Musqueam lose fight to tax Shaughnessy golf club as residential land

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

Since 1991 golf club has been paying property tax directly to the band

Sean O'Hair, of the United States, centre, celebrates his tie breaker win over Kris Blanks of the United States during the final round at the Canadian Open PGA golf tournament at the Shaughnessy Golf Club in Vancouver, B.C., on July 24, 2011. (Jonathan Hayward/The Canadian Press)

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

The decision is a huge financial win for the Shaughnessy Golf and Country Club, which has leased the prime 162 acres of reserve land in southwest Vancouver since 1958.

Since 1991 the golf club has been paying property tax directly to the band.

In 2011, the band appealed an assessment of the property as a golf course, contending that property tax should be calculated based on its "highest and best use."

The fight led the Musqueam first to B.C. Supreme Court and then to the B.C. Court of Appeal, where the band argued the lease limiting the property for use as a golf course was entered into by the Crown, not the band.

The band argued it didn't negotiate the original lease with Shaughnessy in the 1950's, and thus should now be able to change the way property tax is assessed.

Back then, the lease was negotiated by the Crown on the band's behalf because the band was not allowed to sign its own lease.

But lower courts found the Crown was "acting on behalf" of the band when it limited the use of the land.

On Friday the Supreme Court Of Canada upheld that decision.

"While the surrender document makes no mention of the lease or the club, the context in which the surrender occurred and the lands were demised clarifies that [the] Musqueam intended that the lands be leased to the club. Given that context, the use restriction in the lease was placed 'by the band'," said the SCOC decision.

Future speculation

The Shaughnessy course is ranked as one of the best in Canada and has hosted the Canadian Open four times. But the club's lease on the land ends in 2033 and it is expected the Musqueam will develop the land after that.

The golf club purchased a course in Richmond for a possible move, but there has also been unconfirmed speculation that the club may take over the public University Golf Course in nearby Point Grey, which was turned over to the Musqueam band in 2007, with a requirement that it remain a golf course until 2083.

Canada's David Hearn, of Brantford, Ont., hits out of a bunker on the 5th hole during round three at the Canadian Open PGA golf tournament at the Shaughnessy Golf and Country Club in Vancouver, B.C., on July 23, 2011. (Darryl Dyck/The Canadian Press)