Docket: A-542-15
Citation: 2015 FCA 295
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CORAM:
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NOËL C.J.
BOIVIN J.A.
RENNIE J.A.
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BETWEEN:
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LAURENTIAN
PILOTAGE AUTHORITY
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Appellant
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and
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CORPORATION DES
PILOTES DU SAINT-LAURENT CENTRAL INC.
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Respondent
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REASONS FOR JUDGMENT
NOËL C.J.
[1]
This is an appeal from a decision of Justice
Locke of the Federal Court (the Federal Court judge), dated December 14, 2015,
(2015 CF 1382) dismissing the motion for an interlocutory injunction filed by
the Laurentian Pilotage Authority (the LPA). The motion was to compel the Corporation des pilotes du Saint-Laurent Central Inc. (the Corporation) to add to the Work Schedule of licensed pilots
in District No 1, the required complement of pilots for the period from
December 22, 2015, to January 4, 2016, according to the terms of a new service
contract ratified by both parties on October 15, 2015.
[2]
In light of the tight timelines, the deadlines
specified under the Federal Courts Rules, SOR/98-106, were abridged and
the appeal was expeditiously heard in a one-hour hearing at Ottawa. The brief
reasons that follow were issued the next day.
[3]
The Federal Court judge conducted his analysis
on the basis of the tri-partite test established by the Supreme Court in RJR-MacDonald
Inc. v. Canada (Attorney General), [1994] S.C.R. 311 [RJR-MacDonald].
He found that the LPA had succeeded in establishing the existence of a serious
issue and irreparable harm, but that the balance of convenience did not favour
issuing an interlocutory injunction. He therefore dismissed the LPA’s motion.
[4]
Before us, the LPA submits that the Federal
Court judge erred in law in concluding that the balance of convenience favoured
the Corporation. For its part, the Corporation is asking that we uphold the
Federal Court judge’s decision in this regard. It adds that the Federal Court
judge was wrong to conclude that the LPA had suffered irreparable harm, with
the result that the injunction sought be the LPA could not have been granted in
any event.
[5]
The decision to grant or dismiss a motion for an
interlocutory injunction is a discretionary one. A review of the lawfulness of
a discretionary decision ought to be conducted within the general appellate
framework set out in Housen v. Nikolaisen, 2002 SCC 33, depending on
whether it is a question of law, of fact, or a question of mixed fact and law (Jamieson
Laboratories Ltd. v. Reckitt Benckiser LLC, 2015 FCA 104, para. 21, citing Imperial
Manufacturing Group Inc. v. Decor Grates Incorporated, 2015 FCA 100, paras.
18 and 19).
1st branch: serious issue
[6]
The existence of a serious issue is not in
question in this appeal. In addressing this question, the Federal Court judge
explained that his decision was, for all intents and purposes, equivalent to a
final decision, given the time constraints he was under. Thus, he allowed
himself to make a more definitive finding than he otherwise would have, had an
arbitrator been afforded enough time to properly dispose of the matter (Reasons,
para. 19).
[7]
The Federal Court judge dismissed the
Corporation’s position according to which the customs and usage in the context
meant that the pilot’s Assignment Schedule initially established for 2015 (the 2015
Schedule) was unaffected by the signing of the new service contract during the
year (Reasons, para. 22). Despite the fact that it had been entered into on
October 15, 2015, the contract took effect on July 1, 2015 (Exhibit P-2 of the
LPA Record).
[8]
As for the moment the Assignment Schedule was to
be changed, the Federal Court judge pointed out that under the terms of the
contract, [Translation] “[n]othing indicates that these [the new assignment]
requirements will not apply immediately”, namely, upon the contract’s
coming into force (Reasons, para. 24). He then dismissed the Corporation’s
contention that it was not possible to change the Assignment Schedule during
the year, determining that the evidence submitted in this regard by the Corporation
was insufficient (Reasons, para. 25).
[9]
According to the Federal Court judge, the LPA
had succeeded in establishing that the Corporation had an obligation to comply
with the new assignment requirements immediately upon signature of the contract
(Reasons, para. 27). The issue raised by the LPA in support of the issuing of
the injunction was therefore not only a serious one but was likely to lead to a
decision favourable to the LPA on the balance of the evidence presented before
the judge.
2nd branch: irreparable harm
[10]
Under the irreparable harm branch, the Federal
Court judge also dismissed the Corporation’s position as follows (Reasons,
para. 32):
[Translation]
[32] The Corporation maintains that the
LPA’s argument that there will be delays during the holiday period this year is
hypothetical. I disagree. After seeing the statistics for 2008 to 2014, it
seems likely that there will be delays caused by the unavailability of pilots
during the holiday period this year. It is difficult to estimate the number of
delays, but I expect that there will be some.
[11]
He further added the following (Reasons, para.
33):
[Translation]
[33] Although the problem of delays of
this type is not very serious and the resulting harm is minor, I agree that
harm of this type is irreparable. It is understandable that preventable delays
harm the LPA’s reputation, which is an irreparable outcome: RJR-Macdonald at
p. 341. For example, the LPA’s clients affected by the delays caused by
the unavailability of pilots may choose other options to ship their products in
the future. Even though there is no proof that an LPA client has done this in
the past, I think it is likely to have happened considering the number of
delays in past years.
[12]
The Corporation takes issue with that last
passage, arguing that it contains a number of errors. Despite the fact that
this aspect of the analysis is not as complete and solid as it might have been,
I am unable to detect an error that would allow me to set aside the Federal
Court judge’s conclusion.
[13]
In this regard, suffice it to say that the
judge’s inference to the effect that the delays harm the LPA’s reputation is
not speculative. Rather, it is a logical inference made on the basis of the
evidence. I would add that the Federal Court judge’s finding that the damage to
the LPA’s reputation is difficult to quantify appears to be consistent with
what the Supreme Court set out in the passage from RJR-MacDonald
referred to by the Federal Court judge. Moreover, contrary to the Corporation’s
assertion, I am of the view that there was sufficient evidence before the
Federal Court judge for him to conclude that such harm did exist.
3rd branch: balance of convenience
[14]
The Federal Court judge then turned his
attention to the balance of convenience branch. After having indicated that the
public interest favoured compliance with the contract signed on October
15, 2015 (Reasons, para. 39), he noted that [Translation]
“the pilots likely made their arrangements for the
2015-2016 holiday period…a long time ago” (ibidem).
[15]
With regard to any inconveniences experienced by
the LPA, the Federal Court judge downplayed these while acknowledging their
existence. Beyond the fact [Translation] “[t]hat there is a public interest in ensuring compliance
with contracts” (Reasons, para. 38), the Corporation’s refusal to comply
with its contractual obligations would cause delays, although those delays
would be fewer than anticipated (Reasons, para. 40).
[16]
Ultimately, it was maintaining what the Federal
Court judge perceived to be the status quo that appears to have tipped
the scale in the Corporation’s favour (Reasons, para. 41):
[Translation]
[41] Each of the parties argues that the
principle of maintaining the status quo goes in its favour. The Corporation
maintains that the status quo means keeping the 2015 schedule, whereas the LPA
contends that the status quo requires compliance with the new contract between
the parties. I agree with the Corporation. The LPA asks that the Corporation be
ordered to modify the 2015 schedule. The status quo requires that I not
impose such an order. (Emphasis added.)
[17]
In reaching this conclusion, the Federal Court
judge erred with regard to the applicable legal rule. In order for the 2015
Schedule to represent the status quo, it would have required the Federal
Court judge to have reached the opposite conclusion than the one he made with
regard to the existence of a serious issue. Indeed, his conclusion was that the
Corporation had been aware of the new requirements since June 2015 and that it
had an obligation to meet those requirements from the moment the contract was
signed, despite the 2015 Schedule. Therefore, the 2015 Schedule did not
represent the status quo as the status quo was based on the
requirements set out in the contract signed in October 2015.
[18]
It follows that the only ground that favours the
Corporation under the balance of convenience branch is that it would be [Translation] “inconvenient
for pilots to have to change their arrangements…” for the 2015-2016
holiday period (Reasons, para. 39). This is no doubt true. However, the only
reason this unfortunate situation exists, according to the Federal Court judge’s
finding, is that the Corporation failed to draw up a new schedule on the basis
of the new requirements as it should have under the terms of the contract it
had signed. In raising this frustration, the Corporation is doing nothing more
than making a claim based on its own turpitude.
[19]
Given that this is the sole “inconvenience”
selected by the Federal Court judge to tilt the balance against the LPA, it follows
that the third branch also favours issuing the injunction sought.
[20]
I therefore find that the appeal should be
allowed, the order issued by the Federal Court judge set aside, and the order
that he should have issued be issued according to the terms proposed by the LPA,
subject to the date marking the start of the period covered by the
interlocutory injunction being extended to December 26, 2015, in order to
provide the Corporation with a suitable opportunity to comply. I am awarding the
LPA its costs before this Court and before the Federal Court.
“Marc Noël”
“I concur.
Richard Boivin, J.A.”
“I concur.
Donald J. Rennie, J.A.”
Translation
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