Date:
20090526
Dockets: A-492-06
A-499-06
Citation: 2009 FCA 166
CORAM: DESJARDINS
J.A.
NOËL
J.A.
PELLETIER
J.A.
BETWEEN:
THE MINISTER OF
HEALTH
Appellant/ Respondent
to Cross-appeal
and
MERCK FROSST CANADA LTD.
Respondent/Appellant
by Cross-appeal
REASONS FOR JUDGMENT
DESJARDINS J.A.
[1]
The Court has before it two appeals and two cross-appeals. The appeals are brought by the Minister of Health and the
cross-appeals, by Merck Frosst Canada Ltd. (Merck Frosst).
[2]
The appeal and the cross-appeal in the principal appeal file,
A-492-06 (T-90-01), are from the judgment by a Federal Court judge (the trial
judge) in Merck Frosst Canada Ltd. v. Canada (Minister of Health), 2006
FC 1201.
[3]
The appeal and cross-appeal in the companion appeal file, A-499-06
(T-36-02), are from the judgment by the same judge in Merck Frosst Canada
Ltd. v. Canada (Minister of Health), 2006 FC 1200.
[4]
In both of those cases, the trial judge had before him two
applications for judicial review under section 44 of the Access to
Information Act, R.S.C. 1985, c. A-1 (the Act). Those applications were filed against two decisions by the appellant
(the Minister or Health Canada) under
section 28 of the Act, namely those made on January 2, 2001 (appeal A-492-06)
and December 19, 2001 (appeal A-499-06). The decisions were made in response to two access to information
requests received by the Minister from a requestor third party—in this case, a
competitor of Merck Frosst—pursuant to section 4 of the Act.
[5]
In the first case (appeal file A-492-06), the Minister’s decision
pertained to the disclosure of records concerning the New Drug Submission (NDS)
for Singulair® (Singulair), a drug developed by Merck Frosst for the treatment
of asthma.
In the second case (appeal file A-499-06), the
Minister’s decision concerned the disclosure of records pertaining to a
Supplemental New Drug Submission (SNDS) for Singulair® (Singulair), a drug
developed by Merck Frosst for the treatment of asthma in children aged two to
five years.
[6]
The access requestor’s request in appeal file A-492-06 was for the
following records:
Notice of Compliance,
Comprehensive Summary, Reviewer’s Notes and any correspondence between Health Canada and Merck Frosst regarding
the review of the New Drug Submission for SINGULAIR® Tablets and Chewable
Tablets.
[7]
The requestor’s request for access in appeal file A-499-06 was for
the following records:
All reasonable information on
4 mg SINGULAIR® which was filed as a Supplemental New Drug Submission,
including correspondence and the reviewer’s notes.
[8]
The reasons for this judgment dispose jointly of both appeals,
A-492-06 and A-499-06. These reasons for judgment will be placed in both appeal
files.
Separate judgments will be placed in each file.
FACTS
[9]
The
facts are undisputed. In appeal file A-492-06, they
are found at paragraphs 3 to 21 of the trial judge’s reasons and in appeal file
A-499-06, at paragraphs 3 to 28 of the trial judge’s reasons. These decisions appear in the law reports, as indicated
above.
[10]
In appeal file A-492-06, the Minister, after considering section
20 of the Act, disclosed approximately 20 pages of records on August 16, 2000,
to the party requesting access, without giving Merck Frosst notice pursuant to
section 27 of the Act, the Minister being satisfied that no exception applied
to those pages.
[11]
Also on that date, the Minister decided to refuse to disclose
another part of the records. However, the Minister
sent Merck Frosst a notice, under section 27, of his intention to disclose
pages 1-330, 333-337, 341-375, 379-447, 449-496, 500-524, 526, 527 and 529-547
of the records requested by the access requestor. The Minister asked that within 20 days after that notice
was sent, Merck Frosst send it representations setting out the grounds justifying
non-disclosure of the record or part thereof pursuant to subsection 20(1) of
the Act.
[12]
Merck Frosst obtained an extension of time to respond until
September 25, 2000.
[13]
In a letter dated September 25, 2000, Merck Frost responded to the
Minister’s notice from August 16, 2000, with a letter of approximately 10 pages
setting forth its objections to the disclosure of information on the pages
stated in the notice. In particular, Merck
Frosst objected to the disclosure of general categories of information, such as
manufacturing techniques, chemistry, dates, controls and file numbers. Merck Frosst also objected to the disclosure of the
approximately 20 pages that had already been sent, without notice, to the third
party.
[14]
On January 2, 2000, the Minister gave Merck Frost notice under
subsection 28(3) of the Act of its decision to disclose certain records. Attached to that notice was Appendix “J” to the affidavit
of Margery Snider from Health Canada. (Said appendix contained pages 1-23, 26-35, 45-50, 52-59,
61-71, 74-84, 87-104, 111-125, 135-208, 210, 212, 213, 216-220, 222-330,
333-337, 341-387, 389-447, 449-463, 467-496, 500-527, 529-534, 536-544 and 547
of the requested records). The documentation accompanying
that notice thus comprised 335 pages on which information was marked for
deletion further to Merck Frosst’s representations received at that date (A.B.,
Vol. XXI, page 5159, paragraph 31 and page 5263).
[15]
On January 9, 2001, Merck Frosst filed an application for judicial
review with the Federal Court.
[16]
On September 26, 2001, Margery Snider filed a second affidavit
including Appendix “Q”, which contained an even more heavily pared down version
of the records that were the subject of the Margery Snider’s Appendix “J” from
January 2, 2001 (A.B., Vol. XXI, page 5193, paragraphs 91-95 and Vol.
XXIII, page 6368). This version
therefore dates from after Merck Frosst instituted the review proceedings.
[17]
In appeal file A-499-06, the Minister, after reviewing section 20
of the Act, sent eight pages of records on June 11, 2001, to the party
requesting access, without giving Merck Frost notice pursuant to section 27 of
the Act, the Minister being satisfied that no exception applied to those pages.
[18]
On December 19, 2001, the Minister gave Merck Frost notice, under
section 28 of the Act, of its decision to disclose the records it had deleted
further to Merck Frosst’s representations.
[19]
On January 8, 2002, Merck Frosst filed an application for judicial
review with the Federal Court.
[20]
On July 17, 2002, Margery Snider filed an affidavit containing the
deleted records. Only the following pages of the
document reproduced at Exhibit “U” of that affidavit remain in dispute, namely
pages 7-16, 24-33, 35, 39-42, 43-46, 48-54, 57, 105-115, 119-121, 137-167,
187-188, 194-198, 200, 202, 204-246 and 296.
ISSUES
[21]
There are two types of issues: those relating to the Minister’s
appeals and those relating to the cross-appeals by Merck Frosst. Overall, these issues concern the interpretation and
application of sections 20, 25, 27, 28, 44 and 51 of the Act.
[22]
The following issues are raised in the Minster’s appeals:
(a) Did
the trial judge err in law in concluding that a government institution cannot
disclose information to an access requestor unless the third party (in this
case, Merck Frosst) has been given prior notice by the government institution?
(b)
Did the trial judge err in fact and law in applying the exceptions
provided at paragraphs 20(1)(a), (b) and (c) of the Act to
the facts of the case?
(c) Did the
trial judge err in fact and law in applying section 25 of the Act?
[23]
The following issues are raised in Merck Frosst’s cross-appeals:
(a) Is
Merck Frosst entitled to obtain a declaration with regard to the lawfulness of
the government institution’s disclosing its records to an access requestor
without first notifying Merck Frosst?
(b) Did
the trial judge err in ruling in favour of the validity of the government
institution’s procedure whereby the onus to establish that the Minister must
refuse the disclosure of a record is on the party objecting to disclosure?
(c) Did
the trial judge err in fact and law in applying the exceptions provided at
paragraphs 20(1)(a), (b) and (c) of the Act to the facts
of the case?
[24]
Each issue will be dealt with according to its rank. However, since they are related, issue (a) from Merck
Frosst’s cross-appeal will be dealt with immediately after issue (a) from the
Minister’s appeal. As well, issue (b) from the
Minister’s appeal and issue (c) from Merck Frosst’s cross-appeal will be
addressed together, owing to their related nature.
APPLICABLE
STANDARDS OF REVIEW
[25]
The usual rules applicable to the appellate review of a
subordinate court, as set forth in Dr. Q v. College of Physicians and
Surgeons of British Columbia, [2003] 1 S.C.R. 226, paragraph 43, and Housen
v. Nikolaisen, [2002] 2 S.C.R. 235, paragraphs 27-28, apply in this case. Questions of law are decided
on a standard of correctness. However, this
Court will only intervene on questions of fact or questions of mixed fact and
law if there is a palpable and overriding error. If a pure error of law is extricated from a mixed question of fact and
law, the question of law thus isolated is decided according to the standard of
correctness (Housen v. Nikolaisen, loc. cit., paragraph 31).
APPLICABLE STATUTORY PROVISIONS
[26]
The applicable provisions from the Act are reproduced as they read
when the events giving rise to this dispute unfolded:
2.
(1) The purpose of this Act is to extend the present laws of Canada to
provide a right of access to information in records under the control of a
government institution in accordance with the principles that government
information should be available to the public, that necessary exceptions to
the right of access should be limited and specific and that decisions on the
disclosure of government information should be reviewed independently of
government.
. . .
4.
(1) Subject to this Act, but notwithstanding any other Act of Parliament,
every person who is
(a)
a Canadian citizen, or
(b)
a permanent resident within the meaning of subsection 2(1) of the Immigration
and Refugee Protection Act,
has
a right to and shall, on request, be given access to any record under the
control of a government institution.
. . .
20.
(1) Subject to this section, the head of a government institution shall
refuse to disclose any record requested under this Act that contains
(a)
trade secrets of a third party;
(b)
financial, commercial, scientific or technical information that is
confidential information supplied to a government institution by a third
party and is treated consistently in a confidential manner by the third
party;
(c)
information the disclosure of which could reasonably be expected to result in
material financial loss or gain to, or could reasonably be expected to
prejudice the competitive position of, a third party; or
(d)
information the disclosure of which could reasonably be expected to interfere
with contractual or other negotiations of a third party.
. . .
|
2.
(1) La présente loi a pour objet d’élargir l’accès aux documents de
l’administration fédérale en consacrant le principe du droit du public à leur
communication, les exceptions indispensables à ce droit étant précises et
limitées et les décisions quant à la communication étant susceptibles de
recours indépendants du pouvoir exécutif.
[. . .]
4.
(1) Sous réserve des autres dispositions de la présente loi mais nonobstant
toute autre loi fédérale, ont droit à l’accès aux documents relevant d’une
institution fédérale et peuvent se les faire communiquer sur demande :
a)
les citoyens canadiens;
b)
les résidents permanents au sens du paragraphe 2(1) de la Loi sur
l’immigration et la protection des réfugiés.
[. . .]
20.
(1) Le responsable d’une institution fédérale est tenu, sous réserve des
autres dispositions du présent article, de refuser la communication de
documents contenant :
a)
des secrets industriels de tiers;
b)
des renseignements financiers, commerciaux, scientifiques ou techniques
fournis à une institution fédérale par un tiers, qui sont de nature confidentielle
et qui sont traités comme tels de façon constante par ce tiers;
c)
des renseignements dont la divulgation risquerait vraisemblablement de causer
des pertes ou profits financiers appréciables à un tiers ou de nuire à sa
compétitivité;
d)
des renseignements dont la divulgation risquerait vraisemblablement
d’entraver des négociations menées par un tiers en vue de contrats ou à
d’autres fins.
[. . .]
|
25.
Notwithstanding any other provision of this Act, where a request is made to a
government institution for access to a record that the head of the
institution is authorized to refuse to disclose under this Act by reason of
information or other material contained in the record, the head of the
institution shall disclose any part of the record that does not contain, and
can reasonably be severed from any part that contains, any such information
or material.
. . .
|
25.
Le responsable d’une institution fédérale, dans les cas où il pourrait, vu la
nature des renseignements contenus dans le document demandé, s’autoriser de
la présente loi pour refuser la communication du document, est cependant
tenu, nonobstant les autres dispositions de la présente loi, d’en communiquer
les parties dépourvues des renseignements en cause, à condition que le
prélèvement de ces parties ne pose pas de problèmes sérieux.
[. . .]
|
27.
(1) Where the head of a government institution intends to disclose any record
requested under this Act, or any part thereof, that contains or that the head
of the institution has reason to believe might contain
a)
trade secrets of a third party,
(b)
information described in paragraph 20(1)(b) that was supplied by a third
party, or
(c)
information the disclosure of which the head of the institution could
reasonably foresee might effect a result described in paragraph 20(1)(c) or
(d) in respect of a third party,
The
head of the institution shall, subject to subsection (2), if the third party
can reasonably be located, within thirty days after the request is received,
give written notice to the third party of the request and of the fact that
the head of the institution intends to disclose the record of part thereof.
(2)
Any third party to whom a notice is required to be given under subsection (1)
in respect of an intended disclosure may waive the requirement, and where the
third party has consented to the disclosure the third party shall be deemed
to have waived the requirement.
(3)
A notice given under subsection (1) shall include
(a)
a statement that the head of the government institution giving the notice
intends to release a record or a part thereof that might contain material or
information described in subsection (1);
(b)
a description of the contents of the record or part thereof that, as the
case may be, belong to, were supplied by or relate to the third party to whom
the notice is given; and
(c)
a statement that the third party may, within twenty days after the notice is
given, make representations to the head of the government institution that
has control of the record as to why the record or part thereof should not be
disclosed.
28.
(1) Where a notice is given
by
the head of a government
institution
under subsection
27(1)
to a third party in respect
of
a record or a part thereof,
(a)
the third party shall, within
twenty
days after the notice is
given,
be given the opportunity
to
make representations to the
head
of the institution as to why
the
record or the part thereof
should
not be disclosed; and
(b)
the head of the institution
shall,
within thirty days after
the
notice is given, if the third
party
has been given an
opportunity
to make
representations
under paragraph
(a),
make a decision as to
whether
or not to disclose the
record
or the part thereof and
give
written notice of the
decision
to the third party.
(2)
Representations made by a
third
party under paragraph
(1)(a)
shall be made in writing
unless
the head of the
government
institution
concerned
waives that
requirement,
in which case they
may
be made orally.
(3)
A notice given under
paragraph
(1)(b) of a decision
to
disclose a record requested
under
this Act or a part thereof
shall
include
(a)
a statement that the third
party
to whom the notice is
given
is entitled to request a
review
of the decision under
section
44 within twenty days
after
the notice is given; and
(b)
a statement that the person
who
requested access to the
record
will be given access
thereto
or to the part thereof
unless,
within twenty days after
the
notice is given, a review of
the
decision is requested under
section
44.
(4)
Where, pursuant to
paragraph
(1)(b), the head of a
government
institution decides
to
disclose a record requested
under
this Act or a part thereof,
the
head of the institution shall
give
the person who made the
request
access to the record or
the
part thereof forthwith on
completion
of twenty days after
a
notice is given under that
paragraph,
unless a review of
the
decision is requested under
section
44.
44.
(1) Any third party to whom
the
head of a government
institution
is required under
paragraph
28(1)(b) or
subsection
29(1) to give a
notice
of a decision to disclose
a
record or a part thereof under
this
Act may, within twenty
days
after the notice is given,
apply
to the Court for a review
of
the matter.
. . .
51.
Where the Court
determines,
after considering an
application
under section 44,
that
the head of a government
institution
is required to refuse
to
disclose a record or part of a
record,
the Court shall order the
head
of the institution not to
disclose
the record or part
thereof
or shall make such other
order
as the Court deems
appropriate.
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27.
(1) Sous réserve du paragraphe (2), le responsable d’une institution fédérale
qui a l’intention de donner communication totale ou partielle d’un document
est tenu de donner au tiers intéressé, dans les trente jours suivant la
réception de la demande, avis écrit de celle-ci ainsi que de son intention,
si le document contient ou s’il est, selon lui, susceptible de
contenir :
a)
soit des secrets industriels d’un tiers;
b)
soit des renseignements visés à l’alinéa 20(1)b) qui ont été fournis par le
tiers;
c)
soit des renseignements dont la communication risquerait, selon lui,
d’entraîner pour le tiers les conséquences visées aux alinéas 20(1) c) ou d).
La
présente disposition ne vaut que s’il est possible de rejoindre le tiers sans
problèmes sérieux.
(2)
Le tiers peut renoncer à l’avis prévu au paragraphe (1) et tout consentement
à la communication du document vaut renonciation à l’avis.
(3)
L’avis prévu au paragraphe (1) doit contenir les éléments suivants :
a)
la mention de l’intention du responsable de l’institution fédérale de donner
communication totale ou partielle du document susceptible de contenir les
secrets ou les renseignements visés au paragraphe (1);
b)
la désignation du contenu total ou partiel du document qui, selon le cas,
appartient au tiers, a été fourni par lui ou le concerne;
c)
la mention du droit du tiers de présenter au responsable de l’institution
fédérale de qui relève le document ses observations quant aux raisons qui
justifieraient un refus de communication totale ou partielle, dans les vingt
jours suivant la transmission de l’avis.
28.
(1) Dans les cas où il a
donné
avis au tiers
conformément
au paragraphe
27(1),
le responsable d’une
institution
fédérale est tenu :
a)
de donner au tiers la
possibilité
de lui présenter, dans
les
vingt jours suivant la
transmission
de l’avis, des
observations
sur les raisons qui
justifieraient
un refus de
communication
totale ou
partielle
du document;
b)
de prendre dans les trente
jours
suivant la transmission de
l’avis,
pourvu qu’il ait donné au
tiers
la possibilité de présenter
des
observations conformément
à
l’alinéa a), une décision quant
à
la communication totale ou
partielle
du document et de
donner
avis de sa décision au
tiers.
(2)
Les observations prévues à
l’alinéa
(1)a) se font par écrit,
sauf
autorisation du responsable
de
l’institution fédérale quant à
une
présentation orale.
(3)
L’avis d’une décision de
donner
communication totale
ou
partielle d’un document
conformément
à l’alinéa (1)b)
doit
contenir les éléments
suivants
:
a)
la mention du droit du tiers
d’exercer
un recours en révision
en
vertu de l’article 44, dans les
vingt
jours suivant la
transmission
de l’avis;
b)
la mention qu’à défaut de
l’exercice
du recours en
révision
dans ce délai, la
personne
qui a fait la demande
recevra
communication totale
ou
partielle du document.
(4)
Dans les cas où il décide, en
vertu
de l’alinéa (1)b), de
donner
communication totale
ou
partielle du document à la
personne
qui en a fait la
demande,
le responsable de
l’institution
fédérale donne
suite
à sa décision dès
l’expiration
des vingt jours
suivant
la transmission de l’avis
prévu
à cet alinéa, sauf si un
recours
en révision a été exercé
en
vertu de l’article 44.
44.
(1) Le tiers que le
responsable
d’une institution
fédérale
est tenu, en vertu de
l’alinéa
28(1)b) ou du
paragraphe
29(1), d’aviser de la
communication
totale ou
partielle
d’un document peut,
dans
les vingt jours suivant la
transmission
de l’avis, exercer
un
recours en révision devant la
Cour.
[. . .]
51.
La Cour, dans les cas où
elle
conclut, lors d’un recours
exercé
en vertu de l’article 44,
que
le responsable d’une
institution
fédérale est tenu de
refuser
la communication totale
ou
partielle d’un document, lui
ordonne
de refuser cette
communication;
elle rend une
autre
ordonnance si elle
l’estime
indiqué.
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ANALYSIS
[27]
A preliminary observation must be made.
[28]
At paragraph 56 of its memorandum, Merck Frosst was quick to cite
not only the provisions of the Act but also Canada’s international
agreements—namely the North American Free Trade Agreement (NAFTA) and
the Agreement on Trade-Related Aspects of Intellectual Property Rights
(TRIPs Agreement)—the Treasury Board policy issued pursuant to paragraph 70(1)(c)
of the Act, Health Canada’s internal policies and the principles underlying the
duty of fairness.
[29]
However, none of this, except for the Act and procedural fairness,
was argued before the trial judge (see Merck Frosst’s application for judicial
review, public A.B., Vol. I, page 47). The trial judge focused on the Act in question, with one exception. In
appeal A-492-06, he mentioned the Treasury Board’s policy at paragraph 69 of
his reasons when summarizing the respondent’s arguments but did not dispose of
that argument.
[30]
The standard of review can only be applied and the appeals decided
on the basis of the Act at issue. For one thing,
the trial judge cannot be criticized for errors on issues that were not brought
to his attention. For another, the appellant
cannot remake its case on appeal.
Issue (a) from the Minister’s
appeal: Did the trial judge err in law in concluding that a government
institution cannot disclose information to an access requestor unless the third
party (in this case, Merck Frosst) has been given prior notice by the
government institution?
[31]
Merck Frosst objects to the decisions made on August 16, 2000, (in
appeal file A-492-06) and June 11, 2001, (in appeal file A-499-06) pursuant to
which the Minister disclosed records to the access requestor without giving
prior notice to the “third party”—in this case, Merck Frosst.
[32]
The Minister alleges that, on the contrary, subsection 27(1) of
the Act does not require the head of a government institution to contact the
“third party” unless the record contains or the head of the institution has
reason to believe it might contain information
protected by subsection 20(1) of the Act.
[33]
The trial judge ruled on this point at paragraphs 63 and 64 of his
reasons (in appeal file A-492-06) and at paragraphs 71 and 72 (in appeal file
A-499-06):
In the opinion of this Court, it is
irrelevant that the records disclosed without prior notice are not subject to
subsection 20(1) of the Act. The interpretation advocated by the respondent
would give the respondent a power to determine subsection 20(1) applicability
that would be sheltered from any judicial supervision and could cause
irreparable harm to third parties affected by access requests.
This Court therefore finds that
the disclosure of records by the respondent without prior notice contravened
the spirit of subsection 20(1) of the Act. Since this procedure could cause
irreparable harm to a third party concerned, such as the applicant, if the
respondent erred in concluding that subsection 20(1) did not apply to these
records, the disclosure without prior notice should not have taken place.
[Emphasis
added.]
[34]
The language of subsection 27(1) of the Act requires the head of a
government institution to contact the “third party” only if the record contains
or the head of the institution has reason to believe it might contain secrets
or information described in paragraph 27(1) of the Act. Paragraph 27(1) of the Act then refers to the trade secrets of a
third party, information described in paragraph 20(1)(b) that was
supplied by a third party and information the disclosure of which the head of
the government institution could reasonably foresee might effect a result
described in paragraph 20(1)(c) or (d) in respect of a third
party.
[35]
In Rizzo & Rizzo Shoes Ltd. (Re),
[1998] 1 S.C.R. 27, Justice Iacobucci called to mind Elmer Driedger’s
statements in Construction of Statutes (2d ed. 1983) according to which
there is currently only one principle or approach:
[T]he words of
an Act are 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.
[36]
The object of the Act, as stated at
section 2, is to “extend the present laws of Canada
to provide a right of access to information in records under the control of a
government institution in accordance with the principles that government
information should be available to the public”.
[37]
In Rubin v. Canada (Minister of Transport), [1998] 2 F.C.
430, Justice McDonald, writing for the Court, explained at paragraph 23 of his
reasons the effect of section 2 of the Act:
23 In my opinion, therefore, all exemptions must be
interpreted in light of this clause. That is, all exemptions to access must be
limited and specific. This means that where there are two interpretations open
to the Court, it must, given Parliament’s stated intention, choose the one that
infringes on the public’s right to access the least. It is only in this way
that the purpose of the Act can be achieved. It follows that an interpretation
of an exemption that allows the government to withhold information from public
scrutiny weakens the stated purpose of the Act.
[38]
In the landmark case Air Atonabee Ltd. v. Canada (Minister of
Transport), [1989] F.C.J. No. 453, Justice MacKay of the Federal Court
concluded as follows regarding the duty of the head of a government institution
pursuant to section 28 of the Act at that time, now section 27:
11 The Act precludes disclosure of
various types of information as specifically defined and also authorizes
refusal to disclose information in certain other defined cases. In relation to
third party information, that is information relating to a party other than the
requestor or a government agency, which is not otherwise exempt, the Access
to Information Act exempts from disclosure only certain kinds of
information as defined in section 20, the relevant parts of which for purposes
of this case are:
. . .
The Act provides for intervention and an opportunity for
representations by a third party, not in all cases but in certain cases, as
follows. . . .
12 It may be worth stressing in passing that the
Act does not require notice to a third party before disclosure of information
relating to that party except in the circumstances set out in section 28(1).
Where the head of the institution considering all the relevant evidence before
her or him concludes that the information requested is not of a character
referred to in that section, notice to the third party is not required, will
not be ordered by the Court and no right to apply for review under section
44(1) accrues. (See Sawridge Indian Band v. Canada (Minister of
Indian Affairs and Northern Development) (1987), 10 F.T.R. 48, aff’d sub
nom. Twinn v. Minister of Indian Affairs and Northern Development
(1987), 80 N.R. 263 (F.C.A.)).
[Emphasis added.]
[39]
The trial judge ignored this case law and therefore erred in law
at paragraph 64 of the reasons for judgment in A-492-06 and at paragraph 72 of
the reasons for judgment in A-499-06.
Issue (a) from Merck Frosst’s
cross-appeal: Is Merck Frosst entitled to obtain a declaration with regard to
the lawfulness of the government institution’s disclosing its records to an
access requestor without first notifying Merck Frosst?
[40]
At paragraphs 44 and 64 of his reasons in appeal file A-492-06,
and at paragraphs 52 and 62 of his reasons in appeal file A-499-06, the trial
judge concluded that Merck Frosst is entitled to obtain a declaratory order
with regard to the lawfulness of the disclosures of records without prior
notice on August 16, 2000, and June 11, 2001. However, the formal judgment delivered by the Federal Court did not
contain a declaration.
[41]
In light of my findings on the preceding issue, it follows that
Merck Frosst cannot obtain a declaration regarding the lawfulness of the
government institution’s disclosing the disclosed records without prior notice.
Issues (b) from the Minister’s appeal
and (c) from Merck Frosst’s
cross-appeal: Did the trial judge err in fact and law in applying the
exceptions provided at paragraphs 20(1)(a), (b) and (c) of the Act to the facts of
the case?
Paragraph
20(1)(a)
[42]
In
appeal A‑492‑06, the trial judge made the following conclusion at
paragraph 105 of his reasons:
105 Disclosure of pages
462 to 493, 495, and 518 to 521 should be refused under paragraph 20(1)(a)
of the Act since these pages contain information that constitutes a trade
secret.
[Emphasis
added.]
[43]
However,
appeal file A-490-06 does not contain any specific conclusion relating to paragraph
20(1)(a) of the Act.
[44]
The Minister submits that the trial judge erred in neglecting to
state which legal test he used to conclude that paragraph 20(1)(a)
applies to the 33 pages of records listed.
[45]
The Minister also submits that the judge presented no analysis in
support of his decision to exclude these pages and that the respondent did not
provide any objective and specific evidence allowing the judge to conclude as
he did.
[46]
Merck Frosst simply contends that the trial judge had all of the
evidence before him and that he correctly decided that the pages contained
trade secrets and should be excluded under paragraph 20(1)(a) of the
Act.
[47]
In its memorandum, Merck Frosst filed summary tables of its
evidence in support of its claim that the excluded pages contain trade secrets. These tables refer to affidavits filed on June 1, 2001, by
experts hired by Merck Frosst—amongst others, Robert Sarrazin and Annie Tougas.
[48]
In his affidavit dated June 1, 2001, Mr. Sarrazin writes the
following in respect of pages 462-493, 495 and 518-512 (A.B., Vol. XXXII,
page 8510):
[translation]
170. Pages 461 to 547
pertain to the review of the summary of chemical and galenical research. This information deals with—and repeats—the information
provided by Merck Frosst for the NDS. These
pages contain information that constitutes the trade secrets in their
fundamental components: specifically, the manufacture, analysis, control and
specifications of the active substance and the final product. These details are particularly sought-after by generic
competitors to develop their own product.
[49]
Mr. Sarrazin goes on to briefly describe the contents of the
relevant pages, after which he reiterates that they constitute a trade secret. He then makes several references to the statement at paragraph
170 of his affidavit (A.B., Vol. XXXII, page 8510):
[translation]
175. At page
470, a table indicates the number of known impurities in Merck Frosst’s raw
material and the acceptable limits.
176. That
constitutes a trade secret. I reiterate my comments
at paragraph 170 on this subject.
177. This
information deals with—and repeats—the information provided by Merck Frosst for
the NDS.
This is scientific or technical information (from
Merck Frosst) that presents a likely risk of significant commercial or
financial repercussions. Innovative
companies, including Merck Frosst, generally treat this type of information as
confidential.
[Emphasis
added.]
[50]
In her affidavit dated June 1, 2001, Annie Tougas states the
following (A.B., Vol. III, page 179):
96. The
specifications list the major product criteria (such as pages 470-71, 475-477,
482-483, 520-521 of the Records) and the limits to be met for ensuring product
quality and consistency. Batches are released on the Canadian market according
to the specifications. They are usually based on critical parameters
(such as pages 475-476, 481-483, 520-521 of the Records) and if released, it
would provide information on the specific parameters (such as pages 475, 481,
485-487 of the Records) subject or release and/or stability control. . . . Besides
the confidentiality and prejudicial impacts of any unwarranted disclosure of
the information, the said information lies at the core of what constitutes a
trade secret.
[Emphasis
added.]
[51]
Thus, Merck Frosst’s affiants provided general statements and made
copious references to information that had already been deleted, in the
September 26, 2001, Appendix “Q”, from the records that the Minister intends to
send to the access requestor.
[52]
However, in Société Gamma Inc. v. Canada (Department of
Secretary of State), [1994] F.C.J. No. 589, cited by this Court in Canada
(Information Commissioner) v. Canada (Canadian Transportation Accident
Investigation and Safety Board), [2006] F.C.J. No. 704, Justice Strayer,
then of the Federal Court, found at paragraph 7 of his reasons:
. . . .
There is unfortunately no authoritative jurisprudence on what is a “trade
secret” for the purposes of the Access to Information Act. One can, I
think, conclude that in the context of subsection 20(1) trade secrets
must have a reasonably narrow interpretation since one would assume that they
do not overlap the other categories: in particular, they can be contrasted
to “commercial . . . confidential information supplied to a government
institution . . . treated consistently in a confidential manner
. . .” which is protected under paragraph (b). In respect of
neither (a) nor (b) is there a need for any harm to be
demonstrated from disclosure for it to be protected. There must be some
difference between a trade secret and something which is merely “confidential”
and supplied to a government institution. I am of the view that a trade
secret must be something, probably of a technical nature, which is guarded very
closely and is of such peculiar value to the owner of the trade secret that
harm to him would be presumed by its mere disclosure. . . .
[Emphasis
added.]
[53]
In
AstraZeneca Inc. v. Canada (Health), [2005]
F.C.J. No. 859, Justice Phelan of the
Federal Court echoed Justice Strayer’s remarks:
62 Strayer J. (as he then was) in Société
Gamma Inc. v. Canada (Secretary of State) (1994), 79 FTR 42 held that the
term “trade secret” is to be given a relatively narrow interpretation. A
trade secret must be something of a technical nature which is very closely
guarded and is of such peculiar value to the owner of the trade secret that
harm to him would be presumed from its mere disclosure.
63 It is not so much a question of
narrow or broad interpretation as it is determining whether the information
falls within the common law meaning of trade secret. Parliament intended to
protect genuine trade secrets.
64 Health Canada’s Access to Information Act Third Party Information Operational
Guidelines outlines the department’s view of the criteria to be met:
·
the information must be secret in an absolute or relative
sense (is known only by one or a relatively small number of persons);
·
the possessor of the information must demonstrate that he
has acted with the intention to treat the information as secret;
·
the information must be capable of industrial or commercial
application;
·
the possessor must have an interest (eg. an economic
interest) worthy of legal protection.
65
The type of information which could potentially fall into
this class includes the chemical composition of a product and the manufacturing
processes used. However, it is not every process or test which would fall into
this class particularly where such process or test is common in a particular
industry.
[Emphasis
added.]
[54]
It
is clear from these two decisions that the notion of trade secret is
interpreted in a narrow sense and that in the test used in the case law to
determine whether paragraph 21(1)(a) applies to a record’s
contents, a high threshold is applied. Anyone who relies on that provision must
necessarily furnish specific, objective and detailed evidence that the
information constitutes a trade secret.
[55]
The
trial judge’s decision contains no statements on the notion of trade secret,
the applicable legal test to characterize information as a trade secret or the
burden of proof.
[56]
Furthermore,
the affidavits relied on by Merck Frosst contain some very broad statements.
These include sentences such as [translation]
“[Disclosure of information] . . . presents a likely risk of significant
commercial or financial repercussions . . .” (paragraph 177, affidavit of
Mr. Sarrazin, cited above) and “. . . They are usually based on
critical parameters . . .” (paragraph 96, affidavit of Ms. Tougas,
cited above). [Emphasis added.]
[57]
Furthermore,
the bases for an exclusion under paragraph 20(1)(a) are entangled and
sometimes even confused with the bases required under paragraph 20(1)(b),
as evidenced by the following sentence at paragraph 177 of Mr. Sarrazin’s
affidavit, cited above: [translation]
“Innovative companies, including Merck Frosst, generally treat this type of
information as confidential. . . .”. In Société Gamma Inc., Justice
Strayer was careful to point out at paragraph 7 of his reasons, cited
above, that “[t]here must be some difference between a trade secret and
something which is merely ‘confidential’”.
[58]
Lastly, Merck Frosst did not meet its burden of providing
objective and specific evidence providing a basis on which to conclude that the
information still remaining on the pages in dispute constitutes trade secrets.
[59]
Absent explanations in support of the trial judge’s decision
stated at paragraph 105 of his reasons in appeal file A-492-06 and absent
adequate evidence, I find that the trial judge erred in law in exempting the 33
pages of records listed at that paragraph 105.
Paragraph
20(1)(b)
[60]
The Minister challenges the trial judge’s
conclusions at paragraph 106 of his reasons in A-492-06 and at paragraph 113 of
his reasons in A-496-06.
[61]
The paragraphs are the following:
In appeal A-492-06, paragraph 106 -
Disclosure
of pages 14 (the reference to the percentage), 33 to 34, 117, 147 (the last
three lines), and 207 should be refused under paragraph 20(1)(b) of the
Act since these page [sic] contain confidential information that was
treated in a confidential manner by the applicant and is not available in the
public domain.
[Emphasis
added.]
Appeal A-499-06,
paragraph 113 -
Disclosure
of pages 105 to 115, 119 to 121, 137 to 167, 212, 236, 242 and 244 should be
refused under paragraph 20(1)(b) of the Act because those pages
contain confidential information that was treated as such by the Applicant and
is not in the public domain.
[Emphasis
added.]
[62]
The burden of proof is on the party that is
objecting to the disclosure of records (Wyeth-Ayerst Canada Inc. v. Canada (Attorney
General), [2003] F.C.J. No. 916). That burden is heavy
(AstraZeneca Canada Inc. v. Canada (Health), [2005] F.C.J. No. 859,
paragraph 52, affirmed by [2006] F.C.J. No. 1076).
[63]
The exception provided at paragraph 20(1)(b)
contains three conditions, namely that the information be financial,
commercial, scientific or technical; that it be confidential; and that it be
consistently treated as confidential.
[64]
In the case at bar, the financial, commercial,
scientific or technical nature of the information in the records in dispute is
not being challenged.
[65]
In Canada (Information Commissioner) v. Canada (Canadian
Transportation Accident Investigation and Safety Board), [2006] F.C.J. No. 704, in which I wrote the reasons for
judgment, I summarized the state of the law regarding the particular
requirements for paragraph 20(1)(b):
71 The second requirement under the paragraph 20(1)(b)
disclosure exemption is that the information in question must be confidential.
72 The jurisprudence establishes that confidentiality
must be judged according to an objective standard: the information itself must
be “confidential by its intrinsic nature” (Société Gamma Inc. v. Department
of the Secretary of State of Canada (1994), 79 F.T.R. 42 at para. 8 [Société
Gamma]; Air Atonabee Ltd v. Canada (Minister of Transport) (1989),
27 F.T.R. 194 (T.D.) [Air Atonabee]; Cyanamid Canada Inc. v. Canada
(Minister of Health and Welfare) (1992), 52 F.T.R. 22, aff’d (1992), 148
N.R. 147 (F.C.A.); Merck Frosst Canada & Co. v. Canada (Minister of
Health), [2006] 1 F.C.R. 379 (F.C.A.)). In Air Atonabee, supra,
Mackay J. suggested the following approach to determine whether a particular
record contained “confidential information” (at page 210):
·
. . . whether information is confidential will
depend upon its content, its purpose and the circumstances in which it is
compiled and communicated, namely:
·
(a)
that the content of the record be such that the information it contains is
not available from sources otherwise accessible by the public or that could not
be obtained by observation or independent study by a member of the public
acting on his own;
·
(b)
that the information originate and be communicated in a reasonable
expectation of confidence that it will not be disclosed, and;
·
(c)
that the information be communicated, whether required by law or supplied
gratuitously, in a relationship between government and the party supplying it
that is either a fiduciary relationship or one that is not contrary to the
public interest, and which relationship will be fostered for public benefit by
confidential communication.
This Court recently endorsed this approach in Canada (Minister
of Public Works and Government Services v. Hi-Rise Group Inc. (2004), 318 N.R. 242 (F.C.A.) [Hi-Rise].
73 The burden of persuasion with respect to the
confidential nature of the information clearly rests upon the responding
parties (Canada (Information Commissioner) v. Atlantic Canada Opportunities Agency) (1999), 250 N.R. 314 at para. 3 (F.C.A.) [Atlantic
Canada]; Wyeth-Ayerst Canada Inc. v. Canada (Attorney General [sic] (2003), 241 F.T.R. 160, at para. 19). To satisfy
their burden in this regard, the responding parties must provide “actual direct
evidence” of the confidential nature of the information at issue (Atlantic
Canada, supra at para. 3), which must disclose “a reasonable
explanation for exempting each record” (Wyeth-Ayerst, supra at
para. 20); “evidence which is vague or speculative in nature cannot be
relied upon to justify an exemption under subsection 20(1)” (Wyeth-Ayerst,
supra at para. 20).
[66]
Yet, the test set out by the trial judge,
namely that the records “contain confidential information that was treated in a
confidential manner by the applicant and is not available in the public domain”
simply repeats paragraph 20(1)(b).
[67]
In both A-492-06 and A-499-06, Merck Frosst
failed to submit any direct and objective evidence regarding the information’s
confidentiality or its treatment as confidential.
[68]
With regard to appeal A-492-06, the Minister argued that
the filing of the affidavit of Margery Snider from Health Canada on September 26, 2001, was a pivotal step in the case.
Prior to September 2001, the reference exhibit was Appendix “J”.
[69]
However, in September 2001, after having carried
out more detailed research in the course of these proceedings, Heath Canada attached a new
version of the records with even more deletions than the first. This was
Appendix “Q” to Margery Snider’s affidavit dated September 26, 2001 (A.B.,
Vol. XXIII, page 6368).
[70]
In their respective affidavits dated December
7, 2001, both Annie Tougas and Robert Sarrazin, affiants for Merck, admit to
having reviewed the confidential affidavit of Margery Snider from Health Canada
dated September 26, 2001, containing both Appendix ”J” and
Appendix ”Q”.
[71]
In her December 7, 2001, affidavit (A.B., Vol.
XIII, page 3095), Annie Tougas states, under the heading “DECISION BY
HEALTH CANADA”:
86. Contrary to what is alleged at paragraph 90 of
Ms. Snider’s Affidavit (that the letter of January 2, 2001 “implied that
additional limited and specific representations might impact on Health Canada’s position”),
the said letter clearly states the following:
In the absence of detailed representations on your part,
identifying specific, limited details in the remaining information which may be
confidential, we were unable to reach the conclusion that any additional
information qualifies as confidential third party information under subsection
20(1).
Therefore, this will serve to advise you of our decision to disclose the
records as per the attached copy.
Should you still object, you have the right to request a review of this
decision before the Federal Court . . .
87. This corresponds with paragraphs 28(3) and (4)
of the ATI Act, to be the final decision by Health Canada “to
disclose the records as per the attached copy”, subject to this Court’s review.
This is how we, at Merck Frosst, understood the letter of January 2, 2001. This is why we filed our Notice of Application before
this Court.
[Emphasis
added.]
[72]
Although Merck Frosst had Appendix “Q”, a more
pared-down and contemporaneous version of the record than Appendix “J”, it
opted to continue to base its arguments on version “J” from January 2, 2001,
rather than the version appearing at Appendix “Q” of Margery Snider’s affidavit
from September 26, 2001.
[73]
This was an evolving process. In submitting the
record as set out at Appendix “Q”, the Minister fleshed out its position and
conceded some of Merck Frosst’s claims by paring the record down further. The
onus was on Merck Frosst to respond to this new version of the record, which
Appendix “Q” contained.
[74]
Merck Frosst must accept the consequences of
having chosen to remain silent, for all intents and purposes, with respect to
the version of the record contained in Appendix “Q”.
[75]
The affidavits submitted by Merck Frosst prior
to September 26, 2001, are of limited use since it is impossible to tell
whether a given argument still applies with respect to Appendix “Q”.
[76]
Furthermore, the affidavits submitted by Merck
Frosst after September 26, 2001, namely those of Annie Tougas and Robert
Sarrazin dated December 7, 2001, fail to provide the direct and objective
evidence required for an exception from disclosure to be granted under paragraph 20(1)(b).
[77]
Absent objective and direct evidence, the trial
judge erred at paragraph 106 of his reasons in refusing disclosure of the
information at pages 14 (the reference to the percentage), 33, 34, 117, 147
(the last three lines), and 207 of Appendix “Q” in appeal A-492-06 on the basis
of the confidentiality and the confidential treatment of that information.
[78]
As regards appeal A-499-06, the reference
exhibit is Appendix “U” to Margery Snider’s affidavit dated July 8, 2002.
(A.B., Vol. 10, page 3187).
[79]
Absent objective and direct evidence, the judge
also erred in refusing disclosure of the information at pages 105 to 115, 119
to 121, 137 to 167, 212, 236, 242 and 244 of Appendix ”U” in appeal file
A-499-06 on the basis of the information’s confidentiality and confidential
treatment.
[80]
Neither paragraph 106 of the trial judge’s
judgment relating to appeal A-492-06 nor paragraph 113 relating to appeal
A-499-06 can be allowed to stand.
Paragraph
20(1)(c)
Error
of fact and law
[81]
It has been consistently established in case
law that for paragraph 20(1)(c) to apply, the information for which an
exception to disclosure is claimed must not be in the public domain and that
there must be a “reasonable expectation of probable harm” (see AstraZeneca
Canada Inc. v. Canada (Health), [2005] F.C.J. No. 859, paragraph 109,
affirmed by our Court in [2006] F.C.J. No. 1076; see also Cyanamid
Canada Inc. v. Canada (Minister of Health and Welfare), [1992] F.C.J.
No. 144, paragraph 50, affirmed by our Court in [1992] F.C.J.
No. 950).
[82]
In AstraZeneca Canada Inc. v. Canada (Health), [2005]
F.C.J. No. 859, affirmed by this Court in [2006] F.C.J. No. 1076, Justice
Phelan stated the following regarding the evidentiary burden to be met under
paragraph 20(1)(c) of the Act:
109 Information which
is in the public domain (subject to limited circumstance where compelling
evidence establishes otherwise) cannot be said to be within section 20(1),
particularly paragraph (c). It is always incumbent on the person
resisting disclosure to establish harm, a more difficult task where the same
type of information is in the public domain including information available
from similar regulatory sources. See Canada Packers Inc. v. Canada (Minister of
Agriculture), 26 CPR(3d) 407 (FCA).
[83]
In
Canadian Imperial Bank of Commerce v. Canada (Canadian
Human Rights Commission), 2007 FCA 272, Justice Pelletier, writing for
the Court, emphasized the importance of checking whether the specific
information is in the public domain:
[61]
. . . Thus the test is not whether information of the same kind is available in
the public record but whether the specific information can be found there. . .
.
[84]
As well, the case law establishes that the onus is on the party
objecting to the disclosure to establish a probability of harm, and not a mere
possibility thereof. In SNC-Lavalin Inc. v. Canada (Minister of Public
Works), 79 F.T.R. 113, [1994] F.C.J. No. 1059, Justice MacKay of the
Federal Court held as follows:
43 Having
examined the Record and the Proposal, it is not self-evident to me from the
documents themselves that the applicant, whatever may be its concerns, has
demonstrated a basis for “a reasonable expectation of probable harm”. That
is the standard enunciated and applied by Mr. Justice MacGuigan in Canada
Packers10.
The applicant does not demonstrate probable harm as a reasonable expectation
from disclosure of the Record and the Proposal simply by affirming by affidavit
that disclosure “would undoubtedly result in material financial loss and
prejudice” to the applicant or would “undoubtedly interfere
with contractual and other negotiations of SNC-Lavalin in future business
dealings”. These affirmations are the very findings the Court must make if
paragraphs 20(1)(c) and (d) are to apply. Without further
explanation based on evidence that establishes those outcomes are reasonably
probable, the Court is left to speculate and has no basis to find the harm
necessary to support application of these provisions.
[Emphasis added.]
[85]
In
Viandes du Breton Inc. v. Canada (Department of
Agriculture and Agri-food), [2000] F.C.J. No. 2088, Justice Nadon (then of
the Federal Court) stated the following:
9 Further,
the plaintiff should not only state in an affidavit that disclosure of the
documents would probably cause it harm, it should also submit evidence of the
likelihood of such harm.
[86]
In
Wyeth-Ayerst Canada Inc. v. Canada (Attorney General), [2003]
F.C.J. No. 916, Chief Justice Richard, writing for the Court, confirmed and
reiterated this principle:
20 Affidavit
evidence which is vague or speculative in nature cannot be relied upon to
justify an exemption under subsection 20(1) of the Act.
[87]
In
appeal A-492-06, the trail judge addressed the exception under paragraph 20(1)(c)
of the Act at paragraphs 103, 104 and 107 of his decision. In appeal A-499-06,
the trial judge dealt with this exception at paragraphs 101, 111 and 112 of his
decision.
[88]
I
will first analyze appeal case A-492-06.
[89]
In
that case, the trial judge presented the results of his application of
paragraph 20(1)(c) as follows:
103 The pages concerning
which disclosure should be refused according to Mr. Sarrazin, the
applicant’s affiant, since they contain information that was not available “as
such” in the public domain are not excluded under paragraph 20(1)(c) of
the Act. According to the charts filed by the parties, these records consist of
pages 105 to 110, 135 to 142, 222 to 235, 342 to 355, 523, 530 to 531, and 537.
104 However, disclosure should be
refused under paragraph 20(1)(c) of the Act with regard to records
containing information that is more specific or more detailed than information
available in the public domain. According to the charts filed by the
parties, these records consist of pages 33 to 34, 117, 146 to 148, 170 to 173,
179 to 196, 204 to 208, 210, 212 to 213, 217 to 220, 236 to 327, and 399.
. . .
107 Disclosure of pages 33 to 34,
117, 146 to 148, 170 to 173, 179 to 196, 204 to 208, 210, 212 to 213, 217 to
220, 236 to 327, 399, and 527 should be refused under paragraph 20(1)(c)
of the Act since these pages contain information the disclosure of which could
reasonably be expected to result in material financial loss or gain to the
applicant or prejudice its competitive position.
[Emphasis
added.]
[90]
The
trial judge set out the two branches of the paragraph 20(1)(c) test. At
paragraph 104, he stated, “disclosure should be refused under paragraph 20(1)(c)
of the Act with regard to records containing information that is more specific
or more detailed than information available in the public domain”. At paragraph
107, he further stated, “Disclosure of [the] pages . . . should be refused . .
. since these pages contain information the disclosure of which could
reasonably be expected to result in material financial loss or gain to the
applicant or prejudice its competitive position”.
[91]
Did
the trial judge have the evidence to support a refusal of disclosure?
[92]
In
his affidavit dated June 1, 2001, (A.B., Vol. XXXII, page 8507) Robert Sarrazin,
affiant for Merck Frosst, stated the following:
[translation]
147. Pages 198 to 222
relate to the summary tables of clinical trials. These provide, on a
study-by-study basis, specific methodological details including the inclusion
and exclusion criteria used in clinical pharmacology trials, diagnostic
parameters and outcome measurements. This information represents the entirety
of the knowledge of Merck Frosst’s experts from the clinical pharmacology
assessment. . . .
148. This is scientific
or technical information (from Merck Frosst) that presents a likely
risk of significant commercial or financial repercussions. . . .
149. For an innovative
competitor, this is a comparison tool for preparing or improving the
developmental plan for a product in the same class. Drawing up a similar
plan from the available scientific documentation would require considerable
effort and a fair amount of time. This information is not usually exchanged
between competitors.
. . .
152. Pages 263 to 327
pertain to the discussion of the clinical trials. They contain a critical
analysis and an interpretation of the clinical outcomes conducted by expert
staff at Merck Frosst. . . . This “Discussion and Assessment of Clinical
Outcomes” is a veritable meta-analysis of clinical information having no
equivalent in the literature. . . .
153. This is scientific
or technical information (from Merck Frosst) that presents a likely risk of
significant commercial or financial repercussions. . . .
[Emphasis
added.]
[93]
These
statements, which encompass a large number of pages (up to 91 at a time),
remain vague, speculative and silent as to specifically how and why the
disclosure of the requested information would be likely to bring about the harm
alleged by Merck Frosst.
[94]
Regarding
appeal case A-499-06, the trial judge presented the results of his application
of paragraph 20(1)(c) as follows:
111 The pages in respect
of which the Applicant says that disclosure should be refused because they
contain information that is not “as such” in the public domain are not exempt
under subsection 20(1)(c). According to the tables submitted by the
parties, those pages are 7 to 16, 43 to 46, 48 to 54, 204 to 211, 213 to 225,
227 to 231, 233 to 235, 237, 239 to 241, 243, 245, 246 and 296.
112 However, disclosure
should be refused under paragraph 20(1)(c) in respect of documents containing
more specific or detailed information than the information in the public domain
the disclosure of which would likely cause the Applicant significant loss of
profit or undermine its competitiveness. According to the tables submitted
by the parties, those pages are pages 57, 187, 188, 200 and 202.
[Emphasis
added.]
[95]
In
this case, Merck Frosst’s evidence is similar to that for appeal A-492-06.
[96]
In
his affidavit dated May 2, 2002, (A.B. A-499-06, Vol. 6, page 1641),
Robert Sarrazin stated the following:
[translation]
99. To conclude, a SNDS, just like
a NDS, contains a great deal of scientific and technical information, even
commercial or financial considerations (including trade secrets), that is not
disclosed to third parties and, if it were to be disclosed, that disclosure
would be contrary to the confidentiality recognized and applied in the
industry. Such disclosure would also result in significant losses for the
company concerned and procure significant commercial advantages for a
competitor (including generic companies).
100. Considering the
sums involved, a single piece of information that may seem innocuous may
provide the key to a solution that had, until then, been fervently sought by a
competitor at great expense.
[97]
He
makes no mention of any of the pages listed at paragraph 112 in the trial
judge’s decision.
[98]
In
her affidavit dated May 2, 2002, (A.B., A-499-06, Vol. 6, page. 1853), Laura
King, affiant for Merck Frosst, stated for her part that:
34.
Consequently releasing this part of the SNDS will help a competitor to
understand Merck Frosst’s know-how and will assist a competitor in the
preparation of a NDS or SNDS. Knowledge of the contents of the submission would
facilitate a competitor in its drug development process and expedite their
product launch, resulting in material financial loss to Merck Frosst. This
includes another innovator company, working on a different chemical entity that
would be able to apply Merck Frosst’s strategy (know-how) (see pages
4,5,7, 18-20, 22-24, 34-104, 116, 122-129, 132, 179, 286-291 of the
Record). Consequently, according to my experience and expertise, this
information meets the requirements of paragraph 20(1)(c) of the ATI Act.
[Emphasis
added.]
[99]
Just
as in appeal A-492-06, these statements remain vague, speculative and silent as
to specifically how and why the disclosure of the requested information would
be likely to bring about the harm alleged by Merck Frosst.
[100] The trial
judge erred in fact and law at paragraphs 104 and 107 of his reasons in appeal
file A‑492‑06 and at paragraph 112 of his reasons in appeal file
A-499-06.
Issue (c) from the Minister’s appeal:
Did the trial judge err in fact and law in applying section 25 of the Act?
[101] At paragraph
108 of his reasons in appeal A-492-06, the trial judge wrote,
108 Except
where a specific passage from a page has been noted (see the examples at
paragraph 107 of these reasons), the page should be deleted in its entirety
under section 25 of the Act since, in this Court’s opinion, it would be very
difficult to separate information the disclosure of which should be refused.
[Emphasis
added.]
[102]
At
paragraph 114 of his reasons in A-499-06, he wrote,
114 At the
hearing, counsel for the Respondent conceded that some passages on pages 226,
232, 238 and 244 should be exempted under subsection 20(1) of the Act. The
Court’s view is that those pages should be suppressed in their entirety
under section 25 of the Act because I believe it would be extremely difficult
to isolate the information that should not be disclosed. The same is true
of the pages referred to in paragraphs 112 and 113.
[Emphasis
added.]
[103] In Rubin
v. Canada (Canada
Mortgage and Housing Corp.), [1989] 1 F.C. 265, our Court held the
following, as penned by Justice Heald:
13 I think it significant to observe that
section 25 is a paramount section since the words “Notwithstanding any other
provision of this Act” are employed. In my view, this means that once the head
of the government institution has determined, as in this case, that some of its
records are exempt, the institutional head, or his delegate, is required to
consider whether any part of the material requested can reasonably be severed.
Section 25 uses the mandatory “shall” with respect to disclosure of such
portion, thereby requiring the institutional head to enter into the severance
exercise therein prescribed. . . .
. . .
18 When sections 2 and 25 of the Act are read
in context, it is apparent that the respondent’s delegate erred in failing to
comply with the provisions of section 25. This failure to perform the severance
examination mandated by section 25 is, in my view, an error in law which is
fatal to the validity of the decision a quo. . . .
[104] The trial
judge had a duty to ensure compliance with section 25 of the Act, which, where
applicable, provides for severance, provided that such severance does not cause
serious problems. It was not open to him to order the removal of the
entire page without explaining the difficulties of the severance exercise,
which he did not do. The trial judge substituted his own discretion for that
exercised by the head of the government institution when there was no evidence
from Merck Frosst establishing that the first exercise by the head of the
government institution was incorrect. That is an error of law.
[105] Merck
Frosst argues (at paragraphs 128 to 142 of its memorandum) that it was up to
Health Canada to do a thorough study of the file and that Health Canada cannot
merely content itself with a cursory examination and then shift the burden to
Merck Frosst for Merck Frosst to do the work in its stead.
[106] That argument
disregards the case law on the subject, as shown in my reply to issue (b)
from the cross-appeal.
Issue (b) from the cross-appeal:
Did the trial judge err in ruling in favour of the validity of the government
institution’s procedure whereby the onus to establish that the Minister must
refuse the disclosure of a record is on the party objecting to disclosure?
[107] Merck Frosst
argues that the Minister could not place the onus on it to show why the
disclosure of the documents should be refused under subsection 20(1). Merck
Frosst asserted that the Minister had to perform a genuine and thorough
examination of the documentation before sending the notice pursuant to section
27 of the Act.
[108] Merck Frosst
submits that the trial judge’s finding that the onus of demonstrating the
application of subsection 20(1) of the Act is on interested third parties—in
this case, Merck Frosst—is erroneous. Merck Frost therefore submits that
the trial judge erred in validating the decision-making process that led to the
Minister’s decision dated January 2, 2001, in appeal A-492-06 and the one dated
December 19, 2001, in appeal A-499-06.
[109] In his
reasons for judgment in appeal file A-492-06, the trial judge concluded as
follows:
78 Despite the telling arguments put forward by the
applicant on this point, in this Court’s opinion the procedure of placing on
the applicant the onus of establishing that the respondent should refuse to
disclose the records under subsection 20(1) of the Act is not illegal.
79 Since
disclosure is the rule, and refusal to disclose is the exception, the
respondent was required only to identify the passages of records to which
subsection 20(1) of the Act was likely to apply, and then to ask the applicant
to make representations with regard to the applicability of subsection 20(1) to
all the records.
80 It is
clear that the applicant is in a better position and has greater expertise than
the respondent when it comes to identifying the passages of records that are
the subject of an access request and to which subsection 20(1) of the Act is
likely to apply, since most of the records emanate from the applicant.
81 This is
also one of the arguments put forward by the applicant in support of its
conclusions regarding the applicability of subsection 20(1) of the Act in
response to the following question, which deals with the validity of the respondent’s
conclusions regarding the applicability of subsection 20(1) to the records that
are the subject of the access request..
82 For a
third party, such as the applicant, this procedure unquestionably creates an
onus and a considerable amount of work when an access request is made and when
the time comes to reach a conclusion on the applicability of subsection 20(1)
of the Act. However, this burden is not out of proportion if we consider the
greater expertise of the third party and the importance that party is likely to
attach to the protection of information about itself.
83 In short, the
purpose of this procedure is to require the respondent to consult the applicant
after a fairly cursory examination of the records, to take the applicant’s
recommendations into account and, if it decides not to follow those
recommendations, to explain why. If the applicant is dissatisfied with the
respondent’s decision, it may apply to this Court under section 44 of the Act
for a review of the respondent’s decision.
[110] Identical
paragraphs, numbered 86 to 91 inclusively, are found in the trial judge’s
reasons for judgment related to appeal file A-499-06.
[111] Paragraphs
2(1) and 4(1) of the Act enshrine the right of Canadian citizens and permanent
residents to have access to records under the control of a government
institution except where limited and specific exceptions are made to this
right, while ensuring that decisions on the disclosure are reviewed
independently of government.
[112] The case law
of our Court consistently establishes that the burden is on the party objecting
to disclosure of the information (Wyeth Ayerst Canada Inc. v. Canada,
[2003] F.C.J. No. 916,
paragraph 19; Merck Frosst Canada v. Canada (Minister of
Health),
[2000] F.C.J. No. 1281,
paragraph 6).
[113] Under
section 27 of the Act, as it read at the time of the dispute, if the record
contains or the head of a government institution has reason to believe it might
contain the type of information that should be exempted pursuant to subsection
20(1) of the Act, the head of a government institution who intends to disclose
any record requested under this Act, or any part thereof, shall give the “third
party”, Merck Frosst in this case, written notice of the request received and
of the fact that the head of the institution intends to disclose the record or
part thereof.
[114] Contrary
to what was argued by Merck Frosst, Parliament imposes nothing more on the
government institution.
[115] The
only duty imposed on the head of the government institution under subsection
27(1) of the Act is that of stating, in the notice, the passages of the record
that are the subject of the access request and that contain or for which there
is reason to believe might contain
(a)
the
trade secrets of a third party,
(b)
information
described in paragraph 20(1)(b) that was supplied by a third party, or
(c)
information
the disclosure of which the head of the institution could reasonably foresee
might effect a result described in paragraph 20(1)(c) or (d) in
respect of a third party.
[116] Furthermore,
under subsection 27(3) of the Act, the notice shall include (a) a
statement that the head of the government institution giving the notice intends
to release a record or a part thereof that might contain material or
information described in subsection 27(1); (b) a description of the
contents of the record or part thereof that, as the case may be, belong to,
were supplied by or relate to the third party to whom the notice is given; and
(c) a statement that the third party may, within twenty days after the
notice is given, make representations to the head of the government institution
that has control of the record as to why the record or part thereof should not
be disclosed.
[117] The
words defining the duty incumbent on the head of the government institution did
not substantially change following the amendments made to section 27 of the Act
in 2007.
[118] The
trial judge’s finding in appeal cases A-492-06 and A-499-06 is consistent with
the Act.
CONCLUSION
[119]
In appeals A-492-06 and A-499-06, I would allow the appeals with
costs, set aside paragraphs 93 and 104 to 108 of the trial judge’s decision in
appeal A-492-06 and paragraphs 101 and 112 to 114 in the trial judge’s decision
in appeal A-499-06 and, rendering the judgments that he should have rendered, I
would dismiss the applications for judicial review.
[120] In
appeals A-492-06 and A-499-06, I would dismiss the cross-appeals with costs to
the Minister.
“Alice Desjardins”
“I agree.
Marc
Noël J.A.”
“I agree.
J.D.
Denis Pelletier J.A.”
Certified true
translation
Sarah Burns