Rogers Communications Canada Inc. v. The Ontario Energy Board, 2018 ONSC 6314

Citation: Rogers Communications Canada Inc. v. The Ontario Energy Board, 2018 ONSC 6314 Divisional Court File No.: 255/18 Date: 2018-10-23

Superior Court of Justice – Ontario Divisional Court

Re: Rogers Communications Canada Inc., Bragg Communications Inc., Canadian Cable Systems Alliance, Cogeco Connexion Inc., Independent Telecommunications Providers Association, Zayo Canada Inc. (Formerly Allstream Inc.), Niagara Regional Broadband Network, Packet-Tel Corp. (O/A Packetworks), Québecor Média Inc., Shaw Communications Inc., Tbaytel, Telus Communications Inc., BH Telecom, Appellants/Moving Parties

And:

The Ontario Energy Board, Respondent

Before: Marrocco A.C.J.S.C.

Counsel: Timothy Pinos and Christopher Selby, for the Appellants M. Philip Tunley and Jennifer Saville, for the Respondent

Heard at Toronto: September 17, 2018

Motion for Directions Endorsement

[1] Because this matter will be heard by a panel of the Divisional Court, I will comment as little as possible about the issues involved.

[2] The Appellants/Moving Parties (all telecommunications companies) bring this proceeding to challenge the Ontario Energy Board’s (the Respondent, “OEB” or “Board”) action increasing the rates charged for “Pole Attachment Charges” (i.e., the rate that the Appellants pay to attach their overhead cables and wires to utility poles owned by Ontario electricity utilities). The utilities are also known as local distribution companies (“LDCs”).

[3] The Pole Attachment Charges were first set in 2005 by way of an order by the Respondent (RP-2003-0239, Decision and Order dated March 7, 2005). In 2015 the Respondent announced a policy review of the rates charged for Pole Attachments and the creation of a Pole Attachments Working Group (PAWG).

[4] Meetings of the PAWG, a report by an economic consultant (the “Nordicity Report”) and a Draft Report by the Respondent culminated in a Final Report which concluded that Pole Attachment Charges should be increased from $22.35 to $43.63.

[5] Immediately after the Respondent issued its Final Report on March 22, 2018 the Moving Parties filed a notice of appeal.

[6] While the Respondent disputes whether an appeal is available, the Notice of Appeal is helpful on this motion because it describes the issues that the Appellants will raise when this matter is heard by a panel of the Divisional Court. The Appellants describe the issues as follows:

• The Board failed to adhere to the process it set. This position maintains that the Respondent told everyone that this was a policy review of miscellaneous rates. There was no notice that this would be a typical rate setting exercise and, as a result, the Respondent erred in law by issuing the Final Report, including a new Pole Attachment Charge, which was outside of the scope of the Policy Review it had authorized, commenced, and defined.
• The Respondent set a Pole Attachment Charge following an informal Policy Review process without a proper hearing and notice as required by the Ontario Energy Board Act, 1998, S.O. 1998, c. 15, Sch. B (“OEB Act”), the OEB’s Rules of Practice and Procedure and established practice.
• The Appellants had a reasonable expectation, which the Respondent failed to meet, that a hearing would be held because the Respondent’s consistent, established and longstanding rate-setting process included an application, proper notice, the submission of evidence, interrogatories respecting that evidence and a hearing to test the evidence and interrogatory responses, leading to a final written or oral public hearing through an open, public and transparent process; all in front of a panel of adjudicators charged with the responsibility of making a final decision.
• The Respondent failed to require LDCs to meet “the burden of establishing that the rates are just and reasonable”, as is required pursuant to ss. 78(8) and 78(9) of the OEB Act. As a result, the Respondent also breached its own mandated process to establish just and reasonable rates, provided for in s. 78(3) of the OEB Act.
• The process adopted was outside of the Respondent’s jurisdiction.
• The Appellants claim that the Respondent failed to allow all stakeholders to be present in the Policy Review, as representatives were chosen to represent categorical interests. The Appellants were given notice of the consultation process, but only some had an opportunity to participate.
• Those Moving Parties participating in the Policy Review had no opportunity to present relevant evidence and test the evidence provided by the Respondent’s consultant, despite highly contentious factual and methodological issues.
• In the Final Report, the Respondent ignored virtually all (40 of 47) of the Moving Parties detailed legal, factual and process submissions with the result that it is not clear whether the Board members who approved the Final Report reviewed the Moving Parties’ submissions.

[7] The Moving Parties complaints, set out above, can be grouped as follows:

• complaints about the process that led to the Respondent’s Final Report,
• a complaint about the failure to apply the burden of proof borne by the LDCs, and
• a complaint that the Respondent ignored the Moving Parties’ submissions concerning its Final Report.

[8] The Notice of Appeal particularizes the Moving Parties' complaints about the process that led to the Final Report as follows;

• the process followed in arriving at the new Pole Attachment Charges was different than the process that the Respondent had told everyone it was going to follow;
• the process followed did not permit a proper hearing with proper notice;
• the process followed did not permit all stakeholders to participate in the rate setting,
• the process followed did not provide the Moving Parties with an opportunity to present evidence and test the evidence provided by the Nordicity Group (a consultant hired by the Respondent);
• the process followed failed to meet a reasonable expectation that the Moving Parties had as a result of the Respondents’ long-standing rate setting process; and
• the process followed was outside the Respondent’s jurisdiction.

[9] The Respondent maintains that in 2005 it issued a decision, further to an application by representatives of the Moving Parties, implementing the province-wide Pole Attachment Charge as a condition of all local electricity distribution companies licences pursuant to s. 74 of the OEB Act. As a result, the Respondent maintains that the Board’s power to amend the province-wide Pole Attachment Charge is now governed by s. 70(1.1) of the OEB Act, which explicitly provides:

s. 70(1.1) “The Board may, with or without a hearing, grant an approval, consent or make a determination that may be required for any of the matters provided for in a licensee’s licence. “

[10] On this motion the Moving Parties and the Respondent disagree on the contents of the Record which must be provided to the Divisional Court panel. Specifically, the Moving Parties request production of the following:

1. Who prepared the Draft Report (name(s) and position(s))?
2. Who (outside of any Board members) reviewed and/or approved the Draft Report prior to its release?
3. Disclosure of the documents provided to Board Members in respect of the Draft Report and copies of those documents not on the OEB web site.
4. Who prepared the Final Report (name(s) and position(s))?
5. In addition to the Draft Report, disclosure of the documents relied upon or used in preparation of the Final Report and copies of those documents not on the OEB’s website.
6. Which members of the Board reviewed and approved the Final Report?
7. Disclosure of the documents provided to the Board Members who approved the Final Report and copies of those documents not on the OEB web site.
8. Copies of written submissions or guidance to Board members prepared by Nordicity or any other third party including any summary or commentary on the submissions received not published on the Board web site.
9. Disclosure of oral presentations or submissions to Board members following the Draft Report prepared by Nordicity or any other third party as well as copies of any presentation material used, and any notes, recording or transcripts of oral presentations or submissions made.
10. Copies of correspondence concerning the Draft or Final Report between Nordicity and any other third party, Board staff or Board members, for the period between March 7, 2017 and March 22, 2018,

[11] There are statutory provisions that define the types of documents normally required in a Record of Proceedings, but those provisions do not assist in this case.

[12] The record was defined by Lord Denning in R v Northumberland Compensation Appeal Tribunal, (1951-52) 2 P. & C.R. 361 as follows:

“I think the record must contain at least the document which initiates the proceedings, the pleadings, if any, and the adjudication; but not the evidence, nor the reasons, unless the tribunal chooses to incorporate them. If the tribunal does state its reasons, and those reasons are wrong in law, certiorari lies to quash the decision.”

[13] Lord Denning spoke in a context in which judicial review was limited to ensuring that the tribunal had acted within its jurisdiction. Since then, judicial review has expanded to allow for reasonableness reviews. It follows that the record required needs to be fuller. This was recognized by the Saskatchewan Court of Appeal in Hartwig v. Saskatchewan (Commissioner of Inquiry), 2007 SKCA 74, at paragraphs 32-33:

“......I prefer to base my conclusion in this regard on the straightforward proposition that the parties to a judicial review application should be able to put before a reviewing court all of the material which bears on the arguments they are entitled to make.”

[14] I recognize that Ontario, unlike Saskatchewan, has legislation such as s. 20 of the Statutory Powers Procedure Act, R.S.O 1990, c. S.22 (“SPPA”), which defines the Record for purposes of administrative hearings. However, section 20 by its terms applies to a “proceeding in which a hearing has been held”. In this matter, the issue is joined, in part, on whether a hearing was required and therefore applying the definition in s. 20 is unhelpful.

[15] The Hartwig approach finds some support in Ontario. Specifically, in CCSAGE Naturally Green v. Director, Sec. 47.5 EPA, MNRF and OEB, 2018 ONSC 237, which was an application to judicially review decisions of the OEB, in which the Applicant requested “an order directing the Respondents to deliver further and better records of the proceedings which led to the impugned decisions.”

[16] The application judge refused the order but found that where the SPPA did not apply, the record was comprised of enough information to allow for meaningful judicial review of the impugned decisions. See CCSAGE Naturally Green v. Director, Sec. 47.5 EPA at para. 68.

[17] Applying the “meaningful judicial review test”, and quite apart from the claims of privilege or deliberative secrecy advanced by the OEB, I conclude the following concerning the Moving Parties’ specific requests:

[18] Items 1, 2, 4 and 6 seek the identities of persons who prepared, reviewed and approved the Draft Report and the Final Report.

[19] The identities of these individuals are not required to meaningfully consider the Moving Parties complaints about process, the failure to apply the burden of proof borne by LDCs or the Respondent’s failure to consider the Moving Parties Final Report submissions.

[20] Accordingly, the information described in these items need not be produced.

[21] Item 3 concerns documents provided to Board Members in respect of the Draft Report. The Draft Report was released to the Moving Parties prior to preparation of the Final Report. It was the Draft Report which first proposed a new increased province-wide Pole Attachment Charge. At that same time, the Respondent released the Nordicity Report, which supported the conclusions reached in the Draft Report. The Moving Parties had an opportunity to comment on the Nordicity Report and on the Draft Report. Their complaint is that their submissions were ignored.

[22] These documents, if there are any, are not required for a meaningful review of the Moving Parties’ complaints about process, the failure to apply the burden of proof borne by LDCs or their complaint that their submissions were ignored.

[23] Accordingly, these documents need not be produced.

[24] Item 5 concerns documents relied upon or used in preparation of the Respondent’s Final Report.

[25] A meaningful review of the Moving Parties’ complaints about the Respondent’s process does not require these documents. The process that the Respondent followed is known; the Moving Parties’ position is that it is objectionable. A meaningful review of the Moving Parties’ submissions concerning process can be achieved without these documents.

[26] A comparison of the contents of the Final Report and the Moving Parties’ submissions made subsequent to publication of the Draft Report will permit a meaningful review of whether the Moving Parties’ submissions were ignored.

[27] Finally, a meaningful review of a complaint about the failure to apply the burden of proof to the LDCs requires a consideration of the Final Report, not the documents used in preparation of that report.

[28] Accordingly, the documents described in item 5 are not required for a meaningful review of the Moving Parties’ complaints and need not be produced.

[29] Item 7 seems to be a particularization of item 5. Item 5 asks for the disclosure of documents relied upon or used in preparation of the Final Report; item 7 asks for documents provided to Board members who approved the Final Report.

[30] The documents described in item 7 need not be produced for the same reason that the documents described in item 5 are not required.

[31] Item 8 concerns submissions or guidance to OEB members by the Nordicity Group or any other third party. Such submissions or guidance, if it exists, is not required for a meaningful review of the moving parties’ complaints about process. If such submissions or guidance suggested to Board members that they ignore the Moving Parties’ submissions concerning the Final Report, it would not assist in a meaningful review of whether it was appropriate to ignore those submissions.

[32] Finally, such submissions or guidance is not required for a meaningful review of the Respondent’s alleged failure to apply the burden of proof to LDCs.

[33] Accordingly, the submissions or guidance referred to in item 8 are not required for a meaningful review of the Moving Parties’ complaints.

[34] Item 9 seeks the disclosure of oral presentations or submission to the Board members following the publication of the Draft Report. The oral presentations or submissions are not required for a meaningful review of the Moving Parties complaints about process or their complaint about the fact that there submissions concerning the Final Report were ignored.

[35] Finally, a meaningful review of a complaint about the failure to apply the burden of proof to the LDCs can be achieved by consideration of the Final Report.

[36] The oral presentations or submissions, if there were any, are not required.

[37] Item 10 seeks two types of correspondence: correspondence concerning the Draft Report and correspondence concerning the Final Report. As indicated, the Moving Parties were able to comment on the Draft Report.

[38] Accordingly correspondence concerning the Draft Report need not be produced.

[39] Correspondence concerning the Final Report is not required for a meaningful review of the Moving Parties complaints about process or their complaint that there submissions were ignored or their complaint about the failure to apply the burden of proof borne by LDCs.

[40] Accordingly, correspondence concerning the Final Report is also not producible.

Conclusion

[41] The Moving Parties’ motion for disclosure and production is dismissed with costs. If the parties cannot agree on the costs, each side can make submissions not exceeding two pages on the quantum of costs within ten days of release of this decision.

[42] The parties will have 45 days from the release of this decision to perfect this matter.

MARROCCO A.C.J.S.C.

Date: 20181023