Global Marine Systems Ltd. v. Canada (Transport)

Global Marine Systems Ltd. v. Canada (Transport)
Court (s) Database
Federal Court Decisions
Date
2020-03-25
Neutral citation
2020 FC 414
File numbers
T-1188-19
Notes
Digest
Decision Content
Date: 20200325
Docket: T-1188-19
Citation: 2020 FC 414
Ottawa, Ontario, March 25, 2020
PRESENT: The Honourable Madam Justice Strickland
BETWEEN:
GLOBAL MARINE SYSTEMS LTD.
Applicant
And
MINISTER OF TRANSPORT
Respondent
JUDGMENT AND REASONS
[1] The Applicant, Global Marine Systems Ltd. (“Global Marine”), seeks to judicially review an email dated June 20, 2019, from Emilie Gelinas, Director of the Seaway and Domestic Shipping Policy division within the Marine Policy Directorate of Transport Canada. The email informed Global Marine that the standby activities of the vessel “Cable Innovator” were considered by Transport Canada to be marine activities of a commercial nature as defined in s 2(1)(f) of the Coasting Trade Act, SC 1992, c 31 (or the “Act”). This is an application for judicial review of that finding, brought pursuant to s 18.1 of the Federal Courts Act, RSC 1985, c F-7.
Background
[2] The “Cable Innovator” is a British-flagged vessel, operated by Global Marine. It is a specialized cable ship utilized for the installation, maintenance and repair of subsea fibre optic cables. Global Marine provides these services pursuant to the North American Submarine Cable Maintenance Service Contract (“NAZ Contract”) dated December 2, 2011 and entered into with various North American Zone Members, who each have interests in submarine cables within the North American Zone (“NAZ”). The NAZ covers a prescribed subsea area running along the west coast of North America from Mexico to Alaska and extending westward to the 167th meridian, near Hawaii.
[3] The “Cable Innovator”, and its predecessor vessels, have been based in Victoria Harbour in Victoria, British Columbia, for many years. Global Marine asserts that this has been the case for the past 30 to 40 years. Pursuant to the NAZ Contract, the “Cable Innovator” must at all times be ready, manned and equipped to respond within 24 hours to notification from a NAZ Member of the need for a cable repair. Global Marine is paid a repair and maintenance service rate when mobilized to perform such services. It is also paid an annual fee in return for which it makes the “Cable Innovator”, its crew and equipment, available to perform the work under the NAZ Contract, which includes the costs of the “Cable Innovator” when on standby. Global Marine reports that the vast majority of the work performed by the “Global Innovator” is outside Canada, and since 2012, less than 3% of the vessel’s operating days were on projects in Canadian waters.
[4] On September 21, 2016, Global Marine submitted an Application for Vessel Temporary Admission to the Coasting Trade of Canada (“C47 application”) to the Canada Border Services Agency (“CBSA”) and the Canadian Transportation Agency (“CTA”). The CTA is required to determine if a suitable Canadian ship or non-duty paid ship is available to provide the proposed service or perform the activity described in a C47 application. On October 17, 2016, CBSA advised that the CTA had determined that there was no suitable Canadian ship available to provide the service or perform the activity described in the submitted C47 application and that Global Marine was authorized to temporarily import the “Cable Innovator” into Canada (“C47 Temporary Admission”). However, that a coasting trade licence (“C48 licence” or “coasting trade licence”) must be obtained before the vessel could commence its operations.
[5] Global Marine asserts that its prior practice, since at least 2008, was to maintain an annual C47 temporary admission and to seek a C48 licence only when needed to undertake subsea cable maintenance or repairs in Canadian waters. This practice was meant to shorten the time that would be required to obtain a C48 licence.
[6] However, on May 2, 2017, Global Marine received an email from Transport Canada advising that the “Cable Innovator” was required to hold a C48 licence while on standby in Victoria Harbour. Various communications were exchanged and meetings were held between July 2017 and March 2019 during which Global Marine put forward information in support of its view that being on standby is not a marine activity of a commercial nature, and therefore, that a C48 licence is not required while the vessel is on standby. This included a meeting with the Assistant Deputy Minister of Transport Canada on February 27, 2019.
[7] By email of June 20, 2019, Ms. Gelinas advised Global Marine that Transport Canada continued to be of the view that the standby activities of the vessel “Cable Innovator” are marine activities of a commercial nature under s 2(1)(f) of the Coasting Trade Act, and that the “Cable Innovator” should, accordingly, obtain a C48 licence for cable repair and standby activities.
[8] On July 22, 2019, Global Marine filed a Notice of Application seeking judicial review of the June 20, 2019 email as a delegated decision of the Minister of Transport (“Minister”).
Legislative Scheme
[9] It is not in dispute that obtaining a C48 licence is a two-part process. First, a C47 application, in prescribed form, must be submitted to the CBSA and CTA. The CTA determines if a suitable Canadian ship or non-duty paid ship is available to carry out the proposed service or perform the activity described in the application (Coasting Trade Act, ss 4(1)(a), 8(1)). If not, the CTA will approve the proposed temporary importation of the foreign vessel. However, regardless of the temporary importation being approved, the vessel may not engage in the proposed work until a valid coasting trade licence is issued by the Minister. At this second stage, the vessel must be inspected by Transport Canada’s Marine Safety and Security vessel inspection branch to ensure that it meets all applicable safety and pollution requirements (Coasting Trade Act, s 4(1)(d) and (e)). Further, the duties and taxes in respect of the temporary importation must be paid (Coasting Trade Act, s 4(1)(c)).
[10] According to the affidavit of Marc-Yves Bertin, Director General of the Marine Policy Directorate at Transport Canada, sworn on September 19, 2019, and submitted in support of the Minister’s response to this application for judicial review (“Bertin Affidavit”), rates on imported goods are prescribed by the Customs Tariff, SC 1997, c 36. Imported marine vessels are generally subject to a tariff of 25%. However, a vessel imported into Canada on a temporary basis under a coasting trade licence will have that duty reduced to the customs duty on 1/120 of the value of the vessel for each month or part of a month during which it remains in Canada per the Vessel Duties Reduction or Removal Regulations, SOR/90-304, ss 3(1) and 4. Once the applicant has satisfactorily established that these requirements have been met, CBSA, on behalf of the Minister of Public Safety and Emergency Preparedness, will issue a coasting trade licence, which is valid for up to one year.
[11] What is in dispute in this matter is whether the “Cable Innovator” is engaged in “marine activity of a commercial nature”, pursuant to s 2(1)(f) of the Coasting Trade Act, when it is on standby in Victoria Harbour, and therefore, whether it requires a coasting trade licence while on standby.
Coasting Trade Act
Coasting Trade Act, SC 1992, c 31
2 (1) In this Act,
…
Coasting trade means
(a) the carriage of goods by ship, or by ship and any other mode of transport, from one place in Canada or above the continental shelf of Canada to any other place in Canada or above the continental shelf of Canada, either directly or by way of a place outside Canada, but, with respect to waters above the continental shelf of Canada, includes the carriage of goods only in relation to the exploration, exploitation or transportation of the mineral or non-living natural resources of the continental shelf of Canada,
(b) subject to paragraph (c), the carriage of passengers by ship from any place in Canada situated on a lake or river to the same place, or to any other place in Canada, either directly or by way of a place outside Canada,
(c) the carriage of passengers by ship from any place situated on the St. Lawrence River northeast of the Saint Lambert lock or on the Fraser River west of the Mission Bridge
(i) to the same place, without any call at any port outside Canada, other than one or more technical or emergency calls, or
(ii) to any other place in Canada, other than as an in-transit call, either directly or by way of a place outside Canada,
(d) the carriage of passengers by ship from any place in Canada other than from a place to which paragraph (b) or (c) applies
(i) to the same place, without any call at any port outside Canada, other than one or more technical or emergency calls, or
(ii) to any other place in Canada, other than as an in-transit call, either directly or by way of a place outside Canada,
(e) the carriage of passengers by ship
(i) from any place in Canada to any place above the continental shelf of Canada,
(ii) from any place above the continental shelf of Canada to any place in Canada, or
(iii) from any place above the continental shelf of Canada to the same place or to any other place above the continental shelf of Canada
where the carriage of the passengers is in relation to the exploration, exploitation or transportation of the mineral or non-living natural resources of the continental shelf of Canada, and
(f) the engaging, by ship, in any other marine activity of a commercial nature in Canadian waters and, with respect to waters above the continental shelf of Canada, in such other marine activities of a commercial nature that are in relation to the exploration, exploitation or transportation of the mineral or non-living natural resources of the continental shelf of Canada; (cabotage)
…
3 (1) No foreign ship or non-duty paid ship shall, except in accordance with a licence, engage in the coasting trade.
…
4(1) Subject to section 7, on application therefor by a person resident in Canada acting on behalf of a foreign ship, the Minister of Public Safety and Emergency Preparedness shall issue a licence in respect of the foreign ship, where the Minister is satisfied that
(a) the Agency has determined that no Canadian ship or non-duty paid ship is suitable and available to provide the service or perform the activity described in the application;
(b) where the activity described in the application entails the carriage of passengers by ship, the Agency has determined that an identical or similar adequate marine service is not available from any person operating one or more Canadian ships;
(c) arrangements have been made for the payment of the duties and taxes under the Customs Tariff and the Excise Tax Act applicable to the foreign ship in relation to its temporary use in Canada;
(d) all certificates and documents relating to the foreign ship issued pursuant to shipping conventions to which Canada is a party are valid and in force; and
(e) the foreign ship meets all safety and pollution prevention requirements imposed by any law of Canada applicable to that foreign ship.
…
5 Subject to section 7, on application therefor by a person resident in Canada acting on behalf of a non-duty paid ship, the Minister of Public Safety and Emergency Preparedness shall issue a licence in respect of the non-duty paid ship, where the Minister is satisfied that
(a) the Agency has determined that no Canadian ship is suitable and available to provide the service or perform the activity described in the application;
(b) where the activity described in the application entails the carriage of passengers by ship, the Agency has determined that an identical or similar adequate marine service is not available from any person operating one or more Canadian ships; and
(c) arrangements have been made for the payment of the duties and taxes under the Customs Tariff and the Excise Tax Act applicable to the non-duty paid ship in relation to its temporary use in Canada.
…
12 For the purposes of enforcing this Act, the Minister of Transport may designate any person or class of persons as enforcement officers and shall furnish every enforcement officer with a certificate of that designation
…
13 (1) Where a ship contravenes subsection 3(1), the ship is guilty of an offence and is liable on summary conviction to a fine not exceeding fifty thousand dollars.
Decision under review
[12] The June 20, 2019 email from Ms. Gelinas states as follows:
Dear Mr. Wrottesley:
Thank you for your submission regarding the activities of the Cable Innovator, dated 25 March 2019. I write to advise you that the information provided does not change Transport Canada’s assessment that the standby activities in support of cable repair by the Cable Innovator in Canadian waters are considered to be commercial marine activities under the Coasting Trade Act, and meets the definition of coasting trade found in section 2(1)(f) of the Act.
Based on your most recent correspondence as well as your previous correspondence, we understand that Global Marine Systems, Ltd., disputes that the vessel is engaged in a marine activity. It is our assessment that a crewed ship, in port, being maintained in a state of readiness to deploy to repair an emergency cable break within 24 hours as per the North American Zone agreement under which the ships [sic] operates, is clearly engaged in a marine activity.
The Cable Innovator should therefore obtain a coasting trade license for cable repair and standby activities. I would also note again that vessels that are in non-compliance with the Coasting Trade Act can face detention, and associated penalties, including fines upon summary conviction, as outlined in section 13 of the Act.
I trust that this concludes the matter.
Sincerely,
Emilie Gelinas
Issues
[13] Global Marine submits that there are two issues to be addressed at this judicial review:
Is the Minister’s interpretation of the phrase “marine activity of a commercial nature” at s 2(1)(f) of the Coasting Trade Act erroneous and does it fail to respect the modern rules of statutory interpretation?
Did the Minister unreasonably conclude that “Cable Innovator” was engaged in coasting trade?
[14] The Minister raises a preliminary issue, being whether the June 20, 2019 email is a decision or is otherwise reviewable as an administrative action. The Minister submits that the issue for substantive review is whether Transport Canada’s assessment that the standby activities of the “Cable Innovator” fall within the definition of “coasting trade” is reasonable.
[15] In my view, the issues are as follows:
Preliminary issue: Is the June 20, 2019 email reviewable on judicial review?If so,
Was the Minister’s decision reasonable?
Standard of review
[16] While Global Marine in its written submissions took the position that the Minister’s decision should be reviewed on the correctness standard, those submissions were filed prior to the Supreme Court of Canada’s decision in Canada (Minister of Citizenship and Immigration) v Vavilov, 2019 SCC 65 (“Vavilov”).
[17] When appearing before me, counsel for Global Marine and for the Minister submitted, and I agree, that the applicable standard of review is reasonableness.
[18] Counsel for Global Marine points out that in Vavilov the Supreme Court, amongst other things, stated that a “reasonable decision is one that is based on an internally coherent and rational chain of analysis and that is justified in relation to the facts and law that constrain the decision maker” (Vavilov at para 85). Further, that the particular context of a decision constrains what will be reasonable for an administrative decision maker to decide in a given case, and that what is reasonable in a given situation will always depend on the constraints imposed by the legal and factual context of the particular decision under review (Vavilov at paras 88, 90, 105). In determining if a decision is reasonable, a reviewing court asks whether the decision, “bears the hallmarks of reasonableness — justification, transparency and intelligibly — and whether it is justified in relation to the relevant factual and legal constraints that bear on the decision” (Vavilov at para 99). To be reasonable, a decision must be “justified in relation to the constellation of law and facts that are relevant to [it]” (Vavilov at para 105).
[19] The Minister submits that there is a discretionary element inherent in Transport Canada’s interpretation because the words at issue in s 2(1)(f), “any other maritime activity of a commercial nature”, are not defined in the Coasting Trade Act. As such, their meaning must be informed by Transport Canada’s expertise in maritime matters and with reference to the factual context. Transport Canada’s interpretation should be reviewed for reasonableness in the manner set out in Vavilov (at paras 91-98).
[20] In my view, paragraph 85 of Vavilov provides a concise statement of what a reviewing court is to be concerned with when assessing an administrative decision utilizing the reasonableness standard:
[85] Developing an understanding of the reasoning that led to the administrative decision enables a reviewing court to assess whether the decision as a whole is reasonable. As we will explain in greater detail below, a reasonable decision is one that is based on an internally coherent and rational chain of analysis and that is justified in relation to the facts and law that constrain the decision maker. The reasonableness standard requires that a reviewing court defer to such a decision.
Preliminary Issue: Is the June 20 email a reviewable on judicial review?
The Minister’s position
[21] The Minister submits that Global Marine misconstrues the June 20, 2019 email as being a “final decision” by Transport Canada that is capable of being judicially reviewed. The Minister acknowledges that judicial review is not be restricted to decisions and orders and may be brought in respect of administrative action (Federal Courts Rules, SOR/98-106, Rule 300; Air Canada v Toronto Port Authority Et Al, 2011 FCA 347 at para 24 (“Air Canada”)). However, the Minister submits that the subject email is not a decision or any other action that affects the legal rights of Global Marine, or one that imposes legal obligations or prejudicial effects (Air Canada at paras 28-29).
[22] While s 18.1 of the Federal Courts Act permits an application for judicial review “by anyone directly affected by the matter in respect of which relief is sought”, the Minister characterizes the email from Ms. Gelinas as non-binding guidance which does not directly affect Global Marine’s rights (Timberwest Forest Corp v Canada, 2007 FC 148 at para 92, aff’d 2007 FCA 389). The Minister analogizes the email to an advance ruling or courtesy letter, neither of which constitute a reviewable decision or reviewable administrative action (Philipps v Librarian and Archivist of Canada, 2006 FC 1378 at para 32 (“Philipps”); Hughes v Canada (Customs and Revenue Agency), 2004 FC 1055 at para 6 (“Hughes”); Rothmans, Benson & Hedges Inc v Minister of National Revenue, 148 FTR 3, [1998] FCJ No 79 at para 28 (FCTD) (QL/Lexis) (“Rothmans”); Democracy Watch v Conflict of Interest and Ethics Commissioner, 2009 FCA 15 at paras 9-11 (“Democracy Watch”)). The Minister further submits that Global Marine had no statutory right to a determination of any kind by Transport Canada. Ms. Gelinas’ responsibilities involve the administration of the Coasting Trade Act, including the provision of non-binding guidance. There is no decision taken when providing such general guidance. Ms. Gelinas’ role in that regard is distinct from enforcement actions that may be taken under ss 13-16 of the Coasting Trade Act and which would affect the legal rights and interests of a party. The June 20, 2019, email contained only Transport Canada’s assessment and advice that Global Marine should obtain a coasting trade licence for the repair and standby activities of the “Cable Innovator”. There was no direction or order to do so. The email contains no determination of Global Marine’s rights, but does flag consequences that could arise in the future for non-compliance with the Coasting Trade Act.
[23] The Minister also submits the June 20, 2019 email is the last email in a series of correspondence where the same viewpoint was reiterated — that the activities of the “Cable Innovator” met the definition of a coasting trade as found in s 2(1)(f) of the Coasting Trade Act. There is no reason to treat the June 20, 2019 email as a decision when compared with all of the previous emails setting out the same position. Given this, even if the June 20, 2019 email could be considered to be a decision, so too could the prior communications. On that basis, and because Global Marine did not seek judicial review of these prior decisions, it is now outside the 30 day time limit to do so with respect to the earlier, substantially similar, Transport Canada communications.
Global Marine’s position
[24] Global Marine points to Larny Holdings Ltd v Canada (Minister of Health), 2002 FCT 750 (“Larny”) to support its view that judicial review under s 18.1 of the Federal Courts Act is intended to be broad in scope and given a liberal interpretation. This can extend to letters stating that, in the regulator’s view, a violation of legislation has occurred and warning of further enforcement action if the practice at issue is not curtailed (also Markevich v Canada, 163 FTR 209, 172 DLR (4th) 164 (FCTD)(“Markevich”); Morneault v Canada (Attorney General), 189 DLR (4th) 96, 2000 CanLII 15737 (FCA) (“Morneault”); Gestion Complexe Cousineau (1989) Inc v Canada (Minister of Public Works and Government Services), 125 DLR (4th) 559, [1995] FCJ No 735 (FCA) (QL/Lexis) (“Gestion”); Falls Management Co v Canada (Minister of Health), 2005 FC 924 at paras 18-20).
Analysis
[25] In Air Canada, the Federal Court of Appeal addressed what may properly be the subject of a judicial review:
[24] Subsection 18.1(1) of the Federal Courts Act provides that an application for judicial review may be made by the Attorney General of Canada or by anyone directly affected by “the matter in respect of which relief is sought.” A “matter” that can be subject of judicial review includes not only a “decision or order,” but any matter in respect of which a remedy may be available under section 18 of the Federal Courts Act: Krause v. Canada, [1999] 2 F.C. 476 (C.A.). Subsection 18.1(3) sheds further light on this, referring to relief for an “act or thing,” a failure, refusal or delay to do an “act or thing,” a “decision,” an “order” and a “proceeding.” Finally, the rules that govern applications for judicial review apply to “applications for judicial review of administrative action,” not just applications for judicial review of “decisions or orders”: Rule 300 of the Federal Courts Rules.
[25] As far as “decisions” or “orders” are concerned, the only requirement is that any application for judicial review of them must be made within 30 days after they were first communicated: subsection 18.1(2) of the Federal Courts Act.
…
[28] The jurisprudence recognizes many situations where, by its nature or substance, an administrative body’s conduct does not trigger rights to bring a judicial review.
[29] One such situation is where the conduct attacked in an application for judicial review fails to affect legal rights, impose legal obligations, or cause prejudicial effects: Irving Shipbuilding Inc. v. Canada (Attorney General), 2009 FCA 116, [2010] 2 F.C.R. 488; Democracy Watch v. Conflict of Interest and Ethics Commission, 2009 FCA 15, (2009), 86 Admin. L.R. (4th) 149.
[30] The decided cases offer many illustrations of this situation: e.g., 1099065 Ontario Inc. v. Canada (Minister of Public Safety and Emergency Preparedness), 2008 FCA 47, 375 N.R. 368 (an official’s letter proposing dates for a meeting); Philipps v. Canada (Librarian and Archivist), 2006 FC 1378, [2007] 4 F.C.R. 11 (a courtesy letter written in reply to an application for reconsideration); Rothmans, Benson & Hedges Inc. v. Minister of National Revenue, [1998] 2 C.T.C. 176, 148 F.T.R. 3 (T.D.) (an advance ruling that constitutes nothing more than a non-binding opinion).
[26] To assess whether or not the June 20, 2019 email may be subject to judicial review, it is necessary to first review the relevant evidence and the factual background that led to the subject email.
[27] The Bertin Affidavit states that:
22. The Marine Policy Directorate (“Directorate”) is a division of TC with responsibility for, amongst other things, administration and enforcement activities under the [Coasting Trade] Act. These responsibilities include:
a) conducting compliance and enforcement action as mandated by sections 12-16 of the Act;
b) maintaining one or more designated officers with responsibility for takings enforcement action under the Act; and
c) providing non-binding guidance on the administration of the Act to external stakeholders, such as prospective coasting trade licence applicants, and other government departments.
[28] Further, that the responsibilities of Ms. Gelinas, the author of the June 20, 2019 email, include the administration of the Coasting Trade Act. In particular,
24. As part of this administrative function, Ms. Gelinas and other members of the Directorate provide non-binding guidance and advisory opinions in response to inquiries from stakeholders, such as vessel owners/operators and shipping agents, regarding how the Act would likely be applied to a particular set of circumstances. These requests for guidance are quite frequent: in 2019, the Directorate has received 43 requests to date for guidance or advisory opinions regarding the likely application of the Act. Similarly, the Directorate reaches out to stakeholders when it receives information to suggest that they may not be in compliance with the Act, as it did here, in order to advise of the Act’s requirements and to provide guidance.
[29] Ms. Gelinas is also an enforcement officer, designated as such by the Minister of Transport under s 12(1) of the Coasting Trade Act. As an enforcement officer, she makes decisions on enforcement action including determining whether the activities or actions of a vessel constitute a violation of the Act that warrants the laying of charges. Additionally, an enforcement officer may order the detention and search of a vessel in relation to the laying of a charge under the Coasting Trade Act. She has not taken enforcement action against the “Cable Innovator”.
[30] Global Marine prepared its C47 application, dated September 21, 2016, and submitted it along with a letter dated September 27, 2016, providing background to the C47 application. The CTA permitted the temporary importation of the vessel by way of CBSA’s October 17, 2016 letter.
[31] On May 2, 2017, Ms. Katerina Klimas, a Policy Analyst for the Marine Policy Directorate, wrote to Global Marine’s Canadian agent, King Bros. Limited, with respect to the C47 Temporary Admission. The email states that it had come to the attention of Transport Canada that a coasting trade licence had not yet been obtained for the “Cable Innovator” and that the vessel was on standby in Victoria Harbour for the activities described in the C47 Application. Further, that foreign vessels that have been granted temporary admission to Canada’s coasting trade are expected to acquire their coasting trade licence prior to or at the same time that they begin the marine activity of a commercial nature for which the application was made. Ms. Klimas stated, “[p]lease kindly obtain your Coasting Trade Licence as soon as possible. If you wish to discuss further, please don’t hesitate to contact me directly.”
[32] On May 10, 2017, Ms. Louise Laflamme, Chief, Marine Policy and Regulatory Affairs, wrote a follow up email to King Bros. Limited stating that vessels that are in non-compliance with the Coasting Trade Act may face penalties and vessel detention and drawing attention to ss 3(1), 13(1)-(2) and 16(1) of the Act in that regard. The letter states that immediate attention to the matter would be greatly appreciated and that CBSA was copied on the email so it would be aware of the issue. The email also indicated that the recipient should not hesitate to contact Ms. Laflamme should there be questions on the information provided or if the recipient wished to discuss it further.
[33] King Bros. Limited responded on the same date stating that the “Cable Innovator” was on standby and was not, at that time, engaged in coasting trade. Should it get a job in Canadian waters, it would then take the steps necessary to obtain a coasting trade licence.
[34] Ms. Gelinas responded by email of May 11, 2017. In her email, she summarized the C47 application made on behalf of the “Cable Innovator” and stated that as the vessel was operating on standby (the activity for which had been applied for) during the timeframe outlined in all of the attached documents, and that she again asked that a coasting trade licence for the “Cable Innovator” be obtained.
[35] By email to King Bros. Limited dated July 13, 2017, Ms. Gelinas stated that the activity of maintaining the “Cable Innovator” in a state of readiness, on standby for cable repairs off the west coast of Canada, is considered a marine activity of a commercial nature under the Coasting Trade Act. As such, a coasting trade licence was required for the vessel to undertake the activity of being on standby. And:
As the vessel is currently in non-compliance with the Act, I will kindly ask again that you obtain the coasting trade licence for the Cable Innovator, and that you inform Transport Canada once you have obtained it. If the licence is not obtained, TC will take action to detain the vessel until a licence is obtained or until the vessel permanently leaves Canadian waters. As noted below, and outlined in the Act under section 13, where a ship contravenes subsection 3(1), the ship is guilty of an offence and is liable on summary conviction to a fine not exceeding fifty thousand dollars, and, where an offence is committed by a ship under subsection (1) on more than one day or is continued by the ship for more than one day, it shall be deemed to be a separate offence for each day on which the offence is committed or continued.
[emphasis in original]
[36] Ms. Gelinas stated that she would follow up shortly to discuss and ensure that the information she provided had been understood.
[37] On July 13, 2017, Mr. Simon Smith, Vice President of King Bros. Limited, sent an email to Ms. Gelinas indicating his recent involvement and asking her to identify the section of the Coasting Trade Act that expressly defines a ship on standby as engaging in the coasting trade. He also noted that King Bros. Limited had never encountered this issue with any prior C47 application approvals.
[38] Ms. Gelinas responded on July 14, 2017, noting that coasting trade is defined in the Act, restating Transport Canada’s position that being on standby is considered to be a marine activity of a commercial nature falling under s 2(1)(f), and reproducing ss 2(1)(a)-(f) of the Coasting Trade Act. She asked to be advised when King Bros. Limited had received further direction from Global Marine and suggested that they speak by phone the following week in order to resolve the issue.
[39] By letter of July 21, 2017, Global Marine provided detailed information as to its operations, including pursuant to the NAZ Contract, the role of the “Cable Innovator” and its “port calls” in Victoria. Global Marine stated that it disagreed that the vessel’s port calls in Victoria constitute commercial marine activities in Canada for which a coasting trade licence is required, noting that it had maintained C47 temporary admissions for vessels for over 10 years and that this was the first time Transport Canada had demanded a C48 licence be immediately obtained. Global Marine stated that it welcomed the opportunity to meet to discuss the issues and to address any concerns Transport Canada may have.
[40] On August 28, 2017, Ms. Gelinas replied to the July 21, 2017 letter and reiterated Transport Canada’s position that the activity of being on standby to provide a service is considered to be coasting trade and that a licence needs to be obtained before the vessel commences its activities or operations. She noted again that vessels not in compliance can face detention and associated penalties.
[41] By email of August 29, 2017, Global Marine sought a meeting.
[42] By email of August 30, 2017, Ms. Gelinas acknowledged the request and stated that “[w]e remain open to dialogue with Global Marine” and that Transport Canada was available to meet on September 6, 2017. Further:
The purpose of the meeting will be for Global Marine to provide broader awareness of CS INNOVATORS activities and for Transport Canada to ensure that Global Marine has clarity on what constitutes a coasting trade activity under Canada’s Coasting Trade Act. In advance of the meeting, we ask that Global marine provide us with any additional information that will need to be considered during our meeting.
[43] Global Marine provided further information on September 1, 2017. The meeting was held on September 6, 2017, and on the same date Global Marine provided Transport Canada with a copy the presentation it had made at the meeting.
[44] Ms. Gelinas acknowledged the information by email of September 7, 2017 and stated that Transport Canada would review it.
[45] Global Marine followed up by emails on October 6, 2017 and on October 11, 2017. In the latter email, it inquired if Ms. Gelinas had decided her position with respect to the “Cable Innovator” requiring a permission under the Coasting Trade Act to simply be in Canadian waters in port awaiting repair jobs and that Global Marine “need that formal decision in order to help decide how we will move forward”.
[46] By email of October 11, 2017, Ms. Gelinas stated that Transport Canada was still looking into it and were doing their best to get back to Global Marine as soon as possible.
[47] On July 4 and 5, 2018, Global Marine wrote to the Minister. It stated that it had the benefit of having a cable ship based in Victoria since the late 1970s. And, while there had been no change in the statutory regime nor in Global Marine’s operating practices, in May 2017 Transport Canada advised that a C48 coasting trade licence was required for the “Cable Innovator” while it is sitting idle in Victoria Harbour. Global Marine attached a five-page memorandum outlining why it did not agree with Transport Canada’s position that, in so doing, the vessel was engaged in a “marine activity of a commercial nature” pursuant to s 2(1)(f) of the Coasting Trade Act. Global Marine asked the Minister to confirm that while sitting idle the “Cable Innovator” was not subject to s 2(1)(f).
[48] On October 12, 2018, Ms. Gelinas sent an email to Global Marine apologising for the delay in reply and stating that she would like to schedule a meeting to discuss the operating of the “Cable Innovator” at the port of Victoria. Global Marine responded on October 15, 2018, and again on November 8, 2018, indicating willingness to meet and that it would be helpful to know the specific topics to be covered in advance of the meeting.
[49] On November 9, 2019, Mr. Marc-Yves Bertin wrote to Global Marine identifying himself as the Director General responsible for Marine Policy at Transport Canada. He stated that it would be important for his team to meet with Global Marine to discuss Global Marine’s letter to the Minister but that in anticipation of the meeting, “I should reconfirm that the activity of ‘keeping the vessel on permanent standby to attend very short notice cable repairs as specified by the cable owners contracts’ — which was noted in your most recent coasting trade application submitted to the Canadian Transportation Agency on September 21, 2016 — meets the definition of coasting trade found under section 2(1)(f) of the Coasting Trade Act. Therefore, when the Cable Innovator is in Canadian waters on standby, a coasting trade licence is required.”
[50] On February 27, 2019, Global Marine met with the Assistant Deputy Minister of Transport Canada to discuss the issue. On March 25, 2019, at the Assistant Deputy Minister’s request, Global Marine provided its written submission outlining why it held the view that sitting idle on standby is not a marine activity of a commercial nature and, consequently, does not require a C48 licence. This included the rejection of Transport Canada’s interpretation of s 2(1)(f) and Global Marine’s view of how the section is properly interpreted.
[51] The next communication was the June 20, 2019 email from Ms. Gelinas, which is reproduced above.
[52] I am not persuaded that the June 20, 2019 email, which marked the culmination of an extended discussion, can be properly analogized to a courtesy letter. Courtesy letters are typically written in reply to a request that a prior decision be reconsidered.
[53] For example, in Hughes v Canada (Customs and Revenue Agency), 2004 FC 1055, referenced by the Minister, pursuant to an internal selection process the applicant had been determined to be an unqualified for a position with Canada Customs and Revenue Agency (“CCRA”). He did not seek judicial review of that decision. Instead, he sought to have the decision re-opened by writing a letter complaining about the selection process. This resulted in a letter in response from the Assistant Commissioner of the Human Resources Branch of the CCRA explaining that, according to the staffing program, there was no further available recourse.
[54] The applicant attempted to characterize that letter as a decision subject to judicial review. This Court did not agree stating:
[6] I agree with the Respondent that, at most, Mr. Tucker's letter is a courtesy letter. The case law is clear that a courtesy letter written in response to a request for reconsideration is not a decision or order within the meaning of the Federal Court Act, and, therefore, cannot be challenged by way of judicial review (Batkai v. Canada (M.C.I.), 2002 FCT 514 at para. 13 (F.C.T.D.); Krishnamurthy v. Canada (M.C.I.) [2000] F.C.J. No. 1998 (Q.L.) at para. 14 (F.C.T.D.); Brar v. Canada (M.C.I.) (1997), 140 F.T.R. 163 at paras. 7-9 (F.C.T.D.)).
[55] Similarly, Brar v Canada (Minister of Citizenship and Immigration), 140 FTR 163, [1997] FCJ No 1527 (FCTD) (QL/Lexis), also relied upon by the Minister, concerned the judicial review of a decision of a visa officer refusing to reconsider the refusal of the applicant’s application for permeant residence. There this Court held that:
[7] In these proceedings the applicant Brar is not challenging the visa officer's refusal letter of January 23, 1996. He is rather, challenging the letter of July 8, 1996, which refused the request for reconsideration. The respondent characterizes that letter as simply a “courtesy response”, which does not constitute a “decision” as that phrase is employed in section 18.1 of the Federal Court Act.
[8] I agree with the respondent. This view is supported by the decision of Noël J. in Dumbrava v. M.C.I., where it was decided that when there is a fresh decision based on new facts, there is always “a fresh exercise of discretion”. In the case at bar, the visa officer did not refer to any new facts or submissions nor did she state that she was reconsidering her decision. As was stated by McKeown, J. in Dhaliwal v. M.C.I., counsel cannot extend the date of decision by writing a letter with the intention of provoking reply".
[9] On this record, there is nothing to explain why Brar’s counsel did not file a timely application for judicial review or an application for extension of time.