Supreme Court of Canada

Fulton et al. v. Energy Resources Conservation Board et al., [1981] 1 S.C.R. 153

Date: 1981-01-27

Robert Fulton, Carl Friesz and Lance Wheeler Appellants;

and

Energy Resources Conservation Board and Calgary Power Ltd. Respondents;

and

The Attorney General of Alberta, the Attorney General of Canada, the Attorney General of Ontario, the Attorney General of Quebec, the Attorney General of New Brunswick, the Attorney General of British Columbia, the Attorney General of Manitoba and the Attorney General of Newfoundland Interveners.

1980: November 24; 1981: January 27.

Present: Laskin C.J. and Martland, Ritchie, Dickson, Estey, McIntyre and Chouinard JJ.

ON APPEAL FROM THE COURT OF APPEAL OF ALBERTA

Constitutional law—Jurisdiction—Application by power company for approval by provincial board of construction of transmission line within province to point near provincial border—Connection to power system of another province proposed—Whether or not the project a work or undertaking connecting the provinces and therefore within area of exclusive federal legislative competence—British North America Act, s. 92(10)(a)—The Hydro and Electric Energy Act, 1971 (Alta.), c. 49, ss. 14(2)(b), 14(2.1).

This appeal concerned a constitutional question engaging s. 92(10)(a) of the British North America Act. Calgary Power Ltd. applied under Alberta’s Hydro and Electric Energy Act to the Alberta Energy Resources Conservation Board for approval of the construction and operation of an electrical transmission line to a point near the Alberta-British Columbia border where it would interconnect with one to be built in British Columbia. The application was opposed by landowners in the area of the project and, unless the Board had the jurisdiction to entertain and act upon the application, the expropriations necessary to the project could not be realized. No federal regulatory agency embraced the situation. Respondent company did not challenge Parliament’s regulatory power, at least at the point of interconnection, should Parliament choose to act. Further, the Alberta Energy Resources Conservation Board did not purport to exercise any regulatory control over the relations between respondent and B.C. Hydro under their agreement.

Appellants appealed from a decision of the Alberta Court of Appeal confirming the Board’s assertion of jurisdiction, contending that the application was one to approve and permit an undertaking within exclusive federal legislative authority by reason of the contemplated interprovincial connection.

Held: The appeal should be dismissed.

An electrical distribution system could competently be within s. 92(10)(a). In the absence of federal legislation, the provincial legislature’s authorization of a provincial statutory board to entertain applications for the construction of intraprovincial facilities and to empower an applicant to connect its local facilities with those of an agency in an adjoining province but without presuming to regulate the interconnection fell within the provincial authorization in relation to local works and undertakings. There was no operative federal legislation to underscore federal exclusiveness or to support federal paramountcy. Although exclusiveness could arise even in the absence of federal legislation, the present situation did not provide a basis for its assertion. There was no single promoter in a position to effect on his own an interprovincial connection and the proposed works in Alberta, ninety-nine per cent of whose output was to be delivered to customers within the Province, could properly be regarded as local or intraprovincial for the purposes of the application that was before the Energy Resources Board.

The prospect of a federal legislative interest when an interconnection was made with the facilities in British Columbia was not enough to bring this case within s. 92(10)(a) when there was no applicable federal legislation. The decision of the Board, in so far as it approved interconnection with British Columbia facilities, was merely permissive. The application was merely to enable Calgary Power Ltd. to reap the benefits of interconnection when made, as it saw fit, with the Board, for the present, being asked to approve the construction and operation of facilities wholly within Alberta.

Quebec Railway Light & Power Co. v. Beauport, 1944 CanLII 49 (SCC), [1945] S.C.R. 16, considered; Hewson v. Ontario Power Company of Niagara Falls (1905), 1905 CanLII 9 (SCC), 36 S.C.R. 596; Campbell-Bennett Ltd. v. Comstock Midwestern Ltd., 1954 CanLII 216 (SCC), [1954] S.C.R. 207; Saskatchewan Power Corp. et al. v. TransCanada Pipelines Ltd., 1978 CanLII 163 (SCC), [1979] 1 S.C.R. 297; Kootenay and Elk Railway Company and Burlington Northern, Inc. v. Canadian Pacific Railway Company, 1972 CanLII 182 (SCC), [1974] S.C.R. 955; Ottawa Valley Power Co. v. Attorney-General of Ontario et al., 1937 CanLII 99 (ON CA), [1936] 4 D.L.R. 594; Luscar Collieries, Limited v. McDonald and Others, 1927 CanLII 472 (UK JCPC), [1927] A.C. 925; Attorney-General of Ontario v. Winner, 1954 CanLII 289 (UK JCPC), [1954] A.C. 541, distinguished; Toronto v. Bell Telephone Co., [1905] A.C. 52, referred to.

APPEAL from a judgment of the Court of Appeal of Alberta[^1], confirming the jurisdiction asserted by the Alberta Energy Resources Conservation Board. Appeal dismissed.

L.M. Sali and A.S. Hollingworth, for the appellants.

Michael J. Bruni, for the respondent Energy Resources Conservation Board.

D.O. Sabey, Q.C., and H.M. Kay, for the respondent Calgary Power Ltd.

William Henkel, Q.C., for the Attorney General of Alberta.

T.B. Smith, Q.C., for the Attorney General of Canada.

John Cavarzan, Q.C., for the Attorney General of Ontario.

Henri Brun and André Beaulieu, for the Attorney General of Quebec.

Alan D. Reid and Bruce Judah, for the Attorney General of New Brunswick.

E. Robert A. Edwards, for the Attorney General of British Columbia.

N.D. Shende and R. Perozzo, for the Attorney General of Manitoba.

James A. Nesbitt, Q.C., for the Attorney General of Newfoundland.

The judgment of the Court was delivered by

THE CHIEF JUSTICE—This appeal from a judgment of the Alberta Court of Appeal dated January 22, 1980, is here by leave of this Court given on April 22, 1980, and concerns a constitutional question which in an amended form, fixed by an order of September 8, 1980, reads as follows:

Does the Province of Alberta have constitutional power to authorize its Energy Resources Conservation Board to entertain an application authorizing the construction and operation of transmission lines intended to interconnect or tie in with electrical facilities operated in another Province and to serve any or all of the following purposes, as set out in the Agreed Statement of Facts:

(I) to provide generation capacity reserve;

(II) mutual assistance for emergencies in either system;

(III) mutual overall operating economies by energy-capacity interchange;

(IV) sale or exchange of surplus power or energy between Alberta and British Columbia;

(V) mutual assistance in meeting reserve and reliability requirements;

(VI) 500 kV back-up transmission in Alberta and British Columbia;

(VII) to allow for the export of electrical power to the United States of America;

(VIII) to form part of a 500 kV Transmission Network within Alberta.

The issues in this case engage s. 92(10)(a) of the British North America Act and arise out of an application to the Alberta Energy Resources Conservation Board by the respondent Calgary Power Ltd., a federally incorporated company, for certain permits. The application, made on December 12, 1978, under The Hydro and Electric Energy Act, 1971 (Alta.), c. 49, sought approval of the Board for the construction and operation of a new substation in the Langdon area near Calgary and a 500 kV electrical transmission line from Langdon to a point in Phillips Pass, Alberta, near the Alberta-British Columbia border.

Section 92(10)(a) of the British North America Act exempts from exclusive provincial legislative authority in relation to local works and undertakings such as are in the class of “Lines of Steam or other Ships, Railways, Canals, Telegraphs, and other Works and Undertakings connecting the Province with any other or others of the Provinces, or extending beyond the Limits of the Province”. This class (as well as those in s. 92(10)(b) and (c), which are not relevant here) is by force of s. 91(29) of the British North America Act brought within the exclusive competence of the Parliament of Canada.

It is clear from the facts in this case that the only concern is whether the concluding words of s. 92(10)(a) (“other Works and Undertakings connecting the Province with any other or others of the Provinces, or extending beyond the Limits of the Province”) apply here to exclude jurisdiction in the Alberta Energy Resources Conservation Board to entertain and act upon the respondent Calgary Power Ltd.’s application. There is no challenge here to the power of the Board to entertain and act upon the application under relevant authorizing legislation. The admitted purpose of the application is to provide a transmission line to interconnect with a line to be built by British Columbia Hydro and Power Authority from Cranbrook in that Province to the border point.

There is an agreed statement of facts in this case, of which the following paragraphs are relevant:

2. The purpose of the subject transmission line and the interconnection with British Columbia Hydro and Power Authority is stated by Calgary Power Ltd. to be to provide generation capacity reserve required in 1983 and beyond. In addition, both Calgary Power Ltd. and British Columbia Hydro and Power Authority derive a number of other benefits identified in the Application as including:

(a) mutual assistance for emergencies in either system;

(b) overall operating economics by energy-capacity interchange, that is, either utility can rely upon and use the other utility so as to help minimize the cost of building addition [sic] facilities;

(c) sale or exchange of surplus power or energy, that is, for example, if British Columbia Hydro and Power Authority has an excess amount of water in its hydro reservoirs which it is spilling (not using to generate power) it can generate power and sell it to Calgary Power, presumably at a cost less than Calgary Power could generate power at that point in time;

(d) mutual assistance in meeting reserve and reliability requirements, particularly during periods when for example new power plants are delayed;

(e) 500 KV back-up transmission in Southern Alberta and South-eastern British Columbia.

In addition, Calgary Power Ltd., 500 KV line facilitates the export of power ultimately destined for utilities in the United States. An application to export has not been filed for this purpose by Calgary Power Ltd., although it is being prepared, and there are no existing approvals from the National Energy Board. The proposed transmission line is not dependant in any way upon such use, and it is Calgary Power Ltd.’s position that it intends to construct the line whether or not export approval is obtained.

3. Calgary Power Ltd. is interconnected with the other electric utilities in Alberta at many locations throughout Alberta and has had interconnection with utilities in British Columbia since 1929. Interconnections are generally recognized in the electric utility industry as a way to provide large scale low cost diversity, to share reserve generating capacity and to most efficiently utilize existing generating capacity.

4. Calgary Power Ltd. and British Columbia Hydro and Power Authority will separately construct their transmission lines in their respective Provinces and will connect the two transmission lines at the British Columbia-Alberta border by means of what is known as a “deadend” tower, that is one which can withstand the mechanical tension of a line connected to one side only and does not need the support of a line on the opposite side. Calgary Power Ltd. will construct its line up to the Alberta side of the dead end tower and British Columbia Hydro and Power Authority will construct its line up to the British Columbia side. And, either utility could remove its line from the tower without forcing the other to remove or reinforce its line.

5. Calgary Power Ltd. will retain control of, and responsibility for, its transmission line constructed in Alberta and will retain the ability to connect or disconnect the line to the rest of its system by a breaker at the proposed Langdon substation at will. B.C. Hydro and Power Authority will have similarly retained control over and responsibility for its transmission line in British Columbia, at its Cranbrook substation. Calgary Power Ltd. will be able to connect generation and load to its line in Alberta at its sole discretion. The two parties will not make any agreement which would deprive either of this unfettered control.

6. Calgary Power Ltd.’s operations and customers are almost exclusively within the Province of Alberta. From time to time, it serves customers outside of the Province of Alberta where it is more economical and convenient for it to provide the service than adjacent utilities. At present of Calgary Power Ltd.’s approximately Two Hundred and Twenty-Eight Thousand (228,000) customers, less than ten are located outside the Province of Alberta, and represent less than 0.1% of the utility’s peak load.

7. British Columbia Hydro and Power Authority is the major electric utility in the Province of British Columbia, serving most of that Province. It holds a National Energy Board Licence or licences to export electric energy to the United States. It exports and imports electrical energy to and from the United States of America through electrical transmission interconnections with members of Northwest Power Pool along the international border.

8. The Northwest Power Pool is a mutually co-operative, unincorporated body set up by electric utilities in the northwestern United States. There are presently 20 participating utilities in the Pool, including three Canadian utilities. British Columbia Hydro and Power Authority, East Kootenay Power and Calgary Power Ltd.

As part of its application, Calgary Power Ltd. filed a letter of agreement between it and British Columbia Hydro which states that the proposed interconnection will allow for

(a) mutual assistance for emergencies in either system

(b) overall operating economics by energy-capacity interchange

(c) sale or exchange of surplus power or energy

(d) mutual assistance in meeting reserve and reliability requirements particularly during periods when new plant is delayed for reasons beyond the utilities’ control

(e) 500 kV transmission backup.

The application of Calgary Power Ltd. was opposed by farmers and landowners in the area of the proposed construction of the power substation and electrical transmission line. It is obvious, of course, that unless there is jurisdiction in the Alberta Energy Resources Conservation Board to entertain and act upon the application, the necessary expropriations of land to enable the project to proceed could not be realized. The Board asserted jurisdiction in a decision of June 18, 1979 and on an appeal to the Alberta Court of Appeal that Court confirmed the jurisdiction. Subsequently, the Board proceeded with the application during the pendency of the appeal to this Court and in a decision in early July, 1980 it granted Calgary Power Ltd.’s application for

(1) a substation near Langdon

(2) a 500-Kilovolt transmission line from the substation to Phillips Pass on the Alberta‑British Columbia border, and

(3) the interconnection of the transmission line and substation with Calgary Power’s existing transmission system and with the system of B.C. Hydro.

The submission of the appellants is that a provincial board is being asked to entertain an application to approve and permit an undertaking which is within exclusive federal legislative authority by reason of the contemplated interprovincial interconnection. At most, according to the appellants, it might be open to the Board to authorize the intraprovincial construction but not the interprovincial connection. Moreover, so the contention went, it was not open to the provincial legislature to vest the Board with jurisdiction to deal with the application of Calgary Power Ltd. in the terms in which it was made. Reliance is placed by the appellants on the pipeline cases: e.g. Campbell-Bennett Ltd. v. Comstock Midwestern Ltd.[^2] and Saskatchewan Power Corp. et al. v. Trans Canada Pipelines Ltd.[^3], on Hewson v. The Ontario Power Company of Niagara Falls[^4], at pp. 608-9, on certain observations in Ottawa Valley Power Co. v. Attorney-General of Ontario[^5], and in the reasons of Martland J. in Kootenay and Elk Railway Company and Burlington Northern, Inc. v. Canadian Pacific Railway Company[^6]. Invoked as well were the judgments of the Privy Council in Luscar Collieries, Limited v. McDonald and Others[^7] and Attorney-General of Ontario v. Winner[^8].

There are a number of important background facts which are relevant to the proper disposition of this appeal. First, it is conceded that there is no existing federal regulatory authority that embraces the situation that is presented here. Second, the respondent Calgary Power Ltd. does not challenge the regulatory power of Parliament, at least at the point of interprovincial interconnection, if Parliament should choose to act. At the present time, however, the federal National Energy Board is not vested with regulatory authority that would bring the project in this case within its regime of control. Third, it does not appear that the Alberta Energy Resources Conservation Board purports to exercise any regulatory control over the relationship between Calgary Power Ltd. and the British Columbia Hydro and Power Authority under their agreement. The situation, apart from the intraprovincial construction and operation of the power substation and the electrical transmission line and apart from the permission to interconnect with a line extending from within British Columbia to the Alberta border, seems to me to have some similarity to that considered by this Court in Quebec Railway Light & Power Co. v. Beauport[^9]. There it was decided that there was a gap in regulatory authority respecting tolls of an autobus service operated by an undertaking within federal jurisdiction, such tolls being at the same time not within provincial competence to prescribe. I appreciate that in the Beauport case there was actual federal regulatory authority but, as in the present case, it did not extend to the matter directly in issue. Unexercised federal authority may give leeway to the exercise of provincial authority in relation to local works and undertakings, and that is how I assess the situation here.

One matter lightly touched on by counsel for Calgary Power Ltd. but not pressed was whether an electrical distribution system could competently be within s. 92(10)(a). I do not doubt that it can be and the matter, in my view, is laid to rest by the judgment of this Court in Hewson v. Ontario Power Co., supra. That was a case, however, which, unlike the present one, turned on the existence of affirmative federal legislation. The same factor distinguishes, in my opinion, the pipeline cases. It is one thing for the Parliament of Canada to legislate affirmatively for the creation and regulation of an interprovincial pipeline, as in the Campbell‑Bennett Ltd. and Saskatchewan Power Corp. cases. The position is quite different where, absent superseding federal legislation, a provincial legislature authorizes a provincial statutory board to entertain applications for the construction of intraprovincial facilities and also to empower an applicant to connect its local facilities with those of an agency in an adjoining province but without presuming to regulate the interconnection. I regard this as falling within provincial authority in relation to local works and undertakings.

A relevant comparison may be made with the judgment of this Court in the Kootenay and Elk case, supra. There, a provincially incorporated company was authorized to build a railway line in British Columbia to extend to a point just within that Province at a fraction of an inch from the United States border. It was part of a scheme for junction with a line of railway to be built on the United States’ side of the border and to come within a fraction of an inch thereat. It was conceded that the lack of actual physical interconnection would not prevent trains from running effectively over the two lines. The purpose of the two lines was to permit the transport of coal from British Columbia through the United States and thence to a British Columbia port for shipment to Japan. Although federal railway legislation was involved in the case and a number of issues therein concerned the scope of the powers of the Canadian Transport Commission under that legislation, the important point for present purposes was the view of the majority of this Court (confirming in this respect the position taken by the Canadian Transport Commission) that at the particular stage of the project it could not be said that the provincial company was operating an extraprovincial undertaking. In the course of his reasons, Martland J. said this (at pp. 979-80):

The respondent contends, however, that, while Kootenay’s works do not extend beyond the province, its undertaking was not local in character. But in determining the legislative power of the British Columbia Legislature to incorporate Kootenay we are concerned with the nature of the undertaking which it authorized. That undertaking is one which is to be carried on entirely within the province. I do not overlook the fact that its undertaking when coupled with that of Burlington would provide a means of transport of goods from British Columbia into the United States. It may be, as is pointed out in the reasons of the Commission, that when the two lines are joined an overall undertaking of international character will emerge. But in my opinion that possibility did not preclude the British Columbia Legislature from authorizing the incorporation of a company to construct a railway line wholly situate within the borders of the province.

And, again (at p. 982):

In summary, my opinion is that a provincial legislature can authorize the construction of a railway line wholly situate within its provincial boundaries. The fact that such a railway may subsequently, by reason of its interconnection with another railway and its operation, become subject to federal regulation does not affect the power of the provincial legislature to create it.

There was a cogent dissent in the Kootenay and Elk case, but even accepting its merit by reason of the existence of federal railway legislation the present case is an important step removed, there being here no operative federal legislation to underscore federal exclusiveness or to support federal paramountcy. Although exclusiveness may arise even in the absence of federal legislation, I do not regard the situation presented here as providing a basis for its assertion.

Nor do I think that the appellants can find any comfort in the Hewson case, supra, for their attack on the jurisdiction of the provincial Board or on the authority conferred upon it under relevant provincial legislation. That case involved the validity of a federal incorporating statute respecting the generation of electricity by the incorporated company which was given expropriation powers in connection with its undertaking. Although the actual works of the company were to be in Ontario, the Court construed the statute as embracing the extension of the company’s operations beyond the Province (per Davies J., Sedgewick J. concurring) or as involving federal power in relation to navigation (per Taschereau C.J.) or as being, by virtue of an assertion to that effect in the preamble, works for the general advantage of Canada under s. 92(10)(c) of the British North America Act (per Girouard and Idington JJ.). The appellants rely on certain observations of Davies J., such as the statement on p. 606 that “The objects of the company as defined by the Act contemplated … possible extension beyond the limits of one Province, and it is therefore just as much within the express exception of the British North America Act, 1867, as a telegraph or telephone company with like powers of extension”, citing Toronto v. Bell Telephone Co.[^10], and, again, on similar observations at p. 607.

It seems to me, however, that for present purposes the relevant observation of Davies J. is at p. 609, where he says this:

It is not necessary, however, for me to decide whether a grant by the legislature of the province to a company created by it to connect its wires with those of a foreign corporation, at the frontier, would be necessarily beyond its powers or would invalidate the charter altogether or simply in part. That question was not argued excepting incidentally because the validity of a provincial charter was not an issue on this appeal. Whether there exists a concurrent jurisdiction in the Dominion and the province to confer such a power I am not called upon now to decide. I do hold the power to exist in the Dominion Parliament; and that, because of its exercise with respect to this special corporation and also because of the general extent of the powers granted, the Act of incorporation here in question is legal and valid.

The recognition by him of a constitutional difference where there is affirmative federal legislation is pertinent here where there is no such affirmative legislation and where, in my opinion, the field is open for valid provincial legislation of the kind under which the Board has acted in this case, that is, legislation in relation to intraprovincial local works and undertakings.

It is true that in the Winner case, supra, provincial legislation was blunted notwithstanding that there was no existing federal legislation governing interprovincial and international motor bus service. However, that was because a provincial motor carrier board purported to regulate the operations of an international bus carrier which provided service from Boston into the Province (New Brunswick) and into an adjoining Province (Nova Scotia). It was held to be beyond the competence of the New Brunswick Motor Carrier Board, in purporting to license a foreign bus carrier to operate from Boston into the Province and on to Glace Bay in Nova Scotia, to forbid the carrier from embusing or debusing passengers in New Brunswick. As a fully operating interprovincial and international bus carrier, it was entitled to carry passengers from points outside New Brunswick to points within and vice versa without being subject to provincial regulation. The contrast between the Winner case and the present case is obvious. There the “work” was an indivisible operation in the transportation of persons internationally and along the same routes intraprovincially; and in that situation, the Court found that such a system could not be segmented into provincial and interprovincial components.

There are observations in the Privy Council’s reasons in the Winner case, as at pp. 574-5 of 1954 CanLII 289 (UK JCPC), [1954] A.C. 541, that suggest that an intention to operate interprovincially may be sufficient to take a work or undertaking outside of provincial regulatory authority or, if not intention alone, then by the taking of all necessary steps to interprovincial operation. That may be so where the interprovincial operation is in the hands of one promoter, as was the case in Winner and also in Toronto v. Bell Telephone Co., supra, cited in the Winner case, and which, however, turned on the presence of federal legislation. Here, however, there is no single promoter who is in a position to effect on his own an interprovincial connection and, in my view, the proposed works in Alberta may properly be regarded as local works for the purposes of the application that was before the Energy Resources Conservation Board.

Again, there is nothing in the Luscar Collieries case, supra, that assists the contentions of the appellants. The principal issue in that case was whether the federal Board of Railway Commissioners had jurisdiction over certain intraprovincial railways, constructed pursuant to provincial legislative authority, which were not only interconnected but were operated by the Canadian National Railways pursuant to certain agreements and in such a way as to enable traffic to pass over them to such parts of Canada as were served by the C.N.R. system. Again, the “work” which was the subject of the proceedings was a single indivisible transportation system engaged in interprovincial transport and, in connection therewith, there was some intraprovincial transport as well. In contrast, the “work” here is, in essence, an intraprovincial one, ninety-nine per cent of whose output is to be delivered to customers within the Province.

It was the view of the Privy Council in the Luscar Collieries case that in the circumstances of the case the two provincial railways were part of a continuous system of railways operated by the C.N.R. and connecting the province with other provinces. The Privy Council assessed the constitutional position as follows (at pp. 932-3):

Their Lordships agree with the opinion of Duff J. that the Mountain Park Railway and the Luscar Branch are, under the circumstances hereinbefore set forth, a part of a continuous system of railways operated together by the Canadian National Railway Company, and connecting the Province of Alberta with other Provinces of the Dominion. It is, in their view, impossible to hold as to any section of that system which does not reach the boundary of a Province that it does not connect that Province with another. If it connects with a line which itself connects with one in another Province, then it would be a link in the chain of connection, and would properly be said to connect the Province in which it is situated with other Provinces.

In the present case, having regard to the way in which the railway is operated, their Lordships are of opinion that it is in fact a railway connecting the Province of Alberta with others of the Provinces, and therefore falls within s. 92, head 10 (a), of the Act of 1867. There is a continuous connection by railway between the point of the Luscar Branch farthest from its junction with the Mountain Park Branch and parts of Canada outside the Province of Alberta. If under the agreements hereinbefore mentioned the Canadian National Railway Company should cease to operate the Luscar Branch, the question whether under such altered circumstances the railway ceases to be within s. 92, head 10 (a), may have to be determined, but that question does not now arise.

Finally, I wish to refer to a number of observations in the Ottawa Valley Power Co. case, supra. The case itself is at a considerable distance from the present one, involving statutory invalidation by Ontario of certain electric power contracts between two companies, one in Ontario and the other in Quebec. In consequence, the Courts were concerned with whether Ontario was purporting to legislate in relation to civil rights outside the Province and a majority of the Ontario Court of Appeal so held. In the course of his reasons, Masten J.A., one of the majority, with whom Middleton J.A. agreed, commented as follows on the contractual relationship between the two companies and their interwoven operations (at pp. 613-4):

… I assume without so determining that the undertaking in question falls within the provisions of Head 10(a) and that the Dominion could by appropriate legislation assume control of it and regulate or prevent its operation. But it has not done so, and on the contrary it has by Order in Council passed under and in pursuance of s. 4 of the Navigable Waters’ Protection Act, R.S.C. 1927, c. 140, approved of the site of the works and of the plans under which such works were built and placed and of the plans under which they are now maintained. Under such circumstances is it possible to say that the contracts in question, though made by corporations fully empowered and duly authorized by both the Provincial Governments which incorporated them, are void? It seems to me that even if the Dominion were held entitled to assume exclusive control of the construction and operation of these works yet the contracts in question must under existing circumstances remain valid and effective as between the parties to them. In other words, legislative authority for the construction and operation of the works is one thing and the contracts in question between two private corporations not being inherently illegal are quite another thing.

There are statements in the reasons of Fisher J.A., also one of the majority, which may be properly questioned today as they relate to the scope of federal power but, that apart, he says this (at p. 623):

The Dominion has not entered the field and therefore I cannot see how the grant of the power to contract for the transmission of power from one Province to another falls outside the provincial power or in any way impinges upon the Dominion power, which has not in fact been exercised.

In short, I see nothing in the Ottawa Valley case that lends support to the appellant’s submissions.

An unusual feature of the proceedings in this Court is the position taken by the intervening Attorney General of Canada. Counsel for the Attorney General supported the jurisdiction of the Alberta Energy Resources Board on the particular facts and by reason of the majority decision of this Court in the Kootenay and Elk case. The support was limited to the Board’s authority to permit the construction and operation of the substation and the transmission line and with a caveat if the Board’s decision imposes a requirement of interconnection. Reference was made to s. 14(2)(b) of The Hydro and Electric Energy Act which empowers the Board, with the authorization of the Lieutenant-Governor in Council, to require connection or interconnection with other existing or proposed electrical distribution systems. Under s. 14(2.1), an interconnection may be directed by the Board without the authorization of the Lieutenant‑Governor in Council “where the interconnection is not for the purpose of interprovincial or international transmission of electrical energy”.

This Court is not called upon in this appeal to consider the validity of ss. 14(2)(b) and 14(2.1) of The Hydro and Electric Energy Act. I take the decision of the Board, so far as it approves interconnection with British Columbia facilities, as being merely permissive, this being reflected in the agreed statement of facts set out above. In the result, the application is one to enable Calgary Power Ltd. to reap the benefits of interconnection when made, as it may see fit, in the interests of its customers in Alberta, but for the present the Board is being asked to approve the construction and operation of facilities which are wholly within Alberta. The prospect of a federal legislative interest when an interconnection is made with facilities in British Columbia is not enough to bring this case within s. 92(10)(a) when there is no applicable federal legislation.

I would, accordingly, dismiss the appeal with costs to the respondent Calgary Power Ltd. I would answer the constitutional question posed in this case in the affirmative, subject, of course, to the prescription of federal legislation, especially as it may relate to export of electrical power, and subject to construction of the provincial legislation as being permissive only in its reach. There will be no order as to costs with respect to the Board or any of the interveners.

Appeal dismissed with costs.

Solicitors for the appellants: McLaws & Company, Calgary.

Solicitors for the respondent Energy Resources Conservation Board: M.J. Bruni, Calgary.

Solicitors for the respondent Calgary Power Ltd.: Bennett Jones, Calgary.

Solicitor for the intervener the Attorney General of Alberta: Ross Paisley, Edmonton.

Solicitor for the intervener the Attorney General of Canada: Roger Tassé, Ottawa.

Solicitor for the intervener the Attorney General of Ontario: H. Allan Leal, Toronto.

Solicitor for the intervener the Attorney General of Quebec: Daniel Jacoby, Quebec.

Solicitor for the intervener the Attorney General of New Brunswick: G.F. Gregory, Fredericton.

Solicitor for the intervener the Attorney General of British Columbia: Richard Vogel, Victoria.

Solicitor for the intervener the Attorney General of Manitoba: Gordon F. Pilkey, Winnipeg.

Solicitor for the intervener the Attorney General of Newfoundland: G.B. Macauley, St. Johns.

[^1]: (1980), 1980 ABCA 9, 109 D.L.R. (3d) 189, [1980] 3 W.W.R. 176, (1980), 19 A.R. 616.

[^2]: 1954 CanLII 216 (SCC), [1954] S.C.R. 207.

[^3]: 1978 CanLII 163 (SCC), [1979] 1 S.C.R. 297.

[^4]: (1905), 1905 CanLII 9 (SCC), 36 S.C.R. 596.

[^5]: 1937 CanLII 99 (ON CA), [1936] 4 D.L.R. 594.

[^6]: 1972 CanLII 182 (SCC), [1974] S.C.R. 955.

[^7]: 1927 CanLII 472 (UK JCPC), [1927] A.C. 925.

[^8]: 1954 CanLII 289 (UK JCPC), [1954] A.C. 541.

[^9]: 1944 CanLII 49 (SCC), [1945] S.C.R. 16.

[^10]: [1905] A.C. 52.