Private Property Rights in Canada
Charter of Rights and Freedoms (1982)
(applies to both federal and provincial governments):
- Section 7 states: "Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice."
- The Canadian Constitution does not provide a framework for strong private property rights. The omission of "property" and "due process" was a deliberate departure from the constitutional texts on which the section had been modelled.
- The Supreme Court of Canada will not interpret "liberty" to include economic liberty. The reasons for this can be found in the experience of the United States between 1905 (when the Lochner v. New York case was decided) and 1937 (when the case was overruled). During this 22 year period the U.S. Supreme Court relied on Constitutional provision for "property" and "liberty" to protect owners of factories and mines against the legislature. Using broad interpretive powers, they were able to prevent government from passing laws that limited the hours of work, mandated minimum wages, imposed health and safety standards, and protected unions. Thus, the legislative pursuit of welfare state policies was prevented by Courts enforcing a laissez-faire economic agenda. Since the case was overruled in 1937, U.S. Courts have been reluctant to review social and economic regulations despite Constitutional guarantees for property and contract rights.
- By omitting property and any guarantee of the obligation of contracts from Section 7, and by replacing "due process" with "fundamental justice" the government intended to restrict the broad interpretive powers of judges. However, "the principles of fundamental justice" had no meaning in Anglo-Canadian law. The intent of the Constitutional framers was to create an equivalent to "natural law," which provides procedural rules: a hearing, unbiased adjudication, and a fair procedure. However, the Courts have taken a broader interpretation of the term. Rather than restricting their powers, it has ushered in a period of extraordinary judicial activism.
- An example of judicial activism could be found in the interpretation of "security of the person." This could refer to the economic capacity to satisfy basic human needs. Thus state action that prevents a person from producing an income would violate this provision. This could include confiscation of property essential to a person's work or cancellation of a licence essential to the pursuit of an occupation. However, the Courts could also interpret it to mean the removal from welfare programs. If an economic role was restored to Section 7 it would trigger a massive judicial review of the welfare state apparatus, the level of public expenditures on social programs, and the regulation of trades and businesses.
- Section 7 reference to "liberty" and "security of the person" must be interpreted to exclude property and to exclude freedom of contract, in short, to exclude economic liberty. Thus, Section 7 does not recognize rights of corporations, it does not recognize the right to do business, and it does not recognize the right of an individual to work.
- The omission of property rights greatly reduces the scope of Section 7. There is no guarantee of compensation for property taken by government. There is no guarantee of fair procedure. There is no guarantee of fair treatment by the Courts.
- Most federal powers can authorize the expropriation of property: for example, to exercise power over the national capital Parliament could expropriate property for a greenbelt. The federal power of expropriation is confined to the taking of property for purposes within its legislative authority.
- The provinces have been granted power over Section 92(13) "property and civil rights in the province." The architects of the Constitution Act understood the phrase "property and civil rights in the province" as a description of the body of private law that governs the relationships between subject and subject, not government and subject. Nonetheless, the provinces have a general power to expropriate property, which is confined by those areas that fall outside provincial jurisdiction.
- Generally speaking, Parliament can expropriate provincial Crown property, however, provincial legislative power will not extend to federal Crown property.
- In Anglo-Canadian law a statute that takes private property implicitly requires compensation to be paid to the private owner. However, if the statute expressly states that no compensation is payable, then there is no room for interpretation. In the case where a statute is a regulatory restriction of private property, a "regulatory taking," no compensation is payable.
- Neither the federal nor a provincial government is under any constitutional obligation to pay fair (or any) compensation for expropriated property. Neither the Constitution Act 1867 nor the Charter of Rights contains any such guarantee. As a result, legislative power is unlimited.
Canadian Bill of Rights (1960) (applies only to the federal government):
- Section 1(a) recognizes "the right of the individual to life, liberty, security of the person and enjoyment of property, and the right not to be deprived thereof except by due process of law."
- In the event that property is expropriated there are no provisions for "public use" or requirements for "just compensation."
- The Bill of Rights recognizes a fundamental right to the enjoyment of property. It is guaranteed by "due process" which is held to be a guarantee of a fair procedure.
- It has been argued that this clause is sufficiently similar to the Fifth Amendment in the U.S. Constitution as to be interpreted to confer a right to compensation. The Courts considered this and rejected the notion as being beyond the provisions of due process.
Canadian Human Rights Act (1980):
- No mention of property rights.
Alberta Expropriation Act
When government expropriates land in Alberta they are obligated to pay compensation to the landowner as outlined in section 42 of the Expropriation Act which states the principles of compensation: “When land is expropriated, the expropriating authority shall pay the owner the compensation as is determined in accordance with this Act” and the amount payable must be based on:
- the market value of the land,
- damages attributable to disturbance,
- the value to the owner of any special economic advantage, and
- damages for injurious affection
Disputes over the amount of compensation are referred to a
hearing before the Land Compensation Board.
More on the Land Compensation Board can be found at this website: http://www.surfacerights.gov.ab.ca/lcb
Alberta Surface Rights Act
The Alberta Surface Rights Act mediates disputes between oil and gas operators and private property owners or leaseholders. If the two parties fail to come to an agreement regarding entry or compensation Section 12 of the Surface Rights Act allows the Surface Rights Board to grant right of entry and Section 25 allows it to determine the appropriate compensation.
Factors to be considered for compensation include:
- Land Value
- General Disturbance
- Loss of Use
- Adverse Effect
- Entry Fee
- Pattern of dealings in area of the taking
More on the Surface Rights Board can be found at this website: http://www.surfacerights.gov.ab.ca/srb
Provincial Bills of Rights & Human Rights Acts:
British Columbia Human Rights Act (1984):
No mention of property rights.
Alberta Bill of Rights Act (1980):
Section 1(a) states: "It is hereby recognized and declared that in Alberta there exist without discrimination by reason of race, national origin, colour, religion or sex, the following human rights and fundamental freedoms, namely: the right of the individual to liberty, security of the person and enjoyment of property, and the right not to be deprived thereof except by due process of law."
In the event that property is expropriated there are no provisions for "public use" or requirements for "just compensation."
These provisions extend only to legislation over which Alberta has exclusive authority. Laws can be passed that override these provisions, however, with explicit declaration by the Alberta legislature.
Alberta Personal Property Bill of Rights Act (1998)
Section 2 states: where (a) personal property is owned by a person other than the Crown, and (b) a provincial enactment contains provisions that authorize the acquiring of permanent title to that personal property by the Crown, those provisions are of no force or effect unless a process is in place for the determination and payment of compensation for the acquiring of that title.”
This compensation provision only applies to “personal property” which, by legal definition, is property that is tangible and moveable, such as firearms. It does not apply to land, intellectual property or entitlements, and there are numerous exceptions to the law outlined in the act.
As a provincial statute, these provisions extend only to legislation over which Alberta has exclusive authority. Laws can be passed that override these provisions with explicit declaration by the Alberta legislature.
Alberta Human Rights, Citizenship and Multiculturalism Act (1996):
No mention of property rights.
Saskatchewan Bill of Rights Act (1947):
Section 10 states: "Every person and every class of persons shall enjoy the right to acquire by purchase, to own in fee simple or otherwise, to lease, rent and to occupy any lands, messuages, tenements or hereditaments, corporeal or incorporeal, of every nature and description, and every estate or interest therein, whether legal or equitable, without discrimination because of the race, creed, religion, colour or ethnic or national origin of such person or class of persons."
There is no mention of the right not to be deprived of property, nor any provisions for due process, public use, or just compensation.
Saskatchewan Human Rights Code (1979):
No mention of property rights.
Manitoba Human Rights Act (1975):
No mention of property rights.
Ontario Human Rights Code (1981):
No mention of property rights.
Quebec Charte des Droits et Libertés de la Personne (Bill of Human Rights) (1975) C. 6, a. 6 states:
"Toute personne a droit à la jouissance paisible et à la libre disposition de ses biens, sauf dans la mesure prévue par la loi." Translated to English : "A person has a right of peaceful enjoyment of his or her property and the right not to be deprived thereof except by due process of law."
There is no mention of the right not to be deprived of property, nor any provisions for due process, public use, or just compensation. An explanatory note affirms that the fundamental rights and liberties of a person are guaranteed by the will of the collective.
Quebec Charter of Human Rights and Freedoms:
No mention of property rights.
Newfoundland Human Rights Code (1970):
No mention of property rights.
Nova Scotia Human Rights Act (1969):
Section 3(b) states: "Every individual and every class of individuals has the right…to acquire and hold any interest in property….regardless of the race, religion, creed, colour or ethnic or national origin of the individual or class of individuals."
There is no mention of the right not to be deprived of property, nor any provisions for due process, public use, or just compensation.
New Brunswick Human Rights Act (1973):
Section 4(3) states: "No person shall impose, enforce or endeavor to impose or enforce, any term or condition on any conveyance, instrument or contract, whether written or oral, that restricts the right of any person or class of person with respect to property because of race, colour, religion, national origin, ancestry, place of origin or sex."
There is no mention of the right not to be deprived of property, nor any provisions for due process, public use, or just compensation.
Prince Edward Island Human Rights Act (1977):
No mention of property rights.
Northwest Territories Fair Practices Ordinance (1974):
No mention of property rights.
Yukon Territory Fair Practices Ordinance (1971):
No mention of property rights.
This summary originally compiled by Danielle Smith for the Canadian Property Rights Research Institute.
1 Nancie G. and Roger J. Marzulla, Property Rights: Understanding Takings and Environmental Regulation (Rockland, MD: Government Institutes, Inc., 1997).2 Peter W. Hogg, Constitutional Law of Canada (Third Edition) (Scarborough, Ontario: Carswell Thomson Professional Publishers, 1992.)
3 Translation provided by Maryse Martin, Economics student, Concordia University, Quebec.
4 Ibid.
Private Property Rights in the United States
The U.S. Constitution (applies to both federal and state governments):
- The Fifth Amendment states that no person shall "be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use without just compensation."
- The Fourteenth Amendment states that no "State shall deprive any person of life, liberty, or property without due process of law."
- The Contracts Clause of the Constitution also protects property by forbidding any state from passing laws "impairing the Obligation of Contracts."
- The United States Constitution emphasizes strong private property rights since the right to own and use property has always been recognized as essential to the maintenance of a free society.
- "Eminent domain" is the government's power to acquire private property through condemnation, regardless of the owner's objections. The power of eminent domain ensures that, in a framework where property rights are paramount, the federal and state governments maintain the power to acquire land in order to carry out their ordinary functions including construction of buildings, highways, or parks.
- The Fifth Amendment restricts the power of eminent domain by ensuring that the expropriated land is taken for "public use," as opposed to, for instance, the private benefit of some government official. It also ensures that the owner is paid "just compensation."
- "Just compensation" refers to the monetary value of the property taken and is typically determined on the basis of testimony from owners, appraisers, or both. The price a willing buyer would pay to a willing seller for the property constitutes "fair market value."
- If a government physically invades or occupies an expanse of property for a length of time, this constitutes a "taking," which must be dealt with under Fifth Amendment provisions for "public use" and "just compensation."
- A "regulatory taking" occurs if the government goes too far in restricting the use of property. If a regulation does not advance state interests and if it denies an owner economically viable use of his property then the Fifth Amendment "public use" and "just compensation" provisions likewise may apply.