Over the last 10 years, asking the courts to judicially review the legality of administrative decision-making in Canada has become an expensive gamble, with low odds.
It is a gamble because it can be extremely difficult to know in advance how much deference the court will give to administrative decision-makers (the so-called “standard of review”). It is low odds because ever since the Supreme Court’s decision in Dunsmuir, the default rule is that administrative decisions are reviewed for “reasonableness,” where the court only looks to see whether the decision falls within a range of plausible alternatives, and the range can be very broad.
Reconsidering the “Standard of Review Analysis”
About eight months ago, the Supreme Court of Canada declared it would use three upcoming appeals as an opportunity to (once again) reconsider what has become known as the “standard of review analysis.” Since then, the administrative law world has been abuzz with surmising, theorizing and hypothesizing about what the Supreme Court will do. While it may be tempting to dismiss this as the melodrama of public law junkies who will find any excuse to discuss their favourite topic, how and when the court reviews administrative decision-making essentially sets the terms by which Canadians and Canadian businesses are regulated. Too much deference allows administrative actors nearly unlimited discretion to regulate without regard for the underlying legislation, while too much interference by the courts replaces legislated delegation with regulation by the judiciary. While neither of these extremes is desirable, the Supreme Court has had difficulty striking an adequate balance.
Since the 1970s, the result has been a pattern we have dubbed “Dicey’s Comet” because it seems to show up in the sky at regular, predictable intervals of about 10 years.1 First, the Supreme Court issues a fix intended to be used as a magic bullet to determine the standard of review in every situation. Second, this fix proves inadequate to the task, because it is actually impossible to account in advance for the variety of different questions that arise about the powers of various statutory decision-makers. Third, commentators and lower courts start to complain about the difficulty of applying the Supreme Court’s analysis and, fourth, the Supreme Court takes up some cases and starts the process all over again.
Perhaps the clearest example of the confusion in administrative law arises when the question before a court is whether an administrative decision-maker has exceeded its statutory powers. When this happens, the challenging party inevitably tries to characterize the question as “jurisdictional,” and therefore reviewable for correctness, while the government invariably argues that as long as the decision-maker has the right to hear and decide the question in the first place, the answer to that question depends purely on an interpretation of the enabling statute, and is therefore entitled to deference.
Federal Court of Appeal Ruling
The Federal Court of Appeal’s recent decision in Bell Canada v. 7265921 Canada Ltd.2 shows that, whatever pessimism we might have about the Supreme Court actually improving things over the long run, the current approach is not working. A panel of three experienced Court of Appeal judges writing three separate opinions is often a red flag that an area of law has grown too complex to be practical or workable.
The decision arose out of a decision of the Canadian Radio-television and Telecommunications Commission (CRTC) to impose a policy that governed contracts between two different types of commercial entities that are involved in providing television services to Canadians: (1) “programming undertakings” (PUs) which create content for television; and (2) “broadcasting distribution undertakings” (BDUs), which transmit that content to Canadians via cable, satellites or broadband. The CRTC policy, known as the 2015 Wholesale Code, is binding on BDUs and requires them to distribute programing in accordance with certain terms and conditions. Among other things, it prohibits certain “commercially unreasonable practices” and requires BDUs to consider these practices when negotiating agreements.
The Standard of Review is like the weather in a Canadian winter: lots of people talk about it but no one ever does anything to make it better.
Bell Canada and Bell Media Inc. appealed the CRTC’s decision to make the Code binding, arguing, among other things, the CRTC has no statutory authority under the Broadcasting Act to interfere in the economic relationship between BDUs and PUs. It argued that since the issue was whether the CRTC had jurisdiction to make its decision, its decision should be reviewed on a correctness standard. In contrast, the respondents argued that the issue was simply the CRTC’s interpretation of the Broadcasting Act, which ought to attract deference.
Justice Rennie, who wrote a lengthy decision in dissent, thoroughly canvassed the law on the standard of review. He quoted the Supreme Court as saying “the distinction between matters of statutory interpretation which implicate truly jurisdictional questions and those going solely to a statutory delegate’s application of its enabling statute will be, at best, elusive.”3 However, Justice Rennie cautioned that the difficulty in identifying questions of jurisdiction cannot be used to minimize their importance. Rather, all exercises of power by administrative decision-makers must be authorized by law and it is the courts who get the last word on that topic. Ultimately, he suggested the “intensity of review” should be evaluated on a spectrum—the closer the question at issue relates to jurisdiction, the closer the review should come to correctness.4 In this case, he held that whether the CRTC had the power to make the Wholesale Code binding “is a ‘reasonableness’ exercise for which there can be only one answer.”5 His answer was yes, based on Parliamentary intention of the Broadcasting Act.
While the majority reached a different result, it did so for totally different reasons. Justice Woods agreed with Justice Rennie’s approach to the standard of review, but held that the CRTC’s interpretation could not stand as it was not reasonable based on the “ordinary meaning” of the Broadcasting Act. Justice Nadon noted that “[j]udicial review, to put it mildly, is in an incoherent and confused state which undermines the predictability of outcomes and undermines the rule of law.” Having made his point, he held that the correct standard of review had to be correctness, and agreed with Justice Woods that the Broadcasting Act does not allow the CRTC to impose the Wholesale Code.
The Standard of Review is like the weather in a Canadian winter: lots of people talk about it but no one ever does anything to make it better. The question for anyone affected by administrative action in 2018 is this: will Dicey’s Comet permanently brighten the landscape, or will it be merely a fleeting presence, leaving us to contemplate the same questions, perhaps with different buzzwords, until it returns again sometime around 2028. Stay tuned.
1 A.V. Dicey was an English legal scholar who popularized the concept of the “rule of law,” and provided the intellectual foundation for much of modern administrative law.
2 2018 FCA 174
3 Ibid. at para. 41, quoting Brown J. in West Fraser Mills Ltd. v. British Columbia (Workers’ Compensation Appeal Tribunal), 2018 SCC 22.
4 Ibid. at paras. 51, 53
5 Ibid. at para. 99
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