Air Canada v. Toronto Port Authority

Air Canada v. Toronto Port Authority
Court (s) Database
Federal Court Decisions
Date
2010-07-21
Neutral citation
2010 FC 774
File numbers
T-488-10, T-692-10
Notes
Digest
Decision Content
Federal Court
Cour fédérale
Date: 20100721
Dockets: T-488-10
T-692-10
Citation: 2010 FC 774
Toronto, Ontario, July 21, 2010
PRESENT: The Honourable Mr. Justice Hughes
BETWEEN:
AIR CANADA
Applicant
and
TORONTO PORT AUTHORITY
and PORTER AIRLINES INC.
Respondents
REASONS FOR JUDGMENT AND JUDGMENT
[1] These two applications have been brought by Air Canada and were heard together on common evidence. Both deal with certain steps taken by the Respondent Toronto Port Authority in respect of commercial airport operations carried out at the Toronto Island Airport, now known as Billy Bishop Toronto City Airport. The other Respondent Porter Airlines Inc. is, at present, the only commercial passenger airline operating out of that airport.
[2] For the reasons that follow, I find that the applications are dismissed.
I. The Applications
1) T-488-10
[3] This application deals with what Air Canada characterizes as a decision made by Toronto Port Authority dated December 24, 2009. On that day, TPA released a bulletin entitled:
TPA announces capacity assessment results for Billy Bishop Toronto City Airport, begins accepting formal carrier proposals
That bulletin read:
Third-party, IATA-accredited slot coordinator will be appointed in early 2010 to manage carrier demand and slot allocation process
Toronto – The Toronto Port Authority (“TPA”) today confirmed that it has received a preliminary executive summary outlining the results of an updated noise impact study and capacity assessment for the Billy Bishop Toronto City Airport (“BBTCA”). The findings of the third-party study will now be refined to determine the number of daily commercial flights and equipment mix that can be accommodated at the airport during the coming years.
The comprehensive analysis evaluated all key factors impacting airport operations, including:
▪ the 1983 Tripartite Agreement
▪ noise guidelines
▪ hours of operation at the BBTCA and the impact of early morning and late evening flights on the neighbouring community
▪ terminal, runway and passenger ferry infrastructure limitations
▪ the availability of parking and transportation options to and from Eireann Quay
▪ mix and types of commercial, private and leisure aircraft
▪ helicopter and MEDEVAC flights
“The Billy Bishop Toronto City Airport is an attractive facility for passengers and carriers alike,” said Mark McQueen, Chairman of the TPA Board of Directors, “But it has both a modest physical footprint and is governed by the Tripartite Agreement, which serves to cap the number of daily commercial flights that can operate from the BBTCA. Based upon the informal requests we’ve received from commercial carriers, demand for new slots far exceeds the supply available. This ‘slot controlled’ situation is no different than other North American airports, such as Pearson, Vancouver, Newark Liberty, JFK, LaGuardia, or Washington Reagan. All major airlines recognize that an airport can only award the slots that exist, even if that won’t satisfy every carrier request – a circumstance that exists at most slot-controlled airports.”
The third-party study considered current BBTCA usage by leisure aircrafts and helicopters, in addition to the approximate 2,500 life-saving MEDEVAC service operations per annum. The study also considered that existing BBTCA commercial carrier operations will utilize approximately 120 slots in the period leading up to April 2010, some of which are designated as “Night Operations.” Night Operations are defined as services operating between 6:45 – 7 a.m. and 10 – 11 pm. Under the existing Tripartite Agreement, the BBTCA is closed to all non-emergency flights between 11 p.m. and 6:45 a.m.
“Now that we have the results in hand, the Toronto Airport Authority will initiate the next phase of the process,” said Geoff Wilson, President and CEO of the TPA. “We will solicit formal business proposals for additional BBTCA airline service, while ensuring that the process continues to remain open and transparent.”
The next phase of the process will also see the TPA appoint an independent, IATA-accredited slot co-ordinator to manage commercial carrier demand at the BBTCA and allocate available slots. The co-ordinator will act as a neutral party during commercial carrier negotiations and be responsible for awarding slots based on internationally recognized processes.
Based on the initial results of the study, the TPA anticipates that once phase two of the new BBTCA terminal is fully completed in the second half of 2010, between 42 and 92 additional commercial slots will be available for award by the IATA-accredited slot coordinator for utilization by incumbent and new commercial carriers under a number of variables and scenarios. Further refinement to usage patterns by existing BBTCA stakeholders is currently underway to determine the precise number of slots that could be awarded among the incumbent and prospective new carriers. The TPA expects updated data to be available in January 2010.
“Our objective is to increase and diversify the number of destinations services by the airport,” added Wilson. “There are many attractive short haul destinations that are still not served by the BBTCA and we are anxious to continue improving choice and convenience for all travellers.”
The TPA will announce a process to receive and consider proposals from prospective commercial carriers early in the new year. All proposals will be expected to outline: i) proposed flight destinations; ii) service frequency; iii) proposed equipment; iv) what arrangements will specifically be made to handle a proponent’s passengers at the BBTCA, and v) a commercial carrier’s long term commitment to BBTCA passengers.
As is customary at many airports, all commercial carriers providing service from the BBTCA will be required to enter into a commercial carrier operating agreement (“CCOA”) with the TPA before they can commence flight operations. Commercial carriers must also secure appropriate terminal space from the City Centre Terminal Corp. – BBTCA’s terminal operator – which has the exclusive right and contractual obligation to provide all commercial carriers with access to its new facility once the construction project is completed in 2010. To date, the TPA understands that no commercial carriers have responded to the November 9, 2009 public call by City Centre Terminal Corp. soliciting proposals to utilize the new BBTCA terminal.
“I encourage all prospective commercial carriers with a desire to fly into the BBTCA in 2010 to take advantage of the opportunity to utilize the new terminal,” said Wilson. “It is unclear how any commercial carrier would expect to be granted slots through this process without a clear plan as to how they intend to manage passenger traffic, security screening and border clearance.”
With the rapid increase in monthly traffic and the number of new carriers seeking access to the airport, the BBTCA capacity study also identified the need for the TPA to make further capital expenditures. In January 2009, the TPA Board moved to acquire a new, larger ferry to accommodate the anticipated passenger growth that ultimately came to pass in 2009.
“Despite the difficult recession, Porter’s continued passenger growth, combined with new carrier proposals, means that our task of modernizing the BBTCA is not yet complete,” continued Mr. McQueen. “Over the near term we will be looking at what immediate steps we need to take to ensure that passengers continue to enjoy the success that has become the BBTCA.”
[4] A copy of this bulletin was sent to an official of Air Canada by an official of TPA on December 24, 2009, under cover of a letter which stated, in part:
Thank you for your letter dated December 23, 2009 and Mr. Rovinescu’s letter to Mr. Paul dated December 18, 2009.
Please refer to the attached Bulletin which was released today and describes the progress on our assessment of airport capacity as well as outlines the concepts for the process which will be used to assess and allocate commercial scheduled service capacity.
It would be premature at this time to comment on the information provided by you, as we are preparing a formal process to receive and consider proposals from prospective commercial carriers early in the new year.
With respect to terminal arrangements, you will need to contact City Centre Terminal Corp.
[5] Air Canada, following receipt of this letter and bulletin, filed the first of its two applications for judicial review, T-488-10. The basis for the application was set out in the Notice of Application as follows:
This is an application for judicial review of the December 24, 2009 decision (the “Decision”) of the Toronto Port Authority (the “TPA”) announcing a process (the “Proposed Process”) through which it intends to award slots at the Billy Bishop Toronto City Airport (the “Island Airport”) commencing in 2010. In the Decision, the TPA announced that pursuant to the Proposed Process:
(a) it will appoint an independent, IATA-accredited, slot coordinator to manage commercial carrier demand and allocate slots at the Island Airport; and
(b) commercial carriers will be required to make terminal arrangements exclusively with City Centre Terminal Corp. (“CCTC”), a corporation related to or controlled by one or more of the same individuals who are shareholders, directors or officers of Porter Airlines Inc. (“Porter”), for terminal space at the Island Airport.
The relief requested was for:
(a) an Order setting aside the Decision and the Proposed Process for the allocation of existing and newly available additional slots as the Island Airport;
(b) an Order that the TPA act within its jurisdiction pursuant to the Canada Marine Act, S.C. 1998, c. 10 and in accordance with the common law in its allocation of slots in (a) above;
(c) an Order enjoining the TPA from taking any steps to implement the Proposed Process;
(d) costs of this application; and
(e) such further and other relief as to this Honourable Court seems just.
The balance of the Notice of Application sets out recitals of fact and law of the type commonly found in a Statement of Claim.
2) T-692-10
[6] This is the second of Air Canada’s two applications. It deals with what Air Canada characterizes as a decision made by the Toronto Port Authority dated April 9, 2010. On that day, TPA released a bulletin entitled:
Toronto Port Authority issues formal Request for Proposals for additional carriers at Billy Bishop Toronto City Airport
That bulletin read in part:
Appoints world’s largest independent airport coordination organization to review formal business proposals and oversee slot allocation for additional airline service
Toronto – The Toronto Port Authority (“TPA”) today announced that a formal Request for Proposals (“RFP”) for additional commercial airline carriers at the Billy Bishop Toronto City Airport (“BBTCA”) has been issued and is now available to interested, qualified proponents.
“As the BBTCA evolves into a world-class city centre airport, it has been our stated objective to diversify the number of destinations offered in an effort to meet the demands of our business and leisure travellers,” said Geoff Wilson, President and CEO of the TPA. “The issuance of the formal RFP is the next major phase of the transparent process that we outlined in December. We’re excited about the opportunities and additional airline services that this RFP will generate for the people of Toronto, which follows the parameters stipulated by the Tripartite Agreement.”
Request for proposals for additional carriers
To date, the TPA has received informal expressions of interest from Air Canada (which the carrier has publicly disclosed) and one U.S.-based commercial carrier. The TPA invites all qualified industry parties interested in providing carrier services at the BBTCA to participate in the RFP process.
“As the RFP contains commercially-sensitive information, and given that related court proceedings recently initiated against the TPA by Air Canada are ongoing, any party interested in receiving the RFP must first enter into a standard commercial non-disclosure agreement,” added Mr. Wilson. “We are committed to respecting the confidentiality of all parties involved, and as such, the TPA will enter into the same form of non-disclosure agreement with each interested party to protect proprietary information contained in each new proposal.”
Comprehensive slot allocation process
To review the formal business proposals received through the RFP process, the TPA also announced the appointment of Airport Coordination Limited (“ACL”), an independent consultancy firm specializing in demand and capacity assessment and scheduling process management, to manage commercial carrier demand and allocate available slots for the BBTCA.
. . .
As part of its responsibilities as an independent slot coordinator for the BBTCA, ACL will implement a slot allocation methodology that is similar to those used at other North American airports such as Pearson, Vancouver, Newark Liberty, JFK, LaGuardia and Reagan.
Capacity assessment factors
The TPA also confirmed that it has received the final results from the capacity assessment report for the BBTCA conducted by a third-party consultant, Jacobs Consultancy, an US$11 billion organization that is one of the world’s largest providers of technical services. The study considered that existing BBTCA commercial carrier operations will utilize approximately 112 slots in the period leading up to the pending allocation of additional slots. After an extensive analysis that evaluated the key factors affecting airport operations, Jacobs Consultancy recommended that the maximum number of commercial slots available at the BBTCA is 202 upon the completion of the new terminal.
According to the Jacobs Consultancy analysis, which is based upon the 1983 Tripartite Agreement and obligations contained in existing agreements with incumbents, approximately 90 additional movements per day will be made available for allocation by ACL among the existing commercial carrier and new carriers at the BBTCA upon the successful completion of the new process. The recent acquisition of the Marylin Bell I, as well as the completion of the new terminal facilities, makes possible the increase in the number of slots available for allocation. Importantly, the 202 slot count is predicated upon the 1983 Tripartite Agreement and the necessary NEF Contour analysis, as it governs facility usage and ambient noise. Under the Tripartite Agreement, commercial and recreational flights are not permitted at the BBTCA between 11 p.m. and 6:45 a.m.
The current and earlier NEF Contour analyses heavily weigh Night Operations movements, which meaningfully and artificially lowered slot counts in prior years. Under the NEF Contour formula, a single operation between 10 p.m. and 11 p.m. (defined as a Night Operation) equates to approximately 16 Daytime Operation slots.
“We had a choice to make as an organization: provide for 90 additional Daytime movements and zero Night movements, or 10 Daytime movements and five Night movements,” added Mark McQueen, Chairman of the TPA Board of Directors. As the two new airlines proponents have requested more than 100 slots between them, we had no choice but to maximize the number of slots available. We recognize that this approach did not produce the number of slots sought, but we are governed by the airport’s limited footprint and the Tripartite Agreement. The decision to prohibit additional commercial Night Operations will uphold our curfew policy and minimize any impact on the Waterfront community.”
Carbon offset efforts
To further mitigate the impact of the BBTCA’s operations on the environment and its neighbouring communities, the TPA will be acquiring carbon offsets in the near term.
. . .
[7] A copy of this bulletin was sent to an official of Air Canada by an official of TPA on April 9, 2010, under cover of a letter which stated:
Further to our letter dated December 24, 2009, and your letter of inquiry dated January 13, 2010 we are attaching a Bulletin which has been released today and announces the Request for Proposals (“RFP”) process to consider additional carriers at the BBTCA.
As the RPF contains commercially sensitive information, interested parties will need to first enter into a standard commercial non-disclosure agreement (“NDA”). As the TPA is committed to respecting your business confidentiality, we will also enter into the same form of NDA.
As you have expressed interest in providing service at the BBTCA, we are enclosing with this letter the Carrier NDA for your perusal and execution. Once we have received your executed NDA, we will forward the RFP and the TPA’s executed NDA.
We look forward to your participation in this process.
[8] On May 4, 2010, Air Canada filed its second application for judicial review, T-692-10, the basis for which is set out in its Notice of Application as follows:
1. This is an application for judicial review in respect of the April 9, 2010 decision (the “April Decision”) of the Toronto Port Authority (the “TPA”) announcing a Request for Proposals (the “RFP Process”) to allocate slots and otherwise grant access to commercial carriers seeking access to the Billy Bishop Toronto City Airport (the “Island Airport”).
2. The April Decision purports to implement the TPA’s decision regarding a process (the “Proposed Process”) for allocation of slots and access to the Billy Bishop Toronto City Airport (the “Island Airport”) announced on December 24, 2009 (the “December Decision”).
3. The Proposed Process is described in the Applicant’s Notice of Application for judicial review of the December Decision in the proceeding bearing Court File T-488-10 (the “December Application”).
4. The April Decision of the TPA:
(a) takes steps to have the TPA enter into a contractual relations to award flight slots and otherwise grant access to the Island Airport to commercial carriers participating in the RFP Process;
(b) enables commercial carriers to enter into non-disclosure agreements for the purpose of concluding a commercial carrier operating agreement (“CCOA”) with the TPA;
(c) appoints Airport Coordination Limited (“ACL”) as an “independent slot coordinator” to manage commercial carrier demand and allocate slots at the Island Airport;
(d) permits ACL to implement a slot allocation similar to that used at “other North American airports such as Pearson, Vancouver, Newark Liberty, JFK, LaGuardia and Reagan”;
(e) permits the TPA to receive expressions of interest, including from a U.S.-based commercial carrier, and invites parties to participate in the RFP process.
[9] The relief claimed by Air Canada in this second Notice of Application requested:
(a) an Order setting aside the April Decision and the RFP Process for the allocation of existing and newly available additional slots at the Island Airport;
(b) an Order setting aside any contractual arrangements that have been made pursuant to or arising from the April Decision or the RFP Process including, inter alia, such arrangements that allocate slots or otherwise grant access to the Island Airport;
(c) an Order that the TPA act within its jurisdiction pursuant to the Canada Marine Act, S.C. 1998, c. 10 and in accordance with the common law in its allocation of slots at the Island Airport;
(d) an Order enjoining the TPA from taking any further steps to implement the April Decision or the RFP Process;
(e) costs of this application; and
(f) such further and other relief as to this Honourable Court seems just.
[10] Unlike the first Notice of Application which set out a Statement of Claim-like narrative, this second Notice set out the grounds for the application briefly as follows:
THE GROUNDS FOR THE APPLICATION ARE:
5. As part of the December Application, counsel for the TPA made certain representations to the Court on March 23-24, 2010 and at a case management conference on April 12, 2010 concerning the implementation of the Proposed Process while the December Application was pending. As a result, Air Canada seeks to ensure that the implementation of that Proposed judicial review.
6. Air Canada, in the December Application, sets out the grounds for its application to set aside and enjoin the implementation of the December Decision.
7. The April Decision in effect implements the Proposed Process outlined in the December Decision.
8. Air Canada repeats and relies on the same grounds set out in the December Application in this notice of application challenging the April Decision.
[11] Although the Respondent Toronto Port Authority was the “decision-maker” in the matters raised in both applications, Porter also was named as a party Respondent and participated fully in these proceedings.
3) At the Hearing
[12] In oral argument at the hearing of these applications, Counsel for Air Canada, Mr. Finkelstein re-stated the relief claimed by his client as being:
1. A declaration that the process followed by the Toronto Port Authority was fatally flawed;
2. That the April 2010 Commercial Carrier Operating Agreement (2010 CCOA) between the Toronto Port Authority, Porter and Porter Aviation Holdings Inc. be set aside;
3. That the process for allocation of slots at Billy Bishop Toronto City Airport be commenced again in a “proper” fashion including consultations with Air Canada.
II. The Parties, BBTCA, Slots and IATA
[13] The Applicant, Air Canada, is Canada’s largest domestic and international airline. It has corporate affiliation of one kind or another with Jazz Air and earlier, Air Ontario which are and were smaller regional airlines operating in Canada and to some extent internationally. Air Canada presently serves the greater Toronto area from facilities located at Pearson International Airport. The Respondent Porter Airlines Inc. does not have facilities at Pearson.
[14] The Respondent Toronto Port Authority (TPA) describes itself this way in bulletins that it has published, such as the bulletin of April 9, 2010:
The Toronto Port Authority was incorporated on June 8, 1999 as a government business enterprise under the Canada Marine Act as the successor to the Toronto Harbour Commissioners. It is a federal public authority providing transportation, distribution, storage and container services to businesses. The TPA owns and operates the Billy Bishop Toronto City Airport, Marine Terminals 51 and 52, and the Outer Harbour Marina. The TPA also provides regulatory controls and public works services to enhance the safety and efficiency of marine navigation and aviation in the port and harbour of Toronto.
[15] The Respondent Porter Airlines Inc. (Porter) is a commercial airline based at Billy Bishop Toronto City Airport (BBTCA). It came into existence through predecessors including those described as Regional Holdings (Regco) beginning in about 2002. Porter has a number of affiliated entities including Porter Aviation Holdings Inc., City Centre Terminal Corp. and others all dealing in one way or another with operations of that airline and at that airport. The Respondent Porter began commercial airline operations in about 2006 with two aircraft and limited regional routes, and now has several more aircraft operating routes to many places in Ontario, Quebec, the Maritimes and the United States.
[16] Not a party, but central to these proceedings, is the airport located at the west end of Toronto Island proximate the downtown core of the City of Toronto. Access is provided by a ferry operating in what is known as the Western Gap. The airport has operated under a number of names including Toronto Island Airport, Toronto City Centre Airport and Billy Bishop Toronto City Airport (BBTCA). The land is owned by the City of Toronto and leased to the Respondent Toronto Port Authority. Over the years, this airport has served various functions, including providing facilities for medical emergency aircraft and for “general aviation” (GA), which is a term indicating small private and charter aircraft. Commercial passenger airline activities have from time to time been carried out using this airport by City Express (now defunct), Air Ontario, Jazz Air and, more recently, Porter.
[17] Another term that must be discussed at the beginning is “slot”. Sometimes the word “movement” is used instead. In commercial aviation terms a “slot” is used to designate the provision for the taking off or landing of an aircraft - each is a “slot”. In the context of these proceedings, there are “quiet time” slots which are those occurring between 6:45 a.m. and 7:00 a.m. and 10:00 p.m. and 11:00 p.m. Also used is the term “peak time” slots which indicates those slots assigned at times when passenger traffic is greatest, such as business travel in the early morning and late afternoon.
[18] IATA is the acronym for the International Air Transport Association, founded in 1945. It is an association comprised of airlines which represent over ninety (90%) percent of the world’s scheduled international air traffic. Air Canada is a member, Porter is not. No airport is a member; however, several airports can achieve a status with IATA called “airport advisor”. BBTCA is not an airport advisor. IATA publishes guidelines which are not mandatory but may be adopted for use by airports for, among other things, slot management. Some airports, such as Pearson, have adopted these guidelines. Other airports follow them to some degree. Among these guidelines are those respecting slot management, wherein airports are designated as Level l, Level 2 or Level 3. Level 1 essentially means that slots are managed on a co-operative basis; Level 3 means that demand for slots exceeds supply, and a slot co-ordinator has been appointed to manage slots and impose the determinations made on the users. Moving up the levels usually involves some consultation between the users, and on occasion those hoping to be users, of the airport.
III. The Evidence
[19] All of the parties filed evidence in these proceedings. Since the proceedings were taken by way of applications, no live witnesses appeared before the Court. No party raised any serious issue as to the credibility of any witness, nor does the Court make any finding in that regard. All witnesses are considered to be credible. Each party submitted expert evidence. Porter took objection to some of Air Canada’s evidence, which I will note below.
[20] Orders were issued in each of these applications to the effect that some of the evidence filed would be sealed and remain confidential unless and until a further Order of the Court was made in that respect. The hearings were held in open Court.
[21] In particular, filed in evidence was:
A) For the Applicant Air Canada
1. Affidavits of Leslie Allan Lupo, sworn February 3, 2010 and May 14, 2010 together with exhibits as identified therein (Applicant’s Record, pp. 79-564). He was cross-examined on June 9, 2010, and certain exhibits identified at that time (Applicant’s Record, pp. 2757-2793). Lupo is Senior Legal Counsel at the International Air Transport Association (IATA). It is unclear whether he is giving evidence only as to the practices followed by IATA or going beyond that to speak to expertise on “international standards.” To the extent that his evidence goes beyond that of IATA I will give it little weight as his expertise beyond IATA was not established.
2. Affidavits of Gustavo Baumberger sworn February 5, 2010 and May 18, 2010 together with exhibits as identified (Applicant’s Record, pp. 565-822). He was cross-examined on June 15, 2010, and an exhibit identified at that time (Applicant’s Record, pp. 2906-2961). Baumberger is Senior Vice-President of Compass Lexicon, a consulting firm that specializes in the application of economics to legal and regulatory issues. No objection was taken as to his expertise.
3. Affidavits of Marcel Forget sworn February 8, 2010, May 19, 2010 and June 7, 2010 together with exhibits as identified (Applicant’s Record, pp. 823-1235). He was cross-examined on June 14, 2010, and an exhibit was identified at that time (Applicant’s Record, pp. 2794-2905). A written response to an undertaking was subsequently provided (Applicant’s Record, pp. 2962-2969). Forget is Vice President of Network Planning of Air Canada. He was presented as a fact witness. Porter’s Counsel raised concerns that some of Forget’s evidence did not come from first-hand knowledge or was essentially argument of Counsel. I will give this part of his evidence little weight.
4. Affidavit of Alain Boudreau sworn February 8, 2010 together with exhibits as identified (Applicant’s Record, pp. 1236-1389). He was cross-examined on June 7, 2010, and exhibits were identified at that time (Applicant’s Record, pp. 2521-2682). A written response to an undertaking was produced (Applicant’s Record, pp. 2962-2969). Boudreau is Senior Director Air Canada Jetz and Specialty Products for Air Canada. He was presented as a fact witness. Porter’s Counsel raises an objection that some of Boudreau’s evidence does not arise from first-hand knowledge. I will give this part of his evidence little weight.
5. Affidavits of Elize LeGraw, sworn March 26, 2010 and April 30, 2010 together with exhibits as identified (Applicant’s Record, pp. 1390-1394 and 2486-2520). There was no cross-examination. LeGraw is a law clerk in the office of the Applicant’s solicitors. Her affidavits serve to provide certain documents.
6. Affidavit of Janet Jones sworn May 19, 2010 together with exhibits as identified (Applicant’s Record, pp. 1395-2312). There was no cross-examination. Jones is a law clerk in the office of the Applicant’s solicitors. Her affidavit serves to provide certain documents.
B) For the Respondent TPA
1. Certain documents provided in response to the Applicant’s request under Rule 318 (Applicant’s Record, pp. 2314-2485).
2. Affidavit of Alan J. Paul sworn April 26, 2010 together with exhibits as identified (TPA’s Record, pp. 1-1423). He was cross-examined on June 8, 2010, and an exhibit identified at that time (Applicant’s Record, pp. 2970-3135). A written answer to undertakings was provided (Applicant’s Record, pp. 3233-3325). Paul is Vice-President and Chief Financial Officer of the Toronto Port Authority (TPA). He was presented as a fact witness.
3. Affidavit of Dr. Michael Tretheway sworn April 29, 2010 together with exhibits as identified (TPA’s Record, pp. 1424-1648). He was cross-examined on May 28, 2010, and an exhibit identified at that time (Applicant’s Record, pp. 3326-3369). Tretheway is Executive Vice-President and Chief Economical of InterVISTAS Consulting Inc. with expertise in transportation economics. His evidence was presented as that of an expert. No challenge was made as to his expertise.
4. Affidavits of Geoffrey Wilson sworn April 30, 2010 and May 27, 2010 together with exhibits as identified (TPA’s Record, pp. 1649-2013). Wilson was cross-examined on June 11, 2010 and a written answer provided as to certain undertakings (Applicant’s Record, pp. 3136-3325). Wilson is the President and Chief Executive Officer of the Toronto Port Authority (TPA). He is the successor to the witness Paul. He was presented as a fact witness.
C) For the Respondent Porter
1. Affidavits of Michael Deluce sworn April 29, 2010 and May 26, 2010, together with exhibits as identified (Porter’s Record, pp. 1-1313). He was cross-examined on June 4, 2010, and an exhibit identified, subject to objection, at that time (Applicant’s Record, pp. 3370-3468). A written answer to undertakings was provided (Porter’s Record, p. 1359). Deluce is the Executive Vice-President and Chief Commercial Officer of the Respondent Porter Airlines Inc. (Porter) and several of its affiliate companies. He was presented as a fact witness.
2. Affidavits of Roger Ware sworn April 29, 2010 and June 2, 2010, together with exhibits, as identified (Porter’s Record, pp. 1315-1356). He was cross-examined on June 4, 2010, and an exhibit identified at that time (Applicant’s Record, pp. 3370-3502). Ware is a PhD Professor of Economics at Queen’s University; his expertise focuses on Industrial Organization, including antitrust economics and competition policy and strategic behaviour. He was retained to critique certain of the expert evidence submitted by the Applicant. His evidence was submitted as expert evidence. No objection was taken as to his expertise.
IV. The Issues
[22] Air Canada states the issues in its Factum simply as:
1. Are the Decisions subject to judicial review?
2. Are the Decisions invalid?
[23] Toronto Port Authority set out the matters that it submitted were at issue more fully in its Factum:
(a) whether Air Canada may rely upon the grounds of denial of procedural fairness and “formal and substantive unreasonableness”, and breaches of statutes, none of which were enunciated in the Notices of Applications for Judicial Review;
(b) whether Air Canada can properly pursue these judicial review applications, given that it is not “directly affected”, the Court’s discretion in respect of such matters, and its past history of re-litigating the same or similar claims;
(c) whether the TPA, in respect of its actions complained of in these applications, is a federal board, commission or other tribunal, subject to judicial review;
(d) whether, if the TPA’s actions complained of are subject to judicial review, it was under a duty to consult Air Canada;
(e) whether the Bulletin of December 24, 2009, and the announcement therein with respect to the future process of slot allocation, is an order or matter capable of being judicially reviewed;
(f) whether Air Canada is out of time to judicially review the decision to allocate “grandfathered” slots to Porter;
(g) whether the TPA’s actions complained of may be reviewed on the basis off “formal and substantive unreasonableness”; and
(h) whether the decisions at issue were made for an irrelevant or improper purpose.
[24] Porter put the issues more simply in its Factum:
(a) Can Air Canada properly pursue these judicial review applications?
(b) Has the TPA breached any duty of fairness it may have owed?
(c) Are the impugned “decisions” of the TPA reasonable?
(d) Has the TPA acted with an improper purpose?
[25] Some issues were not pursued, others restated or merged, and new issues arose during the course of oral argument. As matters have evolved, at the end of the hearing, the following issues emerged as those that I must address:
1. In respect of the “decisions” at issue, was the Toronto Port Authority acting as a “federal board, commission or other tribunal” so as to be subject to judicial review of those decisions in this Court?
2. Is Air Canada a “person interested” who has standing to seek judicial review of those “decisions” in this Court?
3. Were the “decisions” of December 24, 2009 and April 9, 2010 of a kind that can be the subject of judicial review in this Court?
4. Has Air Canada properly pleaded some of the grounds that it now urges in seeking judicial review?
5. Was there an obligation upon the Toronto Port Authority to consult with Air Canada before making the “decisions” of December 24, 2009 and April 9, 2010?
6. Were the “decisions” both “formally” and “substantively” reasonable?
7. Did the TPA have any obligation to provide “reasons” for its decisions, and if reasons were provided were they adequate?
8. Were the “decisions” made for an improper purpose?
V. Chronology of Events
[26] The history of events involving the Toronto Island Airport, the City of Toronto, the parties to the proceedings, their predecessors and affiliates and others is lengthy and complex. It would be impractical to set out every event in detail. I will enumerate some of them in more or less chronological order:
1. The Toronto Island Airport (which I will sometimes refer to as BBTCA) was built in the early 1930s on land located on the west end of Toronto Island. This land was, and continues throughout to be, owned by the City of Toronto. Ferry service accessing BBTCA from the mainland commenced in 1964.
2. On June 30, 1983, an agreement was entered into between the City of Toronto, the Toronto Harbour Commissioners (predecessors of the Respondent Toronto Port Authority) and the Minister of Transport respecting the Toronto Island Airport. That agreement is usually referred to as the Tripartite Agreement. That agreement granted to the Toronto Harbour Commissioners ( predecessor of the Toronto Port Authority) a 50-year lease for the Island Airport and related facilities subject to a number of terms and conditions such as the payment of rent. Among other things, the lessee (Toronto Harbour Commissioners) was obliged to regulate the overall frequency of aircraft movement so as to respect certain noise restrictions. If the lessee defaulted and the default was not cured in a timely way, the Minister of Transport was entitled to step in and run the airport, failing which the airport would revert to the City of Toronto.
3. In the 1980s, commercial airline service from BBTCA was established and operating as a thriving service by an entity known as City Express. That entity was not affiliated with or related to any of the parties to these proceedings. Service was established linking BBTCA, Ottawa, Montreal, Newark and elsewhere.
4. In 1991 City Express ceased its operations.
5. In about 1990, Air Ontario, an Air Canada subsidiary, had commenced operations from BBTCA. That entity and another Air Canada affiliate, Jazz continued operations at BBTCA until 2006 when all operations by those entities ceased. Initially, these operations were thriving, serving various destinations from BBTCA; however, over the years the number of locations served, the frequency of flights and care and attention paid to the facilities diminished considerably.
6. On June 11, 1998, Royal Assent was given to the Canada Marine Act, S.C. 1998, c. 10. That Act repealed earlier legislation respecting navigation and shipping including the Toronto Harbour Commissioners’ Act 1985, 33-34-35 Eliz II, c. 10. The Canada Marine Act, S.C. 1986, c. 10, made provision for Letters Patent to be issued to establish a port authority (section 8) which Letters were not to be considered to be regulations but would be published in the Canada Gazette (sub-section 8(3)).
7. On June 8, 1999, Letters Patent became effective establishing the Toronto Port Authority and setting out certain activities to be carried out by that authority. Those Letters were published in the Canada Gazette, Part 1, June 5, 1999. Section 7.2(j) authorized the TPA to operate the BBTCA in accordance with the Tripartite Agreement. As of June 1999, Air Canada’s affiliate airlines were the only commercial airlines operating out of that airport.
8. The BBTCA was operating at a loss while the Air Canada affiliates were operating there. By 2002, those operations had diminished considerably. The TPA had continuing discussions with Jazz requesting that it commit to operations at the airport. In the meantime, the TPA also commenced discussions with Porter’s predecessors as to Porter establishing airline services from BBTCA and revitalizing services and facilities there.
9. On July 18, 2002, the Competition Bureau wrote a letter to the TPA with a copy to Transport Canada respecting proposals made by RAH (a Porter predecessor) to the TPA as to commencing a new regional airline service from BBTCA (then referred to as TCCA). That letter stated that the Bureau understood that RAH intended to ramp up operations significantly over a four-year period and was, among other things, seeking an exclusive right to 143 of the 167 slots available. That letter stated, in part:
In relation to the RAH proposal, I would like to make three points.
First, Lester B. Pearson International Airport (“Pearson”) and TCCA a