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Federal regulatory boards

There was no basis to interfere with agency’s determination

Canada Transportation Act provided for maximum revenue entitlements (MREs) for movement of western grain by prescribed railway companies. Sections 150 and 151 of Act provided for assessment of MREs by Canadian Transportation Agency for each crop year. Agency’s approach to calculating MREs had been disadvantageous to railway since 2001. Agency’s MRE determination for railway for 2013-2014 crop year resulted in railway being required to pay $4,981,915 that it received in excess of its MRE, plus $249,096 penalty, to Western Grains Research Foundation. Agency changed its approach to calculating MREs starting in 2014-2015 crop year. Railway appealed from MRE determination for 2013-2014 crop year. Appeal dismissed. Railway failed to establish agency’s interpretation and application of Act were unreasonable. Despite fact that agency’s interpretation and application of Act had withstood court’s scrutiny in past, counsel for railway devoted significant time to this issue. There was no convincing basis given to interfere with agency’s determination. Agency’s interpretation and application of its own statute was possible and acceptable outcome in light of facts and law. Railway failed to establish any violation of procedural fairness in agency’s consultation process and in agency not considering in its MRE determination railway’s late submission made in that consultation process.
Canadian National Railway v. Canadian Transportation Agency (2016), 2016 CarswellNat 5676, 2016 FCA 266, Johanne Trudel J.A., Richard Boivin J.A., and Yves de Montigny J.A. (F.C.A.).

Environmental Law

Statutory protection of environment

Environmental assessment

Environmental Protection Act conferred significant discretion on Minister

Genetically engineered organisms. Biotechnology company A Inc. owned rights to genetically engineered Atlantic salmon which grew to market size significantly more rapidly than wild or farmed salmon. A Inc. proposed to produce sterile, all-female salmon eggs for export to facility in Panama. Ministers of Environment and Health determined A Inc.’s salmon was not toxic or capable of becoming toxic and granted A Inc. waiver from obligation to provide certain information under Environmental Protection Act. Minister of Environment issued notice in Canada Gazette indicating scope of activities permitted and advising that any other activities would require separate consideration. Federal Court dismissed public interest group’s application for judicial review. Federal Court determined that Ministers’ decisions were made in manner prescribed by Act and were reasonable, that Ministers reasonably decided A Inc.’s salmon was not toxic or capable of becoming toxic, and that Ministers considered information with respect to potential uses and locations of introduction of A Inc.’s salmon. Federal Court held that publication of notice of waiver occurred within reasonable time, that Act did not provide for public participation in toxicity assessments, that Minister of Environment’s publication of notice of permitted activities was reasonable, that Notice was not overbroad, and that anyone seeking to engage in same activities in another location would still have to file notice and undergo new assessment. Public interest group appealed. Appeal dismissed. Federal Court committed no error warranting court’s intervention. Act conferred significant discretion on Minister and decision was entitled to deference. Group failed to show it was unreasonable for Minister to conclude that potential for exposure to environment could be prevented. Scope of SNAc Notice could not be said to be overly broad or unreasonable. There was no absurdity or unreasonableness in Minister issuing SNAc Notice permitting wider range of uses of AAS than that permitted by s. 106(10). Finally, Federal Court did not breach duty of procedural fairness by arriving at own interpretation of legislation. Procedural fairness required that parties be able to make submissions about issues of statutory interpretation, but court’s ability to decide issues correctly was not constrained by parties’ submissions.
Ecology Action Centre v. Canada (Minister of the Environment and Climate Change) (2016), 2016 CarswellNat 5289, 2016 FCA 258, Nadon J.A., Eleanor R. Dawson J.A., and Woods J.A. (F.C.A.); affirmed (2015), 2015 CarswellNat 10968, 2015 CarswellNat 7756, 2015 FC 1412, 2015 CF 1412, Russel W. Zinn J. (F.C.).

Judges and courts


Exchequer and Federal Courts

Federal Court did not have jurisdiction over claim

Applicant, which was incorporated by special Act of Parliament, An Act to incorporate The Canadian Transit Company (“CTC Act”), owned and operated Canadian half of Ambassador Bridge connecting respondent city and Detroit, Michigan. Applicant had purchased more than 100 residential properties in respondent city with intention of eventually demolishing homes and using land to facilitate maintenance and expansion of bridge and its facilities. Respondent city issued repair orders against properties pursuant to municipal bylaw. Applicant applied to Federal Court for declarations to effect that applicant had certain rights under CTC Act which superseded bylaw and any repair orders issued under it. Respondent city brought successful motion to strike applicant’s notice of application on ground that Federal Court lacked jurisdiction to hear application, and applicant successfully appealed. Respondent city appealed. Appeal allowed. Federal Court did not have jurisdiction to decide whether respondent city’s bylaws applied to applicant’s residential properties. In order to decide whether Federal Court had jurisdiction over claim, it was necessary to determine essential nature or character of that claim. Stated generally, issue was whether Federal Court had jurisdiction to decide claim that municipal bylaw was constitutionally inapplicable or inoperative in relation to federal undertaking. First part of three-part test for jurisdiction, which required that federal statute grant jurisdiction to Federal Court, was not met. Applicant was not seeking relief “under an Act of Parliament or otherwise” as required by s. 23(c) of Federal Courts Act, and s. 23(c) of Federal Courts Act therefore did not grant jurisdiction over this application to Federal Court.
Windsor (City) v. Canadian Transit Co. (2016), 2016 CarswellNat 6466, 2016 CarswellNat 6467, 2016 SCC 54, 2016 CSC 54, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); reversed (2015), 2015 CarswellNat 4835, 2015 CarswellNat 816, 2015 FCA 88, 2015 CAF 88, Eleanor R. Dawson J.A., David Stratas J.A., and A.F. Scott J.A. (F.C.A.).



Privileged communications

Litigation privilege invoked by insurer could be asserted

Litigation privilege. Fire damaged residence and one of insurer’s claims adjusters investigated claim. Syndic of Chambre de l’assurance de dommages later received information to effect that adjuster had made certain errors in managing file. In course of her inquiry, syndic asked insurer to send her complete copy of its claim file. Insurer refused to do so on basis that some of requested documents were protected by litigation privilege. Syndic filed motion for declaratory judgment, arguing that s. 337 of Act respecting the distribution of financial products and services (Que.) created obligation to produce “any (…) document” concerning activities of representative whose professional conduct was being investigated. Syndic further argued that litigation privilege should be applied more flexibly than solicitor-client privilege as it was less important. Trial judge concluded that litigation privilege could not be abrogated absent express provision and syndic appealed. Court of Appeal upheld trial judge’s judgment. Syndic appealed before Supreme Court of Canada. Appeal dismissed. Litigation privilege is fundamental principle of administration of justice . It is class privilege that exempts communications and documents that fall within its scope from compulsory disclosure, except where one of limited exceptions to non-disclosure applies. Any legislative provision capable of interfering with litigation privilege should be read narrowly. Legislature may not abrogate that privilege by inference, but may only do so using clear, explicit and unequivocal language. Because s. 337 of Act provided only for production of “any (…) document” without further precision, it did not have effect of abrogating privilege. It followed that insurer was entitled to assert litigation privilege in this case and to refuse to provide syndic with documents that fell within scope of litigation privilege. None of exceptions to its application justified lifting privilege in this case. Therefore, courts below were right to hold that litigation privilege invoked by insurer could be asserted against syndic.
Lizotte c. Aviva Cie d’assurance du Canada (2016), 2016 CarswellQue 10692, 2016 CarswellQue 10693, 2016 SCC 52, 2016 CSC 52, McLachlin C.J.C., Abella J., Cromwell J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., and Brown J. (S.C.C.); affirmed (2015), 2015 CarswellQue 384, 2015 QCCA 152, Bich J.C.A., St-Pierre J.C.A., and Gagnon J.C.A. (C.A. Que.).

Criminal Law


Sexual assault

Fresh evidence was relevant to complainant’s credibility

Accused was convicted of sexually assaulting and uttering death threats to his former partner over period of 26 months. Complainant claimed accused forced himself on her three times but he insisted sex was consensual. To bolster his defence, accused raised issue of Facebook message sent in February 2009 by complainant to his new partner and current wife. At trial in 2011, complainant maintained she had no memory of sending message and testified she did not think she did so. Following Crown objecting on procedural grounds, trial judge ruled against further cross-examination and directed jurors to set aside evidence they had heard about post. Accused appealed and requested permission to introduce fresh evidence, with Crown not objecting. Appeal allowed; Conviction quashed and new trial ordered. Submissions of expert forensic analyst of computer belonging to accused’s current wife turned up relevant message on her Facebook account with no manipulation of date and content. Message was sent around midpoint in time period of sexual assault allegations and court held it would not be unfair to say message recounted several incidents of sexual activity between accused and complainant and made it clear that sexual activity was consensual on complainant’s part. Further, message was found to have come from computer address associated with complainant’s brother and when complainant was interviewed about results of investigation, she acknowledged sending message. Had message been allowed at trial, it could have affected accused’s conviction. Fresh evidence was relevant to complainant’s credibility on issue of consent, which was only controversial element at trial. At request of Crown and defence, court stayed new trial order.
R. v. B. (A.) (2016), 2016 CarswellOnt 17301, 2016 ONCA 830, J.C. MacPherson J.A., E.A. Cronk J.A., and David Watt J.A. (Ont. C.A.).

Criminal Law

General principles


Fresh evidence of identity documents was not admissible

Based on age of accused. Four deceased family members were found in car submerged in water in canal system. Three other family members, S, T, and H, were each convicted of four counts of first degree murder. Accused contended that H should not have been tried with other accused, his parents, because he was too young to be tried as adult. H sought to admit fresh evidence as to proof of age. Accused appealed. Appeals dismissed. Fresh evidence of three identity documents was not admissible and effect was not to be given to remedies sought as consequence of their proposed reception. When deceased were killed, H was not “young person” as defined in s. 2(1) of Youth Criminal Justice Act. Jurisidictional challenges advanced first time on appeal were exceptional, all more so when information necessary to ground challenge was within peculiar knowledge of accused and his parents who, when asked, said he was 18. Compelling evidence was not provided to show that H was “young person”. Since proposed evidence did not go to findings of fact essential to determination of guilt or adjudicative fairness, greater emphasis was placed on avoiding “gaming the system” by challenge to jurisdiction on appeal after adverse verdict at trial. Principal evidence tendered for admission, tazkira document, would not be admissible under adjectival law if tendered on jurisdictional challenge at trial. As proof of H’s age, document was hearsay, its author and time of relevant entry being unknown, and even double hearsay if source was unknown “local representative”. Birth date of December 31, 1991 was asserted solely on basis of “new” document and despite lengthy history of consistent and repeated representations, some in sworn declarations to gain entry into various countries including Canada, that H was born on December 31, 1990.
R. v. Shafia (2016), 2016 CarswellOnt 17126, 2016 ONCA 812, David Watt J.A., P. Lauwers J.A., and G. Pardu J.A. (Ont. C.A.).

Debtors and Creditors


Actions involving receiver

Action against court appointed receiver was stayed

Order was made staying action as against court appointed receiver and refusing leave to sue receiver. Plaintiff appealed. Appeal dismissed. Submission that motion judge erred in failing to find that receiver had already consented to action being commenced against it was rejected. No basis was seen to interfere with motion judge’s refusal to grant leave to sue receiver. This was discretionary decision. Motion judge found that there was no evidence tendered that plaintiff suffered damages and, having assessed record before her, she declined to draw such inference. No error was seen in her conclusion. It was reasonably based on evidence or lack of evidence placed before her on motion.
2027707 Ontario Ltd. v. Richard Burnside & Associates Ltd. (2016), 2016 CarswellOnt 17141, 2016 ONCA 819, Paul Rouleau J.A., K. van Rensburg J.A., and B.W. Miller J.A. (Ont. C.A.).

Conflict of Laws


Choice of law

The court held that Ontario did not have jurisdiction simpliciter

Motion judge stayed plaintiffs’ action against defendant on basis that it had no real and substantial connection to Ontario. Plaintiffs appealed. Appeal dismissed. None of presumptive factors set out in certain case law was satisfied on facts of case. Motion judge found that defendant was Alberta corporation, resident or domiciled in Alberta, and that accident giving rise to action occurred when plaintiff GC was staying at hotel while he worked temporarily in Alberta. These findings were open to motion judge on record before him, and they were fatal to claim that Ontario had jurisdiction simpliciter. There was no basis to pierce corporate veil, or to create new presumptive factor, simply because there was evidence that one of directors of corporation appeared to have resided in Ontario for period of time. Necessity argument was made because limitation period for bringing action in Alberta had expired, and plaintiffs would be unable to bring their action if they were not permitted to do so in Ontario. Forum of necessity doctrine was exception to real and substantial connection test, and operated only in extraordinary and exceptional circumstances. This was not appropriate case for exercise of court’s discretion. Plaintiffs made tactical decision not to bring their action in Alberta, and it would not be appropriate to relieve them of consequences of that decision. Effect was not given to plaintiffs’ argument that they were prejudiced by failure of defendant to provide them with information necessary for their defence of motion.
Cook v. 1293037 Alberta Ltd. (2016), 2016 CarswellOnt 17394, 2016 ONCA 836, R.A. Blair J.A., Gloria Epstein J.A., and Grant Huscroft J.A. (Ont. C.A.); affirmed (2015), 2015 CarswellOnt 19523, 2015 ONSC 7989, Mulligan J. (Ont. S.C.J.).


Income tax

Administration and enforcement

Court held that taxpayers had been grossly negligent

Taxpayers were husband and wife, respectively retired draftsperson and employed administrative assistant, who went to R for tax preparation. Taxpayers met R, who was not affiliated with any established tax preparers, in coffee shop rather than professional office and he only charged $45 per return. R convinced taxpayers to make charitable donations through program with inflated gift receipts and to participate in investment program, in two taxation years. CRA challenged results of such participation. Taxpayers filed income tax returns for year in question, claiming business income, expenses, and losses and requesting loss carryback. Minister reassessed taxpayers under Income Tax Act, disallowing claimed business losses and applying gross negligence penalties. Taxpayers’ appeal with respect to imposition of penalties was dismissed. Tax Court judge concluded that taxpayers were not so lacking in education or experience as to claim ignorance and that warning signs about R’s professional status and his questionable prior dealing of schemes attracting CRA attention should have motivated them to inquire further. Taxpayers appealed. Appeal dismissed. Taxpayers did not demonstrate any error in Tax Court judge’s analysis of governing legal principles and appreciation of evidence. There was ample evidentiary foundation to support Tax Court judge’s conclusion of gross negligence. Tax Court judge concluded that taxpayers made no effort to verify accuracy and completeness of their returns, simply signing their returns without even examining them in circumstances where they should have been on notice that something was amiss. Tax Court judge concluded that, had taxpayers made most minimal effort, they would have easily noticed utterly false information contained in their returns. Conclusion that taxpayers had been grossly negligent could not be disturbed.
Maynard v. R. (2016), 2016 CarswellNat 5331, 2016 FCA 251, Donald J. Rennie J.A., Nadon J.A., and Stratas J.A. (F.C.A.); affirmed (2016), 2016 CarswellNat 214, 2016 TCC 21, Rommel G. Masse D.J. (T.C.C.).

Labour and Employment Law

Labour law

Discipline and termination

Employer’s application for judicial review was dismissed

Employer dismissed worker for committing violent act in workplace. Worker’s grievance for wrongful dismissal was granted and dismissal was annulled. Worker’s misconduct merited severe penalty but employer failed to account for worker’s medical state and as such, employer’s behaviour constituted discriminatory act. Employer brought application for judicial review. Application dismissed. Commissioner did not break rules of procedural fairness. Commissioner did not err in concluding there was provocation. Even if commissioner could not take into account “some provocation”, decision was based on other mitigating factors supported by evidence on record. Given discrimination, commissioner did not err in concluding that ground of discrimination needed not be only factor in dismissal; that grounds of discrimination simply needed to be one factor. Evidence showed that employer was well aware of worker’s health condition. Decision of commissioner did not establish that employer could not terminate employee who committed violent acts; rather decision of commissioner showed that termination of employee could not be taken without consideration of offending employee’s health status.
Canada (Procureur général) c. Rahmani (2016), 2016 CarswellNat 5330, 2016 CAF 249, Gauthier J.A., Boivin J.A., and Yves de Montigny J.A. (F.C.A.); application for judicial review refused (2016), 2016 CarswellNat 460, 2016 CarswellNat 461, 2016 PSLREB 10, 2016 CRTEFP 10, Marie-Claire Perrault Member (Can. P.S.L.R.E.B.).

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