Blue Star Trailer Rentals Inc. v. 407 ETR Concession Co.
91 O.R. (3d) 321
Court of Appeal for Ontario,
O'Connor A.C.J.O., Doherty and Gillese JJ.A.
July 16, 2008
Highways -- Interpretation -- "Vehicle" -- Trailer constituting "vehicle" for purposes of s. 13(1) of Highway 407 Act -- Towed trailer "operated" for purposes of s. 13(1) -- Trailer rental company properly charged tolls for trailers on toll highway -- Highway 407 Act, 1998, S.O. 1998, c. 28, s. 13(1).
The appellant is the operator of an electronic toll highway. The process by which it can collect tolls is set out in the Highway 407 Act, 1998 (the "Act"). Section 13(1) of the Act provides that a toll shall be paid by (a) if a toll device is not affixed to the vehicle, the person in whose name the plate portion of the vehicle is issued; (b) if the toll device is affixed to the vehicle, the person to whom the toll device is registered. On an application by the respondent trailer rental company, the application judge found that a trailer is not a "vehicle" for the purposes of s. 13(1) of the Act and declared that the appellant did not have the statutory authority to toll trailers where the registered owner of the plate portion of the trailer permit is not the same as the registered owner of the plate portion of the permit of the motor vehicle pulling the trailer. The appellant appealed.
Held, the appeal should be allowed.
The application judge erred in finding that a trailer is not a "vehicle" for the purposes of s. 13(1) of the Act. The Act does not define "vehicle" or "trailer". There is nothing in the language of s. 13 to preclude the term "vehicle" from including a trailer. The Act is closely related to and part of the broader legislative scheme regulating the use of highways in the Province of Ontario. The primary statute within that scheme is the Highway Traffic Act, R.S.O. 1990, c. H.8. The two statutes are intended to be read together. The words "trailer" and "vehicle" are defined in the HTA. In s. 1(1) of the HTA, "vehicle" is defined to include a trailer. Because the Act is a component of the larger statutory scheme in the HTA, there is a presumption that the words in the two statutes, and in particular the words that are dealing with the same subject matter, are used harmoniously, coherently and consistently. That presumption strongly supports the conclusion that the words "vehicle" and "trailer" have the same meaning in the two statutes and that, therefore, the word "vehicle" in s. 13 includes a trailer. Finally, an interpretation of s. 13(1) of the Act which includes a trailer within the meaning of the word "vehicle" is consistent with the purpose of providing the appellant with an effective means of collecting tolls, and an interpretation that does not include trailers would result in an incomplete and ineffective system of toll collection. It is reasonable to conclude that the legislature intended that all users of the highway pay for its use.
Section 13(1) requires the payment of a toll for the "operation of a vehicle" on the highway. Once one concludes that a vehicle includes a trailer, it follows that the word "operation" should be given an expansive interpretation, so that a trailer that is being towed is being "operated" within the meaning of the section. To hold otherwise would render the interpretation that a vehicle includes a trailer meaningless.
The application judge erred in granting the respondent an accounting. [page322]
APPEAL from the decision of Allen J. (2008), 2008 3422 (ON SC), 89 O.R. (3d) 333, [2008] O.J. No. 409 (S.C.J.), granting an application for a declaration and accounting.
Cases referred to 407 ETR Concession Co. v. Ontario (Registrar of Motor Vehicles) (2005), 2005 49963 (ON SCDC), 82 O.R. (3d) 703, [2005] O.J. No. 4830, 29 M.V.R. (5th) 62 (Div. Ct.); Bell ExpressVu Limited Partnership v. Rex, [2002] 2 S.C.R. 559, [2002] S.C.J. No. 43, 2002 SCC 42, 212 D.L.R. (4th) 1, 287 N.R. 248, [2002] 5 W.W.R. 1, J.E. 2002-775, 166 B.C.A.C. 1, 100 B.C.L.R. (3d) 1, 18 C.P.R. (4th) 289, 93 C.R.R. (2d) 189, 113 A.C.W.S. (3d) 52, REJB 2002-30904; Canadian Pacific Airlines Ltd. v. Canadian Air Line Pilots Assn., 1993 31 (SCC), [1993] 3 S.C.R. 724, [1993] S.C.J. No. 114, 108 D.L.R. (4th) 1, 160 N.R. 321, J.E. 93-1815, 17 Admin. L.R. (2d) 141, 93 CLLC Â14,062 at 12372, 43 A.C.W.S. (3d) 396; Housen v. Nikolaisen, [2002] 2 S.C.R. 235, [2002] S.C.J. No. 31, 2002 SCC 33, 211 D.L.R. (4th) 577, 286 N.R. 1, [2002] 7 W.W.R. 1, J.E. 2002-617, 219 Sask. R. 1, 10 C.C.L.T. (3d) 157, 30 M.P.L.R. (3d) 1, 112 A.C.W.S. (3d) 991; R. v. Zeolkowski, 1989 72 (SCC), [1989] 1 S.C.R. 1378, [1989] S.C.J. No. 50, 61 D.L.R. (4th) 725, 95 N.R. 149, [1989] 4 W.W.R. 385, J.E. 89-827, 58 Man. R. (2d) 63, 50 C.C.C. (3d) 566, 69 C.R. (3d) 281, 8 W.C.B. (2d) 459 Statutes referred to Capital Investment Plan Act, 1993, S.O. 1993, c. 23 Highway 407 Act, 1998, S.O. 1998, c. 28, ss. 13, (1), 14, (1), 17, 18, 19, 22, 41, (1) Highway Traffic Act, R.S.O. 1990, c. H.8, Parts VI, X.1, ss. 1(1) [as am.], 7 [as am.], (4), 10(2), 62(24), 64(5), 69(1), 109(8), 191.1, 191.2(1), (2), 191.3(1) Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 14.05(3) [as am.] Toll Devices, O. Reg. 147/97 (Highway Traffic Act, R.S.O. 1990, c. H.8) Authorities referred to Driedger, E.A., Construction of Statutes, 2nd ed. (Toronto Butterworths, 1983) Sullivan, Ruth, Sullivan and Driedger on the Construction of Statutes, 4th ed. (Markham, Ont.: Butterworths Canada Ltd., 2002)
J. Thomas Curry and Emily McKernan, for appellant. William A. Chalmers and Hilary C. Book, for respondent.
The judgment of the court was delivered by
[1] O'CONNOR A.C.J.O.: -- This appeal raises the issue whether the appellant, 407 ETR Concession Company Limited ("407 ETR"), is statutorily entitled to charge a toll to the owner of a trailer where the trailer is pulled on Highway 407 by a motor vehicle owned by a person other than the owner of the trailer.
[2] The outcome of this appeal turns on the interpretation of the word "vehicle" in s. 13(1) of the Highway 407 Act, 1998, S.O. 1998, c. 28 ("407 Act"). Section 13(1) reads as follows: [page323]
13(1) A toll and any related fee and interest payable under this Act for the operation of a vehicle on Highway 407 shall be paid to the owner by, (a) if a toll device is not affixed to the vehicle, the person in whose name the plate portion of the vehicle is issued; (b) if the toll device is affixed to the vehicle, the person to whom the toll device is registered.
[3] Specifically, the issue is whether the word "vehicle" in s. 13(1) includes a trailer so that 407 ETR is entitled to charge a toll to the person in whose name the vehicle permit of a trailer is issued. Facts (a) Highway 407
[4] The 407 Express Toll Route ("Highway 407") is an important element of the highway transportation system in Ontario. It is the world's first all-electronic, open-access toll highway, meaning that persons who use Highway 407 may access it without paying a toll at the point of entry or exit. Rather, users of Highway 407 are tolled electronically and the registered owner of the vehicle is invoiced at a later date.
[5] When the highway was first opened in 1997, it was operated by a Crown corporation. In May 1999, the province privatized Highway 407. 407 ETR became the operator of the highway.
[6] In order to facilitate the privatization, the province enacted the 407 Act. This legislation designated Highway 407 as a private toll highway, authorized its sale and set out the terms and conditions of its continued operation.
[7] 407 ETR has continued to operate, and is required to continue to operate, Highway 407 as an all-electronic, open- access toll highway. Given its open character, no one is prevented from gaining access to and using Highway 407. Users of Highway 407 fall into two categories: those who use a toll device and those who do not.
[8] Toll devices are electronic devices that are attached to the front windshield of a vehicle and are read by scanners on overhead gantries upon entry and exit from Highway 407. Users of vehicles on Highway 407, other than heavy vehicles, are free to decide whether to use a toll device or not.
[9] Pursuant to the Highway Traffic Act, R.S.O. 1990, c. H.8 and its regulations, heavy vehicles (i.e., those weighing more than 5,000 kg) must have a toll device in order to travel on Highway 407. The failure of a heavy vehicle to have a toll device is an offence punishable under the Highway Traffic Act. [page324]
[10] When users of Highway 407 do not have toll devices, overhead digital cameras photograph the rear licence plates of their vehicles at the points of entry and exit from Highway 407. During the time that the province owned and operated Highway 407 and after privatization, the roadside tolling system for the highway has always been a rear-plate camera system. 407 ETR says that it would have to undertake significant changes to the tolling system now in place to take front-plate photographs.
[11] The 407 Act sets out a collection process by which 407 ETR can collect tolls. [See Note 1 below] It can send invoices either to the person to whom a toll device is registered or to the person in whose name the plate portion of the vehicle permit (the rear licence plate) is issued. The process also includes a licence plate denial system for those who do not pay tolls for which ETR bills them. [See Note 2 below]
[12] Where a person disputes that tolls are owed to 407 ETR, the 407 Act places the onus for disputing payment and showing that the toll is not owed on the recipient of a notice of failure to pay. [See Note 3 below] (b) Blue Star
[13] Blue Star is a trailer rental company that rents out commercial, highway and cartage trailers. The problem underlying this appeal results from situations where tractor drivers towing Blue Star trailers avoided toll charges by having a toll device in place on the windshield upon entering Highway 407 and removing the toll device before exiting. This practice resulted in 407 ETR being unable to match entry times and locations with exit times and locations.
[14] When the situation described in the above paragraph occurred prior to July 2007, 407 ETR's practice was to charge the tractor a minimum trip toll covering the distance from where the tractor entered Highway 407 to the next closest entry or exit. In addition, 407 ETR would charge the person in whose name the plate portion of the vehicle permit was issued (in this case, Blue Star) a toll for a trip from where the photograph of the plate was taken to the next closest entry or exit.
[15] Pursuant to the above practice, 407 ETR billed Blue Star for tolls for approximately 845 trips during the period from 1998 to July 2007. Blue Star did not pay the ETR invoices nor did it [page325] take any formal steps to dispute its liability to pay such amounts or the amounts charged. From time to time, Blue Star did return invoices to 407 ETR.
[16] Further, Blue Star made no effort to prevent its customers from using Highway 407 nor to recover the amounts charged by 407 ETR from its customers. Blue Star did not advise its customers that they would be responsible for Highway 407 charges nor did it deliver the invoices to its customers which included these charges.
[17] By Notice of Application dated October 10, 2007, Blue Star sought, inter alia, a declaration that it was not liable to pay the tolls charged by 407 ETR in the circumstances described above. Blue Star also sought an accounting of all the amounts charged to it by 407 ETR for the use of Highway 407. The Application Judge's Decision
[18] The application judge accepted Blue Star's argument that s. 13(1) only permits 407 ETR to charge tolls to motor vehicles and not to trailers, at least when the registered owner of the motor vehicle plate differs from the registered owner of the trailer plate.
[19] The application judge arrived at this conclusion based on the following reasoning:
(a) She began her analysis with s. 13(1)(b). She found that if a toll device is affixed to a vehicle, the person to whom the toll device is registered is required to pay Highway 407 tolls and other charges;
(b) to interpret the word "vehicle" (which is not defined in the 407 Act), she reasoned one must have regard to the Highway Traffic Act, which is a related statute;
(c) reading ss. 191.2(1) and 191.3(1) of the Highway Traffic Act, together with O. Reg. 147/97 made under the Highway Traffic Act (the "Regulation"), she concluded that the word "vehicle" in s. 13(1)(b) of the 407 Act cannot refer to a "trailer" because the Highway Traffic Act and the Regulation read together require a toll device to be affixed to the windshield of a vehicle, and trailers do not have windshields. Accordingly, the word "vehicle" in s. 13(1)(b) must be interpreted to mean "motor vehicle";
(d) she went on to reason that if "vehicle" in s. 13(1)(b) should be interpreted to mean "motor vehicle", then it cannot include a trailer because the definitions of "trailer", "vehicle" [page326] and "motor vehicle" under the Highway Traffic Act make it clear that a "trailer" and a "motor vehicle" are not the same thing;
(e) if the word "vehicle" in s. 13(1)(b) means "motor vehicle", then the principle of consistent expression requires that this same meaning also be attributed to the word "vehicle" in s. 13(1)(a);
(f) the application judge held that this interpretation was not contrary to the legislation's purpose. Those who abuse the open access highway can be penalized by the Highway Traffic Act's compliance provisions. It is not reasonable for 407 ETR to levy tolls to extend so far as to defeat these compliance provisions by billing trailer owners when tractor drivers evade tolls; and
(g) she also held that the consequence of the contrary interpretation would be to pass on to the respondent some of the costs of the tractor drivers' non-compliance with the law. She noted, "[t]he drafters cannot have meant that persons who manage to evade the law and the reach of the toll system should be able to avoid paying while those who can more conveniently be charged are required to pay".
[20] As a result, the application judge made a declaration that 407 ETR does not have the statutory authority to toll trailers where the registered owner of the plate portion of the trailer permit is not the same as the registered owner of the plate portion of the permit of the motor vehicle pulling the trailer. The application judge went on to grant Blue Star the equitable remedy of an accounting for amounts charged by 407 ETR to Blue Star. Issues (1) Did the application judge err in concluding that a trailer is not a "vehicle" for the purposes of s. 13(1) of the 407 Act? (2) If so, were Blue Star's trailers "operated" on Highway 407 within the meaning of s. 13(1)? (3) Did the application judge err in ordering an accounting by the appellant of all amounts charged to the respondent for use of Highway 407 by any of the respondent's trailers attached to a motor vehicle where the motor vehicle was not owned by the respondent? [page327]
Issue #1 -- Is a trailer a vehicle?
[21] The interpretation of s. 13(1) is a question of law and as such this court should review the application judge's decision on a standard of correctness: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, [2002] S.C.J. No. 31, at para. 8.
[22] The Supreme Court of Canada has repeatedly endorsed Driedger's approach to statutory interpretation. Driedger's modern principle [as found in Construction of Statutes, 2nd ed.] is as follows:
Today there is only principle or approach, namely, the words of an Act are to be read in their entire context, in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and intention of Parliament. Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559, [2002] S.C.J. No. 43, at para. 26.
[23] This approach to statutory interpretation -- sometimes referred to as the textual, contextual or purposive approach -- requires an examination of three factors: the language of the provision, the context in which the language is used and the purpose of the legislation or statutory scheme in which the language is found.
[24] When applying this approach, it makes sense to start by examining the ordinary meaning or meanings of the words being interpreted. The ordinary meaning is "the natural meaning which appears when the provision is simply read through": Canadian Pacific Airlines Ltd. v. Canadian Air Line Pilots Assn., 1993 31 (SCC), [1993] 3 S.C.R. 724, [1993] S.C.J. No. 114, at p. 735 S.C.R., cited in Ruth Sullivan, Sullivan and Driedger on the Construction of Statutes, 4th ed. (Markham, Ont.: Butterworths Canada Ltd., 2002), at p.21.
[25] After considering the ordinary meaning of the language involved, the court should consider the context in which the language is found as well as the purpose of the legislation or the statutory scheme. If this analytical approach yields a plausible interpretation then the court need go no further and should adopt that interpretation. It is only when there remains genuine ambiguity between reasonable interpretations that the court should resort to other principles of statutory interpretation: see Bell ExpressVu, at para. 29.
Application to this case (a) Ordinary meaning
[26] For ease of reference, I repeat the language of s. 13(1) of the 407 Act: [page328]
13(1) A toll and any related fee and interest payable under this Act for the operation of a vehicle on Highway 407 shall be paid to the owner by, (a) if a toll device is not affixed to the vehicle, the person in whose name the plate portion of the vehicle is issued; (b) if a toll device is affixed to the vehicle, the person to whom the toll device is registered.
[27] I begin by noting that the 407 Act does not define either a "vehicle" or a "trailer". It seems to me that simply reading s. 13(1) through does not shed much light on whether or not a "vehicle" is intended to include a trailer. Used expansively, a vehicle could refer to "any conveyance for transporting people, goods, etc., esp. on land": Canadian Oxford Dictionary, 2nd ed., s.v. "vehicle". Such a broad definition would include a trailer.
[28] On the other hand, more narrowly interpreted, "vehicle" may refer only to a motorized or self-propelled conveyance. Indeed, the respondent argues that the reference to the "operation" of a vehicle in s. 13(1) suggests that the vehicle in question is a self-propelled vehicle, not a trailer; motor vehicles are actively operated, whereas trailers are passively towed.
[29] While that is one possible interpretation, I think that it is equally plausible that the phrase "operation of a vehicle" could refer to the use or towing of a trailer. I do not think the phrase "operation of a vehicle" lends much force to one interpretation or the other.
[30] In reaching the conclusion that the word "vehicle" in s. 13 should be given a narrow interpretation, the application judge started her analysis by looking to s. 13(1)(b) which refers to tolls being payable "if a toll device is affixed to a vehicle". The application judge reasoned that because a toll device must be affixed to the windshield of a vehicle pursuant to the provisions of the Regulation, and trailers do not have windshields, the word "vehicle" could not be interpreted to include a trailer.
[31] With respect, the flaw in this reasoning is that s. 13(1)(b) does not require that toll devices be affixed to all vehicles. Moreover, s. 13(1)(a) refers to the situation where a toll device is not affixed to a vehicle. Thus, on reading s. 13(1) as a whole, the word "vehicle" in the section could include both a conveyance with a toll device and a conveyance without one.
[32] In my view, there is nothing in the language of s. 13 to preclude the term "vehicle" from including a trailer. Because the language of s. 13(1) does not help a great deal in determining whether the word "vehicle" in s. 13(1) includes a trailer, this is a case in which the context in which the word is used and the purpose of the legislation are particularly important in the interpretative analysis. [page329] (b) Context
[33] I am satisfied that the context in which the word "vehicle" is used in s. 13(1) points strongly to an interpretation that includes a trailer. The context to which I refer is the statutory scheme that emerges from reading the 407 Act together with the Highway Traffic Act as well as the other provisions of the 407 Act itself.
[34] In Bell ExpressVu, Iacobucci J., speaking for the Supreme Court of Canada, referred to the importance of considering not only the statutory scheme of the Act in which the provision in issue is found but also the statutory scheme of related statutes. At para. 27, he said:
The preferred approach recognizes the important role that context must inevitably play when a court construes the written words of a statute: as Professor John Willis incisively noted in his seminal article "Statute Interpretation in a Nutshell", "words, like people, take their colour from their surroundings". This being the case, where the provision under consideration is found in an Act that is itself a component of a larger statutory scheme, the surroundings that colour the words and the scheme of the Act are more expansive. In such an instance, the application of Driedger's principle gives rise to what was described in R. v. Ulybel Enterprises Ltd., as "the principle of interpretation that presumes a harmony, coherence, and consistency between statutes dealing with the same subject matter". (Citations omitted)
[35] The 407 Act is closely related to and part of the broader legislative scheme regulating the use of highways in the province of Ontario generally. The primary statute within this scheme is the Highway Traffic Act.
[36] While the 407 Act relates to a specific privately owned highway, that highway is connected to the public highway system of Ontario and is accessible to the public generally. The same people who use the publicly owned highways in Ontario can also use Highway 407 if they are prepared to pay for its use. One of the purposes of creating Highway 407 was to relieve congestion on the public highways of the province.
[37] The connection between the two statutes -- the 407 Act and Highway Traffic Act -- becomes apparent from a reading of the 407 Act. One need go no further than s. 13(1) to see that the two statutes are intended to be read together.
[38] Section 13 places the obligation to pay tolls for use of Highway 407 on two groups of persons. The members of each group can be determined only by referring to the Highway Traffic Act. The first group includes a person in whose name a toll device affixed to a vehicle is registered. The 407 Act does not define a "toll device" nor does it include many of the provisions regulating [page330] the use of toll devices. The toll device scheme envisioned by s. 13 of the 407 Act is to a large extent contained in the Highway Traffic Act and its regulations.
[39] Part X.1 of the Highway Traffic Act is entitled "Toll Highways". In s. 191.1 of the Highway Traffic Act "toll highway" is defined to include Highway 407 as defined in the 407 Act. Section 191.2(2) provides that a validated toll device is a toll device validated under the Capital Investment Plan Act, 1993, S.O. 1993, c. 23 or toll device that is validated under the 407 Act. The interconnection between the two statutes as they relate to toll devices is clear.
[40] The second category of persons required to pay tolls pursuant to s. 13 of the 407 Act are persons in whose names the plate portions of the permits are issued. The reference to the plate portion of the permit is to a vehicle permit required by s. 7 of the Highway Traffic Act. One can only interpret and apply s. 13 of the 407 Act by referring to the Highway Traffic Act.
[41] In the same vein, s. 41 of the 407 Act, which addresses vehicle licensing and safety on Highway 407, adopts the laws that apply to public highways in Ontario. These include a number of provisions in the Highway Traffic Act. [See Note 4 below]
[42] The words "trailer" and "vehicle" are defined in the Highway Traffic Act. Significantly, in s. 1(1) of that Act, "vehicle" is defined to include a "trailer".
[43] Because the 407 Act is a component of the larger statutory scheme in the Highway Traffic Act, there is a presumption that the words in the two statutes, and in particular the words that are dealing with the same subject matter, are used harmoniously, coherently and consistently: Bell ExpressVu, at para. 27.
[44] That presumption strongly supports the conclusion that the word "vehicle" and "trailer" have the same meaning in the two statutes and that, therefore, the word "vehicle" in s. 13 includes a trailer.
[45] This same interpretation results when one reads s. 13 in the context of other provisions of the 407 Act. Although the word "vehicle" is not defined in the 407 Act, it is used in several sections other than s. 13. There is a presumption that the legislature uses language carefully and consistently within a statute so that the same words have the same meaning each time they are used in the Act: see Sullivan, at 162-64 and R. v. Zeolkowski, 1989 72 (SCC), [1989] 1 S.C.R. 1378, [1989] S.C.J. No. 50, at p. 1387 S.C.R.
[46] As mentioned above, in s. 41, the term "vehicle" is used in the context of vehicle licensing and safety. Section 41(1) provides [page331] "for the purpose of enforcing vehicle licensing and safety standards under any Act, the Minister of Transportation shall treat Highway 407 as if it were part of the King's Highway".
[47] The Highway Traffic Act has specific provisions governing the licensing and safety standards for trailers. [See Note 5 below] In the context of s. 41, it is reasonable to presume that the legislature did not intend to limit the term "vehicle" to a motor vehicle. To do so would exclude trailers which are used on Highway 407 from the licensing and safety standards that apply to them when they are used on all other highways. It seems reasonable that the legislature intended the word "vehicle" in s. 41 to include a trailer.
[48] Further, the use of the word "vehicle" in s. 14(1) of the 407 Act also supports the argument for a broad interpretation. Section 14(1) provides the owner of Highway 407 with very broad authority to establish, collect and enforce payment of tolls. In part, it reads as follows:
14(1) Subject to subsection (2), the owner may (a) establish, collect and enforce payment of tolls with respect to the operation of any vehicle or class of vehicles on Highway 407; . . . . . (d) exempt any vehicle or class of vehicles from the application of s. 13. ... (Emphasis added)
[49] It is significant that s. 14(1) authorizes 407 ETR to charge tolls and fees in respect of any vehicle or class of vehicles. The use of this language shows an intention to provide as broad a right as possible to charge tolls and fees.
[50] Sections 13 and 14 are closely linked. Section 14 provides 407 ETR with the powers to collect and enforce payment of tolls and s. 13 describes who has the obligation to pay those tolls. It would make little sense to provide a broad authority to charge and collect tolls in one section but take a more restrictive approach to who is required to pay those tolls in a connected section. (c) Purpose
[51] The third factor to be considered as part of the statutory interpretative exercise is the purpose of the provision. Again, in my view, when one considers the purpose of s. 13, the term "vehicle" should be interpreted to include a trailer. [page332]
[52] The purpose of the 407 Act was to privatize the operation of Highway 407 and permit open access to Highway 407 from public highways. An integral part of the scheme in the Act was to provide the owner of Highway 407 with an effective method of collecting tolls from those who use the highway: see 407 ETR Concession Co. v. Ontario (Registrar of Motor Vehicles) (2005), 2005 49963 (ON SCDC), 82 O.R. (3d) 703, [2005] O.J. No. 4830 (Div. Ct.), at para. 27.
[53] An interpretation of s. 13(1) which includes a trailer within the meaning of the word "vehicle" is consistent with the purpose of providing ETR with an effective means of collecting tolls.
[54] Light vehicles (i.e., those under 5,000 kg) pulling trailers, are not required to have toll devices. When a tractor pulls a trailer, the tractor's rear licence plate is generally obscured from view. Thus, if one were to adopt an interpretation that a vehicle does not include a trailer, 407 ETR would have no way of collecting a toll when a light vehicle without a toll device pulls a trailer on Highway 407. 407 ETR would not be able to toll the trailer, nor would the driver of the light vehicle be at risk of being penalized under the Highway Traffic Act.
[55] In addition, where heavy vehicles, including tractor- trailers, fail to use a toll device (as in the circumstances involved in this appeal), the only way that 407 ETR can collect its tolls for the use of Highway 407 is to charge the person in whose name the plate portion of the vehicle permit (in this case the trailer permit) is issued.
[56] Thus, an interpretation that vehicles do not include trailers would result in an incomplete and ineffective system of toll collection. It is reasonable to conclude that the legislature intended that all users of the highway pay for its use.
[57] The respondent argues that these problems could be overcome if ETR modified its equipment to photograph front licence plates. While that may be possible, it is important when interpreting s. 13 to look at the circumstances in which it was enacted. The evidence on this application shows that the tolling system now in place -- photographing rear plates only -- is the same tolling system that was in place when the government owned and operated Highway 407 and when it enacted the 407 Act.
[58] The issue here is not whether 407 ETR could operate a system which photographed front licences plates. The issue is the interpretation of the word "vehicle" in s. 13 of the 407 Act. Given that the province enacted the legislation at a time when it was selling the rear-licence-plate photography system, it is not unreasonable to assume that the legislation, which was enacted at that time, was intended to apply to that system. I do not think the fact [page333] that the system could be modified to allow photographing of front plates adds anything to the interpretative analysis.
[59] The application judge held that the interpretation that a vehicle includes a trailer would not accord with the purposes of the legislation. While she recognized that one purpose of the Act is to give 407 ETR broad powers to levy charges for any and all vehicles that use Highway 407, she went on to reason that "[i]t would not seem reasonable, or in accord with the purpose of the legislation, for the respondent's broad authority to levy tolls against any vehicle to extend as far as to defeat the compliance provisions by billing trailer owners when tractor drivers pulling trailers evade the toll system": para. 50.
[60] I do not agree that permitting 407 ETR to levy tolls against trailers would somehow defeat the compliance provisions relating to toll devices in the Highway Traffic Act. The notion that a party who did not actually drive on the highway may be responsible for paying the tolls is not incompatible with a requirement that a heavy-vehicle operator have a toll device. In cases where a heavy-vehicle operator breaches the law, it may be prosecuted. There is nothing inconsistent in allowing 407 ETR to charge the toll to the trailer owner in this instance. The trailer owner is well positioned to pass the cost, if it sees fit, to its customer who leased or otherwise obtained permission to use the trailer.
[61] Thus, I am satisfied that an interpretation that permits 407 ETR to bill trailer owners is entirely consistent with the purposes of the 407 Act in that it provides 407 ETR with an effective means of collecting tolls. (d) Summary
[62] In summary, I conclude that a proper interpretation of s. 13(1) of the 407 Act is that a "vehicle" includes a trailer.
Issue #2 -- Were Blue Star's trailers "operated" on Highway 407?
[63] Section 13(1) requires the payment of a toll "for the operation of a vehicle" on Highway 407 (emphasis added). The question arises whether a trailer that is being towed is being operated within the meaning of the section. One could take an expansive view of what constitutes operating (i.e., being towed) or a narrow view (i.e., being driven).
[64] However, once one concludes that a vehicle includes a trailer, it seems to follow that the word "operation" should be given the expansive interpretation. To hold otherwise would render [page334] the broader interpretation that a vehicle includes a trailer meaningless.
[65] While the language in the Highway Traffic Act (in the main) is not helpful one way or the other, s. 69(1) does suggest that the word "operate" refers to trailers.
Issue #3 -- The accounting
[66] Having concluded that Blue Star was not liable for the use of Highway 407, the application judge ordered "an accounting and refund of all amounts charged by [407 ETR] to [Blue Star] for the use of Highway 407 by any trailer attached to a motor vehicle where the motor vehicle's licence plate is not issued in the name of [Blue Star], together with interest": para. 64.
[67] Before granting Blue Star an accounting, the application judge recognized that "parties should not be encouraged, as [Blue Star] has done, to sit on their rights". However, the application judge balanced that against other factors, including the fact that Blue Star "did not control the use of Highway 407 [by its trailers] and hence the charges that resulted from the tractors' use". She held that the "equities of the situation" favoured Blue Star. In my view, the order directing an accounting should be set aside. I do not agree with the application judge that Blue Star did not have control over the disputed charges for the use of its vehicles on Highway 407. 407 ETR billed Blue Star on a regular and ongoing basis. Blue Star did not take any formal steps to dispute its liability nor did it attempt to either restrict its customers' use of its trailers on Highway 407 or to recover the amounts it was being charged from its customers.
[68] Moreover, as the application judge pointed out, an accounting is an equitable remedy. In my view, two factors weigh heavily against ordering an accounting in the circumstances of this case. The first is delay. Blue Star has known for many years that 407 ETR was billing it as a result of its trailers being used on Highway 407. Prior to instituting the application that underlies this appeal, it did not take any steps to dispute its liability for such amounts. Its delay in doing so weighs against granting an equitable remedy.
[69] The second factor is that Blue Star did not avail itself of the provisions in the 407 Act which provide a statutory scheme to address disputes with respect to amounts that 407 ETR claims to be owing: see ss. 17-19 of the 407 Act. The legislature has specifically provided a process for addressing the same issues that would be dealt with in an accounting. The availability of an alternative remedy -- in this case a statutory remedy -- militates against the need to invoke equity. [page335]
[70] In the result, I am satisfied that the application judge's order for an accounting should be set aside. Given this conclusion, it is not necessary to decide whether an accounting was available in the circumstances of this proceeding, which was brought pursuant to rule 14.05(3) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
Disposition
[71] I would allow the appeal and set aside the orders made by the application judge. I would direct Blue Star to pay 407 ETR's costs of the appeal and of the proceeding below in the amount of $25,000, inclusive of disbursements and GST. I have reduced the appellant's claim for costs somewhat having regard to the fact that the underlying application raised a serious issue of statutory interpretation and was one that had not been previously decided by the courts.
Appeal allowed.
Notes
Note 1: Throughout, I use the term tolls when referring to tolls and fees that 407 ETR may charge under the 407 Act.
Note 2: Section 22 of the 407 Act.
Note 3: Section 17 of the 407 Act.
Note 4: See e.g., Part VI of the Highway Traffic Act relating to equipment.
Note 5: See e.g., ss. 7(4), 10(2), 62(24), 64(5) and 109(8).