2019 FC 1195, 2019 FC 1195

T-982-19 2019 FC 1195 Attorney General of British Columbia ( Plaintiff ) v. Attorney General of Alberta ( Defendant ) Indexed as: British Columbia (Attorney General) v. Alberta (Attorney General) Federal Court, Grammond J.—Vancouver, September 12 and 13; Ottawa, September 24, 2019.

Practice — Motions (1) by defendant to strike underlying action wherein Province of British Columbia seeking declaration that Province of Alberta’s Preserving Canada’s Economic Prosperity Act (Act) unconstitutional; (2) by plaintiff for interlocutory injunction preventing Minister of Energy of Alberta (Minister) from exercising powers under Act — Act empowering Minister to require licences for energy exports from Alberta, to impose terms, conditions on such exports, including quantity, destination — Comments made by members of Alberta legislature suggesting purpose of Act to inflict economic hardship on British Columbia — Defendant arguing one province cannot challenge another province’s legislation — Constitutional structure not depriving plaintiff of standing to bring its action — Attorney General able to challenge validity of legislation of another province — Provinces having interests in other province’s actions — Challenging other provincial legislation not necessarily affront to province’s “equal sovereignty” — Court not giving effect to defendant’s prematurity objection — Doctrine of public interest standing requiring more flexible approach to issue of prematurity — Declaratory judgments available where rights merely threatened — Factual context helping courts understand practical effects of legislation — However, factual background less necessary in division-of-powers cases — Plaintiff’s action challenging Act itself — Determining Act’s pith, substance not requiring evidence regarding application of Act — Plaintiff satisfying test for interlocutory injunction — Motion to strike dismissed; motion for interlocutory injunction granted.

Federal Court Jurisdiction — Defendant seeking to strike plaintiff’s underlying action wherein Province of British Columbia (British Columbia) seeking declaration that Province of Alberta’s (Alberta) Preserving Canada’s Economic Prosperity Act (Act) unconstitutional — Act empowering Minister to require licences for energy exports from Alberta, to impose terms, conditions on such exports, including quantity, destination — Comments made by members of Alberta legislature suggesting purpose of Act to inflict economic hardship on British Columbia — Minister not yet exercising powers conferred by Act — Defendant arguing plaintiff’s action not within jurisdiction of Court, premature — Also arguing, inter alia, Parliament never intending to allow Court to judge constitutional validity of provincial legislation — Reading in limitation to effect Court cannot issue declaratory judgment in exercise of its jurisdiction under Federal Courts Act , s. 19 — Arguing immunity from suit in Federal Court — Whether Court having jurisdiction over plaintiff’s action — Defendant could not claim immunity from jurisdiction of Court pursuant to Federal Courts Act , s. 19 — Constitutional issues not falling outside purview of s. 19 — S. 19 to be given wide

interpretation — Understood that “controversies” resolved by Court including controversies as to validity of legislation — Court’s s. 19 jurisdiction not constrained by Constitution Act, 1867, s. 101 — No obstacles to broad

interpretation of “controversies” submitted to Court pursuant to s. 19 — No reason to exclude challenges to validity of legislation from s. 19 ambit — By enacting, Judicature Act , s. 27 , adhering to Act, s. 19, defendant waiving Crown immunity by necessary implication — S. 19 contemplating suits against provincial governments — Concept of Crown immunity inimical to principle of supremacy of Constitution — Motion dismissed.

Constitutional Law — Distribution of Powers — Plaintiff seeking interlocutory injunction preventing Minister of Energy of Alberta (Minister) from exercising powers under Province of Alberta’s Preserving Canada’s Economic Prosperity Act (Act) — Plaintiff’s underlying action seeking declaration that Act unconstitutional — Act empowering Minister to require licences for energy exports from Alberta, to impose terms, conditions on such exports, including quantity, destination — Comments made by members of Alberta legislature suggesting purpose of Act to inflict economic hardship on British Columbia — Minister not yet exercising powers conferred by Act — Plaintiff arguing, inter alia, Act legislating interprovincial commerce not authorized by Constitution Act, 1867, s. 92A(2) — Alleging harm caused from disruption of its supply of petroleum products — Whether motion for interlocutory injunction should be granted — Plaintiff satisfying test set out in RJR — MacDonald Inc. v.

Canada (Attorney General) — Plaintiff raising serious issue that Act overstepping bounds of provincial jurisdiction — Act allowing Minister to issue licences containing certain export restrictions — Such legislation falling under Parliament’s jurisdiction over interprovincial commerce pursuant to s. 91(2) — Concepts of “authorizing”, “providing” in s. 92A(2) distinct — Act imposing form of discrimination on British Columbia — Seeking to limit exportation of petroleum products from Alberta to British Columbia — Alleged harm meeting test for interlocutory injunction — Embargo on oil, gas exports leading to increased prices, fuel shortages — Nature of harm suffered more important than its magnitude — Plaintiff seeking injunction before harm occurring having to establish high likelihood of harm — Presumption that Minister would exercise powers under Act in compliance with Constitution — However, no such thing as valid exercise of discretion pursuant to invalid legislation — No examples of valid exercise of discretion offered herein — Balance of convenience favouring British Columbia — Presumption legislation challenged enacted in public interest, will serve public interest — Here no information as to manner in which Act pursuing public interest — Presumption not dispensing defendant from explaining what that interest is — Defendant protecting Act with web of presumptions — Constitutional law concerned with substance, not form — In reality Act adopted to impose oil embargo on British Columbia — Failure to sustain constitutional validity of such measure leading to conclusion plaintiff having strong case — Motion for interlocutory injunction granted.

These were two motions. The first motion, by the defendant, sought to strike the plaintiff’s underlying action wherein the Province of British Columbia (British Columbia) sought a declaration that the Province of Alberta’s (Alberta) Preserving Canada’s Economic Prosperity Act (Act) was unconstitutional. The second motion, by the plaintiff, sought an interlocutory injunction preventing the Minister of Energy of Alberta (Minister) from exercising her powers under the Act. The Act empowers the Minister to require anyone who wishes to export natural gas, crude oil or refined fuels from Alberta to obtain a licence.

It also empowers the Minster to impose terms and conditions on such exports, including their quantity and destination. During

the debates in the Alberta legislature, members made statements suggesting that the purpose of the Act was to inflict economic hardshipon British Columbia because of that province’s opposition to the Trans Mountain expansion project. The Minister had not yet exercisedthe powers conferred by the Act and the Lieutenant Governor in Council did not make any regulations pursuant to the Act. The defendantargued that the plaintiff’s action was not within the jurisdiction of the Federal Court, and that it was premature.

The defendant argued,inter alia, that Parliament never intended to allow the Court to judge the constitutional validity of provincial legislation: Parliamentchose to ascribe jurisdiction over such challenges to the Supreme Court only. The defendant also tried to read in a limitation to the effectthat the Court could not issue a declaratory judgment, or at least a declaration of constitutional invalidity, in the exercise of itsjurisdiction under

section 19 of the Federal Courts Act. The defendant argued that it is immune from suit in the Federal Court, and that aprovince cannot challenge another province’s legislation. The plaintiff argued, inter alia, that the Act is legislation with respect to interprovincial commerce that is not authorized by subsection92A(2) of the Constitution Act, 1867. According to the plaintiff, the Act breached the requirements of that provision by “authoriz[ing] orprovid[ing] for discrimination … in supplies exported to another part of Canada”.

It alleged that it would be harmed from the disruptionof its supply of petroleum products. The main issues were whether the Court had jurisdiction over the plaintiff’s action, and whether the plaintiff’s motion for interlocutoryinjunction should be granted. Held, the defendant’s motion should be dismissed; the plaintiff’s motion should be granted. The defendant could not claim that it is “immune” from the jurisdiction of the Court pursuant to

section 19 of the Federal Courts Act. Areview of the legislative history of

section 19 did not show that constitutional issues fall outside the purview of that provision. To thecontrary, the context in which

section 19 was enacted tends to demonstrate that it should be given a wide

interpretation and that itsauthors understood that the “controversies” that the Court must resolve would include controversies as to the validity of legislation. TheCourt’s

section 19 jurisdiction is not constrained by

section 101 of the Constitution Act, 1867. The lack of any mention of declaratoryjudgments in

section 19, in contrast to

section 18 of the Federal Courts Act, is not conclusive. There are no obstacles to a broadinterpretation of the kinds of “controversies” that may be submitted to the Court pursuant to

section 19. There was no reason to excludechallenges to the validity of legislation from the ambit of

section 19 of the Federal Courts Act. The defendant’s adhesion to themechanism provided by

section 19 necessarily implies a waiver of Crown immunity. By enacting

section 27 of its Judicature Act, thedefendant waived Crown immunity by necessary implication. Moreover, Crown immunity would “wholly frustrate”

section 19, or renderit entirely inoperative.

Section 19 clearly contemplates suits against provincial governments and it was difficult to understand how thedefendant could claim immunity in the face of

section 27 of the Judicature Act. As it finds its source in statute or the common law, theconcept of Crown immunity is inimical to the principle of the supremacy of the Constitution. When the constitutional validity oflegislation is at stake, the legislature cannot immunize itself from review without undercutting the whole foundation of the constitutionaledifice. The fact that this was the first attempt to initiate such a challenge in this Court did not prove that it lacked jurisdiction. Canada’s constitutional structure did not deprive the plaintiff of the standing to bring its action.

Anyone can challenge the validity oflegislation that is sought to be applied against them. There is no reason why an Attorney General would not be able, in appropriatecircumstances, to challenge the validity of the legislation of another province, when everyone else can. Canada’s federal nature impliesthat there will be situations where a province will have an interest in another province’s actions, especially when the prohibition onextraterritorial legislation or other rules related to economic integration are at stake.

Challenging another province’s legislation is notnecessarily an affront to that other province’s “equal sovereignty”. The Court could not give effect to the defendant’s prematurity objection. The development of the doctrine of public interest standingrequires a more flexible approach to the issue of prematurity. Thus, declaratory judgments are available in circumstances where rightshave not been violated, but merely threatened.

Courts have been reluctant to issue a declaratory judgment before legislation is applied ina specific situation because such a situation provides a factual context that helps them understand the practical effects of the legislation.A factual background, however, is less necessary where the Charter is not in play, particularly in division-of-powers cases. Theplaintiff’s action did not challenge any measure taken pursuant to the Act. It challenged the Act itself. The main question was todetermine the Act’s pith and substance and this did not require evidence regarding the application of the Act.

Evidentiary difficultieswere not an obstacle in this case. The mere adoption of the Act was a threat that was sufficient to give rise to a “live controversy” of thekind contemplated by the Supreme Court in Daniels v. Canada (Indian Affairs and Northern Development). The plaintiff satisfied the test set out by the Supreme Court in RJR — MacDonald Inc. v.

Canada (Attorney General), (SCC), [1994] 1 S.C.R. 311, (1994), 111 D.L.R. (4th) 385, i.e. by demonstrating that that there was a serious question to be tried; that itwould suffer irreparable harm if its application was refused; and that the balance of convenience favoured granting the relief. The plaintiff raised a serious issue that the Act overstepped the bounds of provincial jurisdiction. A cursory review of the Act showedthat it was directed at the regulation of oil exports.

This kind of legislation falls under Parliament’s jurisdiction over interprovincialcommerce pursuant to subsection 91(2) of the Constitution Act, 1867. The concepts of “authorizing” and “providing” in subsection92A(2) are distinct. “Authorizing,” in its ordinary meaning, includes the delegation of a power that may be used so as to creatediscrimination. In this regard, the Act allows the Minister to issue licences that contain restrictions concerning the point of export fromAlberta.

A detailed review of the legislative debates showed that the whole point of the Act was to impose a form of discrimination onBritish Columbia. One could conclude that the Act sought to limit the exportation of petroleum products from Alberta, and theapplication of the Act was only ever contemplated in relation to British Columbia. The harm alleged by the plaintiff met the test for an interlocutory injunction. It was obvious that an embargo on exports to BritishColumbia would cause a considerable increase in the price of gasoline and diesel in that province.

Depending on the duration of theembargo, it would also lead to fuel shortages endangering public safety in various ways. These consequences are irreparable. It is of noconsequence that the precise manner in which the Act would be implemented is unknown and that it is difficult to predict the extent ofthe harm that an oil embargo would cause. What matters is “the nature of the harm suffered rather than its magnitude.” A plaintiff whois seeking an injunction before the harm occurs—a quia timet injunction—must establish that there is a high likelihood of harm.

Therewould be a presumption that, should the Minister ever exercise her powers under the Act, she would do so in a manner that complies with

the Constitution. In other words, as the occurrence of any harm remained speculative, the interlocutory injunction would be premature.However, there can be no such thing as a valid exercise of discretion pursuant to invalid legislation. The defendant did not offer anyexamples of what a valid exercise of discretion under the Act would be. In the circumstances of the present case, the idea that the Actcould be applied in a constitutionally valid manner lacked an air of reality. The uncertainty about whether or how the Act would beimplemented resulted entirely from the defendant’s conduct.

The defendant should not benefit from uncertainty it has itself created. Thecourts’ reluctance to issue quia timet injunctions is not meant to enable defendants to threaten harm and then to resist the issuance of aninjunction on the basis that the likelihood of their acting on their threats is unknown. When legislation is intended to cause a particularconsequence, it is no answer to say that the realization of that consequence is uncertain or that it depends on the exercise of discretionarypowers.

Accepting the defendant’s argument that the plaintiff’s application was premature would likely have shielded the operation ofthe Act from effective review. The irreparable harm that British Columbia would suffer if the injunction was not granted far outweighed any inconvenience that theinjunction might impose on Alberta. When assessing the balance of convenience, courts must presume that the legislation challengedwas enacted in the public interest and will serve the public interest.

The application of that presumption in the present case raised afundamental problem in that there was no information as to the manner in which the Act pursues a public interest. The presumption ofpublic interest did not dispense the defendant from explaining what that interest is. The defendant chose not to answer the plaintiff’smain point that the Act is invalid as a whole because the oil embargo it is meant to implement is a measure in respect of interprovincialcommerce that is not authorized by subsection 92A(2). The defendant sought to protect the Act by a web of presumptions.

Butpresumptions are what they are—legal fictions. Constitutional law is concerned with the substance and not the form—the reality and notthe legal fiction. The reality is that the Act was adopted to empower the Alberta government to impose an oil embargo on BritishColumbia. The defendant did not reveal an argument to sustain the constitutional validity of such a measure. This failure led the Court tothe conclusion that the plaintiff had a strong case. STATUTES AND REGULATIONS CITED Bill 12: Preserving Canada’s Economic Prosperity Act, 29th Leg., 4th Sess., Alberta, 2018.

Canadian Charter of Rights and Freedoms, being

Part I of the Constitution Act, 1982,

Schedule B, Canada Act 1982, 1982, c. 11 (U.K.)[R.S.C., 1985, Appendix II, No. 44], s. 1. Colonial Laws Validity Act, 1865 (U.K.), 28 & 29 Vict., c. 63. Constitution Act, 1867, 30 & 31 Vict., c. 3 (U.K.) (as am. by Canada Act 1982, 1982, c. 11 (U.K.),

Schedule to the Constitution Act,1982, Item 1) [R.S.C., 1985, Appendix II, No. 5], ss. 91–95, 91(2), 92(5),(14), 92A, 101, 109, 121, Sixth Schedule. Constitution Act, 1930, 20 & 21 Geo. V, c. 26 (U.K.) (as am. by Canada Act 1982, 1982, c. 11 (U.K.),

Schedule to the Constitution Act,1982, Item 16) [R.S.C., 1985, Appendix II, No. 26]. Copyright Act, R.S.C., 1985, c. C-42. Curtailment Rules, Alta. Reg. 214/2018. Federal Courts Act, R.S.C., 1985, c. F-7, ss. 2 “Crown”, “federal board, commission or other tribunal”, 17, 18, 19, 20. Federal Courts Jurisdiction Act, R.S.B.C. 1996, c. 135, s. 1. Federal Courts Rules, SOR/98-106, r. 221. Gas Resources Preservation Act, R.S.A. 2000, c. G-4.

Interpretation Act, R.S.C., 1985, c. I-21, s. 17. Judicature Act, R.S.A. 2000, c. J-2, ss. 25, 27. Oil and Gas Conservation Act, R.S.A. 2000, c. O-6. Oil Sands Conservation Act, R.S.A. 2000, c. O-7. Patent Act, R.S.C., 1985, c. P-4. s. 2.1. Preserving Canada’s Economic Prosperity Act, S.A. 2018, c. P-21.5,

Preamble, ss. 2, 4, 7, 10, 11, 14. Responsible Energy Development Act, S.A. 2012, c. R-17.3. Supreme and Exchequer Court Act (The), S.C. 1875, c. 11, ss. 54, 55, 56. United States Constitution,

Article III. CASES CITED APPLIED: R. v. Imperial Tobacco Ltd., 2011 SCC 42, [2011] 3 S.C.R. 45; Alberta v. Canada, 2018 FCA 83, 425 D.L.R. (4th) 366; Apotex Inc. v.Ambrose, 2017 FC 48, [2017] 4 F.C.R. 510; Windsor (City) v. Canadian Transit Co., 2016 SCC 54, [2016] 2 S.C.R. 617; Canada(Human Rights Commission) v. Canadian Liberty Net, (SCC), [1998] 1 S.C.R. 626; The Queen (Canada) v. The Queen

(P.E.I.), (FCA), [1978] 1 F.C. 533, (1977), 14 Nfld. & P.E.I.R. 477 (C.A.); Alberta Government Telephones v.Canada (Canadian Radio-television and Telecommunications Commission), (SCC), [1989] 2 S.C.R. 225, (1989), 61D.L.R. (4th) 193; Daniels v. Canada (Indian Affairs and Northern Development), 2016 SCC 12, [2016] 1 S.C.R. 99; R. v. Morgentaler, (SCC), [1993] 3 S.C.R. 463, (1993), 107 D.L.R. (4th) 537; RJR — MacDonald Inc. v. Canada (Attorney General), (SCC), [1994] 1 S.C.R. 311, (1994), 111 D.L.R. (4th) 385; Canada (Attorney General) v. Oshkosh Defense Canada Inc.,2018 FCA 102.

CONSIDERED: British Columbia (Attorney General) v. Alberta (Attorney General), 2019 ABQB 550 ; Attorney-General of Ontario v. Attorney-General of Canada (1907), (SCC), 39 S.C.R. 14; Province of Ontario v. Dominion of Canada (1909), (SCC), 42 S.C.R. 1, affd [1910] A.C. 637 (P.C.); Canadian Council of Churches v. Canada (Minister of Employment and Immigration), (SCC), [1992] 1 S.C.R. 236, (1992), 2 Admin. L.R. (2d) 229; Reference re Secession of Quebec, (SCC), [1998] 2 S.C.R. 217, (1998), 161 D.L.R. (4th) 385; British Columbia Power Corporation v.

British Columbia Electric Company, (SCC), [1962] S.C.R. 642, (1962), 34 D.L.R. (2d) 196; Amax Potash Ltd. Etc. v. The Government of Saskatchewan, (SCC), [1977] 2 S.C.R. 576, (1976), 71 D.L.R. (3d) 1; Air Canada v. British Columbia (Attorney General), (SCC), [1986] 2 S.C.R. 539, (1986), 32 D.L.R. (4th) 1; Reference re Upper Churchill Water Rights Reversion Act, (SCC), [1984] 1 S.C.R. 297, (1984), 47 Nfld. & P.E.I.R. 125; Hunt v. T&N plc, (SCC), [1993] 4 S.C.R. 289, (1993), 109D.L.R. (4th) 16; R. in right of Newfoundland v.

Commission Hydro-Electrique de Québec, (SCC), [1982] 2 S.C.R. 79,(1982), 137 D.L.R. (3d) 577; Manitoba Metis Federation Inc. v. Canada (Attorney General), 2013 SCC 14, [2013] 1 S.C.R. 623;Manitoba (Attorney General) v. Metropolitan Stores Ltd., (SCC), [1987] 1 S.C.R. 110, (1987), 38 D.L.R. (4th) 321; PTv. Alberta, 2019 ABCA 158 ; Mosaic Potash Esterhazy Limited Partnership v. Potash Corporation of Saskatchewan Inc., 2011SKCA 120 , 341 D.L.R. (4th) 407; Goodwin v.

British Columbia (Superintendent of Motor Vehicles), 2015 SCC 46, [2015] 3S.C.R. 250; Reference re Secession of Quebec, [1998] 2 S.C.R. 217, (1998), 161 D.L.R. (4th) 385; Morguard Investments Ltd. v. DeSavoye, (SCC), [1990] 3 S.C.R. 1077, (1990), 76 D.L.R. (4th) 256; R. v. Comeau, 2018 SCC 15, [2018] 1 S.C.R. 342;Guimond v. Quebec (Attorney General), (SCC), [1996] 3 S.C.R. 347, (1996), 138 D.L.R. (4th) 647; Mackin v. NewBrunswick (Minister of Finance); Rice v. New Brunswick, 2002 SCC 13, [2002] 1 S.C.R. 405; RWDSU v.

Dolphin Delivery Ltd., (SCC), [1986] 2 S.C.R. 573, (1986), 33 D.L.R. (4th) 174; Reference re Senate Reform, 2014 SCC 32, [2014] 1 S.C.R. 704. REFERRED TO: British Columbia (Attorney General) v. Alberta (Attorney General), 2019 ABQB 121 ; Quebec North Shore Paper v. C.P. Ltd., (SCC), [1977] 2 S.C.R. 1054, (1976), 71 D.L.R. (3d) 111; ITO-Int’l Terminal Operators v. Miida Electronics, (SCC), [1986] 1 S.C.R. 752, (1986), 28 D.L.R. (4th) 641; Fédération des producteurs de volailles du Québec v.

Pelland, 2005SCC 20, [2005] 1 S.C.R. 292; Reference re Pan-Canadian Securities Regulation, 2018 SCC 48, [2018] 3 S.C.R. 189; A.G. Can. v. LawSociety of B.C., (SCC), [1982] 2 S.C.R. 307, (1982), 137 D.L.R. (3d) 1; Washington State Grange v. Washington StateRepublican Party, 552 U.S. 442 (2008); Rescue Army v. Municipal Court of Los Angeles, 331 U.S. 549 (1947); Canada (AttorneyGeneral) v. Bedford, 2013 SCC 72, [2013] 3 S.C.R. 1101; Carter v. Canada (Attorney General), 2015 SCC 5, [2015] 1 S.C.R. 331;Bilodeau-Massé v. Canada (Attorney General), 2017 FC 604, [2018] 1 F.C.R. 386; Deegan v.

Canada (Attorney General), 2019 FC 960,[2020] 1 F.C.R. 411; Canada (Attorney General) v. Thouin, 2017 SCC 46, [2017] 2 S.C.R. 184; Pasqua First Nation v. Canada(Attorney General), 2016 FCA 133, [2017] 3 F.C.R. 3; Greely v. “Tami Joan” (The) (1996), 113 F.T.R. 66 (F.C.T.D.); Bessette v.Quebec (Attorney General), 2019 FC 393; Trainor Surveys

(1974) Limited v. New Brunswick (T.D.), (FC), [1990] 2F.C. 168(T.D.); R. v. Big M Drug Mart Ltd., (SCC), [1985] 1 S.C.R. 295, (1986), (SCC), 32 D.L.R. (4th)1; Canada (Attorney General) v. Downtown Eastside Sex Workers United Against Violence Society, 2012 SCC 45, [2012] 2 S.C.R. 524;1068754 Alberta Ltd. v. Québec (Agence du revenu), 2019 SCC 37; Attorney-General for Manitoba v. Manitoba Egg and PoultryAssociation et al., (SCC), [1971] S.C.R. 689, (1970), 19 D.L.R. (3d) 169; Operation Dismantle v. The Queen, (SCC), [1985] 1 S.C.R. 441, (1985), 18 D.L.R. (4th) 481; RJR-MacDonald Inc. v.

Canada (Attorney General), (SCC), [1995] 3 S.C.R. 199, (1995), 127 D.L.R. (4th) 1; Libman v. Quebec (Attorney General), (SCC), [1997] 3S.C.R. 569, (1997), 151 D.L.R. (4th) 385; Canadian Broadcasting Corp. v. Canada (Attorney General), 2011 SCC 2, [2011] 1 S.C.R.19; B.C. Freedom of Information and Privacy Association v. British Columbia (Attorney General), 2017 SCC 6, [2017] 1 S.C.R. 93; Att.Gen. of Quebec v. Blaikie et al., (SCC), [1979] 2 S.C.R. 1016, (1979), 101 D.L.R. (3d) 394; Potter c. Québec(Procureur général du), , [2001] R.J.Q. 2823 (C.A.); British Columbia v.

Imperial Tobacco Canada Ltd., 2005 SCC49, [2005] 2 S.C.R. 474; British Columbia (Attorney General) v. Christie, 2007 SCC 21, [2007] 1 S.C.R. 873; Canadian Western Bank v.Alberta, 2007 SCC 22, [2007] 2 S.C.R. 3; Harper v. Canada (Attorney General), 2000 SCC 57, [2000] 2 S.C.R. 764; R. v. CanadianBroadcasting Corp., 2018 SCC 5, [2018] 1 S.C.R. 196; Kitkatla Band v.

British Columbia (Minister of Small Business, Tourism andCulture), 2002 SCC 31, [2002] 2 S.C.R. 146; Reference re Assisted Human Reproduction Act, 2010 SCC 61, [2010] 3 S.C.R. 457;Reference re Securities Act, 2011 SCC 66, [2011] 3 S.C.R. 837; Central Canada Potash Co. Ltd. et al. v. Government of Saskatchewan, (SCC), [1979] 1 S.C.R. 42, (1978), 88 D.L.R. (3d) 609; Rogers Communications Inc. v. Châteauguay (City), 2016 SCC23, [2016] 1 S.C.R. 467; Reference re Environmental Management Act (British Columbia), 2019 BCCA 181, 434 D.L.R. (4th) 213;Reference re Validity of

Section 5 (

a) Dairy Industry Act, (SCC), [1949] S.C.R. 1, [1949] 1 D.L.R. 433; Quebec (AttorneyGeneral) v. Canada (Attorney General), 2015 SCC 14, [2015] 1 S.C.R. 693; Lawson v. Interior Tree Fruit and Vegetables Committee ofDirection, (SCC), [1931] S.C.R. 357, [1931] 2 D.L.R. 193; Texada Mines Ltd. v. Attorney-General of British Columbia, (SCC), [1960] S.C.R. 713, (1960), 24 D.L.R. (2d) 81; Canadian Industrial Gas & Oil Ltd. v. Government ofSaskatchewan et al., (SCC), [1978] 2 S.C.R. 545, (1977), 80 D.L.R. (3d) 449; General Motors of Canada Ltd. v.

CityNational Leasing, (SCC), [1989] 1 S.C.R. 641, (1989), 58 D.L.R. (4th) 255; Holland America Cruises v. Gralewicz,, 60 D.L.R. (3d) 512 (B.C.S.C.); Alberta Union of Provincial Employees v. Alberta, 2019 ABCA 320 , 438D.L.R. (4th) 465; Law Society of British Columbia v. Canada (Attorney General), 2001 BCSC 1593, 207 D.L.R. (4th) 705; Québec(Procureur général) c. Canada (Procureur général), 2012 QCCS 1614, [2012] R.J.Q. 833; Alberta Union of Provincial Employees v.Alberta, 2014 ABQB 97 , 585 A.R. 202; Tłı̨ chǫ Government v.

Canada (Attorney General), 2015 NWTSC 9 , [2015] 2C.N.L.R. 372; National Council of Canadian Muslims (NCCM) v. Attorney General of Québec, 2018 QCCS 2766 ; Toronto(City) v. Ontario (Attorney General), 2018 ONCA 761 , 142 O.R. (3d) 481; Doucet-Boudreau v. Nova Scotia (Minister ofEducation), 2003 SCC 62, [2003] 3 S.C.R. 3.

AUTHORS CITED Alberta Hansard , 29th Leg., 4th Sess., April 9, 2018. Alberta Hansard , 29th Leg., 4th Sess., May 7, 2018. Alberta Hansard , 29th Leg., 4th Sess., May 16, 2018. British Columbia Utilities Commission. Inquiry into Gasoline and Diesel Prices in British Columbia: Final Report , August 30, 2019. Favoreu, Louis. Droit constitutionnel , 21st ed. Paris: Dalloz, 2019. Huffman, James L. and MardiLyn Saathoff. “Advisory Opinions and Canadian Constitutional Development: The Supreme Court’s Reference Jurisdiction” (1990), 74 Minn. L. Rev. 1251.

Kenney, Jason. “Premier Jason Kenney to British Columbians: ‘We will never be afraid to stand up for Alberta’”, Vancouver Sun (May 1, 2019), online: <https://vancouversun.com/opinion/op-ed/premier-jason-kenney-we-will-never-be-afraid-to-stand-up-for-alberta/>. Kokott, Juliane and Martin Kaspar. “Ensuring Constitutional Efficacy” in Michel Rosenfeld and András Sajó, eds., The Oxford Handbook of Comparative Constitutional Law . Great Britain: Oxford University Press, 2012. Meekison Peter J., Roy J. Romanow and William D. Moull, Origins and Meaning of

Section 92A: the 1982 constitutional amendment on resources . Montreal: Institute for Research on Public Policy, 1985. Newman, Dwight. Natural Resource Jurisdiction in Canada. Markham, Ont.: LexisNexis, 2013. Russell, Peter H. “The Jurisdiction of the Supreme Court of Canada: Present Policies and a Programme for Reform” (1968), 6 Osgoode Hall L.J. 1. Sharpe, Robert J. Injunctions and Specific Performance , loose-leaf ed. Toronto: LexisNexis, 2012. Strayer, Barry L. The Canadian Constitution and the Courts: the function and scope of judicial review , 3rd ed. Toronto: Butterworths, 1988.

MOTIONS by the defendant seeking to strike the plaintiff’s underlying action wherein it sought a declaration that the Province of Alberta’s Preserving Canada’s Economic Prosperity Act (Act) was unconstitutional, and by the plaintiff seeking an interlocutory injunction preventing the Minister of Energy of Alberta from exercising her powers under the Act. Motion by defendant dismissed; motion by plaintiff granted. APPEARANCES J. Gareth Morley and Robert Danay for plaintiff. Evan W. Dixon , Paul G. Chiswell and Mark MacAulay for defendant.

SOLICITORS OF RECORD Ministry of the Attorney General, Legal Services Branch , Vancouver, for plaintiff. Burnet, Duckworth and Palmer LLP , Calgary, for defendant. The following are the reasons for order and order rendered in English by Grammon J. : Table of Contents Paragraph I. Background 8 A. Genesis of the Act 9 B. Contents of the Act 12 C. Proceedings in Alberta 16 D. Proceedings in this Court 20 II. Alberta’s Motion to Strike 22

A. Applicable Test 24 B. Jurisdiction 25

(1) Legislative History and Purpose of

Section 19 32

(2) Wording and Implied Limitations 50

(3) Crown Immunity 61 C. Standing 73 D. Prematurity 82 III. British Columbia’s Motion for an Interlocutory Injunction 93 A. Analytical Framework 93 B. Serious Issue to be Tried 98

(1) The Process for Classifying Laws 100

(2) Interprovincial Commerce, Natural Resources and the Division of Powers 105

(3) Analysis 113 C. Irreparable Harm 133

(1) Principles and Burden of Proof 135

(2) The Evidence 137

(3) Analysis 146 D. Balance of Convenience 160

(1) Public Interest 162

(2) Inconvenience for the Defendant 167

(3) Strength of Plaintiff’s Case 173

(4) Summary 180 E. Terms of Injunction 182 IV. Disposition and Costs 187 [ 1 ] Alberta has adopted the Preserving Canada’s Economic Prosperity Act , S.A. 2018, c. P-21.5 (the Act ). This Act empowers the Minister of Energy of Alberta (the Minister) to require anyone who wishes to export natural gas, crude oil or refined fuels from Alberta to obtain a licence and to impose terms and conditions on such exports, including their quantity and destination.

One of the factors that the Minister must consider before imposing such requirements is “whether adequate pipeline capacity exists to maximize the return on crude oil and diluted bitumen produced in Alberta.” [ 2 ] British Columbia seeks a declaration that the Act is unconstitutional. It initially brought its action before the Alberta Court of Queen’s Bench, which stayed the action on the basis that the Federal Court would have jurisdiction over it. British Columbia then brought an action in this Court.

It argues that the Act regulates interprovincial commerce, which is an area of exclusive federal jurisdiction, and that it is not saved by the exceptions contained in

section 92A of the Constitution Act, 1867 . Moreover, it asserts that the Act contravenes the prohibition of interprovincial customs duties in

section 121 of the Constitution Act, 1867 .

According to British Columbia, the only purpose of the Act is to allow Alberta to cut British Columbia’s main source of petroleum products, in retaliation for its perceived opposition to the Trans Mountain pipeline expansion project. [ 3 ] These reasons deal with two motions brought in the course of the action. [ 4 ] First, Alberta brought a motion to strike British Columbia’s action on the basis that it is not within the jurisdiction of the Federal Court and that it is premature. [ 5 ] Second, British Columbia brought a motion for an interlocutory injunction preventing the Minister from exercising her powers under the Act .

In the alternative, it seeks an interlocutory injunction that would require the Minister to give 42 days’ notice before exercising those powers. [ 6 ] I am dismissing Alberta’s motion to strike. Pursuant to

section 19 of the Federal Courts Act , R.S.C., 1985, c. F-7 , this Court has optional jurisdiction over interprovincial disputes. By legislation, the two provinces involved have opted into that jurisdiction. Alberta

did not show any convincing reason why this jurisdiction would not encompass disputes regarding the constitutional validity of provincial legislation. Moreover, it is not premature to bring the matter before the Court at this time, as British Columbia challenges the Act itself and not any specific measure taken pursuant to the Act . [ 7 ] I am allowing British Columbia’s motion for interlocutory injunction. British Columbia has met the criteria usually applied by the courts for the issuance of such an injunction. It has shown that the validity of the Act raises a serious issue.

It has demonstrated that an embargo of the nature evoked by the members of Alberta’s legislature when debating the Act would cause irreparable harm to the residents of British Columbia. I am rejecting Alberta’s argument that this harm is speculative, because it is reasonably certain and its triggering lies entirely within Alberta’s discretion. Lastly, British Columbia has shown that the balance of convenience is in its favour, given the strength of its case and the lack of any clear and identifiable negative consequences for Alberta if the injunction is granted. I.

Background [ 8 ] To place the issues raised by these two motions in their proper context, I must first describe the circumstances that gave rise to the adoption of the Act and provide a

summary of what the Act purports to accomplish. I will then outline the steps that British Columbia has taken in the Alberta Court of Queen’s Bench and in this Court to challenge the Act . A. Genesis of the Act [ 9 ] The Trans Mountain pipeline was built in the 1950s and links Edmonton, Alberta, with Burnaby, British Columbia. It is the main pipeline by which petroleum products are carried from Alberta to British Columbia. The pipeline’s owner, Kinder Morgan Canada Ltd. (Kinder Morgan), has proposed to expand its capacity by building an additional line along the original line.

That project, known as the Trans Mountain expansion, or TMX, has sparked vigorous public debate and has given rise to a number of legal proceedings. It is not necessary to give a full account of those debates and proceedings here. It is sufficient to highlight the event that precipitated the adoption of the Act : Kinder Morgan’s decision, announced on April 8, 2018, to suspend all non-essential work on the Trans Mountain expansion project. [ 10 ] The following day, in the Alberta legislature, the Minister of Energy indicated that the government would soon introduce legislation regarding that situation.

Bill 12 [Preserving Canada’s Economic Prosperity Act, 29th Leg. 4th Sess., 2018], which became the Act , was then tabled on April 16, 2018. During the debates in the legislature, members of both main political parties made statements suggesting that the purpose of the Act is to inflict economic hardship on British Columbia because of its opposition to the Trans Mountain expansion project. I will review these statements in more detail later in these reasons. [ 11 ] The Act was adopted and received royal assent on May 18, 2018.

It was proclaimed into force roughly a year later, on April 30, 2019, after a new government took office. B. Contents of the Act [ 12 ] The Act ’s central provision is

section 2, which empowers the Minister to require exporters of petroleum products to obtain a licence. It is worded as follows: Licence requirement 2(1) No person shall, without a licence, export from Alberta any quantity of natural gas, crude oil or refined fuels. (2) Subsection (1) applies only where the Minister by order requires a person or class of persons to obtain a licence.

(3) Before making an order under subsection (2), the Minister shall determine whether it is in the public interest of Alberta to do so having regard to (

a) whether adequate pipeline capacity exists to maximize the return on crude oil and diluted bitumen produced in Alberta, (

b) whether adequate supplies and reserves of natural gas, crude oil and refined fuels will be available for Alberta’s present and future needs, and (

c) any other matters considered relevant by the Minister. [ 13 ]

Section 4 empowers the Minister of Energy to set the terms and conditions of export licences, including “the point at which the licensee may export from Alberta any quantity of natural gas, crude oil or refined fuels”, as well as restrictions on maximum quantities and methods of exportation.

Section 7 makes it an offence to breach the provisions of the Act or the terms of a licence. An individual offender is liable to a daily fine of up to $1 000 000, and a corporate offender is liable to a daily fine of up to $10 000

Section 10 provides immunity from suit for the Minister, the Crown or Crown employees for actions done pursuant to the Act .

Section 11 empowers the Lieutenant Governor in Council to make regulations respecting a number of subjects, including applications for a licence and the terms and conditions of licences. [ 14 ] The Act is also subject to a two-year “sunset clause”: pursuant to

section 14 , the Act is repealed two years after it is proclaimed into force. The Legislative Assembly, however, may extend that period by resolution. [ 15 ] To this day, the Minister of Energy has not exercised the powers conferred by the Act and the Lieutenant Governor in Council has not made any regulations pursuant to the Act . C. Proceedings in Alberta [ 16 ] A few days after the Act was given royal assent, British Columbia commenced an action before the Alberta Court of Queen’s Bench for a declaration that the Act is unconstitutional. That action was dismissed for prematurity, as the Act had not yet been

proclaimed into force: British Columbia (Attorney General) v. Alberta (Attorney General), 2019 ABQB 121 . [17] On May 1, 2019, the day after the Act was proclaimed into force, British Columbia brought a new action before the AlbertaCourt of Queen’s Bench. It also sought an interlocutory injunction. Alberta, for its part, sought to have the action dismissed on the basisthat British Columbia lacked standing. [18] On July 19, 2019, Justice Hall of the Alberta Court of Queen’s Bench allowed Alberta’s motion in part and stayed BritishColumbia’s action: British Columbia (Attorney General) v. Alberta (Attorney General), 2019 ABQB 550 . Justice Hall held thatunder

section 25 of Alberta’s Judicature Act, R.S.A. 2000, c. J-2, only the Attorneys General of Canada and Alberta have standing toseek a declaration of unconstitutionality before the Alberta courts. He went on to consider whether the Federal Court would havejurisdiction over the matter pursuant to

section 19 of the Federal Courts Act and concluded as follows, at paragraphs 43–44: While I have accepted the AGAB’s argument that only the AGCanada and the AGAB have standing to seek a declaration ofconstitutional invalidity of Alberta legislation in the Alberta courts, absent a claim for any other relief, this conclusion does not leave theAGBC without recourse and it does not immunize the AGAB from a constitutional challenge to the Act.

The above discussion suggests that Parliament and the provincial legislatures have enacted the requisite legislation to give the FederalCourt jurisdiction in interprovincial disputes of this nature, which further suggests the AGBC has standing to bring its action before thatcourt…. [19] I am informed that no appeal was taken of Justice Hall’s order. D. Proceedings in this Court [20] On June 14, 2019, British Columbia filed the present action. I understand that the statement of claim is substantially similar tothe one filed in the Alberta Court of Queen’s Bench.

By order of my colleague Justice Alan Diner, the action was put in abeyance whilethe Alberta Court of Queen’s Bench was considering Alberta’s motion to dismiss. [21] On August 14, 2019, at the request of both parties, my colleague Prothonotary Kathleen Ring ordered that the case be speciallymanaged and, on August 15, the Chief Justice designated me as the case management judge. I ordered that the case no longer be held inabeyance. British Columbia then filed its motion for an interlocutory injunction and Alberta, its motion to strike, and I set a timetableleading to the hearing of those two motions.

It was agreed that the evidence in support of British Columbia’s motion would be the sameas filed in support of a similar motion before the Alberta Court of Queen’s Bench. II. Alberta’s Motion to Strike [22] Alberta asks that British Columbia’s action be struck on two grounds: it is not within the jurisdiction of the Federal Court, and itis premature.

I am dismissing Alberta’s motion to strike, because Alberta failed to identify any grounds to negate this Court’s jurisdictionand because the matter is ripe for judicial decision. [23] In the following pages, after explaining the test that guides the Court on a motion to strike, I will analyse Alberta’s argumentswith respect to jurisdiction and prematurity. As I consider that some of Alberta’s arguments are better described as a challenge to BritishColumbia’s standing to pursue this action, I will address them as such in a separate section. A.

Applicable Test [24] Rule 221 of the Federal Courts Rules, SOR/98-106, provides that, on motion, the Court may strike out a pleading, such asBritish Columbia’s statement of claim, if that pleading “discloses no reasonable cause of action” or “is otherwise an abuse of the processof the Court”. In R. v. Imperial Tobacco Ltd., 2011 SCC 42, [2011] 3 S.C.R. 45, at paragraph 17, the Supreme Court of Canada describedas follows the test to be applied to a motion to strike: ….

A claim will only be struck if it is plain and obvious, assuming the facts pleaded to be true, that the pleading discloses no reasonablecause of action …. Another way of putting the test is that the claim has no reasonable prospect of success. Where a reasonable prospectof success exists, the matter should be allowed to proceed to trial …. B. Jurisdiction [25] A motion to strike may be grounded in the Court’s lack of jurisdiction. Nevertheless, the test remains the same: the action will bestruck only if it is plain and obvious that the Court does not have jurisdiction: Alberta v.

Canada, 2018 FCA 83, 425 D.L.R. (4th) 366(Alberta v. Canada), at paragraph 20; Apotex Inc. v. Ambrose, 2017 FC 487, [2017] 4 F.C.R. 510, at paragraphs 36–39; Windsor (City) v.Canadian Transit Co., 2016 SCC 54, [2016] 2 S.C.R. 617 (Windsor), at paragraph 24. [26] Given that the jurisdictional issue was fully argued and that it does not turn on any findings of fact, I am in a position to decide it.I find that this Court has jurisdiction over British Columbia’s action. [27] British Columbia grounds this Court’s jurisdiction to hear its action in

section 19 of the Federal Courts Act and parallelprovincial statutes.

Section 19 reads as follows: Intergovernmental disputes 19 If the legislature of a province has passed

an Act agreeing that the Federal Court, the Federal Court of Canada or the Exchequer Courtof Canada has jurisdiction in cases of controversies between Canada and that province, or between that province and any other provinceor provinces that have passed a like Act, the Federal Court has jurisdiction to determine the controversies. [28] Most Canadian provinces have enacted legislation accepting this Court’s jurisdiction in such matters. British Columbia’s Federal

Courts Jurisdiction Act, R.S.B.C. 1996, c. 135,

section 1, recognizes this Court’s jurisdiction over “controversies between BritishColumbia and any other province of Canada that has passed

an Act similar to this Act”.

Section 27 of Alberta’s Judicature Act does thesame, with respect to “controversies between Alberta and any other province or territory of Canada in which

an Act similar to this Act isin force”. [29] The concept common to the three relevant statutes is that, in English, of “controversy” and, in French, of “litige”. One could beforgiven for thinking that there is obviously a “controversy” or “litige” between British Columbia and Alberta regarding theconstitutional validity of the Act. Nevertheless, words in legislation should not be read in isolation and they sometimes take on atechnical meaning. Thus, relying on the historical evolution of what became

section 19 of the Federal Courts Act and authorities thathave interpreted its language or similar phrases, Alberta argues that Parliament never intended to allow this Court to judge theconstitutional validity of provincial legislation. [30] I underscore that Alberta’s challenge is not based on constitutional grounds. Alberta does not assert that the declaration sought byBritish Columbia exceeds the bounds of

section 101 of the Constitution Act, 1867, as delineated in cases such as Quebec North ShorePaper v. C.P. Ltd., (SCC), [1977] 2 S.C.R. 1054, and ITO-Int’l Terminal Operators v. Miida Electronics, (SCC), [1986] 1 S.C.R. 752. Indeed, when this Court exercises jurisdiction over interprovincial disputes pursuant to

section 19 of theFederal Courts Act and corresponding provincial legislation, the constitutional source of its jurisdiction is found not only, and perhapsnot mainly, in

section 101, but also in subsection 92(14), which grants provinces jurisdiction over the administration of justice: Alberta v.Canada, at paragraph 34. This is an example of cooperative federalism that the courts have been loath to overturn: Fédération desproducteurs de volailles du Québec v. Pelland, 2005 SCC 20, [2005] 1 S.C.R. 292, at paragraph 38; Reference re Pan-CanadianSecurities Regulation, 2018 SCC 48, [2018] 3 S.C.R. 189 (Second Securities Reference), at paragraph 18. [31] Thus, Alberta’s challenge to this Court’s jurisdiction involves essentially an exercise in statutory

interpretation. I will thus haveresort to the usual methods of

interpretation, namely, reviewing the wording, context and purpose of the relevant provision. Contextincludes other provisions of the same statute, other legislation and general constitutional principles. Purpose may be gleaned from ananalysis of the statute itself as well as the circumstances in which it was enacted. I will also heed the Supreme Court of Canada’s advicethat legislation granting jurisdiction to the Federal Court must be given a generous and liberal, rather than a narrow,

interpretation:Canada (Human Rights Commission) v. Canadian Liberty Net, (SCC), [1998] 1 S.C.R. 626, at paragraph 34.

(1) Legislative History and Purpose of

Section 19 [32] I will begin with a review of the circumstances that led to the enactment of what became

section 19 of the Federal Courts Act.Not only will this elucidate the purpose of that provision; it will also dispose of Alberta’s main argument—that Parliament specificallyconsidered the issue of challenges to the validity of provincial legislation and chose to ascribe jurisdiction over such challenges to theSupreme Court only and not to the Exchequer Court, the ancestor of today’s Federal Court. [33] At Confederation the idea of judicial review was well understood. Colonial legislatures and governments exercised limitedpower.

Courts had the power to strike down colonial legislation that contradicted Imperial legislation, as was made clear by the ColonialLaws Validity Act, 1865 [(U.K.), 28 & 29 Vict., c. 63]. Barry L.

Strayer summarizes the situation as follows, in The CanadianConstitution and the Courts: the function and scope of judicial review, 3rd ed. (Toronto: Butterworths, 1988) (Strayer, Constitution), atpage 14: We can thus see that, as Confederation approached, the judges and lawyers in the colonies of British North America must have beenfamiliar to some degree with the British doctrine of judicial review of colonial legislation.

Courts in other colonies had exercised thisfunction, some British North American courts had at least exercised an analogous function, and the English courts had not hesitated todeal with colonial legislative validity where it was relevant to their proceedings. The Judicial Committee, as the supreme judicial body ofthe colonial system, had provided ample precedents for judicial review. Its practice would have led the colonial courts to consider thequestion of validity where necessary, in anticipation of that issue being dealt with in London on appeal. [34] One feature of that form of review must be underlined.

Every judge in the country, whatever the level of court, is empowered toreview the constitutional validity of legislation. Today, comparative constitutional lawyers call this “diffuse” or “decentralized” judicialreview, as the mandate of applying the constitution is not entrusted to a single, specialized court.

Using the example of the United States,Professor Favoreu and his colleagues describe the concept as follows in Droit constitutionnel, 21st ed. (Paris: Dalloz, 2019) (Favoreu,Droit constitutionnel), at page 257: [translation] Applied to the American system, characterizing judicial review as “diffuse” means that any federal or State judge mayreview legislation on constitutional grounds … the judge seized of the matter in the first instance has jurisdiction to decide all the issuesarising in a case, whether they be civil, criminal, administrative or constitutional. [35] While the concept of judicial review was well known, the structure of the judicial institutions that would enforce the federaldivision of powers established by the new constitution was very much a matter of debate.

Non-judicial means, such as the federalcabinet’s disallowance power or arbitration (see, in this regard, Alberta v. Canada, at paragraph 31), were used for some time.Nevertheless, the Fathers of Confederation foresaw that the courts would play a major role, although they disagreed as to whether theJudicial Committee of the Privy Council in London or a Canadian general court of appeal should be entrusted with the finaldetermination of disputes regarding the division of powers: Strayer, Constitution, at pages 15–22.

Moreover, there were many conceptualobstacles to the judicial resolution of disputes involving governments, including Crown immunity and the concept of the indivisibility ofthe Crown. [36] In 1875, a significant step in adapting the judiciary to the new federal structure was taken with the enactment of The Supremeand Exchequer Court Act, S.C. 1875, c. 11.

Relevant to this discussion are the means provided by Parliament for the resolution ofintergovernmental disputes, including disputes as to the validity of legislation, which in that era would mostly be related to the divisionof powers. [37] The first means was the federal government’s reference power. Instead of waiting for a case to wind its way through the various

levels of courts, the government could refer a question directly to the Supreme Court, in particular when the validity of legislation was atstake. This power has been used repeatedly ever since. A significant proportion of our constitutional law now stems from advisoryopinions issued by the Supreme Court in reference cases. [38] Two other means were also provided.

As Alberta relies strongly on the wording of the relevant provision of The Supreme andExchequer Court Act, it is useful to set it out in full here, and to separate its various components for ease of reading: Powers to be exercised with consent of Local Legislatures. 54. When the Legislature of any Province forming part of Canada shall have passed

an Act agreeing and providing that the SupremeCourt, and the Exchequer Court, or the Supreme Court alone, as the case may be, shall have jurisdiction in any of the following cases,viz. :—(1st) Of controversies between the Dominion of Canada and such Province ; (2nd) Of controversies between such Province andany other Province or Provinces, which may have passed a like Act ; (3rd) Of suits, actions or, proceedings in which the parties theretoby their pleadings shall have raised the question of the validity of

an Act of the Parliament of Canada, when in the opinion of a Judge ofthe Court in which the same are pending such question is material ; (4th) Of suits, actions, or proceedings in which the parties thereto bytheir pleadings shall have raised the question of the validity of

an Act of the Legislature of such Province, when in the opinion of a Judgeof the Court in which the same are pending such question is material ; then this

section and the three following sections of this Act shallbe in force in the class or classes of cases in respect of which such Act so agreeing and providing, may have been passed. [39]

Section 55 then states that the Exchequer Court will hear cases falling under the first and second categories mentioned in section54, with an appeal lying to the Supreme Court.

Section 56 sets out the procedure applicable to the third and fourth categories as follows: In cases thirdly and fourthly mentioned, to be in Supreme Court, and decision sent to Court appealed from. 56. In the cases thirdly and fourthly mentioned in the next preceding

section but one, the Judge who has decided that such question ismaterial, shall order the case to be removed to the Supreme Court in order to the decision of such question, and it shall be removedaccordingly, and after the decision of the Supreme Court, the said case shall be sent back, with a copy of the judgment on the questionraised, to the Court or Judge whence it came, to be then and there dealt with as to justice may appertain. [40] Alberta argues that the fundamental difference between the first two categories of cases, which fall within the jurisdiction of theExchequer Court, and the last two, which fall under the exclusive jurisdiction of the Supreme Court, is that the last two categories ofcases relate to the validity of legislation, whereas the first two do not.

In other words, the “controversies” mentioned in the first twoparagraphs cannot relate to the validity of legislation, which is only mentioned in the last two paragraphs. If something is mentioned inone place but omitted in another, the omission is significant—the Latin maxim, inclusio unius, exclusio alterius, is often used to conveythe idea. It follows, according to Alberta, that Parliament intended to withhold from the Exchequer Court the power to strike downprovincial legislation.

With respect, this is a misreading of those provisions. [41] Alberta’s argument fails to appreciate that, through those sections, Parliament provided two fundamentally different vehicles forthe resolution of disputes that were expected to arise in the new federal context. Given those differences, the maxim inclusio unius,exclusio alterius cannot be applied. Let me explain. [42] At the time of Confederation, because of the then prevailing views of Crown immunity and indivisibility, there was no obviousjudicial forum for the resolution of disputes between governments in a federal system. The first two paragraphs of

section 54, thesubstance of which is now embodied in

section 19 of the Federal Courts Act, thus created a new kind of jurisdiction, which wouldovercome the limitations flowing from Crown immunity and indivisibility. With respect to interprovincial disputes, they also provided aforum that is not a court of one of the provinces involved. In The Queen (Canada) v. The Queen (P.E.I.), (FCA),[1978] 1 F.C. 533 (C.A.) (Canada v.

P.E.I.), at page 558, Chief Justice Jackett commented as follows on the purpose of those provisions: … In my view, this legislation (section 19 and the provincial “Act”) creates a jurisdiction differing in kind from the ordinary jurisdictionof municipal courts to decide disputes between ordinary persons or between the Sovereign and an ordinary person.

It is a jurisdiction todecide disputes as between political entities and not as between persons recognized as legal persons in the ordinary municipal courts.[Footnotes omitted.] [43] (Here, the Chief Justice uses the phrase “municipal courts” as a synonym of “domestic courts”, in opposition to internationalcourts.) [44] The last two paragraphs of

section 54 create a very different mechanism. It was an attempt to implement what is now known, inother countries, as “concentrated” or “centralized” judicial review: Favoreu, Droit constitutionnel, at page 266; Juliane Kokott andMartin Kaspar, “Ensuring Constitutional Efficacy” in Michel Rosenfeld and András Sajó, eds., The Oxford Handbook of ComparativeConstitutional Law (Great Britain: Oxford University Press, 2012) 795, at pages 807–815.

The idea was that, contrary to the existingsituation, ordinary courts would not decide constitutional issues arising in cases before them, but would rather refer them to a single,centralized constitutional court, which would be the Supreme Court: Peter H. Russell, “The Jurisdiction of the Supreme Court of Canada:Present Policies and a Programme for Reform” (1968), 6 Osgoode Hall L.J. 1, at pages 7–8. There would be, in Professor Favoreu’swords, [translation] “a specific constitutional court endowed with a monopoly on constitutional

interpretation:” Favoreu, Droitconstitutionnel, at page 266. The intention to implement such a system is made clear by the process laid out in

section 56, although itsuse was not compulsory, but left to the discretion of the judge hearing the case. [45] In making recourse to this process optional, Parliament perhaps anticipated that it could not deprive provincial superior courts ofthe jurisdiction to apply the constitution: A.G. Can. v. Law Society of B.C., (SCC), [1982] 2 S.C.R. 307. This optionalnature may explain why the process appears never to have been used. In any event, it was repealed in 1974 as part of the overhaul of theSupreme Court’s jurisdiction, and concentrated judicial review remains foreign to our constitutional tradition. [46] The difference between the two mechanisms provided for in

section 54 must be emphasized and demonstrates why Alberta’sargument fails. The first mechanism is exclusively geared towards disputes between governments and is aimed at providing a forum

when none was thought to exist. The second one pertains to constitutional issues arising in everyday litigation, in particular litigationbetween private parties. It is easy to understand why Parliament wanted only constitutional questions to be referred to the Supreme Courtby other courts. This does not mean, however, that the constitutional validity of a provincial statute could never be challenged under theExchequer Court’s jurisdiction over intergovernmental disputes. The two mechanisms provided for in

section 54 are simply unrelatedand they are not mutually exclusive. [47] Quite the contrary, the goals pursued by Parliament in enacting what became

section 19 suggest that it should receive a generousinterpretation. As Chief Justice Jackett noted, the aim was to create a new jurisdiction to deal with intergovernmental disputes. It wouldhave been obvious to the members of Parliament—several of whom had participated in the Confederation debates during which the issuewas expressly raised—that such disputes would include issues regarding the compliance of legislation with the constitutional division ofpowers. Other than in the course of private litigation, there was no obvious judicial forum to resolve such issues.

Provincial governmentswere not yet empowered to refer questions to the court of appeal of their province and could not refer a question directly to the SupremeCourt: James L Huffman and MardiLyn Saathoff, “Advisory Opinions and Canadian Constitutional Development: The Supreme Court’sReference Jurisdiction” (1990), 74 Minn. L. Rev. 1251, at page 1259. [48] Thus, contrary to Alberta’s submissions, the legislative history of

section 19 does not show that constitutional issues fall outsideits purview. To the contrary, the context in which it was enacted tends to demonstrate that it should be given a wide

interpretation andthat its authors understood that the “controversies” that this Court must resolve would include controversies as to the validity oflegislation. [49] Alberta also argues that irrespective of the scope of

section 19 of the Federal Courts Act, any claim made against Alberta underthat provision must also come within the purview of

section 27 of its Judicature Act. That is obviously true. Given, however, that thoseprovisions form part of an interlocking federal-provincial statutory scheme, I am reluctant to ascribe them different meanings in theabsence of an explicit indication to that effect. Alberta says that such an indication is provided by other provisions of the Judicature Act.The Alberta legislature would not, as the argument goes, have given the Federal Court a wider jurisdiction over constitutional issues thanto the province’s own courts. With respect, this is speculative.

In addition to being based on assumptions that I do not wish to discusshere, this argument overlooks that it is equally possible that the Alberta legislature shared Parliament’s wish to provide a national forumfor the resolution of intergovernmental disputes, including those involving the validity of legislation, and intended to fill any gaps thatmight have existed in that respect.

(2) Wording and Implied Limitations [50] Alberta also argues that the word “controversy” should not receive a broad meaning, but should rather be interpreted according tocertain Canadian precedents or in a manner similar to the phrase “cases and controversies” in the constitution of the United States. Ofcourse, I am bound by the pronouncements of higher courts as to the meaning of

section 19. A careful review of the cases invoked byAlberta, however, does not evince any intention of narrowing the scope of

section 19 in the manner suggested. Moreover, the Americanjurisprudence regarding “cases and controversies” has simply not been applied in Canada. [51] Alberta argues that for a case to come under

section 19, it must involve a “legal right, obligation or liability”. That phrase istaken from the reasons of Justice Le Dain in Canada v. P.E.I., at page 583. Justice Le Dain, however, did not set out to describe the outerlimits of

section 19. He was using those terms to make the point that Prince Edward Island’s claim in that case fell squarely withinsection 19. The full passage is as follows: …. The term “controversy” is broad enough to encompass any kind of legal right, obligation or liability that may exist betweengovernments or their strictly legal personification. It is certainly broad enough to include a dispute as to whether one government is liablein damages to another. [52] Justice Le Dain simply did not address the issue of whether a challenge to the validity of legislation could be described as a“controversy”.

Likewise, the reference to “contract or trust” in Attorney-General of Ontario v. Attorney-General of Canada (1907), (SCC), 39 S.C.R. 14, at pages 45–46 was more a description of the issue at hand than of the outer limits of the predecessor tosection 19. [53] Another early Supreme Court case provides more insight into the scope of

section 19. Province of Ontario v. Dominion ofCanada (1909), (SCC), 42 S.C.R. 1, affd [1910] A.C. 637 (P.C.), was not a challenge to the validity of legislation, but aclaim by Canada to be reimbursed by Ontario for the annuities paid according to a treaty with certain Indigenous peoples of thatprovince. After the treaty was made, the Privy Council held that, contrary to Canada’s assumption, the “extinguishment” of aboriginaltitle benefitted Ontario.

Canada’s claim to reimbursement was not based on a right recognized by statute or the common law, but ongeneral concepts of equity and on an analogy with the concept of quasi-contract in the civil law tradition. It is in that context that JusticeDuff wrote the following passage, quoted in Alberta’s memorandum, at pages 118–119: The “Exchequer Court Act” confers upon that court jurisdiction to decide a controversy such as this.

It says nothing about the rule to beapplied in reaching a decision; but it is not to be supposed that (acting as a court) that court is to proceed only upon such views as thejudge of the court may have concerning what (in the circumstances presented to him) it would be fair and just and proper that one or theother party to the controversy should do.

I think that in providing for the determination of controversies the Act speaks of controversiesabout rights; pre-supposing some rule or principle according to which such rights can be ascertained; which rule or principle could, itshould seem, be no other than the appropriate rule or principle of law.

I think we should not presume that the Exchequer Court has beenauthorized to make a rule of law for the purpose of determining such a dispute; or to apply to such a controversy a rule or principleprevailing in one locality when, according to accepted principles, it should be determined upon the law of another locality. [54] Likewise, Justice Idington wrote, at page 101: We should, I think, first consider the nature of the jurisdiction given by

section 32 of the “Exchequer Court Act” in assigning to thatcourt the power to determine “controversies” arising between the Dominion and a province that has acceded thereto.

The language is comprehensive enough to cover claims founded on some principles of honour, generosity or supposed natural justice,but no one in argument ventured to say the court was given any right to proceed upon any such ground.

It seemed conceded that we mustfind a basis for the claim either in a contractual or (bearing in mind that the controversy is the Crown against the Crown for both partiesact in the name of the Crown) quasi-contractual relation between the parties hereto or on some ground of legal equity. [55] In making these remarks, both justices were emphasizing Canada’s need to identify a legal basis for its claim. “Rights”,“contract” or “legal equity” were potentially the most relevant legal concepts in that particular case, although the Court eventuallydismissed Canada’s claim, as it had not contracted with Ontario for the reimbursement of the treaty annuities.

Insofar as we can deduceanything regarding the meaning of “controversy” in

section 19 of the Federal Courts Act, it is that such a controversy must be able to bedecided on legal grounds, as opposed to moral or policy grounds. [56] Alberta also relies heavily on the American jurisprudence dealing with

Article III of the United States Constitution, which usesthe words “cases” and “controversies” to delineate the jurisdiction of the federal judiciary. Those concepts have been interpreted asputting important restrictions on what is known as a “facial challenge”, that is, a challenge to the validity of legislation considered in theabstract, independently of its application to specific, individual circumstances: Washington State Grange v. Washington State RepublicanParty, 552 U.S. 442 (2008). They have also resulted in stringent standing requirements which discourage declaratory judgments: RescueArmy v.

Municipal Court of Los Angeles, 331 U.S. 549 (1947). [57] Needless to say, the case law interpreting

Article III of the United States Constitution does not apply in Canada. Courts haveoften noted that the Canadian approach is more generous. For instance, the Supreme Court of Canada wrote that “the principlesenunciated by the United States Supreme Court on standing are more restrictive than those that are applicable in Canada”: CanadianCouncil of Churches v. Canada (Minister of Employment and Immigration), (SCC), [1992] 1 S.C.R. 236, at page 248.Likewise, “facial challenges” are readily accepted in Canada. Recent examples include Canada (Attorney General) v.

Bedford, 2013SCC 72, [2013] 3 S.C.R. 1101 (Bedford), and Carter v. Canada (Attorney General), 2015 SCC 5, [2015] 1 S.C.R. 331 (Carter). In theSecession Reference [Reference re Secession of Quebec, (SCC), [1998] 2 S.C.R. 217], at paragraph 13, the SupremeCourt of Canada rejected the application of the American “cases and controversies” doctrine as a guide to the

interpretation of section101 of the Constitution Act, 1867. In the same fashion, it should not inform the

interpretation of

section 19 of the Federal Courts Act. [58] Alberta also tries to read in a limitation to the effect that this Court could not issue a declaratory judgment, or at least adeclaration of constitutional invalidity, in the exercise of its

section 19 jurisdiction. Alberta invoked cases where the constitutional limitsof this Court’s jurisdiction flowing from

section 101 of the Constitution Act, 1867 were explored, including Windsor, Bilodeau-Massé v.Canada (Attorney General), 2017 FC 604, [2018] 1 F.C.R. 386, and Deegan v. Canada (Attorney General), 2019 FC 960, [2020] 1F.C.R. 411. This, however, is beside the point. As I have mentioned above, this Court’s

section 19 jurisdiction is not constrained bysection 101: Alberta v. Canada, at paragraph 34. The lack of any mention of declaratory judgments in

section 19, in contrast to

section 18[of the Federal Courts Act], is not conclusive. A better comparator would be

section 17 [of the Federal Courts Act], under whichdeclaratory judgments may doubtless be issued. Moreover, declaratory judgments have been issued in cases heard under

section 19, inparticular Canada v. P.E.I. [59] Thus, there are no obstacles to a broad

interpretation of the kinds of “controversies” that may be submitted to this Court pursuantto

section 19. Alberta’s arguments have not lessened the force of Justice Johanne Gauthier’s remarks in Alberta v. Canada, at paragraph26: With respect to the subject matters covered by these provisions and more particularly by

section 19 of the FC Act, it appears that thereis no limit as to the type of controversy to which they would apply. At this stage and without the benefit of full arguments, the legislativeevolution of

section 19, as well as the manner in which both provisions have been applied, appears to support the broad scope suggestedby the ordinary meaning of the words any “controversy” or “litige” in French. [60] Thus, I find no reason to exclude challenges to the validity of legislation from the ambit of

section 19 of the Federal Courts Act.

(3) Crown Immunity [61] Alberta argues that it is immune from suit in the Federal Court. As it states in its memorandum, “in the absence of clear statutoryauthority from the sovereign, a sovereign’s laws are not assailable under the principle of Crown immunity.” This argument fails, forseveral reasons. [62] Once a common law rule, Crown immunity is now encapsulated in

section 17 of the

Interpretation Act, R.S.C., 1985, c. I-21,which reads as follows: Her Majesty not bound or affected unless started 17 No enactment is binding on Her Majesty or affects Her Majesty or Her Majesty’s rights or prerogatives in any manner, except asmentioned or referred to in the enactment. [63] In Alberta Government Telephones v. Canada (Canadian Radio-television and Telecommunications Commission), (SCC), [1989] 2 S.C.R. 225, at page 281, the Supreme Court of Canada explained in what circumstances Crown immunity isdisplaced: ….

It seems to me that the words “mentioned or referred to” in s. [17] are capable of encompassing; (1) expressly binding words(“Her Majesty is bound”); (2) a clear intention to bind which, in Bombay terminology, “is manifest from the very terms of the statute”, inother words, an intention revealed when provisions are read in the context of other textual provisions, as in Ouellette, supra; and, (3) anintention to bind where the purpose of the statute would be “wholly frustrated” if the government were not bound, or, in other words, ifan absurdity (as opposed to simply an undesirable result) were produced.

These three points should provide a guideline for when astatute has clearly conveyed an intention to bind the Crown.

[64] Alberta’s adhesion to the mechanism provided by

section 19 necessarily implies a waiver of Crown immunity. All disputescoming under the purview of

section 19 are, by definition, suits against the Crown. By enacting

section 27 of its Judicature Act, Albertawaived Crown immunity by necessary implication: see, by way of analogy, Canada (Attorney General) v. Thouin, 2017 SCC 46, [2017]2 S.C.R. 184, at paragraph 24. Moreover, Crown immunity would “wholly frustrate”

section 19, or render it entirely inoperative. [65] Indeed, in Canada v. P.E.I., at page 583, Justice Le Dain expressed the view that .… neither the doctrine of the indivisibility of the Crown nor that of Crown immunity, whether processual or substantive, should be anobstacle to a determination of intergovernmental liability under [section 19] …. [66] More recently, in Alberta v.

Canada, at paragraph 25, Justice Johanne Gauthier stated that “[t]here is thus no doubt that no issueof Crown immunity arises in respect of Alberta when sections 19 and 27 of the aforementioned statutes apply.” [67] Alberta also argues that provinces are immune from suit in the Federal Court. In practical terms such suits may be rare, but as anabstract proposition this is not true. Each provision granting jurisdiction to this Court must be examined independently: Pasqua FirstNation v. Canada (Attorney General), 2016 FCA 133, [2017] 3 F.C.R. 3, at paragraphs 50–53.

Section 17 of the Federal Courts Actdeals with suits against the Crown, which is defined in

section 2 as “Her Majesty in right of Canada”. A province cannot be sued on thatbasis. This explains one of the cases cited by Alberta, Greely v. “Tami Joan” (The) (1996), 113 F.T.R. 66 (F.C.T.D.). The same is true ofsection 18, which underpins a large proportion of the cases brought before this Court. That

section provides for the review of decisionsmade by a “federal board, commission or other tribunal,” the definition of which expressly excludes “any such body constituted orestablished by or under a law of a province or any such person or persons appointed under or in accordance with a law of a province”. Aprovince, however, may be sued in this Court for patent infringement under

section 20: Bessette v. Quebec (Attorney General), 2019 FC393 (Bessette). I acknowledge that this Court has held otherwise with respect to copyright claims: Trainor Surveys

(1974) Limited v. NewBrunswick (T.D.), (FC), [1990] 2 F.C. 168. This discrepancy may be explained by the explicit statement that thePatent Act, R.S.C., 1985, c. P-4,

section 2.1, binds the Crown and the lack of a corresponding statement in the Copyright Act, R.S.C.,1985, c. C-42: Bessette, at paragraph 98. Be that as it may,

section 19 clearly contemplates suits against provincial governments and it isdifficult to understand how Alberta can claim immunity in the face of

section 27 of its own Judicature Act. [68] There is a more fundamental reason why Alberta cannot invoke Crown immunity. As it finds its source in statute or the commonlaw, the concept of Crown immunity is inimical to the principle of the supremacy of the Constitution. When the constitutional validity oflegislation is at stake, the legislature cannot immunize itself from review without undercutting the whole foundation of the constitutionaledifice. [69] In British Columbia Power Corporation v.

British Columbia Electric Company, (SCC), [1962] S.C.R. 642 (BCPower), at pages 644–645, the Supreme Court of Canada rejected the argument that Crown immunity made it impossible to appoint areceiver of certain property until the constitutional validity of certain legislation was determined by the courts: ….In a federal system, where legislative authority is divided, as are also the prerogatives of the Crown, as between the Dominion and theProvinces, it is my view that it is not open to the Crown, either in right of Canada or of a Province, to claim a Crown immunity basedupon an interest in certain property, where its very interest in that property depends completely and solely on the validity of thelegislation which it has itself passed, if there is a reasonable doubt as to whether such legislation is constitutionally valid.

To permit it todo so would be to enable it, by the assertion of rights claimed under legislation which is beyond its powers, to achieve the same results asif the legislation were valid. [70] A slightly different case concerned the Saskatchewan legislature’s attempt to immunize itself from the obligation to reimbursetaxes collected under a statute if that statute was later found to be constitutionally invalid. In Amax Potash Ltd. Etc. v.

The Government ofSaskatchewan, (SCC), [1977] 2 S.C.R. 576, the Supreme Court of Canada, on the strength of its previous decision in BCPower, struck down the legislation that purported to bar recovery. It stated, at 592: The principle governing this appeal can be shortly and simply expressed in these terms: if a statute is found to be ultra vires thelegislature which enacted it, legislation which would have the effect of attaching legal consequences to acts done pursuant to that invalidlaw must equally be ultra vires because it relates to the same subject-matter as that which was involved in the prior legislation.

If a statecannot take by unconstitutional means it cannot retain by unconstitutional means. [71] The Supreme Court of Canada came back to this issue in Air Canada v. British Columbia (Attorney General), (SCC), [1986] 2 S.C.R. 539. At the relevant time, no one could sue the provincial Crown in British Columbia without first obtaining afiat, that is, the authorization of the government. In that case, the government had refused Air Canada a fiat to institute proceedings torecover taxes paid under legislation that was alleged to be constitutionally invalid.

The Court found that the government was bound togive the fiat, given the constitutional nature of the claim: “[a]ll executive powers, whether they derive from statute, common law orprerogative, must be adapted to conform with constitutional imperatives” (at page 545). [72] For all those reasons, Alberta cannot claim it is “immune” from the jurisdiction of this Court pursuant to

section 19 of theFederal Courts Act. C. Standing [73] Certain arguments made by Alberta with respect to this Court’s jurisdiction are, in fact, related to British Columbia’s standing toinitiate the present action. [74] Alberta submits that “[t]o the extent that there are impacts on the constitutional order, those rights belong to the federal Crown,not to the provinces.” It would follow, as the argument go

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