Canada: B.C. Supreme Court orders Vancouver's cannabis dispensaries to shut down

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This morning (December 13), the B.C. Supreme Court ordered all illicit cannabis dispensaries operating in Vancouver to close their doors or face penalties.

In April 2016, the City of Vancouver introduced a medical marijuana–related use (MMRU) model. All existing dispensaries at that time—approximately 100 storefronts—were given until the end of the month to cease operations or face “enforcement action”.

Since then, the city filed 53 injunctions against cannabis-related businesses operating outside regulations—28 of those shops fought back and continued to provide patient access illegally, officially joining Team Black Market. The case, known as the “dispensary test case”, was brought before the B.C. Supreme court in September.

The group of dispensaries were represented by a heavy-hitting team of notable cannabis lawyers: John Conroy, Jack Lloyd, and Robert Laurie. They argued Vancouver did not have the right to licence dispensaries in the first place and in doing so were knowingly aiding, abetting, and profiting from criminal organizations. They also presented a Charter challenge, arguing it unconstitutional to prevent dispensaries from providing direct access and services to Canadians using cannabis for medical purposes.

With today’s ruling, the stores must shut their doors or face penalties, which could range from fines to jail time. To date the city has issued 3,713 tickets totalling close to $3 million against those operating outside the regulations, however it has since harshened its tone.

“This decision reaffirms the city’s authority over land use and our municipal business licensing for cannabis retail, and confirms the regulatory regime introduced in 2015 was well within the city’s jurisdiction to establish,” says Kaye Krishna, general manager, development, buildings and licensing in a release.

“It also signals that any cannabis retail store operating outside city regulations can and will be enforced against using all the tools at the city’s disposal to the fullest extent moving forward.”

Despite recent comments from Vancouver’s police chief Adam Palmer assuring business owners that raids won’t follow swiftly on the heels of the country’s legislative changes, this latest comment indicates a shift in attitude.

“It’s extremely distressing that the City of Vancouver is threatening to close down peaceful business operators that provide a vital service to medical patients and the community,” says Jeremiah Vandermeer on the phone to the Straight. Vandermeer is the CEO of Cannabis Culture, one of the dispensary chains represented in the case.

“Cannabis saves lives and limiting access is harmful and potentially deadly.”

Laurie also expressed remorse shortly after the decision was released on Facebook saying: “I don’t know what to say other than I apologize to medical patients for failing to deliver at this time.”

When asked for comment, Laurie stoicly  replied: “I’ll be back.”

As of October 17—the official date of adult-use cannabis legalization—a shop must have both federal and provincial approval to distribute cannabis sourced from a list of licensed cannabis producers (LP). In order for a dispensary to obtain a business license in Vancouver, however, it must first receive a development permit—the last of which was issued in August of 2015. The application portal for development permits through the City of Vancouver's website is currently closed.

“We would love for our stores to be officially licensed by the city. Unfortunately, the current process does not allow us to take part due to over-restrictive regulations,” says Vandermeer, who is awaiting legal council regarding the next steps for Cannabis Culture.

As it stands, there are only two legal cannabis shops in the province—both of which are located in Kimberly, B.C. As there are no legal storefronts or access points in Vancouver at this point, patients are left only with the option of ordering their cannabis online.

Since the digital retail portal opened in October, licensed producers have been mired with product shortages and recalls. On top of the bottle-neck in online orders, Canada Post’s strike has dramatically stalled delivery times across the country.

Despite ruling in favour of the city’s bylaws, Chief Justice Christopher Hinkson declined comment on the charter argument, leaving the door open to a future federal challenge on the basis of medical access.

The dispensaries now have the option to appeal the decision, close, or challenge the Canadian government directly.

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