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The Board of Transport Commissioners as an Administrative Body
Published online by Cambridge University Press: 07 November 2014
Extract
The great expansion of governmental activities into social and economic affairs during the last few decades has led to an enormous increase in the amount of “delegated legislation” or “administrative law.” The necessity for such delegation and the dangers to individual liberty which it involves have been fully explained elsewhere. It is the purpose of this article to discuss these problems in so far as the Board of Transport Commissioners is concerned. Known for thirty-four years after its inception in 1904 as the Board of Railway Commissioners, this body is not only the oldest but by far the most important administrative board in Canada. A study of its powers and performance should reveal the strengths and dangers of this type of administrative authority.
The chief function of the Board is to control steam railways under the jurisdiction of the Dominion government including those which, according to the terms of the B.N.A. Act, have been declared to be “works for the public advantage of Canada.” All other railways come under the Board where their connections with, or their crossing of, a Dominion railway is concerned and with respect of navigable waters. The Board also controls the rates charged by certain telegraph, telephone, and marine cable companies and the tolls of express companies and international bridges. It has authority to license ships operating between certain ports of Canada including control of their rates, and from 1938 to 1944 it supervised transport by air. Where water-power has been acquired under lease from the Crown, the Board may fix the quantity to be developed and the price to be paid in case of dispute. Authority for every order of the Board must be found in the Railway Act as amended. The Board is limited by certain Special Acts notably the Crow's Nest Pass Agreement, as amended, and the Maritime Freight Rates Act.
- Type
- Articles
- Information
- Canadian Journal of Economics and Political Science/Revue canadienne de economiques et science politique , Volume 11 , Issue 3 , August 1945 , pp. 342 - 358
- Copyright
- Copyright © Canadian Political Science Association 1945
References
1 Allen, C. K., Bureaucracy Triumphant (Oxford, 1931)Google Scholar; Corry, J. A., “Administrative Law in Canada” (Proceedings of the Canadian Political Science Association, 1933, pp. 190–207)Google Scholar; Hewart, G. H., The New Despotism (London, 1929)Google Scholar; Jennings, W. I., The Law and the Constitution (London, 1938), chap, VGoogle Scholar; Principles of Local Government Law (London, 1939), Appendix 1Google Scholar; Keith, A. B., The Constitution of England (London, 1940), vol. II, chap, XIXGoogle Scholar; Kennedy, W. P. M., The Constitution of Canada (Toronto, 1938), pp. 461–83Google Scholar; Landis, J. M., The Administrative Process (New Haven, 1938)Google Scholar; Report of the Committee on Ministers' Powers (Cmd. 4060/1932, H. M. Stationery Office); Willis, J., Canadian Boards at Work (Toronto, 1942).Google Scholar
2 Revised Statutes of Canada, 1927, c. 170; 18-19 Geo. V (1928), c. 43; 19-20 Geo. V (1929), c. 54; 20-21 Geo. V (1930), c. 36; 23-24 Geo. V (1933), c. 47; 2 Geo. VI (1938), c. 12, 40, 53; and 8 Geo. VI (1944), c. 28.
3 Now incorporated in s. 325, s.s. 5 and 6 of the Railway Act.
4 17 Geo. V (1927), c. 44.
5 “To be inveterate in error may be necessary for the House of Lords [as a court of appeal] but it is undesirable to adopt that precedent for ministerial disposition” ( Keith, , The Constitution of England, p. 238 Google Scholar).
6 Though not bound by precedent the Board quotes its own previous decisions liberally and often refers to parallel rulings in Great Britain and the United States. The Board like all government officials “must act within a prescribed framework and must frequently be as ready as the judge to justify its particular decisions with learned opinions, as well as opinions not so learned addressed to a wider audience” ( Isaacs, N., “The Logic of Public and Privarte Administration” in McNair, M. P. and Lewis, H. T., Business and Modern Society, Cambridge, 1938, p. 66 Google Scholar).
7 J. B. Eastman, quoted in Glaeser, M. G., “The Valuation Doctrine at the Crossroads” (Journal of Land and Public Utility Economics, 1927, p. 251).Google Scholar
8 E.g. Newfoundland Railway v. Canadian National Railway, (1942) 55 C.R.T.C. 381
9 The Board prescribes standard farms of bills of lading and may, in case of dispute, declare what the correct rate is, but legal action for infringement of contracts or for the recovery of illegal charges must be taken in the regular courts.
10 Except running rights over lines and such disputes as may be referred to it under the Canadian National-Canadian Pacific Act of 1933. See Currie, A. W., “The Senate Committee on Railways” (Canadian Journal of Economics and Political Science, 02, 1939, p. 58).Google Scholar
11 It is also possible to apply to the Board to rescind, review, or vary any order made by it or re-hear any application before deciding it. In at least one instance the Board reversed itself on re-hearing ((1937) S.C.R. 451). An application for re-hearing on one case may not be used as a threat over the heads of those who might apply to the Board on other cases ((1930) S.C.R. 288).
12 Unlike the Federal Trade Commission or the ill-fated Board of Commerce, the Transport Board does not issue “cease and desist orders” which, if the alleged violator of the Act does not obey them, have to be fought through the courts ab initio. Instead, any decision or order of the Transport Board may be made an order of the Exchequer Court or of the superior court of any province by a very simple procedure. Also any order of the Board shall, when published for three weeks in the Canada Gasette and while it remains in force, have the like effect as if incorporated in the Act. An appeal from the Board's decision is a case between two private litigants not one against the Board itself. Legally the Board is entitled to be heard by counsel or otherwise upon the argument of any appeal but this is not customary though there have been exceptions. The secretary of the Board goes to appeal hearings as custodian of the Board's records and the Board's counsel is heard when, of its own volition it refers a matter to the Supreme Court for an opinion thereon. Note the advantage of having an immediate appeal to the highest court in Canada instead of the dilatory and expensive process of appealing progressively from the lowest court to the highest.
13 (1939) S.C.R. 316.
14 (1943) S.C.R. 333.
15 Alberta, Saskatchewan and Manitoba v. Canadian Pacific Railway (1925) S.C.R. 155.
16 The decision of the court is reprinted in the Board's report for 1910.
17 Canadian Pacific Railway v. Toronto Transportation Commission (1930) A. C. 686; Corporation of City of Windsor v. Corporation of Town of Walkerville, (1933) S.C.R. 341; Corporation of City of Toronto v. Corporation of Village of Forest Hill, et al., (1932) S.C.R. 602.
18 (1928) S.G.R. 106, (1933) S.C.R. 423, and (1936) S.C.R. 271.
19 British Columbia Electric Railway v. Canadian National Railway, (1932) S.C.R. 161; Montreal v. Montreal Street Railway, (1912) A.C. 333.
20 Canadian Northern Railway v. Taylor, (1913) 4 W.W.R. 416.
21 Alberta v. Canadian Pacific and Canadian National Railway, (1931) S.C.R. 656.
22 S. 52 (10b).
23 Colebourne v. Harrop, 29 O.W.N. 477. See also Duthie v. Grand Trunk Railway, (1904) 4 C.R.C. 304; Alberta v. Canadian Pacific and Canadian National Railway, (1931) S.C.R. 656; Ottawa Electric Railway v. Nepean, 60 S.C.R. 216; Canadian National Railway v. Bell Telephone et al., (1939) S.C.R. 315. Even the Board's predecessor, the Railway Committee of the Cabinet, had a somewhat similar privileged position. “There being special legislation on the subject and a special tribunal constituted having powers. … I cannot see thait this is a proper case in which to aslc this court for a declaration of right … and I am of the opinion that it would not be a proper thing for the Court to declare generally the rights or priorities of the parties and I think that the action should be dismissed” (Grand Trunk Railway v. Toronto, (1900) 32 O.R. 120).
24 Canadian Pacific Railway v. Toronto Transportation Commission, (1930) A.C. 686.
25 Manitoba and Saskatchewan v. Railway Association of Canada, (1920) 26 C.R.C. 147 (P. C. Can.).
26 Re Railway Freight Rates, (1933) 40 C.R.C. 971 (P.C. Can.).
27 Employees of Michigan Central Railway v. Michigan Central Railway, (1933) 3 D.L.R. 71.
28 Montreal Street Railway v. Montreal Terminal Railway, (1905) 35 S.C.R. 478.
29 Halifax Board of Trade v. Grand Trunk Railway, (1911) 44 S.C.R. 298.
30 Williams v. Grand Trunk Railway, (1905) 36 S.C.R. 321.
31 For example, whether charges on wharfs owned by railway companies come within the powers of the Board ((1931) S.C.R. 431). But the court will not lay down any rule restricting the administrative function vested in the Board ((1943) S.C.R. 333).
32 Keith, , The Constitution of England, pp. 235–6.Google Scholar
33 Anyone who has read evidence before the Canadian Board and then referred to the record in similar cases before the Interstate Commerce Commission is at once struck by two facts: the counsel are less skilled in railway matters in Canada than in the United States and the factual data are less complete. Perhaps this is because the ICC has its own technical bar.
34 But see Bell Telephone Company v. Canadian National Railway, at p. 240, (1933) S.C.R. 222.
35 Refer to Lord Haldane in the famous Board of Education v. Rice case, (1911) A.C. 179.
36 In 1939 one M.P. stated that one of the Commissioners “has disappointed us in the discharge of the trust reposed in him” (Canada, House of Commons Debates, p. 4767). Both the Minister of Transport and a former Minister of Trade and Commerce protested vigorously against what they claimed was an attempt to intimidate a person holding public office. In the early nineteen-twenties Chief Commissioner Carvell was frequently upbraided in the House. The criticisms of the House have overcome stagnation in the Commission's affairs.
37 Through an oversight, no report was required in the original Act. The first report was not submitted until May, 1905, and was not printed with Sessional Papers.
38 In the original Act Commissioners were removable by the Cabinet for cause. It was explained that this was done because it was too cumbrous a preceding to have a vote of both Houses. The present regulation was introduced to protect Chief Commissioner Killam who was formerly a judge and in 1919 was applied to all Commissioners.
39 Canada, House of Commons Debates, 1921, pp. 2029–30.Google Scholar
40 Currie, A. W., “Freight Rates on Grain in Western Canada” (Canadian Historical Review, 03, 1940, p. 47).Google Scholar
41 Ibid., pp. 52-3.
42 One of these was formerly provincial Premier, five were Cabinet Ministers, two represented labour, two were farmers, one a president of the Ontario Agricultural College, and several were lawyers. Dr. S. J. McLean who was on the Board from 1908 to 1938 latterly as Assistant Chief Commissioner brought a great background of knowledge in transportation matters, a judicial temperament, and an appreciation of the economic and social significance of what the Board was trying to do. Two men were appointed to the Board but did not take part in its work—Thomas Greenway, ex-Premier of Manitoba who died in 1908 a few days after he arrived in Ottawa, and a lumber merchant from Vancouver who resigned in 1938 a short time after taking office.
43 The regional pressure is not new. In 1909 the House passed a resolution requiring the government to appoint “the most capable man available who is acquainted with western railway problems.”
44 The Act has several times been changed to attract or hold first-class men. In 1905 the tenure of the Chief Commissioner was changed to secure the services of Mr. Killam; in 1912 the salary of the Chief was increased to make it roughly equal to that of Supreme Court Justices; in 1919 it was altered to make Dr. McLean eligible for the Chief or Assistant Chief Commissionership; and in 1939 the Judges Act was amended to benefit men who might leave the Bench for the Commission. Because Commissioners ocoupy positions analogous to those of judges, they may come to feel that their functions are confined to dealing only with such cases as are brought beiore them by carriers or shippers. There is a definite temptation for the Boaird to become inert unless proded into action by the Chief Commissioner. The fact that the Board had eight Chief Commissioners in the first thirty-five years of its existence has handicapped it in carrying out a long-term policy.
45 For example, Jackman, W. T., Economic Principles of Transportation (Toronto, 1935), pp. 659–61.Google Scholar
46 For example on line abandonment the law reads simply a railway “Company may abandon the operation of any line of railway with the approval of the Board, and no company shall abandon … without such approval” (s. 165A (1933)).
47 But see The Canadian Electrical Association v. Canadian National Railway, (1932) S.C.R. 251, and the innumerable disputes chiefly relating to farmers' crossings and drainage in Macmurchy, A. and Denison, S., Railway Law in Canada (Toronto, 1922), passim.Google Scholar
48 Lefroy, A. H. F., Canada's Federal System (Toronto, 1898), pp. 339–452.Google Scholar
49 This is necessary if railways are to be operated efficiently. For example, if every municipality had unrestrioted power to pass by-laws regulating speed, the operation of fast trains would be impossible.
50 New York Central Railway v. Stormont, (1939) 50 C.R.T.C. 235; Canadian National Railway v. Wingham, (1941) 52 C.R.T.C. 261; Wallace v. Canadian National Railway, (1936) O.W.N. 431. The argument that branches of the old Intercolonial Railway are exempt from the Board's control over abandonment because they were built as required in the B.N.A. Act is not valid (Canadian National Railway v. King's and St. John Counties, (1940) 51 C.R.T.C. 52).
51 Annual Report, Canada Sessional Papers, 20 c, 1909, p. 30.Google Scholar Compare this caution with the frenzy and arbitrariness of the Board of Commerce as outlined in the Canadian Annual Review. Sensational rulings provoked antagonisms and within a few months, even before its functions were declared ultra vires, it disintegrated in disgrace.
52 Ibid., 1914, p. 98.
53 Determining the rate level to meet the needs of a high-cast road without giving excessive profits to its low-cost competitor or basing it on the requirements of the more economical line and perhaps bankrupting its rival was a thorny problem during the last war (Jackman, Economic Principles of Transportation, chap. VIII). The problem was decided by an Order-in-Council of 1920 directing the Board “to determine what are fair and reasonable rates without taking into account at all … the requirements of the Canadian National System.” The Board need not concern itself directly with the general level as long as the public is willing to pay any deficits on the Canadian National and the existing level is high enough to keep the Canadian Pacific out of bankruptcy.
54 In drawing up regulations governing the carriage of explosives the Board had to decide the methods of packaging necessary to protect persons and property. If it decided on certain rules, British and American exporters would be virtually debarred from the Canadian market. What amounted to a problem in tariff protection was fought out before the Transport Board in terms of safety precautions.
55 Swanson, W. W., Road, Rail and River (Toronto, 1937), pp. 61–2.Google Scholar
56 The Canadian National attempted to prevent the Canadian Pacific from building a duplicating line but the Supreme Court ruled that the latter was within its rights ((1929) S.C.R. 135).
57 Delegation goes even beyond the Board. Any railway company may make by-laws respecting speed, time tables, nuisances, travelling upon the railway, and the conduct of officers and employees. For the better enforcing of the by-law and after approval by the Governor-in-Council, the company may prescribe penalties not exceeding $40.00. The compamy may summarily interfere, using reasonable force if necessary, whenever the violation of the by-law is attended with danger or annoyance to the public (ss. 290-7).
58 In 1888 a Royal Commission headed by Sir A. T. Galt rejected the proposal for a Railway Commission on two grounds. The wiser policy would be to benefit by the experience of Britain and the United States with their Boards rather than to venture on our own experiments. Also, because a Railway Tribunal is necessarily tentative, it is not desirable to remove its operation in its inception beyond the direct criticism and control of Parliament and ministerial responsibility for it ( Canada, Sessional Papers, 8a, 1888 Google Scholar). The Railway Committee of the Cabinet established as a result of Galt's recommendation was replaced by the Board of Railway Commissioners in 1904 in consequence of two reports by Dr. McLean (ibid., 20a, 1902). The Committee was politically minded, expensive, did not have a migratory organization, and its members lacked time and technical training. Most of its work related to engineering matters. (See the reports of its secretary in the annual report of Department of Railways and Canals, 1889 to 1903.) The government rejected Dr. McLean's suggestions that the Board have control over stock issues; arbitrate in disputes between railways and their employees, and investigate proposed railway projects and their necessity for the districts through which they are to pass. On the matter of experimentation note this statement of the Minister of Agriculture in 1939: “During the four or five years this [Prairie Farm Rehabilitation] Act has been in operation we have found it necessary to do certain things by regulation which, now that the practice has been established, we think should be in legislative farm” ( Canada, House of Commons Debates, 1939, p. 1743 Google Scholar).
59 The duty of the Board is to perform its functions “with the object of co-ordinating and harmonizing the operations of all carriers engaged in transport … and the Board shall give … such fair interpretation as will best attain the object aforesaid” (Transport Act, 1938, a 53, s. 3(2)). “The provisions of this Act shall be interpreted and construed liberally in order to accomplish the purposes thereof” (The Public Utilities Act, Nova Scotia, 1943, c. 2, s. 110 and repeated in the Public Utilities Act, Prince Edward Island, 1940, c. 53, s. 49). See also the lengthy declaration in the United States Transport Act, 1940, and the Hoch-Smith Resolution of 1925 along with the narrowing interpretation put on such general directives by the United States Supreme Court (Ann Arbor Railroad Company et al. v. United States et al., (1930) 281 U.S. 658).
60 MacDonald, V. C., “Highway Transport” (in Henry, R. A. C., Railway Freight Rates in Canada, Raport of the Royal Commission on Dominion-Provincial Relations Appendix, Ottawa, 1940).Google Scholar
61 Walker, G., “The Economics of Road and Rail Competition” (Economic Journal, 06, 1933, pp. 217–36CrossRefGoogle Scholar); “Road and Rail Transport in Nova Scotia” (Nova Scotia Economic Council, Report, 1941).Google Scholar
62 Currie, A. W., “The Railways Talk Back” (Quarterly Journal of Commerce, autumn, 1942, pp. 246–52).Google Scholar
63 Monetary Times, Nov. 11, 1898, said: “To show the lengths railway competition will go, the Booth road and the Canadian Pacific being at war, passengers were carried from Renfrew to Ottawa and return (about 140 miles) for a quarter. The Mercury of last week describes a theatre party who went to Ottawa … each getting for 75 cents a return ticket by rail and a seat in the opera house at Ottawa to see the ‘Geisha’.” For an economic explanation see Jones, E., Principles of Railway Transportation (New York, 1924), chap. V.Google Scholar
64 Canadian National and Canadian Pacific Railways v. Canada Steamship Lines, (1940) 51 C.R.T.C. 185.
65 The legislature of Ontario set up a commission to remedy conditions resulting from the frequent overflowing of the Grand River. A plan was worked out including the erection of dams which would flood four miles of railway and necessitate its re-building. To save this expense the Grand River commission offered the two railways $80,000 if one of them would abandon the line to be flooded and together agree on joint operation. The application to abandon was refused by the Transport Commission because the evidence did not indicate a sufficient potential saving to offset the inconvenience suffered by the public. Chief Commissioner Cross pointed out that by the “public is meant the community that would be affected by the abandonment of the line of railway and not the general public” (Canadian Pacific Railway v. E. and W. Garafraxa, (1941) 52 C.R.T.C. 384).