VIA Rail Canada Inc. v. Canadian Transportation Agency, 2005 FCA 79

Date: 20050302

Docket: A-238-04

Citation: 2005 FCA 79

CORAM:        DÉCARY J.A.

SEXTON J.A.

EVANS J.A.

BETWEEN:                                                                                       

                                                        VIA RAIL CANADA INC.

                                                                                                                                            Appellant

                                                                           and

                                        CANADIAN TRANSPORTATION AGENCY

and COUNCIL OF CANADIANS WITH DISABILITIES

                                                                                                                                      Respondents

                                       Heard at Toronto, Ontario, on November 22, 2004.

                                  Judgment delivered at Ottawa, Ontario, on March 2, 2005.

REASONS FOR JUDGMENT BY:                                                                              SEXTON J.A.

CONCURRED IN BY:                                                                                                 DÉCARY J.A.

CONCURRING REASONS BY:                                                                                    EVANS J.A.

Date: 20050302

Docket: A-238-04

Citation: 2005 FCA 79

CORAM:        DÉCARY J.A.

SEXTON J.A.

EVANS J.A.

BETWEEN:

                                                        VIA RAIL CANADA INC.

                                                                                                                                            Appellant

                                                                           and

                                        CANADIAN TRANSPORTATION AGENCY

and COUNCIL OF CANADIANS WITH DISABILITIES

                                                                                                                                      Respondents

                                                    REASONS FOR JUDGMENT

SEXTON J.A.

[1]                This is an appeal from two decisions of the Canadian Transportation Agency (the "Agency"), wherein it was determined that concerns raised by the Council for Canadians with Disabilities (the "CCD") in regard to VIA Rail Canada Inc.'s ("VIA") newly-purchased passenger rail cars (the "Renaissance cars") constituted undue obstacles to the mobility of persons with disabilities (specifically persons in wheelchairs) and the consequent order for VIA to take corrective measures to eliminate those obstacles.

Facts

[2]                On December 1, 2000, VIA purchased 139 Renaissance cars for $139 million, which increased the size of its fleet by approximately one third. These cars had been developed in Europe in 1990 and had been designed for fast overnight service between Europe and the northern regions of the United Kingdom through the Channel Tunnel. However, the original contract was halted in 1998 and the trains were offered for sale at what VIA considered to be a bargain price. VIA purchased the Renaissance cars and at the time of purchase, the cars were fully designed and partially assembled such that they would be ready for use after final assembly.

[3]                Upon learning of VIA's plans, on December 4, 2000, the CCD applied to the Agency for interim relief pursuant to sections 27 and 28 of the Canada Transportation Act S.C. 1996, c. 10 [the "CTA"] and for a final order pursuant to subsection 172(1). Specifically, the CCD, believing that the sale had not yet been completed and without having personally inspected the Renaissance cars, asked the Agency to delay or stop VIA from purchasing them because they were not accessible for persons in wheelchairs. The CCD asked the Agency to examine the Renaissance cars to determine whether they contained "undue obstacles" to the mobility of such persons.

[4]                Since VIA had already purchased the Renaissance cars, the Agency did not attempt to stop the purchase. It instead proceeded to consider whether the Renaissance cars constituted undue obstacles to persons in wheelchairs by undertaking an examination of the Renaissance cars. Except for a one-day oral hearing on April 8, 2002, the proceeding consisted entirely of letter submissions and responses by the parties and the Agency. Similarly, the Agency rendered most of its decisions on various issues by letter.

[5]                This has been a lengthy and involved proceeding. It commenced on December 4, 2000 and the Agency rendered its final decision more than 2 years and 9 months later, on October 29, 2003. In the record, there were approximately 47 letters from the CCD, 57 letters from VIA, 10 from the Agency and 71 letter decisions and orders issued by the Agency. The matters adjudicated by letter largely dealt with production of documents, timeliness of responses, inspection of the Renaissance cars and Agency jurisdiction.

[6]                The proceeding culminated with two decisions, both of which are the subject of this appeal.

Preliminary Decision

[7]                On March 27, 2003, the Agency issued Decision No. 175-AT-R-2003 (the "Preliminary decision"), being a decision of the majority of a 3-member panel. At issue were 46 concerns raised by the CCD regarding the accessibility of the Renaissance cars. The Agency inspected the Renaissance cars and issued this decision containing its preliminary findings. Of the 46 items raised by the CCD, the Agency found 14 of them to be "undue obstacles". The Preliminary decision is lengthy and detailed and took over two years to be released. After the Agency had made the preliminary findings regarding certain features of the Renaissance cars, it directed VIA to specifically address the findings in its Direction to Show Cause (the "Show Cause Order"), wherein VIA was directed to file answers to 9 complex questions within 60 days from the date of the decision. VIA subsequently filed a response to the Show Cause Order and the Agency, finding the response to be inadequate, gave VIA an additional 60 days to provide further response.

[8]                The third and dissenting member, Richard Cashin, did not find any of the obstacles to be "undue". However, Mr. Cashin retired before the Agency rendered its final findings but the Agency's decision-making process was unaffected, since two members constitute a quorum pursuant to subsection 16(1) of the CTA.

Final Decision

[9]                Decision No. 162-AT-R-2003 (the "Final decision") was issued on October 29, 2003. Here, the Agency made final determinations on its preliminary findings of undue obstacles. As one of the preliminary issues in this decision, the Agency found that VIA's response to the Show Cause Order had been inadequate.

[10]            After addressing the specific undue obstacles, the Agency directed VIA to take corrective measures by re-designing and re-constructing certain aspects of the Renaissance cars that were placed in service. The Agency required that VIA, within 60 days of the date of the Final decision, submit its plan for the timing of the implementation of the modifications as required in the Final decision.

[11]            After the Final decision was released, VIA brought a motion to stay both the Preliminary and Final decisions pending this Court's decision on the motion for leave to appeal. The stay was granted by Order dated December 19, 2003 and renewed on June 10, 2003.

[12]            Leave to appeal to the Federal Court of Appeal was granted by Order dated March 10, 2004 on the following grounds:

(a) The Agency committed errors of law and jurisdiction by undertaking an examination of an alleged design problem in the train set or consist comprising Renaissance cars, rather than examining an alleged physical problem encountered by an actual passenger with disabilities. The Agency, therefore, erred in law and exceeded its jurisdiction in adjudicating a complaint under section 172 of the Canadian Transportation Act on hypothetical facts upon which there could be no finding of any "obstacle".

(b) Even if the Agency could have found, in the circumstances of this case, that one or more features of the Renaissance cars constituted an obstacle to the mobility of persons with disabilities, it erred in law in finding such obstacles to be "undue". The Agency failed to apply the correct legal test in its determination of "undueness".

(c) The Agency's order is patently unreasonable because it is not rationally connected to any finding of undue obstacle open on the facts of this case.

(d) The Agency erred in law and exceeded its jurisdiction by failing to afford VIA Rail its rights of natural justice and procedural fairness.

VIA's Arguments

[13]            VIA's submissions consisted of four arguments. First, it argued that the Agency's jurisdiction pursuant to section 172 to consider the existence of obstacles is derived from actual incidents involving disabled passengers. If no such incident or complaint has occurred, VIA maintains that the Agency's only recourse is to pass regulations under section 170. These regulations must be approved by the Governor in Council. Here, there was no complaint nor incident and the Agency did not pass regulations. Therefore, VIA maintains that the Agency was without jurisdiction to make such an order.

[14]            Second, VIA submits that the Agency failed in its determination of whether an undue obstacle exists in the network as a whole. Such an analysis requires a balancing exercise, to be done while taking into account the criteria from section 5 of the CTA, which VIA maintains the Agency failed to undertake.

[15]            VIA says that a wrong result by the Agency, that the Renaissance cars had undue obstacles, was unavoidable, due to the Agency having asked itself the wrong question. The correct conclusion would have addressed whether there are undue obstacles in the network as a whole.

[16]            Third, VIA argued that the remedy ordered by the Agency was not rationally connected to the undue obstacles found. Rather, VIA found the Agency's order to be disproportionate and excessive since it bore no relationship to the minor impediments to the mobility of persons in wheelchairs. The Agency ordered corrective measures, regardless of the cost, disregarding the need for a network that is economical, efficient, adequate, viable and available to serve the needs of all travellers.

[17]            Fourth, VIA submits that its procedural fairness rights were denied when the Agency refused to grant an oral hearing. Accordingly, VIA argued that the Agency's order should be quashed and the matter remitted back to it.

Legislation

[18]            There are several provisions of the CTA that must be set out:

ANALYSIS

Jurisdiction

[19]            VIA argued that the Agency lacked jurisdiction to inquire under section 172 of the CTA unless an actual incident occurred wherein a disabled individual encountered an undue obstacle to his or her mobility. Accordingly, if no incident has occurred, VIA maintains that the Agency had no jurisdiction to look into a matter.

[20]            Rather, VIA argued that the Agency's only jurisdiction to act in this matter was to determine potential undue obstacles pursuant to section 170, which permits the Agency to make regulations to eliminate undue obstacles in the network.

[21]            The parties agreed that there had been no previous case in which the Agency had purported to act under section 172 where no incident had occurred.

Jurisdictional Question: Standard of Review

[22]            When the court is reviewing decisions of administrative tribunals, the pragmatic and functional approach must be applied. (See Dr. Q v. College of Physicians and Surgeons of British Columbia, [2003] 1 S.C.R. 226 at paragraph 25). The factors to be considered in this approach are the (1) presence or absence of a privative clause or statutory right of appeal; (2) expertise of the tribunal; (3) purpose of the legislation and the provision; and (4) nature of the question.

[23]            First, section 41 of the CTA contains a statutory right of appeal with leave from a decision of the Agency, which suggests a less deferential standard of review. In fact, this Court, in commenting on the statutory right of appeal in the CTA on questions of law or jurisdiction, has decided that once leave is granted, the Agency should be allocated a lower level of deference (Canadian Pacific Railway Co. v. Canada (Canadian Transportation Agency), [2003] 4 F.C. 558 (C.A.) at para. 17 [Canadian Pacific Railway]).

[24]            The second factor, relative expertise, is a comparison of the court's expertise to that of the administrative tribunal's and calls for greater deference when the tribunal has more expertise in the particular subject matter than the court (Dr. Q, supra, at paragraph 28). Here, the Agency had to determine its jurisdiction to deal with this problem through the interpretation of sections 170 and 172 of the CTA. As this Court determined in Canadian Pacific Railway, supra, questions of statutory interpretation are within the expertise of the courts, so this also calls for a less deferential standard of review (Canadian Pacific Railway, supra, paragraph 18).

[25]            The third factor is the purpose of the legislation and the provision at issue. The Agency implements the regulatory provisions of the CTA, which provide for more deference to the Agency. However, the provisions at issue are contained in Part V of the CTA and have a human rights aspect to them (Agency's Preliminary decision at page 15). Therefore, a lower level of deference is required (Canadian Pacific Railway, supra, paragraph 19.)

[26]            Finally, the nature of the question must be determined. Questions of statutory interpretation are legal and therefore militate in favour of less deference (Dr. Q, supra, at paragraph 34).

[27]            Taken together, the factors point to a correctness standard on the jurisdictional question.

Interpretation of CTA

[28]            In my view, section 172 of the CTA should not be interpreted as suggested by VIA.

[29]            Subsection 172(1) gives the Agency the ability to inquire, upon application, into a matter in relation to which a regulation could be made pursuant to subsection 170(1). Subsection 170(1) allows the Agency to make regulations in order to eliminate undue obstacles from the transportation network, including regulations respecting the design, construction or modification of the means of transportation.

[30]            Thus, the Agency, pursuant to subsection 172(1), can inquire into matters relating to design, construction or modification of the means of transportation, which is exactly what the Agency undertook to do in the present case. Therefore, I believe the Agency did not exceed its jurisdiction in undertaking the inquiry.

[31]            VIA further argued that allowing the Agency to act pursuant to section 172, where no incident had occurred, permitted it to interfere with the planning and operation of the railway. VIA submitted that its board of directors must be free to act without consulting the Agency in matters relating to the purchase and design of rail equipment. To allow this, VIA argued, would be to allow the Agency to "intrude into the boardroom of the company".

[32]            While I do not believe that the Agency exceeded its jurisdiction in this case for the reasons given, I do note, with concern, the danger suggested by counsel for VIA. The fact that the CCD, upon learning that VIA was considering the purchase of the Renaissance cars, and prior to even having had the opportunity to inspect the cars themselves, sought an order directing VIA not to enter into any agreement or to take any steps to purchase the Renaissance cars, does suggest an interference with VIA's decision-making. While I am unable to find that the Agency lacked the jurisdiction to consider the CCD's application here, it does seem to me that the nature of the CCD's application resulted in the Agency focussing virtually exclusively on the potential obstacles to the mobility in the cars the CCD believed still had to be purchased. This in turn resulted in the Agency failing to focus on the obstacles in the VIA network as a whole, as will be seen later. This has been indeed unfortunate because it led to the Agency's failure to focus on ways in which the Renaissance cars could be incorporated into VIA's network so the undueness of the obstacles could be avoided.               

[33]            It may well be that the Agency should have declined to commence an investigation based on the information which it had received from the CCD - that is - that VIA had not actually purchased the cars. Arguably the commencement of the investigation was premature. If the cars had not yet been purchased then they could not create an obstacle. Section 170(1) provides that the Agency may start an inquiry in order to determine whether "there is an undue obstacle to the mobility of persons with disabilities". There could hardly be said to be an obstacle if the cars had not yet been purchased. However, the fact was that VIA had already purchased the cars so the objection to prematurity would have been academic.

[34]            It is also worth noting that section 29 of the CTA envisions expeditious hearings with decisions being delivered within 120 days after commencement of the proceedings. The present hearing commenced with the CCD's application which was filed on December 4, 2000. The Preliminary decision was rendered on March 27, 2003, more than two years and 80 interim decisions and rulings later. This perhaps illustrates that the legislature did not intend that issues of the present magnitude be pursued under section 172. Nevertheless the statute must be interpreted according to its current provisions. Accordingly, the Agency's determination of its jurisdiction was correct.

[35]            As an additional jurisdictional argument, VIA maintained that in its identification of potential obstacles, the Agency treated the Rail Code (February, 1998 Code of Practice of Passenger Rail Accessibility and Terms and Conditions of Carriage by Rail of Persons with Disabilities), which provides voluntary goals and objectives of the industry, as mandatory, and enforced it against VIA. This was said to be beyond the Agency's jurisdiction. I do not accept that argument since in my view, the Rail Code was not treated as mandatory by the Agency. The Agency indicates at various places that the Rail Code is "voluntary and not legally binding" (Agency's Preliminary decision at page 20) and therefore does not rely exclusively on it when making its undue obstacle findings (Agency's Preliminary decision at page 22). The Agency does, however, find that the standards in the Rail Code serve as a "useful reference point" (Agency's Preliminary decision at page 22).

The undueness analysis:

[36]            It was incumbent on the Agency to balance the various interests referred to in section 5 when undertaking its undueness analysis, before requiring expenditure of money to reconstruct or reconfigure the Renaissance cars. The issue of "undueness" was discussed in VIA Rail Canada v. National Transportation Agency [2001] 2 F.C. 25 (C.A.) ["Lemonde"]. In Lemonde, the Court said

In determining whether the obstacle was undue, the Agency should have first considered the aim of the National Transportation Act, 1987. This is found in Section 3(1) (now Section 5), which provides that the nations transportation network should be, inter alia, economic, efficient, viable and effective.

Thus the undueness analysis can only be conducted by an examination of the transportation network as a whole.

[37]            Keeping this in mind, the Court in Lemonde set out the following principles to be considered in conducting the undueness analysis.

·                       undueness is a relative concept;

·                       the approach to defining undueness is a contextual one; it must be defined in light of the aim of the relevant legislation;

·                       an assessment of the consequences if the undue thing is allowed to remain in place can be useful;

·                       there is a requirement to balance the interests of the various parties, who, in proceedings of this nature, are usually persons with disabilities, VIA and the Canadian public;

·                       the transportation network must serve the needs of all travellers, including those with disabilities; and

·                       the needs of non-disabled passengers and those of disabled passengers may be inconsistent, which leads to the Agency having to undertake a balancing of interests such that the satisfaction of one interest does not create disproportionate hardship affecting the other interest.

[44]            A proper balancing of these factors when considering the entire transportation network will, of course, involve the issue of the costs of the changes to the Renaissance cars and the issue of the impact on other travellers. I will consider each of these issues separately.

Standard of Review

[45]            The standard of review analysis requires more deference here. The Agency's expertise is rooted in regulatory matters. Also, section 5 of the CTA is polycentric, meaning that it requires the Agency to balance competing principles. The finding of undue obstacles and the costs of remedying such obstacles are factual findings and the CTA contains a strong privative clause at section 31, calling for deference to the Agency when it comes to findings of fact (CTA, supra, at section 31). Also, the application of section 5 to the issues raised in this case involve questions of mixed fact and law. All these factors, in my opinion, suggest a high level of deference, bringing the standard of review on the question of undueness and the balancing of interests to be one of patent unreasonableness.

Undue Obstacles and Network Analysis

[46]            Section 5 of the CTA dictates that the Agency, when faced with a complaint by disabled persons in connection with the facilities offered by a transportation service provider, must go through the following analysis. First, it must determine if there is an obstacle to the mobility of disabled persons. Second, it must examine the whole network of the transportation service provider with a view to determining whether the network itself provides relief such that the obstacle cannot be said to be undue. Where the network does not provide such relief, the Agency must then consider the possible improvements to the network (including possible alternative transportation) which can eliminate or alleviate the undue obstacle. In considering the improvements to be ordered, the Agency must undertake a balancing exercise that takes into account the interests of disabled persons, non-disabled persons, the transportation service provider, as well as the economic well-being and growth of Canada.

[47]            Obviously the cost of any improvement ordered is crucial. Similarly, the transportation service provider may be totally unable to fund the improvements. If the costs are excessive, the fares may have to be increased to a point where the average person cannot afford to travel.

[48]            In the present case, VIA is subsidized by the federal government, which may be unwilling or unable to fund VIA to the extent of all the improvements ordered. The interests of all disabled persons must also be considered. There are many other disabilities such as blindness, deafness, cardiac conditions, asthmatic conditions, etc. All of these require different facilities. One must not be favoured to the detriment of another. Thus, such consideration cannot be limited to those in wheelchairs. It is also clear that not every railway car and not even every train can be fully equipped to cope with all forms of disability. The cost of so doing would be so great that the transportation service would be unlikely to survive. At the very least, its viability would be severely jeopardized.

[49]            In my view, the Agency in the present case made the following errors:

I.           In attempting to resolve the undue obstacles which it found for travel by persons in wheelchairs, it confined itself to considering only alterations to the Renaissance cars rather than considering whether VIA's network could be flexible enough to accommodate these disabilities;

II. It failed to conduct the necessary balancing exercise in that it:

                        a)          failed to consider the interests of non-disabled persons;

b)         failed to balance the costs of the improvements ordered against the interests of VIA. Here it failed because it did not wait to receive the cost estimates which it had ordered VIA to prepare;

c)          failed to balance the interests of persons with disabilities other than wheelchair users without taking into account the total amount of money which could realistically be available.

[50]            As previously mentioned, the CCD's December 4 application to the Agency only focussed on the Renaissance cars. VIA responded to the Agency that it was the adequacy of the network that was in issue and that the network as a whole posed no undue obstacles to the mobility of persons with disabilities.

[51]            However, the CCD continued to focus its undue obstacle analysis on the Renaissance cars as opposed to the network as a whole. There are several examples of this. In his December 14, 2000 response to VIA's December 12, 2000 letter that was sent to the Agency, David Baker, counsel for the CCD, replied,

Transport Canada officials and CTA officials who viewed the rolling stock [referring to the Renaissance cars], have not provided their opinion as to whether it meets even the voluntary Rail Code, let alone the "undue obstacle" standard in the Canada Transportation Act.

[52]            Unfortunately, the Agency responded by also focussing on the Renaissance cars instead of the network. In a letter dated December 18, 2000 from the Agency to VIA, the Agency stated,

VIA Rail is required to submit to the Agency and provide a copy to CCD by January 3, 2001 its existing plan to make this rolling stock accessible for persons with disabilities.

[53]            Similarly, in the Agency's January 24, 2001 letter to the CCD, the focus was again on the problems in the Renaissance cars as opposed to the whole network, since the Agency had only sought to determine the existence of undue obstacles in the Renaissance cars. Further in that letter, the Agency even considered issuing an interim order preventing VIA from entering into a contract to retrofit the cars, without any consideration of VIA's network. VIA responded that it was the network that should be considered.

[54]            Therefore, it seems that from the beginning, the primary focus of the proceeding was on the Renaissance cars and not the transportation network. This mind set was carried out through both the Preliminary and Final decisions, both of which I will now analyse.

Preliminary decision of the Agency - did the Agency look at the network?

[55]            In looking at the Preliminary decision, it seems that the Agency knew that the network had to be considered, as is evidenced by the fact that it set out the appropriate undue obstacle analysis prior to looking at the facts. Nonetheless, the Agency's primary focus was on the design and features of the Renaissance cars as they apply to the mobility of persons who use wheelchairs.

[56]            At the commencement of the analysis on page 31, the Agency states,

When making a determination pursuant to section 172 of the CTA, the Agency must first determine whether there is an obstacle and, if there is an obstacle, whether that obstacle is undue. The following summarizes what the Agency may consider when determining whether the design of the Renaissance Cars and its features constitute obstacles to the mobility of persons with disabilities (emphasis added) and whether any of the obstacles are undue.

...

The Agency typically makes an obstacle determination in the context of whether or not a situation constituted an obstacle to the mobility of a person with a disability in a particular case. However, as previously discussed, given that CCD's application alleges obstacles to the mobility of persons with disabilities in the context of the design of the Renaissance Cars, the Agency's analysis of the alleged obstacles is based on the design and features of these rail cars. Specifically, the Agency's analysis focusses primarily on the design and features of the Renaissance Cars as they apply to the mobility of persons who use wheelchairs, given that the primary focus of CCD's application is whether the cars are accessible to persons who use wheelchairs (emphasis added).

[57]            While later, the Agency referred to VIA's network, it did not conduct anything approaching a thorough analysis. A cursory analysis of one aspect of the network is engaged by the Agency at one point but seems to be confined to an examination of sleeper facilities for persons in wheelchairs on VIA's system. The Agency should have always, upon coming to a determination that the Renaissance cars lacked certain features, turned to the network to see if persons in wheelchairs could nonetheless have been accomodated.

[58]            Throughout the Preliminary decision, we see evidence of VIA's repeated expressions that the Agency needed to consider the network, rather than just the Renaissance cars. At page 32 of the Preliminary decision, VIA's argument about the consideration of section 5 of the CTA is noted,

The Agency must also consider and balance the interests of all passengers, the efficiency of rail transportation generally, the costs of operating VIA's passenger rail network and the economic viability of the railway company.

And again at pages 36-37, it is noted that VIA drew attention to its entire network. At page 37 of the Preliminary decision, VIA is said to have submitted, specifically,

VIA asserts that the Renaissance trains are only a part of "the fleet of the future" as they will be operating together with its existing fleet and will continue to operate together with new trains that will be built "hopefully as the moneys become available as we meet our needs to all Canadians".

[59]            Even when VIA submitted to the Agency that the Agency did not have enough evidence before it to look at the entire Canadian rail system (Agency's Preliminary decision at page 27.), and that persons in wheelchairs have a greater number of options in their travel planning, which the Agency would have to consider if undertaking a network analysis, the agency's response was,

As the Agency has repeatedly stated throughout these proceedings, it is considering whether certain features of the Renaissance Cars constitute undue obstacles arising out of the design of the Renaissance Cars (Agency's Preliminary decision at page 28).

[60]            Before the Agency, the CCD took the position that having to take a different train at a different time from that chosen by the wheelchair person constitutes an undue obstacle. The CCD argued that if such persons' needs could not be accommodated on a Renaissance train of their choice, then their freedom to travel was restricted, which amounted to discrimination (Agency's Preliminary decision at page 37).

[61]            In making this argument, the CCD overlooked the fact that in attempting to balance every interest, the system cannot afford to have every rail car equipped with every type of mechanism to be able to address every type of disability. Although this would be ideal, the funds required to design, implement and maintain such a system are clearly not available.

Show Cause Order

[62]               After the Agency made its preliminary findings regarding features in the Renaissance cars that constitute undue obstacles, it issued the Show Cause Order. This Order further shows that the Agency only looked at the Renaissance cars in order to determine the existence of undue obstacles. There, the Agency stated,

The Agency has made preliminary findings that the following features in the Renaissance Cars constitute undue obstacles to the mobility of persons with disabilities, including, and in particular, persons who use wheelchairs (Agency's Preliminary decision at page 143).

And again,

In recognition of both the fact that this application is unique in nature in that it involves the consideration of the design of rail cars and the volume of submissions filed relating to the forty-six concerns raised by CCD, the Agency is providing VIA with the opportunity, by way of a direction to show cause, to specifically address the preliminary undue obstacles that have been determined by the Agency to exist in the Renaissance Cars (Agency's Preliminary decision at page 144).

[63]            Further, the Show Cause Order directed VIA to answer 9 questions, none of which addressed VIA's network. Instead, each question was directed at the issues taken with the Renaissance cars. The questions were as follows:

(a) VIA is required to identify the various methods of remedying each of the above listed obstacles in the Renaissance Cars. If VIA is of the opinion that it is not possible, because of structural reasons, to remedy an obstacle, VIA is required to clearly explain the reasons why it is of such an opinion and to provide supporting evidence from a Professional Engineer who has expertise in the design and manufacture of rail cars.

(b) Where CCD has specifically identified a method(s) of remedying an obstacle, such as is the case for the wheelchair tie-down, VIA is required to give consideration to such method(s) and to indicate, in its response, whether it is of the opinion that such method(s) is structurally possible. If VIA is of the opinion that, because of structural reasons, such method(s) of remedying an obstacle is not possible, VIA is required to clearly explain the reasons why it is of such an opinion and to provide supporting evidence from a Professional Engineer who has expertise in the design and manufacture of rail cars.

(c) VIA is further required to describe, in detail, in respect of each of the methods of remedying an obstacle that it identifies as being structurally possible (including those suggested by CCD), the various structural modifications that would be required, according to the stage of completion of the Renaissance Cars (i.e., shells, partially completed cars, and completed cars). VIA is required to provide a level of detail commensurate with what would be required in order to enable a Professional Engineer with expertise in the design and manufacture of rail cars to fully understand the various structural modifications and any other structural implications entailed in respect of the particular method of remedying the obstacle.

(d) VIA is required to obtain from a third party an estimate of the cost of the various structural modifications that would be required in respect of each of the methods of remedying an obstacle identified by VIA as being possible, on a per car basis. The cost estimate must give consideration to the cost in respect of the cars that are completed, partially completed and uncompleted and must provide a level of detail sufficient to permit a full understanding of the cost estimate.

(e) In the event that any of the methods of remedying an obstacle, which VIA has identified as being possible, would have structural implications for other areas in the Renaissance Cars, VIA is required to specify what these are in a level of detail commensurate with what would be required in order to enable a Professional Engineer with expertise in the design and manufacture of rail cars to fully understand the associated structural implications resulting from the method of remedying the obstacle.

(f) In the event that any of the methods of remedying an obstacle, which VIA has identified as being possible, would have operational implications, VIA is required to specify in detail what these are so as to permit a full understanding of the operational implications resulting from the method of remedying the obstacle.

(g) VIA is required, in respect of items (iv) and (vi) above, to clearly identify and quantify any one-time costs and ongoing operating expenses that VIA would incur as a result of making the modifications to remedy an obstacle.

(h) If VIA is of the opinion that it cannot, from a financial perspective, afford the costs associated with remedying an obstacle, VIA is required to provide verifiable evidence to support its views. In this context, the Agency considers verifiable evidence to include financial information that is supported by VIA's financial records. The Agency is of the opinion that, of particular relevance are VIA's current audited and interim financial statements, its current cash flow projections and the underlying assumptions, and VIA's detailed business plan.

(i) VIA is required, as part of its response to the Agency's direction to show cause, to submit a plan for the Agency's consideration that sets out how VIA can address the obstacles that exist in the Renaissance Cars over a reasonable period of time. While the Agency recognizes that there may be significant operational and economic implications resulting from the requirement for VIA to undertake modifications to the Renaissance Cars in order to remedy the obstacles, the Agency is of the opinion that such implications may be mitigated by planning the modifications to occur over time so as to minimize the impact on the operation of VIA's passenger rail network. For example, VIA could start addressing the obstacles by focussing on those Renaissance Cars which are shells and those which are partially completed. In this way, existing Renaissance Cars which contain the obstacles can be taken out of service over time and be replaced with new cars as they are fitted up or modified to address the obstacles.

VIA has sixty (60) days from the date of this Decision to file its answer to these questions, along with a copy to CCD, who will have thirty (30) days to file its reply, with a copy of VIA. Should VIA wish to respond at that point, it will have then fifteen (15) days to do so. In the absence of any or all of the above required information, the Agency will finalize its findings and determination based on the evidence on file.

[64]            The Agency chose its own procedure. Its choice was to issue a Preliminary decision and a final decision. In the Preliminary decision it imposed detailed and onerous obligations upon VIA for the purpose of remedying the obstacles which the Agency perceived for the people in wheelchairs who made use of Renaissance cars. Indeed, it is obvious from the Show Cause Order that the sole remedy considered by the Agency was to have VIA structurally modify the Renaissance cars. This was a serious error. The Agency should rather, having identified the obstacles, have allowed VIA to remedy the obstacles by means of its network. One remedy might be to modify the Renaissance cars but VIA should not have been confined to this remedy. If the Agency was going to adopt a procedure of compelling VIA to suggest remedies for the obstacles it should have directed VIA to respond with suggestions as to how its network could respond to the obstacles. Although the Agency also invited VIA to file any further information which it considered relevant, this hardly represented an invitation to address VIA's whole network. Indeed given the tremendous emphasis which the Agency had placed on modification of the Renaissance cars, VIA might reasonably have thought it was not being invited to submit further information about available network solutions.

[65]          Also in the Preliminary decision, the Agency opined about the probability of the Renaissance cars replacing the existing fleet in the future as the existing fleet retired from service, even though VIA argued to the contrary. If this was a concern, the Agency should have so expressed in the Show Cause Order and directed VIA to address it. In the absence of this being addressed in the Show Cause Order, it was dangerous for the Agency to speculate about the abilities of VIA's future trains to meet the needs of disabled persons.

Subsequent to Preliminary decision but before Final decision

[66]            VIA submitted a letter with its internal cost estimates approximately 60 days after the Agency issued its Preliminary decision. The Agency found VIA's response inadequate and gave VIA an additional 60 days to provide further response. In VIA's further response, it provided documents to substantiate the internal cost estimates it had submitted earlier and it objected to the process, indicating that the time allotted was insufficient in which to render a response. In VIA's response to the Agency, it stated as follows:

VIA Rail takes the position with the greatest of respect to the Agency that the following factors limit the ability of VIA Rail to answer the questions in the way in which they are put by the Agency.

...

The reason for VIA Rail's objection to the present process, although it continues to attempt to fulfil the Agency's directions, is that it cannot be accomplished in the way the Agency has directed. For example, to make even the most minor change in railway rolling stock and provide costs requires structural, electrical and mechanical engineers. It also requires costing experts. In a simple process of redesign, the following engineering steps must be taken:

(a) a detailed analysis of drawings;

(b) stripping of various areas in the cars to validate actual design and identify space available and hidden components;

(c) identify major risk items;

(d) elaborate first potential solutions;

(e) contact suppliers/vendors on long lead items and explore potential solutions with them;

(f) define concept layouts;

(g) review concepts with VIA Rail;

(h) write technical description for heavily modified and new systems;

(i) support negotiation phases with vendors;

(i) [sic] do soft mock-up on problematic areas;

(j) contract award to vendors;

(k) reiteration of concepts and review with VIA Rail;

(l) produce detail drawings for components;

(m) issue requests to purchase raw materials and standard components;

(n) design review with vendors;

(o) build a mock-up to validate final design;

(p) support First Article Inspection of systems;

(q) do final detail drawings for manufacturing and installation; and

(r) issue nomenclature.

These steps will take much longer than the 60 day period allotted by the Agency to complete one design change. Multiple changes and alternatives as requested by the Agency make the task unmanageable and beyond the human resources of VIA Rail to complete in the time allotted.

...

In any event, none of the various design alternatives sought by the Agency can be completed until one final solution has been decided upon and the lengthy process described above is completed.

...

(h) finally, VIA Rail requests an oral hearing to explain these positions so that the Agency can be fully satisfied that it has all of the information presently available to VIA Rail.

[67]            The Agency did not grant an oral hearing and proceeded to give its Final decision on October 29, 2003, in which, for the first time, it specified the actual changes to be made to the Renaissance cars.

Final decision

[68]            In the Final decision, although the Agency used the correct language at the commencement of its analysis by stating that a balance had to be struck between the rights of persons with disabilities and the transportation service provider in accordance with section 5 of the CTA (Agency's Final decision at page 19), it failed to conduct such an analysis. While the Agency did, in a cursory manner, examine VIA's financial status, this does not amount to a balancing of interests within the meaning of section 5 of the CTA.

Both decisions

[69]            In my view, the Agency, having been asked by the CCD at the beginning of this proceeding, to halt the purchase of the Renaissance cars, failed to then look beyond the Renaissance cars to properly consider the whole network. The Agency's conclusion in the Preliminary decision and its Show Cause Order demonstrate that its primary focus was confined to the Renaissance cars and not on the network as a whole, which resulted in a failure to consider alternative actions that VIA could take to avoid or ameliorate the problem, such as providing alternative transportation or providing different trains at different times. The Agency's failure to properly consider VIA's network as a whole was patently unreasonable.

[70]            Instead of focussing on the Renaissance cars, there were certain points the Agency should have addressed in the Show Cause Order, which would have provided VIA with an opportunity to suggest other means of accommodating the problems. For example, the Agency should have requested more information as to the features in the Renaissance cars that were advantageous to persons with disabilities. If the Agency had asked, undoubtedly they would have been told that the Renaissance cars provided:

a. the availability of a wheelchair tie-down;

b. the use of a bedroom for a non-sighted passenger accompanied by a guide dog;

c. the use of a VIA-supplied purpose-built wheelchair, to allow wheelchair passengers to move throughout the train;

d. automatic doors between cars to assist in movement by persons with disabilities;

e. brail marking for sight impaired;

f. visual train information;

g. emergency warnings for hearing impaired; and

h. moveable arm rests for mobility impaired. (See affidavit of John Marginson, sworn December 5, 2003. While the Marginson affidavit was not before the Agency during the proceedings, by Order of Malone J.A. dated July 13, 2004, VIA was allowed to adduce fresh evidence before this Court. This Order was never appealed).

[71]            While the Agency focussed its analysis on obstacles in the Renaissance cars rather than the entire network, the dissenting member of the panel correctly focussed on whether VIA's network was able to cope with any undue obstacles found in the Renaissance cars. I believe he took the proper approach. At pages 148-9 of the Preliminary decision, Mr. Cashin stated,

Upon making a finding that there are obstacles, it is then necessary again, pursuant to subsection 172(1) of the CTA, to consider whether those obstacles are undue. This analysis involves a balancing of the undueness factors set out by the parties. As set out by the Federal Court of Appeal in the Lemonde Decision, the Agency must take into account the context in which an allegation that an obstacle is undue is made. In this regard, I agree with VIA's argument that its network is the proper context for the Agency's undueness analysis. My assessment of the evidence and argument presented by the parties leads me to the preliminary conclusion that the obstacles found in respect of the Renaissance cars do not constitute undue obstacles to the mobility of persons with disabilities.

...

After reviewing VIA's submissions regarding its network, I can only conclude that there is no evidence that VIA's existing network, with the addition of the Renaissance cars, will not continue to provide appropriate services to persons with disabilities. In fact, VIA submitted that its current policies and practices that assist persons with disabilities will continue to apply, with the introduction of the new cars.

...

VIA advised that the Renaissance trains are a "special one-time purchase" and are not the trains of the future. VIA acknowledges that the Renaissance cars will not "meet all of the needs of those with disabilities" and that any obstacles alleged by CCD concerning the Renaissance trains are overcome by the "adequate provision of other transportation services provided on VIA Rail's network". In my view, this implies that VIA will address any obstacles related to the Renaissance cars by taking the appropriate measures to ensure that VIA's network continues to address the needs of persons with disabilities.

...

Although I recognize CCD's arguments concerning the impact of the obstacles identified by the Agency on persons with disabilities, I am of the view that there is no evidence that these obstacles will not be accommodated by VIA's network. The rights of persons with disabilities to have equivalent access to the federal transportation network does not mean identical access or the provision of the identical services that are available to other passengers but rather it implies the notion of accommodation and VIA, in my view, has demonstrated that even with the addition of the Renaissance cars, the interests of persons with disabilities will continue to be accommodated by VIA's network.

[72]            The dissenting member retired before the Final decision was rendered and did not participate in it.

Balancing of Interests

Cost of remedying the obstacles

[73]            In the Show Cause Order, the Agency made preliminary findings as to the obstacles in the Renaissance cars it considered to be undue. At page 143 of the Preliminary decision, the Agency made the following findings:

The Agency has made preliminary findings that the following features in the Renaissance Cars constitute undue obstacles to the mobility of persons with disabilities, including, and in particular, persons who use wheelchairs:

1. Coach car

(a) the lack of movable aisle armrests on the double seat side of the coach cars

2. Economy coach car

(a) the width of the aisle between the two washrooms

(b) the inadequate clear floor space of the wheelchair tie-down to accommodate a Personal Wheelchair and a service animal

(c) the amount of manoeuvring space, including the lack of a 150 cm (59.06") turning diameter in the wheelchair tie-down area

(d) the width of the bulkhead door

(e) the lack of seating either beside or facing the wheelchair tie-down for an attendant

(f) the insufficient space that will accommodate persons travelling with service animals

3. Consists

(a) the Montréal-Toronto overnight train consist and the fact that there is no accessible washroom for persons using the wheelchair tie-down in the economy coach cars

4. Stairs

(a) the riser heights and stair depths

(b) the lack of closed stair risers

5. "Accessible suite"

(a) the width of the doors in the "accessible suite"

(b) the fact that a person with a disability will not be able to retain a Personal Wheelchair in the "accessible suite"

(c) the insufficient space beside the toilet in the "accessible suite" to allow a person using a Personal Wheelchair to effect a side transfer to the toilet

(d) the lack of a 150 cm (59.06") turning diameter in the "accessible suite"

[74]            As noted above, VIA was unable to provide cost estimates prepared by a third party within the time allotted by the Agency, including the 60 day extension. As a result of this, the Agency rendered its Final decision without such cost estimates. What the Agency did have and did consider was a cost estimate by a company called Pro-Sphere, which, according to the Agency, had been in the files of VIA, and were produced by VIA along with its letter indicating that it needed more time to comply with the Agency's order for production of more information. The problem with the Pro-Sphere report is that it provided estimates only on toilet configuration, which was only one of the fourteen features found by the Agency to constitute undue obstacles. It is also not clear as to what expertise Pro-Sphere possessed or for what purpose the estimates were prepared. Therefore, the Agency, in ordering its final corrective measures in the Final decision, did not have comprehensive third-party estimates as to the total cost of the changes as it requested from VIA in the Show Cause Order.

[75]            Subsequent to the issuance of the Final decision, VIA obtained much more detailed information about the costs from a train expert at Bombardier, Peter Schrum. He filed a 10 page affidavit attaching his 33 page report (Affidavit of Peter Schrum, sworn December 5, 2003 at paragraph 3. This affidavit was also newly adduced into evidence before this Court by Order of Malone J.A., supra.) The Schrum affidavit analyses the steps required to complete the work. It describes the steps of the production process and the major areas of change directed by the Agency. It contains diagrams, hours estimated, plans, timing and risks. The report addressed each of the ten corrective measures ordered by the Agency in its Final decision and is the only objective third party report which comprehensively estimates the costs of all the changes ordered by the Agency.

[76]               In his affidavit, Mr. Schrum said,

The re-construction of the cars, as directed by the Agency, make no engineering or production sense. Some of the directions of the Agency are laden with a number of complex and unknown structural, engineering, production and timing risks. I have done my best to complete the analysis needed for the engineering feasibility study and the preparation of the work up to the issuance of tenders and the completion of the work itself. My conclusions are qualified by a series of identified risks and a concern that there are unknown risks which will appear as the actual construction is carried out. Finally, there are a number of functions or costs which are not included in the calculations. To the extent possible I have applied an appropriate order of magnitude in order to estimate those costs.

[77]               He then estimated the total costs of changes ordered by the Agency to be in the order of $48 million. However, he then said,

The $48 million figure does not take into account structural changes which are unknown and a highly complex risk factor. In this regard, the service cars may be feasible from an engineering and production perspective. It may be possible to complete all of the work with minor structural changes. For the coach cars, they will need major structural changes for much of the work. These major structural changes are so complex that they cannot be fully mapped out until work begins. For example, moving the seat to the floor level requires a new seat, a new attachment, re-engineering of the floor, a new mounting attachment and load-path changes in the floor itself. The new washroom in the coach car requires structural changes in the coach car itself, both the floor, the flooring structure and other possible parts. It is also necessary to re-route or re-work the plumbing, the holding tanks, the electrical system, the air conditioning system, the battery underneath the train and other major structural changes. None of these changes are included in the $48 million cost and may not be possible from an engineering perspective. The costs could go as high as $92 million if structural problems arise.

In addition, the total cost excludes all detailed engineering of components.

[78]            It should be pointed out that the CCD, upon receiving the Schrum report, filed a report of their own by a Mr. Ron Woollam, which, while critical of the Schrum report, does not in itself make clear estimates of the total costs involved in making the changes ordered by the Agency.

[79]            The Agency, in the Preliminary decision, before undertaking any such balancing, concluded that VIA had failed to provide "compelling evidence of economic impediments to addressing any undue obstacles found to exist in the Renaissance Cars" (Agency's Preliminary decision at page 46). The Agency came to this conclusion before it had even defined the changes to be made to the Renaissance cars.    At this point, it would not have been possible for anyone to know the costs involved.

[80]            Similarly, the Agency found that there was no evidence of economic impediments preventing VIA from addressing the obstacles in the Renaissance cars (Agency's Preliminary decision at page 46) at the beginning of the analysis in the Preliminary decision, before it required VIA to obtain the estimated cost for the various structural modifications in the Show Cause Order. Having reached the conclusion that there was no compelling evidence of economic impediments in funding the changes before asking VIA to obtain estimates of these costs is patently unreasonable. One cannot conclude that VIA can afford to pay for the changes without knowing the cost of these changes.

[81]            The Agency therefore determined that there were no economic impediments before it addressed the changes to be made to the Renaissance cars and before it asked for cost estimates.

[82]            In my view, it is of utmost importance not just to persons in wheelchairs, but to all other disabled persons, VIA, the Government of Canada and the Canadian public, that before costs of the magnitude envisioned by the Schrum report are incurred, that the Agency reconsider its decision, taking into account the total costs of the changes ordered as well as the other factors to be balanced, as set out in the Lemonde decision.

[83]            As it has been said, it is absolutely necessary to balance the various interests under section 5 of the CTA. This can only be done once the true cost of the changes is known. VIA had indicated to the Agency that it could not respond to the Show Cause Order adequately in the time allotted. It is clear to me that VIA had a valid point. The amount of detail required by the Agency in its Show Cause Order was very great and more time should have been provided for VIA to respond. The Agency's failure to provide such opportunity to VIA, in my view, constitutes a denial of procedural fairness justifying that its decision be set aside with a direction to reconsider the matter.

Impact on other travellers

[84]               In an undueness analysis, the interests of the various parties must be balanced. However, at page 40 of the Preliminary decision, the Agency said,

With respect to VIA's opinion that the Agency must consider its network against the actual number of passengers with disabilities who travel on it, the Agency is of the opinion that such a factor is not determinative. As discussed, the Agency is of the opinion that Part V of the CTA is, by its nature, human rights legislation, which is specifically aimed at protecting the rights of a minority group; namely, persons with disabilities.

[85]            In the above quotation, it is unclear as to whether the Agency dismissed as a consideration the fact that, of the passengers travelling by rail, only 0.5% of them were disabled in 1995 according to the Agency (Agency's Preliminary decision at page 40) and 0.0611% in 2003, according to VIA. In either event, the figure representing disabled passengers travelling by rail is small. While I am in agreement that the fact that passengers with disabilities constitute a small percentage of all passengers cannot be taken to justify totally inadequate facilities for disabled people, the numbers must nonetheless be taken into consideration.

[86]            It must be noted that although the carrier is obliged to take into account the needs of disabled persons, the needs of non-disabled persons must also be taken into account because the system must function and be available for all users. Part of the balancing analysis requires a consideration of the monies necessary to keep the system running. If expenses are so high that VIA has to increase its fares and average citizens cannot afford to travel, then the objectives in section 5 of the CTA cannot be met.

[87]            In my view, without having the necessary information as to costs before it while rendering its Final decision and by failing to consider the cost and the impact on other travellers, the Agency's decision is patently unreasonable.

Agency expertise

[88]               In the Preliminary decision, the Agency concluded that there was no evidence to support VIA's opinion that its network could address obstacles that were found to exist in the Renaissance cars. Specifically, at page 38 of the Preliminary decision, the Agency found,

Furthermore, the Agency finds that there is no evidence on the record that supports VIA's opinion that its existing fleet or its network, generally, will address obstacles that may be found to exist in the Renaissance Cars.

[89]            However, there was some evidence in relation to VIA's belief that it could accommodate persons in wheelchairs. For example, there was evidence before the Agency as to VIA's network features. VIA's network has various policies in place specifically designed for the accommodation and comfort of persons with disabilities, including policies regarding wheelchair handling, where VIA service agents are trained in providing assistance and equipment for persons with disabilities.

[90]               The Agency also said that VIA had not submitted any evidence about its alternative transportation policy. This fails to note that the Agency is a tribunal with expertise in areas of railway transportation policy. This expertise is the reason deference is shown to the Agency by the Courts. In Decision No. 479-AT-R-2002, dated more than one year prior to the Final decision, the Agency reviewed VIA's transportation network when it was considering a complaint about an undue obstacle and noted the following about its own mandate:

It is worth noting that the tribunal's consideration of the matter of accessible transportation predates the 1988 amendments in that the first accessible transportation matter was considered in 1980 when the RTC entertained the application filed by Clariss Kelly, a person with a disability who uses a wheelchair, against VIA under section 281 of the then Railway Act which required railway tariff provisions to not be prejudicial to the public interest.

[91]               The Agency noted the same fact at page 28 of the Preliminary decision:

Concerning expertise, the Agency has the necessary expertise to deal with this complaint. The first accessible transportation matter was considered in 1980, prior to the enactment of specific accessible transportation provisions in the legislation...

Specifically, the Agency has addressed complaints where, among others, issues pertaining to aisle widths and accessible washrooms have been examined. In terms of the balancing process, the Agency has examined economic considerations, carrier policies and transportation alternatives offered by the transportation provider (emphasis added).

[92]            While my views on this point are not necessary for my decision, I would say, by way of obiter dicta, that given the Agency's mandate, its expertise and the fact that VIA has come before it on numerous occasions, the Agency should have made use of its expertise relating to rail transportation matters when considering VIA's network. Accordingly, while there may not have been extensive evidence submitted by VIA (because the Agency's focus was on the Renaissance cars), the Agency is required to draw on its expertise for its decisions. That is the purpose of having an expert tribunal and of the Courts giving deference to its decisions.

VIA's right to an oral hearing

[93]            As previously mentioned, subsequent to receiving the Show Cause Order in the Preliminary decision, VIA requested an oral hearing to explain inter alia the difficulties in responding to the Show Cause Order. This oral hearing was denied.

[94]            VIA's position was that the Agency's decisions would have a significant impact upon VIA and therefore, VIA should have been afforded full procedural rights. Full procedural rights, in many instances, require an oral hearing, especially where the issues cannot be resolved on the basis of the documentary evidence alone. Here, VIA requested an oral hearing in order to fully present its arguments on the Show Cause Order and has now stated that the failure by the Agency to grant the oral hearing deprived the Agency of evidence that was necessary for the proper rendering of its Final decision. Therefore, VIA submits that when procedural rights have been denied, the proper remedy is for the court to quash the decision and remit the matter back to the administrative decision-maker.

[95]            In noting that the content of the duty of fairness is flexible and depends on the context of the statute at issue (Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817 at paragraph 22 [Baker]), it is my view that the Agency had the right to exercise its discretion in deciding whether to grant an oral hearing. It has discretion in the conduct of its own affairs (Baker, supra at paragraph 27) and neither the CTA nor the Agency's General Rules (National Transportation Agency General Rules, SOR/88-23, Rule 38) require it to hold an oral hearing. Specifically, General Rules 38 and 40 state,

38. The Agency may make any order, decision, ruling or direction or give any leave, sanction or approval otherwise than by holding an oral hearing.

40. Procedural decisions shall be made on the basis of material filed with the Agency and without an oral hearing unless a party demonstrates that the interests of justice require the holding of an oral hearing.

[96]            Therefore, the Agency's decision regarding the refusal to grant an oral hearing is one which it has the discretion to make. It cannot be said that this decision was patently unreasonable.

[97]            I do not wish, however, in saying this, to be taken as saying that VIA did not need further opportunity and more leeway to present the information and estimates to the Agency pursuant to its direction in the Show Cause Order. While it was within the discretion of the Agency to require that this be done by letter, it was incumbent on the Agency to allow sufficient time to permit this to be done.                         

Standing of the Agency before this Court

[98]            The Agency filed a factum in this appeal and appeared to make oral argument. In its factum, the Agency addressed not only the questions of its jurisdiction and standard of review, which it was entitled to do, but also other issues relating to the facts and merits of VIA's position. I quote some excerpts from the Agency's factum as examples:

It is respectfully submitted that, as evidenced by the March and October Decisions, the Agency conducted a careful balancing of the undueness factors, as raised by the parties... It is respectfully submitted that, based on the evidence that was provided by the parties, the Agency's analyses were appropriate and reasonable in the circumstances.

...

A. Paragraph 70(a): The Agency respectfully submits that it finds it surprising that VIA was unable to obtain expert evidence on the projected costs of conducting redesign and reconstruction work until after the Agency rendered its final decision when the Agency had clearly set out in the March Decision the preliminary undue obstacle findings that it had made.

E. Paragraph 70(e):... Many of the corrective measures that VIA has been directed to undertake will, in addition to benefiting passengers with disabilities who use wheelchairs, also benefit other passengers with and without disabilities. For example, an accessible washroom will benefit many passengers as will moveable aisle armrests and thus the number of passengers benefiting from the Agency's Decision is greater than the 0.061% that VIA sets out in this paragraph.

...

In conclusion, the Agency respectfully submits that it recognizes the requirements of natural justice and fairness in its decision-making process and that VIA was not denied the opportunity to properly present its case before the Agency.

[99]            From these excerpts, it appears that the Agency has entered into the fray and become an adversary in this matter. This is to be regretted. The statements of Estey J. in [1979] 1 S.C.R. 684">Northern Utilities v. City of Edmonton, [1979] 1 S.C.R. 684 at 708 to 710 are apposite.

This appeal involves an adjudication of the Board's decision on two grounds both of which involve the legality of administrative action. One of the two appellants is the Board itself, which through counsel presented detailed and elaborate arguments in support of its decision in favour of the Company. Such active and even aggressive participation can have no other effect than to discredit the impartiality of an administrative tribunal either in the case where the matter is referred back to it, or in future proceedings involving similar interests and issues or the same parties. The Board is given a clear opportunity to make its point in its reasons for its decision, and it abuses one's notion of propriety to countenance its participation as a full-fledged litigant in this Court, in complete adversarial confrontation with one of the principals in the contest before the Board itself in the first instance.

It has been the policy in this Court to limit the role of an administrative tribunal whose decision is at issue before the Court, even where the right to appear is given by statute, to an explanatory role with reference to the record before the Board and to the making of representations relating to jurisdiction....

In the sense the term has been employed by me here, "jurisdiction" does not include the transgression of the authority of a tribunal by its failure to adhere to the rules of natural justice. In such an issue, when it is joined by a party to proceedings before that tribunal in a review process, it is the tribunal which finds itself under examination. To allow an administrative board the opportunity to justify its action and indeed to vindicate itself would produce a spectacle not ordinarily contemplated in our judicial traditions.

[100]        The Agency cannot be an adversary in a matter on appeal wherein the decisions being appealed were rendered by the Agency itself. The Agency should take note of this for future proceedings.

Conclusions

[101]        For the reasons given, the appeal will be allowed with costs against the respondents, and this matter will be referred back to the Agency for reconsideration in accordance with these reasons.          

                                                                      "J. EDGAR SEXTON"

                                                                                                      J.A.                      

"I agree

   Robert Décary j.a."

EVANS J.A. (concurring reasons)

A.        INTRODUCTION

[102]        I have had the great benefit of reading the careful reasons of my colleague Sexton J.A. and agree that neither the preliminary order nor the final order of the Agency can stand. However, I would dispose of the appeal on somewhat different bases.

[103]        In my respectful view, the only error by the Agency warranting the intervention of this Court is its failure to afford a reasonable opportunity to VIA to address issues crucial to the ultimate determination of the CCD's application. First, the Agency's preliminary order should have specifically invited VIA to submit evidence that would enable the Agency to determine if the obstacles to mobility presented by the Renaissance cars were undue when considered in the context of VIA's network. Second, when it issued its "final" order specifying the modifications to the Renaissance cars that it required, the Agency should have invited VIA to submit a third party estimate of the costs of the modifications and an assessment of their feasibility from an engineering perspective.

[104]        I am not persuaded, however, that, having considered VIA's submissions regarding its network, the Agency committed reversible error when it concluded in the preliminary decision that the obstacles to the mobility of persons in wheelchairs presented by the Renaissance cars were "undue". Nonetheless, a consideration of the network is so fundamental to any determination of whether an obstacle is undue, and the evidence on the issue before the Agency was so limited, and lacking in specificity, that the Agency ought to have invited VIA to demonstrate how it proposed to mitigate the obstacles in the Renaissance cars, thereby obviating the need to make the prescribed modifications to them.

[105]        In its preliminary decision, the Agency found that the design of the Renaissance cars constitutes an obstacle to the mobility of many persons whose disability requires them to use a personal wheelchair. I do not understand Sexton J.A. to require the Agency to revisit this issue. The evidence before the Agency was that these cars do not to meet mandatory accessibility standards in other countries, such as the United States and the United Kingdom. This may explain why VIA was able to purchase them at what it regarded as a bargain price.

[106]        The undueness of the obstacles is the issue in dispute. As I have already indicated, I am not persuaded that the Agency's conclusion that the obstacles were undue was patently unreasonable, in view of the Agency's analysis of the issue, and of the general and limited information that VIA submitted to the Agency concerning the capacity of the network to mitigate the effect of the obstacles to travel presented by the Renaissance cars to passengers using personal wheelchairs. I am also doubtful whether VIA has established that the Agency's balancing of the factors listed in section 5 was patently unreasonable on the basis of the evidence before it on the cost of the modifications that it ordered.

[107]        The following three preliminary observations inform these conclusions. First, review for patent unreasonableness does not authorize the Court to intervene on the ground that it would have weighed the relevant factors and the evidence differently from the Agency. In its preliminary, or show cause, decision, the Agency clearly did consider the undueness of the obstacles in the context of the network as a whole. That the Agency's reasons sometimes make no reference to the network in the context of undueness is explicable, in part at least, by the fact that the Agency was not satisfied, on the basis of the evidence submitted by VIA, that the network prevented the obstacles inherent in the design of the Renaissance cars from being undue. Not every shortcoming in the Agency's analysis will constitute patent unreasonableness.

[108]        Second, I agree with my colleague's observation that, while it is not legally necessary for the Agency to wait until it has a specific complaint from a passenger who is unable to use the service ordinarily provided by a carrier between two points, the kind of generic complaint made in this case may prove difficult for the Agency to investigate, especially, as this case illustrates, when it comes to considering the undueness of obstacles in the context of the network and the potential cost of modifications. The critical issues will often only come into focus towards the end of a lengthy administrative process.

[109]        Third, in my view, the Agency's problems were compounded by an apparent lack of cooperation during the administrative process on the part of VIA. Any corporation in a regulated industry, including VIA Rail, is entitled to defend vigorously the interests of its shareholders and customers, as well as the public purse, from the imposition of regulatory burdens. Nonetheless, in viewing the limited material before the Agency on the network issue and the question of cost, I find it hard to avoid the conclusion that, if the Agency's analysis was based on incomplete information, VIA was, in part at least, the author of its own misfortune.

B.        ISSUES AND ANALYSIS

(i) standard of review

[110]        Sexton J.A. rightly points out that this Court may reverse the decisions on the basis of the Agency's determination of "undueness" only if they are patently unreasonable, unless the Agency has erred in the interpretation of the statutory provisions relevant to the disposition of the CCD's complaint, or breached the duty of procedural fairness.

[111]        The selection of the most deferential standard to review findings of undueness is appropriate because of the multiplicity of factors and interests to be weighed, and the technical aspects of some of the issues. Decisions on these matters involve the exercise of discretion, based on the evidence and the statutory criteria, and are within the specialized mandate of the Agency.

(ii) the network issue

a) duty of fairness

[112]        As Sexton J.A. rightly emphasises, it is settled law in this Court that whether an obstacle to the mobility of passengers with a disability is undue must be assessed in the context of the carrier's network. In other words, the Agency must inquire to what extent the carrier can accommodate passengers wishing to travel between two points on the network who are unable to access the mode of transport offered to passengers at large: VIA Rail Canada Inc. v. Lemonde, [2001] 2 F.C. 25 (FCA).

[113]        In view of the fundamental importance of considering the undueness of the obstacles in the cars in the context of possible network solutions, the unsatisfactory nature of the evidence submitted by VIA, and the generic nature of the inquiry, the Agency was not entitled to regard the network issue as concluded when it issued its preliminary order.

[114]        Accordingly, as a matter of fairness, and sound public administration, VIA was entitled to an opportunity to show whether, or how, it could address through its network the specific issues that had emerged during the process culminating in the preliminary decision. A brief invitation to VIA to submit any other information it thought relevant was included at the end of the Agency's preliminary order, which dealt in detail with problems in the structure and design of the cars, and VIA's obligations with respect thereto. This was insufficient to make it clear to VIA that it could make further submissions to the Agency on the network issue.

[115]        The Agency should have ensured that VIA had an opportunity to provide information on

two network issues: first, the network solutions that VIA proposed for passengers in personal wheelchairs who wished to travel on routes where VIA operated consists of Renaissance cars;

second, as more Renaissance cars were brought into service, the likely effects on existing travel options of the redeployment and retirement of the older, more accessible cars.

[116]        For example, VIA might have responded by advising the Agency whether it would (or could) ensure that, say, once or twice a week, it would put a consist of older cars on routes on which it normally ran Renaissance cars. Alternatively, in view of VIA's estimate of the small number of passengers unable to access the Renaissance cars, it might have proposed paying the cost, over and above the price of a rail ticket, of another mode of transportation.

b) the Agency's network analysis

[117]        The CCD's principal concern on the network issues identified in paragraph 109 was that, given their projected life span of 25-30 years, the 139 Renaissance cars purchased by VIA were likely, over time, to replace older, but more wheelchair-accessible cars on routes in the corridor between Quebec and Windsor. VIA had announced that, in 2003, it would replace its existing cars on the routes between Montreal and Halifax, and between Montreal and Gaspé, and use Renaissance cars to provide a day and overnight service. In addition, Renaissance cars are currently being used on the Toronto-Ottawa overnight service, as well as on the Montreal-Ottawa and Montreal-Quebec routes.

[118]        VIA had provided no information explaining how it would deal with these issues. Since the evidence before the Agency was that Renaissance cars could not be combined with other cars in the same consist, the obstacles presented by the Renaissance cars could not be mitigated by including in a consist one of the older, more accessible cars.

[119]        Instead, the information provided to the Agency by VIA simply listed the range of options that it made generally available to accommodate passengers with disabilities. Thus, in its final written submission, dated February 18, 2002, VIA stated (Appeal Book, vol. 6, p. 2193):

The network design includes the reservation systems, the alternative transportation policy, ground services, special handling services, train accommodation, employee training and special service requests. The train accommodation includes all of VIA Rail's rolling stock. ... The evidence in this regard indicates that VIA meets its obligations to passengers with in Canada, even without the Renaissance cars. With these cars there are more options for passengers with disabilities. [emphasis added]

It said also that Renaissance cars would form only a part of the "fleet of the future" and would operate with existing cars and with cars to be built in the future.

[120]        The Agency's analysis of the network issue occupies four pages (Appeal Book, vol. 1, pp. 53-57), or less than three per cent, of the reasons given for the preliminary decision. However, whether the reasons on the issue are sufficient to pass judicial scrutiny cannot be determined merely by their length, without also considering the nature and quantity of the information provided to the Agency.

[121]        In its analysis, the Agency set out the information contained in the sentence underlined in the above quote from VIA's written submissions, and noted VIA's assurance that all these arrangements would remain in place after the introduction of the Renaissance cars. The Agency also referred to the existence of VIA's communication system that enabled passengers to call in advance to discover their travel options, and to its contention that passengers with disabilities may not be able to travel on every train.

[122]        The Agency concluded that the evidence did not establish to its satisfaction that the existing fleet or the network would address the obstacles that it had found to exist in the Renaissance cars. First, it was of the view that, over time, cars in the existing fleet would be deployed from the Quebec-Windsor corridor to routes in western Canada, or retired. This would reduce the options available for those unable to use the Renaissance cars. Moreover, the Agency also found (Appeal Book, vol. 1, p. 56) that, in view of the number purchased, and their life expectancy,

Renaissance cars will be the only cars in operation on some of VIA's routes in the near future and they will be a significant part of VIA's network for a considerable period of time.

In so finding, the Agency did not accept VIA's assertion that the introduction of the Renaissance cars would have no effect on existing travel options because they were intended to augment the size of the fleet.

[123]        Second, the Agency noted that neither the cars in the existing fleet, nor the Renaissance cars, have sleeper units accessible to personal wheelchair users, despite a previous commitment by VIA to improve the accessibility of its sleeping cars in order to comply with Rail Code standards.

[124]        Third, as for the number of passengers with disabilities for whom some kind of accommodation is needed, the Agency concluded that VIA's figure was an underestimate. This was because VIA had not taken account of either the numbers unable to travel as a result of the inaccessible features of its cars, or the fact that the demand for accessible travel is likely to increase as the population ages and travel becomes more accessible.

[125]        Patent unreasonableness is a standard of review that does not permit the Court to re-evaluate the material before the Agency, or even to subject the Agency's reasons to the somewhat probing examination that must be undertaken when reasonableness simpliciter is the applicable standard.

[126]        In view of the evidence before it, and the quality of the analysis, the Agency's decision was not patently unreasonable. In my respectful opinion, it was rationally open to the Agency to conclude that, in the absence of more precise information from VIA as to how it would accommodate passengers through its existing fleet or its network on the routes where Renaissance cars would by deployed, the obstacles were undue.

[127]        Further, it was not patently unreasonable for the Agency to reject VIA's assertion that present network options would continue to be available, despite the redeployment of cars to the west, and the retirement of aging cars, as Renaissance cars were brought into service. In view of counsel's submissions on the state of VIA's finances, the claim that VIA would be purchasing additional cars at some unspecified date in the future is too speculative a basis on which to reverse the Agency's finding regarding the continuation of existing options.

c) a duty to take official notice?

[128]        VIA argues that the Agency should have supplemented the evidence on the record in this matter by resorting to its institutional knowledge of the range of options available through VIA's network. The argument is that, as an expert administrative tribunal, the Agency is required to take official notice of information that it had acquired about VIA's network in the course of conducting other proceedings. Presumably, this duty is subject, as a matter of procedural fairness, to the Agency's disclosing to the parties the information of which it has taken notice, and giving them an opportunity to comment on it.

[129]        I cannot accept this argument for two reasons. First, it could be very onerous to impose a general obligation on specialist administrative agencies to resort to their institutional expertise or knowledge in order to remedy deficiencies in the information which, in a particular proceeding, a party provided about its business. It is one thing for the law to permit an agency, subject to considerations of procedural fairness, to supplement an administrative record from its specialist knowledge. It is quite another to oblige it to search its institutional memory for information that a party could have provided readily. In the absence of legal authority on the point, I would not impose such a potentially far-reaching duty on the Agency, which should normally be able to decide a matter on the basis of the material put before it by the parties in the very proceeding that is the subject of judicial review.

[130]        Second, the information previously provided to the Agency about the policies and practices that VIA had developed to accommodate passengers with disabilities who require the use of a wheelchair does not seem to me to be materially different from that submitted to the Agency by VIA in this case. It is general in nature and does not address the specific accessibility issues raised for users of personal wheelchairs by the introduction of the Renaissance cars on routes in the corridor between Quebec and Windsor, and by the redeployment or phasing out of the more accessible cars in the existing fleet.

(iii) cost

[131]        In my opinion, the Agency acted in breach of the duty of procedural fairness when it failed to afford VIA an opportunity to respond to its "final" order specifying the modifications that it required VIA to make to the Renaissance cars. The opportunity given to VIA to respond to the preliminary decision was not adequate in view of VIA's submission that the information required from it would be too costly and time-consuming to produce: see, for example, the report to VIA from Bombardier (Appeal Book, vol. 3, p. 1192).

[132]        The onerous nature of the order in the Agency's preliminary decision is evident from paragraphs (a) through (i) of its order (Appeal Book, vol. 1, p. 145) which, among other things, require VIA to list and to cost the ways of removing the identified obstacles in the design and structure of the Renaissance cars. The Agency required VIA to retain an independent professional engineer with relevant expertise and to prepare a report on these matters. In addition, if it was not possible, in the view of the engineer, to make any of the prescribed modifications to the cars, the report to the Agency should explain the reasons why.

[133]        There was no evidence before the Agency contradicting VIA's submission that compliance with the Agency's preliminary decision would be unduly onerous. The CCD's observation that VIA did not request another extension of time to enable it to submit the information required by the Agency does not respond to VIA's complaint that compliance would be too expensive.

[134]        In other words, the Agency's invitation to the parties to respond to the preliminary decision did not provide VIA with a reasonable opportunity to make submissions on costs and feasibility. In these circumstances, the Agency ought to have permitted VIA to submit a report on costs and feasibility after the Agency had identified the modifications to the Renaissance cars that it required in order to remove the obstacles that they had been found to contain.

C.        CONCLUSIONS

[135]        For these reasons, I would allow the appeal, set aside the preliminary and final orders of the Agency, and remit the matter to the Agency. I would direct the Agency to invite submissions from the parties on whether the obstacles that have been found to exist in the Renaissance cars are undue, having regard to: (i) the alternatives available through VIA's network for travellers unable to access Renaissance cars; (ii) the likely costs, and technical feasibility, of the corrective actions that it ordered VIA to take; and (iii) the other factors that section 5 requires the Agency to balance in making its determination of undueness.

                                                                                   "John M. Evans"               

                                                                                                      J.A.                       

                          FEDERAL COURT OF APPEAL

    NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                  A-238-04

STYLE OF CAUSE: VIA RAIL CANADA INC.                   Appellant

and

CANADIAN TRANSPORTATION AGENCY and

COUNCIL OF CANADIANS WITH DISABILITIES

Respondents

PLACE OF HEARING:                                 TORONTO, ONTARIO

DATE OF HEARING:                                   NOVEMBER 22 & 23, 2004

REASONS FOR JUDGMENT :                  SEXTON J.A.

CONCURRED IN BY:                                  DÉCARY J.A.

CONCURRING REASONS BY:                  EVANS J.A.

DATED:                     MARCH 2, 2005

APPEARANCES:

John A. Campion

Annie M.K. Finn

Nicole D. Samson        For the Appellant

Inge Green

Elizabeth Barker           For the Respondent, Canadian Transportation Agency

David Baker

Sarah Godwin              For the Respondent, Council of Canadians with Disabilities

SOLICITORS OF RECORD:

Fasken Martineau Du'Moulin LLP.,

Barristers & Solicitors

Toronto, ON               For the Appellant

Legal Services Directorate

Canadian Transportation Agency

Gatineau, QC               For the Respondent, Canadian Transportation Agency

Baker Law

Barristers & Solicitors

Toronto, ON               For the Respondent, Council of Canadians with Disabilities