EXCLUSIVELY YOURS: RECONSIDERING INTERJURISDICTIONAL IMMUNITY.

• Author: Wilkins, Kerry

1. INTRODUCTION

   A little over ten years ago, in Canadian Western Bank, (1) the Supreme Court of Canada, alarmed by what it called "the dangers of allowing the doctrine of interjurisdictional immunity to exceed its proper (and very restricted) limit", (2) set about reducing access to it substantially.

   Before then, it was understood "that each head of federal legislative power under the Constitution Act, 1867, possesses basic, minimum, and unassailable content, which the provinces are not permitted to regulate indirectly through valid laws of general application" and that " [t]his exclusive federal jurisdiction precludes the application... of provincial statutes which have the effect of regulating" anything comprising that "core" of federal legislative authority. (3) But according to the majority of the Court in Canadian Western Bank, interjurisdictional immunity (IJI), though "in principle applicable to all federal and provincial heads of legislative authority,"' "is of limited application and should in general be reserved for situations already covered by precedent." (5) "[T]he absence of prior case law favouring its application to the subject matter at hand", the majority added, "will generally justify a court proceeding directly to the consideration of federal paramountcy", (6) postponing the IJI inquiry, if not omitting it altogether. Finally, under this new dispensation:

   [I]t is not enough for the provincial legislature simply to "affect" that which makes a federal subject or object of rights specifically of federal jurisdiction. The difference between "affects" and "impairs" is that the former does not imply any adverse consequence whereas the latter does.... It is when the adverse impact of a law adopted by one level of government increases in severity from "affecting" to "impairing" (without necessarily "sterilizing" or "paralyzing") that the "core" competence of the other level of government (or the vital or essential part of an undertaking it duly constitutes) is placed in jeopardy [under IJI], and not before. (7) Why the facts of that particular case invited this response is still a mystery. The Court could have reached its preferred result there--concluding that banks, when selling insurance, are subject, like everyone else in the province, to Alberta's insurance laws--without departing at all from previous understandings of IJI and its scope. Bastarache J, in concurring reasons, did exactly that. (8) But for whatever reason, the Court chose that occasion to curtail future use of IJI. (9) Subsequent decisions have embraced the new paradigm, (10) reiterating the Court's reservations about the doctrine (11) and reminding the reader, even on the two occasions since Canadian Western Bank on which the Court has invoked it, (12) that IJI can be dangerous unless used precisely as directed. For mature audiences only; parental guidance strongly recommended.

   What is all the fuss about? And what happened in 2007 to make IJI seem so much more threatening than it had generally seemed before? (13) I don't know the answer to the second question; it's interesting, though, that despite having disapproved and narrowed previous IJI doctrine, the Court continues to say that IJI remains available in situations already covered by precedents drawn from that earlier doctrine. (14) As to the first, in Canadian Western Bank and its progeny, the Court has offered six reasons why we need to handle IJI with particular care. IJI is said to: (1) be superfluous, because the paramountcy doctrine gives Parliament all the power it needs to neutralize intrusive provincial legislation; (15) (2) risk creating "legal vacuums"; (16) (3) be in tension with the principle of cooperative federalism, whereby both orders of government work rogether to address problems of common interest; (17) (4) risk giving effect to an "unintentional centralizing tendency in constitutional interpretation"; (18) (5) be out of step with the "dominant tide" in modern division of powers jurisprudence, which prefers to tolerate, where possible, the concurrent operation of legislation from both orders of government; (19) and (6) assume the existence of abstract "cores" of exclusive legislative authority whose postulation "is not compatible, generally speaking, with the tradition of Canadian constitutional interpretation". (20) In brief, this jurisprudence suggests, IJI is inconvenient, incorrect (politically and methodologically), and unnecessary. If we're not quite ready to discard IJI altogether, we ought (the argument runs) to keep it safely and securely bottled, reserving ir for exceptional use and even then, only where the situation is serious.

   Personally, I don't find any of this especially convincing. In my judgment, the reasons the Court has offered for restricting resort to IJI are unpersuasive and the restrictions imposed, therefore, artificial. I propose in this article to say why, but more importantly, to revisit the very idea of IJI as a feature of the Canadian constitutional order. If we are to make fully informed decisions about IJI, we need to understand better than it seems we currently do how it works and what it contributes to Canadian federalism.

   It is true that IJI can seem esoteric, even counterintuitive. It is fair for one to wonder what useful purpose it still serves. To answer that question, we need to begin by reacquainting ourselves with the reasons we have been taught to care about Canadian federalism and to satisfy ourselves whether they still matter. I argue in Part Two that they do. A functioning federal system requires a means of ensuring that each of its component orders of government minds its own business. Then we need to turn our attention to IJI itself: to what distinguishes it from other, related constitutional doctrines; to whether (as some have suggested) it's reciprocal, protecting exclusive provincial as well as exclusive federal authority (short answer: probably not); and to IJI's particular contribution to our constitutional scheme. These are the subjects of Part Three. My view is that IJI deserves a place within that scheme, because it is all that protects a crucial but under-recognized aspect of parliamentary sovereignty: Parliament's freedom to legislate, or not to legislate, in respect of matters within its exclusive legislative authority. Were it not for IJI, only the federal government would have any capacity to limit the impact on exclusively federal matters of otherwise valid provincial legislation.

   Part Four considers and rejects each of the six reasons the Supreme Court has offered for circumscribing dramatically the reach of IJI doctrine. Part Five engages the underlying normative inquiry and suggests an approach to IJI more resonant than the current one with the constitutional values that support the doctrine's retention. I argue, in brief, that IJI should protect all but only those matters within federal legislative authority deemed to have sufficient national importance to need protection from collateral as well as deliberate provincial supervision. A matter will have sufficient national importance to attract

   IJI when the national interest, or fidelity to the purpose underlying the grant of specific federal authority, requires a measure of consistency or coordination of approach in respect of it nationwide. This will be so when it would compromise the national interest, or realization of that purpose, to leave the matter vulnerable to legislation reflecting the interplay of (otherwise perfectly legitimate) local or regional preferences or concerns. The kinds of provincial measures against which IJI should immunize are those whose unintended effects on such matters would, if intended, have sufficed to render those measures invalid. Part VI contains some concluding remarks about IJI.

2. FEDERALISM 101

   In the Quebec Secession Reference, (21) the Supreme Court put federalism first on its list of the "four foundational constitutional principles" that comprise "the vital unstated assumptions upon which the text [of Canada's Constitution] is based." (22) "It is undisputed", the Court insisted, "that Canada is a federal state"; (23) "there can", it added, "be little doubt that the principle of federalism remains a central organizing theme of our Constitution." (24) The Court in Canadian Western Bank agreed. (25)

   But federalism, pared to its essence, requires only that there be more than one independent source of authority within a given polity. In Canada, "political power is shared by two orders of government: the federal government, on the one hand, and the provinces, on the other." (26) Strictly speaking, that is all one need say to affirm that Canada is a federal state. Federalism does not require any particular allocation of the powers available to its constituent orders of government. Different federations allocate powers differently.

   So here is a thought experiment. What would be wrong with saying that our two orders of government, federal and provincial, could each make laws about whatever they wanted, subject only to the constraints of the Charter, (27) section 35 of the Constitution Act, 1982, (28) and sections 96 (29) and 121 (30) of the Constitution Act, 1867? As long as the Constitution protects these fundamental rights from unjustified government interference, protects a guaranteed core of superior court jurisdiction altogether, and prohibits intentional restrictions on interprovincial trade, what difference does it make which order of government legislates what?

   Well, to start with, it might matter to the constituent orders of government themselves. If the federal order in a federated arrangement were going to have any meaningful authority to govern nationwide, at least some federal enactments would need priority (paramountcy) over provincial enactments, in case of conflict. Otherwise, there would be serious risk of confusion, fragmentation, or both. But federal paramountcy, coupled with...