United Taxi Drivers' Fellowship of Southern Alberta v. Calgary (City), 2004 SCC 19, [2004] 1 SCR 485

United Taxi Drivers’ Fellowship of Southern Alberta v. Calgary (City), [2004] 1 S.C.R. 485, 2004 SCC 19

City of Calgary                                                                                                 Appellant

v.

United Taxi Drivers’ Fellowship of Southern Alberta,

Rashpal Singh Gosal, Haringer Singh Dhesi,

Aero Cab Ltd. and Air Linker Cab Ltd.                                                     Respondents

and

Attorney General of Alberta                                                                          Intervener

Indexed as:  United Taxi Drivers’ Fellowship of Southern Alberta v. Calgary (City)

Neutral citation:  2004 SCC 19.

File No.:  29321.

2003:  December 8; 2004: March 25.

Present:  McLachlin C.J. and Iacobucci, Major, Bastarache, Binnie, Arbour, LeBel, Deschamps and Fish JJ.

on appeal from the court of appeal for alberta

Municipal law — Bylaws — Jurisdiction to pass bylaws — Municipal bylaw regulating taxi industry by stipulating licence requirements and freezing number of licences — Proper approach to interpretation of statutes empowering municipalities — Whether bylaw ultra vires municipality under its governing legislation — Municipal Government Act, S.A. 1994, c. M-26.1, ss. 7, 8, 9.

Administrative law — Judicial review — Standard of review applicable to decision of municipality delineating its jurisdiction.

The City of Calgary regulates its taxi industry by virtue of the Taxi Business Bylaw which requires that all taxis have a taxi plate licence.  In 1993, the bylaw froze the number of taxi plate licences issued.  The following year, the provincial government enacted a new Municipal Government Act.  The respondents challenged the validity of the freeze on the issuance of taxi plate licences on the basis that the freeze is ultra vires the City under its governing legislation, the Municipal Government Act.  The trial judge held that the City had authority under the new Act to limit the number of taxi plate licences.  A majority of the Court of Appeal reversed that decision.

Held:  The appeal should be allowed.

The City of Calgary was authorized under the Municipal Government Act to enact the bylaw and to limit the number of taxi plate licences.  Municipalities must always be correct in delineating their jurisdiction.  Such questions will always be subject to a standard of review of correctness.

The evolution of the municipality has produced a shift in the proper approach to interpreting statutes that empower municipalities.  A broad and purposive approach to the interpretation of municipal legislation reflects the true nature of modern municipalities which require greater flexibility in fulfilling their statutory purposes and is consistent with the Court’s approach to statutory interpretation generally.  The Municipal Government Act reflects the modern method of drafting municipal legislation which must be construed using this broad and purposive approach.

Under the Municipal Government Act the City still has the power to limit the issuance of taxi plate licences.  There is no indication in the Act that the legislature intended to remove the municipality’s power to limit the number of taxi plate licences.  To the contrary, s. 9(b) indicates that the legislature sought to enhance the City’s powers under the Act.  Further, the respondents’ narrow interpretation cannot be reconciled with the language of the Act. Section 7 which empowers municipalities to pass bylaws respecting business must be read with s. 8 of the Act illustrating some of the broad powers exercisable by a municipality.  The power to limit the number of licences could fall under either s. 8(a), the power to regulate, or s. 8(c), the power to provide for a system of licences.  Thus, the City has the power under the Act to pass bylaws limiting the number of taxi plate licences.

Cases Cited

Referred to:  Nanaimo (City) v. Rascal Trucking Ltd., [2000] 1 S.C.R. 342, 2000 SCC 13; Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231; Bell ExpressVu Limited Partnership v. Rex, [2002] 2 S.C.R. 559, 2002 SCC 42; Merritt v. City of Toronto (1895), 22 O.A.R. 205.

Statutes and Regulations Cited

Alberta Bill of Rights, R.S.A. 2000, c. A-14, s. 1.

Canadian Charter of Rights and Freedoms , ss. 6 , 7 , 15 .

Cities Act, S.S. 2002, c. C-11.1.

City of Calgary, Bylaw No. 91/77, Taxi Business Bylaw (April 18, 1977), ss. 7(1), 9.1(a), (b) [am. 23M93], 9.2(a), (b), 9.3(a).

Gaming and Liquor Act, R.S.A. 2000, c. G-1, s. 37(1)(d).

Interpretation Act, R.S.A. 2000, c. I-8, s. 10.

Municipal Act, R.S.Y. 2002, c. 154.

Municipal Act, S.M. 1996, c. 58, C.C.S.M. c. M225.

Municipal Act, 2001, S.O. 2001, c. 25.

Municipal Government Act, R.S.A. 1980, c.  M-26, ss. 234(1) [am. 1991, c. 23, s. 3(13)], (2)(a) [idem], (b) [idem], 8.

Municipal Government Act, S.A. 1994, c. M-26.1 [now R.S.A. 2000, c. —26], ss. 3,  7, 8, 9, 70-75, 715.

Municipal Government Act, S.N.S. 1998, c. 18.

Wildlife Act, R.S.A. 2000, c. W-10, s. 13(1)(a).

Authors Cited

Driedger, Elmer A.  Construction of Statutes, 2nd ed.  Toronto:  Butterworths, 1983.

Oxford English Dictionary, vol. XIII, 2nd ed.  Oxford:  Clarendon Press, 1989, “regulate”.

Sullivan, Ruth.  Sullivan and Driedger on the Construction of Statutes, 4th ed.  Markham, Ont.:  Butterworths, 2002.

APPEAL from a judgment of the Alberta Court of Appeal, [2002] 8 W.W.R. 51, 3 Alta. L.R. (4th) 211, 303 A.R. 249, 273 W.A.C. 249, 94 C.R.R. (2d) 290, 30 M.P.L.R. (3d) 155, [2002] A.J. No. 694 (QL), 2002 ABCA 131, reversing a judgment of the Court of Queen’s Bench (1998), 60 Alta. L.R. (3d) 165, 217 A.R. 1, 45 M.P.L.R. (2d) 16, [1998] A.J. No. 1478 (QL), 1998 ABQB 184.  Appeal allowed.

Leila J. Gosselin, Brand R. Inlow, Q.C., and R. Shawn Swinn, for the appellant.

Dale Gibson and Sandra Anderson, for the respondents United Taxi Drivers’ Fellowship of Southern Alberta, Rashpal Singh Gosal and Haringer Singh Dhesi.

No one appeared for the respondent Aero Cab Ltd.

Gabor I. Zinner, for the respondent Air Linker Cab Ltd.

Lorne Merryweather, for the intervener.

The judgment of the Court was delivered by

Bastarache J. —

I.       Overview

1                                   The City of Calgary (the “City”) regulates its taxi industry by virtue of Bylaw No. 91/77, the Taxi Business Bylaw (the “bylaw”), which sets out several licensing requirements. Among them is a requirement that all taxi vehicles have a taxi plate licence.  In 1986, the City’s Taxi Commission adopted a restricted entry system for the taxi business to increase efficiency and stability, and accordingly froze the number of taxi plate licences. The freeze was continued in 1993 under s. 9.1 of the bylaw.  Other sections of the bylaw permitted the transfer of licences and the creation of a lottery system to distribute revoked or relinquished licences. The following year, the provincial government enacted a new Municipal Government Act, S.A. 1994, c. M-26.1 (now R.S.A. 2000, c. M-26).   Section 715 of the new Act deemed the existing bylaw to have the same effect as if it had been passed under the new Act.

2                                   The respondents, the United Taxi Drivers’ Fellowship of Southern Alberta, Rashpal Singh Gosal, Haringer Singh Dhesi, Aero Cab Ltd. and Air Linker Cab Ltd., challenged the validity of the freeze and the lottery process. The respondents sought a declaration that the City’s actions were: ultra vires the City’s governing legislation, the Municipal Government Act; a violation of the common law rule prohibiting municipalities from enacting discriminatory legislation; and an unconstitutional violation of their mobility rights, their right to liberty and their right to be free from discrimination as guaranteed by ss. 6 , 7  and 15  of the Canadian Charter of Rights and Freedoms .  The only issue before this Court is whether the City’s freeze on the issuance of taxi plate licences was ultra vires the City under the Municipal Government Act.

3                                   The trial judge concluded that the City had the authority under the Municipal Government Act to limit the number of taxi plate licences: (1998), 60 Alta. L.R. (3d) 165, 1998 ABQB 184.   The majority of the Court of Appeal disagreed:  [2002] 8 W.W.R. 51, 2002 ABCA 131.  Wittmann J.A., writing for the majority, concluded that while the old Municipal Government Act expressly granted the City the power to limit the number of taxi plate licences, the new Act did not.  O’Leary J.A., in dissent, held that the new Municipal Government Act expressly and impliedly authorized the limit on the issuance of taxi plate licences.

II.     Relevant Statutory Provisions

4                                   City of Calgary, Bylaw No. 91/77 (Taxi Business Bylaw)

7.    (1)       The Commission may limit the number of taxi licenses, which may be issued in any one-license period.

. . .

9.1  (a)                                                                              The prohibition on the issuance of any new taxi licenses for the operation of a regular class taxi instituted by the Taxi Commission as of February 6, 1986, and continued by the Taxi Commission up to the date of the passage of this Bylaw, is hereby continued and the Taxi Commission shall issue no new licenses for the operation of a regular class taxi but only renew to licensees, in accordance with the Taxi Business Bylaw, such regular class taxi licenses as were issued to such licensees for the previous license year.

(b)       Notwithstanding subsection (a) the Taxi Commission may issue licenses in accordance with the lottery provisions described in Section 9(28) . . . .

9.2  (a)                                                                              “immediate family member” means the spouse, siblings or children of the taxi licensee.

(b)       Notwithstanding section 9(15) a taxi license held by a deceased taxi licensee shall be capable of being transferred to the estate of the deceased licensee, or to an immediate family member of the deceased, if the transfer occurs without remuneration from the estate of the deceased to the transferee.

. . .

9.3  (a)                                                                              The licensee of a taxi license shall not transfer or otherwise dispose of a taxi license unless:

(1)     the licensee does so in accordance with this Bylaw and the regulations; and

(2)     the licensee pays the license transfer fee as set out in this Bylaw.

Municipal Government Act, R.S.A. 1980, c. M-26

234(1)  A council may pass by-laws licensing, regulating and controlling the taxi and limousine business.

(2)  Without restricting the generality of the foregoing a  council may pass by-laws to

(a)  establish and specify the rates or fares that may be charged for hire of taxis and limousines;

(b)  limit the number of taxi and limousine licences that may be issued in the municipality having regard to its population or the area to be served in it or by any other means the council considers to be just and equitable;

. . .

(8)  A council, by by-law, may establish a commission to be known as the taxi commission

(a)  which shall be composed of the number of resident electors the council selects including, if it seems desirable, any members of council or officials of the municipality who are considered appropriate, and

(b)  which may exercise any power or make any decisions  which the council may make pursuant to this section   as the by-law provides.

Municipal Government Act, S.A. 1994, c. M-26.1

3     The purposes of a municipality are

(a)     to provide good government,

(b)     to provide services, facilities or other things that, in the opinion of council, are necessary or desirable for all or a part of the municipality, and

(c)     to develop and maintain safe and viable communities.

. . .

7     A council may pass bylaws for municipal purposes respecting the following matters:

(a)                 the safety, health and welfare of people and the protection of people and property; 

 . . .

(d)     transport and transportation systems;

(e)                 businesses, business activities and persons engaged in business; . . .

8  Without restricting section 7, a council may in a bylaw passed under this Division

(a)                 regulate or prohibit;

(b)     deal with any development, activity, industry, business or thing in different ways, divide each of them into classes and deal with each class in different ways;

(c)                 provide for a system of licences, permits or approvals, including . . . :

. . .

(iii)        prohibiting any development, activity, industry, business or thing until a licence, permit or approval has been granted;

(iv)       providing that terms and conditions may be imposed on any licence, permit or approval, the nature of the terms and conditions and who may impose them;

(v)        setting out the conditions that must be met before a licence, permit or approval is granted or renewed, the nature of the conditions and who may impose them;

(vi)       providing for the duration of licences, permits and approvals and their suspension or cancellation for failure to comply with a term or condition of the bylaw or for any other reason specified in the bylaw;

. . .

9     The power to pass bylaws under this Division is stated in general terms to

(a)     give broad authority to councils and to respect their right to govern municipalities in whatever way the councils consider appropriate, within the jurisdiction given to them under this or any other enactment, and

(b)     enhance the ability of councils to respond to present and future issues in their municipalities. 

. . .

715  A bylaw passed by a council under the former Municipal Government Act . . . continues with the same effect as if it had been passed under this Act.

III.     Analysis

A.      The Standard of Review

5                                   The only question in this case is whether the freeze on the issuance of taxi plate licences was ultra vires the City under the Municipal Government Act. Municipalities do not possess any greater institutional competence or expertise than the courts in delineating their jurisdiction. Such a question will always be reviewed on a standard of correctness: Nanaimo (City) v. Rascal Trucking Ltd., [2000] 1 S.C.R. 342, 2000 SCC 13, at para. 29. There is no need to engage in the pragmatic and functional approach in a review for vires; such an inquiry is only required where a municipality’s adjudicative or policy-making function is being exercised.

B.     The Proper Approach to the Interpretation of Municipal Powers

6                                   The evolution of the modern municipality has produced a shift in the proper approach to the interpretation of statutes empowering municipalities. This notable shift in the nature of municipalities was acknowledged by McLachlin J. (as she then was) in Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231, at pp. 244-45. The “benevolent” and “strict” construction dichotomy has been set aside, and a broad and purposive approach to the interpretation of municipal powers has been embraced: Nanaimo, supra, at para. 18. This interpretive approach has evolved concomitantly with the modern method of drafting municipal legislation. Several provinces have moved away from the practice of granting municipalities specific powers in particular subject areas, choosing instead to confer them broad authority over generally defined matters: The Municipal Act, S.M. 1996, c. 58, C.C.S.M. c. M225; Municipal Government Act, S.N.S. 1998, c. 18; Municipal Act, R.S.Y. 2002, c. 154; Municipal Act, 2001, S.O. 2001, c. 25; The Cities Act, S.S. 2002, c. C-11.1. This shift in legislative drafting reflects the true nature of modern municipalities which require greater flexibility in fulfilling their statutory purposes: Shell Canada, at pp. 238 and 245.

7                                   Alberta’s Municipal Government Act follows the modern method of drafting municipal legislation. The legislature’s intention to enhance the powers of its municipalities by drafting the bylaw passing provisions of the Act in broad and general terms is expressly stated in s. 9. Accordingly, to determine whether a municipality is authorized to exercise a certain power, such as limiting the issuance of taxi plate licences, the provisions of the Act must be construed in a broad and purposive manner.

8                                   A broad and purposive approach to the interpretation of municipal legislation is also consistent with this Court’s approach to statutory interpretation generally. The contextual approach requires “the words of an Act . . . to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament”: E. A. Driedger, Construction of Statutes (2nd ed. 1983), at p. 87;  Bell ExpressVu Limited Partnership v. Rex, [2002] 2 S.C.R. 559, 2002 SCC 42, at para. 26. This approach is also consistent with s. 10 of Alberta’s Interpretation Act, R.S.A. 2000, c. I-8, which provides that every provincial enactment must be given a fair, large and liberal construction and interpretation that best ensures the attainment of its objects.

C.    The City’s Power to Limit the Number of Licences

9                                   The respondents argue that the City does not have the power to limit the number of taxi plate licences under the Act. They submit that the authority to regulate has never implied numerical limits and that ss. 7 and 8 of the current Municipal Government Act, unlike s. 234 of the previous Municipal Government Act, neither expressly nor impliedly grant a municipality the power to limit the number of taxi plate licences. The respondents argue that while the Act expands the “matters” over which municipalities may enact bylaws under s. 7, the Act limits the “powers” exercisable by municipalities to those expressly specified.  As the power to limit the number of taxi plate licences is not expressly specified in s. 8, the respondents allege it has been abolished.

10                               In my respectful opinion, the respondents’ argument must fail.

11                               It is well established that the legislature is presumed not to alter the law by implication: Sullivan and Driedger on the Construction of Statutes (4th ed. 2002), at p. 395. Rather, where it intends to depart from prevailing law, the legislature will do so expressly. Here, there is no indication in the Act that the legislature intended to remove the municipality’s power to limit the number of taxi plate licences. To the contrary, s. 9(b) indicates that the legislature did not intend to curtail the powers exercised by municipalities but rather sought to enhance those powers under the new Act subject to the limitations in ss. 70 to 75, which do not preclude limiting the number of taxi licences. It is inconceivable, in my view, that the legislature would have intended to indirectly limit the ability of municipalities to regulate the taxi industry according to a practice dating 15 years and to adopt the restrictive approach defined in Merritt v. City of Toronto (1895), 22 O.A.R. 205, at pp. 207-8, simply by changing its method of drafting legislation. The new method was in fact specifically designed to avoid the need for listing specific matters and powers. Accordingly, a provision explicitly limiting the number of licences such as s. 13(1)(a) of the Wildlife Act, R.S.A. 2000, c. W-10, and s. 37(1)(d) of the Gaming and Liquor Act, R.S.A. 2000, c. G-1, is unnecessary.

12                               The respondents’ narrow interpretation cannot be reconciled with the language of the Act.  According to the respondents, the broad authority conferred on municipalities only applies to s. 7 which deals exclusively with matters and not to s. 8 which deals exclusively with powers. I disagree. First, s. 9 clearly states that the power to pass bylaws is stated in general terms to “give broad authority” in respect of matters attributed to them. Second, to accept this matter/power distinction renders the opening words of s. 8, “[w]ithout restricting section 7”, useless. Rather, ss. 7 and 8 must be read together, as one is without restriction to the other. Section 8 is supplementary to s. 7 and speaks of the “broad authority” mentioned in s. 9. On this reading of ss. 7, 8 and 9 the respondents’ interpretation must be rejected because their narrow and literal approach to s. 8 effectively restricts s. 7, which grants the power to regulate businesses.

13                               Applying a broad and purposive interpretation, ss. 7 and 8 grant the City the power to pass bylaws limiting the number of taxi plate licences. As discussed, s. 8 supplements s. 7 by illustrating some of the broad powers exercisable by a municipality. Here the power to limit the number of licences could fall under either s. 8(a), the power to regulate, or s. 8(c), the power to provide for a system of licences. To “regulate”, as defined in the Oxford English Dictionary (2nd ed. 1989), vol. XIII, is “subject to . . . restrictions”. Thus, as O’Leary J.A. in dissent aptly stated, the “jurisdiction to regulate the taxi business necessarily implies the authority to limit the number of TPLs [taxi plate licences] issued”: para. 202.  This accords with the legislative history.

14                               The power to limit the issuance of licences also falls under the power to provide for a system of licences under s. 8(c). Sections 8(c)(i) through (vi) represent some of the types of bylaws that provide for a system of licences. The use of the word “including” indicates that the list is non-exhaustive; therefore, any type of bylaw that is consistent with the list is authorized. There is clearly no room for the application of the expressio unius est exclusio alterius principle advocated by the respondents. Common to each of the provisions is the power to impose limitations on licences such as setting out the conditions that must be satisfied before a licence is granted or renewed. The bylaw limiting the number of taxi plate licences is consistent with the examples provided as it also imposes a specific limit on a licensed activity.

15                               The respondents have also argued that the bylaw is inconsistent with the right to enjoyment of property protected by the Alberta Bill of Rights, R.S.A. 2000, c. A-14, s. 1, and with s. 3 of the Municipal Government Act which provides that the purposes of municipalities are good governance and the development and maintenance of safe and viable communities. Both arguments relate to the effects of the bylaw which the respondents allege have transformed taxi licences into an expensive commodity benefiting a small group of brokers.

16                               As noted earlier in these reasons, there is no challenge before this Court to the legislation based on the Charter  and no record to support the allegation now being made that the Alberta Bill of Rights has been breached. This Court in Bell ExpressVu, supra, at para. 62, held that absent any challenge on constitutional grounds, courts are bound to interpret and apply statutes in accordance with the sovereign intent of the legislature. In this case, I find no ambiguity in the legislation that would bring me to consider whether the Act is reflective of Charter  values and no reason to question the authority of the Council for the City of Calgary to decide the best interests of its citizens in the regulation of the taxi industry. Here, as in Bell ExpressVu, some citizens are affected by the restrictions imposed, but this has no bearing on the jurisdiction of the municipal government to regulate.

17                               Accordingly, the City of Calgary was authorized under the Act to enact Bylaw 91/77.

IV.      Conclusion

18                               The appeal is allowed with costs throughout.

Appeal allowed with costs.

Solicitor for the appellant:  City of Calgary Law Department, Calgary.

Solicitors for the respondents United Taxi Drivers’ Fellowship of Southern Alberta, Rashpal Singh Gosal and Haringer Singh Dhesi:  Dale Gibson & Associates, Edmonton.

Solicitors for the respondent Air Linker Cab Ltd.:  Zinner & Sara, Calgary.

Solicitor for the intervener:  Attorney General of Alberta, Edmonton.