Federal Court of Appeal Decisions

Date: 20130215

Docket: A-309-12

Citation: 2013 FCA 44

 

CORAM:       BLAIS C.J.

                        MAINVILLE J.A.

                        WEBB J.A.

 

BETWEEN:

TELUS COMMUNICATONS COMPANY

Appellant

and

NORTHWESTEL INC., BELL CANADA,

ROGERS CABLE COMMUNICATIONS INC.,

SASKATCHEWAN TELECOMMUNICATIONS AND

PRIMUS TELECOMMUNICATIONS CANADA INC.

Respondents

 

 

 

Heard at Ottawa, Ontario, on January 29, 2013.

Judgment delivered at Ottawa, Ontario, on February 15, 2013.

 

REASONS FOR JUDGMENT BY:                                                                               WEBB J.A.

CONCURRED IN BY:                                                                                                  BLAIS C.J.

MAINVILLE J.A.

 

Date: 20130215

Docket: A-309-12

Citation: 2013 FCA 44

 

CORAM:       BLAIS C.J.

                        MAINVILLE J.A.

                        WEBB J.A.

 

BETWEEN:

TELUS COMMUNICATONS COMPANY

Appellant

and

NORTHWESTEL INC., BELL CANADA,

ROGERS CABLE COMMUNICATIONS INC.,

SASKATCHEWAN TELECOMMUNICATIONS AND

PRIMUS TELECOMMUNICATIONS CANADA INC.

Respondents

 

 

REASONS FOR JUDGMENT

WEBB J.A.

[1]               This is an appeal from the decision of the Canadian Radio-television and Telecommunications Commission (CRTC) dated March 14, 2012 (Telecom Order CRTC 2012-151). The CRTC held that:

(a)          the amendment to the Interconnection and Service Agreement between Northwestel Inc. (Northwestel) and Bell Canada;

 

(b)          the 800 service origination agreement between Northwestel and Rogers Cable Communications Inc. (Rogers); and

 

 

(c)          the 800 service origination agreement between Northwestel and Saskatchewan Telecommunications (SaskTel)

 

were all approved under section 29 of the Telecommunications Act, S.C. 1993, c. 38 (Act). The CRTC also held that it was appropriate to consider these agreements for approval under section 29 and not section 25 of the Act. Some of the amounts that would be paid under the agreements were redacted in the copies of the agreements that were made available to the public, although these amounts were disclosed to the CRTC. Additionally, the CRTC held that since Primus Telecommunications Canada Inc. (Primus) was not a carrier, the agreement between Northwestel and Primus was not subject to the provisions of section 29 of the Act.

 

[2]               Telus Communications Company (Telus) has appealed this decision under section 64 of the Act. Telus argues that the approval of the agreements under section 29 of the Act does not exempt Northwestel from the requirements of section 25 of the Act and that the amounts to be paid by each of Bell Canada, Rogers, and SaskTel to Northwestel must be included in a tariff that is filed (and then disclosed) under section 25 of the Act. Telus agreed that the section 29 of the Act did apply to these agreements but submitted that section 25 of the Act would also apply. As well, Telus submitted that since the CRTC held that no approval of the agreement between Northwestel and Primus was required under section 29 of the Act, the amounts that would be paid by Primus to Northwestel must be included in a tariff that is filed and approved under section 25 of the Act.

 

[3]               Telus submitted that the standard of review was correctness while Northwestel argued that the applicable standard was reasonableness. In this case I would reach the same conclusion whether the applicable standard is correctness or reasonableness and therefore it not necessary to determine which standard of review is appropriate.

 

Legislative Provisions

[4]               Sections 25, 26 and 29 of the Act provide as follows:

 

Agreements with Bell Canada, Rogers, and SaskTel

[5]               The agreement between Northwestel Inc. and Bell Canada is an amending agreement dated January 1, 2010. This was the second amendment to the original agreement that was dated January 1, 2003. The original agreement, as described in the first recital in the Amending Agreement that was submitted for approval, was an agreement for “Interconnection and Settlement of services between Northwestel and Bell”. The amending agreement replaced article 4.1 (b) of Schedule C to Appendix A of the original agreement (as previously amended) with the following:

(b) For Bell Canada Attributed Traffic Bell Canada shall pay to Northwestel:

 

(i)                 For traffic in the Eastern Arctic the Northwestel Bundled CAT plus the tariffed satellite proxy transport charge as noted in Northwestel tariff CRTC 21480 Item 40; and

 

            •      For traffic in the Western Arctic the Northwestel Bundled CAT plus its per minute transport charge of [**] per minute in 2010.

 

[6]               Since the amount that Bell Canada would be paying for traffic in the Eastern Arctic was noted in a tariff that was published, this appeal does not relate to this amount. This appeal arises because the amount that would be paid for traffic in the Western Arctic was not disclosed to the public. It is the position of Telus that the amount that Bell Canada would be paying for traffic in the Western Arctic should have been set out in a tariff (that would have been published) in the same manner as the amount that would be paid for traffic in the Eastern Arctic was set out in a published tariff.

 

[7]               In the agreements with Rogers and SaskTel, the payment paragraphs provide as follows:

Rogers

3.1       For each minute of 1-800 traffic, Rogers shall pay to Northwestel the sum of the following:

 

…

 

b)         Transport and access tandem charge to Signal Transfer Point

 

i)      For all 1-800 traffic originating in Northwestel’s western area, Rogers shall pay to Northwestel a transport and access tandem charge of [**] per minute.

 

ii)     For all 1-800 traffic originating in Northwestel’s eastern area, Rogers shall pay to Northwestel a transport and access tandem charge of [**] per minute.

 

SaskTel

3.1       For each minute of 1-800 traffic, SaskTel shall pay to Northwestel the sum of the following:

 

…

 

3.2       a)         For all 1-800 traffic originating in Northwestel’s western area, SaskTel shall pay to Northwestel a transport and access tandem charge of [**] per minute.

 

b)           For all 1-800 traffic originating in Northwestel’s eastern area, SaskTel shall pay to Northwestel a transport and access tandem charge of [**] per minute.

 

[8]               It is the position of Telus that section 25 of the Act (in addition to section 29 of the Act) applies to the amounts that would be paid by Rogers and SaskTel to Northwestel under these agreements.

 

Decision of the CRTC

[9]               In brief reasons, the CRTC held that the agreements between Northwestel and Bell Canada, Rogers and SaskTel were approved under section 29 of the Act and that the amounts that each of these companies would pay to Northwestel would remain confidential and would not be disclosed to the public. In its decision the CRTC noted as follows:

7.             The Commission notes that subsection 29(c) of the Act applies to agreements between carriers for the apportionment of revenues between the carriers. The Commission considers that it is clear that the negotiated rates in the agreements are used to apportion revenues, which are collected from end-customers for the payment of long distance and 800 calls, between the parties to the agreements.

 

8.             The Commission notes that it has approved numerous agreements between carriers that contain the same type of confidential, negotiated rates for the apportionment of revenue pursuant to section 29 of the Act. The Commission also notes that it has not required these rates to be tariffed The Commission considers that, consistent with its previous treatment of these types of agreements, the consideration of approval for the Northwestel agreements pursuant to section 29 of the Act and not section 25 is appropriate.

 

9.             The Commission considers that the negotiated, confidential rates contained in the agreements between Northwestel and Bell Canada, RCCI, and SaskTel are reasonable and appear not to unduly discriminate between carriers.

 

Analysis

[10]           Telus argues that Northwestel will be providing telecommunication services under its agreements with Bell Canada, Rogers, and SaskTel. The definitions of telecommunication service and related provisions are set out in the Appendix to these reasons. Section 25 of the Act provides that “[n]o Canadian carrier shall provide a telecommunications service except in accordance with a tariff filed with and approved by the Commission…”. Telus submits that, therefore, Northwestel could not provide the services as contemplated by the agreements referred to above until the amounts to be paid by Bell Canada, Rogers and SaskTel under these agreements are also tariffed under section 25 of the Act.

 

[11]           Telus referred to a number of prior decisions of the CRTC (or its predecessor). However, Telus did not refer to any decision of the CRTC (or its predecessor) in which the CRTC (or its predecessor) specifically determined that once an agreement has been approved under section 29 of the Act, any amounts to be paid under that agreement must also be tariffed under section 25 of the Act. Telus referred in particular to the following excerpt from the decision of the Board of Transport Commissioners in Union Telephone Co. Ltd. v. Bell Telephone Co. of Canada (1954) 71 CRTC 81:

By s. 380 of the Railway Act, R.S.C. 1952, c. 234, Bell is required to file with the Board its tariffs of tolls charged to the public and to secure the Board’s approval thereof. Additionally, all contracts, agreements and arrangements for the interchange of messages or service, and the divisions of revenue and the management, working or operation thereof, are subject to the Board’s approval.

 

[12]           In that case Union Telephone Co. Ltd. (Union) was asking the Board to order Bell Telephone Co. of Canada to pay Union for the use of Union’s facilities when long distance calls were made using such facilities. This was not a case where approval of an existing agreement was being sought and it seems to me that the comments of the Board referred to above were simply general comments in relation to the applicable statute. In my view, the use of the word “additionally” simply means that it is another requirement of the statute and should not be construed as an interpretation of how the two provisions would apply in the situation as contemplated by this appeal.

 

[13]           The Supreme Court of Canada in The Queen v. Canada Trustco Mortgage Company, 2005 SCC 54, [2005] 2 S.C.R. 601, stated that:

10.    It has been long established as a matter of statutory interpretation that “the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament”: see 65302 British Columbia Ltd. v. R., [1999] 3 S.C.R. 804 (S.C.C.), at para. 50. The interpretation of a statutory provision must be made according to a textual, contextual and purposive analysis to find a meaning that is harmonious with the Act as a whole. When the words of a provision are precise and unequivocal, the ordinary meaning of the words play a dominant role in the interpretive process. On the other hand, where the words can support more than one reasonable meaning, the ordinary meaning of the words plays a lesser role. The relative effects of ordinary meaning, context and purpose on the interpretive process may vary, but in all cases the court must seek to read the provisions of an Act as a harmonious whole.

 

[14]           The amount that would be paid by the end-customers, as acknowledged by both Telus and Northwestel, was the subject of a tariff that either:

(a)           would have been filed and approved under section 25 of the Act; or

(b)          would have been exempted from such filing and approval requirements as a result of a determination by the CRTC, as provided in section 34 of the Act.

Amounts under the agreements between Northwestel and Bell Canada, Rogers and SaskTel would only be paid once calls are made and, as found by the CRTC, the agreements simply apportioned the revenue (which would be tariffed rate or the exempted rate) that would be generated when such calls are made. It does not seem to me that in reading the Act as a harmonious whole that the object of the Act and the intention of Parliament would be fulfilled if both sections 25 and 29 of the Act would apply to the amounts to be paid under these agreements and therefore Northwestel would be required to obtain two approvals of the amounts that would be paid by Bell Canada, Rogers and SaskTel. In approving the agreements between Northwestel and Bell Canada, Rogers and SaskTel under section 29 of the Act, the CRTC approved the amounts that each of theses companies would be paying to Northwestel. It would not be a reasonable interpretation of the Act to require the CRTC to again approve these same amounts under section 25 of the Act.

 

[15]           In my view paragraph 7(f) of the Act supports this interpretation. This paragraph provides as follows:

 

Requiring Northwestel to obtain two approvals of the amounts to be paid to it under its agreements with Bell Canada, Rogers and SasklTel would not result in efficient and effective regulation.

 

[16]           Telus submitted that in applying section 25 of the Act, the amounts would only need to be filed, not approved. However, it seems to me that section 25 of the Act cannot be separated into two parts. Both the filing requirement and the approval requirement are included in section 25 of the Act. As well section 26 provides that once the tariff is filed, the approval process must follow. It is not possible to split section 25 of the Act into two parts – a filing requirement and an approval requirement – especially since section 26 of the Act would reintroduce the approval requirement.

 

[17]           As a result, it does not seem to me that there is any basis on which to interfere with the decision of the CRTC in relation to the agreements between Northwestel and Bell Canada, Rogers and SaskTel. The CRTC should be afforded deference in determining whether section 25 or section 29 of the Act will apply in any particular situation.

 

Agreement with Primus

[18]           In its letter to the CRTC dated August 26, 2011, Telus raised the issue of whether section 25 of the Act would apply to four agreements, one of which was the agreement between Northwestel and Primus. In the agreement between Northwestel and Primus, Primus agreed to pay certain undisclosed amounts for 1-800 traffic originating in Northwestel’s western and eastern areas. The CRTC held that since Primus was a reseller (and not a carrier), section 29 of the Act did not apply to that agreement. That decision was not challenged by Telus. However, the CRTC did not address the issue of whether section 25 of the Act would apply in relation to the amounts that would be paid by Primus under this agreement. Section 29 of the Act applies if there is an agreement between a “Canadian carrier” and “another telecommunications common carrier”. However, section 25 of the Act applies if a Canadian carrier (in this case, Northwestel) provides a telecommunication service without identifying the person to whom the service is provided. Therefore the rationale for not applying section 29 of the Act (that Primus was not a carrier) would not apply to section 25 of the Act since Northwestel is a Canadian carrier.

 

[19]           Since section 29 of the Act did not apply, there is also no argument that two approvals would be required under the Act if section 25 of the Act were to apply to the amounts to be paid by Primus to Northwestel.

 

[20]           There was also no indication that any determination had been made under section 34 of the Act in relation to any telecommunication service to be provided by Northwestel to Primus that would have provided that section 25 of the Act did not apply to the amounts to be paid by Primus to Northwestel for such service. Accordingly the matter should be referred back to the CRTC to determine whether section 25 of the Act should apply to the amounts to be paid by Primus under its agreement with Northwestel. The CRTC should consider whether it will require any additional submissions from Telus, Northwestel or Primus in relation to this matter.

 

Conclusion

[21]           I would therefore dismiss the appeal, with costs, in relation to the agreements between Northwestel and Bell Canada, Rogers, and SaskTel. I would refer the matter back to the CRTC in relation to the agreement between Northwestel and Primus for a determination by the CRTC with respect to whether section 25 of the Act applies to the amounts to be paid under this agreement.

 

“Wyman W. Webb"

“I agree

Pierre Blais C.J.”

 

“I agree

Robert M. Mainville J.C.A.”

Appendix

to File A-309-12

dated February 15, 2013

 

Excerpts from section 2 of the Telecommunications Act S.C. 1993, c. 38

 

 

 

FEDERAL COURT OF APPEAL

 

NAMES OF COUNSEL AND SOLICITORS OF RECORD

 

 

 

DOCKET:                                                                             A-309-12

 

STYLE OF CAUSE:                                                            Telus Communication Company v Northwestel Inc. et al

 

PLACE OF HEARING:                                                      Ottawa, Ontario

 

DATE OF HEARING:                                                        January 29, 2013

 

REASONS FOR JUDGMENT BY:                                   WEBB J.A.

 

CONCURRED IN BY:                                                        BLAIS C.J., MAINVILLE J.A.

 

 

DATED:                                                                                February 15, 2013

 

 

APPEARANCES:

 

Michael H. Ryan Stephen R. Schmidt	FOR THE APPELLANT
Nicholas McHaffie	FOR THE RESPONDENT NORTHWESTEL INC.

 

SOLICITORS OF RECORD:

 

Chief Regulatory Legal Counsel TELUS Communications Company Ottawa, Ontario	FOR THE APPELLANT
Stikeman Elliott LLP Ottawa, Ontario	FOR THE RESPONDENT NORTHWESTEL INC.