Business Licence: Municipal Council Reasons

Posted by Johannes Schenk on October 5th, 2006 — Posted in Municipal Law

377050 BC Ltd. dba the Inter-City Motel v. City of Burnaby, 2006 BCSC 1072, deals with the refusal of a motel operation busines licence and the requirement for a municipality to provide adequate reasons for the licence refusal.

On the facts, the City of Burnaby had concerns about illegal activity occurring on the premises and decided against issuing a business licence. Upon a request for reasons and what municipal bylaw the motel operation was breaching the City of Burnaby responded:

Rather, City Council exercised its authority under Section 60 of the Community Charter to not renew the business licence for what it considered to be reasonable cause, namely, poor management of the operation of the motel giving rise to concerns for public safety, the enjoyment of use of neighbouring properties, and a high demand for police services related to the business.

The following subsections of section 60 of the Community Charter, R.S.B.C. 2003, c. 26 govern business licence applications:

(1) An application for a business licence may be refused in any specific case, but

(a) the application must not be unreasonably refused, and

(b) on request the person or body making the decision must give written reasons for the refusal.

While the City of Burnaby did provide reasons for the business licence refusal the issue turned to whether the reasons were sufficient. Justice Burnyeat had this to say:

The “reasons” set out in the April 4, 2006 letter to the Petitioner are not satisfactory. First, no licence can be denied merely because there has been a finding that “poor management” was present. If that was the case, many licences would not be granted or renewed. Second, “concerns” are not “reasons”. “Reasons” should set out the facts or findings upon which the Council concluded that the application for a business licence should be denied. Third, the “reasons” merely repeat the recommendations made in the January 10, 2006 Report from the “Director Finance” rather than the reasons why Council found it necessary to deny the application of the Petitioner. Fourth, “concerns for public safety, the enjoyment of use of neighbouring properties, and a high demand for police services related to the business” are not “reasons” they are “conclusions.” The Petitioner is entitled to know the reasons why counsellors came to those conclusions. Fifth, there is no detail about what “safety” of the public was of concern to the Councillors whether or not it arose as a result of “poor management”. There is no indication of what “enjoyment of use” relating to neighbouring properties resulted because of the “poor management”. There was no context for the comment that there “a high demand for police services”.

In summary, when rejecting a business licence application a municipal council must give reasons in keeping with the principles of fundamental justice. The applicant has to be able to understand the facts underlying the licence rejection and how those facts were used to reject the application. Reasons that are in effect conclusions will not satisfy that standard.

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