Docket: T-1097-13
Citation:
2015 FC 257
[UNREVISED ENGLISH CERTIFIED TRANSLATION]
Ottawa, Ontario, February 27, 2015
PRESENT: The Honourable Mr. Justice Roy
BETWEEN:
|
AIRBUS HELICOPTERS CANADA LIMITED
|
Applicant
|
and
|
THE ATTORNEY GENERAL OF CANADA
and
|
THE MINISTER OF PUBLIC WORKS AND
GOVERNMENT SERVICES CANADA
and
|
BELL HELICOPTER TEXTRON CANADA LTD.
|
Respondents
|
JUDGMENT AND REASONS
I.
Introduction
[1]
Airbus Helicopters Canada Limited [Airbus] is
challenging the contract award process conducted on behalf of the Government of
Canada by the Minister of Public Works and Government Services Canada [PWGSC],
which concluded with the purchase of light-lift helicopters to replace the
aging fleet used by the Canadian Coast Guard [CCG].
[2]
The contract was eventually awarded to Bell
Helicopter Textron Canada Ltd. [Bell] on May 9, 2014 (affidavit of Sandra
Howell, September 19, 2014). In fact, Airbus chose not to bid in response to
the request for proposals that was issued by PWGSC on April 3, 2013, following
a consultation process with the industry. Airbus participated in the process
leading up to the request for proposals. Only one bidder, Bell, responded to
Solicitation No. F7013-120014/C, which closed on June 4, 2013.
[3]
The contract is for the purchase of 15
helicopters, and could be worth up to $172 million, according to the press
release that announced the awarding of the contract on May 12, 2014.
[4]
An abridged chronology might be helpful in
explaining the process followed in granting the contract:
March
2012: Federal budget
August 17, 2012: Letter to potential
bidders in the industry inviting them to express an interest in the project
August
29, 2012: First reaction from Airbus
September
4, 2012: Meeting day with industry
September
6, 2012: First day meeting one-on-one with Airbus
November
15, 2012: Second day meeting one-on-one with Airbus
January 11, 2012: Letter from Airbus
clarifying, among other things, the Detailed Mission Requirements it wants to
receive
February 6, 2013: Third day meeting
one-on-one with Airbus; Airbus announces it is withdrawing
February 13, 2013: PWGSC reply
March 4, 2013: Fourth day meeting
one-on-one with Airbus
18 March 2013: Another Airbus
letter on Detailed Mission Requirements
April 3, 2013: Opening of the
tendering period: request for proposals
June 4, 2013: Close of the
tendering period
May 9, 2014: Contract awarded
[5]
This is therefore an application from Airbus for
judicial review under section 18.1 of the Federal Courts Act, RSC
1985, c F-7, challenging the process that led to the request for proposals
and ultimately the contract that was awarded in May 2014. Obviously, since
Airbus did not submit a bid, the request for proposals itself is not being
challenged, but rather the refusal by PWGSC to reconsider and modify certain
technical requirements contained in said request for proposals. According to
Airbus, requests for modifications were refused despite its often repeated
claims that the requirements were tailored specifically to suit Bell. We are
therefore dealing with events prior to the request for proposals, not after it
was issued.
II.
The parties
[6]
Both Airbus (Eurocopter at the time the
procurement process was initiated) and Bell are well known in the aerospace
industry. They both manufacture helicopters and they are competitors. There are
other competitors in this market, but not many. There are only three serious
competitors besides the two protagonists in this case. In fact, the top five
players, along with a few others, all responded to a letter of interest, but only
three pursued this interest, including, of course, Airbus and Bell. Ultimately,
Bell was the only manufacturer to bid.
[7]
Airbus and Bell are Canadian subsidiaries of
companies headquartered outside Canada. As for the Government of Canada, PWGSC
is given responsibility for procurement processes through its enabling
legislation (Department of Public Works and Government Services Act,
SC 1996, c 16), which states that “the
Minister may, on behalf of the Government of Canada, enter into contracts for
the performance of any matter or thing that falls within the ambit of the
Minister’s powers, duties or functions” (section 20). Furthermore,
given that the helicopters were intended to renew the CCG’s helicopter fleet,
the Department of Fisheries and Oceans was involved in the procurement process
(the CCG is an entity within that department and its responsible minister is
the Minister of Fisheries and Oceans; Oceans Act, SC 1996,
c 31, section 41). Finally, the Department of Transport was also
involved given that it is responsible for operating the CCG helicopter fleet
(affidavit of R. Wight). As we will see, other departments also contributed to
the process.
[8]
A users group was therefore created once the
Government of Canada had announced in its March 2012 budget that funds would be
set aside for the purchase of helicopters. This group was composed of officials
from different units within the CCG and the Department of Transport. However,
PWGSC was ultimately responsible for managing the procurement process with the
CCG, which was in charge of defining the technical requirements, since it was
familiar with the various operational requirements. The first draft of the
technical requirements was prepared by this group. The consultations were
conducted based on this document, which was modified over the ensuing months.
This document was the basis for the draft request for proposals that was
completed after the second round of one-on-one meetings with interested
companies. Said document is understood to have been prepared between late
November 2012 and early January 2013. I will be returning to the
governance structure of the procurement process.
[9]
Since this is not a case in which the law
predominates, it is necessary to review the facts with a certain degree of
detail. To succeed, the applicant must meet the burden imposed on it. For their
part, the respondents argue not only that the burden has not been met, but that
their evidence is clear and refutes the applicant’s case.
III.
The theory of the case and the applicant’s
evidence
[10]
The theory of the case put forward by Airbus is
ultimately quite simple. The applicant argues that the request for proposals
that resulted from the consultations conducted by government representatives
was tailored to enable Bell to win. Airbus contends that the technical
requirements were designed based on the specifications for the aircraft
provided by Bell (the Bell 429). Airbus goes as far as to maintain in its
memorandum of fact and law that
[translation]
. . . despite the appearance of an
impartial, fair, open and transparent competitive call for proposals process,
the Government of Canada had decided from the start to award the contract to
Bell, and that the procurement process was conducted in a manner that ensured
that the Bell 429 would be the only aircraft that would meet the project’s
technical specifications.
[Para 3]
(See, to the same effect, the affidavit of
Guillaume Leprince, Airbus Vice President of Sales and Marketing, paras 21 to
24. It was Mr. Leprince who presented the evidence on behalf of Airbus.
The company also used the services of an expert.)
[11]
This is not a trivial accusation. At the
hearing, counsel for Airbus maintained that they were not arguing that there
had been a conspiracy within the government. Nevertheless, the theory of the
case maintains that from the very beginning of the process, the technical
requirements substantially favoured the Bell 429. Requests by Airbus to reduce
the technical requirements did not receive the desired response. Moreover,
Airbus complains that on numerous occasions, it requested additional
information about the profiles of the missions to be conducted by the CCG so
that it could offer alternatives. Rather than satisfy the requirements imposed
by the process, Airbus sought to identify the customer’s needs in order to
address them outside of the constraints of the technical requirements. Clearly,
Airbus wanted to avoid, and even challenge, the onerous technical requirements
imposed by PWGSC by arguing that they could not be required based on the type of
work to be performed by the new helicopters (Mr. Leprince’s affidavit,
paras. 39-41).
[12]
There is no doubt in my mind that Airbus
realized before the consultation process had even begun that it could not
easily meet the original technical requirements, because it very early on asked
not to determine if it could meet the requirements, but rather to receive the
CCG mission profiles. By August 29, 2012, Airbus was already complaining. The
following complaints can be found in its response to the letter of interest
issued by the government on August 17, 2012:
1-4 Insert your key conclusions and
recommendations. Two pages maximum – use the other sections to provide details
Eurocopter welcomes GoC decision to move
ahead with replacement of the current CCG fleet. As planned, holding an
Industry Engagement Session as well as one on one sessions with potential
bidders to finalize the requirements of the RFP is certainly a step in the
right direction. Our comments and recommendations by analysing the contents of
the LOI and the draft copy of the mission requirements include:
- Mission Oriented RFP: GoC should
focus on the specific mission requirements of the CCG and be careful on
including specifications of a given platform as a reference for the RFP. This
approach may limit the numbers of options that may be available to fulfill the
mission requirements and also curtail the competition amongst the bidders. We
are sure GoC wants the best for CCG missions and would be open to discussing in
detail the operational details on the intended use of different class of
helicopters. This way Bidders [sic] will not only be able to answer the
requirements but also propose their respective solutions to the missions
including value added product features that may not have been thought about for
the CCG mission needs.
[At page 6 of 16]
Further on, we read the following in the
conclusion:
9-1 Indicate any other areas of
concern that Canada may be interested/concerned with that would aid in
providing a recommendation for improvement.
Requirements should be more mission oriented
than technically driven. We invite GoC to work with the industry to provide a
solution fitting the operational requirements. GoC should be open to
alternative solutions regardless of the type of aircraft (light, medium, polar)
to ensure suitable solutions for the Canadian Coast Guard of Canada.
Public works should carefully define
requirements to allow several platforms to be compliant in order to have a fair
competition for the benefit of Canada.
[At page 16 of 16]
Airbus had already consulted the Preliminary
Draft CCG Helicopter Requirements Document—Light and Medium Helicopters,
Industry Day, September 2012, which listed a series of technical requirements
and was provided to interested parties for purposes of the initial discussions
between the government and industry, which took place on September 4, 2012.
[13]
Moreover, as early as the industry day
held on September 4, 2012, access was provided to seven CCG mission profiles
describing CCG activities. A document entitled CCG Helicopter Mission Profile
Document was made available. The applicant argues that the description there is
very short. The preliminary technical requirements developed for consultation
purposes in the Preliminary Draft CCG Helicopter Requirements Document—Light
and Medium Helicopters, Industry Day, September 2012, are considered by the
applicant to be too onerous and specific. It wanted to offer alternatives based
on mission profiles. Airbus continued in this vein up until the request for
proposals was issued on April 3, 2013, and the same arguments are presented in
the application for judicial review.
[14]
In addition to quickly forming the
opinion that the technical requirements could not easily be satisfied, the
applicant decided that they favoured Bell, to the detriment of Airbus. This
characterization is very general in nature, and Airbus only precisely
identified a few technical requirements. The evidence presented through the
affidavit of G. Leprince referred to the individual consultation session held on
September 6, 2012. We read the following at paragraph 59:
[translation]
59. We then explained how the
Preliminary Requirements for the light-lift helicopters were discriminatory to
other potential suppliers, including Eurocopter Canada, AgustaWestland, MD
Helicopters and Sikorsky. With regard to light-lift helicopters, we highlighted
the following:
(a) requirement
6.4 states that the aircraft must be certified to operate and fly at an
exterior ambient air temperature between -40°C and +50°C, while the only
aircraft certified to fly at -40°C is the Bell 429;
(b) requirement
7.3.5.1.2 states that the aircraft must be equipped with a bleed air heater
system or equivalent, with an appropriate de-icing capacity to operate in
winter conditions at a temperature of -40°C, while the only aircraft that meets
this requirement is the Bell 429; and
(c) the
combination of requirements 7.3.5.12.1 and 7.3.4.2.1 requires that the aircraft
be equipped with skid landing gear and a four-axis digital automatic flight
control system and flight director, while the only aircraft that meets these
requirements is the Bell 429.
We do not find any greater precision coming
directly from Airbus during the procurement process with regard to the
allegation that the technical requirements were modeled after the technical
specifications of the Bell 429. What is found through an examination of the
evidence is that the alternatives proposed by Airbus over time in fact reduced
the technical requirements. There is therefore a connection between the
technical requirements considered by Airbus to be too stringent and the mission
profiles: if the profiles were shown not to reflect reality, it might be
possible to demand changes to the associated requirements.
[15]
Thus, well after the request-for-proposals
process had already begun, Airbus was still corresponding with PWGSC. This
correspondence continued along the same lines, i.e., with Airbus claiming that
the requirements were too stringent to allow it to participate in the
request-for-proposals process. Some of these requirements had even been
strengthened.
[16]
On April 17, May 2, and May 17, 2013, Airbus
wrote to PWGSC to continue to complain about the mission profiles, arguing that
the technical requirements were too stringent for the mission profiles identified
in these letters.
[17]
The third individual consultation session, held
on February 6, 2013, focused on the comments of a senior Airbus official, who
announced that the applicant could no longer continue its participation in the
process. What had become a mantra was repeated yet again:
This confirms what Eurocopter [since become
Airbus Helicopters Canada Limited] has been telling you for the last 6 months.
The lack of real mission understanding, working only on technical parameters
prevents us to understand the rationale behind the changes of requirements.
It is in the Government of Canada [sic]
best interest to present mission oriented requirements to the industry in order
to obtain a best value proposal for the Coast Guards [sic]. We already
addressed this issue several times in verbal and in written communications.
This is the process followed by the Fixed Wing SAR project for which the
industry consultation is constructively ongoing.
[Exhibit P-30, affidavit of
Mr. Leprince]
[18]
PWGSC responded precisely to the specific
elements raised in the February 6 letter in its letter of February 13, 2013. I
note in particular its response to the Airbus comment to the effect that it had
been serving the CCG with its helicopters for 25 years: “It is understood that Eurocopter has been serving the CCG
for over 25 years and we believe that Eurocopter would have a great
understanding of how the helicopter fleet is currently operating to achieve
their mandate”. The applicant continued to complain about having
insufficient information with regard to mission profiles, or that the profiles
did not justify the technical requirements that were being imposed.
[19]
In fact, Airbus went further than to complain
about the mission profiles provided. In letters sent by Airbus to PWGSC on
January 11 and March 18, 2013, Airbus clarified the information it was seeking
(Exhibits P-26 and P-33 in the affidavit of G. Leprince). I am reproducing the
excerpt, which is identical in the two letters:
The following are a few examples of Detail Mission Requirements as
opposed to technical requirements that could be provided:
• Number of
bases to be equipped for each type
• Number of
vessels equipped for each type
• Description
of Night Mission
◦ Number
of passengers
◦ Length
◦ Load
• Distance
Flown from Shore to Ship for each mission
• Number of
cargo / pax for each mission
• Percentage
of usage for each mission of the helicopter type, per year
• Availability
targets per type, per year
• Description
of the loads
• How
far do you need to go and with how many pax’s
[Letter of January 11, 2013]
Regarding the mission requirements requested, our previous
communications were asking for detailed Mission Requirements as opposed to
technical requirements including but not limited to the following:
• Number of
bases to be equipped for each type
• Number of
vessels equipped for each type
• Description
of Night Mission
◦ Number
of passengers
◦ Length
◦ Load
• Distance
Flown from Shore to Ship for each mission
• Number of
cargo / pax for each mission
• Percentage
of usage for each mission of the helicopter type, per year
• Availability
targets per type, per year
• Description
of the loads
• How
far do you need to go and with how many pax’s
[Letter of March 18, 2013]
I am far from being persuaded that this is
truly an issue of “mission requirements”. It is no longer “mission
requirements” at issue here but the use of the helicopter fleet: where, when
and how the aircraft will be used, rather than responding to the question of
what was involved in the missions. These requests can be seen to originate in
the response provided by Airbus at the very first one-on-one meeting on September
6, 2012. The same list, in the same order, can be found there.
[20]
What is not lacking is repeated requests from
Airbus to be given mission profiles in order to offer alternatives. The
evidence does not show what these alternatives could have been other than to
claim that the requirements were too stringent based on the missions to be
carried out. As has already been pointed out, for some important elements, the
alternatives would ultimately be to decrease the desired performance.
[21]
In fact, the technical requirements identified
by Airbus before this Court always appear to suggest that its aircraft is less
efficient, and not that the requirements are unprecedented. When it comes to a
general allegation, the Court is referred to the working documents, in the form
of tables, prepared by Airbus, which are intended to demonstrate that the
technical requirements only favour Bell (in particular Exhibit P-46 in
Mr. Leprince’s affidavit). The only real precision is actually found in
Mr. Leprince’s affidavit, at paragraph 59, the content of which is
reproduced at paragraph 13 of these reasons. The evidence will show, moreover,
that requirements 6.4 and 7.3.5.1.2 were actually amended during the
consultations.
[22]
Following the fourth day of one-on-one meetings
held on March 4, 2013, Airbus provided details of the technical requirements
that would limit its ability to bid (letter of March 21, 2013, and
affidavit of G. Leprince, at paras 96 to 104). The clear implication is that
the aircraft that Airbus had available did not meet the requirements for
payload and range. These are not simple details. The alternative proposed by
Airbus was to reduce the range or payload. Airbus also complained about the
required blade folding width for the helicopter. This time no alternative was
offered other than to work with the CCG. In terms of the altitude limit for
in-ground effect hover, the alternative was to reduce the payload or the
required altitude (from 7,000 to 6,000 feet). There was also an issue with
regard to the flight director.
[23]
The response received from PWGSC on April 4 was
that the requested reductions to the payload or range represented decreases of
9% and 7% in the requirements, which would have a significant impact on
operations. The same comment was made with regard to the altitude limit for
in-ground effect hover. The response concerning the required blade folding for
helicopter parking was particularly unequivocal:
Your March 21, 2013
letter repeats Eurocopter’s request in the Round 4 meeting of March 12, 2013
that CCG’s maximum blade folding width requirement be 3.8 m to allow Eurocopter
to bid the EC 135. Each and every one of Canada’s requirement (sic) is
based on the missions as described in the Mission Profile document provided to
all bidders, and not on specific makes or models.
As was specifically
described in the March 12, 2013 meeting with Eurocopter, given CCG’s shipboard
hangar door width of 4.08 m, providing a maximum blade folding width of
3.8 m provides approximately 0.14 m of space between the helicopter and
each side of the hangar door. A 0.14 m gap between the door and the helicopter
is insufficient for at-sea operations.
[24]
The applicant offered two additional elements in
support of its position. Airbus presented a witness, Corey Taylor, who had
examined the available documentation and concluded that the original request
for proposals, on which comments from the industry were requested, unduly
favoured Bell. The other element was in regard to a weight exemption obtained
for the Bell 429 helicopter in 2011; Airbus contends that this is proof of the
government’s preference for Bell’s product.
[25]
As for the weight exemption, the evidence shows
that in an e-mail dated June 17, 2010, a Transport Canada official reported to
his supervisor that six months earlier, in December 2009, the CCG chief pilot,
also an employee of Transport Canada, had asked the author of the e-mail about
the possibility of granting a weight exemption at take-off for the class of
helicopters to which the Bell 429 belonged. According to the e-mail, the chief
pilot had indicated that this helicopter would be “a
great aircraft for them.” The e-mail indicated “I
told him the bad news about the GW limit for Part 27 helicopters but we started
throwing the idea around up here in Flight Test and thought why not?”
(GW refers to gross weight). The e-mail concludes by describing the regulatory
difficulties:
From a technical standpoint the 429 is
already or very nearly designed to 7500 lb. The big problem appears to be how
to handle it from the regulatory standpoint. What we were thinking was a flight
manual supplement for 7500 lb for Canadian-registered aircraft only (EMS
operators would love another 500 lb of payload). How we deal with the 7000 lb
max gross weight in 527.1 is another matter. Exemption, special condition,
restricted type certificate…? Anyway, from our perspective in Flight Test, we
support Bell’s proposal. There have been some rumblings about Agusta requesting
a similar increase in Max GW for the new A109 Grand New from EASA but I can’t
vouch for their authenticity. Just some food for thought.
[Exhibit 1 to the affidavit of Michael
Laughlin, Chief Pilot of the CCG, dated November 1, 2013]
When cross-examined by Airbus,
Mr. Laughlin had a very unclear recollection of a conversation that would
have taken place four years earlier.
[26]
The submissions include e-mails between
Transport Canada officials, from which the applicant attempted to extract
evidence of cronyism involving junior officials to prove that the Government of
Canada had demonstrated favouritism toward Bell.
[27]
The applicant also argued that both the American
regulator (the Federal Aviation Administration [FAA]) and the European
regulator (the European Aviation Safety Agency [EASA]) had refused the same
exemption. However, 15 regulators in addition to Canada did accord it. Finally,
the evidence shows that Airbus complained to a member of the party in power,
who referred the matter to the Minister of Transport. The Minister did not
ignore his colleague’s letter; the weight exemption was granted after senior
officials in the Department of Transport had been made aware of the
allegations. In addition, the file before the Court reveals that the Department
of Transport had been alerted and that it was not just junior officials who
were involved.
[28]
The file also shows that Department of Transport
officials were aware of the Airbus viewpoint and had been in contact with the
FAA and EASA. In an e-mail from the FAA to Transport Canada dated July 7, 2011,
the FAA noted its reservations, although Bell had not as yet made a request to
US authorities. On August 8, 2011, an e-mail from the EASA to Transport Canada
noted that the legal systems were different and that a decision to grant a
weight exemption could only be reached after an elaborate process. The e-mail
indicated a preference for harmonization among the three agencies (affidavit of
G. Leprince, Exhibit P-13).
[29]
The file also shows that not only was Bell given
weight exemptions by 15 other regulators, but that Airbus, which was clearly
aware of the application for exemption since the evidence establishes that it
was in communication with Transport Canada, did not request an exemption for
itself. Nor did it challenge in court the exemption given to Bell by Canadian
authorities, despite having informed Transport Canada of its opposition
(affidavit of G. Leprince, Exhibit P-13) and its opposition having been
received by Transport Canada. The weight exemption was granted on December 28,
2011.
[30]
This may explain why, at the hearing, Airbus
focused more on the appearance of cronyism that it contended was suggested by
some internal e-mails. We are not talking therefore of collusion, let alone
fraud; Airbus does not go further than to suggest bias. But then, this bias
would have occurred at the lower levels of the department. It therefore could
not explain the departmental decision that was reached despite formal
opposition from Airbus and the fact that the Minister himself had been made
aware of the complaints. These complaints had even led to a letter from an
assistant deputy minister of Transport Canada, on July 25, 2011, seeking to
reassure Airbus executives that the application for a weight exemption would be
handled in accordance with criteria established under the Aeronautics Act,
RSC 1985, c A-2. This same letter stated that “[i]t
should be noted that any other manufacturer of a comparable rotorcraft is
eligible to apply for a similar exemption” (affidavit of G. Leprince,
Exhibit P-13). As indicated above, Airbus did not take advantage of this
invitation.
[31]
The other evidence submitted by Airbus in
support of its contentions is the affidavit of Corey Taylor, a helicopter pilot
who undoubtedly has considerable experience in that field. He claimed to be
familiar with the limits of most helicopters certified in Canada and to be
knowledgeable about requests for proposals as he works for a company that
provides helicopter transport services. As was mentioned during the hearing,
Mr. Taylor does not have technical qualifications (his CV, which is
Exhibit N in his affidavit, indicates that he completed high school and
therefore has no particular aeronautics training), and his expertise, including
that relative to requests for proposals, is limited to the transportation of
goods and people, and not the procurement of helicopters. According to his CV,
he has spent his career as a pilot and manager (base manager, project manager,
operations manager, exploration manager, and at the time of the affidavit,
general manager of Great Slave Helicopters Ltd.)
[32]
Mr. Taylor sought to testify with regard to
the technical requirements in the request for proposals that could be tailored
to fit one aircraft in particular. That is in fact the conclusion that he
reached. To do this, he consulted flight manuals for different helicopter
models, among other documents.
[33]
At paragraph 24 of his affidavit, he states as
follows:
24. The requirements, that leave only the Bell 429 in
compliance, include:
(a) 6.4
– Minimum operating air temperature (EC135 and AW109 disqualified);
(b) 6.7
– Ditching standards (only the Bell 429 makes any claim to meeting ditching
standards from what I have been able to determine);
(c) 7.3.5.2.1
– 4 Axis Autopilot (EC135 eliminated);
(d) 7.3.5.5.1
– Cargo compartment size (EC135 and AW 109 disqualified); and
(e) 7.3.5.22.3
– Rear facing cargo doors (AW109 disqualified).
[34]
The affiant adds the following at paragraph 131
of his affidavit:
131. As a result of the way that they have been drafted, the
Technical Requirements have had the effect of excluding all aircraft other than
the Bell 429 from the competition, as follows:
(a) The
AW109 is eliminated because of non-compliance with items 6.4, 7.2.1 and 7.2.3,
although it gains 20 bonus points for 7.2.2;
(b) The
EC135 is eliminated because of non-compliance with items 7.1.2, 7.2.1 and 7.2.3,
but gains 50 bonus points for item 6.4 and 60 bonus points for item 7.2.2;
(c) The
MD902 is eliminated because of non-compliance with the Canadian IFR
certification and item 7.1.4.
We understand the affiant to be referring to
manufacturers’ helicopter models.
[35]
The applicant seeks to draw two arguments from
this evidence.
[36]
First, the Minister of PWGSC acted unlawfully in
that his action was arbitrary and unreasonable. It became clear during the
hearing that when the applicant spoke in terms of “excess of jurisdiction”, the
reference was to the exercise of discretion inherent in the granting of
contracts. Judicial review must be based on the standard of reasonableness in
this case. This contrasts with the standard of correctness, which applies to
true questions of jurisdiction, as set out in Dunsmuir v New Brunswick,
2008 SCC 9, [2008] 1 S.C.R. 190 [Dunsmuir], at paragraph 59 of the
decision:
[59] Administrative bodies must also be
correct in their determinations of true questions of jurisdiction or vires.
We mention true questions of vires to distance ourselves from the
extended definitions adopted before CUPE. It is important here to take a
robust view of jurisdiction. We neither wish nor intend to return to the
jurisdiction/preliminary question doctrine that plagued the jurisprudence in
this area for many years. “Jurisdiction” is intended in the narrow sense
of whether or not the tribunal had the authority to make the inquiry. In
other words, true jurisdiction questions arise where the tribunal must
explicitly determine whether its statutory grant of power gives it the
authority to decide a particular matter. The tribunal must interpret the grant
of authority correctly or its action will be found to be ultra vires or
to constitute a wrongful decline of jurisdiction: D. J. M. Brown and J. M.
Evans, Judicial Review of Administrative Action in Canada (loose‑leaf),
at pp. 14-3 to 14-6. An example may be found in United Taxi Drivers’
Fellowship of Southern Alberta v. Calgary (City), [2004] 1 S.C.R. 485, 2004
SCC 19. In that case, the issue was whether the City of Calgary was
authorized under the relevant municipal acts to enact bylaws limiting the
number of taxi plate licences (para 5, per Bastarache J.). That
case involved the decision-making powers of a municipality and exemplifies a
true question of jurisdiction or vires. These questions will be
narrow. We reiterate the caution of Dickson J. in CUPE that
reviewing judges must not brand as jurisdictional issues that are doubtfully
so.
[37]
It is clear to me that this is not at all what
the applicant is contending. Its argument is rather that the favouritism
demonstrated toward Bell is contrary to the law and government policies. A
customized request for proposals cannot be reasonable. It cannot satisfy the
law (section 40.1 of the Financial Administration Act, RSC 1985,
c F-11) or the regulations (Government Contracts Regulations, SOR/87-402).
Section 40.1 reads as follows:
Commitment
|
Engagement
|
40.1 The
Government of Canada is committed to taking appropriate measures to promote
fairness, openness and transparency in the bidding process for contracts with
Her Majesty for the performance of work, the supply of goods or the rendering
of services.
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40.1 Le gouvernement fédéral s’engage à prendre les mesures
indiquées pour favoriser l’équité, l’ouverture et la transparence du
processus d’appel d’offres en vue de la passation avec Sa Majesté de marchés
de fournitures, de marchés de services ou de marchés de travaux.
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A customized request for proposals would
also violate policies aimed at promoting healthy competition (Contracting
Policy) and meeting operational needs in a way that provides the best value
(Procurement Review Policy). The refusal to reconsider the technical
requirements would render the exercise of discretion unreasonable.
[38]
The other argument proceeds from an alleged
breach of procedural fairness. In this regard, the standard is less demanding
for an applicant because it is not that of reasonableness, but of correctness.
Here, the applicant challenges the decision to not change the technical
requirements on the grounds that it was not impartial. According to the
applicant, the criterion that should be applied is the appearance of bias:
would this give rise to a reasonable apprehension of bias on the part of a
well-informed person? Fairness, transparency and openness are required in the
awarding of public contracts.
[39]
Here, the applicant basically repeats the
elements of its first argument in contending that the Minister failed in his
duty to be impartial by favouring Bell and turning a deaf ear to the requests
of Airbus, and in not responding to repeated requests to provide additional
information on CCG mission profiles. The applicant pointed to the weight
exemption that was granted for the Bell helicopter as demonstrating favouritism,
as well as the technical requirements that Bell satisfied.
[40]
Moreover, the applicant argued that the Minister
violated the commitments that were made, and repeated, to act in the fairest
and most impartial manner. As proof of this, it points to the engagement
agreement that participants were required to enter into before the process
began. Indeed, the letter of interest (affidavit of G. Leprince, Exhibit P-2)
states as follows: [translation] “One of the fundamental principles of the industry consultation
is that it is conducted with the highest degree of fairness and equity among
all parties. No person or organization shall receive, or be perceived to
receive, any unusual or unfair advantage over the others.”
[41]
A second component of the breach of procedural
fairness would be related to the legitimate expectations of Airbus. Again,
there is a certain relationship with the first argument as to the
reasonableness of the discretion exercised in awarding the contract. On this
front, the applicant submits that it was entitled to expect that the request
for proposals would be [translation]
“biddable”, implying that the Minister should have taken into account the
comments and proposals Airbus had provided between August 2012 and April 2013,
and that the Minister would act with the utmost impartiality and as fairly as
possible. Airbus argues that it was disappointed in these legitimate
expectations.
[42]
The applicant therefore asks that the contract
that was awarded be cancelled due to a defective process, and that the Minister
establish a new process leading to a new request for proposals.
IV.
The defence
[43]
The respondents vigorously attacked the
allegations made in the application. The Attorney General, on behalf of the
Minister of PWGSC, as well as the other organizations that participated in the
procurement process for CCG helicopters, defended the process and sought to
demonstrate that the technical requirements criticized by Airbus were based on
operational requirements and were fair and reasonable. Bell, which won the
contract, fully supported the Crown and contended that the affidavit of
Mr. Taylor was not that of an expert, or at the very least, carried little
weight. Bell argued that if for some reason the Court agreed with Airbus, the
appropriate remedy would not be to cancel a contract on which the applicant did
not bid.
A.
The Crown
[44]
One of the respondents, the Crown, sought to
demonstrate that the structure established for the procurement of helicopters
ensured that the alleged bias was quite simply not possible; checks and
balances were incorporated into the process to guard against the type of
allegations being brought by Airbus in this case. The Crown met all of its
commitments, and the process that was implemented was of the highest integrity.
[45]
In addition, the Crown submitted evidence to
show that the technical requirements were necessary for the wide variety of
missions conducted by the CCG. Thus, the decisions being criticized by the
applicant to not reconsider and modify certain technical requirements in the request
for proposals were in fact reasonable and therefore unassailable.
[46]
As to the allegations that the process that was
followed violated procedural fairness, particularly because it interfered with
the applicant’s legitimate expectations, the Crown strongly defends what it
considers to be a model process. The process that was selected and used was
fair: it sought to involve industry well before the request for proposals was
issued on April 3, 2013. But it could not cause the Minister to refuse to
exercise the discretion required of him by law. Draft technical requirements
were provided to everyone, and meetings were organized with those who had
chosen to participate in the process following a 19-page letter sent out in
August 2012 to identify interested parties. Numerous changes were made to the
technical requirements to promote competition and not accidentally eliminate
potential bidders. These changes demonstrate the value and validity of the
rigorous process that was put in place and followed. The government was looking
for the best helicopter and did not wish to eliminate competition, which
promotes the best quality at the best price. On the contrary. But the product
had to meet the operational requirements.
[47]
The Attorney General argues that in no way did the
Minister of PWGSC have a closed mind regarding changes to the technical
requirements. The applicant would not be any more successful if the test to be
applied were the reasonable apprehension of bias since the evidence does not
show any such bias, in appearance or reality. The government promised a process
and followed it. This is what was done.
[48]
The applicant’s contentions are not supported by
any evidence, much less solid evidence. In fact, given the high number of
participants on the government side, the governance structure and the presence
of external parties to ensure a fair process, it would have taken serious fraud
on the part of all involved for there to be favouritism toward Bell. No such
evidence was tendered. The applicant was careful not to cross that line.
[49]
The governance structure put in place shortly
after the March 2012 budget remained in place at least until the request for
proposals was issued on April 3, 2013. The closing date for tenders was June 4,
2013.
[50]
At the heart of the governance was PWGSC, which
is legally responsible for managing the procurement process. While two other
organizations in particular had an interest in the matter, the Minister of
PWGSC was the minister responsible. Thus, the CCG had to determine its
operational requirements, which led to the technical requirements of the
aircraft to be procured. The Department of Transport provides the pilots and is
responsible for maintaining the helicopters. These organizations therefore
participated in the various committees established to ensure healthy
governance, but it was PWGSC that was primarily responsible for ensuring that
the process complied with the standards and the law.
[51]
Organization of the process leading to a request
for proposals in April 2013 began with the creation of a core team of experts
from the three departments. These project managers, members of the CCG and a
helicopter pilot (affidavit of R. Wight, para 33), directly supported PWGSC.
The core team was assisted by a users group that was established in June 2012
and had more than 20 participants (affidavit of R. Wight, para 32 and Exhibit
1). The result of multiple meetings held by these groups was the Preliminary
Draft CCG Helicopter Requirements Document—Light and Medium Helicopters,
Industry Day, September 2012, which was intended for use at the initial meeting
with helicopter manufacturers that followed a letter of interest issued by
PWGSC. As seen above, the letter was dated August 17, 2012.
[52]
This broad-based group was headed by a project
steering committee mandated to review and approve the technical requirements.
In the event that there was disagreement over the requirements, the issue would
be resolved by a committee composed of director generals, based on the
recommendations of the Project Steering Committee. Finally, the most difficult
and contentious issues were referred to a committee of assistant deputy
ministers (ADMs), the ADM Integrated Committee, whose membership was expanded
beyond the three key departments to include the Department of Industry, the
Treasury Board Secretariat and the Privy Council Office, the last two being
central agencies (affidavits of M. McNeil and R. Wight). There is evidence that
the ADM Integrated Committee insisted on the anonymity of the sources of
requests for changes to certain technical requirements.
[53]
Finally, PWGSC hired a consultant to serve as a
“fairness monitor”, while the CCG mandated an employee from the Ontario
Ministry of Natural Resources, pursuant to a memorandum of understanding (MOU),
to provide “an independent review of CCG’s technical
requirements for its Helicopter Project, and provide feedback to CCG regarding
the requirements”. The certification to be produced under the MOU was
that the requirements were the following:
• Reasonable
for the stated CCG missions and for commercial utility helicopters
• Achievable
by manufacturers of commercial utility helicopters
• Unbiased toward any particular
manufacturer(s)
[Affidavit of R. Crowell, Exhibit 2]
The agreement between the two ministries was
in place between October 1, 2012, and March 31, 2013. The services of
Mr. Crowell, the independent expert, were provided free of charge by the
Ontario Ministry of Natural Resources, except for expenses incurred in the
exercise of his mandate. In other words, Mr. Crowell did not receive any
remuneration from the CCG.
[54]
The Attorney General added that there was no
obligation to consult prior to issuing a request for proposals. However, the
choice to consult, with the support of a fairness monitor and an external
consultant who not only is himself a pilot, but also has specific knowledge
about the use to be made of such helicopters, along with a very elaborate
governance structure from working level to ADMs, could only serve to guarantee
the fairness and impartiality of the consultation. A very tight net was woven
to avoid accusations of collusion.
[55]
None of the Transport Canada officials involved
in the exercise leading to the weight exemption for the Bell helicopter (there
do not appear to have been other departments or organizations involved)
participated in the procurement process in question. Only the chief pilot, who
according to the June 17, 2010, e-mail, contacted an official of the Department
of Transport in December 2009, would have been a resource person involved with
the core group. He was, at most, one of the experts involved in the core group
and the users group. No one has suggested that he had any decision-making power
or control.
[56]
The governance system that was established was
both structured and rigorous. A remarkable quantity of minutes documenting the
work was submitted as evidence.
[57]
This governance structure was put in place for a
reason. It oversaw the consultations that the Minister had chosen to hold with
industry. Moreover, it was because of these consultations that the respondent
had an opportunity to be heard. It must be understood, however, that the
Minister did not abandon his discretion. The August 17, 2012, letter of
interest stated so bluntly in the “Terms and Conditions” section, as follows: “If Canada does release a RFP, the terms and conditions of
the RFP shall be at the sole discretion of Canada” (affidavit of M.
McNeil, Exhibit 6).
[58]
The consultation process was intended “to give industry information about the procurement for the
Helicopter Project and to obtain from industry the latest information on
helicopters, including their capabilities, limitations and available systems
and equipment” (affidavit of M. McNeil, para 28). Nowhere do we find
that the government was abandoning its management authority. It was going to
procure helicopters for purposes that it intended to determine. It had also
decided to procure helicopters that already existed, as opposed to having
helicopters built based on specifications to be determined.
[59]
Following the issuance of the letter of
interest, an Industry Day was held on September 4, 2012. The purpose was
to provide the information required for individual consultations. The first
round of individual consultations took place between September 4 and 6 and
involved meetings with 10 interested parties. The meeting with Airbus was held
on September 6, and was intended, as were the other consulting sessions, to
open a dialogue.
[60]
A second round of individual consultations was
held between November 15 and 19. A meeting with Airbus took place on November
15 and was attended by officials from the CCG, Transport Canada, PWGSC and
Industry Canada.
[61]
The period from November 19 to December 12,
2012, was spent reviewing the questions and comments raised during the
consultations in order to prepare a draft request for proposals, on which
additional individual consultations would be held.
[62]
Evidence was submitted demonstrating that
significant changes, requested by Airbus, were made and were reflected in the
draft request for proposals. The affidavit of M. McNeil, project manager at
PWGSC, indicates the following:
•
while initially the aircraft offered for sale
had to already be certified, it was agreed that certification of a new aircraft
could be acceptable up to six months after the bid closing date. As can be seen
in the letter that Airbus sent to PWGSC on December 20, 2012, Airbus was
insisting that consideration be given to a helicopter that was not yet
certified. On reading the letter, it seems clear to me that Airbus was seeking
an additional 12‑month period after the contract had been awarded. I note
that the documentary evidence shows that Airbus also complained that the
contract-granting process was proceeding too quickly (letter from Airbus to
PWGSC, January 11, 2013);
•
the autopilot that was originally requested was
amended to satisfy a request from Airbus;
•
the capacity to fold the helicopter blades so
the helicopters could be parked on CCG vessels was adjusted at the request of
Airbus. It appears that in the end, the adjustments were not satisfactory to
Airbus because for reasons of security, which were never challenged, there must
be a minimum amount of space on either side of the parked helicopter. The
Airbus suggestion to allow the blades to be removed from the helicopter so it
could be parked was rejected for technical and operational reasons. So, one of
the problem requirements for Airbus seems to have been that the helicopter
blades it could provide to satisfy the CCG could not fold enough to allow the
helicopters to be parked in hangars onboard CCG vessels. The waters on which
the CCG operates are not always calm, and it was determined that it was
necessary to have a place to park the helicopters onboard vessels. While the
hangar doors on the vessels are 4.08 metres wide, the blades on the Airbus
choppers only close to 3.8 metres, leaving clearance of no more than
14 centimetres on either side to move a piece of equipment weighing
several tons into this restricted space. In its letter of March 21, 2013,
Airbus offered to work with Transport Canada and the CCG “on solutions that would give them additional comfort with
this proposed width.” The response from PWGSC on April 4, 2013, which
also dealt with other Airbus complaints, quickly disposed of the question, as
demonstrated in the passage reproduced at paragraph 22 of these reasons
(affidavit of M. McNeil, paras 58 to 62).
[63]
The numerous changes that were made in response
to recommendations, comments and requests were compiled and presented as
evidence before this Court (affidavit of R. Wight, paras 77 to 82 and
Exhibits 4 to 7).
[64]
Three manufacturers continued with the
individual meetings in 2013. At the meeting on February 6, 2013, Airbus
made the usual speech (see para 16 of these reasons). The applicant declined
the offer to discuss the technical requirements. A final individual meeting was
held on March 4, 2013.
[65]
According to the respondent, at no time during
the individual sessions did Airbus present one of its helicopters; rather, it
simply claimed to have several helicopters that could be considered in response
to the requirements. The Crown contends that the applicant’s focus was on
attempting to redefine the mission profiles that had led to the operational
requirements. At paragraph 78 of his affidavit, M. McNeil says the following:
78. On many occasions, Eurocopter requested more detailed
information on the mission profiles which were used by the CCG to create the
technical requirements in the RFP. Based on communications with Eurocopter
representatives during the consultative process, it appeared that Eurocopter
wanted more details on the mission profiles so that they might redefine how the
CCG conducted its operations. The intent of providing mission profiles to
suppliers was not to give them an opportunity to dictate to the CCG how to conduct
its operations, but to provide them with some context for understanding the
basis for the technical requirements.
[66]
The request for proposals was completed and made
public on April 3, 2013. Mr. Crowell, the official from the Ontario
Ministry of Natural Resources, confirmed on March 12, 2013, that he had been
able to certify “that all the requirements referenced
in the Final Light Helicopter Baseline Requirements document dated February 28,
2013, are deemed Reasonable, for the stated missions and for commercial utility
helicopters; Achievable by manufacturers of commercial utility helicopters and
Unbiased toward and (sic) particular helicopter manufacturer(s)”
(Exhibit 12 in the affidavit of R. Crowell).
[67]
The Attorney General concludes by recognizing
that Airbus did not bid before the deadline. He comments that the impossibility
of parking the helicopters in the hangars onboard CCG vessels was basically a sine
qua non: [translation] “the helicopters are too wide” (memorandum of fact and
law, para 25).
[68]
The arguments of the Attorney General therefore
rest on the applicant’s failure to demonstrate that the technical requirements
are unreasonable due to arbitrariness. These requirements are based on
operational requirements identified by a range of experts in the field, and
monitored by a consultant who is not even paid by the CCG, further guaranteeing
his independence.
[69]
Several of the technical requirements identified
by the applicant were in fact amended (requirements 6.1(a), 7.3.5.2.1 and
7.2.13). In the final analysis, the purchaser of goods is entitled to determine
requirements. The Attorney General supports his argument with Almon
Equipment Limited v Canada (Attorney General), 2012 FCA 318, in which we
read the words of Mr. Justice Evans:
[11] We would only add that we agree
with the CITT that the fact that one bidder is better able than another to meet
the specifications of an RFP does not in itself necessarily mean that the
requirements of the RFP are biased in favour of that bidder. We also agree that
the purchaser of goods or services has the right to determine the requirements
needed for bidders to meet its legitimate operational requirements, subject to
the limits imposed by the applicable trade agreements to ensure fair
competition in public procurement.
[70]
The Attorney General adds that the evidence of
affiants Wight and Laughlin, on the contrary, demonstrate legitimacy. The
comments and observations of industry were carefully accepted, collected, and
considered before being decided on. They are in the file.
[71]
Procedural fairness was respected. The
respondent does not deny that procedural fairness must prevail even for
requests for proposals; however, the requirements are not as rigorous as for
other processes.
[72]
The Minister of PWGSC was under no obligation to
consult, and had complete discretion to determine the technical requirements
for the product being acquired. The Minister did have to respect the process he
had created and announced. The doctrine of legitimate expectation does not
guarantee a given result; it is procedural in nature.
[73]
In this case, the duty of impartiality was
fulfilled. According to the Attorney General, the Court should apply the closed
mind test. Given the considerable ministerial discretion, it is this more
stringent test that should apply. Furthermore, if the test for a reasonable
apprehension of bias is applied, the Minister still would have satisfied it.
Here again, the Attorney General cites a series of factors, ranging from the
governance structure, through the monitoring of the process and the changes
made to the technical requirements following the consultations the government
chose to hold, right up to the evidence that the technical requirements were
based on the operational requirements of the CCG.
[74]
As for the mission profiles that Airbus wanted,
the Attorney General notes that several were provided for purposes of
contextualizing the procurement exercise. What Airbus was trying to do was
interfere in the conduct of missions and the use the CCG would make of these
helicopters.
B.
Bell
[75]
Bell, the other respondent, adopts the viewpoint
that Airbus is a disappointed competitor: no particular decision is being
challenged. Airbus is complaining rather that some of the modifications to the
technical requirements were not accepted, which was in fact the prerogative of
the buyer, acting based on the operational requirements that it knew well.
[76]
Bell argues that one of the two affiants
presented by the applicant, Mr. Taylor, should not be characterized as an
expert; in any case, little weight should be accorded his testimony. Bell
submits that this witness is not independent because it was established on
cross-examination that not only is he paid, he is paid by the hour; he has a
stake in the outcome of this matter, which damages the quality of his evidence.
He is a helicopter pilot in the private sector who has never been involved in a
helicopter procurement process (he has participated in service procurement
processes, but these are very different and much less complex).
[77]
In addition, doubt is cast on numerous
statements that were contradicted by the respondents’ witnesses. With regard in
particular to a technical table pertaining to HOGE (hovers-out of ground
effect), the applicant did indeed concede its error. Bell adds that
Mr. Taylor was wrong to assert that the Bell 429 can only use a certain
type of fuel at low temperatures and cannot take off from certain helipads. If
Mr. Taylor’s testimony is not set aside completely, at the very least it
should not be given much weight.
[78]
Respondent Bell also notes that Exhibit P-46
from affiant G. Leprince of Airbus is far from convincing. Not only were nine
technical requirements misinterpreted by incorrectly ascribing to them colours
they didn’t deserve, but several boxes were not ascribed any colour at all.
Bell recommends that no weight be given to such evidence, which is ultimately
nothing more than patchwork.
[79]
Bell argues that Airbus is not owed any duty of
fairness in a procurement process and that section 40.1 of the Financial
Administration Act, cited by Airbus, does not create such a statutory duty
(Irving Shipbuilding Inc v Canada (Attorney General), 2009 FCA 116, 314 DLR (4th) 340).
[80]
In any event, the process was impartial, whether
the test used is the one of closed mind or the reasonable apprehension of bias.
Suspicion is never enough. The proof was lacking; the allegations were
high-sounding, but the evidence was non-existent.
[81]
Although Bell recognizes the existence of the
doctrine of legitimate expectations, the latter merely requires that the
administration respect the promises made in terms of procedure; it never
applies to the substantive outcome. Airbus is arguing that it should have been
entitled to changes in the technical requirements. The process that was
followed corresponded in all respects to the promises made before it was begun.
[82]
Finally, both Bell and the Attorney General are
asking the Court to refuse to grant the requested remedy, i.e., cancellation of
the contract, in the event that Airbus should be successful.
V.
Analysis
[83]
In my opinion, the weight of the evidence in
this matter amply favours the respondents. The applicant, Airbus, has not
satisfied the Court that procedural fairness was violated or that the refusal
to reconsider and modify certain technical requirements in the request for proposals
constituted an unreasonable exercise of the authority conferred on the Minister
of PWGSC.
A.
The legal framework
[84]
It is worth remembering from the outset that the
law confers discretion on the Minister in performing his duties. Section 7
of the Department of Public Works and Government Services Act, SC 1996,
c 16, establishes the functions for which the Minister is responsible.
Section 20 deals specifically with contracts on behalf of the Government
of Canada. The scope of the discretion is found in section 21, which reads
as follows:
Terms and conditions
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Modalités
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21. (1) The Minister may fix terms and conditions of contracts,
and instructions and terms and conditions with respect to other documents
relating to contracts and their formation.
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21. (1) Le ministre peut fixer les modalités des marchés et les
directives et modalités des documents qui se rapportent aux marchés ou à leur
passation.
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Designation
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Désignation par numéro
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(2) The terms and conditions and instructions may be identified by
number or other designation and may be incorporated in a contract or other
document by reference to their number or other designation.
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(2) Les modalités et directives peuvent être désignées par un
numéro ou d’une autre façon et être incorporées dans les marchés et documents
en y étant signalées par ce numéro ou selon l’autre façon.
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Publication
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Règlements
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(3) The Minister may, by regulation, prescribe the electronic or
other means by which a term, condition or instruction, including its
identification number or other designation, shall be published.
|
(3) Le ministre peut, par règlement, prévoir la manière de
publier, notamment par voie électronique, les modalités et directives
relatives aux marchés ou à leur passation, y compris leur désignation par un
numéro ou d’une autre façon.
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[85]
This is why the Minister is a key part of the
process to procure helicopters on behalf of the CCG, and why he holds the
balance of power. He is accountable to his administration:
Exercise of powers, etc.
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Fonctions
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7. (1) In exercising the powers or performing the duties or
functions assigned to the Minister under this or any other Act of Parliament,
the Minister shall
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7. (1) Dans le cadre des pouvoirs et fonctions que lui confère la
présente loi ou toute autre loi, le ministre :
|
[…]
|
[…]
|
(b) acquire materiel and services in accordance with any
applicable regulations relating to government contracts;
|
b) acquiert du matériel et des services, en conformité avec les
règlements pertinents sur les marchés de l’État;
|
(c) plan and organize the provision of materiel and related
services to departments including the preparation of specifications and
standards, the cataloguing of materiel, the determination of aggregate
requirements for materiel, the assuring of quality of materiel, and the
maintenance, distribution, storage and disposal of materiel and other
activities associated with the management of materiel; and
|
c) planifie et organise la fourniture aux ministères de matériel
et de services connexes tels l’établissement de normes générales et particulières,
le catalogage, la détermination des caractéristiques globales du matériel et
le contrôle de sa qualité, ainsi que la gestion de celui-ci et les activités
qui en découlent, notamment son entretien, sa distribution, son entreposage
et sa destination;
|
…
|
[…]
|
It flows from that, it seems to me, that if
there were collusion or bias in favour of one or other of the companies invited
to participate in the bidding process, it would have occurred among the most
senior people responsible. This alleged bias would have to benefit the CCG or
the Department of Transport, but in a way that is unknown to us. Yet it was
PWGSC which managed the process, which had to be fair. It was that department’s
responsibility. Section 40.1 of the Financial Administration Act, although
declaratory, is nevertheless a strong affirmation on the part of Parliament
that the federal government must take “appropriate
measures to promote fairness, openness and transparency in the bidding process
for contracts”. As we have just seen, this task falls first and foremost
to the Minister of PWGSC. The evidence shows that it was PWGSC that managed the
process and was the main contact for the applicant.
[86]
But the exercise of discretion can never be
arbitrary. As we have just seen, the Minister must respect the Government
Contracts Regulations, which require the following:
5. Before any contract is entered into, the contracting authority
shall solicit bids therefore in the manner prescribed by section 7.
|
5. Avant la conclusion d’un marché, l’autorité contractante doit
lancer un appel d’offres de la façon prévue à l’article 7.
|
Nowhere is there mention of an obligation to
consult beforehand. That is an obligation that PWGSC chose to place on itself.
It then had to follow the rules it had established for itself and announced to
the participants.
B.
Access to remedy on judicial review
[87]
In this case, Airbus did not respond to the
request for proposals. It chose not to continue in the process that began with
the August 17, 2012, letter of interest and concluded with the April 3,
2013, request for proposals, which it considered to be fatally flawed. It
therefore could not seek a remedy in contract law (Irving Shipbuilding Inc v
Canada (Attorney General), 2009 FCA 116, [2010] 2 FCR 488 [Irving
Shipbuilding Inc.]). The question is therefore whether judicial review is
available to the applicant.
[88]
The Attorney General concedes that the action
undertaken by the applicant is viable. The other respondent, Bell, merely
states that it is an issue for the Court to resolve. Obviously, jurisdiction
cannot be given by consent. However, I am of the opinion that judicial review
is a possibility under the circumstances because the Minister chose to hold a
consultation process before launching the request for proposals. This choice
prevents him from acting arbitrarily, which in turn, requires that judicial
review of the exercise of discretion be available.
[89]
Although pronounced in a completely different
context, the words of Mr. Justice Montigny in Canadian World Wide Film
Festival v Telefilm Canada, 2005 FC 1730, support my opinion:
[27] The respondent submitted that the
applicant was not directly affected by the decisions of September 7 and
December 17, 2004 as it refrained from participating in the bidding process.
Therefore, it could not file an application for judicial review since it did
not meet the requirements of subsection 18.1(1) of the Federal Courts
Act.
[28] The applicant replied that it had
the required standing inasmuch as it risked having to face competition making use
of the grant which the WFF would then no longer have. The reason why it did not
participate in the bidding process was that it felt that the dice were loaded
and that the sole purpose of the process started by Telefilm was to exclude it
from the organization and presentation of a film festival in Montréal.
[29] In view of the increasingly broad
interpretation given to the notion of standing by the courts in the past few
years, and the ongoing involvement by the WFF in the international film world
in Montréal since 1977, as well as of the impact which the disputed Telefilm
decisions could not fail to have on the activities, participation and even
existence of the WFF, I have no difficulty in ruling that the applicant has
sufficient legal standing to apply for judicial review of the bidding process
and of the selection of a competing organization by Telefilm at the conclusion
of that process. Although Prothonotary Morneau did not give reasons for his
decision to deny the motion to strike made by the respondent, this Court has no
reason to think that he erred in his interpretation of the facts or in applying
the principles developed by the courts in this area.
The ball had already been set in motion in Gestion
complexe Cousineau v Canada (Minister of Public Works), [1995] 2 FC 694 [Gestion
complexe Cousineau], where Mr. Justice Décary, writing for the Federal
Court of Appeal, stated as follows:
[10] With respect, that would be to
take an outmoded view of supervision of the operations of government. The
“legality” of acts done by the government, which is the very subject of
judicial review, does not depend solely on whether such acts comply with the
stated requirements of legislation and regulations. For example, when the
Minister makes a call for tenders he is establishing a procedural framework
which brings into play the principle of reasonable or legitimate expectation
recognized by this Court in Bendahmane v. Canada (Minister of Employment and
Immigration) [1989] 3 F.C. 16 (C.A.). See also Pulp, Paper and Woodworkers
of Canada, Local 8 v. Canada (Minister of Agriculture) (1994), 174 N.R. 37
(F.C.A.). The unsuccessful bidder thus has the right to ask the Court, by an
application for judicial review, to compel the Minister to observe commitments
made by him as to the procedure he intended to follow, regardless of whether
the Minister acted on his own initiative or in compliance with regulations.
Paragraphs 17 and 18 of that decision are
also important:
[17] I cannot conceal the hesitation I
would have had in categorically stating that in no circumstances could the
Federal Court by way of judicial review determine the legality of a tender
proceeding, as essentially that is what is meant when it is argued that the
Court does not have jurisdiction. It is one thing to say that a remedy is more
or less appropriate depending on the circumstances; it is another to say that a
remedy is systematically prohibited in all circumstances. It seems to me that
the respondents have confused these two ideas. It may be that in reality they
will more often than not be right in that the courts will seek in vain for the
illegality which alone could justify intervention. The fact remains that under
the language conferring jurisdiction on the Court, Parliament authorized
challenges to such decisions and the fact that in practice they will seldom be
successfully challenged does not mean that the Court lacks jurisdiction over
them.
[18] In the case at bar we need only
assume that the appellant was able to prove the allegations of collusion between
the Crown and the mis en cause which were originally its principal
ground of challenge (and which it withdrew during the course of its action).
Would the Court not then have had jurisdiction in hearing an application for
judicial review to quash the disputed actions on the ground of fraud mentioned
in paragraph 18.1(4)(e) [as enacted by S.C. 1990, c. 8, s. 5] of the Federal
Court Act? Additionally, what is the position of a third party who in view
of the collusion refrained from making a bid and which because it did not do so
was not a “contracting party” within the meaning of Ron Engineering?
Could it be compelled to take its chance in a delictual action against the
Crown? And what should be said of the fraudulent act which would be beyond the
scope of any judicial review, including in this Court an application for a
declaratory judgment, and could never be quashed?
[90]
It is clear, however, that when a party chooses
to request a judicial review of a request for proposals, it must live with the
constraints of the chosen remedy. But the remedy does exist, as we read in Irving
Shipbuilding Inc, cited above, at paragraph 21:
[21] The fact that the power of the
Minister, a public official, to award the contract is statutory, and that this
large contract for the maintenance and servicing of the Canadian Navy’s
submarines is a matter of public interest, indicate that it can be the subject
of an application for judicial review under section 18.1, a public law
proceeding to challenge the exercise of public power. However, the fact that
the Minister’s broad statutory power is a delegation of the contractual
capacity of the Crown as a corporation sole, and that its exercise by the
Minister involves considerable discretion and is governed in large part by the
private law of contract, may limit the circumstances in which the Court should
grant relief on an application for judicial review challenging the legality of
the award of a contract.
Clearly, there is more case law dealing with
situations where bids were actually submitted. The decision in Cougar
Aviation Ltd v Canada (Minister of Public Works and Government Services), 2000
CanLII 16572, 264 NR 49 [Cougar], dealt with the evaluation of
submissions. Nevertheless, it appears to me that the consideration set out at
paragraph 37 is just as relevant in our case, where the Minister chose to
consult within a very precise framework:
[37] Second, the application of the
more stringent test advances the objectives of the Agreement, in view of the
importance of the transparency and fairness of the process, and the avoidance
of “pork-barrelling” in the award of procurement contracts. If potential
bidders lack confidence in the integrity of the way in which government
contracts are awarded, they may be discouraged from submitting a bid, to the
detriment of the public interest in obtaining the best value for money, and in
ensuring that the competition is truly open to all.
In my opinion, what is important is that a
process leading to a request for proposals was established. In this case, there
was this public element in the awarding of the contract, even in the
preliminary stage. The Minister cannot act arbitrarily. But this will be a very
high bar for an applicant to try to jump. The Minister must ensure procedural
fairness, however limited it may be, and must use his discretion reasonably.
These are the parameters to which the applicant must submit.
[91]
In this case, it is not easy to identify the
decision that would be subject to judicial review. The applicant refers to a
refusal to reconsider and modify the technical requirements. The respondents
appear to be satisfied with that characterization. Fine. No one doubts that
fairness, transparency, equal opportunity and competition should be part of the
contract awarding process. The same goes for the preliminary process leading to
the eventual request for proposals itself. But there is no less a burden on the
applicant, and that is to demonstrate that the refusal to consider the changes
was unreasonable. In that same vein, it must also demonstrate that the refusal
to make the changes was unreasonable.
[92]
In these matters, Supreme Court of Canada case
law has determined what is involved in the standard of reasonableness.
Deference is required. The now famous paragraph 47 of Dunsmuir, cited
above, deserves to be reproduced in full:
[47] Reasonableness is a deferential
standard animated by the principle that underlies the development of the two
previous standards of reasonableness: certain questions that come before
administrative tribunals do not lend themselves to one specific, particular
result. Instead, they may give rise to a number of possible, reasonable
conclusions. Tribunals have a margin of appreciation within the range of
acceptable and rational solutions. A court conducting a review for reasonableness
inquires into the qualities that make a decision reasonable, referring both to
the process of articulating the reasons and to outcomes. In judicial
review, reasonableness is concerned mostly with the existence of justification,
transparency and intelligibility within the decision-making process. But
it is also concerned with whether the decision falls within a range of
possible, acceptable outcomes which are defensible in respect of the facts and
law.
Thus, the standard of reasonableness is rooted
in the concept of deference, which “therefore implies
that courts will give due consideration to the determinations of decision
makers” (Dunsmuir, at para 49). If the decision is justified and
transparent and results from an intelligible decision-making process, it will
be reasonable; if the decisions are among the possible and acceptable outcomes,
the decision will be reasonable. The reviewing Court does not replace the
decision maker. The onus is on the applicant to satisfy the Court. The Supreme
Court stated as follows at paragraph 49:
In short, deference requires respect for the
legislative choices to leave some matters in the hands of administrative
decision makers, for the processes and determinations that draw on particular
expertise and experiences, and for the different roles of the courts and
administrative bodies within the Canadian constitutional system.
C.
Is the decision reasonable?
[93]
Here, the evidence presented in support of the
application does not meet the burden. With respect, I could not find in the
evidence how the process followed could have been faked or arbitrary. In my
opinion, the alleged favouritism was never demonstrated.
[94]
The Crown presented very strong evidence of a
transparent and intelligible process run by the Minister of PWGSC, who had no
interest in the matter other than to conduct a request-for-proposals process
that satisfied the commitment set out in section 40.1 of the Financial
Administration Act. The governance structure, the participation of a number
of people and experts, the involvement of several departments and the use of an
independent expert (who was not even paid by the CCG) all argue in favour of a
framework that provided for reasonable decisions in terms of administrative
law. Indeed, the evidence shows that nearly 25 recommendations, some
favourable to Airbus, were accepted and resulted in amendments to the technical
requirements. We are far from the applicant’s allegation that the Minister
refused to reconsider the technical requirements. This is quite simply not the
case. The Minister refused to make some of the changes that were requested.
That is not the same thing.
[95]
The evidence before this Court is clear. A
rigorous process was put in place, with close monitoring of the recommendations
and requests made and the reasons for their acceptance or rejection. Everything
seems to have been documented. One might think that the giver of work was
seeking to guard against possible attacks. A process was therefore created that
had abundant checks and balances. A process designed to counter potential
attacks cannot be all things: it is not impossible that despite the process,
there were flaws. But again, they must be demonstrated. Insinuations are not
sufficient.
[96]
Robert Wight, who is a mechanical engineer and
an MBA, is the director general at the CCG responsible for several procurement
projects exceeding $4 billion. He testified about the process established
in this case, with overlapping committees to oversee the exercise (Project
Steering Committee, Director General Governance Committee, ADM Integrated
Steering Committee).
[97]
His testimony, which was given by affidavit and
on which he was cross-examined, is particularly relevant with regard to the
development of the technical requirements criticized by the applicant.
[98]
The least that can be said is that this element
of the procurement process is particularly well documented. Of particular
interest are the tables, each more than 45 pages in length, which became
Exhibits 6 and 7 in Mr. Wight’s affidavit.
[99]
These tables list all the mandatory
requirements. Exhibit 6 shows the evolution of each requirement, starting with
the initial requirements, through the draft request for proposals and on to the
final request for proposals. All of the changes are explained. Exhibit 7
provides the reader with the justification for the technical requirement as it
related to the operational requirement.
[100] It would seem to me impossible to conclude arbitrariness on reading
these tables. At the very least, the applicant’s evidence did not demonstrate
this, let alone convincingly. Moreover, there is transparency. The changes are
recorded, and they are many, and they are justified based on operational
requirements. The evidence is abundant and it was not disputed. One can even
find in Exhibit 5 to Mr. Wight’s affidavit a copy of the requests for
proposed changes, running to more than 200 pages.
[101] As if the tables were not sufficient, Mr. Wight explains in his
affidavit the rationale for denying some of the changes requested by Airbus. In
my opinion, this evidence is overwhelming. In fact, it was not disputed, and
the cross-examination of Mr. Wight did nothing to weaken or undermine the
tables.
[102] That the applicant was disappointed that some of its recommendations
were not adopted is all very well. But that certainly does not make the
decisions unreasonable. In fact, I was not convinced that the technical
requirements were not based on CCG operational requirements. Quite the
opposite. The applicant’s evidence was sorely lacking on this front. This
evidence comes down to allegations of bias that never reached the point of
demonstrating that the operational requirements were exaggerated. From the
outset, Airbus saw that the technical requirements were high and chose instead
to address the mission profiles. If these did not match the operational
requirements, then the claim could be made that the technical requirements
exceeded actual requirements. Unfortunately for the applicant, this was not
proved, and it is not possible to draw inferences of this nature from unsupported
allegations.
[103] There was little in the way of evidence from the applicant’s
witness, Mr. Taylor. As an experienced helicopter pilot who has always
worked in the private sector, his expertise was limited in that he had no
experience with requests for proposals for the procurement of helicopters.
Without rejecting his testimony outright, it counted for little in the face of
the solid evidence presented by the Crown. As John Sopinka wrote in 1981 in his
The Trial of an Action (John Sopinka, The Trial of an Action,
(Toronto: Butterworths, 1981)):
It is usually vain to suppose that the
expert will be wholly discredited. The object is to flaw him so that your
expert is preferred.
[Page 80]
[104] As noted above, Mr. Taylor’s expertise is limited and the
applicant admitted that he had misunderstood the technical table regarding
HOGE. I also recall the questions relating to the use of certain fuels at very
low temperatures, where the testimony seemed far from persuasive. This affected
the relative weight.
[105] The applicant did not really focus on specific aspects of the
technical requirements. When it did so early in the process, adjustments were
made that favoured Airbus, at least in part. When, at the very end of the
process, the focus was on the vital points of payload, range of the aircraft—in
terms of both distance traveled and desired altitude—or blade folding, the
changes sought by Airbus were considerable and would have significantly
diminished the technical requirements. Airbus was promoting less versatility
and inferior performance.
[106] Airbus sought instead to focus the debate on two key points: that
the government showed favouritism, beginning with its decision to grant a
weight exemption for the Bell helicopter; and that it refused to provide the
mission profiles, which would have allowed for suggesting alternatives rather
than challenging the technical requirements.
[107] In terms of the weight exemption, the applicant sees this as
evidence of favouritism by the government. It seems to me that there is here an
element of verbal inflation. Even if there were an admission that the CCG chief
pilot had indicated in December 2009 that the Bell 429 would be a good
candidate for the CCG, which he claims not to remember, he cannot speak for the
Government of Canada. The weight exemption was not granted by the chief pilot.
[108] The Attorney General argued that if Airbus wanted to challenge the
weight exemption, it should have done so at the time it was granted. I
concluded that there is nothing improper in raising the context that led to the
exemption because it is part of the overall story. Airbus is not challenging
the exemption on technical merits, but rather as evidence of favouritism. But
again, that must be proven.
[109] The evidence shows that the complaints on this matter did reach the
Minister of Transport. There is evidence that 15 other regulators accorded the
exemption to this aircraft, that Airbus could have taken advantage of it (it is
difficult to see how Airbus could have been refused if it was permitted by the
specifications of other crafts) and that the decision was made at the highest
level. The allegations of cronyism at the lower levels were not proved, and
even if they had been, the collusion would have to have been very extensive in
order to lead to the conclusion that the Government of Canada had unduly
favoured Bell. The circumstantial evidence, consisting more of allusions than
facts, does not allow such an inference. And that is not what Airbus has
alleged. Its allegation of cronyism is baseless and leads nowhere. This certainly
does not show collusion or even favouritism.
[110] As for the mission profiles, Airbus requested more information about
them very early in the process, despite the fact that seven mission profiles
had been provided to the participants in the process. It is far from clear what
constituted possible alternatives, other than altering the requirements by
reducing them in terms of helicopter performance. For some requirements, the
proposed alternative was to reduce the payload by nearly 9%, or have maximum
flight times lowered by 8.3%. For blades that could not be folded back to park
the helicopter, the first alternative was to remove them; in March 2013, there
was nothing more than an offer to work with the CCG to find a solution. Here
again, there was a lack of precision in the applicant’s evidence.
[111] There is more however. It became apparent early in 2013 that the
mantra about the mission profiles went beyond the profiles. In its letters of
January 11 and March 18, 2013, Airbus was no longer seeking mission profiles. I
reproduced identical passages from the two letters at paragraph 19 of these
reasons. When the questions turn to the number of bases, the number of vessels,
the length of night missions, the distance from ship to shore for each mission,
the percentage of usage of each type of helicopter for each mission per year
and the description and quantity of loads for each mission, one can conclude
that we have moved away from mission profiles in an effort to find
alternatives. This looks much more like interference in the conduct of CCG
operations. What could possibly explain the relevance of the number of bases or
vessels? I cannot see how a refusal to submit to this type of questioning could
in any way be considered unreasonable. It was not so much the mission profile
being requested, but the profile of use for the helicopters. Not only did the
Minister not have an obligation to provide mission profiles, but he actually
had done so in order to provide context. He certainly did not have an
obligation to provide the use of the helicopters and their frequency of use
under different circumstances. That seems to me to be a different matter
altogether.
[112] The evidence also suggests that Airbus did not have a
latest-generation helicopter. While the original requirements indicated that
bids would only be accepted on helicopters that were already certified, at the
request of Airbus, that requirement was changed so that certification had to be
obtained within six months of the bid closing date. The Crown presented
evidence to the effect that the applicant has never disclosed which helicopter
would have been the subject of a bid. In January 2013, Airbus complained that
the consultation process was going too fast. I think that a reasonable
inference can be drawn that as early as August 2012, the applicant knew that
its helicopters would be incapable of meeting the technical requirements, but
that another helicopter could be more competitive. This would explain the
request to allow a helicopter to be certified after bid closing and the
insistence that the bidding process was moving too quickly.
[113] In any case, if the applicant could argue that the type of use was
exaggerated, this might have led to reduced technical requirements that would
have made it more competitive. However, the technical requirements were neither
unfair, nor unreasonable, nor arbitrary according to the evidence before the
Court. Airbus has never demonstrated that the technical requirements exceeded
the identified operational requirements. This is consistent with the findings
of the independent expert, whose conclusions were not seriously questioned,
that these requirements are “reasonable, achievable and
fair.” The applicant did not demonstrate that the Minister was
unreasonable in refusing to reconsider and modify the technical requirements.
Rather, the file points to a systematic review of technical needs, and this is
backed by abundant documentation submitted as evidence. Nor was it proven that
the request for proposals was tailored so as to favour Bell, since the process
followed and its elaborate governance produced reasonable, achievable and fair
requirements, according to an independent expert.
D.
Procedural fairness: impartiality
[114] The other component of the judicial review is the contention that
there was a breach of procedural fairness. The standard of review in this area
is that of the correct decision (see, among others, Dunsmuir, above, Mr.
Justice Binnie at para 129). No deference is normally owed.
[115] Brown and Evans, in their Judicial Review of Administrative Action
in Canada (Brown and Evans, Judicial Review of Administrative Action in
Canada (Toronto, ON: Carswell, 2013) (loose-leafs updated 2014-3), ch. 7,
1610) present the question as follows:
Apart from a
legislated standard, courts have generally assumed that questions of
administrative procedural propriety are peculiarly within their province, at
least when they are determining whether an administrative agency’s procedure
was unfair, and accordingly they rarely apply a deferential standard of review.
Others have reached the same conclusion on the basis that since both the
existence of and the content of the duty of fairness raise questions of law,
the standard of review of correctness.
There would appear
to be two bases for the court’s present non-deferential approach. First, as
indicated, courts have traditionally regarded themselves as having an expertise
in matters of procedure, and in particular, in the conduct of fair hearings in
connection with adjudicative decision-making. Second, when the legislature endows
an administrative tribunal with a dispute resolution function, and in effect
takes it out of the judicial system, the courts can provide some protection to
individuals against abuses of power and arbitrary decision-making, by requiring
the tribunal to follow a fair procedure.
[116] But this does not resolve the issue. The case law is clear that the
quality of procedural fairness should vary with the context, the circumstances.
Thus, in Baker v Canada (Minister of Citizenship and Immigration),
[1999] 2 S.C.R. 817, the Court developed a framework of analysis for determining
the applicable standard. The various elements were helpfully summarized in Congrégation
des témoins de Jéhovah de St-Jérôme-Lafontaine v Lafontaine (Village), 2004
CSC 48, [2004] 2 S.C.R. 650, at paragraph 5:
5 The content of the duty of
fairness on a public body varies according to five factors: (1) the nature
of the decision and the decision-making process employed by the public organ;
(2) the nature of the statutory scheme and the precise statutory provisions
pursuant to which the public body operates; (3) the importance of the decision
to the individuals affected; (4) the legitimate expectations of the party
challenging the decision; and (5) the nature of the deference accorded to the
body: Baker v. Canada (Minister of Citizenship and Immigration), [1999]
2 S.C.R. 817. In my view and having regard to the facts and legislation in
this appeal, these considerations require the Municipality to articulate
reasons for refusing the Congregation’s second and third rezoning applications.
Generally speaking, if one were to place the
guarantees of procedural fairness along a spectrum, they would be significantly
more elaborate where fundamental human rights are being adjudicated, with the
other end of the spectrum being occupied by cases in which commercial interests
are at play. Here, the discretion conferred on the Minister is considerable.
There is no dispute on that front. The consultation that was held was by
choice, with no legal obligation. There is no doubt that the Minister must act
impartially and in good faith. But this was not an adjudication or a process
that can be likened to the quasi-judicial function. In any case, I believe the
process followed by PWGSC is irreproachable in terms of procedural fairness.
There is no need to elaborate further on the analysis framework, given that in
my opinion, PWGSC met its duty of impartiality and procedural fairness in that
all participants in the process were treated equally.
[117] This argument overlaps in large measure the first. The applicant
argued that the Minister failed in his duty of impartiality, which without a
doubt falls under minimal procedural fairness. Based on the abovementioned
decision in Cougar, the applicant argues that the applicable test was
that of reasonable apprehension of bias. Cougar states as follows:
[35] It is not necessary to decide here
whether the duty of fairness, as it applies to Appeal Boards, includes a
reasonable apprehension of bias. However, in my opinion it is entirely compatible
with the legal framework regulating the award of this procurement contract to
require that those evaluating the bids must avoid conduct that gives rise to a
reasonable apprehension that they were biased in favour of one bidder.
[36] I base this view on two grounds.
First, the award of a contract governed by the Agreement is not essentially a
policy-based decision to which it might be appropriate to apply the less
stringent test of the appearance of a closed mind. The decision-making process
for the award of procurement contracts involves the weighing of competing bids
by reference to relatively objective criteria, as well as to a more subjective
assessment of the suitability of the bidders as potential service providers,
especially when, as here, they will be in an ongoing relationship with
officials from the DFO during the performance of the contract.
[37] Second, the application of the
more stringent test advances the objectives of the Agreement, in view of the
importance of the transparency and fairness of the process, and the avoidance
of “pork-barrelling” in the award of procurement contracts. If potential
bidders lack confidence in the integrity of the way in which government
contracts are awarded, they may be discouraged from submitting a bid, to the
detriment of the public interest in obtaining the best value for money, and in
ensuring that the competition is truly open to all.
We see that the Federal Court of Appeal does
not formally rule on the issue, but seems to tend in that direction. However, the
Attorney General argues that the test should in fact be the appearance of a
closed mind, relying in this on another decision of the Federal Court of
Appeal, in Pelletier v Canada (Attorney General), 2008 FCA 1 [Pelletier].
[118] Neither of these decisions is entirely consistent with our business:
Cougar dealt with bias in the evaluation of bids, which is different
from the process, not required by law, leading up to the request for proposals.
Pelletier considered the dismissal of a person appointed by the Governor-in-Council
at pleasure. Our case involves a non-obligatory process prior to a request for
proposals.
[119] Given the conclusion reached by the Court, it is not necessary to
select a higher test, such as the close-minded person, because in my opinion
there could be no reasonable apprehension of bias on the part of an informed
observer looking at the matter realistically and practically (the test as
presented in Med-Emerg International Inc v Canada (Public Works and
Government Services), 2006 FCA 147, at para 31, repeating the now famous
test articulated in Committee for Justice and Liberty v The National Energy
Board, [1978] 1 S.C.R. 369).
[120] Essentially, the applicant repeats its argument with regard to the
reasonableness of the refusal to modify the technical requirements, and now
contends that there was a lack of impartiality. The applicant argues the
following:
•
the technical requirements were modeled on the
specifications of the Bell helicopter;
•
the applicant’s interventions exposing the
discrimination it had suffered remained unanswered;
•
the Minister wanted to prevent Airbus from
offering alternatives by not providing enough information about the mission
profiles;
•
certain technical requirements were modified to
favour Bell;
•
the government already favoured Bell given that
it accorded a weight exemption that was refused by the relevant US and European
authorities.
[121] As I have attempted to show, these complaints do not hold water and
in any event, the weight of the respondents’ evidence is much greater. The
governance structure, the large number of officials at different levels who
were part of the consultation process, the presence of a fairness monitor to
ensure that the participants were treated equally and that the same information
was available to everyone, the fact that numerous changes were made, including
several in favour of Airbus, and the firm opinion of an independent expert that
the technical requirements were reasonable, achievable and fair, all favour the
respondents. I add that I am satisfied with the evidence presented to the
effect that the technical requirements are intended to address the CCG’s
operational requirements. As mentioned earlier, the episode of the weight
exemption, which did not involve any of the people involved in the helicopter
procurement process, with the exception of the CCG chief pilot, and the issue
of mission profiles, do not advance the cause of the applicant. We cannot see a
breach of impartiality in refusing to accept interference, even when disguised,
in CCG operations. The consultation process did not go that far. The informed
observer examining the facts realistically and practically would clearly
recognize the quality of the process put in place, which eliminates the
reasonable perception of bias.
E.
Procedural fairness: legitimate expectations
[122] Finally, the applicant alleged a breach of its legitimate
expectations. I agree for the purposes of this case that the doctrine of
legitimate expectations operates (Gestion complexe Cousineau, cited
above, paragraph 10). But this doctrine is of a procedural nature; the
applicant was entitled to expect that the procedure initiated by the Minister
to consult, even if it was not required, would be followed. In Canada
(Attorney General) v Mavi, 2011 SCC 30, [2011] 2 S.C.R. 504 [Mavi], the
doctrine of legitimate expectations is described as follows:
[68] Where a government official makes
representations within the scope of his or her authority to an individual about
an administrative process that the government will follow, and the
representations said to give rise to the legitimate expectations are clear,
unambiguous and unqualified, the government may be held to its word, provided
the representations are procedural in nature and do not conflict with the
decision maker’s statutory duty. Proof of reliance is not a
requisite. See Mount Sinai Hospital Center, at paras. 29-30; Moreau-Bérubé
v. New Brunswick (Judicial Council), 2002 SCC 11, [2002] 1 S.C.R. 249, at
para. 78; and C.U.P.E. v. Ontario (Minister of Labour), 2003 SCC 29,
[2003] 1 S.C.R. 539, at para. 131. It will be a breach of the duty of
fairness for the decision maker to fail in a substantial way to live up to its
undertaking: Brown and Evans, at pp. 7-25 and 7-26.
However, as the Court observes in Mavi,
this doctrine has its limits. In Genex Communications Inc v Canada (Attorney
General), 2005 FCA 283, Mr. Justice Létourneau provided a concise
explanation of those limits:
[191] It is well known that the doctrine
of reasonable expectations is procedural and does not create any fundamental
rights: it is simply an extension of the principles of natural justice and the
rules of procedural equity: see Old St. Boniface Residents Assn. Inc. v.
Winnipeg (City), [1990] 3 S.C.R. 1170, at paragraph 74; Moreau-Bérubé v.
New Brunswick (Judicial Council), [2002] 1 S.C.R. 249. “The doctrine can
give rise to a right to make representations, a right to be consulted or
perhaps, if circumstances require, more extensive procedural rights. But it
does not otherwise fetter the discretion of a statutory decision-maker in order
to mandate any particular result.” [Emphasis added]. See Moreau-Bérubé,
supra, at paragraph 78. The expectation must not conflict with the public
authority’s statutory mandate and substantive relief is not available under
this doctrine: see Mount Sinai Hospital Center v. Quebec (Minister of Health
and Social Services), [2001] 2 S.C.R. 281, at paragraphs 29, 32 and 38.
[123] Again just recently, the Federal Court of Appeal pointed out that
only clear, unambiguous and unqualified representations may give rise to the
doctrine (see Drabinsky v Canada (Advisory Council of the Order), 2015
FCA 5, at para 8). The Minister promised a fair and impartial process. This is
where the reasonable expectation ended, and it was fulfilled.
[124] When we take a closer look, this last argument of the applicant is
just another variation on the previous theme of bias. Thus, it complains that
the request for proposals was not [translation]
“biddable” because the flexibility requested was not granted; the Minister’s
conduct did not meet the high level of fairness and impartiality promised; and
the applicant’s comments and proposals were not truly taken into consideration.
[125] To some degree, the applicant is departing from the procedural
nature of the doctrine. It seeks to judge the process based on the outcome. But
the outcome is of little consequence given that none of the factors associated
with bias were accepted by this Court. Application of the doctrine did not give
rise to the remedy sought because the Minister followed the promised procedure
closely. This is what the applicant was entitled to. What the applicant is
complaining about is not obtaining all the requested changes. The applicant
appears to believe that because not all the changes were accepted, the process
must have been flawed. However, in terms of procedure, the Minister delivered
on his promises; the applicant was not entitled to a particular outcome. It had
a right to be consulted. Moreover, there is no proof of the alleged bias,
therefore it was not established that the changes were rejected for arbitrary
or unjust reasons.
[126] I would conclude by citing paragraph 59 of the Federal Court of
Appeal decision in Cougar, cited above:
[59] In my opinion, even when
considered cumulatively, the grounds advanced by the applicant for impugning
the impartiality and fairness of the tendering process do not establish a
breach of the duty of fairness. Decisions made in the course of the
decision-making process that are perceived by a participant to be adverse to
its interests will normally not suffice to prove a reasonable apprehension of
bias in the decision-maker. Nor does the duty of fairness require a
decision-maker to adopt the best possible process for arriving at the “right”
decision.
VI.
Conclusion
[127] The respondents had argued that if the Court decided to grant the
application for judicial review, the contract should not be cancelled as a
result of a tendering process deemed unlawful. They relied in particular on MiningWatch
Canada v Canada (Fisheries and Oceans), [2010] 1 SCR 6 [MiningWatch],
contending that the public interest and prejudice to the respondents would
justify the Court using its discretion in the area of judicial review to
decline the requested remedy.
[128] Clearly, the Court does not have to rule on this given the outcome
of the application for judicial review. I would not have been inclined on the
face of it to deny the requested remedy given that the rule of law takes
precedence and the respondents obviously chose to proceed despite the risk
posed by the application for judicial review. Nevertheless, it is neither
necessary nor worthwhile to continue seeking the balance of convenience in this
case, where the nature of the remedy is very different from that in MiningWatch,
in which the question of law was the central interest of MiningWatch, a
non-profit corporation.
[129] For the reasons above, the application for judicial review must be
dismissed.
[130] It was agreed that the question of costs would be dispensed with
after the decision was rendered. If the parties are unable to agree on the
basis on which costs should be awarded, the Court Registry will schedule a
hearing, in person or by telephone, at the convenience of the parties.