March 10, 2011

Our Pick for the Top Five Administrative Law Cases in 2010

Administrative Law

Writing this blog entry seemed easy at first but when we started to review 2010 cases and favourite lists put out by different law firms, it became clear to us that selecting amongst the large number of cases covering a wide expanse of administrative law areas, would not be a simple task.  And so after much deliberation and pie consumption, we decided to pick the top five cases that represented what we viewed as the key developments in administrative law in 2010.  In making our selection, we were influenced by administrative lawyer extraordinaire, Mike Stephens and his list of 18 administrative law cases for the year 2010.  He presented on the cases on his list at the BC CBA administrative law subsection meeting on February 1, 2011 and a link to his list is here.

We thank Christian Morey, our firm’s articled student for valiantly wading through the vast number of cases we had to select from and contributing to the writing of this blog entry.

1. R. v. Conway, 2010 SCC 22:  A New Test for When Administrative Tribunals Have the Jurisdiction to Award Charter Remedies

In this case, the Supreme Court of Canada sets out the new, “Conway Test” for establishing when administrative tribunals have the power to consider and award Charter remedies. While  the “Conway Test” is new, the legal framework for the test has been building through a series of SCC cases for more than a decade, most notably Slaight Communications Inc. v. Davidson [1989] 1 SCR 1038, Cuddy Chicks Ltd. v. Ontario (Labour Relations Board), [1991] 2 SCR 5, and Weber v. Ontario Hydro [1995], 2 SCR 929.  The Conway Test will be extremely helpful to the many administrative tribunals who have the jurisdiction to hear, decide, and award Charter remedies.

The applicant in this case had been detained in various mental health facilities in the province of Ontario since 1984, when he was found not criminally responsible by reason of mental disorder on a charge of sexual assault with a weapon. [9] In 2006, the applicant argued before the Ontario Review Board that his ongoing confinement was in violation of several of his Charter rights. [12] The Board found that the applicant still posed a significant threat to public safety, and that it had no jurisdiction to provide constitutional remedies under section 24(1) of the Charter. [15] On these grounds, the Board ordered that the applicant should remain confined and should continue to receive treatment. In its judgment on appeal, the Supreme Court of Canada affirmed this outcome. However, in arriving at this result, the Court applied a new test for determining the Board’s jurisdiction over constitutional questions. This new test represents a significant change in the law regarding the availability of constitutional remedies in administrative proceedings.

Section 24(1) of the Charter provides that persons whose rights have been violated may apply to “a court of competent jurisdiction” for relief. Prior to Conway, an administrative tribunal was deemed to be possessed of such jurisdiction if it had jurisdiction over the parties, the subject matter, and the remedy sought, although in practice the emphasis was always placed on the final component of this test. [40] The question of whether a tribunal could apply s. 52(1) of the Constitution Act, 1982 in determining that a law is “of no force and effect” was addressed in a separate body of cases. The result of these cases was to establish that a tribunal empowered to decide questions of law had the authority, and the duty, to consider the constitutionality of laws under its consideration, unless this jurisdiction was explicitly limited by its enabling statute. [77]

Under the new test set out in Conway, the availability of remedies under s. 24(1) is to be determined by a two-stage test that merges the main points of inquiry identified above. The first stage of the test is to determine whether the tribunal is empowered to consider questions of law generally, and whether this power is explicitly limited to exclude consideration of the Charter. [81] If the tribunal is found to have such powers, the second stage is to ask whether, as a matter of legislative intent, the power to award the particular remedy sought is consistent with the purposes of the enabling statutory framework as a whole. [82]

2. Carrier Sekani Tribal Council v. British Columbia (Utilities Commission), 2010 SCC 43: When Administrative Tribunals have the Duty to Consult First Nations

In this case, the Supreme Court of Canada establishes the test for when an administrative tribunal has a duty to consult First Nations.  We anticipate this case to have far reaching effects on natural resource administrative tribunals and other administrative tribunals that engage aboriginal rights under s. 35(1) of the Charter.

This case arose out of a dispute dating back to the 1950s, when the province of British Columbia authorized the construction of a dam that had the ancillary effect of altering the flow of the Nechako River. Prior to this development, the Nechako River had been a source of water and fish for the Carrier Sekani First Nations since time immemorial. [1] In 2007, the province entered into an Energy Purchase Agreement (“EPA”) with the dam’s corporate owners. [5] This agreement was subject to review by the B.C. Utilities Commission. In the course of such a review, the Carrier Sekani Tribal Council argued that they had the right to be consulted regarding the decision to enter into the EPA, in keeping with the Crown’s constitutional duty to consult as set out in Haida Nation v. British Columbia (Ministry of Forests). [6] The Commission found that, as a Crown entity, it was subject to the duty to consult, but held that the duty did not apply in this instance, as its decision would not adversely affect the First Nations’ interests. [16] The Court of Appeal reversed this finding, however, and the matter came before the Supreme Court of Canada.

The reasons given by the Court are in substantial agreement with those provided by the Commission: the Court held that, because the adverse effect on the First Nations’ interests had been the result of the dam’s original construction, and no new adverse effects were at stake in the Commission’s decision, no consultation was necessary in this case. [76] However, The Court did find that the duty to consult could apply to administrative decision-makers under appropriate circumstances. [56] In order to determine whether or not a specific administration decision-maker is empowered to consult with First Nations in such a way as to satisfy the Crown’s duty to consult, courts should first apply the test set out in Conway to determine whether or not the tribunal has jurisdiction to consider constitutional questions, including the question of whether or not the duty to consult has been triggered. [58] Even if the tribunal has such jurisdiction, however, it does not necessarily follow that the tribunal is empowered to engage in consultation on the Crown’s behalf. A tribunal may act to satisfy the Crown’s duty to consult only if such activities fall within the range of the tribunal’s prescribed  remedial powers, as set out in its enabling statute. [60] In the event that an administrative decision maker is not empowered to satisfy the duty to consult, First Nations must seek consultation through other venues, and, if necessary, pursue the matter through the courts. [63]

One other intriguing aspect of this case, albeit not one that is about administrative law, is the Court’s indication that past and continuing breaches should be remedied through negotiation. [83] This suggests some sort of unique cause of action in civil law for damages which will undoubtedly result in some novel cases.

3. Little Salmon/Carmacks First Nation v. Yukon (Director, Agriculture Branch, Department of Energy, Mines & Resources), 2010 SCC 53:  An Administrative Decision Maker’s Continuing Duty to Consult First Nations.

This case follows on the tail of the Carrier Sekani and provides some guidance to administrative decision makers on the extent of their continuing duty to consult First Nations.  While the facts of the case involve consultation in the circumstances of a treaty agreement, the principles underlying why the duty continues could prove to be applicable to other situations where the Crown and a First Nation have entered into an agreement.

In another case involving the duty to consult with First Nations, the Supreme Court of Canada considered whether or not compliance with the consultation provisions of a finalized modern treaty were sufficient to satisfy the honour of the Crown in all cases. The case arose when the Yukon territorial government granted a parcel of surrendered land to a private citizen for agricultural use. [16] Although the First Nation in this case had given up any claim of title to the land, they retained the right to hunt for sustenance on the land surrendered so long as it remained in Crown hands. [56] The First Nation sought a review of the land grant decision, on the ground that they had not been consulted, and that the decision had an adverse effect on their interests. The territorial government countered that the consultations provisions of the treaty were intended to be a complete agreement, and that this agreement excluded any further duty to consult. [50]

The Court ultimately decided that the notice given to the First Nation, as well as the opportunity to makes its concerns known to the decision-maker, meant that the First Nation had not made out its case. [7] However, the Court rejected the notion that the Crown could “contract out” of the duty to consult. [61] As the Court observed, the duty to consult is grounded in the honour of the Crown, which continues to animate relations between the Crown and First Nations even once treaties are concluded. [71] This principle means that treaties are not to be interpreted in a context-neutral fashion, in the same manner as commercial contracts. [10] Instead, when considering an action that could adversely affect an interest held by a First Nations, the Crown has an ongoing duty to take those interests into account in reaching its decision. [73] On the other hand, the Court stopped short of finding that the duty to consult implied a corresponding constitutional right to be consulted, which could only be infringed under the test set out in R v. Sparrow. [44] Rather, the court held that the duty to consult could be considered in the context of the other duties that are binding on administrative decision makers, including the duty of procedural fairness. [47] The duty requires the decision maker to be fully informed as to the interests at stake, but it does not require that the adverse effect on these interests should be minimized. [74]

4. MiningWatch Canada v. Canada (Minister of Fisheries & Oceans), 2010 SCC 2: Courts Not Bound by Statutory Remedies that Bind Administrative Tribunals.

This is an extraordinary case where the Supreme Court of Canada awarded a lesser remedy that was not available under the subject statute.  This case opens up the possibility of courts providing more practical and fitting remedies than an administrative tribunal which is bound to the remedies set out in its constituent statute.

This case involved a dispute over interpretation of the Canadian Environmental Assessment Act. The appellants, a non-profit advocacy group, had taken issue with a decision by the Department of Fisheries and Oceans to forgo a full environmental assessment of a proposed mining project, on the basis that certain parts of the overall undertaking were excluded from the scope of the project as determined by the Department. [6] The applicant sought review on the grounds that this “scoping” was an improper exercise of discretion, and that the project as a while should have been the subject of a full environmental assessment. In the result, the Court found that the applicant’s concerns were well-founded. [42]

The most interesting aspect of this case is the Court’s ruling with respect to the appropriate remedy. The Court’s finding was that the screening undertaken by the Department did not satisfy the requirements of the statute, and that a full assessment should have been done. However, on the facts of the case, an assessment had already been completed by the province, and the applicant had explicitly stated that it had pursued this litigation as a test of the provisions of s. 21 of the Act, rather than out of concerns regarding the particular project itself. [49] Moreover, the Court found that the mining corporation itself had done nothing wrong – it had complied with all the relevant statutory requirements, and only the government’s conduct was at issue. [47] For this reason, the Court issued a declaration that the Department had erred in its choice of scope, but declined to order that a full assessment should be completed. [53]

This choice of remedy is significant because it is less than what the applicant would ordinarily have been entitled to under the terms of the statute. The Court acknowledged that this choice raises serious issues with respect to the principle of rule of law, in that courts are normally bound to give effect to the remedies prescribed by statute. Under the unusual circumstances of this case, where the applicant was not seeking the prescribed remedy, and no third parties were prejudiced by the decision to depart from the statutory rule, the Court found that a lesser remedy was warranted. However, the Court noted that this exercise of inherent jurisdiction should only be applied with “the greatest of care”. [52]

5. Catalyst Paper Corp. v. North Cowichan (District), 2010 BCCA 199: Decisions of Elected Bodies are Reviewed on a Reasonableness Standard.

Because we can’t get enough of Dunsmuir, we included this case that establishes decisions made by elected municipal bodies are reviewed on a reasonableness standard.

This case arose out of a dispute between a British Columbia municipality and the corporate owner of a paper recycling plant. Under the Community Charter, local municipalities are entitled to set property tax rates at their own discretion by passing appropriate bylaws.[9]  As a result of the tax rate set by the municipality, the corporation in this case was required to pay nearly seven  million dollars in municipal taxes, an amount that it argued was far in excess of the services it received in return. [24] In response to economic difficulties, the corporation decided to pay only 1.5 million dollars in tax, and sought a declaration that the chosen tax rate was unreasonable and hence ultra vires. [6] This argument was rejected at trial; however, the corporation chose to pursue the matter before the Court of Appeal.

As creatures of provincial statute, municipal bodies are bound by the usual rules of administrative law. In particular, while many provinces have legislation that prevents municipal bylaws from being reviewed by the courts on administrative law grounds, British Columbia has no such law. For this reason, municipal resolutions have been challenged as being ultra vires in prior cases such as Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231 (S.C.C.) and Pacific National Investments Ltd. v. Victoria (City), 2000 SCC 64, [2000] 2 S.C.R. 919 (S.C.C.). [14] However, this was the first case to be considered since the revision of the standard of review test set out in Dunsmuir v. New Brunswick. The Court therefore considered whether the bylaw was “reasonable” within the meaning of that test. [35]

The Court’s analysis emphasized the importance of deference to elected bodies in reviewing municipal legislation. Although in principle the standard of review is one of reasonableness, the Court found that this standard is “coloured” by this principle of deference. [36] For this reason, the Court rejected the appellant’s argument that the bylaw must be enacted as part of an overarching rational policy, or that it must be rational in light of tax rates established in previous years. [33] Rather, a bylaw will be found to be unreasonable only if it is one “that no reasonable authority, acting within the four corners of its jurisdiction, could have decided to impose”. [39]