When is a Court not a Court? Windsor (City) v. Canadian Transit Co., 2016 SCC 54
A majority of the Supreme Court of Canada took the opportunity presented by Windsor (City) v. Canadian Transit Co., 2016 SCC 54 to raise serious questions about the status and role of Canada’s federal courts.
A purely jurisdictional issue arose here for consideration. The company was incorporated under federal law as the owner and operator of the Ambassador Bridge linking Windsor to Detroit. In Canada, interprovincial and international bridges are the responsibility of the federal authorities. As part of its plans to improve the Bridge, the company has purchased many properties in Windsor. These are now in varying states of disrepair. Concerned about urban decay, the City issued repair orders. The company wishes to argue that the by-law under which the City issued the repair orders is not applicable because of the operation of the doctrine of interjurisdictional immunity, which protects federally created enterprises from provincial laws that impair their operations. Where can the company make this argument? Must it go to Ontario’s Superior Court of Justice, or can it go to Federal Court (as it sought to do)?
The majority concluded, per Karakatsanis J., that the Federal Court does not have jurisdiction at all. Without delving into the detail of the discussion of s. 23(c) of the Federal Courts Act, the implausibility of majority’s conclusion is well summarized by Moldaver and Brown JJ. in dissent:
This case involves a federal company, created under a specially enacted federal statute, whose sole function under the statute is to operate a federal undertaking and whose claim for declaratory relief focusses exclusively on its right to carry out its statutory mandate free from unconstitutional constraints imposed by municipal bylaws (at para. 118).
This is not to say that the Federal Court should hear the application. It is simply to say that it could do so. Here, there were good reasons for the Federal Court to decline to do so as a matter of discretion (at para. 120). Section 23(c) gives the Federal Court concurrent, not exclusive jurisdiction, and the Ontario courts might be better placed to address comprehensively the company’s constitutional concerns.
More remarkable than the majority’s implausible conclusion are the comments made by Karakatsanis J. at paras. 70-71:
Since the ITO test is not met, it is also unnecessary to consider the Federal Court of Appeal’s holding that the Federal Court has the remedial power to declare legislation to be constitutionally invalid, inapplicable or inoperative. I decline to comment on this issue, except to say this. There is an important distinction between the power to make a constitutional finding which binds only the parties to the proceeding and the power to make a formal constitutional declaration which applies generally and which effectively removes a law from the statute books.
The Federal Court clearly has the power, when the ITO test is met, to make findings of constitutionality and to give no force or effect in a particular proceeding to a law it finds to be unconstitutional. The Federal Court of Appeal in this case appears to have held that the Federal Court also has the power to make formal, generally binding constitutional declarations. My silence on this point should not be taken as tacit approval of the Federal Court of Appeal’s analysis or conclusion.
See similarly her remarks at para. 33:
The Federal Court, by contrast, has only the jurisdiction it has been conferred by statute. It is a statutory court, created under the constitutional authority of s. 101, without inherent jurisdiction. While the Federal Court plays a critical role in our judicial system, its jurisdiction is not constitutionally protected in the same way as that of a s. 96 court. It can act only within the constitutional boundaries of s. 101 and the confines of its statutory powers (one footnote omitted).
And in footnote 2:
Although the Federal Courts Act describes the Federal Court as a “superior court” (ss. 3 and 4), this description means only that its jurisdiction is “supervisory” (Commonwealth of Puerto Rico v. Hernandez, 1973 CanLII 184 (SCC),  1 S.C.R. 228, at p. 233, per Pigeon J.). The Federal Court is not a superior court in the true sense of possessing inherent jurisdiction.
The upshot would seem to be that the Federal Court is not really a court, its existence to be suffered rather than celebrated. (In passing, if the Federal Court of Appeal is also only a “statutory court” rather than an intermediate appellate court, are panels bound by decisions of previous panels? Stare decisis operates only in attenuated form in respect of statutory bodies.)
One can contrast Karakatsanis J.’s restrictive approach to jurisdictional issue and to the Federal Court more generally with the approach set out in Canada (Human Rights Commission) v. Canadian Liberty Net,  1 SCR 626, a decision which Karakatsanis J. did not consider. In response to an argument based on the assertion that the Federal Court was a “mere” statutory body (at para. 22), Bastarache J. set out the general historical and constitutional background before concluding:
These are the historical and constitutional factors which led to the development of the notion of inherent jurisdiction in provincial superior courts, which to a certain extent has been compared and contrasted to the more limited statutory jurisdiction of the Federal Court of Canada. But in my view, there is nothing in this articulation of the essentially remedial concept of inherent jurisdiction which in any way can be used to justify a narrow, rather than a fair and liberal, interpretation of federal statutes granting jurisdiction to the Federal Court. The legitimate proposition that the institutional and constitutional position of provincial superior courts warrants the grant to them of a residual jurisdiction over all federal matters where there is a “gap” in statutory grants of jurisdiction, is entirely different from the proposition that federal statutes should be read to find “gaps” unless the words of the statute explicitly close them. The doctrine of inherent jurisdiction raises no valid reasons, constitutional or otherwise, for jealously protecting the jurisdiction of provincial superior courts as against the Federal Court of Canada (at para. 34, emphasis added).
I would add that s. 101 of the Constitution Act 1867, which provides the constitutional basis for the creation of the Federal Court (and Federal Court of Appeal) is the same s. 101 of the Constitution Act that provides the basis for the creation of the Supreme Court. Indeed, the Supreme Court held in the Supreme Court Act Reference,  1 SCR 443 that it had been imbued with a “constitutional status” that “initially arose from the Court’s historical evolution into an institution whose continued existence and functioning engaged the interests of both Parliament and the provinces” (at para. 76). This conclusion was supported by reference to a variety of factors (discussed in this article) relating to the Court’s ascent to the apex of Canada’s judicial hierarchy. But could one not tell a similar tale of the evolution of the federal courts? As Moldaver and Brown JJ. explained:
The history of the Federal Court reveals that it was intended by Parliament to have broad jurisdiction. The Exchequer Court, created in 1875, initially had limited jurisdiction: it could hear certain claims against the Crown, and eventually, claims relating to patents, copyrights, public lands, and railway debts..During the 20th century, however, it became apparent that the Exchequer Court could not deal with many matters that transcended provincial boundaries, and that confusion, inconsistency, and expense tended to accompany litigation of these national matters in the provincial superior courts.
These problems prompted Parliament in 1970 to replace the Exchequer Court with the Federal Court, and to expand the Federal Court’s jurisdiction (Federal Court Act, S.C. 1970-71-72, c. 1). According to the Minister of Justice, the Federal Court was designed to achieve two objectives: first, ensuring that members of the public would “have resort to a national court exercising a national jurisdiction when enforcing a claim involving matters which frequently involve national elements”; and second, making it possible for “litigants who may often live in widely different parts of the country to [have] a common and convenient forum in which to enforce their legal rights” (House of Commons Debates, vol. V, 2nd Sess., 28th Parl., March 25, 1970, at p. 5473) (at paras. 77-78).
Bastarache J. commented in similar terms in Canadian Liberty Net:
As is clear from the face of the Federal Court Act, and confirmed by the additional role conferred on it in other federal Acts, in this case the , Parliament intended to grant a general administrative jurisdiction over federal tribunals to the Federal Court. Within the sphere of control and exercise of powers over administrative decision-makers, the powers conferred on the Federal Court by statute should not be interpreted in a narrow fashion. This means that where an issue is clearly related to the control and exercise of powers of an administrative agency, which includes the interim measures to regulate disputes whose final disposition is left to an administrative decision-maker, the Federal Court can be considered to have a plenary jurisdiction (at para. 36).
There is no reason that the constitutional alchemy s. 101 is said to have performed on the Supreme Court could not also be performed on the federal courts. Could we not say that, by overseeing the federal administration, the federal courts provide a vital national service? Could we not say that this role has repeatedly been recognized — and expanded — by Parliament? Might we not even say that the Federal Courts Act is a quasi-constitutional statute?
One doubts, however, that the current Supreme Court would come to this conclusion. Karakatsanis J.’s broadside seems to have been prompted by the Federal Court of Appeal’s eminently reasonable and carefully supported suggestion in Canadian Transit that it could make declarations of invalidity. If so mild a suggestion provokes such a vitriolic response, an argument that s. 101 also recognizes the constitutional status of the federal courts would no doubt receive a withering put-down.
And Canadian Transit is not an isolated example. Previously, in Strickland v. Canada (Attorney General), 2015 SCC 37, Abella and Wagner JJ. queried “the assumption that the Federal Court has exclusive jurisdiction to declare invalid all federal regulations promulgated by the Governor in Council” (at para. 67). For my part, I have no difficulty in understanding why everyone involved in that case (or any other case) would think that the Federal Court has the exclusive jurisdiction mentioned. One simply needs to read s. 18.1 of the Federal Courts Act: “the Federal Court has exclusive original jurisdiction (a) to issue an injunction, writ of certiorari, writ of prohibition, writ of mandamus or writ of quo warranto, or grant declaratory relief, against any federal board, commission or other tribunal…” The closing words are defined to mean “any body, person or persons having, exercising or purporting to exercise jurisdiction or powers conferred by or under an Act of Parliament or by or under an order made pursuant to a prerogative of the Crown” (s. 2(1)). See Cromwell J.’s careful explanation at para. 64.
This content has been updated on December 12, 2016 at 14:04.