What if due diligence shows the business is a legal non-conforming use?

A zoning check can come back saying the current use is not permitted today but is “grandfathered”. That is a claim to confirm, not a conclusion. In the three provinces described below, the protection comes from the provincial planning statute, and each statute attaches conditions. For any other, ask your lawyer or the municipality.

What three provinces’ statutes say

Ontario’s Planning Act, s. 34(9)(a), says a zoning by-law does not prevent the use of land, a building or a structure for a purpose the by-law prohibits if it was lawfully used for that purpose on the day the by-law was passed, so long as it continues to be used for that purpose. Section 34(9)(b) gives similar protection to a building or structure for which a Building Code Act, 1992 permit was issued before the by-law was passed, so long as, when erected, it is used and continues to be used for the purpose for which it was erected and the permit has not been revoked. British Columbia’s Local Government Act, s. 528, subject to that section, lets a use that was lawful when a land use regulation bylaw was adopted, and does not conform to it, continue as a non-conforming use, and says a discontinuance for a continuous period of 6 months makes any later use subject to the bylaw; s. 528(3) says seasonal or agricultural uses are not discontinued by normal seasonal or agricultural practices. Alberta’s Municipal Government Act, s. 643(2), says a non-conforming use of land or a building may be continued, but if it is discontinued for a period of 6 consecutive months or more, any future use must conform with the land use bylaw then in effect. The Ontario provision quoted here sets no discontinuance period.

Ownership and expansion

British Columbia and Alberta both say a change of ownership does not by itself affect the use. British Columbia’s s. 534 says a change of owners, tenants or occupants does not, by reason only of the change, affect the use. Alberta’s s. 643(7) says the land use or the use of a building is not affected by a change of ownership or tenancy. Both also limit growth. In British Columbia, s. 530 says that for land, s. 528 does not authorize continuing the use on a greater scale, extent or degree than when the bylaw was adopted, and s. 531 generally bars a structural alteration or addition to a building or structure while the use continues, subject to exceptions. Alberta’s s. 643(3) to (5) limit enlarging, adding to, rebuilding and structurally altering, with exceptions. Both Acts also bar repairing or rebuilding a non-conforming building damaged beyond a set share of its value, except in accordance with the bylaw: British Columbia’s s. 532 and Alberta’s s. 643(6).

What a buyer asks for

• A written statement from the municipality of the property’s status, such as a zoning compliance letter, and what it covers. The City of Kitchener, for one, says that if you are buying, selling or mortgaging a property you may need such a letter.
• Evidence the use has run without a gap, such as licences, utility records and dated sales records, so any discontinuance period in the applicable statute, such as the 6 months in British Columbia’s Local Government Act, s. 528(2), and Alberta’s Municipal Government Act, s. 643(2), can be checked.
• The seller’s disclosure of any plan, past or present, to expand, renovate or change the use.
• Whether the buyer’s own plans, or a lender’s conditions, fit within the continued use. See how to check municipal zoning compliance.