On December 19, 2019, the Supreme Court of Canada released its long-awaited trilogy of decisions that will significantly shift administrative law.

Administrative law encompasses legal challenges to regulatory or government action, ranging from cabinet approval of pipelines to the denial of refugee status, from professional regulatory decisions to First Nations band council decisions.  Recognizing the scope of the subject matter, the Supreme Court took on the herculean task of simplifying the law and specifically the standard of review against which government action will be assessed in the Courts (at para 11). The lead decision, Canada (Minister of Citizenship and Immigration) v Vavilvov, 2019 SCC 65 [Vavilov], sets out a revised framework for judicial review of administrative decisions that explicitly replaces the contextual framework set out in Dunsmuir v New Brunswick, 2008 SCC 9 (at para 17).

Vavilov reviewed the revocation of citizenship from the Canadian born child of Russian spies. Mr. Vavilov was born in and spent his early childhood in Canada.  Unbeknownst to him, his parents were working under "deep cover" in Canada and subsequently the United States to gather information for Russia's foreign intelligence service. After his parents were arrested and their positions were exposed, Mr. Vavilov attempted to renew his Canadian passport. The Registrar of Citizenship instead revoked his citizenship. The legal basis for this decision was that section 3(2)(a) of the Citizenship Act provides an exception to the automatic grant of citizenship to some people born in Canada. Section 3(2)(a) denies citizenship to a child of a "diplomatic or consular officer or other representative or employee in Canada of a foreign government" in Canada. This is because such officials and their children enjoy immunities and privileges distinct from other Canadian residents and citizens (at para 172).

In the course of considering this decision, the Supreme Court outlined a new, simplified framework for judicial review of administrative action.

New Foundation for Judicial Review

Prior to Vavilov, a key justification for deferring to administrative decision makers was that they were more familiar with, and had specialized expertise in, the administrative schemes they worked within every day. This is no longer a foundational principle of the law of judicial review. Rather, the focus now is on legislative intent and institutional design by the legislature. Judicial review must proceed in a way that respects the legislative choice to delegate decision-making authority, and ensure that authority is exercised in a manner that is consistent with the rule of law (at paras 23-24, 30). Although a decision-maker's expertise is no longer relevant to determining the standard of review, it remains "a relevant consideration in conducting reasonableness review" (at paras 31, 93, 119).

Streamlined Standard of Review through the Presumption of Reasonableness

Because the focus of judicial review is no longer on factors like relative expertise, the Court has abolished the "contextual analysis" used in Dunsmuir to determine which standard of review for an administrative decision, namely reasonableness or correctness, is applied in judicial review. Now there is a presumption that the standard of review of reasonableness applies to all aspects of a decision unless it is rebutted by a clear legislative intent that a different standard applies or it is necessary for the rule of law to ensure that the decision is correct (at para 25).

Correctness – Statutory Appeals

Legislative intent to apply a standard of review other than reasonableness can be shown in two ways. First, the legislature can legislate a standard of review (at paras 34-35). Second, the legislature can create a statutory appeal to a court (at paras 36-52)

Under pre-Vavilov law, particularly Edmonton (City) v Edmonton East (Capilano) Shopping Centres Ltd, 2016 SCC 47, statutory appeals and judicial reviews were treated the same  as far as the standard of review is concerned. This is no longer the case. Statutory appeals are now true appeals, unless the legislature specifies otherwise. Decisions that are subject to a statutory appeal are not reviewed on the standard of reasonableness. Rather, appellate standards of review, as used by courts of appeal, will apply. This means that, where a statutory appeal exists, issues of law will be reviewed on the correctness standard and issues of fact or mixed fact and law will be reviewed for "palpable and overriding error" (at para 37). Whether the legislation requires leave to appeal is irrelevant (at para 50).

The effect of this new analysis is to impose a more onerous review to some independent public bodies, like the CRTC in Vavilov's companion case Bell Canada v. Canada (Attorney General), 2019 SCC 66, and a relatively lesser standard ("robust" reasonableness) to lower level administrative decision-makers, such as visa officers.

Correctness – Rule of Law

The other route that can lead to the standard of review of correctness applying is that it is necessary for the rule of law. There are three categories of legal questions that justify correctness review under this principle: constitutional questions, general questions of law of central importance to the legal system as a whole, and questions about the jurisdictional boundaries between two administrative bodies (at para 53). Courts, in their roles as overseers of the legal system, are entitled to substitute their own views for those of administrative decision-makers where these questions arise. While it is possible that additional categories of questions could be added to this list, it can only be expanded where "failure to apply correctness review would undermine the rule of law and jeopardize the proper functioning of the justice system in a manner analogous" to the existing categories (at para 70).

After years of commentary about whether true questions of jurisdiction actually exist, the category was finally eliminated in Vavilov.  This a welcome rejection of Dunsmuir 's fourth category of legal question was identified as giving rise to correctness review (true questions of jurisdiction).  Questions about jurisdiction, which are questions about whether an administrative decision-maker can do what it did, are really about statutory interpretation, which are reviewed for reasonableness (at para 68).

Reasonableness – Inconsistent legal interpretations

The Supreme Court also expressly rejected the submissions that correctness should apply where there is "persistent discord" between decision-makers about a legal issue (at paras 71-72). This means that one decision-maker may say yes and another may say no in similar circumstances, leading to inconsistent and possibly unfair outcomes for those affected. The Supreme Court was satisfied that such disagreement could and should be dealt with in applying the reasonableness standard. Their proposal is that courts may give guidance to administrative bodies to develop policies—without fettering discretion—to guide decision-makers towards coherence. In other words, unless one interpretation is unreasonable, the Courts will have a hands-off approach (at paras 131-132).

Notably, Courts have recently found such internal attempts to avoid discord to be unlawful, including peer review of decisions (Shuttleworth v. Ontario (Safety, Licensing Appeals and Standards Tribunals), 2019 ONCA 518) or a Chairperson's development of a jurisprudential guide, as provided for in the statute, to members of the Immigration Refugee Board (Canadian Association of Refugee Lawyers v. Canada (Citizenship and Immigration), 2019 FC 1126).

Reasonableness Review

While the first half of the majority's reasons in Vavilov set out the new standard of review framework, the second half addresses how courts should perform reasonableness review. The Supreme Court, in this portion, sets out to encourage a "culture of justification" among administrative-decision makers (at para 2). The Supreme Court states that an unreasonable decision is one with a "fundamental flaw" (at para 101).

In doing so, the Supreme Court emphasizes the importance of reasons. While an administrative tribunal's reasons are often an important part of judicial review, the focus of reasonableness review is more fundamentally on the decision-making process and its outcome in its institutional and policy context. Administrative decisions must be considered as a whole, and will be reasonable if they are "based on an internally coherent and rational chain of analysis and [are] justified in relation to the facts and law that constrain the decision maker" (at para 85).

As the focus of reasonableness review is both on the process leading to a decision and the decision itself, it is not enough that an outcome may be justifiable for it to be reasonable. It must be justified by a transparent and intelligible chain of reasoning as well.

Where reasons for a decision exist, they are the starting point for analysis. Reasoning in administrative decisions does not have to be perfect, or even comparable to judicial reasoning, and must be considered in the context of the proceedings and any institutional expertise that the decision-maker has. If there are gaps in an administrative decision-maker's reasons, the Court cannot substitute its own reasons for the outcome in the course of judicial review. The Supreme Court therefore inches away from its previous analysis in Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62,  that a Court may look to the record to shed light on  the decision where there is a gap in the reasons.

To determine whether an administrative decision is reasonable, in light of the context in which it was made and the facts and law at hand, the Supreme Court provides guidance as follows:

  • The reasoning must be rational and logical, and provide a chain of analysis that a reviewing court can follow to see how the decision was reached;
  • The reasoning must be justified in light of the law and facts that are relevant to the decision, including the language and scope of the governing statute, other statutes or the common law (including consideration of any binding precedential decisions), the principles of statutory interpretation and their application by the decision-maker to the statutory scheme, the evidence before the decision-maker, the submissions of the parties, past practices of the tribunal, and the impact that the decision has on the parties; and
  • Where there are no formal reasons for a decision, such as the passing of a municipal by-law, the outcome must be intelligible in light of the context of the decision (i.e. the deliberations that led to its enactment) and the institutional constraints that apply to it.

Remedies for Unreasonableness

Where an administrative decision is unreasonable, either because the outcome is unjustified or the process is flawed, the court should generally remit the decision back to the decision-maker to carry the process out properly. However, the Court reserves the discretion to implement alternative remedies on judicial review where, for instance, there appears to be "an endless merry-go-round" of reconsiderations and reviews (para 143). Therefore, where it would serve no purpose to remit the decision because the outcome is inevitable, or it would otherwise be inappropriate to do so for reasons of delay, fairness, or the use of resources, the reviewing court may decide a matter in place of the original decision-maker.

So What Happened to Mr. Vavilov?

Applying the new framework, the Supreme Court held that the Registrar's decision was unreasonable. Section 3(2)(a) of the Citizenship Act, when considered in its full context, was not intended to exclude children of foreign government representatives who did not have diplomatic privileges and immunities from obtaining citizenship. Based on the Supreme Court's statutory interpretation, an essential factor for section 3(2) to exclude citizenship is the diplomatic status of the child's parents.

Interestingly, a factor in this analysis was the consistency of decision-making and the impact the Registrar's broad interpretation of section 3(2) would have on the children of any individual employed by a foreign government in Canada ("it perhaps goes without saying that rules concerning citizenship require a high degree of interpretive consistency in order to shield against a perception of arbitrariness and to ensure conformity with Canada's international obligations" at para 192). The Registrar's decision would have put others born in Canada to parents who work for a foreign government in peril, as it could effectively render them stateless; this could not have been Parliament's intent.

As the decision was unreasonable, and on the facts only one outcome was possible, the Supreme Court decided that Mr. Vavilov was a Canadian citizen.

What Comes Next?

The Supreme Court's decision in Vavilov provides a welcome corrective to the structure of administrative law, and we are hopeful that it will streamline judicial reviews going forward. However, a number of issues will have to be worked out in light of the new framework, including:

  • The role that statutory appeals to administrative bodies (such as appeal committees formed by professional regulators) play in it, and whether the administrative standard of review scheme or the appellate standards of review applies to them (both when they decide an appeal and when a court reviews their decision);
  • Whether the decision (not intervening in the absence of fundamental flaws or even persistent legal discord) suggests that courts will show a higher degree of deference to the vast majority of decision-makers not subject to statutory appeal mechanism;
  • Whether this decision will open up the possibility that some procedural fairness questions, especially where related to the institutional design, will be reviewable on the reasonableness standard. For now, the Supreme Court has carved out these questions as still being subject to correctness (para 23);
  • The role that reasons will play in judicial review and the impact this will have on administrative decision-makers and regulators in providing the same;
  • How regulatory bodies and tribunals can develop lawful internal policies to move towards coherence in decision-making, without fettering the discretion of its decision-makers;
  • Whether courts will be more willing to provide remedies other than a "re-do" by the administrative decision-maker and the impact this may have on the decision-making process.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.