West Fraser Mills Ltd. v. British Columbia (Workers’ Compensation Appeal Tribunal), 2018 SCC 22 – Administrative law — Boards and tribunals — Jurisdiction
On appeal from a judgment of the British Columbia Court of Appeal (2016 BCCA 473) affirming a decision of MacKenzie J. (2015 BCSC 1098).
A tree faller was fatally struck by a rotting tree while working within the area of a forest license held by West Fraser Mills Ltd. The faller was employed by an independent contractor. As the license holder, West Fraser Mills was the “owner” of the workplace, as defined in Part 3 of the Workers Compensation Act.
The Workers’ Compensation Board investigated the accident and concluded that West Fraser Mills had failed to ensure that all activities of the forestry operation were planned and conducted in a manner consistent with s. 26.2(1) of the Occupational Health and Safety Regulation, which had been adopted by the Board pursuant to s. 225 of the Act. The Board also imposed an administrative penalty on West Fraser Mills pursuant to s. 196(1) of the Act, which permits the Board to penalize an “employer”. These aspects of its decision were confirmed by the review division. The Workers’ Compensation Appeal Tribunal dismissed West Fraser Mills’ appeal, but reduced the administrative penalty. The British Columbia Supreme Court and the Court of Appeal upheld the Tribunal’s order.
Held (6-3): The appeal should be dismissed.
Per McLachlin C.J. and Abella, Moldaver, Karakatsanis, Wagner and Gascon JJ.:
Section 225 of the Act empowers the Board to “make regulations [it] considers necessary or advisable in relation to occupational health and safety and occupational environment”. Where the statute confers such a broad power on a board to determine what regulations are necessary or advisable to accomplish the statute’s goals, the question the court must answer is not one of vires in the traditional sense, but whether the regulation at issue represents a reasonable exercise of the delegated power, having regard to the statute’s goal. Section 26.2(1) is clearly linked to workplace safety and meets this requirement. It also fits with other provisions of the statute, which allow the Board to make regulations that apply to any persons working in or contributing to the production of an industry and in support of the promotion of occupational health and safety in the workplace in broad terms. Finally, two external contextual factors, both within the expertise and capacity of the Board, are relevant. First, the Board adopted s. 26.2(1) in its present form in response to a concern about the growing rate of workplace fatalities in the forestry sector, a concern that is plainly one of “occupational health and safety and occupational environment”, the focus of s. 225 of the Act. Second, s. 26.2(1) is a natural extension of an owner’s duty to maintain the worksite. To fulfill that duty, the owner must ensure that the work is planned and conducted safely.
With respect to the administrative penalty provision, the Tribunal’s interpretation of s. 196(1) was not patently unreasonable. Courts reviewing administrative decisions are obliged to consider, not only the text of the law and how its internal provisions fit together, but also the consequences of interpreting a provision one way or the other and the reality of how the statutory scheme operates on the ground, particularly where the standard of review is patent unreasonableness.
The Tribunal had before it two competing plausible interpretations of s. 196(1). One was a narrow approach that would undermine the goals of the statute. The other was a broad approach, which both recognized the complexity of overlapping and interacting roles on the actual worksite and would further the goals of the statute and the scheme built upon it. The Tribunal’s choice of the second approach was not openly, clearly and evidently unreasonable so as to border on the absurd. In this case, the respective consequences of the competing interpretations and the intended operation of the scheme mitigate against finding that the interpretation chosen by the Tribunal is patently unreasonable. West Fraser Mills’ obligation to ensure the health and safety of workers at the worksite was not limited to the health and safety of its own employees. A broad interpretation of s. 196(1) to include employers under the Act whose conduct can constitute a breach of their obligations as owners will best further the statutory goal of promoting workplace health and safety and deterring future accidents. This interpretation is also responsive to the reality that maintaining workplace safety is a complex exercise involving shared responsibilities of all concerned. Finally, while s. 196(1) can be engaged on the basis of an employer’s failure to comply with specific obligations provided in the Act, the provision is not limited to such circumstances.
Per Côté J. (dissenting):
Section 26.2(1) of the Regulation is ultra vires on the correctness standard of review, but even if this were not the case, it was patently unreasonable to impose an administrative penalty — applicable only to breaches committed when acting in the capacity of an employer — on the basis that West Fraser Mills was found guilty of breaching its obligations as an owner under s. 26.2(1).
When a regulator acts in an adjudicative capacity, it may bring technical expertise to bear or exercise discretion in accordance with policy preferences. In this context, there may exist a range of reasonable conclusions. However, when a regulator acts in a legislative capacity, the court must determine whether the impugned regulation falls within that grant of authority. In that situation, there is no reasonable range of outcomes, so correctness is the appropriate standard of review. Here, the Board concedes that it was engaged in an exercise of legislative power when it enacted s. 26.2(1), so it is not entitled to any deference as to its own conclusion that it had the authority to enact the impugned regulation.
A regulation may not undermine the operation of the statute as a whole by assigning duties to owners that are clearly not contemplated by the Act. In enacting s. 26.2(1), the Board exceeded its mandate and the scope of its delegated legislative powers by impermissibly conflating the duties of owners and employers in the context of a statutory scheme that sets out separate and defined obligations for those workplace entities. The legislative scheme defines “employer” and “owner” as separate entities and expressly differentiates their duties in ss. 115 to 121. Read together, ss. 115 and 119, which set out the general duties of employers and owners, respectively, create separate silos of responsibility, whereby the duties ascribed to employers and owners are tethered to their unique roles and capacities to ensure workplace safety. Employers are in the best position to ensure that workers are informed of known or reasonably foreseeable safety hazards because of their direct supervisory relationship with their employees; owners are in the best position to assume macro‑level responsibilities pertaining to the workplace more generally.
This structural reading of the statute is bolstered by s. 107(2)(e) of the Act. Section 107(2)(e) states that one of the purposes of Part 3 of the Actis to ensure that employers, workers and others who are in a position to affect the occupational health and safety of workers share that responsibility to the extent of each party’s authority and ability to do so. Section 107(2)(e) also makes it clear that the Act aims to impose obligations on parties only to the extent of their authority and ability, which aligns with the manner in which duties are assigned to employers and owners under ss. 115 and 119 of the Act. Further, it expressly limits the extent to which and the means by which the legislature pursues that purpose. Section 26.2(1) does not respect these silos of responsibility. It requires owners to assume responsibility for the manner in which activities are planned and conducted. This micro‑level obligation is categorically different from the macro‑level duties related to workplace conditions that are assigned to owners under s. 119. By imposing upon owners a type of obligation that the Actreserves to employers, the Board contravened the clear structure of divided responsibility that the Act creates. The external contextual factors that the majority outlines are neither persuasive nor appropriate considerations — they do not permit the Board to undermine the legislature’s statutory scheme for addressing workplace health and safety.
Even assuming that the impugned regulation is intra vires, there is no nexus between the underlying violation and the imposition of an administrative penalty. West Fraser Mills was charged with violating its obligations as an owner under s. 26.2(1) of the Regulation. Yet, it was subjected to an administrative penalty under s. 196(1) of the Act, which only authorizes the Board to impose such a penalty on an entity acting in the capacity of an employer. That decision was patently unreasonable.
Reading s. 196(1) to apply to an owner, so long as that owner is also an employer at the workplace, was erroneous for several reasons. First, the category of “employer” does not encompass “owner”. Second, s. 196(1) specifies that an administrative penalty may be imposed on an employer, which suggests that it cannot be imposed on other categories of persons. Third, the legislature used the word “person” or “persons” where it intended to encompass multiple entities or entities acting simultaneously in multiple roles. Fourth, the use of the term “employer” in s. 196(1) was no accident, as none of its other subsections uses the term “person” or “owner” rather than “employer”. Finally, it is consistent with the statutory scheme as a whole for certain remedial measures to be reserved for breaches of certain types of obligations.
Per Brown J. (dissenting):
There is agreement with the majority that s. 225 of the Act is sufficiently broad to support the conclusion that the Board’s adoption of s. 26.2(1) of the Regulationis intra vires, although for different reasons. Administrative bodies must be correct in their determinations of true questions of jurisdiction or vires. The Board’s authority to adopt s. 26.2(1) is an issue of vires relating to subordinate legislation, and is therefore manifestly jurisdictional. Questions of jurisdiction are always to be reviewed for correctness. However, as long as the statutory delegate operates within the bounds of its grant of authority, the overall reasonableness of how the delegate has chosen to exercise its lawful authority is not the proper subject of judicial attention. The majority’s sidestepping the jurisdictional inquiry in favour of a review of various contextual factors which are said to support reasonableness review ought to be rejected. If the Board’s adoption of s. 26.2(1) presents a jurisdictional question, such contextual factors are irrelevant.
On the question of the penalty, there is agreement with Côté J. that the Board’s decision to impose a penalty upon West Fraser Mills under s. 196(1) of the Act for a breach of s. 26.2(1) of the Regulation was patently unreasonable.
Per Rowe J. (dissenting):
Judicial review of the validity of a regulation has two steps. The first relates to jurisdiction, and the second is a substantive inquiry into the exercise of the grant of authority. There is agreement with the majority that s. 26.2(1) of the Regulation is intra vires, with the caveat that working day to day with an administrative scheme does not give greater insight into statutory interpretation, including the scope of jurisdiction. That is a matter of legal analysis.
Concerning the monetary penalty, there is agreement with Côté J. that the Tribunal’s decision was patently unreasonable and runs directly contrary to the clear wording of s. 196(1) of the Act.
Reasons for judgment: McLachlin C.J. (Abella, Moldaver, Karakatsanis, Wagner and Gascon JJ. concurring)
Dissenting Reasons: Côté J., Brown J., Rowe J.
Neutral Citation: 2018 SCC 22
Docket Number: 37423
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