Supreme Court of Canada
Motor Transport Board of Manitoba v. Purolator Courier Ltd., 1981 CanLII 208 (SCC), [1981] 2 SCR 364
The Motor Transport Board of Manitoba (Respondent) Appellant;
and
Purolator Courier Limited (Appellant) Respondent.
1980: December 9; 1981: September 28.
Present: Laskin C.J. and Martland, Dickson, Estey and Lamer JJ.
ON APPEAL FROM THE COURT OF APPEAL FOR MANITOBA
Carriage of goods—Licensing—Provincial Motor Transport Board varying intra and extra‑provincial licences—General operation considered—Whether or not Board erred or lost jurisdiction—Whether or not separate hearing necessary to consider extra-provincial licence—The Highway Traffic Act, R.S.M. 1970, c. H60, ss. 2, 3(2), 237(1), 255(1), 257.
Appellant Board, after a show cause hearing held because of complaints alleging that respondent had contravened its licenses, revoked and then substituted more restrictive inter and intraprovincial licenses. That order was struck down on appeal and remitted to the Board. The Board appealed.
Held: The appeal should be allowed.
A statutory appeal to the Court of Appeal depended on there being a question of law or jurisdiction. Even though respondent made the “philosophy” of its operation a central issue at the hearing, appellant neither exceeded nor lost its jurisdiction and did not err in law in revoking and amending the licences by directing itself to such issue though not the immediate subject of the show cause hearing. Once the contraventions were established, the Board had to decide the disciplinary action, and in the absence of a general right of appeal under The Highway Traffic Act the courts had nothing to say in the matter. While it might have been indicated in the notice that the Board was sitting in both its federal and provincial capacities, and that both intra and extra-provincial certificates were subject to revocation and amendment, the respondent was not misled.
Coughlin v. The Ontario Highway Transport Board, [1968] S.C.R. 569; B-Line Express Ltd. v. Motor Carriers Commission, [1975] 3 W.W.R. 598; National
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Freight Consultants Inc. v. Motor Transport Board, [1980] 2 S.C.R. 621, referred to.
APPEAL from a judgment of the Court of Appeal for Manitoba1 striking down an order of The Motor Transport Board of Manitoba and remitting the matter to the Board. Appeal allowed.
James E. Foran and W. Glenn McFetridge, for the appellant.
W.G. Ryall and R.B. McNicol, for the respondent.
The judgment of the Court was delivered by
DICKSON J.—Purolator Courier Limited operates as a public service vehicle carrier, providing a courier service throughout all provinces of Canada and more particularly, within, into and through the Province of Manitoba. The Motor Transport Board of Manitoba received a number of complaints that Purolator was transporting goods in contravention of its Public Service Vehicle Certificate. A “show cause” hearing was held, as a result of which Purolator’s intraprovincial and extra-provincial authorities were revoked and others, more restricted, substituted therefor. The Manitoba Court of Appeal (O’Sullivan and Huband JJ.A., Monnin J.A. dissenting) struck down the Board’s order and remitted the matter to the Board. The Board appeals, by leave of this Court.
I
Board Authorities
For some unexplained reason the certificates which Purolator received from The Motor Transport Board were not in the material placed before the Manitoba Court of Appeal. Extracts were filed and the same extracts are in the material before this Court. From these extracts it would appear that in February 1974 an Intra-Provincial Certificate was issued to Purolator by The Manitoba
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Motor Carrier Board (predecessor of The Motor Transport Board) pursuant to The Highway Traffic Act, R.S.M. 1970, c. H60, entitling Purolator to conduct a courier service for the transportation of certain named commodities from point to point in Manitoba, subject to several restrictions, one of which read “single shipment from any one consignor to any one consignee not to exceed 100 pounds and no single package in such shipment to exceed 50 pounds in weight.”
At the same time the Board, acting pursuant to the Motor Vehicle Transport Act of Canada, R.S.C. 1970, c. M-14, granted Purolator an Extra-Provincial Certificate to conduct a courier service for the transportation of the same commodities extra-provincially from various points in the Province of Manitoba to the Manitoba/Saskatchewan boundary and the Manitoba/International boundary, for furtherance as authorized by the Saskatchewan Highway Transport Board and the Interstate Commerce Commission.
In March of 1975 Purolator received from the Board, acting under the federal authority, an Extra-Provincial Certificate permitting Purolator to transport the same named commodities from points in the Province of Ontario to points in the Province of Manitoba and from points in the Province of Manitoba to the Manitoba/Ontario boundary.
Each of the Extra-Provincial Certificates contained the weight restriction provision found in the Intra-Provincial Certificate.
On October 13, 1978, the Motor Transport Board wrote to Purolator listing eleven items, alleged violations of Purolator’s “Public Service Vehicle Certificate, as issued by the Board.” Item 4 concerned the shipment of a carton of auto parts weighing 14 pounds. The Item read:
The tariff charged as per Table #1 filed rate effective January 9, 1978 should be $4.25. Bill indicates that $2.50 was collected on delivery by the driver.
—apparent violation of filed Tariff rate.
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Item 7 referred to a Highway Inspection Report issued at Headingly in Manitoba, and to several way-bills including (i) shipment of two cartons, 70 pounds each to Weyburn, Saskatchewan from Winnipeg—140 pounds to one consignee, exceeds the 100 pound restriction; (ii) shipment of three cartons, 38 pounds each to Robert Simpson, Regina, Saskatchewan, exceeds the 100 pound restriction; (iii) shipment of two cartons of drugs, 55 pounds each to North Battleford, Saskatchewan—110 pounds to one consignee, exceeds the 100 pound restriction and possible violation of certificate.
The Board set a named date and place for a show cause hearing “so that your firm may have an opportunity to be heard and answer the allegations and show why the certificate of authority should not be cancelled”. The notice concluded: “Pursuant to Section 273 of The Highway Traffic Act, the Board may, upon being satisfied with the findings at the time of the hearing revoke, alter or amend the certificate, as issued under Part VIII of the act.”
Section 273(1) of The Highway Traffic Act reads:
273(1) The transport board may, for cause, suspend, and after at least ten days’ notice to the holder of a certificate and the granting to him of an opportunity to be heard, revoke, alter, or amend a certificate issued under this Part, and the board shall give notice to the registrar of any order or ruling made under this section.
II
The Hearing
It is unfortunately necessary to refer at some length to the transcript if one is to understand and fully appreciate how the Board conducted the hearing. At first impression it might appear that the Board convened a show cause hearing with a number of specific allegations and then transformed the hearing into a general inquiry into the philosophy of the courier entities and their relationship with general common carriers. The matter
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is not that simple, as a careful reading of the lengthy transcript will disclose.
At the opening of the hearing, Mr. Ryall, counsel for Purolator, said he would be producing two witnesses at the outset. He continued:
The Chief Executive Officer for Purolator Courier Ltd., who will not deal with the specific charges, but who will put before you some of the basic concepts of the courier business and Purolator Courier’s business in particular, so that we can get their situation in front of you and in your minds.
The first witness, Mr. Lebert, testified at length. During the course of his testimony the following questions were asked and answers given. Mr. Wood is a member of the Motor Transport Board.
MR. WOOD: So that really couriers, as such, are different breed of cats than general freight operators or even bus companies.
MR. LEBERT: Yes.
MR. WOOD: You would agree with that?
MR. LEBERT: Yes, definitely.
MR. WOOD: In other words, couriers specialize in moving small time sensitive shipments from door to door.
MR. LEBERT: That is correct.
MR. WOOD: And, your’s is a time sensitive market, that’s what you do now.
MR. LEBERT: That’s what we have developed.
MR. WOOD: At a premium charge?
MR. LEBERT: Yes.
MR. WOOD: At a rate higher than the customer, the shipper would expect to pay to move ten pounds from point “A” to point “B” under the normal circumstances, or by the usual modes of transportation.
MR. LEBERT: That is correct. There maybe [sic], with all due respect, cases where large multiple shippers across Canada that tender to us anywhere from one thousand and three thousand shipments a day, who have the benefit of a multiple tariff and I don’t know the actual trucking rate up to ten pounds but ours is quite reasonable in some cases where we have large multiple shippers.
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After further discussion, Mr. Wood made this observation which proved to be a telling one having regard to the Board’s final decision:
Now, I thought at the time that, you know, all these things were spelled out that we had this courier business nailed down, but we haven’t, that is obvious, so somewhere, Mr. Chairman, I think you know, during today’s discussion, regardless of the outcome insofar [sic] as the infractions are concerned, but just a general discussion, somewhere I think it’s going to result in probably a review of the entire courier situation because the system of moving of goods is changing, has changed in the past few years, even in the last five years, you know that, that’s why you’re here, that’s why your [sic] the Chief Officer of such a large company, because it has been multiplying—
Through some twenty pages of single-spaced transcript Mr. Lebert discussed, in response to questions of his counsel and board members, the courier business in general and his company’s operations. The following exchange took place between him and Mr. Mackling, the Board Chairman:
MR. MACKLING: Then, and the philosophy of the company is that you’ll provide expedited delivery for critical replacement parts and goods that are required for immediate use, but that’s a sophisticated higher priced transportation system.
MR. LEBERT: That is correct.
MR. MACKLING: And the rates should, therefore, be greater than the run-of-the-mill rates, a bus express rate or a general freight rate?
MR. LEBERT: On the average you will find that is correct, if you checked our billing.
A good deal of time was spent, during the rest of the hearing, on the subject of rates and a comparison of those charged by Purolator with those which would be charged by one of the bus lines or a general freight carrier. It is quite apparent from reading the transcript that the attention of the board members was diverted, certainly in the earlier part of the hearing, from the specifics of the eleven charges to the generalities of courier operation and the threat it might pose to other forms of
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public service vehicle transport, particularly if lower rates were quoted by the courier company. The broadening of the inquiry was no doubt in large measure attributable to the manner in which Purolator opened its case.
The second witness was Paul Thompson, Senior District Manager in charge of Manitoba/Saskatchewan operations of Purolator. Mr. Thompson was taken by Purolator’s counsel through a discussion of the circumstances surrounding the eleven items of alleged contravention. There was a great deal of talk about the shipment of a typewriter, belonging to International Business Machines, weighing 60 pounds, from Brandon to Winnipeg at charges significantly less than the Standard Tariff of Tolls. Mr. Thompson explained that I.B.M. was a multiple shipper with Purolator across Canada and therefore was charged a preferred rate. Mr. Mackling then asked a number of questions:
MR. MACKLING: Well, do you think that is properly applying the philosophy of the operation? As the Board Members talked about with Mr. Lebert.
MR. THOMPSON: I feel that a shipper that does do multiple shipping should certainly be given credit in the way of a discount for volume shipments.
MR. MACKLING: So that a shipper like IBM can do better by using Purolator than they can by using the general freight carrier?
MR. THOMPSON: Yes.
MR. MACKLING: And that sort of service should be available to them, that’s what you’re saying? And that is a proper role for a courier?
MR. THOMPSON: Yes.
MR. MACKLING: And so a courier will go out and get more and more business, or as much small general freight as it can providing it can fit them into that category, a critical or, in the case of, now Mr. Ryall says the typewriter is an electrical finished goods, so that Purolator and other, well, Purolator will go out and try and get as many lamps and as many typewriters, as many adding machines as it can to haul to places like Brandon, back and forth. You think that’s the appropriate application of your licence?
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MR. THOMPSON: Yes.
MR. MACKLING: I see. Well, it makes Mr. Wood’s comments made earlier, all that more imperative.
MR. THOMPSON: Yes.
The Board’s concern was put even more clearly in this passage:
MR. MACKLING: But the question is, that this company and Mr. Wood lead on with it, that this company is founded on the concept of expedited service for time sensitive movements and that is going to cost more than generally the other modes of transportation because it’s a facilitated service that’s being offered, that’s a concept and Mr. Lebert says, ‘yes, that is it’. Now, when we get down to the nuts and bolts of what the business is [sic] being doing in Manitoba, then we have the Manitoba supervisor, we get an item and the item may or may not have justifiably been considered to have been a critical movement, but then I questioned the witness about the philosophy that he holds in respect to the operation of his business when I direct his attention to the facts that the rates are disparate, that it’s cheaper for IBM to use Purolator than the general freight carriers that are operating daily between Brandon and Winnipeg, and I say, ‘is it proper? Do you think that you should be going out and getting more lamps, typewriters, adding machines, for someone like IBM and transporting them at less than the general freight carrier’? “Oh, that’s in the business”, that’s the philosophy this witness indicated. No, if that is a, it is a problem to the Board and it’s a problem to you, but that’s what this witness indicated. Now, he can correct himself if he wants. Mr. Jaeger is persuing [sic] that with him.
MR. RYALL: I see, Mr. Chairman.
Midway through Mr. Thompson’s evidence, while discussing one of the deliveries and the rate charged, Mr. Ryall made the following comment:
Mr. Chairman, you can appreciate that I didn’t realize that the rates were going to be an issue, and it appears that they are, I didn’t relate the rates on that particular one. The billing copy doesn’t have Item No.—
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The question of rates came up again in this passage in the transcript:
MR. RYALL: Mr. Chairman, I am going to tender, I guess, what I have done, Mr. Chairman, is I have copies of every Bill of Lading that went on that truck that day, because I am uncertain as to the charges.
MR. MACKLING: They indicate the rates charged on the bills too.
MR. RYALL: Well these are delivery copies.
MR. MACKLING: Perhaps you could defer filing that and get the information which would include rates because it’s obvious that rates have become an interesting factor in this whole operation.
MR. SANDBERG: Mr. Chairman, we have no knowledge of what the particular bills of lading pertain to, we have no information at all.
MR. MACKLING: We just have the—
MR. SANDBERG: You have copies of all the documents.
MR. MACKLING: Did you undertake to file that then, Mr. Ryall?
MR. SANDBERG: It’s just volunteer information we referred to.
MR. RYALL: Mr. Chairman, it’s probably reasonably simply in that the Board has required us to file our rates and each one of these contains the weight.
During a discussion of one of the alleged contraventions, related to the carriage of pharmaceuticals for Ayerst, Mr. Mackling questioned Mr. Thompson concerning Purolator’s interpretation of the weight restrictions attached to the Purolator certificates:
MR. MACKLING: Well, Mr. Thompson, your authority reads, ‘single shipment from one consignor to anyone consignee’ and that’s not to exceed a hundred pounds. That’s your authority.
MR. THOMPSON: Any one shipment.
MR. MACKLING: Any one shipment, that’s right.
MR. THOMPSON: Yes.
MR. MACKLING: And then it goes on, ‘and no single package in said shipment to exceed fifty pounds’. You obviously construe that you can take up to, well a gross vehicle weight of ten thousand pounds under one shipment. Is that right?
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MR. THOMPSON: Providing no bill of lading exceeds one hundred pounds or piece on that bill of lading exceeds fifty.
MR. MACKLING: And how many bills of lading were involved on this? And what were the weights?
MR. THOMPSON: Six bills of lading.
MR. MACKLING: And what were the weights on it?
MR. THOMPSON: Fifty pounds.
MR. MACKLING: On each bill?
MR. THOMPSON: Yes sir. Two cartons, 006, there’s two cartons, fifty pounds, 005 is two cartons, fifty pounds, 007 is two cartons, fifty pounds, 008 is two cartons, fifty pounds, 009 is two cartons, fifty pounds and 010 is two cartons, fifty pounds.
The shipment totalled three hundred pounds in weight. Mr. Thompson conceded that under the company’s authorities the goods could not have been carried on one bill of lading. Apparently the Board at some juncture had altered the definition of “shipment” and introduced the phrase “bill of lading”. Mr. Ryall explained:
MR. RYALL: Well, Mr. Chairman, changing the definition of a shipment is what occurred.
MR. MACKLING: Yes.
MR. RYALL: Mr. Chairman, once again it wasn’t a legal way of doing—
MR. MACKLING: But the Bill of Lading crept in there.
MR. RYALL: It’s a slip [sic] legal manner of avoiding—
MR. MACKLING: Yes, and the bill of lading crept in there, on one bill of lading—
MR. RYALL: The bill of lading—
MR. MACKLING: We’ll have to change that.
MR. RYALL: AS a result of this Hearing, Mr. Chairman, that would be changed.
MR. MACKLING: Well, we’ll have to consider that anyway.
The transcript seems in error in reporting Mr. Ryall as saying “It’s a slip legal manner of avoiding—” I think the word “slip” should read “slick”.
Item 7 of the list of complaints dealt with shipments to Yorkton, Weyburn, Regina and North Battleford, all in the Province of Saskatchewan. Mr. Thompson explained in respect of the
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shipment of six cartons of lamps to Yorkton that thirty pounds was not the weight per carton as the Motor Carrier Board Inspectors had understood but five pounds per carton for a total weight of thirty pounds. The discussion with respect to Item 7, the allegedly overweight shipments destined for delivery in Saskatchewan, is covered in pages 81 to 90 of the transcript. The company’s bill gave rise to confusion as to whether the weights stated were the total weight of the shipment or the weight per carton. It seemed generally agreed that if there was error on the part of the Board Inspectors in assuming the latter it was an error which anyone might have made.
The hearing adjourned on November 16, 1978 after all of the evidence had been heard in respect of the 11 items of alleged contravention. The hearing resumed two and one half months later, on February 2, 1979. At the opening, Mr. Ryall made the following statement:
In November, in our previous date set for this Hearing, we appeared before you to answer (inaudible-noise on tape) on the Show Cause. At that time we didn’t come prepared to describe our entire and general operations with a view to reviewing our entire and general operations. The Summons didn’t so indicate and we didn’t believe that the form of the Hearing was such.
We do not now believe that the form of the Hearing is such as to review our entire operation and we specifically object to the Board’s jurisdiction in reviewing the entire operations, at least based on the Summons that was issued in this regard, basically the letter of October 13, 1978.
The record of the first day indicates to us clearly, through the various comments, that it is your intention to, or that it is your intention to review the general operations of the company. We say that that wasn’t what the Summons provided, however, without agreeing to the Board’s jurisdiction we have today obtained twenty witnesses for today’s Hearing to testify about the company’s operations and we would like to proceed on the basis of proceeding without agreeing to the Board’s jurisdiction, without accepting the Board’s jurisdiction, but indicating to the Board that we have the twenty witnesses who will testify before the Board as to the company’s operations.
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It is difficult to reconcile Mr. Ryall’s statement that Purolator had not, in November “come prepared to describe our entire and general operations” with the evidence he led from Mr. Lebert which manifestly and in great detail described Purolator’s entire and general operations.
Mr. Ryall returned to the subject of jurisdiction a little later:
…the Board of course has the jurisdiction to review the allegations, the eleven allegations and determine in respect to those as contained in the Summons. The point of jurisdiction that I raise is one that in that type of proceedings, the Summons proceedings on the eleven allegations, we’re understood and believe to be answering the eleven allegations, in fact, that’s what we came prepared to do, but during the course of the Hearing that wasn’t what we were doing. We did that as well as we believed that the Board was carrying on what was best be described in another form of proceeding called a review of an authority and based on the notice that was provided by the Board, what they were doing was reviewing the eleven allegations not reviewing the authority with the operations of Purolator Courier, which we submit are based on a different authority or jurisdiction of the Board, which will end up resulting in different conclusions or aspects of the Hearing.
Our suggestion to you, Mr. Chairman, is that the Board, of course, has jurisdiction to review the eleven allegations, the Board has jurisdictions to conduct a review but in fact the two elements were merged by the Board in the Hearing on November, I just forget the date, the previous Hearing, November 16th and that there was no notice provided in respect to the review of the operations but only in respect to the eleven allegations. And, so the point that I’m making about producing witnesses now, is without abergating [sic] any rights we may have in respect to what we say was a Summons on eleven allegations rather than a review of authority.
The Board responded to Mr. Ryall’s observations in this manner:
Alright [sic], pursuant to the proceedings that were commenced, the Board has jurisdiction, pursuant to Section 273, under which the proceedings were commenced to make a finding based upon the information it had before it and any testimony that the licenced [sic] carrier gives to the Board in answer to it, to make a finding and upon being satisfied with the finding revoke,
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alter or amend the certificate as issued under Part VII [sic] of the Act.
During the course of Mr. Ryall’s examination of the witnesses for the company and the questions put to the witnesses’ company, by the Board, there was a contention on the part of the carrier, that the carrier was entitled to carry goods pursuant to a particular section of their authority to the extent that the Board questioned the company in respect to that section, they arose out of a reliance by the carrier on his interpretation of that section.
Now, how can we avoid some reference to an interpretation of the section under a Show Cause Hearing, I don’t know.
To the extent that, also that there was a consideration of the rates charged, that could be considered to be more of a review of the operations of the company, but that is a matter for which the Board can deal in respect to other sections of the Act dealing with filed rates and we will not pursue that matter at this point. We are confining our interest in the operations of the company within its certificate.
On the resumed hearing, Purolator indicated it had some twenty witnesses one of whom would deal with one of the specific alleged contraventions, the others would be called to say how their respective operations would be affected by cancellation, alteration or amendment of Purolator’s certificate. During the testimony of one of the witnesses, Mr. Polowick, the following exchange took place between Mr. Ryall and the Chairman of the Board, Mr. Mackling:
MR. MACKLING: Mr. Ryall, it’s all very interesting about this movement into Winnipeg, but what has it got to do with the movement that we’re talking about? Intra points. Into Winnipeg it could be handled (inaudible) by dray, couldn’t it?
MR. RYALL: No, Mr. Chairman, the witness indicated he moves by Purolator from Regina to Winnipeg, to his place in Winnipeg.
MR. MACKLING: Yes. Well is that the movement we’re looking at today?
MR. RYALL: Mr. Chairman, my understanding is that the movement we’re looking at today is the authority of Purolator Courier—
MR. MACKLING: The entire authority.
MR. RYALL: The entire authority.
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MR. MACKLING: Okay. Intra and Extra, okay.
MR. RYALL: Unless the Board so specifies that we are not looking at the Extra authority.
MR. WOOD: You started out this morning by saying that we’d look at it all but you wouldn’t agree with it, but you’d look at it.
MR. RYALL: That you were looking at all and I’d agree with it.
MR. WOOD: You wouldn’t agree with it but you’d look at it. You have been doing it anyway with other witnesses.
MR. RYALL: Yes.
It will be observed that Mr. Ryall led evidence directed to the extra-provincial authorities of Purolator. After calling thirteen witnesses Mr. Ryall told the Board that he had six further witnesses available but he wished an adjournment to discuss, without prejudice, with the Board clarification of some sections of the authority that had occasioned problems for the Board, and for Purolator, because Purolator had been misinterpreting what had been allowed under sections of its authority.
The hearing adjourned sine die and resumed on March 12, 1979 at which time three witnesses testified to a type of movement in respect of which evidence had not been led at an earlier date.
At the conclusion of the hearing Mr. Ryall advised the Board that he wished to submit a written legal argument:
The first question that I wish to raise, is the jurisdiction of the Board to interpret its own certificate, whether the Board having a certificate can interpret its certificate. To interpret it’s own certificate as it applies to the facts.
The second example of a legal argument that I wish to bring before you, is the sterilization of a federal certificate, as Mr. Chairman, I am sure you are aware, I believe that the other Board Members are aware, that the Board sits with two hats in some Hearings. It sits as a representative under the Motor Vehicle Transport Act and it sits as a Provincial representative under the Highway Traffic Act. In this particular case, there was a certificate granted in 1974, which was effectively two certificates; an intra‑provincial certificate and an extra-
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provincial certificate, specifically the Province of Saskatchewan.
By the change or the possible change or the variation of one certificate, or the wording in one, would have the effect of sterilizing the extra-provincial certificate.
It appears clear that Mr. Ryall was of the view that both the extra-provincial and intraprovincial authorities were in issue.
III
The Board’s Decision
The decision of the Board was rendered on May 4, 1979. After some introductory observations the decision reads:
Although the rate practices of the carrier are subject to the review of this Board by other methods, item four of the list of possible carrier infractions was concerned with what might be construed as a price cutting technique employed by the carrier to erode freight available to the authorized common carriers. Accordingly, the general operational character of Purolator was reviewed by carrier’s counsel at the first sitting of the hearing.
The Executive Vice-President and Chief Operating Officer of the carrier, Wilfred Lebert, gave evidence to the hearing and generally confirmed this Board’s opinion that a courier is a carrier that specializes in the transportation of time-sensitive, small shipments embodying specialized service at a higher cost than ordinary freight transportation.
The Board made the following findings, relevant to the present appeal:
The carrier had transported goods not authorized to be carried under the supposition that they might be authorized by paragraph 12 of their operating certificate which reads:
“Critical replacement parts and materials in movement where needed for immediate use and not for storage and warehousing.”
The vagueness in the wording of paragraph 11 and other paragraphs of Purolator’s certificate of authority lends itself to misunderstanding and abuse of authority.
That the carrier has been transporting items in contravention of the weight restrictions imposed upon them.
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The clear intent of the weight restrictions was obviously to ensure that the philosophy espoused by Purolator as a carrier providing expedited service of time-sensitive small shipments was maintained. Yet Purolator had admittedly exceeded those weight restrictions.
- That Purolator had deliberately chosen to flout the principles of its philosophy of its operation, and the weight restrictions imposed by the Board, by virtue of a cute legal technicality.
Although I have some difficulty with the concept of a profit-making commercial enterprise “espousing” any “philosophy”, other than that of maximizing profits within the law, the two basic findings are patent (i) Purolator’s certificate of authority was unduly vague and (ii) Purolator had transported items in contravention of the weight restrictions spelled out in its certificate. On the latter point the Board elaborated:
Purolator’s authorities are restricted and one of the restrictions is as follows:
(a) “Single shipment from any consignor to any one consignee not to exceed 100 pounds and no single package in such shipment to exceed 50 pounds in weight.”
To avoid this restriction, Purolator admittedly issued multiple bills of lading, claiming then to be able to rely on the definition of “shipment” as found in the Board’s general rules as follows:
“Rule 12…
“Except as otherwise provided, a shipment is a consignment received from one shipper on one bill of lading at one shipping point and at one time delivered to one consignee at one local address.”
The explanation given for Purolator using the “one bill of lading” technique of avoiding its restriction was that on a previous filing of rates for Board approval a number of rules of carriage were included by Purolator which included a more restrictive definition of “shipment”.
“Definition of Shipment…
“A lot of freight received from one shipper at one point at one time from one consignee at one destination.”
The underlying policy concern of the Board was expressed in these terms:
It was clearly never the intent of this Board to licence [sic] a carrier which would by the vagueness or weakness of the wording of its operating authority be enabled
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to encroach on the transportation of freight that is relied upon by general freight carriers in order to sustain service to the public.
The Board then made the express finding that Purolator had exceeded its authority and that disciplinary action was justified but not to the extent of complete revocation of Purolator’s operating authorities, having regard to the valuable service being provided by Purolator in some areas. The decision concludes:
Accordingly, the Board finds that substantial alteration of Purolator’s authorities are necessary in order to remove vagueness in their interpretation and to ensure that the true operating characteristics of Purolator as a carrier operating a specialized service for transportation of time-sensitive small shipments is maintained.
Purolator’s existing authorities were revoked and others substituted therefor. The new authorities were two in number. The first, entitled “intra-provincial”, authorized Purolator to conduct a courier service for the transportation of a selected list of commodities, more precisely defined than in the earlier authorities.
Intraprovincially: From point to point in the Province of Manitoba.
Extra-provincially: From various points in the Province of Manitoba to:
the Manitoba/Saskatchewan boundary and;
the Manitoba/International border for furtherance as authorized by the Saskatchewan Highway Transport Board and the Interstate Commerce Commission.
The second authority entitled “extra-provincial” authorized the transportation of a somewhat longer list of commodities:
From points in the Province of Ontario to points in the Province of Manitoba and from points in the Province of Manitoba to the Manitoba/Ontario boundary for furtherance as authorized.
IV
The Appeal
Purolator appealed. Section 257 of The Highway Traffic Act provides that an appeal lies to the
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Court of Appeal from any final order or decision of the transport board upon any question involving the jurisdiction of the board or upon any point of law. A majority of the Court of Appeal allowed the appeal on two grounds and the question before us is whether the Court was correct in giving effect to these two grounds or either of them. Ground (a) reads:
That the Respondent exceeded its jurisdiction or alternatively lost its jurisdiction and erred in law in revoking and amending the Certificates of Authority of the Appellant in that the Respondent directed itself throughout the hearing to an extraneous issue which was not the subject of the Show Cause Hearing convened by the Respondent in this matter;
The so-called “extraneous issue” and the position of the Court of Appeal majority in respect thereof can be identified in the following passage from the judgment of O’Sullivan J.A., speaking for the majority:
The Board took severe action against Purolator because, in the words of Chairman Mackling, “Purolator had deliberately chosen to flout the principles of its philosophy of its operations and the weight restrictions imposed by the Board by virtue of a cute legal technicality.” I think that is the key reason why the Board amended Purolator’s authority. The essential issue before us in this appeal, in my opinion, is whether the Board was acting according to law in making such a finding on a show cause hearing when the alleged violation of philosophy had not been made a ground of specific complaint against the carrier.
In the paragraph immediately preceding O’Sullivan J.A. said:
In the case which has now come before us, the Board commenced proceedings under section 273, giving notice of some 11 alleged violations of the authority under which Purolator was operating. Extensive evidence was presented at hearings conducted before the Board with respect to these 11 alleged violations. Some of the violations were admitted by Purolator, but I think it was common ground that the vagueness in the wording of the certificate lent itself to misunderstanding. Purolator submitted that the violations were individual abuses of
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the authority and were not flagrant violations. I have carefully perused the reasons for the decision given by Mr. Mackling in this case and I have read over the evidence. I am satisfied that in themselves the 11 violations would not warrant the drastic action taken by the Board in amending and restricting Purolator’s authority. [Emphasis added]
I have grave doubt whether ground (a) can be said to raise any question involving the jurisdiction of the Board or any question of law. There can be no doubt that the Board had jurisdiction to enter upon the inquiry. If jurisdiction was lost, at what point was it lost and why? Despite the Board Chairman’s frequent, and perhaps unfortunate, reference to the “philosophy” of Purolator it seems to me that in essence the Board said this: “The raison d’être of a courier service is rapid delivery of time-sensitive small shipments. Purolator has admittedly been transporting items in contravention of the weight restrictions in its authorities, in part due to an alleged misinterpretation of the authorities. Hence the need to clarify.” The Board found that Purolator had been guilty of a number of the eleven contraventions charged against it. In consequence, the Board could have revoked Purolator’s certificates. It chose the lesser disciplinary action of amendment. With respect, the Court of Appeal erred in concluding that “in themselves the eleven violations would not warrant the drastic action taken by the Board in amending and restricting Purolator’s authority”. The severity of the disciplinary action, contraventions having been established, was a matter of decision for the Board and in the absence of a general right of appeal, which one does not find in The Highway Traffic Act, I do not think the courts have anything to say in the matter.
I agree with what was said by Monnin J.A., in dissent:
This Board is a specialized tribunal with which courts should be loathe to interfere. Within the transport industry, the questions which were raised are important but it is better for all that these questions be answered by those persons who have special knowledge of that
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field of operation. Judges are hardly qualified for this type of decision.
Provincial transport boards do not have an easy task. They are, at one and the same time, the body which issues transport licenses, the policemen and prosecutor who enforces observance of the terms of the certificates issued and finally, the judge who may, for cause, revoke, amend or alter the certificates it has issued. Such is the intention of the legislature. Section 255(1) of The Highway Traffic Act of Manitoba gives the transport board “a general supervision over motor carriers and operators of public service vehicles and commercial trucks in their relations to the public, the railways and to one another”. The Board may, in matters within the Board’s jurisdiction, require every motor carrier to comply with the laws of the province and regulations made under the Act. It may require motor carriers to furnish proper service. It may specify routes, classify public service vehicles, fix tolls, fares and charges, regulate and supervise operating schedules, hear and adjust complaints against motor carriers, direct and supervise the kind of equipment and maintenance, require the establishment and maintenance of depots. This is but a partial resume of a long list of powers which concludes with s. 255(1)(n):
generally, have and exercise like powers, duties, authority, and jurisdiction over motor carriers and their motor vehicles, in respect of highway transportation as are vested in the board under The Public Utilities Board Act over public utilities and their owners, including the imposition of penalties for the violation of orders made thereunder.
Finally, as we have seen, s. 273(1) gives the Board the right, for cause, to revoke, alter or amend a certificate. In the present case the Board found cause and that finding was upheld by all members of the Manitoba Court of Appeal. The Board therefore had jurisdiction to amend. It seems to me to miss the point entirely to say that the amendment resulted from the failure of
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Purolator to live up to its own self-defined “philosophy”.
I agree with Monnin J.A. that:
Counsel for Purolator chose to bring out the history and philosophy of Purolator from its inception in Ontario a decade ago and its progress in the various provinces of Canada over the same period of time. This he did by calling the chief operating officer from Toronto and the senior district manager in Manitoba. These two gentlemen were on the stand all of Thursday, November 16 1978 and the transcript contains 105 pages. The method of operation of Purolator was put on the record. As a result, questions were asked by the members of the Board. There is no doubt that one of these members, Mr. Wood, was critical of the mode of operation and he indicated that in 1974 “the board thought that it had this courier business nailed down but we have not, that is obvious”. The questions and answers on pages 14 to 17 of the November 16 1978 hearing clearly show stiff questioning and a concern as to whether this type of business was under proper control. Let us not forget that control of carriers is within the jurisdiction of the Board.
I do not see how the Board can be said to have lost jurisdiction when Purolator chose to make the basic concepts of the courier business, i.e. the “philosophy” of its operation, a central issue at the show cause hearing. The evidence with respect thereto and Purolator’s shortfall therefrom was germane and relevant to the entire matter before the Board. Purolator is hardly in a position to complain when it placed in issue the development of the courier business in general and its own business in particular. Purolator knew on the first day from the Board’s questions, that the manner in which it conducted its business would be a factor in the Board’s determination.
I agree further with Monnin J.A. that:
The Board was within its right in checking and ascertaining if Purolator was sticking to its authority. Once it found that there were serious deviations from this small
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shipment of small parcels and,—I repeat, that there were deviations mainly of a bicycle, 2 automobile windshields, 300 lbs. of lamps, shoe polish in large quantity—the Board said hold it, we must tighten up this operation so that a repetition of such course of conduct will not happen. After 3 days of hearing, the Board amended the operators’ certificates to conform with the Board’s wishes and policies taking also into consideration its overall power to govern and control movement of goods over roads in Manitoba.
I do not see how the Board can properly be faulted, or what it could or should have done, other than it did, upon finding cause for amendment. With respect, I think the Manitoba Court of Appeal erred in giving effect to the first ground of appeal.
The other ground of appeal which the Manitoba Court of Appeal held to be well founded reads:
That the Respondent exceeded its jurisdiction and committed an error in law which is apparent on the face of its record in this cause in that the Respondent revoked and amended both the Intra-provincial Certificate of Authority and the Extra-provincial Certificates of Authority of the Appellant when the Respondent was:
i) sitting as a Provincial Transport Board with no power or authority to sit under the Motor Vehicle Transport Act of Canada and had given no notice or indication that it was sitting under The Motor Vehicle Transport Act, R.S.C.
ii) there existed no charges or insufficient charges and no evidence whatsoever in respect to movements extra-provincially in respect to the Extra-provincial Certificate of Authority of the Appellant and thereby the Board lacked jurisdiction to revoke and amend the Extra-provincial Certificate of Authority.
Although the notice of the show cause hearing undoubtedly left something to be desired in terms of precision it will be noted that s. 273(1) of The Highway Traffic Act is imprecise. It speaks of “ten days’ notice” and “an opportunity to be heard”, nothing more.
It is apparent from the notice actually sent to Purolator that several of the alleged contraven-
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tions related to interprovincial movement. Counsel for Purolator called witnesses who testified to such movement. The hearing extended over a number of months. On the resumption in February, it seemed to be common ground that the movement being looked at was the entire authority of Purolator, intra and extra. In the circumstances I must, with respect, disagree with the views expressed in the following passage from the judgment of O’Sullivan J.A.:
The proceedings complained of were conducted by the Board under the Manitoba statute; they consistently referred to one certificate and I think there can be no doubt that what was meant was the intra-provincial certificate. The inquiry which preceded the order appealed was directed formally to violations of the intra-provincial certificate. I think the Board, sitting under the Manitoba statute, had no jurisdiction to affect the extra‑provincial certificates and accordingly I would direct that they be restored.
In considering the Board’s action in respect of the extra-provincial running rights of Purolator, a number of facts seem to me of importance:
- Intraprovincial and extra-provincial rights are both referred to in two of the original certificates. From the exhibits to the affidavit of Mr. Lebert it would appear that at the opening of the show cause hearing Purolator held the following authorities:
| Exhibit | Entitled | Description at end of document |
|---|---|---|
| “A” | Intra-Provincial | intra-provincially: from point to point in the Province of Manitoba |
| “B” | Intra-Provincial | intra-provincially: from point to point in the Province of Manitoba. extra-provincially: from various points in the Province of Manitoba to: 1) the Manitoba/ Saskatchewan boundary and; 2) the Manitoba/International border, for furtherance as authorized by the Saskatchewan Highway Transport Board and the Interstate Commerce Commission. |
| “C” | Intra-Provincial | As in Exhibit “B” |
| “D” | Extra-Provincial | From points in the Province of Ontario to points in the Province of Manitoba and from points in the Province of Manitoba to the Manitoba/ Ontario boundary for furtherance as authorized. |
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Exhibits “B” and “C” refer to both intraprovincial and extra-provincial rights.
- The alterations made do not seem unreasonable in light of the evidence at the hearing. From Mr. Lebert’s affidavit it appears that the following alterations were made to the Certificates of Authority to the Manitoba/Saskatchewan boundary and to the Manitoba/United States boundary:.
a) “3. Lithographed and/or printed cheques, printed matter, stationery and stationery supplies, deposit slips and business forms”
was changed to:
“3. Lithographed or printed cheques, deposit slips and business forms.
- Printed matter, stationery and stationery supplies where required for immediate use.”
b) “4. Exposed and processed films and prints, and film of all kinds, and related supplies/materials, for and on behalf of manufacturer’s distributors, suppliers and processors.”
was changed to:
“5. Film, unexposed and processed and prints.”
c) “7. Electronic and electrical parts and materials and finished goods.”
was changed to:
“8. Electronic parts and components where required for immediate emergency use.”
d) “9. Biopsy tissue, specimens, laboratory, medical, veterinarian, dental, hospital samples, and related documents.
“10. Blood, blood derivatives, blood products and empty containers”.
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was changed to:
“10. Biopsy tissue, specimens, blood, blood derivatives, blood products and empty blood containers.
- Laboratory, medical, veterinarian, dental and hospital samples and supplies where required for immediate use.”
e) “11. Critical replacement parts and materials in movement where needed for immediate use and not for storage or warehousing.”
was changed to:
“12. Machinery and equipment parts where required for immediate use.”
Mr. Lebert’s affidavit states that the following alterations and changes were made in the Certificate of Authority to the Manitoba/Ontario boundary:
a) “3. Lithographed and/or printed cheques, printed matter, stationery and stationery supplies, deposit slips and business forms.”
was changed to:
“3. Lithographed or printed cheques, deposit slips and business forms.
- Printed matter, stationery and stationery supplies where required for immediate use.”
b) “4. Exposed and processed films, prints, complimentary replacement films and related supplies.”
was changed to:
“5. Film, unexposed, exposed and processed and prints.”
c) “6. Engineering tracings, prints specifications, calculations, designs, electronic parts and components, engineering samples and related documents.”
was changed to:
“7. Engineering tracings, prints specifications, calculations, designs, engineering samples and related documents.
- Electronic parts and components where required for immediate emergency use.”
d) “7. Laboratory, medical, veterinarian, dental, hospital samples and supplies and related documents.”
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was changed to:
“9. Laboratory, medical, veterinarian, dental and hospital samples and supplies and related documents where required for immediate use.”
e) “9. Critical replacement parts and materials in movement where needed for immediate use and not for storage or warehousing.”
was changed to:
“11. Machinery and equipment parts where required for immediate emergency use.”
- As Mr. Justice Monnin states, the delegation of federal jurisdiction to provincial boards creates a complex and unwieldy situation. The provincial board when it sits has both provincial and federal jurisdiction. The federal act gives little guidance. It consists of only six sections. Section 1 gives the short title, the Motor Vehicle Transport Act. Section 2 is a definition section. Section 3(2) is of particular importance. It reads:
3.…
(2) The provincial transport board in each province may in its discretion issue a licence to a person to operate an extra-provincial undertaking into or through the province upon the like terms and conditions and in the like manner as if the extra-provincial undertaking operated in the province were a local undertaking.
“provincial transport board” means a board, commission or other body or person having under the law of a province authority to control or regulate the operation of a local undertaking.
“local undertaking” means a work or undertaking for the transport of passengers or goods by motor vehicle, not being an extra-provincial undertaking.
Sections 4, 5 and 6 deal respectively with tariffs and tolls, exemption and penalties.
The federal act is silent on the matter of hearings, and equally silent in the matter of amendment, alteration or revocation of certificates once issued. Again I agree with Mr. Justice Monnin:
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He who can grant can also amend or revoke. I see no reason to believe that such principle does not apply because the text is silent on the matter of alteration or revocation.
I must assume that this federal legislation which was purely a delegation of federal powers to the various provincial transport boards, expects these boards to operate in their usual manner and no more. If such were not the case, it would lead to ridiculous situations and I am not prepared to find that Parliament of necessity desired ridiculous situations.
I therefore do not think that fairness requires that a further hearing be called to deal only with the extra-provincial certificate. A further hearing would simply call for a repetition of the same evidence.
I refer to Coughlin v. The Ontario Highway Transport Board, [1968] S.C.R. 569 where Cartwright J., as he then was, stated at p. 575:
Parliament has seen fit to enact that in the exercise of those powers the Board shall proceed in the same manner as that prescribed from time to time by the Legislature for its dealings with intra-provincial carriage.
I refer also to the comments of Verchere J. in B-Line Express Ltd. v. Motor Carriers Commission, [1975] 3 W.W.R. 598, at p. 601, quoted with approval by my brother Estey in National Freight Consultants Inc. v. Motor Transport Board, [1980] 2 S.C.R. 621, at p. 640:
Finally, as Mr. Mullins pointed out, it seems clear that the words ‘upon the like terms and conditions and in the like manner as if the extra-provincial undertaking operated in the province were a local undertaking’ (the Motor Vehicle Transport Act, s. 3(2)) must import the provisions of s. 11 of The Motor Carrier Act, where power to amend, suspend, and cancel a licence is expressly given to the Commission.
I have concluded on this point that while it might have been preferable to have indicated in the notice that the Board was sitting in both its federal and provincial capacities and that both extra-provincial and intraprovincial certificates were subject to revocation or amendment, I do not think, for the reasons I have indicated, that
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Purolator was in any way misled. Purolator knew from the beginning that three of the alleged contraventions concerned articles intended for delivery in Saskatchewan. At all events, any doubt would have been resolved at the resumed hearing in February when the very point was discussed by Mr. Ryall and the Board Chairman, and resolved.
I would allow the appeal, set aside the judgment of the Manitoba Court of Appeal and dismiss the appeal of Purolator Courier Limited from the decision of the Motor Transport Board of Manitoba.
The judgment of Mr. Justice O’Sullivan is silent as to costs. Mr. Justice Monnin would not have assessed costs for or against anyone, but he would have allowed a fee of $300 against the Board in favour of Mr. Ryall for a well-prepared factum and appeal book. I would allow costs to the Board in this Court and I would dispose of the matter of costs in the Court of Appeal of Manitoba in the manner proposed by Mr. Justice Monnin.
Appeal allowed with costs.
Solicitors for the appellant: Aikins, MacAulay & Thorvaldson, Winnipeg.
Solicitors for the respondent: Fillmore & Riley, Winnipeg.