“Regulating” and “Prohibiting” – What’s the Difference?

There are many legal issues that local governments have had to wrestle with in the 25 years since this firm was established. One issue that continues to arise is the difference between the power to prohibit and the power to regulate. A recent decision of the British Columbia Court of Appeal illustrates the difficulties that can result when attempting to differentiate between these two powers, which are treated as being distinct under the Community Charter and the Local Government Act.

In Peachland (District) v. Peachland Self Storage Ltd., 2013 BCCA 273,  the Court of Appeal was asked to determine whether a soil removal bylaw imposed a prohibition or was a “regulation” respecting soil removal.  If the bylaw imposed a prohibition, it required approval of the minister responsible, pursuant to section 9(3) of the Community Charter.  If it was a “regulation”, the minister’s approval was not necessary.

The plaintiff in this case, Peachland Self Storage, had applied for and received a provincial permit under the Mines Act for the operation of an aggregate quarry on a parcel of land it owned within the District of Peachland.  Its permit allowed for the extraction of up to 100,000m3 of aggregate on its property per year.  However, Peachland’s bylaw limited soil removal on a parcel of land to 200m3 per year.

Peachland Self Storage challenged the bylaw on the grounds that the soil removal restrictions were so severe that they amounted to a prohibition, and that as Peachland had not submitted the bylaw for ministerial approval, the bylaw was invalid.

The District argued that as long as a bylaw does not completely forbid an act, the bylaw does not contain a prohibition.  The Court of Appeal disagreed and declared the bylaw invalid.  It examined the purpose of the requirement for ministerial approval of soil removal prohibitions in the Community Charter, and found that the purpose of requiring ministerial approval was to protect the provincial interest in mineral extraction industries.  Any restriction so severe that it removed the possibility of any industrial scale extraction was in effect a prohibition against soil removal.  The Court of Appeal found that the bylaw effectively precluded commercial sand and gravel extraction, and was in fact prohibitory, even though on its face the bylaw permitted some extraction.

In coming to this conclusion, the Court discussed other cases in which the issue was whether a particular provision in a bylaw was prohibitive or merely regulatory. The cases illustrate that there is no clear bright line between these two concepts. The cases state that although legislation may create a distinction between the power to regulate and the power to prohibit, in reality the power to prohibit necessarily implies the power to restrain the doing of that which is contrary to the regulation.  As the Court of Appeal noted, while the legislation assumes a clear distinction can be drawn between prohibiting and regulating, in reality it is difficult to draw a clear line, which makes it difficult for local governments to know the limits of their jurisdiction.

The case is an example of how the drafters of local government bylaws must carefully examine the purpose behind a legislative grant of power, and must keep that purpose in mind when determining whether a proposed bylaw imposes a mere restriction and is “regulatory” in effect, or amounts to a prohibition.