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Marihuana Dispensaries

A comprehensive guide to the legal status, enforcement, and regulation of marijuana dispensaries. Covering topics such as criminal law, business licensing, zoning, and enforcement mechanisms. Stay informed on the evolving legislation surrounding the sale and possession of marijuana.

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Marihuana Dispensaries

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  1. Marihuana Dispensaries Don Lidstone, Q.C. Lidstone & Company Barristers and Solicitors AKBLGAnnual Conference June 16, 2016

  2. Overview • Legal Status of Dispensaries and Marihuana possession/production generally • Enforcement/Regulatory options • Criminal law • Business Licensing • Zoning • Mechanics of enforcement • Tips and Tricks

  3. Legality of Marihuana Dispensaries • They’re not! • Controlled Drugs and Substances Act: Possession of substance 4. (1) Except as authorized under the regulations, no person shall possess a substance included in Schedule I, II or III. • Cannabis, including marihuana, is a Schedule II substance • Only lawful access to marihuana at present is by way of the MMARs or MMPRs

  4. MMARs • Enacted in 2001 • MMARs allow for production/possession as follows: • ATPs: authorization to possess • PPLs: personal-use production licence • DPLs: designated-person production licence • Only at the production site and area authorized in the licence (including residences) • No provision for retail sale in the MMARs

  5. MMPRs • In force in July 2013 • Existing ATPs, PPLs, DPLs to expire March 31, 2014 • Then, commercial producers licensed under MMPRs may distribute to authorized users via: • secure shipping (primary mechanism); or • pharmacist, authorized health care practitioner, hospital (purchased from licensed producer: “Authorized Distributor”) • No provision for retail sale

  6. Constitutional Challenge to the MMPRs: Allard v. Canada • Federal Court decision March 21, 2014 • Interlocutory Injunction granted • Effect: • people with ATPs, PPLs or DPLs granted under the MMARs may continue to use those pending determination of constitutionality of MMPR regime

  7. Allard round 2 • Federal Court decision February 24, 2016 • MMPR’s: no force and effect (infringe constitutional rights medical marihuana users) • Declaration suspended 6 months enable Feds to adopt new regs • Justice Manson order of March 21, 2014, preserving rights under the MMAR regime, remains in effect • Feds not appealing

  8. Current state of the law • Until earlier of new fed regsor August 24, 2016 • legal to possess marihuana pursuant to an MMAR licence • legal to possess marihuana pursuant to an MMPR licence or authorization • Neither MMARs nor MMPRs permit retail sale of marihuana. • Dispensary business selling marihuana from store front operating contrary to Controlled Drugs and Substances Actand unlawful

  9. Enforcement/Regulation 1. Criminal Law: • Police raids - Examples: • April 2015: Parksville • July 2015: Edmonton • January 2016: Toronto • April 2016: Campbell River, Chilliwack x 2 • Police warnings- “voluntary closure” in Grand Forks

  10. Health Minister Jane Philpott delivered an impassioned speech at a UN special session on drugs on Wednesday, where she announced Canada will introduce legislation next spring to spark the process of legalizing and regulating marijuana. … Liberals to unveil marijuana legislation next year United Nations — The Canadian Press Published Wednesday, Apr. 20, 2016 10:49AM EDT

  11. Enforcement/Regulation (cont’d) 2. Business Licensing Regime • Many business licence bylaws already prohibit the licensing of dispensaries • Require compliance with all applicable regulatory requirements (including federal) and proof of applicable certifications, approvals • Provisions like these in bylaws can enable the refusal of licences for dispensaries (for now) • Dispensaries operating without licences can be subject to enforcement

  12. Abbotsford (City) v. Weeds Glass & Gifts Ltd., 2016 BCSC 135 • Facts: • Dispensary applied for business licence, City because dispensary not comply with B/L bylaw. Dispensary opened, operational despite warnings/ demand letters • City sought injunction • Ruling: • Injunction issued. City had established breach of B/L bylaw. No extraordinary circumstances warranted refusal of injunction • Dispensary closed since order took effect • Appeal filed (but stay of order refused)

  13. Enforcement/Regulation (cont’d) 3. Business Licensing Regime - Vancouver • Requirements to operate: • DP and a B/L • In a commercial zone • At least 300m from schools, community centers, neighbourhood houses, youth facilities that serve vulnerable youth, other marihuana-related businesses • Fee – B/L fee for compassion clubs is $1,000, $30,000 for medical marihuana retail dealers • Sign good-neighbour agreement

  14. Enforcement/Regulation (cont’d) • Current Practical Reality in Vancouver • More than 100 dispensaries without required permits • Up to 40 dispensaries being licensed • City had a ‘grace’ period for all dispensaries which expired end of April 2016 • Started ticketing in May (violators face fines up to $750)

  15. Three large jars full of marijuana buds sits on the counter at VanCity Weed, a Robson Street dispensary that plans to stay open beyond a Vancouver city deadline. (Rafferty Baker/CBC) Deadline looms for 100-plus pot shops while 100s more line up to open Marijuana dispensaries in violation of new city bylaws must close by Friday or face fines CBC News Posted: Apr 26, 2016 8:09 PM PT Last Updated: Apr 26, 2016 9:11 PM PT

  16. Enforcement/Regulation (cont’d) Business Licensing Regime • Limitation: statutory power to regulate business not include the power to prohibit (most) business • Prince George (City) v. Payne, [1978] 1 S.C.R. 458 • Common Exchange Ltd. et al v. City of Langley, 2000 BCSC 1724 • Once marihuana legalized (if retail sale of marihuana also legalized), business licence bylaws may be rendered ineffective as a means of precluding dispensaries

  17. Enforcement/Regulation (cont’d) 3. Use of Zoning Powers • power to zone includes power to prohibit any use • Courts have upheld prohibitions on body rub parlours, casinos, pawn shops • Constraints • Conflict with federal law (not likely problem as long as marihuana illegal) • Constitutional rights of users (complete ban on dispensaries throughout every zone may impermissibly interfere with rights of users)

  18. Mechanics of Enforcement • Tickets, bylaw notices • Statutory injunction: s. 274 of the Community Charter • once prove breach of the bylaw, will almost always be granted • Civil burden of proof, faster process • Can be costly • Offence Act prosecution • Quasi criminal, can impose punitive fines • Higher burden, trial with live witnesses, resource intensive

  19. Tips and Tricks - Bylaws • Business licence bylaws should: • broadly define business • require business licence even if a dispensary is operated by a society or on non-profit basis • Zoning Bylaws should: • broadly define and prohibit marihuana operations • particularly until the new federal regime • tailor zoning thereafter

  20. Tips and Tricks – Bylaws (cont’d) • Both Business and Zoning Bylaws should: • require dispensaries to comply with all applicable bylaws as well as provincial and federal laws • Section 15(2) of the Community Charter enables municipalities to adopt provincial or national requirements • Provide each day of violation is separate offence • be designated as enforceable by bylaw notice and ticket with significant fines (max $500, $1000)

  21. Tips and Tricks – Enforcement • To shut down dispensaries: • Progressive enforcement (warnings, demand letter, tickets/BON’s, then injunction) • Issue tickets/BON’s to landlords • Successful in Abbotsford • Each owner can be fined separately R. v. Morshedian and Janani, 2015 BCPC 368

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