A-16-77
Sarco Canada Limited (Applicant)
v.
Anti-dumping Tribunal (Respondent)
and
Sarco Company Inc. and Escodyne Limited
(Intervenants)
Court of Appeal, Heald and Le Dain JJ. and
MacKay D.J.—Toronto, May 16 and 17; Ottawa,
June 9, 1978.
Judicial review — Decision of Anti-dumping Tribunal con
cerning injury to production in Canada of "like goods" —
Material received and considered in manner not contemplated
by Act — Applicant denied opportunity to test information
received and relied on — Whether or not Tribunal construed
term "like goods" correctly — Whether or not respondent
failed to properly conduct inquiry in manner contemplated by
Act — Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 28
— Anti-dumping Act, R.S.C. 1970, c. A-15, ss. 2(1), 13(1),
14(1), 16(1).
This is a section 28 application to review and set aside a
decision of the Anti-dumping Tribunal in which it found that
the dumping into Canada of certain products had not caused,
was not causing nor was likely to cause material injury to the
production in Canada of like goods. The applicant alleges error
in law and in jurisdiction in that respondent incorrectly con
strued the term "like goods" as used in the Anti-dumping Act.
The applicant's second submission of error as to jurisdiction is
that respondent failed to properly conduct the inquiry—a con
dition precedent to its finding. The Tribunal received and
considered material obtained in a manner not contemplated by
the Act, so that applicant was deprived both of the right to the
kind of hearing afforded it under the Act and of the right to
test the information received and relied on.
Held, the application is allowed. While it seems evident that
the Tribunal ascribed more weight to the question of functional
similarity than to the other characteristics in defining "like
goods", the Court is unable to say that it did not consider those
other characteristics. The Court will not interfere with a find
ing of fact of a statutorily created body with the legal au
thority and expertise to evaluate the evidence unless there was a
complete absence of evidence to support it or a wrong principle
was applied in making it. The Court is unable to say that either
of these circumstances was present. It is clear that the Tribunal
made use of confidential information, and that some of the
information obtained and relied on was in error and not cor
rected. The applicant was prevented from correcting this error
because the error was only evident upon a perusal of the
confidential material that was not disclosed to applicant's
counsel. This is a clear case of prejudice. The Tribunal did not
conduct the inquiry required by the statute since it acted on
information not disclosed to the parties with the result that the
applicant was given no opportunity to respond to that informa
tion. The Tribunal's refusal to grant the applicant the adjourn
ment asked for was an improper exercise of the Tribunal's
discretion.
Magnasonic Canada Limited v. Anti-dumping Tribunal
[1972] F.C. 1239, applied.
APPLICATION for judicial review.
COUNSEL:
D. J. M. Brown and D. L. Rogers for
applicant.
J. L. Shields for respondent.
M. Kaylor for intervenants.
SOLICITORS:
Blake, Cassels & Graydon, Toronto for
applicant.
Soloway, Wright, Houston, Greenberg,
O'Grady & Morin, Ottawa, for respondent.
Gottlieb, Agard, Reinblatt, Dupras & Kaylor,
Montreal, for intervenants.
The following are the reasons for judgment
rendered in English by
HEALD J.: This is a section 28 application to
review and set aside a decision of the respondent
dated December 31, 1976 in which it found that
the dumping into Canada of steam traps, pipeline
strainers, automatic drain traps for compressed air
service, thermostatic air vents and air eliminators
including parts, screens and repair kits pertaining
thereto, produced by or on behalf of Sarco Com
pany Inc., of Allentown, Pa. (one of the interve-
nants herein), had not caused, was not causing, nor
was likely to cause material injury to the produc
tion in Canada of like goods.
The applicant's first allegation of error in law
and in jurisdiction is that the respondent, in its
determination of the question of "like goods" as
used in the Anti-dumping Act, R.S.C. 1970, c.
A-15', incorrectly construed that term. The mean
ing to be ascribed to that term is central to the
decision here because of its use in section 16(1) of
the Anti-dumping Act, the section which author
izes and requires a decision of the respondent in
the circumstances of this case 2 . The applicant
points to a particular passage in the reasons of the
respondent which reads as follows 3 :
' 2. (1) In this Act,
"like goods" in relation to any goods means
(a) goods that are identical in all respects to the said
goods, or
(b) in the absence of any goods described in paragraph
(a), goods the characteristics of which closely resemble
those of the said goods;
2 16. (1) The Tribunal, forthwith upon receipt by the Secre
tary under subsection 14(2) of a notice of a preliminary
determination of dumping, shall, in respect of the goods to
which the preliminary determination of dumping applies, make
inquiry as to whether
(a) the dumping of the goods that are the subject of the
inquiry
(i) has caused, is causing or is likely to cause material
injury to the production in Canada of like goods,
(ii) has materially retarded or is materially retarding the
establishment of the production in Canada of like goods, or
(iii) would have caused material injury to the production
in Canada of like goods except for the fact that provisional
duty was applied in respect of the goods; or
(b) in the case of any goods to which the preliminary
determination of dumping applies,
(i) either
(A) there has occurred a considerable importation of
like goods that were dumped, which dumping has caused
material injury to the production in Canada of like
goods or would have caused material injury to such
production except for the application of anti-dumping
measures, or
(B) the importer of the goods was or should have been
aware that the exporter was practising dumping and
that such dumping would cause material injury to the
production in Canada of like goods, and
(ii) material injury has been caused to the production in
Canada of like goods by reason of the fact that the entered
goods constitute a massive importation or form part of a
series of importations into Canada of dumped goods that
in the aggregate are massive and that have occurred within
a relatively short period of time, and in order to prevent
the recurrence of such material injury, it appears necessary
to the Tribunal that duty be assessed on the entered goods.
3 Case, Vol. 3A, p. 34.
It appears to the Tribunal that the question of whether goods
are "like" is to be determined by market considerations. Do
they compete directly with one another? Are the same consum
ers being sought? Do they have the same end-use functionally?
Do they fulfill the same need? Can they be substituted one for
the other?
and submits that this passage constitutes the
Tribunal's definition of "like goods". The appli
cant says that in respect of some of the "goods"
here involved, only those produced by the appli
cant were identical to those of Sarco Company
Inc. As to most of the other goods, the applicant
asserts that only its products had the following
characteristics in common with or identical to the
goods dumped by Sarco Company Inc.:
(i) the trade name "Sarco";
(ii) shape of components;
(iii) outward appearance; and
(iv) the high degree of correspondence in cata
logue identification.
The applicant further submits that none of the
goods produced in Canada by the other manufac
turers identified by the respondent had any of the
characteristics detailed above in common with the
dumped goods and that the only element in
common was that such goods competed with or
could be substituted for those of Sarco Company
Inc., and that none of those goods produced by
others than the applicant were "identical" to or
had characteristics which "closely resembled"
those of the dumped goods as those terms are used
in section 2(1) of the Anti-dumping Act. Thus,
according to the applicant, because of its error
described supra in defining "like goods", the
respondent did not inquire as to material injury to
the production in Canada of "like goods" but
rather inquired in respect of all goods which were
"substituted" for the dumped goods. Accordingly,
this fundamental error, in the submission of the
applicant, caused the respondent to lose or exceed
its jurisdiction.
In my view, the pertinent portions of the
respondent's reasons dealing with this issue read as
follows (Case, Vol. 3A, page 32):
There is no doubt that the goods manufactured by the
complainant, Sarco Canada, most closely resemble in their
physical appearance the goods produced by or on behalf of
Sarco U.S. The reason for this lies in the historical association
between the two companies, and their common use of the trade
name "Sarco" which their goods carry to this day.
and again at pages 33 and 34:
The reality then is that the complaint of dumping was lodged
by a Canadian producer who manufactures goods which closely
resemble in physical appearance the goods produced by or on
behalf of Sarco U.S.
In this context, are the like goods produced in Canada to be
limited to those produced by Sarco Canada? The answer to this
question is critical. If it is so limited, then, unquestionably, for
the purposes of determining the question of whether material
injury has been, is being or is likely to be caused to Canadian
production of like goods, Sarco Canada is to be accepted as the
"industry" without regard to the existence of other Canadian
producers of the goods listed in the preliminary determination
or to the presence in the Canadian market of undumped
products from the United States of the same description.
Sarco Canada admitted throughout the proceedings that
there are products produced by other Canadian producers and
products imported from other American manufacturers that
are functionally similar to the products of Sarco U.S. Thus, as
to thermostatic steam traps, its principal witness stated: "Other
manufacturers make thermostatic steam traps to their own
design which compete in some of the same markets as do Sarco
U.S. and Sarco Canada but they do not closely resemble
"Sarco" thermostatic steam traps". With respect to inverted
bucket steam traps: "The largest other inverted bucket steam
trap is Armstrong. They have a number of bucket traps which
are functionally similar to those produced by Sarco U.S. and a
number which are not. The Armstrong bucket steam trap,
however, does not closely resemble the Sarco U.S.-Sarco
Canada bucket steam traps". And as to float and thermostatic
steam traps: "Those produced by Trane (in Canada) and those
produced in the U.S. by Hoffman, Dunham, Armstrong, etc.,
while functionally similar, do not closely resemble Sarco float
thermostatic traps". And so on for item after item, except for
strainers.
The position taken by counsel. for Sarco Canada is that
functional similarity is to be disregarded in circumstances such
as those which prevail here, and the Tribunal should seek the
narrowest class•of goods which are "like", namely, those which
most closely resemble the dumped imports, i.e., those goods
which are produced by Sarco Canada.
The problem is not without difficulty, but on consideration
the Tribunal has reached the conclusion that it must reject the
narrow approach to the interpretation of the section of the Act
under study. It appears to the Tribunal that the question of
whether goods are "like" is to be determined by market con
siderations. Do they compete directly with one another? Are
the same consumers being sought? Do they have the same
end-use functionally? Do they fulfill the same need? Can they
be substituted one for the other? While in some cases, dis
similarity in the physical appearance of goods, which are
functionally alike, can be such as to create entirely different
markets; that is not the case here. It is also to be remembered
that all these competitive products must conform to certain
specified standards.
•
The Tribunal concludes that the "like goods" being produced
in Canada (in relation to which material injury is to be
examined) must encompass the collective production of all
Canadian producers of the goods listed in the Deputy Minis
ter's preliminary determination.
Pursuant to section 14(1) of the Anti-dumping
Act, the Deputy Minister made a preliminary
determination of dumping in respect of a class of
goods which are described in a general way in the
trade as "steam specialties" and sub-classes there
of such as, for example "steam traps". This Court
has held that the Deputy Minister is entitled to
formulate the class and what is included there-
under for investigation under section 13(1) of the
Act 4 and for a preliminary determination of
dumping under section 14(1) of the Act 5 .
' Sections 13(1) and 14(1) of the Anti-dumping Act read as
follows:
13. (1) The Deputy Minister shall forthwith cause an inves
tigation to be initiated respecting the dumping of any goods, on
his own initiative or on receipt of a complaint in writing by or
on behalf of producers in Canada of like goods, if
(a) he is of the opinion that there is evidence that the goods
have been or are being dumped; and
(b) either
(i) he is of the opinion that there is evidence, or
(ii) the Tribunal advises that it is of the opinion that there
is evidence,
that the dumping referred to in paragraph (a) has caused, is
causing or is likely to cause material injury to the production
in Canada of like goods or has materially retarded or is
materially retarding the establishment of the production in
Canada of like goods.
14. (1) Where an investigation respecting the dumping of
any goods has not been terminated under subsection 13(6) and
the Deputy Minister, as a result of the investigation, is satisfied
that
(a) the goods have been or are being dumped, and
(b) the margin of dumping of the dumped goods and the
actual or potential volume thereof is not negligible,
he shall make a preliminary determination of dumping specify
ing the goods or description of goods to which such determina
tion applies.
5 Compare: Mitsui and Co. Limited v. Buchanan [1972] F.C.
944.
Thus, when one considers section 16(1) in the
light of sections 13 and 14 (supra), the reference
in section 16(1) to "the goods in connection with
which a preliminary determination has been
made" and to "the production in Canada of like
goods" makes it clear, in my view, that the
respondent has jurisdiction to determine the rela
tionship between all of the goods which have been
preliminarily found to have been dumped, and
material injury, if any, caused to producers in
Canada of "like goods". Referring then to the
definition of "like goods" as contained in section
2(1) of the Act, the respondent found as a fact
that the applicant's goods were not "identical in all
respects" to those of the exporter and this finding
of fact is supported by the evidence and is not
challenged by the applicant. Thus, since the
requirements of section 2(1)(a) have not been met
on the facts here present, it is necessary to refer to
section 2(1)(b) and to consider the production in
Canada of "goods the characteristics of which
closely resemble" those found to have been
dumped.
In my view, in defining "like goods" the
respondent was required to consider all of the
characteristics or qualities of the goods, and not
restrict itself to a consideration of something less
than the totality of those characteristics. Accord
ingly, if the record disclosed that the Tribunal had
restricted itself to "market considerations" in
defining "like goods", I would agree with counsel
for the applicant that the Tribunal had erred in
law. However, my perusal of the record does not
impel me to such a conclusion. Initially, it should
be noted that, on page 34 of its reasons (supra),
the Tribunal does not state that the question of
"like goods" is to be determined solely by market
considerations. Additionally, it appears that there
was evidence before the Tribunal as to physical
similarity between the dumped goods and the
goods of some Canadian manufacturers on the one
hand (see Transcript of Public Hearing, Vol. 1, pp.
219, 229, 230, 200, 29) and further evidence as to
some physical dissimilarities between the dumped
goods and the goods of the applicant (see Tran
script, Vol. 1, pp. 229, 199-200, 201) on the other
hand. Furthermore, it appears particularly from
page 33 of the Tribunal's reasons (supra), that it
did give at least some consideration to the physical
dissimilarities between the dumped goods and the
goods of Canadian producers. It also appears that
the Tribunal did consider the physical characteris
tics of the goods. I say this because of the follow
ing passage appearing on page 32 of the reasons:
There is no doubt that the goods manufactured by the
complainant, Sarco Canada, most closely resemble in their
physical appearance the goods produced by or on behalf of
Sarco U.S. [Emphasis added.]
Thus, while it seems evident that the Tribunal
ascribed more weight to the question of functional
similarity than to the other characteristics in
defining "like goods", I am not able to say that it
did not consider those other characteristics.
A determination such as this is one of fact by a
statutorily created body having the legal au
thority and expertise necessary to evaluate the
evidence and to make such a finding. In these
circumstances, the Court will not interfere with
such a finding unless there was a complete absence
of evidence to support it or a wrong principle was
applied in making it 6 . In the case at bar, I am
unable to say that either of these circumstances
was present.
Accordingly, and for the foregoing reasons, I
have concluded that the applicant has not estab
lished error in law and in jurisdiction in respect of
its first allegation.
The applicant's second submission of error as to
jurisdiction is to the effect that the respondent
failed to properly conduct the inquiry which is a
condition precedent to its finding and that it acted
beyond its jurisdiction in that it received and
considered material obtained by it in a manner not
contemplated by the Anti-dumping Act which ma
terial, was built into the record in such a manner
that the applicant was deprived of the right to the
kind of hearing afforded to it under the statute and
was deprived of its right to test that information so
received and relied on by the respondent through
its refusal to grant the applicant's request for an
adjournment for that purpose and says further,
that by failing to disclose to the applicant a portion
6 Compare: In re Y.K.K. Zipper Co. of Canada Ltd. [1975]
F.C. 68 at 75 per Urie J.
of the material relied on by it, the respondent
violated the audi alteram partem principle.
It is necessary, for a proper consideration of this
submission, to refer to the facts surrounding the
conduct of the inquiry. The Tribunal conducted its
inquiry on November 15 to 19 inclusive, 1976.
However, prior thereto, on November 10, 1976 it
convened a hearing (referred to in the material as
a preliminary sitting) at which the three members
of the Tribunal were present along with counsel
and other representatives of the interested parties.
The purpose of this preliminary sitting, as stated
by the Chairman, was as follows:
... to make available information to both parties, to decide on
confidentiality, to outline some of the key issues and identify
some problem areas and also to inform you on the procedures
that we will follow at the public hearing 7 .
Thereupon the Chairman called upon the Secre
tary of the Tribunal to file a number of exhibits.
Twelve exhibits in all were filed, of which Exhibits
ADT-2, ADT-4, ADT-6, ADT-8 and ADT-10
were designated as confidential exhibits, the
remainder being designated as public exhibits.
Confidential Exhibit ADT-2 contained certain
attachments to a letter from the Deputy Minister
to the Secretary of the Tribunal dated October 5,
1976. These attachments were a summary relating
to the dumped goods. In respect of the other
exhibits, the Chairman had this to say:
Now, to date, the Tribunal has sent questionnaires to
Canadian manufacturers, importers of the dumped goods, and
importers of pipeline steam controls from other United States
exporters. Mr. Mahli, of our research staff, visited a number of
Canadian manufacturers and importers of pipeline steam con
trols in connection with the Tribunal's questionnaire. The
Canadian manufacturers concerned were:. Yarway Canada
Limited, Guelph, Ontario; Sarco Canada Limited, Agincourt,
Ontario; Atlas Engineering and Machine Company Limited,
Toronto, Ontario; the Trane Company of Canada Limited,
Toronto, Ontario; Dunham-Bush Canada Limited, Western,
Ontario—Weston, Ontario; Braukmann Controls Company
Ltd., Weston, Ontario. The Canadian importers concerned
were: Mackinson Winchester Ltd., Montreal. In addition, the
Tribunal became aware, after having sent out questionnaires to
Canadian manufacturers and importers, that other firms were
involved in either the manufacture of pipeline steam controls or
sale of imported pipeline steam controls. The Tribunals
research staff contacted a number of firms, as will be indicated
Transcript of Public Hearing, Vol. 1, p. 1.
later, to obtain details of sales from domestic production or
imports of these goods in Canada during the years '75 and '76.
From the information obtained in reply to its questionnaires
and from a telephone survey, the Tribunal was able to prepare
two public exhibits: one which outlines the Canadian manufac
turers of the goods covered by the preliminary determination;
and second, a table outlining the total apparent Canadian
market for pipeline steam controls.
Mr. Secretary, would you file other ADT public and confi
dential exhibits, reports on briefs received, and distribute public
exhibits and briefs? 8
Confidential Exhibit ADT-4 was a collective ex
hibit containing the replies to the Tribunal's manu
facturers' questionnaire. Sub-exhibit ADT-4.1 was
the reply from Sarco Canada Limited; 4.2 was the
reply from Yarway Canada Limited; 4.3 the reply
from John W. Tucker Ltd.; 4.4 the reply from
Trane Company of Canada Limited and 4.5 was
"replies received from other manufacturers who do
not manufacture, have no significant production of
subject goods, or were unable to provide
information." 9
Confidential Exhibit ADT-6 was a collective
exhibit containing the replies to the Tribunal's
importer questionnaire. Sub-exhibit ADT-6.1 was
the reply from Escodyne Limited; 6.2 the reply
from Makinson Winchester; 6.3 the reply from
J.R. Stevenson Limited and 6.4 the reply from
Warco Specialties Inc.
Confidential Exhibit ADT-8 is a summary of
the information received from some five Canadian
manufacturers who had been contacted by the
Tribunal's research staff by telephone or letter for
information concerning production and sales. In
addition to information from the Canadian manu
facturers, this exhibit also contains information
from Velan Engineering Company. The actual
documents and letters received are attached as a
part of Exhibit ADT-8.
Confidential Exhibit ADT-10 is a summary of
the information received from some twenty-one
8 Transcript, Vol. 1, pp. 2-3.
9 Transcript, Vol. 1, p. 4.
Canadian importers together with supporting
material.
As a result of the undertakings of confidentiality
by counsel, applicant's counsel had made available
to him certain of the confidential exhibits. How
ever, the remainder of the confidential exhibits
were not made available. The Tribunal Chair-
man's ruling in this connection reads as follows:
Now, the remainder of the confidential information provided to
the Tribunal will have to be confidential to the Tribunal only.
It's replies from other companies .... 10
The material which was not disclosed may be
detailed as follows:
(a) Exhibit ADT-2;
(b) Exhibit ADT-4.2 and 4.4 and 4.5;
(c) Exhibit ADT-8 together with the attached documents
and letters in support thereof; and
(d) Exhibit ADT-10 together with the supporting material.
The basis for such non-disclosure was said by the
Tribunal to be section 29(3) of the Anti-dumping
Act which reads as follows:
29. ...
(3) Where evidence or information that is in its nature
confidential, relating to the business or affairs of any person,
firm or corporation, is given or elicited in the course of any
inquiry under section 16, the evidence or information shall not
be made public in such a manner as to be available for the use
of any business competitor or rival of the person, firm or
corporation.
The transcript of the preliminary sitting then
reveals that counsel for Sarco Company Inc., one
of the intervenants herein asked for disclosure of
the questionnaires from other companies as well as
disclosure in respect of Exhibit ADT-2. Then at
this point, Mr. Brown, counsel for the applicant
addressed the Tribunal as follows 11:
MR. BROWN: Yes, Mr. Chairman, we had some questions
relating to the public information and—and from our own
intelligence had come to a conclusion that Canadian manu—
other Canadian manufacturers weren't as significant as they
appear to be from the public exhibit showing the the (sic)
Canadian market. The imports don't—don't surprise us par
ticularly, but the Canadian manufacturers do and we have
some questions in our mind as to whether or not the products
might properly—you know, the kind of numbers might properly
have been included, and also whether the market, as it is
10 Transcript, Vol. 1, pp. 6-7.
11 Transcript, Vol. 1, pp. 8-12.
lumped together, perhaps, ought to be segregated a bit as to
some of the products, traps and strainers, etc. And also from
the—we made a casual contact with a couple of Canadian
manufacturers prior to this matter being instituted and they
sort of didn't—they want to stay away from an involvement.
But we feel that perhaps we ought to attempt to contact some
of them ourselves and at least satisfy ourselves as to their will—
unwillingness to participate or perhaps satisfy ourselves as to
whether we ought to subpeona (sic) them. And this is leading
me to a concern that with the time between now and Monday,
that we may—we really can't cope with that—the problem.
One of the manufacturers, we noticed has—we'd not heard of
and—which I find a little strange at the moment—and they're
in Quebec and I think we're—we find ourselves in the position
of requiring an adjourment (sic), almost, to just see whether we
can't, behind the scenes ourselves, get behind the Canadian
manufacturer a little bit and get a better feel for it.
Obviously, Sarco Canada is the—the major manufacturer
across the board but some of the others may be more signifi
cant in some of the products that we had originally thought,
and if we can't persuade them to participate on their—on their
own, we may seek to subpoena them and—but before we do
that, I think we ought to have a chance to talk to them.
THE CHAIRMAN: And you don't think it's possible for you to
do this before Monday?
MR. BROWN: Tomorrow or Friday? Yes, that's my problem.
MR. CHAIRMAN: But the Tribunal has a problem in that
probably the calendar of the Tribunal has never been as heavy
as it is now, and I don't think we can consider an adjournment.
We—we have to render a decision ... .
MR. BROWN: In 90 days.
THE CHAIRMAN:... in 90 days and next week we start on—
the week after next we start on something else.
MR. BROWN: Yes, I appreciate that, Mr. Chairman.
MR. CHAIRMAN: In terms of the information that has been
submitted to you, our research staff, I think, was very careful
to—to try and ascertain that they were like goods. Maybe Mr.
Armstrong could discuss with Mr. Mahli some of the things
included after?
MR. BROWN: Well, I think we—we—yes, but I really think
we ought to be—ought to have an opportunity to speak to other
manufacturers and ascertain what their view is and what their
position is. I take it that the 90 days runs from October the
4th?
MR. CHAIRMAN: Yes.
MR. BROWN: That's really October, November, December,
we're really speaking in terms of the first of the year as being
your maximum possible time.
MR. CHAIRMAN: Yes.
MR. BROWN: Do you not have any time in early December?
MR. CHAIRMAN: No.
MR. BROWN: No.
MR. CHAIRMAN: There's no time in early December.
There—there's hardly any time from now until the end of the
year. Mr. Secretary, do you think there's a—there is a
possibility?
THE SECRETARY: No, Mr. Chairman. After next week—
after next week, hearings are scheduled at this stage until
mid-December.
MR. BROWN: So that the last—the only possible would be
that third week in December?
MR. CHAIRMAN: Oh, and—and—and that is impossible. We
could not render the decision before—in the prescribed period.
MR. BROWN: Well, ... .
THE CHAIRMAN: Still—you still have two and a half days.
MR. BROWN: Well, ... .
THE CHAIRMAN: I realize it's not very much and ... .
MR. BROWN:... I also have another case on Friday, you
know. You know, two and a half days really—I suppose
everybody who's practicing law has the same problem. I get
calendars that are filled as well.
MR. LAVIGNE: But why hasn't your client been inquiring of
the Canadian manufacturers before this?
MR. BROWN: Well, we have. We have, There were a couple
of manufacturers we hadn't heard of.
MR. LAVIGNE: Well, it's not unusual. We find that in every
case both parties learn an awful lot about the market and other
manufacturers. You know, but ....
MR. BROWN: Yes.....
MR. LAVIGNE:... there's been ample time to make a—make
contacts and seek support and all this sort of thing.
MR. BROWN: Well, that's true, although the information we
were given from the manufacturers we contacted were—was:
we're nothing, we're not really—you know, we're so insignifi
cant that we don't care. And a couple of Quebec companies
that have been revealed on the—on the face of the information,
were new to us, a surprise to us, and I guess the first question to
them would be, how significant are you and if you are signifi
cant would you participate as a witness? And it really—two
days is just not adequate to be making those contacts.
THE CHAIRMAN: Well, it's unfortunate in this case, but we—
we definitely cannot postpone this—this hearing.
Now, Mr. Brown, I'm informed by the Director of Research
that we've tried to get a lot of these people to participate
without any success. It was even difficult to get statistical
information from them.
MR. BROWN: Well, I have—I suppose I have my—one
slighter advantage that if they'll at least talk to me, I can
subpoeona (sic) them.
THE CHAIRMAN: Yes.
MR. BROWN: Even the mechanics of have subpoeonas (sic)
served between—between now and Friday, for next Monday, is
almost too much. You can appreciate that. I don't know that
the Board—I guess, technically, you may well have the power
to act....
THE CHAIRMAN: We do.
MR. BROWN:... in your own initiative that way.
THE CHAIRMAN: We do.
MR. BROWN: By subpoeona, (sic) but it—by and large,
you've left it to the parties in the past.
THE CHAIRMAN: As far as the Tribunal was concerned, we
didn't feel that we needed that. We have information from
them, which, of course is not available to you. That's—that's
regrettable, but we will use that—that information and make
our decision. [Emphasis added.]
Counsel for the applicant details in his memoran
dum the prejudice to his client by this refusal to
provide him with the balance of the confidential
material as follows ' 2 :
36. In the instant case the Tribunal received and relied upon
confidential responses to questionnaires, confidential informa
tion from the Deputy Minister and data gathered by its
research staff through personal attendances on and telephone
communications with a number of firms identified as manufac
turers or importers of goods said to be like to those to which the
Preliminary Determination of Dumping applied. Counsel for
the Applicant was not given an opportunity to examine all of
the material considered by the Tribunal or the staff member
who received information by telephone and submitted summar
ies thereof to the Tribunal.
37. It is submitted that the Tribunal erred in finding that there
were, in addition to the Applicant, eight other Canadian pro
ducers of like goods as identified by the Tribunal in its State
ment of Reasons. Material before the Tribunal disclosed that;
John Wood Co. Limited did not manufacture goods of the type
under consideration; Atlas Engineering and Machine Company
Limited and Braukmann Controls Company Ltd. were unable
to supply information; Dunham Bush Canada Limited had no
significant production of the subject goods; and John W.
Tucker Limited no longer produced any goods which were like
goods to the goods produced by or on behalf of Sarco Co. Inc.
to which the Preliminary Determination of Dumping applied.
Exhibit ADT-3—Record, Vol. 3A, p, 57
Transcript of Hearing—Record, Vol. 1, pp. 156-158
38. It is submitted that there was evidence before the Tribunal
which indicated that the quantitative definition of the Canadi-
an market represented by Exhibit ADT-12 was inaccurate and
that, therefore, the decision of the Tribunal was based on an
12 Applicant's memorandum of fact and law, pp. 14 and 15.
erroneous finding of fact or on facts for which there was no
evidence properly before the Tribunal. Exhibit ADT-12 was not
revised to reflect a change in the material before the Tribunal
concerning sales in Canada by Velan Engineering Company,
one of the firms identified as a Canadian producer of like
goods, or the correction of Exhibit ADT-8. It appears from the
record herein that Exhibit ADT-12 was compiled, in part, on
the basis of information reflected in Exhibits ADT-8 and
ADT-11 which identify as Canadian producers of like goods
firms other than those which the Tribunal held to be part of the
domestic industry. Insofar as Exhibit ADT-12, there is no
evidence in the record of the Tribunal's proceeding which
establishes the sales in Canada from imports of the subject
goods.
In my view, there is substance in this argument
by counsel for the applicant since it is clear from
page 12 of the transcript of the preliminary sitting
(supra) that the Tribunal intended to make use of
that confidential information and it is clear from
the reasons of the Tribunal that they did use that
information (see reasons of Tribunal, Vol. 3A, pp.
11 and 12). It is also clear that some of the
information obtained and relied on by the Tribunal
was in error and was not corrected. The applicant
was prevented from correcting this error because
the error was only evident upon a perusal of the
confidential material which was not disclosed to
applicant's counsel. This is a clear case of
prejudice.
The proper procedure to be followed by the
Tribunal in a case of this kind was set out by
Jackett C.J., in the Magnasonic case as follows 13 :
The "inquiry" in this case consisted, in part, of a public
hearing, at which Magnasonic and other parties, all of whom
were represented by counsel, adduced evidence and were given
an opportunity to make submissions with reference to the
evidence presented at such hearing. However, this hearing was
conducted on the basis that no person would be required to give
evidence against his will if he took the view that it was
"confidential". In part, the inquiry consisted in the receipt by a
member or members of the Tribunal or by the staff of the
Tribunal, otherwise than during a sittings, of confidential evi
dence requested by the Tribunal or sent to it voluntarily by the
Deputy Minister or others. Finally, the inquiry consisted in
visits paid by one or more members of the Commission or its
staff to premises of Canadian manufacturers and one or more
interviews also conducted by members or staff, during the
course of which visits and interviews evidence and information
was obtained.
The feature of this type of "inquiry" which is to be noted is
that, while the "parties" had full knowledge of the evidence
adduced at the public hearing, they had no opportunity to know
'3 Magnasonic Canada Limited v. Anti-dumping Tribunal
[1972] F.C. 1239 at 1244 to 1249 inclusive.
what other evidence and information was accepted by the
Tribunal and had no opportunity to answer it or make submis
sions with regard thereto.
In our view, leaving aside section 29(3) for the moment, all
the relevant provisions of t`,t. Anti-dumping Act point clearly
to the conclusion that this Tribunal was intended to operate,
during the inquiry into any particular matter, by way of a
quorum of members sitting together, either in camera or in
public, in the presence of such of the "parties" as chose to be
there, either personally or by their counsel or agents. In our
view, this clear requirement of the statute is subject to only one
exception, which is that contained in section 28, under which, if
the Chairman of the Tribunal so directs, a single member may
receive evidence. But, in any such case, it seems obvious, and
this is conceded by counsel for the Attorney General of
Canada, that the parties are entitled to be represented in
exactly the same way as if a quorum of members is sitting.
What is more important, where evidence is so received, is that a
report of the evidence so taken must be made to the Tribunal
and a copy of that report must be provided to "each of the
parties" and, in addition, a further hearing must be held so that
the parties can deal with the additional evidence "if in its
discretion the Tribunal deems it advisable to do so", which, it
must be assumed, the Tribunal will, in a proper exercise of its
discretion, deem it advisable to do in any case where additional
evidence of any consequence has been so received. The au
thority for sittings by one member contained in section 28, in
our view, underlines the general rule, to be deduced from the
provisions quoted above, that an inquiry must be conducted by
a quorum of members sitting in camera or in public held in
such manner as to permit the "parties" who desire to do so to
appear or to be represented.
We turn now to section 29(3) to consider whether it requires
a conclusion different from that which is dictated by the other
provisions of the statute considered apart from that subsection.
Section 29(3) must be read in context. It follows a provision
that says that "All parties" are entitled to appear in person or
to be represented "at the hearing" and a provision that says
that a hearing may at the discretion of the Tribunal or the
Chairman "be heard in camera or in public". What section
29(3) says is that "Where evidence or information that is in its
nature confidential, relating to the business or affairs of any
person, firm or corporation, is given or elicited in the course of
an inquiry ... , the evidence shall not be made public in such a
manner as to be available for the use of any business competitor
or rival ...". It seems to be common ground that this means
that, when the Tribunal accepts confidential evidence, steps
must be taken to see that it does not become available to a
business competitor or rival even if such rival or competitor is a
party to the inquiry. Accepting that as being the effect of
section 29(3) without expressing any opinion with regard there
to, we do not think that section 29(3) requires a departure from
the pattern of hearings dictated by the other provisions of the
statute. What it does require, on that view as to its meaning, is
that, when information of a confidential character is tendered
at a hearing, a decision must be made as to what steps are
required to comply with section 29(3). The obvious first step in
the ordinary case would seem to be that the evidence be taken
in camera. What further steps require to be taken would
depend on the circumstances. The most extreme step that might
be required would be, we should have thought, to exclude all
competitors or rivals while the evidence is being taken and to
provide such parties afterwards with the sort of report of the
evidence taken in their absence that is contemplated for the
parties with reference to confidential evidence taken under
section 28.
In our view of the problem raised by this application, it is not
a situation where it is necessary to consider whether a decision
of a tribunal will so affect the rights or interests of a person
that he is entitled to a fair hearing before that decision can be
made. In our view, the question here is whether there has been
a failure to comply with the statutory conditions precedent to
the decision. Compare Franklin v. Minister of Town and
Country Planning [1948] A.C. 87, per Lord Thankerton at
page 102.
The sole business entrusted to the Board is to conduct
inquiries under section 16 in respect of goods to which prelim
inary determinations of dumping apply and then to make such
orders or findings as the nature of the matters may require
(section 16(3)).
For the conduct of such inquiries, the statute has made
provision for the system of hearings to which I have referred
and has conferred on the "parties" (who must, we should have
thought, include the "importer" and other persons who have a
statutory right to notice of the preliminary determination) a
statutory right to appear at such hearings or to be represented
there. In the absence of some thing in the statute clearly
pointing to the contrary, we have no doubt that such a right
implies a right of the party to be heard, which at a minimum
includes a fair opportunity to answer anything contrary to the
party's interest and a right to make submissions with regard to
the material on which the Tribunal proposes to base its deci
sion. A right of a party to "appear" at a "hearing" would be
meaningless if the matter were not to be determined on the
basis of the "hearing" or if the party did not have the basic
right to be heard at the hearing.
Against this view, it is said that the object of the Anti-
dumping Act is "to protect the Canadian public interest from
dumped goods which may materially cause injury or retard
production in Canada of like goods" and, therefore, the inquiry
is "essentially an investigatory one and does not involve a
contest between opposing parties".
We accept it that the object of the Act is to protect the
Canadian public interest from dumped goods which may
materially cause injury or retard production in Canada and
that the inquiry is not, as such, a contest between opposing
parties. It appears clear, however, that the reason for the
existence of the Tribunal was that Parliament sought, not only
a means whereby to keep out dumped goods when their impor
tation would do injury or retard production, but also a means
whereby dumped goods would not be kept out when their
importation would not do injury or retard production (and
would, therefore, presumably provide Canadian consumers with
cheaper goods without doing any harm). Otherwise, that is, if
Parliament was not concerned about the danger of keeping out
dumped goods unnecessarily, the statute would have simply
prohibited all importations of dumped goods.
One method that Parliament could have adopted to deter
mine whether the dumping of any particular class of goods
should be prohibited would have been to entrust the duty to an
executive department of government with all necessary powers
to gather information and to proclaim its findings. There would
then have been no right in any "party" to be heard. Parliament
chose instead to set up a court of record to make the inquiries
in question and provided for such an inquiry being carried out
by hearings where those whose economic interests are most
vitally affected on both sides of the question would be entitled
to appear. It seems obvious that it was thought that the most
effective way of assuring that the right conclusion would be
reached was to open the door to such opposing parties, whose
economic interests were at stake, so that they could, by adduc
ing evidence and by making submissions, make sure that all
sides of the question were fully revealed to the Commission. We
can think of no method more likely to ensure that the Commis
sion would not go wrong for lack of information and for lack of
proper exposition of the problem. Certainly, our experience in
common law countries has shown that such method of inquiry
has substantial advantages over the sort of result that can be
obtained by individuals going out and gathering information by
interviews and inspections.
In addition, one cannot overlook the fact that Parliament saw
fit to cause the foreign government of the exporter country to
be advised at the early stages of the matter. It may be, we do
not know, that the international agreement referred to in
section 16(4) of the Anti-dumping Act made it expedient to
afford such a government an opportunity of taking part in such
an inquiry at least as an observer.
It is also said against the view that we have taken as to the
right of each of the parties to a fair opportunity to present his
side of the matter that the statute makes it clear that the
Tribunal is to pursue its own inquiries by its own staff and with
the help of government departments and agencies. We fully
accept it that the Tribunal may conduct a programme of
amassing information relevant to a matter before it. What, as it
appears to us, the statute contemplates is that such material, to
the extent that it seems useful, be built into the record of the
matter during the course of the hearings in such manner as the
Tribunal chooses provided that it is consistent with giving the
"parties" an opportunity to be heard. (One obvious way is to
have commission counsel who submits evidence and makes
submissions in the same way as counsel for a party.)
Another point that is taken against concluding that Parlia
ment intended that the parties have the right to be heard in the
ordinary way is that, if they have such a right, it will be
impossible, it is said, for the Tribunal to implement the require
ment in section 16(3) of the Act that it reach its decision within
a period of 90 days. We do not recognize the inconsistency
between the two requirements. Parliament has imposed a time-
table on the Tribunal and the Tribunal must therefore operate
on a timetable which implies a limit on the time that can be
afforded to the parties to make out their respective cases. It
does not, however, negative the requirement that they be given
an opportunity to be heard that is necessarily implied by the
other provisions of the statute.
Our conclusion is, therefore, that the Tribunal made the
decision under attack without having conducted the inquiry
required by the statute, in that it acted on information that was
not put before it in the course of hearings by the Tribunal or a
single member of the Tribunal such as were provided for by the
statute, with the result that no opportunity was given to the
parties to answer such information (either as obtained or,
where based on confidential communications, as communicated
to them in some way that complied with section 29(3)) and no
opportunity was given to the parties to make submissions with
regard thereto.
Likewise, in the case at bar, I have concluded
that the Tribunal did not conduct the inquiry
required by the statute since it acted on informa
tion not disclosed to the parties with the result that
the applicant was given nô opportunity to respond
to that information. Likewise, I am of the opinion
that in the circumstances of this case, the Tribu
nal's refusal to grant to the applicant the adjourn
ment asked for was an improper exercise of the
Tribunal's discretion.
I am not unmindful of the difficulties imposed
on the Tribunal in a case such as this involving
confidentiality in respect of at least a portion of
the material before it on the one hand and the
other requirements of the statute which necessitate
a "hearing" either in camera or in public, in the
presence of such of the interested parties as desire
to be present, on the other hand. However, the fact
that the role of the Tribunal is, because of the
provisions of the statute, difficult in some circum
stances, is not to say that the Tribunal is to be
excused, in such cases, from balancing these two
principles that is, the concepts of confidentiality
and a fair and full hearing based on full disclosure
of the case to be met. In the Magnasonic case
(supra), the Chief Justice has given at least two
examples of the way in which this seeming conflict
could be resolved by the Tribunal. The one exam
ple probably represents a minimal safeguard of
confidentiality. The other example seems to repre
sent maximum safeguards in so far as confidential
ity is concerned, with an absolute minimum so far
as full disclosure and a fair hearing is concerned.
The minimum "full disclosure and fair hearing"
safeguard referred to by the Chief Justice and
quoted supra suggests the exclusion of all competi-
tors while the confidential evidence is being taken
but would require the provision to all such parties
of a summary or report of that evidence. Yet, in
this case, even such a minimum safeguard was not
provided by the Tribunal. The Tribunal used the
confidential information not available to the appli
cant at least to some extent, as a basis for its
decision without giving the applicant any report or
summary of that evidence. Similarly, I am cogni
zant of the strictures placed upon the Tribunal by
the requirement in section 16(3) of the Act that it
reach its decision within 90 days. This requirement
does not, however, nullify the other requirements
of the statute which give the interested parties a
full and fair opportunity to be heard. Likewise, it
does not, by itself, represent a justification for
refusing to grant an adjournment to one of the
parties, in the presence of other circumstances
which, but for the time limitation, would likely
have resulted in the Tribunal granting the adjourn
ment requested.
A perusal of this transcript satisfies me that this
applicant's request for adjournment was entirely
justified, given the substantial nature of the evi
dence first disclosed to it on November 10 and the
fact that a substantial amount of other evidence
was not going to be disclosed to it. I am also
satisfied, from the transcript, that the Tribunal
was sympathetic to the request, considered it
reasonable in the circumstances, and but for the
time constraints referred to, would have granted
the adjournment.
Accordingly, it is my opinion that the appli
cant's second ground of attack on the Tribunal's
decision is well-founded. I would therefore allow
the section 28 application, set aside the decision of
the respondent dated December 31, 1976 and refer
the matter back to the Tribunal for a re-hearing in
a manner not inconsistent with these reasons.
* * *
LE DAIN J.: I agree.
* * *
MACKAY D.J.: I agree.
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.