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Administrative Law
A Look at the Supreme Court of Canada's Administrative Law Calendar
Sebastian Spano*
A number of important and interesting cases are currently before the Court dealing with a range of novel administrative law issues. The judgments that are expected from the Court over the coming months will address such issues as:
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whether a grievance adjudicator has the jurisdiction to rule that procedural fairness should have been accorded to an “at pleasure” appointee in the course of his dismissal;
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whether a contract between a government body and a mechanic who certifies automobiles on behalf of the government body can attract administrative law principles, particularly procedural fairness;
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the interpretation and effect of the code of ethics of the governing body for real estate professionals in Québec;
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whether the principles of interpretation adopted for the federal Access to Information Act should be applied to a judicial review in respect of the Personal Information Protection and Electronic Documents Act;
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whether conduct contravening a right protected in a human rights statute can meet the requirement for an independently actionable tort and whether human rights statutes should be incorporated in individual employment contracts; and
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whether a pragmatic and functional analysis is required where the Federal Courts Act prescribes a statutory standard of review.
Jurisdiction of a Grievance Adjudicator to Rule on Procedural Fairness
In David Dunsmuir v. Her Majesty the Queen in right of the Province of New Brunswick, File 31459, appeal from 2006 NBCA 27 (appeal heard 15 May 2007), the Appellant, a non-unionized Legal Officer employed with the Department of Justice, was terminated from his employment with 4.5 months pay in lieu of notice. Under the Public Service Labour Relations Act, R.S.N.B., 1973, c. P-25, non-unionized civil servants in New Brunswick may initiate a grievance to an adjudicator in respect of a discharge, suspension or other employment matter. The adjudicator assigned to hear the grievance ruled in a preliminary decision that he had jurisdiction to inquire into the reasons for the discharge and whether there was cause. The Province argued that as the Appellant was not discharged for cause, it was irrelevant whether there were sufficient grounds for discharge and, therefore, the adjudicator’s jurisdiction was limited to assessing the reasonableness of the notice period. In a second decision, the adjudicator ruled that, as an “at pleasure” appointee, the employee was owed a duty of procedural fairness, which was not provided. The dismissal was ruled void ab initio and the employee was ordered reinstated. On judicial review, the reviewing judge set aside the decision, holding the adjudicator’s preliminary decision to a standard of correctness. The adjudicator was held to have no jurisdiction to determine whether procedural fairness had been accorded. The adjudicator also erred in reinstating an “at pleasure” appointee. The Court of Appeal held that the appropriate standard of review was reasonableness, but the adjudicator’s decision failed to meet that standard.
When is a Contract between a Government Body and an Individual Subject to Procedural Fairness?
In Société de l'assurance automobile du Québec v. Yvan Cyr, et al., File 31657, appeal from 2660 QCCA 932 (Appeal heard 18 October 2007), the respondents, a mechanic and his employer, an auto service centre, were engaged under a contract with the Société de l'assurance automobile du Québec, a Crown corporation, to provide vehicle inspections and to issue certificates of mechanical fitness. The mechanic is also accredited by the Société. Following several notices to the mechanic that his inspections were deficient and not in accordance with the guidelines prepared by the Société, his accreditation to perform vehicle inspections and issue certificates was revoked. An application for judicial review was dismissed on the grounds that the relationship between the respondents and the Société was purely contractual and that its decision to revoke the respondent Cyr’s accreditation was not a decision in the administrative law sense, but the exercise of a contractual right. A majority of the Quebec Court of Appeal reversed the lower court’s decision, holding that the respondent Cyr was entitled to procedural fairness. The Société was also held to be subject to the Loi sur la justice administrative, which requires administrative agencies to comply with the principles of procedural fairness.
The Interpretation and Effect of a Professional Regulatory Body`s Code of Ethics
In Association des courtiers et agents immobiliers du Québec, et autre c. Proprio Direct Inc., File 31664, appeal from 2006 QCCA 978 (tentatively scheduled to be heard 30 January 2008), the respondent real estate broker was found by the discipline committee of the Association des courtiers et agents immobiliers du Québec, the professional governing body for the respondent broker, to have breached the legislation and regulations respecting brokers by contracting with vendors to pay a non-reimbursable fee, whether or not a sale of the property takes place. The decision of the committee was upheld on judicial review. The Quebec Court of Appeal reversed that decision finding, in the first instance, that the legislation did not prevent the respondent from entering into the fixed fee contracts. In addition, the contracts could not be said to be contrary to the public interest or bring the profession into disrepute on the basis of contravening the Association’s code of ethics. The standard of review on the first question (whether the contracts were permitted by the legislation and regulations was held to be correctness. On the second question (whether the conduct of the respondent was contrary to the Association’s code of ethics), the standard of review was reasonableness.
Should Access to Information Act Principles Apply on Judicial Reviews Under PIPEDA?
In Privacy Commissioner of Canada v. Blood Tribe Department of Health, File 31755, appeal from 2006 FCA 334 (tentatively scheduled to be heard 21 February 2008), an employee of the respondent was dismissed from her employment. Her employment file contained correspondence between the employer and its solicitors. Following the dismissal the employee requested access to the information in her employment file. The contents of the file were eventually disclosed to her except for the correspondence between the employer and its solicitors, the employer citing privilege. The Privacy Commissioner ordered production of the documents over which privilege was claimed pursuant to paragraphs 12(1)(a) and (c) of the Personal Information Protection and Electronic Documents Act (PIPEDA). The Federal Court of Appeal held the Commissioner’s decision to a standard of review of correctness. It concluded that the lower court had erred in adopting a purposive and liberal interpretation of paragraphs 12(1)(a) and (c) of PIPEDA and in adopting Access to Information Act principles in a PIPEDA review. The Court reversed the lower court’s decision and the Commissioner’s order for production of the documents was vacated.
Can a Breach of a Human Rights Statute found an Independently Actionable Wrong?
In Honda Canada Inc. operating as Honda of Canada Mfg. v. Kevin Keays and Ontario Human Rights Commission, File 31739, appeal from 2006 CanLII 33191 (ON C.A.) (tentatively scheduled to be heard 20 February 2008), a long-term employee was wrongfully dismissed from his employment following an absence from work due to medical reasons including chronic fatigue syndrome. He returned to work after his long-term disability benefits were terminated, although he continued to experience difficulties performing his work and missed work intermittently. The employment was terminated following a series of failed attempts to reach a work accommodation, the culminating event being the employee’s request for clarification of the purpose and methodology of an examination by a doctor proposed by the employer. In addition to damages for wrongful dismissal, including an extended notice period for bad faith in the manner of dismissal, the employee was awarded punitive damages as a result of discriminatory conduct contrary to the Ontario Human Rights Code. The damages were awarded on the basis that conduct contravening a right protected in the Human Rights Code meets the requirement for an independently actionable wrong. The trial judge’s decision was upheld on appeal, except the quantum of punitive damages, which the majority ruled was excessive. Should discrimination and harassment be treated as separate causes of action? Should human rights statutes be incorporated in individual employment contracts?
Is a Pragmatic and Functional Analysis Required Where Legislation Prescribes a Standard of Review?
The respondent in Minister of Citizenship and Immigration v. Sukhvir Singh Khosa, File 31952, appeal from 2007 FCA 24 (leave granted 25 October 2007) is a permanent resident who came to Canada in 1996 at the age of 14. He was accused of criminal negligence causing death as a result of engaging in an automobile street race. He was not incarcerated and received a conditional sentence of two years less a day that included house arrest, a ban on driving and community service. A removal order was issued against him under s. 36(1)(a) of the Immigration and Refugee Protection Act on the basis of serious criminality. The Immigration Appeal Division (IAD) of the Immigration Appeal Board refused to grant special relief from the removal order on the basis of humanitarian and compassionate grounds. The application for judicial review was denied. A majority of the Federal Court of Appeal allowed the appeal and ordered the Board`s decision set aside. What is the standard of review of the IAD`s decision? The majority held the appropriate standard of review to be reasonableness. Is a pragmatic and functional analysis required where the Federal Courts Act prescribes a statutory standard of review?
* Sebastian Spano, Parliamentary Information & Research Service – Law & Government Division, (613) 995-7918, SpanoS@parl.gc.ca.
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Alternative Dispute Resolution
He Said, She Said
Gary Furlong and Genevieve Chornenki
This article originally appeared in the OBA Alternative Dispute Resolution Section Newsletter, Volume 15, No. 1, December/Décembre 2006.
Mediation is finding its way into more areas of practice, especially in the sensitive areas of family law, custody, and children’s issues. With the recent implementation of mediation in child protection issues, it has once again raised the issue of power and power differentials in the mediation arena. Power is often the elephant on the table, the issue that no one, it seems, wants to deal with. We ask, once again, the impertinent question of, “What is the mediator’s responsibility when dealing with power imbalances?” Here are the two sides of the coin – or perhaps, two facets of a bigger crystal.
He Said
Gary Furlong*
 Once again, the seemingly unsolvable problem of power imbalances, and the mediators’ role to address them, is on the table. Like the legions of the undead, this issue continues to rise back to life, attacking the unsuspecting mediator in every dark alley of the mediation process it can find. Here, at last, is a remedy, a recipe for driving a wooden stake in the heart of the power debate, preventing it from rising to life ever again.
Power imbalances are here to stay. Every day and in every way, we work with parties who have power differentials across many dimensions. Power differentials exist not only in mediation, but in every other facet of the legal system, and just about any other human system in the world. And so, we must ask ourselves one simple question: So What?
Put simply, as mediators, power differentials are the air that we breathe, and we are no more required to get rid of them as we are to get rid of the oxygen in the room. They’re not good, they’re not bad, they just are what they are. We must learn to accept them, and move on.
This does not mean, however, that imbalances are irrelevant. They are very relevant, and we must find a context for understanding and working with power imbalances. But most assuredly not through that most prescribed home remedy for curing different perceptions of power - power balancing. This is the cure that is worse than the disease. We should remove this concept from our lexicon; put this idea to bed forever. It is the source of many mistakes mediators make.
Essentially, mediators have two primary tasks when it comes to power, neither of which relates to “balancing” that power in any way, shape or form.
First, it is the mediators’ job to host and run a “good process”. This means a process that is safe, transparent, ethical and fair enough to have all parties participate. This is not done by taking some parties’ power away or giving more power to others. It is done by running a clear and open process that helps the parties negotiate effectively.
So if one party tries to threaten or coerce another, the mediator doesn’t try to “balance” that power, the mediator names the behaviour, helps the parties understand each other, helps the parties explore their options given each other’s behaviour, and then helps the parties make an informed decision about what to do next.
Should either party be unable to make informed decisions for any reason (whether from the perceived “power” of the other party, a better BATNA away from the table, or a lack of competence to make these decisions at all), the mediator should simply terminate the process altogether. Not because of power problems, but because the process is no longer adding value to their negotiations.
In other words, the mediator must screen the parties and the process on an ongoing basis to make sure they’re playing by some very basic rules the mediator has set for the process. And as long as they’re following the rules (or changing the rules in a way that’s acceptable to all), they may bring and apply whatever power they have with them. Period.
The second obligation mediators have is to help the parties make informed decisions about the dispute they’re in. To do this, the mediator must accept the power imbalances the parties bring to the table and help them make a good decision in light of the power issues that present themselves. It is not the mediator’s role to change anyone’s power, to balance any power, nor attempt to shift it in any way. It is to help each party decide what is best for them, given the situation they’re in.
To look a bit deeper, consider answering the following questions:
- How often are parties honest with the mediator about how powerful they are (or how weak they are)?
- If you decide to balance power, how will the party that you are taking power from feel about your “impartiality”? How will the party the mediator is supporting or giving more power to feel about the mediator’s neutrality?
- How confident are you that you can accurately assess who has more power?
- How often does the perception of power change for each party through the course of a mediation?
- How often does the mediator tell all parties up front that if they have too much power, the mediator will be suppressing that as part of the process?
The questions themselves should paint a picture of just how incompatible the entire concept of power balancing is with the role of the mediator.
As mediators, we should leave all power balancing to where it rightfully belongs – to counsel who advocate on behalf of the client. It is not now, or ever, the mediators’ role to arbitrate or address power balances in the mediation process.
* Gary Furlong is a mediator, trainer, conflict resolution and Partnering specialist in Toronto. He is a principal with Agree Dispute Resolution, and can be reached at 1-800-524-6967, or at gary@agreeinc.com.
She Said
Genevieve Chornenki**
 “It’s all about balancing power.” That’s what I heard a colleague say over and over again the last time we taught mediation together, and every time I heard it I winced. Balancing power sounds simultaneously grandiose and naïve. Mostly troublingly, it appears to entail the imposition of the mediator’s personal value judgments on the unsuspecting participants. This one is deprived. That one is advantaged. This one is good. That one is bad. As a mediator, I wanted no part of that thinking, so I resisted the notion whenever it came up.
But two experiences recently eroded my resistance.
The first was personal. Last summer, a good friend loaned me a parenting book by Thomas Phelan. She’d grown tired of me complaining about my pre-adolescent son, I think. The book quickly pointed out the vast power disparity between children and parents and identified this as a persistent source of acting up.
Power imbalance in my house? Not since the Supreme Court of Canada deprived me of my wooden spoon. If anybody in the house had the power, it wasn’t me. What about all my efforts at inclusiveness, family conferences and collaborative discussion?
Yet, I knew that Phelan was on to something big. I did have power over my son. Lots of it and his nasty little behaviours were his way of recalibrating the scale. My problem was in confusing my intentions – to be a good modern day parent – with his reality as the lowest guy on the totem pole. I’d failed to see things from his point of view because that vantage point was no longer relevant to me.
My second experience was professional. In August, I had the pleasure of working with Justice June Maresca and Maggie Hall, MSW, on the curriculum for Child Protection Mediation Training. They were experienced experts in the field. My contribution was curriculum design.
Inevitably we came to a section called “Power Balancing” and inevitably I was irked, ready to pick a fight. But in that team, no question was too provocative and each challenge received a thoughtful and gracious response.
What Justice Maresca and Maggie Hall taught me was that power balancing is not a naïve sociological
concept, an economic imperative or an exercise in personal gratification for the mediator. Nor is it about judging the people involved.
In its most admirable form, power balancing is an acute awareness of the reality of every person at the table. Power balancing is about the mediator extending herself - not to order the world in her own image as most power balancers I’d encountered - but for the benefit of everyone else.
In Child Protection Mediation, the disparity between families and children’s aid societies can be extreme and some of the clientele simply cannot understand concepts and language that we take for granted. The mediator’s job is not to defeat the state and champion the oppressed. It is to encourage all participants to engage at a meaningful level, to take part in the discussions, to do the work that needs to be done to protect and sustain the child at risk. This begins from the moment the mediator assumes the file because she meets one-on-one with each participant and thus begins to hear first hand about their realities.
It’s a David and Goliath situation to be sure. But here’s the important thing. The mediator does not whisper, “David, come hither and I’ll help you defeat Goliath.” Instead she conveys, “You are a Goliath too, if only you would see yourself as that.” It’s a heart level communication and observing Justice Maresca in action it’s as if something intangible passes from her to another person.
This goes way beyond fair process. It’s not about turn-taking, or ground rules or interrupting a diatribe to protect the recipient. Nor is it about social engineering. Like a true apology, it’s about a profound interaction between two human beings – the mediator and the individual participant. The mediator helps each person see that he or she does count for something, is respected, can do what needs to be done.
I don’t ever intend to practise Child Protection Mediation but the application of this is obvious for every context I’ve seen - the grievor with a thousand grievances; the millionaire business man whose professional advisors let him down; the family real estate feud; the patient whose doctor offended him; the not-for-profit whose construction project went badly awry. Difficult mediations are always interpersonal at some level and that’s where these notions add value and have practical significance.
In all really difficult mediations I’ve undertaken –those where I succeeded and those where I failed – I concede that power was at play despite my insistence that it was irrelevant. In every instance, my ability to motivate people at the table varied directly with my ability to inhabit their realities and convey understanding without judgment. The more I was able to do so, the more of a difference I could make. And when the connection just wasn’t there we couldn’t grasp the golden ring.
Power balancing is a regrettable misnomer. It’s time to strip away that arrogant label and lay bare what can really happen in a mediation on a straight human level, for there lies the greatest potential of this process.
** Genevieve Chornenki was inaugural Chair of the ADR Section of the OBA. She has practiced ADR since 1989, and can be reached at (416) 975-9898, or at gac@chornenki.com.
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Business Law
The Canadian Climate Exchanges: The Future of Canadian Emissions Trading
Barbara Hendrickson and Wendy Chun*
 This article originally appeared in Business Beat, the OBA Business Law Section Newsletter, Volume 17, No. 3, May/Mai 2007.
Currently at least three Canadian exchanges have declared their intentions to enter into the Canadian carbon market: the Toronto Stock Exchange (“TSX”), the Montreal Exchange (“MX”) and the Winnipeg Stock Exchange (“WSE”). All three of the exchanges are waiting on the Canadian government to finalize the proposed federal Clean Air Act (“Bill C-30”)1 and to clarify its intentions with respect to meeting its commitments under the Kyoto Protocol including meeting emission targets. The following is a brief description of the proposals put forward by these three Canadian exchanges for the development of Canadian carbon markets.
The Montréal Exchange
After signing of a Letter of Intent in December 2005, MX and Chicago Climate  Exchange (“CCX”) entered into a joint venture to create the Montreal Climate Exchange (“MCeX”), a Canadian environmental products market on July 12, 2006. The MCeX’s stated mission is to offer price transparency, environmental integrity, low cost, wide access and reliability to the many sectors of the Canadian economy involved in air quality and climate change concerns. The MCeX intends to provide cost-effective trading products for the Canadian carbon market through trading in carbon dioxide emissions contracts, and plans to develop trading, clearing, as well as registry services for Canadian environmental products. The MCeX will be geared towards trading by companies which are end users, but retail investors and hedge funds are also expected to trade. The MX advocates for a market-based risk management approach where price is managed in futures and options. The MCeX hopes to build on the CCX experience in North America and in the European Union (“EU”). The MX recently announced that it will go ahead with the launch of its trading platform for GHG credits and derivatives of GHG credits.
The TSX Group
The TSX first announced its intention to launch a global exchange for pollution emissions credits in June of 2005. The TSX’s plan is to initially operate a cash market for the trading of emissions credits and in the future to develop a futures and options market for emissions. On February 27, 2007 the TSX released their submission to the federal Canadian government legislative committee on Bill C-30, which urged the federal government to act quickly in establishing a carbon-emission contract registry and a framework of basic policies (including national compliance requirements) to support “efficient and complementary emissions trading services”. The TSX’s view is that it is in a good position to create trading solutions for the reduction of GHG emissions because many of the TSX’s existing clients are Canadian LFEs. The TSX has advocated for competition in the carbon markets in Canada. Its position is that competition will ultimately benefit the market because it will reward the most innovative solutions and the most efficient facilities, leading to more cost effective solutions for participants.
The Winnipeg Commodity Exchange
The WCE has also been studying emissions trading for some time, and has set up the Canadian Climate Exchange (“CCE”) to pursue the domestic market. The CCE was established in February 2003, but since the Canadian Government has not yet enacted clear market rules, its development has been stalled. CCE Inc. was created by WCE Holdings Inc., the parent company of the WCE, in order to trade emissions credits and to provide market-based solutions for the reduction of GHG emissions in Canada.
Models for Operation
While the details of the future operations of these Canadian carbon exchanges are not clear, two of the possible models are the voluntary model such as the one that the CCX operates in the U.S. or the EU model with mandatory targets.
The CCX operates a GHG registry and trading system in the U.S. The CCX system supports both exchange-cleared trades, which preserve anonymity, and the exchange of electronic bilateral trades, which are established through private negotiations off-system. The CCX has an offset program, including agricultural offsets based in Canada. Under the CCX model, participants enter into agreements to set targets for reducing their GHG emissions by a specific amount within a certain period. If the companies meet and exceed those targets, they generate emission credits which they can either keep for themselves for future use, or sell to the highest bidder on the CCX. If the company is unable to meet its initial target, it will then have to buy the credits on the CCX or face possible penalties.
The EU model is based on the EU Emissions Trading System (“EU ETS”). The EU ETS is based on a directive2 adopted in October 2003 by the EU Parliament for a pan-European emissions trading system establishing a scheme for GHG emission ‘cap-and-trade’ system within the EU Member States. EU ETS targets are mandatory and excesses over allowances will result in fines. The EU ETS was developed in response to the requirements of the Kyoto Protocol, which came into force in 2005 imposing GHG emission limits for the period commencing in 2008 through 2012, the first Kyoto Protocol commitment period. The system currently has approximately 12,000-15,000 participants, making it the largest such system in the world.
Conclusions
The development of carbon exchanges in Canada has been hampered by an uncertain regulatory climate in the GHG area. There is still a great deal of uncertainty regarding the most recent Canadian federal proposals, which provide for a broad based consultation process and a prolonged timeline for implementation of GHG targets. It is not clear whether domestic emissions trading will interface with the EU markets and the trend is for the federal government to align Canadian regulations in the area of GHG emissions and other air pollutants with U.S. regulations and standards. In addition, several of the provinces have announced that they are speaking with U.S. states to build a North American emissions trading system. It is therefore unclear what the Canadian federal government’s intentions are in terms of linking up with the international markets. These issues – timing, targets and interface with international systems – raise considerable uncertainty with respect to the future of emissions trading in Canada.
* Barbara Hendrickson, Partner, McMillan Binch Mendelsohn LLP, (416) 865-7903, barbara.hendrickson@mcmbm.com.
Wendy Chun, Student-at-Law, McMillan Binch Mendelsohn LLP, (416) 865-7000, wendy.chun@mcmbm.com.
1 An Act to amend the Canadian Environmental Protection Act, 1999, the Energy Efficiency Act and the Motor Vehicle Fuel Consumption Standards Act (“Clean Air Act”).
2 Directive 2003/87/EC of the European Parliament and of the Council of 13 October 2003 establishing a scheme for greenhouse gas emission allowance trading within the Community and amending Council Directive 96/61/EC.
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Canadian Corporate Counsel
Through Your Client’s Eyes
Patrick J. McKenna*
This article originally appeared in the Canadian Corporate Counsel Association (CCCA) magazine, Fall 2007 Automne, Volume 1, No. 2.
Improve relevance and satisfaction by talking to your internal corporate clients.
According to Inside Counsel magazine’s 18th Annual Survey of General Counsel, 70.5% of in-house counsel scored their outside firms a mere B for overall performance. Another 10.5% rated their firms C or worse. And those percentages have eroded each year for the past three years. However, when asked for their views, 62% of law firms gave themselves a solid A for performance! Anybody see a disconnect here?
This incongruity reappears when we ask corporate executives to grade the performance of their internal legal departments. The individual lawyers in the department grade themselves highly on their ability to understand the organization and deliver true value. But the executive team’s perceptions are often captured in comments like these:
“Corporate Legal doesn’t seem to really understand the business or our business relationships. Currently, some of our key suppliers cringe whenever they have to deal with us on a contractual matter.”
“Our Legal Department needs to do more trend line analysis on repetitive issues that they are observing, and then initiate the discussion on how these issues could be prevented or better addressed.”
“It would be great to have our Legal Department come out and do a presentation for
us on how the work flows and how they could be most effective. No one from Legal has ever visited with us.”
It seems we hold entirely different views based on whether we are the procurer or the provider of professional services.
Once every year, you have to get out into the various departments and divisions within your organization and talk to the key executives—your clients—oneon- one about what their current needs are, how they view your legal department and what recommendations they may have to offer you.
My experience has been that asking the key business heads what they think the legal department should be doing, and comparing their feedback to what the lawyers in your department think these executives will say, usually produces the necessary impetus for focused change.
Some of the questions that I’ve used in these kinds of interviews include:
- Are there any aspects of your business, strategic objectives or competitive challenges
that you wish we (the legal department) understood better?
- What would you suggest (if anything) our lawyers could do to become a more integral part of your internal business team?
- Are there specific things we could be doing to reduce the time you have to spend managing your responsibilities? (or: What could we do that would make your life easier?)
- Is there any policy, procedure or process that you feel we’re trying to impose on you, and you don’t understand why?
- How would you describe what our legal department does best? What is the most valuable service we perform for your area of responsibility?
- How could we improve the level of responsiveness, proactive counsel or general service to you? (Or: tell us what the legal department could do to be more useful to you.)
- As you think about the range of services that our lawyers provide, what could an innovative legal department be doing that executives like you may not yet have asked for?
Asking questions like these might seem threatening, but the answers can be extremely revealing. Here are some of the insights that departments report from the exercise:
- Don’t assume that all the important projects and issues in the organization are hitting your desk, or that the value of your work speaks for itself.
- Focus your greatest efforts on unearthing and understanding your organization’s top priorities, helping solve them, and reporting regularly to senior management on what you’ve achieved.
- Include performance metrics to illustrate where your work comes from, where your time goes, and where you spend the organization’s resources. (See my last column, “The Metric System,”March 2007, p. 62)
- Structure your reports around the organization’s top priorities, rather than legal issues.
Some legal departments have seized the opportunity to see through their clients’ eyes by asking themselves hard questions before others do. What you learn can help you position your legal team to become an integral part of the business that really can demonstrate its strategic value to the organization. Here’s to getting straight A’s!
* Patrick J. McKenna (www.patrickmckenna.com) is a principal in Edge International (www.edge.ai) and since 1983 has worked exclusively serving the legal profession in matters of strategy and practice management.
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Charity and Not-for-Profit Law
Charitable Gaming
Kate Lazier*
This article originally appeared in Charitable Thoughts, the OBA Charity and Not-for-Profit Law Section Newsletter, Volume 11, No. 1, September/Septembre 2007.
In Canada, an independent gambling operation may be considered an offence under the Criminal Code. However, charities may fundraise using games and lotteries provided that they obtain a licence and follow the rules set out in the licence.
The Criminal Code casts a wide net around gambling. Where property is disposed of by an element of chance and consideration is paid for a chance to win, it may be an offence for the operator of the game, players and everyone else involved. Under the Criminal Code it is illegal to keep a place (even temporarily) where a fee is charged to the players to participate in a game or use gaming equipment. It is also an offence for a person to be found without a lawful excuse in such a place or knowingly to permit one's place to be used for the purpose of gambling. Managing, advertising selling tickets for or, buying tickets for a lottery or game of chance is also an offence. Further, it is an offence to dispose of goods by way of game of chance or mixed chance and skill in which the contestant pays money or other valuable consideration.
Charities can carry on a gaming "fun night" without a license. In such events players are given chips free of charge to gamble for the purpose of entertainment and no prizes are awarded. These events raise money by charging for some other aspect of the event such as a dinner. Charities undertaking fun nights should carefully structure the event to ensure that it does not contravene the Criminal Code.
A charity can charge a fee to participants to play a game if the charity obtains a gaming licence from a provincial regulator to carry on charitable gaming events. According to the Canadian Partnership for Responsible Gambling, in 2005 over 30,000 charitable gaming licenses were issued across Canada, and charities received over $600 million in net gaming revenue. However, it is important to note that given the nature of gambling, not all gaming fundraisers are profitable.
Provinces licence such games as bingo, raffles, sports pools, break open tickets and casino nights. Some provinces license card games including blackjack and poker. The recent popularity of poker has led several provinces to license poker events in order to bring the existing games into the legal system, assist charities to raise funds, and ensure the integrity of game play.
While the rules for obtaining a license differ among the provinces, the Criminal Code requires that the charity itself must conduct and manage the game or lottery and that all of the proceeds from the lottery must be used for charitable or religious purposes. This means that if a donor hosts an event and provides all of the funds to a charity, the donor may still be committing a Criminal Code offence. This unfortunate rule could land an entrepreneurial philanthropist in trouble.
Charitable gaming also raises charitable tax receipting issues. Lottery tickets usually lack the element necessary to be considered a gift according to the CRA and therefore they are not eligible for a charitable receipt. However, poker tournaments are eligible for a receipt under the split-receipting rules according to the CRA. A receipt can be given for the amount paid to play minus: the value of dinner, the total prize amount divided by the numbers of participants, and the fee for a similar non-charitable tournament.
The law of charitable gaming is complex raising the possibility of criminal charges as well as charitable receipting issues.
* Kate Lazier, Miller Thomson LLP, (416) 595-8197, klazier@millerthomson.com.
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Citizenship and Immigration Is it Work? Or isn't it?
Sergio R. Karas*
The Immigration and Refugee Protection Act (“IRPA”),1 and its Regulations have been in effect since June 28, 2002, and provide more flexibility to hire foreign workers than previous immigration legislation. However, employers should plan carefully when considering international relocations, to avoid the pitfalls that plague the system, including misunderstanding as to who can work in Canada and for how long, delays at visa processing posts overseas and compliance with Service Canada requirements for obtaining Labour Market Opinions (“LMOs”).
Definition of “Work”
A foreign worker may be authorized to work in Canada without a permit or may be required to obtain one. The first step in determining whether a Work Permit is needed, is to consider the nature of the activities to be performed by the foreign worker. “Work” is defined in Section 2 of the IRPA Regulations as an activity for which wages or commission are earned, or which competes directly with Canadian citizens or permanent residents in the labour market.
If a foreign worker performs an activity that will result in receiving remuneration, he or she will be engaging in “work”. This includes salary or wages, commissions, receipts for fulfilling a service contract, or any other situation where foreign nationals receive payment for the performance of services. Even if the foreign worker does not receive remuneration, the activities performed may still constitute “work” if there appears to be an element of competition with the local labour force. To determine which activities could be considered “work”, ask yourself the following questions:
- Will the foreign worker be doing something that a Canadian or permanent resident should really have the opportunity to do?
- Will the foreign worker be engaging in a business activity that is competitive in the marketplace?
The answers to these questions are not always obvious. Some examples of “work”, may include, but are not limited to:
- Technical personnel coming to Canada to repair machinery or equipment, even if they are paid outside of Canada by a third party contractor.
- A foreigner who intends to engage in self-employment, either directly or by receiving commissions or payment for services.
On the other hand, the following activities are not considered to be “work”:
- Volunteer work for which a person would not normally be paid, such as activities for charitable or religious institutions.
- Helping a friend or family member with housework or childcare in the home.
- Attending meetings on behalf of a foreign employer to discuss products or services, take orders or specifications for a manufacturer abroad.
In a recent case, the Federal Court had to decide what is the scope of the term “work” as defined in the IRPA Regulations. In Juneja v. Canada,2 the court was faced with an interesting fact situation: Mr. Juneja entered Canada with a Study Permit, which prohibited his employment unless authorized by Citizenship and Immigration Canada, a standard requirement. During the course of an investigation, Mr. Juneja was observed to be working at a local automobile dealership in Edmonton. He was arrested for working without authorization, contrary to Section 30(1) of the IRPA.3 An admissibility hearing was then convoked where Mr. Juneja was declared to be inadmissible to Canada and issued an Exclusion Order requiring him to leave the country. Mr. Juneja did not dispute the fact that he was not in possession of a Work Permit; however, he contended that his activity did not constitute “work” as defined in the IRPA Regulations. Mr. Juneja argued that he was not being paid, and that he was only keeping track of his time in case he received the authorization to work in Canada. Although there was some dispute about the factual context, it was clear from the evidence that the employer had agreed to pay him $8 an hour retroactively for the time he had spent performing his services at the dealership, should he receive his Work Permit.
At the admissibility hearing, it was determined that this “contingent” arrangement entered upon between Mr. Juneja and the dealership owner was an agreement to bank Mr. Juneja’s hours and to pay him a wage, albeit conditionally, and, therefore it was either an activity for which wages are paid or reasonably expected, or which is otherwise in direct competition with the employment activities of Canadians or permanent residents. Therefore, the tribunal concluded that, despite the fact that Mr. Juneja was not being paid immediately, his activities constituted “work” as defined in the IRPA Regulations.
Upon judicial review, the Federal Court entertained the question of whether a contingent arrangement to pay a wage for work performed meets the legal definition of “work” as set out in the IRPA Regulations. The question was answered in the affirmative. The Court held that Mr. Juneja had an expectation of future payment and the dealership had at least a conditional, and perhaps an absolute, legal obligation to pay for the work that he performed. This activity was of a character for which wages are paid or anticipated.
The Court further held that, even if Mr. Juneja was correct in arguing that the definition of “work” sets an absolute standard which is not fulfilled by a conditional arrangement for payment, his conduct was still caught by the second part of the definition, that is, the performance of an activity in direct competition with the activities of Canadians and permanent residents in the Canadian labour market: his employment directly competed with others who were legally entitled to work in Canada, and this was so whether a wage was paid or not. The Court rejected the contention that the second part of the definition of “work” only applied to self-employed persons, and held that the definition contains no such qualification.
Further, the Court also referred to the Regulatory Impact Analysis Statement (RIAS), published with the regulations in the Citizenship and Immigration department guidelines, indicating that the definition of “work” includes unpaid employment undertaken for the purposes of obtaining work experience, such as an internship or practicum normally done by a student. This could have serious implications for many small businesses which are not normally familiar with Work Permit requirements and are rather lax when hiring help.
Last, the Court referred to pre-2002 litigation on the matter and noted that the definition of “work” had been changed, and that the previous provision spoke of “an activity for which a person received or might reasonably be expected to receive valuable consideration”. That provision made no reference to competing for work that should otherwise be available to Canadians. The Federal Court had already found in the previous case of Georges v. Canada,4 that the essential concern of that definition was to protect employment opportunities for Canadians whether wages were paid or not. The Court reasoned that neither Georges5 nor the later case of Bernardez v. Canada6 on the same subject could support a finding that Mr. Juneja was not working whether under the prior or current definition of “work”.
In light of this recent Federal Court decision, it is important that individuals not be engaged to perform any services, either paid or where a reasonable expectation of earnings exists, without first obtaining a Work Permit for a specific employer and activity, in accordance with the IRPA Regulations.
* Sergio R. Karas is a Certified Specialist in Canadian Citizenship and Immigration Law by the Law Society of Upper Canada. He is current Chair of the Ontario Bar Association Citizenship and Immigration Section, Co-Chair of the International Bar Association Immigration and Nationality Committee and Vice-Chair of the American Bar Association Canada Committee, Section of International Law. His comments and opinions are personal and do not necessarily reflect the position of any organization. He can be reached at (416) 506-1800 or karas@karas.ca.
1 S.C. 2001, c. 27
2 2007 FC 301
3 30(1) Work and study in Canada - a foreign national may not work or study in Canada unless authorized to do so under the Act.
4 [1978] F.C.J. No. 140, [1979] 1 F.C. 349 (ca)
5 Supra
6 (1995), 101 F.T.R. 203, [1995] F.C.J. No. 1927
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Civil Litigation
The Latest on Disclosure regarding the Sale of Securities
Jeffrey Radnoff*
 The Supreme Court of Canada’s recent decision in Kerr v. Danier Leather Inc. [2007] CarswellOnt 6445 (S.C.C.) is significant for the following reasons:
- 1. it clarifies, to some extent, the disclosure of obligations of an issuer who sells shares under the Ontario Security Act, R.S.O. 1990, c.S.5;
- 2. assists in clarifying a recently enacted legislative right of action for cause of action for misrepresentations by an issuer in a prospectus;” and,
- 3. states that the disclosure obligations of an issuer are governed by the relevant provincial security statues/rules, and not by the common law business judgment rule.
Danier is a well known company that sells leather goods. In the spring of 1998 it made its first public offering. The prospectus contained a year-end sales forecast as of May 6, 1998. In or around May 16, 1998, Danier management ascertained that due to warmer than expected spring weather, the forecast may not be achieved. The initial public offering closed on May 20, 1998. Danier did not amend its forecast between May 16, 1998 and May 20, 1998, however, it did substantially achieve the forecast and sales.
The trial judge found that although the management honestly believed that the year-end forecast would be met, its belief became objectively unreasonable in a narrow window of time during the course of the distribution when it became aware of the shortfall in expected sales. At trial, the investors were successful and the trial judge found that the shareholders who sold their shares after June 10, 1998, were entitled to the difference between the IPO price ($11.25) and the price of closing on June 10 ($8.90), for a total loss of $2.35 per share.
The Court of Appeal reversed the trial judgment on four separate basis:
- the prospectus on its filing date (May 6, 1998) provided full, true, and plain disclosure of all material facts and, thereafter, investors were only entitled to notice of material changes, and no material changes arose during the period of distribution;
- the court of appeal disagreed with the trial judge’s findings that the forecast contained an implied representation of objective reasonableness;
- there was nothing in the language of the prospectus to suggest that Danier’s subjective belief in the forecast was reasonable or was being put forward by reasonable business people or otherwise being put forward as objectively reasonable; and,
- the forecast was objectively reasonable as of May 20, 1998, the closing date. The fact that the forecast was substantially achieved, in the court’s view, was at least some evidence of its objective reasonableness as of May 20, 1998.
Further, the Court of Appeal stated that the trial judge erred by failing to give any deference to the business judgment of senior management. Applying the business judgment rule, the Court of Appeal found that the trial judge wrongfully substituted his own view as to whether the forecast was objectively reasonable as of May 20, 1998 for management’s view, and also that the trial judge overlooked important pieces of evidence that tended to support management’s view.
The Supreme Court of Canada dismissed the appeal from the Court of Appeal. The decision of the Supreme Court of Canada is significant because Justice Binnie, speaking for the Court, states that the business judgment rule does not apply to the sales of securities regulated by the Ontario Securities Commission. This is an important point of clarification.
In particular, in respect of business judgment rule, the Supreme Court of Canada held as follows:
On the broader legal proposition, however, I agree with the appellants that while forecasting is a matter of business judgment, disclosure is a matter of legal obligation. The Business Judgment Rule is a concept well-developed in the context of business decisions but should not be used to qualify or undermine the duty of disclosure. The Business Judgment Rule was sell stated by Weiler J.A. in Pente Investment Management Ltd. v. Schneider Corp. (1998), 42 O.R. (3d) 177 (Ont. C.A.):
The court looks to see that the directors made a reasonable decision not a perfect decision. Provided the decision taken is within a range of reasonableness, the court ought not to substitute its opinion for that of the board even though subsequent events may have cast doubt on the board’s determination. As long as the directors have selected one of several reasonable alternatives, defence is accorded to the board’s decision.
[Emphasis in original deleted; p. 192.]
The traditional justifications for the rule against its application here. It is said, truly enough, that judges are less expert than managers in making business. Moreover, business decisions often involve choosing from amongst a range of alternatives. In order to maximize returns for shareholders, managers should be free to take reasonable risks without having to worry that their business choices will later be second-guessed by judges. These justifications—based on relative expertise, and on the need to support reasonable risk-taking—do not apply to disclosure decisions. …
* Jeffrey Radnoff, Radnoff Law Offices, (416) 203-3641, Jradnoff@radnofflaw.com.
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Constitutional, Civil Liberties and Human Rights
More than 100 Toronto High School Students Attend Law Day Event at OBA
This article originally appeared in the OBA Constitutional, Civil Liberties and Human Rights Section Newsletter, Volume 10, No. 3, June/Juin 2007.
The Ontario Bar Association Toronto office played host to some lively visitors on Tuesday, April 17, when about 125 Grade 10 and 11 students from five high schools from across the city attended a Law Day event at the OBA Conference Centre. The event called “The Charter and You” was sponsored jointly by the OBA’s Constitutional, Civil Liberties and Human Rights Section and the legal clinic Justice for Children and Youth, with participation by the Education Law Section. It was one of a series of province-wide events which were part of a collaborative project of the OBA, the Ontario Justice Education Network, the Law Society of Upper Canada and the Association of French Speaking Jurists of Ontario to commemorate the signing of the Charter of Rights and Freedoms.
The morning began with an overview of the significance of the day by Lucy McSweeney of the Constitutional, Civil Liberties and Human Rights Section; proceeded with team crosswords and games based on “Jeopardy” and “Cranium” designed to test the students’ knowledge of the Charter; student debates on the proposition that young people should have the same rights of freedom of expression as adults; and concluded with an information session on being a lawyer.
Law Day featured three guest speakers who were particularly well received. Dr. Justice Blainey-Broker spoke at the lunch plenary session about her experience challenging her exclusion from the boys’ hockey league [Re Blainey and Ontario Hockey Association et al (1986) 54 O.R. (2d) 513]. She inspired the young people to think about what they would do to fight for their own rights or the rights of others, giving the moving example of how her brother gave up his spot on the team because he thought that she had been unfairly denied a place. Robbie Barnett-Kemper spoke at one of the afternoon breakout sessions about his mothers’ participation in the successful challenge to the constitutionality of Ontario’s adoption laws which prevented same sex couples from adopting [M.D.R. v. Ontario (Deputy Registrar General) 270 D.L.R. (4th) 90]. Gurbaj Multani participated in another afternoon session through videoconferencing from Montreal. Mr. Multani is the now 17 year old Sikh student whose school board prohibited him from wearing a kirpan to school, a decision which the Supreme Court of Canada held was not a justifiable restriction of his Charter right to freedom of religion (Multani v. Commission scolaire Marguerite-Bourgeoys [2006] 1 S.C.R. 256).
This was the first Law Day event organized by the Constitutional, Civil Liberties and Human Rights Section. Judging from comments received from teachers and students, it achieved its aim to be fun for the students while promoting learning about and engagement with the Charter. Thanks to all of the volunteers from both Sections and Justice for Children and Youth for helping to make the event such a success.
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Construction Law
Ontario Court of Appeal Rules Assembly Line Not Lienable
Paul Ivanoff and Roger Gillott*
 On September 27, 2007, the Ontario Court of Appeal held that the installation or repair of an assembly line that was portable and capable of removal from a building did not give rise to lien rights under the Construction Lien Act.
In Kennedy Electric Limited v. Dana Canada Corporation, two subcontractors registered liens against an automobile parts manufacturing facility in which they had installed an assembly line. The assembly line was pre-built by the general contractor at its premises and was tested and inspected. The subcontractors were then retained to take the line apart, transport it to the facility and install it.
The assembly line consisted of 100 platforms and 165 robots  and, when installed, as attached to the floor by several thousand chemical and mechanical bolts. The line covered 100,000 square feet of the building, was twenty feet high and weighed approximately 500,000 tons. Transportation of the line required 165 transport trucks.
Court rules assembly line not an “improvement” under CLA
A dispute arose and two subcontractors, Kennedy Electric and Cassidy, registered liens against the facility. At trial, the court concluded that the assembly line could not be considered an “improvement” to the land, as required by the Construction Lien Act (CLA) to give rise to lien rights. In assessing lienability, the court considered the issue of portability and the degree to which the equipment was integrated into the building.
The Court of Appeal unanimously held that the subcontractors did not have lien rights under Ontario’s Construction Lien Act. The court relied on the trial judge’s finding that the assembly line was portable and found that the trial judge had made no “palpable and overriding error.” Speaking for the court, Justice Armstrong went on to say, “[w]hile a different judge may have come to another conclusion on the issue of portability, I am satisfied that it was open to the trial judge to reach the conclusion that he did.”
Lienability a factual determination
The court reviewed a number of other cases on the issue and concluded that, “[w]hether [the cases] fall within the definition of improvement is essentially a fact-finding exercise. While a trial judge must apply the statutory definition of ‘improvement’ to the evidence and he or she is therefore engaged in deciding a question of mixed fact and law, the factual determination is by far the more significant element in the exercise.”
Justice Armstrong summarized the court’s view, saying, “In most cases, the installation or repair of machinery used in a business operated in a building, particularly where the machinery is portable, will not give rise to lien rights under the CLA. On the other hand, where machinery is installed in a building for the use of a business and is completely and permanently integrated into the building, a lien claim will arise.”
Significance
This decision will be of interest to both purchasers and suppliers of machinery and equipment in manufacturing and other facilities.
Kennedy Electric Limited v. Dana Canada Corporation http://www.ontariocourts.on.ca/decisions/2007/september/2007ONCA0664.htm
* Paul Ivanoff, Osler, Hoskin & Harcourt LLP, (416) 862-4223, pivanoff@osler.com.
Roger Gillott, Osler, Hoskin & Harcourt LLP, (416) 862-6818, rgillott@osler.com.
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Criminal Justice
Declaration of Innocence
James Morton*
 Recently, counsel for the wrongfully convicted have sought declarations of factual innocence. While from time to time (witness the recent tainted blood case) judges have gone so far as to state, in their reasons, that an accused is exonerated from any blame (and not merely not proven to be guilty to the criminal standard of proof), declarations of innocence are unknown to Canadian law.
The recent decision (released on the Court of Appeal website) in R. v. Mullins-Johnson, 2007 ONCA 720 makes the refusal to make such a declaration very clear. The relevant passages of the decision follow:
[23] There are not in Canadian law two kinds of acquittals: those based on the Crown having failed to prove its case beyond a reasonable doubt and those where the accused has been shown to be factually innocent. We adopt the comments of the former Chief Justice of Canada in The Lamer Commission of Inquiry Pertaining to the Cases of: Ronald Dalton, Gregory Parsons, Randy Druken, Annex 3, pp. 342:
[A] criminal trial does not address “factual innocence”. The criminal trial is to determine whether the Crown has proven its case beyond a reasonable doubt. If so, the accused is guilty. If not, the accused is found not guilty. There is no finding of factual innocence since it would not fall within the ambit or purpose of criminal law.
[24] Just as the criminal trial is not a vehicle for declarations of factual innocence, so an appeal court, which obtains its jurisdiction from statute, has no jurisdiction to make a formal legal declaration of factual innocence. The fact that we are hearing this case as a Reference under s. 696.3(3)(a)(ii) of the Criminal Code does not expand that jurisdiction. The terms of the Reference to this court are clear: we are hearing this case “as if it were an appeal”. While we are entitled to express our reasons for the result in clear and strong terms, as we have done, we cannot make a formal legal declaration of the appellant’s factual innocence.
[25] In addition to the jurisdictional issue, there are important policy reasons for not , in effect, recognizing a third verdict, other than “guilty” or “not guilty”, of “factually innocent”. The most compelling, and, in our view, conclusive reason is the impact it would have on other persons found not guilty by criminal courts. As Professor Kent Roach observed in a report he prepared for the Commission of Inquiry into Certain Aspects of the Trial and Conviction of James Driskell, “there is a genuine concern that determinations and declarations of wrongful convictions could degrade the meaning of the not guilty verdict” (p. 39). To recognize a third verdict in the criminal trial process would, in effect, create two classes of people: those found to be factually innocent and those who benefited from the presumption of innocence and the high standard of proof beyond a reasonable doubt.
* James Morton, Steinberg Morton Hope & Israel, (416) 225-2777, ext. 230, jmorton@smhilaw.com.
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Education Law
Toronto District School Board’s School Community Safety Advisory Panel and Its Impact
Nicola Simmons*
This article originally appeared in the OBA Education Law Section Newsletter, Volume 17, No. 1, October/Octobre 2007.
On May 23, 2007, a fifteen year old student was fatally shot in the hallway of a public high school in Toronto. This incident has had a significant impact on the Toronto District School Board, the broader Toronto community, the Province, and on the highest court of the Province, which recently made comments in obiter in the decision R. v. L.B., [2007] O.J. No. 3290 (Ont. C.A.).
Following this horrific incident and the accompanying public and media outcry, the Toronto District School Board created a School Community Safety Advisory Panel on June 5, 2007, chaired by Toronto lawyer Julian Falconer. The Panel’s mandate is to make findings and recommendations to the Director of the Board with respect to school supervision, student discipline and security at the School.1 The panel is required to consult with students, parents and employees of the School, and is empowered to make other enquiries and consultations, including with community agencies, advocacy groups, trustees, administration, unions and employee groups.
Early in its consultation process, the Panel learned of a serious incident alleged to have occurred at the School in October, 2006. As a result, the Panel’s Terms of Reference were expanded to include a review of the particular safety risks to female visible minority students in the Board’s schools.2
On August 28, 2007, following two months of consultations with students, staff, and other stakeholders, the Panel released An Interim Report on School Safety, detailing the perspectives of students at the School and providing four non-systemic, narrow recommendations. Firstly, the Panel recommended that a building safety audit of the School be conducted. Secondly, the Panel recommended that additional human resources be provided to the geographical quadrant in which the School is located. Thirdly, the Panel recommended that the superintendent responsible for the family of schools that includes the School and the trustee for the area engage in mediation. Finally, the Panel recommended that its work be extended to the other schools in the geographical quadrant and that the timeline for the Final Report be extended to November 15, 2007.3
The Interim Report was based largely on confidential in-person interviews of 41 students, and an anonymous and confidential questionnaire in which 423 of the 838 students at the School participated.4 The Panel found that students felt that their School had been unfairly negatively portrayed in the media. There were, however, several recurrent issues with respect to safety. The first issue concerned the negative impact of “hallway students” on the School. Hallway students are students who congregate in the hallway when they are either skipping class, let out of class to go to the washroom, let out of class early, are trespassing, or have been removed from their class as a form of discipline. The problems associated with hallway students were compounded by ineffective hallway monitors.5
Another issue the students identified was difficulty in the student-teacher relationship, including students talking back to teachers, and students threatening or assaulting teachers. In addition, teachers felt that the administration was unresponsive to their concerns and unwilling to impose consequences on students who misbehaved. Possible reasons for this unwillingness to impose discipline were attributed to the pressure from the Board to decrease suspension and expulsion rates, and following the settlement between the Board and the Ontario Human Rights Commission,6 a growing feeling among administrators that suspensions and expulsions, as consequences for poor classroom behaviour, should not be utilized. There is a perception that, as an alternative, administrators have increased the number of “safe schools transfers”.7 The effects of the settlement will be canvassed in more detail in the Final Report.8
Safe schools transfers were also raised as an issue of concern. Safe schools transfers are administrative and are arranged by the Board centrally. They are utilized in situations where students are prohibited from returning to their original school pursuant to court order, where students are returning from a limited or full expulsion and there are circumstances that require that the student change schools, and/or where the student has been excluded from their original school. “Administrative transfers”, in contrast, are arranged between principals and are utilized where a student requires a compassionate transfer, where students are involved in serious incidents off-school property, or where the student’s continued presence in the school raises safety concerns regardless of whether the student is a victim or perpetrator. Both forms of transfer can be used to provide the student with a fresh start. There is no right of appeal from a decision to transfer a student to another school.9
The Panel found that the safe schools transfers in the School’s region usually followed alleged conduct of a serious criminal nature and were related to incidents both on and off school property.10
The concern about safe schools transfers was focused on the absence of a policy or procedure requiring programs or counselling for students before they transfer to the receiving school. The safe schools transfer students were described as “programless”11 and the “walking wounded”.12 Other issues of concern that were noted included: the difficulty of organizing schedules for students transferred mid-term or mid-semester, resulting in students having a high number of spares (also contributing to the problems of hallway students); that safe schools transfer students have a disproportionately negative impact on the environment of the receiving school; that students and teachers would learn of the circumstances of the student’s arrival at the school through a “whisper campaign”;13 that students are transferred within the same family of schools and often know students at the receiving school, thus detracting from the intended “fresh start”; and that safe schools transfers were being used as a form of discipline without the statutory procedural safeguards afforded to students subject to discipline in the Education Act.14
In light of the issues raised about safe schools transfers, it should be noted that transfers were listed as an acceptable form of progressive discipline in the 2007 settlement reached between the Ministry of Education and the Ontario Human Rights Commission following the Commission initiated complaint against the Ministry with respect to the Safe Schools Act. It is expected that, pursuant to the terms of the settlement, transfers will remain an acceptable form of progressive discipline, and may indeed be included in the anticipated Ministry of Education Policy/Program Memorandum regarding progressive discipline.
The Panel found, based on the questionnaire, that most students perceived the School to be a relatively safe environment, with the exception of the period immediately following the shooting death. The Panel canvassed students to identify the types of problems at the school, the rate of student victimization both on and off school property, the incidence of students witnessing a crime and reporting it, and how to improve safety and discipline at the School.15 The Panel found that the serious problems identified by the students included problems in the student-teacher relationship, disorder in the hallways, students who talk back and disrespect their teachers, discrimination by teachers against students, and the presence of weapons, drug dealing and gangs in the School. The Panel also found that a significant proportion of the students had been victims of threats, physical assaults, theft and other types of crime in the past two years, both on and off school property.16 The incidence of reporting crime to the police was low.17
A Final Report detailing systemic issues and broader recommendations is expected in November 2007. The Final Report will include the results of broader consultations. It is expected that the Final Report will focus on broader social issues, such as poverty, racism, sexism, violence and alienation, school-police relationships, the Ontario Human Rights Commission settlement with the Board and Ministry, as well as the erosion of student discipline and the increase in youth violence. The Final Report will also include reviews of other schools. The following is perhaps a precursor of the Report to come: “…the death of Jordan Manners should not be seen as an isolated incident, but rather as a disturbing harbinger of things to come if we, as a society, do not put a stop to the ongoing neglect of significant numbers of our youth. It is a harbinger because the influx of guns in this city has, in the words of one of our community agency deputants created the following sad reality: ‘It is easier to get a gun than get a job.’”18
* Nicola Simmons, Keel Cottrelle LLP.
1 School Community Safety Advisory Panel, An Interim Report on School Safety (August 28, 2007) at p.2 [Interim Report]. Specifically, the Panel was asked to review the practices and procedures at the high school in the two influencing the ability of the School or TDSB schools in general to maintain student order and discipline; and improving practices in TDSB schools with regard to prevention, school supervision, discipline and security in order to create a positive, safe and welcoming school environment.
2 Other results of the finding were that the Principal and Vice Principal of the School were placed on home assignment with pay, and the Police were notified and commenced an investigation.
3 Interim Report, supra note 1 at pp. 55-57.
4 In fact, 459 students completed the questionnaire; however, 36 of the questionnaires were unusable.
5 Interim Report, supra note 1 at pp. 15-18.
6 The Ontario Human Rights Commission initiated a public interest human rights complaint against the TDSB and the Ministry of Education in 2005 alleging that the TDSB’s application of the Safe Schools Act disproportionately affected racialized students and students with disabilities.
7 Interim Report, supra note 1 at p. 24.
8 Ibid. at pp. 25-28.
9 Ibid. at pp. 18-22. Note that a principal’s decision to transfer two students from a Toronto high school is currently under judicial review in the case K.B. v. Toronto District School Board before the Ontario Divisional Court.
10 Ibid. at p. 22.
11 Ibid. at p. 22.
12 Ibid. at p. 23.
13 Ibid. at p. 23.
14 Ibid. at pp. 22-24. Education Act, R.S.O. 1990, c.E-2.
15 Ibid. at pp. 33-52.
16 Ibid. at p. 53.
17 Ibid. at p. 48.
18 Ibid. at p. 3.
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Environmental Law
Recent Environmental Regulatory Changes and Initiatives
Barry Spiegel*
This article originally appeared in Environews, the OBA Environmental Law Section Newsletter, Volume 17, No. 1 - October/Octobre 2007.
Since the last edition of Environews, there have been a number of environmental developments on the regulatory and policy front, at both federal and Ontario levels, as Ottawa and Ontario have recently released an unprecedented flurry of new and important environmental statutes, regulations, policies and guidelines.
This article includes a table that identifies and briefly describes many of these changes and proposals. Readers may be particularly interested in some of the following developments:
- Ontario’s Environmental Penalties regime, Phase 1, came into force on August 1, 2007. Some of the complexities involved in determining the amount of such penalties are alluded to in the table below. It will be interesting to see how often this tool is used;
- Expanded regulatory requirements for any person reporting a spill took effect on August 1, 2007. Companies with potential for spills should update staff training and spill reporting protocols. Other spill-related initiatives include the Spill Prevention and Contingency Plans regulation and the updated Chemical and Waste Storage Guidelines;
- Regulations to implement the Budget Measures and Interim Appropriation Act, 20071 (Bill 187) changes to the Environmental Protection Act2 (“EPA”) and the Ontario Water Resources Act3 (“OWRA”) to clarify Brownfields liability are currently outstanding. It is expected that these regulations could be posted on the Environmental Bill of Rights Registry (“Registry”) for comment in spring of 2008. The regulations will deal with a new Record of Site Condition (“RSC”) review and filing process, and a complex new system for certifying RSCs where contamination may move off-site. It is also not clear at this point how the Ministry of the Environment (“MOE”) intends to address the current definition of a “qualified person” in O. Reg. 153/04 which sunsets in April 2008; and
- Items not typically characterized as environmental include Ontario’s Integrated Power System Plan for electricity and the Bill 51 amendments to the Planning Act.4
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Description |
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Proposed amendments to the Environmental Emergency regulations (SOR/2003-307) under the Canadian Environmental Protection Act, 1999 (“CEPA”). |
Petrochemical companies, farmers, mines and smelters, dry cleaners, and those that use or produce propane or specialty chemicals will be significantly impacted by these amendments. These proposed amendments would add 34 CEPA-toxic substances and “other substances of concern” (i.e., acetic acid, ammonium nitrate and styrene) to Schedule 1 of the regulations, triggering the need for environmental emergency planning by facilities that own or have control of more than the set threshold quantity of these substances. Additional amendments would cover reporting requirements, regulate propane storage and the decommissioning of facilities, exempt mine tailings and certain fertilizers used by farmers, and “increase the clarity of the text and reduce the administrative burden.” |
Notice in the Canada Gazette on June 9, 2007.
Closing date for comments was August 8, 2007.
The amendments would take effect on the day they are registered. |
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Proposed Storage Tank Systems for Petroleum Products and Allied Petroleum Products regulations under CEPA.
Would replace the Federal Registration of Storage Tank Systems for Petroleum Products and Allied Petroleum Products on Federal Lands and Aboriginal Lands regulations (SOR/97-10). |
Ottawa has expanded its storage tank requirements beyond a simple inventory system to ensure it can compel the repair or removal of leaking tanks. These proposed regulations would apply to storage tank systems owned or operated by federal departments, boards, agencies and Crown corporations, port authorities, railways and airports, and those located on federal and Aboriginal lands. They would also apply to the suppliers of petroleum products to such systems. The proposed regulations would address gaps in the existing requirements, including the power to withdraw leaking storage tank systems from service for repair and the permanent removal of high-risk systems, mandatory leak detection testing, requirements for the product transfer area, standards for the design and installation of new systems, a tank identification system, record keeping, leak notification, and other duties for suppliers. |
Notice in the Canada Gazette on April 7, 2007.
Closing date for comments was June 6, 2007.
Following promulgation, owners would have 2-4 years to remove prescribed tanks from service. |
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Second batch of substances under the federal Chemicals Management Plan (“CMP”).
(Visit www.chemicalsubstances.gc.ca for details.) |
The second batch includes some widely used substances: bisphenol A, thiourea, epichlorohydrin, isoprene, vinyl acetate, Pigment Red 104 and Pigment Yellow 34. The CEPA s. 71 notice requires importers, manufacturers and certain users of 15 of the 17 compounds in the second batch of CMP substances to submit certain information needed to assess the toxicity of the substances and/or their appropriate management and control.
Ottawa has released technical profiles for all 17 substances in the second batch. Interested stakeholders may submit any information that may be used to inform risk assessment and develop and benchmark best practices. |
Notice in the Canada Gazette on May 12, 2007.
Final date for submitting s. 71 reports was September 12, 2007.
CMP questionnaires must be submitted by November 17, 2007. |
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Third batch of substances under the federal CMP.
(Visit www.chemicalsubstances.gc.ca for details) |
The third batch includes some widely used substances including solvents, dyes and frequently used pigments, such as Pigment Red 3 and Pigment Orange 5. The CEPA s. 71 notice requires importers, manufacturers and certain users of the 19 compounds in the third batch of CMP substances to submit certain information needed to assess the toxicity of the substances and/or their appropriate management and control.
Ottawa has released technical profiles for all 19 substances in the third batch. Interested stakeholders may submit any information that may be used to inform risk assessment and develop and benchmark best practices. |
Notice in the Canada Gazette on August 18, 2007.
Final date for submitting s. 71 reports is December 18, 2007.
CMP questionnaires must be submitted by February 18, 2008. |
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Environmental Penalties regulation (O. Reg. 222/07) under the EPA and Environmental Penalties regulation (O. Reg. 223/07) under the OWRA. |
When Bill 133, the Environmental Enforcement Statute Law Amendment Act, passed in June 2005, the MOE was given the authority to impose Environmental Penalties (EPs) for spills without the necessity of going to court. The Ministry is phasing in those financial EPs in two stages, over the next 18 months. Both the EPA and OWRA regulations embody the same concepts and follow the same format. They set forth the details of how, when and to which types of violations (industrial spills, unlawful discharges, and other contraventions) EPs will be applied, and how the penalties collected can be used. The EP regulations will apply to 148 facilities in the Municipal-Industrial Strategy for Abatement (“MISA”) industrial sectors whose operations discharge directly into a surface water body. They will also apply to new facilities (if they are direct dischargers) in eight MISA sectors.
Additional guidance is found in the Guideline for Implementing Environmental Penalties (described below) and the MOE’s updated Compliance Policy: Applying Abatement and Enforcement Tools. Other relevant documents include Procedure for the Calculation of the Monetary Benefit Component of EPs, and Settlement Agreements — A Guide to Submitting Beyond Compliance Projects and Requesting Abatement Measures. |
Proposal posted on the Registry on October 6, 2006. Decision posted on the Registry on June 8, 2007.
Phase I of regulations (covering major violations) in force on August 1, 2007, and Phase II takes effect on December 1, 2008. |
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Guideline for Implementing Environmental Penalties in accordance with O. Reg. 222/07 and O. Reg. 223/07 under the EPA and OWRA. |
A company subject to an EP order can have the amount of the penalty reduced based on the actions it took before, during and after an incident. This Guideline provides an explanation of EPs including which companies are subject to EPs, types of EP violations, a step-by-step guide to the EP process, calculation of the EP amount, and a description of key process and appeal components. |
Guideline dated May 2007 and posted on the Registry on June 8, 2007. |
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Environmental Penalties – Code of Toxic Substances as referred to in O. Reg. 222/07 and O. Reg. 223/07 under the EPA and OWRA. |
If a spill or other violation involves a prescribed “toxic” chemical, a Director issuing the EP order will increase the gravity component of the penalty by 35%. This Code defines and lists the toxic compounds that trigger an increase, and is housed outside of the EP regulations so that it can be readily amended. The list of toxic substances in the document currently includes 113 substances that are non-gaseous, persistent, bioaccumulative and inherently-toxic to humans. |
Code published in May 2007 and posted on the Registry on June 8, 2007. |
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Spill Prevention and Contingency Plans regulation (O. Reg. 224/07) under the EPA. |
The spill planning regulation applies specifically to existing and new facilities in the nine industrial sectors subject to the MISA regulations made under the EPA. The regulation sets forth the requirements for developing and implementing spill prevention and contingency plans, the information such plans must include, record keeping and notification requirements, a duty to undertake annual reviews and tests of the plan, and reassessment of the plans after a spill. Additional guidance is found in the Guideline for Implementing Spill Prevention and Contingency Plans Regulatory Requirements (described below). |
Made May 16, 2007 and printed in The Ontario Gazette on June 23, 2007. In force on September 1, 2008. |
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Guideline for Implementing Spill Prevention and Contingency Plans Regulatory Requirements in accordance with O. Reg. 224/07 under the EPA. |
Many of the factors considered for EP reductions (under s. 16 of O. Reg. 222/07 and s. 15 of O. Reg. 223/07) are also components of a spill prevention and contingency plan. This Guideline is designed primarily for companies that must develop and implement these plans under O. Reg. 224/07. It explains key terms and provides guidance on the development and implementation of the plans (including plan components, hazard identification, risk analysis and priority ranking, contingency planning, reporting, spill response, environmental restoration, annual reviews and updates).
The Guideline is also of use to facilities exempt from O. Reg. 224/07 (i.e., commercial businesses, non-MISA industries, municipalities, etc.) in establishing Class X non-reportable spill thresholds under O. Reg. 675/98. It is a useful resource for implementing spill prevention and/or contingency plans for due diligence and environmental management system purposes. |
Guideline dated May 2007 and posted on the Registry on June 8, 2007. |
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Classification and Exemption of Spills and Reporting of Discharges regulation (O. Reg. 225/07 amending O. Reg. 675/98) under the EPA. |
This regulation amends the reporting and notification provisions of the existing spills reporting regulation (O. Reg. 675/98). It replaces the provisions relating to Class X, “Non-Reportable Spills,” and adds a new Part II, “Reporting of Spills,” which set out notification requirements under s. 15(1) and s. 92(3) & (4) of the EPA, as well as the information that must be provided to the MOE’s Spills Action Centre. Additional guidance is found in Spills Reporting: A Guide to Reporting Spills and Discharges (described below). Companies that have potential for spills should retrain first contact employees and review spill investigation and reporting procedures and documentation. |
Spill reporting provisions in force on August 1, 2007. Changes to Class X non-reportable spill provisions in force on September 1, 2008. |
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Spills Reporting: A Guide to Reporting Spills and Discharges as required by s. 92 and s. 15 of the EPA and O. Reg. 675/98. |
This Guide summarizes who must report, who must be notified, when to report, and mandatory reporting details. The Guide offers practical guidance for the classification of spills and exemptions, and explains in greater detail the MOE’s interpretation of the spill reporting provisions under s. 92 of the EPA, and discharges that must be reported under s. 15(1) of the EPA and the new O. Reg. 675/98 reporting requirements. |
Guideline dated May 2007 and posted on the Registry on June 8, 2007. |
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Ontario’s Guidelines for Environmental Protection Measures at Chemical and Waste Storage Facilities. |
The first update since 1978, this Guideline is used by MOE staff to develop Certificates of Approvals (C of A), promote abatement measures on inspection, draft orders, and respond to spills. It is also designed to help the owners and operators of chemical and waste storage facilities assess the necessary environmental protection measures, plan upgrades to existing storage areas, and design and operate new facilities. A C of A may require the development of an operations and maintenance manual to be based on the Guidelines spelled out in this document. |
Draft version circulated in April 2005. Final version published in June 2007. |
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Bill 198, Safeguarding and Sustaining Ontario’s Water Act, 2007.
Amends the OWRA and the Safe Drinking Water Act, 2002. Repeals the unproclaimed Water Transfer Control Act. |
Ontario is set to impose a modest “water conservation charge” for commercial and industrial water users, as well as require permits for users that were grandfathered into the current system. The Act implements the Great Lakes-St. Lawrence River Basin Sustainable Water Resources Agreement, provides a statutory basis for Ontario’s existing ban on diversions of the Great Lakes-St. Lawrence River, Nelson and Hudson Bay basins, and prohibits new or increased diversions from one Great Lake watershed to another (subject to certain regulated exceptions). It also amends the OWRA to clarify and update the types of conditions that can be imposed through Permits-to-Take-Water (PTTW), to require PTTWs for water takings over 50,000 Litres per day, and for takings that started before March 29, 1961 (which are currently exempt). Future regulations would set the water charges and phase-in schedule (the province is proposing to begin charging “highly consumptive industrial and commercial users” $3.71/ million L), as well as requirements for water conservation and water use efficiency and standards for proposed water withdrawals and large consumptive water uses. |
Received Royal Assent on June 4, 2007.
Comes into force upon Royal Assent, except for s. 1(6), (8), (9), (11), (12), (17), (18), (19), (22), ( | | |
