Executive Summary: Key Legal and Evidentiary Issues

• A retaining wall, fill, and concrete pad built on the defendants' leased property encroached onto an adjacent lot owned by Tsawwassen First Nation.
   
• Common law trespass and trespass under TFN's Land Act were both at issue given the physical encroachment onto Lot 4.
   
• Whether TFN had consented to the encroachments, expressly or by acquiescence, was a central dispute.
   
• Defendants argued their 2014 reconstruction of the retaining wall was only a technical, de minimis breach of the Headlease.
   
• Appropriate remedies for the trespass and breach, including a mandatory injunction, required consideration by the court.
   
• Entitlement to solicitor-client costs under the Headlease's indemnity provision was also disputed.
   

Facts of the case

Wayne John Martinolich and Kathleen Mary Martinolich lease a residential property at 1263 Pacific Drive, Tsawwassen, BC from Tsawwassen First Nation ("TFN"). The property borders a bluff, also owned by TFN, and the section of the bluff adjacent to the property forms part of a separate parcel, Lot 4. The property's rear yard contains a wooden retaining wall and a concrete pad leading to a seating area, along with a volume of fill beneath the yard. Most of the retaining wall and the concrete pad predate the defendants' acquisition of the leasehold interest in 2010, but the defendants constructed a new section of the retaining wall in 2014. The retaining wall (including the 2014 addition) encroaches onto Lot 4 by 4.71 metres at its furthest point, and the concrete pad encroaches by 6.79 metres. A 2021 topographic survey revealed these encroachments to TFN for the first time. On November 30, 2021, TFN issued a Notice of Trespass demanding removal of the retaining wall and concrete pad by May 30, 2022. TFN granted several extensions, the last ending June 1, 2023, but the defendants never provided a removal plan. In November 2021, during heavy rainfall, saturated fill beneath the retaining wall gave way in a debris slide, undermining the wall's structure.

Policy, legislative, and contractual provisions at issue

TFN's Land Act, in force since April 3, 2009, governs trespass on Tsawwassen Public Lands. Section 39 lists trespass offences, including occupying Tsawwassen Public Lands without authority and constructing structures on them. Section 35 empowers TFN's Executive Council to require a trespasser to cease the trespass, restore the land, pay compensation, or have improvements removed at the trespasser's cost. Section 38 gives an affected person a right to seek review of such an order, which the defendants did not exercise. The property is also subject to a Headlease between Canada and Stahaken Developments Ltd., under which TFN succeeded as lessor. The Headlease requires a lessee to obtain an Improvement Permit before constructing improvements (s. 5(1)), to secure written consent for improvements consistent with the Environmental Program in Schedule "A," to comply with all applicable laws (s. 13), to submit plans to a review committee (Schedule "A," s. 2.3(a)), and, for structures within the Bluff Management Zone, to obtain a sealed geotechnical opinion before construction (Schedule "C"). Section 12 of the Headlease also obliges the lessee to maintain improvements on the demised lands in good repair. Separately, TFN's Building Regulation requires a registered professional to conduct field reviews for retaining structures of 1.22 metres or more in height. Section 19 of the Headlease, the Remedies Provision, entitles TFN to recover costs on a solicitor-client basis where a lessee defaults on its covenants.

Reasoning and analysis

The court found that the retaining wall, fill, and concrete pad directly and physically intruded onto Lot 4, satisfying the elements of common law trespass, and that the defendants' continued refusal to remove them after notice constituted an intentional, continuing trespass. Because TFN did not know the structures encroached onto Lot 4 until April 26, 2021, it could not be found to have acquiesced to the encroachments beforehand, and its consent to the 2010 Assignment Agreement did not extend to authorizing the encroachments. Turning to the Headlease, the court held that the defendants were bound by its terms, having had the opportunity to review them before and after signing the Assignment Agreement. Constructing the new retaining wall section in 2014 fell within the Headlease's definition of "improvements," and the defendants breached the Improvement Permit, Environmental Program Compliance, and Committee Approval requirements by proceeding without permits or authorization. They also breached the Geotechnical Opinion Requirement, since part of the new wall was built within the Bluff Management Zone without a sealed geotechnical opinion, and breached the Building Regulation's Professional Review Provision, since the wall's height of 1.5 metres exceeded the 1.22-metre threshold requiring professional field review by roughly 23%. The court rejected the defendants' de minimis argument, noting they had conceded during closing submissions that the encroachment was not trivial. Given the strong presumption favouring injunctive relief in continuing trespass cases, and expert evidence that the fill and wall posed genuine slope-stability risks, the court determined that permitting the encroachments to remain would effectively amount to an uncompensated taking of TFN land.

Ruling and overall outcome

The court ruled substantially in favour of the plaintiff, Tsawwassen First Nation, finding the defendants liable for continuing trespass under both the common law and TFN's Land Act, as well as breach of the Headlease. TFN was granted a mandatory injunction requiring the defendants, at their own cost, to retain a qualified geotechnical engineer (subject to TFN's approval), prepare and implement a removal plan for the retaining wall, fill, and concrete pad, and restore the affected slope, with any unresolved disputes over the plan returnable to court. The court also held that TFN was entitled to its costs of the action on a solicitor-client basis, pursuant to the Remedies Provision in section 19 of the Headlease, having found the defendants failed to justify departing from that contractual term. No specific dollar figure for the solicitor-client costs was determined in this judgment; the amount was left to be assessed rather than fixed.