Appellant 407-ETR-Concession-Company

S.C.C. Court File No. 35696
IN THE SUPREME COURT OF CANADA
(ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO)
BETWEEN:
407 ETR CONCESSION COMPANY LIMITED
Appellant
and
SUPERINTENDENT OF BANKRUPTCY
Respondent
and
ATTORNEY GENERAL OF SASKATCHEWAN,
ATTORNEY GENERAL OF QUEBEC, ATTORNEY GENERAL OF BRITISH
COLUMBIA, ATTORNEY GENERAL OF ALBERTA and ATTORNEY GENERAL OF
ONTARIO
Interveners
FACTUM OF THE APPELLANT,
407 ETR CONCESSION COMPANY LIMITED
(pursuant to Rule 42 of the Rules a/the Supreme Court a/Canada, S.O.R.l2002-156
LENCZNER SLAGHT ROYCE
SMITH GRIFFIN LLP
2600 - 130 Adelaide Street West
Toronto Ontario M5H 3P5
J. Thomas Curry ([email protected])
Tel: (416) 865-3096
Fax: (416) 865-9010
Andrew Parley ([email protected])
Tel: (416) 865-3093
Fax: (416) 865-2873
DENTONSCANADALLP
1420 - 99 Bank Street
Ottawa, Ontario KIP IH4
K. Scott McLean
Tel: (613) 783-9665
Fax: (613)783-9690
Tel: (416) 865-2893
Fax: (416) 865-2978
Corey A. Villeneuve (Law Clerk)
Tel: (613) 783-9699
Fax: (613)783-9690
Lawyers for the Appellant,
407 ETR Concession Company Limited
Ottawa Agent to counsel for the Appellant,
407 ETR Concession Company Limited
Jon Laxer ([email protected])
2
ORIGINAL TO:The Registrar
Supreme Court of Canada
301 Wellington Street
Ottawa, ON KIA on
AND TO:
DEPARTMENT OF JUSTICE - TORONTO ATTORNEY GENERAL OF CANADA
The Exchange Tower
500 - 50 O'Connor Street
130 King Street West
Room 557
Suite 3400, Box 36
Ottawa, Ontario KIA OH8
Toronto, Ontario M5X lK6
Christopher M. Rupar
Liz Tinker (39308M)
Tel: (613) 670-6290
Tel: (416) 954-5303
Fax:(613) 954-1920
Fax:(416) 973-0809
Tel: (416) 954-5303
Fax:(416) 973-0809
Lawyers for the Respondents (Appellants),
The Superintendent of Bankruptcy
Ottawa Agents for the Lawyers for the
Respondents (Appellants), The Superintendent
of Bankruptcy
ATTORNEY GENERAL OF SASKATCHEWAN
Gowling Lafleur Henderson LLP
2600 - 160 Elgin Street
Ottawa, Ontario KIP lC3
D. Lynne Watt
Tel: (613) 786-8695
Fax:(613) 788-3509
Ottawa Agents to the Intervener
Attorney General of Saskatchewan
3
ATTORNEY GENERAL OF QUEBEC
Procureur general du Quebec
1200, route de l'Eglise
215 etage
Ste-Foy, Quebec G1V 4M1
Alain Gingras
Tel: (418) 643-1477
Fax:(418) 644-7030
NOEL & ASSOCIES
111 rue Champlain
Gatineau, Quebec J8X 3R1
Pierre Landry
Tel: (819) 771-7393
Fax:(819) 771-5397
Lawyers for the Intervener
Attorney General of Quebec
Ottawa Agents for the Lawyers for the
Intervener Attorney General of Quebec
ATTORNEY GENERAL OF BRITISH
COLUMBIA
The Exchange Tower
130 King Street West
Suite 3400, Box 36
Toronto, ON M5X 1K6
BURKE-ROBERTSON
200 - 441 MacLaren Street
Ottawa, Ontario K2P 2H3
Robert E. Houston, Q.C.
Tel: (613) 236-9665
Fax:(613) 235-4430
Richard M. Butler
Tel: (250) 356-6559
Fax:(250) 356-9154
Lawyers for the Intervener
Attorney General of British Columbia
ATTORNEY GENERAL OF ALBERTA
Gowling Lafleur Henderson LLP
2600 - 160 Elgin Street
Ottawa, Ontario KIP 1C3
D. Lynne Watt
Tel: (613) 786-8695
Fax:(613) 788-3509
Ottawa Agents to the Intervener
Attorney General of Alberta
Ottawa Agents for the Lawyers for the
Intervener Attorney General of British
Columbia
4
ATTORNEY GENERAL OF ONTARIO
720 Bay Street
4th Floor
Toronto, Ontario M7A 2S9
Josh Hunter
Tel: (416) 326-3840
Fax:(416) 326-4015
Lawyers for the Intervener
Attorney General of Ontario
BURKE-ROBERTSON
200 - 441 MacLaren Street
Ottawa, Ontario K2P 2H3
Robert E. Houston, Q.C.
Tel: (613) 236-9665
Fax:(613) 235-4430
Ottawa Agents for the Lawyers for the
Intervener Attorney General of Ontario
1
TABLE OF CONTENTS
Part I - OVERVIEW AND STATEMENT OF FACTS ................................................................. 1
OVERVIEW .............................................................................................................................. 1
STATEMENT OF FACTS ........................................................................................................ 2
Highway 407 ........................................................................................................................ 2
Mr. Moore's Use of Highway 407 ....................................................................................... 4
Procedural Background ....................................................................................................... 5
The Decision on Appeal ...................................................................................................... 7
Part II - STATEMENT OF ISSUES ................................................................................................ 8
Part III - STATEMENT OF ARGUMENT .................................................................................... 8
Issue One: Did the Court Err in its Approach and Analysis of the Paramountcy Doctrine ...... 9
Issue Two: Did the Court of Appeal Err in its Conclusion that s.22(4) of the 407 Act Frustrates
the Purpose of the BIA? ........................................................................................................... 14
(a) An analysis of the merits of the Provincial statute is not called for ............................. 14
The 407 Act is valid provincial legislation ................................................................ 14
The adequacy or merits of the 407 Act are irrelevant ................................................ 16
(b) The Court erred in casting the purpose of the BIA too broadly ................................... 19
The language of the BIA requires a narrow interpretation of the Act ....................... 23
None of the other purposes of the BIA are frustrated ................................................ 24
(c) The Court erred in failing to consider the jurisdiction of Parliament .......................... 26
Part IV - SUBMISSIONS ON COSTS ......................................................................................... 28
Part V - ORDER REQUESTED ................................................................................................... 28
PART VI - TABLE OF AUTHORITIES ..................................................................................... 29
PART VII - LEGISLATION AT ISSUE ...................................................................................... 31
APPENDIX ................................................................................................................................... 40
P ART I - OVERVIEW AND STATEMENT OF I?ACTS
OVERVIEW
1.
This appeal concerns the right of Ontario to refuse to issue a vehicle permit to a
discharged bankrupt. It raises a basic question of the paramountcy doctrine.
2.
Matthew David Moore used an Ontario toll highway for many years without ever paying
the applicable charges. Following his discharge from bankruptcy, Ontario denied Mr. Moore's
ability to obtain a vehicle permit in his own name because of his previous failure to pay.
3.
At first instance, Justice Newbould of the Ontario Superior Court of Justice correctly
held that the Bankruptcy and Insolvency Act, RS.C. 1985, c B-3 ("BIA") did not compel the grant
of a vehicle permit to Mr. Moore by reason of an operational conflict with the Highway 407 Act,
1998, S.O. c. 28 ("407 Act"). He was not asked to deal with the frustration of federal purpose
argument.
Reference:
4.
Reasons of Justice Newbould, dated October 25,2011 [Motion
Reasons].
The Court of Appeal for Ontario agreed that there was no operational conflict but found
that s. 22(4) of the 407 Act frustrated the purpose of the BIA to give discharged bankrupts a fresh
start.
Reference:
5.
Reasons of Court of Appeal, dated December 19,2013 [Appeal
Decision].
The Court of Appeal erred in its conclusion. Its decision is at odds with this Court's
decisions on paramountcy in three ways:
2
(a)
it evaluated the relative merit of federal and provincial schemes, and held the
federal scheme paramount. There is no support in this Court's jurisprudence for
undertaking such an analysis;
Reference:
P. W. Hogg, Constitutional Law of Canada, loose-leaf
(consulted on September 18,2014) 5th ed. (Toronto: Carswell,
2007), ch. 16 at 3, 17.
it erred in identifying too broad and vague a purpose of the BfA. By adopting that
(b)
approach, the Court of Appeal created conflicts between the BfA and valid
provincial legislation where none existed before; and
Reference:
Canadian Western Bank v. Alberta, [2007] S.C.R. 3 at paras.
74, 75 [Canadian Western Bank].
it held that the BfA required that vehicle permits be granted to discharged bankrupts
(c)
even though it would be ultra vires for Parliament to enact a law to that effect.
6.
The analysis of the Court of Appeal ignores contemporary constitutional law and alters
the balance of power between Parliament and the provinces.
STATEMENT OF FACTS
Highway 407
7.
Highway 407 is the world's first all-electronic open access toll highway. The purpose of
Highway 407 is to relieve congestion on public highways. Highway 407 is operated by 407 ETR
Concession Company Limited ("407 ETR") under the terms of an agreement with Ontario. 407
ETR is unable to limit the use of the highway in any way. People who use the toll highway have
open access to it 24 hours per day, 365 days a year, without paying at the point of entry or exit.
Reference:
Motion Reasons at para. 4;
3
Appeal Decision at para 21.
8.
The 407 Act empowers 407 ETR to establish and collect the payment of tolls,
administration fees, and interest for the use of Highway 407. Under the 407 Act, the tolls and other
charges are payable by the person in whose name the vehicle permit is registered. l
Reference:
Motion Reasons at para. 5;
Blue Star Trailer Rentals Inc. v. 407 ETR Concession Company
Limited (2008), 91 O.R. (3d) 321, at para. 11 (C.A.).
9.
If the toll is not paid, then 407 ETR may send that person a notice of failure to pay (a
"Section 16 Notice"). If the amount owing remains unpaid for 90 days following receipt of a
Section 16 Notice, 407 ETR may give notice of that fact to the Ontario Registrar of Motor Vehicles
and to the person (a "Section 22 Notice").
Reference:
10.
407 Act, ss. 13(1), 16,22(1)(3).
The legislative regime for the collection of the payment of tolls is called Licence Plate
Denial. Once the Registrar of Motor Vehicles receives a Section 22 Notice, the Registrar must
refuse to validate the vehicle permit issued to the person who received the Section 16 Notice and
refuse to issue a new vehicle permit to that person. Licence Plate Denial provides 407 ETR with a
collection tool, ensures fairness, prevents abuse, and has a public interest dimension ..
Reference:
407 Act, ss. 22(4)(5);
Motion Reasons at para. 5;
407 ETR Concession Co. v. Ontario (Registrar of Motor
Vehicles) (2005), 82 O.R. (3d) at para. 34 (Div. Ct.).
I
If there is a toll device in the vehicle, the invoice is sent to the person who registered the toll device.
4
11.
Since access to Highway 407 cannot be restricted, even where an owner of a vehicle is
in default of statutory payment obligations to 407 ETR, Licence Plate Denial also provides 407
ETR with a limited basis to restrict the granting of additional credit to users of its services. No
person is ever required to use Highway 407. Other public highways and roads exist for which
there are no tolls.
Reference:
Affidavit of Peter Whyte, sworn October 4, 2011 at para. 7
[Whyte Affidavit];
Appeal Decision at para. 25.
12.
The operator of Highway 407 is in a unique position. Other public and private enterprises
faced with customers in default of their payment obligations can elect to refuse service or cancel
credit to those who refuse to pay. In contrast, 407 ETR cannot bar anyone from using Highway
407.
Mr. Moore's Use of Highway 407
13.
As of October 2007, Mr. Moore owed a debt to 407 ETR in the amount of$34,977.06. This
debt arose out of almost 2,000 trips taken on Highway 407 between August 1998 and March 2007
by two vehicles registered to Mr. Moore.
Reference:
14.
Motion Reasons at para. 6.
One of Mr. Moore's iicence piates was attached to a 2002 2-door Mercedes Benz (the
"Mercedes Benz"), the other to a 1993 Pontiac sedan (the "Pontiac"). The vast majority ofthe debt
accumulated by Mr. Moore arose out of trips taken in the Mercedes Benz. The Mercedes Benz
was driven on Highway 407 every month between January 2002 and March 2007.
Reference:
Whyte Affidavit at paras. 14-18.
5
15.
407 ETR invoiced Mr. Moore in accordance with the process provided under the terms of
the 407 Act. Mr. Moore did not dispute any of the charges for which he was invoiced as he is
permitted to do under the provisions of the 407 Act established for that purpose. Mr. Moore never
made any payments to 407 ETR in relation to these charges.
Reference:
16.
Whyte Affidavit at paras. 20-21.
In March 2005,407 ETR sent a Section 22 Notice to the Registrar of Motor Vehicles with
respect to trips taken in the Mercedes Benz. Another Section 22 Notice was sent to the Registrar of
Motor Vehicles in December 2006 with respect to trips taken in the Pontiac. Upon receipt of the
Section 22 Notices, the Registrar of Motor Vehicles refused to validate the vehicle permit issued to
Mr. Moore and refused to issue a new vehicle permit to Mr. Moore.
Reference:
17.
Motion Reasons at para. 7.
When the vehicle permit attached to the Mercedes Benz expired on August 17, 2005, it
could not be renewed. However, the Mercedes Benz continued to be used on Highway 407 for
another 18 months, in breach of the provisions of Section 51 of the Highway Traffic Act, R.S.O.
1990, Ch. B.8.
Reference:
Motion Reasons at para. 8;
Highway Traffic Act, R.S.O. 1990, Ch. H.8, s. 51.
Procedu.ral Backgrou.nd
18.
Mr. Moore made an assignment in bankruptcy on November 10,2007.
Reference:
Appeal Decision at para. 7.
6
19.
Following a conditional discharge from bankruptcy, Mr. Moore was granted an absolute
discharge on June 21, 2011. He brought a motion before the Registrar of Bankruptcy and then a
motion to the Superior Court of Justice seeking:
(a)
a declaration that his debt to 407 ETR is released upon his satisfaction of the terms
of his conditional discharge order; and,
(b)
an order compelling the Ontario Ministry of Transportation to issue a vehicle
permit to him upon payment of the applicable licencing fees by virtue of an
operational conflict between s. 22 (4) of the 407 Act and the BfA.
20.
Mr. Moore's motion was heard on the merits before the Honourable Mr. Justice Newbould.
Mr. Moore gave notice of a constitutional question to the Attorneys General of Canada and
Ontario. The Superintendent of Bankruptcy (the "Superintendent") did not appear on the motion.
By a decision dated October 25, 2011, Justice Newbould dismissed the motion and held that there
was no conflict in the operation of s. 22(4) of the 407 Act and section 178(2) of the BfA.
Reference:
21.
Motion Reasons at para. 33.
Following the release of this decision, Mr. Moore and 407 ETR settled the dispute between
them. On November 4,2011, the Superintendent served a Notice of Appeal. 407 ETR brought a
to appeal the Order without leave. In response, the Superintendent brought a motion seeking leave
to appeal. On September 5, 2012, the Court of Appeal granted both motions.
Reference:
Appeal Decision at paras. 15 and 16.
7
The Decision on Appeal
22.
By Reasons dated December 19,2013, the Court of Appeal found that the 407 Act and the
BfA were both validly enacted and that there was no operational conflict between the two
provisions. However, the Court concluded that s. 22(4) of the 407 Act frustrated the purpose of the
BfA by denying a vehicle permit to a driver following his discharge from bankruptcy. The Court
reasoned that one of the purposes of the BfA was to give discharged bankrupts a fresh start, and
that the provision of the 407 Act that barred Mr. Moore from obtaining a vehicle permit was
inoperative by reason of the doctrine of paramountcy.
Reference:
23.
Appeal Decision at paras. 84 and 93.
The Court limited its analysis of frustration of federal purpose to the purpose of financial
rehabilitation. The Court characterized this purpose very broadly as giving a discharged bankrupt
the "ability to start life afresh unencumbered by his or her past indebtedness".
Reference:
24.
Appeal Decision at para. 99.
In evaluating whether this purpose had been frustrated, the Court improperly focused on
the purpose and merits of s. 22(4) of the 407 Act. The Court of Appeal failed to conduct the
paramountcy analysis required by decisions of this Court.
Reference:
Appeal Decision at paras. 104-108.
8
PART H - STATEMENT OF ISSUES
25.
This appeal raises the following issues:
(a)
Did the Court of Appeal err in its approach and analysis of the paramountcy
doctrine; and,
(b)
Did the Court of Appeal err in concluding that s. 22(4) of the 407 Act frustrates the
purpose of the BfA:
(i)
by engaging in a balancing of competing purposes;
(ii)
by casting the purpose of the BfA too broadly; and,
(iii)
in failing to properly consider the scope of Parliament's jurisdiction.
PART HI-STATEMENT OF ARGUMENT
26.
The Appellant submits that the Court of Appeal erred in its analysis in three fundamental
ways:
(a)
First, it ignored established law and made an analysis of the merits and adequacy of
provincial legislation in determining the question of conflict with federal law. The
purpose of the provincial law is irrelevant to whether there is a conflict with the
federal law.
(b)
Second, it erred by defining the scope and purpose of the BfA too broadly. Only in
the clearest of cases should the Court declare valid provincial laws inoperative as a
result of frustration of federal purpose. The Court's approach should have started
with a narrow purpose.
9
(c)
Third, the Court of Appeal's decision results in a constitutional anomaly.
Parliament could not achieve directly what it has now achieved indirectly. It has
improperly obtained the power to compel the provinces to issue all manner of
provincial licences and permits to discharged bankrupts.
Issue One: Did the Court Err in its Approach and Analysis of the Paramountcy Doctrine
27.
There are two stages to an analysis ofthe paramountcy doctrine in Canadian constitutional
law.
28.
The Court must first determine ifthe two laws in question are validly enacted. It does so by
identifying the "pith and substance" of the two provisions in question and determining the
character of the enactments. Once the "pith and substance" has been ascertained, the Court must
identify the heads of provincial and federal authority in the Constitution Act under which the
provisions fall. The Court must identify whether either or both provisions are validly enacted.
Reference:
The Constitution Act, 1867, 30 & 31 Viet, c 3, ss. 91, 92
[Constitution Act];
Chatterjee v. Ontario (Attorney General), [2009] 1 S.C.R. 624
at paras. 16,24 [Chatterjee];
Canadian Western Bank at para. 76.
29.
Here, the Court of Appeal correctly found that both statutes are validly enacted.
Reference:
30.
Appeal Decision at para. 84.
Second, ifboth laws at issue are found to be valid, the Court must identify whether there is
a conflict between the provincial provision and the federal provision.
10
31.
There are two types of conflict for the purpose of a paramountcy analysis. First, there may
be a "conflict in operation" between the two provisions. This is sometimes referred to as the
"impossibility of dual compliance" test. The test for such a conflict is a strict one: it must be
impossible for a citizen to lawfully comply with both rules:
If the dominant purpose of the provincial enactment is in relation to
provincial objects, the law will be valid, and if the enactments of both
levels of government can generally function without operational conflict
they will be permitted to do so. In factual situations where operational
conflict does occur, the conflict will be resolved by the restrained view of
federal paramountcy established by Multiple Access Ltd. v. McCutcheon,
[1982] 2 S.C.R. 161, where it was said at p. 191:
In principle, there would seem to be no good reasons to speak of
paramountcy and preclusion except where there is actual conflict
in operation as where one enactment says "yes" and the other says
"no"; "the same citizens are being told to do inconsistent things";
compliance with one is defiance of the other.
Reference:
Chatterjee at para. 36;
Quebec (Attorney General) v. Canadian Owners and Pilots
Association, [2010] 2 S.C.R. 536 at para. 64 [COPA];
Multiple Access Ltd. v. McCutcheon, [1982] 2 S.C.R. 161 at
191.
32.
The Court of Appeal correctly stated this aspect of the test and held that there is no conflict
in operation between the federal and provincial provisions.
Reference:
33.
Appeal Decision at paras. 86,93.
Second, there may be a conflict where the operation of the provincial law frustrates the
purpose of the federal law. The operation of the provincial provision must clearly be shown to be
directly at odds with the valid purpose of the federal provision and must frustrate its purpose.
11
34.
The test for frustration of federal purpose is strictI y applied.
Consonant with the
"dominant tide" of Canadian federalism, which fosters overlapping j urisdiction wherever possible,
frustration of federal purpose arises only in the clearest of cases. This was explained by Chief
Justice Dickson in OPSEU v. Ontario (Attorney General), in a passage adopted recently by this
Court in the Securities Act Reference:
The history of Canadian constitutional law has been to allow for a fair
amount of interplay and indeed overlap between federal and provincial
powers. It is true that doctrines like interjurisdictional and Crown
immunity and concepts like "watertight compartments" qualify the extent
of that interplay. But it must be recognized that these doctrines and
concepts have not been the dominant tide of constitutional doctrines;
rather they have been an undertow against the strong pull of pith and
substance, the aspect doctrine and, in recent years, a very restrained
approach to concurrency and paramountcy issues.
Reference:
OPSEUv. Ontario (Attorney General), [1987] 2 S.C.R. 2 at 18;
Reference re Securities Act, [2011] 3 S.C.R. 837 at para. 57.
35.
The constitutional stakes are high when the federal parliament asserts its paramountcy. In
Canadian Western Bank, the Court held that the restrained application of paramountcy, and
particularly of the doctrine "frustration offederal purpose", was necessary to preserve the balance
struck in the Constitution Act. Taking an overly-broad interpretation of the federal purpose would
overshadow many of the provinces' core powers:
The fact that Parliament has legislated in respect of a matter does not lead
to the presumption that in so doing it intended to rule out any possible
provincial action in respect of that subject. As this Court recently stated,
"to impute to Parliament such an intention to 'occup[y] the field' in the
absence of very clear statutory language to that effect would be to stray
from the path of judicial restraint in questions of paramountcy that this
Court has taken since at least O'Grady" (Rothmans, at para. 21).
An incompatible federal legislative intent must be established by the party
relying on it [... ] To sum up, the onus is on the party relying on the
doctrine of federal paramountcy to demonstrate that the federal and
provincial laws are in fact incompatible by establishing either that it is
12
impossible to comply with both laws or that to apply the provincial law
would frustrate the purpose of the federal law.
Reference:
36.
Canadian Western Bank at paras. 74-75.
Indeed, the concern to maintain provincial authority in the face of the doctrine of federal
paramountcy has led to a presumption that an Act of Parliament is not intended to conflict with
provincial legislation. A conflict should only be identified where that is the only reasonable
interpretation available. If a narrower interpretation of the federal provision avoids a conflict, it is
to be applied.
37.
This was first stated by the Court in Attorney General o/Canada v. Law Society o/British
Columbia, and was endorsed recently by the majority in Sun Indalex Finance LLC:
[W]hen a federal statute can be properly interpreted so as not to interfere
with a provincial statute, such an interpretation is to be applied in
preference to another applicable construction which would bring about a
conflict between the two statutes.
Reference:
Attorney General of Canada v. Law Society of British
Columbia, [1982] 2 S.C.R. 307 at 356;
Sun Indalex Finance LLC v. United Steelworkers, [2013]
S.C.R. 271 at para. 57;
COPA at paras. 66, 68.
38.
To guard against the diminution of provincial authority, this Court has set a high bar for
proving that there is a conflict between a provincial and federal law. This burden is higher where
there is an alleged frustration of federal purpose, rather than an actual conflict in the operation of
the two laws. As recently held in Quebec (Attorney General) v. Canadian Owners and Pilots
Association ("COPA"), the party invoking federal paramountcy bears the onus of proving "with
clear proof of purpose" that Parliament's purpose is frustrated by the provincial law:
13
[I]nvocation of federal paramountcy on the basis of frustration of purpose,
as opposed to operational conflict, requires clear proof of purpose; mere
permissive federal legislation does not suffice.
Reference:
39.
COPA at paras. 66, 68.
One of the reasons that the test of "frustration of federal purpose" is so stringent is that
Parliament is free to amend its legislation in order to create a direct conflict, assuming that it would
be intra vires to do so. The doctrine may only be invoked in those cases where Parliament has
consciously chosen not to regulate in a particular area within its jurisdiction.
Reference:
40.
Canadian Western Bank at para. 46.
In this case, the Court of Appeal held that s. 22(4) of the 407 Act frustrated the purpose of
the BfA in denying Mr. Moore a fresh start following his discharge from bankruptcy by failing to
reinstate a vehicle permit issued in Mr. Moore's name:
At its heart, permitting a creditor to insist on payment of pre-bankruptcy
indebtedness after bankruptcy discharge frustrates a bankrupt's ability to
start life afresh unencumbered by his or her past indebtedness.
Reference:
41.
Appeal Decision at paras. 99, 115.
Although the Court of Appeal correctly stated many elements of the paramountcy doctrine,
it erred in its conclusion that s. 22(4) of the 407 Act frustrated the purpose of the BfA for the
reasons set out below.
Reference:
Appeal Decision at paras. 58-66.
14
Issue Two: Did the Court of Appeal Err in its Conclusion that s.22(4) of the 407 Act
Frustrates the Purpose of the BIA?
(a) An analysis of the merits of the Provincial statute is not called for
42.
The Court of Appeal correctly held that both enactments at issue are validly enacted. It
erred when it went on to evaluate the merits of the provincial law. The merits ofthe provincial law
are irrelevant to the paramountcy analysis.
The 407 Act is valid provincial legislation
43.
Section 22 of 407 Act provides:
22. (1) If a toll, and the related fees and interest, are not paid within 90 days of
the day a person receives a notice of failure to pay under section 16, the owner
may notify the Registrar of Motor Vehicles of the failure to pay.
(2) Any notice to the Registrar of Motor Vehicles under this section may be
given in writing, by direct electronic transmission or by any other prescribed
method.
(3) The owner shall promptly inform the person who received notice offailure to
pay under section 16 that notice has been given to the Registrar of Motor
Vehicles under subsection (1).
(4) If the Registrar of Motor Vehicles receives notice under subsection (1), he or
she shall, at the next opportunity, refuse to validate the vehicle permit issued to
the person who received the notice offailure to pay under section 16 and refuse
to issue a vehicle permit to that person.
(5) The Registrar of Motor Vehicles may act under subsection (4) even though
the person who received the notice of failure to pay under section 16 has
disputed his or her obligation to pay under section 17 or has appealed a decision
of the owner under section 19.
(6) If notice has been given to the Registrar of Motor Vehicles under subsection
(1) and the toll and related fees and interest are subsequently paid, the owner
shall immediately notify the Registrar of the payment.
(7) If the Registrar of Motor Vehicles is notified by the owner that the toll, fees
and interest have been paid or is notified by the dispute arbitrator that the person
is not responsible for paying the toll, fees and interest, the Registrar shall,
(a) validate any vehicle permit that he or she refused to validate
under subsection (4);
15
(b) issue a vehicle permit to a person if it was refused under
subsection (4).
Reference:
44.
407 Act, s. 22 [emphasis addedj
Ontario has authority under at least three heads of power to enact section 22(4) of the 407
Act:
(a)
Section 92(13), which assigns authority to Ontario to regulate "property and civil
rights" in the province;
(b)
Section 92(9), which assigns authority to Ontario to regulate licencing for the
purpose of raising revenue in the Province; and,
(c)
Section 92(10), which assigns authority to Ontario for the regulation of roads as
part of local works and undertakings.
Reference:
Constitution Act, s. 92;
407 Act, s. 22.
45.
The provincial provision at issue falls squarely within provincial authority. Licencing for
operating a vehicle on Ontario roads has historically fallen under the provincial sphere of power as
has the regulation of vehicle permits. The provinces are responsible for the construction and
maintenance of roads, including making decisions about how to alleviate congestion. Owning or
operating a motor vehicle is a privilege which the provincial governments alone may grant to
civilians.
46.
As held by Duff C.J. in Provincial Secretary of Prince Edward Island v. Egan, and
affirmed by the majority in Ross v. Registrar of Motor Vehicles:
16
Primarily, responsibility for the regulation of highway traffic, including
authority to prescribe the conditions and the manner of the use of motor
vehicles on highways and the operation of a system of licences for the
purpose of securing the observance of regulations respecting these matters
in the interest of the public generally, is committed to the local
legislatures.
Reference:
Provincial Secretary of Prince Edward Island v. Egan, [1941]
S.C.R. 396 at 402-403;
Rossv. Registrar of Motor Vehicles, [1975] 1 S.C.R. 5 at 10.
The adequacy or merits of the 407 Act are irrelevant
47.
Having established that the 407 Act is validly enacted, the Court erred in going on to
consider whether the purpose of s. 22 of the 407 Act was sufficiently important to be given effect.
48.
The Court of Appeal concluded that the purpose of the 407 Act and the public-private
partnership between the 407 ETR and the province was:
inadequate ... to remove the evident inconsistency with such a
fundamental purpose of the BIA as financial rehabilitation of the
discharged bankrupt. [emphasis addedJ
Reference:
49.
Appeal Decision at para. 111.
The Court of Appeal distinguished decisions in Re Hover and Re Caporale on the
ground that the impugned provisions of the 407 Act are not sufficiently directed at the public
interest:
The purpose of the legislation in those cases was directed at the province's
regulatory responsibility and the public interest in establishing and
enforcing standards of professional conduct for dentists, and presumably
the promotion of safe and responsible driving.
Reference:
Appeal Decision at para. 107.
17
50.
The purpose of the provincial law is irrelevant to whether there is a conflict with the
federal law. The question at the conflict stage is simply whether the operation of the provincial law
frustrates the purpose of the federal law. The legislature's reasons for enacting a law within its
jurisdiction, or the social benefits of that legislation, are not relevant considerations.
51.
The only proper place for evaluating the provincial purpose is when determining if the
provincial law is intra vires, which the Court of Appeal concluded it was. This point was made by
Professor Hogg in Constitutional Law o/Canada:
This may appear to be labouring the obvious, but there are a startling
number of judicial opinions which confuse the issue of consistency with
the antecedent, and entirely different, Issue of validity.
[ ... ]
This kind of reasoning confuses validity with consistency. The existence
of different purposes or aspects is relevant only to the question whether
each law is valid in the first place. The double aspect doctrine opens two
gates to the same field, but it does not help to resolve the subsequent
question of whether the two laws are inconsistent.
Reference:
52.
P. W. Hogg, Constitutional Law of Canada, loose-leaf
(consulted on September 18,2014) 5th ed. (Toronto: Carswell,
2007), ch 16 at 3, 17.
When the federal government invokes the doctrine of frustration of federal purpose, it is
asking for the remedy of declaring a provincial law inoperative even though it does not directly
conflict with any law passed by Parliament.
For this reason, it bears a heavy burden of
demonstrating that the provincial law frustrates Parliament's purpose.
Reference:
53.
COPA at para. 66.
No equivalent burden is placed on the province to defend or justify its purpose for
exercising its jurisdiction. The Ontario Legislature has the unchallengeable power to set the terms
18
for issuing vehicle registration permits. Absent a Charter challenge, or an argument that the law is
ultra vires (neither of which are present here), a province is never required to justify its reasons for
enacting a law.
54.
However, the Court of Appeal went beyond merely discussing the provincial purpose: it
evaluated the merit of that purpose and concluded that it was "inadequate" in justifying its
conclusion that s. 22(4) of the 407 Act be declared inoperative.
Reference:
55.
Appeal Decision at paras. 107, Ill.
This type of analysis is without precedent. There is no basis for a Court to undertake a
free-standing evaluation of the relative merit of the province's legislation as opposed to the merit
of the federal legislation. As held in Vriend v. Alberta, Courts are not to second-guess legislatures:
In carrying out their duties, courts are not to second-guess legislatures and
the executives; they are not to make value judgments on what they regard
as the proper policy choice; this is for the other branches. Rather, the
courts are to uphold the Constitution and have been expressly invited to
perform that role by the Constitution itself. But respect by the courts for
the legislature and executive role is as important as ensuring that the other
branches respect each other's' role and the role ofthe courts.
Reference:
56.
Vriendv. Alberta, [1998] 1 S.C.R. 493 at para. 136.
The decision of the Court of Appeal does precisely the opposite, and undertakes a
free-standing evaluation of the merits of the 407 Act and the public-private partnership between
407 ETR and Ontario.
19
(b) The Court erred in casting the purpose of the RIA too broadly
57.
The Court of Appeal held that the BfA was a comprehensive scheme designed to give
discharged bankrupts a "fresh start" and an "ability to start life afresh unencumbered by his or her
past indebtedness". This definition of the scope and purpose of the BfA is cast too broadly.
Reference:
58.
Appeal Decision at paras. 99-102.
The implication of the decision is to make any legislation affecting bankrupts following
their discharge from bankruptcy the exclusive domain of the federal government, akin to a new
area of interjurisdictional immunity. It has effectively created a no-go zone for the Provinces
around the licensing of discharged bankrupts. As recently held by this Court in Canada (Attorney
General) v. PHS Community Services Society, creating such a legal vacuum is "inimical to the very
concept of the division of powers."
Reference:
59.
Canada (Attorney General) v. PHS Community Services
Society, [2011] 3 S.C.R. 134 at paras. 64, 69.
As held in Canadian Western Bank, one must assume that Parliament did not intend to
occupy the field and thereby invalidate whole areas of provincial legislation. If the federal scheme
may be interpreted more narrowly so as to avoid a conflict, the narrower interpretation is to be
applied.
Reference:
Canadian Western Bank at paras. 74-75;
COPA at paras. 66, 68.
60.
This is contrary to the approach adopted by the Court of Appeal, in which the Court
adopted the broadest possible interpretation of the purpose and intended scope of the BfA.
20
61.
The BfA is intended to be a comprehensive scheme for some purposes. The Court of
Appeal correctly held that all provable claims are caught by the bankruptcy process and that the
bankrupt is released of all of these claims following his discharge. The Court also correctly held
that the BfA provides a comprehensive scheme for distributing the property of the bankrupt
amongst those creditors with provable claims.
Reference:
62.
Appeal Decision at paras. 32-35.
The Court of Appeal erred in expanding these previously established propositions to
find that the BfA is also a comprehensive scheme for determining the extent to which a bankrupt's
past indebtedness will be considered in evaluating whether to grant that person additional
privileges or credit. This additional, and heretofore unrecognized, conclusion does not flow from
these earlier propositions regarding the comprehensiveness of the BfA.
63.
Although it is correct that the BfA needs to be a comprehensive scheme in some respects
in order to ensure the orderly distribution of the assets of a bankrupt, this same conclusion does not
hold for the purpose of financial rehabilitation. This is especially so where financial rehabilitation
is interpreted to require that the bankrupt must regain all of the privileges that they once enjoyed
prior to becoming indebted.
64.
The BfA does not, and cannot be interpreted to, guarantee that a discharged bankrupt is
completely "unencumbered by his or her past indebtedness" as held by the Court of Appeal. The
purpose of financial rehabilitation is achieved by prohibiting enforcement of debts that have been
discharged. It does not also require that all provincial licences, permits and privileges be reinstated
to the person who has been discharged from bankruptcy.
21
65.
The decision of the Court of Appeal on this point is directly contrary to the view
expressed by Houlden and Morawetz in Bankruptcy and Insolvency Law of Canada in a passage
quoted by Justice Newbould in his Reasons at first instance:
If a bankrupt is given a discharge, it does not follow that he or she is
entitled to reinstatement of his or her privilege of operating a motor
vehicle. A province may decide as part of its licencing power that an
operator of a motor vehicle will not be permitted to drive. There is no
conflict between the provisions of the Bankruptcy and Insolvency Act and
provincial legislation that prohibits a person who has an unsatisfied
judgment arising out of a motor accident from receiving a licence to
operate a motor vehicle.
Reference:
L. W. Houlden & G. B. Morawetz, Bankruptcy and Insolvency
Law of Canada, loose-leaf(consulted on September 18,2014)
4th ed., (Toronto: Carswell, 2013), ch. 6 at 289;
Motion Reasons at para. 28.
66.
The purpose of the BIA is to stay enforcement proceedings against the discharged
bankrupt, not to extinguish the debt. Courts have repeatedly found that s. 178(2) of the BIA was
not intended to extinguish the debts that underlie these claims, nor does it do this in fact. The debt
survives the bankruptcy.
407 ETR is barred from enforcing the debt against a discharged
bankrupt, but is not obligated to act as if there is no debt.
67.
This interpretation of s. 178(2) of the BIA was adopted by the Ontario Court of Appeal
in Shea v. Frazer:
It appears that s. 178(2) of the Bankruptcy and Insolvency Act, R.S.C.
1985, c. B-3 (the BIA) does not have the effect of releasing the debtor's
legal obligation to pay but rather prevents a creditor from pursuing
remedies against the debtor's property. In Re Handelman, [1997] OJ. No.
3599 (S.C.J.) Farley J. upheld Master Ferron's grant of leave to a creditor
to proceed with an action against a discharged bankrupt. In doing so,
Farley J. considered the decision of Catzman J. (as he then was) in Re
Kryspin (1983), 40 O.R. (2d) 424 (H.C.J.) respecting the predecessor to s.
178(2) to the effect that the section does not extinguish the debt but only
releases the debtor from claims provable in bankruptcy. Justice Farley
22
also noted that s. 69.3(1) of the BIA only stays any remedy against the
bankrupt's property and the commencement or continuation of any action
for the recovery of a claim provable in bankruptcy
Reference:
Shea v. Fraser (2007), 85 O.R. (3d) 28 (C.A.) at note 1;
BIA, s. 178(2).
68.
When approached by an individual seeking credit following discharge from bankruptcy,
creditors are entitled to consider the fact of the bankruptcy and debts that remain unpaid.
Similarly, the Province is entitled to create a legislative scheme that considers the prior debts ofthe
individual, including in the context of a grant of privileges or the extension of credit. This power
extends to debt that remains outstanding despite the fact that the debt is rendered unenforceable by
virtue of a discharge from bankruptcy.
Reference:
69.
e.g. Consumer Reporting Act, R.S.O. 1990, Ch C.33, s. 9(3)(e).
The notion that a debt survives bankruptcy was recently explained by this Court in
Newfoundland and Labrador v. AbitibiBowater Inc., in which the majority held that:
Subjecting an order to the claims process does not extinguish the debtor's
environmental obligations any more than subjecting any creditor's claim
to that process extinguishes the debtor's obligation to pay its debts. It
merely ensures that the creditor's claim will be paid in accordance with
insolvency legislation.
Reference:
70.
Newfoundland and Labrador v. AbitibiBowater Inc., [2012] 3
S.C.R. 443 at para. 40 (Abitibi].
In Re Caporale, Justice Houlden held that licence suspension remedy is a proper one
within the bankruptcy context.
In upholding the Minister of Transport's right to suspend the
bankrupt's licence, Justice Houlden stated that:
23
The Minister of Transport as a result of the bankruptcy cannot take
proceedings to enforce his judgment but he has the very effective remedy
that he can refuse the debtor the privilege of driving in this Province until
he repays in full the amount which has been paid out of the Fund.
Reference:
71.
Re Caporale, [1970] 1 O.R. 37 at para. 5 (S.C.).
The vague object of providing the bankrupt with an "ability to start life afresh
unencumbered by his or her past indebtedness" cannot be relied upon to create entirely new
powers under the BfA. As Justice Newbould stated in his Reasons, "the fact that one of the
purposes of the BIA is to permit a bankrupt to financially rehabilitate himself or herself does not in
itself provide any jurisdiction to [order the Registrar of Motor Vehicles to grant a permit to] Mr.
Moore".
Reference:
72.
Motion Reasons at para. 35.
Finally, even if it were possible to interpret the BfA as regulating the granting of provincial
privileges, this is certainly not the only reasonable interpretation of the BfA. It is at least equally
reasonable to interpret the BfA as not coming into any conflict with the 407 Act. In such a case, the
valid provincial law is to be given full force and effect.
Reference:
Canadian Western Bank at paras. 74-75.
The language ofthe BfA requires a narrow interpretation o(the Act
73.
Section 72 of the BfA further supports the conclusion that a narrow interpretation of the
Act is to be favoured. This section expressly cautions that conflicts with provincial authority to
regulate property and civil rights are to be avoided:
72. (1) The provisions of this Act shall not be deemed to abrogate or
supersede the substantive provisions of any other law or statute relating to
property and civil rights that are not in conflict with this Act, and the
24
trustee is entitled to avail himself of all rights and remedies provided by
that law or statute as supplementary to and in addition to the rights and
remedies provided by this Act.
(2) No bankruptcy order, assignment or other document made or executed
under the authority of this Act shall, except as otherwise provided in this
Act, be within the operation of any legislative enactment in force at any
time in any province relating to deeds, mortgages, hypothecs, judgments,
bills of sale, chattel mortgages, property or registration of documents
affecting title to or liens or charges on real or personal property or
immovables or movables.
Reference:
74.
BIA, s. 72.
In GMAC Commercial Credit Corporation - Canada v. TCT Logistics Inc., this Court
held that s. 72 was evidence that Parliament did not intend for the BIA to be interpreted broadly:
The effect of s. n( 1) is that the Bankruptcy and Insolvency Act is not
intended to extinguish legally protected rights unless those rights are in
conflict with the Bankruptcy and Insolvency Act.
Reference:
75.
GMAC Commercial Credit Corporation - Canada v. TCT
Logistics Inc., [2006] 2 S.C.R. 123 at paras. 46-47.
Contrary to the approach taken by the Court of Appeal, the explicit language of the BIA
requires that the Act be read narrowly so as to not conflict with provincial law.
None ofthe other purposes ofthe BIA are frustrated
76.
Beyond financial rehabilitation, the BIA has two other primary purposes: the ordering of
priorities and the division of assets. These other two purposes were recognized by the Court of
Appeal in the Appeal Decision. The Court did not consider whether these other purposes were
frustrated as it found this to be unnecessary given its conclusion regarding the frustration of the
purpose of financial rehabilitation
Reference:
Appeal Decision at paras. 30-31, 117.
25
77.
Neither of these other two purposes is frustrated by s. 22(4) of the 407 Act.
78.
There is no risk of a reorganization of creditor priorities here. Justice Newbould correctly
held that s. 22(4) of the 407 Act does not have the effect of reorganizing the priority of creditors
under bankruptcy law. As the Alberta Court of Appeal explained in Re Hover:
Schemes that withhold licences do not have the effect of reorganizing the
priority of creditors when payment of fines is not mandatory. Provincial
legislation which governs the grant or suspension of a licence does not
deal with the bankrupt's property and therefore, does not conflict with, nor
interfere with, the distribution of the bankrupt's property.
Reference:
Re Hover (2005), 251 D.L.R. (4th) 263 (ABCA) at para. 59
[Hover];
Motion Reasons at para. 32.
79.
The decision of this Court in Newfoundland and Labrador v. AbitibiBowater Inc. does not
assist the Superintendent. In that case, the Province sought to exclude environmental orders from
the CCAA process entirely. Here, there is no dispute that the debts are rendered unenforceable by
the BIA. The question is rather whether the refusal to issue a permit to a discharged bankrupt
reorganizes the priorities in the bankruptcy process, which it does not.
Reference:
80.
Abitibi at paras. 4,40.
With respect to the purpose of distributing the assets of the bankrupt, Justice Newbould
correctly held that a vehicle permit is not an asset that belongs to the bankrupt and is not impacted
by a bankruptcy proceeding.
Reference:
Motion Reasons at para. 21.
26
81.
In Cooke v. Pilot Insurance Co., Justice Philp held that the suspension provision of
provincial highway legislation was enforceable in Ontario despite the discharge from bankruptcy
of the licence holder. In a passage quoted by Justice Newbould in his Reasons, Justice Philp
explained:
In my view, this section allows s. 198 of the Highway Traffic Act to be
enforced in spite of the bankruptcy. It is not in conflict with the BfA.
While the BfA deals with the property of the bankrupt, s. 198 relates to the
license of the bankrupt. A license to drive or a privilege to drive is not
property of the bankrupt and therefore is not affected by the bankruptcy. In
other words, the action continued by Pilot against the bankrupt was stayed
by s. 69.3(1) only as it related to the bankrupt's property. The BfA is
designed to assure the orderly distribution ofthe bankrupt's property on an
equal basis. It does not affect the bankrupt's license to drive. The judgment
obtained by Pilot while not valid against the bankrupt as it relates to his
property is nevertheless valid for the purpose of suspending his license to
drive by reason of the outstanding judgment.
Reference:
Cooke v. Pilot Insurance Co. (1996), 68 A.C.W.S (3d) 797
(Ont. Ct. 1. (Gen. Div.» at para. 16.
(c) The Court erred in failing to consider the jurisdiction of Parliament
82.
The Court of Appeal failed to grasp the necessary implications ofthe doctrine of frustration
of federal purpose. It may only be invoked to achieve a result that Parliament could directly
achieve by enacting legislation. The Court must find that Parliament was intentionally silent on
the issue, rather than being silent because it lacked jurisdiction.
Reference:
83.
Canadian Western Bank at para. 46.
As a result, the Court of Appeal has created a constitutional anomaly. Parliament could
not achieve directly what it has now achieved indirectly. It has the benefit of a law that requires the
provinces to issue all manner of provincial licences and permits to discharged bankrupts. No
federal head of power provides Parliament the power to require provincial bodies to grant permits
27
to an individual, or require third parties to extend credit to an individual, because they are
discharged from bankruptcy.
84.
As Justice Papemy of the Alberta Court of Appeal held in Re Hover, Parliament does
not have the authority to impact provincial licences and permits through the BfA:
Clearly, the BfA has no provision for granting or revoking licenses. It was
not intended to fulfill this function. Moreover, any attempt would be
unconstitutional, the granting of licenses being a matter of provincial
jurisdiction, property and civil rights. Proper interpretation requires
consideration of the respective purpose, intents and effects of legislation,
and every effort must be made to give each its intended meaning. Thus, on
a bankruptcy, a professional body may lose the ability to collect a debt, but
it does not lose the ability to regulate the conduct of its members.
Reference:
85.
Hover at para. 47.
Simply put, if Parliament lacks the authority to expressly require the Registrar of Motor
Vehicles to issue a vehicle permit to Mr. Moore, it must also lack the authority to do so implicitly.
The Court of Appeal failed to address or even consider this issue as is required to determine
whether there is a conflict by way of a frustration of federal purpose.
- 28PART IV: SUBMISSIONS ON COSTS
86.
The Appellant requests its costs in this Court and below.
PART V: ORDER REQUESTED
87.
The Appellant 407 ETR respectfully requests that an Order be granted allowing the
appeal and restoring the Order of The Honourable Mr. Justice Newbould.
ALL OF WHICH IS RESPECTFULLY SUBMITTED this 18th day of September 2014.
Jon Laxer
LENCZNERSLAGHTROYCE
SMITH GRIFFIN LLP
Barristers
Suite 2600
130 Adelaide Street West
Toronto ON M5H 3P5
J. Thomas Curry (25740V)
Tel:
Fax:
(416) 865-3096
(416) 865-9010
Andrew Parley (55635P)
Tel:
Fax:
(416) 865-3093
(416) 865-2873
Jon Laxer (60765I)
Tel:
Fax:
(416) 865-2893
(416) 865-2978
Lawyers for the Appellant
29
PART VI - TABLE OF AUTHORITIES
Tab
Cases
Paragraph(s)
1
407 ETR Concession Co. v. Ontario (Registrar of Motor Vehicles)
(2005),82 O.R. (3d) 703, 214 O.A.e. 251 (Div. Ct.)
10
2
Blue Star Trailer Rentals Inc v. 407 ETR Concession Company Ltd, 2008 8
ONCA 561, 91 O.R. (3d) 321
3
Canada (Attorney General) v. Law Society of British Columbia, [1982] 2 37
S.e.R. 307
4
Canada (Attorney General) v. PHS Community Services Society, 2011
SCC 44, [2011] 3 S.e.R. 134
58
5
Canadian Western Bank v. Alberta, 2007 SCC 22, [2007] 2 S.C.R. 3
5(b), 28, 35,
39,59,72,82
6
Caporale (Re), [1970] 1 O.R. 37 (S.C.)
70
7
Chatterjee v. Ontario (Attorney General), 2009 SCC 19, [2009] 1 S.C.R. 28,31
624
8
Cooke v. Pilot Insurance Co. (1996), 68 A.C.W.S. (3d) 797, 24 O.T.e. 1 81
(Ont. Ct. J. (Gen. Div.))
9
GMAC Commercial Credit Corporation - Canada v. T C. T Logistics 74
Inc., 2006 SCC 35, [2006] 2 S.C.R. 123
10
Hover (Re), 2005 ABCA 101,251 D.L.R. (4th) 263
78,84
11
Multiple Access Ltd v. McCutcheon, [1982] 2 S.C.R. 161
31
12
Newfoundland and Labrador v. AbitibiBowater Inc., 2012 SCC 67, 69, 79
[2012] 3 S.C.R. 443
13
OPSEUv. Ontario (Attorney General), [1987] 2 S.e.R. 2
14
Provincial Secretary ofPrince Edward Island v. Egan, [1941] S.C.R. 396 46
15
Quebec (Attorney General) v. Canadian Owners and Pilots Association, 31,37,38,52,
2010 SCC 39, [2010] 2 S.C.R. 536
59
16
Reference re Securities Act, 2011 SCC 66, [2011] 3 SCR 837
34
17
Ross v. Registrar of Motor Vehicles, [1975] 1 S.C.R. 5
46
18
Shea v Fraser, 2007 ONCA 224,85 O.R. (3d) 28
67
19
Sun Indalex Finance LLC v. United Steelworkers, 2013 SCC 6, [2013] 1 37
S.C.R. 271
20
Vriend v. Alberta, [1998] 1 S.C.R. 493
34
55
Secondary Sources
21
L. W. Houlden & G. B. Morawetz, Bankruptcy and Insolvency Law of 65
Canada, loose-leaf (consulted on September 18, 2014) 4th ed. (Toronto:
30
Carswell, 2013)
22
P. W. Hogg, Constitutional Law of Canada, loose-leaf (consulted on 5(a),51
September 18, 2014) 5th ed. (Toronto: Carswell, 2007)
31
PART VII- LEGISLATION AT ISSUE
Legislation
Bankruptcy and Insolvency Act, R.S.C., 1985, c. B-3, SS. 72, 178
Loi sur la/aillite et l'insolvabilite, L.R.C. (1985), ch. B-3, SS. 72,178
Constitution Act, 1867,30 & 31 Victoria, c. 3 (U.K.), SS. 91, 92
Constitution Act, 1867,30 & 31 Victoria, ch. 3 (R.D.), SS. 91,92
Highway 407 Act, s.o. 1998, c. 28, s. 22
Loi de 1998 sur I 'autoroute 407, L.O. 1998, ch. 28, s. 22
32
Bankruptcy and Insolvency Act,
R.S.C., 1985, c. B-3
Application of other substantive law
72. (1) The provisions of this Act shall not be deemed to abrogate or supersede the substantive
provisions of any other law or statute relating to property and civil rights that are not in conflict
with this Act, and the trustee is entitled to avail himself of all rights and remedies provided by that
law or statute as supplementary to and in addition to the rights and remedies provided by this Act.
Operation of provincial law re documents executed under Act
(2) No bankruptcy order, assignment or other document made or executed under the authority of
this Act shall, except as otherwise provided in this Act, be within the operation of any legislative
enactment in force at any time in any province relating to deeds, mortgages, hypothecs, judgments,
bills of sale, chattel mortgages, property or registration of documents affecting title to or liens or
charges on real or personal property or immovables or movables.
R.S., 1985, c. B-3, s. 72; 1997, c. 12, s. 68(F); 2004, c. 25, s. 45.
Debts not released by order of discharge
178. (1) An order of discharge does not release the bankrupt from
(a) any fine, penalty, restitution order or other order similar in nature to a fine, penalty or
restitution order, imposed by a court in respect of an offence, or any debt arising out of a
recognizance or bail;
(a.1) any award of damages by a court in civil proceedings in respect of
(i) bodily harm intentionally inflicted, or sexual assault, or
(ii) wrongful death resulting therefrom;
(c) any debt or liability arising under a judicial decision establishing affiliation or respecting
support or maintenance, or under an agreement for maintenance and support of a spouse, former
spouse, former common-law partner or child living apart from the bankrupt;
(d) any debt or liability arising out of fraud, embezzlement, misappropriation or defalcation while
acting in a fiduciary capacity or, in the Province of Quebec, as a trustee or administrator of the
property of others;
33
(e) any debt or liability resulting from obtaining property or services by false pretences or
fraudulent misrepresentation, other than a debt or liability that arises from an equity claim;
(£) liability for the dividend that a creditor would have been entitled to receive on any provable
claim not disclosed to the trustee, unless the creditor had notice or knowledge of the bankruptcy
and failed to take reasonable action to prove his claim;
(g) any debt or obligation in respect of a loan made under the Canada Student Loans Act, the
Canada Student Financial Assistance Act or any enactment of a province that provides for loans or
guarantees of loans to students where the date of bankruptcy of the bankrupt occurred
(i) before the date on which the bankrupt ceased to be a full- or part-time student, as the case may
be, under the applicable Act or enactment, or
(ii) within seven years after the date on which the bankrupt ceased to be a full- or part-time student;
or
(h) any debt for interest owed in relation to an amount referred to in any of paragraphs (a) to (g).
Court may order non-application of subsection (1)
(1.1) At any time after five years after a bankrupt who has a debt referred to in paragraph (l)(g)
ceases to be a full- or part-time student, as the case may be, under the applicable Act or enactment,
the court may, on application, order that subsection (1) does not apply to the debt if the court is
satisfied that
(a) the bankrupt has acted in good faith in connection with the bankrupt's liabilities under the debt;
and
(b) the bankrupt has and will continue to experience financial difficulty to such an extent that the
bankrupt will be unable to pay the debt.
Claims released
(2) Subject to subsection (1), an order of discharge releases the bankrupt from all claims provable
in bankruptcy.
R.S., 1985, c. B-3, s. 178; R.S., 1985, c. 3 (2nd Supp.), s. 28; 1992, c. 27, s. 64; 1997, c. 12, s. 105
1998, c. 21, s. 103; 2000, c. 12, s. 18; 2001, c. 4, s. 32; 2004, c. 25, s. 83; 2005, c. 47, s. 107; 2007,
c. 36, s. 54.
34
Loi sur la famite et l'insolvabilite
L.R.C. (1985), ch. B-3
Application d'autres lois positives
72. (1) La presente loi n'a pas pour effet d'abroger ou de remplacer les dispositions de droit
substantif d'une autre loi ou regIe de droit concernant la propriete et les droits civils, non
incompatibles avec la presente loi, et Ie syndic est autorise a se prevaloir de tous les droits et
recours prevus par cette autre loi ou regIe de droit, qui sont supplementaires et additionne1s aux
droits et recours prevus par la presente loi.
Application de lois provinciales
(2) Nulle ordonnance de faillite, cession ou autre document fait ou souscrit sous l'autorite de la
presente loi n' est, sauf disposition contraire de celle-ci, assujetti a l' application de toute loi en
vigueur a toute epoque dans une province relativement aux actes, hypotheques, jugements, actes
de vente, biens ou enregistrements de pieces affectant Ie titre afferent aux biens, meubles ou
immeubles, personnels ou reels, ou les privileges ou charges sur ces biens.
L.R. (1985), ch. B-3, art. 72; 1997, ch. 12, art. 68(F); 2004, ch. 25, art. 45.
L'ordonnance de liberation ne libere pas des dettes
178. (1) Une ordonnance de liberation ne libere pas Ie failli :
a) de toute amende, penalite, ordonnance de restitution ou toute ordonnance similaire infligee ou
rendue par un tribunal, ou de toute autre dette provenant d'un engagement ou d'un cautionnement
en matiere penale;
a.l) de toute indemnite accordee en justice dans une affaire civile:
(i) pour des lesions corporelles causees intentionnellement ou pour agression sexuelIe,
(ii) pour deces decoulant de celles-ci;
b) de toute dette ou obligation pour pension alimentaire;
c) de toute dette ou obligation aux termes de la decision d'un tribunal en matiere de filiation ou
d'aliments ou aux termes d'une entente alimentaire au profit d'un epoux, d'un ex-epoux ou ancien
conjoint de fait ou d'un enfant vivant separe du failli;
d) de toute dette ou obligation resultant de la fraude, du detournement, de la concussion ou de
l'abus de confiance alors qu'il agissait, dans la province de Quebec, a titre de fiduciaire ou
d'administrateur du bien d'autrui ou, dans les autres provinces, atitre de fiduciaire;
35
e) de toute dette ou obligation resultant de l'obtention de biens ou de services par des
faux-semblants ou la presentation erronee et frauduleuse des faits, autre qu'une dette ou obligation
qui decoule d'une reclamation relative ades capitaux propres;
1) de l'obligation visant Ie dividende qu'un creancier aurait eu droit de recevoir sur toute
reclamation prouvable non revelee au syndic, a moins que ce creancier n'ait ete averti ou n'ait eu
connaissance de la faillite et n'ait omis de prendre les mesures raisonnables pour prouver sa
reclamation;
g) de toute dette ou obligation decoulant d'un prSt consenti ou garanti au titre de la Loi federale sur
les prSts aux etudiants, de la Loi federale sur l'aide financiere aux etudiants ou de toute loi
provinciale relative aux prSts aux etudiants lorsque la faillite est survenue avant la date alaquelle
Ie failli a cesse d'etre un etudiant, atemps plein ou atemps partiel, au regard de la loi applicable,
ou dans les sept ans suivant cette date;
h) de toute dette relative aux interets dus
al'egard d'une somme visee al'un des alineas a) ag).
Ordonnance de non-application du paragraphe (1)
(1.1) Lorsque Ie failli qui a une dette visee aI' aline a (1 )g) n' est plus un etudiant atemps plein ou a
temps partiel depuis au moins cinq ans au regard de la loi applicable, Ie tribunal peut, sur demande,
ordonner que la dette soit soustraite al'application du paragraphe (1) s'il est convaincu que Ie failli
a agi de bonne foi relativement a ses obligations decoulant de cette dette et qu'il a et continuera a
avoir des difficultes financieres telles qu'il ne pourra pas acquitter celle-ci.
Reclamations liberees
(2) Une ordonnance de liberation libere Ie failli de toutes autres reclamations prouvables en
matiere de faillite.
L.R. (1985), ch. B-3, art. 178; L.R. (1985), ch. 3 (2e suppl.), art. 28; 1992, ch. 27, art. 64; 1997, ch.
12, art. 105;1998,ch. 21, art. 103;2000,ch. 12, art. 18;2001,ch. 4, art. 32; 2004, ch. 25, art. 83;
2005,ch.47,art. 107;2007,ch. 36, art. 54.
36
Constitution Act, 1867
30 & 31 Victoria, c. 3 (U.K.)
Legislative Authority of Parliament of Canada
91. I t shall be lawful for the Queen, by and with the Advice and Consent ofthe Senate and House
of Commons, to make Laws for the Peace, Order, and good Government of Canada, in
relation to all Matters not coming within the Classes of Subjects by this Act assigned
exclusively to the Legislatures of the Provinces; and for greater Certainty, but not so as to
restrict the Generality of the foregoing Terms of this Section, it is hereby declared that
(notwithstanding anything in this Act) the exclusive Legislative Authority of the Parliament
of Canada extends to all Matters coming within the Classes of Subjects next hereinafter
enumerated; that is to say,
[ ... ]
21. Bankrupt cy and Insolvency.
[ ... ]
And any Matter coming within any of the Classes of Subjects enumerated in this Section shall not
be deemed to come within the Class of Matters of a local or private Nature comprised in the
Enumeration of the Classes of Subjects by this Act assigned exclusively to the Legislatures of the
Provinces. (47)
Subjects of exclusive Provincial Legislation
92. I n each Province the Legislature may exclusively make Laws in relation to Matters coming
within the Classes of Subjects next hereinafter enumerated; that is to say,
[ ... ]
9.
Shop, Saloon, Tavern, Auctioneer, and other Licences in order to the raising of a Revenue for
Provincial, Local, or Municipal Purposes.
10. Local Works and Undertakings other than such as are of the following Classes:
(a) Lines of Steam or other Ships, Railways, Canals, Telegraphs, and other Works and
Undertakings connecting the Province with any other or others ofthe Provinces, or extending
beyond the Limits of the Province:
(b) Lines of Steam Ships between the Province and any British or Foreign Country:
(c) Such Works as, although wholly situate within the Province, are before or after their
Execution declared by the Parliament of Canada to be for the general Advantage of Canada
or for the Advantage of Two or more of the Provinces.
13. Propert y and Civil Rights in the Province.
37
Constitution Act, 1867
30 & 31 Victoria, ch. 3 (R.U.)
Autorite legislative du pariement du Canada
91. I I sera loisible a la Reine, de l'avis et du consentement du Senat et de la Chambre des
Communes, de faire des lois pour la paix, I' ordre et Ie bon gouvemement du Canada,
relativement a toutes les matieres ne tomb ant pas dans les categories de sujets par la presente
loi exclusivement assignes aux legislatures des provinces; mais, pour plus de garantie, sans
toutefois restreindre la generalite des termes ci-haut employes dans Ie present article, il est
par la presente declare que (nonobstant toute disposition contraire enoncee dans la presente
loi) l'autorite legislative exclusive du parlement du Canada s'etend a toutes les matieres
tomb ant dans les categories de sujets ci-dessous enumeres, savoir :
[ ... ]
21. L a banqueroute et la faillite.
[ ... ]
Et aucune des matieres enoncees dans les categories de sujets enumeres dans Ie present article ne
sera reputee tomber dans la categorie des matieres d'une nature locale ou privee comprises dans
l'enumeration des categories de sujets exclusivement assignes par la presente loi aux legislatures
des provinces. (47)
Sujets soumis au controle exclusif de la legislation provinciale
92. Dans chaque province la legislature pourra exclusivement faire des lois relatives aux
matieres tomb ant dans les categories de sujets ci-dessous enumeres, savoir :
9.
L es licences de boutiques, de cabarets, d'auberges, d'encanteurs et autres licences, dans Ie
but de prelever un revenu pour des objets provinciaux, locaux, ou municipaux;
10. L es travaux et entreprises d'une nature locale, autres que ceux enumeres dans les categories
suivantes :
a) Lignes de bateaux a vapeur ou autres b§timents, chemins de fer, canaux, telegraphes et
autres travaux et entreprises reliant la province a une autre ou a d'autres provinces, ou
s' etendant au-dela des limites de la province;
b) Lignes de bateaux a vapeur entre la province et tout pays dependant de l'empire
britarruiquc au tout pays etra..'1ger;
c) Les travaux qui, bien qu'entierement situes dans la province, seront avant ou apres leur
execution declares par Ie parlement du Canada etre pour l' avantage general du Canada, ou
pour l'avantage de deux ou d'un plus grand nombre des provinces;
13. La propriete et les droits civils dans la province;
38
Highway 407 Act, 1998
S.O. 1998, c. 28
Failure to pay toll- non-validation of vehicle permit
22. (1) If a toll, and the related fees and interest, are not paid within 90 days ofthe day a
person receives a notice of failure to pay under section 16, the owner may notify the Registrar of
Motor Vehicles of the failure to pay. 1998, c. 28, s. 22 (1).
Method of giving notice
ill Any notice to the Registrar of Motor Vehicles under this section may be given in
writing, by direct electronic transmission or by any other prescribed method. 1998, c. 28, s. 22 (2).
Notification
ill The owner shall promptly inform the person who received notice of failure to pay
under section 16 that notice has been given to the Registrar of Motor Vehicles under subsection
(1). 1998, c. 28, s. 22 (3).
Registrar's action
ill If the Registrar of Motor Vehicles receives notice under subsection (1), he or she
shall, at the next opportunity, refuse to validate the vehicle permit issued to the person who
received the notice of failure to pay under section 16 and refuse to issue a vehicle permit to that
person. 1998, c. 28, s. 22 (4).
Same, if dispute
ill The Registrar of Motor Vehicles may act under subsection (4) even though the person
who received the notice of failure to pay under section 16 has disputed his or her obligation to pay
under section 17 or has appealed a decision of the owner under section 19. 1998, c. 28, s. 22 (5).
When toll is paid
@ If notice has been given to the Registrar of Motor Vehicles under subsection (1) and
the toll and related fees and interest are subsequently paid, the owner shall immediately notify the
Registrar ofthe payment. 1998, c. 28, s. 22 (6).
Same
ill Ifthe Registrar of Motor Vehicles is notified by the owner that the toll, fees and
interest have been paid or is notified by the dispute arbitrator that the person is not responsible for
paying the toll, fees and interest, the Registrar shall,
(a)
(4);
validate any vehicle permit that he or she refused to validate under subsection
(b)
issue a vehicle permit to a person if it was refused under subsection (4). 1998,
c. 28, s. 22 (7).
39
Loi de 1998 sur l'autoroute 407
L.O. 1998, Ch. 28
Defaut de payer Ie peage : non-validation du certificat d'immatriculation
22. (1) Si un peage et les fhis, droits et interets y afferents ne sont pas payes dans les 90 jours
de la reception d'un avis de defaut de paiement prevu a l'article 16 par une personne, Ie
proprietaire peut aviser Ie registrateur des vehicules automobiles de ce defaut de paiement. 1998,
chap. 28, par. 22 (1).
Methode de remise de l'avis
ill Tout avis au registrateur des vehicules automobiles vise au present article peut etre donne
par ecrit, par transmission electronique directe ou par toute autre methode prescrite. 1998, chap.
28, par. 22 (2).
Notification
ill Le proprietaire informe promptement la personne qui a reyu l'avis de defaut de paiement
prevu a l'article 16 que l'avis a ete donne au registrateur des vehicules automobiles en vertu du
paragraphe (1). 1998, chap. 28, par. 22 (3).
Mesures prises par Ie registrateur
ill S'il
reyoit l'avis prevu au paragraphe (1), Ie registrateur des vehicules automobiles, ala
pro chaine occasion, refuse de valider Ie certificat d'immatriculation de vehicule de livre a la
personne qui a reyu I' avis de defaut de paiement prevu a I' article 16 et refuse de lui delivrer un
certificat d'immatriculation de vehicule. 1998, chap. 28, par. 22 (4).
Idem, contestation
ill
Le registrateur des vehicules automobiles peut agir en vertu du paragraphe (4) meme si la
personne qui a reyu l'avis de defaut de paiement prevu a l'article 16 a conteste son obligation de
payer en vertu de l'article 17 ou a interjete appel d'une decision du proprietaire en vertu de l'article
19. 1998, chap. 28, par. 22 (5).
Moment du paiement du peage
®
Si un avis a ete donne au registrateur des vehicules automobiles en vertu du paragraphe (1) et
que Ie peage et les frais, droits et interets y afferents sont payes par la suite, Ie proprietaire avise
immediatement Ie registrateur de ce paiement. 1998, chap. 28, par. 22 (6).
Idem
ill S'il est avise par Ie proprietaire que Ie peage et les frais, droits et interets ont ete payes ou
qu'il est avise par l'arbitre des differends que la personne n'est pas redevable du paiement de
ceux-ci, Ie registrateur des vehicules automobiles:
a) vali de tout certificat d'immatriculation de vehicule qu'il a refuse de valider aux termes du
paragraphe (4);
b) de livre un certificat d'immatriculation de vehicule a une personne si celui-ci lui a ete refuse
aux termes du paragraphe (4). 1998, chap. 28, par. 22 (7).
OS/27/2814
14:30
6139'369138
REGISTRY-GREFFE
Supreme Court of Canada
Cour suprarna du Canada
Ie 27 juin 2014
June 27, 2014
ORDER
MOTION
407 ETR CONCESSION
BANKRUPTCY
(Ont.) (35696)
PAGE
QRDONNANCE
REQUiTE
COMPANY
LIMITED
v.
StTPEIUNTENDENT
OF
THE CHIEF JUSTICE:
UPON APPLICATION by the
~ppellant
fot an order stating a constitutional question in the
a.bove appeal;
AND THE MATERIAL ~EDhaving been read;
IT IS HEREBY ORDERED THAT THE CONSTITUTIONAL QUESTION BE STATED
AS FOLLOWS:
.
1. Is s. 22(4) of the Highway, 407 Act, 1998.8.0. 1998,
C. 281 constitutionally inoperative
unde:r the doctrine of fede'ra11egislative paramountcy. having regwd to the Bankruptcy
and Insolvency Act, R.S.C. 1985, c. B-3?
...
Any attorney general who intervenes pursuant to par. 61(4) ofilie :Rules o/the Supreme Court of
Canada shall pay the appellant and respondent the costs of any additional disbursements they
incur as a result of the intervention.
IT IS HEREBY FURTHER ORDERED THAT:
A:ny attorney general wishing to intervene pursuant to par, (j l (4) ofilie Rules afthe Supreme Court
0/ Canada shall serve and £ile their factum and book of authorities no later than December 19,
2014.
02/03
06/27/2014
14:30
6139969138
REGISTRV-G.G1EFFE
PAGE
2
A LA SUITE DE LADEMANDE de l'appelao.te visant aootenir la formulation d'uue question
constitutionnelle dans l'appel susmentionne;
ET APRES AVOIR LU la documentation deposee,
LA QUESTION CONSTITUTIONNELLE SUIVANTE EST FORMUL:EE :
1. Le paragraphe 22(4) de la Highway 407 Act, 1998, L.O. 1998. ch. 28, est-il inopetant sur
Ie plan constitutionnel en xaison de la doctrine de la preponderance des lois £ed,erales. au
regard de laLoi sur la/aillite et l'insolvabilite, L.R.C. 1985, ch. Bw3?
Tout procureur general qui interviendra en vertu du par. 61(4) des Regles de 1a Cow' s.upreme du
Canada sera tenu de payer a l'appelante et a l'intime les depens supplementai.res :resultant de son
intervention.
lL EST EN OUTRE ORDONNE CE QUI SUIT:
Tout procureur general qui interviendra en vertu du par. 61(4) des RegZes de {(1, Cour supreme du
Canada devra signifier et depos~t son memoire et son xecueil de sources au. pill..';; tard Ie 19
decembre 2014.
~
C..1.C.
J.C.C.
03/03

Download Report