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SUPREME
COURT OF CANADA
Between:
Régie
des rentes du Québec
Appellant
and
Canada
Bread Company Ltd., Sean Kelly, in his capacity as trustee of the Bakery and
Confectionery Union and Industry Canadian Pension Fund, Multi-Marques Inc.,
Multi-Marques Distribution Inc. and Bakery, Confectionery, Tobacco Workers and
Grain Millers International Union, Local 468
Respondents
-
and -
Attorney
General of Quebec, Robert Thauvette and
Administrative
Tribunal of Québec
Interveners
Coram: McLachlin C.J. and Fish, Abella, Rothstein, Cromwell,
Karakatsanis and Wagner JJ.
Reasons for
Judgment:
(paras. 1 to 49)
Dissenting
Reasons:
(paras. 50 to 73)
|
Wagner J. (Abella, Rothstein, Cromwell and Karakatsanis
JJ. concurring)
McLachlin C.J. (Fish J. concurring)
|
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Régie des rentes du Québec v. Canada Bread Company Ltd., 2013
SCC 46, [2013] 3 S.C.R. 125
Régie des rentes du Québec Appellant
v.
Canada Bread Company Ltd.,
Sean Kelly, in his capacity as trustee
of the Bakery and
Confectionery Union and Industry Canadian
Pension Fund,
Multi‑Marques Inc., Multi‑Marques
Distribution Inc. and
Bakery, Confectionery, Tobacco Workers and
Grain Millers
International Union, Local 468 Respondents
and
Attorney General of Quebec, Robert
Thauvette and
Administrative
Tribunal of Québec Interveners
Indexed as: Régie des
rentes du Québec v. Canada Bread Company Ltd.
2013 SCC 46
File No.: 34505.
2013: April 17; 2013: September 13.
Present: McLachlin C.J. and Fish, Abella, Rothstein, Cromwell,
Karakatsanis and Wagner JJ.
on appeal from the court of appeal for quebec
Legislation
— Retroactivity — Declaratory provisions — Régie des rentes du
Québec effecting partial termination of pension plan — Legislation amending
Supplemental Pension Plans Act coming into force after Court of Appeal set
aside Régie’s decision and remitted case to Régie for redetermination —
New declaratory provisions applying to pending cases — Whether dispute between
parties was pending when provisions came into force — Whether Court of Appeal’s
judgment fully and definitively adjudicated rights and obligations of parties
that resulted from partial termination of pension plan —
Whether Régie was entitled to give effect to declaratory provisions in
resolving dispute between parties — An Act to
amend the Supplemental Pension Plans Act, the Act respecting the Québec Pension
Plan and other legislative provisions, S.Q. 2008, c. 21 — Supplemental
Pension Plans Act, R.S.Q., c. R‑15.1,
ss. 14.1, 228.1, 319.1.
Administrative
law — Boards and tribunals — Jurisdiction — Régie des rentes du Québec
effecting partial termination of pension plan — Legislation amending
Supplemental Pension Plans Act coming into force after Court of Appeal set
aside Régie’s decision and remitted case to Régie for redetermination —
Whether it was open to Régie to take new statutory provisions
into consideration in determining outcome of case — An Act to amend the Supplemental Pension Plans Act, the Act
respecting the Québec Pension Plan and other legislative provisions, S.Q. 2008,
c. 21 — Supplemental Pension Plans Act, R.S.Q., c. R‑15.1, ss. 14.1, 228.1, 319.1.
As
a result of the closure of two divisions of the employer, Multi‑Marques,
the Régie des rentes du Québec issued two decisions under Quebec’s Supplemental
Pension Plans Act (“SPPA”) to effect the partial termination of the
pension plan of the divisions’ employees. Multi‑Marques challenged the
manner in which the termination was carried out, arguing that under ss. 9.12
and 9.13 of the plan’s rules, employee benefits should be reduced if employer
contributions were insufficient to pay the pension fund’s shortfall. A review
committee convened by the Régie decided that ss. 9.12 and 9.13 were
incompatible with the SPPA, which provides that where the assets of a
pension plan are insufficient to satisfy the rights of the plan’s members and
beneficiaries, the amount of the deficiency constitutes a debt of the
employer. This decision was subsequently affirmed by the Administrative
Tribunal of Québec (“ATQ”) and by the Superior Court, but the Court of Appeal
found that ss. 9.12 and 9.13 were not incompatible with the SPPA
and accordingly remitted the matter to the Régie, ordering the latter to review
its initial decisions in conformity with the Court of Appeal’s judgment.
While
an application for leave to appeal from the Court of Appeal’s decision was
pending in this Court, the SPPA was amended by adding ss. 14.1 and
228.1. In these provisions, the legislature essentially adopted the Régie’s
approach to the application of ss. 9.12 and 9.13 of the plan’s rules and
rejected the approach taken by the Court of Appeal. After the application for
leave to appeal had been dismissed, the Régie undertook to complete the partial
termination of the pension plan. Instead of following the Court of Appeal’s directions,
the Régie’s review committee applied the new provisions of the SPPA, and
accordingly refused to apply ss. 9.12 and 9.13 and confirmed its initial
decisions. The ATQ upheld the Régie’s decision. On judicial review, the
Superior Court set aside the ATQ’s decision. The Court of Appeal dismissed the
Régie’s appeal on the ground that, once the application for leave to appeal had
been dismissed, the Court of Appeal’s initial judgment had acquired the
authority of a final judgment and should have been followed by the Régie.
Held
(McLachlin C.J. and Fish J. dissenting): The appeal should be
allowed.
Per
Abella, Rothstein, Cromwell, Karakatsanis and Wagner JJ.: The
principle of res judicata, which precludes parties from relitigating an
issue in respect of which a final determination has been made as between them,
does not preclude the legislature from negating the effects of such a
determination. It is within the prerogative of the legislature to enter the
domain of the courts and offer a binding interpretation of its own law by
enacting declaratory legislation. Such legislation has an immediate effect on
pending cases, and is therefore an exception to the general rule that
legislation is prospective. Section 319.1 of the SPPA, which was enacted
at the same time as ss. 14.1 and 228.1, expressly provides that these
provisions are declaratory. In addition to this unambiguous language, the
circumstances of their enactment show that the legislature intended them to be
declaratory. It can be seen from the debate that led up to their enactment
that the legislature’s objective was to overrule the Court of Appeal’s decision
in order to protect the plan’s members and beneficiaries and to ensure that the
decision in question would not become a precedent that would be binding on the
courts in pending and future cases.
The
concept of the final judgment that does not ultimately determine the rights and
obligations of the parties is the basis for distinguishing pending cases from
those that are not pending. Here, when the declaratory provisions came into
force, the case between the parties was still pending. The Court of Appeal’s
decision resulted in a final determination only on the question of law relating
to the interpretation of certain provisions of the pension plan’s rules and
their compatibility with the SPPA. The court remitted the question of
the parties’ substantive rights in light of this interpretation to the Régie
for determination. The terms of the partial termination of the fund had yet to
be determined. Because the Court of Appeal had remitted the matter to it, the
Régie was a competent authority properly charged with resolving a pending case
when the declaratory provisions came into force. It was therefore open to the
Régie to take them into consideration in determining the outcome of that case.
Where an administrative decision‑maker has a duty to follow the
directions of a reviewing court, it is on the basis of stare decisis.
It is therefore obligated to follow such directions, but only insofar as they
remain good law. In the instant case, the declaratory legislation is not
ambiguous, and the National Assembly decided unanimously to counter the effect
of the Court of Appeal’s decision by enabling the Régie to interpret the SPPA
in a manner consistent with what the legislature considered to be the Act’s
true objectives. As a result of the legislature’s intervention, the Court of
Appeal’s directions became bad law. Accordingly, the Régie was not only
entitled to interpret the SPPA in light of the declaratory provisions,
it was obligated to do so.
Per
McLachlin C.J. and Fish J. (dissenting): When a retroactive law comes
into force while a case is being appealed, it falls to be applied by whatever
level of appellate court is seized of the matter at that time. In the present
case, only the Supreme Court of Canada, before which an application for leave
to appeal was pending at the time of the coming into force of the retroactive
provisions, had the jurisdiction to apply the provisions to resolve the dispute
between Multi‑Marques and the pension beneficiaries. Once it denied
leave to appeal, all avenues of appeal were exhausted. Consequently, the
Quebec Court of Appeal’s judgment acquired the authority of res judicata
between the parties with respect to the issue of whether the employer’s funding
obligations could be limited by clauses 9.12 and 9.13 of the pension plan’s
rules.
The
precise monetary liability of the employer was not determined by the Court of
Appeal’s disposition, and the matter was remitted back to the Régie for a
computation of that liability. However, the fact that this remained in issue
does not make the declaratory provisions applicable to this dispute. There is
no principled basis on which to conclude that declaratory laws apply to
judicial determinations for which all avenues of appeal have been exhausted,
but which fall short of determining every issue in dispute. This runs counter
to the principle that declaratory provisions must be interpreted and applied
restrictively, and to the correlative principle that clear statutory language
is required to extinguish the effects of a judgment as between the parties.
The declaratory law in this case does not contain such language. It follows
that the Court of Appeal’s judgment was final and binding.
There
was no authority for the Régie’s purported jurisdiction to determine afresh
whether Multi‑Marques’ funding obligations were limited by clauses 9.12
and 9.13 of the pension plan’s rules. The Court of Appeal’s directions did not
instruct the Régie to determine the matter afresh. Nor does the Régie’s
enabling statute contain any provisions that allow it to review a matter on
which a higher court has passed judgment. The Régie had to fulfill the task
for which the case had been remitted to it, i.e. compute the precise monetary
liability that resulted from the substantive rights and obligations determined
by the Court of Appeal. By failing to do so, the Régie effectively
circumvented the process of judicial review and reinstated its original
decision without having the jurisdiction to do so.
Cases Cited
By Wagner J.
Considered:
Western Minerals Ltd. v. Gaumont, [1953] 1 S.C.R. 345; referred
to: Danyluk v. Ainsworth Technologies Inc., 2001 SCC 44, [2001] 2
S.C.R. 460; Zadvorny v. Saskatchewan Government Insurance (1985),
38 Sask. R. 59; Canada (Commissioner of Competition) v.
Superior Propane Inc., 2003 FCA 53, [2003] 3 F.C. 529.
By McLachlin C.J. (dissenting)
Dunsmuir
v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190; Barbour v. University
of British Columbia, 2010 BCCA 63, 282 B.C.A.C. 270, leave to appeal
refused, [2010] 1 S.C.R. vi; British Columbia v. Imperial Tobacco
Canada Ltd., 2005 SCC 49, [2005] 2 S.C.R. 473; Société canadienne de
métaux Reynolds ltée v. Québec (Sous‑ministre du Revenu), [2004]
R.D.F.Q. 45; Western Minerals Ltd. v. Gaumont, [1953] 1 S.C.R. 345; CNG
Producing Co. v. Alberta (Provincial Treasurer), 2002 ABCA 207, 317 A.R.
171; Roberge v. Bolduc, [1991] 1 S.C.R. 374; Woods Manufacturing Co. v.
The King, [1951] S.C.R. 504; Zadvorny v. Saskatchewan Government
Insurance (1985), 38 Sask. R. 59; Hornby Island Trust Ctee. v. Stormwell
(1988), 30 B.C.L.R. (2d) 383; Shuchuk v. Workers’ Compensation Board Appeals
Commission (Alta.), 2012 ABCA 50, 522 A.R. 336; Canada (Commissioner of
Competition) v. Superior Propane Inc., 2003 FCA 53, [2003] 3 F.C. 529.
Statutes and Regulations Cited
Act respecting the Québec Pension Plan,
R.S.Q., c. R‑9, s. 26.
Act to amend the Supplemental Pension Plans Act, the Act respecting
the Québec Pension Plan and other legislative provisions, S.Q. 2008, c. 21 (Bill 68).
Civil Code of Québec, S.Q. 1991,
c. 64, art. 2848.
Supplemental Pension Plans Act, R.S.Q.,
c. R‑15.1, ss. 5, 14.1, 202, 203, 211, 228, 228.1, 319.1.
Authors Cited
Black’s Law Dictionary, 9th ed.
St. Paul, Minn.: West, 2009, “stare decisis”.
Brown, Donald J. M., and John M. Evans, with the
assistance of Christine E. Deacon. Judicial Review of Administrative
Action in Canada. Toronto: Canvasback, 1998 (loose‑leaf updated
August 2012).
Côté, Pierre‑André, in collaboration with Stéphane Beaulac and
Mathieu Devinat. The Interpretation of Legislation
in Canada, 4th ed. Toronto: Carswell, 2011.
Craies, William Feilden. A Treatise on Statute Law, 4th ed. by
Walter S. Scott. London: Sweet & Maxwell, 1936.
Pigeon, Louis‑Philippe. Drafting and Interpreting
Legislation, trans. by R. Clive Meredith. Toronto:
Carswell, 1988.
Quebec. Assemblée nationale. Journal des débats, vol. 40,
no 65, 1re sess., 38e lég., 2 avril 2008.
Quebec. Assemblée nationale. Journal des débats de la
Commission des affaires sociales, vol. 40, no 52, 1re
sess., 38e lég., 3 juin 2008, Étude détaillée du projet de loi
no 68 — Loi modifiant la Loi sur les régimes complémentaires
de retraite, la Loi sur le régime de rentes du Québec et d’autres dispositions
législatives.
Roubier, Paul. Le droit transitoire: conflits des lois dans le
temps, 2e éd. Cowansville, Qué.: Yvon Blais, 1993.
Sullivan, Ruth. Sullivan on the Construction of Statutes,
5th ed. Markham, Ont.: LexisNexis, 2008.
APPEAL
from a judgment of the Quebec Court of Appeal (Thibault, Rochette and
Kasirer JJ.A.), 2011 QCCA 1518, [2011] R.J.Q. 1540, [2011] R.J.D.T. 747,
93 C.C.P.B. 1, 29 Admin. L.R. (5th) 291, [2011] J.Q. no 10713
(QL), 2011 CarswellQue 8758, SOQUIJ AZ‑50781009, affirming a decision of
Grenier J., 2010 QCCS 6104, [2011] R.J.Q. 122, [2011] R.J.D.T. 35, 87
C.C.P.B. 23, 17 Admin. L.R. (5th) 264, [2010] J.Q. no 13476
(QL), 2010 CarswellQue 13421, SOQUIJ AZ‑50699375, setting aside a
decision of the Administrative Tribunal of Québec, 2010 QCTAQ 04423, [2010]
R.J.D.T. 796, 83 C.C.P.B. 111, 2010 LNQCTAQ 5 (QL), 2010 CarswellQue 3608,
SOQUIJ AZ‑50632060. Appeal allowed, McLachlin C.J. and Fish J.
dissenting.
Sheila York and Carole
Arav, for the appellant.
Éric Mongeau, Patrick
Girard and Michel Legendre, for the respondents the Canada Bread
Company Ltd., Multi‑Marques Inc. and Multi‑Marques Distribution
Inc.
Natalie Bussière and
Sophie Tremblay, for the respondent Sean Kelly, in his capacity as
trustee of the Bakery and Confectionery Union and Industry Canadian Pension
Fund.
No
one appeared for the respondent the Bakery, Confectionery, Tobacco Workers and
Grain Millers International Union, Local 468.
Stéphane Rochette
and Jean‑Yves Bernard, for the intervener the Attorney General of
Quebec.
No
one appeared for the interveners Robert Thauvette and the Administrative
Tribunal of Québec.
The judgment of Abella,
Rothstein, Cromwell, Karakatsanis and Wagner JJ. was delivered by
Wagner J. —
I. Overview
[1]
A criticism often levelled against retroactive
legislation is that it thwarts settled expectations. This case concerns
expectations relating to the interpretation of certain provisions of Quebec’s Supplemental
Pension Plans Act, R.S.Q., c. R-15.1 (“SPPA”). It confirms
that the legislature may disrupt these expectations by enacting declaratory
provisions, and that such provisions apply to any ongoing dispute in which a
final judgment on the merits has not yet been handed down.
[2]
When a legislature enacts a declaratory
provision that has retrospective effect, it is presumed to have weighed the
need for the interpretive clarity the provision would bring against the
disruption and unfairness that might result from its retroactive nature. The
courts therefore owe deference to a decision by the legislature to enact such
legislation.
[3]
In the case at bar, a final judicial
determination of the rights and obligations of the parties had not yet been
made. As a result, the declaratory provisions passed by the Quebec legislature
to aid in the interpretation of the SPPA were applicable.
II. Facts
[4]
The dispute between the parties to this appeal
has passed before decision-makers and judges at various levels not once, but
twice.
[5]
The appellant, the Régie des
rentes du Québec (“Régie”), is a government agency that is responsible for the
application of the SPPA. The respondents Multi-Marques Inc. and Multi-Marques Distribution Inc. (referred to collectively as
« Multi-Marques »), and Canada Bread Company Ltd. are contributing
employers of the Bakery and Confectionery Union and Industry Canadian
Pension Fund (“Fund”). Sean Kelly represents the trustees of the Fund.
[6]
In 1992 and 1994, the employees of the Gailuron
and Durivage divisions of Multi-Marques joined the Fund. The trustees granted pension credits to the
employees of the two divisions to reflect the years of service they had
accumulated before Multi-Marques joined the Fund. The granting of these credits
created a deficit, which Multi-Marques was to remedy by making payments to the
Fund over a 15-year period. Before that period expired, Multi-Marques decided
to shut down its Gailuron and Durivage divisions in 1996 and 1997, respectively.
[7]
As a result of the
closures, the Régie issued, on May 16, 2002, two essentially identical
decisions to effect the partial termination of the Fund for the employees of
the Gailuron and Durivage divisions of Multi-Marques. The closures also created
a solvency deficiency of approximately $5 million that was needed to cover the
pension credits granted to the employees of the two divisions for prior
service. Both of the Régie’s decisions required that the actuarial reports to
be filed upon termination indicate the amounts to be paid by the employer to
rectify the Fund’s solvency deficiency in order to ensure that the benefits of
the plan members affected by the termination would be paid in full.
[8]
Although the partial termination
of the Fund was not contested by any of the parties, the employer challenged
the manner in which it was carried out. Multi-Marques argued that under ss.
9.12 and 9.13 of the Fund’s Rules and Regulations (“Rules”), benefits could be
reduced in response to certain extrinsic factors and that employee benefits
should accordingly be reduced if employer contributions were insufficient to
pay the Fund’s shortfall. Thus, the Rules limited the employer’s funding
obligations to contributions it had already made. To respond to this challenge,
the Régie convened a review committee to determine whether ss. 9.12 and 9.13 of
the Rules were compatible with the SPPA.
[9]
Sections 9.12 and 9.13 of the Rules read as
follows:
Section 9.12 — Limitation
of Liability
The Plan has been established
on the basis of an actuarial calculation which has established, to the extent
possible, that the contributions will, if continued, be sufficient to maintain
the Plan on a permanent basis, fulfilling the funding requirements of the Act.
Except for liabilities which may result from provisions of the Act, nothing in
this Plan shall be construed to impose any obligation to contribute beyond the
obligation of the Contributing Employer to make contributions as stipulated in
its Collective Agreement with the Union or Local Union.
There shall be no liability
upon the Trustees individually, or collectively, or upon the Union or Local
Union to provide the benefits established by this Plan, if the Fund does not
have assets to make such payments.
Section 9.13 — Limitation
of Liability for Pension Benefits
(a) Any provisions in the Plan to the contrary notwithstanding,
if a Contributing Employer ceases to be a Contributing Employer (hereinafter
referred to as a Withdrawing Employer) for any reason, the assets in respect of
the Withdrawing Employer, which consist of the total contributions made by the
Withdrawing Employer together with interest, less benefit payments already
made, shall be allocated to provide for benefits, to the extent they are
funded, in respect of service with that Withdrawing Employer, subject to the
following:
(i) For purposes of this Section only, each Participant’s
accrued benefit shall be determined as if the Participant has satisfied the
eligibility conditions for vesting.
(ii) If the Plan is fully funded on a going concern basis on
the date the Withdrawing Employer terminates participation, benefits shall be
reduced only to the extent that the actuarial liabilities that are established
for benefits in respect of Past Service Credit, have not been fully funded by
the Withdrawing Employer’s assets.
(iii) If the Plan is not fully funded on a going concern basis
on the date the Withdrawing Employer terminates participation, benefits shall
be reduced to the extent they are not funded and, in any event, benefits in
respect of Past Service Credit shall be reduced to the extent they are not
fully funded by the Withdrawing Employer’s assets.
(iv) Notwithstanding anything contained in this Section to the
contrary, the allocation of the Withdrawing Employer’s assets shall be in
accordance with the applicable Act.
(b) If a group of Contributing Employers with Collective
Agreements with any one Local Union shall cease to be Contributing Employers
with respect to the members of that Local Union, on approximately the same
date, the Trustees shall have the right to apply the above subsection (a) as
though said Employers were one Contributing Employer. In any such case, the
calculations shall include all Contributing Employers of the group having had
Collective Agreements with such Local Union. [A.R., vol. I, at pp. 160-62]
[10]
In its decision of April 14, 2003,
the review committee decided that ss. 9.12 and 9.13 of the Rules were
incompatible with s. 211 of the SPPA, which entitles the plan’s members
to the full value of their pensions, and s. 228 of the SPPA, which
provides that where the assets of a pension plan are insufficient to satisfy
the rights of the plan’s members and beneficiaries, the amount of the
deficiency constitutes a debt of the employer. Because ss. 9.12 and 9.13 of
the Rules were incompatible with the SPPA, they were, pursuant to s. 5
of the SPPA, without effect. They could not therefore be applied in the
actuarial reports required to conclude the partial termination. This decision
was subsequently affirmed by the Administrative Tribunal of Québec (“ATQ”) on
June 15, 2004, and again on judicial review by the Quebec Superior Court on
July 20, 2006. Multi-Marques, Sean Kelly and Canada Bread Company Ltd.
appealed the Superior Court’s decision to the Quebec Court of Appeal.
[11]
On April 2, 2008, the Court of
Appeal allowed the appeals: 2008 QCCA 597, [2008] R.J.Q. 853. It found that
ss. 9.12 and 9.13 were not incompatible with the SPPA and that full
effect should be given to them in the actuarial reports prepared in the context
of the partial termination of the Fund. Accordingly, it set aside the
decisions of the Superior Court, the ATQ and the Régie’s review committee, and
remitted the matter to the Régie, ordering the latter to review its initial
decisions in conformity with the Court of Appeal’s judgment. For ease of
reference, I reproduce the Court of Appeal’s orders here:
[translation]
Allows the appeals, with costs both in the Superior Court and in the
Court of Appeal;
Sets aside the decision
of the Superior Court dated July 20, 2006;
Sets aside the decision
of the Administrative Tribunal of Québec dated June 15, 2004;
Sets aside the decision
of the review committee of the Régie des rentes du Québec dated April 14, 2003;
Refers the
matter back to the Régie des rentes du Québec to review its decisions
D-41130-001 and D-41130-02 dated May 16, 2002 in conformity with this decision;
Authorizes Kelly
to file termination actuarial reports that apply clauses 9.12 and 9.13 of the
pension plan in light of the partial terminations resulting from the
withdrawal from the plan of the employees of the Gailuron and Durivage
divisions of Multi-Marques. [Emphasis added; paras.
104-9.]
[12]
On May 29, 2008, the Régie filed an application
for leave to appeal to this Court.
[13]
On the same day that the Court of Appeal
rendered its judgment, the Quebec National Assembly introduced Bill 68, An
Act to amend the Supplemental Pension Plans Act, the Act respecting the
Québec Pension Plan and other legislative provisions (Journal des débats,
vol. 40, No. 65, 1st Sess., 38th Leg., April 2, 2008). In the debate at the
committee stage, the Minister of Employment and Social Solidarity, Sam Hamad,
made it clear that this amending legislation was motivated by the Court of
Appeal’s decision and by the need to protect the Multi-Marques pensioners:
[translation] So the
purpose of this amendment is to counter the effects of the judgment rendered by
the Quebec Court of Appeal on April 2, 2008, in the case of Multi-Marques
Distribution Inc. v. Régie des rentes du Québec. . . . With respect for
the court, that judgment is based on an interpretation of the Supplemental
Pension Plans Act that is incompatible with the Act’s objectives.
[Emphasis added.]
(National
Assembly, Journal des débats de la Commission des affaires sociales,
vol. 40, No. 52, 1st Sess., 38th Leg., June 3, 2008)
[14]
This legislation introduced ss. 14.1 and 228.1
into the SPPA. In these provisions, the legislature essentially adopted
the Régie’s approach to the application of ss. 9.12 and 9.13 of the Rules and
rejected the approach taken by the Court of Appeal. As a result of the
amendments, no provisions of a pension plan may make benefits due conditional
on extrinsic factors such that the obligations of an employer towards the plan
are limited or reduced. In addition, the legislature expressly provided, in s.
319.1, that these new sections of the Act were declaratory in nature.
[15]
The National Assembly passed Bill 68 on June 18,
2008 (S.Q. 2008, c. 21), and this Court dismissed the Régie’s application for
leave to appeal on October 16, 2008: [2008] 3 S.C.R. ix.
[16]
Following this Court’s decision, the Régie
undertook to implement the Court of Appeal’s judgment of April 2, 2008 and to
complete the partial termination of the Fund. In November 2008, the Régie
informed counsel for the parties that a review committee had been formed to
implement the Court of Appeal’s judgment, and invited them to submit comments
with respect to the implementation. On August 14, 2009, the Régie’s review
committee released the decision which is the subject of this appeal.
[17]
Instead of following the Court of Appeal’s
approach, according to which ss. 9.12 and 9.13 of the Rules were to be
considered in establishing the obligations of Multi-Marques resulting from the
partial termination, the Régie applied the new provisions of the SPPA.
It accordingly refused to apply the clauses of the Rules that allowed for the
reduction of benefits payable to the plan’s members and beneficiaries, and
confirmed its initial decisions of May 16, 2002. Sean Kelly, Canada Bread
Company Ltd. and Multi-Marques contested the Régie’s decision before the ATQ.
III. Judicial History
A. Administrative Tribunal of
Québec, 2010 QCTAQ 04423, [2010] R.J.D.T. 796 (Judges
Cormier and Lévesque)
[18]
The ATQ addressed three issues in its decision: (1)
whether the Régie had erred in law by establishing a committee to review its
initial decisions; (2) whether the review committee had breached the rules of
natural justice by failing to send prior notice of its decision and by failing
to inform the parties that it was considering applying the amendments that had
been made to the SPPA after the Court of Appeal had rendered its
judgment; and (3) whether the review committee had erred in applying the
declaratory provisions of the SPPA in this case. Only the third issue
remains relevant in this Court.
[19]
With respect to this third issue, the ATQ upheld
the Régie’s position, finding that the Régie was right to apply the declaratory
provisions, as the case had still been pending when the declaratory provisions
came into force on June 20, 2008.
B. Quebec Superior Court, 2010
QCCS 6104, [2011] R.J.Q. 122 (Grenier J.)
[20]
Both the employers and the representative of the
trustees applied to the Superior Court for judicial review of the ATQ’s
decision. The Superior Court allowed their application.
[21]
The application judge held that the standard of
review was correctness. In addressing the Régie’s decision, she stated that
the issue was whether the Régie had the authority to make the order it did in
light of the Court of Appeal’s decision. In her view, the ATQ had erred in
holding that it was open to the Régie to apply the declaratory provisions in
the specific context of this case. She explained that the case could not have
been “pending” in June 2008, and that when the Régie issued its new decision in
2009, the decision of the Court of Appeal had acquired the authority of a final
judgment, which meant that the declaratory provisions of the SPPA could
not apply to the dispute between the parties. As a result, the Régie was
obligated to take ss. 9.12 and 9.13 of the Rules into account in its orders
respecting the actuarial calculations to be made upon termination.
C. Quebec
Court of Appeal, 2011 QCCA 1518, [2011] R.J.Q. 1540 (Thibault, Rochette and
Kasirer JJ.A.)
[22]
The Court of Appeal also found that the Régie
had erred in applying the declaratory provisions. Thibault J.A., writing for
the court, stated that, when the application for leave to appeal was pending
before this Court, the Court of Appeal’s judgment had not yet acquired the
authority of a final judgment. However, only this Court would have been able
to apply the declaratory legislation had it decided to hear the case. Once
this Court had dismissed the Régie’s application for leave, the Court of
Appeal’s judgment had acquired the authority of a final judgment and should
have been followed by the Régie. The Court of Appeal held that although the
Régie has the power under An Act respecting the Québec Pension Plan,
R.S.Q., c. R-9, s. 26, to review its decisions, that power of review does not
empower it to disregard a final judgment of the Court of Appeal.
IV. Issues
[23]
The issues in this case are:
1. What is the effect of declaratory legislation?
2. Did the Régie err in applying the declaratory legislation in
determining the parties’ rights and obligations?
V. Analysis
[24]
The principle of res judicata precludes
parties from relitigating an issue in respect of which a final determination
has been made as between them: Danyluk v. Ainsworth Technologies Inc.,
2001 SCC 44, [2001] 2 S.C.R. 460, at para. 18. However, it does not preclude
the legislature from negating the effects of such a determination. In the case
at bar, it is clear that the legislature’s intention was not only to deprive
the Court of Appeal’s judgment of precedential value, but also to negate its
effect of rendering the issue res judicata as between the parties. In my
view, the legislature attained both these objectives.
[25]
I have read my colleague’s dissenting reasons. Although
they focus on the Régie’s jurisdiction, I firmly believe that the central issue
in this appeal relates to the nature and effect of the declaratory legislation.
A. What Is the Effect of Declaratory Legislation?
[26]
It is settled law in Canada that it is within the prerogative of the legislature
to enter the domain of the courts and offer a binding interpretation of its own
law by enacting declaratory legislation: L.-P. Pigeon, Drafting
and Interpreting Legislation (1988), at pp. 81-82.
As this Court acknowledged in Western Minerals Ltd. v. Gaumont, [1953]
1 S.C.R. 345, such forays are usually made where the legislature wishes to
correct judicial interpretations that it perceives to be erroneous.
[27]
In enacting declaratory legislation, the
legislature assumes the role of a court and dictates the interpretation of its
own law: P.-A. Côté, in collaboration with S. Beaulac and M. Devinat, The
Interpretation of Legislation in Canada (4th ed. 2011), at p. 562. As a
result, declaratory provisions operate less as legislation and more as
jurisprudence. They are akin to binding precedents, such as the decision of a
court: P. Roubier, Le droit transitoire: conflits des lois dans le temps
(2nd ed. 1993), at p. 248. Such legislation may overrule a
court decision in the same way that a decision of this Court would take
precedence over a previous line of lower court judgments on a given question of
law.
[28]
It is also settled law that declaratory
provisions have an immediate effect on pending cases, and are therefore an
exception to the general rule that legislation is prospective. The
interpretation imposed by a declaratory provision stretches
back in time to the date when the legislation it purports to interpret first
came into force, with the effect that the legislation in question is deemed to
have always included this provision. Thus, the interpretation so declared is
taken to have always been the law: R. Sullivan, Sullivan on the Construction
of Statutes (5th ed. 2008), at pp. 682-83.
[29]
The immediate effect of declaratory legislation
is limited, however. In 1953, in Western Minerals, this Court endorsed
the statement in W. F. Craies, A Treatise on Statute Law (4th ed. 1936),
that declaratory laws “decide like cases pending when the judgments are given,
but do not re-open decided cases”: p. 370, citing Craies, at pp. 341-42. Like a binding precedent, an interpretation the
legislature adopts by enacting a declaratory provision is applicable to all
future cases as well as to cases that are pending when the
provision comes into force, despite the fact that the events that gave rise to
any such dispute would have taken place before the provision was enacted. However,
declaratory provisions do not reopen cases that have been resolved in a final
judgment.
[30]
Before going further in my analysis, I must highlight a distinction between two
concepts that are central to the resolution of this appeal: that of a “final
judgment” and that of a “final judgment that ultimately determines the rights
and obligations of the parties”. A judgment need not dispose of the litigation
in its entirety to be final. If it disposes of any substantive interlocutory issue,
res judicata will apply. On the other hand, res judicata will
also apply to a final judgment that ultimately determines the rights and
obligations of the parties, but it then disposes of the case in its
entirety and makes any further proceedings unnecessary.
[31]
This distinction is significant because,
in Western Minerals, this Court endorsed the proposition that
declaratory legislation does not reopen decided cases, but it made no
mention of the effect of such legislation on decided issues. In Canada,
there is no definitive case law on the effect of declaratory legislation on
decided issues. As a result, I cannot presume that declaratory legislation that
is clearly intended to negate final judgments that do not ultimately determine
the rights and obligations of the parties does not apply to such a judgment.
This conclusion is the only one I can reach in light of the jurisprudence and
the relevant legal principles.
[32]
The concept of the final judgment that
does not ultimately determine the rights and obligations of the parties is the
basis for distinguishing pending cases from those that are not pending. Pending cases are cases that are currently before a competent
tribunal and are awaiting a final and irrevocable determination on the merits.
As Cartwright J. explained in Western Minerals, such cases include
“actions in which, while judgment has been given, an appeal from such judgment
is pending at the date of the
declaratory act coming into force”: p. 370.
Accordingly, only cases in which judgments have
definitively determined the parties’ rights and obligations are no longer
pending.
[33]
In the case at bar, the declaratory legislation will therefore apply unless it is
found that a case, and not merely an issue, has been decided.
[34]
In contrast to my position, the Chief
Justice states that clear language is required where the legislature intends to
extinguish the effects of any final judgment in which an issue has been decided
(paras. 62, 64 and 71). With respect, no support for this proposition can be
found in this Court’s case law. The Chief Justice relies solely on the
Saskatchewan Court of Appeal’s decision in Zadvorny v. Saskatchewan
Government Insurance (1985), 38 Sask. R. 59, in support of this principle.
For the reasons set out above, I am neither bound nor persuaded by that case. In
my view, the Canadian jurisprudence and the relevant legal principles tend in
the opposite direction.
[35]
Furthermore, I find it
unnecessary to insist on clear legislative language in a case such as this one
where it is not in dispute that the legislature’s intention was to extinguish
the effects of the judgment as between the parties. Not only is this
proposition unsupported by this Court’s jurisprudence, it would effectively
defeat the purpose of the enactment. As can be seen from the record of the
legislative committee’s debate, it was clear from the start that the
legislature’s objective in enacting the declaratory provisions was to counter the effects of the Court of
Appeal’s judgment of April 2, 2008 in order to protect the affected pensioners. With respect, an approach that disregarded this clear intent and
instead required clear language would in my view be overly formalistic and
would place unnecessary limits on the evidence that can be considered in
determining the effects of declaratory legislation.
B. Did the Régie Err in Applying the Declaratory Legislation?
(1) Application of the Declaratory
Legislation to the Dispute
[36]
In the instant case, it is common ground that
the provisions introduced into the SPPA by Bill 68 are declaratory in
nature. Section 319.1 of the SPPA, which was enacted at the same time
as ss. 14.1 and 228.1,
expressly provides that these provisions are declaratory. In addition to this
unambiguous language, the circumstances of their enactment show that the
legislature intended them to be declaratory. It can be seen from the debate that led up to their enactment that the legislature’s
objective was to overrule the Court of Appeal’s decision in order to protect
the plan’s members and beneficiaries and to ensure that the decision in
question would not become a precedent that would be binding on the courts in
pending and future cases.
[37]
Since the declaratory nature of the provisions
at issue in this appeal and the implications of that nature are not challenged
by any of the parties, the question of the applicability of those
provisions hinges on whether the dispute between the parties
was pending when they were enacted. Put more simply, what must be determined is
whether the appeal concerns a decided case, or merely a decided issue.
[38]
Given that both the Régie and the intervener
Attorney General of Quebec base their argument that this case was pending on
the Régie’s 2008 application for leave to appeal to this Court, I should make
it clear that that application is not the basis for my finding that the case
was pending at the relevant time. Although this Court clearly stated in Western
Minerals that a case in which a final judgment has been rendered but an
appeal from that judgment is pending qualifies as a pending case for the
purpose of the application of declaratory legislation, that is not the only way
for a case to qualify as one. Rather, as I explained above, the key factor in
finding a case to be pending is the absence of a final determination of the
rights and obligations of the parties. Like a case that has been appealed, one
that has been remitted to a lower court is also a pending case.
[39]
On June 20, 2008, when the declaratory
provisions came into force, the case between the parties was pending. Although the Court of Appeal’s judgment of April 2, 2008 had acquired “[t]he
authority of a final judgment (res judicata)” in the sense of
art. 2848 of the Civil Code of Québec, S.Q. 1991, c. 64, it did not
fully and definitively adjudicate the rights and obligations of the parties
that resulted from the two partial terminations. As I
mentioned above, a pending case is one in which a final and irrevocable
judgment determining the parties’ rights and obligations has not yet been rendered.
A final judgment on an issue in a case that falls short
of a resolution of the case on its merits does not preclude an authority
responsible for the final determination of the parties’ rights and obligations
from applying declaratory legislation that has been enacted since that
judgment.
[40]
In coming to this conclusion, I do not mean to
call into question the capital importance of the doctrine of res judicata
to the administration of justice. The purpose of res judicata is to prevent the
relitigation of claims that have already been decided by a court of competent
jurisdiction. However, it seems to me that a decision to extend this doctrine
by applying it to the unique circumstances of this case would encroach unduly
upon the legislature’s prerogative to nullify the effects of a final judgment
that would otherwise be binding as between the parties. Put more simply,
whereas res judicata can preclude a party from asking a court to undo
the effects of a judgment involving a decided issue, it precludes the legislature
from undoing the effects of a judgment only if the judgment amounts to a
decided case.
[41]
In light of this Court’s existing jurisprudence, only a final judgment on the merits
of the case would preclude the application of an interpretation set out in
declaratory legislation.
[42]
The Court of Appeal’s decision resulted in a
final determination only on the question of law relating to the interpretation
of certain provisions of the Rules and their compatibility with the SPPA.
The court remitted the question of the parties’ substantive rights in light of
this interpretation to the Régie for determination. As a result, there had
been no final resolution of the dispute between the parties as of June 20,
2008. The terms of the partial termination of the Fund had yet to be
determined. The case between the parties therefore remained pending when the
declaratory provisions came into force, and a competent authority properly
charged with resolving the dispute between the parties was entitled to give
effect to those provisions in doing so.
[43]
Because the Court of Appeal had remitted the
matter to it, the Régie was a competent authority properly charged with
resolving a pending case when the declaratory provisions came into force. It
was therefore open to the Régie to take them into consideration in determining
the outcome of that case.
(2) Significance of a Decision to
Remit a Matter With Directions
[44]
In its judgment of April 2, 2008, the Court of
Appeal remitted the matter to the Régie, ordering it to review its decisions in
light of the court’s reasons. Having discussed the issue of res judicata
that flowed from the Court of Appeal’s decision, I will now turn to the issue
of stare decisis.
[45]
Multi-Marques and Sean Kelly argue that because
the Court of Appeal had remitted the matter to the Régie together with a
direction, the Régie’s jurisdiction was limited and it was bound to apply the
law as interpreted by the court regardless of developments subsequent to the
court’s decision.
[46]
This approach is erroneous because it disregards
the proper functioning of the principle of stare decisis. Where
an administrative decision-maker has a duty to follow the directions of a
reviewing court, it is on the basis of stare decisis: Canada
(Commissioner of Competition) v. Superior Propane Inc., 2003 FCA 53, [2003]
3 F.C. 529, at para. 54. It is therefore obligated to follow such directions
only insofar as they remain good law.
[47]
In the case at bar, once the matter had been
remitted to the Régie for redetermination, the Régie’s jurisdiction was limited
only by the principle of stare decisis. It was by virtue of stare
decisis that the Régie was bound to apply the Court of Appeal’s interpretation
to the case before it. When the declaratory legislation came into force,
however, it operated as a part of the jurisprudence and overruled the court’s
interpretation. This legislation then became the new binding precedent on the
question of the interpretation of certain provisions of the SPPA. The
principle of stare decisis dictates, therefore, that changes to the law
in the form of declaratory legislation that occur before a final disposition of
the litigation will negate the precedential value of directions from the
reviewing court that conflict with them. Had the law on this question been
changed in the interim by a new precedent from this Court, the Régie would have
been bound by this Court’s decision in the same way as it is bound by the legislation
in question. In the instant case, the declaratory legislation is not ambiguous,
and the National Assembly decided unanimously to counter the effect of the
Court of Appeal’s decision by enabling the Régie to interpret the SPPA
in a manner consistent with what the legislature considered to be the Act’s
true objectives. As a result of the legislature’s intervention, the Court of
Appeal’s directions became bad law. Accordingly, the Régie was not only
entitled to interpret the SPPA in light of the declaratory provisions,
it was obligated to do so.
[48]
Finally, it should be noted that under the SPPA,
the Régie was required to apply the correct law and therefore had to adopt the
meaning that, according to the declaratory legislation, the law had always had.
Since declaratory legislation applies retroactively, the SPPA is deemed
to have contained the relevant provisions since it was first enacted. Section
202 of the SPPA provides that when an employer withdraws from a
multi-employer pension plan, the pension committee must file with the Régie “a
report establishing the benefits accrued to each member and beneficiary
affected and the value thereof”. Pursuant to s. 203, the Régie may not
authorize the withdrawal unless this report is in conformity with the SPPA.
Although the Régie’s statutory obligation to issue a certificate in conformity
with the law is not the main source of its authority to disregard the Court of
Appeal’s decision, this obligation certainly lends support to the proposition
that the Régie may not apply bad law.
VI. Conclusion
[49]
For these reasons, I would allow the appeal with
costs throughout.
The reasons of McLachlin C.J.
and Fish J. were delivered by
The Chief Justice (dissenting) —
I. Introduction
[50]
In accordance with the rule of law principle, all administrative decision-makers
are subject to judicial review by courts of inherent jurisdiction. “The
function of judicial review is . . . to ensure the legality, the reasonableness
and the fairness of the administrative process and its outcomes” (Dunsmuir
v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at para. 28). An
administrative decision-maker does not have the power to second-guess the final
judgment of a court of inherent jurisdiction regarding the legality of its
decisions. This would in effect undermine the process of judicial review, and
threaten the rule of law. I am concerned that the reasons of the majority in
the present appeal do just that. They allow the Régie des rentes du Québec
(“Régie”) to disregard clear instructions from the Quebec Court of Appeal, and
to re-visit an issue that — as between the parties to this appeal — had been
definitively settled by the courts.
[51]
I agree with my colleague Wagner J. that the
legislature has the power to enact declaratory provisions which have a
retroactive effect, and that such provisions apply to all pending cases.
However, with respect for the contrary opinion, these propositions do not
resolve the present appeal. At the heart of this appeal is the question of
whether an administrative decision-maker can ignore the directions of a court
that has supervisory jurisdiction over it, and effectively reinstate its
original decision after it has been overturned in the course of judicial
review. In my view, the answer to this question is no.
II. Facts and Judicial History
[52]
I rely on my colleague’s apt summary of the
facts and judicial history relevant to this appeal.
III. Analysis
A. The Quebec Court of Appeal Definitively Settled the Legal
Issue in Dispute
[53]
It is a settled principle that laws can take
effect retroactively, so long as the legislature indicates its intention in
clear statutory language. In this way, the legislature can change the outcome
of a legal dispute, by enacting provisions which apply to a pending case.
As the British Columbia Court of Appeal stated in Barbour v. University of
British Columbia, 2010 BCCA 63, 282 B.C.A.C. 270, leave to appeal refused,
[2010] 1 S.C.R. vi:
We
consider it is clear in Canada that the Legislature may enact legislation that
has the effect of retroactively altering the law applicable to a dispute. While
a Legislature may not interfere with the Court’s adjudicative role, it may
amend the law which the court is required to apply in its adjudication. [para.
32]
(See
also British Columbia v. Imperial Tobacco Canada Ltd., 2005 SCC 49,
[2005] 2 S.C.R. 473, at paras. 69-72; Société
canadienne de métaux Reynolds ltée v. Québec (Sous-ministre du Revenu),
[2004] R.D.F.Q. 45 (C.A.), at paras. 16-17.)
[54]
However, retroactive laws do not apply to
pending legal disputes of their own force. They fall to be applied by the
administrative decision-makers or courts that have jurisdiction to resolve the
matters in dispute. When a retroactive law comes into force while a case is
being appealed, it falls to be applied by whatever level of appellate court is
seized of the matter at that time. This principle was recognized in Western
Minerals Ltd. v. Gaumont, [1953] 1 S.C.R. 345, where Cartwright J. stated:
. .
. I think it clear that the Appellate Division would be bound to give
effect to a Statute, passed after the judgment from which the appeal is taken
but before the hearing or decision of the appeal, declaring what the law is and
always has been and so, of necessity, declaring what it was at the time of the
trial. [Emphasis added; p. 369.]
The Alberta
Court of Appeal made the same point in CNG Producing Co. v. Alberta
(Provincial Treasurer), 2002 ABCA 207, 317 A.R. 171:
Although
retroactive legislation applies to pending cases, it does not apply to cases
that have reached the stage of an entered judgment. If, however, a judgment has
been entered following the trial of an action and the Legislature enacts a
retroactive statute prior to the hearing of an appeal, then the outcome of
the appeal may turn on the new statute . . . . [Emphasis added; para. 48.]
[55]
Once all avenues of appeal have been exhausted,
the authority of res judicata applies to preclude parties from
re-litigating an issue that has been decided on the merits. This is so even if
the legislature has changed the law retroactively and, as a result, the final
judgment now contains an error in law. Indeed, “the authority of res
judicata exists even when there is an error in the judgment” (Roberge v.
Bolduc, [1991] 1 S.C.R. 374, at p. 403).
[56]
In the present case, only the Supreme Court of
Canada, before which an application for leave to appeal was pending at the time
of the coming into force of the retroactive provisions, had the jurisdiction to
apply the provisions to resolve the dispute between Multi-Marques and the
pension beneficiaries. Once it denied leave to appeal, all avenues of appeal
were exhausted. Consequently, the Quebec Court of Appeal’s judgment acquired the
authority of res judicata between the parties with respect to the issue
of whether the employer’s funding obligations could be limited by clauses 9.12
and 9.13 of the Rules and Regulations for the Bakery and Confectionery Union
and Industry Canadian Pension Fund (the “Pension Fund’s Rules”) (2008 QCCA 597,
[2008] R.J.Q. 853, leave to appeal refused, [2008] 3 S.C.R. ix).
[57]
My colleague Wagner J. contends that the
declaratory provisions applied to the dispute at hand, because it was a
“pending case”. He recognizes that disputes in which there has been a final
determination of all the rights and obligations of the parties are
beyond the reach of declaratory provisions. However, he argues that so long as
there remain issues — no matter their nature — to be determined, declaratory
provisions will apply to the dispute and may negate any final judgments which
have definitively resolved certain of the legal questions at issue.
[58]
In this appeal, the precise monetary liability
of the employer was not determined by the Court of Appeal’s disposition, and
the matter was remitted back to the Régie for a computation of that liability.
In my colleague’s view, this sufficed for the dispute to remain a “pending
case” and for the declaratory provisions to apply.
[59]
I cannot agree. Courts interpret and apply
declaratory laws restrictively. These laws apply to pending cases, but do not
reopen decided cases (Western Minerals, at p. 370). The application of
declaratory laws is closely tied to the appeal process — they do not apply to a
dispute once all avenues of appeal have been exhausted. This restrictive
interpretation and application of declaratory laws is intended to preserve
stability and certainty in the legal system. It recognizes that judicial
determinations which have been obtained by parties after a full appeal process
should not be lightly disturbed.
[60]
In my view, the rationale for applying
declaratory laws restrictively suggests that my colleague’s distinction between
(i) a final judgment, and (ii) a final judgment that definitively determines all
rights and obligations of the parties (Wagner J., at para. 30), is
inappropriate in this context. Nor, in my respectful view, is there any legal
authority to support my colleague’s distinction. A judgment which definitively
settles a contested legal issue as between the parties is no less worthy of
being protected from the retroactive effects of declaratory laws than a
judgment which settles all rights and obligations in dispute.
[61]
The present appeal illustrates this. The Quebec
Court of Appeal found that the Pension Fund’s Rules effectively limited the
employer’s funding obligations, and the Supreme Court of Canada declined to
interfere with that conclusion. Following this conclusive determination, what
remained were the rather clerical tasks of collecting actuarial reports and
computing the precise monetary liability of the employer — tasks which were
left to the Régie, as they fell within its area of specialization. There were
no longer any avenues of appeal through which the Quebec Court of Appeal’s
conclusions on the employer’s funding obligations could be challenged. The
parties had sought a final determination of the issue and had obtained it,
running up the appellate ladder in the process. Yet the application of
declaratory provisions reopened litigation of a dispute whose core issues had
been definitively determined, leading the parties back up the appellate ladder.
This is precisely what the well-settled principle of applying declaratory laws
restrictively is meant to prevent.
[62]
My colleague also relies heavily on the intent
of the legislature, which he contends was specifically to negate the effects of
the Court of Appeal’s judgment as between the parties. I agree that, in theory,
the legislature has the power to extinguish all the effects of a judgment.
However, to infer that the legislature intended to extinguish the effects of a
judgment as between the parties — an extraordinary step — clear language is
required. The declaratory law in this case does not contain such language.
[63]
It is useful to distinguish between the
different effects produced by a judgment. One effect of a final judgment is to
create a precedent that courts and tribunals must follow. This effect is called
stare decisis: “. . . a court must follow earlier judicial decisions
when the same points arise again in litigation”, unless or until such decisions
are revisited or overruled by a higher court (Black’s Law Dictionary
(9th ed. 2009); Woods Manufacturing Co. v. The King, [1951] S.C.R. 504,
at p. 515). A second effect of a binding judgment is to fix the rights and
obligations of the parties, rendering the issue in dispute res judicata.
[64]
It is sufficient for the legislature to say that
a law is “declaratory” in order to deprive contrary jurisprudence of its precedential
value. However, it takes more explicit language to infer that the legislature
intended to deprive a final judgment of its authority of res judicata as
between the parties to a dispute where all avenues of appeal have been
exhausted. As the Saskatchewan Court of Appeal stated in Zadvorny v.
Saskatchewan Government Insurance (1985), 38 Sask. R. 59:
To change a law of general
application, retroactively, is one thing; to legislate the extinguishment of a
judgment is another. To satisfy us that the Legislature intended to deprive the
respondent of his judgment . . . would take the clearest of language. [para. 9]
(Cited
with approval in Hornby Island Trust Ctee. v. Stormwell (1988), 30
B.C.L.R. (2d) 383, at p. 392.)
In the
present case, the legislature chose not to use language that specifically
provided for the extinguishment of the Court of Appeal’s judgment. In the
absence of such language, it is appropriate to construe the provisions
restrictively, as only depriving the judgment of its precedential value.
[65]
In summary, I am of the view that there is no
principled basis on which to conclude that declaratory laws apply to judicial
determinations for which all avenues of appeal have been exhausted, but which
fall short of determining every issue in dispute. This runs counter to the
principle that declaratory provisions must be interpreted and applied
restrictively, and to the correlative principle that clear statutory language
is required to extinguish the effects of a judgment as between the parties. It follows
that the Court of Appeal’s judgment was final and binding: the Régie had [translation] “to review its decisions .
. . in conformity with” the Court of Appeal determination that clauses 9.12 and
9.13 of the Pension Fund’s Rules operated to limit the employer’s funding
obligations (see para. 108 of the Court of Appeal’s reasons).
B. The Régie Had No Jurisdiction to Overturn the Court of
Appeal’s Final Judgment
[66]
The Régie had no jurisdiction to revise the
Court of Appeal’s decision and apply more recent legal developments to come to
a different conclusion. The Régie was only seized of the case again because the
Court of Appeal had remitted the matter to it with directions. I am willing to
accept — as my colleague Wagner J. appears to argue — that a court’s remission
of a matter with directions to a decision-maker may sometimes revive that
decision-maker’s original jurisdiction over the matter, which would allow the
legal issues in dispute to be considered afresh. However, in my view, this only
happens if the substance of the court’s directions requires the
decision-maker to commence a fresh review of the legal matter. Here, the
substance of the Court of Appeal’s directions was that the Régie should compute
the employer’s precise monetary liability in light of the principle that the
employer’s funding obligations were limited by clauses 9.12 and 9.13 of the
Pension Fund’s Rules. The directions did not require the Régie to redetermine
the substantive rights and obligations of the employer and of the fund beneficiaries.
In so doing, the Régie acted without jurisdiction.
[67]
Orders remitting a matter to an administrative
decision-maker with directions can take many shapes. A court’s directions must
be interpreted in light of the totality of their content and of the context in
which they were given (Shuchuk v. Workers’ Compensation Board Appeals
Commission (Alta.), 2012 ABCA 50, 522 A.R. 336, at para. 23).
[68]
In Canada (Commissioner of Competition) v.
Superior Propane Inc., 2003 FCA 53, [2003] 3 F.C. 529, at para. 54, Rothstein
J.A. (as he then was) stated that clarifications of the law contained in a
court’s directions bind lower courts and tribunals pursuant to the principle of
stare decisis. In other words, the directions function as judicial
precedents. My colleague Wagner J. infers from this principle that directions
can be displaced by any change in the law which renders the legal substance of
the directions erroneous.
[69]
In my view, this conclusion is overbroad and
does not apply in all cases of remission with directions. It is important to
consider the substance of the directions. In some cases, directions merely
clarify the law, and require the tribunal to determine legal matters afresh in
accordance with these clarifications (D. J. M. Brown and J. M. Evans, with the
assistance of C. E. Deacon, Judicial Review of Administrative Action in
Canada (loose-leaf), at pp. 5-36 to 5-41). This was the case in Superior
Propane, where the Federal Court of Appeal had clarified the methodology
that the Competition Tribunal should use to determine whether a merger would
substantially prevent or lessen competition, and had remitted to the Tribunal
the legal matter of whether the merger at issue did in fact prevent or lessen
competition. In these cases, the directions function as judicial precedents —
it may well be that subsequent changes in the law will render the
clarifications erroneous and that the directions will no longer bind the
administrative decision-maker.
[70]
However, in other cases, directions may in fact
contain substantive determinations of the rights and obligations of parties,
and require the administrative decision-maker to give effect to those rights
and obligations. In these cases, the court’s determination of the rights and
obligations of the parties attracts the authority of res judicata. To
conclude otherwise is to deprive the process of judicial review of finality and
to put administrative decision-makers on an equal footing with the courts that
exercise supervisory jurisdiction over them.
[71]
In the present case, there was no authority for
the Régie’s purported jurisdiction to determine afresh whether Multi-Marques’
funding obligations were limited by clauses 9.12 and 9.13 of the Pension Fund’s
Rules. As discussed, the Court of Appeal’s directions did not instruct the
Régie to determine the matter afresh. Nor does the Régie’s enabling statute
contain any provisions that allow it to review a matter on which a higher court
has passed judgment. The Régie points to s. 26 of its enabling statute, which
holds that the Régie “may, on its own initiative, revise or cancel any
decision” (An Act respecting the Québec Pension Plan, R.S.Q., c.
R-9). However, this provision merely grants the Régie a plenary jurisdiction,
and absent clear legislative language it cannot have been intended to allow the
Régie to circumvent the process of judicial review and side-step directions
from a higher court (Shuchuk, at para. 37).
[72]
As discussed above, the Court of Appeal’s ruling
remained binding. The ruling had lost its precedential value as a result of the
declaratory provisions: the Régie would not be bound to follow its
interpretation of the law in future cases. However, the authority of res
judicata applied to it and the Régie could not disturb the Court of
Appeal’s definitive resolution of the legal issues as between the parties. It
had to fulfill the task for which the case had been remitted to it, i.e.
compute the precise monetary liability that resulted from the substantive
rights and obligations determined by the Court of Appeal. By failing to do so,
the Régie effectively circumvented the process of judicial review and
reinstated its original decision without having the jurisdiction to do so. The
majority’s reasons endorse this behaviour, and undermine the finality of all
judgments that contain a remission with directions to an administrative
decision-maker.
IV. Conclusion
[73]
For these reasons, I would dismiss the appeal
and award costs to the respondents.
Appeal
allowed with costs throughout, McLachlin C.J.
and Fish J. dissenting.
Solicitor for the appellant: Régie des rentes du Québec,
Québec.
Solicitors for the respondents the Canada Bread Company Ltd., Multi‑Marques
Inc. and Multi‑Marques Distribution Inc.: Stikeman Elliott,
Montréal.
Solicitors
for the respondent Sean Kelly, in his capacity as trustee of the Bakery and
Confectionery Union and Industry Canadian Pension Fund: Blake,
Cassels & Graydon, Montréal.
Solicitor for the
intervener the Attorney General of Quebec: Attorney General of
Quebec, Québec.