Skip to content

Nothing fishy here: Federal Court dismisses application for judicial review in PIIFCAF case

Jennifer Taylor

Introduction

Kirby Elson had been fishing in Newfoundland and Labrador for about 50 years when the policy on Preserving the Independence of the Inshore Fleet in Canada’s Atlantic Fisheries (“PIIFCAF”) was introduced in 2007. Concerned it would cause him to lose his fishing enterprise, he sought an exemption from complying with PIIFCAF. After various procedural steps, the matter ended up in Federal Court as an application for judicial review of Fisheries Minister Hunter Tootoo’s December 2015 decision that the Applicant’s exemption request should be denied (accepting a recommendation of the Fisheries Licence Appeal Board).

In an 86-page decision reported as Elson v Canada (Attorney General), 2017 FC 459, Justice Strickland has dismissed the application and upheld the Minister’s denial. This means the Applicant no longer has valid fishing licences.

Not only is this decision important for the fishing industry in Atlantic Canada, but it also takes a broader look at the extent of, and limits on, the Minister’s discretion over fishing licences under section 7 of the Fisheries Act.

PIIFCAF and controlling agreements

PIIFCAF was intended “to reaffirm the importance of maintaining an independent and economically viable inshore fleet; strengthen the application of the Owner-Operator and Fleet Separation Policies; ensure that the benefits of fishing licences flow to the fish harvester and the coastal community; and, assist fish harvesters to retain control of their fishing enterprises.”1

As a result of PIIFCAF, an Atlantic fish harvester would only be eligible for a new or replacement licence if they were not party to a “controlling agreement.” A controlling agreement is a form of trust agreement that lets someone other than the licence holder (say, a fish processing company) make decisions about licence transfers.

The Applicant had been in a controlling agreement with Labrador Sea Products Inc. and Quinlan Brothers Limited since 2003. In 2007, PIIFCAF gave licence holders in controlling agreements seven years to comply. At the end of 2014, the Applicant was still in his controlling agreement. As mentioned, he unsuccessfully tried to seek an exemption from PIIFCAF so he could remain in the controlling agreement arrangement.

The Minister’s exercise of discretion

The legal issues on judicial review were whether the Minister (1) based his decision on irrelevant factors; (2) fettered (improperly limited) his discretion; or (3) had a closed mind when considering the Applicant’s request for an exemption.

(1) Irrelevant factors?

The Applicant argued that PIIFCAF was an irrelevant consideration because, he said, the policy itself was actually unconstitutional. The Applicant framed PIIFCAF’s requirement for fish harvesters to get out of controlling agreements as an improper interference with the provincial power over the regulation of contracts.

Justice Strickland disagreed, finding that the Minister had the discretion to “consider social, cultural or economic goals or policies when deciding whether or not to issue fishing licences”2 as part of the federal power over fisheries. PIIFCAF, she found, was meant to achieve these kinds of objectives in Atlantic Canada.

As Justice Strickland explained: “the Minister had determined that controlling agreements, which were devised to defeat the existing licencing policies, resulted in negative socio-economic consequences for coastal communities.3

Furthermore, Justice Strickland noted that PIIFCAF, as a policy and not legislation or a regulation, could not actually “be subject to a division of powers challenge.”4 (There was no constitutional challenge to section 7 of the Fisheries Act, which grants the Minister extremely broad discretion over fishing licences and related issues.)

Justice Strickland found PIIFCAF “does not frustrate contracts”; licence holders still have wide contractual freedom: “it does not prevent licence holders from entering into contracts, obtaining financing, using their licence as collateral, supplying their catch to whomever they wish or otherwise organizing their business affairs as they see fit.”5

(2) Fettered discretion?

The mandatory nature of PIIFCAF, and the absence of exemptions for individual harvesters, did not fetter the Minister’s discretion, according to Justice Strickland. The Applicant had the opportunity to seek an individual exemption from the Minister, through correspondence with DFO and through the Appeal Board process. But although the Applicant’s position was that a controlling agreement was the only way he could afford to keep fishing, he had not submitted any supporting financial or other evidence during that process.

This was not the end of Justice Strickland’s analysis, however. She ended up finding that the Minister had fettered his discretion after all.

In particular, she found a flaw in the Minister’s decision letter from December 2015 indicating that he’d improperly limited his discretion by concentrating on PIIFCAF and not explicitly relying on the Fisheries Act as a source of his decision-making authority: “the Minister’s decision letter failed to acknowledge the source and breadth of his broad discretion under section 7 of the Fisheries Act, referring only to the PIIFCAF Policy. He thereby fettered his discretion by not also considering that it was open to him to afford the relief sought other than by way of the PIIFCAF Policy and the appeal process.”6

(3) Closed mind?

Despite her conclusion that the Minister fettered his discretion, Justice Strickland found that the Applicant had not met the stricter test to show that the “Minister’s mind was closed”;7 the Minister had not prejudged the issue before it came to him, even though he decided against the Applicant.

Remedy

Justice Strickland relied on a Federal Court of Appeal decision holding that a “decision that is the product of a fettered discretion must per se be unreasonable.”8 Importantly, however, that did not automatically result in a remedy for Mr. Elson. This is because of Justice Strickland’s finding that the available remedy—returning the matter to the Minister—would not have made any difference to the result.

The Applicant did not meet the requirements of PIIFCAF, and the Minister would still have the discretion to deny him an exemption, so Justice Strickland decided there was no point in sending it back.

This decision could yet be appealed.

In the meantime, PIIFCAF continues to apply – and continues to prevent Mr. Elson from fishing his licences if he remains party to a controlling agreement.

This update is intended for general information only. If you have questions about how this case may affect you, please contact our fisheries law practitioners Will Moreira, QC, FCIArb and Sadira Jan in Halifax, or Kim Walsh in St. John’s.


1 Paragraph 6.
2 Paragraph 51.
3 Paragraph 72.
4 Paragraph 56.
5 Paragraph 73.
6 Paragraph 135.
7 Paragraph 146.
8 Paragraph 153 (see also paragraph 25).

SHARE

Archive

Search Archive


 
 

New Brunswick’s new Enduring Powers of Attorney Act

August 10, 2020

Gerald McMackin, QC and Christopher Marr, TEP New Brunswick joined the rest of Canada in enacting legislation that deals solely with powers of attorney when the Enduring Powers of Attorney Act (“Act”) came into force…

Read More

Prince Edward Island Labour and Employment legislative changes

July 31, 2020

Murray Murphy, QC, CPHR and Kate Jurgens Three new bills have been introduced in the most recent sitting of the Prince Edward Island legislature. In the employment setting Bill 38 aims to address the prevalence…

Read More

Game over for waiver of tort

July 27, 2020

Jennifer Taylor   The Supreme Court of Canada has finally put an end to the “waiver of tort” debate.   After years of uncertainty, a majority of the Court confirmed in Atlantic Lottery Corp Inc…

Read More

COVID-19 – potential liability for municipalities

July 21, 2020

Stephen Penney and Justin Hewitt As municipalities begin opening up recreational facilities in Alert Level 2 of the COVID-19 public health emergency implemented by the Provincial Government, Municipalities Newfoundland and Labrador has been receiving inquiries…

Read More

Applicability of business tax where operations limited

July 21, 2020

There is no obligation upon a municipality to reduce a business tax due to limited operations secondary to the COVID-19 pandemic. A municipality does, however, have the discretion to offer business tax relief. If a…

Read More

You’re more essential than you think: it is crunch time for Newfoundland and Labrador employers to avail of Essential Worker Support Program

July 9, 2020

Ruth Trask and John Samms Newfoundland and Labrador employers who continued operations this spring during Alert Levels 4 and 5 of the COVID-19 pandemic should take note of a new program offered by the provincial…

Read More

New Brunswick regulator seeks input on changes to defined benefit pension plan funding

July 8, 2020

Christopher Marr, TEP & Lauren Henderson As defined benefit pension plans (“DB Plans”) throughout Canada continue to face funding challenges due to mounting solvency deficits, the New Brunswick Financial and Consumer Services Commission (“FCNB”) is…

Read More

Downey v Nova Scotia: clarifying the process under the Land Titles Clarification Act

July 8, 2020

Jennifer Taylor   The Supreme Court of Nova Scotia has acknowledged the ongoing impact of systemic racism against African Nova Scotians in an important decision on the Land Titles Clarification Act (“LTCA”).   The case,…

Read More

Entry of business persons to Canada under CUSMA

July 3, 2020

Effective July 1, 2020, the North American Free Trade Agreement (“NAFTA”) was officially replaced by the Canada-United States-Mexico Agreement (“CUSMA”). Like NAFTA, CUSMA contains provisions for the temporary entry of foreign “business persons” to Canada…

Read More

The Supreme Court of Canada paves the way for class action lawsuit against Uber

June 26, 2020

Killian McParland and Jennifer Thompson In a decision released earlier today, Uber Technologies Inc. v. Heller¹, the Supreme Court of Canada determined that an agreement requiring Uber drivers to go to arbitration instead of suing…

Read More

Search Archive


Scroll To Top