May 12, 2021

The duty of regulatory decision-makers to grapple with key issues in reasons

Administrative Law
Inquiry and Investigations
Professional Regulation

Where a regulatory authority makes a decision by strictly following a policy, but otherwise does not provide reasons, a court may set the decision aside for lack of justification and transparency. The court generally ought, however, remit the matter so that the authority may make a new decision, instead of deciding the matter itself: Party A v. Law Society of British Columbia, 2021 BCCA 130.

The Court of Appeal considered the role of reviewing courts after the Law Society of British Columbia decided to issue a citation against a lawyer, and the lawyer asked the Executive Director to exercise discretion to publish the citation anonymously. The Executive Director refused, based on a practice of current- and former-Executive Directors that anonymity should be granted”only in rare and exceptional cases where one or more individuals would suffer extraordinary prejudice to such an extent that it would outweigh the public interest in having the Law Society carry out its discipline processes in a transparent and accountable manner.” The Executive Director decided that the circumstances “fall well short of meeting that threshold….”

On judicial review, the initial chambers judge decided that the Executive Director acted unreasonably, by mechanically applying an inappropriate test, [14 & 15] by failing to address key arguments, [15] and by failing to meaningfully address the serious risk of irreparable damage to the petitioner’s reputation. [14] The chambers judge quashed the decision, but declined to remit the matter, and instead restrained the Executive Director from publishing the lawyer’s name. [16]

On standard of review, the Court of Appeal held that the chambers judge had misunderstood reasonableness review. The judge’s task was not to decide what policy or “yardstick” should be applied to the anonymizing of citations. [29; 32-43]

The Court of Appeal went on to confirm the finding of the chambers judge that the decision of the Executive Director was unreasonable. First, by apparently followed a “practice” of former executive directors, the Executive Director fettered his discretion by simply following a policy that was not (at the time of the decision) made known to members. [66] Second, the Executive Director did not grapple with issues raised by the lawyer. [65] Accordingly the decision failed to demonstrate the requisite justification and transparency. [66]

The chambers judge improperly failed, however, to remit the matter to the Law Society for a new decision. The Court of Appeal appeared to find the reasons of the chambers judge for refusing to remit the matter were themselves inadequate: “[69] The judge did not explain why this was one of the limited scenarios in which the court should not respect the legislature’s intention to entrust the matter to the administrative decision maker.”

The court noted that two new factors that might complicate any new Law Society decision: first, that the lawyer succeeded on a petition to the court for a finding that he had a right as a trustee to take fees from trust without court approval, which was a matter at issue in the citation; and second, that the policy referenced by the Executive Director was later codified into one of the Law Society’s rules. However, the appropriate outcome was still an order that the matter be remitted to the Law Society for a new decision. [69-72]

Party A v. Law Society of British Columbia, 2021 BCCA 130.

Lisa C. Fong, Q.C. and Michael Ng