T-1983-87
Yri-York Limited, Norman B. Katzman, L. F.
Newbery, John M. White, Leon Robidoux, Pitt
Steel Limited, James Arthur Jobin, Lorne Gilbert
Coons, Bruce Scott Moore, William Alexander
Mowat, Newman Steel Ltd., Peter R. Sheppard,
Zenon P. Zarcz, Namasco Limited, Charles Ian
McKay, P. J. Peckham, Westeel-Rosco Limited,
Marshall Steel Limited, AMCA International
Limited, J. B. Phelan, Samuel Son & Co. Limited,
W. Grant Brayley and Harold Irvine (Applicants)
v.
Attorney General of Canada, Restrictive Trade
Practices Commission, Director of Investigation
and Research appointed under the Combines
Investigation Act and J. H. Cleveland (Respond-
ents)
INDEXED AS: YRt YORK LTD. V. CANADA (ATTORNEY
GENERAL)
Trial Division, McNair J.—Ottawa, October 7
and November 5, 1987.
Judicial review — Prerogative writs — Prohibition
Application to stay Restrictive Trade Practices Commission
inquiry until Supreme Court of Canada ruling on constitution
al validity of Combines Investigation Act, s. 17, pursuant to
which inquiry commenced — Tripartite test in American
Cyanamid not applicable — Civil action inter partes (Ameri-
can Cyanamid) to be distinguished from action to prevent
administrative tribunal from exercising statutory authority —
Judicial interference justified only in special circumstances,
and where serious, irreversible consequences if proceedings not
stayed — American Cyanamid test not applicable in perma
nent injunction proceedings Argument that irreparable
harm if compelled to testify premature Statutory protection
against use of testimony in criminal trial — Individual rights
must be balanced against society's right to production of
evidence.
Constitutional law — Charter of Rights — Life, liberty and
security — Whether Combines Investigation Act, s. 17 void as
contrary to Charter, ss. 7 and 8 No absolute privilege of
witness except as defined by statute — Restricted Trade
Practices Commission inquiry administrative procedure deter
mining neither rights nor imposing liabilities — Protection
against self-incrimination not required.
Combines — Inquiry before Restrictive Trade Practices
Commission pursuant to Combines Investigation Act, s. 17
Application for prohibition to stay inquiry until constitutional
validity of s. 17 decided, in other litigation, by Supreme Court
of Canada — Tripartite test in American Cyanamid not
applicable to s. 18 attack on exercise of statutory authority by
administrative tribunal — Argument that irreparable harm if
forced to testify premature — Consideration of public interest
— S. 17 orders for attendance of witnesses not contrary to
Charter, s. 7 as nature of proceedings not requiring protection
from .self-incrimination.
This is an application for prohibition to stay an inquiry
before the Restrictive Trade Practices Commission instituted
pursuant to section 17 of the Combines Investigation Act, until
the Supreme Court of Canada has decided, in other litigation,
whether that section is void as contrary to sections 7 and 8 of
the Charter. The applicants relied on Manitoba (Attorney
General) v. Metropolitan Stores for the proposition that the
same principles apply to the decision of whether to grant a stay
of proceedings as apply to granting an interlocutory injunction.
The three tests set out therein were: I) a preliminary and
tentative assessment of the merits; 2) whether the litigant
would suffer irreparable harm not compensable in damages; 3)
balance of convenience. The applicants argued that they would
suffer irreparable harm not compensable in damages if they
were compelled to testify at the inquiry. They alleged that their
testimony could lead to criminal prosecution, and that any
protection afforded by sections 7 and 8 of the Charter would be
forever lost. They also submitted that the balance of conve
nience, viewed from a public interest perspective, weighed in
their favour in terms of their Charter rights, and that the public
interest would not be harmed if the inquiry was postponed, as it
had already been adjourned on consent for some six years.
The respondents argued that the relief sought was not inter
locutory and therefore the principles applicable to the granting
of an interlocutory injunction or stay of proceedings did not
apply. Also, the orders compelling attendance were allegedly in
the nature of subpoenas ad testificandum, the making of which
simply constitutes the exercise of a non-reviewable administra
tive function.
Held, the motion should be dismissed.
The tripartite test in American Cyanamid to determine
whether an interlocutory injunction or stay of proceedings
should issue does not apply to an attack, under section 18 of the
Federal Court Act, on the exercise of statutory authority by an
administrative tribunal. The Nova Scotia Court of Appeal in
McFetridge v. Nova Scotia Barristers' Society, distinguished
cases involving an ordinary civil action inter partes to restrain
some injury, such as breach of patent, from actions to prevent a
statutory tribunal from exercising its powers and duties. It was
there said that a court should not interfere by interim injunc
tion or stay except in very special circumstances, e.g. to obtain
time for the court to adjudicate the issue, and where the
consequences of not staying the proceedings would be serious
and irreversible. Upon a section 18 application for a permanent
injunction, the Federal Court of Appeal has refused to apply
the American Cyanamid serious question test used in interlocu
tory injunction matters. As to the question of irreparable harm,
the Federal Court of Appeal in Ziegler held that section 17 did
not infringe section 8 of the Charter and that there was in
Canada no absolute privilege of a witness except as defined by
statute.
The rights to life, liberty and security of the person enshrined
in section 7 of the Charter must be balanced against the
corresponding rights of others and the collective right of society
generally. The Charter deliberately draws a line between
non-compellability and statutory protection against the use of
incriminating evidence in the case of a witness. The purpose is
not to incriminate the witness, but to produce evidence which
must be given if the public interest is to be served.
The orders issued under subsection 17(1) of the Combines
Investigation Act for the attendance of witnesses did not con
travene section 7 of the Charter. Section 17 proceedings are not
of a nature to require protection against self-incrimination.
They neither determine rights nor impose liabilities. The wit
nesses are fully protected against the subsequent use of any
incriminating answers by the Canada Evidence Act, Combines
Investigation Act and the Charter.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
Canada Evidence Act, R.S.C. 1970, c. E-10, s. 5.
Canadian Bill of Rights, R.S.C. 1970, Appendix III,
s. 2(d).
Canadian Charter of Rights and Freedoms, being Part I
of the Constitution Act, 1982, Schedule B, Canada
Act 1982, 1982, c. 11 (U.K.), ss. 2, 7, 8.
Combines Investigation Act, R.S.C. 1970, c. C-23, ss. 17,
18 (as am. by S.C. 1974-75-76, c. 76, s. 6), 20 (as am.
idem, s. 8), 32 (as am. idem, s. 14).
Competition Act, R.S.C. 1970, c. C-23 (as am. by S.C.
1986, c. 26, s. 19).
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 18.
Labour Relations Act, C.C.S.M., c. L10.
U.S. Constitution., Amend. V.
CASES JUDICIALLY CONSIDERED
APPLIED:
Irvine v. Canada (Restrictive Trade Practices Commis
sion), [1987] 1 S.C.R. 181; Stelco Inc. v. Canada (Attor-
ney General), [1988] 1 F.C. 510 (T.D.); Manitoba
(Attorney General) v. Metropolitan Stores Ltd., [1987] 1
S.C.R. 110; McFetridge v. Nova Scotia Barristers'
Society (1981), 123 D.L.R. (3d) 475 (N.S.S.C.); Lodge
v. Minister of Employment and Immigration, [1979] 1
F.C. 775 (C.A.).
DISTINGUISHED:
Canada (Procureur Général) c. Alex Couture Inc., [1987]
R.J.Q. 1971 (C.A.); American Cyanamid Co. v. Ethicon
Ltd., [1975] A.C. 396 (H.L.).
CONSIDERED:
Thomson Newspapers Ltd. et al. v. Director of Investiga
tion & Research et al. (1986), 57 O.R. (2d) 257 (C.A.);
leave to appeal granted [1987] 1 S.C.R. xiv; Samuel, Son
& Co., Ltd. v. Canada (Restrictive Trade Practices Com
mission), [1988] 2 F.C. 523 (T.D.); Law Society of
Alberta v. Black et al. (1983), 8 D.L.R. (4th) 346 (Alta.
C.A.); Ziegler v. Hunter, [1984] 2 F.C. 608; (1983), 8
D.L.R. (4th) 648 (C.A.).
REFERRED TO:
Gould v. Attorney General of Canada et al., [1984] 2
S.C.R. 124; affg. [1984] 1 F.C. 1133 (C.A.); Operation
Dismantle Inc. et al. v. The Queen et al., [1985] I S.C.R.
441; 18 D.L.R. (4th) 481; Re Federal Republic of Ger-
many and Rauca (1983), 41 O.R. (2d) 225; 145 D.L.R.
(3d) 638 (Ont. C.A.); Haywood Securities Inc. v. Inter-
Tech Resource Group Inc. (1985), 24 D.L.R. (4th) 724
(B.C.C.A.).
COUNSEL:
F. J. C. Newbould, Q.C. and D. A. Lang for
Yri-York Limited, Norman B. Katzman, L.
F. Newbery, John M. White and Leon
Robidoux.
Valerie Dyer for Harold Irvine.
N. Finkelstein for Westeel-Rosco Limited.
Peter R. Jervis for Marshall Steel Limited,
James Arthur Jobin, Lorne Gilbert Coons,
Bruce Scott Moore and William Alexander
Mowat.
James A. Robb, Q.C. for J. B. Phelan and
AMCA International Limited.
W. J. Miller and C. Tacit for Samuel, Son &
Co. Limited and W. Grant Brayley.
T. B. O. McKeag, Q.C. for Namasco Limited,
Charles Ian McKay and P.J. Peckham.
Peter A. Vita, Q.C. and André Brantz for
respondents.
SOLICITORS:
Tilley, Carson & Findlay, Toronto, for Yri-
York Limited, Norman B Katzman, L. F.
Newbery, John M. White and Leon Robi-
doux.
Osier, Hoskin & Harcourt, Toronto, for
Harold Irvine.
Blake, Cassels & Graydon, Toronto, for Wes-
teel-Rosco Limited.
Stikeman, Elliott, Toronto, for Marshall
Steel, James Arthur Jobin, Lorne Gilbert
Coons, Bruce Scott Moore and William Alex-
ander Mowat.
Stikeman, Elliott, Montréal, for J. B. Phelan
and AMCA International Limited.
Smith, Lyons, Torrance, Stevenson & Mayer,
Ottawa, for Samuel, Son & Co. Limited and
W. Grant Brayley.
Campbell, Godfrey and Lewtas, Toronto, for
Namasco Limited, Charles Ian McKay and
P.J. Peckham.
Deputy Attorney General of Canada for
respondents.
EDITOR'S NOTE
This decision has been reversed by the Federal
Court of Appeal—Court file A-1118-87, judgment
rendered January 19, 1988. The Court of Appeal
(Heald J. with Stone and MacGuigan JJ. concur
ring) concluded that the Motions Judge erred in
failing to apply the test in American Cyanamid as
approved by the Supreme Court of Canada in
Manitoba ( Attorney General) v. Metropolitan
Stores Ltd., [1987] 1 S.C.R. 110. The Court of
Appeal did not find persuasive the case of McFe-
tridge v. Nova Scotia Barristers' Society (1981),
123 D.L.R. (3d) 475, (N.S.S.C.), relied upon by
McNair J., which was to the effect that the Ameri-
can Cyanamid test has little relevancy where a
declaration and permanent injunction are sought
to prevent a tribunal from exercising its prima
facie statutory powers. The circumstances of this
case called for fashioning a remedy possessing
the Charter's innovative and evolutive character
istics. The reasons for judgment of the Federal
Court of Appeal will be published in the Canada
Federal Court Reports.
The following are the reasons for order ren
dered in English by
McNAIR J.: The case before me is an applica
tion under section 18 of the Federal Court Act
[R.S.C. 1970 (2nd Supp.), c. 10] for an order by
way of prohibition to stay inquiry proceedings
pending before the Restrictive Trade Practices
Commission (RTPC), pursuant to section 17 of
the Combines Investigation Act, R.S.C. 1970, c.
C-23 (as amended by S.C. 1974-75-76, c. 76),
until the Supreme Court of Canada has rendered a
decision in the appeal of Thomson Newspapers
Ltd. et al. v. Director of Investigation & Research
et al. [(1986), 57 O.R. (2d) 257 (C.A.)]. Leave to
appeal the Thomson case was granted on June 25,
1987 [[1987] 1 S.C.R. xiv].
On September 28, 1987 the Supreme Court of
Canada stated the following question to be
resolved on the appeal:
Is section 17 of the Combines Investigation Act inconsistent
with the provisions of section 7 and 8 of the Canadian Charter
of Rights and Freedoms and therefore of no force and effect?
The motion also sought an order of certiorari
quashing all orders heretofore made in relation to
the section 17 inquiry and any notices of hearing
in respect thereof, and also an order of prohibition
restraining the Commission and the hearing officer
from proceeding with the hearings contemplated
by the aforementioned orders and notices. The
whole thrust of the case, if I apprehend the matter
correctly, is directed to enjoining the RTPC from
proceeding with the present inquiry until the
Supreme Court has answered the constitutional
question posed in Thomson. The ancillary relief of
certiorari and prohibition in the strict sense were
stood in abeyance by agreement of counsel.
The facts are relatively undisputed. The appli
cants are all corporations or individuals who have
received various notices or orders under the Com
bines Investigation Act ("CIA") with respect to an
investigation being conducted by the Director of
Investigation and Research appointed under the
CIA in relation to their activities in the steel
industry during the years 1975, 1976 and 1977.
On a date between January 27 and February 2,
1981, the Chairman of the RTPC made an order
pursuant to subsection 17 (1) of the CIA that
twenty-nine individuals attend before him or some
other designated person to be examined in the
following entitled matters, viz:
In the Matter of the Combines Investigation Act and section 32
thereof
and
In the Matter of an Inquiry Relating to the Production, Manu
facture, Purchase, Sale and Supply of Flat Rolled Steel, Plate
Steel, Bar and Structural Steel and Related Products
Mr. H. H. Griffin was appointed as hearing officer
to conduct the inquiry scheduled to commence on
Monday, March 2, 1981. Hearings proceeded
before the hearing officer on February 25, March
2, 3, 4, 5, 6, 9 and 12, 1981, at which time the
inquiry was adjourned sine die at the request of
counsel for the Director by virtue of proceedings
taken in the Federal Court of Canada by the
applicants in this application and others. These
proceedings culminated in a decision of the
Supreme Court of Canada released on March 26,
1987: Irvine v. Canada (Restrictive Trade Prac
tices Commission), [1987] 1 S.C.R. 181.
By registered letters dated August 24, 1987 the
Director of Investigation and Research under the
Combines Investigation Act notified the applicants
and their counsel that the validity of the adjourned
inquiry had been upheld by the Supreme Court
and that the hearings for the taking of evidence
upon oath would resume on September 29, 1987 in
Toronto. By order of September 21, 1987 the
Chairman of the RTPC designated J. H. Cleve-
land to be the hearing officer for purposes of the
inquiry. The resumption of the September 29 hear
ings had been adjourned by agreement of counsel,
pending the result of the present application.
On October 6, 1987, Mr. O. G. Stoner, Chair
man of the RTPC, vacated the orders of February
2, 1981 and issued a new order for the attendances
of witnesses to give evidence on oath at the inqui
ry, which was reconvened for November 30, 1987
in Mississauga.
There is also the motion of Samuel, Son & Co.,
Limited and W. Grant Brayley against the RTPC
[Samuel, Son & Co., Ltd. v. Canada (Restrictive
Trade Practices Commission), [1988] 2 F.C. 523
(T.D.)] and the Director of Investigation and
Research for the release of the documentation in
support of the Director's ex parte application of
January 1981 launching the initial inquiry and, or
alternatively, for the setting aside of such order on
the ground that it breached the rules of natural
justice. It had been ordered that this motion be
dealt with concurrently with the other motion of
the nine applicants. Mr. Miller, counsel for the
Samuel and Brayley applicants, requested that his
clients' motion be deemed adjourned sine die,
pending the outcome of the present motion, but on
the understanding that he be at liberty to apply for
a special hearing once the result was certain. The
motion of Samuel, Son & Co., Limited and W.
Grant Brayley was stood aside on that basis.
The issues raised by the applicants have been
directly considered in at least two other cases
presently pending before appellate courts. One of
these is Thomson Newspapers Ltd. et al. v. Direc
tor of Investigation & Research et al. (1986), 57
O.R. (2d) 257 (C.A.), which, as stated, is present
ly under appeal to the Supreme Court of Canada.
The other case is that of Stelco Inc. v. Canada
(Attorney General), [1988] 1 F.C. 510 (T.D.). The
Stelco case is currently under appeal to the Feder
al Court of Appeal and the appeal has been exped
ited to be heard on October 22, 1987 [Court file
No. A-728-87]. I have since been advised by coun
sel that the appeal was dismissed.
The applicants take the position that the ulti
mate outcome of the present application under
section 18 of the Federal Court Act is dependent
upon the outcome of the appeals in the Thomson
Newspapers and Stelco cases. They contend that
until the Charter [Canadian Charter of Rights
and Freedoms, being Part I of the Constitution
Act, 1982, Schedule B, Canada Act 1982, 1982, c.
11 (U.K.)] issues raised by these cases have been
resolved, the Director should not be permitted to
proceed with the present inquiry under section 17
of the Combines Investigation Act.
The question at issue is whether this is an
appropriate case for the granting of a stay of
administrative and investigative process, whether
by prohibition or injunction or otherwise, until the
Supreme Court of Canada has pronounced on the
constitutional question raised in the Thomson
Newspapers appeal.
The statutory provisions most relevant to the
determination of this broad issue are contained in
sections 17(1), 17(2), 17(3), 17(4), 18 [as am. by
S.C. 1974-75-76, c. 76, s. 6] and 20 [as am. idem,
s. 8] of the Combines Investigation Act, which
read as follows:
17. (I) On ex parte application of the Director, or on his
own motion, a member of the Commission may order that any
person resident or present in Canada be examined upon oath
before, or make production of books, papers, records or other
documents to such member or before or to any other person
named for the purpose by the order of such member and may
make such orders as seem to him to be proper for securing the
attendance of such witness and his examination, and the pro
duction by him of books, papers, records or other documents
and may otherwise exercise, for the enforcement of such orders
or punishment for disobedience thereof, all powers that are
exercised by any superior court in Canada for the enforcement
of subpoenas to witnesses or punishment of disobedience
thereof.
(2) Any person summoned under subsection (1) is com
petent and may be compelled to give evidence as a witness.
(3) A member of the Commission shall not exercise power to
penalize any person pursuant to this Act, whether for contempt
or otherwise, unless, on the application of the member, a judge
of the Federal Court of Canada or of a superior or county court
has certified, as such judge may, that the power may be
exercised in the matter disclosed in the application, and the
member has given to such person twenty-four hours notice of
the hearing of the application or such shorter notice as the
judge deems reasonable.
(4) Any books, papers, records, or other documents pro
duced voluntarily or in pursuance of an order under subsection
(1) shall within thirty days thereafter be delivered to the
Director, who is thereafter responsible for their custody, and
within sixty days after the receipt of such books, papers,
records or other documents by him the Director shall deliver
the original or a copy thereof to the person from whom such
books, papers, records or other documents were received.
18. (I) At any stage of an inquiry,
(a) the Director may, if he is of the opinion that the evidence
obtained discloses a situation contrary to any provision in
Part V, and
(b) the Director shall, if the inquiry relates to an alleged or
suspected offence under any provision of Part V and he is
so required by the Minister,
prepare a statement of the evidence obtained in the inquiry
which shall be submitted to the Commission and to each person
against whom an allegation is made therein.
(2) Upon receipt of the statement referred to in subsection
(1), the Commission shall fix a place, time and date at which
argument in support of such statement may be submitted by or
on behalf of the Director, and at which such persons against
whom an allegation has been made in such statement shall be
allowed full opportunity to be heard in person or by counsel.
(3) The Commission shall, in accordance with this Act,
consider the statement submitted by the Director under subsec
tion (1) together with such further or other evidence or ma
terial as the Commission considers advisable.
(4) No report shall be made by the Commission under
section 19 or 22 against any person unless such person has been
allowed full opportunity to be heard as provided in subsection
( 2 ).
20. (I) A member of the Commission may allow any person
whose conduct is being inquired into and shall permit any
person who is being himself examined under oath to be repre
sented by counsel.
(2) No person shall be excused from attending and giving
evidence and producing books, papers, records or other docu
ments, in obedience to the order of a member of the Commis
sion, on the ground that the oral evidence or documents
required of him may tend to criminate him or subject him to
any proceeding or penalty, but no oral evidence so required
shall be used or receivable against such person in any criminal
proceedings thereafter instituted against him, other than a
prosecution for perjury in giving such evidence, or a prosecution
under section 122 or 124 of the Criminal Code in respect of
such evidence.
In Irvine v. Canada (Restrictive Trade Practices
Commission), supra, Mr. Justice Estey, writing
the opinion of the Supreme Court of Canada,
made some interesting and significant comments
on the scheme of Part II of the Combines Investi
gation Act and, more particularly, the proper cor
relation between sections 17 and 18 thereof, which
are reproduced in part hereunder from pages
196-198:
Part II of the Act (by s. 16) establishes the Restrictive Trade
Practices Commission to which reference has already been
made in Part I of the Act in s. 14. Part II then proceeds to lay
out the program for the processing by the Commission of the
material gathered by the Director in his inquiries. When the
Director requires coercive measures to obtain evidence, he may
secure from the Commission, on ex parte application, an order
directed to anyone present in Canada to appear before a
member of the Commission, or any other person named for the
purpose, and be examined upon oath or produce documents
(s.17(1)).
By section 18 of the Act, where the Director is of the opinion
that the evidence obtained discloses an offence under Part V
(the principal competition offences in the Act), the Director
may, or if the inquiry relates to an alleged or suspected offence
under Part V and the Minister so requires, the Director shall
"prepare a satement of the evidence obtained in the inquiry
which shall be submitted to the Commission and to each person
against whom an allegation is made therein". Unlike Part I
where the inquiry section (s. 8) is followed by a section (s. 15)
authorizing the Director to turn evidence and materials gath
ered in the inquiry over to the Attorney General of Canada for
consideration as to whether or not a prosecution should be
instigated, s. 18 provides that the Director may forward a
statement of the evidence obtained in the inquiry to the Com
mission if he is of the opinion that "the evidence obtained
discloses a situation contrary to any provision in Part V" (s.
18(1 )(a)). The Director is neither directed nor authorized by
the statute to include any findings, facts or recommendations in
such a statement. Subsection (1) concludes with a direction to
the Director to forward to each person a copy of the statement
submitted by the Director to the Commission, "against whom
an allegation is made therein". What remains unexplained in
the statute is how the Minister is made aware that an inquiry is
being conducted by the Director under the Act with reference
to an allegation or suspected offence under Part V except where
the Minister has himself directed the inquiry under s. 8. In any
event, if he becomes aware of such an inquiry he may direct the
Director to prepare a statement to the Commission.
Part V of the Combines Investigation Act sets
out various offences in relation to competition.
One of these is the indictable offence of conspiracy
established by section 32 for which one becomes
liable on conviction to imprisonment for five years.
This is the area of primary concern from the
standpoint of the applicants. They feel that they
will suffer irreparable harm not compensable in
damages if they are compelled to testify under
oath at an investigative inquiry under section 17 of
the Combines Investigation Act, which could have
the ultimate result of subjecting them to criminal
prosecution. A similar argument was advanced in
Irvine and rejected by Mr. Justice Estey on the
ground that it foundered "on prematurity in fact
and under the provisions of the Act as well". The
learned Judge amplified his reasons for so finding,
by stating, at page 232 as follows:
The statute, however, does not require a report from the
Director but only a statement of evidence under s. 18. This
statement is not published but is delivered by the Director only
to the persons against whom an allegation is therein made, and
to the Commission. The Commission thereafter is required to
consider the statement as well as "other evidence or material"
as the Commission considers advisable (s. 18(3)), and shall
make a report to the Minister. Where the report is made
"against any person" the Commission shall make no such
report unless such person has been allowed "full opportunity to
be heard in person or by counsel" (subs. (2)). Thus subsections
(2) through (4) of s. 18 largely offset any hardship incurred by
the denial of cross-examination at this preliminary stage before
the Hearing Officer. Any "recommendations" or "findings"
which reach the Minister as a result of this lengthy and tiered
process shall be those of the Commission and not of the
Hearing Officer or of the Director (s. 19(2)). This is the first
report or statement that shall be made public unless the
Commission and the Minister decide publication should be
withheld. None of these potential developments has yet been
realized in the stage that the statutory process has reached in
these proceedings. We are engaged only in the first stage of
information gathering.
Estey J., went on to make this pertinent state
ment, at page 233:
If an individual is prosecuted criminally, s. 20(2) of the Act
prevents testimony he gave at the hearing from being used
against him at trial. Section 643 of the Criminal Code, R.S.C.
1970, c. C-34, may have some relevance with regard to the
testimony given by other witnesses before the Hearing Officer.
Through that provision evidence taken by the Hearing Officer
might conceivably find its way into a criminal process under the
Code. The exception to the hearsay rule enacted by s. 643,
however, would not permit the use of such evidence where the
accused, against whom the evidence might be used, did not
have a full opportunity to cross-examine.
The applicants stoutly maintain that the privi
lege against self-incrimination implicit in section 7
of the Canadian Charter of Rights and Freedoms
would be shattered beyond repair if the investiga
tive inquiry is permitted to proceed. In short, their
submission is that a refusal to grant a stay of
proceedings in this instance would be tantamount
to a final adjudication on the merits to the effect
that the applicants are not entitled to the rights
contained in sections 7 and 8 of the Charter.
Counsel places a great deal of reliance on the
recent Supreme Court of Canada decision in
Manitoba (Attorney General) v. Metropolitan
Stores Ltd., [ 1987] 1 S.C.R. 110 as well as the
Quebec Court of Appeal decision in Canada
(Procureur Général) c. Alex Couture Inc., [ 1987]
R.J.Q. 1971.
In Manitoba (Attorney General) v. Metropoli
tan Stores Ltd., supra, a union applied to the
Manitoba Labour Board for the imposition of a
first collective agreement pursuant to a provision
of the Labour Relations Act [C.C.S.M., c. L10].
The employer commenced proceedings by way of
originating notice of motion in the Manitoba
Court of Queen's Bench to have the statutory
provision declared invalid, as contravening the
Canadian Charter of Rights and Freedoms.
Within the framework of that action, the employer
then applied by way of motion to the Court for an
order to stay the Board until the issue of the
legislation's validity had been heard. The motion
was denied by the motion judge. The employer
then appealed. The Manitoba Court of Appeal
allowed the employer's appeal from the decision
denying the stay order and granted a stay. The
Supreme Court of Canada allowed the Attorney
General's appeal on the ground that the Manitoba
Court of Appeal erred in substituting its discretion
for that of the motion judge in refusing the stay
initially. The main point at issue centred around
the principles that should govern the exercise of a
judicial discretion to order a stay of proceedings
until the constitutionality of impugned legislation
had been determined and, as corollary to that,
whether the appellate court's intervention in the
motion judge's discretion was appropriate in the
circumstances.
Mr. Justice Beetz launched into an exhaustive
analysis of the principles applicable to interlocuto
ry injunctions generally and concluded, at page
127:
A stay of proceedings and an interlocutory injunction are
remedies of the same nature. In the absence of a different test
prescribed by statute, they have sufficient characteristics in
common to be governed by the same rules and the courts have
rightly tended to apply to the granting of interlocutory stay the
principles which they follow with respect to interlocutory
injunctions ...
The learned Judge then focused his attention on
the three main tests to be applied in the process of
judicial decision-making on the issue of whether a
stay of proceedings or an interlocutory injunction
are sustainable remedies in the circumstances.
The three tests can be thus summarized as
follows:
(I) a preliminary and tentative assessment of the merits of the
case which, in a case involving the constitutional challenge of a
law where the public interest must be taken into consideration
in the balance of convenience, is the "serious question" formu
lation of American Cyanamid;
(2) the test of whether the litigant would suffer irreparable
harm that is not susceptible of compensation in damages unless
the injunction is granted; and
(3) the balance of convenience test, or what might be more
appropriately termed the balance of inconvenience, involving a
determination of which of the parties will suffer the greater
harm from the granting or refusal of an interlocutory injunc
tion, pending a decision on the merits.
The learned Judge made these significant com
ments, at pages 135-136:
Whether or not they are ultimately held to be constitutional,
the laws which litigants seek to suspend or from which they
seek to be exempted by way of interlocutory injunctive relief
have been enacted by democratically-elected legislatures and
are generally passed for the common good .... It seems axi
omatic that the granting of interlocutory injunctive relief in
most suspension cases and, up to a point, as will be seen later,
in quite a few exemption cases, is susceptible temporarily to
frustrate the pursuit of the common good.
While respect for the Constitution must remain paramount,
the question then arises whether it is equitable and just to
deprive the public, or important sectors thereof, from the
protection and advantages of impugned legislation, the invalidi
ty of which is merely uncertain, unless the public interest is
taken into consideration in the balance of convenience and is
given the weight it deserves. As could be expected, the courts
have generally answered this question in the negative. In look
ing at the balance of convenience, they have found it necessary
to rise above the interests of private litigants up to the level of
public interest, and, in cases involving interlocutory injunctions
directed at statutory authorities, they have correctly held it is
erroneous to deal with these authorities as if they have any
interest distinct from that of the public to which they owe the
duties imposed upon them by statute.
His examination of the authorities pertaining to
the public interest aspect led the learned Judge to
conclude, at page 149 as follows:
In short, I conclude that in a case where the authority of a
law enforcement agency is constitutionally challenged, no inter
locutory injunction or stay should issue to restrain that author
ity from performing its duties to the public unless, in the
balance of convenience, the public interest is taken into con
sideration and given the weight it should carry. Such is the rule
where the case against the authority of the law enforcement
agency is serious, for if it were not, the question of granting
interlocutory relief should not even arise. But that is the rule
also even where there is a prima facie case against the enforce-
ment agency, such as one which would require the coming into
play of s. 1 of the Canadian Charter of Rights and Freedoms.
Finally, and I think this is very significant in
terms of the actual result of the case, Beetz J.,
made the following statement of principle, at page
157:
The judgment of the Court of Appeal could be construed as
meaning that an interlocutory stay of proceedings may be
granted as a matter of course whenever a serious argument is
invoked against the validity of legislation or, at least, whenever
a prima facie case of violation of the Canadian Charter of
Rights and Freedoms will normally trigger a recourse to the
saving effect of s. 1 of the Charter. If this is what the Court of
Appeal meant, it was clearly in error: its judgment is in conflict
with Gould,' supra, and is inconsistent with the principles set
out herein.
In Canada (Procureur Général) c. Alex Couture
Inc., supra, the Quebec Court of Appeal followed
the Metropolitan Stores decision in dismissing an
appeal from an interlocutory judgment of the Su
perior Court granting an order for a stay of pro
ceedings before the Competition Tribunal until
October 1, 1987. The Attorney General argued
that the Superior Court lacked jurisdiction to pro
nounce the judgment in question. The Court of
Appeal found that the Superior Court had an
inherent power to grant the stay in a case involving
a constitutional issue. On the Attorney General's
alternative submission that the Superior Court
erred in exercising its jurisdiction to grant the stay,
the Court held that it was not in the public interest
to revoke the order granting the stay. It is note
worthy, in my view, that the respondents' action
challenging the constitutionality of the proceedings
before the Competition Tribunal were set down
before the Superior Court for hearing on the
merits on September 29 and 30 and October 1,
1987. This is one distinguishing feature from the
case at bar. The other essential point of distin-
guishment lies in the fact that the respondents had
commenced an action for a declaration challenging
the constitutional validity of the Competition Act
[R.S.C. 1970, c. C-23 (as am. by S.C. 1986, c. 26,
s. 19)].
' Gould v. Attorney General of Canada et al., [ 1984] 2
S.C.R. 124; affg. [1984] 1 F.C. 1133 (C.A.).
The applicants strenuously contend that this is a
clear case where the Court should exercise its
discretion in favour of granting a stay of the
present inquiry proceedings before the RTPC
pending a final determination by the Supreme
Court of Canada of the constitutional question
posed in the Thomson appeal. It is submitted that
they will suffer irreparable harm that cannot be
compensated in damages if they are compelled to
give evidence upon oath at the inquiry. Any pro
tection afforded by sections 7 and 8 of the Charter
will be forever lost. The applicants submit that the
balance of convenience, viewed in the public inter
est perspective, clearly weighs in their favour in
terms of their Charter rights and that the public
interest will not be harmed if the inquiry is post
poned until the Supreme Court has pronounced on
the constitutional issue. The point is also made
that the present investigative proceeding was
adjourned for some six years with the consent of
the Director.
Counsel for the respondents raises the proce
dural point that the present application under
section 18 of the Federal Court Act is an originat
ing motion and cannot be regarded as interlocuto
ry in any real sense because there is no action.
Since the relief sought is not interlocutory relief
within the framework of an existing action, the
principles applicable to the granting of an inter
locutory injunction or stay of proceedings do not
apply with the result that the Court should be
reluctant to grant final relief that would have the
effect of staying the exercise of the administrative
process in another tribunal. The point is also made
that the orders compelling the attendance of wit
nesses at the inquiry are in the nature of subpo
enas ad testificandum, the making of which simply
constitutes the exercise of a non-reviewable
administrative function.
Does the tripartite test of American Cyanamid
[American Cyanamid Co. v. Ethicon Ltd., [1975]
A.C. 396 (H.L.)] apply at all in the case of an
attack under section 18 of the Federal Court Act
on the exercise of statutory authority by an
administrative tribunal? In my opinion, it does not,
despite the contrary view cited by the Alberta
Court of Appeal in Law Society of Alberta v.
Black et al. (1983), 8 D.L.R. (4th) 346. I prefer to
adopt the reasoning of the Nova Scotia Supreme
Court, Appeal Division, in McFetridge v. Nova
Scotia Barristers' Society (1981), 123 D.L.R. (3d)
475, which the Court in Black declined to follow.
MacKeigan C.J.N.S., made this statement, at
page 476:
The interim injunction is not being asked in an ordinary civil
action inter partes to restrain some injury such as trespass or
breach of patent pending the adjudication of the parties' rights
at trial. In our opinion, the principles on which an interim
injunction may be granted in such actions, as propounded in
cases such as American Cyanamid Co. v. Ethicon Ltd., [1975]
A.C. 396, and discussed by Mr. Justice Burchell, have limited
relevancy where, as here, the plaintiff asks for a declaration
and permanent injunction to prevent a quasi-judicial tribunal
from exercising its prima facie statutory powers and duties.
The action is akin to an action for an order by way of
prohibition against a statutory tribunal prohibiting it from
acting beyond its jurisdiction.
The learned Chief Justice went on to state the
following conclusion, at page 477:
The Court should not interfere by interim injunction or stay
except in very special circumstances, e.g., where it is necessary
to obtain time for the Court to adjudicate the issue and where
the consequences of not staying the lower proceedings would be
serious and irreversible.
See also Lodge v. Minister of Employment and
Immigration, [1979] 1 F.C. 775 (C.A.) in which
the Court held that it would be wrong to apply the
serious question test for an interlocutory injunction
as laid down in American Cyanamid to an applica
tion under section 18 of the Federal Court Act for
a permanent injunction, albeit one limited in time,
on the ground that it was impossible to assimilate
that sort of permanent injunction to an interlocu
tory injunction in an action.
In Ziegler v. Hunter, [1984] 2 F.C. 608; (1983),
8 D.L.R. (4th) 648, the Federal Court of Appeal
held that section 17 of the Combines Investigation
Act did not contravene paragraph 2(d) of the
Canadian Bill of Rights [R.S.C. 1970, Appendix
III] or section 8 of the Charter. Marceau J. noted
the appellants' reference to sections 2 and 7 of the
Charter but was unable to see how these supported
the proposition of unconstitutional encroachment
on rights to privacy and security against unreason
able search and seizure, independently of section 8
of the Charter. The Court was clearly of the view
that there was in Canada no absolute privilege of a
witness except as defined by statute as, for exam
ple, section 5 of the Canada Evidence Act [R.S.C.
1970, c. E-10] and subsection 20(2) of the
Combines Investigation Act.
The substantive rights to life, liberty and secu
rity of the person enshrined in section 7 of the
Charter are by no means absolute but must be
balanced against the corresponding rights of others
and the collective right of society generally, recog
nizing "that the central concern of the section is
direct impingement by government upon the life,
liberty and personal security of individual citi
zens": see Operation Dismantle Inc. et al. v. The
Queen et al., [1985] 1 S.C.R. 441, at page 490; 18
D.L.R. (4th) 481, at page 518 per Madam Justice
Wilson. Moreover, the Charter was not enacted in
a vacuum and the rights set out therein must be
interpreted rationally having regard to existing
laws: Re Federal Republic of Germany and Rauca
(1983), 41 O.R. (2d) 225, at page 244; 145 D.L.R.
(3d) 638, at page 658 (Ont. C.A.). Indeed, it is
useful to remember that the framers of our Chart
er, unlike the drafters of the Fifth Amendment to
the United States Constitution, deliberately drew
a line between non-compellability and statutory
protection against the use of incriminating evi
dence in the case of a witness. The purpose of the
compulsion is not to incriminate the witness but to
produce evidence which must be given if the public
interest is to be served: see Haywood Securities
Inc. v. Inter-Tech Resource Group Inc. (1985), 24
D.L.R. (4th) 724 (B.C.C.A.) per Macfarlane J.A.
On the point of whether the orders issued under
subsection 17(1) of the Combines Investigation
Act for the attendance of witnesses contravene
section 7 of the Charter, I fully concur with the
reasoning and conclusions of the Associate Chief
Justice in the Stelco case, at pages 524-525:
These proceedings are not of a nature to require the protec
tion against self-incrimination which is accorded a person
charged with an offence. I have already determined that the
investigative powers under attack here are part of an adminis
trative procedure. No substantive determination of the parties'
rights can be made at the investigative stage. Neither the
Director nor the Commission has the authority under the
Combines Investigation Act to institute criminal proceedings
against the applicants based on information obtained during the
inquiry. The Director's authority is limited to referring the
evidence to the Attorney General of Canada (subsection 15(1))
or placing a statement of evidence before the Restrictive Trade
Practices Commission pursuant to sections 18 and 47. In the
latter case, notice is to be given to all persons against whom
allegations are made. Those persons are then afforded full
opportunity to be heard in person or by counsel. The Commis
sion's report which reviews the evidence and contains recom
mendations is then transmitted to the Minister. Accordingly,
the inquiry stage of the proceedings does not determine any
rights of the applicants or impose any liabilities on them. It
does not require, therefore, any additional protection against
self-incrimination beyond that provided by subsection 20(2) of
the Act.
The privilege against self-incrimination, as it exists in
Canada, does not permit these witnesses to refuse to answer
questions during the course of an investigative hearing. It
clearly cannot provide them the right to refuse to attend. They
are fully protected against the subsequent use of any
incriminating answers by the Canada Evidence Act and subsec
tion 20(2) of the Combines Investigation Act, as well as section
13 of the Charter. When coupled with the right to counsel,
these protections are more than adequate in the factual circum
stances of this case.
In the result, I find that the applicants have
failed to demonstrate such serious and irreversible
consequences resulting from the first stage of an
investigative process as would justify granting an
interim injunction or stay of proceedings. Rather, I
consider that the public interest will be better
served by permitting the inquiry to proceed. In
reaching this conclusion, I am mindful of the
admonition of Mr. Justice Estey in Irvine v.
Canada (Restrictive Trade Practices Commission)
[at page 235] to the effect that courts in the
exercise of their discretion must "remain alert to
the danger of unduly burdening and complicating
the law enforcement investigative process".
For the foregoing reasons, the applicants'
motion is dismissed with costs.
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