A-39-75
Okanagan Helicopters Ltd. (Applicant)
v.
Canadian Transport Commission and Erickson
Air-Crane Company (Respondents)
Court of Appeal, Jackett C.J., Pratte and Ryan
JJ.—Ottawa, March 17 and 20, 1975.
Judicial review—Appeal—Canadian Transport Commission
granting respondent temporary authority to operate air ser-
vice—Whether Commission erred in not giving applicant notice
of respondent's application and opportunity to be heard—
National Transportation Act, R.S.C. 1970, c. N-17 as am., s.
64(2) and (5)—Aeronautics Act, R.S.C. 1970, c. A-3 as am., s.
16(1), (3) and (4)—Federal Court Act, ss. 28 and 29—Air
Carrier Regs., SOR/72-145, ss. 3(1)(g)(ii), 8(6) and 9(d).
Apprehending possible application by respondent Erickson
for permission to import Skycrane aircraft for use in connection
with the "topping off" of the C.N. Tower in Toronto, Okana-
gan, a Canadian firm, informed the Commission that it had the
"capability and resources" for the task. Subsequently, Okana-
gan was granted a one-year authority to provide Skycrane air
service. On becoming aware that Erickson was endeavouring to
obtain authority, applicant asked the Commission that it be
informed of such applications, and that it be provided an
opportunity to make representations. Eventually, Erickson was
selected by Canron Limited, the Company responsible for
erecting the topmost part of the tower, and applied for a
licence. In view of the preference of C.N. Tower Ltd. and
Canron for Erickson, the Air Transport Committee granted it
the temporary authority. Okanagan maintained that in not
providing it with an opportunity to be heard in connection with
the Erickson application, the Committee breached the princi
ples of natural justice.
Held, dismissing the application and appeal, there is no
statutory or regulatory provision requiring the giving of notice
or an opportunity to be heard. Okanagan was not denied a
licence, nor was its one-year licence revoked or modified. It had
made no significant investment in reliance on its licence which
might, in the public interest, warrant protection. The facts do
not establish sufficient interest to confer the rights claimed.
The Committee did not err in law in considering the contract
bids, and the preference of the contractor for Erickson. Section
64(2) of the National Transportation Act provides for a right
of appeal to this Court regarding matters raised in the section
28 application. Because of section 29 of the Federal Court Act,
a section 28 application is not available. Under section 64(5) of
the National Transportation Act, the Court certifies to the
Commission that the appeal from the decision of the Commit
tee lacked merit.
JUDICIAL review and appeal.
COUNSEL:
F. Lemieux and M. Phelan for applicant.
W. G. St. John for respondent Canadian
Transport Commission.
D. I. Brenner for respondent Erickson Air-
Crane Company.
SOLICITORS:
Herridge, Tolmie, Gray, Coyne and Blair,
Ottawa, for applicant.
Legal Department, Canadian Transport
Commission for respondent Canadian Trans
port Commission.
Brenner, Abraham, Maxwell & Company,
Vancouver, for respondent Erickson Air-
Crane Company.
The following are the reasons for judgment
delivered orally in English by
RYAN J.: This is a section 28 application by
Okanagan Helicopters Ltd. (referred to in these
Reasons as "Okanagan") to review and set aside
the decision of the Air Transport Committee of the
Canadian Transport Commission, dated January
21, 1975, granting the respondent, Erickson Air-
Crane Company (referred to as "Erickson"), tem
porary authority to operate a Class 7 Specialty—
Aerial Construction—commercial air service 1 in
order to provide an S64E helicopter as required in
the construction of the C.N. Tower Building in
Toronto. It is also an appeal from the same deci
sion under subsection 64(2) of the National
Transportation Act 2 . The application and the
appeal were joined into one proceeding by order of
the Court.
Both Okanagan and Erickson had been aware
for some time prior to January 1974 of the C.N.
Tower project and were conscious of the capability
of the Sikorsky Skycrane helicopter for the work
involved. Canron Limited had been selected to
erect the topmost part of the tower structure,
Class 7 specialty aerial construction commercial air service
is a class of commercial air service established by subparagraph
3(1)(g)(ii) of the Air Carrier Regulations, SOR/72-145. It
relates to "the use of rotating wing aircraft in construction
work, including aerial hoisting, mountain tram line construc
tion, aerial pole setting and aerial power line construction".
2 R.S.C. 1970, c. N-17, as amended.
consisting of a 300-foot high steel mast weighing
about 300 tons. In connection with this project,
negotiations and technical discussions with Erick-
son had been proceeding at least since the summer
of 1973.
In November 1973, the solicitors for Okanagan
wrote to the Air Transport Committee with
respect to a possible application by Erickson for
permission to import S64E Skycrane aircraft for
use in the erection of the tower antenna. The
solicitors requested that there should be no allow
ance for importation of an S64 aircraft "as our
clients have the capability and resources and are
willing and able to provide this service".
The Secretary of the Air Transport Committee
replied on November 27, 1973:
We may say that it has been the Committee's policy to
require foreign carriers seeking to complete contracts for flying
services in Canada whenever possible to do so under the
authority of an appropriately licensed Canadian carrier.
It should be noted however that a Canadian carrier would of
necessity have to have the appropriate licensed authority before
any consideration could be given to the question of importing
aircraft even if only of a temporary nature.
By an order dated January 31, 1974, the Air
Transport Committee authorized Okanagan to
provide a Class 7 Specialty—Aerial construc-
tion—commercial air service using one Sikorsky
S64E (Skycrane) aircraft in Group E-RW under
its previously issued licence No. A.T.B. 512/
50(H). The authority was valid for one year, ter
minating January 31, 1975. Okanagan was
required by the order to apprise the Committee of
its future intentions on or before October 31, 1974.
A letter, dated January 22, 1974, from Ever
green Helicopters, Inc., McMinnville, Oregon, to
Okanagan has obvious relevance to the January
31, 1974, licence to Okanagan. The letter reads:
This letter coAfirms our intent to enter into a one year agree
ment with Okanagan Helicopters Ltd. for the lease of our S-64
to Okanagan for intermittent periods of time during the term of
the agreement.
In addition to providing the S-64 helicopter Evergreen Heli
copters is prepared to furnish as required qualified pilots,
qualified mechanics, maintenance to M.O.T. standards, support
equipment, spares and parts. Hull and full liability insurance
tailored to the requirements of each active time period the
aircraft operates in Canada will be provided to the extent
required by mutual agreement of the Parties hereto.
Okanagan will provide necessary Canadian clearance for entry
of the aircraft, crews, support gear and/or what may be
required to undertake each specific project during the term of
the agreement.
It is recognized that since each specific helicopter construction
project must be costed on its own merit and will involve varying
operational approaches, payment to Evergreen by Okanagan
for each project must be determined for each project. In view of
this fact lease payments will be calculated and mutually agreed
upon prior to the commencement of each project during the
term of the agreement.
By letter dated May 17, 1974, to the Secretary
of the Committee, the solicitors for Okanagan
stated that they were aware that another helicop
ter company was attempting to obtain Group E
authority to use larger aircraft in the rotating wing
field. They asked to be informed of such applica
tions and expressed an intention to intervene and
to make representations to the effect that the
granting of any additional Group E authority in
Canada could not be justified and would be detri
mental to the authority of Okanagan to provide
Group E aircraft in the aerial construction field. In
reply, the Secretary of the Committee wrote:
As you know, Class 7 Specialty Aerial Construction does not
require the giving of public notice, nor a showing of public
convenience and necessity. By reason of this, intervention is not
invited concerning particular applications.
On June 5, 1974, Okanagan through their solici
tors again wrote to the Committee indicating their
understanding that another person had applied for
either a Class 4 licence or a Class 7, Group E-RW
rotating wing licence. Again they requested an
opportunity to make submissions. This time the
reply was that applications for Class 4 would be
given public notice and that some sub-classifica
tions of Class 7 are given public notice: "In any
event, it is noted that you were asking for an
opportunity to make submissions in respect of such
applications and in this respect your request will
be given consideration and you will be informed of
the direction of the Committee as soon as such
direction is known." Presumably the direction in
mind would be a direction, if any, that the Com
mittee might give under subsection 8(6) of the Air
Carrier Regulations 3 .
By letter dated October 31, 1974, written pursu
ant to the terms of the Committee order of Janu-
ary 31, 1974, Okanagan requested continuation of
its licence to use a Sikorsky S64E (Skycrane)
aircraft in Group E-RW for a further one-year
period; it supported its request with particulars of
its future intentions: one circumstance mentioned
in the letter was that Okanagan "has become
engaged in dealing with Canron and advising them
of its efforts to provide the most economic S-64
service".
The Secretary of the Air Transport Committee
acknowledged this letter on December 13, 1974.
The Secretary's letter referred to a possible con
tract between Okanagan and Canron Limited:
I am directed to inform you that before the Committee can
reach a decision on the application for the extension of author
ity for a further one year period, the Committee requires
information in respect of contract figures from Okanagan in
respect of a possible contract with Canron Limited.
This letter also confirms the visit from Mr. K. W. Steele of
Okanagan Helicopters Ltd. in our offices last Wednesday,
December 11th, at which time Mr. Steele made mention of the
discussions which had been held with Canron Limited. It would
be helpful if you could provide the Committee with written
information concerning the progress which has been made and
which I believe may be related to a possible contract. I believe
it would also be helpful if some mention was made as to the
manner of arrangements proposed to be negotiated with respect
to the possible use of the Sky Crane in Canada under the
licence authority held by the Company.
The letter also acknowledged receipt of copies of
communications between Okanagan and Erickson
relating to possible arrangements between the
companies regarding the use of an Erickson Sky-
crane in Canada.
On December 30, 1974, Okanagan replied in
detail to the Committee letter of December 13,
Subsection 8(6) of the Air Carrier Regulations, SOR/72-
145, reads:
(6) The Committee may direct that such public or other
notice of an application as it deems reasonable be given by
and at the expense of the applicant.
1974. The reply stated that the company was
assembling data for the purpose of making a spe
cific proposal to Canron by January 15, 1975. It
also outlined possibilities and plans for developing
the helicopter market in the area of construction.
By letter dated December 5, 1974, Mr. Eccles,
Operations Manager of Canron Limited, Eastern
Structural Division, wroted to the solicitors for
Erickson. I quote from this letter:
After lengthy discussions with Erikson Air-Crane and Okana-
gan Helicopters Ltd., we have selected Erikson as the Company
best suited to provide us with helicopter service for this project.
However, we are advised by the Air Transport Committee,
Ottawa that Erikson has not applied for or obtained a license.
We therefore request that you expedite this application so that,
once obtained, we can finalize a contract with Erikson for the
performance of the work.
The application of Erickson, dated January 8,
1975, was sent to the Air Transport Committee by
Erickson's solicitors by letter dated January 13,
1975. The application was for temporary authority
to operate a Class 7 Specialty—commercial air
service—aerial construction using Group E-RW
aircraft; specifically it was for permission to pro
vide helicopter service to assist Canron Limited in
supplying and erecting the antenna mast structure
for the C.N. Tower project in Toronto.
The Erickson application made reference to
Okanagan and to support for the application from
Canron and C.N. Tower Limited in the following
passages:
Erickson Air-Crane Company submits that there is no operator
presently licenced in Canada who has either the trained person
nel or the technical expertise required to perform the proposed
service. It is further submitted that Erickson Air-Crane Com
pany is the only operator in the world presently capable of
providing the unique and specialized service that is required to
erect the antenna mass structure on the CN tower project.
This application is made with the full knowledge and support of
both Canron Limited and CN Tower Limited as indicated by
the attached exhibits.
The applicant is aware of the Committee's guide lines respect
ing the licencing of foreign air carriers; however, in this case,
for the purpose of completing the steel erection on the CN
Tower site the applicant respectfully submits that there is no
operator in Canada qualified to provide the proposed service.
To the best of the applicant's knowledge, only one Canadian air
carrier is presently licenced to operate S-64E aircraft in
Canada. This operator, Okanagan Helicopters Ltd. obtained a
temporary one (1) year authority in January or February in
1974 and entered into a lease agreement with Evergreen Heli
copters Ltd. of Oregon. Notwithstanding this Okanagan/Ever-
green "arrangement", neither of these Companies have ever
operated a S-64E in Canada either before or after this author
ity was obtained.
While Okanagan Helicopters Ltd. was invited by Canron Lim
ited to bid on the CN Tower erection project, as of January 3,
1975, Canron had received no adequate proposals from Okana-
gan. In any event however, Canron does not consider that either
Okanagan Helicopters Ltd. or Evergreen Helicopters Ltd. has
the technical expertise required to perform the service that the
applicant proposes to provided.
5. PRESENT TRANSPORTATION FACILITIES
As outlined herein, there are no S-64E aircraft based in
Canada and available for hire. The one Canadian licencee,
Okanagan Helicopters Ltd., has never operated a S-64E in
Canada since it obtained a one year temporary operating
authority, which authority is almost due to expire.
By letter dated January 15, 1975, Okanagan
made a detailed proposal in respect of helicopter
services to Canron Limited. A copy of this pro
posal, with a breakdown of the pricing, was sent to
the Air Transport Committee. By telex of January
17, 1975, Canron Limited informed the Commis
sion of the figures for lump sums and extras
submitted by Okanagan and Erickson in their bids
to provide helicopter services for the tower
antenna.
Okanagan also sent a message to the Commis
sion that was marked as having been received on
January 20, 1975, asking to be informed of any
applications for special permission to operate
Group E aircraft in Canada and requesting the
opportunity of attending on the Committee before
a decision was taken.
I would add that immediately before the Erick-
son application was heard by the Air Transport
Committee, Malachy Grant, Director of Design
and Construction, C.N. Tower Ltd., sent a telex
message to the Commission in which he said that
his company had analyzed the alternatives and was
concerned that "... it would not be wise to use any
crew other than the Erickson pilots on this project.
Other firms have experience in locating hydro or
microwave lines but we feel that the Erickson firm
is much more experienced in construction type
operations which are more delicate and vulnerable.
We would not feel confident using a less
experienced crew." He also gave a comparison of
the Okanagan and Erickson bids, showing that
that of Okanagan was $197,000 over that of Erick-
son. He emphasized the urgency of the matter: the
helicopter operation was expected to begin as early
as March 1, 1975.
On January 21, 1975, the Secretary of the Air
Transport Committee sent a telex message to the
solicitors of Erickson informing them of the deci
sion of the Committee on the Erickson application.
A confirming letter reads:
Reference is hereby made to an application under cover of a
letter dated January 13th on behalf of Erickson Air-Crane
Company in the matter of temporary authority to operate a
Class 7 Specialty—Aerial Construction—commercial air ser
vice, to provide an S64E helicopter as required in the construc
tion of the C.N. Tower Building.
I am directed to inform you that the Committee has con
sidered the said application and has noted that to this date no
Canadian commercial air carrier owns or has operated a
Sikorsky S64E in Canada. In view of the unique nature of the
erection operations requiring the use of an S64E (Skycrane)
helicopter, the weights and elevations involved, the imminent
scheduling of the said work to be performed in erecting the
antenna atop the C.N. Tower Building on behalf of C.N. Tower
Ltd. and its contractor for this purpose—Canron Ltd., Eastern
Structural Division, and further in view of the clearly expressed
preference of C.N. Tower Ltd. and Canron Ltd. to engage the
expertise of Erickson Air-Crane Company for this work, the
Committee is satisfied that it would be in the public interest to
permit Erickson Air-Crane Company to enter Canada to pro
vide the required services in this case only—subject to it being
awarded the contract for the provision of S64E aircraft in this
connection, and further, subject to meeting the requirements of
Ministry of Transport and other government departments
concerned.
The foregoing serves to confirm Committee telex of January
21, 1975, which provided advance notice in the subject matter.
With respect to Ministry of Transport, its regional offices in
Toronto should be contacted as early as possible and in any
event prior to an S64E entering Canadian airspace. A copy of
this authority must be immediately available to Canadian
authorities during operations with the said machine in Canada.
In support of its application and appeal, Okana-
gan submitted that "... by not providing the
applicant [Okanagan] with an opportunity to
make representations in connection with the
application by Erickson Air-Crane to operate a
Skycrane helicopter in Canada, the Air Transport
Committee breached the principles of natural
justice."
The decision to permit Erickson to provide the
required helicopter service for construction of the
antenna on the C.N. tower was made under sub
section 16(1) of the Aeronautics Act', which
reads`:
16. (1) The Commission may issue to any person applying
therefor a licence to operate a commercial air service in the
form of licence applied for or in any other form.
Subsections 16(3) and 16(4) provide:
(3) The Commission shall not issue any such licence unless it
is satisfied that the proposed commercial air service is and will
be required by the present and future public convenience and
necessity.
(4) The Commission may exempt from the operation of the
whole or any part of subsection (3), any air carrier or commer
cial air service or any class or group thereof, except a scheduled
commercial air service operating wholly within Canada or the
operator thereof either generally or for a limited period or in
respect of a limited area, if in the opinion of the Commission
such exemption is in the public interest.
By virtue of paragraph 9(d) of the Air Carrier
Regulations, a person who applies for a licence to
operate a Class 7 Specialty commercial air service
for aerial construction is excluded from the opera
tion of subsection 16(3) of the Act.
There is no specific statutory or regulatory
provision that would require the giving of notice to
Okanagan of the Erickson application or affording
Okanagan the opportunity to be heard in respect
of it. The question remains, however, whether,
apart from specific statutory or regulatory man
date, the principles of natural justice would exact
notice to Okanagan and some opportunity to make
submissions.
This is not a case in which Okanagan was
denied a licence, nor is it one in which its one-year
licence, granted January 31, 1974, in respect of the
use of a Sikorsky S64E (Skycrane) aircraft was
either revoked or modified. The January 31, 1974
4 R.S.C. 1970, c. A-3, as amended.
order did not purport to place Okanagan in a
position of monopoly. Actually, the period stipulat
ed in that order had almost come to an end when
the Erickson permit was granted. During the one-
year experimental period Okanagan had not
acquired an S64E aircraft; at most, it had Ever
green's statement of intent to lease such an air
craft to it and to provide the crew. There is not
here a situation in which a licensee, in justifiable
reliance on its licence or on an expectation of
renewal, had made a significant investment which
might in the public interest arguably warrant pro
tection, at least for a time, against a competitor.
The hard, central fact of this case is that Okana-
gan and Erickson had competed for a specific job,
the Toronto tower antenna contract, and subject to
getting the licence in question, Erickson had obvi
ously won. Okanagan would itself have had to get
its licence renewed had it been the winner. Okana-
gan's interest in making submissions to the Com
mittee was its interest in seeing that Erickson was
not given the permission that would enable it to
take up the contract. Just possibly, I suppose, if
Erickson's application had been denied and
Okanagan's own licence were renewed, Okanagan
might have succeeded in getting the antenna con
tract by default, and just possibly, if it had secured
the contract, Okanagan's position in respect of its
application for renewal might have been somewhat
improved. This, however, is all so very speculative
and does not, in my view, establish a sufficient
interest to warrant conferring on Okanagan a
natural justice right to be given notice of and to
participate in a proceeding having to do with
Erickson's application for a one-job permit.
Actually, I am more concerned over the effect of
the adverse assertions respecting Okanagan in
Erickson's application. But I do not believe that, in
the circumstances of this case, the fact they were
made is enough to confer on Okanagan the right to
notice and hearing where, apart from the allega
tions, there was no such right.
In a case such as this, determination of status to
participate requires a careful weighing of the facts
in respect of the interests asserted, and a practical
judgment on whether in the circumstances fairness
requires notice and an opportunity to make sub
missions. I have decided that in this case it does
not.
Okanagan also submitted that the Air Transport
Committee erred in law by taking into account the
contract bids for the antenna job and the prefer
ence of the contractor for Erickson. This submis
sion is not sustainable.
Under subsection 64(2) of the National Trans
portation Act there is a right of appeal to this
Court in respect of matters raised in the section 28
application to review and set aside. Because of
section 29 of the Federal Court Act, it follows that
in this case a section 28 application is not available
to the applicant. The section 28 application should
therefore be dismissed.
I would also dismiss the appeal brought under
subsection 64(2) of the National Transportation
Act, and under subsection 64(5) I would certify to
the Canadian Transport Commission our opinion
that the appeal from the decision of the Air Trans
port Committee, dated January 21, 1975, granting
Erickson Air-Crane Company temporary authority
to operate a Class 7 Specialty—aerial construc-
tion—commercial air service in order to provide an
S64E helicopter as required in the construction of
the C.N. Tower building in Toronto lacked merit.
* * *
JACKETT C.J. concurred.
* * *
PRATTE J. concurred.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.