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JR - AAR (6). Binance Holdings Limited v. Ontario Securities Commission
In Binance Holdings Limited v. Ontario Securities Commission (Ont CA, 2025) the Ontario Court of Appeal allowed joined appeals, here brought against investigative administrative "summons demanding the production of documents and, depending on how the summons is interpreted, responses to interrogatories (“information”) from Binance about its operations ...".
The court considered the propriety of the Divisional Court discretionarily declining to hear a judicial review, here on purported 'adequate alternative remedy' grounds:C. Did the Divisional Court err in declining judicial review of the Charter arguments?
[67] I am persuaded that the Divisional Court erred in principle in declining judicial review of Binance’s Charter arguments relating to the constitutional validity of the seizure. Although it would have been entitled to deny judicial review on the basis that Binance has an alternative path to obtaining adequate relief on these issues, it denied judicial review based on a mere possibility that Binance might have an alternative path to obtaining relief. It also did so without any exploration of the adequacy of that relief if it did prove to be available. In my view, this was not a proper basis for exercising discretion to deny judicial review. I am also persuaded that even if it had not been an error in principle for the Divisional Court to deny judicial review on the basis it did, its decision to do so was an unreasonable exercise of discretion. I would not defer to its decision.
[68] I recognize that judicial review “has always been understood to be discretionary” and that “the broadest judicial discretion may be exercised in determining whether a case is one in which declaratory relief ought to be awarded”: Strickland v. Canada (Attorney General), 2015 SCC 37, [2015] 2 S.C.R. 713, at para. 37. This does not mean that the discretion not to undertake judicial review is immune from appellate oversight. Rather, “the exercise of discretion can be set aside when a judge ‘considered irrelevant factors, failed to consider relevant factors, or reached an unreasonable conclusion’”, or when a judge declines judicial review “on the basis of a ‘wrong principle’”: Yatar v. TD Insurance Meloche Monnex, 2024 SCC 8, at para. 41, referring to Canadian Pacific Ltd. v. Matsqui Indian Band, 1995 CanLII 145 (SCC), [1995] 1 S.C.R. 3, at paras. 39, 112.
[69] To be sure, there is a “well-established discretion to decline to undertake judicial review when some other, more suitable remedy is available” (emphasis added): Strickland, at para. 1. As Cromwell J. put it in Strickland, at para. 40, “[o]ne of the discretionary grounds for refusing to undertake judicial review is that there is an adequate alternative” (emphasis added). The test that he adopted for denying judicial review on this basis is premised on there being an alternative remedy available, as it asks: “is the alternative remedy adequate in all the circumstances to address the applicant’s grievance?” (emphasis in original): Strickland, at para. 42. There are therefore two parts to the test, the necessarily implicit part that there must be an alternative basis for obtaining the relief sought, and the second explicit part that requires that alternative basis to be “adequate”. It is instructive that in Strickland, before finding that deference should be given to a decision to decline judicial review based on an adequate alternative remedy, Cromwell J. engaged in a close, careful, and complete analysis of the jurisdiction of the proposed alternative decision maker (provincial superior courts) to address the vires of the Federal Child Support Guidelines, SOR/97-175. It was only after doing so and finding that the Federal Court’s premise that the provincial superior courts had such jurisdiction was “correct” that he deferred to the discretionary determination of the Federal Court to decline judicial review based on an alternative adequate remedy.
[70] As I have explained in para. 67 above, in this case, the Divisional Court declined judicial review of the constitutional issues without finding that Binance had access to an alternative remedy from another tribunal, on the basis that Binance had not attempted to have the Commission exercise jurisdiction to grant an alternative remedy. And it did so without exploring whether any remedy the Commission might provide would be “adequate”. It therefore exercised its discretion to deny judicial review based on the mere possibility of an alternative remedy, rather than on the basis that there was an adequate alternative remedy. It failed to apply either of the two parts of the Strickland test.
[71] The Commission argues that the Divisional Court was not required to apply the Strickland test in exercising its discretion because Cromwell J. made clear in that case that courts are not required to apply the Strickland factors as a “checklist”: Strickland, at para. 43. I do not accept this submission. Cromwell J. prefaced that comment, at para. 42, by making clear that the factors he was referring to were “a number of considerations” that he had listed as “relevant to deciding whether an alternative remedy or forum is adequate so as to justify a discretionary refusal to hear a judicial review application.” Those principles have nothing to do with the first part of the Strickland test, namely, whether there an alternative remedy exists. Moreover, although Strickland holds that the considerations listed in para. 42 need not be used as a checklist when applying the second part of the test by inquiring into the adequacy of an alternative remedy, it does not hold that a court is entitled to disregard entirely the adequacy of the proposed alternative remedy. Strickland requires that this issue be resolved, but the Divisional Court did not do so.
[72] I am therefore persuaded that the Divisional Court erred in principle in declining judicial review, and I would allow Binance’s appeal of its decision on this basis.
[73] In the alternative, I am persuaded that even if these shortcomings had not amounted to an error in principle, the decision of the Divisional Court to decline to undertake judicial review on the constitutional issues in the circumstances of this case was nonetheless an unreasonable exercise of discretion, not warranting deference. The Divisional Court was aware of the Commission’s position that an application to the Commission would be unproductive because it had already ruled at least twice that it did not have the jurisdiction to revoke or vary a summons. The Divisional Court was also aware that there was no stay of the Summons in place and that Binance was seeking a ruling on the constitutional validity of the Summons before engaging the expensive and time-consuming enterprise of delivering masses of documents within a short timeline. The Divisional Court certainly understood that if it declined judicial review Binance would be obliged, on pain of a contempt hearing, to continue to comply with the Summons that it believed to be unconstitutional until the Commission could render a decision on its jurisdiction at some unknown point in the future. Finally, the Divisional Court had to have been aware that if the Commission ultimately declined jurisdiction to provide an alternative remedy, no record of proceedings would be created addressing the constitutional issue, and no decision would be made on the merits by an administrative decision-maker. The application before it would therefore likely return on much the same record that the Divisional Court already had before it, after further delay and expense.
[74] Yet the Divisional Court chose to accept these risks based on nothing more than speculation that requiring Binance to bring its s. 144(1) application to the Commission could possibly produce a more complete record and result in a decision of the regulator. In my view, it was not reasonable for the Divisional Court to undertake these risks without resolving whether the Commission in fact had jurisdiction, and without considering the adequacy of the Commission’s ability to respond to the concerns that Binance was raising. In Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, at para. 27, the Supreme Court affirmed that, “Judicial review seeks to address an underlying tension between the rule of law and the foundational democratic principle, which finds expression in the initiatives of Parliament and legislatures to create various administrative bodies and endow them with broad powers.” In my view, the decision to deny Binance the opportunity to do address that tension without first determining that a s. 144(1) application to the Commission was an alternative and adequate mechanism for doing so, was not a reasonable exercise of discretion.
[75] I would allow this ground of appeal. . Morgenthau v. Toronto Metropolitan University [Strickland 'factors'; remedies need not be the same across alternative proceedings]
In Morgenthau v. Toronto Metropolitan University (Ont Div Ct, 2025) the Ontario Divisional Court dismissed a JR, here against a TMU decision that "informed the applicant that it would not be proceeding with the investigation of her complaint because it had determined that the MacDonald Report and the External Review had fully and appropriately addressed the substantive issue raised in the complaint", which "could not be appealed because it was a preliminary assessment that was not subject to appeal under either the Student Code of Conduct or the Discrimination and Harassment Prevention Policy".
Here the court extensively considers the Strickland (SCC, 2015) 'adequate alternative remedy' doctrine (an aspect of 'exhaustion doctrine') - including reference to a list of Strickland 'factors', the 'balance of convenience' between the competing proceedings, and the doctrine that the remedy in the alternative proceeding need not be identical to that of the sought proceeding (for the AAR doctrine to apply against the applicant) [see para 59 below]:[45] As stated by the Supreme Court of Canada in Strickland: “[t]his means that that even if the applicant makes out a case for review on the merits, the reviewing court has an overriding discretion to refuse relief”.[11] In Strickland, an application for judicial review had been brought in Federal Court challenging the Federal Child Support Guidelines, SOR/97-175. The Federal Court exercised its discretion to decline to undertake judicial review primarily based on the fact that there was an alternative to judicial review, which was to challenge the Guidelines in the provincial superior courts. The Supreme Court agreed, stating that the greater expertise of provincial superior courts in family law made it a better choice than judicial review for challenging the legality of the Guidelines.
[46] In Strickland, the Supreme Court based its decision for refusing to undertake judicial review on the fact that there was an adequate alternative to judicial review.[12] The courts have identified other grounds for declining to undertake judicial review including prematurity, mootness and delay in commencing judicial review.[13]
[47] In the present case, the Panel declined to undertake judicial review because it is not appropriate for this court to second guess TMU’s decision not to discipline the students who participated in the Open Letter. There are alternative forums for the applicant to pursue her complaints of harassment and discrimination which are preferable to judicial review when considered in the context of the particular circumstances of this case, and the policy considerations behind the legislative scheme. The following analysis explains why judicial review is not appropriate in the present case.
[48] In Strickland, the Supreme Court provided a list of factors to consider in deciding whether an alternative remedy or forum is adequate so as to justify a discretionary refusal to hear a judicial review application:(i) The convenience of the alternative remedy;
(ii) the nature of the error alleged;
(iii) the nature of the other forum which could deal with the issue, including its remedial capacity;
(iv) the existence of adequate and effective recourse in the forum in which litigation is already taking place;
(v) expeditiousness;
(vi) the relative expertise of the alternative decision-maker;
(vii) economical use of judicial resources; and
(viii) cost.[14] [49] The Supreme Court emphasized that the above-noted factors are not to be treated as a checklist. The inquiry is broader than a summary of differences and similarities. The appropriateness of both the available alternatives and the application for judicial review should be considered, which calls for a balance of convenience analysis. This balancing exercise should take account of the purposes and policy considerations underpinning the legislative scheme in issue.[15] It should also include a consideration of any disproportionate impact on the parties or the interests of third parties.[16]
[50] However, the Supreme Court’s instructions in Yatar and Vavilov also make it clear that although the court retains the discretion to refuse to grant a remedy when there are suitable alternate forums including a statutory forum, it cannot do so merely because a limited right of appeal evinces an intention to restrict recourse to the courts on other questions arising from an administrative decision.[17]
[51] As the Supreme Court stated in Yatar, those whose interests have been decided by a statutory delegate must have a meaningful and adequate means to challenge decisions that they consider to be unreasonable having regard to their substance and justification or considerations of procedural fairness.[18]
[52] Nevertheless, it is important to bear in mind that “the discretionary nature of [judicial review] reflects the fact that unlike private law, its orientation is not, and never has been, directed exclusively to vindicating the rights of individuals”.[19] Rather, judicial review is a public law remedy, directed at ensuring the lawful exercise of administrative decision-making power.
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[58] The Supreme Court made in clear in Strickland that there is no right to judicial review.[22] The court’s exercise of its discretion not to hear the judicial review application in this case does not violate the rule of law. This matter is a very complicated one which has dominated many institutions. TMU adopted a reasonable process, put resources into the review of the Open Letter and related events, and did not shirk its responsibility. In a university setting there are undoubtedly hundreds of people with concerns and perspectives about this matter. They cannot all be included as parties in the process. In these circumstances, it is not appropriate for this court, through the judicial review process, to second guess TMU’s decision not to discipline the students.
[59] The Supreme Court in Strickland also stated that the remedy available in an alternative forum need not be the claimant’s preferred remedy or identical to that which the claimant seeks by way of judicial review.[23] The remedial capacity of the alternative decision-maker is only one factor to consider in assessing adequacy. Furthermore, where there is an appropriate alternative forum that provides the litigant with an opportunity to have questions of fact, law, or mixed fact and law heard, the court may decline to hear the application for judicial review provided the other Strickland factors are met.[24]
[60] What follows [SS: at paras 61-108] is an analysis of the Strickland factors, including the remedial capacity of the alternative decision makers, demonstrating that both a human rights application and a grievance under the collective agreement are suitable alternative forums. Finally, the balance of convenience analysis reveals that both alternate forums are preferable to judicial review.
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(vii) Economical Use of Judicial Resources and Costs
[84] As the court noted in Jirousek v. Yukon (Government of), 2021 YKSC 19, at para. 27, generally speaking, court applications are more costly than administrative proceedings because of filing fees, more formal process requirements and stricter evidentiary requirements. In this case, recourse to the alternate forums would be a more economical use of judicial resources as well as reducing the costs for the parties.
[85] My analysis of the Strickland factors leads me to conclude that the alternate forums are preferable to judicial review to address the issues raised in the application. My conclusion in that regard is supported by cases like Gupta v. Canada (Attorney General), 2021 FCA 202. In that case, the Federal Court of Appeal dismissed an appeal from the Federal Court’s decision to decline to hear the appellant’s application for judicial review. Mr. Gupta sought judicial review of the employer’s decision to adopt an administrative investigation report, with the result that his request for a retroactive promotion was denied. The Federal Court premised its decision to decline judicial review on the fact that the appellant had not exhausted the alternate remedies, namely the grievance procedure available under the applicable legislation.
[86] On appeal, the appellant argued that the Federal Court failed to consider the inadequacy of the grievance procedure in light of the particular circumstances of that case, and that the Court was required to consider whether the grievance procedure provided a suitable and appropriate remedy in accordance with the principles set out in Strickland. The Federal Court of Appeal concluded that the lower court had indeed considered the suitability of the grievance procedure. At para. 7, the Federal Court of Appeal held that:... the principles governing whether the Federal Court ought to have deferred to the grievance procedure are set out in Canada (Border Services Agency) v. C.B. Powell Ltd, 2010 FCA 61, [2010] F.C.J. No. 274 [C.B. Powell]. It holds that a party may not commence an application for judicial review prior to exhausting alternate administrative remedies – like the grievance procedure – unless exceptional circumstances exist. In addition, as noted by this Court in paragraph 33 of C.B. Powell, the threshold for exceptionality is high and typically does not include denials of procedural fairness committed prior to the final administrative decision. (See also, to similar effect, Harelkin v. University of Regina, 1979 CanLII 18 (SCC), [1979] 2 S.C.R. 561, (1979), 96 D.L.R. (3d) 14, at pp. 584-585, and Nosistel v. Canada (Attorney General), 2018 FC 618, 2018 CarswellNat 10225 [Nosistel], at para. 41, upon which the Federal Court relied in the instant case). [87] A review of the Strickland factors does not end the analysis. Consideration must also be given to the balance of convenience. As noted, the question is not simply whether the other forum is adequate, but also whether judicial review is appropriate.[31]
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[93] Finally, I am required to consider the appropriateness of judicial review in the context of the statutory framework in this particular case. The question is whether judicial review is “appropriately respectful” of the statutory framework and of the “normal processes” for which it provides.[34]
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