Paul Bickford/NNSL photo
A land lease dispute in Hay River is pitting a business against the town and a territorial department.
The dispute has its origins in 2017 when businessman Jeff Griffiths sought to lease a lot of territorial land at the corner of Studney Drive and Poplar Road.
Griffiths followed proper process and submitted an application to the Town of Hay River, which sent it to the Department of Lands. The town was to obtain the head lease, and sublease to Griffiths.
But since then, that original application was returned to the town, which was a mistake according to the department. Griffiths submitted an application directly to the department in 2019. The town followed not long afterwards with an application for the same land. The Department of Lands determined the original 2017 application should take precedence, and a process is now nearly complete that would lease the land to the town.
However, if it is successful in leasing the land under the 2017 application, the town intends to use the land itself to build a sewer lift station, and not sublease to Griffiths.
That has left Griffiths objecting to the process.
"I had two applications with fees paid, both prior to the town's application," he said, “and the territorial Lands Act is on a first-come, first-served basis."
Griffiths noted the town never returned a $150 fee from 2017.
"The town received the $150 back from the Government of the Northwest Territories, and then they asked if I wanted my money back or if I just wanted to have that held and then have that resubmitted with the application," he recalled, "I said, 'No. We'll just resubmit that with the application.'"
Griffiths said the town's 2019 application should have been rejected immediately.
"The government has got to follow the legislation," he said. "I don't see how it's optional in this case."
Griffiths hopes to use the 60,000-square-foot lot for his Trade Show Direct, which primarily rents special event equipment.
However, on June 2, town council approved a $5.8-million tender to build the lift station, even before officially obtaining the land.
The Department of Lands is currently conducting consultations with Indigenous government organizations as the final step to possibly leasing the land to the town.
Glenn Smith, the town's assistant senior administrative officer, confirmed the 2017 lease application on behalf of Griffiths was returned by Lands in February 2018, along with the $150 fee.
"They indicated that they were unable to process the application and that it was being returned," Smith said, adding the department explained it was doing research on the land.
Smith said the town later began to study and design a new lift station, required primarily for a planned fish processing plant.
"So through that work, we had to identify a location for that lift station to be built, and it's really a critical location where that land is," he said, noting it's at an intersection of several key mains. "So that's why it's an ideal location."
Plus, Smith said it would cost up to an estimated $1 million to locate the lift station elsewhere.
Blair Chapman, assistant deputy minister of operations with the Department of Lands, admitted there was a research mistake by the department when the original application was received.
The researchers felt the parcel of land had not been transferred at devolution because of how it was registered with land titles, Chapman said.
"Unfortunately, that was a mistake that was made by the department. And because they felt that it hadn't transferred, they felt that they couldn't administer the land, so they returned the application to the Town of Hay River."
It was later determined the land actually was under GNWT control and it could deal with a lease application.
According to Chapman, Griffiths discussed the issue with Lands and it was suggested he put forward his second land application in 2019, and the town put in a subsequent application because it felt its initial application should not have been returned.
"So we sat back and looked at all the various facts," said Chapman. "If you were to go back to the original application a) it should have been accepted, b) it should have been consulted upon, and c) we would have been at a point where we could have made a determination as to whether we would enter into a lease or not. So we felt that it would have been inappropriate to action Mr. Griffiths' (second application). From that standpoint, we felt that the original person – first past the post, if you want to call it that – was the Town of Hay River applying for this parcel of land, and so that's why we went back to suggest that it's their application that we needed to consider on a go-forward basis."
Chapman was asked why the lease is now going to the town when the original application by the town was on behalf of Griffiths.
The assistant deputy minister explained the department's relationship is only with an applicant, not a sub-applicant.
The department is trying to "right a wrong" caused by the return of the original application, he said. "And yes, things got very complicated after that."
Chapman believes there could be a solution agreeable to both Griffiths and the town, and the department will reach out to both parties after the consultation period is complete in mid-July.
A number of previous ideas on sharing the land have not been successful.
Griffiths has filed a complaint over the land lease issue with the NWT's Office of the Ombud.
Chapman noted that the consultation process couldn't have begun over a year ago, as suggested by some on town council, because complete information for the application wasn't submitted by the Town of Hay River until February of this year.