A-1835-83
Aerie, Inc. (Applicant)
v.
Chairman of the Board of Directors, Canada Post
Corporation (Respondent)
Court of Appeal, Urie, Mahoney and Ryan JJ.—
Ottawa, October 11 and 29, 1984; January 11,
1985.
Jurisdiction — Federal Court — Appeal Division —
Application to review and set aside decision dismissing appeal
from refusal to register publication of Conference Board as
second class mail — Chairman alleging Court lacking juris
diction as Chairman not "person" within definition of 'federal
board, commission or other tribunal" in s. 2 of Federal Court
Act as authority commercial, and not 'jurisdiction" or "pow-
er" — Alternatively argument decision not required to be
made on judicial or quasi-judicial basis — Board's decision
not made pursuant to general power of management, but under
authority to entertain and dispose of "appeal" conferred by
regulation approved by Governor in Council pursuant to
Canada Post Corporation Act — Chairman "person" within s.
2 definition — Chairman's decision essentially judicial in light
of use of "appeal", right of appellant to make representations
and requirement Chairman apply provisions of s. 3.1 of Regu
lations to material before him — Appeal determined on quasi-
judicial basis — Although no "adversary" per se, issue suf
ficiently "adversarial" to require Chairman to proceed quasi-
judicially — Federal Court Act, R.S.C. 1970 (2nd Supp.), c.
10, ss. 2(g), 28 — Canada Post Corporation Act, S.C. 1980-
81-82-83, c. 54, ss. 5(1)(a),(2)(b),(e), 6(2), 7(1), 8(1), 13(1),(3),
17(1)(c),(d),(e),(2), 20, 22(1), 28, 29, 33 — Second Class Mail
Regulations, C.R.C., c. 1294, s. 4(2),(4) (as am. by SOR/78-
149, s. 2, SOR/82-33, s. 3), 6 (as am. by SOR/78-149, s. 4;
SOR/81-848, s. 3).
Judicial review — Application to review — Postal service --
Canada Post Chairman dismissing appeal from refusal to
register publication as second class mail based on s. 3.1(h) of
Regulations — S. 3.1(h) excluding from registration periodical
otherwise entitled to registration, where principal business
other than publishing and published as auxiliary to or for
purpose of advancing principal business — Chairman rejecting
submission Board not in business, finding publishing not
Board's principal business and publishing it does auxiliary to
principal business of conducting research and communicating
findings — Chairman's findings determinations of fact, not to
be upset absent error of law — Applicant submitting Chair
man erred in that if words "principal business" apply to
applicant, publishing integral part of Board's business, not
separate activity — Question whether publishing integral part
of applicant's business or separate activity not germane for
purpose of defining principal business in s. 3.1(h) — Failure to
examine and compare in so many words all of Board's activi
ties not leading to assumption Chairman did not do so —
Record supporting Chairman's findings — Application dis
missed — Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10,
s. 28.
Statutes — Interpretation — Second Class Mail Regula
tions — S. 3.1(h) of Regulations excepting from registration as
second class mail periodical, otherwise entitled to registration,
where principal business of publisher other than publishing
and published as auxiliary to or for purpose of advancing
principal business — Meaning of "business" determined in
context and in light of statutory purpose — Business having
broader meaning than activity, preponderant objective of which
profit-making — Periodical registrable if published neither as
auxiliary to nor for purpose of advancing publisher's principal
activity — Use of word "business" eliminating from consider
ation, in determining principal activity, activities not con
sidered business in broad, common sense way, i.e., recreational
activities — Board's activities, including research, communi
cation, and other services, performed on daily basis by full-
time staff constituting occupation requiring continuing atten
tion — Chairman correctly holding Board's activities con
stituting business — Second Class Mail Regulations, C.R.C.,
c. 1294, s. 3.1 (as am. by SOR/82-33, s. 2; SOR/83-56, s. 2) —
An Act to amend the Post Office Act, S.C. 1931, c. 45, s. 1 —
The Post Office Act 1867, S.C. 1867, c. 10, ss. 22, 23, 24, 25
— The Post Office Act, 1875, S.C. 1875, c. 7, ss. 22, 23, 24 —
The Post Office Act, S.C. 1951, c. 57, ss. 6(t) (as am. by S.C.
1968-69, c. 5, s. 2), 11 (as am. idem, s. 4), 12 (as am. idem, s.
4) — Post Office Act, R.S.C. 1952, c. 212, s. 11 — Income Tax
Act, S.C. 1970-71-72, c. 63 (as am. by S.C. 1976-77, c. 4, s.
60).
Application to review and set aside the decision of the Board
Chairman of Canada Post dismissing an appeal from a refusal
to register a periodical published by the Conference Board of
Canada as second class mail. The Conference Board is incorpo
rated as a non-profit organization. Its purposes are charitable,
scientific and educational. The Chairman dismissed the appeal
on the ground that paragraph 3.1(h) of the Regulations bars
registration because the Conference Board's principal business
is not publishing, and because the publishing it does is carried
on as an auxiliary to or for the purpose of advancing the
Conference Board's principal business. The Conference Board
argues that the Chairman erred in law by misinterpreting
paragraph 3.1(h) of the Regulations. The Board also alleges
that as it is not engaged in business, paragraph 3.1(h) does not
apply. The Chairman argues that the Court does not have
jurisdiction because the Chairman, in disposing of the appeal, is
not "a person" within the definition of "federal board, commis
sion or other tribunal" in the Federal Court Act. The authority
the Chairman exercised in dismissing the Conference Board's
appeal was strictly commercial in nature, and thus was not a
"jurisdiction" or "power" contemplated by the definition.
Alternatively the Chairman's decision was not one required by
law to be made on a judicial or quasi-judicial basis.
Held, the application should be dismissed.
The respondent submits that the terms of the definition of
"federal board, commission or other tribunal" do not refer to
jurisdiction and powers of a commercial nature conferred by
federal statute on a corporation such as the Canada Post
Corporation. The Canada Post Corporation Act requires the
Corporation to operate a postal service, having regard to the
need to conduct its operations on a self-sustaining financial
basis, and to maintain a corporate identity program approved
by the Governor in Council that reflects the role of the Corpo
ration as an institution of the Government of Canada. The
Canada Post Corporation is subject to the oversight of the
Governor in Council, the Minister, and the President of the
Treasury Board. Although the Canada Post Corporation is, in
the language of SOR/8l-804, "responsible for the management
of services operations on a quasi-commercial basis", it is differ
ent from an ordinary commercial corporation. The roles played
by the Governor in Council and the Minister in respect of the
Corporation give it a significant public character.
Wilcox v. Canadian Broadcasting Corporation, [1980] 1
F.C. 326 (T.D.), in which the CBC was held not to be a
"federal board, commission or other tribunal", is distinguish
able. There the dispute centered around the power to engage
employees. The decision under attack here was made in the
exercise of an authority conferred by a regulation approved by
the Governor in Council, not merely in the exercise of a general
power of management.
The authority is to entertain and dispose of an "appeal",
something very different from a mere system for handling
complaints as alleged by the respondent. The Chairman, in
entertaining and disposing of an appeal is a "person" within the
definition in section 2.
The decision is not merely a business one, but at least an
administrative decision. The Regulations require a postal offi
cial who refuses an application for registration to give reasons
for his refusal. A dissatisfied applicant may "appeal" to the
Chairman. The appellant has the right to make representations.
The right to make representations and the use of the word
"appeal" are significant. A successful appellant might be en
titled to reimbursement for excess postage. The Chairman's
decision must be made by applying the provisions of section 3.1
of the Regulations to the information and material forwarded
to him under subsection 6(3). The decision to be made is thus
essentially judicial in character. The Regulations point to the
conclusion that an appeal must be determined on at least a
quasi-judicial basis. The respondent submitted that the third
criterion set out in Minister of National Revenue v. Coopers
and Lybrand, [1979] 1 S.C.R. 495, "Is the adversary process
involved?", had not been met. The argument that there was not
a party adverse in interest to the appellant gives to the term
"adversary" an unduly limited meaning. Although the official
who made the original decision may not have been strictly
speaking an "adversary", the issue presented on appeal was
sufficiently "adversarial" to require the Chairman to proceed
quasi-judicially.
The Chairman rejected the submission that the Board is not
in business and held that the word "business" as used in
paragraph 3.1(h) has a broader meaning than an activity, the
preponderant objective of which is profit making. The Chair
man held that "business" includes practically any activity
which is an occupation as distinguished from a "pleasurable
activity".
The term "business" has been given a variety of meanings,
but when it appears in a statute its meaning must be sought in
context and in light of statutory purpose. Until 1968, newspa
pers and periodicals which fell within subsections 11(1) and (3)
of the Post Office Act were entitled to be mailed at the rate
specified without distinction being made among publishers on
the basis of whether they were engaged in business or in
non-profit activities or whether publishing was or was not their
principal business. A new section 11, which expanded the range
of publications entitled to second class mailing rates, was
enacted in 1968, and was eventually replaced by section 3.1 of
the Regulations. The changes in 1968 limited the range of
persons eligible to avail themselves of these rates by the enact
ment of paragraphs (h) and (i).
The applicant's interpretation of paragraph 3.1(h) as being
concerned only with persons engaged in activities, the prepon
derant purpose of which is the making of profit, turns on
interpreting "principal business" as meaning not simply "prin-
cipal activity", but principal profit-making activity". It would
treat paragraph (h) as having to do with persons who are
engaged in such activities and paragraph (i) as having to do
with persons who are engaged in non-profit making activities,
and as having the effect of limiting the availability of second
class mail rates to some but not all of them. Canadian periodi
cals falling within paragraph (a), (b) or (c) could be registered
as second class mail if the person seeking registration were not
within paragraph (h) whatever might be his principal activity.
Persons covered by paragraph (i) would be limited to register
ing periodicals falling within paragraphs (b) and (c), while
other persons not engaged in profit-making activities could also
register periodicals falling within paragraph (a).
A "better" reading of paragraph (h) is to deny registration to
a newspaper or periodical, otherwise qualified, if the principal
business, in the sense of principal activity, of its publisher is
other than publishing. The exception is that, even in such a
case, the newspaper or periodical may be registered if it is
published neither as an auxiliary to nor for the purpose of
advancing the publisher's principal activity. The use of the
word "business" eliminates from consideration, in determining
principal activity, any activity which cannot be regarded in a
broad common sense way as a business activity, i.e., recreation
al activities.
Nothing indicates an intention to leave second class mailing
privileges open to non-profit-making enterprises as a means of
assisting them. The purpose of paragraph (i) is to make special
provision for certain newspapers and periodicals that might be
barred from admission to second class mail if paragraph (h)
were left to operate without exception. By virtue of paragraph
(1), a Canadian newspaper or periodical published by a frater
nal, trade, professional or other similar association, or by a
trade union, credit union, cooperative, or local church organiza
tion can be registered as second class mail though publishing
may not be the principal activity of the association, provided
that the publication is one described in paragraph (b) or (c).
The Chairman did not err in law in deciding that "business"
is broad enough to include the activities of the Conference
Board, nor in deciding that "business", as used in paragraph
(h), is not limited to profit-making activities. The activities of
the Conference Board, including research, communication, and
other services provided to its members are carried on by the
Board on a day-to-day basis by a full-time staff in such a way
as to amount to the carrying on of an "occupation" requiring
continuing attention. That subscription rates for its publication
are established indicates that there is a commercial aspect to
certain of the Board's publishing activities.
The Chairman's finding that the Board's principal business is
not publishing, and that the publishing it does is auxiliary to or
for the purpose of advancing the Board's principal business, are
determinations of fact which cannot be upset absent error of
law.
The applicant submitted that the Chairman erred, in that if
"principal business" applies to it, publishing is an integral part
of the Board's business, not a separate activity. The question of
whether "publishing" is an integral part of the applicant's
business or 'a separate activity' is not germane for the purpose
of defining `principal business' in paragraph 3.1(h). A "busi-
ness" is typically made up of various constituent and related
activities as is the case with the applicant. Paragraph 3.1(h)
requires a determination of the principal business of the
applicant.
The applicant submitted that the Chairman erred in law
because he did not examine and compare all of the Board's
activities. While the Chairman does not, in so many words,
examine all of the facts which might be appropriate to his
determinations, it cannot be assumed that he did not in fact do
so. There is material in the record to support the findings of
fact made by the Chairman.
CASES JUDICIALLY CONSIDERED
APPLIED:
Minister of National Revenue v. Coopers and Lybrand,
[ 1979] 1 S.C.R. 495; Customs and Excise Comrs v. Lord
Fisher, [1981] 2 All E.R. 147 (Q.B.D.); Canada Labour
Relations Board et al. v. Yellowknife, [1977] 2 S.C.R.
729.
CONSIDERED:
Wilcox v. Canadian Broadcasting Corporation, [1980] 1
F.C. 326 (T.D.); The Regional Assessment Commission
er et al. v. Caisse populaire de Hearst Limitée, [1983] 1
S.C.R. 57; Minister of National Revenue v. Consolidated
Mogul Mines Limited, [1969] S.C.R. 54; Rael-Brook
Ltd. v. Minister of Housing and Local Government,
[1967] 2 Q.B. 65; Re Pszon, [1946] 2 D.L.R. 507 (Ont.
C.A.).
REFERRED TO:
Nenn v. R., [1979] 2 F.C. 778 (C.A.); McCleery v. The
Queen, [1974] 2 F.C. 339 (C.A.); Laroche v. Commis
sioner of R.C.M.P. (1981), 39 N.R. 407 (F.C.A.); Mac-
donald Tobacco Inc. v. Canada Employment and Immi
gration Commission, [1979] 2 F.C. 100 (C.A.);
Abernethie v. A.M. & J. Kleiman Ltd., [1970] 1 Q.B. 10
(C.A.); Consumers' Association of Canada v. Postmaster
General, [1975] F.C. 11 (C.A.).
COUNSEL:
J. François Lemieux and Patricia Wilson for
applicant.
Gordon F. Henderson, Q.C. and Emilio S.
Binavince for respondent.
SOLICITORS:
Herridge, Tolmie, Ottawa, for applicant.
Gowling & Henderson, Ottawa, for respond
ent.
The following are the reasons for judgment
rendered in English by
RYAN J.: This is a section 28 application to
review and set aside a decision of the respondent,
the Chairman of the Board of Directors, Canada
Post Corporation, dismissing an appeal by the
applicant under section 6 of the Second Class
Mail Regulations [C.R.C., c. 1294, as am. by
SOR/78-149, s. 4; SOR/81-848, s. 3] ("the Regu
lations"). The appeal was brought from a refusal
by the Manager of the Mail Classification Division
to register a periodical, Consumer Markets
Update, a publication of The Conference Board of
Canada, as second class mail. The applicant,
Aeric, Inc., is, by the way, referred to as The
Conference Board of Canada. The originating
notice under section 28 relates not only to Con
sumer Markets Update, but to other publications
of the applicant as well. An order of this Court,
dated February 7, 1984, stipulates, however, that
the determination of this Court in respect of the
publication Consumer Markets Update will apply
to the other publications listed in the originating
notice. I would note, however, that the applicant
has withdrawn its application to review the deci
sion of the respondent as it relates to the publica
tion Datafacts.
The Conference Board of Canada is incorpo
rated as a non-profit organization. Counsel sub
mitted that the Board's purposes are charitable.
scientific and educational. The publication sought
to be registered is, in the applicant's submission, a
Canadian newspaper or periodical falling within
section 3.1 [as am. by SOR/82-33, s. 2; SOR/83-
56, s. 2] of the Regulations and is, therefore.
entitled to registration. The Chairman dismissed
the appeal to him on the ground that paragraph
3.1(h) of the Regulations bars registration because
the Conference Board's principal business is not
publishing, and because the publishing it does iE
carried on as an auxiliary to or for the purpose of
advancing the Conference Board's principal busi
ness. The Conference Board's case is that, as it is
not engaged in business at all, paragraph 3.1(h) of
the Regulations does not apply to it. Counsel for
the Chairman submitted that, in any event, we
cannot reach the issue raised by the applicant; this
Court, he said, lacks jurisdiction to entertain the
section 28 application because the Chairman, in
disposing of the appeal, is not "a person" within
the definition of "federal board, commission or
other tribunal" in the Federal Court Act [R.S.C.
1970 (2nd Supp.), c. 10]: the authority the Chair
man exercised in dismissing the Conference
Board's appeal was strictly commercial in nature,
and thus was not a "jurisdiction" or "power' .
contemplated by the definition. Counsel submitted,
in the alternative on the jurisdictional issue, that
the Chairman's decision was not one which was.
required by law to be made on a judicial of
quasi-judicial basis.
Two basic issues were thus raised. The respond
ent submitted that this Court lacks jurisdiction tc
entertain this section 28 application. The appli
cant, of course, supported jurisdiction. The appli
cant on its part contested the decision of the
Chairman on its merits. It submitted that the
Chairman of the Board of Directors erred in law in
dismissing the appeal; he erred, it was argued, by
misinterpreting paragraph 3.1(h) of the Regula
tions.
THE JURISDICTIONAL ISSUE
Counsel for the respondent submitted, as I have
just indicated, that the Chairman of the Board of
Directors of the Canada Post Corporation is not a
"federal board, commission or other tribunal" as
that term is defined under section 2 of the Federal
Court Act; accordingly, his dismissal of the appli
cant's appeal is not subject to review under section
28 of that Act. The definition in section 2 reads:
2....
"federal board, commission or other tribunal" means any body
or any person or persons having, exercising or purporting to
exercise jurisdiction or powers conferred by or under an Act
of the Parliament of Canada, other than any such body
constituted or established by or under a law of a province or
any such person or persons appointed under or in accordance
with a law of a province or under section 96 of The British
North America Act, 1867;
The submission was that the "jurisdiction and
powers" referred to in the definition refer to juris
diction and powers of a public nature, the exercise
of which would, before the Federal Court Act was
enacted, have attracted judicial review in a supe
rior court by prerogative writ, injunction or
declaratory action. The terms of the definition do
not, it was argued, refer to jurisdiction and powers
of a commercial nature conferred by federal stat
ute on a corporation such as the Canada Post
Corporation. The respondent particularly relied on
a passage from the reasons for judgment of Associ
ate Chief Justice Thurlow [as he then was] in
Wilcox v. Canadian Broadcasting Corporation,
[1980] 1 F.C. 326 (T.D.). The Associate Chief
Justice, speaking of the "powers" referred to in the
definition under section 2 of the Act, said at pages
329 and 330:
... it appears to me that the expression "jurisdiction or pow
ers" refers to jurisdiction or powers of a public character in
respect of the exercise of which procedures by prerogative writs
or by injunction or declaratory relief would formerly have been
appropriate ways of invoking the supervisory authority of the
superior courts. I do not think it includes the private powers
exercisable by an ordinary corporation created under a federal
statute which are merely incidents of its legal personality or of
the business it is authorized to operate. Absurd and very
inconvenient results would flow from an interpretation that it
does include such powers and it does not appear to me that that
was intended or that it is necessary to so interpret the expres
sion in the context in which it is used.
Counsel submitted that the Canada Post Corpo
ration is a corporation engaged in a commercial
operation. The powers it exercises under the
Canada Post Corporation Act [S.C. 1980 - 81 - 82-
83, c. 54] are thus not powers of the kind referred
to in the definition in section 2 of the Federal
Court Act. Counsel referred in particular to para
graphs 5(1)(a), 5(2)(b) and subsection 13(1) of
the Canada Post Corporation Act.
Paragraph 5(1)(a) provides:
5. (1) The objects of the Corporation are
(a) to establish and operate a postal service for the collection,
transmission and delivery of messages, information, funds
and goods both within Canada and between Canada and
places outside Canada;
Paragraph 5(2)(b) reads:
5....
(2) While maintaining basic customary postal service, the
Corporation, in carrying out its objects, shall have regard to
(b) the need to conduct its operations on a self-sustaining
financial basis while providing a standard of service that will
meet the needs of the people of Canada and that is similar
with respect to communities of the same size;
I would, however, also refer to paragraph
5(2)(e), which reads:
5....
(2) While maintaining basic customary postal service, the
Corporation, in carrying out its objects, shall have regard to
(e) the need to maintain a corporate identity program
approved by the Governor in Council that reflects the role of
the Corporation as an institution of the Government of
Canada.
Subsection 13(1) provides:
13. (1) The Corporation may employ such officers and
employees and may engage the services of such agents, advisers
and consultants as it considers necessary for the proper conduct
of its business, and may fix the terms and conditions of their
employment or engagement, as the case may be, and pay their
remuneration.
In support of the submission that the Canada
Post Corporation is essentially commercial, coun
sel also referred to P.C. 1981-2769, which is SOR/
81-804. This instrument reads:
Whereas subsection 22(1) of the Canada Post Corporation
Act provides that the Canada Post Corporation established
pursuant to section 4 of the said Act is an agent of Her Majesty
in right of Canada;
And Whereas paragraph 66(3)(b) of the Financial Adminis
tration Act provides that the Governor in Council may by order
add to Schedule C to the Financial Administration Act any
Crown Corporation that is an agent of Her Majesty in right of
Canada and is responsible for the management of services
operations on a quasi-commercial basis.
Therefore, His Excellency the Governor General in Council,
on the recommendation of the Treasury Board, pursuant to
paragraph 66(3)(b) of the Financial Administration Act, is
pleased hereby to add the Canada Post Corporation to
Schedule C to the Financial Administration Act.
Under subsection 66(1) of the Financial
Administration Act [R.S.C.1970, c. F-10], a
Crown corporation named in Schedule C is an
"agency corporation". A consequence of its being
an agency corporation is that, by virtue of subsec
tion 68(1) of the Financial Administration Act,
sections 69 to 78 of that Act apply to it. These
sections subject the Corporation to the oversight of
the Governor in Council, the Minister, and the
President of the Treasury Board in significant
ways. I would note, for example, that subsection
70(1) of the Act provides:
70. (1) Each agency corporation shall annually submit to the
appropriate Minister an operating budget for the next following
financial year of the corporation for the approval of the appro
priate Minister and the President of the Treasury Board.
Counsel also called our attention to subsection
17(1) of the Canada Post Corporation Act, which
authorizes the Corporation, with the approval of
the Governor in Council, to make regulations "for
the efficient operation of the business of the Cor
poration ...". I quote paragraphs (c), (d) and (e)
of subsection 17 (1) and subsection 17(2):
17. (1) The Corporation may, with the approval of the
Governor in Council, make regulations for the efficient opera
tion of the business of the Corporation and for carrying the
purposes and provisions of this Act into effect, and, without
restricting the generality of the foregoing, may make
regulations
(c) prescribing the conditions under which mailable matter
may be transmitted by post;
(d) prescribing rates of postage and the terms and conditions
and method of payment thereof;
(e) providing for the reduction of rates of postage on mail-
able matter prepared in the manner prescribed by the
regulations;
(2) The rates of postage prescribed pursuant to subsection
(1) shall be fair and reasonable and consistent so far as possible
with providing a revenue, together with any revenue from other
sources, sufficient to defray the costs incurred by the Corpora
tion in the conduct of its operations under this Act.
It is quite clear that, in the words of P.C.
1981-2769, the Canada Post Corporation is
"responsible for the management of services opera
tions on a quasi-commercial basis". It is also clear,
however, that the Corporation is significantly dif
ferent from an ordinary commercial corporation.
As I have already noted, paragraph 5(2)(e) of its
incorporating statute refers to "the role of the
Corporation as an institution of the Government of
Canada". Section 11 confers authority on the
Board of Directors to make by-laws "for the
administration, management and control of the
property and affairs of the Corporation", but such
by-laws must be approved by the Governor in
Council. The authority to make regulations con
ferred by subsection 17(1) is also subject to the
approval of the Governor in Council. Other differ
ences between the Corporation and an ordinary
commercial corporation are illustrated by such
provisions of its incorporating Act as subsections
6(2), 7(1), 8(1), 13(3) and 22(1), and sections 20,
28, 29 and 33, and by sections 69 to 78 of the
Financial Administration Act. The roles played by
the Governor in Council and the Minister in
respect of the Corporation give it a significant
public character and may possibly account for the
use of the word "quasi-commercial" rather than
the word "commercial" in the description, in the
Order in Council, of its responsibilities for man
agement of the postal services.
It may, of course, be argued that the Canadian
Broadcasting Corporation also has a public char
acter in rather the same sense; nonetheless Associ
ate Chief Justice Thurlow concluded in the Wilcox
case [at page 329] that the CBC "is, at least in
respect of its broadcasting activities, not a federal
board, commission or other tribunal within the
meaning of section 2 . ..". It is, therefore, impor
tant, to identify the issue in the Wilcox case, and
to consider the corporate powers involved.
In Wilcox, an employee of the CBC, in an
action brought under section 18 of the Federal
Court Act, sought a declaration that, for the pur-
pose of calculating his pensionable services, he was
entitled to count a period of pensionable service he
had accumulated before leaving the RCMP to take
up his employment with the CBC. His claim was
thus based on his contract of employment. He
alleged that it was a term of his contract that the
defendant was to make arrangements for the
transfer of his accumulated pensionable service.
The Court held that it lacked jurisdiction under
section 18 to entertain the action. After saying
what he did in the passage I quoted above, the
Associate Chief Justice added at page 330:
It appears to me, as well, that if the powers of the defendant
under the Broadcasting Act in respect of the defendant's
broadcasting activities are not powers of the kind embraced by
the definition, there is even less reason to conclude that the
power of the defendant to engage employees falls within the
meaning of the definition.
The decision of the Chairman of the Board
which is under review was not made in the exercise
of a general power of management conferred on
the Canada Post Corporation. His decision was
made in the exercise of an authority conferred on
him by a regulation approved by the Governor in
Council pursuant to the Canada Post Corporation
Act. The authority is an authority to entertain and
dispose of an "appeal". The respondent suggested
that the "appeal" is analogous to the sort of
procedure often established by a business firm to
handle customer complaints. But the procedure
under section 6 of the Regulations (which I exam
ine in detail below) is very different from a mere
system for settling complaints. The "appeal" pro
vided by section 6 is precisely that: it is an appeal.
I am satisfied that the Chairman, in entertaining
and disposing of the appeal in this case, is a
"person" within the meaning of that word as it is
used in the definition of "federal board, commis
sion or other tribunal" in the Federal Court Act.
The respondent submitted that at any rate the
decision is not an administrative decision required
by law to be made on a judicial or quasi-judicial
basis. It seems quite clear, for the reasons I have
just given, that the decision is not merely a busi
ness decision. And it seems equally clear that it is
at least administrative. But is it a decision required
by law to be made on a judicial or quasi-judicial
basis?
Subsection 4(2) of the Regulations gives a pub
lisher a right to apply to a postal official to register
a newspaper or periodical as second class mail.
Subsection 4(4) [as am. by SOR/78-149, s. 2;
SOR/82-33, s. 3] prescribes the rights and duties
of the postal official to whom such an application
is made. It provides:
4....
(4) A postal official to whom an application for registration
of a publication as second class mail is made in accordance with
this section shall, immediately after the receipt by him of the
application and such other information and material as he may
request, examine the application and if he determines
(a) that the publication qualifies as second class mail and
that it will be prepared for mailing in the manner prescribed
by these Regulations, he shall register it for mailing at the
rate of postage that he determines is established for it in the
table to Schedule II of the Rates of Postage Regulations and
shall forthwith notify the applicant of the day on which
registration was granted, the registration number assigned to
the publication and the rate of postage for which it has been
registered for mailing; or
(b) that the publication does not qualify as second class mail
or that it will not be prepared for mailing in the manner
prescribed by these Regulations, he shall refuse to register
the publication and shall forthwith notify the applicant of his
refusal and the reason or reasons therefor.
Section 6 of the Regulations confers a right of
appeal on a publisher dissatisfied with a decision
of a postal official under paragraph 4(4)(b). I
quote section 6:
6. (1) Where the publisher of a newspaper or periodical is
dissatisfied with the decision of a postal official refusing to
register the newspaper or periodical as second class mail pursu
ant to paragraph 4(4)(b), he may, within thirty days of the date
of such refusal, by notice in writing to the postal official, appeal
the decision to the Chairman.
(2) The notice in writing referred to in subsection (1) shall
contain any representations that the publisher wishes to make
to the Chairman with respect to the appeal.
(3) The postal official referred to in subsection (1) shall,
immediately on receipt of the notice in writing referred to in
that subsection, forward it to the Chairman together with all
information and material that was before the postal official at
the time he refused to register the newspaper or periodical as
second class mail.
(4) Until the Chairman gives his decision on an appeal, any
copies of the newspaper or periodical that is the subject of the
appeal that are mailed shall be mailed at the third or fourth
class rate, and the publisher shall keep a record, in a form and
manner approved by the postmaster at the post office of
mailing, of any such copies so mailed.
(5) Where the Chairman determines that a newspaper or
periodical that is the subject of an appeal should be registered
as second class mail, the newspaper or periodical shall be
deemed to have been registered as second class mail as of the
date the most recent application was received by the postal
official and the publisher shall be reimbursed for any excess
postage he has paid by reason of having mailed copies at the
third or fourth class rate.
(6) In determining the amount of reimbursement to which a
publisher is entitled under subsection (5), the only record that
shall be taken into account is that kept in the form and manner
approved by the postmaster at the post office of mailing
pursuant to subsection (4).
The provisions of section 4 and section 6 of the
Regulations contain important guides to determin
ing whether the Chairman's decision must be
made on a judicial or quasi-judicial basis.
A postal official who refuses an application for
registration must give the unsuccessful applicant
the reason or reasons for his refusal. An applicant
who is dissatisfied may "appeal" to the Chairman.
The appellant has the right to make representa
tions. The right to make representations and the
use of the word "appeal" are themselves signifi
cant: see Nenn v. R., [1979] 2 F.C. 778 (C.A.), at
page 781. On an appeal, the Chairman must deter
mine whether the newspaper or periodical that is
the subject of the appeal should be registered as
second class mail, an important right. Such a
determination has another significant consequence
under subsection 6(5) of the Regulations: a suc
cessful appellant might be entitled to reimburse
ment for excess postage.
The decision of the Chairman is in no sense a
decision to be made on the basis of policy. The
decision must be made by applying the provisions
of section 3.1 of the Regulations to the informa
tion and material forwarded to the Chairman
under subsection 6(3). The decision to be made is
thus essentially judicial in character.
The relevant provisions of the Regulations point
compellingly to the conclusion that an appeal must
be determined on at least a quasi-judicial basis.
The respondent stressed, however, that the
appeal was not adversarial. The submission, in
effect, was that the third of the four criteria
formulated by Mr. Justice Dickson (as he then
was) in Minister of National Revenue v. Coopers
and Lybrand, [1979] 1 S.C.R. 495, at page 504, as
criteria for determining whether a decision is one
required by law to be made on a judicial or
quasi-judicial basis, had not been met. [Possibly I
should note that the respondent submitted that
none of the four criteria had been met.] The third
criterion is: "(3) Is the adversary process
involved?"
There was not, it was said, a party adverse in
interest to the appellant. This seems, however, to
give to the term "adversary" an unduly limited
meaning. There was clearly an issue to be decided
on the appeal. The postal official who denied
registration gave as his reason that paragraph
3.1(h) of the Regulations bars registration. The
appellant disputed this. To settle the appeal, the
Chairman had to resolve this dispute. The official
who made the original decision may not, strictly
speaking, have been an "adversary". The issue
presented was, however, sufficiently "adversarial"
to require the Chairman to proceed quasi-judicial
ly: see S.A. de Smith, Judicial Review of
Administrative Action (4th ed., 1980) at pages 84
and 85. The proceeding here was at least as adver
sarial as was the "appeal" to the Commissioner of
the Royal Canadian Mounted Police from the
recommendation for dismissal of a member of the
Force, the appeal involved in McCleery v. The
Queen, [1974] 2 F.C. 339 (C.A.); and see Laroche
v. Commissioner of R.C.M.P. (1981), 39 N.R. 407
(F.C.A.), particularly at page 424; see also Mac-
donald Tobacco Inc. v. Canada Employment and
Immigration Commission, [1979] 2 F.C. 100
(C.A.).
My conclusion is that we have jurisdiction to
entertain this section 28 application.
THE ISSUE ON THE MERITS
I turn to the issue on the merits.
The Chairman of the Board of Directors dis
missed the appeal on the basis that paragraph
3.1(h) of the Regulations excludes the periodical
from registration as second class mail. That para
graph excludes from registration a periodical
which would otherwise be entitled to registration,
3.1 ...
(h) where the principal business of the person by whom or at
whose direction it is published is other than publishing, [and]
it is published as an auxiliary to or for the purpose of
advancing such person's principal business,
The Conference Board had submitted, as it did
before us, that paragraph 3.1(h) does not exclude
it from second class mail registration because the
paragraph does not apply to it. The Board's pur
poses are entirely charitable, scientific and educa
tional. In no sense can it be said to have, as its
preponderant objective, the pursuit of profit,
which, it submitted, is the test of whether a person
is engaged in business. The Conference Board is
not in business at all. The periodical in question
cannot, therefore, be published by the Board "as
an auxiliary to or for the purpose of advancing" its
"principal business".
In support of this submission, counsel referred
us to the objects of the Conference Board as set
out in the letters patent incorporating Aeric, Inc.,
dated April 2, 1980. These contain, among other
provisions:
The objects of the corporation are exclusively charitable,
scientific and educational and are:
1. To conduct objective scientific research and investigation in
the fields of business, economics and public affairs and to make
available, through periodicals and other publications, the infor
mation resulting from such activities to its members and to
other persons, firms, corporations, associations, educational and
other institutions to the federal and provincial governments of
Canada and any department, bureau or agency thereof, and to
the general public;
2. To assemble, analyse and disseminate, on a non-political
basis, objective information in regard to economic conditions
and management experience in Canada and other countries;
3. To conduct educational and scientific conferences of execu
tives, professional specialists and others for discussion of eco
nomic, business and public affairs;
4. To contribute to the educational and professional training of
executives, and in general to encourage and promote the sound
development of Canadian industry.
It is specially provided that in the event of dissolution or
winding up of the Corporation, all its remaining assets after
payment of its liabilities, shall be distributed to one or more
recognized charitable organizations in Canada.
The Corporation is to carry on its operation without pecuni
ary gain to its members and any profits or other accretions to
the proposed Corporation are to be used in promoting its
objects.
Aeric, Inc. has been granted tax-exempt status
as a registered charitable organization under para-
graph 149.1(1)(b) of the Income Tax Act [S.C.
1970-71-72, c. 63 (as am. by S.C. 1976-77, c. 4,
s. 60)].
The Chairman rejected the submission that the
Conference Board is not in business. He held that
the word "business", as used in paragraph 3.1(h),
has a broader meaning than an activity the pre
ponderant objective of which is profit making. He
said:
With regard to the first question, I suggest that you are giving
too restrictive an interpretation to the word "business". If one
considers the Second Class Mail Regulations as a whole,
including the French version of the Regulations and particular
ly paragraph 3.1(h) of that version where the word "l'activité"
is used with reference to "principale" rather than, for example,
"affaire", it is clear that a rather broad meaning was intended
to be given to the word "business". I do not consider that it
should be restricted to profit making ventures or operations. It
includes, in my opinion, practically any activity which is an
occupation as distinguished from a "pleasurable activity."
Consequently, on the view I take of the matter, the Conference
Board of Canada is engaged in "business" within the meaning
of that word in paragraph 3.1(h) of the Second Class Mail
Regulations.
The term "business" is not a term of art. As
used in statutes and in contracts, it has been given
a variety of meanings by the courts. I will refer to
a few examples.
In Canada Labour Relations Board et al. v.
Yellowknife, [1977] 2 S.C.R. 729, Mr. Justice
Pigeon said at page 738:
In my view, it would not be proper to seek to put a restricted
meaning on any of the words "work, undertaking or business"
as used in the Labour Code so as to exclude from their scope all
activities of municipal corporations. Some of these operations,
like waterworks and sewage systems, undoubtedly come within
any concept of "work". Others, like protection or sanitation
services, cannot be excluded from the scope of "undertaking"
without doing violence to the language, and "business" has
been said to mean "almost anything which is an occupation, as
distinguished from a pleasure—anything which is an occupa
tion or duty which requires attention ..." (per Lindley, L.J. in
Rolls v. Miller, at p. 88). There is no doubt that the word
"business" is often applied to operations carried on without an
expectation of profit. In my view, it would be contrary to the
whole concept of classifying employees for jurisdictional pur
poses by reference to the character of the operation, to attempt
to make a distinction depending upon whether the employer is a
private company or a public authority. Different considerations
may obtain where the employer is a government or government
corporation and this is apparent from s. 109 of the Labour
Code. However, this is a question with which we are not
concerned in this case.
In that case, the issue was whether the Canada
Labour Relations Board had jurisdiction to certify
a union as collective bargaining agent for the
employees of a municipality in the Northwest Ter
ritories. The passage quoted clearly indicates the
importance of context and statutory purpose when
the meaning of "business" is in issue.
The applicant relied particularly on The
Regional Assessment Commissioner et al. v.
Caisse populaire de Hearst Limitée, [1983] 1
S.C.R. 57, in support of its submission that "busi-
ness" relates to a profit-making undertaking. In
that case, a credit union had been assessed for
business taxation under the Ontario Assessment
Act [R.S.O. 1980, c. 31]. It was assessed in respect
of its use of real property occupied by it in connec
tion with its operations. The relevant provision of
the Assessment Act imposed a "business assess
ment" on a person carrying on the business of a
banker or other financial business, an assessment
to be computed by reference to the assessed value
of the land occupied or used by him for the
purpose of the business. ("Business assessment" is,
of course, imposed on persons in other businesses
than banking and finance.) The critical issue was
this: to determine whether the credit union was
carrying on business, was it necessary to determine
that its preponderant purpose was to make a profit
or would it be enough to establish that it was
carrying on a "commercial activity". The Supreme
Court held that "preponderant purpose to make a
profit" was the appropriate test under the Assess
ment Act.
I would quote this passage from the reasons for
judgment of Mr. Justice McIntyre at pages 69 and
70:
The commercial activity test, as expressed by Evans J.A.,
requires a consideration and an evaluation of all factors in
order to determine whether in reality the corporation is of a
true commercial nature. He has also expressed the view that
one activity of a commercial nature may colour the whole of
the corporation's operations and be sufficient, as in the Wind-
sor-Essex case, to classify it as a business. It would seem to me
that on this last point he is really applying the preponderant
purpose test, finding that one purpose may be sufficiently
important to colour the whole. As I have indicated earlier, I do
not reject such a suggestion but, if it is applied to determine
whether an enterprise is of a commercial nature, difficulties
will arise. Many community and charitable organizations, rely
ing from time to time on what would be termed commercial
activity to raise funds for the fulfilment of their objectives,
could be classed as businesses by such a test. To attach primary
importance to the commercial aspect of an operation in ques
tion will offer, in my opinion, no sure or helpful guide. In my
view, the commercial activity test is too indefinite to allow
consistent application. I agree that, in deciding whether or not
any activity may be classed as a business under the provisions
of s. 7(1)(b) of The Assessment Act, all relevant factors
regarding an operation must be considered and weighed. How
ever, they must be considered and weighed in order to deter
mine not whether in some general sense the operation is of a
commercial nature or has certain commercial attributes, but
whether it has as its preponderant purpose the making of a
profit. If it has, it is a business; if it has not, it is not a business.
I would also quote this passage appearing at
page 71:
The preponderant purpose test has had wide—in fact almost
complete—acceptance in Ontario and certain other provinces
since the decision in the Rideau Club case. Essentially it has
been based upon a consideration of whether the activity con
cerned is carried on for the purpose of earning a profit or for
some other preponderant purpose. If the preponderant purpose
was other than to make a profit, then even if there were other
characteristics of the organization, including an intent in some
cases to make a profit (see Maple Leaf case), it would not be
classed as a business.
The Legislature must be presumed to have long been aware
of the state of the law as declared in the line of authorities
referrea to above. As it has made no move to change it, I do not
think the Court should. I would accept and apply the prepon
derant purpose test. In view of the findings of fact in the case at
bar earlier mentioned that the preponderant purpose of the
respondent is not to make a profit, I would dismiss the appeal
with costs.
I would observe that in the Caisse populaire
case it appears that there was no question that, for
the credit union to be carrying on business, its
activity would at least have had to have a commer
cial character, but even that would not be suffi
cient for purposes of the Ontario Assessment Act.
I would also observe that regard was had to the
presumption that the Legislature must have been
"aware of the state of the law as declared in the
line of authorities referred to above", but "made
no move to change it". "The line of authorities"
appears to have related primarily to assessment
under provincial legislation.
The respondent placed some reliance on the
judgment of the English Queen's Bench Division in
Rael-Brook Ltd. v. Minister of Housing and
Local Government, [1967] 2 Q.B. 65. In that case,
Mr. Justice Widgery said at page 75:
It is clear from authority that the making of profit is not an
essential feature of carrying on a business unless the particular
context so requires.
That case involved the question of whether a
corporation which acquired a building from a local
government authority and was using it for making
shirts required planning permission under a Town
and Country Planning Order. The building had
been used as a cooking centre for the purpose of
providing meals in schools. The corporation con
tended that permission was not required because
its present use was for a purpose of the same class
as that to which it had formerly been put. The
issue was whether the building was an "industrial
building" within a provision of the Planning
Order; this depended on whether the building was
used for a process "carried on in the course of a
trade or business". The Court carefully examined
the relevant provision of the Order in its context
and in the light of its purpose, and concluded at
page 76:
In our opinion neither the making of profit nor any commer
cial activity is an essential in order that a process may be
carried on in the course of trade or business for the purpose of
the definition of "industrial building" in the Town and Country
Planning (Use Classes) Order, 1950. Hence the activity of a
local authority which exhibits all the other possible features of
a business is not excluded on that account.
Even on the meagre findings of fact in the present case it can
be inferred that the provision of school meals by the local
authority in possession of the building from 1940 to 1946 was
"an occupation as distinguished from a pleasure," to quote
Lindley L.J. in Rolls v. Miller, that it was continuous rather
than sporadic, and that it was a serious undertaking earnestly
pursued for the purpose of fulfilling a duty assumed by the
occupier. Without attempting to decide that these features
must necessarily all be present in order that an activity may
amount to a business for present purposes, we are satisfied that
they suffice in this case.
Isolated passages from other cases might be
cited to an effect quite different from that suggest
ed by the sentence quoted in isolation from context
in Rael-Brook Ltd. Take, for example, this pas-
sage from the reasons for judgment of Mr. Justice
Laidlaw in Re Pszon, [1946] 2 D.L.R. 507 (Ont.
C.A.), at page 511:
... it is an essential element of carrying on business that the
purpose of the engagement is for a livelihood or profit. If an
enterprise is not conducted as a means to accomplish that
object it does not come within the ordinary meaning of the term
"business".
The sentences occur, however, at the end of a
passage [at page 511 ] which I will quote more
fully:
... The word "business" is of wider import than "trade": Re A
Debtor, [1927] 1 Ch. 97 at p. 105. As used in various statutes it
involves at least three elements: (1) the occupation of time,
attention and labour; (2) the incurring of liabilities to other
persons; and (3) the purpose of a livelihood or profit. A person
who devotes no time or attention or labour, by himself or by
servants or employees, to the working or conduct of the affairs
of an enterprise does not carry on the business of such enter
prise. He might, for instance, be only financially interested. But
to carry on business he must give attention, or perform labour,
for the maintenance or furtherance of the undertaking, and
devote time to the accomplishment of its objects. He must also
be in such relation to the public that he may be held liable to
others. The liabilities must be such as to be referable to the
carrying on of the enterprise. Obligations assumed in connec
tion with and for the purpose only of betterment of property
owned by a man do not necessarily constitute him a person who
carries on business. Finally, it is an essential element of carry
ing on business that the purpose of the engagement is for a
livelihood or profit. If an enterprise is not conducted as a means
to accomplish that object it does not come within the ordinary
meaning of the term "business".
The passage occurs in a case which had to do
with whether a particular person was a "wage-
earner" within the Bankruptcy Act, R.S.C. 1927,
c. 11. The definition of "wage-earner" is set out on
pages 510 and 511 of the report;
It will be convenient to reproduce parts of certain sections of
the Bankruptcy Act, R.S.C. 1927, c. 11 as follows:
"2. In this Act, unless the context otherwise requires or
implies, the expression"
"(ll) `wage-earner' means one who works for wages,
salary, commission or hire at a rate of compensation not
exceeding fifteen hundred dollars per year, and who does not
on his own account carry on business."
"7. The provisions of this Part shall not apply to
wage-earners ..."
My reading of the cases indicates that the mean
ing of the word "business", when it appears in a
statute, must almost always if not always be
sought in context and in the light of statutory
purpose. Often, I suspect, context and purpose will
point quickly to appropriate meaning. Unfortu
nately, ours is not such a case.
I will consider paragraph 3.1(h) of the Second
Class Mail Regulations in its context, and I will
also have regard to its legislative history. It may be
as well to set out in detail the relevant provisions
of section 3.1:
3.1 A Canadian newspaper or Canadian periodical
(a) that is published for the purpose of disseminating to the
public any one or more of the following:
(i) news,
(ii) articles of comment on or analysis of the news, and
(iii) articles with respect to other topics currently of
interest to the general public,
(b) that is devoted primarily to one or more of religion, the
sciences, agriculture, forestry, the fisheries, social or literary
criticism or reviews of literature or the arts or that is an
academic or scholarly journal, or
(c) that is devoted primarily to the promotion of public
health and published by a non-profit organization organized
on a national or provincial basis,
may, if it is
(d) registered with the Canada Post Corporation pursuant to
section 4,
be transmitted by post in Canada at the applicable rate of
postage referred to in section 3 for that newspaper or periodi
cal, unless
(h) where the principal business of the person by whom or at
whose direction it is published is other than publishing, it is
published as an auxiliary to or for the purpose of advancing
such person's principal business,
(i) except in the case of a publication described in paragraph
(b) or (c), it is published by or under the auspices of a
fraternal, trade, professional or other association or a trade
union, credit union, cooperative, or local church congrega
tion,
Special provisions for mailing rates for Canadi-
an newspapers and periodicals have had a long
history: see The Post Office Act 1867 [S.C. 1867,
c. 10], sections 22 to 25; and The Post Office Act,
1875 [S.C. 1875, c. 7], sections 22 to 24. Subsec
tions 11(1) and 11(3) of The Post Office Act
enacted by S.C. 1951, c. 57, provided:
II. (1) A newspaper or periodical that
(a) is printed and published in Canada;
(b) is known and recognized as a newspaper or periodical
and consists wholly or in great part of political or other
news or of articles relative thereto or to other current
topics;
may be transmitted by mail at the postage rate specified in this
section for such newspaper or periodical.
(3) Subject to subsection four, any newspaper or periodical
referred to in this section, other than one referred to in para
graph (e) or (/) of subsection two or the copies per issue of
those that may be transmitted free of postage under paragraph
(c) or (d) of subsection two, that is devoted to religion, the
sciences or agriculture is subject to postage at the rate of one
and one-half cents for each pound weight or fraction thereof.
These provisions also appear in the Post Office
Act, R.S.C. 1952, c. 212.
Special provisions in respect of newspapers or
periodicals devoted to "religion, the sciences or
agriculture" appear to have been introduced in
1931: see An Act to amend the Post Office Act,
S.C. 1931,c. 45.
It thus appears that, until 1968, newspapers and
periodicals which fell within subsections 11(1) and
11(3) of the Post Office Act were entitled to be
transmitted by mail at the postage rate specified in
the section without distinction being made among
publishers on the basis of whether they were or
were not engaged in business or in non-profit
activities or whether publishing was or was not
their principal business or activity.
A significant change was made in 1968. Section
4 of An Act to amend the Post Office Act, S.C.
1968-1969, c. 5, repealed sections 11 and 12 of the
Act and substituted new sections 11 and 12. Sec
tion 2 of the amending Act added a new paragraph
(t) to section 6 of the Post Office Act, the section
vesting the Postmaster General with regulation-
making powers. The new paragraph added the
power to make regulations:
6. ...
(t) respecting the registration of newspapers and periodicals
with the Post Office Department for the purposes of section
11 or 12, including the form and manner of making applica
tion for registration or for renewal of a registration, the fees
to be paid on the filing of any such application and the
duration of a registration or a renewal thereof;
The Canada Post Corporation Act repealed the
Post Office Act, and what had been subsection
11(1) of the Post Office Act now appears as
section 3.1 of the Second Class Mail Regulations.
The new subsection 11(1), introduced into the
Post Office Act in 1968, was in the same terms as
those which appear in the present section 3.1 of
the Regulations. There is one difference between
the old subsection of the Act and the present
section 3.1 of the Regulations. Subsection 11(1)
contained a paragraph (o) which now has been
removed. Paragraph (o) had the effect of exclud
ing from the benefit of the rate of postage speci
fied in the section a publication, described in para
graph (b) or (c) of the subsection, which was
published primarily for the benefit of the members
of a particular profession.
Paragraph (1)(b) of the new section [11] intro
duced in 1968 made the special rates applicable to
Canadian newspapers and periodicals available to
newspapers and periodicals primarily devoted to
forestry, fisheries, social or literary criticism or
which are reviews of literature or the arts or are
academic or scholarly journals, as well as to news
papers and periodicals devoted to religion, the
sciences and agriculture as previously had been the
case. Paragraph (1)(c) also made the special rates
available to a Canadian newspaper or Canadian
periodical "that is devoted primarily to the promo
tion of public health and published by a non-profit
organization organized on a national or provincial
basis".
The changes thus expanded the range of publi
cations entitled to second class mailing rates.
They, however, limited the range of persons eli
gible to avail themselves of these rates. This limi
tation was accomplished by the enactment of para
graphs (h) and (i).
It is no doubt arguable, as the applicant has
argued, that paragraph (h) is concerned only with
persons who engage in activities the preponderant
purpose of which is the making of profit. This
reading of the paragraph turns on interpreting
"principal business" as meaning, not simply "prin-
cipal activity", but "principal profit-making activi
ty". It would treat paragraph (h) as having to do
with persons who are engaged in such activities,
and paragraph (i) as having to do with persons
who are engaged in non-profit making activities,
and as having the effect of limiting the availability
of second class mail rates to some, but not all, of
them. The effect would be to bar persons who are
engaged in profit-making activities from the
advantage of second class mail registration if their
principal business is not publishing and if the
Canadian newspaper or periodical they seek to
register is published as an auxiliary to or for the
purpose of advancing the applicant's principal ac
tivity. The purpose of this paragraph on this view
would seem to be to deny special mail rates to a
person in business in the profit-making sense
where his principal business activity is not publish
ing, but is some other activity, for example, the
manufacture and sale of machinery or consumer
products, if the purpose of publication of the news
paper or periodical is simply to promote that activ
ity. This reading would leave open the possibility
of registering, as second class mail, Canadian
newspapers or periodicals falling within paragraph
(a), (b) or (c) if the person seeking registration
were not within paragraph (h) whatever might be
his principal activity. On this reading the purpose
of paragraph (i) would appear to be to limit the
associations mentioned in the paragraph (which
are generally speaking non-profit making in char
acter) to second class mailing rights for newspa
pers and periodicals covered by paragraphs (b)
and (c): an explanation might be that, given the
character of the association included in paragraph
(i), they would likely have limited publics whose
interests could adequately be served by the some
what specialized nature of periodicals included in
paragraphs (b) and (c) as compared with those
included in paragraph (a). This reading would,
nevertheless, have what appears to be the odd
consequence of limiting persons covered by para
graph (i) to registering periodicals falling within
paragraphs (b) and (c), while other persons not
engaged in profit-making activities could also reg
ister periodicals falling within paragraph (a).
There is, I think, a better reading of paragraph
(h), a reading which better serves the purpose of
the paragraph. The purpose of the paragraph, as I
see it, is to deny registration to a newspaper or
periodical, otherwise qualified, if the principal
business, in the sense of principal activity, of its
publisher is other than publishing. There is, how
ever, an exception. Even in such a case, the news
paper or periodical may be registered if it is pub
lished neither as an auxiliary to nor for the
purpose of advancing the publisher's principal ac
tivity. The use of the word "business" in the term
"principal business" has the effect of eliminating
from consideration, in determining the principal
activity of an applicant for registration, any activ
ity carried on by him which cannot be regarded as
a "business activity" in the broad sense in which
that term has been used in at least some of the
authorities I have referred to, the sense in which
"anything which is an occupation or duty which
requires attention ..." is regarded as a business.
Its use in the paragraph eliminates from consider
ation, in determining principal activity, such
activities of a publisher as would, in an ordinary
everyday sense, be considered, for example, as
recreational (see Customs and Excise Comrs v.
Lord Fisher, [1981] 2 All E.R. 147 (Q.B.D.)) or
as voluntary teaching carried on regularly under a
sense of social or moral obligation (see Abernethie
v. A.M. & J. Kleiman Ltd., [1970] 1 Q.B. 10
(C.A.)). Other examples are not difficult to
imagine.
This is the approach to the meaning of "busi-
ness" in the two cases I have just mentioned. I may
say I have found the Lord Fisher case particularly
helpful. There the taxpayer's main hobby was
pheasant shooting. He invariably invited friends
and relatives to join the shoots on his estate. The
invited guests made contributions to the costs of
the shoots, but the taxpayer did not carry on the
shoots for profit. The taxpayer was assessed a
value added tax in respect of the contributions on
the basis that they constituted consideration for
the supply of services in the course of a business
carried on . by the taxpayer. The tax tribunal
allowed an appeal from the assessment. The
Queen's Bench Division dismissed an appeal from
the tribunal's decision. Mr. Justice Gibson said at
page 159:
Lastly, Town Investments Ltd v Department of the Environ
ment [1977] 1 All ER 813 at 835, [1978] AC 359 at 402 was
the case from which came the second phrase set out in the first
indicium of counsel for the Crown: 'a serious occupation, not
necessarily confined to commercial or profit-making undertak
ings.' The case was concerned with the Counter-Inflation (Busi-
ness Rents) Order 1972, SI 1972 No 1850, in which restrictions
were imposed on increases of rent under business tenancies.
The definition of such a tenancy was similar to that under the
Landlord and Tenant Act 1954. A question in the case was
whether occupation and use of premises by government ser
vants for government purposes on behalf of the Crown con
stituted occupation for the purposes of a business carried on by
the Crown as tenant.
Lord Diplock referred to the word `business' as an etymologi
cal chameleon in that it suited its meaning to the context in
which it is found (see [1977] 1 All ER 813 at 819, [1978] AC•
359 at 383). He quoted Lindley U's dictum in Rolls y Miller
(1884) 27 Ch D 71 at 88, [1881-5] All ER Rep 915 at 920, in
which business was contrasted with pleasure, and which I have
already cited. Lord Diplock then proceeded to express the
conclusion that the meaning of the word `business' in the
definition of `business tenancy' in the two orders was no less
wide than that which it has been interpreted as having in
covenants in leases restricting the use of demised premises.
Lord Kilbrandon said ([1977] 1 All ER 813 at 835, [1978]
AC 359 at 402):
'As to the scope of the word "business" as defined in the
statute I would be content to accept the submission for the
department, namely that it denotes the carrying on of a
serious occupation, not necessarily confined to commercial or
profit-making undertakings.'
In my judgment, the words `serious occupation' in Lord
Kilbrandon's speech were not intended to include a hobby,
pleasure or pastime carried on by a man with no more serious
application and organisation than the nature of the activity
itself requires.
The conclusion which I have expressed that the true meaning
of the word `business' in the context of the 1972 Act excludes
any activity which is not more than an activity for pleasure and
social enjoyment does not mean that an activity carried on by a
taxable person cannot in law be a business if it is carried on by
him for pleasure and is one from which he derives social
enjoyment. It is not difficult, for example, to imagine circum
stances in which a man, controlling estates like those of the
taxpayer, would so organise his shooting activity that it would
rightly be regarded as a business. A long-standing love and
pursuit of the sport, and genuine delight in the society of other
people who shoot, and no doubt shoot well, could not by
themselves prevent the activity from being a `business' if in
other respects it is.
To summarize what I have said about the mean
ing of "business" as used in paragraph (h): the
amendments to the Post Office Act in 1968 (which
are contained in the Regulations) have, as I read
them, the purpose of expanding the range of news
papers and periodicals eligible for second class
mail, but also have the purpose of limiting the
right to apply for second class mail registration to
persons primarily engaged in publishing with, of
course, the important exceptions mentioned in
paragraph (h). The use of "business" in paragraph
(h) makes it clear that, in ascertaining whether a
publisher's principal activity is publishing, regard
should not be had to activities which, when regard
ed in a broad common sense way, cannot properly
be regarded as "business activities". It places this
practical limitation on the range of activities which
should be considered in seeking to determine the
principal activity of a publisher seeking registra
tion of a publication.
It could, I suppose, be suggested that the inten
tion was to leave second class mailing privileges
open to non-profit making enterprises as a means
of assisting them. I see nothing, however, in the
provisions to indicate such an intention. In fact, in
paragraph (c) the draftsman distinguished clearly
and in specific terms between profit making and
other activities when he intended to make the
distinction. I find it strange that he would not also
have done so in paragraph (h) if that had been the
purpose of the paragraph.
I agree with the Chairman that the use of the
term l'activité principale in the French version of
paragraph (h) gives support to a wide reading of
"principal business". On the other hand, the use of
"principal business" in the English version sug
gests that l'activité principale should be read in a
somewhat more restricted way than a literal read
ing might suggest. Each version of paragraph (h)
forms part of the context in which the other must
be read: see E. A. Driedger, Construction of Stat
utes, (2d ed., 1983), at page 165. When both
versions are read together, they do, I suggest,
support my sense of the significance of "principal
business" in paragraph (h).
The purpose of paragraph (i), as I read it, is to
make special provision for certain newspapers and
periodicals that might be barred from admission to
second class mail if paragraph (h) were left to
operate without exception. By virtue of paragraph
(i), a Canadian newspaper or periodical published
by or under the auspices of a fraternal, trade,
professional or other similar association (Consum-
ers' Association of Canada v. The Postmaster
General, [1975] F.C. 11 (C.A.)) or by a trade
union, credit union, cooperative, or local church
organization can be registered as second class mail
though publishing may not be the principal activ-
ity of the association, provided that the publication
is one described in paragraph (b) or (c).
For these reasons I would reject the applicant's
submission that the Chairman erred in law in
deciding that "business" is broad enough to
include the activities carried on by the Conference
Board. In particular, I am of opinion that the
Chairman did not err in deciding that the term
"business", as used in paragraph (h), is not limited
to profit-making activities. The activities of the
Conference Board are such as are capable of being
described as a business. These activities, including
research, communication, and the other services
provided by the Board to its members and others
are carried on by the Conference Board on a
day-to-day basis by a full-time staff in such a way
as to amount to the carrying on of an "occupation"
requiring continuing attention. In an information
brochure entitled The Conference Board in
Canada, this passage appears:
In order to provide the basic analytical content for its wide
range of services to Associates, the Conference Board employs
a large full-time staff of professional researchers in a variety of
disciplines. These individuals not only are engaged in original
research in areas of practical relevance to decision-makers in
all major facets of Canadian economic activity, but they also
are actively involved in disseminating their research findings to
Associates through the Board's publications and other informa
tion channels. For organizational purposes, the Board's
research staff and programs are divided into two groups—
economics and management. The resources available to Associ
ates through these two groups are described separately below.
I would also note that at least certain of the
publishing activities appear to have a commercial
aspect. The publication Consumer Markets
Update contains this announcement:
Consumer Markets Update is published quarterly by The
Conference Board of Canada and is distributed to all Associ
ates of the Board designated to receive the publication. It is
available to non-Associates of the Board on a subscription basis
at a rate of $50.00 per annum (4 issues).
A companion publication, the Survey of Consumer Buying
Intentions, provides detailed results of a regular survey of the
attitudes and buying plans of Canadian households. These
detailed survey results are available to both Associates and
non-Associates of The Conference Board of Canada on a
subscription basis. Direct inquiries to the Publications Informa
tion Centre of The Conference Board of Canada.
Having decided that the Conference Board is
engaged in a "business", reading that term in a
broad sense, the Chairman decided that publishing
is not its principal business, and also that the
publishing it does carry on is carried on as an
auxiliary to and for the purpose of advancing its
principal business. The Chairman's findings on
these points are contained in this passage appear
ing in his decision:
As to the question of "principal business", it seems to me that,
for present purposes, the principal business of the Board (to
paraphrase your own general description of its objects) may be
defined as follows:
L to conduct research; and
2. to communicate its findings to its members and others
through various means.
Publications are one of the ways in which the Board communi
cates its findings, but it is the communication of findings,
rather than publishing per se, that is the "principal business" of
the Board. Publishing is auxiliary to, or subsidiary to, the
"principal business" of communicating findings; it assists in the
advancement, or promotion, of that "primary business", but is
not itself the "primary business" of the Board. This deals with
the third question mentioned above.
The passage is not altogether clear. The Chair
man seems to be saying that the principal business
of the Conference Board is to conduct research,
and to communicate its findings to its members
and others using various means. But he also
appears to say that the "communication of find
ings" is the "principal business" of the Board.
I have found helpful, in determining the inten
tion of the Chairman in the quoted passage, a
submission made by the respondent in respect of
the "principal business" of the Conference Board.
The respondent submitted that it is clear from the
Board's own statements that "its principal business
is a combination of its two stated functions,
namely to conduct research and to communicate
its findings through various means." I think that
this is what the Chairman intended in the first full
sentence in the quoted passage. The respondent
also submitted: "The communications function is
carried out through a variety of different means,
including but not limited to, publishing." In my
view, this is what the Chairman meant by the
second sentence in the passage quoted, the sen
tence beginning with the words "Publications are
one of the ways ... ".
What the principal business of the Conference
Board is and whether, if its principal business is
not publishing, publishing is auxiliary to or for the
purpose of advancing the Board's principal busi
ness, are determinations of fact which we cannot
upset absent error of law. And the Chairman did
find, as I understand the passage in which he
expresses his findings, that publishing is not the
principal business of the Board, and that the pub
lishing it does is both auxiliary to and for the
purpose of advancing its principal business.
The applicant submitted that the Chairman
erred in law in making these findings. Counsel
submitted that, if the words "principal business"
apply to the applicant, publishing is an integral
part of that business. The submission was that, in
determining the Conference Board's "principal
business", "all of the constituent elements of its
undertaking that are integral to its operations
must be considered." The submission was that "An
integral part of a company's business is not a
separate business activity." In support, counsel
cited Minister of National Revenue v. Consolidat
ed Mogul Mines Limited, [1969] S.C.R. 54. In
that case, the taxpayer sought to deduct certain
expenses under what was then subsection 83A(3)
of the Income Tax Act [R.S.C. 1952, c. 148]. To
succeed, the taxpayer had to establish that its
principal business in the relevant tax years was
"mining or exploring for minerals". It succeeded
in doing so. Mr. Justice Spence said at pages 59
and 60:
Was that business, however, its principal business? Again
counsel for the Minister stressed the large investment portfolio
held by the respondent and submits that its principal business
was the management of that investment portfolio. It may be
said generally that although the source of the income of a
corporation is an important element to be considered in deter
mining which is its principal business it is not the only matter
to be considered and not necessarily the determinant factor. See
Cameron J. in American Metal Company v. M.N.R., supra, at
p. 307.
As the learned member of the Tax Appeal Board remarked:
So, it would appear to be reasonable to assume that the
multiplicity of arrangements which exist between mining
companies and the constant juggling of shareholdings for
various necessary purposes is just part and parcel of the
mining business. In my view, it shows lack of understanding
of the mining business to point to the financing arrangements
of a mining company as a separate business activity to that of
mining. Obviously, the financing function of a mining com
pany is an integral part of its business.
The applicant submitted that publishing is an
integral part of the Board's business, not a sepa
rate business activity. And so significant is pub
lishing, as an integral element of the business, that
publishing is in truth the business of the Board,
and thus is its "principal business". Publication of
the results of its research and analyses is, it was
said, the "raison d'être" of the Board. It was
submitted that "publications are the principal
means through which the findings of the Appli
cant's research and other activities in Canada is
[sic] made known and ... the Applicant has
become a major publisher."
The respondent submitted in response that "the
question of whether `publishing' is an integral part
of the Applicant's business or 'a separate activity'
is not germane for the purpose of defining 'princi-
pal business' " in paragraph 3.1(h). "A `business'
is typically made up of various constituent and
related activities as is the case with the Appli
cant." Paragraph 3.1(h) "however, requires a
determination of the principal business or activity
of the Applicant." I agree.
The applicant also submitted that the Chairman
erred in law in reaching the conclusion that pub
lishing is not the principal business of the Board
because he did not first examine and compare all
of the facts concerning each of the various types of
activity in which the Conference Board engages.
Counsel cited in support this passage from the
judgment of Mr. Justice Spence in the Con
solidated Mogul Mines Limited at page 57:
Cameron J. in American Metal Company of Canada Ltd. v.
Minister of National Revenue [1952] C.T.C. 302, in referring
to the words of the Statutes of Canada, 1947, c. 63, s. 16(4) "a
corporation whose chief business is that of mining or exploring
for minerals ...", said at p. 306:
"Chief business" is not defined in either of the Acts, and
the phrase, so far as I am aware, has not been the subject of
judicial interpretation. In my view, it is a question of fact to
be determined by an examination and comparison of all the
facts concerning each of the various types of business in
which the company is engaged.
The Chairman does not, it is true, examine in so
many words all of the facts which might be appro
priate to his determinations. I cannot, however,
assume that he did not in fact do so.
Counsel for the applicant also submitted that
the Chairman erred in law in deciding that pub
lishing is auxiliary to the principal business of the
Board. In support, he advanced the same reasons
as those he had advanced in support of his submis
sion that the Chairman erred in finding that pub
lishing is not the Board's principal business.
In respect of the applicant's challenge to these
findings of the Chairman, it is critical that, in the
words of Mr. Justice Cameron quoted by Mr.
Justice Spence in the Consolidated Mogul Mines
Limited case, the findings under challenge are
findings on questions of fact. The issue then is
whether there is material in the record on which
the Chairman could decide as he did. In my view,
there is. The respondent submitted that, in carry
ing out the function of communicating its research
findings, the applicant admitted to using non-pub
lishing as well as publishing means, "such as an
information service, an active conference and
seminar program, speaking engagements, on-line
computer systems, etc." There is material in the
record in support of this submission.
For all of these reasons, I would dismiss the
section 28 application.
URIE J.: I agree.
MAHONEY J.: I agree.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.