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In the Court of Appeal of Alberta

Citation: CFPM Management Services Ltd. v Edmonton (City), 2019 ABCA 3

Date: 20190109
Docket: 1803-0310-AC
Registry: Edmonton

Between:

CFPM Management Services Ltd.

Applicant

- and -

The City of Edmonton and


The City of Edmonton Subdivision and Development Appeal Board

Respondents

_______________________________________________________

Reasons for Decision of


The Honourable Madam Justice Ritu Khullar
_______________________________________________________

Application for Permission to Appeal


_______________________________________________________

Reasons for Decision of


The Honourable Madam Justice Ritu Khullar
_______________________________________________________

I. Introduction

[1] This permission to appeal concerns the City of Edmonton’s regulation of cannabis sales.
Since 2015, the applicant, CFPM Management Services Ltd., has carried on the sale of cannabis
paraphernalia from a store operated as the Green Room, located in the historical commercial area
of Old Strathcona in Edmonton. The Green Room seeks to appeal a decision of the City of
Edmonton Subdivision and Development Appeal Board (SDAB), which upheld the refusal of the
City’s development officer to change the Green Room’s use from a General Retail Store to
Cannabis Retail Sales.

II. Background

[2] On June 12, 2018, Edmonton City Council enacted Bylaw 18387, A Bylaw to amend Bylaw
12800, as amended, and Bylaw 18431, Amendment to the Strathcona Area Redevelopment Plan,
which addressed the pending decriminalization of recreational cannabis.

[3] Among other things, Bylaw 18387 amended Bylaw 12800, Edmonton Zoning Bylaw,
which is the general bylaw governing municipal zoning, to introduce “Cannabis Retail Sales” as a
permitted use in a number of conventional, non-direct control districts. Bylaw 18431 added
“Cannabis Retail Sales” to the list of permitted uses under the Strathcona Area Redevelopment
Plan Historical Commercial DC1 (Strathcona ARP). The Strathcona ARP is a delegated direct
development control district, which means that the uses and development standards for the district
are set out in the ARP: see Frederick A Laux, Planning Law and Practice in Alberta, 3rd ed
(Edmonton: Juriliber, 2002) (loose-leaf updated 2013, update no 3) at §6.2(2)(c)(ii).

[4] Subsections 70(1) to (4) of the Zoning Bylaw,1 as amended, provides for, among other
things, the minimum separation distances for a Cannabis Retail Sales of: 200 metres from any
other Cannabis Retail Sales location (s 70(1)); 200 metres from a public library or school (s 70(2));
and 100 metres from public lands zoned as a park (s 70(3)).

[5] The Green Room is located on a site zoned as DC1 Direct Development Control under s
710 of the Zoning Bylaw. All developments on this site are required to comply with the
development regulations contained in the Strathcona ARP, as well as the regulations in the Zoning
Bylaw.

[6] Section 710.4(5) of the Zoning Bylaw provides that:

1
Full text of sections 69, 70 and 710 of Zoning Bylaw are in the Appendix to these reasons.
Page: 2

All regulations in this Bylaw shall apply to development in the Direct Development
Control Provision, unless such regulations are specifically excluded or modified in
a Direct Development Control Provision.

The Green Room is located on 103 Street south of 82 Avenue and in the area covered by the
Strathcona ARP. On the other side of the street opposite the Green Room, there is a small green
space zoned as a park.

[7] On July 4, 2018, the Green Room applied to the City of Edmonton for a Major
Development Permit to change the use of the store from a General Retail Store to Cannabis Retail
Sales.

[8] On August 30, 2018, the development officer for the City refused the permit application
because the proposed Cannabis Retail Store did not comply with the minimum separation
distances requirement of 100 metres from the park (it is 21 metres away), and 200 metres from
another approved Cannabis Retail Sales store (it is located 153 metres from a store, located on 80
Avenue and 104 Street outside of the Strathcona historical commercial area).

[9] The development officer noted that he was prohibited from granting sufficient variances to
the separation distances that would allow the permit to be granted. Section 70(1)(b) only permits a
variance of up to 20 metres between stores, and no variance is permitted from the school or park (s
70(4)).

[10] On September 18, 2018, the Green Room appealed the refusal of its permit application to
the SDAB. The Green Room sought variances from the SDAB with respect to both separation
distances, in order to enable the proposed development to proceed.

III. SDAB Decision

[11] The SDAB rendered its decision on October 31, 2018, dismissing the appeal. Under s
685(4)(b) of the Municipal Government Act, RSA 2000, c M-26 [MGA], the appeal of a
development permit application in respect of a Direct Control District is limited to whether the
development authority followed the directions of council.

[12] As the Strathcona ARP does not have regulations for Cannabis Retail Sales, and relying on
s 710.4(5) of the Zoning Bylaw, the SDAB held that it was the direction of Edmonton City Council
that proposed Cannabis Retail Sales must comply with the development regulations contained in s
70 of the Bylaw.

[13] Because the Green Room is located 21 metres from the nearest park, the SDAB found that
it did not comply with the 100 metre separation distance from public lands established by s 70(3).
Thus, it concluded, the development officer did follow the direction of Council by refusing the
development permit application.
Page: 3

[14] In addition, the SDAB held that the development officer had no variance power in the
matter, due to the operation of s 70(4) of the Zoning Bylaw. Citing Garneau Community League v
Edmonton (City), 2017 ABCA 374 at paras 39-40, 26 Admin LR (6th) 304 [Garneau], the SDAB
stated that it could not exercise any variance power not given to the development authority under
the Zoning Bylaw.

[15] Having concluded that the development officer followed the directions of Council and that
the SDAB could not exercise a variance power itself, the SDAB declined to resolve the second
issue of whether a variance should be granted to the minimum required separation distance from
the nearest Cannabis Retail Store under s 70(1). Thus, it dismissed the applicant’s appeal.

IV. Proposed Grounds of Appeal

[16] The applicant now seeks permission to appeal the decision of the SDAB on the grounds
that the SDAB erred in law or jurisdiction:

(a) in holding that it lacked the authority to grant a variance to the separation distances
provided under s 70 of the City of Edmonton Zoning Bylaw 12800; and

(b) in holding that the development officer who had refused the applicant’s development
permits application had followed the directions of Edmonton City Council.

[17] The appeal really turns on an interpretation of s 710.4(3) of the Bylaw which states:

A development may also be evaluated with respect to its compliance with:

a. the objectives and policies of an applicable Statutory Plan;

b. the General Regulations and Special Land Use Provisions of this Bylaw;
and

c. the regulations of abutting Zones. (emphasis added)

Specifically, the Green Room argues that the SDAB erred in law or jurisdiction by failing to find
that s 710.4(3) of the Zoning Bylaw is a separate grant of discretion to the development officer
which, when read with the Strathcona ARP, could have been exercised to vary the separation
distances in s 70 of the Zoning Bylaw.

V. Test for Permission to Appeal

[18] Under s 688(3) of the MGA, a single judge of this Court may grant permission to appeal a
decision of the SDAB if the appeal “involves a question of law of sufficient importance to merit a
further appeal and has a reasonable chance of success.”
Page: 4

[19] As Brown JA (as he then was) explained, whether an appeal is “of sufficient importance”
depends on “factors including the effect of the decision on the applicant . . . and the merits of the
proposed appeal”: Carleo Investments Ltd v Strathcona (County), 2014 ABCA 302 at para 10, 28
MPLR (5th) 173. The standard of review is a relevant consideration in determining the merits of
the proposed appeal: Edmonton (City) v Edmonton (Subdivision and Development Appeal
Board), 2018 ABCA 316 at paras 6-9, 297 ACWS (3d) 191.

VI. Analysis

A. Submissions of the Parties

[20] The Green Room submits that like the situation in Garneau, there are two possible grants
of the variance power in this case. First, it recognizes that there is a general variance power under
s 11 of the Zoning Bylaw. Recourse to s 11 to vary a required distance from public lands is
expressly prohibited by s 70(4) of the Bylaw, in the context of Cannabis Retail Sales. Second, it
submits that “there is a separate grant of discretion to the Development Officer under Section
710.4 of the Zoning Bylaw read with the Strathcona ARP”: Memorandum of Argument at para 29.

[21] The Green Room denies that s 710.4(5) requires developments in the Direct Control
District to comply with ss 69 and 70 of the Bylaw. It contends that because the Zoning Bylaw
classifies ss 69 and 70 as “Special Land Use Provisions”, the reference to “regulations in this
Bylaw” does not encompass those provisions: s 710.4(5) (emphasis added).

[22] Relying on s 710.4(3), the Green Room submits that the Zoning Bylaw confers a discretion
on the development officer to “also . . . evaluat[e]” a development permit application for a site
within the Strathcona ARP “with respect to its compliance with . . . the objectives and policies of
an applicable Statutory Plan”: s 710.4(3)(a). Section 710.4(3)(b) refers to “General Regulations
and Special Land Use Provisions of this Bylaw,” which according to the Green Room,
encompasses the provisions for Cannabis Retail Sales under s 70 of the Zoning Bylaw.

[23] When s 710.4(3) is read in conjunction with the Strathcona ARP, the Green Room submits,
there is an express grant to the development officer of discretion as to how to apply the provisions
in s 70, including the prohibition on variance under s 70(4). Based on this interpretation of the
Zoning Bylaw, it argues that the development officer did, in fact, possess the power to vary the
separation distances if such a variance would comply with “the objectives and policies of” the
Strathcona ARP: s 710.4(3)(a).

[24] The Green Room argues that the development officer’s decision was contrary to the
objectives and policies of the Strathcona ARP, because it results in virtually no qualifying
development sites for Cannabis Retail Sales in the Old Strathcona historical commercial area.
Since Council adopted a general rezoning, rather than a spot rezoning, Council could not have
intended to confine Cannabis Retail Sales to a single specific site in Old Strathcona. Consequently,
Council’s intention to allow cannabis sales in Old Strathcona, a geographically small area, was
Page: 5

frustrated by non-variance of the distances contained in ss 70(1), (2), and (3) of the Zoning Bylaw.
The Green Room cites the Glenora Liquor SDAB decision (SDAB-D-17-071, May 4, 2017), in
which the SDAB found that Council did not intend the strict application of a separation distance
requirement, without the possibility of variance, to frustrate its stated intent to allow alcohol sales
in a Site Specific Development Control Zone.

[25] Accordingly, the Green Room submits that the development officer did not comply with
Council’s directions when he refused the Green Room’s development permit application. It is
consistent with Garneau to recognize that a separate variance power existed under s 710.4(3) of
the Zoning Bylaw, which should be applied in favour of the Green Room.

[26] The City submits that s 710.4(3) does not create any sort of variance power, and even if it
did, the directions of Council on variances for Cannabis Retail Stores are clearly and specifically
set out in the Zoning Bylaw. The City advances three arguments in support of its position that the
proposed appeal has no prospect of success.

[27] First, the City argues that s 710.4(3) of the Zoning Bylaw does not, and cannot, authorize
variances to separation distances. Section 11 of the Zoning Bylaw is the only provision that gives a
development officer the power to grant variances. In contrast, the purpose of s 710.4(3) is merely
to facilitate a development officer’s discretionary decision-making where Council has, in fact,
bestowed discretion on the officer. For example, the Strathcona ARP lists 35 permissible uses as
well as a broad category of “[u]ses consistent with the rationale of this Provision”: Strathcona ARP
at para 4(jj). The City, for instance, suggests that the factors in s 710.4(3) guide the determination
of whether a proposed use falls within the scope of ss 4(jj); it is not an independent grant of power.

[28] Second, the City argues that even if s 710.4(3) does create a variance power, that power
cannot override Council’s express directions on Cannabis Retail Store separation distances. As a
Special Land Use Provision, s 70 of the Bylaw “shall take precedence and be applied in addition to
the requirements of the Zone, except where a Zone, Direct Control Provision or Overlay
specifically excludes or modifies these provisions with respect to any use”: s 69. Section 70
eliminates the variance power in relation to public lands (s 70(4)) and limits it to 20 metres in
relation to store-to-store distance (s 70(1)(b)). Municipal legislation should be interpreted “to
giv[e] effect to the intention of the Municipal Council as expressed in the bylaw upon a reasonable
basis that will accomplish that purpose”: Society of Fort Langley Residents for Sustainable
Development v Langley (Township), 2014 BCCA 271 at para 18, 375 DLR (4th) 160 [Langley].
Therefore, ss 69 and 70 of the Bylaw should be interpreted to give effect to Council’s intention to
impose separation distances without, or with only minimal, variances.

[29] Third, the City denies that the SDAB decision will result in virtually no sites for Cannabis
Retail Stores in Old Strathcona. If there are few sites for cannabis sales in Old Strathcona, the
cause is not a zoning absurdity, but rather the prior approval of a competing store that precluded
other cannabis stores within 200 metres. Even with the store on 80 Avenue and 104 Street, the City
notes that three locations within the Direct Control area remain compliant with the separation
Page: 6

distance requirements. In any event, arguments for a higher density of cannabis stores are more
appropriately raised in a political forum.

[30] In the City’s view, the Glenora Liquor decision can be distinguished on the facts, given the
different purposes of a Direct Control District and Site Specific Development Control Zone; the
different bylaw provisions governing each district; and certain factual differences in how the
inability to comply with the separation distances arose. Importantly, Glenora Liquor resolved a
direct conflict between general and specific regulations in the Bylaw by favouring the application
of the specific regulation. Here, the City submits that there is no conflict between the separation
distances found in s 70 and the provisions in s 710.4(3) governing the Strathcona ARP.

B. Does the proposed appeal involve a question of law of sufficient importance to


merit a further appeal and have a reasonable chance of success?

[31] I find that the Green Room’s application meets the test for permission to appeal, and
permission is granted to appeal on the following question as proposed by the Green Room:

Did the SDAB err in law or jurisdiction in holding that (a) it lacked the authority to
grant a variance to the separation distances provided in s 70 of the City of
Edmonton Zoning Bylaw 12800; and (b) the development officer who had refused
the applicant’s development permits application had followed the directions of
Edmonton City Council.

VII. Conclusion

[32] The application for permission to appeal is granted.

Application heard on December 19, 2018

Reasons filed at Edmonton, Alberta


this 9th day of January, 2019

Khullar J.A.
Page: 7

Appearances:

K.D. Wakefield, Q.C.


for the Applicant

M.S. Gunther
for the Respondent City of Edmonton

P.A. Smith (no appearance)


for the Respondent City of Edmonton Subdivision and Appeal Board
Page: 8

Appendix

Excerpts of Zoning Bylaw

69. Special Land Use Provisions

69.1 Applicability

1. The Special Land Use Provisions apply to the Uses listed in any Zone or Direct Control
Provision in which they are located. They shall take precedence and be applied in addition to the
requirements of the Zone, except where a Zone, Direct Control Provision or Overlay specifically
excludes or modifies these provisions with respect to any Use.

70. Cannabis Retail Sales

1. Any Cannabis Retail Sales shall not be located less than 200 m from any other Cannabis
Retail Sales. For the purposes of this subsection only:
a. the 200 m separation distance shall be measured from the closest point of the Cannabis
Retail Sales Use to the closest point of any other approved Cannabis Retail Sales Use;
b. A Development Officer shall not grant a variance to reduce the separation distance by
more than 20 m in compliance with Section 11; and
c. The issuance of a Development Permit which contains a variance to separation distance
as described in 70(1)b shall be issued as a Class B Discretionary Development.
2. Any Site containing a Cannabis Retail Sales shall not be located less than 200 m from any
Site being used for a public library, or for public or private education at the time of the
application for the Development Permit for the Cannabis Retail Sales. For the purposes of
this subsection only:
a. the 200 m separation distance shall be measured from the closest point of the subject
Site boundary to the closest point of another Site boundary, and shall not be measured
from Zone boundaries or from the edges of structures;
b. the term “public library” is limited to the collection of literary, artistic, musical and
similar reference materials in the form of books, manuscripts, recordings and films for
public use, and does not include private libraries, museums or art galleries; and
c. the term “public or private education” is limited to elementary through to high schools
inclusive only, and does not include dance schools, driving schools or other
Commercial Schools.
3. Any Site containing a Cannabis Retail Sales shall not be located less than 100 m from any
Site being used for Community Recreation Services Use, a community recreation facility,
a provincial health care facility, as public lands, or any Site that is designated as school
reserve or municipal and school reserve at the time of the application for the Development
Permit for the Cannabis Retail Sales. For the purposes of this subsection only:
Page: 9

a. the 100 m separation distance shall be measured from the closest point of the subject
Site boundary to the closest point of another Site boundary, and shall not be measured
from Zone boundaries or from the edges of structures;
b. the term “community recreation facilities” means indoor municipal facilities used
primarily by members of the public to participate in recreational activities conducted at
the facilities, as per the Municipal Government Act; and
c. the term “public lands” is limited to Sites zoned AP, and Sites zoned A.
4. Notwithstanding Section 11 of this Bylaw, a Development Officer shall not grant a
variance to subsection 70(2) or 70(3).

710 (DC1) Direct Development Control Provision

710.1 General Purpose

The purpose of this Provision is to provide for detailed, sensitive control of the Use, development,
siting and design of buildings and disturbance of land where this is necessary to establish, preserve
or enhance:

a. areas of unique character or special environmental concern, as identified and specified in


an Area Structure Plan or Area Redevelopment Plan; or
b. areas or Sites of special historical, cultural, paleontological, archaeological, prehistorical,
natural, scientific or aesthetic interest, as designated under the Historical Resources Act.

710.2 Application

1. This Provision shall only be applied:


a. where specified by an Area Structure Plan or Area Redevelopment Plan; or
b. to those historical resources that have been designated by the Minister or by
Council, in accordance with the Historical Resources Act.
710.3 Uses

1. A Development Permit may be issued for those Uses prescribed for the land, in an
approved Area Redevelopment Plan or Area Structure Plan, or those Uses consistent
with its designation under the Historical Resources Act.

710.4 Development Regulations

1. All developments shall comply with the development regulations contained in an


approved Area Redevelopment Plan or Area Structure Plan, except that any regulations
or conditions applying as a result of designation of a historical resource under the
Historical Resources Act, shall take precedence.
Page: 10

2. In the case of designated historical resources, any application to demolish, alter, restore
or repair a building or structure, or to excavate or otherwise disturb land, shall require
prior written authority, in accordance with the Historical Resources Act.
3. A development may also be evaluated with respect to its compliance with:
a. the objectives and policies of an applicable Statutory Plan;
b. the General Regulations and Special Land Use Provisions of this Bylaw; and
c. the regulations of abutting Zones.
4. Signs shall comply with the regulations found in Schedule 59H.
5. All regulations in this Bylaw shall apply to development in the Direct Development
Control Provision, unless such regulations are specifically excluded or modified in a
Direct Development Control Provision.

710.5 Information Requirements

1. In addition to the information normally required for a Development Application under


this Bylaw, the applicant shall submit all information specified in an applicable Area
Redevelopment Plan or Area Structure Plan and a narrative explaining how the
proposed Use or development would be consistent with the intent of the Provision.
2. If the Development Application concerns a historical resource designated under the
Historical Resources Act, a Copy of the Minister’s written approval or Council’s
written approval, as may be required, shall be submitted with the application.
3. The Development Officer may request any additional information they deem
appropriate in order to determine whether the proposed Use or development is
consistent with an approved Statutory Plan.