The B.C. Court of Appeal has quashed the provincial government's last hope of throttling a potential avalanche of third-party advertising in the days leading up to start of the election campaign.

Justice Peter Lowry refused Friday to grant a stay that would have suspended last week's B.C. Supreme Court judgment throwing out spending limits on third-party advertising in the 60-day pre-election period as unconstitutional.

The government has served notice it wants to appeal Justice Frank Cole's decision but the case likely won't be heard until later this year, well after the May 12 election campaign is over.

Craig Jones, a lawyer for the Attorney General's Ministry, argued the stay was necessary because lifting the ceiling on ad spending put some groups at a disadvantage.

Cole last Friday quashed the section of the B.C. Election Act that restricts third-party spending during the campaign and the two months preceding it to $150,000 for groups and $3,000 for individuals.

But he upheld that ceiling for the 28-day campaign itself, reasoning partisan groups should not have access to unlimited funds when political parties were subject to strict limits.

Jones said the effect of the ruling was to triple the amount third-party groups could spend during the month-long election campaign itself, which starts when the writ is dropped April 14.

It also penalized groups that played by the rules and planned to spread their spending over the two-month pre-election period and the campaign.

They would be up against groups that were spending freely in the run-up and would still have $150,000 available during the campaign, Jones said.

But Lowry sided with the labour unions that had challenged the law originally and fought the government's attempt to stay implementation of Cole's ruling.

Their lawyer, Joe Arvay, told Lowry that Cole ruled the spending restrictions were an unconstitutional infringement on free expression, putting a heavy burden on the government to show that implementing the ruling now would cause irreparable harm.

"It's a stretch at the best of times to claim that expression is harmful," he said.

In his ruling, Lowry said the government's argument that some groups might be disadvantaged was not without some merit, but not to the extent that lifting the limits for the final few days before the writ is dropped would impair the election's fairness.

"In my view the interests of justice do not require denying the plaintiffs the benefit that remains to be taken out of their successful challenge of the impugned legislation," Lowry said.

Jones had already conceded the government could not object to advertising bought by unions and other groups since Cole's original ruling. Those ads would run regardless of a stay, he said.

The B.C. Teachers Federation has booked $275,000 in TV spots, the Canadian Union of Public Employees $75,000 in newspaper ads and the B.C. Nurses' Union was considering $60,000 in regional newspaper ads, the court heard.

The Independent Contractors and Businesses Association of B.C., which was paying legal costs for two dissident union members backing the government's position, has also been active in advertising since Cole's ruling.

Deep pockets

The government had argued the law was necessary to ensure groups with deep pockets didn't drown out other voices immediately before and during an election campaign.

The concept is enshrined in past decisions by the Supreme Court of Canada on spending limits during the 1995 Quebec referendum and for federal campaigns.

The B.C. Civil Liberties Association said it was pleased with Lowry's ruling and criticized the government for trying to put in the restrictions in the first place.

"People should celebrate the fact that issues that concerned citizens and groups want to have put on the public agenda will now get heard," said association president Rob Holmes.

B.C.'s next provincial election is scheduled for May 12.