Musqueam Indian Band golf course case heads to Supreme Court of Canada

The Musqueam Indian Band is headed to the Supreme Court of Canada in a bid to tax the Shaughnessy golf course based on its worth as residential land.

Band wants the right to tax Shaughnessy golf course based on its value as residential land

Anthony Kim plays in the 2011 RBC Canadian Open, one of many tournament's staged at the elite Shaughnessy Golf & Country Club in Vancouver. ((Harry How/Getty Images) )

The Supreme Court of Canada has agreed to hear the Musqueam Indian Band's bid to force one of Vancouver's most elite country clubs to pay residential-level property tax on golf course land.

The case has massive financial implications for the tony Shaughnessy Golf and Country Club, which has leased the 162 acres of reserve land since 1958.

The Musqueam want the right to collect property tax on the course, which occupies a prime piece of southwest Vancouver realty, based on its value as residential real estate.

'Fiduciary duty'

The issues at stake in the case have already been before the SCOC, which awarded the Musqueam $10 million in 1984 as compensation for the deal the Crown negotiated in leasing the land on the band's behalf.

The band is not allowed to lease reserve land. And so it surrendered the land in the 1950s to the Department of Indian Affairs, which in turn entered into a 75-year lease with the golf club.

The earlier SCOC case was a landmark ruling which established that the Canadian government has a fiduciary duty to First Nations. The Crown failed the Musqueam by entering into a lease with the golf club which was far below fair-market rent for the land.

The golf club has been paying property tax directly to the band since 1991. But in 2011, the band appealed an assessment of the property contending that it should be calculated based on its "highest and best use."

In Vancouver's super-heated real estate market, that would put the residential value of the land sky-high.

The fight led the Musqueam first to B.C. Supreme Court and then to the B.C. Court of Appeal.

Decisions at both levels established that there is a restriction on the land and that — crucially — the restriction was "placed by the band."

The band contends that the lease restricting the property for use as a golf course was entered into by the Crown. But the Appeal Court found the Crown was clearly "acting on behalf" of the band when it limited the use of the land.

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