2019 QCCA 1598, 2019 QCCA 1598

Official English Translation of the Judgment of the Court Attorney General of Quebec v. IMTT-Québec inc. 2019 QCCA 1598 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF QUEBEC No.: 200-09-009369-163 (200-17-010101-087, 200-17-017062-126) DATE: September 26, 2019 CORAM: THE HONOURABLE ROBERT M. MAINVILLE, J.A. CLAUDINE ROY, J.A. STEPHEN W. HAMILTON, J.A. ATTORNEY GENERAL OF QUEBEC, in her capacity as representative of the Ministère du Développement durable, de l’Environnement et de la Lutte contre les changements climatiques APPELLANT / INCIDENTAL RESPONDENT — Plaintiff/Defendant v. IMTT-QUÉBEC INC.

RESPONDENT / INCIDENTAL APPELLANT — Defendant/Plaintiff and QUEBEC PORT AUTHORITY RESPONDENT / INCIDENTAL APPELLANT — Plaintiff and ATTORNEY GENERAL OF CANADA RESPONDENT / INCIDENTAL APPELLANT — Intervener and CENTRE QUÉBÉCOIS DU DROIT DE L’ENVIRONNEMENT NATURE QUÉBEC INTERVENERS JUDGMENT [ 1 ] The Attorney General of Quebec (“ AGQ ”) appeals a judgment of the Superior Court, District of Quebec (the Honourable Mr.

Justice Gilles Blanchet), rendered on September 8, 2016 ( 2016 QCCS 4337 ) that declared several provisions of the Environment Quality Act [1] (“ EQA ”) inoperative with respect to the activities and facilities of IMTT-Québec Inc. (“ IMTT ”) in the port of Quebec.

IMTT, the Quebec Port Authority (“ QPA ”) and the Attorney General of Canada (“ AGC ”) are incidental appellants. [ 2 ] The central question in this appeal is whether certain provisions of the EQA are inapplicable or inoperative with respect to IMTT, which leases land from the QPA in the port of Quebec to operate transshipment and storage terminals for bulk liquid products. [ 3 ] To answer this question, it is useful to first review the facts that gave rise to the dispute (Section I), the proceedings that were instituted (Section II), the judgment at first instance (Section III) and the imposing legislative corpus applicable to such operations (Section IV). [ 4 ] Relying on the federal powers over federal public property, interprovincial and international transportation, and navigation and shipping, the AGC, the QPA and IMTT argue that the constitutional doctrine of interjurisdictional immunity applies.

We conclude that the land on which the facilities in question are located is federal public property within the meaning of s. 91(1A) of the Constitution Act, 1867 and that IMTT’s activities are closely connected to the federal power over navigation and shipping, but that IMTT is not an interprovincial or international transportation undertaking. Based on jurisprudential precedent, the doctrine of interjurisdictional immunity applies to decide whether IMTT is required to obtain an authorization from the provincial authorities under the EQA . We

conclude that the authorization processes provided for in ss. 22 , 31.1 and 31.1.1 of the EQA are constitutionally inapplicable.

Consequently, IMTT is not required to seek an authorization from the provincial authorities under these provisions of the EQA in order to build its tanks and loading docks in the port of Quebec and carry on its activities there, as long as such activities are carried out on federal public property and genuinely serve for purposes connected to navigation or shipping, such as the storage, handling or transshipment of cargo for marine transportation purposes (Section V). [ 5 ] In other respects, without evidence of impairment or conflict between the federal and provincial legislation, there are no grounds for declaring the other provisions of the EQA or the regulations made thereunder inapplicable or inoperative (Section VI). [ 6 ] The Court points out that it would be preferable that debates regarding environmental-related matter should be resolved through collaboration rather than through confrontation, in keeping with the framework of cooperative federalism the Supreme Court of Canada has advocated for a number of years.

This is the best way to ensure environmental protection for the benefit of the public. I. THE CONTEXT [ 7 ] The QPA is the Canadian port authority that controls the operation of the port of Quebec for the purpose of its activities related to navigation, the transportation of passengers and goods, and the handling and storage of goods. [ 8 ] According to

Schedule B of its letters patent, the QPA manages the federal real property located in the port of Quebec, including the property comprising the north shore of the harbour of Quebec. The port infrastructure of which the QPA is in charge is located in three primary sectors within the harbour, namely the Anse-au-Foulon, Estuary/Pointe-à-Carcy and Beauport sectors. [ 9 ] The Beauport sector, which is the object of this dispute, was created through backfilling part of the bed of the St. Lawrence River, a project begun in the 1960s.

The water depth of the Beauport sector and its port infrastructure allow large-sized vessels or vessels with a large draft to dock there. Consequently, significant quantities of goods can be loaded or unloaded from a single ship. [ 10 ] Thanks to the Beauport sector’s infrastructure, shippers who choose the port of Quebec can use ships whose size provides significant economies of scale. This infrastructure gives the port of Quebec as well as its customers and shippers an economic advantage over other North American ports.

In addition to affording deep-water access for ships, the Beauport sector’s geographic location provides direct access to railway and highway networks leading to several major urban centres in Canada and the United States. [ 11 ] The QPA has adopted a land-use plan consistent with the Canada Marine Act , including for the Beauport sector where IMTT carries on its operations. [2] The plan specifies that the Beauport sector [ translation ] “is perfectly tailored to modern bulk marine transportation trends.

It is therefore the most promising sector for the future of the port of Quebec”. [3] The plan adds that the [ translation ] “Beauport sector provides a docking area for large-sized ships and is in keeping with the trends of modern ports in this market segment.

It is essential that the Quebec Port Authority maintain the integrity of its current properties that are able to fulfil this important mandate”. [4] A large 400- to 500-metre swath from the berths is reserved to [ translation ] “meet modern requirements for the handling of bulk products or containers with ships of over 150,000 deadweight tonnage”. [5] [ 12 ] IMTT is a corporation incorporated on March 18, 1988 under the

Canada Business Corporations Act . [6] It is a Canadian subsidiary of a U.S. firm that handles and stores bulk liquid products. It leases several riverside properties from the QPA in the harbour of Quebec’s Beauport sector. On this site, IMTT operates five terminals for the transshipment and storage of bulk liquids, as well as some fifty tanks ranging in capacity from 100 m 3 to 34,500 m 3 , for a total storage capacity of 312,000 m 3 . [ 13 ] IMTT’s customers who rent these tanks are themselves responsible for handling the transshipment of the liquid goods that enter or leave the tanks.

These goods include petroleum, heating oil, jet fuel, oils and lubricants, ethanol, methanol, biodiesel, specialty chemicals such as sodium hydroxide, and vegetable oil or animal oil-based products. [ 14 ] The goods enter the tanks when they are delivered by ship. They leave the tanks in order to be transported once again to their final destination by railway tank car, tank truck or ship. The site is connected directly to the railway network and to two major highways.

IMTT has loading ramps for this very purpose. [ 15 ] IMTT employees monitor these operations and are assigned to the terminals’ physical facilities in order to help customers with the transshipment of their products to or from the tanks.

Transshipment to and from railway tank cars and tank trucks is handled through modern loading ramps, while transshipment to and from ships is handled from two deepwater docks with an underground and aboveground system of pumps and pipelines. [ 16 ] Since several products must be stored at specific temperatures and often also require additives, IMTT is equipped with an infrastructure offering tank heating or cooling services, as well as product blending or dilution.

IMTT can also offer its customers transshipment of products between tanks and filtering of stored products. [ 17 ] Before the events that gave rise to the dispute, IMTT’s facilities and operations had been authorized in certificates issued under the EQA , including a certificate of authorization pursuant to s. 22 of the EQA issued to IMTT on June 22, 2004 for the operation of a marine terminal and 41 tanks in the port of Quebec.

This provincial certificate of authorization also covers three wastewater pretreatment systems. [ 18 ] The provincial certificate sets out protocols that IMTT must follow, including providing to the provincial ministry, on January 1 and July 1 of each year, a list of the products stored on site, monitoring the groundwater twice a year and providing the provincial ministry with access to the record of wastewater analysis results and wastewater volumes discharged into the municipal storm sewer network or the port of Quebec’s network and the origin of such wastewater.

[ 19 ] During 2006, IMTT considered various new tank construction projects to increase its total capacity for receiving, storing and delivering liquid products. As a result, seven tanks were built and commissioned:

(1) Tanks 42 and 43, having a capacity of 16,504 m 3 and 18,478 m 3 , to fulfil an agreement entered into on September 21, 2006 with a petroleum products merchant for the receipt of naphtha, gas-oil and jet fuel. Following discussions with the QPA, construction of these tanks began in December 2006, but was subject to an environmental review prior to commissioning. The QPA’s Environmental Assessment Committee authorized the project on February 26, 2007. Tank 43 was commissioned at the end July 2007, while tank 42 was commissioned at the end of October 2007.

(2) Tanks 44, 45 and 46, having a capacity of 4,892 m 3 , 4,889 m 3 and 18,242 m 3 , to fulfil an agreement entered into on December 13, 2006 with a merchant for the receipt of methanol and an earlier agreement entered into with another customer for the receipt of petroleum. The QPA’s Environmental Assessment Committee authorized the project on February 26, 2007. Construction of tank 46 began in August 2007, while construction of tanks 44 and 45 began at the start of December 2007. The three tanks were commissioned in December 2007.

(3) Tanks 53 and 54, having a capacity of 19,627 m 3 and of 19,632 m 3 , to fulfil an agreement entered into on May 17, 2007 with a customer for the receipt of jet fuel. The QPA’s Environmental Assessment Committee authorized the project on August 31, 2007.

The tanks were commissioned in mid-June 2008. [ 20 ] The parties acknowledge that for each of these new tanks, IMTT complied with the assessment and authorization processes set out in the Canadian Environmental Assessment Act [7] and the Canada Port Authority Environmental Assessment Regulations . [8] It is also acknowledged that construction of these tanks was approved by the QPA’s Environmental Assessment Committee and that these works comply with IMTT’s leases and the QPA’s land-use plan. [ 21 ] IMTT did not apply for an authorization under the EQA prior to the construction of these tanks.

On the contrary, in a letter dated April 27, 2007, IMTT asked the provincial environmental authorities to revoke the certificate of authorization that had been issued on June 22, 2004 under the EQA for the operation of its marine terminal in the port of Quebec. IMTT argued that the permit was of no use since it was a federal undertaking carrying on its activities on federal public land located in a federal port. The request for a revocation was refused. [ 22 ] On January 29, 2008, the provincial authorities received a complaint about the new tanks IMTT had started to build.

At the end of April 2008, after two inspections, they issued a notice of violation on the ground that IMTT had built the seven tanks without following the environmental impact assessment and review procedure set out in the EQA and without having obtained a certificate of authorization from the provincial government. [ 23 ] In July 2008, when the seven new tanks were already operational, the AGQ filed an application for an injunction seeking to compel IMTT to submit to the environmental impact assessment and review process under the EQA and stop using the tanks until a provincial authorization was issued in accordance with the EQA . [ 24 ] In the fall of 2008, during negotiations regarding the presentation of the application for an injunction at the interlocutory stage, IMTT and the provincial authorities entered into a memorandum of understanding in which IMTT agreed to submit the seven tanks to the environmental impact assessment and review process under the EQA in order to try to settle the injunction file, without, however, acknowledging the application of the EQA .

The memorandum of understanding states that, if public hearings are requested, the provincial authorities will consider the possibility of mediation rather than holding public hearings. The memorandum of understanding also states that each party can unilaterally terminate it by written notice. [ 25 ] In November 2008, in furtherance of the memorandum of understanding, IMTT submitted to the provincial authorities a project notice for the seven tanks. A provincial directive was sent in December 2008 regarding the nature, scope and extent of the project.

In November 2009, IMTT filed its impact assessment statement with the provincial authorities. On three occasions between March 2010 and December 2011, various levels within Quebec’s Ministère de l’Environnement submitted questions and comments. Finally, in July 2012, more than three and a half years after the initial project notice, Quebec’s Minister of the Environment decided to give the Bureau d’audiences publiques sur l’environnement (“ BAPE ”) the task of holding a public hearing regarding the project.

The BAPE is the provincial agency created under the EQA to hold public hearings when required by the provincial minister. [ 26 ] On September 20, 2012, IMTT sent the required notice to terminate the memorandum of understanding. It stated that it would not participate in the BAPE’s process, the hearing having been scheduled on October 29, 2012, so that the issue of the province’s constitutional jurisdiction could be decided by a court.

Shortly thereafter, IMTT and the QPA filed a joint application for a declaratory judgment seeking a declaration that the facilities and activities of IMTT in the harbour of Quebec, as well as those of the QPA with respect to IMTT, are not subject to the EQA . [ 27 ] There are also two other disputed projects. [ 28 ] First, IMTT carried out work to modify its facilities to comply with the Storage Tank Systems for Petroleum Products and Allied Petroleum Products Regulations [9] enacted by the federal government in 2008.

It took advantage of this work to replace the truck loading ramp in order to increase the number of loading islands and equip them with new technology. IMTT informed the QPA about the ramp replacement project in June 2011. The QPA’s Environmental Assessment Committee approved the project in September 2011, and the work began in the fall and was completed in May 2012. [ 29 ] As with the new tanks built in 2007-2008, IMTT did not apply for an authorization under the EQA for the new loading ramp.

Following an inspection by a provincial employee, on September 18, 2012, the provincial authorities issued a notice of non-compliance under the EQA , claiming that the work had been performed without the provincial authorizations required under ss. 22 , [10] 32 [11] and

48 [12] of the EQA . [ 30 ] Moreover, for quite some time, Degussa Canada Ltd. had been operating a marine terminal on the site to receive and store hydrogen peroxide. This terminal had been authorized by certificate of authorization issued in 1995 under s. 22 EQA . Ownership of the tanks, pipelines and pumps was assigned to IMTT in December 2011 so it could use them to receive, store and deliver other products, including biodiesel and vegetable oil.

On February 23, 2012, the provincial authorities required a certificate of authorization under s. 22 EQA in order to allow IMTT to operate the facilities it had acquired from Degussa Canada; IMTT refused to apply for the certificate of authorization. II. THE PROCEEDINGS 1. The AGQ’s proceedings [ 31 ] In its application for an injunction in file 200-17-010101-087, the AGQ noted that IMTT had built seven tanks without an environmental assessment having been carried out under the EQA and without an authorization having been granted by the Government of Quebec as required under the EQA .

It also noted that IMTT and its predecessors had complied with provincial environmental procedures for several years. The AGQ argued that this should continue to be the case.

It therefore asked that IMTT be ordered by the court to submit to the environmental impact assessment and review process under the EQA for the seven-tank project and that it be prohibited from using these tanks until it received a certificate of authorization from the Government of Quebec under the EQA . [ 32 ] In seeking the injunction, the AGQ relied primarily on s. 31.1 of the EQA , which prescribes that no person may undertake any construction, work, activity or operation provided for by regulation without obtaining a certificate of authorization from the Government of Quebec, which certificate will only be issued after the environmental impact assessment procedure provided for in the EQA is followed .

It is common ground that the projects IMTT carried out with the QPA’s authorization in the harbour of Quebec would fall under that provision of the EQA and other related provisions pertaining to environmental impact assessment and review if these provisions are constitutionally applicable and operative. [ 33 ] It should be noted that since the proceedings were instituted and subsequent to the judgment under appeal, the EQA was substantially amended by the Act to amend the Environment Quality Act to modernize the environmental authorization scheme and to amend other legislative provisions, in particular to reform the governance of the Green Fund [13] (the “ 2017 Amending Act ”).

Pursuant to s. 289 of the 2017 Amending Act , the new provisions of the EQA dealing with the authorization and assessment of projects are applicable to most of the pending situations. All the parties agree that the constitutional issues raised by them and the conclusions of the judgment under appeal are not really affected by the legislative amendments brought about by the 2017 Amending Act . [ 34 ] On March 4, 2013, as part of its injunctive proceedings, the AGQ served the QPA, IMTT and the AGC with a notice in which it also sought a declaration by the Superior Court invalidating (a) s. 8(2)(

d) of the Canada Marine Act , which provides that the letters patent of a Canadian port authority must set out the federal immovables and federal real property under the management of the port authority; (

b) s. 3.2 of the letters patent of the QPA, which states that the federal real property that is managed by the APQ is described in

Schedule B; and (

c) Schedule B of these letters patent, which describes the harbour of Quebec in the list of federal real property. [ 35 ] The AGQ argued that, contrary to what is stated in the federal letters patent, the harbour of Quebec belongs to the Government of Quebec. The AGQ acknowledged that the harbour is under the management of the QPA, but in its opinion, pursuant to s. 109 of the Constitution Act, 1867 , ownership of the harbour belongs to the Government of Quebec. 2.

The QPA’s and IMTT’s proceedings [ 36 ] In their joint application in file 200-17-017062-126, the QPA and IMTT sought court declarations confirming that the site on which IMTT operates is federal public property. In their view, the river-bed was transferred to the Quebec Harbour Commissioners prior to Confederation. Therefore, the site was not contemplated in ss. 108 and 109 of the Constitution Act, 1867 , because it was not part of the public domain on July 1, 1867.

They assert that it vested in the federal Crown between 1936 and 1954 through various federal statutes, and was ultimately placed under the management of the QPA in 1999 in its letters patent. [ 37 ] The QPA and IMTT also argued that IMTT’s activities are closely integrated with and essential to the exclusive federal jurisdiction over navigation and shipping, as well as its jurisdiction over interprovincial and international transportation.

According to them, it is a federal undertaking. [ 38 ] They were also of the opinion that the facilities and activities of IMTT in the harbour of Quebec, as well as those of the QPA with respect to IMTT, are not subject to the EQA .

They raised two constitutional grounds in support of their arguments: the doctrine of interjurisdictional immunity and, subsidiarily, the doctrine of federal paramountcy. [ 39 ] The QPA and IMTT are of the opinion that, pursuant to the doctrine of interjurisdictional immunity, the EQA is inapplicable because it impairs the federal government’s exercise of activities that fall within the core of its exclusive jurisdiction, namely, its power over federal public property under s. 91 (1A) of the Constitution Act, 1867 (“The Public Debt and Property / la dette et la propriété publique ”), its power over ports under s. 91(10) (“Navigation and Shipping / la navigation et les bâtiments ou navires ( shipping ) ”) and its power over interprovincial and international transportation under ss. 92(10)(

a) and ( b ). [ 40 ] Subsidiarily, they rely on the doctrine of federal paramountcy. They argue that the EQA is constitutionally inoperative with respect to IMTT’s facilities and activities, because there is both an operational conflict and a frustration of purpose between the EQA and federal port and environmental legislation.

3. The AGC’s intervention [ 41 ] The AGC intervened in first instance to fully support the QPA’s and IMTT’s claims. III. THE TRIAL JUDGMENT [ 42 ] In file 200-17-010101-087, the judge dismissed the AGQ’s application for an injunction seeking to compel IMTT (

a) to submit the establishment of seven bulk liquid storage tanks located in the port of Quebec to the environmental impact assessment and review process provided for in ss. 31.1 to 31.9 EQA , as those sections read at that time; [14] and (

b) to stop using these tanks until the issuance of a provincial authorization in accordance with the EQA . [ 43 ] In file 200-17-017062-126, the judge partially granted the QPA’s and IMTT’s application and made the following declarations: [15] [ translation ] [269] DECLARES that the immovables leased by the Quebec Port Authority to IMTT-Québec are federal immovables within the meaning of the Canada Marine Act and s. 2 of the Federal Real Property and Federal Immovables Act; [270] DECLARES that these immovables are located within the boundaries of the harbour of Quebec and that, accordingly, all the facilities of IMTT-Québec contemplated in the dispute are deemed to be located in every respect on federal public property; [271] DECLARES that the activities and operations of IMTT-Québec are closely integrated with navigation and shipping in Canada, such that they fall under the Canada Marine Act , the Canadian Environmental Assessment Act and the regulations made under both those statutes; [272] DECLARES that all the provisions of Quebec’s Environment Quality Act and its regulations that require provincial authorizations, including rules pertaining to operations or inspections, as well as those setting out the sanctions, orders, penalties or other measures that can be imposed, notably under ss. 20 to 27, 31.1 to 31.31, 31.42 to 31.69, 32, 70.1, 113 to 115.4 and 115.13 to 115.32 EQA and its regulations, are constitutionally inoperative with respect to the operations and facilities of the Quebec Port Authority pertaining to IMTT-Québec, and with respect to the operations and facilities of IMTT-Québec Inc. on the site of the Quebec Port Authority, insofar as such provisions frustrate Parliament’s purposes under the Canada Marine Act , the Canadian Environmental Assessment Act and the regulations adopted under both those statutes; [ 44 ] The trial judge based his conclusions on the following reasoning. 1.

Ownership of the land [ 45 ] All of the parties agree that the site leased by the QPA to IMTT forms part of the immovables vested in trust in the Quebec Harbour Commissioners prior to Confederation pursuant to

An Act to provide for the improvement and management of the Harbour of Quebec [16] (the “ 1858 Act ”) enacted by the Legislative Assembly of the united Province of Canada, which, at the time, consisted of Upper Canada and Lower Canada.

Section 3 of the 1858 Act provides for the creation of a body corporate and politic under the name of the “Quebec Harbour Commissioners” comprised of five commissioners.

Section 1 of the 1858 Act defines the harbour of Quebec, while s. 2 (amended in 1862 by

An Act to amend the Act to provide for the improvement and management of the Harbour of Quebec [17] (the “ 1862 Act ”)) states that the immovables on the north shore of the harbour that belong to the Crown are “vested (...) in trust” in said Commissioners for purposes of the Act (“ dévolus et confiés (...) pour les fins du présent acte ”). [ 46 ] The judge interpreted these words as transferring ownership, relying on Professor Debruche’s report (which was prepared at the request of the AGQ, but was filed as doctrine by the AGC [18] ) to conclude that under the common law, within the context of a public trust, the trustee is generally the legal owner of the property, while the beneficiaries are owners in equity. [ 47 ] At the end of his analysis, the judge concluded that the Crown’s ownership of the immovables referred to in s. 2 of the 1858 Act had thereby been acquired by the Quebec Harbour Commissioners, such that these immovables were no longer part of the Crown’s public domain when the Constitution Act, 1867 came into force on July 1, 1867.

He also concluded that these immovables had subsequently been transferred to the federal Crown through various subsequent federal statutes. [ 48 ] In the event his conclusion regarding the transfer of ownership to the Quebec Harbour Commissioners was wrong, the judge nevertheless continued his analysis and considered the effect of s. 108 of the Constitution Act, 1867 . He concluded that the statutory demarcation of a public harbour in a pre-Confederation statute spoke for itself and did not raise any ambiguity regarding the application of s. 108 and the Third

Schedule of the Constitution Act, 1867 . 2. IMTT is a federal undertaking closely integrated with navigation and shipping as well as extra-provincial transportation [ 49 ] The judge analyzed IMTT’s activities and concluded that they were closely integrated with navigation and shipping as well as extra-provincial transportation, making IMTT a federal undertaking. [19] The conclusion of the judgment, however, was limited to declaring that the activities and operations of IMTT are closely integrated with navigation and shipping in Canada.

3. The doctrine of interjurisdictional immunity [ 50 ] The judge was of the opinion that the doctrine of interjurisdictional immunity could not apply, given the lack of decisive constitutional jurisprudence declaring a provincial environmental statute inapplicable to federal public property or to a federal undertaking operating in the field of navigation and shipping. 4.

The doctrine of federal paramountcy [ 51 ] The judge found that there was both an operational conflict and a frustration of purpose between the EQA and the federal legislation pertaining to IMTT’s facilities and activities within the port of Quebec. [ 52 ] The operational conflict resulted from the dichotomy between the decision-making power conferred on the QPA by Parliament as regards the approval of projects involving marine activities in the port of Quebec and the possibility of discretionary provincial action under the EQA that would thwart the federally granted power. [20] [ 53 ] The judge’s conclusion, however, relied above all on frustration of purpose.

He analyzed the provisions of the statutes and regulations pertaining to federal ports and concluded that Parliament and the federal government had established a complete set of standards regarding the management and activities of Canadian ports, including environmental matters, in order to [ translation ] “have the last word, in the event of a conflict or disagreement, with respect to anything pertaining to its port facilities in the country”. [21] [ 54 ] The judge was of the opinion that the most obvious frustration of purpose resulted from the numerous provisions in the EQA conferring a quasi-absolute discretionary power on the provincial authorities in respect of the admissibility and acceptability of any proposal liable to have any environmental impact whatsoever. [22] IV.

THE LEGISLATIVE CONTEXT 1. The Constitution Act, 1867 [ 55 ] Environmental protection is a major challenge of our time, with international, national and local dimensions, requiring a commitment from governments at all levels. [23] The environment is not a separate head of power under the Constitution Act, 1867 .

Consequently, the various levels of government can legislate on the environment insofar as the legislation can be linked to an appropriate head of power. [24] Because federal and provincial constitutional powers differ, “the extent to which environmental concerns may be taken into account in the exercise of a power may vary from one power to another”. [25] [ 56 ] The case at bar involves an overlap between federal and provincial legislation: IMTT is subject to federal statutes and regulations and, together with the AGC and the QPA, it contests the parallel application of the EQA . [ 57 ] The AGC, the QPA and IMTT are relying on three federal powers, namely (

a) federal public property, (

b) navigation and shipping, and (

c) interprovincial and international transportation, which spheres of jurisdiction are set out in ss. 91(1A), 91(10) and 92(10)(

a) and (

b) of the Constitution Act, 1867 , while the AGQ and the interveners are basing their arguments on property and civil rights and matters of a merely local or private nature in the province, which powers are set out in ss. 92(13) and (16): 91.

It shall be lawful for the Queen, by and with the Advice and Consent of the Senate and House of Commons, to make Laws for the Peace, Order, and good Government of Canada, in relation to all Matters not coming within the Classes of Subjects by this Act assigned exclusively to the Legislatures of the Provinces; and for greater Certainty, but not so as to restrict the Generality of the foregoing Terms of this Section, it is hereby declared that (notwithstanding anything in this Act) the exclusive Legislative Authority of the Parliament of Canada extends to all Matters coming within the Classes of Subjects next hereinafter enumerated; that is to say, 91.

Il sera loisible à la Reine, de l’avis et du consentement du Sénat et de la Chambre des Communes, de faire des lois pour la paix, l’ordre et le bon gouvernement du Canada, relativement à toutes les matières ne tombant pas dans les catégories de sujets par la présente loi exclusivement assignés aux législatures des provinces; mais, pour plus de garantie, sans toutefois restreindre la généralité des termes ci- haut employés dans le présent article, il est par la présente déclaré que (nonobstant toute disposition contraire énoncée dans la présente loi) l’autorité législative exclusive du parlement du Canada s’étend à toutes les matières tombant dans les catégories de sujets ci-dessous énumérés, savoir : (…) […] 1A.

The Public Debt and Property. 1A. La dette et la propriété publiques.

(…) […] 10. Navigation and Shipping. 10. La navigation et les bâtiments ou navires ( shipping ). (…) […] 92. In each Province the Legislature may exclusively make Laws in relation to Matters coming within the Classes of Subjects next hereinafter enumerated; that is to say, 92. Dans chaque province la législature pourra exclusivement faire des lois relatives aux matières tombant dans les catégories de sujets ci-dessous énumérés, savoir : (…) […] 10. Local Works and Undertakings other than such as are of the following Classes: 10. Les travaux et entreprises d’une nature locale, autres que ceux énumérés dans les catégories suivantes : (

a) Lines of Steam or other Ships, Railways, Canals, Telegraphs, and other Works and Undertakings connecting the Province with any other or others of the Provinces, or extending beyond the Limits of the Province: (

b) Lines of Steam Ships between the Province and any British or Foreign Country:

a) Lignes de bateaux à vapeur ou autres bâtiments, chemins de fer, canaux, télégraphes et autres travaux et entreprises reliant la province à une autre ou à d’autres provinces, ou s’étendant au-delà des limites de la province;

b) Lignes de bateaux à vapeur entre la province et tout pays dépendant de l’empire britannique ou tout pays étranger; (…) […] 13. Property and Civil Rights in the Province. 13. La propriété et les droits civils dans la province; (…) […] 16. Generally all Matters of a merely local or private Nature in the Province. 16.

Généralement toutes les matières d’une nature purement locale ou privée dans la province. [ 58 ] In the case at bar, although the parties do not agree on the application of s. 91(1A), they all acknowledge that the relevant legislative and regulatory provisions, including the EQA , have been validly enacted and fall within the respective jurisdictions of the federal or provincial government, as the case may be. 2. Federal statutes and regulations [ 59 ] Port activities are governed by federal statutes and regulations.

In addition to this legislation, there are more specific instruments dealing with federal environmental assessments and, more specifically, the storage of petroleum products in Canadian ports. (

a) The Canada Marine Act [ 60 ] In 1998, Parliament reorganized the structure of federal ports by adopting the Canada Marine Act . [26] The long-form title of this statute reveals that its principal aim is to make the system of Canadian ports competitive, efficient and commercially oriented by providing, among other things, for the establishment of separate port authorities in each major Canadian port. [ 61 ] The statute seeks primarily to achieve economic growth and international competitiveness while protecting the environment. [27] During parliamentary debates on the enactment of the statute, the federal Minister of Transport described the government’s objectives as follows: [28] The revised act will consolidate and simplify maritime regulations, reduce red tape, and speed up commercial decision-making.

It will

enable the ports to meet client needs more efficiently and to reduce the bureaucracy. Overall, it will make our maritime sector competitive. Parliament sought to achieve these objectives through decentralized and independent commercially-driven port management. [ 62 ] Each designated port authority, including the QPA, must operate the port whose management has been entrusted to it. This includes primarily direct port activities it must engage in as agent of the federal Crown, namely, activities “related to shipping, navigation, transportation of passengers and goods, handling of goods and storage of goods” as set out in s. 28(2)(

a) of the Canada Marine Act . [29] [ 63 ] As set out in s. 28(2)(

b) of the Canada Marine Act , [30] a port authority may also, itself or through a subsidiary — but not as agent of the Crown — engage in other activities secondary to its principal mandate, insofar as these are set out in its letters patent and deemed necessary to support the port operations under its management. [ 64 ] A port authority must also adopt a detailed land-use plan that contains objectives and policies for the physical development of the real property and immovables that it manages, holds or occupies and that takes into account relevant social, economic and environmental matters and zoning by-laws that apply to neighbouring lands. [31] (

b) The Port Authorities Operations Regulations [ 65 ] The Port Authorities Operations Regulations [32] complete the Canada Marine Act by establishing a detailed regulatory framework regarding the activities permitted in each port managed by a port authority. Columns 1 and 3 of

Part 9 of

Schedule 1 to these regulations list the activities permitted within the port of Quebec with the authorization of the QPA: [33] 4. Placing, storing, handling or transporting dangerous goods […] 4. Placer, entreposer, manutentionner ou transporter des marchandises dangereuses […] 7. Carrying out an oil transfer operation, a chemical transfer operation or a liquefied gas transfer operation […] 7. Effectuer des opérations de transbordement d’hydrocarbures, de produits chimiques ou de gaz liquéfié […] 10. Transhipping, loading and unloading cargo […] 10.

Transborder, charger ou décharger des cargaisons […] [ 66 ] In order to engage in one of these activities within the port of Quebec, a person, such as IMTT, must obtain the QPA’s written authorization, which authorization will be granted insofar as the soil, air or water quality is not adversely affected by these activities or, where applicable, where these adverse effects can be mitigated or prevented. [34] (

c) Letters patent of the port authorities [ 67 ] The letters patent of the port authorities supplement the provisions of the Canada Marine Act and the Port Authorities Operations Regulations . In the case of the QPA, these letters patent came into force on May 1, 1999. [35] Among other things, they provide that the QPA’s board of directors shall consist of seven members appointed by the Governor in Council, the cities of Quebec, Sillery and Beauport and the Government of Quebec. [36] [ 68 ]

Schedule B of the letters patent describes the federal real property that is managed by the QPA, including the federal real property comprising the harbour of Quebec where IMTT’s tanks and other equipment are located and where IMTT carries on its activities within the port of Quebec. [37] The letters patent allow the QPA to lease these federal immovables for port purposes, [38] which is the case as regards IMTT. [39] [ 69 ]

Schedule C of the letters patent contains a description of the real property, other than federal real property, that is occupied or held by the QPA. [40] The real property described in

Schedule C is not at issue in the case at bar. (

d) The 1992 Canadian Environmental Assessment Act and the Canada Port Authority Environmental Assessment Regulations [ 70 ] The 1992 Canadian Environmental Assessment Act [41] establishes a specific regulatory scheme for Canadian port authorities through which they can, during the planning stage and before granting their authorization, assess the environmental impact of the projects they authorize, particularly projects carried out on federal lands. [42] [ 71 ] This was followed by the enactment, in 1999, of the Canada Port Authority Environmental Assessment Regulations . [43] They provide, among other things, that a Canadian port authority must carry out an environmental assessment of a project before leasing any part of the federal lands it administers, or an interest therein, for the purpose of enabling the project. [44] [ 72 ] Save for cases in which a project is subject to assessment by a federal review panel, it is the port authority that determines the

scope of a project in relation to which an environmental assessment is to be conducted.

The assessment includes a screening that takes into consideration the environmental effects of the project, including the environmental effects of malfunctions or accidents that may occur in connection with the project, any cumulative environmental effects that are likely to result from the project, and technically and economically feasible measures that would mitigate any significant adverse environmental effects of the project. [45] [ 73 ] After taking into consideration the screening report, the port authority may lease the federal lands it administers, or an interest therein, for the purpose of enabling the project, but only where, taking into account the implementation of any technically and economically feasible mitigation measures whose implementation it must ensure, the project is not likely to cause significant adverse environmental effects. [46] If that is not the case, the Canadian port authority cannot lease the federal lands, or an interest therein, for the purpose of enabling the project. [47] Where the effects are uncertain or public concerns warrant it, the project is referred to a federal review panel. [48] [ 74 ] Furthermore, s. 4(1)( b.2 ) of the statute states that its purpose is also to promote cooperation and coordinated action between federal and provincial governments with respect to environmental assessment processes for projects. (

e) The Canadian Environmental Assessment Act, 2012 [ 75 ] Since the Canadian Environmental Assessment Act, 2012 [49] came into force, Canadian port authorities have been “federal authorities” within the meaning of that statute. [50] One of the principal purposes of the statute is to ensure that projects carried out on federal lands are considered in a careful and precautionary manner to avoid significant adverse environmental effects. [51] [ 76 ] To that end, s. 67 of the statute gives a Canadian port authority the task of determining whether or not the carrying out of a project on federal lands it administers is liable to cause significant environmental effects. [52] If the effects are indeed significant, s. 69 of the statute in turn gives the Governor in Council the task of determining whether those effects are justified in the circumstances in order to allow the use of the federal lands for the purpose of enabling the project. [53] [ 77 ] The legislation also reiterates the purpose of promoting cooperation and coordinated action between federal and provincial governments with respect to environmental assessments. [54] (

f) The Storage Tank Systems for Petroleum Products and Allied Petroleum Products Regulations [ 78 ] The Storage Tank Systems for Petroleum Products and Allied Petroleum Products Regulations [55] were enacted under the Canadian Environmental Protection Act, 1999 . [56] In them, the government of Canada prescribes a detailed regulatory scheme dealing with storage tank systems for petroleum products and allied petroleum products belonging to or operated by a federal undertaking in connection with the activities of a Canadian port authority.

The purpose of the regulations is to reduce the risk of soil and groundwater contamination caused by spills or leaks of petroleum products and allied petroleum products from such storage tank systems. [57] They require new systems to comply with strict technical standards reasonably liable to ensure that there will not be any releases into the environment, notably through the use of aboveground facilities, secondary containment infrastructures and monitoring, detection and warning systems. The regulations also require that existing systems be significantly enhanced.

Moreover, they require leak detection tests as well as inspections. 3. The Quebec Environment Quality Act [ 79 ] In Quebec, the EQA is the fundamental environmental statute. Like federal environmental legislation, it reflects society’s growing concern with ensuring the quality of the natural environment for current and future generations. [58] [ 80 ] The EQA was significantly amended in 2017, by the 2017 Amending Act adopted after the trial judgment was rendered in the case at bar. [59] Most of these legislative changes came into force in March 2018. They did not affect the fundamental structure of the EQA .

The parties agree that the new provisions of the EQA must be considered in order to decide the appeal, as the jurisprudence requires, [60] so that the declaratory judgment can resolve in a practical manner the issues raised by the parties. [ 81 ] Given the breadth and complexity of the environment, this area does not always lend itself to precise codification of rules.

As a result, environmental protection legislation often seeks both to regulate pollution and to prevent it by non-regulatory means that include impact assessment studies allowing public authorities to make informed decisions when authorizing development projects.

The EQA reflects this dichotomy . [ 82 ] As this Court has often concluded, the EQA is based on two principal schemes: [61] (1) the first, normative and prohibitive in nature, controls the release of contaminants into the environment through prohibitions set out in s. 20 EQA ; (2) the second, preventive in nature, subjects development projects to a discretionary provincial authorization to ensure their impact on the environment is evaluated and, if necessary, mitigated; this scheme is based primarily on ss. 22, 31.1 and 31.1.1 EQA . [ 83 ] The scheme under s. 20 is based on three prohibitions: (1) a prohibition on releasing any contaminant into the environment in a quantity or concentration greater than that determined in accordance with the EQA , (2) a complete prohibition with respect to contaminants prohibited by regulation, and (3) a more general prohibition targeting the release of any contaminant whose presence in the environment “is likely to adversely affect the life, health, safety, welfare or comfort of human beings, or cause damage to or otherwise

impair the quality of the environment or ecosystems, living species or property”. [62] [ 84 ]

Section 22 EQA , whether in its current form or prior to the 2017 Amending Act , stipulates that, in general, no one may carry out an industrial project in Quebec without the prior authorization of Quebec’s Minister of the Environment. Generally speaking, the authorization will be granted only after an environmental impact assessment, which may be more or less detailed depending on the scope of the project and its foreseeable impacts. [63] The Minister may refuse the authorization or couple it with conditions and even standards or restrictions that differ from those prescribed by regulation. [ 85 ]

Section 31.1 EQA specifies that, in the cases provided for by regulation, a person must obtain the authorization of the government, rather than the Minister, by following the environmental impact assessment and review procedure established by the EQA , which includes an environmental impact assessment statement and, if applicable, a public hearing before the BAPE, a provincial body. [64] [ 86 ]

Section 31.1.1, which was added to the EQA by the 2017 Amending Act , allows the Government of Quebec to subject a project not referred to in s. 31.1 (i.e., not prescribed by regulation) to an environmental impact assessment and review procedure if, among other reasons, it is of the view that major environmental issues are involved and public concern warrants it. [ 87 ] For a project referred to in s. 31.1 or 31.1.1 EQA , the Government of Quebec may authorize it with or without amendment and subject to the conditions, restrictions or prohibitions it determines, or refuse to authorize it. [65] Since the 2017 amendments, the Government of Quebec has had additional powers allowing it to include in an authorization any standard, condition, restriction or prohibition that differs from those prescribed by a regulation made under the EQA . [66] These new powers, like those of Quebec’s Minister of the Environment, allow the Government of Quebec to regulate each project in a specific and individual way. [ 88 ] Be it pursuant to the Regulation respecting environmental impact assessment and review [67] or its 2018 replacement, the Regulation respecting the environmental impact assessment and review of certain projects , [68] the parties agree that IMTT could not carry out its projects and activities without an authorization issued by the Government of Quebec under s. 31.1 EQA , insofar as this

section were to apply to them. [ 89 ] The EQA contains a counterpart to the previously mentioned collaborative provision contained in the Canadian Environmental Assessment Act, 2012 : when a project is referred to in s. 31.1 or 31.1.1 EQA and is also subject to an environmental assessment procedure prescribed by another legislative authority, the Minister may make an agreement to coordinate the environmental assessment procedures. [69] V.

THE DOCTRINE OF INTERJURISDICTIONAL IMMUNITY [ 90 ] The doctrine of interjurisdictional immunity operates to prevent laws enacted by one level of government — in this case the Government of Quebec — from impermissibly trenching on the “unassailable core” of jurisdiction reserved for another level of government — here the government of Canada. [70] When it applies, the effect of the doctrine is to render laws validly enacted by one level of government inapplicable to works, undertakings, things, persons or activities that fall within the exclusive jurisdiction of the other level of government. [71] This doctrine has been the subject of numerous court decisions, particularly with respect to federal public property, navigation, aeronautics, telecommunications, and interprovincial and international transportation. [72] [ 91 ] The doctrine is rooted in the notion of exclusivity that emerges from ss. 91 and 92 of the Constitution Act, 1867 .

In Bell Canada v.

Québec (Commission de la santé et de la sécurité du travail) , [73] the Supreme Court of Canada stated that the doctrine ensures that the classes of subjects listed in ss. 91 and 92 of the Constitution Act, 1867 have “a basic, minimum and unassailable content […]” [74] which, given the exclusive nature of these powers, is immune from the application of legislation enacted by the other level of government. [ 92 ] The Supreme Court of Canada, in Canadian Western Bank , reshaped the doctrine, due to its potential impact on Canadian constitutional arrangements and its asymmetrical application that had favoured federal heads of power. [75] Today, the emphasis is on the legitimate interplay between federal and provincial powers. [76] The modern trend, in areas of overlapping jurisdiction, is to strike a balance between the federal and provincial governments, through the application of pith and substance analysis and a restrained application of the doctrine of federal paramountcy. [77] [ 93 ] Notwithstanding the foregoing, in Canadian Western Bank , the Supreme Court of Canada confirmed the continued use of the doctrine of interjurisdictional immunity for ensuring a “basic, minimum and unassailable content” [78] for the classes of subjects listed in ss. 91 and 92 of the Constitution Act, 1867 .

This “minimum content” refers to the content that is “necessary to make the power effective for the purpose for which it was conferred”. [79] [ 94 ] Thus, while, in principle, the doctrine of interjurisdictional immunity is of limited application, it has not been removed from the analysis of Canadian federalism. [80] It applies if the required conditions have been met. The doctrine has served principally to protect federal jurisdiction over certain property and persons (such as Aboriginal lands [81] and federal corporations [82] ).

The Supreme Court is of the view that, as a general rule, the doctrine should apply only to situations already covered by precedent. [83]

[ 95 ] Even in situations where the doctrine of interjurisdictional immunity may properly be raised, the court must always consider the level of the intrusion on the “core” of the power in question. It is not enough for the legislation of one level of government to affect the core of a power or purpose of the other level of government; it must “impair” it, without necessarily having to “sterilize” or “paralyze” it. [84] [ 96 ] Here, the AGC, the QPA and IMTT are invoking the federal powers over federal public property, over navigation and shipping, and over interprovincial or international transportation.

We conclude that the first two heads of power may be invoked, but not the power over interprovincial or international transportation (discussed below under subsections 1, 2 and 3, respectively).

We also conclude that there is precedent dealing with federal public property and with navigation and shipping, such that the doctrine of interjurisdictional immunity can be applied (discussed below under subsection 4) and that certain provisions of the EQA impair the basic and unassailable content of these powers, which content is necessary to make the powers effective for the purpose for which they were conferred (discussed below under subsection 5). 1.

Jurisdiction over federal public property [ 97 ] The AGQ submits that jurisdiction over federal public property cannot be invoked because the lands on which IMTT’s facilities are located belong to Quebec, not Canada. The AGQ bases this argument on three premises:

(1) The Crown did not transfer ownership of the immovables located on the north shore of the harbour of Quebec to the Quebec Harbour Commissioners through s. 2 of the 1858 Act , such that these immovables were “public lands” within the meaning of s. 109 of the C onstitution Act, 1867 when it came into force.

(2) Only public property actually used as a public harbour in 1867 is covered by s. 108 and the Third

Schedule of the Constitution Act, 1867 , whether or not such property is included within a public harbour defined in a pre-Confederation statute.

(3) The site on which IMTT’s facilities are now built and operated was not used for purposes of a public harbour when the Constitution Act, 1867 came into force and, therefore, cannot be covered by s. 108 and the Third

Schedule of the Constitution Act, 1867 . [ 98 ] If any of these three premises is wrong, the AGQ’s appeal regarding ownership of the IMTT site must be dismissed. That being said, the Court accepts none of these premises. (

a) The immovables contemplated in s. 2 of the 1858 Act were transferred to the Quebec Harbour Commissioners and were therefore not public lands within the meaning of s. 109 of the Constitution Act, 1867 [ 99 ] The first question that must be answered is whether s. 2 of the 1858 Act had the effect of transferring ownership of the immovables described therein to the Quebec Harbour Commissioners. If so, the parties acknowledge that these immovables were not part of the public domain at the time of Confederation and are not affected by ss. 108 and 109 of the Constitution Act, 1867 .

If not, the immovables were part of the public domain at the time of Confederation and ss. 108 and 109 of the Constitution Act, 1867 must be analyzed. [ 100 ] Given the importance of ss. 1 and 2 of the 1858 Act (as amended by the 1862 Act ) for purposes of this question, it is worthwhile reproducing them here: 1. The Harbour of Quebec shall , for the purposes of this Act, comprise that part of the river St.

Lawrence which lies between a line drawn from the west side of the mouth of the river Cap Rouge, to the west side of the mouth of the river Chaudière, and a line drawn from the east side of the mouth of the river Montmorency, to the east side of the Cove called Indian Cove, on the south side of the said river St. Lawrence, together with that part of each of the said rivers Cap Rouge, Chaudière and Montmorency, and of the rivers St. Charles , Etchemin and Beauport, where the tide ebbs and flows. 1. Le havre de Québec comprendra , pour les fins du présent acte, cette

partie du fleuve St. Laurent qui est située entre une ligne tirée depuis le côté ouest de l’embouchure de la rivière du Cap-Rouge jusqu’au côté ouest de l’embouchure de la rivière Chaudière, et une ligne tirée depuis le côté est de l’embouchure de la rivière Montmorency jusqu’au côté est de l’anse appelée « Anse des Sauvages, » du côté sud du dit fleuve St. Laurent, avec ensemble cette

partie de chacune des dites rivières Cap- Rouge, Chaudière et Montmorency, et des rivières St. Charles , Etchemin et Beauport, où la marée monte et descend .

2. All land below the line of high water on the north side of the River St. Lawrence and all land below the line of high water mark on the rivers Cap-Rouge and Montmorency, and on the rivers St.

Charles and Beauport, where the tide ebbs and flows, within the said limits, now belonging to Her Majesty, whether the same be or be not covered with water , the moneys arising from which are not by law appropriated or directed to be applied exclusively to any other purpose, together with all rents and sums of money now due or hereafter to become due to Her Majesty, and not already by law appropriated or directed to be applied exclusively to any other purpose, either for interest or principal, or in any other way, in respect of any land below the line of high water within said limits heretofore granted by Her Majesty, whether the same be or be not covered with water, shall be vested in the Corporation hereinafter mentioned, in trust for the purposes of this Act: Provided always that every Riparian and other proprietor of a deep water pier, or any other property within the said boundaries, shall continue to use and enjoy his property and moorings berths in front thereof, as he now uses the same, until the said Corporation shall have acquired the right, title and interest which any such proprietor may lawfully have in and to any beach property or water lot within the said boundaries; nor shall the rights of any person be abrogated or diminished by this Act in any manner whatever: And provided also, that nothing herein contained shall in any way affect the lands or any parts of the lands constituting the estate of the late Order of Jesuits, appropriated to Educational purposes by the Act nineteenth and twentieth Victoria,

chapter fifty- four . (Emphasis added) 2. Seront dévolus et confiés à la corporation ci- dessous mentionnée, pour les fins du présent acte, tous les terrains au-dessous de la ligne des hautes eaux, sur le côté nord du fleuve St.

Laurent, et tous les terrains au-dessous de la ligne des hautes eaux sur les rivières Cap-rouge et Montmorency, et sur les rivières St-Charles et Beauport où le flux et le reflux se font sentir, situés dans les dites limites, et appartenant à Sa Majesté, qu’ils soient ou non couverts d’eau , (si les deniers qui en proviennent ne sont pas par la loi affectés exclusivement à quelqu’autre objet,) de même que toutes les rentes et sommes d’argent maintenant dues ou qui seront par la suite dues à Sa Majesté sur tous terrains situés au-dessous de la ligne des hautes eaux dans les dites limites, et ci-devant cédés par Sa Majesté, et qu’ils soient ou non couverts d’eau, si ces rentes et sommes d’argent ne sont pas déjà par la loi affectées exclusivement à quelque autre objet, soit quant à l’intérêt, soit quant au principal, ou de quelque autre manière; pourvu toujours que chaque propriétaire riverain et autre d’une jetée en eaux profondes, ou de toute autre propriété dans les dites limites, continuera de faire usage et de jouir de sa propriété et des mouillages qui se trouvent en front, comme il en fait actuellement usage, jusqu’à ce que la corporation ait acquis les droit,

titre et intérêt que tel propriétaire peut légalement avoir à l’égard de telle propriété de grève ou lot couvert d’eau dans les dites limites ; et les droits d’aucune personne ne seront anéantis ou diminués par le présent acte, en quelque manière que ce soit; et pourvu aussi, que rien de contenu dans le présent acte n’affectera en rien que ce soit les terrains ou aucune

partie des terrains formant

partie des biens du ci-devant ordre des jésuites, affectés aux fins de l’éducation par l’acte dix-neuf et vingt Victoria,

chapitre cinquante-quatre. [Soulignement ajouté] [ 101 ] The parties acknowledge that the site of IMTT’s facilities is contemplated in s. 2 of the 1858 Act, as amended by the 1862 Act . [ 102 ] In order to determine whether ownership of the site was transferred to the Quebec Harbour Commissioners or whether, instead, the site remained within the public domain under the management of the Commissioners, it is necessary to define the specific legal effect of the “trust” conferred upon the Quebec Harbour Commissioners by the 1858 Act , in the expression “shall be vested in the Corporation hereinafter mentioned, in trust for the purposes of this Act / seront dévolus et confiés à la corporation ci-dessous mentionnée, pour les fins du présent acte ”. [ 103 ] Professor Debruche’s research identifies the difficulties and pitfalls that the

interpretation of the legislation in question raises.

In particular, she points out that the law regarding “trusts” in the first half of the 19th century had little to do with existing law. [85] She also notes the inherent problems in translating the common law concept of “trust” into French, since this institution was not then known in civil law and is essentially incompatible with civilian concepts, such that this could only lead to confusion when drafting in French legislation dealing with a public “trust”, [86] including in the statutes dealing with the “trust” conferred on the Quebec Harbour Commissioners, which statutes provide a striking example of this confusion. [87] [ 104 ] As Professor Debruche notes, the anglo-Canadian common law jurisprudence of that era dealing with legislative “trusts” was not without its ambiguities [88] .

Professor Debruche concludes therefrom that the scope of the rights conferred on the Quebec Harbour Commissioners over the immovables in the harbour of Quebec is uncertain. [89] [ 105 ] The differing opinions in the 1878 case of Coverdale v. Charlton [90] regarding the scope of the word “vest” in respect of property used for public purposes — in this case a street — reflect the ambiguities in the common law of that era. [91] Subsequently, in the 1896 case in Tunbridge Wells Corpn v.

Baird , [92] the Privy Council ruled that the word “vest” can, depending on the context, confer only a management right akin to a right of ownership — while not being a full right of ownership — in respect of property made available to a public body for public purposes. [93]

[ 106 ] Coverdale v. Charlton and Tunbridge Wells Corpn v. Baird are still relevant in the United Kingdom and were in fact recently considered by the Supreme Court of the United Kingdom in London Borough of Southwark and al. v.

Transport for London . [94] [ 107 ] What is the situation of the harbour of Quebec? [ 108 ] According to the AGQ, it is reasonable to believe that the 1858 Act did not have the effect of removing the harbour of Quebec from the public domain, because it was not necessary to do so in order to satisfy the purpose of this statute, which was the efficient administration of the harbour by the Commissioners for purposes of promoting navigation and maritime commerce.

She relies on the Gibb Report published in the early 1930’s [95] – which led to the creation of the National Harbours Board in 1936 – to support the argument that the major ports in Canada were always state ports. [ 109 ] The AGQ adds that an examination of the jurisprudence discloses cases in which the Crown granted immovables to public bodies using “trusts”, without transferring ownership thereof. The remarks of Duff, J., sitting on the Privy Council in Re Star Chrome , are particularly relevant. Relying on Tunbridge Wells Corpn v.

Baird , he stated that the “vesting” of public land in a public body may, depending on the legislative intent indicated by the context, confer only extended powers of management and administration over these lands rather than the ownership thereof: [96] It is not unimportant, however, to notice that the term “vest” is of elastic import; and a declaration that lands are “vested” in a public body for public purposes may pass only such powers of control and management and such proprietary interest as may be necessary to enable that body to discharge its public functions effectively: Tunbridge Wells Corporation v.

Baird , [1896] A.C. 434 , an interest which may become devested when these functions are transferred to another body.

In their Lordships’ opinion, the words quoted from s. 1 are not inconsistent with an intention that the Commissioner should possess such limited interest only as might be necessary to enable him effectually to execute the powers and duties of control and management, of suing and being sued, committed to him by the Act. (Emphasis added) [ 110 ] Duff, J. concluded that two pre-Confederation statutes that set apart certain public lands in Lower Canada for Aboriginals did not confer ownership of these lands upon the functionary in charge of administering them, notwithstanding that they had been “vested in trust” for such purposes. [97] As a result, ownership of these lands vested in the province of Quebec at Confederation, subject to the rights of Aboriginals therein. [ 111 ] Indeed certain court decisions have characterized the rights of the Quebec Harbour Commissioners under s. 2 of the 1858 Act as mere powers of management and administration that did not have the effect of removing the immovables in question from the public domain. [98] [ 112 ] The opposite view, put forth by the AGC, the QPA and IMTT, relies on the principle that, under the common law, a “trustee” must be the “legal owner” of the property placed “in trust”, because this results from the very nature of the concept of “trust”. [99] They distinguish the judgment in Star Chrome – as well as the other judgments relied upon by the AGQ to support the argument that, depending on the context, the word “vest” merely confers a power of management when referring to immovables used for public purposes – by pointing out that the Quebec Harbour Commissioners had significant discretionary powers and broad autonomy when managing their immovables. [ 113 ] Moreover, the AGC, the QPA and IMTT submit several judgments which, according to them, confirm the proposition that full ownership of the immovables contemplated in the 1858 Act vested in the Quebec Harbour Commissioners. [100] [ 114 ] The decisive precedent is the 1918 judgment of the Supreme Court of Canada in Power , [101] which concluded that all the rights conferred by s. 2 of the 1858 Act had been withdrawn from the public domain. [ 115 ] Power dealt with the determination of an expropriation indemnity for an immovable which the Crown had granted to a third party before 1858, but on which it had reserved a right of resumption of a portion thereof upon giving twelve months’ notice.

Cassels, J., of the Exchequer Court, concluded that this right had vested in the Quebec Harbour Commissioners pursuant to s. 2 of the 1858 Act . [102] The effect of that finding was to reduce the expropriation indemnity the owner of the immovable could claim. [ 116 ] The case was appealed before a bench of five judges of the Supreme Court of Canada. The main issue on appeal was the right of the owner of the immovable to claim that the right of the Commissioners to resume possession of the immovable had become prescribed.

Brodeur, J. (writing for himself and Lavergne, J. ad hoc) and Anglin, J. stated that the rights conferred on the Commissioners by the 1858 Act had ceased to form part of the public domain. Brodeur, J. stated the following: [103] [ translation ] But this right, as the Exchequer Court decided, was assigned and conveyed to the Quebec Harbour Commissioners by [the 1858 Act ], and these lands, as well as the rights attaching thereto, ceased to form part of the Crown’s public domain . (…). (Emphasis added) Anglin, J. expressed the same opinion: [104]

If the right of resumption had remained vested in the Crown, I should have been inclined to regard it as a real right declared imprescriptible by art. 2213 C.C. and therefore not within art. 2215 C.C. invoked by counsel for the appellants. But a right vested in the Quebec Harbour Commissioners , notwithstanding their public character and the nature of their trust, does not form part of the Crown domain . Quebec Harbour Commissioners v.

Roche [Q.R. 1 S.C. 365]. (Emphasis added) [ 117 ] The Supreme Court of Canada’s judgment in Power is therefore a key precedent, because it establishes that the rights vested in the Quebec Harbour Commissioners under s. 2 of the 1858 Act ceased to form part of the public domain. We are bound by this precedent, because the case at bar does not raise any new issues, nor does it present a change in the circumstances or evidence that fundamentally shifts the parameters of the debate such that we could choose not to follow this precedent or set it aside. [105] [ 118 ] Moreover, as the trial judge noted, this

interpretation of the 1858 Act has since prevailed and is the

interpretation the Government of Quebec itself has applied in the past: [106] [ translation ] [125] Apart from a few isolated exceptions that can be explained by their context, it appears that, in general, in the wake of the 1858 Act , all those involved, in particular the [Quebec Harbour Commissioners] themselves, behaved and identified themselves as if s. 2 had transferred to them an absolute and unequivocal title to the beach lots and deep water lots currently the subject of the dispute. [126] In this regard, the AG Quebec’s current claims are surprisingly at odds with the reports and testimony of its own experts, notaries Audet and Ayotte and historian Boudreau who, like historians Antaya and Normand and notary Forcier, saw all of the Quebec Harbour Commissioner’s actions as the behaviour of those who, rightly or wrongly, believed they had been given good and valid ownership title to the lands vested in trust in them in 1858. [127] This

interpretation of the 1858 Act is also corroborated by several contemporaneous actions on the part of the Commissioner of Crown Lands, who acknowledged the “ absolute ” right of ownership of the Quebec Harbour Commissioners when settling the Gugy case in 1864, and in his annual reports of that time. [128] Lastly, and above all, in a deed of acquisition entered into with the National Harbours Board in 1938, the Government of Quebec expressly acknowledged that the seller had acquired its title under the 1858 Act .

As notary Forcier pointed out on page 26 of her report, this transaction shows the evolution of the claims made by the Government of Quebec which, in 1938, was not yet arguing that the immovable property “ vested in trust ” in the Quebec Harbour Commissioners in 1858 had subsequently been transferred to it under the Constitution Act, 1867 .

She wrote: On the contrary, by carrying out this acquisition, it appears that the Government of Quebec acknowledged that the immovable had been taken out of the public domain as a result of the 1858 Act and, consequently, that it could not claim title to the immovable in question.

The AG Quebec’s position in the present case is therefore inconsistent with its own historical position. (Emphasis by the trial judge; footnotes omitted) [ 119 ] All of this leads us to conclude, as the trial judge did, that it was the ownership of the immovables described in s. 2 of the 1858 Act that was conferred upon the Quebec Harbour Commissioners.

Consequently, these immovables on the north shore of the harbour were not part of the public domain at Confederation and were therefore not contemplated in s. 108 or s. 109 of the Constitution Act, 1867 on July 1, 1867. [ 120 ] After Confederation, the management, administration and control of the works and property of the Quebec Harbour Commissioners were conferred upon the National Harbours Board through the 1936 Act respecting the National Harbours Board [107] (the “ 1936 Act ”).

All “property acquired or held by the [National Harbours] Board” was then “vested in His Majesty in His right of the Dominion of Canada”. [108] [ 121 ] If, under the 1936 Act , the “property now held” by the Quebec Harbour Commissioners and the other Canadian port corporations “in the name of such Corporation may continue so to be held”, the statute provides that this is for only one purpose, namely, to be “transferred by such Corporation or the [National Harbours] Board to His Majesty”. [109] The 1954 Act to amend the National Harbours Board Act [110] (the “ 1954 Act ”) ultimately repealed the preceding provision. [ 122 ] Thus, the immovables belonging to the Quebec Harbour Commissioners, just as those belonging to the other Canadian port corporations at that time, were incorporated in the federal public domain through the 1936 Act and the 1954 Act.

This is evident in the letters patent of the QPA issued under the Canada Marine Act , in which the government of Canada bases its title to the north shore of the harbour of Quebec on the 1858 Act as amended by the 1862 Act : [111] The federal real property the management of which has been given to the Authority is comprised as follows : Les immeubles fédéraux dont la gestion est confiée à l’Administration comprennent les immeubles suivants :

(

A) The immovables of Her Majesty lying within the boundaries of the harbour of Quebec, as established in the statutes hereinafter referred to, granted to the Québec Harbour Commissioners under the terms thereof as follows:

A) Les immeubles de Sa Majesté situés dans les limites du havre de Québec, telles que fixées dans les lois ci-après mentionnées, concédés aux Commissaires du havre de Québec aux termes des lois suivantes : —

section 2 of the Act to provide for the improvement and management of the Harbour of Quebec (22 Victoria, Cap. XXXII) assented to 24 th July, 1858 , as amended by

section 1 of the Act to amend the Act to provide for the improvement and management of the Harbour of Quebec (25, Victoria, Cap. XLVI) assented to 9 th June, 1862; (…) (Emphasis added) — l’article 2 de l’ Acte pour pourvoir à l’amélioration du havre de Québec et à son administration (22 Victoria, ch. XXXII) sanctionné le 24 juillet 1858 , tel que modifié par l’article 1 de l’Acte pour amender l’acte pour pourvoir à l’amélioration du havre de Québec et à son administration (25, Victoria, ch. XLVI) sanctionné le 9 juin 1862; […] [Soulignement ajouté] [ 123 ] Moreover, s. 12(3)(

b) of the Canada Marine Act specifies that the real property and immovables that the QPA administers or holds on behalf of the federal Crown — whether same are held in its own name or in the name of the Crown — remain the property and rights of the federal Crown. [ 124 ] This conclusion is sufficient to dismiss the AGQ’s appeal regarding ownership of IMTT’s site. We will, however, analyze the other grounds of appeal submitted in this regard by the AGQ. (

b) Section 108 of the Constitution Act, 1867 applies to harbours defined in pre-Confederation legislation [ 125 ] If, contrary to our analysis, the harbour of Quebec was still public property in 1867, it belonged to the pre-Confederation united Province of Canada and was transferred either to the federal crown or to the provincial crown under ss. 108 or 109 of the Constitution Act, 1867 . [ 126 ]

Section 108 and the Third

Schedule of the Constitution Act, 1867 provide that the “public harbours” of each pre-Confederation province shall be the property of Canada as of Confederation: 108. The Public Works and Property of each Province, enumerated in the Third

Schedule to this Act, shall be the Property of Canada. (…) 108. Les travaux et propriétés publics de chaque province, énumérés dans la troisième

annexe de la présente loi, appartiendront au Canada. […] THE THIRD

SCHEDULE PROVINCIAL PUBLIC WORKS AND PROPERTY TO BE THE PROPERTY OF CANADA (…) 2. Public Harbours. (…) TROISIÈME

ANNEXE TRAVAUX ET PROPRIÉTÉS PUBLIQUES DE LA PROVINCE DEVANT APPARTENIR AU CANADA […] 2. Havres publics. […] [ 127 ] As for s. 109 of the Constitution Act, 1867 , it states that the public lands belonging to the pre-Confederation provinces shall belong to the provinces resulting from Confederation:

109. All Lands, Mines, Minerals, and Royalties belonging to the several Provinces of Canada, Nova Scotia, and New Brunswick at the Union, and all Sums then due or payable for such Lands, Mines, Minerals, or Royalties, shall belong to the several Provinces of Ontario, Quebec, Nova Scotia, and New Brunswick in which the same are situate or arise, subject to any Trusts existing in respect thereof, and to any Interest other than that of the Province in the same. 109.

Toutes les terres, mines, minéraux et réserves royales appartenant aux différentes provinces du Canada, de la Nouvelle-Écosse et du Nouveau-Brunswick lors de l’union, et toutes les sommes d’argent alors dues ou payables pour ces terres, mines, minéraux et réserves royales, appartiendront aux différentes provinces d’Ontario, Québec, la Nouvelle-Écosse et le Nouveau-Brunswick, dans lesquelles ils sont sis et situés, ou exigibles, restant toujours soumis aux charges dont ils sont grevés, ainsi qu’à tous intérêts autres que ceux que peut y avoir la province. [ 128 ] We must therefore determine whether the IMTT site was part of a “public harbour” within the meaning of s. 108 and the Third

Schedule of the Constitution Act, 1867 . [ 129 ] The AGQ argues that the jurisprudence dealing with s. 108 of the Constitution Act, 1867 puts forth the principle that a site will be considered a public harbour under the Third

Schedule if it can be shown to have been geographically located within the boundaries of a harbour that was recognized as a public harbour and to have formed an integral part thereof on July 1, 1867, such that, on that date, it was accessible to the public and was used as a commercial port.

The AGQ therefore submits that, as a test, one must look at the actual use of the site to determine the extent of the harbour of Quebec in 1867, regardless of the fact that the boundaries of the harbour might have been set out in a pre-Confederation statute. [ 130 ] The AGQ bases its argument primarily on the 1919 decision in Ritchie , [112] where the Privy Council had to determine whether English Bay near Vancouver was a public harbour within the meaning of s. 108 and the Third

Schedule of the Constitution Act, 1867 . In that case, a company had a provincial permit pursuant to which it removed sand from the foreshore of the sea at the entrance to English Bay near Vancouver.

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