SUPREME COURT OF CANADA

Maple Lodge Farms v. Government of Canada, [1982] 2 S.C.R. 2

Date: 1982-07-22

Maple Lodge Farms Limited Appellant;

and

Government of Canada and the Minister of Economic Development, responsible for Industry, Trade and Commerce Respondents;

and

Canadian Chicken Marketing Agency Intervener.

File No.: 16266.

1981: November 4; 1982: July 22.

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

ON APPEAL FROM THE FEDERAL COURT OF APPEAL

Administrative law — Discretion — Import permits required by statute for goods on import control list — Guidelines issued dealing with conditions for import — Whether or not Minister had discretion to deny permits — Whether or not discretion properly exercised — Export and Import Permits Act, R.S.C. 1970, c. E-17, s. 8.

The Minister of Industry, Trade and Commerce refused to issue appellant a permit as required by s. 8 of the Export and Import Permits Act, to import a product included on an import control list, notwithstanding the ministerial guidelines dealing with the matter. Appellant questioned whether or not the Minister had any discretion to refuse to issue such a permit, and argued that, if he did, that discretion had been unlawfully exercised. The Federal Court, Trial Division, denied appellant's application seeking a writ of mandamus ordering the Minister to issue the permit sought and the Federal Court of Appeal upheld that decision.

Held: The appeal should be dismissed.

The Minister can properly and lawfully formulate general requirements for the granting of import permits, but these guidelines cannot confine the discretion accorded him under s. 8 of the Act. Here, the Minister properly exercised that discretion. Considerations relating to the amount of available dressed chicken and overall market conditions were very relevant to his

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decision to refuse to grant appellants the supplementary import permits they sought.

APPEAL from a judgment of the Federal Court of Appeal, [1981] 1 F.C. 500, 114 D.L.R. (3d) 634, 42 N.R. 312, dismissing an appeal from a judgment of Dubé J. dismissing an application for mandamus. Appeal dismissed.

D. K. Laidlaw, Q.C., and Alan J. Lenczner, for the appellant.

W. A. Hobson, Q.C., and R. P. Hynes, for the respondents.

François Lemieux, for the intervener the Canadian Chicken Marketing Agency.

The judgment of the Court was delivered by

MCINTYRE J.—This appeal arises out of the refusal of the Minister of Economic Development, responsible for Industry, Trade and Commerce of the Government of Canada, (the Minister) to issue to the appellant certain supplementary import permits under s. 8 of the Export and Import Permits Act, R.S.C. 1970, c. E-17, and Regulations passed thereunder. The permits sought would allow the appellant to import live chickens, having a weight of less than five pounds per chicken, which are in the submission of the appellant essential to the continued operation of its business. Upon the refusal of the Minister, the appellant applied to the Federal Court, Trial Division, for a writ of mandamus ordering the Minister to issue the import permits for the importation of four million pounds of live chicken. The motion was dismissed. An appeal was taken to the Federal Court of Appeal (Heald and Le Dain JJ. and MacKay D.J.) where it was dismissed for reasons written by Le Dain J., for the unanimous court. This appeal is by leave, granted November 3, 1980.

The judgment of Le Dain J. is now reported at [1981] 1 F.C. 500. It sets out the facts and statutory provisions involved in a determination of this case, and it deals with all the issues raised. I am in agreement with the disposition made of this appeal in the Federal Court of Appeal and with

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the reasons of Le Dain J., which I would adopt in their entirety. The remarks which follow are intended to supplement, and not to qualify, those reasons.

The appellant argued in this Court that the questions in issue on this appeal were whether the Minister has any discretion respecting the issue of permits under the Export and Import Permits Act and Regulations and, if such a discretion is found to exist, whether it was exercised according to law in this case when the permits applied for by the appellant were refused.

It was contended that the power to add chicken to the list of controlled products, established under s. 5 of the Export and Import Permits Act, and all powers to make regulations regarding the terms and conditions under which import permits could be issued were reserved exclusively to the Governor in Council. The Minister's function was, accordingly, limited to a purely administrative role and he was obliged to issue permits when the conditions set by the Governor in Council were met. The policy statements referred to by Le Dain J. were then no more than an aid to the Minister in deciding whether a product sought to be imported could be obtained from a domestic source. If, however, any discretion existed, it was argued that it had been wrongly exercised when the permits were refused on the basis that eviscerated chicken was available in Canada. Furthermore, it was said that the issue of the permits could not be contrary to the marketing scheme since, when no chicken was available from Canadian sources, there was no local source of supply to protect.

In my opinion, the role of the Minister may not be so restricted. The word 'may' is used in s. 8 of the Act and there is nothing in the context which would give it other than the permissive meaning ascribed to it in s. 28 of the Interpretation Act. I agree with and adopt the words of Le Dain J. in dealing with this argument, at pp. 508-10, where he said:

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Looking at these provisions as a whole, I am of the opinion that section 8 of the Act confers upon the Minister a discretion as to whether or not to issue an import permit in a particular case. Section 28 of the Interpretation Act, R.S.C. 1970, c. I-23, requires, of course, that the word "may" in section 8 be construed as permissive unless the context indicates a contrary intention. See McHugh v. Union Bank of Canada [1913] A.C. (P.C.) 299; Smith & Rhuland Limited v. The Queen, on the relation of Brice Andrews, [1953] 2 S.C.R. 95. This is not a case for application of the principle recognized in Julius v. The Right Rev. the Lord Bishop of Oxford (1879-80) 5 App. Cas. 214 and referred to in The Labour Relations Board of Saskatchewan v. The Queen on the relation of F. W. Woolworth Co. Ltd., [1956] S.C.R. 82 at page 87, that permissive words may be construed as creating a duty where they confer a power the exercise of which is necessary to effectuate a right. The Export and Import Permits Act does not create or recognize a legal right to an import permit. Chicken was placed on the Import Control List, pursuant to section 5(1)(a.1) of the Act for the purpose of restricting its importation to support action taken under the Farm Products Marketing Agencies Act, S.C. 1970-71-72, c. 65. As I have said, the effect of its inclusion in the List is, by section 14 of the Act, to prohibit its importation "except under the authority of an in accordance with an import permit issued under this Act." The common law right to import goods is to that extent abrogated. It is an implication of section 5 (1)(a.1) of the Act that the Minister is to exercise his authority to issue or refuse permits for the purpose specified therein. It cannot have been intended, in view of this declared purpose, that the power to issue permits should be a mere Ministerial duty imposed for the sole purpose of monitoring the extent to which an unlimited right of importation is in fact exercised.

The words in section 8, "in such quantity and of such quality, by such persons, from such places or persons and subject to such other terms and conditions as are described in the permit or in the regulations", do not refer to conditions defining a right or entitlement to a permit but to the terms and conditions to which an issued permit may be subject. This is clear from the terms of section 12(a) of the Act, which, in conferring the power to make regulations, speaks, inter alia, of "the terms and conditions, including those with reference to shipping or other documents, upon which permits, certificates

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or other authorizations may be issued or granted under this Act." Further, section 3 of the Import Permit Regulations, which prescribes the information to be furnished by applicants for permits, could not by implication create a right to a permit upon the simple fulfilment of this requirement. The Regulation imposes a requirement upon an applicant for a permit; it does not create, expressly or impliedly, a duty to issue a permit upon the fulfilment of this requirement. The information simply forms part of the basis on which the Minister is to exercise his discretion whether or not to issue a permit, and if so, upon what terms and conditions. The authority conferred by section 12 of the Act to make regulations respecting certain matters affecting import permits is not inconsistent with a discretionary authority in the Minister to issue or to refuse to issue a permit, although needless to say, in the exercise of his discretion he must conform to the Regulations. There is nothing in the terms of section 12, which empowers the Governor in Council to lay down certain requirements affecting permits, to suggest that t was intended to confer authority to determine the conditions upon the fulfilment of which every applicant would be entitled to a permit. The permit which the Minister may issue pursuant to section 8 is certainly subject to the terms and conditions imposed by the Regulations but that is a different thing from conditions which qualify or eliminate altogether his discretion as to whether to grant a permit at all. In conclusion, it is my opinion that section 8 confers a discretionary authority to issue import permits and does not create a duty to issue them upon the fulfilment of certain conditions.

It is clear, then, in my view, that the Minister has been accorded a discretion under s. 8 of the Act. The fact that the Minister in his policy guidelines issued in the Notice to Importers employed the words: "If Canadian product is not offered at the market price, a permit will normally be issued; . . . " does not fetter the exercise of that discretion. The discretion is given by the Statute and the formulation and adoption of general policy guidelines cannot confine it. There is nothing improper or unlawful for the Minister charged with responsibility for the administration of the general scheme provided for in the Act and Regulations to formulate and to state general requirements for the granting of import permits. It will be

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helpful to applicants for permits to know in general terms what the policy and practice of the Minister will be. To give the guidelines the effect contended for by the appellant would be to elevate ministerial directions to the level of law and fetter the Minister in the exercise of his discretion. Le Dain J. dealt with this question at some length and said, at p. 513:

The Minister may validly and properly indicate the kind of considerations by which he will be guided as a general rule in the exercise of his discretion (see British Oxygen Co. Ltd. v. Minister of Technology [1971] A.C. (H.L.) 610; Capital Cities Communications Inc. v. Canadian Radio-Television Commission, [1978] 2 S.C.R. 141, at pp. 169-171), but he cannot. fetter his discretion by treating the guidelines as binding upon him and excluding other valid or relevant reasons for the exercise of his discretion (see Re Hopedale Developments Ltd. and Town of Oakville, [1965] 1 O.R. 259).

In any case, the words employed in s. 8 do not necessarily fetter the discretion. The use of the expression "a permit will normally be issued" is by no means equivalent to the words 'a permit will necessarily be issued'. They impose no requirement for the issue of a permit.

In construing statutes such as those under consideration in this appeal, which provide for far-reaching and frequently complicated administrative schemes, the judicial approach should be to endeavour within the scope of the legislation to give effect to its provisions so that the administrative agencies created may function effectively, as the legislation intended. In my view, in dealing with legislation of this nature, the courts should, wherever possible, avoid a narrow, technical construction, and endeavour to make effective the legislative intent as applied to the administrative scheme involved. It is, as well, a clearly-established rule that the courts should not interfere with the exercise of a discretion by a statutory authority merely because the court might have exercised the discretion in a different manner had it been charged with that responsibility. Where the statutory discretion has been exercised in good faith and, where required, in accordance with the principles of natural justice, and where reliance has not

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been placed upon considerations irrelevant or extraneous to the statutory purpose, the courts should not interfere. This approach has been followed by Le Dain J. and I accept and adopt his words, at p. 514, where, though he had earlier noted that the appellant's view of the policy guidelines was not unreasonable, he said:

In the present case the Minister, acting through the Office of Special Import Policy, appears to have adopted, as the reason for refusing the supplementary import permits sought by the appellant, the considerations which are disclosed in the passages quoted above from the letters of the Agency to the appellant. These considerations relate to the quantity of eviscerated chicken available and the overall requirements of the market. Having regard to the terms of section 5(1)(a.1) of the Export and Import Permits Act and the description or definition of the product in Item 19 of the Import Control List, the proclamation establishing the Agency, and the Canadian Chicken Marketing Quota Regulations, I am unable to conclude that these considerations are clearly extraneous or irrelevant to the statutory purpose for which chicken was placed on the Import Control List and to which the exercise of the Minister's discretion must be related.

I would therefore dismiss the appeal with costs.

Appeal dismissed with costs.

Solicitors for the appellant: McCarthy & McCarthy, Toronto.

Solicitor for the respondents: R. Tassé, Ottawa.