620 Connaught Ltd. et al. v. Canada (Attorney General) et al., (2008) 371 N.R. 200 (SCC)

• Judge: McLachlin, C.J.C., Bastarache, Binnie, LeBel, Deschamps, Fish, Abella, Charron and Rothstein, JJ.
• Court: Supreme Court (Canada)
• Case Date: November 16, 2007
• Jurisdiction: Canada (Federal)
• Citations: (2008), 371 N.R. 200 (SCC);2008 SCC 7;371 NR 200;[2008] SCJ No 7 (QL);74 Admin LR (4th) 1;164 ACWS (3d) 81;290 DLR (4th) 385;JE 2008-500;[2008] 1 SCR 131;EYB 2008-130229

620 Connaught Ltd. v. Can. (A.G.) (2008), 371 N.R. 200 (SCC)

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Temp. Cite: [2008] N.R. TBEd. FE.011

620 Connaught Ltd., operating as Downstream Bar, 263053 Alberta Ltd., operating as Miss Italia Ristorante, 313769 Alberta Ltd., operating as Jasper House Bungalows, 659510 Alberta Ltd., operating as Buckles Restaurant and Saloon, Alex Holdings Ltd., operating as Something Else Restaurant, Alpine Grill Ltd., operating as Alpine Grill Restaurant, Athabasca Motor Hotel (1972) Ltd., operating as Athabasca Hotel, Lina and Claudio Holdings Ltd., operating as Beckers Gourmet Restaurant, Cantonese Restaurant Ltd., Earls Restaurant (Jasper) Ltd., Fiddle River Seafood Company Ltd., George Andrew & Sons Ltd., operating as Astoria Hotel Company Limited, Glacier International Ltd., operating as Whistlers Inn, Husereau Restaurant Holdings Inc., operating as Tekarra Restaurant, Jasper Inn Investment Ltd., operating as The Inn Restaurant, Kabos Holding Ltd., operating as Karouzos Steakhouse, Kontos Investments Ltd., operating as Kontos Restaurant, L & W Vlahos Holdings Ltd., operating as L & W Restaurant, La Fiesta Restaurant Ltd., Larry Holdings Ltd., operating as Mount Robson Restaurant, Maligne Tours Ltd., Sawridge Enterprises Inc., operating as Sawridge Inn & Conference Center, T.C Restaurants Ltd., operating as Villa Caruso Steak House & Bar and Tonquin Prime Rib Village Ltd. (appellants) v. Attorney General of Canada, Minister of Environment, Superintendent of Jasper National Park and Parks Canada Agency (respondents) and Attorney General of Ontario (intervenor)

(31661; 2008 SCC 7; 2008 CSC 7)

Indexed As: 620 Connaught Ltd. et al. v. Canada (Attorney General) et al.

Supreme Court of Canada

McLachlin, C.J.C., Bastarache, Binnie, LeBel, Deschamps, Fish, Abella, Charron and Rothstein, JJ.

February 29, 2008.

Summary:

The appellants owned businesses in Jasper National Park which served alcoholic beverages. In order to operate those establishments, the appellants required a business licence, for which they had to pay a fee based on a percentage of their annual alcohol purchases. The business licence fee was imposed under the authority granted to the Minister of Canadian Heritage pursuant to s. 24 of the Parks Canada Agency Act to "fix the fees or the manner of calculating fees in respect of products, rights or privileges provided by the [Parks Canada] Agency". The appellants applied for a declaration that the licence fees were invalid and ultra vires the Minister of Canadian Heritage. At issue was whether the business licence fee was a regulatory charge or a tax. Pursuant to s. 53 of the Constitution Act, 1867, only Parliament could impose a tax. If the business licence fee was a tax, it was ultra vires and beyond the Minister's jurisdiction to impose.

The Federal Court, in a decision reported at 274 F.T.R. 311, dismissed the application. The court held that the fee was a regulatory charge and was therefore validly imposed. The appellants appealed.

The Federal Court of Appeal, in a decision reported at 352 N.R. 177, dismissed the appeal. The appellants appealed.

The Supreme Court of Canada dismissed the appeal. The business licence fees paid by the appellants were, in pith and substance, regulatory charges and were therefore intra vires the delegated power of the Minister of Canadian Heritage.

Constitutional Law - Topic 2950

Determination of validity of statutes or acts - Pith and substance - General principles - [See second Constitutional Law - Topic 5763 ].

Constitutional Law - Topic 5763

Federal jurisdiction (s. 91) - Taxation - What constitutes a tax - The appellants owned businesses in Jasper National Park which served alcoholic beverages - At issue on their appeal was whether the annual business licence fee for the right to sell alcoholic beverages imposed on hotels, restaurants and bars in Jasper National Park was a regulatory charge or a tax - The Supreme Court of Canada discussed the distinction between a tax and a regulatory charge - The court stated that "In summary, if there is a regulatory scheme and it is found to be relevant to the person being regulated under step one, and there is a relationship between the levy and the scheme itself under step two, the pith and substance of the levy will be a regulatory charge and not a tax. In other words, the dominant features of the levy will be its regulatory characteristics. Therefore, the questions to ask are: (1) Have the appellants demonstrated that the levy has the attributes of a tax? and (2) Has the government demonstrated that the levy is connected to a regulatory scheme? To answer the first question, one must look to the indicia established in Lawson [S.C.C.]. To answer the second question, one must proceed with the two-step analysis in Westbank [S.C.C.]" - See paragraph 28.

Constitutional Law - Topic 5763

Federal jurisdiction (s. 91) - Taxation - What constitutes a tax - The appellants owned businesses in Jasper National Park which served alcoholic beverages - At issue on their appeal was whether the annual business licence fee for the right to sell alcoholic beverages imposed on hotels, restaurants and bars in Jasper National Park was a regulatory charge or a tax - The business licence fee was imposed under the authority granted to the Minister of Canadian Heritage pursuant to s. 24 of the Parks Canada Agency Act to "fix the fees or the manner of calculating fees in respect of products, rights or privileges provided by the [Parks Canada] Agency" - Pursuant to s. 53 of the Constitution Act, 1867, only Parliament could impose a tax - If the business licence fee was a tax, it was ultra vires and beyond the Minister's jurisdiction to impose - The Supreme Court of Canada held that the business licence fees paid by the appellants were, in pith and substance, regulatory charges and were therefore intra vires the delegated power of the Minister of Canadian Heritage - The business license fees were connected to a regulatory scheme and there was a relationship between the business licence fees paid by the appellants and that regulatory scheme - In the result, the pith and substance or dominant purpose of the business licence fees was as regulatory charges - See paragraphs 24 to 50.

Constitutional Law - Topic 7001

Provincial jurisdiction (s. 92) - Licences and user fees - General - [See both Constitutional Law - Topic 5763 ].

Crown - Topic 6879

Crown lands - National and provincial parks - Park use permits and licences (incl. fees) - [See second Constitutional Law - Topic 5763 ].

Cases Noticed:

Eurig Estate v. Ontario Court (General Division), Registrar, [1998] 2 S.C.R. 565; 231 N.R. 55; 114 O.A.C. 55, appld. [para. 5].

Eurig Estate, Re - see Eurig Estate v. Ontario Court (General Division), Registrar.

Westbank First Nation v. British Columbia Hydro and Power Authority, [1999] 3 S.C.R. 134; 246 N.R. 201; 129 B.C.A.C. 1; 210 W.A.C. 1, appld. [para. 17].

Allard Contractors Ltd. et al. v. Coquitlam (District) et al., [1993] 4 S.C.R. 371; 160 N.R. 249; 35 B.C.A.C. 241; 57 W.A.C. 241, refd to. [para. 18].

Ontario Home Builders' Association et al. v. Board of Education of York Region et al., [1996] 2 S.C.R. 929; 201 N.R. 81; 93 O.A.C. 241, refd to. [para. 18].

Ottawa-Carleton (Regional Municipality) Bylaw 234-1992, Re, [1996] O.M.B.D. No. 553, refd to. [para. 20].

Cape Breton Beverages Ltd. et al. v. Nova Scotia (Attorney General) (1997), 158 N.S.R.(2d) 132; 466 A.P.R. 132; 144 D.L.R.(4th) 536 (S.C.), affd. (1997), 161 N.S.R.(2d) 71; 477 A.P.R. 71; 151 D.L.R.(4th) 575 (C.A.), leave to appeal refused [1997] 3 S.C.R. vii; 226 N.R. 318; 166 N.S.R.(2d) 240; 498 A.P.R. 240, refd to. [para. 20].

Lawson v. British Columbia (Interior Tree Fruit and Vegetable Committee of Direction), [1931] S.C.R. 357, appld. [para. 22].

Statutes Noticed:

Constitution Act, 1867, sect. 53, sect. 91, sect. 92 [Appendix].

Canada National Parks Act, S.C. 2000, c. 32, sect. 4(1), sect. 16(1), sect. 16(3) [Appendix].

Canada National Parks Act Regulations (Can.), National Parks of Canada Businesses Regulations, SOR/98-455, sect. 3, sect. 4(2) [Appendix].

Canada National Parks Act Regulations (Can.), National Parks General Regulations, SOR/78-213, sect. 39 [Appendix].

National Parks of Canada Businesses Regulations - see Canada National Parks Act Regulations (Can.).

National Parks General Regulations - Canada National Parks Act Regulations (Can.).

Parks Canada Agency Act, S.C. 1998, c. 31, sect. 20(2), sect. 23, sect. 24 [Appendix].

Authors and Works Noticed:

Canada, House of Commons Standing Committee on Environmental and Sustainable Development, Evidence, 1st Sess., 38th Parliament (May 19, 2005), p. 7 [para. 43].

Hogg, Peter W., and Monahan, Patrick J., Liability of the Crown (3rd Ed. 2000), p. 246 [para. 4].

Hogg, Peter W., Constitutional Law of Canada (5th Ed.) (2007 Looseleaf Update), vol. 1, pp. 433 to 436 [para. 16]; 870 to 871 [para. 49].

Counsel:

Jack N. Agrios, Q.C., and Janice A. Agrios, Q.C., for the appellants;

Kirk N. Lambrecht, Q.C., and Cheryl D. Mitchell, for the respondents;

Janet E. Minor and Michael S. Dunn, for the intervenor.

Solicitors of Record:

Jack N. Agrios, Edmonton, Alberta, for the appellants;

Attorney General of Canada, Edmonton, Alberta, for the respondents;

Attorney General of Ontario, Toronto, Ontario, for the intervenor.

This appeal was heard on November 16, 2007, before McLachlin, C.J.C., Bastarache, Binnie, LeBel, Deschamps, Fish, Abella, Charron  and   Rothstein,  JJ.,  of  the  Supreme Court of Canada. The following judgment of the Supreme Court was delivered by Rothstein, J., in both official languages on February 29, 2008.