Date: 20031114
Docket: A-517-02
Citation: 2003 FCA 426
CORAM: ROTHSTEIN J.A.
SEXTON J.A.
BETWEEN:
KIRK CHARETTE
Appellant
and
THE COMMISSIONER OF COMPETITION Respondent
Heard at Toronto, Ontario on October 21, 2003.
Judgment delivered at Ottawa, Ontario, on November 14, 2003.
REASONS FOR JUDGMENT BY: SEXTON J.A.
CONCURRED IN BY: ROTHSTEIN J.A.
MALONE J.A.
Date: 20031114
Docket: A-517-02
Citation: 2003 FCA 426
CORAM: ROTHSTEIN J.A.
SEXTON J.A.
MALONE J.A.
BETWEEN:
KIRK CHARETTE
Appellant
and
THE COMMISSIONER OF COMPETITION
Respondent
REASONS FOR JUDGMENT
Introduction
[1] The key issue in this case is whether the Commissioner of Competition (the "Commissioner") is required to initiate a formal inquiry into the Appellant's complaints of anti-competitive activity under paragraph 10(1)(a) of the Competition Act, R.S.C. 1985, c. C-34 (the "Act") when the Commissioner has already thoroughly investigated these claims and found them not to warrant a formal inquiry under paragraph 10(1)(b) of the Act.
[2] Since May of 1999, the Appellant has submitted numerous and repeated complaints to the Commissioner and asked that an inquiry be held into these complaints under paragraph 10(1)(b) of the Act. The Commissioner investigated these complaints and decided that a formal inquiry under paragraph 10(1)(b) was unnecessary because there were no grounds to believe that the Act had been violated. After receiving this decision from the Commissioner and without presenting any new evidence, the Appellant attempted to have an inquiry initiated under paragraph 10(1)(a) into the same complaints that the Commissioner had already found to be unsubstantiated. The issue is whether, in these circumstances, the Commissioner was required to initiate an inquiry under paragraph 10(1)(a).
Statutory Background
[3] Under section 10 of the Act, there are three ways for the Commissioner to initiate an inquiry. First, the Commissioner may initiate an inquiry under paragraph 10(1)(a) when an application is made under section 9 by six Canadian residents of the age of majority who are of the opinion that a contravention of the Act has occurred. Second, an inquiry may be initiated under paragraph 10(1)(b) when the Commissioner has reason to believe that a contravention of the Act has occurred. Third, under paragraph 10(1)(c), the Minister of Industry may direct that an inquiry be held.
[4] The relevant provisions of the Act provide as follows:
| 9. (1) Any six persons resident in Canada who are not less than eighteen years of age and who are of the opinion that
(a) a person has contravened an order made pursuant to section 32, 33 or 34, or Part VII.1 or VIII,
(b) grounds exist for the making of an order under Part VII.1 or VIII, or
(c) an offence under Part VI or VII has been or is about to be committed, may apply to the Commissioner for an inquiry into the matter.
(2) An application made under subsection (1) shall be accompanied by a statement in the form of a solemn or statutory declaration showing
(a) the names and addresses of the applicants, and at their election the name and address of any one of their number, or of any attorney, solicitor or counsel, whom they may, for the purpose of receiving any communication to be made pursuant to this Act, have authorized to represent them;
(b) the nature of
(i) the alleged contravention,
(ii) the grounds alleged to exist for the making of an order, or
(iii) the alleged offence
and the names of the persons believed to be concerned therein and privy thereto; and
(c) a concise statement of the evidence supporting their opinion.
10. (1) The Commissioner shall
(a) on application made under section 9,
(b) whenever the Commissioner has reason to believe that
(i) a person has contravened an order made pursuant to section 32, 33 or 34, or Part VII.1 or Part VIII,
(ii) grounds exist for the making of an order under Part VII.1 or Part VIII, or
(iii) an offence under Part VI or VII has been or is about to be committed, or
(c) whenever directed by the Minister to inquire whether any of the circumstances described in subparagraphs (b)(i) to (iii) exists,
cause an inquiry to be made into all such matters as the Commissioner considers necessary to inquire into with the view of determining the facts.
(2) The Commissioner shall, on the written request of any person whose conduct is being inquired into under this Act or any person who applies for an inquiry under section 9, inform that person or cause that person to be informed as to the progress of the inquiry.
(3) All inquiries under this section shall be conducted in private. |
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9. (1) Six personnes résidant au Canada et âgées de dix-huit ans au moins peuvent demander au commissaire de procéder à une enquête dans les cas où elles sont d'avis, selon le cas :
a) qu'une personne a contrevenu à une ordonnance rendue en application des articles 32, 33 ou 34, ou des parties VII.1 ou VIII;
b) qu'il existe des motifs justifiant une ordonnance en vertu des parties VII.1 ou VIII;
c) qu'une infraction visée à la partie VI ou VII a été perpétrée ou est sur le point de l'être.
(2) La demande est accompagnée d'un exposé, sous forme de déclaration solennelle, indiquant :
a) les noms et adresses des requérants et, à leur choix, les nom et adresse de l'un d'entre eux ou d'un procureur, avocat ou conseil qu'ils peuvent, pour recevoir toutes communications prévues par la présente loi, avoir autorisé à les représenter;
b) la nature :
(i) soit de la prétendue contravention,
(ii) soit des motifs permettant de rendre une ordonnance,
(iii) soit de la prétendue infraction,
et les noms des personnes qu'on croit y être intéressées et complices;
c) un résumé des éléments de preuve à l'appui de leur opinion.
10. (1) Le commissaire fait étudier, dans l'un ou l'autre des cas suivants, toutes questions qui, d'après lui, nécessitent une enquête en vue de déterminer les faits :
a) sur demande faite en vertu de l'article 9;
b) chaque fois qu'il a des raisons de croire :
(i) soit qu'une personne a contrevenu à une ordonnance rendue en application des articles 32, 33 ou 34, ou des parties VII.1 ou VIII,
(ii) soit qu'il existe des motifs justifiant une ordonnance en vertu des parties VII.1 ou VIII,
(iii) soit qu'une infraction visée à la partie VI ou VII a été perpétrée ou est sur le point de l'être;
c) chaque fois que le ministre lui ordonne de déterminer au moyen d'une enquête si l'un des faits visés aux sous-alinéas b)(i) à (iii) existe.
(2) À la demande écrite d'une personne dont les activités font l'objet d'une enquête en application de la présente loi ou d'une personne qui a demandé une enquête conformément à l'article 9, le commissaire instruit ou fait instruire cette personne de l'état du déroulement de l'enquête.
(3) Les enquêtes visées au présent article sont conduites en privé. |
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Factual Background
A. Appellant's Complaints under Paragraph 10(1)(b)
[5] Since May 1999, the Appellant has made the following complaints to the Commissioner of Competition, requesting that a formal inquiry be held under paragraph 10(1)(b) of the Act.
Complaints under Subsections 75(1) and 79(1) of the Act
[6] In May of 1999, the Appellant, Kirk Charette, submitted his first complaint to the Competition Bureau. He complained that Delta Controls Systems Inc. ("Delta"), a manufacturer of commercial heating, ventilation and air conditioning systems, and Durell Control Systems Inc. ("Durell"), the exclusive distributor of Delta products in London, Ontario, refused to supply his business with Delta products, contrary to subsection 75(1) of the Act. Subsection 75(1) provides as follows:
| 75. (1) Where, on application by the Commissioner or a person granted leave under section 103.1, the Tribunal finds that
(a) a person is substantially affected in his business or is precluded from carrying on business due to his inability to obtain adequate supplies of a product anywhere in a market on usual trade terms,
(b) the person referred to in paragraph (a) is unable to obtain adequate supplies of the product because of insufficient competition among suppliers of the product in the market,
(c) the person referred to in paragraph (a) is willing and able to meet the usual trade terms of the supplier or suppliers of the product,
(d) the product is in ample supply, and
(e) the refusal to deal is having or is likely to have an adverse effect on competition in a market,
the Tribunal may order that one or more suppliers of the product in the market accept the person as a customer within a specified time on usual trade terms unless, within the specified time, in the case of an article, any customs duties on the article are removed, reduced or remitted and the effect of the removal, reduction or remission is to place the person on an equal footing with other persons who are able to obtain adequate supplies of the article in Canada. |
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75. (1) Lorsque, à la demande du commissaire ou d'une personne autorisée en vertu de l'article 103.1, le Tribunal conclut :
a) qu'une personne est sensiblement gênée dans son entreprise ou ne peut exploiter une entreprise du fait qu'elle est incapable de se procurer un produit de façon suffisante, où que ce soit sur un marché, aux conditions de commerce normales;
b) que la personne mentionnée à l'alinéa a) est incapable de se procurer le produit de façon suffisante en raison de l'insuffisance de la concurrence entre les fournisseurs de ce produit sur ce marché;
c) que la personne mentionnée à l'alinéa a) accepte et est en mesure de respecter les conditions de commerce normales imposées par le ou les fournisseurs de ce produit;
d) que le produit est disponible en quantité amplement suffisante;
e) que le refus de vendre a ou aura vraisemblablement pour effet de nuire à la concurrence dans un marché,
le Tribunal peut ordonner qu'un ou plusieurs fournisseurs de ce produit sur le marché en question acceptent cette personne comme client dans un délai déterminé aux conditions de commerce normales à moins que, au cours de ce délai, dans le cas d'un article, les droits de douane qui lui sont applicables ne soient supprimés, réduits ou remis de façon à mettre cette personne sur un pied d'égalité avec d'autres personnes qui sont capables de se procurer l'article en quantité suffisante au Canada. |
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[7] Mr. Charette had recently started a business named Basis (Building Automation Systems and Integration Services) in London, Ontario. Mr. Charette indicated to the Competition Bureau that the goal of his business was to supply and service energy management systems for large buildings and institutions.
[8] In June of 1999, Mr. Charette submitted a further complaint that Delta and Durell were abusing their dominant position in the energy market, contrary to subsection 79(1) of the Act. Subsection 79(1) states:
| 79. (1) Where, on application by the Commissioner, the Tribunal finds that
(a) one or more persons substantially or completely control, throughout Canada or any area thereof, a class or species of business,
(b) that person or those persons have engaged in or are engaging in a practice of anti-competitive acts, and
(c) the practice has had, is having or is likely to have the effect of preventing or lessening competition substantially in a market,
the Tribunal may make an order prohibiting all or any of those persons from engaging in that practice. |
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79. (1) Lorsque, à la suite d'une demande du commissaire, il conclut à l'existence de la situation suivante :
a) une ou plusieurs personnes contrôlent sensiblement ou complètement une catégorie ou espèce d'entreprises à la grandeur du Canada ou d'une de ses régions;
b) cette personne ou ces personnes se livrent ou se sont livrées à une pratique d'agissements anti-concurrentiels;
c) la pratique a, a eu ou aura vraisemblablement pour effet d'empêcher ou de diminuer sensiblement la concurrence dans un marché,
le Tribunal peut rendre une ordonnance interdisant à ces personnes ou à l'une ou l'autre d'entre elles de se livrer à une telle pratique. |
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[9] Competition Bureau staff spent a considerable amount of time investigating these complaints. During the investigation, staff members engaged in numerous e-mail, telephone, and letter communications with Mr. Charette in order to hear his evidence as well as to assist him in understanding the Act. Bureau staff also contacted both Delta and Durell to gather relevant information and made inquiries of third parties in the industry.
[10] On August 11, 1999, after considering all of the information that it had gathered, the Competition Bureau informed Mr. Charette in a detailed e-mail of its conclusion that there was no evidence that Delta or Durell had violated either section 75 or section 79 of the Act.
[11] With respect to the refusal to supply complaint under section 75, the Competition Bureau indicated that Mr. Charette had never requested to purchase products from Durell, so he could not complain that Durell had refused to supply him with products contrary to section 75. Furthermore, Delta was not obligated under the Act to supply its products directly to Mr. Charette. Delta was entitled to select Durell as the exclusive distributor of its products. The Bureau indicated that in order for it to continue to investigate this matter, Mr. Charette would have to present evidence that Durell had refused to supply him with Delta products.
[12] With respect to the abuse of dominant position complaint under section 79 of the Act, after extensive investigation, the Bureau concluded that the market for the manufacture and sale of commercial heating, ventilation and air conditioning systems was competitive and that Delta did not have a dominant share of the Canadian or Ontario market. As a result, there could be no violation of section 79.
[13] Notwithstanding this e-mail, Bureau staff continued to investigate and respond to Mr. Charette's inquiries and requests to examine further documents.
[14] On October 26, 1999, in another detailed e-mail, the Competition Bureau reiterated its conclusion to Mr. Charette that there was no evidence that section 75 or section 79 had been violated.
[15] With respect to section 75, the Bureau indicated that Mr. Charette had still provided no evidence that he had ever formally requested to purchase Delta products from Durell, and as a result, there could be no refusal to supply complaint. On the contrary, information collected from Durell indicated that it was willing to supply Delta products to Mr. Charette but that he had never requested to purchase any products. The Bureau indicated: "Until there is a formal refusal, the Bureau has no grounds to investigate further."
[16] Furthermore, the Bureau explained to Mr. Charette that in order for there to be an abuse of dominance contrary to section 79 of the Act there must be a substantial lessening of competition in a relevant market. The evidence collected indicated that neither Delta nor Durell were dominant firms and had relatively small shares in a competitive market.
Complaints under Subsections 45(1) and 50(1)(a) of the Act
[17] In June 1999, Mr. Charette made new complaints to the Criminal Branch of the Bureau that Delta and Durell were violating criminal provisions of the Act. In particular, Mr. Charette complained to the Bureau that Delta and Durell were engaged in a conspiracy to lessen competition contrary to subsection 45(1) of the Act. Subsection 45(1) states:
| 45. (1) Every one who conspires, combines, agrees or arranges with another person
(a) to limit unduly the facilities for transporting, producing, manufacturing, supplying, storing or dealing in any product,
(b) to prevent, limit or lessen, unduly, the manufacture or production of a product or to enhance unreasonably the price thereof,
(c) to prevent or lessen, unduly, competition in the production, manufacture, purchase, barter, sale, storage, rental, transportation or supply of a product, or in the price of insurance on persons or property, or
(d) to otherwise restrain or injure competition unduly,
is guilty of an indictable offence and liable to imprisonment for a term not exceeding five years or to a fine not exceeding ten million dollars or to both. |
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45. (1) Commet un acte criminel et encourt un emprisonnement maximal de cinq ans et une amende maximale de dix millions de dollars, ou l'une de ces peines, quiconque complote, se coalise ou conclut un accord ou arrangement avec une autre personne :
a) soit pour limiter, indûment, les facilités de transport, de production, de fabrication, de fourniture, d'emmagasinage ou de négoce d'un produit quelconque;
b) soit pour empêcher, limiter ou réduire, indûment, la fabrication ou production d'un produit ou pour en élever déraisonnablement le prix;
c) soit pour empêcher ou réduire, indûment, la concurrence dans la production, la fabrication, l'achat, le troc, la vente, l'entreposage, la location, le transport ou la fourniture d'un produit, ou dans le prix d'assurances sur les personnes ou les biens; d) soit, de toute autre façon, pour restreindre, indûment, la concurrence ou lui causer un préjudice indu. |
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[18] In October 1999, Mr. Charette complained that Delta and Durell were engaged in price discrimination contrary to paragraph 50(1)(a) of the Act because he was not able to obtain Delta products on the same terms as Durell. Mr. Charette indicated that Durell and Delta had entered into a distributorship agreement which entitled Durell to purchase Delta products at below retail prices. Paragraph 50(1)(a) of the Act states:
| 50. (1) Every one engaged in a business who
(a) is a party or privy to, or assists in, any sale that discriminates to his knowledge, directly or indirectly, against competitors of a purchaser of articles from him in that any discount, rebate, allowance, price concession or other advantage is granted to the purchaser over and above any discount, rebate, allowance, price concession or other advantage that, at the time the articles are sold to the purchaser, is available to the competitors in respect of a sale of articles of like quality and quantity...
is guilty of an indictable offence and liable to imprisonment for a term not exceeding two years. |
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50. (1) Commet un acte criminel et encourt un emprisonnement maximal de deux ans toute personne qui, exploitant une entreprise, selon le cas :
a) est partie intéressée ou contribue, ou aide, à une vente qui est, à sa connaissance, directement ou indirectement, discriminatoire à l'endroit de concurrents d'un acheteur d'articles de cette personne en ce qu'un escompte, un rabais, une remise, une concession de prix ou un autre avantage est accordé à l'acheteur au-delà et en sus de tout escompte, rabais, remise, concession de prix ou autre avantage accessible à ces concurrents au moment où les articles sont vendus à cet acheteur, à l'égard d'une vente d'articles de qualité et de quantité similaires;
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[19] By letter dated November 2, 1999, the Deputy Commissioner of Competition explained that paragraph 50(1)(a) makes it a criminal offence for a seller to knowingly discriminate against competitors if they purchase articles of like quality and quantity. The Deputy Commissioner reiterated that the Act does not mandate that Delta supply its products directly to customers; rather, Delta is entitled to enter into a distributorship agreement with Durell which entitles Durell to purchase Delta products at below retail prices in exchange for its own obligations respecting such things as minimum volume of purchases and service quality. Furthermore, since Durell had significantly higher volumes of purchases than Mr. Charette, it was perfectly acceptable for Durell to purchase Delta products on more advantageous terms.
[20] The Deputy Commissioner of Competition also addressed Mr. Charette's complaint under subsection 45(1) of the Act. The Deputy Commissioner found that there was no evidence that subsection 45(1) had been violated. She indicated that exclusive distributorship arrangements are a normal method of doing business in Canada and are not, in themselves, anti-competitive.
[21] Also in this letter, the Deputy Commissioner of Competition indicated that after carefully reviewing the information that Mr. Charette provided by e-mail and phone as well as information from other market participants, the Bureau concluded that there were no reason to believe that any of the civil or criminal provisions of the Act had been contravened and, as a result, there was no reason to initiate a formal inquiry under paragraph 10(1)(b). However, the Deputy Commissioner once again indicated that the Bureau would be willing to re-examine Mr. Charette's refusal to supply complaint if he provided evidence that Durell had actually refused to supply him with Delta products and that he could not obtain supply from other Delta distributors. The Deputy Commissioner indicated that Durell was willing to supply the Appellant on usual trade terms and had even sent Mr. Charette a credit application.
[22] After receiving the November 12, 1999 letter from the Deputy Commissioner indicating that there was no basis to proceed with a formal inquiry with respect to any of the civil or criminal provisions of the Act, the Appellant continued to make the same complaints to the Competition Bureau without bringing forward any new evidence. Mr. Charette continued to engage in numerous e-mail, telephone and letter communications with staff of the Bureau.
Complaint under Subsection 52(1) of the Act
[23] By letter dated December 9, 1999, Mr. Charette made a new complaint to the Fair Business Practices Branch of the Bureau that Delta had violated subsection 52(1) of the Act by making false or misleading misrepresentations to a third party that his business was not an acceptable service provider of Delta products. As evidence of this, Mr. Charette pointed to a letter dated November 8, 1999 written by Delta and sent to the City of London. The letter merely stated that Basis was not an authorized Delta distributor and had no connection or affiliation with Delta or Durell. Mr. Charette does not claim to be an authorized distributor of Delta. Subsection 52(1) of the Act states:
| 52. (1) No person shall, for the purpose of promoting, directly or indirectly, the supply or use of a product or for the purpose of promoting, directly or indirectly, any business interest, by any means whatever, knowingly or recklessly make a representation to the public that is false or misleading in a material respect. |
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52. (1) Nul ne peut, de quelque manière que ce soit, aux fins de promouvoir directement ou indirectement soit la fourniture ou l'utilisation d'un produit, soit des intérêts commerciaux quelconques, donner au public, sciemment ou sans se soucier des conséquences, des indications fausses ou trompeuses sur un point important.
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[24] By e-mail dated January 26, 2000, an investigator at the Civil Branch of the Bureau indicated that he had discussed Mr. Charette's section 52 complaint with senior members of the Bureau and that they unanimously concluded that the letter written by Delta did not raise any issues under the civil provisions of the Act.
[25] After this, Mr. Charette continued to complain in numerous e-mails and letters that Delta and Durell were violating the same civil and criminal provisions of the Act as had already been addressed. Bureau officers continued to consider Mr. Charette's complaints and requested further information from him. For example, in various e-mails, Bureau staff asked Mr. Charette whether he had requested to purchase products from Durell and in what amounts. However, Mr. Charette did not respond to these requests.
[26] By letter dated March 9, 2000, the Assistant Deputy Commissioner of Competition once again explained to Mr. Charette that neither Delta nor Durell were violating paragraph 50(1)(a) of the Act. The letter explained that companies are free to choose their own distribution methods and to select their own distributors. As a result, the Appellant does not have a right to purchase its products directly from Delta and instead must purchase products from Durell. The letter indicated that there were no grounds to proceed with a formal inquiry into whether section 50 had been violated.
[27] On March 20, 2000, Mr. Charette once again submitted a letter to the Bureau regarding the same price discrimination complaint. By letter dated March 31, 2000, on the request of the Commissioner, the Deputy Commissioner once again responded to this complaint. The Deputy Commissioner indicated that he had carefully reviewed the information submitted by the Appellant as well as the analysis of the Bureau Staff and concluded that section 50(1)(a) had no application to his complaint.
[28] In a series of e-mails and faxes from March 29, 2000 to April 17, 2000, the Appellant made new allegations which are not relevant for the purposes of this appeal and reiterated his earlier complaints of price discrimination.
[29] In a letter dated April 19, 2000, the Assistant Deputy Commissioner of Competition stated that the Bureau had already determined that there was no basis for pursuing a formal inquiry into price discrimination and that it had closed the case.
[30] Even though the Bureau indicated that the case was closed, the Appellant continued to send numerous e-mails, letters, and faxes to the Bureau regarding the same price discrimination complaint.
Complaints under Subsection 64(1) of the Act
[31] In a letter to the Commissioner of Competition dated August 11, 2000, Mr. Charette made a new complaint that the Assistant Deputy Commissioner had obstructed justice by attempting to prevent an inquiry from being held into his complaints, contrary to subsection 64(1) of the Act. In this letter, Mr. Charette made the serious allegation that an inquiry "did not occur by cause of an explicit and deliberate effort." Subsection 64(1) of the Act states:
| 64. (1) No person shall in any manner impede or prevent or attempt to impede or prevent any inquiry or examination under this Act. |
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64. (1) Nul ne peut d'aucune façon entraver ou empêcher ou tenter d'entraver ou d'empêcher une enquête ou un interrogatoire sous le régime de la présente loi. |
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[32] By letter dated August 28, 2000, the Commissioner indicated to Mr. Charette that he had investigated his complaint about obstruction of justice and that the time and effort spent by staff examining his complaints and determining whether there was reason to commence an inquiry was exemplary. The Commissioner indicated that staff had provided Mr. Charette with numerous detailed written responses, e-mails and telephone calls and that there was no evidence that any member of the Bureau had attempted to prevent an inquiry into Mr. Charette's complaints.
[33] The Commissioner of Competition also reiterated the Bureau's earlier position that there was no evidence that Delta or Durell had violated either the civil or criminal provisions of the Act, and that there was no reason to commence an inquiry under paragraph 10(1)(b) of the Act. The Commissioner stated that unless Mr. Charette brought forward new evidence, the investigation into his complaints was closed.
[34] On August 31, 2000, Mr. Charette wrote a letter to his Member of Parliament outlining his obstruction of justice complaints. This letter was copied to the Minister of Industry.
[35] By letter dated September 12, 2000, Mr. Charette requested that the Commissioner make further inquiries into his section 64 complaints. Subsequent to this, Mr. Charette made additional obstruction of justice complaints against virtually every member of the Competition Bureau who had investigated his allegations, including the Commissioner of Competition, an Acting Commissioner of Competition, the Assistant Deputy Commissioner of Competition, and an Investigator at the Criminal Matters Branch of the Competition Bureau. In making many of his obstruction of justice complaints, Mr. Charette alleged that Bureau staff had made legal errors in interpreting the Act.
[36] By letter dated September 26, 2000, the Commissioner indicated that he had referred Mr. Charette's complaints to Francois Coté, Senior Counsel at the Department of Justice.
[37] Mr. Coté investigated these complaints, including visiting Mr. Charette in London, Ontario. In February, Mr. Coté advised Mr. Charette of his finding that there had been no obstruction of justice with respect to any of his complaints.
[38] After Mr. Coté advised Mr. Charette of his findings, on February 16, 2001, Mr. Charette made a formal complaint that Mr. Coté had himself obstructed justice in the course of his investigations.
[39] The Assistant Deputy Minister, Business Law and Counsel to the Department of Industry investigated these further charges. In March 2001, he wrote to Mr. Charette indicating that after investigating the matter, he was satisfied that every effort had been made to investigate his complaints and that there was no evidence of obstruction of justice on the part of any government officials. He further indicated that the Competition Bureau had made a final decision not to proceed with an inquiry into the obstruction complaints and treated the matter as closed.
[40] In total, the Commissioner devoted in excess of 500 hours over a 22 month period to investigating Mr. Charette's complaints. During this investigation process, Mr. Charette sent the various staff members of the Bureau at least 177 e-mails, faxes and letters. In turn, the Bureau provided an e-mail, fax or letter response to Mr. Charette on 79 occasions.
B. Complaints under Section 9 and Paragraph 10(1)(a)
[41] In a letter dated February 14, 2001 to the Bureau, Mr. Charette indicated that since his complaints were not being addressed under paragraph 10(1)(b), he presumed that it would be necessary for him to bring an application under section 9 of the Act. After being advised in March for the final time that there were no grounds to hold an inquiry into any of his complaints under paragraph 10(1)(b) of the Act, by letter dated March 26, 2001 to the Commissioner, Mr. Charette along with the requisite five other Canadian citizens, Ginette Charette, Rheal Charette, Claudette Charette, Ghislain Morin and Vianne Morrin, applied for an inquiry under section 9 and paragraph 10(1)(a) of the Act. In an addendum to the section 9 application, the five other applicants elected to have Mr. Charette receive all communications from the Bureau on their behalf.
[42] The section 9 application contained the exact same complaints against Delta and Durell and members of the Competition Bureau that were previously found to be unsubstantiated. The application did not present any new evidence. In particular, the section 9 application included the following three complaints. First, the fact that Durell is able to purchase Delta products at lower prices than the Appellant and other competitors constitutes price discrimination contrary to paragraph 50(1)(a) of the Act. Second, Delta made misleading representations that the Appellant's business was not an acceptable service provider contrary to section 52 of the Act. Third, an investigator at the Bureau had attempted to impede an inquiry contrary to section 64 of the Act.
[43] The Commissioner decided not to commence an inquiry into these complaints under paragraph 10(1)(a) since he had already investigated these complaints and determined that they were unsubstantiated. However, the Commissioner did not inform Mr. Charette of his decision not to proceed under paragraph 10(1)(a) because of the earlier correspondence to Mr. Charette that the Commissioner would no longer investigate the same complaints in the absence of new evidence. On April 17, 2001, Mr. Charette submitted a written request under subsection 10(2) for information on the progress of the paragraph 10(1)(a) inquiry, but the Commissioner did not respond.
[44] On September 26, 2001, Mr. Charette filed a judicial review application at the Federal Court, taking the position that the Commissioner was obliged to commence an inquiry under paragraph 10(1)(a) and was required under subsection 10(2) to respond to Mr. Charette's written requests for information on the progress of the inquiry. Mr. Charette asked for an order of mandamus to require the Commissioner to fulfill these legal duties. It is significant that it was Mr. Charette alone who commenced the application for mandamus. The other five people who signed the section 9 complaint were not made parties to the judicial review application, thus indicating that Mr. Charette is clearly the guiding force behind the complaint.
[45] Mr. Charette also filed a Statement of Claim against the Commissioner and Delta, raising the same matters already investigated by the Commissioner. This Statement of Claim was struck out and is the subject matter of a separate appeal.
[46] After filing his judicial review application, Mr. Charette continued to write to the Competition Bureau, making further arguments as to why the Bureau should investigate his complaints. He did not raise any additional evidence during this time. In addition, Mr. Charette alleged that the Commissioner was engaged in "criminal deceit" and "falsehoods" and that counsel was contributing to a criminal offence by representing the Commissioner in the judicial review application.
Decision Below
[47] First, the Motions Judge found that the Commissioner had already fully performed the legal duty that he owed to Mr. Charette under the Act. The Commissioner investigated Mr. Charette's complaints and determined that an inquiry was not warranted under paragraph 10(1)(b) of the Act. As a result, the Commissioner did not have a duty to initiate a formal inquiry under paragraph 10(1)(a). Section 10 should be interpreted in a way that avoids the possibility of identical complaints being submitted one after another without new facts being raised. Furthermore, the Commissioner had already performed the legal duty that he owed to Mr. Charette under subsection 10(2) of the Act because he fully advised Mr. Charette of the results of his investigation and conclusion that an inquiry was not warranted under paragraph 10(1)(b).
[48] Second, in the alternative that the Commissioner did have a duty to initiate an inquiry under paragraph 10(1)(a), the Motions Judge concluded that she would exercise her discretion not to grant mandamus because Mr. Charette's actions amounted to an abuse of process. Mr. Charette should be prevented from monopolizing Bureau resources to the detriment of the public interest in the effective operation of the Act.
Issues
1. Did the Motions Judge err in concluding that the Commissioner was not required to initiate a formal inquiry under paragraph 10(1)(a) of the Act into complaints which had already been thoroughly investigated and found not to warrant a formal inquiry under paragraph 10(1)(b) of the Act?
2. Did the Motions Judge err in finding that the Commissioner had fulfilled the subsection 10(2) requirement to inform Mr. Charette as to the progress of the inquiry?
3. If the Commissioner was required to initiate an inquiry under paragraph 10(1)(a) of the Act or did not fulfill his duty under subsection 10(2), did the Motions Judge err in exercising her discretion to deny mandamus?
Analysis
1. The Commissioner of Competition was not required to initiate a formal inquiry under paragraph 10(1)(a) of the Act
[49] In the particular circumstances of this case, it is my opinion that the Commissioner of Competition did not have to initiate a formal inquiry under paragraph 10(1)(a) of the Act. I agree with the factual findings of the motions Judge. The complaints that Mr. Charette made under section 9 of the Act for which he is requesting an inquiry under paragraph 10(1)(a) are precisely the same complaints that the Commissioner has already investigated for numerous hours and found to be completely unsubstantiated. Importantly, Mr. Charette raised no new evidence to substantiate these complaints but rather simply referred the Commissioner to evidence that he had already considered when deciding that an inquiry was not warranted under paragraph 10(1)(b) of the Act.
[50] A purposive analysis of section 10 of the Act reveals that the Commissioner is not required to initiate a formal inquiry under paragraph 10(1)(a) into complaints which he has already thoroughly investigated and found not to warrant a formal inquiry under paragraph 10(1)(b). The purpose behind section 10 of the Act is for the Commissioner to gather information to determine whether there are grounds to either bring a civil case before the Competition Tribunal or present evidence to the Attorney General of Canada that a criminal case should be prosecuted. See Canada (Director of Investigation & Research) v. Warner Music Group Inc. (1997), 138 F.T.R. 140. In The Canadian Competition Law Handbook, Flavell and Kent state at pages 29 and 40:
The chief of competition law enforcement in Canada is the Director of Investigation and Research [now called the Commissioner], appointed by the Governor-in-Council (the Federal Cabinet) under s. 7 of the Act. The Director [Commissioner] and staff of the Competition Bureau investigate situations suspected of being in violation of the criminal prohibitions of the Act or suspected of forming the grounds for a civil order by the Competition Tribunal under its jurisdiction to hear and judge reviewable matters.
...
If competition law concerns are identified [during an inquiry], a number of enforcement options are available to the Director. At the most informal and least intrusive end of the spectrum, the Director may resolve a case, without involving the Attorney General or making a formal application to the Tribunal, by accepting a written undertaking to remedy a situation...
Where the Director feels that the evidence gathered indicates a criminal offence, the Director may remit the records and evidence which he has obtained to the Attorney General of Canada for consideration and, at the discretion of the latter, for the institution of proceedings...
Where, at any time during or after an inquiry, the Director forms the view that the evidence discloses behaviour, conduct or market phenomena properly reviewable by the Tribunal in its civil jurisdiction, the Director may formally make an application to the Tribunal for one or more of a number of remedies, ranging from consent orders to full divestiture orders.
In the circumstances of this case, the purpose of section 10 has already been met because the Commissioner has already determined, after gathering the relevant information and thoroughly investigating the matter, that there is no reason to believe that the Act has been contravened. The purpose of the Act will not be furthered by finding that the Commissioner must initiate a formal inquiry when it has already determined that this is unnecessary.
[51] The Commissioner has already performed all of the work that would have been required of him under paragraph 10(1)(a) if Mr. Charette had initially brought his complaints by way of a section 9 application. The Commissioner, through Competition Bureau staff, has gathered all of the relevant information from Mr. Charette, Delta, Durell, and third parties in the industry. After considering this information, the Commissioner concluded that there were absolutely no grounds to indicate that either Delta or Durell had violated the Act. Thus, the Commissioner has actually performed the investigation which would have been required had Mr.Charette first applied under section 9.
[52] What is required by an "inquiry" under section 10 of the Act is not defined. In the Concise Oxford English Dictionary, "inquiry"is defined as "an act of asking for information." In this case, the Commissioner has already gathered all of the relevant information and satisfied himself that there are no grounds to believe that the Act has been violated. As well, as previously indicated, the purpose behind section 10 of the Act has already been met in this case, and there is no reason to require that the Commissioner initiate a formal inquiry under paragraph 10(1)(a).
[53] Interpreting section 10 so as not to require that the Commissioner hold a formal inquiry in the circumstances of this case is supported by subsection 22(1) of the Act, which indicates that the Commissioner is given a large discretion to discontinue an inquiry at any time if he is of the opinion that further inquiry is not necessary. Subsection 22(1) provides:
| 22.(1) At any stage of an inquiry under section 10, if the Commissioner is of the opinion that the matter being inquired into does not justify further inquiry, the Commissioner may discontinue the inquiry.
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22. (1) Le commissaire peut, à toute étape d'une enquête visée à l'article 10, discontinuer l'enquête en question lorsqu'il estime que l'affaire sous étude ne justifie pas la poursuite de l'enquête. |
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[54] Finally, interpreting paragraph 10(1)(a) as mandating that an inquiry be held in the circumstances of this case would lead to absurd results. Such an interpretation would allow people to abuse the process under section 10 of the Act by bringing the exact same complaints without any new evidence under both paragraphs 10(1)(a) and 10(1)(b) of the Act when there has already been a thorough investigation, requiring the Commissioner to devote Bureau resources to repeated investigations of these claims. According to Gonthier J., speaking for a majority of the Court in Ontario v. Canadian Pacific Ltd., [1995] 2 S.C.R. 1028, an interpretation leading to absurdity is to be avoided. Gonthier J. stated at p. 1082.
Second, interpreting the concept of "use" in s. 13(1)(a) in a restrictive manner is supported not only by its place in the legislative scheme, but also by the principle that a statute should be interpreted to avoid absurd results. Pierre-André C_té, The Interpretation of Legislation in Canada (2nd ed. 1991), observes at pp. 383-84 that consideration of the consequences of competing interpretations will assist the courts in determining the actual meaning intended by the legislature. Since it may be presumed that the legislature does not intend unjust or inequitable results to flow from its enactments, judicial interpretations should be adopted which avoid such results. One method of avoiding absurdity is through the strict interpretation of general words (at p. 330). Driedger on the Construction of Statutes (3rd ed. 1994) states the relationship between the absurdity principle and strict interpretation as follows, at p. 94: "Absurdity is often relied on to justify giving a restricted application to a provision". Where a provision is open to two or more interpretations, the absurdity principle may be employed to reject interpretations which lead to negative consequences, as such consequences are presumed to have been unintended by the legislature.
[55] When Mr. Charette brought his complaints to the Commissioner beginning in May 1999, he decided to proceed under paragraph 10(1)(b) of the Act. In the absence of new evidence, he should not be allowed to now proceed with the same complaints under paragraph 10(1)(a). Mr. Charette has already had his complaints extensively investigated, and he has already been advised of the results of these investigations.
[56] I would like to stress that I am not saying that once a complainant persuades the Commissioner to initiate an investigation under paragraph 10(1)(b), he or she is automatically precluded from proceeding with the same complaints under paragraph 10(1)(a). The investigation actually undertaken by the Commissioner must be examined. It is only where the Commissioner has conducted a thorough and complete investigation of the complaints such that he has done what would have been required of him if he had held a formal inquiry under paragraph 10(1)(a) that he does not have a duty to initiate a formal inquiry and conduct yet another investigation under paragraph 10(1)(a).
2. The Commissioner has fulfilled his duty under subsection 10(2) of the Act
[57] Even though the Commissioner was not obligated to commence a formal inquiry under paragraph10(1)(a), the Commissioner nevertheless had a duty under subsection 10(2) to respond to Mr. Charette's written request for information about the progress of the inquiry. Subsection 10(2) states:
| 10.(2) The Commissioner shall, on the written request of any person whose conduct is being inquired into under this Act or any person who applies for an inquiry under section 9, inform that person or cause that person to be informed as to the progress of the inquiry.
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In the circumstances of this case, subsection 10(2) means that the section 9 applicant must be informed of the fact that the Commissioner believes that there are no grounds to initiate a formal inquiry because of prior investigations.
[58] In my opinion, on the facts of this case, the Commissioner has fulfilled this duty. First, prior to Mr. Charette's section 9 application, the Commissioner had already provided Mr. Charette with many detailed explanations as to why in the absence of new evidence his complaints were unsubstantiated. The Commissioner clearly indicated that his investigation into Mr. Charette's complaints was closed and that he would not be conducting any further investigations unless Mr. Charette brought forward new evidence. As previously stated, the complaints made in the section 9 application are exactly the same as Mr. Charette's earlier complaints. Since Mr. Charette presented no new evidence in his section 9 application, the fact that the Commissioner did not respond to Mr. Charette's application was consistent with his earlier position that the investigation was closed in the absence of new evidence.
[59] Finally, since in the particular circumstances of this case, subsection 10(2) only required the Commissioner to inform Mr. Charette that, consistent with his earlier position, he would not be initiating a formal inquiry, the Commissioner made this position clear in his response to Mr. Charette's judicial review application. Eugene Besruky, one of the members of the Bureau staff who investigated Mr. Charette's complaints stated the following in paragraphs 12 to 13 of an affidavit in response to the judicial review application:
... Mr. Charette submitted the application for an inquiry by the Commissioner under section 9 of the Competition Act, which is the subject of his complaint in this Court Application. All three complaints raised in Mr. Charette's Notice of Application are among those that are described above, which were fully investigated by the Bureau, and reported upon to Mr. Charette (see Exhibits "J", "U", "V", "W", "DD", "HH" and "JJ" hereto.)
In such circumstances, the Bureau has not commenced yet another investigation into the same complaints which have already been examined and reported upon and which are simply repackaged pursuant to section 9 of the Competition Act. Indeed, the Application herein does not even purport to set out new evidence, but rather notes that the principal evidence has been with the Bureau since early on in the investigation of his complaints. [emphasis added]
[60] Clearly, Mr. Charette has been made aware that the Commissioner would not be initiating a formal inquiry under paragraph 10(1)(a). As a result, the obligations owed by the Commissioner under subsection 10(2) have been fulfilled.
3. If the Commissioner did have a legal duty to initiate an inquiry under paragraph 10(1)(a) or did not fulfill his duty under subsection 10(2), Tremblay-Lamer J. did not err in exercising her discretion to deny mandamus.
[61] The fact that the Court's power to issue a mandamus order is discretionary is evident both from the case law and from subsection 18.1(3) of the Federal Court Act, R.S.C. 1985, c. F-7. In Re Central Canada Potash Co. Ltd. et al. and Minister of Mineral Resources for Saskatchewan (1973), 32 D.L.R. (3d) 107 (Sask. C.A.) at 115; appeal to S.C.C. dismissed (1973), 38 D.L.R. (3d) 317, the Court stated:
... there can be no doubt that mandamus is above all a discretionary remedy. While it would be difficult to state, with certainty, all of the grounds upon which a Judge would be justified in refusing the writ in the exercise of discretionary right, such grounds are indeed broad and extensive.
Furthermore, subsection 18.1(3)of the Federal Court Act states:
| 18.1(3) On an application for judicial review, the Trial Division may
(a) order a federal board, commission or other tribunal to do any act or thing it has unlawfully failed or refused to do or has unreasonably delayed in doing; or... [emphasis added]
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3) Sur présentation d'une demande de contrôle judiciaire, la Section de première instance peut :
a) ordonner à l'office fédéral en cause d'accomplir tout acte qu'il a illégalement omis ou refusé d'accomplir ou dont il a retardé l'exécution de manière déraisonnable; [emphasis added] |
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[62] In Apotex Inc. v. Canada, [1994] 1 F.C. 742 ("Apotex"), this Court set out the requirements that must be met before an order of mandamus is granted. In this case, this Court stated at para. 45 that one of the pre-requisites to an order of mandamus is that "on a 'balance of convenience' an order in the nature of mandamus should issue." Tremblay-Lamer J. did not err in finding that in the particular circumstances of this case, the balance of convenience is in favour of not granting the order of mandamus.
[63] First, there is very little, if any, practical value to granting an order of mandamus in this case. In Apotex, supra at para. 45, this Court indicated that one of the pre-requisites to granting an order of mandamus is that it must have some practical value. As previously outlined, the Commissioner has already thoroughly investigated all of the complaints raised by Mr. Charette in his section 9 application and determined that they are groundless. Nothing would be gained by requiring the Commissioner to initiate a formal inquiry in these circumstances. Even if this court were to order the Commissioner to initiate an inquiry under paragraph 10(1)(a), the Commissioner has the discretion to discontinue this inquiry at any time if he is of the opinion that the matter does not justify further inquiry, and after extensive investigation, the Commissioner is clearly of this opinion. The Supreme Court of Canada decision in Maple Lodge Farms Ltd. v. Canada, [1982] 2 S.C.R. 2 suggests that in making this discretionary decision, the Commissioner simply must not act in bad faith, rely on considerations irrelevant to the Act's purpose or violate the principles of procedural fairness. The Commissioner has not done any of these things in this case.
[64] Mr. Charette argued that if the Commissioner was not ordered to initiate a formal inquiry under paragraph 10(1)(a) of the Act, then he would no longer have a right to appeal the outcome of the inquiry to the Minister of Industry under subsection 22(4) of the Act. Subsection 22(4) states:
| 22. (4) The Minister may, on the written request of Applicants under section 9 or on the Minister's own motion, review any decision of the Commissioner to discontinue an inquiry under section 10, and may, if in the Minister's opinion the circumstances warrant, instruct the Commissioner to make further inquiry. |
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22.(4) Le ministre peut, de sa propre initiative ou à la demande écrite des requérants visés à l'article 9, réviser la décision du commissaire de discontinuer l'enquête prévue à l'article 10 et, s'il estime que les circonstances le justifient, il peut donner au commissaire l'ordre de poursuivre l'enquête. |
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[65] Contrary to Mr. Charette's submissions, subsection 22(4) of the Act does not grant section 9 applicants a right to appeal the Commissioner's decision to the Minister; rather, subsection 22(4) provides that the Minister has the discretion to review the Commissioner's decision and instruct the Commissioner to make further inquiry. Importantly, under paragraph 10(1)(c) of the Act, the Minister has the discretion to ask the Commissioner to inquire into a matter even if the Commissioner has not discontinued an inquiry. As a result, even if this Court does not order the Commissioner to initiate an inquiry under paragraph 10(1)(a), the Minister still has the discretion under paragraph 10(1)(c) to direct the Commissioner to inquire into the matter.
[66] There would be no practical value to requiring the Commissioner to inform Mr. Charette under subsection 10(2) of his opinion that no further investigation into his complaints is warranted. Mr. Charette is already fully aware that this is the Commissioner's position.
[67] Second, while an order of mandamus in this case is of virtually no practical value to Mr. Charette, refusing to grant such an order in the particular circumstances of this case would be of great practical value to the public interest. The Commissioner does not have unlimited resources, and if this Court were to order the Commissioner to hold a formal inquiry into matters which it had already thoroughly investigated, the Commissioner would have less resources to consider new complaints.
[68] In addition, Mr. Charette's conduct in first requesting and then, by his actions, encouraging the Commissioner to thoroughly investigate his complaints under paragraph 10(1)(b) and then bringing the exact same complaints under paragraph 10(1)(a) constitutes an abuse of process of the Act, which also suggests that mandamus should not be granted in this case.
[69] Finally, although the balance of convenience is already in favour of not granting an order of mandamus in this case, I also take note of the fact that Mr. Charette has made very serious obstruction of justice complaints against staff members of the Competition Bureau without any grounds for making such allegations. This conduct is yet another factor to be considered in deciding whether or not to grant the discretionary remedy of mandamus in this case.
Conclusion
[70] In the particular circumstances of this case, section 10 of the Act should not be interpreted to require the Commissioner to initiate a formal inquiry into Mr. Charette's complaints under paragraph 10(1)(a) in the absence of new evidence when he has already thoroughly investigated these complaints. As well, the Commissioner has already fulfilled his duties to Mr. Charette under subsection 10(2) of the Act. In any event, the balance of convenience suggests that an order of mandamus should not be granted in this case.
[71] The Appeal should be dismissed with costs.
"J. EDGAR SEXTON"
J.A.
"I agree
Marshall Rothstein J.A."
"I agree
B. Malone J.A."