By-Law - Spring 2012 - Reynolds Mirth Richards & Farmer LLP

Libelous Tweets: Defamation in the Internet Age..................P 1
Off-Site Levies: The Okotoks Decision..................................P 2
The CRTC and Municipal Access Agreements.......................P 3
Bonded Construction Projects: Obtain Delivery of Executed
Bonds Prior to Construction Commencing............................P 3
By-Law
The New Wills and Succession Act.......................................P 4
Spring 2012
Libelous Tweets: Defamation in the Internet Age
By Matthew Woodley
Social media and the interactive internet have
succeeded in giving every person with a computer
the ability to express their thoughts and opinions to
the world at large. In some cases, people will post
their thoughts on websites identified with them
specifically such as a Facebook account, a personal
blog or a Twitter account. In other cases, people will
utilize an internet “handle” which anonomizes their
identity on blogs or an online chat room. The freedom
of the internet, and the fact that there are so many
people using it, often leads people to believe that the
traditional laws of defamation do not apply online.
This is not the case.
While the law of defamation was developed in an
age of newspapers and pamphlets, courts have
been working over the past few years to apply those
principles to the online environment. In some cases,
the application is relatively straightforward. If a
person defames another on their Facebook page, the
injured party can start a lawsuit against that person.
However, where people make efforts to anonomize
their identity online, commencing a lawsuit can be
significantly more difficult. Courts have permitted
injured parties to seek information which would
identify a person with a specific Internet Protocol (or
“IP”) address. These methods can successfully result
in identifying the computer from which a defamatory
post arose, although proving who was using the
computer can be more difficult.
For Canadians, gathering the information necessary to
commence a lawsuit can be foiled if the website upon
which the defamatory comments appeared is based
in the United States. Different legal considerations
apply there, and courts may be less willing to disclose
such information.
These issues are particularly relevant for government
officials, municipal employees and councillors.
Decisions made by municipal governments may be
unpopular, and ratepayers are increasingly turning to
the internet to air their grievances. When these posts
come to the attention of the municipality, a decision
must be made about whether to respond to it, and
how. For example, where an employee is defamed
on the internet, the municipality may wish to take
some action to eliminate the defamatory comment or
try to prevent similar comments in the future. Many
websites which host blogs or chat rooms will respond
to requests made to remove an offensive post. Some
others might not only refuse to remove an offensive
post, they may simply not respond to a request.
When a municipal councillor is defamed online, the
municipality may wish to consider whether separate
legal representation is required.
The law generally recognizes that politicians are
often dealing with matters of public interest, and so
their decisions may be subject to a greater degree of
scrutiny than others. Comments which appear at first
blush to be defamatory may be defensible as a fair
comment or may be subject to a privilege.
When defamatory posts come to the attention of a
municipality, the first and most important step is to
capture the online information. Even though material
on the internet may never truly go away, individuals
who post defamatory comments may be able to
remove them. Therefore, copies of the defamatory
comments should be made by printing them out or
saving them as a portable document format (pdf) file.
While the internet is not a zone free from the reach
of defamation law, it presents unique challenges
for individuals who are defamed on it. Serious
consequences can follow a quick, heat-of-themoment
post, and anonymous posts may not be truly
anonymous.
1

Off-Site Levies: The Okotoks Decision
By William W. Barclay
In November of 2011, the Alberta Court of Appeal released a significant decision related to off-site levies, and other forms of charges which are similar
to off-site levies.
In this case, the Municipality had passed an off-site levy bylaw, and, by resolution, had also adopted a “Contribution Agreement”. The Contribution
Agreement purported to provide for voluntary payments by a developer, for off-site charges which were clearly outside of the types of levies that could
be imposed pursuant to section 648 of the MGA. A developer challenged both the off-site levy bylaw, and the resolution adopting the Contribution
Agreement, taking the position that the Municipality did not have the authority to pass either. In the result there were two main issues in this appeal.
The first dealt with whether or not an off-site levy was properly calculated in accordance with the “Principles and Criteria for Off-Site Levies Regulation”
(The Regulation). The second issue related to whether or not the Municipality could impose charges akin to off-site levies, by way of agreement with a
developer, even though the charges did not come within the definition of an off-site levy. This latter issue depended upon the scope of the Municipality’s
natural person powers, and whether or not they could be utilized to impose charges which were contrary to section 648 of the Municipal Government
Act (“the MGA”).
Section 648 of the MGA provides that a Municipal Council may pass a bylaw related to off-site levies. However, the section limits the type of levies
that may be imposed. Off-site levies may only be imposed if they pay for the capital cost of new or expanded facilities which relate to water, sewage,
drainage or roads, or land required for any of those facilities. Further, the Regulation governs the process which must be followed when establishing an
off-site levy. Developers must be consulted, and there must be full and open disclosure of all levy costs and payments. There is a shared responsibility
as between the municipality and developers for addressing future infrastructure requirements, and all beneficiaries are to participate in the cost of
providing for that infrastructure on an equitable basis having regard to the degree of benefit obtained. In other words, the full cost of new infrastructure
cannot be imposed upon developers, if there will be some benefit to the municipality at large.
In regard to the first issue (related to the off-site levy bylaw), the court held that the majority of the bylaw was validly passed. However, there was one
particular infrastructure project which had not been properly dealt with pursuant to the Regulation. That project related to a bridge and road, the full
cost of which had been allocated to developers. The court did indicate that, where a municipality comes to the legitimate conclusion that there will be
no benefit to existing residents, the entirety of the cost could be attribute to new development. However, it was obvious that existing residents would
derive some benefit from the bridge project. It is not good enough to say that “but for” a new subdivision, a project would not have gone ahead, and
therefore, all of the costs should be recovered by imposing a levy on new development. The levy must be calculated according to the benefit derived
by new development, as compared to the benefit derived by existing development.
In regard to the second issue (Contribution Agreement), the court held that a municipality could not utilize its natural person powers and purport to
enter into a “voluntary” agreement with developers, when section 648 effectively prohibited the imposition of an off-site levy related to the payment,
and the municipality was really imposing the agreement upon developers.
The Contribution Agreements adopted by the Municipality purported to charge developers for police and fire services, outdoor facilities,an arena, a
water spray park, an off leash park, and the rehabilitation of the Performing Arts Centre. Clearly, those types of charges would not be allowed under
section 648 of the MGA. The Municipality recognized this, and did not purport to impose these charges by way of an off-site levy. Rather, they adopted
a form of agreement together with per acre charges, which they were asking developers to absorb. However, according to the evidence accepted by
the court, it was also clear that the Municipality intended to impose these agreements on developers, as a condition of development or subdivision.
The court therefore held that this was a colourable attempt by the Municipality to circumvent the restrictions of section 648 of the MGA. The resolution
was therefore declared invalid.
The Wills and Succession Act is now in Force in Alberta
In making this declaration, the court made it clear that it was certainly possible for a municipality to utilize its natural person powers and enter into a
voluntary agreement with a developer. However, such an agreement had to be truly voluntary. A municipality cannot use its legislated powers to impose
Maya such an C. agreement Gordonagainst a developer’s will.
It is of interest that, in this case, the developer sought court declarations that the off-site levy bylaw, and the resolution related to the Contribution
Agreement, were both invalid. However, there was no evidence that the developer signed, or was asked to sign, a Contribution Agreement. In the result,
there is still an open question about the validity of such an agreement, once it is signed. In other words, if the developer had signed an agreement
which acknowledged that it was a voluntary agreement, and therefore a contract between two parties, in the appropriate circumstances it could still be
arguable that such an agreement is valid. However, much would depend upon the facts, and the evidence.
There was no evidence or discussion in this case about voluntary payments which may have already have been made by other parties (presumably after
having entered into such agreements). Whether or not those payments can now be recovered is therefore an issue that will have to wait for another
day. However, existing case law would suggest that any claim for repayment would be limited to payments made during the time prescribed by the
Limitation Act.
2

The CRTC and Municipal Access Agreements
By Aisling Ryan
With an increased number of companies entering into the telecommunications markets, municipalities have had to mediate and accommodate an increased demand
for access to municipal rights-of-way, including roads and street crossings, all for the purpose of allowing telecommunication companies to install, operate, and
maintain their infrastructure and transmission facilities. Transmission companies and municipalities generally negotiate Municipal Access Agreements to permit
telecommunication companies to lay telecommunication utilities within municipal rights of ways. Even though these companies must negotiate with individual
municipalities, this area falls under federal jurisdiction, and when a dispute arises, the parties may apply to the Canadian Radio-television and Telecommunications
Commission (the “CRTC”) to resolve the dispute.
Section 43 (3) of the Telecommunications Act (the “Act”) requires Canadian carriers to obtain the consent of a municipality or other public authority before
constructing a transmission line on a highway or other public place. When a carrier cannot obtain the consent of the municipality, that carrier can apply to the
CRTC to settle the dispute. In a 2001 decision between Ledcor and the City of Vancouver (Decision CRTC 2001-23), the CRTC considered input from the involved
parties and from other interested parties. The CRTC then developd a list of principles to assist carriers and municipalities in creating Municipal Access Agreements.
In the Ledcor decision, the CRTC recognized that municipalities play an important role in coordinating and administering access to municipal rights-of-way, and that
a Municipal Access Agreement may need to accommodate other users of the right-of-way, not just the telecommunication carriers. However, as telecommunications
falls under exclusively federal jurisdiction whether or not the transmission lines can be constructed within a municipal right-of- way is also a matter of federal
jurisdiction. As a result, municipalities are required to accommodate such transmission lines, but the commission will permit Municipal Access Agreements to cover
some of the costs incurred by municipalities to run these transmission lines.
The CRTC found that it was appropriate that the Municipality recover causal costs incurred in accommodating these transmission lines. Fixed costs, those that do
not vary from project to project, should be covered by tax revenue and not charged to carriers. The CRTC did permit a further 15% loading on the causal costs to
accommodate plan approval and inspection costs.
The CRTC also permitted municipalities to charge other associated costs to the carrier. For instance the CRTC found that the municipality can charge traffic signage
costs incurred during the construction of the telecommunications lines through the municipal rights-of way, as well as pavement restoration derived from a
standard rate schedule for such construction work. However, losses incurred in other operations, loss of parking meter revenue, transit operating delays, and lost
productivity for city operations are to be recognized as part of the 15% on causal costs. Some charges were found to be appropriate as one time payments such
as a one-time charge for pavement degradation (the costs of repairing pavement surfaces). On the other hand, the CRTC determined that it was inappropriate for
certain items to be charged to the carrier, such as a charge for public delays and costs associated the negotiation of the Municipal Access Agreement. The CRTC
also determined that it would be inappropriate for a municipality to charge carriers land-based charges such as those charged to business on a market-based rate.
The CRTC further determined that it was acceptable and appropriate for the Municipal Access Agreements to be fixed term agreements as carriers do not have an
automatic right to remain on the right-of-way. Such agreements should be open to re-negotiation periodically.
The Ledcor principals provided municipalities with a basis for creating acceptable Municipal Access Agreements with municipalities. However, the CRTC has now
requested comments and submissions regarding the model agreement to be used in the future. The CRTC will then reconsider these issues with a view to adopting
a new model that will allow for increased telecommunications activities to occur within municipalities. Municipalities are therefore encouraged to consider their
positions, and make their issues known to the CRTC.
Bonded Construction Projects: Obtain Delivery of Executed Bonds
Prior to Construction Commencing
By Nick Parker
Municipalities are often involved in construction projects
in which the contract between the municipality and the
contractor requires the contractor to provide a Performance
Bond and a Labour and Material Payment Bond. These
bonds provide protection for both the municipality and
sub-contractors working on the project in the event that the
contractor defaults on the construction project. However,
these bonds are a unique
form of contract called a
Deed and therefore, special
rules apply compared to most other contracts. The
most critical requirement from the perspective of
a municipality is that the bond contract may not
be enforceable unless the bond is executed by
both the bonding company and the contractor and
actually delivered with these original signatures to
the municipality.
Tanya M. Pon
Manager
Business Development
Phone: 780.497.3329
Email:
tpon@rmrf.com
Court decisions in Canada have established that delivery of the bonds in this form is
required to make the bonds effective. It is therefore extremely important that before
a municipality allows construction to commence under a bonded project, it have in
its possession the originally executed bonds. The project should not be allowed to
commence, and no money should be paid to the contractor until the bonds in this
form are delivered to the municipality. The municipality should then treat the bonds
as important documents and store them with other important documents in a vault
or other safe place.
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10180-101 Street
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3

ANNOUNCEMENTS
RMRF LLP would like to
congratulate Wesley M. Pedruski
for receiving his Queen’s Counsel
(Q.C.) designation. This designation
recognizes his exceptional merit
and contribution to the legal
profession. We are proud to have
him on our team.
We are delighted to report that
partner Francis C. R. Price, Q.C.
and his wife Marguerite Trussler
were honored by the University of
Alberta with its 2011 Distinguished
Alumni Award. This is the Alumni
Association’s most prestigious
award, recognizing living
graduates whose truly outstanding
achievements have earned
them national or international
prominence.
RMRF LLP is pleased to announce
that Sean Ward has become a
partner with our firm. Sean articled
at the Court of Queen’s Bench and
then finished his articles with
RMRF LLP. Congratulations Sean!
RMRF LLP has been a trusted advisor to
municipalities for years. We are also the
preferred legal service provider to AUMA,
and the casual legal service provider to
AMSC*. Members of the AMSC program
are entitled to contact us, free of charge, to
discuss issues of concern (1.888.668.9198).
Members also have access to our weekly
notice to municipalities advising of
developments in the law, risk management
issues and hot topics of interest to
municipalities.
The New Wills and Succession Act
By Maya C. Gordon
Allan Farmer, Q.C.
780.497.3360
afarmer@rmrf.com
Bill Barclay
780.497.3379
wbarclay@rmrf.com
Todd Shipley
780.497.3339
tshipley@rmrf.com
As of February 1, 2012, most sections of the new Alberta Wills and Succession
Act have come into force. This Act makes significant changes to wills and estate
legislation in Alberta, changing and consolidating the current legislation relating to
the validity and interpretation of wills, how estates are distributed when there is no
will, survivorship, and dependent’s relief applications.
One section of the new Act was not brought into effect on February 1, 2012 and
is still being considered by Alberta Justice. This section revises the Matrimonial
Property Act and gives the spouse of a deceased a matrimonial property claim upon death, along with
his or her gift under the will.
In light of this new legislation, it is important to revisit your estate planning documents with your lawyer
to ensure that they still reflect your wishes.
Sheila McNaughtan, Q.C.
780.497.3362
smcnaughtan@rmrf.com
Albert Lavergne
780.497.3310
alavergne@rmrf.com
Shelly Chamaschuk
780.497.3364
schamaschuk@rmrf.com
OUR MUNICIPAL TEAM
Matthew Woodley
780.497.3307
mwoodley@rmrf.com
Randy McCreary
780.497.3348
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780.497.3372
ckillick @rmrf.com
Mark Hildebrand
780.497.3316
mhildebrand@rmrf.com
Doris Bonora
780.497.3370
dbonora@rmrf.com
Nick Parker
780.497.3342
nparker@rmrf.com
Sean Ward
780.497.3334
sward@rmrf.com
Carol Zukiwski
780.497.3350
czukiwski@rmrf.com
Kelsey Becker Brookes
780.497.3304
kbeckerbrookes@rmrf.com
Paul Greep
780.497.3312
pgreep@rmrf.com
*AMSC (Alberta Municipal Services
Corporation) is a wholly-owned
subsidiary of the AUMA.
4
By-Law is published periodically by Reynolds
Mirth Richards & Farmer LLP. It is intended
to provide comments on recent legal
developments and issues of general interest.
It is not intended to give legal advice. You
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780.497.3367
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