Canadian Arab Federation v. Canada (Citizenship and Immigration)

Canadian Arab Federation v. Canada (Citizenship and Immigration)
Court (s) Database
Federal Court Decisions
Date
2013-12-23
Neutral citation
2013 FC 1283
File numbers
T-447-09
Decision Content
Date: 20131223
Docket: T-447-09
Citation: 2013 FC 1283
Ottawa, Ontario, December 23, 2013
PRESENT: The Honourable Mr. Justice Zinn
BETWEEN:
CANADIAN ARAB FEDERATION (CAF)
Applicant
and
THE MINISTER OF CITIZENSHIP AND IMMIGRATION
Respondent
REASONS FOR JUDGMENT AND JUDGMENT
[1] This is an application for judicial review by the Canadian Arab Federation [CAF] of a decision by The Minister of Citizenship and Immigration, then Jason Kenney [the Minister], not to enter into a funding agreement under the Language Instruction for Newcomers to Canada [LINC] program for the year 2009-2010. This decision was made by the Minister despite the fact that Citizenship and Immigration Canada [CIC] had previously entered into similar funding arrangements with CAF for many years; the most recent of which expired March 30, 2009, just days after the decision under review was made.
[2] The reasons for the Minister’s decision are set out in a letter to CAF dated March 18, 2009, from the Associate Assistant Deputy Minister of CIC to Khaled Mouammar, President of CAF at that time:
As you are also aware, serious concerns have arisen with respect to certain public statements that have been made by yourself or other officials of the CAF. These statements have included the promotion of hatred, anti-semitism [sic] and support for the banned terrorist organizations Hamas and Hezbollah.
The objectionable nature of these public statements – in that they appear to reflect the CAF’s evident support for terrorist organizations and positions on its part which are arguably anti-Semitic – raises serious questions about the integrity of your organization and has undermined the Government’s confidence in the CAF as an appropriate partner for the delivery of settlement services to newcomers.
Background
Nature of CAF
[3] CAF’s objectives as set out in its Letters Patent, relate to advancing the interests of Arabs and Arab communities in Canada in various ways, including “[t]o promote ties and mutual understanding between Arab societies, organizations and communities in Canada and the Arab homeland … to provide assistance to new immigrants to Canada from the Arab homeland … [and] to disseminate information about and encourage support for Arab causes in Canada and the Arab homeland, particularly the cause of the suffering Palestinian people.”
[4] CAF’s operation had two branches: Settlement Services and Immigrant Support, and Community Engagement. Settlement Services and Immigrant Support was directed towards assisting both Arab and non-Arab newcomers integrate into the community. Community Engagement was directed towards capacity building, advocacy, and community services.
[5] CAF delivered two main programs under its Settlement Services branch: LINC, which provided English as a second language training to newcomers, and Job Search Workshops [JSW]. Most of the newcomers attending these programs were originally from non-Arab countries. CAF received funding for both of these programs from CIC by way of contribution agreement arrangements.
CIC Contribution Agreements
[6] CIC contracted with CAF and others as private service provider organizations for the provision of settlement services to newcomers to Canada. The contracts provided for an amount of funding allocated to the service provider for reimbursable expenses. An expense unrelated to the LINC or JSW programs cannot be recovered from the funds earmarked in the contribution agreement. As was noted by the Minister in his memoranda, a party to a contribution agreement does not financially benefit from the agreement; however, there may be indirect benefits:
None of the funds provided by Canada through the contribution agreement was [sic] intended to benefit the CAF. An organization may attain incidental advantages as a result of settlement funding; for example, there may be legitimacy attached to organizations who receive government funds and there may be an opportunity to share infrastructure costs with the settlement program. The full amount of the contribution agreement, however, is intended to directly benefit newcomers taking LINC classes.
[7] It is also relevant to this application and it is the Minister’s position, that the LINC program offers newcomers more than just language training. The Minister points out that it is intended that the program will also provide newcomers with an orientation to the Canadian way of life including “social, economic, cultural and political integration,” and therefore the suitability of the program provider in this respect is critical. The CIC Application Package given to service providers sets out this facet of the program, as follows:
By providing basic language instruction to adult newcomers in English or French, LINC facilitates the social, cultural[,] political and economic integration of immigrants and refugees into Canada. In addition, LINC curricula include information that helps newcomers become oriented to the Canadian way of life. This, in turn, helps them to become participating members of Canadian society as soon as possible.
[8] CAF had most recently negotiated a contribution agreement and signed a contract with CIC for the period April 1, 2007 to March 31, 2009. On December 2, 2008, CIC wrote to all parties in receipt of LINC funding at that time, informing them that a new settlement program would be forthcoming but its implementation was still underway. As a consequence, “CIC has decided to extend current LINC contribution agreements to March 31, 2010.” Each service provider was asked to submit a budget application and propose revised activities to CIC, which application was subject to an approval process.
[9] In the information accompanying this request for applications for amendment, CIC cautioned CAF and other applicants not to assume approval for the 2009-2010 year, unless and until such approval was received in writing from CIC:
Do not assume that your application for amendment is approved until you are notified in writing by CIC. Any expenditures incurred prior to the approved start-up date are your own responsibility and will not be reimbursed. We also ask you not to hire staff or make any commitments until you have been informed of CIC’s approval. If your application is approved, it will then be used to amend your current Contribution Agreement between your organization and Citizenship and Immigration Canada.
[10] CAF submitted a proposal for 2009-2010 on December 9, 2008. On February 12, 2009, a settlement officer from CIC recommended its approval. He noted in that recommendation that “[t]he Canadian Arab Federation delivers a good quality LINC program” and that despite a request for an annual increase to salaries of 2.5%, the proposal for 2009-2010 was $50,000 less than the previous year. The settlement officer emailed an unexecuted final draft of the further agreement to CAF; however, given the value of the proposed contract, final approval was required by the Minister or his delegate.
[11] There is nothing in the record, nor was it submitted by CAF, that CIC ever represented that final approval had been given. In fact, even though contractual negotiations had been concluded and the proposal endorsed by a settlement officer, the proposal still had to be approved and endorsed by a review officer, the local manager, and the regional director before CIC National Headquarters and the Minister’s office would be notified of it. If the regional director endorsed the proposal, he had authority to approve and execute the agreement at that stage; however, CAF’s proposal never made it to this stage of the process. CAF’s proposal had been approved by a settlement officer on February 12, 2009 and a review officer on February 16, 2009, but before it was sent to a local manager, CIC National Headquarters intervened and raised concerns about continuing to fund CAF.
Events Prior to Minister Kenney’s Appointment as Minister of CIC
[12] Jason Kenney became the Minister of CIC, responsible for the Immigration and Refugee Protection Act, SC 2001, c 27 [the Act] on October 30, 2008. He was preceded in that office by Diane Finley. On August 7, 2008, Minister Finley issued a Press Release in which she stated that “[t]o help newcomers settle in the community of Scarborough in the City of Toronto, the Government is committing more than $10 million over the next two years (through to 2010) to six agencies that provide settlement services.” The Press Release went on to list the “six agencies receiving the funding in today’s announcement.” CAF was one of the listed agencies, and was adjacent to the figure of $2,544,815.
[13] Mohamed Boudjenane, National Executive Director of CAF, attests in his affidavit that this announcement led CAF to believe that it was to be funded for 2009-2010 and the finalization of the details would be a mere formality:
The funding was originally meant to continue for two years but in the second year, 2008, there was an announcement that it was to continue into a third year to 2010. The Minister of Citizenship and Immigration, Diane Finlay [sic], made a public announcement on August 7, 2008 to this effect… It was certainly the basis upon which CAF operated. Both myself and Sara Amash, the project and program manager for CAF were led to believe that the funding for 2009-2010 would continue as previously approved and that it was merely a formality to finalize the details of the contract for that year.
[14] In contrast, Lee Bartlett, Director of Operations for Settlement Services for the Toronto and York offices of CIC, attests in his affidavit, sworn September 22, 2009, that the breakdown of the $2,544,815 figure in the Minister’s Press Release is made up of funding to CAF under both the LINC program and under the Immigration Settlement and Adaption Program [ISAP], as follows, none of which relates to LINC funding for 2009-2010:
FY1 07/08
FY2 08/09
FY3 09/10
TOTAL
LINC
$1,045,782
$1,037,505
N/A
$2,083,287
ISAP
$ 130,804
$ 166,581
$164,179
$ 461,564
[15] The total of the funding in Mr. Bartlett’s chart is $2,544,851 - $46 greater than the Minister’s announced funding for CAF. Nevertheless, I find that the Press Release could not have led CAF to believe that it had secured LINC funding for 2009-2010, as is alleged by Mr. Boudjenane. The reference to funding for 2009-2010 in the Press Release referred to ISAP funding. Mr. Bartlett was cross-examined on his affidavit and his evidence was unshaken that the figure did not include 2009-2010 LINC funding because no decision had been made to extend previous LINC agreements, nor had any such announcement been made at the date of the Press Release:
In August 2008, not even a negotiation or even a call for proposals around an extension or even decisions around how we would extend LINC for 2009/10 had been made or announced, and the LINC agreement that was in place at the time of August for CAF ran for 2007/08 and 2008/09, whereas the ISAP agreement for CAF ran 2007/08 to 2009/10, inclusive.
…
[T]he Minister would not make an announcement that agreements had been reached around funding until such an agreement had been put in place. …[I]t wouldn’t have been possible for the Minister to have made an announcement around LINC for 2009/10 for CAF if we hadn’t even – or CIC, sorry, hadn’t even at that point set out the process for entering into further agreements, and equally hadn’t received any proposal from CAF at that point in relation to the amounts that it would seek for LINC in 2009/10 for further agreements.
The Minister’s Position on Government Funding
[16] Alykhan Velshi, the Minister’s Communications Director, attests in his affidavit, that since he began working for the Minister in 2007 (the Minister at that time was the Secretary of State for Multiculturalism), the Minister has held the view that the Crown should not be funding certain organizations:
[W]hile private citizens and organisations are free to express their opinions, no individual or organisation is entitled to a financial subsidy from taxpayers. To that end, groups that promote hatred, including anti-Semitism, or excuse terrorism and violence should not receive any official recognition or subsidy from the state.
[17] Mr. Velshi points to a number of public statements by the Minister in support of this assertion. For example, on February 17, 2009, at a conference in London, England, the Minister gave a speech in which he made the following statement:
There are organisations in Canada, as in Britain, that receive their share of media attention and public notoriety, but who, at the same time as expressing hateful sentiments, expect to be treated as respectable interlocutors in the public discourse.
…
I think as well of the leader of the Canadian Arab Federation, who notoriously circulated an e-mail when my colleague, our shadow Foreign Minister, Bob Rae, was running for the leadership of his party, calling on people to vote against Mr. Rae because of Arlene Perly Rae’s involvement in Canada’s Jewish Community. The same individual, the same organisation, the Canadian Arab Federation, just last week circulated – including to all parliamentarians – videos which include propaganda, including the inculcation to hatred, of children by organisations such as Hamas and Islamic Jihad.
These and other organisations are free within the confines of our law and consistent with our traditions of freedom of expression, to speak their mind, but they should not expect to receive resources from the state, support from taxpayers or any other form of official respect from the government or the organs of our State. [emphasis added]
[18] A week later, on February 24, 2009, during Question Period, the Minister was asked about funding for certain organizations. The Member asking the question stated that “the Canadian Arab Federation recently circulated videos from banned terrorist organizations, such as Hamas and Islamic Jihad, called Israel a ‘racist state’, and attacked a member of the House because of his wife’s involvement in the Jewish community.” He then asked: “What is the government’s position on whether such groups should receive taxpayer support?” The Minister responded: “[T]he Government of Canada should take a zero tolerance approach to organizations that make excuses for terrorism, for violence, for hatred and for anti-Semitism. … From our point of view, these groups do not deserve and have no right to taxpayers’ dollars to promote their kind of extremism.” The Minister expressed similar sentiments during radio interviews he gave on March 2, 2009, and March 6, 2009.
[19] On March 10, 2009, at the Standing Committee on Citizenship and Immigration, the Minister outlined his reason for refusing to extend funding to CAF for 2009-2010:
The very first day I arrived at Canadian Heritage as the secretary of state responsible for the multiculturalism program, I received a briefing on grants and contributions. I indicated to the officials that I wanted to ensure that we were not providing grants and contributions to organizations that make excuses for, or apologize for, violence or terrorism, or organizations that are terrorist or that promote hatred. I mentioned, in particular, Mr. Mohamed Elmasry of the Canadian Islamic Congress because of his remarks that Israelis over the age of 18 are legitimate targets for elimination.
I further mentioned, in particular, Mr. Khaled Mouammar, president of the Canadian Arab Federation - this was a discussion I had with my officials in January 2007 - because of his circulation, during the 2006 Liberal leadership convention, of a flyer that attacked Bob Rae, a respected member of this Parliament, because of his wife's involvement in the Jewish community. Following the circulation of that flyer, Liberal Senator Yoine Goldstein referred to this flyer as “racist filth”. It was my view then, and it's remained my view since, that we ought not to finance organizations that promote extremism or hatred - in this case, hatred toward Jewish people in particular - or who publicly support a banned, illegal terrorist organization.
Mr. Mouammar has a long record of public comments expressing support for Hamas and Hezbollah, which are two banned, illegal, and essentially anti-Semitic terrorist organizations. He has referred to Israel as a racist state and he has called for the end of Israel as a Jewish state. In my judgment, these and other comments of his are beyond the pale.
Do I suggest that we should have a test on political opinions for the office-holders of NGOs that receive grants and contributions? No, absolutely not. People are free to say what they like within the bounds of our laws. People are free to criticize cabinet ministers or the government. But I do not believe we have any obligation to provide subsidies to individuals who use their organizations as platforms to promote extremism or hatred or to apologize for terrorism.
That's the view I articulated in January 2007 at Canadian Heritage. As a result, we provided no funding to these organizations. That's also the view I articulated recently at the London conference on anti-Semitism. I have also articulated this to my officials. I have asked my department to find ways in which we can include the promotion of hatred or apologizing for terrorism as some of the criteria used in considering applicants for grants or contributions.
The Minister’s View of CAF
[20] The Minister was clearly aware of CAF before he became Minister of CIC; however, he only became aware that CIC was funding CAF on February 2, 2009. Upon the Minister becoming aware, he emailed his Chief of Staff expressing his position on CAF and the funding agreement, as follows:
… I am unclear who in our office has the lead on settlement funding.
In any event, please ask the Dept to bring forward complete information on the contribution embarrassingly approved by our government for the radical and anti-semitic [sic] Canadian Arab Federation
This is the same group whose President attacked Bob Rae because his wife is jewish [sic], and who now is calling me a “professional prostitute” (I guess that’s better than being an amateur!)
I would like to know the status of their contribution agreement with CIC to see if they are in breach in any possible respect. I want to pursue all legal means to terminate this shameful funding arrangement, and to ensure that it is not renewed. [internet references omitted]
[21] The decision under review does not set out the specific conduct or events that the Minister took into consideration in reaching his decision not to fund CAF. Alykhan Velshi, the Minister’s Communications Director, testified that the statements relied on to reach the conclusion that CAF’s statements “have included the promotion of hatred, anti-semitism [sic] and support of the banned terrorist organizations Hamas and Hezbollah,” included the following six matters.
1. The Bob Rae Flyer
[22] In 2006, during the Liberal Party Leadership Convention, CAF’s President, Khaled Mouammar, using his personal email account, forwarded a leaflet that attacked Bob Rae and his wife for involvement in the Jewish community. The flyer was originally produced and emailed by a man who was not associated with CAF. The flyer contains the following text over a picture of Bob Rae:
Bob Rae was a keynote speaker for the [Jewish National Fund of Canada], a group shown by Israeli scholars to be complicit in war crimes and ethnic cleaning.
Rae’s wife is a Vice President of the [Canadian Jewish Congress], a lobby group which supports Israeli Apartheid and Israel’s illegal Apartheid Wall.
President Carter has condemned Israeli Apartheid.
Bob Rae supports Israeli Apartheid.
Don’t elect a leader who supports Apartheid!
[23] The distribution of the Bob Rae Flyer to delegates was reported by Canadian Press:
“Bob Rae was the target of anti-Semitic attacks during the Liberal leadership contest, motivated at least in part by the fact that his wife is Jewish.” When contacted by Canadian Press, CAF denied producing or distributing the flyer but later issued a press release stating: “CAF believes that Canadians have a right to know the factual information provided” in the flyer.
[24] Mr. Velshi testified that the Bob Rae Flyer formed part of the basis for the Minister’s decision as it attacked Mr. Rae because of his wife’s involvement in the Jewish community, and specifically the Canadian Jewish Congress. In Mr. Velshi’s view, the Bob Rae Flyer was anti-Semitic and thus a form of hatred.
2. Rallies in January 2009
[25] In January 2009, CAF in conjunction with other organizations, organized several rallies where some protestors (who were not related to CAF) held offensive placards and shouted repugnant slogans. Some participants were seen holding signs equating Israelis to Nazis, some were screaming vulgarities like “Jewish child, you are going to fucking die. Hamas is coming for you. Fuck off.” Hezbollah flags were flying in the background, and some signs likened Zionism to Nazism and terrorism.
[26] It was during one of these rallies that Mr. Mouammar described the Minister, among others, as a professional whore of war:
We have politicians who are professional whores who support the war [i.e. the Israel-Palestine conflict] as Norman Finkelstein said at that lecture at the University of Toronto. These are, these are people like Peter Kent across the street, like Jason Kenney, like Michael Ignatieff, who only had to say while Israel was murdering women and children with phosphorous bombs burning their fleshes, the only thing these, these, professional politicians; who are whores, whores of war, the only thing they had to say was that Israel had the right to defend itself by killing women and children with phosphorous bombs.
The Minister denies that this derogatory name calling triggered or played a part in his decision. Given that he had made statements regarding government funding to CAF as early as 2007, there is no reason to question his assertion.
3. The 2007 Cairo Conference
[27] Ali Mullah, Vice President of CAF at the time, attended the Cairo Conference, which described itself as an “international peace conference.” It was attended by many people with different backgrounds, including some Jewish participants. The conference was also attended by delegates from Hamas, Hezbollah, Jemaah Islamiyya, and the Palestine Liberation Front - four organizations on Canada’s list of terrorist organizations. Although it was reported that CAF had sent Mr. Mullah as its delegate, it was later confirmed that he attended in his personal capacity, and not as a representative of CAF.
4. Distribution of Links from Terrorist Organizations
[28] On February 2, 2009, the Minister became aware that CAF, in its Daily Gaza Bulletin and its webpage, had links to web sites that featured videos with images of Hamas operatives undergoing training and which depicted flags of Hamas and Islamic Jihad. CAF asserts that it never endorsed the contents of the videos in the links it posted and transmitted; rather it simply directed readers to facts so that they could form their own opinions on the issues.
5. Honouring Zafar Bangash
[29] CAF, at its 40th Anniversary Gala, honoured Zafar Bangash, who is otherwise not affiliated with CAF. Mr. Bangash has referred to Canadians as “infidels or non-believers” in the past and reported on the September 11 attacks in a way that was unsympathetic to the victims.
6. Essay Contest
[30] CAF sponsored an essay contest (with two other organizations) on the “ethnic cleansing” of Palestine. The timing of this contest coincided with the 60th anniversary of the establishment of Israel as a state. The Minister contends that the use of the term “ethnic cleansing” assumes that Jewish people are engaged in genocide and constitutes anti-Semitism.
[31] Collectively, these six incidents formed the basis for the Minister’s decision.
CAF Requests to Meet with the Minister
[32] On March 2, 2009, the President of CAF wrote to the Minister requesting a meeting:
It is important that CAF’s working relationship with you and the Ministry of Immigration is based upon mutual respect and proactive outreach on both sides to the benefit of Arab Canadian communities on the whole. CAF is therefore requesting a meeting with you in the presence of other concerned Arab Canadians. This meeting will be a great opportunity to enhance and strengthen our working relationship.
The Minister did not respond.
[33] The letter does not indicate why it was sent at that time; however, it is noteworthy that it was sent two weeks following the Minister’s speech in London where he said, with reference to CAF and others, that while they are at liberty to engage in free speech within the law, “they should not expect to receive resources from the state, support from taxpayers or any other form of official respect from the government or the organs of our state.”
[34] It is against this backdrop that the following issues arise.
Issues
[35] The six issues raised by CAF in its written memorandum can be collapsed and addressed within a discussion of the following four questions:
a. Did the Minister owe CAF a duty of procedural fairness, and if so, was it breached?
b. Is the Minister’s decision not to enter into a funding agreement with CAF under the LINC program tainted by a reasonable apprehension of bias?
c. Was CAF’s section 2(b) Charter right to freedom of expression engaged, and if so, was that right infringed, and, was the infringement justified?
d. Was the Minister’s decision reasonable?
1. Did the Minister owe CAF a duty of procedural fairness?
[36] CAF submits that the Minister owed it a duty of fairness because:
1. A duty of fairness is imposed on every public authority making an administrative decision which is not of a legislative nature and which affects the rights, privileges or interests of an individual: Cardinal v Kent Institution, [1985] 2 SCR 643 at 653 [Cardinal];
2. CAF had received funding for the LINC program without any issues for twelve consecutive years;
3. CAF had a legitimate expectation that funding would be renewed because of its history with CIC and because the contract for 2009-2010 had been negotiated and was awaiting final approval; and
4. Final approval had historically been a formality after the contract’s terms had been negotiated and the Minister rarely intervened at any stage.
[37] The Minister submits that no duty of fairness was owed to CAF because:
1. The relationship between CAF and CIC was purely contractual in nature and no duty of fairness is owed by the government when it is exercising its contractual rights in the same manner as an ordinary citizen: Dunsmuir v New Brunswick, 2008 SCC 9 at paras 103-104, [2008] 1 SCR 190 [Dunsmuir];
2. The funding period under the last executed agreement between CIC and CAF for the provision of LINC services expired on March 31, 2009, no new agreement had been executed, and CAF was specifically advised that approval could not be taken for granted; and
3. There is no obligation on CIC to enter into a new agreement with any party, or to renew an existing agreement that is set to expire, merely because it is a government institution.
[38] The following provides the reasons for my conclusion that the Minister did not owe a duty of procedural fairness to CAF. In summary, it is because the nature of the relationship was strictly commercial. There is no statutory provision that imposes procedural fairness obligations in relation to contribution agreements, nor is there any contractual provision set out in the call for proposals or the contribution agreements themselves that stipulates that service provider organizations will be treated in a procedurally fair manner. Finally, according procedural rights in what is essentially a strictly commercial context would unduly burden the Minister, particularly where the window for making a decision is short and there are greater public policy considerations which the Minister must weigh. In such a context, the parties’ rights are best protected by a reviewing court’s assessment of the reasonableness of the decision, not by extending procedural rights where none would otherwise exist.
[39] When determining whether a duty of procedural fairness applies to the decision under review, one must first determine the nature of the relationship between the affected person and the public authority.
[40] In Knight v Indian Head School Division No 19, [1990] 1 SCR 653 at 669, the Supreme Court, relying upon the decision of Justice LeDain in Cardinal at 653, stated that whether the duty of fairness exists will be dependant upon “the consideration of three factors: (i) the nature of the decision to be made by the administrative body; (ii) the relationship existing between that body and the individual; and (iii) the effect of that decision on the individual's rights.”
[41] In Dunsmuir at para 114, the Supreme Court noted an exception to this broad statement of principle [the Dunsmuir exception]. Dunsmuir involved the dismissal of an employee from his employment with the province:
The principles expressed in Knight in relation to the general duty of fairness owed by public authorities when making decisions that affect the rights, privileges or interests of individuals are valid and important. However, to the extent that the majority decision in Knight ignored the important effect of a contract of employment, it should not be followed. Where a public employee is protected from wrongful dismissal by contract, his or her remedy should be in private law, not in public law. [emphasis added]
[42] CAF submits that the Dunsmuir exception does not apply to the relationship between CAF and CIC. CAF relies on the Supreme Court of Canada’s decision in Canada (Attorney General) v Mavi, 2011 SCC 30, [2011] 2 SCR 504 [Mavi] for the proposition that the Dunsmuir exception to the duty of fairness was intended to be narrow and specific to the employment context and therefore does not apply to this case. In particular, the Supreme Court in Mavi held, at para 51, that:
The situation here does not come close to the rather narrow Dunsmuir employment contract exception from the obligation of procedural fairness. As the Dunsmuir majority itself emphasized:
This conclusion does not detract from the general duty of fairness owed by administrative decision makers. Rather it acknowledges that in the specific context of dismissal from public employment, disputes should be viewed through the lens of contract law rather than public law. [Emphasis added; para. 82.]
Dunsmuir was not intended to and did not otherwise diminish the requirements of procedural fairness in the exercise of administrative authority. [emphasis in original]
[43] In my view, the Dunsmuir exception is not as narrow as CAF submits. I find support for this view in the decision of the Federal Court of Appeal in Irving Shipbuilding Inc v Canada (Attorney General), 2009 FCA 116, [2010] 2 FCR 488 [Irving Shipbuilding], wherein Justice Evans for the Court and with reference to Dunsmuir, stated at para 60 that the broader point made in that case “is that when the Crown enters into a contract, its rights and duties, and the available remedies, are generally to be determined by the law of contract.” I also agree with Justice Evans’ statement at para 45 that “[t]he common law duty of fairness is not free-standing but is imposed in connection with the particular scheme in which the impugned administrative decision has been taken.”
[44] In Mavi, unlike in Irving Shipbuilding, while the parties’ relationship was governed by a contract, it was also inextricably rooted in statute, as was noted by the Court at para 2:
The present proceedings were initiated by eight sponsors who denied liability under their undertakings. As will be explained, the undertakings are valid contracts but they are also structured, controlled and supplemented by federal legislation. The debts created thereby are not only contractual but statutory, and as such their enforcement is not exclusively governed by the private law of contract. The issue raised by this appeal is the extent to which, if at all, the government is constrained by considerations of procedural fairness in making enforcement decisions in relation to these statutory debts. [emphasis added]
In my view, the fact that the contracts were grounded and rooted in statute distinguishes Mavi from Irving Shipbuilding and from this case. The undertakings in Mavi were not of a strictly contractual nature. In fact, the Supreme Court in Mavi distinguished Dunsmuir on this basis, stating at para 47:
The Attorneys General resist the application of a duty of procedural fairness in part on a theory that the claims against the sponsors are essentially contractual in nature. Dunsmuir, they say, stands for the proposition that procedural fairness does not apply to situations governed by contract. However, in this case, unlike Dunsmuir, the governments' cause of action is essentially statutory. [emphasis added]
[45] Unlike in Mavi, one cannot say that the relationship of the parties in this case is “structured, controlled and supplemented by federal legislation,” or that the cause of action is essentially statutory. The Settlement Manual—a guidebook given to settlement officers for evaluating applications for funding—states that “[w]ith the establishment of the Department of Citizenship and Immigration in 1950, the federal government made provisions in its Annual Estimates for payments to not-for-profit organizations in order to provide settlement services to immigrants in Canada.” These settlement programs fall within the Act’s objectives in section 3, most particularly the objective “to promote the successful integration of permanent residents into Canada.” The parties have not pointed to any other statutory provision relevant to LINC funding. Accordingly, there is no statutory provision governing procedural fairness in relation to the possible extension of the term of an existing contribution agreement.
[46] In this case, the parties were in a purely contractual relationship at the time the Minister made his decision. CAF was a party to a LINC funding contract with CIC, ending March 31, 2009. There was no provision in that contract for the automatic renewal or extension of that term. However, as a consequence of that contractual relationship, CAF was invited to submit a proposal for an amendment to the contract to extend its term for one year. CAF was informed that its contract with CIC would be extended to March 31, 2010, subject to an application being submitted and “approved.” Despite the negotiations for 2009-2010 having been completed, the fact remains that no contract for funding for 2009-2010 had been approved or executed, and it had been made clear to CAF in both the Guidelines for Amendments: Language Instruction for Newcomers to Canada (LINC) 2009-2010, and subsections 4.6 and 12.5 of the 2007-2009 contribution agreement, that it should not expect any additional funding beyond March 31, 2009, until it was notified in writing that the application for an amendment to extend the term of the existing contract had been approved.
[47] There was nothing in the documents sent to CAF that committed CIC to amend the existing contract. The letter from CIC indicating that the contract term of CAF’s existing contribution agreement could be extended is akin to a request for the submission of a proposal and, as was held in Irving Shipbuilding, arguably creates a contract when the recipient responds. In this case, that contract contains no express promise that parties responding will be treated in a procedurally fair manner.
[48] CAF points out that there was nothing in the document package to indicate that organizations that were considered by the Minister to be anti-Semitic or supporters of terrorism would not be granted a contract extension. Equally there was nothing in the package that indicated that approval by the Minister would be automatic even if his officials were otherwise satisfied with the proposal.
[49] Accordingly, to the extent that the parties’ relationship was a commercial and contractual relationship, there is nothing in the record that suggests that there was any obligation on the Minister to engage with CAF about his concerns prior to making his decision not to extend the existing contract’s term. There is neither a statutory or contractual basis on which this Court can impose on a duty of procedural fairness on the Minister.
Implied Duty of Fairness
[50] The question remains whether there is any implied duty of procedural fairness. I find that there is no implied duty in this case for many of the reasons the Court found that there was no implied duty of fairness in Irving Shipbuilding.
[51] First, this is essentially a commercial relationship, notwithstanding the fact that the service provider makes no profit from the agreement. As Justice Evans stated at para 46 of Irving Shipbuilding: “It will normally be inappropriate to import into a predominantly commercial relationship, governed by contract, a public law duty developed in the context of the performance of governmental functions pursuant to powers derived solely from statute.”
[52] Second, if CAF is awarded procedural rights in this context, it would open the door to every failed applicant for a contribution agreement being entitled to at least notification that their proposal was not going to be accepted and an opportunity to address the reasons why. Such an obligation on the Minister would unduly delay his decisions in a process when, as in this case, the time for a decision is short. Further, it opens the door to what Justice Evans called a “cascading array of potential procedural rights-holders.” Where there are more persons seeking funding than funds available, any change in decision by the Minister leads automatically to a subsequent failed applicant. If procedural fairness is extended to the initial failed applicant, the same safeguards must be extended to the subsequent failed applicants.
[53] Third, as was submitted by the Minister, a decision on funding settlement programs for newcomers to Canada involves broader public policy considerations; there is more at stake than just the relationship between the service provider and CIC. Those who enrol in the LINC program are to be orientated to the Canadian way of life and therefore the suitability of the program provider is critical. The question of whether a particular organization is best suited to act as a beacon of Canadian values in the provision of settlement services (even when its second-language training program is otherwise fully acceptable), is not something subject to judicial review on procedural grounds. The Applicant’s interests - to the extent that they have interests at all - are protected from capricious decision-making under the reasonableness standard, not by affording it procedural fairness.
[54] Even if the nature of the relationship between CIC and CAF was other than that of a commercial contract, and even if the Dunsmuir exception was read to apply as narrowly as CAF submits, I nevertheless would have found that CAF does not have a right, privilege, or interest that is affected by the decision sufficient to impose a duty of fairness on the Minister.
[55] The Supreme Court held in Cardinal that a duty of fairness is imposed on every public authority making an administrative decision which is not of a legislative nature and which affects the rights, privileges or interests of an individual. This language was tracked in the Supreme Court’s decision in Knight, when it stated that the effect of the decision on the individual's rights is a factor to be cons