Date:
20120202
Docket:
A-441-10
Citation: 2012 FCA 36
CORAM: BLAIS
C.J.
EVANS
J.A.
SHARLOW
J.A.
BETWEEN:
TURNAROUND COURIERS INC.
Applicant
and
CANADA POST CORPORATION
Intervener
(supporting the Applicant)
and
CANADIAN UNION OF POSTAL WORKERS
Respondent
and
ATTORNEY GENERAL OF ONTARIO
Intervener
REASONS
FOR JUDGMENT
EVANS J.A.
Introduction
[1]
The
question to be decided in this case is whether a bicycle and pedestrian courier
company is providing “Postal Service” within the meaning of section 91(5) of
the Constitution Act, 1867 (U.K.) 30 & 31 Victoria, c. 3, by
delivering time-sensitive letters and packages exclusively within Toronto. If it is, the company’s operations are subject to the laws enacted by Parliament
and, as a federal undertaking or business within the meaning of section 2 of
the Canada Labour Code, R.S.C 1985, c. L-2 (Code), the Code applies to
its labour relations. However, if the company is not providing “Postal
Service”, it is a local undertaking under section 92(10) of the Constitution
Act, 1867, and the laws of Ontario regulate its labour relations.
[2]
This
question arises from an application for judicial review by an employer,
TurnAround Couriers Inc. (TurnAround), to set aside a decision of the Canada
Industrial Relations Board (Board), dated October 18, 2010 (2010 CIRB 544).
[3]
In
that decision, the Board held that TurnAround was providing a postal service
within the meaning of section 91(5) and that its operations therefore fell
within the competence of Parliament. As a result, the Board had jurisdiction
under the Code to certify the Canadian Union of Postal Workers (CUPW) as the
sole bargaining agent for TurnAround’s employees.
[4]
Canada
Post Corporation (CPC) and the Attorney General of Ontario intervened in
support of TurnAround’s application, which CUPW, the respondent, opposes.
[5]
There
is almost no judicial authority, or academic commentary, on the meaning and
application of section 91(5), which provides as follows:
91. It shall be lawful for the
Queen, by and with the Advice and Consent of the Senate and House of Commons,
to make Laws for the Peace, Order, and good Government of Canada, in relation
to all Matters not coming within the Classes of Subjects by this Act assigned
exclusively to the Legislatures of the Provinces; and for greater Certainty,
but not so as to restrict the Generality of the foregoing Terms of this
Section, it is hereby declared that (notwithstanding anything in this Act)
the exclusive Legislative Authority of the Parliament of Canada extends to
all Matters coming within the Classes of Subjects next hereinafter
enumerated; that is to say,
…
5.
Postal
service
…
And any Matter coming within
any of the Classes of Subjects enumerated in this Section shall not be deemed
to come within the Class of Matters of a local or private Nature comprised in
the Enumeration of the Classes of Subjects by this Act assigned exclusively
to the Legislatures of the Provinces.
|
91. Il sera loisible à la
Reine, de l'avis et du consentement du Sénat et de la Chambre des Communes,
de faire des lois pour la paix, l'ordre et le bon gouvernement du Canada,
relativement à toutes les matières ne tombant pas dans les catégories de
sujets par la présente loi exclusivement assignés aux législatures des
provinces; mais, pour plus de garantie, sans toutefois restreindre la
généralité des termes ci-haut employés dans le présent article, il est par la
présente déclaré que (nonobstant toute disposition contraire énoncée dans la
présente loi) l'autorité législative exclusive du parlement du Canada s'étend
à toutes les matières tombant dans les catégories de sujets ci-dessous
énumérés, savoir :
[…]
5.
Le
service postal
[…]
Et aucune des matières énoncées
dans les catégories de sujets énumérés dans le présent article ne sera
réputée tomber dans la catégorie des matières d'une nature locale ou privée
comprises dans l'énumération des catégories de sujets exclusivement assignés
par la présente loi aux législatures des provinces.
|
[6]
For
the reasons that follow, I do not agree that TurnAround’s operations constitute
“Postal Service” for the purpose of section 91(5), the only head of federal
power that could apply to the present facts. Rather, they are a local
undertaking within the meaning of section 92(10) of the Constitution Act,
1867, and are thus within provincial legislative competence.
[7]
Accordingly,
I would grant the application for judicial review and set aside the Board’s
decision, on the ground that the Board had no constitutional jurisdiction to
certify CUPW as the bargaining agent for TurnAround’s employees. I have
included as an Appendix to these reasons the statutory provisions to which I
refer.
Factual
background
[8]
The
relevant facts are not in dispute and can be stated briefly. TurnAround is a
for-profit corporation with a social mission: to provide “at-risk” youth with
an opportunity to turn around their lives by offering them employment as
couriers and in its office. The company also provides interest-free loans to its
employees to purchase bikes, helmets, locks, and maps, together with other
forms of assistance, including scholarships to those wishing to return to
school. Its aim is to help young people experiencing difficulties in life to
gain self-confidence and enter the mainstream economy.
[9]
At
the material time, TurnAround employed six bicycle couriers and two walkers.
Most of their pick-ups and deliveries were within the central core of Toronto. In addition, employees sometimes travelled by subway to collect or deliver mail
and packages for customers further out in the Greater Toronto Area (GTA).
TurnAround operated exclusively within Ontario.
[10]
TurnAround
generally delivered material on the same day that it was picked up. This is a
service that the CPC did not provide and was not within the terms of its
statutory monopoly. TurnAround had no contracts or any other connections with
either the CPC or an inter-provincial carrier.
[11]
On
June 8, 2010, the Board certified CUPW as the bargaining agent for a unit comprising
the couriers employed by TurnAround: Certification Order No. 9879-U. TurnAround
was self-represented at the Board hearing by its president. No one questioned
whether the Board had the constitutional jurisdiction to deal with CUPW’s
application for certification.
[12]
After
the Board certified CUPW, TurnAround retained counsel who requested the Board
to exercise its jurisdiction under section 18 of the Code to review and rescind
its order, on the ground that TurnAround’s operations were not subject to federal
law and the certification order was therefore beyond the constitutional limits
of the Board’s jurisdiction.
Decision of the
Board
[13]
Despite
objections by CUPW, the Board exercised its discretion under section 18 of the
Code to review the certification order. CUPW has not challenged this decision.
[14]
On
the basis of written submissions from the parties on the constitutional law
issue, the Board held that section 91(5) was the only possible source of
federal legislative competence over TurnAround’s operations. This was because,
unlike national and international courier companies such as FedEx and
Purolator, TurnAround operated exclusively within a province and its activities
were not integral to any inter-provincial work or undertaking. The sole
question for the Board to decide, therefore, was whether TurnAround was
providing a postal service within the meaning of section 91(5).
[15]
The
Board noted at the outset of its analysis (at para. 27) that in Reference re
Minimum Wage Act of Saskatchewan, [1948] S.C.R. 248 at 270 (Minimum Wage
Act Reference), Justice Estey had stated that “Postal Service” in section
91(5) was “a phrase of the widest import”.
[16]
Turning
to the Canada Post Corporation Act, R.S.C. 1985, c. C-10 (CPC Act), the
Board observed that section 15 limits CPC’s exclusive privilege under section
14 of collecting, transmitting, and delivering letters within Canada. In particular, paragraph 15(1)(e) provides as follows:
15. (1) The exclusive privilege
referred to in subsection 14(1) does not apply to
…
(e) letters of an urgent nature
that are transmitted by a messenger for a fee at least equal to an amount
that is three times the regular rate of postage payable for delivery in
Canada of similarly addressed letters weighing fifty grams;
…
|
15. (1) Le privilège exclusif
octroyé au paragraphe 14(1) ne s’applique pas aux documents suivants :
[…]
e) les lettres urgentes
transmises par porteur moyennant une rétribution au moins égale à trois fois
le port exigible pour la distribution au Canada de lettres de destination
comparable pesant cinquante grammes;
[…]
|
[17]
The
Board based its decision largely on this provision, and the fact that a
statutory object of the CPC is to establish and operate “a postal
service”, not the postal service (CPC Act, paragraph 5(1)(a)). It
reasoned (at para. 29) that Parliament intended that the CPC would not
necessarily be the sole provider of postal services
… and contemplated that other
enterprises could and would be involved in the provision of postal services
within the meaning of section 91(5) of the Constitution Act.
[18]
The
Board then examined the activities of TurnAround from a functional and
practical perspective, and concluded (at para. 33) that
… the pith and substance of
TurnAround’s operations is the collection, transportation and delivery, for a
fee, of small items capable of being carried by someone on foot or on a
bicycle. The items that TurnAround deals with, generally letters and small
packages, are clearly “mailable matter” within the meaning of the CPC Act.
… But for their time sensitive nature, these are items that could be carried by
CPC in the normal course of its operations.
[19]
On
the basis of the record before it, and distinguishing the few decisions (mainly
by labour boards) cited to it, the Board held (at para. 37) that
… TurnAround is engaged in
providing a postal service and thus its operations fall within the legislative
competence of the Parliament of Canada pursuant to section 91(5) of the Constitution
Act. The provisions of the Code therefore apply to TurnAround’s
operations and the Board had the requisite jurisdiction to issue Certification
Order No. 9879-U.
Issue
[20]
The
issue to be decided in this case is whether TurnAround’s business of delivering
time-sensitive material falls within federal jurisdiction over “Postal Service”
by virtue of section 91(5) of the Constitution Act, 1867.
[21]
In
a nutshell, TurnAround and the interveners argue that “Postal Service” means Canada’s national postal service, currently provided by CPC, a federal crown corporation,
and previously by the Post Office, a Department of the federal government.
Since it operates entirely within the Province of Ontario, they submit that
TurnAround is a local undertaking and, as such, its labour relations are not
regulated by the Code. CUPW, on the other hand, says that TurnAround is
providing a postal service within the meaning of section 91(5) because it is
doing something that Parliament could authorize the CPC to do as part of its
monopoly over postal service: offer a same-day local delivery service for
letters and small packages.
Analysis
(i) preliminary
matters
[22]
First,
correctness is the applicable standard of review because the principal question
before the Board involved the interpretation of section 91(5) of the Constitution
Act, 1867: Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R.
190 at para. 58. However, the findings of fact on which the Board based its
decision are entitled to deference, despite their constitutional significance: Consolidated
Fastfrate Inc. v. Western Canada Council of Teamsters, 2009 SCC 53, [2009]
3 S.C.R. 407 at para. 26 (Fastfrate). In the present case, the
accuracy of the Board’s findings of fact is not in dispute.
[23]
Second,
there is a constitutional presumption that labour relations are within
provincial legislative competence and the situations falling within federal
jurisdiction are exceptional and limited in scope: Fastfrate, paras.
27-28; NIL/TU,O Child and Family Services Society v. B.C. Government and
Service Employees’ Union, 2010 SCC 45, [2010] 2 S.C.R. 696 at para. 11 (NIL/TU,O).
(ii) the
functional test
[24]
NIL/TU,O
reminds us (at para. 3) that an analysis of whether the regulation of the
labour relations of an employer falls within federal or provincial jurisdiction
starts with
… an inquiry into the nature,
habitual activities and daily operations of the entity in question to determine
whether it constitutes a federal undertaking. This inquiry is known as the
“functional test”.
[25]
TurnAround’s
business involves the collection, transportation and delivery, for a fee, of
time-sensitive letters and small packages exclusively within the GTA. An item
is generally delivered on the same day that it is collected. TurnAround has no
connection of any kind with the CPC or any other inter-provincial delivery
service. Its “habitual activities and daily operations” are so local and
limited in nature as to suggest that TurnAround is not a federal undertaking.
[26]
Only
if these activities constitute the provision of “Postal Service” within the
meaning of section 91(5) will TurnAround’s labour relations be subject to
federal law. The parties agree that the interpretation of section 91(5) will be
determinative of the issue in dispute. Thus, if “Postal Service” in subsection
91(5) means, as TurnAround argues, the national postal service, it is clear
that the Board had no constitutional jurisdiction to grant CUPW’s certification
request.
[27]
In
the particular circumstances of this case, it is not relevant to undertake the
next step in the analytical framework established by the majority in NIL/TU,O
(at para. 3): a determination of whether the provincial regulation of
TurnAround’s labour relations would impair the “core” of the federal power with
respect to postal service. However, were such an inquiry necessary, the “core”
of Canada’s exclusive power over postal service would not, in my view, be
impaired if TurnAround’s labour relations were regulated by provincial law.
(iii) section 91(5)
(a)
jurisprudence
[28]
As
I have already indicated, the question raised in this case appears to be one of
first impression. True, both provincial labour relations boards and the Board
have assumed jurisdiction over same-day courier companies. See, for example,
decisions of the Board certifying CUPW as the bargaining agent: T.O. Turtle
Express Inc., 2010 CIRB LD 2365; L.D. J.V. Courrier Plus Inc. (2007),
Order No. 9261-U; Intelcom Courier Canada Inc. (2003), Order No. 8561-U.
And for examples of orders by provincial boards applying provincial employment
standards legislation to employees, see Globex Plus Messenger Service,
[2005] O.E.S.A.D. No. 802; Kenjak (c.o.b. Aries Courier Services) (Re),
[2005] M.L.B.D. No. 8; King (Re), [2005] B.C.E.S.T.D. No. 37. However,
it appears that in no previous case has the constitutional issue been
considered.
[29]
However,
the constitutional issue has been raised in connection with businesses
providing a delivery service under a contract with the CPC. For example, in Letter
Carriers’ Union of Canada v. Canadian Union of Postal Workers, [1975] 1
S.C.R. 178, an employer had contracted with the Post Office to deliver and
collect mail. The Court held that the labour relations of the truck drivers
employed by the employer were governed by the Canada Labour Code and
that the Labour Relations Board of Saskatchewan had exceeded its constitutional
jurisdiction when it certified the respondent union as their bargaining agent.
[30]
Similarly,
in Canada Post Corporation v. Canada Union of Postal Workers, [1988]
F.C.J. No. 37 this Court dismissed the argument that the Canada Labour
Relations Board had exceeded the constitutional limits of its jurisdiction by
finding that there had been a sale of a business when a post office operated by
the CPC in a shopping mall closed, and a new post office operated by a drug
store in the same mall opened.
[31]
The
basis of the decisions in these cases, and others like them, is that the
activities of the employers were integral to the work of either the Post
Office, or its successor the CPC, because they provided services pursuant to
contracts. Accordingly, the activities of the employers fell within section
91(5).
[32]
In
the present case, TurnAround did not deliver letters and packages in Toronto pursuant to a contractual or any other kind of relationship with the CPC.
Therefore, on the basis of the above decisions it cannot be said that
TurnAround’s operations were within federal jurisdiction. The fact that
TurnAround was providing a service that was neither provided by the CPC nor
within the scope of its statutory monopoly is not sufficient to make its
operations integral to those of the CPC.
(b) interpretation of section
91(5)
1. Errors
of the Board
[33]
In
my respectful view, the Board committed three errors in its approach to the
interpretation of section 91(5) which led it astray. First, it relied too
heavily on paragraph 5(1)(a) of the CPC Act which provides that the CPC
is to operate “a postal service”, not “the postal service”, to
support its conclusion that “Postal Service” in section 91(5) was not
necessarily limited to the services provided by the CPC.
[34]
The
provisions of legislation enacted under the head of power in question provide
no more than context that may shed some light on what the drafters of the
Constitution intended. The terms of the Post Office Act, 1867, 31 Vic.
c. 10, enacted soon after Confederation, are more relevant to
determining the meaning of section 91(5) than the CPC Act, enacted more than a
hundred years later. Section 7 of the Post Office Act, 1867 established
a Post Office Department for the “superintendence and management of the
Postal Service of Canada”, while section 32 conferred on it, subject to some
limited exceptions, a broad “exclusive privilege” to collect, convey and
deliver letters within Canada. Furthermore, the most important text for present
purposes, section 91(5) itself, places no article, definite or indefinite,
before the relevant head of federal power, “Postal Service”.
[35]
Second,
the Board stated that the term “Postal Service” should be interpreted broadly
so as to include the postal services provided by TurnAround, because Estey J.
said in the Minimum Wage Act Reference case (at 270) that they are words
of “the widest import” Hence, they should be interpreted to include postal
services provided by entities other than the CPC.
[36]
I
do not agree. When Estey J.’s observation is read in context, it does not have
the meaning attributed to it by the Board. He said (at 270):
The phrase “Postal Service” does not appear to have
been generally used prior to Confederation, but the business of the Post Office
as then conducted, the use of the phrase “Postal business and arrangements” in
the Post Office Act (Can.22 Vict., c. 31, s. 14(16)), indicate that the
Imperial Parliament in adopting the phrase “Postal Service”, - a phrase of the
widest import – in the B.N.A. Act, s. 91(5), intended that it should be
construed as sufficiently comprehensive to include all the accommodations and
facilities provided by the Post Office.
[37]
The
issue in the Minimum Wage Act Reference was whether Saskatchewan’s
minimum wage legislation applied to an employee in the post office in Maple Creek, Saskatchewan. It was argued that the legislation applied because no analogous
federal legislation had been enacted with respect to employees of the Post
Office. The Court rejected this argument, on the ground that provincial
legislation that encroached upon the federal head of power over Postal Service
was invalid, whether or not Parliament had exercised its legislative power to
the fullest extent and dealt with the subject-matter of the provincial statute
in the federal sphere.
[38]
In
the passage quoted above, Estey J. was emphasizing the breadth of the federal
head of power under section 91(5), stating that it covers all the services and
accommodations provided by the Post Office, including, as relevant to that
case, the operation of local post offices. There is no suggestion here that the
words “Postal Service” include services provided by private companies
independently of the entity responsible for the national postal service. If
anything, the quotation supports TurnAround because Estey J. stated that
“Postal Service” in section 91(5) should be construed as referring to all the
services provided by the Post Office.
[39]
Third,
the Board seems to have thought that because paragraph 15(1)(e) of the
CPC Act exempts the delivery of urgent mail from the CPC’s monopoly, it must be
a postal service. On this reasoning, entities engaged in any of the other
activities exempted by subsection 15(1) would also be providing postal service
within the meaning of section 91(5), including the delivery of inter-office
mail (paragraph 15(1)(g)) and the service of process or a writ
(paragraph 15(1)(b)). In my view, it is inconceivable that these
activities, if conducted wholly within a province, fall under federal
legislative competence.
2. Interpretative
principles
[40]
The
interpretation of the Constitution, like that of legislation, is based on the
text, context and purpose of the provision in dispute, as well as on principles
associated particularly with constitutional interpretation, such as the “living
tree” doctrine: see generally Peter W. Hogg, Constitutional Law of Canada,
5th ed. supplemented, loose leaf (Toronto: Carswell, 2007), 15.9, 60.1 (Hogg).
[41]
Text: Not
much can be inferred from the words “Postal Service” that bears on the present
debate, although the choice of the singular form of the noun provides some
support for TurnAround’s position that there is only one postal service in Canada, not as many as there are individuals providing some of the services that the CPC
could provide.
[42]
It
might be suggested that if the drafters had intended section 91(5) to connote a
single postal service, they could have conferred legislative authority on
Parliament with respect to the Post Office. In 1851, Britain relinquished
responsibility for the postal system in Canada and it was placed in the hands
of the provinces, which operated four postal systems until 1867. As Robert
Campbell observes in The Politics of Post: Canada’s Postal System
from Public Service to Privatization (Peterborough: Broadview Press, 1994)
at 27 (The Politics of Post),
As a national concern – like
currency and customs – postal authority was assigned exclusively to the federal
government at confederation.
[43]
However,
this is not a particularly strong point for CUPW, because the federal head of
power is with respect to postal service, not the entity that delivers it.
[44]
Context: The
meaning of provisions of the Constitution is not frozen in time; their text is
to be interpreted in light of events after 1867, including major societal,
economic, and technological developments: Hogg, 15.9(f), 60.1(e),
(f). However, as noted above, the historical context from which the Constitution
Act, 1867 emerged may assist in its interpretation.
[45]
It
may be inferred that the drafters of the Constitution Act, 1867 intended
“Postal Service” in section 91(5) to be the national postal system, which, in
the same year, Parliament created the Dominion Post Office to administer.
Replacing the four postal systems previously operated by the provinces with a
single national system would facilitate the delivery of mail beyond provincial
boundaries,
[46]
A
helpful summary of the history of the postal service in Canada, as well as the organization of a world postal service, is provided in the affidavit
of Dr Robert Campbell, a political scientist and public policy analyst
specializing in postal economics and policy: see CPC’s Application Record, pp.
7-28; and The Politics of Post, chaps. 1 and 2. What follows is taken
largely from that affidavit and is not controversial. Dr Campbell’s affidavit
describes the essential characteristics of the postal service throughout its
history in Canada, as well as in other countries: CPC’s Application Record, pp.
21-22. They include the following.
[47]
First,
the service is universal and available to all. In other words, the CPC must
collect mail from anywhere in Canada and deliver it to any address in Canada, and must accept any items up to a certain weight that customers want to have
delivered.
[48]
Second,
the service is affordable by all. In particular, the cost of the service does
not depend on the remoteness of the location to which mail is to be delivered.
In practice, this means that postal service in high-density areas subsidises
the service provided in areas that are less populated and further removed from
the major conurbations.
[49]
Third,
the service requires a national operational network in order to discharge the
obligations of universal service, availability, and affordability. The network
includes post offices and sorting plants, a national system of addresses and
postal codes, and a payment system (generally a system of prepayment through
the sender’s purchase of the necessary stamps).
[50]
Fourth,
the postal service must be operated or regulated by a national, governmental
entity in order to ensure that the necessary requirements of a national service
are in place and the network supporting it is working properly. Currently, the
CPC, a Crown corporation, performs this role. Even if Parliament decided to
turn the operational functions of the CPC over to one or more commercial
corporations, a public authority would still be required to regulate the
service in order to ensure that it retained the defining attributes of a
national postal service, thereby discharging Canada’s international
obligations.
[51]
Fifth,
in order to facilitate the international transmission and delivery of mail, the
Treaty of Bern of 1874 established the General Postal Union, subsequently
called the Universal Postal Union (UPU).
The UPU’s formation integrated a
series of national postal services into one coherent and remarkably efficient
and effective international postal service.
(Campbell affidavit,
CPC’s Application Record, p. 17).
The UPU is now an agency of the
United Nations. Only a national service can discharge Canada’s international obligation to meet the postal service standards established by the
UPU.
[52]
It
hardly needs saying that TurnAround has none of these characteristics of a
postal service.
[53]
Purposes: The
purposes served by section 91(5) in conferring exclusive legislative competence
on Canada with respect to “Postal Service” are to be found largely in the
characteristics described above. A national postal service was a necessity for
the economic development of Canada, and performed an important nation-building
role: see CPC’s Application Record, pp. 44-49; The Politics of Post, at
27-32. These purposes could only be achieved by vesting the necessary
legislative authority in the federal Parliament.
3. Application
to this case
[54]
The
considerations examined above in my opinion indicate that “Postal Service” in
section 91(5) refers to the national delivery system, which is currently either
operated directly by the CPC or managed by it through contracts with other entities.
[55]
In
addition, this interpretation is easy to apply and, unlike the position
advanced by CUPW, does not require a case-by-case analysis to determine how
much of a courier’s business is devoted to the collection and delivery of
mailable material, and how much to other items. Thus, for example, in Critical
Path Couriers Ltd. (Re), 2011 CIRB 604 at para, 20, the Board
distinguished its decision in the present case on the ground that, unlike
TurnAround, Critical Path specialized in the delivery of material that, because
of it size or nature, was not mailable.
[56]
The
achievement of predictability and certainty are important goals in
constitutional interpretation. Hence, whenever possible, courts should avoid
interpretations that require decision-makers “to splice and dice discrete
differences among companies”: Fastfrate at para. 46.
Conclusions
[57]
For
these reasons, I would grant the application for judicial review with costs to
TurnAround, set aside the Board’s decision, and quash Certification Order No.
9879-U on the ground that it was beyond the constitutional jurisdiction of the
Board.
“John
M. Evans”
“I
agree
Pierre
Blais C.J.”
“I
agree
K.
Sharlow J.A.”