The Property Controls for Grocery Stores and Supermarkets Act
Manitoba is a taking the provincial lead in the "public interest" that there should not be any restrictions, either directly or indirectly that restricts the use of land for a grocery store or a supermarket.
Bill 31, The Property Controls for Grocery Stores and Supermarkets Act, received Royal Assent on June 3rd of this year and is in force. The gist of the Bill is that going forward, exclusivity clauses or restrictive covenants that restrict, directly or indirectly, the use of land for a grocery store or supermarket (a "property control") are void. To the extent that a property control currently exists, it can be "preserved" by either filing a caveat (if a caveat had not previously been registered) or, if a caveat has already been filed, filing a memorandum of agreement to confirm or modify the property control. A new form of memorandum of agreement has been prescribed for this purpose. That said, if a property control is "preserved", it remains subject to review by the Municipal Board to determine whether it is contrary to public interest.
As has been reported in the media, a number of grocers are no longer enforcing their existing property controls and will not be seeking such controls going forward (while Manitoba is the first Province to have specific legislation, the Competition Bureau has stepped up its policy of viewing grocery restrictions as offside the Competition Act).
Sometimes a property control is registered as a stand-alone instrument. However, a property control is often part of other bundles of interests in land, such as a lease or a reciprocal easement and operating agreement. Even if a party chose not to enforce its property control going forward, the impact of the legislation is that a caveat that includes a property control along with other valid interests in land (e.g., lease, easements) will be discharged unless a new Memorandum of Agreement to Amend Existing Registration – Form 34 (a "New MOA") is filed in the Property Registry to preserve those interests. Having an otherwise valid caveat discharged has a number of possible implications, not the least of which is priority of registration.
Under the legislation, a New MOA must be submitted for registration with the Property Registry within 180 days and the registration must be accepted for registration within 210 days of the Bill coming into force.
If you happen to be a business or a property owner that has the benefit of a current property control there is an extreme risk of losing otherwise valid registrations due to a property control being caught by this Bill, we thought that we should bring this legislation to your attention.
While the foregoing is a brief overview, the legislation needs to be reviewed for your specific circumstance as there are, for example, some exemptions in the legislation that may be applicable as well.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
