Courts of three provinces – Ontario, BC and Nova Scotia – have been grappling with the power of professional regulatory bodies to address public interest concerns by refusing to certify programs of schools with discriminatory policies. These courts have reached different conclusions where Trinity Western University, a Christian university in British Columbia, requires that students – including students of its law school – sign a covenant requiring that they abstain from sexual intimacy outside of marriage between one man and one woman. Most recently, the BC Court of Appeal affirmed a lower court decision ((2015 BCSC 2326, here)) that set aside of a decision of the Law Society of British Columbia: Trinity Western University v. Law Society of British Columbia, 2016 BCCA 423.
The Court of Appeal decision involves two separate branches.
The LSBC decision under administrative law: The first branch relates to the invalidity of the Law Society’s decision refusing to accredit TWU’s law school, based on the community covenant. In 2014, the Law Society’s Benchers resolved to be bound by a referendum in which a majority of members voted against accrediting the law school. Based on the referendum results, the Benchers passed a resolution declaring that TWU’s law faculty was not approved.
The Court of Appeal held that the Law Society has broad statutory objectives, including “preserving and protecting the rights and freedoms of all persons.”  It accepted that LSBC did not have to base its decision on considering “academic qualifications” alone, and could consider an admissions policy. The Benchers failed, however, to exercise their power to agree or decline to accredit properly. While the Benchers did not improperly sub-delegate their decision-making power (since they still exercised their power to decline to accredit TWU’s law school after the referendum vote) , the Benchers had improperly fettered their decision-making power by considering themselves bound by the referendum vote. While one provision of the Legal Profession Act (s. 13) allowed members to adopt resolutions binding on the Benchers under certain conditions, the Benchers had to weigh the statutory objectives of the LPA against Charter values, and make a decision that “best protected Charter values without sacrificing important statutory objectives.”  The Benchers failed in this duty, and improperly fettered their discretion.
Whether any decision to refuse to accredit TWU’s law school could be constitutional: The second branch of the decision relates to the decision that the Law Society ought to have made. While ordinarily a court would have remanded such a matter back to the Benchers so that they could properly exercise their statutory discretion, the Court of Appeal made the remarkable decision that it could decide the matter in favour of TWU, on the basis that no other outcome was reasonably possible. 
The heart of the dispute was whether the Law Society’s refusal to accredit TWU’s law school because of the covenant, which infringed freedom of religion under section 2(a) of the Charter of Rights and Freedoms, could be justified by the Law Society acting to prevent impacts of accreditation on the quality rights of LGBTQ persons under section 15 of the Charter.
The Court reviewed the frameworks outlined in Dore and Loyola, which apply where administrative decision-makers are faced with decisions involving Charter rights and values. Applying these frameworks, it expressed the balancing exercise this way: “did the decision of the Law Society not to approve TWU’s faculty of law interfere with freedom of religion…no more than is necessary given the statutory objectives of the Law Society?”  The Court identified these statutory objectives as the “public interest in the administration of justice” and “preserving and protecting the rights and freedoms of all persons.” 
The Court concluded the impact of the decision on TWU’s right to religious freedom was severe. The Court also found that, in principle, TWU’s law school approval would have a detrimental impact on LGBTQ [lesbian, gay, bisexual, transgender and queer] equality rights. In reality, though, very few LGBTQ students would wish to apply to TWU, and so the actual impact on applications made by LGBTQ students to law schools would be “insignificant in real terms.”  The Court also found that approving the law school would not amount to the Law Society endorsing discrimination against LGBTQ individuals. Ultimately, the Court found: “In light of the severe impact of non-approval on the religious freedom rights at stake and the minimal impact of approval on the access rights of LGBTQ persons to law school and the legal profession, and bearing in mind the Dore obligation to ensure that Charter rights are limited “no more than is necessary”, we conclude that a decision to declare TWU not to be an approved law faculty would be unreasonable.” 
This result may be contrasted with the decision of the Ontario Court of Appeal, which found that the Law Society of Upper Canada’s decision not to accredit TWU was reasonable and constitutional (2016 ONCA 518, summarized here).
Given the conflicting appellate approaches in Ontario and British Columbia, the matters seem likely to proceed to the Supreme Court of Canada.
Trinity Western University v. Law Society of British Columbia, 2016 BCCA 423
Lisa C. Fong and Michael Ng