After years-long battle, B.C.'s highest court rules city was within its rights to pause condo project

A developer trying to build a 12-storey condo tower in White Rock, B.C., has lost a years-long court battle against the city after taking the case all the way to the province's highest court.

GSR Capital Group appealed a B.C. Supreme Court decision which found the incoming city council was justified in putting the Lady Alexandra project on hold after the election in 2018. 

In a decision published online Friday, the B.C. Court of Appeal found the city was within its rights to pause the project.

"I am not persuaded that White Rock's interpretation of its powers ... was unreasonable," wrote Justice Harvey Groberman.

The decision, coincidentally arriving in a municipal election year, sets a precedent for future councils looking to change direction in the middle of a building's development process.

It's also a victory for the city's mayor in a fight that's lasted virtually his entire term.

"I'm delighted that it's over," White Rock Mayor Darryl Walker said by phone on Friday.

One council approved, the next one didn't

At one point, the development at 1310 Johnston St. was moving forward with a green light from the city.

GSR got a development permit from the previous council in July 2018, after spending years planning the project. The developer was set to launch its pre-sale the following spring, then apply for the building permit — the final stage of approval before construction starts.

But three months later, voters elected a new White Rock city council on a platform of slowing growth in the city and preserving low density buildings. 

The new council changed the zoning in the Lower Town Centre area during its first week in office. Building heights were limited to six storeys.

"We did what we believed we had to do, and what we had the right to do under the community charter, to try and protect our community and maintain some of the levels within the community in regards to building heights," Mayor Walker said Friday, reflecting on the rezoning decision.

GSR's building permit was later denied. For the project to move forward, the developer would need to completely redesign the tower and start the development process over again.

The developer took the city to B.C. Supreme Court in 2019, accusing council of acting unfairly and without the proper authority. It argued the development permit issued by the previous council should've been binding, forcing the new council to preserve the old zoning for two years.

The developer lost the case in March 2020, then lost again Friday after taking it to the B.C. Court of Appeal.

In the decision, justice Harvey M. Groberman found the Local Government Act does not bind the city to an old development permit. He also said the city wasn't unreasonable to describe the project as a "proposed development" when the developer applied for a building permit.

"It is true that the City had issued a development permit, and that, in that sense, the proposed development had moved beyond its earliest stages," Groberman wrote.

"It seems to me, however, reasonable to describe the project as a 'proposed development.' Construction had yet to commence, and there was no assurance that it ever would. It is true that G.S.R. was bound by the terms of the development permit, but those terms did not compel it to go ahead with the project."

An emailed statement from the company said it was "shell-shocked" by the decision.

"Just because it was determined 'reasonable' in the Court's eyes, doesn't mean it was right. Is this really the kind of system that B.C. intended to govern development across the province and relations between municipalities and developers, and others indirectly?" the statement read.

"We need to step back and realize how a government being able to take this sort of action violates our trust in the system."

Mayor Walker said Friday he and council are open to working with the developer to find a compromise for the land. 

"We had hoped all along that there would be some sort of resolution where the two sides could come together and find some common ground," he said. 

"The ball is now in the hands of the proponents to decide what they want to do," he added. "It's their property. It's their land. They're the ones who have to make a decision as to what they want to do with it ... but also, are allowed to have a set of rules that give those broader guidelines as to what is possible."