Resisting which Siren’s Call? Auer v Auer, 2022 ABCA 375 and TransAlta Generation Partnership v Alberta (Minister of Municipal Affairs), 2022 ABCA 381
In a pair of decisions this week the Alberta Court of Appeal has tackled the question of the framework for judicial review of regulations: Auer v. Auer, 2022 ABCA 375 and TransAlta Generation Partnership v. Alberta (Minister of Municipal Affairs), 2022 ABCA 381. In both instances — Governor-in-Council regulations on support payments in Auer, ministerial regulations about property taxation assessment in TransAlta — the Court applied the framework set out in Katz Group Canada Inc. v. Ontario (Health and Long‑Term Care), 2013 SCC 64,  3 SCR 810 rather than the reasonableness standard from Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65,  4 SCR 653.
In Auer, Feehan JA has brief concurring reasons. I entirely agree with his statement, at para. 120: “A determination of the vires, the powers granted or limited, of delegated legislation including regulations is a form of judicial review contemplated in Vavilov,paras 66, 111, 137; see Portnov v Canada (Attorney General), 2021 FCA 171, paras 49-52; John Mark Keyes, “Judicial Review of Delegated Legislation: The Long and Winding Road to Vavilov”, 2020 CanLIIDocs 3679, pp 7-9, <ssrn.com/abstract=3630636>”.
I came to the same conclusion as Feehan JA in my detailed analysis of this issue (see here). Without rehashing this analysis, I would offer the following observations on the decisions in Auer and TransAlta.
First, the Alberta Court of Appeal has sought to create a regulation carve out from the Vavilov framework. The argument advanced by Pentelchuk JA in Auer is that Governor-in-Council regulations are not administrative decisions subject to the Vavilov framework:
Governor in Council regulations, however, are not examples of “administrative decision-making”; in this context, enacting regulations involves the creation of the law. Enacting a regulation is not a “decision” in the Vavilov sense. The various expressions in Vavilov that it intends to unify the standard of review analysis in all cases do not apply to legislative acts (at para. 79).
But, with respect, Pentelchuk JA makes no attempt (as far as I can see) to ground this carve out in the language of Vavilov itself. She adds instead a gloss to Vavilov: it does not apply to the creation of “law”. Leaving aside the proposition that regulations are “law” and the references to a series of cases dealing with judicial review of legislation rather than delegated legislation (at paras. 47-53), the fact of the matter is that there is no basis in Vavilov to draw this new distinction. It would also be contrary to the Vavilovian purposes of simplification and clarity to introduce any new distinction into the standard of review framework.
Now, one possible Vavilov-based argument would be that the presumption of reasonableness review does not apply because the legislation in issue did not “create” the Governor-in-Council (Vavilov, at para. 24). However, this argument would not be persuasive in any event. When empowered by statute to make regulations, or Orders in Council, the Governor-in-Council is acting pursuant to statutory authority and subject to the principles of the common law just like any other administrative decision-maker. Of course, in Vavilov the majority of the Supreme Court did not provide a list of all the “administrative decisions” subject to its new framework: the majority referred repeatedly to “administrative decisions” and “administrative decision-makers” to denote the phenomenon with which the majority was concerned, namely, judicial control of decision-makers empowered by statute. Indeed, as Feehan JA observes, the majority reasons in Vavilov proceed on the assumption that regulations are a type of administrative decision: where regulations or case law about regulations are mentioned, they are mentioned in the context of the Vavilov framework, with no suggestion that there is a bespoke regime or carve out for regulations. This is entirely sensible, because whilst regulations will sometimes have the general character they had in Auer they will sometimes target a specific individual or group and may be indistinguishable from individualized administrative decisions.
Accordingly, if the presumption of reasonableness review is to be rebutted or escaped from, regulations must fall into one of the correctness categories either because the rule of law or institutional design is engaged. Tellingly, Pentelchuk JA makes no attempt to fit regulations into a correctness category. She opts instead for a carve out which is difficult to reconcile with the letter and spirit of the Vavilov framework.
Now, it is true that the majority of the Supreme Court did not “explicitly” state that regulations are subject to the Vavilov framework (TransAlta, at para. 47). But the majority of the Supreme Court “explicitly” said that procedural fairness was not covered by the Vavilov framework, only to apply the framework to procedural fairness at the first opportunity, in Law Society of Saskatchewan v. Abrametz, 2022 SCC 29. Abrametz underscores the extent to which Vavilov is a general framework for judicial review, thereby undermining any proposition that a failure to mention a particular type of decision in Vavilov means that the framework does not apply to a particular type of decision.
Second, given Pentelchuk JA’s reliance on the proposition that regulations involve law-making and are therefore subject to less intrusive judicial review for separation of powers reasons, it is only fair to point out that regulations are executive action, not legislative action. Indeed, she acknowledges as much: “Regulations, on the other hand, are generated internally by the executive branch of government… The regulations are therefore generated by the government to flesh out the policy set by the statute” (at para. 67). Exactly! Regulations are executive (i.e. administrative) action, not legislative action. They might take legislative form, but they are not actually legislative. They flesh legislation out but they are not legislation. The same is true of all types of administrative action.
Third, the TransAlta decision represents a significant extension of the logic in Auer. There Pentelchuk JA was greatly impressed by the fact that regulations are subject to parliamentary scrutiny, suggesting that this is the “singular distinction” between “true” regulations and municipal bylaws, law society rules and so on which are subject to the Vavilov framework (at para. 34). But in TransAlta, the regulations were made by a minister — not the cabinet — under a statute which specifically exempts the regulations from the scrutiny provisions of the provincial Regulations Act: Municipal Government Act, s. 322(3). The logic of Auer was taken to extend beyond the Governor-in-Council and to another type of executive action that takes legislative form. That logic surely extends further still, to any law-like administrative action, such as municipal bylaws, law society rules and so on. But if so, there is a problem because, as Feehan JA points out (Auer, at para. 122), the application of reasonableness review by the Supreme Court to those types of administrative decision pre-dates Vavilov.
Fourth, much of the analysis in Auer and TransAlta is based (with respect) on what I think is a false premise, namely that reasonableness review invites review of the merits of governmental policy decisions:
A true Vavilov approach can only be accomplished by the reviewing court descending into a consideration of the merits of the policy decisions underlying the regulation and formulating its own reasons why the regulation was a reasonable policy choice. Thus, a reasonableness review of Governor in Council regulations under Vavilov becomes a Rorschach test that is vulnerable to a reviewing court’s particular view on the merits of the policy choices underlying the regulation and a prognostication of the regulation’s likely effect. (Auer, at para. 75, see also at para. 58).
It is sufficient for our purposes to say, as this Court said in Auer at paras 47-63, that a court reviewing regulations must take care to avoid examining the merits of an authorized policy choice. To decide whether a valid regulation is, in outcome, “reasonable” is to judge the merits of the path chosen by the delegated lawmaker to achieve the objectives of the enabling statute. That is not the court’s role (TransAlta, at para. 50)
To be fair to the Alberta Court of Appeal, use of the term “merits” is apt to cause confusion. The majority of the Supreme Court certainly said in Vavilov (at para. 23) that its new framework was for the review of the “merits” of administrative decisions. But the majority was using “merits” in that context only to distinguish them from procedural review. Review of the “merits” in Vavilov is shorthand for substantive review, i.e. the grounds and intensity of review of the substance of administrative decisions. The reference to “merits” in Vavilov does not mean courts have a licence to second-guess administrative decisions. Indeed, much of the analysis in Vavilov is designed to prevent second-guessing (see e.g. at paras. 75, 93, 102).
Indeed, where the Governor-in-Council has made what Pentelchuk JA would describe as a “true” regulation, judicial review for reasonableness is likely to be relatively less searching, precisely because a reviewing court cannot question the merits of the regulation. But of course in situations where a regulation targets a particular individual or group, judicial review for reasonableness may be more searching: more may be required by way of justification. This flexibility is built into the Vavilov framework. It is precisely why Vavilov works as a general framework, adaptable to different situations and scenarios, as the relevant constellation of facts and law will vary according to circumstance.
True, commitment to flexibility means that judicial review of regulations will look somewhat different to judicial review of, say, adjudicative decisions. This is not to ‘gloss’ over difficulties in applying Vavilov to regulations (Auer, at para. 75). Rather, it represents contemporary recognition of the well-established appreciation of Canadian courts that reasons and records for decision sometimes come from unlikely sources: see especially Baker v. Canada (Minister of Citizenship and Immigration),  2 SCR 817, at para. 44 and more recently Canadian Centre for Bio-Ethical Reform v. Grande Prairie (City), 2018 ABCA 154, at paras. 40-42. Vavilovian reasonableness review might even create pressure to expand the record normally put before a court when reviewing cabinet decisions (see e.g. Canada Mink Breeders Association v. British Columbia, 2022 BCSC 1731) but again this phenomenon pre-dates Vavilov: see here.
Finally, Pentelchuk JA suggests that I and others — including (improbably!) the Federal Court of Appeal — have been “seduced” by judicial interventionism (Auer, at para. 61). I would caution that there are many sirens’ calls attracting those who navigate the deep seas of administrative law. In particular, there is a constant refrain from a chorus of sirens about the need for executive policy decisions to be immune from or protected from review, be it in administrative law, tort, contract or otherwise. I fear the Alberta Court of Appeal may too readily have heeded this call. For my part, I would say that Vavilov sets a course based on principles of clarity and simplicity. It is not the course I would have chosen, but I think it is likely to keep us on an even keel through choppy waters. Better then, in my view, to lash ourselves to the mast of simplicity and clarity so as not to succumb to the calls of the sirens.
This content has been updated on November 24, 2022 at 01:51.