Comptroller of Water Rights, Water Sustainability Act v. Harrison Hydro Project Inc., Fire Creek Project Limited Partnership, Lamont Creek Project Limited Partnership, Stokke Creek Project Limited Partnership, Tipella Creek Project Limited Partnership, and Upper Stave Project Limited Partnership

File Number:
2021 BCSC 195

Decision Date: February 9, 2021

Court: B.C.S.C., Justice Power

Citation: 2021 BCSC 195

The Comptroller of Water Rights (the “Comptroller”) sought a judicial review of a July 26, 2019 decision of the Board (Harrison Hydro et al v. Comptroller of Water Rights, Decision Nos. 2017-WAT-003(b) and 2017-WAT-004(b)).

The Board’s decision related to the appeals of two orders issued by the Comptroller in 2017. The orders were appealed by Harrison Hydro Project Inc. (“Harrison”) and five limited partnerships. Harrison is the general partner of the five limited partnerships. Each limited partnership owns and operates a “run of river” hydro project. Each project operates under a water licence authorizing the diversion of water from a stream to produce power.

In the 2017 orders, the Comptroller adjusted the water rental billings for the five projects for the years 2011 and 2012 by aggregating the power produced at the projects, which resulted in significantly higher water rates than if the projects were billed separately. The Comptroller adjusted the water billings following a previous decision of the Board (which was confirmed on judicial review: Harrison Hydro Project Inc. v. British Columbia (Environmental Appeal Board), 2018 BCCA 44, leave to appeal refused [2018] S.C.C.A. No. 146), that the five water licences were properly amended in 2013 by naming Harrison, rather than the limited partnership that owned that particular project, as the holder of each water licence.

On appeal, the Board found that the Comptroller had no statutory authority to retroactively adjust the water billings that were paid for the 2011 and 2012 years. After reviewing the relevant sections of the Water Sustainability Act (the “Act”) and the Water Sustainability Fees, Rental and Charges Tariff Regulation (the “Regulation”), the Board determined that any adjustments made by the Comptroller in respect of water rental bills are forward-looking. Given that Harrison’s water licences were amended in 2013 to make Harrison the holder of all five licences, the adjustment of rental fees for those licences could only take effect from 2013 onwards.

The Comptroller sought a judicial review of the Board’s decision by the B.C. Supreme Court. The question for the Court was whether the Board’s decision was reasonable. The Court confirmed that its role was not to re-evaluate the evidence that the Board had considered, interfere with the Board’s fact-finding functions, or substitute its decision for that of the Board. After reviewing the Board’s analysis of the legislation and the evidence, the Court found that the Board reasonably concluded that the language of the Act and the Regulation did not give the Comptroller the power to retroactively adjust water rental fees. The petition was dismissed, and the Board’s decision was confirmed.