October 30, 2010

Regulator policies must comply with enabling provisions

Administrative Law
Professional Regulation

Where a statutory provision provides for a matter to be in accordance with the policies of a board, the policy must still be within the jurisdiction conferred by statute. This principle was applied to invalidate an unduly restrictive policy in Viking Logistics Ltd. v. British Columbia (Workers’ Compensation Board), 2010 BCSC 1340 (September 22, 2010), a case where an employee was entitled to a refund of premiums following a review, giving rise to the extent of its entitlement to interest on monies refunded. The statute provided for interest “calculated in accordance with the policies of the board of directors” under s. 259(2) of the Workers’ Compensation Act. The board policy provided, however, only for interest from the start of the formal appeal, and did not provide for interest on monies retained during the lengthy process of informal review.

The Board provided interest according to its policy, and that decision was upheld by the Workers’ Compensation Appeal Tribunal. The BC Supreme Court found, however, the policy to be patently unreasonable within the meaning of s. 58(2) and (3) of the Administrative Tribunals Act (which statutory standard continues to apply to matters within the WCB’s exclusive jurisdiction, despite Dunsmuir v. New Brunswick, 2008 SCC 9).

The statute required a policy on interest to be calculated “on that refunded amount” and did not permit the board to undermine the obligation to pay interest through the calculation of that interest. Although the WCB was entitled to great deference in interpreting its own statute, the decision under review did not engage in an interpretation of s. 259(2). Accordingly the WCAT decision gave no defensible reason to explain the conclusion that the Board had authority to make a policy depriving an employer of interest for significant periods.

Viking Logistics Ltd. v. British Columbia (Workers’ Compensation Board), 2010 BCSC 1340 (September 22, 2010)