Henry Bos vs. Chicken Farmers of Ontario (CFO)

In the matter of Section 16 of the Ministry of Agriculture, Food and Rural Affairs Act, R.S.O. 1990 Chapter M. 16, as amended.

And in the matter of: An appeal to the Agriculture, Food and Rural Affairs Appeal Tribunal by Henry Bos, Stevensville, Ontario, from a decision of the Chicken Farmers of Ontario declining his request for the revocation of Chicken Farmers of Ontario Regulation 2274-2009.

And in the matter of: A Pre-hearing Conference pursuant to Rule 24 of the Tribunal's Rules of Procedure, to be held for the purpose of considering:

1. The statements of issues filed by the parties and the scope of issue(s) to be considered by the Tribunal in the hearing of the matter;
2. the identification of facts or evidence that may be agreed upon; and
3. any other matters which may assist in the just and most expeditious disposition of the appeal.
   

Before:
John O'Kane, Vice Chair; Kirk Walstedt, Chair; Tim Mousseau, Member

Appearances:
Henry Bos, appellant
Geoff Spurr, counsel for the respondent

Pre-Hearing Conference Decision of the Tribunal

The Tribunal held a pre-hearing conference in this matter on May 28th, 2010.

The primary purpose of the pre-hearing conference was to consider the statements of issues filed by the appellant Henry Bos and the respondent Chicken Farmers of Ontario (CFO), and to determine the scope of this appeal. In a previous pre-hearing conference decision, the Tribunal ordered the parties to exchange and file statements of issues.

The Positions of the Parties:

Issue No. 1

Mr. Bos challenged CFO regulation 2274-2009 as "ultra vires". Mr. Bos' statement of issues appeared to raise the "vires" of the regulation in an administrative law context and also in a constitutional context.

The Issue No. 1 remedies that Mr. Bos seeks in his statement of issues are the revocation of regulation 2274-2009 and the revocation of policy 175-2009.

Mr. Bos asserted that there is a close link between regulation 2274-2009 and CFO policy 175-2009.

CFO asserted that policy 175-2009 is not so closely linked to regulation 2274-2009. CFO also asserted that Mr. Bos had not followed section 16(5) of the Ministry of Agriculture, Food and Rural Affairs Act (MAFRA Act) as Mr. Bos had not raised his challenge to policy 175-2009 before CFO first in an application under section 17 of the MAFRA Act. As a result, CFO asserted that the challenge to policy 175-2009 is not properly before the Tribunal.

Issue No. 2

Mr. Bos raised much broader policy based issues related to the CFO's quota allocation policy and assurance of supply policy. He asserted that the quota allocation policy does not allow for differential growth among primary processors and it restricts a producer's ability to move product freely between Ontario processors. In respect of CFO's assurance of supply policy, Mr. Bos challenges the authority of the CFO to issue supply allocation orders and questions whether such orders conflict with Federal licensing regulations.

The Issue No. 2 remedies that Mr. Bos seeks in his statement of issues are the return to the allocation approach derived from a 2002 decision of this Tribunal, and a requirement that allocations to processors function on the basis of open contracting between producers and processors.

CFO asserted that Mr. Bos had not followed section 16(5) of the MAFRA Act as he had not raised his challenge to the policies before CFO first in an application under section 17 of the MAFRA Act. As a result, CFO asserted that the challenge to the policies is not properly before the Tribunal.

The Constitutional Issue

Anticipating the constitutional issue, the Panel asked Tribunal Legal Counsel to participate in the pre-hearing conference to explain to Mr. Bos that constitutional questions require notice to the Attorneys General for Canada and Ontario under the Tribunal's Rule 27 and section 109 of the Courts of Justice Act.

Since Mr. Bos was unaware of the requirements for notice of constitutional questions the Tribunal suggested that he might wish to consider seeking legal advice to assist with that aspect of his appeal. Mr. Bos indicated he would like some time to consider how to proceed.

The Tribunal directs that prior to the next scheduled pre-hearing conference, Mr. Bos confirm in writing to the Tribunal office with a copy to counsel for CFO if he intends to pursue the constitutional "vires" question and whether it relates only to regulation 2274-2009 or if it extends to any of the broader policy issues.

If Mr. Bos elects to pursue that part of Issue No. 1, it will then be up to him to ensure that he delivers the appropriate notices in accordance with the Tribunal's Rules and the Courts of Justice Act.

The Policy Challenge Issues

The Province of Ontario delegated the authority and responsibility to regulate the chicken production and marketing industry to CFO. Additionally, the Federal Government delegated certain administrative authority and responsibility to CFO. CFO wears a number of "hats" that include that of policy maker and regulator.

The CFO's policies, regulations, decisions, directions and orders are subject to appeal to this Tribunal under section 16 of the MAFRA Act. The legislation gives the Tribunal broad power on such appeals including the power to substitute its opinion for that of CFO.

Mr. Bos's appeal asks the Tribunal to use those broad powers to revoke or change several CFO policies related to quota allocations and processor control mechanisms.

In our review of the material Mr. Bos submitted to CFO on his application under section 17(1) of the MAFRA Act about CFO regulation 2274-2009, it is apparent that these questions about the broader policies were not in issue and, therefore, not considered by the CFO.

In the context of an appeal about a CFO regulation, the legislation gives the Tribunal the power to effect changes to related CFO policy in an appropriate case; however, on the facts before us, the Tribunal is concerned about doing so in this case.

The facts that concern us include:

• The material Mr. Bos submitted to CFO on his application under section 17(1) of the MAFRA Act did not raise the broader policy issues and, therefore, those were not considered by the CFO.
• While we have competing submissions about the relationship between regulation 2274-2009 and the various policies, other than a copy of policy 175-2009, we have no evidence or context about those various policies and how they relate to the regulation under appeal. Accordingly, a full hearing may be necessary for us to make a considered determination about the relationship, if any, between the regulation and the policies.
• While the legislation gives the Tribunal jurisdiction to make decisions about CFO policy, including the power to direct policy and to substitute our own decision for that of CFO, we are an adjudicative tribunal that uses an adversarial system model. We recognize that within that context the Tribunal has a policy making power; however, given the adversarial nature of appeals, it is a relatively blunt policy making instrument.
• Mr. Bos confirmed during the pre-hearing conference that he is willing to apply to the CFO for a hearing on the policies under section 17(1) of the MAFRA Act.
• In September 2009, the Farm Products Council of Canada urged industry stakeholders including the CFO, to work collaboratively in devising and implementing strategies to address the interprovincial movement of live chicken.
• Since September 2009, the CFO in an exercise of its policy making mandate has been pursuing industry stakeholder consultations about some, but not all of the policy aspects in dispute.
• Mr. Bos' appeal to the Tribunal is at the initial stage and he requires some time to consider and crystallize his position on the constitutional issue.

In light of the facts of this case, it would be premature for the Tribunal to consider the broader policy issues in the context of Mr. Bos' appeal of regulation 2274-2009, without first affording Mr. Bos and CFO an opportunity to address those issues in a section 17(1) application. As noted above, Mr. Bos is prepared to make that application. Additionally, Mr. Spurr, on behalf of CFO, confirmed, in response to questions from the Tribunal that he saw no timing issues that would prevent Mr. Bos challenging those policies in a CFO hearing.

However, it remains open for CFO and Mr. Bos to waive their respective rights to a section 17(1) hearing about those broader policy issues, pursuant to section 16(5)(b) of the MAFRA Act.

The Tribunal will hold Mr. Bos' appeal of regulation 2274-2009 in abeyance pending either the outcome of his application, if any, to CFO under section 17(1) of the MAFRA Act about the broader policy issues or until further order of the Tribunal.
In the event of an appeal by Mr. Bos from an unfavourable CFO decision about those broader policy issues, that appeal will be joined together with Mr. Bos' appeal of regulation 2274-2009.

Subject to a further Order of the Tribunal Chair, the current Tribunal panel will remain seized of these matters.

Order of the Tribunal

Therefore, the Tribunal Orders:

1. A further telephone pre-hearing conference in this matter will be held on Tuesday, July 8th, 2010 at 3:00 p.m. to hear a report from the parties about the constitutional issue and any application under section 17(1) of the MAFRA Act on the broader policy issues.
2. Prior to the next pre-hearing conference, Mr. Bos will confirm in writing to the Tribunal office with a copy to counsel for CFO if he intends to pursue the constitutional "vires" question.
3. In the event Mr. Bos elects to proceed with his challenge of the broader policy issues, Mr. Bos will apply to CFO under section 17(1) of the MAFRA Act about the broader policy issues.
4. In the event of an appeal by Mr. Bos from CFO's decision on the broader policy issues, if any, or if there is no decision from the CFO within sixty days of Mr. Bos applying for a hearing, or if the parties waive their rights to a hearing and Mr. Bos proceeds with an appeal to the Tribunal, that appeal will be joined together with Mr. Bos' appeal of regulation 2274-2009.
5. Subject to a further Order of the Tribunal Chair, the current Tribunal panel will remain seized of these matters.

Dated at Brampton, Ontario this 8th day of June, 2010.