Present: Dickson C.J. and Beetz, Estey, McIntyre, Chouinard*, Lamer and Le Dain JJ.
*Chouinard J. took no part in the judgment.
on appeal from the federal court of appeal
Administrative law ‑‑ Boards and tribunals ‑‑ Restricted Trade Practices Commission ‑‑ Investigatory hearing ‑‑ Rights of parties and witnesses ‑‑ Combines Investigation Act, R.S.C. 1970, c. C‑23, ss. 8(b), 17(1), 20(1).
The Restrictive Trade Practices Commission ordered twenty‑nine persons to appear before the Chairman or person named by him and later made an order appointing a Hearing Officer to examine these witnesses. The hearings were part of an in camera fact‑finding exercise. The Hearing Officer made a number of rulings concerning the conduct of the hearing and the role of counsel. He did not allow cross‑examination and excluded a potential witness and excused another, Kirch, from testifying, and he found that the Director need not disclose his "reasonable and probable grounds" for commencing the inquiry. When it became known that the Hearing Officer was not a Commissioner, one of the parties requested an adjournment in order to apply to a member of the Commission for an order for representation by counsel pursuant to s. 20. This adjournment was denied. The witnesses and the parties whose conduct was under investigation then launched a notice in the Federal Court Trial Division, pursuant to s. 18, to set aside the proceedings before the Hearing Officer for want of authority on his part and in particular because of these rulings. The trial judge quashed the refusal (1) to permit the parties under investigation and witnesses, where represented by counsel, to be present throughout the whole of the examinations; and (2) to permit counsel to cross‑examine or re‑examine their clients without restriction or to cross‑examine other witnesses. All issues were placed, by appeal and cross‑appeal, before the Federal Court of Appeal. The order of the Trial Division quashing the orders of the Hearing Officer was set aside but its refusal to require Kirch to testify or to order the Commission's counsel to give the objective cause of the inquiry was confirmed. At issue was the validity of the inquiry absent any demonstration by the Director of his reasons for believing an offence against the Act had been committed, the extent and role of counsel permitted under s. 20 of the Act, and the role and function of the Hearing Officer, the Director and counsel representing other parties with respect to the examination of Kirch.
Held: The appeal should be dismissed.
Appellants, at this stage of the investigatory process, are not entitled to an order quashing the inquiry because of the Director's failure to disclose to those being examined, pursuant to s. 17, his reasons for believing the existence of one or more conditions in s. 8(b). There is no linkage in the statute between ss. 8 and 17. Both are silent on the issue of disclosure and neither prescribes disclosure by the Director. The pattern set by the statute does not confine the activities of the Director to an inquiry in the formal sense. It is reasonable to construe the provision establishing an investigatory process as requiring nothing more of the Director than that he disclose the basis for his investigation when he seeks to invoke the coercive provisions of the Act.
Neither s. 20(1) of the Act nor the doctrine of fairness provides the appellants with a right to cross‑examine witnesses at the inquiry. Fairness is a flexible concept whose content varies depending on the nature of the inquiry and the consequences for the individuals involved. The extent of the right to counsel and the role of counsel, where counsel are authorized by statute, are determined by the characteristics of the proceeding, the nature of the resulting report and its circulation to the public, and the penalties which will result when events succeeding the report are put in train. The investigating body must control its own procedure. When the body has determinative powers, however, different considerations enter the process. The Act provides that the case against the investigated must be made known to him at each of the progressive stages of the inquiry.
It was premature in fact and under the Act to argue that the consequential impact of the reduced scope of counsel activity allowed by the Hearing Officer would result in a loss of reputation, exposure to criminal prosecution, reduction of freedom to compete with others because of loss of tariff protection and the exposure to adverse action by other federal agencies. The Hearing Officer could not bring about these results.
The proceedings were not at the stage where it was necessary to look at the procedure in its setting and to ask whether it operated unfairly to the point where the courts must supply the legislative omission. It was sufficient that the Hearing Officer allowed all parties to be represented by counsel who could object to improper questioning and re‑examine their clients. The courts, which are inclined not to intervene where the process is in embryonic form engaged in gathering raw evidence, become more "interventionist" where the investigating body has powers to determine.
The Hearing Officer had the discretion to exclude a potential witness from the hearing. The proceeding was not a trial where a corporation might need an employee to assist its counsel. No such right attaches to a purely investigatory process, particularly in the preliminary stage of an elaborate statutory structure where the corporation is represented by counsel.
This Court had no legal basis to respond to the application for mandamus aimed at compelling either the Hearing Officer or the Director to obtain testimony from Kirch. The Act authorized a Commissioner to appoint "any other person" before whom a person was to appear and be examined. The Hearing Officer had no statutory duty other than to preside over the witness named in the order and he was present and ready to do so. There was no basis upon which mandamus could be directed against the Director because nothing in the record or in the allegations and submissions of any party indicated that the Director had rendered himself incapable of fulfilling any other duty arising under the Act because of his not examining Kirch. No case or submission called for mandamus to be issued against the Chairman or any member of the Commission.
The Court did not address the impact of the Charter on ss. 17 and 20(1) of the Act because no oral argument had been presented after the denial of an application under Rule 32 of the Supreme Court Rules for the stating of a question as to constitutional validity. The Charter, furthermore, did not apply to the facts of this case because all rulings of the Hearing Officer being challenged were made before the Charter come into force.
Cases Cited
Considered: Nicholson v. Haldimand‑Norfolk Regional Board of Commissioners of Police, [1979] 1 S.C.R. 311; St. John v. Fraser, [1935] S.C.R. 441; Guay v. Lafleur, [1965] S.C.R. 12; In re Pergamon Press Ltd., [1971] Ch. 388; Selvarajan v. Race Relations Board, [1976] 1 All E.R. 12; Hannah v. Larche, 363 U.S. 420 (1959); Jenkins v. McKeithen, 395 U.S. 411 (1969); F.C.C. v. Schreiber, 329 F.2d 517 (1964); referred to: Re Armstrong Commercial Investigators of Canada Ltd. and Turner (1975), 9 O.R. (2d) 284; Canadian Bank of Commerce v. Attorney General of Canada, [1962] S.C.R. 729; Point ofAyr Collieries, Ltd. v. Lloyd‑George, [1943] 2 All E.R. 546; Godson v. City of Toronto (1890), 18 S.C.R. 36; Board of Education v. Rice, [1911] A.C. 179; Local Government Board v. Arlidge, [1915] A.C. 120; Wilson v. Esquimalt and Nanaimo Railway Co., [1922] 1 A.C. 202; Saulnier v. Quebec Police Commission, [1976] 1 S.C.R. 572; Martineau v. Matsqui Institution Inmate Disciplinary Board (No. 1), [1978] 1 S.C.R. 118; Re Nanticoke Ratepayers Association and Environmental Assessment Board (1978), 83 D.L.R. (3d) 722; Re McGavin Toastmaster Ltd. and Powlowski (1972), 31 D.L.R. (3d) 370, and (1973), 37 D.L.R. (3d) 100 (Man. C.A.); Ryan v. Board of Inquiry under the Human Rights Act (1976), 22 N.S.R. (2d) 444; Desjardins v. Bouchard (1976), 71 D.L.R. (3d) 491; Chisholm v. Jamieson, [1974] 6 W.W.R. 169; Re Sedlmayr, Gardiner and Demay and the Royal Commission into the Activities of Royal American Shows Inc. (1978), 82 D.L.R. (3d) 161; Re Underwood McLellan & Associates Ltd. and Association of Professional Engineers of Saskatchewan (1978), 86 D.L.R. (3d) 501, reversed on other grounds (1979), 103 D.L.R. (3d) 268; Ridge v. Baldwin, [1964] A.C. 40; Malloch v. Aberdeen Corp., [1971] 2 All E.R. 1278; Bates v. Lord Hailsham, [1972] 1 W.L.R. 1373; Pearlberg v. Varty, [1972] 1 W.L.R. 534; Attorney General of Canada v. Inuit Tapirisat of Canada, [1980] 2 S.C.R. 735; Innisfil (Corporation of the Township) v. Corporation of the Township of Vespra, [1981] 2 S.C.R. 145; Re Abel and Advisory Review Board (1980), 119 D.L.R. (3d) 101; Bushnell v. Secretary of State for the Environment, [1980] 2 All E.R. 608; Mahon v. Air New Zealand Ltd., [1984] 3 All E.R. 201; Re Royal Commission on Thomas Case, [1980] 1 N.Z.L.R. 602; Re Boehler and College of Nurses of Ontario (1982), 133 D.L.R. (3d) 642; Re Seaway Trust Co. and The Queen in Right of Ontario (No. 2) (1983), 143 D.L.R. (3d) 252; Fraternité inter‑provinciale des ouvriers en électricité c. Office de la construction du Québec, [1983s <) C.A. 7, 148 D.L.R. (3d) 626; Jones v. S.E.C., 298 U.S. 1 (1936); In re Groban, 352 U.S. 330 (1957); Anonymous No. 6 v. Baker, 360 U.S. 287 (1959); Genuine Parts Co. v. F.T.C., 445 F.2d 1382 (1971); Sneaker Circus Inc. v. Carter, 457 F.Supp. 771 (1978), aff'd 614 F.2d 1290 (1979); Georator Corp. v. Equal Employment Opportunity Commission, 592 F.2d 765 (1979); Re The Ontario Crime Commission, Ex parte Feeley and McDermott, [1962] O.R. 872; Public Inquiries Act and Shulman, Re, [1967] 2 O.R. 375; Re Children's Aid Society of the County of York, [1934] O.W.N. 418; Batary v. Attorney General for Saskatchewan, [1965] S.C.R. 465; Faber v. The Queen, [1976] 2 S.C.R. 9; R. v. McDonald, Ex parte Whitelaw (1968), 2 D.L.R. (3d) 298; Wiseman v. Borneman, [1971] A.C. 297; Barnes v. City of London Real Property Co., [1918] 2 Ch. 18.
Statutes and Regulations Cited
Administrative Procedure Act, 5 U.S.C.A., s. 555(b).
Canada Evidence Act, R.S.C. 1970, c. E‑10, s. 5.
Canadian Charter of Rights and Freedoms , ss. 7 , 8 .
Collection Agencies Act, R.S.O. 1980, c. 73.
Combines Investigation Act, R.S.C. 1970, c. C‑23, ss. 7, 8(b), (c), 9, 10, 11, 12, 14, 15(1), (2), 16, 17(1), 18(1)(a), (b), (2), (3), (4), 19(2), (5), 20(1), (2), 21, 26, 27(1), (2), 27.1, 28, 31.2, 32(2), (3), 47(1)(b), (2).
Competition Act , S.C. 1986, c. 26, ss. 18‑47, 67.
Constitution of the United States of America, Fourteenth Amendment, Bill of Rights.
Criminal Code, R.S.C. 1970, c. C‑34, s. 643.
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, ss. 18, 28.
Income Tax Act, R.S.C. 1952, c. 148.
Inquiries Act, R.S.C. 1970, c. I‑13.
Public Inquiries Act, R.S.O. 1960, c. 323, s. 5(1).
Supreme Court Rules, SOR/83‑74, as am., s. 32.
Authors Cited
de Smith, Stanley Alexander. Judicial Review of Administrative Action, 4th ed. By J. M. Evans. London: Stevens & Sons, 1980.
Halsbury's Laws of England, vol. 3, 4th ed. London: Butterworths, 1973.
Pollock, Sir Frederick and Frederic William Maitland. The History of English Law, vol. 1, 2nd ed., reissued. Cambridge: Cambridge University Press, 1968.
Schopler, Ernest H. "Right to Assistance by Counsel in Administrative Proceedings" (1970), 22 ALR3d 229.
Shorter Oxford English Dictionary, "Inquiry". Oxford: Clarendon Press, 1959.
"The Distinction Between Informing and Prosecutorial Investigations: A Functional Justification for `Star Chamber' Proceedings" (1963), 72 Yale L.J. 1227.
Wade, Henry William Rawson. Administrative Law, 5th ed. Oxford: Clarendon Press, 1982.
APPEAL from a judgment of the Federal Court of Appeal, [1982] 2 F.C. 500, 132 D.L.R. (3d) 323, allowing an appeal from a judgment of Collier J., [1982] 1 F.C. 73. Appeal dismissed.
Edgar Sexton, Q.C., and Valerie Dyer, for the appellant Harold Irvine.
Jeffrey Leon, for the appellants Namasco Limited and Charles Ian McKay.
S. N. Lederman, Q.C., and Robert Rueter, for the appellant Drummond McCall Inc.
John A. B. Macdonald, Q.C., and Hugh A. Christie, for the appellants Samuel, Son & Co. and W. Grant Brayley.
J. A. Hodgson and N. R. Finkelstein, for the appellant Westeel‑Rosco Ltd.
F. J. C. Newbould, Q.C., for the appellants York Russel Inc., L. F. Newbury, Norman Katzman, John M. White, Leon Robidoux and Timothy H. Coughlin.
Robert Mongeon, for the appellants Newman Steel Ltd., Benjamin P. R. Newman, Sigmund R. Taube, Zenon P. Karcz and Peter R. Sheppard.
John Sopinka, Q.C., and David Brown, for the appellants Lorne Gilbert Coons, James Arthur Jobin, Donald Charles Grinstead, Hugh Fitzgerald Thomson, William Alexander Mowat and Bruce Scott Moore.
Bryan Finlay, Q.C., and Graham Garton, for the respondents.
The judgment of the Court was delivered by
1. Estey J.‑‑This appeal raises many questions about the rights and obligations of persons concerned with administrative procedures and hearings under the Combines Investigation Act, R.S.C. 1970, c. C‑23, as amended (hereinafter referred to as "the Act"). Substantial portions of the Act have been repealed and replaced by the Competition Act (An Act to establish the Competition Tribunal and to amend the Combines Investigation Act and the Bank Act and other Acts in consequence thereof, S.C. 1986, c. 26, ss. 18‑47). Section 67 of the transitional provisions in Part IV of the Act provides that the Combines Investigation Act is continued in effect for the purposes of completing any inquiry or proceeding which commenced prior to the enactment of the 1986 revisions.
2. The story, which becomes complicated, all began with an order issued by the Chairman of the Restrictive Trade Practices Commission some time between January 27 and February 2, 1981 directing the attendance on March 2, 1981 of twenty‑nine persons before the Chairman or any person named by him, to give evidence under oath. This was made on the application of the Senior Deputy Director of the Investigation and Research Branch of the Commission on January 27, 1981, presumably pursuant to s. 17(1) of the Act.
3. This constitutive order is not in the record. Its style of cause is known.
IN THE MATTER OF the Combines Investigation Act and section 32 of the said act
and
IN THE MATTER OF an Inquiry relating to the production, manufacture, purchase, sale and supply of flat rolled steel, plate steel, bar and structural steel and related products
In a subsequent order issued on February 3, 1981 the Chairman recited in his preface:
Upon an application of the Senior Deputy Director of Investigation and Research, Combines Investigation Act, dated January 27, 1981, I ordered, pursuant to section 17(1) of the Act, that the twenty‑nine persons hereinafter listed, attend before me or before any other person named for the purpose by me pursuant to section 17, at ... on Monday, the second day of March, 1981, ... to give evidence upon oath in connection with the above inquiry.
4. In this order the Chairman appointed Mr. H. H. Griffin as "the person before whom such evidence shall be given...." The order then lists the twenty‑nine witnesses. Mr. Griffin is not one of the Commissioners on the Restrictive Trade Practices Commission. In these reasons, Mr. Griffin will be referred to as the Hearing Officer. Section 32 referred to in the style of cause above sets out some offences under Part V of the Act, entitled "Offences in Relation to Competition".
5. On February 2, 1981 notices were sent to corporate employers whose employees had been directed to attend and give testimony, and/or to others who were engaged in the business described in the style of cause. These notices were under the above style of cause and ordered:
Pursuant to authority conferred by and under the said Act, you are hereby required and ordered to attend before Mr. O. G. Stoner, Chairman of the Restrictive Trade Practices Commission or before any other person named for the purpose by me at ... on Monday, the second day of March, 1981, ... to give evidence upon oath in connection with the above inquiry.
6. On February 25, 1981 the Hearing Officer commenced the examination of these witnesses, under oath. Counsel for the Director explained to the Hearing Officer the nature of the proceedings in this way:
At the present time we are involved in a fact‑finding exercise; no individual and no company has been charged with any offence of the Combines Investigation Act at this time.
Counsel for the Director then went on to advise the Hearing Officer that these hearings were generally conducted under the policy of the Director in camera and that if other people were hereafter subpoenaed and were inadvertently advised by counsel of those presently before the Hearing Officer of the evidence taken to date,
... this would definitely prejudice the Director's opportunity to gather information, and, as I say once again, this is only a fact‑finding exercise and is not contemplated as being a Star Chamber exercise: no one has been charged yet.
Consequently, I submit that, in order for the Director to be able to gather all of the relevant evidence, both indicating the possibility of a crime having been committed and that which would refute such an allegation, it is in the Director's interests that a full and complete opportunity to gather this information be granted to him.
7. In the ensuing hearing, the Hearing Officer made the following rulings in response to objections and submissions by counsel representing some of the witnesses and some of the persons whose conduct appeared to be under investigation, and by counsel for the Director:
1.Counsel appearing for witnesses and for those persons (including companies) whose conduct is apparently under investigation could be present at the hearing subject to later exclusion by the Hearing Officer if prejudicial evidence was being received and the presence of a formidable array of counsel might discourage a witness or dissuade him or her from giving evidence.
2. Counsel for the Director may examine a witness on documents seized from his employer and other companies and need not furnish the witness with copies of those documents taken from his own employer. The Director must, however, at the time of the examination provide the witness with copies of those documents seized from other companies.
3. An officer of the company (Drummond McCall Inc.), already represented by its counsel, could not remain in the hearing as he might later be called as a witness although he was not included in the twenty‑nine witnesses named in the order of the Chairman.
4. Counsel for the Director would conduct the examination‑in‑chief of each witness, with the role of counsel for the witness being limited to re‑examination for the purpose of clarification or explanation of matters raised in the Director's examination, and generally to assist the witness.
5. The Director need not examine a witness (one Kirch) who objected to testifying in the presence of other counsel on the basis that he felt "intimidated". The Hearing Officer declined to examine Kirch himself and refused to allow counsel for other witnesses and persons whose conduct was being investigated to do so.
6. The Hearing Officer would not order the Director to disclose his "reasonable and probable grounds" for commencing the inquiry to those whose conduct was apparently being investigated.
8. About this time some of the parties became aware that the Hearing Officer was not a Commissioner. Counsel for one of the companies appearing by officer and by counsel (Drummond McCall Inc.) thereupon requested an adjournment of the hearing to permit an application to a member of the Commission for an order pursuant to s. 20 of the Act, for representation by counsel. The adjournment was denied by the Hearing Officer who was concerned with the expense of delaying the proceedings to both the public and the companies whose conduct was being inquired into. A notice of motion was then launched in the Trial Division of the Federal Court of Canada under s. 18 of the Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, by witnesses and by persons whose conduct was apparently under investigation, for relief in the nature of certiorari, prohibition and mandamus "to restrain and set aside all proceedings pending before [the Hearing Officer] under the apparent authority of s. 17 of the Combines Investigation Act on the ground that he is without authority to preside over them"; and in particular, to make the first six of the several rulings already enumerated. Item 6 was the subject of a supplementary application:
(a) his decision that objective cause need not be given by Commission Counsel to the parties whose conduct is being inquired into when an inquiry is commenced under s. 8(b) of the Combines Investigation Act R.S.C. 1970 c. C‑23 as amended.
9. The learned trial judge, Collier J. quashed the following decisions of the Hearing Officer:
1.the refusal to permit persons whose conduct is being inquired into, and witnesses where represented by counsel, to be present throughout the whole of the examinations;
2. the refusal to permit counsel representing persons whose conduct is being inquired into and counsel representing witnesses, to examine or re‑examine without restriction their own clients, or to cross‑examine other witnesses;
3. the refusal of the request by Drummond McCall Inc. for an adjournment of the hearing so as to permit the applicant to apply to a Commissioner for an order permitting representation by counsel at the inquiry. (This issue is not raised in this Court.)
He rejected all other parts of the above applications. The trial judge specifically concluded that because the Hearing Officer owed a duty to the Commission and not to the applicants to take the evidence of Kirch, the application for an order directing the examination of Kirch by the Hearing Officer, Commission counsel or counsel for the applicants was denied.
10. All these issues were placed before the Federal Court of Appeal by appeal and cross‑appeal. The Federal Court of Appeal set aside the order of the Trial Division quashing the orders of the Hearing Officer as enumerated above; and confirmed the refusal by the Trial Division (a) to require Kirch to testify and to permit counsel for the applicants to put questions to Mr. Kirch; and (b) to make an order requiring the Commission's counsel to give to parties whose conduct was being inquired into in an inquiry which in the view of Collier J. was being held under s. 8(b), the objective cause of the inquiry. The appellants in their supplementary application, supra, likewise assumed the inquiry was being conducted under s. 8(b). In the result, the Court of Appeal dismissed the applicants' Notice of Motion and supplementary Notice of Motion in their entirety.
Issues
11. The questions raised in these proceedings fall into three categories:
1. The validity of the inquiry being conducted under the Act by the Director in the absence of any demonstration by the Director that he had "reason to believe" an offence against the Act has been committed by any person whose conduct is being inquired into, or that grounds exist for an order by the Commission under Part IV.1 of the Act; or that the inquiry has been directed by the Minister, all as may be provided or required by s. 8 of the Act;
2. Can the first issue be raised under the present applications which are concerned only with the Hearing Officer's rulings or orders, which relate to but make no mention of an order issued on or after January 27, 1981 and on or before February 2, 1981 by the Chairman of the Commission and which order is not in the record?
3. The extent of the role of the counsel "allowed" or "permitted" under s. 20 of the Act to represent a person whose conduct is being inquired into or a person being examined under oath;
4. The role and function of the Hearing Officer, the Director and counsel representing other parties in the examination of Mr. Kirch, a person called to attend and give evidence at the inquiry under the order of the Commission issued on February 3, 1981 and probably under the order of the Chairman issued on or after January 27, 1981 as well.
The Act
12. Many if not all these issues require for their answer an interpretation and assessment of the relevant portions of the Act. The Act is divided into seven parts of which Part I‑‑Investigation and Research; Part II‑‑Consideration and Report; Part III‑‑General; and Part VII‑‑Investigation of Monopolistic Situations, principally concern us in this appeal.
13. In Part I the office of the Director of Investigation and Research is established. Part II of the Act establishes the Restrictive Trade Practices Commission consisting of a Chairman and not more than three other members. The Commission has many duties and functions under the Act including the authorization of the examination of witnesses under oath by the Director and the production of documents by such witnesses (s. 17); the reception of statements of evidence from the Director and the hearing of submissions from persons against whom allegations are therein made (s. 18); the making of reports to the Minister on such matters (s. 19); and permitting or allowing counsel to represent witnesses or persons whose conduct is being inquired into at a hearing before a Commissioner or a person nominated by a Commissioner (s. 20(1)) as in the case of the Hearing Officer in these proceedings. Part III includes s. 26 which authorizes the Minister to require the Director to submit interim reports on any inquiry being conducted by the Director and such interim report shall set out the evidence thus far obtained and the Director's opinion as to the effect of the evidence. Part III also provides that all inquiries under the Act shall be conducted in private except where the Commission itself may conduct an inquiry in whole or in part in public (s. 27); and the Director, at the request of any federal board or on his own initiative or on direction from the Minister, shall make representations to and call evidence before any such board in respect of the maintenance of competition (s. 27.1). Part IV provides for the reduction of importation duties by the Governor in Council whenever, as the result of an inquiry or of judgments in courts, it appears that by reason a conspiracy or combination the public is disadvantaged (s. 28). Part V as mentioned at the outset sets out the offences in relation to competition. Part VII includes provisions for the directing of an inquiry by the Director into monopolistic and other conditions of trade and to report thereon to the Minister (s. 47); together with other responsibilities not here relevant.
14. The "Minister" referred to in the Act is the Minister of Consumer and Corporate Affairs except where specific reference is made, for example in s. 31.2, to the Minister of Finance, and in s. 15 where the reference is to the Attorney General of Canada.
15. The statutory scheme was no doubt clear and consistent when the statute was first enacted. It has over the years had new provisions patched on, older sections deleted, phrases wedged in or subsections carved out until the meaning of some of the provisions is obscure. By the time of its revision in 1986, the statutory scheme seriously lacked any symmetry. The Court must nonetheless interpret and apply the main sections and the core of this Act in order to dispose of this appeal while recognizing throughout that this statute itself has largely been repealed and replaced.
16. Part I established the Director of Investigation and Research and s. 8 prescribes some of the circumstances in which the Director will cause an inquiry to be made. Because this section is of fundamental importance to the ensuing discussions it should be set out in full:
8. The Director shall
(a) on application made under section 7,
(b) whenever he has reason to believe that
(i) a person has contravened or failed to comply with an order made pursuant to section 29, 29.1 or 30,
(ii) grounds exist for the making of an order by the Commission under Part IV.1, or
(iii) an offence under Part V or section 46.1 has been or is about to be committed, or
(c) whenever he is directed by the Minister to inquire whether any of the circumstances described in subparagraphs (b)(i) to (iii) exists,
cause an inquiry to be made into all such matters as he considers necessary to inquire into with the view of determining the facts.
It will be seen that the Director must, for example, launch an inquiry when he receives a citizen's application under s. 7 or a ministerial direction under s. 8(c). He must also cause an inquiry to be made "when he has reason to believe" that there has been a failure to comply with orders issued by a court under the Act, that there are grounds for a recommendation by the Commission to the Minister of Finance for the removal or reduction of customs tariffs and the issuance by the Commission of related orders, or that an offence has been committed under the provisions of the Act forbidding the undue limitations on competition.
17. Section 8 contains no rules or procedures for the guidance of the Director in investigating those matters by statute assigned to him. The word "inquiry" appears in the Act to be carrying its ordinary meaning which, according to the Shorter Oxford English Dictionary (1959), at p. 1012, is the "action or an act or course of inquiring ... the action of seeking ... truth, knowledge or information concerning something; search, research, investigation, examination". The verb "to inquire" is on the same page and is defined as including "to investigate". The section does not set up any organization in the sense that the word inquiry is sometimes employed. Nor does it prescribe any process or procedure or rules for the guidance of the Director in making his inquiry.
18. By other sections in Part I the Director is authorized in the course of the conduct of his inquiry to enter premises and copy or remove documents, or to require a return of any information required of a business. Where circumstances require, the Director may apply to the Commission for authority to require evidence upon affidavit. These provisions of Part I also authorize the Director to discontinue any inquiry (unless the evidence taken has already been placed before the Commission) (s. 14). All this is established in Part I of the Act under the heading "Investigation and Research". The Director may also, during such an inquiry or on its termination, turn any evidence or records over to the Attorney General of Canada "for consideration as to whether an offence has been or is about to be committed against this Act, and for such action as the Attorney General of Canada may be pleased to take" (s. 15(1)). Subsection (2) authorizes the Attorney General of Canada to institute and conduct any prosecutions under the Act. The Director is given no role in any such proceedings.
19. Part II of the Act (by s. 16) establishes the Restrictive Trade Practices Commission to which reference has already been made in Part I of the Act in s. 14. Part II then proceeds to lay out the program for the processing by the Commission of the material gathered by the Director in his inquiries. When the Director requires coercive measures to obtain evidence, he may secure from the Commission, on ex parte application, an order directed to anyone present in Canada to appear before a member of the Commission, or any other person named for the purpose, and be examined upon oath or produce documents (s. 17(1)). This section curiously is not found in Part I but in Part II entitled "Consideration and Report", which is concerned in the main with the work of the Commission after the Director has delivered the evidence received in his inquiries. Because s. 17(1) is central to this appeal it should be set out in full:
17. (1) On ex parte application of the Director, or on his own motion, a member of the Commission may order that any person resident or present in Canada be examined upon oath before, or make production of books, papers, records or other documents to such member or before or to any other person named for the purpose by the order of such member and may make such orders as seem to him to be proper for securing the attendance of such witness and his examination, and the production by him of books, papers, records or other documents and may otherwise exercise, for the enforcement of such orders or punishment for disobedience thereof, all powers that are exercised by any superior court in Canada for the enforcement of subpoenas to witnesses or punishment of disobedience thereof.
20. As we have seen, notices were sent out to the appellants by the Director of the orders made by the Chairman of the Commission under s. 17. It is not at all clear in either the wording or the layout of the statute in general whether the powers under s. 17 are designed to feed an inquiry under s. 8 in another part of the Act or are directed to the assistance of the Director in preparation for a Commission hearing under the ensuing sections in Part II. This consideration bears upon the submissions by the appellants that all inquiries must be under s. 8 and that in order to launch an inquiry the Director must demonstrate reasonable belief in one or more of the matters described in s. 8. If section 17 is intended as an initiating part of the program in Part II as distinct from Part I, no such requirement would ordinarily be inferred or implied and certainly has not been expressly assigned by the section to the Director.
21. By section 18 of the Act, where the Director is of the opinion that the evidence obtained discloses an offence under Part V (the principal competition offences in the Act), the Director may, or if the inquiry relates to an alleged or suspected offence under Part V and the Minister so requires, the Director shall "prepare a statement of the evidence obtained in the inquiry which shall be submitted to the Commission and to each person against whom an allegation is made therein". Unlike Part I where the inquiry section (s. 8) is followed by a section (s. 15) authorizing the Director to turn evidence and materials gathered in the inquiry over to the Attorney General of Canada for consideration as to whether or not a prosecution should be instigated, s. 18 provides that the Director may forward a statement of the evidence obtained in the inquiry to the Commission if he is of the opinion that "the evidence obtained discloses a situation contrary to any provision in Part V" (s. 18(1)(a)). The Director is neither directed nor authorized by the statute to include any findings, facts or recommendations in such a statement. Subsection (1) concludes with a direction to the Director to forward to each person a copy of the statement submitted by the Director to the Commission, "against whom an allegation is made therein". What remains unexplained in the statute is how the Minister is made aware that an inquiry is being conducted by the Director under the Act with reference to an allegation or suspected offence under Part V except where the Minister has himself directed the inquiry under s. 8. In any event, if he becomes aware of such an inquiry he may direct the Director to prepare a statement to the Commission.
22. The Commission thereupon conducts a hearing at which the Director and persons against whom allegations are made in a statement under s. 18(1) shall be heard "in person or by counsel". The Commission is not limited, however, to the statement of evidence prepared by the Director. Subsection (3) states:
(3) The Commission shall, in accordance with this Act, consider the statement submitted by the Director under subsection (1) together with such further or other evidence or material as the Commission considers advisable.
Subsection (4) appears to be added to s. 18 out of an abundance of caution:
(4) No report shall be made by the Commission under section 19 or 22 against any person unless such person has been allowed full opportunity to be heard as provided in subsection (2).
23. By section 19 the Commission is required, "as soon as possible" after the proceedings under s. 18 are concluded, to "make a report in writing and without delay transmit it to the Minister". The Commission's report shall (a) review the evidence and material, presumably including both that contained in the Director's "statement" and that received by the Commission on its own hearing under s. 18; (b) "appraise the effect on the public interest of arrangements and practices disclosed in the evidence"; (c) "contain recommendations as to the application of remedies provided in this Act or other remedies" unspecified in the legislation; and (d) where from Commission proceedings under s. 18 it appears that a conspiracy, combination, agreement or arrangement has existed, include a finding whether they relate only to matters described in s. 32(2) (the conspiracy offence provisions), and if so, make a further finding as to whether such conspiracy, etc., has lessened or is likely to lessen competition, including competition in respect to prices, production or other matters mentioned in s. 32(3).
24. I digress to point out that by s. 27(1) (a provision found in another Part of the Act) "All inquiries under this Act shall be conducted in private". The section goes on to state, however: "except that the Chairman of the Commission may order that all or any portion of such an inquiry that is held before the Commission or any member thereof be conducted in public". It is not clear whether this includes the taking of evidence by the person designated by a Commissioner under s. 17. In this appeal that was the Hearing Officer. By subsection (2) the rule is reversed with respect to all proceedings before the Commission "other than proceedings in relation to an inquiry". Commission proceedings shall be in public unless the Chairman of the Commission orders that they be held in private. Proceedings before the Commission relating to an inquiry shall nevertheless be in private. When subsections (1) and (2) are read together it would appear that an order of the Chairman would be required for the proceeding before the Hearing Officer to be in public and no such order appears on the record. From the transcript it would appear that this evidence was taken by the Hearing Officer in private.
25. Returning to s. 19, subs. (5) thereof requires that the Commission's report (not the Director's statement of evidence under s. 18) shall be published by the Minister unless the Commission states that "the public interest would be better served" if it were not published. In that event the statute leaves it to the Minister to decide whether or not the report shall be published in whole or in part. These proceedings of course have not reached any such advanced stage. This brings our examination of the investigative program under the statute to s. 20(1) of Part II around which much of the argument in this appeal rotates.
20. (1) A member of the Commission may allow any person whose conduct is being inquired into and shall permit any person who is being himself examined under oath to be represented by counsel.
26. Presumably subs. (1) applies to all inquiries whether under s. 8 or s. 47 (relating to monopolistic situations), or under s. 17 if that process amounts to an inquiry separate and apart from s. 8, or under s. 18(4) where the Commission itself may collect evidence and material in the process of making its report to the Minister. Section 20(2) throws some light on this question. That provision is to the same purpose as s. 5 of the Canada Evidence Act, R.S.C. 1970, c. E‑10, and provides that a person ordered by a Commissioner to give evidence or to produce documents may not be excused from doing so because it may tend to criminate him. No evidence so given, however, may be receivable against such person in criminal proceedings (other than perjury) brought against him. This section goes a long way in protecting an individual should criminal proceedings subsequently be commenced. The provision in subs. (2) obviously relates back to s. 8 inquiries in those instances where persons are being examined under oath. It is natural to construe subs. (1) as likewise applying to all inquiries launched under the Act. However, examination under oath only takes place under the Act when an order is made under s. 17 or when the Commission itself conducts a hearing under s. 18 and invokes its powers under the Inquiries Act, R.S.C. 1970, c. I‑13, under s. 21. There appears to be no provision other than ss. 17 and 21 whereby the Commission can itself take evidence under compulsion. The Director in that case may act as Commission counsel in the examination of a witness before the Commission itself where that witness is brought there by the process authorized under s. 17. Thus section 17 may or may not be employed by the Commission in its hearing procedures following receipt of the Director's statement of evidence.
27. All this leads up to an examination of the right to counsel when acting under s. 20. Where the coercive powers of the Act are employed to examine a witness, the Commission shall permit the witness to be represented by counsel. This is mandatory and is the right granted by statute whether the examination results from s. 17 or from s. 21. On the other hand, a person whose conduct is being inquired into may be allowed to be represented by counsel, but not as of right. Thus, where the Director is gathering evidence under s. 9 (requisitioning returns of information), s. 10 (entry into premises), s. 11 (inspection of documents), and s. 12 (requiring evidence upon affidavit where authorized by a Commissioner), no absolute right to counsel arises in the person affected by any such processes.
28. Where the person under investigation in any inquiry becomes aware of that fact, he may be allowed by a Commissioner to be represented by counsel. Thus the Commissioner has a discretion to allow counsel at any stage of an inquiry whether or not coercive measures have been invoked; but no right to counsel arises in the investigated person in any of these circumstances. It could be strongly argued that s. 20 does not relate to inquiries generally under the Act but only to inquiries in which s. 17 is employed. Considering the setting of s. 20(1) in the Act I conclude, however, that the section applies generally to all inquiries, to the extent and in the manner discussed above.
29. There are several relevant but unconnected sections of the Act which should be noted. For example, in Part III, "General", s. 26 authorizes the Minister at any time to require the Director to submit an interim report on any inquiry by him under the Act which report shall set out the action taken, the evidence obtained and "the Director's opinion as to the effect of the evidence". Nothing is said as to what the Minister must or may do with any such report. Section 27.1 authorizes the Director, either on his own initiative or when requested by a federal board or the Minister, to make representations to any federal board and to call evidence before any such board in respect of the maintenance of competition. The section does not relate necessarily to any inquiry being then or theretofore undertaken by the Director. In Part IV, "Special Remedies", s. 28 authorizes the Governor in Council, whenever as the result of an inquiry under the Act or of a judgment of a court it appears to the satisfaction of the Governor in Council that a conspiracy, combination, agreement or arrangement, merger or monopoly has existed with reference to any article to promote unduly the advantage of manufacturers and others at the expense of the public, to direct that such article may be admitted free or at reduced import duty rates which, in the opinion of the Governor in Council will "give the public the benefit of reasonable competition". The Director is given no part to play in connection with either the operation of s. 28 or the origins of the administrative action giving rise to the action taken under s. 28. The section does not articulate any connection or channel of communication between the Director or the Commission with respect to an inquiry under the Act, and the Governor in Council. Part IV.1, "Matters Reviewable by Commission", makes a similar reference to a process whereby the Commission may recommend to the Minister of Finance that duties of customs be removed and the Commission may order a supplier to accept a specified person as a customer (s. 31.2). This process may originate "on application by the Director" to the Commission and is predicated upon the Commission making a recommendation to the Minister of Finance. Again no reference is made in the provision to a requirement of an inquiry by the Director or to a report by the Director as a result of an inquiry. Part VII, "Investigation of Monopolistic Situations", includes s. 47 which authorizes the Director, on his own initiative or on direction from the Minister or the Commission, to carry out an inquiry into conditions or practices relating to any product where such conditions or practices are related to monopolistic situations or restraint of trade. The section concludes with this broad mandate:
47. (1) The Director ...
(b) upon direction from the Minister shall carry out a general inquiry into any matter that the Minister certifies in the direction to be related to the policy and objectives of this Act....
The subsection concludes that any inquiry made under this subsection "shall be deemed to be an inquiry under section 8".
30. To complete the description of this feature in the statute s. 47(2) should be set out:
47. ...
(2) It is the duty of the Commission to consider any evidence or material brought before it under subsection (1) together with such further evidence or material as the Commission considers advisable and to report thereon in writing to the Minister, and for the purposes of this Act any such report shall be deemed to be a report under section 19.
This subsection provides for the continued processing by the Commission of the results of the Director's inquiry and the information thereby derived, leading to a report to the Minister by the Commission which "shall be deemed to be a report under s. 19". Thus Part VII establishes a parallel to the process established under Parts I and II. As we shall see, the Court of Appeal concluded that the inquiry in question here might well have been a process under either s. 8 (Part I) or s. 47 (Part VII). The trial judge assumed (as did the appellants in the Supplementary Application) without discussion that it was a proceeding under s. 8.
31. The foregoing statutory structure is complex and extensive but does not appear to be fully articulated and certainly raises many questions as to the meaning and intent of some of its provisions. The operations of the Director, the Commission and the three Ministers involved are not coordinated in detail or completely. These several statutory procedures may be summarized as follows. The Director may:
(a)submit records and evidence obtained on an inquiry to the Attorney General of Canada who may prosecute;
(b)make an interim report at the request of the Minister in the course of any inquiry and shall be required to express his opinion as to the effect of the evidence;
(c)be requested or may on his own motion make presentations unrelated to any inquiry to any federal board;
(d)may and shall, if required by the Minister, submit a statement of evidence obtained on an inquiry to the Commission and give copies thereof to all against whom allegations are therein made.
32. In all these functions the Director makes no decisions in the sense of a final determination of a right or an interest. He makes recommendations and allegations and forms opinions for consideration by others and sometimes only gathers facts and information for consideration by Ministers or by the Commission.
33. The Commission has the following duties under this investigatory scheme:
(a)to order witnesses be examined on oath or produce books, papers, records or other documents and to enforce such orders;
(b)to receive statements of evidence from the Director and to conduct hearings in the course of considering such statements;
(c)to make reports to the Minister in which recommendations are made as to available and appropriate remedies;
(d)to make reports to the Minister wherein findings may be made as to whether conspiracy and other arrangements occurred which are likely to lessen competition;
(e)and may recommend to the Minister of Finance that duties be removed or reduced and may order that suppliers accept certain persons as customers. There is nothing in the Act whereby the Minister may act on such a recommendation. Section 28 gives such authority to the Governor in Council.
In summary, the Commission's role is largely performed in the second stage and consists of processing of information gleaned by the Director in the exercise of his investigatory function.
34. The Act authorizes actions of one type or another by three Ministers, the Minister of Consumer and Corporate Affairs, the Minister of Finance and the Attorney General of Canada. The Minister of Consumer and Corporate Affairs is the primary Minister responsible for the administration of the statute. The statute confers no power on the Minister to act upon any report, recommendation or finding by the Commission except to decide whether to publish the Commission's report. The Attorney General of Canada may institute and prosecute charges under the Act but does not receive recommendations in that connection from the Director nor is the Director involved in the process of the laying of charges or the prosecution. The Minister of Finance is given no express authority under the Act but presumably, as an advisor to the Governor in Council, he may serve as the link between the Commission and its recommendations with reference to customs duties and the reduction or removal of duties by the Governor in Council.
35. That, in overall view, is the regulatory pattern established by the Act. The entire administration of this Act is done in private except where publication of the Commission's report or the conduct of Commission hearings is directed, and the conduct of prosecutions. At the stage of the administrative process reached here, nothing has been done in public except the application to the Federal Court and to this Court.
36. A threshold issue arises as to whether, on a motion challenging the rulings of the Hearing Officer, the Court can consider the validity of the order under which the inquiry process in question was instituted. Some of the appellants have submitted that the Director, before invoking the coercive powers in s. 17, must disclose reasonable cause for initiating the inquiry. The Hearing Officer ruled that the Director need not reveal any "objective cause" to the parties being investigated. These appellants say this renders the whole process invalid. The trial judge concluded firstly that this objection should have been raised in separate proceedings under ss. 18 or 28 of the Federal Court Act "against the authority of the Director"; and in any case cannot be brought forward in proceedings which only attack rulings made by the Hearing Officer. The Court of Appeal agreed and concluded that the process under s. 17 is limited to an examination of witnesses before the Hearing Officer designated by the Chairman of the Commission, all of which was done within the terms of s. 17. Hence, in the view of that court, the broader issue of the validity of the inquiry does not arise.
37. Sections 17 and 8 are both silent on the issue of disclosure and certainly prescribe no such prerequisite disclosure by the Director. Furthermore, the pattern cut by the statute does not confine the activities of the Director to an inquiry in the formal sense. Section 8, for example, describes three situations in which the Director "shall ... cause an inquiry to be made"; but the section is not exclusive. Section 17 makes no reference to an inquiry under s. 8 or otherwise. Other sections in the Act, such as ss. 18, 26 and 47, refer to "an inquiry" but again are functionally limited. Where the legislature or Parliament wishes to establish a condition precedent to the launching of an inquiry, the legislature is free to do so. This requirement is found in the Collection Agencies Act of Ontario [R.S.O. 1980, c. 73]. See Re Armstrong Commercial Investigators of Canada Ltd. and Turner (1975), 9 O.R. (2d) 284. See also Canadian Bank of Commerce v. Attorney General of Canada, [1962] S.C.R. 729, re the Income Tax Act, R.S.C. 1952, c. 148. It should be observed that s. 18(1)(b) indicates that an inquiry may relate to an offence under Part V but also that the inquiry may relate to something apart from an alleged offence under Part V. The section does not prescribe or imply any preliminary requirement that the Director disclose to someone the grounds for commencing an inquiry. Where the inquiry is commenced by reason of one of the three conditions described in s. 8, disclosure might be made to the persons being examined, the Commissioner who issued the order for examination under s. 17, or perhaps the Hearing Officer. The section is silent on all these matters. Certainly there would be no one to whom disclosure could be required where the inquiry is launched under s. 8(c) because there the inquiry is directed by the Minister.
38. We of course do not have in the record as filed by the appellants a copy of the initiating order by the Chairman of the process authorized under s. 17. It may well be that the ex parte application by the Director reveals a ground or basis for seeking the order for the examination of witnesses under oath and the production of documents. Because that order has not been challenged and has not been produced to the Court, a court must presume that all steps prescribed, expressly or by implication, under the statute have been taken. The presumption of regularity of process would fill in any gap which might have in fact occurred. (See Point of Ayr Collieries, Ltd. v. Lloyd‑George, [1943] 2 All E.R. 546 (C.A.); Wade, Administrative Law (5th ed. 1982), at p. 305.)
39. The next question is whether there is a further duty in the Director to disclose such belief to the person named in the order. The statute is silent. It does not direct the Commission to certify the existence of such a belief in the applicant Director. It does not direct the Director to communicate to persons in the position of the appellants his reason to believe that any of the conditions described in s. 8(b) exist. There is no linkage in the statute between ss. 8 and 17. There is in short no basis in the statute for the order sought in the supplementary application by the appellants. It is reasonable to construe this provision, establishing as it does an investigatory process, requiring nothing more of the Director than that he disclose such basis for his investigation when he seeks to invoke the coercive provisions of the Act, such as s. 17. In that case, disclosure would be to the Commissioner from whom the order summoning witnesses is sought. Yet that section is silent on the matter as well.
40. In my view, the appellants are not entitled at this stage of the statutory investigatory process to an order quashing the inquiry by reason of the failure of the Director to disclose to those being examined under s. 17 or are being investigated under ss. 8 or 47 of the Director's reason for belief that one or more of the conditions in s. 8(b) exist.
41. This brings us to the central issue, the nature and extent of the role of the several counsel for the applicants "allowed" or "permitted" to represent the applicants under s. 20(1) of the Act. It is observed at once that counsel and applicants alike seem to have assumed from the outset, and at least until well into the hearings, that the Hearing Officer was a member of the Commission. Until the steps leading to the commencement of these proceedings were taken, no application was made by any party to the proceedings for an order under s. 20(1) for representation by counsel because it was not appreciated that the Hearing Officer was not a member of the Commission. In the meantime, counsel had "appeared" before and had been "permitted" by the Hearing Officer to represent many of the persons named in the order as witnesses to be examined before the Hearing Officer. In all, eighteen of the twenty‑nine witnesses named in the orders of the Chief Commissioner appeared with or through counsel. In addition, eleven companies to whom notices had been sent by the Director were likewise represented by counsel before the Hearing Officer.
42. There is no evidence that any party desiring representation by counsel was not in fact so represented in the proceeding before the Hearing Officer. I proceed into this question on the basis that all counsel who appeared were treated by the Hearing Officer as though all such counsel had been formally "permitted" or "allowed", as the case may be, under s. 20(1).
43. The real question therefore is the determination of the rights of a person "whose conduct is being inquired into", and of a person being examined as a witness, in relation to the conduct of an inquiry under the Act, and specifically of the rights of their counsel, once "allowed" or "permitted", under s. 20(1) of the Act. This leads to more detailed and practical questions such as the rights of either person or their counsel to be present throughout the inquiry and the rights of their counsel to cross‑examine witnesses and to call and examine other witnesses.
44. The statutory provision (s. 20(1)) is terse. The words critical to this appeal are "to be represented by counsel". How should a court properly interpret those words in the context of the Act? They reached the statute with a minimum of judicial interpretation but a wealth of historical usage in our jurisprudence.
45. The institution of the counsel has been a part of our legal system for at least seven centuries. The practice and later the right to counsel carried with it the right of the litigant to speak to the courts through counsel but not necessarily to be bound (in contrast to the ancient attorney) by what counsel says on behalf of the litigant. See Pollock and Maitland, The History of English Law, vol. 1, 2nd ed., at p. 212. By the late 1200's in the reign of Edward I the counsellor, by a variety of names and titles, attained the first stage of professional recognition sometimes referred to as narrators, countors, serjeants‑at‑law, apprentices, advocates and eventually barristers. From 1292 the courts began to appoint with royal authority these professional spokesmen for litigants, who would serve the monarch and the people in the courts of the land with a status later described as an "officer of the court". The early texts make a distinction between the attorney or solicitor who "represents" and stands in the place of their client; and the counsellor who speaks on behalf of a litigant but in the presence of that litigant or the litigant's attorney. This gradual evolutionary process of the litigant's spokesman, the counsellor, is easy to discern in our legal history; but the rights and duties of the counsellor have evaded precise classification.
46. In return for the exclusive professional right of representation there arose in the counsel duties owed to both the clients and the tribunal. These duties developed in the traditional courtrooms, both criminal and civil. All this in the modern era is succinctly described in Halsbury's Laws of England, vol. 3, 4th ed., p. 619, para. 1137:
A barrister has a duty to his client fearlessly to raise every issue, advance every argument and ask every question, however distasteful, which he properly may and which he thinks will help his client's case, without regard to any unpleasant consequences to himself or any other person. In the interests of the administration of justice, however, a barrister has an overriding duty to the court, to the standards of his profession and to the public. Thus, he must not knowingly mislead the court; this duty prevails over that he owes to his client.
47. To reach the territory of this appeal we must determine the position of counsel in a setting not traditionally known as curial but not entirely informal either. The law in this country relating to the rights of parties to participate in proceedings outside the traditional court and the modes of such participation has passed through three basic stages. In the first stage, which extended to about 1975, the courts, in determining the extent of the rights and obligations of counsel, were concerned with the nature of the tribunal and the proceeding in question. The second stage began with the introduction of the doctrine of "fairness" to the common law culminating in the decision in this court in Nicholson v. Haldimand‑Norfolk Regional Board of Commissioners of Police, [1979] 1 S.C.R. 311. The third stage opened with the Canadian Charter of Rights and Freedoms in 1982. In all these stages the right of a person to attend or participate in a hearing, to have counsel in attendance, and the rights or role of counsel are all mingled and generally treated by the courts as raising the same principles in law.
48. In the "pre‑fairness" era these rights to appear and to have counsel turned upon the classification in law of the tribunal or proceeding in question. If the body was "adjudicative" in nature these rights were more extensively recognized than where the process was "investigative". The process of classification created arbitrary distinctions. Sometimes the yardstick was the availability of the prerogative writ for the review of the proceeding in question. If the tribunal had no authority to pronounce judgment or impose legal obligations, and the tribunal was established within the jurisdiction of the appointing authority, the proceeding was classified as investigative. (See Godson v. City of Toronto (1890), 18 S.C.R. 36, even though the county judge there conducting the inquiry was directed to determine if the city had been defrauded by a named party and others unidentified or by any persons having contracts with the city.) This rule came under scrutiny when the Court was concerned with the rights of a person being investigated in an inquiry under provincial securities regulations which was held in private. By reason of the investigative nature of the inquiry, the corporations whose officers were being investigated had no right to notice or to attend or to cross‑examine witnesses who gave evidence which was potentially against the interests of such persons (St. John v. Fraser, [1935] S.C.R. 441). The issue was the right of counsel for such persons to cross‑examine other witnesses appearing during the investigation. Counsel had every opportunity to attend and to take part in the examination of his client by the inquiry. In denying the application for an injunction against the inquiring officer, Crocket J. stated at p. 445:
Unless by virtue of other provisions of the statute it can properly be held that the investigation was a judicial or quasi‑judicial proceeding and that the opportunity of cross‑examining any witness examined by the investigator on matters affecting the appellants' status or reputation was such an essential requirement in the conduct of the investigation as went to the investigator's jurisdiction to proceed with it, section 29 clearly constitutes an insuperable barrier to the appellants' claim, as held by Mr. Justice McPhillips.
Crocket J. concluded, at p. 445, that upon a consideration of all the sections of the statute bearing on this issue there was no other reasonable inference to be drawn than that the legislature never intended that any notice should be given to "any and every person whose status or reputation might be affected thereby of the examination of any other witness or witnesses and that any and all such persons should be afforded the privilege of cross‑examining any such witness or witnesses".
49. Davis J. agreed in the result but disposed of the issue on a different basis. He found, after an examination of the statute as a whole, that the investigator was essentially an administrative officer operating machinery set up in the statute to collect information and to inquire as to whether or not certain fraudulent practices had been carried on. The statute did not set the investigator up as a court of law. He was clearly established as an administrative body. Counsel for the witness being examined took the position that denial of the witness' right through counsel to cross‑examine all the other witnesses heard by the investigator was contrary to natural justice. Davis J. rejected this argument on the basis of his interpretation of the statute as establishing an administrative tribunal dedicated to the assembly of facts through an inquiry but not to the adjudication of a lis inter partes. He observed at p. 452: "It means that the tribunal while exercising administrative functions must act `judicially' in the sense that it must act fairly and impartially", but that did not give those under investigation the right to cross‑examine other witnesses. All these observations were founded upon the earlier natural justice decisions in the House of Lords in Board of Education v. Rice, [1911] A.C. 179, at p. 182; and Local Government Board v. Arlidge, [1915] A.C. 120, at p. 138, and in the Privy Council in Wilson v. Esquimalt and Nanaimo Railway Co., [1922] 1 A.C. 202. The statement of the principles of natural justice applicable to the administrative process generally is aptly put by Lord Loreburne in Board of Education v. Rice, supra, at p. 182:
They [the administrative agency] can obtain information in any way they think best, always giving a fair opportunity to those who are parties in the controversy for correcting or contradicting any relevant statement prejudicial to their view.
and per Lord Haldane in Arlidge, supra, at p. 132:
...what the procedure is to be in detail must depend on the nature of the tribunal.
50. The judicial tool was review by writ of certiorari which was limited in its reach to inferior tribunals which had the duty and authority to determine or affect rights and thereby were required to act judicially, that is to apply the principles of natural justice. Thus the right to counsel and the rights of counsel are principally discussed by courts sitting in review of statutory tribunals which come under review by certiorari.
51. The same result was reached where the Court considered the right of a person to attend with counsel an inquiry into his affairs and those of a number of other persons, under the Income Tax Act, R.S.C. 1952, c. 148, conducted by a nominee of the Minister of National Revenue. This Court concluded that the process was a private investigation, "a purely administrative matter", which could not decide or adjudicate anything. In Guay v. Lafleur, [1965] S.C.R. 12, Abbott J., writing for the majority, found, at p. 17, that the inquiry power was one of a number of similar powers granted in the Act to enable the Minister:
...to obtain the facts which he considers necessary to enable him to discharge the duty imposed on him of assessing and collecting the taxes payable under the Act. The taxpayer's right is not affected until an assessment is made. Then all the appeal provisions mentioned in the Act are open to him.
The fact that a person authorized to make an investigation on behalf of the Minister is given certain limited powers of compelling witnesses to attend before him and testify under oath, does not, in my opinion, change the nature of the enquiry.
The majority followed the general line of Arlidge and of Rice, supra, (though without citation) and adopted the words of Hyde J. in the court below, at p. 17:
...it is not for the Courts to specify how that inquiry is to be conducted except to the extent, if any, that the subject's rights are denied him.
Cartwright J. (as he then was) adopted the reasons of Abbott J., adding that the maxim audi alteram partem did apply to administrative bodies but only where such bodies have the power to give a decision which affects rights or imposes liabilities on others. In Lafleur only the Minister, and not the inquiry officer, could assess and collect taxes. Spence J. concurred in the majority result and expressly adopted the reasoning of this Court in St. John, supra, both on the basis advanced by Crocket J. and that by Davis J. Spence J. concluded, at p. 23:
However, even if the respondent were to confine his demand to a simple right to be present in person and with counsel during such examination, in my view, to give effect to that demand would be for the judiciary to attempt to impose its own methods on an administrative officer and, with respect, I am of the opinion that Davis J. rightly held that the judiciary should not make such an attempt. The fact that the investigator is bound to act judicially in the sense of being fair and impartial does not require the investigator to permit the respondent and his counsel to be present during every examination carried on by virtue of the authorization of the Deputy Minister whether or not such counsel were to attempt to cross‑examine such witnesses.
Hall J. dissented, taking the point of the majority in the court below that as the investigator was in law bound to "act judicially in the sense that he must act fairly and impartially", the person whose affairs were being investigated was entitled to attend the sittings and to be represented by counsel. This Court in Lafleur thus reaffirmed the principles established in St. John.
52. Instances where courts have interfered with administrative bodies, including application to those bodies of the principle of audi alteram partem, may be found in Saulnier v. Quebec Police Commission, [1976] 1 S.C.R. 572, per Pigeon J. at p. 578, which authority he further discussed in Martineau v. Matsqui Institution Inmate Disciplinary Board (No. 1), [1978] 1 S.C.R. 118, at p. 131; and Re Nanticoke Ratepayers Association and Environmental Assessment Board (1978), 83 D.L.R. (3d) 722 (Ont. H.C.) In the pre‑Nicholson era a number of authorities shifted the emphasis away from a process of classification of the tribunal in question to the effect of the statutory procedure on the individual appearing in the administrative process. See Re McGavin Toastmaster Ltd. and Powlowski (1972), 31 D.L.R. (3d) 370, and (1973), 37 D.L.R. (3d) 100 (Man. C.A.); Ryan v. Board of Inquiry under the Human Rights Act (1976), 22 N.S.R. (2d) 444; Desjardins v. Bouchard (1976), 71 D.L.R. (3d) 491; Chisholm v. Jamieson, [1974] 6 W.W.R. 169; Re Sedlmayr, Gardiner and Demay and the Royal Commission into the Activities of Royal American Shows Inc. (1978), 82 D.L.R. (3d) 161; and Re Underwood McLellan & Associates Ltd. and Association of Professional Engineers of Saskatchewan (1978), 86 D.L.R. (3d) 501, reversed on other grounds (1979), 103 D.L.R. (3d) 268 (Sask. C.A.)
53. In the United Kingdom, the emerging requirement to "act fairly", even in a purely investigatory process where the principles of judicial review and of natural justice had not theretofore been applied, can be followed in In re Pergamon Press Ltd., [1971] Ch. 388, per Denning M.R. at p. 399, and Selvarajan v. Race Relations Board, [1976] 1 All E.R. 12, per Lord Denning at p. 19. Both of these cases are quite different on the facts from those with which the Court is concerned on this appeal. The actual investigator in these cases was the statutory authority which alone determined the use to be made of the material uncovered in the investigation. The shift in principle which has evolved is significant, as Sachs L.J. said in Pergamon, supra, at pp. 402‑03:
To come to that conclusion it is, as recent decisions have shown, not necessary to label the proceedings "judicial," "quasi‑judicial," "administrative" or "investigatory": it is the characteristics of the proceeding that matter, not the precise compartment or compartments into which it falls‑‑and one of the principal characteristics of the proceedings under consideration is to be found in the inspectors' duty, in their statutory fact‑finding capacity, to produce a report which may be made public and may thus cause severe injury to an individual by its findings.
54. Lord Denning put into summary form the evolving duty of the investigator when he stated in the Selvarajan appeal, supra, at p. 19:
In all these cases it has been held that the investigating body is under a duty to act fairly; but that which fairness requires depends on the nature of the investigation and the consequences which it may have on persons affected by it. The fundamental rule is that, if a person may be subjected to pains or penalties, or be exposed to prosecution or proceedings, or deprived of remedies or redress, or in some such way adversely affected by the investigation and report, then he should be told the case made against him and be afforded a fair opportunity of answering it. The investigating body is, however, the master of its own procedure. It need not hold a hearing. It can do everything in writing. It need not allow lawyers. [Emphasis added.]
55. In Selvarajan the officer assigned by the Board to investigate on its behalf, in making her report prejudged the case by her own admission and did so without awaiting a response by the person being investigated. In her report to the Board she recommended against the complainant. The Board then reached the same conclusion as did the staff member in her report. The Board's decision was not disturbed by the Court notwithstanding the statement by the Court of Appeal that the officer's conduct was "unfortunate" and a "mistake" both in the prejudgment of the merits and in the making of recommendations to the Board who by statute had to make the decision.
56. This Court met the issue of "fairness" squarely in Nicholson, supra. In those proceedings the Court, as was the House of Lords in Ridge v. Baldwin, [1964] A.C. 40, was dealing with the termination of services of a policeman by a public authority. The statute in question did not impose any procedure upon the employing agency, nor did it require the assignment of any reasons for the action of termination where such took place within eighteen months of engagement. Making note that the Court in Ridge v. Baldwin, supra, had applied the principles and requirements of natural justice to a body acting pursuant to a statute, Laskin C.J., in giving reasons for the majority quoted from the judgment of Lord Reid to illustrate how the House of Lords extended the maxim of audi alteram partem by implication:
The present case is in my opinion just such a case where there are strong indications that a right to be heard, in appropriate circumstances, should not be denied.
(Laskin C.J. citing from a commentary on Lord Reid in Ridge v. Baldwin, supra, by Lord Wilberforce in Malloch v. Aberdeen Corp., [1971] 2 All E.R. 1278, at p. 1295, at p. 324 of Nicholson.) From there the Chief Justice moved on to the statement of Megarry J. in Bates v. Lord Hailsham, [1972] 1 W.L.R. 1373, at p. 1378 where the lesser standard of fairness was extended to the administrative field "that in the sphere of so‑called quasi‑judicial the rules of natural justice run, and that in the administrative or executive field there is a general duty of fairness" (p. 324). In both instances access by the courts to the administrative tribunal was through the writ of certiorari applied on the theory that acting in violation of the principle of fairness, read into the statute in question by implication, was a breach of jurisdiction by the administrative agency, a creature of statute. See also Pearlberg v. Varty, [1972] 1 W.L.R. 534, at p. 537: "... as `Parliament is not to be presumed to act unfairly,' the courts may be able in suitable cases (perhaps always) to imply an obligation to act with fairness" (per Lord Pearson at p. 547, cited at p. 326 of Nicholson). This Court applied the duty of fairness to the police board and found that the law required the board to afford the policeman the right to make his case to the board, orally or in writing as the Board may determine, before the police board reached its conclusion with reference to the termination of the policeman's employment. The decision of the board once taken would be unassailable, given "good faith" (at p. 328). It should be noted that Laskin C.J. acknowledged, at p. 326, that the decision in issue must be "a final determination of his rights". In this appeal the proceeding before the Hearing Officer determined no rights, imposed no liabilities, was conducted in private, and at most would lead to a statement of evidence (not to be published) to the Commission.
57. In all these decisions in the United Kingdom, supra, and in Nicholson, supra, it is the administrative body which is brought under the principle. Staff and other agents of the authority are not considered to be a "body or authority" subject to compliance with the doctrine of fairness. This may be so because the rights of the individual are affected in a final determinative sense only when the agency acts on the result of the staff investigation. As Lord Denning said in Selvarajan, supra, at p. 19:
It can employ secretaries and assistants to do all the preliminary work and leave much to them. But, in the end, the investigating body itself must come to its own decision and make its own report.
Laskin C.J., in Nicholson, supra, stated at p. 328:
The present case is one where the consequences to the appellant are serious indeed in respect of his wish to continue in a public office, and yet the respondent Board has thought it fit and has asserted a legal right to dispense with his services without any indication to him of why he was deemed unsuitable to continue to hold it.
58. The proper scope of the "fairness" principle was reviewed by this Court in the context of a statutory appeal to the Governor General in Council, in Attorney General of Canada v. Inuit Tapirisat of Canada, [1980] 2 S.C.R. 735. In a unanimous judgment, the Court stated at p. 750:
While, after Nicholson, supra, and Martineau v. Matsqui Institution (No. 2), [1981] S.C.R. 602, ... the existence of such a duty no longer depends on classifying the power involved as "administrative" or "quasi‑judicial", it is still necessary to examine closely the statutory provisions in question in order to discern whether it makes the decision‑maker subject to any rules of procedural fairness.
The process of discerning the propriety of the application of the principle was again discussed at p. 755 where the Court stated:
While it is true that a duty to observe procedural fairness, as expressed in the maxim audi alteram partem, need not be express (Alliance des Professeurs Catholiques de Montréal v. Commission des Relations Ouvrières de la Province de Québec), it will not be implied in every case. It is always a question of construing the statutory scheme as a whole in order to see to what degree, if any, the legislator intended the principle to apply.
The judgment continued at p. 758:
The answer is not to be found in continuing the search for words that will clearly and invariably differentiate between judicial and administrative on the one hand, or administrative and legislative on the other. It may be said that the use of the fairness principle as in Nicholson, supra, will obviate the need for the distinction in instances where the tribunal or agency is discharging a function with reference to something akin to a lis or where the agency may be described as an `investigating body' as in the Selvarajan case, supra.
59. This Court returned to the examination of the development of the principle of "procedural fairness" in Innisfil (Corporation of the Township) v. Corporation of the Township of Vespra, [1981] 2 S.C.R. 145, where in a unanimous judgment it was stated, at pp. 170‑71:
Gradually the principle of judicial surveillance through the application of the rules of natural justice to the administrative tribunals was extended to the administrative function. By this time the expression "the duty to act fairly" had been added to the judicial vocabulary (B. Johnson & Co. (Builders), Ltd. v. Minister of Health, [1947] 2 All E.R. 395), with reference to quasi‑judicial functions. The extension of the principle of natural justice by the courts finally reached the purely administrative act in Ridge v. Baldwin, [1964] A.C. 40, and by 1967 in Re H.K., [1967] 2 Q.B. 617, Lord Parker concluded that the classification of the particular function of the tribunal under review did not determine the judicial duty to intervene for the protection of the rights of a party to the proceeding. In this Court the development continued with the application of the doctrine of `procedural fairness' in Nicholson v. Haldimand‑Norfolk Regional Board of Commissioners of Police, [1979] 1 S.C.R. 311, to an administrative action not involving the formal functioning of an administrative tribunal or the protection of a defined statutory right. Sometimes the right to procedural fairness moved into "the right to know the case against the party" as in R. v. Gaming Board for Great Britain, Ex parte Benaim and Khaida, [1970] 2 Q.B. 417, and sometimes the test seems to revert to the days of the Cooper case, supra, where the Legislature may or may not have prescribed the procedures to be followed by the administrative tribunal. Even then Lord Wilberforce in Wiseman v. Borneman, [1971] A.C. 297, concluded, at p. 317:
It is necessary to look at the procedure in its setting and ask the question whether it operates unfairly to the taxpayer to a point where the courts must supply the legislative omission.
60. A very helpful review of all these authorities may be found in the judgment of Arnup J.A. in Re Abel and Advisory Review Board (1980), 119 D.L.R. (3d) 101 (Ont. C.A.), where again the Court was concerned with a report by an administrative agency authorized and directed by statute to review certain matters and to report thereon with its recommendations to the Lieutenant Governor in Council. In reality, the liberty of the applicant was directly affected by the report and the recommendation of the administrative board and hence the Court found a duty in the board to act fairly in making such report and such recommendations.
61. For the continued application of the principle of the duty of the administrative authority to act fairly, in the courts of the United Kingdom, see Bushnell v. Secretary of State for the Environment, [1980] 2 All E.R. 608 (H.L.); Mahon v. Air New Zealand Ltd., [1984] 3 All E.R. 201 (P.C.); and in New Zealand in Re Royal Commission on Thomas Case, [1980] 1 N.Z.L.R. 602 (H.C., Full Court). The application of the doctrine of procedural fairness in this country can be seen in Re Boehler and College of Nurses of Ontario (1982), 133 D.L.R. (3d) 642 (Ont. Div. Ct.); Re Seaway Trust Co. and The Queen in Right of Ontario (No. 2) (1983), 143 D.L.R. (3d) 252 (Ont. H.C.); and Fraternité inter‑provinciale des ouvriers en electricité v. Office de la construction du Québec, [1983] C.A. 7, 148 D.L.R. (3d) 626.
62. Before returning to the terms of the statute here in question it is helpful to refer to a similar trend in the United States courts in applying the due process provisions of the Fourteenth Amendment to administrative law. The position in the United States federal law would seem to be that the right to and role of counsel before an administrative agency turns on the nature of the power exercised by the agency. These powers have been broadly grouped into legislative, investigative and adjudicatory categories. The United States' decisions emphasize the same distinctions apparent in the Canadian authorities such as St. John and Guay v. Lafleur, supra.
63. The old and traditional rule was crystallized by the Supreme Court in Jones v. S.E.C., 298 U.S. 1 (1936). It simply condemned as contrary to the rule of law in general and the Constitution in particular a "general, roving, offensive, inquisitorial, compulsory investigation, conducted by a commission without any allegations, upon no fixed principles, and governed by no rules of law . . . . "
64. In a series of cases culminating in Hannah v. Larche, 363 U.S. 420 (1959), the United States Supreme Court held that no due process rights attach in a purely investigatory proceeding. (See In re Groban, 352 U.S. 330 (1957); and Anonymous No. 6 v. Baker, 360 U.S. 287 (1959).) By 1969, the Court recognized that a fact‑finding commission which investigated violations of state and federal law in the labour‑management field and exercised a function "very much akin to making an official adjudication of criminal culpability" (at p. 427) would be subject to rights to counsel and cross‑examination by counsel under the Fourteenth Amendment (Jenkins v. McKeithen, 395 U.S. 411 (1969)). Since that time the authorities have by no means been consistent (see Genuine Parts Co. v. F.T.C., 445 F.2d 1382 (5th Cir. 1971); Sneaker Circus Inc. v. Carter, 457 F.Supp. 771 (1978), aff'd 614 F.2d 1290 (1979); and Georator Corp. v. Equal Employment Opportunity Commission, 592 F.2d 765 (4th Cir. 1979).
65. It would appear that the due process provisions in the U.S. Bill of Rights introduced the doctrine of procedural fairness in direct proportion to the consequences of the investigative‑administrative process in question. It is fair to say that the presence of and limitations on the doctrine of procedural fairness as it relates to investigative activities are not dissimilar to those described in Pergamon and Selvarajan, supra, in the United Kingdom. Indeed an interesting comparative pattern develops between Pergamon and Selvarajan in the courts of the United Kingdom and Hannah and Jenkins, supra, in the Supreme Court of the United States.
66. In Pergamon, supra, the investigative body was found to be subject to the principle of procedural fairness. The public investigator by statute had to make a report to the Board of Trade of the United Kingdom government, in which findings of fact and accusations could be made, and could also communicate to the Board of Trade facts which were believed to indicate an offence had been committed. The Board, on receiving the investigator's report, could publish it. There was no subsequent investigation or procedure undertaken by the recipient Board of Trade. The investigation report was apparently the basis for subsequent decisions to prosecute criminally or to institute actions civilly, or to wind up the company which had been investigated. The Court found a duty to act fairly although the investigator was acting in a purely administrative function and not judicially as a quasi‑judicial body. If an individual could be adversely affected by the investigation and report, that individual must be told the case against him and given a fair opportunity to answer. This requirement had been met on the facts of the case.
67. Selvarajan, supra, is to the same effect. In that case the court found no unfairness on the facts as the administrative body had directed that the investigations in question be undertaken by the authority's staff or divisions. The administrative body then received, considered, and acted upon the investigator's report. After the report was made known to the individual investigated, the public authority then reached its conclusion. The Court held that the Board was subject to a duty to act fairly but that this did not mean that every member of the committee had to see all the papers. As long as the Board had enough information to make a fair assessment of the case, the courts should not interfere. It was up to the Board to decide how best to exercise its functions. As we have seen, the Court went on to describe the informality of the investigatory process, including "it need not allow lawyers". The direct consequences of the investigator's report, including its impact on the individual under investigation, rather than the nature of the investigating tribunal, became the dominant criterion. Each case turned on the statutory provisions and the particular facts and circumstances of the case.
68. In Hannah, supra, the principle was laid down that due process rights did not generally adhere to purely investigative bodies, otherwise acting within their statutory mandate, and consequently the Court did not intervene. The majority of the Court stated at p. 442: "The nature of the alleged right involved, the nature of the proceeding, and the possible burden on that proceeding, are all considerations which must be taken into account ..." when determining the applicability of the principles of due process under the Fourteenth Amendment. The majority judgment written by Warren C.J. also added at p. 449: "...the grand jury merely investigates and reports. It does not try," and accordingly, due process does not attach. (See comments on Hannah, supra, in Ernest H. Schopler, "Right to Assistance by Counsel in Administrative Proceedings" (1970), 33 ALR3d 229, at pp. 249‑56.)
69. In Jenkins, supra, however, the Supreme Court applied the due process requirements of the Fourteenth Amendment to an investigative agency which was required to make "public findings, whether there is probable cause to believe violations of the criminal laws have occurred", to report such findings to law enforcement agencies and to request that the executive branch refer the matter to the Attorney General for prosecution. Only a limited statutory right of cross‑examination was granted by the legislation. Neither witnesses nor persons being investigated had the right to call witnesses before the inquiry. The statute provided:
In no event shall counsel for any witness have any right to examine or cross‑examine any other witness but he may submit to the commission proposed questions to be asked of any other witness appearing before the commission, and the commission shall ask the witness such of the questions as it deems to be appropriate to its inquiry.
70. While Hannah, supra, was confirmed, the Commission of Inquiry, in the words of Marshall J., writing for the majority of the court in Jenkins at p. 416: "... is required to determine, in public findings, whether there is probable cause to believe violations of the criminal laws have occurred," and accordingly the principles of Hannah were found to be inapplicable. As a result, due process requirements were imposed by the court. Marshall J. went on to state at p. 427:
In our view, however, the Commission in the present case differs in a substantial respect from the Civil Rights Commission and the other examples cited by the Court in Hannah.... the Commission does not adjudicate in the sense that a court does, nor does the Commission conduct, strictly speaking, a criminal proceeding. Nevertheless, the Act, when analyzed in light of the allegations of the complaint, makes it clear that the Commission exercises a function very much akin to making an official adjudication of criminal culpability.
and again at p. 429: "... that due process requires the Commission to afford a person being investigated the right to confront and cross‑examine the witnesses against him, subject only to traditional limitations on those rights"; and at p. 431 added: "In addition, the alleged function of the Commission is to make specific findings of guilt, not merely to investigate and recommend". It would appear that a statute which only requires the investigatory authority to make recommendations in its report (as distinct from findings of misconduct) would not attract the due process requirements of the Fourteenth Amendment.
71. It should be noted that Harlan J., writing in dissent for himself and two other members of the Court in Jenkins at p. 439, would have excluded the Commission from the due process requirement: "The Commission has no authority to adjudicate a person's guilt or innocence, and its recommendations and findings have no legal consequences whatsoever," and later added, at p. 441:
... it has not been seriously suggested that a "person under investigation" by a district attorney has any of the "adjudicative" constitutional rights at the investigative stage. These rights attach only after formal proceedings have been initiated.
He then reminded the majority, at pp. 442‑43:
Before the Court holds that a purely investigatory agency must adopt the full roster of adjudicative safeguards, however, it would do well to heed carefully its own warning in Hannah, that such a requirement "would make a shambles of the investigation and stifle the agency in its gathering of facts."
72. The judgments of the courts of the United Kingdom and the United States sound the same cautions. Neither jurisdiction appears to have produced a rule or gauge of easy application to determine when "fairness" or "due process" should apply to an administrative authority not subject (at least in the U.K. law) to the full force of the principles of natural justice, when acting in a purely administrative function. Each jurisdiction may bring an investigatory function within the fairness standard depending on the type and nature of the investigation, the nature of the right involved, the possible burden on the process and, most importantly, whether the particular investigation process exposes the person being investigated to prosecution, publication and serious adverse findings or other loss or damage.
73. As we have seen, s. 20(1) of the Act provides both a qualified and an unqualified right to counsel. The section provides no guide to the administrative agency or the courts for its implementation and application. A remarkably similar provision appears in the United States Administrative Procedure Act, 5 U.S.C.A., § 555(b):
§ 555. ...
(b) A person compelled to appear in person before an agency or representative thereof is entitled to be accompanied, represented, and advised by counsel or, if permitted by the agency, by other qualified representative.
The Court of Appeals, 9th Circuit, examined this provision in F.C.C. v. Schreiber, 329 F.2d 517 (1964). The trial court had found no right in counsel to cross‑examine other witnesses in a purely investigatory proceeding and this issue was not appealed by the parties. The majority of the Court concluded that the investigating commission had the authority to prohibit counsel from objecting to questions put by the Commission and from arguing objections on the record. The majority of the court stated through Foley D.J., at p. 526:
We hold that the word "represented" must be read in light of the Due Process Clause of the Fifth Amendment and therefore varies in meaning depending upon the nature of the function being exercised. While counsel may, as a matter of right, object and argue objections on the record, just as he may, as a matter of right, cross‑examine and call witnesses in a trial‑type, adjudicatory proceeding, these rights do not exist in the fact‑finding, nonadjudicative investigation unless specifically provided by statute or duly promulgated rules. The right to object and argue objections on the record is not to be implied, here, from the use of the word "represented" in Section 6(a).
Browning C.J. dissented, at pp. 537‑38:
Precisely what the right to be "represented *t<s*t<s*t<s by counsel" comprehends may depend to some extent upon the nature of the inquiry, and other surrounding circumstances, but it cannot reasonably import less, as to a witness in an investigative proceeding, than the right to have counsel object to questions put to the witness and state his reasons in the record.
74. It was conceded by all the parties in Schreiber that witnesses before purely investigative bodies have no constitutional right to the aid of counsel. It should be said of this authority that the administrative body, the Federal Communications Commission, was there engaged in an investigation leading to rule‑making legislative action by the Commission and not in the licensing or licence discipline regulatory function of the Commission.
75. Much discussion has occurred in the courts and the law journals in the United States about the practice of conducting investigations in private either by reason of statutory or regulatory requirement. At one time condemned as a "Star Chamber" practice, recourse to that procedure is now frequently sought by the person under investigation and is generally opposed by the regulatory agency who seeks by public inquiry to promote the flow of information and to increase the accuracy of information so uncovered. (See: "The Distinction Between Informing and Prosecutorial Investigations: A Functional Justification for `Star Chamber' Proceedings" ((1963), 72 Yale L.J. 1227.) The stigma of public investigation, which ends in findings of conduct generally attracting opprobrium, has been seen in the United Kingdom and the United States courts as an important factor in determining the application of its procedural fairness principles and the right to and the role of counsel in such proceedings. In these proceedings the stage of public disclosure and participation has not been reached.
76. In Canada some litigation has been directed towards judicial surveillance of administrative investigatory procedures largely in the field of commissions of inquiry. Where those inquiries are created under a statute such as The Public Inquiries Act of Ontario, the decisions of the commission of inquiry are exposed to attack in the courts where statutory jurisdiction has been granted to pass upon the validity of any decision or order of the commissioner. Under this authority the courts have intervened and substituted their view of the proper exercise of discretion for that of the commissioner: see Re The Ontario Crime Commission, Ex parte Feeley and McDermott, [1962] O.R. 872; Public Inquiries Act and Shulman, Re, [1967] 2 O.R. 375; and Re Children's Aid Society of the County of York, [1934] O.W.N. 418. In the words of Schroeder J.A. in Feeley, supra, s. 5(1) of The Public Inquiries Act, R.S.O. 1960, c. 323, providing as it does for a stated case to the Court of Appeal, is "unique" and this no doubt explains the action taken by the Court of Appeal in the above decisions. Acting under this authority the Court has, for example in Children's Aid Society, supra, observed that "... everyone should have the right to cross‑examine any witness whom he believes to be in error or to be suppressing facts", per Riddell J.A., at p. 420. Middleton J.A. added, at p. 421, that "the fullest right to cross‑examine should be permitted". In Feeley, the Commissioner had denied the right of counsel representing persons identified in the terms of reference of the inquiry from cross‑examining witnesses. There was no debate on the issue as to whether such parties are a "person affected" in the words of The Public Inquiries Act. The Court overturned the Commissioner and concluded that such counsel was entitled to call witnesses and to examine them in chief; was entitled to cross‑examine witnesses called by commission counsel or any other person where the evidence was against the interests of counsel's client; and was entitled to obtain a transcript of testimony taken in camera. In reaching these conclusions the Court of Appeal relied upon St. John, supra. Writing on behalf of the majority (himself and Aylesworth J.A.), Schroeder J.A. stated, at p. 896:
In the present inquiry, allegations of a very grave character have been made against the applicants, imputing to them the commission of very serious crimes. It is true that they are not being tried by the Commissioner, but their alleged misconduct has come under the full glare of publicity, and it is only fair and just that they should be afforded an opportunity to call evidence, to elicit facts by examination and cross‑examination of witnesses and thus be enabled to place before the commission of inquiry a complete picture rather than incur the risk of its obtaining only a partial or distorted one. is a right to which they are, in my view, fairly and reasonably entitled and it should not be denied them.
77. In light of the important factual and legal differences between a public inquiry held under The Public Inquiries Act and an investigative inquiry which in the present case is held completely in private, and which generally do not lead in a systematic way to prejudice, prosecution or deprivation, the public inquiry cases are of little use in resolving the issues now before us.
78. It follows from the above discussion that neither s. 20(1) of the Act nor the doctrine of fairness provides the appellants with a right to cross‑examine witnesses at the inquiry. Fairness is a flexible concept and its content varies depending on the nature of the inquiry and the consequences for the individuals involved. The characteristics of the proceeding, the nature of the resulting report and its circulation to the public, and the penalties which will result when events succeeding the report are put in train will determine the extent of the right to counsel and, where counsel is authorized by statute without further directive, the role of such counsel. The investigating body must control its own procedure. When that body has determinative powers, different considerations enter the process. The case against the investigated must be made known to him. This is provided for in the Act at each of the progressive stages of the inquiry.
79. The appellants argue that the consequential impact of the reduced scope of counsel activity allowed by the Hearing Officer will result in a loss of reputation, exposure to criminal prosecution, reduction of freedom to compete with others by reason of loss of protection under existing custom tariffs, and the exposure to adverse action by other federal agencies who may receive representations from the Director. This argument founders on prematurity in fact and under the provisions of the Act as well. Any loss of reputation, or the right to maintain a good reputation in the community, will be largely and probably entirely dependent on the publication of the transcript of evidence taken before the Hearing Officer. This the Hearing Officer may not bring about. Such a loss or prejudice might be suffered by an appellant if the Director published a report on the evidence gathered in his investigation. The statute, however, does not require a report from the Director but only a statement of evidence under s. 18. This statement is not published but is delivered by the Director only to the persons against whom an allegation is therein made, and to the Commission. The Commission thereafter is required to consider the statement as well as "other evidence or material" as the Commission considers advisable (s. 18(3)), and shall make a report to the Minister. Where the report is made "against any person" the Commission shall make no such report unless such person has been allowed "full opportunity to be heard in person or by counsel" (subs.(2)). Thus subsections (2) through (4) of s. 18 largely offset any hardship incurred by the denial of cross‑examination at this preliminary stage before the Hearing Officer. Any "recommendations" or "findings" which reach the Minister as a result of this lengthy and tiered process shall be those of the Commission and not of the Hearing Officer or of the Director (s. 19(2)). This is the first report or statement that shall be made public unless the Commission and the Minister decide publication should be withheld. None of these potential developments has yet been realized in the stage that the statutory process has reached in these proceedings. We are engaged only in the first stage of information gathering.
80. There are two other steps which the Director may take or may be called upon to take. Section 15 authorizes a Director to remit any records or evidence to the Attorney General of Canada "for consideration as to whether an offence has been or is about to be committed ... and for such action as the Attorney General may be pleased to take". By section 15(1) and (2), the Attorney General alone may consider whether an offence has been committed and whether any action including prosecution shall be taken. Should the Attorney General determine that an offence has been committed, the statute requires that he institute and conduct any such prosecution. The Director's role in this section is clearly of a purely investigatory nature and entirely preliminary to any action which might adversely affect any person.
81. If an individual is prosecuted criminally, s. 20(2) of the Act prevents testimony he gave at the hearing from being used against him at trial. Section 643 of the Criminal Code, R.S.C. 1970, c. C‑34, may have some relevance with regard to the testimony given by other witnesses before the Hearing Officer. Through that provision evidence taken by the Hearing Officer might conceivably find its way into a criminal process under the Code. The exception to the hearsay rule enacted by s. 643, however, would not permit the use of such evidence where the accused, against whom the evidence might be used, did not have a full opportunity to cross‑examine.
82. By section 26 the Minister may require the Director to submit an interim report to the Minister in which the Director shall set out "the evidence obtained and the Director's opinion as to the effect of the evidence". The matter stops there. The statute neither directs nor authorizes the Minister to take any further action. In particular there is no provision for the publication of the interim report by either the Director or the Minister. There is no provision for the laying or prosecution of charges by the Minister.
83. In all these steps up the flight of investigatory stairs, all these inquiries must by s. 27 be held in private. The Director and the Hearing Officer have no authority to conduct an inquiry otherwise. The Commission may decide to hold in public all or part of an inquiry conducted by the Commission. Section 27(2) indicates a distinction between "an inquiry before the Commission" and "other proceedings before the Commission". We are not, in any case, concerned at this stage of the process with any action which the Commission might or might not hereinafter take.
84. The position of the appellants is substantially the same as though the investigative process had been undertaken by the traditional police inquiry followed by a preliminary hearing, except for the possibility that evidence taken under s. 17 might not be subjected to cross‑examination until the stage of a Commission hearing. Even that circumstance has long been with us in the criminal process at the inquest stage. Batary v. Attorney General for Saskatchewan, [1965] S.C.R. 465, and Faber v. The Queen, [1976] 2 S.C.R. 9, reaffirm the ancient process whereby persons interested in the inquest proceedings may not themselves examine witnesses but rather are required to put suggested questions to the representative of the Crown. This important step in the investigative process also has adjudicative aspects in the making of findings and recommendations and does so in a public hearing. Nonetheless there is no right in interested or affected parties to cross‑examine witnesses or to lead evidence.
85. In R. v. McDonald, Ex parte Whitelaw (1968), 2 D.L.R. (3d) 298, the British Columbia Court of Appeal held that a person suspected of an offence but not yet charged is a compellable witness at a coroner's inquest. Bull J.A. stated at p. 300:
...a person who is not charged, but who is or may be suspected of, or may be later charged with, a crime or offence is in no different position from any other witness summoned to, or present at, the inquest, and may be compelled to give evidence thereat, subject to such protection with respect to incriminating statements as to which he may be entitled under applicable law.
McFarlane J.A. agreed at p. 312:
No authority, binding or persuasive, has been produced in which it has been decided judicially that the principle expressed in the maxim nemo tenetur seipsum accusare applies so as to exempt a person not charged with any offence from being compellable as a witness at a Coroner's inquest.
86. The inquest has been a part of our criminal process for more than a century and has been a significant institution in the English and Canadian legal history combined for many centuries. Comparatively speaking, the inquest holds out the prospect of jeopardy under the criminal law in a much more significant way than does the investigatory sequence established in Parts I and II of the Act.
87. These proceedings have not reached the stage, in the words of Lord Wilberforce in Wiseman v. Borneman, [1971] A.C. 297, at p. 317, that "it is necessary to look at the procedure in its setting and ask the question whether it operates unfairly to the taxpayer to a point where the courts must supply the legislative omission". Courts must, in the exercise of this discretion, remain alert to the danger of unduly burdening and complicating the law enforcement investigative process. Where that process is in embryonic form engaged in the gathering of the raw material for further consideration, the inclination of the courts is away from intervention. Where, on the other hand, the investigation is conducted by a body seized of powers to determine, in a final sense or in the sense that detrimental impact may be suffered by the individual, the courts are more inclined to intervene. In the present case it was sufficient that the Hearing Officer allowed all the parties to be represented by counsel who could object to improper questioning and re‑examine their clients to clarify the testimony given and to ensure that the full story was communicated by the witness counsel represented.
88. Mr. Weppler, Vice‑President and Secretary‑Treasurer of Drummond McCall Inc. is a potential and likely witness and thus the Hearing Officer had discretion to exclude him from the hearing. By the time he was excluded, Drummond McCall Inc. was represented by counsel. This proceeding is not a trial where a corporation may need a corporate employee to assist counsel representing the corporation. No such right attaches to a purely investigatory process, particularly in the preliminary stage of an elaborate statutory structure where the corporation is represented by counsel.
89. Some of the appellants seek mandamus to compel the Hearing Officer "or such other person as may properly so do to order the re‑attendance of the witness Kirch in order that counsel for the applicants may question him". This remedy is said to arise out of the order issued by the Chairman on an unknown date directing Kirch to appear to give evidence; and his order issued on February 3 appointing the Hearing Officer to receive the evidence of Kirch and others. The Act (s. 17) merely authorizes a Commissioner to appoint "any other person" before whom a person shall appear and be examined upon oath. The statute places no other duty or burden on such appointee other than to preside over the examination of the witness or witnesses named in the order. There is no basis for the operation of a writ of mandamus in respect of the Hearing Officer. He was present and ready to preside over the examination of the witness Kirch. Nothing else is required of the Hearing Officer under the statute.
90. The Director made application to the Chairman of the Commission on January 27, 1981 for an order under s. 17 directing Kirch and others to give evidence under oath before the Hearing Officer Griffin who was designated in the order as "the person before whom such evidence shall be given". Neither s. 17 nor the order of February 3 contain any directive to the Director to examine a witness in a particular manner or on any particular subject. The Director declined to do so because the witness Kirch did not wish to testify in the presence of other parties or witnesses and their respective counsel. The Director must be able to control his investigation process so long as he conforms to the statute. There is no ministerial duty arising in the Director under any statute, regulation or order made thereunder, to examine Kirch in any particular way or at all. (See S. A. de Smith, Judicial Review of Administrative Action (4th ed. 1980), at p. 541.) If a ministerial duty to examine Kirch did arise it could be discharged in a perfunctory way by the Director. Courts historically do not issue orders which may not be enforced, which cannot produce a result of substance or value, or which might entail judicial supervision to ensure enforcement (Barnes v. City of London Real Property Co., [1918] 2 Ch. 18.) There is nothing in the record or in the allegations or submissions of any party before the Court to indicate that the Director has rendered himself incapable of fulfilling any other duty arising in him under the Act, by reason of his declining to examine Kirch. There is therefore no basis upon which the issuance of a mandamus directed against the Director can issue, and no case or submission has been made out for the issuance of a mandamus against the Chairman or any member of the Commission. There is no legal basis enabling this Court to respond to the application for a mandamus or other order compelling the examination of Kirch by the Director in the presence of the Hearing Officer.
91. What then is the position in law of the request by these appellants for an order that Kirch re‑attend for examination under oath by counsel for these appellants? The statute reveals no rights in the appellants to obtain by any means the presence of Kirch before the Hearing Officer. At most a submission can be made that the order of February 3 must be enforced as against Kirch, and that once present before the Hearing Officer counsel other than the Director may put questions to him. Again the statute is silent on any such possibility. Section 17 is founded on an application ex parte by the Director and is not open to any other person. It might be argued that s. 20(1) gives a right to the counsel appearing before the Hearing Officer to examine any witness appearing before that officer but, for reasons already discussed, no such right at large has been found to arise. There would therefore appear to be no basis in the statute or at common law for the issuance of an order which would combine the exclusive right of the Director to obtain the presence of Kirch through an order of the Commission, and a perceived right under s. 20 in someone else to examine the witness so produced. In my view, therefore, this part of the application must likewise be dismissed.
92. The area under investigation concerns trading crimes which by nature are difficult of investigation. Persons conspiring to profit improperly from trade combinations do not create much physical evidence and have every opportunity to disguise their conduct. The impact of the crime on the individuals affected is in each case very small in economic terms but in gross produces sizeable criminal profit. Again this type of crime requires more than the usual combination of informants and complainants from the public at large. The demonstration of the crime generally requires the early and active investigative action by the state itself. An awareness of these concerns by the legislators is apparent when the investigative program established in the Act is read as a whole. The interpretation of the Act in its dying days and of the successor statute will perhaps attract different tests and standards not applicable in these proceedings when the issues then before the courts will have arisen after the advent of the Charter .
Charter Issues
93. Several issues were raised which bring into consideration the application of some of the provisions of the Canadian Charter of Rights and Freedoms to this appeal.
1. The Invalidity of ss. 17 and 20(1) of the Act
94. Section 17 is said by some of the appellants to be invalid by reason of conflict with s. 7 of the Charter because it requires a witness to testify under oath and thus incriminate himself, and with s. 8 of the Charter because it directs the production of documents without any demonstration of reasonable grounds for the order. Section 20(1) is said by some of the appellants to be invalid by reason of a discretion in the Commission to deny counsel to persons whose conduct is being inquired into.
95. The appellants made application to the Chief Justice of this Court for an order under Rule 32, Supreme Court Rules, as it then stood [SOR/83‑74], for the stating of a question as to the constitutional validity or applicability of these sections of the Act. The Chief Justice denied the application. Consequently, no notice was given to the Attorney General of Canada or to the Attorneys General of the provinces. Shortly after the denial of this application and immediately before the hearing of this appeal, Rule 32 was amended [SOR/84‑821] reducing the requirement for such an order but not so as to remove the need where, as here, the issue is constitutional validity or constitutional applicability. By reason of this background, no oral argument was presented to the Court by any counsel on the invalidity, or inoperability or inapplicability of these sections of the Act. Thus this Court will not address the validity of the legislation.
2. All the appellants except Coons, Jobin, Grinstead, Thomson, Mowat and Moore seek relief from the Hearing Officer's narrow interpretation of the right to and the scope of counsel as permitted or allowed under s. 20(1) of the Act, through s. 7 of the Charter . All of the rulings of the Hearing Officer that are being challenged in these proceedings were made before the Charter came into force on April 17, 1982. Thus the Charter does not apply to the facts of this case. No oral argument was presented to this Court on these s. 7 issues.
96. Reducing the foregoing discussions of the statute and the general law to the issues raised in the originating applications, I would dispose of each claim for relief as follows:
1. Paragraph (a): Those persons who are being investigated are not entitled to be present "throughout the whole of the inquiry".
2. Paragraphs (b) and (c): Counsel for the applicants, be they witnesses or persons being investigated, may not examine or cross‑examine witnesses in the inquiry except that they may put questions to their client for the purpose of clarifying and explaining evidence already given.
3. Paragraph (d): Counsel for the applicants may not put questions to Mr. Kirch, and the Hearing Officer is neither required nor permitted to allow counsel for the applicants to examine Kirch or to require the Director to do so.
4. Paragraphs (e) and (f) in the Notice of Motion were not argued in this Court.
5. Paragraph (a) of the Supplementary Application: Neither "commission counsel" nor the Director need disclose the "objective cause" for the inquiry to the applicants when the inquiry is commenced.
97. The appeal is therefore dismissed with costs and the order of the Federal Court of Appeal stands.
Appeal dismissed with costs.
Solicitors for the appellant Harold Irvine: Osler, Hoskin & Harcourt, Toronto.
Solicitors for the appellants Namasco Limited and Charles Ian McKay: Campbell, Godfrey & Lewtas, Toronto.
Solicitors for the appellants Drummond McCall Inc., Lorne Gilbert Coons, James Arthur Jobin, Donald Charles Grinstead, Hugh Fitzgerald Thomson, William Alexander Mowat and Bruce Scott Moore: Stikeman, Elliott, Robarts & Bowman, Toronto.
Solicitors for the appellants Samuel, Son & Co. Limited and W. Grant Brayley: Smith, Lyons, Torrance, Stevenson & Mayer, Toronto.
Solicitors for the appellant Westeel‑Rosco Limited: Blake, Cassels & Graydon, Toronto.
Solicitors for the appellants York Russel Inc., L. F. Newbery, Norman Katzman, John M. White, Leon Robidoux and Timothy H. Coughlin: Tilley, Carson & Findlay, Toronto.
Solicitors for the appellants Newman Steel Ltd., Benjamin P. R. Newman, Sigmund R. Taube, Zenon P. Karcz and Peter R. Sheppard: Phillips & Vineberg, Montréal.
Solicitor for the respondents: Deputy Attorney General of Canada, Ottawa.
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