Class Action Overview
The within proposed class proceeding arises from the unlawful conduct of the Defendants, 1331603 B.C. LTD., doing business as, WHITETAIL HOMES (“1331603”), WHITETAIL HOMES LTD. (“Whitetail”), and/or LUC GOSSELIN (“Gosselin”), in relation to the sale of pre-sale development units in a mixed-use, multi-family residential and commercial development on lands located at 20769 Fraser Highway, in the City of Langley, in the Province of British Columbia (the “Development”).
In particular, the Defendants, 1331603, Whitetail and/or Gosselin, as the developers, filed with the British Columbia Superintendent of Real Estate and subsequently issued a required disclosure statement, dated June 23, 2023 (the “Disclosure Statement”) to purchasers, including the Plaintiffs and putative class members, that misrepresented a material fact, contrary to the Real Estate Development Marketing Act, S.B.C. 2004, c. 41 (“REDMA”), by representing that the land on which the Development is being constructed does not lie within an area that may be subject to flooding, which was false, inaccurate and misleading.
At all material times to the cause of action herein, and as early as September 2021, the Defendants knew, or ought reasonably to have known, that the lands of the Development were located within a floodplain and are subject to the City of Langley’s (“City”) Floodplain Elevation Bylaws Nos. 2768 and 3232, and that this information constituted a material fact that reasonably affected the value, price, or use of the pre-sale development units in the Development.
Despite that knowledge, the Defendants, 1331603 and Gosselin, provided the Disclosure Statement containing the misrepresentation of the floodplain designation of the lands of the Development to all purchasers of the pre-sale development units in the Development, including the Plaintiffs and putative class members, which they knew was false, inaccurate and misleading.
The Plaintiffs and putative class members purchased pre-sale development units in the Development and paid deposits in reliance on the representations made by the Defendants, 1331603 and Gosselin, in the Disclosure Statement, in particular, that the lands of the Development are not located within a floodplain.
The Disclosure Statement was amended on four separate occasions:
(collectively, the “Disclosure Statements”).
At all material times to the cause of action herein, the Defendants, 1331603 and Gosselin, continued to misrepresent the floodplain designation of the lands of the Development.
None of the Disclosure Statements plainly disclosed that the lands of the Development are located within a floodplain, nor did the Defendants, 1331603 and Gosselin, correct the misrepresentation, as required by REDMA, specifically their obligation to disclose material facts and to amend the Disclosure Statement upon becoming aware of any misrepresentation.
The Plaintiffs seek relief on their own behalf and putative class members for the Defendants’, 1331603’s, Whitetail’s and/or Gosselin’s, unlawful conduct, including, inter alia: (i) statutory relief under REDMA, including a declaration that the purchase agreements for the pre-sale development units in the Development are void for non-compliance, the return of all deposits paid together with interest and all damages that accrue therefrom; (ii) breach of the Business Practices and Consumer Protection Act, S.B.C. 2004, c. 2 (“BPCPA”); (iii) breach of the Competition Act, R.S.C. 1985, c. C-34 (“Competition Act”); (iv) intentional misrepresentation under common law; (v) breach of contract; (vi) fraudulent concealment; and (vi) such further and other relief as this Honorable Court deems just, including punitive damages.
This action is brought on behalf of members of a class consisting of the Plaintiffs and all persons and/or legal entities resident in British Columbia who purchased one or more pre-sale development units in the mixed-use, multi-family residential and commercial development located at 20769 Fraser Highway, Langley, British Columbia, from the Defendant, 1331603, between June 23, 2023 and the date of certification of this proceeding (“Class” or “Class Members”).
Factual Allegations
The Development and its marketing
The lands on which the Development is located are legally described as follows:
Parcel Identifier: 031-681-476
Legal Description: LOT A DISTRICT LOT 36 GROUP 2 NEW WESTMINSTER DISTRICT PLAN EPP116332
(the “Lands”).
In or around September 2021, the Defendant, Whitetail, purchased the Lands, for the purpose of redeveloping the then-existing development, which had a civic address at 20785 Fraser Highway, Langley, and the Defendant, Gosselin, submitted a redevelopment proposal to the City.
In or around May 2022, the Defendant, 1331603, acquired the title to the Lands.
In or around December 2023, after the rezoning of the Lands, the civic address was changed to its current address.
The Development consists of a six-story, wood-frame, 210-unit multi-family mixed-use, residential and commercial building constructed above a single-level, below-grade concrete parkade and storage areas.
Further, of the 210 units, 10 units are designated as commercial units, and are located at ground level, with ground level parking.
The Development is subject to an estimated completion range, with purchasers to receive notice within 10 days of completion.
The Development is marketed as “Unity South Langley” on the “Whitetail Homes” website along with the Defendants’ other completed and ongoing residential and/or commercial development projects.
A separate Whitetail Homes website for Unity South Langley Condos (the “Unity Website”) features, inter alia, architectural renderings of the exterior of the Development, photographs of a model suite, and descriptions of the amenities offered.
Additionally, the Unity Website identifies the location of the Development, highlights its proximity to downtown Langley and nearby attractions, amenities, and restaurants, and includes a map showing the precise location of the Development.
Lands affected by Floodplain Elevation Bylaw
On June 7, 2010, pursuant to s. 524 of the Local Government Act, R.S.B.C. 2015, c. 1, the City enacted Floodplain Elevation Bylaw No. 2768 (the “Floodplain Elevation Bylaw”) in response to the risk of flood damage, including risks associated with climate change.
In or about 2023, the City amended the Floodplain Elevation Bylaw by enacting Amendment No. 1, 2023, Bylaw No. 3232, to address increased flood risk associated with climate change and to reduce exposure to flooding risks for new developments by minimizing potential damage to structures and property due to flooding.
The Floodplain Elevation Bylaw designates lands subject to floodplain restrictions in Schedule A, entitled “Designated Floodplain Flood Construction Levels for the Nicomekl River, Murray Creek, Logan Creek, and Jeffries Brook” (the “Floodplain”).
The Floodplain Elevation Bylaw establishes the minimum elevation at which building foundations and habitable areas, defined as any room or space with headroom greater than 1.8 meters (5.9 feet) within a building or structure that is or can be used for human occupancy, commercial sales, or the storage of goods, possessions, or equipment (including furnaces) that would be subject to damage if flooded, must be constructed within designated floodplain areas.
Further, pursuant to the elevation requirements in the Flood Elevation Bylaw, the underside of any floor system, or the top of any space or room, that is used for dwelling purposes, business, or the storage of goods which are susceptible to damage by floodwater, must be constructed at or above the applicable flood construction level.
The Floodplain Elevation Bylaw specifies Flood Construction Levels (“FCLs”) as measured in meters (m) above the Geodetic Survey of Canada datum (Coordinate System: NAD 1983 CSRS UTM Zone 10N; Vertical Datum: CGVD2013) for specific parcels of land located within the Floodplain.
The FCLs are area-specific and consist of the designated flood level established by the City plus an allowance for freeboard, the vertical distance between the maximum anticipated water level (like a flood or high tide) and the top of a structure.
The FCLs applicable to a particular parcel of land within an area is determined by interpolation between its two closest contour line levels as shown on Schedule A to the Floodplain Elevation Bylaw.
The Lands are located within the Floodplain and are subject to the Floodplain Elevation Bylaw. As a result, all habitable areas must be constructed at or above the applicable FCL in compliance with the Floodplain Elevation Bylaw.
Defendants' knowledge that the Lands lie in the Floodplain
As early as at least September 2021, the Defendants knew, or ought to have known, that the Lands were located within the Floodplain and subject to the Flood Elevation Bylaw, including, inter alia, through communications between their architects, engineers, representatives, consultants, and/or agents, and the City.
The proposed mixed-use residential and commercial nature of the Development was not consistent with the uses permitted under the Lands’ Medium-Density Residential designation in the Official Community Plan (“OCP”) or under Land Use Contract (“LUC”), and required, inter alia, an OCP amendment and the discharge of the LUC to proceed.
In or about September 2021, shortly after acquiring the Lands, the Defendant, Gosselin, submitted development applications to the City, including:
in order to permit the Development.
In connection with these applications, the Defendants were required to address floodplain-related requirements imposed by the City, including compliance with the Floodplain Elevation Bylaw and applicable FCLs.
As part of the development approval process, the Defendants were required to prepare and submit engineering and servicing materials addressing flood risk, including stormwater management requirements applicable to the Lands.
The Defendants' misrepresentation regarding the floodplain designation of the Lands
Despite the Defendants’ knowledge regarding the floodplain designation of the Lands as early as September 2021, they misrepresented and concealed the floodplain designation of the Lands from the Plaintiffs and Class Members.
On June 23, 2023, despite knowing that the Lands lie within the Floodplain and are subject to the Floodplain Elevation Bylaw, the Defendants, 1331603 and Gosselin, expressly misrepresented in the Disclosure Statement that:
To the best of the Developer’s knowledge, the land on which the Development is being constructed does not lie within an area which may be subject to flooding. [Emphasis added]
The Disclosure Statement was executed by the Defendants, 1331603 and Gosselin.
As early as November 2023, the Defendants retained 3A Hydrotech Solutions Inc. (“Hydrotech”), hydrotechnical engineers, to prepare a flood assessment report for the Lands (the “Flood Assessment Report”) in response to the City’s requirements under the Floodplain Elevation Bylaw and as a prerequisite to the issuance of a development and/or building permit for the Development.
The Hydrotech Flood Assessment Report was finalized on December 4, 2023, and was subsequently submitted to the City.
In preparing its Flood Assessment Report, Hydrotech relied on information obtained from public sources, the City, and/or the Defendants, including, without limitation:
In its Flood Assessment Report, Hydrotech conducted a hydrotechnical analysis of the Lands, including reviewing flood modeling associated with the Nicomekl River and applicable regulatory requirements.
Based on this analysis, Hydrotech determined that the Development is located within an area subject to flood risk, including a modeled 200-year return period flood event, and estimated the applicable FCL for the Lands to be approximately 8.8 m, inclusive of freeboard, in accordance with applicable regulatory requirements.
Hydrotech recommended that all habitable areas of the Development be constructed above the applicable FCL and that no enclosed space below the FCL be used for habitation or for the storage of goods susceptible to flood damage.
Hydrotech identified that areas below the FCL, including underground parking and storage areas, are susceptible to flooding during significant flood events.
Hydrotech further identified that flooding of below-grade areas may result in property damage, loss of use of parking and storage facilities, and disruption to building operations.
Hydrotech recommended the implementation of mitigation measures to address flood risk, including design modifications, drainage controls, protective systems, and emergency evacuation plans for residents.
Hydrotech emphasized that, due to uncertainty in weather and climate conditions, flooding constitutes a real and foreseeable risk affecting the Lands and the Development.
In the Flood Assessment Report, Hydrotech expressly confirmed that the Lands are located within the Floodplain and are subject to the Floodplain Elevation Bylaw and concluded that the Lands are exposed to flood hazard.
The Defendants knew, or ought to have known, of the findings and conclusions of the Flood Assessment Report at all material times but failed to disclose it.
On May 2, 2024, the Defendant, 1331603, entered into a covenant, required pursuant to s. 219 of the Land Title Act, with the City, and on the same date registered the covenant against title to the Lands, attaching the Hydrotech Flood Assessment Report.
The registration of the covenant confirmed that the Lands were subject to floodplain-related restrictions and flood risk.
In the second amendment to the Disclosure Statement, dated June 10, 2024, the Defendants, 1331603 and Gosselin, referred to the registration of the covenant in general terms, but failed to plainly disclose that the Lands are located within a floodplain or to correct the prior misrepresentation.
The Defendants, 1331603 and Gosselin, did not correct the misrepresentation in any subsequent amendments to the Disclosure Statement, and the misrepresentation continues to date.
The Defendants, 1331603 and Gosselin, executed the Disclosure Statements.
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