The Courts and Canadian Federalism: From Watertight Compartments to Shared Responsibility

• Author: Patrick J. Monahan, Byron Shaw
• Pages: 241-261

241

CHA PTER 7

THE COURTS AND

CANA DI A N FEDER ALISM:

FROM WATERTIGHT

COMPARTMENTS TO

SHARED RESPONSIBILIT Y

A. INT RODUCTION

Sir John A. Macdonald believed that the Constitution Act, 1867,1 had

been drafted in such a m anner as to ensure that “‘all conf‌lict of juris-

diction’ had been avoided” and that the courts would therefore assume

a relatively minor role in the evolution of Canadian federali sm.2 His

prediction proved to be wildly inaccurate. First, the language used in

the BNA Act, although apparently clear to its dra fters, turned out to be

ambiguous and open-ended in practice. Second, and more signi f‌icantly,

the division of legislative responsibility ref‌lected an era in which gov-

ernment played a modest and limited role. Within a matter of decades,

the entire conception of the role of the state in Canada h ad changed,

with governments being c alled on to intervene in areas of economic

regulation and social policy that were simply unknown in 1867. The

drafters of the BNA Act naturally did not address how these new roles

and responsibilities would be shared between different levels of gov-

ernment.

It largely fell to the courts to structure a division of powers for Can-

ada. While the courts rendered t heir decisions in accordance with t he

1 The Constitution Act, 1867 (formerly, the British North Ameri ca Act, 1867 (U.K.),

30 & 31 Vict., c. 3).

2 Quoted in W.P.M. Kennedy, “The Interpretation of the British North A merica Act”

(1943) 8 Cambridge L.J. 146 at 151.

CONSTITUTIONA L LAW

242

categories of legislative powers set out in sections 91 and 92 of the BNA

Act, these categories merely provided a framework for decision-making.

Before 1949, the highest court in Canada was the Judicial Commit-

tee of the Privy Council (the

JCPC

or the Board). As Mallory has pointed

out, in some respects, the

JCPC

was an ideal court of constitutiona l

appeal.3 Made up of Briti sh judges who were members of the House

of Lords, the

JCPC

was clearly impart ial and disinterested as between

the federal and provincial govern ments in Canada. The Board was a lso

well positioned to defend the liberty of indiv iduals and the rule of law;

law lords sitting in di stant Whitehall were far removed from short-term

political pressures in Canada. Despite thes e potential advantages, the

Privy Council’s record in the interpretation of the Canadian constitu-

tion is, at best, mixed and highly controversial. The clear intention of

the BNA Act was to create a centralized federation. However, the

JCPC

interpreted the Act so as to allocate many of the most important areas

of legislative jurisdiction to the provinces. Furthermore, the scheme of

federalism created by the

JCPC

turned out to be unworkable in many

respects. The twentieth centur y witnessed a dramatic ex pansion in the

role of government, with the state assum ing responsibilities in social

and economic policy that were unheard of in 1867. Yet most of these

new responsibilities were regarded by the Privy Council as m atters for

the exclusive jurisdiction of the provinces, which lacked the necessar y

f‌inancial resources to deal effectively with these new challenges. One

of the largest challenges facing both levels of government in Canada

since 1945 has been to devise mechanisms that will permit them to

escape or to bypass the impractical constitutional framework created

by the

JCPC

.

This chapter begins w ith an overview of the man ner in which the

JCPC

interpreted the division of legislative powers in sections 91 and 92

of the BNA Act until 1949. We also explain how this body of jurispru-

dence contributed to a f‌iscal and constitutional crisis that emerged in

the 1930s, which forced governments at both the federal and the prov-

incial level to begin to search for new solutions. Finally, we trace the

manner in which governments si nce 1949 have developed cooperative,

intergovernmental mechani sms for coordinating shared jur isdiction.

3 See the disc ussion of the role of the

JCPC

in J.R. Mallory, The Stru cture of Can-

adian Government, 2d ed. (Toronto: Gage, 1984) at 377–81.