Nfld. & Labrador

Did a Newfoundland town really sell its water system?

A town in Newfoundland and Labrador is the focus of what could be an embarrassing legal mistake that led to the unintentional sale of its water supply system.

Ownership dispute causing friction, uncertainty in Wabana

The drinking water dispensing unit in Wabana, N.L., is inside this building. A business owner now says he inadvertently purchased the system from the town, and plans to charge rent of $3,000 a month. (Submitted photo)

A Newfoundland and Labrador town that is no stranger to controversy and friction is once again in the spotlight, with a potentially embarrassing error casting doubt on who owns a critical water distribution system in Wabana.

A business owner who purchased the old firehall on Quigley's Line two years ago says an adjacent system that provides potable water to residents, and the land on which it sits, was inadvertently included in the deal.

Jim Bennett of Beachstone Enterprises wants the town to pay $3,000 in "rent" each month for use of the system and a nearby parking lot.

"The simple truth is that through a series of events, unknown to even me, I have become the owner of the ADWS (advanced drinking water system) unit and the property it sits, and like any business person, I claim that ownership and full rights to that property," Bennett wrote in an Aug. 9 letter to the town.

'It will still be ours,' mayor says

But Wabana Mayor Gary Gosine denies Bennett's claim.

"He's in a dream world," Gosine says.

"We're not just going to give him that building and say we made a mistake. It was ours in the first place. And at the end of the day, it will still be ours."

Several hundred residents of Wabana visit the water dispensary each day to fill containers with clean, treated water. (Submitted photo)

Wabana, a town of roughly 2,500 residents, is on Bell Island northwest of St. John's in Conception Bay.

It has struggled to provide clean, safe drinking water to residents, so a unique treatment system was installed by the province and the town three years ago for more than $300,000.

Anywhere from 200 to 500 residents visit the system each day to fill containers.

Turbulent waters

But the water flowing from the tap is now a little more turbulent, with Bennett claiming to own the system.

Bennett refused to do an interview when contacted Tuesday by CBC News, saying his lawyer advised against it.

But he told the Telegram this week that the town made the mistake, and he's doing what any entrepreneur would do.

"It's on my deed," Bennett told the newspaper. "I bought a manufacturing property and all buildings and erections on it, now and forever, I think the deed goes."

'We're not just going to give him that building and say we made a mistake,' Wabana Mayor Gary Gosine says. (Ted Dillon/CBC)

Bennett delivered a lease agreement to the town in July, demanding $3,000 per month, beginning on Aug. 1, with a $50 penalty for each day the rent is not paid.

He said he has no intentions of restricting public access to the water, and the money is needed to maintain the system.

"The lease agreement in no way was to make any money."

In a further twist, Bennett's company was subcontracted three years ago to construct the building that houses the water system.

Conflicting opinions

So how did this happen? Did the town really sell its water system?

It depends on who you talk to.

"It's our building on our land and right now it's in the hands of the lawyer," says Gosine.

"We'll find out in the next day or so that we own the building and we own the land."

David Brazil, PC provincial representative for Conception Bay East-Bell Island, says his priority is that Wabana residents not be denied access to safe drinking water. (Ted Dillon/CBC)

David Brazil, the Conception Bay East-Bell Island member of the House of Assembly who represents the town provincially, says his No. 1 priority is that residents not be denied access to safe drinking water.

If the system was unintentionally sold to Bennett, Brazil says, the town may have to compensate him, and expropriation may be necessary.

But Brazil doesn't believe the town should pay $3,000 in rent.

"I can't see how that's in the best interest of the taxpayers. I can't see how that's a fair agreement."

Legal action threatened

The law firm representing the town concedes there may have been an "erroneous conveyance," and is threatening Bennett with legal action if he does not agree to a "deed of rectification" that reflects the "true" agreement between Bennett and the town.

"The courts will not look with kindness upon your blatant attempt to extract money from the town by demanding ownership of its only potable water source," lawyer Chris Lewis wrote in an Aug. 7 letter to Bennett.

Lewis wrote it was never the intention of either side to include the water system or the land in the deal.

Meanwhile, the Department of Municipal Affairs issued a statement Tuesday, saying it is "not involved in this issue."


Terry Roberts is a reporter with CBC Newfoundland and Labrador, and is based in St. John’s. He previously worked for The Telegram, The Compass and The Northern Pen newspapers during a career that began in 1991. He can be reached by email at: