2021 FCA 84, 2021 FCA 84

A-386-19 2021 FCA 84 Attorney General of Alberta ( Appellant ) v. Attorney General of British Columbia ( Respondent ) Indexed as: Alberta (Attorney General) v. British Columbia (Attorney General) Federal Court of Appeal, Nadon, Rivoalen and LeBlanc JJ.A.— By videoconference, October 15, 2020; Ottawa, April 26, 2021.

Federal Court Jurisdiction — Appeal from Federal Court decision dismissing Alberta’s motion to strike action by British Columbia (B.C.) seeking declaration that Alberta’s Preserving Canada’s Economic Prosperity Act ( Act ) unconstitutional, granting B.C.’s motion for interlocutory injunction — Act authorizing Alberta’s Minister of Energy to establish licensing regime for export of natural gas, crude oil, refined fuels — Statements in Alberta legislature suggesting that Act ’s true purpose political retaliation — Federal Court finding, inter alia, that B.C.’s constitutional challenge within jurisdiction of Federal Court, that word “controversies” in Federal Courts Act , s. 19 broad enough to include disputes concerning constitutional validity of provincial legislation — Satisfied that controversy herein one falling within purview of s. 19 — Alberta arguing no controversy before Federal Court — Whether B.C.’s action falling within ambit of Federal Courts Act , s. 19 — Whether “controversy” existing between B.C., Alberta — Per LeBlanc J.A. (Rivoalen J.A. concurring): S. 19 capable of broad

interpretation — S. 19 language contemplating controversies between provinces without any qualifiers as to kinds of legal interests that can be asserted — Legislation granting jurisdiction to Federal Court should benefit from generous, liberal

interpretation — Case law dealing with s. 19 not setting out outer limits of that provision — Only limit is that dispute brought before Federal Court having to be based on some “recognized legal principle” as opposed to “ideas of abstract justice” — Intergovernmental controversies not precluding private parties from bringing claims in relation to subject matter underlying such controversies as long as s. 19 requirements met — Federal Court empowered to pronounce on constitutional validity of provincial legislation — One province threatening well-being of another presenting hallmarks of “controversy” — However, present dispute not lending itself to declaratory relief — Indeterminate threat that has not materialized into actual charge is insufficient to establish violation of Constitution Act, 1867, s. 121 — Therefore plain and obvious that, in regards to s. 121 component of B.C.’s claim, legal test for declaratory relief not met — As to s. 92A(2) component of B.C.’s claim, declaratory relief should not be granted in the absence of action taken pursuant to the Act — S. 92A(2) raising a number of interpretive issues not yet addressed by courts — In the absence of licensing scheme restricting export activities of persons or classes of persons, Federal Court lacked factual context sufficient to interpret, apply s. 92A(2) in present case — Per Nadon J.A. (concurring reasons): Plain, obvious that B.C.’s challenge of Act not constituting “controversy” falling under s. 19 — S. 19 enacted to allow Federal Court to deal with controversies of different nature than present one — Crown interests or rights not asserted herein — Federal Court’s

interpretation leading to untenable results — To extent that controversy is one where “Sovereign” or “Crown” interests, rights are being pursued, word “controversy” should be given broad

interpretation — S. 19 not enacted to provide parallel forum to that of provincial superior courts — Adopting Federal Court’s broad

interpretation opening door to intrusion by one province into affairs of another — Appeal allowed.

Constitutional Law — Distribution of Powers — Federal Court dismissing Alberta’s motion to strike action by British Columbia (B.C.) seeking declaration that Alberta’s Preserving Canada’s Economic Prosperity Act ( Act ) unconstitutional, granting B.C.’s motion for interlocutory injunction — Act authorizing Alberta’s Minister of Energy to establish licensing regime for export of natural gas, crude oil, refined fuels — Statements in Alberta legislature suggesting that Act ’s true purpose political retaliation — B.C. claiming Act exceeding Alberta’s legislative authority over trade in non-renewable natural resources, discriminating against another part of Canada in violation of Constitution Act, 1867, s. 92A(2) — Seeking declaration that Act inconsistent with Constitution of Canada, of no force and effect — Per LeBlanc J.A. (Rivoalen J.A. concurring): Present dispute not lending itself to declaratory relief — Federal Court lacking factual context sufficient to interpret, apply s. 92A(2) in present case — Court having to define scope of non-discrimination requirement in s. 92A(2) before using this provision to declare

an act unconstitutional — Absence of Ministerial action restricting supply to B.C., operational licensing scheme making it difficult to conclude what constitutes discrimination under s. 92A(2).

Constitutional Law — Federal Court dismissing Alberta’s motion to strike action by British Columbia (B.C.) seeking declaration that Alberta’s Preserving Canada’s Economic Prosperity Act ( Act ) unconstitutional, granting B.C.’s motion for interlocutory injunction — Act authorizing Alberta’s Minister of Energy to establish licensing regime for export of natural gas, crude oil, refined fuels — Statements in Alberta legislature suggesting that Act ’s true purpose political retaliation — B.C. claiming Act contrary to Constitution Act, 1867, s. 121 as it imposes barriers on the admission of articles of growth, produce, or manufacture of one province into another — Seeking declaration that Act inconsistent with Constitution of Canada, of no force and effect — Per LeBlanc J.A. (Rivoalen J.A. concurring): Present dispute not lending itself to declaratory relief — In s. 121 analysis, court must first establish that impugned law restricting movement of goods across provincial border before inquiring into law’s purpose — Indeterminate threat not yet materialized into actual charge insufficient to establish violation of s. 121.

This was an appeal from a Federal Court decision dismissing Alberta’s motion to strike an action commenced by British Columbia (B.C.) seeking a declaration that Alberta’s Preserving Canada’s Economic Prosperity Act ( Act ) was unconstitutional, and granting B.C.’s motion for an interlocutory injunction.

The Act , which came into force in 2019, authorizes Alberta’s Minister of Energy (Minister) to establish a licensing regime for the export of natural gas, crude oil, and refined fuels. The Act leaves the parameters of the licensing regime to the Minister’s discretion, having regard to the province’s public interest.

In the legislative debates leading to the passage of the Act , members of the Alberta legislature made statements suggesting that the Act ’s true purpose was political retaliation, allowing Alberta to restrict the flow of natural resources to B.C. as a response to the latter’s opposition to the Trans Mountain pipeline expansion. B.C. asserted that the Act was unconstitutional because, inter alia , the Act is a law in relation to interprovincial and international exports, and is therefore beyond provincial competence under subsection 91(2) of the Constitution Act, 1867 , unless it can be saved by

section 92A ; and the Act is contrary to

section 121 of the Constitution Act, 1867 . B.C. had previously commenced an action before the Alberta Court of Queen’s Bench seeking a declaration of invalidity in respect of the Act . Alberta responded to B.C.’s action by filing a motion to dismiss it on the grounds that the Court of Queen’s Bench had no jurisdiction to entertain the proceedings and that B.C. lacked standing to bring its action. The Court of Queen’s Bench stayed B.C.’s action until such time as the Federal Court made a determination as to whether it had jurisdiction in respect of the action commenced by B.C.

It concluded that no provincial attorney general, other than the Minister of Justice and Solicitor General of Alberta, could commence proceedings in Alberta with respect to the validity of an enactment of the Alberta legislature. The Court of Queen’s Bench referred to

section 27 of the Judicature Act , pursuant to which Alberta had agreed to grant the Federal Court jurisdiction with regard to interprovincial disputes. It stated that Parliament had enacted a matching provision, i.e.

section 19 of the Federal Courts Act . In the end, the Court of Queen’s Bench left it to the Federal Court to determine whether or not it was prepared to accept jurisdiction in regard to the matters raised in B.C.’s action. With respect to B.C.’s motion for an interlocutory injunction, the Federal Court concluded that the test set out by the Supreme Court had been met, i.e. that an applicant must satisfy the Court that his or her case raises a serious issue to be tried, that he or she will suffer irreparable harm if the application is refused and that the balance of convenience is in his or her favour.

With respect to Alberta’s motion to strike, the Federal Court found that B.C.’s constitutional challenge was within the jurisdiction of the Federal Court. It found, inter alia , that the word “controversies” in

section 19 of the Federal Courts Act was broad enough to include disputes concerning the constitutional validity of provincial legislation. The Federal Court held that the context of the enactment of

section 19 of the Federal Courts Act supported the view that “controversies” necessarily included controversies pertaining to the constitutionality of legislation. It was satisfied that to the extent that a controversy could be decided on legal grounds, as opposed to moral or policy grounds, the controversy was one that fell within the purview of

section 19 . Alberta argued, inter alia , that the Federal Court does not have jurisdiction under

section 19 with respect to the making of a bare declaration of invalidity regarding provincial legislation. It argued that such an issue is dealt with by its Judicature Act . It said that there was no controversy before the Federal Court since B.C. did not identify any right, obligation, or liability that existed between it and Alberta. B.C. claimed that the Act exceeds Alberta’s legislative authority over trade in non-renewable natural resources because it threatens an embargo on the exportation of refined fuels and crude oil, thus discriminating against another part of Canada in violation of subsection 92A(2) of the Constitution Act, 1867 . B.C. further alleged that the Act violates

section 121 of the Constitution Act, 1867 as it imposes barriers on the admission of articles of growth, produce, or manufacture of one province into another for a “tariff-like purpose”, namely to punish another province. In terms of remedy, B.C. sought a declaration that the Act “is inconsistent with the Constitution of Canada and of no force and effect”. At issue was whether B.C.’s action falls within the ambit of

section 19 of the Federal Courts Act , more particularly, whether there a “controversy” between the provinces of British Columbia and Alberta; and whether the Court should grant B.C. declaratory relief. Held , the appeal should be allowed. Per LeBlanc J.A. (Rivoalen J.A. concurring): The Federal Court has the jurisdiction, under

section 19 of the Federal Courts Act , to entertain proceedings in the nature of the one brought by B.C. in the instant case. The express language used in

section 19 contemplates controversies between provinces without any qualifiers as to the kinds of legal interests that can be asserted, be they constitutional, statutory, contractual, or other. Legislation granting jurisdiction to the Federal Court should benefit from a generous and liberal

interpretation rather than a narrow one. The case law dealing with

section 19 does not set out the outer limits of that provision nor does it define the limits of the term “controversy”. Disputes over legal rights or obligations are simply examples of controversies contemplated by

section 19 . The only limit is that the dispute brought before the Federal Court must be based on some “recognized legal principle” as opposed to “ideas of abstract justice”. Intergovernmental controversies do not necessarily preclude private parties from bringing claims, in the appropriate forum, in relation to the subject matter underlying such controversies. The fact that a particular subject matter may give rise to private claims is not, in and of itself, fatal to Federal Court jurisdiction pursuant to

section 19 , as long as the requirements of that provision are met, i.e. there is a controversy between a province and Canada or between provinces. Thus, in this case, simply because an individual who is denied a licence by the Minister has redress before the courts does not preclude the Attorney General of B.C., as representing the “people for the time being of [British Columbia] against the people for the time being of [Alberta]”. The

interpretation of “controversy” by the Court of Queen’s Bench was consistent with the

section 19 case law.

Section 57 of the Federal Courts Act provides compelling indicia that Parliament considers the Federal Court to be empowered to pronounce on the constitutional validity of provincial legislation. The meaning ascribed by the Federal Court to

section 19 , if retained, would not lead to untenable results. One province directly and openly threatening the well-being of another presents all the hallmarks of a “controversy” within the meaning of

section 19 . The kinds of “controversies” that may be considered by the Federal Court under

section 19 would include, in appropriate circumstances, challenges to the validity of legislation, including provincial legislation. The present dispute did not lend itself to declaratory relief. The Federal Court’s reasoning was problematic in relation to both components of B.C.’s claim: (

i) that based on

section 121 of the Constitution Act, 1867 and (ii) that based on subsection 92A(2) of the Constitution Act, 1867 . The Federal Court erred in holding that “the mere adoption of the act is a threat that is sufficient to give rise to a ‘live controversy’”. In a

section 121 analysis, a court must first establish that the impugned law in essence restricts the movement of goods across a provincial border before it can proceed to an inquiry into the law’s purpose. Consideration must first be given to the actual cost imposed on the movement of goods. An indeterminate threat (e.g. to “turn off the taps” or “inflict economic pain”) that has not materialized into an actual charge is insufficient to establish a violation of

section 121. It was therefore plain and obvious that, in regards to the

section 121 component of B.C.’s claim, the legal test for declaratory relief was not met. As to the subsection 92A(2)

component of B.C.’s claim, declaratory relief should not be granted in the absence of action taken pursuant to the Act . The term “discrimination” in subsection 92A(2) raises a number of interpretive issues which have yet to be addressed by the courts. In the absence of a licensing scheme restricting the export activities of persons or classes of persons, the Federal Court lacked a factual context sufficient to interpret and apply subsection 92A(2) in the present case. The language contained in

section 92A is of a more technical or specialized nature than that typically employed in a constitutional text. In light of such interpretive difficulties, a court will have to carefully define the scope of the non-discrimination requirement in subsection 92A(2) before this provision can be invoked to declare an act unconstitutional. An interpretive exercise of this kind should not take place in the abstract. The lack of a licensing scheme makes it difficult to conclude what constitutes discrimination under subsection 92A(2) and whether the Act falls outside of what is permitted by this provision.

In the absence of Ministerial action restricting supply to B.C. and without regulations and an operational licensing scheme, a court should refrain from assessing the constitutional validity of the Act on the basis that it authorizes or provides for discrimination contrary to subsection 92A(2). Per Nadon J.A. (concurring reasons): There was no arguable case that the Federal Court had jurisdiction in the present matter. There was no controversy between B.C. and Alberta within the meaning of

section 19 . A review of the case law showed that

section 19 was enacted to allow the Federal Court to deal with controversies of a different nature than the present one. An action commenced under

section 19 is one which pits the Crown against the Crown wherein Crown interests or rights must be asserted, which was clearly not the case in this appeal. The meaning ascribed to the provision by the Federal Court leads to untenable results. More particularly, the Federal Court’s reasoning would allow it to assume jurisdiction over matters that neither the provinces nor Canada ever intended to submit to the Federal Court under

section 19 . The case law revealed that the controversies to be heard under

section 19 are not “ordinary” disputes between citizens and the Crown or between citizens. To the extent that the controversy or the dispute is one where “Sovereign” or “Crown” interests and rights are being pursued, the word “controversy” should be given a broad

interpretation. This begged the question whether B.C. was asserting “Sovereign” or “Crown” interests or rights against Alberta. There was no doubt, in the present matter, that the Act could be challenged if the Minister denies a licence to an individual or a corporation to export natural gas, crude oil or refined fuels.

Section 19 cannot have been enacted to provide a parallel forum to that of the provincial superior courts so as to allow the Attorney General of Canada to challenge provincial legislation or to allow provincial attorneys general to challenge either federal legislation or another province’s legislation in the Federal Court. Adopting the Federal Court’s broad

interpretation of

section 19 would open the door to intrusion by one province into the affairs of other provinces. STATUTES AND REGULATIONS CITED British North America Act , 1867 (The) , 30 & 31 Vict., c. 3 (U.K.) [R.S.C., 1985, Appendix II, No. 5], ss. 96, 111, 142, 146. Canada Assistance Plan , R.S.C., 1985, c. C-1. 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. 24(1). 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. 101, 121. Constitution Act, 1982 ,

Schedule B, Canada Act 1982 , 1982, c. 11 (U.K.) [R.S.C., 1985, Appendix II, No. 44], s. 43(a). Exchequer Court Act , R.S.C. 1906, c. 140, s. 32. Federal Court Act , R.S.C. 1970 (2nd Supp.), c. 10, s. 32. Federal Courts Act , R.S.C., 1985, c. F-7, ss. 17 , 19 , 57 . Federal Courts Rules , SOR/98-106, r. 221 . Federal-Provincial Fiscal Arrangements and Federal Post-Secondary Education and Health Contributions Act , R.S.C., 1985, c. F-8 [now Federal-Provincial Fiscal Arrangements Act , R.S.C., 1985, c. F-8 ]. Judicature Act , R.S.A. 2000, c. J-2, ss. 25 , 27 . Liquor Control Act , R.S.N.B. 1973, c.

L-10, ss. 43 (c), 134 (b). Preserving Canada’s Economic Prosperity Act , S.A. 2018, c. P-21.5 . Provincial Offences Procedure Ac t, S.N.B. 1987, c. P-22.1, s. 116(3) . Supreme and Exchequer Courts Act (The) , S.C. 1875, c. 11, ss. 54, 55, 56, 57. Supreme Court Act , R.S.C., 1985, c. S-26, s. 35.1 . TREATIES AND OTHER INSTRUMENTS CITED Natural Resources Transfer Agreement (Alberta), confirmed by the 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]. Treaty No. 3 (1873). Treaty No. 7 (1877). CASES CITED

APPLIED: Daniels v. Canada (Indian Affairs and Northern Development), 2016 SCC 12, [2016] 1 S.C.R. 99; R. v. Comeau, 2018 SCC 15,[2018] 1 S.C.R. 342; Ewert v. Canada, 2018 SCC 30, [2018] 2 S.C.R. 165; Canada (Citizenship and Immigration) v. Canadian Councilfor Refugees, 2021 FCA 72. CONSIDERED: British Columbia (Attorney General) v. Alberta (Attorney General), 2019 ABQB 550 , 1 Alta. L.R. (7th) 370; British Columbia(Attorney General) v. Alberta (Attorney General), 2019 FC 1195, [2020] 2 F.C.R. 124; Alberta v. Canada, 2018 FCA 83, 425 D.L.R.(4th) 366, affg Kainaiwa Nation (Blood Tribe) v.

Canada, 2016 FC 817; Province of Ontario v. Dominion of Canada (1909), (SCC), 42 S.C.R. 1, 1909 CarswellNat 23 (WL Can.), affd [1910] UKPC 40, [1910] A.C. 637 (P.C.) (sub nom. The Dominionof Canada v. The Province of Ontario); The Queen (Canada) v. The Queen (P.E.I.), (FCA), [1978] 1 F.C. 533,(1977), 83 D.L.R. (3d) 492 (C.A.); Attorney-General of Ontario v. Attorney-General of Canada (1907), 39 S.C.R. 14, ;Canada v. Quebec (Attorney General), 2008 FCA 201, 381 N.R. 298; R. v. Comeau, 2016 NBPC 3, 448 N.B.R. (2d) 1, leave to appealrefused (N.B.C.A.); Windsor (City) v.

Canadian Transit Co., 2016 SCC 54, [2016] 2 S.C.R. 617; ITO-Int’l TerminalOperators v. Miida Electronics, (SCC), [1986] 1 S.C.R. 752, (1986), 28 D.L.R. (4th) 641; Finlay v. Canada (Minister ofFinance), (SCC), [1986] 2 S.C.R. 607, (1986), 33 D.L.R. (4th) 321; Finlay v. Canada (Minister of Finance), (SCC), [1993] 1 S.C.R. 1080, (1993), 101 D.L.R. (4th) 567; Solosky v. The Queen, (SCC), [1980] 1 S.C.R. 821,(1979), 105 D.L.R. (3d) 745; Operation Dismantle v. the Queen, (SCC), [1985] 1 S.C.R. 441, (1985), 18 D.L.R. (4th)481. REFERRED TO: Fairford Band v.

Canada (Attorney General), [1995] 3 F.C. 165, (T.D.), affd (1996), 205 N.R. 380 (F.C.A.), 1996CarswellNat 1717 (WL Can.); Southwind v. Canada, 2011 FC 351, 386 F.T.R. 265, 2011 CarswellNat 892 (WL Can.); Manitoba (A.G.)v. Metropolitan Stores Ltd., (SCC), [1987] 1 S.C.R. 110, (1987) 38 D.L.R. (4th) 321; RJR–MacDonald Inc. v. Canada(Attorney General), (SCC), [1994] 1 S.C.R. 311, (1994), 164 N.R. 1; Harper v. Canada (Attorney General),2000 SCC 57, [2000] 2 S.C.R. 764; Rizzo & Rizzo Shoes Ltd. (Re), (SCC), [1998] 1 S.C.R. 27, (1998) 154 D.L.R. (4th)19; Pasqua First Nation v.

Canada (Attorney General), 2016 FCA 133, [2017] 3 F.C.R. 3, 483 N.R. 63; Bell ExpressVu LimitedPartnership v. Rex, 2002 SCC 42, [2002] 2 S.C.R. 559; Canada (Human Rights Commission) v. Canadian Liberty Net, (SCC), [1998] 1 S.C.R. 626, (1998), 157 D.L.R. (4th) 385; Canada (Prime Minister) v. Khadr, 2010 SCC 3, [2010] 1 S.C.R. 44;Northern Telecom v. Communications Workers, (SCC), [1980] 1 S.C.R. 115, (1979), 98 D.L.R. (3d) 1. AUTHORS CITED Chandler, Marsha A. “Constitutional Change and Public Policy: The Impact of the Resource Amendment (Section 92A)” (1986), 19:1Can. J. Political Science 103.

Downey, Brendan et al., “Federalism in the Patch: Canada’s Energy Industry and the Constitutional Division of Powers” (2020), 58:2Alta. L. Rev. 273. Moull, William D. “Section 92A of the Constitution Act, 1867” (1983), 61:4 Can. B. Rev. 715. Moull, William D. “The Legal Effect of the Resource Amendment – What’s New in

Section 92A?” in J. Peter Meekison, 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). Semkow, Brian W. “Energy and the New Constitution” (1985), 23:1 Alta. L. Rev. 101. APPEAL from a Federal Court decision (2019 FC 1195, [2020] 2 F.C.R. 124) dismissing Alberta’s motion to strike an actioncommenced by British Columbia seeking a declaration that the Preserving Canada’s Economic Prosperity Act was unconstitutional, andgranting British Columbia’s motion for an interlocutory injunction. Appeal allowed. APPEARANCES Doreen Mueller and Sean McDonough for appellant. J.

Gareth Morley and Robert Danay for respondent. SOLICITORS OF RECORD Alberta Justice and Solicitor General, Edmonton, for appellant. Ministry of Attorney General, Vancouver, for respondent. The following are the reasons for judgment rendered in English by [1] Nadon J.A. (concurring reasons): I have read the reasons which my colleague LeBlanc J.A. gives in support of his conclusionthat the appeal should be allowed with costs in favour of the appellant, the Attorney General of Alberta (Alberta). Although I agreeentirely with his proposed disposal of the appeal, I come to that conclusion for different reasons. I.

Introduction [2] On May 18, 2018, the Lieutenant Governor of Alberta gave royal assent to the Preserving Canada’s Economic Prosperity Act,

S.A. 2018, c. P-21.5 (the Act) which was proclaimed into force on April 30, 2019. The Act authorizes the Minister of Energy (theMinister) to establish a licensing regime for the export of natural gas, crude oil, and refined fuels. The Act leaves the parameters of thelicensing regime to the Minister’s discretion, having regard to the province’s public interest.

Before enacting a licensing regime, theMinister must have regard to whether an adequate pipeline capacity exists to maximise the return on crude oil and diluted bitumenproduced in Alberta and whether adequate supplies and reserves of natural gas, crude oil, and refined fuels will be available for Alberta’spresent and future needs. The Minister may also have regard to any other matter that she considers relevant.

The Act also authorises theLieutenant Governor in Council to make regulations, including regulations necessary to enable the Minister to perform her duties underthe Act. [3] In the legislative debates leading to the passage of the Act, members of the Alberta legislature made statements suggesting thatthe Act’s true purpose was political retaliation. That is, the Act would allow Alberta to restrict the flow of natural resources to BritishColumbia as a response to the latter’s opposition to the Trans Mountain pipeline expansion.

At all times material to these proceedings,the Minister had not yet established a licensing regime nor had the Lieutenant Governor in Council made any regulations under the Act. [4] On May 1, 2019, the Attorney General of British Columbia (B.C.) commenced an action before the Alberta Court of Queen’sBench (the Alberta Court) seeking a declaration of invalidity in respect of the Act.

Alberta responded to B.C.’s action by filing a motionto dismiss it on the grounds that the Alberta Court had no jurisdiction to entertain the proceedings and that B.C. lacked standing to bringits action. [5] Pending the resolution of the above issue, B.C. commenced an action, pursuant to

section 19 of the Federal Courts Act, R.S.C.,1985, c. F-7 (the FCA) in the Federal Court on June 14, 2019, in which it sought a declaration that the Act was unconstitutional. Moreparticularly, at paragraph 4 of its statement of claim, B.C. sets out the grounds upon which it relies for its assertion of unconstitutionality: 4. The Plaintiff says the Act is unconstitutional for the following reasons: a. The Act is a law in relation to interprovincial and international exports, and would therefore [be] beyond provincial competence unders. 91(2) of the Constitution Act, 1867, unless it can be saved by

section 92A. b.

Section 92A(2) of the Constitution Act, 1867 authorizes provincial legislatures to make laws that would otherwise be outsideprovincial competence as a result of s. 91(2), but only if i. those laws are in relation to exports to another part of Canada of the “primary production” of non-renewable natural resources; and ii. such laws do not “authorize or provide for discrimination in prices or in supplies exported to another part of Canada.” c. The Act purports to be in relation to the export of “refined fuels,” including gasoline, diesel, aviation fuel, and locomotive fuel, whichare not the primary production of petroleum resources, as defined in s. 92A and the Sixth

Schedule to the Constitution Act, 1867. d. The Act authorizes discrimination in supplies of natural gas and crude oil exported to British Columbia. e.

Section 121 of the Constitution Act, 1867 guarantees that the articles of growth, produce, and manufacture of each province “shall...beadmitted free into the other provinces.” The Act’s essence and purpose is to increase the cost of trade in natural gas, crude oil, andrefined fuels across the Albert[a]-British Columbia border for a tariff-like purpose, namely to punish British Columbia.

The Act istherefore contrary to s. 121 of the Constitution Act, 1867. [6] B.C. further says that its action constitutes a controversy between it and Alberta and that both provinces have enacted legislationsignifying their assent to the Federal Court having jurisdiction in regard to controversies between their province and another province. [7] Also of importance is B.C.’s statement, found at paragraph 1 of its statement of claim, that it has commenced its action acting asparens patriae “on behalf of the public interest of the residents of British-Columbia”. [8] On July 19, 2019, Hall J. of the Alberta Court [British Columbia (Attorney General) v.

Alberta (Attorney General),2019 ABQB 550 , 1 Alta. L.R. (7th) 370] stayed B.C.’s action until such time as the Federal Court made a determination as towhether it had jurisdiction in respect of the action commenced in that Court by B.C. on June 14, 2019. [9] Two motions were heard by the Federal Court on September 12 and 13, 2019. First, Alberta brought a motion under rule 221 ofthe Federal Courts Rules, SOR/98-106 (the Rules) asking the Court to strike B.C.’s action because it disclosed no reasonable cause ofaction.

More particularly, Alberta argued that the Federal Court had no jurisdiction to hear B.C.’s action under

section 19 of the FCA,and that the action was premature. Second, B.C. brought a motion for an interlocutory injunction seeking an order prohibiting theMinister from exercising her powers under the Act until such time as the matter raised in the proceedings had been finally disposed of. [10] On September 24, 2019, Grammond J. (the Judge) dismissed Alberta’s motion to strike and granted B.C.’s motion for aninterlocutory injunction (British Columbia (Attorney General) v.

Alberta (Attorney General), 2019 FC 1195, [2020] 2 F.C.R. 124). [11] On October 4, 2019, Alberta filed an appeal of the Judge’s decision asking this Court to set aside the Judge’s decision and todismiss B.C.’s action. Alberta also seeks its costs. [12] For the reasons that follow, I would allow Alberta’s appeal. II. Legislation [13] The relevant legislation at the heart of this appeal is reproduced immediately as follows: Federal Courts Act, R.S.C., 1985, c. F-7

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 Court of Canada has jurisdiction in cases of controversies between Canada and that province, or between that province and any other province or provinces that have passed a like Act , the Federal Court has jurisdiction to determine the controversies. [My emphasis.] Judicature Act , R.S.A. 2000, c. J-2 (Alberta) Action by Attorney General or Minister of Justice and Solicitor General 25(1) The Court has jurisdiction to entertain an action at the instance of either (

a) the Attorney General of Canada, or (

b) the Minister of Justice and Solicitor General of Alberta, for a declaration as to the validity of an enactment of the Legislature though no further relief is prayed or sought .

(2) An action under this

section for a declaration as to the validity of an enactment is deemed sufficiently constituted if the Attorney General of Canada and the Minister of Justice and Solicitor General of Alberta are parties to it.

(3) A judgment in an action under this

section may be appealed against as other judgments of the Court. … Jurisdiction of federal courts 27 The Supreme Court of Canada and the Federal Court of Canada, or the Supreme Court of Canada alone, according to the Supreme Court Act (Canada) and the Federal Court Act (Canada) have jurisdiction (

a) in controversies between Canada and Alberta; (

b) in controversies between Alberta and any other province or territory of Canada in which an Act similar to this Act is in force; (

c) in proceedings in which the parties by their pleadings have raised the question of the validity of

an Act of the Parliament of Canada or of

an Act of the Legislature of Alberta, when in the opinion of a judge of the court in which they are pending the question is material, and in that case the judge shall, at the request of the parties, and may without request if the judge thinks fit, order the case to be removed to the Supreme Court of Canada in order that the question may be decided. [My emphasis.] Supreme and Exchequer Courts Act , S.C. 1875, c. 11 54.

When the Legislature of any Province forming part of Canada shall have passed an Act agreeing and providing that the Supreme Court, 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 and any other Province or Provinces, which may have passed a like Act ; (3 rd ) Of suits, actions, or proceedings in which the parties thereto by 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 of the Court in which the same are pending such question is material; (4 th ) Of suits, actions, or proceedings in which the parties thereto by their pleadings shall have raised the question of the validity of

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

section and the three following sections of this Act shall be in force in the class or classes of cases in respect of which such Act so agreeing and providing, may have been passed. 55. The procedure in the cases firstly and secondly mentioned in the next preceding

section shall be in the Exchequer Court, and an appeal shall lie in any such case to the Supreme Court. 56. In the cases thirdly and fourthly mentioned in the next preceding

section but one, the Judge who has decided that such question is material, shall order the case to be removed to the Supreme Court in order to the decision of such question, and it shall be removed accordingly, and after the decision of the Supreme Court, the said case shall be sent back, with a copy of the judgment on the question raised, to the Court or Judge whence it came, to be then and there dealt with as to justice may appertain. 57.

The next two preceding sections apply only to cases of a civil nature and shall take effect in the cases therein provided for respectively, whatever may be the value of the matter in dispute, and there shall be no further appeal to the Supreme Court on any point decided by it in any such case, nor on any other point unless the value of the matter in dispute exceeds five hundred dollars. [My emphasis.] Exchequer Court Act , R.S.C 1906, c. 140 32. When the legislature of any province of Canada has passed an Act agreeing that the Exchequer Court shall have jurisdiction in case of controversies , (

a) between the Dominion of Canada and such province; (

b) between such province and any other province or provinces which have passed a like Act ; the Exchequer Court shall have jurisdiction to determine such controversies.

2. An appeal shall lie in such cases from the Exchequer Court to the Supreme Court. [My emphasis.] Supreme Court Act, R.S.C., 1985, c. S-26 Inter-governmental disputes 35.1 An appeal lies to the Court from a decision of the Federal Court of Appeal in the case of a controversy between Canada and aprovince or between two or more provinces. III.

Decision of the Alberta Court [14] Before setting out the Judge’s reasons for concluding as he did, it will be useful, for a proper understanding of his decision and ofthe issues before us, to set out the reasons for which Hall J. of the Alberta Court concluded that a stay of B.C.’s action should be grantedpending a determination by the Federal Court as to whether it had jurisdiction under

section 19 of the FCA. Hall J. concluded as he didfor the following reasons. [15] First, at paragraph 8 of his reasons, Hall J. indicated that the principal issue which he had to determine was whether the attorneygeneral of a province had standing to seek declaratory relief with respect to the constitutionality of another province’s legislation.

In hisview, that question required him to examine the law pertaining to direct standing and public interest standing in the context ofproceedings instituted against the Crown. [16] He indicated that one of the purposes of the law of standing is to ensure that persons harmed by unconstitutional legislationshould have access to an independent and impartial tribunal that can force a legislature to comply with the law and the Constitution.

HallJ. also indicated that declaratory relief is one of the main reliefs sought in constitutional challenges and that a declaration that a statute isunconstitutional, whether a federal or a provincial statute, falls within the inherent powers of provincial superior courts. [17] Hall J. then addressed the question of whether B.C. had standing to bring the action now before him.

He indicated that B.C. tookthe position that it had standing to bring the action as the representative of the provincial public interest, adding that Alberta was of theview that B.C. could not establish direct or private standing because its rights were not and would not be directly affected by the Act. [18] After a careful review of

section 25 of the Alberta Judicature Act, R.S.A. 2000, c.

J-2, (the Judicature Act) which provides that,in cases where no other relief is sought, only the Attorney General of Canada or the Minister of Justice and Solicitor General of Albertamay commence an action for a declaration as to the validity of legislation enacted by the Alberta legislature, and after considering theparties’ respective arguments in regard thereto, Hall J. concluded that no provincial attorney general, other than the Minister of Justiceand Solicitor General of Alberta, could commence proceedings in Alberta with respect to the validity of an enactment of the Albertalegislature. [19] In making these remarks, Hall J. made it clear that any person, affected by a provincial law, could challenge the constitutionalvalidity of an Alberta legislative enactment either in the context of litigation brought under subsection 24(1) of the Canadian Charter ofRights 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] (the Charter), or in the context of, for example, a legitimate claim for damages or other relief. In the words of HallJ., at paragraph 22 of his reasons, “actions that go beyond seeking a bare declaration are not caught by

section 25. Presumably, this isbecause the ability to claim damages and other relief requires that the plaintiff has been directly affected by the law, meaning that theplaintiff has direct standing to challenge it.” [20] Hall J. then made the point that because of the existence of

section 19 of the FCA, B.C. was not without a remedy. He thenreferred to

section 27 of the Judicature Act, pursuant to which, in his view, Alberta had agreed to grant the Federal Court jurisdictionwith regard to interprovincial disputes. He stated that Parliament had enacted a matching provision to that of

section 27 of the JudicatureAct, i.e.

section 19 of the FCA, adding that a similar provision had existed in federal legislation since 1875 when Parliament enactedsection 54 of the Supreme and Exchequer Courts Act, S.C. 1875, c. 11. [21] After a close examination of these provisions and some of the case law pertaining thereto, Hall J. concluded, at paragraph 39 ofhis reasons, that “[i]n my view, the current dispute between the AGBC and the AGAB falls within the scope of these

definitions”, i.e. thedefinitions of the word “controversy” as explained in Fairford Band v. Canada (Attorney General), [1995] 3 F.C. 165, (T.D.), affd (1996), 205 N.R. 380 (F.C.A.), 1996 CarswellNat 1717 (WL Can.); Southwind v. Canada, 2011 FC 351, 386 F.T.R. 265,2011 CarswellNat 892 (WL Can.) and Alberta v. Canada, 2018 FCA 83, 425 D.L.R. (4th) 366 (Alberta v.

Canada). [22] As a result, Hall J. explained that although he agreed with Alberta that, absent a claim for further relief, only the AttorneyGeneral of Canada and the Minister of Justice and Solicitor General of Alberta could seek a declaration regarding the validity of the lawsof Alberta in the Alberta Court, that view did not leave B.C. without a recourse and it did not immunize Alberta from a constitutionalchallenge to the Act. [23] At paragraph 44 of his reasons, Hall J. made the following remarks: 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.

The Federal Court of Appeal’s comments quoted above support this view, since it said that “without

section 19 of the FC Act…”one province would have to sue in the other province’s court, which implies that with

section 19 of the Federal Courts Act, it is theFederal Court that is the proper forum. [Emphasis in the original.] [24] Lastly, Hall J. turned to the question of whether he should exercise his discretion and grant B.C. public interest standing which,in his view, “is not necessarily ruled out by

section 25 of the Judicature Act” (Hall J.’s reasons, at paragraph 45). [25] Although Hall J. appeared to be receptive to B.C.’s request for public interest standing, he declined to come to a definite

conclusion because of his view that B.C.’s standing as of right in the Federal Court under

section 19 of the FCA weighed against thegranting of public interest standing. As such, “the combined effect of

section 27 of the Judicature Act and

section 19 of the FederalCourts Act ensures that the Act will not be so immunized” (Hall J.’s reasons, at paragraph 52). In other words, the existence of a recoursein the Federal Court ensures that the Act will not escape scrutiny. [26] In the end, Hall J. stayed B.C.’s action, leaving it to the Federal Court to determine whether or not it was prepared to acceptjurisdiction in regard to the matters raised in B.C.’s action. [27] I now turn to the Federal Court’s decision. IV. The Federal Court’s Decision [28] As I have already indicated, the Judge disposed of two motions.

With respect to B.C.’s motion for an interlocutory injunction, heconcluded that the test set out by the Supreme Court in Manitoba (A.G.) v. Metropolitan Stores Ltd., (SCC),[1987] 1 S.C.R. 110, (1987) 38 D.L.R. (4th) 321; RJR–MacDonald Inc. v. Canada (Attorney General), (SCC),[1994] 1 S.C.R. 311, (1994), 164 N.R. 1; and in Harper v.

Canada (Attorney General), 2000 SCC 57, [2000] 2 S.C.R. 764, had been met,i.e. that an applicant must satisfy the Court that his or her case raises a serious issue to be tried, that he or she will suffer irreparable harmif the application is refused and that the balance of convenience is in his or her favour. [29] Not only did the Judge find that B.C.’s claim raised a serious issue, he found that B.C. had established a strong case that the Actwas invalid.

He further found that B.C. would suffer irreparable harm if the injunction were to be denied and that the balance ofconvenience was in favour of granting the injunction. [30] With respect to Alberta’s motion to strike, the Judge found that B.C.’s constitutional challenge was within the jurisdiction of theFederal Court. He arrived at that conclusion by examining the words, context, and purpose of

section 19 of the FCA. In his view, theword “controversies” was broad enough to include disputes concerning the constitutional validity of provincial legislation. Moreparticularly, the Judge was of the opinion that there could be no doubt that there was a controversy between B.C. and Alberta with regardto the constitutionality of the Act. [31] The Judge held that the circumstances surrounding the enactment in 1875 of

section 54 of the Supreme and Exchequer CourtsAct, which eventually became

section 19 of the FCA, supported the broad ordinary meaning of the word controversy. The Judge alsoindicated that his review of these circumstances had led him to reject Alberta’s argument that Parliament had expressly considered theissue of challenges to the validity of provincial legislation and that it had chosen to grant jurisdiction in regard thereto to the SupremeCourt only. [32] More particularly, the Judge dismissed, for its lack of merit, Alberta’s argument that the second two paragraphs of

section 54 ofthe Supreme and Exchequer Courts Act, which gave lower court judges the discretion to refer constitutional questions to the SupremeCourt of Canada, was an indication that Parliament intended to limit the Exchequer Court’s jurisdiction in respect of intergovernmentaldisputes to non-constitutional questions. In the Judge’s view, the two mechanisms set out in

section 54, i.e. the adjudication ofintergovernmental disputes and referrals of constitutional questions to the Supreme Court, were “simply unrelated and they are notmutually exclusive” (Judge’s reasons, at paragraph 46). [33] In addition to this brief

summary of the Judge’s reasons, I also wish to highlight some of the other remarks made by the Judge.At paragraph 30 of his reasons, concerning Alberta’s rule 221 motion, the Judge indicated that Alberta’s challenge to B.C.’s action wasnot based on constitutional grounds. In particular, Alberta’s position was not that

section 101 of the Constitution Act, 1867, 30 & 31Vict., 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] (the Constitution Act, 1867) constituted a bar to B.C.’s action commenced under

section 19 of the FCA but ratherthat, on a proper

interpretation of the section, B.C.’s challenge was not a controversy which fell within the ambit of

section 19. [34] At paragraph 48 of his reasons, the Judge held that the context of the enactment of

section 19 of the FCA supported the view that“controversies” necessarily included controversies pertaining to the constitutionality of legislation. [35] The Judge also addressed Alberta’s argument that for an action to come within the ambit of

section 19, there had to be issuespertaining to legal rights, obligations, or liabilities, which was clearly not the case herein. In order to answer that submission, the Judgeconsidered some of the decisions (and there are very few) which dealt with

section 19 of the FCA or its predecessor provisions. Moreparticularly, the Judge considered the Supreme Court’s decision in Province of Ontario v. Dominion of Canada (1909), (SCC), 42 S.C.R. 1, 1909 CarswellNat 23 (WL Can.), affd [1910] UKPC 40, [1910] A.C. 637 (P.C.) (Ontario v. Canada 1909 cited toS.C.R.) and this Court’s decisions in The Queen (Canada) v. The Queen (P.E.I.), (FCA), [1978] 1 F.C. 533, (1977),83 D.L.R. (3d) 492 (C.A.) (Canada v. P.E.I.) and Alberta v. Canada.

Although in none of these cases did any party seek a declaration ofunconstitutionality of either provincial or federal legislation, the Judge was of the view that this consideration was of no relevancebecause he was satisfied that to the extent that a controversy could be decided on legal grounds, as opposed to moral or policy grounds,the controversy was one that fell within the purview of

section 19. In support of that view, the Judge referred to my colleague GauthierJ.A.’s remarks in Alberta v. Canada, where she expresses herself as follows at paragraph 26 of her reasons: With respect to the subject matters covered by these provisions and more particularly by

section 19 of the FC Act, it appears that there isno 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. [My emphasis.] [36] At paragraph 80 of his reasons, the Judge indicated that merely because B.C.’s action was the first attempt ever by a provincialattorney general in Canadian legal history to obtain a declaration of invalidity of another province’s legislation by way of

section 19, thisdid not mean that the Federal Court was without jurisdiction. The Judge opined as follows: I would simply add that the fact that this is the first attempt to initiate such a challenge in this Court does not prove that we lack

jurisdiction. We do not know whether this possibility was contemplated in the above-mentioned cases or in a case mentioned by Alberta,Attorney-General for Manitoba v. Manitoba Egg and Poultry Association et al., (SCC), [1971] S.C.R. 689. The lack ofpositive precedent may have deterred lawyers. But there is no negative precedent either. [37] Further, the Judge dealt with Alberta’s argument that B.C.’s action was premature. In the course of his discussion of that issue, hemade the point that there existed a “live controversy” within the meaning of what was said by the Supreme Court in Daniels v.

Canada(Indian Affairs and Northern Development), 2016 SCC 12, [2016] 1 S.C.R. 99. Of particular relevance, in the Judge’s view, is the factthat members of the Alberta legislature had made statements to the effect that the purpose of the Act was to cause economic hardship tothe province of British Columbia.

Given these statements, the mere passage of the Act without any further action by the Minister wassufficient to conclude that there was a live controversy. [38] As I am concluding that we should set aside the Judge’s decision, I therefore need not address that part of his reasons which dealwith B.C.’s motion for an interlocutory injunction. V. Alberta’s Arguments [39] In challenging the Judge’s decision, Alberta makes a number of arguments. However, for present purposes, I will restrict myselfto the following. [40] First, it says that the Federal Court does not have jurisdiction under

section 19 with respect to the making of a bare declaration ofinvalidity in regard to provincial legislation.

It argues that such an issue is dealt with by its Judicature Act which does not allow anyprovincial attorney general, other than the Minister of Justice and Solicitor General of Alberta, to seek a declaration, absent a claim forfurther relief, with regard to the validity of Alberta legislative enactments. [41] Alberta further says that the review of the constitutionality of provincial legislation falls clearly within the jurisdiction ofprovincial superior courts and that anyone affected by the Act may challenge its constitutionality before the Alberta Court.

Hence, thereis no jurisdictional void to fill in respect of the constitutionality of its laws or those of any other province. [42] Turning to the meaning of the word “controversy”, Alberta argues that there must be an actual or real dispute over rights andobligations so that the Federal Court may exercise its jurisdiction under

section 19 of the FCA. In making this argument, Alberta relieson this Court’s decision in Canada v. P.E.I. (reasons of Le Dain J., at pages 582–583) and on the Supreme Court’s decision in Ontario v.Canada 1909 (reasons of Duff J., at page 119). [43] Alberta also says that the words of the heading to

section 19 “Intergovernmental disputes” connote the existence of a concretedisagreement between two provinces or between a province and Canada, not an action for a bare declaration of invalidity of eitherprovincial or federal legislation. [44] Thus, as I understand Alberta’s submissions, it says that there is no controversy before the Federal Court since B.C. has notidentified any right, obligation, or liability that exists between it and Alberta. Needless to say, B.C. does not agree with any of thesesubmissions and it supports the Judge’s reasons in their entirety. VI.

Issue [45] The parties frame the issue to be determined in a slightly different manner. In its memorandum of fact and law, at paragraph 16,Alberta sets out the issue to be disposed of as follows: Did the motions judge err in finding that the Federal Court has jurisdiction over AGBC’s application for a bare declaration ofunconstitutionality of Alberta legislation?

AGAB submits that the Motions Judge did so err. [46] As for B.C., it says, at paragraph 26 of its memorandum of fact and law, that the question to be determined is the following: Is it plain and obvious that an action by one province for a declaration of unconstitutionality of the legislation of another is not a“controversy” within the meaning of

section 19 of the Federal Courts Act? [47] Thus, the question which we must answer is whether B.C.’s action falls within the ambit of

section 19 of the FCA. Moreparticularly, is there a “controversy” between the provinces of British Columbia and Alberta? VII. Analysis [48] Before proceeding, a few words on the applicable standard of review are in order. [49] This is an appeal of the Judge’s decision in respect of a motion to dismiss brought by Alberta pursuant to rule 221 of our Rules.Both parties agree that the applicable standard is correctness as the question for determination is whether it is “plain and obvious” thatthe Federal Court does not have jurisdiction to hear B.C.’s action under

section 19. [50] I agree with B.C. that the appeal should be dismissed if we agree with the Judge’s view that the Federal Court has jurisdictionunder

section 19 or if we conclude that there is an arguable case to that effect. For the reasons which I will now explain, it is my viewthat there is no arguable case that the Federal Court has jurisdiction in the present matter. [51] I begin by stating the obvious.

Section 19 confers jurisdiction on the Federal Court to adjudicate controversies between twoprovinces or between a province and Canada. The Federal Court’s jurisdiction under

section 19 is premised on the parties before theCourt, i.e., in this case the provinces of Alberta and British Columbia, having given their consent to the Court’s jurisdiction over thecontroversy. I would further say that the Federal Court’s jurisdiction under

section 19 is a jurisdiction over matters in respect of which itwould not normally have jurisdiction.

[52] The Judge’s reasoning, as I understand it, is that there exists a controversy between the provinces of British Columbia andAlberta because the Attorney General of B.C. is challenging the constitutionality of the Act and that the controversy is “live” becausethe purpose of the Act is to punish the province of British Columbia for its lack of support in regard to the Trans Mountain pipelineexpansion project. [53] There is no dispute between the parties that statutory provisions, like

section 19 herein, are to be interpreted according to the“modern principle” of statutory

interpretation which requires us to read the words of the provision in their entire context and in theirgrammatical and ordinary sense harmoniously with the scheme and the object of the statute and the intention of the legislating body(Rizzo & Rizzo Shoes Ltd. (Re), (SCC), [1998] 1 S.C.R. 27, (1998) 154 D.L.R. (4th) 193, at paragraph 21). Thus,looking at the text, context and purpose of

section 19, what do the words “of controversies between … that province and any otherprovince” mean? [54] My contention is that there is no controversy between B.C. and Alberta within the meaning of

section 19 of the FCA. Becauseneither the legislative history of the provision nor the context of its enactment provide, in my respectful opinion, any guidance to us withrespect to the meaning of

section 19, it is imperative that I closely review the very few cases which have dealt with

section 19 or itspredecessor provisions. It is important to note that, other than the cases which I will be examining, nothing has been written aboutsection 19. In effect, the parties were unable to provide us with any

article or case comment dealing with

section 19. Nor has my ownresearch revealed anything in that regard (other than an

article by Brendan Downey et al., “Federalism in the Patch: Canada’s EnergyIndustry and the Constitutional Division of Powers” (2020), 58:2 Alta. L. Rev. 273, where the authors discuss at pages 306 to 311 thecase now before us). Without speculating, I believe that the reason for the absence of any authority on the subject is that the cases heardso far by the Federal Courts and the Supreme Court of Canada were all cases which undoubtedly fell under

section 19. Hence no debatehas arisen concerning the Court’s jurisdiction under

section 19. [55] The cases will show that

section 19 was enacted to allow the Federal Court to deal with controversies of a different nature thanthe one which is now before us. The cases will also show that in every proceeding commenced under

section 19 a province or Canadahad direct standing to commence the proceedings (all of the cases pertain to either suits commenced by Canada against a province or by aprovince against Canada; there are no cases where a province has commenced a suit against another province). Put differently, it is myview that an action commenced under

section 19 is one which pits the Crown against the Crown wherein Crown interests or rights mustbe asserted, which is clearly not the case in this appeal. [56] In examining the meaning of the provision, it is also important to keep in mind that the meaning ascribed to the provision by theJudge leads to results which, in my view, are untenable.

More particularly, the Judge’s reasoning would allow the Federal Court toassume jurisdiction over matters which, I say, neither the provinces nor Canada ever intended to submit to the Federal Court undersection 19. [57] I begin with the Supreme Court’s decision in Attorney-General of Ontario v. Attorney-General of Canada, (1907), 39 S.C.R. 14, (Ontario v. Canada 1907 cited to S.C.R.).

The question then before the Supreme Court can be explained as follows. [58] At the time of Confederation in 1867, the then Province of Canada (Upper and Lower Canada) held assets in the nature of specialfunds in regard to which it was a debtor and liable for interest therein. By

section 111 of the British North America Act, 1867, (U.K.), 30& 31 Vict., c. 3 (U.K.) [R.S.C., 1985, Appendix II, No. 5] (the British North America Act), the Dominion of Canada succeeded to theabove liability. In an arbitration award made in 1870, pursuant to

section 142 of the British North America Act (now the Constitution Act,1867), to adjust the debts and assets of Upper and Lower Canada, the funds were adjudged to be the property of Ontario. Hence, Canadapaid Ontario interest at the rate of 5 percent until 1904.

In that year, Canada claimed to be entitled to reduce the rate of interest to4 percent, or if unacceptable to Ontario, to pay to the province the principal amount. [59] Affirming the decision of the Exchequer Court, the Supreme Court of Canada, Idington J. dissenting, held that following thearbitration award, Canada had the right to pay the principal to the province with any accrued interest thereon and thus to be free from anyliability in respect of the funds. [60] For present purposes, I will only refer to Idington J.’s reasons as he is the only one who dealt with

section 19. At page 44 of thecase report, he indicated that when the rights claimed by the parties were created “there was no court to determine which might be rightor wrong. When we look at it as a case of the Crown against the Crown it is anomalous indeed.” Then at page 45, he referred to section32 of the Exchequer Court Act, R.S.C. 1906, c. 140 (the Exchequer Court Act 1906) (a predecessor of

section 19) and said that it gave theExchequer Court jurisdiction in regard to the determination of the rights arising from the special funds. This led him to write, at pages45 to 46, that

section 32 imposed on the Exchequer Court and on the Supreme Court “in a most drastic manner… the duty of settling thecontroversy whether arising from contract or trust.” [61] The next case which I wish to consider is the Supreme Court’s decision in Ontario v.

Canada 1909, in which the issue before theSupreme Court was whether Ontario was liable to reimburse Canada for expenses incurred by it in order to obtain the surrender of landsoccupied by the Saulteaux Tribe of the Ojibway First Nation (the Band). [62] More particularly, on October 3, 1873, a treaty was entered into between Canada and the Band (the treaty is known as the North-West Angle Treaty No. 3), pursuant to which the band surrendered about 49,300 square miles to Canada in return for financial and othercompensation.

At the time the treaty was entered into, the boundary between Ontario and Manitoba had yet to be determined. However,when the boundary between the two provinces was defined in 1884, 30,500 square miles of the surrendered lands were in Ontario. [63] In 1903, Canada brought a suit in the Exchequer Court pursuant to

section 32 of the Exchequer Court Act 1906 against Ontarioclaiming reimbursement of a percentage of the outlay made in extinguishing Indian title over land now part of Ontario. A majority of theSupreme Court allowed Ontario’s appeal against the decision of the Exchequer Court and thus found that Ontario was not liable toreimburse Canada. [64] Idington and Duff JJ. (with whom Maclennan J. concurred) wrote separate reasons for the majority. At page 101 of the casereport, Idington J. explained that although the language of

section 32 of the Exchequer Court Act 1906 was sufficiently wide to

encompass claims based on “principles of honour, generosity or supposed natural justice,” no one had argued that the Exchequer Courtwas entitled to accept jurisdiction on that basis. He then stated: .…It seemed conceded that we must find a basis for the claim either in a contractual or (bearing in mind that the controversy is theCrown against the Crown for both parties act in the name of the Crown) quasi-contractual relation between the parties hereto or on someground of legal equity.

This is supplemented in the respondent’s factum by an argument resting upon quasi-contracts of the civil law respecting which a long listof authorities is cited. But on argument that law and these authorities did not seem to be pressed. [My emphasis.] [65] Duff J., in his reasons, addressed

section 32 of the Exchequer Court Act 1906, at pages 118 and 119 of the case report. He firststated that the

section granted the Exchequer Court jurisdiction to determine a controversy such as the one before the Court. He thenmade the following remarks: .… I think that in providing for the determination of controversies the Act speaks of controversies about rights; pre-supposing some ruleor principle according to which such rights can be ascertained; which rule or principle could, it should seem, be no other than theappropriate rule or principle of law.

I think we should not presume that the Exchequer Court has been authorized to make a rule of lawfor the purpose of determining such a dispute; or to apply to such a controversy a rule or principle prevailing in one locality when,according to accepted principles, it should be determined upon the law of another locality. This view of the functions of the court underthe Act does not so circumscribe those functions as greatly to restrict the beneficial operation of the statute.

Whatever the right of theDominion in such a case as the present it is difficult to see how the province could (apart from the statute and without its consent givenin the particular case) be brought before any court to answer the Dominion’s claim.

The statute referred to and the correlative statute ofthe province once for all give a legal sanction to such proceedings, and provide a tribunal (where none existed) by which, at the instanceof either of them, their reciprocal rights and obligations touching any dispute may be ascertained and authoritatively declared. [Myemphasis.] [66] The Supreme Court’s decision was appealed to the Privy Council which dismissed the appeal (The Dominion of Canada v. TheProvince of Ontario, (SCC), [1910] UKPC 40, [1910] A.C. 637).

After stating that the Exchequer Court had beengranted jurisdiction by statutes of Canada and of Ontario with respect to controversies between them, Lord Loreburn L.C. made thefollowing statement at page 3 of the case report: .… When differences arise between the two Governments in regard to what is due to the Crown as maker of treaties from the Crown asowner of public lands they must be adjusted as though the two Governments were separately invested by the Crown with its rights andresponsibilities as treaty maker and as owner respectively. [67] I now turn to this Court’s decision in Canada v. P.E.I.

The issue before the Court was whether the federal government was inbreach of one of the terms upon which Prince Edward Island (P.E.I.) had been admitted to Canada pursuant to

section 146 of The BritishNorth America Act, 1867. More particularly, when P.E.I. was admitted to Canada on June 26, 1873, one of the terms of its entry was thatthe “Dominion Government” ensure that a ferry service would, at all times, be established and maintained between P.E.I. and themainland of Canada. [68] By reason of a strike which prevented the ferry service established by Canada from operating between August 21, 1973, andSeptember 2, 1973, P.E.I. commenced an action, pursuant to

section 19 of the FCA, seeking damages and costs against the federalgovernment. [69] Although the Federal Court, Trial Division (Federal Court), found that Canada was in breach of its duty in regard to themaintenance of the ferry service, it concluded that the breach did not give rise to an action for damages. Consequently, P.E.I.’s actionwas dismissed. [70] On appeal by Canada and on cross-appeal by P.E.I. from the Federal Court’s decision, this Court dismissed the appeal andallowed the cross-appeal.

Accordingly, the judgment below was set aside and the matter was returned to the Federal Court for furtherproceedings with respect to the question of damages. [71] Chief Justice Jackett and Le Dain J. wrote for the majority, with Pratte J. dissenting. For present purposes, I will refer only to thereasons given by the Chief Justice and Le Dain J. who both dealt, in the course of their reasons, with

section 19 of the FCA. [72] At pages 543 and 544 of his reasons, the Chief Justice expressed the view that the case before the Court was a matter that clearlyfell within

section 19, i.e. a dispute between Canada and P.E.I. as to whether P.E.I. was entitled to be compensated for the breach of aterm of its entry into Canada. [73] The Chief Justice indicated that the Federal Court had erred in considering the proceedings commenced by P.E.I. as an “action”,as that word was usually understood in the judicial system, whose function was to settle disputes between ordinary persons. He then wenton to examine the question from the standpoint of the nature and character of the

section 19 proceedings. This led him to write, at pages557 to 559: I doubt that either Canada or a province is a person in the sense that it would, as such, be recognized as falling within the jurisdiction of aSuperior Court having the jurisdiction of the common law Superior Courts. In any event, the Trial Division would, in my view, have nojurisdiction in a dispute between two such political entities apart from

section 19 of the Federal Court Act …. … and the “agreeing” provincial Act. In my view, this legislation (section 19 and the provincial “Act”) creates a jurisdiction differing inkind from the ordinary jurisdiction of municipal courts to decide disputes between ordinary persons or between the Sovereign and anordinary person. It is a jurisdiction to decide disputes as between political entities and not as between persons recognized as legal persons

in the ordinary municipal courts. Similarly, in my view, this legislation creates a jurisdiction differing in kind from international courts or tribunals. It is a jurisdiction to decide a dispute in accordance with some “recognized legal principle” (in this case, a provision in the legal constitution of Canada, which is, vis-à-vis international law, Canadian municipal law). The effect of the enactment of the original forerunner of

section 19, once the “agreeing” provincial legislation was passed, was, as I see it, to convert a legal (statutory) right of a “province” without a legal remedy into a legal right with a remedy, albeit a remedy that can be nothing more than a judicial declaration. On this view of the nature of a proceeding under

section 19 , the parties thereto are the political entities , in this case the Province and Canada, which cannot be described any more accurately , as I conceive them, than the peoples or public for the time being of the geographical areas involved . In effect, it is a claim by the people for the time being of Prince Edward Island against the people for the time being of all Canada.

In my view, it does not matter whether such parties are referred to in the proceedings by the geographical names or by reference to the executive governments that represent the inhabitants of the geographical areas and that must be their spokesmen for the purposes of the dispute. [My emphasis; footnotes omitted.] [ 74 ] In a footnote, number 40 on page 559 of his reasons, the Chief Justice further stated that: 40 While describing the executive government as “Her Majesty in right of” may or may not be particularly appropriate, there is no question, reading the proceedings in the light of

section 19 , that it is the Province and Canada that are the true parties to the dispute …. [ 75 ] I now turn to the reasons of Le Dain J. of relevance are pages 582 to 583 where he says: Prince Edward Island invokes the jurisdiction of the Federal Court to determine a controversy between Canada and a province which is conferred by

section 19 of the Federal Court Act … … The Province adopted the necessary enabling legislation for purposes of this jurisdiction in 1941 by the Judicature Act Amendments, 1941 …, The constitution of Canada, of which the Order in Council admitting Prince Edward Island into the Union forms part, attributes rights and obligations to Canada and the Provinces as distinct entities, however these entities and their precise relationship to such rights and obligations should be characterized.

Section 19 of the Federal Court Act and the necessary provincial enabling legislation create a jurisdiction for the determination of controversies between these entities, involving such rights and obligations among others.

Like the Chief Justice, I am, with respect, of the opinion that neither the doctrine of the indivisibility of the Crown nor that of Crown immunity, whether processual or substantive, should be an obstacle to a determination of intergovernmental liability under this provision, which clearly contemplates that Canada and the provinces are to be treated in law as separate and equal entities for purposes of the determination of a controversy arising between them.

The term “controversy” is broad enough to encompass any kind of legal right, obligation or liability that may exist between governments or their strictly legal personification . It is certainly broad enough to include a dispute as to whether one government is liable in damages to another . It is not clear whether the judicial power conferred by

section 19 includes the power to award consequential as well as declaratory relief, but I assume, given the nature of the parties to a controversy, that what was contemplated was a declaration. The proceedings in the present case are brought as an action for damages by Her Majesty the Queen in the right of Prince Edward Island against Her Majesty the Queen in the right of Canada but since the proceedings are clearly intended to invoke the jurisdiction of the Court under

section 19 the style of cause and the nature of the relief sought are in my respectful opinion matters of form that should not be permitted to defeat the substance and merits of the claim. I can see no reason why the proceedings should not be treated broadly as a claim for a determination or declaration by the Court that the Province is entitled to be compensated in damages for the alleged breach of duty by Canada. [My emphasis.] [ 76 ] The next decision worthy of consideration is that of this Court in Canada v. Quebec (Attorney General) , 2008 FCA 201 , 381 N.R. 298 ( Canada v. Quebec ). In that case, at the invitation of Canada, Quebec commenced proceedings under

section 19 of the FCA . Although six questions for determination were before the Federal Court, on appeal, the parties agreed that only three questions should be addressed by this Court. These questions are described by Hugessen J. in an order dated September 5, 2001, as follows: [translation] Did the Minister of Finance of Canada (the Minister) make a reviewable error in his findings, namely 1 - that the adoption of the Act to Amend the Retail Sales Tax Act and other fiscal legislation to make it possible to apply the QST to the GST is not a change made by Quebec to its tax structure within the meaning of paragraph 6(1)(

b) of the Act and subparagraph 12(1)( b )(

i) of the Regulations for the 1991-1992 fiscal year; 2 - that the increased mark-up of the SAQ for the 1991-1992 fiscal year is not an increase in the mark-up on goods sold to the public by that agency within the meaning of paragraph 6(1)(

b) of the Act and subparagraph 12(1)( b )(viii) of the Regulations for the 1991- 1992 fiscal year; and 3 - that the increased mark-up rate of the Société des loteries et courses du Québec for the 1991-1992 fiscal year is not an increase in the mark-up of goods sold to the public by that agency within the meaning of paragraph 6(1)(

b) of the Act and subparagraph 12(1)( b )(viii) of the Regulations for the 1991-1992 fiscal year. [ 77 ] These questions were the result of Quebec commencing a declaratory action against Canada on October 17, 1995, wherein it challenged the federal Minister of Finance’s decision dated November 29, 1994, to reject its application for a stabilization payment for its revenue for the 1991–1992 fiscal year filed on September 28, 1993.

More particularly, Quebec argued that Canada had failed to recognize the changes it had made to the structure of its taxes, namely the Quebec sales tax, as a result of Canada’s introduction of the new goods and services tax and in challenging the increase and the marks-ups of the Société des alcools du Québec and the Société des loteries et courses du Québec on goods and services sold to the public by Quebec.

[ 78 ] One of the issues which our Court had to decide was the nature of the remedy available under

section 19 of the FCA . After indicating that the Federal Court had concluded that

section 19 proceedings were not applications for judicial review under subsection 18(1) of the FCA but rather proceedings the purpose of which was to determine the merits of the dispute, Létourneau J.A., at paragraph 11 of his reasons, held that the

section did not pertain to administrative disputes between a government and an individual, but rather concerned controversies “between two political entities under the same indivisible Crown.” He further stated, at paragraph 13 of his reasons, that the applicable procedure to a

section 19 proceeding was “dependent on and a function of the true nature of the dispute between the parties.” [ 79 ] Finally, I wish to refer to this Court’s decision in Alberta v. Canada .

In that case, seven First Nations, parties to Treaty No. 7 of 1877, began an action against Her Majesty the Queen in right of Alberta and Her Majesty the Queen in right of Canada for breach of trust and fiduciary obligations. [ 80 ] More particularly, the First Nations argued that they had not relinquished title to Treaty No. 7 land and that they opposed the transfer of lands and rights and resources of that land from Canada to Alberta under the Natural Resources Transfer Agreement , confirmed by the 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]. [ 81 ] In September 2001, a prothonotary of the Federal Court granted Alberta’s motion to be removed as a defendant on the grounds that the Federal Court did not have jurisdiction in regard to the plaintiffs’ claim against it. On December 18, 2003, Canada filed its statement of defence in the Federal Court action. [ 82 ] On March 31, 2010, Canada applied for a stay of the action against it so as to assert a Third Party Claim against Alberta.

Canada did so by way of an action commenced in April 2010 in the Court of Queen’s Bench of that province seeking contribution and indemnity from Alberta with regard to any judgment that might be rendered by the Federal Court against it in favour of the plaintiffs. [ 83 ] Then, on February 18, 2014, Canada sought an order from the Federal Court granting it leave to commence a Third Party Claim against Alberta in that Court, which motion was granted by a prothonotary. That decision was upheld on appeal by a judge of the Federal Court [ Kainaiwa Nation (Blood Tribe) v. Canada , 2016 FC 817 ].

The Judge’s decision was appealed to this Court ( Alberta v. Canada , 2018 FCA 83 , 425 D.L.R. (4th) 366). At paragraph 22 of her reasons for the Court, Gauthier J.A. said as follows: Despite the temptation to give a definite answer to the question of jurisdiction so that Canada could immediately discontinue the Third Action [in the Alberta Courts], I can only conclude that it is not plain and obvious that the Federal Court does not have jurisdiction over the controversy (or “ litige ” in French) between Canada and Alberta on the basis of

section 19 of the FC Act. [ 84 ] After noting at paragraph 24 of her reasons that

section 19 did not apply to controversies between individuals and Alberta, Gauthier J.A. indicated [at paragraph 26] that there appeared to be “no limit as to the type of controversy to which [section 19] would apply.” Further, at paragraph 30 of her reasons, she indicated that

section 19 offered a pragmatic and practical approach to resolve intergovernmental disputes and that it was now clear that the

section provided only concurrent jurisdiction to the Federal Court. By that, she meant that provinces could sue each other in a provincial Superior Court but only “before the defending’s [ sic ] provincial Crown’s courts” (at paragraph 29). [ 85 ] What do these cases stand for and what principles can we deduce from them? The cases clearly show the following. First, they reveal that the controversies to be heard under

section 19 are not “ordinary” disputes between citizens

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