Date: 20060824
Docket: T-611-04
Citation: 2006 FC 1008
Ottawa, Ontario, August 24, 2006
Present:
The Honourable Mr. Justice Simon Noël
BETWEEN:
MICHEL VENNAT
Applicant
and
ATTORNEY
GENERAL OF CANADA
Respondent
TABLE OF
CONTENTS
|
I. Introduction ......................................................................................................... 6
II. The
suspension without pay order....................................................................... 7
III. Issues................................................................................................................... 8
IV. Answer
to the questions at issue........................................................................ 9
V. Facts
and procedural background....................................................................... 9
A. Mr. Beaudoin’s departure and Mr. Vennat’s arrival.................................... 9
B. The exchange of correspondence between the Minister of
Industry and the Chairperson of the Board of Directors of the BDC................................... 11
C. The
requests for meetings and the suspension without pay....................... 12
D. The
meeting and the production of documents.......................................... 17
E. The
applicant’s additional requests............................................................ 19
F.
The decision and the application for judicial review................................... 21
VI. Analysis
– Motions to strike and to remove certain evidence....................... 23
A. Respondent’s motion to strike and to remove certain
evidence................ 23
(1) First part.................................................................................................. 24
(2) Second
part............................................................................................. 24
(i)
Ground A........................................................................................... 25
(ii)
Ground B........................................................................................... 28
(iii)
Ground C........................................................................................... 28
(iv)
Ground D........................................................................................... 29
B. Applicant’s motion to strike.......................................................................... 29
(1) First
part................................................................................................. 32
(2) Second
and third part............................................................................. 33
VII.
Analysis – Principal application– Procedural issues......................................... 33
A.
Analysis in accordance with the factors in Baker........................................ 38
(1) The nature of the decision being made and process followed in
making it................................................................................................... 38
(a)
A non-judicial and non-formalistic procedure.............................. 38
(b)
The Governor in Council, master of the procedure........................ 39
(2) The nature of the statutory scheme and the terms of the law.............. 40
(a) The wording of subsection 6(2) of the BDC Act and
the “for cause”
requirement drawn from the case law............................................... 40
(b) The notion of holding office during good
behaviour: a variable
concept which does not afford a basis for inferring
that specific
procedural safeguards apply thereto................................................. 45
(c) The status and the purpose of the BDC: Enhanced
procedural
......... safeguards.......................................................................................... 49
(d) The absence of a right to appeal confirms that
enhanced
procedural safeguards must be recognized....................................... 53
(3) The
importance of the decision to the individual affected................... 54
(4) The legitimate expectations................................................................... 55
(5) The procedural choices of the
decision-making body........................... 58
(a) A non-judicial and non-formalistic procedure............................ 58
(b) The Governor in Council’s obligation to
conduct a personalized
inquiry and the right to respond.................................................... 60
(i) The use of the judgment in Beaudoin v. Banque
de développement du Canada............................................................ 61
i.1) The judgment creates a simple presumption of facts............ 62
i.2) The applicant does not have the right to
examine and
cross-examine witnesses........................................................ 65
(ii) The case law.................................................................................. 66
ii.1) Wedge v. Canada (Attorney General)................................... 67
ii.2) Weatherill v. Canada
(Attorney General)............................ 68
(iii) Findings regarding the obligation
to conduct a personalized inquiry and the right to respond.................................................. 71
(iv) Meaning of the expression “personalized inquiry”
[“enquête personalisée”]................................................................ 76
(c) The nature of the duties performed: the
Governor in Council
can be somewhat predisposed in factual
situations in the context
of an employer-employee relationship............................................ 78
(d)
The right to fair play and transparency........................................ 80
B. Analysis of the procedural safeguards according to Knight................ 83
(1) The right to be informed of the reasons for the employer’s
dissatisfaction ........................................................................................ 84
(2) The
applicant’s right to respond was only observed in part............... 85
(a) The duration of the meeting and failure to
conduct a personalized inquiry................................................................ 86
(b) The timeframe for the decision-making process was very brief. 87
(c) The absence of Mr. Ritchie.......................................................... 89
(d) The standard applied.................................................................... 90
C.
Finding on the Governor in Council’s duty to act fairly......................... 93
VIII. Analysis
– Principal application– Substantive issues..................................... 95
IX. The
costs.......................................................................................................... 95
X. Conclusion........................................................................................................ 96
Appendix A 99
Appendix B............................................................................................................... 100
Appendix C............................................................................................................... 101
|
REASONS FOR JUDGMENT AND
JUDGMENT
I. Introduction
[1]
This is an
application for judicial review based on section 18.1 of the Federal Courts
Act, R.S., 1985, c. F-7 (FCA) against two Orders of the Governor
in Council regarding the applicant Michel Vennat (applicant or Mr.
Vennat).
[2]
The two
Orders in Council (the Orders in Council) at issue are the following:
- An
Order in Council dated February 24, 2004, bearing number P.C. 2004-147 (suspension
without pay order), suspending the applicant without pay from his duties as
President and Chief Executive Officer of the Business Development Bank of
Canada (BDC) until further notice (MV-10);
- An
Order in Council dated March 12, 2004, bearing number P.C. 2004-225 (dismissal
order), made pursuant to subsection 6(2) of the Business Development Bank of
Canada Act , 1995, c. 28 (BDC Act), terminating the appointment of Mr. Vennat
as President and Chief Executive Officer of the BDC (Exhibit MV-21).
[3]
Mr. Vennat
is asking the Court to make certiorari orders quashing or setting aside
the Orders in Council, as well as an order confirming the full force and effect
of the Order in Council for the applicant’s appointment, dated July 31, 2000,
bearing number P.C. 2000-1278 (Appointment Order) (Exhibit MV-2).
II. The suspension without pay
order
[4]
Although
this application for judicial review appears to contemplate two distinct
decisions, it would, in my opinion, be appropriate to deal with them as a
single decision. That is what Hugessen J. stated in his order dated
January 20, 2006:
[TRANSLATION]
[3] Mr.
Vennat alleged that the orders constituted a single decision . . .
[4] In
my opinion, the Court should authorize Mr. Vennat to contest the two orders in
a single application for judicial review. In my view, it is obvious that the
orders constitute one continuous decision. These two orders were published by
only one decision-making organization, that is, the Governor General in
Council. The Suspension Order and the Dismissal Order concern the same facts,
and Mr. Vennat is seeking the same relief. It is obvious that the two orders
concern one situation, that is, the role played by Mr. Vennat in the dismissal
of François Beaudoin. In addition, it would be a waste of time and resources to
require two distinct applications for judicial review in this case. In short,
the Court shall order that this application for judicial review concern both
orders of the Governor General in Council. . . .
[References omitted.]
I share the opinion of Hugessen J. The two Orders in Council
are inextricably linked and they need not be addressed separately, as the
applicant acknowledged before Hugessen J.
[5]
This
application for judicial review will require a detailed analysis of the issue
of whether the duty to act fairly was observed in the applicant’s case. A
preliminary decision does not generally give rise to the application of a duty
to act fairly (Knight v. Indian Head School Div. No. 19,
[1990] 1 S.C.R. 653, at page 670). The suspension without pay order is a
preliminary decision, and the dismissal order is the final decision. Bearing
that in mind, the suspension without pay order is still a relevant factor in
the factual framework in determining whether the applicant was treated in compliance
with the duty to act fairly.
III. Issues
[6]
The issues
are the following:
1. What is
the nature of the duty to act fairly applicable when dismissing a person
appointed to hold office during good behaviour as President and Chief Executive
Officer of the BDC?
2. Was the duty to act
fairly observed in the applicant’s case?
3. In the
affirmative,
(a) What is
the appropriate standard of review for the decisions of the Governor in Council
in this case?
(b) Should the
Orders in Council be upheld considering this standard of review?
IV. Answer to the questions at
issue
[7]
For the
reasons that follow, it is my opinion that the applicable procedural safeguards
were not respected as regards the applicant. The application for judicial
review is allowed, and questions 3(a) and 3(b) need not be answered considering
my answer to questions 1 and 2.
V. Facts and procedural
background
A. Mr. Beaudoin’s
departure and Mr. Vennat’s arrival
[8]
François
Beaudoin (Mr. Beaudoin) had been President and Chief Executive Officer of
the BDC from January 27, 1993 to October 1, 1999.
[9]
On June 4,
1998, the applicant was appointed as Chairperson of the BDC’s Board of
Directors during pleasure for a three-year mandate, as appears from the Order
of the Governor in Council bearing number P.C. 1998-985 (Exhibit MV-1).
[10]
During
1999, disputes within the BDC would lead to Mr. Beaudoin’s departure. On
September 15, 1999, a transaction providing for the payment of Mr. Beaudoin’s
pension was made between Mr. Beaudoin and the BDC (the transaction). This
transaction was approved by the Governor in Council on September 17, 1999. Mr. Beaudoin
continued his duties until October 1, 1999.
[11]
On July
31, 2000, the applicant was appointed President and Chief Executive Officer of
the BDC for a five-year mandate beginning on August 15, 2000, as appears in the
Appointment Order. At that time he replaced Bernie Schroder, the person that
had been appointed to act following Mr. Beaudoin’s departure.
[12]
On
November 3, 2000, following difficulties relating to the performance of the
transaction, Mr. Beaudoin filed a motion to homologate the transaction
(Exhibit MV-17, sub-tab 3) in the Superior Court of Quebec. On December 8,
2000, the BDC asked that the transaction be annulled and that the motion be
dismissed. Moreover, it drafted a counterclaim against Mr. Beaudoin
(Exhibit MV-17, sub-tab 5).
[13]
On
February 6, 2004, Mr. Justice André Denis of the Superior Court of Quebec made
a decision in the matter of Beaudoin v. Banque de développement du Canada,
[2004] J.Q. No. 705, homologating the transaction and ordering the BDC to
comply with it. The judgment also offset some of the sums due from Mr. Beaudoin
to the BDC. The judgment contains harsh remarks about the BDC and the
applicant, who was a witness at the hearing. That decision is final, as the
parties chose not to appeal it.
B. The
exchange of correspondence between the Minister of Industry and the Chairperson
of the Board of Directors of the BDC
[14]
In a
letter dated February 9, 2004, the Minister of Industry, Lucienne Robillard
(the Minister of Industry) wrote the following to Cedric E. Ritchie (Mr.
Ritchie), then Chairperson of the BDC’s Board of Directors (Exhibit MV-6):
Dear Mr.
Ritchie,
Last
Friday, Justice Denis of the Quebec Superior Court rendered his decision in the
case of François Beaudoin vs Development Bank of Canada.
Like
many Canadians, I am concerned by the conclusions expressed and the fact
findings by Justice Denis in his decision.
As
Minister responsible for the BDC before Parliament, and to allow me to report
to Canadians, I would like to be informed of what the BDC intends to do
following the Court’s decision and, more particularly, if the BDC will appeal
the decision. I would also like to be informed of any other decisions and
actions the BDC intends to take as a result of the Court’s decision.
[15]
Mr.
Ritchie responded to the Minister of Industry in a letter dated February
18, 2004, (Exhibit MV-7), which reads as follows:
Dear
Minister,
On February
9th, you wrote me concerning the decision in the case of François Beaudoin vs
Development Bank of Canada.
After careful
discussion, the Board has decided not to appeal the decision for the reasons
mentioned in the attached draft press release. The Board has also confirmed its
full confidence in the management of the Bank, and specifically its President
and Chief Executive Officer, Mr. Michel Vennat.
The Board is
of the opinion that no further action is required as a result of the court’s
decision.
[16]
The press
release attached to the letter reads as follows (press release dated
February 18, 2004) (Exhibit MV-8):
BDC Board of Directors decides not to appeal court decision - Board fully
supports
BDC management
Montréal, February 18,
2004 –
At a meeting held earlier today, the Business Development Bank of Canada’s
(BDC) Board of Directors (Board) has decided not to appeal the February 6th
Superior Court of Québec’s decision in the matter involving BDC and its former
President, Mr. François Beaudoin.
In coming to this decision, the Board considered two separate legal opinions:
(i) the advice of the Honourable Claude Bisson, retired Chief Justice of the
Court of Appeal of Québec, in his capacity as independent counsel to the Board,
and (ii) the advice of Raynold Langlois in his capacity as outside counsel to
BDC.
Although the legal advice received from both counsels was to the effect that
the decision is flawed in many respects and that an appeal was recommended, the
Board decided not to pursue the matter.
The Board Chairman, Cedric E. Ritchie, said: “The Board in conjunction with
Bank management has decided to close this chapter in the best interest of our
employees and our clients, and get on with what BDC does best – serve the needs
of Canadian entrepreneurs.”
The Board’s decision is the result of a profound and thoughtful analysis. The
Board believes that all legal actions undertaken by BDC in this case were
solely governed by sound principles of governance and the protection of its
assets.
At its meeting this morning, the Board unanimously reiterated its full
confidence in the management of the Bank, and specifically its President and
Chief Executive Officer, Michel Vennat. It noted that since his appointment as
head of the Bank in August 2000, Mr. Vennat implemented a number of initiatives
to strengthen BDC governance and ethics. The Board also observed that the
performance of BDC has been outstanding in all respects since Mr. Vennat
took office, making it even more relevant to the aspirations and development of
businesses in Canada.
Mr. Ritchie added: “The Board understands that this has been a trying time for
BDC’s employees and clients. Furthermore, the Board fully supports the
Management of BDC”.
The Business Development Bank of Canada is a financial institution wholly owned
by the Government of Canada. BDC plays a leadership role in delivering
financial, investment and consulting services to Canadian small businesses,
with a particular focus on the technology and export sectors of the economy.
C. The requests for
meetings and the suspension without pay
[17]
Mr. Vennat
then sent to the Prime Minister of Canada, Mr. Paul Martin, a letter dated
February 23, 2004 (letter to the Prime Minister), asking the government to observe
the procedural fairness owed to him (Exhibit MV-9):
Dear Prime
Minister,
I am very
concerned in reading newspaper reports to the effect that your government is
preparing to make decisions about my future without giving me the opportunity
to be heard. I am not even aware of what allegations have been made about me.
If these
stories are true, I am hereby requesting the opportunity to be heard fairly,
with due process, in the presence of our Chairman and counsel, at a meeting
where the Clerk of the Privy Council and the Deputy Minister of Justice would
participate, before any decision and any announcement is made.
[18]
On
February 24, 2004, the Minister of Industry sent the applicant a letter reading
as follows (letter dated February 24, 2004) (Exhibit MV-10):
[TRANSLATION]
Sir,
The government
has carefully reviewed the decision by Mr. Justice Denis of the Superior Court
in the matter of Beaudoin v. Banque de développement du Canada, made on
February 6 of this year.
Following
that review and taking into account the comments and findings made by
Mr. Justice Denis with regard to your conduct and the role that you
played in this matter, serious questions were raised regarding whether there
are valid grounds justifying the termination of your appointment as President
and Chief Executive Officer of the BDC.
In view of
the foregoing, I hereby inform you that earlier today an Order was adopted by
the Governor in Council having the immediate effect of suspending you without
pay from your duties as President and Chief Executive Officer of the
BDC. Please find attached a copy of the Order in Council in question.
I also inform
you that you have until next Monday, March 1 at 4:00 p.m. to produce written
reasons explaining why, in your opinion, the Governor in Council should not
terminate for cause your duties as President and Chief Executive Officer of the
BDC. I would appreciate it if you would send your written submissions to
my office.
Sincerely
yours . . .
[19]
The suspension
without pay order is attached to the letter.
[20]
On
February 25, 2004, the applicant wrote to the Minister of Industry (letter
dated February 25, 2004) asking for the grounds for the allegations
and requesting a meeting before counsel, the Clerk of the Privy Council Office
and the Deputy Minister of Justice. The letter included as an attachment a press
release entitled [TRANSLATION] “Michel Vennat: unjust
decision” (Exhibit MV-11).
[21]
In a
letter dated February 26, 2004, the Minister of Industry responded to the
applicant (letter dated February 26, 2004) (Exhibit MV-12). The letter reads as
follows:
[TRANSLATION]
Sir,
I
acknowledge receipt of your letter dated February 25, 2004, in reply to my
letter dated February 24, 2004, informing you inter alia of the decision
by the Governor General in Council to suspend you, without pay, from your
duties as President of the Business Development Bank of Canada, until
further notice.
I
understand in part from your letter that you would like to know more
specifically what allegations have been made against you.
I
would first like to refer to my letter dated February 24, in which I pointed
out that the comments and findings made by Mr. Justice Denis raise serious
questions regarding your conduct and the role that you played in that matter.
That said, and in response to your letter of yesterday, I am providing you with
the following additional information to assist you in preparing your written reasons.
First,
and foremost, I draw your attention to paragraphs 597, 651 and 653 of
the decision, which read as follows:
[597] In fact, the entire
operation reinforces the impartial observer’s impression that a vendetta was
orchestrated by the BDC against Mr. Beaudoin. . . .
[651] The vicious if not
malicious manner in which he was treated in this whole matter certainly reinforced
his beliefs.
[653] They acted as
though they wanted to break him and ruin his career. This entire affair leaves
a profound sense of injustice . . .
As
well as commenting on the paragraphs that I just cited, please also comment on
the following paragraphs of the decision by Mr. Justice Denis: 490,
499, 555, 576, 580, 608, 609, 613, 614, 640 and 1614.
I
would add that the list of the above-mentioned paragraphs is not an exhaustive
list of all the paragraphs concerning you or relating to the BDC, its employees
and agents and, in essence, you must provide a global response to this judicial
decision as a whole and not just to the cited paragraphs.
In
elaborating your written reasons, it will be important that you comment not
only on your personal role, but also on aspects of the conduct and behaviour of
the Bank and its agents, for whom you may legitimately be held responsible.
Furthermore, please ensure that your reasons are supported by objective and
relevant facts and data.
You
have also asked me to meet with you in the presence of your legal counsel, the
Clerk of the Privy Council and the Deputy Minister of Justice. I agree to meet
with you and I may be accompanied by representatives of the Privy Council and
the Justice Minister.
Note
that this meeting does not in any way substitute the request that I made to you
to submit to me in writing, before March 1, 2004, at 4:00 p.m., the reasons for
which, in your opinion, the Governor General in Council should not terminate
your duties. The explanations that you provide verbally during our meeting
should be included in your written reasons.
The
recommendation that I will make to the Governor General in Council will be
based on the decision by Mr. Justice Denis, on the explanations provided during
our meeting and on your written reasons. The Governor General in Council will
consider it all when she decides whether or not you will continue in your
position.
My
office will contact you in the hours that follow to determine the place, date
and time of the meeting.
Sincerely
yours . . .
[Emphasis
added.]
In short, the letter dated February 26, 2004, informed the
applicant that there were two components of the allegations against him,
namely:
-
His
conduct and his credibility at the hearing in Beaudoin v. Banque de
développement du Canada, above (personal component);
- His actions,
in performing his duties as President and Chief Executive Office in particular [TRANSLATION] “in relation to the
issues contemplated in the reasons of the decision in the matter of Beaudoin” [the
letter specifies a series of paragraphs from the judgment] and with respect to “the
aspects of the conduct and behaviour of the bank and its agents for whom [Mr.
Vennat] may legitimately be held responsible” (corporate component).
[22]
On
February 29, 2004, the applicant’s counsel wrote to the Minister of Industry, referring
to the unreasonableness of the time period given to respond to the grounds for
the allegations and pointing out that only [TRANSLATION]
“a first draft” of the
applicant’s response could be submitted in that time (Exhibit MV-13). The
letter reads as follows:
[TRANSLATION]
Madam Minister,
Your
letter dated February 26, 2004, addressed to our client, Michel Vennat, O.C., Q.C.,
was referred to us for review and response.
First,
we must thank you for having accepted, in principle, the meeting requested.
On
another note, we have reviewed the additional information that you provided to Mr. Vennat
regarding the paragraphs of Mr. Justice Denis’ decision that you wanted Mr.
Vennat to comment on specifically. We are working on it and we believe that at
Monday’s meeting we shall be able to provide you with a first draft of the
written reasons as to why Mr. Vennat considers that the Governor in
Council should not terminate his duties as President and Chief Executive
Officer of the BDC on the basis of Mr. Justice Denis’ decision.
You
understand, however, that the amount of time that was given to Mr. Vennat to
do so is such that it is unreasonable to expect that we can do a thorough job
in that time – for us it will involve a careful review of not only the judgment
of 1745 paragraphs over 210 pages, but of the facts and the evidence on which
it is based (32 days of hearing/35 witnesses, more than 300 exhibits,
approximately 8000 pages of transcript).
That
is why, when you ask us to “provide a global response to this judicial
decision as a whole and not just to the cited paragraphs” and “reasons .
. . supported by objective and relevant facts and data”, that at the end
of our meeting on Monday we may subsequently give you additional written
information if it is necessary to review all of the evidence (since we were not
the solicitors of record at trial).
Sincerely
yours . . .
[Emphasis in
original.]
D. The meeting and the
production of documents
[23]
On March
1, 2004, a meeting was held in Ottawa (meeting of March 1, 2004).
The applicant, accompanied by his counsel, the Minister of Industry, the Clerk
of the Privy Council as well as Pierre Legault, general in-house counsel at the
Department of Industry, were present. The substance of that meeting was
established only by the applicant’s affidavit, as the respondent chose not to
file an affidavit.
[24]
At the
meeting, the applicant in essence says that he explained the substance of a
six-page letter, dated March 1, 2004, addressed to the Minister of Industry
(letter dated March 1, 2004) (Exhibit MV-14). This letter gives the applicant’s
version of the facts regarding various aspects of the matter of Beaudoin v.
Banque de développement du Canada, above. Moreover, his counsel
reviewed some parts of the preliminary memorandum that they had prepared to be
sent to the Minister of Industry (preliminary memorandum) (Exhibit MV-15) at
the same time as the letter.
[25]
The Clerk
of the Privy Council asked Mr. Vennat and his counsel whether it would be
possible to obtain a copy of the legal opinions. It was then stated that the
BDC had advised the applicant that it would not waive solicitor-client
privilege and that, for that reason, the applicant could not disclose a copy of
the legal opinions to the Minister of Industry. The Minister of Industry had
also asked, near the end of the meeting, whether she could have a copy of
certain documents, including the minutes of the proceedings of the Board of
Directors with regard to Beaudoin v. Banque de développement du Canada, above,
to which the applicant agreed. The applicant and his counsel asked the Minister
of Industry if she wanted to have a copy of the exhibits and the transcripts of
hearing of Beaudoin v. Banque de développement du Canada, above. The applicant invited the Minister of
Industry to obtain statements from certain third parties in order to establish
that the judgment was unfounded. The Minister of Industry responded that it was
not necessary. The applicant indicated that he was ready to provide additional
information or to respond to any other questions.
[26]
On March
2, 2004, the applicant’s counsel prepared the documentation requested by the
Minister of Industry and sent it to her (Exhibits MV-16 and MV-17). Counsel
agree that the meeting lasted no more than two hours.
E. The applicant’s additional
requests
[27]
On March
3, 2004, the remarks of [TRANSLATION]
“a source close to Paul Martin” were reported in Vincent Marissal’s political
column (article from the newspaper La Presse) (Exhibit MV-18):
[TRANSLATION]
I really
cannot see how those two [the applicant and Marc Lefrançois, President of Via
Rail] can get out of it, knowing the allegations against them, there is nothing
they can say that would convince the Prime Minister to leave them in their
positions.
[28]
The
applicant’s counsel then sent a letter, dated March 4, 2004 (letter dated March
4, 2004), to the Minister of Industry (Exhibit MV-19). That letter refers to
the article from the newspaper La Presse, expresses the applicant’s
concerns and seeks the Minister of Industry’s reassurance:
[TRANSLATION]
Madam
Minister,
Further to
our meeting of Monday, March 1, 2004, and our letter dated Tuesday, March 2, 2004,
sending you the additional documents, we wish to call your attention to a
highly disturbing situation.
In an article
that appeared in La Presse on Wednesday, March 3, 2004, entitled “The
Apprentice” sauce Paul Martin …, journalist Vincent Marissal reports the
following remarks of a source close to Paul Martin:
I really cannot see how
those two (*) can get out of it, knowing the allegations against them, there is
nothing they can say that would convince the Prime Minister to leave them in
their positions.
(*) referring to Michel
Vennat and Marc Lefrançois
This source
seems to indicate that the decision has been, for all practical purposes,
already made. This hardly reflects the duty to act in observing the rules of
natural justice and procedural fairness (regarding which we have made specific
submissions to you).
Michel Vennat
made a great deal of effort to meet the deadline that was imposed on him. We
believe that you had an open mind at our meeting and that you were listening to
Michel Vennat’s position. We hope that this exercise was not in vain for him or
for you, in light of the foregoing.
You would
agree that to be judged and condemned like this, in public, without any other form
of hearing (Vincent Marissal talks about the Prime Minister giving Michel
Vennat and Marc Lefrançois [TRANSLATION]
“a professional death sentence” to have an effect on the polls) is
appalling to the fair and equitable. Especially when Michel Vennat, out of
respect to you and his position as President and Chief Executive Officer of the
BDC, has to date refused to debate the matter publicly, thereby respecting the
review process that you have begun.
Michel Vennat
must be assured that the rules of natural justice and procedural fairness are
truly observed.
Sincerely
yours . . .
[Emphasis in
original.]
[29]
On March
10, 2004, in a letter sent to the Minister of Industry, copied to the Minister
of Justice, Irwin Cotler (letter dated March 10, 2004), the applicant’s counsel
proposed that the Minister of Justice refer the matter to the Judicial Council
for an inquiry to be held regarding the applicant’s possible removal, in
accordance with section 69 of the Judges Act, R.S., 1985,
c. J-1 (Exhibit MV-20). The letter reads as follows:
[TRANSLATION]
RE: Michel Vennat, O.C., Q.C.
Madam Minister,
Further
to our meeting of Monday, March 1, 2004, and our letters of Tuesday,
March 2, 2004, sending you the additional documents, and of Thursday,
March 4, 2004, sharing our concerns with you regarding the observance of the
rules of natural justice and procedural fairness, we would like to bring to
your attention an additional matter for reflection.
Although
we are confident that you will make a recommendation observing Michel Vennat’s
rights as set out in his letter and our memorandum of March 1, 2004, if there
should be a degree of discomfort following your analysis, or if you are
confronted with contrary views, there is then the following alternative.
The
source of the problem is the judgment in Beaudoin. Michel Vennat wholeheartedly
disagrees with the judge’s position toward him, which he considers to be
totally unfounded and unenforceable. We believe that we established this for you
based on the evidence and the principles that apply in such cases. This should
be enough to reinstate Michel Vennat to his duties immediately.
If,
notwithstanding the foregoing, the government still had doubts, we should
remember that our justice system is designed in such a way that the recognized manner
to challenge an unfounded judgment is to appeal it before the Court of Appeal.
However,
since Michel Vennat was not personally a party to the proceedings between Mr. Beaudoin
and the BDC, he did not have the right to appeal the judgment in order to
challenge its merits even if it targeted him personally. Only the BDC could go
to appeal, on its own or on ministerial order. The BDC decided not to do so for
business reasons. The government, which had the power to instruct the BDC to go
to appeal, did not do so. As the time period for the appeal has expired, we
note that this is no longer a viable solution.
However,
the BDC clearly expressed its disagreement with the judgment, and its Board of
Directors, which by law directs and manages the business and affairs of the BDC,
unanimously reiterated its support for its President and Chief Executive Officer,
Michel Vennat.
Michel
Vennat must therefore be given the opportunity to defend himself before an
impartial and independent tribunal whose decision is not dependant on political
pressure, influenced by the polls, and/or by media hype, but rather is respectful
of the rights of the parties including the rights of Michel Vennat. This forum
exists. It is a matter of referring the case to the Canadian Judicial Council (“Council”)
in accordance with the Judges Act (R.S.C 1985, c. J-1). A specific
provision of that Act, section 69, authorizes the Minister of Justice to
address the Council to conduct an inquiry on the reasons for the removal raised
in respect of a person appointed to hold office during good behaviour under a
federal law. That is Michel Vennat’s case.
It
is clear that in any event, Michel Vennat must be reinstated immediately to resume
his duties since, even if the matter is referred to the Council, this must be parallel
to a reinstatement in order to, first, respect the referral to the Council and,
second, to not prejudge its recommendation. That would establish that the
government is respecting individual human rights.
Sincerely
yours . . .
F. The decision and the
application for judicial review
[30]
A
certificate from the Clerk of the Privy Council (an appendix is attached
thereto) dated April 20, 2005, had been submitted to the Court pursuant to
section 39 of the Canada Evidence Act, R.S. 1985, c. C-5
(Exhibit MV-32). The certificate indicates that two documents cannot be
disclosed because they contain confidential information of the Privy Council.
The appendix states that document #1 involves the suspension without pay order.
The appendix states moreover that document #2 is a submission proposing the
Minister of Industry’s recommendation to the Governor in Council in March 2004
(the date and the title are not specified), regarding the end of
Mr. Vennat’s mandate. The certificate and the appendix do not reveal
anything else regarding the substance of document #2.
[31]
On March
12, 2004, the Minister of Industry wrote the applicant to inform him of the
adoption of the dismissal order (dismissal letter) (Exhibit MV-21):
[TRANSLATION]
Sir,
The
government has carefully reviewed the decision made by Mr. Justice Denis of the
Superior Court of Quebec in François Beaudoin v. Banque de développement du
Canada (BDC), on February 6 of this year. The government has also reviewed
the written submissions and the documents that you provided to me on March 1
and 2, 2004. It has also considered your oral submissions of
March 1, 2004.
The
Governor in Council determined that she lost confidence in you as President of
the Business Development Bank of Canada and that your conduct in relation to the
issues contemplated in the reasons of the decision in the matter of Beaudoin is
incompatible with your continued appointment.
In
light of the foregoing, I hereby inform you that an Order was adopted by the
Governor in Council earlier today, having the immediate effect of terminating
your duties as President and Chief Executive Officer of the BDC. Please
find attached a copy of the Order in Council in question.
Sincerely
yours . . .
[32]
The
dismissal order, attached to the letter, reads as follows:
Whereas,
by Order in Council P.C. 2000-1278 of July 31, 2000, Michel Vennat was
appointed President of the Business Development Bank of Canada, to hold office
during good behaviour for a term of five years, effective August 15, 2000;
Whereas
on February 6, 2004, the Honourable Justice André Denis of the Superior Court
of Québec issued his reasons for judgment in François Beaudoin v. Banque de
développement du Canada, in which he commented adversely on the conduct of
Michel Vennat;
Whereas,
by Order in Council P.C. 2004-147 of February 24, 2004, Michel Vennat was
suspended, without pay, from his duties as President of the Business
Development Bank of Canada until further notice;
Whereas
on February 24, 2004, Michel Vennat was informed by the Government of Canada of
its concerns respecting his conduct as described in the reasons for judgment in
François Beaudoin v. Banque de développement du Canada, and was invited to make
submissions in response before March 1, 2004;
Whereas
on March 1, 2004 and March 2, 2004, Michel Vennat made submissions orally and
in writing;
And
whereas the Governor in Council, having considered the reasons for judgment in
François Beaudoin v. Banque de développement du Canada and the submissions
received from Michel Vennat in response,
(a)
has
lost confidence in Michel Vennat as President of the Business Development Bank
of Canada, and
(b)
is
of the opinion that the conduct of Michel Vennat in respect of the matters
addressed in the reasons for judgment in François Beaudoin v. Banque de
développement du Canada is incompatible with his continued appointment as President
of the Business Development Bank of Canada;
Therefore,
Her Excellency the Governor General in Council, on the recommendation of the
Minister of Industry, hereby terminates the appointment of Michel Vennat as
President of the Business Development Bank of Canada, made by Order in Council
P.C. 2000-1278 of July 31, 2000.
[33]
On March
25, 2004, the applicant filed this application for judicial review before the
Federal Court.
[34]
The
hearing of the application began in Montréal on June 27 and 28, 2006, in accordance
with the order of the court administrator dated June 9, 2006. Based on the
complexity of the issues in play and the length of the oral arguments, the
hearing continued on July 4 and 5, with the parties’ consent. The undersigned
heard the parties’ submissions on the motions to strike and to remove certain
evidence as well as on procedural and substantive issues.
VI. Analysis – Motions to strike
and to remove certain evidence
(1) Respondent’s
motion to strike and to remove certain evidence
[35]
On December
12, 2005, the respondent introduced a motion to obtain directions from the
Court regarding section 302 of the Federal Courts Rules, SOR/98-106 (Rules)
(first part) and to expunge certain evidence from the applicant’s record
(second part). The motion was amended on June 27, 2006, but its substance is
essentially the same as it was originally.
(a) First part
[36]
As stated
above, Hugessen J. determined in his order dated January 20, 2006, that the suspension
without pay order and the dismissal order were “ a single decision” to be
addressed in a single application for judicial review. Therefore, only the
second part of the motion remains to be addressed since Hugessen J. ordered
that the application for judicial review bears on both Orders in Council (paragraph
4 of the order and page 4 “Notwithstanding
section 302 of the Rules, the applicant is authorized to institute this
proceeding”).
[37]
In the
same order, Hugessen J. decided to leave the task of deciding the second part
of the respondent’s motion to the judge responsible for hearing the application
for judicial review.
(b) Second part
[38]
The
respondent is asking for the removal of the affidavit of Denis Désautels,
former Auditor General of Canada (applicant’s record, tab 3), Exhibits MV-22,
MV-30, MV-31 and MV-33, as well as the paragraphs of the applicant’s affidavit
that are based on that evidence. He submits that this evidence in the applicant’s
record, and the paragraphs relating thereto, amount to new evidence that was
not or could not have been before the Governor in Council when the decisions
contemplated by the application for judicial review were made (ground A).
[39]
The respondent
is also seeking to have struck certain paragraphs containing information that
was not or could not have been before the decision-maker when the decision was
made (ground B).
[40]
Further,
the respondent is seeking to have other paragraphs struck from the applicant’s
affidavit on the basis that they are allegations of law, opinion or commentary
regarding evidence that is self-explanatory (ground C).
[41]
Finally,
the respondent is seeking to have paragraphs 83 to 244 of the applicant’s
affidavit struck in their entirety, on the ground that they repeat the
applicant’s arguments before the Governor in Council (ground D).
[42]
I am
dealing separately with each of the grounds, and there are corresponding
appendices listing the paragraphs for which the motion to strike is granted
(see Appendices A, B and C). The portion of the motion to strike based on
ground D is not granted.
(i) Ground A
[43]
Generally,
at the judicial review stage, only evidence relied on in the decision under
review must be considered (see Smith v. Canada, 2001 FCA 86). Such is
the case because the purpose of the application for judicial review “is not to determine whether or not the decision of the
Tribunal in question was correct in absolute terms but rather to determine
whether the Tribunal was correct based on the record before it” (Chopra v. Canada
(Treasury Board), [1999] F.C.J. No. 835, at paragraph 5).
[44]
Exceptionally,
the Court may receive documents that did not exist at the time of the
application for judicial review, when issues of procedural fairness or
jurisdiction are involved (McFadyen v. Canada (Attorney General), 2005 FCA 360, at paragraphs
14 and 15; Ontario Association of Architects v. Association of Architectural
Technologists of Ontario, [2003] 1 F.C. 331, at paragraph 30
(F.C.A.)). Issues of that nature are involved in this case.
[45]
However,
to be admitted on an exceptional basis, the evidence that was not available to
the decision-maker must serve to establish that there was a breach of
procedural fairness, and not that the applicant was correct on the merits. If
this rule is not observed, the applicant could indirectly introduce new
evidence on the merits, thereby making the application for judicial review a
hearing de novo. In other words, it would be sufficient to raise
procedural fairness to transform an application for judicial review into a
hearing de novo.
[46]
In this
case, the affidavit of Denis Désautels as well as Exhibits MV-22 (DVD
containing the transcripts and exhibits of the hearing – I note that the
Governor in Council refused to review them), MV-30 (personal notes by certain
witnesses at the hearing), MV-31 (investigation report by the Syndic de l’Ordre
des comptables regarding the role of KPMG, dated January 28, 2005)
and MV-33 (order to appear and certification by the Clerk of the Privy Council
filed for the purposes of the proceeding initiated by the applicant against the
respondent in Superior Court) have no relevance to the issues of procedural
fairness. Those exhibits are intended to establish that the applicant should
prevail on the merits and were not in the respondent’s possession during the
suspension without pay process and the applicant’s removal. Further, Exhibit
MV-33 contains proceedings associated with a remedy taken in Superior Court of
Québec, and not with this proceeding. Those exhibits must therefore be expunged
from the record.
[47]
The
respondent wanted the paragraphs of the applicant’s affidavit relating to these
exhibits to be struck for the same reason, in the interest of justice. I agree with
the respondent on this point. Appendix A indicates which paragraphs must be
struck accordingly. However, I thought it better not to strike the
paragraphs referring to extracts from the decision in Beaudoin v. Banque de
développement du Canada, above, since that decision was submitted to
the Governor in Council when she adopted the Orders in Council.
(ii) Ground B
[48]
The respondent
considers that the Court should strike the paragraphs containing information
that was not or could not have been found before the decision-maker at the time
the decision was made.
[49]
For
reasons that are analogous with the reasons raised in my decision regarding
ground A, I do not believe that these paragraphs should appear in the applicant’s
affidavit. Accordingly, the respondent’s motion is granted in part on that
basis, and certain paragraphs of the applicant’s affidavit are ordered struck,
in accordance with Appendix B of this decision. Essentially, they are facts
that the Governor in Council could not have known when the Orders in Council
were adopted. Here again, the passages reproduced in the applicant’s affidavit
which are drawn from Beaudoin v. Banque de développement du Canada, above, are not struck.
(iii) Ground C
[50]
The
respondent also contends that certain paragraphs of the applicant’s affidavit
are allegations of law, opinion or commentary regarding evidence. I agree in
part with the respondent. Subsection 81(1) of the Rules is very clear: the
contents of affidavits must be confined to the facts. Further, it is
acknowledged that an affidavit cannot be used in Federal Court to present
additional arguments by one of the parties. Otherwise, the parties could use
affidavits to bypass subsection 70(4) of the Rules, which provides that a
memorandum of fact and law cannot in principle exceed 30 pages, unless
otherwise ordered by the Court. Accordingly, the elements that are opinion,
allegations of law, or commentary must be struck from the applicant’s affidavit
(see Appendix C).
(iv) Ground D
[51]
Furthermore,
the respondent is asking that paragraphs 83 to 244 be struck out entirely, on
the ground that they repeat the applicant’s arguments before the Governor in
Council or rather because they comment on documents that are self-explanatory.
Except for the paragraphs already struck for the reasons given above (in
relation to the expunged Exhibits MV-22, MV-30, MV-31 and MV-33 or constituting
allegations of law, opinion or commentary), I do not believe that
paragraphs 83 to 244 must be struck in their entirety since they do not
necessarily repeat that which was submitted to the Governor in Council. Indeed,
they provide an explanation of the substance of the submissions in order to
enlighten the Court for the purposes of the judicial review. These paragraphs
are of some use in understanding this matter, which is very complex and
voluminous. The striking out of all of paragraphs 83 to 244 of the applicant’s
affidavit is therefore not granted.
(2) Applicant’s
motion to strike
[52]
On June
21, 2006, the applicant filed a motion based on section 221, seeking to strike
out certain paragraphs of the respondent’s reply record. The motion has three
parts:
-
The
applicant considers that the judgment in Beaudoin v. Banque de développement
du Canada, above, cannot be enforced against him before
the Federal Court and that the respondent cannot use the facts stated therein
in his submissions (first part);
-
The
applicant considers that certain paragraphs of the respondent’s memorandum
relied on facts not supported by the evidence or that directly contradicted the
evidence (second part);
-
Other
paragraphs of the respondent’s memorandum are based, in the applicant’s view,
on incorrect references (third part).
[53]
Alternatively,
the applicant is asking that the Court not assign any weight to the paragraphs
based on facts drawn from the judgment, facts not introduced into evidence or
facts whose references are erroneous.
[54]
For his
part, the respondent is of the opinion that the applicant’s motion cannot be
based on section 221of the Rules since this section only contemplates
pleadings filed in the context of a proceeding brought by way of action. The
respondent adds that a memorandum of fact and law is not a pleading that can be
struck out in accordance with section 221.
[55]
In
principle, section 221 does not apply in the context of an application for
judicial review (Canada (Attorney General) v. Association des
professionnels et professionnelles de la Vidéo du Québec, 2003 FCA 304, at
paragraph 1; Grandville Shipping Co. v. Pegasus Lines Ltd., S.A.,
[1994] F.C.J. No. 2036 (F.C.T.D.) at paragraph 2). However, in
exceptional circumstances a judge can intervene on the basis of his or her
inherent power, or apply section 221 by analogy, relying on section 4
(Pfeiffer v. Canada (Superintendent of Bankruptcy), 2004 FCA 192). The
judge may even strike out parts of a memorandum of fact and law if such a
measure is deemed necessary. In Canadian Broadcasting Corp. v. Taylor,
[2001] F.C.J. No. 76, at paragraphs 3 to 6, Prothonotary Morneau
writes the following, referring to Pharmacia Inc. v. Canada (Minister
of National Health and Welfare), [1994] F.C.J. No. 1629 (F.C.A.):
¶ 3
Even though the Applicant’s motion does not refer expressly to the inherent
jurisdiction of this Court, it seems to me that it must be addressed under that
jurisdiction, as applied by Strayer J.A. in Bull (David) Laboratories
(Canada) Inc. v. Pharmacia Inc. et al. (1994), 176 N.R. 48, at
pages 54-5 (“Pharmacia”). I believe that the principles stated
therein apply to this case, even though here the Applicant is seeking to
have the Intervenor’s memorandum struck out only in part, and not to have the
entire memorandum struck out. I would even say that Pharmacia applies here particularly
and therefore a fortiori, since the motion seeks to strike out only a
few paragraphs of a document.
¶ 4
In Pharmacia, Strayer J.A. allowed a motion to strike out to be made
in a judicial review proceeding only in exceptional cases. At pages 54-5,
the Court said:
This is not to say that
there is no jurisdiction in this court inherent or through rule 5 by analogy to
other rules, to dismiss in summary manner a notice of motion which is so
clearly improper as to be bereft of any possibility of success. . . . Such
cases must be very exceptional and cannot include cases such as the present
where there is simply a debatable issue as to the adequacy of the allegation in
the notice of motion.
.
. .
¶ 6
In the instant case, the aspects that the Applicant is seeking to have
corrected by making this motion are not, in the circumstances, aspects that,
even in the event that the Applicant might be correct, may be seen as so
incorrect or unacceptable that we should intervene in the process of an
application for judicial review (see the comments of Strayer J.A. in Pharmacia,
above, at pages 54-5). Any motion to strike out that is made in the course
of an application for judicial review must be an exception, so that one of
the primary objectives of such an application, which is to hear the application
on the merits as quickly as possible, may be met.
[Emphasis
added.]
[56]
I agree
with Strayer J.A. and Prothonotary Morneau. The Court must take into account
that the wording of the Rules do not provide for striking out pleadings except
in the context of proceedings by way of action (see section 169). The spirit of
the Rules is also important, and one must bear in mind that the judges have
inherent powers. Further, section 4 states that the Court may fill in shortcomings
in the Rules by making an analogy to other Rules. In short, it is a balancing
act.
[57]
As stated
earlier, the applicant’s motion has three parts. I will address the second and
third parts together.
(a) First part
[58]
First, the
applicant considers that the judgment in Beaudoin v. Banque de développement
du Canada, above, is not enforceable against him and that
the respondent cannot in his submissions use the facts referred to therein. The
judgment was the basis of the Orders adopted by the Governor in Council.
[59]
As I shall
explain hereunder, the judgment in that matter is sufficient to establish a
simple presumption of the facts found therein, even if Mr. Vennat reserved the
right to contest it within the inherent limits of the forum in which he found
himself (I address that aspect at paragraphs 138 to 144 of this
decision). Although that judgment is not enforceable against Mr. Vennat as
such, it can legitimately be used by the employer for the purposes of an inquiry,
provided that the applicant, having the appropriate tools, is afforded the opportunity
to rebut the presumption.
[60]
Further,
the respondent may properly use the judgment to present his position. The
applicant adduced the judgment into evidence as Exhibit MV-5 (applicant’s
affidavit, paragraph 19). The respondent did not have to file it into evidence
once again, since the applicant had done so.
[61]
This part
of the applicant’s motion should therefore not be granted, as the respondent is
fully entitled to base his arguments on the facts of Beaudoin v. Banque de
développement du Canada, above.
(b) Second and third
part
[62]
Second,
the applicant considers that certain paragraphs of the respondent’s memorandum
allege facts that are not supported by the evidence or that are directly
contrary to the evidence. Other paragraphs of the memorandum are based on
incorrect references.
[63]
I believe
that it suffices to say that at this stage, I need not strike specific
paragraphs of the respondent’s memorandum, and that it is only a matter of assigning
to these paragraphs the probative value that they should have, based on the
evidence.
[64]
The second
and third parts of the applicant’s motion are therefore granted in part.
VII. Analysis – Principal application–
Procedural issues
[65]
The
applicant was appointed to the position of President and Chief Executive
Officer of the BDC by the Appointment Order dated July 31, 2000. That Order in
Council was adopted pursuant to subsection 6(2) of the BDC Act, which
reads as follows:
|
6. (2) Notwithstanding subsection
105(5) of the Financial Administration Act, the President is to be
appointed by the Governor in Council to hold office during good behaviour for
a term that the Governor in Council considers appropriate and may be removed
for cause.
|
6. (2) Par dérogation au paragraphe
105(5) de la Loi sur la gestion des finances publiques, le gouverneur en
conseil nomme à titre inamovible le président pour le mandat qu’il estime
indiqué, sous réserve de révocation motivée.
|
It is therefore a position that may be characterized as a
public duty, where removal must be “for cause” (“révocation motivée”).
[66]
In
the context of an employee-employer relationship, the Supreme Court has
established that the existence of a duty to act fairly resulting from the common
law must be assessed in light of three factors (the nature
of the decision, the relationship between the employer and the employee and
the impact of the decision on the employee). The Supreme Court also decided
that legislation or a contract may alter or neutralize such a duty (Knight v. Indian Head School Div.
No. 19,
above, pages 669 to 682).
[67]
In this
case, both parties acknowledge the existence of the duty of procedural
fairness. This common position of the parties seems fair to me in light of the
tests in Knight
v. Indian Head School Div.
No. 19,
above.
[69]
The
applicant considers that the applicable safeguards are relatively elaborate
considering the case law, and he submits that they were not observed in his
case. The respondent, on the other hand, argues that the procedure followed as
regards the applicant observed the procedural safeguards elaborated by the
courts.
[70]
In Knight v. Indian Head School Div. No. 19, above, at page 682, L’Heureux-Dubé J. explains from the
outset, in her analysis regarding the nature of the duty to act fairly, that
the concept of procedural fairness is a variable concept:
Like the
principles of natural justice, the concept of procedural fairness is eminently
variable and its content is to be decided in the specific context of each case.
. . .
The approach
to be adopted by a court in deciding if the duty to act fairly was complied
with is thus close to empiric. Pépin and Ouellette, Principes de [page683]
contentieux administratif, at p. 249, quote the following colourful comment of
an English judge to the effect that “from time to time . . .
lawyers and judges have tried to define what constitutes fairness. Like
defining an elephant, it is not easy to do, although fairness in practice has
the elephantine quality of being easy to recognize”
[References
omitted.]
[71]
Knight
v. Indian Head School Div. No. 19, above, nevertheless
gives a theoretical framework for assessing the nature of the duty to act
fairly. At page 682, L’Heureux-Dubé J. cites a passage from Nicholson v.
Haldimand-Norfolk Regional Board of Commissioners of Police, [1979] 1
S.C.R. 311 and points out a passage from a decision by the Privy Council:
In Nicholson,
above, at pages 326-27, Laskin C.J. adopts the following passage from the
decision of the Privy Council in Furnell v. Whangarei High Schools Board,
[1973] A.C. 660, a New Zealand appeal where Lord Morris of Borth-y-Gest,
writing for the majority, held at p. 679:
Natural
justice is but fairness writ large and juridically. It has been described as ‘fair
play in action’. Nor is it a leaven to be associated only with judicial or
quasi-judicial occasions. But as was pointed out by Tucker L.J. in Russell
v. Duke of Norfolk [1949] 1 All. E.R. 109, 118, the requirements of natural
justice must depend on the circumstances of each particular case and the
subject matter under consideration.
[Emphasis in
the original of Knight v. Indian Head School Div.
No. 19,
above]
[72]
Later, at
page 683, L’Heureux-Dubé J. explains that the concept of fairness is not purely
subjective. At the end of her analysis, she determines that the minimal content
of the duty of procedural fairness involved in a dismissal by an administrative
body consists in notifying the employee of the reasons for the dissatisfaction
and giving the employee the opportunity to be heard (see paragraphs 191
to 212 of this decision). There must be a word of caution on that point.
In Nicholson
v. Haldimand-Norfolk Regional Board of Commissioners of Police, above, at
page 128, the Supreme Court of Canada decided that those safeguards were
sufficient in cases where the employee could only be dismissed for cause (see Knight
v. Indian
Head School Div.
No. 19,
above, at page 683). However, I believe that L’Heureux-Dubé J. gave a series of
detailed tests in Baker v. Canada (Minister of
Citizenship and Immigration), [1999] 2 S.C.R. 817, to guide in the
assessment of the substance of the duty to act fairly. I can only rely on those
tests. Baker is an update of Knight, although the ruling in Knight
remains relevant (see paragraphs 191 to 212 of this decision). In the case
at hand, it would therefore be wrong to import the safeguards applied in the
specific context of Nicholson without considering the possibility that
there could be other safeguards that apply, as the Supreme Court of Canada
subsequently formulated tests for adapting the substance of the duty to act
fairly to the circumstances of each case.
[73]
At
page 837 of Baker v. Canada (Minister of Citizenship and Immigration), above,
L’Heureux-Dubé J. explains the idea underlying the analysis of the applicable
tests, which is consistent with the comments that she made in Knight v.
Indian Head School Div. No. 19, above:
Although the
duty of fairness is flexible and variable, and depends on an appreciation of
the context of the particular statute and the rights affected, it is helpful to
review the criteria that should be used in determining what procedural rights
the duty of fairness requires in a given set of circumstances. I emphasize that
underlying all these factors is the notion that the purpose of the
participatory rights contained within the duty of procedural fairness is to
ensure that administrative decisions are made using a fair and open procedure,
appropriate to the decision being made and its statutory, institutional, and
social context, with an opportunity for those affected by the decision to put
forward their views and evidence fully and have them considered by the
decision-maker.
[Emphasis
added.]
[74]
L’Heureux-Dubé
J. then embarked on an analysis of the relevant factors to evaluate the nature
of the duty to act fairly, which are the following:
1. The nature of the decision being made and process followed in making it;
2. The nature of the statutory scheme and the terms of the statute pursuant to
which the body operates;
3. The importance of the decision to the individual or individuals affected;
4. The legitimate expectations of the person challenging the decision;
5. The choices of procedure made by the agency itself.
[75]
Then, the Court
reiterates at pages 840 and 841 that the detailed analysis of the factors must
not preclude the judge from adopting a global view:
These
principles all help a court determine whether the procedures that were followed
[page841] respected the duty of fairness. Other factors may also be important,
particularly when considering aspects of the duty of fairness unrelated to
participatory rights. The values underlying the duty of procedural fairness
relate to the principle that the individual or individuals affected should have
the opportunity to present their case fully and fairly, and have decisions
affecting their rights, interests, or privileges made using a fair, impartial,
and open process, appropriate to the statutory, institutional, and social
context of the decision.
[Emphasis
added.]
[76]
Considering
the decisions by the Supreme Court, the approach that I must follow in this
case consists in analyzing the factors established by the Supreme Court with a
view to elaborating the procedural safeguards to which the applicant is
entitled, all the while bearing in mind the premise underlying the factors
proposed by L’Heureux-Dubé J. This approach is a means of identifying the
failures to observe the duty to act fairly, if there are any. Then, I will
address the minimum procedural safeguards conferred to persons appointed to
office during good behaviour and I will determine whether they were observed.
At the end of the analysis, by adopting a global view of this matter, it will
be determined whether the duty to act fairly was observed.
A. Analysis in accordance with
the factors in Baker
(1) The nature of the decision being made and process followed in making it
(a) A
non-judicial and non-formalistic procedure
[77]
This first
factor implies assessing “the closeness of the administrative
process to the judicial process” (Baker v. Canada (Minister of
Citizenship and Immigration), above, at page 838). There is no doubt
that in this case, the process of the adoption of Orders by the Governor in
Council is very different than the process leading to a judicial decision. It
is a non-judicial and non-formalistic procedure.
[78]
This
principle must underlie my analysis of the nature of the duty to act fairly.
The nature of the decisions contemplated by this application for judicial
review gives rise to procedural safeguards that are somewhat flexible, intended
to enable the interested party to have a real opportunity to be heard.
(b) The Governor in
Council, master of the procedure
[79]
Furthermore,
the respondent considers that the absence of procedural guidelines confirms
that the Governor in Council has a very broad discretion in determining the
approach to follow. In fact, there is no dismissal procedure provided by any
legislation, the only guidance regarding the procedure to follow comes from the
precedents drawn from the case law.
[80]
For
the time being, it is enough to state that the absence of legislation regarding
procedure does not really affect the nature of the duty to act fairly. At the
very most, it is an indication that Parliament wanted to give some latitude to
the Governor in Council (I will elaborate on this aspect at paragraphs 127 to
132 of this decision). The Governor in Council nevertheless has the obligation,
despite the discretion given to her, to give the affected party a real opportunity
to respond to the reasons for the employer’s dissatisfaction (see paragraphs
197 to 212 of this decision).
(2) The nature of the statutory scheme and the terms of the law
(a)
The wording of subsection 6(2) of the BDC Act and the “for cause” requirement
drawn from the case law
[81]
The BDC
Act gives little indication regarding the procedural safeguards applicable
when the President and Chief Executive Officer of the Crown corporation is
removed.
[82]
The
applicant considers that the “for cause” requirement (in French, “révocation
motivée”) justifies the application of stricter procedural safeguards than those
for persons appointed to hold office during pleasure. Moreover, the applicant
contends that the French wording of subsection 6(2) of the BDC Act
imposes on the Governor in Council an obligation to give written reasons for
her decision. In the alternative, he submits that even if that were not the
interpretation to be given to subsection 6(2), there would nevertheless
have to be a determination that there was an obligation to give reasons as a result
of Baker
v. Canada (Minister of Citizenship and Immigration), above.
[83]
Even if
there is an apparent ambiguity resulting from the discrepancy existing between
the French version and the English version of the Act, I do not think it
necessary to engage in a long interpretative exercise. In fact, it appears, as
the applicant submitted, that even if the Governor in Council was
not obligated to give reasons for her decision by law, it would in any event be
required as a result of Baker v. Canada (Minister of Citizenship and
Immigration), above.
[84]
In
that case, L’Heureux-Dubé J. conducted an extensive analysis of the obligation
to give reasons for administrative decisions. At page 848, she determines:
It is now
appropriate to recognize that, in certain circumstances, including when the
decision has important significance for the individual, or when there is a
statutory right of appeal, the duty of procedural fairness will require a
written explanation for a decision. Reasons are [page820] required here given
the profound importance of this decision to those affected. This
requirement was fulfilled by the provision of the junior immigration officer’s
notes, which are to be taken to be the reasons for decision. Accepting such
documentation as sufficient reasons upholds the principle that individuals are
entitled to fair procedures and open decision-making, but recognizes that, in
the administrative context, this transparency may take place in various ways.
[Emphasis
added.]
[85]
In this
case, there is no doubt that reasons were necessary, for two reasons.
[86]
First, the
decision to remove the President and Chief Executive Officer of the BDC is of very
important significance to that person (see paragraphs 119 to 124 of this
decision, where I address this aspect distinctly); it follows that this person
would be entitled to know the reasons with some precision.
[87]
The requirement
for reasons is also justified by the fact that the President and Chief
Executive Officer of the BDC is appointed to hold office during good behaviour.
As the respondent acknowledges, a cause for removal is necessary in such cases.
I fail to see how a judge, in the context of a judicial review, would be able
to assess the sufficiency or the merits of the reasons if the person affected was
not duly notified of them.
[88]
In my
opinion, the Governor in Council’s obligation to give reasons was only
summarily fulfilled as regards the applicant, as appears from the Order in
Council and the letter dated March 12, 2004 (see paragraphs 31 and 32
of this decision).
[89]
The
reasons set out in the dismissal order and in the letter are as follows:
1. The loss of
confidence;
2. The
applicant’s conduct in respect of the matters addressed in the reasons for
judgment in Beaudoin v. Banque de développement du Canada is
incompatible with his continued appointment.
[90]
The courts
tend to consider that such reasons are insufficient. Referring to several
decisions, Professor Garant aptly summarizes the evolution of the requirement
for reasons in his book Droit administratif, 5th ed., Cowansville,
Éditions Yvon Blais, 2004, at pages 825 to 832. He explains certain
principles for assessing the sufficiency of reasons, at pages 829 and 830:
[TRANSLATION]
The
Federal Court of Appeal confirms that this obligation does not suggest that the
details of the decision be disclosed in minute detail.
. . .
This
reasoning can be expressed in general terms in accordance with the
administrative nature of the decisions and the extent of the decision-maker’s discretionary
power. It can be brief without being incomplete or capricious; the decision may
be “brief and technical . . . without being ‘bereft of reasons’”
Nevertheless,
an administrative tribunal cannot simply write that the evidence is
insufficient. . . . The reasoning must be “sufficient and intelligible”, even
if it is somewhat convoluted and if the decision must be considered as a whole;
a decision will be considered intelligible if the decision-maker, considering
all of the evidence in assessing the facts, develops a logical reasoning using
the facts at issue.
. . .
A
decision that does not involve any analysis of the evidence will be considered as
being without reasons.
. . .
When
a court dismisses inconsistent evidence outright, it must “give at least some
reasons for that choice”.
[References
omitted.]
[91]
Even
though useful for clarification, these guidelines need not necessarily be
strictly applied to the Governor in Council when she decides to dismiss a
public office holder appointed during good behaviour. The respondent directed
the Court’s attention to the following passage from the decision in Knight v. Indian Head School Div.
No. 19,
above, at page 685:
In
the same vein, the duty to give reasons need not involve a full and complete
disclosure by the administrative body of all of its reasons for dismissing the
employee, but rather the communication of the broad grounds revealing the
general substance of the reason for dismissal.
[Reference
omitted.]
[92]
The Governor
in Council’s obligation to give reasons should not be the same as the
obligation imposed on judicial or quasi-judicial tribunals. That said, there is
nevertheless an obligation to give reasons, namely, the obligation to inform
the affected individual of the reasons for the removal while considering the
position that this person submitted. In this case, the reasons given to the applicant
by the Governor in Council do not appear to me to fulfil that obligation to
adequately inform the applicant of the reasons for the decisions. I have no
other choice, under such circumstances, but to find that the Governor in
Council’s obligation to give reasons for the decision was breached in this case.
[93]
In fact,
there is nothing in the dismissal order or in the letter which could be
characterized as analysis or reasoning, and the reasons do not make any mention
of the position submitted by the applicant. The reader sees nothing other than findings
in the Order in Council and the letter, namely the loss of confidence and the determination
that the applicant’s conduct is incompatible with his continued appointment. There
should have been at least some degree of reasoning or analysis. The applicant was
not informed of the reasons for dismissing the written and oral arguments
submitted.
[94]
The letter
contained two types of allegations, as stated earlier, namely personal
allegations on the one hand and corporate allegations on the other (see paragraph
21 of this decision). Yet, we cannot infer from the dismissal order or the
dismissal letter which one led to the applicant’s removal. The applicant, in
light of these documents, does not know whether he was dismissed because of
personal misconduct, corporate misconduct, or both. It is true that both of
these elements are interdependent to a certain degree, but the decision is so
vague that it makes no distinction between the reasons for dissatisfaction. What
led to the applicant’s removal? Was it the applicant’s conduct as a witness? Was
it rather his professional conduct in carrying out his duties? Was it a
dismissal based on the allegations targeting the BDC as a whole? In the case of
the second hypothesis, what are the specific facts alleged against the applicant
serving as a basis for the decision? The decision in Beaudoin v. Banque de
développement du Canada, above, reported numerous facts which
could have conceivably
led to the removal. Which facts are alleged against the applicant? Were some
allegations dismissed? There is nothing to shed light on the choice made by the
Governor in Council and to help us understand what significance was assigned to
the various arguments presented.
[95]
This is
not a matter of imposing requirements for judicial or quasi-judicial reasons on
the Governor in Council but rather of asking the Governor in Council to explain
the reasons for the removal. The decision, without being reasoned in great
detail, must convey a certain reasoning taking into account the submissions
made by the applicant in his preliminary memorandum (Exhibit MV-15). The
decision must summarily explain why the arguments submitted were dismissed. The
letter could have contained this information. These requirements are certainly
not excessive when the fate, the reputation and the career of an individual is
being decided, with the knowledge that the decision will inevitably receive a
great deal of media attention.
(b) The
notion of holding office during good behaviour: a variable concept which does not
afford a basis for inferring that specific procedural safeguards apply thereto
[96]
The
President and Chief Executive Officer of the BDC is appointed to hold office
during good behaviour (BDC Act, subsection 6(2)).
[97]
Several
other federal agencies have internal office holders appointed during good behaviour.
The Governor in Council has the power, under several statutes, to appoint a
certain number of persons to hold office during good behaviour. It would be
worthwhile, by way of contrast, to briefly review the removal mechanisms
existing in federal law for persons appointed to hold office during good
behaviour.
[98]
In the
case of administrative tribunals, the legislative regime varies but the members
are as a general rule appointed during good behaviour and reasons must be given
for their removal. In certain cases, the statute provides for an inquiry and
reporting process which may include a remedial recommendation. For example, the
members of the Veterans Review and Appeal Board are appointed to hold office
during good behaviour and the law provides that the Chairperson of the Tribunal
may recommend to the Minister of Veterans Affairs that an inquiry be held, which
could lead to the removal of the member (Veterans Review and Appeal Board Act,
1995, c. 18, sections 5, 42 and 43). A similar procedure is provided
in the case of members of the Canadian Human Rights Tribunal (Canadian Human
Rights Act, R.S., 1985, c. H-6, section 48.3). The inquiry process may also be provided
for in a regulatory instrument. For example, subsection 165.21(2) of the National
Defense Act, R.C. 1985, c. N-5, provides that military judges hold office
during good behaviour for a term of five years but may be removed by the
Governor in Council for cause on the recommendation of an Inquiry Committee
established under section 101.14 of the Queen’s Regulations and Orders for
the Canadian Forces (in R. v. Corporal R.P. Joseph, 2005 CM 41, Chief
Military Judge Dutil found that the limited term of military judges is
unconstitutional but recognized the validity of the inquiry procedure established
by the regulations). The
law sometimes has a specific provision providing that the inquiry procedure
provided by law does not affect any right or power of the Governor in Council (see
for example, for members of the Immigration and Refugee Board, except members
of the Immigration Division, section 186 of the Immigration and Refugee
Protection Act, 2001, c. 27 – the inquiry process is set out in
sections 178-186).
[99]
Some
specific statutes provide for appointments to hold office during good behaviour
for directors of Crown corporations, yet without providing any specific
procedure for removal. Such is the case, for example, for directors sitting on
the Canadian Broadcasting Corporation’s Board of Directors (Broadcasting Act,
1991, c. 11, subsection 36(3)).
[100]
Certain strategic
positions have specific protection: the removal procedure must be initiated by
one or both of the Houses. The Ethics Commissioner, for example, may be subject
to removal for cause on address of the House of Commons (Parliament of Canada
Act, R.S., 1985, c. P-1, subsection 72.02(1)). The Auditor
General also enjoys special status considering the nature of his duties: he
cannot be removed except on address of the Senate and the House of Commons (Auditor
General Act, R.S., 1985, c. A-17). That is also the case for the
Privacy Commissioner (Privacy Act, R.S., 1985, c. P-21, subsection 53(2)),
the Information Commissioner (Access to Information Act, R.S. 1985,
c. A-1, subsection 54(2)), the Commissioner of Official Languages (Official
Languages Act, R.S., 1985, c. 31 (4th Supp.), subsection 49(2)) and
the Public Sector Integrity Commissioner ( Public Servants Disclosure
Protection Act, 2005, c. 46, subsection 39(2)). In the case of
the Superintendent of Bankruptcy, the dismissal order is simply laid before
each House of Parliament (Office of the Superintendent of Financial
Institutions Act, R.S., 1985, c. 18 (3rd Supp.), subsection 5(3)).
[101]
The
prothonotaries of the Federal Court are also appointed by the Governor in
Council to hold office during good behaviour, but may be removed for cause (“révocation
motivée”) (FCA, paragraph 12(7)), and no specific procedure is provided
for their removal.
[102]
Finally, in
the case of superior court judges, there is a detailed removal procedure provided
for in sections 63 to 66 and 71 of the Judges Act, R.S.C. 1985,
c. J-1 (Judges Act). The principle of judicial independence, repeatedly recognized
by the courts, guarantees them a degree of independence that no other office
holder enjoys.
[103]
These
examples help to illustrate that there is more than one type of office held
during good behaviour. In fact, there is a very extensive range of offices
whose holders are appointed during good behaviour and there is not the same
degree of procedural protection in every case. It would therefore be incorrect
to assign too much significance to the expression “to hold office during good
behaviour” found in the legislation.
[104]
In my
opinion, the procedural safeguards benefiting these persons vary according to
the factors set out in Baker v. Canada (Minister of Citizenship and
Immigration), above,
and the statements of the Supreme Court in Knight v. Indian Head School Div.
No. 19,
above. In other words, the nature of the duty to act fairly depends on a comprehensive
analysis, and not on a secular legal category whose importance has indeed been
put into perspective in Knight v. Indian Head School Div.
No. 19,
above, pages 670 to 676. The applicant is not wrong to argue that holding
office during good behaviour under the terms of the BDC Act is based
historically on judges’ holding office during good behaviour, but I believe
that this is a relatively minor aspect of the debate, considering the variety
of removal procedures existing in federal law and the evolution of the concept
of holding office during good behaviour.
[105]
To
summarize, the concept of holding office during good behaviour is not in itself
enough to substantiate finding an automatic and clearly defined acknowledgement
of specific procedural safeguards. That said, Parliament’s use of the term: “during
good behaviour” is not insignificant. It is certainly an important indication of
its intention to give the President and Chief Executive Officer of the BDC enhanced
procedural safeguards. This becomes clear on analyzing the status of the BDC within
the federal system and the purpose assigned to it.
(c)
The status and the purpose of the BDC: Enhanced procedural safeguards
[106]
Both
parties insisted a very great deal during their arguments on the importance of
the status and the purpose of the BDC. The BDC administers in excess of
five billion dollars in assets and is responsible for granting commercial loans
to small and medium-sized businesses and for injecting venture capital (see
Exhibit MV-5, page 88, paragraphs 685 and 686). The press release dated February
18, 2004, contains a relevant passage regarding the BDC’s role:
The Business
Development Bank of Canada is a financial institution wholly owned by the
Government of Canada. BDC plays a leadership role in delivering financial,
investment and consulting services to Canadian small businesses, with a
particular focus on the technology and export sectors of the economy.
[107]
The
applicant submitted that appointments to hold office during good behaviour are
meant to ensure that some of those holding offices of importance to the public
service have a certain degree of independence, to shelter them from political
interference. The respondent argued that the importance of the institution
implies that the person managing it must be held responsible for its proper
operation and that this person must assume responsibility for the errors made
at the BDC. The respondent also argued that the President and Chief Executive
Officer of the BDC is appointed to hold office during good behaviour in order
to protect the public, not the office holder. In my opinion, neither party is incorrect.
[108]
In my view,
the President and Chief Executive Officer of the BDC may certainly be held
responsible, to a certain extent, for what occurs within the agency that he is
overseeing. However, that does not have any bearing on the procedural safeguards
which must be offered to the office holder.
[109]
The
appointment to hold office during good behaviour at the head of a Crown
corporation is an exceptional regime and the purpose of this regime is the one
described by the applicant, i.e. the relative independence of the office holder.
That independence also has a public aspect in the sense that its purpose is to
enable the President and Chief Executive Officer of the BDC to act in the
public interest.
[110]
Subsection
105(5) of the Financial Administration Act, R.S.C. 1985,
c. F-11 (FAA) provides that as a general rule, each officer-director of a parent
Crown corporation shall be appointed to hold office during pleasure. The
appointment of the President and Chief Executive Officer of the BDC is an
exception to that rule (BDC Act, subsection 6(2)). In my opinion,
that is a sign that Parliament wanted that person to have discretion, to a
certain extent, in carrying out his or her duties, in the interest of the
office holder as well as in the interest of the public. Otherwise, the Act
would have provided that the Governor in Council appoint the President and Chief
Executive Officer to hold office during pleasure.
[111]
After a
brief overview, I have been able to identify three federal corporations whose
chief executive officers are appointed to hold office during good behaviour and
who can be removed for valid reasons at the initiative of the Governor in
Council. These are the Canadian Broadcasting Corporation (Broadcasting Act,
1991, c. 11, subsection 36(3)), the Bank of Canada (Bank of Canada
Act, R.S., 1985, c. B-2, subsection 6(3)) and the BDC. In all
three cases, they are corporations that Parliament wanted to shelter, to a certain
extent, from political interference.
[112]
The
presidents of several other corporations are appointed during pleasure, such as
Export Development Canada (Export Development Act, R.S. 1985,
c. E-20, subsection 8(1)), the Canada Mortgage and Housing Corporation
(Canada Mortgage and Housing Corporation Act, R.S. 1985, c. C-7, subsection 7(1))
and the Canada Post Corporation (Canada Post Corporation Act, R.S. 1985,
c. C-10., subsection 8(1)). The respective mandates of these
corporations are very important, but Parliament chose nevertheless not to appoint
their directors during good behavior. I must recognize this distinction that Parliament
chose to make.
[113]
Furthermore,
it is understandable that the President and CEO of the BDC would have special
status as compared to other presidents of Crown corporations, given the purpose
of the BDC, described at section 4 of the BDC Act:
|
4.
(1) The purpose of the Bank is to support Canadian entrepreneurship by
providing financial and management services and by issuing securities or
otherwise raising funds or capital in support of those services.
(2)
In carrying out its activities, the Bank must give particular consideration
to the needs of small and medium-sized enterprises.
|
4.
(1) La Banque a pour mission de soutenir l’esprit d’entreprise au Canada en
offrant des services financiers et de gestion et en émettant des valeurs
mobilières ou en réunissant de quelque autre façon des fonds et des capitaux
pour appuyer ces services.
(2)
Dans la poursuite de sa mission, la Banque attache une importance
particulière aux besoins des petites et des moyennes entreprises.
|
[114]
The
relative independence conferred on the President of the BDC is meant to ensure
that the holder of this office can carry it out in the public interest. In
that respect, the office of the President and Chief Executive Officer of the
BDC has a public dimension which is closely connected to the protection extended
to the individual. The individual’s protection goes hand-in-hand with the
public’s protection.
[115]
The public
must have confidence in the agency and its President and Chief Executive
Officer. Aside from carrying out its duties in the public interest, the institution
must project the image that it is working in the public interest. That would
not be the case in a situation where the public believed, correctly or not, that
the President and Chief Executive Officer of the BDC was very vulnerable vis-à-vis
the Governor in Council and was therefore more preoccupied by political
interests than by the public interest. That said, Parliament did not choose to
give total independence to this person (like the kind of independence that
judges have), or to give him/her independence close to it (like the
independence given to the Public Service Integrity Commissioner or to the
Auditor General).
[116]
All of
these considerations relating to the status and the role of the BDC and to the
security of tenure of its President and Chief Executive Officer confirm that he
must benefit from enhanced procedural safeguards.
(d) The
absence of a right to appeal confirms that enhanced procedural safeguards must
be recognized
[117]
In the
matter of Baker
v. Canada (Minister of
Citizenship and Immigration), above, at paragraph 24, L’Heureux-Dubé J.
recognized that the absence of a right to appeal is a relevant test in
determining the substance of the duty to act fairly.
[118]
The fact
that the applicant does not have a right to appeal is an additional factor
confirming in my opinion that Parliament meant to extend procedural safeguards
to the President and Chief Executive Officer in the event of removal.
(3) The importance of the decision to the individual affected
[119]
The more
important a decision is to the person affected, the stricter the applicable
procedural safeguards will be (Baker v. Canada (Minister of
Citizenship and Immigration), above, page 839).
[120]
On
this point, it is well established in the case law that a person’s right to
work gives rise to certain strict procedural safeguards. In Kane v. Board of
Governors of the University of British Columbia, [1980] 1 S.C.R. 1105, at
page 1106, Dickson J. writes that “. . . A high standard of
justice is required when the right to continue in one’s profession or
employment is at stake.” It is a first relevant factor in assessing the importance
of the decision for the applicant.
[121]
The
importance of the decision for the affected person cannot be assessed without
taking into consideration the impact of the decision on the reputation of that person.
The Supreme Court emphasized the importance of preserving a person’s reputation
in a situation involving defamation. In Hill v. Church of Scientology of
Toronto, [1995] 2 S.C.R. 1130, at paragraph 108, Cory J. writes:
Democracy has
always recognized and cherished the fundamental importance of an individual.
That importance must, in turn, be based upon the good repute of a person. It
is that good repute which enhances an individual’s sense of worth and value.
False allegations can so very quickly and completely destroy a good reputation.
A reputation tarnished by libel can seldom regain its former lustre. A
democratic society, therefore, has an interest in ensuring that its members can
enjoy and protect their good reputation so long as it is merited.
[Emphasis
added.]
[122]
Although
Cory J.’s remarks were written in the context of an action in defamation, I
believe that the importance of an individual’s reputation is well established
in the case law (see in particular Prud’homme v. Prud’homme, [2002] 4
S.C.R. 663, at paragraph 43, where the Court recognizes that the freedom
of speech may be limited by the right to reputation). When the reputation of a
person can be jeopardized by an administrative decision, the administrative
process must necessarily take that into account.
[123]
In
this case, the applicant’s reputation was certainly tainted to some extent by
the decision in Beaudoin
v. Banque de développement du Canada, above. The Governor in Council’s
Orders were just as significant despite this, because of their foreseeable
impact on Mr. Vennat’s reputation.
[124]
In
short, the foreseeable impact of the Governor in Council’s Orders on the
applicant’s right to work and his right to a reputation is an additional
indication that the situation called for the application of enhanced procedural
safeguards.
(4) The legitimate
expectations
[125]
At pages 839
and 840 of Baker
v. Canada (Minister of
Citizenship and Immigration), above, L’Heureux-Dubé J. explains the significance
of the legitimate expectations factor on the obligation of fairness:
[T]he legitimate
expectations of the person challenging the decision may also determine what
procedures the duty of fairness requires in given circumstances. Our Court has
held that, in Canada, this doctrine is part of the doctrine of fairness or
natural justice, and that it does not create substantive rights . . . As
applied in Canada, if a legitimate expectation is found to exist, this will
affect the content of the duty of fairness owed to the individual or
individuals affected by the decision. If the claimant has a legitimate
expectation that a certain procedure will be followed, this procedure will be
required by the duty of fairness . . . Similarly, if a claimant has a
legitimate expectation that a certain result will be reached in his or her
case, fairness may require more extensive procedural rights than would
otherwise be accorded . . . Nevertheless, the doctrine of legitimate
expectations cannot lead to substantive rights outside the procedural domain.
This doctrine, as applied in Canada, is based on the principle that the “circumstances”
affecting procedural fairness take into account the promises or regular
practices of administrative decision-makers, and that it will generally be
unfair for them to act in contravention of representations as to procedure, or
to backtrack on substantive promises without according significant procedural
rights.
[126]
In this
case, the applicant expressed in different ways to the decision-maker his
expectations regarding the procedure. They need not be addressed since I do so
elsewhere in this decision. I shall simply list them:
1. The
applicant considers that he was entitled to a reasoned decision (see paragraphs
81 to 95 of this decision);
2. The
applicant believes that he was entitled to a personalized inquiry (see paragraphs
133 to 174 of this decision);
3. The
applicant considers that he should have been entitled to call witnesses since,
so he claims, there was an attempt to enforce a judgment against him (see
paragraphs 145 to 148 of this decision);
4. The
applicant considers that he should have had [TRANSLATION] “the opportunity to defend
himself before an impartial and independent tribunal whose decision is not
dependant on political pressure, influenced by the polls, and/or by media hype,
but rather respectful of the rights of the parties including the rights of
Michel Vennat” (letter dated March 10, 2004) (see paragraphs 180 to 184 of
this decision);
5. The
applicant considers that he was entitled to a response to the letters he sent
on March 4 and March 10, 2004 (see paragraphs 185 to 190 of this decision);
6. The
applicant is of the opinion that he was entitled to particulars regarding the
reasons for the Governor in Council’s dissatisfaction, as he had requested them
in the letter dated February 25 (see paragraphs 194 to 196 of this decision);
7. The
applicant submits that he was entitled to be heard, as he indicated in his
letter to the Prime Minister (see paragraphs 197 to 212 of this decision);
8. The
applicant considers that he should have been entitled to more time to respond
to the reasons for dissatisfaction and to make his submissions (see paragraphs
201 to 205 of this decision);
9. The
applicant believes that it was legitimate to request Mr. Ritchie be
present at the meeting of March 1, 2004 (see paragraphs 206 and 207 of this decision).
(5) The procedural choices of the decision-making body
(a) A non-judicial and non-formalistic procedure
[127]
The
respondent, in his arguments as well as in his memorandum, emphasized the
argument to the effect that the Governor in Council is the master of her
procedure and that inflexible administrative rules cannot be imposed on her
because of her institutional constraints.
[128]
The
applicant did not dispute this argument, but contended that the existence of
the procedure for the optional inquiry by the Judicial Council, provided under
section 69 of the Judges Act, is an indication of Parliament’s
intention to protect persons appointed to hold office during good behaviour
against the Governor in Council’s arbitrariness.
[129]
I
appreciate the respondent’s argument, considering the very special nature of
the Governor in Council’s decisions and the fact that there is no legislation
defining the power to remove the President and Chief Executive Officer of the BDC. The
Governor in Council is not obliged to judicialize this procedure.
[130]
In
particular, I do not believe that it would be appropriate to impose a procedure
similar to the one provided under section 69 of the Judges Act,
since it is optional when a person appointed to hold office during good
behaviour is removed. This is apparent on the face of the section, as Sharlow J.
confirmed in Weatherill v. Canada (Attorney General), [1999] 4 F.C. 107, at
paragraph 82. I also reviewed the adjudication in Dingwall v. Canada (Attorney General) (January 19, 2006),
Toronto (adjudication award), which
is a unique case (applicant’s additional authorities, tab 2). In my
opinion, the cases where the Governor in Council decides to refer a matter to
an arbitrator, or to use the procedure under section 69 of the Judges
Act, are particular cases where the Governor in Council has decided to make
the process more formal. That does not have the effect of binding the Governor
in Council in the future. The Governor in Council is free to decide whether or
not to use such mechanisms.
[131]
This does
not mean that the Governor in Council can deviate substantially from the
guidelines that she herself drew up when she decides not to use one of these “external
assessment” mechanisms. It would in fact be contrary to the duty to act fairly if
there were disparity in the treatment of two individuals in similar situations,
unless that unfairness were justified by the circumstances of the case, in
light of the factors set out in Baker v. Canada (Minister of Citizenship
and Immigration), above, as well as the comments of the Supreme Court in Knight v.
Indian Head School Div. No. 19, above. The case law
has created a number of procedural guidelines.
[132]
It
is in this context, that in my opinion, I should address whether the Governor
in Council had an obligation to conduct a personalized inquiry into the facts
on which she intended to rely to remove the applicant from his position at the
BDC. If such an obligation exists, it is necessary to determine whether the
applicant had a right to respond to the findings of the personalized inquiry (I
explain my choice to use the expression “personalized inquiry” at paragraphs 175 to
179).
(b) The
Governor in Council’s obligation to conduct a personalized inquiry
and the right to respond
[133]
At the
hearing, the applicant submitted that the Governor in Council had the obligation
to investigate his conduct despite the gravity of the judge’s remarks about him.
The respondent argued that the Governor in Council did not have such an
obligation, as the judgment in Beaudoin v. Banque de développement du Canada,
above, was in itself, in his opinion, a complete report on Mr. Vennat’s
conduct at the hearing and in the context of his duties at the BDC. According
to the respondent, the Governor in Council’s obligation to investigate was
limited to the meeting, reading the judgment, reading the additional documents
submitted by the applicant and reading his preliminary memorandum, as well as
the recommendation by the Minister of Industry. Was that sufficient considering
Baker
v. Canada (Minister of
Citizenship and Immigration), above, and the case law involving facts
which are in some respects analogous to the facts of this matter?
[134]
To assess
the extent of the Governor in Council’s obligation to investigate in this case,
we must first determine the exact role that the decision in Beaudoin v.
Banque de développement du Canada, above,
could legitimately play in this case. Then it will be a matter of analyzing the case law to
determine whether the Governor in Council had the obligation to conduct a
personalized inquiry. Finally, were such an obligation to exist, I would have
to verify if it had been fulfilled.
(i) The
use of the judgment in Beaudoin v. Banque de développement du Canada
[135]
The Governor
in Council’s decision was based on the issuance of the decision in Beaudoin
v. Banque de développement du Canada, above. As appears from the letter of
the Minister of Industry dated February 24, 2004, this decision was the basis
for the Governor in Council’s reasons for dissatisfaction.
[136]
The
applicant argued that the Governor in Council could not use the judge’s remarks
in Beaudoin v. Banque de développement du Canada, above, to remove him, since these remarks were
incidental and were not part of the reasons for judgment. He adds that under
the Code of Civil Procedure, R.S.Q., c. C-25, there were no procedural
means available to him to appeal or dispute the decision. In the alternative,
he argued that if the Governor in Council wanted to enforce the outcome of a
judgment against him, he should have a corresponding right to respond, including
the right to examine and cross-examine witnesses.
[137]
I will
first address the principal argument, then the alternative argument.
(i.1) The
judgment creates a simple presumption of facts
[138]
The
respondent is of the opinion that the enforceability of the judgment is a moot
point since the Governor in Council did not enforce the judgment against the applicant
in the legal sense of the term. In his opinion, the judgment must simply be considered
as the source of the Governor in Council’s reasons for dissatisfaction.
[139]
On this
point, I agree with the respondent: the judgment was not used to enforce a
judicial finding against the applicant, subject to my comments later on
regarding the incorrect standard of proof applied by the Governor in Council (see
paragraphs 208 to 212 of this decision). The circumstances of this matter
must be distinguished from a case where, for example, the guilt of a person has
been established in a criminal matter (such as Toronto (City) v. Canadian Union of Public Employees
(C.U.P.E.), Local
79, [2003] 3 S.C.R. 77). In such a case, it is impossible, in a civil matter, to
call that finding into question. In Vennat v. Canada (Procureur Général), [2005] J.Q. No. 3772, at
paragraph 52 (a judgment that deals with a series of motions made by the
applicant in his action for damages in the Quebec Superior Court), Émery J. properly
summarized the case law on this issue:
[TRANSLATION]
[C]ertain guidelines
emerge from the outset. The Denis judgment is not a “significant juridical fact”
in this case. In the best case scenario for the Attorney General, it appears
that this judgment can only give rise to a simple presumption of the truthfulness
of the facts involving Mr. Vennat. As it is not a significant juridical
fact as in the case in the matter of Ali and that of the City of Toronto,
the applicant will be granted leave to file any evidence tending to contradict
the findings of Denis J. regarding him.
[References
omitted.]
[140]
To me it seems
normal that an employer, whatever employer it may be, would bring disciplinary
proceedings against an employee who had an inappropriate attitude in Court, or
whose conduct was reprehensible in the performance of his duties. When such
remarks come from superior court judge who has had privileged access to
abundant evidence, the remarks are of particular significance, even if those
remarks do not amount to a juridical fact. I note the judge’s remarks regarding
the conduct of several witnesses at the hearing, including the applicant, as
well as the cautionary notes in the judgment (see, in particular, the sections
entitled [TRANSLATION] “Warning” and “The testimony”, at
paragraphs 23 to 39 of the decision). The employer cannot disregard such
remarks, nor take them as proved.
[141]
The
respondent relied on Lawyers Title Insurance Corporation v. Michalakopoulos,
[2004] J.Q. No 10724 (Mongeon J.). This matter seems relevant in that it will help
me illustrate my thought.
[142]
In that
matter, the plaintiff was relying inter alia on the remarks made by a
judge concerning a lawyer’s conduct to establish the lawyer’s civil liability.
Mongeon J. found, at paragraph 150, that the reasons for judgment were a set
of juridical facts admissible into evidence which created a simple presumption of
facts, [TRANSLATION] “essentially rebuttable”.
[143]
That
statement can be applied in this case, by adapting it. The decision in Beaudoin
v. Banque de développement du Canada, above, did not change the applicant’s
legal situation. The proceeding involved the homologation of the transaction between
the BDC and Mr. Beaudoin, as well as the BDC’s counterclaim. Mr.
Vennat was not the person contemplated in the legal proceeding and he had no right
to speak therein except as a witness, in his capacity as President and Chief
Executive Officer of the BDC. The facts of the judgment therefore cannot
be set up, stricto sensu, against the applicant.
[144]
However,
in my opinion the employer would be entitled to assign more probative value to
the remarks of a well-informed superior court judge than, for example,
anonymous allegations made by an informant or isolated client complaints. This
does not mean, however, that the employer does not have to respect the duty to
act fairly. In Lawyers Title Insurance Corporation v. Michalakopoulos, above,
Mr. Michalakopoulos was heard as a defence witness, had the opportunity to
submit his evidence, to cross-examine the other parties’ witnesses and to make
his submissions. In short, he had the opportunity to argue his point of view. Similarly,
Mr. Vennat should have the right to argue his point of view against the
presumption against him, while taking into consideration the limits inherent to
the particular forum in which he is participating and all of the factors of Baker v.
Canada (Minister of Citizenship and Immigration), above.
(i.2) The
applicant does not have the right to examine and cross-examine witnesses
[145]
The
applicant considers that insofar that the comments of the judge in Beaudoin
v. Banque de développement du Canada, above, were made after a hearing
where the parties had the right to examine and cross-examine witnesses, he
should have a corresponding right before the Governor in Council.
[146]
If I were
to accept the applicant’s argument that an administrative decision-maker who
brings in before her the remarks of a judge must also bring in the procedural
safeguards existing before the judge, it would have the effect of judicializing
a proceeding which is not judicial by nature. It would be inappropriate to
impose such an obligation, indeed specifically rejected by Sharlow J. in Weatherill
v. Canada (Attorney General), above, at paragraph 87.
The decision-making process applicable to the removal of a person appointed to
hold office during good behaviour can be non-judicial and non-formalistic (see
paragraphs 77, 78 and 127 to 132 of this decision).
[147]
The
applicant wanted certain persons to be able to file written statements
corroborating his version of the facts, such as, for example, John Manley, who
was the Minister of Industry during the second half of the 1990s, former Deputy
Ministers of Industry, members of the BDC Board of Directors, Mr. Ritchie,
certain officers of the BDC, representatives of the Clerk of the Privy Council
Office, the Office of the Auditor General, and the KPMG accounting firm as well
as BDC counsel.
[148]
This type
of procedure appears to be consistent with the type of inquiry which the Governor
in Council should have conducted, while testimonial evidence is more consistent
with the judicial process. However, the Governor in Council was entitled to
agree or disagree with the written submissions, subject to her obligation to
conduct a personalized inquiry (see paragraphs 165 to 174 of this decision). The
Governor in Council has significant leeway in determining what means will
achieve the procedural fairness objective.
(ii) The
case law
[149]
Two
decisions are relevant in assessing the inquiry that the Governor in Council
was bound to conduct, if she had such an obligation. They are Wedge v. Canada
(Attorney General), [1997] F.C.J. No. 872 (F.C.) (Mackay J.) and Weatherill
v. Canada (Attorney General), above.
[150]
I would
stress that my objective is not to say that Mr. Vennat is entitled, in
principle, to the same procedural safeguards as Messrs. Wedge and Weatherill, but
rather to use these two decisions as an example. It would be wrong to consider
that all appointments to hold office during good behaviour fall into one
homogenous category of employment having specific procedural safeguards (see paragraphs
96 to 105 of this decision). However, there is nothing that would justify
giving Mr. Vennat fewer rights than Messrs. Wedge and Weatherill in terms
of his right to benefit from an inquiry, considering the factors in the case
law relating to the duty to act fairly (see paragraph 74 of this decision).
(ii.1) Wedge v. Canada (Attorney General)
[151]
In this
first case, Mr. Wedge was removed, on October 27, 1994, from his position
as a member of the Veterans Appeal Boards (VAB). The procedure followed by the Governor
in Council can be summarized as follows.
[152]
Around May
or June 1993, Mr. Wedge learned that the Royal Canadian Mounted Police (RCMP)
was investigating allegations that he had been involved in irregularities that
took place during the provincial elections in March 1993 in Prince Edward
Island (P.E.I.). In December 1993, the RCMP determined that there was no
evidence that the offences had been committed (first report). No charge was
laid.
[153]
On May 2, 1994,
Margaret Bloodworth of the Privy Council Office sent the applicant a letter
reporting a concern regarding his capacity to continue to sit on the VAB. According
to the letter, the applicant had allegedly aided and abetted three individuals
in voting in the P.E.I. election, knowing that those individuals did not have
the right to vote. The letter stated that the Clerk of the Privy Council had
asked Ms. Bloodworth and Twila Whalen, President of the VAB, to examine
the applicant’s conduct and to prepare a report. An investigative report prepared
by private investigators on behalf of the Minister of Justice was attached to
the letter (second report). This report set out “in detail”, in Mackay J.’s
opinion, the allegations that had given rise to the concern. Moreover, the
letter expressed a certain openness, inviting the applicant to “comment on the
accuracy of the facts included in the investigation report [at a later meeting]”.
[154]
On May 9,
1994, a meeting took place. The applicant and his counsel attended, as well as Ms. Bloodworth
and Ms. Whalen. In September 1994, the review by Ms. Bloodworth and
Ms. Whalen ended. In a letter dated September 19, 1994, the applicant
received a copy of the report prepared by Ms. Bloodworth and
Ms. Whalen (third report) and was invited to respond to it, by making
written submissions which would be sent to the Governor in Council. On
October 6, 1994, Mr. Wedge sent his submissions to the Governor
in Council.
[155]
The two reports
were then sent to the Governor in Council, who chose to remove the applicant,
on the recommendation of the Minister of Veterans Affairs.
(ii.2) Weatherill
v. Canada (Attorney General)
[156]
This
decision by Sharlow J. deals with the Governor in Council’s removal, on January 27,
1998, of John Frederick William Weatherill (Mr. Weatherill) from his
position as President of the Canada Industrial Relations Board. The procedure
followed in this matter may be summarized as follows.
[157]
In April 1997,
the Minister of Labour asked the Office of the Auditor General to review the
travel expenses, allowances and benefits paid to the applicant and to other
members of the Canada Labour Relations Board.
[158]
At the
beginning of October 1997, the applicant received a draft of the chapter of the
Auditor General’s Report contemplating him personally. This draft stated that Mr. Weatherill’s
pattern of expenditures on travel and hospitality was not reasonable. The applicant
was invited to point out any inaccuracies in the draft chapter before October 17,
1997, and he was given the opportunity to meet the auditors if he so desired. On
October 9, Mr. Weatherill asked for more time to respond. The deadline was
extended to October 20, 1997. The applicant responded in writing.
[159]
The
Auditor General prepared a report on the issue, and a copy was sent to the
applicant on November 7, 1997 (report #1). The report included the
applicant’s written response.
[160]
On
December 2, 1997, Nicole Jauvin, Deputy Clerk of the Privy Council Office,
wrote to Mr. Weatherill to tell him that the Governor in Council would
determine, in light of the report, whether there were reasons justifying his
removal. The letter indicated that Ms. Jauvin would examine the issue and prepare
a report. The letter also offered Mr. Weatherill the opportunity to meet
with Ms. Jauvin to give her his remarks and relevant additional information,
if necessary.
[161]
Dennis
Hefferson, counsel acting on behalf of Mr. Weatherill, met with Ms. Jauvin
on December 5, 1997. At that time, Mr. Hefferson argued that there was
insufficient time to respond and that he wanted to have access to the working
documents used to prepare the Auditor General’s report. There were several exchanges
during December between Mr. Hefferson, Ms. Jauvin and, on one
occasion, representatives of the Auditor General. Mr. Hefferson had access
to some information but did not have access to other information. Mr. Henderson
was given additional time to prepare himself and a meeting was scheduled for
December 17 or 18, 1997. Around mid-December, Ms. Jauvin sent Mr. Hefferson
additional information. On December 14, Mr. Hefferson wrote to Ms. Jauvin,
telling her that the procedure provided under section 69 of the Judges
Act had not been followed. On December 16, 1997, Ms. Jauvin responded to Mr. Hefferson,
indicating that she did not share his opinion regarding section 69 of the Judges
Act. She reiterated that she wanted a meeting to take place on December 17
or 18, 1997. Also on December 16, Mr. Hefferson wrote once again to
Ms. Jauvin, telling her that he did not have any information enabling him
to respond adequately and reiterated his position regarding section 69 of
the Judges Act.
[162]
There were
then conference calls between Mr. Hefferson and counsel from the Privy
Council Office; there was continued disagreement regarding the application of
section 69 of the Judges Act.
[163]
Ms. Jauvin
completed her report (report #2), and a copy was sent to Mr. Weatherill on
December 24, 1997. The letter states that the report would be sent to the Governor
in Council. Mr. Weatherill was given until January 16, 1998, to
send a response, which would be given to the Governor in Council. The applicant
did not avail himself of this offer.
[164]
On January
7, 1998, Mr. Weatherill sought an order from the Federal Court preventing
the Governor in Council from considering the question of removal in the absence
of an inquiry under section 69 of the Judges Act. The application was
dismissed on January 23, 1998. Mr. Weatherill appealed the decision on
January 26. That day, the Privy Council Office once again gave Mr. Weatherill
the opportunity to send it written submissions, this time before January 28, 1998.
On January 28, 1998, Mr. Weatherill’s application for an interim injunction
until the hearing of the appeal before the Federal Court of Appeal was
dismissed. On January 29, 1998, Mr. Weatherill received a new letter
informing him that the process was following its course. The same day, a
dismissal order was adopted. The appeal before the Federal Court of Appeal was
therefore moot, but Mr. Weatherill nevertheless applied for a judicial
review of the decision.
(iii) Findings
regarding the obligation to conduct a personalized inquiry and the right to
respond
[165]
For the
following reasons, it is my opinion that in this case the Governor in Council
had an obligation to conduct a personalized inquiry, and that this obligation was
not observed.
[166]
The two
matters above illustrate that the Governor in Council, in the context of an
employer- employee relationship, normally conducts a personalized inquiry into
the facts even if those facts appear to have been established generally in a
fact-finding report, and the employee has a right to respond. In Wedge, the
second and third reports contemplated Mr. Wedge personally, and he could
have responded to them. Similarly, in Weatherill, report #2 contemplated
Mr. Weatherill, and he had the opportunity to argue his point of view and
to point out inaccuracies in the record before the decision was made by the Governor
in Council. The applicant did not have that chance.
[167]
Even if
the judge’s remarks in Beaudoin v. Banque de développement du Canada, above, should have significant weight in the
eyes of an employer (see paragraphs 138 to 144 of this decision), I do not
think that this means that the employee loses the right to a personalized inquiry
by the Governor in Council. Such an inquiry should have been conducted by
the Governor in Council.
[168]
Further,
it appears to me that the applicant’s formal request for an inquiry should have
prompted a different reaction from the Governor in Council. The evidence
establishes that the applicant had an exemplary professional record and an
untainted reputation before the judgment in Beaudoin v. Banque de
développement du Canada, above. The applicant, who did not have a right
to appeal, strenuously contested the truthfulness of certain facts relied on in
the judgment (letter dated March 1, 2004 and a preliminary memorandum). Further,
the applicant offered to submit witnesses and evidence to the Governor in
Council contradicting certain facts of the judgment, and he formally requested,
in his letter dated March 10, 2004, that an inquiry be held pursuant to
section 69 of the Judges Act. Even though that does not give rise
to an obligation for the Governor in Council to hear witnesses (see sections 145
to 148 of this decision) or trigger the application of the procedure under
section 69 of the Judges Act (see paragraph 130 of this decision),
it seems to me that these requests, as well as the applicant’s denial of the
facts alleged, are circumstances which would play a role in justifying a more
elaborate inquiry.
[169]
The
complexity of the matter justified such an inquiry. As I explained earlier, the
reasons for dissatisfaction with the applicant consisted of two components (see
paragraph 21 of this decision). The corporate component, in particular, was
extraordinarily complex. The facts of the matter implicated numerous players
who contradicted each other at the hearing. The judgment in Beaudoin v.
Banque de développement du Canada, above, was issued following more
than two months of hearings. Thirty-five witnesses were heard and the judgment
has 1745 paragraphs. Approximately 8000 pages of transcript were filed (Beaudoin
v. Banque de développement du Canada, above, at paragraph 25). In
order to make an enlightened decision regarding the allegations directed
against the applicant, the Governor in Council ought to have proceeded to a
specific analysis of the applicant’s conduct, which could only come from a
serious inquiry and a personalized review of the facts. Further, the position of
the BDC’s Board of Directors and its expression of
unanimous confidence in Mr. Vennat had to be taken into account.
[170]
According
to the circumstances of this case, procedural fairness required that a
personalized inquiry be conducted before proceeding with the applicant’s
removal, even if the judgment created a simple presumption of facts (see
paragraphs 138 to 144 of this decision). For the applicant to properly attempt
to reverse the presumption, the decision-maker should have allowed him to
present his evidence by affidavit, interviews or counter-evidence in the context
of that personalized inquiry. The applicant could not, in less than eight days,
review all of the relevant evidence in order to rebut the presumption. That
time period was clearly insufficient (see paragraphs 201 to 205 of this
decision). The fact that the position held by Mr. Vennat was a public office
does not have the effect of compromising Mr. Vennat’s right. The factual
situation described in this case, and the type of investigation conducted, do not
reflect a high standard of justice, considering the significant impact of the
decision on the applicant’s career and reputation. This is a breach of
procedural fairness.
[171]
The
respondent submits that at the meeting of March 1, 2004, the applicant was entitled
to dispute the inaccurate facts alleged against him, if there were any. The
respondent considers that this gave the applicant direct access to the person
holding the power to make a recommendation to the Governor in Council, namely
the Minister of Industry. According to the respondent, that procedure was more
favourable for the applicant than a personalized inquiry, and could substitute
it.
[172]
In my
opinion, this argument cannot succeed for two reasons. First, the applicant’s
right to respond to the reasons for dissatisfaction (see paragraphs 197 to 212 of
this decision) must, in my opinion, be assessed by taking into account the
complexity of the facts submitted to the judge in Beaudoin v. Banque de
développement du Canada, above, as well as the time available to the
applicant. Further, the right to respond to the employer’s reasons for
dissatisfaction does not extinguish the right to a personalized inquiry when
such a right exists. This inquiry, in itself, is the only safeguard enabling
the decision-maker to make an enlightened decision, with full knowledge of the
case, in cases where the person is appointed to hold office during good
behaviour and can only be removed for cause (“révocation motivée”).
[173]
There is
nothing in this case that would suggest that the Governor in Council conducted
a personalized inquiry. To the contrary, a review of applicant’s affidavit, the
dismissal order, the dismissal letter and the letter dated February 26, 2004,
confirms that the Minister of Industry simply reviewed and heard the applicant’s
submissions and read the judgment in Beaudoin v. Banque de développement du
Canada, above, before making his recommendation. In that situation, how
could the Governor in Council properly appreciate the applicant’s actions and
make a decision accordingly? The record is silent on that point.
[174]
It seems
to me that a high standard of justice requires the decision-maker to do more
than read the judgment, review and hear the applicant’s submissions. It
appears to me that a personalized inquiry is a key element in ensuring that
high standard of justice in the circumnstances of this case.
(iv) Meaning
of the expression “personalized inquiry” [“enquête personalisée”]
[175]
Finally,
certain clarifications are in order regarding my choice of vocabulary. That
will help explain what should be understood by the expression “personalized
inquiry” [“enquête personalisée”].
[176]
In Wedge,
the judge uses the term “investigation” to describe the first and second report
and uses the expression “review” (“examen” in French) for the third report. In Weatherill,
Sharlow J. refers to a “review” giving rise to report #1, even though it is a
report by the Auditor General. She describes the process that led to report #2 without
using a generic term to describe the decision-making process.
[177]
I use the
term “inquiry” [“enquête”], relying on the definition given in Le Petit
Robert, 1992, “enquête”:
[TRANSLATION]
. . Public Law. Administrative
inquiry, procedure through which the administration gathers information, verifies
certain facts, before making a decision …
An inquiry suggests a degree of autonomy in researching information,
which is not necessarily the case with a review [“examen”] (Le Petit Robert,
1992, “examen”):
[TRANSLATION]
Consider. Study
carefully.
[178]
With
respect to the term “personalized” used to describe the inquiry, it means that
the inquiry leading to the removal must contemplate the person(s) facing the
removal procedure. This does not exclude the possibility that several persons
be contemplated by the same personalized inquiry, as long as the inquiry targets
the individual actions of each of these persons and they have the right to a
personalized response. The inquiry must, in short, make it possible to shed
light on the specific conduct of the person affected.
[179]
The choice
that I made to use the expression “personalized inquiry” is based in part on
the nature of the proceeding that must be followed. In my opinion, it would be
wrong to say that the Governor in Council was only bound to conduct a simple
review regarding the applicant’s conduct, considering the complexity of the
matter. The procedure followed in Wedge and Weatherill was not a
simple review. Instead, an independent investigation of the facts was carried
out by the decision-maker, and that investigation was personalized. On the
other hand, my choice to use the expression “personalized inquiry” is based on
the respondent’s own choice of vocabulary. On several occasions the respondent
uses the term [TRANSLATION]”inquiry” [“enquête”] in his memorandum,
which confirms that it is an appropriate expression in the circumstances
(respondent’s memorandum, paragraphs 70 and 85 to 88).
(c) The
nature of the duties performed: the Governor in Council can be somewhat
predisposed in factual situations in the context of an employer-employee
relationship
[180]
The
applicant considers that because several branches of the Canadian government
were apparently involved in Beaudoin v. Banque de développement du Canada, above, (Auditor General of Canada, Prime Minister’s Office,
Privy Council Office, Minister of Industry), he should have been entitled to be
heard by an independent and impartial decision-maker. The applicant does not state
what forum, other than the Judicial Council, could offer him the same safeguards.
[181]
The
respondent submits for his part that in certain cases, necessity must prevail
over the requirements of natural justice. In other words, the respondent believes
that the Governor in Council was the only forum authorized to decide by law, and
that the implication of certain branches of the government in Beaudoin v.
Banque de développement du Canada, above, would not prevent her from
exercising her power of removal. Further, he is of the opinion that it was normal
that the Minister of Industry and the Governor in Council were not absolutely impartial
considering the circumstances. In labour law, says the respondent, it is normal
that the employer who has been advised of the employee’s conduct would have an
opinion since it was precisely for that reason that the disciplinary process
was initiated.
[182]
According
to the Supreme Court, the duty of impartiality may vary in order to reflect the
context of a decision-maker’s activities and the nature of its functions (Imperial
Oil Ltd. v. Quebec (Minister of the Environment), [2003] 2 S.C.R. 624,
at paragraph 31). In the context of an employer-employee relationship, it
is normal that the decision-maker would be predisposed even before offering the
employee an opportunity to respond to the reasons for dissatisfaction. This
does not mean, however, that the decision-maker is unable to make a clear and
enlightened decision. In fact, this predisposition is the starting point of the
entire procedure, and the Supreme Court implicitly recognizes this in Knight v. Indian Head School Div.
No. 19,
at page 680, when it writes:
The purpose
of those two procedural safeguards are, however, inherently different. The duty
to act fairly aims at insuring that the procedure followed by the appellant
Board in reaching its decision to terminate the respondent’s employment was
fair to the respondent, i.e., that it gave him the opportunity to try and change
the appellant Board’s mind.
[Emphasis
added.]
However, the employer who is predisposed must offer the
employee a real opportunity to contest the merits of the allegations and the employer
must take the employee’s position into account before making the final decision.
[183]
In this
case, it was entirely normal that the Governor in Council would be somewhat
predisposed in regard to the applicant, as a result of the nature of the procedure.
There is therefore no need to recognize that the applicant is entitled to a
decision-maker free of any predisposition. The predisposition of the
decision-maker in this case is explained by the nature of the duties performed
and to me does not appear to breach the applicant’s rights.
[184]
The applicant
pointed out that his suspension without pay establishes a clear predisposition on
the part of the decision-maker, going beyond the predisposition resulting from
the nature of the procedure. He contends that a suspension without pay is
exceptional (Cabiakman v. Industrial Alliance Life Insurance Co., [2004]
3 S.C.R. 195, at paragraphs 60 to 72). Although I share the applicant’s
opinion on this point, I do not think that this preliminary sanction should be
interpreted as a sign of bias so significant that it would compromise the
decision-maker’s ability to make a decision in what concerns the applicant’s
rights.
(d) The
right to fair play and transparency
[185]
Even if
the Governor in Council is not bound to a duty of impartiality in the context
of an employer-employee relationship, she is nonetheless bound to an obligation
of play fair, of transparency. This is inherent to the very idea of natural
justice (Baker
v. Canada (Minister of
Citizenship and Immigration), above, at page 849; Knight
v. Indian Head School Div. No. 19, above, at page 682).
The evidence indicates that these obligations were not observed and that the
procedure followed was not consistent with the “high standard of justice” referred
to by Dickson J. in Kane v. Board of Governors of the University of British
Columbia, above, at page 1106. In my opinion, three elements show that the
decision-maker had an inappropriate attitude, inconsistent with transparency
and fair play. These elements may appear to be of minor importance, but I
believe that in this case it is symptomatic of the flawed procedure.
[186]
First,
the evidence establishes that, at all times, it was the applicant who was
demanding that the procedural safeguards be observed, while the decision-maker
should have taken it upon herself to offer these safeguards to the applicant
and explain the decisional framework to him. It was not until after the
applicant sent a letter to the Prime Minister that he was offered, in the
letter dated February 24, 2004, the opportunity to assert in writing
his right to respond to the reasons for dissatisfaction. Moreover, the Minister
of Industry did not offer to meet with the applicant, instead the applicant had
to request that a meeting be held. One wonders whether the applicant would have
had the chance to meet with the Minister of Industry if he had not requested it.
It seems to me that if the Governor in Council is the master of her procedure, it
is her responsibility to put it into operation and not the applicant’s
responsibility to beg for it. This is at least the approach that was observed
in Wedge and Weatherill, above. That alone is not necessarily
fatal, but could be an element that is inconsistent with fair play and
transparency.
[187]
Second,
it seems to me that when the rules of procedure are unknown by the person bound
by them, they can hardly be qualified as transparent. Thus, the applicant was
unaware of the burden imposed on him by the Governor in Council, as I explain
below (see paragraphs 208 to 212 of this decision).
[188]
The
third element involves the letters sent by the applicant dated March 4 and
March 10, 2004. These included the letter in which Mr. Vennat
expressed his concerns after reading the article in the newspaper La Presse, and the
letter asking that the procedure of section 69 of the Judges Act be
followed. These letters went unanswered whereas Mr. Vennat was duly making
requests in what concerns the decision-making process. There was nothing to
prevent the Minister of Industry or the Privy Council Office from responding to
these requests. The Privy Council Office could have, as in Weatherill
(paragraph 39 of the decision) told the applicant that it did not intend
to apply section 69 of the Judges Act. The Minister of Industry could
have reassured the applicant when the request was made. The only response
received by the applicant was the dismissal letter dated March 12, 2004.
[189]
The
attitude betrayed by the decision-maker’s acts and omissions in this case is
not analogous to the work of the Governor in Council’s delegates in Wedge
and Weatherill, above. In Wedge,
Ms. Bloodworth made the initiative to contact the affected party to alert
him to the reasons for dissatisfaction. The reports were sent diligently. In Weatherill,
it seems that the conduct of Ms. Jauvin and the Privy Council Office personnel
was exemplary, based on the Sharlow J.’s description of it. Mr. Weatherill
was even offered the opportunity to meet with the representatives of the
Auditor General, the agency that prepared the report about him. The exchanges
between Ms. Jauvin and Mr. Weatherill’s counsel, Mr. Hefferson,
were prompt. Ms. Jauvin responded diligently to his letters. Additional
time was given when requested. Mr. Weatherill had even been advised that
the process would follow its course after his motion for an interim injunction
was dismissed. It does not appear to me that this kind of diligent,
professional conduct was observed in regard to Mr. Vennat.
[190]
To summarize,
it is my opinion that the Governor in Council did not deal with the applicant in
a transparent manner, in accordance with fair play.
B. Analysis of the procedural
safeguards according to Knight
[191]
Aside from
the above-mentioned procedural safeguards, the applicant was also entitled to
the procedural safeguards recognized in Knight v. Indian Head School Div.
No. 19, above, at page 683,
as the respondent admits:
. . . [T]he
Saskatchewan Court of Appeal found that the basic requirements of the duty to
act fairly are the giving of reasons for the dismissal and a hearing, adding
that the content will vary according to the circumstances of each case. . . notice
of the reasons for the appellant Board’s dissatisfaction with the respondent’s
employment and affording him an opportunity to be heard would be sufficient . .
.
[192]
The case
law has consistently regarded these procedural safeguards as a minimum (see Cardinal v. Kent
Institution, [1985] 2 S.C.R. 643, at paragraph 22; Nicholson v.
Haldimand-Norfolk (Regional) Police Commissioners, [1979] 1 S.C.R. 311, at
paragraph 27; Reglin v. Creston (Town), [2004] B.C.J. No. 1218 (B.C.S.C.),
at paragraphs 43 and 46; Woodley v. Yellowknife Education District No.
1, 2000 NWTSC 30 (N.W.T.S.C.), au paragraph 22; Charles v.
Université de Montréal, (February 14, 1990), Montréal, 500-05-012566-897 (Qc.
Sup. Ct.), at pages 18 and 20).
[193]
I shall
address in the following paragraphs the issue of whether the safeguards were
observed in regard to the applicant.
(1) The
right to be informed of the reasons for the employer’s dissatisfaction
[194]
The
applicant was informed of the reasons for the Governor in Council’s
dissatisfaction in a letter dated February 26, 2004, which was in response to
the applicant’s request for particulars dated February 25, 2004. These reasons
had two components (personal and corporate), as I mentioned earlier (see
paragraph 21 of this decision).
[195]
These
reasons could certainly have been more specific, but I do not believe that it
amounted to a breach of the duty to act fairly. The letter dated February 26,
2004, refers to several specific paragraphs of the decision in Beaudoin v.
Banque de développement du Canada, above. The applicant could have prepared
a list of the allegations against him based on that letter and meaningfully responded
to them. In this case, all of the exchanges between the parties, the applicant’s
experience and his prior knowledge of part of the facts of the decision in Beaudoin
v. Banque de développement du Canada, above, are circumstances that suggest
to me that he had sufficient knowledge of the grounds for the allegations to make
meaningful submissions to the Governor in Council and her representative.
[196]
The
applicant was aware of the substance of the reasons for the allegations (Weatherill v. Canada (Attorney General), above, at
paragraph 94), and that is all that is required by the duty to act fairly
since the duty to act fairly does not seek to achieve “procedural perfection” (Knight
v. Indian
Head School Div.
No. 19,
above, at page 685).
(2) The
applicant’s right to respond was only observed in part
[197]
In
this case, the applicant responded to the reasons for dissatisfaction in
several different ways:
1.
He submitted the letter dated March 1, 2004, containing part of his
version of the facts;
2. A
preliminary memorandum of approximately 30 pages was given to the Minister of
Industry on March 1, 2004;
3. He had
the opportunity to meet with the Minister of Industry for about two hours according
to both parties, with the Clerk of the Privy Council and Pierre Legault, general
in-house counsel at the Department of Industry;
4. He sent
to the Minister of Industry the letter dated March 2, 2004, with several additional
documents attached thereto;
[198]
The
respondent emphasized the fact that in the letter dated March 4, 2004, the applicant’s
counsel recognized that the Minister of Industry had, in his view, an open mind.
According to the respondent, it was an admission that established that the
applicant’s right to respond had been observed. In my opinion, whether or not the applicant and
his counsel wrote or believed that the decision-maker had an open mind does not
suggest that the decision-maker did in fact have an open mind or that the applicant’s
right to respond had been respected.
[199]
Several
factors lead me to believe that, to the contrary, the applicant’s right to
respond was not truly observed, including the duration of the meeting of March
1, 2004, the very short period of time that the applicant had to prepare for it,
Mr. Ritchie’s absence from this meeting and the standard applied. I will now
address each of these factors.
(a)
The duration of the meeting and failure to conduct a personalized
inquiry
[200]
First,
as a reminder, the meeting attended by the applicant was about two hours long, as
the counsel of both parties agreed. The duration of the meeting in itself is
certainly not problematic, since like a pleading, such a meeting should not
serve to repeat what has been submitted to the decision-maker in writing. It
should serve to respond to the decision-maker’s questions, to draw his or her
attention to the important details and to set out in general the point of view
of the affected party. However, in the absence of a personalized inquiry (see
paragraphs 165 to 174 of this decision), I do not believe that the applicant could
have meaningfully responded to the reasons for dissatisfaction considering the
complexity of the matter (see paragraph 169 of this decision).
(b)
The timeframe for the decision making process was very brief
[201]
Further,
the applicant only had a relatively brief period of time to prepare his
submissions. In fact,
Mr. Vennat had to make his written and oral submissions within a period of one
week (at
the most eight days, namely from February 24 to March 2, 2004, therefore only six
business days). As an
example, in Wedge,
Ms. Bloodworth’s involvement in the inquiry was spread out over several
months (from the beginning of May 1994 to mid-September1994), and Mr. Wedge
had additional time to make his written submissions (until October 6, 1994). In
Weatherill, Ms. Jauvin had been involved for about 20 days (December
2, 1997 to December 24, 1997) and Mr. Weatherill had more than a month of
additional time to submit his version of the facts (until January 28, 1998).
[202]
The
fact that the Minister of Industry’s time-frame was limited does not in itself
amount to a breach of the duty to act fairly. As the respondent pointed out,
the applicant’s counsel stated in his letter dated March 2, 2004, that he had
had the opportunity to [TRANSLATION]
“set out the reasons why there was no valid reason to end Michel Vennat’s
mandate as President and Chief Executive Officer of the BDC”. It was normal, in
that context, that the Minister would then move to the decision-making phase.
[203]
However,
the relatively brief period of time that the applicant had is relevant in
assessing the quality of the applicant’s right to respond, taking into account
the complexity of the matter (see paragraph 169 of this decision). To respond meaningfully to
the employer’s reasons for dissatisfaction, the applicant and his counsel
should have had a very detailed knowledge of the facts surrounding the hearing
in Beaudoin v. Banque de développement du Canada, above. Yet, the
applicant was simply a witness in that matter, and even if he had been familiar
with the many facts of the judgment, he could not have detailed knowledge of
the direct and indirect remarks made by Denis J. regarding him and the evidence
on which these remarks were based.
[204]
Even
though the applicant and his counsel were successful in doing quality work
despite the very tight time constraints, I do not think that it would be fair
to penalize the applicant because he made an effort to observe the very strict
requirements imposed by the decision-maker. The applicant’s counsel pointed out
in his letter dated March 2, 2004, that he went to the [TRANSLATION] “bottom line” in his
submissions, given the complexity of the matter. The same caveat is made in his
letter dated February 29, 2004. It seems that the applicant always wanted to
make detailed submissions but gave up when the Minister of Industry told him
that she did not want the transcripts of hearing in Beaudoin v. Banque de développement
du Canada, above. That is understandable because at the time Mr. Vennat
was in a vulnerable and subordinate position.
[205]
In short,
without faulting the Minister of Industry for not having granted an additional
period of time to the applicant (he had not formally requested it and he said
in his letter of March 2, 2004, that the Minister had given him the [TRANSLATION] “time necessary”), I must bear in mind that the applicant had
a very brief period of time to respond. I have already compared the applicant’s
situation with the situation of the affected parties in Weatherill and Wedge
above, and I consider that these comparisons are relevant in assessing the
period of time given to the applicant. The respondent claimed at the hearing
that the suspension without pay created a situation of urgency and therefore it
was necessary to proceed in an expedient manner. In my opinion, it would be
unjust to allow the Governor in Council to limit the applicant’s right to
respond on the basis that the situation is one of urgency, a situation she
herself created.
(c) The
absence of Mr. Ritchie
[206]
The
applicant wanted Mr. Ritchie to be present at the meeting of March 1, 2004, as
he had requested in his letter to the Prime Minister (applicant’s affidavit,
paragraphs 54 and 55; respondent’s memorandum, paragraph 83). In my opinion,
that request was entirely legitimate considering the corporate component of the
reasons for dissatisfaction (see paragraph 21 of this decision), the Board of
Directors’ decision not to appeal the judgment and the Board of Directors’
unanimous confidence in Mr. Vennat voiced in the press release dated February
18, 2004. In fact, under subsection 7(1) of the BDC Act, it is the Board
of Directors that manages the matters of the Corporation:
|
7.
(1) The Board shall direct and manage the business and affairs of the Bank.
|
7.
(1) Le conseil dirige et gère les affaires tant commerciales qu’internes de
la Banque.
|
[207]
Mr.
Ritchie was not the Chairperson of the BDC’s Board of Directors at the time
when the facts alleged against the applicant took place. However, the Board of
Directors reiterated its confidence in Mr. Vennat and it would have been expected
that Mr. Ritchie would explain before the Minister of Industry why the Board of
Directors acted in such a way, despite the seriousness of the judge’s remarks
in regard to Mr. Vennat in Beaudoin v. Banque de développement du Canada, above.
It seems to me that for the purposes of the personalized inquiry, it would have
been important to have Mr. Ritchie’s point of view before making a final
decision regarding Mr. Vennat, especially if the decision-maker intended
to accept the corporate allegations against the applicant. Without making it a
procedural requirement, I believe that it is a factor worthy of note in
assessing the quality of the applicant’s right to respond.
(d) The
standard applied
[208]
Finally
the standard applied by the Governor in Council was not the proper one.
[209]
At
paragraph 140 of his memorandum, the respondent explains that the applicant had
to submit very strong evidence in order to change the Governor in Council’s
opinion:
[TRANSLATION]
[140] It was
also not patently unreasonable for the Governor in Council to determine that
the remarks in the Denis judgment regarding the applicant’s conduct were
fatally incorrect, tainted by fraud or dishonesty; or that they brought new
evidence that had not previously been available to Denis J. in regard to the
actions of the applicant or the BDC.
[210]
As the
respondent acknowledged at the hearing, this standard is drawn from Toronto
(City) v. Canadian Union of Public Employees
(C.U.P.E.), above, at paragraph 52, where the
judge is discussing the application of the doctrine of abuse of process to
prevent the relitigation of determinations made against a person in an earlier
proceeding:
. . . It is
therefore apparent that from the system’s point of view, relitigation carries
serious detrimental effects and should be avoided unless the circumstances
dictate that relitigation is in fact necessary to enhance the credibility and
the effectiveness of the adjudicative process as a whole. There may be
instances where relitigation will enhance, rather than impeach, the integrity
of the judicial system, for example: (1) when the first proceeding is
tainted by fraud or dishonesty; (2) when fresh, new evidence, previously
unavailable, conclusively impeaches the original results; or (3) when
fairness dictates that the original result should not be binding in the new
context. This was stated unequivocally by this Court in Danyluk, above,
at paragraph 80.
[Emphasis
added.]
Paragraph 87 of the respondent’s memorandum confirms that
the Governor in Council applied a very strict standard in regard to the applicant:
[TRANSLATION]
[87] She [the
Governor in Council] did not have to act as a Court of Appeal, or to revisit the
three months of hearing preceding the Denis judgment. She could receive and
consider the remarks in the Denis judgment regarding the conduct of the applicant
and the BDC and determine, in light of the applicant’s explanations, whether
the Denis judgment remarks relating to the applicant’s conduct were so
unfounded that, despite the remarks:
(a) she could
continue to have confidence in the applicant; and
(b) she could
determine that the applicant’s conduct was compatible with his continued
appointment;
[Emphasis
added.]
Paragraph 80 of the respondent’s memorandum appears to
contradict paragraphs 87 and 140 but confirms that the standard applied was
very strict. The relevant passage of paragraph 80 reads as follows:
[TRANSLATION]
[80] The
aim of the exercise was not to establish that the Denis judgment was incorrect
and patently unreasonable. That letter informed the applicant that his conduct,
as related in the Denis Judgment, raised serious questions regarding whether there
were valid grounds to remove him and that his version of the facts was
wanted before the decision was finalized.
[Emphasis
added.]
However, the respondent said at the hearing that the
standard applied was the standard in Toronto (City) v. Canadian Union of
Public Employees (C.U.P.E.), above, confirming at the same time that a very
strict standard was applied in regard to Mr. Vennat.
[211]
In my
opinion, the standard in Toronto (City) v. Canadian Union of Public Employees
(C.U.P.E.), above,
does not apply in this case.
It is only appropriate when it is a matter of relitigating a decision in a new
forum. For the reasons mentioned earlier, the remarks of the judge in Beaudoin
v. Banque de développement du Canada, above, could not be set up legally against
the applicant (see paragraphs 138 to 144 of this decision). Mr. Vennat,
contrary to the party in Toronto (City) v. Canadian Union of Public Employees
(C.U.P.E.), above, was not charged or found
guilty in a criminal proceeding. It was a fatal error in law to impose on the
applicant a burden of proof practically impossible to rebut based on a precedent
in the case law which does not apply. Further, there is nothing in the record
to indicate that the applicant was aware of the burden placed on him: that is an
additional factor establishing that the procedure applied was not of the
required transparency. In this context, it seems to me that the applicant’s
right to respond was certainly strongly affected, as well as his ability to
change the employer’s mind.
[212]
To summarize,
the duty to act fairly certainly obliged the Governor in Council to give the applicant
a real opportunity to respond to the reasons for dissatisfaction, and not only
a right to a limited response against very elaborate allegations which could not
be refuted without relying on a careful analysis of volumes of evidence. Further,
the burden applied in regard to the applicant was incorrect, which amounts to a
serious error vitiating the entire procedure.
C. Finding as to the
Governor in Council’s duty to act fairly
[213]
As the Attorney
General acknowledged, the Governor in Council had the duty to act fairly in
regard to the applicant. The substance of that duty must be appreciated in
accordance with the nature of the decision and the applicable legislative
regime, the importance of the decision for the applicant and his legitimate
expectations, all the while taking into account the procedural choices made by
the Governor in Council.
[214]
This
approach led me to observe, first, that the removal of the President and Chief
Executive Officer of the BDC must be effected in a framework that need not be
judicial or formalistic. The Governor in Council is master of the procedure as
a general rule. Further, my analysis enabled me to ascertain that the removal of
the President and Chief Executive Officer of the BDC, in the particular
circumstances of this case, was subject to a series of enhanced procedural
safeguards.
[215]
The
applicable procedural safeguards are the following. First, the applicant was
entitled to the safeguards recognized in Knight v. Indian Head School Div.
No. 19,
above, at page
683, namely the right to know the reason(s) for dissatisfaction as well as the
right to respond to the reasons for dissatisfaction. These safeguards are the
most basic form of the duty to act fairly. Further, my analysis led me to find
that the applicant was entitled to enhanced procedural safeguards, namely, the
right to a personalized inquiry into the facts by the decision-maker and the
right to respond as well as the right to a decision with sufficient reasons. On
a broader scale, I believe that the applicant was entitled to participate in a
transparent forum and to deal with a decision-maker who played fair.
[216]
Finally,
my analysis of the evidence indicated to me that some of the procedural
safeguards had not been observed as regards the applicant. That applies to the obligation
to conduct a personalized inquiry, the right to have a true opportunity to
respond to that inquiry and the right to a decision with sufficient reasons. Further,
it appeared to me in light of the evidence that the applicant only had a very limited
right to respond to the reasons for dissatisfaction. Another significant
element vitiating the procedure was the application of too onerous a burden
drawn from a Supreme Court decision that did not apply in the circumstances. The
Governor in Council required that Mr. Vennat establish that the remarks of
the judge in Beaudoin v. Banque de développement du Canada, above, were fatally incorrect, tainted by fraud
or dishonesty; or that he bring forth new evidence that had not previously been
available to the judge. That burden was certainly not appropriate and was
not known by Mr. Vennat. It was therefore not possible for Mr. Vennat to reverse
the simple presumption of facts that rested on him as a result of the decision
in Beaudoin v. Banque de développement du Canada, above.
VIII. Analysis – Principal
application– Substantive issues
[217]
Considering
the failures to observe procedural fairness that I identified, there is no need
to respond to questions 3(a) and 3(b) (see paragraph 6 of this decision), since
these issues relate to the merits of the Governor in Council’s decision.
IX. The costs
[218]
Considering
my answers to the questions at issue, costs are awarded to the applicant. The
applicant is seeking costs on a solicitor-client basis but did not establish or
submit convincing evidence of reprehensible conduct on the part of Governor in
Council, her representatives or her counsel to justify such an exceptional measure
(Mackin v. New
Brunswick
(Department of Finance),
[2002] 1 S.C.R. 405, at paragraph 86).
[219]
Bearing in
mind the discretion that I have under section 400 of the Rules (in particular paragraphs
(3)(c) and (3)(g)), I award costs in accordance with the highest number
of units provided in Column IV of the Tariff B.
X. Conclusion
[220]
This
decision does not bear on the issue of whether the applicant’s removal was justified.
It does not in any way challenge the legal validity of the decision in Beaudoin
v. Banque de développement du Canada, above. It does not make any
determination regarding the applicant’s conduct, either at the hearing in the
case cited or in the performance of his duties as President and Chief Executive
Officer of the BDC. The decision does not address the BDC’s administration
of any specific matter, or the merits of the final decision by Denis J. in Beaudoin
v. Banque de développement du Canada, above. The scope of this decision
is limited: it is only a matter of defining and applying the duty to act fairly
in regard to the applicant.
[221] In short, it is my opinion
that the applicant was not treated fairly considering all of the circumstances and the applicable case law. The President and Chief Executive
Officer of the BDC must be relatively independent so that he or she is able to
act in the public interest. The procedural framework which permits such
independence to be achieved was not observed in regard to the applicant. In fact, the applicant was
not given the right to meaningfully respond to the reasons for dissatisfaction of
the Governor in Council, or the right to be the subject of a personalized
inquiry and to respond to the result of that inquiry. Moreover, the decision regarding
him was not sufficiently reasoned. The duty to act fairly requires, in an
employee-employer relationship, a high standard of justice and the observance
of transparency and fair play. It is the sum of the factors – not any of them
taken in isolation – that are mentioned in this decision that have led me to determine
that the duty to act fairly was not observed in regard to the applicant. I do
not see how I could determine otherwise, considering all of the circumstances.
[222]
I
attempted to adopt a clear and systematic analysis and application of the duty
to act fairly, while remaining within the guidelines established by the case
law. I was careful to consider all of the relevant circumstances. I must say
that despite that effort, this decision was very complex because of the lack of
statutory, regulatory and quasi-regulatory guidelines addressing the removal of
public office holders. In the absence of more solid, certain and foreseeable
points of reference, I had to apply on the case law.
[223]
There is a
risk that similar situations will arise again in the future and the absence of
guidelines makes the law less foreseeable, efficient and certain.
JUDGMENT
THE COURT ORDERS:
- The
respondent’s motion to strike is allowed in part. Documents MV-22, MV-30, MV-31
and MV-33, as well as the affidavit of Denis Désautels, are struck from the
record;
- The
paragraphs of the applicant’s affidavit listed in Appendices A, B and C are
struck (except for the specified passages);
- The applicant’s
motion to strike is allowed in part;
- The application
for judicial review is allowed;
- The Governor
in Council’s Orders dated February 24, 2004 and March 12, 2004 (bearing numbers
P.C. 2004-225 and P.C. 2004-147) are quashed and the matter is
referred back to the Governor in Council;
- The
applicant is awarded costs in accordance with the highest number of units
provided in Column IV of the Tariff B.
“Simon
Noël”
Certified true translation
Kelley A. Harvey, BCL, LLB
Appendix A
Paragraphs of the applicant’s affidavit which
are ordered to be struck on the ground that they are related to the affidavit of
Denis Désautels or to Exhibits MV-22, MV-30, MV-31,
MV-33:
- 102(g),
107, 108, 110, 115, 135, 136, 137, 141, 142, 146, 155, 157, 158, 164 (with the
exception of paragraph (b),which is incorporated into Exhibit MV-15, page 12),
165, 171, 177, 183, 214, 218 (a) and (d), 252, 253, 256, 257, 258, 261, 267,
270, 272 to 274, 285, 286, 288, 289, 294, 297, 299, 300, 307, 310 (with the
exception of the passage from the judgment), 313, 315 to 320 (with the
exception of the passage from the judgment), 321, 322, 324, 327, 329 and 339 to 343.
Appendix B
Paragraphs of the applicant’s affidavit
which are ordered to be struck on the ground that they contain information which
was not or could not have been before the decision-maker at the time the
decision was made:
- 102b),
(c), (d), (e) and (f), 113, 118, 119, 122, 156, 160, 173, 177, 188, 210, 216,
217, 235 (ii) and (iii);
- Paragraphs
245 to 347 are also struck to the extent that they have not already been struck
in Appendix A. I note that the applicant admits at paragraph 247 of his
affidavit that this part of his argument (paragraphs 245 to 347) was not
before the Governor in Council considering the limited time given to him. However,
the parts of the paragraphs containing passages from the judgment are not
struck (as an example, paragraphs 310, 312, 326, etc.).
Appendix C
Paragraphs of the applicant’s affidavit
which are ordered to be struck on the ground that they contain allegations of
law, opinion or commentary regarding evidence that is self-explanatory:
- 20,
21, 22, 23, 24, 26, 34, 44 (except to note that the applicant said he had four working
days to prepare and submit his preliminary memorandum), 45, 52, 64, 66, 68, 72 to
76, 78, 79, 80 to 84, 87 (except the passage from the judgment), 88, 89, 100,
101, 103, 120, 128, 133, 138, 139, 152, 161, 170, 174, 178, 190, 200, 212, 219,
220, 221, 222, 239, 244, 348, 349, 351 to 353, 355, 356, 358, 359, 361 to 364.
FEDERAL COURT
SOLICITORS OF RECORD
DOCKET: T-611-04
STYLE OF CAUSE: Michel
Vennat v. AGC
PLACE OF
HEARING: Montréal
DATE OF
HEARING: June
27 and 28, 2006, and July 4 and 5, 2006
REASONS FOR JUDGMENT: The Honourable Mr. Justice Simon Noël
DATED: August 24,
2006
APPEARANCES:
|
Louis P.
Bélanger
Patrick Girard
Nathalie
Mercier-Filteau
|
FOR THE APPLICANT(S)
|
|
Martine
Tremblay
Alexandre
Brousseau-Wery
|
FOR THE RESPONDENT(S)
|
SOLICITORS
OF RECORD:
|
Louis P.
Bélanger
Patrick Girard
Nathalie
Mercier-Filteau
|
FOR THE APPLICANT(S)
|
|
Martine Tremblay
Alexandre
Brousseau-Wery
|
FOR THE RESPONDENT(S)
|
|
Georges J.
Pollack*
|
FOR THE PRIVY
COUNCIL OFFICE
|
|
* Mr. Pollack
was only present for half a day, the morning of the 27th.
|
|
|
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