Breakfast With Appeal is Torys' quarterly series showcasing the appellate law that's shaping Canadian conversations. Visit our main Breakfast With Appeal page for more content and upcoming webinars.
The BWA panel continues their discussion on interjurisdictional immunity as it relates to two recent Supreme Court cases—and offer their views on why the saga of IJI, as it relates to projects of national importance, will require several sequels and spin-offs.
Transcript
Yael Bienenstock (00:08): Welcome to Breakfast With Appeal, Torys' quarterly series on the cases you want to know about. We offer our thoughts on the appellate law that's shaping Canadian conversations. Let's dive in.
Andrew Bernstein (00:23): So, David, first of all, Happy David Outerbridge Appreciation Day. We appreciate you.
David Outerbridge (00:30): Well, after seven years of BWA, it's nice to know that. [Laughter]
Andrew Bernstein (00:33): Okay, well, I know you weren't sure. So, there you go.
Jeremy Opolsky (00:36): We will bring a cake next time. It will be shaped like a mug. [Laughter]
Andrew Bernstein (00:39): Oh, speaking of which, yes, please, do ask questions. We will—if your question makes it on the air, we will send you a mug. But, but right now, I'm gonna ask a question of David, which is, knowing that you're appreciated, we have this doctrine, interjurisdictional immunity, whose status is a little uncertain. Two cases wind their way up to the Supreme Court. Tell us a little bit about them.
David Outerbridge (01:04): Alright, so there's one case that involves the exclusive federal power over aeronautics, and another one that involves the exclusive federal power over navigation and shipping. And they're both coming out of the Québec courts. So, in the first case, the Opsis case, there was a—Opsis was a company that provided airport security at the Trudeau International Airport.
In the second case, the Québec Maritime Shipping case, QMS, Québec Maritime Shipping, provided, among other things, security service for a dock where transatlantic shipping departed from. The common factor in the two cases is they both involve private security services, and in Québec, there's a statute called the Private Security Act that says if you want to provide private security services, you have to be licensed and comply with the regulatory regime administered by the provincial regulator.
And so, the question in the two cases was whether this Québec statute applied to these two areas of federal power, the aeronautics area and the shipping area—or as Yael was explaining, whether the application of the security service statute to these two areas of federal law would impair the core of those federal powers.
And so, both Opsis and QMS were charged with a provincial offense under this statute for operating without a license. There was no dispute that they didn't have a license, they didn't challenge that, but what they did challenge was the application of this statute to them because they were involved in a federal, an area of exclusive federal jurisdiction, and they relied upon the IJI doctrine. And both matters went to four levels of court.
So, Québec provincial court, Québec Superior Court, Québec Court of Appeal, ultimately, the Supreme Court, and the decisions are all over the place. You know, the, they—there's reversals and reversals and different courts coming to different decisions for different reasons, based on different interpretations of what the core of the federal power is and whether there's genuinely an impairment, etc.
By the time the two matters got to the Québec Court of Appeal, the Court of Appeal concluded that the IJI doctrine did not apply to prevent these charges from being valid. In other words, the Court concluded that the Québec statute did apply, it didn't impair the core of a federal jurisdiction, and that the IJI doctrine was of no help. So then, it went to the SCC, and what happens there, only Jeremy knows. [Laughter]
Andrew Bernstein (03:21): Okay. Thanks, Dave. And, Jeremy, it's your turn now.
Yael Bienenstock (03:26): The rest of us didn't read the case.
David Outerbridge (03:27): That's right, that's right. [Laughter]
Yael Bienenstock (03:29): Just joking [Laughter].
Andrew Bernstein (03:31): Okay, so we have this doctrine whose status was "it's complicated". And these interesting fact scenarios about security services and airlines and shipping... So, give us the—I'm going to ask you to tell us what the Supreme Court did. I'm going to ask you to give us the high notes, but I'm going to remind you that we still, you're still not the musical guest. So, when I say high notes, I mean figuratively.
Jeremy Opolsky (03:55): [Laughter] I mean, let's be honest here. I mean, you play the guitar, Yael sings pretty well, I assume David is good at everything he touches. I absolutely have no musical talent, and I will not...
Andrew Bernstein (04:05): You're the critic. You're the critic in the—
Jeremy Opolsky (04:05): Sure, sure. [Laughter]
Yael Bienenstock (04:07): You got to more musicals than anyone else. [Laughter]
Jeremy Opolsky (04:08): That's true, that's true. As long as my instrument is a laptop [laughter] and not anything else, I'm good.
Andrew Bernstein (04:13): I believe in modern music. A laptop is quite a powerful instrument. But anyway.
Jeremy Opolsky (04:19): So, what happened here? In short, you know, the, the title of this musical, which would be a terrible title [laughter], is that IJI applies: these laws, the correct laws, are inapplicable to the functions of maritime and airport security. And the—before we talk about why, let's talk about what this case does in a continuation to Yael's bubble story. I'm not sure we're back where we were, sort of the 19th century, but we're a whole lot closer, to where we were. Back to sort of the more, popping, or pricking, end of the, the, the spectrum rather than sort of whole scale popping the bubble.
So firstly, the first big contribution of this case is that on the intrusion of the core power, the Court has retreated significantly, I think, from Canadian Western Bank. They didn't say that. They say that everything they're doing is completely consistent with Canadian Western Bank, but they are awfully selective in the cherry-picked quotes they use from their previous precedents.
Yael Bienenstock (05:22): Yes. [Laughter]
Jeremy Opolsky (05:23): They emphasize that—in Canadian Western Bank, as Yael said, the Court said that IJI should be used with great restraint. And in general, it should be reserved for situations already covered, covered by precedent. And the vibe was not, "it's complicated". It was "we're stuck with this relationship, but we want to move forward with the rest of our lives and never look at it ever again".
Here in Opsis, the Court really emphasizes the general part of the quote, and ignoring this idea that the, that this should be paralyzed in the past, they find that precedent, well, was a useful guide—which seems obvious to me because that's our whole system of common law precedent, it is always a useful guide. But they said it did not prevent the expansion of IJI in other situations, and it adopted a very friendly IJI decision of the Québec Court of Appeal in Attorney General and IMTT, a case about environmental protections and a port operator, and the idea that IJI needs to continue to expand and grow.
On impairment, that second part of the test Yael talked about, the Court liberalized the test, making easier to show impairment. While a court must take into account the effects of the application of the impugned statute, whether they have materialized or not. That last part is very important. In other words, there's no need to wait and see if effects will happen.
If the impugned law causes or has the potential to cause an adverse effect on the court of the power, it constitutes an impairment. So why do you care? Why do we care? It's because this is key in statutes where there is a broad discretion on behalf of the provincial government to grant, withhold or revoke a license, which basically is found to give the province control over whether someone can operate an undertaking or not, whether someone can move forward with a project or not.
And it deprives the feds of that ability to permit or prove something and gives it to the province. And the court adopted the Ontario Court of Appeal's decision in Andrew and Yael's case, Halton and CN, where a broad licensing regime was found to impair the core of a power in relation to a multimodal transit hub. Did I say "multimodal" right?
Andrew Bernstein (07:41): We often say "intermodal".
Jeremy Opolsky (07:42): Okay, so—
Andrew Bernstein (07:44): But yes, that's fair.
Yael Bienenstock (07:45): Same thing.
Jeremy Opolsky (07:46): So, what did the Court do here, very quickly? Because I know you're all worried about your security at airports and particularly when you go for maritime shipping, the legislation was found to be inapplicable here. Parliament has an exclusive power both over navigating and ship— navigation and shipping under 92(10). And over aeronautics, I love that term, under the Peace Order and Good Government clauses. And security was found to be at the core of these powers.
The Court says you can't have either aeronautics or maritime shipping without robust safety and security measures, which does seem to me to be a bit of common sense. To hear the broad powers of the Québec agency, the Bureau, to suspend, cancel or refuse or—sorry, or refuse to renew the license of a holder who violates the standards of conduct or refuses to follow their directives, gives the province such a broad discretion to control who provides security, that it was found to impair that core. And the Court, the Supreme Court of Canada likens it to a sword of Damocles that hangs over the security providers, where the provincial government can say when that sword falls. So, in short, these laws don't apply.
Andrew Bernstein (09:02): Okay. Thanks, Jeremy. Yael, I'm going to ask you to kind of sum up a little bit, but also perhaps while you're doing that, you could just answer a question that we have from one of our viewers, Ethan: how does IJI mesh with the usual constitutional analysis of validity and paramountcy? It seems like two different ways to approach constitutionality.
Yael Bienenstock (09:28): [Laughter] That's... You want me to do this all quickly? Okay.
Jeremy Opolsky (09:31): Did you plant that question, Andrew?
Yael Bienenstock (09:33): So, so the validity question always comes first. So, before you engage in any of these questions of how, how do we deal with laws from one level of government, you know, kind of, going into the other level of government's territory, the first question is always let's, let's just stick to the federal-provincial paradigm because it's much easier.
So, if we're asking the question, you know, how does a provincial law effect federal power or federal laws, we always have to first ask the question: is the provincial law actually valid? And that's the pith and substance analysis, and I won't go into how we do it. But you ask the question, "is it valid under the provincial jurisdiction?"
If it is valid, then we ask the question, okay, what happens to this issue that we're talking about, which is a federal issue. So, if we're talking about—and you can do both an IJI and paramountcy analysis, they're not mutually exclusive. Paramountcy deals with when there is, let's say, a federal law. And if you have a federal law that conflicts with the provincial law or if the provincial law frustrates the purpose of the federal law, then the federal law is going to take precedence.
IJI deals with this issue when there may not actually be a federal law. It's just the question of: does the provincial law apply to this matter that we're talking about? And if the matter falls within the core of the power, and if the provincial law impairs the court, then it doesn't apply. So, the law still exists, it's not off the books, it's just read down to not apply to this particular situation that we're talking about.
So, I hope that answers the question. In terms of a summary, you know, I guess the "where are we now?" question, I'll just mention a couple of things. I mean, the test from Canadian Western Bank didn't actually technically change. It's more the approach to the test. So Canadian Western Bank did say, generally it should be applied for precedent.
But the thing that really changed is kind of the language and the approach. So Canadian Western Bank used words in discussing IJI like "limited", "restraint", it said it was "superfluous". And we get to Opsis and the Court is using language like "useful", "essential", and giving [laughter], and giving courts tools to really make the doctrine pretty robust.
I found the precedent part particularly interesting because in the IAA reference Justices Karakatsanis and Jamal wrote a dissent. And one of the things they said in that dissent is Alberta had been arguing for provincial IJI, and they said, "no, no, no, you can't have provincial IJI because there's no precedent". And here they're saying, "hmm, you don't really need a precedent". So, I found that to be something interesting and sort of speaks to how the world is evolving on these points.
Did you ask me the status question?
Andrew Bernstein (12:19): Yes.
Yael Bienenstock (12:20): Okay. Fine. [Laughter] I, I couldn't remember what the questions were. Okay—
Andrew Bernstein (12:22): Becoming a problem here today.
Yael Bienenstock (12:23): [Laughter] I know. There's too many questions at once. We need to do one at a time.
Jeremy Opolsky (12:27): Status update is: confused.
Yael Bienenstock (12:29): No, no, I have a better one. I'm going to stick with the movie theme, and I have to say, this whole thing is giving me Star Wars vibes, so I don't know what, I don't know what era we're in, but we've gone back to the 1980s and I think Episode One is Jurisdiction Wars: The Birth of IJI.
Episode Two is The Provinces Strikes Back or Paramountcy Strikes Back. I was trying to decide between the two. The latest sequel in the trilogy is The Return of IJI, and stay tuned for the next episode: Cooperative Federalism Awakens. [Laughter]
Andrew Bernstein (13:01): Nice, nice. [Laughter] Okay, well, well done. Well done. Good. It's not every Breakfast With Appeal that Yael has the best shtick.
Yael Bienenstock (13:11): I never have the jokes. [Laughter].
Andrew Bernstein (13:12): But, you know, today you're hitting it out of the park.
Yael Bienenstock (13:15): Return of the Jedi. Return of IJI.
Jeremy Opolsky (13:17): Yeah, we got it, we got it. [Laughter]
Yael Bienenstock (13:19): That's the one that got it started. [Laughter]
Andrew Bernstein (13:20): You don't have to, you know, overexplain. David, back to you. So, some of the time you're a projects lawyer. Do you think that this decision will make building national projects easier or harder?
David Outerbridge (13:36): Well, there's the theoretical answer, and then there's the actual practical answer. So, in principle, if a national project falls, as it would, under an exclusive federal power. So, if we're talking about a port or an airport or a railway or an interprovincial pipeline or a military facility, in principle, based on this case, the courts should feel very comfortable concluding that if something interferes with the core of a federal power, whether it's precedent-based or not, that it, that the provincial law doesn't apply. Conceptually, that seems fairly straightforward.
The practical answer is that these fights are going to continue to be fought, because what actually happens in practice is, provinces enact statutes of general applications—so the Private Security Act was a statute of general application—and the question is not: did the province target the federal undertaking? The question is: which of all of the hundreds of statutes of provincial of general application apply to a federal project?
And so, when you're working on a project in a province, you have to figure that out. And it's not like you have a bunch of constitutional lawyers standing around your construction site figuring out whether a particular statute from the province applies there. You know, even the constitutional law experts in the courts of Québec and the Supreme Court were all over the place on what the right answer was to this IJI question.
And the Supreme Court, when they got to it, was all over the place compared to where they had been before. So, no one really knows what the answer is, because the Supreme Court could change again. And it's complicated, as Yael said. So, you know, the, the, the person who's making the decision about whether to apply a statute on the ground is the charging officer or the regulator, who is not going to understand necessarily that there is an IJI doctrine, or if they do, they're, you know, they have their own view on what the core of a federal power is and whether the statute should apply, etc.
So, if you're working on a national project, chances are you're still going to be fighting these fights, just as Yael and Andrew did in the CN case that was mentioned that, you know, parties who want to take a run at a project are going to take a run at a project, and they're going to have fights about it. So, I don't think this enhances the certainty. It just creates a whole bunch of new types of uncertainty.
Andrew Bernstein (15:47): Okay. Was hoping for better news [laughter], but I will say our colleague, our alum, Vitali Berditchevski, wrote in and said that IJI is very important in the telecom context because sometimes municipalities set difficult conditions of access to public property so that—yeah, I mean, it's telecom, it's rail, it's aeronautics, it's shipping, those are—
Jeremy Opolsky (16:12): It's nuclear.
Andrew Bernstein (16:14): Nuclear. Yeah, potentially. Those are the places that we would see IJI showing up that are the most important. David—Sorry, Jeremy, last word to you on this. [Laughter].
It is David Outerbridge Appreciation Day, Jeremy. But, so while you're showing your appreciation for David, I just wanted to get you to comment on provincial IJI. It's come up a couple of times, we know the Québec Court of Appeal talked about it in the impact assessment—
Yael Bienenstock (16:43): Alberta.
Andrew Bernstein (16:44): I'm sorry, the Alberta Court of Appeal and the impact assessment reference. Does, would you—it's never really been a thing before. Would you say this case makes it officially a thing? But more importantly, where do you see it potentially applying?
Jeremy Opolsky (16:57): That's a great question. It gave me a chance to revisit the Alberta Court of Appeal's decision, the IAAA decision. And then when I saw it was 400 pages long, I realized why I tried to avoid it. [Laughter] What the Court of Appeal says in that decision is that, rightly, that interjurisdictional immunity has only been used to protect federal powers in the past.
But they say it would be unfair if only the feds were protected. And they say the provincial powers are no less exclusive than federal powers. And it should be, it should protect the provincial powers under section 92, as well. And here in Opsis, the Supreme Court of Canada says what it's said since Insite, which is on a principal basis there's no reason to believe that shouldn't be true. IJI can apply to provinces. But the question is when and will it? And it certainly hasn't to date.
I don't think it's as clear-cut as the Court of Appeal makes it out to be. Provincial powers are a little different than federal powers. They're written different. In many ways they're more robust. Matters of a local or private nature and property and civil rights in a province are so broad that it's hard to define their core.
And if you did use an IJI perspective, you could overwhelm all federal jurisdiction, entirely. But where we might see it apply more robustly is section 92A(1), which is—or section 92A to say—which is exploration, development, management of non-renewable resources, forestry, generation of electrical energy, etc. I think this will be the next big frontier in IJI for the next decade, where federal environmental, waterway or other regulations apply to oil and gas or hydro, or other forms of non-renewable resources will be challenged. And we will see if the Supreme Court is true to its principle of saying the same rules apply to the provinces in creating metes and bounds around those areas forced to assume provincial jurisdiction.
That seems like a bummer place to end this case. [Laughter]. But I guess the question is like, we'll see in episode nine of the IJI —
Yael Bienenstock (19:10): Not trilogy.
Jeremy Opolsky (19:10): Non-ilogy, or whatever.
Andrew Bernstein (19:11): Yeah, exactly. Well, I, I'm going to go out there with a prediction. It's being recorded for posterity. I do not think we'll ever see a case in which the federal law is deemed to be inapplicable to a provincial undertaking due to IJI. I think that the possibility will always remain open, will never be closed out, but the courts will always say, "no, that's not this kind of case". So, that's my prediction. We'll see how it goes.
Yael Bienenstock (19:37): And if it does apply paramountcy would kick in, right?
Andrew Bernstein (19:40): Well, that, that, that's the problem, right? [Laughter]. There's this weird relationship here. So, I mean, I think it's really, it's, it's, it's problematic in a way that the Court hasn't really worked out.
That about wraps up our conversation. Before we go, I want to remind our listeners that they can find the webinar version of this edition of Breakfast With Appeal, along with previous episodes on torys.com, and that our BWA program is eligible for one substantive hour of continuing professional development. Thanks again for joining us and take care.
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