Date: 20080206

Docket: A-177-07

Citation: 2008 FCA 42

 

CORAM:       DÉCARY J.A.

                        NOËL J.A.

                        SHARLOW J.A.

 

BETWEEN:

CANADIAN PACIFIC RAILWAY COMPANY

Appellant

and

CANADIAN TRANSPORTATION AGENCY,

ATCO PIPELINES, a division of ATCO GAS AND PIPELINES

 

Respondents

 

 

 

Heard at Edmonton, Alberta, on January 15, 2008.

Judgment delivered at Ottawa, Ontario on February 6, 2008.

 

REASONS FOR JUDGMENT BY:                                                                          SHARLOW J.A.

CONCURRED IN BY:                                                                                                 DÉCARY J.A.

                                                                                                                                          NOËL J.A.

 

 

Date: 20080206

Docket: A-177-07

Citation: 2008 FCA 42

 

CORAM:       DÉCARY J.A.

                        NOËL J.A.

                        SHARLOW J.A.

 

BETWEEN:

CANADIAN PACIFIC RAILWAY COMPANY

Appellant

and

CANADIAN TRANSPORTATION AGENCY,

ATCO PIPELINES, a division of ATCO GAS AND PIPELINES

 

Respondents

 

 

REASONS FOR JUDGMENT

SHARLOW J.A.

[1]               The Canadian Pacific Railway Company (CPR) is appealing, with leave, Decision No. 709-R-2006 of the Canadian Transportation Agency dated December 22, 2006. In that decision, the Agency granted the application of Atco Pipelines, a division of Atco Gas and Pipelines Ltd., for the authority to construct above ground safety valves for its natural gas pipeline at two locations where the pipeline runs under the CPR railway right of way, parallel to the railway track. CPR argues that this decision is not within the jurisdiction of the Agency. The issue raised in the appeal is whether the portions of the pipeline on which the safety valves are to be constructed fall within the definition of “utility crossing” in section 100 of the Canada Transportation Act, S.C. 1996, c. 10.

 

Statutory provisions

(A) Canada Transportation Act

[2]               The relevant provisions of the Canada Transportation Act are sections 98, 100 and 101, and the definition of “railway” in section 87. All of these provisions are found in Part III, entitled “Railway Transportation”. The definition of “railway” reads as follows:

 

[3]               The definition of “railway” quoted above was enacted in 1996. Its statutory predecessor is found in section 2 of the Railway Act, R.S.C. 1985, c. R-3 (S.C. 1952, c. 234). That definition reads as follows:

 

[4]               Sections 98, 100 and 101 of the Canada Transportation Act read as follows:

 

[5]               Section 326 of the Railway Act, the statutory predecessor to section 101 of the Canada Transportation Act, dealt with the construction and maintenance of utility lines near railway lines. That provision reads as follows:

 

(B) Railway Safety Act

[6]               The point of statutory interpretation in issue in this case requires consideration of a related statute, the Railway Safety Act, R.S.C. 1985, c. 32 (4^th Supp.). The Railway Safety Act and the regulations made under that Act establish railway safety standards for, among other things, the construction, maintenance and operation of a “railway work”. Those regulations are administered by the Minister of Transport.

 

[7]               The term “railway work” is defined in section 4 of the Railway Safety Act to include any “crossing work”, which in turn is defined to include any “utility crossing”. The definition of “utility crossing” in the Railway Safety Act is substantially the same as the definition in the Canada Transportation Act.

 

Facts

[8]               Atco owns and operates a natural gas pipeline in Alberta. The pipeline was built by Atco’s corporate predecessor, Canadian Western Natural Gas Company Limited. A portion of the pipeline, approximately 20 miles long, is located on the CPR railway right of way between Kananaskis and Banff, between mile 57.85 and mile 76.95. That 20 mile portion of the pipeline runs mostly beside the CPR railway track on the railway right of way, and it crosses under the railway track at three locations. Permission to build that 20 mile portion of the pipeline was given to Canadian Western Natural Gas Company Limited by CPR pursuant to an agreement dated June 30, 1951.

 

[9]               In 2004, Atco filed the 1951 agreement with the Canadian Transportation Agency pursuant to subsection 101(1) of the Canada Transportation Act. By virtue of subsection 101(2), the 1951 agreement became an order of the Agency (Order No. 2004-AGR-478 dated November 16, 2004). The record discloses no evidence that CPR objected to the filing of the 1951 agreement, or to the resulting order.

 

[10]           It is undisputed that the proposed construction of the above ground valves is part of the maintenance of the existing pipeline and is intended to improve the safety of the pipeline, in that installing the valves above ground will make it easier to shut the pipeline down in an emergency.

 

[11]           It is also undisputed that the 1951 agreement does not expressly permit the construction of above ground valves on any portion of the pipeline covered by the agreement. Atco attempted to negotiate an agreement with CPR for authorization to construct the safety valves. When no agreement could be reached, Atco applied to the Agency for authorization pursuant to subsection 101(3) of the Canada Transportation Act, S.C. 1996, c. 10.

 

Standard of review

[12]           CPR argues that, in an appeal from a decision of the Agency on a question of the interpretation of a statutory provision that defines the Agency’s jurisdiction, the standard of review is correctness. That argument is based on Canadian Pacific Railway Co. v. Canada (Transportation Agency) (C.A.), [2003] 4 F.C. 558 (at paragraphs 14 to 21), which followed Barrie Public Utilities v. Canadian Cable Television Assn., [2003] 1 S.C.R. 476 (at paragraphs 10 to 19).

[13]           The Agency and Atco argue that the standard of review is reasonableness. They rely on a more recent decision of the Supreme Court of Canada, Council of Canadians with Disabilities v. Via Rail Canada Inc., [2007] 1 S.C.R. 650. That was an appeal from a decision of this Court reversing a decision of the Agency requiring Via Rail Canada Inc. to take certain steps to accommodate disabled passengers. In that case Justice Abella, writing for the majority, discussed the issue of standard of review at paragraphs 87 to 111. The key passages appear at paragraphs 98 to 100, and read as follows:

 

[98] The Canada Transportation Act is highly specialized regulatory legislation with a strong policy focus.  The scheme and object of the Act are the oxygen the Agency breathes.  When interpreting the Act, including its human rights components, the Agency is expected to bring its transportation policy knowledge and experience to bear on its interpretations of its assigned statutory mandate […].

 

[99] The allegedly jurisdictional determination the Agency was being asked to make […] falls squarely within its statutory mandate.  It did not involve answering a legal question beyond its expertise, but rather requires the Agency to apply its expertise to the legal issue assigned to it by statute.  […].

 

[100] The Agency is responsible for interpreting its own legislation, including what that statutory responsibility includes.  The Agency made a decision with many component parts, each of which fell squarely and inextricably within its expertise and mandate.  It was therefore entitled to a single, deferential standard of review.

 

[14]           In my view, the nature of the legal issue in this case is sufficiently like the legal issue in the Via Rail case that the same standard of review should apply. It follows that this Court is bound to apply the standard of review applied in Via Rail, which is reasonableness.

Discussion

[15]           The position of CPR is that the definition of “utility crossing” in the Canada Transportation Act is not broad enough to capture the portions of the Atco pipeline where Atco proposes to construct the above ground valves, because at those locations the pipeline runs beside the railway track, not under it. That position is based on a literal meaning of the words, “the part of a utility line that passes over or under a railway line”, assuming the words “railway line” mean only “railway track” and cannot have a broader meaning. CPR points to the distinction between the words used in the current definition (“over or under a railway line”), and the words used in its statutory predecessor, section 326 of the Railway Act (“along or across a railway”). CPR also relies on section 98 of the Canada Transportation Act (quoted above), in which the phrase “railway line” is apparently used to mean a railway track. According to the interpretation proposed by CPR, the fact that the work is to be done on the railway right of way is irrelevant, no matter how close the work may be to the railway track.

 

[16]           The position of Atco and the Agency relies on the purposive, contextual approach adopted in Rizzo and Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27 and numerous decisions of the Supreme Court of Canada decided after that case. They argue that, given the purpose of the statutory scheme and the statutory context, the phrase “railway line” is intended to include the right of way on which a railway track is located. It follows that the definition of “utility line” would include any part of a pipeline that is on or under the railway right of way.

[17]           There is no jurisprudence squarely on point. However, the Agency’s conclusion on this point is supported by Canadian National Railway Co. v. Canada (Canadian Transportation Agency) (1999), 251 N.R. 245 (F.C.A.). In that case, this Court upheld the decision of the Agency that section 98 of the Canada Transportation Act (quoted above), which requires the Agency approval for the construction of a “railway line”, applied to the construction of a railway yard. Justice Rothstein, then a member of this Court, explained as follows (at paragraph 8):

 

[18]           The Agency also points to its Decision No. 124-R-1997, in which the Agency applied section 101 to an application for a power line to be placed on a railway right of way, to run parallel to the track without crossing it. The application in that case had been commenced under section 326 of the Railway Act (quoted above), and continued under the Canada Transportation Act by virtue of the Discontinuance and Continuance of Proceedings Order, 1996, SOR/96-383.

 

[19]           Other jurisprudential support for the proposition that a railway line includes the railway right of way are found in decisions of the Agency relating to the determination of the salvage value of a railway line, which includes the value of the land comprising the right of way: Agency Decisions  175-R-1999 (Tisdale Subdivision Decision), 467-R-1996 (CN Chatham Subdivision), 530-R-1998 (CP Goderich Subdivision), 545-R-1999 (CN Arbourfield Subdivision), 542-R-2000 (CN Cudworth Subdivision).

 

[20]           The Minister of Transport apparently agrees with Atco and the Agency. The Minister has asserted jurisdiction over the railway safety implication of the proposed construction of above ground valves, relying on the definition of “utility crossing” in the Railway Safety Act. As mentioned above, that definition is substantially the same as the definition of “utility crossing” in the Canada Transportation Act. It is undisputed that if the Agency has erred in its interpretation of the definition of “utility crossing” in the Canada Transportation Act, the Minister has made the same error in relation to the Railway Safety Act. If that is the case, then a question would arise as to whether and to what extent the Railway Safety Act gives the Minister the statutory authority to consider railway safety issues in relation to the proposed work.

 

[21]           Given the statutory context, the Agency’s interpretation gives the language of the definition of “utility line” a meaning that it can reasonably bear, and that is consistent with its purpose. In my view, the Agency’s interpretation of the definition of “utility line” is reasonable. I see no basis for the intervention of this Court.

 

[22]           I would add that I would have proposed the same result if the standard of review had been correctness. I do not accept that Parliament, in the course of enacting the current interrelated statutory schemes for the regulation of railways and railway safety, intended to adopt legislation that would preclude those schemes from applying to the construction of above ground safety valves on a natural gas pipeline located on a railway right of way.

 

Conclusion

[23]           For these reasons, I would dismiss this appeal with costs.

“K. Sharlow”

“I agree

            Robert Décary J.A.”

 

“I agree

            Marc Noël J.A.”

FEDERAL COURT OF APPEAL

 

NAMES OF COUNSEL AND SOLICITORS OF RECORD

 

 

DOCKET:                                                                              A-177-07

 

STYLE OF CAUSE:                                                              CANADIAN PACIFIC RAILWAY COMPANY v. CANADIAN TRANSPORTATION AGENCY ET AL

 

PLACE OF HEARING:                                                        EDMONTON, ALBERTA

 

DATE OF HEARING:                                                          JANUARY 15, 2008

 

REASONS FOR JUDGMENT BY:                                     SHARLOW J.A.

 

CONCURRED IN BY:                                                         DÉCARY J.A.

                                                                                                NOËL J.A.

 

DATED:                                                                                 FEBRUARY 6, 2008

 

APPEARANCES:

 

Mr. Glen Poelman  Mr. Ryan Penner	FOR THE APPELLANT
Ms. Andray Renaud     Mr. Donald Cranston Mr. Peter Wong	FOR THE RESPONDENT  - Canadian Transportation Agency   FOR THE RESPONDENT – ATCO Pipelines

SOLICITORS OF RECORD:

 

Macleod Dixon LLP Calgary, Alberta	FOR THE APPELLANT
Canadian Transportation Agency, Gatineau, Quebec   Bennett Jones LLP Edmonton, Alberta	FOR THE RESPONDENT     FOR THE RESPONDENT