Paul Daly
January 3, 2025
Any foray by the Supreme Court into an area of controversy will invariably leave some questions unanswered. That is the case with Auer as well. Building on my previous note on the decision (see here), three jump out at me.
First, the requirements of the presumption of validity are unclear. There is a plausible case for saying that the ‘presumption’ does no more than restate the basic administrative law principles that the challenger on judicial review bears the onus of demonstrating unlawfulness and that a regulation – like any decision – should be read fairly with a view to its purpose rather than stingily. Again, as long as the presumption has only a de facto quality, rather than a de jure quality, it should not create too much difficulty.
Second, the extent to which the consequences of a regulation may be considered by a reviewing court is unclear. The view taken by the Supreme Court was as follows:
The potential or actual consequences of the subordinate legislation are relevant only insofar as a reviewing court must determine whether the statutory delegate was reasonably authorized to enact subordinate legislation that would have such consequences. Whether those consequences are in themselves necessary, desirable or wise is not the appropriate inquiry (at para. 58).
In its negative sense – what a court cannot look at – this passage is clear enough: consequences are not to be taken into account where the applicant seeks to put necessity, desirability or wisdom in issue. In its positive sense – what a court can properly look at – this passage is rather less clear. There may be a useful analogy to make with federalism jurisprudence, where the legal effects of a statutory provision are relevant to determining its pith and substance for classification purposes, and it is legitimate to consider “how the law will operate and how it will affect Canadians” (Reference re Firearms Act (Can.), 2000 SCC 31, [2000] 1 SCR 783, at para. 18). But this prompts another question: how does the court get the information necessary to identify the consequences?
Third, however, the content of the record on judicial review of regulations remains unclear. The Supreme Court suggests that regulatory impact assessment documents can be considered as part of the judicial review exercise (albeit the suggestion is that they will help a court to understand why a regulation was adopted and, thus, form part of the case for upholding the regulation). Beyond this, the situation is murky.
To begin with, there is sometimes debate over what constitutes the record when a regulation is reviewed: is the court entitled only to look at the information before the regulation-maker when the regulation was made (which might simply be the text of the regulation itself and any relevant impact assessment documents) or might a wider range of information appropriate based on the grounds of judicial review? The emerging view is that a relatively broad range of information can be considered, as long as it was before the regulation-maker and relates to a ground of judicial review pleaded by the applicant (see Canadian Constitution Foundation v. Canada (Attorney General), 2022 FC 1233, at paras. 62-64; British Columbia (Lieutenant Governor in Council) v. Canada Mink Breeders Association, 2023 BCCA 310, at paras. 66-74). There is also debate about the extent to which a regulation-maker can be forced to disclose information that was before it, as this might sometimes be protected by privilege (see e.g. Mink Breeders, at para. 76), albeit that claims of privilege might backfire by causing a court to draw an adverse inference against the regulation-maker (see Portnov v. Canada (Attorney General), 2021 FCA 171, [2021] 4 FCR 501, at para. 51).
Further, there is debate about extrinsic evidence that can be placed in the record. In Sobeys West Inc. v. College of Pharmacists of British Columbia, 2016 BCCA 41, ‘big box’ pharmacies challenged a regulation which, they argued, unjustifiably favoured the interests of the members of the College over those of the public. At first instance, they succeeded, largely on the basis of extrinsic evidence considered by the reviewing court. But the Court of Appeal reversed, holding that the extrinsic evidence did not form part of the record. It was enough, for Newbury JA, that there was “some evidence – anecdotal though it may have been in whole or in part – to support [the College’s] concerns” (at para. 70). In Auer, the applicant placed extensive expert evidence before the courts to attempt to demonstrate how the Guidelines operated in an inequitable manner in a large number of cases. The Supreme Court did not need to take a position on the legitimacy of this exercise as it held that the applicant had not made out his case. But if “consequences” are a legitimate consideration in at least some instances, then presumably expert and other extrinsic evidence will be admissible to demonstrate that a regulation has effects beyond those reasonably authorized by statute.
Given that Auer jettisons Katz and thereby expands the scope of judicial review of the reasonableness of regulations, it is natural to expect that the record will expand accordingly. Ultimately, future cases will tell us about the potential availability (subject to privilege claims) of information before the regulation-maker, as well as extrinsic evidence. To my mind, however, the trend is towards more extensive, expansive records for the purposes of judicial review of regulations.
This content has been updated on January 3, 2025 at 16:24.