Court references have been used throughout the federation’s history to settle jurisdictional disputes. The carbon tax battle is the latest chapter.

The political battle over the federal carbon pricing regime has migrated to the courts. The Saskatchewan Court of Appeal’s recent advisory opinion is the first but surely not the last word on how the Constitution enables us to deal with environmental concerns. On a larger scale, the fight between numerous provinces and the federal government puts in stark relief long-standing tensions over the constitutional division of powers.

The focus of the federal-provincial tug-of-war this time is the 2018 Greenhouse Gas Pollution Pricing Act. The GGPPA mandates a national fuel charge and enacts performance standards for large industrial facilities. Designed as a “backstop,” the carbon price applies only in provinces that do not have sufficient GHG-reduction measures of their own.

From the start, Saskatchewan objected that the law is pure federal overreach. To press its concerns, Saskatchewan initiated a “reference,” asking the province’s court of appeal whether the GGPPA falls within federal authority. In early May, the court advised, in a 3-to-2 opinion, that it is. Ontario initiated similar proceedings in the Ontario Court of Appeal; that matter was heard in April and a decision is pending. Other provinces, such as Alberta, Manitoba and New Brunswick, appear ready to launch similar proceedings in their own courts.

The issue in question is urgent. The Saskatchewan court called climate change “one of the great existential issues of our time.” At the hearing, none of the parties or intervenors questioned its gravity. The question is how to address the threat as a country.

The Constitution divides law-making authority between the provinces and Canada. While some subjects such as fisheries incidentally involve environmental management, there is no reference to “the environment” as such in the Constitution. The authority to make such laws therefore does not belong exclusively to either order of government.

The federal Parliament does enjoy a number of powers, including over criminal law and taxation, that could be wielded against climate change. But the government largely has not relied on them here (it does offer an alternative reading of the fuel charge as a valid federal tax). It instead takes the more difficult path of defending the GGPPA under the Constitution’s “peace, order and good government” power (POGG).

The POGG power has three branches: emergencies, new matters and national concern. The federal government argues that GHG emissions are a matter of national concern requiring a legislative framework that only it can provide. For many people, however, the “national concern” branch is troublesome. Unlike emergencies, which are by definition temporary, and new matters, which are rare, “national concern” has the potential to decimate provincial powers. As well, a subject that attains national concern is within Parliament’s exclusive jurisdiction, such that no province may legislate to that same end. The federal government has not often persuaded the courts that a matter should be recognized as a national concern. The last time the Supreme Court endorsed such an argument (relating to atomic energy) was in 1993. In 1997, the federal government failed to establish that regulating toxic pollution was a such a matter (though the law being considered was upheld on a different basis).

Recognizing a “national concern” over carbon emissions, the provinces say, would lead to federal control over every aspect of daily life. They have pushed this point to some effect. In the Ontario hearing, federal lawyers were asked whether Ottawa could use its new-found power to regulate fireplaces or driving. In the recent Saskatchewan opinion, the court noted that “the boundaries of possible regulation…are limited only by the imagination.” The debate is reminiscent of the fight in the US over the Affordable Care Act (commonly referred to as Obamacare). The late Supreme Court justice Antonin Scalia asked whether, if the federal government could force people to buy health insurance, it could also force them to buy broccoli. The absurdity was meant to demonstrate the threat posed by a federal government with too much power.

The opinion of the Saskatchewan court reflects some of that traditional caution. The three-judge majority rejected the federal argument that GHG emissions per se are a matter of national concern. But they said that the risks posed by GHG emissions are “issues of superordinate consequence,” that GHG emissions “do not respect provincial boundaries” and that a failure of one province to appropriately regulate affects all the others. The majority therefore accepted that the establishment of “minimum national standards of price stringency for GHG emissions” is an area of national concern. (It also stated that the law is a valid federal tax.)

Assuming that the carbon price remains in effect (the federal Conservatives have indicated that, if elected, they would repeal it), the matter will probably end up at the Supreme Court of Canada. Certainly, that is the goal of the provinces opposed to the GGPPA. One can expect a hearing featuring most if not all of the provinces as well as the numerous intervenor groups. The case law and proceedings to date suggest that the federal argument will prevail, but it is not without its challenges.

In predicting next steps, it is noteworthy that the provinces have not used conventional constitutional litigation to get the matter before the court. That is, they have not launched direct challenges against the law. Instead, they have put the matter to the court as references. Dating back to 1875, the reference function permits a court to answer questions without a live dispute, or case, before it. While the resulting opinion is considered to be merely “advisory,” in practice it is followed like any other judicial decision.

Open to both federal and provincial governments, references provide some procedural advantages. The government that moves the reference can frame the questions exactly as it likes. There is a much speedier progression through the courts. The federal government can refer questions directly to the Supreme Court. Provinces cannot, but they have an automatic right to appeal from their courts of appeal to the Supreme Court of Canada.

References enable like-minded provinces to strengthen their hand and coordinate their efforts. First, multiple proceedings may increase the odds of the provinces finding judicial support (the Saskatchewan opinion included a dissent). Second, by staggering references, provinces can respond to issues as they arise in various courts. For example, because Saskatchewan focused its questions on the law’s “validity,” the court declined to consider the separate issue of whether the fuel charge applied to provincial Crown corporations. Another province, though, could raise that issue in a separate reference.

Multiple references allow all of the parties, as well as any intervenors, to test and sharpen their arguments. Since references do not involve a live dispute, a court may consider itself to have more latitude to accept different arguments. In the Saskatchewan reference, the majority largely adopted a narrower approach to POGG offered by the Attorney General of British Columbia.

There are undoubtedly political effects to the reference process. Multiple proceedings may help to displace tension by allowing the issue to percolate in various jurisdictions for a longer period. Equally, though, references may increase the political pressure on a party such as the federal government, which will appear perpetually on the defensive. For that reason, among others, a federal government sometimes “leapfrogs” the lower court process by initiating a reference to the Supreme Court and ensuring that it stays in control.

At the same time, there is something valuable in permitting lower courts to weigh in on a matter before the Supreme Court considers it. While the Supreme Court is not bound to follow the lower courts, it may be assisted by judicial analyses filtered through those regional perspectives. That can create a richer body of jurisprudence.

The carbon tax struggle is a study in the evolution of the Constitution’s division of powers, mediated through the long-standing tradition of advisory opinions. It shows that the Constitution provides a variety of tools for navigating the challenging relationships among the many actors in our federation.

Photo: Premier Scott Moe looks on after Saskatchewan’s Court of Appeal ruled in a split decision that a federally imposed carbon tax is constitutional during a press conference at the Legislative Building in Regina on May 3, 2019. THE CANADIAN PRESS/Michael Bell


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