Decision No. 32-R-2020

SUMMARY

[1] On December 20, 2019, the District filed an application with the Canadian Transportation Agency (Agency) pursuant to subsection 101(3) of the CTA for authorization to construct and maintain a utility crossing, specifically a watermain.

[2] For the reasons set out below, the Agency authorizes the construction and maintenance of the utility crossing at mileage 38.62 of CN Squamish Subdivision in the District of Squamish, in accordance with the design drawings and specifications, Drawing No. 15‑0605-W5-1, dated 2017-06-20 (June 2017 Drawings) that were approved by CN on December 2, 2019.

BACKGROUND

[3] The District is a municipality pursuant to the Local Government Act, RSBC 2015, c. 1 and the Community Charter, RSBC 2003, c. 26.

[4] The railway line is owned in fee simple by the British Columbia Railway Company and operated by CN pursuant to a lease agreement dated July 17, 2004.

[5] The District intends to install the proposed watermain for a new residential development over a parcel of land identified as PID 024-779-407 for which the legal description is: “that 1.660 hectare portion of District Lot 4266 Group 1 New Westminster District shown on plan LMP46000.” The proposed watermain will be installed on an existing highway overpass at Clark Drive that crosses the railway line at that location.

[6] The District and CN have a valid road crossing agreement governing the highway overpass crossing at Clark Drive. This road crossing agreement, dated April 30, 2019, is not at issue in this case.

[7] The District has agreed to construct and maintain the watermain at its own cost. CN agrees with the location, design and method of construction of this utility crossing. However, the parties have not been able to agree on the terms and conditions for the utility crossing.

THE LAW

[8] Subsection 101(3) of the CTA states:

If a person is unsuccessful in negotiating an agreement or amendment mentioned in subsection (1), the Agency may, on application, authorize the construction of a suitable road crossing, utility crossing or related work, or specifying who shall maintain the crossing.

POSITIONS OF THE PARTIES

The District

[9] The District states that CN approved the June 2017 Drawings for the watermain on December 2, 2019. The District claims that it proposed to CN that the utility crossing be incorporated into the existing road crossing agreement on the same date.

[10] The District claims that CN refused to incorporate the utility crossing into the road crossing agreement on December 10, 2019. Instead, the District asserts that CN provided it with a draft of its standard form utility crossing agreement, which included terms which the District rejected when negotiating the road crossing agreement.

[11] The District states that it proposed an alternative agreement without the objectionable terms on December 12, 2019, but that CN did not respond. Consequently, the District filed a utility crossing application with the Agency.

[12] The District argues that since the parties have failed to negotiate an agreement to construct the watermain at the crossing location, the Agency has jurisdiction under section 101(3) of the CTA to authorize the utility crossing.

[13] The District refers to paragraph 55 of the Agency’s Decision No. 113-R-2016, which quotes the ruling in Fafard v. Canadian National Railway Company, 2003 FCA 243 that a “...suitable crossing is a crossing that is adequate and appropriate for the purposes for which it was intended and installed.”

[14] The District submits that the watermain meets these requirements. It is necessary to provide a dependable supply of water to approximately 2,500 residents of a new residential development called Waterfront Landing, which is bordered by the railway line to the east and by a saltwater channel to the north and west. The railway line cuts off the new residences from the District’s water infrastructure systems. The District also stresses that CN agrees with the location, design and method of construction of the utility crossing.

[15] The District states that the dispute concerns terms and conditions that CN wishes to impose in relation to the proposed utility crossing. It submits that the Agency concluded in Decision No. 28-R-2019 that it does not have jurisdiction to order terms and conditions in relation to a utility crossing, other than those related to the construction and maintenance of the crossing.

[16] Alternatively, should the Agency find that it has jurisdiction to order terms and conditions in the case at hand, the District argues that the Agency’s order should not include CN’s proposed terms and conditions related to compensation, termination and renewal, liability, dispute resolution and control of construction and maintenance. The District argues that the Agency’s past decisions or consistently held principles do not support the imposition of those terms or conditions in this instance.

[17] In its reply, the District notes that CN has consented to the relief sought in the application, but that the parties have not reached an agreement on the terms and conditions relating to the utility crossing. The District therefore requests that the Agency authorize as soon as possible the construction and maintenance of the watermain in accordance with the June 2017 Drawings, which CN has already approved.

CN

[18] CN agrees that it reviewed and approved the June 2017 Drawings for the utility crossing on December 2, 2019.

[19] CN states that it provided its standard form of utility crossing agreement to the District on December 10, 2019, for discussion. CN acknowledges that the District indicated that it did not agree with some terms of CN’s standard form agreement and proposed an alternative agreement on December 12, 2019. CN claims that the application for authorization of the utility crossing was filed before it had the opportunity to review and respond to the District’s alternative agreement.

[20] CN submits that it consents to an order authorizing, at the District’s expense, the construction and maintenance of the watermain on an overhead structure located at mile 38.62 of the CN Squamish Subdivision.

[21] CN argues that the Agency should not impose additional terms on the authorization of the utility crossing, and it makes no request for any additional terms.

[22] CN submits that the Agency should allow the parties to negotiate their own crossing agreements, arguing that the negotiation and settlement of issues assist parties to resolve differences and avoid future litigation. CN submits that the Agency should limit its order to what is sought by the District.

ANALYSIS AND DETERMINATIONS

[23] Subsection 101(3) of the CTA provides that if the parties are unsuccessful in negotiating an agreement or amendment to an agreement, the Agency may, on application, authorize the construction of a suitable crossing, utility crossing or related work, or specify who shall maintain the crossing.

[24] The Agency finds that the parties have been unsuccessful in negotiating an agreement for the construction and maintenance of a watermain to be installed on the existing highway overpass at Clark Drive that crosses the railway line at that location.

[25] The Agency finds that the proposed watermain is a suitable utility crossing. It is necessary to provide a dependable supply of water to approximately 2,500 residents of a new residential development, and the parties agree with the location, design and method of construction of the utility crossing. The District has agreed to construct and maintain the utility crossing at its own cost.

[26] Both parties argue that they should have the opportunity to negotiate the terms of the utility crossing agreement, and the Agency agrees.

CONCLUSION

[27] Therefore, the Agency finds it appropriate to issue an order authorizing the District to construct and maintain, at its own expense, the utility crossing.

ORDER

[28] In light of the foregoing, pursuant to subsection 101(3) of the CTA, the Agency authorizes the District to construct and maintain a utility crossing, specifically a watermain, on an existing highway overpass at Clark Drive, at mileage 38.62 of CN Squamish Subdivision in the District of Squamish, in accordance with the June 2017 Drawings that were approved by CN on December 2, 2019.