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Standard of Review of Canadian Transportation Agency Decisions Clarified
Published in the March 2008 issue of Transportation Notes - View Article
The Federal Court of Appeal recently dismissed an appeal from a decision of the Canadian Transportation Agency (“the Agency”) brought by Canadian Pacific Railway (“CPR”). The appeal involved the Agency’s decision to grant the application of Atco Pipelines for the authority to construct above ground safety valves for its natural gas pipeline at two locations where the pipeline runs in the right of way, parallel to the railway track. At issue was whether the portions of the pipeline on which the safety valves are to be constructed fall within the definition of “utility crossing” for the purposes of section 100 of the Canada Transportation Act (“the Transportation Act”).
The Transportation Act defines “utility crossing” as the part of a utility line that passes over or under a railway line, and includes a structure supporting or protecting that part of the utility line or facilitating the crossing. “Utility line” is defined as a wire, cable, pipeline or other like means of enabling the transmission of goods or energy or the provision of services.
Atco Pipelines owns and operates a natural gas pipeline in Alberta. A portion of the pipeline is located on the CPR railway right of way, mostly beside the CPR track, and crosses under the track at three locations. The pipeline was built pursuant to an agreement between Atco’s predecessor and CPR but the agreement did not cover Atco’s proposed construction of the above ground valves; thus, authorization was sought and granted by the Agency. CPR argued that the definition of “utility crossing” in the Transportation Act is not broad enough to capture the portions of the pipeline where Atco proposed to construct the above ground valves because at those locations, the pipeline runs beside the track and not under it. This position is based on a literal meaning of the words “the part of a utility line that passes over or under a railway line” and assuming the words “railway line” mean only “railway track” and cannot have a broader meaning. Atco relied on the purposive, contextual approach to statutory interpretation to support the reading that “railway line” is intended to include the right of way on which a railway track is located, thus the definition of “utility line” would include any part of a pipeline that is on or under the railway right of way. The Agency accepted the purposive and contextual approach, noting the jurisprudence that supports the proposition that a “railway line” involves much more than just a “railway track”, including a railway right of way. The Agency decision was held to be reasonable and the Court did not intervene.
The most interesting portion of the Federal Court of Appeal’s judgment is its discussion of the standard of review to be applied to the Agency’s decision. CPR argued that the standard of review is correctness as it involved the interpretation of a statutory provision that defines the Agency’s jurisdiction. The Agency and Atco argued the standard of review is reasonableness and relied on Via Rail. The Federal Court of Appeal cited specific passages from Via Rail where the majority stated that the allegedly jurisdictional determination that the Agency was being asked to make fell squarely within its statutory mandate, involving its expertise to the legal issue assigned to it by the statute, thus entitling it to a single, deferential standard of review. The Federal Court of Appeal then held that the legal issue in this case is sufficiently like the issue in Via Rail, thus the same standard of review should apply, i.e.: reasonableness.
Much confusion has ensued since the Supreme Court of Canada’s decision in Via Rail with respect to the standard of review applicable to Agency decisions. This recent decision of the Federal Court of Appeal clarifies that not all decisions of the Agency should be assigned a single deferential standard of review, rather, only those decisions with similar legal issues as those in Via Rail should be assigned the same standard.
Canadian Pacific Railway v. Canada Transportation Agency, Atco Pipelines, 2008 FCA 42.