Smith, Constance BCUC:EX From: Sent: Thu, …...Petition for judicial review. In 1950, the...

Smith, Constance BCUC:EX

From: Mark Oulton [[email protected]]

Sent: Thu, November 9, 2006 8:41 AM

To: Gordon Fulton; [email protected]; [email protected]; [email protected]; Jim Quail; Leigha Worth; Support BCPIAC; [email protected]; [email protected]; [email protected]; Commission Secretary BCUC:EX; Cheng, Eileen BCUC:EX; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; XT:Duncan, Bruce CASe:IN; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; XT:EM McBride, Jean; McBride, Patrick J EM:IN; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]; [email protected]

Subject: Yesterday's Third Procedural Conference

Attachments: UFAWU v BC.pdf

of 2

2006-11-09

Further to the Panel's request at yesterday's procedural conference, I attach a copy of the decision of Mr. Justice Hutchison in United Fishermen and Allied Workers’ Union v. British Columbia, [1994] B.C.J. No. 2839 (S.C.) which was referred to in my Reply submissions on Agenda item 3 yesterday. The discussion of the interplay between the Utilities Commission Act and the legal regime established under the Industrial Development Act is at paras. 29 to 49. Best Regards, Mark Oulton ************************** Mark S. Oulton Hunter Litigation Chambers HUNTER / VOITH / BERARDINO / HARRIS 1040 West Georgia Street, Suite 2100 Vancouver, BC V6E 4H1 Canada ph: (604) 891-2408 fax: (604) 647-4554 Email: [email protected] CONFIDENTIAL TRANSMISSION: This message is intended only for the use of the individual or entity to which it is addressed and may contain information that is privileged, confidential or otherwise exempt from disclosure. Any other distribution, copying or disclosure is strictly prohibited. If you have

C37-7

cnsmith

IEP/LTAP

United Fishermell and Allied Worlters' Union v. British Columbia (Minisby of Energy) Page 1 of 14

Indexed as:

United Fishermen and Allied WorPtersP Union v. British Columbia

(Ministry of Energy)

Between United Fishei~?nen and Allied Worlters' Unioil and T. Buck Suzulti

Ellviorlllllelltal Foundation, Petitioners, and The Minister of Energy, Mines and Petroleuin Resources, on behalf of Her Majesty the Queen in Right of the Province of

British Coluillbia, The Attoilley General of British Coluinbia, Alcail Aluilliiliuin Liinited and Alcail Sinelters and Chemicals Ltd.,

Respondents

[I9941 B.C.J. No. 2839 Vailcouver Registry No. A94 1959

British Columbia Supreme Court Vancouver, British Columbia

Hutchison J.

Heard: October 24 - 28, 1994. J~tdginent: December 6 , 1994. Filed: December 8, 1994.

(27 PP.)

Statz~tes - Operation and efect - Efect on earlier statzttes - Corztrariety or co~zflict between statutes - What constitzltes a cor~flict, gerzeral crllcl special statutes - Crown - Regzrlatiorz of utilities - Regulntedprojects, ~vhcit constittrtes.

Petition for judicial review. In 1950, the provillcial goveiiunellt entered into an agreemellt with the corporate respondent, ALC, wl~ereby it was to s~tppol-t the realization of the dream of ALC to build a giant hydroelectric project foi- the supply of electricity to be used in its al~uninium smelting operations. In order to strengthen the hand of the executive, the Legislature passed the 1949 Illdustrial Developlnellt Act. Coilstructioil of the project was to be spread over a 50-year period. In 1987, the agreement was amended by a settleineilt agreement between the respondel~t provincial Minister, the Federal Goveliunent and ALC. Thereafter, ALC proceeded to expend some $535 million on the project. No energy project certificate was applied for under the Utilities Colnmission Act prior to commencing the constl~~ction work under the revised plans. The respolldellt Minister detelmlined that the project was not a regulated project under section 16 of the Utilities Commission Act, and that it was ulmecessasy in law for ALC to have applied for an energy project certificate. The petitioners aslted the co~trt to declare that the project was, in fact, a regulated project.

HELD: The petition was dismissed. The Ilydroelectric project was not subject to the provisiolls and operation of the Utilities Co~ll~nissioll Act. The free and uiu-estricted powers of Cabinet under

United Fisllelmen and Allied Worlters' Uilion v. British Coluillbia (Ministry of Energy) Page 2 of 14

the Illdustrial Developnleilt Act were inconsistent with the Utilities Comnission Act which required application to the Minister first and review only if it was advisable. Tlle application to the Minister for an energy project cei-tificate was an impediment to tlle broader powers given to Cabinet in section 3(1) of the foimer Act. Accordingly, sections 17 to 20 of the Utilities Co~ml~ission Act were iilcoilsistent with the unrestricted powers of Cabinet in s~~bsection 3(1) of the Ind~tstl-ial Development Act. The Legislatul-e's intentioil was that the Iildustiial Developinent Act and agreelnents inade under it were not to be s~lbject to the regulatory autllority of tlle Utilities Co~ml~ission Act. The two Acts could stand together but only iildepeildeiltly of each other.

Statutes, Regulatio~~s and Rules Cited:

Industrial Developineilt Act, R.S.B.C. 1979, c. 193, ss. 3(1), 3(2), 3(3), 4, 5, 6. J~tdicial Review Procedure Act, s. 1. British Columbia Stlpreilze Court Rules, Rule 2. Utilities Colmnissioil Act, S.B.C., c. 60, ss. 6, 16, 16(2), 17, 19, 20,21,21(2).

Couilsel for the Petitioner: Gregory J. McDade. Couilsel for the Respoildent Alcan: Brian J. Wallace, Q.C. and Ronald A. Sltolrood. Counsel for tlle Minister: George H. Copley.

(1[ 1 HUTCHISON J.:- The petitioners seek relief under the Judicial Review Procedure Act (J.R.P.A.). In simpliciter, the petitioners ask the Coui-t to declare Alcan's hydroelectric project near Kemano, lu~own as the ICemano Coinpletioil Project (IC.C.P.), to be a "regulated project" within the meaning of those words in the Utilities Colnlnissioll Act, S.B.C. c. 60, as amended (the Utilities Act). T11e Act was first introduced in 1980 and is designed to regulate, among other things, industrial projects generating electricity.

I. PRELIMINARY FACTS

2 The two respoildent parties, Alcail and the Minister of Energy, Mines and Petroleum Resources, (the Minister), on behalf of her Majesty the Queen in f ight of tlle Province of British Columbia (the Crowil), entered a settleineilt agreelnent wit11 tlle Federal Govelmneilt in 1987 in whicl~ tlle Crown's jurisdictioll was expressed to be p~trsuant to the Industrial Development Act, R.S.B.C. 1979 C. 193 (the Industrial Act). Thereafter some $535 million has been expended on K.C.P. bringing it to 40% completion. No energy certificate was applied for under the Utilities Act as none was thought to be necessary. These petitioners question that conclusion.

7 3 In October of 1990 the petitioner, United Fishelmla11 and Allied Worlters' Union, and a number of other groups bi-ougllt an application in the Federal Court Trial Division seelung a ilulnber of orders in respect of K.C.P. on tlle groulld that in executiilg the 1987 Settleinellt Agreelneilt the Minister of Fisheries failed to colnply wit11 the requirelneilts of the Federal Envirollrnental Assessment Review Process Guidelines Order (the "EAW Guidelines").

7 4 I11 May of 1991, Walsh J. ordered tlle 1987 Settlelnent Agreement quashed and the federal govelnment was ordered to undertalce an enviroiuneiltal review in accordance wit11 the EAW Guidelines.

7 5 Beca~tse of the uncel-tainty created by the decision Alcan suspended constructioll of 1C.C.P.

United Fisl~elmen and Allied Worlters' Unioil v. British Colunlbia (Ministry of Energy) Page 3 of 14

fl 6 In May, 1992, the Federal Court of Appeal overhli-ned the trial court decision and confinned the validity of the 1987 Settlenlent Agreeineilt and held that no f~li-tl~er enviroiunental review was required ~ulder the EARP Guidelines. AII application for leave to appeal to the S~lpi-eme Court of Canada was denied on February 4, 1993.

TT 7 In January, 1993, the Provincial Goveilunent announced that it would conduct a p~lblic review of 1C.C.P. On Jamaiy 18, 1993, the Lieutenant Governor-in-Council issued an Order-in-Co~lncil pursua~lt to section 6 of the Utilities Act establishing sucl~ p~lblic review as follows:

"The British Colulnbia Utilities Commission is requested to undei-talte a public review of the Kelnano Coillpletion Project and the Tei~ns of Reference attached to this order are specified to require and einpower the Conunissio~l to inquire into the inatter of the ICemailo Coinpletioll Project in the same way as for a review of a regulated project under section 20 of the Utilities Coinn~ission Act."

7 8 Hearings entailed in the public review were colnpleted in August 1994, and final submissions were filed in Septeinber 1994; the repoi-t and recoilxneildations of the British Coluinbia Utilities Conunission are pending.

7 9 Constructioil of 1C.C.P. reinains suspeilded peildiilg the outcome of this process. It is estinlated the reinainiilg woi-lt to colnplete 1C.C.P. will cost $818 million, bringing total construction costs to $1.353 billion.

fl 10 Out of all this there is oilly one significant questio~l for the Court on this petition: was it necessaly in law for Alcail to have applied for an energy certificate under the Utilities Act?

11. BACKGROUND FACTS

T[ 11 I11 order to fillly uilderstaild the issues raised here, I will briefly review the history of the development of the al~liniilium smelting industiy in Biitish Coltunbia, first conceived and mooted piior to the Secoild World War. In simple teims, the project entailed the damning of the Nechalto River, diverting its stored water westward, by tuiulel tlxough 10 miles of the Coast Range tl.lroug11 turbines to generate electiicity before eilterillg the ICemano River and hence, to tide water. The total project, as envisaged fi-0111 the outset, iilcluded the Nechalto Reseivoir created by the ICemley Dam and a number of sinaller saddle dams, two tu~ulels fi-om Tal~tsa Lalte and a duplicate system of penstoclts leading to a powerhouse housing 16 generators at ICemano, and a twinned transmission line between Kemano and ICitiinat. The generators were to have a total installed capacity of 2,200,000 H.P. (1641 MW) and a fi1-111 capability of producing 1,600,000 H.P. (1 194 MW). The resulting power was then to be transmitted to ICitimat where Alcail planned an alumiiliuin smelter.

7 12 The coalitioil goveiluneilt of the day, inesinerized by what it perceived as a bold and ilnaginative plan, executed an agreemei~t in 1950 with Alcan whereby their dream became a reality. The Industrial Act of 1949 was q~~iclcly passed and it heralded tlle Cabinet's authority to proceed "notwithstanding ally law to the contrary". Cabinet was empowered to enter into the agreement on behalf of the people of British Columbia, whereby the project was to proceed. The coiltract conteinplated Alcan developing their scheme in stages over many years and did not require conlpletion until 1999, some 50 years after its beginnings.

7 13 As such, Alcail thus argues that the govel-mnent is and was contractually bound to allow it to

United Fishermen and Allied Workers' Union v. British Colunlbia (Ministry of Energy) Page 4 of 14

proceed uix-egulated, and that, in any event, the Illdustrial Act is ciystal clear on this issue and has not been repealed.

7 14 The loss of water that would otheiwise flow into the Fraser River, pal-titularly the significantly increased flow westward under the IC.C.P., causes these petitioners alain. They are deeply concerned with the effect this nlay have on salinon runs. That conceiil is significant and legitinlate enough to nlalte them al~propriate parties to this litigation, despite Alcan's protests of laches and standing, which arguilleilts I reject out of hand.

fl 15 The petitioners argue 1C.C.P. has beconle subject to the sulbsequent Utilities Act of 1980, and they say I should declare the respondents' renewed plans to be a "regulated project", pursuant to s. 16 of the Act, t11~1s requiriilg Alcan to seek an energy project certificate. Both tlle Crown and Alcan say K.C.P. is not a "regulated project". The Minister has said so.

7 16 The petitioners go on to argue that the Minister's declaratioil to that effect is an exercise of a "statutoiy power of decision" and thus one which can be challei~ged under the J.R.P.A. They cite s. 1 of the Act defining those words.

fl 17 Counsel for the Crow11 says that no such power can be found in the J.R.P.A. but say the issue is justiciable and that I should address it, but only after refusing to do so under the J.R.P.A. Counsel for the Crown urges rile to follow illy brotl~er Lysylc J. in Transpacific TOLKS Limited and Robinson v. Director of Investigatioil and Research et a1 (1985) 68 B.C.L.R. 32, and nlalte the requested declaration under R~lle 2 of the Sulpreme Court Rules.

7 18 Section 1 of the J.R.P.A. defines "statutory power" as a power or right conferred by an enactnlent:

(b) to exercise a statutoiy power of decision.

7 19 The section f~li-ther defines "statutory power of decision" as:

"a power or right confell-ed by an eilactinent to nlalte a decision deciding or presciibing:

(a) the legal rights, powers, privileges, i iml~~~i~it ies , duties or liabilities of a person; or

(b) the eligibility of a persoil to receive, or to continue to receive, a benefit or licence, whether or not he is legally entitled to it."

7 20 The Minister, i11 writing tlu-ough her legal advisors, notified these petitioners she had coilcluded that K.C.P. was not a "regulated project". That, in illy view, is a statutory power of decision within the lneaniilg of the J.R.P.A. and I need not follow the course suggested by Crow11 counsel.

7 21 Was the Minister's decision right in law? T11e issue in pai-t conles down to an interpretation of s. 16 of the Utilities Act which reads in part as follows:

United Fishermen and Allied Workers' Union v. Britisl~ Colulnbia (Ministry of Energy) Page 5 of 14

. . . "regulated project" nleans

(e) a llydroelectlic power plant that has a capacity of 20 MW or nlore of electricity. (1C.C.P. will add 500 MW of power)

(g) a11 addition by wllich

(i) 20 MW of electric capacity ... will be added to a hydroelectric ... power plant.

but does not include (emphasis added)

Cj) a project in respect of which, before this Act conles into force, site preparation or the fabrication, construction, installation or supply of buildings, equipment, lnachinery or otller facilities llas begun (the "grandfathering" clause);

7 22 A significant question is wlletl~er K.C.P. is a project for which it can be said site preparation or s ~ ~ p p l y of other facilities had begun prior to the 1980 ellactlnent of the Utilities Act. The petitioners tale the position that no work can be said to have occurred on 1C.C.P. until the entry of Alcan into the settlenlent agreenlent of 1987. Alcan's a~~angements wit11 both t l~e federal and provincial govenlments scaled down the size of the original plans covered by their 1950 contract. T11e comnpany executed an anlending agreenlent to the 1950 agreelnent pursuant to the Industrial Act in 1987. How can you have worlc occul-ring on a project prior to 1980, the petitioners ask, when the project was not decided upon nor finally agreed to until 1987?

7 23 The 1950 agreelnent envisaged danls and diversion of the Nallilca River, a tributary of the Morice and Bulkley rivers, thus affecting the Slteena drainage system.

7 24 The federal government, through the Department of Fisheries and Oceans, llad reservations about such a diversion, and that part of the plan was scrapped in the 1987 settlement of a law suit colnnlenced by the federal govellullellt in this Court against 1C.C.P. alleging fishely degradation under their jurisdiction.

7 25 It is true that a sigllificant amount of worlc to be incolyorated into K.C.P. was completed during the original project and expansion thereafter until the settlelnent of 1987. Alcan suggests such work was designed to be ready for and accelerate the next addition, namely K.C.P. The work on 1C.C.P. prior to 1987 was perceived to be part of the "project in respect of whiclz ... preparation ... has begun" under the grandfather cla~lse of s. 16 Cj) of the Utilities Act.

7 26 As has been seen, the legislation specifically contemplates "an addition" to a project to be a "regulated project". As well, a hearing for an energy project certificate, among otl~er tl~i~lgs, requires "project justification." That surely means the Legislature felt that additions of significance (i.e. additions contemplating 20 MW or nlore of power generation), should be looked at in light of current scientific and tecl~~ological developments. No one suggests that K.C.P. will not want to take advantage of all tecl~~ological advances lnade since 1950, but Alcall does not now want to have to justify these advances as a "regulated project" IIILIS~. They say logically they have done that at the

United Fishermen and Allied Worlcers' Ullioll v. British Colulnbia (Ministry of Energy) Page 6 of 14

hearillgs already held and argue K.C.P. is exempted, in ally event, from being a "regulated project" ~ulder s. 16 (j), the "grandfather clause". Alcan suggests its project is "grandfatl~ered", though its teclxlology is not.

111. THE TWO MAJOR QUESTIONS

7 27 Two major bones of colltelltioll are left for the Court to chew upon:

1. Does the Utilities Act supersede and tale priority over the Industrial Act?

2. Is K.C.P. a "gandfathered" project ullder s. 16?

7 28 If the answer to questioll 1 is no, as I tllillk it is, there is no need to answer question 2. While recoglliziilg my findings on the secoild issue are obiter, I llol~etheless choose to give my conclusions. Firstly, I do so because of the extellsive and persuasive arguments of counsel. Secondly, I do so because I lnay be wrong on the f ~ s t issue and my analysis could be llelpf~ll sllould the matter go ful-ther. Thus, I begin by ailalyziilg the first issue.

IV. DOES THE UTILITIES ACT SUPERSEDE THE INDUSTRIAL ACT?

7 29 In Dliedger's T11e Collstructioll of Statutes, 3rd Ed. by Ruth Sullivan, Buttenvortl~s, p. 176 under, "Presumed Coherence: Avoiding Illtel-nal Conflict", the author states the govelxiilg principle as follows:

It is presuined that the provisiolls of legislatioil are meant to work together, both logically and teleologically, as parts of a f~lnctioning whole. The parts are presulned to fit together logically to fo l~n a rational, iiltelllally coilsisteilt framework; and because of the fi-ameworlc has a pul-pose the parts are also presumed to work together dynanlically, each colltributillg solnethillg toward accomplisl~ing the intended goal.

The presuinption of coherellce is also expressed as a pres~unption against internal conflict. It is presulned that the body of legislatioil enacted by a legislat~lre does not contain col~tradictions or inconsistencies, that each provision is capable of operating witllout coinillg into conflict with ally other. As La Forest J. wrote in Friends of Oldman River Society v. Canada (Minister of Transport) [I9921 1 S.C.R. 3, at 38:

There is a presul~lptioll that the Legislature did not intend to inalce or empower the inalcillg of coiltradictory enactments.

7 3 0 I start my analysis with that adinoilitioll clearly in mind. As well, I bear in mind the work of Professor Pierre A. C6t6, "The Interpretation of Legislation in Canada" (Que: Yvon Blais, 1984) and the subsection headed "Legislative Harmony: Solutiolls to Conflicts" at p. 274. I find particularly colnpellillg l i s analysis at p. 284, as follows:

The priority granted to earlier special legislati011 over more recent general provisions can also be viewed as an application of the 11lle of effectivity. By giving

United Fishermen and Allied Worlters' Union v. British Coluinbia (Ministry of Energy) Page 7 of 14

priority to the special provisions, the two laws each produce an effect. The earlier one coiltinues to deal with the special situatioils for which it was adopted, while the more recent, general law applies in all other cases.

And further he goes on to say:

... Hence a general principle of predoininailce of special legislation that has been fiequeiltly endorsed by the courts.

7 3 1 He does, llowever, admonish the reader that the Coui-ts inay well find difficulty in deciding what is or is not "special legislation". He quotes Mi-. Justice Sidney Sinith of o~ l r Coui-t of Appeal in Re Vancouiver Incoiyoration Act [I 9461 1 D.L.R. 638 at 643 :

... tlle question of what is, and what is not, special legislation (as opposed to general legislatioil) is itself a matter of consti-~~ction of the vaiious statutes in tlle light of all tlle circ~unstailces.

7 32 C6t6 then goes on to point out that the Coui-ts have cautioned that the exercise requires carefill illvestigation of Parliailient's and the Legislature's real intention. He relies on Mr. Justice Hudsoil in R. v. Williams, [I9441 S.C.R. 226, where the followiilg quote appears:

The inaxiin generalia specialibus no11 derogant is relied oil as a i-ule wllicl~ sl~ould dispose of the question, but the lnaxinl is not a rule of law but a rule of construction and bows to tlle intention of the legislature, if such intentioil can reasonably be gathered from all of the relevant legislation.

7 33 In my opinion, the Illdustrial Act is special legislatioil witl~in the ineaniilg of the cases. I take illto account tlle preainble of the Act, which coiluneilces as follows:

Whereas the prosperity of the Province depends on the developinent of its water power sites and other natural resources, the expansion of its industry and the establislment of new centres of population within its boundaries;

And whereas it is coilsequeiltly in the best interests of the Province that the establislment of new iildustries and the expailsion of existing industries that require tlle developinent of water power sites be encornaged to the f~lllest possible extent;

And whereas the establisl~ment in preseiltly uildeveloped sectioils of the proviilce of ally pelmalent industry and in pal-ticular of ail aluminium industry, which requires for its operatioils substailtial quantities of electric power, iilvolves extensive and costly preliininaiy iilvestigations and eilgiileeriilg studies and the expenditure on the construction of hydroelectric worlts and industrial plants and facilities and very large suns of money over an extended period of years;

And whereas ail order to facilitate the establislunent or expansion in the Province of such permanent industries, it is advisable that the Lieutenant Governor in Cou~ncil be empowered to inalte agreeinents respecting the use of ilatural resources;

United Fishelme11 and Allied Worlters' Uilioil v. British Coluinbia (Ministry of Energy) Page 8 of 14

Now, therefore, Her Majesty, by and with the advice and coilsent of the Legislative Assemnbly of the Province of British Columbia, enacts as follows:

(emphasis added)

7 34 There can be 110 doubt, viewed l~istorically, that the Industrial Act was passed specifically wit11 the establislvne~lt of tlze towilsites of I<emano and Icitimat in mind as sections 5 & 6 demoastrate. Anyone who lived tllrougl~ that era would recall the e~lphoria whicl~ accoillpanied the enactnleilt and developlneilt of Alcan's plans.

7 35 Sectioil3(1) of the Illdustrial Act reads:

(1) Notwithstanding ally law to the contraiy, the Lieutena~lt Governor in Couilcil may do any of the following t11ings:-

(a) Sell or lease on sucl~ tellns and for sucl~ price or rental as he deems advisable to any persoil who proposes to establish or expand an aluminium industry in the Province any Ci-owl land or interest therein, and also on such tellns and for such price or rental as lze deeins advisable grant a licence to any suc1-1 person to store or use any ulu-ecorded water in the Province; (emphasis added)

(b) Malte such other arrangements regarding the f~1tw-e operations of such industry as he may deem to be in the best interest of the Province;

(c) Malte with such persoil such ai-rangemeats as he inay deem advisable regarding ally future talciilg by ally public a~~thority of tlle llydro-electric developineilt and worlts and facilities made and constructed by sucll person, iilcludiilg all-angements as to the lnaluler and extent of such talting, the deteilniilatioil of the compensation payable in collllectioil therewith, and the collditions govellliilg the filture supply of electric power from the developllleilt so talten;

(d) Autllorize the Minister to execute any agreement for the above puiyoses.

7 36 S~~bsections 2 and 3 provide that no finailcia1 assistailce was to be given to the developer, and that Cabinet should provide for protectioil of ally fishery that would be injuriously affected. T11ere are only thee inore sectioils to the Act, s. 4 being relevant to the issues preseiltly before the Court. Section4 reads as follows:

4. Any agreemeilt made pursuant to this Act lnay froin time to time be amended or extended if deemed advisable by the Lieutenant Goveinor ill Coullcil if the s~lbject matter of such alnelld~neilt or exteilsioi~ C O L I ~ ~ lawfully have been incorporated in the origiilal agreeineilt at the time it was made (elnphasis added).

United Fishelinell and Allied Worlters' Uilioll v. British Columbia (Ministry of Energy) Page 9 of 14

7 37 It is interestiilg to note that sectioils 5 and G were added to the 1949 statute by ail amendment in 1951 in c. 40 of the statutes of B.C. for that year. The two sectioils specifically provided for the setting ~ l p of a towasl~ip and, as suggested, t l~e Legislature llad IGtimat and Kemailo in mind.

7 38 There call be little dot& liistoi-ically that this was a special Act passed for a special purpose: the establislullent of an aluillilliuill iildustry and a sinelter at Kitiinat.

7 39 That the11 brings ine to the Utilities Act w l ~ i c l ~ is the later general Act, intended to be of geileral application. The petitioilei-s argue that there is no need for a pres~lmed conflict between the Utilities Act and the Industsial Act, and that the two Acts can be read in hannoily if I find K.C.P. is a "regulated project". Tile petitioilers see no conflict between the two Acts. As I hope to demonstrate, I coilclude the two acts caiulot stand together uilless the Industrial Act is seen as specific ill application to 1C.C.P. and the Utilities Act is viewed as geileral in application.

7 40 As Driedger (supra) says at p. 178, under "Defii~ing Conflict":

T11e coui-ts will not i-esoi-t to the coilflict avoidailce strategies at their disposal uilless there is a need to do so. Fo1- this pui-pose, coilflict is nail-owly defined. In Tabeinacle Pelmamilt Building Society v. IQ~igl~t, 118921 A.C. 298, at 302, Lord Halsbuly said that so long as the Acts under review call "staad together and both operate without either iilterfeiing with the other", there was no incoilsisteilcy or conflict. In Toronto Railway Co. v. Paget, (1909), 42 S.C.R. 488, at 499, Anglin J. said:

It is not enough to exclude the application of the general Act that it deals somewllat differently with the same s~lbject-matter. It is not "iaconsistent" uilless tlle two provisioiis caiulot stand together.

In Friends of Oldman River Society v. Canada (Minister of Trailspoi-t), [I9921 1 S.C.R. 3, at 38, La Forest J. noted the similarity between this approach and definiilg conflict in the collstitutioilal law context:

There is also some doctrinal si~nilarity to the prillciple of parai~lountcy in coilstitutioilal divisioil of powers cases where iilcoilsisteilcy has also beell defined ill teillls of contradiction - i.e., "coiiipliaace with one law iilvolves breach of the other"; see Smith v. The Queen, [I9601 S.C.R. 776, at 800.

7 41 By ss. 17 tlxough 20 of the Utilities Act, the Legislature contemplated that facilities (to coin ail all encoillpassing word) which geilerate electricity are required to apply to the Minister for either ail "energy project certificate" or an "energy operation cel-tificate" prior to consti~~ction or operation of tlae facility.

7 42 That raises the questioil how call there be one Act granting Cabinet free and unrestricted powers to allow an al~minium iildustiy project to expand (the Illdustrial Act), and standing beside it another Act (the Utilities Act), which peilnits an expansion project, but only after application to the Millister who may, if t l~ougl~t wise, restrict such expansion eitl~er before or after review?

7 43 There are broad powers given to the Lieutenant Goveixor in Council under s. lG(2) of the

United Fishei~neil and Allied Worlcers' Union v. British Col~~inbia (Ministry of Ener ... Page 10 of 14

Utilities Act, wlich reads as follows:

(2) The Lieuteilailt Govenlor in Couilcil inay designate as a regulated project ail undei-talting of ally ltind that he coilsiders to be significant in the matter of energy, ilotwithstaildii~g that the uli~dei-taking is a project refell-ed to in paragsaph (i) or 6) of the deftnition of regulated project, and an ~uldel-talting that is so designated shall be deemed for the pui-poses of tlis Act to be a regulated project.

7 44 T~ILIS, the Cabinet can declare a grandfathered project to be a "regulated project" if it chooses. Ful-tl~er, usiilg s. 21 of the Utilities Act, the Cabinet inay order that an energy project certificate applied for be ref~lsed or, alteillatively, be issued on conditions. Such an order is final and binding. Col-sespondingly s. 21(2) states whel~ Cabinet inaltes such a direction, it is final and not subject to any review or appeal under the Waste Managenlent Act or tlle Water Act. These too are broad powers.

7 45 However, all of this still requires application to the Minister first. III 1950 Cabiilet entered into an agreement with Alcan mlder the Illdustrial Act; they alne~lded the agreement in 1987 under the Illdustrial Act. Cabinet acted under the ui~estricted power given it under the Act. In lny view, to now subject Cabinet and Alcail to the provisions of the Utilities Act would create legislative and colltractual chaos.

7 46 The free and ~msestricted powers of Cabiilet uilder the Iildustiial Act are illconsistent wit11 the Utilities Act which requires application to the Minister first and review if tl~ought advisable. The application to the Minister is an iinl~ediment to the broader powers given to Cabinet in s.3(1) of the Industrial Act. T~ILIS, I find ss. 17 - 20 of the Utilities Act iilconsistellt with the ullrestricted powers of Cabinet in s. 3(1) of the Ii~dustrial Act.

7 47 One can only assulne that in passing the Utilities Act, the Legislature, fi~lly aware of the Industrial Act, did not attelnpt to repeal or ainend the latter Act. Tlle Legislature's intention was that the Illdustrial Act and agreelneilts inade uilder it were not to be subject to the regulatory authority of the Utilities Act. The two Acts call stand together but only independently from each other. As Driedger (supra) states at 19 1 :

IMPLIED EXCEPTION PREFERRED TO IMPLIED REPEAL

As a inetl~od of resolving conflict, implied exception is generally preferred to implied repeal. It is prefei-sed beca~lse ulllilce iinplied repeal, wl~ich saclifices one provision to another, implied exceptioil pennits both provisiolls to operate as Loclte, J. explained in Gi-eenshields v. The Queen [I9581 S.C.R. 2 16 at 226:

In the case of coilflict between an earlier and later statute, a repeal by implication is never to be favoured and is oizly effective where the provisions of the later enactinent are so inconsisteilt with or repugnant to those of the earlier that the two canllot stand together ... Special Acts are not repealed by general Acts unless there be soine express reference to be previous legislatioil or a necessaly illcollsisteilcy in the two Acts stailding together w l ~ i c l ~ prevents the maxiin generalia specialibus iloll derogant being applied.

United Fisheilnen and Allied Workers' Uilion v. British Coluinbia (Ministry of Ener ... Page 11 of 14

(71 48 To put it another way, if the Legislature had wished to iilterfere with the Alcan agreement of 1950 when it passed the Utilities Act in 19S0, it nlerely had to say so in clear and uilainbiguous language.

7 49 It is for these reasons that I coilclude that the 1C.C.P. is not a project subject to tlle Utilities Act, and accordingly the statutoiy power of decision attributed to the Miilister was properly exercised. That is to say, in effect, I find the Minister was right when she said that K.C.P. was not a "regulated project" beca~~se it was not subject to the Utilities Act. However, if I ain wroilg in finding tlze Utilities Act does not supersede the Illdustrial Act, it becoilles necessary to explore the next issue.

V. IS K.C.P. A GRANDFATHERED PROJECT UNDER SECTION 16 OF THE UTILITIES ACT?

7 50 Once again, the legislatioil illust be read with care in order to ascei-tain the Legislahu-e's intent in defining a "regulated project" under s. 16.

7 51 For ease of reference, I set forth again tlze relevailt definitioil of "regulated project" in tlze section:

(a) an electric trailsinissioil line of 500 l w or higller voltage or a s~lbstation wit11 wl ic l~ such a transmission line is coilllected, or both,

(b) an eizergy trailsshipment tenninal or energy storage facility, capable of storiizg an eizergy resource in a quantity that is capable of yielding by coinbustioil 3 PJ or inore of energy,

(c) an energy use project,

(d) a transmission pipeline, capable of transpoi-ting in one year natural gas, oil or solids, or a liquid or gas derived ii-om them, in a quantity that is capable of yielding by coinbustion 16 PJ or lnore of energy,

(e) a l~ydroelectric power plant that has a capacity of 20 MW or inore of electricity,

(f) a thermal electric power plant that has a capacity of 20 MW or inore of electricity,

(g) an addition by which

(i) 20 MW or more of electric capacity, or

(ii) 20 average annual MW or illore of fill11 energy capability

will be added to a hydroelectric or tl~eilnal electi-ic power plant, and

(11) ail addition to a project referred to in ally of paragraphs (a) to (d), where the addition, if consti~~cted aloae, would fall within ally of those paragrapl~s and

United Fishennell and Allied Worlters' Union v. British Columbia (Ministry of Ener ... Page 12 of 14

llotwithstalldiilg that the addition is to a project referred to in paragrap11 (i) or Ci).

but "regulated project" does not include

(i) a project that is complete or in operation before this Act comes illto force, or

Cj) a project in respect of wl~ich, before this Act conles into force, site preparation or the fabrication, construction, illstallatioll or s~lpply of buildings, equipment, macllinery or other facilities has begun;

52 The wllole section must be read in its entirety and an effort made to acl~ieve cohesion and hal~nony wllen iilterpreting the Legislature's meaning. Could K.C.P. be a regulated project that does not fall under tlle exceptions of s~~bsections (i) and Cj)?

7 53 The petitioners argue that sulbsection (g) would be meaningless if projects such as K.C.P. were excluded; and since (g) is there, it is presumed to be so illtentionally and nlust be given some meaning.

7 54 Analyzing what is involved, one could put it this way: (a) to (d) cover new energy trailsillissioil projects and energy producing projects whicl~ do not use hydro power to achieve such electrical power; (e) and (f) cover new larger electrical producing projects, both hydro electric and thei~llal; (g) clearly inealls an old project that is added to and thus becomes, in effect, a new larger project.

7 5 5 If (i) and Cj) are read to llleall an addition of? the K.C.P. variety, why have (g) at all (or (11) for that matter)?

7 56 Tunling to the meaning of (i), the words "coinplete or in operation" must be read coiljunctively, in my view, otherwise ally project that existed before the Act could add an addition and escape being a "regulated project" and (g) would be uwlecessary, in that no addition to any existing project would ever be a "regulated project". T~LIS, the "or" between "coinplete or in operation" must be read together to meall somethillg altill to being coinplete or so close to it that for all inteilts and ptli-poses, it is in operatiol-~ as a conlpleted project.

7 57 It seems to me that all of Alcan's existing facilities prior to the 1987 amending agreement were complete and in operation and, therefore, they were not subject to being regulated under the Utilities Act piior to 1987. However, such is not the case with the contelnplated work to be done on K.C.P. to bring the f~lll plan to fruition.

7 58 That biings me then to the question of whether or not K.C.P. is one "in respect of which, before this Act coilles into force, site preparation or the fabrication, construction, installation or sulpply of buildings, equipnlent, machinery or other facilities has begun", as contemnplated under (j). In my view, none of K.C.P. can be so classified. Despite the fact that K.C.P. will inalte use of and co-opt part of its coillpleted pre-1987 operation, that does not, ill my view, mean that the K.C.P. had coln~nellced site preparation or the fabrication, constr~~ction, illstallation or supply of buildings, equipment, nlachillery or other facilities prior to the 1987 anlending agreement. Clearly, K.C.P. is an addition ulnder (g) and not, in lily view, exelnpted from regulation by Cj).

United Fishei~nen and Allied Woskers' Union v. British Coluinbia (Ministry of Ener ... Page 13 of 14

(TI 59 I find that K.C.P. is not a ''gra~~dfathered" project ~ulder s. 16 of the Utilities Act.

VI CONCLUSIONS

7 60 Having said all that, the Act itself g colnplete discretion to the Minister, enabling him or her to put the whole issue to a hearillg before the Utilities Coiml~ission under s. 19 of t l ~ e Utilities Act, and indeed this was done t l~ough Cabinet uilder s. 6, wit11 hearings held and a decision expected sl~ortly. 111 that respect these petitioners seein to have veiy little they can achieve, from a practical point of view, even were they able to have the Court hold that 1C.C.P. is a "regulated project", unless they could force Cabinet to order yet another review.

7 61 I11 stumnaly I find lnyself in substantial agree~neilt with the co i~c l~~s io i~s reached by Mr. Mull-ay Rankin in his report of October 1992 to the Govellunellt of British Columbia, which resulted in 1C.C.P. being teinporarily interrupted to meet the review by the Utilities Co~mnission and the Minister's subseq~lent declaration that 1C.C.P. was not a "regulated project". In a press release of January 19, 1993, attached as Exhibit F to the affidavit of Andrew W. Cai-penter, swo111 August 18t11, 1994, the Premier alulouilced the p~lblic review and is quoted as saying:

We in~lst accept Mr. Rankin's collclusioll that the settlelnent agseeineilt is nevertl~eless legally binding. Brealting the agreement could cost B.C. taxpayers well over half a billioil dollars in coinpensation to Alcan for constnlction to date, and inay cost inany inillions inore for lost electricity sales.

(TI 62 This cautious approacl~, as a result of Ms. Railkin's advice, does not appear to have been unwaisanted.

(TI 63 I set fort11 the relief specifically prayed for in the petition wlzich sought the following orders:

A. An order in the nature of a declaratioil that the ICeinano Coinpletion Project, a l~ydsoelectric project near I<emaao, B.C. is a "regulated project" withill the meaning of s. 17-21 of the Utilities Coilunission Act, S.B.C. Ch. 60 as amended;

B. An order in the nature of a declaration that the Minister of Energy, Mines and Petsoleuln Resources has a duty to require an application p~~rsuant to s. 18 of the Utilities Commission Act, in the folln required by the Energy Project Cei-tificate Application Regulatioil (B.C. Reg. 388180) prior to any approval on behalf of the goveilullelzt of British Columbia a~lthorizing the consti-uction of an addition to the l~ydroelectric power plait lmown as the Kelnano Coinpletion Project;

C. An order in the nature of a declaration that the Minister of Energy, Mines and Petsoleurn Resources, upon tlle receipt of the said application must, with the concurrence of the Minister of Ellviroiunent Lands and Parlcs, refer the application to the Utilities Colnlnissioil for a fill1 and proper review as required by s. 19(l)(a), and s. 20 of the Utilities Coimnission Act.

D. An order in the nature of a declaration that following the receipt of the report and recoimnelldatiolls of the Utilities Commission, the Lieutenant Govelnor-

United Fishei~nen and Allied Worlters' Unioil v. British Columbia (Ministry of Ener ... Page 14 of 14

in-Council has the legal authority given under s. 21(l)(a) of the Utilities Commission Act to order, if it so wishes, "that the energy project certificate applied for be refi~sed" 01- be issued with coilditiolls as a~tl~olized by s. 21(1) (b).

E. If ail approval by the Minister of Energy, Mines and Petroleum Resources has been given for construction of the I<emano Completion Project without coinpliailce with s, 18 of the Utilities Collunissioll Act, then an order in the nahu-e of certiorari quaslling the said approval.

F. Such fill-ther and other relief as to tlGs hono~~rable co~li-t seems just.

7 64 As became appal-ent to the parties on the l~earing of this petition, once the issue of whether or not K.C.P. is a "regulated project" is resolved and the Co~li-t inaltes a declaratioil to that effect, all other relief prayed for in paragraphs B to F becomes superfluous.

7 65 As decided in the first issue, I declare 1C.C.P. is not a "regulated project" within the meaning of the Utilities Act because i t is subject to the Industrial Act instead. I dismiss the petition with costs to the respondeilts on scale 3.

HUTCHISON J

QL Update: 941219 clp/d/cn~i/jkb/DRS/DRS

Smith, Constance BCUC:EX From: Sent: Thu, …...Petition for judicial review. In 1950, the...

Documents

Transcript of Smith, Constance BCUC:EX From: Sent: Thu, …...Petition for judicial review. In 1950, the...