A-785-85
Attorney General of Canada (Appellant)
v.
Canadian Tobacco Manufacturers' Council,
Benson & Hedges (Canada) Inc., Imperial Tobac
co Limited, RJR-Macdonald Inc. and Rothmans
of Pall Mall Canada Limited (Respondents)
INDEXED AS: CANADIAN TOBACCO MANUFACTURERS' COUN
CIL V. NATIONAL FARM PRODUCTS MARKETING COUNCIL
(F.CA.)
Court of Appeal, Mahoney, Stone and MacGuigan
JJ.—Ottawa, February 11, 12 and March 6, 1986.
Agriculture — Inquiry under Farm Products Marketing
Agencies Act — Tobacco — Ontario Board, representing pro
ducers, proposing creation of national marketing agency —
National Farm Products Marketing Council conducting inqui
ry — Whether having duty to act fairly — Council's report to
Minister not prerequisite but may lead to proclamation —
Agency would have power to fix prices — Adverse effect on
manufacturers — Argument that Council merely fact finder
which decides nothing — Procedural fairness required in view
of role of Council's inquiry in decision-making process —
Trial Judge properly ordering re-opening of hearing for con
sideration of cost of production study received by Council after
hearing but before its report to Minister — Farm Products
Marketing Agencies Act, S.C. 1970-71-72, c. 65, ss.
2 (d),(e).(f),(g), 6, 7 ,( 1 )(a)(i), 8(1)(a),(3),(5), 10, 17(1),
18(1)(a),(b),(c),(e),(3) (as am. by S.C. 1984, c. 42, s. 1),
23(1)(a), (b).
Judicial review — Prerogative writs — Inquiry conducted
by National Farm Products Marketing Council — Council
administrative body charged only with duty to enquire and
advise — Given probable adverse effects on some parties of
ultimate decision based on recommendation, Council must
afford procedural fairness to parties in course of inquiry —
Farm Products Marketing Agencies Act, S.C. 1970-71-72, c.
65, ss. 2(d),(e),(f),(g), 6, 7(1)(a)(i), 8(1)(a),(3),(5), 10, 17(1),
18(1)(a),(b),(c),(e),(3) (as am. by S.C. 1984, c. 42, s. 1),
23(1)(a),(b) — Inquiries Act, R.S.C. 1970, c. I-13, Part I.
At the request of the Ontario Flue-Cured Tobacco Growers'
Marketing Board, the National Farm Products Marketing
Council undertook an inquiry into the merits of establishing a
national tobacco marketing agency and held public hearings to
that end.
The Council refused to order the Ontario Board to produce a
crucial cost of production study on the ground that its stated
policy of non-compellability prevented it from doing so. The
study was, however, delivered to the Council after the hearing
had ended, but before its report was presented to the Minister.
Alleging that they had thus been denied procedural fairness,
the respondents applied to the Trial Division for a series of
prerogative writs to require the reopening of a public hearing
and the introduction into evidence of the cost of production
study.
This is an appeal against the Trial Division order allowing
that application.
Held, the appeal should be dismissed, but the order varied to
provide for service of the notice of the reopening of the hearing
on all persons who were permitted to intervene at the initial
hearings.
The Council did have a duty to act fairly. It is clear that the
establishment of a marketing plan and an agency having the
power to fix prices would have an adverse effect on the
manufacturers. Therefore, even if the Council is an administra
tive body charged only with the duty to enquire and advise,
given this adverse effect and given the role that the Council's
inquiry has in the decision-making process—its expertise is
such that its recommendations carry a great deal of weight—
the Council is required to afford procedural fairness to those
whose rights and interests would be affected by a decision
based on its recommendation (see Saulnier and Abel).
An examination of the Council's duties and powers, and of
the decision making process makes it apparent that Parliament
has plainly recognized that, when an agency is established and
a marketing plan adopted, a decision affecting rights and
interests is taken and that it should not be taken without first
affording all affected the opportunity of a fair hearing. It has
expressly provided that opportunity as part of the Council's
inquiry and the Council is obliged to conduct the hearing
accordingly.
The relief granted by the Trial Judge was therefore warrant
ed and appropriate.
Per MacGuigan J.: The new approach to judicial review of
administrative action (as stated in Martineau) involves a recog
nition of a spectrum of judicial review of government decision-
making with greater procedural safeguards at the judicial end
of the spectrum diminishing to no safeguards/no review at the
other end, where purely legislative functions are in play. In the
present case, the functions are not in the purely legislative area,
and so must be reviewable.
While it is true that the Council's report to the Minister
affects no rights directly, that the Minister is not bound to act
on the report and that such a report is not a prerequisite to a
ministerial proposal to the Governor in Council nor to a
proclamation by the Governor in Council, Parliament clearly
intended an integral process stretching from public hearings to
executive proclamation, and in particular intended that, when a
report has been made, its consideration should become a pre
condition of ministerial and executive action. And the present
case meets the case law test of adverse effect for judicial review
to come into play: the Council's report, if favorable to the
tobacco growers, may well and indeed probably will adversely
affect the interests of the manufacturers of tobacco products.
CASES JUDICIALLY CONSIDERED
APPLIED:
Saulnier v. Quebec Police Commission, [1976] 1 S.C.R.
572; In re Pergamon Press Ltd., [1971] Ch. 388 (C.A.);
Re Abel et al. and Advisory Review Board (1980), 31
O.R. (2d) 520 (C.A.), affirming (1979), 97 D.L.R. (3d)
304 (Div. Ct.).
REFERRED TO:
Ridge v. Baldwin, [1964] A.C. 40 (H.L.); Nicholson v.
Haldimand-Norfolk Regional Board of Commissioners
of Police, [1979] 1 S.C.R. 311; Martineau v. Matsqui
Institution Disciplinary Board, [1980] 1 S.C.R. 602.
COUNSEL:
Brian J. Saunders and David Byer for
appellant.
François Lemieux, James H. Smellie and
David K. Wilson for Ontario Flue-Cured
Tobacco Growers Marketing Board and
Prince Edward Island Tobacco Commodity
Marketing Board.
Michael A. Kelen for Canadian Tobacco
Manufacturers' Council.
John B. Claxton, Q.C. and Bernard Amyot
for Benson & Hedges (Canada).
Simon V. Potter for Imperial Tobacco
Limited.
Georges-R. Thibaudeau for RJR-Macdonald
Inc.
Frank K. Roberts, Q.C. for Rothmans of Pall
Mall Canada Limited.
SOLICITORS:
Deputy Attorney General of Canada for
appellant.
Osler, Hoskin & Harcourt, Ottawa, for
Ontario Flue-Cured Tobacco Growers Mar
keting Board and Prince Edward Island
Tobacco Commodity Marketing Board.
Michael A. Kelen, Ottawa, for Canadian
Tobacco Manufacturers' Council.
Lafleur, Brown, de Grandpré, Montreal, for
Benson & Hedges (Canada).
Ogilvy, Renault, Montreal, for Imperial
Tobacco Limited.
Doheny, Mackenzie, Montreal, for RJR-Mac-
donald Inc.
Smith, Lyons, Torrance, Stevenson & Mayer,
Toronto, for Rothmans of Pall Mall Canada
Limited.
The following are the reasons for judgment
rendered in English by
MAHONEY J.: This is an appeal by the Attorney
General of Canada, by leave, and by the cross-
appellants, the Ontario Flue-Cured Tobacco
Growers' Marketing Board and the Prince Edward
Island Tobacco Commodity Marketing Board,
against an order of the Trial Division [[1986] 1
F.C. 401] granting relief in the nature of certio-
rari, prohibition and mandamus in respect of
actions taken, proposed to be taken and omitted to
be taken by the National Farm Products Market
ing Council, hereinafter "the Council", in the
course of or consequent upon an inquiry pursuant
to subparagraph 7(1)(a)(i) of the Farm Products
Marketing Agencies Act, S.C. 1970-71-72, c. 65,
as amended. The appellants, other than the Attor
ney General, represent tobacco growers. The
respondents are manufacturers of tobacco products
and their trade association. They buy substantially
all tobacco produced in Canada. The primary issue
is whether the Council had a duty to act fairly; if it
did, a number of other issues must be dealt with.
The Council, constituted under the Act, consists
of at least 3 and at most 9 members appointed by
the Governor in Council, at least half of whom are
required to be primary producers and one-third of
whom are, if possible, to be from each of the four
western provinces, the two central provinces and
the four Atlantic provinces. Its duties, set out in
section 6 of the Act, include:
6. (1) The duties of the Council are
(a) to advise the Minister on all matters relating to the
establishment and operation of agencies under this Act with
a view to maintaining and promoting an efficient and com
petitive agriculture industry;
(2) In carrying out its duties the Council shall consult, on a
continuing basis, with the governments of all provinces having
an interest in the establishment or the exercise of the powers of
any one or more agencies under this Act or with any body or
bodies established by the government of any province to exer
cise powers similar to those of the Council in relation to
intraprovincial trade in farm products.
The subject proceedings were instituted by a writ
ten request of the Ontario Flue-Cured Tobacco
Growers' Marketing Board, hereinafter "the
Ontario Board", as contemplated by subparagraph
7(1)(a)(i), that a national tobacco marketing
agency be established.
7. (1) In order to fulfil its duties the Council
(a) on receipt of a written request from one or more associa
tions representing a significant number of persons engaged in
the growing or production of the farm product or farm
products in Canada or if directed to do so by the Minister
shall, or on its own initiative may, inquire into the merits of
(i) establishing an agency in respect of a farm product or
farm products and vesting it with all or any of the powers
set out in section 23, or
and report its recommendations to the Minister including the
terms of an appropriate marketing plan where, in its opinion,
it is appropriate that an agency be vested with power to
implement such a plan in relation to the farm product or
farm products to which the inquiry relates;
In the circumstances, it was mandatory that a
public hearing be held and a panel was constituted
pursuant to subsection 8(3). The material provi
sions of section 8 follow:
8. (1) A public hearing shall be held by the Council
(a) in connection with an inquiry into the merits of establish
ing an agency or of broadening the authority of an existing
agency to cover an additional farm product or farm products;
(3) The chairman may direct that a public hearing under this
section be heard on behalf of the Council by two or more
members thereof designated by him, and the members so
designated have and may exercise for the purpose of such
hearing the powers of the Council set out in subsection (5) and
shall report to the Council on such hearing.
(5) The Council has, in respect of any public hearing under
this section, all the powers of a commissioner appointed under
Part I of the Inquiries Act.
It is pertinent to note that Part I of the Inquiries
Act [R.S.C. 1970, c. I-13], inter alia, empowers
the Council to require and compel the attendance
of witnesses, the production of documents and the
giving of evidence under oath or on solemn
affirmation.
The Council's report to the Minister pursuant to
paragraph 7(1)(a) may lead to a proclamation
under subsection 17(1). Such a report is not, how
ever, prescribed as a prerequisite to the Governor
in Council establishing an agency.
17. (1) The Governor in Council may by proclamation
establish an agency with powers relating to any farm product or
farm products the marketing of which in interprovincial and
export trade is not regulated pursuant to the Canadian Wheat
Board Act or the Canadian Dairy Commission Act where he is
satisfied that a majority of the producers of the farm product or
of cach of the farm products in Canada is in favour of the
establishment of an agency.
18. (1) A proclamation establishing an agency shall
(a) designate the farm product or farm products in relation
to which the agency may exercise its powers and indicate
whether such powers may be exercised in relation to
(i) any such product or products to the extent that it is or
they are grown or produced anywhere in Canada, or.
(ii) any such product or products to the extent that it is or
they are grown or produced in any region of Canada
designated in the proclamation, or in any such region and
anywhere in Canada outside that region for shipment into
that region in interprovincial trade and not for export;
(b) designate any of the powers set out in section 23 that are
not vested in the agency;
(c) set out the terms of any marketing plan that the agency is
empowered to implement;
(e) fix the number of members of the agency, which shall be
not less than three and not more than twelve at least a
majority of whom shall be primary producers ....
(3) A proclamation referred to in subsection (1) or (2) that
designates a farm product other than tobacco, eggs or poultry
or any part of tobacco, eggs or poultry shall not set out as a
term of the marketing plan that an agency is empowered to
implement any term that would enable the agency to fix and
determine the quantity in which any regulated product could be
marketed in interprovincial or export trade by persons engaged
in such marketing thereof.
23. (1) Subject to the proclamation by which it is established
and to any subsequent proclamation altering its powers, an
agency may
(a) purchase any regulated product in relation to which it
may exercise its powers and any farm product, wherever
grown or produced that is of the same kind as the regulated
product in relation to which it may exercise its powers, and
package, process, store, ship, insure, export or sell or other
wise dispose of any such product purchased by it;
(b) implement a marketing plan the terms of which are set
out in the proclamation establishing it or in any subsequent
proclamation issued under subsection (2) of section 18 in
respect of it;
The foregoing provisions of the Act are to be
understood in light of the definitions set forth in
section 2, and particularly the expanded definition
of "marketing".
2....
(d) "marketing", in relation to any farm product that is not a
regulated product, includes selling and offering for sale and
buying, pricing, assembling, packing, processing, transport
ing, storing and any other act necessary to prepare the
product in a form or to make it available at a place and time
for purchase for consumption or use, and in relation to a
regulated product, includes only such of the above acts as are
specified in the marketing plan relating to the regulated
product;
(e) "marketing plan" means a plan relating to the promotion,
regulation and control of the marketing of any regulated
product in interprovincial or export trade that includes provi
sion for all or any of the following:
(ii) the specification of those acts that constitute the
marketing of the regulated product and of those persons
engaged in its marketing, as so specified, in interprovincial
or export trade, and for the exemption of any class of
persons so engaged from the marketing plan or any aspect
thereof;
(iii) the marketing of the regulated product on a basis that
enables the agency that is implementing the plan to fix and
determine the quantity, if any, in which the regulated
product or any variety, class or grade thereof may be
marketed in interprovincial or export trade by each person
engaged in such marketing thereof and by all persons so
engaged, and the price, time and place at which the
regulated product or any variety, class or grade thereof
may be so marketed;
(v) a system for the licensing of persons engaged in the
growing or production of the regulated product for, or the
marketing thereof in, interprovincial or export trade,
including provision for fees, other than fees related to the
right to grow the regulated product, payable to the appro
priate agency by any such person in respect of any licence
issued to him and for the cancellation or suspension of any
such licence where a term or condition thereof is not
complied with; and
(vi) the imposition and collection by the appropriate
agency of levies or charges from persons engaged in the
growing or production of the regulated product or the
marketing thereof and for such purposes classifying those
persons into groups and specifying the levies or charges, if
any, payable by the members of each such group;
(/) "Minister" means the Minister of Agriculture; and
(g) "regulated product" means any farm product to the
extent that it is grown or produced
(i) anywhere in Canada, if an agency is authorized to
exercise its powers in relation to any such product grown
or produced in Canada, or
Currently, the manufacturers purchase Canadi-
an tobacco production at auction with negotiated
average floor prices. Establishment of the agency
and marketing plan proposed by the Ontario
Board would replace that system with an agency,
controlled by the producers, having the power to
fix prices. Since the underlying premise is that the
producers have not, for several years, recovered
their production costs, it is to be inferred that any
agency and plan would cost the manufacturers.
The adverse effect of the proposal on the interests
of the manufacturers is clear. The Council is not
limited in what it may recommend to the Ontario
Board's proposal nor is the Governor in Council so
limited in what may be proclaimed. The limitation
is imposed by the statute and, it is evident, given
the definition of "marketing", that the potential of
an agency and plan to affect the existing rights
and interests of the manufacturers is very great
indeed.
In arguing that the Council has no duty to
observe procedural fairness in the hearing conduct
ed pursuant to paragraph 8(1)(a), the appellants
rely on the proposition that the Council decides
nothing. It has merely a fact finding function. Its
recommendations to the Minister affect no rights.
The Minister is not bound to act on its report. A
report by the Council is neither a prerequisite to a
recommendation by the Minister to the Governor
in Council nor to a proclamation by the latter. It is
the decision to issue a proclamation, made by the
Governor in Council, that affects rights.
The Council is, in short, in the appellants' sub
mission, an administrative body charged only with
the duty to enquire and advise. That, strictly
speaking, is true but that is not an end of the
matter.
In Saulnier v. Quebec Police Commission,
[1976] 1 S.C.R. 572, the Supreme Court of
Canada dealt with an inquiry into the conduct of
the director of a police department whose report to
the provincial Attorney General had requested the
latter to undertake an evaluation of the qualifica
tions of the director to hold his office with a view
to the "standardization" of his rank and duties. It
appears to have been accepted that this report was
not a censure or a recommendation of punitive
action which would have engaged the express
requirement of the governing statute that the
director be heard. The matter was not dealt with
by the Court as though the report were a sham.
Rather, the report was accepted as merely a
recommendation that further action be taken
which might result in a penalty. The Supreme
Court, at page 579, quoted with approval a pas
sage from the dissenting judgment of Casey J.A.,
of the Quebec Court of Appeal who said, in part:
Appellant has rendered a decision that may well impair if not
destroy Respondent's reputation and future. ... when I recall
that the whole purpose of these reports is to present facts and
recommendations on which normally the Minister will act the
argument that no rights have been determined and that nothing
has been decided is pure sophistry.
In re Pergamon Press Ltd., [1971] Ch. 388
(C.A.), was concerned with the conduct of an
inquiry by inspectors appointed under a British
statute to investigate and report to the Board of
Trade on the affairs of a company. A copy of the
report was required to be given to the company,
which was entitled to publish it, even though the
Board of Trade might not act on it at all. The
judgment of Lord Denning, M.R., is most fre
quently quoted; however, for the present purposes
the following passage from the judgment of Buck-
ley L.J., at page 407, is succinct and equally apt.
If it is found that a director or officer has made some default or
acted improperly in relation to the conduct of the company's
affairs, this may well prompt the company to institute proceed
ings against him, or it may prompt others to institute proceed
ings against him. In those proceedings the person proceeded
against would have the full protection of a judicial process, but,
particularly since the company is entitled to a copy of the
report, he should not be exposed to the risk of such proceedings
without being given a fair opportunity by the inspectors to
forestall an adverse report.
Finally, in Re Abel et al. and Advisory Review
Board (1980), 31 O.R. (2d) 520, the Ontario
Court of Appeal considered the inquiry required to
be undertaken annually by a review board into the
continued detention of persons under Lieutenant
Governor's warrants. There, as here, the legisla
tion provided for the tribunal to be composed of
persons knowledgeable of the questions they would
have to deal with. The Court, per Arnup J.A., at
page 532, quoted Dickson J. [as he then was], in
Martineau v. Matsqui Institution Disciplinary
Board, [ 1980] 1 S.C.R. 602, at pages 622-623:
In my opinion, certiorari avails as a remedy wherever a
public body has power to decide any matter affecting the rights,
interests, property, privileges or liberties of any person.
It held that the review board "has power to decide
such a question" and went on to quote the reasons
for judgment of Grange J., in the Divisional Court
decision under appeal, (1979), 97 D.L.R. (3d) 304,
at page 318:
The Lieutenant-Governor is, of course, not bound to act upon
the recommendations in the report, but I do not think I-go too
far—indeed I think I only state the obvious—when I say that a
patient's only hope of release lies in a favourable recommenda
tion by the Board..
Just as the Lieutenant-Governor need not act upon the
Board's report so the Board need not act upon the information
and reports of the officer in charge, but there can be no
question that these will influence the Board and may in many
cases be decisive. If counsel for the patient seeks, as he must, to
represent his client properly, one can well understand his desire,
even his imperative need, to examine such reports.
Arnup J.A. went on [at pages 532-533]:
I agree completely with these comments, but I would go even
further. The whole purpose of the establishment of an advisory
review board was to create an independent body, bringing to its
task a considerable and varied expertise of its own, and likely to
develop quickly an even greater expertise with the kind of
problem assigned to it, with the hoped-for result that no one
would be kept indefinitely in a mental institution, half-forgot
ten, and with his situation unreviewed except by the staff of the
institution. It is inherent in the conception and operation of
such a board that its recommendations will virtually always be
accepted.
I accept that considerations unrelated to the
Council's expertise might lead the Minister or
Governor in Council to decline to follow its recom
mendations. Nevertheless, the role of the review
board described in Abel and the role of the Coun
cil in the scheme of the present Act are, in my
opinion, quite similar.
A tribunal which enquires and recommends but
does not decide may be required to observe proce
dural fairness. Whether or not the requirement
exists in a given situation depends on either or
both of two considerations: (1) the actual role of
the inquiry in the decision-making process; and (2)
the potential effect of the recommendation itself
absent an ensuing decision. Saulnier and Abel
exemplify the requirement based on the first con
sideration; Saulnier and Pergamon exemplify the
second, particularly in their concern for personal
reputations.
I do not think the present case can turn on the
second consideration. However, I am satisfied that
Parliament has, in the Act, given the Council's
inquiry a role in the decision-making process that
requires it to afford procedural fairness to those
whose rights and interests would be affected by a
decision based on its recommendation.
In reaching that conclusion, I am persuaded by
the aggregate of the provisions which Parliament
has made respecting the Council's duties and
powers and the reality of the process that would
ordinarily ensue upon a recommendation if it were
to be considered by the Minister and the Governor
in Council. As to the establishment of an agency,
the Council has the duty to advise the Minister
"on all matters" and to consult interested provin-
cial governments; it is required to inquire into the
merits of such establishment if producers request
it; when it inquires, it must hold a public hearing
and, in holding it, the Council has been given the
powers of a commissioner under Part I of the
Inquiries Act. While representations may be made
to the Minister and to the Governor in Council,
the nature of the process at those levels does not
admit of a fair hearing in the sense of a person
having an opportunity to answer contrary positions
because he simply may not know what they are.
Parliament has plainly recognized that, when an
agency is established and a marketing plan adopt
ed, a decision affecting rights and interests is taken
and that it should not be taken without first
affording all affected the opportunity of a fair
hearing. It has expressly provided that opportunity
as part of the Council's inquiry and the Council is
obliged to conduct the hearing accordingly.
The alleged denials of natural justice are all
concerned with a report, hereinafter "the 1983
C.O.P. Study", which the Ontario Board commis
sioned a few days before it submitted its proposal
that an agency be established. The proposal, sub
mitted to the Council on October 15, 1984, alleged
that Ontario producers had not, in seven of the
preceding eight years, recovered their cost of pro
duction plus a reasonable return. Notice of a
public hearing was published by the Council call
ing on interested persons to file submissions by
March 1, 1985. On February 12, the Ontario
Board filed a supplement to its proposal stating, in
part:
Cost of production pricing is one of the fundamental objec
tives of the Proposal. The Proposal states that, based on
Ontario Board estimates, producers in Ontario, over a number
of recent years, have received a price for their product which is
less than the cost of producing tobacco and a reasonable return.
The Ontario Board retained Touche Ross & Partners to
make an independent assessment of the matter.
Touche Ross & Partners has concluded that, in 1983,
Ontario flue-cured tobacco growers received a minimum aver-
age price which was below the cost of production and a
reasonable return for producing that crop.
The respondents duly filed their submission, which
put the alleged shortfall in price into issue. They
were recognized as intervenors by the Council.
Public hearings were scheduled on 11 days be
tween April 16 and May 31, 1985, inclusive.
Prior to the commencement of the hearing, the
Council sent a Notice of Deficiency to the Ontario
Board noting that its material did not include the
1983 C.O.P. Study. On the first day of the hear
ing, the respondents sought an order
... that the Ontario Board produce the Touche, Ross cost of
production study in time so that the manufacturers can consid
er that for the purpose of this Inquiry.
The Council disposed of that application by sug
gesting that, and then permitting, the Ontario
Board delete the reference to the 1983 C.O.P.
Study from its supplementary proposal. On May 8,
the respondents moved for an order that the
Ontario Board be required to produce all docu
mentation in its possession and that of Touche,
Ross & Partners concerning the 1983 C.O.P.
Study, that the respondents be given a reasonable
opportunity to examine it and, if necessary, that
the inquiry adjourn until the documentation was
produced. At the time, further public sessions were
scheduled for May 9, 10, 16, 17, 30 and 31. On
May 14, the Council dismissed the motion in a
written decision stating, in part:
By deleting all reference to it in its submission, though, the
Ontario Board has indicated that it does not wish to advance
any arguments based upon the 1983 study. The Board has also
elected to refuse to answer any questions about the study. For
the reason previously stated the panel regrets this decision by
the Ontario Board and views the omission as a missed opportu
nity to make a significant contribution to its objective of
assisting the panel to understand how the proposed agency
would operate to improve the situation in the tobacco industry.
The panel, however, has a stated policy of allowing parties to
choose the submissions and supporting evidence they wish to
make in this hearing. Accordingly, it is the view of the panel
that to allow this motion would unduly prejudice the rights of
the other parties to this proceeding who have operated through
out under this general guideline of non-compellibility when
either presenting evidence or cross-examining witnesses. Fur
ther, given the late date at which this motion is made, in the
view of the panel, to allow it would necessitate a complete
rehearing on the matter which would involve considerable
delays and additional costs and expenses to all parties. Finally,
the panel believes that in the evidence and cross-examination of
the witness representing Touche -Ross & Partners considerable
information has been brought to light on the subject of cost of
production and that as this cross-examination proceeds in the
area of appropriate methodologies it may well serve to partially
alleviate the fact that the report for 1983 is not yet available.
The 1983 C.O.P. Study was, in fact, delivered to
the Council after the hearing had ended. The
respondents immediately sought to have the hear
ing reopened. They were advised that a decision to
reopen could not be made until the Council met
again and that a meeting could not be held before
the intended date of delivery of the Council's
report to the Minister.
The learned Trial Judge made the following
order:
1. It is ordered that pursuant to Rule 307(3) of the Rules and
Orders of the Federal Court of Canada service of the originat
ing notice of motion in this matter on the respondent, the
Ontario Flue Cured Tobacco Growers' Marketing Board, the
Prince Edward Island Tobacco Commodity Marketing Board,
the Simcoe Leaf Tobacco Co. Ltd., Dibrell Brothers of Canada
Ltd., Standard Commercial Tobacco Company of Canada Ltd.
is sufficient for the purpose of this hearing.
2. An order of mandamus is hereby made requiring the
respondent to re-open its hearing held in accordance with
section 9 of the Farm Products Marketing Agencies Act in
connection with an inquiry into the merits of establishing a
marketing agency for flue-cured tobacco. The respondent is
required to consider the Touche, Ross & Partners 1983 Cost of
Production Study, and to compel the attendance of such wit
nesses as are necessary to lead evidence on the said study. The
respondent is required to permit cross-examination by the
applicants, and if necessary permit the introduction of rebuttal
evidence by any party.
3. An order of certiorari is hereby made quashing the Inquiry
Panel report dated on or about August 21, 1985 and the
respondent's report to the Minister of Agriculture.
4. An order of prohition is hereby made preventing the respond
ent, until the above hearing has been completed from reporting
its recommendations to the Minister of Agriculture pursuant to
section 7(1) of the Farm Products Marketing Agencies Act.
5. It is further ordered that notice of the reopening of the
hearing shall be deemed sufficient if served on the parties to
this application. Any other person, group or corporation who
participated in the previous four hearings at London, Ontario;
Charlottetown, P.E.I., Montreal, Quebec; or Ottawa, Ontario
may apply to the respondent to be heard but it shall not be
necessary to notify these parties.
6. The applicants are entitled to their costs of this motion as
against the respondent forthwith after taxation thereof.
Since the 1983 C.O.P. Study is now in existence
and the Council has it, it would be otiose to dwell
on the alleged refusal of the Council to exercise its
jurisdiction by adhering to its stated policy in
totally inappropriate circumstances. Suffice it to
say, Parliament has, by subsection 8(5) of the Act,
vested the Council with powers which it may be
required to invoke from time to time in the exer
cise of its jurisdiction and its failure to do so may
well amount to an improper refusal of jurisdiction.
For the same reason, no useful purpose would be
served in dwelling on the panel's suggestion that
reference to the 1983 C.O.P. Study be deleted
from the supplementary submission nor the dispo
sition of the initial motion to compel its
production.
The 1983 C.O.P. Study does exist. The Council
has it. It is a timely, professional study relevant to
an issue of crucial importance to the Council's
report to the Minister. The relief granted by the
learned Trial Judge was warranted and appropri
ate.
I have only reservation as to his order. The
record discloses that 61 submissions were filed
with the Council. It does not disclose how many
persons were permitted to intervene at the hearing.
Paragraph 1 of the order restricted nunc pro tunc
the persons given notice of the proceedings in the
Trial Division and that effectively defined those
given notice of this appeal. Paragraph 5 of the
order puts an onus on interested persons, not party
to these proceedings, which, with respect, seems
impractical. I would vary paragraph 5 to read:
5. It is further ordered that notice of the reopening of the
hearing be served by the Council on all persons who were
permitted to intervene at the initial hearings.
I would otherwise dismiss this appeal with costs.
STONE J.: I agree.
* * *
The following are the reasons for judgment
rendered in English by
MACGUIGAN J.: I am in full agreement both
with the disposition of the case proposed by my
brother Mr. Justice Mahoney and with his reasons
for that disposition. I wish merely to add some
supporting considerations with respect to the issue
of reviewability by this Court of the report to the
Minister of Agriculture ("the Minister") by the
National Farm Products Marketing Council ("the
Council") in relation to the merits of establishing
a national tobacco marketing agency.
In my view the approach to judicial review of
administrative action since Ridge v. Baldwin,
[ 1964] A.C. 40 (H.L.) in England and Nicholson
v. Haldimand-Norfolk Regional Board of Com
missioners of Police, [1979] 1 S.C.R. 311 in
Canada was accurately stated by Dickson J. (as he
then was) in Martineau v. Matsqui Institution
Disciplinary Board, [ 1980] 1 S.C.R. 602, at pages
628-629:
The authorities, in my view, support the following
conclusions:
1. Certiorari is available as a general remedy for supervision
of the machinery of government decision-making. The order
may go to any public body with power to decide any matter
affecting the rights, interests, property, privileges, or liberty of
any person. The basis for the broad reach of this remedy is the
general duty of fairness resting on all public decision-makers.
2. A purely ministerial decision, on broad grounds of public
policy, will typically afford the individual no procedural protec
tion, and any attack upon such a decision will have to be
founded upon abuse of discretion. Similarly, public bodies
exercising legislative functions may not be amenable to judicial
supervision. On the other hand, a function that approaches the
judicial end of the spectrum will entail substantial procedural
safeguards. Between the judicial decisions and those which are
discretionary and policy-oriented will be found a myriad deci-
sion-making processes with a flexible gradation of procedural
fairness through the administrative spectrum. That is what
emerges from the decision of this Court in Nicholson. In these
cases, an applicant may obtain certiorari to enforce a breach of
the duty of procedural fairness.
The new approach involves a recognition of a
spectrum of judicial review of government deci-
sion-making with greater procedural safeguards at
the judicial end of the spectrum, diminishing to no
safeguards/no review at the other end, where
purely legislative functions are in play. In the case
of the Council, section 10 of the Farm Products
Marketing Agencies Act ("the Act") provides for
such purely legislative action, which would prob
ably not be subject to judicial review:
10. The Council may make rules respecting the conduct of
public hearings under section 8 and generally respecting the
conduct of business of the Council in relation thereto.
But Council action under section 8, which provides
for public hearings by the Council in connection
with an inquiry into the merits of establishing an
agency, as here, is not in the purely legislative
area, and so must be reviewable.
It is true that the Council's report to the Minis
ter affects no rights directly. It is true that the
Minister is not bound to act on its report. It is true
that its report is a prerequisite neither to a minis
terial proposal to the Governor in Council nor to a
proclamation by the Governor in Council.
Nevertheless, in my view the clear implication of
the Act, which allows an association such as the
Ontario Flue-Cured Tobacco Growers' Marketing
Board in this case to initiate an inquiry,' which
must be by public hearing, 2 in which the Council is
' 7. (1) ... the Council
(a) on receipt of a written request ... inquire into the merits
of
(i) establishing an agency in respect of a farm product or
farm products ....
2 8. (1) A public hearing shall be held by the Council
(a) in connection with an inquiry into the merits of establish
ing an agency ....
armed with all powers under Part I of the In
quiries Act,' and which must culminate in a report
to the Minister containing the Council's
recommendations, 4 is that, once the report is made,
the Minister must at least take it into account, and
if he makes subsequent recommendations to the
Governor in Council, the Governor in Council also
must take it into consideration in reaching his
decision. Any other interpretation of the Act
would reduce the deliberately expressed intention
of Parliament in this statute to a meaningless
sham. Even though leaving the Executive with the
power to act on its own initiative entirely, Parlia
ment clearly intended an integral process stretch
ing from public hearings to executive proclama
tion, and in particular intended that, when a report
had been made, its consideration should become a
precondition of ministerial and executive action.
In Saulnier v. Quebec Police Commission,
[1976] 1 S.C.R. 572, at page 579, the Supreme
Court of Canada found it sufficient for judicial
review that an investigation report "may well"
adversely affect a police director's reputation and
future, being a report "on which normally the
Minister will act". In In re Pergamon Press Ltd.,
[1971] Ch. 388 (C.A.), at page 400, Lord Denning
M.R. justified review on the ground the inspectors'
report "may lead" to adverse consequences for
company directors. The adverse effects must, it
seems, be more than merely possible; they must be
somewhere close to probable, or perhaps even
probable. 5
3s....
(5) The Council has, in respect of any public hearing under
this section, all the powers of a commissioner appointed under
Part I of the Inquiries Act.
4 7. (1) ...
and report its recommendations to the Minister including the
terms of an appropriate marketing plan where, in its opinion, it
is appropriate that an agency be vested with power to imple
ment such a plan in relation to the farm product or farm
products to which the inquiry relates;
somewhere close to probable, or perhaps even
probable.'
Here, Parliament has established as the normal
route to the establishment of a marketing agency a
public process affording wide participation by
those potentially affected. It intends that, when a
report has been made, it shall be taken seriously. I
believe it is not necessary for a Court to weigh out
in mathematical fashion the degree of probability
of the adverse result in order to conclude that,
since the Council's report, if favorable to the inter
ests of the tobacco growers, may well and indeed
probably will adversely affect the interests of
manufacturers of tobacco products, the case is
made for judicial review.
In Re Abel et al. and Advisory Review Board (1980), 31
O.R. (2d) 520, at pp. 532-533, the Ontario Court of Appeal per
Arnup J.A. found it to be "inherent in the conception and
operation of such a board [an advisory review board for psy
chiatric facilities] that its recommendations will virtually
always be accepted" [emphasis added]. However, this was
advanced as a conclusion on the facts rather than as a require
ment of the law.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.