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Stratas JA - Reasons for Decision. Jennings-Clyde (Vivatas, Inc.) v. Canada (Attorney General) [decisions/notice]
In Jennings-Clyde (Vivatas, Inc.) v. Canada (Attorney General) (Fed CA, 2025) the Federal Court of Appeal allowed an appeal, this brought against a dismissed Federal Court JR, this in turn brought against "the refusal of the Canada Revenue Agency to let the appellant file tax returns late: see subsection 220(3) [SS: 'Administration and Enforcement - Extensions for returns'] of the Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.) (the provision allowing for the exercise of discretion to allow late filings) and subsection 164(1) of the Act [SS: 'Refunds'] (the provision requiring the appellant to file its return within three years of the end of the relevant taxation year to get a refund)."
Here the court (Stratas JA) considers the appellant's argument that "it did not get an adequate explanation for the refusal from the Agency", which it finds as justified, in typical blunt Stratas fashion:[3] As a general principle, we do not allow an administrative decision-maker like the Agency to decide a matter affecting someone’s rights or practical interests unless it gives an adequate explanation for its decision, or the explanation is otherwise evident or discernable. See, generally, Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, [2019] 4 S.C.R. 653.
[4] This is no small thing. Through their decisions, administrative decision-makers like the Agency have the power to affect people’s lives, sometimes significantly. In our democratic governance, there is a quid pro quo for that: public administrative decision-makers must explain their decisions. "“""L’État, c’est moi”" and "“trust us, we got it right”" have no place in public administrative decision-making: Canada (Citizenship and Immigration) v. Tennant, 2018 FCA 132 at para. 23.
[5] And there are good practical reasons why we insist on seeing adequate explanations for administrative decisions:Adequate explanations lead often to more thinking, better thinking, and, thus, better decision-making. This is because administrative decision-makers, while they write up adequate explanations for their decisions, often discover gaps or flaws in their reasoning or the need for more submissions.
Adequate explanations tell affected persons that the administrative decision-maker took on board their key arguments and rejected them for certain reasons: this vindicates the interests served by procedural fairness.
Adequate explanations further the transparency, legitimacy and accountability of administrative decision-makers to the parties before them, other regulatees, reviewing courts, and the wider public—something needed more than ever in these days of widespread skepticism, cynicism, and mistrust of government. (See generally Canadian National Railway Company v. Canada (Transportation Agency), 2025 FCA 184 at para. 46 and cases cited therein.)
[6] In this case, the Agency concluded that the relevant taxpayer relief provision, subsection 220(3), didn’t apply. Its explanation? The appellant’s case was distinguishable from this Court’s decision in Bonnybrook Park Industrial Development Co. Ltd. v. Canada (National Revenue), 2018 FCA 136. In that case, this Court held that subsection 220(3) applied to another refund provision in the Act, subsection 129(1).
[7] The grounds for distinguishing Bonnybrook? It’s pretty much a mystery. The analysis and reasoning in support of whatever grounds the Agency was invoking? Nothing.
[8] The grounds for saying that the reasoning in Bonnybrook does not apply to subsection 164(1) of the Act, the relevant section here, a different section from that considered in Bonnybrook? Again nothing.
[9] The Canada Revenue Agency did say this to the appellant: "“subsection 220(3) may not be relied on by the Minister to exercise discretion to extend the deadline in subsection 164(1) of the Act”". Why? That’s pretty much a mystery too.
[10] On that point, the Agency offers a little more. It says that by enacting subsection 164(1.5), "“Parliament made it clear”" that subsection 220(3) was ousted. But Parliament expresses itself in words, and Parliament’s words in subsection 164(1.5) do not make that clear. So where did Parliament make it clear? Is it the context of the words in subsection 164(1.5) when seen alongside other provisions of the Act? Is it the purpose of 164(1.5)? The purpose of other provisions? Some recognized canon or maxim of statutory construction? Some earlier judicial or administrative authority? More mystery.
[11] Vavilov made it clear (at paras. 119-123) that when administrative decision-makers interpret a legislative provision, they must show a genuine, non-tendentious, explicit or implicit analysis of the text, context and purpose behind a legislative provision when interpreting it. On this, silence.
[12] But there’s still more.
[13] The Agency’s reasons say that the appellant raised Bonnybrook in its request for relief. No, it did not. At least not from anything we can see. According to the written record before us, the Agency in its final decision letter — not the appellant — was the first and only party to mention Bonnybrook.
[14] Did the Agency ask the appellant to make submissions on Bonnybrook before deciding the matter? It appears not.
[15] If in fact the appellant did raise and make submissions on Bonnybrook, for example in a phone call or email, or the Agency asked the appellant to make submissions on Bonnybrook, the Agency should have recorded this in a letter or file note and put it in the certified record of the decision-maker filed in this Court. Here, the certified record contains no such thing. Either there was no phone call or email, or the Agency did not put it in the certified record.
[16] What we have here falls below standard, especially given the six-figure amounts at stake for the taxpayer. Alas, on adequacy of reasons in taxpayer relief cases, we are seeing a disappointing recent pattern: e.g., Osbourne v. Canada (Attorney General), 2022 FC 122 at para. 37; Barrs v. Canada (National Revenue), 2022 FCA 147 at para. 38; Loyer (Succession) v. Canada (Attorney General), 2019 FC 1528 at paras. 38-40; Onex Corporation v. Canada (Attorney General), 2024 FC 1247 (albeit currently on appeal, so its placement on this list is provisional).
[17] Reviewing courts understand the pressures on the Agency. It must regulate and serve millions of taxpayers. It has a giant job to do with limited resources. No doubt, a blizzard of requests for discretionary relief and other matters buries the Agency. It has neither the time nor the resources to offer anything close to appellate court level explanations for all its decisions. It has to be fast, efficient and cost-effective.
[18] Thus, reviewing courts are fine with brevity that works. They will connect the dots on the page so to speak, as long as (unlike here) the Agency has put down the dots and it’s easy to know how to connect them: Komolafe v. Canada (Citizenship and Immigration), 2013 FC 431 at para. 11. The Agency can cross-reference with precision to explanations in particular portions of cases, key documents or taxpayer’s submissions in the record, and Agency documents like recommendation memos, interpretation bulletins, or working group conclusions, so long as those Agency documents are publicly accessible. And lastly, these days, the Agency need only invent good, plain-language reasons on a recurring issue once: they can be cut and pasted in later decisions with just a couple of keystrokes, Ctrl-C and Ctrl-V.
[19] From my own multi-decade experience with administrative decision-makers, I suspect another problem: inadequate resources and funding. If so, the Agency must complain. And those responsible for considering the complaint, including the politicians who oversee and instruct them, had better take note. Ensuring the wheels of justice, both administrative and judicial, turn quickly, adequately and properly is not a luxury, frill, or optional extra; it’s one of the most basic things governments owe to those they govern.
[20] On the issue of remedy, the Agency, not this Court, decides whether to allow for late returns under subsection 220(3). Thus, we must reject the appellant’s request that we grant it tax relief.
[21] Therefore, I would allow the appeal, set aside the judgment of the Federal Court, and grant the application for judicial review. I would order the Canada Revenue Agency to give the appellant a fair opportunity to make submissions on all relevant issues, to consider those submissions, and to redetermine the matter with adequate reasons. The appellant does not seek its costs and so I would award none. . Halton (Regional Municipality) v. Canada (Transportation Agency)
In Halton (Regional Municipality) v. Canada (Transportation Agency) (Fed CA, 2024) the Federal Court of Appeal dismissed an appeal from Ontario municipalities of a decision of the Canada Transportation Act [CTA] [s.41(1)].
Here Stratas JA expounds on the adequacy of reasons, focussing on the detail required:D. Adequacy of reasons
[21] The appellants submit that the Agency’s reasons are insufficient. I disagree.
[22] In the case of statutory appeals from administrative decision-makers, do we apply the legal standard to evaluate first-instance courts’ reasons in cases like R. v. Sheppard, 2002 SCC 26, [2002] 1 S.C.R. 869? Or must we consider some or all of the Supreme Court’s observations in Vavilov on the adequacy of administrative decision-makers’ reasons when they are assessed under reasonableness review? I note that there is some overlap between the two. Both require the reviewing court to read reasons functionally and contextually in light of the record as a whole, including the evidence adduced and the key submissions made.
[23] This last point is key and it is often overlooked by those seeking to overturn a decision. All decision-makers, particularly administrative decision-makers to whom the legislature has assigned a decision-making task for reasons of efficiency and expedition, aim to synthesize their reasons down to the essential factors that led them to decide the way they did. They are not to create an encyclopedic account of all of the evidence and all of the parties’ positions, as if their task is to report in detail everything that happened during the numerous days of the hearing. Instead, they are to distill and synthesize, ensuring that the parties, reviewing courts and the public observing the matter can discern where the administrative decision-maker was coming from and why it decided the way it did.
[24] In words equally apposite to the review of administrative decisions, this Court has stressed the "“realities about the craft of writing reasons”" and has described it as an "“imprecise art suffused by difficult judgment calls that cannot be easily second-guessed”": Mahjoub v. Canada (Citizenship and Immigration), 2017 FCA 157, [2018] 2 F.C.R. 344 at para. 69. Again, in words worthy of note in the context of administrative decision-making, this Court described the plight faced by judges with writing reasons in a technical hearing that has lasted for weeks on end:Immersed from day-to-day and week-to-week in a long and complex trial such as this, trial judges occupy a privileged and unique position. Armed with the tools of logic and reason, they study and observe all of the witnesses and the exhibits. Over time, factual assessments develop, evolve, and ultimately solidify into a factual narrative, full of complex interconnections, nuances and flavour.
When it comes time to draft reasons in a complex case, trial judges are not trying to draft an encyclopedia memorializing every last morsel of factual minutiae, nor can they. They distill and synthesize masses of information, separating the wheat from the chaff and, in the end, expressing only the most important factual findings and justifications for them.
Sometimes appellants attack as palpable and overriding error the non-mention or scanty mention of matters they consider to be important. In assessing this, care must be taken to distinguish true palpable and overriding error on the one hand, from the legitimate by-product of distillation and synthesis or innocent inadequacies of expression on the other. (Canada v. South Yukon Forest Corporation, 2012 FCA 165, 431 N.R. 286 at paras. 49-51.) These observations are particularly apt in a case like this with a voluminous, complex and sprawling record speaking to a diverse array of interests, where the governing standard is whether the placement of the railway lines is "“reasonable”", a somewhat subjective standard elusive of precise definition.
[25] Here, in my view, under any legal standard, the Agency’s detailed and comprehensive reasons—446 often heavily detailed paragraphs stretching over 100 pages, as well as an appendix—are adequate. In particular, the Agency found that the concerns of the appellants, particularly the appellant municipalities, had been or would be addressed through mitigation by the appellant municipalities themselves or were not specific to the location of the railway line. The Agency agreed with the prior joint hearing panel that the project’s direct effects were small and those effects were likely to occur regardless of whether CN’s project proceeds.
[26] One measure of adequacy is whether the parties were able to articulate to this Court why, in their view, the Agency’s evaluation of whether or not the location of the railway lines was "“reasonable”" should be sustained or quashed on appeal. On that measure, the Agency’s reasons pass muster. Both sides knew where the Agency was coming from on all issues and argued their cases without difficulty.
[27] Finally, and perhaps most importantly, in evaluating the adequacy of the Agency’s reasons, one must consider what exactly the Agency was deciding.
[28] Some cases decided by some administrative decision-makers, by virtue of the relative concreteness and objective nature of the factors to be considered, can be written up in a very precise, concrete, objective way. Here, one might think of an adjudicative decision-maker that merely has to find the exact facts, identify the correct law, and apply the law to the facts.
[29] But other cases involve the subjective task of balancing conflicting, often qualitatively imprecise factors against a vague standard, such as "“reasonableness”" or "“in the public interest”". The conclusion rests more upon the overall impression of the administrative decision-maker, sometimes an impression more subjective than objective or mathematical, one that beggars precise description.
[30] In this case, the Agency had to be satisfied that, in the language of subsection 98(2), "“the location of the railway line is reasonable, taking into consideration requirements for railway operations and services and the interests of the localities that will be affected by the line”". On the facts of this case, the "“interests of the localities”" included interests relating to municipal revenues, air quality and noise, land use planning, requirements for railway operations and services, and mitigation of effects. The evidence on each of these was massive and sometimes complex.
[31] The Agency’s task under subsection 98(2) is not one that can be conducted with scientific or mathematical precision. This is not a case where the various detrimental effects of the railway line and the requirements for "“railway operations and services”" can be assigned a precise value and can be weighed against each other with exactitude in order to determine whether the location of the railway line is "“reasonable”". Rather, the Agency is in the realm of well-informed impressions that are difficult to describe with exactitude.
[32] On some issues, all that can be expected in the reasons in a case like this is a description of the main concerns presented by the parties, an articulation of observations informed by the evidence, some comment on the key evidence adduced, some observations relevant to the balancing required under subsection 98(2), and a conclusion that leaves neither this Court nor the parties wondering why the Agency decided the way it did on the key, contested issues.
[33] Overall, the Agency’s reasons do just that. They are adequate.
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