Greenhouse Gas Pollution Pricing Act

SUPREME COURT OF CANADA

CITATION: References re APPEALS HEARD: September 22, 23,

Greenhouse Gas Pollution Pricing

2020

Act, 2021 SCC 11

JUDGMENT RENDERED: March 25,

2021

DOCKETS: 38663, 38781, 39116

BETWEEN:

Attorney General of Saskatchewan

Appellant

and

Attorney General of Canada

Respondent

- and -

Attorney General of Ontario, Attorney General of Quebec, Attorney General of

New Brunswick, Attorney General of Manitoba, Attorney General of British

Columbia, Attorney General of Alberta, Progress Alberta Communications

Limited, Canadian Labour Congress, Saskatchewan Power Corporation,

SaskEnergy Incorporated, Oceans North Conservation Society, Assembly of

First Nations, Canadian Taxpayers Federation, Canada’s Ecofiscal Commission,

Canadian Environmental Law Association, Environmental Defence Canada Inc.,

Sisters of Providence of St. Vincent de Paul, Amnesty International Canada,

National Association of Women and the Law, Friends of the Earth, International

Emissions Trading Association, David Suzuki Foundation, Athabasca

Chipewyan First Nation, Smart Prosperity Institute, Canadian Public Health

Association, Climate Justice Saskatoon, National Farmers Union, Saskatchewan

Coalition for Sustainable Development, Saskatchewan Council for International

Cooperation, Saskatchewan Environmental Society, SaskEV, Council of

Canadians: Prairie and Northwest Territories Region, Council of Canadians:

Regina Chapter, Council of Canadians: Saskatoon Chapter, New Brunswick

Anti-Shale Gas Alliance, Youth of the Earth, Centre québécois du droit de

l’environnement, Équiterre, Generation Squeeze, Public Health Association of

British Columbia, Saskatchewan Public Health Association, Canadian

Association of Physicians for the Environment, Canadian Coalition for the

Rights of the Child, Youth Climate Lab, Assembly of Manitoba Chiefs, City of

Richmond, City of Victoria, City of Nelson, District of Squamish, City of

Rossland, City of Vancouver and Thunderchild First Nation

Interveners

AND BETWEEN:

Attorney General of Ontario

Appellant

and

Attorney General of Canada

Respondent

- and -

Attorney General of Quebec, Attorney General of New Brunswick, Attorney

General of Manitoba, Attorney General of British Columbia, Attorney General

of Saskatchewan, Attorney General of Alberta, Progress Alberta

Communications Limited, Anishinabek Nation, United Chiefs and Councils of

Mnidoo Mnising, Canadian Labour Congress, Saskatchewan Power

Corporation, SaskEnergy Incorporated, Oceans North Conservation Society,

Assembly of First Nations, Canadian Taxpayers Federation, Canada’s Ecofiscal

Commission, Canadian Environmental Law Association, Environmental

Defence Canada Inc., Sisters of Providence of St. Vincent de Paul, Amnesty

International Canada, National Association of Women and the Law, Friends of

the Earth, International Emissions Trading Association, David Suzuki

Foundation, Athabasca Chipewyan First Nation, Smart Prosperity Institute,

Canadian Public Health Association, Climate Justice Saskatoon, National

Farmers Union, Saskatchewan Coalition for Sustainable Development,

Saskatchewan Council for International Cooperation, Saskatchewan

Environmental Society, SaskEV, Council of Canadians: Prairie and Northwest

Territories Region, Council of Canadians: Regina Chapter, Council of

Canadians: Saskatoon Chapter, New Brunswick Anti-Shale Gas Alliance, Youth

of the Earth, Centre québécois du droit de l’environnement, Équiterre,

Generation Squeeze, Public Health Association of British Columbia,

Saskatchewan Public Health Association, Canadian Association of Physicians for

the Environment, Canadian Coalition for the Rights of the Child, Youth Climate

Lab, Assembly of Manitoba Chiefs, City of Richmond, City of Victoria, City of

Nelson, District of Squamish, City of Rossland, City of Vancouver and

Thunderchild First Nation

Interveners

AND BETWEEN:

Attorney General of British Columbia

Appellant

and

Attorney General of Alberta

Respondent

- and -

Attorney General of Canada, Attorney General of Ontario, Attorney General of

Quebec, Attorney General of New Brunswick, Attorney General of Manitoba,

Attorney General of Saskatchewan, Progress Alberta Communications Limited,

Saskatchewan Power Corporation, SaskEnergy Incorporated, Oceans North

Conservation Society, Assembly of First Nations, Canadian Taxpayers

Federation, Canada’s Ecofiscal Commission, Canadian Environmental Law

Association, Environmental Defence Canada Inc., Sisters of Providence of St.

Vincent de Paul, Amnesty International Canada, International Emissions

Trading Association, David Suzuki Foundation, Athabasca Chipewyan First

Nation, Smart Prosperity Institute, Canadian Public Health Association, Climate

Justice Saskatoon, National Farmers Union, Saskatchewan Coalition for

Sustainable Development, Saskatchewan Council for International Cooperation,

Saskatchewan Environmental Society, SaskEV, Council of Canadians: Prairie

and Northwest Territories Region, Council of Canadians: Regina Chapter,

Council of Canadians: Saskatoon Chapter, New Brunswick Anti-Shale Gas

Alliance, Youth of the Earth, Generation Squeeze, Public Health Association of

British Columbia, Saskatchewan Public Health Association, Canadian

Association of Physicians for the Environment, Canadian Coalition for the

Rights of the Child, Youth Climate Lab and Thunderchild First Nation

Interveners

CORAM: Wagner C.J. and Abella, Moldaver, Karakatsanis, Côté, Brown, Rowe,

Martin and Kasirer JJ.

Wagner C.J. (Abella, Moldaver, Karakatsanis, Martin and

Kasirer JJ. concurring)

REASONS FOR JUDGMENT:

(paras. 1 to 221)

Côté J.

REASONS DISSENTING IN PART:

(paras. 222 to 295)

Brown J.

Rowe J.

DISSENTING REASONS:

(paras. 296 to 456)

DISSENTING REASONS:

(paras. 457 to 616)

NOTE: This document is subject to editorial revision before its reproduction in final

form in the Canada Supreme Court Reports.

RE: GREENHOUSE GAS POLLUTION PRICING ACT

IN THE MATTER OF References to the Court of Appeal for Saskatchewan, the

Court of Appeal for Ontario and the Court of Appeal of Alberta respecting the

constitutionality of the Greenhouse Gas Pollution Pricing Act, S.C. 2018, c. 12,

s. 186

Attorney General of Saskatchewan

Appellant

v.

Attorney General of Canada

Respondent

and

Attorney General of Ontario,

Attorney General of Quebec,

Attorney General of New Brunswick,

Attorney General of Manitoba,

Attorney General of British Columbia,

Attorney General of Alberta,

Progress Alberta Communications Limited,

Canadian Labour Congress,

Saskatchewan Power Corporation,

SaskEnergy Incorporated,

Oceans North Conservation Society,

Assembly of First Nations,

Canadian Taxpayers Federation,

Canada’s Ecofiscal Commission,

Canadian Environmental Law Association,

Environmental Defence Canada Inc.,

Sisters of Providence of St. Vincent de Paul,

Amnesty International Canada,

National Association of Women and the Law,

Friends of the Earth,

International Emissions Trading Association,

David Suzuki Foundation,

Athabasca Chipewyan First Nation,

Smart Prosperity Institute,

Canadian Public Health Association,

Climate Justice Saskatoon,

National Farmers Union,

Saskatchewan Coalition for Sustainable Development,

Saskatchewan Council for International Cooperation,

Saskatchewan Environmental Society,

SaskEV,

Council of Canadians: Prairie and Northwest Territories Region,

Council of Canadians: Regina Chapter,

Council of Canadians: Saskatoon Chapter,

New Brunswick Anti-Shale Gas Alliance,

Youth of the Earth,

Centre québécois du droit de l’environnement,

Équiterre,

Generation Squeeze,

Public Health Association of British Columbia,

Saskatchewan Public Health Association,

Canadian Association of Physicians for the Environment,

Canadian Coalition for the Rights of the Child,

Youth Climate Lab,

Assembly of Manitoba Chiefs,

City of Richmond,

City of Victoria,

City of Nelson,

District of Squamish,

City of Rossland,

City of Vancouver and

Thunderchild First Nation

Interveners

Appellant

- and -

Attorney General of Ontario

v.

Attorney General of Canada

Respondent

and

Attorney General of Quebec,

Attorney General of New Brunswick,

Attorney General of Manitoba,

Attorney General of British Columbia,

Attorney General of Saskatchewan,

Attorney General of Alberta,

Progress Alberta Communications Limited,

Anishinabek Nation,

United Chiefs and Councils of Mnidoo Mnising,

Canadian Labour Congress,

Saskatchewan Power Corporation,

SaskEnergy Incorporated,

Oceans North Conservation Society,

Assembly of First Nations,

Canadian Taxpayers Federation,

Canada’s Ecofiscal Commission,

Canadian Environmental Law Association,

Environmental Defence Canada Inc.,

Sisters of Providence of St. Vincent de Paul,

Amnesty International Canada,

National Association of Women and the Law,

Friends of the Earth,

International Emissions Trading Association,

David Suzuki Foundation,

Athabasca Chipewyan First Nation,

Smart Prosperity Institute,

Canadian Public Health Association,

Climate Justice Saskatoon,

National Farmers Union,

Saskatchewan Coalition for Sustainable Development,

Saskatchewan Council for International Cooperation,

Saskatchewan Environmental Society,

SaskEV,

Council of Canadians: Prairie and Northwest Territories Region,

Council of Canadians: Regina Chapter,

Council of Canadians: Saskatoon Chapter,

New Brunswick Anti-Shale Gas Alliance,

Youth of the Earth,

Centre québécois du droit de l’environnement,

Équiterre,

Generation Squeeze,

Public Health Association of British Columbia,

Saskatchewan Public Health Association,

Canadian Association of Physicians for the Environment,

Canadian Coalition for the Rights of the Child,

Youth Climate Lab,

Assembly of Manitoba Chiefs,

City of Richmond,

City of Victoria,

City of Nelson,

District of Squamish,

City of Rossland,

City of Vancouver and

Thunderchild First Nation

Interveners

Appellant

- and -

Attorney General of British Columbia

v.

Attorney General of Alberta

Respondent

and

Attorney General of Canada,

Attorney General of Ontario,

Attorney General of Quebec,

Attorney General of New Brunswick,

Attorney General of Manitoba,

Attorney General of Saskatchewan,

Progress Alberta Communications Limited,

Saskatchewan Power Corporation,

SaskEnergy Incorporated,

Oceans North Conservation Society,

Assembly of First Nations,

Canadian Taxpayers Federation,

Canada’s Ecofiscal Commission,

Canadian Environmental Law Association,

Environmental Defence Canada Inc.,

Sisters of Providence of St. Vincent de Paul,

Amnesty International Canada,

International Emissions Trading Association,

David Suzuki Foundation,

Athabasca Chipewyan First Nation,

Smart Prosperity Institute,

Canadian Public Health Association,

Climate Justice Saskatoon,

National Farmers Union,

Saskatchewan Coalition for Sustainable Development,

Saskatchewan Council for International Cooperation,

Saskatchewan Environmental Society,

SaskEV,

Council of Canadians: Prairie and Northwest Territories Region,

Council of Canadians: Regina Chapter,

Council of Canadians: Saskatoon Chapter,

New Brunswick Anti-Shale Gas Alliance,

Youth of the Earth,

Generation Squeeze,

Public Health Association of British Columbia,

Saskatchewan Public Health Association,

Canadian Association of Physicians for the Environment,

Canadian Coalition for the Rights of the Child,

Youth Climate Lab and

Thunderchild First Nation

Interveners

Indexed as: References re Greenhouse Gas Pollution Pricing Act

2021 SCC 11

File Nos.: 38663, 38781, 39116.

2020: September 22, 23; 2021: March 25.

Present: Wagner C.J. and Abella, Moldaver, Karakatsanis, Côté, Brown, Rowe, Martin

and Kasirer JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR SASKATCHEWAN

ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO

ON APPEAL FROM THE COURT OF APPEAL OF ALBERTA

Constitutional law — Division of powers — Greenhouse gas emissions —

Federal legislation setting minimum national standards of greenhouse gas pricing —

Whether greenhouse gas pricing is matter of national concern falling within

Parliament’s power to legislate in respect of peace, order and good government of

Canada — Constitution Act, 1867, s. 91 “preamble” — Greenhouse Gas Pollution

Pricing Act, S.C. 2018, c. 12, s. 186.

In 2018, Parliament enacted the Greenhouse Gas Pollution Pricing Act

(“GGPPA”). The GGPPA comprises four parts and four schedules. Part 1 establishes a

fuel charge that applies to producers, distributors and importers of various types of

carbon-based fuel. Part 2 sets out a pricing mechanism for industrial greenhouse gas

(“GHG”) emissions by large emissions-intensive industrial facilities. Part 3 authorizes

the Governor in Council to make regulations providing for the application of provincial

law concerning GHG emissions to federal works and undertakings, federal land and

Indigenous land located in that province, as well as to internal waters located in or

contiguous with the province. Part 4 requires the Minister of the Environment to

prepare an annual report on the administration of the GGPPA and have it tabled in

Parliament.

Saskatchewan, Ontario and Alberta challenged the constitutionality of the

first two parts and the four schedules of the GGPPA by references to their respective

courts of appeal, asking whether the GGPPA is unconstitutional in whole or in part. In

split decisions, the courts of appeal for Saskatchewan and Ontario held that the GGPPA

is constitutional, while the Court of Appeal of Alberta held that it is unconstitutional.

The Attorney General of British Columbia, who had intervened in the Court of Appeal

of Alberta, the Attorney General of Saskatchewan and the Attorney General of Ontario

now appeal as of right to the Court.

Held (Côté J. dissenting in part and Brown and Rowe JJ. dissenting): The

appeals by the Attorney General of Saskatchewan and the Attorney General of Ontario

should be dismissed, and the appeal by the Attorney General of British Columbia

should be allowed. The reference questions are answered in the negative.

Per Wagner C.J. and Abella, Moldaver, Karakatsanis, Martin and

Kasirer JJ.: The GGPPA is constitutional. It sets minimum national standards of GHG

price stringency to reduce GHG emissions. Parliament has jurisdiction to enact this law

as a matter of national concern under the peace, order, and good government (“POGG”)

clause of s. 91 of the Constitution Act, 1867.

Federalism is a foundational principle of the Canadian Constitution. Its

objectives are to reconcile diversity with unity, promote democratic participation by

reserving meaningful powers to the local and regional level and foster cooperation

between Parliament and the provincial legislatures for the common good. Sections 91

and 92 of the Constitution give expression to the principle of federalism and divide

legislative powers between Parliament and the provincial legislatures. Under the

division of powers, broad powers were conferred on the provinces to ensure diversity,

while at the same time reserving to the federal government powers better exercised in

relation to the country as a whole to provide for Canada’s unity. Federalism recognizes

that within their spheres of jurisdiction, provinces have autonomy to develop their

societies. Federal power cannot be used in a manner that effectively eviscerates

provincial power.

Courts, as impartial arbiters, are charged with resolving jurisdictional

disputes over the boundaries of federal and provincial powers on the basis of the

principle of federalism. Although early Canadian constitutional decisions by the

Judicial Committee of the Privy Council applied a rigid division of federal-provincial

powers as watertight compartments, the Court has favoured a flexible view of

federalism, best described as a modern cooperative federalism, that accommodates and

encourages intergovernmental cooperative efforts. However, the Court has also always

maintained that flexibility and cooperation, while important, cannot override or modify

federalism and the constitutional division of powers.

The review of legislation on federalism grounds consists of the well-

established two-stage analytical approach. At the first stage, a court must consider the

purpose and effects of the challenged statute or provision with a view to characterizing

the subject matter or “pith and substance”. A court must then classify the subject matter

with reference to federal and provincial heads of power under the Constitution in order

to determine whether it is intra vires Parliament and therefore valid.

At the first stage of the division of powers analysis, a court must consider

the purpose and effects of the challenged statute or provision in order to identify its

“pith and substance” or its main thrust or dominant or most important characteristic. In

determining the purpose of the challenged statute or provision, a court can consider

both intrinsic evidence, such as the legislation’s preamble or purpose clauses, and

extrinsic evidence, such as Hansard or minutes of parliamentary committees. In

considering the effects of the challenged legislation, a court can consider both the legal

effects, those that flow directly from the provisions of the statute itself, and the practical

effects, the side effects that flow from the application of the statute. Where a court is

asked to adjudicate the constitutionality of legislation that has been in force for only a

short time, any prediction of future practical effect is necessarily short-term, since the

court is not equipped to predict accurately the future consequential impact of

legislation. The characterization process is not technical or formalistic. A court can

look at the background and circumstances of a statute’s enactment as well as at the

words used in it.

Three points with respect to the identification of the pith and substance are

important to clarify. First, the pith and substance of a challenged statute or provision

must be described as precisely as possible. A vague or general description is unhelpful,

as it can result in the law being superficially assigned to both federal and provincial

heads of powers or may exaggerate the extent to which the law extends into the other

level of government’s sphere of jurisdiction. However, precision should not be

confused with narrowness. A court must focus on the law itself and what it is really

about. The pith and substance of a challenged statute or provision should capture the

law’s essential character in terms that are as precise as the law will allow. Second, it is

permissible in some circumstances for a court to include the legislative choice of means

in the definition of a statute’s pith and substance, as long as it does not lose sight of the

fact that the goal of the analysis is to identify the true subject matter of the challenged

statute or provision. In some cases, the choice of means may be so central to the

legislative objective that the main thrust of a statute or provision, properly understood,

is to achieve a result in a particular way, which would justify including the means in

identifying the pith and substance. Third, the characterization and classification stages

of the division of powers analysis are and must be kept distinct. The pith and substance

of a statute or a provision must be identified without regard to the heads of legislative

competence.

At the second stage of the division of power analysis, a court must classify

the matter by reference to the heads of power set out in the Constitution. Matters and

classes of subjects are distinct. Law-making powers are exercisable in relation to

matters, which in turn generally come within broader classes of subjects. Section 91

does not provide in the context of the POGG power that Parliament can make laws in

relation to classes of subjects; instead, it states that Parliament can make laws for the

peace, order, and good government of Canada in relation to “Matters”. National

concern is a well-established but rarely applied doctrine of Canadian constitutional law

derived from the introductory clause of s. 91 of the Constitution, which empowers

Parliament to make laws for the peace, order, and good government of Canada, in

relation to all matters not coming within the classes of subjects assigned exclusively to

the legislatures of the provinces. A matter that falls under the POGG power necessarily

does not come within the classes of subjects enumerated in ss. 91 and 92.

Courts must approach a finding that the federal government has

jurisdiction on the basis of the national concern doctrine with great caution. The effect

of finding that a matter is one of national concern is permanent and confers exclusive

jurisdiction over that matter on Parliament. However, the scope of the federal power is

defined by the nature of the national concern itself and only aspects with a sufficient

connection to the underlying inherent national concern will fall within the scope of the

federal power.

A closely related question concerns the applicability of the double aspect

doctrine to a matter of national concern. The double aspect doctrine recognizes that the

same fact situations can be regulated from different perspectives, one of which may

relate to a provincial power and the other to a federal power. The doctrine can apply in

cases in which the federal government has jurisdiction on the basis of the national

concern doctrine. Such an approach fosters coherence in the law, because the double

aspect doctrine can apply to every enumerated federal and provincial head of power. It

is also consistent with the modern approach to federalism, which favours flexibility and

a degree of overlapping jurisdiction. However, the fact that the double aspect doctrine

can apply does not mean that it will apply in a given case. It may apply if a fact situation

can be regulated from different federal and provincial perspectives and each level of

government has a compelling interest in enacting legal rules in relation to that situation.

It should be applied cautiously so as to avoid eroding the importance attached to

provincial autonomy.

The double aspect doctrine takes on particular significance where Canada

asserts jurisdiction over a matter that involves a minimum national standard imposed

by legislation that operates as a backstop. The recognition of a matter of national

concern such as this will inevitably result in a double aspect situation. This is in fact

the very premise of a federal scheme that imposes minimum national standards: Canada

and the provinces are both free to legislate in relation to the same fact situation but the

federal law is paramount. In such a case, even if the national concern test would

otherwise be met, a cautious approach to the double aspect doctrine should act as an

additional check. The court must be satisfied that Canada in fact has a compelling

interest in enacting legal rules over the federal aspect of the activity at issue and that

the multiplicity of aspects is real and not merely nominal.

Turning to the national concern test, there are two points worth noting

about the framework as a whole. First, the recognition of a matter of national concern

must be based on evidence. An onus rests on Canada throughout the national concern

analysis to adduce evidence in support of its assertion of jurisdiction. Second, there is

no requirement that a matter be historically new in order to be found to be one of

national concern. Many new developments may be predominantly local and provincial

in character and fall under provincial heads of power. The term “new”, as used in the

jurisprudence, refers to matters that could satisfy the national concern test and includes

both “new” matters that did not exist in 1867 and matters that are “new” in the sense

that the understanding of those subject matters has, in some way, shifted so as to bring

out their inherently national character. Thus, the critical element of the analysis is the

requirement that matters of national concern be inherently national in character, not

that they be historically new.

Finding that a matter is one of national concern involves a three-step

analysis. First, as a threshold question, Canada must establish that the matter is of

sufficient concern to the country as a whole to warrant consideration as a possible

matter of national concern. Second, the matter must have a singleness, distinctiveness

and indivisibility. Third, Canada must show that the proposed matter has a scale of

impact on provincial jurisdiction that is reconcilable with the division of powers. The

purpose of the national concern analysis is to identify matters of inherent national

concern — matters which, by their nature, transcend the provinces.

The analysis begins by asking, as a threshold question, whether the matter

is of sufficient concern to Canada as a whole to warrant consideration under the

national concern doctrine. This invites a common-sense inquiry into the national

importance of the proposed matter. This approach does not open the door to the

recognition of federal jurisdiction simply on the basis that a legislative field is important;

it operates to limit the application of the national concern doctrine and provides essential

context for the analysis that follows.

The second step of the analysis requires that a matter have a singleness,

distinctiveness and indivisibility that clearly distinguishes it from matters of provincial

concern. Two principles underpin this requirement: first, to prevent federal overreach,

jurisdiction should be found to exist only over a specific and identifiable matter that is

qualitatively different from matters of provincial concern; and second, federal

jurisdiction should be found to exist only where the evidence establishes provincial

inability to deal with the matter.

Under the first principle of the singleness, distinctiveness and indivisibility

analysis, the court should inquire into whether the matter is predominantly

extraprovincial and international in its nature or its effects, into the content of any

international agreements in relation to the matter, and into whether the matter involves

a federal legislative role that is distinct from and not duplicative of that of the provinces.

It is clearly not enough for a matter to be quantitatively different from matters of

provincial concern — the mere growth or extent of a problem across Canada is

insufficient to justify federal jurisdiction. International agreements may in some cases

indicate that a matter is qualitatively different from matters of provincial concern.

However, the existence of treaty obligations is not determinative of federal jurisdiction

as there is no freestanding federal treaty implementation power and Parliament’s

jurisdiction to implement treaties signed by the federal government depends on the

ordinary division of powers. Furthermore, to be qualitatively different from matters of

provincial concern, the matter must not be an aggregate of provincial matters. The

federal legislative role must be distinct from and not duplicative of that of the

provinces. Federal legislation will not be qualitatively distinct if it overshoots

regulation of a national aspect of the field and instead duplicates provincial regulation

or regulates issues that are primarily of local concern.

The second principle underpinning the singleness, distinctiveness, and

indivisibility analysis is that federal jurisdiction should be found to exist only where

the evidence establishes provincial inability to deal with the matter. Provincial inability

functions as a strong constraint on federal power and should be seen as a necessary but

not sufficient requirement for the purposes of the national concern doctrine. In order

for provincial inability to be established both of these factors are required: (1) the

legislation should be of a nature that the provinces jointly or severally would be

constitutionally incapable of enacting; and (2) the failure to include one or more

provinces or localities in a legislative scheme would jeopardize the successful operation

of the scheme in other parts of the country. And there is a third factor that is required

in the context of the national concern doctrine in order to establish provincial inability:

a province’s failure to deal with the matter must have grave extraprovincial

consequences. The requirement for grave extraprovincial consequences sets a high bar

for a finding of provincial inability for the purposes of the national concern doctrine

and can be satisfied by actual harm or by a serious risk of harm being sustained in the

future. It may include serious harm to human life and health or to the environment,

though it is not necessarily limited to such consequences. Mere inefficiency or

additional financial costs stemming from divided or overlapping jurisdiction is clearly

insufficient. Evaluating extraprovincial harm helps to determine whether a national law

is not merely desirable, but essential, in the sense that the problem is beyond the power

of the provinces to deal with it. This connects the provincial inability test to the overall

purpose of the national concern test, which is to identify matters of inherent national

concern that transcend the provinces.

At the third and final step of the national concern analysis, Canada must

show that the proposed matter has a scale of impact on provincial jurisdiction that is

reconcilable with the fundamental distribution of legislative power under the

Constitution. The purpose of the scale of impact analysis is to protect against

unjustified intrusions on provincial autonomy and prevent federal overreach. At this

stage of the analysis, the intrusion upon provincial autonomy that would result from

empowering Parliament to act is balanced against the extent of the impact on the

interests that would be affected if Parliament were unable to constitutionally address

the matter at a national level. Identifying a new matter of national concern will be

justified only if the latter outweighs the former.

In this case, the true subject matter of the GGPPA is establishing minimum

national standards of GHG price stringency to reduce GHG emissions. Both the short

and long titles of the GGPPA confirm that its true subject matter is not just to mitigate

climate change, but to do so through the pan-Canadian application of pricing

mechanisms to a broad set of GHG emission sources. Likewise, it is clear from reading

the preamble as a whole that the focus of the GGPPA is on national GHG pricing. In

Parliament’s eyes, the relevant mischief is the effects of the failure of some provinces

to implement GHG pricing systems or to implement sufficiently stringent pricing

systems, and the consequential failure to reduce GHG emissions across Canada. To

address this mischief, the GGPPA establishes minimum national standards of GHG

pricing that apply across Canada, setting a GHG pricing floor across the country.

Similarly, it can be seen from the events leading up to the enactment of the

GGPPA and from government policy papers that there was a focus on GHG pricing

and establishing minimum national standards of GHG price stringency for GHG

emissions — through a federally imposed national direct GHG pricing backstop —

without displacing provincial and territorial jurisdiction over the choice and design of

pricing instruments. This is supported by evidence of the legislative debates. Both

elected representatives and senior public servants consistently described the purpose of

the GGPPA in terms of imposing a Canada-wide GHG pricing system, not of regulating

GHG emissions generally.

The legal effects of the GGPPA confirm that its focus is on national GHG

pricing and confirm its essentially backstop nature. In jurisdictions where Parts 1 and

2 of the GGPPA apply, the primary legal effect is to create one GHG pricing scheme

that prices GHG emissions in a manner that is consistent with what is done in the rest

of the Canadian economy. Part 1 of the GGPPA directly prices the emissions of certain

fuel producers, distributors and importers. Part 2 directly prices the GHG emissions of

covered facilities to the extent that they exceed the applicable efficiency standards. The

GGPPA does not require those to whom it applies to perform or refrain from

performing specified GHG emitting activities. Nor does it tell industries how they are

to operate in order to reduce their GHG emissions. Instead, all it does is to require

persons to pay for engaging in specified activities that result in the emission of GHGs.

The GGPPA leaves individual consumers and businesses free to choose how they will

respond, or not, to the price signals sent by the marketplace. The legal effects of the

GGPPA are thus centrally aimed at pricing GHG emissions nationally.

Moreover, because the GGPPA operates as a backstop, the legal effects of

Parts 1 and 2 of the statute — a federally imposed GHG pricing scheme — apply only

if the Governor in Council has listed a province or territory. The GGPPA provides that

the Governor in Council may make listing decisions for Parts 1 and 2 of the statute only

for the purpose of ensuring that the pricing of greenhouse gas emissions is applied

broadly in Canada at levels that the Governor in Council considers appropriate, taking

into account, as the primary factor, the stringency of provincial pricing mechanisms for

greenhouse gas emissions. As a result, the GHG pricing mechanism described in Parts

1 and 2 of the GGPPA will not come into operation at all in a province or territory that

already has a sufficiently stringent GHG pricing system. Not only does this confirm the

backstop nature of the GGPPA — that of creating minimum national standards of GHG

pricing — but this feature gives legal effect to the federal government’s commitment

to give the provinces and territories the flexibility to design their own policies to meet

emissions reductions targets, including carbon pricing, adapted to each province and

territory’s specific circumstances, as well as to recognize carbon pricing policies

already implemented or in development by provinces and territories.

Although evidence of practical effects is not helpful in this case given the

dearth of such evidence, the evidence of practical effects to date is consistent with

providing flexibility and support for provincially designed GHG pricing schemes.

Practically speaking, the only thing not permitted by the GGPPA is for provinces and

territories not to implement a GHG pricing mechanism or one that is not sufficiently

stringent.

Applying the threshold question, Canada has adduced evidence that clearly

shows that establishing minimum national standards of GHG price stringency to reduce

GHG emissions is of sufficient concern to Canada as a whole that it warrants

consideration in accordance with the national concern doctrine. The history of efforts

to address climate change in Canada reflects the critical role of carbon pricing strategies

in policies to reduce GHG emissions. There is also a broad consensus among expert

international bodies that carbon pricing is a critical measure for the reduction of GHG

emissions. This matter is critical to our response to an existential threat to human life

in Canada and around the world. As a result, it passes the threshold test and warrants

consideration as a possible matter of national concern.

Minimum national standards of GHG price stringency, which are

implemented by means of the backstop architecture of the GGPPA, relate to a federal

role in carbon pricing that is qualitatively different from matters of provincial concern.

GHGs are a specific and precisely identifiable type of pollutant. The harmful effects of

GHGs are known, and the fuel and excess emissions charges are based on the global

warming potential of the gases. GHG emissions are also predominantly extraprovincial

and international in their character and implications. This flows from their nature as a

diffuse atmospheric pollutant and from their effect in causing global climate change.

Moreover, the regulatory mechanism of GHG pricing is also specific and limited. GHG

pricing operates in a particular way, seeking to change behaviour by internalizing the

cost of climate change impacts, incorporating them into the price of fuel and the cost

of industrial activity. It is a distinct form of regulation that does not amount to the

regulation of GHG emissions generally or encompass regulatory mechanisms that do

not involve pricing. The Governor in Council’s power to make a regulation that applies

the GGPPA’s pricing system to a province may be exercised only if it is first

determined that the province’s pricing mechanisms are insufficiently stringent. If each

province designed its own pricing system and all the provincial systems met the federal

pricing standards, the GGPPA would achieve its purpose without operating to directly

price GHG emissions anywhere in the country. The GGPPA is tightly focused on this

distinctly federal role and does not descend into the detailed regulation of all aspects of

GHG pricing.

Provincial inability is established in this case. First, the provinces, acting

alone or together, are constitutionally incapable of establishing minimum national

standards of GHG price stringency to reduce GHG emissions. While the provinces

could choose to cooperatively establish a uniform carbon pricing scheme, doing so

would not assure a sustained approach because the provinces and territories are

constitutionally incapable of establishing a binding outcome-based minimum legal

standard — a national GHG pricing floor — that applies in all provinces and territories

at all times. Second, a failure to include one province in the scheme would jeopardize

its success in the rest of Canada. The withdrawal of one province from the scheme

would clearly threaten its success for two reasons: emissions reductions that are limited

to a few provinces would fail to address climate change if they were offset by increased

emissions in other Canadian jurisdictions; and any province’s failure to implement a

sufficiently stringent GHG pricing mechanism could undermine the efficacy of GHG

pricing everywhere in Canada because of the risk of carbon leakage. Third, a province’s

failure to act or refusal to cooperate would have grave consequences for extraprovincial

interests. It is well established that climate change is causing significant environmental,

economic and human harm nationally and internationally, with especially high impacts

in the Canadian Arctic, coastal regions and on Indigenous peoples.

Although the matter has a clear impact on provincial jurisdiction, its impact

on the provinces’ freedom to legislate and on areas of life that would fall under

provincial heads of power is qualified and limited. First, the matter is limited to GHG

pricing of GHG emissions — a narrow and specific regulatory mechanism. If a

province fails to meet the minimum national standards, the GGPPA imposes a backstop

pricing system, but only to the extent necessary to remedy the deficiency in provincial

regulation to address the extraprovincial and international harm that might arise from

the province’s failure to act or to set sufficiently stringent standards. Second, the

matter’s impact on areas of life that would generally fall under provincial heads of

power is also limited. The discretion of the Governor in Council is necessary in order

to ensure that some provinces do not subordinate or unduly burden the other provinces

through their unilateral choice of standards. Although this restriction may interfere with

a province’s preferred balance between economic and environmental considerations, it

is necessary to consider the interests that would be harmed — owing to irreversible

consequences for the environment, for human health and safety and for the economy

— if Parliament were unable to constitutionally address the matter at a national level.

This irreversible harm would be felt across the country and would be borne

disproportionality by vulnerable communities and regions in Canada. The impact on

those interests justify the limited constitutional impact on provincial jurisdiction.

As a final matter, the fuel and excess emission charges imposed by the

GGPPA have a sufficient nexus with the regulatory scheme to be considered

constitutionally valid regulatory charges. To be a regulatory charge, as opposed to a

tax, a governmental levy with the characteristics of a tax must be connected to a

regulatory scheme. The first step is to identify the existence of a relevant regulatory

scheme; if such a scheme is found to exist, the second step is to establish a relationship

between the charge and the scheme itself. Influencing behaviour is a valid purpose for

a regulatory charge and regulatory charges need not reflect the cost of the scheme. The

amount of a regulatory charge whose purpose is to alter behaviour is set at a level

designed to proscribe, prohibit, or lend preference to a behaviour. Limiting such a

charge to the recovery of costs would be incompatible with the design of a scheme of

this nature. Nor must the revenues that are collected be used to further the purposes of

the regulatory scheme. Rather, the required nexus with the scheme will exist where the

charges themselves have a regulatory purpose. There is ample evidence that the fuel

and excess emission charges imposed by Parts 1 and 2 of the GGPPA have a regulatory

purpose. They cannot be characterized as taxes; rather, they are regulatory charges

whose purpose is to advance the GGPPA’s regulatory purpose by altering behaviour.

Per Côté J. (dissenting in part): There is agreement with the majority with

respect to the formulation of the national concern test. There is also agreement that

Parliament has the power to enact constitutionally valid legislation establishing

minimum national standards of price stringency to reduce GHG emissions. However,

the GGPPA is, in its current form, unconstitutional. It cannot be said to accord with the

matter of national concern formulated by the majority because the breadth of the

discretion that it confers on the Governor in Council results in no meaningful limits on

the power of the executive. Minimum standards are set by the executive, not the

GGPPA. Additionally, the provisions in the GGPPA that permit the Governor in

Council to amend and override the GGPPA violate the Constitution Act, 1867, and the

fundamental constitutional principles of parliamentary sovereignty, rule of law and the

separation of powers. Clauses that purport to confer on the executive branch the power

to nullify or amend Acts of Parliament are unconstitutional.

The GGPPA, as it is currently written, vests inordinate discretion in the

executive with no meaningful checks on fundamental alterations of the current pricing

scheme. The critical feature of the fuel levy established in Part 1, that being what fuels

are covered under the GGPPA, is so open-ended, allowing any substance, if prescribed

by the Governor in Council, to fall within the ambit of the fuel charge regime. The

operative provisions of Part 1 similarly prescribe vast law-making power to the

executive such that the very nature of the regime can be altered. The full breadth of

executive powers can be seen most notably within ss. 166 and 168. The only limit

whatsoever on the expansive regulation-making powers set out in s. 166 is that, in

amending Part 1 of Schedule 1 to modify the list of provinces where the fuel levy is

payable, the Governor in Council shall take into account, as the primary factor, the

stringency of provincial pricing mechanisms for GHGs (s. 166(3)). No such factor

applies to the Governor in Council’s regulation-making powers under Part 1’s

provisions, thus, by virtue of s. 166(4), the executive has a wholly-unfettered ability to

amend Part 1 of the GGPPA. Sections 168(2) and (3) also allow the Governor in

Council to make and amend regulations in relation to the fuel charge system, its

application, and its implementation. These wide-ranging powers set forth a wholly-

unfettered grant of broad discretion to amend Part 1. Most notably, s. 168(4) states that

in the event of a conflict between the statute enacted by Parliament and the regulations

made by the executive, the regulation prevails to the extent of the conflict. This

breathtaking power circumvents the exercise of law-making power by the legislative

branch by permitting the executive to amend by regulation the very statute which

authorizes the regulation.

Further, it is clear from a review of Part 2’s provisions that the broad

powers accorded to the executive permit the Governor in Council to regulate GHG

emissions broadly or regulate specific industries in other ways than by setting GHG

emissions limits and pricing excess emissions across the country, despite the majority’s

assertion to the contrary. The sole limit on the executive’s expansive discretion found

in Part 2, similar to Part 1, is in s. 189(2): when amending Part 2 of Schedule 1 to

modify the list of provinces where the output-based pricing system applies, the

Governor in Council shall take into account, as the primary factor, the stringency of

provincial pricing mechanisms for GHGs. Again, as in Part 1, no such factor applies to

the Governor in Council’s regulation-making powers under Part 2’s provisions. There

is agreement with Brown and Rowe JJ. that Part 2’s skeletal framework accords the

executive vast discretion to unilaterally set standards on an industry-by-industry basis,

creating the potential for differential treatment of industries at the executive’s whim.

Therefore, minimum standards are set by the executive, not the GGPPA.

Accordingly, the GGPPA cannot be said to establish national standards of price

stringency because there is no meaningful limit to the power of the executive. Rather

than establishing minimum national standards, Part 2 empowers the executive to

establish variable and inconsistent standards on an industry-by-industry basis. The fact

that the executive is permitted to place a number of conditions on individuals and

industries at any time, and is moreover allowed to revise those conditions at any time

to any extent, is untenable. The GGPPA, as it is currently written, employs a

discretionary scheme that knows no bounds. While it is agreed that a matter which is

restricted to minimum national GHG pricing stringency standards properly fits within

federal authority, the GGPPA does not reflect this crucial restriction.

Moreover, certain parts of the GGPPA are so inconsistent with our system

of democracy that they are independently unconstitutional. Sections 166(2), 166(4) and

192 all confer on the Governor in Council the power to amend parts of the GGPPA.

Section 168(4) confers the power to adopt secondary legislation that is inconsistent

with Part 1 of the Act. Executive power to amend or repeal provisions in primary

legislation raises serious constitutional concerns.

Sections 17 and 91 of the Constitution Act, 1867, both affirm that the

authority to legislate is exclusively exercisable by the Queen, with the advice and

consent of the Senate and the House of Commons. This means that every exercise of

the federal legislative power must have the consent of all three elements of Parliament.

The fundamental principles of the Constitution support this reading of ss. 17 and 19.

First, although Parliamentary sovereignty could appear to support

Parliament’s ability to delegate whatever they want to whomever they wish, this is not

the case. Parliamentary sovereignty contains both a positive and negative aspect. The

positive aspect is that Parliament has the ability to create any law. The negative aspect,

however, is that no institution is competent to override the requirements of an Act of

Parliament. Henry VIII clauses, as found in the GGPPA, run afoul of the negative

aspect of parliamentary sovereignty, as they give the executive the authority to override

the requirements of primary legislation and create a contradiction within an Act by

simultaneously requiring the executive to do something and authorizing the executive

to defy that requirement. Henry VIII clauses are also incompatible with the conception

of parliamentary sovereignty that demands an impartial, independent and authoritative

body to interpret Parliament’s acts, as they limit the availability of judicial review by

providing no meaningful limits against which a court could review.

Second, the rule of law, which provides a shield for individuals from

arbitrary state action, requires that all legislation be enacted in the manner and form

prescribed by law. This includes the requirements that legislation receive three readings

in the Senate and House of Commons and that it receive Royal Assent. When the

Governor in Council amends legislation, it does not follow this prescribed manner and

thus violates the rule of law. There are other additional rule of law concerns with the

delegation of legislative power to the executive: the delegation of power to amend a

statute is generally regarded as objectionable for the reason that the text of the statute

is then not to be found in the statute book, which gives rise to confusion and

uncertainty; Henry VIII clauses endow the executive with authority to act arbitrarily by

permitting it to act contrary to the empowering statute, creating an authority without

meaningful limits enforceable through judicial review and thus an absolute discretion;

and given that judicial review is constitutionally required, legislation cannot oust

review, either expressly or implicitly.

Lastly, the Constitution insists on a separation of powers according to the

separation of function among the three branches of government — the legislature, the

executive and the judiciary. The executive cannot interfere with the legislative process

in a manner that would restrict the power to enact, amend and repeal legislation, despite

the important role played by the executive in the legislative process. The separation of

powers equally demands that the core function of enacting, amending and repealing

statutes be protected from the executive and remain exclusive to the legislature. Doing

so supports the two main normative principles underlying the separation of powers: the

legislature is the institution best suited to set policy down into legislation, and limiting

the power to enact, amend and repeal legislation to the legislature helps to confine

power and prevent an even greater concentration of power in the executive. There is

nothing more core to the legislative power than legislating. When the executive usurps

this function, the separation of powers is clearly violated.

Per Brown J. (dissenting): The Greenhouse Gas Pollution Pricing Act

(“Act”) cannot be supported by any source of federal authority, and it is therefore

wholly ultra vires Parliament. The Act’s subject matter falls squarely within provincial

jurisdiction. The fact that the Act’s structure and operation is premised on provincial

legislatures having authority to enact the same scheme is fatal to the constitutionality

of the Act under Parliament’s residual authority to legislate with respect to matters of

national concern for the peace, order, and good government of Canada under the

Constitution Act, 1867.

There is agreement with Rowe J.’s reasons, and therefore Rowe J.’s review

of the jurisprudence on the residual POGG power is adopted. To determine whether an

enactment falls within the legislative authority of its enacting body, a reviewing court

must apply two steps: first, it must characterize the enactment to determine its pith and

substance or dominant subject matter and, secondly, it must classify the identified

subject matter, with reference to the classes of subjects or heads of power enumerated

in ss. 91 and 92 of the Constitution Act, 1867. Where an enumerated head of power is

relied upon, the pith and substance of the impugned law is identified at the

characterization step, and that pith and substance is then classified under a head of

power or class of subjects. Where Parliament relies upon the national concern branch

of POGG as the source of its authority to legislate, the analytical process differs. If it

is decided that the pith and substance of the impugned law does not fall under an

enumerated head of power, the reviewing court must then consider whether the matter

said to be of national concern satisfies the requirements of singleness, distinctiveness

and indivisibility as stated in Crown Zellerbach. If so, the matter is placed under

exclusive and permanent federal jurisdiction.

The dominant subject matter of an enactment is determined by considering

its purpose and effects. The purpose of characterization is to facilitate classification so

as to determine whether the Constitution grants the enacting body legislative authority

over the subject matter. The legislation’s dominant subject matter must therefore be

characterized precisely enough for it to be associated with a specific class of subjects

described in the Constitution’s heads of power. If an enactment’s subject matter could

be classified under different heads of power listed under both ss. 91 and 92 of the

Constitution Act, 1867, then the subject matter should be identified with more precision

until it is clear which single level of authority (as between federal and provincial) may

legislate in respect thereof.

As a sufficiently precise description may well refer to why and how the

law operates, it can be appropriate to include reference to the legislative means in the

pith and substance analysis. However, it is not appropriate to do so where describing

legislation only in terms of its means would not accurately capture its dominant subject

matter or where the description of the means is something that only federal legislative

authority can undertake, such as minimum national standards. The determinative

consideration in identifying an appropriate level of abstraction should be facilitating

the subject matter’s classification among the classes of subjects described in the

Constitution’s heads of power so far as necessary to resolve the case.

In this case, describing the Act’s pith and substance as relating to the

regulation of GHG emissions is too broad because it does not facilitate classification

under a federal or provincial head of power. Greater specificity in describing how the

legislation proposes to regulate GHG emissions is required so as to determine whether

the Constitution grants Parliament legislative authority over the subject matter.

However, the inclusion of minimum national standards in the pith and substance of the

Act is equally unhelpful. It adds nothing to the pith and substance of a matter, which is

directed not to the fact of a standard, but to the subject matter to which the standard is

to be applied. The inclusion of minimum national standards in the pith and substance

of a federal statute also effectively decides the jurisdictional dispute, given that only

Parliament is capable of imposing minimum national standards ⸺ only federally

enacted standards can apply nationwide, and, by operation of paramountcy, only

federally enacted standards can be a minimum. Furthermore, reference to “integral”

standards also has no relevance to identifying the Act’s pith and substance because such

a determination would require the Court to consider whether the standards set out in

the Act are effective, which is not a valid consideration in the pith and substance

analysis.

In order to characterize the Act’s pith and substance appropriately, its

purpose and effects must be determined. In this case, the pith and substance of Parts 1

and 2 of the Act must be characterized separately. While the two parts share a purpose

⸺ the reduction of GHG emissions ⸺ they are otherwise not remotely similar to each

other. They each have distinct operational features and the legislative means they

employ are mutually distinct. The pith and substance of Part 1 is the reduction of GHG

emissions by raising the cost of fuel. The pith and substance of Part 2 is the reduction

of GHG emissions by pricing emissions in a manner that distinguishes among

industries based on emissions intensity and trade exposure.

Once identified, the subject matter must be classified, with reference to the

classes of subjects or heads of power described in ss. 91 and 92 of the Constitution Act,

1867. Courts should look first to the enumerated powers, rather than immediately

considering whether a statute’s dominant subject matter fits within the residual POGG

authority.

In this case, provincial jurisdiction over property and civil rights authorized

by s. 92(13) stands out as the most relevant source of legislative authority for the pith

and substance of Parts 1 and 2 of the Act. Regulating trade and industrial activity, all

within the boundaries of specified provinces, is indisputably captured by this broad

head of power, which includes the regulation of business not coming within one of the

enumerated federal heads of power, as well as the law of property and of contracts. In

the alternative, the provincial residuum in s. 92(16), granting authority over all matters

of a local or private nature, could also authorize Parts 1 and 2. Part 2, as a deep foray

into industrial policy, also falls within matters of provincial legislative authority

granted by s. 92(10) over local works and undertakings. Also relevant to Part 2 is

s. 92A, which gives the provinces the exclusive jurisdiction to make laws in relation to

the exploration, development, conservation and management of non-renewable natural

resources in the province.

The identification of several applicable provincial heads of power should

be the end of the matter, since all such heads of power are, by the terms of ss. 92 and

92A(1), matters over which the provincial legislatures may exclusively make laws. By

the terms of s. 91, the POGG power applies only in relation to matters not coming

within the classes of subjects assigned exclusively to the legislatures of the provinces.

This exclusivity of provincial jurisdiction over matters falling under s. 92 is

fundamental to the Canadian brand of federalism, and was a unique and deliberate

choice by the makers of the Constitution who were concerned about federal overreach

via the POGG power. The federal law-making authority for the peace, order, and good

government of Canada was intended to be subject to the division of powers. Within

their areas of legislative authority, provinces are not only sovereign, but exclusively so.

The Act’s entire scheme is premised on the provinces having jurisdiction to do precisely

what Parliament has presumed to do in the Act ⸺ it operates only where provincial

legislative authority is not exercised, or not exercised in a manner acceptable to the

federal Cabinet. The Act’s backstop model is therefore constitutionally impossible: if

the provinces have jurisdiction to do what the Act does, then the Act cannot be

constitutional under the national concern branch of POGG. This demonstrates that

Parliament has legislated in respect of a matter that falls within provincial legislative

authority.

Even so, given the majority’s acceptance that some aspect of the Act is

truly and distinctly national in scope and lies outside provincial jurisdiction, the

question of whether the matter said to be of national concern satisfies the requirements

stated in Crown Zellerbach must be considered. The POGG jurisprudence offers little

guidance on the question of whether the pith and substance of the impugned legislation

can or should be coextensive with the matter of national concern, or whether the matter

of national concern can or should be broader than the pith and substance of the

legislation. It would be unprecedented and undesirable to accept that the matter of

national concern must always be the same as the pith and substance of the statute under

review, which can include legislative means, because this would effectively confine

Parliament to that particular legislative means in responding to the matter of national

concern.

It is not possible for a matter formerly under provincial jurisdiction to be

transformed, when minimum national standards are invoked, into a matter of national

concern. To accept that allocating national targets or minimum national standards can

serve as a basis for recognizing that some aspect of an area of provincial jurisdiction is

distinctly national in scope, and therefore lies outside provincial jurisdiction, would be

to accept a model of supervisory federalism by which the provinces can exercise their

jurisdiction only as long as they do so in a manner that the federal legislation authorizes.

This would open up any area of provincial jurisdiction to unconstitutional federal

intrusion once Parliament decides to legislate uniform treatment.

In this case, a broad characterization of the national concern is unavoidable

in order to encompass the pith and substance of both Part 1 and Part 2. The matter said

to be of national concern can therefore be identified as the purpose of the Act as a

whole: the reduction of GHG emissions. This matter does not meet the requirements of

Crown Zellerbach for a valid national concern: it fails to meet the requirements of

singleness and indivisibility. The fact that harms may cross borders is not enough to

make out indivisibility. The matter is divisible because GHGs emissions can be

connected to the source province. Responsibility for the reduction of GHG emissions

among the provinces can therefore be readily identified for regulation at the source of

the emissions. Nationwide GHG emissions are nothing more than the sum of provincial

and territorial GHG emissions. The reduction of GHG emissions therefore lacks the

degree of unity required to qualify as an indivisible matter of national concern. While

a provincial failure to deal effectively with the control or regulation of GHG emissions

may cause more emissions from that province to cross provincial boundaries, that is

insufficient to meet the requirement of indivisibility in Crown Zellerbach.

Even if each of the pith and substance of Parts 1 and 2 as proposed matters

of national concern are considered on their own, the pith and substance of each part is

not distinct from matters falling under provincial jurisdiction under s. 92; they therefore

do not meet the requirements of Crown Zellerbach. The reduction of GHG emissions

(whether by raising the cost of fuel, or by pricing emissions in a manner that

distinguishes among industries based on emissions intensity and trade exposure) does

not have the requisite distinctiveness to be recognized as a matter of national concern

because the Act encourages provinces to enact substantially the same scheme to serve

the same regulatory purpose. The provinces clearly have jurisdiction to establish

standards of GHG price stringency in the province.

The double aspect doctrine has no application in this case. While this

doctrine allows for the concurrent application of both federal and provincial legislation,

it does not create concurrent jurisdiction. The Act purports to do exactly what the

provinces can do, and for precisely the same reason. There are simply no distinctly

federal aspects of the reduction of GHG emissions that cannot be divided among the

enumerated heads of power. The imposition of minimum national standards cannot be

described as the distinctly federal aspect of the matter.

Even were the reduction of GHG emissions a single and indivisible area of

jurisdiction, its impact on provincial jurisdiction would be of a scale that is

irreconcilable with the division of powers. Because the power to legislate to reduce

GHG emissions effectively authorizes an array of regulations and extends to the

regulation of any activity that requires carbon-based fuel, it has the potential to undo

Canada’s division of powers. GHG emissions simply cannot be treated as a single

regulatory matter. While the Act does not forbid any activity, the charges it imposes

will affect the cost of fuel and dictate the viability of emissions-intensive trade-exposed

activities. These charges thereby stand to have a profound effect on provincial

jurisdiction and the division of powers. The division of powers analysis allows no

recourse to balancing or proportionality considerations. The Constitution Act, 1867,

sets out spheres of exclusive jurisdiction so that within their sphere of jurisdiction, the

provincial legislatures are sovereign, which sovereignty connotes provincial power to

act or not act as they see fit, not as long as they do so in a manner that finds approval

at the federal Cabinet table.

The delegation granted by the Act to the Cabinet is breathtakingly broad.

On this point, the guidance provided by Rowe J. is endorsed, both as to the imperative

that the division of powers confines the exercise by the federal Cabinet of Parliament’s

delegated authority, and as to the appropriate methodology for reviewing regulations

for compliance with the division of powers.

The long-established principles set down in Crown Zellerbach should not

be departed from. The doctrine of stare decisis establishes a high threshold for

departing from precedents and that threshold is not met in this case. There is

disagreement with the majority’s modernization of the national concern doctrine and

with the three-step framework it adopts, which dilutes the national concern test set

down in Crown Zellerbach. The framework adopted results in a new, distinctly

hierarchical and supervisory model of Canadian federalism that subjects provincial

legislative authority to Parliament’s overriding authority to establish national standards

of how such authority may be exercised and replaces the constitutionally mandated

division of powers with a judicially struck balance of power, which must account for

other interests. No province, and not even Parliament itself, ever agreed to ⸺ or even

contemplated ⸺ either of these features. This is a model of federalism that rejects the

Constitution and re-writes the rules of Confederation. Its implications go far beyond

the Act, opening the door to federal intrusion ⸺ by way of the imposition of national

standards ⸺ into all areas of provincial jurisdiction, including intra-provincial trade

and commerce, health, and the management of natural resources. It is bound to lead to

serious tensions in the federation. And all for no good reason, since Parliament could

have achieved its goals in constitutionally valid ways.

Per Rowe J. (dissenting): The national concern doctrine is a residual power

of last resort. Faithful adherence to the doctrine leads inexorably to the conclusion that

the national concern branch of the POGG power cannot be the basis for the

constitutionality of the Greenhouse Gas Pollution Pricing Act (“Act”). Accordingly,

there is agreement with Brown J.’s analysis and with his conclusion that the Act is ultra

vires in whole.

Federalism is one of the fundamental underlying principles animating the

Canadian Constitution. The primary textual expression of the principle of federalism

can be found in the division of powers effected mainly by ss. 91 and 92 of the

Constitution Act, 1867. An essential characteristic of the division of powers is its

exhaustiveness, which precludes legislative voids and reconciles parliamentary

sovereignty and federalism: it ensures that there is no subject matter which cannot be

legislated upon and that Canada, as a whole, is fully sovereign. The exhaustive nature

of the division of powers means that matters that do not come within the enumerated

classes must fit somewhere. This is dealt with by two residual clauses: one federal, and

one provincial. The federal residual clause, the POGG power, comes from the opening

words of s. 91 of the Constitution Act, 1867. The provincial residual clause is in

s. 92(16), and provides that the provincial legislatures may exclusively make laws

relating to matters of “a merely local or private Nature in the Province”. The wording

of s. 91 provides textual support for the view that the POGG power is residual to s. 92,

as s. 91 confers the power to legislate for peace, order and good government “in relation

to all Matters not coming within the Classes of Subjects by this Act assigned

exclusively to the Legislatures of the Provinces”. Further, every conferral of provincial

legislative jurisdiction is qualified by words such as “in the Province”, including

s. 92(16). The result is that the POGG power is limited to only those matters that are

not of a provincial nature, as the residual scope of the POGG power is narrowed by

s. 92(16), which applies to matters that are of a local and private nature even if they do

not come within any other enumerated head of power. The scope of s. 92(16) must be

interpreted as a counterbalance to the introductory paragraph of s. 91 to reflect the

constitutional principle that both Parliament and provincial legislatures must be seen

as equals. The POGG power is also residual to the federal heads of power, as the normal

process of constitutional interpretation is to rely first on a more specific provision

before resorting to a more general one.

Since the POGG power is residual to both the enumerated provincial and

federal heads of power, matters that come within enumerated federal or provincial

heads of power should be located in those enumerated heads and the POGG power

accommodates the matters which do not come within any of the enumerated federal or

provincial heads. There is no reason to hold that a matter falls under POGG when it

comes within an enumerated head of jurisdiction and it is not possible for a matter to

fall both within the POGG power and within a federal enumerated head of power at the

same time. If a matter cannot fit within any enumerated head, only then may resort be

had to the federal residual clause. This methodology helps ensure that the federal

residual power cannot be used as a tool to upset the balance of federalism by stripping

away provincial powers.

Courts have long struggled to define the contours of the POGG power in a

way that preserves the division of powers. Early POGG cases suffered from a series of

twists and turns, with various national concern statements infusing them at various

points. The common theme of these cases, however, is that courts rely on POGG to

give effect to the exhaustive nature of the division of powers, but courts have always

been cautious to guard provincial jurisdiction and ensure POGG does not become a

vehicle for federal overreach. The POGG jurisprudence should be read as signaling the

existence of just two branches: a general residual power and the emergency power.

What some commentators have named “gap” and “national concern” are simply

manifestations of the exhaustive nature of the division of powers, and the residual

nature of the POGG power. Matters that do not come within any enumerated head of

power or cannot be distributed among multiple heads of power must fit somewhere,

and they belong under POGG when they pass the test set out in Crown Zellerbach.

However, the analysis of the Crown Zellerbach framework would be the same even if

there is only one residual authority (POGG) and even if there are three branches to

POGG.

The national concern doctrine, when properly applied, plays an essential

role in achieving the goal that the division of powers be collectively exhaustive, in a

way that respects provincial jurisdiction. Matters that do not come within one of the

enumerated heads of jurisdiction and that cannot be separated and shared between the

enumerated heads of jurisdiction of both orders of government do not fit comfortably

within the division of powers. In order to maintain exhaustiveness, such matters fall

under the general residual power of Parliament by virtue of their distinctiveness from

matters under provincial jurisdiction and their indivisibility between various heads of

jurisdiction. But when the national concern doctrine is improperly applied, POGG

ceases to be residual in nature. When that is so, it can become an instrument to enhance

federal and correspondingly decrease provincial authority. Courts must be careful in

recognizing matters of national concern, because the national concern branch has great

potential to upset the division of powers. Once a matter is qualified as of national

concern, Parliament has exclusive jurisdiction over the matter, including its intra-

provincial aspects. Thus, an expansive interpretation of the doctrine can threaten the

fundamental structure of federalism and unduly restrain provincial legislature’s law-

making authority. It would allow Parliament to acquire exclusive jurisdiction over

matters that fall squarely within provincial jurisdiction and flatten regional differences.

Courts should never start a division of powers analysis by looking to the federal

residual power. To preserve the federal balance, courts should treat POGG as a power

of last resort. The scope of the national concern doctrine must be limited to matters that

cannot fall under other heads of jurisdiction and that cannot be distributed among

multiple heads, thus filling a constitutional gap. Accordingly, the doctrine only applies

to matters which are truly of national concern, as opposed to matters of a merely local

or private nature that fall under s. 92(16).

The national concern doctrine applies when two conditions are met: first,

the matter does not fall within (i.e., it is distinct from) the enumerated heads of

jurisdiction and, second, it is single and indivisible. The requirements of singleness,

distinctiveness and indivisibility serve the purpose of identifying matters that are truly

residual in two ways. The matter must be distinct from provincial matters and must be

incapable of division between both orders of government such that it must be entrusted

solely to Parliament. These requirements give effect to the general residual power of

Parliament under POGG and ensure that there is no jurisdictional gap in the division of

powers. They apply to both new matters and to matters which, although originally

falling under provincial jurisdiction, have come to extend beyond the powers of the

province and, due to indivisibility, must be entrusted exclusively to Parliament.

Given the residual nature of POGG, the importance of a matter has nothing

to do with whether it is a matter of national concern. The role of the general residual

power is to maintain the exhaustiveness of the division of powers, not to centralize

important matters that can be legislated upon by the provinces or by both orders of

government. First, the impugned matter must be distinct from matters falling under the

enumerated heads of s. 92. This will be met when the matter is beyond provincial reach,

including because of the limitation of provincial jurisdiction to matters in the province.

This inquiry includes consideration of the provincial residuum: if the matter is of a

merely local or private nature, it would fall under s. 92(16). The matter must also be

distinct from matters falling under federal jurisdiction, as POGG is purely residual.

Second, even if the matter does not come within an enumerated head of power, it must

be single and indivisible to fall under POGG rather than an aggregate that can be broken

down and distributed to enumerated heads of jurisdiction. The fact that provinces are

unable to deal with a matter is insufficient to conclude that it falls under POGG. The

nature of the matter must be such that it cannot be shared between both orders of

government and that it must be entrusted to Parliament, exclusively, to avoid a

jurisdictional vacuum.

In evaluating whether the matter has a singleness, distinctiveness and

indivisibility, it is relevant to consider what is known as the provincial inability test,

that is, what would be the effect on extra-provincial interests of a provincial failure to

deal effectively with the control or regulation of the intra-provincial aspect of the

matter. The provincial inability inquiry has been designed to control the centralization

of powers and to limit the extension of the national concern doctrine to matters that are

beyond the power of the provinces to deal with and that must be legislated upon by

Parliament, exclusively. Extra-provincial effects, on their own, are insufficient to

satisfy the provincial inability test. Rather, the extra-provincial effects must be such

that the matter, or part of the matter, is beyond the powers of the provinces to deal with

on their own or in tandem. If the pith and substance of provincial legislation comes

within the classes of subjects assigned to the provinces, incidental or ancillary extra-

provincial effects are irrelevant to its validity. Evidence that provinces are not

cooperating, even combined with the presence of extra-provincial effects, is also

insufficient to make out provincial inability. Provinces are sovereign within their

sphere of jurisdiction and can legitimately choose different policies than other

provinces. Further, provincial inability is no more than an indicium of singleness,

distinctiveness and indivisibility. In line with the residual role of POGG, federal

authority over what was formerly within provincial competence is only justified where

a matter has become distinct from what the provinces can do, and cannot be shared

between orders of government because of its indivisibility. In such a case, reliance on

POGG is the only way to maintain the exhaustiveness of the division of powers.

Otherwise, there would be a jurisdictional void — if the federal Parliament did not have

jurisdiction over such a matter, no one would.

When determining if a matter can pass muster as a subject matter falling

under POGG, the final consideration is whether it has a scale of impact on provincial

jurisdiction that is reconcilable with the fundamental distribution of legislative power

under the Constitution. The evaluation of the scale of impact on the federal balance

illustrates the need for caution when determining whether a new permanent head of

exclusive power should, in effect, be added to the federal list of powers. This prong of

the test requires courts to determine whether recognizing the proposed new federal

power would be compatible with the federal structure. It does not ask whether the

importance of the proposed new federal power outweighs the infringement on

provincial jurisdiction. Importance is irrelevant because it does not indicate whether

there is a jurisdictional gap that must be filled with the general residual power.

Important matters can and should be dealt with by the provinces. Courts must also be

careful not to let the double aspect doctrine undermine the scale of impact inquiry by

suggesting that provinces retain ample means to regulate the matter. The double aspect

doctrine recognizes that the same fact situation or matter may possess both federal and

provincial aspects, which means that both orders of government can legislate from their

respective perspective. This doctrine only applies when a subject matter has multiple

aspects, some that may be regulated under provincial jurisdiction, and some under

federal jurisdiction. The double aspect doctrine must be applied carefully, since

increasing overlap between provincial and federal competence can severely disrupt the

federal balance. The combined operation of the doctrines of double aspect and federal

paramountcy can have profound implications for the federal structure and for provincial

autonomy.

The national concern doctrine must be applied with caution in light of its

residual role and its potential to upset the division of powers. If the doctrine is not

strictly applied so as to limit it to ensuring that the division of powers is exhaustive, the

federal nature of the Constitution would disappear not gradually but rapidly.

Canada’s proposed doctrinal expansion of national concern should be

rejected because it departs in a marked and unjustified way from the jurisprudence of

the Court and, if adopted, it will provide a broad and open pathway for further

incursions into what has been exclusive provincial jurisdiction. In the instant case,

Canada’s proposed pith and substance of the Act of “establishing minimum national

standards integral to reducing nationwide GHG emissions” has not attained national

dimensions. While the seriousness or the immediacy of the threat that climate change

poses may be relevant to an argument under the emergency branch, it has no place in

the national concern analysis. Furthermore, the distinctiveness requirement is

inherently incompatible with the backstop nature of the Act, which contemplates that

some or all provinces could implement GHG pricing schemes that accord with

standards set (from time to time) by the federal Cabinet, thereby avoiding the triggering

of federal intervention. Singleness, distinctiveness and indivisibility should not be

collapsed into provincial inability, and provincial inability should not be informed by

tests for enumerated heads of power, because this approach fails to give effect to the

residual nature of the POGG power.

The device of “minimum national standards” makes wider still the pathway

for enhancement of federal jurisdiction. “By means of minimum national standards”

could be applied to any matter, and therefore adds nothing to the description of a matter

and has no place. Including “minimum national standards” in the matter of national

concern short-circuits the analysis and opens the door to federal “minimum standards”

with respect to other areas of provincial jurisdiction, artificially expanding federal

capacity to legislate in what have been until now matters coming within provincial

jurisdiction. This device undermines federalism by replacing provincial autonomy in

the exercise of its jurisdiction with the exercise of such jurisdiction made permanently

subject to federal supervision. Finally, the Act’s scale of impact on provincial

jurisdiction is not reconcilable with the distribution of powers. The Act leaves room for

provincial jurisdiction only insofar as the decision of the province conforms to the will

of Parliament and the federal Cabinet. It is not an exercise in cooperative federalism;

rather, it is the means to enforce supervisory federalism. The problem is not cured by

the double aspect doctrine: since the federal matter is defined in terms of the extent to

which it can limit the provinces’ discretion to legislate (the backstop mechanism), this

is not two aspects of the same fact situation — it is one aspect, and it gives the federal

government the upper hand and the final say. Parliament did not have jurisdiction to

enact the Act under its general residual power.

Cases Cited

By Wagner C.J.

Considered: Reference re Pan-Canadian Securities Regulation, 2018

SCC 48, [2018] 3 S.C.R. 189; Reference re Securities Act, 2011 SCC 66, [2011] 3

S.C.R. 837; Munro v. National Capital Commission, [1966] S.C.R. 663; Re: Anti-

Inflation Act, [1976] 2 S.C.R. 373; R. v. Hydro-Québec, [1997] 3 S.C.R. 213; R. v.

Crown Zellerbach Canada Ltd., [1988] 1 S.C.R. 401; Russell v. The Queen (1882), 7

App. Cas. 829; Attorney-General for Ontario v. Attorney-General for the Dominion,

[1896] A.C. 348; In Re “Insurance Act, 1910” (1913), 48 S.C.R. 260, aff’d Attorney-

General for Canada v. Attorney-General for Alberta, [1916] 1 A.C. 588; Attorney-

General for Ontario v. Canada Temperance Federation, [1946] A.C. 193; Johannesson

v. Municipality of West St. Paul, [1952] 1 S.C.R. 292; Interprovincial Co-operatives

Ltd. v. The Queen, [1976] 1 S.C.R. 477; Labatt Breweries of Canada Ltd. v. Attorney

General of Canada, [1980] 1 S.C.R. 914; Schneider v. The Queen, [1982] 2 S.C.R. 112;

R. v. Wetmore, [1983] 2 S.C.R. 284; Ontario Hydro v. Ontario (Labour Relations

Board), [1993] 3 S.C.R. 327; referred to: Reference re Secession of Quebec, [1998] 2

S.C.R. 217; Canadian Western Bank v. Alberta, 2007 SCC 22, [2007] 2 S.C.R. 3; R. v.

Comeau, 2018 SCC 15, [2018] 1 S.C.R. 342; Reference re Remuneration of Judges of

the Provincial Court of Prince Edward Island, [1997] 3 S.C.R. 3; Reference re Genetic

Non-Discrimination Act, 2020 SCC 17; Desgagnés Transport Inc. v. Wärtsilä Canada

Inc., 2019 SCC 58; Kitkatla Band v. British Columbia (Minister of Small Business,

Tourism and Culture), 2002 SCC 31, [2002] 2 S.C.R. 146; R. v. Morgentaler, [1993] 3

S.C.R. 463; Ward v. Canada (Attorney General), 2002 SCC 17, [2002] 1 S.C.R. 569;

Reference re Assisted Human Reproduction Act, 2010 SCC 61, [2010] 3 S.C.R. 457;

Quebec (Attorney General) v. Canada (Attorney General), 2015 SCC 14, [2015] 1

S.C.R. 693; Goodwin v. British Columbia (Superintendent of Motor Vehicles), 2015

SCC 46, [2015] 3 S.C.R. 250; Reference re Firearms Act (Can.), 2000 SCC 31, [2000]

1 S.C.R. 783; Reference re Employment Insurance Act (Can.), ss. 22 and 23, 2005 SCC

56, [2005] 2 S.C.R. 669; Chatterjee v. Ontario (Attorney General), 2009 SCC 19,

[2009] 1 S.C.R. 624; Re: Exported Natural Gas Tax, [1982] 1 S.C.R. 1004; R. v. Swain,

[1991] 1 S.C.R. 933; Siemens v. Manitoba (Attorney General), 2003 SCC 3, [2003] 1

S.C.R. 6; Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd., 2015 SCC

53, [2015] 3 S.C.R. 419; Attorney-General for Alberta v. Attorney-General for Canada,

[1939] A.C. 117; Canadian National Railway Co. v. Canada (Attorney General), 2014

SCC 40, [2014] 2 S.C.R. 135; Canada (Minister of Citizenship and Immigration) v.

Vavilov, 2019 SCC 65; Katz Group Canada Inc. v. Ontario (Health and Long-Term

Care), 2013 SCC 64, [2013] 3 S.C.R. 810; Roncarelli v. Duplessis, [1959] S.C.R. 121;

Quebec (Attorney General) v. Canadian Owners and Pilots Association, 2010 SCC 39,

[2010] 2 S.C.R. 536; Hodge v. The Queen (1883), 9 App. Cas. 117; Re George Edwin

Gray (1918), 57 S.C.R. 150; Shannon v. Lower Mainland Dairy Products Board,

[1938] A.C. 708; Reference as to the Validity of the Regulations in relation to

Chemicals, [1943] S.C.R. 1; R. v. Furtney, [1991] 3 S.C.R. 89; R. v. P. (J.) (2003), 67

O.R. (3d) 321; Canadian Generic Pharmaceutical Association v. Canada (Health),

2010 FCA 334, [2012] 2 F.C.R. 618; House of Sga’nisim v. Canada (Attorney

General), 2013 BCCA 49, 41 B.C.L.R. (5th) 23; Waddell v. Governor in Council

(1983), 8 Admin. L.R. 266; Pronto Uranium Mines Limited v. The Ontario Labour

Relations Board, [1956] O.R. 862; Denison Mines Ltd. v. Attorney-General of Canada,

[1973] 1 O.R. 797; Morguard Investments Ltd. v. De Savoye, [1990] 3 S.C.R. 1077;

RJR-MacDonald Inc. v. Canada (Attorney General), [1995] 3 S.C.R. 199; Quebec

(Attorney General) v. Lacombe, 2010 SCC 38, [2010] 2 S.C.R. 453; General Motors

of Canada Ltd. v. City National Leasing, [1989] 1 S.C.R. 641; Multiple Access Ltd. v.

McCutcheon, [1982] 2 S.C.R. 161; Bell Canada v. Quebec (Commission de la santé et

de la sécurité du travail), [1988] 1 S.C.R. 749; Rogers Communications Inc. v.

Châteauguay (City), 2016 SCC 23, [2016] 1 S.C.R. 467; Friends of the Oldman River

Society v. Canada (Minister of Transport), [1992] 1 S.C.R. 3; Attorney-General for

Canada v. Attorney-General for Ontario, [1937] A.C. 326; Massachusetts v.

Environmental Protection Agency, 549 U.S. 497 (2007); The State of the Netherlands

(Ministry of Economic Affairs and Climate Policy) v. Stichting Urgenda,

ECLI:NL:HR:2019:2007; Stichting Urgenda v. The State of the Netherlands (Ministry

of Infrastructure and the Environment), ECLI:NL:RBDHA:2015:7196; Gloucester

Resources Limited v. Minister for Planning, [2019] N.S.W.L.E.C. 7; Conseil scolaire

francophone de la Colombie-Britannique v. British Columbia, 2020 SCC 13; Citizens

Insurance Co. v. Parsons (Canada), [1881] 7 App. Cas. 96; Westbank First Nation v.

British Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134; 620 Connaught

Ltd. v. Canada (Attorney General), 2008 SCC 7, [2008] 1 S.C.R. 131; Canadian Assn.

of Broadcasters v. Canada (F.C.A.), 2008 FCA 157, [2009] 1 F.C.R. 3; Allard

Contractors Ltd. v. Coquitlam (District), [1993] 4 S.C.R. 371; Eurig Estate (Re),

[1998] 2 S.C.R. 565.

By Côté J. (dissenting in part)

Reference re Secession of Quebec, [1998] 2 S.C.R. 217; Reference re

Remuneration of Judges of the Provincial Court of Prince Edward Island, [1997] 3

S.C.R. 3; Reference re Senate Reform, 2014 SCC 32, [2014] 1 S.C.R. 704; Hunter v.

Southam Inc., [1984] 2 S.C.R. 145; R. v. Big M Drug Mart Ltd., [1985] 1 S.C.R. 295;

OPSEU v. Ontario (Attorney General), [1987] 2 S.C.R. 2; Re: Authority of Parliament

in relation to the Upper House, [1980] 1 S.C.R. 54; Hodge v. The Queen (1883), 9 App.

Cas. 117; In re Initiative and Referendum Act, [1919] A.C. 935; Re The Initiative and

Referendum Act (1916), 27 Man. R. 1; Reference re Manitoba Language Rights, [1985]

1 S.C.R. 721; Re George Edwin Gray (1918), 57 S.C.R. 150; Reference as to the

Validity of the Regulations in relation to Chemicals, [1943] S.C.R. 1; R. v. Furtney,

[1991] 3 S.C.R. 89; Attorney General of Nova Scotia v. Attorney General of Canada,

[1951] S.C.R. 31; Reference re Pan-Canadian Securities Regulation, 2018 SCC 48,

[2018] 3 S.C.R. 189; British Columbia v. Imperial Tobacco Canada Ltd., 2005 SCC

49, [2005] 2 S.C.R. 473; Babcock v. Canada (Attorney General), 2002 SCC 57, [2002]

3 S.C.R. 3; Reference re Securities Act, 2011 SCC 66, [2011] 3 S.C.R. 837; R. v.

Shoreditch Assessment Committee, [1910] 2 K.B. 859; R. (Cart) v. Upper Tribunal,

[2009] EWHC 3052 (Admin.), [2011] Q.B. 120; R. (Privacy International) v.

Investigatory Powers Tribunal, [2019] UKSC 22, [2020] A.C. 491; Roncarelli v.

Duplessis, [1959] S.C.R. 121; Authorson v. Canada (Attorney General), 2003 SCC 39,

[2003] 2 S.C.R. 40; Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019

SCC 65; Crevier v. Attorney General of Quebec, [1981] 2 S.C.R. 220; Dr. Q v. College

of Physicians and Surgeons of British Columbia, 2003 SCC 19, [2003] 1 S.C.R. 226;

Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190; Ontario Public School

Boards’ Assn. v. Ontario (Attorney General) (1997), 151 D.L.R. (4th) 346; Wells v.

Newfoundland, [1999] 3 S.C.R. 199; Doucet-Boudreau v. Nova Scotia (Minister of

Education), 2003 SCC 62, [2003] 3 S.C.R. 3; Cooper v. Canada (Human Rights

Commission), [1996] 3 S.C.R. 854; Attorney General of Quebec v. Blaikie, [1981] 1

S.C.R. 312; Canada (Auditor General) v. Canada (Minister of Energy, Mines and

Resources), [1989] 2 S.C.R. 49; Fraser v. Public Service Staff Relations Board, [1985]

2 S.C.R. 455; Ontario v. Criminal Lawyers’ Association of Ontario, 2013 SCC 43,

[2013] 3 S.C.R. 3; New Brunswick Broadcasting Co. v. Nova Scotia (Speaker of the

House of Assembly), [1993] 1 S.C.R. 319; MacMillan Bloedel Ltd. v. Simpson, [1995] 4

S.C.R. 725; Reference re Amendments to the Residential Tenancies Act (N.S.), [1996]

1 S.C.R. 186; Trial Lawyers Association of British Columbia v. British Columbia

(Attorney General), 2014 SCC 59, [2014] 3 S.C.R. 31; Operation Dismantle Inc. v. The

Queen, [1985] 1 S.C.R. 441; Canada (Prime Minister) v. Khadr, 2010 SCC 3, [2010]

1 S.C.R. 44; Hupacasath First Nation v. Canada (Minister of Foreign Affairs), 2015

FCA 4, 379 D.L.R. (4th) 737; Carey v. Ontario, [1986] 2 S.C.R. 637; Canada (House

of Commons) v. Vaid, 2005 SCC 30, [2005] 1 S.C.R. 667; Chagnon v. Syndicat de la

fonction publique et parapublique du Québec, 2018 SCC 39, [2018] 2 S.C.R 687;

Mikisew Cree First Nation v. Canada (Governor General in Council), 2018 SCC 40,

[2018] 2 S.C.R. 765.

By Brown J. (dissenting)

R. v. Crown Zellerbach Canada Ltd., [1988] 1 S.C.R. 401; Desgagnés

Transport Inc. v. Wärtsilä Canada Inc., 2019 SCC 58; Chatterjee v. Ontario (Attorney

General), 2009 SCC 19, [2009] 1 S.C.R. 624; Whitbread v. Walley, [1990] 3 S.C.R.

1273; R. v. Morgentaler, [1993] 3 S.C.R. 463; Quebec (Attorney General) v. Canada

(Attorney General), 2015 SCC 14, [2015] 1 S.C.R. 693; Reference re Assisted Human

Reproduction Act, 2010 SCC 61, [2010] 3 S.C.R. 457; Friends of the Oldman River

Society v. Canada (Minister of Transport), [1992] 1 S.C.R. 3; R. v. Hydro-Québec,

[1997] 3 S.C.R. 213; Ward v. Canada (Attorney General), 2002 SCC 17, [2002] 1

S.C.R. 569; Reference re Securities Act, 2011 SCC 66, [2011] 3 S.C.R. 837; Re:

Anti-Inflation Act, [1976] 2 S.C.R. 373; Citizens Insurance Co. v. Parsons (1881), 7

App. Cas. 96; Ontario Hydro v. Ontario (Labour Relations Board), [1993] 3 S.C.R.

327; Westcoast Energy Inc. v. Canada (National Energy Board), [1998] 1 S.C.R. 322;

Quebec (Attorney General) v. Lacombe, 2010 SCC 38, [2010] 2 S.C.R. 453; Reference

re Firearms Act (Can.), 2000 SCC 31, [2000] 1 S.C.R. 783; Johannesson v.

Municipality of West St. Paul, [1952] 1 S.C.R. 292; Munro v. National Capital

Commission, [1966] S.C.R. 663; Reference re Pan-Canadian Securities Regulation,

2018 SCC 48, [2018] 3 S.C.R. 189; General Motors of Canada Ltd. v. City National

Leasing, [1989] 1 S.C.R. 641; Reference re Secession of Quebec, [1998] 2 S.C.R. 217;

Attorney-General for Ontario v. Attorney-General for the Dominion, [1896] A.C. 348;

Canadian Western Bank v. Alberta, 2007 SCC 22, [2007] 2 S.C.R. 3; Bell Canada v.

Quebec (Commission de la santé et de la sécurité du travail), [1988] 1 S.C.R. 749;

Reference re Genetic Non-Discrimination Act, 2020 SCC 17; Ontario English Catholic

Teachers’ Assn. v. Ontario (Attorney General), 2001 SCC 15, [2001] 1 S.C.R. 470; Re:

Exported Natural Gas Tax, [1982] 1 S.C.R. 1004; Westbank First Nation v. British

Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134; 620 Connaught Ltd. v.

Canada (Attorney General), 2008 SCC 7, [2008] 1 S.C.R. 131; Attorney-General for

Canada v. Attorney-General for Ontario, [1937] A.C. 355; Canada (Minister of

Citizenship and Immigration) v. Vavilov, 2019 SCC 65; Attorney-General for Canada

v. Attorney-General for Ontario, [1937] A.C. 326; Vriend v. Alberta, [1998] 1 S.C.R.

493; Hunter v. Southam Inc., [1984] 2 S.C.R. 145.

By Rowe J. (dissenting)

R. v. Crown Zellerbach Canada Ltd., [1988] 1 S.C.R. 401; Canadian

Western Bank v. Alberta, 2007 SCC 22, [2007] 2 S.C.R. 3; Quebec (Attorney General)

v. 9147-0732 Québec inc., 2020 SCC 32; Reference re Secession of Quebec, [1998] 2

S.C.R. 217; Reference re Genetic Non-Discrimination Act, 2020 SCC 17; Reference re

Same-Sex Marriage, 2004 SCC 79, [2004] 3 S.C.R. 698; Quebec (Attorney General) v.

Canada (Attorney General), 2015 SCC 14, [2015] 1 S.C.R. 693; Attorney-General for

Canada v. Attorney-General for Ontario, [1937] A.C. 326; Newfoundland and

Labrador (Attorney General) v. Uashaunnuat (Innu of Uashat and of Mani-Utenam),

2020 SCC 4; In re Regulation and Control of Aeronautics in Canada, [1932] A.C. 54;

Reference re Securities Act, 2011 SCC 66, [2011] 3 S.C.R. 837; Liquidators of the

Maritime Bank of Canada v. Receiver-General of New Brunswick, [1892] A.C. 437;

114957 Canada Ltée (Spraytech, Société d’arrosage) v. Hudson (Town), 2001 SCC 40,

[2001] 2 S.C.R. 241; New State Ice Co. v. Liebmann, 285 U.S. 262 (1932); R. v.

Comeau, 2018 SCC 15, [2018] 1 S.C.R. 342; Reference re Pan-Canadian Securities

Regulation, 2018 SCC 48, [2018] 3 S.C.R. 189; Rogers Communications Inc. v.

Châteauguay (City), 2016 SCC 23, [2016] 1 S.C.R. 467; Edwards v. Attorney-General

for Canada, [1930] A.C. 124; Reference re Employment Insurance Act (Can.), ss. 22

and 23, 2005 SCC 56, [2005] 2 S.C.R. 669; Marcotte v. Fédération des caisses

Desjardins du Québec, 2014 SCC 57, [2014] 2 S.C.R. 805; Canada (Attorney General)

v. Hislop, 2007 SCC 10, [2007] 1 S.C.R. 429; Citizens Insurance Co. of Canada v.

Parsons (1881), 7 App. Cas. 96; Attorney-General for Ontario v. Attorney-General for

the Dominion, [1896] A.C. 348; Toronto Electric Commissioners v. Snider, [1925]

A.C. 396; Ontario Hydro v. Ontario (Labour Relations Board), [1993] 3 S.C.R. 327;

In re Regulation and Control of Radio Communication in Canada, [1932] A.C. 304;

Nova Scotia Board of Censors v. McNeil, [1978] 2 S.C.R. 662; Reference re The Farm

Products Marketing Act, [1957] S.C.R. 198; Reference re Assisted Human

Reproduction Act, 2010 SCC 61, [2010] 3 S.C.R. 457; R. v. Hauser, [1979] 1 S.C.R.

984; Schneider v. The Queen, [1982] 2 S.C.R. 112; Russell v. The Queen (1882), 7 App.

Cas. 829; Fort Frances Pulp and Power Co. v. Manitoba Free Press Co., [1923] A.C.

695; Attorney-General for Ontario v. Canada Temperance Federation, [1946] A.C.

193; Johannesson v. Municipality of West St. Paul, [1952] 1 S.C.R. 292; Munro v.

National Capital Commission, [1966] S.C.R. 663; Re: Anti-Inflation Act, [1976] 2

S.C.R. 373; Labatt Breweries of Canada Ltd. v. Attorney General of Canada, [1980] 1

S.C.R. 914; R. v. Wetmore, [1983] 2 S.C.R. 284; R. v. Hydro-Québec, [1997] 3 S.C.R.

213; Friends of the Oldman River Society v. Canada (Minister of Transport), [1992] 1

S.C.R. 3; In re “Insurance Act, 1910” (1913), 48 S.C.R. 260, aff’d Attorney-General

for Canada v. Attorney-General for Alberta, [1916] 1 A.C. 588; Global Securities

Corp. v. British Columbia (Securities Commission), 2000 SCC 21, [2000] 1 S.C.R. 494;

British Columbia v. Imperial Tobacco Canada Ltd., 2005 SCC 49, [2005] 2 S.C.R.

473; Desgagnés Transport Inc. v. Wärtsilä Canada Inc., 2019 SCC 58; O’Grady v.

Sparling, [1960] S.C.R. 804; Mann v. The Queen, [1966] S.C.R. 238; Multiple Access

Ltd. v. McCutcheon, [1982] 2 S.C.R. 161; Bell Canada v. Quebec (Commission de la

santé et de la sécurité du travail), [1988] 1 S.C.R. 749; Saskatchewan (Attorney

General) v. Lemare Lake Logging Ltd., 2015 SCC 53, [2015] 3 S.C.R. 419; Rothmans,

Benson & Hedges Inc. v. Saskatchewan, 2005 SCC 13, [2005] 1 S.C.R. 188; Canada

(Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65; City of Arlington,

Texas v. Federal Communications Commission, 569 U.S. 290 (2013); Ward v. Canada

(Attorney General), 2002 SCC 17, [2002] 1 S.C.R. 569; Fédération des producteurs de

volailles du Québec v. Pelland, 2005 SCC 20, [2005] 1 S.C.R. 292; Syncrude Canada

Ltd. v. Canada (Attorney General), 2016 FCA 160, 398 D.L.R. (4th) 91; Quebec

(Attorney General) v. Lacombe, 2010 SCC 38, [2010] 2 S.C.R. 453; Thorne’s

Hardware Ltd. v. The Queen, [1983] 1 S.C.R. 106; Heppner v. Province of Alberta

(1977), 6 A.R. 154; Bristol-Myers Squibb Co. v. Canada (Attorney General), 2005 SCC

26, [2005] 1 S.C.R. 533.

Statutes and Regulations Cited

An Act for the better regulating the Government of the Province of the Massachuset’s

Bay in New England (G.B.), 1774, 14 Geo. 3, c. 45.

An Act that Proclamations made by the King shall be obeyed (Eng.), 1539, 31 Hen. 8,

c. 8.

An Act to make temporary Provision for the Government of Lower Canada (U.K.),

1838, 1 & 2 Vict., c. 9.

An Act to provide for the Government of British Columbia (U.K.), 1858, 21 & 22 Vict.,

c. 99.

Bill C-74, An Act to implement certain provisions of the budget, 1st Sess., 42nd Parl.,

2018.

Budget Implementation Act, 2018, No. 2, S.C. 2018, c. 27, s. 13.

Canadian Charter of Rights and Freedoms, preamble, s. 5.

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APPEAL from a judgment of the Saskatchewan Court of Appeal (Richards

C.J.S. and Jackson, Ottenbreit, Caldwell and Schwann JJ.A.), 2019 SKCA 40, 435

C.R.R. (2d) 1, 2019 D.T.C. 5055, [2019] 9 W.W.R. 377, 440 D.L.R. (4th) 398, [2019]

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concerning the constitutionality of the Greenhouse Gas Pollution Pricing Act. Appeal

dismissed, Côté J. dissenting in part and Brown and Rowe JJ. dissenting.

APPEAL from a judgment of the Ontario Court of Appeal (Strathy C.J.O.,

Hoy A.C.J.O. and MacPherson, Sharpe and Huscroft JJ.A.), 2019 ONCA 544, 146 O.R.

(3d) 65, 2019 D.T.C. 5090, 436 D.L.R. (4th) 1, 29 C.E.L.R. (4th) 113, [2019] O.J. No.

3403 (QL), 2019 CarswellOnt 10495 (WL Can.), in the matter of a reference

concerning the constitutionality of the Greenhouse Gas Pollution Pricing Act. Appeal

dismissed, Côté J. dissenting in part and Brown and Rowe JJ. dissenting.

APPEAL from a judgment of the Alberta Court of Appeal (Fraser C.J.A.

and Watson, Wakeling, Hughes and Feehan JJ.A.), 2020 ABCA 74, 3 Alta. L.R. (7th)

1, 2020 D.T.C. 5025, [2021] 1 W.W.R. 1, 446 D.L.R. (4th) 1, 35 C.E.L.R. (4th) 1,

[2020] A.J. No. 234 (QL), 2020 CarswellAlta 328 (WL Can.), in the matter of a

reference concerning the constitutionality of the Greenhouse Gas Pollution Pricing

Act. Appeal allowed, Côté J. dissenting in part and Brown and Rowe JJ. dissenting.

P. Mitch McAdam, Q.C., and Deron Kuski, Q.C., for the Attorney General

of Saskatchewan.

Josh Hunter and Padraic Ryan, for the Attorney General of Ontario.

J. Gareth Morley and Jacqueline D. Hughes, for the Attorney General of

British Columbia.

Sharlene Telles-Langdon and Guy Pratte, for the Attorney General of

Peter A. Gall, Q.C., and L. Christine Enns, Q.C., for the Attorney General

Canada.

of Alberta.

Jean-Vincent Lacroix, for the intervener the Attorney General of Quebec.

Rachelle Standing, for the intervener the Attorney General of New

Brunswick.

Michael Conner, for the intervener the Attorney General of Manitoba.

Martin Olszynski, for the intervener Progress Alberta Communications

Limited.

Patricia Lawrence, for the interveners the Anishinabek Nation and the

United Chiefs and Councils of Mnidoo Mnising.

Simon Archer, for the intervener the Canadian Labour Congress.

David M. A. Stack, Q.C., for the interveners the Saskatchewan Power

Corporation and SaskEnergy Incorporated.

David W. L. Wu, for the intervener the Oceans North Conservation Society.

Stuart Wuttke, for the intervener the Assembly of First Nations.

Bruce Hallsor, Q.C., for the intervener the Canadian Taxpayers

Federation.

Stewart Elgie, for the intervener Canada’s Ecofiscal Commission.

Joseph F. Castrilli, for the interveners the Canadian Environmental Law

Association, Environmental Defence Canada Inc. and the Sisters of Providence of St.

Vincent de Paul.

Justin Safayeni, for the intervener Amnesty International Canada.

Nathalie Chalifour, for the interveners the National Association of Women

and the Law and Friends of the Earth.

Elisabeth DeMarco, for the intervener the International Emissions Trading

Association.

Joshua Ginsberg, for the intervener the David Suzuki Foundation.

Amir Attaran, for the intervener the Athabasca Chipewyan First Nation.

Jeremy de Beer, for the intervener the Smart Prosperity Institute.

Jennifer L. King, for the intervener the Canadian Public Health

Association.

Larry Kowalchuk, for the interveners Climate Justice Saskatoon, the

National Farmers Union, the Saskatchewan Coalition for Sustainable Development, the

Saskatchewan Council for International Cooperation, the Saskatchewan Environmental

Society, SaskEV, the Council of Canadians: Prairie and Northwest Territories Region,

the Council of Canadians: Regina Chapter, the Council of Canadians: Saskatoon

Chapter, the New Brunswick Anti-Shale Gas Alliance and the Youth of the Earth.

David Robitaille, for the interveners Centre québécois du droit de

l’environnement and Équiterre.

Nathan Hume, for the interveners Generation Squeeze, the Public Health

Association of British Columbia, the Saskatchewan Public Health Association, the

Canadian Association of Physicians for the Environment, the Canadian Coalition for

the Rights of the Child and the Youth Climate Lab.

Joëlle Pastora Sala, for the intervener the Assembly of Manitoba Chiefs.

Paul A. Hildebrand, for the interveners the City of Richmond, the City of

Victoria, the City of Nelson, the District of Squamish, the City of Rossland and the

City of Vancouver.

Dusty T. Ernewein, for the intervener the Thunderchild First Nation.

The judgment of Wagner C.J. and Abella, Moldaver, Karakatsanis, Martin and Kasirer

JJ. was delivered by

THE CHIEF JUSTICE —

TABLE OF CONTENTS

Paragraph

I. Overview

1

II. Reference Question

6

III. Background

7

A. The Global Climate Crisis

7

B. Canada’s Efforts to Address Climate Change

C. Provincial Action on Climate Change

IV. The GGPPA

13

23

25

26

28

30

34

39

41

A. Basic Architecture of the GGPPA

B. The Preamble

C. Part 1: Fuel Charge

D. Part 2: Industrial Greenhouse Gas Emissions

V. Judicial History

A. Court of Appeal for Saskatchewan, 2019 SKCA 40, 440 D.L.R. (4th) 398

B. Court of Appeal for Ontario, 2019 ONCA 544, 146 O.R. (3d) 65

C. Court of Appeal of Alberta, 2020 ABCA 74, 3 Alta. L.R. (7th) 1

VI. Analysis

44

47

A. Principle of Federalism

48

B. Characterization of the GGPPA

Overarching Principles

51

Application to the GGPPA

57

Intrinsic Evidence

58

Extrinsic Evidence

62

Legal Effects

70

Practical Effects

77

Conclusion on Pith and Substance

C. Classification of the GGPPA

National Concern Doctrine

80

89

Origins of the National Concern Doctrine

Early Application of the National Concern Doctrine by the Court

Development of the National Concern Test

Clarifying the National Concern Doctrine

“Matter” of National Concern

92

98

101

110

114

120

Exclusive Federal Jurisdiction Based on the National Concern

Doctrine

National Concern Test

132

142

145

160

162

167

172

196

207

Threshold Question

Singleness, Distinctiveness and Indivisibility

Scale of Impact

Summary of the Framework

Application to the GGPPA

Threshold Question

Singleness, Distinctiveness and Indivisibility

Scale of Impact

Conclusion on the National Concern Doctrine

VII. Validity of the Levies as Regulatory Charges

VIII.A Final Matter

212

220

221

IX. Conclusion

I.

Overview

[1]

In 2018, Parliament enacted the Greenhouse Gas Pollution Pricing Act,

S.C. 2018, c. 12, s. 186 (“GGPPA”). Three provinces challenged the constitutionality

of the GGPPA by references to their respective courts of appeal. The question divided

the courts. In split decisions, the courts of appeal for Saskatchewan and Ontario held

that the GGPPA is constitutional, while the Court of Appeal of Alberta held that it is

unconstitutional. Those decisions have now been appealed to this Court.

[2]

The essential factual backdrop to these appeals is uncontested. Climate

change is real. It is caused by greenhouse gas emissions resulting from human

activities, and it poses a grave threat to humanity’s future. The only way to address the

threat of climate change is to reduce greenhouse gas emissions. In the Paris Agreement,

U.N. Doc. FCCC/CP/2015/10/Add.1, December 12, 2015, states around the world

undertook to drastically reduce their greenhouse gas emissions in order to mitigate the

effects of climate change. In Canada, Parliament enacted the GGPPA as part of the

country’s effort to implement its commitment.

[3]

However, none of these facts answer the question in these appeals. The

issue here is whether Parliament had the constitutional authority to enact the GGPPA.

To answer this question, the Court must identify the true subject matter of the GGPPA

and then classify that subject matter with reference to the division of powers set out in

the Constitution Act, 1867 (“Constitution”). In doing so, the Court must give effect to

the principle of federalism, a foundational principle of the Canadian Constitution,

which requires that an appropriate balance be maintained between the powers of the

federal government and those of the provinces.

[4]

Below, I conclude that the GGPPA sets minimum national standards of

greenhouse gas price stringency to reduce greenhouse gas emissions, pollutants that

cause serious extraprovincial harm. Parliament has jurisdiction to enact this law as a

matter of national concern under the “Peace, Order, and good Government” clause of

s. 91 of the Constitution. National concern is a well-established but rarely applied

doctrine of Canadian constitutional law. The application of this doctrine is strictly

limited in order to maintain the autonomy of the provinces and respect the diversity of

Confederation, as is required by the principle of federalism. However, Parliament has

the authority to act in appropriate cases, where there is a matter of genuine national

concern and where the recognition of that matter is consistent with the division of

powers. In this case, Parliament has acted within its jurisdiction.

[5]

I also conclude that the levies imposed by the GGPPA are constitutionally

valid regulatory charges. In the result, the GGPPA is constitutional.

II. Reference Question

[6]

The reference question in each of the three appeals is substantially the

same: Is the Greenhouse Gas Pollution Pricing Act unconstitutional in whole or in

part?

III. Background

A. The Global Climate Crisis

[7]

Global climate change is real, and it is clear that human activities are the

primary cause. In simple terms, the combustion of fossil fuels releases greenhouse

gases (“GHGs”) into the atmosphere, and those gases trap solar energy from the sun’s

incoming radiation in the atmosphere instead of allowing it to escape, thereby warming

the planet. Carbon dioxide is the most prevalent and recognizable GHG resulting from

human activities. Other common GHGs include methane, nitrous oxide,

hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and nitrogen trifluoride.

[8]

At appropriate levels, GHGs are beneficial, keeping temperatures around

the world at levels at which humans, animals, plants and marine life can live in balance.

And the level of GHGs in the atmosphere has been relatively stable over the last

400,000 years. Since the 1950s, however, the concentrations of GHGs in the

atmosphere have increased at an alarming rate, and they continue to rise. As a result,

global surface temperatures have already increased by 1.0°C above pre-industrial

levels, and that increase is expected to reach 1.5°C by 2040 if the current rate of

warming continues.

[9]

These temperature increases are significant. As a result of the current

warming of 1.0°C, the world is already experiencing more extreme weather, rising sea

levels and diminishing Arctic sea ice. Should warming reach or exceed 1.5°C, the world

could experience even more extreme consequences, including still higher sea levels and

greater loss of Arctic sea ice, a 70 percent or greater global decline of coral reefs, the

thawing of permafrost, ecosystem fragility and negative effects on human health,

including heat-related and ozone-related morbidity and mortality.

[10]

The effects of climate change have been and will be particularly severe and

devastating in Canada. Temperatures in this country have risen by 1.7°C since 1948,

roughly double the global average rate of increase, and are expected to continue to rise

faster than that rate. Canada is also expected to continue to be affected by extreme

weather events like floods and forest fires, changes in precipitation levels, degradation

of soil and water resources, increased frequency and severity of heat waves, sea level

rise, and the spread of potentially life-threatening vector-borne diseases like Lyme

disease and West Nile virus.

[11]

The Canadian Arctic faces a disproportionately high risk from climate

change. There, the average temperature has increased at a rate of nearly three times the

global average, and that increase is causing significant reductions in sea ice, accelerated

permafrost thaw, the loss of glaciers and other ecosystem impacts. Canada’s coastline,

the longest in the world, is also being affected disproportionately by climate change, as

it experiences changes in relative sea level and rising water temperatures, as well as

increased ocean acidity and loss of sea ice and permafrost. Climate change has also had

a particularly serious effect on Indigenous peoples, threatening the ability of

Indigenous communities in Canada to sustain themselves and maintain their traditional

ways of life.

[12]

Climate change has three unique characteristics that are worth noting. First,

it has no boundaries; the entire country and entire world are experiencing and will

continue to experience its effects. Second, the effects of climate change do not have a

direct connection to the source of GHG emissions. Provinces and territories with low

GHG emissions can experience effects of climate change that are grossly

disproportionate to their individual contributions to Canada’s and the world’s total

GHG emissions. In 2016, for example, Alberta, Ontario, Quebec, Saskatchewan and

British Columbia accounted for approximately 90.5 percent of Canada’s total GHG

emissions, while the approximate percentages were 9.1 percent for the other five

provinces and 0.4 percent for the territories. Yet the effects of climate change are and

will continue to be experienced across Canada, with heightened impacts in the

Canadian Arctic, coastal regions and Indigenous territories. Third, no one province,

territory or country can address the issue of climate change on its own. Addressing

climate change requires collective national and international action. This is because the

harmful effects of GHGs are, by their very nature, not confined by borders.

B. Canada’s Efforts to Address Climate Change

[13]

Canada’s history of international commitments to address climate change

began in 1992 with its ratification of the United Nations Framework Convention on

Climate Change, U.N. Doc. A/AC.237/18 (Part II)/Add.1, May 15, 1992

(“UNFCCC”). After failing to meet its commitments under multiple UNFCCC

agreements, including the Kyoto Protocol, U.N. Doc. FCCC/CP/1997/L.7/Add.1,

December

10,

1997,

and

the

Copenhagen

Accord,

U.N.

Doc.

FCCC/CP/2009/11/Add.1, December 18, 2009, Canada agreed to the Paris Agreement

in 2015. Recognizing that “climate change represents an urgent and potentially

irreversible threat to human societies and the planet and thus requires the widest

possible cooperation by all countries”, the participating states agreed to hold the global

average temperature increase to well below 2.0°C above pre-industrial levels and to

pursue efforts to limit that increase to 1.5°C: United Nations, Framework Convention

on Climate Change, Report of the Conference of the Parties on its twenty-first session,

U.N. Doc. FCCC/CP/2015/10/Add.1, January 29, 2016, at p. 2; Paris Agreement, art.

2(1)(a). Canada ratified the Paris Agreement in 2016, and the agreement entered into

force that same year. Canada committed to reducing its GHG emissions by 30 percent

below 2005 levels by 2030.

[14]

Under the Paris Agreement, states are free to choose their preferred

approaches for meeting their nationally determined contributions. In Canada, the

provinces and the federal government agreed to work together in order to meet the

country’s international commitments. In March 2016, before Canada had ratified the

Paris Agreement, all the First Ministers met in Vancouver and adopted the Vancouver

Declaration on clean growth and climate change (“Vancouver Declaration”):

Canadian Intergovernmental Conference Secretariat, March 3, 2016 (online). In that

declaration, the First Ministers recognized the call in the Paris Agreement for

significant reductions in GHG emissions and committed to “[i]mplement[ing] GHG

mitigation policies in support of meeting or exceeding Canada’s 2030 target of a 30%

reduction below 2005 levels of emissions, including specific provincial and territorial

targets and objectives”: ibid, at p. 3. In the Vancouver Declaration, the First Ministers

also recognized the importance of a collaborative approach between provincial and

territorial governments and the federal government to reducing GHG emissions and

noted that “the federal government has committed to ensuring that the provinces and

territories have the flexibility to design their own policies to meet emission reductions

targets”: ibid.

[15]

The Vancouver Declaration resulted in the establishment of a federal-

provincial-territorial Working Group on Carbon Pricing Mechanisms (“Working

Group”) to study the role of carbon pricing mechanisms in meeting Canada’s emissions

reduction targets. The Working Group included at least one representative from each

provincial and territorial government as well as the federal government. Its final report

identified carbon pricing as one of the most efficient policy approaches for reducing

GHG emissions and outlined three carbon pricing options: (1) a single form broad-

based carbon pricing mechanism that would apply across Canada, an option that would

not be supportive of existing or planned provincial or territorial pricing policies; (2)

broad-based carbon pricing mechanisms across Canada, an option that would give each

province and territory flexibility as to the choice of instruments; and (3) a range of

broad-based carbon pricing mechanisms in some jurisdictions, while the remaining

jurisdictions would implement other mechanisms or policies designed to meet GHG

emissions reduction targets within their borders: Working Group on Carbon Pricing

Mechanisms, Final Report, 2016 (online), at pp. 1, 44-47 and 50.

[16]

Carbon pricing, or GHG pricing, is a regulatory mechanism that, in simple

terms, puts a price on GHG emissions in order to induce behavioural changes that will

lead to widespread reductions in emissions. By putting a price on GHG emissions,

governments can incentivize individuals and businesses to change their behaviour so

as to make more environmentally sustainable purchasing and consumption choices, to

redirect their financial investments, and to reduce their GHG emissions by substituting

carbon-intensive goods for low-GHG alternatives. Generally speaking, there are two

different approaches to GHG pricing: (1) a carbon tax that entails setting a price on

GHG emissions directly, but not setting a cap on emissions; and (2) a cap-and-trade

system that prices emissions indirectly by placing a cap on GHG emissions, allocating

emission permits to businesses and allowing businesses to buy and sell emission

permits from and to other businesses. A carbon tax sets an effective price per unit of

GHG emissions. In a cap-and-trade system, the market sets an effective price per unit

of GHG emissions, but a cap is placed on permitted emissions. Both approaches put a

price on GHG emissions. I also find it worthwhile to note that while “carbon tax” is the

term used among policy experts to describe GHG pricing approaches that directly price

GHG emissions, it has no connection to the concept of taxation as understood in the

constitutional context.

[17]

Building on the Working Group’s final report, the federal government

released the Pan-Canadian Approach to Pricing Carbon Pollution (“Pan-Canadian

Approach”) in October 2016: Environment and Climate Change Canada, October 3,

2016 (online). In it, the federal government introduced a pan-Canadian benchmark for

carbon pricing and stated the benchmark’s underlying principles, two of which were

that carbon pricing should be a central component of the pan-Canadian framework and

that the overall approach should be flexible and recognize carbon pricing policies

already being implemented or developed by provinces and territories. The Pan-

Canadian Approach also set out the criteria for the pan-Canadian benchmark that

would be used for determining acceptable minimum carbon pricing systems. Provinces

and territories would have the flexibility to implement, by 2018, one of two carbon

pricing systems with a common broad scope and legislated increases in stringency. A

federal backstop carbon pricing system would be implemented in jurisdictions that

either requested it or failed to implement a system that met the benchmark.

[18]

In December 2016, based on the Pan-Canadian Approach, the federal

government released the Pan-Canadian Framework on Clean Growth and Climate

Change (“Pan-Canadian Framework”): Environment and Climate Change Canada,

December 9, 2019 (online). In it, the federal government reaffirmed the principles

expounded in the Vancouver Declaration and the Pan-Canadian Approach, and

outlined in greater detail the criteria of the pan-Canadian benchmark for carbon pricing.

As in the Pan-Canadian Approach, the Pan-Canadian Framework required every

province and territory to have one of two carbon pricing systems in place by 2018: a

carbon tax or carbon levy system similar to the ones that had already been implemented

in British Columbia and Alberta, or a cap-and-trade system similar to the ones that had

been implemented in Ontario and Quebec. All carbon pricing systems had to have a

common broad scope and to increase in stringency over time. All revenues from the

carbon pricing system would remain in the jurisdiction of origin. A federal backstop

pricing system would apply only in jurisdictions that requested it, that had no carbon

pricing system or that had an insufficiently stringent carbon pricing system. All

revenues from the federal system would be returned to the jurisdiction of origin.

[19]

On the day the federal government released the Pan-Canadian

Framework, it was adopted by eight provinces, including Ontario and Alberta, and by

all three territories. Manitoba adopted the framework in February 2018, but

Saskatchewan has not done so yet. Later in 2018, Ontario, Alberta and Manitoba

withdrew their support from the Pan-Canadian Framework.

[20]

In May 2017, after the release of the Pan-Canadian Framework, the

federal government published the Technical Paper on the Federal Carbon Pricing

Backstop: Environment and Climate Change Canada, May 18, 2017 (online). This

paper provided further details, outlined the components of the proposed federal carbon

pricing system and sought feedback from stakeholders. The federal government then

published documents entitled Guidance on pan-Canadian carbon pollution pricing

benchmark, in August 2017, and Supplemental benchmark guidance, in December

2017, which further detailed the scope of the GHG emissions to which the carbon

pricing system would apply as well as the minimum legislated increases in stringency:

Environment and Climate Change Canada, Guidance on the pan-Canadian Carbon

pollution pricing benchmark, August 2017 (online); Environment and Climate Change

Canada, Supplemental benchmark guidance, December 20, 2017 (online).

[21]

On the day the Supplemental benchmark guidance document was released,

the federal Minister of Finance and Minister of Environment and Climate Change wrote

to their provincial and territorial counterparts to reaffirm Canada’s commitment to

carbon pricing under the Pan-Canadian Framework. The letter requested the provincial

and territorial ministers to explain how they would be implementing carbon pricing and

also outlined the next steps in the federal government’s process to price carbon.

[22]

In the context of this process, the GGPPA was introduced in Parliament as

Part 5 of Bill C-74, An Act to implement certain provisions of the budget, 1st Sess.,

42nd Parl., on March 27, 2018, and it received royal assent on June 21, 2018. In the

lead-up to the introduction of the GGPPA, the federal government had published

further guidance on the components of the proposed federal carbon pricing system.

C. Provincial Action on Climate Change

[23]

At the time the Pan-Canadian Framework was released, most of the

provinces and territories had already taken significant actions to address climate

change, including rehabilitating forests, developing low carbon fuels, capping

emissions for oil sands projects and the electricity sector, regulating methane

emissions, closing fossil-fuelled and coal-fired electricity generating stations, and

investing in renewable energy and transportation. British Columbia, Alberta, Ontario

and Quebec were the only provinces with carbon pricing systems. All the other

provinces and territories, except Saskatchewan and Manitoba, had indicated that they

planned to implement either a carbon tax or levy system or a cap-and-trade system.

[24]

Despite the actions that had been taken, Canada’s overall GHG emissions

had decreased by only 3.8 percent between 2005 and 2016, which was well below its

target of 30 percent by 2030. Over that period, GHG emissions had decreased in British

Columbia, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and

Yukon, but had increased in Alberta, Saskatchewan, Manitoba, Newfoundland and

Labrador, Northwest Territories and Nunavut. Illustrative of the collective action

problem of climate change, between 2005 and 2016, the decreases in GHG emissions

in Ontario, Canada’s second largest GHG emitting province, were mostly offset by

increases in emissions in two of Canada’s five largest emitting provinces, Alberta and

Saskatchewan. Canada’s remaining emissions reduction between 2005 and 2016 came

from two of Canada’s remaining five largest emitting provinces, Quebec and British

Columbia, as well as from decreases in GHG emissions of over 10 percent — well

above Canada’s 3.8 percent overall GHG emissions reduction — in New Brunswick,

Nova Scotia, Prince Edward Island and Yukon.

IV. The GGPPA

[25]

The GGPPA came into force on June 21, 2018.

A. Basic Architecture of the GGPPA

[26]

The GGPPA comprises four parts and four schedules. Part 1 of the GGPPA

establishes a fuel charge that applies to producers, distributors and importers of various

types of carbon-based fuel. Part 2 sets out a pricing mechanism for industrial GHG

emissions by large emissions-intensive industrial facilities. Part 3 authorizes the

Governor in Council to make regulations providing for the application of provincial

law concerning GHG emissions to federal works and undertakings, federal land and

Indigenous land located in that province, as well as to internal waters located in or

contiguous with the province. And Part 4 requires the Minister of the Environment to

prepare an annual report on the administration of the GGPPA and have it tabled in

Parliament. Only the first two parts and the four schedules are at issue in these appeals.

The parties do not challenge the constitutionality of Parts 3 and 4 of the GGPPA.

[27]

Because the GGPPA operates as a backstop, the GHG pricing mechanism

described in Parts 1 and 2 of the GGPPA does not automatically apply in all provinces

and territories. A province or territory will only be subject to Part 1 or 2 of the GGPPA

if the Governor in Council determines that its GHG pricing mechanism is insufficiently

stringent. However, the GGPPA itself always applies in the sense that provincial and

territorial GHG pricing mechanisms are always subject to assessment to ensure they

are sufficiently stringent. At the time of the hearing of these appeals, Ontario, New

Brunswick, Manitoba, Saskatchewan, Yukon and Nunavut were subject to both Parts

1 and 2 of the GGPPA. Alberta was subject only to Part 1, and Prince Edward Island

only to Part 2. After the hearing, the GGPPA was amended such that Part 1 no longer

applies to New Brunswick: Regulations Amending Part 1 of Schedule 1 and Schedule 2

to the Greenhouse Gas Pollution Pricing Act and the Fuel Charge Regulations,

SOR/2020-261. The federal government has also announced that Ontario will be

subject only to Part 1, but the GGPPA has not yet been amended to reflect this

announcement.

B. The Preamble

[28]

The GGPPA has a 16-paragraph preamble that sets out the background to

and purpose of the legislation. This preamble can helpfully be divided into five parts in

which the following points are articulated: (1) GHG emissions contribute to global

climate change, and that change is already affecting Canadians and poses a serious risk

to the environment, to human health and safety and to economic prosperity both in

Canada and internationally (at paras. 1-5); (2) Canada has committed internationally to

reducing its GHG emissions by ratifying the UNFCCC and the Paris Agreement (at

paras. 6-8); (3) it is recognized in the Pan-Canadian Framework that climate change

requires immediate action by the federal, provincial and territorial governments, and

GHG pricing is a core element of that framework (at paras. 9-10); (4) behavioural

change that leads to increased energy efficiency is necessary to take effective action

against climate change (at para. 11); and (5) the purpose of the GGPPA is to implement

stringent pricing mechanisms designed to reduce GHG emissions by creating

incentives for that behavioural change (paras. 12-16).

[29]

In the fifth part of the preamble, it is recognized that some provinces are

developing or have implemented GHG pricing systems: para. 14. However, it is also

acknowledged that the absence of such systems in some provinces and a lack of

stringency in some provincial pricing systems could contribute to significant harm to

the environment, to human health and safety and to economic prosperity: para. 15. The

preamble concludes with a statement that it is accordingly necessary to create a federal

GHG pricing system in order to ensure that GHG pricing applies broadly in Canada:

para. 16.

C. Part 1: Fuel Charge

[30]

Part 1 of the GGPPA establishes a charge on prescribed types of fuel that

applies to fuel produced, delivered or used in a listed province, fuel brought into a listed

province from another place in Canada and fuel imported into Canada at a location in

a listed province: ss. 17(1), 18(1), 19(1) and (2) and 21(1). Part 1 of Sch. 1 contains the

list of provinces to which Part 1 of the GGPPA applies. The fuel charge applies to 22

types of carbon-based fuel that release GHG emissions when burned, including

gasoline, diesel fuel and natural gas, as well as to combustible waste. Schedule 2 lists

the types of fuel to which the fuel charge applies and indicates the applicable rates of

charge for each one. Although the fuel charge is paid by fuel producers, distributors

and importers, and not directly by consumers, it is anticipated that retailers will pass

the fuel charge on to consumers in the form of higher energy prices. The fuel charge is

not payable on qualifying fuel delivered to farmers and fishers (s. 17(2)) or on fuel used

at prescribed facilities, including industrial facilities to which the pricing mechanism

in Part 2 of the GGPPA applies (ss. 3 and 18(4)). The fuel charge is administered by

the Minister of National Revenue acting through the Canada Revenue Agency.

[31]

Section 165 of the GGPPA concerns the distribution of the proceeds of the

fuel charge. Section 165(2) provides that the Minister of National Revenue must

distribute the amount collected in respect of the fuel charge in any listed province less

amounts that are rebated, refunded or remitted in respect of those charges, but that the

Minister of National Revenue has discretion whether to distribute the net amount to the

province itself, other prescribed persons or classes of persons or a combination of the

two. The federal government’s present policy is to give 90 percent of the proceeds of

the fuel charge directly to residents of the province of origin in the form of “Climate

Action Incentive” payments under the Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.),

as provided for in s. 13 of the Budget Implementation Act, 2018, No. 2, S.C. 2018, c. 27.

The Climate Action Incentive is a deemed rebate under the GGPPA that reduces the

amount that must be distributed under s. 165: Income Tax Act, s. 122.8(6). The

remaining 10 percent of the proceeds is paid out to schools, hospitals, colleges and

universities, municipalities, not-for-profit organizations, Indigenous communities and

small and medium-sized businesses in the province of origin. Simply put, the net

amount collected from a listed province is returned to persons and entities in that

province.

[32]

Part 1 of the GGPPA also provides the Governor in Council with

considerable power to make regulations. For example, s. 166 authorizes the Governor

in Council to make regulations to list or delist provinces in relation to the application

of the fuel charge under Part 1 of the GGPPA. Any such regulations must be made

“[f]or the purpose of ensuring that the pricing of greenhouse gas emissions is applied

broadly in Canada at levels that the Governor in Council considers appropriate”

(s. 166(2)), and the Governor in Council must, in making them, “take into account, as

the primary factor, the stringency of provincial pricing mechanisms for greenhouse gas

emissions” (s. 166(3)).

[33]

In addition, the Governor in Council is authorized to make regulations

prescribing anything that is to be prescribed or determined by regulation under Part 1:

s. 166(1)(a). Specifically, the Governor in Council can make regulations in relation to

the fuel charge system (s. 168(2)) by, for example, modifying the listed types of fuel

and the applicable rates of charge in Sch. 2 (ss. 166(4) and 168(3)(a)), or defining

words or expressions used in Part 1 of the GGPPA, in Part 1 of Sch. 1, or in Sch. 2

(s. 168(3)(a) and (b)). In the event of a conflict between a regulation and Part 1 of the

GGPPA, s. 168(4) provides that the regulation prevails to the extent of the conflict.

D. Part 2: Industrial Greenhouse Gas Emissions

[34]

Part 2 of the GGPPA establishes an output-based pricing system (“OBPS”)

for industrial GHG emissions by large emissions-intensive industrial facilities. The

OBPS applies only to a “covered facility” in a province listed in Part 2 of Sch. 1: ss. 169

and 174. Covered facilities include facilities that meet the criteria set out in the Output-

Based Pricing System Regulations, SOR/2019-266 (“OBPS Regulations”): GGPPA,

s. 169. Under the OBPS Regulations, a covered facility is one that meets a specified

emissions threshold and is engaged in specific industrial activities: s. 8. The Minister

of the Environment may also, upon request, designate an industrial facility located in a

backstop jurisdiction (i.e., one listed in Part 2 of Sch. 1) as a covered facility even if it

does not meet the criteria in the regulations: GGPPA, s. 172. A covered facility is

exempt from the fuel charge (ss. 18(3) and 18(4)), but it must pay for any GHG

emissions that exceed its applicable emissions limits on the basis of sector-specific

output-based standards. This can be done in one of three ways: (1) by remitting surplus

compliance units earned by the facility at a time when its GHG emissions were below

its annual limit, or surplus credits purchased from other facilities; (2) paying an excess

emissions charge; or (3) a combination of the two (ss. 174(1) and (2) and 175). The

OBPS Regulations require that a covered facility’s emissions limit be generally

calculated on the basis of the facility’s production from each industrial activity and an

output-based emissions standard in respect of that activity expressed in units of

emissions per unit of product: s. 36; Sch. 1. If the efficiency of a facility’s industrial

processes meets the applicable efficiency standards, the facility will not exceed its

emissions limit. It is only where an industrial process is not sufficiently efficient in

terms of its production per unit of emissions that a person responsible for a covered

facility must provide compensation for the facility’s excess emissions. A facility whose

efficiency exceeds the standards earns surplus credits: GGPPA, s. 175. Schedule 3 lists

33 GHGs and sets out the global warming potential of each one as defined in

accordance with the OBPS, while Sch. 4 sets out the charges for excess emissions. The

OBPS is administered by the Minister of the Environment.

[35]

Section 188 of the GGPPA, which concerns the distribution of revenues

from excess emission charge payments, works similarly to s. 165 of Part 1.

Section 188(1) provides that the Minister of National Revenue must distribute all

revenues from excess emissions charge payments, but that the Minister has discretion

whether to distribute them to the province itself, to persons specified in the regulations

or that meet criteria set out in the regulations, or to a combination of both. The federal

government has indicated that these revenues will be used to support carbon pollution

reduction in the jurisdictions in which they were collected, but has not yet provided

further details.

[36]

Part 2 of the GGPPA — like Part 1 — also provides the Governor in

Council with considerable power to make regulations and orders. For example, s. 189

authorizes the Governor in Council to make orders to list or delist provinces in relation

to the application of the OBPS in Part 2 of the GGPPA. As with s. 166, any such order

must be made “[f]or the purpose of ensuring that the pricing of greenhouse gas

emissions is applied broadly in Canada at levels that the Governor in Council considers

appropriate” (s. 189(1)), and the Governor in Council must, in making it, “take into

account, as the primary factor, the stringency of provincial pricing mechanisms for

greenhouse gas emissions” (s. 189(2)).

[37]

As well, the Governor in Council is authorized to make orders adding

GHGs to, or deleting them from, Sch. 3 or amending the global warming potential of

any gas; in doing so, the Governor in Council may take into account any factor it

considers appropriate: ss. 190(1) and (2). The Governor in Council also has the

authority to amend Sch. 4 by amending an excess emissions charge or by adding

calendar years: s. 191. Finally, the Governor in Council is authorized to make

regulations pertaining to a number of aspects of the OBPS, including covered facilities,

GHG emissions limits, the quantification of GHGs, the circumstances under which

GHGs are deemed to have been emitted by a facility, compensation, and permitted

transfers of compliance units: s. 192.

[38]

It is important to understand that Parts 1 and 2 of the GGPPA together

create a single GHG pricing scheme. Part 1 of the GGPPA directly prices GHG

emissions. The OBPS created by the OBPS Regulations made under Part 2 of the

GGPPA constitutes a complex exemption to Part 1. The OBPS exempts covered

facilities from the blunt fuel charge under Part 1, creating a more tailored GHG pricing

scheme that lowers the effective GHG price such facilities would otherwise have to pay

under Part 1. Part 2 thus also directly prices GHG emissions, but only to the extent that

covered facilities exceed applicable efficiency standards. Parts 1 and 2 of the GGPPA

therefore function together to price GHG emissions throughout the Canadian economy.

V. Judicial History

A. Court of Appeal for Saskatchewan, 2019 SKCA 40, 440 D.L.R. (4th) 398

[39]

The majority of the Court of Appeal for Saskatchewan (Richards C.J.S.,

Jackson and Schwann JJ.A.) concluded that the GGPPA is intra vires Parliament on

the basis of the national concern doctrine. The majority identified the pith and

substance of the GGPPA as “the establishment of minimum national standards of price

stringency for GHG emissions”: para. 125. Applying the framework from R. v. Crown

Zellerbach Canada Ltd., [1988] 1 S.C.R. 401, they found that the establishment of

minimum national standards of price stringency for GHG emissions is a matter of

national concern. This matter is of genuine national importance and has the requisite

singleness, distinctiveness and indivisibility. GHGs are readily identifiable and

distinguishable from other gases, and minimum pricing standards are distinguishable

from other forms of regulation. Each province is vulnerable to another province’s

failure to adequately price GHG emissions. Interprovincial cooperation could not be a

basis for a sustainable approach to minimum GHG pricing, because provinces are free

to withdraw from cooperative arrangements. As well, recognizing federal authority

over minimum national standards of price stringency for GHG emissions would have

an acceptable impact on provincial jurisdiction, because it would limit Parliament’s

role to pricing and would not threaten the constitutional validity of provincial initiatives

to regulate GHGs.

[40]

Ottenbreit and Caldwell JJ.A. dissented. They concluded that Part 1 of the

GGPPA is the result of an unconstitutional exercise of Parliament’s taxation power and

that the GGPPA as a whole is ultra vires Parliament. GHG emissions do not represent

a constitutionally distinct matter, and the concepts of “stringency” and “national

standards” should not be used to tease an abstraction out of recognizable matters within

provincial jurisdiction. The asserted need for a national standard of stringency is based

not on a genuine provincial inability to set such a standard, but simply on a policy

dispute. Finally, the dissent concluded that the matter’s scale of impact on provincial

jurisdiction is not reconcilable with the balance of federalism. The GGPPA would

deprive provinces of the ability to regulate GHGs within their borders. Furthermore, it

would be possible for the power delegated to the executive branch by the GGPPA to

be exercised so as to widen the scope of the statute, thus further eroding provincial

authority.

B. Court of Appeal for Ontario, 2019 ONCA 544, 146 O.R. (3d) 65

[41]

The majority of the Court of Appeal for Ontario (Strathy C.J.O.,

MacPherson and Sharpe JJ.A.) concluded that the GGPPA is intra vires Parliament on

the basis of the national concern doctrine. The majority characterized the pith and

substance of the GGPPA as “establishing minimum national standards to reduce

greenhouse gas emissions”: para. 77. Applying the framework from Crown Zellerbach,

they reasoned that this matter is new as it was not recognized at Confederation. It is a

matter of national concern, as evidenced by the GGPPA’s relationship to Canada’s

international obligations and by the fact that the statute was the product of extensive

efforts to achieve a national response to climate change. The matter meets the

singleness, distinctiveness and indivisibility requirement. GHGs are a chemically

distinct form of pollution with international and interprovincial impacts. The provinces

cannot establish minimum national standards to reduce GHG emissions. No province

can control the deleterious effects of GHGs emitted in other provinces or require other

provinces to take steps to do so. In assessing the matter’s scale of impact on provincial

jurisdiction, the majority found that the GGPPA strikes an appropriate balance between

Parliament and the provincial legislatures. Finally, the majority rejected the Attorney

General of Ontario’s argument that the levies imposed by the GGPPA are

unconstitutional regulatory charges. The majority found the levies to be valid because

they have a sufficient connection to the regulatory scheme based on their purpose of

behaviour modification.

[42]

Hoy A.C.J.O. concurred with Strathy C.J.O.’s national concern analysis,

although she characterized the pith and substance of the GGPPA more narrowly as

“establishing minimum national greenhouse gas emissions pricing standards to reduce

greenhouse gas emissions”: paras. 165-66 (emphasis added). In her view, including the

means — carbon pricing — in the description of the pith and substance is legally

permissible and desirable. In some cases, as here, Parliament’s choice of means may

be so central to the legislative objective that the main thrust of the law, properly

understood, is to achieve a result in a particular way.

[43]

Huscroft J.A. dissented. He characterized the pith and substance of the

GGPPA broadly as the regulation of GHG emissions. At the classification stage, he

reasoned that the national concern doctrine requires the identification of a new subject

matter that is independent of the means adopted in the relevant law. In this case, the

proposed matter of national concern is federal authority over GHG emissions, which

fails to meet the singleness, distinctiveness and indivisibility requirement from Crown

Zellerbach. In addition, recognizing federal jurisdiction on the basis of provincial

inability to establish a national standard would allow any matter to be transformed into

a matter of national concern by just adding the word “national” to it. The fact that one

province’s inaction could undermine another province’s carbon pricing efforts does not

establish provincial inability either; this simply reflects a legitimate policy

disagreement. Finally, Huscroft J.A. concluded that the matter’s scale of impact on

provincial jurisdiction is incompatible with the federal-provincial division of powers.

For a matter to be one of national concern, it must have ascertainable and reasonable

limits in order to contain its reach.

C. Court of Appeal of Alberta, 2020 ABCA 74, 3 Alta. L.R. (7th) 1

[44]

The majority of the Court of Appeal of Alberta (Fraser C.J.A., Watson and

Hughes JJ.A.) held that the GGPPA is unconstitutional. They reasoned that the national

concern doctrine can apply only to matters that would originally have fallen within the

provincial power respecting matters of a merely local or private nature under s. 92(16)

of the Constitution. The doctrine has no application to matters that would originally

have fallen under other enumerated provincial heads of power. The majority

characterized the pith and substance of the GGPPA as “at a minimum, regulation of

GHG emissions”: paras. 211 and 256. This subject falls under various enumerated

provincial powers, and in particular the power relating to the development and

management of natural resources under s. 92A of the Constitution. Accordingly, the

majority reasoned, the national concern doctrine has no application in this case. The

majority went on to apply the framework from Crown Zellerbach. They found that the

regulation of GHG emissions is not a single, distinctive and indivisible matter and that

it would have an unacceptable impact on provincial jurisdiction. The GGPPA intrudes

significantly into the provinces’ exclusive jurisdiction over the development and

management of natural resources, thereby depriving provinces of their right to balance

environmental concerns with economic sustainability.

[45]

Wakeling J.A., writing separately, questioned the need for the national

concern doctrine and proposed a significant reformulation of the Crown Zellerbach

framework. He concluded that the GGPPA is ultra vires Parliament. Canada was in

fact seeking judicial approbation of the “environment” or “climate change” as a new

federal head of power. Recognition of such a broad federal power would fundamentally

destabilize Canadian federalism. The provinces are already taking action to reduce

GHG emissions, and the country is better served when governments at both levels work

to reduce GHG emissions within their own areas of jurisdiction.

[46]

Feehan J.A., dissenting, found that the GGPPA is valid on the basis of the

national concern doctrine. He identified the pith and substance of the law as follows:

“To effect behavioural change throughout Canada leading to increased energy

efficiencies by the use of minimum national standards necessary and integral to the

stringent pricing of greenhouse gas emissions” (para. 1056). He found that this is a new

matter or a matter of national concern, and that it is single, distinctive and indivisible.

The GGPPA has a small scale of impact on provincial jurisdiction, since it

accommodates existing provincial systems and is designed merely to set minimum

national standards in order to ensure equity as between provinces. The provincial

inability test is also met, given that one province’s failure to address GHG emissions

would have an adverse effect on other provinces.

VI. Analysis

[47]

Alberta, Ontario and Saskatchewan challenge the constitutionality of the

GGPPA on federalism-related grounds. Ontario further argues that the levies imposed

by the GGPPA are unconstitutional. Canada and British Columbia argue that the

GGPPA is constitutional on the basis of the national concern doctrine. Below, I will

begin by briefly discussing the foundational principle of federalism. I will then

undertake the well-established two-stage analytical approach to the review of

legislation on federalism grounds: Reference re Pan-Canadian Securities Regulation,

2018 SCC 48, [2018] 3 S.C.R. 189 (“2018 Securities Reference”), at para. 86. I will

first consider the purpose and effects of the GGPPA with a view to characterizing the

subject matter — the pith and substance — of the statute. Then I will classify the subject

matter of the GGPPA with reference to federal and provincial heads of power under

the Constitution in order to determine whether it is intra vires Parliament and therefore

valid. Finally, independently of the jurisdiction issue, I will consider the

constitutionality of the levies imposed by the GGPPA.

A. Principle of Federalism

[48]

Federalism is a foundational principle of the Canadian Constitution. It was

a legal response to the underlying political and cultural realities that existed at

Confederation, and its objectives are to reconcile diversity with unity, promote

democratic participation by reserving meaningful powers to the local or regional level

and foster cooperation between Parliament and the provincial legislatures for the

common good: Reference re Secession of Quebec, [1998] 2 S.C.R. 217 (“Secession

Reference”), at para. 43; Canadian Western Bank v. Alberta, 2007 SCC 22, [2007] 2

S.C.R. 3, at para. 22.

[49]

Sections 91 and 92 of the Constitution give expression to the principle of

federalism and divide legislative powers between Parliament and the provincial

legislatures: Reference re Securities Act, 2011 SCC 66, [2011] 3 S.C.R. 837 (“2011

Securities Reference”), at para. 54. Under the division of powers, broad powers were

conferred on the provinces to ensure diversity, while at the same time reserving to the

federal government powers better exercised in relation to the country as a whole to

provide for Canada’s unity: Canadian Western Bank, at para. 22. Importantly, the

principle of federalism is based on a recognition that within their spheres of

jurisdiction, provinces have autonomy to develop their societies, such as through the

exercise of the significant provincial power in relation to “Property and Civil Rights”

under s. 92(13). Federal power cannot be used in a manner that effectively eviscerates

provincial power: Secession Reference, at para. 58; 2011 Securities Reference, at para.

7. A view of federalism that disregards regional autonomy is in fact as problematic as

one that underestimates the scope of Parliament’s jurisdiction: R. v. Comeau, 2018 SCC

15, [2018] 1 S.C.R. 342, at para. 82.

[50]

As this Court observed in Reference re Remuneration of Judges of the

Provincial Court of Prince Edward Island, [1997] 3 S.C.R. 3, at para. 124, courts, as

impartial arbiters, are charged with resolving jurisdictional disputes over the

boundaries of federal and provincial powers on the basis of the principle of federalism.

Although early Canadian constitutional decisions by the Judicial Committee of the

Privy Council applied a rigid division of federal-provincial powers as watertight

compartments, this Court has favoured a flexible view of federalism — what is best

described as a modern form of cooperative federalism — that accommodates and

encourages intergovernmental cooperation: 2011 Securities Reference, paras. 56-58.

That being said, the Court has always maintained that flexibility and cooperation, while

important to federalism, cannot override or modify the constitutional division of

powers. As the Court remarked in 2011 Securities Reference, “[t]he ‘dominant tide’ of

flexible federalism, however strong its pull may be, cannot sweep designated powers

out to sea, nor erode the constitutional balance inherent in the Canadian federal state”:

para. 62. It is in light of this conception of federalism that I approach this case.

B. Characterization of the GGPPA

(1) Overarching Principles

[51]

At the first stage of the division of powers analysis, a court must consider

the purpose and effects of the challenged statute or provision in order to identify its

“pith and substance”, or true subject matter: 2018 Securities Reference, at para. 86;

Reference re Genetic Non-Discrimination Act, 2020 SCC 17, at paras. 28 and 166. The

court does so with a view to identifying the statute’s or provision’s main thrust, or

dominant or most important characteristic: Desgagnés Transport Inc. v. Wärtsilä

Canada Inc., 2019 SCC 58, at para. 31. To determine the purpose of the challenged

statute or provision, the court can consider both intrinsic evidence, such as the

legislation’s preamble or purpose clauses, and extrinsic evidence, such as Hansard or

minutes of parliamentary committees: Kitkatla Band v. British Columbia (Minister of

Small Business, Tourism and Culture), 2002 SCC 31, [2002] 2 S.C.R. 146, at para. 53;

Canadian Western Bank, at para. 27. In considering the effects of the challenged

legislation, the court can consider both the legal effects, those that flow directly from

the provisions of the statute itself, and the practical effects, the “side” effects that flow

from the application of the statute: Kitkatla, at para. 54; R. v. Morgentaler, [1993] 3

S.C.R. 463, at p. 480. The characterization process is not technical or formalistic. A

court can look at the background and circumstances of a statute’s enactment as well as

at the words used in it: Ward v. Canada (Attorney General), 2002 SCC 17, [2002] 1

S.C.R. 569, at para. 18.

[52]

Three further points with respect to the identification of the pith and

substance are important here. First, the pith and substance of a challenged statute or

provision must be described as precisely as possible. A vague or general description is

unhelpful, as it can result in the law being superficially assigned to both federal and

provincial heads of powers or may exaggerate the extent to which the law extends into

the other level of government’s sphere of jurisdiction: Desgagnés Transport, at

para. 35; Reference re Assisted Human Reproduction Act, 2010 SCC 61, [2010] 3

S.C.R. 457 (“Assisted Human Reproduction Act”), at para. 190. However, precision

should not be confused with narrowness. Instead, the pith and substance of a challenged

statute or provision should capture the law’s essential character in terms that are as

precise as the law will allow: Genetic Non-Discrimination, at para. 32. It is only in this

manner that a court can determine what the law is in fact “all about”: Desgagnés

Transport, at para. 35, quoting A. S. Abel, “The Neglected Logic of 91 and 92” (1969),

19 U.T.L.J. 487, at p. 490.

[53]

Second, it is permissible in some circumstances for a court to include the

legislative choice of means in the definition of a statute’s pith and substance, as long

as it does not lose sight of the fact that the goal of the analysis is to identify the true

subject matter of the challenged statute or provision. In the courts below, a central issue

was the permissibility of including the means of the statute in the definition of the

subject matter of the GGPPA. In Ward and other cases, this Court cautioned against

“confus[ing] the purpose of the legislation with the means used to carry out that

purpose”: Ward, at para. 25; see also Quebec (Attorney General) v. Canada (Attorney

General), 2015 SCC 14, [2015] 1 S.C.R. 693, at para. 29; Goodwin v. British Columbia

(Superintendent of Motor Vehicles), 2015 SCC 46, [2015] 3 S.C.R. 250, at para. 24.

However, those cases did not establish a blanket prohibition on considering the means

in characterizing the pith and substance of a law. Rather, they stand for the basic

proposition that Parliament’s or a provincial legislature’s choice of means is not

determinative of the legislation’s true subject matter, although it may sometimes be

permissible to consider the choice of means in defining a statute’s purpose. This Court

has in fact frequently included references to legislative means when defining the pith

and substance of laws: Ward, at para. 28; Reference re Firearms Act (Can.), 2000 SCC

31, [2000] 1 S.C.R. 783 (“Firearms”), at paras. 4 and 19; Reference re Employment

Insurance Act (Can.), ss. 22 and 23, 2005 SCC 56, [2002] 2 S.C.R. 669, at para. 34;

2011 Securities Reference, at para. 106. And there may be cases in which an impugned

statute’s dominant characteristic or main thrust is so closely tied to its means that

treating the means as irrelevant to the identification of the pith and substance would

make it difficult to define the matter of a statute or a provision precisely. In such a case,

a broad pith and substance that does not include the means would be the very type of

vague and general characterization, like “health” or “the environment”, that this Court

described as unhelpful in Desgagnés Transport, at paras. 35 and 167 (citing Assisted

Human Reproduction Act, at para. 190).

[54]

Even this Court’s jurisprudence on the national concern doctrine illustrates

that there is nothing impermissible about defining a matter with reference to the

legislative means. In Munro v. National Capital Commission, [1966] S.C.R. 663, the

Court defined the matter in terms of both the overarching objective — ensuring that

“the nature and character of the seat of the Government of Canada may be in

accordance with its national significance” — and the legislative means for achieving

this objective — “development, conservation and improvement of the National Capital

Region”: pp. 669 and 671. Similarly, in Crown Zellerbach, the Court did not define the

matter of the statute broadly in terms of marine pollution. The definition of the matter

was in fact a combination of the overarching purpose — controlling marine pollution

— and the particular means that had been chosen — controlling the dumping of

substances into the sea: pp. 436-37. La Forest J., dissenting, pointed out that regulating

the dumping of substances into the sea was only one of multiple means to control

marine pollution, given that pollution could also enter the sea through fresh water and

through the air: p. 457.

[55]

I therefore agree with Hoy A.C.J.O.’s statement in the case at bar that in

some cases the choice of means may be so central to the legislative objective that the

main thrust of a statute or provision, properly understood, is to achieve a result in a

particular way, which would justify including the means in identifying the pith and

substance: para. 179.

[56]

Third, the characterization and classification stages of the division of

powers analysis are and must be kept distinct. In other words, the pith and substance of

a statute or a provision must be identified without regard to the heads of legislative

competence. As Binnie J. noted in Chatterjee v. Ontario (Attorney General), 2009 SCC

19, [2009] 1 S.C.R. 624, at para. 16, a failure to keep these two stages of the analysis

distinct would create “a danger that the whole exercise will become blurred and overly

oriented towards results”. The characterization exercise must ultimately be rooted in

the purpose and the effects of the impugned statute or provision.

(2) Application to the GGPPA

[57]

In this case, the judges in the courts below, the parties and the interveners

have proposed various formulations of the GGPPA’s pith and substance. These

formulations can be grouped in three basic categories: (1) a broad formulation to the

effect that the GGPPA’s pith and substance is the regulation of GHG emissions; (2) a

national standards-based formulation to the effect that the GGPPA’s pith and substance

is to establish minimum national standards to reduce GHG emissions; and (3) a national

standards pricing-based formulation to the effect that the GGPPA’s pith and substance

is to establish minimum national standards of GHG price stringency to reduce GHG

emissions. I would adopt a national standards pricing-based formulation of the pith and

substance of the GGPPA. In my view, the true subject matter of the GGPPA is

establishing minimum national standards of GHG price stringency to reduce GHG

emissions. Allow me to explain why.

(a) Intrinsic Evidence

[58]

This Court has frequently used a statute’s title as a tool for the purposes of

characterization: Re: Exported Natural Gas Tax, [1982] 1 S.C.R. 1004, at p. 1077; R.

v. Swain, [1991] 1 S.C.R. 933, at p. 1004; Siemens v. Manitoba (Attorney General),

2003 SCC 3, [2003] 1 S.C.R. 6, at para. 21. However, a statute’s title is not

determinative in the pith and substance analysis: Re: Anti-Inflation Act, [1976] 2 S.C.R.

373, at p. 451. In the case at bar, the statute is titled “Greenhouse Gas Pollution Pricing

Act”. Its long title is “An Act to mitigate climate change through the pan-Canadian

application of pricing mechanisms to a broad set of greenhouse gas emission sources

and to make consequential amendments to other Acts”. Both of these titles confirm that

the purpose of the GGPPA is more precise than the regulation of GHG emissions. As

the long title makes clear, the true subject matter of the GGPPA is not just “to mitigate

climate change”, but to do so “through the pan-Canadian application of pricing

mechanisms to a broad set of greenhouse gas emission sources”. The short title also

makes it clear that the GGPPA is concerned not simply with regulating GHG emissions,

but with pricing them, as the statute is titled the “Greenhouse Gas Pollution Pricing

Act”. Just as Lamer C.J. found in Swain, it is in the instant case clear even from the title

of the GGPPA that its main thrust is national GHG pricing, not, more broadly, the

reduction of GHG emissions.

[59]

Likewise, the preamble of the GGPPA confirms that its subject matter is

national GHG pricing. In general, preambles are useful in constitutional litigation in

order to illustrate the “mischief” the legislation is designed to cure and the goals

Parliament sought to achieve: R. Sullivan, Sullivan on the Construction of Statutes (6th

ed. 2014), at § 14.25; P. W. Hogg, Constitutional Law of Canada (5th ed. Supp. (loose-

leaf)), vol. 1, at pp. 15-14 to 15-15. Although a preamble is not conclusive or

determinative, it can be a useful tool in interpreting the purpose of a statute or a

provision.

[60]

It is clear from reading the preamble as a whole that the focus of the

GGPPA is on national GHG pricing. The preamble begins with a review of the

contribution of GHG emissions to global climate change, of the impact of climate

change on — and the risks it poses to — Canada and Canadians (at paras. 1-5), and of

the international commitments made by Canada in the UNFCCC and the Paris

Agreement to reduce GHG emissions (paras. 6-8). It then focuses on establishing a

minimum national standards GHG pricing scheme. It identifies GHG pricing as “a core

element” of the Pan-Canadian Framework (at para. 10), and recognizes that climate

change requires immediate collective action to promote behavioural change which

leads to increased energy efficiency (paras. 9 and 11). After that, pricing mechanisms

are commented on at length (at paras. 12-16): in particular, it is noted that some

provinces are developing or have implemented GHG pricing systems (at para. 14), but

that the absence of such systems or a lack of stringency in some provincial GHG pricing

systems could contribute to significant harm to the environment and to human health

(para. 15). The preamble concludes with a statement that a national GHG pricing

scheme is accordingly necessary in order to ensure that, taking provincial pricing

systems into account, “greenhouse gas emissions pricing applies broadly in Canada”:

para. 16.

[61]

Furthermore, the “mischief” the GGPPA is intended to address is clearly

identified in the preamble: the profound nationwide harm associated with a purely

intraprovincial approach to regulating GHG emissions. In Firearms, the Court stated

that the mischief approach — one in which a court considers the problem a statute is

intended to address — is one way to determine the purpose of impugned legislation:

para. 21. In the instant case, the preamble shows that the law is intended to address the

“significant deleterious effects on the environment, including its biological diversity,

on human health and safety and on economic prosperity” that could result from “the

absence of greenhouse gas emissions pricing in some provinces and a lack of stringency

in some provincial greenhouse gas emissions pricing systems”: para. 15. In

Parliament’s eyes, the relevant mischief is not GHG emissions generally, but rather the

effects of the failure of some provinces to implement GHG pricing systems or to

implement sufficiently stringent pricing systems, and the consequential failure to

reduce GHG emissions across Canada. To address this mischief, the GGPPA

establishes minimum national standards for GHG pricing that apply across Canada,

setting a GHG pricing “floor” across the country.

(b) Extrinsic Evidence

[62]

In considering extrinsic evidence, a court may consider the statute’s

legislative history — the events leading up to its enactment, for example, as well as

government policy papers and legislative debates — in order to determine what the

legislative purpose is: Hogg, at pp. 15-14 to 15-15; Kitkatla, at para. 53. In the case at

bar, the extrinsic evidence confirms that the main thrust of the GGPPA is establishing

minimum national standards of GHG price stringency to reduce GHG emissions.

[63]

First, it can be seen from the events leading up to the enactment of the

GGPPA and from government policy papers that there was a focus on GHG pricing

and establishing a national GHG pricing benchmark, and that GHG pricing is a distinct

portion of the field of governmental responses to climate change. In the Paris

Agreement, states made general international commitments to reduce GHG emissions.

They are not required to adopt GHG pricing systems; rather, they are free to choose

their preferred means. Immediately after the adoption of the Paris Agreement, however,

the First Ministers endorsed the Vancouver Declaration, in which they recognized that

governments in Canada and around the world were using carbon pricing mechanisms

to combat climate change, and Canada and the provinces committed to adopting “a

broad range of domestic measures, including carbon pricing mechanisms” in order to

reduce GHG emissions: at p. 3 (emphasis added). Moreover, the signers of the

Vancouver Declaration clearly recognized carbon pricing as a distinct aspect of the

field of governmental responses to climate change by establishing a working group on

carbon pricing mechanisms that was independent of other working groups on clean

technology, innovation and jobs, on specific opportunities for mitigation of climate

change, and on adaptation to climate change and climate resilience.

[64]

The Working Group on Carbon Pricing Mechanisms was established to

explore the role of carbon pricing mechanisms in meeting Canada’s GHG emissions

reduction targets under the Paris Agreement. In its final report, the Working Group

identified carbon pricing as one of the most efficient policy approaches for reducing

GHG emissions and advocated for broad-based carbon pricing mechanisms across

Canada that would give each province and territory flexibility on instrument choice.

The federal government then endorsed this recommendation in both the Pan-Canadian

Approach and the Pan-Canadian Framework, and the Pan-Canadian Approach

introduced a federal benchmark for carbon pricing. Each province and territory would

have flexibility to implement either a direct or an indirect carbon pricing system that

would have a common scope to ensure effectiveness and minimize interprovincial

competitiveness impacts, while a federal backstop, a direct carbon pricing system,

would apply only in jurisdictions that did not meet the federal benchmark. This

approach would ensure that GHG pricing would be applied across the Canadian

economy, and it would recognize GHG pricing policies already implemented or being

developed by provinces or territories. The Pan-Canadian Framework reaffirmed the

Pan-Canadian Approach and outlined the federal benchmark for carbon pricing in

greater detail. In the Pan-Canadian Framework, the federal government reiterated the

need for a regulatory framework for carbon pricing that priced GHG emissions across

the Canadian economy, highlighted the federal commitment to “ensuring that the

provinces and territories have the flexibility to design their own policies and programs

to meet emission-reductions targets” and stated that the purpose of the federal

benchmark was to preserve the flexibility of the provinces and territories to design their

own GHG pricing policies: Foreword and pp. 7-8. Each province or territory would

have flexibility to implement a direct or indirect GHG pricing system within its borders.

A federal direct GHG pricing backstop would apply in jurisdictions that did not meet

the benchmark.

[65]

In my view, it is clear from the Working Group’s final report, the Pan-

Canadian Approach and the Pan-Canadian Framework that the federal government’s

intention was not to take over the field of regulating GHG emissions, or even that of

GHG pricing, but was, rather, to establish minimum national standards of GHG price

stringency for GHG emissions — through a federally imposed national direct GHG

pricing backstop — without displacing provincial and territorial jurisdiction over the

choice and design of pricing instruments. Courts should generally hesitate to attribute

to Parliament an intention to occupy an entire field: Saskatchewan (Attorney General)

v. Lemare Lake Logging Ltd., 2015 SCC 53, [2015] 3 S.C.R. 419, at para. 20. In the

instant case, this statement rings all the more true because the extrinsic evidence of the

lead-up to the enactment of the GGPPA reveals a process of federal-provincial-

territorial cooperation in which the federal government’s goal was a system where the

provincial and territorial governments would be free to design and implement their own

GHG pricing programs.

[66]

Second, it can also be seen from the legislative debates leading up to the

GGPPA that the focus of the statute was not broadly on regulating GHG emissions or

establishing minimum national standards to reduce GHG emissions, but was, rather, on

establishing minimum national standards of GHG price stringency. During the

parliamentary debate on the GGPPA, the then Minister of Environment and Climate

Change, the Hon. Catherine McKenna, indicated that pricing carbon pollution was

“[c]entral to any credible climate plan” and was “a major contribut[or] to helping

Canada meet its climate targets under the Paris Agreement”: House of Commons

Debates, vol. 148, No. 289, 1st Sess., 42nd Parl., May 1, 2018, at p. 18958. The then

Parliamentary Secretary to the Minister of the Environment and Climate Change,

Jonathan Wilkinson, echoed these comments. He observed that, “[t]o ensure that a

national pollution pricing system can be implemented across the country, the

government promised to set a regulated federal floor price on carbon”: House of

Commons Debates, vol. 148, No. 294, 1st Sess., 42nd Parl., May 8, 2018, at p. 19213

(emphasis added). What is more, he identified carbon pricing as a distinct part of the

field of governmental responses to climate change, stating that “the focus of the pricing

of carbon pollution is to actually incent choices that drive people toward more efficient

use of hydrocarbon resources so that we will reduce our GHG emissions over time. It

is an important piece of a broader approach to addressing climate change and to

achieving our Paris targets”: p. 19214 (emphasis added).

[67]

Similarly, before the House of Commons Standing Committee on Finance,

Judy Meltzer, the then Director General, Carbon Pricing Bureau, Department of the

Environment, observed that the GGPPA was “a step in the development of a federal

carbon pricing backstop system” and that “[t]he key purpose of the [GGPPA] is to help

reduce [GHG] emissions by ensuring that a carbon price applies broadly throughout

Canada, with increasing stringency over time”: House of Commons, Standing

Committee on Finance, Evidence, No. 146, 1st Sess., 42nd Parl., April 25, 2018, at p. 6

(emphasis added). And finally, before the same Standing Committee, John Moffet, the

then Associate Assistant Deputy Minister, Environmental Protection Branch,

Department of the Environment, expressed the opinion that “the government’s goal

was to ensure that carbon pricing applied throughout Canada” as well as “to send a

signal to other countries and businesses planning to invest in Canada that Canada was

committed to carbon pricing”: House of Commons, Standing Committee on Finance,

Evidence, No. 148, 1st Sess., 42nd Parl., May 1, 2018, at p. 5 (emphasis added). He

also mentioned another goal of the GGPPA, that is, to “make a contribution, but not be

the sole contributor to attaining the [Paris] target”: House of Commons, Standing

Committee on Finance, Evidence, No. 152, 1st Sess., 42nd Parl., May 8, 2018, at p. 8.

[68]

Although statements made in the course of parliamentary debates should

be viewed with caution, given that the purpose of the statute is that of Parliament, not

that of its individual members, such statements can nonetheless be helpful in discerning

Parliament’s purpose: Genetic Non-Discrimination, at paras. 40 and 194; Attorney-

General for Alberta v. Attorney-General for Canada, [1939] A.C. 117 (P.C.), at p. 131;

Canadian National Railway Co. v. Canada (Attorney General), 2014 SCC 40, [2014]

2 S.C.R. 135, at para. 47. In the case at bar, it is notable that both elected representatives

and senior public servants consistently described the purpose of the GGPPA in terms

of imposing a Canada-wide GHG pricing system, not of regulating GHG emissions

generally.

[69]

As an aside, I note that in finding that the GGPPA is ultra vires Parliament,

the majority of the Court of Appeal of Alberta did not deny that Parliament was

concerned with setting a minimum national GHG pricing standard in enacting the

legislation. But they found that Parliament’s focus on GHG pricing was merely a means

to achieve its ultimate purpose of reducing GHG emissions and mitigating the effects

of climate change: paras. 213-14. As I explained above, however, a court should

characterize the pith and substance — including the purpose being pursued by

Parliament or the provincial legislature — precisely. The fact that Parliament’s purpose

can be stated at multiple levels of generality does not mean that the most general

purpose is the true one, or the one that most accurately reflects the thrust of the

legislation. This Court has in fact often declined to attribute the broadest possible

purpose to Parliament: see R. v. Hydro-Québec, [1997] 3 S.C.R. 213, at para. 130.

When characterizing a matter, a court must strive to be as precise as possible, because

a precise statement more accurately reflects the true nature of what Parliament did and

what it intended to do. Here, that means not denying that Parliament ultimately intended

to reduce GHG emissions but, rather, recognizing that its goal in enacting this particular

statute was to establish minimum national standards of GHG price stringency to reduce

GHG emissions.

(c) Legal Effects

[70]

A law’s legal effects are discerned from its provisions by asking “how the

legislation as a whole affects the rights and liabilities of those subject to its terms”:

Morgentaler, at p. 482. In my view, the legal effects of the GGPPA confirm that its

focus is on national GHG pricing and confirm its essentially backstop nature.

[71]

In jurisdictions where Parts 1 and 2 of the GGPPA are applied, the primary

legal effect is to create one GHG pricing scheme that prices GHG emissions in a

manner that is consistent with what is done in the rest of the Canadian economy. Certain

fuel producers, distributors and importers are required to pay a charge for fuel and for

combustible waste under Part 1. And as I explained earlier, the OBPS created by the

OBPS Regulations made under Part 2 creates a complex exemption to Part 1: covered

industrial facilities are exempt from the flat fuel charge under Part 1 of the GGPPA,

but must pay a charge that applies to the extent that they fail to meet applicable GHG

efficiency standards. Both Part 1 and Part 2 of the GGPPA thus directly price GHG

emissions. Part 1 directly prices the emissions of certain fuel producers, distributors

and importers. Part 2 directly prices the GHG emissions of covered facilities to the

extent that they exceed the applicable efficiency standards. Significantly, the GGPPA

does not require those to whom it applies to perform or refrain from performing

specified GHG-emitting activities. Nor does it tell industries how they are to operate in

order to reduce their GHG emissions. Instead, all the GGPPA does is to require persons

to pay for engaging in specified activities that result in the emission of GHGs. As the

majority of the Court of Appeal for Saskatchewan observed, the GGPPA leaves

“individual consumers and businesses . . . free to choose how they will respond, or not,

to the price signals sent by the marketplace”: para. 160. The legal effects of the GGPPA

are thus centrally aimed at pricing GHG emissions nationally. The GGPPA does not

represent an attempt to occupy other areas of the field of GHG emissions reduction that

were discussed in the Pan-Canadian Framework, such as tightening energy efficiency

standards and codes, taking sector-specific action with respect to electricity, buildings,

transportation, industry, forestry, agriculture, waste and the public sector, and

promoting clean technology innovation: pp. 2-3 and 7-25.

[72]

Moreover, because the GGPPA operates as a backstop, the legal effects of

Parts 1 and 2 of the statute — a federally imposed national GHG pricing scheme —

apply only if the Governor in Council has listed a province or territory pursuant to

s. 166 for Part 1 or s. 189 for Part 2. The GGPPA provides that the Governor in Council

may make decisions with respect to listing only “[f]or the purpose of ensuring that the

pricing of greenhouse gas emissions is applied broadly in Canada at levels that the

Governor in Council considers appropriate” (ss. 166(2) and 189(1)) and must, in

making them, “take into account, as the primary factor, the stringency of provincial

pricing mechanisms for greenhouse gas emissions” (ss. 166(3) and 189(2)). As a result,

the GHG pricing mechanism described in Parts 1 and 2 of the GGPPA will not come

into operation at all in a province or territory that already has a sufficiently stringent

GHG pricing system. Not only does this confirm the backstop nature of the GGPPA —

that of creating minimum national standards of GHG pricing — but this feature of the

statute gives legal effect to the federal government’s commitment in the Pan-Canadian

Framework to give the provinces and territories “the flexibility to design their own

policies to meet emissions reductions targets, including carbon pricing, adapted to each

province and territory’s specific circumstances”, as well as to “recognize carbon

pricing policies already implemented or in development by provinces and territories”:

pp. 7-8.

[73]

It is notable that the GGPPA does not itself define the word “stringency”

used in ss. 166 and 189. But this does not mean that the Governor in Council’s

discretion with respect to listing is “open-ended and entirely subjective”: Alta. C.A.

reasons, at para. 221. Rather, the Governor in Council’s discretion is limited both by

the statutory purpose of the GGPPA and by specific guidelines set out in the statute for

listing decisions: see Canada (Minister of Citizenship and Immigration) v. Vavilov,

2019 SCC 65, at para. 108; Katz Group Canada Inc. v. Ontario (Health and Long-Term

Care), 2013 SCC 64, [2013] 3 S.C.R. 810, at para. 24. Specifically, the discretion to

list a province or territory must be exercised in a way that is consistent with the statutory

purpose of reducing GHG emissions by putting a price on them. And any decision of

the Governor in Council with respect to listing would have to be consistent with the

specific guideline of ensuring that emissions pricing is applied broadly in Canada and

would have to take the stringency of existing provincial GHG pricing mechanisms into

account as the primary factor: preamble, para. 16, and ss. 166 and 189. Moreover,

because the GGPPA provides for a legal standard to be applied in assessing provincial

and territorial pricing mechanisms, any decision of the Governor in Council in this

regard would be open to judicial review to ensure that it is consistent with the purpose

of the GGPPA and with the specific constraints set out in ss. 166(2) and (3) and 189(1)

and (2). In other words, although the Governor in Council has considerable discretion

with respect to listing, that discretion is limited, as it must be exercised in accordance

with the purpose for which it was given. The Governor in Council certainly does not,

therefore, have “absolute and untrammelled ‘discretion’”: Vavilov, at para. 108,

quoting Roncarelli v. Duplessis, [1959] S.C.R. 121, at p. 140.

[74]

Similarly, the Governor in Council’s discretion under the GGPPA to make

regulations modifying the schedules and, in some cases, provisions of the statute itself

does not make the pith and substance of the GGPPA broader. Nor does it permit the

Governor in Council to include “any substance, material or thing known to mankind”

in the system under Part 1 or to boundlessly change the coverage of Part 2 of the

GGPPA by adding gases or redefining what qualifies as a covered facility in a way that

is unrelated to the underlying purpose of the statute: Alta. C.A. reasons, at paras. 227

and 237.

[75]

Under Part 1 of the GGPPA, the Governor in Council has the discretion to

make regulations prescribing anything that is to be prescribed or determined by

regulation under that Part (s. 166(1)(a)), including regulations in relation to the fuel

charge system (s. 168(2)), regulations modifying the listed types of fuel and the rates

of charge in Sch. 2 (ss. 166(4) and 168(3)(a)), and regulations defining words or

expressions used in Part 1 of the GGPPA, in Part 1 of Sch. 1, or in Sch. 2 (s. 168(3)(a)

and (b)). First, no aspect of this discretion permits the Governor in Council to regulate

GHG emissions broadly in any way other than by implementing a GHG pricing

scheme. Second, any exercise of the power to make regulations under Part 1 of the

GGPPA is constrained by that Part’s own words and statutory purpose. Part 1, as its

very title indicates, establishes a “Fuel Charge”. Any exercise of the regulation-making

power that prescribed substances other than fuel or combustible waste would be open

to judicial review and could be found to be ultra vires the GGPPA. Similarly, the

Governor in Council could not list a fuel or substance that does not emit GHGs when

burned; any regulation to that effect would be ultra vires the GGPPA, whose purpose

is to reduce GHG emissions by putting a price on GHGs.

[76]

The Governor in Council also has a discretion under Part 2 of the GGPPA,

that is, the discretion to make orders adding GHGs to, or deleting them from, Sch. 3 or

amending the global warming potential of any gas while taking into account any factor

the Governor in Council considers appropriate (ss. 190(1) and (2)), amending an excess

emissions payments charge in, or adding calendar years to, Sch. 4 (s. 191), or making

regulations pertaining to a number of aspects of the OBPS, including covered facilities,

GHG emissions limits, the quantification of GHGs, the circumstances under which

GHGs are deemed to have been emitted by a facility, compensation, and permitted

transfers of compliance units (s. 192). First, as with Part 1 of the GGPPA, no aspect of

the discretion provided for in Part 2 permits the Governor in Council to regulate GHG

emissions broadly or to regulate specific industries in any way other than by setting

GHG emissions limits and pricing excess emissions across the country. Instead, the

OBPS uses GHG intensity standards to set emissions limits and price emissions beyond

those limits in order to create incentives for behavioural change across industries.

Industrial entities can determine whether to increase their efficiency or to pay to exceed

their applicable efficiency standard emission limits. Second, the power to make orders

concerning which gases Part 2 applies to is also limited by the statutory purpose of

reducing GHG emissions through GHG pricing. If the Governor in Council were to list

a gas that does not contribute to GHG emissions or to indicate a figure for the global

warming potential of a gas that was unsupported by scientific evidence, the regulation

would be open to judicial review. As for the power to redefine what qualifies as a

covered facility, it must be understood in light of the title of Part 2, which specifies that

the focus is on “Industrial Greenhouse Gas Emissions”. Any attempt to extend Part 2

to a facility other than an industrial facility would also be ultra vires the GGPPA and

open to judicial review.

(d) Practical Effects

[77]

A law’s practical effects are “‘side’ effects flow[ing] from the application

of the statute which are not direct effects of the provisions of the statute itself”: Kitkatla,

at para. 54. Where, as here, a court is asked to adjudicate the constitutionality of

legislation that has been in force for only a short time, “any prediction of future

practical effect is necessarily short-term, since the court is not equipped to predict

accurately the future consequential impact of legislation”: Morgentaler, at p. 486.

[78]

In my view, the evidence of practical effects in the case at bar is not

particularly helpful for characterizing the GGPPA. Given the dearth of such evidence,

it would be unwise to attempt to predict the economic consequences of the GGPPA. It

is, moreover, not for the Court to assess how effective the GGPPA is at reducing GHG

emissions: Firearms, at para. 18.

[79]

Nonetheless, it should be noted that the evidence of practical effects to date

is consistent with the principle of flexibility and support for provincially designed GHG

pricing schemes. Practically speaking, the only thing not permitted by the GGPPA is

for a province or a territory not to implement a GHG pricing mechanism, or to

implement one that is not sufficiently stringent. The federal backstop GHG pricing

regime in Parts 1 and 2 of the GGPPA does not have a legal effect to the extent that

there is a provincial system of comparable stringency in place, whatever its design. For

example, the Governor in Council has declined to list Alberta under Part 2 of the

GGPPA, because Alberta’s self-designed Technology Innovation and Emissions

Reduction (“TIER”) system is considered to meet federal stringency requirements:

Alberta, TIER Regulation Fact Sheet, July 2020 (online). The government of Alberta

has itself described the TIER system as one “that is cost-efficient and tailored to

Alberta’s industries and priorities”: TIER Regulation Fact Sheet. Similarly, Part 2

applies only partially in Saskatchewan, because that province has implemented its own

output-based performance standards system for large industrial facilities. Part 2 applies

only to electricity generation and natural gas transmission pipelines, which are exempt

from Saskatchewan’s self-designed system: Sask. C.A. reasons, at para. 50; see also

Environment and Climate Change, Saskatchewan and pollution pricing, February 21,

2019 (online).

(e) Conclusion on Pith and Substance

[80]

For the foregoing reasons, I conclude that the true subject matter of the

GGPPA is establishing minimum national standards of GHG price stringency to reduce

GHG emissions. With respect, I cannot accept the broader characterizations of the

GGPPA advanced by the majorities of the Court of Appeal for Ontario and the Court

of Appeal of Alberta. Not only is GHG pricing central to the GGPPA, but Parts 1 and

2 of the statute operate as a backstop by creating a national GHG pricing floor. In my

view, a national GHG pricing scheme is not merely the means of achieving the end of

reducing GHG emissions. Rather, it is the entire matter to which the GGPPA is

directed, as is evident from the analysis of the purpose and effects of the statute. It is

also the most precise characterization of the subject matter of the GGPPA, as it

accurately reflects both what the statute does — imposing a minimum standard of GHG

price stringency — and why the statute does what it does — reducing GHG emissions

in order to mitigate climate change: see Quebec (Attorney General) v. Canadian

Owners and Pilots Association, 2010 SCC 39, [2010] 2 S.C.R. 536 (“COPA”), at

para. 17.

[81]

I would pause here to note that my colleague Brown J. argues that the

phrase “minimum national standards” is an artifice that adds nothing to the pith and

substance of the GGPPA. I respectfully disagree. Here, “minimum national standards”

gives expression to the national backstop nature of the GGPPA. In my view, this phrase

adds something essential to the pith and substance that goes to the true subject matter

of the GGPPA, because the statute operates as a national backstop that gives effect to

Parliament’s purpose of ensuring that GHG pricing applies broadly across Canada.

“Minimum national standards” expresses the fact that the GGPPA functions through

the imposition of an outcome-based minimum legal standard on all provinces and

territories at all times. This contrasts with the proposed federal legislation the Court

considered in 2011 Securities Reference, which had not been enacted to impose a

unified system of securities regulation for Canada that would apply in all the provinces

and territories, but would instead have permitted provinces to opt in, in the hope that

this would create an effective unified national securities regulation system: para. 31.

By contrast, the GGPPA applies in all the provinces at all times. It is “national” in

scope. At the same time, the backstop system set out in the GGPPA also gives the

provinces flexibility by allowing them to implement their own GHG pricing

mechanisms, provided they meet the federally determined standard of stringency. It

imposes “minimum standards”. In this way, the GGPPA does not create a blunt unified

national system. The national GHG pricing system provided for in it is limited to the

imposition of minimum national standards of stringency.

[82]

Moreover, the legislation in this case is distinguishable from the

equivalency provision of the Canadian Environmental Protection Act, R.S.C. 1985, c.

16 (4th Supp.), that was considered in Hydro-Québec. In that case, the equivalency

provision was but one feature of the federal legislation at issue, which had a broader

pith and substance of prohibiting acts causing the entry of certain toxic substances into

the environment: para. 130. In the instant case, as I have mentioned, the GGPPA

operates as a backstop. The intrinsic evidence, the extrinsic evidence, the legal effects

and the practical effects all illustrate that operation as a backstop is the main thrust and

dominant characteristic of the GGPPA. In my view, a mechanism that may be a mere

feature of one law can be the defining feature of another law such that it goes to that

other law’s pith and substance. The evidence in this case clearly shows that Parliament

acted with a remedial mindset in order to address the risks of provincial non-

cooperation on GHG pricing by establishing a national GHG pricing floor.

[83]

I also note here that my colleague Côté J. finds that ss. 166(2), 166(4),

168(4) and 192 of the GGPPA are unconstitutional delegations of power to the

Governor in Council (at para. 242). I respectfully disagree.

[84]

First, it is necessary to review the concept of delegation. As this Court

explained in 2018 Securities Reference, the principle of parliamentary sovereignty

“means that the legislature has the authority to enact laws on its own and the authority

to delegate to some other person or body certain administrative or regulatory powers,

including the power to make binding but subordinate rules and regulations”: para. 73

(emphasis in original). Delegation is common in the administrative state: ibid. As this

Court further explained, “a delegated power is rooted in and limited by the governing

statute . . . . [T]he sovereign legislature always ultimately retains the complete authority

to revoke any such delegated power”: para. 74.

[85]

This Court has consistently held that delegation such as the one at issue in

this case is constitutional. Even broad or important powers may be delegated to the

executive, so long as the legislature does not abdicate its legislative role. In Hodge v.

The Queen, (1883) 9 App. Cas. 117, the starting point of the jurisprudence on delegated

authority, the Privy Council found that the Ontario legislature’s delegation of power to

a board to regulate and license taverns was constitutional. The Privy Council held that

delegating the power to make “important regulations” did not amount to an abdication

of the legislature’s role and that the choice and the extent of any such delegation were

matters for the legislature, not the courts. Next, in Re George Edwin Gray (1918), 57

S.C.R. 150, this Court affirmed the constitutionality of a very broad grant of law-

making power by Parliament to the Governor in Council that included a “Henry VIII

clause”, that is, a clause by which Parliament delegates to the executive the power to

make regulations that amend an enabling statute: see also Shannon v. Lower Mainland

Dairy Products Board, [1938] A.C. 708 (P.C.), in which a broad delegation to the

provincial executive by way of a provincial skeletal statute was upheld. This Court

affirmed and applied Re Gray in Reference as to the Validity of the Regulations in

relation to Chemicals, [1943] S.C.R. 1. And in R. v. Furtney, [1991] 3 S.C.R. 89,

Stevenson J., writing for a unanimous Court, commented in obiter that “[t]he power of

Parliament to delegate its legislative powers has been unquestioned, at least since the

Reference as to the Validity of the Regulations in relation to Chemicals. The delegate

is, of course, always subordinate in that the delegation can be circumscribed and

withdrawn”: p. 104 (citations omitted). This governing law has been consistently

applied by courts of appeal: see, e.g., R. v. P. (J.) (2003), 67 O.R. (3d) 321, at paras.

20-23 (C.A.); Canadian Generic Pharmaceutical Association v. Canada (Health),

2010 FCA 334, [2012] 2 F.C.R. 618, at para. 63; House of Sga’nisim v. Canada

(Attorney General), 2013 BCCA 49, 41 B.C.L.R. (5th) 23, at paras. 89-91.

[86]

None of the impugned provisions are unconstitutional delegations of power

to the Governor in Council. Sections 166(2), 166(4) and 192 of the GGPPA are

permissible delegations of law-making power to the Governor in Council to implement

Parliament’s policy choice to legislate a nationwide GHG pricing backstop. Section

166(2) and s. 166(4) allow the Governor in Council to determine where and to what the

fuel charge established and detailed in Part 1 of the statute applies. Section 192 permits

the Governor in Council to make regulations to implement the OBPS established in

Part 2 of the GGPPA. Legislatures frequently include provisions with a similar

regulation-making scope to that of s. 192 in complex environmental legislative

schemes: see, e.g., Environmental Protection Act, R.S.O. 1990, c. E.19, ss. 175.1 to

177 (provisions that have been used to develop a scheme equivalent to the OBPS in

Greenhouse Gas Emissions Performance Standards, O. Reg. 241/19); Carbon Tax Act,

S.B.C. 2008, c. 40, s. 84; Greenhouse Gas Industrial Reporting and Control Act, S.B.C.

2014, c. 29, ss. 46 to 53; Environmental Protection and Enhancement Act, R.S.A. 2000,

c. E-12, ss. 37(1), 59, 86, 120, 122(1), 133, 146, 162, 166, 175, 187, 193 and 239;

Environment Quality Act, CQLR, c. Q-2, s. 46.5 (a provision used to develop Quebec’s

cap-and-trade system in Regulation respecting a cap-and-trade system for greenhouse

gas emission allowances, CQLR, c. Q-2, r. 46.1). Indeed, it is common for a statute to

“set out the legislature’s basic objects and provisions”, while “most of the heavy lifting

[is] done by regulations, adopted by the executive branch of government under orders-

in-council”: B. McLachlin, P.C., Administrative Tribunals and the Courts: An

Evolutionary Relationship, May 27, 2013 (online).

[87]

To the extent that the GGPPA delegates to the executive the power to make

regulations that amend the statute, such as in s. 168(4), this too, constitutes a

permissible delegation to the Governor in Council. As I explained above, the

constitutionality of Henry VIII clauses is settled law, and I would decline to revisit the

issue in this case. Furthermore, the power to make regulations under a Henry VIII

clause is not exempted from the general rules of administrative law. Any regulation

that is made must be consistent both with specific provisions of the enabling statute

and with its overriding purpose or object (Waddell v. Governor in Council (1983), 8

Admin. L.R. 266 (B.C.S.C.), at p. 292, quoted in Katz Group, at para.ꢀ24), and it must

be “within the scope [of] and subject to the conditions prescribed” by that statute (Re

Gray, at p.ꢀ168). Therefore, the scope of the authority delegated in s. 168(4) is limited

by and subject to the provisions of the GGPPA. The Governor in Council cannot use s.

168(4) of the GGPPA to alter the character of Part 1 of the statute, since any exercise

of this authority to make regulations that are inconsistent with either the general

purpose of reducing GHG emissions through the specific means of establishing

minimum national standards of GHG price stringency would be ultra vires the GGPPA

and open to judicial review. Moreover, the Governor in Council’s power under s.

168(4) can be revoked by Parliament.

[88]

In the case at bar, Parliament, far from abdicating its legislative role, has

in the GGPPA instituted a policy for combatting climate change by establishing

minimum national standards of GHG price stringency. Sections 166(2), 166(4), 168(4)

and 192 of the GGPPA simply delegate to the executive a power to implement this

policy. This delegation of power is within constitutionally acceptable limits and the

general rules of administrative law apply to constrain the Governor in Council’s

discretion under all of these provisions.

C. Classification of the GGPPA

(1) National Concern Doctrine

[89]

Canada argues that the GGPPA is constitutional on the basis of the national

concern doctrine. This doctrine is derived from the introductory clause of s. 91 of the

Constitution, which empowers Parliament “to make Laws for the Peace, Order, and

good Government of Canada, in relation to all Matters not coming within the Classes

of Subjects by this Act assigned exclusively to the Legislatures of the Provinces”

(“POGG power”). According to the doctrine, the federal government has jurisdiction

over matters that are found to be of inherent national concern. As Professor Hogg

explains, it “is residuary in its relationship to the provincial heads of power”: at p. 17-

1 to 17-2. Therefore, the national concern doctrine does not allow Parliament to

legislate in relation to matters that come within the classes of subjects assigned

exclusively to the provinces under s. 92. The national concern test is the mechanism by

which matters of inherent national concern, which transcend the provinces, can be

identified.

[90]

The effect of finding that a matter is one of national concern is permanent:

see Re: Anti-Inflation Act, at pp. 460-61. For this reason, a finding that the federal

government has authority on the basis of the national concern doctrine raises special

concerns about maintaining the constitutional division of powers. As La Forest J. put it

in Crown Zellerbach, when the federal government asserts its authority on this basis,

“[t]he challenge for the courts, as in the past, will be to allow the federal Parliament

sufficient scope to acquit itself of its duties to deal with national and international

problems while respecting the scheme of federalism provided by the Constitution”

(p. 448). By grappling with this challenge over time, the courts have developed a

workable framework for identifying federal authority on the basis of the national

concern doctrine in appropriate, exceptional cases and for adequately constraining

federal power in accordance with the principle of federalism.

[91]

Below, I will trace the development of this framework, beginning with a

discussion of the origins of the doctrine in Privy Council cases. I will then review how

this Court has dealt with the doctrine, consistently taking a restrained approach to

applying it while gradually developing its legal framework. Next, I will identify and

clarify some areas of ongoing uncertainty with respect to the national concern doctrine

and review the test for applying it. Lastly, I will apply the test to determine whether the

GGPPA represents a valid exercise of a federal power based on the national concern

doctrine.

(a) Origins of the National Concern Doctrine

[92]

The first two cases in which the Privy Council dealt with the national

concern doctrine, Russell v. The Queen (1882), 7 App. Cas. 829 (P.C.), and Attorney-

General for Ontario v. Attorney-General for the Dominion, [1896] A.C. 348 (P.C.)

(“Local Prohibition Reference”), speak to the potential for expansion of federal power

on the basis of the doctrine and to the importance of placing adequate constraints on

that power.

[93]

The issue in Russell was the constitutionality of the Canada Temperance

Act, 1878, S.C. 1878, c. 16, a federal statute establishing a local-option prohibition

scheme, that is, one that required local action in order to come into force in a given

county or city. Sir Montague Smith noted that the scope and objects of the law were

general — “to promote temperance by means of a uniform law throughout the

Dominion” — and that intemperance was “assumed to exist throughout the Dominion”:

pp. 841-42. He concluded that the law fell within federal jurisdiction: “Parliament deals

with the subject as one of general concern to the Dominion, upon which uniformity of

legislation is desirable, and the Parliament alone can so deal with it” (p. 841). As

commentators have noted, the reasoning in Russell appeared to open the door to a

potentially unlimited scope of federal power: A. S. Abel, “What Peace, Order and Good

Government?” (1968), 7 West. Ont. L. Rev. 1, at pp. 4-5; Hogg, at pp. 17-8 to 17-12.

[94]

The next time the Privy Council considered the national concern doctrine,

it recognized the potential breadth of the federal power as defined in Russell and

sounded a strong note of caution. Local Prohibition Reference concerned the

constitutionality of a provincial local-option prohibition scheme. The Privy Council

accepted “that some matters, in their origin local and provincial, might attain such

dimensions as to affect the body politic of the Dominion” and therefore to fall under

federal jurisdiction on the basis of the national concern doctrine: p. 361. However, Lord

Watson recognized the risk the national concern doctrine represented for the division

of powers in no uncertain terms: a failure to properly confine its application “would

practically destroy the autonomy of the provinces”: p. 361. He stressed that federal

authority based on the national concern doctrine must be “strictly confined to such

matters as are unquestionably of Canadian interest and importance” (p. 360) and urged

courts to exercise “great caution . . . in distinguishing between that which is local and

provincial, and therefore within the jurisdiction of the provincial legislatures, and that

which has ceased to be merely local or provincial, and has become [a] matter of national

concern, in such sense as to bring it within the jurisdiction of the Parliament of Canada”

(p. 361). The Privy Council upheld the provincial legislation at issue in that case.

Applying the double aspect doctrine, it held that provinces could regulate traffic in

alcohol from a local point of view where there was no issue with respect to federal

paramountcy: pp. 365-70; see also Hogg, at pp. 17-8 to 17-9.

[95]

The cautious approach urged in Local Prohibition Reference was reflected

in the rejection of federal jurisdiction over the regulation of insurance in In Re

“Insurance Act, 1910” (1913), 48 S.C.R. 260 (“Insurance Reference SCC”), aff’d

Attorney-General for Canada v. Attorney-General for Alberta, [1916] 1 A.C. 588

(“Insurance Reference PC”). In a majority opinion that was subsequently affirmed by

the Privy Council, Duff J. rejected the idea that the growth of the insurance business to

“great proportions” across Canada should ground the application of the POGG power:

p. 304. Duff J. was alive to the risk that an unconstrained approach to that power could

result in a continual expansion of federal jurisdiction over the provincial private sector

simply as a consequence of business growth.

[96]

As Professor G. Le Dain wrote before being appointed to this Court,

although it had been decided in the Insurance References that “mere growth and extent

was not to be the criterion for the application of the general power”, the criterion that

should be applied was not yet clear: “Sir Lyman Duff and the Constitution” (1974), 12

Osgoode Hall L.J. 261, at p. 277. The need to be cautious in applying the national

concern doctrine followed from Local Prohibition Reference, but the limits on the

federal power were not fully defined. In a series of cases over the next few decades, the

Privy Council, searching for a “concrete, specific and restrictive criterion” in order to

limit federal power based on the POGG clause, sought to restrict its application of that

clause to emergencies: Le Dain, at pp. 277-81; see also Hogg, at p. 17-9.

[97]

These cases did not satisfactorily reconcile the emergency requirement

with the reasoning in Russell and Local Prohibition Reference. The Privy Council

ultimately confronted this problem in Attorney-General for Ontario v. Canada

Temperance Federation, [1946] A.C. 193 (“Canada Temperance Federation”). In that

case, the issue was the constitutionality of a substantially similar successor to the

temperance statute that had been considered in Russell. Viscount Simon rejected an

argument that the POGG power could apply only in an emergency. In the critical

passage of his reasons, he stated the test as follows:

. . . the true test must be found in the real subject matter of the legislation:

if it is such that it goes beyond local or provincial concern or interests and

must from its inherent nature be the concern of the Dominion as a whole

(as, for example, in the Aeronautics case and the Radio case), then it will

fall within the competence of the Dominion Parliament as a matter

affecting the peace, order and good government of Canada, though it may

in another aspect touch on matters specially reserved to the provincial

legislatures. War and pestilence, no doubt, are instances; so, too, may be

the drink or drug traffic, or the carrying of arms. In Russell v. The Queen,

Sir Montague Smith gave as an instance of valid Dominion legislation a

law which prohibited or restricted the sale or exposure of cattle having a

contagious disease. [Citations omitted; pp. 205-6.]

Some of the examples Viscount Simon listed, such as war, would of course satisfy an

emergency requirement. The precise distinction between emergency cases and national

concern cases was ultimately clarified some decades later: see Re: Anti-Inflation Act,

at pp. 459-461. But the holding of Canada Temperance Federation with respect to

national concern is clear: an emergency is not required for a case to meet the national

concern test; instead, the test is whether the real subject matter of the legislation goes

beyond provincial concern and is, from its inherent nature, the concern of the country

as a whole. On this basis, Viscount Simon firmly established national concern as a

distinct branch of the POGG power that grounded federal jurisdiction over matters that

were inherently of national concern.

(b) Early Application of the National Concern Doctrine by the Court

[98]

This Court stepped into its role as the final court of appeal for Canada in

1949. Over the next two decades, there were only two matters that the Court, relying

on the Canada Temperance Federation test and heeding the concern for provincial

autonomy highlighted in Local Prohibition Reference, found to come within federal

jurisdiction on the basis of national concern. The first was aeronautics (Johannesson v.

Municipality of West St. Paul, [1952] 1 S.C.R. 292). The second was the development

of the National Capital Region: Munro, at p. 671. In the same period, Canadian lower

courts identified a third matter of national concern, the control of atomic energy: Pronto

Uranium Mines Limited v. The Ontario Labour Relations Board, [1956] O.R. 862

(H.C.); Denison Mines Ltd. v. Attorney-General of Canada, [1973] 1 O.R. 797 (H.C.).

[99]

Ten years after Munro, the Court applied the national concern doctrine

again, for the first time in the environmental context: Interprovincial Co-operatives

Ltd. v. The Queen, [1976] 1 S.C.R. 477. The issue was whether Manitoba could

legislate in relation to pollution that originated outside its provincial boundaries but

caused damage within them. The majority in the result, in reasons written by Pigeon J.,

held that a province has no authority to legislate in relation to acts done outside the

province, even if those acts cause damaging pollution to enter the province. Pigeon J.

recognized that the federal government can legislate in relation to the pollution of

interprovincial rivers, which he described as “a pollution problem that is not really local

in scope but truly interprovincial”: p. 514. The concurring and dissenting judges also

endorsed the view that the federal government has jurisdiction over interprovincial

rivers: pp. 499, 520 and 525-26. Although none of the judges explicitly referenced the

POGG power, the application of that power explains the result: Crown Zellerbach, at

pp. 445-46, per La Forest J. (dissenting, but not on this point); Morguard Investments

Ltd. v. De Savoye, [1990] 3 S.C.R. 1077, at p. 1099; W. R. Lederman, “Unity and

Diversity in Canadian Federalism: Ideals and Methods of Moderation” (1975), 53 Can.

Bar Rev. 597, at p. 614.

[100]

In applying Canada Temperance Federation in its decisions, this Court

confirmed that an emergency is not needed in order for a matter to be of national

concern, and offered some incremental guidance on the criteria for identifying a matter

that is inherently of national concern. Moreover, although the Court did find that the

federal government had jurisdiction in a small number of cases in that period, it

“exhibited the caution and restraint” displayed in the Privy Council’s approach to the

doctrine: Lederman, at p. 609.

(c) Development of the National Concern Test

[101]

The specific parameters of the limits on the federal power began to take

shape in Re: Anti-Inflation Act, which marked the Court’s first serious effort to wrestle

with the national concern doctrine. The issue was the constitutionality of the federal

Anti-Inflation Act, S.C. 1974-75-76, c. 75, the purpose of which was to

comprehensively contain and reduce inflation. A majority of the Court upheld the law

as a valid exercise of Parliament’s POGG power on the basis of the existence of an

emergency. Although Beetz J. dissented in the result, his views on the national concern

doctrine were endorsed by a majority of the Court.

[102]

As in the cases discussed above, Beetz J. stressed the threat the national

concern doctrine poses to provincial autonomy. In an emergency case, federal

jurisdiction on the basis of the POGG power is temporary, but the national concern

doctrine involves a finding of federal jurisdiction that is permanent: p. 461. Beetz J.

emphasized that federal jurisdiction over a matter of national concern is exclusive.

Thus, if the federal government were found to have jurisdiction over the proposed

matter of “containment and reduction of inflation”, then “the provinces could probably

continue to regulate profit margins, prices, dividends and compensation if Parliament

saw fit to leave them any room; but they could not regulate them in relation to inflation

which would have become an area of exclusive federal jurisdiction”: pp. 444-45. If

broad subjects such as “inflation”, “economic growth” or “protection of the

environment” were found to be matters of national concern, the federal-provincial

balance “would disappear not gradually but rapidly”: p. 445.

[103]

In Beetz J.’s view, the national concern doctrine does not allow for an

erosion of provincial autonomy such as that. After reviewing the jurisprudence, he

explained that the doctrine applies only to “clear instances of distinct subject matters

which do not fall within any of the enumerated heads of s. 92 and which, by nature, are

of national concern”: p. 457. Elaborating on the framework for identifying a matter that

is inherently of national concern, he found that federal authority based on the national

concern doctrine had rightly been reserved for “cases where a new matter was not an

aggregate but had a degree of unity that made it indivisible, an identity which made it

distinct from provincial matters and a sufficient consistence to retain the bounds of

form”: p. 458. The Court also had to consider the scale upon which the new matter

permitted Parliament to affect provincial matters so as to preserve the federal-

provincial division of powers. The containment and reduction of inflation failed these

tests. It lacked specificity and was instead an aggregate of several subjects, such as

monetary policy, public spending and restraint of profits, prices and wages, many of

which fell under provincial jurisdiction. Moreover, because its scope was so broad,

finding that it was a federal matter “would render most provincial powers nugatory”:

p. 458. Although Beetz J.’s views on the national concern doctrine were not

determinative in Re: Anti-Inflation Act, they were subsequently adopted by Le Dain J.

in Crown Zellerbach, in which the Court gave further structure to the national concern

doctrine.

[104]

There were several cases after Re: Anti-Inflation Act in which another

consideration was applied to limit the application of the national concern doctrine:

provincial inability. This test took centre stage in Labatt Breweries of Canada Ltd. v.

Attorney General of Canada, [1980] 1 S.C.R. 914, in which Estey J. endorsed the

following statement by Professor Hogg:

. . . the most important element of national dimension or national

concern is a need for one national law which cannot realistically be

satisfied by cooperative provincial action because the failure of one

province to cooperate would carry with it grave consequences for the

residents of other provinces.

(p. 945, quoting Constitutional Law of Canada (1977), at p. 261)

In Labatt Breweries, the brewing and labelling of beer failed the provincial inability

test. It was not “a matter of national concern transcending the local authorities’ power

to meet and solve it by legislation”: p. 945. Indeed, the proposed matter did not even

concern the extraprovincial distribution of beer, but instead related to the brewing

process itself: pp. 943-45. Likewise, in Schneider v. The Queen, [1982] 2 S.C.R. 112,

the Court explained that the treatment of drug dependency was not a matter of national

concern, because, unlike the illegal trade in drugs, one province’s failure to provide

treatment facilities would not endanger other provinces’ interests: p. 131. Bookending

this group of cases is R. v. Wetmore, [1983] 2 S.C.R. 284, in which Dickson J.,

dissenting but not on this point, rejected regulation of the pharmaceutical industry as a

matter of national concern. Dickson J. referred both to Beetz J.’s framework and to

Professor Hogg’s formulation of the provincial inability test, and concluded that the

matter failed to meet both standards: p. 296.

[105]

Crown Zellerbach afforded this Court an opportunity to give structure to

the national concern doctrine. At issue was the validity of s. 4(1) of the Ocean Dumping

Control Act, S.C. 1974-75-76, c. 55, which prohibited the dumping of any substance at

sea without a permit. The definition of the word “sea” in that Act excluded fresh waters

but included internal marine waters within provincial boundaries. In a split decision,

the Court found that the law was valid on the basis of the national concern doctrine.

Le Dain J., writing for the majority, restated that doctrine. After surveying the

jurisprudence, he set out a framework that now serves as a touchstone for analyzing

proposed matters of national concern, determining that the following four conclusions

were “firmly established”:

1. The national concern doctrine is separate and distinct from the national

emergency doctrine of the peace, order and good government power,

which is chiefly distinguishable by the fact that it provides a

constitutional basis for what is necessarily legislation of a temporary

nature;

2. The national concern doctrine applies to both new matters which did not

exist at Confederation and to matters which, although originally matters

of a local or private nature in a province, have since, in the absence of

national emergency, become matters of national concern;

3. For a matter to qualify as a matter of national concern in either sense it

must have a singleness, distinctiveness and indivisibility that clearly

distinguishes it from matters of provincial concern and a scale of impact

on provincial jurisdiction that is reconcilable with the fundamental

distribution of legislative power under the Constitution;

4. In determining whether a matter has attained the required degree of

singleness, distinctiveness and indivisibility that clearly distinguishes it

from matters of provincial concern it is relevant to consider what would

be the effect on extra‑provincial interests of a provincial failure to deal

effectively with the control or regulation of the intra‑provincial aspects

of the matter. [pp. 431-32]

Le Dain J. elaborated on the final point, the provincial inability test. He reasoned that

provincial inability would be established where a “provincial failure to deal effectively

with the intra-provincial aspects of the matter could have an adverse effect on

extra-provincial interests”: p. 434. He characterized provincial inability as “one of the

indicia” of singleness or indivisibility: ibid.

[106]

Applying this framework to the federal ocean dumping law at issue in that

case, Le Dain J. held that the law was valid on the basis of the national concern doctrine.

He found that marine pollution in general is clearly a matter of concern to Canada as a

whole because of its predominantly extraprovincial and international character.

Focusing specifically on “the control of pollution by the dumping of substances in

marine waters, including provincial marine waters”, Le Dain J. concluded that this

matter is single and distinctive: p. 436. In a relevant international convention, marine

pollution by dumping was treated as a distinct and separate form of water pollution.

Marine pollution has its own characteristics and scientific considerations that

distinguish it from fresh water pollution. It is indivisible, because there is a close

relationship between pollution in provincial internal waters and pollution in the federal

territorial sea, and because it is difficult to ascertain by visual observation the boundary

between these waters. The distinction in the statute between fresh water and salt water

ensured that the matter would have “ascertainable and reasonable limits” so that its

impact on provincial jurisdiction would be acceptable: p. 438.

[107]

In the more than 30 years since Crown Zellerbach, the Court has not found

that the federal government has jurisdiction over any new matters of national concern.

However, in Ontario Hydro v. Ontario (Labour Relations Board), [1993] 3 S.C.R. 327,

the Court accepted the earlier finding by lower courts that atomic energy is a matter of

national concern: see Pronto; Denison. In accepting the applicability of the national

concern doctrine in that case, this Court was unanimous on the point that federal

jurisdiction over atomic energy is grounded in the potential for catastrophic

interprovincial and international harm. At issue was whether labour relations

comprised part of the matter of atomic energy. A majority of the Court held that labour

relations falls within that matter of national concern, finding that labour relations is

“integral” to the federal interests that make atomic energy a national concern: pp. 340,

352 and 379-80.

[108]

Finally, the most recent case in which the Court considered the national

concern doctrine was Hydro-Québec. At issue was the constitutional validity of Part II

of the Canadian Environmental Protection Act, which empowered federal ministers to

determine what substances are toxic and to prohibit the introduction of such substances

into the environment except in accordance with specified terms and conditions.

La Forest J., writing for the majority, upheld the law on the basis of the criminal law

power and declined to apply the national concern doctrine. He cautioned against an

“enthusiastic adoption” of that doctrine, but acknowledged that a “discrete area of

environmental legislative power” can form a matter of national concern if it meets the

Crown Zellerbach test: paras. 115-16.

[109]

From the infancy of the national concern doctrine in Local Prohibition

Reference to the Court’s most recent consideration of the doctrine in Hydro-Québec,

the jurisprudence reviewed above shows that the Court has been responsive to the

legitimate concern that the doctrine poses a threat to provincial autonomy. The national

concern test, properly understood, adequately addresses this risk. The test places a clear

limit on the federal POGG power and ensures that the national concern doctrine can be

applied only in exceptional cases, where doing so is necessary in order for the federal

government to discharge its duty to address truly national problems and is consistent

with the division of powers.

(2) Clarifying the National Concern Doctrine

[110]

The case law reviewed above firmly establishes the national concern

doctrine in Canadian law and explains the fundamental principles underlying its

application. This doctrine applies only to matters that transcend the provinces owing to

their inherently national character. In Crown Zellerbach, this Court explained that a

proposed matter of national concern must have a “singleness, distinctiveness and

indivisibility”. Furthermore, a finding that the matter is one of national concern must

be reconcilable with the division of powers.

[111]

As can be seen from the decisions of the courts below and from the parties’

arguments, there is significant uncertainty regarding a number of issues that are central

to the national concern doctrine. This is unsurprising, given that there are very few

recent cases concerning the doctrine, which in turn flows from the fact that one of its

defining features is its restrictive application. This case presents an opportunity to

clarify these issues.

[112]

In particular, each of the steps of the national concern test requires further

discussion. Before turning to those steps, however, I must address two preliminary

issues with respect to the “matter” in question in the analysis. First, there is some

uncertainty about what the “matter” to which the national concern test applies actually

is. Second, this case raises the question of the scope and nature of the federal power

over a matter of national concern, and in particular whether the double aspect doctrine

can apply in this context. In other words, what are the consequences for the division of

powers of identifying a new matter of national concern? The answer to this question

will have a significant impact on the analysis undertaken at the final step of the test, at

which the court must determine whether finding that the proposed matter is one of

national concern is reconcilable with the division of powers.

[113]

Throughout my analysis on these issues, I will be relying in part on this

Court’s trade and commerce jurisprudence, and in particular on 2011 Securities

Reference and 2018 Securities Reference. As the Court has observed, the national

concern doctrine and the trade and commerce power pose similar challenges to

federalism. In both contexts, the Court has interpreted the federal power narrowly to

ensure that it does not overwhelm provincial jurisdiction and undermine the federal-

provincial division of powers: Re: Anti-Inflation Act, at p. 458; Wetmore, at p. 294.

Although the Court has not addressed the national concern doctrine in any detail for

many years, the more recent cases of 2011 Securities Reference and 2018 Securities

Reference, in which it applied the general branch of the trade and commerce power,

offer useful insight and are consistent with the modern approach to federalism.

However, my citing these cases should not be taken as an invitation to conflate the two

powers. They are distinct, and, as Beetz J. warned in Re: Anti-Inflation Act, courts

should be “all the more careful” when applying the residual POGG power than when

interpreting the enumerated trade and commerce power: p. 458.

(a) “Matter” of National Concern

[114]

As I explained above, the division of powers analysis follows a familiar

pathway. The first stage is to characterize the pith and substance, or matter, of the

impugned statute or provision. The second stage is to classify that matter by reference

to the heads of power set out in the Constitution. Having identified the pith and

substance of the GGPPA, I come now to the classification analysis in relation to the

national concern doctrine. The Attorney General of Saskatchewan argues that the

classification analysis in this context must depart from the usual framework. Rather

than assessing whether the matter of the statute can be classified on the basis of the

national concern doctrine, Saskatchewan submits that the classification analysis must

be applied to a different “proposed head of power” based on the POGG power, one cast

at a level of generality that is broader than the matter of the statute: A.F., at para. 58.

This approach cannot be accepted. There is no principled basis for departing from the

ordinary division of powers analysis to require that the matter of national concern

analyzed by the court at the classification stage be broader than the matter of the statute

as identified by the court at the characterization stage. Applying the classification

analysis to the matter of the statute in the context of the national concern doctrine is

consistent with the constitutional text, with the jurisprudence and with the principle of

judicial restraint.

[115]

First, as to the constitutional text, s. 91 does not provide in the context of

the POGG power that Parliament can make laws in relation to classes of subjects.

Instead, it states that Parliament can make laws for the peace, order, and good

government of Canada “in relation to . . . Matters”. Matters and classes of subjects are

distinct. Law-making powers are exercisable in relation to matters, which in turn

generally come within broader classes of subjects. A matter that falls under the POGG

power necessarily does not come within the classes of subjects enumerated in ss. 91

and 92. This does not mean, however, that the word “matter” has a different meaning

in the context of the POGG power. “Matter” is used in ss. 91 and 92 to refer to the pith

and substance of legislation: Firearms, at para. 16. Nothing in the words of the

Constitution supports the construction of a class of subjects under the POGG power

that is broader than the matter of the statute. Instead, the text of the Constitution

supports the approach of applying the national concern test to the matter of the statute

as identified by the court at the characterization stage.

[116]

Second, this approach is consistent with the jurisprudence. In the leading

cases on the national concern doctrine, the Court focused on the matter of the statute in

considering the classification issue. In Re: Anti-Inflation Act, the broad matter of

containment and reduction of inflation that Beetz J. rejected was not based on a statute

whose real focus was narrower, but was in fact what the Attorney General of Canada

identified as the matter of the statute at issue: p. 450. In Crown Zellerbach, the majority

did not find that marine pollution generally was a matter of national concern, but

instead found that the specific matter of the Ocean Dumping Control Act — the control

of marine pollution by the dumping of substances — was one: see p. 436. In those

cases, the pith and substance of the legislation itself determined the breadth and content

of the matter to which the national concern test was applied.

[117]

Third, this approach is consistent with the principle of judicial restraint. In

Munro, Cartwright J. emphasized on the subject of the national concern doctrine that

the court should “confine itself to the precise question raised in the proceeding which

is before it”: p. 672. Similarly, in Canadian Western Bank, this Court stated that courts

should not attempt to “define the possible scope of [broad] powers in advance and for

all time”, but should instead “procee[d] with caution on a case-by-case basis”: para. 43.

The Attorney General of Saskatchewan proposes that the court go beyond the precise

question asked. In fact, however, a more cautious approach is appropriate in the context

of the national concern doctrine, given its potential to disrupt the federal-provincial

balance. Put simply, if Parliament has not indicated in a statute that its intention is to

exercise jurisdiction over a broad matter, there is no reason for a court to artificially

construct such a broad matter.

[118]

Finally, I respectfully reject the suggestion that this approach somehow

conflates the characterization and classification stages: see Ont. C.A. reasons, at

para. 224. It does not. As I explained above, the analyses at the two stages are distinct.

At the first stage, a court must follow the accepted approach to the pith and substance

analysis in order to characterize the matter of the statute. As both Karakatsanis J. and

Kasirer J. recently stated in Genetic Non-Discrimination, the court must focus on “the

law itself and what it is really about”: paras. 31 and 165. Only then does it proceed to

the classification analysis, which in the case at bar involves consideration of the

national concern doctrine. If the matter is not legally viable as a matter of national

concern, then, as was the case in Re: Anti-Inflation Act, the statute cannot be upheld on

the basis of that doctrine. If, on the other hand, the matter meets the national concern

test, then the statute will be valid. Respectfully, this does not “constitutionalize” the

statute: see Ont. C.A. reasons, at para. 224. It simply determines the validity of the law

and resolves the question before the court.

[119]

Therefore, the matter to consider in this national concern analysis is

establishing minimum national standards of GHG price stringency to reduce GHG

emissions. I agree with the majority of the Court of Appeal for Saskatchewan that

stringency in this context is not limited to the charge per unit of GHG emissions. It

encompasses the scope or breadth of application of the charge in the sense of the fuels,

operations and activities to which the charge applies and the authority to implement

regulatory schemes that are necessary in order to implement such a charge: para. 139.

(b) Exclusive Federal Jurisdiction Based on the National Concern Doctrine

[120]

There is no doubt that a finding that a matter is of national concern confers

exclusive jurisdiction over that matter on Parliament: Re: Anti-Inflation Act, at p. 444;

Crown Zellerbach, at pp. 433 and 455; Hydro-Québec, at para. 115. However, the

nature and consequences of this exclusive federal jurisdiction is contested by the parties

in this case and requires clarification. Understanding the consequences of the

recognition of a new matter of national concern is critical in order to properly undertake

the scale of impact analysis at the third step of the national concern test.

[121]

Uncertainty about the nature of exclusive federal jurisdiction based on the

national concern doctrine may be rooted in the use of the word “plenary” to describe

the power in certain cases. In Crown Zellerbach, Le Dain J. characterized Beetz J.’s

views in Re: Anti-Inflation Act as follows: “. . . where a matter falls within the national

concern doctrine . . . Parliament has an exclusive jurisdiction of a plenary nature to

legislate in relation to that matter, including its intra-provincial aspects” (p. 433).

However, Le Dain J. went on to reject the proposition that there must be “plenary

jurisdiction . . . to deal with any legislative problem”: p. 434. In Ontario Hydro, a

majority of this Court concluded that federal jurisdiction based on the national concern

doctrine is not plenary and does not give Parliament jurisdiction over “all aspects” of,

in that case, atomic energy. Instead, the Court had to determine whether the regulation

of labour relations falls within the national concern aspects of atomic energy: pp. 340

and 425; see also M. Olsynski, N. Bankes, and A. Leach, “Breaking Ranks (and

Precedent): Reference re Greenhouse Gas Pollution Pricing Act, 2020 ABCA 74”

(2020), 33 J. Env. Law & Prac. 159, at pp. 180-81; A. Leach, and E. M. Adams, “Seeing

Double: Peace, Order, and Good Government, and the Impact of Federal Greenhouse

Gas Emissions Legislation on Provincial Jurisdiction” (2020), 29 Const. Forum 1, at

n. 71.

[122]

In my view, describing the power as “plenary” is unhelpful. The word

“plenary” speaks to the scope of the power: see RJR-MacDonald Inc. v. Canada

(Attorney General), [1995] 3 S.C.R. 199, at paras. 28 and 32. As can be seen from

Ontario Hydro, in the context of the national concern doctrine, the scope of the federal

power is defined by the nature of the national concern itself. Only aspects with a

sufficient connection to the underlying inherent national concern will fall within the

scope of the federal power. It was not a foregone conclusion that labour relations at a

nuclear generating station would fall within the federal government’s jurisdiction over

atomic energy, as one might expect if the national concern doctrine grounded a

“plenary” federal power. Rather, the question was whether the safety concerns that

make atomic energy a matter of inherent national concern had a sufficient connection

to labour relations to bring labour relations within the scope of the federal power.

[123]

The Attorney General of Ontario asserts, as a general proposition, that

“[t]he consequences of recognizing a new matter of national concern are sweeping”:

A.F., at para. 64. It is true that the recognition of any new matter of national concern

has consequences for federalism. However, the scope of such consequences is case-

specific because, as I have just explained, the scope of the federal power in the context

of the national concern doctrine depends on the nature of the national concern at issue

in the case in question.

[124]

Thus, there is some truth to Ontario’s submission in the case of, for

example, the national concern matter of aeronautics. But this flows from the particular

nature of the matter of aeronautics and not from the general nature of the national

concern doctrine. The siting of aerodromes falls within the federal power over

aeronautics, not because aeronautics has some predetermined breadth flowing from its

status as a matter of national concern, but because the nature of the matter is such that

it must include “terrestrial installations that facilitate flight”: Quebec (Attorney

General) v. Lacombe, 2010 SCC 38, [2010] 2 S.C.R. 453, at para. 27. Moreover, in its

early case law on aeronautics, this Court held that the siting of aerodromes is not merely

within the scope of the federal power, but is essential to that power, such that the

doctrine of interjurisdictional immunity applies: Johannesson, at p. 295; COPA, at

para. 37. The application of interjurisdictional immunity to any federal power has an

obvious impact on provincial jurisdiction. But interjurisdictional immunity does not

automatically apply to matters of national concern. It was applied in COPA because

there was a precedent that compelled its application, not because the national concern

doctrine required that it be applied. Today’s restrained approach to interjurisdictional

immunity suggests that it would not apply to a newly identified matter of national

concern: Canadian Western Bank, at paras. 47 and 77. The example of aeronautics

therefore tells us little about the consequences of identifying any other matter of

national concern. Sensibly, the national concern test requires a case-specific inquiry

into whether the recognition of a particular matter of national concern is reconcilable

with the division of powers in the scale of impact analysis.

[125]

A closely related question concerns the applicability of the double aspect

doctrine to a matter of national concern. The double aspect doctrine “recognizes that

the same fact situations can be regulated from different perspectives, one of which may

relate to a provincial power and the other to a federal power”: Desgagnés Transport, at

para. 84. If a fact situation can be regulated from different federal and provincial

perspectives and each level of government has a compelling interest in enacting legal

rules in relation to that situation, the double aspect doctrine may apply: ibid., at

para. 85.

[126]

In my view, the double aspect doctrine can apply in cases in which the

federal government has jurisdiction on the basis of the national concern doctrine, but

whether or not it does apply will vary from case to case. This approach fosters

coherence in the law, because the double aspect doctrine can apply to every enumerated

federal and provincial head of power, including the general branch of the trade and

commerce power (e.g., General Motors of Canada Ltd. v. City National Leasing,

[1989] 1 S.C.R. 641, at p. 682; 2018 Securities Reference, at para. 114. See also S.

Choudhry, “Recasting social Canada: A reconsideration of federal jurisdiction over

social policy” (2002), 52 U.T.L.J. 163, at p. 231, fn. 212; S. Elgie, “Kyoto, The

Constitution, and Carbon Trading: Waking A Sleeping BNA Bear (Or Two)” (2007),

13 Rev. Const. Stud. 67, at p. 88), and can also apply in respect of POGG matters (e.g.,

Munro; Multiple Access Ltd. v. McCutcheon, [1982] 2 S.C.R. 161). Applying the

double aspect doctrine to the national concern doctrine is also consistent with the

modern approach to federalism, which favours flexibility and a degree of overlapping

jurisdiction: Desgagnés Transport, at para. 4; see also N. J. Chalifour, P. Oliver and T.

Wormington, “Clarifying the Matter: Modernizing Peace, Order, and Good

Government in the Greenhouse Gas Pollution Pricing Act Appeals” (2020), 40

N.J.C.L. 153, at pp. 204-6; Leach and Adams, at p. 6.

[127]

The National Capital Region provides a helpful example of the application

of the double aspect doctrine in the national concern context. The finding in Munro that

the development, conservation and improvement of the National Capital Region is a

matter of national concern has not displaced municipal planning and development,

which is based on a provincially delegated authority. Instead, the National Capital

Commission and the cities of Ottawa and Gatineau each regulate land use planning, the

Commission from the federal perspective of the national nature and character of the

national capital and the municipalities from a local perspective: J. Poirier, “Choix,

statut et mission d’une capitale fédérale: Bruxelles au regard du droit comparé”, in E.

Witte et al., eds., Bruxelles et son statut (1999), 61, at pp. 73-74; N. J. Chalifour,

“Jurisdictional Wrangling Over Climate Policy in the Canadian Federation: Key Issues

in the Provincial Constitutional Challenges to Parliament’s Greenhouse Gas Pollution

Pricing Act” (2019), 50 Ottawa L. Rev. 197, at p. 234; Leach and Adams, at p. 7.

[128]

However, as I noted above, the fact that the double aspect doctrine can

apply does not mean that it will apply in a given case. It should be applied cautiously

so as to avoid eroding the importance attached to provincial autonomy in this Court’s

jurisprudence. Beetz J. cautioned that it can be applied only “in clear cases where the

multiplicity of aspects is real and not merely nominal”: Bell Canada v. Quebec

(Commission de la santé et de la sécurité du travail), [1988] 1 S.C.R. 749, at p. 766. In

some cases, the double aspect doctrine has not been applied where federal jurisdiction

fell under the national concern doctrine: e.g., Rogers Communications Inc. v.

Châteauguay (City), 2016 SCC 23, [2016] 1 S.C.R. 467, at para. 51.

[129]

The double aspect doctrine takes on particular significance where, as in the

case at bar, Canada asserts jurisdiction over a matter that involves a minimum national

standard imposed by legislation that operates as a backstop. The recognition of a matter

of national concern such as this will inevitably result in a double aspect situation. This

is in fact the very premise of a federal scheme that imposes minimum national

standards: Canada and the provinces are both free to legislate in relation to the same

fact situation — in this case by imposing GHG pricing — but the federal law is

paramount.

[130]

I recognize that it might be argued that Canada and the provinces are

exercising their jurisdiction in relation to different matters rather than to different

aspects of the same matter, that is, that Canada’s authority is limited to minimum

national standards of GHG pricing stringency and that this is obviously different than

the matters in relation to which provinces might exercise jurisdiction over GHG

pricing. This view finds support in some of the language used by this Court, such as

the comment in Canadian Western Bank that the double aspect doctrine concerns “the

various ‘aspects’ of the ‘matter’”: para. 30. However, I do not read Canadian Western

Bank that narrowly, given this Court’s recent guidance in Desgagnés Transport, in

which it stated that the double aspect doctrine concerns “fact situations”. Moreover, the

fact that Canada can be understood to be empowered to deal only with a different matter

than the provinces does not change the resulting jurisdictional reality that where

Canada is empowered to impose a minimum national standard, a double aspect

situation arises: federal and provincial laws apply concurrently, but the federal law is

paramount. From the perspective of provincial autonomy, the corrosive effect is the

same. Therefore, courts must recognize that this amounts to an invitation to identify a

previously unidentified double aspect, with clear consequences for provincial

autonomy.

[131]

Beetz J.’s caution about the double aspect doctrine thus applies with

particular force where Canada asserts jurisdiction over a matter that involves a

minimum national standard. In such a case, even if the national concern test would

otherwise be met, Beetz J.’s caution should act as an additional check. The court must

be satisfied that Canada in fact has a “compelling interest” in enacting legal rules over

the federal aspect of the activity at issue and that the “multiplicity of aspects is real and

not merely nominal”: Desgagnés Transport, at para. 85; Bell Canada, at p. 766. As I

will explain in greater detail below, the court must be satisfied at the scale of impact

step that the consequences of finding that the proposed matter is one of national concern

are reconcilable with the division of powers.

(3) National Concern Test

[132]

I will now turn to the specifics of the test for identifying matters that are

inherently of national concern. As I will explain below, the applicable framework

involves a three-step process: the threshold question; the singleness, distinctiveness and

indivisibility analysis; and the scale of impact analysis. Before detailing these steps,

there are two points worth noting about the framework as a whole.

[133]

First, the recognition of a matter of national concern must be based on

evidence: see K. Swinton, “Federalism under Fire: The Role of the Supreme Court of

Canada” (1992), 55 Law & Contemp. Probs. 121, at p. 134; J. Leclair, “The Elusive

Quest for the Quintessential ‘National Interest’” (2005), 38 U.B.C. L. Rev. 353, at

p. 370. I find the Court’s trade and commerce power jurisprudence instructive in this

regard. In the 2011 Securities Reference, Canada argued that securities trading had once

been primarily a local matter, but that it had since evolved to become a “matter of

transcendent national concern” that brought it within the trade and commerce power:

para. 114. For this argument to succeed, Canada had to “present the Court with a factual

matrix” supporting its assertion of jurisdiction: para. 115. In other words, the onus was

on Canada to show that the statute at issue “addresses concerns that transcend local,

provincial interests” by producing “not mere conjecture, but evidentiary support”: para.

116. Similarly, an onus rests on Canada throughout the national concern analysis to

adduce evidence in support of its assertion of jurisdiction.

[134]

Second, there is no requirement that a matter be historically new in order

to be found to be one of national concern: Crown Zellerbach, at p. 432. Moreover, it is

not helpful to link historical newness to a finding of federal jurisdiction. Many new

developments may be predominantly local and provincial in character and fall under

provincial heads of power. As LeBel and Deschamps JJ. wrote in Assisted Human

Reproduction Act in the context of the federal criminal law power, reasoning that

novelty alone justifies federal jurisdiction would upset the federal-provincial balance:

paras. 255-56. I agree with scholars who have characterized newness as an unhelpful

or neutral factor in the national concern analysis: Hogg, at p. 17-18; K. Lysyk,

“Constitutional Reform and the Introductory Clause of Section 91: Residual and

Emergency Law-Making Authority” (1979), 57 Can. Bar Rev. 531, at pp. 571-72.

[135]

Given that historical newness is irrelevant to the analysis, it may be helpful

to explain certain references to “newness” in the jurisprudence. In Re: Anti-Inflation

Act, Beetz J. spoke of the application of the national concern doctrine only to “new

matters” (p. 458), whereas in Crown Zellerbach, Le Dain J. spoke of its applying to

both “new matters” and matters that had “become” matters of national concern (p. 432).

Some commentators suggest that Crown Zellerbach therefore represents a departure

from Beetz J.’s approach: J. Leclair, “The Supreme Court of Canada’s Understanding

of Federalism: Efficiency at the Expense of Diversity” (2003), 28 Queen’s L.J. 411, at

p. 429; E. Brouillet, La Négation de la nation: L’identité culturelle québécoise et le

fédéralisme canadien (2005), at p. 295.

[136]

In my view, all this confusion stems from what is meant by the word

“new”. In Re: Anti-Inflation Act, Beetz J. intended “new” to refer to matters that could

satisfy the national concern test. This included both “new” matters that did not exist in

1867 and matters that are “new” in the sense that our understanding of those subject

matters has, in some way, shifted so as to bring out their inherently national character:

see also Hogg, at pp. 17-17 to 17-18. The critical element of this analysis is the

requirement that matters of national concern be inherently national in character, not

that they be historically new. The use of the word “become” in Crown Zellerbach

served to articulate that the newness of the matter can also refer to our belated

understanding of a matter’s true or inherent nature: see pp. 427-28 and 430-31. This is

what Beetz J. meant when he explained that these matters are ones “which do not fall

within any of the enumerated heads of s. 92 and which, by nature, are of national

concern”: Re: Anti-Inflation Act, at p. 457 (emphasis added). There is no inconsistency

between Re: Anti-Inflation Act and Crown Zellerbach on this point. To be clear, the

national concern doctrine does not allow Parliament to legislate in relation to matters

that come within the classes of subjects assigned exclusively to the provinces. The

purpose of the analysis is strictly to determine whether a matter is by nature one of

national concern.

[137]

It follows that the majority of the Court of Appeal of Alberta erred in

adding, as a threshold restriction, that matters that originally fell under provincial heads

of power other than s. 92(16) of the Constitution are incapable of acquiring national

dimensions: para. 185. Instead, the possibility that an existing matter may be found to

be one of national concern provides a principled basis for courts to be responsive to

new evidence in their application of the constitutional text. This is as it should be:

“Constitutional texts must be interpreted in a broad and purposive manner.

Constitutional texts must also be interpreted in a manner that is sensitive to evolving

circumstances because they ‘must continually adapt to cover new realities’”: Comeau,

at para. 52 (citations omitted).

[138]

Let us consider atomic energy, the matter of national concern that this

Court identified in Ontario Hydro. This matter encompasses the mining of raw

materials such as uranium — materials that existed and were mined prior to the

discovery of atomic energy. Before World War II, the dominant characteristic of

uranium mining would likely have been the management of natural resources within

the province, which would have come within various enumerated provincial classes of

subjects: ss. 92(5), 92(9), 92(10) and 92(13) (s. 92A, while also relevant, did not come

into being until the Constitution was amended in 1982). But that did not prevent atomic

energy, including the production of its raw materials, from being found to be a matter

which is, by nature, of national concern because of its safety and security risks,

particularly the risk of catastrophic interprovincial harm: see Pronto; Denison; Ontario

Hydro. In other words, the discovery of atomic energy brought out the inherently

national character of uranium mining. The fact that uranium mining would have fallen

under provincial heads of power other than s. 92(16) prior to this discovery is irrelevant

to the analysis and did not preclude the finding that atomic energy is a matter of national

concern. The “historical newness” of atomic energy is equally irrelevant; the

dispositive feature of the cases in question was instead that the discovery of atomic

energy had led to evidence grounding a new understanding of the inherent nature of the

matter as one of national concern.

[139]

It also follows that I do not agree with my colleague Rowe J.’s articulation

of the national concern test, which consists of two requirements as follows: first, the

matter must not come within the enumerated powers; and second, the matter “must be

such that it cannot be shared between both orders of government and that it must be

entrusted to Parliament, exclusively, to avoid a jurisdictional vacuum” (Rowe J.’s

reasons, at para. 545). With great respect, I see a jurisprudential barrier to my

colleague’s approach, which I find myself unable to resolve. I am not persuaded that

the matters of national concern this Court has recognized, such as the development of

the National Capital Region (Munro; see also: Re: Anti-Inflation Act, at p. 457) or the

control of marine pollution by dumping (Crown Zellerbach), would necessarily meet

his test if it were applied in the manner he proposes. Nor, in my view, can Munro or

Crown Zellerbach be read as an application of my colleague’s methodology. In those

cases, this Court did not proceed by way of a two-step search for a jurisdictional

vacuum; rather, it applied the national concern test to identify matters of inherent

national concern.

[140]

Thus, Munro and Crown Zellerbach can be explained in light of a more

conventional understanding of the national concern doctrine that was articulated in

Crown Zellerbach itself and which I will explain in greater detail below. Marine

pollution is predominantly extraprovincial and international in character, while the

development of the national capital is of concern to Canada as a whole. The matters

proposed in those cases were specific and identifiable and had ascertainable and

reasonable limits. The requirement of provincial inability, understood in the sense of

serious extraprovincial harm, was met: “. . . the failure of either Quebec or Ontario to

cooperate in the development of the national capital region would have denied to all

Canadians the symbolic value of a suitable national capital”, and “. . . the failure of one

province to protect its waters would probably lead to the pollution of the waters of other

provinces as well as the (federal) territorial sea and high sea” (Hogg, at p. 17-14).

Lastly, the recognition of these matters was compatible with the division of powers.

The result of this analysis leads to the conclusion that these matters, by their nature,

transcend the provinces. They were thus shown to fall outside of s. 92 and were

appropriate matters for recognition under the national concern doctrine. I therefore

respectfully disagree with my colleague’s articulation of the national concern test.

[141]

To sum up, the purpose of the national concern analysis is to identify

matters of inherent national concern — matters which, by their nature, transcend the

provinces. “Historical newness” is irrelevant to this analysis, and there is no threshold

question whether the matter can be characterized as being new. Instead, the analysis

has three steps: the threshold question, which relates not to newness but to whether the

matter is of sufficient concern to Canada as whole; the singleness, distinctiveness and

indivisibility analysis; and the scale of impact analysis. The onus is on Canada to

adduce evidence to satisfy the court that a matter of inherent national concern is made

out. I will now discuss each of these three steps in detail.

(a) Threshold Question

[142]

Courts must approach a finding that the federal government has

jurisdiction on the basis of the national concern doctrine with great caution. The

analysis therefore begins by asking, as a threshold question, whether the matter is of

sufficient concern to Canada as a whole to warrant consideration under the doctrine.

This invites a common-sense inquiry into the national importance of the proposed

matter.

[143]

This Court’s analysis in key national concern decisions has begun with an

assessment of whether the matter at issue is one “of concern to Canada as a whole”:

Crown Zellerbach, at p. 436. In Munro, Cartwright J. began with an observation that the

matter was “the concern of Canada as a whole”: p. 671. The reasons of the majorities of

the Saskatchewan and Ontario courts of appeal in the instant case reflect this approach:

Richards C.J.S. began his analysis on this subject with the “broad starting point” of

“whether this matter is something of genuine national importance” (para. 146); Strathy

C.J.O. first asked whether “the matter is both ‘national’ and a ‘concern’” before

proceeding to the analysis of singleness, distinctiveness and indivisibility (para. 106).

Although this inquiry was not identified as a distinct step of the analysis in Crown

Zellerbach, it serves an important purpose. The threshold question ensures that the

national concern doctrine cannot be invoked too lightly and provides essential context for

the analysis that follows. Requiring that this question be asked as the first step of the test

is an appropriate, incremental development in the law to ensure that federal power under

the national concern doctrine is properly constrained.

[144]

At the threshold step, Canada must adduce evidence to satisfy the court that

the matter is of sufficient concern to Canada as a whole to warrant consideration in

accordance with the national concern doctrine. If Canada discharges this burden, the

analysis proceeds. This approach does not open the door to the recognition of federal

jurisdiction simply on the basis that a legislative field is “important”; it operates to limit

the application of the national concern doctrine.

(b) Singleness, Distinctiveness and Indivisibility

[145]

The second step of the analysis was explained by Le Dain J. as follows in

Crown Zellerbach: the matter “must have a singleness, distinctiveness and

indivisibility that clearly distinguishes it from matters of provincial concern” (p. 432).

Le Dain J. added that this inquiry includes the provincial inability test: “In determining

whether a matter has attained the required degree of singleness, distinctiveness and

indivisibility that clearly distinguishes it from matters of provincial concern it is

relevant to consider what would be the effect on extra‑provincial interests of a

provincial failure to deal effectively with the control or regulation of the

intra‑provincial aspects of the matter” (p. 432).

[146]

The phrase “singleness, distinctiveness and indivisibility” requires some

explanation. On its own, this phrase does not amount to a readily applicable legal test.

Rather, in my view, two principles underpin the singleness, distinctiveness and

indivisibility requirement and must be satisfied in order to determine that a matter is

one of national concern. In Le Dain J.’s formulation, these characteristics are essential

because they are features that clearly distinguish a matter of national concern from

matters of provincial concern. This is the first principle underpinning the singleness,

distinctiveness and indivisibility inquiry: to prevent federal overreach, jurisdiction

based on the national concern doctrine should be found to exist only over a specific and

identifiable matter that is qualitatively different from matters of provincial concern.

The recognition of “provincial inability” as a marker of singleness, distinctiveness and

indivisibility points to a second principle animating the inquiry: federal jurisdiction

should be found to exist only where the evidence establishes provincial inability to deal

with the matter. This means that the matter at issue is of a nature that the provinces

cannot address either jointly or severally, because the failure of one or more provinces

to cooperate would prevent the other provinces from successfully addressing it, and

that a province’s failure to deal with the matter within its own borders would have grave

extraprovincial consequences.

[147]

Regarding the first principle, the proposed federal matter must be specific

and readily identifiable. As Beetz J. made clear in Re: Anti-Inflation Act, a matter that

is “lacking in specificity” or is boundless cannot pass muster as a matter of national

concern: p. 458. The specific and identifiable matter must also be qualitatively different

from matters of provincial concern. It is clearly not enough for a matter to be

quantitatively different from matters of provincial concern — the mere growth or extent

of a problem across Canada is insufficient to justify federal jurisdiction: Insurance

Reference SCC; see also Le Dain, at pp. 277-78; Wetmore, at p. 296. The case law

points to several factors that properly inform this analysis.

[148]

One key consideration for determining whether the matter is qualitatively

different from matters of provincial concern is whether it is predominantly

extraprovincial and international in character, having regard both to its inherent nature

and to its effects. The case law demonstrates that this inquiry is central to the national

concern doctrine. The finding that marine pollution is extraprovincial and international

in its character and implications was critical to the recognition of a matter of national

concern in Crown Zellerbach: p. 436; see also Friends of the Oldman River Society v.

Canada (Minister of Transport), [1992] 1 S.C.R. 3, at p. 64. In Ontario Hydro, the

judges were unanimous in grounding the federal government’s jurisdiction over atomic

energy based on the POGG power in the potential for catastrophic interprovincial and

international harm. By contrast, in Hydro-Québec, the judges who considered the issue

concluded that the fact that the statute regulated substances whose effects were entirely

intraprovincial and localized was a barrier to its recognition as a matter of national

concern. However, they accepted that a matter dealing with toxic substances that

originate in a particular province may nonetheless be predominantly extraprovincial

and international in character if the substances in question have serious effects that can

cross provincial boundaries: paras. 68, 74 and 76.

[149]

International agreements may in some cases indicate that a matter is

qualitatively different from matters of provincial concern. Consideration of

international agreements figured into the Court’s national concern analysis in

Johannesson and in Crown Zellerbach: see also G. van Ert, “POGG and Treaties: The

Role of International Agreements in National Concern Analysis” (2020), 43 Dalhousie

L.J. 901, at p. 920. Significantly, the existence of treaty obligations is not determinative

of federal jurisdiction: there is no freestanding federal treaty implementation power and

Parliament’s jurisdiction to implement treaties signed by the federal government

depends on the ordinary division of powers: Attorney-General for Canada v. Attorney-

General for Ontario, [1937] A.C. 326 (P.C.). Treaty obligations and international

agreements can be relevant to the national concern analysis, however. Depending on

their content, they may help to show that a matter has an extraprovincial and

international character, thereby supporting a finding that it is qualitatively different

from matters of provincial concern.

[150]

Furthermore, to be qualitatively different from matters of provincial

concern, the matter must not be an aggregate of provincial matters: Re: Anti-Inflation

Act, at p. 458. The federal legislative role must be distinct from and not duplicative of

that of the provinces. Once again, the Court’s trade and commerce jurisprudence is

helpful in this regard. The Court’s opinions with respect to securities regulation show

that a regulatory field with an international or extraprovincial dimension can also have

local features. While there are aspects of securities regulation that are national in

character and have genuine national goals, much of this sphere is primarily focused on

local concerns related to investor protection and market fairness: 2011 Securities

Reference, at paras. 115 and 124-28; 2018 Securities Reference, at paras. 105-6. As the

2011 Securities Reference and the 2018 Securities Reference confirm, federal

legislation will not be qualitatively distinct if it overshoots regulation of a national

aspect of the field and instead duplicates provincial regulation or regulates issues that

are primarily of local concern.

[151]

Thus, the first principle underpinning the requirement of singleness,

distinctiveness and indivisibility is that federal jurisdiction may only be recognized

over a specific and identifiable matter that is qualitatively different from matters of

provincial concern. At this stage, the court should inquire into whether the matter is

predominantly extraprovincial and international in its nature or its effects, into the

content of any international agreements in relation to the matter, and into whether the

matter involves a federal legislative role that is distinct from and not duplicative of that

of the provinces.

[152]

I will now turn to the second principle, that is, that federal jurisdiction

should be found to exist only where the evidence establishes provincial inability to deal

with the matter. This Court’s jurisprudence in relation to the general branch of the trade

and commerce power is helpful on this point, too. The starting point for this analysis

should be the provincial inability test expressed through the fourth and fifth indicia

discussed in General Motors, at p. 662: (1) the legislation should be of a nature that the

provinces jointly or severally would be constitutionally incapable of enacting; and (2)

the failure to include one or more provinces or localities in a legislative scheme would

jeopardize the successful operation of the scheme in other parts of the country. For

provincial inability to be established for the purposes of the national concern doctrine,

both of these factors are required.

[153]

But there is a third factor that is required in the context of the national

concern doctrine in order to establish provincial inability: a province’s failure to deal

with the matter must have grave extraprovincial consequences. Professor Hogg

explains that evaluating extraprovincial harm helps to determine whether a national law

“is not merely desirable, but essential, in the sense that the problem ‘is beyond the

power of the provinces to deal with it’”: p. 17-14, quoting D. Gibson, “Measuring

‘National Dimensions’” (1976), 7 Man. L.J. 15, at p. 33. This connects the provincial

inability test to the overall purpose of the national concern test, which is to identify

matters of inherent national concern that transcend the provinces.

[154]

The need for “grave consequences for the residents of other provinces” was

adopted by this Court in Labatt Breweries (at p. 945) and can be seen woven throughout

its national concern jurisprudence. In Local Prohibition Reference, the Privy Council

suggested arms trafficking as an example of a potential matter of national concern,

which is consistent with this requirement of grave extraprovincial consequences

flowing from provincial inaction in relation to the matter: Local Prohibition Reference,

at p. 362. And in Johannesson, Locke J. of this Court had emphasized that one

province’s failure to provide space for aerodromes could have the “intolerable”

extraprovincial consequence of isolating northern regions of Canada: pp. 326-27.

Although the extraprovincial harm at issue in Munro was of a different nature, it was

nonetheless meaningful, as it would have resulted in the denial of a suitable national

capital to all Canadians. In Ontario Hydro, La Forest J. reasoned that one province’s

failure to effectively regulate atomic energy “could invite disaster”, endangering “the

safety of people hundreds of miles from a nuclear facility”: p. 379. In contrast, the

majority in Schneider reasoned that one province’s failure to provide treatment

facilities for heroin users “will not endanger the interests of another province”: p. 131.

This conception of provincial inability was reaffirmed in Crown Zellerbach.

[155]

The requirement of grave extraprovincial consequences sets a high bar for

a finding of provincial inability for the purposes of the national concern doctrine. This

requirement can be satisfied by actual harm or by a serious risk of harm being sustained

in the future. It may include serious harm to human life and health or to the

environment, though it is not necessarily limited to such consequences. Mere

inefficiency or additional financial costs stemming from divided or overlapping

jurisdiction is clearly insufficient: Wetmore, at p. 296. Moreover, as I noted above, the

onus is on Canada to establish that provincial inability is made out, and evidence is

required, “for the questions of provincial inability and the harm that flows therefrom

are both factual in part”: Swinton, at p. 134; see also Leclair (2005), at p. 370.

[156]

In Crown Zellerbach, Le Dain J. characterized provincial inability as an

indicium of singleness and indivisibility. But in much of this Court’s national concern

jurisprudence, it has been treated as a strict requirement rather than as a mere optional

indicium. Provincial inability has been used on this basis to reject national concern

arguments and limit the doctrine’s application: Labatt Breweries; Schneider; Wetmore.

In my view, provincial inability functions as a strong constraint on federal power and

should be seen as a necessary but not sufficient requirement for the purposes of the

national concern doctrine. Treating provincial inability as merely an optional indicium

“rob[s] it of its initial, necessity-based, narrowing effect and opens doors for national

concern”: G. Baier, “Tempering Peace, Order and Good Government: Provincial

Inability and Canadian Federalism” (1998), 9 N.J.C.L. 277, at p. 291; see also Leclair

(2005), at p. 360.

[157]

In conclusion, there are two principles that apply in relation to singleness,

distinctiveness and indivisibility: first, federal jurisdiction based on the national

concern doctrine should be found to exist only over a specific and identifiable matter

that is qualitatively different from matters of provincial concern; and second, federal

jurisdiction should be found to exist only where the evidence establishes provincial

inability to deal with the matter. Provincial inability will be established only if the

matter is of a nature that the provinces cannot address either jointly or severally,

because the failure of one or more provinces to cooperate would prevent the other

provinces from successfully addressing it, and if a province’s failure to deal with the

matter within its own borders would have grave extraprovincial consequences.

[158]

A few further words about indivisibility are in order, because my

colleagues Brown and Rowe JJ. say that it has been written out of the national concern

test in these reasons. The requirement of indivisibility is given effect through both of

the principles I have discussed. The first of these principles requires a specific and

identifiable matter which is not a boundless aggregate. The second principle requires

provincial inability, as it is clearly defined in Crown Zellerbach and, indeed, throughout

the Court’s national concern jurisprudence, which is a marker of indivisibility.

[159]

I respectfully disagree with my colleagues’ understanding of indivisibility,

according to which “interrelatedness” is a criterion for establishing indivisibility (Rowe

J.’s reasons, at paras. 545 and 548, citing Crown Zellerbach, at p. 434). Le Dain J.

referred to interrelatedness only once, in his explanation of why the provincial inability

test helps the court determine whether a matter has the “character of singleness or

indivisibility”: p. 434. Thus, if a province’s approach to the intraprovincial aspects of

a matter could cause grave extraprovincial harm — that is, if the provincial inability

test is met — the matter can be said to have an interrelatedness, which supports a

finding of indivisibility. One difficulty with my colleagues’ approach, in my view, is

that they treat interrelatedness (a situation in which the provincial inability test is met)

as sufficient to establish indivisibility, while at the same time maintaining that meeting

the provincial inability test cannot establish indivisibility (Rowe J.’s reasons, at paras.

545 and 560; see also Brown J.’s reasons, at para. 383). Respectfully, I would favour

giving effect to the requirement of indivisibility on the basis of the two principles I

have set out, which is consistent both with Le Dain J.’s treatment of interrelatedness

and with the national concern jurisprudence as a whole, and presents no such analytical

difficulties.

(c) Scale of Impact

[160]

At the final step of the national concern test, Canada must show that the

proposed matter has “a scale of impact on provincial jurisdiction that is reconcilable

with the fundamental distribution of legislative power under the Constitution”: Crown

Zellerbach, at p. 432; Hydro-Québec, at para. 66, per Lamer C.J. and Iacobucci J.

(dissenting, but not on this point). Determining whether the matter’s scale of impact is

reconcilable with the division of powers requires the Court to balance competing

interests. As Professor Elgie writes, it does not make sense to treat the acceptable

impact on provincial authority as a static threshold; instead, the effect on provincial

jurisdiction should be assessed in the context of the matter at issue: pp. 85-86.

[161]

The purpose of the scale of impact analysis is to prevent federal overreach:

S. Choudhry, Constitutional Law and the Politics of Carbon Pricing in Canada (2019),

IRPP Study 74, at p. 15; 2011 Securities Reference, at para. 61. In other words, it is

designed to protect against unjustified intrusions on provincial autonomy. In

accordance with this purpose, at this stage of the analysis, the intrusion upon provincial

autonomy that would result from empowering Parliament to act is balanced against the

extent of the impact on the interests that would be affected if Parliament were unable

to constitutionally address the matter at a national level. Identifying a new matter of

national concern will be justified only if the latter outweighs the former.

(d) Summary of the Framework

[162]

In summary, finding that a matter is one of national concern involves a

three-step analysis.

[163]

First, Canada must establish that the matter is of sufficient concern to the

country as a whole to warrant consideration as a possible matter of national concern.

This question arises in every case, regardless of whether the matter can be characterized

as historically new. If Canada discharges its burden at the step of this threshold inquiry,

the analysis will proceed.

[164]

Second, the court must undertake the analysis explained in Crown

Zellerbach through the language of “singleness, distinctiveness and indivisibility”.

More important than this terminology, however, are the principles underpinning the

inquiry. The first of these principles is that, to prevent federal overreach, jurisdiction

based on the national concern doctrine should be found to exist only over a specific and

identifiable matter that is qualitatively different from matters of provincial concern.

The second principle to be considered at this stage of the inquiry is that federal

jurisdiction should be found to exist only where the evidence establishes provincial

inability to deal with the matter.

[165]

If these two principles are satisfied, the court will proceed to the third and

final step and determine whether the scale of impact of the proposed matter of national

concern is reconcilable with the division of powers.

[166]

The onus is on Canada throughout this analysis, and evidence is required.

Where a proposed federal matter satisfies the requirements of all three steps of the

framework, there is a principled basis to conclude that the matter is one that, by its

nature, transcends the provinces and should be recognized as a matter of national

concern.

(4) Application to the GGPPA

(a) Threshold Question

[167]

Canada has adduced evidence that clearly shows that establishing

minimum national standards of GHG price stringency to reduce GHG emissions is of

sufficient concern to Canada as a whole that it warrants consideration in accordance

with the national concern doctrine. To begin, this matter’s importance to Canada as a

whole must be understood in light of the seriousness of the underlying problem. All

parties to this proceeding agree that climate change is an existential challenge. It is a

threat of the highest order to the country, and indeed to the world. This context, on its

own, provides some assurance that in the case at bar, Canada is not seeking to invoke

the national concern doctrine too lightly. The undisputed existence of a threat to the

future of humanity cannot be ignored.

[168]

That being said, the matter at issue here is not the regulation of GHG

emissions generally, and Canada is not seeking to have all potential forms of GHG

regulation classified as matters of national concern. Rather, the specific question before

the Court is whether establishing minimum national standards of GHG price stringency

to reduce GHG emissions is a matter of national concern.

[169]

The history of efforts to address climate change in Canada reflects the

critical role of carbon pricing strategies in policies to reduce GHG emissions. As

discussed above, Canada and all the provinces committed, in the Vancouver

Declaration, to including carbon pricing in the country’s efforts to reduce GHG

emissions. The subsequently established Working Group on Carbon Pricing

Mechanisms recognized in its final report that many experts regard carbon pricing as a

necessary tool for efficiently reducing GHG emissions: p. 5. The Working Group’s

final report had the support of all provinces and of Canada at the time it was published,

and its affirmation of the importance of carbon pricing is supported by the record in

this case. Similarly, the Specific Mitigation Opportunities Working Group, one of the

other three working groups established under the Vancouver Declaration, listed, in its

final report, “broad, economy-wide carbon pricing” as one of “three essential elements

of a comprehensive approach to mitigating GHG emissions”: Specific Mitigation

Opportunities Working Group, Final Report, 2016 (online), at p. 17.

[170]

Furthermore, there is a broad consensus among expert international bodies

such as the World Bank, the Organization for Economic Cooperation and Development

and the International Monetary Fund that carbon pricing is a critical measure for the

reduction of GHG emissions. For example, the High-Level Commission on Carbon

Prices’ Report of the High-Level Commission on Carbon Prices, May 29, 2017

(online), states: “A well-designed carbon price is an indispensable part of a strategy for

reducing emissions in an efficient way” (p. 1). And an International Monetary Fund

Staff Discussion Note entitled After Paris: Fiscal, Macroeconomic, and Financial

Implications of Climate Change states: “The central problem is that no single firm or

household has a significant effect on climate, yet collectively there is a huge effect —

so pricing is necessary to force the factoring of climate effects into individual-level

decisions” (M. Farid, et al., After Paris: Fiscal, Macroeconomic, and Financial

Implications of Climate Change, January 11, 2016 (online), at p. 6). In my view, the

evidence reflects a consensus, both in Canada and internationally, that carbon pricing

is integral to reducing GHG emissions.

[171]

In summary, the evidence clearly shows that establishing minimum

national standards of GHG price stringency to reduce GHG emissions is of concern to

Canada as a whole. This matter is critical to our response to an existential threat to

human life in Canada and around the world. As a result, it readily passes the threshold

test and warrants consideration as a possible matter of national concern.

(b) Singleness, Distinctiveness and Indivisibility

[172]

As I explained above, the first principle to be considered in the singleness,

distinctiveness and indivisibility inquiry is that federal jurisdiction based on the

national concern doctrine should be found to exist only over a specific and identifiable

matter that is qualitatively different from matters of provincial concern. Recognizing

minimum national standards of GHG price stringency to reduce GHG emissions as a

matter of national concern satisfies this requirement.

[173]

Given that the matter at issue is establishing minimum national standards

of GHG price stringency to reduce GHGs, it is important to begin by observing that

these gases are a specific and precisely identifiable type of pollutant. The harmful

effects of GHGs are known, and the fuel and excess emissions charges are based on the

global warming potential of the gases (see Sch. 3 of the GGPPA). Moreover, GHG

emissions are predominantly extraprovincial and international in their character and

implications. This flows from their nature as a diffuse atmospheric pollutant and from

their effect in causing global climate change. GHG emissions are precisely the type of

diffuse and persistent substances with serious deleterious extraprovincial effects that

the dissent in Hydro-Québec suggested might appropriately be regulated on the basis

of the national concern doctrine: para. 76. In Interprovincial Co-operatives, a case

concerning one province’s emission of pollutants into an interprovincial river,

Pigeon J. observed that the Court was “faced with a pollution problem that is not really

local in scope but truly interprovincial”: p. 514. GHG emissions represent a pollution

problem that is not merely interprovincial, but global, in scope.

[174]

The international response to GHG emissions over the past three decades

confirms this. As early as 1992, the preamble to the UNFCCC recognized climate

change as “a common concern of humankind”, and also acknowledged its “global

nature”. The acknowledgment that climate change is a common concern of humankind

was reiterated in the Paris Agreement. As well, the need for an effective international

response to climate change was recognized in both agreements. Specifically, the Paris

Agreement identifies imperatives of holding the increase in the global average

temperature to well below 2.0°C above pre-industrial levels and achieving net zero

emissions in the second half of the 21st century: arts. 2(1)(a) and 4(1). States parties

are therefore required to make nationally determined contributions that are increasingly

ambitious and to implement domestic mitigation measures for the purpose of ensuring

that those contributions are achieved: arts. 4(2) and (3). Both the UNFCCC and the

Paris Agreement help illustrate the predominantly extraprovincial and international

nature of GHG emissions and support the conclusion that the matter at issue is

qualitatively different from matters of provincial concern.

[175]

Not only is the type of pollutant to which the matter applies identifiable

and qualitatively different from matters of provincial concern, but the regulatory

mechanism of GHG pricing is a specific, and limited, one. It operates in a particular

way, seeking to change behaviour by internalizing the cost of climate change impacts,

incorporating them into the price of fuel and the cost of industrial activity. The

Vancouver Declaration and the Working Group on Carbon Pricing Mechanisms that it

established reflect the status of carbon pricing as a distinct form of regulation. GHG

pricing does not amount to the regulation of GHG emissions generally. It is also

different in kind from regulatory mechanisms that do not involve pricing, such as

sector-specific initiatives concerning electricity, buildings, transportation, industry,

forestry, agriculture and waste.

[176]

Minimum national standards of GHG price stringency, which are

implemented in this case by means of the backstop architecture of the GGPPA, relate

to a federal role in carbon pricing that is qualitatively different from matters of

provincial concern. The 2011 Securities Reference and 2018 Securities Reference

illustrate this point. The proposed legislation at issue in the 2011 Securities Reference

did not have a distinctly national focus; it ran afoul of the division of powers by

replicating existing provincial schemes: para. 116. However, the Court held that

“[l]egislation aimed at imposing minimum standards applicable throughout the country

and preserving the stability and integrity of Canada’s financial markets might well

relate to trade as a whole” and could be a matter of national importance to which the

federal general trade and commerce power applies: para. 114. This was the approach

the federal government took in the proposed legislation at issue in the 2018 Securities

Reference. The focus of that legislation was on controlling systemic risks that

represented a threat to the stability of the country’s financial system as a whole. Its

effect was “to address any risk that ‘slips through the cracks’ and poses a threat to the

Canadian economy”: para. 92. Rather than displacing provincial securities legislation

by ensuring the day-to-day regulation of securities trading, it sought to complement

provincial legislation by addressing national economic objectives: para. 96.

[177]

The backstop approach taken in the GGPPA is analogous to the approach

taken in the proposed legislation that was at issue in the 2018 Securities Reference. The

GGPPA establishes minimum national standards of price stringency to reduce GHG

emissions in order to ensure that Canada’s nationally determined contribution under

the Paris Agreement is achieved. It does so on a distinctly national basis, one that

neither represents an aggregate of provincial matters nor duplicates provincial GHG

pricing systems.

[178]

Moreover, the Governor in Council’s power to make a regulation that

applies the GGPPA’s pricing system to a province may be exercised only if it is first

determined that the province’s pricing mechanisms are insufficiently stringent: ss. 166

and 189. This is similar to the situation in the 2018 Securities Reference, in which the

legislation required the federal regulator to consider the adequacy of existing provincial

regulations before designating a benchmark or prescribing a product or practice:

para. 92. If each province designed its own pricing system and all the provincial

systems met the federal pricing standards, the GGPPA would achieve its purpose

without operating to directly price GHG emissions anywhere in the country. In other

words, the GGPPA’s pricing system comes into play only to address the risk of

increased GHG emissions that would otherwise “slip through the cracks” as a result of

one province’s failure to implement a sufficiently stringent pricing mechanism.

[179]

The GGPPA is tightly focused on this distinctly federal role and does not

descend into the detailed regulation of all aspects of GHG pricing. While it is true that

the administrative pricing mechanism set out in the GGPPA is detailed, it can apply

only to provinces that fail to meet the federal stringency standard. Thus, the GGPPA’s

fundamental role is a distinctly federal one: evaluating provincial pricing mechanisms

against an outcome-based legal standard in order to address national risks posed by

insufficient carbon pricing stringency in any part of the country. The GGPPA does not

prescribe any rules for provincial pricing mechanisms as long as they meet the federally

designated standard. Even if the GGPPA were to apply so as to supplement an

insufficiently stringent provincial pricing scheme, the prior existence of similar

provincial legislation is not, as this Court confirmed in the 2018 Securities Reference,

a constitutional bar to federal legislation that pursues a qualitatively different national

concern: para. 114; see also General Motors, at pp. 680-82.

[180]

Unlike the proposed legislation that was at issue in the 2011 Securities

Reference, the GGPPA does not depend on provinces “opt[ing] in”: para. 31. The

GGPPA imposes minimum standards of price stringency on all provinces at all times.

If a province is not listed, it is because the Governor in Council has determined that the

province’s system meets the federally determined standard, not because the province

has opted out. Thus, like the 2018 Securities Reference, the instant case involves the

distinctly federal role of setting national targets and stepping in to make up for an

absence of provincial legislation or to supplement insufficient provincial legislation.

The GGPPA deals with the specific regulatory mechanism of GHG pricing in a way

that is qualitatively different than how the provinces do so.

[181]

The second principle to be considered at this stage of the inquiry is that

federal jurisdiction should be found to exist only where the evidence establishes

provincial inability to deal with the matter. I find that provincial inability is established

in this case.

[182]

First, the provinces, acting alone or together, are constitutionally incapable

of establishing minimum national standards of GHG price stringency to reduce GHG

emissions. The situation here is much like the one in the 2018 Securities Reference, in

which the provinces would be able to enact legislation to address national goals relating

to systemic risk but could not do so on a sustained basis, because any province could

choose to withdraw at any time: para. 113; see also 2011 Securities Reference, at

paras. 119-21. In the instant case, while the provinces could choose to cooperatively

establish a uniform carbon pricing scheme, doing so would not assure a sustained

approach to minimum national standards of GHG price stringency to reduce GHG

emissions: the provinces and territories are constitutionally incapable of establishing a

binding outcome-based minimum legal standard — a national GHG pricing floor —

that applies in all provinces and territories at all times.

[183]

Second, a failure to include one province in the scheme would jeopardize

its success in the rest of Canada. It is true that a cooperative scheme might continue to

exist if one province withdrew from it, but the issue here is whether it would be

successful. The withdrawal of one province from the scheme would clearly threaten its

success for two reasons: emissions reductions that are limited to a few provinces would

fail to address climate change if they were offset by increased emissions in other

Canadian jurisdictions; and any province’s failure to implement a sufficiently stringent

GHG pricing mechanism could undermine the efficacy of GHG pricing everywhere in

Canada because of the risk of carbon leakage.

[184]

The evidence in the instant case shows that even significant emissions

reductions in some provinces have failed to further the goals of any cooperative

scheme, because they were offset by increased emissions in other provinces. Between

2005 and 2016, Canada’s total GHG emissions declined by only 3.8 percent:

Environment and Climate Change, National Inventory Report 1990-2016: Greenhouse

Gas Sources and Sinks in Canada — Executive Summary, 2018 (online), at p. 13. In

that period, emissions fell by 22 percent in Ontario, 11 percent in Quebec and 5.1

percent in British Columbia, three of the five provinces with the highest levels of

emissions in Canada, as well as by over 10 percent in New Brunswick, Nova Scotia,

Prince Edward Island and Yukon. But these decreases were largely offset by increases

of 14 percent in Alberta and 10.7 percent in Saskatchewan, the other two provinces

among the five with the highest levels of GHG emissions: p. 13. As a result, Canada

failed to honour its commitment under the Kyoto Protocol before withdrawing from

that agreement in 2011, and it is not currently on track to honour its Copenhagen

Accord commitment.

[185]

More recently, even though all the provinces made a commitment in the

Vancouver Declaration in March 2016 to work collectively to significantly reduce

GHG emissions, Saskatchewan had withdrawn by the time of the Pan-Canadian

Framework seven months later, and Ontario and Alberta also subsequently withdrew.

Together, these three provinces accounted for 71 percent of Canada’s total GHG

emissions in 2016: see National Inventory Report, at p. 13; Environment Canada, A

Climate Change Plan for the Purposes of the Kyoto Protocol Implementation Act —

2007, 2007 (online), at p. 17. It is true that their withdrawal from the Pan-Canadian

Framework does not mean that Saskatchewan, Ontario and Alberta will necessarily fail

to reduce their GHG emissions. But when provinces that are collectively responsible

for more than two thirds of Canada’s total GHG emissions opt out of a cooperative

scheme, this illustrates the stark limitations of a non-binding cooperative approach. The

participating provinces can only reduce their own emissions — less than one third of

Canada’s total — and are vulnerable to the consequences of the lion’s share of the

emissions being generated by the non-participating provinces.

[186]

What is more, any province’s refusal to implement a sufficiently stringent

GHG pricing mechanism could undermine GHG pricing everywhere in Canada

because of the risk of carbon leakage. Carbon leakage is a phenomenon by which

businesses in sectors with high levels of carbon emissions relocate to jurisdictions with

less stringent carbon pricing policies: Report of the High-Level Commission on Carbon

Prices, at p. 23. To be clear, the concern here is not with the economic extraprovincial

consequences of carbon leakage. Jurisdictions routinely compete for business, and

mere economic effects are not among the grave consequences that would support a

finding of provincial inability in the national concern context. Rather, I am referring to

the environmental consequences, and the resulting harm to humans, of carbon leakage

— the risk that any emissions reductions achieved by pricing in one province would be

offset by an increase in emissions in another province as a result of the relocation of

businesses. Thus, provincial cooperation may not result in national emissions

reductions, as businesses could simply relocate to non-cooperating provinces, leaving

Canada’s net emissions unchanged and people across Canada vulnerable to the

consequences of those emissions.

[187]

Third, a province’s failure to act or refusal to cooperate would in this case

have grave consequences for extraprovincial interests. It is uncontroversial that GHG

emissions cause climate change. It is also an uncontested fact that the effects of climate

change do not have a direct connection to the source of GHG emissions; every

province’s GHG emissions contribute to climate change, the consequences of which

will be borne extraprovincially, across Canada and around the world. And it is well-

established that climate change is causing significant environmental, economic and

human harm nationally and internationally, with especially high impacts in the

Canadian Arctic, in coastal regions and on Indigenous peoples. This includes increases

in average temperatures and in the frequency and severity of heat waves, extreme

weather events like floods and forest fires, significant reductions in sea ice and sea level

rises, the spread of life-threatening diseases like Lyme disease and West Nile virus, and

threats to the ability of Indigenous communities to sustain themselves and maintain

their traditional ways of life.

[188]

Furthermore, I reject the notion that because climate change is “an

inherently global problem”, each individual province’s GHG emissions cause no

“measurable harm” or do not have “tangible impacts on other provinces”: Alta. C.A.

reasons, at para. 324; I.F., Attorney General of Alberta, at para. 85 (emphasis in

original). Each province’s emissions are clearly measurable and contribute to climate

change. The underlying logic of this argument would apply equally to all individual

sources of emissions everywhere, so it must fail.

[189]

I note that similar arguments have been rejected by courts around the

world. In Massachusetts v. Environmental Protection Agency, 549 U.S. 497 (2007), for

instance, the majority of the U.S. Supreme Court rejected the federal government’s

argument that projected increases in other countries’ emissions meant that there was no

realistic prospect that domestic reductions in GHG emissions in the U.S. would

mitigate global climate change. The Supreme Court reasoned that “[a] reduction in

domestic emissions would slow the pace of global emissions increases, no matter what

happens elsewhere”: p. 526. Similarly, in The State of the Netherlands (Ministry of

Economic Affairs and Climate Policy) v. Stichting Urgenda, ECLI:NL:HR:2019:2007,

the Supreme Court of the Netherlands upheld findings of The Hague District Court and

The Hague Court of Appeal that “[e]very emission of greenhouse gases leads to an

increase in the concentration of greenhouse gases in the atmosphere” and thus

contributes to the global harms of climate change: para. 4.6. The Hague District Court’s

finding that “any anthropogenic greenhouse gas emission, no matter how minor,

contributes to . . . hazardous climate change” was thus confirmed on appeal: Stichting

Urgenda v. The State of the Netherlands (Ministry of Infrastructure and the

Environment), ECLI:NL:RBDHA:2015:7196, at para. 4.79. In Gloucester Resources

Limited v. Minister for Planning, [2019] N.S.W.L.E.C. 7, a New South Wales court

rejected an argument of a coal mining project’s proponent that the project’s GHG

emissions would not make a meaningful contribution to climate change. The court

noted that many courts have recognized that “climate change is caused by cumulative

emissions from a myriad of individual sources, each proportionally small relative to the

global total of GHG emissions, and will be solved by abatement of the GHG emissions

from these myriad of individual sources”: para. 516 (AustLII).

[190]

While each province’s emissions do contribute to climate change, there is

no denying that climate change is an “inherently global problem” that neither Canada

nor any one province acting alone can wholly address. This weighs in favour of a

finding of provincial inability. As a global problem, climate change can realistically be

addressed only through international efforts. Any province’s failure to act threatens

Canada’s ability to meet its international obligations, which in turn hinders Canada’s

ability to push for international action to reduce GHG emissions. Therefore, a

provincial failure to act directly threatens Canada as a whole. This is not to say that

Parliament has jurisdiction to implement Canada’s treaty obligations — it does not —

but simply that the inherently global nature of GHG emissions and the problem of

climate change supports a finding of provincial inability in this case.

[191]

I am accordingly unpersuaded by Huscroft J.A.’s observation in his

dissenting reasons in the Court of Appeal for Ontario that “[t]here are many ways to

address climate change and the provinces have ample authority to pursue them, whether

alone or in partnership with other provinces”: para. 230. The underlying premise of this

position is that the provinces will implement sufficient controls on their GHG

emissions, using GHG pricing or some other mechanism. But in the absence of a federal

law binding the provinces, there is nothing whatsoever to protect individual provinces

or the country as a whole from the consequences of one province’s decision, in

exercising its authority, to take insufficient action to control GHGs, or to take no steps

at all. In short, federal action is indispensable, and GHG pricing in particular is an

integral aspect of any scheme to reduce GHG emissions.

[192]

In my view, the principles underpinning the singleness, distinctiveness and

indivisibility inquiry clearly support a finding that the federal government has

jurisdiction over the matter of establishing minimum national standards of GHG price

stringency to reduce GHG emissions. The matter is specific, identifiable and

qualitatively different from any provincial matters. As well, federal jurisdiction is

necessitated by the provinces’ inability to address the matter as a whole through

cooperation, which exposes each province to grave harm that it is unable to prevent.

[193]

I therefore respectfully disagree with my colleague Brown. J.’s view that

the requirement of indivisibility is not met in this case. My colleague places great

weight on “the difficulty of knowing the source and physical location” of pollution in

Crown Zellerbach, asserting that because “no question arises as to physical location”

in the case at bar, indivisibility cannot be made out: paras. 380-81. Even if it is assumed

that this represents a valid distinction between Crown Zellerbach and the case at bar,

Le Dain J. clearly confined this aspect of his reasoning to “the matter of marine

pollution by the dumping of substances”: p. 437. He did not purport to lay down the

only way to determine whether indivisibility is made out. This makes sense. A matter

can be of inherent national concern even if it does not relate to something that is

“difficult” to locate. There is no “difficulty” in determining the location of the National

Capital Region, but the matter in Munro meets the requirement of indivisibility:

pp. 671-72; Re: Anti-Inflation Act, at pp. 457-58; see also Rowe J.’s reasons, at

para. 548. Likewise, there is no “difficulty” in identifying the sites of atomic energy

generation, but atomic energy, too, is a matter of inherent national concern: Ontario

Hydro; Pronto; Denison. In the instant case, the indivisibility of the matter —

establishing minimum national standards of GHG price stringency — is made out, as

my application of the two principles underpinning the singleness, distinctiveness and

indivisibility inquiry shows. This is so regardless of the “difficulty” of locating the

source or physical location of GHG emissions. “GHG emissions” are not the matter in

this case, and the “difficulty” of identifying the source and location of what a matter

relates to is not the test for indivisibility.

[194]

The analogy between this case and Crown Zellerbach is clear. Le Dain J.

emphasized the international character of marine pollution; GHG emissions represent

a truly global pollution problem that demands a coordinated international response.

Le Dain J. focused on the unique scientific characteristics of marine pollution that

distinguish it from fresh water pollution; GHG emissions, like marine pollution, are a

precisely identifiable form of pollution that can readily be scientifically distinguished

from other atmospheric pollutants.

[195]

But the case for finding that the matter is of national concern is even

stronger here than in Crown Zellerbach. This is true for two reasons. First, in the case

at bar, there is uncontested evidence of grave extraprovincial harm as a result of one

province’s failure to cooperate. In other words, this is a true interprovincial pollution

problem of the highest order. This Court’s decisions have consistently reflected the

view that interprovincial pollution is constitutionally different from local pollution and

that it may fall within federal jurisdiction on the basis of the national concern doctrine:

Interprovincial Co-operatives; Crown Zellerbach, at pp. 445-46; Hydro-Québec, at

para. 76; see also Morguard Investments, at p. 1099; Lederman, at p. 614. Second, the

proposed federal matter in the instant case relates only to the risk of non-cooperation

that gives rise to this threat of grievous extraprovincial harm. In other words, this matter

would empower the federal government to do only what the provinces cannot do to

protect themselves from this grave harm, and nothing more.

(c) Scale of Impact

[196]

At this step of the analysis, as I explained above, the court must determine

whether the matter’s scale of impact on provincial jurisdiction is acceptable having

regard to the impact on the interests that will be affected if Parliament is unable to

constitutionally address the matter at a national level. This determination is made in

light of the jurisdictional consequences of accepting the proposed matter of national

concern. I conclude that, while it is true that finding that the federal government has

jurisdiction over this matter will have a clear impact on provincial autonomy, the

matter’s impact on the provinces’ freedom to legislate and on areas of provincial life

that fall under provincial heads of power will be limited and will ultimately be

outweighed by the impact on interests that would be affected if Parliament were unable

to constitutionally address this matter at a national level.

[197]

I accept that finding that this matter is one of national concern has a clear

impact on provincial jurisdiction. It leads to the recognition of a previously unidentified

area of double aspect in which the federal law is paramount. Provinces can regulate

GHG pricing from a local perspective (e.g., under ss. 92(13) and (16) and 92A), but

legislation enacted on the basis of these provincial powers would apply concurrently in

a field also occupied by a paramount federal law that establishes minimum standards

of GHG price stringency. There is a clear impact on provincial autonomy. Provincial

governments and their residents may well wish to pursue GHG pricing standards lower

than those set by the federal government in order to protect the vitality of local

industries, or may wish to choose policies that do not involve GHG pricing.

[198]

However, I am persuaded that there is a real, and not merely nominal,

federal perspective on the fact situation of GHG pricing: Canada can regulate GHG

pricing from the perspective of addressing the risk of grave extraprovincial and

international harm associated with a purely intraprovincial approach to GHG pricing.

This is manifestly not the “same aspect of the same matter”. On the contrary, the

compelling federal interest is in doing precisely — and only — what the provinces

cannot do: protect themselves from the risk of grave harm if some provinces were to

adopt insufficiently stringent GHG pricing standards. Moreover, the matter’s impact

on the provinces’ freedom to legislate and on areas of provincial life that would fall

under provincial heads of power is qualified and limited.

[199]

First, the matter’s impact on the provinces’ freedom to legislate is minimal.

It is important to mention that the issue in this case is not the freedom of the provinces

and territories to legislate in relation to GHG emissions generally. Here, the matter is

limited to GHG pricing of GHG emissions — a narrow and specific regulatory

mechanism. Any legislation that related to non-carbon pricing forms of GHG

regulation — legislation with respect to roadways, building codes, public transit and

home heating, for example — would not fall under the matter of national concern.

[200]

Nor is the freedom of the provinces and territories to legislate in relation

to all methods of pricing GHG emissions at issue. Even where the specific regulatory

mechanism of GHG pricing is concerned, the extent to which the matter interferes with

provincial jurisdiction is strictly limited. Under the GGPPA, provinces and territories

are free to design and legislate any GHG pricing system as long as it meets minimum

national standards of price stringency. If a province wants to exceed the federal

standards, it is free to do so without fear of federal legislation rendering its legislation

inoperative, because the federal matter concerns minimum standards, not maximum

standards. If a province fails to meet the minimum national standards, the GGPPA

imposes a backstop pricing system, but only to the extent necessary to remedy the

deficiency in provincial regulation in order to address the extraprovincial and

international harm that might arise from the province’s failure to act or to set

sufficiently stringent standards. In Saskatchewan, for example, the provincially

designed industrial GHG pricing scheme applies to many industrial emitters, but Part

2 of the GGPPA applies to electricity generation and natural gas transmission pipelines,

the emissions of which Saskatchewan declined to price: see Notice Establishing

Criteria Respecting Facilities and Persons and Publishing Measures, SOR/2018-213,

ss. 2(b)(ii), 3(a) and (c)(x). The federal matter thus deals with GHG pricing stringency

in a way that relates only to the risk of non-cooperation and the attendant risk of grave

extraprovincial harm and has the ascertainable and reasonable limits required by Crown

Zellerbach so as to ensure that provincial jurisdiction is not eroded more than

necessary.

[201]

Second, the matter’s impact on areas of provincial life that would generally

fall under provincial heads of power is also limited. Although the identified matter of

national concern could arguably apply to types of fuel and to industries to which the

GGPPA does not apply at present, that matter is, crucially, restricted to standards for

GHG pricing stringency. As the majority of the Court of Appeal for Saskatchewan

pointed out, it leaves “individual consumers and businesses . . . free to choose how they

will respond, or not, to the price signals sent by the marketplace”: para. 160. Indeed,

the federal power recognized in this case is significantly less intrusive than the one at

issue in Crown Zellerbach, in which, as La Forest J. noted, the effect of finding that the

federal government has jurisdiction over ocean pollution caused by the dumping of

waste was to “virtually preven[t] a province from dealing with certain of its own public

property without federal consent”: p. 458.

[202]

Nor does the federal “supervisory” jurisdiction of the GGPPA increase the

matter’s scale of impact on provincial jurisdiction. As I explained above, the Governor

in Council’s discretion under the GGPPA is limited by the purpose of the statute, by

specific guidelines set out in it and by administrative law principles. The Governor in

Council does not have an unfettered discretion to determine whether a provincial GHG

pricing system is desirable, but is confined to determining whether it meets results-

based standards.

[203]

Moreover, the Governor in Council’s decision-making role in the GGPPA

is an incident of the flexibility the provinces retain in relation to GHG pricing within

their borders. If provincial pricing systems are to be taken into account and federal

intervention is to be limited to remedying deficiencies in those systems, the GGPPA

must include a mechanism for determining whether provincial pricing systems meet

federal standards. It would not be feasible for the statute itself to indicate which

provincial pricing systems meet federal standards, as provincial pricing schemes and

policies frequently change. The Governor in Council’s decision-making role thus

seems to be an incident of a flexible model designed to preserve provincial regulation.

Furthermore, the discretion of the Governor in Council is necessary in order to ensure

that some provinces do not subordinate or unduly burden the other provinces through

their unilateral choice of standards.

[204]

Indeed, the design of the GGPPA to ensure provincial flexibility is

consistent with the 2018 Securities Reference. In that case, the proposed law also

involved a “supervisory” aspect, given that the federal regulator’s intervention was

contingent upon there being a risk that “slips through the cracks” of a provincial scheme

that posed a threat to the Canadian economy: para. 92. The Court found that this feature

weighed in favour of constitutionality, because the statute was a “carefully tailored”

response to “this provincial incapacity”: para. 113.

[205]

In summary, although the matter has a clear impact on provincial

jurisdiction, its impact on the provinces’ freedom to legislate and on areas of provincial

life that would fall under provincial heads of power is qualified and limited.

[206]

On the whole, I am of the view that the scale of impact of this matter of

national concern on provincial jurisdiction is reconcilable with the fundamental

distribution of legislative power under the Constitution. The GGPPA puts a Canada-

wide price on carbon pollution. Emitting provinces retain the ability to legislate,

without any federal supervision, in relation to all methods of regulating GHG emissions

that do not involve pricing. They are free to design any GHG pricing system they

choose as long as they meet the federal government’s outcome-based targets. The result

of the GGPPA is therefore not to limit the provinces’ freedom to legislate, but to

partially limit their ability to refrain from legislating pricing mechanisms or to legislate

mechanisms that are less stringent than would be needed in order to meet the national

targets. Although this restriction may interfere with a province’s preferred balance

between economic and environmental considerations, it is necessary to consider the

interests that would be harmed — owing to irreversible consequences for the

environment, for human health and safety and for the economy — if Parliament were

unable to constitutionally address the matter at a national level. This irreversible harm

would be felt across the country and would be borne disproportionately by vulnerable

communities and regions, with profound effects on Indigenous peoples, on the

Canadian Arctic and on Canada’s coastal regions. In my view, the impact on those

interests justifies the limited constitutional impact on provincial jurisdiction.

(d) Conclusion on the National Concern Doctrine

[207]

In conclusion, the GGPPA is intra vires Parliament on the basis of the

national concern doctrine. Canada has adduced evidence that shows that the proposed

matter of establishing minimum national standards of GHG price stringency to reduce

GHG emissions is of clear concern to Canada as a whole and that the two principles

underpinning the “singleness, distinctiveness and indivisibility” inquiry are satisfied.

Considering the impact on the interests that would be affected if Canada were unable

to address this matter at a national level, the matter’s scale of impact on provincial

jurisdiction is reconcilable with the division of powers.

[208]

I wish to emphasize that nothing about this conclusion flows inevitably

from the fact that this matter of national concern involves a minimum national standard.

My colleague Brown J. warns that my analysis opens the floodgates to federal

“minimum national standards” in all areas of provincial jurisdiction. Respectfully, this

concern is entirely misplaced. As can be seen from the foregoing reasons, the test for

finding that a matter is of national concern is an exacting one. Canada must establish

not just that the matter is of concern to Canada as a whole, but also that it is specific

and identifiable and is qualitatively different from matters of provincial concern, and

that federal jurisdiction is necessitated by provincial inability to deal with the matter.

Each of these requirements, as well as the final scale of impact analysis, represents a

meaningful barrier to the acceptance of any matter of national concern that might be

proposed in the future.

[209]

This Court’s decision in Schneider demonstrates that where one province’s

failure to deal with health care “will not endanger the interests of another province”,

the national concern doctrine cannot apply: p. 131. This central insight from Schneider

has application beyond the field of health care, and in my view precludes the

application of the national concern doctrine to many of the fields my colleague suggests

would be vulnerable to federal encroachment as a result of the case at bar. Many fields

my colleague points to are ones in which the effects of one province’s approach are in

fact primarily felt in that province only. I note as well that this Court recently

emphasized that education is an area of exclusive provincial jurisdiction that has a

uniquely intraprovincial character: Conseil scolaire francophone de la

Colombie-Britannique v. British Columbia, 2020 SCC 13, at para. 7. Schneider itself

confirmed that “[the] view that the general jurisdiction over health matters is provincial

. . . has prevailed and is now not seriously questioned”: p. 137.

[210]

Moreover, nothing in these reasons should be understood to diminish the

significant place of s. 92(13), the provincial power over “Property and Civil Rights”,

in the Canadian constitutional order. Historically and jurisprudentially, it is well known

that this head of power serves as a means to accommodate regional and cultural

diversity in law, and that it is of particular importance in this regard to the province of

Quebec: see Citizens Insurance Co. v. Parsons (Canada) (1881), 7 App. Cas. 96, at pp.

109-12; Secession Reference, at paras. 38 and 58-60. As a result, this Court has

continued to affirm that this provincial power should be carefully protected: see, e.g.,

Re: Anti-Inflation Act, at pp. 440-41; 2018 Securities Reference, at para. 100;

Desgagnés Transport, at para. 57. In light of this, the rigorous national concern test

represents a meaningful constraint on federal power.

[211]

Even in a case in which a matter can be connected to climate change, a

truly global pollution problem with grave extraprovincial consequences, I emphasize

that much of the reasoning in this decision turns on the evidence before the Court with

respect to GHG pricing itself: the critical value of GHG pricing as a tool for the

mitigation of climate change, its nature as a distinct and limited regulatory mechanism,

how it operates across the economy, and the risk of carbon leakage. Furthermore,

finding that this matter is of national concern is appropriate only because the matter

amounts to a real, and compelling, federal perspective on GHG pricing, focused on

addressing only the well-established risk of grave extraprovincial harm, and doing so

in a way that has a qualified and limited impact on provincial jurisdiction.

VII. Validity of the Levies as Regulatory Charges

[212]

Finally, I must address Ontario’s argument that the fuel and excess

emission charges imposed by the GGPPA do not have a sufficient nexus with the

regulatory scheme to be considered constitutionally valid regulatory charges.

[213]

To be a regulatory charge, as opposed to a tax, a governmental levy with

the characteristics of a tax must be connected to a regulatory scheme: Westbank First

Nation v. British Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134, at

para. 43; 620 Connaught Ltd. v. Canada (Attorney General), 2008 SCC 7, [2008] 1

S.C.R. 131, at para. 24. In Westbank, Gonthier J. set out a two-step approach for

determining whether a governmental levy is connected to a regulatory scheme. The

first step is to identify the existence of a relevant regulatory scheme. If such a scheme

is found to exist, the second step is to establish a relationship between the charge and

the scheme itself: Westbank, at para. 44; 620 Connaught, at paras. 25-27.

[214]

Ontario does not dispute that the GGPPA creates a regulatory scheme. Its

argument instead focuses on the second step of the Westbank analysis: determining

whether the levy has a sufficient nexus with the regulatory scheme. The GGPPA does

not require that revenues collected under Parts 1 and 2 be expended in a manner

connected to the regulatory purpose of the GGPPA. Ontario argues that this undermines

the levies’ characterization as regulatory charges; in its view, the nexus requirement

cannot be met solely by showing that the regulatory purpose of a charge is to influence

behaviour. It submits that, for there to be a nexus with the regulatory scheme, the

revenues that are collected must be used to recover the cost of the scheme or be spent

in a manner connected to a particular regulatory purpose, and that a conclusion to the

contrary would undermine the “no taxation without representation” principle that

underlies s. 53 of the Constitution: A.F., at para. 97.

[215]

It is well-established that influencing behaviour is a valid purpose for a

regulatory charge. As Rothstein J. put it in 620 Connaught, a regulatory charge may be

intended to “alter individual behaviour”, in which case “the fee may be set at a level

designed to proscribe, prohibit or lend preference to a behaviour”: para. 20. Two

examples Gonthier J. mentioned in Westbank were that “[a] per-tonne charge on

landfill waste may be levied to discourage the production of waste [and that a] deposit-

refund charge on bottles may encourage recycling of glass or plastic bottles”: para. 29.

However, the case law on the required nexus in the Westbank framework for a

behaviour-modifying charge is not settled. In 620 Connaught, the Court explicitly left

the question “[w]hether the costs of the regulatory scheme are a limit on the fee revenue

generated, where the purpose of the regulatory charge is to proscribe, prohibit or lend

preference to certain conduct,” for another day: para. 48.

[216]

I agree with Strathy C.J.O. that regulatory charges need not reflect the cost

of the scheme: paras. 159-60; see also Canadian Assn. of Broadcasters v. Canada

(F.C.A.), 2008 FCA 157, [2009] 1 F.C.R. 3. As contemplated in 620 Connaught, the

amount of a regulatory charge whose purpose is to alter behaviour is set at a level

designed to proscribe, prohibit, or lend preference to a behaviour. Canada rightly

observes that limiting such a charge to the recovery of costs would be incompatible

with the design of a scheme of this nature: R.F., at para. 138. Nor must the revenues

that are collected be used to further the purposes of the regulatory scheme. Rather, as

Gonthier J. suggested in Westbank, the required nexus with the scheme will exist

“where the charges themselves have a regulatory purpose”: para. 44. Where, as in the

instant case, the charge itself is a regulatory mechanism that promotes compliance with

the scheme or furthers its objective, the nexus between the scheme and the levy inheres

in the charge itself.

[217]

This Court’s decision in Allard Contractors Ltd. v. Coquitlam (District),

[1993] 4 S.C.R. 371, is of no assistance to Ontario. Ontario seizes on an aspect of Allard

that Iacobucci J. specifically framed as an effort “to determine the scope of s. 92(9)

rather than to define ‘taxation’ as such”: p. 398. The provincial licensing power under

s. 92(9) raised specific questions about its interplay with the s. 92(2) limitation on

provincial taxation to direct, as opposed to indirect, taxation, as well as about its

relationship to other provincial heads of power. It had been argued that to give s. 92(9)

a meaning independent of the other provincial heads of power, it ought not to be limited

to raising money to support a regulatory scheme. In that context, very different from

the one in the case at bar, Iacobucci J. remarked in obiter that a finding that there was

“a power of indirect taxation in s. 92(9) extending substantially beyond regulatory costs

could have the more serious consequence of rendering s. 92(2) meaningless”: pp. 404-

5 (emphasis in original). It was unnecessary to decide the point, however, because the

levy in Allard was intended only to cover the costs of the regulatory scheme: p. 412.

[218]

It does not follow from Allard that a finding that there is a nexus with the

regulatory scheme where the levy is a regulatory mechanism would, as Ontario asserts,

“render s. 53 meaningless”: A.F., at para. 100. Section 53 codifies the principle of no

taxation without representation by requiring any bill that imposes a tax to originate with

the legislature: Eurig Estate (Re), [1998] 2 S.C.R. 565, at para. 30. Section 53 applies

expressly to taxation. The Westbank approach remains adequate for the purpose of

distinguishing between taxes and regulatory charges in order to determine whether s. 53

applies. Holding that the required nexus can be found to exist by establishing that the

charge itself is a regulatory mechanism does not open the door to disguised taxation.

Instead, in every case, the court must scrutinize the scheme in order to identify the

primary purpose of the levy on the basis of Westbank. An attempt to circumvent s. 53

by disguising a tax as a regulatory charge without a sufficient nexus to a regulatory

scheme would be colourable.

[219]

In the instant case, there is ample evidence that the fuel and excess

emission charges imposed by Parts 1 and 2 of the GGPPA have a regulatory purpose.

Ontario does not assert, nor would such an assertion be supportable, that the levies in

this case amount to disguised taxation. The GGPPA as a whole is directed to

establishing minimum national standards of GHG price stringency to reduce GHG

emissions, not to the generation of revenue. As Richards C.J.S. aptly observed,

the GGPPA “could fully accomplish its objectives . . . without raising a cent”: para. 87.

This is true of both Part 1 and Part 2. The levies imposed by Parts 1 and 2 of the GGPPA

cannot be characterized as taxes; rather, they are regulatory charges whose purpose is

to advance the GGPPA’s regulatory purpose by altering behaviour. The levies are

constitutionally valid regulatory charges.

VIII. A Final Matter

[220]

In this case, I have identified the pith and substance of the GGPPA having

regard to the statute and the regulations in force at the time of these appeals. My

colleague Rowe J. has taken this opportunity to propose a methodology for assessing

the constitutionality of regulations made under the GGPPA. Although the underlying

premise of my colleague’s comments — that regulations made pursuant to an enabling

statute must be consistent with the division of powers and further the purpose of the

statute — is uncontroversial, his speculative concern that such regulations could be

used to further industrial favouritism is neither necessary nor desirable. I would leave

the matter of the validity of regulations under the GGPPA for a future case should the

issue arise. It is not this Court’s role to express opinions about the substance, arguments

or merits of future challenges.

IX. Conclusion

[221]

In conclusion, I would answer the reference questions in the negative. The

Greenhouse Gas Pollution Pricing Act is constitutional. Accordingly, the Attorney

General of Saskatchewan’s appeal is dismissed, the Attorney General of Ontario’s

appeal is dismissed, and the Attorney General of British Columbia’s appeal is allowed.

The following are the reasons delivered by

CÔTÉ J. —

[222]

I have read the carefully crafted reasons of the Chief Justice, and I am in

agreement with his formulation of the national concern branch analysis. However, I

must respectfully part company with the Chief Justice’s ultimate conclusion that the

Greenhouse Gas Pollution Pricing Act, S.C. 2018, c. 12, s. 186 (“GGPPA” or “Act”)

is, in its current form, constitutional. In my view, the GGPPA, as presently drafted,

cannot be said to accord with the matter of national concern properly formulated by the

Chief Justice because the breadth of the discretion conferred by the Act on the Governor

in Council results in the absence of any meaningful limits on the power of the executive.

Additionally, the provisions in the GGPPA that permit the Governor in Council to

amend and override the GGPPA itself violate the Constitution Act, 1867, and the

fundamental constitutional principles of parliamentary sovereignty, rule of law, and the

separation of powers.

[223]

This Court must decide the constitutionality of the GGPPA based on the

totality of the measures it authorizes, and not simply the steps currently taken under the

Act. Thus, when I consider what the GGPPA authorizes, irrespective of whether it has

in fact been implemented, it is clear that the Act, as it is currently written, vests

inordinate discretion in the executive with no meaningful checks on fundamental

alterations of the current pricing schemes.

[224]

Although delegation of legislative power is not inherently problematic, as

discretion provides flexibility and makes it possible to overcome the practical

difficulties associated with amending provisions and enacting regulations at the

legislative level, when an Act endows a select few with the power to re-write, and thus

reengineer, a law which affects virtually every aspect of individuals’ daily lives and

provincial industrial, economic, and municipal activities, it goes too far.

[225]

I would therefore find that the Act is unconstitutional in part.

I.

The GGPPA Vests a Considerable Amount of Discretion in the Executive

A detailed review of the provisions of the Act leads to the conclusion that

[226]

a considerably high degree of discretion has been vested in the Governor in Council.

A. Part 1 of the Act

[227]

Part 1 of the Act establishes a fuel charge against certain producers,

distributors, and importers of various greenhouse gas (“GHG”) producing fuels named

in Schedule 2 (which includes aviation gasoline, aviation turbo fuel, butane, ethane,

gas liquids, gasoline, heavy and light fuel oils, kerosene, methanol, naphtha, petroleum

coke, pentanes plus, propane, coke oven gas, marketable and non-marketable natural

gas, still gas and coal) and on combustible waste. In s. 3 of the Act, the critical feature

of the fuel levy — that being, what fuels are covered by the Act — is so open-ended,

allowing any substance, if prescribed by the Governor in Council, to fall within the

ambit of the fuel charge regime:

combustible waste means

(a) tires or asphalt shingles whether in whole or in part; or

(b) a prescribed substance, material or thing. (déchet combustible)

. . .

fuel means

(a) a substance, material or thing set out in column 2 of any table in

Schedule 2, other than

(i) combustible waste,

(ii) a substance, material or thing that is prepackaged in a factory

sealed container of 10 L or less, or

(iii) a prescribed substance, material or thing; and

(b) a prescribed substance, material or thing. (combustible)

[228]

The operative provisions of Part 1 similarly prescribe vast legislative law-

making power to the executive such that the very nature of the regime can be altered.

For example:

Covered facility of a person

5 For the purposes of this Part, a covered facility is a covered facility of a

person if

. . .

(b) the person is a prescribed person, a person of a prescribed class or a

person meeting prescribed conditions in respect of the covered facility.

. . .

Delivery of marketable natural gas — distribution system

14 For the purposes of this Part, if marketable natural gas is delivered to a

particular person by means of a distribution system, the person that is

considered to deliver the marketable natural gas is

. . .

(b) if prescribed circumstances exist or prescribed conditions are met,

the person that is a prescribed person, a person of a prescribed class or

a person meeting prescribed conditions.

. . .

Charge — regulations

26 Subject to this Part, a prescribed person, a person of a prescribed class

or a person meeting prescribed conditions must pay to Her Majesty in right

of Canada a charge in respect of a type of fuel or combustible waste in the

amount determined in prescribed manner if prescribed circumstances exist

or prescribed conditions are met. The charge becomes payable at the

prescribed time.

Charge not payable — regulations

27 A charge under this Part in respect of a type of fuel or combustible waste

is not payable

(a) by a prescribed person, a person of a prescribed class or a person

meeting prescribed conditions; or

(b) if prescribed circumstances exist or prescribed conditions are met.

. . .

Charge amount — mixture

40(2) Despite subsection (1), if a manner is prescribed in respect of a

mixture that is deemed to be fuel of a prescribed type under

subsection 16(2), the amount of a charge payable under this Division in

respect of such a mixture is equal to the amount determined

in prescribed manner.

Charge amount — regulations

40(3) Despite subsection (1), if prescribed circumstances exist or

prescribed conditions are met, the amount of a charge payable under this

Division in respect of fuel and a listed province is equal to the amount

determined in prescribed manner.

. . .

Charge amount — regulations

41(2) Despite subsection (1), if prescribed circumstances exist or

prescribed conditions are met, the amount of a charge payable in respect of

combustible waste and a listed province is equal to the amount determined

in prescribed manner.

. . .

Amount of rebate — regulations

47(3) Despite subsection (2), if prescribed circumstances exist or

prescribed conditions are met, the amount of a rebate payable under this

section is equal to the amount determined in prescribed manner.

[229]

The full breadth of executive powers can be seen most notably within

ss. 166 and 168 of the Act. Section 166(1)(a) states that the Governor in Council may

make regulations “prescribing anything that, by this Part, is to be prescribed or is to be

determined or regulated by regulation”. The only limit whatsoever on s. 166’s

expansive regulation-making powers is that s. 166(3) stipulates that in making a

regulation under subsection (2) — that is, amending Part 1 of Schedule 1 to modify the

list of provinces where the fuel levy is payable — “the Governor in Council shall take

into account, as the primary factor, the stringency of provincial pricing mechanisms for

greenhouse gas emissions”. No such factor applies to the Governor in Council’s

regulation-making powers under Part 1’s provisions. Most importantly, by virtue of

s. 166(4), the executive has a wholly-unfettered ability to amend Part 1 of the Act:

166(4) The Governor in Council may, by regulation, amend Schedule 2

respecting the application of the fuel charge under this Part including by

adding, deleting, varying or replacing a table.

[230]

Sections 168(2) and 168(3) also allow the Governor in Council to make

and amend regulations in relation to the fuel charge system, its application, and its

implementation. These wide-ranging powers set forth a wholly-unfettered grant of

broad discretion to amend Part 1 of the Act:

168(2) The Governor in Council may make regulations, in relation to the

fuel charge system,

(a) prescribing rules in respect of whether, how and when the fuel

charge system applies and rules in respect of other aspects relating to

the application of that system, including rules deeming, in specified

circumstances and for specified purposes, the status of anything to be

different than what it would otherwise be, including when an amount

under this Part became due or was paid, when fuel or a substance,

material or thing was delivered, how and when an amount under this

Part is required to be reported and accounted for and when any period

begins and ends;

(b) prescribing rules in respect of whether, how and when a change

in a rate, set out in any table in Schedule 2 for a type of fuel and for a

province or area, applies and rules in respect of a change to another

parameter affecting the application of the fuel charge system in

relation to such a fuel or province or area, including rules deeming, in

specified circumstances and for specified purposes, the status of

anything to be different than what it would otherwise be, including

when an amount under this Part became due or was paid, when fuel

or a substance, material or thing was delivered, how and when an

amount under this Part is required to be reported and accounted for

and when any period begins and ends;

(c) prescribing rules in respect of whether, how and when a change

to the provinces or areas listed in Part 1 of Schedule 1 or referenced

in Schedule 2 applies and rules in respect of a change to another

parameter affecting the application of the fuel charge system in

relation to a province or area or to a type of fuel, including rules

deeming, in specified circumstances and for specified purposes, the

status of anything to be different than what it would otherwise be,

including when an amount under this Part became due or was paid,

when fuel or a substance, material or thing was delivered, how and

when an amount under this Part is required to be reported and

accounted for and when any period begins and ends;

(d) if an amount is to be determined in prescribed manner in relation

to the fuel charge system, specifying the circumstances or conditions

under which the manner applies;

(e) providing for rebates, adjustments or credits in respect of the fuel

charge system;

(f) providing for rules allowing persons, which elect to have those

rules apply, to have the provisions of this Part apply in a manner

different from the manner in which those provisions would otherwise

apply, including when an amount under this Part became due or was

paid, when fuel or a substance, material or thing was delivered, how

and when an amount under this Part is required to be reported or

accounted for and when any period begins and ends;

(g) specifying circumstances and any terms or conditions that must

be met for the payment of rebates in respect of the fuel charge system;

(h) prescribing amounts and rates to be used to determine any rebate,

adjustment or credit that relates to, or is affected by, the fuel charge

system, excluding amounts that would otherwise be included in

determining any such rebate, adjustment or credit, and specifying

circumstances under which any such rebate, adjustment or credit must

not be paid or made;

(i) respecting information that must be included by a specified

person in a written agreement or other document in respect of

specified fuel or a specified substance, material or thing and

prescribing charge-related consequences in respect of such fuel,

substance, material or thing, and penalties, for failing to do so or for

providing incorrect information;

(j) deeming, in specified circumstances, a specified amount of

charge to be payable by a specified person, or a specified person to

have paid a specified amount of charge, for specified purposes, as a

consequence of holding fuel at a specified time;

(k) prescribing compliance measures, including anti-avoidance

rules; and

(l) generally to effect the transition to, and implementation of, that

system in respect of fuel or a substance, material, or thing and in

respect of a province or area.

[231]

Most notably, s. 168(4) of the Act states that in the event of a conflict

between the statute enacted by Parliament and the regulations made by the executive,

“the regulation prevails to the extent of the conflict”. This breathtaking power

circumvents the exercise of law-making power by the legislative branch by permitting

the executive to amend by regulation the very statute which authorizes the regulation.

Section 168(4), along with ss. 166(2) and 166(4), all constitute what are known as

“Henry VIII clauses”. Their name, Henry VIII clauses, is inspired by the King whose

lust for power included the Statute of Proclamations (An Act that Proclamations made

by the King shall be obeyed (Eng.), 1539, 31 Hen. 8, c. 8), which elevated the King’s

proclamations to have the same legal force as Acts of Parliament (J. W. F. Allison,

“The Westminster Parliament’s Formal Sovereignty in Britain and Europe from a

Historical Perspective” (2017), 34 Journal of Constitutional History 57, at pp. 62-63).

B. Part 2 of the Act

[232]

The output-based pricing system (“OBPS”) created under Part 2 of the Act

exempts certain industrial enterprises, defined as “covered facilities”, from Part 1’s fuel

charge regime. I have concerns about the Chief Justice’s assertion that “no aspect of

the discretion provided for in Part 2 permits the Governor in Council to regulate GHG

emissions broadly or to regulate specific industries in any way other than by setting

GHG emissions limits and pricing excess emissions across the country” (para. 76). In

my view, and with respect, it is clear from a review of Part 2’s provisions that the broad

powers accorded to the executive allow for this very result.

[233]

Section 192 contains a Henry VIII clause and empowers the Governor in

Council to make regulations for a variety of matters, including regulations:

(a) defining facility;

(b) respecting covered facilities, including the circumstances under

which they cease to be covered facilities;

(c) allowing for the determination of the persons that are responsible

for a facility or covered facility;

(d) respecting designations and cancellations of designations under

section 172;

(e) respecting compliance periods and the associated regular-rate

compensation deadlines and increased-rate compensation deadlines;

(f) respecting the reports and verifications referred to in section 173

and subsections 176(2) and 177(2);

(g) respecting greenhouse gas emissions limits referred to in

sections 173 to 175, subsection 178(1), section 182 and

subsection 183(1);

(h) respecting the quantification of greenhouse gases that are emitted

by a facility;

(i) respecting the circumstances under which greenhouse gases are

deemed to have been emitted by a facility;

(j) respecting the methods, including sampling methods, and

equipment that are to be used to gather information on greenhouse gas

emissions and activities related to those emissions;

(k) respecting the compensation referred to in sections 174 and 178;

(l) respecting compliance units, including transfers of compliance

units, the circumstances under which transfers of compliance units are

prohibited and the recognition of units or credits issued by a person

other than the Minister as compliance units;

(m) respecting the tracking system referred to in section 185 and the

accounts in that system;

(n) providing for user fees;

(o) respecting the rounding of numbers;

(p) respecting the retention of records referred to in section 187; and

(q) respecting the correction or updating of information that has been

provided under this Division.

[234]

Additionally, a number of provisions in Part 2 allow the executive, in

accordance with the regulations crafted by said executive, to: designate a facility as a

covered facility, thus making it exempt from paying the fuel charge (s. 172(1)), cancel

the designation of a covered facility (s. 172(3)), suspend or revoke compliance units

(s. 180(1)), recover compensation owing in compliance units (s. 182), or close an

account (s. 186(3)). The sole limit on the executive’s expansive discretion found in

Part 2, similar to Part 1, is in s. 189(2); when amending Part 2 of Schedule 1 to modify

the list of provinces where the OBPS applies, “the Governor in Council shall take into

account, as the primary factor, the stringency of provincial pricing mechanisms for

greenhouse gas emissions”. Again, as in Part 1, no such factor applies to the Governor

in Council’s regulation-making powers under Part 2’s provisions.

[235]

While the Governor in Council’s powers in this regard are ostensibly

exercisable to allow for ongoing review, I am in agreement with both Justices Brown

and Rowe that Part 2’s “skeletal” framework accords the executive vast discretion to

unilaterally set standards on an industry-by-industry basis, creating the potential for

differential treatment of industries at the executive’s whim.

II. “Minimum” Standards Are Set By the Executive, Not the Act

[236]

As noted above, I agree with the Chief Justice that the use of minimum

national standards of price stringency to reduce GHG emissions is legally viable as a

matter of national concern. However, the Act, as it is currently written, cannot be said

to establish national standards of price stringency because there is no meaningful limit

to the power of the executive. In my view, it is not the Act, but the executive, who sets,

constrains, or expands, the standards.

[237]

The legislative decision to transfer law and policy-making power to the

executive is central to the contours of the GGPPA. In his article “The Case for a

Canadian Nondelegation Doctrine” (2019), 52 U.B.C. L. Rev. 817, (Alyn)

James Johnson, a constitutional and administrative law scholar, notes the deleterious

consequences of this excessive delegation:

Legislatures are high-profile bodies where law and policy making on

contentious issues can occur with a degree of public awareness, scrutiny,

and input. Courts and executive bodies, on the other hand, while

themselves institutionally distinct, both lack the open and broadly-

deliberative character that gives legislatures their unique position in a

democratic society. [Footnote omitted; pp. 825-26.]

This excessively broad delegation of power removes the regulation of GHGs from the

legitimizing forum of the legislature and places it into the hands of the few.

[238]

The Chief Justice emphasizes that regulation-making power is conscribed

to the statutory purpose of reducing GHG emissions through GHG pricing — such as

imposing a fuel charge and industrial GHG emissions pricing regimes. But, in my view,

this is not a meaningful limitation to the executive’s power. As Justice Brown has

helpfully outlined, rather than establishing minimum national standards, Part 2 of the

Act empowers the executive to establish variable and inconsistent standards on an

industry-by-industry basis. For instance, the executive could decide to impose such

strict limits on the fossil fuel or potash industries, both heavy emitters of GHG

emissions, that the industries would be decimated. According to the majority’s

reasoning, this example, regardless of its improbability, would fulfill the statutory

purpose of reducing GHG emissions through GHG pricing and therefore be a valid use

of the executive’s regulatory powers accorded by the GGPPA. This cannot be so.

[239]

I recognize that in response, one may argue that Canadian citizens can

simply make their displeasure known at election time. However, the fact that the

executive is permitted to place a number of conditions on individuals and industries at

any time, and is moreover allowed to revise those conditions at any time to any extent,

is untenable. This results in provinces having applicable regimes one day, and being

under the federal scheme the next. The meaningful check on the legislation ought to be

the separation of powers analysis, not simply a further delegation to the ballot box.

[240]

The Act, as it is currently written, employs a discretionary scheme that

knows no bounds. While I agree with the Chief Justice’s reasons that a matter which is

restricted to minimum national GHG pricing stringency standards properly fits within

federal authority, the Act does not reflect this crucial restriction. Given the boundless

discretion that is contained within the provisions, including the ability to expand the

ambit of both Parts to fundamentally change the nature of the fuel charge regime or

target specific industries, the Act cannot be said to accord with the matter.

III. Constitutional Restrictions on Delegated Power

[241]

Moreover, I am of the view that certain parts of the Act are so inconsistent

with our system of democracy that they are independently unconstitutional. I explain

why below.

[242]

Sections 166(2), 166(4) and 192 all confer on the Governor in Council the

power to amend parts of the Act. Section 168(4) confers the power to adopt secondary

legislation that is inconsistent with Part 1 of the Act. Scholars have long warned that

executive power to amend or repeal provisions in primary legislation raises serious

constitutional concerns (see Hewart L.C.J., The New Despotism (1929); D. J. Mullan,

“The Role of the Judiciary in the Review of Administrative Policy Decisions: Issues of

Legality”, in M. J. Mossman and G. Otis, eds., The Judiciary as Third Branch of

Government: Manifestations and Challenges to Legitimacy (1999), 313, at p. 375;

L. Neudorf, “Reassessing the Constitutional Foundation of Delegated Legislation in

Canada” (2018), 41 Dal. L.J. 519, at p. 545; Johnson; see also M. Mancini, “The Non-

Abdication Rule in Canadian Constitutional Law” (2020), 83 Sask. L. Rev. 45). The

time has come to acknowledge that clauses that purport to empower a body other than

Parliament to amend primary legislation are contrary to ss. 17 and 91 of the

Constitution Act, 1867. Therefore, ss. 166(2), 166(4), 168(4) and 192 of the GGPPA

are unconstitutional.

A. The Architecture of the Constitution of Canada

[243]

The Constitution of Canada is a “comprehensive set of rules and principles

which are capable of providing an exhaustive legal framework for our system of

government” (Reference re Secession of Quebec, [1998] 2 S.C.R. 217, at para. 32). The

rules and principles that compose the Constitution of Canada “emerge from an

understanding of the constitutional text itself, the historical context, and previous

judicial interpretations of constitutional meaning” (Secession Reference, at para. 32).

They include both written and unwritten elements (Reference re Remuneration of

Judges of the Provincial Court of Prince Edward Island, [1997] 3 S.C.R. 3, at para. 92;

Secession Reference, at para. 32). The question here is whether these rules and

principles permit Parliament to authorize the Governor in Council to amend an Act of

Parliament.

[244]

One of the core features of the Constitution of Canada is the identification

and definition of three constituent elements of the state: the executive, the legislative

and the judicial (Reference re Senate Reform, 2014 SCC 32, [2014] 1 S.C.R. 704, at

para. 23; Provincial Judges Reference, at para. 108). The Constitution Act, 1867, plays

a critical role in defining these three constituent elements. Part III of the Constitution

Act, 1867, defines the Executive Power, Part IV the Legislative Power and Part VII the

Judicature. Additionally, Part V establishes the executive and legislative powers for

provinces and Part VI establishes the distribution of legislative powers between the

Parliament of Canada and provincial legislatures.

[245]

Constitutional documents must be interpreted in a broad and purposive

manner, informed by not only the proper linguistic, philosophic and historical contexts

but also by the foundational principles of the Constitution (Senate Reference, at

para. 25; Hunter v. Southam Inc., [1984] 2 S.C.R. 145, at pp. 155-56; R. v. Big M Drug

Mart Ltd., [1985] 1 S.C.R. 295, at p. 344). They must also be read in light of the broader

architecture of the Constitution (Senate Reference, at para. 26; Secession Reference, at

para. 50; OPSEU v. Ontario (Attorney General), [1987] 2 S.C.R. 2, at p. 57).

[246]

We must thus begin with the actual text of the Constitution Act, 1867.

Under Part IV, the first provision declares that “[t]here shall be One Parliament for

Canada, consisting of the Queen, an Upper House styled the Senate, and the House of

Commons” (s. 17). Under Part VI, the first provision provides:

91. It shall be lawful for the Queen, by and with the Advice and Consent

of the Senate and House of Commons, to make Laws for the Peace, Order,

and good Government of Canada, in relation to all Matters not coming

within the Classes of Subjects by this Act assigned exclusively to the

Legislatures of the Provinces; and for greater Certainty, but not so as to

restrict the Generality of the foregoing Terms of this Section, it is hereby

declared that (notwithstanding anything in this Act) the exclusive

Legislative Authority of the Parliament of Canada extends to all Matters

coming within the Classes of Subjects next hereinafter enumerated; that is

to say . . . .

[247]

A linguistic or ordinary and grammatical reading of these sections leads

me to conclude that they simultaneously confer the federal legislative power upon the

Parliament of Canada and constrain how the Parliament of Canada may exercise the

legislative power. Section 17 begins by emphasizing “[t]here shall be One Parliament

for Canada”, meaning that all of the legislative power conferred upon the federal state

shall reside in a single Parliament. Then comes the constraint on how legislative power

must be exercised, arising from the decision of the Fathers of Confederation to

“particularize the participants in the law making process” (Re: Authority of Parliament

in relation to the Upper House, [1980] 1 S.C.R. 54, at p. 74). Sections 17 and 91 both

affirm that the authority to legislate is exclusively exercisable by the Queen, with the

advice and consent of the Senate and the House of Commons. This means, at the federal

level, every exercise of legislative power — every enactment, amendment and repeal

of a statute — must have the consent of all three elements of Parliament: the Queen,

the Senate and the House of Commons. In contrast, under Part III “Executive Power”,

s. 9 vests the “Executive Government and Authority of and over Canada” exclusively

upon the Queen alone.

[248]

Our case law also supports this interpretation. In Hodge v. The Queen

(1883), 9 App. Cas. 117, the Privy Council held that a province could lawfully delegate

the power to set regulations regarding liquor licensees to License Commissioners.

However, Sir Barnes Peacock for the panel noted that “[i]t is obvious that such an

authority is ancillary to legislation, and without it an attempt to provide for varying

details and machinery to carry them out might become oppressive, or absolutely fail”

and that there were an “abundance of precedents for this legislation, entrusting a limited

discretionary authority to others” (p. 132 (emphasis added)). He also noted that the

provincial legislature “retains its powers intact, and can, whenever it pleases, destroy

the agency it has created and set up another, or take the matter directly into his own

hands” (p. 132).

[249]

In In re Initiative and Referendum Act, [1919] A.C. 935, the Privy Council

reviewed the constitutionality of Manitoba’s Initiative and Referendum Act, S.M. 1916,

c. 59. This Act provided that laws may be made and repealed by referendum, and that

such laws would have the same effect as laws made by an Act of the Legislature (s. 7).

The Manitoba Court of Appeal had found that s. 92 of the British North America Act,

1867 (now the Constitution Act, 1867) vested the power of law making exclusively

with the Legislature and the Legislature could not confer that power upon any other

body (Re The Initiative and Referendum Act (1916), 27 Man. R. 1).

[250]

For the Privy Council, Viscount Haldane found that “[t]he language of s. 92

is important. That section commences by enacting that ‘in such Province the

Legislature may exclusively make laws in relation to matters’ coming within certain

classes of subjects” (p. 943). Although he went on to dismiss the appeal on the basis

that Manitoba did not have jurisdiction to interfere with the office of Lieutenant-

Governor, in “a deliberate and important obiter” (OPSEU, at p. 47), Viscount Haldane

continued on to discuss the limits of legislative power:

Sect. 92 of the Act of 1867 entrusts the legislative power in a Province to

its Legislature, and to that Legislature only. No doubt a body, with a power

of legislation on the subjects entrusted to it so ample as that enjoyed by a

Provincial Legislature in Canada, could, while preserving its own capacity

intact, seek the assistance of subordinate agencies, as had been done when

in Hodge v. The Queen, the Legislature of Ontario was held entitled to

entrust to a Board of Commissioners authority to enact regulations relating

to taverns; but it does not follow that it can create and endow with its own

capacity a new legislative power not created by the Act to which it owes

its own existence. [Emphasis added; footnote omitted; p. 945.]

[251]

In Re: Authority of Parliament in relation to the Upper House, the Court

reiterated this finding that “s. 92 of the Act vests the power to make or repeal laws

exclusively in the Legislature and that it did not contemplate the creation of a new

legislative body to which the Legislature could delegate its powers of legislation or

with which it would share them” (p. 72).

[252]

In Reference re Manitoba Language Rights, [1985] 1 S.C.R. 721, this Court

affirmed the Constitution requires that each part of a legislature — in the case of

Manitoba, both the Legislative Assembly and the Lieutenant-Governor — consent to a

bill in order to validly exercise legislative power. Section 4(1) of An Act Respecting the

Operation of Section 23 of the Manitoba Act in Regard to Statutes, S.M. 1980, c. 3,

provided that statutes could be enacted in one official language and subsequently be

translated into the other official language. It authorized the translation to merely be

deposited with the Clerk of the House in order to become law. The Court found this to

be “an unconstitutional attempt to interfere with the powers of the

Lieutenant-Governor. Royal assent is required of all enactments” (Manitoba Language

Rights, at p. 777).

[253]

There is, however, one authority that presents a different view of

Parliament’s ability to delegate legislative power. In Re George Edwin Gray (1918),

57 S.C.R. 150, a majority of the Supreme Court upheld an Order in Council which

contradicted a statute. Re Gray was an application for habeas corpus. George Gray was

a young farmer who had been exempted from military service under The Military

Service Act, 1917, S.C. 1917, c. 19, because of his farming duties. Section 6 of The

War Measures Act, 1914, S.C. 1914, c. 2, provided that “[t]he Governor in Council

shall have power to do and authorize such acts and things, and to make from time to

time such orders and regulations, as he may by reason of the existence of real or

apprehended war . . . deem necessary or advisable for the security, defence, peace,

order and welfare of Canada”. Section 13(5) of The Military Service Act, 1917,

correspondingly provided: “Nothing in this Act contained shall be held to limit or

affect . . . the powers of the Governor in Council under The War Measures Act, 1914.”

[254]

On April 19, 1918, the Senate and House of Commons passed a joint

resolution: “That in the opinion of this House, it is expedient that regulations respecting

Military Service shall be made and enacted by the Governor in Council in manner and

form and in the words and figures following, that is to say . . .” (Votes and Proceedings

of the House of Commons of the Dominion of Canada, No. 22, 1st Sess., 13th Parl.,

April 19, 1918, at p. 242; Journals of the Senate of Canada, vol. 54, 1st Sess.,

13th Parl., April 19, 1918, at p. 100). The resolution went on to repeat verbatim a set

of regulations that the Governor in Council made the next day. These regulations

altered the exemptions from military service such that Mr. Gray was no longer exempt.

The Order in Council’s military service requirements were contrary to The Military

Service Act, 1917.

[255]

The sole question before the Court was whether there was authority for the

Order in Council nullifying the exemption. Writing in the majority, Fitzpatrick C.J.

found that while it was argued that Parliament alone may make laws, Parliament could

delegate legislative powers so long as it did not amount to abdicating its role (Re Gray,

at pp. 156-57). He then turned to The War Measures Act, 1914, to determine whether

the Order in Council was intra vires. The War Measures Act, 1914, did not expressly

authorize the Governor in Council to promulgate orders inconsistent with statutes, but

according to Fitzpatrick C.J. express language was not necessary:

It seems to me obvious that parliament intended, as the language used

implies, to clothe the executive with the widest powers in time of danger.

Taken literally, the language of the section contains unlimited powers.

Parliament expressly enacted that, when need arises, the executive may for

the common defence make such orders and regulations as they may deem

necessary or advisable for the security, peace, order and welfare of Canada.

The enlightened men who framed that section, and the members of

parliament who adopted it, were providing for a very great emergency, and

they must be understood to have employed words in their natural sense,

and to have intended what they have said. [Emphasis added; pp. 158-59.]

[256]

In finding that the statute conferred unlimited power, Fitzpatrick C.J. was

most certainly influenced by the urgency of war: “Our legislators were no doubt

impressed in the hour of peril with the conviction that the safety of the country is the

supreme law against which no other law can prevail. It is our clear duty to give effect

to their patriotic intention” (p. 160 (emphasis added)). Justices Duff and Anglin were

similarly concerned, with Anglin J. even noting that thousands of men had already been

drafted and were on their way to Europe under the authority of this Order in Council

(pp. 169, 174 and 180). Were it not for the urgency of war, it is difficult to see any

justice agreeing to permit the Governor in Council to exercise what appears to be

unlimited power, as such power is the very antithesis to the rule of law. As

Lord Bingham wrote:

The rule of law does not require that official or judicial decision-makers

should be deprived of all discretion, but it does require that no discretion

should be unconstrained so as to be potentially arbitrary. No discretion may

be legally unfettered.

(The Rule of Law (2010), at p. 54)

[257]

In contrast, the dissenting judges refused to accept the “bald proposition”

that The Military Service Act, 1917, “was liable to be repealed or nullified by an order

in council” (Re Gray, at p. 164). Even with the emergency of war, overruling statutes

by Order in Council was not cognizable, “such conceptions of law as within the realm

of legislation assigned by the ‘British North America Act’ to the Dominion have no

existence” (p. 165).

[258]

The Chief Justice cites Re Gray as establishing the constitutionality of

Henry VIII clauses (para. 85). With great respect, I do not read Re Gray as being

conclusive of the constitutionality of Henry VIII clauses. First, the comments of the

majority justices in Re Gray, particularly with respect to the unlimited powers of the

Governor in Council, demonstrate that their findings are not in accord with our

contemporary understandings of core constitutional principles. The justices in Re Gray

were clearly moved by the great emergency of war. In the case before us, Parliament

did not pass the impugned legislation under the emergency branch. Second, Re Gray is

distinguishable from the present case in that all three of the bodies charged under ss. 17

and 91 with the exclusive authority to make legislation agreed with the Order in

Council. Although not passed as an Act of Parliament, the joint resolution of the Senate

and House of Commons along with the Order in Council may adequately meet the

demands of ss. 17 and 91 in the urgent situation of war. There was no consent of the

House of Commons or Senate to the regulations promulgated by the Governor in

Council under the GGPPA. Third, this reading is inconsistent with our most recent

pronouncement on delegation of law-making powers.

[259]

The Chief Justice also cites Reference as to the Validity of the Regulations

in Relation to Chemicals, [1943] S.C.R. 1, and R. v. Furtney, [1991] 3 S.C.R. 89, as

cases relying upon the findings in Re Gray (Chief Justice’s reasons, at para. 85).

Neither of these cases concerned Henry VIII clauses. In the Chemicals Reference, the

Governor in Council had established various boards to assist with the Second World

War effort. The question at issue was whether the Governor in Council could delegate

its power under The War Measures Act, 1914, to these other bodies. Not only was there

no Henry VIII clause at issue, but the Court unanimously ruled that part of the Order

in Council was ultra vires for being contrary to the enabling statute (pp. 7, 21, 27, 32

and 37). Despite the broad statements about Parliament’s ability to delegate

“legislative” power in time of emergency, Duff C.J. also recognized that the British

North America Act, 1867, may impose limits upon Parliament’s ability to commit

legislative powers to the executive (p. 10). I use the word “legislative” in quotation

marks because Duff C.J. spoke of actions that are legislative in character (p. 12). For

the purpose of the present appeals, I define legislative power more narrowly, referring

specifically to the formal power to enact, amend or repeal an Act of Parliament. On this

definition, no legislative power was at issue in the Chemicals Reference.

[260]

Furtney is part of a different line of jurisprudence regarding inter-

governmental delegation that, in my view, only lends support to the unconstitutionality

of Henry VIII clauses. In Attorney General of Nova Scotia v. Attorney General of

Canada, [1951] S.C.R. 31, this Court held that Parliament could not delegate its

legislative powers to a provincial legislature and similarly, the provincial legislature

could not delegate its legislative powers to Parliament. Although Rinfret C.J.

distinguished this from cases where a delegation is made to a body subordinate to

Parliament, his focus on the word “exclusively” in both ss. 91 and 92, along with the

lack of an express delegation power, supports my reading of ss. 17 and 91 (pp. 34-35).

In the Reference re Pan-Canadian Securities Regulation, 2018 SCC 48, [2018] 3

S.C.R. 189, we affirmed that the Constitution Act, 1867, prohibits Parliament from

delegating legislative powers to another legislature (para. 75). Throughout the

judgment we repeatedly emphasize the ability of Parliament to delegate the power to

make “subordinate” regulations (paras. 73 and 75-76 (emphasis in original)) or

exercise “administrative” powers (paras. 123 and 125 (emphasis in original)). At no

point do we support the delegation of primary legislative authority.

[261]

I thus cannot take Re Gray to be conclusive of the issue. I turn now to the

fundamental principles of the Constitution which further support my reading of ss. 17

and 91.

B. Fundamental Principles of the Constitution of Canada

[262]

This Court’s recent jurisprudence demonstrates that the unwritten

principles of our Constitution help to inform the written text (Manitoba Language

Rights, at pp. 750-51; Secession Reference, at para. 53; Provincial Judges Reference,

at paras. 94-95 and 104; British Columbia v. Imperial Tobacco Canada Ltd., 2005 SCC

49, [2005] 2 S.C.R. 473, at paras. 44 and 57; Babcock v. Canada (Attorney General),

2002 SCC 57, [2002] 3 S.C.R. 3, at para. 54).

[263]

In my view, there are three fundamental principles that must inform the

interpretation of ss. 17 and 91: parliamentary sovereignty, rule of law and the

separation of powers.

(1) Parliamentary Sovereignty

[264]

Parliamentary sovereignty is a foundational principle in the Westminster

system of government that the Constitution of Canada employs. Parliamentary

sovereignty is generally thought to mean that Parliament has “the right to make or

unmake any law whatever” (A. V. Dicey, Introduction to the Study of the Law of the

Constitution (10th ed. 1959), at pp. 39-40). Of course, in Canada the sovereignty of

Parliament has always been qualified by the written constitution (Pan-Canadian

Securities Reference, at para. 56). For that reason, the Court has said that it may be

more useful to refer to our system of government as one of constitutional supremacy,

rather than parliamentary supremacy (Secession Reference, at para. 72). Nonetheless,

parliamentary sovereignty remains an important constitutional principle, as absent

constitutional restraint, Parliament may make or unmake any law.

[265]

At first glance, parliamentary sovereignty supports Parliament’s ability to

delegate whatever they want to whomever they wish. If Parliament can make or

unmake any law whatever, then Parliament can make a law empowering the Governor

in Council to amend Acts of Parliament. However, this is not the case. Parliamentary

sovereignty contains both a positive and negative aspect. The positive aspect is, as we

have seen, that Parliament has the ability to create any law. The negative aspect,

however, is that no institution is competent to override the requirements of an Act of

Parliament. Dicey covered both of these aspects in his definition:

The principle of Parliamentary sovereignty means neither more nor less

than this, namely, that Parliament thus defined has, under the English

constitution, the right to make or unmake any law whatever; and, further,

that no person or body is recognised by the law of England as having a

right to override or set aside the legislation of Parliament. [Footnote

omitted; pp. 39-40.]

[266]

It is this negative aspect of parliamentary sovereignty that Henry VIII

clauses run afoul of. Henry VIII clauses “give the executive the authority to override

the requirements of primary legislation and thereby directly violate the principle of

parliamentary sovereignty” (A. Tucker, “Parliamentary Scrutiny of Delegated

Legislation”, in A. Horne and G. Drewry, eds., Parliament and the Law (2018), 347, at

p. 359). In the 2010 Mansion House Speech to the Lord Mayor of London, the Lord

Chief Justice of England and Wales agreed, declaring that “proliferation of clauses like

these will have the inevitable consequence of yet further damaging the sovereignty of

Parliament and increasing yet further the authority of the executive over the

legislature . . . Henry VIII clauses should be confined to the dustbin of history”

(Lord Judge, July 13, 2010 (online), at p. 6; see also Lord Judge, “Ceding Power to the

Executive; the Resurrection of Henry VIII”, speech delivered at King’s College

London, April 12, 2016 (online), at p. 3).

[267]

In Pan-Canadian Securities Reference, this Court emphasized the negative

aspect of parliamentary sovereignty in its definition of parliamentary sovereignty:

“. . . the legislature has the exclusive authority to enact, amend, and repeal any law as

it sees fit, and . . . there is no matter in respect of which it may not make laws” (para. 54

(emphasis in original)). The Court unanimously found that it was consistent with

parliamentary sovereignty to limit Parliament’s ability to delegate its legislative powers

to provincial legislatures:

To put it simply: while Parliament or a provincial legislature may

delegate the regulatory authority to make subordinate laws (like binding

rules and regulations) in respect of matters over which it has jurisdiction to

another person or body, it is nevertheless barred from transferring its

primary legislative authority — that is, its authority to enact, amend and

repeal statutes — with respect to a particular matter over which it has

exclusive constitutional jurisdiction to a legislature of the other level of

government. [Emphasis added; para. 76.]

[268]

Even if one were to reject the idea that parliamentary sovereignty entails

accepting that no other body can enact, amend or repeal statutes, the concept of

parliamentary sovereignty has other inherent limitations. For instance, in order for

Parliament to be sovereign it cannot be limited by the actions of previous Parliaments

and therefore “neither Parliament nor the legislatures can, by ordinary legislation, fetter

themselves against some future legislative action” (Reference re Securities Act, 2011

SCC 66, [2011] 3 S.C.R. 837, at para. 119). Similarly, logic limits Parliament from

achieving two contradictory purposes simultaneously. For instance, Parliament cannot

create a body of limited jurisdiction and simultaneously insulate that body from judicial

review because “it is a contradiction in terms to create a tribunal with limited

jurisdiction and unlimited power to determine such limit at its own will and

pleasure — such a tribunal would be autocratic, not limited” (R. v. Shoreditch

Assessment Committee, [1910] 2 K.B. 859 (C.A.), at p. 880). Henry VIII clauses create

a contradiction within an Act by simultaneously requiring the executive to do

something and authorizing the executive to defy that requirement. For instance, in the

GGPPA, s. 168(2) empowers the Governor in Council to regulate several specific

subjects relating to the fuel charge, such as “providing for rebates, adjustments or

credits in respect of the fuel charge system” (s. 168(2)(e)). However s. 168(4) provides

that the Governor in Council can act contrary to any provision in Part 1. Therefore,

Parliament simultaneously attempts to limit the Governor in Council to regulating

specific subjects whilst also attempting to permit the Governor in Council to regulate

anything they want.

[269]

Recently, some of the senior judiciary in England and Wales have accepted

that another inherent limit is that parliamentary sovereignty demands an impartial,

independent and authoritative body to interpret Parliament’s acts. Because Parliament

can only speak through written texts, its work can only be effective when interpreted

by such a body (R. (Cart) v. Upper Tribunal, [2009] EWHC 3052 (Admin.), [2011]

Q.B. 120, at paras. 37-39, per Laws L.J.; R. (Privacy International) v. Investigatory

Powers Tribunal, [2019] UKSC 22, [2020] A.C. 491, at paras. 189-90 and 208-10).

Henry VIII clauses are incompatible with this conception of sovereignty. Henry VIII

clauses limit the availability of judicial review by providing no meaningful limits

against which a court could review. This is a problem that equally affects the rule of

law, a principle to which I now turn.

(2) The Rule of Law

[270]

The rule of law is one of the fundamental principles of the Constitution,

lying “at the root of our system of government” (Secession Reference, at para. 70; see

also Roncarelli v. Duplessis, [1959] S.C.R. 121, at p. 142). It is also expressly

recognized in the preamble to the Canadian Charter of Rights and Freedoms:

“Whereas Canada is founded upon principles that recognize the supremacy of God and

the rule of law.”

[271]

The rule of law embraces three related principles (Imperial Tobacco, at

para. 58). First, “the law is supreme over officials of the government as well as private

individuals, and thereby preclusive of the influence of arbitrary power” (Manitoba

Language Rights, at p. 748). Second, “the rule of law requires the creation and

maintenance of an actual order of positive laws which preserves and embodies the more

general principle of normative order” (Manitoba Language Rights, at p. 749). Third,

“the exercise of all public power must find its ultimate source in a legal rule”

(Provincial Judges Reference, at para. 10). In other words, “[a]t its most basic level,

the rule of law vouchsafes to the citizens and residents of the country a stable,

predictable and ordered society in which to conduct their affairs. It provides a shield

for individuals from arbitrary state action” (Secession Reference, at para. 70).

[272]

Even in its most formal sense, the rule of law requires that all legislation

be enacted in the manner and form prescribed by law (Imperial Tobacco, at para. 60).

This includes the requirements that legislation receive three readings in the Senate and

House of Commons and that it receive Royal Assent (Authorson v. Canada (Attorney

General), 2003 SCC 39, [2003] 2 S.C.R. 40, at paras. 37-41). When the Governor in

Council amends legislation, it does not follow this prescribed manner and thus violates

the rule of law.

[273]

There are two additional rule of law concerns with the delegation of

legislative power to the executive. The first, as Professor Elmer A. Driedger noted, the

“delegation of power to amend a statute is generally regarded as objectionable for the

reason that the text of the statute is then not to be found in the statute book” (The

Composition of Legislation: Legislative Forms and Precedents (2nd rev. ed. 1976), at

p. 198). This gives rise to confusion and uncertainty, which are inimical to the rule of

law (Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65, at

para. 72).

[274]

The second additional concern is that Henry VIII clauses endow the

executive with authority to act arbitrarily. They do so by permitting the executive to

act contrary to the empowering statute, creating an authority without meaningfully

enforceable limits and thus an absolute discretion. Dicey articulated the rule of law’s

concern with preventing arbitrary power:

[The rule of law] means, in the first place, the absolute supremacy or

predominance of regular law as opposed to the influence of arbitrary

power, and excludes the existence of arbitrariness, of prerogative, or even

of wide discretionary authority on the part of the government. [p. 202]

[275]

In the Canadian context, Justice Rand’s famous reasons in Roncarelli also

warn against absolute power:

. . . there is no such thing as absolute and untrammelled “discretion”, that

is that action can be taken on any ground or for any reason that can be

suggested to the mind of the administrator; no legislative Act can, without

express language, be taken to contemplate an unlimited arbitrary power

exercisable for any purpose, however capricious or irrelevant, regardless

of the nature or purpose of the statute. [p. 140]

[276]

The Chief Justice says that the Governor in Council will be bound by the

express terms and overall purpose and object of the GGPPA (para. 87). I agree with

Brown J. when he says that Henry VIII clauses cannot merely be treated as a matter of

administrative law (para. 414). My concerns are constitutional in nature because I do

not see the Governor in Council as being constrained by meaningful limits that can be

enforced through judicial review. For example, s. 168(4) expressly authorizes the

Governor in Council to act contrary to the provisions of Part 1. Further, the overall

purpose and object of the Act is so broad that the only limit on the Governor in Council

is to act within the matter of national concern identified by the Chief Justice. When

executive action is only limited by the division of powers and not by its empowering

statute, then we can no longer call it executive action. Review for constitutional

compliance with the division of powers is not enough. When an empowering Act

contains a privative clause, the rule of law is not satisfied merely by judicial review for

constitutional compliance.

[277]

In order to protect the rule of law, and prevent arbitrary conduct, courts

have a constitutional duty to judicially review actions of the executive (Crevier v.

Attorney General of Quebec, [1981] 2 S.C.R. 220, at p. 234; see also Dr. Q v. College

of Physicians and Surgeons of British Columbia, 2003 SCC 19, [2003] 1 S.C.R. 226,

at para. 21). In Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, the

majority affirmed that “[j]udicial review is the means by which the courts supervise

those who exercise statutory powers, to ensure that they do not overstep their legal

authority. The function of judicial review is therefore to ensure the legality, the

reasonableness and the fairness of the administrative process and its outcomes”

(para. 28).

[278]

Given that judicial review is constitutionally required, legislation cannot

oust review, either expressly or implicitly (Crevier, at p. 238; Dunsmuir, at para. 31).

When the Governor in Council is given the power to amend an Act, or to act in a manner

inconsistent with the Act, it cannot be said that they are meaningfully limited by the

Act. In the words of Campbell J.:

This power is constitutionally suspect because it confers upon the

government the unprotected authority to pull itself up by its own legal

bootstraps and override arbitrarily, with no further advice from the

Legislative Assembly, and no right to be heard by those who may be

adversely affected by the change, the very legislative instrument from

which the government derives its original authority.

(Ontario Public School Boards’ Assn. v. Ontario (Attorney General)

(1997), 151 D.L.R. (4th) 346 (Ont. C.J. (Gen. Div.)), at p. 363)

(3) The Separation of Powers

[279]

Like parliamentary sovereignty and the rule of law, the separation of

powers is “a fundamental principle of the Canadian Constitution” (Provincial Judges

Reference, at para. 138). Although it is often said that Canada does not have a strict

separation of powers, time and time again this Court has recognized the separation of

powers as “an essential feature of our constitution”, “a cornerstone of our constitutional

regime”, “[o]ne of the defining features of the Canadian Constitution” and a “backbone

of our constitutional system” (Wells v. Newfoundland, [1999] 3 S.C.R. 199, at paras. 52

and 54; Doucet-Boudreau v. Nova Scotia (Minister of Education), 2003 SCC 62, [2003]

3 S.C.R. 3, at para. 107; Cooper v. Canada (Human Rights Commission), [1996] 3

S.C.R. 854, at paras. 3 and 10).

[280]

As an abstract theory, the separation of powers may embody three

dimensions: the same persons should not form part of more than one branch, one branch

should not control or intervene in the work of another, and one branch should not

exercise the functions of another (E. C. S. Wade and G. G. Phillips, Constitutional Law

(3rd ed. 1946), at p. 18).

[281]

In Canada, the first two dimensions of the separation of powers are not

always met. For instance, it is well accepted that “the same individuals control both the

executive and the legislative branches of government” (Wells, at paras. 53-54; see also

Attorney General of Quebec v. Blaikie, [1981] 1 S.C.R. 312, at pp. 320-21). However,

this does not mean that our Constitution fuses the legislative and executive powers

(Canada (Auditor General) v. Canada (Minister of Energy, Mines and Resources),

[1989] 2 S.C.R. 49, at p. 103). Instead, the Constitution of Canada insists on a

separation of powers according to the third dimension — the separation of function. In

Fraser v. Public Service Staff Relations Board, [1985] 2 S.C.R. 455, Dickson C.J.

described the basic functions of each of the three branches:

There is in Canada a separation of powers among the three branches of

government — the legislature, the executive and the judiciary. In broad

terms, the role of the judiciary is, of course, to interpret and apply the law;

the role of the legislature is to decide upon and enunciate policy; the role of

the executive is to administer and implement that policy. [pp. 469-70]

[282]

The separation of powers does not strictly require that all of these functions

remain exclusive. Our Constitution permits one branch to exercise some of the

functions of another branch, when it does so in a way that respects both roles. These

appeals provide a perfect example. We, members of the judiciary, are called upon to

provide advice to three Lieutenant Governors in Council on the constitutionality of the

GGPPA — something that would typically be an executive function (Secession

Reference, at para. 15). However, our jurisprudence also clearly establishes that “[t]he

separation of powers requires, at the very least, that some functions must be exclusively

reserved to particular bodies” (Provincial Judges Reference, at para. 139).

[283]

In Ontario v. Criminal Lawyers’ Association of Ontario, 2013 SCC 43,

[2013] 3 S.C.R. 3, my colleague, Karakatsanis J., confirmed the importance of

identifying and protecting each branch’s core functions:

Over several centuries of transformation and conflict, the English

system evolved from one in which power was centralized in the Crown to

one in which the powers of the state were exercised by way of distinct

organs with separate functions. The development of separate executive,

legislative and judicial functions has allowed for the evolution of certain

core competencies in the various institutions vested with these functions.

The legislative branch makes policy choices, adopts laws and holds the

purse strings of government, as only it can authorize the spending of public

funds. The executive implements and administers those policy choices and

laws with the assistance of a professional public service. The judiciary

maintains the rule of law, by interpreting and applying these laws through

the independent and impartial adjudication of references and disputes, and

protects the fundamental liberties and freedoms guaranteed under the

Charter.

All three branches have distinct institutional capacities and play critical

and complementary roles in our constitutional democracy. [Emphasis

added; paras. 28-29.]

[284]

Justice Karakatsanis’s reasons aptly articulate one of the normative goals

underlying the separation of powers: ensuring that power is allocated according to

skillset and institutional capacities. Another reason was provided by McLachlin J. (as

she then was) in New Brunswick Broadcasting Co. v. Nova Scotia (Speaker of the

House of Assembly), [1993] 1 S.C.R. 319, where she emphasized the importance of

maintaining the balance of power established between the three branches, finding that

“[i]t is fundamental to the working of government as a whole that all these parts play

their proper role. It is equally fundamental that no one of them overstep its bounds, that

each show proper deference for the legitimate sphere of activity of the other” (p. 389).

Maintaining this balance prevents an accumulation of power in any one branch.

[285]

The Court’s concern for protecting the core functions of each branch from

intrusion is perhaps most well developed in the judicial sphere. Grounded in the

judicature provisions of the Constitution Act, 1867, both legislative and executive

bodies are incapable of intruding upon the core jurisdiction of superior courts or

infringing upon the independence of the judiciary (MacMillan Bloedel Ltd. v. Simpson,

[1995] 4 S.C.R. 725, at paras. 2 and 15; Reference re Amendments to the Residential

Tenancies Act (N.S.), [1996] 1 S.C.R. 186, at para. 56; Criminal Lawyers’ Association

of Ontario, at paras. 19 and 26; Trial Lawyers Association of British Columbia v.

British Columbia (Attorney General), 2014 SCC 59, [2014] 3 S.C.R. 31). This core

judicial function includes the duty to maintain the rule of law and protect citizens from

arbitrary action by supervising state action (MacMillan Bloedel, at paras. 32-35;

Crevier, at pp. 234-38).

[286]

There are also well developed doctrines to protect core executive functions

from judicial intrusion. For instance, our jurisprudence demonstrates the importance of

restraint when reviewing certain exercises of royal prerogative (Operation Dismantle

Inc. v. The Queen, [1985] 1 S.C.R. 441; Secession Reference, at paras. 26-28; Canada

(Prime Minister) v. Khadr, 2010 SCC 3, [2010] 1 S.C.R. 44, at paras. 36-37; see also

Hupacasath First Nation v. Canada (Minister of Foreign Affairs), 2015 FCA 4, 379

D.L.R. (4th) 737). The doctrine of cabinet privilege similarly serves to protect core

executive functions (Carey v. Ontario, [1986] 2 S.C.R. 637; Babcock, at paras. 18-19

and 60).

[287]

The Court has also established limits on judicial interference with essential

legislative functions, most notably through acknowledging the existence of

parliamentary privilege over core legislative activities. As Binnie J. said, “[e]ach of the

branches of the State is vouchsafed a measure of autonomy from the others”;

“[p]arliamentary privilege, therefore, is one of the ways in which the fundamental

constitutional separation of powers is respected” (Canada (House of Commons) v.

Vaid, 2005 SCC 30, [2005] 1 S.C.R. 667, at para. 21; see also New Brunswick

Broadcasting Co., at p. 377). Parliamentary privilege provides immunity “necessary to

protect legislators in the discharge of their legislative and deliberative functions, and

the legislative assembly’s work in holding the government to account for the conduct

of the country’s business” (Vaid, at para. 41; see also Chagnon v. Syndicat de la

fonction publique et parapublique du Québec, 2018 SCC 39, [2018] 2 S.C.R 687, at

paras. 27 and 127).

[288]

In addition to respecting the bounds of parliamentary immunity, courts

have refrained from imposing procedural fairness requirements on legislating, other

than requiring that legislation receive three readings in the Senate and House of

Commons and that it receive Royal Assent (Authorson, at paras. 37-41). Recently, a

majority of this Court held that the duty to consult does not apply to ministers of the

Crown engaged in drafting bills, as this is a legislative function: “Extending the duty

to consult doctrine to the legislative process would oblige the judiciary to step beyond

the core of its institutional role and threaten the respectful balance between the three

pillars of our democracy” (Mikisew Cree First Nation v. Canada (Governor General

in Council), 2018 SCC 40, [2018] 2 S.C.R. 765, at para. 2; see also paras. 117, 122,

148, 163-64 and 167).

[289]

Most of these protections are against judicial intrusion. However, the Court

has also recognized that the executive cannot interfere with the legislative process in a

manner that would restrict the power to enact, amend and repeal legislation, despite the

important role played by the executive in the legislative process (Pan-Canadian

Securities Reference, at para. 53). Chief Justice Lamer noted that “there is a

hierarchical relationship between the executive and the legislature, whereby the

executive must execute and implement the policies which have been enacted by the

legislature in statutory form” (Provincial Judges Reference, at para. 139).

[290]

The separation of powers equally demands that the core function of

enacting, amending and repealing statutes be protected from the executive and remain

exclusive to the legislature. Doing so supports the two main normative principles

underlying the separation of powers.

[291]

First, the legislature is the institution best suited to set policy down into

legislation. The constitutionally mandated process in ss. 17 and 91 of the Constitution

Act, 1867, ensures that the legislation is made in public forums that provide

opportunities for substantial examination and debate. The legislative process provides

equally for high-level policy debates and line-by-line technical edits. Most importantly,

legislating through legislatures requires, by “its very nature, the need to build majorities

[and] necessitates compromise, negotiation, and deliberation. No one has a monopoly

on truth, and our system is predicated on the faith that in the marketplace of ideas, the

best solutions to public problems will rise to the top” (Secession Reference, at para. 68).

This is why “the role of the legislature is to decide upon and enunciate policy” (Fraser,

at p. 470).

[292]

Second, limiting the power to enact, amend and repeal legislation to the

legislature helps to confine power and prevent an even greater concentration of power

in the executive. There is no doubt that the executive branch wields great power in this

country. In practice, the executive can control the day-to-day operations of the

legislature (Blaikie, at p. 320). However, an executive branch with the power to

legislate on its own, without the legislature at all, wields a much greater and far more

dangerous power. As we have seen above, the legislative process takes place in public

before the scrutiny of non-government members and the press. When the government

does not control a majority of seats in the legislature, the legislative process can require

extensive compromise. In contrast, when Cabinet amends the GGPPA, it does so

shrouded in cabinet secrecy, free from public scrutiny. There can be no doubt as to “the

pre-eminent importance of the House of Commons as ‘the grand inquest of the nation’”

(Vaid, at para. 20).

[293]

The Fathers of Confederation and the Framers of the Constitution Act,

1982, both recognized the importance of the parliamentary process by requiring that

Parliament sit at least once every twelve months (s. 20 of the British North America

Act, 1867 (as enacted) and s. 5 of the Charter). There is nothing more core to the

legislative power than legislating. When the executive usurps this function, the

separation of powers is clearly violated.

IV. Conclusion

[294]

When the clear text of ss. 17 and 91 of the Constitution Act, 1867, is read

in light of the foundational constitutional principles of parliamentary sovereignty, rule

of law and separation of powers, I have no doubt that clauses that purport to confer on

the executive branch the power to nullify or amend Acts of Parliament are

unconstitutional. In addition, the GGPPA cannot fall within a matter of national

concern defined by minimum standards when such standards are those of the executive,

and not those of the Parliament.

[295]

Therefore, while I agree with the Chief Justice’s formulation of the national

concern branch analysis, I do not agree with his application of the law to the facts of

this case. As this Act is presently drafted, it does not set minimum standards and

delegates a legislative power to the executive. Accordingly, while I join the

Chief Justice in finding that Parliament has the power to enact constitutionally valid

legislation in this realm, I must partially dissent.

The following are the reasons delivered by

BROWN J. —

I.

Introduction

[296]

With the aim of mitigating climate change, the Greenhouse Gas Pollution

Pricing Act, S.C. 2018, c. 12, s. 186 (“Act”), implements measures ⸺ specifically,

carbon pricing (in the case of Part 1 of the Act) and the regulation of heavy industry (in

the case of Part 2) ⸺ to discourage activities that emit greenhouse gases (“GHGs”) into

the atmosphere.

[297]

The issue before us is whether the Act is intra vires Parliamentary

authority. Importantly, the issue is not whether Parliament can act to combat climate

change. It clearly can ⸺ indeed, it can do much of what it seeks to do in the Act by, for

example, exercising its taxation power under s. 91 of the Constitution Act, 1867. Nor

is the issue whether Parliament can act to confront this or other existential threats to

the country. Again, it clearly can, by relying upon its broad residual power to legislate

in response to emergencies for the peace, order, and good government of Canada

(“POGG”).

[298]

In other words, the constitutionality of the scheme that Parliament has

enacted in this case does not govern whether Parliament can seek to control GHG

emissions so as to meet reduction targets. It can. The question before us goes simply to

how Parliament has chosen to do so ⸺ and, in particular, whether it has chosen a means

of doing so that is supported by its legislative authority as conferred by the Constitution

of Canada. This question properly directs our attention to the structure and operation

of the Act ⸺ features which receive little to no consideration in the majority’s reasons

⸺ and to the jurisdictional basis upon which the Attorney General of Canada seeks to

uphold it. Again, it is worth stressing ⸺ since all parties before us say that much is at

stake in the fight against climate change ⸺ that Parliament’s capacity to contribute

meaningfully to that fight does not hang on the Court’s answer to the reference

question.

[299]

The Attorney General of Canada urges us to find that the Act represents a

constitutionally valid exercise by Parliament not of the powers it clearly has to address

climate change, but of its residual authority to legislate with respect to matters of

“national concern” under POGG. The significance of this cannot be overstated. This

power ⸺ unlike Parliament’s authority to legislate in the face of national emergencies

⸺ permanently vests exclusive jurisdiction in Parliament over the matter said to be of

national concern. Were this simply the straightforward matter, as the Attorney General

of Canada says, of requiring polluters to “pay”, the consequences for the division of

powers would be minor. But neither the Attorney General nor the majority fairly or

completely describes what the Act does. In particular, they downplay significantly what

the Act actually authorizes the Governor in Council ⸺ that is, the federal Cabinet ⸺

to do, and ignore the detailed regulatory intrusion into matters of provincial jurisdiction

authorized by Part 2 of the Act. The result is a permanent and significant expansion of

federal power at the expense of provincial legislative authority ⸺ unsanctioned by our

Constitution, and indeed, as I will explain, expressly precluded by it.

[300]

The majority accedes to all these things, granting the Attorney General of

Canada everything he seeks. But it does not stop there. The majority goes even further,

in substance abandoning and re-writing this Court’s jurisprudence on the national

concern branch of POGG as stated in R. v. Crown Zellerbach Canada Ltd., [1988] 1

S.C.R. 401. Specifically, it dilutes the test stated in Crown Zellerbach, which required

that a national concern exhibit qualities of “singleness, distinctiveness and

indivisibility” (p. 432) from a matter falling within provincial legislative authority, by

injecting into that test a body of unrelated trade and commerce jurisprudence. The result

is a new three-step test. Under this new test, the requirement of “singleness,

distinctiveness and indivisibility” is informed by two “principles” that “animat[e]” the

inquiry (Chief Justice’s reasons, at para. 146). The first of these “animating” principles

is two-pronged, and one of those prongs is informed by three “factors” (paras. 147, 151

and 157). The second “animating principle” is to be analyzed by reference to three other

requirements (paras. 152-56). To add to the confusion, the inevitable resulting

expansion of federal authority under the national concern branch is fortified by the

injection of judicial discretion into the scale of impact analysis, by which the scale of

impact on provincial jurisdiction is balanced in light of other “interests”, which

implicitly include the judiciary’s view of the importance of the matter (paras. 161 and

206). (It is apparently to be assumed that all important matters fall within federal

jurisdiction.)

[301]

But the true danger in the majority’s reasons for judgment does not lie in

the blending of trade and commerce jurisprudence with POGG jurisprudence, or in the

confusing and confused test that it states. It is in the majority’s abandonment of any

meaningful constraint on the national concern branch of the POGG power.

[302]

I concur with Rowe J.’s reasons and therefore adopt his review of the

jurisprudence on the residual POGG power, conferred upon Parliament by the preamble

to s. 91 of the Constitution Act, 1867. My reasons proceed as follows. First, I will

canvass the scheme of the Act itself, with a view to explaining its structure and

operation so as to characterize its pith and substance, and to classify it among the heads

of legislative authority prescribed in the Constitution. In so doing, I will explain why

Parliament’s reliance on the national concern doctrine to defend the Act encounters an

insurmountable constitutional problem. The Act’s very structure belies any argument

that its dominant subject matter relates to a distinctly federal matter, since it applies

only where provincial legislatures have not enacted carbon pricing measures, either at

all or as stringent as those preferred by the federal Cabinet. In other words, the Act’s

structure and operation is premised on provincial legislatures having authority to enact

the same scheme. This is fatal to the constitutionality of the Act under the POGG

national concern branch, since s. 91 states provincial legislative authority is “assigned

exclusively” ⸺ that is, to the exclusion of Parliament’s authority to act. This is a

fundamental limiting feature of the federal POGG power for which the majority’s

reasons do not account.

[303]

I will then consider how the Attorneys General of Canada and of British

Columbia, seeking to overcome that objection, argue that the imposition of minimum

national standards is the distinctly federal or national aspect of the matter. But this

simply begs the question ⸺ minimum national standards of what? If the subject of

those “minimum national standards” is a matter falling within provincial legislative

authority ⸺ which, again, the Act by its very structure contemplates ⸺ the injection of

“minimum national standards” adds nothing. For example, until this Court’s judgment

from which I now dissent, it would have been no more constitutional for Parliament to

adopt “minimum national standards” governing hospital administration, the location or

construction of hydroelectric generating facilities, the inflationary effects of

intra-provincial trade and commerce (such as wage and price controls), or the

exploration and development of non-renewable natural resources. Now, such things are

entirely possible (at least, where a judge views them as being “important”).

[304]

It follows that the Act is not a valid exercise of Parliament’s residual

legislative authority. Nor — though the argument was hardly pursued by the Attorney

General of Canada — can the Act be upheld as a valid exercise of any other federal

head of power, at least not without the benefit of fuller argument than the passing

reference contained in the Attorney General’s factum. I would therefore conclude that

the Act is wholly ultra vires Parliament.

[305]

Having disposed of the reference question by applying this Court’s

jurisprudence, I will then turn to consider the majority’s dilution of the Crown

Zellerbach test.

II. The Act

[306]

The Act’s preamble describes climate change as a national problem, which

cannot be contained within geographic boundaries and requires immediate action. It

therefore states its intention to create “incentives for . . . behavioural change” by

implementing a “federal greenhouse gas emissions pricing scheme”.

[307]

Two distinct regulatory mechanisms are authorized by the Act. Part 1

creates a regulatory charge on GHG-emitting fuels, which will increase annually until

2022. This charge is levied against certain producers, distributors and importers, with

the expectation that they will pass this charge on to end consumers. In this way, it is

expected to change public behaviour, thereby reducing demand for and consumption

of GHG-emitting fuels. Subject to a number of exceptions, the charge applies to fuels

that are produced, delivered or used in a “listed province”, brought into a listed

province from another place in Canada, or imported into Canada at a location in a listed

province (ss. 17 to 39). The fuel charge currently applies to 22 fuels that emit GHGs

when burned, including gasoline, diesel fuel, natural gas and “combustible waste”. The

fuels are listed in Sch. 2 of the Act and are subject to modification by the federal

Cabinet.

[308]

The second mechanism, created under Part 2, is described as an

output-based pricing system (“OBPS”). The structure of the OBPS casts significant

doubt on the correctness of the majority’s characterization of the entire Act’s pith and

substance as “establishing minimum national standards of GHG price stringency to

reduce GHG emissions” (para. 57). Rather, the OBPS is animated by concerns over

industrial competitiveness in specific emissions-intensive Canadian industries that

compete in international markets, and with the consequent economic and

environmental impacts of “carbon leakage” — the movement of industry to

jurisdictions with a lower carbon price. Part 2, therefore, is designed not only “to create

incentives for . . . behavioural change”, but also to maintain the international

competitiveness of some emissions-intensive and trade-exposed industries (being those

selected by the federal Cabinet) by exempting them from the fuel charge established by

Part 1, and subjecting them instead to different levels of carbon pricing based on

Cabinet’s responsiveness to the competitiveness and carbon leakage concerns of that

particular industry.

[309]

Part 2 achieves its goal by authorizing the federal Cabinet to limit the total

emissions that can be produced without charge by an industrial facility. It applies to

facilities located in a listed province that either meet the criteria set out in the

regulations or are designated by the Minister of the Environment. Facilities subject to

the OBPS that operate within their emissions limit receive surplus credits called

compliance units which can be sold or banked to offset future emissions. Facilities that

exceed their limit must pay an excess emissions charge, remit compliance units, or

both.

[310]

The emissions limit of a particular facility is calculated by multiplying its

volume of production by a factor — in the language of the Act, a sector-specific

“output-based standard” — set out in the Output-Based Pricing System Regulations,

SOR/2019-266 (“Regulations”). This standard is typically based on a percentage of the

national, production-weighted average emissions intensity of the specific industrial

activity in question (a large exception is electricity generation, where the standards are

based on whether solid, liquid or gaseous fuels are used). The percentage used to

calculate the standard is adjusted based on an assessment of competitiveness and

carbon leakage concerns for that particular industrial activity. This assessment is

crucial because the cost per tonne of carbon emitted in relation to any given industrial

activity is dictated solely by the percentage used to set the output-based standard.

[311]

In the result, Part 2 grants the federal Cabinet the power to set carbon costs

on an activity-by-activity basis. Schedule 1 of the Regulations sets out the standards

for an array of different products, from bitumen to potash to pulp, that give rise to

different carbon prices for emissions related to that product.

[312]

A key feature of the Act is that its application is dependent upon whether

and how provinces have exercised their legislative authority to reduce GHG emissions.

Meaning, the Act is designed to operate as a backstop, applying in only those provinces

that have not (1) adopted carbon pricing as the means for reducing GHG emissions, (2)

to a stringency that meets the federal Cabinet’s preferred measure. To allow for this

contingent operation, the Act grants the federal Cabinet discretion to determine whether

it will apply in a given province. (As I will discuss below, this is a significant

consideration militating against the Act’s constitutionality.) In Part 1, ss. 166(2) and (3)

provide that, “[f]or the purpose of ensuring that the pricing of greenhouse gas emissions

is applied broadly in Canada at levels that the [federal Cabinet] considers appropriate”,

Cabinet may designate the listed provinces in which the fuel charge regime will apply,

taking into account “the stringency of provincial pricing mechanisms for greenhouse

gas emissions” as the primary factor. In Part 2, ss. 189(1) and (2) authorize Cabinet to

designate the backstop jurisdictions in which Part 2 will apply, “[f]or the purpose of

ensuring that the pricing of greenhouse gas emissions is applied broadly in Canada at

levels that the [federal Cabinet] considers appropriate” taking into account, again, “the

stringency of provincial pricing mechanisms for greenhouse gas emissions” as the

primary factor.

III. Analysis for Constitutionality

[313]

A reviewing court must apply two steps to determine whether an enactment

falls within the legislative authority of the enacting body. First, the enactment must be

characterized to determine its pith and substance or dominant subject matter. Secondly,

the identified subject matter must be classified, with reference to the classes of subjects

described in ss. 91 and 92 of the Constitution Act, 1867 (Desgagnés Transport Inc. v.

Wärtsilä Canada Inc., 2019 SCC 58, at para. 30). Each step must be treated distinctly.

Characterizing an enactment with reference to the heads of power creates “a danger

that the whole exercise will become blurred and overly oriented towards results”

(Chatterjee v. Ontario (Attorney General), 2009 SCC 19, [2009] 1 S.C.R. 624, at

para. 16; see also A. S. Abel, “The Neglected Logic of 91 and 92” (1969),

19 U.T.L.J. 487, at p. 490). At the same time, however, we cannot lose sight of how

these two distinct steps interact. As Professor P. W. Hogg explains in Constitutional

Law of Canada (5th ed. Supp. (loose-leaf)), vol. 1, at p. 15-6:

. . . neither of these two steps has any significance by itself. The challenged

statute is characterized . . . as in relation to a “matter” (step 1) only to

determine whether it is authorized by some head of power in the

Constitution. The “classes of subjects” are interpreted (step 2) only to

determine which one will accommodate the matter of a particular statute.

[314]

The analytical process differs somewhat, however, where, as here,

Parliament relies upon the national concern branch of POGG as the source of its

authority to legislate. After identifying the pith and substance of the impugned law, and

deciding that it does not fall under an enumerated head of power, the reviewing court

must then consider whether the matter said to be of national concern satisfies the

requirements stated in Crown Zellerbach.

A. Characterization

[315]

The pith and substance of a law has been described as “an abstract of the

statute’s content”, or the law’s “dominant purpose”, “leading feature”, “true nature and

character”, or “dominant or most important characteristic” (Whitbread v. Walley,

[1990] 3 S.C.R. 1273, at p. 1286, citing P. W. Hogg, Constitutional Law of Canada

(2nd ed. 1985), at p. 313; R. v. Morgentaler, [1993] 3 S.C.R. 463, at p. 482). It is well

established that the dominant subject matter of an enactment is determined by

considering its purpose and effects (Quebec (Attorney General) v. Canada (Attorney

General), 2015 SCC 14, [2015] 1 S.C.R. 693, at para. 29).

[316]

Determining the appropriate breadth by which to characterize the

impugned law is essential. The legislation’s dominant subject matter must be

characterized precisely enough for it to be associated with a specific class of subjects

described in the Constitution’s heads of power. Characterizations that are too broad,

vague, or general “are unhelpful in that they can be superficially assigned to various

heads of powers” (Desgagnés, at para. 35; see also Reference re Assisted Human

Reproduction Act, 2010 SCC 61, [2010] 3 S.C.R. 457, at para. 190).

(1) Broad Proposed Characterizations

[317]

The Attorneys General of Ontario and Alberta describe the Act’s pith and

substance as relating to the regulation of GHG emissions. I agree with the Attorneys

General of Canada and British Columbia that this is too broad because it does not

facilitate classification under a federal or provincial head of power. GHG emissions are

produced by virtually all facets of human activity and can therefore be regulated in

innumerable different ways that will correspond to different heads of power. In that

sense, identifying “regulating GHG emissions” as the pith and substance of a law

suffers from the same deficiency as “regulating the environment” which, as this Court

has said, is “not an independent matter of legislation” but rather “a sweeping subject or

theme virtually all-pervasive in its legislative implications”, that “touch[es] several of

the heads of power assigned to the respective levels of government” (Friends of the

Oldman River Society v. Canada (Minister of Transport), [1992] 1 S.C.R. 3, at

pp. 63-64; R. v. Hydro-Québec, [1997] 3 S.C.R. 213, at para. 154, quoting W. R.

Lederman, “Unity and Diversity in Canadian Federalism: Ideals and Methods of

Moderation” (1975), 53 Can. Bar Rev. 597, at p. 610). Identifying the pith and substance

requires greater specificity in describing how the legislation proposes to regulate GHG

emissions. Again, the purpose of characterization must be borne in mind: it is to

facilitate classification so as to determine whether the Constitution grants the enacting

body ⸺ in this case, Parliament ⸺ legislative authority over the subject matter.

[318]

In support of a broad characterization, Ontario says that legislative purpose

must not be confused with the means chosen to achieve it, a proposition various parties

attribute to this Court’s decision in Ward v. Canada (Attorney General), 2002 SCC 17,

[2002] 1 S.C.R. 569, at para. 25 (A.F., Attorney General of Ontario, at para. 35; I.F.,

Attorney General of New Brunswick (38663 and 38781), at para. 20; I.F., Attorney

General of Manitoba (38663 and 38781), at para. 25). But Ward simply reinforces the

view that greater specificity than “regulating GHG emissions” is required. While the

provision at issue in Ward imposed a prohibition on the “sale, trade or barter” of

whitecoat and blueback seals, to refer to the legislation as prohibiting trade in baby

seals was insufficiently precise. The same prohibition might relate to property and trade

(authorized by s. 92(13)), or to conserving the economic viability of the seal fishery

(authorized by s. 91(12)). It was clear from the broader context, however, that the

enactment’s purpose was to conserve the seal fishery, and the enactment was therefore

authorized by the federal government’s fisheries power (paras. 23 and 49). This Court’s

statement in Ward was, accordingly, directed to cases where describing legislation only

in terms of its means would not accurately capture its dominant subject matter. Nothing

in Ward requires altogether excluding legislative means from the pith and substance

analysis.

[319]

Moreover, it will not always be possible to clearly distinguish between

means and purpose. The end goal at one level of abstraction may be viewed as the

means to some broader goal at another level of abstraction. Here, for example, carbon

pricing is the chosen means to generate behavioral change, which is the chosen means

to reduce GHG emissions, which is the chosen means to combat climate change.

Feasibility and efficacy aside, alternatives exist at each level of abstraction: the

government might opt to remove GHGs from the atmosphere to combat climate

change; it might prohibit certain products or activities to reduce GHG emissions; and

it might reward “green” behaviours to generate behavioral change. It cannot therefore

be said, as a general proposition, that the dominant subject matter of an enactment must

not refer to the means chosen to implement the legislative purpose. That said, and as I

will explain below, to incorporate the legislative means within the pith and substance

of a statute will have particular consequences when deciding its constitutionality under

the national concern branch of POGG.

[320]

Whether one views the stated subject matter as the means or the objective

depends, then, on the chosen level of abstraction. And the determinative consideration

in identifying an appropriate level of abstraction should be facilitating the subject

matter’s classification among the classes of subjects described in ss. 91 and 92 so far

as necessary to resolve the case. If an enactment’s subject matter could be classified

under different heads of power listed under both ss. 91 and 92, then the subject matter

should be identified with more precision until it is clear which single level of authority

(as between federal and provincial) may legislate in respect thereof (Reference re

Assisted Human Reproduction Act, at para. 190). A sufficiently precise description may

well refer to why and how the law operates (Chatterjee, at para. 16).

(2) Narrow Proposed Characterizations

[321]

I turn now to the characterizations advanced by the Attorneys General of

Canada and British Columbia in support of their arguments that the Act is intra vires

Parliamentary authority to regulate matters of national concern under POGG.

[322]

I observe at the outset that, when Parliament seeks to permanently and

exclusively regulate a matter of national concern, one would expect the Attorney

General of Canada to have a single, clear, and consistent position about just what he

thinks Parliament was doing. More particularly, he should be able to readily ⸺ and,

again, consistently ⸺ identify the narrow and distinct matter that the legislation in

question addresses. That has not occurred here. Instead, the Attorney General has

offered up a vast array of shifting arguments in various courts at various stages in the

proceedings. This alone should provoke deep suspicion about the correctness of those

arguments.

[323]

To assuage these suspicions, the Attorney General of Canada

acknowledges that his approach has “evolved”, having been “informed” along the way

“by the characterizations of [the] courts below” (R.F., at para. 61). So where has this

“evolution” brought him? Before this Court, it has at last brought him to the revelation

that the Act’s dominant subject matter is “establishing minimum national standards

integral to reducing nationwide GHG emissions” (para. 56 (emphasis deleted)).

[324]

This is similar to the characterization that the Attorney General of British

Columbia successfully urged the Court of Appeal for Saskatchewan to adopt:

“. . . ‘minimum national standards of stringency for pricing GHG emissions’” (2019

SKCA 40, 440 D.L.R. (4th) 398, at paras. 11 and 431). Before us, British Columbia

urged a variation, specifically: “. . . establishing minimum national pricing standards

to allocate part of Canada’s targets for GHG emissions reduction” (A.F., at para. 2

(emphasis deleted)).

[325]

None of these characterizations can be sustained.

[326]

The principal difficulty with these submissions is the invocation of

“minimum national standards”. It adds nothing to the pith and substance of a matter,

which is directed not to the fact of a standard, but to the subject matter to which the

standard is to be applied. In other words, identifying “minimum national standards” as

part of the dominant subject matter begs the very question which the characterization

analysis seeks to answer: minimum national standards of what?

[327]

“Minimum national standards” is a nothing. It is an artifice — or, as the

Attorney General of Alberta puts it, a rhetorical “sleight of hand” (R.F., at para. 44).

Only federally enacted standards can be both “national” (in the sense that only federal

legislation can apply nationwide, while provincial legislative authority cannot extend

beyond its borders) and a “minimum” (since, if a provincial standard is different from

a corresponding federal standard, the operation of paramountcy ensures that the federal

standard will prevail). In the result, using “minimum” and “national” to describe the

Act’s pith and substance is empty and misleading.

[328]

None of this is answered by the majority. Indeed, nowhere does the

majority justify the inclusion of “minimum national standards” in its characterization

of the pith and substance of the Act. Instead, the majority simply and peremptorily

expresses its “view” that “the federal government’s intention was not to take over the

field of regulating GHG emissions, or even that of GHG pricing, but was, rather, to

establish minimum national standards of GHG price stringency for GHG emissions”,

and that “minimum national standards” adds something “essential” to the pith and

substance of the Act (paras. 65 and 81). The majority also says that the impugned

federal legislation in Hydro-Québec (which also included a backstop) was not

described by this Court as imposing minimum national standards (at para. 33, per

Lamer C.J. and Iacobucci J., dissenting, and at paras. 130 and 146, per La Forest J.),

because the backstop nature of that legislation was but a “mere feature” ⸺ whereas, in

this case, the backstop nature of the Act is its “main thrust”, “dominant characteristic”,

and “defining feature” (Chief Justice’s reasons, at para. 82). Respectfully, the

distinction between a legislative structure that operates as a “mere” feature as opposed

to a “dominant” or “defining” one is elusive. Indeed, my colleagues appear also to find

it so, since they do not explain it. Little in Part 1 or 2 of the Act is cited in support for

the proposition that, here, the backstop model is a “defining”, as opposed to a “mere”,

feature. We are simply to accept that this is so because the majority declares it to be so,

citing not the actual statute and what it does, but instead the Final Report of the

Federal-Provincial-Territorial Working Group on Carbon Pricing Mechanisms, 2016

(online), two federal reports, and excerpts from debates in the House of Commons

(paras. 65-67). While these sources form part of the relevant backdrop, they are not a

proxy for serious judicial scrutiny of the Act and, in particular, of Part 2 ⸺ the slightest

attention to which reveals, as I have already described, that it does indeed have the

potential to “take over the field of regulating GHG emissions” in the listed industries.

[329]

The majority responds to this point by stating that some federal legislation

— such as the legislation at issue in Reference re Securities Act, 2011 SCC 66, [2011]

3 S.C.R. 837 (“2011 Securities Reference”), which allowed provinces to opt-in — does

not necessarily apply nationally or create a minimum standard. Here, by contrast, the

Act “applies in all the provinces at all times” (yet it is not a “blunt unified national

system”) (Chief Justice’s reasons, at para. 81). This, says the majority, somehow

legitimizes the inclusion of “minimum national standards” in its description of the Act’s

pith and substance (para. 81). With respect, this misses the critical point. It is not that

all federal legislation imposes minimum national standards, but rather that, by

operation of paramountcy and the territorial limits of provincial jurisdiction, only

Parliament is capable of imposing minimum national standards. The inclusion of

“minimum national standards” in the pith and substance of a federal statute effectively

decides the jurisdictional dispute. While, as I have explained, it can be appropriate to

include reference to the legislative means in the pith and substance, it is entirely

inappropriate to short-circuit the analysis by describing the means as something that

only federal legislative authority can undertake.

[330]

In short, and remarkably, the majority barely acknowledges that this idea

of describing the pith and substance of a statute in terms of “minimum national

standards” might be the least bit controversial, saying nothing to justify it, either

generally or specifically. Indeed, in the face of objections thereto from the parties, and

majority and dissenting judgments at the courts of appeal, one can only surmise that

the majority does not wish to truly engage the point. This may well be because the

device of “minimum national standards” allows the majority to effectively bypass

several steps of their diluted reformulation of the test for the national concern branch

from Crown Zellerbach ⸺ a subject to which I return below.

[331]

A final point about “minimum national standards”. Even if “minimum

national standards” represented anything meaningful for our purposes, the fact remains

that Part 2 of the Act imposes no explicit standards, whether “minimum” or “national”.

Rather, it allows the federal Cabinet to selectively impose an array of carbon prices on

an array of different trade-exposed industries, with the stated goal of maintaining their

international competitiveness and minimizing carbon leakage.

[332]

The Attorney General of Canada’s reference to “integral” standards also

has no relevance to identifying the Act’s pith and substance. Determining whether the

standards implemented through the Act are “integral” to reducing Canada’s GHG

emissions would require this Court to consider whether the standards set out in the Act

are effective. Yet, as this Court has repeatedly maintained, “the efficacy of the law is

not a valid consideration in the pith and substance analysis” (Ward, at para. 22). Indeed,

“the wisdom or expediency or likely success of a particular policy expressed in

legislation is not subject to judicial review” (Re: Anti-Inflation Act, [1976] 2 S.C.R.

373, at p. 425). Whether and to what extent any given standard is integral to reducing

Canada’s GHG emissions is a matter of policy that has no bearing on the constitutional

question facing this Court.

[333]

Without “minimum national standards” and “integral” to round out the

characterization proposed by the Attorney General of Canada, we are left with

“reducing nationwide GHG emissions” which ⸺ as a statement of the goal of the law

without any reference to the means proposed to achieve it ⸺ obviously lacks the

specificity necessary to enable classification. This Court’s description of the Act’s

subject matter should provide “an abstract of [its] content, instancing the subjects or

situations to which it applies and the ways it proposes to govern them” (Abel, at p. 490).

In order to determine whether the federal government can enact any particular GHG

emission “standard of stringency”, we must describe, concisely but precisely, how that

standard operates.

[334]

Turning to the Attorney General of British Columbia’s proposed

characterization, without “minimum national standards”, we are left with “allocat[ing]

part of Canada’s targets for GHG emissions reduction”. However, as the Attorney

General of Alberta points out, it is difficult to accept that the Act allocates part of

Canada’s overall targets when it “neither sets nor allocates any targets” at all (R.F., at

para. 45). The Act imposes a fuel charge and gives the federal Cabinet policy levers to

set carbon prices by industry. This is an odd way to allocate emissions reduction targets.

[335]

For these reasons, Canada and British Columbia’s proposed

characterizations of the Act’s pith and substance must be rejected. It is therefore

necessary to analyze anew the purpose and effects of the law so as to characterize them

appropriately.

(3) Purpose and Effects

[336]

There is no real dispute about the Act’s purpose. Its broad aim is to reduce

Canada’s GHG emissions to mitigate climate change. More narrowly, the Act’s purpose

is to change behaviour. Its preamble states that behavioral change “is necessary for

effective action against climate change” and, further, that “the pricing of greenhouse

gas emissions on a basis that increases over time is an appropriate and efficient way to

create incentives for that behavioural change”. The Act refers to Canada having made

international commitments to reducing its GHG emissions.

[337]

The difficulty with many of the submissions before us, however, including

those of the Attorney General of Canada, is that they attempt to characterize the pith

and substance of the Act as if Parts 1 and 2 were each doing the same thing in the same

way. The majority’s pith and substance analysis is based on the same premise

(para. 71). This is both inexplicable and superficial. Inexplicable, because the two parts

of the Act are not remotely similar to each other; Parliament could have set out each

Part in its own statute. Indeed, doing so might have prompted the majority to consider

the distinct operational features of each Part. And superficial, because it pays little

attention to the regulations; where regulations have been passed, they can ⸺ and, here,

should ⸺ be scrutinized to ascertain the true intent of the legislature (Reference re

Assisted Human Reproduction Act, at para. 84). While Part 1 of the Act increases the

cost of producing, delivering, using, or importing fuels that produce GHG emissions

(which is expected to be passed on to consumers through an increase in the ultimate

retail cost of those fuels), Part 2 does something quite different: it increases the cost of

certain industrial activities by charging large facilities for producing GHG emissions

over prescribed limits based on their particular industry and production processes.

Part 2 also alleviates the impact of carbon pricing on some industries, but not all: the

OBPS covers only the emissions-intensive trade-exposed industries that carry out an

activity that the federal Cabinet chooses to list in the regulations. Picking winners and

losers in this way is the stuff of industrial policy, not carbon price stringency.

[338]

It becomes even more difficult to reconcile Part 2 with the notion of carbon

price stringency when considering the effects of the Regulations themselves. My

colleague Rowe J. has comprehensively reviewed the provisions in the Act that

empower the federal Cabinet to make regulations, and I endorse his analysis, to which

I add this. The current regulations impose varying carbon costs on the industries subject

to the OBPS. The present Regulations establish, by my count, 78 separate output-based

standards across 38 industrial activities. As these output-based standards depend on a

chosen level of stringency (to be decided based on competitiveness and carbon leakage

concerns), the output-based standards ⸺ and thus the average cost per tonne of GHG

emissions ⸺ varies for each of these activities. For example, the 2019 Regulatory

Impact Analysis Statement indicates that a stringency of 95 percent of the average

emissions intensity is prescribed for iron, steel and cement production, which (with an

excess emissions charge of $40 per tonne of carbon emissions in 2021) sets an average

carbon cost of $2 per tonne; a stringency of 90 percent is prescribed for refineries and

petrochemical production, setting an average carbon cost of $4 per tonne; and a

stringency of 80 percent is prescribed for mining, potash and bitumen production and

upgrading, setting an average carbon cost of $8 per tonne (Canada Gazette, Part II,

vol. 153, No. 14, July 10, 2019, at pp. 5387-88 and 5391).

[339]

I stress Part 2 here because, in analysing the scale and sweep of discretion

granted to the federal Cabinet under Part 2 of the Act, the majority vastly understates

what Part 2 actually does. For example, after referring to the federal Cabinet’s power

under Part 2 to regulate and issue orders that take it deep into matters of industrial

policy, the majority says that, like in Part 1, “no aspect of the discretion provided for

in Part 2 permits the Governor in Council to regulate GHG emissions broadly or to

regulate specific industries in any way other than by setting GHG emissions limits and

pricing excess emissions across the country” (para. 76). But this ignores the detailed

regulation-making powers in Part 2, including the federal Cabinet’s discretion to set ⸺

on an industry-by-industry basis ⸺ output-based pricing standards under the

Regulations, and to select which industries are exempt from having to pay the Part 1

fuel charge so as to preserve their international competitiveness. Rather than establish

minimum national standards, therefore, it seems more correct to say that the Act

empowers the federal Cabinet to establish variable and inconsistent standards for an

array of different industrial activities.

[340]

It follows from the foregoing that the pith and substance of Parts 1 and 2

of the Act ought to be characterized separately. And it also follows from the foregoing

that the pith and substance of Part 1 of the Act is the reduction of GHG emissions by

raising the cost of fuel. The pith and substance of Part 2 of the Act is the reduction of

GHG emissions by pricing emissions in a manner that distinguishes among industries

based on emissions intensity and trade exposure.

B. Classification

[341]

I now turn to determining the class of subjects ⸺ that is, the heads of power

under our Constitution ⸺ to which each of the enactment’s two dominant subject

matters belongs. While the Attorney General of Canada and my colleagues in the

majority have rushed directly to consider whether the Act’s dominant subject matter

fits within the national concern branch of POGG, doing so is unsound as a matter of

constitutional methodology: generally, courts should look first to the enumerated

powers, resorting to the residual POGG authority only if necessary (Hydro-Québec, at

para. 110, per La Forest J.; see also Hogg, at pp. 17-4 to 17-7; and D. Gibson,

“Measuring ‘National Dimensions’” (1976), 7 Man. L.J. 15, at p. 17).

(1) Provincial Jurisdiction

[342]

It must be remembered that the Act’s entire scheme is premised on the

provinces having jurisdiction to do precisely what Parliament has presumed to do in

the Act ⸺ that is, to impose carbon pricing through a comparable scheme.

[343]

Provincial jurisdiction over property and civil rights authorized by

s. 92(13) stands out as the most relevant source of legislative authority for the pith and

substance of Parts 1 and 2 of the Act. Regulating trade and industrial activity, all within

the boundaries of specified provinces, is indisputably captured by this broad head of

power, which includes the regulation of business not coming within one of the

enumerated federal heads of power, as well as, of course, the law of property and of

contracts (Hogg, at pp. 21-2 to 21-3 and 21-8 to 21-10; Citizens Insurance Co. v.

Parsons (1881), 7 App. Cas. 96 (P.C.), at p. 110; Lederman, at pp. 603-4). Indeed, as I

have explained, the Act operates as a backstop, operating only where provincial

legislative authority is not exercised, or not exercised in a manner acceptable to the

federal Cabinet.

[344]

The majority acknowledges the importance of s. 92(13), emphasizing its

importance for Quebec. Ironically, as I shall explain below, that importance is

reinforced by Quebec’s conspicuous absence from s. 94’s provision for the uniformity

of laws governing property and civil rights ⸺ an important feature of the terms on

which Quebec entered Confederation, and which the majority ignores. Further, the

majority’s meager appreciation of s. 92(13)’s significance is made evident both by the

majority’s description of it as a tool merely for preserving “regional and cultural

diversity” (para. 210), and by the hard reality that, under this legislation, the authority

of Quebec and the other provinces under s. 92(13) is now subordinate to federal

authority. To announce that the new national concern test invented by the majority is

both “rigorous” and a “meaningful constraint” on federal power does not make it so

(para. 210). With respect, and as I shall also explain, the majority’s new test, far from

constraining federal authority, instead enables it to encroach on provincial authority,

notably that under s. 92(13).

[345]

The provincial residuum in s. 92(16), granting authority over all matters of

a local or private nature, could also authorise Parts 1 and 2 of the Act in the alternative

(Hogg, at pp. 21-4 to 21-5).

[346]

Part 2 of the Act, as a deep foray into industrial policy, also falls within

matters of provincial legislative authority granted by s. 92(10) over local works and

undertakings. Also relevant to Part 2 of the Act — with its emphasis on heavy industrial

emitters, trade exposure, and international competitiveness — is s. 92A. This head of

power gives the provinces the exclusive jurisdiction to make laws in relation to the

exploration, development, conservation, and management of non-renewable natural

resources in the province. Though not intended to derogate from the existing powers of

Parliament, the resource amendment fortifies the pre-existing provincial powers in this

area and gives the provinces indirect taxation powers, and greater control over, their

natural resources (W. D. Moull, “Section 92A of the Constitution Act, 1867” (1983),

61 Can. Bar Rev. 715, at p. 716; Ontario Hydro v. Ontario (Labour Relations Board),

[1993] 3 S.C.R. 327, at pp. 375-77; Westcoast Energy Inc. v. Canada (National Energy

Board), [1998] 1 S.C.R. 322, at para. 84).

[347]

The foregoing identification of several areas of provincial legislative

authority over the dominant subject matter of a federal statute should ⸺ and, as a matter

of this Court’s constitutional methodology, always has ⸺ led this Court to the

conclusion that the statute is ultra vires Parliament (barring application of the double

aspect or ancillary powers doctrines). As McLachlin C.J. wrote for the majority in

Quebec (Attorney General) v. Lacombe, 2010 SCC 38, [2010] 2 S.C.R. 453, at para. 19,

[t]he first step in determining the validity of the amendments brought

by by-law No. 260 is to identify their dominant characteristic. This is

known as the “matter” of the legislation. Once the matter of the legislation

has been determined, the next step is to assign this matter to one or more

heads of legislative power. If the matter comes within one of the heads of

power allocated to the provinces under the Constitution Act, 1867, then the

impugned law is valid. If it does not, then the court must consider whether

the prima facie invalid law is saved by the doctrine of ancillary powers.

[Emphasis added; citations omitted.]

[348]

And so, in this case the identification of several applicable provincial heads

of power should truly be the end of the matter. This is because all such heads of power,

including those I have just identified as applicable here, are, by the terms of s. 92 (and

s. 92A(1)), matters over which provincial legislatures “may exclusively make Laws”.

And, by the terms of s. 91, the POGG power applies only “in relation to all Matters not

coming within the Classes of Subjects by this Act assigned exclusively to the

Legislatures of the Provinces”. While the constitutional text of “not coming within the

Classes of Subjects . . . assigned exclusively to . . . the Provinces” is recounted in

passing by my colleagues in the majority, they give it no consideration (Chief Justice’s

reasons, at para. 89). Instead, they offer up bromides about the need to “maintain the

autonomy of the provinces and respect the diversity of Confederation” (paras. 4, 48-50

and 89-90) — which assurances are belied by majority judgment’s eliding of clear

constitutional text that was intended to maintain that very provincial autonomy and

diversity. The objection, therefore, remains unanswered: the exclusivity of provincial

jurisdiction over matters falling under s. 92 is fundamental to the Canadian brand of

federalism, and was a unique and deliberate choice by the makers of our Constitution

who were concerned about federal overreach via the POGG power ⸺ a concern, until

now, shared by this Court.

[349]

The language of “peace, order, and good government” (often in the form

of “peace, welfare, and good government”, or “welfare, peace, and good government”)

was frequently included in Imperial constituting documents long before the

Constitution Act, 1867 (appearing, for example, in the Royal Proclamation 1763

(G.B.), 3 Geo. 3 (reproduced in R.S.C. 1985, App. II, No. 1); the Commission

appointing James Murray, Captain General and Governor in Chief of the Province of

Quebec, November 21, 1763 (reproduced in Sessional Papers, vol. XLI, 3rd Sess., 10th

Parl., 1907, No. 18, at p. 128); the Quebec Act, 1774 (G.B.), 14 Geo. 3, c. 83

(reproduced in R.S.C. 1985, App. II, No. 2); An Act for the better regulating the

Government of the Province of the Massachuset’s Bay in New England (G.B.), 1774,

14 Geo. 3, c. 45; the Constitutional Act, 1791 (G.B.), 31 Geo. 3, c. 31 (reproduced in

R.S.C. 1985, App. II, No. 3); An Act to make temporary Provision for the Government

of Lower Canada (U.K.), 1838, 1 & 2 Vict., c. 9; the Union Act, 1840 (U.K.), 3 & 4

Vict., c. 35 (reproduced in R.S.C. 1985, App. II, No. 4); An Act to provide for the

Government of British Columbia (U.K.), 1858, 21 & 22 Vict., c. 99; and the Colonial

Laws Validity Act, 1865 (U.K.), 28 & 29 Vict., c. 63). (See, generally, S. Reid and

M. Scott, Interpretative note on the terms “Peace, order and good government” and

“Peace, welfare and good government”, April 7, 2020 (online).)

[350]

What is different, however, about s. 91 of the Constitution Act, 1867 is the

caveat that laws made under the POGG power may “not com[e] within the Classes of

Subjects . . . assigned exclusively to . . . the Provinces”. While the above-listed

constitutional documents all contain a caveat, it was to the effect that the law-making

power being conferred should not be exercised in a manner inconsistent with the laws

of the Imperial Parliament. For example, the Royal Proclamation cautioned that laws

enacted for the “Peace, Welfare, and good Government” should be “as near as may be

agreeable to the Laws of England”. But our Constitution imposed a new kind of caveat,

by its terms clearly designed to preserve the integrity of provincial legislative authority.

And it makes clear that the federal law-making authority for the peace, order, and good

government of Canada was intended to be subject to the division of powers. Within

their areas of legislative authority, provinces are not only sovereign, but exclusively so.

Hence the constitutional impossibility of the Act’s backstop model: if the provinces

have jurisdiction to do what the Act does ⸺ and, that is, again, the very premise of the

Act’s scheme ⸺ then the Act cannot be constitutional under the national concern branch

of POGG.

[351]

Again, my colleagues in the majority do not grapple with this fundamental

objection, despite accepting that the provinces have the jurisdiction under ss. 92(13)

and (16) and 92A to do precisely what the Act does (para. 197). Instead, they accept

the submissions of the Attorneys General of Canada and of British Columbia that

something else is going on here, that some aspect of the Act is truly and distinctly

national in scope and lies outside provincial jurisdiction which can be regulated by

Parliament under the POGG residual authority over matters of national concern. While

these submissions are premised on what I have explained is an inadequate description

of the pith and substance of the Act, I now turn to show that this view is unsustainable

on this Court’s jurisprudence.

(2) The National Concern Branch of POGG

(a) Defining the Matter of National Concern

[352]

The Attorneys General of Canada and British Columbia urge us to find that

their proposed characterizations of the pith and substance of the Act are one and the

same as the matters of national concern falling under the POGG power. This point

reveals a lack of clarity in the jurisprudence, stemming from the particular way in which

the division of powers analysis proceeds under POGG relative to the enumerated heads

of power under s. 91. As I have explained, where an enumerated head of power is relied

upon, the pith and substance of the impugned law is identified at the characterization

step (for instance, “enhancing public safety by controlling access to firearms through

prohibitions and penalties” in Reference re Firearms Act (Can.), 2000 SCC 31, [2000]

1 S.C.R. 783, at para. 4), and that pith and substance is then classified under a head of

power or class of subjects (in that case, the criminal law power in s. 91(27)).

[353]

The analysis proceeds somewhat differently, however, where, as here,

Parliament relies upon the national concern branch of POGG as the source of its

authority to legislate. After identifying the pith and substance of the impugned law, and

after deciding that it does not fall under an enumerated head of power, the reviewing

court must then consider whether the matter said to be of national concern satisfies the

requirements stated in Crown Zellerbach. If so, the matter is placed under exclusive

and permanent federal jurisdiction. The question arises, however, whether the pith and

substance of the impugned legislation should or can be coextensive with the matter of

national concern, or whether the matter of national concern should or can be broader

than the pith and substance of the legislation. The POGG jurisprudence offers little

guidance on this point. The cases have described the matters of national concern both

broadly (as in Johannesson v. Municipality of West St. Paul, [1952] 1 S.C.R. 292

(aeronautics) and Ontario Hydro (atomic energy)) and narrowly (as in Munro v.

National Capital Commission, [1966] S.C.R. 663 (the development, conservation and

improvement of the National Capital Region in accordance with a coherent plan)),

depending on the particular question to be resolved. What the cases have not done ⸺

with the possible exception of Crown Zellerbach ⸺ is include, within the description

of the matter of national concern, the legislative means of the particular statute under

review. (In Crown Zellerbach, the matter of national concern is described at p. 436 as

both “[m]arine pollution” and “the control of marine pollution by the dumping of

substances”, although later cases have described the matter of national concern

identified in Crown Zellerbach as only “marine pollution”, without the additional

reference to legislative means: see Hydro-Québec, at para. 115, and Friends of the

Oldman River Society, at p. 64.)

[354]

As a general proposition, if a proposed matter of national concern is

described more narrowly ⸺ for instance, by including legislative means ⸺ it will be

easier for that matter to qualify under the test for applying the national concern doctrine

stated in Crown Zellerbach. This is because, again generally, it is easier to demonstrate

that a narrowly defined matter has a singleness, distinctiveness and indivisibility that

clearly distinguishes it from matters of provincial concern. And, of course, the narrower

the matter, the less the impact on provincial jurisdiction. The majority accepts the

proposition that identifying the matter of national concern is simply a matter of

identifying the pith and substance of the statute under review, which can, as here,

include legislative means. Indeed, the majority says it must be so; one must always be

the same as the other (paras. 115-16). But accepting this view effectively confines

Parliament to that particular legislative means in responding to the matter of national

concern. This would be unprecedented and undesirable. The arguments of the

Attorneys General of Canada and of British Columbia illustrate this point.

[355]

The Attorney General of Canada urges us to find that the matter of national

concern to be recognized under POGG is precisely the same as its proposed pith and

substance of the law, namely, “establishing minimum national standards integral to

reducing nationwide GHG emissions”. The Attorney General of British Columbia

similarly urges us to accept the matter of national concern in the same terms as his

proposed pith and substance of the law: “. . . establishing minimum national pricing

standards to allocate part of Canada’s targets for GHG emissions reduction”. To be

clear, then, each of these submissions couple a description of the legislative means

(minimum national standards) with the purpose of the law.

[356]

Considering first the Attorney General of Canada’s proposed matter of

national concern, I have already explained that it is not a court’s place to consider

whether regulatory measures are “effective” or “integral”. Doing so is no more

appropriate at the classification step than it is at the characterization step ⸺ and, in any

event, the efficacy of legislation is irrelevant to distinguishing an area of distinctly

federal jurisdiction from that of provincial jurisdiction. What is of greater significance

here is the invocation, common to the proposals of the Attorney General of Canada and

the Attorney General of British Columbia, of “minimum national standards”. As I have

also explained, when used to characterize the pith and substance of the Act, this phrase

is empty and misleading, and it can be rejected for that reason alone. But reliance upon

“minimum national standards” is even less tenable as a proposed matter of national

concern. Indeed, its acceptance as such would work pernicious effects on federalism.

[357]

By way of explanation, the Attorney General of Canada urges us in his

factum to find that a matter formerly under provincial jurisdiction is “transformed”

(how, he does not say) into a matter of national concern when “minimum national

standards” are invoked. This is simply not possible. Were it so, Parliament could

unilaterally create an area of distinctly federal jurisdiction from matters that fall within

exclusive provincial jurisdiction simply by doing the very thing that exclusive

provincial jurisdiction was intended to preclude: legislating a national standard in

respect of that matter. So understood, every subject matter listed under s. 92 of the

Constitution Act, 1867 could be viewed as having a national component. The

possibilities are endless: “minimum national standards” governing hospital and health

care administration; “minimum national standards” governing the availability of

bilingual municipal services; “minimum national standards” governing the location or

construction of hydroelectric generating stations; “minimal national standards” of

second-language education in public schools; or “minimum national standards”

governing the content of public school courses in 18th century Canadian history.

[358]

For this to serve as a basis for recognizing that some aspect of an area of

provincial jurisdiction is truly and distinctly “national” in scope, and therefore actually

lies outside provincial jurisdiction, “is to create something out of nothing and to subject

every area of provincial jurisdiction to the potential setting of national standards that

denude provincial power” (D. Newman, “Federalism, Subsidiarity, and Carbon Taxes”

(2019), 82 Sask. L. Rev. 187, at p. 199). It represents a model of supervisory federalism.

This is all but acknowledged by my majoritarian colleagues who, in minimizing the

Act’s effects on provincial authority, repeatedly stress that provinces are “free” to

“implement their own GHG pricing mechanisms”, to “prescribe any rules for provincial

pricing mechanisms”, to “design and legislate any GHG pricing system”, or to “design

any GHG pricing system they choose” ⸺ but then adding, every time, the caveat “as

long as” (or “provided”) they are “sufficiently stringent” to meet “the

federally-designated standards”, or “targets” (paras. 27, 61, 65, 72, 79, 81, 178, 179,

183, 186, 200 and 206 (emphasis added)). In other words, the provinces can exercise

their jurisdiction however they like, as long as they do so in a manner that the federal

Cabinet also likes. And yet, “[e]nsuring provincial compliance with Parliament’s

wishes” is hardly an appropriate basis for recognizing a new matter of national concern

(J. Hunter, “Saving the Planet Doesn’t Mean You Can’t Save the Federation:

Greenhouse Gases Are Not a Matter of National Concern” (2021), 100 S.C.L.R. (2d)

59, at p. 79).

[359]

Much the same can be said about British Columbia’s submission that

“allocat[ing] part of Canada’s targets for GHG emissions reduction” is an appropriate

matter of national concern. As I have already explained, this is not an accurate

description of the pith and substance of the Act. More to the point, however, the notion

of allocating national targets encounters the same objection as Canada’s minimum

national standards: it is an artifice which, once grafted onto matters that are plainly of

provincial jurisdiction (as the backstop scheme of the Act itself contemplates) adds

nothing. And like minimum national standards, it can be applied to open up any area

of provincial jurisdiction to unconstitutional federal intrusion once Parliament decides

to legislate uniform treatment in the form of mandatory, national “targets”. In this

sense, there is no difference between Parliament legislating national standards and

legislating national targets.

[360]

British Columbia responds to this concern by raising the provincial

inability test, coupled with a submission that, in most areas of provincial jurisdiction,

there is no need for Parliament to interfere by enacting national targets. This is because,

the argument goes, provincial legislation on such matters ⸺ for instance, education ⸺

has primarily intra-provincial impacts, such that the costs and benefits of the

legislature’s policy choice are felt principally within the province. Education is

therefore said to be unlike GHG emissions, since minimum national standards in

education “would not indivisibly address a provincial inability” (A.F., Attorney

General of British Columbia, at para. 49).

[361]

But this submission misconceives the proper focus of the provincial

inability test, a subject to which I will return below. For now, it suffices to observe that

the existence of extra-provincial impacts does not mean that uniform legislative

treatment is truly essential ⸺ as is made clear by considering, with reference to

Anti-Inflation, the extra-provincial inflationary impacts of intra-provincial economic

activities. It hardly seems likely that a similarly imaginative argument in that case about

imposing “minimum national standards” or “allocating national targets” related to the

containment and reduction of inflation would have moved Beetz J. from his conclusion

that inflation was inappropriate as a matter of national concern.

[362]

More fundamentally, I reject the idea that adding “minimum national

standards” or the “allocation of nationwide targets” to a proposed matter creates or

identifies a distinctly federal aspect of that matter. On this point, various parties

invoked the concept of “systemic risk”, borrowed from the securities references ⸺ as

indeed does the majority (at paras. 176 and 182) ⸺ to support a finding that the

proposed matter met the requirements of the provincial inability test. In the 2011

Securities Reference, this Court accepted that federal securities legislation engaged

trade as a whole (as is required under the trade and commerce power), but nevertheless

found that the law went too far by delving into “detailed regulation of all aspects of

trading in securities, a matter that has long been viewed as provincial” (para. 114

(emphasis in original)). A more focussed law that was “limited to addressing issues and

risk of a systemic nature that may represent a material threat to the stability of Canada’s

financial system” was later upheld in the Reference re Pan‑Canadian Securities

Regulation, 2018 SCC 48, [2018] 3 S.C.R. 189 (“2018 Securities Reference”) because

“the regulation of systemic risk in capital markets goes to promoting the stability of the

economy generally, not the stability of one economic sector in particular” (para. 111

(emphasis in original)).

[363]

The submission that the proposed matter is suitable as a matter of national

concern because it addresses the systemic risks of climate change has superficial

appeal. But this ignores fundamental differences between the respective analyses under

the POGG national concern doctrine and under the s. 91(2) trade and commerce power.

The federal power to regulate trade and commerce has no requirement for singleness,

distinctiveness and indivisibility. On the contrary, subjects like competition law or

systemic risk to capital markets can be diffuse and permeate the economy as a whole,

and yet still validly fall under the federal trade and commerce power (see, for instance,

para. 87 of the 2011 Securities Reference, which discusses the diffuse nature of the

competition law that was at issue in General Motors of Canada Ltd. v. City National

Leasing, [1989] 1 S.C.R. 641). “Systemic risk” is, therefore, an ill-fitting concept to

borrow from the s. 91(2) analysis.

[364]

Finally, I note that, in advancing an expansive national concern doctrine so

as to augment federal power, both the Attorney General of Canada and the majority

rush past s. 94 of the Constitution Act, 1867, which provides that “the Parliament of

Canada may make Provision for the Uniformity of all or any of the Laws relative to

Property and Civil Rights”. As that section makes clear, the Constitution already

contemplates that Parliament might wish to enact uniform laws related to property and

civil rights in the provinces, as it does by the Act. But s. 94 also imposes certain

constraints: it does not apply to Quebec and, in the provinces where it does apply, it

requires the consent of the provincial legislatures.

[365]

In other words, in bypassing s. 94 so as to embrace their centralized vision

of Canadian federalism, both the Attorney General of Canada and the majority would

(1) strip Quebec of its protection from federally imposed uniformity of laws relative to

property and civil rights, and (2) write out of the Constitution the requirement for

provincial consent elsewhere. This deprives the provinces, and Quebec in particular, of

part of the bargain negotiated among the partners, without which “the agreement of the

delegates from Canada East . . . could [not] have been obtained” (Reference re

Secession of Quebec, [1998] 2 S.C.R. 217, at paras. 36-37). As the Privy Council

recognized more generally in Attorney-General for Ontario v. Attorney-General for the

Dominion, [1896] A.C. 348, at p. 361, s. 94 “would be idle and abortive, if it were held

that the Parliament of Canada derives jurisdiction from the introductory provisions of

s. 91, to deal with any matter which is in substance local or provincial, and does not

truly affect the interest of the Dominion as a whole”.

[366]

It is no simple matter to tinker with the Constitution. This is why that task

is left by the amending formula to legislatures, who can deliberate upon the

complexities in depth, and not to courts which lack the necessary institutional

competencies to navigate those complexities ⸺ as here, where, by engorging federal

power as it does under the residual POGG power, the majority not only risks doing

violence to s. 92 (and, for that matter, to s. 92A), but also trips over s. 94.

[367]

This goes to a more fundamental point. As I will discuss below, both the

Attorney General of Canada and the majority speak of a “balance” ⸺ the Attorney

General of striking a “balance of federalism”, and the majority of a “federal-provincial

balance” (R.F., at para. 69 (emphasis deleted); Chief Justice’s reasons, at paras. 102,

117 and 134). But what my colleagues in the majority do not appreciate is that they are

undoing a balance. And that is because, as difficult as it may be for them to accept, the

“balance” that they presume to strike, and that they would have the judiciary strike in

future cases, has already been struck by Part VI of the Constitution Act, 1867

(“Distribution of Legislative Powers”). The role of the courts is not to strike a balance,

but to maintain and preserve the balance that is already recorded by our Constitution

in its division of powers. As this Court wrote in Reference re Firearms Act, “it is

beyond debate that an appropriate balance must be maintained between the federal and

provincial heads of power” (para. 48 (emphasis added)). Section 94, like ss. 91 and 92,

is part of a larger package that itself, and as a whole, reflects a “balance” that was

agreed to by both the federal and provincial levels of government or their colonial

predecessors.

[368]

Of course, re-balancing may occasionally be desirable or necessary ⸺

hence, for example, the negotiations that led to s. 92A, and hence certain particulars of

the amending formula. But when that need arises, if it arises, it is not in the gift of either

the Attorney General of Canada or of the Court to meet it. Indeed, their attempting to

do so simply upsets the balance ⸺ by, as here, effectively stripping Quebec of an

immunity held for over 150 years under the Constitution of Canada, which immunity

protected, among other things, Quebec’s rights to the use of civil law in private matters,

guaranteed nearly 250 years ago by the Quebec Act.

[369]

For all these reasons, the matters of national concern proposed by the

Attorneys General of Canada and British Columbia are constitutionally untenable.

While it is unnecessary to resolve here the question of whether a newly recognized

matter of national concern under POGG can ever be so narrowly defined to encompass

only the pith and substance of the impugned law (and including the legislative means),

I offer the following observations. As noted by Huscroft J.A., in dissent, describing the

new matter of national concern so narrowly in effect constitutionalizes the law under

review, and the particular means it adopts (2019 ONCA 544, 146 O.R. (3d) 65, at

para. 224). It also risks the analysis devolving into results-oriented thinking, which

must be avoided in the division of powers analysis (Chatterjee, at para. 16). Further,

Crown Zellerbach suggests that the broader approach is appropriate. Recall that once a

matter is recognized to be of national concern under POGG, Parliament is granted

an “exclusive jurisdiction of a plenary nature to legislate in relation to that matter,

including its intra-provincial aspects” (para. 433). This language suggests that, in

relation to a matter of national concern, Parliament is granted a scope of jurisdiction ⸺

and the ability to employ means ⸺ beyond that specifically contemplated by the law

under review.

[370]

All this said, I decline to conclude that, as a general proposition, it would

never be appropriate to describe a matter of national concern so narrowly as to

encompass only the law under review and the legislative means it employs. Still, in the

case at bar, a broad characterization of the national concern is unavoidable. Defining a

matter of national concern that encompasses both the reduction of GHG emissions by

raising the cost of fuel (Part 1) and the reduction of GHG emissions by pricing

emissions in a manner that distinguishes among industries based on emissions intensity

and trade exposure (Part 2) requires broad strokes. The legislative means employed by

Parts 1 and 2 are mutually distinct. Indeed, each is quite different from the other,

sharing only a purpose: the reduction of GHG emissions. This, and my conclusion

stated above that the definition of the matter of national concern should not tie

Parliament to a particular legislative means, tend to support the identification of the

matter said to be of national concern as the purpose of the Act: the reduction of GHG

emissions. The only remaining question, then, is whether the reduction of GHG

emissions satisfies the test stated in Crown Zellerbach for a valid national concern.

(b) Singleness, Distinctiveness and Indivisibility

[371]

“The reduction of GHG emissions” does not meet the requirements of

Crown Zellerbach. This would be so, even if it were appropriate to consider each of

the pith and substance of Parts 1 and 2 as proposed matters of national concern, since

the reduction of GHG emissions by raising the cost of fuel (Part 1) and by pricing

emissions in a manner that distinguishes among industries based on emissions intensity

and trade exposure (Part 2) each fail to meet the requirement of distinctiveness. Neither

of these matters is distinct from matters falling under provincial jurisdiction under s. 92.

I begin, therefore, by considering why the pith and substance of each of Parts 1 and 2,

respectively, fail to meet the requirement of distinctiveness (even if they were

appropriate matters of national concern). Then, I consider why the proper matter of

national concern as I understand it (“the reduction of GHG emissions”) fails to meet

the requirements of singleness and indivisibility.

(i)

The Pith and Substance of Each Part Is Not Distinct

[372]

Here again, the backstop model of the Act is of significance. The principal

difficulty in finding that the reduction of GHG emissions (whether by raising the cost

of fuel, or by pricing emissions in a manner that distinguishes among industries based

on emissions intensity and trade exposure) has the requisite distinctiveness to be

recognized as a matter of national concern is illustrated by the very quality of the

scheme that Parliament has legislated. Through the Act, Parliament encourages

provinces to enact substantially the same scheme to serve the same regulatory purpose

of altering behaviour. Again, this demonstrates that Parliament has legislated in respect

of a matter that falls within provincial legislative authority, specifically, ss. 92(10)

(local works and undertakings), (13) (property and civil rights), (16) (matters of a local

nature) and 92A (natural resources). The Act’s backstop scheme admits of no other

conclusion (Newman, at p. 197). This is much like Hydro-Québec, where the

legislation contained no opt-out for the provinces, but rather empowered the Governor

in Council to exempt provinces that had equivalent regulations in force (para. 57, per

Lamer C.J. and Iacobucci J., dissenting, but not on this point). The observations of

Lamer C.J. and Iacobucci J. on this point are therefore apposite:

The s. 34(6) equivalency provision also implicitly undermines the

appellant’s submission that the provinces are incapable of regulating

toxic substances. If the provinces were unable to regulate, there would be

even more reason for the federal government not to agree to withdraw

from the field. Section 34(6) demonstrates that the broad subject matter

of regulating toxic substances, as defined by the Act, is inherently or

potentially divisible. [para. 77]

[373]

Proponents of the Act urge us to find that, even if the Act and provincially

legislated GHG pricing schemes address the same matter, they each address different

aspects of that matter. This argument rests on the applicability of the double aspect

doctrine, whose application here the majority not only accepts but describes as

inevitable whenever minimum national standards are employed (Chief Justice’s

reasons, at paras. 125-31). But the majority is simply wrong ⸺ the double aspect

doctrine has no application here.

[374]

The double aspect doctrine arose because “some matters are by their very

nature impossible to categorize under a single head of power: they may have both

provincial and federal aspects” (Canadian Western Bank v. Alberta, 2007 SCC 22,

[2007] 2 S.C.R. 3, at para. 30). It therefore contemplates that “both Parliament and the

provincial legislatures can adopt valid legislation on a single subject depending on the

perspective from which the legislation is considered, that is, depending on the various

‘aspects’ of the ‘matter’ in question” (para. 30). Whether the doctrine applies to the

national concern doctrine of POGG is a question of some controversy, given this

Court’s statement in Crown Zellerbach that Parliament acquires “exclusive jurisdiction

of a plenary nature to legislate in relation to” the matter of national concern (p. 433;

see, for instance, Lacombe, at paras. 26-27). Assuming without deciding, however, that

the double aspect doctrine may, in some instances, apply to matters of national concern

recognized as such under POGG, it has no application here.

[375]

As the provinces clearly have jurisdiction to establish standards of GHG

price stringency in the province, this leaves as the only difference between the federal

aspect and the provincial aspect “minimum national standards”. Obviously, adopting

“minimum national standards” as part of the matter of national concern allows the

majority to invoke the double aspect doctrine, since it has defined the matter in terms

of something (enacting “national standards”) which, as a practical matter, only

Parliament could possibly do. And just as obviously, when the matter is defined in

terms of something only Parliament could possibly do, whatever it is that the provinces

are doing must be something different. This reasoning, however, could easily be applied

to create federal “aspects” of all sorts of matters falling within provincial jurisdiction.

Indeed, the majority suggests just that, acknowledging that whenever the device of

“minimum national standards” is used, a double aspect “will inevitably result”

(para. 129).

[376]

The device of minimum national standards, combined with the double

aspect doctrine, artificially meets many aspects of the Crown Zellerbach test, as diluted

by the majority. By definition, “minimum national standards”, being national, would

presumably, and in every case, qualify as “qualitatively different from matters of

provincial concern” and as “predominantly extraprovincial . . . in character” (Chief

Justice’s reasons, at para. 148). And, of course provinces, being provinces, are unable

to establish binding minimum national standards (para. 182). Further, because the Act

leaves the provinces free to adopt their own schemes as long as (or provided) they meet

federal approval, the impact on provincial jurisdiction is “qualified and limited”

(paras. 198, 205 and 211). In short, the device of “minimum national standards”, where

applied, deprives the majority’s framework of much of its “exacting” quality.

[377]

It is, however, this simple. While the double aspect doctrine “allows for the

concurrent application of both federal and provincial legislation, . . . it does not create

concurrent jurisdiction” (2011 Securities Reference, at para. 66 (underlining added)).

Like the POGG power itself, the double aspect doctrine must be carefully constrained

and applied with caution, because its casual and undisciplined application in the

majority’s reasons runs the near-certain risk that ss. 91 and 92 of the Constitution Act,

1867 will be merged into a “concurrent field of powers governed solely by the rule of

paramountcy of federal legislation” (Bell Canada v. Quebec (Commission de la santé

et de la sécurité du travail), [1988] 1 S.C.R. 749, at p. 766). It was for this very reason,

in Bell Canada, that Beetz J. cautioned that the doctrine “must not be [used] to create

concurrent fields of jurisdiction . . . in which Parliament and the legislatures may

legislate on the same aspect”; rather, it must be applied only “where the multiplicity of

aspects is real and not merely nominal” (p. 766 (emphasis in original)).

[378]

Nearly all of the parties and intervenor Attorneys General ⸺ aside from

the Attorneys General of Canada, New Brunswick and British Columbia ⸺ expressed

concerns about the application of the double aspect doctrine here. The Attorney General

of Quebec offers a particularly compelling and constitutionally sound encapsulation of

the problem with the majority’s invocation of the double aspect doctrine in this case,

and of the damage to the federation that will follow. The Attorney General of Quebec

⸺ no stranger to carbon pricing and legislative action to mitigate climate change ⸺

says that the proposed matter does not contemplate two aspects of the same matter;

rather, it contemplates the same aspect of the same matter. And because the provinces

may legislate in this area only where such legislation meets the criteria unilaterally set

by the federal government, defining the matter so as to artificially conjure a double

aspect effectively amounts to a transfer of jurisdiction from the provinces to the federal

government. This was, of course, also the point of the majority of the Court of Appeal

of Alberta: the Act purports to do exactly what the provinces can do, and for precisely

the same reason (2020 ABCA 74, 3 Alta. L.R. (7th) 1, at para. 209). There are simply

no distinctly federal aspects of the reduction of GHG emissions that cannot be divided

among the enumerated heads of power. And describing the imposition of “minimum

national standards” as the distinctly federal aspect of the matter simply brings us back

to the arguments that, as I have already explained, get the Attorney General of Canada

nowhere. Since such matters fall squarely within provincial jurisdiction, they cannot be

matters of “national concern”, given that POGG is a residual power.

(ii)

“The Reduction of GHG Emissions” Is Not Single or Indivisible

[379]

It is, of course, true that aspects of “the reduction of GHG emissions” may

be distinct from matters listed in s. 92. Like “inflation” or “the environment”, its nature

is inherently diffuse, and it therefore would not entirely fall within provincial

jurisdiction. Aspects of “the reduction of GHG emissions” would likely come within,

for instance, exclusive federal powers over trade and commerce, navigation and

shipping, and interprovincial or international works and undertakings (ss. 91(2) and

(10) and 92(10)).

[380]

But this is of no assistance to the majority here. While aspects of “the

reduction of GHG emissions” may be distinct from matters falling under s. 92, as a

matter of national concern it still fails to meet the Crown Zellerbach requirements of

singleness and indivisibility. In Crown Zellerbach, it was “not simply the possibility or

likelihood of the movement of pollutants across [the boundary between the territorial sea

and the internal marine waters of a state]”, but “the difficulty of ascertaining by visual

observation” that boundary that meant uniform legislative treatment was required for

marine pollution (p. 437). This proposition could not be clearer. The matter was

indivisible in that case not because pollutants might cross an invisible boundary; rather,

the matter was indivisible because of the difficulty of knowing the source and physical

location (federal territorial seas vs. provincial inland waters) of the pollution at any given

time, and therefore whose regulatory and penal provisions might apply.

[381]

Here, however, the territorial jurisdiction from which GHG emissions are

emitted is readily identifiable. The matter is divisible, because whenever fuel is

purchased, or an industrial activity is undertaken, no question arises as to physical

location and, therefore, no difficulty arises in identifying whose jurisdiction might

apply. Responsibility for the reduction of GHG emissions among the provinces can

therefore be readily identified for regulation at the source of such emissions. This is not

a concern which, absent exclusive federal jurisdiction, the provinces could not

address. Rather, both Parliament and the provinces may within their respective spheres

of legislative authority “operate in tandem” to reduce GHG emissions (Hydro-Québec,

at para. 59). The reduction of GHG emissions therefore lacks the degree of unity

required to qualify as an indivisible matter of national concern.

[382]

My majoritarian colleagues say that I have overstated the regulatory

uncertainty aspect of Le Dain J.’s reasoning in Crown Zellerbach. They say that there

are many routes to establishing indivisibility (at para. 193), and I agree, as does my

colleague Rowe J. (see para. 548). My point is not that regulatory uncertainty is a

precondition to finding a matter of national concern. Rather, it is that, where the matter

in question otherwise lacks specificity and unity — as is the case here, where the matter

under consideration is the reduction of GHG emissions, as opposed to, for instance, the

matter in Munro — the fact that harms may cross borders is not enough to make out

indivisibility. Something more is required, and in Crown Zellerbach, that was the

regulatory and penal uncertainty stemming from an inability to know the jurisdiction in

which the pollution had been dumped (p. 437), since the crane depositing the woodwaste

in that case was mobile, fixed as it was on a scow. That uncertainty is absent here, and so

relying on cross-border harms is simply not enough to make out indivisibility. The

emission of GHGs, whether from a factory or an automobile, can be connected to the

source province. GHG emissions are therefore divisible. This understood, “nationwide

GHG emissions” are nothing more than the sum of provincial and territorial GHG

emissions (Hunter, at pp. 75-76).

[383]

Of course, uniform legislative treatment in the area of GHG emissions

reduction might be desirable, as it might assist Canada in meeting its international

commitments in relation to GHG emission targets. But the desirability of uniform

treatment is hardly the marker of a matter of national concern. Here, the

non-participation of one province does not prevent any other province from reducing

its own GHG emissions. While a provincial failure to deal effectively with the control or

regulation of GHG emissions may cause more emissions from that province to cross

provincial boundaries, that is precisely what this Court held was insufficient to meet

the requirement of indivisibility in Crown Zellerbach. To be clear, even if this could

be said to meet the provincial inability test ⸺ that is, even if Crown Zellerbach could

be read as understanding “provincial inability” as including a provincial failure to act

⸺ my conclusion on this point would not change. This is because, properly understood

⸺ and contrary to the framework developed by the majority ⸺ the provincial inability

test is but one indicium of singleness and indivisibility.

[384]

Further, I agree with the majority at the Court of Appeal of Alberta, at

para. 324, that

there is no evidence on this record that anything any one province does

or does not do with respect to the regulation of GHG emissions is going to

cause any measurable harm to any other province now or in the foreseeable

future. . . . The atmosphere that surrounds us all is affected largely by what

is being done, or not being done, in other countries. Four large countries or

groups of countries, the United States, China, India and the European

Union generate, cumulatively, 55.5% of the world’s GHG emissions.

[385]

Obviously, uniform legislative treatment might be desirable in that it could

alleviate concerns about carbon leakage. But, and again as the Court of Appeal of

Alberta observed, the evidence on this record of the harms of interprovincial carbon

leakage is equivocal at best. Indeed, it tends to suggest that, in most sectors and for

most provincial economic activity, such concerns are insignificant (E. Beale, et al.,

Provincial Carbon Pricing and Competitiveness Pressures, November 2015 (online),

at p. II; Working Group on Carbon Pricing Mechanisms, Final Report, fn. 23; Sask.

C.A. reasons, at para. 155, per Richards C.J.S.). This falls well short of establishing the

majority’s peremptory assertion that uniform treatment is essential to address carbon

leakage concerns (paras. 183 and 186). And in the absence of actual evidence on this

point, the majority’s implicit proposition that Part 2 of the Act is desirable to address

concerns about carbon leakage asks us to judge the wisdom of this particular policy

choice, something that has no bearing on the analysis.

[386]

In sum, the reduction of GHG emissions as a matter of national concern

fails to meet the requirements of singleness and indivisibility. Like the containment and

reduction of inflation, the reduction of GHG emissions

is an aggregate of several subjects some of which form a substantial part

of provincial jurisdiction. It is totally lacking in specificity. It is so

pervasive that it knows no bounds. Its recognition as a federal head of

power would render most provincial powers nugatory.

(Anti-Inflation, at p. 458)

(c)

Scale of Impact

[387]

Even were the reduction of GHG emissions a single and indivisible area of

jurisdiction, its impact on provincial jurisdiction would be of a scale that is completely

irreconcilable with the division of powers.

[388]

The power to legislate to reduce GHG emissions effectively authorizes an

array of regulations, “the boundaries of [which] are limited only by the imagination”

(Sask. C.A. reasons, at para. 128). It extends to the regulation of any activity that

requires carbon-based fuel, including manufacturing, mining, agriculture, and

transportation. Indeed, Part 2 of the Act, much like the impugned law in the 2011

Securities Reference, descends into the detailed regulation of industrial GHG emissions

reduction by imposing different carbon prices on different industrial activities. As

Huscroft J.A. recognized, in dissent, the power to create minimum standards for GHG

emissions could potentially authorize minimum standards related to home heating and

cooling, public transit, road design and use, fuel efficiency, manufacturing and farming

prices (Ont. C.A. reasons, at para. 237).

[389]

Unlike previously recognized matters of national concern, including

aeronautics, the development and conservation of the national capital region, atomic

energy and marine pollution, the power to legislate to reduce GHG emissions has the

potential to undo Canada’s division of powers. It is in this respect comparable to the

broad topics of environmental regulation and inflation, which this Court has expressly

refused to recognize as independent legislative subjects. GHG emissions simply cannot

be treated as a single regulatory matter, “because no system in which one government

was so powerful would be federal” (D. Gibson, “Constitutional Jurisdiction over

Environmental Management in Canada” (1973), 23 U.T.L.J. 54, at p. 85).

[390]

In an attempt to minimize the scale of impact on provincial jurisdiction, the

Attorney General of British Columbia reminds us that the Act does not forbid any

activity, but only increases the cost of certain activities. The Act, he argues, is not about

regulation, but pricing; it does not allow the federal Cabinet to determine who may emit

GHGs or set conditions on how they do it, but rather allows anyone to emit GHGs if

they pay for it (A.F., at paras. 19-21). It follows, on this reasoning, that any impact on

provincial jurisdiction is minimal, particularly compared to what it might have been

had Parliament resorted to its criminal law power, for instance, to prohibit GHG

emissions.

[391]

The majority adopts this line of argument, describing “establishing

minimum national standards of GHG price stringency to reduce GHG emissions” as an

exclusively “pricing-based formulation” of the Act’s pith and substance (para. 57). As

it explains, “the focus of the [Act] is on national GHG pricing” (para. 60; see also

para. 70). In so concluding, the majority stresses that “the [Act] does not require those

to whom it applies to perform or refrain from performing specified GHG emitting

activities”, or “tell industries how they are to operate in order to reduce their GHG

emissions” (para. 71). Rather, it says, the Act simply “require[s] persons to pay for

engaging in specified activities that result in the emission of GHGs” (para. 71) — in

other words, “just paying money”.

[392]

This view ignores two problems. First, “just paying money” is an odd way

of describing the impact of a law. The goal of the financial charges — “just paying

money” — is to influence behaviour, in this case both consumer and industrial. And

that is precisely the point. As Canada’s Ecofiscal Commission observed during oral

submissions, Part 2 of the Act “uses pricing to achieve its environmental goals”

(transcript, day 2, at p. 77). Further, poised as they are to affect the cost of fuel and

dictate the viability of emissions-intensive trade-exposed industries, the charges

imposed by the Act stand to have a profound effect on provincial jurisdiction and the

division of powers.

[393]

The point is that “just paying money” hardly captures the intended impact

of the Act, let alone its potential impact. And yet, this is central to the efforts of the

Act’s proponents, including the majority, to downplay what the law actually does.

Indeed, the majority takes matters even further, by stressing how minimally, in its view,

the Act actually impacts provincial autonomy. Provinces, observes the majority, may

still choose any type of carbon pricing regime they wish. “[F]lexibility and support for

provincially designed GHG pricing schemes” remain the order of the day, and

provinces are “free to design and legislate any GHG pricing system” they wish, “as

long as”, of course, their schemes are “sufficiently stringent” and meet the

federally-designated standards (Chief Justice’s reasons, at paras. 79 and 200 (emphasis

added)). This leads to an impact on provincial jurisdiction that is, in their view, “strictly

limited” (para. 200). This, like the flawed idea that the Act is just about paying money

⸺ as opposed to the discouragement or prohibition of an activity ⸺ informs much of

the majority’s classification analysis. It is simply unsustainable.

[394]

The second problem with the “just paying money” line of defence is that

the contrasting degree of potential impact on provincial jurisdiction of a hypothetical

law validly promulgated under Parliament’s criminal law power, or its taxation power

for that matter, has absolutely no bearing on whether another matter should be

recognized as a matter of national concern. Contrary to the submissions of the

Attorneys General of Canada and British Columbia at the hearing of these appeals, the

Constitution does not require provinces to happily accept a severe intrusion on their

jurisdiction under POGG simply because Parliament could have passed a criminal law.

Likewise, an intrusion into provincial jurisdiction is no less severe simply because it

leaves the provinces with authority to enact more stringent regulatory requirements.

This argument misses the point of the division of powers analysis, which ⸺ pace the

majority ⸺ allows no recourse to balancing or proportionality considerations. The

Constitution Act, 1867 does not permit federal overreach as long as it preserves

provincial autonomy to the greatest extent possible. It sets out spheres of exclusive

jurisdiction. It divides powers ⸺ exclusive powers ⸺ between Parliament and the

provincial legislatures. And within their sphere of jurisdiction, the provincial

legislatures are sovereign, which sovereignty connotes provincial power to act ⸺ or

not act ⸺ as they see fit, not as long as they do so in a manner that finds approval at

the federal Cabinet table (see H. Cyr, “Autonomy, Subsidiarity, Solidarity: Foundations

of Cooperative Federalism” (2014), 23 Const. Forum 20, at pp. 21-22). The very idea

of recognizing federal jurisdiction to legislate “minimum national standards” of matters

falling within provincial jurisdiction is corrosive of Canadian federalism.

(3) Other Sources of Federal Legislative Authority

[395]

While the Attorney General of Canada focused his submissions on the

national concern doctrine, at the conclusion of his factum he pleads, in the alternative,

that “Part 1 of the Act is validly enacted under Parliament’s taxation power” and,

further, that “the entire Act is validly enacted under the emergency branch of

Parliament’s POGG power, Parliament’s criminal law power, or other existing heads

of power, as argued by various Interveners” (R.F., at paras. 167-68 (emphasis added)).

Yet, no actual argument is advanced by the Attorney General on any of those potential

sources of Parliament’s authority, or for that matter on anything other than the national

concern branch of POGG. Indeed, that appears to have been the basis upon which

Parliament understood itself as proceeding since, when asked during debate about the

Act’s constitutionality, the reply of the Minister of Environment and Climate Change

was to identify that climate change was a “national concern” (Debates of the Senate,

vol. 150, No. 275, 1st Sess., 42nd Parl., April 2, 2019, at p. 7714 (Hon. Catherine

McKenna)). But now, in a storm, any port will apparently do.

[396]

Despite the Attorney General’s evident lesser degree of commitment here,

I now turn to address the various sources of federal authority “argued by various

Interveners”.

(a) Gap Branch of POGG

[397]

Several interveners urged us to consider the gap branch of the POGG power

as a possible source of federal jurisdiction for the Act. For instance, the intervener

Athabasca Chipewyan First Nation submitted that the three branches of POGG must

be read “fluidly” and that the “scientific newness” of climate change — being a matter

unknown at the time of Confederation — should militate in favour of the validity of

the Act. A version of this idea finds support in academic scholarship. Professor

Newman, for instance, suggests that POGG’s national concern branch and gap branch

are one and the same (pp. 195-96 and fn. 47).

[398]

I agree with Rowe J. that the case law does not support a distinction

between the “gap” and “national concern” branches of POGG. Regardless of whether

the “gap” branch is understood as housing “new” matters that did not exist at the time

of Confederation or as requiring a lacuna in the text of the Constitution, all such matters

must still pass the national concern test. As such, the scientific newness of climate

change has no bearing on my analysis. As I have already explained, resort to this branch

of POGG is not possible here, given that the pith and substance of each of Parts 1 and

2 of the Act are properly classified under provincial heads of power.

(b) Emergency Branch of POGG

[399]

The emergency branch of POGG was also proposed as a possible basis for

federal authority by several interveners including the David Suzuki Foundation, the

Canadian Labour Congress, the Intergenerational Climate Coalition, the Athabasca

Chipewyan First Nation, and the National Association of Women and the Law and

Friends of the Earth. It is curious that the majority does not consider this, since its

reasons speak in such terms, describing climate change as “an existential challenge[,]

a threat of the highest order to the country, and indeed to the world” (para. 167; see

also paras. 187, 190, 195 and 206). Further, the emergency branch’s requirement of

temporariness means that the majority’s unconstitutional transfer of jurisdiction from

the provinces to Parliament would do less damage to Canadian federalism, and for less

time, lasting only until this crisis passes.

[400]

It is a problem for the Act ⸺ although presumably a problem that

Parliament could have corrected had it wished to proceed in reliance upon the

emergency power ⸺ that it does not expressly provide for temporary operation. As I

have already recounted, however, the Act by its terms is intended to change behaviour.

The preamble to the Act anticipates what will follow: “. . . increased energy efficiency,

. . . the use of cleaner energy, . . . the adoption of cleaner technologies and practices

and . . . innovation . . . .” In other words, while the Act does not come with a “best

before” date, it does contemplate an end. And while at the outset of an emergency it

will often be difficult or impossible to identify with any precision when it might end,

the emergency branch has been applied in circumstances where it is reasonably

apparent that the emergency will, at some point, end. Indeed, the point of action is

presumably to do what is necessary to ensure that the emergency will end. For that

reason, “Invocation of exceptional measures is typically justified on the basis that the

ordinary system is not up to handling the threat and that, once the crisis passes, the

usual state of affairs can and will return” (S. Burningham, “The New Normal”:

COVID-19 and the Temporary Nature of Emergencies, June 4, 2020 (online) (emphasis

added)).

[401]

This is not to suggest that Parliament would have lacked “a rational basis”

to act here, as required by the caselaw on the emergency branch. Rather, my point is

that the Attorney General has not done the necessary (or any) work to show that

Parliament justifiably relied upon its emergency power as a source of its authority. This

stands in contrast to Anti-Inflation, where Parliament manifested such reliance (by

specifying an expiration date), and where the Attorney General of Canada made full

argument on the point (pp. 383-84 and 417-18).

[402]

find that the Act’s temporary character is to be found in its preambular references to

Canada’s commitments under the Paris Agreement, U.N. Doc.

I should add that the intervener the David Suzuki Foundation urges us to

FCCC/CP/2015/10/Add.1, December 12, 2015, and that those commitments come with

the clear deadline of 2030. Hence, the intervener submits, the Act implies a 10-year

timeline to achieve required reductions, and it urges us to read in that deadline, by

designating an end date to the jurisdiction of Parliament to authorize the Act (I.F.

(38663 and 38781), at para. 36). While this is an intriguing proposition, considering

time-delimited jurisdiction in the emergency doctrine analysis would require a

departure from this Court’s jurisprudence. It would also ask this Court to attempt to

forecast when a given emergency may end, an issue usually left to Parliament (and

rightly so, given the relative institutional competencies). The current record before this

Court is inadequate to support designating 2030 as a suitable end date, or any other

year for that matter, for Parliament to lose legislative competency in this area.

[403]

Furthermore, the role of this Court ⸺ the Attorney General of Canada’s

concluding sentences of his factum notwithstanding ⸺ is not to root around the

Constitution or constitutional doctrine to scrounge up some basis, any basis, to rescue

federal legislation. (This is particularly so where, as here, the exceptional residual

authority of POGG is contemplated and the dominant subject matter of the impugned

statute is consigned by our Constitution to the provinces.) The proper question to ask

is, therefore, not whether the Act is potentially salvageable under the emergency branch

of POGG, but rather whether Parliament, in passing the Act, did so relying on its

legislative authority under the emergency branch of POGG. Both the response of the

Minister of Environment and Climate Change to a question about the source of

Parliament’s authority, and the submissions of the Attorney General of Canada, make

clear that it did not.

(c) Criminal Law

[404]

The criminal law power can be addressed briefly. While the precise scope

of this power remains uncertain in this Court’s jurisprudence, it is tolerably clear that

its exercise requires a legislated prohibition that is accompanied by a penalty and

backed by a criminal law purpose (Reference re Genetic Non-Discrimination Act, 2020

SCC 17, at para. 67). As I have explained, however, the pith and substance of the Act

relates to a scheme of monetary disincentives intended to discourage, rather than

prohibit, certain activity. The offences and penalties in the Act are incidental to its true

regulatory nature and, accordingly, the criminal law power is not applicable.

(d) Taxation

[405]

The Attorneys General of Saskatchewan and Ontario argue that Part 1 of

the Act imposes a tax, and ask this Court to conclude that the Act violates the principle

of no taxation without representation, which principle is guaranteed by s. 53 of the

Constitution Act, 1867 (see Ontario English Catholic Teachers’ Assn. v. Ontario

(Attorney General), 2001 SCC 15, [2001] 1 S.C.R. 470, at para. 71).

[406]

Section 91(3) of the Constitution Act, 1867 authorizes the federal

government to raise money by any mode or system of taxation, which provides broad

jurisdiction to impose both direct and indirect taxation. But as broad as the taxing

authority is, it is “subject to the ordinary principles of classification and colourability

that apply to all legislative powers” (Hogg, at p. 31-2 (footnotes omitted)). Not every

monetary levy is a tax. While monetary measures that relate in pith and substance to

the raising of revenue for federal purposes are classified as taxation (Re: Exported

Natural Gas Tax, [1982] 1 S.C.R. 1004, at p. 1070; see also Westbank First Nation v.

British Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134, at para. 30), other

monetary measures are regulatory charges that must be supported by some other head

of power (Westbank, at para. 23; Exported Natural Gas Tax, at p. 1068).

[407]

This Court has stated the relevant criteria for distinguishing between a tax

and a regulatory charge. One consideration applied in the most recent cases has been

that regulatory charges are typically connected to a broader regulatory scheme (see,

e.g., Westbank, at paras. 44-45; 620 Connaught Ltd. v. Canada (Attorney General),

2008 SCC 7, [2008] 1 S.C.R. 131, at paras. 30-47). And so here, the Attorneys General

of Saskatchewan and Ontario argue that the fuel charge under Part 1 of the Act is not

connected to a broader regulatory scheme. While that is so, it is not dispositive, since

regulatory charges need not always be connected to a broader scheme. In particular,

there are cases where the charge itself is the scheme (Westbank, at para. 32).

[408]

What is dispositive, in my view, is whether the charge is implemented

primarily for a regulatory purpose, as opposed to a revenue-raising purpose. If so, the

charge should be considered regulatory (Westbank, at para. 32; Exported Natural Gas,

at p. 1070). In Exported Natural Gas, this Court concluded that one such regulatory

purpose is to generally discourage certain behaviour (p. 1075). While the Attorney

General of Ontario argues that we should not be so quick to label charges as regulatory,

the conclusion I reach supports Canada’s division of powers. It “would afford the

Dominion an easy passage into the Provincial domain” were every monetary measure

to be regarded as a tax (Attorney-General for Canada v. Attorney-General for Ontario,

[1937] A.C. 355 (P.C.), at p. 367).

[409]

As I have explained, the charges imposed by the Act, in pith and substance,

relate to the regulatory purpose of changing behaviour, for the broader purpose of

reducing GHG emissions. The Act’s provisions reveal that it does not relate to the

raising of revenue for federal purposes. It is therefore unnecessary to consider s. 53 of

the Constitution Act, 1867.

(4) Broad Delegation to the Cabinet

[410]

As a final comment to my analysis of the constitutionality of the Act, I

observe that the provinces arguing against the Act’s constitutionality placed significant

emphasis on the scope of delegated authority found within it. This emphasis is

understandable, as the sweep of delegation granted by the Act to the Cabinet is

breathtakingly broad. Indeed, the Act goes so far as to delegate authority to amend

portions of the Act itself through a Henry VIII clause (s. 168(3) and (4); see also Sask.

C.A., at paras. 361-66, per Ottenbreit and Caldwell JJ.A., dissenting). The majority

notes this, but then speaks reassuringly of how the federal Cabinet’s discretion is

constrained by the purposes of the Act and specific guidelines in the statute, and how

any listing decision by federal Cabinet can be judicially reviewed (paras. 72-76).

[411]

But this is an incomplete response. The majority does not mention that

failure to comply with the purposes of an enabling statute such as the Act would signify

not only that the impugned regulations are ultra vires the enabling statute, but that it

may also be repugnant to the division of powers. Nor does the majority explain just

how a court is to review regulations for compliance with the division of powers.

[412]

Further, the examples given by the majority of how a regulation may fail

to conform to the purposes of the Act are not enlightening. For example, the majority

posits that federal Cabinet “could not list a fuel . . . that does not emit GHGs when

burned” (para. 75). That may be so, but what the majority might also have wished to

consider is the obvious possibility that the federal Cabinet will discriminate against

provinces or industries in a way that has nothing to do with “establishing minimum

national standards of GHG price stringency to reduce GHG emissions”. Indeed, this is

a particular risk with Part 2 which, as I have explained, does not exist to establish such

standards.

[413]

In the absence of useful guidance from the majority on this point, I endorse

that provided by Rowe J., both as to the imperative that the division of powers ⸺ no

less than the purposes of the Act ⸺ confines the exercise by the federal Cabinet of

Parliament’s delegated authority, and as to the appropriate methodology for reviewing

regulations for compliance with the division of powers.

[414]

Further, my brevity on this issue should not be taken as agreement with the

majority’s response to my colleague Côté J.’s reasons on this point. Indeed, the

majority largely misses the point, treating the matter of the Henry VIII clause as simply

one of administrative law (since regulatory decisions can be judicially reviewed),

ignoring the potentially significant separation of powers concerns that Côté J.

identifies. I see those concerns as raising serious questions which, given my conclusion

on the Attorney General of Canada’s reliance on the national concern doctrine, are

unnecessary for me to decide here.

IV. Canada’s Proposed “Modernization” of Crown Zellerbach

[415]

While counsel before us did not advance this submission, the Attorney

General of Canada urges us in his factum to “modernize” the national concern doctrine

under POGG in an effort to make it easier for matters ⸺ including the one proposed

here ⸺ to be recognized under the doctrine. I respond to it here because aspects of the

proposal were adopted by my colleagues in the majority.

[416]

Instead of speaking about a new matter or a provincial matter that has a

national aspect, the Attorney General of Canada speaks of matters having been

“transform[ed]” in a way that is “constitutionally significant” (R.F., at para. 69). How

a matter is “transformed” ⸺ and, who or what does the “transforming” ⸺ is not

explained. Nor is it explained what “constitutional significance” requires.

[417]

This is, I observe with as much regret as astonishment, an unserious

submission from the chief law officer of the federal Crown. The Attorney General of

Canada has a responsibility to the whole country to support and act within, not ignore

or undermine, Canada’s federal structure: “Because the [Attorney General] is the chief

law officer of a democratic government, she must be a guardian of the rule of law. As

such, the [Attorney General] is held to a standard of accountability that is unique, that

extends beyond the standard that applies to an ordinary litigant” (F. Hawkins, “Duties,

Conflicts, and Politics in the Litigation Offices of the Attorney General” (2018), 12

J.P.P.L. 193, at p. 193). As noted by Professor K. Roach, “[t]he Constitution . . .

imposes and entrenches special restraints and obligations on the government as part of

the supreme law of the land” (“Not Just the Government’s Lawyer: The Attorney

General as Defender of the Rule of Law” (2006), 31 Queen’s L.J. 598, at p. 610).

[418]

Federalism is an essential feature of our Constitution. The Attorney

General of Canada must defend it, not undermine it by casually and recklessly urging

upon this Court some vaguely conceived notion of “transformation”, so meaningless as

to effectively deprive the provinces of the opportunity to respond substantively to it,

but yet so clearly intended to effect the expansion of federal jurisdiction.

[419]

Beyond the cant of “transformation”, the most we have by way of a

concrete proposal from the Attorney General on this point is that a national concern

must be “distinctly national”, as measured by the provincial inability test borrowed

from the general branch of the federal trade and commerce power, and that it must be

reconcilable with the division of powers (or, as the Attorney General now calls it, “the

balance of federalism”; R.F., at para. 69 (emphasis deleted)).

[420]

It is on the first of those considerations ⸺ that a national concern must be

“distinctly national” ⸺ that I wish to focus, since it is embraced by the majority in its

dilution of the Crown Zellerbach test (para. 177). This abandons this Court’s

jurisprudence, since ⸺ under Crown Zellerbach ⸺ provincial inability is but one

indicator of singleness, distinctiveness and indivisibility, while under Canada’s

proposed framework it becomes the singular test for distinctiveness (R.F., at para. 70).

[421]

The respective tests for provincial inability, as set down for the national

concern branch of POGG in Crown Zellerbach and for the trade and commerce power

in General Motors, are different from each other. In Crown Zellerbach, Le Dain J.

described the provincial inability test as an inquiry into “the effect on extra-provincial

interests of a provincial failure to deal effectively with the control or regulation of the

intra-provincial aspects of the matter”, a threshold that would be met “whenever a

significant aspect of a problem is beyond provincial reach because it falls within the

jurisdiction of another province or of the federal Parliament” (p. 432, citing Gibson

(1976), at p. 34). In General Motors, however, Dickson C.J. described the provincial

inability test in the fourth and fifth factors of the analysis under the general branch of

the federal trade and commerce power as follows: “. . . the legislation should be of a

nature that the provinces jointly or severally would be constitutionally incapable of

enacting” and “. . . the failure to include one or more provinces or localities in a legislative

scheme would jeopardize the successful operation of the scheme in other parts of the

country” (p. 662).

[422]

It is important to note that, despite being released one year after Crown

Zellerbach, the Court in General Motors made no reference to Crown Zellerbach, or to

its test for provincial inability under the national concern doctrine of POGG. Presumably,

it did not occur to the Court to do so, since each test has its own aim, distinct from the

other. The General Motors test for provincial inability focusses on the prospect of a

legislative scheme not working unless it is national in scope. By contrast, the Crown

Zellerbach test for provincial inability is firmly focussed on the nature of the problem as

being one which cannot be overcome without national action. This is fatal to the Attorney

General of Canada’s submission. As I have already explained, while this Court held in the

2018 Securities Reference that legislation aimed at “systemic risk in capital markets” can

meet the test for provincial inability under the General Motors factors (paras. 111, 113

and 115), it does not follow that “systemic risk in capital markets” is a matter sufficiently

singular, distinctive and indivisible to make it an appropriately recognized matter of

national concern under POGG. Legislation that passes the General Motors test can be

aimed at a problem that is diffuse — such as the elimination of anti-competitive behaviour

— yet still engage trade as a whole.

[423]

Provincial inability, as an indicium of singleness, distinctiveness and

indivisibility, was intended in Crown Zellerbach to confine POGG as a residual power

by filtering matters that could fit under any enumerated head of power, including trade

and commerce. The point is that, by its residual nature, the national concern branch of

POGG must not include matters that satisfy the trade and commerce test. Hence, while

the control of systemic risk was recognized as a valid federal objective under the trade

and commerce power in the 2018 Securities Reference, it would not qualify as a

national concern under POGG, failing under “distinctiveness” (since it falls under the

trade and commerce power) and “indivisibility” (because of its pervasive and diffuse

character).

[424]

The Attorney General of Canada’s argument on this point is also revealing.

The proposed “modernized” framework includes the General Motors provincial

inability test, squarely aimed at provincial legislative inability, as the sole criterion to

determine whether a matter is “distinctly national”. And this is because such a

framework would support Canada’s submission that the provinces acting in concert

would be legislatively unable to pass mandatory minimum national standards related

to GHG emissions. But such an approach ignores the important statement in Crown

Zellerbach that the provincial inability test is but “one of the indicia for determining

whether a matter has that character of singleness or indivisibility required to bring it

within the national concern doctrine” (p. 434).

[425]

As the above analysis suggests, Canada’s proposed framework would make

it easier for a matter to be recognized as a national concern under POGG whenever

minimum national standards are said to be required. The departure from this Court’s

jurisprudence that Canada proposes ⸺ and that the majority pronounces ⸺ would

therefore enable the federal government to more easily invade provincial jurisdiction,

and has the potential to upset the fundamental distribution of legislative power under

the Constitution.

[426]

As Abella and Karakatsanis JJ. forcefully expressed in their concurring

judgment in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC

65, the doctrine of “[s]tare decisis places significant limits on this Court’s ability to

overturn its precedents” (para. 255). While the Court was divided in Vavilov about

whether those strictures were satisfied, the point is that horizontal stare decisis

promotes certainty and predictability in the development of the law, contributes to the

integrity of the judicial process and safeguards this Court’s institutional legitimacy

(paras. 260-61). If this applies to our statements of the law governing the standard by

which judges review the decisions of administrative tribunals, it surely applies to our

precedents on adjudicating the division of powers under the Constitution.

[427]

In my view, the high threshold for departing from the long-established

principles set down in Crown Zellerbach is not met here. And putting even that

determinative consideration aside, at the very least, and for the sake of doctrinal clarity,

I say with respect that the majority should acknowledge that it is completely re-writing

the framework for the national concern branch of POGG. Instead, it insists upon linking

its novel framework to Crown Zellerbach, as if its reasons represent not the confusing

and confused eliding of the constraints of Crown Zellerbach that I will now

demonstrate them to be, but as something of an inevitable and even obvious exegesis.

I turn, then, to the majority’s framework.

V. The Majority’s Dilution of Crown Zellerbach

[428]

The majority accepts aspects of the Attorney General of Canada’s proposal

to “modernize” the national concern doctrine, but takes it further still. And so ⸺

although this appears nowhere in this Court’s judgment in Crown Zellerbach ⸺ the

majority divines from that judgment, at paras. 142-66, the following “three-step

process” (para. 132):

1) Threshold question: is the matter of sufficient concern to Canada as a whole

to warrant consideration under the doctrine?

2) Singleness, distinctiveness and indivisibility: as this is not a “readily

applicable legal test”, the two “principles” that follow must be satisfied

(para. 146).

a. First, the matter must be “specific and identifiable” and “qualitatively

different from matters of provincial concern” (para. 146 (emphasis

added)).

Three factors or considerations may inform whether something is

“qualitatively different”:

i. Whether “the matter is predominantly extraprovincial and

international in its nature or its effects” (para. 151);

ii. Whether international agreements related to the matter exist; and

iii. Whether “the matter involves a federal legislative role that is

distinct from and not duplicative of that of the provinces”

(para. 151).

b. Secondly, federal jurisdiction should be recognized “only where the

evidence establishes provincial inability to deal with the matter” (para.

152).

Three factors must be present:

i. The “legislation should be of a nature that the provinces jointly

or severally would be constitutionally incapable of enacting”

(para. 152);

ii. The “failure to include one or more provinces or localities in a

legislative scheme would jeopardize the successful operation of

the scheme in other parts of the country” (para. 152); and

iii. A “province’s failure to deal with the matter must have grave

extraprovincial consequences” (para. 153).

3) Scale of impact: this requires the court to balance the intrusion on provincial

autonomy against the impact on other interests that will be affected if federal

jurisdiction is not granted.

[429]

As will be apparent from the above, the majority has accepted Canada’s

proposal that principles from the trade and commerce jurisprudence ought to be

adopted into the national concern analysis. But the majority adds additional elements

that were previously considered irrelevant to the national concern analysis. I will

discuss each of them in turn.

A. “Threshold Question”: Whether the Matter Is of Sufficient Concern to Canada

as a Whole

[430]

The majority’s new framework requires a reviewing court to ask whether

“the matter is of sufficient concern to Canada as a whole to warrant consideration under

the doctrine”, which, we are told “invites a common-sense inquiry into the national

importance of the proposed matter” (para. 142). While framed as “a threshold

question”, I observe that the importance of the matter implicitly permeates the entire

analysis, reappearing in the majority’s discussion of “scale of impact”, where that step

of the test is understood as an exercise in balancing “competing interests” (paras. 142

and 160).

[431]

My colleague Rowe J. addresses why importance should not be a relevant

consideration under “singleness, distinctiveness and indivisibility”. It therefore suffices

for me to stress two points here.

[432]

First, the majority reasons appear to suffer from the misconception that, if

a matter is important, it follows that it is a matter for Parliament and the federal

government. This is remarkably dismissive of provincial jurisdiction. I agree with

Professor Gibson, who says:

If importance of the subject matter is the measure of “national

dimensions” there can be little hope for federalism in Canada’s future.

Since there are very few functions of government which are not of great

importance, to grant federal jurisdiction over all such functions would be

to make the supposedly autonomous provincial legislatures mere “tenants

at sufferance” of the federal Parliament.

((1976), at p. 31)

[433]

Secondly, in considering the importance of the matter urged by the

Attorney General of Canada, the majority emphasizes that carbon pricing is “a

necessary tool”, an “essential elemen[t]”, and a “critical measure” (paras. 169-70). But

these considerations have no bearing on the division of powers. I acknowledge that the

majority might be taken as responding to this point by positioning this as only a

“threshold” question. Even so understood, however, the majority’s analysis allows the

efficacy or wisdom of a policy choice to colour the analysis that follows. It is, in effect,

a backdoor to injecting into the division of powers framework the judiciary’s views of

such matters. In a literal and dangerous sense, this risks politicizing the judiciary,

pulling it (as here) into expressing views not on the constitutionality of one side or

another on deeply contentious policy questions within the federation, but on their

merits.

B. Singleness, Distinctiveness and Indivisibility

[434]

The majority explains that the phrase “singleness, distinctiveness and

indivisibility” does not articulate a “readily applicable legal test” (para. 146). It should,

the majority says, therefore be understood in light of two “animating” principles:

“. . . first, federal jurisdiction based on the national concern doctrine should be found

to exist only over a specific and identifiable matter that is qualitatively different from

matters of provincial concern; and second, federal jurisdiction should be found to exist

only where the evidence establishes provincial inability to deal with the matter”

(para. 157).

(1) The First Principle: “A Specific and Identifiable Matter That Is

Qualitatively Different From Matters of Provincial Concern”

[435]

Under the principle that singleness, distinctiveness and indivisibility will

require “a specific and identifiable matter that is qualitatively different from matters of

provincial concern”, the majority identifies three factors “that properly inform th[e]

analysis” of whether something is “qualitatively different” (paras. 146-47).

[436]

The first factor is “whether [the matter] is predominantly extraprovincial

and international in character, having regard both to its inherent nature and to its

effects” (para. 148). It is far from clear what my colleagues in the majority understand

by a matter’s “inherent nature”. They appear to equate it with a matter’s “character and

implications” (para. 173). But the meaning of a matter’s “implications” is not explained

(aside from a reference to “serious effects that can cross provincial boundaries”, at

para. 148). And identifying a matter’s “predominantly extraprovincial and international

. . . character” by considering its “inherent nature” appears to veer into presupposing

the answer to the very question that the framework is intended to address: whether the

matter is a national concern. None of this is helpful.

[437]

The second factor is whether international agreements related to the matter

exist (para. 149). This, as Rowe J. makes plain, undermines Attorney-General for

Canada v. Attorney-General for Ontario, [1937] A.C. 326 (P.C.). Further, it serves as

no constraint whatsoever on the recognition of a national concern. That is, while the

absence of international agreements will not militate against recognition of a national

concern, the presence of such agreements — depending on their content — may

support recognition of a national concern.

[438]

The third factor is “whether the matter involves a federal legislative role

that is distinct from and not duplicative of that of the provinces” (para. 151). Here, the

majority says that this factor is satisfied, because the Act works “on a distinctly national

basis” ⸺ echoing the language urged upon us by the Attorney General of Canada ⸺

in establishing minimum national standards to meet Canada’s obligations under the

Paris Agreement, which constitutes a federal role in pricing that is qualitatively

different from matters of provincial concern (para. 177).

[439]

In other words, the majority says that “minimum national standards” can

qualify as a national concern under POGG because, inter alia, they work in a national

way. But this simply illustrates how the concept of minimum national standards has

been employed to create a federal aspect of the matter out of thin air. How else, after

all, would national standards work, if not nationally? This consideration adds nothing

to the analysis, and therefore achieves nothing except to facilitate the recognition of

Parliament’s legislative authority over a matter simply by casting Parliament as doing

something that Parliament almost always does: legislating in a national way, by

creating minimum national standards.

[440]

None of this supports the majority’s reference to having developed an

“exacting” test with “meaningful barrier[s]” (para. 208). Rather, and as I have already

observed, it is a departure from Crown Zellerbach that operates not to constrain the

recognition of POGG matters, but effectively to facilitate it via the artifice of

“minimum national standards”.

[441]

In its dilution of the national concern test, the majority has lost sight of

what that test is supposed to achieve: the identification of matters that are distinctive

(being different from those falling under any other enumerated power, and thus beyond

the constitutional powers of the provinces to address), and indivisible (being a matter

for which responsibility cannot be divided between Parliament and the provinces).

While the majority’s “principle” of “qualitativ[e] differen[ce] from matters of

provincial concern” (para. 146) echoes Crown Zellerbach’s requirement of

distinctiveness, its three “factors” in effect adulterate that requirement to the point that

there is no principle left. Almost any provincial head of power is open to federal

intrusion simply by recasting the federal matter as one of “minimum national

standards”.

[442]

This leaves, of course, Crown Zellerbach’s requirement of indivisibility ⸺

which is nowhere accounted for in the majority’s dilution. While the majority does

caution that “the matter must not be an aggregate of provincial matters” and insists that

the “requirement of indivisibility is given effect through [the two] principles” set out

in their framework (at paras. 150 and 158), this does not capture the concerns of

Beetz J. in Anti-Inflation. In that case, Beetz J. explained that matters like inflation are

aggregates of subjects coming under federal and provincial jurisdiction, and that they

lack a degree of unity that makes them indivisible. The point is that many matters, like

inflation, are qualitatively distinct from provincial heads of power, but they still do not

qualify as a national concern under POGG because they are not indivisible, since they

can be divided between both orders of government. Yet, and as Rowe J. explains, the

majority now allows for such matters to be subsumed under federal jurisdiction as a

national concern, thereby discarding Beetz J.’s careful, compelling and (until now)

important judgment in Anti-Inflation.

(2) The Second Principle: “Federal Jurisdiction Should Be Found to Exist

Only Where the Evidence Establishes Provincial Inability to Deal With the

Matter”

[443]

The majority says that “federal jurisdiction should be found to exist only

where the evidence establishes provincial inability to deal with the matter” (para. 152).

The “starting point” for this analysis, says the majority, is the understanding of

provincial inability stated in the fourth and fifth indicia from the General Motors test

(para. 152). To this, they add that “a province’s failure to deal with the matter must

have grave extraprovincial consequences” (para. 153). These three factors must be

satisfied to meet the criterion of provincial inability, which is now a necessary but

insufficient condition for the recognition of a matter of national concern (para. 156).

[444]

I have already described the problem with using principles from the trade

and commerce jurisprudence in the national concern analysis in responding to the

submissions on this point from the Attorney General of Canada, which is that reliance

on the test governing the federal trade and commerce power is inappropriate; the tests

for provincial inability are different, and the point of the provincial inability analysis

was ⸺ before now ⸺ to filter out matters that could fit under any enumerated head of

power, so that POGG would be truly residual. But there are other problems with this

“principle”, as stated by the majority.

[445]

First, by forcing trade and commerce jurisprudence into the national

concern test, the majority requires constitutional incapacity to establish provincial

inability (para. 182). The majority analogizes to the 2018 Securities Reference, in

which provincial legislation addressing systemic risk was considered unsustainable

because of the ability of the provinces to withdraw at any time. But it will always be

the case that provinces are unable to fetter themselves against future legislative action.

This requirement is therefore meaningless.

[446]

Secondly, in discussing the final requirement, the need for “grave

extraprovincial consequences”, the majority furnishes examples which are indeed

grave, including serious harm to human life, contagious disease, and arms trafficking

(paras. 153-55). But the majority fails to link those grave consequences to provincial

inability, properly understood. And this is because the majority does not appear to

appreciate that the extra-provincial effects must be such that all or part of the matter is

beyond the scope of provinces’ legislative authority under s. 92 to address, whether

independently or in tandem.

[447]

Finally, the majority also stresses the requirement of “grave extraprovincial

consequences” as demonstrating the “exacting” nature of its test (paras. 155, 208-9 and

211). But this standard is peremptory, almost uselessly subjective and susceptible to

change (as the majority’s description of the extra-provincial harm in Munro as

“meaningful” makes clear (para. 154)). And far from constraining federal intrusion,

this standard effectively invites it into other areas of provincial jurisdiction whose

exercise could also cause “grave extraprovincial consequences”, such as public health

and pandemic response (pace the majority’s reference to “one province’s failure to deal

with health care”, at para. 209), the management of provincial public lands, the

construction of hydroelectric dams, the development and management of

non-renewable and forestry resources, the inflationary effects of intra-provincial trade

and commerce (including the regulation of wages and prices) and the management of

prisons. Simply put, the gravity of the extra-provincial consequences should not and

(until now) has not dictated the outcome of the provincial inability test.

[448]

For my part, rather than dilute Crown Zellerbach so as to assure the Act’s

constitutionality, I consider myself bound by its understanding of provincial inability.

The reason why is illustrated by this Court’s decision in Anti-Inflation. While

controlling inflation could undoubtedly meet aspects of the provincial inability test ⸺

in the sense that part of the matter is beyond the scope of provincial legislative authority

to address ⸺ this Court held that controlling inflation does not qualify as a matter of

national concern, because it is divisible (“an aggregate of several subjects”, at p. 458).

In other words, it is possible for a matter to be characterized by provincial inability,

while still failing to satisfy the requirement of singleness, distinctiveness and

indivisibility. This surely means that, where extra-provincial effects are such that all or

part of a matter is beyond provincial legislative power to address, this is an indicator

⸺ but no more ⸺ that the matter may be distinct from provincial jurisdiction and have

extra-provincial aspects that are indivisible from its local and private aspects. In other

words, the insight of Crown Zellerbach obtains: consistent with the residual nature of

POGG, federal usurpation of what was formerly within provincial jurisdiction is

possible only where a matter has become distinct from what the provinces can do, and

yet cannot be separated from what the provinces can do. In such a case, resort to POGG,

and in particular its national concern branch, is necessary to preserve the

exhaustiveness of the division of powers.

C. Scale of Impact

[449]

The final step in the majority’s diluted reformulation of the test for national

concern requires the reviewing court to determine “whether the matter’s scale of impact

on provincial jurisdiction is acceptable having regard to the impact on the interests that

will be affected if Parliament is unable to constitutionally address the matter at a

national level” (para. 196). The “impact on provincial jurisdiction” is considered, then

weighed against other “interests”, which requires the court to “balance competing

interests” (para. 160). This is yet another departure from Crown Zellerbach, in which

this Court said that a matter of national concern must have “a scale of impact on

provincial jurisdiction that is reconcilable with the fundamental distribution of

legislative power under the Constitution” (p. 432). Curiously, while the majority cites

to this passage, it then abandons it, seeking to reconcile the impact on provincial

jurisdiction not with the division of powers, but with the importance that the reviewing

judge ascribes to other “interests” (para. 206).

[450]

The judicial role in federalism disputes is properly confined to identifying

the boundaries set by the Constitution that separate federal from provincial jurisdiction.

In the context of considering the “scale of impact”, this entails looking to the scope of

provincial powers affected and the impact on the relative autonomy of Parliament and

provinces. It also requires carefully considering the contours of the matter said to be of

national concern, as it is only where the matter has “ascertainable and reasonable

limits” that it can be said to have “a scale of impact on provincial jurisdiction that is

reconcilable with the fundamental distribution of legislative power” (Crown Zellerbach,

at pp. 432 and 438). Determining the contours of jurisdiction and the effects of legislation

is what courts do. The role of the judiciary, properly understood, does not extend to

evaluating the importance of other interests that could be affected if the provinces are

not supervised in the exercise of their jurisdiction. That is the stuff of policy-making,

not adjudication. This distinction, which appears to elude the majority, was once

thought uncontroversial at this Court (see Vriend v. Alberta, [1998] 1 S.C.R. 493, at

para. 136).

[451]

But the real problem with my colleagues’ scale of impact analysis is their

significant understatement of the intrusion into provincial jurisdiction effected by the

Act. It will be recalled that the majority finds that the impact on provincial jurisdiction

is limited, in part because the “impact on the provinces’ freedom to legislate is

minimal” and “strictly limited”, since provinces “are free to design and legislate any

GHG pricing system as long as it meets minimum national standards of price

stringency” (paras. 199-200 (emphasis added)). As I have noted, this ignores the

detailed industrial regulations authorized by Part 2 of the Act. But it also ignores that

the federal benchmark is not static, and can be set to an increasingly stringent level so

as to correspondingly narrow provincial jurisdiction in the field. It is only by ignoring

such things that the majority is able to claim that the federal power that it recognizes

here is “significantly less intrusive than [that recognized] in Crown Zellerbach”

(para. 201).

[452]

More fundamentally, and even if federalism were a thing whose terms were

not constitutionally enshrined but could instead be judicially balanced, the majority’s

overall approach is not one of balance. Rather, the majority puts its thumb heavily on

the federal side of the scale ⸺ by legitimating as a national concern the device of

“minimum national standards” on matters of importance that otherwise fall within

provincial jurisdiction, and by insisting that doing so still preserves provincial

autonomy (as long as it is exercised in accordance with federal priorities). Parliament

now knows how to ensure that the balance will always tip its way, whenever provinces

choose to exercise their legislative authority in a way that impedes the federal agenda.

[453]

Even the Attorney General of Canada was not so bold as to ask for a

weighted scale, much less a redefined framework that accounts for other interests that

should have no bearing on the division of powers. And yet, the majority has given him

just that.

VI. Conclusion

[454]

The Act’s subject matter falls squarely within provincial jurisdiction. It

cannot be supported by any source of federal legislative authority, and it is therefore

ultra vires Parliament. This Court, a self-proclaimed “guardian of the constitution”

should condemn, not endorse, the Attorney General of Canada’s leveraging of the

importance of climate change ⸺ and the relative popularity of Parliament’s chosen

policy response ⸺ to fundamentally alter the division of powers analysis under ss. 91

and 92 of the Constitution Act, 1867 and, ultimately, the division of powers itself

(Hunter v. Southam Inc., [1984] 2 S.C.R. 145, at p. 155).

[455]

The majority’s reasons for judgment are momentous, and their implications

should be fully and soberly comprehended. This Court once maintained that the

Constitution, underpinned as it is by the principle of federalism, “demands respect for

the constitutional division of powers” (2011 Securities Reference, at para. 61; see also

Reference re Secession of Quebec, at paras. 56 and 58). But in its unfortunate judgment,

the majority discards that constitutionally faithful principle for a new, distinctly

hierarchical and supervisory model of Canadian federalism, with two defining

characteristics: (1) the subjection of provincial legislative authority to Parliament’s

overriding authority to establish “national standards” of how such authority may be

exercised; and (2) the replacement of the constitutionally mandated division of powers

with a judicially struck balance of power, which balance must account for other

“interests”.

[456]

No province, and not even Parliament itself, ever agreed to ⸺ or even

contemplated ⸺ either of these features. This is a model of federalism that rejects our

Constitution and re-writes the rules of Confederation. Its implications go far beyond

the Act, opening the door to federal intrusion ⸺ by way of the imposition of national

standards ⸺ into all areas of provincial jurisdiction, including intra-provincial trade

and commerce, health, and the management of natural resources. It is bound to lead to

serious tensions in the federation. And all for no good reason, since Parliament could

have achieved its goals in constitutionally valid ways. I dissent.

The following are the reasons delivered by

ROWE J. —

[457]

The national concern doctrine is a residual power of last resort. I have come

to this view through a close reading of R. v. Crown Zellerbach Canada Ltd., [1988] 1

S.C.R. 401, and the cases that preceded it. Faithful adherence to the doctrine leads

inexorably to the conclusion that the national concern branch of the “Peace, Order, and

good Government” (“POGG”) power cannot be the basis for the constitutionality of the

Greenhouse Gas Pollution Pricing Act, S.C. 2018, c. 12, s. 186 (“Act”).

[458]

My focus is mainly doctrinal. To attain the objectives sought by the federal

structure, and for courts to be accountable to the public in how they exercise their power

as umpires in federalism disputes, doctrinal coherence, clarity and predictability

regarding the division of powers are essential (Canadian Western Bank v. Alberta, 2007

SCC 22, [2007] 2 S.C.R. 3, at para. 23; Quebec (Attorney General) v. 9147-0732

Québec inc., 2020 SCC 32, at para. 3).

[459]

First, I discuss the principle of federalism and the division of powers: the

starting point for a complete understanding of the national concern doctrine. Second, I

discuss the residual and circumscribed nature of the POGG power, rooted in s. 91 of

the Constitution Act, 1867. While some commentators refer to the existence of three

branches of POGG — gap, national concern, and emergency — in my view, the case

law does not support a distinction between “gap” and “national concern”, nor is such a

distinction useful. Rather, what commentators refer to as “gap” and “national concern”

is better understood as one manifestation of the cumulatively exhaustive nature of the

division of powers, and the residual nature of POGG. Third, I apply this understanding

to the national concern test set out in Crown Zellerbach, and interpret the concepts of

“singleness, distinctiveness and indivisibility”, “provincial inability” and “scale of

impact on provincial jurisdiction” accordingly (p. 432). The national concern doctrine

applies only to matters that are distinct from those falling under provincial jurisdiction

and that cannot be distributed between the existing powers of both orders of

government. In addition, their recognition under POGG cannot upset the federal

balance. Fourth, I compare this approach to the approach urged on us by the Attorney

General of Canada. Finally, I address an entirely distinct matter: the methodology for

reviewing regulations for compliance with the division of powers and how it may apply

to regulations made under the Act. In the result, for these reasons and those of Justice

Brown, which I adopt, the legislation is ultra vires in whole.

I.

Federalism and the Division of Powers

[460]

This case requires a careful consideration of one of the fundamental

underlying principles animating the Canadian Constitution: federalism (Reference re

Secession of Quebec, [1998] 2 S.C.R. 217, at para. 32). The “primary textual

expression” of the principle of federalism can be found in the division of powers

effected mainly by ss. 91 and 92 of the Constitution Act, 1867 (Secession Reference, at

para. 47; Reference re Genetic Non-Discrimination Act, 2020 SCC 17 (“Reference re

GNDA”), at para. 20).

[461]

An essential characteristic of the distribution of powers is its

exhaustiveness, which precludes legislative voids (Reference re Same-Sex Marriage,

2004 SCC 79, [2004] 3 S.C.R. 698, at para. 34; Quebec (Attorney General) v. Canada

(Attorney General), 2015 SCC 14, [2015] 1 S.C.R. 693, at para. 44). Exhaustiveness

reconciles parliamentary sovereignty and federalism: it ensures that there is no subject

matter which cannot be legislated upon and that Canada, as a whole, is fully sovereign.

[462]

The principle of federalism pursues some well-known objectives: “to

reconcile unity with diversity, promote democratic participation by reserving

meaningful powers to the local or regional level and to foster co-operation among

governments and legislatures for the common good” (Canadian Western Bank, at

para. 22). The distribution of powers, in turn, was not random; rather, it was designed

to achieve these objectives. It accommodates diversity between provinces — by

allocating considerable powers to provincial legislatures to allow them pursue their

own interests — and their desire for unity — by granting powers to Parliament when

they share a common interest (Secession Reference, at paras. 58-59; Reference re

GNDA, at para. 21). The federal structure protects the separate identities of the

provinces from being subsumed under a unitary state.

[463]

The federal structure was an essential condition for Confederation. Many

provinces would not have supported the project of Confederation without the adoption

of a federal form (Secession Reference, at para. 37; see also Attorney-General

for Canada v. Attorney-General for Ontario, [1937] A.C. 326 (P.C.) (“Labour

Conventions”), at pp. 351-53). In other words, “[w]ithout federalism, Canada could not

have formed or endured” (Newfoundland and Labrador (Attorney General) v.

Uashaunnuat (Innu of Uashat and of Mani-Utenam), 2020 SCC 4, at para. 240, per

Brown and Rowe JJ., dissenting). Consequently, courts interpreting the division of

powers must be careful not “to dim or to whittle down” the provisions of the

Constitution Act, 1867, and its underlying values, or “impose a new and different

contract upon the federating bodies” through an exercise of interpretation (In re

Regulation and Control of Aeronautics in Canada, [1932] A.C. 54 (P.C.) (“Aeronautics

Reference”), at p. 70).

[464]

The Canadian federation guarantees the autonomy of both orders of

government within their spheres of jurisdiction. Their relationship is one of

coordination between equal partners, not subordination (Reference re Securities

Act, 2011 SCC 66, [2011] 3 S.C.R. 837 (“Securities Reference”), at para. 71; see also

Liquidators of the Maritime Bank of Canada v. Receiver-General of New Brunswick,

[1892] A.C. 437 (P.C.), at pp. 442-43). The guarantee of provincial autonomy to

facilitate the pursuit of collective goals has particular salience for a province like

Quebec, “where the majority of the population is French-speaking, and which

possesses a distinct culture” (Secession Reference, at para. 59; see also Labour

Conventions, at pp. 351-52).

[465]

Autonomy, rather than subordination, entails that provinces have the right

to “legislate for themselves in respect of local conditions which may vary by as great a

distance as separates the Atlantic from the Pacific” (Labour Conventions, at p. 352).

As Professor Pigeon (as he then was) explained:

The true concept of autonomy is thus like the true concept of freedom.

It implies limitations, but it also implies free movement within the area

bounded by the limitations: one no longer enjoys freedom when free to

move in one direction only. It should therefore be realized that autonomy

means the right of being different, of acting differently. This is what

freedom means for the individual; it is also what it must mean for

provincial legislatures and governments. There is no longer any real

autonomy for them to the extent that they are actually compelled,

economically or otherwise, to act according to a specified pattern. Just as

freedom means for the individual the right of choosing his own objective

so long as it is not illegal, autonomy means for a province the privilege of

defining its own policies. [Emphasis added.]

(“The Meaning of Provincial Autonomy” (1951), 29 Can. Bar Rev. 1126,

at pp. 1132-33)

[466]

Thus, federalism recognizes that “there may be different and equally

legitimate majorities in different provinces and territories and at the federal level”

(Secession Reference, at para. 66).

[467]

Embracing differences between the provinces also has instrumental value.

Allocating powers to the provinces may produce policies tailored to local realities,

since provinces are “closest to the citizens affected and thus most responsive to their

needs, to local distinctiveness, and to population diversity” (114957 Canada Ltée

(Spraytech, Société d’arrosage) v. Hudson (Town), 2001 SCC 40, [2001] 2 S.C.R. 241,

at para. 3; see also D. Newman, “Federalism, Subsidiarity, and Carbon Taxes” (2019),

82 Sask. L. Rev. 187, at pp. 192-93). In addition, provinces can serve as “social

laborator[ies]” when they enact innovative legislative policies that can be “tested” at

the local level (P. W. Hogg, Constitutional Law of Canada (5th ed. Supp. (loose-leaf)),

vol. 1, at s. 5.2, referring to New State Ice Co. v. Liebmann, 285 U.S. 262 (1932), at

p. 311, per Brandeis J.).

[468]

The judiciary is charged with delimiting the sovereignties of both orders of

government, guided by the “lodestar” of the principle of federalism (Secession

Reference, at para. 56; Securities Reference, at para. 55). More specifically, in R. v.

Comeau, 2018 SCC 15, [2018] 1 S.C.R. 342, this Court explained that “[t]he tension

between the centre and the regions is regulated by the concept of jurisdictional balance”

(para. 78 (emphasis added)).

[469]

Division of powers disputes must be resolved in a way that reconciles unity

and diversity. This cannot be achieved by merely determining which order of

government “is thought to be best placed to legislate regarding the matter in question”

(Securities Reference, at para. 90). Functional effectiveness is often erroneously

equated with centralization and uniformity and eclipses the value of regional diversity

(see, e.g., J. Leclair, “The Supreme Court of Canada’s Understanding of Federalism:

Efficiency at the Expense of Diversity” (2003), 28 Queen’s L.J. 411). As Professor

Beetz (as he then was) explained:

[TRANSLATION] As a result, Quebec jurists can only be suspicious of the

argument that, for example, legislative authority must be commensurate

with the problem to be resolved. They find, first of all, that this is not a

legal argument, but a political and functional reason to amend the

constitution if necessary. Next, they find, from a political standpoint, that

it is a permanent argument, one that is favorable to a concentration of

powers in the federal government, since the problems to be resolved will

obviously not stop increasing in intensity, in complexity and in their

ramifications. [Emphasis added; footnote omitted.]

(“Les Attitudes changeantes du Québec à l’endroit de la Constitution

de 1867”, in P.-A. Crépeau and C. B. Macpherson, eds., The Future of

Canadian Federalism (1965), 113, at p. 120)

[470]

Rather than the functional approach, Professor Beetz argued for

[TRANSLATION] “further development and clarification of concepts, [and for] analytical

jurisprudence” (p. 120). This is consistent with the view that at every step of the

analysis, courts must assess “constitutional compliance, not policy desirability”

(Comeau, at para. 83).

[471]

In recent years, this Court has adopted a flexible, cooperative conception

of the division of powers. This approach accommodates overlap between valid

exercises of federal and provincial authority and encourages intergovernmental

cooperation (Reference re GNDA, at para. 22; Reference re Pan-Canadian Securities

Regulation, 2018 SCC 48, [2018] 3 S.C.R. 189, at para. 18).

[472]

Cooperative federalism, however, cannot override the division of powers

or “make ultra vires legislation intra vires” (Reference re Pan-Canadian Securities

Regulation, at para. 18; see also Rogers Communications Inc. v. Châteauguay (City),

2016 SCC 23, [2016] 1 S.C.R. 467, at para. 39). Moreover, while it encourages

cooperation between orders of government, it does not impose it

(J.-F. Gaudreault-DesBiens and J. Poirier, “From Dualism to Cooperative Federalism

and Back? Evolving and Competing Conceptions of Canadian Federalism”, in

P. Oliver, P. Macklem and N. Des Rosiers, eds., The Oxford Handbook of the Canadian

Constitution (2017), 391, at p. 391; Securities Reference, at paras. 132-33). Finally,

precise and stable definitions of the powers of the two orders of government are an

essential precondition to cooperative federalism. Without them, the “respective

bargaining positions of the two levels of government will be too uncertain for

federal-provincial agreements to be reached” (W. R. Lederman, “Unity and Diversity

in Canadian Federalism: Ideals and Methods of Moderation” (1975), 53 Can. Bar

Rev. 597, at p. 616).

[473]

Respect for the principle of federalism is essential in deciding these

appeals. This Court is called to determine, primarily, if the Act can be upheld as an

exercise of Parliament’s authority to enact laws under the national concern doctrine.

This involves consideration of the purposes sought by the choice of a federal structure,

the logic of the distribution of powers, and a careful examination of the jurisdictional

balance between both orders of government.

II. POGG Is Residual and Circumscribed

[474]

The Attorney General of Canada seeks to uphold the Act as a valid exercise

of Parliament’s jurisdiction under the national concern doctrine of its “Peace, Order,

and good Government” power. The exhaustive nature of the division of powers,

discussed above, means that matters that do not come within the enumerated classes

must fit somewhere. This is dealt with by two residual clauses: one federal, and one

provincial.

[475]

The federal residual clause, which I refer to as the “Peace, Order, and good

Government” or “POGG” power, comes from the opening words of s. 91 of the

Constitution Act, 1867: