Judicial review is a public law remedy – but does this preclude its availability for decisions made by private entities (eg, voluntary associations and political parties)? Divergent lines of judicial authority have led to inconsistent answers to this question in Ontario. However, the Ontario Divisional Court's decision in The Conservative Party of Canada v Trost (2018 ONSC 2733) has confirmed that the answer to this question is yes. Importantly, the divisional court held that the Ontario Court of Appeal's decision in Setia v Appleby College (2013 ONCA 753) was not intended to expand the availability of judicial review beyond the traditional scope of supervision of government activity.
Mr Trost was a candidate in the leadership contest for the Conservative Party of Canada. The party's executive director alleged that Trost's campaign had leaked the party's membership list. After an inquiry, Trost was fined C$50,000 for the leak. He applied for judicial review of that decision on the basis that the party had failed to follow its own rules, and alleged that the decision gave rise to a reasonable apprehension of bias.
The party moved to quash Trost's application on the basis that it was not amenable to judicial review because the decision to fine Trost was not an exercise of statutory authority. A single judge of the court referred this question to a hearing before a full panel of the divisional court for resolution, which was necessary because two lines of conflicting jurisprudence had arisen in the courts of Ontario and other jurisdictions as to the availability of judicial review for decisions of private entities. Some authorities held that judicial review was limited to decisions or activities based in statutory exercises or grants of power. The conflicting line of authorities held that in circumstances where the matter was of sufficient public importance – and in light of a variety of contextual factors – decisions of private entities that were not the product of exercises of statutory authority could be judicially reviewed.
In Ontario, judicial review is made available pursuant to the Judicial Review Procedure Act, which does not specify when judicial review remedies are available to applicants. The prerogative writs have historically been available only for government decisions. However, some recent applications for judicial review of private entities' decisions have been allowed to proceed on the basis of Setia. In Setia the Ontario Court of Appeal applied a series of contextual factors (initially set out by Justice Stratas in Air Canada v Toronto Port Authority (2011 FCA 347)) to conclude that a decision of a private school regulated by the Education Act was governed by private and not public law.
Justice Swinton, for the full panel of the divisional court, allowed the party's motion to quash Trost's application on the basis that the party's decision was not amenable to judicial review. The court applied seven of the Setia factors to find that the party's disciplinary decision was "not a decision to which a public law remedy can be applied" (Paragraph 14).
The first Setia factor – the character of the matter for which review is sought – supported the inapplicability of judicial review because the matter is a contractual dispute arising from the terms of participation in the party leadership race. The dispute was limited to the application of that contract. The court found that this was not a matter of public importance.
The second factor – the nature of the decision maker and its responsibilities – was relevant because political parties are not government actors, notwithstanding that they play important roles in parliamentary governance in Canada. The fact that political parties participate in governance was not sufficient to make their internal affairs subject to judicial review, as they are engaged in essentially private activities and are subject to review by the courts pursuant to private law remedies.
The third factor – the extent to which the challenged decision is founded in law – pointed to judicial review being unavailable because the matter arose out of a private contract between the parties.
The fourth factor – the body's relationship to other statutory schemes or other parts of government – related to the second factor in that the party is a private actor that is governed by its own constitution, and does not therefore stand in a relationship to other statutory schemes or parts of government.
The fifth factor – the extent to which the decision maker is an agent of government, controlled or significantly influenced by a public entity – points to the same conclusion, as political parties are independent of the government.
Nor did the existence of compulsory power support the availability of judicial review because the power being exercised was a result of a contract, rather than a conferral of state power on a disciplinary body.
The final factor considered by the court – the "exceptional category" of cases where the conduct has attained a serious public dimension – was the primary source of conflict between the two lines of jurisprudence governing this matter. The court canvassed the jurisprudence which focused on this factor and held that previous decisions in which the actions of private entities were made subject to judicial review on the basis that they had sufficient public import were wrongly decided. The 'exceptional category of cases' factor does not give courts free rein to conduct judicial reviews of decisions of private entities with broad public impact. Instead, this factor – among others – was to be used to distinguish between those decisions of government entities that were subject to private law remedies (eg, the termination of employment contracts) as opposed to public law remedies. In other words, the decision at issue still requires a government nexus. The court stated at Paragraph 33:
"The factors set out in Setia are used to determine whether public law remedies or private law remedies are available in respect of a particular exercise of power of a governmental decision maker or a decision maker who derives power from government. Those factors were not meant to be used to subject the decisions of private actors to judicial review."
The divisional court quashed the application and awarded costs to the party.
This decision confirms the traditional boundaries of judicial review and the unavailability of public law remedies to review decisions made by private entities that do not derive their authority from statute. The divisional court did not elaborate in detail on the policy reasons for this limitation. Shortly after the decision in Trost was released, the Supreme Court of Canada released its reasons in Judicial Committee of the Highwood Congregation of the Jehovah's Witnesses v Wall (2018 SCC 26), which addressed the same issue. In that case, the respondent applied for judicial review of the internal conduct of an unincorporated religious association. While the Alberta Court of Appeal held that judicial review was available in circumstances where breaches of natural justice or significant proprietary interests were involved, the Supreme Court of Canada overturned this decision and held that judicial review is available only to review exercises of state authority with a sufficiently public character. This is the same conclusion as was reached in Trost.
Trost and Wall have now resolved a significant issue in the scope of judicial review.
This article first appeared in IAM. For further information please visit www.IAM-media.com.
