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Fairness - SOR
MORE CASES
Part 2
. Canada v. Bowker
In Canada v. Bowker (Fed CA, 2023) the Federal Court of Appeal considered a Crown appeal from a Tax Court cost award. In this quote the court considers the 'location' of fairness violations in administrative law, particularly it's relation to abuse of process and the appellate standard of review:[16] In its most recent pronouncement on the subject, the Supreme Court has held that questions of procedural fairness are legal questions to be reviewed on the correctness standard: Law Society of Saskatchewan v. Abrametz, 2022 SCC 29, 470 D.L.R. (4th) 328 (Abrametz), at paras. 26-30. The issue in that case was whether the Law Society’s conduct amounted to an abuse of process. While not every instance of procedural fairness amounts to an abuse of process, every abuse of process amounts to a breach of procedural fairness: Blencoe v. British Columbia (Human Rights Commission), 2000 SCC 44, [2000] 2 S.C.R. 307 at paras. 151-155 (per Lebel J. dissenting, but not on this point). As a result, any debate as to whether questions of procedural fairness are questions of law reviewable on the standard of correctness – see Hussey v. Bell Mobility Inc., 2022 FCA 95, 2022 C.L.L.C. 210-052 at para. 24, Canadian Pacific Railway Company v. Canada (Attorney General), 2018 FCA 69, [2019] 1 F.C.R. 121 at paras. 54-56 – has been put to rest. . All Communications Network of Canada v. Planet Energy Corp.
In All Communications Network of Canada v. Planet Energy Corp. (Ont CA, 2023) the Court of Appeal considered the SOR that applies to an appeal allegation that an arbitrator made it such that the appellant was 'unable to present its case', which the court first interpreted as a failure of 'due process' [para 42] and ultimately as a failure of fairness [para 46]. I find the case odd since - if it's truly a matter of 'fairness' - then it should have *no* SOR (which is equivalent to 'correctness'), as opposed to the high deference set out in para 42:[12] Planet brought an application to the Superior Court to set aside the arbitral award on the basis that, among other things, the arbitrator deprived Planet of the opportunity to present its case, and the award to ACN was contrary to public policy because it violated the Energy Consumer Protection Act, 2010, S.O. 2010, c. 8 (“ECPA”). ACN brought a separate application for an order recognizing and enforcing the award.
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1. Standard of Review where a Party Claims it was Unable to Present its Case
[39] The first issue raised on this appeal is the standard of review to be applied to the application judge’s analysis of whether Planet was unable to present its case.
[40] Planet does not challenge the arbitrator’s jurisdiction to hear the case; rather, Planet challenges the arbitrator’s decisions regarding document production, time for cross-examination, and opportunity to prepare closing submissions to the arbitration that Planet claims resulted in its inability to properly present its case at the arbitration.
[41] Planet claims that the application judge was required to conduct a de novo hearing to determine whether Planet was able to present its case, and that he erred by failing “to independently assess the importance of document discovery and the prejudicial effect” of ACN’s failure to comply with its obligations to Planet, and instead, deferred to the arbitrator. Planet claims that, had the application judge conducted a de novo hearing, he would have concluded that Planet was unable to present its case.
[42] The onus on a party seeking to set aside an arbitral award on the basis of a failure of due process, is high. “Judicial intervention for alleged violations of the due process requirements of the Model Law will be warranted only when the Tribunal's conduct is so serious that it cannot be condoned under the law of the enforcing State”: Consolidated Contractors Groups S.A.L. (Offshore) v. Ambatovy Minerals S.A., 2017 ONCA 939, 70 C.L.R. (4th) 51, at para. 65, leave to appeal refused, 2018 CanLII 99661 (SCC), citing Lax J. in Corporacion Transnacional de Inversiones, S.A. de C.V. v. STET International, S.p.A., 1999 CanLII 14819 (ON SC), [1999] O.J. No. 3573, at para. 34 (Sp. Ct.), aff’d (2000) 2000 CanLII 16840 (ON CA), 49 O.R. (3d) 414 (C.A.), leave to appeal refused, [2000] S.C.C.A. No. 581.
[43] The only authority cited by Planet in support of its claim that a de novo hearing should have been conducted by the application judge to determine whether this high threshold has been met, was lululemon athletica Canada inc. v. Industrial Color Productions Inc., 2021 BCCA 428.
[44] In my view, lululemon is distinguishable.
[45] In lululemon, the appellant challenged the jurisdiction of the arbitral decision. Lululemon invoked s. 34(2)(a)(iv) of British Columbia’s legislation which, like the wording in s. 34(2)(a)(iii) of the Ontario Act, concerns “disputes not contemplated by or not falling within the terms of the submission to arbitration: see s. 34(2)(a)(iv) of British Columbia’s International Commercial Arbitration Act, R.S.B.C. 1996, c. 233.
[46] In this case by contrast, the appellant challenges the procedural fairness of the proceeding.
[47] Moreover, as was made clear by this court in United Mexican States v. Cargill, Inc., 2011 ONCA 622, 107 O.R. (3d) 528, at para. 47, leave to appeal refused, [2011] S.C.C.A. No. 528, even in appeals of pure jurisdictional questions,[C]ourts are to be circumspect in their approach to determining whether an error alleged under art. 34(2)(a)(iii) properly falls within that provision and is a true question of jurisdiction. They are obliged to take a narrow view of the extent of any such question. And when they do identify such an issue, they are to carefully limit the issue they address to ensure that they do not, advertently or inadvertently, stray into the merits of the question that was decided by the tribunal. [48] The correct test is whether the arbitrator’s decisions respecting document production, cross-examination of witnesses, and closing submissions, “offend our most basic notions of morality and justice” such that the arbitrator committed a breach of procedural fairness: Consolidated Contractors, at para. 65.
[49] It was incumbent on Planet to demonstrate that it was unable to present its case. In the absence of evidence to demonstrate how the arbitrator erred in making her findings in respect of the documents, and why more time was needed to prepare cross-examinations and make closing submissions, the application judge was entitled to rely on the findings of the arbitrator. Even if a de novo hearing were conducted, as the application judge said, “Planet’s submissions … repeat the same submissions that were made to the Arbitrator”, Planet has not challenged the finding that only eight of the 400 Xoom Documents were relevant, and no new evidence has been adduced to demonstrate how it has been deprived of its ability to present its case. As such, this would not have changed the result.
[50] For these reasons, I find that the application judge applied the correct test and invoked the correct standard of review. I would therefore dismiss this first ground of appeal. . Lacroix v. Central-McKinlay International Ltd.
In Lacroix v. Central-McKinlay International Ltd. (Div Ct, 2022) the Divisional Court affirmed that RTA s.210's appeal limitation to 'questions of law' covers procedural fairness, and that procedural fairness is assessed on an objective standard:[9] This court has jurisdiction over this appeal by virtue of s.210 of the Residential Tenancies Act, 2006, SO 2006, c.17, which provides for an appeal to this court from an LTB order solely on a question of law. Procedural unfairness is considered a question of law for the purposes of s.210.
[10] The standard of review for questions of procedural fairness is “fairness”, sometimes understood as “correctness”. The court determines whether fairness has been accorded to the appellant based on the events as they unfolded, basic principles of fairness as developed in the jurisprudence, and the tribunal’s own rules and procedures: Baker v. Canada (Minister of Citizenship and Immigration), 1999 CanLII 699 (SCC), [1999] 2 SCR 817; Peel Housing Cooperative o/a Peel Living v. Sharpe, 2017 ONSC 6303, per F.B. Fitzpatrick J. (Div. Ct.).
Fresh Evidence
[11] The tenant seeks to adduce as fresh evidence an affidavit setting out his internal thought processes at the hearing. We would not admit this fresh evidence for three reasons:(a) the proposed fresh evidence does not shed light on events at the hearing in a manner bearing on procedural fairness.
(b) the tenant’s internal thought processes are not relevant to an issue before this court. Procedural fairness is assessed on an objective standard. ... . Lengyel v. The Licence Appeal Tribunal et al.
In Lengyel v. The Licence Appeal Tribunal et al. (Div Court, 2023) the Divisional Court held that an appeal or judicial review for 'fairness' was conducted under the same standard, whether it was characterized as 'not having a standard of review' or 'correctness':[16] On allegations of procedural fairness in the context of a judicial review I adopt the comments of Sachs, J. in the matter of Khorsand v. Police Services Board 2023 ONSC 1270 at para. 33:In Mission Institution v. Khela, 2014 SCC 24, [2014] 1 S.C.R. 502, the Supreme Court made the same finding with respect to applications for judicial review that raised issues of procedural fairness. Since Khela Ontario courts have been divided – some having applied the correctness standard of review to issues of procedural fairness and some having held that there is no need for a standard of review analysis when it comes to issues of procedural fairness – a decision is either procedurally fair or it is not. In my view, there is little practical difference between these articulations. A reviewing court does not accord deference to decisions that impact procedural fairness. . Watson v. Canadian Union of Public Employees
In Watson v. Canadian Union of Public Employees (Fed CA, 2023) the Federal Court of Appeal commented on the interaction of administrative fairness law with standards of review, here in a JR application:[17] When assessing general issues of procedural fairness, the Court is to ask whether the proceedings were fair in all of the circumstances (Canadian Pacific Railway Company v. Canada (Attorney General), 2018 FCA 69, [2019] 1 F.C.R. 121 at paras. 54-56 [Canadian Pacific]). As explained in Canadian Pacific, the concept of a standard of review is ill-fitted to assessments of procedural fairness. A proceeding is either fair or it is not, a test that is otherwise best described or captured as a correctness standard. When reviewing the Board’s decision not to hold an oral hearing under section 16.1 of the Code, this Court may only intervene where the decision to proceed on the basis of the written record did not allow a party to fully assert their rights or to know the evidence that they must refute (Ducharme c. Air Transat A.T. Inc., 2021 CAF 34, [2021] A.C.F. No. 173 (QL) at para. 19 [Ducharme]). . Del Grande v. Toronto Catholic District School Board
In Del Grande v. Toronto Catholic District School Board (Div Court, 2023) the Divisional Court considered the SOR (or rather the lack of an SOR) applicable to issues of fairness in court review, both for an appeal and a JR (here it was in a JR):[38] The parties agreed that no standard of review analysis is required on matters of procedural fairness, which are determined with reference to the non-exhaustive list of considerations set out in Baker v. Canada (Minister of Citizenship and Immigration, 1999 CanLII 699 (SCC), [1999] 2 S.C.R. 817, at para. 23. More recently, the Supreme Court of Canada has clarified in Law Society of Saskatchewan v. Abrametz, 2022 SCC 29, 470 DLR (4th) 328, at para. 30, that the standard of review applicable to matters of procedural fairness is correctness. . Draxl v. Truevine
In Draxl v. Truevine (Div Court, 2022) the Divisional Court denies a motion to quash an RTA s.210 appeal, partially on the grounds that issues of procedural fairness are issues of law [RTA 210 only allows Divisional Court appeals on 'questions of law']:[15] With respect to the question of whether this appeal is devoid of merit, the landlord submits that it is because no question of law is raised in the appeal. Under the Residential Tenancies Act, 2006, S.O. 2006, c. 17 (“RTA”) appeals from the LTB to this court are limited to questions of law.
[16] There are a couple of difficulties with this submission. First, one of the two issues raised by the tenant is a procedural fairness issue. A procedural fairness issue is treated as a question of law for the purposes of the right of appeal under the RTA. The landlord’s submission in that regard is that even if it is a question of law, it is devoid of merit.
[17] The second issue – whether or not there was a settlement – is certainly not a pure question of law. For an appeal to be entertained on that question, the tenant must show that there is an extricable question of law in what is otherwise an issue of mixed fact and law.
[18] Going back to the question of whether this appeal is devoid of merit, it is not for me to say on this motion what the chances of success are. But I am not prepared to find that the appeal meets the very high threshold needed to be quashed in the circumstances before me today.
[19] I move then to the abuse of process submission, based on the failure to promptly pay rent and also to meet the obligation to pay arrears as set out in the directions given at the above case conference. . Peel Standard Condominium Corporation No. 779 v. Rahman
In Peel Standard Condominium Corporation No. 779 v. Rahman (Div Ct, 2021) the Divisional Court held that issues of administrative fairness were also issues of law:[18] In Tipping v. Coseco Insurance Company the court held at para. 41 that: “Procedural fairness and natural justice, including allegations of bias, are questions of law. An appeal from the LAT on those issues is therefore an obvious adequate alternative remedy.” The same applies to an appeal from the CAT. .... . Carr v. Brown
In Carr v. Brown (Div Court, 2022) the Divisional Court held that a fairness breach was an error of law, and thus within the court's jurisdiction under RTA 210:[7] Issues of procedural fairness do fall within this Court’s jurisdiction. A failure on the part of the Board to ensure that a hearing is procedurally fair is an error of law: Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury Board), 2011 SCC 62 at para. 22, Tipping v Coseco Insurance Co, 2021 ONSC 5295, at para. 41, 2276761 Ontario Inc. v. Overall, 2018 ONSC 3264 at para. 8. . Ahousaht First Nation v. Canada (Indian Affairs and Northern Development)
In Ahousaht First Nation v. Canada (Indian Affairs and Northern Development) (Fed CA, 2021) the Federal Court of Appeal noted that the standard of review for administrative fairness is in effect one of 'correctness':[31] The standard of review on issues of procedural fairness is essentially correctness: Mission Institution v. Khela, 2014 SCC 24, [2014] 1 S.C.R. 502 at para. 79. As stated in Vidéotron Ltée v. Canada (Shared Services), 2019 FCA 307, 313 A.C.W.S. (3d) 299 at para. 12:Issues of procedural fairness are to be reviewed on a correctness standard. While it may be that “no standard of review is being applied” when a court considers issues of procedural fairness because the question is “whether the procedure was fair having regard to all the circumstances,” this Court’s review is “best reflected in the correctness standard” for such issues (Canadian Pacific Railway Company v. Canada (Attorney General), 2018 FCA 69, [2018] F.C.J. No. 382 at para. 54). . 1582235 Ontario Limited v. Ontario
In 1582235 Ontario Limited v. Ontario (Ont CA, 2020) the Divisional Court stated the standard of review when deciding issues of administrative procedural fairness:[19] The parties agree that there is no standard of review in respect of procedural fairness issues. Rather, it is for the court to determine whether the requisite level of procedural fairness has been accorded, taking into account the factors in Baker v. Canada (Minister of Citizenship and Immigration.[4] . Canadian Pacific Railway Company v. Canada (Transportation Agency)
In Canadian Pacific Railway Company v. Canada (Transportation Agency) (Fed CA, 2021) the Federal Court of Appeal (Pelletier JA) expands interestingly on the normal 'there is no standard of review on fairness issues'. Here appeal was allowed only on questions of law and jurisdiction, and the court held that whether procedural fairness was owed was a matter of law - but whether it was breached was a matter of mixed law and fact [see para 42]:[41] Since this is a statutory appeal pursuant to subsection 41(1) of the Act, the standard of review is the appellate standard, namely correctness on questions of law: see Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, 441 D.L.R. (4th) 1, at paras. 18, 36-37 and 50 [Vavilov]. Since there is no right of appeal from decisions of the Agency on questions of fact and mixed law and fact, this is sufficient to dispose of the issue of the standard of review on substantive questions.
[42] That leaves the question of the nature of questions of procedural fairness, a question which is raised by the statutory exclusion of a right of appeal on questions of mixed fact and law. Subsection 41(1) limits the right of appeal to this Court to questions of law and jurisdiction. Whether a person is owed a duty of fairness is a question of law, while whether that duty has been breached is a question of mixed fact and law. At first blush then, this Court could determine whether a duty of fairness was owed but not whether it was breached. This would bifurcate questions of procedural fairness, with this Court dealing with the legal question and the Governor in Council dealing with the question of whether the duty of fairness found by this Court had been breached: see section 40 of the Act. Such a result is inimical to any notion of a practical and efficient system of justice.
[43] As the Supreme Court observed at paragraph 19 of Canada (Attorney General) v. TeleZone Inc., 2010 SCC 62, [2010] 3 S.C.R. 585: "“Access to justice requires that the claimant be permitted to pursue its chosen remedy directly and, to the greatest extent possible, without procedural detours.”"
[44] However, a careful reading of sections 40-43 of the Act discloses that Parliament intended this Court to deal with questions of procedural fairness comprehensively. That careful reading was undertaken by this Court, per Stratas J.A., in Canadian National Railway Company v. Emerson Milling Inc., 2017 FCA 79, [2018] 2 F.C.R. 573, paras. 6-57 [Emerson].
[45] The Court reasoned that since the Supreme Court teaches that questions of jurisdiction are essentially questions of statutory interpretation and thus, questions of law, the phrase "“a question of law or a question of jurisdiction”" contains a redundancy. On the theory that Parliament does not deal in redundancies, the Court examined the scope of "“a question of jurisdiction”" and concluded that, historically, jurisdiction included questions of procedural fairness, citing the Toronto Newspaper Guild case, 1953 CanLII 10 (SCC), [1953] 2 S.C.R. 18, [1953] 3 D.L.R. 561. This was the state of affairs when the predecessor of subsection 41(1) was included in the predecessor to the Act, the National Transportation Act, R.S.C., 1985, c. N‑20. Since the phrase "“on a question of law or a question of jurisdiction”" has remained in the Act ever since, it is reasonable to conclude that Parliament intended to continue to treat procedural fairness as an aspect of jurisdiction which means that questions of procedural fairness, even though factually suffused as noted above, can be appealed to this Court which can then deal with them comprehensively: see Emerson at para. 19.
[46] Vavilov did not address the standard of review for questions of procedural fairness, an issue on which the courts have variously said that there is no standard of review or that the standard is correctness. In Canadian Pacific Railway Company v. Canada (Attorney General), 2018 FCA 69, [2019] 1 F.C.R. 121, at paras. 33-56 [CPR v. Canada] this Court, per Rennie J.A., canvassed this issue and concluded as follows:A court assessing a procedural fairness argument is required to ask whether the procedure was fair having regard to all of the circumstances, including the Baker factors. A reviewing court does that which reviewing courts have done since Nicholson; it asks, with a sharp focus on the nature of the substantive rights involved and the consequences for an individual, whether a fair and just process was followed. I agree with Caldwell J.A.’s observation in Eagle’s Nest (at para. 20) that, even though there is awkwardness in the use of the terminology, this reviewing exercise is “best reflected in the correctness standard” even though, strictly speaking, no standard of review is being applied.
CPR v. Canada, at para. 54 [47] With that in mind, I propose to address questions of procedural fairness by asking whether a fair and just procedure was followed, which, as noted in the passage quoted above, captures what is caught, though awkwardly, by the use of "“correctness standard”" in the context of procedural fairness. . Lockyear v. Wawanesa Mutual Insurance Company
In Lockyear v. Wawanesa Mutual Insurance Company (Div Ct, 2021) the Divisional Court characterizes the duty of procedural fairness from an appellate standard of review perspective:[24] It may be obvious to some, but bears noting that the issue of procedural fairness, while an issue of law[23], stands apart. This is not like the interpretation of a statute or the explanation of a common law principle. Procedural fairness is attached to a foundational right, a principle of natural justice, the right to be heard (audi alteram partem):The principle that the individual or individuals affected by a decision should have the opportunity to present their case fully and fairly underlies the duty of procedural fairness and is rooted in the right to be heard.[24] [25] The right to be heard is fundamental to Canadian administrative law:From these foundational cases, procedural fairness has grown to become a central principle of Canadian administrative law. Its overarching purpose is not difficult to discern: administrative decision makers, in the exercise of public powers, should act fairly in coming to decisions that affect the interests of individuals. In other words, “[t]he observance of fair procedures is central to the notion of the ‘just’ exercise of power” [25] [26] The ultimate protection of this right rests with the courts:…a fair procedure is said to be the handmaiden of justice. Accordingly, procedural limits are placed on administrative bodies by statute and the common law. These include the requirements of “procedural fairness”, which will vary with the type of decision maker and the type of decision under review. On such matters, as well, the courts have the final say. The need for such procedural safeguards is obvious. Nobody should have his or her rights, interests or privileges adversely dealt with by an unjust process.[26] [27] This being so, referred to as correctness or otherwise, the standard of review applicable to procedural fairness is absolute. A proceeding is either fair or it is not:…the denial of a right to a fair hearing must always render a decision invalid, whether or not it may appear to a reviewing court that the hearing would likely have resulted in a different decision. The right to a fair hearing must be regarded as an independent, unqualified right which finds its essential justification in the sense of procedural justice which any person affected by an administrative decision is entitled to have.[27]
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When considering an allegation of a denial of natural justice, a court need not engage in an assessment of the appropriate standard of review. Rather, the court is required to evaluate whether the rules of procedural fairness or the duty of fairness have been adhered to. The court does this by assessing the specific circumstances giving rise to the allegation and by determining what procedures and safeguards were required in those circumstances in order to comply with the duty to act fairly.[28] . Denso Manufacturing Canada, Inc. v. Canada (National Revenue)
In Denso Manufacturing Canada, Inc. v. Canada (National Revenue) (Fed CA, 2021) the Federal Court of Appeal held that there was no deference on an appeal from a judicial review on the issue of fairness:[35] It is not clear whether the reference to a de novo review of the administrative decision would also mean a de novo review of the issue of procedural fairness. This Court, in Canadian Pacific Railway Company v. Canada (Attorney General), 2018 FCA 69, noted:[54] A court assessing a procedural fairness argument is required to ask whether the procedure was fair having regard to all of the circumstances, including the Baker factors. A reviewing court does that which reviewing courts have done since Nicholson; it asks, with a sharp focus on the nature of the substantive rights involved and the consequences for an individual, whether a fair and just process was followed. I agree with Caldwell J.A.'s observation in Eagle's Nest (at para. 20) that, even though there is awkwardness in the use of the terminology, this reviewing exercise is "best reflected in the correctness standard" even though, strictly speaking, no standard of review is being applied.
[55] Attempting to shoehorn the question of procedural fairness into a standard of review analysis is also, at the end of the day, an unprofitable exercise. Procedural review and substantive review serve different objectives in administrative law. While there is overlap, the former focuses on the nature of the rights involved and the consequences for affected parties, while the latter focuses on the relationship between the court and the administrative decision maker. Further, certain procedural matters do not lend themselves to a standard of review analysis at all, such as when bias is alleged. As Suresh demonstrates, the distinction between substantive and procedural review and the ability of a court to tailor remedies appropriate to each is a useful tool in the judicial toolbox, and, in my view, there are no compelling reasons why it should be jettisoned.
[56] No matter how much deference is accorded administrative tribunals in the exercise of their discretion to make procedural choices, the ultimate question remains whether the applicant knew the case to meet and had a full and fair chance to respond. It would be problematic if an a priori decision as to whether the standard of review is correctness or reasonableness generated a different answer to what is a singular question that is fundamental to the concept of justice – was the party given a right to be heard and the opportunity to know the case against them? Procedural fairness is not sacrificed on the altar of deference. [36] Since the question for procedural fairness is whether the procedure was fair, it is a moot point whether this Court conducts a de novo review of the issue of procedural fairness or reviews the decision of the Federal Court on the procedural fairness issue. In either approach, no deference would be shown to the decision of Federal Court on the issue of procedural fairness.
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