A-941-96
( T-554-91 )
Carpenter Fishing Corporation, Don Johannes, Kaarina Etheridge, Simpson Fishing Co. Ltd., White Hope Holdings Ltd. and Norman Johnson (Plaintiffs) (Respondents)
v.
Her Majesty the Queen in Right of Canada and Bernard Valcourt, Minister of Fisheries and Oceans (Defendants) (Appellants)
( T-974-91 )
Titan Fishing Ltd. (Plaintiff) (Respondent)
v.
Her Majesty the Queen in Right of Canada and Bernard Valcourt, Minister of Fisheries and Oceans (Defendants) (Appellants)
Indexed as: Carpenter Fishing Corp.v. Canada (C.A.)
Court of Appeal, Pratte, Décary and Linden JJ.A." Vancouver, December 4; Ottawa, December 23, 1997.
Fisheries — Quota system established by Minister of Fisheries and Oceans for halibut fishing on West Coast — Respondents challenging process leading to adoption of catch history allocation — Trial Judge declaring Minister's decision to implement current owner restriction unlawful — Erred in treating Minister's decision not as legislative action — Imposition of quota policy discretionary decision in nature of policy, legislative action — Fisheries Act, s. 7(1) giving Minister absolute discretion to issue fishing licences — Courts to intervene only when Minister's actions beyond broad purposes permitted under Act — Court should not question Minister's judgment as to propriety of quota policy.
Administrative law — Judicial review — Declarations — Trial Judge declaring current owner restriction, part of formula to determine halibut fishing quota, unlawful — Imposition of quota policy discretionary decision, legislative action — Policy guidelines not subject to judicial review unless tainted by bad faith, non-conformity with natural justice, irrelevant purpose — Standard of review of administrative functions inapplicable to legislative action — Legislative, policy decisions not subject to principles of natural justice — Not for Court to question wisdom of Minister's policy decision — Trial Judge became Minister for day in substituting respondents' formula for Minister's.
Practice — Judgments and orders — Unless authorized by Federal Court Rules, only one judgment should be rendered following trial — Judgment should dispose of all issues between parties — Judgment not to be rendered —by instalments—.
This was an appeal from a Trial Division decision declaring that a decision made in 1990 by the Minister of Fisheries and Oceans to implement the current owner restriction, which is part of a formula to determine halibut quota, was unlawful. In 1990, the Minister established a quota system for halibut fishing on the West Coast of Canada. The formula retained by the Minister, as a policy and general guideline for the attribution of individual quotas to licence holders, was based 30% on vessel length and 70% on catch history of the licence during the period 1986-1989. The respondents, who were individuals and corporations involved in the West Coast halibut fishery, argued that the process that led to the adoption of the catch history allocation was undemocratic and that the Minister based the catch history allocation on the past experience of the licence holder rather than on that of the licence itself. In ruling in favour of the respondents, the Trial Judge found that the decision of the Minister to implement the "current owner restriction" upon halibut licence holders by way of a condition to fish was "not an administrative decision which is legislative in nature", that the respondents were therefore entitled to procedural fairness and that the process of consultation followed by the Department was undemocratic and breached the rules of natural justice. That ruling was the subject of the present appeal.
Held, the appeal should be allowed.
The procedure followed by the Trial Judge, splitting the issues to be decided in two parts, the legality issue and the relief, was unusual. Unless a contrary practice is authorized by the Federal Court Rules, only one judgment should be rendered following the trial of an action and that judgment should dispose of all the issues between the parties. Although a trial judge may split a trial into many phases, he should not, after a phase of the trial, render a judgment unless that judgment disposes of the action. A judgment should not be rendered "by instalments".
The Trial Judge erred in not treating the Minister's decision as legislative action. That error lead him to impose adherence to the rules of natural justice that did not apply and to second-guess the propriety of the halibut quota attributed by the Minister. The imposition of a quota policy (as opposed to the granting of a specific licence) is a discretionary decision in the nature of policy or legislative action. Provided he does not fetter his discretion to grant a licence by treating the guidelines as binding upon him, the Minister may indicate considerations which he will be guided by as a general rule when allocating quotas. These policy guidelines are not subject to judicial review, unless tainted by any of the three vices recognized by the Supreme Court of Canada in Maple Lodge Farms Ltd. v. Government of Canada: bad faith, non-conformity with the principles of natural justice and reliance upon considerations irrelevant or extraneous to the statutory purpose. The act of granting a licence cannot be challenged under the general rules applicable to administrative actions in so far as its policy component"the implementation of the quota policy by the Minister"is concerned. When examining an attack on an administrative action (the granting of a licence) a component of which is a legislative action (the establishment of a quota policy) reviewing courts should be careful not to apply to the legislative component the standard of review applicable to administrative functions. An allegation of bad faith against a minister is so serious and damaging that a trial judge should require that it be express and unequivocal; in this case, the respondents and the Trial Judge were content with elusive innuendos. Generally speaking, the principles of natural justice do not apply to legislative or policy decisions. In the case at bar, the Minister was under no legal duty to hold consultations, but nevertheless chose to do so. Therefore, the finding by the Trial Judge that the process was undemocratic was not only irrelevant but also unsupported by the evidence. Under subsection 7(1) of the Fisheries Act , the Minister is given the "absolute discretion" to issue fishing licences. When exercising his powers, duties, functions and discretion in relation to the establishment and implementation of a fishing quota policy, the Minister should also be given the widest possible freedom to manœuvre. It is only when his actions are clearly beyond the broad purposes of the Act that courts should intervene. The formula adopted by the Minister might not have been the wisest or most logical one, but it is not the Court's function to question his judgment as to whether a quota policy is good or bad. The respondents asked the Trial Judge to substitute their own formula for that of the Minister. In complying with their request, he became the Minister for a day and imposed a formula which had an unknown and untested effect on the halibut fishery.
statutes and regulations judicially considered considered
Department of Fisheries and Oceans Act, R.S.C., 1985, c. F-15, s. 4(1)(a).
Federal Court Rules, C.R.C., c. 663.
Fisheries Act, R.S.C., 1985, c. F-14, ss. 7(1), 43.
Inquiries Act, R.S.C., 1985, c. I-11.
Pacific Fishery Regulations, 1984, SOR/84-337, s. 6(1) (as enacted by SOR/84-351, s. 2).
cases judicially considered
applied:
Maple Lodge Farms Ltd. v. Government of Canada, [1982] 2 S.C.R. 2; (1982), 137 D.L.R. (3d) 558; 44 N.R. 354; Canadian Assn. of Regulated Importers v. Canada (Attorney General), [1994] 2 F.C. 247; (1994), 17 Admin. L.R. (2d) 121; 164 N.R. 342 (C.A.).
considered:
Gulf Trollers Assn. v. Canada (Minister of Fisheries and Oceans), [1987] 2 F.C. 93; (1986), 32 D.L.R. (4th) 737; [1987] 2 W.W.R. 727; 72 N.R. 31 (C.A.); leave to appeal to S.C.C. refused, [1987] 1 S.C.R. viii; Comeau's Sea Foods Ltd. v. Canada (Minister of Fisheries and Oceans), [1997] 1 S.C.R. 12; (1997), 142 D.L.R. (4th) 193; 43 Admin. L.R. (2d) 1; 31 C.C.L.T. (2d) 236; 206 N.R. 363.
APPEAL from a Trial Division decision ([1997] 1 F.C. 874 (abridged); (1996), 123 F.T.R. 81) declaring that a decision made by the Minister of Fisheries and Oceans in 1990 to implement the current owner restriction, which is part of a formula to determine halibut quota on the West Coast, was unlawful. Appeal allowed.
counsel:
Harry J. Wruck, Q.C., for appellants.
P. G. Bernard, Murray L. Smith and David Jones for respondents.
J. Raymond Pollard and Georg D. Reuter for intervenor Pacific Coast Fishing Vessel Owners Guild.
solicitors:
Deputy Attorney General of Canada for appellants.
Campney & Murphy, Vancouver, for respondents.
Richards Buell Sutton, Vancouver, for intervenor Pacific Coast Fishing Vessel Owners Guild.
The following are the reasons for judgment rendered in English by
Décary J.A.: In 1990, the Minister of Fisheries and Oceans (the Minister) established a quota system for halibut fishing on the West Coast of Canada. The formula retained by the Minister, as a policy and general guideline for the attribution of individual quotas to licence holders, was the following: an allocation of 30% was attributed to vessel length and an allocation of 70% was attributed to historical performance of the current owner, the latter allocation, being described as follows:
The catch history used . . . is based on the one best catch year, adjusted for variations in annual total catch, during the 1986 through 1989 period attributed to the current owner of the halibut licence regardless of what vessel fished the halibut licence. [A.B., Vol. 9, at p. 1610.]
The formula was adopted on a two-year trial basis, starting in 1991. In practical terms, the catch history allocation meant the following: where a licence holder had owned a licence since the 1986 fishing year, his one best catch year would be any year between 1986 and 1989; where a licence holder had owned a licence since the 1987 fishing season, his one best catch year would be any year between 1987 and 1989; where a licence holder had owned a licence since the 1988 fishing season, his one best catch year would be 1988 or 1989; where a licence holder had owned a licence since the 1989 fishing season, his one best catch year would necessarily be 1989; and to allow late entrants in the industry to have access to the catch history allocation, where a licence holder had bought his licence after the 1989 fishing season, his one best catch year was deemed to be the one best catch year, established as above, of his immediate vendor.
The respondents were not satisfied with the process that led to the adoption of the catch history allocation, which they found undemocratic, nor with the fact that the Minister based the catch history allocation on the past experience of the licence holder rather than on that of the licence itself, thereby favouring, in their view, those fishermen who had owned a licence over a longer period. The respondents described that part of the formula they did not agree with as "the current owner restriction". They did not, however, question the idea of basing the allocation partly on the vessel length and partly on the catch history, nor did they question the percentages of 30% and 70% retained in so doing. Further, they did not question the use of the year 1986 as a starting point nor the use of the year 1989 as a closing point. Essentially, they were of the view that all licence holders should have the benefit of the one best catch year of the licence between the 1986 and the 1989 fishing seasons whether or not they had themselves owned a licence during those years. As a matter of fact, the respondents acquired their licences between the fall of 1987 and February 1990 and were all limited to a choice of the best of fewer than four years.
In late 1991, the respondents filed a statement of claim against the Crown and against the then Minister of Fisheries and Oceans, the Honourable Bernard Valcourt whereby they sought a declaration that "the current owner restriction" in the catch history allocation was unlawful, and damages, including punitive and exemplary damages.
The trial took place in 1996. By agreement, the issues to be decided at trial were split in two parts: the legality issue and, if and when illegality was found, the relief.
At the conclusion of that part of the trial which related to the legality issue, Campbell J., on November 14, 1996 [[1997] 1 F.C. 874], found in favour of plaintiffs (respondents on the appeal) and made the following declaration [at pages 896-897]:
. . . that the Minister's decision in 1990 to implement the current owner restriction is unlawful, . . . [and therefore] is a nullity.
"further [at page 897]:
. . . that each similar decision made up to the present day is also unlawful and is also a nullity.
The Crown and the Minister appeal this finding, with the support of the intervenor, the Pacific Coast Fishing Vessel Owners Guild.
Before dealing with the merit of the appeal, I cannot help but observe, although the parties did not raise any objection in that respect, that the procedure followed by the Trial Judge is, to say the least, unusual. Excepting the cases where a contrary practice is authorized by the Federal Court Rules [C.R.C., c. 663], only one judgment should be rendered following the trial of an action and that judgment should dispose of all the issues between the parties. A trial judge may certainly split a trial into many phases; he should not, however, after a phase of the trial, render a judgment unless that judgment disposes of the action. A judgment should not be rendered "by instalments". Despite of this irregularity we have nevertheless heard the appeal; a year has elapsed since the reasons for judgment have been issued and the interests of all require that no further delay be incurred. In view of the conclusion we have ultimately reached, the decision to hear the appeal has now proved to be a wise one. However, we do not wish to be seen as condoning the practice of splitting the judgment followed by the Trial Judge in a case such as the present one.
The History of the Quota Policy
A brief history of the events leading to the adoption by the Minister of the quota policy is warranted at this stage.
In 1979, the Department of Fisheries and Oceans (the Department) created a limited-licensing system, under which licences convey rights to a limited number of people or vessels, in an attempt to control and reduce the size of the Canadian halibut fishing fleet, which was grossly overexpanded.
In 1982, Dr. Peter Pearce was commissioned by the Government of Canada under the Inquiries Act [R.S.C., 1985, c. I-11] to review and report on the Pacific fishery, including the halibut fishery. Dr. Pearce concluded that the Pacific fisheries were at a crisis point and that fundamental changes were required in fisheries policy in order to correct the situation. He recommended that the limited-licensing system in place in the halibut fishery be replaced by a more effective quota licence system.
The following observations of Commissioner Pearce are worth noting:
"general observations:
To design an appropriate policy for the future, and to implement it successfully, the cooperative participation of those who will be most directly affected by it is essential. [My emphasis; A.B., Vol. 5, at p. 760.]
In addition to conflicting interests, vested interests pose an obstacle to introducing changes. The strongest resistance to regulatory reform typically comes from the regulated groups because they have adapted themselves to the prevailing system.
Because of these conflicting and vested interests, policy changes will usually benefit some at the expense of others. [My emphasis; A.B., Vol. 5, at p. 768.]
The more a system depends on compelling licensees to behave contrary to their economic interests, the more complex the regulations need to be. Furthermore, a licensing technique that relies on compulsion for achieving the desired objectives is under much more strain than one that relies on private incentives. So, clearly, a licensing policy that is consistent with licensees' economic interests is preferable to one that is not. [My emphasis; A.B., Vol. 5, at p. 840.]
However, as a means for regulating the catch and promoting fleet rationalization, licensing individual fishermen's quotas holds more promise than any of the other approaches described above. Wherever it has been introduced, although there have been various adjustment problems, it has substantially eased problems of resource management and reversed trends toward overcapitalization. [My emphasis; A.B., Vol. 5, at p. 841.]
The most sensitive task is that of making the transition from the present arrangements equitably and without causing dislocation of established interests. I therefore turn first to propose general procedures for effecting the transition to quota licences for all of these fisheries.
. . .
The shift from an established limited-entry licensing system to individual quotas will require procedures to bridge the old and the new. In Chapter 8 I concluded that fishermen who have demonstrated a dependency on a fishery should be "grandfathered" in under new licensing arrangements. When quota licences are introduced, the fairest way to allocate the allowable catch among the established participants in the fisheries is according to their shares of the catch in the recent past . The selection of the base years for determining past participation is important, however; long periods dilute the impact of abnormally high or low catches in any one year, but they tend to discriminate against recent entrants and those who have recently increased their catch shares. On the other hand, a very short period"such as a single season"can lead to serious distortions among fishermen . . . .
The proposed rules for initially allocating the new fishing privileges may be unfair to some fishermen. In the past, when new limited-entry licences have been introduced, special appeal committees have considered the special circumstances of individual fishermen and have recommended that eligibility criteria be waived or relaxed to prevent hardship. These have served a useful purpose and this general approach should be followed in the future. [My emphasis; A.B., Vol. 5, at p. 876.]
Finally, the Department should obtain the advice and guidance of licensees before implementing new quota systems. [A.B., Vol. 5, at p. 877.]
"observations pertaining specifically to the halibut fishery:
During the last few years the organization of the halibut fishery has deteriorated seriously. The licensing system applied to this long-established fishery has been extremely troublesome and badly managed. In spite of a limited-entry system intended to prevent it, the licensed fishing capacity has expanded alarmingly. At the same time, both the available catch and prices have fallen sharply. [A.B., Vol. 5, at pp. 877-878.]
The proposed grandfathering in of licensees' quotas according to their recent catch shares appears to be the most equitable way of recognizing the difference between those who comprise the main halibut fleet and those who qualified for licences by way of incidental catches. [A.B., Vol. 5, at p. 880.]
As a result of the Pearce Report, the Minister appointed an advisory committee of halibut fishers to assist in developing a quota system for the 1983 halibut fishing season. However, the plan did not go ahead due to a lack of industry support. Industry support was critical to any efforts by the Department to manage the halibut fishery because this fishery is at least partially self-regulating, and, accordingly, lack of support could well result in non-compliance.
The halibut fishery being more and more at risk and the Department having realized that it was absolutely essential to build support for a quota system within the industry, the Department, on September 11, 1989, presented a discussion paper on individual quotas to all halibut licence holders.
The paper proposed a method "recommended by halibut industry representatives" which combined two criteria: catch history of the licence (as opposed to catch history of a specific fisherman) (70%) and historical catch by vessel class (30%). The catch history of the licence was to be based on an average of the two best years of catches between 1986 and 1988. If the licence had fished all three years, then an average of the two best years would be used. If the licence had fished only one year, then that year would be considered the average. If the licence did not fish between 1986 and 1988, then no historical catch share would be allocated to the licence (A.B., Vol. 3, at page 582). The paper proposed a two-year trial period and explained that an appeal board would be established to deal with those fishermen who felt their quota was unfair. A meeting was announced for October, where the Department would hear from all halibut fishermen's organization and each fisherman was invited to contact representatives of his organization or a representative, Mr. Turris, of the Department. The paper made it clear that the Department was "willing to consider alternative approaches if the halibut industry does not consider the [proposed] method feasible".
Meetings were held with halibut licence holders in Richmond and Prince Rupert on October 23, 24 and 30, 1989. Alternative methods were then proposed by some fishermen, including, for example, allocation based on equal shares to everyone and allocation based on the catch history of the person (as opposed to that of the licence).
On November 1, 1989, the Department provided all halibut licence holders with a summary of the October meetings and a questionnaire respecting the use of individual quotas, the preferred allocation methods and the preferred method for choosing representatives of the industry on an eventual halibut industry committee.
On December 4, 1989, the Department informed all halibut licence holders of the results of the survey. Seventy-seven percent of those who answered supported the use of individual quotas, but no single allocation method had been chosen by a majority and no single option for the selection of representatives had been preferred by a majority. The Department also informed the licence holders that it had selected a method of forming the halibut committee and asked them to choose which one of 12 organizations they wanted to be represented by on the committee (A.B., Vol. 4, at page 598). The Halibut Advisory Committee was formed in December, 1989. It was made up of 21 industry representatives, 17 of which were fishermen or fishing organizations representing licence holders. The Department also invited four representatives to represent the concerns of crewmen, shoreworkers, and processing companies.
The Committee held meetings on January 23-26 and May 1-3, 1990 to develop a detailed proposal for halibut licence holders' further consideration. On May 3, 1990, the Committee voted in favour of a motion proposing that the catch history of the person be retained as a criterion rather than the catch history of the licence.
On June 4, 1990, the Department provided a detailed proposal to each licence holder and asked him whether or not he supported the proposal (A.B., Vol. 4, at pages 616 ff.).
On August 13, 1990, the Department informed the licence holders of the results of the vote, as tabulated by the accounting firm of Price Waterhouse. Of the 435 ballots sent, 298 were returned, four of which were spoiled. Of the 294 unspoiled ballots, 206 (70%) voted in favour of the proposal, while 88 (30%) voted against.
All of the respondents, except for two, indicated on their ballots that they supported the proposal. The respondent Johnson indicated that he did not support it. The respondent, Carpenter Fishing Co., was not a halibut licence holder at the time and its predecessor, Deep Six Fish (1987) Co. Ltd., did not vote.
On November 1, 1990, the Minister announced the introduction of the two-year trial program as well as the establishment of an appeal board "to hear appeals from halibut licence holders in disagreement with their [quota] allocation" (A.B., Vol. 4, at page 637).
The seven respondents were notified of their quota allocations for 1991. Six of them appealed to the appeal board. The appeal board recommended that their quota be increased. The Minister agreed and their licenses were issued by the Minister incorporating the increased quota.
At the end of the two-year trial period, i.e. at the end of the 1992 fishing season, all 435 halibut licence holders were given the opportunity to vote on the continuation of the program, including the existing allocation formula. Three hundred and twenty responses were received, with 91% (292) voting "yes" and 9% (28) voting "no" (A.B., Vol. 8, at p. 1323). All of the respondents voted "yes" in 1992. We were told that subsequent ministers have adopted the same policy.
Analysis
In finding in favour of the respondents, the Trial Judge expressed the view that the decision of the Minister to implement the "current owner restriction" upon halibut licence holders by way of a condition to fish was "not an administrative decision which is legislative in nature",1 that the respondents were therefore entitled to procedural fairness, that the process of consultation followed by the Department was undemocratic and breached the rules of natural justice and that the Minister acted for an improper motive in endorsing a policy which was discriminatory.
In my view, the Trial Judge erred in hearing and assessing the evidence on the basis that what was in issue was not legislative action. That error lead him to impose adherence to rules of natural justice that did not apply and to examine the evidence as if he was entitled to second-guess the propriety of the quota attributed by the Minister.
The imposition of a quota policy (as opposed to the granting of a specific licence) is a discretionary decision in the nature of policy or legislative action. Policy guidelines outlining the general requirements for the granting of licences are not regulations; nor do they have the force of law. It flows from the decision of the Supreme Court of Canada in Maple Lodge Farms Ltd. v. Government of Canada2 and from the decision of this Court in Canadian Assn. of Regulated Importers v. Canada (Attorney General),3 that the Minister, provided he does not fetter his discretion to grant a licence by treating the guidelines as binding upon him, may validly and properly indicate the kind of considerations by which he will be guided as a general rule when allocating quotas. These discretionary policy guidelines are not subject to judicial review, save according to the three exceptions set out in Maple Lodge Farms: bad faith, non-conformity with the principles of natural justice where their application is required by statute and reliance placed upon considerations that are irrelevant or extraneous to the statutory purpose.
Once the Minister, through his Department, has defined policy guidelines, what is requested from him when granting a licence is to direct his attention to the applicant and to satisfy himself that the general guidelines may be fairly applied to that applicant. To the extent that the policy is developed by the Minister in the exercise of his general duties under the Fisheries Act4 and that it is not blindly applied by him in the later exercise of his discretion when granting a specific licence, the act of granting the licence, however administrative in nature and otherwise subject to ordinary judicial review as it may be, cannot be challenged under the general rules applicable to administrative actions in so far as its policy component, i.e. the implementation of the quota policy by the Minister is concerned. When examining an attack on an administrative action"the granting of the licence"a component of which is a legislative action "the establishment of a quota policy"reviewing courts should be careful not to apply to the legislative component the standard of review applicable to administrative functions. The line may be a fine one to draw but whenever an indirect attack on a quota policy is made through a direct attack on the granting of a licence, courts should isolate the former and apply to it the standards applicable to the review of legislative action as defined in Maple Lodge Farms .
Bad Faith
Allegations and findings of bad faith against a minister are so serious and damaging that the least one can expect from a litigant and from a trial judge is that they make them expressly and unequivocally. Unfortunately, in the case at bar, the respondents and the Trial Judge were content with elusive innuendos that make the task of the appellants and of this Court very difficult.
As I understand the Trial Judge's finding, there is bad faith when a public servant favours the adoption of a quota policy knowing that it will hurt some entrants in the industry. This proposition can simply not be sustained. If the quota policy is adopted for a valid purpose"I will deal with this issue shortly"one cannot look at its effects to condemn the motives of its proponents. In any event, there is no evidence that permits to impute to the Minister the alleged motive of his representative on the Committee, nor can it be assumed that the motive of the Minister in adopting the whole policy (in the unlikely hypothesis that he acted on the basis of a single motive) was the very one allegedly professed by that representative when proposing the impugned part of a formula which is itself but part of the policy.
Natural Justice
Generally, the principles of natural justice do not apply to legislative or policy decisions.5 There may be cases"this is not one of them"where consultation with the public is required by statute to be held prior to the adoption of a policy, but even then, consultation with the public does not import the normal rules of natural justice into the process. In the case at bar, the Minister was under no legal duty to hold consultation but he nevertheless chose to do so. It is not the function of courts to pass judgment on the propriety of the method of consultation followed by a minister as long as the requirements of the legislation, if any, have been complied with. The finding by the Trial Judge that the process was undemocratic was at best irrelevant, at worst totally unsupported by the evidence.
Irrelevant Purpose
The last possible basis of an attack on the Minister's actions is that they were based on considerations irrelevant or extraneous to the statutory purpose. The Trial Judge found that the purpose of the impugned part of the policy was to discriminate against new entrants to the fishery in order to benefit, and thus gain support of, old entrants.
Permissible purposes for actions under the Fisheries Act are interpreted in a particularly broad way. This Court, in Gulf Trollers Assn. v. Canada (Minister of Fisheries and Oceans)6 has found that:
Parliament may manage the fishery on social, economic or other grounds, either in conjunction with steps taken to conserve, protect, harvest the reserve or simply to carry out social, cultural or economic goals and policies.
The Supreme Court of Canada, in Comeau's Sea Foods Ltd. v. Canada (Minister of Fisheries and Oceans)7 has observed that:
Canada's fisheries are a "common property resource", belonging to all the people of Canada. Under the Fisheries Act , it is the Minister's duty to manage, conserve and develop the fishery on behalf of Canadians in the public interest.
I note also that under paragraph 4(1)(a) of the Department of Fisheries and Oceans Act:8
4. (1) The powers, duties and functions of the Minister extend to and include all matters over which Parliament has jurisdiction . . . relating to
(a) sea coast and inland fisheries;
Pursuant to subsection 7(1) of the Fisheries Act, the Minister is given the "absolute discretion" to issue fishing licences. In Comeau's , the Supreme Court [at pages 25-26] found that the breadth of the Minister's decision was "consonant with the overall policy of the Fisheries Act" and that "Licensing is a tool in the arsenal of powers available to the Minister under the Fisheries Act to manage fisheries".
Section 43 of the Fisheries Act authorizes the Governor in Council to:
43. . . . make regulations for carrying out the purposes and provisions of this Act and in particular . . . [to] make regulations
(a) for the proper management and control of the sea-coast and inland fisheries;
(b) respecting the conservation and protection of fish;
. . .
(g) respecting the terms and conditions under which a licence . . . may be issued.
The regulations which were in force in 1990, the Pacific Fishery Regulations, 1984,9 gave the Minister the power, in subsection 6(1), to:
6. (1) . . . specify in a commercial fishing licence issued under section 7 of the Fisheries Act the following terms and conditions:
(a) the species and quantity of fish that may be caught;
It follows that when examining the exercise by the Minister of his powers, duties, functions and discretion in relation to the establishment and implementation of a fishing quota policy, courts should recognize, and give effect to, the avowed intent of Parliament and of the Governor in Council to confer to the Minister the widest possible freedom to manœuvre. It is only when actions of the Ministry otherwise authorized by the Fisheries Act are clearly beyond the broad purposes permitted under the Act that courts should intervene.
Assuming for the sake of the discussion that the purpose of the Department's officers can be imputed to the Minister"there is no evidence as to why the Minister endorsed the policy suggested by his officers", and that one can isolate a segment of a formula in looking for the purpose of the whole formula, the Trial Judge's finding does not withstand scrutiny.
Quotas invariably and inescapably carry with them some element of arbitrariness and unfairness. Some fishermen may win, others may lose, some may win or lose more than others, most if not all will find themselves with less catches than before. It is at best in that sense, and not in the legal sense, that one can speak, in cases such as the present one, in terms of discrimination. If this were found to be discrimination, then it would be discrimination authorized by statute. The need for objective standards in regulating an industry that was until then self-governed requires tough decisions to be made that will hurt some less than others. Seldom, if ever, is the imposition of quotas a win-win situation.
Considering the wide ambit of the permissible purposes under the Fisheries Act, considering the factors retained by the Minister in the present case, considering that the Department was searching for a consensus in order to experiment a totally new approach in licensing the halibut fishery, and keeping in mind the observations and recommendations made by Commissioner Pearce in his Report, can it reasonably be said that a compromise which attracted the support of the halibut industry, which was centred on the personal fishing experience of the licence holders, which allowed for new entrants to participate in the quotas on the basis of the personal fishing experience of their immediate predecessor and which preserved the right of dissatisfied licence holders to challenge the quotas attributed to them under the chosen formula, is based on considerations irrelevant or extraneous to the statutory purpose of the Fisheries Act? Of course not.
Perhaps the formula adopted is not the best one, or the wisest one, or the most logical one, but the Minister is not bound to pick the best, the wisest or the most logical one and it is certainly not the function of the courts to question his judgment as to whether a quota policy is good or bad. Perhaps the factors considered by the Minister are not of equal relevance, but as Linden J.A. observed in Canadian Assn. of Regulated Importers:10
It is not fatal to a policy decision that some irrelevant factors be taken into account; it is only when such a decision is based entirely or predominantly on irrelevant factors that it is impeachable.
In the case at bar, the respondents did not argue that their licence had been illegally issued or that their quota had been illegally attributed to them: the last thing they would want is to be deprived both of their licence and of their quota, however insufficient in their view the latter may be. They did not even argue that the whole of the policy was illegal, for they wanted the formula they were proposing to survive the Court's decision. They rather argued that the Minister's decision to implement part of the policy"what they called the current owner restriction"was illegal and that the illegal part could be severed from the policy. They asked the Trial Judge, for all practical purposes, to substitute their own formula to that of the Minister, without any consultation with the industry and without any vote. In complying with their request, the Trial Judge became the Minister for a day and imposed a formula the effect of which on the halibut fishery is unknown and untested. This, clearly, the Trial Judge could not do, even if he had been right in finding the policy invalid; the most he could have done would have been to remit the matter back to the Minister for reconsideration and adoption of a different formula. It is only in the rare occasion where a component of a policy is so irrelevant and contrary to public policy"quota, for example, that would be allocated in part on the basis of the colour of the skin of the fisherman"that a court could take upon itself to sever that component from the formula.
Finally, even if the Trial Judge had not erred in finding part of the formula unlawful, he could not act as he did by extending his declaration of illegality to all decisions made by ministers subsequent to the original implementation of quotas. The policy at issue in these proceedings was the trial policy adopted by the Minister in 1990. Policies successively adopted afterwards by ministers who were not even made parties to the proceedings were not at issue and no evidence was led as to the process that led to their adoption. Furthermore, new regulations came into force in 1993 and the legality of the Minister's actions could not but be examined in the context of the changes arguably resulting from these regulations.
The appeal should be allowed, the actions in files T-554-91 and T-974-91 should be dismissed and the appellants should be entitled to their costs here and below.
Pratte J.A.: I agree.
Linden J.A.: I agree.
1 [1997] 1 F.C. 874 (T.D.), at pp. 890-891.
2 [1982] 2 S.C.R. 2.
3 [1994] 2 F.C. 247 (C.A.).
4 R.S.C., 1985, c. F-14, as it read in 1990.
5 See: Canadian Assn. of Regulated Importers, supra, note 3, at p. 249.
6 [1987] 2 F.C. 93 (C.A.), at p. 106, leave to appeal to Supreme Court of Canada refused, [1987] 1 S.C.R. viii.
7 [1997] 1 S.C.R. 12, at pp. 25-26.
8 R.S.C., 1985, c. F-15.
9 SOR/84-337, s. 6(1) (as enacted by SOR/84-351 s. 2).
10 Supra, note 3, at p. 260.