Saputo Inc. et al. v. Canada (Attorney General), (2011) 414 N.R. 45 (FCA)

JudgeLétourneau, Nadon and Mainville, JJ.A.
CourtFederal Court of Appeal (Canada)
Case DateFebruary 09, 2011
JurisdictionCanada (Federal)
Citations(2011), 414 N.R. 45 (FCA);2011 FCA 69

Saputo Inc. v. Can. (A.G.) (2011), 414 N.R. 45 (FCA)

MLB headnote and full text

[French language version follows English language version]

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

Temp. Cite: [2011] N.R. TBEd. MR.031

Saputo Inc. and Kraft Canada Inc. (appellants) v. The Attorney General of Canada (respondent) and St-Albert Cheese Cooperative Inc. and International Cheese Company Ltd. (intervenors)

(A-456-09; 2011 FCA 69; 2011 CAF 69)

Indexed As: Saputo Inc. et al. v. Canada (Attorney General)

Federal Court of Appeal

Létourneau, Nadon and Mainville, JJ.A.

February 28, 2011.

Summary:

Amendments to the Food and Drug Regulations and the Dairy Products Regulations harmonized the respective definitions for milk products and revised the existing identity and compositional standards for cheese destined for inter-provincial or international trade, including cheese imported into Canada. By way of judicial review, the applicants, large dairy processors operating federally registered facilities, challenged the legality of the amendments.

The Federal Court, in a decision reported at (2009), 353 F.T.R. 67, dismissed the application for judicial review. The applicants appealed.

The Federal Court of Appeal dismissed the appeal.

Administrative Law - Topic 7525

Delegated powers - Validity of delegated powers - Rules or regulations - Ultra vires - Amendments to the Food and Drug Regulations and the Dairy Products Regulations harmonized the respective definitions for milk products and revised the existing identity and compositional standards for cheese destined for inter-provincial or international trade, including cheese imported in Canada - The applicants, large dairy processors operating federally registered facilities, challenged the legality of the amendments - Martineau, J., held that the amendments were a proper exercise of the regulation-making authority vested to the Governor in Council under the Food and Drugs Act (FDA) and the Canada Agricultural Products Act (CAPA), which was to (i) prescribe standards of composition, strength, potency, purity, quality or other property of any article of food (FDA, s. 30) and (ii) regulate the marketing of agricultural products in import, export and inter-provincial trade and to provide for national standards and grades of agricultural products (CAPA, s. 32) - The Federal Court of Appeal dismissed the applicants' appeal - The regulations sought in pith and substance to set compositional standards for cheese products marketed in import, export and interprovincial trade - They were validly adopted under clear regulation-making authority - See paragraphs 67 to 73.

Administrative Law - Topic 7525

Delegated powers - Validity of delegated powers - Rules or regulations - Ultra vires - [See both Constitutional Law - Topic 5672 ].

Administrative Law - Topic 7565

Delegated powers - Subdelegation of powers - Prohibition against delegation by delegate (delegatus non potest delegare) - Amendments to the Food and Drug Regulations and the Dairy Products Regulations harmonized the respective definitions for milk products and revised the existing identity and compositional standards for cheese destined for inter-provincial or international trade, including cheese imported in Canada - By way of judicial review, the applicants, large dairy processors operating federally registered facilities, challenged the legality of the amendments - In the context of their assertion that the amendments constituted an improper exercise of the regulation-making authority vested to the Governor in Council under the Food and Drugs Act and the Canada Agricultural Products Act, the applicants submitted, inter alia, that the impugned provisions were meaningless and failed to establish objective and uniform standards - Accordingly, they vested an ad hoc rule making ability in the Canadian Food Inspection Agency which was an impermissible subdelegation of the regulation-making authority - Martineau, J., rejected this argument - The Federal Court of Appeal dismissed the applicants' appeal - The standards set out under the regulations were clear and unambiguous - There was no foundation in fact or law to the applicants' assertions regarding impermissible subdelegation - See paragraph 74.

Constitutional Law - Topic 5672

Federal jurisdiction (s. 91) - Regulation of trade and commerce - Interprovincial trade - Federal legislation - Amendments to the Food and Drug Regulations and the Dairy Products Regulations harmonized the respective definitions for milk products and revised the existing identity and compositional standards for cheese destined for inter-provincial or international trade, including cheese imported in Canada - The applicants, large dairy processors operating federally registered facilities, challenged the legality of the amendments - Martineau, J., held that the amendments were a valid exercise of the federal trade and commerce power under s. 91(2) of the Constitution Act, 1867 - The Federal Court of Appeal dismissed the applicants' appeal - Martineau, J., made no reviewable error in finding that the pith and substance of the new regulations was to establish compositional standards for cheese that was marketed inter-provincially or internationally - They were intended to (a) harmonize existing federal regulations concerning the use of new technologies in protein products; (b) enhance consumer interests by protecting the traditional properties of cheese; (c) allow for technological advances; and (d) provide consistency with certain international food standards - See paragraphs 12 to 48.

Constitutional Law - Topic 5672

Federal jurisdiction (s. 91) - Regulation of trade and commerce - Interprovincial trade - Federal legislation - Amendments to the Food and Drug Regulations and the Dairy Products Regulations harmonized the respective definitions for milk products and revised the existing identity and compositional standards for cheese destined for inter-provincial or international trade, including cheese imported in Canada - The applicants, large dairy processors operating federally registered facilities, challenged the legality of the amendments - Martineau, J., held that the amendments were a valid exercise of the federal trade and commerce power under s. 91(2) of the Constitution Act, 1867 - The Federal Court of Appeal dismissed the applicants' appeal - Having found that the pith and substance of the new regulations was to establish compositional standards for cheese that was marketed inter-provincially or internationally, the court agreed with Martineau, J., that the regulations fell within the federal power to regulate trade and commerce - The effects of the regulations were strictly limited to cheese products marketed for export, import or interprovincial trade - The fact that the regulations might incidentally affect production did not mean that they were directed to production, rather than trade and commerce - To decide otherwise would result in the absurd proposition that no federal compositional standards could be adopted for food products marketed for import, export or interprovincial trade since almost all such standards incidentally affected the production of food products - Consequently, federal legislative authority to establish standards for food products marketed in export, import or interprovincial trade and which had an incidental effect on local production did not, on that account alone, become invalid - See paragraphs 49 to 66.

Constitutional Law - Topic 5676

Federal jurisdiction (s. 91) - Regulation of trade and commerce - Food and drug legislation - [See both Constitutional Law - Topic 5672 ].

Statutes - Topic 5312

Operation and effect - Delegated legislation - General and definitions - Subdelegation - General - [See Administrative Law - Topic 7565 ].

Statutes - Topic 5363

Operation and effect - Delegated legislation - Regulations - Validity of - Scope of authority to make - [See first Administrative Law - Topic 7525 ].

Cases Noticed:

Eli Lilly Canada Inc. v. Novopharm Ltd. et al. (2009), 393 N.R. 38; 2009 FCA 138, refd to. [para. 8].

Canadian Council for Refugees et al. v. Canada, [2009] 3 F.C.R. 136; 385 N.R. 1; 74 Admin. L.R.(4th) 79; 2008 FCA 229, leave to appeal refused (2009), 395 N.R. 387 (S.C.C.), refd to. [para. 8].

Moktari v. Canada (Minister of Citizenship and Immigration), [2000] 2 F.C. 341; 249 N.R. 385 (F.C.A.), refd to. [para. 8].

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; 291 D.L.R.(4th) 577; 64 C.C.E.L.(3d) 1; 2008 SCC 9, refd to. [para. 9].

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1; 211 D.L.R.(4th) 577; 2002 SCC 33, refd to. [para. 9].

United Taxi Drivers' Fellowship of Southern Alberta et al. v. Calgary (City), [2004] 1 S.C.R. 485; 318 N.R. 170; 346 A.R. 4; 320 W.A.C. 4; 2004 SCC 19, refd to. [para. 10].

Sunshine Village Corp. v. Parks Canada et al., [2004] 3 F.C.R. 600; 320 N.R. 331; 2004 FCA 166, refd to. [para. 10].

Mercier v. Correctional Service of Canada et al. (2010), 404 N.R. 275; 2010 FCA 167, refd to. [para. 10].

Consolidated Fastfrate Inc. v. Western Canada Council of Teamsters et al., [2009] 3 S.C.R. 407; 395 N.R. 276; 469 A.R. 50; 470 W.A.C. 50; 2009 SCC 53, refd to. [para. 11].

CHC Global Operations (2008) Inc. v. Global Helicopter Pilots Association (2010), 401 N.R. 37; 2010 FCA 89, refd to. [para. 11].

Ward v. Canada (Attorney General) et al., [2002] 1 S.C.R. 569; 283 N.R. 201; 211 Nfld. & P.E.I.R. 125; 633 A.P.R. 125; 2002 SCC 17, refd to. [para. 12].

Canadian Western Bank et al. v. Alberta, [2007] 2 S.C.R. 3; 362 N.R. 111; 409 A.R. 207; 402 W.A.C. 207; 2007 SCC 22, refd to. [para. 12].

Ontario (Attorney General) v. Chatterjee, [2009] 1 S.C.R. 624; 387 N.R. 206; 249 O.A.C. 355; 2009 SCC 19, refd to. [para. 12].

Reference Re Assisted Human Reproduction Act (2010), 410 N.R. 199; 2010 SCC 66, refd to. [para. 14].

Anti-Inflation Act, Re, [1976] 2 S.C.R. 373; 9 N.R. 541, refd to. [para. 22].

Reference Re Validity of Section 6 of the Farm Security Act, 1944 (Sask.), [1949] A.C. 110 (P.C.), refd to. [para. 22].

Saskatchewan (Attorney General) v. Canada (Attorney General) - see Reference Re Validity of Section 6 of the Farm Security Act, 1944 (Sask.).

R. v. Morgentaler, [1993] 3 S.C.R. 463; 157 N.R. 97; 125 N.S.R.(2d) 81; 349 A.P.R. 81, refd to. [para. 22].

Alberta (Attorney General) v. Canada (Attorney General), [1939] A.C. 117 (P.C.), refd to. [para. 23].

R. v. Big M Drug Mart Ltd., [1985] 1 S.C.R. 295; 58 N.R. 81; 60 A.R. 161, refd to. [para. 23].

RJR-MacDonald Inc. et Imperial Tobacco Ltd. v. Canada (Procureur général), [1995] 3 S.C.R. 199; 187 N.R. 1, refd to. [para. 23].

Black & Co. v. Law Society of Alberta, [1989] 1 S.C.R. 591; 93 N.R. 266; 96 A.R. 352, refd to. [para. 51].

Manitoba (Attorney General) v. Manitoba Egg & Poultry Association (Manitoba Egg Reference), [1971] S.C.R. 689, refd to. [para. 54].

Manitoba Egg Reference - see Manitoba (Attorney General) v. Manitoba Egg & Poultry Association.

R. v. Dominion Stores Ltd. and Ontario (Attorney General), [1980] 1 S.C.R. 844; 30 N.R. 399, refd to. [para. 54].

R. v. Eastern Terminal Elevator Co., [1925] S.C.R. 434, refd to. [para. 54].

Citizens Insurance Co. of Canada v. Parsons (1881), 7 App. Cas. 96 (P.C.), consd. [para. 55].

Carnation Co. v. Agricultural Marketing Board (Que.), [1968] S.C.R. 238, refd to. [para. 55].

Caloil Inc. v. Canada (Attorney General), [1971] S.C.R. 543, refd to. [para. 55].

Labatt Breweries of Canada Ltd. v. Canada (Attorney General) and Quebec (Attorney General), [1980] 1 S.C.R. 914; 30 N.R. 496, refd to. [para. 55].

Agricultural Products Marketing Act, R.S.C. 1970, Farm Products Marketing Agencies Act, S.C. 1972, Farm Products Marketing Act, R.S.O. 1970, Re, [1978] 2 S.C.R. 1198; 19 N.R. 361, refd to. [para. 57].

Fédération des producteurs volailles du Québec et al. v. Pelland, [2005] 1 S.C.R. 292; 332 N.R. 201; 2005 SCC 20, refd to. [para. 59].

Standard Sausage Co. v. Lee, [1934] 1 W.W.R. 81 (B.C.C.A.), refd to. [para. 71].

R. v. Wetmore et al., [1983] 2 S.C.R. 284; 49 N.R. 286, refd to. [para. 71].

Jamieson (C.E.) & Co. (Dominion) Ltd. et al. v. Canada (Attorney General) (1987), 12 F.T.R. 167; 46 D.L.R.(4th) 582 (T.D.), refd to. [para. 71].

Canadian Generic Pharmaceutical Association v. Canada (Minister of Health) et al. (2010), 413 N.R. 89; 2010 FCA 334, refd to. [para. 71].

Apotex v. Canada (Minister of Health) - see Canadian Generic Pharmaceutical Association v. Canada (Minister of Health) et al.

Statutes Noticed:

Canada Agricultural Products Act Regulations (Can.), Dairy Products Regulations, SOR/2007-302, sect. 6(3)(c), sect. 6(3)(d)(i), sect. 6(5), sect. 28(1)(a)(i.1), sect. 28(1)(a)(i.2), sect. 28(4) [para. 1].

Dairy Products Regulations - see Canada Agricultural Products Act Regulations (Can.).

Food and Drugs Act Regulations (Can.), Food and Drug Regulations, C.R.C. 1978, c. 870, sect. B.08.033(1)(a)(i.1), sect. B.08.033(1)(a)(i.2), sect. B.08.033(1.2), sect. B.08.034(1)(a)(i)(i.1), sect. B.08.034(1)(a)(i)(i.2), sect. B.08.034(1)(c)(i), sect. B.08.034(1.2) [para. 1].

Food and Drug Regulations - see Food and Drugs Act Regulations (Can.).

Authors and Works Noticed:

Monahan, Patrick J., Constitutional Law (2d Ed. 2002), p. 283 [para. 65].

O'Rourke, Raymond, European Food Law (3d Ed. 2005), p. 14-019 [para. 44].

Counsel:

Patrick Gerard, for the appellant, Saputo Inc.;

Timothy M. Lowman and Patrick J. Cotter, for the appellant, Kraft Canada Inc.;

Alexandre Gay and Brian Harvey, for the respondent;

David K. Wilson and Adam Huff, for the intervenors.

Solicitors of Record:

Stikeman Elliott LLP, Montreal, Quebec, for the appellant, Saputo Inc.;

Sim Lowman Ashton & McKay LLP, Toronto, Ontario, for the appellant, Kraft Canada Inc.;

Myles J. Kirvan, Deputy Attorney General of Canada, Ottawa, Ontario, for the respondent;

Fasken Martineau LLP, Ottawa, Ontario, for the intervenors.

This appeal was heard at Ottawa, Ontario, on February 9, 2011, by Létourneau, Nadon and Mainville, JJ.A., of the Federal Court of Appeal. On February 28, 2011, Mainville, J.A., delivered the following reasons for judgment for the court.

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