Provincial Court Judges' Assn. of New Brunswick v. New Brunswick (Minister of Justice); Ontario Judges' Assn. v. Ontario (Management Board); Bodner v. Alberta; Conférence des juges du Québec v. Quebec (Attorney General); Minc v. Quebec (Attorney General)

These appeals again raise the important question of judicial independence and the need to maintain independence both in fact and in public perception. Litigants who engage our judicial system should be in no doubt that they are before a judge who is demonstrably independent and is motivated only by a search for a just and principled result.

The concept of judicial independence has evolved over time. Indeed, “[c]onceptions have changed over the years as to what ideally may be required in the way of substance and procedure for securing judicial independence . . . . Opinions differ on what is necessary or desirable, or feasible”: Valente v. The Queen, [1985] 2 S.C.R. 673, at p. 692, per Le Dain J.

This evolution is evident in the context of judicial remuneration. In Valente, at p. 706, Le Dain J. held that what was essential was not that judges’ remuneration be established by an independent committee, but that a provincial court judge’s right to a salary be established by law. By 1997 this statement had proved to be incomplete and inadequate. In Reference re Remuneration of Judges of the Provincial Court of Prince Edward Island, [1997] 3 S.C.R. 3 (“Reference”), this Court held that independent commissions were required to improve the process designed to ensure judicial independence but that the commissions’ recommendations need not be binding. These commissions were intended to remove the amount of judges’ remuneration from the political sphere and to avoid confrontation between governments and the judiciary. The Reference has not provided the anticipated solution, and more is needed.

The basis for the principle of judicial independence can be found in both our common law and the Canadian Constitution; see Beauregard v. Canada, [1986] 2 S.C.R. 56, at pp. 70-73; Ell v. Alberta, [2003] 1 S.C.R. 857, 2003 SCC 35, at paras. 18-23. Judicial independence has been called “the lifeblood of constitutionalism in democratic societies” (Beauregard, at p. 70), and has been said to exist “for the benefit of the judged, not the judges” (Ell, at para. 29). Independence is necessary because of the judiciary’s role as protector of the Constitution and the fundamental values embodied in it, including the rule of law, fundamental justice, equality and preservation of the democratic process; Beauregard, at p. 70.

There are two dimensions to judicial independence, one individual and the other institutional. The individual dimension relates to the independence of a particular judge. The institutional dimension relates to the independence of the court the judge sits on. Both dimensions depend upon objective standards that protect the judiciary’s role: Valente, at p. 687; Beauregard, at p. 70; Ell, at para. 28.

The judiciary must both be and be seen to be independent. Public confidence depends on both these requirements being met: Valente, at p. 689. “Judicial independence serves not as an end in itself, but as a means to safeguard our constitutional order and to maintain public confidence in the administration of justice”: Ell, at para. 29.

The components of judicial independence are: security of tenure, administrative independence and financial security; see Valente, at pp. 694, 704 and 708; the Reference, at para. 115; Ell, at para. 28.

The Reference, at paras. 131-35, states that financial security embodies three requirements. First, judicial salaries can be maintained or changed only by recourse to an independent commission. Second, no negotiations are permitted between the judiciary and the government. Third, salaries may not fall below a minimum level.

The Reference arose when salaries of Provincial Court judges in Prince Edward Island were statutorily reduced as part of the government’s budget deficit reduction plan. Following this reduction, numerous accused challenged the constitutionality of their proceedings in Provincial Court alleging that the court had lost its status as an independent and impartial tribunal. Similar cases involving Provincial Court judges in other provinces were joined in the Reference. Prior to the Reference, salary review was between Provincial Court judges, or their association, and the appropriate minister of the provincial Crown. Inevitably, disagreements arose.

The often spirited wage negotiations and the resulting public rhetoric had the potential to deleteriously affect the public perception of judicial independence. However independent judges were in fact, the danger existed that the public might think they could be influenced either for or against the government because of issues arising from salary negotiations. The Reference reflected the goal of avoiding such confrontations. Lamer C.J.’s hope was to “depoliticize” the relationship by changing the methodology for determining judicial remuneration (para. 146).

Compensation commissions were expected to become the forum for discussion, review and recommendations on issues of judicial compensation. Although not binding, their recommendations, it was hoped, would lead to an effective resolution of salary and related issues. Courts would avoid setting the amount of judicial compensation, and provincial governments would avoid being accused of manipulating the courts for their own purposes.

Those were the hopes, but they remain unfulfilled. In some provinces and at the federal level, judicial commissions appear, so far, to be working satisfactorily. In other provinces, however, a pattern of routine dismissal of commission reports has resulted in litigation. Instead of diminishing friction between judges and governments, the result has been to exacerbate it. Direct negotiations no longer take place but have been replaced by litigation. These regrettable developments cast a dim light on all involved. In order to avoid future conflicts such as those at issue in the present case, the principles of the compensation commission process elaborated in the Reference must be clarified.

The principles stated in the Reference remain valid. The Reference focussed on three themes: the nature of compensation commissions and their recommendations; the obligation of the government to respond; and the scope of judicial review of the government’s response and the related remedies.

(1) The Nature of the Compensation Commission and Its Recommendations

The Reference laid the groundwork to ensure that provincial court judges are independent from governments by precluding salary negotiations between them and avoiding any arbitrary interference with judges’ remuneration. The commission process is an “institutional sieve” (Reference, at paras. 170, 185 and 189) — a structural separation between the government and the judiciary. The process is neither adjudicative interest arbitration nor judicial decision making. Its focus is on identifying the appropriate level of remuneration for the judicial office in question. All relevant issues may be addressed. The process is flexible and its purpose is not simply to “update” the previous commission’s report. However, in the absence of reasons to the contrary, the starting point should be the date of the previous commission’s report.

Each commission must make its assessment in its own context. However, this rule does not mean that each new compensation commission operates in a void, disregarding the work and recommendations of its predecessors. The reports of previous commissions and their outcomes form part of the background and context that a new compensation committee should consider. A new commission may very well decide that, in the circumstances, its predecessors conducted a thorough review of judicial compensation and that, in the absence of demonstrated change, only minor adjustments are necessary. If on the other hand, it considers that previous reports failed to set compensation and benefits at the appropriate level due to particular circumstances, the new commission may legitimately go beyond the findings of the previous commission, and after a careful review, make its own recommendations on that basis.

It is a constitutional requirement that commissions be independent, objective and effective. One requirement for independence is that commission members serve for a fixed term which may vary in length. Appointments to a commission are not entrusted exclusively to any one of the branches of government. The appointment process itself should be flexible. The commission’s composition is legislated but it must be representative of the parties.

The commission must objectively consider the submissions of all parties and any relevant factors identified in the enabling statute and regulations. Its recommendations must result from a fair and objective hearing. Its report must explain and justify its position.

A number of criteria that must be met to ensure effectiveness are identified in the Reference. Once the process has started, the commission must meet promptly and regularly. As well there must be no change in remuneration until the commission has made its report public and sent it to the government. The commission’s work must have a “meaningful effect” on the process of determining judicial remuneration (Reference, at para. 175).

What is a “meaningful effect”? Some of the appellants submit that “meaningful effect” means a binding effect on the government. A number of Attorneys General, by contrast, submit that “meaningful effect” requires a public and open process of recommendation and response. They urge that governments be permitted to depart from the report for a rational reason, but not to manipulate the judiciary. The essence of this appeal depends on whether “meaningful effect” means a binding effect or refers to an open process. For the reasons that follow, we conclude that it is the latter.

“Meaningful effect” does not mean binding effect. In the Reference, the Court addressed this question and stated that a recommendation could be effective without being binding. It held that the Constitution does not require that commission reports be binding, as decisions about the allocation of public resources belong to legislatures and to the executive (para. 176).

A commission’s report is consultative. The government may turn it into something more. Unless the legislature provides that the report is binding, the government retains the power to depart from the commission’s recommendations as long as it justifies its decision with rational reasons. These rational reasons must be included in the government’s response to the commission’s recommendations.

If the government departs from the commission’s recommendations, the Reference requires that it respond to the recommendations. Uncertainties about the nature and scope of the governments’ responses are the cause of this litigation. Absent statutory provisions to the contrary, the power to determine judicial compensation belongs to governments. That power, however, is not absolute.

The commission’s recommendations must be given weight. They have to be considered by the judiciary and the government. The government’s response must be complete, must respond to the recommendations themselves and must not simply reiterate earlier submissions that were made to and substantively addressed by the commission. The emphasis at this stage is on what the commission has recommended.

The response must be tailored to the commission’s recommendations and must be “legitimate” (Reference, at paras. 180-83), which is what the law, fair dealing and respect for the process require. The government must respond to the commission’s recommendations and give legitimate reasons for departing from or varying them.

The government can reject or vary the commission’s recommendations, provided that legitimate reasons are given. Reasons that are complete and that deal with the commission’s recommendations in a meaningful way will meet the standard of rationality. Legitimate reasons must be compatible with the common law and the Constitution. The government must deal with the issues at stake in good faith. Bald expressions of rejection or disapproval are inadequate. Instead, the reasons must show that the commission’s recommendations have been taken into account and must be based on facts and sound reasoning. They must state in what respect and to what extent they depart from the recommendations, articulating the grounds for rejection or variation. The reasons should reveal a consideration of the judicial office and an intention to deal with it appropriately. They must preclude any suggestion of attempting to manipulate the judiciary. The reasons must reflect the underlying public interest in having a commission process, being the depoliticization of the remuneration process and the need to preserve judicial independence.

The reasons must also rely upon a reasonable factual foundation. If different weights are given to relevant factors, this difference must be justified. Comparisons with public servants or with the private sector may be legitimate, but the use of a particular comparator must be explained. If a new fact or circumstance arises after the release of the commission’s report, the government may rely on that fact or circumstance in its reasons for varying the commission’s recommendations. It is also permissible for the government to analyse the impact of the recommendations and to verify the accuracy of information in the commission’s report.

The government’s reasons for departing from the commission’s recommendations, and the factual foundations that underlie those reasons, must be clearly and fully stated in the government’s response to the recommendations. If it is called upon to justify its decision in a court of law, the government may not advance reasons other than those mentioned in its response, though it may provide more detailed information with regard to the factual foundation it has relied upon, as will be explained below.

Once the commission has made its recommendations and the government has responded, it is hoped that, with the guidance of these reasons for judgment, the courts will rarely be involved. Judicial review must nonetheless be envisaged.

The Reference states that the government’s response is subject to a limited form of judicial review by the superior courts. The government’s decision to depart from the commission’s recommendations must be justified according to a standard of rationality. The standard of judicial review is described in the Reference as one of “simple rationality” (paras. 183-84). The adjective “simple” merely confirms that the standard is rationality alone.

The reviewing court is not asked to determine the adequacy of judicial remuneration. Instead, it must focus on the government’s response and on whether the purpose of the commission process has been achieved. This is a deferential review which acknowledges both the government’s unique position and accumulated expertise and its constitutional responsibility for management of the province’s financial affairs.

In the Reference, at para. 183, a two-stage analysis for determining the rationality of the government’s response is set out. We are now adding a third stage which requires the reviewing judge to view the matter globally and consider whether the overall purpose of the commission process has been met. The analysis should be as follows:

(1) Has the government articulated a legitimate reason for departing from the commission’s recommendations?

(2) Do the government’s reasons rely upon a reasonable factual foundation? and

(3) Viewed globally, has the commission process been respected and have the purposes of the commission — preserving judicial independence and depoliticizing the setting of judicial remuneration — been achieved?

The first stage of the process described in the Reference is a screening mechanism. It requires the government to provide a “legitimate” reason for any departure from the commission’s recommendation. What constitutes a “legitimate” reason is discussed above (paras. 23-27).

The second stage of the review consists of an inquiry into the reasonableness and sufficiency of the factual foundation relied upon by the government in rejecting or varying the commission’s recommendations. The Reference states that this inquiry is to be conducted in a manner similar to the Court’s assessment of the “economic emergency” in Reference re Anti-Inflation Act, [1976] 2 S.C.R. 373 (“Anti-Inflation Reference”).

Lamer C.J.’s mention of the Anti-Inflation Reference must be read in context. His statement was not meant to incorporate the circumstances of that case (i.e., an emergency) and, hence, does not require that the legislature or the executive establish the existence of “exceptional circumstances” in order to justify a departure from the recommendations. What Lamer C.J. intended was that a reviewing court is to assess the factual foundation relied upon by the government in a manner similar to how this Court, in the Anti-Inflation Reference, assessed whether there were “exceptional circumstances” that provided a rational basis for the government’s legislation under the “peace, order and good government” head of power.

In the Anti-Inflation Reference, the analysis focussed on two factors: first, whether the government had indicated that this was the factual basis upon which it was enacting the legislation and, second, whether on the face of the evidence before the Court, it was rational for the government to rely on such facts. The analysis required a deferential standard; see p. 423, per Laskin C.J.:

In considering such material and assessing its weight, the Court does not look at it in terms of whether it provides proof of the exceptional circumstances as a matter of fact. The matter concerns social and economic policy and hence governmental and legislative judgment. It may be that the existence of exceptional circumstances is so notorious as to enable the Court, of its own motion, to take judicial notice of them without reliance on extrinsic material to inform it. Where this is not so evident, the extrinsic material need go only so far as to persuade the Court that there is a rational basis for the legislation which it is attributing to the head of power invoked in this case in support of its validity.

In analysing these two factors as part of the second stage of the judicial review process, the reviewing court must determine whether the government has explained the factual foundation of its reasons in its response. Absent new facts or circumstances, as a general rule, it is too late to remedy that foundation in the government’s response before the reviewing court. Nevertheless, the government may be permitted to expand on the factual foundation contained in its response by providing details, in the form of affidavits, relating to economic and actuarial data and calculations. Furthermore, affidavits containing evidence of good faith and commitment to the process, such as information relating to the government’s study of the impact of the commission’s recommendations, may also be admissible.

The reviewing court should also, following the Anti-Inflation Reference, determine whether it is rational for the government to rely on the stated facts or circumstances to justify its response. This is done by looking at the soundness of the facts in relation to the position the government has adopted in its response.

At the third stage, the court must consider the response from a global perspective. Beyond the specific issues, it must weigh the whole of the process and the response in order to determine whether they demonstrate that the government has engaged in a meaningful way with the process of the commission and has given a rational answer to its recommendations. Although it may find fault with certain aspects of the process followed by the government or with some particular responses or lack of answer, the court must weigh and assess the government’s participation in the process and its response in order to determine whether the response, viewed in its entirety, is impermissibly flawed even after the proper degree of deference is shown to the government’s opinion on the issues. The focus shifts to the totality of the process and of the response.

It is obvious that, on the basis of the test elaborated above, a bald expression of disagreement with a recommendation of the commission, or a mere assertion that judges’ current salaries are “adequate”, would be insufficient. It is impossible to draft a complete code for governments, and reliance has to be placed on their good faith. However, a careful application of the rationality standard dispenses with many of the rules that have dominated the discourse about the standard since the Reference. The test also dispenses with the “rules” against other methods for rejecting a commission’s recommendations, such as prohibiting the reweighing of factors previously considered by the commission. The response can reweigh factors the commission has already considered as long as legitimate reasons are given for doing so. The focus is on whether the government has responded to the commission’s recommendations with legitimate reasons that have a reasonable factual foundation.

In a judicial review context, the court must bear in mind that the commission process is flexible and that, while the commission’s recommendations can be rejected only for legitimate reasons, deference must be shown to the government’s response since the recommendations are not binding. If, in the end, the reviewing court concludes that the response does not meet the standard, a violation of the principles of judicial independence will have been made out.

In the Reference, Lamer C.J. briefly commented in passing on the justification under s. 1 of the Canadian Charter of Rights and Freedoms (paras. 277-85). Since the parties have not raised this issue in the case at bar, consideration of it, if it is indeed applicable, should await the proper case. We will now consider the remedies that are available in cases in which the constitutional standard is not met.

The limited nature of judicial review dictates the choice of remedies. The remedies must be consistent with the role of the reviewing court and the purpose of the commission process. The court must not encroach upon the commission’s role of reviewing the facts and making recommendations. Nor may it encroach upon the provincial legislature’s exclusive jurisdiction to allocate funds from the public purse and set judicial salaries unless that jurisdiction is delegated to the commission.

A court should not intervene every time a particular reason is questionable, especially when others are rational and correct. To do so would invite litigation, conflict and delay. This is antithetical to the object of the commission process. If, viewed globally, it appears that the commission process has been effective and that the setting of judicial remuneration has been “depoliticized”, then the government’s choice should stand.

In light of these principles, if the commission process has not been effective, and the setting of judicial remuneration has not been “depoliticized”, then the appropriate remedy will generally be to return the matter to the government for reconsideration. If problems can be traced to the commission, the matter can be referred back to it. Should the commission no longer be active, the government would be obliged to appoint a new one to resolve the problems. Courts should avoid issuing specific orders to make the recommendations binding unless the governing statutory scheme gives them that option. This reflects the conclusion in Mackin v. New Brunswick (Minister of Finance), [2002] 1 S.C.R. 405, 2002 SCC 13, that it is “not appropriate for this Court to dictate the approach that should be taken in order to rectify the situation. Since there is more than one way to do so, it is the government’s task to determine which approach it prefers” (para. 77).

Provincial Court judges in New Brunswick, Ontario and Quebec, justices of the peace in Alberta and municipal court judges in Quebec have sought judicial review of their provincial governments’ decisions to reject certain compensation commission recommendations relating to their salaries and benefits. We will apply the principles set out above to the facts of each of these cases.

Before the Reference, the Government of New Brunswick negotiated directly with Provincial Court judges. Although these negotiations led to salary changes in some years, the judges’ salary was usually treated on the same basis as the salaries of non‑bargaining civil service employees, notably those of senior civil servants. After the Reference, the New Brunswick legislature amended the province’s Provincial Court Act, R.S.N.B. 1973, c. P-21, in order to establish the process recommended by our Court (s. 22.03(1)). The new legislation sets out the factors to be considered by the Commission in making its recommendations:

22.03(6) In making its report and recommendations, the Commission shall consider the following factors:

(a) the adequacy of judges’ remuneration having regard to the cost of living or changes in real per capita income,

(a.1) the remuneration of other members of the judiciary in Canada as well as the factors which may justify the existence of differences between the remuneration of judges and that of other members of the judiciary in Canada,

(b) economic fairness, including the remuneration of other persons paid out of the Consolidated Fund,

(c) the economic conditions of the Province, and

(d) any other factors the Commission considers relevant to its review.

These factors now provide the basis for the assessment that is to be conducted by New Brunswick’s judicial remuneration commissions.

When the first commission was appointed in 1998, the salary of New Brunswick’s Provincial Court judges was $100,000. In its representations to the 1998 Commission, the Provincial Court Judges’ Association of New Brunswick (“Association”) submitted that an increase was justified in view of its members’ increased workload resulting from a number of legislative changes. It maintained that their work was as important as the work of judges of the Court of Queen’s Bench and consequently asked that they receive the same remuneration. The 1998 Commission recommended salary increases to $125,000 as of April 1, 1998 and to approximately $142,000 in 2000. It relied on two principal factors: “both the nature of the work and the workload of Provincial Court judges have changed dramatically” and “the current salary and benefits paid to a Provincial Court judge in New Brunswick is insufficient to attract the number and quality of candidates which is appropriate for the Court”. The Commission mentioned the salary of federally appointed judges, but only for purposes of comparison with the salary of Provincial Court judges.

In its response to the 1998 Commission’s report, the Government accepted only the $25,000 increase. However, the salary was further increased to the recommended level on October 27, 2000, just a few months before the appointment of the 2001 Commission.

By an Order in Council published on February 14, 2001, the Government appointed the members of a commission whose term would end on December 31, 2003. The Association renewed the argument based on a comparison with other provincial court judges and a link with federally appointed judges. It again relied on the increase in the number, length and complexity of the cases its members decide. The Government took the position that the remuneration of Provincial Court judges was fair and that it was sufficient to attract qualified candidates. It asserted that since the last increase, there had been no changes that would justify another increase of the judges’ compensation. The Government provided the Commission with indexes, information on economic factors in New Brunswick and salary trends in the public sector, and comparisons with other judges in Canada. It specifically rejected parity with federally appointed judges.

In its report, the 2001 Commission mentioned the judges’ increased workload. It noted that the Government had not given any indication of being in financial difficulty and highlighted increases granted to public service employees in excess of the wage restraint policy. It dealt expressly with the parity argument. The following extract from the report reflects the gist of the justification for the recommendation on salary:

Without wishing to debate the merits of the development of the court system over the past 300 years, the Commission feels that the wage difference between PCJ and members of the Court of Queen’s Bench cannot be ignored.

The only persons, in fact, whose job and method of appointment are similar to the PCJ in New Brunswick are judges of the Court of Queen’s Bench.

However, recognising this is different from insisting either on parity with the salaries or in establishing some lock-step arrangement which would keep PCJ remuneration at a constant percentage, either above or below Court of Queen’s Bench salaries.

. . .

In their submission, the Province notes that since the PCJ received a 40% increase within the last six months or so, there is no reason to consider a further increase.

The effect that this would be to freeze the salaries of PCJ for three years, except, presumably, for a cost-of-living adjustment which all employees get.

The reason that this large increase occurred when it did, was that the Province did not pay what the last Commission recommended.

. . .

It is the view of this Commission that the suggestion made by the Province that nothing be paid for a further three years would be in violation of the Supreme Court ruling.

. . .

According to figures contained in the submission of the Province to this Commission, New Brunswick reported personal income per capita in 1999 equal to 85% of the Canadian average.

Considering these factors and the prospect of salaries of Judges of the Queen’s Bench rising to just over $200,000, and continuing to rise by about $2,000, it is proposed that PCJ receive 8% in the first year and a further 5% in the succeeding two years to keep them in reasonable relationship to judges of the Court of Queen’s Bench.

This would result in an annual salary as follows, beginning January 1, 2001 and effective on the same date in the succeeding two years:

2001 – $154,018

2002 – $161,709

2003 – $169,805

In addition, the Commission recommends that the Province apply to these annual salary amounts, the New Brunswick Industrial Aggregate Index. . . .

In this third year, the annual salaries of PCJ would be approximately $30,000 less than the salaries of judges of the Court of Queen’s Bench, and marginally lower than the percentage that New Brunswick’s personal income per capita was in 1999 of the national average.

The Commission also made a number of recommendations with respect to pensions, vacations, health care and life insurance.

The Government rejected all the Commission’s recommendations with regard to remuneration except for the increase based on the province’s Industrial Aggregate Index. The Government’s response took the form of recitals, which are reproduced in the appendix and will be dealt with at greater length below. These 29 recitals can be condensed into three main reasons: in the Government’s view, (1) the Commission misunderstood its mandate, (2) it is inappropriate to link the Provincial Court judges’ salary to that of federally appointed judges, and (3) the judges’ existing salary is adequate.

The reviewing judge found the Government’s reasons for rejecting the Commission’s salary recommendations to be rational, but held that its reasons for rejecting the recommendations relating to pensions and benefits were not ((2002), 249 N.B.R. (2d) 275). The recommendations relating to vacations, pensions and health benefits were declared to be binding upon the Government.

The reviewing judge stressed that the review process should focus on the reasons set out in the Government’s response rather than on the adequacy of the Commission’s recommendations: “I note parenthetically that this court is not called upon to determine whether or not the recommendations of the 2001 Commission are adequate, insufficient or over generous. Rather, the role of this court is simply to determine if the government has justified its decision according to the criterion which was set by the Supreme Court of Canada in the P.E.I. Reference” (para. 20). He considered that the question he had to answer was whether judicial independence had been preserved despite the Government’s rejection of the recommended raise: “. . . would a reasonable person, appearing before the Provincial Court, fear that he or she is not being heard by an independent tribunal because the government of this Province declined to raise the presiding judge’s salary from $141,206 to $169,805 by this time next year? I would have to answer ‘no’ to the question” (para. 52).

In considering whether judicial independence had been preserved, the judge looked at the proposed increases through the lens of the reasonable person standard. This led him to focus on a quantitative evaluation to determine whether judicial independence was threatened. The Provincial Court judges appealed to the Court of Appeal. The Government did not appeal the order relating to pensions and benefits.

The Court of Appeal stated that the Commission’s mandate was to insulate the process from political interference and to depoliticize the determination of changes to remuneration ((2003), 260 N.B.R. (2d) 201, 2003 NBCA 54, at para. 60). It stressed that the Commission’s responsibility was to make recommendations as to the appropriate compensation for judges based on the relevant factors (para. 69). The court distanced itself from a standard of deference to the Commission. It instead referred to a need to defer to the Government’s response: “In conclusion, the simple rationality test requires deference to the government’s factual justification for its rejection decision” (para. 113). The court criticized the Government for relying in its response on economic constraints that had not been raised in its submissions to the Commission. It also faulted the Government for insisting that the salary was adequate but said that this failing could be explained by a weakness in the Commission’s report:

The Government insists that the present salary level is adequate in the sense that there has been no material change in circumstances since implementation of the 40% salary increase recommended by the 1998 Commission: see Recital 1. In my view, this bald assertion fails the simple rationality test. For example, the Government does not deal with the fact that the salaries of other provincial and federal judges have risen since implementation of the 1998 Commission’s salary recommendation. That being said, I must confess that the manner in which the Commission disposed of this argument is flawed. [para. 138]

The Court of Appeal then identified major problems in the Commission’s report, and in particular its conclusion that to deny an increase would be in violation of the Reference. The court stressed that the Government could have identified the Commission’s errors in law in its response (para. 141). It noted that such errors might have been avoided had the Commission been provided with independent legal counsel to assist the lay tribunal in its deliberations. The Court of Appeal also addressed the Government’s contention that the recommended salary increase is excessive, particularly when compared with the increases received by civil servants. It concluded that the comparison was inappropriate and that the response, in this regard, failed to meet the standard of rationality. It then reviewed the argument based on parity with federally appointed judges and found that the Government was right to reject the link between the salary of federally appointed judges and that of Provincial Court judges. At this point, the court conducted its own analysis to determine whether the salary was sufficient to attract qualified candidates. It concluded that the Government’s position met the rationality standard and that it could be reasserted in the response because the Commission had not dealt with it properly.

Having concluded that two cogent reasons had been advanced for refusing to implement the Commission’s report, namely the rejection of parity and the ability to attract qualified candidates, the Court of Appeal found that the reasons met the rationality standard and dismissed the appeal. The Association appealed to this Court.

For the reasons that follow, the appeal should be dismissed. The justifications for rejecting the 2001 Commission’s recommendations given by the Government in its response to the Commission’s report meet the rationality standard. To explain this conclusion, the Government’s response will be reviewed in light of the principles set out above. The questions are: first, whether the response contains legitimate reasons based on the public interest; second, whether it is based on a sufficient factual foundation; and finally, whether the Government’s reasons, viewed globally, show that the purposes of the commission process have been achieved. But before turning to the analysis of the Government’s response, a preliminary issue must be addressed — namely the admissibility of affidavits submitted by the Government at the trial level in support of its response to the Commission’s report.

(2) Admissibility of Affidavits

In the Court of Queen’s Bench, the Government sought to have four affidavits admitted. In one, Bryan Whitfield, the Senior Policy Advisor in the Department of Justice’s Research and Planning Branch, detailed his estimate of the costs arising from the implementation of the Commission’s recommendations. In a second affidavit, Conrad Ferguson, an actuary in private practice, provided the annual cost of the judges’ salary and benefits at various salary levels. Next, James Turgeon, the Executive Director of the Department of Finance’s Economic and Fiscal Policy Division, outlined the economic conditions in the province. Finally, Lori Anne McCracken, an employee of the Government’s office of Human Resources, addressed salary increases granted within the civil service.

The appellants contested the admissibility of the Government’s four affidavits, arguing that they advanced additional evidence and new reasons for rejecting the Commission’s salary recommendations. The reviewing judge admitted the affidavits in the record. The Court of Appeal reversed the lower court’s decision and held that the affidavits were not admissible on the basis that they introduced evidence and facts not contained in the Government’s response.

In the Reference, this Court stated that the government’s response must be complete. In other words, all the reasons upon which the government relies in rejecting the commission’s recommendations must be stated in its public response. As a result, once the matter is before the reviewing court, it is too late for the government to bolster its response by including justifications and reasons not previously mentioned in the response.

This is not to say that the government’s response must set out and refer to all the particulars upon which its stated reasons are based. The objective of an open and transparent public process would not be furthered if governments were required to answer commission recommendations by, for example, producing volumes of economic and actuarial data. It is enough that the government’s reasons provide a response to the commission’s recommendations that is sufficient to inform the public, members of the legislature and the reviewing court of the facts on which the government’s decision is based and to show them that the process has been taken seriously.

In the present case, the affidavits do not advance arguments that were not previously raised by the Government in its submissions to the Commission; nor do they add to the reasons given in the Government’s response. They simply go into the specifics of the factual foundation relied upon by the Government. They show how calculations were made and what data were available. They contribute to showing the consideration given to the recommendation. This is permissible, and the documents are admissible.

As has already been mentioned, the Government’s response points to three reasons for rejecting the recommendations. Those reasons will now be analysed through the prism of the test elaborated above. The first reason given by the Government is that the Commission misunderstood its mandate. The Government takes the position that, when making salary recommendations, the Commission’s primary purpose is to ensure that compensation levels do not fall below the adequate minimum required to guarantee judicial independence. Second, the Government considers the recommended raise to be excessive because it fails to take account of economic conditions in New Brunswick and is instead based on a desire to maintain partial parity with federally appointed judges. Third, the Government states that the judges’ existing salary is adequate. In making this assertion, it relies on indexes and economic data and on the ability to attract qualified candidates with the existing salary. It takes the position that an increase based on inflation would be sufficient to maintain the adequacy of the judges’ remuneration.

The first stage of the analysis consists of screening the government’s reasons to determine if they are legitimate. This is done by ascertaining whether the reasons are simply bald rejections or whether they are guided by the public interest, and by ensuring that they are not based on purely political considerations.

The Government’s questioning and reformulation of the Commission’s mandate are inadequate. As we have already mentioned and as the Court of Appeal correctly pointed out, the Commission’s purpose is to depoliticize the remuneration process and to avoid direct confrontation between the Government and the judiciary. Therefore, the Commission’s mandate cannot, as the Government asserts, be viewed as being to protect against a reduction of judges’ salaries below the adequate minimum required to guarantee judicial independence. The Commission’s aim is neither to determine the minimum remuneration nor to achieve maximal conditions. Its role is to recommend an appropriate level of remuneration. The Government’s questioning of the Commission’s mandate is misguided and its assertion regarding the Commission’s role is incorrect. The part of the response in which the Government questions the Commission’s mandate is not legitimate. It does nothing to further the public interest and accordingly fails at the first stage of the analysis.

However, the Government’s reasons relating to the adequacy of the judges’ existing salary and the excessiveness of the recommended raise cannot be characterized, at the first stage of the analysis, as being purely political or as an attempt to avoid the process. Furthermore, there is no suggestion that the Government has attempted to manipulate the judiciary. As for the reasons relating to the appropriateness of the salary recommendations, although some of the recitals may seem dismissive of the process, the reviewing judge was on the whole right to conclude at the first stage (at para. 58):

By declining to accept the 2001 Commission’s salary recommendation, there is no evidence that the executive intended to manipulate the bench or politically interfere with it. There is no indication that the government’s policy of fiscal restraints constituted measures directed at judges alone. There is no suggestion that the refusal to grant a salary increase amounts to unscrupulous measures whereby the provincial government utilized “its authority to set judges’ salaries as a vehicle to influence the course and outcome of adjudication” (P.E.I. Reference, at para. 145).

Since the portion of the Government’s response relating to the adequacy of the judges’ existing salary and the excessiveness of the recommended raise is legitimate, the reasons given must be examined further to determine if they rely upon a sufficient factual foundation. This second stage of the rationality test requires the court to determine, first, whether the government has set out sufficient facts to support its reasons for rejecting the recommendations on remuneration and, second, whether it is rational for the government to rely on the stated facts to justify its response.

The two justifications raised by the Government must be addressed separately — after all, the excessiveness of a recommended salary increase is not necessarily commensurate with the appropriateness of the judges’ existing salary. However, the facts relied upon by the Government in support of both these justifications can be examined together insofar as the evidence adduced by the Government to show that the recommended increase is excessive supports, to some extent at least, its contention that the remuneration is adequate.

The Government objected to the salary increase because it believed that in granting an increase of this magnitude, the Commission was in fact giving effect to the Provincial Court judges’ argument that they should be granted parity or partial parity. Even though the Commission explicitly stated that it did not accept the parity argument, there is, in reality, an obvious connection between the recommended increase and the salary of federally appointed judges that transcends the report: the recommended increase would result in the judges’ salary equalling 85 percent of the salary of federally appointed judges. This figure corresponds to the Government’s submission, mentioned by the Commission in its report, that the average per capita income in New Brunswick is equal to 85 percent of the Canadian average. This would account for the figure, not otherwise explained, chosen by the Commission for the recommended increase. The Court of Appeal correctly highlighted the facts relied on by the Government and the weakness of the Commission’s report in this regard (at para. 159):

Historically, federal judicial remuneration commissions have consistently accepted that the federal salary should be uniform and, with one exception, not reflect geographic differences. Additionally, federal commissions have consistently recognized that the uniform salary must be set at a level that is capable of attracting highly qualified candidates. This factor is problematic with respect to potential applicants practising law in Canada’s larger metropolitan centres. Their incomes and salary expectations are understandably greater than those practising in smaller communities. Rather than recommending a salary differential based on the geographic location of a judge’s residence, federal commissions have concluded that the salary level must be set at a level which does not have a chilling effect on recruitment in the largest metropolitan areas of the country. For this reason, the recommended federal salary is adjusted to reflect this geographic disparity.

The role of the reviewing court is not to second-guess the appropriateness of the increase recommended by the Commission. It can, however, consider the fact that the salaries of federally appointed judges are based on economic conditions and lawyers’ earnings in major Canadian cities, which differ from those in New Brunswick. As a result, while the Commission can consider the remuneration of federally appointed judges as a factor when making its recommendations, this factor alone cannot be determinative. In fact, s. 22.03(6)(a.1) of the Provincial Court Act requires the Commission to consider factors which may justify the existence of differences between the remuneration of Provincial Court judges and that of other members of the judiciary in Canada, yet the Commission chose not to address this. Moreover, it is inappropriate to determine the remuneration of Provincial Court judges in New Brunswick by applying the percentage ratio of average incomes in New Brunswick to those in Canada to the salary of federally appointed judges, because the salary of federally appointed judges is based on lawyers’ earnings in major Canadian cities, not the average Canadian income.

The Government also asserts that economic conditions in the province do not support the salary increase of 49.24 percent between 1990 and 2000, which rises to 68.16 percent when combined with the recommended increase for 2001. In its view this increase far exceeds changes in economic indicators in New Brunswick. The Government compares the increase to the 18.93 percent increase granted to senior civil servants between 1990 and 2000. It relies on the fact that the recommendation would give New Brunswick’s judges the third highest salary among provincial court judges in the country after their counterparts in Ontario and Alberta, while the average earner in New Brunswick is ranked eighth out of ten. The economic data on which the Government relies were set out in its representations to the Commission, but the Commission did not discuss them. The calculation of the value of the recommended increase was included in the affidavits that it sought to have admitted.

Except for the reason relating to the Commission’s failure to cost its recommendations, the arguments raised in the Government’s response may at first glance appear to be a restatement of its position before the Commission. However, as a result of two particular circumstances, the Government can rely on them. First, the Commission did not discuss the data set out in the Government’s representations and, second, the report did not explain how economic fairness and economic conditions in the province had been taken into consideration, even though these are two important factors that the Provincial Court Act requires the Commission to consider. The deficiencies of the Commission’s report are such that the Government cannot be prevented from relying on a relevant factual foundation, not even one that was included in the representations it made to the Commission.

In its response, the Government correctly points to several facts that legitimately support its position that the increase is excessive, namely, the fact that the recommendations are not based on economic conditions in New Brunswick but correspond to a percentage of the salary of federally appointed judges; the fact that such a raise would constitute preferential treatment in comparison with the raises received by senior civil servants in New Brunswick and most other provincial court judges in Canada; and finally, the fact that the increase would far exceed changes in economic indicators since the 1998 recommendations were implemented. Accordingly, the Government can legitimately refuse to implement the recommended salary increase on the ground that it is excessive.

In rejecting the Commission’s salary recommendations, the Government also relies on its assessment that the judges’ existing salary is adequate. This argument also formed part of the Government’s submissions to the 2001 Commission. In its report, however, the Commission dismissed this argument on the ground that to accept it would lead to a salary freeze in violation of the principles stated in the Reference. In taking this position, the Commission committed an error of law. The Reference did not make salary increases mandatory. Consequently, the Government was justified in restating its position that the existing salary was adequate insofar as it relied on a reasonable factual foundation.

In its response, the Government relies on three facts in support of this assertion: that nothing has changed since the recommendations of the 1998 Commission that would warrant a further increase, that the existing remuneration is sufficient to attract qualified candidates, and that judges are currently in the top 5 percent of wage earners in New Brunswick. We will deal with each of these facts in turn.

The 2001 Commission rejected the Government’s argument that nothing had occurred since the salary increase granted a few months before the Commission was appointed. It faulted the Government for having delayed implementation of the previous commission’s salary recommendations. In these circumstances, if the Government’s stance on the adequacy of remuneration can be said to have a reasonable factual foundation, it is not because of its reliance upon the fact that nothing has changed since the last increase.

The Government also states in its response that the judges’ existing salary is adequate because it is sufficient to attract a number of qualified candidates for appointment to the bench. The Commission did not assess this argument or the facts in support of it, except to say that Provincial Court judges are chosen from the same pool of lawyers as Court of Queen’s Bench judges. The figure of 50 qualified candidates advanced by the Government was questioned at one point, but the Court of Appeal found that there were at least 30, thus showing that the salary, in combination with the pension plan, was sufficient to attract qualified candidates. The Court of Appeal correctly found that the Commission’s report did not adequately address the Government’s position. The Government’s reliance on this factual foundation is reasonable.

Finally, the Government’s argument that the salary increase should be rejected because judges are currently among the top 5 percent of the province’s wage earners bears little weight in itself. This information is meaningless because salaries in the group in question may vary widely. The reference to the top 5 percent of the province’s wage earners can be traced to the Government’s submissions to the 2001 Commission, in which it stated that the average salary in this category is approximately $92,000. That amount is less than the salary earned by the judges even before the 1998 Commission started its process. As the Court of Appeal stated, now is not the time to rewind the clock.

In conclusion, the Government’s response cannot be struck down for lack of a reasonable factual foundation. While some parts of the Government’s response may appear dismissive, others have a rational basis. On the one hand, the Government’s rejection of the recommended increase on the basis that it is excessive is amply supported by a reasonable factual foundation. On the other hand, the arguments in support of the status quo were not properly dealt with by the Commission. The Commission also failed to adequately address the Association’s submissions in support of a reasonable increase, namely those relating to the judges’ increased workload and to the salaries of provincial court judges in other jurisdictions. These omissions may have occurred because the parity argument advanced by the Association had blurred the Commission’s focus.

This being said, a reviewing court cannot substitute itself for the Commission and cannot proceed to determine the appropriate salary where the Commission has neglected to do so. However, deference should not undermine the process. Whereas a commission’s report can normally be relied upon by a subsequent commission to have set an appropriate level of compensation, in certain circumstances, such as where the earlier commission neglected to consider all the criteria enumerated in the Provincial Court Act or where it encountered constraints preventing it from giving full effect to one or more criteria, the subsequent commission may reconsider the earlier commission’s findings or recommendations when conducting its own review. This may be one such case in which a future commission will have greater latitude than it would otherwise have had.

At the third stage of the rationality analysis, the government’s reasons must be examined globally in order to determine whether the purposes of the commission process have been achieved. The Government’s justification for its departure from the Commission’s recommendations is unsatisfactory in several respects. However, at this stage, the response must be viewed globally and with deference. From this perspective, the response shows that the Government took the process seriously. In some respects, it had to rely on the representations it had made to the Commission, since the Commission had failed to deal with them properly. Thus, the Government has participated actively in the process and it must be shown greater deference than if it had ignored the process.

Overall, the analysis shows that the principles of the Reference have been respected and that the criticisms of the Government’s response were properly dismissed.

For these reasons, the appeal is dismissed with disbursement costs to the respondent, as requested by the latter.

The Ontario Judges’ Association, the Ontario Family Law Judges’ Association and the Ontario Provincial Court (Civil Division) Judges’ Association (together “Judges”) are the appellants in this appeal. Her Majesty the Queen in Right of the Province of Ontario, as represented by the Chair of Management Board (“Ontario”) is the respondent.

Under the statutory regime in Ontario, a commission’s salary recommendations are binding on the government. However, the commission’s pension recommendations are not. This case involves pension recommendations. For the reasons that follow, the appeal is dismissed.

(1) Background

The Fourth Triennial Provincial Judges Remuneration Commission (1998-2001) (“Commission”) was established by Appendix A of the Framework Agreement set out in the Schedule to the Courts of Justice Act, R.S.O. 1990, c. C.43. The Framework Agreement sets out the jurisdiction and terms of reference of each triennial commission. Before the Commission, the Judges sought higher salaries and a better pension. In particular, they sought to reduce the disparity between federally and provincially appointed judges. Ontario submitted before the Commission that salary and benefits should not be increased. It also argued that the Judges’ salaries, pensions and benefits were at a fair and appropriate level.

The Commission recommended a salary increase of approximately 28 percent over three years. This recommendation was binding in Ontario by virtue of the Framework Agreement. The majority of the Commission also set out three optional pension recommendations. These were (1) to increase the provincial Judges’ pension plan to the level of the federal judges’ plan; (2) to change to a 20-year accrual rate of 3.3 percent so that after 20 years of service a provincial judge could retire at 65 years of age with a pension of 66 2/3 percent of his salary at the date of retirement; or (3) to provide an across-the-board pension benefit increase of 10 percent. The majority also recommended that Ontario consider either (1) adopting a “Rule of 80” that would entitle a judge to retire with a full pension any time after his or her age plus years of service equalled 80; or (2) reducing the early retirement penalties.

The Commission did not retain actuaries to cost out its pension recommendations in light of the 28 percent salary increase. The only costings referred to in the Commission’s report involved the estimated costs of the pension enhancements and were done before the salary increase was taken into account. The minority of the Commission did not support the pension recommendations.

In order to consider the Commission’s optional pension recommendations, Ontario retained PricewaterhouseCoopers (“PwC”) to determine the cost. Ontario ultimately concluded that the 28 percent salary increase, which in turn automatically increased the value of the pension by 28 percent, was sufficient. It refused to adopt any of the pension recommendations. On February 1, 2000, Ontario sent its response to the chair of the Commission. It listed seven reasons why it was not implementing the pension recommendations, including the fact that the current pension entitlements were appropriate and their value had already increased as a result of the salary increase awarded by the Commission (i.e., 28 percent). However, Ontario’s reasons for rejecting the Commission’s recommendations made no reference to it having retained PwC or to any alleged error or incompleteness in costings made by the Commission.

The Judges applied for judicial review. In support of its position, Ontario filed affidavits from Owen M. O’Neil of PwC detailing PwC’s work for the Government. The Judges objected to Ontario’s retention of PwC. They also objected to the admissibility of the affidavits. They accused Ontario of engaging in a “Unilateral and Secretive Post-Commission Process”. They argued that this rendered the commission process ineffective. Evidently, the parties disagreed on the real purpose of the PwC retainer.

(a) Ontario Superior Court of Justice (Divisional Court) ((2002), 58 O.R. (3d) 186)

The Ontario Divisional Court dismissed the Judges’ application. It held that the affidavit evidence respecting the PwC costing was admissible because, according to the Reference, a government is entitled to “justify its decision in a court of law”. The court considered the Reference and concluded that Ontario’s reasons for rejecting the pension recommendations were clear, logical, relevant and consistent with the position taken before the Commission. There was no evidence that the decision was purely political, was discriminatory or lacked a rational basis. Paragraph 28 of the Framework Agreement contemplates a return to the Commission if the Commission had failed to deal with any matter properly arising from the inquiry or if an error is apparent in the report. However, this is merely permissive. In any event, the Divisional Court was not persuaded that the Commission erred in either of these regards.

The Ontario Court of Appeal upheld the dismissal of the Judges’ application. MacPherson J.A. explained that the Divisional Court did not err by concluding that Ontario’s engagement of PwC did not undermine the effectiveness of the commission process. Instead, it showed that Ontario intended to conduct a serious analysis with respect to those recommendations. The court considered each of Ontario’s seven reasons for rejecting the pension recommendations. It concluded that the reasons were clear, logical, relevant and consistent with Ontario’s position taken before the Commission.

As outlined above, Ontario rejected all the Commission’s optional pension recommendations. Its reasons for doing so are set out in the letter from the Honourable Chris Hodgson, Chair of the Management Board, to Mr. Stanley M. Beck, Q.C., Chair of the Commission (“Letter”). These seven reasons are essentially (1) the automatic 28 percent increase is appropriate; (2) the Judges’ pensions will not erode over time due to the benefit formula; (3) the increase in the Judges’ salary (which, in turn, automatically increased the pension) has narrowed the gap between provincial and federal judges’ salaries; (4) no significant demographic changes have occurred since the 1991 independent commission reviewed the structure of the Judges’ pension plan and presented a design which was accepted; (5) a 75 percent replacement ratio is achieved under the current pension arrangement when the likely pre-appointment savings of the Judges are considered; (6) the Ontario Judges’ pension plan is superior to the pensions provided in all other provinces and territories; and (7) the Government’s current fiscal responsibilities and competing demands for limited resources require a continued commitment to fiscal restraint to strengthen Ontario’s economy.

Do these reasons pass the test of “rationality”? To pass the test of rationality, the reasons must be legitimate. The Letter sets out seven reasons for rejecting the optional pension recommendations. The reasons outlined in the Letter do not reveal political or discriminatory motivations. They note the fact that the 28 percent salary increase automatically increases the value of the pension. They also note that no demographic changes have occurred since the pension structure was reviewed by the Second Triennial Commission in 1991. They explain that Ontario is in a period of fiscal restraint and that many areas are facing reduction. In this regard, the Judges are getting a 28 percent increase in salary and pension, and it implicitly appears that they are being treated fairly. The reasons are not political or discriminatory.

Ontario’s reasons do not reveal any improper motive. They are not bald expressions of rejection or disapproval. They reveal a consideration of the judicial office and an intention to deal with it appropriately. The reasons reflect the underlying public interest in having a commission process, being the depoliticization of the remuneration process and the need to preserve judicial independence. Therefore, this branch of the “rationality” test is satisfied.

Next, it must be determined whether the reasons rely upon a reasonable factual foundation. In determining whether the reasons rely upon a reasonable factual foundation, the test is one of a deferential standard to the government. It does not require the government to demonstrate exceptional circumstances. It simply asks: (1) Did the government indicate the factual basis upon which it sought to rely? (2) On the face of the evidence, was this reliance rational? In this case, Ontario’s reasons allege the need for fiscal restraint and point to reductions in other expenditures. The rejection of the recommended additional pension benefits for the Judges is consistent with this reasonable factual foundation. Likewise, in its reasons, Ontario suggests that no significant demographic changes have occurred warranting a change to the pension plan structure. This is also a reasonable factual foundation upon which a government can base its reasons for rejecting the Commission’s recommendations.

We conclude that Ontario’s reasons rely upon a reasonable factual foundation.

Finally, the government’s reasons must be examined globally to ensure that the objectives of the commission process have been achieved. Here, a reviewing court also plays a limited role. In this case, it appears that the commission process has been effective. Under the Framework Agreement, the Commission’s salary recommendations are binding. The pension recommendations are not. Through the binding salary recommendations, the value of the Judges’ pension has increased by 28 percent. In its reasons, Ontario has clearly respected the commission process, taken it seriously and given it a meaningful effect.

We also agree with the Ontario Divisional Court and the Court of Appeal that Ontario’s engagement of PwC was not a distortion of the process. To the contrary, it is the opposite. It demonstrates Ontario’s good faith and the serious consideration given to the Commission’s recommendations.

Ontario’s reasons, viewed globally, meet the “rationality” test.

In addition to their objection to the engagement of PwC, the Judges objected to the admissibility of the PwC affidavits. We agree with the Ontario Divisional Court and the Court of Appeal that the admission of the affidavits was proper. The Judges called upon Ontario to justify its reasons “in a court of law”. This was done. The affidavits do not add a new position. They merely illustrate Ontario’s good faith and its commitment to taking the Commission’s recommendations seriously. The fact that the Letter does not refer to Ontario’s engagement of PwC is irrelevant. The PwC retainer is not advanced as a key reason for rejecting the Commission’s pension recommendations. The reasons which are relevant are those contained within the Letter itself. These reasons met the “rationality” test.

The appeal is dismissed with costs.

The respondents in this appeal are Justices of the Peace in Alberta. Her Majesty the Queen in Right of Alberta and the Lieutenant Governor in Council (together “Alberta”) are the appellants. The issue is whether Alberta’s partial departure from the Justices of the Peace Compensation Commission’s (“Commission”) recommended salary increase violates the principle of judicial independence. The respondents say it does. Alberta disagrees. For the reasons which follow, we conclude that it does not.

On April 30, 1998, amendments to the Judicature Act, R.S.A. 1980, c. J-1 (am. S.A. 1998, c. 18) came into force which provided for, among other things, the establishment of an independent compensation commission for Justices of the Peace. Section 3(1) of the Justices of the Peace Compensation Commission Regulation, Alta. Reg. 8/2000, provides that the Commission’s task is to review remuneration and benefits paid to Alberta’s Justices of the Peace. Section 16 sets out the relevant criteria to be considered. The Commission’s recommendations are non-binding (see ss. 5(1) and 21(2) of the Regulation).

In this case, the Commission received submissions for the period of April 1, 1998 to March 31, 2003. On February 29, 2000, it issued a report recommending, among other things, a substantial increase in salary (The Justices of the Peace Compensation Commission: Commission Report (2000)). In its opinion, the compensation for Justices of the Peace should be approximately two thirds of the amount given to Provincial Court judges.

When the Commission made its recommendations, the salary of full time sitting Justices of the Peace was approximately $55,008 per annum. Per diem rates for part time sitting and presiding Justices of the Peace were $250 and $220 respectively. These amounts have not changed since 1991. In its report, the Commission noted that it did not consider the current levels of compensation to be helpful. They were out of line with the comparator groups and not the product of any type of independent inquiry process. The Commission made the following recommendations:

Full Time Sitting or Presiding Justices of the Peace

April 1, 1998 – $95 000 per annum

April 1, 1999 – $95 000 per annum

April 1, 2000 – $100 000 per annum

April 1, 2001 – $100 000 per annum

April 1, 2002 – $105 000 per annum

together, in each year, with a continuation of the current benefits and an amount equal to an additional 10% in lieu of pension and an increase in vacation entitlement from 3 to 4 weeks.

Part time Sitting and Part time Presiding Justices of the Peace

April 1, 1998 – $600 per diem

April 1, 1999 – $600 per diem

April 1, 2000 – $650 per diem

April 1, 2001 – $650 per diem

April 1, 2002 – $670 per diem

Alberta accepted the bulk of the Commission’s recommendations. On May 17, 2000, Order in Council 174/2000 (“Order”) was issued. In it, Alberta accepted that salaries and per diem rates ought to be increased (subject to the proposed modifications) (s. 2(a)); that current benefits for full-time Justices of the Peace ought to be continued (s. 2(b)); that vacation entitlement for full-time Justices of the Peace ought to be increased from three weeks to four weeks (s. 2(c)); that full-time Justices of the Peace ought to be paid an additional sum equal to 10 percent of annual salary in lieu of pension benefits (s. 2(d)); and that compensation for sitting and presiding Justices of the Peace ought to be determined on the same basis (s. 2(e)). While the Order recognized that some increase in salary was needed, it rejected the specific increases recommended by the Commission (s. 2(f)). Instead, it proposed a modified amount (s. 2(g)). The respondents challenge the constitutionality of ss. 2(a), 2(f) and 2(g).

Schedule 6 of the Order sets out Alberta’s reasons for rejecting the specific increases recommended by the Commission. These reasons are contained under the following headings: