Yatar v TD Insurance Meloche Monnex, 2024 SCC 8 (March 15, 2024)
Category: Partial restrictions on review
Context: I profiled the Court of Appeal for Ontario’s decision in Yatar in Issue #45.
Yatar sought review of a Licence Appeal Tribunal [LAT] adjudicator’s decision denying her application for insurance benefits, because the application was time-barred. She sought reconsideration of the decision, which was dismissed. Under Ontario’s Licence Appeal Tribunal Act, a right of appeal from the LAT relating to a matter under the Insurance Act is limited to questions of law. Yatar pursued an appeal under the right of appeal and filed an application for judicial review of the decision. The Divisional Court held that it should not exercise its discretion to consider judicial review of the mixed-fact and fact questions raised by Yatar, because there were no “exceptional circumstances” warranting judicial review. The Court of Appeal for Ontario held that a limited right of appeal does not preclude judicial review; but that it would only be in “rare” cases that judicial review would be exercised given the legislative scheme at issue.
Issues: (1) Does a limited right of appeal (to questions of law) oust judicial review in these circumstances, or otherwise limit it to “unusual” or “rare” cases?; (2) If judicial review is appropriate in these circumstances, is the decision unreasonable?
Holding: Rowe J wrote for the Court. A right of appeal does not on its own preclude applications for judicial review [3]. The lower courts erred in limiting judicial review to “exceptional” or “rare” cases. In this case, the LAT decision is unreasonable.
Analysis: I have written before that we may not lose much when the Supreme Court denies leave on administrative law cases, given that Court’s tortured history with the field. However, Yatar is a counter-argument: Rowe J’s reasons are minimalistic and tightly-written, a counter-point to less clear reasons for decision offered in some of the Court’s recent administrative law decisions. Yatar’s strength is its minimalism.
Nonetheless, I suspect Yatar will be taken by enterprising litigants to try—one way or another—to decide the underlying problem, not at issue here: is a right of appeal on questions of law constitutionally sufficient, when coupled with limitations barring judicial review on other grounds? This raises the meaning of Crevier v AG of Quebec, [1981] 2 SCR 280, which protected review for “jurisdictional” errors. In my view, Yatar does not directly (or even indirectly) answer this question—not least because, at para 50, Rowe J expressly declines to deal with this problem raised in the Federal Court of Appeal’s cases. That said, Rowe J's decision is a powerful statement of judicial review in this context, which could lead to the conclusion that Yatar is influential.
I will address: (1) the holding of the case and Rowe J’s decision (2) the implications—if any—for the thorny constitutional issue lurking in the background of this case.
The Meaning of Yatar
This case is centred around Vavilov’s cryptic passage at para 52: “…the existence of a circumscribed right of appeal in a statutory right of appeal in a statutory scheme does not on its own preclude applications for judicial review of decision, or aspects of decisions, to which the appeal mechanism does not apply…” It turns out that this passage is not so cryptic after all. Rather, applied to these facts, it means that the right of appeal carries no interpretive presumption that judicial review is ousted. As Rowe J says:
The legislative decision to provide for a right of appeal on questions of law only denotes an intention to subject LAT decisions on questions of law to correctness review. The idea that the LAT should not be subject to judicial review as to questions of facts and mixed facts and law cannot be inferred from this.
As a matter of interpretation, I think this is correct. The legislature’s design choice in Yatar was a right of appeal on questions of law, but it was not accompanied by a clause barring judicial review on fact/mixed fact and law. For that reason, as I wrote in Issue #81 with regards to Smith v The Appeal Commission, 2023 MBCA 23, it is a bridge too far to assume that the right of appeal—again, on its own—has any impact on the constitutionally-protected right of judicial review. As I said in Issue #81:
The legislature can intend that all questions of law proceed by appeal for various reasons, but it might be hazardous and unnecessary to read much further—(ie) to suggest that the legislature also intends to extinguish all judicial review rights absent a clear privative clause…”
In this case, Rowe J notes that “[n]o such inference is warranted” that the right of appeal on its own is a reason not to undertake review [4].
I agree. It is hazardous to read an “implicit” legislative intention into clear legislative wording. Both respondents in this case tried to suggest that legislative intention should be read more broadly, to include policy-laden considerations of judicial economy that caution against judicial review. But the Court’s own interpretive jurisprudence cautions against reading unexpressed policy intentions to make the text say something it does not: see 65302 British Columbia Ltd v Canada, [1999] 3 SCR 804 at para 51. The LAT’s argument—that the “legislative intent in enacting the restrictive appeal clause would be undermined” [38]—reads too much into the legislative choice to enact a right of appeal. It is true, of course, that the LAT process and Insurance Act is a complex regulatory scheme, which judicial review might complicate. But reading the right of appeal to restrict judicial review would essentially take the legislature to have enacted a privative clause alongside the right of appeal. There is no such thing as an invisible privative clause. Where legislatures want to bar review, they do so.
Other reasons favour this interpretation. For one, in Ontario, the legislature has preserved judicial review through statute: see s.2(1) of the Judicial Review Procedure Act. This is a contrary legislative indication that the LAT scheme should not be read, absent clear language, to contradict s.2(1). And as I will note below, reading a privative clause into the legislative scheme would raise significant constitutional problems because it would bar review on some class of questions, a question beyond the scope of this case.
Rowe J’s reasoning also speaks to how judicial review should proceed in the face of the right of appeal. At the Supreme Court, the parties and intervenors’ arguments centred around how a right of appeal fits into the Court’s Strickland v Canada (Attorney General), 2015 SCC 37 framework. But Rowe J gets at the problem from the other way around, by addressing the Strickland test through the prism of first principles. Judicial discretion, guided by the factors in Strickland, cannot fix the fact that a statutory right of appeal on questions of law does not permit resolution of fact and mixed-fact issues [62]. Internal reconsideration, similarly, is not an adequate remedy where the reconsideration is the subject of the review. To say otherwise would permit internal administrative processes—the product of which is the object of the court’s review—to supercede that review function [49].
Implications
The first implication of this case is somewhat obvious—tribunals that previously may have rested easy on the understanding that judicial review would be rare or exceptional when the legislature has provided a right of appeal will have to re-evaluate. A range of fact and mixed-fact-law questions may now be subject to judicial review. Much will depend on the statute at hand and the arrangements that different provinces have set up for their tribunal systems. In the meantime, courts cannot say that rights of appeal on questions of law necessarily satisfy the Strickland test.
A second implication is how far we’ve come since our pre-Vavilov days. No longer do we speak of administrative processes as inherently concerned with expertise, judicial economy, or otherwise—absent legislative language. Instead, we see a rejection of the idea that an administrative process itself can substitute for judicial review in this case—even considering judicial economy.
A third implication concerns the constitutional problem. As I mentioned, Rowe J’s decision did not address the constitutional problem raised by several Federal Court of Appeal decisions (see para 50). For my part, I do not think Yatar can be taken to influence the question of limited restrictions on review—like a limited right of appeal—that channel the review function when coupled with privative clauses.
First, the logic of Yatar rests on the fact that there is no indication of a legislative intent barring review. It would be odd to read Yatar to answer a situation where there is such a bar to review. Relatedly, Yatar’s statement of the importance of judicial review stands alongside statements about the importance of Parliament’s institutional design choices. A privative clause is one such choice that was, oddly, given short shrift in Vavilov, but which seems on the level with a right of appeal. When legislatures speak, we presume they mean something. And so the question of what legislative intent to ascribe to privative clauses—and whether that intent is constitutionally justifiable—is an important countervailing consideration that simply was not addressed in Yatar.
Finally, and perhaps most importantly, Yatar leaves open large questions that cannot be resolved by isolated passages of Yatar itself. As a reminder, there are, broadly speaking, two camps on the question of the constitutional scope of review. The first—represented by some judicial opinions—sees rights of appeal on questions of law as adequately respectful of Crevier, even if accompanied by clauses barring review on other questions: see the minority opinion Canada (Attorney General) v Best Buy Canada Ltd, 2021 FCA 161 (per Near JA); Canadian Council for Refugees, 2021 FCA 72 at para 102; appeal allowed in 2023 SCC 17 in part, but not dealing with this problem; Democracy Watch v Canada (Attorney General), 2022 FCA 208 at paras 34-36 per Stratas JA; Stoney Nakoda Nations v Alberta, 2023 ABKB 700. This camp sees Crevier as permitting rights of appeal on questions of law (accompanied by privative clauses) because judicial review is about “fundamental legality.” Rights of appeal on questions of law channel the review function in a way that preserves resolution of legal issues in a court. This position leaves open review for a narrow class of factual errors undergirding the legal conclusions: see Schuldt v The Queen, [1985] 2 SCR 592. I have suggested that this view is an adequate way to merge Crevier’s theoretical basis with with the modern law of judicial review and the sidelining of jurisdiction.
The other camp, represented by the majority view in Best Buy and in the work of Professor Daly, sees the best translation of Crevier as protecting review for reasonableness on fact and law; this view sees the contrary approach as insufficiently supported by the history, which has protected review for “jurisdictional facts.” A right of appeal on questions of law, then, is no substitute.
I take a different view. It is true that jurisdiction and law were, historically, two different categories. But in this case, I think history can only speak in broad strokes. This is because (1) jurisdictional error is now defunct; and (2) Vavilov’s legal constraints now encompass review for questions that were previously “jurisdictional” in nature, under a deferential standard. For this reason, concern with fundamental legality—questions of law, with a narrow basis for extremely arbitrary findings of fact that take a decision outside the scope of the statute—is a plausible translation of the now-lost force of jurisdictional error. A contrary approach centred around reasonableness might throw doubt on all manner of partial restrictions of review (for example s.18.5 of the Federal Courts Act, or clauses barring review for “reasonableness”), and arguably expand the judicial review function beyond legal limits.
But there isn’t much in Yatar for me to hang my hat on. My point is that this debate will continue: these are large, existential questions. Those questions will be dealt with in the Federal Court of Appeal’s upcoming Democracy Watch case, which will be heard next week. For now, I do not think Yatar can solve these problems, one way or another. But for what it is, Yatar is a good administrative law case from the SCC.
GSI Global Shelters Developments Ltd v Rural Municipality of Last Mountain Valley No. 250, 2024 SKCA 30 (March 13, 2024)
Category: Review of municipal bylaws/constitutional guarantee.
Context: Under bylaw adopted by the municipality, it imposed a $1200 minimum tax on residential properties within its boundaries. GSI sought judicial review of the bylaw on several grounds: (1) that it was ultra vires the Municipalities Act; (2) that it was enacted in bad faith and for improper purposes [11]. At the centre of the case is s.360 of the Municipalities Act, which provides that “No bylaw or resolution passed in good faith may be challenged on the ground that it is unreasonable.” The Chambers judge found that this provision barred review on the ground that it is unreasonable; but because of Crevier, it could not immunize review on the grounds that the bylaw is beyond the scope of the enabling authority [16]. The judge further concluded that the bylaw was not ultra vires [13].
Issue: (1) What is the scope of review under s.360 in this case?; (2) Was the bylaw passed in good-faith, and is it reasonable?
Holding: (1) Section 360 bars review for the reasonableness of bylaws except for review of good-faith; vires review (containing a residual category of review for discriminatory bylaws) remains [24]; (2) The bylaw is not ultra vires [67].
Analysis: This is a fascinating puzzle that merges two unsettled issues in the law of judicial review: the constitutional scope of review and the manner in which bylaws are reviewed, at issue in the Supreme Court’s Auer case.
On the scope of s.360, the Court interprets it as “standing for the proposition that, in absence of municipal bad faith, courts should not interfere with validly passed, intra vires bylaws” [23]. This follows a longstanding legislative instruction in Saskatchewan, which the Court (in my view, admirably) interprets to say what it means and mean what it says: bylaws are barred from review on the ground of substantive unreasonableness [20-22]. This leaves two categories of review: (1) the legislative exception within s.360 for review for “good-faith”; and (2) review for constitutionally-grounded vires, construed at common law to also include a residual category of review for “discriminatory”bylaws, extraneous to the statute’s purpose: see Montreal v Arcade Amusements Inc, [1985] 1 SCR 368.
In my view, the way the court decides the scope of s.360 pays due attention to the legislature’s instruction to oust review on some grounds. In my view, we must deal with privative clauses—or otherwise restrictions on review—as valid expressions of legislative “intent” unless shown otherwise. Here, the legislature was somewhat prescriptive, carving out good-faith review from a broader prohibition—a test the bylaw here clearly passed [38-40].
Turning to the review of the bylaw, the Chambers judge applied the standard of reasonableness to a review of the bylaw, a proposition with which the parties and the Court of Appeal agree with for this case [41]. However, the Court is careful not to step into the unsettled issue, before the Supreme Court, of how to review subordinate legislation [41-42]. Nonetheless, in applying reasonableness review, the Court—in my view, correctly—focused on the effect of Vavilov of channeling vires review into the standards of review [48]. In this case, the minimum tax fell into the broad municipal authority to enact a minimum tax to raise revenue [53-55]. This is despite potentially discriminatory effects—authorized here by the statute [62-63]. This is also even if the bylaw was enacted, in part, to promote development, which might suggest improper purpose. Nonetheless, the connection between the municipality’s budgetary shortfall and its choice of a minimum tax was enough to support the bylaw’s satisfaction of the standard of review [65]. Incidental impacts on development do not, in this case, support the proposition that the bylaw was enacted for an improper purpose.
In my view, Caldwell JA’s decision in this case is a good example of how to deal with the interacting issues of limitations on review and municipal bylaws. The effect of s.360 in this case—putting aside review for good-faith, a feature of this statutory provision—is to leave open review of the statutory validity of the subordinate instrument. That question is translated through Vavilov’s guidance on review for questions of law under the reasonableness standard, using the ordinary tools of interpretation. From that perpsective, discriminatory bylaws or totally irrational decisions on the facts also satisfy the standard, based on longstanding ideas that such legislative choices are unlikely to be authorized by the statute: see, again, Arcade Amusements.
Sometimes—as here, with a minimum tax—there will be specific and powerful legislative provisions authorizing a particular legislative tool. Incidental effects are arguably captured by the legal provisions. In other cases, broad and unfettered legislative provisions—as in Arcade Amusements itself—may not necessarily authorize particularistic and narrow discrimiantion. Much like in Yatar, we need not read into statutory provisions authorizations that are not there. My point is that this is all fundamental a question of interpretation, which the Court uses Vavilov and its tools to resolve.