CITATION: Lempiala Sand v. HMQ, 2022 ONSC 248
DIVISIONAL COURT FILE NO.: DC 399/20
DATE: 20220202
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Morawetz C.J., Varpio, Kristjanson, JJ.
BETWEEN:
LEMPIALA SAND & GRAVEL LIMITED
Applicant
– and –
HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO AS REPRESENTED BY THE MINISTRY OF NATURAL RESOURCES AND FORESTRY
Respondent
Marc McAree/Alessia Petricone-Westwood, for the Applicant
William R. MacLarkey, for the Respondent
HEARD: December 1, 2021
REASONS FOR DECISION
Varpio J.:
OVERVIEW
[1] Lempiala Sand and Gravel Limited (“Lempiala”) and Milne Aggregates Inc. (“Milne”) are companies that operate pits and quarries in Northwestern Ontario. In 2018, both Lempiala and Milne sought permits from the Ministry of Natural Resources and Forestry (the “Ministry”) to extract aggregate from Crown Land in an area known as Fowler Pit near Thunder Bay. The Ministry deals with such applications on a first-come, first-served basis.[^1]
[2] Lempiala made the first inquiry regarding a permit for the Fowler Pit site in the summer of 2017 but it did not tender a formal application at that time. In February 2018, Milne submitted an application. On May 16, 2018, the Ministry deemed Milne’s application complete effective March 23, 2018. This decision gave Milne the exclusive opportunity to secure a permit to extract aggregate on Fowler Pit.
[3] Lempiala submitted an application in July of 2018. The Ministry advised Lempiala that it would not consider its application.
[4] Lempiala brings an application seeking judicial review of the Ministry’s decision deeming Milne’s application complete. Specifically, Lempiala submits that certain Ministry policies govern the application process and that Milne’s application did not meet the standards imposed by same. Furthermore, Lempiala seeks an order in the nature of mandamus requiring the Ministry to consider its application, rather than Milne’s application.[^2]
[5] The Ministry submits that the impugned policies do not apply to the initial stage of the application process and, as such, the Ministry was reasonable in reaching its decision.
[6] After a fulsome reading of the governing jurisprudence and the legislative, regulatory and policy schemes that govern the application process, I find that the Ministry was not reasonable in its determination. The Ministry did not provide any evidence to this court that it had metrics by which it could determine completeness. The failure to adduce this evidence means that this court has no basis to conclude that the Ministry adequately considered relevant factors in deeming Milne’s application complete, or whether the Ministry was arbitrary in that regard. The governing jurisprudence holds that the inability to distill the Ministry’s logic requires that the decision be quashed.
[7] Given this absence of decision-making criteria, the court does not have a sufficient evidentiary basis to grant an order in the nature of mandamus. The matter is therefore remitted back to the Ministry to be decided in a fashion consistent with these reasons.
FACTS
[8] Prior to considering the events that led to this application, it is useful to understand the legislative, regulatory and policy framework that governs the operation of quarries and pits in Ontario.
The Framework
The Operating Legislation and Regulations
[9] To operate a pit or a quarry on Crown land, an individual or an organization must address environmental, archeological, and other concerns. In keeping with that goal, section 7(1) of the Aggregates Resources Act, R.S.O. 1990, c.A.8, (the “Act”) demands that all pit or quarry operators in Ontario be licensed:
Licences required
7 (1) No person shall, in a part of Ontario designated under section 5, operate a pit or quarry on land that is not land under water and the surface rights of which are not the property of the Crown except under the authority of and in accordance with a licence.
[10] At the relevant times, section 34(4) of the Act enabled individuals or organizations to apply for a permit:
Applications for aggregate permit
(4) Any person may apply to the Minister for an aggregate permit to operate a pit or quarry.
[11] In 2018, when Milne and Lempiala submitted their applications, s. 34(4.1) of the Act permitted the Ministry to charge an application fee. The Ministry established a $500 fee for aggregate permits at that time as per S.O. 1996 c. 30 Reg. 244/97 (the “Regulation”).
[12] Section 7 of the Regulation as it then read adopted certain standards for the application process (the “Provincial Standards”):
Applications for licenses, aggregate permits or wayside permits and the operation of pits and quarries shall be in accordance with “Aggregate Resources of Ontario: Provincial Standards, Version 1.0” published by the Ministry of Natural Resources.
The Provincial Standards
[13] The Provincial Standards are documents written by the Ministry that deal with pit and quarry operations. The Provincial Standards subdivide aggregate permits into 5 categories. Category 9 applies to operations no closer than 1.5 meters above the established groundwater table. Category 11 applies to operations no closer than 2 metres above the established groundwater table. The parties agree that the Provincial Standards dealing with Categories 9 and 11 apply to the instant application and that the Provincial Standards dealing with these categories are identical for all intents and purposes.[^3]
[14] The introductions to Categories 9 and 11 outline the main areas of concern addressed by the Provincial Standards:
These Standards have been developed to support the Aggregate Resources Act as amended by Bill 52, the Aggregate and Petroleum Resources Statue Law Amendment Act, 1996. There are three main headings:
Licenses…
Aggregate permits…
Wayside Permits [sic]… [Emphasis in original.]
[15] Six major topic areas are dealt with as subsets of the three aforementioned areas of consideration:
The enabling authority in Bill 52 allows for six major topic areas to be reflected in the standards. They are:
• Report Standards
• Notification and Consultation
[16] The Provincial Standards define report standards as follows:
The report standards have two components: summary statement and technical reports. All categories of applications are required to submit these reports. The author of these reports may be:
the applicant for summary statements where the applicant possesses the qualifications or experience; and
qualified individuals for the technical reports.
For very unique issues on a site specific basis, additional information to that identified in the Report Standards may be requested.
[17] The Provincial Standards also specify some of the content to be included in given reports. Provincial Standard “2.0 Report Standards for Category 9 Applications” describes the information that must be contained within a summary statement report (“Summary Statement”)[^4]:
A summary statement accompanying an application for an aggregate permit must be signed by the author and provide information on the following:
2.1.1 determine the elevation of the water table within the site or demonstrate that the final depth of extraction is at least 1.5 metres above the water table; and
2.1.2 if the present land use is agriculture, the agricultural classification of the proposed site, using the Canada Land Inventory classes, must be identified. For the lands being returned to agriculture the proposed rehabilitation techniques must be identified.
The summary statement may be prepared by the applicant and may include information previously submitted or referenced as part of the Forest Management Planning process [Emphasis in original.]
[18] The Provincial Standards are silent as to how the information is to be determined and what form the Summary Statement is to take.
[19] Policy “2.0 Report Standards for Category 9 Applications” also describes the necessary technical reports that must be included in any application:
2.2 Technical Reports
Technical Reports accompanying an application for an aggregate permit must provide information on the following:
2.2.1 Natural Environment Level 1: determine whether any of the following features exist on and within 120 metres of the site: significant wetland, significant portions of the habitat of endangered or threatened species…
2.2.2 Natural Environment Level 2: impact assessment where the level 1 analysis identified any features on and within 120 metres of the site in order to determine whether there will be any negative impacts on the natural features or ecological functions for which the area is identified, and any proposed preventative, mitigative or remedial measures;
2.2.3 Cultural Heritage Resource Stage 1: determine if there are any known significant archaeological resources on the subject property and the potential of the site to have heritage resources;
2.2.4 Cultural Heritage Resource Stage 2: property survey by a licensed archaeologist if stage 1 identifies known resources or a medium to high potential for heritage resources on the site and mitigation, if recommended;
2.2.5 Cultural Heritage Resource Stages 3 and 4: detailed site investigation by a licensed archaeologist (e.g. test pits, plowing fields and survey) when recommended by stage 2 and mitigation through excavation, documentation, or avoidance, if recommended; and
2.2.6 Each report shall state the qualifications and experience of the individual(s) that have prepared the reports.
The technical report(s) must be prepared by a person with appropriate training and/or experience and may include information previously submitted or referenced as part of the Forest Management Planning process. [Emphasis in original.]
[20] Provincial Standard “4.0 Notification and Consultation Standards for Category 9 Applications” proscribes that:
The applicant shall submit all required documentation to the Ministry of Natural Resources. Within fifteen (15) days, the Ministry of Natural Resources shall determine if the application is complete. Once the application is determined to be complete, the applicant may proceed with the following Notification and Consultation Standards. [Emphasis in original.]
Ministry Policies
[21] The Ministry has also developed policies (“Ministry Policies”) that apply to the permit issuance process. The relevant policies are reproduced below.
Policy 4.00.00
[22] Ministry Policy A.R. 4.00.00 “Aggregate Permits – General” (“Aggregates Policy”) describes its guiding principles as follows:
Guiding Principles
The issuance of aggregate permits is considered a disposition of a Crown resource.
The permit serves several purposes, including the management of the aggregate resource, control and regulation of aggregate operations, requiring the rehabilitation of lands from which aggregate is removed and minimizing adverse environmental impacts from aggregate operations.
The permit also serves as an approval and regulatory instrument for the removal of private land aggregates from land under water. [Emphasis in original.]
[23] Under the subheading “Permit Application Process”, the Aggregates Policy describes the classifications of the various permits:
Permit Application Process
Applications for aggregate permits are classified into 5 categories, based on the nature of the undertaking as described in the Aggregate Resources of Ontario Provincial Standards. The 5 categories of application are as follows:
Category 9: Pit Above Water
Category 11: Quarry Above Water…
[24] Below this same “Permit Application Process” subheading, the Aggregates Policy describes the technical reports that must accompany applications:
Technical Reports
It is a requirement under the Provincial Standards that all permit applications shall include all appropriate reports. The reports must be prepared in accordance with Section 2.0 Report Standards (see A.R. 4.01.04 through A.R. 4.01.08) for the Category being applied for under the Provincial Standards, and be submitted as part of the application package. [Emphasis added.]
Policy 4.01.01c – The Issuance of Permits
[25] Ministry Policy A.R. 4.01.01c “Aggregate Permit Applications: Categories 9 to 12 (Land), EAA Categories B or C Project” (the “Issuance Policy”) provides guidance to Ministry staff on the application process. The Issuance Policy outlines an initial seven-step submission and compliance procedure whereby the Ministry is to ensure that an application is complete. Step 1 of the process states:
Internal Procedure
A. Submission/Compliance
Step 1
Upon receipt of the application package, date and time stamp the application and check that all appropriate documents are submitted (i.e. complete and attach to the file a copy of the Aggregate Permit Application Checklist (see Appendix E):
(a) Application form (duly signed & executed by an authorized person);
(b) Permit application fee
(d) Two copies of each report as required under Section 2.0 of the Aggregate Resources of Ontario Provincial Standards (including summary statement and all applicable technical reports)…
[26] Step two deals with administrative details like the assignment of file numbers. Steps three and four of the Issuance Policy deal with more substantive forms of review:
Step 3
The Aggregate Inspector or designated MNR staff must prepare a letter, for the Area Supervisor’s signature, to advise the applicant of any additional EAA consultation and information requirements…
Step 4
The Aggregate Inspector must review the application package and determine whether the application meets the requirements of the [Act] and the regulations (including the Provincial Standards)… This review is solely to assess whether the information requirements have been met. [The Ministry] has 15 days to determine whether the application is complete; this period commences upon receipt of the application by [the Ministry]...
[The Ministry’s] concerns with regard to any potential impacts, if any, are to be addressed during the notification and consultation phase of the application process (i.e. minimum 30-day commenting period is extended from 20 days by the Class EA process).
The Aggregate Inspector must ensure that:
(b) All items under Section 2.0 Report Standards (i.e. summary statement and technical reports) are addressed and that the correct level of reports are submitted (e.g. Level 2 Natural Environmental if required)…
[27] Step 5 of the procedure deals with the case where a report is deemed to be “incomplete”:
If the application is deemed to be incomplete (i.e. the Ministry has 15 days to make this determination), the Aggregate Inspector will return the application package (except the fee) to the applicant, along with a letter explaining the application deficiencies. Upon re-submission of the application, return to Step 1. The Ministry 15-day review period recommences. [Emphasis in original.]
[28] Steps 6 and 7 describe administrative functions to be performed by the Ministry once an application is deemed complete.
[29] Subsequent steps in the Issuance Policy describe subsequent stages of the permit issuance process such as “Notification/Consultation”, “Resolution of Concerns”, “Decision Process”, and “Preparation and Issuance of the Permit”.
Policy 4.01.04 – The Summary Statement
[30] Ministry Policy A.R. 4.01.04 “Aggregate Permit Applications: Summary Statement Report Standards (Categories 9-12)” (“Summary Statement Policy”) describes various features of a Summary Statement. The Summary Statement Policy describes its guiding principle as follows:
Guiding Principle
To properly assess a proposed application, and to prevent or mitigate potential impacts, appropriate reports are required to accompany an application. [Emphasis in original.]
[31] The Summary Statement Policy indicates that all applications must include a Summary Statement:
Policy
All applications for an aggregate permit must be accompanied by appropriate studies as described within the Report Standards under the Aggregate Resources of Ontario Provincial Standards for the category(s) being contemplated. The Report Standards include a Summary Statement which may be prepared by the applicant.
[32] The Summary Statement Policy establishes that:
The Summary Statement must be signed by the author and provides information on one or more of the following aspects, depending on the category(s) under application:
Determine the elevation of the established groundwater table within the site or demonstrate that the final depth of extraction is at least 1.5 metres above the water table for a pit. In the case of a quarry, for both the surficial material (if present) and the bedrock strata, demonstrate that the final depth of extraction is at least 2 metres above the highest of the on-site groundwater table levels.
This portion of the summary statement must be prepared by either:
i) An individual who is a registered “Professional Geoscientist” as defined under the Professional Geoscientists Act and is qualified to determine the established ground water table; or
ii) An individual who is licensed as a “Professional Engineer” under the Professional Engineers Act and who is competent by virtue of training and experience, to engage in practices that would also constitute the practice of professional geosciences (i.e. hydrogeology). [Emphasis in original.]
[33] The Summary Statement Policy also describes ways by which the water table can be determined for an area where a permit is sought. The Summary Statement Policy states:
Information sources to determine the elevation of the water table on the site may include existing well data, surface water elevations of nearby water bodies or features, and testing (e.g. wells/holes) by the applicant. More than one source may be necessary to make this determination. Where there is a lack of available information, it will be necessary for the applicant to establish the water table by digging or drilling test holes. The report must indicate the time of year when the testing was performed and how the elevation was established. A time of seasonal high (i.e. April/May or September/October) is the preferred time for establishing the elevation of the water table… [Emphasis added.]
Policy 4.01.06 – The Natural Environment Level 1 Report
[34] Ministry Policy A.R. 4.01.06 “Aggregate Permit Application: Natural Environment Report Standards” (“Environmental Policy”) deals with environmental issues contained within the application process. The Environmental Policy describes its guiding principles as follows:
Guiding Principles
The purposes of the Natural Environment report are to determine the presence of natural heritage environment/areas and fish habitat in accordance with the Aggregate Resources of Ontario Provincial Standards, and to ensure that any necessary preventative, mitigative or remedial measures are undertaken for their protection. [Emphasis in original.]
[35] The Environmental Policy describes the individuals that may submit Natural Environment reports:
Policy
All Natural Environment reports must be prepared by a person with appropriate training and/or experience in the identification of fish habitat and significant natural heritage features/areas. Each report must include the qualifications and experience of the individual(s) that have prepared the report and be signed by the author.
[36] The Environmental Policy describes the various environmental reports. The Environmental Policy defines the Natural Environment Level 1 report (“NEL 1”) as follows:
A Natural Environment Level 1 report determines whether one or more of the following features exist on-site or withing 120 metres of the site:
a) significant wetlands (including significant coastal wetlands);
b) significant habitat of endangered and threatened species;
c) significant Areas of Natural and Scientific Interest (ANSIs);
d) significant woodlands (south and east of the Canadian Shield);
e) significant valleylands (south and east of the Canadian Shield);
f) significant wildlife habitat; and
g) fish habitat. [Emphasis in original.]
[37] The Environmental Policy also sets expectations for the person that prepares the NEL 1:
The person preparing the report is responsible for ensuring that consultation occurs with appropriate MNR. As a pre-consultation service, MNR staff should provide any available background information (e.g. location(s) of wetlands, ANSIs, threatened and endangered species habitat and fish habitat) to those qualified individuals preparing the report. This information may be obtained from district files, the Natural Resources Values Inventory System (NRVIS) and the Natural Heritage Information Centre (NHIC).
The qualified individual must determine whether any of the above features exist during a site inspection/visit(s). Where there is a known presence of a feature based on existing information, or the site lies within the geographic range of a feature (e.g. endangered or threatened species) and the habitat is appropriate, the inspection must be carried out at a time when the feature would be expected to be visible, using good field observation and investigation practices. It is important to recognize that while some significant resources may already be identified and inventoried by official sources, the significance of others can only be determined after evaluation by the proponent/applicant. [Emphasis added.]
[38] The Environmental Policy provides that follow up reports may be necessary:
The Level 1 report must clearly conclude whether each of the features (a-g, above) exists on or within 120 m of the site. The report also must provide sufficient information on the methodology and findings to substantiate the conclusions.
If any of these features are identified, then an impact assessment (i.e. Natural Environment Level 2 report) is required to determine any negative impacts on the natural features or ecological functions, and any proposed preventative, mitigative or remedial measures. [Emphasis in original.]
[39] The Environmental Policy also describes other areas of concern including issues dealing with wetland conservation, habitat protection for endangered and threatened species, and other such issues.
Policy 4.01.07 – Cultural Heritage
[40] Ministry Policy A.R. 4.01.07 “Aggregate Permit Application: Cultural Heritage Resource Report Standards (Categories 9-12)” (“Cultural Heritage Policy”) deals with cultural heritage and anthropology. The Cultural Heritage Policy describes its guiding principle as follows:
Guiding Principle
Heritage values provide information about the past and reflect the human history of Ontario and require a comprehensive review of the geographic and historical features of a property and its surroundings. [Emphasis in original.]
[41] The Cultural Heritage Policy describes the intent of Cultural Heritage Resource reports (“Cultural Heritage Report”):
Policy
The purpose of a Cultural Heritage Resource report is to ensure that archaeological resources are identified, assessed for their significance, and protected (i.e. preserved or collected) in order to better understand and appreciate Ontario’s culturally diverse Aboriginal and non-Aboriginal communities heritage [sic].
[42] The Cultural Heritage Policy specifies that a Cultural Heritage Report must examine matters below the earth’s surface:
“Archaeological resources include the physical remains and contextual setting of any structure, event, activity, place, feature or object which, because of the passage of time is on or below the surface of the land or water, and is important to understanding the history of a people or race” (MCzCR, 1997) [Emphasis in original.]
[43] The Cultural Heritage Policy also defines the metrics by which a Cultural Heritage Report’s findings will be assessed:
Applications are initially assessed based on the potential or likelihood that those lands will contain any archaeological resources including potential impacts to built heritage (i.e. individual heritage structures) and cultural heritage landscapes (i.e. significant heritage areas, districts, cemeteries). A wide range of geographical and cultural-historic features, which directly influenced the use and settlement by the past inhabitants of a region, determines the potential.
[44] Finally, the Cultural Heritage Policy describes the means by which a Cultural Heritage Report may evidence its findings:
Various levels of assessment (i.e. stages 1-4) may be required depending on the potential for, and significance of the archaeological resources present on site. A Cultural Heritage Resources Stage 1 report determines whether there are any known resources or potential for resources. Generally, the Heritage & Libraries Branch of the Ministry of Culture (MCL) will initially flag the potential for heritage resources at the Stage 1 level for the consultant. The Stage 1 report may consist of a sign-off letter from the MCL, Heritage & Libraries, Branch, confirming that there are no known significant archaeological resources on the site or low potential for the site to have heritage resources. A licensed archaeologist may assess the archaeological potential, to supplement or take the place of a determination by the MCL. The consultant assesses potential by reviewing geographic, land use and historic information and by visiting the property and surrounding area to conduct a surface inspection…
Chronology of Events
Lempiala’s Preliminary Inquiries
[45] On August 11, 2017, Mr. Dante Di Gregorio, a Lempiala representative, submitted a “preliminary” permit application for the Fowler Pit asking the Ministry to “secure the site” so that Lempiala could “proceed with procuring the requisite studies and complet[e] the application requirements.” He indicated to the Ministry that he would ultimately provide an “updated application” and application fee.[^5]
[46] On August 17, 2017, Ms. Cally Manning—the Ministry’s Aggregate Specialist responsible for reviewing and processing the permit application—informed Mr. Di Gregorio that the site could not be secured as the Ministry had not received a complete application and application fee. Ms. Manning informed Mr. Di Gregorio that she would record that Mr. Di Gregorio had submitted information regarding an aggregate permit. She also indicated that the prospective applicant had to apply for a Land Use Permit for Sand and Gravel Exploration per the Public Lands Act if it wished to secure the site prior to submitting a complete permit application.[^6]
Milne’s Application
[47] On February 1, 2018 Milne submitted a permit application for the Fowler Pit. This application included:
a. Two copies of the site plan;
b. A Summary Statement;
c. An NEL 1; and
d. A letter from Milne’s consultant regarding the proposed site’s archaeological potential.
[48] The Summary Statement was prepared by North Rock Environmental Inc. (“North Rock”). In the introduction, North Rock stated that
[t]his technical report constitutes our professional opinion of the groundwater and site conditions, evidenced by desktop data review and supplemented by available geological and topographical mapping. This summary statement, as required for Category 9/11 permitting, relies upon hydrogeological interpretations and has been prepared by a qualified person (in accordance with the Professional Geoscientist Act, 2000).
The preparation of this technical report and its development processes have been carried out with guidance and reference to the Ministry of Natural Resources Policy No. A.R.4.01.04 memoranda. This report is a preliminary evaluation of the final extraction depth and the potential for adverse effects to groundwater and surface water resources at the proposed site.
[49] North Rock’s Summary Statement described information regarding the groundwater table by using evidence taken from, inter alia, wells situated within a kilometre of Fowler Pit. The Senior Hydrologist then drew conclusions regarding the water table at Fowler Pit.[^7]
[50] North Rock also prepared Milne’s NEL 1. In the introduction to same, North Rock stated:
Milne Aggregates Incorporated retained North Rock Environmental Inc. (North Rock) to provide a Natural Environment Level (NEL) 1 Assessment in support of a Category 9 Aggregate Permit Application…. This report outlines the results of background research undertaken to meet the requirements of the NEL 1 Assessment as per the Aggregate Resources of Ontario document – Provincial Standards, Version 1.0 – which was developed to support the Aggregate Resources Act, RSO. 1990 c.A.8 (amended by S.O. 1996 c.30 Reg. 244/97, 535/97 and 52/98). The NEL 1 Assessment is required for any areas proposed for the extraction of aggregates, identifying any of the following features on or within 120 metres of the site:
• Significant wetlands
• Fish habitat
• Significant wildlife habitat
• Significant portions of the habitat of endangered or threatened species
• Significant areas of natural and scientific interest (ANSI)
[51] Under a heading entitled “2.0 Site Reconnaissance”, North Rock’s NEL 1 indicated as follows:
A biologist has not completed a site visit, but has prepared this desktop study to investigate the surface features, drainage patterns, and natural environment within and surrounding the site. The site can be accessed via Gilbride Rd and a tertiary road network of forestry access roads within and around the proposed site. [Emphasis added.]
[52] Under heading “10.0 Summary”, the report stated:
A tertiary road network exists throughout the proposed site and surrounding area, and forest harvesting activities appear to have occurred historically (i.e. pre 2005), and recently between 2010 and 2016 throughout much of the proposed pit areas. No significant wetlands, no significant wildlife habitat, no significant portions of the habitat of endangered or threatened species, and no significant ANSI was identified within the proposed permit area although the Barclay Bog, a significant wetland exists within 120-metres of the proposed boundary. Other features of general interest recognized on-site include the expected use of the site by various bird species of northwestern Ontario.
Typically, sensitive times of the year for birds living in northwestern Ontario include the spring breeding season. As such, clearing of trees as part of preparations for development of the site is recommended for the period of August 15 through to the end of March, to avoid disturbance of the area during the bird breeding season. In summary, with vegetative buffers to protect mature forests, lakes, creeks, and wetland habitat, and timing restrictions to protect breeding birds, development of proposed aggregate site at this location is not expected to alter the environmental conditions to any great degree beyond the current level of impact and human encroachment within the general area. As such, a more detailed (i.e. NEL 2) assessment is not foreseen to be necessary.
[53] On February 8, 2018, Milne submitted an application permit form and paid the application fee.
[54] On February 13, 2018, Milne submitted a completed checklist generated by the Ministry of Tourism, Culture and Sport (“MTCS”) entitled “Criteria for Evaluating Archaeological Potential”. At the top of the document, the following appears:
“Archaeological potential” is a term used to describe the likelihood that a property contains archaeological resources. This checklist is intended to assist non-specialists screening for the archaeological potential of a property where site alteration is proposed.
[55] This checklist document was not the up-to-date version of same, but rather was a dated version thereof.
[56] Milne attached an email from MTCS along with its February 13, 2018 submission. The email indicated that the proposed site had “low potential” for archaeological impact, based upon the information Milne had previously provided to MTCS.
Ministry Review of Milne’s Application
[57] In its application materials, the Ministry filed a document entitled “Aggregate Permit Application Checklist” with the sub-heading “(for internal use only)”. The checklist appears to be a document that enables the Ministry to review an application and to analyze same for completeness. Sub-heading five of the document states “Technical Reports Received (date) _____”. In handwriting, the date “Feb 15/2018” appears. Beside the area for the entry of a date is an area where a Ministry representative can check “Accepted” or “Not Accepted”. The “Accepted” and “Not Accepted” boxes are not filled in. Various technical reports are also listed under this sub-heading. “Natural Environment – Level 1” is checked off as being received, as is a box stating, “Reports prepared by qualified individual & signed”. A box for “Cultural Heritage (stage 1, 2, 3 or 4)” is left blank. Below these boxes, a box entitled “Summary Statement” is also checked off but neither the “Accepted” nor the “Not Accepted” boxes (which appear next to the “Summary Statement” box) are selected.
[58] On March 6, 2018, Ms. Manning wrote to a Ministry hydrogeologist asking him to review Milne’s application. She raised concerns about the Summary Statement. The hydrologist replied that Milne’s methodology was unsatisfactory and that the document required more work.
[59] On March 8, 2018, the Ministry, Milne representatives, and North Rock met to discuss the application. At this meeting, Milne provided Ms. Manning with the information that Milne had provided to MTCS which had formed the basis of the MTCS email submitted with Milne’s application on February 8, 2018. The Ministry did not specify to the court which archaeological information was submitted by Milne on March 8, 2018.[^8]
[60] In late March of 2018, the Ministry received a complaint that heavy machinery was digging “test pits” in the Fowler Pit area. Ms. Manning learned that a company was carrying out this work for Lempiala or a related company. On April 4, 2018, Ms. Manning called Mr. Di Gregorio regarding the complaint and the fact that the digging occurred without a permit.
[61] On March 27, 2018, Ms. Manning emailed Ms. Karla Barboza of the MTCS to ask:
Hi Karla,
Hope you are doing well today. We met last week at the MMA Planning Conference in Thunder Bay. I am the Aggregate Technical Specialist for Thunder Bay District MNRF and was asking you about Screening criteria for whether a Cultural Heritage Stage 1 Report is required for an Aggregate application. I was hoping we could chat about a file I have and the information that was provided to you folks vs myself in respect to this aggregate application and whether it is sufficient to negate the need for a Stage 1 assessment. I just want to wrap my head around what kinds of things you look for or don’t and what to expect if MTCS has no concerns and we can take that as “No Stage 1 necessary”.
I have attached the documents as provided to us with the Aggregate Permit application that they have identified were given to you. The mapped area on the map submitted to you is not the same as the application boundary, so I have added a map that I created of the application boundary for reference. Take a look at these attachments (noting dates on them) and lets [sic] set up a time to chat.
Or you could forward me onto someone else if that is more appropriate.
Thank you for your time and have a wonderful afternoon,
[62] On April 9, 2018, Ms. Barboza emailed Ms. Manning and stated:
For our call this morning … It seems that the checklist previously completed is an older version.
[63] No record of the apparent April 9, 2018 call between Ms. Barboza and Ms. Manning was entered into the record before this court.
[64] On April 13, 2018, Ms. Manning and Mr. Di Gregorio had a phone meeting. The parties disagree as to the contents of the conversation, however I need not resolve this dispute for the purposes of these reasons.
[65] On April 25, 2018, a North Rock representative emailed Ms. Manning to advise: “We’re planning the NEL1 field visit for Thursday May 24, 2018. Does this accommodate bird breeding windows and is it an acceptable time to complete the field investigation?” On April 26, 2018, Ms. Manning replied:
I received a response from our biologist and they have advised me that that timing is still a little early. They recommend surveying between June 1^st^ and June 15^th^ in order to capture the peak bird breeding window, especially for migratory species and some Species at Risk.
More to come on this application in the near future.
[66] On April 26, 2018, Ms. Katherine Kirzati of the MTCS emailed Ms. Manning and advised as follows:
Hi Cally:
Thank you for reaching out on the above-noted project (Category 9 pit application) and providing additional information that was not in our records. My response is two-fold:
Assessment Reports
As per our conversation, MTCS is not an approval authority and only provides advice with respect to cultural heritage resources. In other words, we do not “clear” the heritage component of an application. As such, it is up to the ministry/agency that issues any permits or approvals to determine whether an application requires an archaeological assessment or a heritage impact assessment.
To assist with that, MTCS has created a series of checklists for non-specialists, to be used as screening instruments for determining the need for undertaking assessments. They can be found via the following links…
These checklists should be completed by every proponent and submitted to the approval authority as part of a complete application. If the result of the checklists is to undertake the relevant assessment, the proponent should follow through by engaging a qualified professional, with recent and relevant experience in the matter. In the event that the approval authority has questions, MTCS is available to assist by providing any information it can.
Please note that archaeological assessments and marine archaeological assessments are submitted by the licensed archaeologist directly to MTCS (Archaeology Program Unit) for review. If the report is found to be in compliance with the Standards and Guidelines for Consultant Archaeologists, a letter is issued to the archaeologist, and copied to the proponent and approval authority, stating that the report has been entered into the register.
I hope this helps clarify the process. Please feel free to forward this information and these links to your colleagues.
Milne/Hawkeye Lake Pit Application:
With respect to the archaeological checklist submitted, it appears that the proponent completed the incorrect version 0478E (2011/07). The most recent version is 0478E (2015/11), which provides more instruction and may lead to a different outcome. I would recommend that the proponent be asked to re-submit the newer version… [Emphasis added.]
[67] Around this time, the Ministry concluded that Milne had submitted a complete application. Ms. Manning deposed that the decision to deem Milne’s application as being complete was undertaken in consultation with her direct supervisor, Ms. Emily Hawkins, the Ministry’s Resource Operations Supervisor:
The determination that Milne’s application was complete under the Provincial Standards, and in particular that Milne satisfied the Cultural Heritage Resource Stage 1 requirement, was made after consultation with Ms. Hawkins, my direct supervisor. I had raised a concern with Ms. Hawkins that Milne’s information for the Cultural Heritage Resources Stage 1 was deficient, but in speaking with her, she emphasised review of the requirements of the Provincial Standards for determining completeness and that various comments the Ministry had could be addressed through the Notification and Consultation stage, as is often done. Based on these considerations, we were satisfied that Milne’s application was complete under the Provincial Standards as of March 23, 2018.
Similarly, and with reference to Silvio’s Affidavit at paragraph 32, the requirement for a biologists [sic] site visit for the NEL 1 Report, and the requirement that a qualified individual perform drilling to establish the water table, are found in Ministry Policies, and are not requirements in the Provincial Standards for determining whether an application is complete, such that the Notification and Consultation phase may begin.[^9]
[68] The Ministry did not file any evidence regarding the metrics it used to determine that Milne’s application was complete beyond the paragraphs from Ms. Manning’s affidavit reproduced above.
[69] On May 16, 2018, Ms. Hawkins wrote to Milne and confirmed that Milne’s application was deemed complete as of March 23, 2018 (the “Decision”):
Dear Mr. Milne,
Thank you for your Category 9 & 11 application for an aggregate permit under the Aggregate Resources Act (ARA) for Ontario. We have conducted a preliminary review of the application under this act, as well as the Environmental Assessment Act of Ontario, and provide the following feedback.
After completing the technical review of this application it has been determined that the information provided meets the requirements of the Aggregate Resources of Ontario Provincial Standards Version 1.0 and is hereby deemed complete as of March 23^rd^, 2018…
We very much appreciated the opportunity to discuss this application on March 8, 2018 with Mr. Bob Milne, as well as your consultants. As discussed, we typically work with proponents in advance of a formal application to identify key issues and considerations to help inform the application package. We recognize that Milne has elected not to do this in this instance. While this is your choice, please be aware the Ministry has a number of significant comments regarding this application and MNRF’s mandated interests that may fundamentally change what is proposed. You may wish to address these items prior to commencing the notification and consultation period under the ARA. We will be following up with a separate letter with these comments…
[70] It should be noted that the initial application was submitted on February 8, 2018 and Ms. Hawkins’ confirmation occurred more than 15 days after same. Ms. Manning deposed that the Ministry deemed Milne’s application complete 15 days after the March 8, 2018 meeting where Milne furnished the Ministry with the archaeological information that Milne had initially provided to the MTCS. Put another way, Milne “completed” its application when it submitted archaeological information to the Ministry on March 8, 2018.
[71] On May 18, 2018, Ms. Manning wrote to Milne and provided comments about the Milne application in a four-page letter. The letter began:
Dear Mr. Milne,
This letter is to inform you that the Ministry of Natural Resources and Forestry (MNRF) has completed a preliminary review of your Category 9 & 11 application for an aggregate permit.
During our review a number of items have been identified that we have concerns with and would like to draw further attention to…
[72] With respect to archaeological issues, Ms. Manning wrote:
Cultural Heritage 1
The cultural heritage level 1 information that was provided has not accurately depicted what is required for this report. The Archaeological Checklist that was used is an incorrect older version 0478E (2011/07) and the updated version of this checklist 0478E (2015/11) can be found on the Ministry of Tourism and Culture website:
[link to checklist provided]...
For example, when at question #8. “Has the entire property (or project area) been subjected to recent extensive and intensive ground disturbance”? [sic] Regarding the matter of extensive and intensive disturbance, the MTCS’s Archaeology Program Unit does not deem forestry clear-cutting activity to be intensive disturbance unless topsoil has been removed. If tree harvesting has occurred and the stumps have not been removed, an archaeological assessment would be required, provided that other items on the checklist lead to this conclusion.
The map (as identified sent to MTCS) submitted with the application package does not include the entire site boundary as applied for. The appropriate information should have been forwarded to MTCS including the accurate area shown. The area within the applied for boundary has not been extensively or intensively disturbed (even if portions appeared to be where clear cutting occurred the clear-cut operation only covers a portion of the applied for area, not the entire site). Thus a level 1 Archaeological report is required.
In addition to this proponents should be providing photographic evidence of the condition of the property, which helps to identify what disturbance, if any, has occurred, and what the landscape consists of. [Emphasis added.]
[73] Ms. Manning then described the Ministry’s concerns regarding the environmental information submitted by Milne:
Natural Environment Report
The Natural Environment Report produced for this application has some good information within but still needs to consider the potential for some Significant Wildlife habitat or Species at Risk (and their habitat) that may not have been previously identified in this area. A field visit would be expected to be completed for this review to be complete as per Aggregate Resources Act Policy A.R. 4.01.06 – which states:
“The qualified individual must determine whether any of the above features exist during a site inspection/visit(s). Where there is a known presence of a feature based on existing information, or the site lies within the geographic range of a feature (e.g. endangered or threatened species) and the habitat is appropriate, the inspection must be carried out at a time when the feature would be expected to be visible, using good field observation and investigation practices.” [Emphasis added.]
[74] Ms. Manning then listed eleven other environmental issues that needed to be addressed, as well as five additional concerns.[^10]
Post-Completion Decision Events
[75] On July 18, 2018, Lempiala filed a permit application for the Fowler Pit that included technical reports and a Summary Statement.
[76] On August 3, 2018, Milne submitted updated technical reports and a Cultural Heritage Report.
[77] On August 7, 2018, the Ministry informed Lempiala that it had already accepted an aggregate permit application for the Fowler Pit and that it would not review or process Lempiala’s application until it had fully considered the outstanding application.
POSITION OF THE PARTIES
[78] The parties disagree with respect to the application of the Ministry Policies at the completeness stage. Lempiala’s Secretary-Treasurer, Mr. Silvio Di Gregorio, swore an affidavit wherein he described Lempiala’s position:
In my experience with aggregate permit and licence applications, the submission of aggregate permit applications commonly includes multiple levels of review with Ministry technical staff (for example, biologists and hydrogeologists). Ministry staff often require revisions to site boundaries, environmental buffers and resubmission of technical reports to reflect comments and updates jointly agreed.
In my experience, an aggregate permit application is typically deemed complete by the Ministry once the Ministry receives all required reports that meet the basic requirements set out in the Provincial Standards and Ministry Policies.
[79] Lempiala thus takes the position that the Milne application was never complete because its Summary Statement and technical reports did not meet the requirements as set out in the Provincial Standards and Ministry Policies. Specifically, Lempiala submits that the Milne application was at all material times deficient because:
a. The Summary Statement failed to outline the depth of the groundwater tablethrough a site visit;
b. It failed to provide a proper NEL 1 based on a biologist’s site visit as proscribed by Ministry Policies; and
c. It failed to provide a Cultural Heritage Report.
[80] Accordingly, when Lempiala submitted its application (which ostensibly included all the aforementioned information) on August 3, 2018, Milne’s application was not yet complete and, as such, the Ministry ought to have considered Lempiala’s application and not Milne’s.
[81] Lempiala thus seeks an order quashing the Decision as being unreasonable. Further, Lempiala seeks an order in the nature of mandamus requiring the Ministry to consider Lempiala’s application.
[82] The Ministry submits that the Ministry Policies do not provide “bright line” thresholds for completeness of an application. In fact, the Ministry submits that Ministry Policies describing technical reports do not apply to the initial stages of the application process. Rather, the operative term “provide information” as contained in the Provincial Standards mandates that the applicant need only provide information for an application to be accepted. In her affidavit, Ms. Manning deposed:
I disagree with the suggestion at paragraph 9 of Silvio’s Affidavit that aggregate permits are typically deemed complete once the Ministry receives all reports that meet the requirements under both the Provincial Standards and Ministry Policies. As set out above, the Provincial Standards require only that an applicant provide the information required under the Provincial Standards for a determination of completeness. Accordingly, the Ministry considers compliance with Ministry Policies after an application is determined to be complete.
Furthermore, and as a practical matter, the Ministry would not be able to make a determination of completeness in 15 days, as required under the Provincial Standards, if the Ministry were also reviewing all permit applications at this juncture for compliance with Ministry Policies. For example, Ministry Policy A.R. 4.01.06, which applies to the Natural Environment Report, requires that the determination of whether certain species and habitat exist on site must be made through a site visit, and at a time of year when such species would be expected to be visible. Often times, a Natural Environment Report does not contain information obtained from site visits, or the time of year the visit occurred was not appropriate for the species of potential and thus the Ministry directs the applicant to update the report as appropriate. For certain species of potential, the site visit may need to wait until the Spring or Summer, regardless of when the application was submitted to the Ministry.
[83] Given its position that the impugned Ministry Policies do not apply to the initial phase of the application process, the Ministry submits that Milne submitted sufficient information for a complete application and, as such, the Decision was reasonable. The Ministry did not, however, specify the criteria it used to deem Milne’s application as being complete.
THE LAW
Reasonableness
[84] Applications for judicial review begin with presumption that courts will review the decisions of administrative decision makers on the basis of reasonableness. As the majority of the Supreme Court of Canada stated at paras. 82 and 83 of Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65:[^11]
Reasonableness review aims to give effect to the legislature's intent to leave certain decisions with an administrative body while fulfilling the constitutional role of judicial review to ensure that exercises of state power are subject to the rule of law: see Dunsmuir, at paras. 27-28 and 48; Catalyst Paper Corp. v. North Cowichan (District), 2012 SCC 2, [2012] 1 S.C.R. 5, at para. 10; Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island, [1997] 3 S.C.R. 3, at para. 10.
It follows that the focus of reasonableness review must be on the decision actually made by the decision maker, including both the decision maker's reasoning process and the outcome. The role of courts in these circumstances is to review, and they are, at least as a general rule, to refrain from deciding the issue themselves. Accordingly, a court applying the reasonableness standard does not ask what decision it would have made in place of that of the administrative decision maker, attempt to ascertain the "range" of possible conclusions that would have been open to the decision maker, conduct a de novo analysis or seek to determine the "correct" solution to the problem. The Federal Court of Appeal noted in Delios v. Canada (Attorney General), 2015 FCA 117, 472 N.R. 171, that"as reviewing judges, we do not make our own yardstick and then use that yardstick to measure what the administrator did": at para. 28; see also Ryan, at paras. 50-51. Instead, the reviewing court must consider only whether the decision made by the administrative decision maker -- including both the rationale for the decision and the outcome to which it led -- was unreasonable.
[85] At paras. 94 to 96 of Vavilov, the majority of the Supreme Court focussed on the need to interpret an administrative decision in light of its legal and factual framework:
The reviewing court must also read the decision maker's reasons in light of the history and context of the proceedings in which they were rendered. For example, the reviewing court might consider the evidence before the decision maker, the submissions of the parties, publicly available policies or guidelines that informed the decision maker's work, and past decisions of the relevant administrative body. This may explain an aspect of the decision maker's reasoning process that is not apparent from the reasons themselves or may reveal that an apparent shortcoming in the reasons is not, in fact, a failure of justification, intelligibility or transparency. Opposing parties may have made concessions that had obviated the need for the decision maker to adjudicate on a particular issue; the decision maker may have followed a well-established line of administrative case law that no party had challenged during the proceedings; or an individual decision maker may have adopted an interpretation set out in a public interpretive policy of the administrative body of which he or she is a member.
That being said, reviewing courts must keep in mind the principle that the exercise of public power must be justified, intelligible and transparent, not in the abstract, but to the individuals subject to it. It would therefore be unacceptable for an administrative decision maker to provide an affected party formal reasons that fail to justify its decision, but nevertheless expect that its decision would be upheld on the basis of internal records that were not available to that party.
Where, even if the reasons given by an administrative decision maker for a decision are read with sensitivity to the institutional setting and in light of the record, they contain a fundamental gap or reveal that the decision is based on an unreasonable chain of analysis, it is not ordinarily appropriate for the reviewing court to fashion its own reasons in order to buttress the administrative decision. Even if the outcome of the decision could be reasonable under different circumstances, it is not open to a reviewing court to disregard the flawed basis for a decision and substitute its own justification for the outcome: Delta Air Lines, at paras. 26-28. To allow a reviewing court to do so would be to allow an administrative decision maker to abdicate its responsibility to justify to the affected party, in a manner that is transparent and intelligible, the basis on which it arrived at a particular conclusion. This would also amount to adopting an approach to reasonableness review focused solely on the outcome of a decision, to the exclusion of the rationale for that decision. To the extent that cases such as Newfoundland Nurses and Alberta Teachers have been taken as suggesting otherwise, such a view is mistaken. [Emphasis added.]
Policies and Governmental Decision-Making
[86] Neither party emphasized the jurisprudence that has developed regarding the interplay between statutes and government policy, even though this area of law is at the heart of the case before the court. The Supreme Court of Canada dealt with the role that government policies have in government decision-making at para. 131 of Vavilov:
Whether a particular decision is consistent with the administrative body's past decisions is also a constraint that the reviewing court should consider when determining whether an administrative decision is reasonable. Where a decision maker does depart from longstanding practices or established internal authority, it bears the justificatory burden of explaining that departure in its reasons. If the decision maker does not satisfy this burden, the decision will be unreasonable. In this sense, the legitimate expectations of the parties help to determine both whether reasons are required and what those reasons must explain: Baker, at para. 26. We repeat that this does not mean administrative decision makers are bound by internal precedent in the same manner as courts. Rather, it means that a decision that departs from longstanding practices or established internal decisions will be reasonable if that departure is justified, thereby reducing the risk of arbitrariness, which would undermine public confidence in administrative decision makers and in the justice system as a whole. [Emphasis added.]
[87] The British Columbia Superior Court recently synthesized the interplay between statute and policy in Minster Enterprises Ltd. v. Richmond (City), [2020] B.C.J. No. 495. At paras. 111 and 112 of Minster Enterprises Ltd., Crerar J. stated:
As a point supporting the City's submission, the Supreme Court of Canada has recognized the importance of policy in assessing the reasonableness of an administrative decision maker's interpretation of its governing statutory provisions. That Court has described such policies as forming part of the "broader context" of a provision whose interpretation is under review: Agraira v. Canada (Public Safety and Emergency Preparedness), 2013 SCC 36 at para. 85. Any applicable policy in effect when a decision is made can constitute "a useful indicator of what constitutes a reasonable interpretation of the . . . section": Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 SCR 817 at para. 72.
Continuing this reasoning, Vavilov emphasizes the importance of policy in guiding administrative decision-making as one of the primary means by which administrative bodies promote consistency between decisions, and guard against arbitrariness (at para. 130). In fact, a failure to adequately address an established policy or practice may be sufficient to render a decision unreasonable in itself: Vavilov at para. 131. Accordingly, Vavilov suggests that a reviewing court may consider "publicly available policies or guidelines that informed the decision maker's work" as part of the relevant context of a decision under review: para. 94.
[88] At paras. 113 and 114, Crerar J. considered the fact that policies do not bind decision makers but relevant policies must inform statutory decision-making:
Policies are not, however, binding law. They cannot be used to undermine the lawful limits on an administrative body's authority: Moya v. Canada (Citizenship and Immigration), 2012 FC 971 at para. 10. An unreasonable policy cannot save an unreasonable decision. In particular, where there is only one reasonable interpretation of a given provision, a decision-making body cannot override the lawful interpretation of its governing statute through issuance of a later policy, or otherwise. As explained in Vavilov:
Reasonableness review does not give administrative decision makers free rein in interpreting their enabling statutes, and therefore does not give them licence to enlarge their powers beyond what the legislature intended. Instead, it confirms that the governing statutory scheme will always operate as a constraint on administrative decision makers and as a limit on their authority. Even where the reasonableness standard is applied in reviewing a decision maker's interpretation of its authority, precise or narrow statutory language will necessarily limit the number of reasonable interpretations open to the decision maker -- perhaps limiting it one. Conversely, where the legislature has afforded a decision maker broad powers in general terms -- and has provided no right of appeal to a court -- the legislature's intention that the decision maker have greater leeway in interpreting its enabling statute should be given effect. Without seeking to import the U.S. jurisprudence on this issue wholesale, we find that the following comments of the Supreme Court of the United States in Arlington, at p. 307, are apt:
The fox-in-the-henhouse syndrome is to be avoided not by establishing an arbitrary and undefinable category of agency decision-making that is accorded no deference, but by taking seriously, and applying rigorously, in all cases, statutory limits on agencies' authority. Where [the legislature] has established a clear line, the agency cannot go beyond it; and where [the legislature] has established an ambiguous line, the agency can go no further than the ambiguity will fairly allow...
In other words, policy can and should shape the contours of acceptable decision-making under a given provision. However, it cannot transgress the limits of the authority delegated to decision makers under the relevant statue [sic]. Where the legislature has established a clear line -- for example, where the decision is reviewable on a correctness standard, or where there is only one reasonable interpretation of a given provision -- a policy cannot enlarge the scope of acceptable decision-making beyond that limitation. Where the provision is more ambiguous, a policy can only enlarge the scope of reasonableness as far as "the ambiguity will fairly allow". The City Bulletin's deeming provision, issued eight months after the Permits were issued, and 16 years after the enactment of the Building Bylaw, with its broad and plain wording, purports to exercise a quasi-legislative function beyond the conception of policy as contemplated by Vavilov. [Emphasis added.]
[89] In Alexion-Pharmaceuticals Inc. v. Canada (Attorney-General), 2021 FCA 157, the Federal Court of Appeal considered Vavilov’s holding that the failure to adhere to non-binding guidelines can render a decision unreasonable. The court in Alexion-Pharmaceuticals Inc. dealt with a case where the Patented Medicine Prices Review Board found that the price of a certain drug was too high based upon certain pricing factors. Stratas J.A., writing for the court, highlighted the relevant statutes and regulations at paras 34 and 35:
Section 85 is the law. The Board's analysis should start with the law. Whatever the Board does must be consistent with the law.
Subsection 85(1) empowers the Board to determine "whether a medicine is being or has been sold at an excessive price in any market in Canada". Five factors are relevant:
(a) "the prices at which the medicine has been sold in the relevant market";
(b) "the prices at which other medicines in the same therapeutic class have been sold in the relevant market";
(c) "the prices at which the medicine and other medicines in the same therapeutic class have been sold in countries other than Canada";
(d) "changes in the Consumer Price Index";
(e) "such other factors as may be specified in any regulations made for the purposes of this subsection".
If and only if after considering these factors the Board is unable to determine if a price is excessive, it may also consider "the costs of making and marketing the medicine and any other factors it considers relevant": s. 85(2).
[90] At paras 36 to 38, Stratas J.A. reviewed how statutes are to be interpreted in light of non-binding guidelines:
In an excessive pricing case, the Board must interpret section 85. It does so by considering its text, context and purpose: Vavilov at para. 120; Re Rizzo & Rizzo Shoes Ltd., [1998] 1 S.C.R. 27, 154 D.L.R. (4th) 193; Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559; Canada Trustco Mortgage Co. v. Canada, 2005 SCC 54, [2005] 2 S.C.R. 601. This also applies to the determination of the other relevant factors the Board may consider under subsection 85(2). In interpreting section 85, the Board must show that it is "alive to [the] essential elements" of text, context and purpose, at least "touch[ing] upon only the most salient aspects": Vavilov at paras. 120-122.
It must also interpret section 85 in a genuine, non-tendentious, non-expedient way: Vavilov at paras. 120-121. Result-oriented analysis is no part of the exercise: ibid.; see also Williams v. Canada (Public Safety and Emergency Preparedness), 2017 FCA 252, [2018] 4 F.C.R. 174 at paras. 41-52; Canada v. Cheema, 2018 FCA 45, [2018] 4 F.C.R. 328 at paras. 73-86; Hillier v. Canada (Attorney General), 2019 FCA 44, 431 D.L.R. (4th) 556 at paras. 18 and 24-27; Canada (Attorney General) v. Utah, 2020 FCA 224, 455 D.L.R. (4th) 714 at para. 15 (all in the context of courts but equally applicable to administrators).
The Board has enacted guidelines to assist itself and others in applying section 85: Patented Medicine Prices Review Board of Canada, Compendium of Policies, Guidelines and Procedures, updated February 2017, online: www.pmprb-cepmb.gc.ca. It has the power to do so: Patent Act, s. 96(4). The Guidelines themselves are only non-binding guidance, not law. They must be consistent with the law of the land, here section 85: Maple Lodge Farms Ltd. v. Government of Canada, [1982] 2 S.C.R. 2, 137 D.L.R. (3d) 558 at 6-7 S.C.R.; Kanthasamy v. Canada (Citizenship and Immigration), 2014 FCA 113, [2015] 1 F.C.R. 335 at para. 53, rev'd on another ground 2015 SCC 61, [2015] 3 S.C.R. 909. The Board has no power to amend section 85 through the Guidelines. [Emphasis added.]
[91] At para 39, Stratas J.A. made clear that a decision-maker could deviate from non-binding guidelines (or policy), but was required to provide cogent reasons for that decision:
As non-binding guidance, the Guidelines can be departed from. But any departures from the Guidelines must be reasonable, at least in the sense that they are not inconsistent with a reasonable interpretation of section 85. And there must be a reasoned explanation for any departures from the Guidelines. [Emphasis added.]
[92] Finally, at paras. 68 to 71 of his reasons, Stratas J.A. sent the matter back to the Board because, at the very least, the Board failed to provide a reasoned explanation for a departure from the relevant guidelines:
In making its remedial order, the Board did not consider the actual prices received by Alexion for Soliris. It had evidence of these before it. But it used list prices instead. As a result, the amount that Alexion was ordered to pay to the Crown included revenues that Alexion had never actually received. This does not appear to be consistent with the language of section 83 or its purpose. At a minimum, the Board never provides a reasoned explanation regarding how it is consistent with section 83.
F. Conclusion
For the foregoing reasons, the Board's decision cannot stand. It must be quashed and remitted to the Board for re-determination.
After receiving submissions from the parties on the redetermination, the Board is free to make whatever decision seems appropriate to it based on a reasonable interpretation of the legislation as applied to the evidence in the case. It may or may not reasonably find excessive pricing under section 85. If it does, it may or may not make a remedial order under section 83. If it does, that order may be higher or lower than the one previously made depending on how section 83, reasonably interpreted, applies to the evidence in the case. In making its decision, the Board must ensure that a reasoned explanation is discernable on the key issues--the issues on which the case will turn and the issues of prime importance raised in the parties' submissions.
Transparency, Accountability and Reasonableness
[93] Government transparency and accountability also factor into a court’s reasonableness analysis. The importance of transparency and accountability are particularly noteworthy in situations where, like here, a government decision is not made via an open adjudicative process. Such a situation confronted the Federal Court of Appeal in Appleby-Ostroff v Canada (Attorney General), 2011 FCA 84 where a Treasury Board policy had been revoked and replaced. The Treasury Board argued that the former policy continued to apply to the applicant. The Federal Court of Appeal rejected that position and, at para. 38 of their decision, stated:
Transparency and accountability are important principles that apply to government actions, particularly where such actions affect individual rights. As recently noted by Binnie J."[t]he transparency and accountability of government are issues of enormous public importance" (R. v. National Post, 2010 SCC 16, [2010] 1 S.C.R. 477 at para. 70). These principles are not promoted by allowing government officials to claim "secret" undisclosed exceptions to publicly available policies and rules affecting individual rights in the absence of clear statutory authority to do so.
ANALYSIS
Application of Ministry Policies to the Completeness Analysis
[94] As noted above, Lempiala takes the position that a complete application must strictly comply with the Provincial Standards and Ministry Policies that describe the contents of documents like the Summary Statement and the NEL 1. Accordingly, a complete application must include:
a. A Summary Statement based on a site visit;
b. An NEL 1 report based on a site visit; as well as
c. A completed Cultural Heritage Report.
[95] The Ministry, on the other hand, takes the position that said Ministry Policies do not apply at the completeness stage but are only relevant to the Notification/Consultation stage of the application process.
[96] Neither Lempiala nor the Ministry are correct in this regard.
[97] Section 7 of the Regulation adopts the Provincial Standards. Accordingly, the Provincial Standards becomes the “law” that supersedes guidelines and policy, as was stated by Stratas J.A. in Alexia-Pharmaceuticals Inc. The Provincial Standards are thus the basis by which the Ministry is to determine the completeness of an application.
[98] It bears remembering that the operative portion of the Provincial Standards states that:
2.0 Report Standards for Category 9 Applications
2.2 Technical Reports
Technical Reports accompanying an application for an aggregate permit must provide information on the following:
2.2.1 Natural Environment Level 1:… [emphasis added]
[99] A plain reading of the relevant Provincial Standards, therefore, requires an applicant to “provide information” regarding certain enumerated items, including reports defined by Ministry Policies[^12]. It does not necessitate that every report submitted with a complete application contain every piece of evidence or analysis as specified by the Ministry Policies. The “law” does not require such strict compliance. It merely requires that a complete application “provide information” about same.
[100] The Aggregate Policy, however, stipulates that:
Technical Reports
It is a requirement under the Provincial Standards that all permit applications shall include all appropriate reports. The reports must be prepared in accordance with Section 2.0 Report Standards (see A.R. 4.01.04 through A.R. 4.01.08) for the Category being applied for under the Provincial Standards, and be submitted as part of the application package. [Emphasis added.]
[101] The Aggregate Policy is mandatory in that it states that “reports must be prepared in accordance with Section 2.0 Report Standards (see A.R. 4.01.04 through A.R. 4.01.08)” [emphasis added]. The Ministry’s decision to depart from the mandatory nature of the Aggregate Policy thus requires a “reasoned explanation” as per Alexion-Pharmaceuticals Inc. For example, where the Ministry decides that it does not require an NEL 1 site visit in order to satisfy the completeness analysis, it must provide a “reasoned explanation” for that decision.
[102] I am mindful of the fact that the Ministry submitted that requiring an extensive review of submitted materials at the application phase is unrealistic given that the Ministry must make a completeness determination within fifteen days of receipt of an application. Although this submission has superficial appeal, two issues come to mind. First, the Ministry provided no specific evidence as to why it could not vet applications for compliance with Ministry Policies within fifteen days. The court received no evidence as to how many applications are submitted to the Ministry or how long it would take to vet those applications. Second, I note that the Ministry took much longer than fifteen days to deem Milne’s application complete and it is unclear why the Ministry was unconcerned with this statutory time limit in the instant case. While the Ministry’s argument may have ultimate merit, the lack of evidence in this regard and the Ministry’s improper application of the scheme governing the application process do not permit me to give any weight to this argument.
[103] I now turn to Lempiala’s specific submissions. Lempiala submits that the Ministry made three discrete errors when it made the Decision. Each alleged error will be dealt with in turn.
Summary Statement – No Site Visit
[104] Lempiala submits that Milne’s Summary Statement failed to “determine the elevation of the water table within the site or demonstrate [that] the final depth of extraction is at least 1.5 metres above the water table” as contemplated by the Provincial Standards and Summary Statement Policy. The Summary Statement Policy states that applicants may use existing well data, surface water elevations of nearby water bodies or other means of testing to determine the elevation of the water table on-site. Where there is a lack of available information, “it will be necessary for the applicant to establish the water table by digging or drilling test holes”.
[105] With its application package, Milne submitted a Summary Statement that purported to establish the water table via a number of means, but not via a site visit.
[106] The Provincial Standards and the Ministry Policies do not require the author of the Summary Statement to conduct a site visit in order to determine the ground water table. The author must do so only if there is “a lack of available information” in this regard.
[107] I note that there were issues about the ultimate sufficiency of the information contained in Milne’s Summary Statement as evidenced by the concerns raised by the Ministry’s hydrogeologist. However, Lempiala furnished no expert evidence that Milne’s engineering consultant drew conclusions despite “a lack of available information”. It could be that a site visit is the preferrable manner of making the determination regarding the ground water table. It may be that a site visit is necessary in the circumstances. Nonetheless, there is no statutory, regulatory or Ministry Policy that requires such a site visit and Lempiala furnished no evidence that a site visit was necessary as a result of a “lack of available information”. In the absence of evidence that the Ministry hydrogeologist’s concerns were such that Milne’s expert lacked “available information”, there is no evidentiary basis for this court to find that Milne’s application was deficient.
[108] Accordingly, Lempiala’s submission regarding the Summary Statement is dismissed.
NEL 1 – No Site Visit
[109] The Provincial Standards demand that a complete application must “provide information” on, inter alia, “Natural Environment Level 1: determine whether any of the following features exist on and within 120 metres of the site: significant wetland, significant portions of the habitat of endangered or threatened species…”
[110] The Environmental Policy states that an NEL 1 must consider evidence obtained from a site visit:
The qualified individual [writing the NEL 1] must determine whether any of the above features exist during a site inspection/visit(s). Where there is a known presence of a feature based on existing information, or the site lies within the geographic range of a feature (e.g. endangered or threatened species) and the habitat is appropriate, the inspection must be carried out at a time when the feature would be expected to be visible, using good field observation and investigation practices. It is important to recognize that while some significant resources may already be identified and inventoried by official sources, the significance of others can only be determined after evaluation by the proponent/applicant. [Emphasis added.]
[111] As noted above, the wording “provide information” in the Provincial Standards does not demand that an applicant be held to a standard of strict compliance with the Environmental Policy. In this instance, Milne submitted an NEL 1 that contained the following statement:
A biologist has not completed a site visit, but has prepared this desktop study to investigate the surface features, drainage patterns, and natural environment within and surrounding the site. The site can be accessed via Gilbride Rd and a tertiary road network of forestry access roads within and around the proposed site.
[112] On April 26, 2018, Milne’s consultants emailed Ms. Manning to arrange a site visit to presumably ensure compliance with the Environmental Policy. This email exchange occurred before Ms. Hawkins’ May 26, 2018 letter confirming the Decision, but after the deeming date of March 23, 2018. Consequently, it must be that the Ministry did not require an NEL 1 site visit in order to deem an application as being complete.
[113] As noted above, the Ministry is required to provide a “reasoned explanation” for the departure from Environmental Policy’s mandatory requirement for a site visit as part of an NEL 1 for the purposes of a completeness analysis. The Ministry did not provide any evidence to this court explaining why it did not deem a site visit necessary in the circumstances. Ms. Manning’s April 25/26, 2018 email exchange with Milne’s consultants may suggest a possible rationale for the Ministry’s decision given the timing of migratory birds’ flight and mating seasons. Nonetheless, the Ministry furnished no evidence that the Ministry in fact considered said timing as the basis for dispensing with the site visit requirement. Given this lack of evidence, it cannot be said that the Ministry provided a “reasoned explanation” for its departure from a mandatory policy requiring an NEL 1 site visit in a complete application.
[114] In the absence of any evidence regarding its decision-making rationale or any reasons addressing same, the Ministry cannot be said to have been reasonable in arriving at the Decision.
Cultural Heritage Report
[115] The Provincial Standards state that
Technical Reports accompanying an application for an aggregate permit must provide information on the following:
2.2.3 Cultural Heritage Resource Stage 1: determine if there are any known significant archaeological resources on the subject property and the potential of the site to have heritage resources. [Emphasis in original.]
[116] On February 13, 2018, Milne submitted an out-of-date cultural checklist along with an email from MTCS indicating that, based on information furnished by Milne to MTCS, the likelihood of meaningful archaeological impact from Milne’s proposed operation was low. Milne’s submission was deemed complete effective March 23, 2018, or 15 days after Milne provided the Ministry with the information that Milne had previously provided to the MTCS. The Ministry required Milne to submit an up-to-date checklist after the completeness determination (and after the Ministry’s receipt of Lempiala’s application).
[117] The Ministry provided no evidence to this court as to why an out-of-date checklist coupled with other, unspecified information was sufficient for the completeness analysis. This court cannot discern the rationale for this decision, especially given MTCS’s statement that the completion of an up-to-date checklist may yield different results. It is impossible to determine whether the reasoning is internally rational and whether it is justifiable in light of the relevant factual and legal constraints. It is not possible to determine whether the outcome is defensible in light of the facts and the law.
[118] In the absence of any such evidence or any reasons addressing these concerns, the Ministry cannot be said to have been reasonable in arriving at the Decision since there is no basis to suggest that the information provided by Milne satisfies the Cultural Heritage Policy. I am satisfied that the failure to file such evidence is not superficial or peripheral to the merits of the Decision, but rather is central to the Decision so as to render the Decision unreasonable.
Conclusion
[119] The Decision is unreasonable and is therefore quashed.
Remedy
[120] Lempiala seeks an order in the nature of mandamus requiring the Ministry to consider its application, rather than Milne’s application.
[121] Orders in the nature of mandamus are governed by an eight-part test articulated by the Federal Court of Appeal in Apotex Inc. v. Canada (Attorney General), [1994] 1 FC 742 (FCA):
a. The party against whom the order is made has a public legal duty to act;
b. The duty must be owed to the applicant;
c. The applicant must have a clear right to the performance of that duty;
d. Where the duty sought to be enforced is discretionary, certain rules apply;
e. There is no other adequate alternative remedy available to the applicant;
f. The order sought will be of some practical value or effect;
g. There is no equitable bar to the relief sought; and
h. The balance of convenience favours granting an order in the nature of mandamus.
[122] With regard to the test described in Apotex, the simple reality is that the Ministry has failed to provide this court with any metrics governing the application stage. It is clear that the Ministry will work proactively with applicants prior to the submission of an application. Nonetheless, in the absence of such a prior consultation, a person or organization seeking to operate a pit or a quarry on Crown land has no idea what information needs to be provided to the Ministry at the initial phase of the application process in order to be deemed complete, or the metrics by which that information will be scrutinized. Accordingly, it cannot be said that the balance of convenience favours granting an order in the nature of mandamus since it could well be that Milne provided sufficient information to the Ministry regarding the NEL 1 and Cultural Heritage Report in its application so as to be deemed complete. The absence of any rules or metrics regarding these standards are such that this court is not in a position to decide that Milne’s application is deficient, thereby requiring the Ministry to consider Lempiala’s application. The appropriate result is for the matter to be remitted back to the Ministry for reconsideration. I note that this result is similar to the one reached in Alexion-Pharmaceuticals Inc.
[123] Lempiala’s request for an order in the nature of mandamus is therefore dismissed.
CONCLUSION
[124] The Ministry’s May 16, 2018 decision to deem Milne’s application as being complete effective March 23, 2018 is hereby quashed. The May 16, 2018 decision is set aside, as are all subsequent decisions which flow from, and are dependent upon, that finding.
COSTS
[125] At the end of the hearing, the parties agreed that the unsuccessful party would pay $30,000 (all inclusive) in costs.
[126] Lempiala was largely successful on this application for judicial review. After considering Rule 57.01 of the Rules of Civil Procedure, I am satisfied that the parties’ agreement on costs is reasonable.
[127] Therefore, the Ministry shall pay Lempiala $30,000 (all inclusive) within 30 days of today’s date.
Varpio J.
I agree Morawetz C.J.
I agree Kristjanson J.
Released: February 2, 2022
CITATION: Lempiala Sand v. HMQ, 2022 ONSC 248
DIVISIONAL COURT FILE NO.: DC 399/20
DATE: 20220202
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Morawetz C.J., Varpio, Kristjanson, JJ.
BETWEEN:
LEMPIALA SAND & GRAVEL LIMITED
- and –
HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO AS REPRESENTED BY THE MINISTRY OF NATURAL RESOURCES AND FORESTRY
REASONS FOR decision
Released: February 2, 2022
[^1]: Neither party disputes the legitimacy of the first-come, first-served policy. Consequently, I will not address whether it is a reasonable policy.
[^2]: It should be noted that Milne was provided with a copy of the application for judicial review but has chosen not to participate in the instant proceedings.
[^3]: Of note, Lempiala applied for a Category 9 permit while Milne applied for Category 9 and 11 permits.
[^4]: Given that the relevant portions of the Provincial Standards governing Category 9 and Category 11 applications have identical wording, for the sake of simplicity, only Category 9 references will be reproduced in these reasons.
[^5]: There was some confusion in the application materials regarding: (a) whether Mr. Di Gregorio was acting on Lempiala’s behalf or on the behalf of a related company; and (b) whether Lempiala took the position that this initial inquiry by Mr. Di Gregorio constituted a complete application. Nothing turns on these two issues as the Ministry accepts that Mr. Di Gregorio was representing Lempiala, and Lempiala appears to accept that this initial communication did not constitute a complete application.
[^6]: Lempiala took issue with the fact that this initial communication was allegedly initially misfiled by the Ministry. Nothing turns on this issue.
[^7]: Lempiala did not file any expert evidence suggesting that North Rock’s Summary Statement was incorrect or relied upon impermissible scientific methodology.
[^8]: Several maps and other documents were filed by the Ministry but the Ministry did not specify whether these documents were received on March 8, 2018.
[^9]: Mr. Silvio Di Gregorio swore an affidavit on Lempiala’s behalf.
[^10]: These reasons should not be taken as a criticism of Ms. Manning’s efforts. Nothing in the record suggests that she failed to conduct herself in an assiduous fashion.
[^11]: It should be noted that Vavilov was released after the events that gave rise to the instant litigation.
[^12]: For a review of the jurisprudence governing statutory interpretation, see R. v. Walsh, 2021 ONCA 43 at paras. 59 and 60.