The Tribunal awarded damages, and the claimant then applied for legal costs. The Tribunal held that it had the authority to order costs under the Canadian Human Rights Act, and the Federal Court agreed. However, at the Federal Court of Appeal, the court held that the Tribunal did not have the legislated authority to award costs to claimants.

Paul Groarke discussed some aspects of the Supreme Court’s decision on this website. However, there is another theme in the highest court’s decision that I would like to review.

This decision seems to retreat from the general rule that decisions on questions of law by human rights tribunals would be reviewed under the standard of “correctness” and opens the way for a review under the more deferential standard of “reasonableness” under given circumstances. Furthermore, its articulation of those circumstances seems far from clear.

These, with respect, are unfortunate developments. I respectfully suggest that all legal questions from a human rights tribunal, and all legal questions from any tribunal on matters of human rights legislation, continue to be reviewed under the standard of “correctness.” I will elaborate below.

The Court held that while courts have played a deferential role for administrative bodies that manage “complex administrative schemes,” reviewing courts have not adopted a similar approach to decisions on legal questions by human rights tribunals. According to the Court, this is because “the tribunals’ comparative level of expertise remained weak and the regimes they administered were not particularly complex…”

The root of the problem, according to the Court, is the nature of human rights tribunals. The Court noted that while Dunsmuir and Khosa affirmed a deferential standard when a tribunal is interpreting its own home statutes and legal rules, the Court has also held that general questions of law that are outside a specialized area of expertise and of central importance to the legal system must be reviewed on a correctness standard.

As a result, the nature of the “home statute” in the statutory human rights context “makes the task of resolving this tension a particularly delicate one.” The Court noted that:

A key part of any human rights legislation in Canada consists in principles and rules designed to combat discrimination. But these statutes also include a large number of provisions, addressing issues like questions of proof and procedure or the remedial authority of human rights tribunals or commissions.

The Court was careful to note that not all questions of general law before a human rights tribunal should attract a standard of correctness.  When the question falls within the purview of the Tribunal’s expertise, or when the question is not of general importance to the legal system, a standard of reasonableness should still be applied.

However, the Court then applied these observations to the legal question at issue in the case:

In summary, the issue of whether legal costs may be included in the Tribunal’s compensation order is neither a question of jurisdiction, nor a question of law of central importance to the legal system as a whole and outside the Tribunal’s area of expertise within the meaning of Dunsmuir. As such, the Tribunal’s decision to award legal costs to the successful complainant is reviewable on the standard of reasonableness.

It would seem that there are very few (if any) legal decisions involving human rights legislation that are not, actually or potentially, “of central importance to the legal system as a whole.” Indeed the “central importance” of  these decisions would apply at least as much to the substantive interpretation and application of the “principles and rules designed to combat discrimination” than to questions of “proof and procedure and the remedial authority of human rights tribunals or commissions,” as important as the latter questions may be.

As has often been pointed out, anti-discrimination provisions in human rights legislation and their interpretation reflect a central value and purpose of our constitutional system: the pursuit of equality. Furthermore, human rights statutes themselves have been ruled to be “quasi-constitutional” and often have been legislatively mandated and/or interpreted to take precedence over conflicting legislation. Human rights legislation applies to many diverse areas of Canadian life, including areas governed by other legislation, in both the governmental and private sectors. Their interpretation and application can have far-reaching effects in industry and commerce, social services, the professions, education and even the administration of justice and policing.

Even when the constitutionality of legislation or practices isn’t in issue, the matters dealt with in human rights cases can involve or overlap with other constitutionally-protected values. For example, a decision requiring an employer to accommodate the religious needs of a worker can enhance freedom of religion, and a decision condemning sexual harassment or sexual orientation discrimination can enhance the protection of potential victims’ privacy as well as their equality rights.

On the other hand, failing to grant an exemption (or interpreting an exemption provision too narrowly) to a religiously based organization can unduly interfere with freedom of religion and an unduly wide interpretation of the concept of “hostile environment” or of legislation dealing with publications, signs or advertisements can cause an excessive interference with freedom of expression (irrespective of how the courts will decide on the constitutional challenges to the various “hate speech” provisions).

Human rights legislation is indeed somewhat specialized and “complex” in light of all the vital and multidimensional issues it must deal with. However, it is certainly not narrow as are “administrative schemes in domains like labour relations, telecommunications, the regulation of financial markets and international economic relations,” and must not be treated like the law concerning those matters. Human rights law is not only central “to the legal system as a whole,” but central to our entire society. As such, it is the duty of our superior courts to ensure that it is interpreted correctly.

I am certainly not denying that many–perhaps most–human rights tribunal members, adjudicators or commissioners throughout Canada (at the federal, provincial or territorial level) are indeed experts in the field of human rights and make excellent contributions to the development of jurisprudence in that area.

However, whether they have “particular expertise vis-a-vis the courts” entitling their decisions to a more deferential level of judicial review is another matter. I would respectfully suggest that they do not, both as a matter of principle and as a practical matter.

As a matter of principle, as stated above, the quasi-constitutional and paramount nature of human rights legislation and their influence on the entire legal and social system demand that they receive a correct legal interpretation from the highest judicial authorities. In our system, the superior courts, culminating with the Supreme Court of Canada are the highest judicial authorities.

As a practical matter, it seems that Superior Court judges have at least as great experience and expertise as human rights tribunal members or commissioners in dealing with issues facing human rights bodies or related matters. Many judges have in fact served on human rights bodies before their appointment to the bench or have otherwise attained a certain level of expertise in human rights related matters. Indeed they are bound to interpret and apply the Canadian Charter of Rights and Freedoms, as well as the entire Constitution of Canada. They are called upon to review the legality of government decisions, often when those decisions   are challenged as conflicting with the rights of individuals or groups, whether based on human rights legislation, other statutory provisions, or principles based on common or civil law. In matters of criminal law and ordinary civil legislation, they often have to consider values related to human rights in the broad sense, even if human rights legislation or the Charter are not directly involved.

Their work involves the careful balancing of all conflicting rights, duties, interests and values in society. This, it seems, makes them especially qualified to deal with the complex issues and competing values and interests present in litigation under human rights legislation.

I would respectfully suggest that institutional and practical factors militate against increasing the level of deference granted to human rights bodies. Although many members are indeed experts in the field, there are no guarantees that this is always the case. Indeed, in some of the smaller provinces, human rights cases that actually reach adjudication are so rare that it would be unrealistic to expect part-time adjudicators to develop the relevant expertise by reason of their position alone. Most adjudicators are well-respected professionals (usually, but not necessarily, lawyers) and community leaders who are dedicated to promoting human rights and the welfare of society.

However, their involvement in human rights adjudication are often a very incidental aspect of their entire careers, rendering it unlikely that their knowledge in that field would necessarily be superior to that of judges. Furthermore, although occasionally human rights tribunals sit collegially, a single tribunal member decides most human rights cases.

In matters as important as interpretation of human rights law, it is essential that an individual’s decision be subjected to a complete review by a court. (It is true that the first level of judicial review is usually by a single judge of the superior court of first instance, but this is usually subject to appeal to the court of appeal, and occasionally reaches the Supreme Court of Canada.)

Furthermore, as recognized by the Federal Court of Appeal in the instant case (2009 FCA 309 at paragraphs 45-47), conflicting decisions by tribunals could be upheld by the courts in a jurisdiction if reasonableness was the standard of review, leading to confusion among persons subject to the law.

Additionally, as recognized by the Supreme Court in several cases and alluded to in this case, human tribunals do not necessarily enjoy exclusive jurisdiction in human rights cases. Sometimes other tribunals, and in limited circumstances the courts, have concurrent first instance jurisdiction in human rights matters. Would the standard of review on a human rights matter vary with the nature of the tribunal that first heard the case? Would this lead to conflicting decisions on the same issue? If so, this would also create unnecessary confusion in the law. This could lead to the perception that the standard of justice a party received varied according to the forum chosen.

I would respectfully hope that the Supreme Court would reconsider this issue and restore the general rule that questions of law from human rights tribunals be reviewed on a standard of “correctness.” Should they decide to retain the formula chosen in this decision, I would hope that they would deem all (or almost all) such questions to be “both of central importance to the legal system as a whole and outside the adjudicator’s special area of expertise.” Additionally, legislators may wish to amend their relevant legislation to restore the standard of “correctness” to judicial review of decisions on questions of law from human rights tribunals. And in cases where a reduced standard of review is mandated by the legislation itself –as in section 45.8 of the Ontario Human Rights Code, RSO 1990, c H.19 – I respectfully suggest that such amendment must be made.

Edward H. Lipsett, B.A., LL.B., is a guest contributor to TheCourt.ca. He is an independent legal researcher and writer, with a particular interest in human rights and civil liberties.

Background

Jacqueline Plaisier has been employed by Nor-Man Regional Health Authority Inc. (“Nor-Man”) since July 12, 1988. She and her union, the Manitoba Health Care Professionals (the “Union”) contend that Plaisier, upon 20 years of employment, is entitled to a “bonus” week of vacation pursuant to the collective agreement between Nor-Man and the Union. Nor-Man denies this request.

The disputed clause of the collective agreement states that: “an additional week of paid vacation shall be granted to an employee in the year of her twentieth (20th) anniversary of employment…This provision shall apply to all employees employed on August 31, 1989.  It ceases to apply to employees hired after August 31, 1989.”

Therefore, a literal reading of the collective agreement favours Plaisier’s grievance. However, Nor-Man argues that Plaisier was employed as a casual in 1988 and she only began to accrue seniority in 1999; thus, she is not eligible for a bonus week of vacation. In reality, over the last twenty years, Nor-Man has been excluding the period of casual employment when calculating vacation entitlements for other employees, but the Union has never challenged such practice until now.

Judicial History

Under the Manitoba Labour Relations Act (the “LRA”), Plaisier’s grievance went to arbitration. The arbitrator interpreted the term “employment” as being the time at which Plaisier started working at Nor-Man since 1988. However, the arbitrator refused to rely on the technicality of the agreement. Instead, he imposed an estoppel on the Union’s claim on the basis of a “long standing, consistent and open” practice of calculating vacation entitlements between the parties. Because all employees had constructive knowledge of this practice through seniority reports or vacation sheets, the Union’s silence amounted to acquiescence in the employer’s practice. The arbitrator found that it would be unfair and inequitable to allow the Union to enforce the agreement when it had never opposed the practice in the past 20 years. Therefore, the arbitrator estopped the Union from asserting its legal rights. The Union’s application for judicial review was dismissed in the Manitoba Court of Queen’s Bench, where Bryk J. followed Dunsmuir v. New Brunswick (2008 SCC 9, [2008] 1 S.C.R. 190) and held that the standard of review was reasonableness.

While the arbitrator never mentioned “promissory estoppel”, the Court of Appeal thought that the estoppel imposed by the arbitrator resembled promissory estoppel (the SCC later agreed with this). The Court of Appeal held that the appropriate standard of review was “correctness” because the finding of estoppel raised a question that was of “central importance to the legal system as a whole” and was beyond the expertise of the arbitrator. Applying the “correctness” standard, the Court of Appeal stated that the arbitrator had incorrectly applied promissory estoppel and ruled in the Union’s favour.

SCC Analysis

Fish J., writing for a unanimous Supreme Court, disagrees with the Court of Appeal and restores the arbitrator’s decision. Fish J. notes that the arbitrator’s decision on collective agreements is subject to review on a standard of reasonableness. Following the analytical framework set out in Dunsmuir, the standard of reasonableness ‘normally prevails where the tribunals’ decision raises issues of fact, discretion or policy; involves inextricably intertwined legal and factual issues; or relates to the interpretation of the tribunal’s enabling (or “home”) statute or “statutes closely connected to its function, with which it will have particular familiarity”.’

However, does an imposition of estoppel bring the arbitral award within an exception to this general rule? In answering this question, Fish J. states the following:

“An administrative tribunal’s decision will be reviewable for correctness if it raises a constitutional issue, a question of “general law ‘that is both of central importance to the legal system as a whole and outside the adjudicator’s specialized area of expertise’”, or a “true question of jurisdiction or vires”. It will be reviewable for correctness as well if it involves the drawing of jurisdictional lines between two or more competing specialized tribunals.”

Fish J. rules that an imposition of estoppel does not transform it into a question of general law “that is both of central importance to the legal system as a whole and outside the adjudicator’s specialized area of expertise” within the meaning of Dunsmuir. Further, when performing the second step of the standard of review inquiry mandated by Dunsmuir, Fish J. states that the contextual analysis should include the following factors: (1) the presence or absence of a privative clause; (2) the purposes of the tribunal; (3) the nature of the question at issue; and (4) the expertise of the tribunal.

Importantly, Fish J. declares that labour arbitrators are “not bound by a strict legal interpretation of the matter in dispute” (s. 121 of LRA). They are authorized to develop doctrines and fashion remedies appropriate in their field, “drawing inspiration from general legal principles, the objectives and purposes of the statutory scheme, the principles of labour relations, the nature of the collective bargaining process, and the factual matrix of the grievances of which they are seized”. Since “rigidity in the dispute resolution process risks not only the disintegration of the relationship, but also industrial discord”, arbitrators should be given this flexibility to craft appropriate remedial doctrines when needed.

Furthermore, Fish J. explains why the doctrine of estoppel must be applied differently in arbitration than in a court of law by citing Paul C. Weiler:

“… The union and the employer deal with each other for years and years through successive agreements and renewals… By and large, it is the employer which takes the initiative in making operational decisions within the framework of the collective agreement. If the union leadership does not like certain management actions, then it will object to them and will carry a grievance forward about the matter. The other side of that coin is that if management does take action, and the union officials are fully aware of it, and no objection is forthcoming, then the only reasonable inference the employer can draw is that its position is acceptable. Suppose the employer commits itself on that assumption. But the union later on takes a second look and feels that it might have a good argument under the collective agreement, and the union now asks the arbitrator to enforce its strict legal rights for events that have already occurred. It is apparent on its face that it would be inequitable and unfair to permit such a sudden reversal to the detriment of the other side.”

Fish J. affirms that arbitrators are qualified to tailor general legal principles to respond to the distinctive nature of labour relations. Since the arbitrator’s decision is transparent, intelligible and coherent, deference should be given to the arbitration tribunal here.

Conclusion

This decision sends a strong signal to lower courts to refrain from interfering with the decisions of labour arbitrators. While judicial review can prevent an undue extension of arbitral power, arbitrators have a distinctive role in fostering peace in industrial relations. The SCC reinforces that arbitrators can deviate from a strict interpretation of legal principles and craft doctrines that are tailored to the labour dispute before them as long as the decision is within the realm of reasonableness. Given the expansive deference the SCC decision continues to give to arbitrators, the number of applications for judicial review of arbitral decisions will probably decline.

Background

The Mushuau Innu First Nation is located in Labrador near Davis Inlet. In 1983 the Band Council chose to incorporate. Subsequently, in 2000, the Corporation’s Board of Directors adopted By-Law No.1 – the Band’s Constitution. Amongst other provisions, the Constitution sets out governmental requirements and electoral procedures. Specifically, Articles 5.2-5.8 set provisions requiring that elections be called between the 25^th and 35^th month of an electoral term, that a voters list be posted at least two weeks prior to any election by the Returning Officer appointed by the Council, and that the four persons receiving the highest numbers of votes case (2 female, 2 male) be Councillors. The terms of the Constitution were historically supplemented by customary practices, namely the marking of ballots in secret, the writing of candidate’s names in English and Innu-eimun, and the use of telephone and off-reserve voting.

Law

Citing Laboucan v Little Red River Cree Nation No 447 (2008 FC 193), Justice Rennie held that the appropriate legal test for determining the validity of an election involved a two-step analysis. First, in light of the reality that no election is ever perfect, the party challenging the election must demonstrate a “substantial problem” with the electoral process. If this threshold is met, the burden shifts to the respondent to show that the results are still reliable in spite of the problems.

Application

Justice Rennie opted to set aside the election on the basis of four shortcomings:

Notice – Article 5.3 of the Band Constitution requires that elections be held one month after the date of the election call. Band practice had typically seen the Band Manager [Ms Katie Rich] appoint a Returning Officer to run the election in its entirety from start to finish. Though the Band Council decided that there would be an election on January 10, 2010, no steps were taken in furtherance of this until February 20, 2010, when notice was posted for an election to be held thirteen days later on March 5. The Chief, Prote Poker, ended up posting the requisite notice on February 20 when he realized that the Returning Officer, Ms. Veronica Rich Voisey, was not engaged in the process. Despite the responsibilities associated with her position, Ms. Voisey would not become involved in the process until four days before the actual election!

Control of the Ballot Box – Justice Rennie captured the problems regarding control of the ballot box succinctly:

“The polling ended at 5:00pm. Ms Veronica Rich Voisey, the Returning Officer, had control of the ballot boxes up until this point. Thereafter, custody of the ballot boxes becomes unclear. It was conceded by counsel for the applicant that the right of the returning officer to maintain control of the ballot boxes became an issue between Ms. Katie Rich and some members of the Band with the result that the RCMP were called. The RCMP declined to take custody of the boxes, and in the end, Simeon Tshakapesh took control of the boxes. Counting began at 6:00pm and Simeon Tshakapesh was elected Chief.”

Spoiled Ballots – 13% of all votes cast in the election were spoiled. This abnormally high number stemmed from two major problems with the ballots themselves. First, the check boxes beside each candidate’s name were not properly aligned. Second, ballots were only printed in English, and not in Innu-eimun. When the Returning Officer, Ms. Voisey, attempted to bring this issue to the Band Council’s attention, she wad told “not to worry” about it.

Failure To Account for the Number of Ballots Printed – Ms. Voisey was not supplied with an updated voters list when she was appointed Returning Officer. Instead, she was told she “did not need one.” Likewise, the number of total ballots printed was never disclosed. As a result, deceased members of the Band were on the voters list. Likewise, the number of phone-in ballots was not known. Off-reserve voting took place without scrutineers and scrutineers were also not allowed to be present during ballot counting. In combination with the lack of process to identify and verify phone-in voters and the unexplained one hour gap between the close of polls and ballot count, Justice Rennie found ample reason to be suspicious of the final results. This suspicion was amplified by the reality that, mathematically, the number of spoiled ballots could have resulted in up to four different female candidates winning a spot as Councillor.

Holding

As a result of the short notice on which the election was held, the loss of control over the number and form of ballots that resulted in an “unacceptably high” number of spoiled ballots, and the loss of control of the ballot box itself, Justice Rennie found that the “substantial problem” threshold had been met. Unsurprisingly, in light of the aforementioned problems, the respondents were unable to rebut the presumption by demonstrating that the election was nonetheless reliable. As such, the election results were overturned and a new election was ordered, pursuant to s.18.1 of the Federal Courts Act [FCA]. Justice Rennie also issued a writ of quo warranto, but to ensure that the Band maintained a functioning governmental structure during the election, stayed its effect until the fulfillment of the new election. Of interest, recognizing the “extraordinary and discretionary” nature of the remedy, Justice Rennie characterized the remedies available pursuant to s.18.1 of the FCA as anchored in the “historic prerogative relief of the courts of equity.” If this is in fact the case, it suggests the available remedies under the FCA are virtually limitless.

Analysis

In reality, the Innu decision is somewhat academic. The action was initiated after the Band’s 2010 election. Thus, irrespective of the outcome of the case, there would have been an election in 2012 for a new Band Council pursuant to the Band Constitution. Nonetheless, the decision marks a rare instance in which an election was judicially overturned, and helps solidify the appropriate standard for assessing the validity of an election. Although Elections Canada’s past performance reassures us that such a scenario is unlikely to come about during a federal election, Innu could have major implications in future elections of greater significance should such circumstances arise at a national level!

Cst. Parker was testifying against Mrs. Penner when the court became aware of what the prosecutor termed a “chirping” noise from the back of the courtroom, a sort of “running commentary” on the proceedings:

“That’s your f***ing opinion”!! (para 9) Mr. Penner audibly added to Cst. Parker’s testimony. When Cst. Parker finished on the stand, he took the seat at the back next to Cst. Koscinski and warned Mr. Penner he would be arrested if there were any more disturbances. As Mrs. Penner rose to testify, Mr. Penner struck up his commentary again. The prosecutor finally asks the JP to intervene:

THE COURT: Make sure that there is no interruption whatsoever, okay?

MAN FROM THE BODY OF THE COURT: Your Honour, I haven’t said a word.

THE COURT: Okay.

MAN FROM THE BODY OF THE COURT: Until this officer approached me and threatened me with arresting me.

Trololol! At this point, Mr. Penner pulls away from Cst. Parker who contemporaneously decides to arrest the man for causing a disturbance; Cst. Kosinski assists in this endeavor, and Mr. Penner resists.  As the Court of Appeal describes:

The courtroom “dissolved into pandemonium” as the officers took the Appellant into the hallway and ultimately completed the arrest. The Justice of the Peace fled the courtroom and the court clerk followed, locking the door behind him and calling 911 (para 11)

According to his Statement of Claim, Penner suffered a black eye, a wrist injury, and bruising about his temple. He was charged with causing a disturbance, assault resisting arrest, and breach of probation (these charges were dropped at the request of the Crown later that year).

Following his release, he filed a complaint under the Police Services Act alleging misconduct by the arresting officers.

PROCEEDING #1: Complaints issued against the arresting Constables 

The Niagara Regional Police Services Board held a disciplinary hearing for the two constables, which Mr. Penner participated in through self-representation. He cross-examined witnesses and made legal submissions at the hearing, which was presided over by a retired police superintendent (the hearing officer, or HO). The HO’s decision found both officers not guilty of the disciplinary charges against them.

Central to that case was whether the officers had authority to arrest Mr. Penner without the direction of the presiding Justice of the Peace. The HO decided that the law was unclear on this issue, and that the onus was on the prosecution to prove that the arrest was not authorized by statute, and that they had failed to meet that burden.

Mr. Penner appealed this decision to the Ontario Commission on Police Services, which found the arrest to be unlawful, and any forced used was therefore unjustified. The Commission held that the HO should have decided the question of whether the officers acted beyond their authority. The Constables sought judicial review of this decision to the Superior Court of Justice (Divisional Court). It found the arrest to be lawful, restored the decision of the HO, and insisted that the powers of the police and courts could continue to co-exist, especially in this case where there was no direct contradiction.  Mr. Penner appealed the order on costs, but no further—he had more business to attend to elsewhere.

PROCEEDING #2: Action for civil recovery

While Mr. Penner’s complaint was working its way through the Niagara Police Services Board, he filed a lawsuit against the two arresting officers as well as the court officer, the Chief of Police, and the Regional Municipality of Niagara Regional Police Services Board.

PROCEEDING #2(a): Motion under Rule 21 – Issue Estoppel

Following the news that Mr. Penner would not be appealing the judgment of the Divisional Court (the ultimate outcome of Proceeding #1), the constables advanced a motion under Rule 21 of Ontario’s Rules Civil Procedure to seek determination on a question of law before trial in order to dispose of all or part of the action – namely, whether Mr. Penner’s civil claims could be barred by res judicata.

The motions judge found that Penner’s civil claim brought up the same issues and asked the same questions as the disciplinary hearing, and that the two proceedings involved the same parties. The decision of the Divisional Court was final, as Penner elected not to appeal further. On their face, these facts satisfy the Danyluk test for issue estoppel. Regarding the residual discretion granted to judges in these situations, the motions judge found “that no grounds exist in this specific case for me to exercise my discretion to refuse to give effect to the issue estoppel.”

PROCEEDING #2(b): Appeal of Ruling of Motions Judge to ONCA

Good admin law students know that all factors relevant to the exercise of discretion must be considered (ie/ written down) even if the discretionary measure is not in the end accorded (Danyluk/Minott). This error of omission, writes Laskin JA, means, “[they] are entitled to consider afresh whether to exercise our discretion not to apply issue estoppel” (39).

At this point in these proceedings, Justices Laskin, Moldaver and Armstrong are doing the daily grind, but usually their efforts are couched in less blatant terms: the residual discretion afforded in deciding to apply issue estoppel directs a judge to ask whether it would create some “injustice” to use it.

Here’s how the CA weighed the factors in this case in deciding whether or not to use their discretion not to apply issue estoppel even though technically, it applied (or: the test for its general application had been satisfied):

PRO (exercising discretion to not apply issue estoppel [ie/ “Good Reasons To Not Apply Issue Estoppel”]):

1. Different Purposes: the court concludes that Mr. Penner probably didn’t intend to preclude a civil action by pursuing a police complaint against his arresting officers. The civil courts and the police complaints process are two separate processes with two different purposes.
2. No financial stake: The Police Services Act does not provide for compensation for complainants in successful actions. This weighs against applying issue estoppel, but this is mitigated by the potential for gain, as issue estoppel works both ways. The example the court gives is that if the HO had found the police used unreasonable force, they would have been estopped from saying otherwise in a civil action.

CONS (of exercising discretion to not apply issue estoppel [ie/ “Good Reasons to Apply Issue Estoppel in this Instance”])

1. Expertise of the decision maker: our HO lacks legal training as a retired police superintendent, but he does have the qualifications to determine whether there were reasonable and probable grounds for arrest and whether reasonable force was used during that arrest.
2. Procedures in the disciplinary hearing: these police inquiries are no small effort and carry grave potential consequences. The disciplinary hearing, we are told, “had all the hallmarks of an ordinary civil trial.”  Mr. Penner’s lawyer would make that quote the title of his appellate factum if such a document allowed such titles, so incensed was he about this characterization of the hearing. Still, the ONCA reminded us, witnesses were called, evidence was presented, extensive cross-examination was conducted and concluding statements were given.

One difference between the police complaints process and civil trials is that there are two different standards of proof: “clear and convincing evidence” is needed to ground findings of police misconduct, whereas proof “on a balance of probabilities” is required to satisfy a civil claim. Laskin JA says this isn’t that big of a deal, because the HO’s notes indicate he would have found no misconduct even if the standard had been the civil one. While that may be factually accurate, it sounds distastefully like an argument from the “deprived of procedural justice” side of the tracks in this neighbourhood of jurisprudence, and I look forward to the Court’s response.

1. Mr. Penner’s active participation throughout the police complaints process (as was his entitlement, I anticipate the SCC will remind us), and finally
2. Right of appeal: Mr. Penner’s claims were fully assessed on appeal from the Commission’s decision at the Divisional Court (a decision he did not appeal further).

The Court of Appeal concluded that on weighing these considerations, “applying issue estoppel would not be unfair or unjust.” Therefore, issue estoppel applies, most of Mr. Penner’s civil actions are struck from his claim, and he appeals to the top court in the case that surely wins the title of Most Confusing Procedural History, Ever.

Proceeding #2(c): Appeal to SCC of ONCA decision on Motion’s Judge ruling on Rule 21 Application

In his written submissions before the SCC, Mr. Penner’s lawyer heavily emphasizes the differences between police complaints proceedings and civil trials. The parties aren’t independent: the Chief of Police appoints the prosecutor (a police officer) as well as the hearing officer (read: judge), and that HO is a police superintendent, acting or retired. Beyond their “trappings,” courthouse-like or not, the two proceedings serve very different purposes.

Regarding Mr. Penner’s right to participate in the disciplinary proceedings, the legislature’s intent in allowing and encouraging this was to increase transparency and public confidence in police oversight, not to address the complainant’s civil rights. A complainant who participates in a police disciplinary hearing should not be punished by having to forfeit their right to a civil cause of action. This would seem to defeat the purpose of the complaints process.

It is further argued that the Police Services Act itself is incompatible with the application of issue estoppel, as the language in some sections contemplates civil proceedings.

Finally, it is argued that the CA “failed to take into account the unique role of the judiciary in adjudicating allegations of police misconduct” and in doing so, allowed a retired police officer to usurp the role of the judiciary in administering the rule of law:

“The public’s already minimal confidence in the police complaints system will be substantially eroded if an investigation and adjudication run by the police is relied upon to prohibit recourse to the last vestige of independent police accountability-the Court.” (Appellant’s factum, para 75).

The Respondents are arguing in their factum that the bar is set incredibly high for reviewing discretionary decisions; as they explain, this is only done when the discretion was exercised on a wrong principle of law or where there has been some other massive obvious error.

The Respondents also say that the Appellant is seeking to fundamentally alter the settled law in Canada following the decision in Danyluk, which outlines a test of general application for issue estoppel that is malleable to the specifics of each case. The test in Danyluk (as alluded to above: (1) same question/issue, (2) prior decision must have been final/judicial in nature (3) same parties) seems to have been met, but following Minott v O’Shanter, even then the courts retain the discretion to refuse to apply the doctrine if doing so would create unfairness.

It is argued that the Appellants divert the discretionary analysis away from the particular facts of the case and towards the nature of the tribunal and its role alongside the courts. This appeals to the potential for injustice, rather than actual injustice. In doing this, they miss the central issue of this appeal, which is (as framed by the Respondent), “Would the application of issue estoppel given the particular facts of the Appellant’s case be unfair and unjust?”

Finally, the Constables argue in their factum that the application of issue estoppel in this case accords with the policy reasons underpinning the doctrine of res judicata—that this parallel civil litigation is a collateral attack on a final judicial decision, and that challenging unequivocal findings of fact is also an abuse of process.

Proceedings #0 & #3

We will likely never know whether Mrs. Penner was acquitted for her crime of failing to display valid plates, but we can guess that whatever the outcome, she wishes Mr. Penner had just stayed home that day.

Once this case is decided, the remainder of Mr. Penner’s civil suit will unfold.  The Respondents agree that Mr. Penner’s charges of unlawful strip search and use of defective equipment (handcuffs) survive their Rule 21 motion–the only issue being, ultimately, whether and how judicial discretion should be used to apply issue estoppel in the particulars of this case.

The Supreme Court isn’t being asked what is (in my humble opinion) the most interesting question of this whole saga—whether police officers can arrest members of the public attending court proceedings on their own volition and without the authority of the Justice of the Peace. Who rules the courtroom: the presiding judge? the attending officers? or the man in the back wearing  sunglasses and chewing gum?

This reality, in turn, raises a range of issues relating to consistency, overlap, accountability, and efficiency. In more stark terms, it pits claimants’ entitlements to fair, full, and reviewable findings relating to human rights against defendants’ interests in final, binding decisions. The tension between these competing policy objectives was recently considered by the Supreme Court of Canada (SCC) in British Columbia v Figliola, 2011 SCC 52, and resolved in favour of finality—or, perhaps more precisely, on the basis of finality as a proxy for fairness.

Facts

The case began with a decision by the British Columbia Workers’ Compensation Board (WCB) pursuant to its Chronic Pain Policy to award fixed compensation to complainant workers suffering from chronic pain. The complainants appealed to the Board’s Review Division on the basis that a fixed award for chronic pain was patently unreasonable under s.59 of the Administrative Tribunals Act, SBC 2004, c.45 and constituted a violation of the guarantee against discrimination on the basis of disability pursuant to s.8 of the Human Rights Code, RSBC 1996, c.210.

The Review Officer relied on the SCC’s decision in Tranchemontagne v. Ontario (Director, Disability Support Program), 2006 SCC 14, that human rights tribunals do not have exclusive jurisdiction over human rights and that barring explicit statutory language to the contrary, other tribunals have concurrent jurisdiction to apply human rights legislation. In assuming jurisdiction over the human rights complaint, the Review Officer found that the Board’s Chronic Pain Policy was not contrary to s.8.

The complainants further appealed to the Workers’ Compensation Appeal Tribunal (WCAT) but before the appeal was heard, the Tribunal’s authorizing statute was amended so as to explicitly remove its jurisdiction over human rights that would have been assumed by the common law. Consequently, consideration of the complaint by WCAT was statutorily barred, leaving open recourse to judicial review.

Instead of engaging the court’s supervisory role, however, the complainants relocated their s.8 claim to a new administrative milieu, the Human Rights Tribunal (HRT). In response, WCB brought a motion asking the Tribunal to dismiss the new complaint under s.27(1)(f) of the HRC which grants it authority to dismiss claims that have already been “appropriately dealt with.” The HRT opted not to exercise this authority, found that the WCB’s Policy violates s.8, and so sparked a struggle through the court system between the WCB and the complainants regarding the appropriate scope of the HRT’s discretion to determine whether the substance of a complaint has been “appropriately dealt with” when two bodies share concurrent jurisdiction over human rights.

Decision

The SCC unanimously found that the HRT’s decision to assert jurisdiction over the complaint was patently unreasonable in that it was based on predominantly irrelevant factors outside the scope of its mandate, causing it to be set aside and the complaints dismissed. The SCC was split five to four, however, on the proper test to be applied in determining whether a matter has been appropriately dealt with, diverging theoretically on the basis of who (i.e. the courts or administrative decision-makers) should be tasked with navigating the proper balance between the competing policy considerations at stake.

Writing for five Justices, Abella J. found that the underlying purpose of s.27(1)(f) is to create “territorial respect among neighbouring tribunals, including respect for their right to have their own vertical lines of review protected from lateral adjudicative poaching.” It is a codification, in other words, of the cumulative policy rationales undergirding the doctrines of issue estoppel, collateral attack, and abuse of process: “finality, the avoidance of multiplicity of proceedings, and protection for the integrity of the administration of justice, all in the name of fairness.”

The claimants’ attempt to raise the same arguments at the HRT amounted to forum shopping,  problematic both from the perspective of procedure (i.e. an inefficient use of limited administrative resources) and substantive justice (i.e. raising the possibility of inconsistent results). The correct test to be applied by a Tribunal in determining the scope of s.27(1)(f) is: (1) whether there was concurrent jurisdiction to decide the issues; (2) whether the previously decided legal issue was essentially the same as what is being complained of to the Tribunal; and (3) whether there was an opportunity for the complaints or their privies to know the case to be met and have the chance to meet it, regardless of how closely the previous process procedurally mirrored the Tribunal’s.

Approach

Interestingly, all nine Justices agreed that the interpretive approach applied by the Tribunal was problematic in that it relied too heavily on the strict requirements of existing legal doctrines aimed at preventing multiplicity of proceedings (i.e. issue estoppel, collateral attack, and abuse of process). The court rejected that s.27(1)(f) is a wholesale codification of these doctrines, finding instead that it is to be interpreted and applied in terms of their underlying policy objectives. In other words, the Court adopted an approach in which a particular legal outcome is reached in light of policy-oriented evaluative criteria.

This approach is effective in that it remains cognizant of the inherent limits of formal legal tests as proxies for particular policy considerations. It recognizes, in other words, that it is policy—and not a sterile, normatively neutral legal analysis—that does the heavy-lifting in an adjudicative body’s decision-making calculus. It also brings the discussion of underlying policy considerations to the forefront, allowing decisions to be evaluated on the basis of their ability to strike a socially desirable balance within a matrix of competing policy objectives as opposed to a “correct” or “incorrect” application of black letter law.

A Conception of Fairness and Access to Justice

Given the Court’s implicit endorsement and application of such an approach, it becomes possible to evaluate the policy considerations and balances struck in reaching its conclusion. The conception of fairness that informed Abella J.’s reasoning on behalf of the majority of the Court was one that denied that “access to justice means serial access to multiple forums, or that more adjudication necessarily means more justice.” In other words, access to justice is to be understood as access to final justice, which may or may not be the same thing as substantive justice.

This conception, one that is beneficial to employers in the workplace compensation context, is premised on the need to maximize the efficient allocation of resources; thus, Abella J. finds that “it is really a question of whether it makes sense to expend public and private resources on the relitigation of what is essentially the same dispute.” In this vein, she rejects the argument that the matter should be remitted to the Tribunal to be reconsidered in light of the correct test, finding that there is “no point in wasting the parties’ time and resources by sending the matter back for an inevitable result.”

It is this focus on resource allocation, in turn, which is taken up by Cromwell J. in his concurring opinion on behalf of four members of the Court. He emphasizes that the intention of s.27(1)(f) is to “achieve the necessary balance between finality and fairness through the exercise of discretion.” This discretion, in turn, is to belong to the HRT, an administrative agency with expertise in the polycentric decision-making that defines the human rights realm. Thus, the Tribunal erred not because it failed to apply the 3-pronged approach delineated by Abella J. (an approach which glosses over the stark differences between the procedural safeguards of various administrative decision-makers with concurrent jurisdiction over human rights) and thereby assigned insufficient weight to efficiency considerations, but because it failed to conduct a flexible, global assessment as between the competing policy objectives at stake.

Overall, the divergence between the two opinions of the Court can be framed in terms of an institutional preference for vertical as opposed to horizontal review. It can also be understood as a normative judgment about the degree of freedom that should be given to human rights tribunals in striking the appropriate balance between efficiency and fairness—assuming, as Abella J. declines to do, that the two can at times mean two very different things.

Vancouver’s Downtown East Side (DTES) has long been known for its rather unique neighbourhood makeup. 4,600 intravenous drug users, nearly half of all of those in the city are crammed into just a few city blocks that are littered with evidence of the bleak existence of its inhabitants. 

By the early 1990s, injection drug use had reached crisis levels and epidemics of HIV/AIDS and Hepatitis C soon developed.  In September 1997 a public health emergency was declared in the DTES. With an already marginalized population dealing with complex mental, physical and emotional health issues, health authorities recognized that a conventional abstinence-based solution, simply would not be effective. Instead, after years of research and planning, the Vancouver Coastal Health Authority in conjunction with the Province proposed a plan that addressed the health concerns of residents at all points in the treatment of their addiction, and not simply when they had been able to quit drugs for good. The plan included supervised drug consumption facilities, which, although controversial in North America, have been established with success to address health issues surrounding injection drug use in seventy other cities in Europe and Australia.

Legally operating a supervised injection site in Canada requires an exemption from the prohibitions on possession and trafficking of controlled substances under s. 56 of the Controlled Drugs and Substances Act, S.C. 1996, c. 19 (CDSA), which provides for exemption from application of the CDSA at the discretion of the Minister of Health “if, in the opinion of the Minister, the exemption is necessary for medical or scientific purpose or is otherwise in the public interest.” The clinic, Insite, opened its doors in September 2003, shortly after receiving this conditional exemption, and has been in operation daily from 10am to 4am since.

To be clear, the site does not provide drugs to its clients; it is a strictly regulated health facility. Upon arrival the client must check in and sign a waiver. They are closely monitored during and after injection. Clients are provided with health care information, counseling and referrals to various service providers or an on-site, on demand detox centre. The services available at Insite help to mitigate many of the significant risks of intravenous drug use, such as sharing needles, using dirty puddle water for injection, and accidental overdose.  The endeavor is supported at the local and provincial level of government as well as the by the police and wider community in the area. Insite has proven to save lives and improve health.

In 2008 a formal application for a new exemption was made, prior to the expiry of the initial exemption. This action was commenced in the Supreme Court of British Columbia when the Minister denied the application. The trial judge found that the application of ss. 4(1) and 5(1) of the CDSA, which prohibit possession and trafficking of controlled substances, violated the claimants’ rights under s. 7 of the Charter of Rights and Freedoms. Insite was granted a constitutional exemption, allowing it to operate free from the federal drug laws. The Court of Appeal dismissed the appeal and held that the doctrine of inter-jurisdictional immunity applied. The Supreme Court of Canada (SCC) in a unanimous decision dismissed the appeal and cross-appeal and ordered the Minister to grant an exemption to Insite under s. 56 of the CDSA.

Analysis:

The SCC’s decision in Canada (Attorney General) v. PHS Community Services Society,  speaks to the legal realist in me. It is not difficult to get on board with the result of the case; of course, a program that manages to address the health of a marginalized population with distinct health challenges should be supported. Nonetheless, the manner in which the court arrived at its decision raises some questions regarding the degree to which the court is encroaching on the legitimate role of Parliament. Below, I will discuss the Court’s arguments regarding the doctrine of inter-jurisdictional immunity. The SCC’s analysis of the section 7 challenge and concluding thoughts will appear in a forthcoming post.

Inter-Jurisdictional Immunity:

The Court was not keen to extend the inter-jurisdictional immunity doctrine in this case. The doctrine of inter-jurisdictional immunity comes into play in conflicts of division of powers between the federal Parliament and provincial Legislatures. It is a doctrine by which a province is prohibited from legislating in a manner that would have an adverse effect on the core of a federal head of power (and vice versa). The doctrine is narrow and its premise of fixed water tight cores of jurisdiction is at odds with the modern federalism tendency to allow overlap, as evidenced by the double aspect doctrine and cooperative federalism. To apply it here would disturb settled competencies and introduce uncertainties for new ones. Though the doctrine is not dead, it is out of step with the modern trend of striking a balance between the federal and provincial government and performing a pith and substance analysis and restrained application of federal paramountcy. Before extending the doctrine of inter-jurisdictional immunity to a new area, the court should ask whether the constitutional issue can be resolved on another basis.

Here, the Court found that the proposed core of provincial power of health had never been recognized in jurisprudence. Furthermore, the Court found that the claimants had not delineated a “core” of exclusive provincial power, noting that this area is broad and extensive, encompassing thousands of activities in many places; a poor fit for this limited application of this doctrine. Furthermore, the court applied Canadian Western Bank v. Alberta, and noted that applying the doctrine of inter-jurisdictional immunity would be at odds with the emergent practice of cooperative federalism and the general preference, where possible, for the ordinary operation of statutes enacted by both levels of government. The court also expressed concern that applying the doctrine of inter-jurisdictional immunity would create legal vacuums as the government benefiting from the immunity is not actually compelled to legislate in the area. In light of the doctrine’s narrow scope and the potential for complications that would stem from its application, the Court found that the doctrine of inter-jurisdictional immunity was neither necessary nor helpful, and accordingly dismissed the claimants’ argument.

The arbitration panel established to hear the dispute concluded that Mexico’s measures were in breach of its Chapter 11 obligations to afford a certain degree of protection to the investors (and investments) of the NAFTA parties and awarded damages to both the parent and subsidiary company in the amount of US$77,329,240. This arbitration award incorporated compensation for both “down-stream” and “up-stream” losses. The former includes the value of direct sale loss and associated costs suffered by CdM and is not contentious. The latter, however, represents the cost of lost sales to CdM of products manufactured by Cargill in its plant in the United States and was the subject of a recent case decided by the Ontario Court of Appeal (OCA).

Since the parties to the NAFTA dispute selected Toronto as the “place of arbitration,” Ontario courts were vested with the authority to review the panel’s award under the International Commercial Arbitration Act, RSO 1990, c 1.9, which adopted the UNCITRAL Model Law on International Commercial Arbitration (“Model Law”). In Mexico v Cargill, 2011 ONCA 622, the OCA affirmed the lower court’s dismissal of Mexico’s challenge to the jurisdiction of the panel to award up-stream damages.

In order to reach this conclusion, the OCA was tasked with identifying and framing the proper standard of review to be applied by domestic courts in reviewing the decisions of international arbitration panels. More specifically, the Court articulated when, and on what basis, an arbitration award is subject to being set aside by a domestic court on the ground that it lacks jurisdiction.

The Panel’s Decision – A disjuncture between NAFTA objectives and implementation?

In justifying the award for up-stream losses, the panel acknowledged that Chapter 11 applies only to “measures relating to investments that are in the territory of the State Party enacting the measures.” It also confronted a finding by the tribunal in Archer Daniels Midland v The United Mexican States that it lacked jurisdiction to award compensation for lost profits the claimants “would have produced in the United States and exported to Mexico ‘but for’ the Tax, as these losses were not suffered in their capacity as investors in Mexico.”

The panel in Cargill found that the business model of the claimant (i.e. manufacturing HFCS in the United States, importing into Mexico through a border facility in Texas, and distributing in Mexico through CdM’s distribution centre in Tula) was sufficiently integrated so as to constitute a cohesive, indivisible investment for the purposes of Chapter 11. Since CdM’s selling of HFCS to the soft drink industry in Mexico was contingent on its being imported from the parent company in the US, the two operations “were so associated… as to be compensable under the NAFTA.”

Unsurprisingly, the panel’s “integrated” approach to the characterization of investment may have wide-ranging implications for governments seeking to ascertain the potential costs of implementing NAFTA inconsistent regulatory measures. It is difficult to tell exactly where the line of “association” between parent companies and their subsidiaries will be drawn given the intertwined and interdependent nature of their economic affairs.

The logical corollary of an “integrated” definition of investment is a corresponding consolidation of various economic roles into a single, broad conception of “investor.” In reaching its conclusion, the panel dismissed Mexico’s argument that the losses suffered by Cargill in the US were those suffered in the company’s capacity as producer and exporter and not as an investor in CdM, its Mexican investment.

The most interesting aspect of the decision—and perhaps the most troubling—is the way in which the panel distinguished the seemingly unequivocal (although not binding) findings of the panel in Archer Daniels. The Cargill panel found that up-stream losses were justified since CdM was not a producer of HFCS and thus depended on the HFCS sold to it by the parent company, unlike the investors in Archer Daniels whose investment took the form of a more extensive, joint venture production operation in Mexico.

If the oft-cited goals of attracting foreign direct investment are to increase jobs, technology and expertise transfer, and to capture more of the value-added production chain in host states, then why would more incentives be created for companies to produce and process within their home state and simply distribute to host countries? The panel’s understanding of how to implement NAFTA Chapter 11, in other words, is not consonant with the treaty’s underlying policy objectives. Or, at the very least, the treaty’s public justification.

The OCA’s Decision – The (in)correct framing of the reasonableness standard and an (un)reasonable application of the correctness standard?

Although the OCA distanced itself from importing domestic administrative law concepts into judicial review of international investment arbitration, it still found that correctness was the appropriate standard to review jurisdictional issues. What is unclear, however, is why the Court seemed to frame the correctness standard as being a lower one than reasonableness by suggesting, at para 51:

Any time the court reviews on the reasonableness standard, it undertakes an in-depth analysis of the reasoning and decision of the tribunal in order to decide whether the result is a reasonable one… Once a court enters into a reasonableness review, it is effectively considering the merits of the tribunal’s decision and deciding whether that decision is acceptable because it is reasonable, not because it was made within the jurisdiction of the tribunal.

However, adopting a reasonableness standard for the question of jurisdiction would simply require the court to ask: “was it reasonable for the tribunal to conclude that it had the authority to enter into this line of inquiry?” and not to conduct any substantive review of the merits of the case.

Nevertheless, having adopted a correctness standard, the Court was required to determine whether or not the tribunal correctly interpreted (and acted within) its jurisdiction. Article 34(1)(a)(iii) of the Model Law allows a Superior Court judge to set aside a decision of an international arbitral tribunal where “the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains decisions on matters beyond the scope of the submission.”

Thus a tribunal’s jurisdiction is circumscribed by the scope of the parties’ submission, defined by the Court as consisting of: (1) the agreement of the parties; (2) the words of the relevant Articles from Chapter 11, and where relevant, from other chapters of NAFTA; and (3) any interpretation of those words subsequently agreed to by the NAFTA signatory parties.

In applying the standard, the Court found that the tribunal’s award of up-stream damages stemmed from its interpretation of damages arising from an investment and thus was within the scope of the submission and the NAFTA provisions.  The Court gave two examples of scenarios where a tribunal would fail to meet this correctness standard: if it made a finding in relation to an investment in Brazil (i.e. a non-party to NAFTA) or in relation to a period of time which was not contemplated by the parties to the arbitration. The court’s posture, in other words, is a highly deferential one.

Both Canada and the United States appeared as intervenors in the appeal and supported Mexico’s position that the only compensable damages are those suffered in the territory of the Party where the investment is located and not losses suffered by the investor in its home business operation. A proper application of the correctness standard on the issue of jurisdiction would presumably give adequate consideration and weight to the statements of the parties to NAFTA as to the proper interpretation of the treaty (i.e. the third component of the scope of “submission” identified by the Court). The Court, however, simply found that these statements do not constitute “a clear, well-understood, agreed common position.” What would constitute a clearer common position, however, was not explained.

Overall, while the task of “navigat[ing] the tension between the discouragement of courts to intervene on the one hand, and on the other, the court’s statutory mandate to review for jurisdictional excess” is no doubt a complicated, politically sensitive one, the need to calibrate a sufficiently precise, conceptually sound standard for judicial review of international arbitration remains an outstanding project after Cargill.

According to Dr. Cuthbertson and Dr. Rubenfeld – the two doctors responsible for Mr. Rasouli’s treatment – there is absolutely no hope for recovery. As such, they believe that it is in the patient’s best interest to be taken off life support and transferred to palliative care. Ms. Parichehr Salasel, however, is determined to keep her husband, Mr. Rasouli, alive.

As her husband’s litigation guardian and substitute decision-maker, Ms. Salasel is of the view that “where there is life, there is hope.” In fact, she argues that her husband has actually “responded” on a few occasions to the voices of her and her children. In short, she refuses to consent to the doctors’ plan to withdraw life-sustaining treatment. If they intend to override her lack of consent, she maintains, they must apply to the Consent and Capacity Board (CCB), an independent provincial tribunal.

For all of its emotional, philosophical and scientific complexity, the issue here appears to be, at the very least, clear: life or death? The doctors think it is time to let Mr. Rasouli die, and Ms. Salasel thinks not. Realizing that the two parties are, on a number of levels, worlds apart, Ms. Salasel turns to the courts.

The Superior Court

In her application to the Superior Court of Justice of Ontario, Ms. Salasel sought two specific orders:

(1) An order restraining the appellants [doctors] from implementing the proposed changes to the respondent’s current treatment plan without first obtaining her consent.

(2) An order requiring the appellants [doctors] to refer their treatment proposal to the Board [CCB] should they persist in challenging Ms. Salasel’s authority to reject it on the respondent’s behalf as being contrary to his best interests.

The doctors cross-applied for, among other things, a declaration that (a) they can lawfully withdraw life-sustaining treatment, and (b) they do not need Ms. Salasel’s consent in order to proceed with their proposed “treatment plan.” In March, 2011, Justice Susan Himel found in favour of Ms. Salasel, declaring that the doctors’ proposal to “end life sustaining treatment to the applicant…must be referred to the Consent and Capacity Board.” Until the CCB makes a decision, she ruled, the doctors must not withdraw mechanical ventilation.

The Court of Appeal

As expected, the doctors appealed Justice Himel’s orders. The appellants note that patients do, without question, have the right to refuse treatment, but they do not have the right to demand treatment that is of no medical value. The current treatment plan, they argue, is exactly that: of no medical value. They make it very clear that they are not saying doctors should be permitted to withdraw treatment whenever they like, free of legal consequences. Rather, a doctor is obliged to provide the patient with treatment that she believes, in her expert opinion, to be medically effective. As such, the appellants contend that Justice Himel’s orders will set a “dangerous precedent” by forcing doctors to “obtain the consent of patients before withholding or withdrawing treatment that they consider to be of no medical value.”

More importantly, the doctors argue that Justice Himel erred in finding that the “withdrawal of life support” constitutes “treatment” under the Health Care Consent Act. This was a crucial interpretation, of course, because “treatment” requires consent. Thus, the appellants submit that the withdrawal at issue here is not actually treatment as defined by the Act, and so it does not require the patient’s consent.

Writing for a unanimous Court of Appeal, Justices Moldaver and Simmons focus on this issue of whether or not Justice Himel erred in her interpretation of “treatment” under the Act. In essence, Justice Himel found that the Act recognizes specifically that “withdrawal of treatment” may form part of a “plan of treatment.”  Moreover, the act makes it clear that “treatment” includes a “plan of treatment.” Thus, withdrawing life support is an act of treatment. The appellants admit that this may be true in cases where life support measures serve a “therapeutic or preventive purpose.” This is not one of those situations, however, because the life support he is receiving is of no medical value.

Ms. Salasel, on the other hand, cannot accept that these life support measures have absolutely no value. Her argument, although admittedly simplistic, is persuasive in the sense that these measures are literally keeping him alive. For the purpose of this appeal, however, Justices Moldaver and Simmons decide that they:

…need not resolve the metaphysical debate over whether life saving measures in cases such as the respondents are of no medical value because they are futile, or of high medical value because they are keeping him alive while his family continues to hold out hope for his recovery.

Having disregarded the medical value debate as “metaphysical,” the Justices turn their attention to the question of whether the doctors’ plan constitutes treatment. The key here is that the plan is not simply to withdraw life support, but to subsequently provide palliative care. While palliative care is not explicitly defined in the Act, it is included in the Act’s definition of treatment. Thus, the doctors must, by law, obtain consent from Ms. Salasel before administering palliative care.

Based on expert testimony, the Justices find that the stopping life support and beginning end-of-life care are, at least in this situation, inextricably connected. The Justices put it like this:

…in the respondent’s circumstances, removal of the ventilator is a necessary precondition to the administration of end-of-life palliative care and end-of-life palliative care is a necessary response to removal of the ventilator.

Where both are recommended, as is this case here, one cannot be separated from the other. They are a package. In essence, the Justices are saying that the consent requirement for palliative care extends to the doctors’ entire plan, which happens to include the withdrawal of life support measures. Rather than actually address the issue of whether the removal of life support constitutes treatment requiring consent, the Justices conclude somewhat simply that the entire plan requires consent because it includes palliate care, which is a “treatment” under the Act. This means that if Ms. Salasel continues to withhold consent – which she likely will – the doctors “proposal” will have to be referred to the CCB.

Evidently, the issue facing the courts was not one of life or death. It was life, death or let someone else decide. Through some sound, yet crafty logic, both the Superior Court and the Court of Appeal managed to push the question into someone else’s lap.

Good luck, CCB.

In this land of the three giants, the spectrum of wireless electromagnetic waves are owned and administered by the Federal Government, who determines what waves may be used by whom, and for what purpose.  In 2008, an auction was held for licenses in the Advanced Wireless Services (AWS) spectrum for telecommunication common carriers (TCC). This auction allowed the smaller TCCs to bid first, to have their chance to challenge the giants.

Globalive (the company responsible for WIND Mobile), a hip, new TCC with no-fixed-term-contracts and the financing of an Egyptian giant called Orascom, paid over $440 million for what they thought was their piece of the pie. Before they could slice into the unsatisfied Canadian market, however, they faced hurdles of red tape. Three years on, Globalive is still fighting for approval to keep their share of the Canadian market, which is growing every day.

This post will review the history of Globalive’s entry into the Canadian telecommunications market, focusing on the recent decision of the Federal Court to quash Cabinet’s grant of an operating license.

The Macro View of this Judicial Review

For clarity, here is an overview of how the issue of WIND Mobile’s continued existence in Canada has played out so far:

1. The Free Market: (2008) – Globalive purchases licenses to transmit over the AWS for $440 billion, but requires approval from the:

2. Minister of Industry: (2009) – who , applying s. 10 of the Regulations of the Radiocommunications Act and Regulations, decides that Globalive meets the requirements. Globealive requires further approval from the:

3. Canadian Radio-television and Telecommunications Commission (CRTC): (2009) – which, applying s. 16(3) of Telecommunications Act (TCA) decides that Globealive is not “Canadian controlled in-fact.”  This decision is reviewed pursuant to s. 12(1) of TCA by the:

4. Governor in Council: (2009) – who decides that Orascom has avenues of influence, but not “control in fact.”  This decision is subject to judicial review, it is later decided, on a standard of correctness by the:

5. Federal Court: (2011) – which finds that the Governor in Council made errors of law and quashes the decision.  The Federal Court’s ruling is appealed to the FCA.

Politics/Backstory:

Globalive obtained a license from the Minister of Industry Tony Clement, who was satisfied that the company was “Canadian-owned and controlled” as per s. 10 of the Regulations (which uses identical language to s. 16(3) of the TCA . Public Mobile, another small TCC vying for market share, was also granted a license by the Minister. Both companies then had to demonstrate to the CRTC that they were within the ownership and control parameters set by the TCA.  The CRTC decided that Globalive was controlled in-fact by Orascom Telecom Holding (Canada) Ltd., its Egyptian financer. As a result, according to the CRTC, Globalive did not meet the requirements of s. 16(1) and was not considered eligible to operate as a common carrier in Canada. It also decided that Public Mobile had to make certain structural changes before it could receive a license.

As a result of this decision, the Minister of Industry brought a motion to review, relying on the rule in the TC which states that within a certain period of time, the TCA grants the power to the Governor in Council (read: Cabinet) to vary or rescind a CRTC decision, or send it back for reconsideration (s. 12).  The parties then made submissions to the Governor in Council, who varied the CRTC decision and determined that Globalive was not controlled in-fact by a non-Canadian (or, in other words, that Globalive was controlled in-fact by Canadians).  It is this decision by the Governor in Counil that is the subject of the judicial review before us, dated February 4^th 2011, from the Federal Court.

At the Federal Court, Mr. Justice Hughes found that Cabinet’s holding that Globealive is Canadian-controlled was based on errors of law and quashed the decision, subject to a forty-five day stay. On February 15^th, the Minister of Industry announced that the government would be appealling the Federal Court’s ruling, stating that:

“Globalive is a Canadian company that meets the Canadian ownership and control requirements under the [TCA]… The policy of our government is to encourage choice and competition in wireless and Internet markets…new entrants mean more competition, lower prices and better quality services for Canadians.”

Read more here.

The Minister’s reading of the TCA as embracing competition and choice by welcoming carriers like Globalive, financed by foreign TCCs, was of top concern to the Federal Court, who relied heavily on that skewed interpretation to quash the Governor in Counsil’s decision.

Clement’s in Denial: The CRTC’s Decision (“The Decision”)

The CRTC found that Globalive is controlled by Orascom, the Egyptian company, and as such fails the requirement of s. 16(3) of the TCA, which states:

16. (1) A Canadian carrier is eligible to operate as a telecommunications common carrier if

(a) it is a Canadian-owned and controlled corporation incorporated or continued under the laws of Canada or a province…

16. (3) For the purposes of subsection (1), a corporation is Canadian-owned and controlled if

(a) not less than eighty per cent of the members of the board of directors of the corporation are individual Canadians;

(b) Canadians beneficially own, directly or indirectly, in the aggregate and otherwise than by way of security only, not less than eighty per cent of the corporation’s voting shares issued and outstanding; and

(c) the corporation is not otherwise controlled by persons that are not Canadians.

Both (a) and (b) describe legal control. Globalive met these requirements by having Canadians sit as board members and own more than 80% of the voting shares.  It is the last category, (c) which refers to “control in fact.” According to the CRTC, the test for de facto control comes from its decision in Canadian Airlines Decision of the National Transportation Agency, No. 297-A-1993, 27 May 1993:

“…There is no one standard definition of control in fact but generally, it can be viewed as the ongoing power of ability, whether exercised or not, to determine or decide the strategic decision-making activities of an enterprise. It can also be viewed as the ability to manage and run the day-to-day operations of an enterprise.”

This decision further notes that many small ties between companies, while on their own may not be enough to exert control, might, when taken together, result in a degree of influence which amounts to control.

In order to determine if Orascom had control in-fact over Globalive, the CRTC looked at (i) Globalive’s corporate governance structure, (ii) the company’s shareholder rights, (iii) it’s external commercial arrangements, and (iv) economic participation between Globalive and non-Canadians.

Under the category of corporate governance, the CRTC examined the composition of Globalive’s Board of Directors, quorum provisions, and the appointment of officers.  It proposed amendments to curtail Orascom’s control, such as reducing the number of directors the financer may nominate. With respect to shareholder rights, the CRTC noted that extensive modifications were needed to reduce the impact of Orascom’s veto powers.

As for the external commercial arrangements with non-Canadians, the CRTC found that Globalive’s Technical Service Agreement (TSA), which allows Globalive to access Orascom’s wireless expertise, results in continued influence by Orascom over operating and strategic decisions at Globalive. Furthermore, the Trademark Agreement for WIND Mobile is with one of Orascom’s subsidiaries, and the CRTC found that Orascom  would have the power to limit how the brand was used [para 89 of CRTC Decision].

Lastly, when considering economic participation of non-Canadians, the CRTC found that Orascom’s equity participation of 65% was likely to result in an avenue of influence, but was not determinative of control.  Moreover, regarding financing, the Commissioner found Globalive’s debt to Orascom ($508 million) to be unacceptably high. The CRTC noted that while there are no statutory limits on the amount of debt that a non-Canadian can provide to a telecommunications provider, it is a strong indicia of where influence really lies.

Altogether, the CRTC found that the factors it considered amounted to “control in fact” by Orascom of Globalive, and therefore that Globalive did not meet the requirements set out in s. 16(3) of the TCA.

What’s the Big Deal Anyway? The Governor in Council’s Decision (“GC’s Decision”)

The GC’s Decision sounds like a very strange document. There are two parts: the first part is a series of “Whereas…” clauses, followed by a concluding “Therefore…” The second part is an attached Schedule of paragraphs from the CRTC Decision.

For the purposes of s. 12(8) of the TCA, which says that where the Governor in Council makes an Order such as this (to vary or reject a CRTC decision) the reasons shall be set out; Hughes J concludes these “Whereas” clauses are the Reasons, and the Schedule is the s. 16 decision, that Globalive is Canadian owned and controlled “in fact.”

The final Whereas on the first page of the GC’s Decision interpreted the CRTC’s decision as being determined by Globalive’s debt financing by a non-Canadian entity. [Para 42]

The GC’s Decision then reviewed the main policy objectives underscoring the Act, (which correspond to what is laid out in ss. 7(b), (c), and (d) of the TCA):

(b) to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;

(c) to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;

(d) to promote the ownership and control of Canadian carriers by Canadians

While Hughes J states succinctly that “one policy cannot be subordinate to another” [Para 47], the GC “considers that, when possible, the Canadian ownership and control requirements should be applied in support of the Canadian telecommunications policy objectives set out in the Act, including enhancing competition in the telecommunications market (emphasis added in Hughes J’s judgment).”

The GC’s Decision indicated that access to foreign capital, technology and expertise was predominantly important to the field of telecommunications, and that the TCA should be interpreted so as to ensure outward growth in this fashion, albeit within the parameters set by the existing control requirements (restricting voting shares by non-Canadians, in particular) [Para 48].

It is further noted, presumably as a heads up to future drafters of such documents, that the test for control is a double negative – (16.3(c) is the corporation not otherwise controlled by persons that are not Canadian). When asked if the double negative was happenstance, counsel for the AG and Globalive said no, arguing that a broadly held, multi-national entity may have control over a TCC and not be forced out by this rule, so long as it was “not a non-Canadian.” Nothing more was said of this point, but it’s a good lesson for those who craft statutes.

The GC’s Decision then recognized that multiple levels of influence can amount to control, but “that is not the case with Globalive.”

In summation:

“Whereas the Governor in Council considers that, on the basis of a careful examination of the facts and submissions before the Commission, it is reasonable to conclude, for the reasons set out in this Order, that Globalive is not in fact controlled by persons that are not Canadian and therefore meets the Canadian ownership and control requirements under the Act and is eligible to operate as a [TCC] in Canada.”

As a nota bene, the second last paragraph of the decision limits the ramifications of finding a company as foreign-owned as Globalive to be Canadian controlled in fact, saying their Decision “has a significant direct impact only on Globalive.” Obviously, the companies that have to compete with Globalive’s $35/month cellphone plans disagree.

The attached Schedule altered the findings of the CRTC regarding: the structure of the board, whether debt-financing structure could result in undue influence by a non-Canadian, the effect of liquidity rights, the definition of eligible purchasers of shares, and the effect of the TSA and Trademark Agreement.

The variable interpretation of the same facts by the two federal entities, listed in such stark language, is remarkable. See Para 85 to watch language, law and politics collide in a tornado of policy and analysis!

The Conclusion aptly sums up the Schedule:

CRTC’s decision: 118.     …In other words, the Commission finds that Orascom has the ongoing ability to determine Globalive’s strategic decision-making activities.

Governor in Council’s decision: 22.      …In other words, Orascom does not have the ongoing ability to determine Globalive’s strategic decision-making activities.

“Took a Look at your Report; Did Not Like it”, Decides the Federal Court

Hughes J identified two main issues in the case before him:

1.     Does Public Mobile have standing to bring this request?

i.         Does it have an effective remedy under the Act, which it has not exhausted?

2.     Did the Governor in Council act within the statutory mandate in varying the CRTC decision concerning Globalive?

Before directly addressing these issues, Justice Hughes speaks to his role in this mess. Paraphrasing Bastarache and LeBel in Dunsmuir v. New Brunswick [2008] 1 S.C.R. 190, he notes that the courts act to supervise the administrative powers exercised by government decision-makers.  All public authority derives from enabling statutes, or the pertinent common or civil law, and the purpose of judicial review is to ensure public figures act within those legal boundaries. When they do not, those authorities transgress the principle of rule of law. As was recently considered in Telezone, reviewed here, (Court.ca link) and as I discussed in the case of the bank-robber McArthur (Court.ca), judicial review is directed at the legality, reasonableness and fairness of the procedures employed and actions taken by the government decision-makers. This authority is derived from s. 18(1) of the Federal Courts Act, which “was enabled to enhance government accountability as well as promote access to justice.” (Para 32 of Telezone). I would suggest that Hughes J doesn’t care whether Globalive gets to compete or not, so long as the law is applied correctly.

Mind Your Own Business: The Issue of Standing

When the Cabinet said it’s “relaxed approach” to interpreting the TCA would only apply to Globalive,  it ruffled a few feathers in the Canadian telecommunications industry.  The applicant in the case before the Federal Court is Public Mobile, one of WIND Mobile’s main competitors.

A preliminary issue for consideration is whether Public Mobile, whose legal entitlements were not impacted by the Governor in Council’s decision, has standing to ask for review of that decision. As the CEO of Public Mobile protested, “[the GC’s Decision] directly impacts my ability to get more money and grow.” Air Canada v. Toronto Port Authority informs judges to determine standing by both the context of the situation and the basis for judicial review. Hughes J. decides that Public Mobile does not have direct standing: in order to be directly affected, one’s legal rights must be imposed upon, or legal obligations adversely prejudiced. However, Hughes J found without difficulty that Public Mobile satisfied the three-fold test set out in Canadian Council of Churches v. Canada (Minister of Employment and Education) [1992] 1 S.C.R. 263:

a)    A serious issue has been raised;

b)   The party seeking public interest standing has a genuine or direct interest in the outcome of the litigation; and,

c)    There is no other reasonable and effective way to bring the issue before the Court.

According to Public Mobile, if Industry Canada allowed them and everyone else to “have the same kind of structure as Globalive and get foreign capital…this application would not have been brought forward.” (Para 77).  Despite what the Governor in Council’s had to say, allowing Globalive to compete as a Canadian TCP amongst other Canadians ignores its foreign funding and expertise, and puts our national carriers at a significant disadvantage. That, according to Public Mobile, is not the intention of the TCA, and the Governor in Council trod on the rule of law by saying it was so.

Did the GC Act Within its Statutory Mandate?

The relevant statute under which both the CRTC and the Governor in Council made their decisions is the TCA. To answer this question, the Federal Court must determine (a) whether the GC’s finding of facts could be reviewed (b) what the standard is for a review of this nature and (c) what determinations were made by the GC that the Federal Court should review.

(a) Can the Governor in Council disturb a finding of fact of the CRTC?

Hughes J first flags as an issue whether the Governor in Council can disturb a finding of fact of the CRTC. Finding that the Governor in Council relied on the same set of facts as the CRTC to come to the opposite position, it was not necessary to pursue this inquiry.

(b) What is the appropriate standard of review?

In Canada (Director of Investigation and Research) v. Southam Inc., 1997 CanLII 385 (S.C.C.) the Court demonstrated how an error on a question of mixed fact and law can amount to an error of pure law, subject to the standard of correctness.  Relying on this case, Hughes J finds it is really the legal determination of the Governor in Council that we are concerned with, since it and the CRTC relied on the same set of facts. So, despite the Governor in Council’s overall inquiry being a question of mixed fact and law, Hughes J disaggregates a question of law from the overall inquiry on which he intends to focus his review.

Hughes J concludes somewhat dubiously that because we are concerned with a question of law the appropriate standard of review must be one of correctness, citing Dunsmuir. The very paragraph he cites (50) recognizes that some legal issues attract the more deferential standard of reasonableness, and the justice offers no reasons why the correctness standard is preferred in this case, and no further analysis.

(c)  The Legal Findings of the GC

The legal basis upon which the Governor in Council has stated that its Decision was made has been set out in pg. 2 of the “Whereas” clauses, in particular:

“…The Act does not impose limits on foreign investment in telecommunication common carriers and should be interpreted in a way that ensures that access to foreign capital, technology and experience is encouraged in a manner that supports all of the Canadian telecommunication policy objectives”

Hughes J finds that in many respects, the GC adhered to the policy objectives of the statute from which it derived authority to act to review the CRTC decision. In the quote above, however, it stepped outside the provisions as specifically set out in the TCA by “inserting a previously unknown policy objective into s. 7; namely, that of ensuring access to foreign capital, technology and experience” [Para 107].

The result of this, he concludes, is that because the statute defines the scope of the discretion applicable when interpreting it, and because the GC acted not within the scope of the statute, that the exercise of discretion to broaden the policy objectives of the act was arbitrary. The Federal Court of Appeal in Canada (Canadian Wheat Board) v. Canada (Attorney General), 2009 FCA 214 (CanLII) declared that it is settled law that the Governor in Council must stay within the boundaries of the enabling statute, both as to empowerment and purpose. The decision-maker must include all relevant criteria, and also exclude irrelevant criteria from consideration (Canadian Union of Public Employees (C.U.P.E.) v. Ontario (Minister of Labour), 2003 SCC 29 (CanLII) at para 172. Even decisions made in good faith are objectionable and subject to review by the Courts if the decision-maker departs from the objects and purposes of a statute pursuant to which it acts, said Cory J (as he then was) in Doctors’ Hospital and Minister of Health, (1976), 12 O.R. (2d) 164 at page 174.

Referencing the above “Whereas” clause, Hughes J finds that the GC misdirected itself in law by interpreting the ownership and control requirements of the TCA in a way that ensures access to foreign capital and technology. There is no policy objective in the Act that encourages foreign investment. What the TCA does say is that telecommunications has an essential role in the maintenance of Canadian sovereignty and identity, and provides a policy which requires Canadian ownership and control to be promoted. The intent of the TCA seems clear on this point. Whether this is a relic from a simpler time is a moot point – after all, “it is for Parliament not the Governor in Council to rewrite the Act” [Para 117].

If all that wasn’t enough, finds Hughes J, the GC was in error when it declared its Decision only applied to Globalive. He addresses Public Mobile’s concerns about equal treatment by the CRTC by flatly stating: “The Governor in Council cannot restrict its interpretation to one individual and not to others who may find themselves in a similar circumstance.”

I’ve Heard Enough: Conclusions

Thus, the Federal Court found that Public Mobile has standing to seek judicial review of the Decision of the Governor in Council, which was based on errors of law and is quashed. A stay was granted for 45 days.

Globalive and the Federal Government have announced their appeal of this decision, with Globalive arguing in their notice of appeal, filed Feb. 17, that:

“[Hughes J] erred on fact and law in failing to recognize that the Governor in Council, as it was entitled to do, considered ‘access to foreign capital, technology and experience’ to be a means to achieving Canadian telecommunications policy objectives rather than as a policy objective in and of itself.”

The issue of standing is also being appealed.

For those of you who stayed with me until the end, here are my two cents:

I hate my expensive phone contract, and would welcome WIND. As a personal matter, I hope WIND gets the go-ahead to do business here, but also I don’t think that telecommunications plays an important part in Canadian sovereignty and identity. Maybe I’d even feel better about my Canadian identity if we had some half-decent telecom providers. The TCA, however, clearly states that preserving sovereignty and identity through Canadian TCPs is an objective, and that does not mesh well with the free market’s insatiable desire for superior goods and services.

We’ll see what the FCA has to say, but one thing’s for sure: decisions pursuant to a legislative scheme that import non-existent objectives are clearly outside the scope of the executive’s power and is another example of this government blurring the lines of its own authority. Be accountable, be transparent, be forthwith – and stop trying to play fast and loose with the rules, because we (that coveted slice of the pie, Canadian citizens) are listening in.

I. Facts of Telezone and the Companion Cases

Six cases, including Telezone, hinged on the SCC’s determination of whether Grenier was good law. For your convenience, I will briefly discuss the facts of each case. In each one of them, a federal administrative decision maker sought to avoid private law claims against it by arguing that Grenier required that judicial review of its impugned decision by the Federal Court had to occur before any private law claims could be made against it. Furthermore, the judicial review had to  invalidate the decision. It is noteworthy that none of the plaintiffs actually sought to challenge the decision maker’s decision. Where the plaintiff initiated private law claims in the provincial courts the decision maker argued not only that judicial review had to occur first, but also that the Federal Court had exclusive jurisdiction.

In Telezone, Telezone Inc. initiated a claim in the Ontario Superior Court for $250 million in damages against Industry Canada for breach of contract, negligence and unjust enrichment. Telezone alleged that Industry Canada broke the rules of a call for telecommunication licence applications.

My colleague Katherine MacLellan recently wrote about Canada (Attorney General) v. McArthur, 2010 SCC 63 here. Like Grenier, that case involved an inmate claimed damages in the Ontario Superior Court for wrongful or false imprisonment, and for the intentional or negligent infliction of emotional and mental distress arising out of his stay in solitary confinement.

In Public Service of Canada v. Professional Institute of the Public Service of Canada, 2010 SCC 66, slaughterhouse operators claimed $1.8 million in damages against striking veterinarians in a labour dispute with the Canadian Food Inspection Agency (CFIA). After the veterinarians did not inspect the slaughterhouse operators’ meat, the CFIA declared that meat did not satisfy regulatory requirements and had to be destroyed. In defence, the veterinarians argued that the damages arose out of the CFIA’s decisions and measures and called the CFIA in warranty.

Last year I discussed the FCA’s decision in Manuge v. Canada, 2010 SCC 67 in detail here. After the amount he received from his disability pension was deducted monthly from the among that he received for long-term disability benefits under the Canadian Forces’ disability plan, Denis Manuge claimed among other relief, constitutional remedies, declaratory relief and damages in relation to these deductions in the Federal Court.

In Nu-Pharm Inc. v. Canada (Attorney General), 2010 SCC 65 a drug maker claimed injunctive and mandatory relief and damages for various torts against Health Canada in the Federal Court. The claims were in relation to Health Canada’s decision not to authorize the sale of the drugmaker’s product in Canada.

Finally, in Parrish & Heimbecker Ltd. v. Canada (Agriculture and Agri-Food), 2010 SCC 64, an importer claimed damages for various torts and recovery costs against the CFIA. The CFIA revoked the importer’s permits then reissued them with new conditions that made the product unacceptable to customers.

As will be discussed below, the Telezone decision determined all of these cases in favour of the plaintiffs with private law actions against federal administrative decision makers.

II. Grenier Creates Controversy

In order to understand the SCC’s decision and its significance, it is important to recall the decision in Grenier. As alluded to above, the FCA had to determine whether an inmate, Daniel Grenier, could challenge an administration decision by the institutional head of a penitentiary through an action for damages instead of judicial review. This issue was essentially one of statutory interpretation. Although many court decisions involve statutory interpretations, the decision in Grenier was particularly significant because of its implications for limitations periods and access to remedies.

According to s. 17 of the Federal Courts Act, R.S.C. 1985, c. F-7, the Federal Court has concurrent jurisdiction in all cases in which relief is claimed against the Crown. One exception to this provision is a claim for damages under the Crown Liability and Proceedings Act (17(2)(d)). However, s. 18(1)(b) of the Federal Courts Act states that the Federal Court has exclusive jurisdiction to hear any application for relief that includes “any proceeding brought against the Attorney General of Canada, to obtain relief against a federal board, commission or other tribunal.” Moreover, s. 18(3) of the Federal Courts Act states that the relief provided for in s. 18(1) may only be obtained through an application for judicial review made under s. 18.1.

According to the unanimous decision of the FCA in Grenier the combined effect of these provisions was that judicial review must be used to challenge the decision of a federal administrative body. In other words, Grenier could not initiate proceedings to seek damages for the institutional head’s decision. The FCA’s decision seemed to undercut access to justice because s. 18(2) of the Federal Courts Act requires that an application for judicial review of a decision of a federal board, commission or tribunal be made within thirty days after the decision is communicated. Since Grenier waited three years after the decision was communicated to him to initiate his action, he was effectively barred for seeking recourse for what he considered to be an “oppressive and arbitrary” decision to segregate him from the rest of the prison population.

Despite these negative implications for access to justice, Letourneau J.A. writing for the unanimous FCA was unwilling to interpret the Federal Courts Act otherwise for several reasons. First, review of the lawfulness of decisions of federal administrative bodies through an action in damages would allow a remedy under s. 17. To do so would ignore legislative intent in s. 18(3) that the remedy must be exercised only by way of an application for judicial review.

Second, the clear division of jurisdiction between the Federal Court and the provincial courts would be upset. It would be unclear where to apply for damages since s. 18(1) provides that the Federal Court has exclusive jurisdiction to hear applications for relief involving federal boards, while s. 17(2) states that the Federal Court does not have concurrent jurisdiction to hear any application for damages under the Crown Liability and Proceedings Act.

Third, the public interest would be undermined on various fronts. The public interest in the finality of decisions and the accompanying legal certainty would be destroyed. Letourneau J.A. reasoned that it was Parliament’s intent that finality be protected based on the short limitations period for judicial review. As well, the public interest not allowing collateral attacks of federal administrative decisions through tort actions would be undermined.

On the issue of collateral attacks, the FCA added that Supreme Court of Canada clearly indicated that judicial review of administrative decision making requires a determination of the appropriate standard of review. The latter signals to a reviewing court the amount of deference that a decision of an administrative decision maker should receive. Letourneau J.A. reasoned that if an action for damages were allowed to proceed rather than judicial review, then the appropriate level of deference would not be accorded to the decision of an administrative decision maker.

In summary, Grenier was a significant precedent because it precluded private law claims against federal administrative decision-makers in relation to impugned decisions where judicial review was not sought first. As well, the decision was overextended so that the Federal Court had exclusive jurisdiction over such claims.

III. The SCC Rejects Grenier

Writing for the unanimous seven judge panel in Telezone,  Binnie J. overturned the principle in Grenier and clarified the state of the law. Upholding the lower provincial courts’ decisions, he held that s. 17 of the Federal Courts Act and s. 21 of the Crown Liability and Proceedings Act conferred concurrent jurisdiction on the superior courts and the Federal Court for claims against the Crown. He also held that it was unnecessary for claimants to seek judicial review of federal administrative decision makers’ decisions before they could seek private law claims. To uphold Grenier and require judicial review by the Federal Court would be contrary to access to justice. If claimants do not wish to challenge a federal administrative decision and seek compensation for alleged damages, then there is no reason to force them to jump through the additional hoop of judicial review.

IV. The Proper Interpretation of the Federal Courts Act

Binnie J. rejected the interpretation of the Federal Courts Act in Grenier based on the overarching principle of Parliamentary intent. At paragraph 22, he wrote that it was Parliament’s intention to have concurrent jurisdiction in all cases in which relief is claimed against the federal Crown. The subject matter overlap in ss. 17 and 18 of the Federal Courts Act was meant to provide claimants with convenience and a choice of forum.

At paragraph 42, Binnie J. added that the derogation of jurisdiction requires clear and explicit statutory language. Since there was no such language, exclusive jurisdiction by the Federal Court was implausible. In particular, the language in s. 18 does not oust the superior courts’ jurisdiction. The “exclusive jurisdiction” accorded to the Federal Court is over prerogative writs, declarations, and injunctions federal administrative decision makers. Disagreeing with the FCA in Grenier, he emphasizes that s. 18

does not say that a dispute over the lawfulness of exercise of statutory authority cannot be assessed in the course of a trial governed by the Crown Liability and Proceedings Act brought in the provincial superior court or pursuant to s. 17 of the Federal Courts Act itself.

In addition to the lack of explicit language ousting the superior courts’ jurisdiction, he adds at paragraph 51 that s. 18 merely provides a grant of exclusive jurisdiction to judicially review federal administrative decisions. Further, the remedies in s. 18 do not include an award for damages. The unfairness and arbitrariness of the procedure advocated by the Attorney General is implicit in that observation. A claimant cannot seek damages in an application for judicial review. It is contrary to access to justice to require  that a claimant waste time and money going to the Federal Court for judicial review of a decision that it has no interest in so that it can satisfy a pre-condition to making a damages claim in the provincial courts.

Access to justice is also impeded by the short limitations period in s. 18. Recall that s. 18 requires applicants to make an application for judicial review within thirty days of a decision being communicated to it. One problem with that provision is that, as noted by colleague James Gotowiec here, s. 18 does not incorporate the discoverability principle. The latter is a principle which states that the limitations period starts ticking when a person obtains knowledge of his or her potential cause of action. Section 18 would preclude a person that obtains knowledge about their cause of action after that short period from seeking damages. Although he does not explicitly addresses the lack of the discoverability principle, Binnie J. did note that a thirty day cut-off to file a damages claim is unrealistic. As well, consistent with the rest of the decision, he added that that s. 18 is designed to facilitate access to justice. The short limitations period in s. 18 is designed to facilitate a quick and summary judicial review procedure and not designed to address a private law action for damages.

V. The Doctrine of Collateral Attack

The Attorney General’s support for Grenier based on the doctrine of collateral attack also fell apart before the SCC. To begin its analysis, the SCC quoted the following excerpt from Garland v. Consumers’ Gas Co., 2004 SCC 25:

The fundamental policy behind the rule against collateral attack is to “maintain the rule of law and to preserve the repute of the administration of justice” (R. v. Litchfield, [1993] 4 S.C.R. 333, at p. 349).  The idea is that if a party could avoid the consequences of an order issued against it by going to another forum, this would undermine the integrity of the justice system.  Consequently, the doctrine is intended to prevent a party from circumventing the effect of a decision rendered against it. [Emphasis added.]

Among other things, the SCC noted that Telezone Inc. was not attempting to avoid the consequences of Industry Canada’s decision. Instead, its alleged financial losses constitute the foundation of its damages claim.

VI. Floodgates vs. Gate keeper

In my post on Manuge here, I was concerned that overturning Grenier would open up the floodgates to the provincial courts and create chaos. My observation that the jurisdiction between the Federal Court and the provincial courts would be muddied and that people would wage collateral attacks that undermine the principles of finality and legal certainty was consistent with the position of the Attorney General. The SCC’s decision in Telezone eases these fears.

The SCC’s reasoning illuminates why Grenier is bad law that needed to be overturned. With the benefit of the SCC’s decision, it is now clear that it is contrary to access to justice and irrational to require claimants to seek judicial review first in order to claim damages against a federal administrative decision maker. Collateral attack is not a great concern because the claimant is not trying to get around the decision – rather, in those circumstances where the claimant accepts the decision and yet feels aggrieved by it, it should be able to seek damages notwithstanding the identity of the decision-maker as a federal body. The concern should be over the waste of scare judicial resources on litigation that claimants must undertake so that it can access the provincial courts. Further, affirming Grenier would not completely avoid the mudding of jurisdiction since federal administrative decision makers would still have to appear before the provincial courts after judicial review was completed.

The SCC correctly saw through the Attorney General’s use of Grenier to gate keep access to the provincial courts so that federal administrative decision makers would be shielded from civil liability.  While there is some merit to the argument that this decision will open floodgates of civil liability, that argument should not overshadow the fact that the decision serves to increase access to justice by eliminating a needless and time-sensitive two step process.  Furthermore, it is possible that this decision will increase the accountability of federal administrative decision makers because they will no longer be shielded from civil liability. On the other hand, the ability of decision makers to make decisions in an impartial manner may be compromised. It is possible that decision makers will let the potential for civil liability sway their decision making. However, that possibility does not signal the end of days for administrative decision makers. As noted by the SCC, decision-makers can rely upon the defence of statutory authority to protect themselves. Coupled with the ability of the courts to see through crafty pleadings that mask a collateral attack so that the provincial courts can be accessed, the existing safeguards favour the approach in Telezone.