Canadian National Railway Company v. Greenstone (Municipality), 2008 FCA 395

Date: 20081212

Docket: A-541-07

Citation: 2008 FCA 395

 

CORAM:       DÉCARY J.A.

                        LÉTOURNEAU J.A.

                        NOËL J.A.

 

BETWEEN:

CANADIAN NATIONAL RAILWAY COMPANY

Appellant

and

MUNICIPALITY OF GREENSTONE

and

CANADIAN TRANSPORTATION AGENCY

Respondents

 

 

 

 

 

 

Heard at Montréal, Quebec, on December 4, 2008.

Judgment delivered at Ottawa, Ontario, on December 12, 2008.

 

 

REASONS FOR JUDGMENT BY:                                                                   LÉTOURNEAU J.A.

CONCURRED IN BY:                                                                                                DÉCARY J.A.

                                                                                                                                          NOËL J.A.

 

Date: 20081212

Docket: A-541-07

Citation: 2008 FCA 395

 

CORAM:       DÉCARY J.A.

                        LÉTOURNEAU J.A.

                        NOËL J.A.

 

BETWEEN:

CANADIAN NATIONAL RAILWAY COMPANY

Appellant

and

MUNICIPALITY OF GREENSTONE

and

CANADIAN TRANSPORTATION AGENCY

Respondents

 

 

REASONS FOR JUDGMENT

 

LÉTOURNEAU J.A.

 

[1]               The appellant challenges a decision of the Canadian Transportation Agency (Agency) on the basis of the following six grounds:

 

a)         the Agency denied the appellant a fair and unbiased treatment;

 

b)         the Agency erred in law in failing to recognize that the withdrawal of the expression of interest by the municipality of Greenstone (Municipality) on October 2, 2006 constituted a waiver of the Municipality’s right to acquire the railway lines at issue;

 

c)         the Agency erred in law when it failed to conclude that the Municipality was estopped by its conduct from making a complaint to the Agency;

 

d)         the Agency erred in law when it failed to consider the estoppel arguments in its reasons in support of its decision;

 

e)         the Agency erred in law when it determined that once a railway line is mentioned in a railway company’s three-year plan pursuant to section 141 of the Canada Transportation Act, S.C. 1996, c. 10 (Act) as a line that the company intends to discontinue, it cannot thereafter take steps to discontinue only a portion of that line unless it modifies its three-year plan;

 

f)          the Agency erred in law when it found that the advertisement requirement provided at subsection 143(1) of the Act, and the steps to follow, must necessarily include the entire railway line indicated in a railway company’s three-year plan as a candidate for discontinuance.

 

 

[2]               The appellant also alleges that the errors here-above-mentioned in paragraph b) to f) constituted jurisdictional errors. As usual, there is the debate as to the standard of review applicable to the decision of the Agency.

 

[3]               It is useful at this point to reproduce the relevant provisions of the Act applicable at the time:

 

 

THE FACTS AND PROCEDURE

 

[4]               The Municipality did not participate in these appeal proceedings. Pursuant to an Order of Sharlow J.A., dated March 25, 2008, the Agency, who had filed a notice of appearance, was added as a respondent.

 

[5]               On December 6, 2004, the appellant listed part of the Kinghorn Subdivision in the province of Ontario as a discontinuance candidate on its Three-Year Rail Network Plan (Plan). According to the Plan, the line from mileage 0.00 to 195.60 would be discontinued: see appeal book, tab 3, at page 20.

 

[6]               The Plan was revised on October 19, 2006. It indicated that the line would be discontinued from mileage 1.70 to 193.00: ibidem, at page 31.

 

[7]               In accordance with section 143 of the Act, the appellant advertised in national and local newspapers a Notice of Discontinuance of Railway Lines (Notice) which described the line that it intended to discontinue and solicited an expression of interest from potential buyers.

 

[8]               The Notice contained a description of the line which differed from the one appearing in the revised Plan. The description read as follows:

 

 

Kinghorn Subdivision in the province of Ontario

between a point near Longlac (mile 1.7 Kinghorn Subdivision)

and a point near Red Rock (mile 130.0 Kinghorn Subdivision)

and

between a point near Black Sturgeon River

(mile 138.1 Kinghorn Subdivision) and point near Thunder Bay

(mile 193.0 Kinghorn Subdivision)

 

 

 

[9]               Essentially, the description exempted from discontinuance a portion of 8.1 miles comprised between mile 130.0 and 138.1: ibidem, tab 4, at page 39.

 

[10]           At the beginning of May 2006, the Municipality informed the appellant in writing that it had an interest in acquiring the line: ibidem, tab 5, at page 41. After discussions between the two parties, the appellant was informed on October 2, 2006 that neither the Municipality nor the Greenstone Economic Development Corporation, which, in conjunction with the Municipality, had shown an interest in the line, would submit an offer to acquire it: ibidem, tab 15, at page 70.

 

[11]           However, in that letter to the appellant, the Municipality reserved its rights to acquire the line for its net salvage value once the line had been offered to governments pursuant to section 145 of the Act: ibidem.

 

[12]           The appellant proceeded to offer to sell to the various governments mentioned in section 145 of the Act its interests in the line for no more than its net salvage value: ibidem, tab 17, at pages 72 to 85.

 

[13]           On March 2, 2007, the Municipality wrote to the Agency to inform it of its interest in acquiring the appellant’s line as described in the Notice, i.e. Longlac Ontario MP 1.70 to Red Rock Ontario MP 130.0 and Black Sturgeon River MP 138.1 to Thunder Bay MP 193.0, when sold for the net salvage value: ibidem, tab 18, at pages 86 to 88. It also sought the assistance of the Agency in determining as soon as possible the net salvage value of the line.

 

[14]           This letter of March 2 was followed by a letter of March 13, 2007 in which the Municipality sought clarification from the Agency as to what portions of the line were in fact offered to the governments under section 145 of the Act: ibidem, tab 20, at pages 90 and 91. It pointed out an alleged discrepancy between the Plan available on the appellant’s website and what the appellant was offering to it and others. The website, which indicated that the site had been revised on February 8, 2007, continued to state that the entire section from mile 1.7 to 193.0 was discontinued while the letters of offer from the appellant subtracted 8.1 miles, i.e. the distance between mile 130.0 to 138.1.

 

[15]           Pursuant to the Municipality’s application for clarification, the Agency requested comments from the appellant on the Municipality’s application. The Municipality was given 10 days from the receipt of the appellant’s comments to file its reply with the Agency and send a copy to the appellant: ibidem, tab 21, at page 93.

 

[16]           In response to the Agency’s request for comments, the appellant, in a letter dated April 17, 2007 submitted there was no discrepancy between the mileages indicated in the Plan, what was advertised for sale in the newspapers and what was offered to the governments pursuant to section 145 of the Act: ibidem, tab 22, at page 96.

 

[17]           On May 9, 2007, the Municipality officially complained to the Agency that the appellant failed to adhere to the requirements of the Act by not offering to the Municipality the entire line as currently described in the three-year Plan on December 6, 2004: ibidem, tab 25, at page 102.

 

[18]           No government showed an interest in buying the line. The appellant then gave notice to the Agency that operations on the lines would be discontinued as of May 31, 2007.

 

[19]           The Agency proceeded to adjudicate on the Municipality’s complaint. It rendered its decision on July 13, 2007 and concluded that the appellant had failed to comply with the transfer and discontinuance process set out in Part III, Division V of the Act. It ordered the appellant to either restart the transfer and discontinuance process by revisiting its three-year Plan or continue the process from the point that it last revised its Plan, i.e. October 19, 2006. Hence the appeal from the Agency’s decision.

 

ANALYSIS

 

The standard of review

 

[20]           The parties have argued different standards of review for the various grounds of appeal. As some of the grounds are without merit, there is no point in engaging into a discussion in the abstract as to the appropriate standard of review. I will discuss the issue where it matters and when the parties do not agree on the applicable standard.

 

Whether there was a breach of natural justice by the Agency

 

[21]           There is no dispute that the applicable standard is correctness. The appellant’s contention is that the Agency either decided the matter before it received the appellant’s submissions or gave the appearance that the matter was already decided.

 

[22]           The appellant’s assertion is based on the following excerpt from an affidavit of Mr. Iain Angus whose consulting firm was retained by the Municipality:

 

10.     Around the time of this letter, I contacted the CTA on several occasions, on the Municipality’s behalf, regarding the NSV assessment process and the potential for an extension of the government acquisition process minimum standard deadlines. During one of these conversations with the CTA, I was informed by the CTA that CN was required to offer the same Kinghorn Subdivision line for acquisition, pursuant to section 145 of the Act, as it had listed in its Three Year Rail Network Plan of December 6^th, 2004, required by section 141 of the Act. The CTA also informed me of a CTA precedent on this very issue.

 

                                                                                                                                [Emphasis added]

 

The underlined sentence is the passage relied upon by the appellant.

 

[23]           There is evidence on the record that the Municipality was not familiar with the process and sought the assistance of the Agency. It is in that context that the attention of the Municipality was drawn to a decision that the Agency had previously rendered on the issue therein mentioned. As it turns out, the appellant now claims the information was erroneous.

 

[24]           The impugned statement is too broad and too vague to ground a finding or a reasonable inference that the Agency had already decided the issue in the appellant’s case. The affiant was not cross-examined by the appellant. We do not know who in the Agency gave the information to Mr. Angus. As counsel for the respondent submitted, no panel had been struck at that time to hear the appellant’s case. It is also current practice for employees in administrative boards to provide information to members of the public who seek their assistance. It would be a finding made on pure speculation if I were to conclude that the information as to the existence of a precedent was given by a member of the panel which later heard the appellant’s case. It would be both wrong and unreasonable to accept the appellant’s submission that the impugned statement establishes that the Agency had decided or appeared to have decided the matter in the appellant’s case.

 

Whether the Municipality waived its right to acquire the railway lines at issue

 

[25]           I see no merit in the contention that the Municipality waived its right to acquire the railway lines at issue. In the October 2, 2006 letter addressed to the appellant, the Municipality clearly reserved its right to acquire the line for its net salvage value.

 

 

 

Whether the Agency erred when determining that once a railway line is published in a railway company’s three-year plan pursuant to section 141 of the CTA as a line that the company intends to discontinue, it cannot thereafter take steps to discontinue only a portion of that line unless it modifies its three-year plan

and

Whether the Agency erred when it found that the advertisement requirement provided at subsection 143(1) of the Act, and the steps to follow, must necessarily include the entire railway line indicated in a railway company’s three-year plan as a candidate for discontinuance

 

 

[26]           Quoting from an earlier decision (Decision No. 542-R-2000 dated August 17, 2000) the Agency recognized that a railway company can revise and alter its interest in a railway line according to subsection 144(5) of the Act and amend its plan. However, the Agency ruled that when a railway company does that, it must restart the discontinuance process as set out in Division V of the Act. This is illustrated by the following excerpt from paragraph 16 of the Agency’s decision:

 

[16]     The statutory transfer process established by Division V Part III of the CTA contemplates that the railway line that is listed on the Three Year Plan pursuant to subsection 141(1) of the CTA, advertised for transfer pursuant to subsection 143(1) of the CTA and transferred to governments pursuant to subsection 145(1) of the CTA be consistent. This does not prevent CN to alter or revise its interest according to subsection 144(5) of the CTA, however if it chooses to do so, it must then restart the discontinuance process as set out in Division V of the CTA.

 

                                                                                                                                [Emphasis added]

 

[27]           This conclusion of the Agency results from its interpretation of subsection 142(2) of the Act. For convenience, I repeat here the content of the provision which states:

 

 

 

a)         The scope and purpose of subsection 142(2)

 

[28]           It is true as contended by the appellant that the purpose of Bill C-101 introduced in the House of Commons on June 20, 1995 was to reform the existing conveyance and abandonment procedures with a view to streamlining and shortening the current process for rail line rationalization so as to make it commercially oriented, less adversarial and more conducive to the sale or lease of surplus rail lines to new operators: see appeal book, tab 22, the document entitled Rail Lines: Current Conveyance and Abandonment Procedures and Replacement Proposals in Bill C-101. At page 2 of this document, David Johansen of the Law and Government Division writes:

 

Insofar as rationalization of the rail network is concerned, the bill would shift the focus from the current abandonment of underused rail lines to the development of a healthy short line industry (i.e. local rail carriers). The proposed streamlined rail rationalization process is thus designed to encourage the sale or lease of rail lines to short line operators. According to departmental sources, approximately two-thirds of the rail lines in Canada that are likely candidates for rationalization could support viable short line operations.

 

 

[29]           According to subsection 142(2), a railway company must state in its plan its intention to discontinue operating a railway line and, then, wait twelve (12) months before taking the steps leading to discontinuance.

 

[30]           The subsection was enacted to provide a measure of protection to those who will be affected by the discontinuance of a railway line. It affords a period of time within which individuals, groups, shippers, investors or potential buyers may inquire as to the rentability of the line and make whatever material, financial or alternate arrangements are appropriate and needed to protect their respective interests.

 

[31]           The period of time allotted was two (2) months until an amendment in 2000 brought by Bill C-34 (S.C. 2000, c. 16) extended it to twelve (12) months. In this respect, the Minister, the Honourable David M. Collenette, made the following statement on moving the Bill to third reading:

 

… We have included in this bill, because of the urgency and the need for balance in the system, specific provisions that would not only allow the two railways to reduce their costs, but facilitate the transfer of branch lines for continued operation.

 

We are extending the notice period before a railway can take steps to discontinue a rail line from two months to twelve months. This would give more time for potential short line purchasers to come along. It would also allow a community based group which is ready to proceed with an offer to trigger an early curtailment of the twelve month notice period and extend the negotiation period from four months to six months. Also, either party may request the Canadian Transportation Agency during this stage to provide its estimate of the net salvage value of the line. (See the Edited Hansard, Number 114, 36^th Parliament, 2^nd session, June 14, 2000.)

 

                                                                                                                                [Emphasis added]

 

[32]           The scheme put in place by Division V of the Act is an attempt to reconcile the interests of both the railway companies and the users of the discontinued lines offered for sale.

 

[33]           The Agency was aware of and sensitive to this dual legislative objective. Such awareness is reflected in the following passages of its decision at paragraphs 16 and 19:

 

[16]     The Agency finds that changing the nature of the interest in the railway line can present undue hardship to potential purchasers by way of creating uncertainty as to the interest that is included in the transfer. The Agency expects railway companies that propose to discontinue or transfer railway lines to exercise due diligence in ensuring that the nature and extent of all their interests they wish to transfer or discontinue are fully represented and clearly articulated from the outset, rather than subsequently revising or amending the offer when the lines are to be transferred to governments.

 

…

 

[19]     The Agency notes that one of the key components of the CTA is to provide a more commercially oriented process for railway companies to sell or lease surplus railway lines to new operators, rather than discontinue service. The steps outlined in the CTA for the transfer or discontinuance of railway lines were established not only to allow parties to consider operating a short line railway over the line, but also to allow shippers on the line to make alternate arrangements in the event it is discontinued and to provide levels of government an opportunity to decide whether to purchase the line. The process provides time frames for interested parties to review their options, and their plans can be hampered when the “railway line” offer changes. Therefore, the Agency sees inconsistencies or changes in the “railway line” during the process as contraventions to the intent of Parliament and the existing legislation.

 

                                                                                                                                [Emphasis added]

 

[34]           This brings me to an analysis of the core issue in this appeal, i.e. the interpretation given by the Agency to subsection 142(2) of the Act.

 

b)         The interpretation given by the Agency to subsection 142(2) of the Act

 

[35]           Paragraphs 17 and 18 of the Agency’s decision contain the gist of that decision:

 

[17]     The Agency notes that, in this case, CN indicated in its three-year plan dated December 6, 2004 that it intended to discontinue the Kinghorn Subdivision from mileage 0.0 to 195.6. Yet, in its advertisement dated April 24, 2006 pursuant to section 148 of the CTA, CN offered for sale, lease or transfer the portions of the Kinghorn Subdivision from mileage 1.7 to 130.0 and from mileage 138.1 to 193.0. As the “railway line” identified in the three-year plan was not consistent with the “railway line” that was offered for sale, lease or transfer, the Agency finds that CN failed to comply with the transfer and discontinuance process set out in Part III, Division V of the CTA. The Agency is of the opinion that the Municipality’s interest in acquiring the railway line has been affected by the changes to CN’s description of the railway line.

 

[18]     The Agency reiterates that once a “railway line” has been identified in the three-year plan, the same “railway line” should be offered throughout the steps of the transfer and discontinuance process. The Agency is of the opinion that changing the mileage points or portions of the “railway line” during the process frustrates the intent of the CTA.

 

 

[36]           The approach taken by the Agency, whereby the 12-month delay period before a railway company can take steps to discontinue operating a line is triggered anew when the company brings changes to its plan, is consistent with earlier decisions and the interpretation it gave to subsection 142(2) of the Act in these decisions: see Decision No. 445-R-1997, July 11, 1997, at page 4; Decision No. 542-R-2000, August 17, 2000 at pages 6 and 7.

 

[37]           The appellant argues that the interpretation given by the Agency to the subsection fails to take into account the fact that the definition of “railway line” in subsection 140(1) includes a portion of a railway line. Thus, the argument goes, portions of a line can be subtracted from the whole line announced in a three-year plan. In the present instance, the appellant, having announced a discontinuance of mile 1.7 to mile 193.0, submits that it could subtract the portion between mile 130.0 and mile 138.1 in subsequent advertisements.

 

[38]           In addition, the appellant contends that the interpretation retained by the Agency is costly, prejudicial and time-consuming for railway companies. In contrast, interested buyers would suffer no prejudice if the discontinuance process were allowed to continue when portions of the line are deleted from the initial offer because they would have obtained all relevant information regarding the discontinuance of the whole line. They could then quickly make the adjustments to their own interest.

 

[39]           I think the appellant’s contention fails to take into account other likely scenarios. It may be that persons who refrained from participating in the process because of the extent of the discontinuance announced could become interested when the discontinuance is later reduced and becomes more affordable or manageable for them. These persons would be deprived of the benefit of the 12-month period necessary to make their assessment as well as needed material and financial arrangements. Thus, an opportunity to continue in the public interest the operation of a portion of the line could be lost. I am convinced that this is not what Parliament intended.

 

[40]           In view of the wording of subsection 142(2) and the definition of “railway lines” in subsection 140(1), I think that the interpretation suggested by the appellant runs counter to both the text of subsection 142(2) and the legislative intent.

 

[41]           The prohibition in subsection 142(2) to start the discontinuance process applies not only when there is discontinuance of a line, but also, as envisaged by the definition of “railway lines”, when there is discontinuance of “a portion of a railway line”. This is the conclusion reached by the Agency. It is one which, in my view, meets the letter and the spirit of the provision as well as the objectives of the Act.

 

[42]           The interpretation given by the Agency to subsection 142(2) is also reasonable. The discontinuance process, once engaged by the advertisement mentioned in subsection 143(1), is governed by short, strict and mandatory time-limits within which an agreement between purchasers and a railway company must be reached and the sale or transfer process completed. In Canadian National Railway Company and Canadian Pacific Railway Company v. Canadian Transportation Agency, A-355-07, May 29, 2008, Noël J.A. stressed that point when reviewing the terms and conditions of the discontinuance process in Division V. At paragraph 48 of his reasons for judgment, he wrote:

 

[48]     Indeed, Division V is a complete code which operates in accordance with a definite time line. It is couched in mandatory terms and the detailed steps which must be followed leave no doubt about when the process begins and when it ends. Amongst those steps is the railway’s obligation to offer the line for sale to the relevant public bodies for its net salvage value if no agreement is reached within the sic month period (subsection 145(2)). In my view, the corresponding right to acquire the line at its net salvage value which accrues to the relevant public bodies by the operation of subsection 145(1) at that juncture, eliminates the possibility that the parties on consent, or the Agency by order, could extend the six month statutory period. Neither the parties nor the Agency can effectively do away with the right which accrues to public bodies by the operation of the statute.

 

                                                                                                                                [Emphasis added]

 

[43]           In this context, the protection afforded by the 12-month period to potential purchasers before the discontinuance process can be formally engaged takes all its significance in view of the stated objective of “giving more time for potential short line purchasers to come along”: see the quoted statement of the Minister, supra.

 

 

 

c)         The standard of review applicable to the decision of the Agency

 

[44]           As previously mentioned, the core issue in the Agency’s decision is its interpretation of subsection 142(2). The appellant submits that it involves a pure question of law on a matter which is not technical and within the specific expertise of the Agency. Therefore, this Court should apply the standard of correctness. In any event, the appellant says that even on the deferential standard of reasonableness, the Agency’s decision “does not fall within a range of intelligible and acceptable outcomes”: see appellant’s memorandum of facts and law at paragraph 59.

 

[45]           Unsurprisingly, the respondent argues that the applicable standard is reasonableness pursuant to the decision of the Supreme Court of Canada in Dunsmuir v. New Brunswick, 2008 SCC 9. Deference is required here, counsel says, because the Agency is interpreting its own statute on an issue closely connected to its function, with which it has particular familiarity. She quotes Bastarache J. at paragraph 54 of the Dunsmuir decision.

 

[46]           I have already concluded that the Agency’s decision is correct and reasonable. I agree with the respondent that deference should be given to the Agency’s decision on the interpretation of subsection 142(2). The discontinuance process found in Division V of the Act raises an issue within the expertise of the Agency. It is one with which the Agency has familiarity. The Agency was entrusted with the monitoring of the process to ensure implementation of the government’s policy and the legislative intention. It is in performing that function that the Agency was called upon to interpret its own statute. It is an interpretation closely connected to its functions.

 

[47]           The appellant relied on two decisions of this Court to justify its claim that correctness was the standard to be applied.

 

[48]           The first is a decision of Rothstein J.A. in Canadian Pacific Railway v. Canadian Transportation Agency, 2003 FCA 271 involving the interpretation of paragraph 150(3)(b) of the Act which relates to the reasonableness of a railway company’s demurrage revenues. Rothstein J.A. found that the interpretation of that paragraph was not a “polycentric” question involving the balancing of interests and one which fell in the expertise of the Agency: see paragraphs 18 and 19 of his reasons for judgment. In our instance, the question involves a balancing of interests and as previously stated falls in, and calls for, the expertise of the Agency which is familiar with the discontinuance process and entrusted with the duty of conciliating its fairness and its efficiency. Our case is distinguishable from the case cited by the appellant.

 

[49]           Moreover, Rothstein J.A.’s decision predates the decision of the Supreme Court of Canada in Dunsmuir and has to be reviewed according to the meaning assigned to “reasonableness” by the Supreme Court in Dunsmuir. As Bastarache J. said at paragraph 47 of his reasons for judgment:

 

[47]     Reasonableness is a deferential standard animated by the principle that underlies the development of the two previous standards of reasonableness: certain questions that come before administrative tribunals do not lend themselves to one specific, particular result. Instead, they may give rise to a number of possible, reasonable conclusions. Tribunals have a margin of appreciation within the range of acceptable and rational solutions. A court conducting a review for reasonableness inquires into the qualities that make a decision reasonable, referring both to the process of articulating the reasons and to outcomes. In judicial review, reasonableness is concerned mostly with the existence of justification, transparency and intelligibility within the decision-making process. But it is also concerned with whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law.

 

                                                                                                                                [Emphasis added]

 

[50]           In my view, the decision of the Agency in this instance meets the criteria of the definition of reasonableness. There may be other possible interpretations of the prohibition in subsection 142(2). However, bearing in mind the objectives of the Act and the intent and spirit of the subsection, I cannot conclude that the decision of the Agency is not an “acceptable outcome defensible in respect of the facts and law” and, therefore, is unreasonable.

 

[51]           The second precedent invoked by the appellant is the decision of our colleague Noël J.A. in Canadian National Railway Company and Canadian Pacific Railway Company v. Canadian Transportation Agency, supra. In that case, our colleague applied a standard of correctness. However, that case is also distinguishable. The issue was one of jurisdiction in the narrow sense as defined in Dunsmuir, paragraph 30, namely whether or not the Agency had the authority to conduct the inquiry (see paragraph 20 of Noël J.A.’s reasons which sets out the jurisdictional issues). In our case, the issue is not jurisdictional. It relates to an interpretation of a provision of the Act which the Agency is required to make in the exercise of its jurisdiction pursuant to a complaint.

 

d)         Conclusion on the standard of review

 

[52]           For these reasons, deference ought to be given to the Agency for its interpretation of the prohibition contained in subsection 142(2) of the Act.

 

Whether the Agency erred in law in failing to conclude that the Municipality was estopped by its conduct from making a complaint to the Agency and whether the Agency erred in failing to consider the estoppel arguments in its reasons in support of its decision

 

 

[53]           The appellant submits that the Municipality was estopped from lodging a complaint to the Agency because it participated in the discontinuance process without objecting to it. Relying upon Black’s Law Dictionary, the appellant defines estoppel as “an affirmative defence alleging good-faith reliance on a misleading representation and an injury or detrimental change in position resulting from that reliance”: see appellant’s memorandum of facts and law at paragraph 86.

 

[54]           The definition endorsed by the appellant speaks of a positive defence, raised by a person alleging that, in good faith, he or she relied upon a misleading representation and, as a result, suffered a prejudice or changed position to his or her detriment.

 

[55]           It is certainly not clear to me how estoppel as defined by the appellant applies in this case. The defence is raised by the appellant. I cannot see how the appellant was misled by the Municipality. If anything, it is the Municipality which complains of having been misled by the appellant’s Plan and its subsequent letters to governments. In addition, no evidence of prejudice was filed by the appellant nor is there any evidence that the appellant changed its position as a consequence of relying upon a misleading representation made by the Municipality.

 

[56]           In any event, Division V of the Act establishes a mandatory process for the discontinuance of railway lines. The appellant is under a clear and positive statutory duty to comply with the obligations therein that are imposed upon it. An interested or potentially interested buyer of the lines, such as the Municipality in the present instance, cannot through consent, its participation or its conduct in the process relieve a railway company of its statutory obligations: see Kenora Hydro v. Vacationland Dairy, [1994] 1 S.C.R. 80; Canadian National Railway Company and Canadian Pacific Railway Company v. Canadian Transportation Agency, supra. I cannot accept the appellant’s contention with respect to this ground of appeal.

 

[57]           In view of the conclusion that I have reached, it is not necessary to determine whether the Agency erred in not considering the estoppel arguments in its reasons for its decision.

 

CONCLUSION

 

[58]           For these reasons, I would dismiss the appeal.

 

 

“Gilles Létourneau”

 

“I agree

            Robert Décary J.A.”

 

“I agree

            Marc Noël J.A.”

 

FEDERAL COURT OF APPEAL

 

NAMES OF COUNSEL AND SOLICITORS OF RECORD

 

 

 

DOCKET:                                                      A-541-07

 

 

STYLE OF CAUSE:                                      CANADIAN NATIONAL RAILWAY

                                                                        COMPANY v. MUNICIPALITY OF

                                                                        GREENSTONE and CANADIAN

                                                                        TRANSPORTATION AGENCY

 

 

PLACE OF HEARING:                                Montréal, Quebec

 

DATE OF HEARING:                                  December 4, 2008

 

REASONS FOR JUDGMENT BY:             LÉTOURNEAU J.A.

 

CONCURRED IN BY:                                 DÉCARY J.A.

                                                                        NOËL J.A.

 

DATED:                                                         December 12, 2008

 

 

APPEARANCES:

 

Michel Huart Eric Harvey	FOR THE APPELLANT
Andray Renaud	FOR THE RESPONDENTS

 

SOLICITORS OF RECORD:

 

Langlois Kronström Desjardins, L.L.P. Montréal, Quebec	FOR THE APPELLANT
Legal Services Directorate Gatineau, Quebec	FOR THE RESPONDENTS