Sunshine Village Corp. v. Parks Canada, 2003 FCT 546

Date: 20030502

Docket: T-1359-01

Neutral citation: 2003 FCT 546

Ottawa, Ontario, this 2nd day of May, 2003

Present:           The Honourable Madam Justice Heneghan                                      

BETWEEN:

                                              SUNSHINE VILLAGE CORPORATION

                                                                                                                                                       Applicant

                                                                                 and

PARKS CANADA,

SHEILA COPPS, MINISTER OF CANADIAN HERITAGE,

THE SUPERINTENDENT, BANFF NATIONAL PARK, and

THE ATTORNEY GENERAL OF CANADA

                                                                                                                                               Respondents

                                               REASONS FOR ORDER AND ORDER

INTRODUCTION

[1]                 Sunshine Village Corporation (the "Applicant") brings this application for judicial review relative to the decision made by the Superintendent of the Banff National Park, acting as an employee of the Ministry of Canadian Heritage. In his decision, the Superintendent required payment of the sum of $105,000.00 for a building permit for work proposed to be carried out by the Applicant in the Sunshine Village ski area in Banff National Park.

FACTS

[2]                 The Applicant operates a ski area in Banff National Park known as "Sunshine Village". It operates pursuant to a lease made in 1981 between Her Majesty the Queen and TIW Industries Ltd. The ski area has been in operation for approximately 68 years. The ski facilities include a gondola, that is a lift system that transports skiers from the base facility to the upper village.

[3]                 In December 2000, the Applicant applied to Parks Canada for a development permit pursuant to the Canada National Parks Act, S.C. 2000, c. 32 (the "Act"). It sought the permit to rebuild and construct the gondola.

[4]                 In May 2001, the Applicant applied for a development permit to replace the gondola. The application for this permit referenced POMA of America, the consultant selected by the Applicant to advise in connection with this project.

[5]                 The Applicant required approval from the appropriate Parks Canada (Advisory) Board. That Board considers, among other things, environmental matters. The Applicant submitted a detailed package to that Board in May 2001.

[6]                 Building permit #01-010 was issued to the Applicant on June 27, 2001. The permit said that "the fee of $105,000.00 for this building permit is hereby acknowledged". The building permit also says the building in issue, that is the gondola, has a minimum value of $15,000,000.00.

APPLICANT'S SUBMISSIONS

[7]                 The Applicant is here challenging the calculation of the fee for the building permit and says that the Superintendent erred in law in determining that the fee should be calculated relative to the entire cost of the gondola. It argues that the decision should be reviewed on the standard of correctness.

[8]                 In this regard, the Applicant relies on Pushpanathan v. Canada, [1998] 1 S.C.R. 1982. The Applicant argues that the lack of a privative clause in the Act, means that less judicial deference should be afforded to decisions made under the Act.

[9]                 As well, the Applicant says that the Superintendent, the decision maker, is not an "expert" for the purpose of interpreting the statute and applicable regulations. Finally, the Applicant argues that the purpose of the legislation does not require the decision maker to make a "broad, polycentric decision that involves the weighing of various social, political or economic factors".

[10]            Next, the Applicant argues that the decision was patently unreasonable and incorrect because it was based on an improper reading of the application to rebuild the gondola. The decision maker incorrectly concluded that the entire project qualified as a building or structure pursuant to the National Parks Building Regulations, C.R.C., c. 1114, as amended by SOR/96-427 (the "Regulations") without regard to relevant factors including the erroneous definition of "building or structure".

[11]            The Applicant argues that the permit was granted for the replacement of the gondola and its internal components. The gondola transports skiers to and from the ski area, and is composed of a number of different parts. It includes cabins that are suspended from cables that are supported by towers, as well as a number of mechanical and electrical parts including sheave trains, haul rope, cabins, grips and hangers, drive gear bar, vault drive shaft, terminal mechanism, bull wheels, electrical controls, electric motors, auxiliary diesel engine, excavation ring drive and various spare parts.

[12]            The Applicant says the Respondents erred in calculating the permit fee on the estimated total cost of $15,000,000.00 when the evidence shows that the structural support cost is $3,564,000.00.

[13]            Furthermore, schedule "A" of the permit specifically excludes a number of items that are included in the total estimate of $15,000,000.00. The development permit package submitted by the Applicant included those items in the cost of the proposal.

[14]            The Applicant argues that an object that is made solely for the purpose of locomotion is not a building or structure and relies on [1964] 2 S.C.R. 267">R. v. Springman, [1964] 2 S.C.R. 267 and R. v. Transport Provost Inc., [1996] O.J. No. 987 (Ont. Gen. Div.).

[15]            It submits that the function of the object determines its status as a building or a structure, relying on Gilles Begin Lumber Ltd. v. New Brunswick Geographic Information Corp. (1995), 169 N.B.R. (2d) 29 (N.B.C.A.). Since the gondola serves the primary function of carrying people to the ski area, it is properly described as machinery or equipment, not as a "building or structure". In this regard the Applicant relies on [1973] 2 S.C.R. 792">Melocheville (Village) v. Aluminium du Canada Ltée., [1973] 2 S.C.R. 792.

[16]            The Applicant refers to section 3 of the Regulations which require that any building construction in the Park shall comply with the standards set out in the National Building Code, 1980. This Code defines "building" but does not define "structure".

[17]            Finally, the Applicant submits that the building permit fees set out in the Regulations are discriminatory and ultra vires the Act. Section 16 of the Act authorizes the Governor-in-Council to make regulations. However, according to Schedule 1 of the Regulations, the fee basis for building permits in Banff and Jasper National Parks is different from those for any other national park. In Banff and Jasper, the permit fee is $7.00 per $1,000.00 or fraction thereof of the estimated value of the building or structure; in any other park, the basis is $5.00 per $1,000.00 or fraction thereof.

[18]            The Applicant argues that unless there is express authority to allow regulations to be discriminatory, the regulations must apply equally to every person. In this regard, the Applicant relies on St. Lawrence Cruise Lines Inc. v. Her Majesty the Queen, [1997] 3 F.C. 899 (C.A.).

[19]            The Applicant argues that there is nothing in the Act that allows for this separate and distinct treatment of Banff or Jasper National Parks. Further, the Respondents have not demonstrated any special policy reason for the different treatment of these two parks.

RESPONDENTS' SUBMISSIONS

[20]            Generally, the Respondents take the position that the standard of review is correctness in relation to the interpretation of the Act and the Regulations. However, at the same time, the Respondents argue that there is also a deferential standard of review applicable where the decision maker makes a finding of fact in relation to its interpretation of the legislation. The Respondents submit that the decision here involved the interpretation of "building or structure", and has broad implications for the management of national parks in Canada. Consequently, some deference should be given to the decision maker in this case.

[21]            The Respondents say that the decision to apply the fee of $105,000.00 was correct. They refer to the Regulatory Impact Analysis Statement ("RIAS") for the Regulations and characterize it as being a guide to the interpretation of the Regulations. The Respondents argue that according to the RIAS, cost recovery through this imposition of building and related permit fees is part of the mandate of Parks Canada.

[22]            The Respondents acknowledge that the Regulations do not define the words "building or structure".    However, they argue that both the ordinary meaning rule of statutory interpretation and the purposive approach to statutory interpretation support the conclusion that the gondola is a building or structure.

[23]            Furthermore, the Respondents argue that the components of the gondola all work together to produce an object intended to provide access to the ski areas. The gondola cannot be deconstructed into independent elements for the purpose of defining it. All the parts are intended to operate as a whole, with only one use. Accordingly, it is a "building or structure". The Respondents here rely on Re Assessment Equalization Act (1966), 56 W.W.R. 705 (B.C.C.A.) and [1958] S.C.R. 349">Trans Mountain Oil Pipeline Co. v. Jasper School District No. 3063, [1958] S.C.R. 349.

[24]            As for the difference in the calculation of the fee for Banff and Jasper National Parks, the Respondents say that this is only a distinction which is not discriminatory in itself. Further, the Respondents submit that the decision in St. Lawrence Cruise Lines Inc., supra, is distinguishable.

[25]            The Respondents argue that the Applicant enjoys significant commercial advantages from its operation in Banff National Park. The imposition of a fee that offsets costs "makes eminent good sense".

ANALYSIS

[26]            This application challenges the basis for calculating the fee for a building permit relating to replacement of a gondola in the Banff National Park.    There are two questions arising from this application: is the gondola a "building or structure" within the meaning of the Regulations and was the fee properly calculated? The latter question includes a determination of the appropriate base value and whether the Regulations are discriminatory. Since these questions involve statutory interpretation, the applicable standard of review is correctness.

[27]            The relevant statutory provisions are sections 4, 8 and 16(l)(a), (m), (n), (r) and 16(3) of the Act. They provide as follows:

[28]            Sections 2(1), 3, 5(1) and Schedule I, Part I of the Regulations are also relevant and provide as follows:

SCHEDULE

(Subsections 11.1(8) to (10) and 15(1))

PART I

FEES FOR PERMITS

Column I                                                                                                                          Column II

Item                          Type of Permit                                                                                                               Fee ($)

1.              Building permit, per $1,000 or fraction thereof of estimated

value of the building or structure

(a)            in Banff or Jasper National Park                                                                              7.00

(b)            in any other park                                                                                                         5.00

ANNEXE

(paragraphes 11.1(8) à (10) et 15(1))

PARTIE I

DROITS DE PERMIS

Colonne I                                                                                                                         Colonne II

Article                      Permis                                                                                                                              Droits ($)

1.              Permis de construction, pour chaque tranche de 1_000_$ ou

fraction de celle-ci de la valeur estimative du bâtiment ou de

la construction_:                   

a)              dans les parcs nationaux Banff ou Jasper                                                             7

b)             dans tout autre parc national                                                                                    5

[29]            Section 4 of the Act is a general statement of the purpose of the legislation and the purpose of national parks. National parks are created for the "benefit, education and enjoyment of the people of Canada, subject to the Act and Regulations". Section 8 states that the Minister is vested with the control and management of the parks.

[30]            Pursuant to section 16(1) of the Act, the Governor-in-Council may enact regulations for various purposes including the construction of buildings, structures and other improvements, the control of businesses including commercial ski facilities, and the determination of rates and fees and the issuance of permits. Section 16(3) identifies the authority of the Superintendent of a park to issue permits in accordance with the Regulations.

[31]            The statutory and regulatory provisions referred to above form the legislative context for this application which involves a determination of the status of the gondola as a "building or structure". The Regulations do not define "building or structure" but incorporate by reference the National Building Code of Canada 1980, which defines "building" as follows:

Any structure used or intended for supporting or sheltering any use or occupancy.

[32]            The parties have submitted opposing arguments as to how this definition applies to the gondola in question. The Applicant submits that it does not because the item is used primarily for transportation and in any event, it can be broken down into various separate components, the value of which should be independently assessed for the purpose of determining the cost of the permit.

[33]            In [1964] 2 S.C.R. 267">Springman, supra, the Supreme Court of Canada concluded that a bunkhouse on wheels was not a building for the purposes of the Criminal Code, 1953-54 (Can.), c. 51. In its decision, at page 273, the Court referred to and quoted from Denning L.J. (as he then was) in Cardiff Rating Authority v. Guest Keen Baldwin's Iron & Steel Co. Ltd., [1949] 1 All E.R. 27 at 31 as follows:

A structure is something which is constructed, but not everything which is constructed is a structure. A ship, for instance is constructed, but is not a structure. A structure is something of substantial size which is built up from component parts and intended to remain permanently on a permanent foundation, but it is still a structure even though some of its parts may be moveable, as, for instance about a pivot. Thus, a windmill or a turntable is a structure. A thing which is not permanently in one place is not a structure, but it may be "in the nature of a structure" if it has a permanent site and has all the qualities of a structure, save that it is on occasion moved on or from its site.

[34]            The Supreme Court went on to say, in [1964] 2 S.C.R. 267">Springman, as follows at page 273:

We are not concerned here with anything "that is in the nature of a structure". We have to deal with items that are either "buildings" or "structures".

My view that the items in question in this appeal are neither "buildings" nor "structures" is strengthened by the judgment of the Manitoba Court of Appeal in Rex v. Arpin in which it was held that a railway freight car was not a "building" within the meaning of s. 461 of the Criminal Code of Canada, and by the judgment of the Supreme Court of Nova Scotia en banc in The King v. Levy and Gray, in which it was held that the buffet of a parlour car on a railway was not a "building" within s. 461 of the Code. In this latter case Chisholm J. (as he then was) said at p. 232:

I have come to the conclusion that the buffet of a parlour car is not a building within the meaning of section 461 of the Criminal Code. A building is defined by Bouvier (p. 400) as "an edifice", erected by art and fixed upon or over the soil, composed of brick, marble, wood or other proper substance, connected together, and designed for use in the position in which it is so fixed.

[35]            In R. v. Transport Provost Inc., supra, the Court dealt with the question of whether the term "structure", as used in the Canada Labour Code and the Canada Occupational Safety and Health Regulations, included tanker trucks.

[36]            The Court applied both the "ordinary meaning rule" of statutory interpretation and a purposive analysis in coming to the conclusion that tanker trucks were not included in the term "structure". It considered the decision in Cardiff Rating Authority, supra. The Court also applied section 12 of the Interpretation Act, R.S.C. 1985, c. I-21, and acknowledged the need to interpret legislation in a manner that best ensures the attainment of legislative objectives. The court reached the following conclusion at paragraphs 34 and 35:

I am satisfied that the ordinary meaning of structure cannot include a truck or tank trailer.

Applying an expanded meaning to the word structure, since the legislation is remedial by nature, it cannot in my view include a truck or tank trailer which are mobile vehicles. Under certain circumstances, if a tank trailer were converted to a non-mobile permanent use similar to a house trailer, then it might qualify under the expanded definition. The legislature must have considered this issue, since it dealt with unguarded structures, temporary structures and ladders in section 12.10.

[37]            The Applicant relies on these decisions but in my opinion, they do not assist. The approach taken by Denning L.J. (as he then was), in Cardiff Rating Authority, supra, remains persuasive.

[38]            The gondola here in issue is composed of many parts, including two towers that are permanently affixed to the ground. The gondola is operated electrically and is carried by cables. Its sole purpose is to transport people. While doing so, it houses them by protecting them from the elements. It is a "building" within the meaning of the National Building Code, and consequently, for the purpose of Regulations, the gondola is correctly considered a "building or structure".

[39]            I am not persuaded by the Applicant's argument that the gondola can be de-constructed into separate components for the purpose of calculating the permit fee. It is the sum of its parts.

[40]            I draw this conclusion from the evidence submitted, in particular the application for the building permit. This includes a description of the various items that are required to construct and install the gondola. While it is clear that any number of these items can be employed for other uses, it is also apparent that they were, and continue to be, necessary to build and operate the gondola.

[41]            Furthermore, a purposive analysis also supports the finding that the gondola in this case is indeed a "building or structure" pursuant to the Regulations. Here, the overall purpose of the Act is to preserve, protect, manage and control Canada's national parks: see Young et al. v. Canada (Attorney General) (1999), 174 F.T.R. 100 and Bow Valley Naturalists Society v. Canada (Minister of Canadian Heritage) (1999), 175 F.T.R. 122, affirmed, [2001] 2 F.C. 261 (C.A.).

[42]            The Regulation under review aids in this purpose by establishing a basis for calculating fees for permits, thus controlling the way in which buildings and structures are built upon park lands. Concluding that Sunshine Village's gondola is a "building or structure" furthers the above objectives of the Act.   

[43]            The final issue is whether Schedule I, Part I of the Regulations, which provides a different base amount for calculating the cost of a building permit in Banff and Jasper National Parks, is discriminatory because it is higher than the base used in relation to all other national parks.

[44]            The Respondents argue that a difference in the base rate does not amount to discrimination but reflects a legitimate goal of increasing revenues. Here the Respondents rely on the RIAS which provide in part as follows:

This amendment raises building and related permit fees to levels comparable to those charged in surrounding jurisdictions. Existing permit fees have not been increased in many years and are currently a fraction of those charged in surrounding jurisdictions. Parks Canada currently recovers only a small portion of its administrative, monitoring, and planning costs associated with construction in national parks. This amendment will bring revenues from fees closer to 100% recovery of costs incurred for provision of the service. According to Treasury Board policy, it is Parks Canada's responsibility to recover such service costs from those who directly benefit from them.

[45]            The Federal Court has held that the RIAS, while not a part of the regulations, is a useful tool in analysing the legislative intent as it was prepared as part of the regulatory process: see Merck & Co. v. Canada (Attorney General) (1999), 176 F.T.R. 21 and Bayer Inc. v. Canada (Attorney General) (1999), 87 C.P.R. (3d) 293 (F.C.A.).

[46]            In this case, the RIAS addresses the reason why building and related permit fees, overall, were raised to levels comparable to those charged in other jurisdictions. However, this document does not speak to the purpose behind the differentiation in fees charged between Jasper and Banff National Parks on one hand and all other parks on the other. In my opinion, the RIAS does not further the Respondents' submission in this regard.   

[47]            The Respondents' have failed to show that the Act authorizes this differential treatment in fee calculation. The Act authorizes the Governor-in-Council to enact regulations covering fees for permits, that is pursuant to section 16(1)(r). It does not say that differential fees may or shall be imposed for different parks falling within its scope.

[48]            Certain cases from the Supreme Court of Canada, which were not raised by the parties, are relevant to the issue of discrimination. That issue is clearly raised in this application. In Montreal (City) v. Arcade Amusements Inc., [1985] 1 S.C.R. 368, the Supreme Court of Canada stated at page 404:

The rule that the power to make by-laws does not include that of enacting discriminatory provisions unless the enabling legislation provides the contrary has been observed from time immemorial in British and Canadian public law...

Further at page 406 the Court noted:

Contemporary academic opinion in Quebec, inter alia, recognizes the rule stated by Lord Russell of Killowen in Kruse v. Johnson, supra. Thus, Louis-Philippe Pigeon wrote in Rédaction et interprétation des lois, 1978, at p. 34:

[TRANSLATION] Another important observation has be made regarding the regulatory power. It is the following: the power to make regulations does not include a power to adopt discriminatory provisions. In other words, unless the legislation authorizing it states the contrary a regulation must apply to everyone in the same way. If the intent is to make a distinction, this must be stated.__One of the interesting decisions on this point is Rex v. Paulowich, (1940) 1 W.W.R. 537; and there are many others.

Similarly, in their Traité de droit administratif, t. I, 1984, p. 558, Rene Dussault and Louis Borgeat observed:

[TRANSLATION] This rule clearly has the corollary that any discriminatory regulation not authorized by legislation is illegal.

[49]            In Forget v. Quebec (Attorney General), [1988] 2 S.C.R. 90, the majority of the Supreme Court of Canada held that a section of the Charter of the French Language, R.S.Q. 1977, c. C-11, which authorized the enactment of regulations related to the evaluation of language proficiency for professionals who had to obtain permits to practice in "professional corporations" were intra vires the enabling statute. Justice Lamer, as he then was, for the majority of the Court, stated the following at page 105 and 106:

In theory, the power to regulate does not include the power to discriminate. Accordingly, where a statute contains no authorization, express or implied, a discriminatory regulation may be challenged and set aside. This rule was recognized by this Court in City of Montreal v. Arcade Amusements Inc., [1985] 1 S.C.R. 368...

In the absence of express provisions to the contrary or delegation by necessary implication, the legislator reserves the exclusive right to discriminate. [Emphasis added]

[50]            Regulations which deal with differential treatment may be permitted as long as the governing legislation, either expressly authorizes such treatment or such authorization may be implied as a necessary incident of the powers delegated under a statute: see R. v. Sharma, [1993] 1 S.C.R. 650, at 668, Allard, infra, paragraph 80, Forget, supra, pages 105-6 and Arcade Amusements, supra, pages 413-14. See also Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231.

[51]            In Allard Contractors v. Coquitlam, [1993] 4 S.C.R. 371, the Supreme Court of Canada considered whether municipal by-laws which mandated a fee for a permit for the removal of soil and other substances from municipal land, such fee being dependant on the volume of soil removed, were discriminatory. The fee had previously been charged at a flat rate and as a consequence of the change in fee calculation, commercial extractors had a great increase in fees, comparative to non-commercial users.

[52]            There, the Supreme Court of Canada held that the by-laws did distinguish between commercial and non-commercial use, however such discrimination was authorized by section 930(2) of the Municipal Act which stated:

(2) The council may, by bylaw, impose a fee for the removal referred to in subsection (1) (d) or for the deposit referred to in subsection (1) (e) and the fee may impose a charge for each volumetric unit, as provided in the bylaw, of soil, sand, gravel, rock or other substance removed or deposited and the volumetric fee may be different for different areas of the municipality.

[53]            In Sharma, supra, the Supreme Court of Canada held that the general reasonableness or rationality of a municipal by-laws which drew a distinction between free-standing vendors and owner/occupant vendors was not authorized by the enabling statute, the Municipal Act and accordingly were ultra vires. The Court stated that the general reasonableness or rationality of the by-laws was not the issue but rather the real issue was whether the discriminatory treatment was specifically authorized by the enabling legislation or where the discrimination is a necessary incident to exercising the power delegated by, in that case, the province.

[54]            Cases such as Arcade Amusements, supra, Forget, supra, Allard, supra and Sharma, supra, effectively illustrate that subordinate legislation made pursuant to the authority of an enabling statute must remain within the boundaries established by such legislation.   

[55]            In the present case, I find no express authority from the enabling statute for the authorization of differential fees, nor can I see how such authority could be implied as a necessary incident of the powers delegated under the Act. Section 4 of the Act states the purpose of having national parks. Sections 8 to 12 deal with administration of national parks. Sections 16 and 17 authorize the Governor-in-Council to enact regulations for different purposes. Nothing in the Act authorizes differential treatment in the matter of calculating fees.

[56]            The Respondent filed the affidavit of Robert John Layton, an acting Senior Development Officer responsible for Banff, Yoho and Kootenay National Parks. Mr. Layton deposed that the current rate has been uniformly applied to lift construction activities at all of the four ski hills in these mountain parks.

[57]            The Act contains specific provisions concerning the operation of commercial ski operations in Banff National Park; see for example, section 36. The Act expressly refers to Banff National Park for specific purposes, the imposition of a different fee structure not being one of them. This indicates that if Parliament wanted to provide for the authority to make regulations which differentiated Banff National Park from other national parks, for the purpose of fees, it would have done so. However, the power conferred on the Governor-in-Council to make regulations does not authorize explicitly or otherwise, a differential basis for the imposition of fees.

[58]            The RIAS does not override the Act. The basis for the differential fees must have a statutory basis. It is equally irrelevant that the Respondents have a habit of imposing different fees for different parks. That part of the Regulation is ultra vires. Accordingly, the application is allowed in part.

[59]            The entire gondola was properly found to be a "building or structure". However, the cost of the fee for the permit should have been assessed at $5.00 per $1,000.00 or fraction thereof, of the gondola's estimated value. The cost of the permit shall be recalculated in accordance with these reasons and a refund given to the Applicant.

[60]            Costs are reserved, pending submissions from the parties.

                                                  ORDER

The application is allowed, in part. That part of the Regulation contained in Schedule I, Part I, establishing a differential basis for a building permit fee in Banff National Park, is ultra vires. The cost of the fee for the building permit is to be recalculated at $5.00 per $1,000.00 or fraction thereof, of the gondola's estimated value and a refund given to the Applicant. Costs are reserved, pending submissions from the parties.

                                                                                         "E. Heneghan"

                                                                                                     J.F.C.C.

                          FEDERAL COURT OF CANADA

                                       TRIAL DIVISION

    NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                   T-1359-01

STYLE OF CAUSE: Sunshine Village Corporation v. Parks Canada, Sheila

Copps, Minister of Canadian Heritage, The

Superintendent, Banff National Park, and The Attorney

General of Canada

PLACE OF HEARING:                                   Edmonton, Alberta

DATE OF HEARING:                                     November 5, 2002

REASONS FOR ORDER AND

ORDER:                    The Honourable Madam Justice Heneghan

DATED:                      May 2, 2003

APPEARANCES:

Mr. Daniel Carroll                                                FOR APPLICANT

Mr. Kirk Lambrecht, Q.C.                                               FOR RESPONDENTS

SOLICITORS OF RECORD:

Field Atkinson Perraton                                                    FOR APPLICANT

Edmonton, Alberta

Morris Rosenberg, Q.C.                                                   FOR RESPONDENTS

Deputy Attorney General of Canada