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e—document T-982-19 FEDERAL COURT f COUR FEDERALE E L P oE Noseli2§31§19No. T-982-19 0s E FEDERAL COURT Svetlana Dobrota Between Vancouver, BC

Attorney General of British Columbia Plaintiff

And

Attorney General of Alberta Defendant

MOTION RECORD

The Attorney General of British Columbia’s Response to the Defendant’s Application to Strike the Action

Hearing Date: September 1212-13,-13, 2019

Attorney General of British Columbia Attorney General of Alberta Plaintiff Defendant

J. Gareth Morley and Robert Danay Evan Dixon and Paul Chiswell Ministry of Attorney General Burnet,Bumet, Duckworth & Palmer LLP Legal Services Branch 2400, 525 —– 8 Avenue SW 13011301-865-865 HombyHornby Street Calgary, Alberta T2P 1G11G1 Vancouver, British Columbia V6Z 2G3 Tel: 403403-260-0162-260-0162 Tel: 604604-660-3093-660-3093 Fax: 403-260-0332403-260-0332 Fax: 604604-660-2636-660-2636 Email: [email protected] Email: [email protected] [email protected] [email protected]

INDEX

TAB PLEADING PAGE

Plaintiff’sPlaintiffs MemoraMemorandumndum of Argument in Response to the Defendant’s 1 1 Application to Strike, dated September 11,11, 2019

TABTAB 11 1

No. T-982-19

FEDERAL COURT

Between

Attorney General of British Columbia Plaintiff

And

Attorney General of Alberta Defendant

MEMORANDUM OF FACT AND LAW OF THE ATTORNEY GENERAL OF BRITISH COLUMBIA

Alberta’s Application on Jurisdiction

Attorney General of British Columbia Attorney General of Alberta Plaintiff Defendant

J. Gareth Morley and Robert Danay Evan Dixon and Paul Chiswell Ministry of Attorney General Burnet,Bumet, Duckworth & Palmer LLP Legal Services Branch 2400, 525 —– 8 Avenue SW 1301-8651301-865 HornbyHomby Street Calgary, Alberta T2P 1G11G1 Vancouver, BBritishritish CColumbiaolumbia V6Z 2G3 Tel: 403-260-0162 Tel: 604-660-3093 Fax: 403-260-0332 Fax: 604-660-2636 Email: [email protected] Email: [email protected]@gov.bc.cac.ca [email protected] [email protected]

Table of Contents

PART I —– STATEMENT OF FACT ...... 11 Overview ...... 11 Facts ...... 3 Proceeding in Alberta’s Court of Queen’s Bench...... 6 Description of the Action —– The Section 92A Claim ...... 8 Description of the Action —– Section 121121 of the Constitution Act, 1867I867 ...... 9 PART II —– STATEMENT OF POINTS IN ISSUE ...... 10 PART III —– STATEMENT OF SUBMISSIONS ...... 11 A. Rule 221 ...... 1111 B. Section 1919 Should Be Interpreted Using the Principles of Statutory Interpretation ...... 1111 C. The Ordinary Meaning of the French and English Text of Section 1919 Includes Actions for Declaration of Invalidity ...... 1414 D. The Historical Context and Jurisprudence: “Controversies” Have Always Included Constitutional Questions ...... 1515 E. The Continuing Purpose of Section 1919 Fits Constitutional Controversies Particularly Well 21 F. This Action Is About Legal Rights, Obligations and Liabilities That May Exist Between Governments ...... 22 G. The Action is Not Premature ...... 27 PAPARTRT IV —– ORDERS SOUGHT ...... 30 PART V —– LIST OF AUTHORITIES ...... 31

PART I —– STATEMENT OF FACT

Overview

1.1. Section 1919 of the Federal Courts Act gives this Court jurisdiction to decide “controversies”/”“controversies”/”lesles cas de litigelitige”” between two provinces if the legislatures of the contending provinces pass legislation granting such jurisdiction.1jurisdiction.1 The legislatures of Alberta and British Columbia have both done so.so.22 The Attorney General of British Columbia (“AG BC”) has brought an action for a declaration that Alberta’s Preserving Canada’sCanada ’s Economic Prosperity Act3Act3 - colloquially known as the “Turn Off the Taps” law -- is unconstitutional. The Attorney General of Alberta (“AG Alberta”) vigorously opposes. The question is whether this is a “controversy” that this Court can and should hear.

2. The Act gives Alberta’s Minister of Energy (the “Minister”) the power to restrict supplies of refinedrefined fuels, crude oil and naturnaturalal gas from Alberta to British Columbia. Legislative debates at the time the Act was adopted mademade it clear that the intended effect of the Act was to give the Minister a “weapon” to use against British Columbia in retaliation forfor,, or in order to exert control over, British Columbia’s position on the Trans Mountain Expansion Project. British Columbia receives the vast majority of its refinedrefined fuelfile] and light crude from Alberta. The idea of the Act was to allow the Minister to leverage this interdependence —– developed on the assumption that British Columbia, as part of Canada, had fuel security —– to affect the politics of British Columbia.

3. The AG BC contends that the Act is contrary to two sections of the Constitution Act, 1867:1867: s. 92A(292A(2)) —– which limits provincial authority over petroleum exports to unreunrefinedﬁned products and forbids authorizing or providing for discrimination against other parts of Canada in price or supply —– and s. 121,121, which guarantees free admission of products of one province into another.

11 Federal Courts Act,Act, RSC 1985,1985, c F-7F-7,, s. 1919.. The English and French versions are set out in full in Part III. 2 Judicature Act,Act, RSA 2000, c J-2,J-2, s. 27(b) (“The .... Federal Court of Canada, […],[. . .], according to the Federal Courts Act (Canada) [has][has] jurisdictionjurisdiction […][. . .] (b) in controversies between Alberta and any ototherher province or territory of Canada in which an Act similar to this Act is in force”). The wording of s. 1(1)(b)1(1)(b) of the Federal Courts Jurisdiction Act, RSBC 1996,1996, c. 135135 is iidenticaldentical with the substitution of “British Columbia” for “Alberta”. 3 S.A.SA. 2018, c. P. 21.5 (the “Act”) 4 --2- 2 -

4. The AG Alberta has responded with an application under Rule 221 to strike the AG BC’s claim, without a hearing on the merits, on the ground it “discloses no cause of action.” It says the AG BC’s Claim is “plainly and obviously” not a “c“controversy”ontroversy” between British Columbia and Alberta, and therefore this Court has no jurisdiction under s. 19.19. It also says it is also plain and obvious that the declaratory relief sought is premature.

5. If a case in which one province threatens another with trade sanctions and the other responds that the threat is unconstitutional is not a “controversy”, it is difficultdifﬁcult to think what would be. As the Federal Court of Appeal has recently stated, there is “no limit” as to the type of controversy to which s.5. 1919 apapplies.4plies.4 The jurisdictionjurisdiction to hear these disputes comes from (is “nourished” by) the provincial legislatures themselves and not only from Parliament and covers matters within s. 92 of the Constitution Act.5Act.5 The ordinary and common meaning of the English and French text, the historical context of section 1919 and its predecessors,predecessors, and the purpose of the section all support a broad meaning for the word “controversy,” including constitutional controversies. The Federal Court has recently confirmedconﬁrmed that it has the power to issue declarations of invalidity under s. 52 of the Constitution Act, 19821982.. 6

6. PerplexinglyPerplexingly,, the AG Alberta says the AG BC is not asserting a legal right, obligation or liability between the two governments. Nothing could be further from the truth. The principles of the rule of law and constitutionalism mean that all legislatures have an obligatobligationion not to enact unconstitutional statutes, and all Canadians have a right not to be adversely affected by such statutes. On the facts as pleaded, the AG BC seeks to vindicate the right of residents of British Columbia not to be deliberately harmed by what it says is unconstitutional legislationlegislation.. Moreover, both section 92A(2) and section 121121 of the Constitution Act, 1867 create rights. British Columbia alleges its right under s. 92A(2), as a “part of Canada”Canada”,, not to be subject to authorized or actual discrdiscriminationimination by other provinces in their laws governing exports of natural resources,resources, has been breached,breached, as has its right, under section 121,121, not to have the free admission of articles of produce interfered with for tariftariff-likef-like purposes.purposes. Whatever the merits ooff these

4 Alberta v. CanadaCanada,, 2018 FCA 8383,, par. 2626.. 5 Alberta v. Canada, par. 34 The exception is that “controversies” must be civil, as opposed to criminal. 6 Bilodeau-Massé v. Canada (Attorney General)General),, [2018][2018] 11 FCR 386, 2017 FC 604604,, par. 38-88. See also Deegan v. Canada (Attorney General)General),, 2019 FC 960, at par. 212-240212-240.. 5 --3- 3 -

claimsclaims,, they involve the obligations of Alberta and the rights of British Columbia, and are the subject matter of a controversy/controversy/litigelitige which this Court has jurisdictionjurisdiction to adjudicate.

7. The AG Alberta’s second reason to deny a trial of this action iiss that it will be premature until the Minister actually exercises her powers to disrupt supplies of petroleum products to British Columbia. There is no merit in this argument either. The Minister cannot breathe life into an invalid statute by forbearing foforr the time being from resorting to its illegal powers. Declarations, of their very nature, are designed to prevent prospective harm. Members of the Alberta Legislature compared the Act to a “loaded gun” aimed at “the government in Victoria.” The AG BC is not compelled to wait until it goes off to ask for a determination as to whether Alberta has a constitutional licence to carry it. The AG BC’s action does not depend on “various hypotheticalshypotheticals in which the Minister would be using her powers in an unconstitutional manner.”manner.”77 The AG BC’s claim is that right now and without anything further,ﬁlrther, the Act is unconstitutional whatever the Minister does and whether she does anything at all. Unless ththisis is plainly and obviously without merit, it should be permitted to go to trial.

Facts

8. It is common ground that on an application under Rule 221, the facts as pleaded must be accepted as true. The Court can also take judicial notice of officialofﬁcial statements made in the Alberta Legislature and, of course, the provisions of the Act.Act. For the purposes of this application, therefore, the following facts must be taken as given, although some will have to be proven by the AG BC at trial.

9. When it was passed, the central feature of the Act was understood by all members of the Alberta Legislature to be that it would give the Minister the power to punish or threaten to punish the residents of British Columbia for positions taken or perceived to be taken by the governmegovernmentnt of British Columbia. Approximately 55% of British Columbia’s gasoline and 71% of its diesel comes directly from Alberta rerefineries.fineries. In addition, approximately 25% of each of these two refinedrefined fuelsfilels is produced in the Parkland refinery,refinery, which receives ititss crude feedstock from Alberta. The Act was referred to by members of the Legislative Assembly, without

7 AG Alberta Memorandum, paragraph 4. 6 --4- 4 -

contradiction, as a “loaded weapon” aimed at British Columbia. 8

10.10. On its terms, the Act purports to give the Minister the power to issue an order that wouldwould have the effect of making it an offence to export oil, gas or refinedreﬁned fuels from Alberta without a licence.licence.99 There is no statutory requirement to grant a licence and so the Minister is empowered to prevent all exports carried out by a specificspeciﬁc person.

11.11. The terms of a licence would be subject to conditions determined by the Minister, based on her interpretation of the public interest.1010 Among thesethese conditions are restrictionsrestrictions on the point in Alberta from which the oil, gas or refinedreﬁned fuelﬁle] are exported and the amounts, thereby allowing the Minister to determine what jurisdictionjurisdiction the fuel would be exported to and in what quantities.quantities.1111 No regulations have yet been enacted to set out the process for obtaining a licence.

12.12. Bill 12,12, the bill that became the Act was firstﬁrst announced by the thenthen-Minister-Minister of Energy, on April 9, 2018, one day after Kinder Morgan Canada Limited announced it was going to suspend construction on the Trans MountMountainain Expansion Project due to alleged political uncertaintyuncertainty..1212

13.13. In Question Period, the thenthen-Minister-Minister was asked, “How are we working to ensure that Alberta’s oil and gas resources make it to market through projects like the Trans Mountain pipeline?” She respresponded,onded, “We’re going to be introducing legislation shortly which will inflictinﬂict pain on British Columbia.”Columbia.”1313

14.14. The thenthen-Minister-Minister went on to say that the legislation would “limit resources being exported to BC.”B.C.” in order to “inflict“inﬂict pain on those economic decisions so they understand what they’ve done.”done. ”1414 The thenthen-Leader-Leader of the Opposition, Jason Kenney, told the Alberta Legislative Assembly, “I’ve said we should be prepared to […][...] turn off the taps of the shipments that

8 Statement of Claim, _paras. 3, 14-23. 9 Act, ss. 2(1), 2(2). 101° Act, ss. 2(3), 4(1). 1111 Act, s. 4(2)(a). 1212 Statement of Claim, para. 1313-15.-15. 1313 Chipera, Exhibit A, Alberta Hansard, April 9, 2018, p. 440. 1414 Chipera, Exhibit A, Alberta Hansard, April 9, 2018, p. 441. 7 --5- 5 -

currently fuel the Lower Mainland economy.”economy. ”1515

15.15. Bill 1212 was given firstﬁrst reading on April 16,16, 2018.2018.1616 Statements in debate on second reading, in committee and on third reading, by members on both sides of the House and by the responsible minister all indicated that it was widely understood that the point of the bill would be to give the government of Alberta the ability to threaten reduction in supplies of petroleum products to British Columbia to retaliate against perceived obstruction by the British Columbia 1 7 government.17

16.16. The following examples illustrillustrateate that the members of the Alberta Legislature, on both sides, understood that they were providing these powers to the Minister of Energy so that he or she could use them in conflictconﬂict with British Columbia:

The bottom line, Mr. Speaker: the B.C.BC. government cannot continue to delay the Trans Mountain pipeline project without economic consequences. (Hon. Craig Coolahan, Calgary-Calgary-Klein,Klein, NDP).18NDP).18

Mr. Speaker, Bill 1212 is a loaded economic weapon. Make no mistake. If the NDP government aims Bill 1212 at British Columbia and pulls the trigger, there will be consequences…[T]heconsequences. . .[T]he United Conservative Party OfficialOfﬁcial Opposition is prepared to help the NDP government. We'll help you load this economic weapon by supporting Bill 1212 (Hon. Prasad Panda, Calgary-Foothills, UCP).19UCP).19

[I]f[I]f British Columbia's NDP government starts a trade war, Alberta must end it, and the NDP government in B.C.BC. must understand that there will be very serious consequences should they proceed with their threatened blockage of this essential national infrainfrastructurestructure project (Hon. Jason Kenney, Calgary-Lougheed, UCP) 20

But, Madam Speaker, herehere's's the point. Perhaps if we turned off the taps, it wouldn't be a buck 70 a litrelitre.. It would be $2.50 or $3 or $3$3.50.50 a litrelitre,, and perhaps ordinary, hardhard-working-working British Columbians would pick up the phone and call their NDP

1515 Chipera, Exhibit A, Alberta Hansard, April 9, 2018, p. 451. 1616 Chipera, Exhibit B, Alberta Hansard, April 16,16, 2018, p. 547. 1717 See, for example, Chipera, Ex F, Alberta Hansard,Hansard, May 2, 2018, p. 736, 744; Exhibit J, Alberta Hansard,Hansard, May 10,10, 2018, p. 1000;1000; Exhibit K, Alberta Hansard,Hansard, May 16,16, 2018, p. 1135,1 135, 1152.1152. 1818 Chipera, Exhibit F, Alberta Hansard,Hansard, May 2, 2018, p. 736. 1919 Chipera, Exhibit F, Alberta Hansard,Hansard, May 2, 2018, p. 737. 20 Chipera, Exhibit F, Alberta Hansard,Hansard, May 2, 2018, p. 738. 8 --6- 6 -

MLAs and say: "What have you done to our economy? What have you done to our standard of living?" (Hon. Jason Kenney, Calgary-Lougheed, UCP) 21

The situation is one where we need to arm ourselves with all of the tools necessary in order to show that there are consequenceconsequencess for the position that the B.C.BC. government is taking and that consequences will result in higher prices for petroleum products in British ColumbiaColumbia,, thus keeping momentum on the current increase in support for this pipeline in British Columbia (Hon. Lorne Dach, Edmonton-McClung, NDP).22NDP).22

17.17. Members expressed concern that the economic effects on Alberta of using the Act would be negative,23negative,23 with the only justijustificationﬁcation as a strategic threat or “weapon” in a perceived conflictconﬂict with the government of British Columbia.Columbia.2424

18.18. The Act was declared into force on April 30, 2019.

Proceeding in Alberta’s Court of Queen’s Bench

19.19. On May 11,, 20192019,, the AG BC brought an action for a declaration of invalidity in the Court of Queen’s Bench in Alberta. The AG Alberta filedﬁled an application to dismiss on the grounds the Court of Queen’s Bench lacked jurisdictionjurisdiction or the AG BC lacked standing. The AG BC filedﬁled an action iinn this Court on June 14,14, 2019, stating at paragraph 45, ““TheThe Attorney General of British Columbia takes the position in the Alberta Court of Queen's Bench that his controversy with the Attorney General of Alberta can be heard on the merits in the superior courts of Alberta.Alberta.””

20. On June 28, 2019, Justice Hall of the Court of Queen’s Bench released his decision on Alberta’s application.application.2525 He declined to dismiss the action, but stayed it pending a determination by this Court as to whether it would take jurisdiction.jurisdiction.

21. Justice Hall made the following points in his reasons for judgment:judgment:

a. One of the purposes of the law of standing is to ensure that those who have been

21 Chipera, Exhibit F, Alberta Hansard,Hansard, May 2, 2018, p. 742. 22 Chipera, Exhibit K, Alberta Hansard,Hansard, May 16,16, 2018, p. 1146.1146. 23 See, for example, Chipera, Exhibit F, Alberta Hansard,Hansard, May 2, 2018, pp. 737, 745; Exhibit K, Alberta Hansard,Hansard, May 16,16, 2018, p. 1138.1138. 24 See, for example, Chipera, Exhibit F, Alberta Hansara',Hansard, May 2, 2018, p. 737; Exhibit I,1, Alberta Hansard,Hansard, May 10,10, 2018, p. 995. 25 British Columbia (Attorney General) v. Alberta (Attorney General), 2019 ABQB 550550.. 9 --7- 7 -

harmed by unconstitutional action have access to an independent and impartial tribunal that can hold state actors, including legislatures, accountable to comply with the law, especially the Constitution.Constitution.2626

b. Declaratory relief is one of the main tools invoked in constitutional challenges. The ability to declare that a statute is unconstitutional, under eieitherther the federal division of powers or the CharterCharter,, is now considered part of the inherent powers of the provincial superior courts.courts.2727

c.0. The Federal Court is the proper forum for this particular interprovincial dispute.dispute.2828

d.(1. The AG BC does not have direct standinstandingg to seek a declaration of invalidity because, as a result of s. 25 of Alberta’s Judicature Act, only the AG Alberta and the Attorney General of Canada have direct standing to seek a declaration of invalidity in the provincial superior courts in Alberta.Alberta.2929

e. There is clearly a serious justiciablejusticiable issue raised and the AG BC clearly has a genuine and real stake in the issue.issue.3030

f. The availability of an action in the Federal Court as of right weighs against granting public interest standing in this Court. The purpose of granting public interest standing is to prevent the possibility that legislation will be immunized from judicialjudicial scrutiny.scrutiny.3131

22. The AG BC did not appeal Mr. Justice Hall’s order, because it agrees that the Federal Court has concurrent jurisdictionjurisdiction and the crucial objective from its perspective is that the legislation be subject to timely judicialjudicial scrutiny. The AG BC should be clear, though, that it does not agree with Mr. Justice Hall’s statement that only the AG Alberta and the Attorney General of Canada hhaveave direct standing to seek a declaration of invalidity against an Alberta statute in provincial superior courts. The AG BC would point to thousands of cases in which other parties

26 Par. 1010.. 27 Par. 1111.. 28 Par..33. 29 Par. 2525.. 303° Par. 46-47.46-47. 31 Par. 5252.. 101O --8- 8 -

have sought —– and often obtained —– declarations of invalidity without seekiseekingng damages in Alberta’s superior courts or in the superior courts of other provinces (like British Columbia) that have similar statutory provisions. 32 If Alberta’s Judicature Act did have this meaning, the AG BC continues to be of the viewView that it would be selfself-evidently-evidently contrary to s. 96 of the Constitution Act, 18671867.33.33 But these are not matters before this CCourt.ourt. The AG BC agrees with Mr. Justice Hall that this is precisely the sosortrt of dispute for which s. 1919 of the Federal Courts Act was enactedenacted..

23. As a result of Mr. Justice Hall’s decision, the parties agreed to vacate the stay of this action and have this application and the AG BC’s application for an injunction heard together.

DeDescriptionscription of the Action —– The Section 92A Claim

24. As a general matter, provinces have no constitutional authority to legislate in relation to interprovincial or international exports. While provincial legislation can incidentally affect exports, if its “pith and substance” or “dominant characteristic” is to restrict exports from the province — – as is indisputably the case for the Act —– it would, in general, be ultra vires the - 34 prov1nce.province.34

25. As an exception, and as a result of a multi-yearmulti-year bargaining process in the late 1970s1970s and early 1980s1980s between the resource exporting provinces, on the one hand, and the importing provinces and federal government on the other, s. 92A(2) of the Constitution Act, 1867 empowers provincial legislatures to make laws in relation to “th“thee export from the province to another part of Canada of the primary production from non-renewablenon-renewable natural resources and forestry resources in the province and the production from facilities in the province for the generation of electrical energy.” Section 92A (2) is subject to two provisos:

a. First, it applies only to the “primary production” of nonnon-renewable-renewable natural resources (the “Primary Production Proviso”).

32 A prominent example would be VriendVriend v. Alberta,Alberta, [1998][1998] 11 SCR 493. 33 Nigel Bankes, “The Bill 1212 ‘Turn Off the Taps’ Litigation: Justice Hall Orders a Stay in BC’s Action (July 23, 2019) (ablawg.ca) 34 Constitution Act, 1867,I867, s. 91(291(2);); Lawson v. Interior Tree Fruit and VegetableVegetable Committee of Direction,Direction, [1931][1931] S.C.R.SCR. 357357;; Canadian Industrial Gas & Oil Ltd. v. SaskatchewanSaskatchewan,, [1978][1978] 2 S.C.R.SCR. 545545;; Central Canada Potash Co. Ltd. et al. v. Saskatchewan,Saskatchewan, [1979][1979] 11 S.C.R.SCR. 42 [[CentralCentral Canada Potash]|.. 11 --9- 9 -

b. Second, such laws “may not authorize or provide for discrimination in prices or in supplies exported to another part of Canada “ (the “Non-“Non-DiscriminationDiscrimination Proviso”)

26. “Primary production” of non-renewablenon-renewable resources is defineddefined in the Sixth Schedule to the Constitution Act, 1867.I867. To the extent the Act purports to include refinedrefined fuels,fiiels, the AG BC will argargueue it falls afoul of the Primary Production Proviso and is unconstitutional for this reason.

27. The Non-DiscriminationNon-Discrimination Proviso is one of two instances in Part VI of the Constitution Act, 18671867 in which legislative authority is granted subject to guarantees to other parties, the other being the grant in section 93 of the Constitution Act, 1867 of legislative authority to the provincial legislatures of authority to make laws in relation to education, subject to the denominational rights as set out thereintherein..

28. On its own terms, the Non-DiscriminationNon-Discrimination Proviso is a right for the benebenefitﬁt of “any part of Canada.” The AG BC will argue that this includes British Columbia and that the AG BC is a natural party to vindicate the rights of the residents of British Columbia not to be subject to discrimination by petroleum-exporting provinces. The AG Alberta correctly says no province has “a legal right to an unregulated supply of petroleum products from Alberta”, but of course, s. 92A(2) creates a legal right that those regulations be non-discriminatorynon-a’iscriminatory.35.35 More precisely it creates a right in every part of Canada not to be subject to measures that provideprovide for discrimination or authorize discrimination.

29. The Non-DiscriminationNon-Discrimination Proviso has never been given judicial consideration. The AG BC will argue that it applies where the purpose of a provincial statute restricting exports is to give an executive officialofﬁcial authority so that it can be exercised at the expense of an iimportingmporting province in a dispute. The AG BC will have to show ththatat the Act exceeds Alberta’s legislative powers, in part by violating this right to non-non-discrimination.discrimination.

Description of the Action —– Section 121 of the Constitution Act, 1867

30. Section 121121 of the Constitution Act, 1867I867 provides as follows:

All Articles of the Growth, Produce, or Manufacture of any one of the Provinces shall, from and after the Union, be admitted free into each of the other Provinces.

35 AG Alberta Memorandum of Argument, para. 46. 12 --10- 10 -

31. Although it is part of the Constitution Act, 1867,I867, section 121121 is not part of the division-of- powers. Rather, it provides a right of “each of the Provinces” to having goods “admitted free” and a correlative duty on each of them to refrain from measures that in essence and primary purpose would restrict the trade of goods across a provincial border.

32. Section 121121 was recently given thorough consideration by the Supreme Court of Canada in R. v ComeauComeau.36.36 At paragraph 111,111, the Supreme Court of Canada stated the following:

If the law does not in essence restrict ththee trade of goods across a provincial border, the inquiry is over and s. 121121 is not engaged. If it does, the claimant must also establish that the primary purpose of the law is to restrict trade. A law may have more than one purpose. But impeding trade must be its primary purpose to engage s. 121.121. The inquiry is objective, based on the wording of the law, the legislative context in which it was enacted (i.e. if it is one element of a broader regulatory scheme), and all of the law’s discernablediscemable effects (which can include much more than its tradetrade-impeding-impeding effect). If the purpose of the law aligns with purposes traditionally served by tariffs, such as exploiting the passage of goods across a border solely as a way to collect funds, protecting local industry or punishingpunishing another province,province, this may, depending on other factors, support the contention that the primary purpose of the law is to restrict trade [….][. . ..]3737

33. The AG BC’s claim is that the essence of the Act is to restrict the trade of goods across the BCBC-Alberta-Alberta border, and the purpose of the Act alignalignss with punishing British Columbia and is therefore tarifftariff-like.-like.

34. Of course, the AG Alberta has not yet even provided a Statement of Defence to respond to the AG BC’s claim on the merits. But the question here is not whether the AG BC will succeed, but whether its claims amount to a “controversy” or “litige.”

PART II —– STATEMENT OF POINTS IN ISSUE

35. This application raises the following issues:

a. Is it plain and obvious that this action does not give rise to a “controversy” (“(“litige”)litige”) between British Columbia and Alberta?

b. Is it plain and obvious that this action is premature?

36 R. v. ComeauComeau,, [2018][2018] 11 SCR 342, 2018 SCCscc 1515 37 Para 111111.. Emphasis added. 13 --11- 11 -

PART III —– STATEMENT OF SUBMISSIONS

A. Rule 221

36. It is common ground between the parties that the test on an application under Rule 221 is whether it is plain and obvious that the action must fail. This standard applies justjust as much when the issue raised on a Rule 221 application is jurisdiction.38jurisdiction.38

37. On a RRuleule 221 application, it is not determinative that the law has not yet recognized the particular claim. The approach must be generous and err on the side of permitting a novel but arguable claim to proceed to triatrial.1.3939 The AG Alberta’s assertions that there aarere no prior examples of one province challenging another province’s legislation using section 1919 are therefore beside the point. From the AG BC’s perspective, this lack of precedent can be explained by the fact that provinces rarely, if ever, enact legislalegislationtion with the express purpose of “causing pain” to other provinces and that when significantsigniﬁcant interinter-provincial-provincial constitutional disputes have materialized, the enacting provinces have typically referred the legislation to their own Courts of Appeal, something Alberta has resolutely refused to do. 40

B. Section 19 Should Be Interpreted Using the Principles of Statutory Interpretation

38. Section 1919 states as follows:

Intergovernmental disputes Différends entre gouvernements

19. If the legislature of a province has 19. Lorsqu’une loi d’une province passed an Act agreeing that the Federal reconnaitreconnaît sa compétence en l’espèce,l’espéce, — Court, the Federal Court of Canada or the qu’elle y soit désignée sous le nom de Exchequer Court of Canada has jurisdiction Cour fédérale, Cour fédérale du Canada in cases of controversies between Canada ou Cour de l’Échiqul’Bchiquierier du Canada — la and that province, or between that province Cour fédérale est compétente pour jugerjuger and any other province or provinces that les cas de litige entre le16 Canada et cette

38 Alberta v. Canada, para. 2020.. 39 R. v. Imperial Tobacco Canada Ltd.,Ltd., [2011][20111 3 SCR 45, 2011 SCCscc 42, par. 21 40 For examples, see Reference re UpperUpper Churchill WaterWater Rights Reversion Act,Act, [1984][1984] 11 SCR 297m (Newfoundland vs. Québec);Quebec); Reference re Pan‑-CanadianCanadian Securities Regulation,Regulation, 2018 SCC 48ﬂ (Québec, Alberta, Manitoba vs. British Columbia, Ontario, Nova Scotia, New Brunswick, Prince Edward Island and Saksatchewan); Reference re Environmental Management Act (British Columbia)Columbia),, 2019 BCCA 181181 (British Columbia vs Alberta and Saskatchewan) 14 -_ 1212 -_

have passed a like Act, the Federal Court province ou entre cette province et une ou has jurisdiction to determine the plusieurs autres provinces ayant adopté controversies. une loi semblable.

39. The scope of section 1919 should be determined using the ordinary principles of statutory interpretation. Its words should be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Federal Courts Act,Act, the object of the Act and the intention of ParliamentParliament.. Both the English and French versions of federal statutes are equally authoritative. Where the meaning of the words in the two officialofﬁcial versions differs, the task is to findﬁnd a meaning common to both versions that is consistent with the context of the legislation and the intent of ParliamentParliament.41.41

40. There is no doubt that the Federal Court’s jurisdiction derives from statute, but this does not operate to narrowly confineconﬁne the jurisdiction that statute grants.grants.4242 Because it is nourished both by provincial and federal legislation, the Court’s jurisdictionjurisdiction under s. 1919 of the Federal Courts Act is not limited to the confinesconﬁnes that would otherwise be associated with s. 101101 of the Constitution Act, 18671867.43.43 Issues addresseaddressedd under s. 1919 need no “substratum” of federal law. The Alberta and British Columbia legislatures have both asked this Court to exercise jurisdictionjurisdiction in order to authoritatively resolve “controversies” between their respective provinces,provinces, as has the ParliameParliamentnt of Canada. There is no basis for reading that narrowly.

41. If a legislature has given a tribunal jurisdictionjurisdiction over questions of law, it is presumed to have given that tribunal jurisdiction over constitutional questions as well.well.4444 The tribunal can provide whateverwhatever constitutional remedies the legislature intended would fitfit within its statutory mandate, which is determined by looking at its statutory mandate, structure and function.fi1nction. 45 There is no difference in this respect between remedies under s. 24 of the Charter and under s. 52 of the Constitution Act, 19821982,, the source of remedies for invalidity as a result of conflictconflict with the Constitution Act, 18671867.. 46

41 Schreiber v. Canada (Attorney General)General),, [2002][2002] 3 SCR 269, 2002 SCC 62, par. 5454.. 42 Canada (Human Rights Commission) v. Canadian Liberty Net,Net, [1998][1998] 11 SCR 626, par. 3535.. 43 43 Alberta v. Canada, par. 3434.. 44 R. v. ConwayConway,, [2010]r2010] 11 SCR 765, 2010 SCCscc 22 [[Conway],Conway], par. 81 45 Par. 8181.. 46 Par. 8080.. 15 --13- 13 -

42. While this framework can be applied to the Federal Court, it should be with the recognition that its “mandate, structure and function” is as a court, established under s. 101101 of the Constitution Act, 1867I 867,, as opposed to an executive branch tribunal. But at a higher level of abstraction, the same principles apply. The Federal Court clearly has authority to decide questions of law in general and constitutional law in particular to the extent they come up in the jurisdictionsjurisdictions granted to it under the Federal CoCourtsurts Act.

43. It has recently been held that the Federal Court can give an in rem declaration of invalidity in a matter otherwise within its jurisdictionjurisdiction under s. 18.18.4747 As Justice Martineau has pointed out, numerous cases in which the only relief sought were ddeclarationseclarations of invalidity were heard by the Federal Court or Federal Court of Appeal and then ultimately decided by the Supreme Court of Canada without any doubt about jurisdiction.48jurisdiction.48

44. To be sure, these were all cases involving federalfederal statutes, since —– outoutsideside the context of section 1919 disputes between provinces —– the statutes that the Federal Court will have the jurisdictionjurisdiction to answer questions of law about will be “laws of Canada” within the meaning of section 101101 of the Constitution Act, 18671867.49.49 But, as we have seen, this limit does not apply to s. 1919 since its source is from both levels of government. The key point is that a declaration of invalidity is the type of remedy that Parliament intended would fitﬁt within the Federal Courts Act,Act, as shown by the Federal Court’s status as a superior court of record.record.5050

45. Since section 1919 clearly creates a power to determine questions of law, and since there is also no genuine doubt that this includes constitutional questions, and since declarations of invaliditinvalidityy are remedies within the mandate, structure and functionﬁmction of the Federal Courts, there is no problem with an action for a declaration of invalidity, so long as the dispute is within section 19.19. The issue at stake on this application is therefore whether it is plain and obvious that the AG BC’s claim is not a “controversy” or ““cascas de litigelitige.”.”

47 Bilodeau-Massé,Bilodeau-Massé, par. 38-8838-88.. See also Deegan,Deegan, at par. 212-240212-240.. 48 Bilodeau-Massé, par. 6262.. In particular, Labatt v CanadaCanada,, [1980][1980] 11 SCR 914 (a federalism case), Egan v. CanadaCanada,, [1995][1995] 2 SCR 513 and Corbiere v. CanadaCanada,, [1999][1999] 2 SCR 203 (section 15)15) 49 ITITOO—International-International Terminal Operators Ltd. v. Miida Electronics Inc., [1986][1986] 11 SCR 752752,, p. 766. 50 Federal Courts Act, s. 44.. 16 --14- 14 -

C. The Ordinary Meaning of the French and English Text of Section 19 Includes Actions for Declaration of Invalidity

46. Since the determination of the Court’s jurisdictionjurisdiction to consider the AG BC’s action is a matter of statutory interpretation, we must begin with the “ordinary and grammatical”grammatica ” meaning of the words, as they are in both officialofﬁcial languages, and seek a common meaning.

47. As the Federal Court of Appeal has pointed out, the ordinary meaning of both “controversy” and ““litige”litige” suggests a broad scope.scope.5151 If the ordinary English speaker were asked whether there was a “controversy” over the “Turn Off the Taps Act” between British Columbia and Alberta, the only possible objection would be that this is an understatement.

48. With regard to the French word ““litige,”litige,” there are strong reasons to suggest that it includes cases involving declarations of invalidity. First, section 57(4) of the Federal Courts Act,Act, which concerns constitutional questions adjudicated in the Federal Courts, provides that “Le procureur général àa qui un avisaVis viséVisé aux paragraphes (1) oucu (3) est signifiésigniﬁé peut presenterprésenter une preuve et des observations àa la Cour d’appel fédérale ou àa la Cour fédérale et àa l’officel’ofﬁce fédéral en cause, àa l’égard de la question constitutionnelle en litige [emphasis[emphasis added].”

49. In Canada Post Corp. v. Lépine,Lépine, the Supreme Court stated, “[t]he term ‘dispute’‘dispute’ has a broad meaning that encompasses all types of legal proceedings (see Black’s Law Dictionary (8th ed. 2004), at p. 505; see also, regarding the term ““litige”litige” used in the French version of art. 3155(4),315514), H. Reid, Dictionnaire de droit québécoisque’be’cois et canadien (3rd ed. 2004), at p. 355; Le Grand Robert de la langue francaisefrançaise (2nd ed. enl. 2001), vol.V01. 4, at p. 864; Goldstein and Groffier,Grofﬁer, at p. 384).384).5252 ““LitigeLitige has been used to refer to cases in which a party seeks a declaration of invalidity under s. 52 of the Constitution Act, 1982 in a number of cases in QuébecQuebec.53.53

50. Interestingly, while the English word “controversy” has been used in the predecessors to section 1919 jurisdictionjurisdiction for the Exchequer Court since 1873,1873, the French word has changed, from

51 Alberta v. Canada, para. 2626.. “Controversy” does not include criminal matters. 52 2009 SCCsee 16,16, [2009][20091 11 SCR 549 par. 5454.. Emphasis added. 53 Descheneaux c. Procureure ge'néralegénérale du CanadaCanada,, 2017 QCCS 3645, par. 27 (““[c](““[c]eses principes s’appliquent mêmeméme si le1e litige porte sur la validité constitutionnelle d’une loi fédérale”); Gingras c. Procureur ge'néralgénéral du CanadaCanada,, 2018 QCCS 5647, par. 50 (“l]a(“1]a déclarationdeclaration d’invalidité d’une disposition législativelegislative ou règlementairereglementaire participe des deux notions dans la mesure où01‘1 son effet s’étend auau—dela-delà des parties au litige”). See also L'EcuverL'Écuyer c. CôtéCote,, 2013 QCCS 973, par. 149149 17 --15- 15 -

“contestations” in 18751875 to ““différends”différends” (still used in the heading) to variationsvariations on “litige” when the firstﬁrst Federal Court Act was passed.54passed.54 The common ground is that they are, as the Federal Court of Appeal has noted, very broad words with no suggestion of limiting constitutional use.

D. The Historical Context and Jurisprudence: “Controversies” Have Always Included Constitutional Questions

51. There is good historical reason for the use of a broad word like “controversies” and ““contestations”,contestations”, rather than more legalistic words like “claim” or “action.” The historic premise was that the Crown was both immune from suit (that is to say, from actions and judicialjudicial court proceedings into which other persons can be impleaded without their consent) and was indivisible, so that provincial and federal governments could not, properly speaking, litigate legal claims against each other. This was inconvenient because sometimes senior governments need authoritative resolution of their differences. Moreover, they needneededed authoritative resolution by a court not identifiedidentiﬁed with any particularparticular province and with territorial jurisdictionjurisdiction over both contending provinces. The words “controversies” and ““contestations”contestations” were chosen as a result and voluntary (at the will of the relevant provincial legislature) jurisdictionjurisdiction was given to a section 101101 court. 55

52. The AG Alberta’s argument that the “removal” jurisdiction of the Supreme Court of Canada under the 18751875 Act to establish the Supreme Court and a Court of Exchequer, a jurisdictionjurisdiction which continued until 1974,1974, implied that the Supreme Court of Canada had exclusive original jurisdiction over the constitutional validity of provincial and federal statutes. This is wrong and reflectsreﬂects a lack of understanding of the historical contextcontext..

53. As Professor Peter Russell explained in a 19681968 article, the Mackenzie government that introduced the 18751875 Act believed that Parliament’s power under s. 101101 of the Constitution Act, 1867 to provide for “a General Court of Appeal for Canada” and to establish “any additional Courts for the better Administration of the Laws of Canada” were exclusive and therefore a

545“ Canada v. Québec,Oue’bec, [2008][2008] 2 FCR 230, 2007 FC 826826,, par. 71, 7272.. 55 This history is described at length by Chief Justice JackettJackett in Canada v. Prince Edward Island (1977), 83 DLR (3d) 492 (FCA)(FCA),, pp. 504ff and with less patience by Esson CJBC in BritishBritish Columbia v. Canada (1989) 65 DLR (4(4th)th) 676 (BCSC), par. 9-11 [[ENRENR CaseCase].]. 18 --16- 16 -

General Court of Appeal could not also have any original jurisdictionjurisdiction whatsoever.56whatsoever.56 This was why the Exchequer Court was created, even though it was initially staffed by Supreme Court of Canada justicesjustices sitting alonalone.e. As Professor Russell pointed out, both the Conservative and Liberal governments of the 1870s1870s wanted to give the Supreme Court of Canada original jurisdictionjurisdiction over constitutional disputes between the federal and provincial governments and between provincial governments (subject, at the time, to appeals to the Privy Council), but they believed it to be constitutionally impossible.impossible.5757

54. The removal jurisdiction referred to by AG Alberta was neither original nor exclusive. Removal jurisdictionjurisdiction only arose when the Judge with jurisdictionjurisdiction over the underlying proceeding invoked it. It also applied only to “suits, actions or proceedings”, which, in the era of Crown immunity and indivisibility, would necessarily mean suits, actions and proceedings between subject and subject. It simply did not apply to any question arising in a “controversy” between the Dominion and a province or between provinces, for which the contemplated mechanism was a hearing before a Supreme Court of Canada justice acting as the Exchequer Court, followed by an appeal to the Court as a whole. The removal jurisdictionjurisdiction was, in practice, a failure, since judgesjudges did not invoke it. Russell was unable to findﬁnd a single example of an issue that reached the Supreme Court of Canada through the removal jurisdiction.58jurisdiction.58 Nor has the AG Alberta.

55. In any event, the idea that the removal jurisdictionjurisdiction should determine the interpretation of “controversy” and ““litige”litige” more than four decades after iitt was abolished makes no sense.

56. A failure to consider this historical bacbackgroundkground may also have led the AG Alberta to misunderstand the 19091909 Canada v. Ontario decision of the Supreme Court of Canada,Canada,5959 upheld by the Privy Council in 1910.1910.6060 That case did not findﬁnd that the jurisdictionjurisdiction over controversies was a limited one, and in particular did not say such controversies were private law claims under contract, trust or fiduciaryﬁduciary duties (such claims could not exist between emanations of the Crown

56 Debates of the House of Commons of0f the Dominion of Canada (Hansard) vol. 1 Session 1875,18 75, Hon. Mr. Foumier,Fournier, Minister of Justice, p. 285, AG BC Authorities, Tab 11;; Russell,Russell Peter H.. "The Jurisdiction of the Supreme Court of Canada: Present Policies anandd a Programme for Reform." Osgoode Hall Law Journal 6.1 (1968) :: 1-381-38 at p. 6. 57 Russell, p. 7. 58 Russell, p. 8, ftn. 20. 59 (1909), 42 SCR 11 606° [1909][1909] AC 637 (JCPC) 19 --17- 17 -

in nineteenth century understanding), or that the Exchequer Court was restricted to consequential, as opposed to declaratory relief, or that issues of constitutional law were beyond its scopescope.. On the contrary, on every one of these points, the case stands for the very opposite conclusion: the case was not a private law claim or indeed a strictly legal claim at all, the relief was properly declaratory, and the issues were constitutional. On all these points, the AG Alberta has simply misunderstood the case.

57. In the 18881888 St Catherines Milling decisiondecision,61,61 the Privy CounCouncilcil had determined that the Crown proprietary rights obtained as a result of the surrender of land in what became northwestern Ontario by the Ojibway people in Treaty No. 3 were for the benefitbenefit of the Crown in right of OntarioOntario,, although the expenditures to fulfillfulfill the Crown’s obligations under the treaty came from the federal treasurytreasury.. Lord Watson remarked, ““SeeingSeeing that the benebenefitfit of the surrender accrues to her, Ontario must, of course, relieve the Crown, and the Dominion, of all obligations involving the payment of money which were undertaken by Her Majesty, and which are said to have been in part fulfilledfillfilled by the Dominion.” But since the St Catherines Milling case came to the courts as an enforcement action by the Ontario Crown against a licensee claiming through the Crown in right of the Dominion,Dominion, it was agreed by all judgesjudges in the Canada v. Ontario case thatthat determining whether Ontario should compensate Canada was not within the scope of the jurisdictionjurisdiction exercised by the Privy Council and the remark was therefore an obiter dictumdictum..

58. Canada did not seek damages in the Exchequer Court. What Canada sought, and received at firstﬁrst instance, was a declaration that Ontario was liable to reimburse Canada for a share of the treaty money proportionate to the part of the surrendered land located in Ontario.Ontario.6262 This form of order was considered appropriate because of the principles of Crown immunity and indivisibilityindivisibility:: the Crown could not get consequential relief from itself.

59. The Supreme Court of Canada and the Privy Council did not question that ththee Exchequer Court had jurisdiction to make this orderorder.. Indeed, the majority in the Supreme Court of CanadCanadaa and Earl LoreburnLorebum for the Judicial Committee relied on this jurisdiction to dismiss Lord Watson’s remark as an obiter dictumdictum.. Justice Duff began his speech, “The ‘Exchequer‘Exchequer Court

61 St. Catherines Milling and Lumber Company v. Ontario, [1888][1888] UKPC 70. 62 (1909), 42 SCR 11,, p. 63. 20 --18- 18 -

Act’ confers upon that court jurisdictionjurisdiction to decide a controversy such as this.”this.”6363 Justice Idington agreed that the language of “controversy” was ““comprehensivecomprehensive enough to cover claims founded on some principles of honour, generosity or supposed natural justice”justice” and allowed the Exchequer Court to avoid ““thethe possible technical difficultydifﬁculty arising from each power representing or being represented by the same CrownCrown.”.”

60. While Justices Duff and Idington recognized that the jurisdictionjurisdiction over “controversies” went beyond technical legal disputes, they both insisted that the case should be determined on legal principles, indeed on common law principles as opposed to civil law ones. This was not about the scope of jurisdiction,jurisdiction, but about how that jurisdiction should be exercised. Earl LoreburnLorebum agreed with this, saying, “The Court of Exchequer, to which, by statutes both of the Dominion and the Province, a jurisdictionjurisdiction has been committed over controversies between them, did not thereby acquire authority to determine those controversies only according to its own Viewview of what in the circumstances might be thought fair.”fair.”6464 Of course, the AG BC is not suggesting that the Court should determine the merits on anything other than the law.

61. Contrary to the AG Alberta’s assertion, the courts in this case were well aware that the issues they were addressing did not arise in “contr“contractact or trust”trust”6565 and they certainly never suggested that the jurisdictionjurisdiction of the Exchequer Court over controversies/controversies/contestationscontestations was limited to legal rights in a technical sense, although the majority also said that in resolving those controversies, the Court should apply legal principles. In particular, the Exchequer Court was able to give declarations in a manner that was constitutional, although it did not involve the validity of legislation.legislation.6666

62. While it is implicit in the majority decision, the dissent of Justice Davies, shows specificallyspeciﬁcally that the claim was constitutional in nature.nature.6767 None of the judgesjudges considered that it lay

63 P. 118.118. 64 [1909][1909] AC 637 (JCPC) 65 As asserted quite mistakenly by the AG Alberta at par. 42 of its Memorandum. 66 Another constitutional case under the “controversy” jurisdictionjurisdiction of the Exchequer CouCourtrt was British Columbia. v. Canada, [1923][1923] 4 DLR 690 (JCPC(JCPC),), which dealt with whether bona vacantia were “royalties” under s. 109109 of the Constitution Act, 1867I867.. 67 (1909),g 1909 1, 42 SCR 11 at p. 67 (“That claim, as I understand it, is based upon the relative rights, obligations and duties given to and imposed upon the Dominion and the provinces respectively by the "British North America Act, 1867”)1867”) 21 --19- 19 -

beyond the jurisdictionjurisdiction of the Exchequer Court to entertain and dispose of such a claim simply because it involved the interpretation and application of the Constitution.

63. The AG Alberta also misunderstands the 19771977 Canada v. PEI case. The issue there was not whether a “controversy” included declaratory relief under the Constitution (which was common ground), but whether it could also include consequential relief in the form of damages. The Court found that the answer to the latter question was “no”, but then chose to read Prince Edward Island’s claim as for a declaration of entitlement to money under the Constitution. There was never aanyny doubt that declarations of violation of the Constitution were available.

64. The Prince Edward Island Terms of Union, which are now part of the “Constitution of Canada” as defineddeﬁned in s. 52 of the Constitution Act, 1867, and were, even before patriation, conconsideredsidered constitutional in nature,68nature,68 provided that Canada was responsible for assuming and defraying the cost of “Efficient“Efﬁcient Steam Service for the conveyance of malls and passengers” between Prince Edward Island and the mainland.”mainland.69 While Canada objected on the facts to the trial judge’sjudge’s declaration that a strike meant it had failed to live up to this obligation, it did not appear to dispute the trial judge’sjudge’s power so to declare. The more important issue was on the crosscross-appeal,-appeal, where the province objected to ththee trial judge’sjudge’s unwillingness to assess damages.

65. Chief Justice Jackett, allowing the cross appeal, did not dispute that on strict legal principles, no damages could be owing. But, he said, the British North America Act and the Terms of Union had created ““statutorystatutory duties” owed by and owing to “political entities”, which “cannot be described any more accurately, as I conceive them, than the peoples or public for the time being of the geographical areas involved”:

In effect, it is a claim by the people for tthehe time being of Prince Edward Island against the people for the time being of all Canada. In my view, it does not matter whether such parties are referred to in the proceedings by the geographical names or by reference to the executive Governments that represent the inhabitants of the geographical areas and that must be their spokesmen for the purposes of the dispute.dispute.7070

68 This is confirmedconﬁrmed by Justice Le DaiDainn Canada v. PEIPEI,, p. 532. 69 Canada v. PEIPEI, p. 495. 707° P. 514. 22 --20- 20 -

66. Chief Justice JackettJackett specificallyspeciﬁcally recognized that even if what is involved is money, the remedy is declaratory.declaratory.7171 Justice Le Dain agreed, doubting whether consequential relief in the strict sense would be available, although a declaration of an entitlement to money would be.be.7272

67. At p. 513, Justice Le Dain’s commented that ““[t]he[t]he term "controversy" is broad enough to encencompassompass any kind of legal right, obligation or liability that may exist between Governments or their strictly legal personipersonification.”ﬁcation.” In context, this was clearly not a question of private law rights between legal entities, but constitutional relationships between jurisdictions.jurisdictions.

The Constitution ooff Canada, of which the Order in Council admitting Prince Edward Island into the Union forms part, attributes rights and obligations to Canada and the Provinces as distinct entities, however these entities and their precise relationship to such rights and obligations should be characterized.

[…]Like[...]Like the Chief Justice, I am, with respect, of the opinion that neither the doctrine of the indivisibility of the Crown nor that of Crown immunity, whether procedural or substantive, should be an obstacle to a determination of interinter-- governmental liability under this provision, which clearly contemplates that Canada and the Provinces are to be treated in law as separate and equal entities for purposes of the determination of a controversy arising between them.

68. To be sure, the classic viewView that the Crown is “legally indivisible” was relaxed in the course of the twentieth century.century.7373 In the ENR case, Chief Justice Esson of the B.C.BC. Supreme Court concluded that the viewView that the Crown could not sue itself was anachronistic and therefore the jurisdictionjurisdiction under s. 1919 of the Federal Courts Act was concurrent with the authority of the s. 96 courts.courts.7474 But this does not change the broad meaning of “controversy”, or that it includes declaratordeclaratoryy and constitutional relief. Governments continued to use the s. 1919 jurisdictionjurisdiction to get authoritative and nationally-binding resolution to their constitutional controversies.controversies.7575

69. If we are not to consider tthehe question of the Exchequer CourtCourt’s’s jurisdicionjurisdicion

71 See footnote 37. 72 P. 533, Le Dain J. 73 Mitchell v. Peguis Indian Band, [1990][1990] 2 SCR 85, pp. 101-102,101-102, Dickson CJCCJC (dissenting, but not on this point) (“Divisibility of the Crown recognizes the fact of a division of legislative power and a parallel division of executive power”).power.”). 74 ENR CaseCase.. This viewView was implicitlimplicitlyy accepted by the Supreme Court of Canada on appeal. 75 Canada v. QuebecOuebec (Attorney General), 2008 FCA 201201;; QuébecOue’bec (Attorney General) v. Canada, [[2011]2011] 11 SCR 368, 2011 SCC 1111;; Alberta v. Canada, supra. 23 --21- 21 -

anachronistically, we should recognize that the superior courts of the provinces started giving declaratdeclarationsions of invalidity only in the 1920s.1920s. While the action for a declaration ultimately rests in the inherent powers of the Court, common law courts were for many years wary about exercising it.it.7676 Historically, two judicial policies seemed to effectively preventprevent the use of the declaration: first,ﬁrst, the discretion to refuse the declaration where other remedies were available, and second, the refusal to grant the declaration where no other relief was sought.sought.7777

70. The landmark decision of Dyson78Dyson78 signalled the awareness iinn the courts of the utility of the declaration as a remedy for contesting Crown actions. This proved of great value in Canada as a means of determining whether laws fell within federal or provincial powers; as well as a means of testing the conformity of llegislationegislation with the CharterCharter.. 79 Kent Roach, author of a leading text on constitutional remedies says, “The ability to declare that a statute is constitutionally invalid under either the federal division of powers of the Charter is now considered part of the inherent powers of the provincial superior courts and a fundamentalﬁlndamental feature of judicialjudicial review in Canada.”Canada.”8080

71. In 1970,1970, towards the very end of its existence, the Exchequer Court declared Part VI of the National Energy Board Act invalid.invalid.8181 The Federal Court, established in 19701970 as a ““aa superior court of record having civil and criminal jurisdiction”82jurisdiction”82 fairly quickly established the principle that it would grant an in rem declaration of invalidity where it was the appropriate remedy and where it otherwise had jurisdiction.83jurisdiction.83

E. The Continuing Purpose of Section 19 Fits Constitutional Controversies Particularly Well

72. Even if one original purpose of section 1919 - that of avoiding puzzles created by the

76 Kourtessis v. MNR.,M.N.R., [1993][1993] 2 SCR 53 (“(“Kourtessis”)Kourtessis”) at 85. 77 Ibid.Ibid. 78 Dyson v. Attorney-General,Attorney-General, [1911][1911] 11 KB.K.B. 410. 79 Kourtessis at 86. Early cases of actions for declarations of invalidity include Electrical Development Co. of Ontario v. Ontario (Attorney General) (1919), 47 DLR 1010 (PC)(PC);; R v. Tiny Separate-School Trustees (1926), 59 O.L.R. 95 (S.C.); Standard Sausage Co. v. Lee, [1934][1934] 11 DLR 706 (BCCA)gBCCA).. 80 Kent Roach, Constitutional Remedies in Canada, (looseleaf December 2012),2012), p. 2-19, AG BC Authorities, Tab 33.. 81 Caloil Inc. v. Attorney-General of Canada (No. 1),I), [1970][1970] Ex CR 512512.. 82 Federal Courts Act, s. 4 83 See discussion in Bilodeau-Massé.Bilodeau-Massé. 24 --22- 22 -

indivisibility of the Crown - may now be anachronistic, other objects may continue to support a broad interpretation of jurisdiction. When provinces dispute, especially when it goes beyond governments to populations, only the Federal Courts are truly separate from either of the disputants and only the Federal Courts have geographical jurisdictionjurisdiction in both of the contending provinces.

Thus, without section 1919 of the FFCC Act (and its previous versions), if a controversy arose between Alberta and Saskatchewan for example, it appears that either Provincial Crown could sue the other but before the defending’s provincial Crown’s courts.courts.8484

73. The object of the 19701970 Federal Court Act,Act, was twofold: first,ﬁrst, ensuring that members of the public would “have resort to a national court exercising a national jurisdictionjurisdiction when enforcinenforcingg a claim involving matters which frequently involve national elements”; and second, making it possible for “litigants who may often live in widely different parts of the country to [have][have] a common and convenient forum in which to enforce their legal rights.”85rights.”85 Section 1919 gives voluntary access to this CCourtourt exercising national jurisdiction to provinces that choose to invoke it in their controversies.

74. It is selfself-evident-evident that the most divisive controversies, the ones where an outside adjudicator is most useful, will be those where the peoplepeople of one province are angry at the people of another for their political decisions and their representatives respond with measures of questionable constitutionality. These are controversies for which the principle of federalism weighs in favour of the availability of a forum for authoritative resolution, and not in favour of its absence. In other words, the present claim is an example of when the interinter-provincial-provincial aspecaspectt of s. 1919 could be most useuseful.ﬁil. This certainly seems to have been Justice Hall’s approachapproach..

F. This Action Is About Legal Rights, Obligations and Liabilities That May Exist Between Governments

75. As we have seen, the reference to “rights, obligations and liabililiabilitiesties that may exist between governments” in Justice Le Dain’s reasons in PEI v. Canada was definitelydeﬁnitely not intended

8484Alberta Alberta v. CanadaCanada,, at par. 2929.. 85 House of Commons Debates,Debates, vol. V, 2nd Sess., 28th Parl., March 25, 1970,1970, p. 5473, AG BC Authorities, Tab 2 25 --23- 23 -

to be a narrow matter of private causes of action, but a broad one of constitutional rights and obligations between jurisdictionsjurisdictions and even the populations of various jurisdictions.

76. In any event, the AG Alberta’s assertion that the AG BC is “invoking the rights of the federal Crown” shows a fundamental misunderstanding of Canada’s constitutional order.

77. In the firstﬁrst place, the limitations on legislative power in Part VI of the Constitution Act, 1867 are not, and never have been, personal rights of the other level of government. If there is a correlative right to the obligation on legislatures not to enact unconstitutional laws, it is the right of all persons not to be subject to unlawunlawfulﬁil state power.

78. This can be seen by the fact that any person with standing can challenge a law on the grounds that it is outside the jurisdiction of the level of government that enacted it. While a common position advanced by the Attorneys General of both levels of government that a law is ...... 86 intramtra viresVires is1s entitledent1tled to some weight,welght, it1t is1s not determinative.determ1nat1ve. 86

79. As Chief Justice Jackett and Justice Le Dain recognized, the rights of populations must be represented by their governments. An Attorney General, as chief law officerofficer of the Crown, has standing to represent the proprietary and fiscalfiscal interests of the Crown in right of the jurisdictionjurisdiction of which he or she is an Attorney General.General.8787 So, for example, in Canadian Forest Products,Products, the Attorney General had the standing to pursue damages as compensation for loss of Crown property or Crown revenues.revenues.8888 But in addition, the Attorney General for each province, acting as the chief law officeofficerr of the Crown, has parensparens patriaepatriae standing to go to court to prevent or receive compensation for public nuisance “even if the perpetrator of the deeds complained of be a creature of” ananotherother sovereign.89 A “public nuisance” is a far broader term than a “private nuisance” and includes “any activity which unreasonably interferes with the public’s interest in

86 See cases at footnote 23. Even when both levels of government agree on a division-of-powersdivision-of—powers point, their agreement, while entitled to weight, is not determinative: OPSEUOPSEU v. Ontario (Attorney General)General),, [1987][1987] 2 S.C.R. 2, at pp. 19-2019-20 87 Craig E. Jones, “The Attorney General’s Standing to Seek Relief in the Public Interest: The Evolving Doctrine of Parens Patriae”Patriae” (2007) 86 Can. B. Rev. 121.121. 88 British ColumColumbiabia v. Canadian Forest Products Ltd.,Ltd., [2004][2004] 2 SCR 74, 2004 SCC 38 (“(“CanadianCanadian Forest Products”)Products”) para. 6363.. 89 People’sPeople's Holding Co. v. Attorney-General ofofOuebec, Quebec, [1931][1931] SCR 452452,, p. 458; Canadian Forest Products,Products, para. 66ff66ff.. 26 --24- 24 -

questions of health, safety, morality, comfort or convenience.”convenience.”9090 The remedies an AtAttorneytorney General can seek are broad, and would include injunctions and damages, as well as declaratory - 91 relief.rellef. 91

80. This parensparens patriaepatriae standing is distinct from “public interest” standing, which is granted to persons or organizations when that is a reasonable and effective way of getting a justiciable issue to court.court.9292 “Public interest” standing was developed as an alternative to the “relator” action in which an Attorney General delegated his or her right to sue for abatement of public nuisance.

81. In this case, the fiscalﬁscal and proprietary interests of the Crown in right of British Columbia are affected by the Act since a shock to petroleum product supplies would have adverse revenue and expenditure impacts on the British Columbia consolidated revenue. However, the mmainain point is that the Act would, on the facts as pleaded, interfere with the “comfort or convenience” of the public in British Columbia and potentially with its safety. British Columbians would be affected in their capacity as provincial residents, includiincludingng in their ability to engage in intraintra-provincial-provincial transportation, the operation of hospitals and the protection of provincial public resources.

82. In UltramarUltramar,,93 the Federal Court granted the Attorney General of Nova Scotia standing as a person “directly affected” within the meaning of s. 18.118.1 of the Federal Courts Act in a judicialjudicial review of decisions taken under the federal Competition Act. The interest on which the provincial Attorney General was given standing was the local public interest in gasoline prices. UltramarUltramar was relied on by the AG Alberta before the Federal Court of Appeal in challenging decisions of the Canada Wheat Board. The Court stated that the AG Alberta’s argument for standing “interesting,”“interesting,”9494 but decided the case based on the substantive principle that the decision in question was not one susceptible to judicial review.

83. The existence of what the American case law would call a ““quasi-sovereignquasi-sovereign ininterest”terest” is

90 Ryan v. VictoriaVictoria (City), [1999][1999] 11 S.C.R. 201, at para. 52 91 Canadian Forest Products, para. 6363.. 92 Downtown Eastside.Eastside. 93 Nova Scotia (Attorney General) v. UltramarUltramar Canada Inc.,Inc., [1995][1995] 3 FC 713 (T.DgT.D..)(“Ultramar)( “Ultramar””).). 94 Alberta v. Canada WheatWheat Board, [1998][1998] 2 FC 156156 (CA),(CA), paras. 10-1110-11.. See William R MacKay, Parens Patriae as a Basis for Provincial Standing in Judicial Review of Federal Decisions, (2008) 45:4 Alberta Law Review 961 for an extensive discussion. 27 --25- 25 - particularly strong in this case, because it involves constitutional provisions that limit the authority of provinces in order to protect the interests of other provinces. The Constitution itself has created a justiciablejusticiable interest (a “right”)“ri t”) ththatat is most logically vested in provincial and territorial governments.

84. Section 121121 of the Constitution Act,Act, 1867 provides that “[a]“[a]llll Articles of the Growth, Produce, or Manufacture of any one of the Provinces shall, from and after the Union, be admitted free into each of the other Provinces.” It is infringed by laws that “in essence and purpose” restrict trade across provincial boundaries, while leaving intact laws that incidentally affect trade as part of broader regulatory schemes.schemes.9595 This is above all a guarantee by each of the provinces to all of the others that they will not impose tariffs and tarifftariff-like-like measures on each other. Like any contract, each party gave up freedom of action to protect its overall interests, and each party (in this case, primarilyprimarily the provinces) gained correlative rights and obligations.

85. Section 121121 does not specificallyspeciﬁcally say in whom the right that it sets out is vested. Section 121121 can be invoked by an accused charged with unlawfully importing liquor into New Brunswick from QuebQuebecec as in ComeauComeau.. But the most logical party to have direct standing to bring declaratory relief in relation to section 121121 is the injured province or territory (the exporting province in the case of an import restriction or the importing province in the cacasese of an export restriction).

86. Section 121121 does not confer power, but limits the powers under both section 91 (federal) and 92 (provincial) of the Constitution Act, 18671867.96.96 While the Supreme Court of Canada in Comeau did not resolve the issue of whether federal laws could be challenged under s. 121,121, it noted that in previous cases the Court had proceeded on the basis this was possible and opined that the analysis might be different depending on whether the law that was challenged was federal or provincial.97provincial.97 It clearly is not limited to the AG Canada to vindicate.

87. Section 92A of the Constitution Act,Act, 1867 also, on its face, creates constitutionallyconstitutionally-- protected legal interests for “parts of Canada” —– provinces, territories or (perhaps) parts of provinces or territories. More specifically,speciﬁcally, s. 92A(2) provides that ““[i]n[i]n each province, the

95 R. v. ComeauComeau,, [2018][2018] 11 SCR 342 (“(“Comeau”),Comeau”), para. 106106.. 96 Ibid., para. 7272.. 97 Ibid., para. 116116.. 28 --26- 26 -

legislature may make laws in relation to the export from the province to another part of Canada of the primary production from non-renewablenon-renewable natural resources and forestry resources in the province and the production from facilities in the province for the generation of electrical energy, but such laws may not authorize or provide for discrimination in prices or in supplies exported to another part of Canada [emphasis added].”

88. Section 92A is a unique provision in that it was the only explicit change to the division- of-of—powerspowers in the 19821982 Constitution and the only time since Confederation that provincial powers were extended by constitutional amendment.amendment.9898 With the exception of denominational rights in s. 93 of the Constitution Act, 18671867,, it is also the only provision in Part VI (Distribution of LegLegislativeislative Powers) that conditions exercise of a legislative power on respect for the rights of others. But as with denominational rights, those conditions can be enforced by their intended benebeneficiaries:ﬁciaries: while this CouCourtrt need not determine how far the scope of that may be, it must at minimum include provincial governments representing the “parts of Canada” that allege they have been subject to discrimination.

89. Even if section 121121 and 92A(2) do not create rights, the principle of the rule of law creates a right in every person not to be adversely affected by an unconstitutional enactment. The principle of legality refers to two ideas: that state action should conform to the Constitution and statutory authority ((lexlex facetfacet regemregem)) and that there must be practical and effective ways to challenge the legality of state action.action.9999 To be sure, the law of standing considers countervailing factors to ensure that such challenges are reasonably efficient.efﬁcient. But that does not change the basicbasic point about the principle of legality, namely that everyone has a right to a government limited by law.

90. Despite the AG Alberta’s submissions, the Manitoba Egg Reference case in no way stands for the proposition that provinces cannot bring constitutional challenges against each other.100100 It is absolutely true that the case arose out of Manitoba’s dissatisfaction with the egg

98 J. Peter Meekison and Roy J. Romanow, “Western Advocacy and Section 92A of the Constitution,” in J. Peter MeekisonMeekison,, William D. Moull and Roy J. Romanow, The Origin and Meaning of Section 92A92A(Montreal:(Montreal: Institute for Research on Public Policy, 1985),1985), 15,15, AG BC Authorities,guthorities, TAB 3 99 100100 Manitoba (Attorney General) v. Manitoba Egg & Poultry Association, [1971][1971] SCR 689 29 --27- 27 -

marketing system at the time, a dissatisfaction whwhichich put it at odds with neighbouring provinces. While Chief Justice Laskin noted the lack of an evidentiary record in the Manitoba Egg Reference, he never suggested that the reference procedure was an illegitimate way to deal with constitutional controversies between provinces, let alone that there should be no such constitutional controversies —– a completely utopian prospect for anyone with any knowledge of Canadian history. The majority of the Supreme Court expressed no such qualms and ruruledled as Manitoba wanted them to.

G. The Action is Not Premature

91. The AG Alberta’s second argument for not reaching the merits is that it is “premature” to consider whether the Act is unconstitutional. Declaratory relief will generally not be granted when a dispute is hypothetical and may never arise. But this dispute has already arisen.

92. The Act is now in force. At this point, there can be no doubt that a constitutional dispute has arisen. It does not matter that the Lieutenant Governor in Council has not enacted regulations underunder the Act or that the Minister has not made an order under s. 2. The AG BC is not saying that particular regulations or orders under the Act will be unconstitutional. The AG BC is saying that the Act is right now unconstitutional. The validity of a statutstatutee is not controlled by the action or inaction of a Minister. A Minister cannot breathe life into an invalid statute by deciding for the time being to forbear from using the illegal powers that it puts at her disposal. ..

93. Right now the Act authorizes discrimination against a part of Canada in prices or supplies. Right now, the Act is in relation to products excluded from s. 92A by the Sixth Schedule. Right now, it constitutes a tariff-liketariff-like trade barrier to the movement of products across provincial boundaries,boundaries, contrary to s. 121.121. Or so the AG BC claims. The AG BC makes no claim of unconstitutionality of asas-yet-untaken-yet-untaken actions by the Lieutenant Governor in Council or the Minister.

94. Declarations of invalidity are frequently prospectiveprospective remedies.remedies.101101 The wholwholee point of such declarations is to give guidance for the future. Indeed, it is not uncommon for a declaration of invalidity to be suspended so that its prospective effect is delayed for a year or more from the date of judgment.judgment. A party —– for example an indindividualividual who has reason to believe they might need

101101 Hislop v. Canada (Attorney General), [2007][2007] 11 SCR 429, 2007 SCC 1010 (“(“Hislop”),Hislop”), para. 8282.. 303O --28- 28 -

to access medical assistance in dyingdying102102 —– with standing need not show that they will inevitably suffer from the unconstitutional law, so long as the declaration has utility. As was noted by Dickson J. (as he then was) in Operation Dismantle:Dismantle:

None of this is to deny the preventative role of the declaratory judgment.judgment. As Madame Justice Wilson points out in her judgment, Borchard, Declaratory Judgments (2nd ed. 1941),1941), at p. 27, states that,

...no...no "injury" or "wro"wrong"ng" need have been actually committed or threatened in order to enable the plaintiff to invoke the judicialjudicial process; he need merely show that some legal interest or right of his has been placed in jeopardyjeopardy or grave uncertainty...103uncertainty....103

95. To be sure, a declaratiodeclarationn will not issue on ““meremere hypothetical” consequences. As the Court in Operation Dismantle put it, “there must be a cognizable threat to a legal interest before the courts will entertain the use of its process as a preventive measure.measure.””104104 But the AGBC in this case does not rely on hypotheses: it relies on the words of the Premiers and Ministers of Energy of two successive Alberta governments given on occasions of great solemnity and weight, on the structure of the Western Canadian fuelﬁlel indindustryustry and fullyﬁllly expects to obtain more evidence of the “cognizable” threat to British Columbia’s right not to have trade in fuels disrupted for discriminatory reasons.

96. The utility of a declaration is clear. Alberta has, in the words of its own elected offiofﬁcials,cials, “loaded” a “weapon” aimed at the people of British Columbia. We do not know how long it would, in practice, take to pull the trigger. But we do know no resident of British Columbia is entitled to notice or a hearing or “consultation” before the trigger is pulled. There is no existing statutory process in which the decision to pull could be challenged. The evidence is that a credible announcement would have immediate effect on the people of British Columbia.

97. In any event, the very factfact that unconstitutional laws are being used in interinter-provincial-provincial negotiations is itself unconstitutional. Importing jurisdictionsjurisdictions are inherently vulnerable to politically-motivatedpolitically-motivated threats of cutting off fuel supplies. They therefore have a choice of taking costly measures to ensure fuel security or letting the market function, relying on legal

102102 Carter v. Canada (Attorney General), [2015][2015] 11 SCR 331, 2015 SCC 55.. 103103 Operation Dismantle v. The Queen, [1985][1985] 11 SCR 441 (“(“OperationOperation Dismantle”),Dismantle”), para. 32. 104104 Ibid., para. 3333.. 31 --29- 29 -

guarantees. If they make the latter choice, this of course benebenefitsﬁts exporting jurisdictions.

98. The AG BC will argue that section 92A(2) forbade laws that “authorize” discrimination preciselyprecisely to protect importing provinces from attempts to use the threat of an embargo to extract concessions. The Western Premiers of the day were content to reassure them that they had justiciablejusticiable protection from such a threat, and that protection was written into the highest law. The exporting provinces in effect benebenefitedﬁted from this assurance because it kept the importing provinces from seeking energy security elsewhere. If this assurance is not real, it would be of utility to everyone to know this before an actual disruption of supply takes place.

99. The AG Alberta says we should not presume that the Minister of Energy will act unconstitutionally. But this begs the question, since the AG Alberta has not conceded that the Minister of Energy would be acting unconstitutionallyunconstitutionally if she used the Act to punish British Columbians for positions taken by their provincial government. In the absence of an authoritative ruling by the courts, she would likely be able to take advantage of the limited immunity doctrine in Mackin.Mackin. 105105 If there were a declaration, and she acted anyway, then she would indeed be liable for damages.106106 This shows precisely why a declaration would be useful.

100.100. The parts of the Statement of Claim to which the AG Alberta objects show, in the AG BC’s submissisubmission,on, that the Act authorizes discrimination. The AG Alberta completely reads out of section 92A(2) the word “authorize.” Since there has never been any judicialjudicial decision or even commentary on this section, this is premature. The AG BC’s case should only be struck if it is plainly and obviously doomed to fail.

101.101. If the AG BC cannot make out unconstitutionality on the facts as they currently exist —– without reference to asas-yet-unenacted-yet-unenacted regulations or asas-yet—unordered-yet-unordered orders —– then the AG BC will lose. But that is an issue for the merits. At this stage, it justjust asks for its day in court.

105105 Mackin v. New Brunswick (Minister of Finance); Rice v. New Brunswick, [2002][2002] 11 SCR 405, 2002 SCC 1313,, para. 7878.. Even in this case, the action for damages would be directed at officialsofﬁcials acting under the law, not the Legislature itself, and would therefore be a separate action. 106“’6 Holland v. Saskatchewan, [2008][2008] 2 SCR 551, 2008 SCCscc 42 32 -30-- 30 -

PART IVIV-ORDERS— ORDERS SOUGHT

102. On the basis of the forgoing, the AG BC asks that the application be dismissed with costs.

ALL OF WHICH IS RESPECTFULLY SUBMITTED this 1111h h day of September, 2019. %;2: J. GérethG~ Mbﬁey and RobertertDanayDanay Counsel for the Plaintiff, Attorney General of British Columbia 33 --31- 31 -

PART V —– LIST OF AUTHORITIES 1...... Hansard —_Paragraph No. Debates of the House of Commons of the Dominion of Canada (Hansard) 53 vol. 1 Session 1875,I 8 75, Hon. Mr. Fournier, Minister of Justice, p. 285, House of Commons Debates,Debates, vol. V, 2nd Sess., 28th Parl., March 25, 1970,1970, 73 p. 5473 EecondarySecondary Authorities ﬂan-1-Paragraph No. Kent Roach, Constitutional Remedies in Canada, (looseleaf December 70 2012)2012),, p. 2-19 .. Peter Meekison and Roy J. Romanow, “Western Advocacy and Section 88 92A of the Constitution,” in J. Peter Meekison,Meekison, William D. Moull and Roy J. Romanow, The Origin and Meaning of Section 92A92A(Montreal:(Montreal: Institute for Research on Public Policy, 1985),1985), 11