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CONSTITUTIONAL VALIDITY OF LEGISLATION - Level of government - Federal legislation

Friday, June 07, 2019 @ 8:39 AM  


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Reference for an advisory opinion on the question of whether the Greenhouse Gas Pollution Pricing Act was unconstitutional in whole or in part. The Act sought to ensure there was a minimum national price on greenhouse gas (GHG) emissions in order to encourage their mitigation. Part 1 of the Act imposed a charge on GHG-producing fuels and combustible waste. Part 2 put in place an output-based performance system for large industrial facilities. Such facilities were obliged to pay compensation if their GHG emissions exceeded applicable limits. Significantly, the Act operated as no more than a backstop. It applied only in those provinces or areas where the Governor in Council concluded GHG emissions were not priced at an appropriate level. The Attorney General of Saskatchewan (Saskatchewan) challenged the Act by submitting that it imposed taxes in the constitutional sense of the term. That would normally be legally unobjectionable because Parliament enjoyed a broad taxing authority. However, Saskatchewan contended the Act was invalid because the Governor in Council determined the provinces where it operated. That was said to offend the principle of federalism in that the application of the Act depended on whether a province exercised its own jurisdiction in relation to pricing GHG emissions to a standard considered appropriate by the Governor in Council. Saskatchewan also said that the Act ran afoul of s. 53 of the Constitution Act, 1867, which required that taxes be authorized by legislative bodies themselves and not by executive government or otherwise. Saskatchewan submitted, by way of an alternative line of argument, that the Act was unconstitutional because it was concerned with property and civil rights and other matters of a purely local nature falling within exclusive provincial legislative authority. The Attorney General of Canada (Canada) responded by seeking to uphold the Act as a valid exercise of Parliament's jurisdiction under the national concern branch of its Peace, Order, and good Government (POGG) power. Canada contended it should be recognized, under the national concern branch, as having jurisdiction over the cumulative dimensions of GHG emissions.

HELD: The Greenhouse Gas Pollution Pricing Act was not unconstitutional either in whole or in part. The principle of federalism was not a free-standing concept that could override an otherwise validly enacted law. Rather, it was a value to be considered when interpreting the Constitution. Saskatchewan's s. 53 argument could not be sustained either because, in constitutional terms, the levies imposed by the Act were regulatory charges, not taxes. In any event, even if they were taxes, the Act did not offend s. 53. Parliament clearly and expressly authorized the Governor in Council to decide where the Act would apply. Canada's approach was rejected because it would allow Parliament to intrude so deeply into areas of provincial authority that the balance of federalism would be upset. Further, it would hamper and limit provincial efforts to deal with GHG emissions. However, Parliament did have authority over a narrower POGG subject matter, the establishment of minimum national standards of price stringency for GHG emissions. That jurisdiction had the singleness, distinctiveness and indivisibility required by the law. It also had a limited impact on the balance of federalism and left provinces broad scope to legislate in the GHG area. The Act was constitutionally valid because its essential character fell within the scope of that POGG authority.

Greenhouse Gas Pollution Pricing Act (Re), [2019] S.J. No. 156, Saskatchewan Court of Appeal, R.G. Richards C.J.S., G.R. Jackson, R.K. Ottenbreit, N.W. Caldwell and L.M. Schwann JJ.A., May 3, 2019. Digest No. TLD-June32019014