, in writing, of what the owner proposes to do.

The lot purchaser countered the plaintiff's action by starting expropriation proceedings to obtain an easement. The plaintiff had failed to give the required six months' notice and a combination of this failure, together with the notice of expropriation, led to the dismissal of the plaintiff's action to have the water line removed.1


Occasionally a contract will be entered into for the purchase of property to be subdivided. Since the time to complete the subdivision may be difficult to know, an "outside" date may be set for completion with an agreement to complete earlier upon registration of the subdivision. In the alternative, a specific date may be set with an agreement that if the subdivision has not taken place by that date, then a new date will be agreed upon between the parties.

When the latter agreement exists, neither party can ignore it if the completion date passes without the subdivision having been created. Both parties, of course, may choose to end the contract either by express agreement, or by doing nothing to fix a new date.

However, if one party wants to complete the purchase, that party must set a new, reasonable, completion date. What is reasonable would depend upon the circumstances and how much further time should be given to the other party to produce money, or documents, or both. ff the party to whom the notice to fix a new completion date ignores it, that party is in breach of the contract.

This happened in a case where a purchaser had agreed to buy a lot for $153,000. Registration of the subdivision was delayed, and the seller fixed a new date for completion which the buyer ignored. The property was re-listed for sale in a falling market and it was sold for $135,000. The original buyer was held to be liable in damages to the seller for $18,000 plus interest and costs.2


A building scheme gave the developer the power to modify any of the restrictions with respect to any of the lots as it, in its discretion, decided. Its decision was to be final and binding and not open to question by any owner. The restrictions were intended to establish and maintain a neighbourhood for single-family dwellings, which had been advertised as, "an exceptional rural residential hillside development."

The developer waived the restrictions on a lot it owned enabling it to increase the density of that lot, to be developed in conjunction with adjoining land, also owned by the developer. The purchasers of the other lots objected to this and the developer applied for an order under Section 31 of the Property Law Act for the cancellation of the restrictions on the lot.

One of the arguments of the developer was that the purchasers were aware of the terms of the building scheme before they bought their lots and that by proceeding with their purchases they had knowingly consented to the developer's right to waive the restrictions. The judge refused to accept the argument that there was any implied consent by the purchasers for the removal of the prohibition against multiple family dwellings. The judge also felt that the developer's power, to waive or modify the restrictions, did not extend to the complete removal of all restrictions, notwithstanding the clear wording of the building scheme.3

 1. Rezzie v. Nikmo, S.C.B.C. Supreme Court, Reasons for judgment, July 4,1995.
 2. Beka v. Share, B.C.S.C., Reasons for judgment, January 12th, 1994.
 3. North Pacific Lands Ltd. v. Kroeker et al., Reasons for judgment, July 4th, 1995.

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