Kelowna Airbnb owner denied permit loses appeal in court

An Okanagan man, who ran a short-term rental business for the last 15 years, has lost a legal challenge against the City of Kelowna after it refused to renew his business licence.

Dennis Axle Hildebrand had filed for a Judicial Review at the BC Supreme Court, arguing that City of Kelowna staff should not have denied his request to renew his business licence, a move that was supported by city council.

According to a Jan. 16 BC Supreme Court decision, Hildebrand had owned the Bernard Avenue property since 2010 and let out its seven studio apartments as short-term rentals.

In 2021, he forgot to pay his annual $35 fee to renew his business licence. By the time he was alerted to his mistake, he’d missed a cut-off period and was told to reapply for a license.

However, when he went to reapply for the business licence, the zoning had been changed, which prohibited short-term rentals in the area.

To add to his woes, in mid 2022, someone complained about the property being used for short-term rentals and advertised on Airbnb. They also complained about a shipping container in the laneway and an exterior railing and stair additions, which had been done without permits.

Due to the complaint, city staff began to investigate and realized that the units Hildebrand rented out had kitchens, which wasn’t allowed under the old zoning either.

City staff realized they should not have been giving him a business permit in the first place.

“In follow-up calls with staff, Mr. Hildebrand was told his prior rooming house licences should not have been issued because they were incompatible with (the) Bylaw… and (the new) Bylaw did not permit short- or long-term rental of the seven units,” the decision reads.

This discovery kiboshed any hope that Hildebrand could have his business licence grandfathered in under the old zoning rules.

He took the matter to Kelowna council for reconsideration, but councillors ultimately rejected his plea that his business licence should be granted.

The decision says staff did offer Hildebrand a business licence for long-term rentals but he refused.

Hildebrand argued it was “unreasonable and procedurally unfair” not to grant him a business licence.

However, Justice Simon Coval disagreed.

“It was not unreasonable to reject Mr. Hildebrand’s position that it was (the new) Bylaw… that had made his business unlawful. It was already unlawful under (the old) Bylaw. It was therefore not unreasonable for staff to recommend upholding the decision not to grant the licence, and for Council to do so,” the Justice said.

Ultimately, the Justice dismissed his appeal.

The decision says that despite his lack of business licence, Hildebrand continues to use the property for short-term rentals.

His ad for Kelowna Art Lodge on Airbnb is active, with the last review being in September 2025. It also appears possible to book a stay come February.