Court headnote

Longueuil (City) v. Lambert-Picotte
Collection
Supreme Court Judgments
Date
1991-06-27
Report
[1991] 2 SCR 401
Case number
21151
Judges
Lamer, Antonio; La Forest, Gérard V.; L'Heureux-Dubé, Claire; Sopinka, John; Gonthier, Charles Doherty; Cory, Peter deCarteret; McLachlin, Beverley
On appeal from
Quebec
Subjects
Expropriation
Notes
SCC Case Information: 21151
Decision Content
Longueuil (City) v. Lambert‑Picotte, [1991] 2 S.C.R. 401
Dame Jeanne D'Arc Lambert Appellant
v.
City of Longueuil Respondent
Indexed as: Longueuil (City) v. Lambert‑Picotte
File No.: 21151.
1991: January 31; 1991: June 27.
Present: Lamer C.J. and La Forest, L'Heureux‑Dubé, Sopinka, Gonthier, Cory and McLachlin JJ.
on appeal from the court of appeal for quebec
Expropriation ‑‑ Indemnity ‑‑ Whether a transaction or an agreement between parties as to indemnity in event of expropriation ‑‑ Whether Court of Appeal erred in intervening in Expropriation Tribunal's decision ‑‑ Expropriation Act, R.S.Q., c. E‑24, ss. 19, 68 ‑‑ Civil Code of Lower Canada, art. 1918.
Expropriation ‑‑ Indemnity ‑‑ Additional indemnity ‑‑ Provisional indemnity less than one third of final indemnity ‑‑ Whether granting of additional indemnity justified ‑‑ Whether provisional indemnity should be taken into account in calculation of additional indemnity ‑‑ Expropriation Act, R.S.Q., c. E‑24, s. 68.
In 1974, the City of Longueuil entered into negotiations with the appellant for the purchase of her land, to establish an outdoor recreation centre. After several meetings, the parties entered into an offer of sale setting the purchase price at $500,000. At this time, both parties were well aware that the appellant could not deliver clear title to the property because of an existing dispute between the appellant and another party. The City took no further action regarding the offer of sale. Rather, the City chose to file a notice of expropriation, one day after the expiration of the six-month deadline set out in the offer to execute the deed of sale. Paragraph 8 of the notice of expropriation indicated that expropriation was undertaken "without prejudice to its rights and remedies resulting from any deed or agreement already concluded with the expropriated party".
On a motion before the Superior Court, the City was granted "prior possession" of the property. The motion stated that the City had offered an indemnity of $500,000 but that the appellant had not yet accepted it. The City put $500,000 on deposit and, a year later, the appellant's motion to withdraw the money was granted without prejudice to her right to claim a greater indemnity in the expropriation proceedings. When the case was finally remitted to the Expropriation Tribunal, the City contended that there had been a transaction between the parties with regard to the value of the land upon expropriation. The Tribunal rejected this argument, set the value of the land at $1,714,936, and ordered the City to pay the appellant with an additional indemnity calculated on the total award. The Tribunal's decision was homologated by the Superior Court. The Court of Appeal set aside the Tribunal's decision. It held that, whether it was a transaction or a contract between the parties, a binding agreement existed between the parties as to the indemnity upon expropriation.
The present appeal is to determine whether, prior to the expropriation proceedings, the parties had entered into either a transaction or an agreement regarding the indemnity to be paid by the City on the expropriation of the land. A subsidiary issue concerns the discretion of the Expropriation Tribunal in awarding and calculating an additional indemnity on the total or defalcated award.
Held (Lamer C.J. and Sopinka J. dissenting): The appeal should be allowed.
(1) Whether there was a transaction or an agreement
Per La Forest, L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ.: In order to reverse the conclusions of fact made by the Expropriation Tribunal, the Court of Appeal has to determine that the Tribunal had either grossly misconstrued the evidence so as to constitute an injustice, erred in law, or misapplied the law. The Expropriation Tribunal made no error in concluding that there was no transaction between the parties, because the requirements of art. 1918 C.C.L.C. were not met. At the time the offer was signed, there was no lawsuit, legal relationship, or contentious legal question between the parties which could be the subject of a transaction under art. 1918. In addition, there were no "concessions or reservations" made by either party to prevent future litigation over disputed rights. When the transaction allegedly occurred, the City had not yet passed a resolution, and therefore did not have the power, to expropriate the land. There was no evidence of a transaction in this case.
Per L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ.: The Expropriation Tribunal correctly concluded that there was no agreement between the parties as to indemnity in the event of expropriation. The evidence does not support the existence of an oral agreement on the indemnity. The offer itself is silent and the testimony is inconclusive. Nothing in the written material filed in the record supports the City's contention that, prior or subsequent to the offer of sale, the parties even discussed, let alone agreed to, either the value of the land on expropriation or the indemnity to be paid in case of expropriation. Although a subsequent letter from the appellant's lawyer to the City's notary suggested the City could proceed by expropriation to obtain clear title, the letter did not allude to an agreement about the price to be paid. The caveat in paragraph 8 of the expropriation notice does not establish that there was an agreement regarding indemnity. There is no reference to an agreement, nor to the date, content or price of an indemnity. In its motion for prior possession, the City specifically admitted that there was no agreement, stating that the appellant had "not yet accepted" the City's offer. The City did not indicate its reliance on any agreement: the motion to allow the withdrawal of the $500,000 went uncontested, the motion to refer the matter to the Expropriation Tribunal to fix the indemnity was made on consent, and the City at no time protested the appellant's detailed claim for indemnity. Therefore, there was no agreement and the Court of Appeal erred in reversing the findings of the Expropriation Tribunal.
Accordingly the appeal should be allowed. The Expropriation Tribunal's award as to the value of the expropriated land was not challenged and must stand.
Per La Forest J.: Given its obvious advantage in weighing the evidence, there is no reason to depart from the Expropriation Tribunal's view that the representative of the City was persistent to the point of harassment in his dealings with the appellant. Assuming there could nonetheless be said to have been an agreement of sale, the method by which the City carried out the expropriation procedures clearly indicated that it did not intend to rely upon the offer of sale. The Court of Appeal's opinion that there was an agreement, which is based almost exclusively on paragraph 8 of the expropriation notice, goes against the weight of the evidence and the factual findings of the Tribunal. It is true that the renunciation of a right should never be presumed and must be interpreted narrowly. However, in this case, the City's actions have met that threshold and cannot be interpreted in any other manner than a renunciation of its rights under the offer of sale.
Per Lamer C.J. and Sopinka J. (dissenting): While the conditions for the existence of a transaction were not met in this case and even though the parties did not expressly enter into an agreement as to indemnity, there remained throughout a valid and enforceable agreement for the sale of the property. A court should not conclude that a party has tacitly renounced its rights by virtue of a binding and enforceable agreement unless the circumstances are such that any other conclusion would be implausible. The notion of renunciation must be interpreted narrowly. Here, the Expropriation Tribunal erred in concluding that the City renounced its rights under the agreement when it commenced the expropriation proceedings. The mere fact that the expropriation notice was sent one day after the expiry of the six‑month deadline for signing the deed of sale was insufficient to render the offer null. Unless this is expressly stipulated, the time allowed for signing the deed of sale is not generally a strict time limit. There was no express stipulation to that effect in this case. Further, the City did not renounce its rights under the offer when it did not attempt to enforce the agreement before proceeding with the expropriation. A mise en demeure is not always a necessary precondition to the exercise of rights under an agreement. In this case, the mise en demeure would have served no useful purpose given the well‑known fact that the appellant could not provide clear title. Finally, the expropriation notice did not constitute the notice of termination envisaged in the offer of sale. There was no mention in the expropriation notice of the City's intention to withdraw its acceptance under the offer. On the contrary, the City expressly reserved its rights under any agreement which may exist between the parties.
Given that there was no renunciation by the City, the Tribunal was bound to respect the agreement which had been entered into by the parties. It was not shown that the alleged harassment rendered the agreement null and void. The principle which is to guide the Tribunal in fixing the indemnity is the value of the property to the party being expropriated. Here, the maximum value of the property to the appellant was the price of $500,000 stipulated in the agreement of sale by which the appellant was still bound when the property was expropriated.
(2) Additional Indemnity
Per La Forest, L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ.: The decision to grant an additional indemnity is discretionary under s. 68 of the Expropriation Act. The additional indemnity is a measure of damages, not of interest. While there are no exhaustive criteria for allowing such an indemnity, the main criteria are whether there has been undue delay, negligence by the expropriating party in completing the hearings, or an insufficient offer bearing no reasonable relation to the indemnity fixed. The conduct of the expropriating party may also be relevant. In the present case, the Expropriation Tribunal found that the difference between the provisional indemnity and the final indemnity was so large that it justified awarding an additional indemnity. There is no reason to interfere with its conclusion that the City sought to obtain the property on payment of a "trifling indemnity" which was "clearly insufficient".
Under s. 68, the Expropriation Tribunal also has discretion to deduct the provisional indemnity from the final indemnity in order to determine the amount of the additional indemnity. The Tribunal's interpretation of s. 68 was not agreed with on this issue. Since there are no exhaustive criteria, the discretion to make a deduction must be exercised with regard to the particular circumstances of each case. In this case, the parties have agreed that the provisional indemnity should be deducted in calculating the additional indemnity. The Tribunal's award should be reduced accordingly.
Cases Cited
By L'Heureux‑Dubé J.
Referred to: D. Dupéré Inc. v. Procureur général du Québec, C.A. Québec, No. 200‑09‑000397‑74, September 1, 1977; Cité de Ste‑Foy v. Société Immobilière Enic Inc., [1967] S.C.R. 121; Bellerose v. Talbot, [1957] Que. Q.B. 637, aff'd [1958] S.C.R. 261; Isabelle v. Procureur général du Québec, [1953] Que. Q.B. 747n; Ministre des Transports du Québec v. Texaco Canada Ltée, J.E. 83‑389; Robitaille v. Cité de Québec, [1948] Que. K.B. 787; Amusement Realty Corp. v. Minister of Roads of Quebec, [1949] Que. K.B. 562n; Yves Germain Inc. v. Ministre de la Voirie du Québec, [1974] C.A. 184; Labbé v. Ministre des Transports du Québec, [1980] C.A. 518; Lemieux v. Ville de Granby, [1980] R.P. 285; Procureur général du Québec v. Marois, J.E. 83‑475; Société d'aménagement de l'Outaouais v. Dumouchel, [1984] C.A. 571; Immeubles P.J. Ltée v. Laval (Ville de), J.E. 85‑676; Sylvestre v. Procureur général du Québec, [1980] C.A. 508; Club athlétique Champlain Ltée v. Ministre de la Voirie du Québec, [1979] C.A. 161; Louis Donolo Inc. v. Ville de Laval, [1979] R.P. 17; Allard v. Ville de Québec, [1978] T.E. 463; Anjou (Town) v. Krum (1990), 44 L.C.R. 266, 38 Q.A.C. 1; Ville de Montréal v. Lerner, [1979] C.A. 152; Corporation de la ville de Princeville v. Houle, [1985] T.E. 186; Commission scolaire de la Jeune Lorette v. Fédération des Caisses populaires Desjardins de Québec, C.A. Québec, No. 200‑09‑000354‑834, August 28, 1985; Cemp Investments Ltd. v. Lakeshore School Board, [1985] C.A. 584; Travelers Insurance Co. of Canada v. Corriveau, [1982] 2 S.C.R. 866; Ville de Laval v. Entreprises Lagacé Inc., T.E., No. 34‑001811‑76M, January 16, 1986; Restaurants et Motels Châtelaine International Ltée v. Procureur général du Québec, [1980] C.A. 511.
By La Forest J.
Referred to: Gingras v. Gagnon, [1972] C.A. 306.
By Sopinka J. (dissenting)
Sosiak v. Marto Construction Inc., [1976] C.A. 286; Lipari v. Hébert, C.A. Montréal, No. 500‑09‑000414‑888, February 19, 1991; Svatek v. Abony, [1986] R.D.I. 605; British and Beningtons, Ltd. v. North Western Cachar Tea Co., [1923] A.C. 48; MacKiw v. Rutherford, [1921] 2 W.W.R. 329; Gingras v. Gagnon, [1972] C.A. 306; Corporation municipale de la ville de St‑Georges Ouest v. Comact Inc., [1980] C.A. 521; Anjou (Town) v. Krum (1990), 44 L.C.R. 266, 38 Q.A.C. 1; Hillingdon Estates Co. v. Stonefield Estates Ld., [1952] Ch. 627; Disposal Services Ltd. v. Municipality of Metropolitan Toronto (1973), 4 L.C.R. 242 (Ont. L.C.B.), aff'd (1973), 5 L.C.R. 91 (Ont. Div. Ct.).
Statutes and Regulations Cited
Civil Code of Lower Canada, arts. 1056c, 1918.
Expropriation Act, R.S.Q., c. E‑24, ss. 19, 20, 32 [am. 1983, c. 21, s. 7], 53.11 [ad. idem, s. 12], 68 [am. idem, s. 18].
Authors Cited
Dorion, Guy et Roger Savard. Loi commentée de l'expropriation du Québec. Québec: Presses de l'université Laval, 1979.
Giroux, Lorne. "L'expropriation en droit québécois" (1980), 10 R.D.U.S. 629.
Mignault, Pierre Basile. Le droit civil canadien, t. 8. Montréal: Wilson & Lafleur, 1909.
APPEAL from a judgment of the Quebec Court of Appeal (1988), 30 Q.A.C. 168, 40 L.C.R. 182, which set aside an order of the Expropriation Tribunal, [1984] T.E. 108. Appeal allowed, Lamer C.J. and Sopinka J. dissenting.
Viateur Bergeron, Q.C., for the appellant.
Guy Monette, Benoît Montgrain and Sylvie Gingras, for the respondent.
//Sopinka J.//
The reasons of Lamer C.J. and Sopinka J. were delivered by
Sopinka J. (dissenting) -- The issue raised in this appeal is whether, at the time of the expropriation proceedings brought by the respondent, the City of Longueuil, with respect to the immoveable property belonging to the appellant, Dame Jeanne D'Arc Lambert, the parties were bound by a transaction or agreement regarding the indemnity payable by the respondent upon expropriation. I have had the benefit of reading the reasons of my colleague L'Heureux-Dubé J. in this appeal and with respect, I am unable to agree with the conclusion she has reached. I agree that the conditions for the existence of a transaction within the meaning of art. 1918 C.C.L.C. are not satisfied on the facts of the case. I also agree that the parties did not expressly enter into an agreement as to the indemnity which was to be payable by the respondent upon expropriation. However, I am of the view that there remained throughout a valid and enforceable agreement for the sale of the property in question for the price of $500,000, and I would uphold the conclusion reached by the Court of Appeal that the Expropriation Tribunal was bound to take this into account in fixing the indemnity.
Facts and Proceedings
L'Heureux-Dubé J. has recited the facts and proceedings at length, and I propose to deal with them briefly, highlighting those aspects which I consider important for the resolution of the issue in the case.
In September 1974, a representative of the respondent commenced negotiations with the appellant with a view to purchasing the property in question. During these negotiations, the respondent was made aware of certain problems of title affecting the appellant's property. After several meetings, the appellant signed an offer for the sale of the property in favour of the City for a price of $500,000, dated January 30, 1975.
Paragraphs (c) and (f) of the offer of sale states as follows:
[translation] (c) If this offer is accepted by the said City, the notarial deed of sale giving effect hereto shall be executed and signed within six months of the date of such acceptance . . .
. . .
(f) All title deeds relating to the said immovable property shall be delivered by the vendor to the purchaser within ten (10) days of the date of acceptance of this offer by the said City. The legal advisers of the City shall have thirty (30) days from the date of delivery of the said title deeds to examine same. If defects in title are found, they shall be remedied by the vendor within fifteen (15) days of the date on which such disclosure is made to it, and in the event of its failing to do so, the purchaser may if it thinks fit, by means of notice to this effect which it shall send the vendor by registered mail, cancel and rescind its acceptance of this offer without any other formality or notice;
. . .
DURATION
This offer of sale must be accepted by August 1, 1975, at the latest, or it shall become ipso facto void without notice or putting in default.
On June 2, 1975, the respondent accepted the said offer by resolution of its Board.
On July 23, 1975, the appellant's lawyer wrote to the City indicating that it would be impossible, in light of the continuing litigation as to ownership of the property, for the appellant to provide clear title before the date of the expiry of the offer. The last paragraph of the letter offered a choice to the respondent:
[translation] The City of Longueuil must therefore discharge its responsibilities: either by obtaining this cancellation or by proceeding by expropriation. Our client can do nothing further.
On December 3, 1975, one day after the expiration of the six-month deadline provided for in paragraph (c) of the offer, the respondent served the notice of expropriation upon the appellant. Paragraph 8 of the notice explicitly states:
[translation] The object of the present proceeding by the expropriating party is to obtain possession of the premises and clear title as quickly as possible, and it is undertaken without prejudice to its rights and remedies resulting from any deed or agreement already concluded with the expropriated party . . .
The expropriation proceedings were then triggered and on January 13, 1976, upon application before the Quebec Superior Court, the City obtained "prior possession" of the property upon payment of $500,000. On February 14, 1977, the appellant filed a motion to withdraw the sum of $500,000. The litigation as to ownership of the property was settled by the appellant upon payment of $100,000 of the said $500,000 to the third party, Mibra Investment Corporation.
On August 1, 1977, the appellant brought a motion before the Quebec Superior Court to refer the case to the Expropriation Tribunal to fix the indemnity, and on September 26, 1977, the appellant filed a detailed claim for a total of $2,042,701.60 representing the value of the property at the time the respondent took possession. This claim was later increased to $3,175,000. On April 26, 1978, the respondent filed a specific offer of $500,000 as the indemnity to be set by the Expropriation Tribunal. On December 4, 1981, the respondent brought a motion before the Expropriation Tribunal for a declaration that there was a transaction between the parties as to the value of the land upon expropriation. This motion was dismissed without a hearing. The respondent then moved for the issuance of a writ of evocation by the Quebec Superior Court, upon which the parties agreed that the matter be referred to the Expropriation Tribunal for the resolution of all the issues, including the motion with respect to the declaration of a transaction.
Decision of Expropriation Tribunal, [1984] T.E. 108
Judge Dorion concluded on the facts of the case that there was no transaction within the meaning of art. 1918 C.C.L.C. On the other hand, Judge Dorion did not dispute the existence of an offer to sell the property in question for $500,000 which was duly accepted by the City by resolution (at p. 113):
[translation] It appears from the evidence that what the parties agreed on between themselves was, on the one hand, the purchase, and on the other, the sale of an immovable property for a price of $500,000, which was not to be paid until signature of a notarial contract. From the standpoint of law and precedent, therefore, the facts which occurred between the parties and were established in evidence support the conclusion that there was an offer of sale by the respondent, accepted by the applicant, the performance of which was subject to the requirement that a notarial contract would be drawn up at the time payment was to be made.
There is no doubt as to the existence of the offer of sale, the existence of its acceptance by the applicant is equally not in doubt and the fact that up to a certain point the applicant wished to give effect to it is also well established. [Emphasis added.]
However, while Judge Dorion did not challenge the existence of a valid offer of sale, he was of the view that the respondent had renounced its rights under the agreement when it commenced expropriation proceedings (at p. 114):
[translation] On December 3, 1975 the applicant served a notice of expropriation on the respondent. At that time it renounced the accepted offer of sale, or what it now claims was a transaction, and the effect of the position taken by it was to place the parties once again in the same position as before [the offer] was signed.
The Tribunal fixed the indemnity to be paid by the respondent to the appellant at $1,714,936 and ordered the payment of an additional indemnity calculated on the total award.
Superior Court (Vaillancourt J.)
The Superior Court homologated the decision of the Expropriation Tribunal as required by s. 68 of the Expropriation Act, R.S.Q., c. E-24.
Court of Appeal (1988), 30 Q.A.C. 168 (Jacques and Tourigny JJ.A. and Meyer J. (ad hoc))
In allowing the appeal, a unanimous Court of Appeal found there was a valid agreement which the Expropriation Tribunal was bound to take into account in fixing the indemnity. It held (at pp. 170-71):
[translation] Whether this is a transaction or a contract between the parties, an agreement was made between them as to the amount to be paid.
. . .
That leaves expropriation, as a remedy open to the City. Moreover, according to the evidence it was counsel for Mrs. Picotte [the appellant] who suggested this solution. While the City took the initiative of expropriation proceedings, it nonetheless stated in paragraph 8 of its notice that the purpose of the proceeding was to obtain possession of the immovable property as quickly as possible and that this proceeding "is undertaken without prejudice to its rights and remedies resulting from any deed or agreement already concluded with the expropriated party".
In such a context, does the notice of expropriation have the effect of completely overriding any agreement concluded between the parties? With respect for the contrary view, I do not think so. By alleging the existence of a binding agreement and by expropriating without prejudice to its rights, the City was simply exercising the only remedy available to it to give effect to the agreement, to rapidly take possession of the land required for the outdoor recreation area and to clarify the title.
I therefore conclude that, in these circumstances, the parties were agreed on the amount at issue and the Expropriation Tribunal should have taken this agreement and the special circumstances surrounding the title into account.
Analysis
In light of the above facts, I am of the view that the Expropriation Tribunal erred in law in concluding that the respondent renounced its rights under the agreement when it commenced the expropriation proceedings. In arriving at this result, I have considered the arguments put forth on behalf of the appellant to support the contention that the offer of sale had been terminated.
First, the appellant has suggested that the offer was no longer in force at the time of the notice of expropriation as the six-month deadline provided for in paragraph (c) of the offer had expired. In my view, this alone cannot be considered fatal to the survival to the agreement. As Lajoie J.A. wrote in Sosiak v. Marto Construction Inc., [1976] C.A. 286, at p. 289:
[translation] On this question of an accepted offer of purchase, the deadline stipulated for signature of the deed of sale as a rule is not in my view a strict one unless it is clearly indicated as being so, in cases where the parties have agreed that they would be released from their respective obligations solely by the passage of time if the deed was not signed.
In this case, it is significant that there was no express stipulation to the effect that the offer would become void if the six-month deadline was not met. The absence of such a provision is to be contrasted to the express stipulation that the offer would become "ipso facto" null and void if the offer were not accepted before August 1, 1975:
[translation] DURATION
This offer of sale must be accepted by August 1, 1975, at the latest, or it shall become ipso facto void without notice or putting in default.
The principle that the expiry of the date fixed for the signing of the deed of sale is not sufficient to render the offer null was confirmed once again by the Court of Appeal in its recent decision, Lipari v. Hébert, C.A. Montréal, No. 500-09-000414-888, February 19, 1991, at p. 2:
[translation] . . . the date set in the duly accepted offer of purchase as the date for signature of the deed of sale clearly cannot be regarded as in itself establishing a strict deadline unless this is expressly stated . . .
I conclude that the mere fact that the expropriation notice was sent on the day following the expiry of the six-month deadline is not sufficient to bring an otherwise valid agreement to an end.
Second, the appellant has argued that the respondent effectively renounced its rights under the offer as it did not attempt to enforce the agreement or put the appellant in default to execute the deed of sale before proceeding with the expropriation proceedings. The Expropriation Tribunal also considered this to be relevant in arriving at its conclusion (p. 114). On this point, I am in full agreement with the view expressed by Tourigny J.A. of the Court of Appeal who wrote (at p. 170):
[translation] With respect, I cannot follow the view of the Expropriation Tribunal which suggests that if, following the agreement, the city wished to rely on it, it had to do so by "appropriate judicial" action. It must be borne in mind that in the case at bar the action in execution of title was of no use, since there is no doubt that Mrs. Picotte's title deeds were not clear. [Emphasis added.]
With respect to the decision of the respondent to commence expropriation proceedings without first putting the appellant in default to execute the deed of sale, it is clear that a mise en demeure is not always a necessary precondition to the exercise of rights under an agreement. In Svatek v. Abony, [1986] R.D.I. 605, the Provincial Court held that it was not necessary for the plaintiff vendor of the immoveable property to put the defendant purchaser in default by means of a mise en demeure before instituting an action for damages based on the failure of the purchaser to proceed with the sale as agreed to in the offer of sale. In that case, the purchaser had clearly demonstrated that she was not intending to go through with the sale. The court stated (at p. 608):
[translation] The Tribunal is accordingly of the view that the plaintiff did not have to put the defendant-cross-plaintiff in default because of her actions, which left no doubt that she did not intend to sign the deed of sale in accordance with the duly accepted offer . . .
This principle of law, which is accepted by both the civil and common law, is based on the rule of common sense that the law does not require an act to be done which would serve no useful purpose. (See British and Beningtons, Ld. v. North Western Cachar Tea Co., [1923] A.C. 48 (H.L.), and MacKiw v. Rutherford, [1921] 2 W.W.R. 329 (Man. K.B.).)
Similarly in the present case, a mise en demeure would have been of no avail, given the knowledge of both parties of the pending litigation with respect to title. In fact, the appellant's lawyer had clearly indicated that the appellant would not be able to provide clear title.
Finally, the appellant has argued that the expropriation notice constituted a termination of the agreement as provided for in paragraph (f) of the offer of sale. Paragraph (f) is worth repeating:
[translation] (f) All title deeds relating to the said immovable property shall be delivered by the vendor to the purchaser within ten (10) days of the date of acceptance of this offer by the said City. The legal advisers of the City shall have thirty (30) days from the date of delivery of the said title deeds to examine same. If defects in title are found, they shall be remedied by the vendor within fifteen (15) days of the date on which such disclosure is made to it, and in the event of its failing to do so, the purchaser may if it thinks fit, by means of notice to this effect which it shall send the vendor by registered mail, cancel and rescind its acceptance of this offer without any other formality or notice. [Emphasis added.]
In my view, the expropriation notice by no means constitutes the notice of termination envisaged in paragraph (f) of the offer, which, it should be noted, is a stipulation in favour of the respondent. There is no mention in the notice of expropriation of the respondent's intention to withdraw its acceptance under the offer of sale. On the contrary, as has been noted above, the respondent expressly reserved its rights under any agreement which may exist between the parties.
In these circumstances, I am of the view that the agreement between the parties for the sale of the property for the price of $500,000 continued to remain on foot. In considering whether there has been tacit renunciation on the part of the respondent, it is important to keep in mind that this notion must be restrictively interpreted. The court should not be quick to conclude that a party has renounced its rights by virtue of a binding and enforceable agreement unless the circumstances are such that any other conclusion would be implausible. This was made clear by the Court of Appeal in Gingras v. Gagnon, [1972] C.A. 306, at pp. 311-12:
[translation] As we know, tacit renunciation may be inferred from certain acts performed by the creditor: those acts must be such as to necessarily imply an intent to renounce the hypothec. They must be so unequivocal that it is impossible to interpret them in any other manner than as being a renunciation. It should be noted that renunciation is not presumed and must always be narrowly interpreted. [Emphasis added.]
In this case, I am unable to conclude that the circumstances are such that it would be "impossible to interpret them in any other manner" than to find renunciation on the part of the respondent.
Having concluded that there existed throughout a binding agreement between the parties, I agree with the Court of Appeal that the Expropriation Tribunal should have taken this into account in fixing the indemnity. Indeed, this factor is crucial in determining value. Instead, the Tribunal concluded (at p. 115):
[translation] It is clear here that the amount of $500,000 is not a fair and adequate indemnity and that it was only because of the harassment of Mr. Paré and the incomprehensible consent by his counsel that Mrs. Picotte resigned herself to signing the offer of sale. Fortunately the city of Longueuil decided to proceed by expropriation, and by so doing the applicant renounced the conclusion of a notarial deed of sale, as specified in the offer . . .
This conclusion contains two errors. First, there was no renunciation. Second, I cannot agree that the price was reached as a result of harassment. Indeed, had the third party's claim against the appellant been successful, the value of the property to the appellant could very well have been less than the price which the respondent was willing to pay. Moreover, as has been noted above, it was only with the $500,000 received from the respondent that the appellant was able to reach a settlement with the third party. In any event, it was not shown that the alleged harassment rendered the agreement of sale null and void.
Given that there was no renunciation by the respondent, the Tribunal was bound to respect the agreement which had been entered into by the parties. The principle which is to guide the Expropriation Tribunal in fixing the indemnity is the value of the property to the party being expropriated. In Corporation municipale de la ville de St-Georges Ouest v. Comact Inc., [1980] C.A. 521, the Court of Appeal affirmed this principle (at p. 524):
[translation] For expropriation purposes it is the value of the expropriated part of the property that must be determined in order to fix the indemnity, on the basis of its best possible use.
Comact Inc., and the principle articulated therein, was followed again by the Court of Appeal in its recent decision, Anjou (Town) v. Krum (1990), 44 L.C.R. 266, 38 Q.A.C. 1. Proulx J.A. stated (at p. 269 L.C.R.):
[translation] The principle of "value to the expropriated party" means that we must take into account the loss or injury suffered by the expropriated party but that this loss should not be considered in addition to the potential advantage to the expropriating party of acquiring the property. Otherwise the expropriated party would benefit at the expense of the expropriating party.
The operation of this principle can be illustrated by reference to the expropriation of a property which is subject to an agreement of purchase and sale to which the expropriating authority is not a party. In these circumstances, the vendor's interest is limited to the purchase price. If the market value of the property exceeds the purchase price, the difference is the value of the purchaser's interest. If the purchaser is the expropriating authority itself, then it is entitled to the excess and the vendor has no claim to it. See, for example, Hillingdon Estates Co. v. Stonefield Estates Ld., [1952] Ch. 627, and Disposal Services Ltd. v. Municipality of Metropolitan Toronto (1973), 4 L.C.R. 242 (Ont. L.C.B.), at p. 250, aff'd (1973), 5 L.C.R. 91 (Ont. Div. Ct.).
Applying the principle to the facts of this case, the maximum value of the property to the appellant was the price of $500,000 stipulated in the agreement of sale by which the appellant was still bound when the property was expropriated. Since the respondent is the expropriating authority and purchaser, the excess market value of the property accrues to the respondent and not the appellant. Accordingly, I would dismiss the appeal and affirm the judgment of the Court of Appeal, with costs to the appellant.
//La Forest J.//
The following are the reasons delivered by
La Forest J. -- I have had the advantage of reading the reasons of my colleagues, L'Heureux‑Dubé J. and Sopinka J. With respect, I would dispose of the appeal in the manner proposed by L'Heureux‑Dubé J., and I agree fully with what she has to say regarding the alleged "transaction" and additional indemnity.
So far as the alleged agreement is concerned, I see no reason to depart from the Tribunal's view that Paré, who acted on behalf of the City, was persistent to the point of harassment in his dealings with the appellant, given its obvious advantage in weighing the evidence. Assuming there could nonetheless be said to have been an agreement of sale, the method by which the City carried out the expropriation procedures, to my mind, clearly indicates that it did not intend to rely upon the offer. I base this conclusion upon several factors: (1) the City chose not to execute the offer to sell within the six-month period, but filed a notice of expropriation the day after that period expired; (2) in the notice of expropriation, the City referred to the $500,000 as an expropriation offer, and made no reference to the offer to sell; (3) in its January 1976 motion to gain possession of the property, the City stated that it had offered $500,000 and that this offer had not been accepted by Lambert; (4) on August 1, 1977, Lambert filed a motion indicating her refusal to accept the $500,000 price and asking that the matter be referred to the Expropriation Tribunal to determine the proper indemnity, and this motion was not contested by the City; (5) the City claimed that there was a binding transaction for the first time more than five years after the notice of expropriation was given, and almost three years after it gave its initial declaration regarding the appropriate indemnity to the Tribunal.
Weighing against these factors is the presence of paragraph 8 in the notice of expropriation, stating that the purpose of the expropriation procedure was to obtain possession and title as rapidly as possible, and that the expropriation was without prejudice to the City's prior rights. This paragraph was virtually the only factor relied upon by the Court of Appeal in finding that there was an agreement. With respect, I think the Court of Appeal's opinion goes against the weight of the evidence and the factual findings of the Tribunal. A much more plausible interpretation of what happened, in my view, is that the City decided to insist on the $500,000 price after the Tribunal determined the value of four other parcels of land connected with the same project in April 1981, and awarded the owners substantial indemnities.
Citing Gingras v. Gagnon, [1972] C.A. 306, the respondent argues that the renunciation of a right should never be presumed, and must be interpreted narrowly. In that case, Turgeon J.A. states, at pp. 311-12:
[translation] They [the actions of the parties] must be so unequivocal that it is impossible to interpret them in any other manner than as being a renunciation. It should be noted that renunciation is not presumed and must always be narrowly interpreted.
Conceding this point, I nonetheless believe that the City's actions in this case have met that threshold, and I would accordingly conclude that it renounced its rights under the offer of sale.
//L'Heureux-Dubé//
The judgment of L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ. was delivered by
L'Heureux-Dubé J. -- This case concerns the expropriation by the respondent City of Longueuil (the "City") of an immoveable property belonging to the appellant, Dame Jeanne D'Arc Lambert, which the Expropriation Tribunal valued at $1,714,936 at the time the City took possession. The expropriation in question is governed by the Quebec Expropriation Act, R.S.Q., c. E-24 (the "Act").
The main issue in this appeal is whether, prior to the expropriation proceedings, the parties had entered into a binding transaction or agreement as to the indemnity ($500,000) to be paid by the City upon expro

Court headnote

Longueuil (City) v. Lambert-Picotte Collection Supreme Court Judgments Date 1991-06-27 Report [1991] 2 SCR 401 Case number 21151 Judges Lamer, Antonio; La Forest, Gérard V.; L'Heureux-Dubé, Claire; Sopinka, John; Gonthier, Charles Doherty; Cory, Peter deCarteret; McLachlin, Beverley On appeal from Quebec Subjects Expropriation Notes SCC Case Information: 21151 Decision Content Longueuil (City) v. Lambert‑Picotte, [1991] 2 S.C.R. 401 Dame Jeanne D'Arc Lambert Appellant v. City of Longueuil Respondent Indexed as: Longueuil (City) v. Lambert‑Picotte File No.: 21151. 1991: January 31; 1991: June 27. Present: Lamer C.J. and La Forest, L'Heureux‑Dubé, Sopinka, Gonthier, Cory and McLachlin JJ. on appeal from the court of appeal for quebec Expropriation ‑‑ Indemnity ‑‑ Whether a transaction or an agreement between parties as to indemnity in event of expropriation ‑‑ Whether Court of Appeal erred in intervening in Expropriation Tribunal's decision ‑‑ Expropriation Act, R.S.Q., c. E‑24, ss. 19, 68 ‑‑ Civil Code of Lower Canada, art. 1918. Expropriation ‑‑ Indemnity ‑‑ Additional indemnity ‑‑ Provisional indemnity less than one third of final indemnity ‑‑ Whether granting of additional indemnity justified ‑‑ Whether provisional indemnity should be taken into account in calculation of additional indemnity ‑‑ Expropriation Act, R.S.Q., c. E‑24, s. 68. In 1974, the City of Longueuil entered into negotiations with the appellant for the purchase of her land, to establish an outdoor recreation centre. After several meetings, the parties entered into an offer of sale setting the purchase price at $500,000. At this time, both parties were well aware that the appellant could not deliver clear title to the property because of an existing dispute between the appellant and another party. The City took no further action regarding the offer of sale. Rather, the City chose to file a notice of expropriation, one day after the expiration of the six-month deadline set out in the offer to execute the deed of sale. Paragraph 8 of the notice of expropriation indicated that expropriation was undertaken "without prejudice to its rights and remedies resulting from any deed or agreement already concluded with the expropriated party". On a motion before the Superior Court, the City was granted "prior possession" of the property. The motion stated that the City had offered an indemnity of $500,000 but that the appellant had not yet accepted it. The City put $500,000 on deposit and, a year later, the appellant's motion to withdraw the money was granted without prejudice to her right to claim a greater indemnity in the expropriation proceedings. When the case was finally remitted to the Expropriation Tribunal, the City contended that there had been a transaction between the parties with regard to the value of the land upon expropriation. The Tribunal rejected this argument, set the value of the land at $1,714,936, and ordered the City to pay the appellant with an additional indemnity calculated on the total award. The Tribunal's decision was homologated by the Superior Court. The Court of Appeal set aside the Tribunal's decision. It held that, whether it was a transaction or a contract between the parties, a binding agreement existed between the parties as to the indemnity upon expropriation. The present appeal is to determine whether, prior to the expropriation proceedings, the parties had entered into either a transaction or an agreement regarding the indemnity to be paid by the City on the expropriation of the land. A subsidiary issue concerns the discretion of the Expropriation Tribunal in awarding and calculating an additional indemnity on the total or defalcated award. Held (Lamer C.J. and Sopinka J. dissenting): The appeal should be allowed. (1) Whether there was a transaction or an agreement Per La Forest, L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ.: In order to reverse the conclusions of fact made by the Expropriation Tribunal, the Court of Appeal has to determine that the Tribunal had either grossly misconstrued the evidence so as to constitute an injustice, erred in law, or misapplied the law. The Expropriation Tribunal made no error in concluding that there was no transaction between the parties, because the requirements of art. 1918 C.C.L.C. were not met. At the time the offer was signed, there was no lawsuit, legal relationship, or contentious legal question between the parties which could be the subject of a transaction under art. 1918. In addition, there were no "concessions or reservations" made by either party to prevent future litigation over disputed rights. When the transaction allegedly occurred, the City had not yet passed a resolution, and therefore did not have the power, to expropriate the land. There was no evidence of a transaction in this case. Per L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ.: The Expropriation Tribunal correctly concluded that there was no agreement between the parties as to indemnity in the event of expropriation. The evidence does not support the existence of an oral agreement on the indemnity. The offer itself is silent and the testimony is inconclusive. Nothing in the written material filed in the record supports the City's contention that, prior or subsequent to the offer of sale, the parties even discussed, let alone agreed to, either the value of the land on expropriation or the indemnity to be paid in case of expropriation. Although a subsequent letter from the appellant's lawyer to the City's notary suggested the City could proceed by expropriation to obtain clear title, the letter did not allude to an agreement about the price to be paid. The caveat in paragraph 8 of the expropriation notice does not establish that there was an agreement regarding indemnity. There is no reference to an agreement, nor to the date, content or price of an indemnity. In its motion for prior possession, the City specifically admitted that there was no agreement, stating that the appellant had "not yet accepted" the City's offer. The City did not indicate its reliance on any agreement: the motion to allow the withdrawal of the $500,000 went uncontested, the motion to refer the matter to the Expropriation Tribunal to fix the indemnity was made on consent, and the City at no time protested the appellant's detailed claim for indemnity. Therefore, there was no agreement and the Court of Appeal erred in reversing the findings of the Expropriation Tribunal. Accordingly the appeal should be allowed. The Expropriation Tribunal's award as to the value of the expropriated land was not challenged and must stand. Per La Forest J.: Given its obvious advantage in weighing the evidence, there is no reason to depart from the Expropriation Tribunal's view that the representative of the City was persistent to the point of harassment in his dealings with the appellant. Assuming there could nonetheless be said to have been an agreement of sale, the method by which the City carried out the expropriation procedures clearly indicated that it did not intend to rely upon the offer of sale. The Court of Appeal's opinion that there was an agreement, which is based almost exclusively on paragraph 8 of the expropriation notice, goes against the weight of the evidence and the factual findings of the Tribunal. It is true that the renunciation of a right should never be presumed and must be interpreted narrowly. However, in this case, the City's actions have met that threshold and cannot be interpreted in any other manner than a renunciation of its rights under the offer of sale. Per Lamer C.J. and Sopinka J. (dissenting): While the conditions for the existence of a transaction were not met in this case and even though the parties did not expressly enter into an agreement as to indemnity, there remained throughout a valid and enforceable agreement for the sale of the property. A court should not conclude that a party has tacitly renounced its rights by virtue of a binding and enforceable agreement unless the circumstances are such that any other conclusion would be implausible. The notion of renunciation must be interpreted narrowly. Here, the Expropriation Tribunal erred in concluding that the City renounced its rights under the agreement when it commenced the expropriation proceedings. The mere fact that the expropriation notice was sent one day after the expiry of the six‑month deadline for signing the deed of sale was insufficient to render the offer null. Unless this is expressly stipulated, the time allowed for signing the deed of sale is not generally a strict time limit. There was no express stipulation to that effect in this case. Further, the City did not renounce its rights under the offer when it did not attempt to enforce the agreement before proceeding with the expropriation. A mise en demeure is not always a necessary precondition to the exercise of rights under an agreement. In this case, the mise en demeure would have served no useful purpose given the well‑known fact that the appellant could not provide clear title. Finally, the expropriation notice did not constitute the notice of termination envisaged in the offer of sale. There was no mention in the expropriation notice of the City's intention to withdraw its acceptance under the offer. On the contrary, the City expressly reserved its rights under any agreement which may exist between the parties. Given that there was no renunciation by the City, the Tribunal was bound to respect the agreement which had been entered into by the parties. It was not shown that the alleged harassment rendered the agreement null and void. The principle which is to guide the Tribunal in fixing the indemnity is the value of the property to the party being expropriated. Here, the maximum value of the property to the appellant was the price of $500,000 stipulated in the agreement of sale by which the appellant was still bound when the property was expropriated. (2) Additional Indemnity Per La Forest, L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ.: The decision to grant an additional indemnity is discretionary under s. 68 of the Expropriation Act. The additional indemnity is a measure of damages, not of interest. While there are no exhaustive criteria for allowing such an indemnity, the main criteria are whether there has been undue delay, negligence by the expropriating party in completing the hearings, or an insufficient offer bearing no reasonable relation to the indemnity fixed. The conduct of the expropriating party may also be relevant. In the present case, the Expropriation Tribunal found that the difference between the provisional indemnity and the final indemnity was so large that it justified awarding an additional indemnity. There is no reason to interfere with its conclusion that the City sought to obtain the property on payment of a "trifling indemnity" which was "clearly insufficient". Under s. 68, the Expropriation Tribunal also has discretion to deduct the provisional indemnity from the final indemnity in order to determine the amount of the additional indemnity. The Tribunal's interpretation of s. 68 was not agreed with on this issue. Since there are no exhaustive criteria, the discretion to make a deduction must be exercised with regard to the particular circumstances of each case. In this case, the parties have agreed that the provisional indemnity should be deducted in calculating the additional indemnity. The Tribunal's award should be reduced accordingly. Cases Cited By L'Heureux‑Dubé J. Referred to: D. Dupéré Inc. v. Procureur général du Québec, C.A. Québec, No. 200‑09‑000397‑74, September 1, 1977; Cité de Ste‑Foy v. Société Immobilière Enic Inc., [1967] S.C.R. 121; Bellerose v. Talbot, [1957] Que. Q.B. 637, aff'd [1958] S.C.R. 261; Isabelle v. Procureur général du Québec, [1953] Que. Q.B. 747n; Ministre des Transports du Québec v. Texaco Canada Ltée, J.E. 83‑389; Robitaille v. Cité de Québec, [1948] Que. K.B. 787; Amusement Realty Corp. v. Minister of Roads of Quebec, [1949] Que. K.B. 562n; Yves Germain Inc. v. Ministre de la Voirie du Québec, [1974] C.A. 184; Labbé v. Ministre des Transports du Québec, [1980] C.A. 518; Lemieux v. Ville de Granby, [1980] R.P. 285; Procureur général du Québec v. Marois, J.E. 83‑475; Société d'aménagement de l'Outaouais v. Dumouchel, [1984] C.A. 571; Immeubles P.J. Ltée v. Laval (Ville de), J.E. 85‑676; Sylvestre v. Procureur général du Québec, [1980] C.A. 508; Club athlétique Champlain Ltée v. Ministre de la Voirie du Québec, [1979] C.A. 161; Louis Donolo Inc. v. Ville de Laval, [1979] R.P. 17; Allard v. Ville de Québec, [1978] T.E. 463; Anjou (Town) v. Krum (1990), 44 L.C.R. 266, 38 Q.A.C. 1; Ville de Montréal v. Lerner, [1979] C.A. 152; Corporation de la ville de Princeville v. Houle, [1985] T.E. 186; Commission scolaire de la Jeune Lorette v. Fédération des Caisses populaires Desjardins de Québec, C.A. Québec, No. 200‑09‑000354‑834, August 28, 1985; Cemp Investments Ltd. v. Lakeshore School Board, [1985] C.A. 584; Travelers Insurance Co. of Canada v. Corriveau, [1982] 2 S.C.R. 866; Ville de Laval v. Entreprises Lagacé Inc., T.E., No. 34‑001811‑76M, January 16, 1986; Restaurants et Motels Châtelaine International Ltée v. Procureur général du Québec, [1980] C.A. 511. By La Forest J. Referred to: Gingras v. Gagnon, [1972] C.A. 306. By Sopinka J. (dissenting) Sosiak v. Marto Construction Inc., [1976] C.A. 286; Lipari v. Hébert, C.A. Montréal, No. 500‑09‑000414‑888, February 19, 1991; Svatek v. Abony, [1986] R.D.I. 605; British and Beningtons, Ltd. v. North Western Cachar Tea Co., [1923] A.C. 48; MacKiw v. Rutherford, [1921] 2 W.W.R. 329; Gingras v. Gagnon, [1972] C.A. 306; Corporation municipale de la ville de St‑Georges Ouest v. Comact Inc., [1980] C.A. 521; Anjou (Town) v. Krum (1990), 44 L.C.R. 266, 38 Q.A.C. 1; Hillingdon Estates Co. v. Stonefield Estates Ld., [1952] Ch. 627; Disposal Services Ltd. v. Municipality of Metropolitan Toronto (1973), 4 L.C.R. 242 (Ont. L.C.B.), aff'd (1973), 5 L.C.R. 91 (Ont. Div. Ct.). Statutes and Regulations Cited Civil Code of Lower Canada, arts. 1056c, 1918. Expropriation Act, R.S.Q., c. E‑24, ss. 19, 20, 32 [am. 1983, c. 21, s. 7], 53.11 [ad. idem, s. 12], 68 [am. idem, s. 18]. Authors Cited Dorion, Guy et Roger Savard. Loi commentée de l'expropriation du Québec. Québec: Presses de l'université Laval, 1979. Giroux, Lorne. "L'expropriation en droit québécois" (1980), 10 R.D.U.S. 629. Mignault, Pierre Basile. Le droit civil canadien, t. 8. Montréal: Wilson & Lafleur, 1909. APPEAL from a judgment of the Quebec Court of Appeal (1988), 30 Q.A.C. 168, 40 L.C.R. 182, which set aside an order of the Expropriation Tribunal, [1984] T.E. 108. Appeal allowed, Lamer C.J. and Sopinka J. dissenting. Viateur Bergeron, Q.C., for the appellant. Guy Monette, Benoît Montgrain and Sylvie Gingras, for the respondent. //Sopinka J.// The reasons of Lamer C.J. and Sopinka J. were delivered by Sopinka J. (dissenting) -- The issue raised in this appeal is whether, at the time of the expropriation proceedings brought by the respondent, the City of Longueuil, with respect to the immoveable property belonging to the appellant, Dame Jeanne D'Arc Lambert, the parties were bound by a transaction or agreement regarding the indemnity payable by the respondent upon expropriation. I have had the benefit of reading the reasons of my colleague L'Heureux-Dubé J. in this appeal and with respect, I am unable to agree with the conclusion she has reached. I agree that the conditions for the existence of a transaction within the meaning of art. 1918 C.C.L.C. are not satisfied on the facts of the case. I also agree that the parties did not expressly enter into an agreement as to the indemnity which was to be payable by the respondent upon expropriation. However, I am of the view that there remained throughout a valid and enforceable agreement for the sale of the property in question for the price of $500,000, and I would uphold the conclusion reached by the Court of Appeal that the Expropriation Tribunal was bound to take this into account in fixing the indemnity. Facts and Proceedings L'Heureux-Dubé J. has recited the facts and proceedings at length, and I propose to deal with them briefly, highlighting those aspects which I consider important for the resolution of the issue in the case. In September 1974, a representative of the respondent commenced negotiations with the appellant with a view to purchasing the property in question. During these negotiations, the respondent was made aware of certain problems of title affecting the appellant's property. After several meetings, the appellant signed an offer for the sale of the property in favour of the City for a price of $500,000, dated January 30, 1975. Paragraphs (c) and (f) of the offer of sale states as follows: [translation] (c) If this offer is accepted by the said City, the notarial deed of sale giving effect hereto shall be executed and signed within six months of the date of such acceptance . . . . . . (f) All title deeds relating to the said immovable property shall be delivered by the vendor to the purchaser within ten (10) days of the date of acceptance of this offer by the said City. The legal advisers of the City shall have thirty (30) days from the date of delivery of the said title deeds to examine same. If defects in title are found, they shall be remedied by the vendor within fifteen (15) days of the date on which such disclosure is made to it, and in the event of its failing to do so, the purchaser may if it thinks fit, by means of notice to this effect which it shall send the vendor by registered mail, cancel and rescind its acceptance of this offer without any other formality or notice; . . . DURATION This offer of sale must be accepted by August 1, 1975, at the latest, or it shall become ipso facto void without notice or putting in default. On June 2, 1975, the respondent accepted the said offer by resolution of its Board. On July 23, 1975, the appellant's lawyer wrote to the City indicating that it would be impossible, in light of the continuing litigation as to ownership of the property, for the appellant to provide clear title before the date of the expiry of the offer. The last paragraph of the letter offered a choice to the respondent: [translation] The City of Longueuil must therefore discharge its responsibilities: either by obtaining this cancellation or by proceeding by expropriation. Our client can do nothing further. On December 3, 1975, one day after the expiration of the six-month deadline provided for in paragraph (c) of the offer, the respondent served the notice of expropriation upon the appellant. Paragraph 8 of the notice explicitly states: [translation] The object of the present proceeding by the expropriating party is to obtain possession of the premises and clear title as quickly as possible, and it is undertaken without prejudice to its rights and remedies resulting from any deed or agreement already concluded with the expropriated party . . . The expropriation proceedings were then triggered and on January 13, 1976, upon application before the Quebec Superior Court, the City obtained "prior possession" of the property upon payment of $500,000. On February 14, 1977, the appellant filed a motion to withdraw the sum of $500,000. The litigation as to ownership of the property was settled by the appellant upon payment of $100,000 of the said $500,000 to the third party, Mibra Investment Corporation. On August 1, 1977, the appellant brought a motion before the Quebec Superior Court to refer the case to the Expropriation Tribunal to fix the indemnity, and on September 26, 1977, the appellant filed a detailed claim for a total of $2,042,701.60 representing the value of the property at the time the respondent took possession. This claim was later increased to $3,175,000. On April 26, 1978, the respondent filed a specific offer of $500,000 as the indemnity to be set by the Expropriation Tribunal. On December 4, 1981, the respondent brought a motion before the Expropriation Tribunal for a declaration that there was a transaction between the parties as to the value of the land upon expropriation. This motion was dismissed without a hearing. The respondent then moved for the issuance of a writ of evocation by the Quebec Superior Court, upon which the parties agreed that the matter be referred to the Expropriation Tribunal for the resolution of all the issues, including the motion with respect to the declaration of a transaction. Decision of Expropriation Tribunal, [1984] T.E. 108 Judge Dorion concluded on the facts of the case that there was no transaction within the meaning of art. 1918 C.C.L.C. On the other hand, Judge Dorion did not dispute the existence of an offer to sell the property in question for $500,000 which was duly accepted by the City by resolution (at p. 113): [translation] It appears from the evidence that what the parties agreed on between themselves was, on the one hand, the purchase, and on the other, the sale of an immovable property for a price of $500,000, which was not to be paid until signature of a notarial contract. From the standpoint of law and precedent, therefore, the facts which occurred between the parties and were established in evidence support the conclusion that there was an offer of sale by the respondent, accepted by the applicant, the performance of which was subject to the requirement that a notarial contract would be drawn up at the time payment was to be made. There is no doubt as to the existence of the offer of sale, the existence of its acceptance by the applicant is equally not in doubt and the fact that up to a certain point the applicant wished to give effect to it is also well established. [Emphasis added.] However, while Judge Dorion did not challenge the existence of a valid offer of sale, he was of the view that the respondent had renounced its rights under the agreement when it commenced expropriation proceedings (at p. 114): [translation] On December 3, 1975 the applicant served a notice of expropriation on the respondent. At that time it renounced the accepted offer of sale, or what it now claims was a transaction, and the effect of the position taken by it was to place the parties once again in the same position as before [the offer] was signed. The Tribunal fixed the indemnity to be paid by the respondent to the appellant at $1,714,936 and ordered the payment of an additional indemnity calculated on the total award. Superior Court (Vaillancourt J.) The Superior Court homologated the decision of the Expropriation Tribunal as required by s. 68 of the Expropriation Act, R.S.Q., c. E-24. Court of Appeal (1988), 30 Q.A.C. 168 (Jacques and Tourigny JJ.A. and Meyer J. (ad hoc)) In allowing the appeal, a unanimous Court of Appeal found there was a valid agreement which the Expropriation Tribunal was bound to take into account in fixing the indemnity. It held (at pp. 170-71): [translation] Whether this is a transaction or a contract between the parties, an agreement was made between them as to the amount to be paid. . . . That leaves expropriation, as a remedy open to the City. Moreover, according to the evidence it was counsel for Mrs. Picotte [the appellant] who suggested this solution. While the City took the initiative of expropriation proceedings, it nonetheless stated in paragraph 8 of its notice that the purpose of the proceeding was to obtain possession of the immovable property as quickly as possible and that this proceeding "is undertaken without prejudice to its rights and remedies resulting from any deed or agreement already concluded with the expropriated party". In such a context, does the notice of expropriation have the effect of completely overriding any agreement concluded between the parties? With respect for the contrary view, I do not think so. By alleging the existence of a binding agreement and by expropriating without prejudice to its rights, the City was simply exercising the only remedy available to it to give effect to the agreement, to rapidly take possession of the land required for the outdoor recreation area and to clarify the title. I therefore conclude that, in these circumstances, the parties were agreed on the amount at issue and the Expropriation Tribunal should have taken this agreement and the special circumstances surrounding the title into account. Analysis In light of the above facts, I am of the view that the Expropriation Tribunal erred in law in concluding that the respondent renounced its rights under the agreement when it commenced the expropriation proceedings. In arriving at this result, I have considered the arguments put forth on behalf of the appellant to support the contention that the offer of sale had been terminated. First, the appellant has suggested that the offer was no longer in force at the time of the notice of expropriation as the six-month deadline provided for in paragraph (c) of the offer had expired. In my view, this alone cannot be considered fatal to the survival to the agreement. As Lajoie J.A. wrote in Sosiak v. Marto Construction Inc., [1976] C.A. 286, at p. 289: [translation] On this question of an accepted offer of purchase, the deadline stipulated for signature of the deed of sale as a rule is not in my view a strict one unless it is clearly indicated as being so, in cases where the parties have agreed that they would be released from their respective obligations solely by the passage of time if the deed was not signed. In this case, it is significant that there was no express stipulation to the effect that the offer would become void if the six-month deadline was not met. The absence of such a provision is to be contrasted to the express stipulation that the offer would become "ipso facto" null and void if the offer were not accepted before August 1, 1975: [translation] DURATION This offer of sale must be accepted by August 1, 1975, at the latest, or it shall become ipso facto void without notice or putting in default. The principle that the expiry of the date fixed for the signing of the deed of sale is not sufficient to render the offer null was confirmed once again by the Court of Appeal in its recent decision, Lipari v. Hébert, C.A. Montréal, No. 500-09-000414-888, February 19, 1991, at p. 2: [translation] . . . the date set in the duly accepted offer of purchase as the date for signature of the deed of sale clearly cannot be regarded as in itself establishing a strict deadline unless this is expressly stated . . . I conclude that the mere fact that the expropriation notice was sent on the day following the expiry of the six-month deadline is not sufficient to bring an otherwise valid agreement to an end. Second, the appellant has argued that the respondent effectively renounced its rights under the offer as it did not attempt to enforce the agreement or put the appellant in default to execute the deed of sale before proceeding with the expropriation proceedings. The Expropriation Tribunal also considered this to be relevant in arriving at its conclusion (p. 114). On this point, I am in full agreement with the view expressed by Tourigny J.A. of the Court of Appeal who wrote (at p. 170): [translation] With respect, I cannot follow the view of the Expropriation Tribunal which suggests that if, following the agreement, the city wished to rely on it, it had to do so by "appropriate judicial" action. It must be borne in mind that in the case at bar the action in execution of title was of no use, since there is no doubt that Mrs. Picotte's title deeds were not clear. [Emphasis added.] With respect to the decision of the respondent to commence expropriation proceedings without first putting the appellant in default to execute the deed of sale, it is clear that a mise en demeure is not always a necessary precondition to the exercise of rights under an agreement. In Svatek v. Abony, [1986] R.D.I. 605, the Provincial Court held that it was not necessary for the plaintiff vendor of the immoveable property to put the defendant purchaser in default by means of a mise en demeure before instituting an action for damages based on the failure of the purchaser to proceed with the sale as agreed to in the offer of sale. In that case, the purchaser had clearly demonstrated that she was not intending to go through with the sale. The court stated (at p. 608): [translation] The Tribunal is accordingly of the view that the plaintiff did not have to put the defendant-cross-plaintiff in default because of her actions, which left no doubt that she did not intend to sign the deed of sale in accordance with the duly accepted offer . . . This principle of law, which is accepted by both the civil and common law, is based on the rule of common sense that the law does not require an act to be done which would serve no useful purpose. (See British and Beningtons, Ld. v. North Western Cachar Tea Co., [1923] A.C. 48 (H.L.), and MacKiw v. Rutherford, [1921] 2 W.W.R. 329 (Man. K.B.).) Similarly in the present case, a mise en demeure would have been of no avail, given the knowledge of both parties of the pending litigation with respect to title. In fact, the appellant's lawyer had clearly indicated that the appellant would not be able to provide clear title. Finally, the appellant has argued that the expropriation notice constituted a termination of the agreement as provided for in paragraph (f) of the offer of sale. Paragraph (f) is worth repeating: [translation] (f) All title deeds relating to the said immovable property shall be delivered by the vendor to the purchaser within ten (10) days of the date of acceptance of this offer by the said City. The legal advisers of the City shall have thirty (30) days from the date of delivery of the said title deeds to examine same. If defects in title are found, they shall be remedied by the vendor within fifteen (15) days of the date on which such disclosure is made to it, and in the event of its failing to do so, the purchaser may if it thinks fit, by means of notice to this effect which it shall send the vendor by registered mail, cancel and rescind its acceptance of this offer without any other formality or notice. [Emphasis added.] In my view, the expropriation notice by no means constitutes the notice of termination envisaged in paragraph (f) of the offer, which, it should be noted, is a stipulation in favour of the respondent. There is no mention in the notice of expropriation of the respondent's intention to withdraw its acceptance under the offer of sale. On the contrary, as has been noted above, the respondent expressly reserved its rights under any agreement which may exist between the parties. In these circumstances, I am of the view that the agreement between the parties for the sale of the property for the price of $500,000 continued to remain on foot. In considering whether there has been tacit renunciation on the part of the respondent, it is important to keep in mind that this notion must be restrictively interpreted. The court should not be quick to conclude that a party has renounced its rights by virtue of a binding and enforceable agreement unless the circumstances are such that any other conclusion would be implausible. This was made clear by the Court of Appeal in Gingras v. Gagnon, [1972] C.A. 306, at pp. 311-12: [translation] As we know, tacit renunciation may be inferred from certain acts performed by the creditor: those acts must be such as to necessarily imply an intent to renounce the hypothec. They must be so unequivocal that it is impossible to interpret them in any other manner than as being a renunciation. It should be noted that renunciation is not presumed and must always be narrowly interpreted. [Emphasis added.] In this case, I am unable to conclude that the circumstances are such that it would be "impossible to interpret them in any other manner" than to find renunciation on the part of the respondent. Having concluded that there existed throughout a binding agreement between the parties, I agree with the Court of Appeal that the Expropriation Tribunal should have taken this into account in fixing the indemnity. Indeed, this factor is crucial in determining value. Instead, the Tribunal concluded (at p. 115): [translation] It is clear here that the amount of $500,000 is not a fair and adequate indemnity and that it was only because of the harassment of Mr. Paré and the incomprehensible consent by his counsel that Mrs. Picotte resigned herself to signing the offer of sale. Fortunately the city of Longueuil decided to proceed by expropriation, and by so doing the applicant renounced the conclusion of a notarial deed of sale, as specified in the offer . . . This conclusion contains two errors. First, there was no renunciation. Second, I cannot agree that the price was reached as a result of harassment. Indeed, had the third party's claim against the appellant been successful, the value of the property to the appellant could very well have been less than the price which the respondent was willing to pay. Moreover, as has been noted above, it was only with the $500,000 received from the respondent that the appellant was able to reach a settlement with the third party. In any event, it was not shown that the alleged harassment rendered the agreement of sale null and void. Given that there was no renunciation by the respondent, the Tribunal was bound to respect the agreement which had been entered into by the parties. The principle which is to guide the Expropriation Tribunal in fixing the indemnity is the value of the property to the party being expropriated. In Corporation municipale de la ville de St-Georges Ouest v. Comact Inc., [1980] C.A. 521, the Court of Appeal affirmed this principle (at p. 524): [translation] For expropriation purposes it is the value of the expropriated part of the property that must be determined in order to fix the indemnity, on the basis of its best possible use. Comact Inc., and the principle articulated therein, was followed again by the Court of Appeal in its recent decision, Anjou (Town) v. Krum (1990), 44 L.C.R. 266, 38 Q.A.C. 1. Proulx J.A. stated (at p. 269 L.C.R.): [translation] The principle of "value to the expropriated party" means that we must take into account the loss or injury suffered by the expropriated party but that this loss should not be considered in addition to the potential advantage to the expropriating party of acquiring the property. Otherwise the expropriated party would benefit at the expense of the expropriating party. The operation of this principle can be illustrated by reference to the expropriation of a property which is subject to an agreement of purchase and sale to which the expropriating authority is not a party. In these circumstances, the vendor's interest is limited to the purchase price. If the market value of the property exceeds the purchase price, the difference is the value of the purchaser's interest. If the purchaser is the expropriating authority itself, then it is entitled to the excess and the vendor has no claim to it. See, for example, Hillingdon Estates Co. v. Stonefield Estates Ld., [1952] Ch. 627, and Disposal Services Ltd. v. Municipality of Metropolitan Toronto (1973), 4 L.C.R. 242 (Ont. L.C.B.), at p. 250, aff'd (1973), 5 L.C.R. 91 (Ont. Div. Ct.). Applying the principle to the facts of this case, the maximum value of the property to the appellant was the price of $500,000 stipulated in the agreement of sale by which the appellant was still bound when the property was expropriated. Since the respondent is the expropriating authority and purchaser, the excess market value of the property accrues to the respondent and not the appellant. Accordingly, I would dismiss the appeal and affirm the judgment of the Court of Appeal, with costs to the appellant. //La Forest J.// The following are the reasons delivered by La Forest J. -- I have had the advantage of reading the reasons of my colleagues, L'Heureux‑Dubé J. and Sopinka J. With respect, I would dispose of the appeal in the manner proposed by L'Heureux‑Dubé J., and I agree fully with what she has to say regarding the alleged "transaction" and additional indemnity. So far as the alleged agreement is concerned, I see no reason to depart from the Tribunal's view that Paré, who acted on behalf of the City, was persistent to the point of harassment in his dealings with the appellant, given its obvious advantage in weighing the evidence. Assuming there could nonetheless be said to have been an agreement of sale, the method by which the City carried out the expropriation procedures, to my mind, clearly indicates that it did not intend to rely upon the offer. I base this conclusion upon several factors: (1) the City chose not to execute the offer to sell within the six-month period, but filed a notice of expropriation the day after that period expired; (2) in the notice of expropriation, the City referred to the $500,000 as an expropriation offer, and made no reference to the offer to sell; (3) in its January 1976 motion to gain possession of the property, the City stated that it had offered $500,000 and that this offer had not been accepted by Lambert; (4) on August 1, 1977, Lambert filed a motion indicating her refusal to accept the $500,000 price and asking that the matter be referred to the Expropriation Tribunal to determine the proper indemnity, and this motion was not contested by the City; (5) the City claimed that there was a binding transaction for the first time more than five years after the notice of expropriation was given, and almost three years after it gave its initial declaration regarding the appropriate indemnity to the Tribunal. Weighing against these factors is the presence of paragraph 8 in the notice of expropriation, stating that the purpose of the expropriation procedure was to obtain possession and title as rapidly as possible, and that the expropriation was without prejudice to the City's prior rights. This paragraph was virtually the only factor relied upon by the Court of Appeal in finding that there was an agreement. With respect, I think the Court of Appeal's opinion goes against the weight of the evidence and the factual findings of the Tribunal. A much more plausible interpretation of what happened, in my view, is that the City decided to insist on the $500,000 price after the Tribunal determined the value of four other parcels of land connected with the same project in April 1981, and awarded the owners substantial indemnities. Citing Gingras v. Gagnon, [1972] C.A. 306, the respondent argues that the renunciation of a right should never be presumed, and must be interpreted narrowly. In that case, Turgeon J.A. states, at pp. 311-12: [translation] They [the actions of the parties] must be so unequivocal that it is impossible to interpret them in any other manner than as being a renunciation. It should be noted that renunciation is not presumed and must always be narrowly interpreted. Conceding this point, I nonetheless believe that the City's actions in this case have met that threshold, and I would accordingly conclude that it renounced its rights under the offer of sale. //L'Heureux-Dubé// The judgment of L'Heureux-Dubé, Gonthier, Cory and McLachlin JJ. was delivered by L'Heureux-Dubé J. -- This case concerns the expropriation by the respondent City of Longueuil (the "City") of an immoveable property belonging to the appellant, Dame Jeanne D'Arc Lambert, which the Expropriation Tribunal valued at $1,714,936 at the time the City took possession. The expropriation in question is governed by the Quebec Expropriation Act, R.S.Q., c. E-24 (the "Act"). The main issue in this appeal is whether, prior to the expropriation proceedings, the parties had entered into a binding transaction or agreement as to the indemnity ($500,000) to be paid by the City upon expro

Longueuil (City) v. Lambert-Picotte

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Longueuil (City) v. Lambert-Picotte

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