A-589-03
2004 FCA 365
TELUS Communications Inc. (Appellant)
v.
The Canadian Radio-television and Telecommunications Commission, Delta Cable Communications Ltd., on behalf of itself and Coast Cable Communications Ltd., The Canadian Cable Television Association, and Shaw Communications Inc. (Respondents)
Indexed as: TELUS Communications Inc. v. Canada (Radio-television and Telecommunications Commission) (F.C.A.)
Federal Court of Appeal, Décary, Létourneau and Nadon JJ.A.--Ottawa, October 12 and 27, 2004.
Telecommunications -- Whether CRTC decision illegal as retroactive rate setting -- Rates for certain conduit types owned by TELUS, used as support structure for cable T.V., Internet wires -- History of rate setting reviewed -- Impugned decision varied previous order eliminating distinct rates for different conduit types, introducing common monthly rate -- Restored status quo ante -- Earlier decision dealt with numerous difficult issues -- Elimination of distinct rates for TELUS conduit perhaps done inadvertently -- Had CRTC intended such important change, would have given reasons for decision instead of Order's terse wording -- CRTC correct in entertaining objection made outside usual six-month deadline as circumstances exceptional, not demonstrated uniform rate "just and reasonable" as required by Telecommunciations Act, s. 27 -- CRTC not having fixed rates retroactively -- Had previously exceeded jurisdiction in making order unsupported by any evidence -- Act, s. 62 empowered CRTC to reconsider previous decisions -- CRTC having statutory duty to ensure rates just, reasonable -- Can admit earlier decision nullity, adopt corrective measures -- Discretionary power under s. 32(d), (e), (f) to suspend, disallow portion of tariff considered inconsistent with s. 27 -- Unjust, unreasonable rates compromise Act's objective of reliable, affordable telecommunications -- No denial of procedural fairness.
Administrative Law -- Statutory Appeals -- Whether Canadian Radio-television and Telecommunications Commission decision illegal retroactive rate setting -- CRTC had not fixed rates retroactively -- Set aside portion of earlier decision which exceeded jurisdiction as rendered in absence of any supporting evidence -- Courts having "quietly abandoned" law that tribunal does not exceed jurisdiction in basing decision on finding of fact unsupported by evidence -- "No evidence" elevated to independent ground of review having essential characteristics of jurisdictional error -- Judicial review in such case not ousted by preclusive clause -- Such decision is nullity, reviewable as arbitrary -- Tribunals may have implied power to reconsider to discharge statutory duties -- In instant case, such power expressly conferred by statute -- CRTC given broad discretionary powers to further objectives of legislation -- No denial of procedural fairness as appellant afforded chance to argue retroactivity issue -- In circumstances, CRTC correct in entertaining objection made outside normal limitation period.
The issue upon this appeal was whether Telecom Decision CRTC 2003-54 was illegal as retroactive rate setting or merely the restoration of the status quo ante of rates applicable to certain conduit types owned by TELUS Communications, the appellant? A conduit is a support structure for wires which deliver cable television and high-speed Internet services to subscribers. Appellant argued that even if not illegal, the decision was still unreasonable and that appellant had been denied procedural fairness. Finally, it submitted that the CRTC improperly exercised its discretion in permitting a challenge to Order CRTC 2000-13 almost two years after it was made.
TELUS, successor to BC TEL, is an Incumbent Local Exchange Carrier while respondents, Delta, Coast Cable and Shaw, are cable companies which utilize TELUS conduit for their cable infrastructure. Between 1978 and 1983, the CRTC had approved rates for four types of conduit (Type A to D, according to who paid for the installation) provided by BC TEL. In 1994, following a review of the use and costs sharing of telephone company structures, the CRTC approved interim rates for Type B to D and in 1995 it approved a uniform national monthly rate for conduit. But, because BC TEL had more than one type of conduit, the CRTC indicated the uniform rate would apply only to its Type A conduit and directed BC Tel to make specific submissions covering the other three types. Instead, BC Tel issued Tariff Notice 3336 asking for the elimination of the distinction between conduit types and that all of its conduit come under the uniform national rate. The Canadian Cable Television Association (CCTA) objected, its view being that BC TEL should not be permitted to charge as much for conduit obtained free of charge from a developer as for conduit installed at its own expense. Eventually, in 2000, the CRTC allowed the withdrawal of distinct rates for Type B to D conduit. Shaw Communications complained and CRTC staff sought a negotiated resolution to avoid the necessity for further formal CRTC intervention. When this did not work out, Shaw filed a Part VII application under the CRTC Telecommunications Rules of Procedure requesting that the CRTC initiate a proceeding to consider Type B to D conduit access rates. In addition, it asked that rates approved in 1995 on a final basis for Types B-D conduit be made interim pending outcome of the proceeding. In its letter of intervention, the CCTA suggested that if Order 2000-13 had actually eliminated the distinction among conduit types and rates, the CRTC should exercise its Act, section 62 discretion to review that decision. Under that section, the Commission is empowered to review, rescind or vary any decision that it has made.
By Telecom Decision CRTC 2003-54 (that under appeal), the Commission varied that part of Order 2000-13 which had eliminated the distinct rates for TELUS' Type A to D conduit and introduced a $2.25-per-30-metres monthly rate for all of TELUS' conduit. The Order restored the definitions and distinct rates in place prior to the earlier decision. The restoration was retroactive to February 17, 2000. The earlier decision involved issues that were wide-ranging, difficult and controversial; those involving the TELUS conduit were a mere drop in the bucket. In that context, the respondents suggested that if that Order did eliminate the distinct rates for TELUS conduit, it did so through inadvertence.
The CRTC agreed with appellant's interpretation of Order 2000-13, i.e. that it had the effect of approving the withdrawal of distinct rates while introducing a uniform monthly rate. The Court's view was that Type B to D conduit got caught by inadvertence, the intention in issuing the Order having been to deal only with Type A conduit. The provision in the Order at issue was tersely worded and contained no explanation or justification for such a substantial change. Had the Commission intended to make a change of this importance, it would have given reasons for such decision. The issue of rates for Type B to D conduit had fallen between the cracks, only to come to light when respondents realized the Order's potential impact and drew the matter to the Commission's attention.
In Telecom Decision CRTC 2003-54, the Commission reviewed the history of appellant's conduit rate approvals and stressed the point that, by Order CRTC 96-1484 it had put on hold TELUS' request for a uniform rate pending consideration of the different costs associated with Type B to D conduit. The Commission was satisfied that there existed exceptional circumstances and valid reasons for Shaw's delay in filing its Part VII application and that this justified a departure from its policy that an application to vary under Act, section 62, should be brought within six months of the impugned decision. In fact, within just 15 days of the decision, Shaw had given the CRTC notice of its concerns but while discussions initiated by the CRTC took place in an attempt to resolve the problem delayed the filing of the an application .
Following its review of the earlier decisions, the Commission determined that there existed substantial doubt as to the correctness of the Order and that, as far as Type B to D conduit were concerned, Order 2000-13 should be varied. It had not been demonstrated that the uniform rate would be "just and reasonable" as required by Act, section 27. The Commission wrote that, while adhering to its position that "as a matter of regulatory policy rates approved on a final basis should not generally be subject to adjustment", in the instant case failure to make an exception would result in an injustice to applicants.
Held, the appeal should be dismissed.
In support of its submission that the CRTC lacked jurisdiction to vary a rate finally approved, let alone to do so retroactively, appellant referred to Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission). But that case stands for the proposition that interim rates may be varied retroactively or retrospectively. Appellant was mistaken in supposing that the CRTC had fixed rates retroactively. What it did was to vary its decision by setting aside that part of it which had been rendered in the absence of any supporting evidence, thereby exceeding jurisdiction and violating its statutory duties. It restored the status quo ante. There was no rate setting by Telecom Decision CRTC 2003-54. Brown and Evans, in their work Judicial Review of Administrative Action in Canada, explain that, over the last quarter century, courts have "quietly abandoned" the earlier law that a tribunal does not exceed jurisdiction by basing a decision on a finding of fact unsupported by any evidence. "No evidence" has been elevated to an independent ground of review having the essential characteristics of jurisdictional error. Judicial review in such case is not subject to ouster by a preclusive clause. A decision made in the absence of evidence is a nullity and is reviewable as arbitrary according to Estey J. in Douglas Aircraft Co. of Canada v. McConnell et al. There is both Supreme Court of Canada and High Court of Australia authority for the proposition that administrative tribunals may possess implied powers of reconsideration to enable the discharge of their duties under their enabling legislation. But, in the case at bar, such power was expressly conferred by section 62 of the Act.
Furthermore, Act section 27 provides that rates charged must be "just and reasonable". The CRTC is under a statutory duty to ensure that this requirement is met at all times: Act, section 47. There is no doubting that the Commission is empowered to acknowledge that an earlier decision is a nullity and to undertake appropriate corrective measures. In addition, paragraphs 32(d), (e) and (f) confer a broad discretionary power to suspend or disallow any portion of a tariff that the CRTC considers to be inconsistent with section 27. These duties and powers were intended to further the objectives of the legislation: to render reliable and affordable telecommunications services of high quality as well as to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications and also to respond to the economic and social requirements of users. Unjust, unreasonable rates compromise the accessibility of affordable services while being unresponsive to users' economic requirements.
In view of the Court's conclusion that the CRTC had not engaged in retroactive rate setting, it was unnecessary to canvass the issue of whether section 62 gives it power to do so. Furthermore, appellant had been given ample opportunity to argue the retroactivity issue and there had been no denial of procedural fairness.
Nor was there merit in the argument that the Commission had improperly exercised its discretion in entertaining a challenge that was out of time. Why should a direct attack be barred by a limitation period when a collateral attack might be allowed against the part of Order 2000-13 made without jurisdiction?
statutes and regulations judicially
considered
Architects Act, R.S.A. 1980, c. A-44.1.
| CRTC Telecommunications Rules of Procedure, SOR/79-554, Part VII. |
| Telecommunications Act, S.C. 1993, c. 38, ss. 7(b),(c),(h), 27, 32(d),(e),(f),(g), 47, 62. |
cases judicially considered
applied:
Douglas Aircraft Co. of Canada Ltd. v. McConnell et al., [1980] 1 S.C.R. 245; (1979), 99 D.L.R. (3d) 385; 79 CLLC 14,221; 29 N.R. 109;Chandler v. Alberta Association of Architects, [1989] 2 S.C.R. 848; (1989), 101 A.R. 321; 62 D.L.R. (4th) 577; [1989] 6 W.W.R. 521; 70 Alta. L.R. (2d) 193; 40 Admin. L.R. 128; 36 C.L.R. 1; 99 N.R. 277; revg (1985), 67 A.R. 255 (C.A.); Minister for Immigration and Multicultural Affairs v. Bhardwaj (2002), 187 ALR 117; [2002] HCA 11.
distinguished:
Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission), [1989] 1 S.C.R. 1722; (1989), 60 D.L.R. (4th) 682; 38 Admin. L.R. 1; 97 N.R. 15.
referred to:
Rates Set for Access to Telephone Companies' Support Structures, Order CRTC 2000-13; BC TEL (Re), Telecom Order CRTC 94-996; Access to Telephone Company Support Structure, Telecom Decision CRTC 95-13; In the Matter of the Implementation of Access to Telephone Company Support Structures, Telecom Decision CRTC 95-13, 22 June 1995 (Decision 95-13), Telecom Order CRTC 96-1484; R. v. Litchfield, [1993] 4 S.C.R. 333; (1993), 145 A.R. 321; 14 Alta. L.R. (3d) 1; 86 C.C.C. (3d) 97; 25 C.R. (4th) 137; 161 N.R. 161; Dagenais v. Canadian Broadcasting Corp., [1994] 3 S.C.R. 835; (1994), 120 D.L.R. (4th) 12; 94 C.C.C. (3d) 289; 34 C.R. (4th) 269; 25 C.R.R. (2d) 1; 175 N.R. 1; 76 O.A.C. 81.
authors cited
Brown, J. M. and John M. Evans. Judicial Review of Administrative Action in Canada, looseleaf. Toronto: Canvasback, 1998.
Guidelines for Review and Vary Applications, Telecom Public Notice CRTC 98-6. Ottawa, March 20, 1998.
APPEAL against a CRTC decision (Part VII Application by Shaw Communications Inc. Requesting a Proceeding to Consider the Rates for Type B, C and D Conduit Provided by TELUS Communications Inc., Telecom Decision CRTC 2003-54) as an illegal exercise in retroactive rate setting. Appeal dismissed.
appearances:
John F. Rook, Q.C., John E. Lowe and Stephen Schmidt for appellant.
James D. Wilson for respondent The Canadian Radio-television and Telecommunications Commission.
Lori Assheton-Smith and Gerald L. Kerr-Wilson for respondent The Canadian Cable Television Association.
C. Christopher Johnston, Q.C. and Leslie J. F. Milton for respondents Delta Cable Communications Ltd., Coast Cable Communications Ltd. and Shaw Communications Inc.
solicitors of record:
Bennett Jones LLP, Calgary, for appellant.
The Canadian Radio-television and Telecommuni-cations Commission, Gatineau, for respondent The Canadian Radio-television and Telecommunications Commission.
Canadian Cable Television Association, Ottawa, for respondent The Canadian Cable Television Association.
Johnston & Buchan LLP , Ottawa, for respondents Delta Cable Communications Ltd., Coast Cable Communications Ltd. and Shaw Communications Inc.
The following are the reasons for judgment rendered in English by
[1]Létourneau J.A.: Was Telecom Decision CRTC 2003-54 [Part VII Application by Shaw Communications Inc. Requesting a Proceeding to Consider the Rates for Type B, C and D Conduct Provided by TELUS Communications Inc.] an illegal exercise in retroactive rate setting as contended by the appellant or was it rather, as the respondents, Delta Cable Communications Ltd. (Delta) and the Canadian Cable Television Association (CCTA) submit, simply a restoration of the status quo ante with respect to rates applicable to Type B, C and D conduit owned by the appellant? A conduit is a type of support structure designed to house and support the wires and other infrastructures used to deliver cable television, high-speed Internet access and other telecommunications services to subscribers. In a nutshell, a conduit is a "reinforced passage or opening in, on, over or through the ground or watercourses capable of containing communications facilities": see paragraph 12 of the Telecom Decision CRTC 2003-54.
[2]The appellant also avers that the decision of the Canadian Radio-television and Telecommunications Commission (CRTC), if found to be legal, is unreasonable in the circumstances. It also complains that it was the victim of procedural unfairness in that it was not given the opportunity to make full and appropriate submissions on the issue of retroactivity. Finally, the appellant submits that the CRTC improperly exercised its discretion in allowing Delta and the CCTA to make an application to challenge its Order CRTC 2000-13 [Rates Set for Access to Telephone Companies' Support Structures (Order 2000-13)] almost two years after the order was rendered.
Facts and procedure
[3]The process of determining just and reasonable rates for Type B, C and D conduit owned by the appellant is rich in history and longstanding debates as the facts and these proceedings demonstrate.
[4]The appellant, TELUS Communications Inc. (TELUS), is an Incumbent Local Exchange Carrier (ILEC) and is the successor company to BC TEL. The respondents, Delta, Coast Cable Communications Ltd. (Coast) and Shaw Communications Ltd. (Shaw), are cable companies that use conduit provided by TELUS to support their cable infrastructure. The CCTA is a national organization that represents cable companies: as of September 21, 2004, the CCTA has renamed itself the Canadian Cable Telecommunications Association.
[5]Between 1978 and 1983, the CRTC approved different rates for four types of conduit provided by BC TEL (Type A to D conduit). Unlike other telephone companies, which offered one type of conduit access, BC TEL offered four kinds, which were distinguishable on the basis of who paid the embedded costs for the supply and installation of the conduit. It is not disputed that the four types of conduit were thus defined:
| Type A: Conduit supplied, installed, owned and maintained entirely by and at the expense of BC TEL. |
| Type B: Conduit supplied, owned, and maintained by and at the expense of BC TEL, but installed by BC TEL at the expense of the developer. |
| Type C: Conduit owned and maintained by and at the expense of BC TEL, but supplied and installed by BC TEL at the expense of the developer (applied only in the area formerly served by the Okanagan Telephone Company). |
| Type D: Conduit owned and maintained by BC TEL, but supplied and installed by and at the expense of the developer. |
[6]In 1993, the CRTC initiated a review of the use and sharing of costs of telephone company structures. In 1994, it approved interim rates for Type B to D conduit for BC TEL (Telecom Order CRTC 94-996) [BC TEL (Re)]. As a result of the review, in 1995, the CRTC set out basic principles regarding access to support structures and approved a uniform national monthly rate for conduit. It also directed telephone companies to issue tariff pages implementing the Telecom Decision CRTC 95-13 [Access to Telephone Company Support Structure].
[7]Because BC TEL was in the unusual situation of having more than one type of conduit, the CRTC indicated that the uniform rate would only apply to its Type A conduit and directed BC TEL to make specific submissions regarding other conduit types. In the meantime, in Telecom Decision CRTC 95-13 it also granted final approval to the monthly rates it had approved for Type B to D on an interim basis in Telecom Order CRTC 94-996.
[8]BC TEL's response to the CRTC's request for further submissions was Tariff Notice 3336 (TN 3336), in which it asked that the distinction among conduit types be eliminated and that all of its conduits be brought under the uniform national rate.
[9]In Telecom Order CRTC 96-1484 [In the Matter of the Implementation of Access to Telephone Company Support Structures, Telecom Decision CRTC 95-13, 22 June 1995 (Decision 95-13)], the CRTC deferred disposition of TN 3336, indicating that an investigation of the current demand for and circumstances associated with Type B to D conduit was required prior to making a decision. Indeed, the CCTA objected to BC TEL's statement that costs were no longer a material consideration in setting rates. It submitted that BC TEL should not be allowed to charge the same amount for conduit that it gets free from a developer as it does for conduit that it pays for and installs itself: see page 2 of Telecom Order CRTC 96-1484. The CRTC deferred its disposition of BC TEL's Tariff Notice 3336 because it was of the view that the uniform rate proposed by BC TEL might not be appropriate: see Telecom Order, at page 3.
[10]At the same time, the CRTC also established a consultative process led by Stentor Resource Centre Inc. (Stentor) in which telephone companies and cable companies would develop a mutually acceptable model Support Structure Agreement (SSA) and a model support structure tariff.
[11]In 1997, Stentor filed a joint report as a result of this process, which included a model National Services Tariff (NST) and model SSA. The model NST included the uniform national monthly rate already approved in Telecom Decision CRTC 95-13. It also included distinct definitions and different rates for Type B to D conduit for BC TEL. These rates and definitions were, in fact, also those approved by the CRTC in its Telecom Decision 95-13: see page 105 of the Appeal Book.
[12]In TN 485, Stentor proposed a NST and related SSA that would migrate support structure services from the telephone companies' tariffs to the national services tariff. There was, however, no inclusion of definitions or rates for Type B to D conduit despite their inclusion in the model tariff that had been submitted in the joint report.
[13]In June 1997, BC TEL submitted for approval Tariff Notice 3637 (TN 3637), in which it asked the CRTC to subsume the deferred decision-making process relating to TN 3336 into its current consideration of Stentor's TN 485. It also asked that the distinction among its types of conduit both in terms of definitions and rates be eliminated and that all of its conduit be brought under the national uniform rate effective the date of approval of TN 485: see Appeal Book, at pages 166-167.
[14]In Order 2000-13, the CRTC approved the NST and the SSA proposed by Stentor. It also approved BC TEL's TN 3637, thereby allowing, as we shall see, the withdrawal of distinct rates for Type B to D conduit. These changes took effect on February 17, 2000.
[15]Within 15 days of the decision, Shaw contacted the CRTC to express its concerns about the withdrawal of the distinct rates for Type B to D conduit. The CRTC's staff initiated discussions among the parties, seeking a negotiated resolution without the need for more formal CRTC intervention. This process eventually proved unsuccessful.
[16]On December 20, 2001, Shaw filed, pursuant to the CRTC Telecommunications Rules of Procedure [SOR/79-554], a Part VII application requesting that the CRTC initiate a proceeding to consider rates for access to Type B to D conduit, arguing that the issue had been outstanding since Telecom Decision CRTC 95-13 and that Order 2000-13 was only intended to cover Type A conduit for TELUS (formerly BC TEL). It further asked that the CRTC make the rates approved on a final basis in 1995 for Type B to D conduit interim pending the outcome of such a proceeding.
[17]The CRTC received comments on Shaw's application from TELUS as well as from Delta (on behalf of itself and Coast) and the CCTA. In its letter of intervention, although it agreed with Shaw's interpretation of Order 2000-13, the CCTA suggested, in the alternative, that if Order 2000-13 had really eliminated the distinction among conduit types and rates, this was an occasion for the CRTC to exercise its discretion under section 62 of the Telecommunications Act, S.C. 1993, c. 38 (Act) to review that decision. Section 62 gives the CRTC, even on its own motion, the power to review, rescind or vary any decision that it makes.
62. The Commission may, on application or on its own motion, review and rescind or vary any decision made by it or re-hear a matter before rendering a decision. [Emphasis added.]
[18]TELUS' comments in response to Shaw's application were filed on January 21, 2002. Shaw's reply to TELUS' response came on February 11, 2002. On January 31, 2002, TELUS filed its reply to the CCTA's intervention.
[19]On August 13, 2003, the CRTC issued Telecom Decision CRTC 2003-54 (the decision under appeal), in which it varied that part of its decision in Order 2000-13 which had approved TELUS' TN 3637, eliminated the definitions and distinct rates for TELUS' Type A, B, C and D conduit and introduced a uniform definition and a monthly rate of $2.25 per 30 metres for all of TELUS' conduit. That part of the Order was varied "so as to restore the definitions and distinct rates that were in place prior to that decision" (emphasis added): see paragraph 54 of Telecom Decision CRTC 2003-54. The restoration of the prior definitions and rates was made effective February 17, 2000, the date the withdrawal of the rates contained in Telecom Decision CRTC 95-13 had originally taken effect.
[20]On November 6, 2003, TELUS was granted, by this Court, leave to appeal against Telecom Decision CRTC 2003-54. Before turning my attention to that decision, I will say a word about Order CRTC 2000-13 which eliminated the distinct definitions and rates for TELUS' Type B, C and D conduit.
Rates set for access to telephone companies' support structures, Order CRTC 2000-13, 18 January 2000
[21]The CRTC's decision in Order 2000-13 is quite lengthy. It contains 256 paragraphs. Put in general terms, it addresses the issues of national rates, terms and conditions for access to incumbent telephone companies' poles and conduit by cable companies and telecommunications carriers. It also deals with issues of support structure capacity, application of construction standards and the access approval process. Furthermore, it considers the joint report filed in 1997 by Stentor.
[22]More specifically, the decision rules on the definition of conduit, a person duly authorized to bind a licensee, support structures and spare capacity for future service requirements. It discusses various non-recurring charges resulting from unauthorized attachment, late notification, search, make-ready (costs incurred when work is needed to make spare capacity available) and inspection, monthly rates for recurring charges, the use of a conduit on private property, the obligation to carry insurance to cover legal liabilities, the conditions for terminating an agreement or a permit, the removal of an unauthorized presence on a licensee's facilities, the proposed dispute resolution process, the survival of the SSA terms and conditions beyond termination of the SSA, waiver of SSA conditions, the legal status of agreements prior to SSA, the severability of SSA provisions if some are declared invalid or unenforceable and, finally, the scope of confidentiality provisions with respect to information regarding licensees and companies.
[23]I have listed these topics to highlight the wide range of matters confronting the CRTC on that occasion. The questions relating to Type B to D conduit, peculiar as they were and limited in their application to TELUS, appear as a small drop in this sea of difficult and controversial issues. It is against this background that the respondents allege that if Order 2000-13 did eliminate the distinct rates applicable to TELUS' Type B to D conduit, it did so either erroneously or by inadvertence. What was the effect of that Order? Was this effect intended or was it the result of an oversight?
Effect of Order CRTC 2000-13 regarding TELUS' Type A, B, C and D conduit
[24]The CRTC agreed with the appellant's interpretation of Order 2000-13, namely that the Order had the effect of approving the withdrawal of the distinct rates for Type A, B, C and D conduit and applying a uniform monthly rate of $2.25 per 30 metres for all of TELUS' conduits: see paragraph 38 of the Telecom Decision CRTC 2003-54. I think, however, that it is reasonable to infer that Order 2000-13 intended to deal solely with Type A conduit and establish a uniform rate applicable to this type of conduit alone. I agree with the respondents that Type B to D conduit "got caught" by Order 2000-13 either by mistake or inadvertence. The reasonableness of the inference stems from a number of facts.
[25]First, Stentor's joint report maintained the distinct definitions and rates for Type A, B, C and D conduit, distinctions which were meant to reflect the embedded costs and the influence they had on the levels of rates.
[26]Second, Stentor was aware that TELUS' request for the elimination of the distinct definitions and rates for its Type A, B, C and D conduit had been put on hold, an investigation of the matter had been found appropriate, additional information was needed and the issue was therefore still pending before the CRTC. This is why Stentor's proposal in TN 485 for a uniform rate did not include Type B to D conduit which, of all carriers, TELUS was the only one to possess.
[27]Third, all carriers, including TELUS, had Type A conduit. It was, therefore, appropriate for the CRTC to include TELUS in its decision so as to make the uniform national rate accepted for Type A conduit applicable to the Type A conduit owned by TELUS.
[28]Fourth, the CRTC had already expressed its views that the uniform rate proposed by TELUS might not be appropriate, given the respondents' strong opposition based on the fact that different costs were incurred by TELUS. One would have expected the CRTC to discuss and rule on the respondents' position if it intended to eliminate the distinct definitions and rates for TELUS' Type A, B, C and D conduit. Nowhere in Order 2000-13 is there any explanation or justification for the substantial change which occurred as a result of the following tersely worded paragraph:
The Commission approves the following TNs for withdrawal of support structure tariffs effective coincident with the date at which the tariff pages issued pursuant to this order will come into effect:
Bell TN 6022
BC TEL TN 3637
NB Tel TN 647
MTS TN 278
[29]This fundamental change was effected by merely inserting BC TEL TN 3637 in the above list found at paragraph 21 of the Order. This is inconsistent with Telecom Decision CRTC 95-13 which made final the approval of rates for TELUS' Type B to D conduit and with Telecom Order CRTC 96-1484 which had deferred ruling on TELUS' request to eliminate distinct rates, indicating that further investigation was appropriate prior to making a decision on the request. The only paragraph which might suggest that the CRTC considered the question of Type B to D conduit is paragraph 16 of Order 2000-13 where the CRTC ruled that it was not premature to address the issues raised in the proposed tariffs and SSAs. However, this finding does not deal with the question of the distinct definitions and rates for Type B to D conduit because these types were left out of the tariffs and SSAs proposed by Stentor and by the other companies which did not have these types of conduit. I have no doubt that had the CRTC really intended to make a change of this nature and importance for conduit and telecommunications users, it would have provided some reasons for its decision.
[30]In the end, on the basis of the evidence in the record, I believe that it was not the CRTC's intent in its Order 2000-13 to eliminate the distinct definitions and rates for Type B to D conduit owned by the appellant and that this question "fell between the cracks" until the respondents realized the potential effect and impact of the Order and brought it to the attention of the CRTC. Whether the change brought about by Order 2000-13 to Type B to D conduit was the result of an error or an oversight does not really matter as we shall see below. I now turn to a summary of Telecom Decision CRTC 2003-54 and to an analysis of that decision and of the parties' submissions.
Telecom Decision CRTC 2003-54
[31]In this decision, the CRTC reviews the history of the approval of different rates for Type A, B, C and D conduit owned by the appellant. It reiterates that, in Telecom Decision CRTC 95-13, it had noted the different rates for the appellant's various types of conduit and granted final approval for the rates that had been granted interim approval in 1994. It also underlines the fact that, in Telecom Order CRTC 96-1484, it put TELUS' request for a uniform rate as proposed in TN 3336 on hold until appropriate investigation could be made of the request in view of the different costs associated with Type B to D conduit: see paragraphs 6, 7 and 8 of the decision. It then proceeded to consider the appellant's objections to the Part VII application by Shaw and to the CCTA's intervention.
| (a) The time frame for filing the application |
[32]Notwithstanding the objection of the appellant, the CRTC was satisfied that there were exceptional circumstances in this case and valid reasons for the delay in filing the Part VII application which justified a derogation from its general policy that an application to vary or rescind, made pursuant to section 62 of the Act, should normally be brought within 6 months of the decision that the party seeks to have reviewed.
[33]Within 15 days of the release of Order 2000-13, Shaw had notified the CRTC of its concerns regarding the elimination of the distinction among types of conduit. It had also notified the appellant in May 2000 of these concerns. The CRTC had initiated discussions among the parties (in which it had participated), in an attempt to solve the problem, but these had proven unsuccessful and delayed the filing of the application.
| (b) The existence of substantial doubt as to the correctness of approving the withdrawal of distinct rates for Type A, B, C and D conduit |
[34]In the Telecom Public Notice CRTC 98-6 [Guidelines for Review and Vary Applications] that it gave, the CRTC indicated that it would exercise its jurisdiction, pursuant to section 62 of the Act, to review and vary its Order 2000-13 if there was substantial doubt as to the correctness of that Order. After a review of its earlier decisions and proceedings regarding this matter, it concluded that such doubt had been established and that it was appropriate to vary Order 2000-13 as far as Type B to D conduit was concerned.
[35]In support of its decision to vary its earlier Order, the CRTC relied on the following facts: it was not satisfied that costs were no longer a material consideration with respect to the appropriate rates for Type B to D conduit, neither Stentor nor TELUS, as specifically requested, had provided any new evidence or argument in favour of the elimination of the distinctions between these types of conduit and there was, with respect to this issue, no evidence on the record of the proceeding leading to Order 2000-13. It also took into account the fact that no prejudice would result to the appellant if Order 2000-13 were varied because the rates authorized by that Order had never been implemented by the appellant. Conversely, Shaw, Delta and Coast would be subject to substantial increases in their operating costs if the uniform rates authorized by Order 2000-13 were implemented. In these circumstances, especially in view of a lack of information and evidence justifying the elimination of the definitions and distinct rates for the appellant's Type B to D conduit, it was never demonstrated that the uniform rate would be "just and reasonable" as required by section 27 of the Act:
27. (1) Every rate charged by a Canadian carrier for a telecommunications service shall be just and reasonable.
(2) No Canadian carrier shall, in relation to the provision of a telecommunications service or the charging of a rate for it, unjustly discriminate or give an undue or unreasonable preference toward any person, including itself, or subject any person to an undue or unreasonable disadvantage.
(3) The Commission may determine in any case, as a question of fact, whether a Canadian carrier has complied with section 25, this section or section 29, or with any decision made under section 24, 25, 29, 34 or 40.
[36]I reproduce key paragraphs (45-49, 53) of the decision leading to the CRTC's conclusion as well as paragraph 54 which contains that conclusion:
In Order 96-1484 the Commission indicated it was not satisfied by BC TEL's argument that costs were no longer a material consideration with respect to the appropriate rates for Type B, C and D conduit, and determined that it would be appropriate to investigate the demand for Type B, C and D conduit and the specific circumstances under which Type was provisioned, before considering the company's request that there be a uniform rate for all of its conduit.
The Commission notes that Stentor, in asking the Commission to bring the issue of rates for BC TEL's B, C and D conduit into the scope of the proceeding to consider TN 485, did not provide any new evidence or argument in favour of the elimination of the various types of conduit. Moreover, although the Commission had determined that, in considering the appropriate rates for Type B, C and D conduit, it would be appropriate to investigate the demand and the specific provisioning circumstances for each type, neither Stentor nor BC TEL provided any such information, nor did it form part of the record of the proceeding leading to Order 2000-13. The distinct rates for Type B, C and D conduit were thus withdrawn in the absence of evidence that the demand for these facilities and the circumstances of their provisioning were sufficiently similar to those for Type A conduit to justify a uniform rate.
The Commission finds that, in the absence of this information, it has never been demonstrated that a rate of $2.25 for Type B, C and D conduit is just and reasonable as required by section 27 of the Act. The Commission concludes that, in the circumstances, there is substantial doubt as to the correctness of its approval of the withdrawal of the distinct rates for Type B, C and D conduit and the approval of a uniform monthly rate of $2.25 per 30 metres for all types of TCI's conduit.
The Commission notes that, based on information provided by parties to this proceeding, the withdrawal of the distinct rates for Type B, C and D conduit would significantly impact the cost of operations of the users of these facilities. Based on the 25 September 2001 TCI invoice filed by Shaw in this proceeding, the Commission estimates that a monthly rate of $2.25 per 30 metres for Type B, C and D conduit would increase Shaw's operating costs by approximately $1 million per year. Such a rate would likely increase the combined operating costs of Delta Cable and Coast Cable by approximately $66,000.00 per year. The Commission considers that the corresponding increase in the revenues TCI received would result from charging a rate that is not just and reasonable. It would appear from the record of this proceeding that TCI has not in fact been collecting the increased amounts.
The Commission concludes that, in these circumstances, it is appropriate to vary its original decision insofar as Type B, C and D conduit is concerned.
. . .
While the Commission remains of the view, set out in Order 2001-137 that "as a matter of regulatory policy rates approved on a final basis should not generally be subject to adjustment", it also considers that there are circumstances where to fail to make an exception would be to cause an injustice to an applicant. The Commission considers that such circumstances are present in this case. While the Commission also remains concerned about the uncertainty that retroactive rate adjustments can cause to carriers, this concern is attenuated in the present case by the fact that it was brought to TCI's attention in May 2000 that the rates for Type B, C and D conduit were at issue.
Accordingly, the Commission varies that part of Order 2000-13 in which it approved the proposal in TN 3637 to eliminate the definitions and distinct rates for TCI's Type A, B, C and D conduit and introduce a uniform definition and monthly rate of $2.25 per 30 metres for all of TCI's conduit, so as to restore the definitions and distinct rates that were in place prior to that decision. The Commission directs TCI to issue forthwith revised tariff pages, reinstating the definitions and the rates for Type A, B, C and D conduit in its serving area in British Columbia given final approval in Decision 95-13, effective 17 February 2000. [Emphasis added.]
Analysis of the decision under appeal and of the submissions of the parties
[37]I shall address first the appellant's argument that the CRTC had no jurisdiction to vary final rates retroactively or retrospectively under section 62 of the Act.
Whether the CRTC retroactively or retrospectively varied final rates under section 62 of the Act
[38]I should state at the outset that the parties agree that the standard of review applicable to the determination of this issue is that of correctness.
[39]The appellant contends that, in the context of a positive approval scheme of tariffs and rates, the CRTC has no jurisdiction under section 62 to vary rates which have received final approval, let alone to vary them retroactively, as it did in the present instance, by making its decision effective February 17, 2000. In support of its contention, it cites the decision of the Supreme Court of Canada in Bell Canada v. Canada (Canadian Radio-television and Telecommunications Commission), [1989] 1 S.C.R. 1722. I do not think that this decision carries the particular weight that the appellant attributes to it. The decision stands for the proposition that interim rates can be varied retroactively or retrospectively. For reasons that will become clear, I do not think that this case is of much assistance to the appellant.
[40]With respect, I believe the appellant misapprehends and therefore misstates what legally occurred in the case at bar in Telecom Decision CRTC 2003-54. The CRTC did not retroactively or retrospectively set rates as the appellant contends. Rather, it varied its decision by setting aside that part of its decision which was rendered in the absence of any evidence to support it and, therefore, in excess of jurisdiction and in violation of the fundamental duties imposed upon it by the Act. The effect, as it appears from paragraph 54 of its decision, was simply to restore the status quo ante which the invalid decision had altered. There was no setting of rates in Telecom Decision CRTC 2003-54.
[41]In Judicial Review of Administrative Action in Canada, looseleaf (Toronto: Canvasback Publishing, 1998), at pages 15-14 and 15-15, Brown and Evans describe the acceptance of "absence of evidence" as an independent ground of review of administrative action akin to a jurisdictional error. Under the heading "`No Evidence' as Jurisdictional Error", they write:
For nearly 60 years, it was generally accepted that an adjudicative tribunal did not exceed its statutory authority merely by basing its decision on a finding of fact that was unsupported by any evidence, unless the fact in question was "jurisdictional" in nature. Since the late 1970s, however, the courts have quietly abandoned this restrictive approach, and have elevated "no evidence" to an independent ground of review with the essential characteristics of jurisdictional error. That is, it can be proved by evidence extraneous to the tribunal's record, and judicial review is not subject to ouster by a preclusive clause.
In the case that marked the most decisive rejection of the earlier law, a decision of a labour arbitrator was held to be invalid on the ground that arbitrators have no jurisdiction to base their awards on findings of fact that are supported by "no evidence". Moreover, the court admitted evidence not in the tribunal's record to establish the error. And subsequently, the Supreme Court of Canada affirmed that decisions may be quashed for "no evidence", despite the presence of a preclusive clause.
[42]A decision rendered in the absence of evidence, like a decision rendered without jurisdiction, is a nullity and reviewable as arbitrary. In Douglas Aircraft Co. of Canada v. McConnell et al., [1980] 1 S.C.R. 245, at page 277, Estey J., dissenting on another point, asserted that arbitrary conduct, absence of evidence and refusal to discharge a function were jurisdictional errors which transcended the classification of errors in law on the face of the record:
Unfairness, the adoption of procedures contrary to natural justice, arbitrary conduct, refusal to discharge their function, fraud and bias in law, are all matters that transcend the classification of error in law on the face of the record. They are all jurisdictional in the fundamental sense of that term, and hence are reviewable through certiorari or its equivalent, with or without a privative clause. Such errors of law are not the same as but are equatable to the jurisdictional error which may arise from wrongful conclusions in statutory interpretation as in the Jarvis case, supra. Similarly, a decision without any evidence whatever in support is reviewable as being arbitrary; but on the other hand, insufficiency of evidence in the sense of appellate review is not jurisdictional. [Emphasis added.]
[43]In Chandler v. Alberta Association of Architects, [1989] 2 S.C.R. 848, the Practice Review Board of the Alberta Association of Architects conducted a hearing to review the practices of a firm of architects which had gone bankrupt. However, it issued findings and orders relating to disciplinary matters which were ultra vires the powers of the Board and quashed by the Court of Appeal [(1985), 67 A.R. 255]. Being mistaken as to the scope of its powers, the Board failed to consider making recommendations to the Council of the Alberta Association of Architects as it had the duty to do pursuant to paragraph 39(3) of the Architects Act [R.S.A. 1980, c. A-44.1].
[44]A month after the decision of the Court of Appeal, the Board gave notice to the parties that it intended to resume the original hearing in order to make recommendations to the Council. An application for prohibition was brought against the Board. The failure of the Board to consider matters which were part of its statutory duty, along with its power to continue the hearing, became the central issues before the courts. Unlike in the case at bar, the Architects Act did not confer on the Board any power to rescind, vary, amend or reconsider a final decision. Yet, at page 862, Sopinka J. found for the majority of the Supreme Court that the Board had the power and the obligation to fulfill its statutory duty:
Furthermore, it the tribunal has failed to dispose of an issue which is fairly raised by the proceedings and of which the tribunal is empowered by its enabling statute to dispose, it ought to be allowed to complete its statutory task. . . .
In this appeal we are concerned with the failure of the Board to dispose of the matter before it in a manner permitted by the Architects Act. The Board intended to make a final disposition but that disposition is a nullity. It amounts to no disposition at all in law. Traditionally, a tribunal, which makes a determination which is a nullity, has been permitted to reconsider the matter afresh and render a valid decision. [Emphasis added.]
[45]The Supreme Court's approach was followed by the High Court of Australia in Minister for Immigration and Multicultural Affairs v. Bhardwaj (2002), 187 ALR 117, although some judges expressed different views on whether the impugned decision was of no effect at all or produced some effect until quashed or set aside. At pages 129 and 130, Gaudron and Gummow JJ., with whom McHugh J. agreed, wrote:
There is, in our view, no reason in principle why the general law should treat administrative decisions involving jurisdictional error as binding or having legal effect unless and until set aside. A decision that involves jurisdictional error is a decision that lacks legal foundation and is properly regarded, in law, as no decision at all.
. . .
In our view, logic and legal principle both direct the conclusion that the approach of the Supreme Court of Canada is correct. As already pointed out, a decision involving jurisdictional error has no legal foundation and is properly to be regarded, in law, as no decision at all. Once that is accepted, it follows that, if the duty of the decision-maker is to make a decision with respect to a person's rights but, because of jurisdictional error, he or she proceeds to make what is, in law, no decision at all, then, in law, the duty to make a decision remains unperformed. Thus, not only is there no legal impediment under the general law to a decision-maker making such a decision but, as a matter of strict legal principle, he or she is required to do so. [Emphasis added.]
[46]Both the Chandler and Bhardwaj decisions recognize that many administrative decision makers possess implied powers of reconsideration to the extent that such powers are "needed `to enable the tribunal to discharge the function committed to it by [the] enabling legislation'": see Brown and Evans, at page 12-109. In the present instance, not only is the power to reconsider implied, it is expressly conferred on the CRTC by section 62 of its enabling legislation.
[47]Furthermore, section 27 of the Act, previously cited, requires, as indicated by the use of the word "shall", that rates charged by a Canadian carrier be "just and reasonable". It is the function and duty of the CRTC to ensure that that obligation, imposed upon Canadian carriers, is met at all times. In the Bell Canada case, Gonthier J. wrote for a unanimous Court at page 1740:
It is obvious from the legislative scheme set out in the Railway Act and the National Transportation Act that the appellant has been given broad powers for the purpose of ensuring that telephone rates and tariffs are, at all times, just and reasonable. The appellant may revise rates at any time, either of its own motion or in the context of an application made by an interested party. The appellant is not even bound by the relief sought by such applications and may make any order related thereto provided that the parties have received adequate notice of the issues to be dealt with at the hearing.
In this regard, section 47, hereinafter reproduced, is mandatory. It requires the CRTC to exercise its powers and perform its duties under the Act and any special Act "with a view to . . . ensuring that Canadian carriers provide telecommunications services and charge rates in accordance with section 27", that is to say services and charge rates that are just and reasonable:
47. The Commission shall exercise its powers and perform its duties under this Act and any special Act
(a) with a view to implementing the Canadian telecommunications policy objectives and ensuring that Canadian carriers provide telecommunications services and charge rates in accordance with section 27; and
[48]There is no doubt that the CRTC has jurisdiction, when so requested by an aggrieved party, to entertain an allegation that, as a result of an earlier decision, services and charge rates have become unjust and unreasonable. There is also no doubt in my respectful view that it has implied as well as express powers to recognize and acknowledge that a previous decision, in whole or in part, is a nullity and proceed to take appropriate corrective measures. Indeed, the legislative scheme governing the CRTC imposes upon it a duty to do so and confers to it broad powers to allow it to fulfill that duty.
[49]I have already mentioned the duties imposed on the CRTC by sections 27 and 47 as well as the power accorded to it in section 62 to rescind or vary its decisions. In order to ensure that services and charge rates are just and reasonable, paragraphs 32(d), (e) and (f) give the CRTC a broad discretionary power to suspend or disallow any portion of a tariff that is, in its opinion, inconsistent with section 27. It can, as a corrective measure, substitute or require a Canadian carrier to substitute other provisions for those disallowed, or require such carrier to file another tariff or another portion of it, in substitution for a suspended or disallowed tariff. Paragraph 32(g) gives the CRTC a residual power, in the absence of any applicable provision in Part I, to determine any matter and make any order relating to the rates, tariffs or telecommunications services of Canadian carriers. In this context, it is difficult to envisage a broader power than the one given to ensure that rates are just and reasonable at all times.
[50]These duties and powers provided in the Act are consistent with, and designed to implement, the legislative objectives found, for example, in paragraphs 7(b), (c) and (h) of the Act:
7. . . .
(b) to render reliable and affordable telecommunications services of high quality accessible to Canadians in both urban and rural areas in all regions of Canada;
(c) to enhance the efficiency and competitiveness, at the national and international levels, of Canadian telecommunications;
. . .
(h) to respond to the economic and social requirements of users of telecommunications services; and
Rates that are unjust and unreasonable compromise the accessibility of Canadians to affordable telecommuni-cations services and are not responsive to the economic requirements of the users of these services.
[51]In conclusion, the CRTC simply acknowledged or recognized the nullity of part of its Order 2000-13 which, in relation to TELUS' Type B to D conduit, "amounted to no disposition at all in law": see Chandler v. Alberta Association of Architects. This acknowledgment had the effect of dissipating doubts as to the applicability of the 1995 final definitions and rates from 1995 to the present because there was no disposition in law modifying them: see paragraph 54 of Telecom Decision CRTC 2003-54. Consistent with that effect, paragraph 55 of that decision directs TELUS to provide the necessary justification for the rate levels that it proposes if it wants to change the rates applicable to Type B to D conduit. In my view, not only was the decision legal and reasonable, it was necessary to insure that the rates for TELUS' Type B to D conduit be just and reasonable.
Whether section 62 of the Act allows the CRTC to vary final rates retroactively or retrospectively
[52]In view of my conclusion that the CRTC, in revisiting Order 2000-13, was not engaged in an exercise of retroactive or retrospective rate setting, there is no need to address this issue.
Whether, as contended, the CRTC breached the rules of procedural fairness by not permitting the appellant to make full and appropriate submissions on the issue of retroactivity
[53]The record before us shows that the appellant, in its submission to the CRTC in response to Shaw's application, argued the issue of retroactivity and retrospectivity. It cited the Bell Canada decision from the Supreme Court of Canada as well as a number of previous decisions in which the CRTC had concluded that, as a matter of regulatory policy, rates approved on a final basis should not generally be subject to adjustment: see the Appeal Book, at pages 57 and 58, paragraphs 36 to 40 and accompanying footnotes. In its response to the CCTA intervention, the appellant cross-referenced its previous answer to Shaw's application: see the Appeal Book, at page 78, paragraphs 53, 54 and footnote 34.
[54]Had I found that the CRTC was engaged in an exercise of retroactive or retrospective rates setting, I would also have found that the appellant had been given ample opportunity to argue the issue of retroactivity and that there was no denial of procedural fairness.
Whether the CRTC improperly exercised its discretion in permitting the respondents to challenge Order 2000-13 outside the 6-month time limit that it usually applies under section 62 of the Act
[55]I see no merit in this ground of appeal. The circumstances were unusual and there was nothing unreasonable in attempting first to resolve the imbroglio through mediation, although it resulted in some delay. In any event, I fail to see how and why, in the best interests of the parties and of the administration of justice, a direct attack could and should be barred by a limitation period when a collateral attack might be permitted against the part of Order 2000-13 that was rendered without jurisdiction: see R. v. Litchfield, [1993] 4 S.C.R. 333 and Dagenais v. Canadian Broadcasting Corp., [1994] 3 S.C.R. 835. In addition, I do not think that Parliament intended that a review of unjust and unreasonable rates, set in violation of the Act, be precluded by a time limit which would instead allow such rates to remain in place and flourish.
[56]For these reasons, I would dismiss the appeal with costs.
Décary J.A.: I agree.
Nadon J.A.: I agree.