2013 SKCA 79 Date:, 2013 SKCA 79

THE COURT OF APPEAL FOR SASKATCHEWAN Citation: 2013 SKCA 79 Date: 2013-07-19 Between: Docket: CACV2271 Saskatchewan Ministry of Energy and Resources Appellant - and - Areva Resources Canada Inc. Respondent Coram: Cameron, Ottenbreit, and Herauf JJ.A. Counsel: Charita N. Ohashi for the appellant Kurt G. Wintermute for the respondent Appeal:

From: 2012 SKQB 205 Heard: March 26, 2013 Disposition: Appeal Allowed Written Reasons: July 19, 2013 By: The Honourable Mr. Justice Ottenbreit Concurring Reasons: The Honourable Mr. Justice Cameron In concurrence: The Honourable Mr. Justice Herauf CAMERON J.A. [ 1 ] I agree with Mr. Justice Ottenbreit that the question arising out of the decision of the Saskatchewan Ministry of Energy and Resources fell to be judicially reviewed in the Court of Queen’s Bench on the standard of reasonableness, rather than correctness, and that the decision is reasonable. Hence I, too, would allow the appeal.

However, my reasons for concluding that the reasonableness standard should have been employed in the Court of Queen’s Bench differ in some significant respects from those of my colleague, as do my reasons for concluding that the decision is reasonable. This accounts for my concurring reasons. [ 2 ] As my colleague has explained, the Ministry determined the amount of royalty payable by Areva in connection with numerous sales of uranium made by the company. In doing so, the Ministry acted upon an understanding of what a material provision of the royalty regime meant.

In effect, then, the Ministry implicitly interpreted the provision to mean one thing rather than another. [ 3 ] Thus the question that arises out of the decision of the Ministry amounts to a question of law regarding the

interpretation of its enabling legislation. I shall have more to say of this later, because the business of choosing which of the two standards of review to apply in a particular case is heavily dependent upon the nature of the question in issue in the particular case. However, for present purposes this identification of the nature of the question will suffice. 1. The Standard of Review [ 4 ] As noted by Justice Ottenbreit, the Supreme court of Canada, in Dunsmuir v.

New Brunswick , 2008 SCC 9, 2008 SCC 9, [2008] 1 S.C.R. 190, set out the lines of principle according to which the courts are to choose between reviewing an administrative decision on a standard of correctness or on a standard of reasonableness. In so choosing, the court must first ask itself whether current case law has satisfactorily resolved the issue of which of the two standards to employ. If the answer is yes, there is no need to go further.

If the answer is no, the issue must be analysed along the lines of principle set out in Dunsmuir . [ 5 ] In the light of this, Areva submitted that there was no need for such analysis because the issue of which standard of review to employ in a case such as this has already been satisfactorily determined, as it was by the Federal Court of Appeal in Echo Bay Mines Limited v. Canada (Minster of Indian Affairs and Northern Development) , 2003 FCA 270 , 308 N.R. 135. There the Court chose, on an application for judicial review of a Ministerial decision, to review the decision on the standard of correctness.

In that case, as in this, the decision came to rest upon the Minister’s

interpretation of the legislation enabling him and his departmental delegates to determine the amount of royalty payable in connection with the revenue derived from certain mining operations. To this extent that case may be seen to be indistinguishable from this one. In my opinion, however, the two are distinguishable on other grounds. [ 6 ] The decision of the Federal Court of Appeal in Echo Bay Mines predated the decision of the Supreme Court of Canada in Dunsmuir . Dunsmuir , as we know, significantly altered the business of judicial review and the basis upon which the courts are to go about this business.

This serves in general to distinguish Echo Bay Mines from the present case. More importantly, perhaps, the enabling legislation in Echo Bay Mines was silent with respect to a right of appeal from the decision of the Minister, whereas the legislation in this case explicitly denies a right of appeal from the decision of the Ministry. As I shall explain shortly, I regard this to be of considerable significance to the choice of standard of review in this case. For essentially these reasons, then, I think the two cases are distinguishable.

[ 7 ] That said, I note, as did Justice Ottenbreit, that the Federal Court of Appeal has since rendered a number of other decisions (subsequent to Dunsmuir ), in which it applied the standard of correctness in its judicial review of Ministerial decisions grounded in the Minsters’

interpretations of their enabling legislation. The most notable of these is the decision of the Court in Georgia Strait Alliance v. Canada (Minster of Fisheries & Oceans) , 2012 FCA 40 , 427 N.R. 110, 33 Admin. L.R. (5 th ) 243. [ 8 ] As I read the reasons for judgment in Georgia Strait Alliance , the Court there opted to apply the standard of correctness, rather than that of reasonableness, because in its opinion a question of law consisting of the

interpretation of enabling legislation by an administrative agency, other than an adjudicative tribunal empowered in an adversarial context to decide such questions, is subject to judicial review on the standard of correctness in the absence of a privative clause evincing a legislative intention to the contrary. Certainly, the absence of a privative clause in that case weighed significantly in the Court’s choice of the standard of correctness over reasonableness.

This, I think, serves to distinguish that case from this one for the same reason Echo Bay Mines is primarily distinguishable, namely that in the case now before us the enabling legislation explicitly excludes a right of appeal in relation to a decision of the kind made by the Ministry. [ 9 ] Hence, I do not think Echo Bay Mines and Georgia Strait Alliance relieve us of having to conduct the standard of review analysis called for by Dunsmuir. And it is to that matter I now turn. [ 10 ] Dunsmuir tells us that judicial review on the standard of correctness is required in relation to (

i) constitutional questions, (ii) true questions of jurisdiction or vires , (iii) legal questions which are both of central importance to the legal system and beyond the expertise of the decision-maker, and (iv) questions regarding the jurisdictional lines between two or more specialized administrative tribunals. The nature of these questions of law is such as to ultimately require the judicial branch of government to decide them, notwithstanding any indication of the legislative branch to the contrary, and to do so without deference to the decision-maker of first instance. This is so for a variety of reasons.

But we need not concern ourselves with them because the question of law to which the decision of the Ministry gives rise here does not fall within any of these classes of question and, accordingly, does not on this ground invite judicial review on the standard of correctness. [ 11 ] Turning to the standard of reasonableness, Dunsmuir goes on to tell us that this is essentially a deferential standard of review and that deference will usually apply automatically when the question to which a decision of an administrative agency gives rise is one of fact, discretion, or policy, or when the legal and factual issues are so intertwined as to defy ready separation.

The question to which the decision in this case gives rise is not of this kind, at least not in my respectful opinion. Hence, the decision does not attract deference on any of these bases, meaning it does not invite judicial review on the standard of reasonableness on any of these grounds. [ 12 ] Dunsmuir also tells us that, barring the exceptional, a question of law consisting of the

interpretation by an administrative agency of its enabling legislation usually invites a measure of deference on judicial review and thus usually attracts review on the standard of reasonableness. (See, too, Alberta (Information and Privacy Commissioner) v. Alberta Teachers’ Association, 2011 SCC 61 , [2011] 3 S.C.R. 654 at paras. 30 and 34 ). Obviously this is getting close to the mark here, for the question arising out of the decision of the Ministry in this instance constitutes a question of this variety.

Thus the question is more apt to attract judicial review on the basis of deference than otherwise or, put another way, more apt to invite review on the standard of reasonableness than that of correctness. [ 13 ] Deference in this context is the product of a number of notions, including judicial respect, first, for the intention of the legislature in leaving the implementation of a regulatory regime to an administrative agency; second, for the decision-making process in this context; and, third, for the customary familiarity of these agencies with their enabling or home legislation.

This is not to say that deference born of respect requires submission by the courts; it is only to say the courts are cognizant of the need to pay respectful attention to these decisions and the basis upon which they are made or could be made. ( Dunsmuir , at para. 48 ). [ 14 ] That a question concerning the

interpretation by an administrative agency of its enabling legislation constitutes a question of law, I might add, must not in itself be thought to displace the call for deference, or weigh in favour of review for correctness rather than reasonableness. As noted in Dunsmuir : There is nothing unprincipled in the fact that some questions of law will be decided on the basis of reasonableness.

It simply means giving the adjudicator’s decision appropriate deference in deciding whether a decision should be upheld, bearing in mind the factors indicated. [para. 56] [ 15 ] Viewed in the light of the whole of the foregoing, and having regard for a number of more specific considerations drawn from Dunsmuir, I am of the opinion the Ministry’s implicit

interpretation of those provisions of its enabling legislation that are at issue here warrants a measure of deference and thus calls for judicial review on the standard of reasonableness.

[ 16 ] More specifically, I am of the view the standard of reasonableness, rather than that of correctness, constitutes the appropriate standard of choice here in light of (

i) the character of the decision and the context in which it was made; (ii) the nature of the question to which the decision gives rise; and (iii) the denial of a right of appeal regarding that question. In my judgment this choice best accords with legislative intent and adequately suits the purpose of judicial review. (

i) The character of the decision and the context in which it was made [ 17 ] The decision consists of a determination by the Ministry of the amount of annual royalty payable by Areva in connection with numerous sales of uranium made by that company in each of the years 2006 to 2009 inclusive. The Ministry determined the amount in exercise of the powers committed to it through the successive operation of The Crown Minerals Act , the Mineral Disposition Regulations, 1986 , and the Crown Mineral Royalty Schedule, 1986. This

Schedule (which forms part of these Regulations and may be conveniently referred to as the “Royalty Schedule”), contains a comprehensive and technically complex scheme for the determination by the Ministry of the amount of royalty payable in relation to such sales. Some such sales may be made at arm’s length, whereas some may not. The scheme anticipates this and provides for it. [ 18 ] In the case of Areva’s sales, most were made at arm’s length, but some were not. The Ministry’s determination of the royalty payable in connection with the arm’s length sales is not in dispute.

It is only the determination of the royalty payable in relation to the non-arms length sales that is at issue. But since the two are interrelated it is necessary to consider how the Ministry approached the matter as a whole. [ 19 ] Areva was obliged by the provisions of the Royalty

Schedule to pay an annual royalty consisting of prescribed percentages of “the fair market value” of its “gross sales of uranium” in each of the years in issue. The term “gross sales” is defined in section 15(1) of the Royalty

Schedule to mean in general “the aggregate of the sales prices and all other amounts paid or payable to or for the benefit of the royalty payer for uranium.” This term, thus defined, ties in with the terms of

section 27, which provide the bases for determining the fair market value of both arm’s length and non-arm’s length sales. [ 20 ] According to subsection 27(1) of the Royalty Schedule, “the fair market value” for an arm’s length sale of uranium is “the price paid by the purchaser to the royalty payer for the uranium.” Since uranium is customarily sold by the pound, this phrase may be taken to refer to the price per pound paid by the purchaser. So much for an arm’s length sale. As for a sale that is not made at arm’s length (and enters into a pooled inventory as was the case here), subsection 27(3)(

a) deems “the fair market value” to be “the average sale price of all arm’s length sales of uranium in the current royalty year.” [1] [ 21 ] Having regard for the forgoing, and in the circumstances of the case, it fell to the Ministry to apply the provisions of subsection 27(3)(

a) when determining the amount of royalty payable in relation to the sales that were not made at arm’s length. In doing so, I do not think it fell to the Ministry to exercise discretion, inasmuch as the subsection “deems” the fair market value of non-arm’s length sales to be the average sale price of all arm’s length sales. In other words the subsection dictates the measure of the fair market value. Nor do I think it fell to the Ministry to make a policy decision, for the Ministry was directed to implement the policy embodied in the subsection.

Thus, in my respectful opinion the decision of the Ministry is not subject on either of these bases to judicial review on the reasonableness standard. [ 22 ] That being said, it was not possible for the Ministry to apply subsection 27(3)(

a) without first coming to some understanding, at least implicitly, of what was meant by the phrase “the average sale price of all arm’s length sales.” As it turned out, the Ministry in effect took the meaning of this phrase to be self explanatory and went on from there to apply the subsection as follows. Based on Areva’s contracts relating to its arm’s length sales of uranium in any given year the Ministry: • added the revenue derived by the company through these sales • deducted such costs and expenses as were allowable under the Royalty

Schedule and • divided the remaining revenue by the total number of pounds of uranium sold under these contracts to arrive at an average sale price per pound. Having thus determined the average sale price per pound of uranium sold by Areva at arm’s length, the Ministry then calculated the fair market value of the uranium sold by the company in non-arm’s length transactions by applying the average price per pound of all arm’s length sales to the number of pounds that were sold in non-arm’s length transactions. [ 23 ] Step by step, then, the Ministry determined the amount of royalty payable by Areva in any given year by working its way through

the royalty scheme down to the point of dispute, namely the application of subsection 27(3)(

a) of the Royalty

Schedule to the uranium sold in non-arm’s length transactions. To repeat, subsection 27(3)(a), to the extent it applies to the determination under consideration, states that the fair market value for a sale of uranium not made at arm’s length is deemed to be “the average sale price of all arm’s length sales of uranium…”. The Ministry took this phrase to mean one thing; the company took it to mean another. [ 24 ] The judge who heard the application for judicial review in the Court of Queen’s Bench provided a very helpful illustration of the difference.

He said this: 4 Areva and the Ministry calculate "the average sale price of all arm's length sales" differently. The parties' approaches can be illustrated using an example in which a producer, in a given year, has arm's length sales of uranium under three contracts as follows: • Contract 1 is for the sale of 1,000 pounds of uranium at $50 per pound. • Contract 2 is for the sale of 2,000 pounds of uranium at $40 per pound. • Contract 3 is for the sale of 3,000 pounds of uranium at $60 per pound. 5 Areva calculates the average sale price by adding $50, $40 and $60 and dividing by 3 ($150/3 = $50).

Areva says that the result, $50 per pound, is the average sale price of all arm's length sales - the average of the three contract sale prices. 6 The Ministry calculates the average sale price by first determining the total revenue for the uranium sold ($50,000 + $80,000 + $180,000 = $310,000). The Ministry then divides that total by the number of pounds sold ($310,000/6,000 = $53.33).

The Ministry says that the result, $53.33 per pound, is the average sale price of all arm's length sales - the weighted average sale price of all arm's length sales, as the Ministry puts it. [ 25 ] In sum, then, this is the character of the decision made by the Ministry, the context in which it was made, and the issue that divided the parties. (ii) The nature of the question to which the decision gave rise [ 26 ] The question arising out of the Ministry’s decision was identified in the Court of Queen’s Bench as a question of law consisting of the

interpretation of the phrase “the average sale price of all arm’s length sales of uranium” found in subsection 27(3)(

a) of the Royalty Schedule. I agree with this identification of the question. I note, however, that the Ministry, when making the determination of the amount of royalty payable in connection with non-arm’s length sales, did not expressly interpret the meaning of this phrase; the Ministry in effect merely acted upon its understanding of what the phrase meant. In doing so, however, the Ministry may be seen to have implicitly interpreted the meaning of this phrase, and to have done so in the context of applying the whole of the relevant provisions of the Royalty

Schedule to the facts of the situation. [ 27 ] I do not suggest this alters the nature of the question. But I do want to emphasize that the Ministry implicitly interpreted the provisions in issue, and did so in the context of applying the relevant provisions of the royalty scheme as a whole. As I said earlier, this is a comprehensive and technically complex scheme. Indeed the Royalty

Schedule as a whole is so technically complex as to make it exceedingly difficult for anyone unfamiliar with the uranium industry to fully comprehend it. The Ministry, of course, is called upon day to day to work with the scheme, and clearly possesses a level of understanding of the uranium industry and the royalty regime that far surpasses the understanding of others not familiar with the industry. [ 28 ] My point is this. As Dunsmuir tells us, the courts usually accord a measure of deference to the

interpretation by administrative agencies of the legislation enabling them to carry out their assigned functions. The courts do so by employing the standard of reasonableness, rather than correctness. As mentioned above, this is a practice born in significant part of respect for the intention of the legislature in committing administrative decision making to administrative agencies. It is also rooted in significant

part in the recognition by the courts that “in many instances those working day to day in the implementation of frequently complex administrative schemes have or will develop a considerable degree of expertise or field sensitivity to the imperatives and nuances of the legislative regime.” ( Dunsmuir at para 49 quoting D.J. Mullan, “Establishing the Standard of Review: The Struggle for Complexity?” (2004), 17 C.J.A.L.P. 59 at p. 93). There are exceptions to this, but none do here apply. [ 29 ] What all of this suggests to me is that a deferential approach is appropriate here.

So, too, does the fact there is no right of appeal in relation to the decision of the Ministry in this instance. Indeed, the Legislature expressly chose to deny such right of appeal. This is a matter of considerable import, bearing in mind the degree of respect the judicial branch of government customarily accords the intention of the legislative branch in this regard, so the matter merits further elaboration.

(iii) The denial of a right of appeal . [ 30 ] As Justice Ottenbreit observed, subsection 16(1) of The Crown Minerals Act grants a person required to pay a royalty a right of appeal to the Board of Review Commissioners. This right of appeal extends to “any determination made by the Minister of the amount of royalty payable, or of any factor or component that must be determined in order to calculate that amount.” Were it not for subsection 16(1.3) of the Act , which goes on to limit this right of appeal, the right would have extended to the decision made by the Ministry in this instance.

But, as it is, this is not the case. [ 31 ] Subsection 16(1.3) explicitly denies a right of appeal in relation to “any part of a determination respecting the price of a mineral made by or pursuant to the regulations” the Lieutenant Governor in Council is empowered to make on the authority of subsection 22(1.1) (

g) of the Act . The regulation in issue, namely that found in subsection 27(3)(

a) of the Royalty Schedule, was made on this authority, at least on the reckoning of each of the parties, both of which advanced their arguments on this basis. [ 32 ] This denial of a right of appeal obviously signifies an intention in the Legislature to leave matters of the kind covered by subsection 16(1.3) of the Act to the Ministry to determine, and to do so to the exclusion of the Board of Revenue Commissioners or, for that matter, the courts.

In my judgment this amounts to a strong indication, in keeping with Dunsmuir , that decisions by the Ministry regarding matters of this kind should be judicially reviewed on the standard of reasonableness. [ 33 ] Indeed, based on this indication, combined with those already mentioned, I am satisfied Areva’s application for judicial review of the decision of the Ministry should have been determined in the Court of Queen’s Bench on the standard of reasonableness rather than that of correctness. [ 34 ] I see no reason, I might add, for supposing that employing the standard of reasonableness in this instance is not adequate to achieving the purpose of judicial review.

Judicial review of administrative decision-making constitutes the means by which the courts, concerned to uphold the rule of law, supervise those who exercise statutory power in order to ensure they do not overstep the bounds of their legal authority. In my opinion there is no need here to hold the Ministry to a more stringent standard than that of reasonableness.

Nor is there any call to do so, given the degree of respect the courts ordinarily accord legislative intent, for the standard of reasonableness is sufficient to ensure the Ministry does not stray beyond the limits of the authority entrusted to it by the Legislature. As Dunsmuir reminds us (at para. 27 ), the courts must be sensitive not only to the need to uphold the rule of law but also the need to avoid “undue interference” with the discharge of administrative functions delegated to administrative agencies by Parliament or the legislatures. 2.

The Reasonableness of the Decision [ 35 ] Whether a decision made by an administrative agency is reasonable or unreasonable is ordinarily assessed with reference to both the coherence of the reasons for the decision (in the sense of justification, transparency, and intelligibility), and whether the outcome falls within an acceptable range. In this case the Ministry, not being an adjudicative tribunal in the usual sense, did not explain the reasons why it ascribed to the phrase in issue the meaning it did.

As remarked upon earlier, the Ministry in effect took the meaning of the phrase “the average sale price of all arm’s length sales of uranium” to be self explanatory. On the face of things this appears to make for some difficulty in assessing the decision in terms of the coherence of the reasons for it. [ 36 ] That being said, after Areva launched its application for judicial review, the Ministry filed an affidavit explaining why in its view the phrase should command the meaning the Ministry had implicitly attributed to it.

This is an after-the-fact explanation, and as might be expected the affidavit is largely argumentative in this regard. But that need not detain us, because Dunsmuir makes the point that deference, as respect for the decision-making process, requires “a respectful attention to the reasons offered or which could be offered in support of a decision.” ( Dunsmuir at para. 48 quoting from “The Politics of Deference: Judicial Review and Democracy” in M.

Taggart, ed., The Province of Administrative Law (1997), 279 at p. 286). [ 37 ] I note in this connection that the Supreme Court of Canada recently faced a similar situation in Agraira v. Canada (Minister of Public Safety and Emergency Preparedness) , 2013 SCC 36 . There the Minister made a decision that came to rest on his implicit

interpretation of a phrase contained in the applicable provisions of the enabling legislation. Mr. Justice LeBel, who delivered the judgment of the Court in that case, held that in these circumstances the courts may “consider the reasons that could be offered for the [Minster’s] decision when conducting a reasonableness review” of that decision: (para 58, quoting Alberta (Information and Privacy Commissioner) v. Alberta Teacher’s Association , supra , at para. 54).

[ 38 ] Justice LeBel then went on to assess the reasonableness of the Minister’s implicit

interpretation of the enabling legislation on the basis of Driedger’s modern approach to statutory

interpretation, which is this: Today there is only one principle or approach, namely the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament. I would employ the same approach in the case before us, which is to say I would assess the reasonableness of the Ministry’s implicit

interpretation of the phrase in issue on this contextual basis. [ 39 ] With that in mind, I again observe that the Royalty

Schedule requires the payment of an annual royalty consisting of prescribed percentages of the “fair market value” of the royalty payer’s “gross sales of uranium” in any given year. (Sections 24 and 25). Subject to

section 26, which provides that “the sale price” of uranium is equal to the fair market value determined in accordance with

section 27, the term “gross sales” is defined in

section 15 to mean “the aggregate of the sale prices and all other amounts paid or payable to or for the benefit of royalty payer for uranium.” [ 40 ]

Section 27, as we saw earlier, stipulates in subsection (1), that the fair market value for an arm’s length sale of uranium is “the price paid by the purchaser to the royalty payer for the uranium.” And subsection 27(3)(

a) deems the fair market value of uranium that enters a pooled inventory, as was the case here, to be “ the average sale price of all arm’s length sales of uranium” from that pooled inventory. [ 41 ] Read in this legislative context (and in the context of the fact uranium is customarily sold by the pound), the phrase “the average sale price of all arm’s length sales of uranium” is reasonably capable, in my judgment, of bearing the meaning implicitly ascribed to it by the Ministry in determining the fair market value of the uranium not sold at arm’s length by Areva. Expressed in the negative, the Ministry’s

interpretation cannot be seen to be unreasonable when viewed in this light. [ 42 ] Had it been necessary to determine whether the Ministry correctly interpreted this phrase, I would have been inclined to examine the matter more closely. But, since we are concerned not with the correctness but the reasonableness of the

interpretation in light of the reasons that could be offered in support of it, I think this is sufficient. I do want to add, however, that I regard the outcome of the Ministry’s

interpretation and resulting application of subsection 27(3)(

a) of the Royalty

Schedule to fall with the acceptable range of possibilities. [ 43 ] For the whole of these reasons, then, I too would allow the appeal with costs to the appellant. Dated at Regina, Saskatchewan, this “19 th ” day of July 2013. “Cameron J.A.” Cameron J.A. I concur. “Herauf J.A.” Herauf J.A. OTTENBREIT J.A. I. Introduction [ 44 ] Areva Resources Canada Inc. brought a judicial review application to quash the determination by the Saskatchewan Ministry of Energy and Resources of “average sales price”.

The Ministry used that determination as a part of its determination of fair market value for the purpose of calculating royalty payments in relation to Areva’s non-arm’s length sales of uranium for the years 2006 to 2009 inclusive pursuant to The Crown Mineral Royalty Schedule, 1986 (the “

Schedule ”). The Queen’s Bench Chambers judge concluded that the way the Ministry interpreted and calculated the term “average sales price” as set forth in the legislation was incorrect and must be set aside and the matter be remitted back to the Ministry for recalculation in accordance with the methodology advocated by Areva. The Ministry appeals that decision. The Chambers judge, despite his decision, determined that if the standard of review to be applied to the Ministry’s decision is reasonableness, then the decision was nevertheless reasonable. Areva cross-appeals that determination.

[ 45 ] For the reasons which I will explain, the Ministry’s appeal is allowed and Areva’s cross-appeal is dismissed. II. Facts and Background [ 46 ] Areva operates as a uranium exploration, mining and milling company in Canada with substantial uranium assets in the Province of Saskatchewan.

Areva is a wholly owned subsidiary of Areva NC, a France-resident corporation which is a subsidiary of Areva SA, part of a larger multi-national group of companies known as the Areva Group. [ 47 ] Areva is obliged to pay yearly royalties to the Crown on the sale of uranium in accordance with The Crown Minerals Act , S.S. 1984-85-86, c. C-50.2 (the “ Act ”), which requires the royalty to be calculated in accordance with The Mineral Disposition Regulations, 1986 , Sask.

Reg. 30/86 (the “ Regulations ”) on gross sales subject to certain adjustments. [ 48 ] The Ministry conducted audits in relation to Areva’s annual uranium royalty returns for the years 2006 through 2009. For this purpose, the Ministry requested actual supporting information from Areva NC on Areva’s non-arm’s length sales for the years in question but none was provided. In the absence of the requested information, the Ministry chose to employ the calculation method set forth at s. 27(3)(

a) of the

Schedule , using Areva’s arm’s length sales in order to calculate the fair market value for the non-arm’s length sales for the purpose of the royalty calculation. Section 27(3)(

a) reads as follows: 27(3) Subject to

section 28 and subsection (5), the fair market value for a sale of uranium that is not at arm’s length is deemed to be: (

a) in the case of uranium that enters into a pooled inventory, the average sale price of all arm’s length sales of uranium from that pooled inventory in the current royalty year; [ 49 ] In due course, the Ministry provided Areva with its decision for the 2006 through 2009 audits. For this purpose, the Ministry had calculated the “average sales price” of all arm’s length sales of uranium as required by s. 27(3)(

a) of the

Schedule using a method which divided the total revenue of all contracts by the total number of pounds of uranium sold by those contracts which resulted in an average sales price per pound. This was then multiplied by the number of pounds sold non-arm’s length to arrive at a “gross sales” figure (subject to adjustments in accordance with the

Schedule ) upon which the royalty was calculated. [ 50 ] Areva disagreed with the Ministry’s methodology and contended that the correct approach to determining the “average sales price” as required by the

Schedule was to add the per pound contract prices under each contract and divide that sum by the number of contracts regardless of the number of pounds sold in each contract. That resulting average sales price per pound was then multiplied by the number of pounds sold non-arm’s length to arrive at a “gross sales” figure for the purpose of the royalty calculation. III. The Decision of the Court Below [ 51 ] The Chambers judge reviewed the governing case on standard of review, Dunsmuir v. New Brunswick , 2008 SCC 9 , [2008] 1 S.C.R. 190.

After reviewing the factors germane to determining which standard of review was applicable, he stated: 26 The Ministry was interpreting its own statute. As I have discussed, though, the Ministry does not have particular familiarity with the subject of the decisions. The

interpretation of “the average sale price of all arm’s length sales” is outside the Ministry’s area of expertise. This consideration does not favour deference. Conclusion as to standard of review 27 The most influential of the factors to consider in determining the standard of review is the matter of the expertise of the decision maker. In this case that factor is determinative. For the above reasons, I conclude that the standard of review is correctness. [ 52 ] In analysing whether the Ministry’s decision was correct, the Chambers judge said: 33 In contemplating this

interpretation I note the inclusion, in other parts of the Schedule, of references to quantity of uranium. This inclusion means that the governor-in-council, in drafting the Schedule, was aware of that factor. The governor-in-council, though, did not see fit to specify a reference to quantity in s. 27(3). 34 This

interpretation of s. 27(3)(

a) has the value of representing the plain meaning of the words as written. In contrast, the

interpretation advanced by the Ministry requires reading an extra factor into the subsection. Mr. Wog describes the Ministry’s calculation as being “the average based on the weighted actual price per pound of uranium sold”. The Ministry’s approach requires reading into s. 27(3)(

a) the additional factor of weighting. 35 Nowhere in s. 27(3)(

a) is there a direction to introduce weighting into the average. There is no direction to factor the total revenue under each contract, and to add the total number of pounds of uranium sold, and only then to perform the division process that

results in an average. Such an exercise is not suggested by the wording of s. 27(3)(a). The wording of s. 27(3)(

a) suggests, instead, that “the average sale price of all arm’s length sales” means “the average of the contract sale prices”. ... 39 Areva argues that this circumstance means that the Ministry’s approach to calculating “average sale price” is incorrect, and further that there can be no logic or reason to the Ministry’s

interpretation of s. 27(3)(a). I am not persuaded that this circumstance means that there is no logic or reason to the Ministry’s approach.

The circumstance, however, does support the conclusion (suggested by the plain meaning of the words in s. 27(3)(a)) that there is no reason to read an extra factor into the subsection by inserting the factor of weighting, which reflects quantity. ... 41 The governor-in-council having selected and specified what items are to be averaged to reach the deemed fair market value, there is no room for using a different set of items, even if a persuasive argument can be made that doing so would be more accurate and fair. 42 For the above reasons I conclude that the Ministry’s

interpretation is not correct. The correct

interpretation of s. 27(3)(

a) is that “the average sale price of all arm’s length sales” means “the average of the contract sale prices”, as suggested by Areva, not “the weighted average sale price” as suggested by the Ministry. [ 53 ] The Chambers judge went on to determine whether the decision of the Ministry was, nevertheless, reasonable and said: 44 If the standard of review in this matter were reasonableness, I would conclude that the Ministry’s decisions fall into the category of reasonableness and should not be set aside. As is evident from the above discussion, I find the Ministry’s

interpretation to be justified, transparent and intelligible. There is logic and reason to it. One can follow the reasoning process of the Ministry in applying this

interpretation. 45 Further, the results of the Ministry’s decisions fall into an acceptable range. In part, this conclusion is demonstrated by the fact that for some years the Ministry’s approach results in a higher average price than does Areva’s approach, but for other years the Ministry’s approach results in a lower average price than does Areva’s approach. [ 54 ] The Chambers judge concluded: 55 The decisions of the Ministry must be set aside, and the matter remitted to the Ministry for calculation in accordance with the correct approach.

Since I will make such an order, and since this is not a matter of the Ministry refusing or neglecting to make the calculation, there is no need for an order by way of mandamus . This is a matter of whether the calculation was performed correctly, a matter that can be addressed fully with the order by way of certiorari . 56 I order that: … (

b) The subject of the decisions and notices are remitted to the Ministry for recalculation of those royalties so that, in calculating the fair market value under s. 27(3)(

a) of the Schedule, the average sale price of all arm’s length sales is the average of the contract sale prices rather than the weighted average sale price. IV. Standard of Review [ 55 ] The standard of review to be applied in an appeal of a judicial review decision is correctness in relation to both the standard of review chosen and the application of that standard ( Westfair Foods Ltd. v. U.F.C.W., Local 1400 , 2006 SKCA 8 , 263 D.L.R. (4 th ) 397). V. Issues [ 56 ] The issues on both the Ministry’s appeal and the cross-appeal of Areva can be stated as follows: 1.

Did the Chambers judge err in concluding that the standard of review to be applied to the decisions under review was correctness?

2. Did the Chambers judge err in concluding that the correct

interpretation of s. 27(3)(

a) of The Crown Mineral Royalty Schedule, 1986 is that “the average sale price of all arm’s length sales” means “the average of the contract sales prices”? 3. Did the Chambers judge err in concluding that the Ministry’s

interpretation of s. 27(3)(

a) of The Crown Mineral Royalty Schedule, 1986 was reasonable? 4. Did the Chambers judge err in directing the Ministry to recalculate the royalties due for the years 2006 through 2009 by utilizing “the average of the contract sales prices” as the basis of fair market value under s. 27(3)(

a) of The Crown Mineral Royalty Schedule, 1986 ? VI. Relevant Legislation [ 57 ] The following legislation is germane to the issues: The Crown Minerals Act 3(2) From and after the day this Act comes into force, no right to or interest in any Crown mineral or any Crown mineral lands shall be granted to or acquired by any person from the Crown except under a Crown disposition issued by the minister under this Act. … 4 Subject to the provisions of this Act and the regulations, the minister may issue Crown dispositions: (

a) to any person who has complied with the requirement therefor in accordance with the regulations; (

b) with respect to any Crown minerals or Crown mineral lands that are withdrawn pursuant to

section 21 and where the minister determines it to be in the public interest, by agreement or lease entered into with any person on terms and conditions approved by the Lieutenant Governor in Council; … 9(1) Any Crown disposition may be cancelled by the minister if there has been a breach by the holder of any of the provisions of the Crown disposition or any of the provisions of this Act or the regulations relating to the Crown disposition. … 10 Where the cancellation pursuant to

section 9 or any loss of rights has occurred with respect to any Crown disposition, the minister may make an order, on such terms as he deems just, granting relief from the cancellation or loss of rights, and on compliance with the terms, if any, so imposed, the rights cancelled or lost shall be revested in the person so relieved but subject to any intervening right of any person arising subsequent to the cancellation and loss of rights and prior to the order of the minister. … 13 Except as may be permitted by the regulations or under the authority of and in accordance with a Crown lease, no Crown minerals shall be extracted, recovered or produced from any Crown mineral lands. … 16(1) A person who is required to pay a royalty and who objects to any determination made by the minister of the amount of royalty payable, or of any factor or component that must be determined in order to calculate that amount, may appeal the determination within 90 days after the day on which the notice of the determination is mailed to that person pursuant to the regulations. …

(1.2) A person may appeal by delivering to the Board of Revenue Commissioners, either personally or by registered mail, written notice of the appeal setting out:

(

a) the reasons for the objections to the determination; and (

b) the allegations of fact and law on which the person appealing relies to support the objections to the determination.

(1.3) A person may not appeal any part of a determination respecting the price of a mineral made by or pursuant to the regulations made pursuant to clause 22(1.1)(

g) for the purpose of calculating the royalty. … 22(1.1) The Lieutenant Governor in Council, respecting royalties that are excepted and reserved to the Crown under a Crown lease, may make regulations: … (

g) providing that the price to be used in calculating a royalty may be a price other than the price that has been or will be received for the mineral, including: (

i) a price equal to a fair market value of the mineral; (ii) where the price is respecting natural gas, an average price; (iii) a minimum price determined in the manner specified in the regulations; (iv) a price determined by including other amounts that have been or will be received; (

v) a price determined by deducting fees, charges or other factors specified in the regulations; … 27.1(1) If, in the opinion of the minister, the result of one or more acts, agreements, arrangements, transactions or operations is to unduly or artificially reduce the liability for royalty payments under this Act , the minister may calculate the royalty as if the act, agreement, arrangement, transaction or operation had not occurred.

(2) For the purposes of subsection (1), the minister may estimate the amount of royalty that would have been payable had the act, agreement, arrangement, transaction or operation not occurred.

The Mineral Disposition Regulations, 1986 3 These regulations are subject to any orders made by the minister under the Act . … 85(1) The minister shall have the power to determine from time to time any questions that may arise in determining the amount of the royalty payable pursuant to a lease in any particular case including, without restricting the generality of the foregoing, power to settle the amount allowable as deductions for the purpose of determining the income derived from mining operations or gross sales or operating profits. The Crown Mineral Royalty Schedule, 1986

14 This Part applies to the calculation and payment of royalties with respect to uranium sold or consumed on and after January 1, 2001, whether or not the uranium was produced in Saskatchewan from Crown mineral lands prior to that date. 15(1) In this Part: (a) “basic royalty” means the basic royalty described in

section 24; … (h) “gross sales” means, subject to

section 26, the aggregate of the sales prices and all other amounts paid or payable to or for the benefit of the royalty payer for uranium; … (j) “kilograms of U 3 O 8 ” means the weight of uranium, in any chemical form, that is expressed in terms of the equivalent weight in kilograms of natural uranium concentrates triuranium octoxide, also known as U 3 O 8 ; … 21(1) Every royalty payer shall remit a royalty payment in accordance with these regulations for all uranium sold or consumed by the royalty payer. … 23 The royalty payment to be made pursuant to

section 21 is the amount A calculated in accordance with the following formula: A = B + C ​ D where: A is the royalty payable; B is the basic royalty payable; C is the tiered royalty payable; and D is the Saskatchewan resource credit. 24 The basic royalty is 5% of the royalty payer’s gross sales of uranium. 25(1) The tiered royalty payment is the amount A calculated in accordance with the following formula: A = B + C + D ​ E where: A is the tiered royalty;

B is the amount determined in accordance with subsection (2); C is the amount determined in accordance with subsection (3); D is the amount determined in accordance with subsection (4); and E is any small producer credit that has been claimed. (2) 15% of the lesser of: (

a) the gross sales of the royalty payer, adjusted pursuant to

section 36, less the product of: (i) $60; (ii) the index value; and (iii) the weight of uranium in kilograms of U 3 O 8 sold or consumed by the royalty payer; and (

b) the value determined in accordance with clause (a), less the capital recovery bank deduction that must be claimed. … 26(1) For the purposes of determining the gross sales of a royalty payer: … (

b) the sale price of the uranium is equal to the fair market value determined in accordance with

section 27 less any of the following that have been approved by the minister: (

i) the cost of transporting the uranium from the royalty payer’s mill or the mill that processed the royalty payer’s uranium, to the first point of sale; (ii) expenses incurred by the royalty payer for the conversion of the uranium concentrate to a form further refined than the compound produced at the mill and described in terms of kilograms of U 3 O 8 ; and (iii) any other sale price deductions the minister considers appropriate in the circumstances. … 27(1) Subject to subsection (2), the fair market value for an arm’s length sale of uranium is the price paid by the purchaser to the royalty payer for the uranium. …

(3) Subject to

section 28 and subsection (5), the fair market value for a sale of uranium that is not at arm’s length is deemed to be: (

a) in the case of uranium that enters into a pooled inventory, the average sale price of all arm’s length sales of uranium from that pooled inventory in the current royalty year;

(

b) in the case of uranium that is re-sold in an arm’s length sale without entering a pooled inventory, the sale price of the uranium in the first arm’s length sale; and (

c) in the case of uranium that is sold and subsequently consumed, the average sale price for all sales of uranium from the royalty payer to arm’s length purchasers in the current royalty year. … 28(1) Notwithstanding

section 27, if, in the minister’s opinion, the sales price to be included in the calculation of the gross sales of the royalty payer does not accurately reflect the fair market value, and it is not possible to determine the fair market value in accordance with

section 27, the minister may deem a value that, in the minister’s opinion, accurately reflects the fair market value. … 36(1) Sales of uranium will not be subject to tiered royalties if: (

a) the sales are from a facility that is not eligible to establish a capital recovery bank pursuant to subclause 17(b)(ii); or (

b) the sales are from a secondary source of previously processed material that the minister considers appropriate in the circumstances. … 39(1) Notwithstanding subsections 37(2) to (4), and subject to subsection 37(5), the minister may recognize the allocation of the capital recovery bank between the vendor and purchaser as set out in the contract.

(2) The minister shall not recognize the allocation of the capital recovery bank set out in the contract unless: (

a) an interest in a facility is disposed of by a royalty payer to a person who is or becomes a royalty payer; and (

b) the vendor continues to be a royalty payer.

(3) Where the minister is satisfied that the allocation set out in the contract is reasonable, the minister shall provide written approval of the relevant sections of the contract to the vendor and the purchaser.

(4) Notwithstanding anything else in this section, the minister may determine the allocation of the capital recovery bank between the vendor and purchaser where the minister is not satisfied that the allocation set out in the contract is reflective of: (

a) the percentage interest of the vendor in the facility that was disposed of; or (

b) the purchase price of the facility disposed of. VII. Analysis [ 58 ] The primary issue in this case is what standard of review is applicable to the Minister’s decision. Accordingly, I begin with a review of the germane jurisprudence.

(

a) Governing law regarding standard of review [59] Since Dunsmuir there are two standards of review; correctness and reasonableness and an analytical protocol with respect todetermining which applies. The Supreme Court of Canada in Agraira v. Canada (Public Safety and Emergency Preparedness), 2013SCC 36, has recently explained this: 48 As this Court held in Dunsmuir, a court deciding an application for judicial review must engage in a two-step process to identifythe proper standard of review.

First, it must consider whether the level of deference to be accorded with regard to the type of questionraised on the application has been established satisfactorily in the jurisprudence. The second inquiry becomes relevant if the first isunfruitful or if the relevant precedents appear to be inconsistent with recent developments in the common law principles of judicialreview. At this second stage, the court performs a full analysis in order to determine what the applicable standard is. [60] How to determine which is appropriate was explained in Smith v.

Alliance Pipeline, 2011 SCC 7, [2011] 1 S.C.R. 160: 25 Accordingly, reviewing judges can usefully begin their analysis by determining whether the subject matter of the decision beforethem for review falls within one of the non-exhaustive categories identified by Dunsmuir. Under that approach, the first step will sufficeto ascertain the standard of review applicable in this case. 26 Under Dunsmuir, the identified categories are subject to review for either correctness or reasonableness.

The standard ofcorrectness governs: (1) a constitutional issue; (2) a question of “general law ‘that is both of central importance to the legal system as awhole and outside the adjudicator’s specialized area of expertise’” (Dunsmuir, at para. 60 citing Toronto (City) v. C.U.P.E., Local 79,2003 SCC 63, [2003] 3 S.C.R. 77, at para. 62); (3) the drawing of jurisdictional lines between two or more competing specializedtribunals; and (4) a “true question of jurisdiction or vires” (paras. 58-61). On the other hand, reasonableness is normally the governingstandard where the question: (1) relates to the

interpretation of the tribunal’s enabling (or “home”) statute or “statutes closely connectedto its function, with which it will have particular familiarity” (para. 54); (2) raises issues of fact, discretion or policy; or (3) involvesinextricably intertwined legal and factual issues (paras. 51 and 53-54). [61] The categories described above can be considered to be initial presumptions as to standard of review. However, a case may notreally fall within either of the non-exhaustive categories identified by Dunsmuir as a starting point.

Where further analysis is necessary,the Court in Dunsmuir said: 64 The analysis must be contextual. As mentioned above, it is dependent on the application of a number of relevant factors,including: (1) the presence or absence of a privative clause; (2) the purpose of the tribunal as determined by

interpretation of enablinglegislation; (3) the nature of the question at issue, and; (4) the expertise of the tribunal.

In many cases, it will not be necessary toconsider all of the factors, as some of them may be determinative in the application of the reasonableness standard in a specific case. [62] With respect to the reasonableness standard, the Court said the following: 55 A consideration of the following factors will lead to the conclusion that the decision maker should be given deference and areasonableness test applied: - A privative clause: this is a statutory direction from Parliament or a legislature indicating the need for deference. - A discrete and special administrative regime in which the decision maker has special expertise (labour relations for instance). - The nature of the question of law.

A question of law that is of “central importance to the legal system ... and outside the ...specialized area of expertise” of the administrative decision maker will always attract a correctness standard (Toronto (City) v. C.U.P.E.,at para. 62). On the other hand, a question of law that does not rise to this level may be compatible with a reasonableness standard wherethe two above factors so indicate. [63] The nature of the question which will raise the presumption of a reasonableness standard of review has been recently described inNor-Man Regional Health Authority Inc. v.

Manitoba Association of Health Care Professions, 2011 SCC 59, [2011] 3 S.C.R. 616: 36 The standard of reasonableness, on the other hand, normally prevails where the tribunal’s decision raises issues of fact, discretionor policy; involves inextricably intertwined legal and factual issues; or relates to the

interpretation of the tribunal’s enabling (or “home”)statute or “statutes closely connected to its function, with which it will have particular familiarity” (Dunsmuir, at paras. 51 and 53-54;Smith, at para. 26). [64] Respecting the concept of relative “expertise in the subject matter” which may be a factor pointing to a reasonableness standard ofreview, the Court in Dunsmuir cited Dr. Q. v. College of Physicians and Surgeons, 2003 SCC 19, [2003] 1 S.C.R. 226: 29 Relative expertise can arise from a number of sources and can relate to questions of pure law, mixed fact and law, or fact alone.

The composition of an administrative body might endow it with knowledge uniquely suited to the questions put before it and deferencemight, therefore, be called for under this factor: Pezim v. British Columbia (Superintendent of Brokers), (SCC), [1994]2 S.C.R. 557, at pp. 591-92. For example, a statute may call for decision-makers to have expert qualifications, to have accumulatedexperience in a particular area, or to play a particular role in policy development: Mattel, supra, at paras. 28-31. Similarly, an

administrative body might be so habitually called upon to make findings of fact in a distinctive legislative context that it can be said tohave gained a measure of relative institutional expertise: e.g., Canada (Attorney General) v. Mossop, (SCC), [1993] 1S.C.R. 554.

Simply put, “whether because of the specialized knowledge of its decision-makers, special procedure, or non-judicial meansof implementing the Act”, an administrative body called upon to answer a question that falls within its area of relative expertise willgenerally be entitled to greater curial deference: Pushpanathan, supra, at para. 32. [65] The case before us does not fit neatly into the initial presumptive categories mentioned in Dunsmuir. I say this because although itconcerns the

interpretation of a “home” or “enabling” statute, the decision is outside of the traditional administrative tribunal contextbecause it is the decision of the Minister. Whether the Dunsmuir presumption respecting “home” statutes, which normally drives aconclusion that the standard of review is reasonableness, applies in cases such as this is a matter of some jurisprudential debate. TheSupreme Court of Canada has not yet addressed this issue directly. [66] In a pre-Dunsmuir case, Baker v.

Canada (Minister of Citizenship & Immigration), (SCC), [1999] 2 S.C.R. 817,the Court reviewed the discretion of an immigration officer exercised on behalf of the Minister under s. 114(1) of the relevant Act and itsgermane Regulations to allow a person to remain in Canada on compassionate grounds including the “proper purposes” and “relevantconsiderations” for which and upon which the discretion could be exercised. The Court concluded that the officer’s decision as towhether particular purposes were proper and which considerations were relevant, was reviewable for reasonableness.

L’Heureux-DubéJ. at para. 62 articulated the reasons for this conclusion: 62 These factors must be balanced to arrive at the appropriate standard of review. I conclude that considerable deference should beaccorded to immigration officers exercising the powers conferred by the legislation, given the fact-specific nature of the inquiry, its rolewithin the statutory scheme as an exception, the fact that the decision-maker is the Minister, and the considerable discretion evidencedby the statutory language.

Yet the absence of a privative clause, the explicit contemplation of judicial review by the FederalCourt―Trial Division and the Federal Court of Appeal in certain circumstances, and the individual rather than polycentric nature of thedecision, also suggest that the standard should not be as deferential as “patent unreasonableness”. I conclude, weighing all these factors,that the appropriate standard of review is reasonableness simpliciter. [67] In Echo Bay Mines Ltd. v.

Canada (Minister of Indian Affairs and Northern Development), 2003 FCA 270, 308 N.R. 135, apre-Dunsmuir case as well, the Court determined that the standard of review of the Minister’s decision respecting calculation of royaltiesunder the Canada Mining Regulations was correctness citing the lack of a privative clause, the issue of pure statutory

interpretation, theCrown’s financial interest in the decision, as well as the absence of relative expertise on the part of the decision-maker respecting purestatutory

interpretation. [68] Post-Dunsmuir in Hasan v. Canada (Minister of Citizenship and Immigration), 2011 FCA 339, 344 D.L.R. (4th) 739, the issue waswhether under s. 78 of the Immigration and Refugee Protection Regulations, SOR/ 2002-227, properly interpreted, a visa officer couldgive credit for certain educational credentials. The Court determined that the standard of review was correctness but did no newanalysis, relying instead on a previous ruling, Patel v.

Canada (Minister of Citizenship and Immigration), 2011 FCA 187, 419 N.R. 321,where it was decided that the standard of review of a visa officer’s decision is correctness. [69] In Sheldon Inwentash and Lynn Factor Charitable Foundation v. Canada, 2012 FCA 136, 432 N.R. 338, the question was whether the charitable entity was or was not a public foundation pursuant to the Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.). The Courtdetermined whether the Minister, acting in an administrative, not adjudicative capacity, erred by concluding, based on his

interpretationof that Act, that the entity could not qualify as a public foundation because it could not satisfy certain requirements in the legislation. TheCourt cited the absence of a privative clause, the fact that the proper

interpretation of the definition of “public foundation” is a questionof law on which the Minister possessed no greater expertise than the court, and the fact the Minister was acting in an administrative, notadjudicative, capacity in coming to the conclusion that correctness was the standard of review. [70] In Georgia Strait Alliance v. Canada (Minister of Fisheries and Oceans), 2012 FCA 40, 427 N.R. 110, the Minister had interpreteds. 58 of the Species at Risk Act, S.C. 2000, c. 29, and used a provision of the Fisheries Act, R.S.C. 1985, c. F-14, in respect of a decisionconcerning the habitat of killer whales.

The Court concluded that the Dunsmuir analytical framework and presumption could not, basedon the existing jurisprudence, be expanded to all administrative decision-makers who are responsible for the administration of a statute.

The Court held that unlike an adjudicative tribunal with express or implied jurisdiction to decide any question of law necessary todetermine a dispute, the Minister had no similar powers to interpret the Act. [71] The Court ultimately concluded, after doing a Dunsmuir analysis, that correctness was the standard of review of the Minister’sdecision for a number of reasons: there was no privative clause shielding the Minister’s

interpretation of the statute from judicial review,the statute itself restricted the Minister’s discretion, the Minister was acting in an administrative capacity only and Parliament had not setup an independent administrative tribunal to adjudicate legal issues under the Act, and mere expertise in fisheries did not confer on theMinister special legal expertise to interpret the provisions of the Act. The Court further held that the reasonableness standard of reviewdoes not apply to the

interpretation of a statute by a Minister responsible for its implementation unless Parliament has providedotherwise. The rationale for this approach was stated by the Court as follows: 96 This analytical framework and this presumption must be understood in the context in which they were developed: they concernadjudicative tribunals. The presumption is derived from the past jurisprudence which had extensively considered the standard of reviewapplicable to the decisions of such tribunals. By empowering an administrative tribunal to adjudicate a matter between parties,Parliament is presumed to have restricted judicial review of that tribunal’s

interpretation of its enabling statute and of statutes closelyconnected to its adjudicative functions. That presumption may however be rebutted if it can be found that Parliament’s intent isinconsistent with the presumption. [72] In Public Mobile Inc. v. Canada (Attorney General), 2011 FCA 194, 333 D.L.R. (4th) 463, the Court reviewed the Governor inCouncil’s

interpretation of the Telecommunications Act, S.C. 1993, c. 38, when deciding an appeal from a decision of the CanadianRadio-television and Telecommunications Commission. At issue was the meaning of the words “foreign control”. The Court assumed acorrectness standard applied in its analysis without deciding so.

[73] In Celgene Corp. v. Canada (Attorney General), 2011 SCC 1, [2011] 1 S.C.R. 3, the Patented Medicine Prices Review Boardinterpreted the term “sold in any market in Canada” as used in the Patent Act, R.S.C. 1985, c. P-4, and concluded that certain ofCelgene’s drug sales to Canadians fell within its authority for price investigation and its related remedial powers. This was a case of aspecialized tribunal interpreting its enabling legislation. The Court in obiter suggested that the appropriate standard of review wasreasonableness without deciding so. [74] In Halifax (Regional Municipality) v.

Canada (Public Works and Government Services), 2012 SCC 29, [2012] 2 S.C.R. 108, a casedealing with attribution by the Federal Minister of value to federal land for the purposes of calculating a payment to the City of Halifaxin lieu of taxes, the Court held that, provided the Minister applied the correct legal test, his decision was reviewable on a reasonablenessstandard. [75] For the most part, the foregoing cases determine that a Minister’s decision is reviewable on a correctness standard. However, I donot read these cases as saying the reasonableness standard of review can never apply to a Minister’s

interpretation of his home statute butonly that the germane initial presumption in Dunsmuir may not apply and an analysis must be done. [76] Admittedly, the genesis and development of the Dunsmuir analytical approach is for the most part, though not exclusively,reflected by jurisprudence dealing with adjudicative tribunals. There is nothing in Dunsmuir, however, which limits its application toadjudicative decision-makers or tribunals. Indeed, I believe the Dunsmuir approach is one of general application.

The Court inDunsmuir said this: 33 Although the instant appeal deals with the particular problem of judicial review of the decisions of an adjudicative tribunal, thesereasons will address first and foremost the structure and characteristics of the system of judicial review as a whole. In the wake of Bakerv. Canada (Minister of Citizenship and Immigration), (SCC), [1999] 2 S.C.R. 817, Suresh v. Canada (Minister ofCitizenship and Immigration), [2002] 1 S.C.R. 3, 2002 SCC 1, Mount Sinai Hospital Center v. Quebec (Minister of Health and SocialServices), [2001] 2 S.C.R. 281, 2001 SCC 41, and C.U.P.E. v.

Ontario (Minister of Labour), [2003] 1 S.C.R. 539, 2003 SCC 29, it hasbecome apparent that the present system must be simplified. The comments of LeBel J. in Chamberlain v.

Surrey School District No. 36,[2002] 4 S.C.R. 710, 2002 SCC 86, at paras. 190 and 195, questioning the applicability of the “pragmatic and functional approach” tothe decisions and actions of all kinds of administrative actors, illustrated the need for change. [77] There are a myriad of governmental administrative decisions, large or small, which are not made by tribunals and for which nostatutory deference has been expressed through the use of a privative clause, yet it does not follow that they are therefore destined to bereviewed on a standard of correctness.

This was recognized by Binnie J. in Canada (Citizenship and Immigration) v. Khosa, 2009 SCC12, [2009] 1 S.C.R. 339: 25 I do not share Rothstein J.’s view that absent statutory direction, explicit or by necessary implication, no deference is owed toadministrative decision-makers in matters that relate to their special role, function and expertise. Dunsmuir recognized that with orwithout a privative clause, a measure of deference has come to be accepted as appropriate where a particular decision had been allocatedto an administrative decision-maker rather than to the courts.

This deference extended not only to facts and policy but to a tribunal’sinterpretation of its constitutive statute and related enactments because “there might be multiple valid

interpretations of a statutoryprovision or answers to a legal dispute and that courts ought not to interfere where the tribunal’s decision is rationally supported”(Dunsmuir, at para. 41). A policy of deference “recognizes the reality that, in many instances, those working day to day in theimplementation of frequently complex administrative schemes have or will develop a considerable degree of expertise or field sensitivityto the imperatives and nuances of the legislative regime” (Dunsmuir, at para. 49, quoting Professor David J.

Mullan, “Establishing theStandard of Review: The Struggle for Complexity?” (2004), 17 C.J.A.L.P. 59, at p. 93). Moreover, “[d]eference may also be warrantedwhere an administrative tribunal has developed particular expertise in the application of a general common law or civil law rule inrelation to a specific statutory context” (Dunsmuir, at para. 54). 26 Dunsmuir stands against the idea that in the absence of express statutory language or necessary implication, a reviewing court is“to apply a correctness standard as it does in the regular appellate context” (Rothstein J., at para. 117).

Pezim has been cited and appliedin numerous cases over the last 15 years. Its teaching is reflected in Dunsmuir. With respect, I would reject my colleague’s effort to rollback the Dunsmuir clock to an era where some courts asserted a level of skill and knowledge in administrative matters which furtherexperience showed they did not possess. [78] It makes practical sense that adjudicative bodies and traditional administrative tribunals do not solely have a monopoly on“expertise in the subject matter” under administration.

Even the Court in Georgia Strait acknowledged that a Minister, in order to makea decision pursuant to a particular statutory provision, must form some view of the meaning of such a provision in order to make thedecision. Presumably this view will be informed by his or her familiarity with the subject matter of the statute, the manner in which theprovisions of the statute interact and policy where applicable.

The deference referred to by Binnie J. in the above excerpt to “thoseworking day to day in the implementation of frequently complex administrative schemes” respecting the decision can, in my view, applyequally well to non-administrative tribunal decision-makers. [79] In short, there is no principled reason why apart from the presumption, a fulsome Dunsmuir standard of review analysis cannot, inthe case of non-adjudicative decision-makers, result in a determination that the standard of review is reasonableness if it is appropriate. (

b) Did the Chambers judge err in concluding that the standard of review to be applied to the decisions under review wascorrectness? [80] For the purposes of this case it is not necessary to decide whether the Dunsmuir initial presumption respecting a tribunal’sinterpretation of its home statute is the starting point. In this case it is appropriate to do a Dunsmuir analysis and determine if deferenceshould be accorded to the Minister with respect to his

interpretation of the relevant statutory provisions. Based on the standard of reviewanalysis which follows, I conclude that the Chambers judge erred in his determination that the correctness standard of review applied tothe Minister’s decision.

(

i) Privative Clause [ 81 ] It is clear that the Minister has, under s. 85(1) of the Regulations , the power to determine any questions arising from time to time in determining the amount of royalty. This power is subject to review. A determination as to the amount of royalty payable is appealable on issues of fact and law to the Board of Revenue Commissioners pursuant to ss. 16(1) and 16(1.2) of the Act . However, an appeal regarding determinations respecting the price of the mineral made for the purpose of calculating a royalty is prohibited.

Section 16(1.3) of the Act specifically states: 16(1.3) A person may not appeal any part of a determination respecting the price of a mineral made by or pursuant to the regulations made pursuant to clause 22(1.1)(

g) for the purpose of calculating the royalty. The Act makes it clear that the determination of the fair market value deemed under s. 27(3)(

a) of the

Schedule is not appealable. This signals the intention of the Legislature that the Minister’s decision and

interpretation of “any part of a determination respecting the price of a mineral” should be accorded deference by virtue of the exclusion from the appeal process. [ 82 ] The Chambers judge dismisses this factor as being equally consistent with a legislative intent that the calculation is simple and straightforward. I disagree. Absence or presence of appeal provisions in statutes are, in most cases, not indicative of the simplicity of the issue. It is more likely an indicator of legislative intent to allow or not allow a challenge to the decision.

In short, the interplay of s. 85(1) of the Regulations and s. 16(1.3) of the Act points to deference. (ii) The Context and Purpose of the Provision [ 83 ] The purpose of s. 27(3)(

a) of the

Schedule is to deem a fair market value where the uranium producer chooses not to disclose the actual values and prices of non-arm’s length transactions or where for some reason the information is not forthcoming. The Minister must have some basis to calculate the royalty. He does this implementing the deeming provision in accordance with the

Schedule . [ 84 ] The Minister argues that the purpose and context of the legislation is the management of Crown minerals and that he has been vested with significant discretionary authority for the purpose of administering the Act and its subordinate legislation. Although the deeming provision in s. 27(3)(

a) of the

Schedule itself does not convey a discretionary power in the Minister, nevertheless, that power is exercised in the context of substantial discretion in making some decisions respecting mineral dispositions and especially respecting decisions as they relate to royalties. [ 85 ] Mineral lands are not acquirable except by way of a Crown disposition issued at the Minister’s discretion ( ss. 3(2) and 4 of the Act ). The Minister can exercise discretion to cancel a disposition or grant relief from cancellation ( ss. 9 and 10 of the Act ). [ 86 ]

Section 13 of the Act provides that minerals are not to be extracted, recovered or produced from any Crown mineral lands except as permitted by the Regulations or under the authority and in accordance with a Crown lease. [ 87 ]

Section 27.1(1) of the Act , which allows the Minister discretion to ignore agreements or transactions which artificially reduce the liability to pay royalty, although not directly relevant to the question in this appeal, is indicative of the significant discretion granted to the Minister under the Act and a recognition of a broader object to ensure that royalty payments are not artificially manipulated. Implicit in such a discretion is knowledge of the underlying workings and policy of the royalty scheme as well as the uranium industry. [ 88 ] Section 26(1)(

b) of the

Schedule gives the Minister power to approve certain expenses which, when approved, reduce the fair market value of the uranium for the purpose of determining “gross sales” on which royalties are paid.

Section 28 of the

Schedule allows the Minister to deem a fair market value, notwithstanding s. 27, and entrusts the Minister to know and recognize whether a sales price for uranium does or does not reflect the fair market value. This

section again implies that the Minister is responsible for ensuring that royalties are calculated appropriately and are not manipulated. [ 89 ] Section 36(1) of the

Schedule allows the Minister to exempt uranium sales from tiered royalties if, inter alia, those sales are from a secondary source of previously processed material “that the minister considers appropriate in the circumstances”.

Section 39 of the

Schedule allows the Minister to recognize the allocation of the capital recovery bank as between parties to a contract so long as certain requirements are met and further to determine that allocation if he is satisfied it is not reflective of certain factors. [ 90 ] In addition to the power to make decisions respecting royalties pursuant to s. 85(1) of the Regulations , the Act , Regulations and

Schedule in some cases give the Minister considerable discretion respecting the elements used to calculate the royalty and the determination of pricing and corresponding expenses claimed. The Legislature’s choice to employ discretionary language in the various provisions mentioned above suggest a standard of deference when it comes to the administration of the uranium royalty scheme. [ 91 ] This is understandable given the public interest served. The fact that the Minister acts in the public interest is explicitly stated in the Act ( ss. 4 (

b) and 18 ). The “protection of the public” aspect of the Minister’s role here is related to his responsibility for ensuring the payment of appropriate royalties due to the Crown for a non-renewable public resource. [ 92 ] Although it is s. 27(3)(

a) of the

Schedule and not the Minister that deems the fair market value, it is in the context of all the foregoing that the Minister is empowered to calculate that value for non-arm’s length sales of uranium by utilizing “average sales price” in accordance with the Act for the purposes of the royalty calculation. [ 93 ] The purpose of s. 27(3)(

a) and the legislative provisions respecting the administration of uranium royalties as a whole points to deference. (iii) Nature of Question and Expertise of the Tribunal [ 94 ] The Chambers judge acknowledged that the Minister has expertise in the area of mining and energy and specifically with regard to the uranium industry which the Court does not have. However, I do not agree that the

interpretation of the relevant phrase does not

require such expertise. Moreover, I cannot agree with Areva that the question of the meaning of average sales price does not raise policyconsiderations. [95] The isolation of a phrase without consideration for its context runs contrary to the “modern principle” of statutory

interpretationespoused by the Supreme Court in Re Rizzo & Rizzo Shoes Ltd., (SCC), [1998] 1 S.C.R. 27 at para. 21: … Today there is only one principle or approach, namely, the words of

an Act are to be read in their entire context and in theirgrammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament. … [96] The Chambers judge isolates the relevant phrase as a matter of pure statutory

interpretation, i.e., a question of law. On this basis itis true the Minister has less expertise than the Court. However, the provision to be interpreted is not straightforward. In Halifax v.Canada, Cromwell J. observes: 55 Discretion conferred by statute must be exercised consistently with the purposes and policies underlying its grant: Ontario(Public Safety and Security) v. Criminal Lawyers’ Association, 2010 SCC 23, [2010] 1 S.C.R. 815, at para. 46; see also Baker v. Canada(Minister of Citizenship and Immigration), (SCC), [1999] 2 S.C.R. 817, at para. 65; Oakwood Development Ltd. v.Rural Municipality of St.

François Xavier, (SCC), [1985] 2 S.C.R. 164, at p. 174; Committee for the Equal Treatment ofAsbestos Minority Shareholders v. Ontario (Securities Commission), 2001 SCC 37, [2001] 2 S.C.R. 132, at paras. 39-45. The interpretive question in this case is suffused with policy and discretionary considerations concerning a consistent approach to theimposition of royalties for arm’s length and non-arm’s length transactions and as between producers. This makes it not only a question ofstatutory

interpretation but a question of whether, and how, the term should be interpreted as a matter of policy to provide a consistentapproach to royalties based on the statutory provisions as a whole. [97] Firstly, the royalty set out in the

Schedule for both arm’s length and non-arm’s length sales is the same. In both cases, the royalty isbased on 5% of the gross sales being the aggregate of the sales prices plus any tiered royalty, if applicable. It may be inferred that inboth cases the object is to accurately and fairly determine “gross sales” so the royalty can be applied. [98] Secondly, there is no explicit statutory met

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