80% of life is just showing up

Fascinating decision here from the District Court for the District of Columbia. America's National Labor Relations Board has been at the centre of controversy recently because of President Obama's inability to appoint new members. Before he made recess appointments to restore the full complement of members, the Board took an important decision which would have had the effect of making it easier for unions to become certified for collective bargaining purposes.

But the decision was challenged by a couple of employers' interest groups and ultimately ran aground on the Board's statutory quorum requirement. Three members must "participate" in any decision:

But whether the standard is “mere presence” or “participation,” the difficulty is in applying that standard to an online vote. When the very concept of a quorum seems designed for a meeting in which people are physically present in the same place, what does it mean to be present or to participate in a decision that takes place across wires? In other words, how does one draw the line between a present but abstaining voter (who may be counted toward a quorum) and an absent voter (who may not be) when the voting is done electronically? 

Here, a draft of the proposed rule was circulated by email to all three remaining members. Two indicated an affirmative response. The third never responded, not realizing that his failure to do so would lead to a failure to participate. To no avail, the Board argued that the third member's participation in previous discussions  and procedural decisions (in which he had made his opposition clear) and his subsequent release of a statement explaining his opposition satisfied the quorum requirement.

As District Judge Boasberg explained:

[H]e simply did not show up – in any literal or even metaphorical sense. Had he affirmatively expressed his intent to abstain or even acknowledged receipt of the notification, he may well have been legally “present” for the vote and counted in the quorum. Had someone reached out to him to ask for a response, as is the agency’s usual practice where a member has not voted, or had a substantial amount of time passed following the rule’s circulation, moreover, it would have been a closer case. But none of that happened here. In our prior world of in-person meetings, Hayes’s actions are the equivalent of failing to attend, whether because he was unaware of the meeting or for any intentional reason. In any event, his failure to be present or participate means that only two members voted, and the rule was then sent for publication that very day.

One other interesting point is the footnoted discussion of the applicability of Chevron deference to the Board's interpretation of its statutory provisions. There is, as the judge noted, an argument that a reviewing court should defer to the Board's determination of whether the quorum requirement has been satisfied: that is, if the Board considers it unnecessary for a formal vote to be recorded, a reviewing court should not interfere. But in the New Process Steel case, the Supreme Court of the United States did not apply Chevron deference to the quorum provision; and, stranger still, the Board did not raise the point in its argument.

As the judge noted, Woody Allen was quite correct to observe that 80% of life is just showing up.

H/T Jonathan Adler at the Volokh Conspiracy.

Avoiding 'Charter-Free' Zones

One of the questions not broached by the Supreme Court of Canada in Doré (see my earlier post here) was what happens when the legislature has attempted to exclude consideration of the Charter by an administrative decision-maker.

In a pair of decisions released in 2003, the Court made clear that where an administrative decision-maker has an express or implied power to determine questions of law, it will also have the power to adjudicate on Charter or constitutional challenges to its governing statute, as long as that power has not been excluded by the legislature, expressly or by necessary implication. More recently, the Court has held that an administrative decision-maker which is not lumbered with these impediments may go on to award Charter remedies, as long as the remedy sought is the kind of remedy that the legislature intended would fit within the statutory framework of the particular tribunal.

In both British Columbia and Alberta, there are statutory provisions preventing certain decision-makers from considering Charter arguments. The next question is how broadly those provisions should be read, given the need for express or necessarily implicit exclusion of the power to decide Charter questions.

In Rio Tinto Alcan Inc. v. Carrier Sekani Tribal Council, the question was whether the B.C. Utilities Commission could consider whether the province had adequately discharged its constitutional duty to consult with First Nations. The Court held that the Commission had a general power to consider questions of law and, thus, constitutional questions. It then drilled down into the provision of the B.C. Administrative Tribunals Act that sought to remove the Commission's power to consider constitutional questions (s. 44, as further defined by s. 1 and a related statute). Taking a close look at the terms of the relevant statutory provisions, the Court concluded that only challenges to the constitutional validity or constitutional applicability of a law, or an application for a constitutional remedy, were precluded. The Court accepted that, in broad terms, the challenge was constitutional in nature, but that the statutory provisions did not indicate a clear intention on the part of the legislature to exclude from the Commission’s jurisdiction the duty to consider whether the Crown has discharged its duty to consult with holders of relevant Aboriginal interests (at para. 72).

Another way to put the same point might be that in exercising its powers, the Commission was obliged to do so in a manner consistent with constitutional principles and provisions; this is hardly a radical proposition (see e.g. para. 56 here), but it would be radical to oblige an administrative decision-maker not to exercise its powers in a manner consistent with constitutional principles and provisions.

However, this line of argument might run into difficulty when faced with a more comprehensive legislative attempt to oust Charter jurisdiction, as the Alberta Court of Appeals recently explained in United Food and Commercial Workers, Local 401 v Alberta (Attorney General). Here, the question was whether an adjudicator appointed by the Information and Privacy Commissioner had acted reasonably in determining that a union could not collect and use video recordings of individuals crossing a picket line. The adjudicator never considered the effect of its decision on Charter rights, because of s. 11 of the Administrative Procedures and Jurisdiction Act, a general ouster of Charter jurisdiction that can only be reversed by the provincial cabinet. The ouster provisions are very broadly drawn and apply to:

(i)    any challenge, by virtue of the Constitution of Canada or the Alberta Bill of Rights, to the applicability or validity of an enactment of the Parliament of Canada or an enactment of the Legislature of Alberta, or

(ii)    a determination of any right under the Constitution of Canada or the Alberta Bill of Rights.

It was thus "beyond the mandate" of the adjudicator to "engage" Charter issues (at para. 44).  The Court of Appeal gave a nod to the need to consider fundamental values (at para. 42), but it remains to be seen how broadly this nod will be interpreted.

It is worth emphasizing that Justice Abella noted in Doré that administrative decision-makers "must act consistently with the values underlying the grant of discretion, including Charter values" (at para. 24). With the reference to "values", it seems open to an individual to argue that the decision-maker has to take account of Charter values, such as fairness, justice and equity without the individual having to prove that an actual Charter right has been infringed. Even the broadly drawn provisions in the Alberta legislation do not prevent Charter values being taken into consideration.

The challenge for applicants, advocates and, indeed, decision-makers who wish to consider Charter issues despite legislative attempts to prevent them from doing so, will be to couch their arguments in terms of values rather than in the technical terms of Charter rights and proportionality tests.

Unanswered Questions post-Dunsmuir

In a recent decision, Justice Stratas of the Federal Court of Appeal raised a host of questions about the applicability of the Supreme Court of Canada's re-shaping of judicial review doctrine to decisions taken by discretionary decision-makers:

[19]           I am inclined to find that the Director is subject to this “normal” or “usual” position of deference to his decision-making. But there exists considerable uncertainty on this, arising from Dunsmuir itself, previous case law, and the unusual circumstances of this case:

(a)        We are dealing with a Ministerial delegate, not a “tribunal” in any formal sense. In Dunsmuir the Supreme Court used the word “tribunal” on this point. In my view, although it is not perfectly clear, in Dunsmuir the Supreme Court did not intend to restrict this position of deference to interpretations by formal tribunals. Throughout its discussion of the standard of review, the Supreme Court used the terms “tribunal,” “decision maker,” “exercises of public authority,” “administrative bodies,” “adjudicative tribunal,” “adjudicative bodies,” “administrative tribunal,” and “administrative actors”: Dunsmuir, supra at paragraphs 28-29, 31, 33, 41, 47-50, 52, 54-56, and 59. It seems to have used the terms interchangeably and, collectively, they are wide enough to embrace a Ministerial delegate such as the Director.

(b)        In a relatively recent decision, albeit before Dunsmuir, the Supreme Court did not defer to the interpretation of a Ministerial delegate who was interpreting a statute closely related to his function: Hilewitz v. Canada (Minister of Citizenship and Immigration); De Jong v. Canada (Minister of Citizenship and Immigration), 2005 SCC 57 (CanLII), 2005 SCC 57, [2005] 2 S.C.R. 706, (a visa officer making an assessment under subparagraph 19(1)(a)(ii) of the Immigration Act, R.S.C. 1985, c. I‑2); see also Canada (Minister of Citizenship and Immigration) v. Patel, 2011 FCA 187 (CanLII), 2011 FCA 187 and cases cited at paragraph 27 of Patel. This is certainly consistent with how we today approach decisions involving some other Ministerial delegates. For example, in the income tax context, income tax assessors – Ministerial delegates – are very familiar with the Income Tax Act. One might think that the normal administrative law standard of review analysis would apply to appeals of these administrators, with deference to their legal interpretations being the result: see, e.g., Canada (Director of Investigation and Research) v. Southam Inc., 1997 CanLII 385 (SCC), [1997] 1 S.C.R. 748 and Dunsmuir, supra at paragraph 54. But it does not. The Tax Court of Canada, sitting in appeal on income tax assessments, and this Court do not defer at all to the statutory interpretations of the Minister’s delegate.

(c)        The Supreme Court spoke in Dunsmuir of deference to interpretations of certain types of “statutes.” Did it mean to restrict this principle to “statutes”? There would appear to be no principled basis to do so. Deference probably also applies to interpretations of other types of laws, such as the Order in Council in this case.

(d)        The Director’s title seems to suggest that he administers programs such as this, and so he could be considered to be interpreting what Dunsmuir described as a law “closely connected with [his] function,” warranting our deference. But there is no evidence in the record on this one way or the other, nor would one expect there to be such evidence given the narrow nature of a record on judicial review.

(e)        The position of deference for administrative interpretations of statutes is said in Dunsmuir to apply only “usually” or “normally.” Does this qualification refer to the situations mentioned in Dunsmuir where the correctness standard applies? Perhaps not, as these situations largely do not involve issues of statutory interpretation. Does this qualification refer to some as yet unidentified situations? We simply do not know.

(f)         In this particular case, as we shall see, the Director did not engage in any actual interpretation of the Order in Council. Rather, he simply interpreted and applied an administrative policy made under that Order in Council. Does this mean that the Director’s decision is subject to correctness review? I am not so sure. There are statements in Dunsmuir that suggest that the Director’s failure to interpret the Order in Council may not matter. In two places in Dunsmuir, the Supreme Court suggests that in assessing the substance of decision-making under the reasonableness standard we are to examine the outcome reached by the decision-maker and not necessarily the plausibility of the reasons actually given. At paragraph 47, we are directed to ask ourselves “whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law” and at paragraph 48 we are told that an administrative decision can be supported on the basis of reasons that “could [have] be[en] offered” [emphasis added].

(g)        I am not alone in my doubts on this issue. Recently, this Court discussed Dunsmuir and the standard of review that should apply to the Governor in Council’s interpretation of a statute. It found the law in this area to be unclear: Global Wireless Management Corp. v. Public Mobile Inc., 2011 FCA 194 (CanLII), 2011 FCA 194 at paragraph 35.

But the Court does not seem to be interested in resolving these questions. Leave to appeal was refused in that case, the Minister of Fisheries and Oceans has not appealed the decision that his interpretation of the Species at Risk Act was not entitled to deference, and now the Court has refused leave to appeal in the Globalive case.

Perhaps the Court has had enough of administrative law for a while.

Separate Silos

One of the reasons offered by the concurring judges in Multani for merging administrative review and constitutional review (at least when an individualized decision was challenged) was that keeping them separate and distinct would be confusing to lower courts and litigants. That view never seemed particularly compelling to me: lawyers and judges often make and are faced with arguments that overlap and complement one another.

Interestingly, in Pridgen v. University of Calgary, where students punished for making nasty comments about a professor on a Facebook group successfully sought the quashing of the disciplinary measures against them, two of the judges on the Alberta Court of Appeal expressly avoided dealing with an argument based on the Charter, preferring instead to resolve the case on administrative law grounds. Even Madam Justice Paperny, who dealt with the Charter issue (the tricky part being whether it applies at all to universities), addressed the administrative law argument separately, agreeing that the disciplinary decision was unreasonable.

Her judgment is also notable for its treatment of the reliance by the decision-maker on hearsay evidence. She correctly noted that administrative decision-makers have more leeway than courts in permitting the introduction of hearsay, but that this leeway was exceeded in the present case:

[59]           It is generally open to administrative tribunals to admit hearsay evidence. But the relaxation of the rules of evidence does not relieve an administrative decision‑maker of the responsibility to assess the quality of the evidence received in a reasonable manner in order to determine whether it can support the decision being made. And in a subsequent judicial review, the reviewing court must consider whether the decision is “one of a range of possible outcomes”, based on the evidence that was received and assessed by the decision‑maker. It is not an error for a reviewing judge to consider the quality of the evidence and the manner in which it was assessed in conducting that analysis.

[60]           The evidence on which the University relies is not merely hearsay, it is double or triple hearsay of an extremely vague nature from an unnamed source or sources. It is simply not reasonable to conclude that “injury” within the meaning of the Student Misconduct Policy has been established on the basis of the information provided to the Review Committee, and the chambers judge committed no error in reaching that conclusion.

Thus in response to the students' argument that the decision did not conform to the University's own guidelines, the University was unable to demonstrate that its reasoning was cogent or that sufficient evidence existed in support of its decision, and its decision was unreasonable.

The Charter and Administrative Adjudication

The Supreme Court of Canada has been feverishly productive in the field of administrative law since the Fall of 2011, rendering decisions on standard of review (questions of law, jurisdictional error and labour arbitrators), the right to reasons, issue estoppel, attempts to pre-empt the administrative decision-making process, and review of municipal by-laws. Plenty of grist for my mill over the coming weeks and months.

To my mind, the most dramatic of these recent decisions is that of a unanimous Court in Doré v. Barreau du Québec. Dramatic because the Court overruled a recent precedent, Multani, itself merely the confirmation of a consistent line of reasoning which can be traced back to the Court's decision in Slaight Communications v. Davidson. And the most dramatic because it has implications both for how administrative decision-makers consider Charter arguments and how courts should approach applications for judicial review on the basis that Charter rights were infringed by an administrative decision-maker.

Briefly, a majority of the Court held in Multani that administrative law and constitutional law must be distinguished. When a legislative provision expressly or implicitly infringes a Charter right, the applicant must challenge the validity of the provision in question. When the source of the alleged infringement is the exercise of a discretionary power, the applicant must challenge the validity of the exercise of the discretionary power. This can be accomplished in one of two ways: the applicant can argue on classic administrative law grounds that the power was exercised in an illegal, unreasonable or procedurally unfair manner; or the applicant can argue on constitutional law grounds that the power infringed his or her Charter rights in a disproportionate manner. There were two sets of concurring reasons disagreeing with the analytical approach of the majority, one authored by Justice Abella (joined by Justice Deschamps) and the other authored by Justice LeBel. If the two sets of concurring reasons could be said to have a common theme, it was that the proportionality test applied to determine the proportionality of infringements of Charter rights was inappropriate where the applicant challenged an individualized decision rather than a legislative provision.

In Doré Justice Abella's vision of the relationship of the Charter and administrative law won out. The applicant was a lawyer who was reprimanded by his regulatory association for writing an intemperate letter to a trial judge with whom he had locked horns. The dispute between the two was extremely heated, but the letter was not made publicly available. The lawyer did not challenge the validity of the Code of Ethics under which he was punished, but challenged the decision as a violation of his right to freedom of expression.

Justice Abella was able to draw on significant academic authority for her decision to over-rule a very recent precedent, noting that the commentary post-Multani has been "consistently critical" (at para. 33). I have argued in Chapter 5 of my forthcoming book, A Theory of Deference in Administrative Law, that the Court got it right in Multani, but it seems I may be in a minority of one! This is not the place to detail those arguments, but it is worth noting a couple of mis-steps on Justice Abella's part. For one thing, at para. 52, she wrongly conflates the application of the proportionality test with review for correctness. It is in fact a review for proportionality, not correctness, and does not allow the reviewing court to step into the shoes of a decision-maker exercising a discretionary power. Why? The correct interpretation of the Charter is that proportionate limitations on rights are acceptable, not that whenever a Charter challenge is made the reviewing court must substitute its judgment for that of the decision-maker. For another, at para. 56, she takes the most deferential possible view of the proportionality test (that an infringement is proportionate if it falls within a range of reasonable alternatives), in order to suggest a commonality between review for proportionality and review for unreasonableness. But viewed in the round, the multi-pronged proportionality test is much more rigorous than review for unreasonableness. It is hard to see how the purposes of the Charter are served by lowering the standard of protection afforded to Charter rights.

Nonetheless, her guidance to decision-makers is clear and cogent:

How then does an administrative decision-maker apply Charter values in the exercise of statutory discretion?   He or she balances the Charter values with the statutory objectives.  In effecting this balancing, the decision-maker should first consider the statutory objectives...Then the decision-maker should ask how the Charter value at issue will best be protected in view of the statutory objectives.  This is at the core of the proportionality exercise, and requires the decision-maker to balance the severity of the interference of the Charter protection with the statutory objectives (at paras. 55-56). 

It is hard to quibble with this approach. Administrative decision-makers ought not to be hamstrung by a requirement to conduct a formalistic inquiry into whether their decisions would survive the application of the proportionality test, as the House of Lords has recognized. Rather, they should attempt to achieve their statutory objectives with one eye on the Charter interests and other social values at play. There is no need to 'legalize' or 'judiciarize' administrative processes. Indeed, if it were desirable to do so, then the various functions of administrative decision-makers could be handed over to courts. Conscious decisions to keep matters away from the courts, at least initially, should be respected, and Justice Abella's guidance coheres with the general aim of providing non-judicial machinery for the resolution of disputes.

But applauding this aspect of Justice Abella's reasons is not to applaud her guidance to reviewing courts:

On judicial review, the question becomes whether, in assessing the impact of the relevant Charter protection and given the nature of the decision and the statutory and factual contexts, the decision reflects a proportionate balancing of the Charter protections at play...If, in exercising its statutory discretion, the decision-maker has properly balanced the relevant Charter value with the statutory objectives, the decision will be found to be reasonable (at paras. 57-58).

Instead of the rigorous, well-known and well-defined proportionality test, reviewing courts are henceforth required to conduct some sort of balancing test. Questions abound: what is a "proportionate balancing" that is not an application of the proportionality test? Is there a difference between a "proportionate balancing" and "properly balanced" and if so, what is it? What weights are to be given to the "Charter value" and the "statutory objectives"? Do different Charter values have different weights? What is the "nature of the decision" and how does it influence the analysis? Can it really be said that this formulation is adequately protective of Charter rights? It will be interesting to see how lower courts address these questions.

The ultimate conclusion in Doré is rather unsatisfactory. Justice Abella signs off by commenting that, given the "excessive degree of vituperation in the letter’s context and tone", the decision to reprimand the applicant "cannot be said to represent an unreasonable balance of Mr. Doré’s expressive rights with the statutory objectives" (at para. 71). There is much emphasis in her discussion on the need to maintain civility in the legal profession, but there is no searching analysis of the extent to which the disciplinary committee actually did consider the applicant's interests in freedom of expression. Criticism may be robust, but may not exceed the "public’s reasonable expectations of a lawyer’s professionalism" (at para. 69). However, the fact that the letter was not made publicly available does not feature in the analysis. No attention is paid to the context in which the letter was written, most likely at a time when the author's tempers were running temporarily high. Absent too is any consideration of whether a formal reprimand was necessary to achieve the statutory objectives, though this is not surprising considering the replacement of the proportionality test with a less robust balancing exercise.

The fear I express in A Theory of Deference is that the sort of approach championed by Justice Abella will be under-protective of Charter rights. Hopefully this fear will not be borne out, but Doré does not seem to represent a promising start.

When Reasonable Minds Differ

Some philosophical reflections, courtesy of Justice Martineau:

[92]           The legal explanation for allowing two [differing] interpretations of the law, if reasonable, to stand is simply that courts must respect the legislator’s intention that such types of administrative decisions, which are protected by a privative clause, be not reviewed unless the tribunal has acted without or beyond its jurisdiction. This may sound strange to persons who are not familiar with judicial review and its subtleties, and I find it worthwhile to quote what late professor Chaïm Perelman (1912-1984) was writing in a text entitled “What the philosopher may learn from the study of law”, reproduced in annex to his work Justice, published in 1967 (Random House, New York) at page 94:

The diversity of laws is proof of our ignorance of true justice. That which conforms to reason cannot be just here and unjust there, just today and unjust tomorrow, just for one and unjust for another. That which is just in reason should, like that which is true, be so universally. Disagreement is a sign of imperfection, of a lack of rationality.

If two interpretations of the same text are reasonably possible, it is because the law is ambiguous, therefore imperfect. If the law is clear, then at least one of the two interpreters disputes in bad faith. In any case, disagreement is a scandal, due either to the imperfection of the legislator or to the deceptive subtlety of the lawyers. The innate sense of justice, which each equitable judge certainly possesses, should permit the rapid reestablishment of correct order.

[93]           That said, professor Perelman goes on at page 96 to provide a philosophical answer to such apparent injustice or human imperfection by telling this short anecdote:

The Jewish tradition, which never sought to conceive law on a scientific model, offers a significant story in this connection. In the Talmud two schools of biblical interpretation are in constant opposition, the school of Hillel and that of Shammai. Rabbi Abba relates that, bothered by these contradictory interpretations of the sacred texts, Rabbi Samuel addresses himself to heaven in order to know who speaks the truth. A voice from above answers him that these two theses both expressed the word of the Living God. The lesson of this story is clear: Two opposing interpretations can be equally respectable, and it is not necessary to condemn as unreasonable at least one of the interpreters.

In fact, we admit that two reasonable and honest men can disagree on a determined question and thus judge differently. The situation is even considered so normal, both in legislative assemblies and in tribunals that have several judges, that decisions made unanimously are esteemed exceptional; and it is normal, moreover, to provide for procedures permitting the reaching of a decision even when opposing opinions persist.

As a supporter of deference and interpretive pluralism it is nice to see such weighty authority. From my lips to God's ears, I might even mutter...

A Slightly Less Cold House for Foreign Investors

One of the components of the Federal Government's omnibus budget bill, the Jobs, Growth and Long-term Prosperity Act, involves amendments to the Investment Canada Act. In certain circumstances, take-overs by foreign persons of Canadian corporations must be reviewed by the Minister for Industry and, if the Minister concludes that the proposed investment is not of "net benefit" to Canada, the foreigners have to remain on the outside looking in. Aliant Techsystems and BHP Billiton saw their take-over efforts run aground on the net benefit rock, as Kevin Ackhurst reminds us.

Decisions by the Minister are to be taken within 45 days, although there is a power to extend the time for decision. If the decision is negative, further submissions can be made, but the reasons for the decision need not be disclosed until a final decision is reached. Not an ideal situation for a multi-national corporation with potentially billions of dollars on the table, and not hard to perceive how this might chill the enthusiasm of foreign investors (as if it were not cold enough here already...).

Amendments to the decision-making process are now proposed, along with the introduction of a ministerial power to accept offers of security. The amendments to the decision-making process do not change the basic infrastructure of the Act, but the Minister will have a little bit more elbow room to disclose concerns about proposed investments early in the decision-making process. Strangely, this does not seem to be accompanied by a provision allowing proponents to amend their applications, but presumably a 'right to respond' to concerns raised by the Minister will be read in to the statutory scheme, on the basis that procedural fairness requires it (see, e.g., para. 17 here).