Court of Appeal for Ontario

COURT OF APPEAL FOR ONTARIO DATE: 20241101 DOCKET: COA-24-CV-0071

Roberts, Copeland and Dawe JJ.A.

BETWEEN

Liquor Control Board of Ontario Applicant (Respondent)

and

Information and Privacy Commissioner of Ontario* and Toronto Star Respondents (Appellant*)

Counsel: William S. Challis, for the appellant, Information and Privacy Commissioner of Ontario M. Jill Dougherty and Kelsey L. Ivory, for the respondent

Heard: October 24, 2024

On appeal from the order of the Divisional Court (Associate Chief Justice Faye E. McWatt, Justice J. Paul R. Howard and Justice Nancy L. Backhouse, dissenting), dated August 10, 2023, with reasons reported at 2023 ONSC 4607.

Reasons for Decision

Overview

[1] This appeal arises out of a request for information under the Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c. F.31 (“FIPPA”). In January 2019, two staff reporters from the Toronto Star requested that the respondent Liquor Control Board of Ontario (“the LCBO”) disclose the following records (“the requested records”):

1. The total annual number of recorded incidents of theft/shoplifting from the LCBO province-wide, 2008 to present; and
2. For each LCBO location in Toronto, the total number of recorded incidents of theft/shoplifting by month, January 2018 to present.

[2] On May 13, 2019, LCBO denied the request, relying on the exceptions set out in ss. 14 (law enforcement), 18 (economic interests), and 20 (danger to safety or health) of FIPPA. In particular, the LCBO maintained that disclosure would endanger its economic interests and the safety of its employees and customers because it would allow thieves to evaluate the efficacy of its security measures and target vulnerable stores. The LCBO also maintained that disclosure would harm its reputation with consumers, which would adversely affect its competitive position vis-à-vis other alcohol retailers. The Toronto Star appealed the LCBO’s decision to the appellant, the Information and Privacy Commissioner of Ontario (“IPC”).

[3] The adjudicator of the IPC did not uphold the LCBO’s decision to deny access to the requested records and on September 16, 2022, ordered the LCBO to disclose them to the Toronto Star.

[4] The LCBO’s application for judicial review to the Divisional Court was successful. On August 10, 2023, a majority of the Divisional Court allowed the application and set aside the appellant’s order. The majority concluded that the adjudicator’s decision was unreasonable because she made the following material errors: she misapplied the standard of proof with respect to the disclosure exemptions under FIPPA; she misapprehended or failed to take important evidence into account; and her reasons were inadequate.

[5] The dissenting judge would have dismissed the application. She disagreed with the majority view and concluded that the adjudicator made no reversible error and that her decision was reasonable and entitled to deference.

[6] On January 16, 2024, this court granted the appellant leave to appeal the order of the Divisional Court.

Standard of Review

[7] On this appeal, this court effectively steps into the shoes of the Divisional Court and focuses on the adjudicator’s decision: Mason v. Canada (Citizenship and Immigration), 2023 SCC 21, 485 D.L.R. (4th) 583, at para. 36; Thales DIS Canada Inc. v. Ontario (Transportation), 2023 ONCA 866, 170 O.R. (3d) 241, at paras. 85-86. There is no deference owed by this court to the decision of the Divisional Court: Mason, at para. 36; Northern Regional Health Authority v. Horrocks, 2021 SCC 42, [2021] 3 S.C.R. 107, at para. 10; Ball v. McAulay, 2020 ONCA 481, 452 D.L.R. (4th) 213, at para. 5. It is common ground that the reasonableness standard of review applies to the adjudicator’s decision: Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, [2019] 4 S.C.R. 653, at para. 23.

[8] The majority of the Divisional Court applied the correct reasonableness standard on judicial review of the adjudicator’s decision. However, we agree with the dissenting judge that the adjudicator made no reversible error and that her decision was reasonable. We therefore allow the appeal.

[9] It is unnecessary to repeat the excellent reasons of the dissenting judge, with which we agree. It suffices for the purposes of this appeal to summarize the following points that the dissenting judge set out in her reasons to support the reasonableness of the adjudicator’s decision.

Standard of Proof

[10] We start with the adjudicator’s treatment of the standard of proof. As the dissenting judge stated, the adjudicator applied the correct “could reasonably be expected to” standard of proof required under the exemption sections of FIPPA on which the LCBO relies. The adjudicator cited the governing principles articulated by the Supreme Court in Merck Frosst Canada Ltd. v. Canada (Health), 2012 SCC 3, [2012] 1 S.C.R. 23 and Ontario (Community Safety and Correctional Services) v. Ontario (Information and Privacy Commissioner), 2014 SCC 31, [2014] 1 S.C.R. 674, that interpret the FIPPA standard. The Supreme Court in Ontario summarized the governing principles at para. 54, as follows:

This Court in Merck Frosst adopted the “reasonable expectation of probable harm” formulation and it should be used wherever the “could reasonably be expected to” language is used in access to information statutes. As the Court in Merck Frosst emphasized, the statute tries to mark out a middle ground between that which is probable and that which is merely possible. An institution must provide evidence “well beyond” or “considerably above” a mere possibility of harm in order to reach that middle ground [Citations omitted.] [Emphasis added.]

[11] When the adjudicator’s reasons are read as a whole, it is clear that she applied the correct test. As the dissenting judge noted, the adjudicator did not require the LCBO to prove its alleged harms from the requested disclosure on a balance of probabilities, or to substantiate a causal connection or link beyond the “clear and direct connection between the disclosure of specific information and the injury that is alleged”, as instructed by the Supreme Court in Merck Frosst, at para. 197.

[12] The LCBO argues that the adjudicator failed to measure the LCBO’s evidence against the “middle ground” between “merely possible” and “probable” required under the Supreme Court’s articulated standard of proof. The LCBO submits that the adjudicator erred because she focussed on determining whether the evidence went “well beyond the merely possible or speculative” without articulating how far the evidence had to reach beyond the “merely possible”, and without articulating the upper-end limit of the “probable” end of the standard of proof. The LCBO argues that this error amounted to a misapplication of the legal standard, rendering the adjudicator’s decision unreasonable.

[13] We do not accept these submissions. It was clear that the adjudicator applied the correct standard and dealt with the crux of the LCBO’s evidence relevant to its submissions. We note, in that respect, that the adjudicator was constrained by the statutory confidentiality provisions under FIPPA, to which we return below, in how far she could articulate with greater specificity the LCBO’s confidential evidence, which was largely what it relied on to support its arguments about harm. It is settled law that an adjudicator does not have to refer to every piece of evidence so long as there is no misapprehension or disregard of the evidence relevant to making the decision: Vavilov, at para. 128; Kitmitto v. Ontario (Securities Commission), 2024 ONSC 1412, at para. 75. That is the case here.

[14] We also do not agree that the adjudicator’s reasons were inadequate because she did not make specific reference to certain aspects of the LCBO’s non-confidential submissions. The LCBO’s contention that it would suffer harms if the records at issue were disclosed were largely contained in its confidential submissions. In any event, reasons must be assessed functionally and contextually, and we are not persuaded that the adjudicator’s failure to make more extensive reference to the LCBO’s non-confidential submissions about its position in the marketplace was a reversible error.

[15] Moreover, it was unnecessary for the adjudicator to articulate a different test than the well-established test cited above for the standard of proof that the LCBO had to meet to claim exemptions from disclosure. As the Supreme Court further instructed in Ontario, at para. 54: “This inquiry of course is contextual and how much evidence and the quality of evidence needed to meet this standard will ultimately depend on the nature of the issue and ‘inherent probabilities or improbabilities or the seriousness of the allegations or consequences’” (citations omitted).

The adjudicator’s assessment of the evidence and adequacy of her reasons

[16] In our view, the argument that the adjudicator applied the wrong standard of proof, as well as the complaints about her treatment of the LCBO’s evidence and the adequacy of her reasons, really amount to a disagreement with her evidentiary findings. As the dissenting judge observed: “The LCBO’s arguments essentially ask this court to adjudicate the issues de novo which is not permissible in a review on the standard of reasonableness.”

[17] There is no basis to interfere with the adjudicator’s findings. In sum, she was not persuaded that the LCBO had met its evidentiary burden to exempt the requested records from disclosure. As the dissenting judge concluded, the adjudicator’s findings were reasonable and open to her on the record.

[18] Moreover, we also agree that the adjudicator’s reasons are adequate, particularly in light of the mandatory restraints imposed by the confidential nature of the LCBO’s evidence under ss. 52(3), (13), and 55(1) of FIPPA. They meet the requirements of “justification, transparency and intelligibility” and are justified in relation to the relevant factual and legal constraints that bore on her decision: Vavilov, at para. 99. When read in light of the record and with due sensitivity to the nature of the IPC’s decision-making regime, the adjudicator’s reasons reveal a rational chain of analysis and meaningfully account for the central issues and concerns raised by the parties: Vavilov, at paras. 103, 127.

Arguments not raised before the adjudicator

[19] Finally, we agree with the dissenting judge that it is inappropriate to fault the adjudicator for not considering the changes to the statutory liquor licensing scheme and, in particular, s. 77(2) of the Liquor Licence and Control Act, 2019, S.O. 2019, c. 15, Sched. 22 (prohibition against disclosure of sales of liquor) (“the LLCA”), on which the LCBO seeks to rely. These statutory changes occurred after the parties’ submissions were made to the adjudicator but before her order was released.

[20] The LCBO does not argue that these statutory changes directly apply but maintains that they are relevant to the overall economic and regulatory context in which the exemptions should be considered. The LCBO argues that this context includes that it does not enjoy an absolute monopoly on the sale of liquor, and that s. 77(2) of the LLCA now provides that information that would reveal the sales of an individual retail store of the LCBO store is confidential.

[21] It is well-established that an adjudicator’s decision will not be found unreasonable for failing to address an issue or argument that was never before it: Alberta (Information and Privacy Commissioner) v. Alberta Teachers’ Association, 2011 SCC 61, [2011] 3 S.C.R. 654, at paras. 22-26; Canada Post Corp. v. Canadian Union of Postal Workers, 2019 SCC 67, [2019] 4 S.C.R. 900, at para. 52.

[22] The LCBO’s arguments were not made to the adjudicator. As the dissenting judge noted, the LCBO did not seek to submit them to the adjudicator, although it had almost a year to do so between the enactment of the statutory changes and the release of her order, nor did it seek a reconsideration of her order. In our view, it would therefore not be appropriate to send this matter back for a rehearing of these issues.

Disposition

[23] Accordingly, the appeal is allowed. The decision of the adjudicator is restored. The parties agree that there should be no order as to costs.

“L.B. Roberts J.A.”

“J. Copeland J.A.”

“J. Dawe J.A.”