ATTORNEY GENERAL of BRITISH COLUMBIA Appellant And

SCC File No: 38682

IN THE SUPREME COURT OF CANADA (ON APPEAL FROM THE COURT OF APPEAL FOR BRITISH COLUMBIA)

BETWEEN: ATTORNEY GENERAL OF BRITISH COLUMBIA Appellant and

ATTORNEY GENERAL OF CANADA Respondent and

ATTORNEY GENERAL OF ONTARIO, PROCUREURE GÉNÉRALE DU QUÉBEC, ATTORNEY GENERAL OF ALBERTA and ATTORNEY GENERAL OF SASKATCHEWAN

Interveners (By Right) and

CITY OF VANCOUVER, CITY OF BURNABY, ECOJUSTICE CANADA, COUNCIL OF THE HAIDA NATION, HEILSTSUK FIRST NATION, ASSEMBLY OF FIRST NATIONS, LITTLE SHUSWAP LAKE INDIAN BAND, TRANS MOUNTAIN PIPELINE ULC, BEECHER BAY FIRST NATION, SONGHEESNATION AND T’SOU-KE NATION, LAX KW’ALAAMS BAND, CANADIAN ASSOCIATION OF PETROLEUM PRODUCERS, CANADIAN FUELS ASSOCIATION, CANADIAN ENERGY PIPELINE ASSOCIATION, COALITION OF INTERESTED PARTIES, RAILWAY ASSOCIATION OF CANADA, CONSORTIUM OF ENERGY PRODUCERS (SUNCOR ET AL), IN THE MATTER OF THE CONSTITUTIONAL QUESTION ACT, R.S.B.C. 1996, C. 68, ECOJUSTICE CANADA SOCIETY, HEILTSUK TRIBAL COUNCIL, EXPLORERS AND PRODUCERS ASSOCIATION OF CANADA, SUNCOR ENERGY INC., IMPERIAL OIL LIMITED, HUSKY OIL OPERATIONS LIMITED, CENOVUS ENERGY INC. AND CANADIAN NATURAL RESOURCES LIMITED Interveners (By Leave)

FACTUM OF THE ATTORNEY GENERAL FOR SASKATCHEWAN: INTERVENER (Rules of the Supreme Court of Canada, Rules 37 & 42)

ATTORNEY GENERAL FOR GOWLING WLG (CANADA) LLP SASKATCHEWAN Barristers and Solicitors Constitutional Law Branch 160 Elgin Street, Suite 2600 820 – 1874 Scarth Street OTTAWA ON K1P 1C3 - ii -

REGINA SK S4P 4B3

Thomson Irvine D. Lynne Watt Noah Wernikowski Tel: (613) 786-8695 Tel: (306) 787-6307 Fax: (613) 788-3509 Fax: (306) 787-9111 E-mail:[email protected] E-mail: [email protected]

Counsel for the Intervener, Ottawa Agent for the Intervener, Attorney General for Saskatchewan Attorney General for Saskatchewan

and

ARVAY FINLAY LLP MICHAEL J. SOBKIN 1512 – 808 Nelson Street 331 Somerset Street West VANCOUVER BC V6Z 2H2 OTTAWA ON K2P 0J8

Joseph J. Arvay, Q.C. Catherine Boies Parker Tel: (604) 696-9828 Fax: 1-888-575-3281 E-mail:[email protected] [email protected]

Ministry of the Attorney General (British Columbia) 6th Floor, 1001 Douglas Street VICTORIA BC V8W 9J7

J. Gareth Morley Tel: (250) 952-7644 Fax: (250) 356-0064 E-mail:[email protected]

Counsel for the Appellant, Attorney General Agent for the Appellant, Attorney of British Columbia General of British Columbia

and

ATTORNEY GENERAL OF CANADA ATTORNEY GENERAL OF CANADA Department of Justice Department of Justice British Columbia Regional Office National Litigation Sector 840 Howe Street, Suite 900 56 O’Connor Street, 5th Floor VANCOUVER BC V6Z 2S9 OTTAWA ON K1A 0H8

Jan Brongers Christopher Rupar BJ Wray Tel: (613) 670-6290 - iii -

Tel: (604) 666-0110/(604) 666-4304 Fax: (613) 954-1920 Fax: (604) 666-1585 E-mail:[email protected] E-mail:[email protected]/ [email protected] Counsel for the Respondent, Agent for the Respondent, Attorney General of Canada Attorney General of Canada

and

Gail Legge Grant Zwack LLP Gowling WLG (Canada) LLP 1000 1199 West Hastings Street 160 Elgin Street, Suite 2600 VANCOUVER BC V6Z 2H2 OTTAWA ON K1P 1C3

Peter A. Gall, Q.C. D. Lynne Watt Andrea L. Zwack Tel: (613) 786-8695 Tel: (604) 891-1152 Fax: (613) 788-3509 Fax: (604) 669-5101 E-mail:[email protected] E-mail:[email protected]/ [email protected]

Counsel for the Intervener, Agent for the Intervener, Attorney General of Alberta Attorney General of Alberta

and

Ministry of the Attorney General (Ontario) Juristes Power Law 720 Bay Street, 4th Floor 130 Albert Street, Suite 1103 TORONTO ON M7A 2S9 OTTAWA ON K1P 5G4

Josh Hunter Maxine Vincelette Padraic Ryan Tel: (613) 702-5573 Tel: (416) 326-0131 Fax: (613) 702-5573 Fax: (416) 326-4015 E-mail:[email protected] E-mail:[email protected] [email protected]

Counsel for the Intervener, Attorney Agent for the Intervener, Attorney General of Ontario General of Ontario

and

Ministère de la justice du Québec Noël & Associés 1200, route del’Église, 4ͤ étage 111, rue Champlain QUEBEC CITY QC G1V 4M1 GATINEAU QC J8X 3R1

Frédéric Perrault Pierre Landry Tel: (418) 643-1477, ext. 20785 Tel: (819) 503-2178 Fax: (418) 644-7030 Fax: (819) 771-5397 - iv -

E-mail:[email protected] E-mail:[email protected]

Counsel for the Intervener, Procureure Agent for the Intervener, Procureure Générale du Québec Générale du Québec

and

City of Vancouver Gowling WLG (Canada) LLP 453 West 12th Avenue 160 Elgin Street, Suite 2600 VANCOUVER BC V5Y 1V4 OTTAWA ON K1P 1C3

Susan B. Horne Jeffrey W. Beedell Kevin T. Nakanishi Tel: (613) 786-0171 Tel: (604) 873-7512 Fax: (613) 788-3587 Fax: (604) 873-7445 E-mail:[email protected] E-mail:[email protected]

Counsel for the City of Vancouver Agent for the City of Vancouver

and

Ratcliff & Company Supreme Advocacy LLP 221 West Esplanade, Suite 500 100 – 340 Gilmour Street NORTH VANCOUVER BC V7M 3J3 OTTAWA ON K2P 0R3

Gregory J. McDade, Q.C. Marie-France Major Michelle L. Bradley Tel: (613) 695-8855, Ext: 102 Tel: (604) 988-5201 Fax: (613) 695-8580 Fax: (604) 988-1452 E-mail:[email protected] E-mail:[email protected]

Counsel for the City of Burnaby Agent for the City of Burnaby

and

White Raven Law Corporation Gowling WLG (Canada) LLP 16541 Upper Beach Road 2600 – 160 Elgin Street SURREY BC V3S 9R6 Box 466 Station D OTTAWA ON K1P 1C3

Terri-Lynn Williams-Davidson Brian A. Crane, Q.C. Elizabeth Bulbrook Tel: (613) 233-1781 Tel: (604) 536-5541 Fax: (613) 563-9869 Fax: (604) 536-5542 E-mail:[email protected] E-mail:[email protected]

Counsel for Council of The Haida Nation Agent for Council of The Haida Nation - v -

and

Assembly of First Nations Counsel Supreme Law Group 55 Metcalfe Street, Suite 1600 900 – 275 Slater Street OTTAWA ON K1P 6L5 OTTAWA ON K1P 5H9

Stuart Wuttke Moira Dillon Julie McGregor Tel: (613) 691-1224 Tel: (613) 241-6789 Ext : 228 Fax: (613) 691-1338 Fax: (613) 241-5808 E-mail:[email protected] E-mail:[email protected]

Counsel for Assembly of First Nations Agent for Assembly of First Nations

and

Grant Novacs Norell Gowling WLG (Canada) LLP 400 – 900 Howe Street 2600 – 160 Elgin Street VANCOUVER BC V6Z 2M4 Box 466 Station D OTTAWA ON K1P 1C3

Arthur M. Grant Brian A. Crane, Q.C. Tel: (604) 642-6361 Tel: (613) 233-1781 Fax: (604) 609-6688 Fax: (613) 563-9869 E-mail:[email protected] E-mail:[email protected]

Counsel for Little Shuswap Lake Agent for Little Shuswap Lake Indian Band Indian Band

and

Osler, Hoskin & Harcourt LLP Osler, Hoskin & Harcourt LLP Suite 2500, Trans Canada Tower Suite 1900 450 1st Street S.W. 340 Albert Street CALGARY AB T2P 5H1 OTTAWA ON K1R 7Y6

Maureen E. Killoran, Q.C. Geoffrey Langen Olivia Dixon Tel: (613) 787-1009 Tel: (403) 260-7003 Fax: (613) 235-2867 Fax: (403) 260-7024 E-mail:[email protected] E-mail:[email protected]

Counsel for Trans Mountain Pipeline ULC Agent for Trans Mountain Pipeline ULC

and - vi -

JFK Law Corporation Gowling WLG (Canada) LLP 816-1175 Douglas Street 2600 – 160 Elgin Street VICTORIA BC V8W 2E1 OTTAWA ON K1P 1C3

Robert Janes, Q.C. Guy Régimbald Ara Laskin Tel: (613) 786-0197 Tel: (250) 405-3460 Fax: (613) 563-9869 Fax: (250) 381-8567 E-mail:[email protected] E-mail:[email protected] Counsel for Beecher Bay First Nation, Agent for Beecher Bay First Nation, Songhees Nation and T’Sou-Ke Nation Soughees Nation and T’Sou-Ke Nation

and

Lawson Lundell LLP Gowling WLG (Canada) LLP 205 – 5th Avenue S.W. 2600 – 160 Elgin Street Suite 3700 Box 466 Station D CALGARY AB T2P 2V7 OTTAWA ON K1P 1C3

Brad Armstrong, Q.C. Matthew Estabrooks Lewis L. Manning Tel: (613) 786-0211 Tel: (403) 269-6900 Fax: (613): 788-3573 Fax: (403) 269-9494 E-mail: [email protected] E-mail:[email protected]

Counsel for Canadian Association of Agent for Canadian Association of Petroleum Producers Petroleum Producers

and

Fasken Martineau DuMoulin LLP Fasken Martineau DuMoulin LLP 2900 – 550 Burrard Street 55 rue Metcalfe VANCOUVER BC V6C 0A3 Bureau 1300 OTTAWA ON K1P 6L5

D. Geoffrey G. Cowper, Q.C. Sophie Arseneault Stanley Martin Tel: (613) 236-3882 Daniel Byma Fax: (613) 230-6423 Tom Posyniak E-mail:[email protected] Tel: (604) 631-3131 Fax: (604) 632-3232 E-mail:[email protected]

Counsel for Canadian Fuels Association Agent for Canadian Fuels Association

and - vii -

Borden Ladner Gervais LLP Borden Ladner Gervais LLP Centennial Place 1300 – 100 Queen Street 1900 – 520 3rd Ave SW OTTAWA ON K1P 1J9 CALGARY AB T2P 0R3

Michael A. Marion Karen Perron Alan Ross Tel: (613) 369-4795 Brett R. Carlson Fax: (613) 230-8842 Tel: (403) 232-9500 E-mail:[email protected] Fax: (403) 266-1395 E-mail:[email protected]

Counsel for Canadian Energy Agent for Canadian Energy Pipeline Association Pipeline Association

and

Osler, Hoskin & Harcourt LLP Osler, Hoskin & Harcourt LLP Suite 2500, Trans Canada Tower Suite 1900 450 1st Street S.W. 340 Albert Street CALGARY AB T2P 5H1 OTTAWA ON K1R 7Y6

Maureen E. Killoran, Q.C. Geoffrey Langen Sean Sutherland Tel: (613) 787-1009 Tel: (403) 260-7003 Fax: (613) 235-2867 Fax: (403) 260-7024 E-mail:[email protected] E-mail:[email protected]

Counsel for Enbridge Inc. Agent for Enbridge Inc.

and

McCarthy Tétrault LLP Gowling WLG (Canada) LLP Suite 2400 0 745 Thurlow Street 2600 – 160 Elgin Street VANCOUVER BC V6E 0C5 Box 466 Station A OTTAWA ON K1P 1C3

Nicholas Hughes Matthew Estabrooks Emily MacKinnon Tel: (613) 786-0211 Tel: (604) 643-5983 Fax: (613): 788-3573 Fax: (604) 622-5606 E-mail: [email protected] E-mail:[email protected]

Counsel for Railway Association of Canada Agent for Railway Association of Canada - viii -

and

Ecojustice Canada Society Champ and Associates 390 – 425 Carrall Street 43 Florence Street VANCOUVER BC v6b 6e3 OTTAWA ON K2P 0W6

Harry Wruck, Q.C. Bijon Roy Tel: (604) 685-5618 Tel: (613) 237-4740 Fax: (604) 685-7813 Fax: (613) 232-2680 E-mail:[email protected] E-mail:[email protected]

Counsel for Ecojustice Canada Society Agent for Ecojustice Canada Society

and

NG Ariss Fong Supreme Advocacy LLP Suite 800 – 555 West Georgia Street 100 – 340 Gilmour Street VANCOUVER BC V6B 1Z5 OTTAWA ON K2P 0R3

Lisa C. Fong Marie-France Major Tel: (604) 331-1155 Tel: (613) 695-8855 Ext : 102 Fax: (604) 677-5410 Fax: (613) 695-8580 E-mail:[email protected] E-mail:[email protected]

Counsel for Heiltsuk Tribal Council Agent for Heiltsuk Tribal Council

and

Blake, Cassels & Graydon LLP Gowling WLG (Canada) LLP 199 Bay Street 2600 – 160 Elgin Street Suite 4000, Commerce Court West Box 466 Station A TORONTO ON M5L 1A9 OTTAWA ON K1P 1C3

Catherine Beagan Flood D. Lynne Watt Peter W. Hogg Tel: (613) 786-8695 Laura Cundari Fax: (613) 788-3509 Christopher DiMatteo E-mail:[email protected] Tel: (416) 863-2269 Fax: (416) 863-2653 E-mail: [email protected]

Counsel for Suncor Energy Inc., et al. Agent for Suncor Energy Inc. et al. - x -

INDEX

Page

I OVERVIEW 1

II POSITION ON APPELLANT’S QUESTIONS 1

III STATEMENT OF ARGUMENT 2

A. The Purpose of Federal Jurisdiction 2

B. Constitutional Principles and Environmental Jurisdiction 5

C. Question 1: Is the Proposed Legislation Ultra Vires? 8

(1) The Decision of the British Columbia Court of Appeal 8

(2) Scope of Federal Power 10

(3) Application to this Case 13

D. Question 2: Inter-Jurisdictional Immunity 14

E. Question 3: Paramountcy 17

IV COSTS 20

VII TABLE OF AUTHORITIES 21 - 1 -

PART I: OVERVIEW 1. British Columbia’s Proposed Bill would regulate the operation of an inter-provincial pipeline and therefore would be ultra vires. The federal government has exclusive jurisdiction over the environmental issues relating to the management and operation of inter-provincial pipelines and the product being shipped on those pipelines, as part of the national regulatory framework over all aspects of an inter-provincial undertaking.

2. Federal regulation of inter-provincial works and undertakings is essential for land-locked provinces to get their products to market. The accidents of geography do not give coastal provinces the power to block the ability of interior provinces to get their goods to international markets.

3. Saskatchewan is particularly affected by this issue. Saskatchewan cannot get its products to international markets year-round via a Canadian route without going through two other provinces to the west, or three other provinces to the east. Saskatchewan depends on federal regulation of inter-provincial works and undertakings to ensure that Saskatchewan products can reach international markets.

4. Saskatchewan supports federal environmental regulation of inter-provincial works and undertakings. Saskatchewan recognises the need for federal environmental review of such projects. That too is an important part of the federal jurisdiction: to ensure environmental protection in the interests of all Canadians, with respect to projects that affect all Canadians.

5. Saskatchewan thus relies on the federal jurisdiction to take into account the interests of all Canadians in regulating inter-provincial transportation, including environmental issues. It would be contrary to that basic principle of federalism if one province could frustrate the construction or operation of an inter-provincial transportation system.

PART II: POSITION ON APPELLANT’S QUESTIONS 6. Saskatchewan takes the following positions on the three Reference questions: Question 1: Constitutional Validity of the Law Saskatchewan agrees with the British Columbia Court of Appeal: the Proposed Bill would be ultra vires the Province, as an attempt to regulate a work or undertaking under federal jurisdiction. - 2 -

Question 2: Inter-jurisdictional Immunity The Proposed Bill would impair the “essential and vital elements” of an inter-provincial pipeline, namely by regulating the type and quantity of product that can be shipped, as well as imposing operational requirements. The law therefore would not apply to a federally regulated inter-provincial pipeline, under the doctrine of inter-jurisdictional immunity.

Question 3: Paramountcy Federal law extensively regulates the construction and operation of inter-provincial pipelines, allowing product to be shipped by pipeline if all the requirements of the federal laws are met, including federal environmental protections. Applying the Proposed Bill to a federally regulated pipeline would infringe both branches of the paramountcy test, by triggering an operational conflict, and by frustrating the purpose of the federal laws.

PART III: STATEMENT OF ARGUMENT A. The Purpose of Federal Jurisdiction 7. Access to international markets was one of the reasons for Confederation. Sir Étienne- Pascal Taché, Co-Premier of the Province of Canada, made this point in the Confederation Debates in 1865. After commenting that the Province of Canada lacked year-round access to the sea due to “five months of the year in fields of ice”, he stated: Canada [i.e. Ontario and Quebec] was, in fact, just like a farmer who might stand upon an elevated spot on his property, from which he could look around upon fertile fields, meandering streams, wood and all else that was necessary to his domestic wants, but who had no outlet to the highway. To be sure he might have an easy, good-natured neighbour, who had such an outlet, and this neighbour might say to him, “Don’t be uneasy about that, for I will allow you to pass on to the highway, through my cross road, and we shall both profit by the arrangement.” So long as this obliging neighbour was in good humour everything would go on pleasantly, but the very best natured people would sometimes get out of temper, or grow capricious, or circumstances might arise to cause irritation. And so it might come to pass that the excellent neighbour would get dissatisfied. … he might come to the isolated farmer and say to him, … “I am determined you will find some other outlet to the highway than my cross road, for henceforth my gate will be shut against you.” In such a case what is the farmer to do?1

1 Province of Canada, Parliamentary Debates on the Subject of the Confederation of the British North American Provinces, Eighth Parliament, 3rd Session (“Confederation Debates”), Sir Étienne-Pascal Taché at 6-7 (3 February 1865) [emphasis added]. See also: Confederation Debates, George-Étienne Cartier at 55-56 (7 February 1865); George Brown at 107-108 - 3 -

8. Confederation solved the problem of access to international markets by uniting the interior provinces to the coastal provinces, but that solution would only be effective if the federal government had control over transportation to the sea. There would be no trading benefit to the interior provinces if the coastal provinces could block access to tidewater.

9. The need for federal regulation of inter-provincial transportation was highlighted in the Confederation Debates. John A. Macdonald, Co-Premier, made this point clear: … any honorable member on examining the list of different subjects which are to be assigned to the General and Local Legislatures respectively, will see that all the great questions which affect the general interests of the Confederacy as a whole, are confided to the Federal Parliament, while the local interests and local laws of each section are preserved intact, and entrusted to the care of the local bodies. … It is provided that all “lines of steam or other ships, railways, canals and other works, connecting any two or more of the provinces together or extending beyond the limits of any province,” shall belong to the General Government, and be under the control of the General Legislature. In like manner “lines of steamships between the Federated Provinces and other countries, telegraph communication and the incorporation of telegraph companies, and all such works as shall, although lying within any province, be specially declared by the Acts authorizing them to be for the general advantage,” shall belong to the General Government. For instance the Welland Canal, though lying wholly within one section, and the St. Lawrence Canals in two only, may be properly considered national works, and for the general benefit of the whole Federation.2

10. The Fathers of Confederation thus assigned exclusive jurisdiction over inter-provincial transportation to the federal government. The opening words of s. 92(10) provide that the provinces have exclusive jurisdiction over “local works and undertakings.” It then provides that works and undertakings relating to communications, transportation, and shipping, and which cross provincial or national boundaries, are excepted from the category of “local works and undertakings” by sub-paragraphs 92(10)(a), (b) and (c). They are instead assigned to the exclusive jurisdiction of Parliament by s. 91(29) of the Constitution Act, 1867.

(February 8, 1865); H.L. Langevin at 365 (February 21, 1865); John Rose at 417 (February 22, 1865); Joseph Cauchon at 574 (March 2, 1865); D. Ford Jones at 816-817 (March 2, 1865). 2 Confederation Debates, John A. Macdonald at 40 (6 February 1865) (emphasis added), citing the Quebec Resolutions, para. 29(8), (9) and (10): Confederation Debates at 3 (3 February 1865). See also Consolidated Fastfrate Inc. v. Western Canada Council of Teamsters, 2009 SCC 53, [2009] 3 SCR 407, para. 33. - 4 -

11. The effect of these provisions is that the federal government is charged with regulating inter-provincial transportation, “for the general benefit of the whole Federation”. Saskatchewan submits that the federal government is required to take into account the interests of all the provinces. Land-locked provinces need access to international markets for their products, while the provinces through which the project will run will have concerns about the economical and environmental implications of the undertaking. First Nations will also have concerns which trigger the duty to consult. All of these issues come within the scope of the federal government to regulate the entire project.

12. One recurring theme in the cases regarding jurisdiction over inter-provincial transportation projects has been the need for a single regulator. For example, in 1926, the Judicial Committee upheld a provision in the federal Railway Act which authorised the expropriation of provincial Crown land without the consent of the province, noting that “…otherwise the construction of the railway would be dependent upon the consent of the Government of each Province through which it was intended to pass.”3 Later cases have repeated the theme that a single regulator is necessary.4

13. This Court also made this point in Bell Canada v. Quebec (CSST), rejecting dual regulation of inter-provincial works and undertakings: It is an argument which relies on a spirit of contradiction between systems of regulation, investigation, inspection and remedial notices which are increasingly complex, specialized and, perhaps inevitably, highly detailed. A division of jurisdiction in this area is likely to be a source of uncertainty and endless disputes in which the courts will be called on to decide whether a conflict exists between the most trivial federal and provincial regulations, such as those specifying the thickness or colour of safety boots or hard hats.

3 Attorney General for Quebec v. Nipissing Central Railway Co., [1926] AC 715, [1926] UKPC 39 (PC), at 721. 4 See for example: Regulation and Control of Aeronautics in Canada, Re, [1932] AC 54, [1931] UKPC 93 (PC) (no divided jurisdiction over aeronautics based on inter-provincial and intra- provincial flights); Regulation and Control of Radio Communication in Canada, Re, [1932] AC 304, [1932] UKPC 7 (PC) (no divided jurisdiction over radio broadcasting); Campbell-Bennett v. Comstock Midwestern Ltd., [1954] SCR 207 [“Campbell-Bennett”] (provincial builders’ lien not applicable to federal pipelines); Johannesson v. West St. Paul (Rural Municipality), [1952] 1 SCR 292 (no divided jurisdiction over aeronautics and landing strips); Quebec (Attorney General) v. Canadian Owners and Pilots Association, 2010 SCC 39, [2010] 2 SCR 536 [“COPA”] (no divided jurisdiction over location of landing strips); Rogers Communications Inc. v. Châteauguay (City), 2016 SCC 23, [2016] 1 SCR 467 [“Rogers Communications”] at para. 52 (no divided jurisdiction over the location of telecommunications towers). - 5 -

Furthermore, in the case of occupational health and safety, such a twofold jurisdiction is likely to promote the proliferation of preventive measures and controls in which the contradictions or lack of co‑ordination may well threaten the very occupational health and safety which are sought to be protected.

Federalism requires most persons and institutions to serve two masters; however, in my opinion an effort must be made to see that this dual control applies as far as possible in separate areas.5

14. Saskatchewan submits that the theme of a single federal regulator applies to the analysis in all three of the constitutional questions in this Reference.

B. Constitutional Principles and Environmental Jurisdiction 15. The two leading Supreme Court cases on the environment and the division of powers are Friends of the Oldman River Society v. Canada (Minister of Transport), and R. v. Hydro-Québec. This Court held that the environment was too large and all-encompassing a topic to be assigned exclusively to one level of government. Rather, both levels of government have jurisdiction over aspects of the environment, to the extent environmental concerns relate to the heads of power of each government.6

16. It is sometimes said that the federal and provincial governments have concurrent jurisdiction over the environment, but that is not the case. The division of powers operates on the principle of areas of exclusive federal and provincial jurisdiction, not concurrent jurisdiction. There are in fact only four areas of concurrent jurisdiction in Canadian constitutional law.7 All other heads of power are exclusive, based on the opening words of s. 91 and s. 92.

17. Jurisdiction over the environment is no different. Neither level of government has general environmental jurisdiction. Rather, each level of government can regulate environment issues

5 Bell Canada v. Quebec (Commission de la Santé et de la Sécurité du Travail), [1988] 1 SCR 749 [“Bell Canada”], at 843-844 [emphasis added]; quoted approvingly by McLachlin CJC in COPA, para. 53. 6 Friends of the Oldman River Society v. Canada (Minister of Transport), [1992] 1 SCR 3 [“Oldman River”], at 62-76; R. v. Hydro-Québec, [1997] 3 SCR 213 [“Hydro-Québec”], at 286- 289. 7 Constitution Act, 1867: immigration and agriculture (s. 95); old age pensions (s. 94A); export of natural resources from one province to another (s. 92A(2) and (3)). - 6 -

which relate to their respective heads of power. The scope of each government’s environmental jurisdiction depends on the nature of each head of power.8

18. There is no doubt that the provincial jurisdiction to regulate environmental issues is broad. For example, the provinces’ jurisdiction over Crown lands, property and civil rights, local works and undertakings, and natural resources carry with them significant powers to regulate associated environmental issues.9

19. The federal government also has jurisdiction to regulate environmental issues, to the extent the issues relate to the federal heads of power. The areas of federal environmental jurisdiction are more discrete than the provincial areas, given the nature of the heads of federal power. Key areas of federal environmental jurisdiction relate to the lands and rights of Indigenous peoples, federal property, navigable waters, marine pollution, fisheries, the criminal law, and the issue in this case, inter-provincial works and undertakings.10

20. The significant point is that the environmental jurisdiction of both governments is based on their different heads of power. Neither level of government can assert environmental jurisdiction over issues which are within the other government’s jurisdiction. There can sometimes be overlap in the operation of the federal and provincial environmental laws, but the constitutional underpinnings of those laws are crucial to the analysis.

21. The federal and provincial governments can choose to cooperate on environmental matters, where both can apply their environmental laws under the principles set out in Oldman River.11 For example, the Canadian Environmental Assessment Act, 2012, expressly allows for the federal

8 Oldman River, at 65-68; Hydro-Québec, at 286-289. 9 Constitution Act, 1867: Crown lands (s. 92(5), s. 109); property and civil rights (s. 92(13)); local works and undertakings (s. 92(10)); natural resources (s. 92A(1), (2)). 10 Constitution Act, 1867: “Indians, and lands reserved for the Indians” (s. 91(24)); federal property (s. 91(1A)); navigable waters (s. 91(10)); marine pollution (s. 91 – national concern); fisheries (s. 91(12)); criminal law (s. 91(27)); inter-provincial works and undertakings (s. 91(29) and s. 92(10)). 11 Régimbald and Newman, The Law of the Canadian Constitution, 2nd ed. (Toronto: LexisNexis, 2017), para. 14.20. - 7 -

government to rely on provincial environmental assessments in appropriate cases.12 Similarly, the NEB Act requires that an application for a pipeline must be filed with the Attorney General in each province to which the application relates,13 so each province can assess if its interests are affected.

22. Nonetheless, a cooperative and consultative approach by the federal government does not mean that the province has jurisdiction to regulate the environmental aspects of matters within federal jurisdiction. That is particularly the case here, where the head of federal power is the regulation of inter-provincial works and undertakings. As will be discussed later in this Factum, there is an extensive body of case law which establishes that to some extent, the operations of inter-provincial works and undertakings are not subject to overlapping provincial regulations, as a matter of constitutional vires, inter-jurisdictional immunity, and federal paramountcy.

23. Saskatchewan submits that under these constitutional principles, the provinces do not have the constitutional authority to regulate the internal operation of an inter-provincial pipeline, including the types and quantities of products shipped. That limitation on provincial power excludes legislation aimed at the environmental aspects of the product being shipped. By the ordinary principles of the division of powers relating to inter-provincial works and undertakings, the proposed British Columbia legislation would be inapplicable and inoperative with respect to an inter-provincial pipeline.

24. At the same time, Saskatchewan reiterates that federally regulated works and undertakings are not completely immune from general provincial laws, such as laws relating to environmental damage caused by an inter-provincial undertaking. That point was established in Canadian Pacific Railway v. Notre Dame de Bonsecours.14 The federally regulated railway was held liable under provincial law to clean one of its ditches which had become clogged, resulting in flooding on adjacent land. However, in Construction Montcalm this Court explained the limitation of this principle: the provincial jurisdiction does not extend to regulating the structure or management of

12 Canadian Environmental Assessment Act, 2012, SC 2012, c. 19, ss. 32-37. 13 National Energy Board Act, RSC 1985, c. N-7 (“NEB Act”), s. 32(2). See also: Canadian Energy Regulator Act, SC 2019, c. 28, s. 182 (not yet proclaimed). 14 Canadian Pacific Railway v. Notre Dame de Bonsecours, [1899] AC 367, [1899] UKPC 34 (PC) [”Notre Dame de Bonsecours”], at 372-373. - 8 -

the work or undertaking.15 This Court reaffirmed the validity of this principle in 1995, in R. v. Canadian Pacific Ltd.16 The Court unanimously held that the federally regulated railway was liable under Ontario environmental laws for environmental damage caused by the operation of its railway, citing Notre Dame de Bonsecours.

25. Saskatchewan thus respectfully disagrees with the approach to provincial environmental jurisdiction advanced by the Appellant. The Appellant’s analysis seems to assume a plenary provincial jurisdiction over environmental harm, while the federal jurisdiction is much more limited, tied to specific heads of federal power. Saskatchewan submits that while the provinces have a broad environmental jurisdiction, it must always be tied to specific heads of provincial power, using the ordinary principles of the division of powers.

26. Saskatchewan submits that the dividing line between federal and provincial jurisdiction is that the federal government has exclusive jurisdiction over the management and operation of the inter-provincial work or undertaking, including related environmental issues. The provinces have jurisdiction if the operation of the undertaking subsequently causes environmental damage affecting matters under provincial jurisdiction.

C. Question 1: Is the Proposed Legislation Ultra Vires? (1) The Decision of the British Columbia Court of Appeal 27. The British Columbia Court of Appeal held that the Proposed Bill would be ultra vires the province of British Columbia. Saskatchewan agrees with the Court of Appeal’s reasoning and result, and adopts it here.

28. Justice Newbury for the unanimous division began with the question “why?” Why are inter-provincial works and undertakings under the exclusive jurisdiction of the federal Parliament? She cited approvingly Macdonald’s comments from the Confederation Debates and reviewed the relevant case law from this Court. She stated that while the impact of a provincial law on the management and operation of an inter-provincial work or undertaking was clearly significant, the

15 Quebec (Minimum Wage Commission) v. Construction Montcalm, [1979] 1 SCR 754, at 773- 774. See also Bell Canada, at 833. 16 R. v. Canadian Pacific Ltd., [1995] 2 SCR 1028. - 9 -

important factor for the analysis of federal jurisdiction is to focus on the elements of the undertaking that made the projected specifically federal, the characteristics which made it “intrinsic to a field of federal jurisdiction”, “specifically of federal jurisdiction”, “under some primary federal aspect”.17

29. Newbury JA concluded that the Proposed Bill would significantly affect the management and operation of the Trans Mountain expansion pipeline.18 She also held that the proposed Bill would “stop in its tracks” the entire operation of the Trans Mountain expansion as an inter-provincial carrier and exporter of oil: “It is legislation that in pith and substance relates to, and relates only to, what makes the pipeline ‘specifically of federal jurisdiction.’ ”19 She also rejected the province’s argument that a “patchwork” of provincial regulation of inter-provincial pipelines would be acceptable: Notwithstanding Mr. Arvay’s contention that there is ‘nothing wrong with a patchwork’, it is simply not practical — or appropriate in terms of constitutional law — for different laws and regulations to apply to an interprovincial pipeline (or railway or communications infrastructure) every time it crosses a border. … Jurisdiction over interprovincial undertakings was allocated exclusively to Parliament by the Constitution Act to deal with just this type of situation, allowing a single regulator to consider interests and concerns beyond those of the individual province(s).20

30. Saskatchewan fully adopts this analysis, and wishes to add a comment on the analysis proposed by the Appellant, focussing on “property and civil rights” under s. 92(13) of the Constitution Act, 1867. The Appellant argues that s. 92(13) is a parallel basis for provincial environmental jurisdiction over inter-provincial pipelines. Saskatchewan respectfully disagrees, to the extent that argument would give the province jurisdiction to regulate the type and quantity of products shipped on inter-provincial pipelines, and to impose operational preventive requirements on the pipeline proponent. Saskatchewan does agree that s. 92(13) can be used to impose liability on the operator of an inter-provincial pipeline in the event of a spill.

17 Reference re Environmental Management Act (BC) (“Judgment below”), para. 100 (Appellant’s Record, Part I, at 1. 18 Judgment below, para. 99. 19 Judgement below, para. 101. 20 Judgment below, para. 101. - 10 -

31. By the combined operation of the exceptions in s. s. 92(10) and the wording of s. 91(29), the aspects of inter-provincial works and undertakings which are specifically federal are removed from the “Classes of Subjects” assigned to provincial jurisdiction. The closing words of s. 91 then make it clear that “any Matter coming within any of the Classes of Subjects enumerated in this Section” do not come within the matters assigned to the provincial jurisdiction. Thus, the aspects of inter-provincial works and undertakings which are specifically federal are removed from the classes set out in s. 92 as a whole. Just as the specifically federal aspects are removed from s. 92(10), so too are they removed from s. 92(13).

32. This precise point was the basis for the Beetz J.’s famous disagreement with Professor Hogg in Bell Canada. Professor Hogg had criticised the Court’s approach to inter-jurisdictional immunity, arguing that the double aspect principle applied: the federal government could regulate under s. 92(10) and s. 91(29), while provincial laws enacted under s. 92(13) could also apply to federal works and undertaking. Beetz J. completely rejected that argument, holding that there must be a core of regulatory power in the federal jurisdiction, and that core is then removed from provincial jurisdiction. Beetz J. also commented that this analysis does not depend on the provincial law “singling out” a federal work or undertaking. Rather, it is a general principle of the exclusive jurisdiction of Parliament over those aspects of a federal work or undertaking which are specifically federal in nature. Accepting Professor Hogg’s argument would amount to turning the federal jurisdiction into an ancillary power.21

33. Saskatchewan submits that Beetz J.’s analysis of the division of powers on this point is a complete answer to the Appellant’s argument that the Proposed Bill can be used to regulate the type and quantity of product shipped on the pipeline, and to impose operational preventive requirements. Those aspects of inter-provincial pipelines are the core area of federal jurisdiction, as identified by the Court of Appeal. Issues relating to liability in the event of environmental damage are different in kind, and do come within provincial jurisdiction.

(2) Scope of Federal Power 34. The scope of the federal jurisdiction over inter-provincial works and undertakings was first set out in 1899, in Notre Dame de Bonsecours, and in Madden v. Nelson and Fort Sheppard

21 Bell Canada, at 838-844. - 11 -

Railway Company. Both of these cases involved the application of provincial laws to railways under federal jurisdiction. In Notre Dame de Bonsecours, the Judicial Committee held that only the federal government could set regulations “… for the construction, repair, and alteration of the railway, and for its management…” Provincial jurisdiction came into play if there were external effects, such as flooding of neighbouring land caused by blockages in a ditch operated by the railway.22

35. In Madden, the Judicial Committee struck down a British Columbia law which imposed civil liability on federally regulated railways if they did not fence their railways to protect livestock. The Judicial Committee emphasised that a province cannot intrude on federal jurisdiction, even if the province thinks the federal standards are not sufficient: In other words, the provincial legislature have pointed out by their preamble that in their view the Dominion Parliament has neglected proper precautions, and that they are going to supplement the provisions which, in the view of the provincial legislature, the Dominion Parliament ought to have made; and they thereupon proceed to do that which they recite the Dominion Parliament has omitted to do. It would have been impossible, as it appears to their Lordships, to maintain the authority of the Dominion Parliament if the provincial parliament were to be permitted to enter into such a field of legislation, which is wholly withdrawn from them and is, therefore, manifestly ultra vires.23

36. Some ninety years later, this Court addressed the issue of federal jurisdiction over works and undertakings in Bell Canada, along with CN v Courtois.24 The cases dealt with the application of provincial occupational health and safety laws to federally regulated works and undertakings. The analysis in the lead case, Bell Canada, addressed both the scope of federal jurisdiction and inter-jurisdictional immunity.

37. Speaking for the unanimous Court in Bell Canada, Beetz J. held that the provincial occupational health and safety laws did not apply to federally regulated works and undertakings. Beetz J. held that the provincial laws entered “directly and massively” into the field of working

22 Notre Dame de Bonsecours, at 372-373. 23 Madden v. Nelson and Fort Sheppard Railway Co., [1899] AC 626, [1899] UKPC 47 (PC) [“Madden”], at 628 [emphasis added]. 24 Bell Canada; CN v. Courtois, [1988] 1 SCR 868. - 12 -

conditions, labour relations, and the management and operation of the federally regulated undertakings, and were therefore inapplicable.25

38. Significantly, Beetz J. rejected arguments based on the need for safety in the workplace. The province could not simply assert health and safety concerns to support its legislation, if the issue was not otherwise within provincial jurisdiction. He gave the example that a province could not “… impose an import tax on products or equipment it thought to be dangerous.”26 Any law had to be anchored in the heads of powers.

39. Beetz J. also rejected the argument that the double aspect doctrine allowed both laws to apply. He held that double aspect only applies where the federal and provincial laws regulate different aspects of the same activity. It does not apply where both legislators “… have legislated for the same purpose and in the same aspect.”27 That was the problem in Bell Canada: the federal and provincial laws both regulated the same workplace for the same purpose. Allowing double aspect to apply would essentially create concurrent jurisdiction, contrary to the principle of exclusive jurisdiction.

40. The Appellant nonetheless seeks to apply the double aspect doctrine, citing the example of inter-provincial trucking. Saskatchewan respectfully submits that the case of trucking is significantly different from other federally regulated transportation, such as aviation, shipping, railways and pipelines, because trucking depends on the use of infrastructure under provincial jurisdiction, namely the highways. As well, the federal government has adopted provincial regulation of motor vehicles, applying that regulation to inter-provincial trucking. These significant differences allow for double aspect to apply to trucking, unlike transportation modes where the infrastructure (rail-lines, harbours, airports, pipeline) is under federal jurisdiction.28

25 Bell Canada, at 798. 26 Bell Canada, at 798. 27 Bell Canada, at 766, 853 [emphasis by Beetz J.]. 28 Coughlin v. Ontario Highway Transport Board et al., [1968] SCR 569; Motor Vehicle Transport Act, RSC 1985, c. 29 (3rd Supp.), ss. 2(1) (“extra-provincial motor carrier undertaking”), 7(1), (3). - 13 -

41. Overall, Bell Canada confirmed that health and safety issues in the operation of a federally regulated work or undertaking are part of the exclusive jurisdiction of the federal Parliament, and are not subject to provincial regulation. Saskatchewan submits that this principle applies generally to all health and safety issues of a federally regulated work or undertaking, not simply occupational health and safety of workers. The federal jurisdiction includes regulating the safe carriage of products shipped inter-provincially, whether by pipelines, railways, aviation, or shipping. That safe carriage includes the environmental aspects of transporting the product.

42. In Oldman River, Justice La Forest for the majority gave a detailed summary of the environmental jurisdiction of the federal government in relation to federally regulated railways. His comments are equally applicable to an inter-provincial pipeline, since the federal jurisdiction in both cases is grounded in s. 92(10)(a)29 and illustrate the broad scope of federal jurisdiction in relation to the construction, operation and maintenance of an inter-provincial pipeline, including the environmental aspects: To continue with the example, one might postulate the location and construction of a new line which would require approval under the relevant provisions of the Railway Act, R.S.C., 1985, c. R-3. That line may cut through ecologically sensitive habitats such as wetlands and forests. The possibility of derailment may pose a serious hazard to the health and safety of nearby communities if dangerous commodities are to be carried on the line. On the other hand, it may bring considerable economic benefit to those communities through job creation and the multiplier effect that will have in the local economy. The regulatory authority might require that the line circumvent residential districts in the interests of noise abatement and safety. In my view, all of these considerations may validly be taken into account in arriving at a final decision on whether or not to grant the necessary approval. To suggest otherwise would lead to the most astonishing results, and it defies reason to assert that Parliament is constitutionally barred from weighing the broad environmental repercussions, including socio-economic concerns, when legislating with respect to decisions of this nature.30

(3) Application to this Case 43. Saskatchewan submits that under these principles, the province does not have jurisdiction to regulate the product carried by a federally-regulated pipeline. The regulation of the types and quantity of product carried by a pipeline are part of the operation and management of the pipeline. It therefore falls to the exclusive jurisdiction of the federal government to regulate the product carried by the pipeline.

29 Campbell-Bennett, at 11. 30 Oldman River, at 66. - 14 -

44. That federal jurisdiction includes the environmental issues raised by the product being shipped. The product is an inextricable part of the operation of the pipeline, and therefore the environmental aspects fall to federal jurisdiction. Federal jurisdiction favours a single regulator of federally regulated works and undertaking. Once an undertaking is held to come within federal jurisdiction, the courts have rejected attempts to implement divided regulation. Safety concerns about the operation of the federally regulated undertaking fall solely to the federal Parliament.

45. As well, the principle set out in the Madden case makes it clear that a province cannot supplement federal health and safety laws, even if it believes that the federal law does not go far enough. A province cannot intrude on federal jurisdiction in that way.

46. In this case, the Proposed Bill would directly apply to someone “operating an industry”; would require that person to apply for a “hazardous substance permit” if the person proposed bringing in more “heavy oil” per year than it had previously done; would require that person to fulfill numerous conditions as a condition of the permit; and would give the Minister the power to enforce those limitations by applying to the British Columbia Supreme Court for a restraining order to enforce the permit requirements.31 As well, the Proposed Bill also imposes considerable operational requirements as a condition of the of the issuance of the permit. 32

47. If those conditions apply to an inter-provincial pipeline, they would regulate the operation of the pipeline and in pith and substance would be a matter of federal jurisdiction, ultra vires the province. Nor does double aspect apply. As in Bell Canada, both governments would be regulating the pipeline “for the same purpose and in the same aspect”.33 Double aspect cannot be used to give the province concurrent environmental jurisdiction over an inter-provincial pipeline.

D. Question 2: Inter-Jurisdictional Immunity 48. Saskatchewan submits that the principle of inter-jurisdictional immunity is a specialized application of the principle of the exclusive jurisdiction of Parliament to regulate federal works

31 Proposed Bill, s. 22.3(1); 22.4(2); 22.5; 22.7 (BC OC 211/2018, Appellant’s Record, at 75). 32 Proposed Bill, ss. 22.3(1), 22.4(2), 22.5. 33 Bell Canada, at 853. - 15 -

and undertakings. In fact, it is sometimes difficult to differentiate between the vires analysis of a statute, and the inter-jurisdictional immunity analysis.34

49. The principle of inter-jurisdictional immunity has been developed to help draw the boundary line for the application of provincial laws to works and undertakings under federal jurisdiction. “Immunity” is thus something of a misnomer. Federally regulated works and undertaking are generally subject to provincial laws.35 The purpose of the inter-jurisdictional immunity doctrine is to identify the core aspect of the federal work or undertaking which is under exclusive federal jurisdiction. It does not create a federal enclave, but is simply part of the allocation of regulatory responsibility between the federal and provincial governments.

50. There have been different approaches to this issue over the past century, with the principle being stated in different ways, such as “sterilization” or “affecting” the federal work or undertaking. However, in Canadian Western Bank, the Supreme Court settled on the test that a provincial law cannot “impair” the “essential and vital elements” of the federal undertaking. In making that point, the Court altered the test set out in Bell Canada, but continues to rely on Bell Canada’s general analysis of the principles governing inter-provincial works and undertakings.36

51. The cases provide guidance on this test. In Bell Canada, the Court held that health and safety concerns were part of the “essential and vital elements”. In COPA, provincial zoning laws could not block the location of a landing strip, while in Rogers Communications, the location of a cellular tower was held to be a core element of the federal jurisdiction, and therefore provincial zoning laws did not apply. By contrast, in Canadian Western Bank, the Court held that insurance sales were not part of the essential and vital elements of banking, while in Lafarge, the Court held that not all land use in Vancouver harbour was an “essential and vital element” of the port, and therefore inter-jurisdictional immunity did not block all application of municipal zoning laws.37

34 Régimbald and Newman, The Law of the Canadian Constitution, at para. 5.124. 35 Notre Dame de Bonsecours, at 372; British Columbia (Attorney General) v. Lafarge Canada Inc., 2007 SCC 23, [2007] 2 SCR 86 (“Lafarge”), at para. 42. 36 Canadian Western Bank, 2007 SCC 22, at para. 118. 37 Lafarge, at para. 42. - 16 -

52. Saskatchewan submits that this Court’s cases establish that provincial laws cannot regulate the product being carried by an inter-provincial pipeline. A pipeline is designed to ship a product, and regulating the type and quantities of the product that can be shipped would affect the basic purpose of the pipeline, which is a matter of exclusive federal jurisdiction. The type and quantity of the product is an “essential and vital element” of the inter-provincial pipeline. Health and safety issues relating to the operation of the pipeline, including environmental issues, all fall to the federal jurisdiction. Provincial regulation as set out in the Proposed Bill would intervene “directly and massively” into the federal regulation of the pipeline and would be inapplicable.

53. A pipeline without product is meaningless. There is no point in building a pipeline if it is not possible to ship a product via the pipeline. Consideration of the purpose to which the pipeline will be put, and the type of product to be shipped in it, are therefore “essential and vital elements” of the pipeline, not subject to provincial regulation. Safety standards, engineering, tariffs, projected costs and returns on investment, are all inextricably linked to the product intended to be shipped. That is why Parliament has given extensive jurisdiction to the NEB to regulate these issues, as part of the overall decision whether to permit the construction of the pipeline, and on what terms.38

54. The Appellant relies on a decision of the British Columbia Superior Court, Coastal First Nations, to support the argument that provincial environmental review laws can apply to federally regulated pipelines.39 Saskatchewan respectfully submits that the analysis of the court in that case is flawed in two ways. First, it confuses inter-jurisdictional immunity with paramountcy, in holding that the inter-jurisdictional immunity issue would only arise once it was known if the provincial conditions would conflict with the terms of the federal law. In COPA, McLachlin CJC held that this type of analysis is impermissible.40 Second, this analysis assumes that there is in fact provincial authority to review the federally regulated pipeline under provincial law. However, that was exactly the issue in CN v Courtois, part of the Bell Canada trilogy. Quebec had asserted that it could conduct an investigation into an accident which had resulted in the deaths of three CN

38 NEB Act, Part III: Construction, Operation and Abandonment of Pipelines. 39 Coastal First Nations v. British Columbia (Minister of Environment), 2016 BCSC 34, [2016] B.C.J. No. 30, at paras. 57 to 65. 40 COPA, para. 52. - 17 -

employees. This Court held that conducting a mandatory review of the accident was itself a form of regulating CN, even if no mandatory orders were subsequently made, and therefore was barred by inter-jurisdictional immunity.41

55. Saskatchewan also respectfully disagrees with the position of the Appellant that the caution in Canadian Western Bank, that inter-jurisdictional immunity should not be extended beyond existing precedents, applies here. The concern in Canadian Western Bank was whether inter- jurisdictional immunity should be extended to insurance sales by banks, an entirely new area. By contrast, there are ample precedents that inter-jurisdictional immunity applies to federally regulated works and undertakings, including pipelines.42 Indeed, inter-jurisdictional immunity has evolved primarily in the area of federally regulated works and undertakings. Saskatchewan submits that the item-by-item approach suggested by the Appellant is precisely the granular approach which the Supreme Court warned against in Bell Canada.43

56. Saskatchewan submits that the environmental aspects of the product carried by the pipeline are equally part of the “vital and essential element” of the inter-provincial work or undertaking. The federal government’s exclusive jurisdiction over the pipeline includes the power to regulate the environmental issues relating to the product being shipped. To borrow Justice Estey’s phrase from Johannesson,44 it would be “wholly impractical” if both the federal government and the provincial government could regulate the product carried by an inter-provincial pipeline. Saskatchewan submits that the proposed provincial law would be inapplicable to the pipeline, under the doctrine of inter-jurisdictional immunity.

E. Question 3: Paramountcy 57. The modern paramountcy doctrine began with Multiple Access v McCutcheon. Speaking for the majority in that case, Dickson J. (as he then was) set out the now-classic statement of paramountcy being based on operational conflict, where the individual could not comply simultaneously with both the federal and the provincial laws.45

41 CN v Courtois, at para. 51. 42 Campbell-Bennett, at 5. 43 Bell Canada, at 843. 44 Johannesson, at 19. 45 Multiple Access Ltd. v. McCutcheon, [1982] 2 SCR 161, at 191. - 18 -

58. The test for operational conflict was recently clarified in Alberta (Attorney General) v. Moloney.46 The federal Bankruptcy and Insolvency Act creates a “fresh start” for individuals discharged from bankruptcy, rendering their debts unenforceable. However, provincial legislation provided that in spite of a discharge, provincial authorities could deny driver’s licences until discharged bankrupts paid all moneys owing to provincial authorities for causing an accident. The majority of this Court found an operational conflict even though the debtor could technically comply with both pieces of legislation by forgoing their entitlement to drive. On this point, Gascon J. held “the test for operational conflict cannot be limited to asking whether the respondent can comply with both laws by renouncing the protection afforded to him or her under the federal law or the privilege he or she is otherwise entitled to under the provincial law.”47 This approach was applied identically in 407 ETR Concession Co. v. Canada (Superintendent of Bankruptcy).48

59. Lafarge also made this point. The majority of the Supreme Court found that municipal zoning laws and the regulations of the Vancouver Port Authority could not operate together and therefore the provincial regulations were inoperative under the paramountcy doctrine: The provincial Attorneys General argue that there is no operational conflict because Lafarge could apply for and obtain building permits from both the VPA and the City. But that argument overlooks the fact that the Lafarge project in its present form does not comply with the City’s by-law. The by-law imposes a 30-foot height restriction. It would be within the City’s discretion to waive the height limit up to 100 feet, but that would impose the condition precedent of an exercise of a discretion by the City to approve a project that has already been approved by the VPA. This would create an operational conflict that would flout the federal purpose, by depriving the VPA of its final decisional authority on the development of the port, in respect of matters which fall within the legislative authority of Parliament.49

60. Saskatchewan submits that the Proposed Bill would clearly trigger an operational conflict. The NEB and federal Cabinet have issued a permit to build and operate the pipeline, creating a legal entitlement to do so. The Proposed Bill would say that the pipeline cannot be operated as set out in the permit. Proponents of the pipeline could only comply with the Proposed Bill by forgoing an entitlement guaranteed by federal law. That is an operational conflict.

46 Alberta (Attorney General) v. Moloney, [2015] 3 SCR 327. 47 Moloney, at para 60. 48 407 ETR Concession Co. v. Canada (Superintendent of Bankruptcy), 2015 SCC 52, [2015] 3 SCR 397. 49 Lafarge at para. 75 - 19 -

61. This Court has also developed a second branch to the paramountcy test, namely the frustration of the federal purpose. Rothmans Benson and Hedges Inc. v. Saskatchewan, is one of this Court’s major cases on the concept of frustration of the federal purpose. Writing for a unanimous Court, Justice Major set out the frustration test: “Provincial legislation that displaces or frustrates Parliament’s legislative purpose is also inconsistent for the purposes of the doctrine.”50 Major J. went on to find that there was no frustration of the federal purpose in the case of tobacco displays, because the purpose of both laws was to restrict access to tobacco by minors. Since both laws had the same purpose, the stricter provincial law did not frustrate the federal law.

62. Similarly, in Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd., federal and provincial laws both provided for stays of proceedings against farmers in debt collection actions. Since both the federal law and the provincial law provided for those delays, there was no frustration of the federal purpose relating to receivers under the Bankruptcy and Insolvency Act.51

63. By contrast to those two cases, Moloney and 407 ETR Concession Co. both held that provincial laws did in fact frustrate the federal purpose, because provincial laws in those cases would allow the recovery of money from the bankrupts, in spite of the discharge. If provincial law applied, the discharged bankrupts would not get the benefit of the discharge under federal law.

64. Saskatchewan submits that there are clear parallels between this case and Moloney and 407 ETR Concession Co. The Proposed Bill would frustrate the purpose of the extensive body of federal law which regulates the construction and operation of inter-provincial pipelines. The comprehensive federal law allows the shipment of product by pipeline, if all the requirements of the federal law are met. Conversely, the purpose of the Proposed Bill is to implement a hazardous substance permit regime which restricts the shipment of product, frustrating the federal purpose. To this end, it bears repeating, that a pipeline without product is meaningless. British Columbia’s Proposed Bill renders the pipeline effectively inoperable, as the Court of Appeal found.

50 Rothmans, Benson & Hedges Inc. v. Saskatchewan, [2005] 1 SCR 188, at paras 12-13. 51 Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd., [2015] 3 SCR 419 at paras. 69-71.

- 21 -

PART VII: TABLE OF AUTHORITIES

STATUTES Paragraph(s) Canadian Energy Regulator Act, SC 2019, c. 28, s. 182 21 Canadian Environmental Assessment Act, 2012, SC 2012, c. 19, ss. 32-37 21 Constitution Act, 1867, s. 91, 92, 92A, 94A, 95, 109 10, 16, 18, 19, 30, 31 Motor Vehicle Transport Act, RSC 1985, c. 29 (3rd Supp.), s. 2, 7 40 National Energy Board Act, RSC 1985, c. N-7, Part III 21, 38

CASES Paragraph(s) Alberta (Attorney General) v. Moloney, 2015 SCC 51, [2015] 3 SCR 327 58, 63, 64 Attorney General for Quebec v. Nipissing Central Railway Co., [1926] AC 12 715, [1926] UKPC 39 (PC) Bell Canada v. Quebec (Commission de la Santé et de la Sécurité du 13, 24, 32, Travail), [1988] 1 SCR 749 36-39, 41, 47, 51, 55 British Columbia (Attorney General) v. Lafarge Canada Inc., [2007] 2 SCR 51, 59, 65 86, 2007 SCC 23 Campbell-Bennett v. Comstock Midwestern Ltd., [1954] SCR 207 4, 42, 55 Canadian Pacific Railway v. Notre Dame de Bonsecours, [1899] AC 367 24, 34, 49 (PC) Canada Post Corporation v. City of Hamilton, 2016 ONCA 767 65 Canadian Western Bank v Alberta, 2007 SCC 22, [2007] 2 SCR 3 50, 51 CN v. Courtois, [1988] 1 SCR 868 36, 54 Coastal First Nations v. British Columbia (Minister of Environment), 2016 54 BCSC 34, [2016] B.C.J. No. 30 Consolidated Fastfrate Inc. v. Western Canada Council of Teamsters, 2009 9 SCC 53, [2009] 3 SCR 407 Coughlin v. Ontario Highway Transport Board et al., [1968] SCR 569 40 Friends of the Oldman River Society v. Canada (Minister of Transport), 15, 17, 21, 42 [1992] 1 SCR 3 Johannesson v. West St. Paul (Rural Municipality), [1952] 1 SCR 292 4, 12, 56 Madden v. Nelson and Fort Sheppard Railway Company, [1899] AC 626, 34, 35 [1899] UKPC 47 (PC) - 22 -

CASES Paragraph(s) Multiple Access v. McCutcheon, [1982] 2 SCR 161 57 Quebec (Attorney General) v. Canadian Owners and Pilots Association, 4, 51, 54 2010 SCC 39, [2010] 2 SCR 536 Quebec (Minimum Wage Commission) v. Construction Montcalm, [1979] 1 24 SCR 754 R. v. Canadian Pacific Ltd., [1995] 2 SCR 1028 24 R. v. Hydro-Québec, [1997] 3 SCR 213 15, 17 Regulation and Control of Aeronautics in Canada, Re, [1932] AC 54, [1931] 4, 12 UKPC 93 (PC) Regulation and Control of Radio Communication in Canada, Re, [1932] AC 4, 12 304, [1932] UKPC 7 (PC) Rogers Communications Inc. v. Châteauguay (City), 2016 SCC 23, [2016] 1 4, 51 SCR 467 Rothmans, Benson & Hedges Inc. v. Saskatchewan, [2005] 1 SCR 188, 2005 61 SCC 13 Saskatchewan (Attorney General) v. Lemare Lake Logging Ltd., 2015 SCC 62 53, [2015] 3 SCR 419 407 ETR Concession Co. v. Canada (Superintendent of Bankruptcy), 2015 58, 63, 64 SCC 52, [2015] 3 SCR 397

TEXTS AND OTHER AUTHORITIES Paragraph(s) Newman, Natural Resource Jurisdiction in Canada (Markham: LexisNexis 67 Canada, 2013), p. 125 Confederation Debates: Parliamentary Debates on the Subject of the 7, 9 Confederation of the British North American Provinces, Eighth Parliament, 3rd Session, pp. 3, 6-7, 55-56, 107-108, 365, 417, 574, 816-817 Régimbald and Newman, The Law of the Canadian Constitution, 2nd ed. 21, 48 (Toronto: LexisNexis, 2017), paras. 5.124, 14.20