Federal Court of Appeal Decisions

 

 

Date: 20061117

Dockets: A-505-05

A-506-05

 

Citation: 2006 FCA 378

CORAM:       LINDEN J.A.

                        MALONE J.A.

                        PELLETIER J.A.

 

BETWEEN:

Docket: A-505-05

H.J. HEINZ COMPANY OF CANADA LTD.

Appellant

and

 

ATTORNEY GENERAL OF CANADA

                                                                                                                                        Respondent

 

 

Docket: A-506-05

 

H.J. HEINZ COMPANY OF CANADA LTD. and

JAMES FRIEL

Appellants

and

 

ATTORNEY GENERAL OF CANADA

                                                                                                                                        Respondent

 

Heard at Ottawa, Ontario, on October 11, 2006.

Judgment delivered at Ottawa, Ontario, on November 17, 2006.

REASONS FOR JUDGMENT BY:                                                                          PELLETIER J.A.

CONCURRED IN BY:                                                                                                  LINDEN J.A.

MALONE J.A.

 

 

 

 

Date: 20061117

Dockets: A-505-05

A-506-05

 

Citation: 2006 FCA 378

 

CORAM:       LINDEN J.A.

                        MALONE J.A.

                        PELLETIER J.A.

 

BETWEEN:

Docket: A-505-05

H.J. HEINZ COMPANY OF CANADA LTD.

Appellant

and

 

ATTORNEY GENERAL OF CANADA

Respondent

 

 

Docket: A-506-05

 

H.J. HEINZ COMPANY OF CANADA LTD. and

JAMES FRIEL

Appellants

and

 

ATTORNEY GENERAL OF CANADA

                        Respondent

 

REASONS FOR JUDGMENT

PELLETIER J.A.

INTRODUCTION

[1]               The issue in this appeal is the exemption from disclosure in the Access to Information Act, R.S.C. 1985, c. A-1 (the Act) in favour of confidential commercial information (paragraph 20(1)(b))

 

 

or competition sensitive information (paragraph 20(1)(c)). The appeal also raises the so-called relevance exception to disclosure.

 

[2]               In a decision reported at 2005 FC 1314, von Finckenstein J. of the Federal Court dismissed Heinz's application for a review of the decision of the Canadian Food Inspection Agency (the Agency) to disclose documents which Heinz claims are exempt from disclosure. Heinz now appeals to this Court from that decision.

 

THE FACTS

[3]               The facts are not complicated. The Agency received a request under the Act for records concerning:

…all submissions made by any party (including but not limited to H.J. Heinz Company of Canada Ltd. and the Consumers Association of Canada to the Canadian Food Inspection Agency and/or Agriculture Canada since January 1, 2001, regarding the adequacy, inadequacy, advisability, or legality of any restrictions on the format of containers, in terms of volume, weight or otherwise, for any food or drink, classified as infant or junior food under the Processed Products Regulations or any proposal for the amendment or replacement of that regulation as it applied to the container formats of infant and junior food.

 

 

[4]               The Agency identified certain documents which it considered responsive to the request, including seven documents which contained information about Heinz (the Records). On October 19, 2004, the Agency wrote to Heinz, identifying the documents in question and giving Heinz the opportunity to comment as to whether the documents should be released. The Records included the PowerPoint presentation (the Presentation) of a talk given by the appellant James Friel on behalf of Heinz. On November 17, 2004, the Agency wrote to Heinz once again to advise that it had located

 

 

another document which is considered responsive to the access request, specifically a submission made by Heinz to the Department of Health on the subject of infant nutrition (the Submission).

 

[5]               Heinz objected to the release of the Records on the ground that they contained commercial information which it had always treated as confidential, and invoked the exemption for confidential commercial information found at paragraph 20(1)(b) of the Act. Heinz argued that it enjoyed a very close relationship with the Agency in which there were often exchanges of confidential information, a relationship which would be impaired if information could not be shared in confidence. Heinz also contended that the release of the Records would affect its competitive position by alerting its competitors to the fact that it had made submissions on various topics and identifying the nature of those submissions. This would allow Heinz's competitors to take steps to counter Heinz's position.

 

[6]               Heinz objected to the disclosure of the Submission on the ground that it did not fall within the terms of the access request. Heinz's position was simply that since the document was not caught by the request, the question of exemptions did not arise.

 

THE DECISION UNDER APPEAL

[7]               Before addressing the application judge's reasons, a procedural clarification is required. Separate applications were made pursuant to section 44 of the Act with respect to the Records, and with respect to the Submission. The two applications were consolidated by order and were heard together. The present appeal was taken from the decisions in each of the two applications. These reasons are common to both files; a copy will be placed in each file.

 

 

[8]               The application judge considered the standard of review, and relying upon the decision of this Court in Wyeth-Ayerst Canada Inc. v. Canada (Attorney General), 2003 FCA 257, concluded that the standard applicable to access to information cases was that of correctness.

 

[9]               The application judge then considered Heinz's arguments with respect to the commercial confidential nature of the information contained in the Records. He rejected Heinz's submissions on that issue on the ground that the content of the documents had nothing to do with Heinz's commercial operations. As the application judge put it, "They [the records and the presentation] merely reveal Heinz's concern with nutrition and its fear that smaller sizes may lead to poorer nutrition." As a result, he dismissed Heinz's objection based upon paragraph 20(1)(b) of the Act on the ground that Heinz had failed to establish that the documents contained commercial information.

 

[10]           Heinz's argument with respect to the competition sensitive nature of the documents was also rejected. Heinz argued that the disclosure of the Records would allow its competitors to fashion a narrow focussed response to its submissions, thereby reducing the cost of making such submissions and prejudicing Heinz's financial position. The application judge rejected this argument out of hand. He thought that it would not come as a surprise to anyone to learn that Heinz had made representations to government on these issues since it was one of the largest players in the food industry.

 

[11]           Finally, the application judge dealt with the Submission. He noted Heinz's reliance on the case of Cistel Technology Inc. v. Canada (Correctional Service), 2002 FCT 253, in which the Court found that two documents which did not come within the terms of the access request did not have to

 

be disclosed. The application judge declined to follow Cistel on the basis that it had not been followed in two subsequent cases: Canadian Tobacco Manufacturer's Council v. Canada (Minister of National Revenue), 2003 FC 1037, and Mead Johnson Nutritionals, a division of Bristol-Myers Squibb Canada Co. v. Canada (Attorney General), 2005 FC 235.

 

[12]           In the Canadian Tobacco Manufacturer's Council case, the Court took the position that section 6 of the Act contained no prohibition against releasing information which did not come within the scope of the request. In the Court's view, it would take a substantial amount of "reading in" to find a prohibition on the release of information that was not relevant to the request.

 

[13]           In Mead Johnson Nutritionals, the Federal Court relied upon this Court's decision in Saint John Shipbuilding Ltd. v. Canada (Minister of Supply and Services) (F.C.A.) (1990), 67 D.L.R. (4th) 315, in which it was held that "the appellant's interest, as third party intervenor in a request for information, is limited to those matters set out in subsection 20(1), and it has no status to object that the government may have given more or less than it was asked for." As a result, in Mead Johnson Nutritionals, the Court concluded that a third party cannot complain if a government institution proposes to disclose records which go beyond the four corners of the request.

 

[14]           In the end result, the application judge dismissed Heinz's application.

 

 

 

 

 

ANALYSIS

[15]           I adopt the reasoning of Richard C.J. in Wyeth-Ayerst Canada Inc. on the issue of standard of review and conclude, as he did, that a decision as to the application of the exemptions under the Act to any particular record is to be reviewed on the standard of correctness.

 

[16]           The first issue is whether the documents in question contain:

b) financial, commercial, scientific or technical information that is confidential information supplied to a government institution by a third party and is treated consistently in a confidential manner by the third party;

 

[17]           A review of the Records shows that, with the exception of the Presentation, they consist of exchanges of correspondence between Heinz and an official of the Agency with respect to certain proposed regulatory changes in which Heinz sometimes comments on the changes by reference to its practices. Heinz's argument is that the disclosure of these Records would reveal certain commercial information and that it would impair its relation of confidence with the Agency.

 

[18]           A review of the confidential affidavit of Becky McMullin, the Agency's deponent, leaves one unclear as to the circumstances giving rise to the Records. The Records are said to contain Heinz's response to certain proposals with respect to the amendment of the Processed Products Regulations, SOR/82-701 (the Regulations). However, Ms McMullin's affidavit does not explain how Heinz became aware of the proposed changes to the Regulations and whether Heinz, along with the rest of the industry, was invited to comment on the proposed amendments or whether Heinz simply took it upon itself to communicate its views to the Agency.

 

 

 

[19]           The only portion of Ms McMullin's affidavit which bears on this question is paragraph 32 in which she notes that the very existence of the Records demonstrates that Heinz is engaged in making submissions to the Agency on the subject of the Regulations. This, it is said, would confirm to Heinz's competitors that Heinz is making such submissions which would enable them to counter Heinz's submissions by their own.

 

[20]           In my view, this does not suggest a process of open consultation with the industry. If comments had been solicited from the industry, everyone would assume that Heinz, by virtue of the scale of its operations, would comment. Thus, the suggestion that the release of the information would alert Heinz's competitors to the fact that it was intervening in the process leads one to believe that these communications were not the result of a request for public comment. All of this to say that Heinz does not appear to be in a position to claim that it provided the Records to the Agency at its request, or as part of a process of public consultation. The evidence before me leads to the conclusion that Heinz forwarded this information to the Agency on its own initiative without any assurance from the Agency that it would be treated in confidence.

 

[21]           It is with that background in mind that I approach the issue of the claim for an exemption on the ground that the documents contain confidential commercial information. I have reviewed the documents in issue. I do not agree with the application judge's conclusion that the Records deal only with Heinz's regulatory strategy. The Records refer to specific practices or ingredients in relation to certain classes of prepared foods. They also address the issue of packaging. I am satisfied that the documents contain commercial information, broadly defined.

 

 

[22]           I now turn to the issue of confidentiality. It is settled law that any claim of confidentiality must satisfy both a subjective and an objective element: see Maislin Ind Ltd. v. Canada (Min Ind Trade & Commerce Reg Economic Expansion), [1984] 1 F.C. 939. The subjective element is the party's own belief as to the confidentiality of the information and its consistent treatment of it as such. The objective element is an objective assessment of the confidential nature of the information based on its content and the circumstances under which it is transmitted to government: see Canada (Information Commissioner) v. Canada (Canadian Transportation Accident Investigation and Safety Board), 2006 FCA 157, at para. 72, and the authorities cited there. The locus classicus of the test of confidentiality is Air Atonabee Ltd. v. Canada (Minister of Transport), (1989) 27 F.T.R. 194 (F.C.T.D.), in which MacKay J. articulated the objective element of the test for confidentiality as follows at page 210:

…whether information is confidential will depend upon its content, its purposes and the circumstances in which it is compiled and communicated, namely:

 

(a)                 that the content of the record be such that the information it contains is not available from sources otherwise accessible by the public or that could not be obtained by observation or independent study by a member of the public acting on his own,

 

(b)                 that the information originate and be communicated in a reasonable expectation of confidence that it will not be disclosed, and

 

(c)                that the information be communicated, whether required by law or supplied gratuitously, in a relationship between government and the party supplying it that is either a fiduciary relationship or one that is not contrary to the public interest, and which relationship will be fostered for public benefit by confidential communication.

 

 

 

[23]           The communications in question here (apart from the Presentation and the Submission) are all communications by a regulated entity to its regulator dealing with changes to the regulatory regime. Even if Heinz had a subjective expectation that such communications would not be disclosed, there could be no objective basis for such an expectation. Changes to a regulatory regime

 

are matters of public interest. The public has a legitimate interest in knowing the extent to which regulated entities have influenced the regulator and for whose benefit.

 

[24]           Heinz claims that there is a confidential relationship between it and the Agency based on the presence of Agency inspectors in its plants. While Heinz can reasonably expect that information gathered by Agency inspectors will not be used for purposes other than the enforcement of the relevant legislation, the relationship is not a confidential relationship. It is a relationship between the regulator and the regulated and, as such, is necessarily subject to public scrutiny. While the scale of Heinz's operations may give it easy access to the Agency, that ease of access is not to be taken for confidential access. Nothing in the material before me establishes that Heinz has a confidential relationship with the Agency.

 

[25]           The application judge adverted to these considerations in his reasons, though he did so when dealing with the claim for an exemption under paragraph 20(1)(c) of the Act. At paragraph 19 of his reasons, he described the process by which government seeks input from stakeholders when considering legislative amendments. After setting out the elements of the process, he went on to say:

For this process to be effective, it has to be open and transparent. To suggest that the government cannot disclose (especially when asked under an access request) a policy openly advocated by one of the stakeholders, that in no way reflects any of the operational concerns or impacts of the stakeholder, merely because it may reveal that stakeholder's regulatory policy (i.e. its position), completely flies in the face of the purpose of the Act. This would make meaningful government consultations impossible.

 

[26]           I would not characterize the contents of the communications as the application judge did, but I agree with his reasoning as to the nature of the process. I have already said that I do not agree with the application judge's assertion that the information in question here is not commercial

 

information. However, I do agree that the process of public consultation, if that is indeed what is in issue here, is not advanced by Heinz's claim of confidentiality. As the application judge pointed out, the development of public policy requires a public debate, a process which is neutered if every communication to government is sheltered under the rubric of confidential communications.

 

[27]           The Presentation stands on slightly different factual footing but is caught by the very same principle. While the Presentation did not deal with the specifics of regulatory reform, it was a communication intended to influence the regulatory process, and as such, it was not a communication which occurred in the context of a confidential relationship.

 

[28]           Heinz also sought to shelter the Records in question under paragraph 20(1)(c) which deals with records whose disclosure could affect a third party's competitive position. In this case, Heinz says that the disclosure of its position on regulatory change would allow its competitors to challenge that position. With respect, this is the very raison d'être for access to information legislation. It exists to allow others, including competitors, to take issue with special pleading. In any event, nothing has been produced to me which would satisfy me that the disclosure of the Records would expose Heinz to a reasonable expectation of probable harm: see Canada Packers Inc. v Canada (Minister of Agriculture), [1989] 1 F.C. 47, at p. 60.

 

[29]           The application judge did not err in dismissing this element of Heinz's application.

 

 

 

 

[30]           The last issue is Heinz's claim that it was entitled to raise the issue of whether the documents which the Agency proposed to disclose were within the terms of the original request. As noted earlier, the application judge based his decision upon two prior decisions of the Federal Court which limited the grounds for non-disclosure to those set out in section 20 of the Act. Those decisions are supported by the earlier decision of this in Saint John Shipbuilding Ltd. where Hugessen J.A. (as he then was) said:

…Two minor points should be mentioned in closing. First, the appellant suggested that the material ordered to be released was in some respects different from what had been requested; the short answer to that is that the appellant's interest, as third party intervenor in a request for information, is limited to those matters set out in subsection 20(1), and it has no status to object that the Government may have given more or less than it was asked for.

 

[31]           This issue has received further consideration since Saint John Shipbuilding Ltd. was decided. In Siemens Canada Ltd. v. Canada (Minister of Public Works and Government Services) (Siemens) 2001 FCT 1202, (2001), 213 F.T.R. 125, aff'd 2002 FCA 414, (2002), 21 C.P.R. (4th) 575, this Court, in very brief reasons, allowed a third party to raise issues of national security in the course of a section 44 review. Siemens was followed by this Court in H.J. Heinz Co. of Canada Ltd. v. Canada (Attorney General), 2004 FCA 171, [2005] 1 F.C.R. 281, in which the third party was allowed to raise the exemption for personal information in section 19 of the Act, even though the personal information in question related to a person other than the third party. On appeal to the Supreme Court, this Court's judgment was affirmed (2006 SCC 13, [2006] 1 S.C.R. 441). It can now be said to be settled law that a third party is not limited to the grounds set out in section 20.

 

[32]           That said, does the Act allow a third party to resist disclosure on the ground that the document in question is not within the class of documents requested in the access request? The relevant provisions of the Act are the following:

 

[33]           In early litigation, the Federal Court held that only documents which had been requested were required to be disclosed: see Canadian Jewish Congress v. Canada (Minister of Employment and Immigration), [1996] 1 F.C. 268, at para. 72-73; Cistel. However, the general trend in the Federal Court has favoured disclosure of documents even though they may not fall within the four corners of the access request. For example, in the Canadian Tobacco Manufacturer's Council case, Russell J. held that the Act favours disclosure, not non-disclosure. The judge found that "The fact that there is no obligation on an institution to disclose irrelevant information to a requester does not give third parties a right to prevent disclosure on the grounds of irrelevancy.": see para. 93 of the application judge's reasons. The same conclusion was reached in Canadian Pacific Hotels Corp. v. Canada (Attorney General), 2004 FC 444,/ and in Mead Johnson Nutritionals.

 

[34]           The judges of the Federal Court have tended to come to this conclusion on the basis that there is no exemption in favour of "irrelevant" documents, and consequently there is no barrier to their disclosure. In my view, this analysis is misleading. Heald J. was correct when he concluded in

 

 

Canadian Jewish Congress that the only documents whose disclosure can be compelled are "requested documents". Consequently, if the disclosure of "non-requested" documents cannot be compelled, there is no obligation to which an exemption against their disclosure could apply. This does not mean that "non-requested" documents are not subject to the exemptions. If certain types of information are exempted from mandatory disclosure, it stands to reason that they are also exempted from voluntary disclosure via "non-requested" documents.

 

[35]           But, the fact that disclosure cannot be compelled does not mean that it is forbidden. The starting point of any analysis of this question is section 4 of the Act which makes it clear that the premise of the Act is that citizens and permanent residents have a right to be given access to any document under the control of a government institution. The purpose of the written request is to identify the nature of the records being sought so that they can be identified and brought forward. A written access request serves to define the relevant documents, not to exclude them. The presumptive right of access conferred by section 4 applies to all documents, including those not described in an access request. Consequently, the answer to the objection to the disclosure of    "non-requested" or "irrelevant" documents is the affirmation of the presumptive right to access, and not the absence of an exemption for "non-requested" or "irrelevant" documents.

 

[36]           In the end result, I would dismiss the appeal with costs to the respondent.

 

"J.D. Denis Pelletier"

"I agree

     A.M. Linden J.A."

"I agree

     B. Malone J.A."

 

 

FEDERAL COURT OF APPEAL

 

NAMES OF COUNSEL AND SOLICITORS OF RECORD

 

DOCKET:                                                                              A-505-05

 

APPEAL FROM A JUDGEMENT OR ORDER OF THE FEDERAL COURT DATED SEPTEMBER 26, 2005, DOCKET NO. T-474-04.

 

STYLE OF CAUSE:   H. J. HEINZ COMPANY OF CANADA LTD. v. ATTORNEY

                  GENERAL OF CANADA

 

DOCKET:                                                                              A-506-05

 

APPEAL FROM A JUDGMENT OR ORDER OF THE FEDERAL COURT DATED

SEPTEMBER 26, 2005, DOCKET NO. T-2214-04.

 

STYLE OF CAUSE:   H.J. HEINZ COMPANY OF CANADA LTD. and JAMES FRIEL

                  v. ATTORNEY GENERAL OF CANADA

 

PLACE OF HEARING:                      Ottawa, Ontario

 

DATE OF HEARING:                       October 11, 2006

 

REASONS FOR JUDGMENT BY:                                     PELLETIER J.A.

 

CONCURRED IN BY:                                                         LINDEN J.A.

                                                                                                MALONE J.A.

 

DATED:                                                                                 November 17, 2006

 

APPEARANCES:

 

Craig Collins-Williams                                                              For the Appellant

 

Richard Casanova                                                                    For the Respondent

 

SOLICITORS OF RECORD:

 

Stikeman Elliott                                                                         For the Appellant

Ottawa, Ontario

 

John H. Sims, Q.C.                                                                  For the Respondent

Deputy Attorney General of Canada

Ottawa, Ontario