The Association of Justices of the Peace of Ontario/L’Association des juges de paix de l’Ontario v. Ontario, 2016 ONSC 6001

CITATION: The Association of Justices of the Peace of Ontario/L’Association des juges de paix de l’Ontario v. Ontario, 2016 ONSC 6001

DIVISIONAL COURT FILE NO.: 130/16

DATE: 21061025

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

Swinton, Sachs and Pattillo JJ.

BETWEEN:

THE ASSOCIATION OF JUSTICES OF THE PEACE OF ONTARIO/ L’ASSOCIATION DES JUGES DE PAIX DE L’ONTARIO Applicant

– and –

HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO Respondent

COUNSEL: J. Thomas Curry, Scott Rollwagen and Mariam Moktar for the Applicant Sarah T. Kraicer and Josh Hunter for the Respondent

HEARD at Toronto: September 20 and 21, 2016

REASONS FOR JUDGMENT

Swinton J.:

Overview

[1] The Association of Justices of the Peace of Ontario/L’Association des juges de paix de l’Ontario (the “Association”) has brought an application for judicial review of the Response of the Lieutenant-Governor in Council (the “LGIC”) to the Report of the Sixth Justices of the Peace Remuneration Commission (the “Sixth Commission”). The Association argues that Ontario has acted unconstitutionally in rejecting the recommendations respecting salary and compensation for WASH (Weekend and Statutory Holiday) Court days and in acting unilaterally to make changes to benefit plans before an independent commission has made a recommendation on this issue.

[2] The respondent, Her Majesty the Queen in Right of Ontario (“Ontario”), has also brought a motion to set aside an interlocutory order made by Stewart J. that stayed the operation of a regulation and order-in-council implementing benefit changes for justices of the peace until the determination of the application for judicial review.

[3] For the reasons that follow, I would grant the application for judicial review in part – that is, with respect to the issue of benefits – and I would dismiss the motion to set aside the stay order.

The Process for Determining the Remuneration of Justices of the Peace

The Governing Constitutional Principles

[4] In Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island, 1997 317 (SCC), [1997] 3 S.C.R. 3, the Supreme Court of Canada held that the constitutional principle of judicial independence requires that an independent commission play a role in the determination of the remuneration of judges. Given that justices of the peace are judicial officers, this constitutional principle applies to the determination of their remuneration.

[5] The purpose of the commission process is to depoliticize the process of determining judicial remuneration (at paras. 147 and 166), by operating as an “institutional sieve” separating the government and the judiciary (at para. 170). It is the task of the commission to present a report with recommendations on remuneration to the government. Commissions must be independent, objective and effective. The government may depart from the commission’s recommendations, but only if it justifies the departure with rational reasons (at paras. 133, 180, and 183).

[6] The Supreme Court of Canada elaborated on these governing principles in Provincial Court Judges Association of New Brunswick v. New Brunswick, 2005 SCC 44, [2005] 2 S.C.R. 286 (“Bodner”), especially the concept of giving “meaningful effect” to the report of the commission. The Court held that the government must give weight to the commission’s recommendations and must give legitimate reasons, based on a reasonable factual foundation, for departing from the recommendations (Bodner at paras. 23-26).

Ontario’s Process for Determining the Remuneration of Justices of the Peace

[7] The Commission is a statutory body established pursuant to O. Reg. 319/00, Justices of the Peace Remuneration Commission. Members are appointed by order-in-council – one member selected by the Association, one by the Chair of the Management Board of Cabinet, and the chair selected jointly by the other two members (s. 2(1)).

[8] The purpose of the Commission process is set out in s. 0.1 of the Regulation:

The purpose of this Regulation is to establish a framework for the regulation of certain aspects of the relationship between the executive branch of the government and the Justices of the Peace. It is intended that both the process of decision-making and the decisions made by the Commission shall contribute to securing and maintaining the independence of Ontario’s Justices of the Peace. Further, this Regulation is intended to promote co-operation between the executive branch of the government and the judiciary and the efforts of both to develop a justice system which is both efficient and effective, while ensuring the dispensation of independent and impartial justice.

[9] The members of the Commission are appointed to make recommendations concerning the remuneration of justices of the peace over a specified time period. The Sixth Commission was appointed to make recommendations for the period from April 1, 2011 to March 31, 2015.

[10] In developing its recommendations, the Commission is required to consider the criteria set out in s. 7 of the Regulation:

1. The laws of Ontario.
2. The need to provide fair and reasonable remuneration to justices of the peace.
3. The economic conditions in the province, as demonstrated by indicators such as the provincial inflation rate.
4. Recent Ontario public sector compensation trends.
5. The growth or decline in per capita income.
6. The financial policies and priorities of the Government of Ontario.
7. The principles of compensation theory and practice in Canada.
8. The parameters set by any joint working committees established by the parties.
9. Any other factor the Commission considers relevant.

[11] The report of the Commission is submitted to the LGIC. Pursuant to s. 10(1) of the Regulation, the LGIC must give “full consideration” to the report, although it is not bound by it. The LGIC must respond to the report within the time lines set out in s. 10 of the Regulation.

The Report of the Sixth Commission

[12] The Sixth Commission was composed of the Hon. Patrick Lesage as Chair, Linda Rothstein as Association nominee and Roy Filion as government nominee. It received submissions and held hearings intermittently between October 2013 and mid-January 2014.

[13] On February 18, 2014, Ontario announced changes to the Management Compensation Plan/Extended Benefits Plan and changes to post-retirement insured benefits applicable to a sector of the public service. In March, 2014, Ontario asked the Association to join with it in a joint submission to the Sixth Commission that would propose a harmonization of benefits and post-retirement benefits for justices of the peace consistent with the changes announced in February. The Association opposed consideration of the proposed changes in the context of the Sixth Commission’s mandate.

[14] The Sixth Commission nevertheless agreed to hear further submissions. These were completed in late August 2014. Subsequently, with the Commission’s encouragement, the parties met and tried to narrow the issues or reach a consensus. In mid-December, 2014, the Commission was informed that no consensus had been reached, despite the use of a facilitator.

[15] The Sixth Commission then reported on March 9, 2015 with a Majority Report authored by Commissioners Lesage and Rothstein and a Minority Report by Commissioner Filion.

[16] With respect to the benefit and pension issues, the Majority Report stated (at para. 4):

In the absence of any such agreement [of the parties] and given the significant time that has passed since our hearings were completed we have reluctantly concluded that it would be unwise and injudicious to report on the Benefits/Pension issues. The issues are both complex and important, and would require opening the oral hearing which would unduly delay the release of our report.

The Majority also stated later in the Report that it declined to make recommendations with respect to pensions and benefits and recommended that the next Commission be activated no later than June 2016 in order to facilitate a more timely report (at para. 70). The Minority agreed that these issues should be deferred to the Seventh Commission.

[17] The major point of disagreement between the Majority and the Minority was with respect to the salary recommendation. The Majority concluded that there had been an ongoing evolution in the complexity of the work done by justices of the peace, and that their remuneration was not fair and reasonable. Although their salary would rise automatically in accordance with the Industrial Aggregate Average (“IAI”) for Ontario in each year of the mandate, the Majority concluded that there should be a further “significant” increase in each year to reflect increased complexity in the work of justices of the peace (at para. 54). The Majority also considered the economic conditions in Ontario, the general policy of restraint in public sector compensation, the general decline in per capita income, and the evidence that there was no shortage of applicants for the position. They recommended increases totaling 7.6% over the 4 years in addition to the IAI increase of 8.2%.

[18] The Minority Report recommended that there should be no increase beyond the IAI, as working conditions had not changed “sufficiently” to justify a greater increase, given the criteria the Commission was required to consider (at p. 5).

[19] The Commission made unanimous recommendations with respect to increases to the tax-free allowance, more frequent replacement of judicial attire, and costs. There was disagreement, however, with respect to WASH Court days – that is weekend and statutory holiday court assignments. The Majority recommended that those assignments should be credited as equivalent to 1.5 days of regular sittings because of the additional burden on family and private life. The Minority recommended that justices of the peace continue to receive payment for the WASH Court days worked and one compensating day off for each of those days. The Minority noted that that this would be consistent with the treatment of provincial judges, who receive one compensating day off for WASH Court days.

The Government’s Response

[20] On December 7, 2015, the LGIC issued a 13 page letter in response (the “Response”). It rejected the Majority’s recommendations with respect to salary and WASH Court credit and agreed with the Minority recommendations.

[21] Even though the Commission had declined to make any recommendations respecting changes to benefits, the LGIC disagreed with deferring implementation of the changes until the report of the next Commission. It stated that the proposed changes respecting the benefit plans would be implemented pending any changes recommended by future Commissions.

[22] I will analyze the reasons of the LGIC in more detail after setting out the standard of review in this application and the issues raised by the Association.

Events following the Release of the Response

[23] The Association brought an application for judicial review to challenge Ontario’s Response.

[24] Ontario began to implement the benefit changes through the adoption of O. Reg. 56/16 and Order-in-Council 229/2016 (the “OIC”). The changes were intended to come into effect on April 1, 2016, except for changes to post-retirement benefits, which would take effect January 1, 2017.

[25] The Association brought a motion for interlocutory relief, seeking a stay order to prevent the government from implementing the proposed changes until the determination of the application for judicial review. Stewart J. granted a stay of the regulation and OIC on April 1, 2016.

The Standard of Review

[26] The standard of review in an application such as this was set out by the Supreme Court of Canada in Bodner, above, at para. 31. The standard is a deferential one of simple rationality. Such a standard recognizes the government’s expertise in and constitutional responsibility for decisions allocating public funds (at para. 30).

[27] Accordingly, on judicial review, a court must ask:

1. Has the government articulated a legitimate reason for departing from the commission’s recommendations?
2. Do the government’s reasons rely upon a reasonable factual foundation? To be more precise, has the government indicated a factual basis on which it based its response, and was it rational for the government to rely on such facts in light of the evidence before the court?
3. Viewed from a global perspective, has the government respected the commission process, and have the purposes of the commission – preserving judicial independence and depoliticizing the setting of judicial remuneration – been achieved?

The Issues on this Application

[28] The Association raises three issues:

1. Did Ontario provide a rational basis for departing from the Sixth Commission’s salary recommendation when it rejected the Commission’s factual determination that the complexity of the work of justices of the peace has increased sufficiently to justify an increase in remuneration?
2. Did Ontario show appropriate respect for the Commission process as a whole in adopting the approach of the Minority as the basis for its decision?
3. Is Ontario permitted to proceed with its planned benefit changes without the benefit of any independent Commission consideration of them?

[29] Essentially, the Association argues that Ontario failed to satisfy the second and third branches of the Bodner test in its response respecting salary, WASH Court days, and benefits.

[30] Ontario argues that it has provided a rational basis for rejecting the recommendations, and it has respected the commission process.

Issue No. 1: Did Ontario provide a rational basis for departing from the Sixth Commission’s salary recommendation?

The Association’s Argument

[31] The Association argues that the Sixth Commission made a key finding that the complexity of the work of justices of the peace had increased over the period of its mandate. It argues that Ontario’s response on the issue of complexity is not based upon a rational foundation, as Ontario failed to appreciate the qualitative evidence concerning the change in the work of justices of the peace in recent years.

Ontario’s Response

[32] Pages 2 through 10 of the Response dealt with salary. The LGIC started with the position that justices of the peace had already received a significant salary increase through the application of the IAI, which had been recommended in the Fifth Commission’s report and implemented by Ontario. That increase of 8.2% resulted in a monetary increase of $9,538 and an annual salary that would be $125,661 in 2014. The Majority recommendation, if accepted, would result in an overall increase of 16.4%, amounting to $19,908 and a salary of $135,221 in 2014.

[33] The LGIC concluded that the proposed salary was not fair and reasonable, having regard to the role, qualifications and duties of justices of the peace. It disagreed with the Majority’s finding that the role and nature of the work of justices of the peace had changed significantly in recent years. It took note of the significant increase of 23.1% over three years recommended by the Fourth Commission in 2007 and accepted by Ontario. It also disagreed with the conclusion that the complexity of the work had increased significantly since the reports of the Fourth and Fifth Commissions.

[34] The LGIC also looked at the lack of quantitative data to show an increase in workload and noted that there had been no substantial changes in jurisdiction. It noted that the number of charges had declined, and there had been reforms to streamline work. It also pointed to a lack of evidence of an increased number of unrepresented litigants.

[35] While the Majority had relied on anecdotal evidence from a justice of the peace who testified, the LGIC observed that the witness had described the changes in the work as “tweaks”, rather than radically different changes.

[36] The LGIC concluded that the Majority’s finding of a significant increase in the complexity of the work was not well-founded. In the alternative, any increase in workload was modest, and the Majority had given this factor undue weight. The LGIC then stated that the Minority correctly determined that there had been no change to the workload of the justices of the peace that warranted a significant increase beyond the IAI.

[37] The LGIC disagreed with the Majority view that the salaries of justices of the peace are disproportionately low in comparison to other judicial officers, including provincial judges, case management masters, and Federal Court prothonotaries. The LGIC noted that justices of the peace do not need to be legally trained, unlike justices of the peace in Alberta and Quebec, and provincial judges and case management masters must be lawyers with at least ten years of experience and they have a broader jurisdiction.

[38] The LGIC also concluded that the Majority failed to give sufficient weight to the other criteria the Commission was mandated to consider - in particular, the economic conditions in the province. It pointed out that the Majority erroneously stated that salaries should not be reduced in 2011-13 because there was a period of severe fiscal restraint when hearings were held in 2013 and 2014. The Response set out data showing that Ontario was in a period of severe fiscal restraint throughout the whole period of the Sixth Commission’s mandate.

[39] The Response stated that the proposed increases would generate a per capita income for justices of the peace well above salary increases for public sector and broader public sector groups in the province. It described the government’s policy of fiscal restraint and set out tables showing increases for other public sector groups, as well as provincial judges and deputy judges, that were much less than those proposed for justices of the peace. It also noted that there had been no difficulty in recruiting qualified candidates at current salary levels.

[40] For all these reasons, the LGIC accepted the Minority salary recommendation that the only increase should be the 8.2% resulting from IAI indexing.

[41] The LGIC also rejected the Majority recommendation with respect to 1.5 days credit for WASH Court days. Instead, it agreed with the Minority view that justices of the peace should receive the same credit as provincial judges – pay for the day of work and a compensating day off for the WASH Court day. The LGIC was of the view that the Majority failed to provide any rationale for the different treatment of justices of the peace and other judicial officers, noting that the additional burden on family and private life applied to all judicial officers presiding in such a court.

Analysis with respect to the Salary Recommendation

[42] The Association has not taken issue with the legitimacy of the reasons of the government in departing from the salary recommendation. Rather, it focuses on one aspect of Ontario’s response in respect of the salary recommendation - the conclusion that the work of justices of the peace had not significantly increased in complexity in recent years - and submits that there was not a rational basis for rejecting that finding. More precisely, the Association argues that Ontario has not meaningfully explained why it disagreed with the Majority’s finding on this point.

[43] In determining whether there is a reasonable factual foundation for the government’s response, a court must ask whether the government has explained the factual foundation for its reasons and whether it is rational for the government to rely on the stated facts or circumstances (Bodner at paras. 36-37). The factual foundation step does not require the government to defer to a Commission’s findings of fact, as the Commission is not an adjudicative body tasked with finding facts, nor does it require the government to adduce evidence to show those findings of fact are in error. On judicial review, the focus is on the government’s response. Moreover, the court should not focus on one aspect of the government’s reasons. Rather, the court must look at the reasons in their entirety (Bodner at para. 133).

[44] In my view, Ontario’s response with respect to the salary recommendation satisfies the second stage of the Bodner test. Ontario explained in detail why it disagreed with the Majority’s conclusion on this issue, as set out above in my reasons. It gave three main reasons for disagreeing with the Commission’s conclusion that the workload of the justices of the peace had become more complex, and there was a reasonable factual foundation supporting these reasons:

1. The anecdotal evidence, on which the Majority relied, suggested a modest increase in the role of justices of the peace.
2. The Majority failed to adequately consider the responding evidence submitted by the government, which showed that there had not been significant changes in the role.
3. The Majority failed to appreciate that the increased complexity and the changes in role had been taken into account by the Fourth and Fifth Commissions in their reports.

[45] In addition, the Association submits that the LGIC should not have relied on the Minority report. In particular, the Association submitted that Commissioner Filion improperly drew on his personal experience as a member of the Fourth and Fifth Commissions. However, the Commissioner’s statement must be placed in context. After saying that he drew on his past experience, the Commissioner quoted in detail from the Fifth Commission report, which quotes the Fourth Commission report. He did so to support his conclusion that these earlier commissions had taken into account the importance of the role of justices of the peace and the increased complexity of their work. There was nothing improper in relying on these reports.

[46] Most importantly, the LGIC did not just adopt the Minority position without further explanation and analysis. It first gave reasons for its disagreement with the Majority’s finding of increased complexity. It also gave other reasons why it disagreed with the salary recommendation - for example, the Majority did not give proper consideration to the differences in qualifications and jurisdiction of other judicial officers.

[47] The Association argues that it was irrational for the LGIC to rely on the fact that justices of the peace need not be lawyers. I disagree. It was reasonable for the LGIC to conclude that higher salaries would be required to attract those with law degrees and who have been members of the bar for a minimum period, as is the case for provincial judges and case management masters.

[48] Finally, the LGIC disagreed not only with the significance of any increase in complexity in the work of justices of the peace. It also disagreed with the weight given to economic and fiscal factors by the Majority. The Supreme Court of Canada has said that a government is entitled to reweigh factors if it gives legitimate reasons for doing so ((Bodner, at paras. 39 and 165). The LGIC provided detailed evidence showing that the proposed increase would greatly exceed the increases to others employed in the public sector, including provincial judges and deputy judges. The LGIC also put great weight on the difficult economic conditions in Ontario throughout the mandate of the Commission, correctly noting that the Majority appears to have erred in suggesting that those conditions did not exist in the first years of the mandate.

[49] The Association argues that justices of the peace should be treated differently from others in the public sector because of the increasing complexity of their work. However, it is telling that the Third Deputy Judges Remuneration Commission concluded that the work and responsibility of deputy judges had increased significantly, but still recommended only IAI increases.

[50] In conclusion, the second step in Bodner has been satisfied, as there was a rational basis for the government’s response to the salary recommendation.

Analysis respecting the WASH Court Days

[51] Similarly, Ontario gave a rational reason for rejecting the Commission recommendation respecting WASH Court days. The LGIC stated that provincial judges who work in WASH Court receive pay for the day worked and one compensating day off without deduction from their salary. The LGIC concluded that it was fair to treat justices of the peace in the same way. Again, that is a rational response based on a reasonable factual foundation.

Issue No. 2: Did Ontario show appropriate respect for the Commission process as a whole in adopting the approach of the Minority as the basis for its decision?

[52] The third step of the test in Bodner requires the court to view the government response globally and ask whether the government engaged in meaningful way with the process of the commission.

[53] The Association argues that Ontario failed to respect the Commission process because it improperly relied on the Minority Report, simply adopting what the Minority said. To the extent that the LGIC enlarged on the Minority reasons, it repeated Ontario’s submissions to the Commission, treating the process as an “echo chamber.”

[54] I disagree. The Response sets out in detail why the LGIC disagreed with the Majority recommendation on salary. It explained why it preferred the Minority analysis and conclusion. It accepted some of the Commission’s recommendations respecting allowances, attire and books. Reading the Response as a whole, I conclude that Ontario has engaged meaningfully with the Commission process in respect of the salary and WASH Court day issues.

Issue No. 3: Is Ontario permitted to proceed with its planned benefit changes without the benefit of any independent Commission consideration of them?

The LGIC’s Response

[55] Ontario’s Response states that the parties supported a harmonization of benefits during the Fifth Commission “on the understanding that this conversion would apply to enhancements, reductions and other changes in benefit coverage”. The LGIC stated that the Commission had “declined” to make any recommendation with respect to benefit changes and had, in effect, accepted the Association’s view that the status quo should continue until the Seventh Commission has reported.

[56] The LGIC disagreed with deferring the application of the benefit changes to justices of the peace, stating that the Sixth Commission failed to consider the financial and administrative effects of its failure to make a recommendation. The Response suggests that the Commission had an alternative way to proceed – for example, by issuing a report in two stages.

[57] The LGIC indicated that it would apply the benefit changes pending any changes recommended in the future by the Commission. However, implementation would be delayed until April 1, 2016. The LGIC explained that the proposed changes would continue the advantages resulting from the earlier harmonization of plans for various public sector employees that followed the Fifth Commission process. This should result in a lower risk of unexpected premium increases due to volatile claims experience. The LGIC took the view that the changes would result in a modernization of the benefit program with reductions in some benefits and enhancement in others.

[58] With respect to post-retirement benefits, the LGIC relied on its deficit reduction objectives and its goal of cost containment and reducing administrative burdens. Such changes would come into effect January 1, 2017, with one change: eligibility for these benefits would require ten years of credit in the Public Service Pension Plan for justices of the peace, instead of 20 years, the requirement for other public servants.

The Association’s Submissions

[59] The Association submits that the Response is not rational, in that it fails to engage with the Commission’s reason to defer consideration of the benefits issue – that is, the issue was too complex to deal with in a time effective manner. Moreover, the Association argues that in proceeding to implement the changes to the benefit plans as it did, Ontario failed to respect the purpose of the Commission process.

Analysis

[60] I agree with the Association’s submissions. In my view, Ontario’s response does not withstand scrutiny, even on a deferential rationality standard of review. More importantly, it has not respected the purpose of the Commission process - namely, to preserve judicial independence and depoliticize the setting of judicial remuneration.

[61] To meet the rationality test, the government must respond to the Commission’s recommendations (Bodner at paras. 23-24). In its Response, Ontario has not engaged with the Commission’s conclusion that the issue of benefits was too complex to deal with in a timely manner, and that it was better left to the next Commission, which should be appointed in a timely manner.

[62] Ontario mentions in its Response that the parties agreed to a harmonization of benefits at the time of the Fifth Commission. However, that does not mean they agreed to any and all benefit changes in the future. It is apparent from the Fifth Commission’s report that the Association was accepting the initial harmonization plan and no more. Indeed, the fact that the government asked the Sixth Commission to reopen the hearing in February 2014 and receive further submissions on benefits acknowledges the constitutional obligation to obtain the input of the independent Commission before making changes to the remuneration of justices of the peace.

[63] The proposed changes were initially to come into effect on January 1, 2015. This was later changed to April 1, 2016, a date outside the mandate of the Sixth Commission. Ontario had requested the Sixth Commission to deal with this issue late in the process, after hearings had concluded. After receiving submissions and after discussions between the parties failed to narrow the issues, the Sixth Commission reasonably decided, in March 2015, that the proposed changes were complex and important, and they should be left to the next Commission. It then urged a timely appointment of that Commission. As of the date of the Report, no changes to benefits had been made. In its Response, Ontario has not explained why the issue should not be left to the Seventh Commission.

[64] The evidence in the record before the Court shows that Ontario has not implemented post-retirement benefit changes with respect to certain other groups, such as provincial judges, case management masters and two groups of government lawyers. It has not adequately explained why it chose to act with respect to justices of the peace and not these other groups, especially in light of the Sixth Commission’s view that this issue should be considered by another Commission.

[65] Ontario submits that there are financial advantages to these changes, and the proposed changes bring some enhanced benefits for the justices of the peace. The problem with this argument is that it presents only the government’s perspective on the proposed changes, which are extensive. The Association did not agree with the proposals, and one can see that there are some changes which might not be perceived as advantageous, such as the requirement that retirees pay 50% of benefit costs when they presently pay nothing.

[66] It is not for this Court to assess the pros and cons of the proposed changes. That is the role of the independent Commission - to act as the “institutional sieve”, assessing the strengths and weaknesses of the parties’ positions in light of the criteria in the Regulation, including fair and reasonable remuneration for the justices of the peace and economic conditions in the province. As the Supreme Court of Canada has reiterated most recently in Conférence des juges de paix magistrats v. Quebec (Attorney General), 2016 SCC 39 at para. 45:

… it is a clearly established principle that any changes or freezes in judicial remuneration require prior recourse to a committee to avoid the possibility or appearance of political interference through economic manipulation (1997 Reference, at para. 133).

[67] I need not decide whether a government may ever act unilaterally to make changes to remuneration in the absence of Commission input. The Supreme Court of Canada has said in Conférence des juges de paix magistrats, above at para. 97:

Indeed, an infringement of judicial independence can only be justified where there are “dire and exceptional financial emergencies caused by extraordinary circumstances such as the outbreak of war or imminent bankruptcy” (Mackin, at para. 72, citing 1997 Reference, at para. 137).

[68] There are no exceptional circumstances here that justify Ontario changing the benefits of justices of the peace before the Commission process considers and reports on the issue. In implementing the benefit changes without the input of a new Commission, despite the Sixth Commission’s view that this is the preferable way to proceed with this complex issue, Ontario has not respected the constitutional principle that there be an effective and meaningful commission process before changes are made to judicial remuneration.

The appropriate remedy

[69] The Association sought an order in the nature of certiorari quashing the LGIC’s Response insofar as it failed to accept the recommendations of the Commission and an order prohibiting Ontario from proceeding with the implementation of the benefit changes until an independent Commission could consider and report on them.

[70] In other cases in which a government’s response has not complied with constitutional requirements to protect judicial independence, the remedy has been to refer the issue or issues back to the government to allow it to reconsider its response (Bodner at para. 44). This is understandable, as there may be a range of rational responses to a particular recommendation. Only in exceptional circumstances has a court made an order implementing the recommendation of a Commission (see, for example, Manitoba Provincial Judges Assn. v. Manitoba, 2013 MBCA 74 at paras. 155-62).

[71] In the present case, Ontario was not justified in implementing changes to the benefits without first receiving the input of an independent Commission. Accordingly, the changes implemented through O. Reg. 56/16 and the OIC are unconstitutional, and its Response with respect to benefits should be quashed.

[72] However, there is no purpose in sending the issue back to the government for a further response to the Sixth Commission’s conclusion that the benefits issue should be considered by the Seventh Commission, and its recommendation that the Seventh Commission should be appointed in a timely manner. This is not a case where there is a range of reasonable options that the government could adopt if its Response were set aside. The only option available that will comply with the constitutionally mandated process for setting judicial remuneration and the principle of judicial independence is to allow the Seventh Commission to consider and report on the issue of the proposed benefit changes.

[73] Accordingly, I would quash the government’s Response respecting benefits and declare that the regulation and OIC implementing that part of the Response are unconstitutional. I would also grant an order prohibiting Ontario from proceeding with the implementation of the benefit changes until an independent commission has had an opportunity to consider and report on them.

The Motion to Set Aside Stewart J.’s Stay Order

[74] Ontario has brought a motion pursuant to s. 21(5) of the Courts of Justice Act, R.S.O. 1990, c. C. 43 to set aside the interlocutory order of Stewart J.

[75] This motion is moot, given the disposition of the application for judicial review with respect to the changes to the benefit plans. However, Ontario asks that this Court deal with the merits of the motion, as it raises an important issue with respect to the availability of interim injunctive relief against the government.

[76] Even if this Court were to exercise its discretion to hear the motion, I would dismiss the motion.

[77] On a motion to set aside or vary under s. 21(5), a panel of the Divisional Court does not hear the motion de novo. While Overseas Missionary Fellowship v. 578369 Ontario Ltd. (1990), 1990 6771 (ON CA), 73 O.R. (2d) 73 (C.A.) states that “by the use of ‘set aside or vary’ it was intended to give the panel all of the powers of the single judge with respect to the proper disposition of the motion”, the Court of Appeal does not say that the hearing is to be de novo. Indeed, to allow a full rehearing would be a waste of judicial resources, as this Court has stated in cases such as 3394603 Canada Incorporated v. Harman Transport, 2008 67404. Therefore, the panel should intervene only if there has been an error of law or a palpable and overriding error of fact by the motion judge.

[78] In the present case, the motion judge set out the governing legal principles from RJR- Macdonald Inc. v. Canada (Attorney General), 1994 117 (SCC), [1994] 1 S.C.R. 311, and she applied them correctly. On a fair reading of her reasons, she did not determine the merits of the constitutional issue when she concluded there was a serious issue to be determined on the application for judicial review.

[79] Nor did she err in finding irreparable harm to the Association if a stay were not granted. At this stage, a judge determines whether the harm caused to the moving party is irreparable if a stay is not granted. Ontario argues that any adverse financial impact from the introduction of the benefit plan could be calculated and reversed at its expense. However, the motion judge was concerned about an intangible harm if the stay were not granted - that is, the harm to the principle of judicial independence if the commission process were not respected (at para. 30). If the Association ultimately succeeded on the application, I agree that such harm is not compensable by monetary damages.

[80] The challenging issue in a motion such as this is the balance of convenience. Ontario correctly states that it is rare to order interim relief against the government so as to stay the operation of legislation, whether a statute or a regulation. Citing RJR (at p. 346), Ontario argues that there is a high hurdle for a litigant to show that the balance of convenience favours it in a constitutional case, given the public interest in the continued operation of a law enacted by a democratically elected legislature.

[81] I agree with Ontario’s submission that interim injunctive relief against the Crown is an extraordinary remedy when the province’s exercise of legislative authority is in issue. However, in the cases on which Ontario relies, including RJR at pp. 346-48, a litigant asserted a private interest and sought to stay the operation of legislation pending a constitutional challenge.

[82] In the present case, the Association asserts a public interest, as does the government. The Association framed the balance of convenience issue as one between the right of the executive branch to act as it thought fit versus the constitutionally protected independence of the justices of the peace as judicial officers. The motion judge saw the issue in this way, noting that both the Association and the government were asserting public interests (at para. 33). She considered the equities, including the monetary impact on the government of continuing with the status quo and the relatively short time necessary to bring this application for judicial review on for a hearing. Ultimately, she concluded that the balance of convenience favoured the preservation of the status quo.

[83] I see no error in law nor any palpable and overriding error of fact in her exercise of discretion to grant the stay in this very unusual case. There is no basis for this Court to set aside her order.

Conclusion

[84] For these reasons, the application for judicial review is granted in part. Ontario’s Response respecting benefits is quashed, and the regulation and OIC implementing that part of the Response are unconstitutional.

[85] An order shall issue prohibiting Ontario from proceeding with the implementation of the benefit changes until an independent Commission has had an opportunity to consider and report on them.

[86] The motion to set aside the order of Stewart J. is dismissed.

[87] If the parties cannot agree on costs, they shall make written submissions (limited to three pages by agreement of the parties) within 30 days of the release of this decision.

___________________________ Swinton J.

Sachs J.

Pattillo J.

Released: October 25, 2016