Blue Line Car Leasing Ltd. v. Halifax International Airport, 2001 FCT 296

Date: 20000406

Docket: T-1841-99

Neutral Citation: 2001 FCT 296

BETWEEN:

                                      BLUE LINE CAR LEASING LIMITED

and ARIS MASTRAPAS

Applicants

- and -

JANET SHRIEVES, Airport Manager for

the Halifax International Airport

Respondent

REASONS FOR ORDER

MacKAY J.

[1]                This is an application under section 18.1 of the Federal Court Act, R.S.C. 1985, c.F-7 as amended, by Blue Line Car Leasing Ltd. ("Blue Line") and its principal shareholder, Mr. Aris Mastrapas, for judicial review of and an order quashing a decision by Janet Shrieves, Airport Manager of the Halifax International Airport. That decision promulgated, as part of "Airport Licensing Requirements", that taxi owners (as well as drivers) pass a knowledge examination as a precondition to obtaining a licence to pick up passengers at the airport. The applicants also seek mandamus.

1. The Facts

[2]                Blue Line is a limited company which owns and operates a fleet of 57 taxicabs in the Halifax Regional Municipality ("HRM") under "roof-light" licences issued by HRM. Blue Line leases cars and meters to licenced taxicab drivers who then work independently or with one of the local taxicab dispatching companies. Once a car is leased to a taxicab driver, Blue Line continues its responsibility to maintain the car, using its own maintenance facility. Blue Line does not provide taxicab service to the general public, does not dispatch taxis or employ drivers or provide them with radios.

[3]                Aris Mastrapas is the president and sole shareholder of Blue Line Car Leasing Inc. He was born in 1945 in Greece, and he came to Canada as an immigrant in 1968. He has limited education and speaks and writes English with difficulty. He maintains an HRM taxicab driver's licence although he has not driven a taxicab for 12 years.

[4]                In 1999, Blue Line, through Mr. Mastrapas, applied for nine Airport Taxicab Licenses for cars to obtain the right to pick up passengers at the Halifax International Airport. Under requirements established in 1999, to operate a taxi that is not owned by the driver at the Halifax International Airport, two separate licences are needed in addition to the taxi vehicle licence and the taxi driver's licence issued by HRM, i.e., an Airport Taxi Licence for an owner or an owner/driver, issued by airport authorities to roof-light owners, and the airport taxi driver certificate, issued by airport authorities to drivers. Thus, to operate a taxicab at the Halifax International Airport, the driver and the taxicab must both be licenced by airport authorities.

[5]                Taxicab services, like other commercial undertakings at airports which are under the management of the Minister of Transport, as the Halifax airport was at the time the applicants sought licences, are regulated by the Government Airport Concession Operations Regulations (the "Regulations"), and by the administrative policies promulgated by the local Airport Manager. Janet Shrieves, respondent, is the Airport Manager for the Halifax International Airport, and as the senior Department of Transport official there, she was responsible to oversee the administration of the Regulations.

[6]                For airports, including the Halifax International Airport, which are not designated under the Regulations, taxicab services are regulated pursuant to subsection 7(1) of the Regulations, and by licence conditions established thereunder by the local Airport Manager.

[7]                An Airport Taxi Committee (the "Committee"), comprised of several taxi licensees, exists at the Halifax International Airport to assist Department of Transport authorities with taxicab licensing issues. In 1991, when the Committee complained that there were too many airport taxi licences, airport officials responded by not issuing new licences from 1991 to 1994. When the freeze was lifted in 1994, a new pre-requisite was added before an Airport Taxi Licence could be obtained by an owner/driver or by a driver: a knowledge examination. Licences for the five-year term 1994 to 1999 were issued only to owner/drivers of vehicles, and to drivers, since no party owning a taxi who was not also its driver made application for a licence.

[8]                In review of arrangements to apply after 1999, the Committee was concerned that licenced owners could absent themselves from the Halifax area ("absentee owners"), while continuing to lease their vehicles to licenced drivers. The Committee suggested that the problem of absentee owners might be remedied by administering a knowledge examination to owners as well as to drivers. Ultimately, Department of Transport authorities at the airport, on behalf of the Manager, accepted a recommendation that commencing in 1999 drivers and roof-light owners who had not been licenced during the previous five-year term be required to pass a knowledge examination before being granted a licence.   

[9]                In August of 1999, advertisements for a "taxi service opportunity" were placed in local newspapers directing interested parties to contact the airport's Ground Transportation and Parking Officer, who instructed them to pick up a package of materials concerning licensing procedures. Mr. Mastrapas responded to the advertisement as it directed, by telephone, and a time was scheduled for him to take the knowledge examination.

[10]            On the basis of his telephone response the applicant was listed as an owner/driver in the examination schedule even though Mr. Mastrapas was applying on behalf of Blue Line for nine Airport Taxi Licences. At least in retrospect it is clear he intended at the time to be applying as an owner. From the record it appears that any error about his intention at the time is not significant, for owners and owner/drivers, as well as drivers were required to take the same test.

[11]            Mr. Mastrapas took the knowledge examination on September 8, 1999, and failed, obtaining 72%. He was permitted to rewrite the examination on September 13, 1999, but failed again, scoring 74%. The pass mark for the knowledge examination was 80%.

[12]            From the affidavit of Wayne Black, Ground Transportation and Parking Officer for the Halifax International Airport, sworn November 22, 1999, the knowledge examination consisted of two components, questions concerning taxi operating geographic knowledge and some local historical knowledge, and questions concerning procedural matters, some specific to the airport and some more general in nature. Questions for the second part of the test concerning procedures to be followed at the airport were based on written materials provided to all interested parties in advance of the examination. Mr. Black also avers that the applicant erred in responses to questions on both parts of the examinations he undertook, and he further notes that for many individuals who wrote the examinations, and many who were currently licensees, English is not their first language.

[13]            As a result of Mr. Mastrapas having failed the examination, Blue Line could not proceed with its application. Since the opportunity to apply in September 1999 was the only one anticipated for five years Blue Line cannot expect to be licenced for service at the Halifax airport until 2004, unless the current situation for licences changes. Drivers who lease cars from the applicant corporation cannot pick up fares from the airport using those cars, even though the drivers possess Airport Taxi Driver's Certificates.

[14]            On September 21, 1999, the applicants' counsel requested that Blue Line be exempted from the examination because it is a corporation, or that another Blue Line representative be permitted to write the exam on behalf of the company. By letter dated October 5, 1999, counsel advised that the Department of Transport declined to consider the matter, expressing the view that the knowledge test requirement was within discretion of the Airport Manager.

[15]            This application for judicial review was filed on October 2, 1999. The applicants seek: an order quashing the knowledge test for owners as an unreasonable exercise of the respondent's authority; declaratory relief, that the respondent breached the duty of fairness owed to the applicant, and further that the respondent has unfairly discriminated against the applicants by breaching his Charter rights to equal treatment under the law, and an order in the nature of mandamus that the respondent consider afresh the applicants' application in a non-discriminatory manner.

[16]            Taxicab licencing requirements at Halifax International Airport are established pursuant to s-s. 7(1) of the Regulations, which provides:

[17]            In addition, the Airport Manager, the respondent, issued two administrative documents providing for taxicab licences or permits, for taxicabs operating at the airport to pick up passengers. The first, dated September 1999, was Taxi Licencing Requirements, Halifax International Airport, which required, inter alia,

Roof light owners and drivers not licensed at the airport under the previous 5 year term must write and pass a knowledge exam. ...Proof of a current H.R.M. license will be required to the write (sic) exam....

The requirements also stipulated different fees (presumably for a licence) for an Owner, an Owner/Driver, and a Driver, respectively.

[18]                        The second document, issued by the Airport Manager applicable October 1, 1999 for a five-year term, was "Conditions of Airport Taxi Licence" which provided, inter alia,

The Airport Taxi Licence and/or Driver's Certificate shall be issued at the discretion of the Airport General Manager on the basis of public necessity and convenience having due regard to any previous violations of these terms and conditions or of the Government Airport Concession Operations Regulations.

The Airport General Manager reserves the right to change or add to the terms of the Airport Taxi Licence or the licencing procedures.

Taxicab Owner:

Person or company which owns in its name a motor vehicle for which a Taxi Owners Licence has been issued by the Halifax Regional Municipality (H.R.M.).

The conditions then set out operating requirements including vehicle requirements for taxis serving the airport, requirements for every licence holder, including insurance coverage, and requirements for ensuring the vehicle is operated in accord with procedures and operating instructions for drivers serving the airport.

Issues

[19]            The primary issue for consideration is the standard of review to be applied in dealing with the application for review of the decision to require an owner to pass a knowledge examination. A secondary issue concerns the exercise of discretion concerning the application of the requirement for the knowledge exam utilized in this case, including the applicants' claims that this was unreasonable, unfair and discriminatory.

[20]            In argument, both written and oral, on behalf of both parties, there is some confusion about these issues. In the application for judicial review the applicants question the decision to require owners to undergo a knowledge examination. That, in my view, is the primary issue here raised. Other aspects of argument concern the decision to require owners to undertake the same exam as drivers, and the decision in this case to refuse a licence to a corporate applicant when the individual applicant appearing on its behalf did not succeed in passing the examination.

Analysis

[21]            The purposes and objects of a statute prescribe the limits of the legal authority of a decision-maker exercising discretionary power. The discretion granted must be exercised in good faith within those purposes and objects. In [1959] S.C.R. 121">Roncarelli v. Duplessis, [1959] S.C.R. 121 at 140, Mr. Justice Rand stated:

In public regulation of this sort there is no such thing as absolute and untrammelled "discretion", that is that action can be taken on any ground or for any reason that can be suggested to the mind of the administrator; no legislative Act can, without express language, be taken to contemplate an unlimited arbitrary power exercisable for any purpose, however capricious or irrelevant, regardless of the nature or purpose of the statute. Fraud and corruption in the Commission may not be mentioned in such statutes but they are always implied as exceptions. "Discretion" necessarily implies good faith in discharging public duty; there is always a perspective within which a statute is intended to operate; and any clear departure from its lines or objects is just as objectionable as fraud or corruption. Could an applicant be refused a permit because he had been born in another province, or because of the colour of his hair? The ordinary language of the legislature cannot be so distorted.

[22]            The purpose of the Regulations applicable in this case was discussed by the Nova Scotia Court of Appeal in R. v. Grenkow (1990), 98 N.S.R. (2d) at 316 (C.A.), in part in the following terms:

The purpose of the Regulations is, as stated in their title, for "The Control of Commercial and Other Operations at Government Airports". It is a reasonable objective to subject commercial businesses at airports to some measure of control and thus permit the flow of both pedestrian and vehicular traffic in an orderly fashion. Otherwise the purpose for which airports exist could be adversely affected by the inability to gain speedy entrance and exit. This is especially so in the case of vehicular traffic.

                              The authority of the federal government to regulate traffic and commercial activity at airports was upheld by the Supreme Court of Canada in [1962] S.C.R. 5">Desrosiers v. Thinel [1962] S.C.R. 5l5. ...

...

GACOR is, by s. 3, applicable to every airport under the management and control of the Minister. That includes Halifax which "belongs to or is occupied by Her Majesty in right of Canada". Section 4(1) provides that the Minister may designate any airport, such as Halifax, as one at which a permit is required to operate a commercial vehicle, such as the taxi operated by the respondent. As earlier noted, the record reveals that the Minister, while having so designated some airports, has not designated Halifax as one requiring a permit to operate a taxi. Therefore it follows that the subsequent provisions in GACOR that specifically refer and apply to the operation of taxis by permit, including the cancellation of such permits, do not apply to Halifax because it is not a designated airport.

However, s. 7 applies to all commercial undertakings at all airports. This includes Halifax. Section 7 states in part,

7. ..., except as authorized in writing by the Minister, no person shall

(a) conduct any business or undertaking, commercial or otherwise, at an airport; ...

The effect of this section is to prohibit any person from conducting a commercial business at any airport (Halifax) unless the Minister authorizes it in writing. There surely can be no quarrel with the proposition that a person who operates a taxi at the Halifax Airport is conducting a commercial business. To do that requires an authorization in writing by the Minister. The fact that Halifax was a non-designated airport at the times material to this appeal did not remove it from the general application of s. 7. ...

[23]            While the wording of s-s. 7(1) may be different from s. 7 as discussed in Grenkow the purpose of the section as described in that decision is apt. It is a reasonable objective within the regulations to subject commercial taxicab services at the Halifax International Airport to a measure of control to facilitate the flow of pedestrian and vehicular traffic in an orderly fashion, and establish minimum requirements for vehicles, and for a level of professionalism among drivers who interact with the public.

[24]            A goal of requiring taxicab owners to undergo the knowledge examination, in the view of the Airport taxi advisory committee, was to avoid absentee ownership of licences.    I am not persuaded on the evidence that this was accepted by the respondent as the principal basis for requiring owners to undertake the knowledge exam, despite the acknowledgment in his examination by Wayne Black, affiant on behalf of the respondent, that the recommendation of a knowledge exam requirement was accepted by airport authorities. By his affidavit Wayne Black states, in part:

11.            The licensing procedure applies to all individuals who are a rooflight owner and operate a taxi vehicle ("owners/operators"), drivers who lease or drive for a rooflight owner ("operators") and the owners of the rooflights ("owners"). All three groups must write and pass a knowledge exam.

12.            The majority of applicants are either of the categories of owner/operators or operators. However, at the present time, approximately four owners have licenses at the Airport.

13.            Transport Canada maintains that owners require a license because, as the supervisor of the operators who lease or drive their vehicles, they must have a firm understanding of the Airport's procedures.

14.            As owner, as the proprietor of the vehicle and of the rooflight, is ultimately responsible for the care and control of the vehicle.

15.            Under Part IV of the Conditions, demerit points are given for a variety of violations, including failure to repair taxicab after a first warning, failure to provide valid insurance, refusing to accept a credit card. By requiring that the owner of the rooflight obtain a license, this ensures that the rooflight owners remain accountable for the sound mechanical condition of their vehicles.

16.            The daily enforcement of the Conditions, is the responsibility of the Ground Transportation Inspectors ("GTI"). The Conditions are to ensure effective taxi services are provided to the travelling public and that order and safety is maintained at the Airport.

17.            Failure to follow the directions of the GTI's could result in the issuance of demerit points, and ultimately the suspension or cancellation of the owner's Airport Taxi License as well as the operator's Drivers' Certificate. As such, these penalty provisions potentially affect not only an operator, but the owner of the rooflight.

[25]            In Baker v. Canada (Minister of Citizenship and Immigration), (1999), 174 D.L.R. (4^th) 193 (S.C.C.) Madam Justice L'Heureux Dubé, writing for the Supreme Court of Canada, said in part:

Administrative law has traditionally approached the review of decisions classified as discretionary separately from those seen as involving the interpretation of rules of law. The rule has been that decisions classified as discretionary may only be reviewed on limited grounds such as the bad faith of decision-makers, the exercise of discretion for an improper purpose, and the use of irrelevant considerations: see, for example, [1982] 2 S.C.R. 2">Maple Lodge Farms Ltd. v. Government of Canada, [1982] 2 S.C.R. 2 at pp. 7-8, 137 D.L.R. (3d) 558; Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231, 110 D.L.R. (4^th) 1. A general doctrine of "unreasonableness" has also sometimes been applied to discretionary decisions: Associated Provincial Picture House, Ltd. V. Wednesbury Corp., [1948] 1 K.B. 223 (C.A.). In my opinion, these doctrines incorporate two central ideas -- that discretionary decisions, like all other administrative decisions, must be made within the bounds of the jurisdiction conferred by the statute, but that considerable deference will be given to decision-makers by courts in reviewing the exercise of that discretion and determining the scope of the decision-maker's jurisdiction. These doctrines recognize that it is the intention of a legislature, when using statutory language that confers broad choices on administrative agencies, that courts should not lightly interfere with such decisions, and should give considerable respect to decision-makers when reviewing the manner in which discretion was exercised.

...

The "pragmatic and functional" approach recognizes that standards of review for errors of law are appropriately seen as a spectrum, with certain decisions being entitled to more deference, and others entitled to less: Pezim, supra, at pp. 589-90; Southam, supra, at para. 30; Pushpanathan, supra, at para. 27. Three standards of review have been defined: patent unreasonableness, reasonableness simpliciter, and correctness: Southam, at paras., 54-56. In my opinion that standard of review of the substantive aspects of discretionary decisions is best approached within this framework, especially given the difficulty in making rigid classifications between discretionary and non-discretionary decisions. ...

[26]            In my opinion the administrative discretion left to the Minister, or his delegate the Airport Manager, in relation to licensing requirements under s-s. 7(1) of the Regulations is circumscribed only by the purposes and objects of the Regulations, and general principles of administrative law, consistent with the Charter.

[27]            As for the primary issue, the standard of review of the manager's decision to require a knowledge examination, is patent unreasonableness. That standard counsel for the respondent urged and counsel for the applicants was prepared to accept this. I am not persuaded that the manager's decision to require owners to pass a knowledge examination was for an improper purpose or irrelevant consideration. It was not patently unreasonable and the Court will not intervene in relation to that decision.

[28]            I turn to secondary issues. The applicants urge that the requirement for owners to undertake the same written examination as drivers or owner/drivers of taxis operating at the airport was patently unreasonable, because there is no rational basis to conclude that an owner must possess the same knowledge as a driver who is separately licenced and who directly serves the public. It is further urged that the requirement did nothing to promote the objectives of ensuring greater accountability of owners or preventing absentee ownership of licences. I have already declined to find that the latter can be said to be the principal purpose of the arrangements. I am not persuaded that the Court should conclude there was no logical reason for the test as here required, for owners of cars not meeting airport operating requirements, or whose drivers ignored those requirements and were subject to demerit points, were ultimately subject to penalties and demerits. That is at least one basis for concern that owners as well as drivers, have knowledge of the conditions for operation at the airport of taxi services for the public. It cannot be said there was no reason at all for the knowledge exam requirement, and the reasonableness of the exercise of discretion is not to be measured only from the perspective of one category of possible applicants, i.e. owners who did not drive their taxi vehicles.

[29]            In my opinion the Airport Manager's exercise of discretion, based on knowledge of services required for public access and express from the airport, should be set aside on grounds of reasonableness only where it can be said the exercise was plainly patently unreasonable. I am not persuaded that was the case here.

[30]            It is urged by the applicants that the Airport Manager failed to treat the applications for licences fairly by fettering her discretion and slavishly following a rule or guideline that prevented individual merits of the application from being considered. Here it is urged no thought was given to appropriate assessment of a corporation's application, and how if it was to be required, a knowledge test should be administered in the case of such an application. Moreover, it is urged that by requiring a corporate applicant to have a representative pass the knowledge test, the respondent fettered the exercise of her discretion.

[31]            That argument in my view arises ex post facto following two failures of the knowledge exam by the applicant, Mr. Mastrapas, despite assistance given to him in understanding questions asked during the second examination. At the time he took the tests he did not complain that the process was considered by him to be unfair. The requirement of patent unreasonableness is not met simply because Mr. Mastrapas, the representative of the applicant corporation who submitted to the test, had difficulty in passing. I am not persuaded that the requirement that a representative of the corporate applicant pass the knowledge test, established as a basis for qualification of all who were not previously licence holders at the airport, can be considered a fettering of discretion that would warrant the Court's intervention.

[32]            After the failed attempts, the applicants did seek exemption from the knowledge examination, or an opportunity for another representative of Blue Line to submit to the examination. This request was refused. The refusal is not here in issue although in argument counsel for the respondent points out that the applicants had an opportunity to question the examination requirement in their case.

[33]            I am not persuaded that the applicants have established that the process was unfair or discriminatory in effect, because the knowledge test put Mr. Mastrapas at a disadvantage in light of his lack of fluency in English, his limited education, level of literacy, country of origin or lack of recent experience as a taxi driver. An examination system tailored to suit the personal capacities of individual applicants would be a somewhat strained concept of an examination intended to establish some minimum level of knowledge of matters considered important for owners, owner/drivers, and drivers of taxis to know if they are to serve the public at the airport.

[34]            In my opinion there is no ground for considering the requirements for examination in this case to be discriminatory on unlawful grounds, or grounds contrary to rights under the Charter.

Conclusions

[35]            I am not convinced the decision to require owners of taxicabs to be used to pick up passengers at Halifax International Airport to pass a knowledge examination was patently unreasonable.

[36]            Nor was it patently unreasonable, in the circumstances of this case and in light of legitimate purposes of the administrative requirements for licences, to require owners to pass the same knowledge examination as owner/drivers and drivers. The application of that requirement in this case to the application on behalf of the corporate applicant did not raise issues of procedural fairness, fettering of discretion, or discrimination against the individual applicant, Mr. Mastrapas, that would warrant intervention by the Court.

[37]            In light of those conclusions, this application for judicial review is dismissed.

[38]            Nevertheless, it would be surprising if, on review of the circumstances of Blue Line's application, the Airport Manager did not reconsider appropriate arrangements for assessing a corporate applicant for taxi vehicle licence. The applicants' principal concern in my view is the nature of the examinations undertaken by Mr. Mastrapas, which appear more suited to owner/drivers and drivers than to owners. It is open to the manager to review the current arrangements within the term of the current conditions, i.e. before 2004, as I understand the reservation of authority retained under those conditions.

[39]            The respondent asks for and is entitled to costs. They are awarded on the usual party and party basis, and if counsel cannot agree on an amount, they shall be assessed in accord with column III under Tariff B of the Court's Rules.

                                                                                                   (signed) W. Andrew MacKay

                                                                                                                                    JUDGE

OTTAWA, Ontario

April 6, 2001