The controversial smoking bylaw could cost the city $5.6 million if a lawsuit filed in Yukon Supreme Court on Thursday is successful.

The suit, filed by Paul Douglas, owner of The Coffee Bar in Marwell, is against the city, Mayor Ernie Bourassa and council, city administration and the city's bylaw enforcement department.

Douglas claims 'an unfair operational implementation of ... the no-smoking bylaw.'

He argues the bylaw lets bars operate as restaurants or coffee bars. The bars let their clients smoke, whereas the restaurants and coffee bars must abide by the bylaw, the documents say.

'The argument is that restaurants/coffee bars cannot be competitive as the bylaw is unfair,' the document says.

In addition to the $5.6 million, the Marwell coffee bar and gas station is suing for claims interest and costs.

Last year, city council passed an amendment to the smoking bylaw which banned smoking in all public places. Except for bars, the bylaw took effect Jan. 1. Bars must be smoke-free by Jan. 1, 2005.

In an interview Thursday afternoon, Douglas argued the city has no right to provide two 'playing fields' for business.

In bars, patrons can also order food. Douglas noted that since the bylaw came into effect, his business has been down approximately 40 per cent.

Had the city passed a bylaw which allowed for bars and restaurants to be on a level playing field, Douglas said, he wouldn't have filed the lawsuit.

His figure of $5.6 million is based on a number of considerations springing from the bylaw's implementation, including the loss of profits over a number of years. Douglas was not willing to say exactly how many years that is.

When told about the lawsuit, Coun. Doug Graham, who brought forward the proposal to ban smoking last year, said similar suits launched in other parts of the country over smoking bans have failed. He was unsure exactly where those lawsuits were filed.

'I just don't see what they think they can accomplish,' he said, after pointing out the case law on the matter has already been established.

However, Douglas said he hasn't heard of any similar lawsuits. He didn't know of any other city where two competing industries had to deal with such a bylaw being implemented the way it has been here.

In Dawson City, however, indoor restaurants and public places that admit minors must be smoke-free. Restaurant patios and bars can permit smoking.

Coun. Dave Stockdale said Thursday the lawsuit would likely settle things 'one way or another.'

He added that if The Coffee Bar's owner wants to try to 'bankrupt the city, it's up to them, I guess.'

Bourassa, along with councillors Bev Buckway and Dave Austin, won't comment on the matter now that it's been referred to the city's lawyers.

Councillors Mel Stehelin and Yvonne Harris could not be reached for comment as of press time today.

At last week's city council meeting, members revisited the bylaw in response to a number of complaints that restaurants are losing business.

Most council members spoke in favour of sticking to the bylaw. They will vote on whether to stick with the original rule on Monday night.

See letter, p. 21.