E. Bruce Mellett

The Attorney General of Canada appealed from the Alberta Court of Appeal's ruling that the federal Impact Assessment Act and Physical Activities Regulations were entirely ultra vires Parliament.

The Supreme Court allowed the appeal in part, holding that the designated projects scheme is unconstitutional because it is not in pith and substance directed at regulating effects within federal jurisdiction — those effects do not drive the scheme's decision-making functions — and because the defined term 'effects within federal jurisdiction' does not align with federal legislative jurisdiction.

However, the secondary scheme in ss. 81 to 91 of the IAA, which governs projects on federal lands or outside Canada, was found to be clearly intra vires and severable.

The dissent would have upheld the entire legislation as validly directed at assessing and regulating adverse federal effects.

In a utilities rate-setting appeal, the Court considered whether Alberta statutes requiring prudent costs imposed a mandatory no-hindsight methodology.

The Court held the regulator retained discretion to choose its analytical approach, provided resulting rates were just and reasonable to both consumers and utilities.

On the record, the disallowed pension cost-of-living adjustment component was reasonably treated as forecast rather than committed cost.

Limiting recoverable COLA to 50 percent of CPI, capped at 3 percent, for specified pension calculations was therefore reasonable.

The appeal was dismissed.