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AIR TRANSPORTATION - Regulation - Federal - Complaints about air carriers - Canadian Transportation Agency

Friday, January 19, 2018 @ 2:17 PM  


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Appeal by Delta Air Lines Inc. (Delta) from a judgment of the Federal Court of Appeal setting aside a decision of the Canadian Transportation Agency (Agency) dismissing Lukács’s complaint for discriminatory practices. Lukács filed a complaint with the Agency, alleging that Delta applied discriminatory practices governing the carriage of obese persons. The Agency dismissed his complaint on the basis that Lukács, who was not himself obese, had failed to meet the tests for private interest standing and public interest standing as developed by and for courts of civil jurisdiction. It held that to establish private interest standing, Lukács should have shown that he had been aggrieved, affected, or had some other sufficient interest. Applying the test for public interest standing, the Agency concluded that standing was to be denied to Lukács because the complaint was “not related to the constitutionality of legislation or to the non-constitutionality of administrative action”. The Federal Court of Appeal allowed Lukács’ appeal. It held that a strict application of the law of standing as applied in courts was inconsistent with the Agency’s enabling legislation. Moreover, it concluded that it was contrary to the Agency’s objective to refuse to examine a complaint based solely on whether a complainant had been directly affected or had public interest standing. The Federal Court of Appeal held that in refusing to examine Lukács’ complaint, the Agency unreasonably fettered its discretion. Ultimately, the Federal Court of Appeal directed that the matter be returned to the Agency to determine, otherwise than on the basis of standing, whether it would inquire into, hear and decide Lukács’ complaint.

HELD: Appeal allowed in part. The standard of review to be applied in this case was reasonableness. The Agency was charged with implementing the Canada Transportation Act (Act) and the Air Transportation Regulations (Regulations). This legislative scheme required the Agency to balance a range of interests in order to ensure a competitive, safe, and accessible transportation network for all Canadians. Sections 111 and 113 of the Regulations allowed the Agency to act to correct discriminatory terms and conditions before passengers actually experienced harm. In the present case, the Agency applied a test for public interest standing that could arguably never be satisfied. A complaint regarding the terms and conditions established by a private company such as an air carrier could never, by its very nature, be a challenge to the constitutionality of legislation or the illegality of administrative action. The imposition of a test that could never be met could not be what Parliament intended when it conferred a broad discretion on the Agency to decide whether to hear complaints. The Agency’s application of the test was also inconsistent with the rationale underlying public interest standing. The Agency did not maintain a flexible approach to this question and in so doing unreasonably fettered its discretion. While the public interest standing test was designed to protect courts’ discretion, the Agency eliminated any of its own discretion under this test. The second problem with the decision was that the impact of the tests for private and public interest standing, applied as they were in this decision, could not be supported by a reasonable interpretation of how the legislative scheme was intended to operate. Applying these tests in the way the Agency did would preclude any public interest group or representative group from ever having standing before the Agency, regardless of the content of its complaint. This was contrary to the scheme of the Act. The Agency’s decision failed to meet the indicia of reasonableness. The Court of Appeal should not have held that standing rules could not be considered by the Agency in its reconsideration of the matter. The better approach was to send this matter back to the Agency for reconsideration in its entirety.

Delta Air Lines Inc. v. Lukács, [2018] S.C.J. No. 2, Supreme Court of Canada, B. McLachlin C.J. and R.S. Abella, M.J. Moldaver, A. Karakatsanis, R. Wagner, C. Gascon, S. Côté, R. Brown and M. Rowe JJ. Digest No. TLD-January152018011SCC