Landowner sues RM for $15M after land repossessed

A landowner who wanted to create a cottage development next to Lake Manitoba is suing the Rural Municipality of Alonsa for $15 million for repossessing the property and breach of contract.

In a statement of claim filed in Manitoba Court of King’s Bench this month, Blair Chad Olafson, Brandee Olafson, Narrows West Land and Cattle Company, and Narrows West Developments accuse the municipality, Reeve Tom Anderson and two councillors, as well as the municipality administrator, of conduct that was “high-handed, malicious and an abuse of statutory authority.”

The lawsuit alleges the Olafsons have suffered damages, including mental distress, reputational harm, lost profits, loss of development opportunity and increased construction and financing costs.

Olafson and his lawyer could not be reached for comment. Alonsa Reeve Tom Anderson did not respond to messages.

No statements of defence have been filed and the matter has not been tested in court.

The lawsuit does not include any dates about when the allegations occurred.

A Free Press story in 2018 detailed how Chad Olafson, the son of the former owners of the Narrows West Lodge, along with his Narrows West companies, were facing at least two dozen lawsuits in 2016, connected with the cottage development and golf course he had planned at the site, which is 190 kilometres northwest of Winnipeg.

Sixty-one empty cottage lots were scheduled to go to tax sale so the RM could get back $350,000 in property tax arrears, but the sale was called off when Olafson struck a repayment schedule.

A tax sale was scheduled again in 2019 when the arrears hadn’t been paid in full.

It’s not known what has happened to the site since then.

But the lawsuit claims the Olafsons and the companies entered into a development agreement with the municipality that proposed to turn the property into “a seasonal recreation residential zone.”

The lawsuit alleges that after the agreement was made, the municipality and the others “deliberately refused to honour and implement the contracts.”

“The Rural Municipality retained the benefit of the plaintiffs’ expenditures and improvements, while denying the plaintiffs the benefit of the contracts allowing for development.”

The suit alleges the land wasn’t immediately developed by the Olafsons and the companies because of “catastrophic floods to the area.”

The plaintiffs claim the municipality “wrongly repossessed certain lands… and subsequently proceeded to sell said lands to third parties, and/or allow for further sales between third parties, in breach of contract.”

As well, the lawsuit claims the municipality also contacted people who had bought cottage lots, including owners outside of Canada, to encourage them to “back out of their sale.”

The court documents allege these lot owners had also been planning to invest in a proposed hotel and golf course in the area, but after the municipality contacted them they “were no longer interested in said investments.”

kevin.rollason@freepress.mb.ca