Most Ontario court judicial reviews never reach the Court of Appeal. Judicial reviews of provincial and municipal administrative officials are normally heard in the Divisional Court—any further appeals require leave from the Court of Appeal. In West Whitby Landowners Group Inc. v. Elexicon Energy Inc.1, the Court of Appeal signaled its intention to hear more administrative law appeals.
What you need to know
- Leave to appeal is now subject to a simplified and more flexible test. The Court of Appeal jettisoned the traditionally strict test for leave (used since the 1972 Sault Dock decision) in favour of an "updated and more flexible approach".
- Leave will be granted in matters of importance or significance. Going forward, the ultimate question for the Court of Appeal is whether the issue on which leave is sought is of such importance or significance that it ought to be determined by the Court.
- The Court of Appeal seems poised to hear more administrative law matters. The Court recognized that administrative and public law matters "will often require the oversight of the Court of Appeal for Ontario".
Background on administrative law appeals
In Ontario, applications for judicial review of administrative decisions are generally heard by a panel of three judges in the Divisional Court (a branch of the Superior Court of Justice)2. Appeals from the Divisional Court are only available on questions that are not questions of fact alone, and only with leave from the Court of Appeal3.
For over 50 years, the Court of Appeal assessed motions for leave in accordance with a 1972 decision, Re Sault Dock Co. Ltd. and City of Sault Ste. Marie4. That decision provided a list of matters that would justify granting leave, which included: (1) the interpretation of a statute or regulation; (2) the interpretation, clarification or propounding of a general rule or principle of law; (3) the interpretation of a municipal bylaw on an issue of public importance; or (4) the interpretation of an agreement on an issue of public importance. The Court also left room for cases in which other "special circumstances" justified granting leave.
Over time, as the Court of Appeal recognized in West Whitby, Sault Dock came to be applied less like factors and more like a checklist, with some seeing it as establishing a strict test for leave from Divisional Court decisions.
The West Whitby litigation
The West Whitby Landowners Group Inc. is building a residential development in the Whitby area. To connect the development to the local electricity grid, West Whitby requires the distribution facilities of the local distributor, Elexicon Energy Inc. A substation is also needed to service the connection. As an electricity distributor, Elexicon is regulated by the Ontario Energy Board (OEB) and must comply with the OEB's Distribution System Code. Under the Code, if the substation is considered an "expansion" of the local system, West Whitby would bear the costs. If it is considered a system "enhancement", Elexicon would bear the costs. The parties disagreed on the proper characterization and, per the terms of their connection agreement, referred the matter to the OEB.
The OEB issued two letters concluding that the project was an "expansion" for which West Whitby would need to bear the costs. However, the OEB recognized that, since some of the project would not benefit residents of the development, it was not a "pure expansion", and there should be some cost reduction. West Whitby sought judicial review of the OEB's letters. The Divisional Court dismissed the application, concluding that it had no jurisdiction to consider it. West Whitby sought leave to appeal.
Ontario Court of Appeal reformulates test for leave and invites more administrative law appeals
The Court of Appeal observed that rigid adherence to Sault Dock had given rise to "two unhealthy features" in the Court's leave assessments. First, it ignored the flexibility intended by the panel deciding Sault Dock, which gave examples of cases where leave might be granted but did not intend those examples to be an exhaustive list. Second, it ignored that a lot had changed since Sault Dock was decided, including the enactment of the Charter, which plays an important role in judicial reviews brought before the Divisional Court.
Rejecting the "checklist" in favour of an "updated and more flexible approach", the Court of Appeal set out a new threshold for leave applications going forward: "Is the question on which leave is sought one that, by reason of its public importance, the importance of any issue of law or mixed law and fact involved, or for any other reason is of such a nature or significance that it ought to be decided by the Court of Appeal for Ontario?"
Under this new framework, the Court of Appeal also signaled its intention to hear more administrative law appeals. The Court recognized its important role in clarifying and developing Ontario's jurisprudence as the province's court of last resort. In this context, it explained that the "development of administrative law, and public law more generally, will often require the oversight of the Court of Appeal for Ontario".
The Court concluded by granting West Whitby's leave application. It explained that the Divisional Court appeared to insulate certain decisions of the OEB from judicial review, which would have broader implications for all Ontarians.
What's next?
The Court of Appeal's decision simplifies the test for obtaining leave to appeal from the Divisional Court. However, whether this makes leave easier to obtain, and in what cases, remains to be seen. What appears clear is the Court's intention to grant leave in more administrative and public law cases. If this invitation is followed by other panels, the next few years could see the Court of Appeal becoming a more influential source of law in this area.
Footnotes
1 West Whitby Landowners Group Inc. v. Elexicon Energy Inc., 2024 ONCA 910.
2 Judicial Review Procedure Act, R.S.O. 1990, c. J.1, s. 6(1). In matters of urgency, a person can apply for leave to have the judicial review heard by a single judge of the Superior Court of Justice: see s. 6(2).
3 Courts of Justice Act, R.S.O. 1990, c. C.43, s. 6(1)(a).
4 Re Sault Dock Co. Ltd. and City of Sault Ste. Marie
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