Newfoundland and Labrador Hydro v. Newfoundland and Labrador (Board of Public Utilities) et al., 2012 NLCA 38

• Judge: Green, C.J.N.L., Mercer and Harrington, JJ.A.
• Court: Court of Appeal (Newfoundland)
• Case Date: June 19, 2012
• Jurisdiction: Newfoundland and Labrador
• Citations: 2012 NLCA 38;(2012), 323 Nfld. & P.E.I.R. 127 (NLCA)

Nfld. Hydro v. Nfld. (2012), 323 Nfld. & P.E.I.R. 127 (NLCA);

    1004 A.P.R. 127

MLB headnote and full text

Temp. Cite: [2012] Nfld. & P.E.I.R. TBEd. JN.030

Newfoundland and Labrador Hydro (appellant) v. The Board of Commissioners of Public Utilities (first respondent), The Consumer Advocate as represented by Thomas Johnson (second respondent), Corner Brook Pulp and Paper Limited (third respondent), North Atlantic Refining Limited (fourth respondent), Teck Resources Limited (fifth respondent), Vale Newfoundland and Labrador Limited (sixth respondent), Abitibi Consolidated Company of Canada (seventh respondent) and Newfoundland Power Inc. (eighth respondent)

(10/113)

The Consumer Advocate as represented by Thomas Johnson (appellant) v. The Board of Commissioners of Public Utilities (first respondent), Newfoundland and Labrador Hydro (second respondent), Corner Brook Pulp and Paper Limited (third respondent), North Atlantic Refining Limited (fourth respondent), Teck Resources Limited (fifth respondent), Vale Newfoundland and Labrador Limited (sixth respondent), Abitibi Consolidated Company of Canada (seventh respondent) and Newfoundland Power Inc. (eighth respondent)

(10/114; 2012 NLCA 38)

Indexed As: Newfoundland and Labrador Hydro v. Newfoundland and Labrador (Board of Public Utilities) et al.

Newfoundland and Labrador Supreme Court

Court of Appeal

Green, C.J.N.L., Mercer and Harrington, JJ.A.

June 19, 2012.

Summary:

The Board of Commissioners of Public Utilities made a preliminary decision that savings generated in a rate stabilization plan could be shared only by industrial customers; that the Board had no jurisdiction under s. 75 of the Public Utilities Act to allocate any of those savings to residential customers. Newfoundland and Labrador Hydro and the Consumer Advocate appealed under s. 99 of the Act.

The Newfoundland and Labrador Court of Appeal allowed the appeals. The Board erred in declining jurisdiction.

Public Utilities - Topic 4672

Public utility commissions - Regulation - Rates - Powers respecting excess earnings (incl. deferral accounts) - Newfoundland and Labrador Hydro's industrial customers paid interim rates based on, inter alia, forecasted costs of supplying the anticipated demand - A higher load requirement meant higher electricity costs, because Hydro relied on oil (more expensive than hydro-electricity) to meet that higher demand - A steep decline in forecasted industrial demand (two power plant closures or partial closures) led to $68 Million in fuel cost savings accruing in a rate stabilization plan (RSP) - Industrial customers claimed entitlement to the entire balance in the RSP - The Board of Commissioners of Public Utilities made a preliminary decision that the savings accumulated in the RSP by one customer group (industrial) could be used for the benefit of that group - The Board had no jurisdiction under s. 75 of the Public Utilities Act to allocate any of those savings to residential customers (another customer group) - Hydro and the Consumer Advocate appealed - The Newfoundland and Labrador Court of Appeal, applying the correctness standard of review, allowed the appeals - The court stated that "the Board erred in: 1. allowing its determination of its jurisdiction to be arbitrarily limited by the manner in which the issue was brought before it; procedure cannot trump jurisdictional substance; 2. not concluding ... that, in respect of interim orders, all aspects of rates, including RSP rules, were made interim and therefore inherently subject to subsequent review and possible modification, on an application to make interim rates final; and 3. concluding that the PUB Act, properly interpreted, restricted the manner in which deferral accounts could be dealt with and in particular, restricted the classes of beneficiaries of such accounts. ... We conclude that the Board has jurisdiction to deal with and dispose of remaining amounts in the RSP in accordance with the broad powers contained in the legislation ... That is not to say, of course, that the Board should include customers other than the Industrial Customers as beneficiaries, only that the Board has the jurisdiction and authority to, and should, consider the submissions of all interested parties on this issue" - See paragraphs 108 to 157.

Public Utilities - Topic 4741

Public utility commissions or corporations - Judicial review - General (incl. standard of review) - Newfoundland and Labrador Hydro's industrial customers paid interim rates based on, inter alia, forecasted costs of supplying the anticipated demand - A higher load requirement meant higher electricity costs, because Hydro relied on oil (more expensive than hydro-electricity) to meet that higher demand - A steep decline in forecasted industrial demand (two power plant closures or partial closures) led to $68 Million in fuel cost savings accruing in a rate stabilization plan (RSP) - Industrial customers claimed entitlement to the entire balance in the RSP - The Board of Commissioners of Public Utilities made a preliminary decision that the savings accumulated in the RSP by one customer group (industrial) could be used for the benefit of that group - The Board had no jurisdiction under s. 75 of the Public Utilities Act to allocate any of those savings to residential customers (another customer group) - Hydro and the Consumer Advocate appealed - The Newfoundland and Labrador Court of Appeal held that "because this is a question of the proper interpretation of the Board's right to decline, according to law, to deal with a deferral account, in the context of interim rates, for the benefit of certain classes of customers, the Board should also be correct because the matter involves the jurisdiction of the Board" - The Board's decision, a true question of jurisdiction, involved a question of law which did not engage the Board's specialized expertise - See paragraphs 70 to 107.

Cases Noticed:

Consumer Advocate v. Newfoundland Power Inc. et al. (2006), 255 Nfld. & P.E.I.R. 234; 768 A.P.R. 234; 2006 NLCA 20, refd to. [para. 46].

Labrador City (Town) et al. v. Newfoundland and Labrador Hydro Inc. (2004), 241 Nfld. & P.E.I.R. 81; 716 A.P.R. 81 (Nfld. C.A.), refd to. [para. 46].

Reference Re Section 101 of the Public Utilities Act (Nfld.) (1998), 164 Nfld. & P.E.I.R. 60; 507 A.P.R. 60 (Nfld. C.A.), refd to. [para. 53].

Calgary (City) v. Energy and Utilities Board (Alta.) et al. (2010), 477 A.R. 1; 483 W.A.C. 1; 2010 ABCA 132, refd to. [para. 59].

Bell Canada v. Canadian Radio-Television and Telecommunications Commission, [1989] 1 S.C.R. 1722; 97 N.R. 15, refd to. [para. 60].

Bell Canada v. Bell Aliant Regional Communications - see Consumers Association of Canada et al. v. Canadian Radio-Television and Telecommunications Commission et al.

Consumers Association of Canada et al. v. Canadian Radio-Television and Telecommunications Commission et al., [2009] 2 S.C.R. 764; 392 N.R. 323; 2009 SCC 40, refd to. [para. 60].

Edmonton (City) v. Northwestern Utilities Ltd., [1961] S.C.R. 392, refd to. [para. 63].

New Brunswick (Board of Management) v. Dunsmuir, [2008] 1 S.C.R. 190; 372 N.R. 1; 329 N.B.R.(2d) 1; 844 A.P.R. 1; 2008 SCC 9, refd to. [para. 70].

Manitoba Association of Health Care Professionals v. Nor-Man Regional Health Authority Inc., [2011] 3 S.C.R. 616; 423 N.R. 95; 2011 SCC 59, refd to. [para. 78].

Barrie Public Utilities et al. v. Canadian Cable Television Association et al., [2003] 1 S.C.R. 476; 304 N.R. 1; 2003 SCC 28, refd to. [para. 81].

Pushpanathan v. Canada (Minister of Citizenship and Immigration), [1998] 1 S.C.R. 982, addendum [1998] 1 S.C.R. 1222; 226 N.R. 201, refd to. [para. 81].

Walsh v. Council for Licensed Practical Nurses (2010), 295 Nfld. & P.E.I.R. 222; 911 A.P.R. 222; 2010 NLCA 11, refd to. [para. 83].

Minister of National Revenue (Customs and Excise) v. Mattel Canada Inc., [2001] 2 S.C.R. 100; 270 N.R. 153; 2001 SCC 36, refd to. [para. 84].

Alliance Pipeline Ltd. v. Smith, [2011] 1 S.C.R. 160; 412 N.R. 66; 2011 SCC 7, refd to. [para. 85].

Celgene Corp. v. Canada (Attorney General), [2011] 1 S.C.R. 3; 410 N.R. 127; 2011 SCC 1, refd to. [para. 85].

Alberta Teachers' Association v. Information and Privacy Commissioner (Alta.) et al., [2011] 3 S.C.R. 654; 424 N.R. 70; 519 A.R. 1; 539 W.A.C. 1; 339 D.L.R.(4th) 428; 2011 SCC 61, refd to. [para. 85].

Canadian Union of Public Employees, Local 963 v. New Brunswick Liquor Corp., [1979] 2 S.C.R. 227; 26 N.R. 341; 25 N.B.R.(2d) 237; 51 A.P.R. 237, refd to. [para. 88].

Milner Power Inc. v. Energy and Utilities Board (Alta.) (2010), 482 A.R. 327; 490 W.A.C. 327; 2010 ABCA 236, refd to. [para. 96].

Statutes Noticed:

Public Utilities Act, R.S.N.L. 1990, c. P-47, sect. 75(1), sect. 75(3) [para. 39].

Authors and Works Noticed:

Bastarache, Michel, Modernizing Judicial Review (2009), 22 C.J.A.L.P. 227, p. 234 [para. 81].

Counsel:

Geoffrey Young, for Newfoundland and Labrador Hydro;

Thomas Johnson, for the Consumer Advocate;

Dan Simmons and Jackie Glynne, for Newfoundland and Labrador Board of Commissioners of Public Utilities;

Paul Coxworthy and Dean Porter, for Corner Brook Pulp and Paper Ltd., North Atlantic Refining Ltd., Teck Resources Ltd. and Vale Newfoundland and Labrador Ltd.;

Greg Moores, for Abitibi Consolidated Co. of Canada;

Ian Kelly, Q.C., and Gerard Hayes, for Newfoundland Power Inc.

These appeals were heard on December 9, 10 and 13, 2010, before Green, C.J.N.L., Mercer and Harrington, JJ.A., of the Newfoundland and Labrador Court of Appeal.

On June 19, 2012, the following judgment was delivered by the Court.