[1996] 3 F.C. 539
96-T-13
Atlantic Oil Workers Union (Applicant)
v.
Director of Investigation and Research, Bureau of Competition Policy and Ultramar Canada Inc. (Respondents)
Indexed as: Atlantic Oil Workers Union v. Canada (Director of Investigation and Research, Bureau of Competition Policy) (T.D.)
Trial Division, MacKay J.—Halifax, February 13; Ottawa, June 7, 1996.
Practice — Variation of time — Motion for extension of time to file application for judicial review of Investigation and Research Director’s decision Ultramar had complied with undertakings could close down Dartmouth, Nova Scotia oil refinery — Application filed out of time, Union’s solicitor misunderstanding calculation of 30-day time limit during Christmas holidays — No reasonable chance of success in arguable case — Applicable test upon review of discretionary administrative decision: whether decision patently unreasonable.
Administrative law — Judicial review — Motion for extension of time to file application for judicial review of Investigation and Research Director’s decision Ultramar had complied with undertakings, could close oil refinery — Applicable test upon review of discretionary administrative decision: whether decision patently unreasonable.
The respondent, Ultramar Canada Inc., acquired the Dartmouth, Nova Scotia refinery from Imperial Oil Limited following a consent order of the Competition Tribunal in February 1990. The order authorized the Director to approve acquisition of the refinery and other assets, subject to general terms set out in the Tribunal’s order. Ultramar’s acquisition of the refinery was subsequently approved upon certain undertakings which it gave in September 1990 to the Director, one of which being that it would operate the refinery for a minimum of seven years barring a material adverse change. In October 1993, Ultramar also undertook that if it were to notify the Director of its intention to cease operating the refinery before the end of the seven-year term, it would offer the refinery for sale without unreasonable restriction on the price and would provide the Director with evidence establishing whether there was any reasonable legitimate continuing interest on the part of a viable party to maintain the refinery as an operating business in Canada. That undertaking provided that Ultramar would be in compliance if it established to the Director’s satisfaction that it had publicly marketed the refinery, without unreasonable restriction on the price and that there was no legitimate expression of interest to purchase and continue operation of the refinery. In May 1994, Ultramar gave notice that it intended to cease operations at the refinery. In September 1994, the Attorney General of Nova Scotia filed an application in this Court seeking an order to prohibit the Director from determining whether there had been a material adverse change. And when Ultramar closed the refinery in October 1994, the Province filed a second application for judicial review in this Court for an order to require the Director to compel Ultramar to continue the refinery operations. Both applications were dismissed in August 1995. In October 1995, the Director determined that there had been a material adverse change and, in December 1995, the Director issued a decision finding that Ultramar had complied with the October 1993 undertakings in that it had sought to publicly market its oil refinery at Dartmouth without unreasonable restriction on the price and there was no legitimate expression of interest to purchase the refinery and continue its operation.
The Union sought to bring an application for judicial review of the Director’s decision, but the application was filed late due to a misunderstanding of how the thirty-day time limit for filing would be applied in light of the Christmas holidays. This was an application for an order pursuant to subsection 18.1(2) of the Federal Court Act for an extension of time to file the application.
Held, the application should be dismissed.
The applicant did not meet the conditions for being granted an extension of the time limit to file an application.
In this case, it was conceded that the applicant intended to bring the application in a timely fashion and had not abandoned that intent. However, the applicant has failed to establish that it had a reasonable chance of success in an arguable case.
The argument that the Director had breached his duty of fairness (failure to produce all of the evidence to the Union in advance of his decision) was briefly commented upon. There was no evidence that the Union ever requested an opportunity to review all of the material before the Director. Moreover, it has not been established that the applicant had the right to review all such information. Even if that ground were properly before the Court, it would not raise a reasonable chance of success.
This Court would be reluctant to intervene unless persuaded that the decisions were patently unreasonable in the sense that they were not based on any evidence or relevant legal principle. Particularly is this so where the decisions cannot be said to be in relation to the Director’s jurisdiction, but rather they concern matters clearly falling within his or her discretion to determine, under his or her statutory authority and the terms of the arrangements the Director had earlier approved for Ultramar’s acquisition of the refinery, including its written undertakings.
In essence, the argument was that since the Competition Tribunal’s consent order in February 1990 described the refinery as including the refinery and related dock and terminal facilities with storage capacity, the Director erred in finding compliance with its 1993 undertakings to publicly market the refinery when it failed to include the dock and terminal and related storage capacity in the package which it offered for sale as the refinery. This was not borne out by an examination of the decision. There were already two decisions, one by the Competition Tribunal and one by this Court, which have found that undertakings by Ultramar to the Director were not a part of the consent order of 1990, and the terms of the consent order were not the source of the Director’s authority in relation to the undertakings given by Ultramar. Industry practice, therefore, was not irrelevant. Furthermore, the undertakings may be questioned or enforced only by one of the two parties to them, the Director and Ultramar. Where they are agreed on their interpretation, a different interpretation offered by others cannot be given credence by the Court. Therefore, the applicant could not establish that the decision of the Director, in assessing the asset package offered for sale, was patently unreasonable and the applicant had no reasonable chance of success in arguing this ground for judicial review.
The Union further urged that the Director erred when he found Ultramar had complied with its undertaking to publicly market the refinery without any unreasonable restriction on the price. The argument was that by failing to indicate the price for which it was willing to sell the refinery, Ultramar unreasonably restricted the price by refusing to disclose it completely. Failure to set an asking price, in itself, cannot, in the circumstances of this case, be characterized as unreasonably restricting the price.
Nor can the Director’s conclusion that there was no legitimate expression of interest to purchase the refinery and continue its operation be characterized as unreasonable.
While the general standard that the underlying consideration in such a case as this is whether, in the circumstances, an extension of time to commence proceedings is called for to do justice between the parties, that does not require that the Court waive the basic statutory rule limiting time to commence proceedings where the Court concludes the applicant, on the basis of the material and argument presented in support of the extension, has no reasonable chance of success, no arguable case, for judicial review.
If the unionized workers’ goal of returning to work at the refinery is to be achieved, it will be as a result of the decisions of others, not of the courts.
STATUTES AND REGULATIONS JUDICIALLY CONSIDERED
Competition Act, R.S.C., 1985, c. C-34 (as am. by R.S.C., 1985 (2nd Supp.), c. 19, s. 19).
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 28(2).
Federal Court Act, R.S.C., 1985, c. F-7, s. 18.1 (as enacted by S.C. 1990, c. 8, s. 5).
Federal Court Rules, C.R.C., c. 663, R. 1618 (as enacted by SOR/92-43, s. 19).
CASES JUDICIALLY CONSIDERED
APPLIED:
Grewal v. Minister of Employment and Immigration, [1985] 2 F.C. 263 (1985), 63 N.R. 106 (C.A.); LeBlanc v. National Bank of Canada, [1994] 1 F.C. 81(T.D.); 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; Gingras v. Canada, [1990] 2 F.C. 68 (1990), 69 D.L.R. (4th) 55 (T.D.); Canada (Competition Act, Director of Investigation and Research) v. Imperial Oil Limited, [1994] C.C.T.D. No. 23 (QL); Nova Scotia (Attorney General) v. Ultramar Canada Inc., [1995] 3 F.C. 713 (1995), 127 D.L.R. (4th) 517; 63 C.P.R. (3d) 161 (T.D.).
DISTINGUISHED:
Bialski v. National Research Council of Canada (1994), 81 F.T.R. 98 (F.C.T.D.).
REFERRED TO:
Canada (Director of Investigation and Research, Competition Act) v. Imperial Oil Limited, [1990] C.C.T.D. No. 3 (QL).
APPLICATION for an order pursuant to subsection 18.1(2) of the Federal Court Act for an extension of time to file an application for judicial review. Application dismissed.
COUNSEL:
Kimberly H. W. Turner for applicant.
Michael F. Donovan for respondent—Director of Investigation and Research, Bureau of Competition Policy.
Michael S. Koch for respondent—Ultramar Canada Inc.
SOLICITORS:
Pink Breen Larkin, Halifax, for applicant.
Deputy Attorney General of Canada for respondent—Director of Investigation and Research, Bureau of Competition Policy.
Smith, Lyons, Torrance, Stevenson & Mayer, Toronto, for respondent—Ultramar Canada Inc.
The following are the reasons for order rendered in English by
MacKay J.: This is an application by Atlantic Oil Workers Union, Local 1, (the applicant or the Union) for an order pursuant to subsection 18.1(2) of the Federal Court Act, R.S.C., 1985, c. F-7, [as enacted by S.C. 1990, c. 8, s. 5] (the Act), for an extension of time to file an application for judicial review. If permitted, the Union seeks review and an order setting aside a decision of the respondent Director of Investigation and Research, Bureau of Competition Policy (the Director), made December 14, 1995.
By that decision the Director determined that the respondent Ultramar had complied with undertakings provided to the Director on October 25, 1993 in that it had established to the Director’s satisfaction that Ultramar had sought to publicly market its oil refinery at Dartmouth, Nova Scotia without unreasonable restriction on the price and that there was no legitimate expression of interest to purchase the refinery and continue its operation. That decision the Union would seek to have set aside by commencing proceedings for judicial review.
Under subsection 18.1(2) of the Act:
18.1 …
(2) An application for judicial review in respect of a decision or order of a federal board, commission or other tribunal shall be made within thirty days after the time the decision or order was first communicated by the federal board, commission or other tribunal to … the party directly affected thereby, or within such further time as a judge of the Trial Division may, either before or after the expiration of those thirty days, fix or allow.
No application was made within thirty days because, as a solicitor for the applicant candidly acknowledges by affidavit, he misunderstood how the thirty-day time limit for filing would be applied in light of Christmas holidays at the end of the year. The Union, which intended to commence proceedings in timely fashion, did not do so, simply because of his misunderstanding.
The applicant did file on January 25, 1996 an application for judicial review, dated January 5, 1996, in Court file T-208-96 and in the originating notice of motion set out grounds for judicial review, presuming the matter would be permitted to proceed. Counsel for the respondent Ultramar took the position that the application was filed out of time. The Union then filed this separate application for leave to proceed, pursuant to subsection 18.1(2) of the Act, and on the same date, February 2, 1996, it filed a notice of discontinuance with respect to the application in file T-208-96. The application for an extension of time, dated and filed February 2, 1996 was heard in Halifax on February 13. In the notice of motion applying to extend the time, the grounds for it are said to be, “that such extensions of time are permitted pursuant to section 18.1(2) of the Federal Court Act and that the granting of an extension is appropriate in the circumstances of this case”.
The motion for an extension of time came on for hearing on February 13, 1996 when counsel for the applicant and for the respondent Ultramar were heard. Counsel for the Director was in attendance but the Director took no position in relation to the application. Following the hearing counsel for the Union and for the respondent Ultramar filed written submissions in regard to issues raised at the time of hearing. After consideration of submissions made at the hearing and in writing thereafter in March, an order now issues dismissing the application for an extension of time to commence proceedings for judicial review. These are brief reasons for that order.
The general principles applicable in considering an extension of the time limit to file an application have been accepted as those set out in Grewal v. Minister of Employment and Immigration, [1985] 2 F.C. 263(C.A.). Although that case dealt with then subsection 28(2) of the Act [R.S.C. 1970 (2nd Supp.), c. 10], the wording of that provision was similar to that now found in subsection 18.1(2). In that case, Thurlow C.J. speaking for the Court of Appeal stated, in part (at pages 272 and 277):
The underlying consideration, … is whether, in the circumstances presented, to do justice between the parties calls for the grant of the extension.
…
Among the matters to be taken into account … is whether the applicant intended within the 10-day period to bring the application and had that intention continuously thereafter. Any abandonment of that intention, any laxity or failure of the applicant to pursue it as diligently as could reasonably be expected of him could but militate strongly against his case for an extension. The length of the period for which an extension is required and whether any and what prejudice to an opposing party will result from an extension being granted are also relevant.
Counsel for the Union refers to Bialski v. National Research Council of Canada (1994), 81 F.T.R. 98 (F.C.T.D.), where counsel for the applicant had a similar misunderstanding, about the determination of the time limit for filing for judicial review pursuant to section 18.1 of the Act, to that of counsel for the Union in this case. In Bialski, my colleague Madam Justice Reed, allowed an extension of time, finding that the applicant had a reasonable explanation for delay and raised an arguable case. In that case the respondent opposed the extension of time, apparently on a jurisdictional argument that the decision there in question was not one made by a federal board, commission or tribunal in furtherance of a power specifically conferred by law. That argument was not accepted by her Ladyship, and there was no argument or discussion about the arguable case raised by the applicant or his prospects of success in the proceedings sought to be initiated.
In this case, the respondent Ultramar concedes that the applicant intended to bring the application in timely fashion and had not abandoned that intent. Ultramar does not contest the reasonableness of the explanation for the Union’s failure to initiate proceedings in time. It accepts that the decision of the Director in the ordinary course would be subject to judicial review. Ultramar does argue, however, that the Union has failed to demonstrate that it has a reasonable chance of success in an arguable case for judicial review of the Director’s decision. That test, so expressed, is one set out in a decision of this Court in LeBlanc v. National Bank of Canada, [1994] 1 F.C. 81(T.D.), at page 92:
While this Court, in considering an extension of time, must not weigh finally the merits of the applicant’s case, the jurisprudence is clear that it must be persuaded the applicant has a reasonable chance of success in an arguable case.
Whether the test as there expressed would be recognized by the Court of Appeal has yet to be determined. I note for the record that in this case both the applicant and the respondent Ultramar accept that description of the test for purposes of this case. I also note that in some recent decisions of my colleagues the test is expressed somewhat differently, that the applicant must establish a reasonable chance of success, an arguable case, for the Court to grant an extension of time. While in practical terms there may be little difference, the latter expression may more accurately portray current jurisprudence.
In LeBlanc, after reviewing the evidence before me, I concluded that the applicant there had not demonstrated by evidence a reasonable chance of success and I did not allow an extension of time. Here the argument of the respondent Ultramar is based upon its submission that the materials submitted to the Court at the time the motion was heard and the Union’s subsequent written submissions do not demonstrate a reasonable chance of success in an arguable case for judicial review.
The respondent also suggested that if the application for an extension of time to file were permitted it would be prejudiced by having to respond to that application, which would be a third response in legal proceedings relating to the refinery, and these proceedings, in part, raise similar issues to those already disposed of previously. That submission would have significance only if it is determined that there is no reasonable chance of success for the applicant if proceedings for judicial review were to commence. If there is a prospect for success for the applicant, the only prejudice to the respondent Ultramar would be costs of the proceedings and, in my view, any risk of costs is not prejudice to the respondent if the applicant has a reasonable prospect of success. Moreover, I agree with the applicant that granting an extension of time to file constitutes no real prejudice to Ultramar for it would be in no worse position than if the application had been filed on time.
It may be helpful to set out some of the background leading up to the decision of the Director which gives rise to the submissions of the parties about whether there is a reasonable chance of success for the Union if it is permitted to proceed.
The applicant, Atlantic Oil Workers Union, Local 1, represents employees of the refinery formerly operated in Eastern Passage at Dartmouth, Nova Scotia, by the respondent Ultramar Canada Inc. That corporation acquired the refinery following a consent order of the Competition Tribunal dated February 6, 1990 [Canada (Director of Investigation and Research, Competition Act) v. Imperial Oil Limited, [1990] C.C.T.D. No. 3 (QL)], which required that Imperial Oil Limited, the former operator, divest itself of certain assets in the Atlantic Region, including the refinery at Eastern Passage. The order authorized the Director to approve acquisition of the refinery and other assets, subject to general terms set out in the Tribunal’s order.
Ultramar’s acquisition of the refinery was subsequently approved upon certain written undertakings which it gave in September 1990 to the respondent Director, including an undertaking that it would operate the refinery for a minimum of seven years barring a material adverse change. Subsequently, on October 25, 1993 Ultramar also undertook in writing that if it were to notify the Director of its intention to cease operating the refinery before the end of the seven-year term, it would offer the refinery for sale without unreasonable restriction on the price and would provide the Director with evidence establishing whether there was any reasonable legitimate continuing interest on the part of a viable party to maintain the refinery as an operating business in Canada. The October 1993 undertakings provided that Ultramar would be in compliance if it established to the Director’s satisfaction that it had publicly marketed the refinery, without unreasonable restriction on the price and that there was no legitimate expression of interest to purchase and continue operations of the refinery.
In May 1994 Ultramar gave notice of its conclusion that there had been a material adverse change and that it intended to cease operations at the refinery. The Union sought to raise issues concerning that decision before the Competition Tribunal, but the Tribunal held that it had no jurisdiction in the matter. (See: Canada (Competition Act, Director of Investigation and Research) v. Imperial Oil Limited, [1994] C.C.T.D. No. 23 (QL), reasons for decision regarding jurisdiction over undertakings, per Rothstein J.) In September 1994, the Attorney General of Nova Scotia, on behalf of the Province, filed an application in this Court seeking an order to prohibit the Director from determining whether there had been a material adverse change. When Ultramar closed the refinery in October 1994 the Province filed a second application for judicial review in this Court for an order to require the Director to compel Ultramar to continue the refinery operations. Both applications were heard together early in 1995 and both were dismissed by orders dated August 31, 1995 [Nova Scotia (Attorney General) v. Ultramar Canada Inc., [1995] 3 F.C. 713(T.D.)].
Thereafter, in October 1995, the Director determined that there had been a material adverse change under the 1990 undertakings of Ultramar. He then accepted submissions with respect to Ultramar’s compliance with the October 1993 undertakings. The Union made submissions orally and in writing to the Director on this matter, submitting that Ultramar had failed to comply with those undertakings. Then on December 14, 1995 the Director issued a decision finding Ultramar had complied with the October 1993 undertakings. That, of course, is the decision the Union seeks to have reviewed, and set aside, if this application for an extension of time to commence proceedings were to be allowed.
The merits of the applicant’s claims for relief by judicial review, if permitted to proceed by filing its application late, are not to be determined in any final sense at this stage but an appreciation of them is necessary to determine, where the matter is disputed as it is in this case, whether the applicant has established a reasonable chance of success, an arguable case.
There is an initial difficulty in that the grounds for relief are not set out in full by the applicant in its application for an extension of time which simply provides:
The grounds of the motion are that such extensions of time are permitted pursuant to section 18.1(2) of the Federal Court Act and that the granting of an extension is appropriate in the circumstances of this case.
The affidavit in support of the application, sworn and filed February 2, 1996, by Mr. Roberts, a solicitor for the Union, makes reference to the grounds for relief only in the following terms:
12. I have advised the Atlantic Oil Workers Union, Local 1, that the Director of Investigation and Research committed a reviewable error and exceeded his jurisdiction in his decision of December 14, 1995, by applying a definition of the “Eastern Passage Refinery” which was different from that applied by the Competition Tribunal.
…
26. I believe the application of the Atlantic Oil Workers Union, Local 1, raises an arguable issue and has a reasonable chance of success on its merits.
I propose to treat this alleged excess of jurisdiction, said to arise from application of a definition of the refinery different from that earlier applied by the Competition Tribunal, as the primary ground for seeking judicial review.
Other grounds, unsupported by direct reference in affidavit evidence, are here argued, and since they are dealt with by the parties in oral or written argument, I propose to deal with them also. Two additional grounds are set out in the plaintiff’s written submissions dated February 13, 1996 and were referred to at the hearing of this application on that day, and they were included in the applicant’s originating notice of motion in Court file T-208-96, which was withdrawn. They were also among matters included within written representations made to the Director on behalf of the Union in advance of his decision, a copy of which appears as Exhibit D to the Roberts’ affidavit and they are further elaborated on in written submissions dated March 5, 1996, from the applicant in support of this application for an extension of time. Those two grounds are that the Director exceeded his jurisdiction in finding that the respondent Ultramar had offered the refinery for sale “without unreasonable restriction on the price”, as required by its 1993 undertaking, and also in finding that there was no legitimate continuing interest on the part of a potential purchaser to purchase the refinery and continue its operation. Finally, a third additional ground is suggested in the applicant’s written submissions of March 5, 1996, that is, it is submitted the Director breached his duty of fairness in the process in reaching his decision that the respondent Ultramar had complied with its 1993 undertaking, without having provided all the material before him to the applicant, with an opportunity for the latter to review that material, before the Director made his decision.
I do not propose to consider the final ground suggested, i.e., failure to produce all of the evidence to the Union in advance of his decision. It is not referred to in the application for an extension of time, in the affidavit of Mr. Roberts or the exhibits filed with it. There is no indication in any of the evidentiary material before me that the applicant Union, which made both written and oral submissions to the Director before he rendered his decision, ever requested at any time an opportunity to review all of the material before the Director, and thus there is no evidence of any refusal on his part to provide information of any kind. Moreover, the suggestion presumes a right of the applicant to review all information before the Director, a right that is not here established. In an earlier decision, concerning judicial review to preclude the decision of the Director with regard to the 1990 undertakings by Ultramar, a similar issue was raised by the applicant, the Province of Nova Scotia, and supported by the Union. I there found that the Director, in exercising of his administrative discretion under the enabling statute was free to devise processes for dealing with issues arising in regard to that discretion. (See: Nova Scotia (Attorney General) v. Ultramar Canada Inc., [1995] 3 F.C. 713(T.D.).) In keeping with that decision, I would not here infer a legal duty on the Director to produce to any or all interested parties all of the evidence before him, for its or their comment, before his decision.
In light of these considerations the suggestion of a lack of fairness in the process here followed by the Director, is not properly before the Court as a ground for judicial review. Even if it were, in my opinion it would not raise a reasonable chance of success in proceedings by the applicant for judicial review of the Director’s decision here questioned.
Before turning to assess the possibility of success of the applicant in regard to the other grounds it urges for judicial review, it is useful to set out relevant portions of Ultramar’s October 1993 undertakings, and of the Director’s decision that those undertakings were met. It is also useful to refer briefly to the standard to be met in an application for judicial review in this case.
By its letter of October 25, 1993 to the Director, Ultramar made “further undertakings to the Director in respect to the acquisition by Ultramar Canada Inc. of the Texaco Canada Atlantic Assets from Imperial Oil Limited”, and the respondent corporation stated in part:
This letter serves to confirm that in the event that Ultramar Canada Inc., as required by the undertakings of September 24, 1990, provides notice to the Director respecting any action which will adversely affect the operation of the refinery, more particularly notifying the Director of its intention to cease operation of the refinery prior to the expiry of the seven year term provided for in the undertakings of September 24, 1990, Ultramar will, after having reviewed this matter with the Director, provide to the Director evidence establishing whether there is any reasonable, legitimate continuing interest on the part of a viable party in maintaining the refinery as an operating business in Canada. It will be sufficient to satisfy this undertaking if Ultramar establishes, to the Director’s satisfaction, that it has publicly marketed the refinery, without unreasonable restriction on the price, and there is no legitimate expression of interest to purchase the refinery and continue its operation.
By his letter of December 14, 1995, addressed to Ultramar and circulated to other interested parties including the applicant Union, the Director set out his decision in part as follows:
I have now considered the issue of whether Ultramar has complied with its obligation from the 1993 undertaking to establish whether there is any interest in continuing operation of the refinery in Canada. In examining this issue I have considered the submissions made by Ultramar, as well as submissions received from the Atlantic Oil Workers’ Union and from Scotia Synfuels Limited. I have also obtained the advice of an industry expert, Mr. K. Brown.
The available information indicates that Ultramar carried out a public marketing campaign offering for sale the refinery processing units and indicating that it would make available to the purchaser necessary capacity at the terminal and access to the dock for operation of the refinery on commercial terms. Ultramar placed terms on the sale requiring that the purchaser take the refinery on an “as is, where is” basis, meaning that the purchaser would have to perform the required turnaround, and provide an acceptable indemnity to Ultramar against environmental liability at the site. Ultramar did not place any asking price on the assets, indicating that it would consider any bids. An information package was available to interested potential purchasers and a data room was established for purchasers to examined [sic] detailed information on the refinery.
The marketing campaign did not elicit a significant number of potential purchasers. There were only four visitors to the data room and only three expressions of interest, two of which are no longer active. The remaining interest is that of Scotia Synfuels Limited, which is discussed below.
Submissions by interested parties have argued that Ultramar’s offer of only the refining processing units is not an adequate package of assets to comply with its undertakings. These submissions take the position that sale of the refinery should include the terminal and dock facilities, as was the case in the 1990 sale to Ultramar. They also argue that Ultramar’s sales efforts have been inadequate, particularly its refusal to set a price for and offer the entire facility until the final discussions between Ultramar and Scotia. They also claim the asking price, when finally set, was unreasonable.
Having considered all the submissions, I am of the view that the asset package was adequate. There is precendent [sic] in the petroleum industry for purchases of refining facilities without title to required terminal and dock space. Use of the facilities can be and has been determined through commercial arrangements short of ownership.
With respect to the marketing campaign conducted by Ultramar, it is clear that potential purchasers were made aware of the sale and the terms. The sale was advertised in appropriate newspapers and industry journals. The information package was distributed to in excess of 100 potential purchasers and the sale was made directly known to over 200 potential purchasers. The available information makes it clear that all known likely purchasers of the refinery were made aware of the sale.
As noted above, only four parties visited the data room and the only continuing interest in purchasing assets is that expressed by Scotia Synfuels Limited. Scotia’s offer is for the refinery processing units plus the terminal and dock facilities. The offer is for a price below what Ultramar considers acceptable for the entire asset package and contains terms which Ultramar deems to be unacceptable. In particular, the offer prescribes that Ultramar perform the required turnaround or accept a lower price if Scotia performs the turnaround. Moreover, the offer places specific ceilings on Scotia’s liability for costs of the required turnaround and future environmental liability.
In my view, the interest expressed by Scotia Synfuels, falls short of the requirements of the undertakings…. On balance, I do not consider the interest expressed by Scotia to be a legitimate interest for the continued operation of the refinery as a business in Canada.
On the basis of the available information, I am of the view that Ultramar has complied with its 1993 undertakings to publicly market the refinery without unreasonable restriction on the price and there is no legitimate expression of interest to purchase the refinery and continue its operation.
In considering the prospects for success in relation to any of the grounds set out for judicial review it is necessary to bear in mind the standard of review that applies in the circumstances of this case.
The function of the Director here questioned, it is agreed by the parties, is an administrative discretionary function, as a part of his role in investigating business activities and enforcing competition policy. That is a special function of an officer with particular expertise and responsibilities, within the scope of discretion vested by statute. It involves, in this case, the determination of facts and the consideration of the application of Ultramar’s undertakings to those facts. In that task this Court would be reluctant to intervene unless it were persuaded, not merely that the decisions of the Director were unreasonable in the sense that the Court might have reached a different conclusion on the evidence before the Director, but that the decisions were patently unreasonable in the sense that they were not based on any evidence or relevant legal principle. Particularly is this so where the decisions cannot be said to be in relation to the Director’s jurisdiction, but rather they concern matters clearly falling within his or her discretion to determine, under his or her statutory authority and the terms of the arrangements the Director had earlier approved for Ultramar’s acquisition of the refinery, including its written undertakings.
In Maple Lodge Farms Ltd. v. Government of Canada, [1982] 2 S.C.R. 2, at pages 7-8, Mr. Justice McIntyre, speaking for the Court commented:
It is, as well, a clearly-established rule that the courts should not interfere with the exercise of a discretion by a statutory authority merely because the court might have exercised the discretion in a different manner had it been charged with that responsibility. Where the statutory discretion has been exercised in good faith and, where required, in accordance with the principles of natural justice, and where reliance has not been placed upon considerations irrelevant or extraneous to the statutory purpose, the courts should not interfere.
In Gingras v. Canada, [1990] 2 F.C. 68(T.D.), at page 88, my colleague Mr. Justice Dubé summed up Canadian jurisprudence concerning the test applicable in review of a discretionary administrative decision in the following terms.
Canadian courts at all levels have repeatedly reaffirmed the interdependent criteria set forth in Padfield. Like the House of Lords, they also have concluded that an administrative authority misuses its power when it acts for improper ends, other than those specified in the Act, or based on wrong principles or with reference to factors unrelated to the law and irrelevant, by failing to take relevant factors into account or in an arbitrary, unreasonable or discriminatory manner. [Citations omitted.]
Those cases express in terms common in review of administrative decisions particular examples of circumstances that may be generically described as patently unreasonable, the standard required to be established to warrant intervention of the Court on the grounds here alleged.
The primary ground upon which judicial review would be sought is expressed in the applicant’s written submissions of March 5, 1996 (at page 25), thus:
… the Director erred when he accepted a revised definition of “refinery” contrary to the understanding of all parties and the February 6, 1990 Consent Order of the Competition Tribunal. The Respondent Ultramar could not have complied with the September 25, 1993 undertaking when it offered only part of the refinery for sale. The Director further erred when he took into account irrelevant considerations such as industry practice with respect to the sale of refineries, rather than the express terms of the September 25, 1993 undertaking.
In essence the argument is that since the Competition Tribunal’s consent order in February 1990 described the refinery, as including the refinery and related dock and terminal facilities with storage capacity, the Director erred in finding compliance by Ultramar with its 1993 undertakings to publicly market the refinery when it failed to include the dock and terminal and related storage capacity in the package which it offered for sale as the refinery.
Submissions on behalf of Ultramar urge that the Union’s allegation, that the Director failed to apply the definition of the refinery as set out in the 1990 consent order of the Tribunal, is not borne out by examination of the decision. That indicated the Director took account of submissions of interested parties that “sale of the refinery should include terminal and dock facilities, as was the case in the 1990 sale to Ultramar”, but the decision noted, however, that he was satisfied that the asset package offered was adequate. The Director also notes in his decision, describing the public marketing campaign of the refinery, that Ultramar offered for sale “the refinery processing units … indicating that it would make available to the purchaser necessary capacity at the terminal and access to the dock for operation of the refinery on commercial terms”. In my view, the Union was not in error in assuming the entire refinery as described in the 1990 consent order was not offered for sale by Ultramar. While there was some discussion of purchase of the entire refinery and terminal, with Scotia Synfuels in October 1995, it seems clear to me that the Director’s decision sets out that Ultramar’s marketing effort prior to that was related to the processing facilities, excluding the dock and terminal.
Nevertheless, the Union’s argument on its primary ground for judicial review would be dependant upon finding that the Director was bound to accept the description of the Eastern Passage refinery set out in the 1990 consent order in his assessment of whether Ultramar had met its undertakings. In submissions of March 5, 1996 on behalf of the Union it is urged:
… the director completely ignored the definition of refinery which all parties to the Consent Order of the Competition Tribunal, and Ultramar as the eventual purchaser pursuant to that order, operated under. While the Applicant recognizes that the undertakings are not part of the Consent Order, but for the Consent Order no undertakings would have been made. The Director gains his authority for the undertakings from the terms of the Consent Order. The definition of “refinery” contained in the Consent Order governs the determination of whether the Respondent Ultramar complied with the September 25, 1993 undertaking.
In my opinion, this ground urged by the Union has no reasonable chance of success if argument were to be made in full in proceedings for judicial review. As counsel for Ultramar points out there are already two decisions, one by the Competition Tribunal and one by this Court which have found that the undertakings by Ultramar to the Director were not a part of the consent order of 1990, and the terms of the consent order, while providing a general framework for the Director’s discretion within authority vested in him by the Competition Act [R.S.C., 1985, c. C-34], were not the source of his authority in relation to the undertakings given by Ultramar. The source of his authority in that regard was the enabling statute and the undertakings themselves. (See: Canada (Competition Act, Director of Investigation and Research) v. Imperial Oil Limited, supra; and Nova Scotia (Attorney General) v. Ultramar Canada Inc., supra, at pages 746-750.)
In my opinion, the applicant’s argument, that the description of the refinery as set out in the consent order is binding on the Director in assessing Ultramar’s compliance with its undertakings, relies on an implication that the Director’s authority in relation to the undertakings derives from the consent order. Since that perception has already been rejected twice, I see no reasonable chance of success if the argument were to be heard again.
The Union further argues that the Director exceeded his jurisdiction by taking into account irrelevant considerations of industry practice in assessing whether the asset package offered for sale as the refinery by Ultramar was adequate. The argument is in large part interrelated with the perception that Ultramar’s 1993 undertakings, and the Director’s assessment of compliance with them, required that the refinery marketed by Ultramar be as it was described in the 1990 consent order. If, as I see it, that is not a requirement, there can be little argument that the industry practice is irrelevant.
Moreover, as I set out in Nova Scotia (Attorney General) v. Ultramar Canada Inc., supra, at page 750, by their nature the undertakings given by Ultramar in 1990 and 1993 were made to the Director and specifically agreed to be a contract between them. The undertakings play a particular role in the arrangements here made but ultimately they may be questioned or enforced only by one of the two parties to them, the Director and Ultramar. Where they are agreed on their interpretation, a different interpretation offered by others, though they be vitally interested in the matter, cannot be given credence by the Court except perhaps in most extraordinary circumstances, and none are here suggested.
I am not persuaded that the applicant can establish that the decision of the Director, in assessing the asset package offered for sale as the refinery by Ultramar in light of the latter’s 1993 undertakings, was patently unreasonable. Thus, I consider the applicant has no reasonable chance of success in arguing this ground for judicial review.
As a further ground for judicial review, as set out in the application in Court file T-208-96 which was withdrawn, and in its written submissions of March 5, 1996, the Union urges the Director erred when he found Ultramar had complied with its undertaking to publicly market the refinery without any unreasonable restriction on the price.
The basis of the error alleged is the Union’s view that Ultramar, by failing to indicate the price for which it was willing to sell the refinery, unreasonably restricted the price by refusing to disclose it completely. That argument was addressed to the Director in the Union’s written submissions before his decision was made but it is now said that he did not address that submission, and he erred in the decision that he did make.
I am not persuaded that the Director can be said to have overlooked this submission. In his decision he does refer to the submissions made by the Union, among others, though not specifically to this particular submission. His decision also includes the following references:
Ultramar did not place any asking price on the assets, indicating that it would consider any bids ….
…
They [interested parties] also argue that Ultramar’s sales efforts have been inadequate, particularly its refusal to set a price for and offer the entire facility until the final discussions between Ultramar and Scotia ….
I infer that the Director was aware of this issue raised by the Union. The fact that he did not address it in his decision is not in itself a basis on which the Court would here intervene for there is no evidence or argument offered that would support a conclusion that the Director’s decision is patently unreasonable in regard to this aspect of Ultramar’s sales efforts and its undertakings, that is, that the refinery was offered for sale without unreasonable restriction on the price. Failure to set an asking price, in itself, cannot be characterized as unreasonably restricting the price, in my opinion, unless there be some general pattern that setting an asking price is a norm in selling refineries, or that failure to set the price unduly restricted interested buyers in the market, or some other factor that may be seen to have an adverse effect to be assessed as unreasonable. There is no evidence of either of those examples, or of any other basis, that would support a conclusion that the Director, in exercise of his discretion, was patently unreasonable.
Finally, the applicant urges that the Director erred in concluding there was no legitimate expression of interest to purchase the refinery and continue its operation.
The Director’s decision review’s Ultramar’s marketing effort and the interest generated in purchase of the refinery. He concluded that it was “clear that all known likely purchasers of the refinery were made aware of the sale”, and no dispute arises about that conclusion. Yet, ultimately there was only one possible purchaser, Scotia Synfuels Limited, that expressed any serious interest. Its interest, and the terms upon which it was advanced, are discussed in the Director’s decision. After summarizing his reasons, the decision sets out his conclusion that “On balance, I do not consider the interest expressed by Scotia to be a legitimate interest for the continued operation of the refinery as a business in Canada”, and further, that he was of the view that “there is no legitimate expression of interest to purchase the refinery and continue its operation”.
The principal basis of the Union’s argument that this conclusion was an error is that the asking price indicated by Ultramar late in the process was unreasonable and the Director failed to assess whether that price “was reasonable in and of itself, rather than focusing on the alleged shortcomings of the offer by Scotia Synfuels”. For the Union it is urged that the Ultramar asking price was unreasonable in that it was based on replacement cost of an operating refinery; here the refinery was not operating, a factor that, it is suggested, ought to be reflected in a lower cost in light of considerable turnaround work and money required for the refinery to be a viable operation. Yet when one examines the reasons set out by the Director for concluding that there was no legitimate interest in continued operation of the refinery (which are not here reproduced), he does refer to turnaround costs, to environmental liability upon which Scotia Synfuels would limit its commitments, to Scotia’s failure to agree to purchase on an “as is, where is” basis and other factors in support of his conclusion. I am not persuaded that his assessment of factors of significance in the bargaining over price for the refinery, between Scotia Synfuels and Ultramar, is any less appropriate than that which the Union would have him adopt. In short, it seems to me that in this respect at least, the Director’s decision, one made in the exercise of his administrative discretion, cannot be said to be unreasonable, let alone patently unreasonable. The decision cannot be said to be made without some supporting reasons or evidence. How those reasons or that evidence is to be weighed in the decision is clearly within the Director’s discretion.
Conclusion
My conclusion is that the application for an extension of time to file the Union’s application for judicial review should be dismissed. I am not persuaded that, if permitted to proceed, the applicant would have a reasonable chance of success in persuading the Court to intervene since, in my opinion, there is no likelihood that the Court would be so persuaded, with reference to any of the grounds suggested, that the Director, in the exercise of his administrative discretion, was patently unreasonable in his assessment that Ultramar had complied with the undertakings of September 1993.
The applicant may sense at first blush that this decision conflicts with the general standard earlier set out as described by Thurlow C.J. in Grewal, supra, that is, the underlying consideration in a case such as this is whether in the circumstances an extension of time to commence proceedings is called for to do justice between the parties. In my opinion, that does not require that the Court waive the basic statutory rule limiting time to commence proceedings where the Court concludes the applicant, on the basis of the material and argument presented in support of the extension, has no reasonable chance of success, no arguable case, for judicial review. In so concluding, the applicant’s evidence is essentially accepted as established, but when considered in light of what must be established in law to warrant relief, the applicant has no reasonable chance of success in an arguable case.
Where the Court so concludes, its responsibility, in the interests of justice between the parties, is to so say and to refuse an application for an extension of time. That responsibility is not easy. An applicant may well believe that, right or wrong, it is entitled to its day in court, to be heard in full in its argument. Yet if I am right, justice is now served, the uncertainty about possible revival of operations at the Eastern Passage refinery is now terminated, not favourably perhaps for the members of the applicant Union, but at least so that they can put behind them the possibilities of judicial intervention in support of their ultimate goal, to return to work at the refinery. If that goal is to be achieved it will be as a result of decisions of others, not of the courts.
Counsel for the applicant Union who made the error in calculating the time to file an application for judicial review may well be unhappy, but unless my decision is found to be in error it may ultimately be perceived as serving the long-term interests of the applicant that judicial review proceedings, with no reasonable prospect of success, did not proceed.
In the normal course no provision for costs is made in relation to an application for judicial review, in accord with Rule 1618 [Federal Court Rules, C.R.C., c. 663 (as enacted by SOR/92-43, s. 19)]. In this application for an extension of time to commence judicial review proceedings, it seems to me appropriate, particularly in the circumstances of this case, that each party bear its own costs. The order dismissing the application so provides.