Date: 20001121
Docket: T-382-99
BETWEEN:
RADIL BROS. FISHING CO. LTD.
Plaintiff
(Respondent)
- and -
HER MAJESTY THE QUEEN IN RIGHT OF CANADA, as represented by the REGIONAL DIRECTOR GENERAL OF THE DEPARTMENT OF FISHERIES AND OCEANS, FOR THE PACIFIC REGION, and
Defendant
(Moving Party)
BRITISH COLUMBIA PACKERS LIMITED and TITAN FISHING LTD.
Defendants
REASONS FOR ORDER
McKEOWN J.
[1] The Defendant, Her Majesty the Queen in Right of Canada appeals the Order of Prothonotary Hargrave wherein he dismissed the Defendant's motion which sought to have the Plaintiff's Statement of Claim and the declaratory relief sought in the Statement of Claim struck out and to have the proceedings stayed.
[2] The standard of review on appeal is set out in Canada v. Aqua-Gem Investments Limited, [1993] 2 F.C. 425 (C.A.), where the Court of Appeal decided that discretionary orders of prothonotaries ought not to be disturbed on appeal, unless they are clearly wrong in the sense that the exercise of discretion was based upon a wrong principle or misapprehension of the facts, or they raise questions vital to the final issue of the case. In either of these two instances, the reviewing judge ought to exercise his discretion de novo.
FACTS
[3] Radil has two proceedings in this Court. The first, T-192-98, for judicial review, which I will refer to as the "first proceeding", has now been transformed into an action. These reasons apply to Court File No. T-382-99.
[4] Radil is the owner of the fishing vessel "SEACREST", an eighty-six foot fishing vessel used to fish for groundfish. To engage in groundfish fishing, a trawl fishery, the vessel must have what is known as a "T" licence. The licence is issued by the Department of Fisheries and Oceans (DFO). Once issued, the licence is valid for a year. The vessel owner or its representative must apply every year for re-issuance. In 1986, Radil purchased the vessel "SEACREST", together with the T.8 licence and engaged in the groundfish fishery using that licence until 1993.
[5] In January of 1993, the Defendant, B.C. Packers, made an application for the T.8 licence on behalf of Radil. The nature of the relationship between B.C. Packers and the Plaintiff may be described as reciprocal. It was and is not uncommon for fish processing companies, such as B.C. Packers was at material times, to assist their fishermen in administrative and licensing matters, with a view to obtaining a secure supply of fish. In August of the same year, Radil made further arrangements with B.C. Packers to purchase an "A" licence held by the "PACIFIC EAGLE". In effect B.C. Packers made an application in that respect and the "A" licence held by the "PACIFIC EAGLE" was duly transferred to the "SEACREST", yet the matter was not quite that simple.
[6] The "PACIFIC EAGLE" initially had what is known as an "AT" licence, a combined or married form of "T" and "A" licences, the "T" licence portion issued to the "PACIFIC EAGLE" being the T.92 licence. According to the DFO, it was and is contrary to its policy to allow such "married" form of licences to be "divorced" from each other and transferred individually. The DFO says that it so advised B.C. Packers and further advised that the entire "AT" licence must be transferred.
[7] B.C. Packers contends that it raised a concern with the DFO regarding the transfer of catch history, but having assurance from the late Mr. Stephen Brownlee, then Director of Licensing for the DFO, that the transfer would not affect the catch history of each of the vessels, the parties ceased to discuss the issue. B.C. Packers say that it informed Radil of the problem as well as Mr. Brownlee's assurance, and went on to effect the transfer which acquired the "A" licence and swapped the T.8 and T.92 licences.
[8] In 1995, Titan purchased the "PACIFIC EAGLE" and the attached T.8 licence. At the time of the purchase there was still a general prediction by those in the industry that Individual Vessel Quotas (IVQ) would be introduced and this prediction seemed to be reinforced by the establishment of a new Groundfish Trawl Management Plan. IVQ would in fact allocate the amount of groundfish each vessel would be allowed to catch. The IVQ, as eventually implemented, was based 70% on average catch history during the five year period between 1988 to 1992 and 30% on vessel length.
[9] The information used by the DFO to calculate the IVQ allocation for Radil's vessel "SEACREST" was enclosed with the letter dated March 18, 1997. Radil says that it was the first time it realized that the "T" licence issued to the "SEACREST" was the T.92 licence and someone else's catch history and not the T.8 licence with Radil's own catch history. Radil then realized that the IVQ of the "SEACREST" was calculated according to the catch history of the "PACIFIC EAGLE", and was substantially lower than it would otherwise have been.
[10] Radil immediately inquired of the DFO with respect to the IVQ calculation. The DFO confirmed that the transfer effected in 1993 was not only a swap of the licences, but also of the catch histories. Radil then wrote to the DFO requesting that the T.8 licence be issued to it, and that the IVQ of "SEACREST" be adjusted accordingly, but to no avail.
[11] Receiving no response from DFO, Radil initiated the first proceeding, an application for judicial review. In its application Radil sought an order of mandamus requiring the DFO to make a decision as to the issuance of the T.8 licence to the Plaintiff for the 1998-99 year; a declaration that the transfer of the T.8 licence was unauthorized, illegal, invalid or otherwise ineffective and that the Plaintiff was the rightful holder of the T.8 licence; and a declaration that Radil was entitled to be issued the T.8 licence for 1998-99 fishery together with an IVQ based on Radil's catch history as owner and user of the "SEACREST".
[12] On February 23, 1998, Titan brought a motion in regard to the first proceeding seeking an order striking out Radil's application as an abuse of process or, in the alternative to have the application treated and proceeded with as an action. Mr. Justice Campbell directed that the matter proceed as an action, but dismissed Titan's motion to strike out, for the matter, in his opinion, contained a serious issue to be tried.
[13] Pursuant to Mr. Justice Campbell's order regarding the first proceeding, Radil subsequently filed a Statement of Claim, seeking relief both similar and parallel to that initially sought through judicial review in the first proceeding. Radil sought not only the original declaratory relief, but also damages on various grounds. Titan then brought a motion for a summary judgment seeking an order dismissing Radil's claims for declaratory relief against Titan and the Crown. Mr. Justice Rouleau dismissed Titan's application for a summary judgment, but ordered that the damage-seeking part of the relief be struck out, for it was not part of the relief initially sought by judicial review. The portion of the reasons dealing with this aspect is instructive. He states at paragraph 15:
| A motion for summary judgment is not intended, and should not be treated, as a substitute for a trial. In determining whether a trial is unnecessary and would serve no purpose, a motions judge has a restricted function and must guard against assuming the role of a trial judge and deciding the issues between the parties. Provided a genuine issue exists with respect to the material facts, it matters not how weak or strong the impugned claim or defence may be. The case should proceed to a trial in order that the issue may be resolved by the trial judge. Accordingly, summary judgment should only be granted in the clearest of cases. |
and subsequently at paragraph 22:
| However, the conversion of a judicial review application into an action does not entitle the plaintiff to subsequently file a Statement of Claim wherein different relief is sought than that set out in the Originating Notice of Motion. The purpose of Rule 18.2(4) is to permit a judicial review application to be proceeded with as if it were an action; that is, with discoveries, and the presentation of witnesses and their viva voce evidence. It does not create a new cause of action nor does it permit a party to seek new or additional relief than that originally sought. |
In effect, an applicant with a judicial review proceeding cannot, on becoming a plaintiff in the same proceeding, in the form of an action, seek new relief. Rather, as plaintiff, the claimant has the full advantage of trial procedure including discovery and witnesses, by which to obtain the original relief sought. Faced with this bar to relief by way of damages, Radil amended its Statement of Claim removing the plea for damages.
[14] On March 5, 1999 the present action was commenced by the Plaintiff claiming damages against Her Majesty the Queen and British Columbia Packers based on the same factual circumstances. The Statement of Claim is identical in its perimeter of fact and law except that it seeks damages in addition to the declaratory relief sought in the first proceeding. On March 17, 1999 the Plaintiff also brought an action in the Supreme Court of British Columbia on the same facts, against the same parties, and seeking the same declarations and damages from the Defendant.
[15] On June 16, 1999 this Court ordered that this action and action T-192-98 be heard at the same time or one immediately following the other as the trial judge may determine, as questions of law and fact arise in both actions and the rights of relief claimed in both actions arise in respect of the same series of transactions. The Court also ordered that both actions be managed as specially managed proceedings.
[16] The Defendant, Her Majesty the Queen, then applied in this motion to strike out the Plaintiff's Statement of Claim pursuant to Rules 4, 208 and 221 or in the alternative for an order pursuant to section 50 of the Federal Court Act, R.S.C. 1985, c.F-7 that the proceeding be stayed. I note that the Queen has not filed a Statement of Defence in this action. On June 16, 1999 Prothonotary Hargrave denied the motions of Her Majesty the Queen to strike out the Plaintiff's Statement of Claim or in the alternative stay the proceedings.
[17] On June 25, 1999, the Plaintiff filed an amended Statement of Claim, and on that same day the Defendant filed a motion to strike this amended Statement of Claim. The Defendant, Her Majesty the Queen, took no further steps in pursuing this motion. On February 25, 2000, by request of the Plaintiff, a case management conference for May 31, 2000 was set for the hearing of this motion.
[18] The Defendant submits that the Orders made by Prothonotary Hargrave are clearly wrong because they are based on wrong principles and on improper application of case law.
[19] I will now determine whether the prothonotary erred in holding the Federal Court Trial Division had the jurisdiction to consider an application for declaratory relief in the nature of judicial review against the Minister pursuant to sections 18 and 81.1 of the Federal Court Act initially commenced by way of Statement of Claim.
[20] In its Statement of Claim, the Plaintiff sought the following declaratory relief against the Defendant Crown:
| (a) a declaration that the purported transfer of the T.8 licence in 1993 was unauthorized, illegal, invalid, or otherwise ineffective and that the Plaintiff is the rightful holder of the licence; |
| (b) a declaration that the Plaintiff is entitled to be issued the T.8 licence and is entitled to the Individual Vessel Quota issued to that licence; and |
| (c) in the alternative, a declaration that the Plaintiff is entitled to the Individual Vessel Quota based on the catch history of the "SEACREST". |
During the hearing before the prothonotary the Plaintiff abandoned the declaratory relief it sought in items (a) and (b) against the Defendant Crown. In refusing to strike out the portion of the prayer for relief seeking declaratory relief as against the Crown, the prothonotary concluded that this Court had jurisdiction to consider granting such relief in proceedings commenced by way of Statement of Claim. Prothonotary Hargrave stated that he would have agreed with the analysis of the Minister that declaratory relief against the Crown must be sought only by judicial review "had not counsel for Radil pointed to the use of declaratory relief by Mr. Justice Joyal to suggest to the minister how discretion might be exercised in a fishing licence matter." He based this comment on an action involving a fishing licence in Johnson v. Ramsay Fishing Co., [1987] 47 D.L.R. (4th) 544 (F.C.T.D.). However, Johnson, supra was decided under the Federal Court Act in force in 1987. In 1987 the Federal Court Act did not contain the present sections 18(3) and 18.1 which make it mandatory that declaratory relief against a federal board, commission or other tribunal be commenced only through an application for judicial review. Whereas in 1987, Rules 400 and 600(4) provided that declaratory relief against a Minister had to be brought by action, not by an originating notice of motion as the current Rules require. Furthermore, the former Federal Court Rules were rules of the Court. Sections 18(3) and 18.1 of the Federal Court Act were enacted by Parliament. The Federal Court of Appeal approved this approach in Lake Babine Indian Band et al. v. Williams et al. (1996), 194 N.R. 44 where the appeal was allowed from a decision of the trial judge dismissing a motion to strike the statement of claim. Robertson J.A. stated that:
| this court has jurisdiction to address the issue but it can do so only in the context of a s. 18 application, not in the context of an action initiated by way of statement of claim. The appellants' motion under rule 419(1)(a) to strike the respondents' statement of claim, because in the context of an action the court could not grant the relief sought, is well-founded. It is also well-founded in another respect. There appears to be no possibility to convert an action into an application for judicial review in view of s. 18.4(2) of the Federal Court Act, but even if the law were otherwise, the court would be denied jurisdiction to entertain the application. The 30-day limitation period prescribed by s. 18.1(2) of the Act is long past due. |
[21] Prothonotary Hargrave himself recognized the effect of the 1992 Federal Court Act in his decision in Lameman et al. v. Gladue et al. (1995), 95 F.T.R. 220, when he stated at paragraph 12:
| In the present instance, the proceeding, an action seeking injunctive and declaratory relief which, before the 1992 amendments to the Federal Court Act, would have been a correct option, but which now contravenes the Act. Further, unless either the action can be deemed an originating notice of motion, or the thirty-day limitation for commencing the proceedings, under s. 18.1(2) can be extended, the plaintiffs will not be able to obtain review leading to possible relief. |
He went on to state the following at paragraph 15:
| While I have in mind the philosophy of the court, that rules and procedure as applied by the court ought to facilitate the normal advancement of cases, I have difficulty deeming the proceedings, which are in direct conflict with the Act, to be something which they are not. Rules of court are procedural. This court has the discretion to temper its Rules as may be appropriate and necessary in the interests of justice. But provisions in an act, the 1992 amendments to the Federal Court Act in this instance, have both a stronger and a different force and can affect both procedure and substance. |
He reviews several other Federal Court cases that were to the same effect.
[22] Accordingly, the prothonotary was clearly wrong in not striking out the declaratory relief and I will strike out paragraphs (a), (b) and (c) of the prayer for relief in the amended Statement of Claim issued June 25, 1999 subsequent to the prothonotary's decision.
[23] I will next proceed to whether the prothonotary erred in holding that the test for a reasonable cause of action is whether or not an exercise of ministerial discretion or a minister's administrative decision is reviewable. Rule 221(1) of the Federal Court Rules provides for striking out pleadings in an action:
| 221(1) on motion, the Court may, at any time, order that a pleading, or anything contained therein, be struck out, with or without leave to amend, on the ground that it |
| (a) discloses no reasonable cause of action or defence, as the case may be, |
| (b) is immaterial or redundant, |
| (c) is scandalous, frivolous or vexatious, |
| (e) constitutes a departure from a previous pleading, or |
| (f) is otherwise an abuse of the process of the Court, |
| and may order the action be dismissed or judgment entered accordingly. |
[24] The prothonotary, however, states at paragraph 30 of his reasons:
| If a pleading contains no reasonable cause of action based on the facts as stated in the statement of claim or defence, the pleading will fail from the outset. One need not look further into other indicia in the Rule 221(1). See Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959. Conversely, if the Plaintiff demonstrates that the pleading contains a legitimate question to be argued that may well obviate having to examine the pleading in the light of the other tests under Rule 221. For example, a pleading containing a reasonable cause of action can hardly be said to be frivolous or an abuse of process of the court. |
[25] However, Her Majesty the Queen alleges that the prothonotary erred when he stated at paragraph 31:
| Where the minister of the Crown exercised discretion in administrative capacity and the decision is challenged, the test to be met for a reasonable cause of action is whether the minister's decision is reviewable. If the decision is not reviewable, the plaintiff has no reasonable cause of action. |
[26] The availability of procedural review of ministers' administrative decisions pursuant to the Federal Court Act creates a judicial review procedure, but it does not create a cause of action. The prothonotary started his inquiry by asking whether or not the minister's discretionary decision was reviewable. Instead, he should have first asked whether or not the Statement of Claim disclosed any cause of action. The test on striking out proceedings is whether it is plain and obvious that the claim discloses no reasonable cause of action. The Supreme Court of Canada stated in Hunt v. Carey Canada Inc., supra at 980:
| As in England, if there is a chance that the plaintiff might succeed, then the plaintiff should not be `driven from the judgment seat'. Neither the length and complexity of the issues, the novelty of the cause of action, nor the potential for the defendant to present a strong defence should prevent the plaintiff from proceeding with his or her case ... |
The Supreme Court then went on to state at 989:
| It is not for this Court on a motion to strike out one way or the other as to the plaintiff's chances of success. As the law that spawned the "plain and obvious" test makes clear, it is enough that the plaintiff has some chance of success. |
[27] The Plaintiff refers to cases where a decision is reviewed under judicial review procedure and is then followed by an action for damages. However, no judicial review procedure concerning this matter has been completed prior to this cause of action.
[28] In determining whether the Statement of Claim should be struck out, it is important to remember the function of pleadings. In Harry v. The Queen (13 November 1990), Vancouver C944747 (B.C.S.C.), Smith J. states at paragraphs 5 and 6:
| The ultimate function of pleadings is to clearly define the issues of fact and law to be determined by the court. The issues must be defined for each cause of action relied upon by the plaintiff. That process is begun by the plaintiff stating, for each cause, the material facts, that is, those facts necessary for the purpose of formulating a complete cause of action: Troup v. McPherson (1965), 53 W.W.R. 37 (B.C.S.C.) at 39. ... |
| A useful description of the proper structure of a plea of a cause of action is set out in J.H. Koffler and A. Reppy, Handbook of Common Law Pleading, (St. Paul, Minn.: West Publishing Co., 1969) at p. 85: |
| Of course the essential elements of any claim of relief or remedial right will vary from action to action. But, on analysis, the pleader will find that the facts prescribed by the substantive law as necessary to constitute a cause of action in a given case, may be classified under three heads: (1) The plaintiff's right or title; (2) The defendant's wrongful act violating that right or title; (3) The consequent damage, whether nominal or substantial. And, of course, the facts constituting the cause of action should be stated with certainty and precision, and in their natural order, so as to disclose the three elements essential to every cause of action, to wit, the right, the wrongful act and the damage. |
[29] An action based only on the availability of judicial review does not disclose any cause of action known in law.
[30] The next questions to be considered are: 1. Whether or not a right of action arises to the Plaintiff under the causes of action pleaded in paragraphs 23, 28, 39 and 40 of the amended Statement of Claim?; and 2. Is there any other cause of action made out from the material facts pleaded? I will set out paragraphs 23, 28, 39 and 40:
| 23. The Defendant, B.C. Packers, was negligent and in breach of its duty to the Plaintiff, in that it failed to properly record or document the agreement reached with the DFO and failed to take the steps necessary to ensure that when the IVQ system was introduced, the catch history of the "SEACREST" would remain with the "SEACREST". |
| 28. The 1997/1998 Management Plan provided that the IVQ allocation formula for groundfish trawl was to be based 70% on average catch of groundfish during the five year period 1988-1992 and 30% on vessel length... |
| 39. The DFO was negligent in authorizing and processing the transfer of licence `T' 0008 from the "SEACREST" without receiving proper or any authorization from the Plaintiff. |
| 40. The DFO owed a duty to the Plaintiff not to transfer the licence which the Plaintiff was entitled to unless done in compliance with the Fisheries Act, R.S.C. the Regulations and policies thereto. The DFO was negligent and breached its duty to the Plaintiff in failing to follow its own Regulations and policies in that they processed the application to transfer licence `T' 0008 when they knew, or ought to have known, that the transfer did not comply with the Regulations and Departmental policy and the documentation required to effect the transfer was not complete. |
[31] The primary claim of the Plaintiff is a right to a fishing licence and a particular quota. The damages flow, as the Plaintiff submits, from not receiving the fishing licence and quota. The subject matters that are raised in the Statement of Claim are covered in the Fisheries Act, R.S.C. 1985, c.F-14 and the Regulations thereto. Section 7 of the Fisheries Act provides that the Minister has absolute discretion in granting fishing licences and the term of such licence cannot exceed nine years. Section 43 of the Act provides the Governor-in-Council may make regulations:
| (g) respecting the terms and conditions under which a licence and lease may be issued.
|
(g) concernant les conditions attachées aux licences, permis et baux;
|
| Section 22 of the 1993 Pacific Fisheries Regulation, S.O.R. 93-54, provides that the Minister may prescribe the species of fish in respect of which a licence is issued. Section 22 states: |
| 22. (1) No person shall use a vessel, and no owner or lessee of a vessel shall permit the use of that vessel, in commercial fishing for any species of fish unless |
| (a) subject to subsection (2), the vessel is registered; and |
| (b) the use of the vessel to fish for that species of fish is authorized by a commercial fishing licence. |
| [32] Strayer J. in Joliffe v. The Queen, [1986] 1 F.C. 511 (T.D.) at 520 points out that there is no property right in a fishing licence. He states at 520: |
| While there is a good deal of force in the contention of the plaintiffs that licences, because they have a recognized commercial value and are frequently bought and sold, should be regarded as vesting in their holders a right which is indefeasible except (as contemplated by section 9 of the Act) where there has been a breach of the conditions of the licence, I am unable to find support for that conception of licences in the Act or Regulations. First, it must be underlined that no matter what the popular belief on the subject, by sections 34 and 37 of the Regulations no licence is valid for more than one year and expires as of March 31 in any given year. It is true that by section 9 of the Act the Minister's power to cancel licences is restricted to situations where there has been a breach of a condition of the licence, and no doubt in exercising that power of cancellation the Minister or his representatives would have to act fairly: see Lapointe v. Min. of Fisheries & Oceans (1984), 9 Admin. L.R. 1 (F.C.T.D.). But licences terminate each year and by section 7 the Minister has an "absolute discretion" in the issuance of new licences. I am therefore unable to find a legal underpinning for the "vesting" of a licence beyond the rights which it gives for the year in which it was issued. |
| Strayer J.'s said quote was specifically approved by Major J. in Comeau's Sea Foods Ltd. v. Canada (Minister of Fisheries and Oceans), [1997] 1 S.C.R. 12 at 24 where he stated: |
| Joliffe held that there is no such thing as a vested right in a licence beyond those rights granted for the period for which the licence was issued. |
| He then goes on and quotes Strayer J. as set out above. He then states at 25: |
| It is my opinion that the Minister's discretion under s. 7 to authorize the issuance of licences, like the Minister's discretion to issue licences, is restricted only by the requirement of natural justice, no regulations currently being applicable. The Minister is bound to base his or her decision on relevant considerations, avoid arbitrariness and act in good faith. The result is an administrative scheme based primarily on the discretion of the Minister: see Thomson v. Minister of Fisheries and Oceans, F.C.T.D., No. T-113-84, February 29, 1984. |
| In light of the foregoing review on the purpose of s. 7 and the broad discretion afforded to the Minister in the exercise of his duties thereunder, it is my view that the Minister's power to authorize the issuance of licences is a continuing power until such time as a licence is actually issued. It follows that he retains the power to revoke the authorization at any time prior to the issuance of the licence. Once the authorization is revoked, the person authorized no longer has the authority to issue the licence. After the issuance, the ability to revoke is governed by s. 9 of the Act. |
| It can be seen from the foregoing that the Department of Fisheries does not have a fiduciary duty, trust or statutory duty to assure the Plaintiff's `T' licence gets the largest possible fish catch attributed so that the Plaintiff makes the most possible money. |
| [33] The Minister's duties under the Fisheries Act are to manage, conserve and develop the fishery on behalf of Canadians in the public interest. These duties do not include a trust or statutory or fiduciary duty to assure one particular fisher be allowed to fish the largest possible amount of fish to make the most personal economic gain. See Carpenter Fishing Corp. v. Canada, [1998] 2 F.C. 548 (C.A.) at paragraphs 34 to 37. |
| [34] The Minister's decision to exercise his absolute discretion to issue a fishing licence to a fisher under section 7 of the Fisheries Act is clearly an exercise of his administrative function. The Minister is not a trustee or fiduciary in the exercise of is administrative functions. In Penikett v. Regina (1987), 21 B.C.L.R. (2d) 1, the Yukon Territory Court of Appeal held that an action for breach of fiduciary duty could only succeed if the Plaintiffs "are owed a private law duty or public law duty which, different from the usual cases, give rise to a fiduciary duty." The Court of Appeal recognized the distinction between the creation of governmental obligations and fiduciary obligations quoting at p. 9 from Dickson J. in Guerin v. Canada, [1984] 2 S.C.R. 335 at 385: |
| It should be noted that fiduciary duties generally arise only with regard to obligations originating in a private law context. Public law duties, the performance of which requires the exercise of discretion, do not typically give rise to a fiduciary relationship. As the "political trust" cases indicate, the Crown is not normally viewed as a fiduciary in the exercise of its legislative or administrative function. |
| [35] The cases involving aboriginals where there has been a fiduciary duty imposed on the Crown are totally distinct from discretionary cases in the exercise of an administrative function as stated by Justice Dickson. |
| [36] In my view a fishing licence is merely a privilege to participate in a fishery for the duration of the licence. A grant of a fishing licence vests no interest or property in the grantee. There is no automatic right of renewal of a fishing licence. Cases such as Joys v. Minister of National Revenue (1995), 128 D.L.R. (4th) 385 (F.C.A.) at 394 and 399 and Re Bennett and Bennett (1988), 24 B.C.L.R. (2d) 346 (S.C.) at 350-351 confirm this view. |
| [37] If a fiduciary relationship or a breach of fiduciary duty was to arise between the Plaintiff and the Minister in connection with the issuance of T.8 licence, or that its current T.92 be treated as if it were licence T.8, all for the purposes of a particular IVQ as a condition of licencing, which the Defendant The Queen says there is not, then the following elements would have to be plead and found: (i) vulnerability, (ii) the exercise of a discretion; and (iii) the trustee gaining direct or indirect personal advantage due to the relationship of trust or confidence. The Plaintiff has not plead nor can it satisfy this test because the Minister does not gain any direct or indirect personal advantage by having the fish catch history of the T.8 licence with the "PACIFIC EAGLE" instead of with the "SEACREST". The fishery remains managed in either scenario and that is what the Minister's concern is. There is no personal advantage to the Minister whatsoever. As McEachern C.J.B.C. stated in C.A. v. Critchley et al. (1999), 113 B.C.A.C. 248 (C.A.) at paragraph 85: |
| Applying this approach, I conclude that it would be a principled approach to confine recovery based upon fiduciary duties to cases of the kind where, in addition to other usual requirements such as vulnerability and the exercise of a discretion, the defendant personally takes advantage of a relationship of trust or confidence for his or her direct or indirect personal advantage. This excludes from the reach of fiduciary duties many cases that can be resolved upon a tort or contract analysis, has the advantage of greater certainty, and also protects honest persons doing their best in difficult circumstances from the shame and stigma of disloyalty or dishonesty. In effect, this redirects fiduciary law back towards where it was before this experiment began but with much broader remedies, such as damages, when fiduciary duties are actually breached. |
| [38] I will now deal with whether or not the material facts pleaded support a cause of action in negligence. The availability of an administrative law remedy through judicial review, as sought by the Plaintiff in T-192-98, generally negates a duty of care. In Comeau's Sea Foods Ltd. v. Canada (Minister of Fisheries & Oceans), [1995] 2 F.C. 467 (C.A.), appeal dismissed by the S.C.C. on other grounds, [1997] 1 S.C.R. 12; Stone J.A. stated at 483 that "the availability of relief by way of judicial review is a factor to be considered in deciding whether to impose a duty of care." Stone J.A. went on to elaborate on his reasons for his view that in deciding the duty of care it is important to see whether there are adequate administrative law remedies available. At 486 of his decision, he quotes from C. Lewis, Judicial Remedies in Public Law (London:1992) at 379: |
| Decisions taken in the exercise of statutory power will be subject to judicial review, and sometimes a statutory right of appeal. Unlawful decisions can be nullified and the individual relieved of the consequences of such a decision. The existence of these remedies is regarded by the courts as an indicator that no additional remedy in negligence need be provided, particularly where the judicial review or appeal is adequate to rectify matters, and the only real damage suffered by the individual is the delay and possibly the expense involved in establishing that a decision is invalid. This seems in part an axiomatic decision on the part of the court, that there should be a division between public law remedies and private law remedies. Where an ultra vires decision can be set aside on appeal or review, there should not normally be any additional liability in damages, unless the individual can establish misfeasance. Simple negligence is insufficient. The fact that the decision may be set aside may also mean that the only damage suffered is the expense involved in challenging the decision. |
| [39] In Morgan v. Canada (1998), 117 B.C.A.C. 296 (C.A.) at 303, |
| Lambert J.A. found that the trial judge in that case had held that the Canadian Human Rights Act: |
| ... was not a statute for the protection of the public from economic damage and that the only remedy provided by law for failure on the part of the Commission to carry out, or promptly carry out, its duty under the Act is by judicial review proceedings in the nature of mandamus. |
| [40] Thus the prothonotary erred in concluding that a judicially reviewable Minister's decision amounted to, or created a cause of action. The absolutely discretionary decision by the Minister to authorize or issue a fishing licence, which fishing licence remains the property of the Crown, does not give rise to a right between the Plaintiff and the Minister. Consequently, a cause of action does not arise by virtue of the fact that such discretionary decision is reviewable through an application for judicial review. |
| [41] The next issue is whether the prothonotary erred in holding that the Minister's application of the quota policy in his discretionary decision to issue a fishing licence to the Plaintiff could be challenged in an action if the Plaintiff pleaded misfeasance or other grounds similar to those set out in Thompson v. Canada (MCI) (1996), 37 Imm.L.R. (2d) 9 (F.C.T.D.) or Williams v. Canada (MCI) (1997), 212 N.R. 63 (C.A.). The prothonotary held at paragraph 35 of his reasons: |
| The argument, that the minister was wrong and subject to censure by reason of the way in which he calculated the IVQ may not be at all an easy case upon which to succeed. However I am hesitant to strike it out as being, on its face, plainly and obviously incapable of succeeding. Moreover, a statement of claim ought not to be struck out, without an opportunity to amend, if there is a scintilla of a cause of action: Kiely v. The Queen (1987), 10 F.T.R. 10 (F.C.T.D.) at 11. For that reason I allowed the Plaintiff to file an amended Statement of Claim to more clearly plead grounds upon which the minister's discretionary decision might be challenged, referring in a short endorsement on the order to grounds which might include malfeasance or grounds similar to those set out in Thompson v. MCI (supra) or in Williams v. Canada (supra). |
| Both Thompson v. Canada, supra, and Williams v. Canada, supra, are applications for judicial review brought under grounds set out in s. 18.1(4) of the Federal Court Act in immigration cases. These cases do not involve grounds outside s. 18.1(4) and do not involve actions. |
| [42] In paragraphs 46, 47 and 48 of the Amended Statement of Claim, the Plaintiff alleged that the minister acted in bad faith by failing to consider the circumstances surrounding the licence transfer and improperly delegating responsibility to the DFO to investigate the matter itself. In order to make out the tort of misfeasance in public office, the Plaintiff must establish the following three elements: |
| (a) that the Minister was acting either: |
| (ii) with a knowledge that he had no power to do what he was doing; |
| (b) that the Minister's actions were deliberately calculated to injure the Plaintiffs; and |
| (c) that damage resulted therefrom. |
| See: Gerrard v. Manitoba (1992), 98 D.L.R. (4th) 167 (Man. C.A.); and |
| Dunlop v. Woollahra Municipal Council, [1981] 1 All E.R. (P.C.) 1202. |
| [43] Robertson J. A., in Comeau, supra, at 529-530 described misfeasance in a public office as follows: |
| In its earliest form, the tort of misfeasance in a public office was limited to cases where a public officer (a person exercising a statutory or prerogative power) abused a power actually possessed. Once it was shown that a decision was tainted with malice in the sense that there was an intent to inflict injury on the plaintiff then the invalid decision gave rise to a claim in damages. With time, the tort was extended to include cases in which decision-makers knew that they did not possess the power which they purported to exercise. Today, the administrative tort is established once it is shown that the invalid decision is tainted by either malice or knowledge: ... |
| A classic example of this administrative tort is Roncarelli v. Duplessis, [1959] S.C.R. 121, where liability depended on article 1053 of Quebec's Civil Code although it is generally assumed that liability would be the same under the common law; see Rand J., at pages 139-142. |
| [44] The Plaintiff has not pleaded material facts on which it relies to make a cause of action of misfeasance of public office, as required by Rule 174 of the Federal Court Rules, 1998. There are no facts pleaded that the Plaintiff was acting with malice or with the knowledge that he had no power to do what he was doing or that his actions were deliberately calculated to injure the Plaintiff. |
| [45] In my view the prothonotary erred in allowing the Plaintiff to amend its Statement of Claim to plead misfeasance in an effort to ensure that the Minister's decision is reviewable. The Minister's discretionary decision is only reviewable in an application for judicial review pursuant to the grounds set out in s. 18.1(4) of the Federal Court Act which encompass misfeasance in s. 18.1(4)(e). Although the prothonotary's decision is discretionary, I am of the view that he should have struck out the Statement of Claim on the basis that the Minister's discretionary decision can only be reviewed in an application for judicial review. Furthermore, leave to amend should not have been granted, as there is no amendment available that could create a cause of action in this case. |
| [46] The next issue is whether or not the prothonotary erred in refusing the application by the Attorney-General of Canada in Federal Court Action T-382-99 for a stay pending the determination of the identical action against the same parties in the Supreme Court of British Columbia. In view of the fact that I have found that the prothonotary should have struck out the Statement of Claim, it is not necessary to review this submission any further. |
| [47] I do not have to deal with the question of particulars since the Amended Statement of Claim is struck out. |
| [48] For the above reasons the appeal is allowed. The Plaintiff's Statement of Claim and the declaratory relief sought in the Statement of Claim are struck out. Costs to the Defendant, Her Majesty the Queen in Right of Canada, as represented by the Regional Director General of the Department of Fisheries and Oceans, for the Pacific Region. |