The City of West Kelowna was entitled to cancel two cannabis dispensaries’ business licences, a B.C. Supreme Court judge found on July 4. The city was awarded its legal costs and now it will pursue further legal action against Black Crow Herbals Association and Okanagan Cannabis Solutions Society to collect fines totalling $74,000 and $76,000 respectively.
“The city originally sought a court order to close down these two dispensaries after they refused to comply with the Business Licence Bylaw and the Zoning Bylaw,” communications supervisor Kirsten Jones said in a statement.
In response, the two pot shops challenged the validity of the bylaws.
“The dispensaries also argued that because they had been operating before the bylaw changed, they ought to be permitted to continue as a lawful nonconforming use,” Jones said.
Black Crow obtained a business licence from the City of West Kelowna in October 2014—four years before the federal government legalized the recreational use of marijuana. The shop, which was registered under the provincial Societies Act, operated the retail storefront on Westgate Road, while its second location, the Okanagan Cannabis Solutions Society operated on Main Street with no business licence.
It was registered as a non-profit society, as non-profits do not require business licences from the city.
Mike Cain, a senior bylaw officer for the City of West Kelowna, said Black Crow’s October 2014 licence application did not say it was a retailer, but rather a compassion club.
“We are a private compassion club dedicated to providing safe access to medical marijuana to qualified patients,” the application read. “We also provide information, literature and doctor referrals.”
In October 2017, city council stripped the store of its business licence based on a staff recommendation, as the store was operating contrary to the Criminal Code and several city bylaws. A letter was sent to Black Crow less than a week later warning the operators that enforcement action would follow if the retailer continued to keep the shop open.
But that’s what it did. Cain followed up with both the store and the society and in early November 2017, observed they were both still operating.
The dispensaries, as they described themselves, reapplied for business licences a month later on Dec. 18, but Cain denied them as they were still in breach of the Criminal Code.
When the case was brought to the B.C. Supreme Court, the city sought payment for the marijuana retail outlets’ “flagrant disregard” for the bylaws, including zoning bylaws.
The court said the city would have to apply for an enforcement order if necessary and the Black Crow and Okanagan Cannabis’ petitions were dismissed.
The judge declined the City of West Kelowna’s order for special costs.
“There is no suggestion here that there was misconduct in the litigation,” the judge wrote in the decision. “As to the flouting of the bylaws, the city itself played at least some role, for a time, in leading the respondents to believe they could carry on business as they did, and the points raised by the respondents were not frivolous.”
The courts awarded the city the legal costs—a total that has yet to be determined—but the city isn’t done yet.
“The city will be pursuing legal action to collect the fines due stemming from a separate legal action against these two businesses,” Jones said. “The total fines are $74,000 for Black Crow and $76,000 for Okanagan Cannabis Solutions.”