Date: 19991129
Docket: A-46-99
CORAM: ROBERTSON, J.A.
ROTHSTEIN, J.A.
MCDONALD, J.A.
BETWEEN:
CANADIAN NATIONAL RAILWAY COMPANY
Appellant
CANADIAN TRANSPORTATION AGENCY
Respondent
Heard at Edmonton, Alberta, on Monday, November 29, 1999
Judgment delivered from the Bench at Edmonton, Alberta, on Monday,
November 29, 1999
REASONS FOR JUDGMENT OF THE COURT BY: ROTHSTEIN J.A.
Date: 19991129
Docket: A-46-99
CORAM: ROBERTSON, J.A.
ROTHSTEIN, J.A.
MCDONALD, J.A.
BETWEEN:
CANADIAN NATIONAL RAILWAY COMPANY
Appellant
CANADIAN TRANSPORTATION AGENCY
Respondent
REASONS FOR JUDGMENT OF THE COURT
| (Delivered from the Bench, at Edmonton, Alberta, on |
| Monday, November 29th, 1999.) |
ROTHSTEIN, J.A.
ISSUE
[1] The issue in this appeal from a decision of the Canadian Transportation Agency is whether section 98 of the Canada Transportation Act1 requires a railway company to apply to the Agency for approval to construct a railway yard.
FACTS
[2] In the spring of 1998 it was brought to the attention of the Agency that Canadian National Railway Company intended to construct two railway yards in the Edmonton area: the Scotford Satellite Yard and the Edmonton Intermodal Yard Facility. C.N. had not sought approval from the Agency to do so. The Agency wrote to C.N. asking that it file submissions as to why Agency approval was not necessary. On July 15, 1998, C.N. made its submissions advising that it was not proceeding with the Scotford Satellite Yard but was proceeding with the Edmonton Intermodal Yard Facility. C.N. gave reasons why it did not consider it necessary to apply for Agency approval to construct the Edmonton Intermodal Yard Facility. By decision LET-R-238 1998 dated September 9, 1998, the Agency determined that an application for the construction of the Edmonton Intermodal Yard Facility was required. This is an appeal, with leave, pursuant to subsection 41(1) of the Act, from that decision.
STANDARD OF REVIEW
[3] If C.N. is required to file an application to construct the Edmonton Intermodal Yard Facility under section 98 of the Canada Transportation Act, the Agency has jurisdiction to approve or not approve the construction of the yard. Otherwise it does not. Accordingly, the question of whether an application under section 98 is required is one which goes to the Agency's jurisdiction. In Pezim v. British Columbia (Superintendent of Brokers), [1994] 2 S.C.R. 557, Iacobucci, J. states at page 590:
| "At the correctness end of the spectrum, where deference in terms of legal questions is at its lowest, are those cases where the issues concern the interpretation of a provision limiting the tribunal's jurisdiction (jurisdictional error)..." |
Questions of jurisdiction are subject to review by the Court on a standard of correctness and that is the standard applicable in this case.
MOOTNESS
[4] Counsel for C.N. advised the Court that notwithstanding this appeal, C.N. did apply to the Agency for approval to construct the Edmonton Intermodal Yard Facility and received approval subject to certain conditions. Arguably the appeal is moot. However, counsel for C.N. stated that a finding overruling the Agency's assumption of jurisdiction in this case would eliminate some obligations imposed on C.N. by the Agency with respect to the construction of the Edmonton Intermodal Yard Facility. Further, the extent of the Agency's jurisdiction over railway companies under legislation in which Parliament has signalled its preference for the minimization of economic regulation is a matter of public importance. In this context, a decision on the merits of this case will obviate the necessity for future repetitious litigation in respect of the Agency's jurisdiction under section 98. We therefore exercise our discretion to proceed to hear and decide the appeal. See Borowski v. Canada (Attorney General) [1989] 1 S.C.R. 342, at 353-365.
C.N.'S POSITION
[5] Section 98 provides:
| (1) A railway company shall not construct a railway line without the approval of the Agency |
| (2) The Agency may, on application by the railway company, grant the approval if it considers that the location of the railway line is reasonable, taking into consideration the requirements for railway operations and services and the interests of the localities that will be affected by the line |
| (3) No approval is needed for the construction of a railway line |
| (a) within the right of way of an existing railway; or |
| (b) within 100 m. of the centre line of an existing railway line for a distance of no more than 3 km. |
[6] C.N. says the Agency has no jurisdiction over construction of railway yards as section 98 only deals with railway lines. The essence of C.N.'s argument is that a railway line refers only to the lines between termini or origins and destinations over which the railway company will carry out its common carrier obligations. A yard is for the operational requirements of the railway company. C.N. submits that the term "railway line" is narrower than the term "railway" which is defined in section 87 of the Act:
| "railway" means a railway within the legislative authority of Parliament and includes |
| (a) branches, extensions, sidings, railway bridges, tunnels, stations, depots, wharfs, rolling stock, equipment, stores, or other things connected with the railway, and |
| (b) communications or signalling systems and related facilities and equipment used for railway purposes; |
While C.N. concedes that the term "railway" would include a railway yard and railway lines, it argues that Parliament expressly restricted the application of section 98 to railway lines. C.N. says railway lines do not contemplate yards.
DEFINING A RAILWAY LINE
[7] The Canada Transportation Act does not define the term "railway line". However, the definition of "railway" and the context of other specific provisions of the Act provide guidance as to what is intended. The words of subsection 98(1) indicate that it is something that is to be constructed. The words of subsection 98(3) envisage the construction of two or perhaps more railway lines within the right of way of an existing railway line and railway lines outside the right-of-way but within a 100 m. of the centre line of an existing railway line.
[8] Although references to other provisions of the Act could be made, these are sufficient to indicate what Parliament had in mind. A railway line is the structure upon which locomotives and rolling stock of railway companies move and the communications or signalling system and related facilities and equipment. Colloquially one might refer to "railway tracks", but, of course much more is involved, as C.N.'s counsel indicated, including the provision of grade and subgrade, including the construction of embankments and cuts, the installation of facilities for drainage, bridges, tunnels, and the track structure itself consisting of ballast, ties, rails, spikes, switches, and the like. All these components together, located on the right of way occupied by the railway company are what permit and facilitate the movement of locomotives and rolling stock, namely, a railway line.
CAN THERE BE RAILWAY LINES IN RAILWAY YARDS?
[9] Once it is accepted that a railway line is what permits and facilitates the movement of locomotives and rolling stock, it is apparent that no distinction is made in section 98 between a railway line from one terminus to another and a railway line for operational requirements in a yard. Under paragraph 98(3)(a) no Agency approval is needed for a railway line constructed within the right of way of an existing railway line. There is no indication that the additional railway line need be between termini, or indeed, of anything about the length of the railway line. Under paragraph 98(3)(b), no Agency approval is needed for the construction of a railway line within 100 m. of the centre line of an existing railway line for a distance of no more than 3 km. It is obvious than a line of 3 km or less will rarely if ever be a line between two termini. Indeed, such relatively short railway lines in close proximity to an existing railway line may, in some cases, constitute railway lines for the storage of cars or the operational requirements of the railway company, that is, railway lines in a railway yard.
[10] Other provisions of the Canada Transportation Act also support the view that a railway line may exist in a railway yard. For example, sections 100 and 101 deal with road and utility crossings of railway lines. In the absence of agreement, the Agency may authorize the construction of a suitable crossing. In section 100 road crossing is defined:
| "road crossing" means the part of a road that passes across, over or under a railway line, and includes a structure supporting or protecting that part of the road or facilitating the crossing; |
There is no reason why this provision would deal only with road or utility crossings of railway lines between termini but not with railway lines in yards.
[11] Interpreting railway lines as including those in railway yards is also indicated by section 140 in DIVISION V of the Act: TRANSFERRING AND DISCONTINUING THE OPERATION OF RAILWAY LINES. Section 140 provides:
| (1) In this Division, "railway line" includes a portion of a railway line, but does not include |
| (a) a yard track, siding or spur; or |
| (b) other track auxiliary to a railway line. |
| (2) The Agency may determine as a question of fact what constitutes a yard track, siding, spur or other track auxiliary to a railway line. |
The necessary implication of subsection 140(1) is that in the absence of the express statutory exception it provides for purposes of DIVISION V, a yard track is a railway line. Section 98 is in DIVISION II: CONSTRUCTION AND OPERATION OF RAILWAYS. It is unaffected by the exception in section 140 and by implication, a railway line in section 98 would include a yard track.
[12] C.N. argues that it is inconsistent to interpret the legislation to require the construction of railway lines in a yard to be subject to regulatory approval but not to require approval for their discontinuance or transfer. However, this argument fails to recognize the difference in context between section 98 in DIVISION II and DIVISION V. The purpose of section 98 is to provide regulatory oversight over the location of railway lines, including railway lines in yards, having regard to the interests of affected localities. Here, the Act is concerned with balancing the requirements for railway operations and services as advanced by the railway company, with the effect of the physical co-existence of railway lines in proximity to localities. This is not economic regulation.
[13] The purpose of DIVISION V is to provide a regulatory scheme over the transfer and discontinuance of railway lines. This is a form of economic regulation. In this context, it is only necessary to focus on the railway lines providing service to shippers and consignees. There is no need to regulate the transfer or discontinuance of railway lines in a yard and their express exception in DIVISION V is intended to eliminate an unnecessary economic regulatory burden on railway companies. Considering the different regulatory purposes demonstrates there is nothing inconsistent between requiring approval to construct a railway line in a railway yard, but not to subject the railway company to an economic regulatory burden on the transfer or discontinuance of a railway line in a yard.
[14] While C.N.'s reference to prior legislation governing railways provides some background, this case must be decided having regard to the words in the Canada Transportation Act itself. In any event, it appears that in prior legislation the terms "railway" and "railway lines" are both used, sometimes in the same section, e.g. Railway Act2 subsections 123(1) and (3). Although it does not appear that Parliament has been rigorous in distinguishing between railways and railway lines throughout the Railway Act, and indeed, the Canada Transportation Act, generally it seems the term "railway" applies to both railway lines and locomotives and rolling stock of the railway company, while the term "railway line" refers only to the physical structure and communications or signalling system which permits and facilitates the movement of locomotives and rolling stock. Although the term "railway line" is narrower than "railway", it still covers the structure and communication or signalling system, whether between termini or in a railway yard.
[15] Although C.N. submits that a yard is invisible to a shipper or consignee and that the public might associate the term "railway line" as being between termini rather than in a railway yard, these are not relevant considerations. The issue is the interpretation of words in a statute.
[16] To interpret the term "railway line" as being only a line between termini leads to illogical results. As previously indicated, there is no rationale which suggests that the Agency would have jurisdiction over road and utility crossings of railway lines between termini but not over railway lines in a yard. Indeed, having regard to section 98 itself, there is no logical reason why Parliament would have provided for regulatory oversight over the location of railway lines between termini but not those in a yard. As the purpose of section 98 is to confer jurisdiction on the Agency to consider whether the location of a railway line is reasonable, having regard to the interests of localities affected by the line, there is as much reason for the Agency to exercise that jurisdiction with respect to railway lines in yards as railway lines between termini. While the term "railway line" may, in some provisions of the Act refer to lines between termini, the term is not so limited in every application and specifically, is not so limited in section 98.
[17] In saying this, we respect Parliament's intention in the Act to minimize the regulatory burden on railway companies. In this context, counsel for C.N. expressed the concern that if each and every railway track were considered a railway line, the intention of section 140, to reduce the regulatory burden associated with discontinuance of railway lines could be frustrated. He suggested, for example, that if a railway company wanted to discontinue the operation of one of two parallel railway lines between termini, section 140 would not relieve it of the burden of the regulatory provisions under DIVISION V if each was considered a railway line. However, under subsection 140(2), the Agency is to determine, as a question of fact, what constitutes "other track auxiliary to a railway line", and we are confident that should a railway company consider it necessary to ask the Agency for such a determination, a redundant railway line that the railway company did not consider necessary for it to perform its common carrier obligations would easily fit within that exception.
[18] We also acknowledge that as a result of the requirement to obtain Agency approval to construct railway lines in the Edmonton Intermodal Yard Facility, a federal environmental assessment is triggered pursuant to paragraph 5(1)(d) of the Canadian Environmental Assessment Act.3 The Agency is the responsible authority to carry out the environmental assessment. C.N. says that it accepts that the construction of the yard would require some form of environmental assessment, but is concerned with a number of agencies and assessments that would be involved. It was not made clear to the Court what other environmental assessments might be contemplated.
[19] To the extent that the Canada Transportation Agency is the responsible authority for environmental assessment, it should be noted that it has a responsibility, not only under the Canadian Environmental Assessment Act, but also under the Canada Transportation Act. In assessing whether the location of the railway lines are reasonable under subsection 98(2), it must have regard to the requirements for railway operations and services. It must also be cognizant of the National Transportation Policy in section 5 of the Canada Transportation Act which, in relevant part, is that safe, economic, efficient and adequate transportation services at the lowest total cost is essential to serve the transportation needs of shippers. The Agency's function is to balance the objectives of the National Transportation Policy, and the requirement of the railway company in respect of its operations and services, with the interests of affected localities and environmental requirements under the Canadian Environmental Assessment Act. The Agency is considered to have expertise in these areas. In imposing burdens on the railway company, the Agency must be reasonable and must not ignore the requirements for railway operations and services and the intent of the National Transportation Policy that the railway company be able to provide economic and efficient transportation services to its shippers.
CONCLUSION
[20] Despite the well researched argument of counsel for C.N., we must conclude that section 98 applies to railway lines in the Edmonton Intermodal Yard Facility and that the Agency has jurisdiction to approve or not approve the construction of railway lines in the yard, having regard to whether their location is reasonable, taking into consideration requirements for railway operations and services and the interests of the localities that will be affected by the lines. The appeal will be dismissed.
"Marshall Rothstein"
J.A.
__________________
1 S.C. 1996 C. 10.
2 R.S.C. 1985 C. R-3.
3 R.S. 1992, C. 37, c. 15.2.
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