Voice Construction Ltd. and
Lethbridge Community College:
A
fundamental shift in standard of review of
arbitrators?
Jo-Ann Kolmes, Chivers Carpenter,
Edmonton, Alberta
CALL/ACAMS Conference
2004
Introduction
In Voice Construction Ltd. v. Construction &
General Workers’ Union, Local
92[1] (“Voice
Construction”), and Alberta Union of Provincial Employees v.
Lethbridge Community College[2] (“Lethbridge Community College”), the Supreme Court of Canada
appears to have made a fundamental shift in the standard of review applicable to
arbitrators’ interpretation and application of collective agreements.
The Court has concluded that the standard of reasonableness simpliciter
rather than patent unreasonableness applies to this quintessential arbitral
function. This may well amount to a signal of permission to lower courts to
take a more interventionist approach to judicial review.
Voice
Construction
The
grievance
The grievance in the Voice Construction case
arose out of the refusal by Voice Construction Ltd. (the “Employer”)
to hire a worker dispatched by the Construction & General Workers’
Union, Local 92 (the “Union”) through the hiring hall system in the
construction industry.
The arbitrator’s
award
Arbitrator Phyllis Smith upheld the
grievance.[3] She identified the
issue as whether certain provisions in the Collective Agreement had the effect
of restricting the Employer’s management right to hire and select
employees. The management rights article provided that “subject only to
the terms of [this] agreement,” the employer had the right “to hire
and select workers.” The Arbitrator recognized that restrictions on
management rights to hire and select must be express. She held that such
restrictions were expressly contained in the Collective
Agreement.
She reasoned that inclusion of
certain articles (one relating to name-hiring, permitting the employer to
name-hire the first 20 employees on a jobsite and thereafter 1 in 4, the other
providing that the Employer could notify the Union not to dispatch former
employees who had been terminated for cause) must have been intended to impose
restrictions on the right of selection – otherwise they would be
redundant.
She reasoned that the only
conclusion that could be reached was that, generally speaking, properly
qualified workers dispatched by the Union were to be hired.
The Court of Queen’s
Bench
Justice Dea of the Court of Queen’s Bench set
aside the Award on the basis
that:[4]
The Collective Agreement had no express
restriction on management’s right to hire and select.
The Arbitrator found a restriction by implying
it from other provisions.
The effect of this was to amend the collective
agreement.
While he would be “uneasy to characterize
the arbitrator’s conclusions as ‘patently
unreasonable,’” the error was jurisdictional.
Altering or amending the collective agreement
is in excess of arbitrators’ jurisdiction under s. 140 of the Labour
Relations Code and Article 15.10 of the Collective Agreement (no altering or
amending).
The test pertaining to jurisdictional errors is
correctness.
The Court of
Appeal
The majority of the Court of Appeal adopted the
reasoning of Justice Dea and dismissed the
appeal.[5] McClung, J.A., writing for
the majority, also commented that (para. 5):
Management rights in this area are a critical pillar in
modern industrial relations. We must remember that Alberta’s burgeoning
construction industry requires no less; contracted work must be completed.
And it must be performed under deadlines. This is beneficial to labour, management
and the industry itself. Only an unruffled hiring and selection process can
contribute to this. In matters of selection and hiring, unnecessary wobbles
should not be encouraged.
Berger J.A.
dissented, finding that the balance between Employer interests and Union
interests had been expressly stated in Article 6.02, the name-hire provision.
He held that a limited right to name hire is inconsistent with an unlimited
right to select. Berger J.A. concluded that the Arbitrator was correct, and the
decision could not be characterized as either patently unreasonable or
unreasonable.
The Supreme Court
At the oral hearing on January 23, 2004, the Supreme
Court indicated it did not need to hear from counsel for the Appellant Union.
Lyle Kanee was the principal counsel for the Union. After hearing from counsel
for the Respondent Employer, the Court allowed the appeal from the Bench,
indicating that reasons were to follow.
The
Supreme Court issued its reasons April 8, 2004. Justice Major wrote for the
majority. The concurring reasons of Justices LeBel and Deschamps were delivered
by Justice LeBel. For the majority, Major J. held that:
The applicable standard of review was that of
reasonableness simpliciter (para. 30).
As explained by Iacobucci J. in Ryan, a
decision will be unreasonable “only if there is no line of analysis within
the given reasons that could reasonably lead the tribunal from the evidence
before it to the conclusion at which it arrived” (para. 31).
The Arbitrator’s conclusion was
reasonable given the terms of the collective agreement (para.
36).
In the concurring reasons, Justice LeBel
wrote that he agreed that the appropriate standard of review was reasonableness
and that the Arbitrator’s interpretation of the hiring provisions in the
collective agreement was reasonable (para.
39).
In considering the standard of review, the
majority applied the functional and pragmatic inquiry. Major J. set the tone
with the comment that “application of patent unreasonableness will be
rare.”
In relation to the first factor,
presence of a privative clause, Justice Major found that the provisions
of the Labour Relations Code “do not provide the protection of a
full privative clause.” Justice Major referred to the article in the
collective agreement providing for “final and binding settlement,”
but provided no comment or analysis of the effect of such provision. He held
that a partial privative clause, in the absence of other factors, “does
not bestow the greatest degree of deference.”
In relation to expertise, Major J.
noted that arbitrators “are likely ... to have more experience and
expertise in interpreting collective agreements.” This, according to the
majority, “favours a certain degree of curial
deference.”
In
relation to the factor of the purpose of the statute, the majority noted
the purpose as being the resolution of labour disputes in the most efficacious
and least disruptive way. The majority contrasted the purpose of labour boards
(involving “polycentric” decision-making) with arbitrators
(resolving two-party disputes). However, the majority concluded that this
factor suggested a deferential standard of
review.
On the factor of nature of the
problem, Justice Major characterized the interpretation of the terms of a
collective agreement as a “question of law.” He noted that
generally speaking, questions of law are subject to more searching review. He
then noted that interpretation of collective agreements is at the core of an
arbitrator’s expertise. He concluded that this factor pointed to
“some deference.”
Even though three out of the four factors (and
possibly even the factor of partial privative clause) pointed to deference, the
Court concluded that the applicable standard was reasonableness
simpliciter, the less deferential
standard.
In applying the standard of
reasonableness simpliciter to the Award, the majority considered the
issue of what constitutes an express provision as compared to an implied
provision. The majority held that it was reasonable for an “express” restriction to be found through the operation of other
provisions. Justice Major made a very key statement (para. 35): “An
‘express’ restriction may nonetheless be open to
interpretation.” In other words, express restriction may be found through
interpretation of the language of a provision.
Lethbridge Community
College
The grievance
The grievance in Lethbridge Community College
arose out of the dismissal of a scheduling coordinator on the grounds that her
work performance was unsatisfactory.
The Arbitration
Award
An arbitration board chaired by Arbitrator McFetridge
found that the grievor’s circumstances reflected a non-culpable deficiency
on the basis that her inability to meet the requirements of her position was
due to incompetence.[6] The Board found
that just cause for discharge had not been shown, since the employer had failed
to comply with the requirements set out in Re Edith Cavell Private Hospital
and Hospital Employees Union, Local
189[7] for dismissal of an
employee on grounds of non-culpable deficiency. Under the Edith Cavell
criteria, an employer must first (a) define the level of job performance
required, (b) communicate that standard to the employee, (c) provide reasonable
supervision and instruction and allow the employee a reasonable period of time
to reach the standard, (d) establish an inability on the part of the employee to
reach the requisite standard to an extent rendering the individual incapable of
perform9int th3e job and that reasonable efforts were taken to find alternative
employment within the competence of the employee, and (e) provide reasonable
warnings to the employee to convey that a failure to meet the standard could
result in dismissal.[8] The Board
found that the employer had failed this test since a reasonable effort was not
made to find the grievor an alternative position at the workplace, nor was she
apprised of the seriousness of the
situation.
In relation to remedy, the Board
concluded that under s. 142(2) of the Labour Relations
Code[9] it could substitute a
financial award. Section 142(2) provides:
142(2) If an arbitrator, arbitration board or other
body determines that an employee has been discharged or otherwise disciplined by
an employer for cause and the collective agreement does not contain a specific
penalty for the infraction that is the subject-matter of the arbitration, the
arbitrator, arbitration board or other body may substitute some other penalty
for the discharge or discipline that to the arbitrator, arbitration board or
other body seems just and reasonable in all the
circumstances.
The
Board considered that because of a reorganization of the workplace the
grievor’s previous position no longer existed, and it rejected the
possibility of ordering the employer to make efforts to find another position.
The Board awarded the grievor damages in the amount of four months’ salary,
having taken into consideration common law principles such as age, length of
service and the nature of the position.
Court of Queen’s Bench
The Chambers Judge dismissed the application by
AUPE and the grievor for judicial review on the preliminary argument that AUPE
and the grievor were precluded from seeking judicial review having accepted
payment of the damages.[10] The
Court of Queen’s Bench also dismissed the application for judicial review
on the basis that the applicable standard of review was reasonableness simpliciter,
and the Board’s conclusions both on its determination
of arbitral remedial authority and its exercise of that authority were
reasonable.
Court of Appeal
The Court of Appeal allowed the appeal by AUPE,
overturning the decision of the Chambers
Judge.[11] The Court of Appeal held
that the grievor had not made an election by accepting payment of the damages
ordered, on the basis that she had not clearly indicated that she had accepted
it in lieu of judicial review. In relation to standard of review, the Court
determined that the standard of correctness applied to interpretation of s.
142(2) of the Labour Relations Code while the standard of patent
unreasonableness applied to the board’s decision as to remedy. The Court
found that s. 142(2) does not apply to non-culpable behaviour, and therefore
the Board was incorrect in applying it to the circumstances of the dismissal.
In relation to the remedy ordered, the Court recognized that remedial authority
did not derive solely from the statutory grant, but also from the need for final
and binding resolution of grievances. The Court held that in circumstances such
as the dismissal in this case, a board may vary the usual remedy of reinstatement
only in exceptional circumstances. On the record, the Court was doubtful that
such a finding could be made. The Court ordered that the grievor be reinstated
and referred the quantum of back pay to the board for
determination.
Supreme Court
Some 20 days after issuing the reasons in Voice
Construction, the Supreme Court issued its decision in Lethbridge
Community College. Iacobucci J., for a unanimous Court, applied the
standard of reasonableness simpliciter both to the Board’s
interpretation of its remedial authority under s. 142(2) of the Labour
Relations Code and to its exercise of that
authority.
The Court arrived at its conclusion
that the standard of reasonableness simpliciter applied to the
Board’s interpretation of s. 142(2) of the Labour Relations Code on
the following basis:
Privative clause:
the Court noted that the relevant provisions of the Public Service Employee
Relations Act[12] and the
collective agreement did not grant full privative protection to decisions of the
arbitration board. Referring to Voice Construction, the Court considered
the “final and binding” language in the collective agreement to be
only a “limited shield against judicial review” (para. 16).
However, the Court noted that “the provisions continue to attract some
deference to the decisions of the arbitration board” (para.
16).
Expertise: the Court noted that
the “relative expertise of the board also militates in favour of some
deference” and that the Board was called upon to interpret legislation
“intimately connected with its mandate” (para.
17).
Purpose of the statutory scheme: the Court referred to the purpose of
grievance arbitration being to “secure prompt, final and binding settlement of disputes” and then
considered the purpose of s. 142(2). The Court noted that the purpose of the
provision was at once jurisdictional and remedial. The jurisdictional aspect
attracted less deference, and the remedial aspect militated in favour of greater
deference (para. 18). The Court concluded on this point “On balance, an
approach more deferential than exacting is suggested” (para.
18).
Nature of the question: the Court
characterized the issue of interpretation of s. 142(2) as a question of law.
Noting that there would be heightened precedential value of this decision, the
Court concluded that less deference was called for.
Considering all the factors, Iacobucci J.
concluded that the applicable standard for this question was
reasonableness.
In the assessment of the
functional and pragmatic factors for the issue of the exercise of remedial
authority, the Court noted that the analysis of the first three factors did not
differ from the analysis in relation to s. 142(2). On the nature of the
question, the Court characterized the Board’s decision to substitute
damages in lieu of reinstatement as a question of mixed fact and law. The Court
noted that the nature of the question called for greater deference, given its
fact intensity (para. 22). The Court concluded that after consideration of the
four factors, the applicable standard of review was reasonableness simpliciter (para. 23).
The Court
re-stated the contours of the standard of reasonableness as “fleshed
out” in Law Society of New Brunswick v.
Ryan,[13] and in Voice
Construction (para. 48):
... A decision will be unreasonable
...only if there is no line of analysis within the given
reasons that could reasonably lead the tribunal from the evidence before it to
the conclusion at which it arrived. If any of the reasons that are sufficient
to support the conclusion are tenable in the sense that they can stand up to a
somewhat probing examination, then the decision will not be unreasonable and a
reviewing court must not interfere. This means that a decision may satisfy the
reasonableness standard if it is supported by a tenable explanation even if this
explanation is not one that the reviewing court finds
compelling.
Reviewing the Court of
Appeal’s interpretation of s. 142(2), the Supreme Court considered various
factors in statutory interpretation and held that the Court of Appeal’s
interpretation had been too restrictive and had been inconsistent with the
purposes of the statute (para. 47). The Supreme Court concluded that the
Board’s interpretation was clearly reasonable (para.
48).
The Supreme Court then held that the
Board’s exercise of the remedial power was also reasonable (paras. 49,
57).
Therefore, the Court allowed the appeal
and restored the Board’s Award (para.
58).
The history of patent unreasonableness
applied to arbitrators’ interpretation and application of collective
agreements
The standard of patent
unreasonableness had been applied by the Supreme Court of Canada to
arbitrators’ interpretation and application of collective agreement
provisions for almost 25 years. The standard itself was articulated by Dickson
J. in Canadian Union of Public Employees Local 963 v. New Brunswick Liquor
Corporation,[14] a judicial
review from a labour board decision. The standard was applied to an arbitral
decision in Volvo Canada Ltd. v. U.A.W., Local
720.[15] In Alberta, the Court
of Appeal confirmed the standard for arbitral decisions in Suncor Inc. v.
McMurray Independent Oil
Workers,[16] relying on the
decision of the Supreme Court in Alberta Union of Provincial Employees,
Branch 63 v. Olds College[17] and
on the “final and binding” language in the collective agreement.
(It should be noted that in Voice Construction, Major J. referred to the “final and binding” provision
in the collective agreement, but did not analyze what effect such provision should
be given.)
The Supreme Court held to the standard
of patent unreasonableness in relation to arbitrators’ interpretation and
application of collective agreements consistently, until Voice
Construction. Decisions include:
In Dayco (Canada) Ltd. v.
CAW-Canada,[18] La Forest J.,
writing for the majority, concluded that the standard of correctness applied
in that case because the nature of the question was outside of arbitral expertise
(the question being the board’s determination of its jurisdiction and
whether retirement benefits survived the expiry of a collective agreement). La
Forest J. had also found different effect from the different wording of
privative clauses. However, La Forest J. noted that for arbitrators
interpreting within “home territory,” judicial review “must
only be to a standard of patent unreasonableness.” In separate reasons,
concurring in the result, Cory J. disagreed that there should be different
privative effect from variation in legislative language (“final and
conclusive” as compared to “final and binding”). Cory J.
stated his view that such differential approach “would defeat the aim of
the legislators who no matter what the words chosen ... were seeking to have the
courts refrain from interfering ....” The rules of judicial review
“should be simple, straightforward and easy to follow,” Justice Cory
said.
In United Brotherhood of Carpenters and
Joiners of America, Local 579 v. Bradco Construction
Ltd.,[19] the issue was
interpretation of collective agreement language addressing double-breasting.
Justice Sopinka for the majority noted that the legislative language of “final settlement” was somewhere between a full privative clause and
an appeal. However, he noted that in prior decisions, the Court had indicated
that judicial deference should be accorded to decisions of arbitrators
interpreting a collective agreement even in the absence of a privative clause.
Because the issue involved interpretation of a collective agreement provision,
and based on the purpose of the statute and the arbitrator’s relative
expertise, Sopinka J. concluded that the applicable standard was patent
unreasonableness. Cory J. in concurring reasons stated he was in substantial
agreement with Justice Sopinka. He noted in his concluding lines: “...
in Dayco, supra, my position, at least with regard to the
interpretation which should be given to privative clauses, was in the minority
and I will now loyally follow the reasoning of the majority.”
In Canada Safeway v. RWDSU, Local
454,[20] Cory J. and McLachlin
J. (as she then was), for the majority, referred to the standard of patent
unreasonableness as “well established and accepted” (para. 61) in
relation to arbitrators interpreting and applying collective agreement
provisions. (Justice L’Heureux-Dubé dissented, but not on standard
of review.)
In Parry Sound (District) Social Services
Administration Board v. O.P.S.E.U., Local
324,[21] Iacobucci J. for the
majority referred to the standard of patent unreasonableness as “well-established” in relation to arbitrators determining whether a
matter is arbitrable (para. 16). Iacobucci J. noted “This high degree of
curial deference to the decisions of arbitration boards is necessary to maintain
the integrity of the grievance arbitration process” (para. 17). (Major
J. was in dissent, but not on standard of review.) Although the standard of
correctness was held to apply to the issue of whether the substantive rights
and obligations of the Human Rights Code are incorporated into each
collective agreement, the standard of patent unreasonableness was still applied
to the over-all decision on arbitrability.
In Toronto (City) v. C.U.P.E., Local
79,[22] in an analytical
approach similar to Parry Sound, the Court (both the majority and the
concurring justices) confirmed that the standard of patent unreasonableness is
the general standard of review of an arbitrator’s decision as to whether
there has been just cause for discharge (para. 14). As in Parry Sound,
the decision contained an issue on which the arbitrator had to be correct (the
effect of a prior criminal conviction) (para. 15). However, the over-all
standard was still patent unreasonableness – with the incorrect
determination on the criminal conviction issue leading to a patently
unreasonable outcome (paras. 15, 58). Justice LeBel (for himself and Justice
Deschamps), in concurring reasons, called for a re-examination of standards of
review. This decision along with the companion decision in Ontario v.
O.P.S.E.U, [2003] 3 S.C.R. 149, were the last Supreme Court decisions on
judicial review of arbitrators prior to Voice
Construction.
In the concurring reasons in
Toronto (City) v. C.U.P.E., Local 79, Le Bel J. wrote of growing
criticism of the way in which standards of review were being articulated and
applied. In a thorough and comprehensive analysis, he examined the theory and
practical issues in the three standards of review. He noted the lack of
sufficiently clear boundaries between patent unreasonableness and reasonableness
simipliciter. He concluded with the question of whether the courts
should move to a two-standard system of judicial review: correctness and a
revised unified standard of reasonableness (para.
134).
In Voice Construction, the Court
moved to a standard of reasonableness for review of arbitrators interpreting and
applying collective agreement provisions, but the Court did not move to a
unified standard of reasonableness. Voice Construction was then relied
upon by the Court in Lethbridge Community College, which, as noted above,
applied the standard of reasonableness simpliciter to both aspects of the
case (legislative interpretation, exercise of remedial authority).
The impact of the Voice Construction
and Lethbridge Community College decisions on standard of
review
There are five reasons why it
appears that Voice Construction and Lethbridge Community College
are watersheds on standard of review for arbitrators:
1. Many other labour relations statutes do not have full
privative language.
2. The decisions in Voice Construction and
Lethbridge Community College shift the assessment of arbitrator’s
expertise.
3. The decisions in Voice Construction and
Lethbridge Community College shift the assessment of the nature of the
question.
4. From a comparison with the functional and pragmatic
analysis in other decisions, it appears that the Court has made a policy choice
in relation to arbitration.
5. Since the genesis of the reasonableness
simpliciter standard, and up until Voice Construction, the Court
has generally been applying the reasonableness simpliciter standard to
statutory appeals. Now it has made its appearance in judicial
review.
1. Other labour relations
statutes
The Court in both Voice
Construction and Lethbridge Community College found that the
governing legislation had less than full privative language. Labour relations
statutes in many jurisdictions across Canada have less than full privative
clauses in relation to arbitrators, for example:
Newfoundland and Labrador: “final
settlement” (as seen in Bradco)
Ontario: “final and binding” (as
seen in Dayco, CUPE, Local 79)
Saskatchewan: “final and
conclusive” (as seen in RWDSU)
The
Court in both decisions concluded that the less-than-privative language yielded
a conclusion of “some deference” or “not the greatest
deference.” The Court has previously focused on the effect of “less
than privative” language in other jurisdictions (Dayco,
Bradco), although in prior decisions, like Bradco, the other
factors outweighed the less-than-privative language. While the statutory
language in Alberta may be different from the “final settlement” or
“final and conclusive” or “final and binding” language
in other jurisdictions, Alberta Courts have previously found “privative
gloss” from the combined effect of the statutory language and the
“final and binding” language in collective agreements sufficient
to establish patent unreasonableness as the appropriate standard of review for
arbitral interpretation and application of collective agreement provisions
(Suncor, Mistahia Health Region v. United Nurses of Alberta, Local
64, 2003 ABCA 361, [2003] A.J. No. 1491; Foothills Provincial General
Hospital v. United Nurses of Alberta, Local 115 1998 ABCA 358, [1998] A.J.
No. 1261, leave to appeal to S.C.C. dismissed [1999] S.C.C.A. No. 31). It may
be difficult to contain the decisions on the basis that Alberta’s
statutory language is different.
2. Shift of assessment of
expertise
The Court has moved, on a general
basis, from recognition that expertise is of “utmost importance” and
mandates deference on the standard of patent unreasonableness (Bradco 1993)
to the Court now saying that it attracts “a certain degree of curial
deference.” This assessment is applied both in Voice Construction
and in Lethbridge Community College. This seems to be a qualitative
shift.
3. Shift in the nature of the
question
Prior to Voice Construction,
the Court consistently characterized the interpretation and application of
collective agreement provisions as meriting deference on the standard of patent
unreasonableness. The category was a stand-alone category. This is seen in
Dayco, Bradco, RWDSU (see para. 60), CUPE, Local 79
(see para. 14). In Dr. Q. v. College of Physicians and Surgeons of British
Columbia[23] and in Ryan,
the Court set out a template for characterization of the nature of the problem
requiring that the issue be slotted into one of the three categories: law, mixed
fact/law, fact. This appears to have pushed the Court to abandon its previous
view that interpretation and application of collective agreement provisions are
matters meriting special consideration and highest curial
deference.
The Court in Voice
Construction characterized the nature of the problem as a question of law.
It has been suggested that the particular interpretive issue before the
Arbitrator involved consideration of general principles (express vs. implied),
therefore lending itself more readily to characterization as a question of law.
But since most interpretation involves consideration and application of general
principles of interpretation (considering the agreement as a whole; different
words are to be given different meaning; determination of what is an ambiguity),
it seems that all interpretation could end up slotted as a question of
law.
In Lethbridge Community College the
shift shows up in the Court’s consideration of the board’s remedial
power. The Court characterized this as a question of “mixed fact and
law” (para. 22). The Court refers to this aspect of the decision being
afforded “deference” and “some deference.” Previously,
as can be seen in Toronto (City) Board of Education v. O.S.S.T.F., District
15,[24] the Court had applied
the standard of patent unreasonableness to arbitral exercise of remedial
power.
4. From a comparison with the functional and
pragmatic analysis in other decisions, it appears that the Court has made a
policy choice in relation to
arbitration.
It seems that the Court has
made a policy shift. If one “does the math” on the four factors
done by the Court in Voice Construction and in Lethbridge Community
College (particularly in relation to the exercise of remedial authority),
all the factors are pointing toward deference (even though qualified by phrasing
like “certain” deference or “some” deference). Yet the
outcome is the less deferential standard of reasonableness simpliciter.
In prior decisions from the Court, where the four factors were pointing to
deference the outcome was the standard of patent unreasonableness (for example,
RWDSU).
It is interesting to compare the
evaluation of the functional and pragmatic factors in Voice Construction
and Lethbridge Community College with the evaluation in Dr. Q. In
Voice Construction and Lethbridge Community College, although all
four factors pointed toward deference, the outcome was reasonableness
simpliciter. In Dr. Q there was a statutory right of
appeal, expertise was found to be low, and the purpose of the
statute was found to be neutral. The last factor, nature of the
question, involved a finding of credibility, which the Court considered to be “quintessentially [a question] of fact” and
meriting respect by the Court. So, in Dr. Q., three out of four factors pointed to little
deference, and the one factor of nature of the problem shifted the standard to
reasonableness. In Voice Construction, three out of the four factors
(and maybe even four out of four) pointed to deference, and the resulting
standard was the same as in Dr. Q.
The
Supreme Court had said that there should be “no retreat” from the
highest curial deference to arbitrators acting within jurisdiction (Toronto
(City) Board of Education v. O.S.S.T.F., District 15, para. 37). It appears
the decision has been made to retreat. The shock waves from Alberta may well
extend across Canada.
5. The application of reasonableness
simpliciter to judicial review
The
standard of reasonableness simpliciter had its genesis in a situation
where the legislation provided for appeal, but the Court was of the view that
the tribunal had greater relative expertise as compared to the Courts. This was
in Canada (Director of Investigation and Research) v. Southam
Inc.,[25] dealing with the
Competition Tribunal. Reasonableness simpliciter was then applied in
further cases of statutory appeals: Dr. Q., Ryan, Cartaway
Resources Corp. (Re).[26] Now
we are seeing it in judicial review, in relation to matters “within
home territory.” This is a significant
leap.
Is less deference a likely result?
What is the impact?
Justices LeBel and
Deschamps asked in CUPE, Local 79 whether the Courts should move to a
two-standard system of judicial review: correctness and a revised unified
standard of reasonableness (para. 134). The Court in Voice Construction
moved to the standard of reasonableness simpliciter from the standard of
patent unreasonableness, without shifting to the unified standard proposed by
Justices LeBel and Deschamps. This still leaves three standards applicable to
tribunals, and reasonableness simpliciter is, according to the Court in
Voice Construction and Lethbridge Community College, a less
deferential standard than patent unreasonableness (Voice Construction,
para. 22). This can only be taken by Courts as a go-ahead signal. Less
deference by the courts is the likely result. Chambers Judges who have
decisions on reserve have written to counsel seeking their submissions on the
effect of the decisions. Supplementary factums are being filed on
appeals.
Back in 1980, Justice Pigeon said (in
Volvo Canada Ltd.) that arbitration is not meant to be an additional step
before the matter goes to court. The current developments encourage exactly
that. It is likely that the decisions in Voice Construction and
Lethbridge Community College will encourage the losing party to apply for
judicial review. The lower Courts have been given permission to be more
interventionist. Is this good for unions? If the grievance has been denied,
the union may benefit from a more interventionist court. The question remains
as to (a) union rate of success before arbitrators and (b) union rate of success
in seeking judicial reviews. However, it is clear that increasing recourse to
the Courts means more resources being spent on litigation. It also means that
the final answer is delayed. Unions and union-side counsel will have to look at
the practicalities of the issue.
What should unions and union-side
lawyers do?
In CUPE, Local 79, Justice Arbour, for the
majority, declined to consider a change to the entire approach to judicial
review since the issue had not been argued before the court. Justice Arbour
observed that “without the benefit of a full adversarial debate, I would
not wish to comment on the desirability of a departure from our recently
affirmed framework for standards of review analysis” (para. 12). Justice
LeBel was of the view that “the task of maintaining a predictable,
workable and coherent jurisprudence falls primarily on the judiciary, preferable
with, but exceptionally without, the benefit of counsel” (para. 64).
Justice Le Bel noted that his analysis in that case did not prejudice the
parties (para. 64). While Justice Le Bel did discuss the issue of standard of
review comprehensively, his concurring reasons concluded with a question. The
applicable standard was not changed.
In
Voice Construction Ltd., there had not been full adversarial debate on
the issue of whether the standard of reasonableness simpliciter should
apply. The issue in the case and in the Courts below was whether the standard
of correctness or the standard of patent unreasonableness
applied.
It would seem important for the Court
to hear the full adversarial debate on this issue from opposing parties.
Further, the Court would benefit from the input of interveners. Both the
parties and the interveners could address the theoretical impact and practical
impact of a change of the standard of review applicable to arbitrators
interpreting and applying the standard of review. It is to be hoped that there
will be an opportunity in the near future for unions to address the full issue
before the Supreme Court – either as parties or as
interveners.
[1]
2004 SCC
23
[2]
2004 SCC
28
[3]
[2000] A.G.A.A. No.
88
[4]
[2001] A.J. No. 488
(Q.B.)
[5]
[2002] A.J. No. 1413
(C.A.)
[6]
[1999] A.G.A.A. No.
103
[7]
(1982), 6 L.A.C. (3d) 229
(B.C.)
[8]
Supreme Court decision, para.
5
[9]
R.S.A. 2000, c.
L-1
[10]
[2000] A.J. No. 1583
(Q.B.)
[11]
[2002] A.J. No. 695
(C.A.)
[12]
R.S.A. 2000, c.
P-43
[13]
[2003] 1 S.C.R.
247
[14]
[1979] 2 S.C.R.
227
[15]
[1980] 1 S.C.R.
178
[16]
(1982), 23 Alta. L.R. (2d) 105
(C.A.)
[17]
[1982] 1 S.C.R.
923
[18]
[1993] 2 S.C.R.
230
[19]
[1993] 2 S.C.R.
316
[20]
[1998] 1 S.C.R.
1079
[21]
[2003] S.C.R.
157
[22]
[2003] 3 S.C.R.
77
[23]
[2003] 1 S.C.R.
226
[24]
[1997] 1 S.C.R.
487
[25]
[1997] 1 S.C.R.
748
[26]
2004 SCC 26
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