Date: 20061102
Docket: T-1708-05
Citation: 2006 FC 1326
Ottawa, Ontario, November 2,
2006
PRESENT: The Honourable Mr. Justice Barnes
BETWEEN:
ATTORNEY
GENERAL OF CANADA
Applicant(s)
and
GOVERNMENT OF YUKON
(WHITEHORSE INTERNATIONAL AIRPORT)
Respondent(s)
REASONS FOR JUDGMENT AND JUDGMENT
[1]
The
Whitehorse International Airport (WIA) is owned and operated by the Yukon
Government. The Government of Canada, through Transport Canada, is
responsible for regulating aviation security in Canada, including
the safety and certification of airports. It carries out that responsibility
through the enforcement of the Aeronautics Act (Act), R.S., 1985,
c. A-2 and related Regulations. The WIA is a facility named by the Minister of
Transport (Minister) in a Civil Aviation Airport Certificate issued on January
5, 2001 authorizing the Yukon Government, through its Department of Highways
and Public Works, to operate the airport.
[2]
It
is undisputed that the WIA is not a legal entity and that only the named
operator of the airport (ie. the Yukon Government) and its servants and agents
are subject to the security obligations created by the Act and Regulations.
However, on April 14, 2004 the Minister issued four Notices of Assessment of
Monetary Penalty (Notices) under section 7.7 of the Act against the WIA
totalling $7,500.00. Those Notices named the WIA as a party which had
contravened certain stipulated airport security measures, including a failure
to obtain security clearances for two individuals who had been issued airport
restricted area passes.
[3]
The
Yukon Government challenged the Minister’s Notices before the Transportation
Appeal Tribunal of Canada (Tribunal). At no time did the Yukon Government take
issue with the Minister’s determinations of responsibility on the merits. The Yukon
Government argued, instead, that by incorrectly naming the WIA as a legal
person or entity subject to regulatory control, the Minister’s Notices were
legal nullities which could not be saved by amendment. Nevertheless, the
Tribunal allowed the Minister’s motion to amend the Notices to add the Yukon
Government as a party. Because the Yukon Government did not mount a
substantive defence to the Minister’s case against it, the contraventions were
confirmed by the Tribunal in a decision rendered on April 6, 2005.
[4]
The
Yukon Government challenged the Tribunal’s ruling by way of an appeal to a
three-member panel of the Tribunal (Appeal Panel). That appeal was allowed on
two grounds:
1. that
the Notices of Assessment were legal nullities which could not be cured by an
amendment; and
2. that
the Yukon Government was prejudiced by having to proceed through a hearing on
the merits before knowing whether it was a party to the proceeding.
It is from the above appeal determinations
that the Minister seeks relief.
The Tribunal Decision
[5]
The
Tribunal was faced with several preliminary motions which it chose to decide in
its final decision after hearing all of the evidence.
[6]
The
Yukon Government brought two preliminary motions. The first of these was a
motion to compel the Minister to disclose evidence “that the Whitehorse
International Airport is a legal person subject to Ministerial
Penalties”. Its second and related motion was to have the case against the WIA
summarily dismissed because it was not a legal person subject to the imposition
of a penalty. In the face of these motions, the Minister asked the Tribunal to
amend the Notices to add the Yukon Government as the party named.
[7]
Although
counsel for the Yukon Government repeatedly asked the Tribunal to rule on its
motions before hearing evidence and rendering its final decision, the Tribunal
declined to do so. This was not altogether surprising because counsel for the
Yukon Government stated on the record on four separate occasions that his client
did not intend to contest the merits of the case and was prepared to admit the
essential facts of the Minister’s allegations.
Appeal Panel Decision
[8]
The
Appeal Panel held that the Tribunal had exceeded its jurisdiction by allowing
an amendment to the Notices. It concluded, on the strength of Regina v. AFC
Soccer, [2004] M.J. No. 194, 2004 MBCA 73, that the Notices were legal
nullities because the proper identification of the party named was a material
averment. On that basis, it distinguished its own decisions in Canada
(Minister of Transport) v. Fosberg, [1988] C.A.T.D. No. 35 and in Matiushyk
v. Canada (Minister of
Transport),
[1994] C.A.T.D. No. 7 where amendments, respectively to a Notice of Assessment
of Monetary Penalty and to a Notice of Suspension, had been allowed.
[9]
The
Appeal Panel also ruled that the Tribunal had breached the rules of natural
justice by requiring the Yukon Government to go through the proceeding on the
merits without knowing whether it was a party. Its conclusion on that point is
set out in the following brief passages:
The identity of the “person” believed to
have contravened a provision was not established until after the hearing was
concluded. The identity of the “person” was put in issue by both the applicant
and respondent. Neither motion was answered prior to or during the hearing.
The answer only came with the issuance of the determination some months after
the hearing when the Tribunal granted the motion to amend and made no mention
of the applicant’s motion.
The result is that the applicant was
forced to go through the proceeding without knowing if he was a party.
Prejudice results. The applicant is forced to go through the evidentiary portion
of the proceeding still not sure if he is a party. How can that be done
effectively? We think that to be a breach of natural justice.
Both motions were made pursuant to Rule
10. That Rule does not impose a time constraint on the Tribunal to reply to a
motion. Many situations are amenable to hearing or considering the motion and
replying to it later in the proceeding or in the determination. However, the
determination of the identity of the party to the proceeding must be done early
enough to allow the effective participation of the party. Here we think that it
was essential for the ruling(s) to be made at the outset and certainly before
the calling of the Minister’s case.
Statutory Framework
[10]
To
properly address the jurisdictional ruling made by the Appeal Panel by which
the Notices were declared to be legal nullities and thus not subject to
amendment, it is useful to examine the regulatory process by which these matters
were adjudicated.
[11]
The
Act authorizes the Governor in Council to enact Regulations in which certain
statutory provisions are designated for enforcement by means of an
administrative penalty and not by way of summary prosecution. Although the contravention
of these designated provisions is, by section 7.6(2) of the Act, deemed to be
an offence, the stipulated enforcement procedure is not in the nature of a
prosecution. Instead, the Act permits the Minister, on reasonable and probable
grounds, to assess a monetary penalty against a person or corporation for an
alleged contravention. The Designated Provisions Regulations, S.O.R./2000-112
establish maximum penalty amounts and in no case can the penalty exceed
$5,000.00 for an individual or $25,000.00 for a corporation.
[12]
Written
notice of the Minister’s decision is required to be given to the person or
corporation named. That notice must include the identification of the
designated provision believed to have been contravened and the amount of
penalty to be paid in settlement. The person or corporation named has the
choice of either paying the penalty or requesting a review of the alleged
contravention or the amount of the penalty, or both. If the person or
corporation chooses the settlement option, section 7.9 of the Act bars any
further proceedings in respect of that contravention.
[13]
Where
the person or corporation named elects to have the alleged contravention or
penalty reviewed, a written request for review is required to be sent to the
Tribunal. In conducting a review hearing, the Tribunal must observe the rules
of procedural fairness and natural justice including the right of the parties
to present evidence and to make representations (see section 7.91(3) of the Act).
The Act also stipulates that the burden of proof in such a review rests with
the Minister and is on a balance of probabilities (see the Act at section
7.91(4) and also see Transportation Appeal Tribunal of Canada Act, S.C. 2001, c. 29, at section 15(5)).
[14]
The
parties are entitled to notice of the Tribunal’s findings and either of them
can appeal that determination to an appeal panel of the Tribunal. Where the
appeal panel allows the appeal, it may substitute its decision for the original
determination. (see section 7.2(3) of the Act.)
[15]
Under
section 15(1) of the Transportation Appeal Tribunal of Canada Act, the
Tribunal is not bound by any legal or technical rules of evidence and is
directed to deal with its cases as informally and expeditiously as the
circumstances and considerations of fairness and natural justice permit.
Nevertheless, the Tribunal’s Rules provide for testimony to be given under oath
with a right of examination and cross-examination. The Tribunal is also
required to render its determinations in writing including the determination of
applications brought before it. While the authority to adjourn a proceeding is
expressly granted by the Tribunal Rules, many other procedural matters are left
to be determined in accordance with Rule 4 which states:
|
Where
a procedural matter not provided for by the Act or by these Rules arises
during the course of any proceeding, the Tribunal may take any action it
considers necessary to enable it to settle the matter effectively, completely
and fairly.
|
Le
Tribunal peut prendre les mesures qu'il juge nécessaires pour trancher
efficacement, complètement et équitablement, au cours d'une instance, toute
question de procédure non prévue par la Loi ou les présentes règles.
|
[16]
The
federal legislative framework providing for the adjudication of many alleged
violations of aviation security measures was quite obviously designed as an
administrative and not as a prosecutorial process. While that process is
adversarial, it is also couched in language which discourages formality and
technicality. An adjudication is required to conform to the dictates of
fairness and natural justice, but otherwise the scheme avoids the more rigorous
procedural requirements commonly associated with criminal or quasi-criminal
prosecutions. It also imposes upper limits on the amount of penalty the
Minister can impose and uses a civil burden of proof. A Notice is a form of charging
document but it initiates an administrative process which can result in either
an acceptance of the Minister’s penalty or an administrative adjudication. In
short, the process is limited to the adjudication of certain stipulated
provisions, is controlled by monetary caps and is reserved to a Tribunal with
expertise in matters of aviation safety and security. It is also a process
controlled by principles of natural justice with a view to efficiency and a
reasonable degree of procedural informality.
Analysis
Standard of Review
[17]
The
Appeal Panel allowed the Yukon Government’s appeal by holding that the Tribunal
exceeded its jurisdiction by granting the amendments and that it breached the
rules of natural justice by failing to deal with the amendment and summary
dismissal motions in advance of hearing the case on the merits.
[18]
The
jurisdictional ruling was based on a point of law going to the root of the
Tribunal’s authority. As such, the standard of review for that part of the
Appeal Panel’s decision is correctness. This was accepted by both parties but,
in any event, I would adopt the analysis by Justice Eleanor Dawson on this
point in Canada (Attorney General) v. Woods, [2002] F.C.J. No. 1267;
2002 FCT 928, where she held at paragraphs 10 to 12 as follows:
10 Relying upon the decision of
Justice Tremblay-Lamer in Air Nunavut v. Canada (Minister of Transport),
[2001] 1 F.C. 138 (T.D.) and upon the pragmatic and functional approach, the
Minister says that the standard of review to be applied to the Appeal Panel's
decision on the jurisdiction of the Civil Aviation Tribunal to hear these
offences is correctness. Counsel for Mr. Woods agrees.
11 I am satisfied that by application
of the factors articulated in Pushpanathan v. Canada (Minister of Citizenship and
Immigration),
[1998] 1 S.C.R. 982, the standard of review is correctness. In particular, I
have considered the importance of the question and its applicability to
numerous future cases, and the relative lack of expertise of the Appeal Panel
on questions of statutory interpretation.
12 The Tribunal must make a correct
interpretation of the Act on this issue and so, in this sense, the question
goes to the jurisdiction of the Civil Aviation Tribunal. Therefore, the
question must be answered correctly in order for the Tribunal to be acting
intra vires. See: Pushpanathan, supra, at paragraph 28.
[19]
With
respect to the Appeal Panel’s procedural fairness ruling, no functional and
pragmatic assessment is required. The Appeal Panel was required to be correct
in its treatment of the Tribunal’s approach to the procedural motions. That is
so because there can only be one correct answer as to whether the Tribunal
breached the rules of natural justice by conducting itself as it did: see Ellis-Don
Ltd. v. Ontario (Labour Relations Board), [2001] S.C.J.
No. 5, [2001] 1 S.C.R. 221, 2001 SCC 4 at para. 65.
Did the Tribunal have
the authority to amend the Notices?
[20]
The
Tribunal has previously held that it has the authority to amend a charging
document. In Fosberg, above, an Appeal Panel of the Tribunal allowed an
amendment based on the following test:
Has the Respondent been reasonably
informed of the charge against him so that he has an opportunity to present a
full defence and obtain a fair trial. If the Respondent has not been misled,
the Tribunal ought to allow an application to amend and proceed with the
hearing. If on the other hand there is any possibility that the Respondent has
not been reasonably informed of the charge and may not be able to present a
full defence and obtain a fair trial, the Tribunal ought to allow an amendment
only if a sufficient adjournment is granted to enable the Respondent to prepare
a full and complete defence and obtain a fair trial.
To the same effect is the Tribunal’s
decision in Matiushyk, above, where it held:
I find that the amendment is technical,
and the Applicant has, in my view, not been misled or prejudiced in his defence
by the variance. In addition, having regard to the merits of the case, the
proposed amendment can be made without injustice being done. Further, Mr.
Matiushyk had ample opportunity to put forward arguments that he did not have a
reasonable time to present a full defence, and he presented none. I therefore
allow the amendment.
The above-noted passages clearly adopt the
administrative law standard for the giving of proper notice to a party subject
to regulatory sanction under the Act.
[21]
In
this case, however, the Appeal Panel found the common defect in the Notices to
be so fundamental that they could not be amended. In coming to that conclusion,
it relied upon the reasons given by the Manitoba Court of Appeal in AFC
Soccer, above. That case involved a Criminal Code indictment with a
similar defect. Although the AFC Soccer case did result in the Court
declaring the indictment to be a nullity, it is important to recognize that the
decision arose in the context of a criminal prosecution where the strict rules
of pleading have had a long and distinctive history. It is also of some
interest that the Court’s comments about the power to amend were obiter because
the accused had pleaded guilty and no request for an amendment had been
entertained.
[22]
In
the administrative law context, form ordinarily gives way to substance. In
that context, the obligation to give effective notice is driven by the ultimate
consideration of fairness and not by technical formalities. Even in the realm
of criminal and quasi-criminal proceedings, the historical justification for
quashing indictments and informations has been largely eroded. This point was
made by the Supreme Court of Canada in The Queen v. Sault Ste. Marie,
[1978] 2 S.C.R. 1299 at page 1307 in the following passage:
Each of these tests is helpful as far as
it goes, but each is too general to provide a clear demarcation in concrete
instances. This is shown by the variety of cases and the diversity of opinion
in this case itself. To resolve the matter one must recall, I think, the policy
basis of the rule against multiplicity and duplicity. The rule developed during
a period of extreme formality and technicality in the preferring of indictments
and laying of informations. It grew from the humane desire of judges to
alleviate the severity of the law in an age when many crimes were still
classified as felonies, for which the punishment was death by the gallows. The
slightest defect made an indictment a nullity. That age passed. Parliament has
made it abundantly clear in those sections of the Criminal Code having to do
with the form of indictments and informations that the punctilio of an earlier
age is no longer to bind us. We must look for substance and not petty
formalities.
[23]
In
Sault Ste. Marie, the Court went on to observe that in examining the
validity of a charging document, a court should consider whether the accused
has been actually prejudiced by an ambiguity in the language used.
[24]
The
application of criminal law doctrine to the regulatory regime created under the
Act was previously considered by the Federal Court of Appeal in Boyd v. Canada (Minister of
Transport), [2004] F.C.J. No. 2080; 2004 FCA 422. There the issue was
whether the principle of double jeopardy ought to be applied to a regulatory
charge brought by the Minister for negligent operation of an aircraft. The
Court held that the principle was only applicable to criminal or truly penal
proceedings. The Court went on to examine the issue of proper notice and it
clearly applied the administrative standard in the following passage at
paragraph 7:
Further on the notice issue, while the
particulars of the charge were not set out in the charge, Mr. Boyd in fact
received notice of all of the factual allegations being made against him. He
was given full disclosure and he knew which of his acts were being challenged.
He cross-examined witnesses on each of the allegations made against him. He
called witnesses to contradict each allegation. There were no surprises at all.
He had sufficient notice so as to preclude any holding of a lack of natural
justice.
[25]
In
this case, by applying criminal law principles to an administrative law issue,
the Appeal Panel erred. While there can be problems with the form of a Notice
issued under the Act and the Designated Provisions Regulations such that
the validity of a Notice may be open to challenge (see Air Nunavut Ltd. v.
Canada (Minister of Transport), [2001] 1 F.C. 138, [2000] F.C.J. No. 1115),
the Tribunal also has the authority to amend a Notice or to order further
disclosure. Where the granting of an amendment would disadvantage a party, the
Tribunal’s authority to adjourn a hearing will usually be an adequate remedy.
The question is always to be resolved by determining whether the affected party
knows the case it has to meet and then has a meaningful opportunity to be
heard.
[26]
Here
the defect in the Notice was obvious to all concerned. The Yukon Government
knew full well that it was the legal operator of the WIA and that it was the
intended target of the Minister’s Notices. The Yukon Government sent its legal
representative to the Tribunal hearing and he spoke on its behalf. The Yukon
Government was aware of the Minister’s motion to amend to correct the defects
in the Notices and it argued against that motion. Its counsel entered further
into the fray by cross-examining one of the Minister’s key witnesses. Counsel
for the Yukon Government readily conceded that it did not intend to mount a
substantive defence to the allegations. Not surprisingly, no request for an
adjournment was made on behalf of the Yukon Government at the close of the
Minister’s case.
[27]
In
short, the actions of the Yukon Government before the Tribunal belie any
argument that it was disadvantaged by a deficient notice or was otherwise
uncertain of its potential legal jeopardy. It clearly was aware of the
Minister’s allegations and was given the opportunity to respond and, up to a
point, took it.
[28]
While
there were others who perhaps could have been named in the Notices, there was
no confusion here that any person or party other than the Yukon Government was
at risk in the proceeding. Indeed, the amendment motion was not brought to
substitute one party for another but only to supplement the Notices to formally
describe the owner and operator of the WIA.
[29]
It
should also be remembered that the Tribunal was entitled to considerable
deference with respect to its procedural rulings. So long as it remained
within its jurisdiction and complied with the rules of fairness, the Appeal
Panel could only interfere where such a ruling was patently unreasonable: see McNaught
v. Toronto Transit Commission (2005), 74 O.R. (3rd) 278, [2005]
O.J. No. 224 (C.A.).
[30]
In
the result, I have concluded that the Tribunal did not exceed its jurisdiction
by allowing the Notices to be amended and, in the above-described
circumstances, the decision to do so was reasonable. On this issue the Appeal
Panel erred in law by setting aside the Tribunal’s decision to allow the
Notices to be amended.
Did the Tribunal Breach
the Rules of Natural Justice?
[31]
Within
the bounds of fairness, the Tribunal had a broad discretion to conduct its
hearing as it saw fit, including the right to hear evidence before ruling on
the preliminary motions before it: see McNaught, above. The Tribunal
concluded that it could be potentially advantageous and more efficient to hear
the evidence before ruling on the Minister’s motion to amend and the Yukon
Government’s opposite motion for summary dismissal. This is an accepted
approach in an appropriate case to motions of this type where a procedural
determination may be aided by evidence adduced during the hearing on the merits.
That was the conclusion reached in Regina v. Arnold, [2002] O.J. No.
3835 (C.J.) where it was held that, before ruling on a motion to declare an
information to be a nullity, it is preferable to “wait until the evidence has
been heard and to then decide whether an amendment can cure any technical
problems”.
[32]
There
were, after all, only two possible outcomes to the competing preliminary
motions – either the Minister’s amendment would be granted and the Yukon
Government formally added, or that motion would be denied and the proceeding
dismissed. There was nothing about the reservation of these procedural
decisions by the Tribunal which prevented the Yukon Government from defending
the case on the merits on the assumption that the Minister’s request for an
amendment would be granted. Indeed, there was no doubt in the mind of anyone
involved that the Yukon Government was the operator of the WIA and that it was
the intended target of the Minister’s allegations.
[33]
There
is nothing inherently unfair about the approach taken here on these facts.
Although the Yukon Government claimed that it did not know whether it was in
jeopardy during the hearing, its counsel, nevertheless, participated in the
proceeding. In addition, counsel for the Yukon Government repeatedly stated
that it did not intend to challenge the Minister’s allegations on the merits
and it obviously had no intention of presenting a substantive defence. If it
had any real concern that it was put at a disadvantage, it could and should
have requested an adjournment at the close of the Minister’s case. It failed
to do so.
[34]
I
agree with counsel for the Minister that the Appeal Panel based its fairness
conclusion upon a presumption of prejudice. Certainly no evidence of actual
prejudice was offered and none is referenced in the appeal decision. The
Appeal Panel’s conclusion that the Yukon Government was denied the opportunity
to effectively participate in the hearing is completely inconsistent with its
stated intention not to do so and, thus, the concern is purely hypothetical.
[35]
In
conclusion, the Appeal Panel erred in law by holding that the approach adopted
by the Tribunal to the preliminary motions resulted in a breach of the rules of
natural justice. The Appeal Panel decision is, therefore, set aside with the
matter to be remitted to the Appeal Panel for a redetermination in accordance
with this decision. Costs are awarded to the Applicant in the amount of
$2,500.00 inclusive of disbursements.
JUDGMENT
THIS COURT ADJUDGES that
this application is allowed with the matter to be remitted to the Appeal Panel
for a redetermination in accordance with this decision.
THIS COURT FURTHER
ADJUDGES that costs are payable to the Applicant in the amount of
$2,500.00 inclusive of disbursements.
“ R.
L. Barnes ”
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