Jonathan Coady and Chenchen Yu

Once again, the time has come to review the year that was and to chart the course for the year ahead. For municipalities, developers and planning professionals throughout Prince Edward Island, this process often includes a survey of the decisions made by the Island Regulatory and Appeals Commission (“Commission”). The Commission is an independent tribunal that decides appeals from provincial and municipal land use planning decisions.¹ In 2017, the Commission released eight decisions. This summary reviews those decisions and distills a number of guiding principles for municipalities, developers and planning professionals in Prince Edward Island.

I. The Commission can implement a development permit; however, it cannot dictate the conditions of a permit or the terms of a development agreement.

In LA17-01, the developer requested that the Commission implement an order that it had previously issued. The order had directed a municipality to issue a development permit effective for the 2015 year. As a result of the failure of the parties to agree on the terms and conditions of a development agreement, the permit was not issued. The developer then requested intervention by the Commission, which has authority under the Planning Act to implement one of its orders when a municipality fails to do so.² The Commission found that the municipality had failed to implement its earlier order and issued a second order directing that a development permit be granted with certain conditions. The Commission also found that some provisions in the proposed development agreement were unreasonable and not valid. The municipality appealed to the Prince Edward Island Court of Appeal. The appeal was allowed in part.³ While the Court of Appeal held that the Commission was authorized to implement its earlier order by granting the development permit, the Court of Appeal found that the Commission exceeded its jurisdiction in two ways. First, the Commission did not have the authority to determine the validity of terms in the proposed development agreement. Second, the Commission did not have the authority to impose conditions on the permit. Those two functions were reserved for the municipality.

II. An official plan must be interpreted as a harmonious whole and in a manner that is consistent with the provincial planning regulations.

In LA17-02, the developer appealed a decision denying the rezoning of a property from agricultural to industrial. The municipality had reasoned that, according to its official plan, the intended use of the property had to be “fully serviced” and that phrase included both water and sewer services. Given that the municipality only provided a central water system, the property could not be rezoned. On appeal, the Commission quashed the decision. The Commission noted that an industrial use was not prohibited. Rather, the use of the property was subject to regulation. By interpreting one provision of its official plan to the exclusion of other relevant provisions, the municipality fell into error and acted unfairly. The Commission found that the official plan had to be interpreted as a whole and in harmony with provincial planning regulations. The Commission also found that, where sewer and/or water services were available, the municipal bylaw extended discretion to council to rezone land for an industrial use so long as that use could be accommodated by the service. The phrase “fully serviced” in the official plan, when properly interpreted, only included water service because sewer service was not presently available within the municipality. The proposed zoning amendment was therefore not contrary to the official plan and ought to have been approved.

III. In order to validly approve a request for rezoning, the intended use of the property must be a permitted use in the new zone. 

In LA17-03, a dissatisfied resident appealed a municipal decision to rezone a property from a residential zone to a public services and institutional zone (“PSI Zone”). The property was intended to be used as a private living centre for seniors. The Commission allowed the appeal. According to the text of the bylaw, the centre was not a permitted use in the PSI Zone. An institutional use was defined as one for a public or not-for-profit purpose. The proposed development, however, was private in nature. The Commission found that the error was fatal. The approval granted by the municipality wrongly accepted a proposed use that was not permitted in the PSI Zone. The Commission held that, if the municipality wanted the proposed use to be permissible within the PSI Zone, the municipality had to first amend its bylaw to add the proposed use to the list of permissible uses. The rezoning application could then be considered by the municipality.

IV. A notice of appeal filed with the Commission must identify legal or procedural errors, and dissatisfaction alone is not a valid ground of appeal.

In LA17-04, the landowner appealed a decision by the Minister that refused to approve a change in use. The notice of appeal was filed within the time period prescribed by the Planning Act. While the landowner was obviously dissatisfied with the decision in question, the notice of appeal did not particularize any errors of law or procedure by the Minister. Upon review of the record, the Commission identified no such errors and emphasized that the grounds for an appeal must be described in a meaningful way. Dissatisfaction with a planning-related decision will not, without more, constitute a ground for intervention by the Commission.

V. An appeal to the Commission must be filed within 21 days as required by the Planning Act.

In LA17-05, the Commission considered an appeal filed by a resident who was dissatisfied with a development permit being granted for a garage. The decision by the municipality had been made more than nine months before the appeal was filed. The Commission found that it did not have jurisdiction to hear the appeal because it was not filed within 21 days after the municipal decision as required by the Planning Act.⁴

VI. New uses of land remain subject to general land use planning principles and must still satisfy existing regulations.

In LA17-06, a dissatisfied resident appealed a decision by the Minister to grant two development permits. One permit approved a change in use from a storage building to a summer cottage. The second permit approved the relocation of three “storage” buildings. The relocated buildings were actually being used as sleeping quarters or “bunkies.” After taking a number of different preliminary positions, the Minister eventually argued at the hearing that the permits had been properly issued. In allowing the appeal, the Commission found that the Minister, by failing to inspect the septic system being used by the landowner, did not follow its regulatory procedure and did not apply sound planning principles. The first development permit was therefore quashed. As for the second permit, the Commission found that the Minister knew that the intended use of the “storage” buildings was not the use stated in the application. The Minister had also neglected to seek input from a professional land use planner. The Commission held that the Minister again failed to follow the proper procedure and again failed to consider sound planning principles. The second permit was also set aside. According to the Commission, it was no answer for the Minister to say that provincial planning regulations did not contemplate the use and development of “bunkies.” General planning rules and principles continued to apply.

VII. Notice of planning-related decisions must be published in accordance with the Planning Act, and all mandatory criteria must be considered by the Minister.

In LA17-07, a dissatisfied resident appealed a decision by the Minister to approve the subdivision of a lot for “rural tourism use.” The affected landowner then challenged the jurisdiction of the Commission, noting that the appeal had been filed outside of the prescribed time period of 21 days. After finding that it did have jurisdiction to hear the appeal, the Commission quashed the decision. The Commission found that the Minister had failed to publish notice of the decision in accordance with the requirements of the Planning Act.⁵ That failure, according to the Commission, meant that the appeal period began to run only after the resident had actual notice of the decision. The appeal had therefore been properly filed. At the hearing, there was also no evidence that the Minister had considered section 13 of the Subdivision and Development Regulations, which obligated the Minister to consider a number of factors, including compatibility with surrounding uses, topography of the site, surface drainage and natural features. By failing to consider these mandatory factors, the Minister did not follow the proper regulatory procedure. The subdivision approval was therefore set aside.

VIII. An official plan is binding upon a municipality and, even in the context of an as-of-right development, there is residual discretion to consider objective evidence of sound planning.

In LA17-08, the landowner appealed a municipal decision that denied a building permit for an apartment building. The building met the technical requirements for the zone, and the landowner took the position that its proposal was an as-of-right development. The municipality acknowledged that the landowner had the right to develop an apartment building on the property; however, it was of the view that any development still had to be consistent with the policies found in the official plan. In denying the appeal, the Commission found that, in Prince Edward Island, an official plan is legally binding upon a municipality and its landowners. In addition to satisfying the bylaw requirements for a particular zone, a development must also be consistent with the official plan. In other words, an official plan is not merely a recommendation or guideline. While the building proposed by the landowner was, on its face, an as-of-right development, the Commission held that the municipality had a limited residual discretion to deny approval on the basis of objective evidence. In the absence of an opinion from a professional planner that was contrary to the evidence provided by the planners for the municipality, the Commission found that the decision was reasonable and based on objective evidence of sound land use planning.

Lessons for the New Year

Thousands of planning-related decisions are made each year in Prince Edward Island. Only a tiny fraction of those decisions are subject to review by the Commission. When that statistical reality is considered in light of the accessible right of appeal granted by the Planning Act,⁶ it signals that the provincial land use planning system is working and that the decisions made by our provincial and municipal decision-makers are generally accepted. The Commission, for its part, exercises an oversight function that searches for legal errors and procedural defects. Its decisions therefore serve as guideposts for municipalities, developers and planning professionals as they move forward – together – to use our most precious resource in ways that are principled, efficient, and sustainable. It is hoped that this summary will also contribute to that objective in some small way. By drawing upon the lessons learned over the last year, decision-makers will not only minimize the risk of an appeal to the Commission, but also contribute to their proven record of making sound planning decisions for the benefit of Prince Edward Island and its residents.

¹ Outside the boundaries of incorporated municipalities, planning-related decisions are made by delegates of the Minister of Communities, Land and Environment (the “Minister”).
² R.S.P.E.I. 1988, c. P-8, s. 28(11).
³ 2017 PECA 23.
⁴ R.S.P.E.I. 1988, c. P-8, s. 28(1.3).
⁵ R.S.P.E.I. 1988, c. P-8, s. 23.1.
⁶ Generally speaking, any person who is dissatisfied with a planning-related decision can appeal to the Commission. See Planning Act, R.S.P.E.I. 1988, c. P-8, ss. 28(1) and (1.1).