Judgments

Decision Information

Decision Content

A-470-81
In the matter of an application by the Province of Nova Scotia for an interim ex parte order pursu ant to section 59 of the National Transportation Act, R.S.C. 1970, c. N-17, forbidding any coordi nation of container shipping services until there has been compliance with section 27 of the Act
and
In the matter of an appeal to the Federal Court of Appeal pursuant to section 64, subsection (2), of the National Transportation Act, R.S.C. 1970, c. N-17
Court of Appeal, Thurlow C.J., Ryan J. and Kerr D.J.—Ottawa, September 14 and 15, 1981.
Transportation — Appeal from a decision of the Water Transport Committee dismissing an application for an interim order forbidding further action on the coordination of contain- erized freight shipping services — Section 27 provides that the Commission may disallow the acquisition of a transportation business — Section 59 empowers the Commission to grant interim relief by forbidding anything to be done that the Commission would be empowered to forbid on application, notice and hearing — Section 23 provides that the Commission may make such order as it considers proper upon finding that the acts of the carrier are prejudicial to the public interest — Whether the Committee erred in holding that it lacked the jurisdiction to issue the order requested — Appeal dismissed — National Transportation Act, R.S.C. 1970, c. N-17, as amended, ss. 21, 23, 27, 59, 64(2) — Interpretation Act, R.S.C. 1970, c. I-23, s. 11.
Appeal from a decision of the Water Transport Committee dismissing an ex parte application for an interim order forbid ding anything to be done to further the St. Lawrence River coordination of containerized freight shipping services. The Committee held that it did not have the legal power to issue an interim prohibition order. Section 27 of the National Trans portation Act provides that the Commission may disallow the acquisition of a transportation business if such acquisition will unduly restrict competition or be prejudicial to the public interest. Section 59 empowers the Commission to grant interim relief by forbidding anything to be done that the Commission would be empowered to forbid on application, notice and hearing. Section 23 provides that the Commission may make such order that it considers proper upon finding that the acts or omissions of a carrier are prejudicial to the public interest. The appellant submits that the word "forbid" in section 59 falls within the meaning of "disallow" in section 27. It also submits that the Committee had power under section 23 to make an order of the kind requested, and thus could make such an order on an interim basis under section 59. The respondents submit that section 59 applies only to proceedings before the Commis-
sion in which procedure by application, notice and hearing is prescribed by the Act. The issue is whether the Committee erred in holding that it did not have jurisdiction to issue the order requested.
Held, the appeal is dismissed. Section 59 does not authorize an interim order in matters arising under section 27. The power to disallow conferred by section 27 does not include a power to "forbid" or enjoin. The consequence of disallowance is pre scribed by subsection 27(4). It is that the acquisition is void. The power to grant an injunction with respect to it is not included and if such a power is not included in the power that may be exercised after the investigation, it is not exercisable on an interim basis under section 59. What the Committee appears to have said is not that it had no power under section 59, but that it had no power to grant the order forbidding the carriers to do anything to further the proposed service, rather than an order relating to the acquisition arrangements between the carriers. There is no reason to doubt the correctness of the Commission's order. There was nothing in the application before the Commission to invoke section 23 or to make out a case for relief under it. In order to exercise on an interim basis under section 59 powers conferred by section 23, there must be an application invoking section 23 and establishing, at least prima facie, a situation to which section 23 might apply. This is implicit in the wording at the end of section 59 which provides that no interim order shall be made for any longer time than the Commission may deem necessary "to enable the matter to be heard and determined".
APPEAL. COUNSEL:
G. Evans for the Attorney General of Nova
Scotia.
D. Murphy for the Canadian Transport
Commission.
P. R. O'Brien for Manchester Liners Ltd.
M. P. J. Rusko, Q.C. for Dart Containerline
Canada M.V.
D. W. Flicker for Canadian Pacific Limited.
SOLICITORS:
Department of the Attorney General of Nova Scotia for the Attorney General of Nova Scotia.
G. W. Nadeau, Q.C. % Canadian Transport Commission, Legal Services, Hull, for the Canadian Transport Commission.
Stikeman, Elliott, Tamaki, Mercier & Robb, Montreal, for Manchester Liners Ltd.
M. P. J. Rusko, Q.C., Montreal, for Dart Containerline Canada M.V.
Canadian Pacific Ltd., Legal Services, Mon- treal, for Canadian Pacific Limited.
The following are the reasons for judgment delivered orally in English by
THURLOW C.J.: This is an appeal under subsec tion 64(2) of the National Transportation Act, R.S.C. 1970, c. N-17, as amended, from a decision of the Water Transport Committee of the Canadi- an Transport Commission pronounced on July 31, 1981, which dismissed an ex parte application brought by the Attorney General of Nova Scotia requesting the Commission to issue
(1) an interim ex parte order requiring the parties to the proposed St. Lawrence River containerized freight coordination service to give notice pursuant to Section 27 of the National Transportation Act.
and
(2) an order forbidding anything to be done to further the so-called St. Lawrence River coordination of containerized freight shipping services until there has been compliance with Section 27 of the National Transportation Act.
Leave was subsequently granted to the Attorney General to appeal to this Court on the following question:
Did the Water Transport Committee err in law and jurisdiction in holding that there was no warrant or authority in the National Transportation Act or in any other Act applicable to Marine Transportation for the issuance by the Committee of an order forbidding anything to be done to further the St. Law- rence River containerized freight coordinated service until there has been compliance with section 27 of the National Transportation Act?
The application made to the Commission was supported only by some thirteen paragraphs of allegations which referred to the direct and sub stantial interest of the citizens of Nova Scotia in the provision of containerized freight services within and through Nova Scotia, to certain pro ceedings which had already been heard by the Committee including the Attorney General's pend ing application for an order requiring Canadian Pacific Steamships Limited to give notice under section 27 of the National Transportation Act of its proposed acquisition of an interest in a joint coordinated container service undertaking with Dart Containerline (Canada) Limited and Man-
chester Liners Limited, to be operated from Mon- treal, commencing in August 1981, and to the claim of the Province of Nova Scotia that a coordi nation of the shipping services offered by Dart, Manchester and CP Steamships would unduly restrict competition in the provision of container shipping services and otherwise damage Canada's intermodal transportation network, thus causing irreparable harm to the Canadian freight transpor tation system. The application referred to and invoked sections 27 and 59 of the Act and asserted the claim of the Province that:
... the proposed coordination of Dart Containerline (Canada) Limited, CP Steamships Limited and Manchester Liners Lim ited, to take place during the month of August, 1981, would cause serious disruption and damage to the eastern Canadian freight transportation network and therefore constitutes special circumstances which require the Canadian Transport Commis sion to take immediate action to prevent further deterioration of the freight transportation system serving the Province.
In dismissing the application the Committee, after referring to the need of an applicant for relief under section 59 to establish special circum stances, said:
But there is another requirement in Section 59 which must be satisfied before the Commission can act. The Order which the Commission may make ex parte and on an interim basis must be an Order which it would be empowered on application, notice and hearing to make. It follows that the power to make the two Orders requested by the Province must be ascertained. Were the Committee to find that the transaction as described by Mr. Romoff amounted to a "proposed acquisition" on the part of Canadian Pacific, or for that matter Dart or Manches- ter Liners, and the notice required by Section 27 was not immediately forthcoming, we think that the Committee could consider issuing an Order under Section 59. However we can find no warrant or authority in the National Transportation Act or any other Act applicable to marine transportation for the issuance by the Committee of an Order forbidding anything to be done to further the St. Lawrence River containerized freight coordination service until there has been compliance with Section 27 of the National Transportation Act. In other words, we find that the Water Transport Committee does not have the legal power to do what the Province is asking. Consequently that branch of the Application which asks for a prohibition Order is dismissed for the reasons given.
Sections 59 and 27 provide:
59. The Commission may, if the special circumstances of any case so require, make an interim ex parte order authorizing,
requiring or forbidding anything to be done that the Commis sion would be empowered, on application, notice and hearing, to authorize, require or forbid; but no such interim order shall be made for any longer time than the Commission may deem necessary to enable the matter to be heard and determined.
27. (1) A railway company, commodity pipeline company, company engaged in water transportation, or person operating a motor vehicle undertaking or an air carrier, to which the legislative jurisdiction of the Parliament of Canada extends, that proposes to acquire, directly or indirectly, an interest, by purchase, lease, merger, consolidation or otherwise, in the business or undertaking of any person whose principal business is transportation, whether or not such business or undertaking is subject to the jurisdiction of Parliament, shall give notice of the proposed acquisition to the Commission.
(2) The Commission shall give or cause to be given such public or other notice of any proposed acquisition referred to in subsection (1) as to it appears to be reasonable in the circum stances, including notice to the Director of Investigation and Research under the Combines Investigation Act.
(3) Any person affected by a proposed acquisition referred to in subsection (1) or any association or other body representing carriers or transportation undertakings affected by such acqui sition may, within such time as may be prescribed by the Commission, object to the Commission against such acquisition on the grounds that it will unduly restrict competition or otherwise be prejudicial to the public interest.
(4) Where objection is made pursuant to subsection (3), the Commission
(a) shall make such investigation, including the holding of public hearings, as in its opinion is necessary or desirable in the public interest;
(b) may disallow any such acquisition if in the opinion of the Commission such acquisition will unduly restrict competition or otherwise be prejudicial to the public interest;
and any such acquisition, to which objection is made within the time limited therefor by the Commission that is disallowed by the Commission, is void.
(5) Nothing in this section shall be construed to authorize any acquisition of an interest in any other company that is prohibited by any Act of the Parliament of Canada.
It will be observed that while section 59 empow ers the Commission to grant interim relief by "authorizing, requiring or forbidding" anything to be done that the Commission would be empowered to authorize, require or forbid on application, notice and hearing, the expressions of what the Commission may order do not include the word "disallow". It will also be observed that in the procedure set out in section 27 the course open to a party affected by a proposed acquisition is not one
of initiating an application for disallowance but one of objecting to the proposed acquisition, after which there may or may not be a public hearing'.
The argument on the appeal focussed attention on these features of the statutory provisions. On behalf of the Attorney General it was submitted that the statute as a whole represented a statutory scheme for regulating the transportation industry, that both section 21 2 of the Act and section 11 of the Interpretation Act, R.S.C. 1970, c. I-23, 3 required that the sections in question should be given a broad construction so as to fill out the regulatory scheme and that the word "forbid" in section 59 falls within the meaning of "disallow" in subsection 27(4). The opposing parties main tained the contrary and further took the position that section 59 applies only to proceedings before the Commission in which procedure by applica tion, notice and hearing is prescribed by the Act. There are instances under the Act and the Acts referred to in it in which such procedure is prescribed.
Notwithstanding the able and comprehensive argument presented by counsel for the Attorney General, I am not persuaded that section 59 authorizes an interim order in matters arising under section 27 or that the power to disallow conferred by that section includes a power to "forbid" or enjoin. The consequence of disallow- ance is prescribed by the subsection. It is that the acquisition is void. I incline to the view that power to grant an injunction with respect to it is not included and if such a power is not included in the power that may be exercised after the investigation
' See Seafarers International Union of Canada v. Canadian National Railway Company [1976] 2 F.C. 369.
2 21. It is the duty of the Commission to perform the functions vested in the Commission by this Act, the Railway Act, the Aeronautics Act and the Transport Act with the object of coordinating and harmonizing the operations of all carriers engaged in transport by railways, water, aircraft, extra-provin cial motor vehicle transport and commodity pipelines; and the Commission shall give to this Act, the Railway Act, the Aeronautics Act and the Transport Act such fair interpretation as will best attain that object.
3 11. Every enactment shall be deemed remedial, and shall be given such fair, large and liberal construction and interpreta tion as best ensures the attainment of its objects.
it is not exercisable on an interim basis under section 59. I am also inclined to think, though I need not reach a concluded opinion on it or on the extent of the meaning of "disallow", that the procedure open to an objector under section 27 is not an "application, notice and hearing" procedure within the meaning of section 59.
As I view the matter there is a narrower ground on which the question raised by the appeal may be answered. It appears from the passage I have cited from the Committee's reasons that the Committee was not persuaded that it did not have power under section 59 to grant interim relief in a matter arising under section 27 and might have granted such relief if (1) it had concluded that the transac tion between the three carriers amounted to a "proposed acquisition" by CP Steamships or the others and (2) the notice required by section 27 was not immediately forthcoming. What the Com mittee appears to me to have said in the sentence that follows is not that it had no power under section 59, but that it had no power to grant the order requested by the Attorney General, that is to say, an order forbidding the carriers to do any thing to further the proposed service, rather than an order relating to the acquisition arrangements between the carriers. In this I see no reason to doubt the correctness of the Committee's view of its power.
A further submission was made by counsel for the Attorney General that the Committee had power under section 23 to make an order of the kind requested and consequently could make such an order on an interim basis under section 59.
Section 23 provides:
23. (1) In this section
"carrier" means any person engaged for hire or reward in transport, to which the legislative authority of the Parliament of Canada extends, by railway, water, aircraft, motor vehicle undertaking or commodity pipeline;
"public interest" includes, without limiting the generality thereof, the public interest as described in section 3.
(2) Where a person has reason to believe
(a) that any act or omission of a carrier or of any two or more carriers, or
(b) that the effect of any rate established by a carrier or carriers pursuant to this Act or the Railway Act after the 19th day of September 1967,
may prejudicially affect the public interest in respect of tolls for, or conditions of, the carriage of traffic within, into or from Canada, such person may apply to the Commission for leave to appeal the act, omission or rate, and the Commission shall, if it is satisfied that a prima facie case has been made, make such investigation of the act, omission or rate and the effect thereof, as in its opinion is warranted.
(3) In conducting an investigation under this section, the Commission shall have regard to all considerations that appear to it to be relevant, including, without limiting the generality of the foregoing,
(a) whether the tolls or conditions specified for the carriage of traffic under the rate so established are such as to create
(i) an unfair disadvantage beyond any disadvantage that may be deemed to be inherent in the location or volume of the traffic, the scale of operation connected therewith or the type of traffic or service involved, or
(ii) an undue obstacle to the interchange of commodities between points in Canada or an unreasonable discourage ment to the development of primary or secondary indus tries or to export trade in or from any region of Canada or to the movement of commodities through Canadian ports; or
(b) whether control by, or the interests of a carrier in, another form of transportation service, or control of a carrier by, or the interest in the carrier of, a company or person engaged in another form of transportation service may be involved.
(4) If the Commission, after a hearing, finds that the act, omission or rate in respect of which the appeal is made is prejudicial to the public interest, the Commission may, not withstanding the fixing of any rate pursuant to section 278 of the Railway Act but having regard to sections 276 and 277 of that Act, make an order requiring the carrier to remove the prejudicial feature in the relevant tolls or conditions specified for the carriage of traffic or such other order as in the circumstances it may consider proper, or it may report thereon to the Governor in Council for any action that is considered appropriate.
It was conceded that there was nothing in the application before the Commission to invoke sec tion 23 or to make out a case for relief under it. But it was contended, as I understood the argu ment, that as a matter of jurisdiction the Commis sion under section 59 could nevertheless exercise on an interim basis the powers that would be open to it to exercise on an application under section 23.
In my opinion in order to exercise on an interim basis under section 59 powers conferred by section 23, there must be an application invoking section 23 and establishing, at least prima facie, a situa tion to which section 23 might apply. I think, moreover, that this is implicit in the wording at the end of section 59 which provides that no interim order shall be made for any longer time than the Commission may deem necessary "to enable the matter to be heard and determined." This appears to me to refer, if a power of the kind conferred by section 23 is to be exercised, to a matter in which section 23 is invoked by the description of a situa tion to which section 23 might apply.
Accordingly I am of the opinion that the ques tion before the Court should be answered in the negative and that this Court should so certify to the Canadian Transport Commission.
Having regard to Rule 1312 no costs should be awarded to any party.
* * *
RYAN J. concurred.
* * *
KERR D.J. concurred.
 You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.