The following are excerpts from:
A Handbook for Municipal Councils
Under the Community Charter
and the Local Government Act
Just remember this: you are elected to govern in the interests of the entire community, not to further your personal interests. Surely you want the community to remember you for what you contributed to it and not for what you took out of it.
A municipal council must know its legal limits before taking certain actions, for example, spending money on municipal services and other matters; enacting bylaws and passing resolutions to govern the conduct of its citizens; imposing taxes, fees and charges; disposing of its assets; and controlling property rights.
Typically, municipal officers have a good general knowledge of the limits on general powers and of the specific areas that they work in. Where there is any doubt, the municipal solicitor should be consulted for advice. This is also true for activities that are novel, complex or contentious or where council is averse to risk.
Consequences of Illegal Acts
The consequences of a council taking any ultra vires (Latin for "beyond the law") action without having the necessary power to do so are serious. Such actions expose the municipality to litigation that can be very costly and often unnecessary. The Courts can declare bylaws invalid and award financial damages to persons who have incurred them because of unlawful actions by Council.
The costs can add up: in addition to paying damages, there are court costs and the fees of opposing counsel as well as the municipality’s own. There is also the administrative downtime to be considered. Of course, all of this falls on the taxpayers so the effects can be political, as well.
In some cases an illegal act by a Council can result in a lawsuit against its individual members. For example, section 191 of the Community Charter states that a council member who votes for a bylaw or resolution authorizing the expenditure, investment or other use of money contrary to that Act is personally liable to the municipality for the amount, unless the council member relied on information supplied by a municipal officer or employee who was guilty of dishonesty, gross negligence or malicious or willful misconduct in that regard. The money may be recovered for the municipality from the council member, who will also be disqualified from holding office.
Note: I have inserted section 191 of the Community Charter for your information.
191 (1) A council member who votes for a bylaw or resolution authorizing the expenditure, investment or other use of money contrary to this Act or the Local Government Act is personally liable to the municipality for the amount.
(2) As an exception, subsection (1) does not apply if the council member relied on information provided by a municipal officer or employee and the officer or employee was guilty of dishonesty, gross negligence or malicious or willful misconduct in relation to the provision of the information.
(3) In addition to any other penalty to which the person may be liable, a council member who is liable to the municipality under subsection (1) is disqualified from holding local government office for the period established by section 110 (2).
Legislative Origins of Local Government
Local government has no original legal capacity, i.e. no power to self-incorporate, but is a "creature of legislation". Municipal corporations are created by the provincial government, by a formal Act of the Legislature or by Letters Patent issued by the Lieutenant Governor in Council (the Cabinet).
A local government in British Columbia is more often incorporated by the issuance of Letters Patent. These establish the boundaries, the size of the Council and a number of start up matters, such as the timing of the first election. Some incorporation occurs by an Act, e.g. Resort Municipality of Whistler.
Forms of Local Government
In B.C., local government takes the form of cities, towns, villages, districts, regional districts and improvement districts. Separate Acts govern other forms of local government, such as school boards and greater water and sewer boards. Section 17(1) of the Local Government Act
classifies municipalities as follows:
17 (1) A municipality must be incorporated as follows:
(a) as a village, if the population is not greater than 2 500;
(b) as a town, if the population is greater than 2 500 but not greater than 5 000;
(c) as a city, if the population is greater than 5 000;
(d) despite paragraphs (a) to (c), as a district municipality if the area to be incorporated is greater than 800 hectares and has an average population density of less than 5 persons per hectare.
While local governments do have legislative powers, i.e. the ability to pass bylaws, those powers are limited to the powers granted by the Legislature by way of statutes, such as the Community Charter, and other forms of legislation, such as orders in council.
Local governments now have “natural person” powers and some of the powers that corporations have generally, but of course, natural persons and ordinary corporations do not have legislative, taxation or regulatory powers. The provincial government must specifically grant these powers
to local government.
The Community Charter
The Community Charter came into force on January 1, 2004 and replaced the Local Government Act, in respect of the establishment of the purposes, powers and governance of municipalities.
There is a misconception that the Community Charter sets no limits on municipal powers and hat anything goes. Not so! There are many limitations in the Charter and the so-called “broad powers” have yet to be tested in the courts. Even the “natural person” powers, as applied in
other provinces, are still relatively new and untested. In the taxi case out of Alberta, the Alberta court used the old rule of interpretation that a power has to be expressly granted, but the Supreme Court of Canada overturned this in favour of the “broad powers” approach.
The Local Government Act
The Local Government Act continues to govern the incorporation procedures of local governments, amalgamations and boundary changes. It also governs the incorporation of and the purposes, powers and governance of regional districts and improvement districts. It continues to contain the procedures for local government elections, including referenda, as well
as the powers and procedures for community development (planning and zoning).
Be aware that there are many other provincial statutes and numerous regulations affecting local government, for example:
Financial Disclosure Act
Freedom of Information and Protection of Privacy Act
Motor Vehicle Act
Environmental Management Act
Fire Services Act