A-54-80
CTV Television Network Limited (Applicant)
v.
Canadian Radio-television and Telecommunica
tions Commission, National Action Committee on
the Status of Women, Association of Canadian
Television and Radio Artists, Mr. Kevin Hopper,
the 1812 Committee, Joint Broadcast Committee,
Association of Canadian Advertisers Inc./Insti-
tute of Canadian Advertising, the Canadian Film
& Television Association, Council of Canadian
Filmmakers, Interchurch Communications, the
Anglican Church of Canada, the Association of
Television Producers and Directors (Toronto)
(Respondents)
Court of Appeal, Thurlow C.J., Ryan J. and
MacKay D.J.—Toronto, September 18, 19 and 22;
Ottawa, November 10, 1980.
Broadcasting — Appeal from CRTC decision renewing
appellant's broadcasting licence conditional upon the presen
tation of a specified number of hours of original new Canadian
drama each season — Whether CRTC exceeded its authority
under s. 17 of the Broadcasting Act — Whether CRTC dis
criminated against appellant — Whether CRTC failed to
comply with requirements of par. 17(1)(a) — Whether the
condition interferes with freedom of expression — Whether
CRTC failed to give proper notice of particular question to be
imposed — Whether condition is severable from renewal —
Appeal allowed because CRTC failed to give proper notice of
the type of condition being considered — Broadcasting Act,
R.S.C. 1970, c. B-11, ss. 3, 15, 16, 17(1).
Appeal from a decision of CRTC renewing appellant's
broadcasting licence conditional upon the presentation of a
specified number of hours of original new Canadian drama
each season. The following issues were considered: whether or
not the CRTC can control program content under section 17 of
the Broadcasting Act; whether or not CRTC discriminated
against appellant by acting pursuant to section 17, instead of
making rules applicable to all licensees under section 16;
whether or not CRTC failed to comply with requirements of
paragraph 17(1)(a) that a condition be "related to the circum
stances of the licensee"; whether or not the condition imposed
interferes with the right to freedom of expression declared in
paragraph 3(c); whether or not the Commission breached the
rules of natural justice in that the appellant was not given
adequate notice that the particular condition would be imposed;
and whether or not the condition is severable from the renewal
of the licence.
Held, the appeal is allowed. The decision should be set aside
and the matter referred back to the Commission for reconsider
ation and redetermination according to law after the appellant
has been afforded a reasonable opportunity to produce evidence
and make representations with respect to conditions to be
imposed. Prima facie it seems to be within the power of the
Committee under section 17 when renewing the appellant's
licence to impose a condition designed to further one of the
objects of the broadcasting policy. It would not be within the
power granted in paragraph 16(b), except under subparagraph
16(1)(b)(ix), to make regulations requiring licensees to present
original new Canadian dramas. Until the power to make regu
lations under subparagraph 16(1)(b)(ix) has been exercised,
the power under section 17 to deal with the subject-matter on
an individual basis is not ousted by subparagraph 16(1)(b)(ix).
If the CRTC has power to deal with it at all, it must be by the
route of imposing a licence condition under section 17, which,
by its terms is broad enough for that purpose. The complaint of
discrimination also fails. It was not shown that the condition
placed a more onerous burden on appellant than on other
network licensees and as the Commission is authorized to
impose conditions related to the circumstances of the licensee,
discrimination can be said to be contemplated by the Broad
casting Act provided the condition is one that is related to the
circumstances of the licensee. Although there is nothing in the
wording of the condition which expresses or describes anything
about the circumstances of the appellant or any relationship of
the condition to the circumstances of the appellant, there are
certain matters described elsewhere in the decision which are
factual bases which the Committee considered in deciding to
impose the condition. The condition, concerned as it is with the
presentation of Canadian drama and containing no restrictions
on freedom of expression in drama, does not offend the right to
freedom of expression in paragraph 3(c). There was no notice
that a condition requiring the presentation of a specific number
of hours of original new Canadian drama in each season would
be considered. Natural justice does not require that a person to
be affected by a decision have notice in advance of the decision
itself and be given an opportunity to make representations in
regard to it. But where the decision to be given is not one
prescribed by law in which the person concerned knows the
limits of an unfavourable decision, natural justice does require
that a person be given, in outline at least, the limits of the
action which the Commission intends to consider. The Commis
sion, before imposing such a condition, should have told the
appellant that the imposition of the condition or of some more
stringent condition of the same nature was under consideration
and should have asked what the appellant had to say as to why
the Commission should not impose it. The condition is not
severable as it is apparent that the Commission did not intend
to grant the renewal without the condition.
Capital Cities Communications Inc. v. Canadian Radio-
Television Commission [1978] 2 S.C.R. 141, referred to.
Confederation Broadcasting (Ottawa) Ltd. v. Canadian
Radio-Television Commission [1971] S.C.R. 906,
referred to. John Graham & Co. Ltd. v. Canadian Radio-
Television Commission [1976] 2 F.C. 82, referred to.
APPEAL.
COUNSEL:
E. Goodman, Q.C. and K. Robinson for
applicant.
T. Heintzman and P. Grant for respondent
Canadian Radio-television and Telecommuni
cations Commission.
E. Bartley for respondent Association of
Canadian Television and Radio Artists.
SOLICITORS:
Goodman & Goodman, Toronto, for appli
cant.
McCarthy & McCarthy, Toronto, for
respondent Canadian Radio-television and
Telecommunications Commission.
Hyde, Pollit, Arnold & Kirshin, Toronto, for
respondent Association of Canadian Televi
sion and Radio Artists.
The following are the reasons for judgment
rendered in English by
TIIURLOW C.J.: This is an appeal under section
26 of the Broadcasting Act, R.S.C. 1970, c. B-11,
as amended, from a decision of the Canadian
Radio-television and Telecommunications Com
mission which renewed the appellant's network
broadcasting licence for a period of three years
from September 30, 1979, but made it subject to a
condition which, as it appears in the licence, reads
as follows:
It is a condition of this licence that 26 hours of original new
Canadian drama be presented during the 1980-81 broadcasting
year, and 39 hours of original new Canadian drama be present
ed during the 1981-82 season.
In the notice of appeal the condition is alleged to
be that portion of the decision which reads:
The Commission considers that, in entering the 1980's, the
CTV priority must be the strengthening of its Canadian enter
tainment programming, with particular emphasis on the de
velopment of Canadian dramatic programs capable of attract
ing viewers in the most competitive mid-evening hours.
Accordingly, it will be a condition of the renewal of the CTV
network Licence that 26 hours of original new Canadian drama
be presented during the 1980-81 broadcasting year, and 39
hours of original new Canadian drama be presented during the
1981-82 season. In planning and developing the necessary pilots
for these dramatic programs or series, a minimum of 50%
should be entirely domestic, rather than co-productions with
foreign partners. The primary orientation should be on Canadi-
an themes and the contemplated production should be intended
for telecasting in the peak viewing periods of the evening
schedule.
In the course of argument, counsel for the appel
lant sought to treat the whole paragraph as being
the condition and it was argued that the condition
in the licence varied from that in the decision, that
both varied from what had been approved by the
Executive Committee of the CRTC and that nei
ther was the condition authorized by the Commit
tee. In my view, as a matter of construction, the
only part of the paragraph cited from the decision
which imposes a condition is the sentence which
begins with the word "accordingly" and prescribes
the condition in the same terms as appear in the
licence. While the wording differs somewhat from
that of the minute of the Executive Committee, I
am not persuaded that there is any difference of
substance or that the wording of the condition as it
appears in the decision was not within the author
ity to prepare the decision conferred by the Com
mittee on two named persons by the resolution as
minuted or that it was not approved by the mem
bers of the Committee before it was issued over
the signature of the Acting Secretary General of
the Commission. Moreover, if there is any differ
ence it appears to me that the wording, as it
appears in the licence, is less restrictive and less
onerous than that of the minute and affords the
appellant no basis for complaint. I shall according
ly treat the condition imposed as being that set out
in the licence.
The appellant's principal attack was that in
imposing the condition, the CRTC exceeded its
authority. It was submitted that with respect
either to the standard of programs or to programs
that are part of a network operation, the intent of
sections 16 and 17 of the Broadcasting Act is that
the Commission must proceed by regulation under
section 16 to make rules applicable to all licensees
or to all licensees of a class and that it was never
intended that the CRTC should deal with pro
gramming on an ad hoc basis or discriminate
between one licensee and another. In this connec
tion it was pointed out that the legislation spells
out the right of licensees and other interested
persons to a reasonable opportunity to make
representations with respect to proposed regula
tions, including those respecting programming. It
was submitted, more particularly, that if the
CRTC has authority to control program content it
can only do so by regulations under section 16,
that the CRTC power under section 17 is subordi
nate to that under section 16 and that by purport
ing to act under section 17 the CRTC not only
placed a more onerous burden on CTV than on
other licensees but discriminated against CTV in a
manner not contemplated by the Broadcasting
Act.
The authority of the Executive Committee to
issue broadcasting licences is conferred by subsec
tion 17(1). It provides:
17. (1) In furtherance of the objects of the Commission, the
Executive Committee, after consultation with the part-time
members in attendance at a meeting of the Commission, may
(a) issue broadcasting licences for such terms not exceeding
five years and subject to such conditions related to the
circumstances of the licensee
(i) as the Executive Committee deems appropriate for the
implementation of the broadcasting policy enunciated in
section 3, and
(ii) in the case of broadcasting licences issued to the
Corporation, as the Executive Committee deems consistent
with the provision, through the Corporation, of the nation
al broadcasting service contemplated by section 3;
(b) upon application by a licensee, amend any conditions of a
broadcasting licence issued to him;
(c) issue renewals of broadcasting licences for such terms not
exceeding five years as the Executive Committee considers
reasonable and subject to the conditions to which the
renewed licences were previously subject or to such other
conditions as comply with paragraph (a);
(d) subject to this Part, suspend any broadcasting licence
other than a broadcasting licence issued to the Corporation;
(e) exempt persons carrying on broadcasting receiving under
takings of any class from the requirement that they hold
broadcasting licences; and
(f) review and consider any technical matter relating to
broadcasting referred to the Commission by the Minister of
Communications and make recommendations to him with
respect to any such matter.
The objects of the Commission in furtherance of
which licences may be issued, are set out in
section 15 which provides that subject to the
Broadcasting Act, the Radio Act, R.S.C. 1970, c.
R-1, and any directions issued from time to time
by the Governor in Council under the authority of
the Act:
... the Commission shall regulate and supervise all aspects of
the Canadian broadcasting system with a view to implementing
the broadcasting policy enunciated in section 3 of this Act.
The policy declaration of section 3 is a long one
but it seems desirable to set it out in full:
3. It is hereby declared that
(a) broadcasting undertakings in Canada make use of radio
frequencies that are public property and such undertakings
constitute a single system, herein referred to as the Canadian
broadcasting system, comprising public and private elements;
(b) the Canadian broadcasting system should be effectively
owned and controlled by Canadians so as to safeguard,
enrich and strengthen the cultural, political, social and eco
nomic fabric of Canada;
(e) all persons licensed to carry on broadcasting undertakings
have a responsibility for programs they broadcast but the
right to freedom of expression and the right of persons to
receive programs, subject only to generally applicable stat
utes and regulations, is unquestioned;
(d) the programming provided by the Canadian broadcasting
system should be varied and comprehensive and should pro
vide reasonable, balanced opportunity for the expression of
differing views on matters of public concern, and the pro
gramming provided by each broadcaster should be of high
standard, using predominantly Canadian creative and other
resources;
(e) all Canadians are entitled to broadcasting service in
English and French as public funds become available;
(/) there should be provided, through a corporation estab
lished by Parliament for the purpose, a national broadcasting
service that is predominantly Canadian in content and
character;
(g) the national broadcasting service should
(i) be a balanced service of information, enlightenment
and entertainment for people of different ages, interests
and tastes covering the whole range of programming in
fair proportion,
(ii) be extended to all parts of Canada, as public funds
become available,
(iii) be in English and French, serving the special needs of
geographic regions, and actively contributing to the flow
and exchange of cultural and regional information and
entertainment, and
(iv) contribute to the development of national unity and
provide for a continuing expression of Canadian identity;
(h) where any conflict arises between the objectives of the
national broadcasting service and the interests of the private
element of the Canadian broadcasting system, it shall be
resolved in the public interest but paramount consideration
shall be given to the objectives of the national broadcasting
service;
(i) facilities should be provided within the Canadian broad
casting system for educational broadcasting; and
(j) the regulation and supervision of the Canadian broadcast
ing system should be flexible and readily adaptable to scien
tific and technical advances;
and that the objectives of the broadcasting policy for Canada
enunciated in this section can best be achieved by providing for
the regulation and supervision of the Canadian broadcasting
system by a single independent public authority.
The authority conferred by section 17 to further
the objects of the Commission is a broad one.
Under it, for the purpose of regulating and super
vising all aspects of the Canadian broadcasting
system with a view to implementing the policy
enunciated in section 3, the Executive Committee
may issue, amend at the request of the licensee,
renew or suspend broadcasting licences or may
exempt persons carrying on broadcasting receiving
licences from the requirement of having a licence.
For the same purpose when issuing or renewing a
licence, the Committee may make the licence sub
ject to such conditions related to the circumstances
of the licensee as the Committee deems appropri
ate for the implementation of the broadcasting
policy enunciated in section 3. Prima facie it
seems to be well within the power of the Commit
tee under section 17, when renewing the appel
lant's licence, to impose a condition designed to
further one of the objects of the broadcasting
policy, provided the condition is one that is "relat-
ed to the circumstances of" the appellant and
provided that its imposition is not contrary to the
Act or to a regulation that has been made in
exercise of the power to make regulations con
tained in section 16. As I see it, the question to be
determined at this point is thus, whether section 16
or the regulations made under it have the effect of
withdrawing from the broad scope of the power of
the Committee under section 17, the authority to
impose the condition here in question.
Section 16 provides:
16. (I) In furtherance of its objects, the Commission, on the
recommendation of the Executive Committee, may
(a) prescribe classes of broadcasting licences;
(b) make regulations applicable to all persons holding broad
casting licences, or to all persons holding broadcasting
licences of one or more classes,
(i) respecting standards of programs and the allocation of
broadcasting time for the purpose of giving effect to
paragraph 3(d),
(ii) respecting the character of advertising and the amount
of time that may be devoted to advertising,
(iii) respecting the proportion of time that may be devoted
to the broadcasting of programs, advertisements or
announcements of a partisan political character and the
assignment of such time on an equitable basis to political
parties and candidates,
(iv) respecting the use of dramatization in programs,
advertisements or announcements of a partisan political
character,
(v) respecting the broadcasting times to be reserved for
network programs by any broadcasting station operated as
part of a network,
(vi) prescribing the conditions for the operation of broad
casting stations as part of a network and the conditions for
the broadcasting of network programs,
(vii) with the approval of the Treasury Board, fixing the
schedules of fees to be paid by licensees and providing for
the payment thereof,
(viii) requiring licensees to submit to the Commission such
information regarding their programs and financial affairs
or otherwise relating to the conduct and management of
their affairs as the regulations may specify, and
(ix) respecting such other matters as it deems necessary
for the furtherance of its objects; and
(c) subject to this Part, revoke any broadcasting licence other
than a broadcasting licence issued to the Corporation.
(2) A copy of each regulation or amendment to a regulation
that the Commission proposes to make under this section shall
be published in the Canada Gazette and a reasonable opportu
nity shall be afforded to licensees and other interested persons
to make representations with respect thereto.
It will be observed that while the authority to
make regulations under this section is also related
to the furtherance of the objects of the Commis
sion, the subject-matter that may be dealt with by
regulations made under it is, except under sub-
paragraph 16(1)(b)(ix), limited to prescribing
classes of broadcasting licences and to particular
subjects. Among these, however, is subparagraph
16(1)(b)(i), which authorizes the making of regu
lations respecting "standards of programs" and
"the allocation of broadcasting time" for the pur
pose of giving effect to paragraph 3(d). When the
wording of subparagraph 16(1)(b)(i) is compared
with that of paragraph 3(d) it becomes apparent
that what may be the subject of regulations under
subparagraph 16(1)(b)(i) does not cover the whole
of what is embraced in paragraph 3(d) but only
the "standards of programs" and "the allocation of
broadcasting time" for the purposes described in
paragraph 3(d). It would not, in my opinion, be
within this power to make regulations requiring
licensees to present original new Canadian drama
or any other particular type of programs simply by
allocating times for its presentation or by prescrib
ing programming standards to which the drama or
other program must conform. It follows in my
opinion that if the CRTC has power to require the
presentation of original new Canadian drama at
all, such power is not found in the authority to
make regulations under subparagraph 16(1)(b)(i).
Nor is it a subject that is covered by the Non-
Canadian Programs provisions in the present
Television Broadcasting Regulations, C.R.C. 1978,
Vol. IV, c. 381.
It was not argued that the subject could proper
ly be dealt with by regulations under subparagraph
16(1)(b)(ix), but assuming that it could be, I think
it is apparent from the reference in that subpara-
graph to "the furtherance of its objects" and the
reference to the same objects in section 17, that at
least until the power to make regulations under
subparagraph 16(1)(b)(ix) has been exercised, the
power under section 17 to deal with the subject-
matter on an individual basis is not ousted by
subparagraph 16(1)(b)(ix).
Once the subject-matter of the condition is seen
to be outside the regulation-making power of
subparagraph 16(1)(b)(i) and is not dealt with in
regulations made under subparagraph
16(1)(b)(ix), it is apparent that if the CRTC has
power to deal with it at all it must be by the route
of imposing a licence condition under section 17,
which, as I have pointed out, is by its terms broad
enough for that purpose.
The appellant's principal submission accordingly
fails.
The complaint of discrimination also fails. It
was not shown that the condition placed a more
onerous burden on the appellant than on other
network licensees and as the Commission is
authorized to impose such conditions related to the
circumstances of the licensee as the Executive
Committee deems appropriate for the implementa
tion of the broadcasting policy, I do not see how
discrimination, even if it exists, can be said to be
not contemplated by the Broadcasting Act pro
vided the condition is one that is related to the
circumstances of the licensee within the meaning
of paragraph 17(1)(a).
For the same reasons, the appellant's further
submission that the subject-matter of the condition
was already dealt with by the Non-Canadian Pro
grams provisions of the Television Broadcasting
Regulations also fails. As I read them these provi
sions are merely time allocation regulations. Not
only is there nothing in them which in my opinion
deals with the subject-matter of the condition here
in question or conflicts with it, but in my view, as
already expressed, the subject-matter of the condi
tion was not properly one for regulations under
subparagraph 16(1)(b)(i).
A further submission of the appellant, one that I
have found more troublesome than the foregoing,
was that there was no evidence of circumstances of
the appellant to which the condition related so as
to fulfil the requirements of paragraph 17(1)(a)
that a condition be "related to the circumstances
of the licensee".
There is a dearth of authority on what the
phrase embraces.
In Capital Cities Communications Inc. v.
Canadian Radio-Television Commission', a deci
sion of the CRTC, after referring to litigation in
which the licensees were involved and expressing
the Commission's concern that a settlement might
affect the licensees' ability to carry out their obli
gations under the Broadcasting Act, went on to
say [at page 149]:
Hence, in such circumstance, the Commission's consent must
first be obtained before any terms of settlement and, in particu
lar, any injunction is voluntarily consented to by any licensee.
This was held to be beyond the authority of the
Commission when dealing with an application to
amend licences.
Laskin C.J.C. said at page 169:
On the assumption of jurisdiction in the sense canvassed in
the answer to question 1, two further issues are raised touching
the exercise of authority by the Commission in the present case.
Paragraph (b) of question 3 refers to that portion of the
1 [1978] 2 S.C.R. 141.
Commission's decision in which it made its consent a prerequi
site to any settlement by the respondents of litigation initiated
against them by the appellants in the Federal Court. I can find
no basis in the Act for this requirement. The concern of the
Commission that any settlement should not prejudice the abili
ty of the respondents to carry out their obligations under the
Broadcasting Act is understandable, but the Commission has
licensing control which it can exercise to secure such conformi
ty. There may be issues in a settlement which could not be of
any concern to the Commission in respect of its authority, and
it is an overreaching for it to include a requirement in its
decision of its consent to the settlement of private litigation.
This part of the decision is clearly severable; indeed, it was not
argued by the appellants that the whole decision must fall if
this part was beyond the Commission's authority.
In Confederation Broadcasting (Ottawa) Lim
ited v. Canadian Radio-Television Commission 2 ,
the Supreme Court held that the CRTC did not
have authority to impose as a term of a renewal
that at the end of the period the licensee should
not have a right to apply for a further renewal.
In neither case was there occasion to consider
what is meant by "conditions related to the cir
cumstances of the licensee".
In John Graham & Company Limited v.
Canadian Radio-Television Commission 3 , I ex
pressed the view that a licence condition requiring
the consent of the CRTC to the transfer of shares
in a licensee company was one relating to the
circumstances of the licensee within the meaning
of paragraph 17(1)(a), but that situation is so far
removed from what is involved here that the case
affords no assistance.
Turning to the condition here in question, it is
first to be observed that there is nothing in its
wording which expresses or describes anything
about circumstances of the appellant or any rela
tionship of the condition to circumstances of the
appellant. Nor is there anything in the paragraph
of the decision cited in the notice of appeal which
discloses circumstances of the appellant to which
the condition may be related. There are, however,
certain matters described elsewhere in the decision
which as it appears to me are factual bases which
the Committee took into consideration in deciding
to impose the condition. They are mingled with the
2 [1971] S.C.R. 906.
3 [1976] 2 F.C. 82 at 84.
reasoning and conclusions and counselling of the
decision and are found both before and after the
paragraph cited in the notice of appeal, but they
all appear to be circumstances of the appellant to
which the condition relates.
First, there is a reference to the affiliation
agreement between the stations and the network,
approved by the Commission's decision of 22
January 1973, having included the objectives of:
... operating in Canada "... a national network program
service in the public interest. Such services will be varied,
balanced and designed in concept to serve the national interest
comprising a balanced mix of the elements of information,
public service, the arts and entertainment programming, within
the overall capacity of the CTV System."
Next there is a paragraph which contains a
finding that this has not been achieved in certain
respects, particularly in respect of Canadian
drama. The paragraph reads:
In the Commission's view substantial progress was made during
the 1970's by the network and its member stations in meeting
this objective in relation to certain types of programming. The
Commission considers that CTV has been very successful in the
areas of information programs and sports, and should be com
mended for the high quality of the news and public affairs and
sports staff which it has assembled and developed. However, in
the opinion of the Commission, CTV has not yet in the main
achieved comparable results with distinctive Canadian enter
tainment programming, particularly in the field of drama.
Much of the discussion at the February 1979 Public Hearing
dealt with this deficiency.
This deficiency of the CTV programming is I
think a relevant circumstance of the appellant in
relation to its application for renewal of its licence.
There is then a paragraph referring to the exten
sion of service and the paragraph cited in the
notice of appeal follows. It is in turn followed by a
paragraph which cites what appears to me to be
another circumstance of the appellant: viz. the
financial and productive capability of the CTV
system to sustain a significantly greater production
effort. It reads:
It is recognized that this condition will necessitate a substantial
increase in the funds provided for the development and produc
tion of Canadian programs at a time when many other network
costs are increasing. Nevertheless, the Commission is satisfied
that the resources in the CTV system, both in terms of financial
and production capability, are sufficient to sustain a signifi
cantly greater production effort. What is required now is the
commitment of the member stations to employ these resources
collectively.
Two paragraphs later the decision proceeds:
At the Public Hearing the Chairman of the CTV Executive
Committee, speaking for the member stations, stated several
times that the present network arrangements did not prevent
effecting increased programming expenditures whenever such
increases were agreed to by the Board of Directors. The
member stations can be assessed to permit such cost increases
according to the network's cost-sharing formula. It was regret
table, however, that no satisfactory commitment was made by
CTV to increase expenditures on Canadian programming de
velopment and production in order to produce domestic pro
grams capable of attracting Canadian viewers in the face of
foreign competition. The above condition of licence will now
require such a commitment.
Here, as it seems to me, is expressed another
circumstance of the appellant: viz. its capacity to
increase expenditures and to assess member sta
tions and its unwillingness to make a satisfactory
commitment to increase expenditures on Canadian
programming development and production in
order to produce domestic programs capable of
attracting Canadian viewers in the face of foreign
competition. Having regard to the fact that what
was before the Commission was whether the
licence of the appellant should be renewed, and
that there had been what the Commission regard
ed as a failure by the appellant to achieve satisfac
tory results in the field of Canadian drama, this
seems to me to be a particularly important circum
stance of the appellant.
Later, the decision proceeds:
In reviewing the situations of the various CTV member
stations, it is obvious that there are great variations in financial
strength, capability and will to produce programs of national
network calibre. The Commission considers that each member
station should place primary emphasis in its individual local
operation on the provision of suitable news and public affairs
programs. However, in order to improve significantly Canadian
entertainment programming, different resources of various sta
tions should be combined for purposes of developing network
programs capable of attracting audiences nationally. Thus
some member stations could undertake the development of
pilots for possible national use, while other stations not capable
of such development could contribute financially according to
their ability to do so. It is recognized that the production of
such programs can only be expected from the larger stations
and the Commission considers that these stations must commit
themselves to this development.
The first sentence of this paragraph appears to
me to cite a relevant circumstance of the appellant
i.e. the great variations in the financial strength,
the capability and the will of member stations to
produce programs of national network calibre.
Finally, there is the circumstance found in the
following paragraph, that the network does not
assume enough of the financial risk and expense of
productions by network stations.
The Commission also considers that the network itself should
be prepared to absorb more, if not all, of any shortfall between
the cost of production and the lease payment made by the
network to the producing station. At present the station produc
ing the program must usually hope to achieve additional sales
beyond the network to recover its cost, let alone to make any
profit on the project. This need has an inevitable effect on the
nature and elements of the program concerned. It would be
desirable for the network to assume much more of the risk and
the expense than it now does in many instances. Obviously this
will require the provision by the member stations to the net
work of substantially greater funds for programming.
Having regard to these features of the situation
with which the Executive Committee was dealing,
I do not think it can be said that there were not
circumstances of the appellant to which the condi
tion related or that the Committee did not base its
decision on them.
It was also submitted that the condition offends
paragraph 3(c) by seeking to control the content of
programs and thus by interfering with the right to
freedom of expression. In my opinion, there is no
merit in this submission. There is nothing whatever
in the condition which interferes with freedom of
expression within the meaning of paragraph 3(c).
Even if it were possible, as I think it is not, to read
paragraph 3(c) as if it stood alone and were to be
given the widest possible meaning, the condition,
concerned as it is with the presentation of Cana-
dian drama and containing no restrictions on
freedom of expression in such drama, would not
offend it.
I turn now to the contentions put forward by the
appellant that in imposing the condition the Corn-
mission breached the rules of natural justice in
that the appellant was not given adequate notice
before the hearing that the imposition of a condi
tion was to be considered and in that the decision
was made by members who had not been present
throughout the hearing. The first of these objec
tions, in my view, in the circumstances, involves
two questions, that is to say, whether the appellant
had notice that a condition of some sort as to the
production of Canadian drama might be imposed
as a term of renewal of the appellant's licence and,
second, whether in the circumstances, the appel
lant had adequate notice and a fair opportunity to
present its position with respect to the particular
condition which was imposed.
On the first of these issues, I think it is apparent
that the appellant had ample notice that its failure
to fulfil the expectations generated by its represen
tations made at previous licensing hearings as to
the presentation of Canadian drama would be a
subject of discussion at the hearing of February
1979. The notice of that meeting specified that the
discussion would include "the adequacy of the
network structure and operation". This is, I think,
to be read in the context of what had been said in
earlier decisions of the Commission, and what had
transpired in the meantime. The decision of Janu-
ary 22, 1973 which renewed the appellant's licence
from October 1973 to September 30, 1976 con
tained the following:
At the public hearing the Commission expressed the desire
that the Network develop more drama programming with
Canadian themes, concerns and locales. The Network acknowl
edged the need and stated it expected to introduce at least one
new venture of this nature by the start of the 1973-74 season.
The decision of July 5, 1976, which renewed the
appellant's licence for a further three years includ
ed the following:
At the November 1972 Public Hearing the Commission
expressed interest in developing drama with Canadian themes,
concerns and locales. Subsequently, CTV presented "Excuse
My French", a weekly drama series produced by CFCF-TV in
Montreal, employing French and English-speaking Canadian
performers. The series, which is not being continued, ran two
seasons, achieving the third highest rating among CTV's
Canadian programs in the winter of 1975-76. The Commission
expects the network, in future schedules, to correct the deficien
cy of no weekly Canadian drama in the 1976-77 network
schedule.
In August 1978, the Commission by letter noti
fied the appellant of its intention to discuss at the
public hearing the appropriate role of CTV enter
ing the 1980's including, inter alia, the topic of
"conditions necessary for improving Canadian
programming".
Next the. appellant's letter of September 25,
1978 applying for renewal of its licence included
the following paragraphs:
The CTV Television Network last appeared before the Com
mission in November 1975 to seek the renewal of its licence.
The Commission's decision to renew that licence for a period of
three years was announced in July 1976 (CRTC 76-395). In
that announcement, the Commission drew to the Network's
attention several points of concern.
For example, the CRTC said it expected the Network, in future
schedules, to correct a perceived deficiency of weekly Canadian
drama in the 1976/77 network schedule. During the broadcast
season just recently concluded, CTV produced and scheduled a
successful, weekly half-hour adventure-drama series entitled,
"Search and Rescue" and, for the current 1978/79 season
planned, invested in, developed and committed to produce and
schedule a science fiction-drama half-hour series, "The Shape
of Things to Come". Both projects were the product of interna
tional co-production agreements with independent producers.
The latter property has been deferred indefinitely as a conse
quence of the failure of independent Canadian financial part
ners, despite the co-producers and ourselves having delivered
theatrical distribution with monetary guarantees, U.S. and
foreign television distribution with substantial financial guaran
tees and our own Canadian license contracts—all of which
conformed to their expressed needs and requirements.
It is, I think, manifest from this that the appel
lant was fully aware that the subjects of (1)
Canadian drama, (2) the appellant's performance
with respect to the presentation of Canadian
drama and (3) the Commission's concern that not
enough was being achieved with respect to the
presentation of Canadian drama would be subjects
of discussion at the public hearing. It seems to me
that this would have generated at the least an
uneasy feeling that the Commission might consid
er imposing a condition on the renewal of the
appellant's licence, but, in my view, it does not
amount to notice that that was to be considered.
The matter was, however, carried much further in
the written intervention of the Council of Canadi-
an Filmmakers, (CCFM). The document, consist-
ing of some 40 typewritten pages, contains a dis
cussion on the subject of Canadian drama and the
appellant's failure to live up to its promises of
performance with respect to Canadian drama and
concludes by recommending that "individualized
performance committments [sic]" be attached as
conditions of the appellant's licence, including,
inter alla,
(f) minimum program category quotas to be established,
particularly for drama.
This intervention, in my opinion, effectively put
the appellant on notice that the Commission would
be asked by the intervener to impose a condition
requiring a minimum presentation of Canadian
drama and would have occasion to consider that
course. That, I think, is sufficient, so far as it goes,
to satisfy the natural justice requirement of notice
that the imposition of a condition as suggested by
the intervener would be considered.
The other question, that of whether there was
due notice that the Commission would consider
imposing a condition of the kind imposed, that is
to say one requiring the presentation of a specific
number of hours of original new Canadian drama
in each of the 1980-81 and 1981-82 broadcasting
seasons and whether the appellant had a reason
able opportunity to make representations with
respect to such a condition is more serious. There
was no formal or written notice that such a condi
tion would be considered. Nor was there any oral
notice of it. In the course of the hearing, there was
a lengthy discussion of the subject of Canadian
drama but, so far as I have found, no mention was
made of a condition even resembling the kind
imposed until late in the proceedings, when, in the
course of the questioning of Mr. Murray Chercov-
er, the President of the appellant Company, by
Commissioner Dalfen, the following exchange
occurred between the Chairman and Mr.
Chercover:
COMMISSIONER DALFEN: I wonder if you could have a rest
for a while, Mr. Chercover, and I could ask Mr. McGregor and
Mr. Peters .... You may not have a rest so soon, the Chairman
wants to ask some questions.
THE CHAIRMAN: My question is very short, but before he
moves to another area, what would be—you don't have to give
me my reaction—but how about a condition of licence that
would read like this:
One drama per year, twenty-six episodes, during five years.
MR. MURRAY CHERCOVER: One drama, twenty-six episodes
a year. Would you mean by that then that you would for
example have no concern about our withdrawal from the
support we've given to the feature industry, or one-shot drama
specials that we've shown you, and/or with independant (sic)
producers?
I mean, that's the kind of thing that reduces our flexibility to
respond to the product and the productivity of the private
independent producers. It's an arbitrary ... it's the classic thing
that Mr. Dalfen was talking about. It's a counterproductive,
quantitative, therefore constraining regulation, as it were.
It's not an incentive.
THE CHAIRMAN: I was thinking of that as a minimum. A
floor. It's very clear. One drama, twenty-six episodes per year,
five years, next licence. Interesting.
MR. MURRAY CHERCOVER: If that's a deal, let's make it.
As a matter of fact, for seven years we'll keep working in the
feature field.
THE CHAIRMAN: I did not say seven years.
Well, you sleep on it. We'll move with the next line of
questioning.
In my view, if the Commission was considering
or intended to consider the imposition of a condi
tion of the kind later imposed, this was not ade
quate notice either of the Commission's intention
or of the substance of the condition to be con
sidered. And while Mr. Chercover was invited by
the Chairman to "sleep on it", by which I assume
it was intended that he consider it, I do not think
the episode amounts to fair notice that the Com
mission was considering or intended to consider
the imposition of the condition later imposed or
that the invitation to "sleep on it" was the offer of
an opportunity to make representations with
respect to the effect of the imposition of such a
condition.
Natural justice does not, as I understand it,
require that a person to be affected by a decision
have notice in advance of the decision itself and be
given an opportunity to make representations in
regard to it. But where, as here, the decision to be
given is not one prescribed by law in which the
person concerned knows the limits of an unfavour
able decision, it seems to me that natural justice
does require that a person be given, in outline at
least, the limits of the action which the Commis-
sion intends to consider. In my opinion, in the
particular circumstances of the case, the least that
fairness to the appellant required, was for the
Commission, before issuing a decision imposing
such a condition, to tell the appellant that the
imposition of the condition or of some more strin
gent condition of the same nature was under con
sideration and to ask what the appellant had to say
as to why the Commission should not impose it.
It is to be observed that there are elements in
the condition which were not in what was recom
mended in general terms by the CCFM interven
tion. The recommendation suggested no minimum
number of hours. Nor did it specifically mention
"new" or "original" Canadian drama. Moreover,
the condition imposed differs in substance from
that suggested in the exchange between the Chair
man and Mr. Chercover.
In my opinion, therefore, the decision cannot
stand. It should be set aside and the matter should
be referred back to the Commission for reconsider
ation and redetermination according to law after
the appellant has been afforded a reasonable op
portunity to produce evidence and make represen
tations with respect to conditions, if any, to be
imposed on the appellant's licence requiring the
presentation of Canadian drama and after such
evidence and representations have been duly and
fairly considered by the Commission and by its
Executive Committee.
As it is necessary to refer the matter back to the
Commission, where the representations of the
appellant on the imposition of conditions will be
made to the Commission itself, before the matter
is dealt with by the Executive Committee, the
second objection of the appellant, that the full
panel of members of the Commission were not
present throughout the public hearing, in my view,
becomes irrelevant. But there is no doubt that all
the members of the Commission who had been
present at the beginning of the public hearing were
not present throughout and that, at one point,
when the subject-matter of Canadian drama was
under discussion, the members present consisted of
but two members of the Executive Committee.
The matters complained of occurred on the
second and third days of the public hearing. At the
commencement of the sittings on the second day,
one of the members was not present. The tran
script indicates that the hearing proceeded without
him, and without objection by the appellant. The
member was present later in the day but when he
came in was not noted. The transcript for the
afternoon of the third day records the following:
THE CHAIRMAN: ... At this point we will break for fifteen
minutes. I would like, however, to say this—and I think I have
to have the agreement of the applicants—that a few members
on my panel have some problems about flights, and also for
something else in another city tomorrow morning, so if you
have no objection we will continue with a reduced panel. But it
depends on the applicants, if they accept that or not.
If they don't, they will have to stay.
MR. D. OSBORN: If Mr. Hylton has any kind of memory, I
think I know what his response will be.
MR. JOHN HYLTON: No, I was just wondering if we should
have a little survey and see who is leaving and who is staying,
and whether they had been nice to us in their questions.
THE CHAIRMAN: Let me give you an allegory. You have a
cup of coffee, the coffee and the sugar are gone, only the cream
is left.
MR. MURRAY CHERCOVER: Would you care to name names?
THE CHAIRMAN: No, I will not name names. That will be the
surprise after the coffee break.
MR. JOHN HYLTON: That gives us no concern, sir.
THE CHAIRMAN: Thank you. It is much appreciated.
Fifteen minutes. Un [sic] pause de quinze minutes.
—A recess was taken at 3:45 p.m.
—Upon resuming at 4:10 p.m.
(Present on the panel upon resuming, were Chairman, Dr. P.
Camu, Commissioner C. Dalfen, and Commissioner J. Hebert).
At this stage, three members of the Commission
were absent. Later, Mr. Hebert also retired from
the hearing. These members were absent during at
least a part of the time when the appellant was
making its response to interventions, including that
of CCFM. It appears as well that the same four
members who absented themselves subsequently
took part in the consultation provided for in sub
section 17(1) and that two of them were also
present at the meeting of the Executive Committee
which approved the renewal of the licence subject
to the condition.
Assuming that the members who were present
at the beginning of the public hearing had been
designated to hear the matter pursuant to subsec
tion 19(4), it seems extraordinary that they should
not have been present throughout the hearing.
Moreover, it does seem undesirable, if not, indeed,
contrary to the Broadcasting Act, that a member
who is part of a panel designated to hold a public
hearing and who absents himself during a part of
the hearing should thereafter be present at or
participate in the consultation required by subsec
tion 17(1). Counsel for the Commission urged that
the departure of the members from the hearing
had been in one instance with the express, and in
the others with the tacit, approval of the appellant
and that the appellant had subsequently filed a
lengthy memorandum for the information of the
members who had absented themselves. He sub
mitted that the objection had been waived and that
in any event the public hearing required by the
statute was merely for the purpose of obtaining the
representations of members of the public and of
informing the Commission and that it was not
necessary in law for the members to remain in
attendance throughout the hearing.
Since in my view the appellant's objection is
now irrelevant, it does not appear to me to be
necessary to reach a concluded opinion either on
the objection or on the answer of the Commission
and nothing in these reasons should be regarded as
supporting either the objection or the answer.
However, I think it is opportune to observe that for
a Chairman at a hearing at which a party is
seeking renewal of a licence to ask a party to say
whether he objects to a member of the panel
leaving while the hearing is in progress is capable
of putting the party in a position of embarrassment
into which he should not be put. Undoubtedly, he
could object but if he did he might well have to
wonder if by doing so his position with the Com
mission was being prejudiced. Moreover, for the
Chairman to ask if a party approves of members of
the panel absenting themselves puts the Commis
sion in the undesirable position of asking indul
gences from parties who are entitled to assume
that members of the panel will stay to hear their
presentations.
Several further points were raised with respect
to the alleged uncertainty of the condition itself
and with respect to alleged uncertainty of what is
required by the other wording contained in the
paragraph cited in the notice of appeal. As the
matter is to go back to the Commission, it appears
to me to be unnecessary to deal with these points
on this appeal.
The remaining point that should be mentioned is
a submission by the appellant that the condition is
severable from the rest of the decision and that it
alone should be set aside, thus leaving the appel
lant with a renewal licence not subject to such a
condition. In my opinion, the condition is not
severable from the renewal of the licence as, in my
view, it is apparent from the decision that the
Commission did not intend to grant the renewal
without the condition.
It will be necessary, therefore, as I see it, to set
aside the decision in so far as it grants renewal of
the licence subject to the condition and to refer the
matter back to the Commission for the purpose
indicated. As the effect of this will be to leave the
appellant without a licence to continue its opera
tion the judgment of the Court should not be
pronounced for a period of two weeks from the
date of the filing of these reasons, or for such
further period as may be arranged by agreement
of the parties and with the approval of the Court,
in order to permit the appellant to seek and the
respondent to consider the grant of a temporary
licence pending the final determination of the
appellant's licence renewal application.
Having regard to Rule 1312 there should be no
costs awarded to either party.
* * *
RYAN J.: I concur.
* * *
The following are the reasons for judgment
rendered in English by
MACKAY D.J.: I agree with the reasons and
conclusions of the Chief Justice in allowing this
appeal and also with his directions in respect of the
scope of the new hearing.
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.