In Saint John(City) v. Irving Oil Co [1966] SCR 581, Irving Oil, owned a gas station on land that the City of Saint John lawfully expropriated. The City offered $20,500 in compensation for the expropriation. Irving Oil wanted $36,000. An arbitrator was appointed. He heard evidence from the City which included an expert appraisal.
The appraiser came to his professional opinion by using only hearsay evidence of private estate sales to public authorities. The expert gathered his data through personal discussions with estate trustees, who apparently described their respective sales and sale prices, all of which was not public information.
In other words, the expert did not use the regular process of gathering data that had been sifted through an open market process where multiple demanders and suppliers competed openly over price. The meaning of ‘open’ market, is precisely that the price can be seen to move up and down, property by property, as numerous unrelated parties bid. Prices, in the main, can be seen. Price per square foot can be proxied using open market data.
This is precisely the data that was missing from the City expert report. So the SCC was here dealing with the familiar question of admissibility of an expert report built upon hearsay.
Although Richie J.A. at the New Brunswick Court of Appeal would have deemed the expert report inadmissible because of the degree of infection by hearsay, the SCC would have admitted the opinion and the hearsay component would go to weight.
Take-away #1: attacking an appraiser’s report because it is built upon hearsay is viable tactic but it will not prevent admissibility.
Take-away #2: subsequent expert opinion jurisprudence has not altered this SCC approach to the admissibility of expert opinions other than to require that the expert opinion must not be based entirely upon hearsay. Some of the foundation must be admissible non-hearsay evidence.
