When Vavilov makes judicial review more difficult: findings of fact in a statutory appeal

Introduction

The Supreme Court of Canada’s December 2019 decision in Canada (Minister of Citizenship and Immigration) v Vavilov was a game-changer in Canadian administrative law. Decades of case law was synthesized – or overturned, depending on one’s point of view – as a new framework was promulgated for substantive review of administrative decisions. Despite detractors, Vavilov appears to have been quite well received, providing clarity in what was an unwieldy area of law. Much of the praise appears to be premised on the notion that judicial review is less illusory. This is certainly the case more frequently, as there is now greater necessity for administrators to justify their reasons and correctness review now applies more broadly. One of those areas where correctness review now applies is when an administrative decision is subject to a statutory appeal on a question of law. What has been absent from most commentaries on Vavilov is the impact on findings of fact subject to statutory appeals: such findings are now to be reviewed on a standard of palpable and overriding error. It is this specific area – where the availability of judicial review seems to have been constrained by Vavilov – that we explore in this article.

Part I of this article introduces the Vavilov framework for standard of review, and particularly how it addresses statutory appeals. Part II discusses the palpable and overriding error standard that now applies to findings of fact made by administrators whose decisions are subject to a statutory appeal. Part III discusses the practical implications of this. They are not tremendously broad – rarely are administrative actors (in Ontario, in any event) subject to having their findings of fact statutorily appealed. But where they do, they will now be more difficult to review. We concentrate on the professional discipline context, where this is particularly prevalent and likely to be germane given the importance of credibility in this context. In the conclusion, we take no position on the desirability of this development. But we do believe that those practicing and otherwise affected by administrative law should realize that judicial review has likely been constrained in this discrete but important area. It will make the litigation before certain administrative tribunals all the more important in years ahead.

VAVILOV AND STATUTORY APPEALS

Vavilov was hotly anticipated in the legal profession. The Supreme Court announced in May 2018 that it was considering overturning the Dunsmuir framework, and invited parties to devote a substantial amount of their factums to that issue. Twenty-seven interveners were also granted leave to make legal submissions. The Supreme Court comprehensively considered first principles and history of judicial review in Canada in the context of reformulating a framework for judicial review going forward.

The majority of the court held that previously prescribed contextual analyses for determining the standard of review are to be dispensed with. Rather, there is to be a presumption that administrative decisions are to be reviewed for reasonableness. This presumption is not based in the administrator’s expertise – though that expertise may be a reason for the legislature to establish the administrator, it is not a legal reason for deference and, in any event, does not always exist. Rather, the rationale for deference lies in the mere fact that the legislature has empowered the administrator to make the decision in the first place. However, the majority held that correctness review would nonetheless be required in two instances. The first is when the legislature has prescribed a standard other than reasonableness to apply. This would be done if stated explicitly or in the presence of a statutory appeal, which we will discuss later in this article. In the majority’s view, the granting of a statutory right of appeal suggests that the legislature intended traditional standards of appellate review to apply. The second overarching category where correctness review is to be continued is when the rule of law requires it. This would be the case if there is a dispute between multiple administrators over jurisdiction, for constitutional questions concerning the division of powers and enabling statute (with questions concerning the application of the Canadian Charter of Rights and Freedoms being left for another day), and questions of central importance to the legal system. Concerning this last category, the majority departed from the additional requirement in Dunsmuir that the question of central importance to the legal system also be outside the administrator’s expertise. However, the court declined to find that disagreement within an administrative body would, without more, lead to correctness review. It also closed the category of “true” questions of jurisdiction, which had previously attracted correctness review.

The majority also gave extensive guidance on how the reasonableness standard is to be applied, emphasizing that reasons would frequently be necessary. And though the reasons may not look like judicial reasons, nor are review judges to “search” for errors, review is nonetheless to be robust against the reasons actually given – not those that could theoretically have been given. This has already led to judicial reviews being successful on the Vavilov framework in circumstances where it is doubtful that that would have been the case prior to Vavilov.

Paul Daly has aptly described the concurring opinion of Abella and Karakatsanis JJ as “disguised dissenting” reasons. The thrust of the concurrence is that the majority showed insufficient respect for the expertise of administrators, departed from decades of case law moving towards greater deference, and potentially created much more litigation through expanding the availability of judicial review. The concurrence took particular umbrage with the majority prescribing correctness as a standard of review when a statutory appeal exists on a question of law. In the concurrence’s view, there may be a whole host of reasons why a statutory appeal would exist without the legislature desiring correctness review. In any event, departing from this required departing from decades of precedent. Nigel Bankes has already defended the concurrence’s view in this regard.

This article takes no position on whether the majority was correct to mandate correctness review on questions of law in the presence of a statutory appeal.¹ Rather, we argue that in the rush to suggest that judicial review will be more widely available in a post-Vavilov world – a conclusion we do not dispute in the aggregate – insufficient attention has been paid to the effects of Vavilov on statutory appeals based on findings of fact.

THE PALPABLE AND OVERRIDING ERROR STANDARD

Vavilov makes it clear that statutory appeals in the administrative law context are to be treated the same way as appeals from courts. This generally means that trial judges’ determinations on questions of law are to be reviewed for correctness. However, findings of fact are to be overturned only in the presence of “palpable and overriding error”. Questions of mixed fact and law will only be reviewed if the determination of law can be easily extracted. In the criminal context, the Crown is prohibited from appealing a factual finding.

These dividing roles – in which the principle of appellate restraint is emphasized – are based on concerns surrounding efficiency and expertise. Trial judges are better positioned than appellate judges to make findings of fact given that they traditionally see evidence in person. This may not be the case when evidence is based on affidavit but, even there, an appellate court is no better situated than a trial court to make determinations on that affidavit, and efficiency cautions against appellate intervention. The principle of finality also advises against interfering with a trial judge’s decision unnecessarily. Moreover, trial and appellate courts have different purposes, as stated by Iacobucci and Major JJ in Housen v Nikolaisen: “the primary role of trial courts is to resolve individual disputes based on the facts before them and settled law, [while] the primary role of appellate courts is to delineate and refine legal rules and ensure their universal application”.

What is the palpable and overriding error standard? It is certainly a high one. A “palpable error” is traditionally described as one that is “plainly seen”, “clear to the mind or plain to see”, and “so obvious that it can easily be seen or known”. Findings of credibility, however, are quintessentially ill-suited to be overturned on a palpable error standard. Indeed, it is somewhat difficult to imagine how a finding of credibility would be so erroneous as to be “plainly seen”. But not only must an error be palpable to be overturned on appeal, it also must be overriding – i.e., it must have impacted the result.

In essence, this makes findings of fact extremely difficult to review. This has been subject to criticism. By way of example, John Adair and Paul Pape have expressed concern that this allows first-instance decision-makers to insulate their reasons from appellate review by masquerading (presumably disingenuously) controversial findings as “findings of fact” and leaving them unable to be reviewed. They have called for reasonableness review in this area. In response to controversial, high-profile acquittals, there have also been suggestions that the Crown should be able to appeal on questions of fact in the criminal law context.

These deferential standards are still defensible, however. For instance, Daniel Jutras has posited that appeals are neither good in themselves nor logical corollaries to decision making; rather, they have discrete purposes. If those purposes are expanded, there may be unnecessary litigation and parties will be lacking finality. Even Antonin Scalia– a major opponent of judges twisting the law to comport with their preferred policy outcomes – expressed more sympathy with trial judges reframing facts to align with a just outcome. With these rationales in mind, we now consider what the consequences may be of holding that palpable and overriding error is to be the standard on which to review administrators’ findings of fact.

FINDINGS OF FACT AND PROFESSIONAL DISCIPLINE

Many Ontario statutes limit statutory appeals to questions of law, a clear legislative design choice to leave a decision-maker’s factual findings undisturbed. However, statutes regulating professionals allow statutory appeals for any question, or at least questions of mixed fact and law. These include the: Regulated Health Professions Act, 1991; Architects Act; Ontario College of Teachers Act, 1996; Police Services Act; Law Society Act; and the Surveyors Act. Appeals in these domains typically involve professionals challenging findings of professional misconduct and accompanying sanctions. Panels frequently must consider a factual matrix where credibility assessments are central to the outcome.

Stefanov v College of Massage Therapists of Ontario is one such case, described in the decision itself as a “classic credibility case.” Stefan Stefanov, a registered massage therapist, appealed the finding of the Discipline Committee Panel of the College of Massage Therapists of Ontario that he engaged in professional misconduct and sexually abused a client (the complainant) at a spa in downtown Toronto, and the order that his certificate of registration be suspended for twelve months. The panel found that the complainant’s allegations of sexual assault were credible and Mr. Stefanov’s denial was not. On appeal, the Divisional Court reviewed the panel’s decision on a Dunsmuir standard and concluded that the panel’s reasons leading to its finding were incomplete, unintelligible, and lacked transparency. In particular, (a) the panel gave sparse consideration to the complainant’s inability to recall details and no consideration to the inconsistencies in her evidence; (b) the panel failed to consider the relevance of rejecting two of the complainant’s allegations (that Mr. Stefanov exposed the complainant’s bikini and vulva areas and that he looked under the sheet at her genitalia); and (c) the panel unreasonably considered Mr. Stefanov’s evidence, in, for example, finding that because his testimony was extremely detailed it was questionable.

Interestingly, the Divisional Court’s decision was seen by many as a significant departure from settled principles on the role of a reviewing court in examining credibility findings. The court’s scrutiny of the evidence and its rejection of the panel’s credibility findings were criticized as unwarranted in reasonableness review. One wonders how the palpable and overriding error standard may have influenced the Divisional Court’s comfort in overturning the panel’s factual findings.

Disciplinary proceedings brought by law societies against lawyers are also firmly rooted in fact-finding with common issues including allegations of mortgage fraud or misappropriation of client funds. Prior to Vavilov, and under the contextual inquiry dictated by Dunsmuir, decisions by the hearing and appeal panels of the Law Society of Ontario attracted reasonableness review for findings of mixed fact and law, fact, determination of penalty, and interpretations of its home statute. Case law had also determined that where a decision depends on credibility assessments, an appellate court is to consider the reasonableness of the outcome while attentive to the advantage the tribunal has over the appellate court in assessing credibility and “the difficulties inherent in articulating reasons for credibility findings”. Even prior to Vavilov, the Ontario Court of Appeal cautioned the Law Society Appeal Panel and the Divisional Court from interfering with decisions based on assessments of credibility. The more stringent appellate standard of palpable and overriding error further constrains the ability of a reviewing court to overturn factual findings.

We have already seen one instance of this, in the Divisional Court’s decision in Houghton v Association of Ontario Land Surveyors. The case concerned an appeal from the Discipline Committee of the Association of Ontario Land Surveyors, which, among other things, revoked Mr. Houghton’s licence to practice as a land surveyor after factually finding that he had committed misconduct. Mr. Houghton submitted that a less deferential standard than “palpable and overriding error” should apply to the decision given its consequences on him and to give effect to Vavilov’s call for “robust” reasonableness review. For a unanimous panel, Myers J rejected this submission, holding that the decision should be treated like any other appeal.

Ultimately, this early case law, coupled with first principles analysis, suggests that reviewing courts will be more constrained in reviewing certain types of questions in a post-Vavilov world. This is not necessarily negative, reflecting the different roles of first instance and appellate decision-makers. But it does emphasize the importance of factual findings, particularly in the professional discipline context.

CONCLUSION

Vavilov may have transformed Canadian administrative law in making judicial review more available. But when it comes to findings of fact in statutory appeals, it appears likely that they will now be more difficult to overturn. This underscores the importance of administrative decision-makers whose decisions are subject to statutory rights of appeal, particularly in the professional discipline context, properly making findings of fact. Counsel in this context should be aware of the importance of administrative decision-makers’ findings of fact. While cases that will fall into this situation are not common – given the rarity of appeals of findings of fact in the administrative context – they can nonetheless be tremendously important, especially when individuals’ livelihoods are at stake. The perception that Vavilov has made judicial review easier is not the case here.

Citations for this article are available on request from the authors. Please contact cbaadminlaw@cba.org.

Gerard J. Kennedy is Assistant Professor, Faculty of Law, University of Manitoba and Alyssa Clutterbuck is Litigation Associate, Osler, Hoskin & Harcourt LLP.