A-29-87
Central Western Railway Corporation (Applicant)
v.
United Transportation Union, The Brotherhood of
Maintenance of Way Employees, Canadian Signal
and Communications Union, Brotherhood of
Locomotive Engineers and Canada Labour Rela
tions Board (Respondents)
INDEXED AS: CENTRAL WESTERN RAILWAY CORP. v. U. T. U.
Court of Appeal, Marceau, Hugessen and
Lacombe JJ.—Montréal, October 28 and 29,
1987; Ottawa, January 28, 1988.
Constitutional law — Distribution of powers — Application
to review Canada Labour Relations Board decision sale of
railway governed by Canada Labour Code — Line entirely
within province — Whether line federal work, undertaking or
business — Whether integral part of federal undertaking
Whether western grain transportation network federal under
taking — Whether interprovincial railway — Whether Parlia
mentary declarations line work for general advantage of
Canada valid and applicable — Whether sale of line changing
constitutional character under s. 92(10)(a) or (c) — Whether
federal character of line extending to undertaking.
Labour relations — Provincial company purchasing from
CNR railway line entirely within province — Whether bound
by existing collective agreements — Constitutional law distri
bution of powers issues.
Railways — Provincial company purchasing line from CNR
— Formerly part of interprovincial railway, but now device
preventing access to CN tracks — Line entirely within province
— Whether federal work — Whether character as work
extending to undertaking (labour relations) — Canada Labour
Relations Board correctly holding purchaser bound by existing
collective agreements.
This was an application to review a decision of the Canada
Labour Relations Board that the sale of a railway line was
governed by section 144 of the Canada Labour Code, so that
the new owner was bound by the existing collective agreements.
Central Western bought a rail line, located entirely within
Alberta, from CNR. The line served area grain elevators.
Central Western brought grain cars to various elevator points,
filled them and brought them back to Ferlow Junction, where
they were picked up by CNR employees for delivery through
out the province and beyond. CNR employees returned the
empty grain cars to Ferlow Junction. A "locked open point
derail device", controlled by CNR, prevented Central West-
ern's trains from passing freely onto the CNR tracks and vice
versa. The Board held that Central Western was a federal
work, undertaking or business as an integral part of a federal
undertaking. The Board concluded that there were enough ties
between Central Western and three federal undertakings: the
CNR, the grain elevators and feed mills and the western grain
transportation network, to make it a federal work or
undertaking.
Held (Hugessen J. dissenting), the application should be
dismissed.
Per Marceau J: The Board's conclusion was correct, but its
reasoning was ill-founded. (1) The western grain transportation
network was not a federal undertaking. It was not a singular
and autonomous undertaking existing as an independent entity,
and its establishment could not be supported by any specific
field of exclusive federal jurisdictional power. (2) Although the
grain elevators west of Thunder Bay were under federal juris
diction because they had been declared works for the general
advantage of Canada, Central Western, a transportation under
taking, was not an integral part of the elevators' business which
was to receive, handle, and store, but not transport, grain. Its
services were not so essential as to be integral when they could
be replaced by using trucks. (3) The connections between
Central Western and the CNR did not require that the two
entities be treated as one to regulate their activity. Although
both companies benefitted from their relationship, and Central
Western could hardly operate without the CNR, that did not
prevent them from being separate businesses or undertakings.
Even if Central Western was an essential element in the CNR's
dealings with some of its clients, CNR's operations were not so
dependent upon those of Central Western as to make the latter
an "integral", "vital" and "permanent" part of CNR
operations.
Central Western's line fell under paragraph 92(10)(a) of the
Constitution Act, 1867, as an interprovincial railway and sub-
sidiarily, under paragraph 92(10)(c) as having been the subject
of Parliamentary declarations. Prior to its sale to Central
Western, the line was an indivisible and integral part of the
Canadian National network. Such a character attached to the
work itself, and did not disappear when the line changed
owners, or because its connection with the CNR's line was
controlled by a special device. A radical change in the use and
function of the line would be required to change its
characterization.
In any case, Central Western's rail line had been validly
declared to be for the general advantage of Canada. Even if
such declarations were unnecessary when enacted because Cen
tral Western's line was already an indivisible part of an inter-
provincial railway, they could not be ignored. As to the submis
sion that the declarations no longer applied since the line was
not owned by one of the companies referred to in the statutory
provisions, it could not have been contemplated that a change
of ownership would change the constitutional character of the
work. Nor did the approval of the sale to a provincial company
by the Governor General in Council impliedly render ineffec
tive the declarations. Although Parliament can at any time
rescind its own declaration, the Governor General in Council
has no such power. Parliament must expressly intervene to
change the constitutional characterization of a "matter".
Cases holding that the construction, repair or maintenance of
a federal work could be carried out without the labour relations
falling under federal jurisdiction were to be distinguished from
the situation of an undertaking, such as this, whose raison
d'être was to operate a federal work.
Per Lacombe J.: Central Western's line fell within federal
jurisdiction because it was still subject to a declaration under
paragraph 92(10)(c) of the Constitution Act, 1867 that it was a
work for the general advantage of Canada. The change in
ownership did not alter the effect of the paragraph 92(1)(c)
declaration, since only Parliament could repeal it. The line was
no longer an integral part of an interprovincial railway. Nor
was it an integral part of a core federal undertaking. None of
the three core federal undertakings identified by the Board
formed a proper basis for upholding the Board's jurisdiction.
The entire railway undertaking, including labour relations,
fell within federal competence. Central Western's employees
were engaged in the day-to-day operation of a railway under
taking operating over a federal work. Their involvement was of
an ongoing character and essential to the employer's operation
of a railway. Regulation of the conditions of employment was
an integral part of federal competence over the matter.
Per Hugessen J. (dissenting): The Board had no jurisdiction
to make the decision under review. Central Western's line was
not a primary federal work or undertaking within paragraph
92(10)(a) (interprovincial railway). As a work, it was entirely
within the province and was physically separated from CNR's
line, which connects with other provinces. As an undertaking, it
did not connect Alberta to other provinces. Nor was it function
ally integrated with a core federal undertaking. CNR was not
dependent upon Central Western. That Central Western may
have been wholly dependent upon CN was irrelevant. The grain
elevators were federal works, but not part of the railway works
or undertakings. The "western grain transportation network"
was not an undertaking at all, let alone a core federal undertak
ing. It was nothing more than an agglomeration of persons,
things and policies, with no identifiable person or corporation
acting as undertaker.
Central Western's line, as a work, was subject to a declara
tion that it was for the general advantage of Canada, and thus
within federal jurisdiction. But the declaration applied to the
works, not the undertaking. Labour relations are not subject to
federal jurisdiction simply because labour is performed on or in
connection with a federal work. Labour relations are within
provincial competence, unless jurisdiction over them is an inte
gral part of Parliament's primary competence over some other
single federal subject. Regulation of labour relations was not an
integral element of federal authority over use of the track.
STATUTES AND REGULATIONS JUDICIALLY
CONSIDERED
An Act to incorporate Canadian National Railway Com
pany and respecting Canadian National Railways
S.C. 1919, c. 13, s. 18.
Canada Grain Act, S.C. 1970-71-72, c. 7.
Canada Labour Code, R.S.C. 1970, c. L-1, ss. 2, 108 (as
am. by S.C. 1972, s. 18, s. 1), 144 (as am. idem).
Canadian National Railways Act, R.S.C. 1970, c. C-10,
ss. 18(1), 23, 31.
Canadian Wheat Board Act, R.S.C. 1970, c. C-12.
Central Western Railway Corporation Act, S.A. 1984, c.
71.
Constitution Act, 1867, 30 & 31 Vict., c. 3 (U.K.)
[R.S.C. 1970, Appendix II, No. 5] (as am. by Canada
Act, 1982, 1982, c. 11 (U.K.), Schedule to the Consti
tution Act, 1982, Item 1), ss. 91(29), 92(10).
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10, s. 28.
Railway Act, R.S.C. 1970, c. R-2, s. 6(1)(c).
CASES JUDICIALLY CONSIDERED
APPLIED:
Northern Telecom Ltd. v. Communications Workers of
Canada, [1980] 1 S.C.R. 115; Northern Telecom Canada
Ltd. et al. v. Communication Workers of Canada et al.,
[1983] 1 S.C.R. 733; Canadian Pacific Railway Com
pany v. Attorney-General for British Columbia and
Attorney-General for Canada, [1950] A.C. 122 (P.C.);
Luscar Collieries v. McDonald, [1927] A.C. 925 (P.C.).
DISTINGUISHED:
Luscar Collieries Ltd. v. McDonald, [1925] S.C.R. 460;
[1925] 3 D.L.R. 225; Montreal Tramways Co. v.
Lachine, Jacques-Cartier and Maisonneuve Railway Co.
(1914), 50 S.C.R. 84; Kootenay & Elk Railway Co. v.
Canadian Pacific Railway Co., [1974] S.C.R. 955; Gen-
era! Teamsters, Local 362, and Stern Transport Ltd. and
Byers Transport Limited (1986), 12 CLRBR (NS) 236;
Canada Labour Code (Re), [1987] 2 F.C. 30 (C.A.).
CONSIDERED:
British Columbia Electric Ry. Co. Ltd. et al. v. Canadian
National Ry. Co. et al., [1932] S.C.R. 161; Construction
. Montcalm Inc. v. Minimum Wage Commission, [ 1979] I
S.C.R. 754; Re Canada Labour Code (1986), 72 N.R.
348 (F.C.A.); Montreal City v. Montreal Street Railway
Company, [1912] A.C. 333 (P.C.); In re Regulation and
Control of Radio Communication in Canada, [1932]
A.C. 304 (P.C.); Attorney-General for Ontario v. Israel
Winner, [1954] A.C. 541 (P.C.); Commission du Salaire
Minimum v. Bell Telephone Company of Canada, [1966]
S.C.R. 767; Reference re Industrial Relations and Dis
putes Act, [1955] S.C.R. 529; R. v. Thumlert (1959), 28
W.W.R. 481 (Alta. S.C.A.D.); Chamney v. The Queen,
[1975] 2 S.C.R. 151; The Queen in The Right of The
Province of Ontario v. Board of Transport Commission
ers, [1968] S.C.R. 118.
REFERRED TO:
The King v. Eastern Terminal Elevator Co., [ 1924]
Ex.C.R. 167; affd [1925] S.C.R. 434; Canadian National
Railway Co. v. Nor-Min Supplies Ltd., [1977] 1 S.C.R.
322; CTC Telecommunications Systems, Inc. c.o.b. as
Canadian Telecommunications Group and Communica
tions Workers of Canada (1985), 10 CLRBR (NS) 231
(Ont.); Cannet Freight Cartage Ltd. (In re), [1976] 1
F.C. 174 (C.A.); Re The Queen and Cottrell Forwarding
Co. Ltd. (1981), 124 D.L.R. (3d) 674 (Ont. Div. Ct.);
Henuset Rentals Ltd. v. United Association of Journey
men and Apprentices of the Plumbing and Pipefitting
Industry, Local Union 488 (1981), 6 Sask. R. 172 (C.A.);
Re Maritime Engineering Limited, Labourers' Interna
tional Union of North America, Local 1115, and Attor
ney General of Nova Scotia (1979), 33 N.S.R. (2d) 484
(S.C.A.D.); Kelowna v. Labour Relations Bd. of B.C. et
al., [1974] 2 W.W.R. 744 (B.C.S.C.); Hamilton, Grims-
by and Beamsville R. Co. v. Atty.-Gen. for Ontario
(1916), 29 D.L.R. 521 (P.C.).
AUTHORS CITED
Finkelstein, Neil Laskin's Canadian Constitutional Law,
vol. 1, 5th ed. Toronto: Carswell, 1986.
Fraser, Ian H. "Some comments on Subsection 92(10)(c)
of the Constitution Act, 1867" (1983-84), 29 McGill
L.J. 557.
Hogg, Peter W. Constitutional Law of Canada, 2nd ed.
Toronto: Carswell, 1985.
Lajoie, Andrée Le pouvoir déclaratoire du Parlement,
Montréal: Les Presses de l'Université de Montréal,
1969.
Schwartz, Phineas "Fiat by Declaration—S. 92(10)(c) of
the British North America Act" (1960-63) 2 Osgoode
L.J. 1.
COUNSEL:
Thomas W. Wakeling and Gerald D. Chipeur
for applicant.
James L. D. Shields for respondent Brother
hood of Locomotive Engineers.
Judah Levinson for respondent Canada
Labour Relations Board.
Douglas J. Wray, for respondents United
Transportation Union, Canadian Signal and
Communications Union, The Brotherhood of
Maintenance of Way Employees.
H. Scott Fairley for Attorney General of
Canada.
SOLICITORS:
Milner & Steer, Edmonton, for applicant.
Soloway, Wright, Houston, Greenberg,
O'Grady, Morin, Ottawa, for respondent
Brotherhood of Locomotive Engineers.
Legal Service, Canada Labour Relations
Board, Ottawa, for respondent Canada
Labour Relations Board.
Caley & Wray, Toronto, for respondents
United Transportation Union, Canadian
Signal and Communications Union, The
Brotherhood of Maintenance of Way
Employees.
Gowling & Henderson, Ottawa, for respon
dent Attorney General of Canada.
The following are the reasons for judgment
rendered in English by
MARCEAU J.: The issue in this section 28 [Fed-
eral Court Act, R.S.C. 1970 (2nd Supp.), c. 10]
application is whether Part V of the Canada
Labour Code, R.S.C. 1970, c. L-1 applies to the
employer-employee relations of the applicant cor
poration. Its difficulty and implication will readily
be seen when the facts that led to it are known.
They are not in dispute and can briefly be
summarized.
The applicant ("Central Western") was created
by a special Act of the Alberta Legislature in 1984
(the Central Western Railway Corporation Act,
S.A. 1984, c. 71). It operates a rail line between
Ferlow Junction and Dinosaur, a distance of
approximately 105 miles, all of which is located
within the province of Alberta. This rail line,
known as the Stettler Subdivision, a name it bore
while the track and associated lands were owned
by the Canadian National Railway Company
(CNR), was acquired by Central Western in 1985.
The transfer of ownership of the rail line has in no
way changed its essential purpose: to provide ser
vice to grain elevators in that region. Essentially,
Central Western's operations consist in bringing
empty grain cars from Ferlow Junction to various
elevator points on the Stettler line and bringing the
cars back once they are filled with grain. The
CNR employees bring the empty cars to Ferlow
Junction and pick up the filled cars for delivery
throughout the province and beyond. By means of
a piece of equipment referred to as a "locked open
point derail device", which is under the control of
CNR, Central Western's trains are prevented from
passing freely on to the CNR tracks at either
terminus.
Shortly after the acquisition by Central Western
of the Stettler Subdivision, the four respondent
unions herein brought an application before the
Board for an order that the sale of the line was
governed by the provisions of section 144 [as am.
by S.C. 1972, c. 18, s. 1] of the Canada Labour
Code so that the new owner was bound by the
collective agreements to which they and the CNR
were parties.' Central Western opposed the
application. Submitting that it was not a federal
work, undertaking or business, the basic condition
for it to be subject to the provisions of Part V of
the Canada Labour Code, as more precisely con-
'Section 144 reads in part thus:
144. (1) In this section,
"business" means any federal work, undertaking or business
and any part thereof;
"sell", in relation to a business, includes the lease, transfer
and other disposition of the business.
(2) Subject to subsection (3), where an employer sells his
business,
(a) a trade union that is the bargaining agent for the
employees employed in the business continues to be their
bargaining agent;
(Continued on next page)
firmed in section 108 [as am. idem] of the Code, 2
Central Western disputed the power of the Board
to entertain the unions' application. The Board
rejected the submission and, affirming its jurisdic
tion, made the order sought. Central Western
immediately launched the present section 28
application.
The approach adopted by the Board and the
reasoning it followed to arrive at the conclusion
that Central Western was a federal work, under
taking or business subject to federal labour legisla
tion are set out in lengthy reasons a brief outline of
which should be sufficient to appreciate the appli
cant's objections.
The first part of the reasons is devoted to a
complete review of the history of the Stettler
Subdivision, of the incorporation of Central West
ern, of that corporation's structure and operations
and its relations with the CNR. Then comes the
central analysis. An allusion is made to the possi
bility that Central Western may be covered by a
declaration that it is a work for the general advan
tage of Canada under paragraph 92(10)(c) of the
Constitution Act, 1867 [30 & 31 Vict., c. 3 (U.K.)
[R.S.C. 1970, Appendix II, No. 5] (as am. by
Canada Act, 1982, 1982, c. 11 (U.K.), Schedule to
the Constitution Act, 1982, Item 1)]' but any
(Continued from previous page)
(b) a trade union that made application for certification in
respect of any employees employed in the business before
the date on which the business is sold may, subject to this
Part, be certified by the Board as their bargaining agent;
(e) the person to whom the business is sold is bound by
any collective agreement that is, on the date on which the
business is sold, applicable to the employees employed in
the business; and
(d) the person to whom the business is sold becomes a
party to any proceeding taken under this Part that is
pending on the date on which the business was sold and
that affects the employees employed in the business or
their bargaining agent.
2 The section reads as follows:
108. This Part applies in respect of employees who are
employed upon or in connection with the operation of any
federal work, undertaking or business and in respect of the
employers of all such employees in their relations with such
employees and in respect of trade unions and employers'
organizations composed of such employees or employers.
3 The paragraph is only referred to without being reproduced
in the reasons. I will come to it later.
necessity for dealing with the issue is discarded in
view of the fact that a conclusion can be more
easily reached on the basis of another approach.
This other approach is said to be based on a basic
premise. "In the transportation industry", it is
stated, "there are generally two ways that federal
jurisdiction is triggered": when there "is an extra-
provincial element in the work or undertaking in
question" and when "the operations of an other
wise provincial work or undertaking are an inte
gral part of a federal undertaking." 4 The first
approach is declared of no avail in the absence of
the extra-provincial element required, but the
second, which brings into play the principles and
guidelines established in the two leading cases of
Northern Telecom Ltd. v. Communications Work
ers of Canada, [1980] 1 S.C.R. 115, at pages
132-133 and [Northern Telecom Canada Ltd. et
al. v. Communication Workers of Canada et al.]
[1983] 1 S.C.R. 733, at pages 770-774, is seen as
being determinative. Three federal undertakings
with which Central Western, as a going concern,
can be seen as being connected are first identified:
the CNR, the elevators and feed mills situated
along the railway line and the western grain trans
portation network. There follows an analysis of the
physical and operational connection between Cen
tral Western and each of the three possible candi
dates from which it is concluded that with each of
them there are enough ties to make Central West
ern a federal work or undertaking.
Counsel for the applicant naturally disputes the
validity of the Board's reasoning and I must say
that I too have difficulties with it.
First, I do not think that the "western grain
transportation network" can be seen as a federal
undertaking for the purpose of applying the test
set forth by the Northern Telecom judgments.
4 The two approaches here referred to by the Board may have
been suggested to it by its own Act but, in fact, they are the two
situations where an otherwise local work or undertaking may
fall under paragraph 92(10)(a) of the Constitution Act, 1867.
This too will be discussed later.
This national communication system is a goal
achieved through various means, it is not a singu
lar and autonomous undertaking existing as an
independent entity and in any event its establish
ment would not, considered in itself, be supported
by any specific field of exclusive federal jurisdic
tional power. (One may refer on this point to the
comments of Lord Reid in Canadian Pacific Rail
way Company v. Attorney-General for British
Columbia and Attorney-General for Canada (the
Empress Hotel case), [1950] A.C. 122 (P.C.),
especially at pages 140 et seq.).
Second, I am not prepared to accept that the
fact that Central Western's main operations are
devoted to providing service to the grain elevators
is sufficient to trigger federal jurisdiction. It is true
that the grain elevators west of the city of Thunder
Bay are under federal jurisdiction since they, with
the feed mills, have been declared works for the
general advantage of Canada under the Canada
Grain Act, S.C. 1970-71-72, c. 7, as well as under
the Canadian Wheat Board Act, R.S.C. 1970,
c. C-12. They may therefore, I agree with the
Board, constitute a possible core federal undertak
ing for local works or businesses. I do not see,
however, how Central Western, as a transportation
undertaking, can be an integral part of elevators
whose business is the receiving, handling, storing,
weighing, grading, cleaning and discharging, but
not transporting grain. I do not see either how
Central Western's operations can be so "vital" and
"essential" to the elevators' business as to consti
tute an integral part thereof as required by the
Northern Telecom test, as I understand it, bearing
in mind in particular that the services of Central
Western could very well be dispensed with, if
necessary, and replaced by a system making use of
trucks. (See on those points: The King v. Eastern
Terminal Elevator Co., [1924] Ex.C.R. 167; affd
[1925] S.C.R. 434; Canadian National Railway
Co. v. Nor-Min Supplies Ltd., [1977] 1 S.C.R.
322; see also CTG Telecommunications Systems,
Inc. c.o.b. as Canadian Telecommunications
Group and Communications Workers of Canada
(1985), 10 CLRBR (NS) 231 (Ont.), at page 261.
Finally, it does not appear to me that the con
nections between Central Western as a business
and a going concern and the CNR, the national
railway, are such that the two undertakings ought
to be treated as being one for the purpose of
regulating their activity. It is true that the two
companies benefit from their relationship and
indeed that Central Western could hardly even
operate without the CNR; but the situation was
not that much different in the Empress Hotel case,
supra, and yet the Privy Council refused to draw
therefrom a conclusion of integration. The often-
quoted statement of Lord Reid in that case is here
opposite (at page 144):
No doubt the fact that there is a large and well-managed hotel
at Victoria tends to increase the traffic on the appellant's
system; it may be that the appellant's railway business and
hotel business help each other, but that does not prevent them
from being separate businesses or undertakings.
It is true also that, to fulfill the obligation it may
have assumed of carrying to its final destination
the grain brought to and handled by the elevators
situated along the track between Ferlow Junction
and Dinosaur, the CNR must now rely, on a
permanent basis, on services provided by Central
Western's operations. But if that makes Central
Western an essential element in the CNR's deal
ings with some of its clients, it certainly does not
make the operations of the CNR dependent upon
those of Central Western so as to make the latter
an "integral", "vital" and "permanent" part of the
operations of the former.
So, I am not at all convinced that the reasoning
followed by the Board is well-founded. It does not
necessarily follow, however, that its conclusion is
wrong. I now think that it is, indeed, the right one
but, of course, to support it another reasoning is
required. I come to that reasoning.
The provisions of the Constitution Act, 1867 on
the basis of which the question of constitutional
jurisdiction arising here must be resolved are con
tained in subsection 92(10) which must be read in
relation to subsection 91(29). They provide as
follows:
91. It shall be lawful for the Queen, by and with the Advice
and Consent of the Senate and House of Commons, to make
Laws for the Peace, Order, and good Government of Canada,
in relation to all Matters not coming within the Classes of
Subjects by this Act assigned exclusively to the Legislatures of
the Provinces; and for greater Certainty, but not so as to
restrict the Generality of the foregoing Terms of this Section, it
is hereby declared that (notwithstanding anything in this Act)
the exclusive Legislative Authority of the Parliament of
Canada extends to all Matters coming within the Classes of
Subjects next hereinafter enumerated; that is to say,-
29. Such Classes of Subjects as are expressly excepted in the
Enumeration of the Classes of Subjects by this Act
assigned exclusively to the Legislatures of the Provinces.
92. In each Province the Legislature may exclusively make
Laws in relation to Matters coming within the Classes of
Subjects next hereinafter enumerated; that is to say,-
10. Local Works and Undertakings other than such as are
of the following Classes:—
(a) Lines of Steam or other Ships, Railways, Canals,
Telegraphs, and other Works and Undertakings con
necting the Province with any other or others of the
Provinces, or extending beyond the Limits of the
Province;
(b) Lines of Steam Ships between the Province and any
British or Foreign Country:
(c) Such Works as, although wholly situate within the
Province, are before or after their Execution declared by
the Parliament of Canada to be for the general Advan
tage of Canada or for the Advantage of Two or more of
the Provinces. 5
5 Section 2 of the Canada Labour Code incorporates these
provisions of the Constitution Act, 1867 in its definition of
"federal work, undertaking or business" to which the Code
applies. It reads in part thus:
2. In this Act
"federal work, undertaking or business" means any work,
undertaking or business that is within the legislative au
thority of the Parliament of Canada, including without
restricting the generality of the foregoing:
(Continued on next page)
It is my view that the Stettler Subdivision, as it
is now operated, falls directly under paragraph (a)
of subsection 92(10) as being an interprovincial
railway (the possibility that the Board rejected
before reaching the conclusion that paragraph
92(10)(a) indeed applied but because the under
taking was connected to an interprovincial one),
and subsidiarily, under paragraph (c) as having
been the subject of a declaration (the possibility
that the Board declined to consider).
My reason for thinking that the Stettler Sub
division, as it is used, must be seen as a railway
connecting a province with other provinces within
the meaning of paragraph 92(10)(a) of the Con
stitution Act, 1867 can be easily put. Prior to its
sale to Central Western, this line between Ferlow
Junction and Dinosaur formed an indivisible and
integral part of the Canadian National network. It
seems to me that such a character, which attaches
to the work itself, cannot be seen as having disap
peared for the sole reason that the line is now
owned and operated by a different corporate
entity, or that its connection with the CNR's line
is now controlled by a special device. Being oper
ated exactly as it was previously, the line remains
a segment of a railway "connecting the province
with other provinces". A radical change in the use
and function of the line would, I suggest, have
been required to change that perspective. Had the
Stettler Subdivision become, in its operation, a
tourist attraction hauling paying passengers from
scenic spot to scenic spot, for example, then there
would be ground for concluding that the line has
left behind its old character and acquired a new
one. Nothng of the sort has occurred here.
(Continued from previous page)
(b) a railway, canal, telegraph or other work or undertak
ing connecting any province with any other or others of the
provinces, or extending beyond the limits of a province;
(h) a work or undertaking that, although wholly situated
within a province, is before or after its execution declared
by the Parliament of Canada to be for the general advan
tage of Canada or for the advantage of two or more of the
provinces; and
I see no meaningful difference in the situation
we have here and that which was before the Privy
Council in the case of Luscar Collieries v.
McDonald, [1927] A.C. 925 (P.C.) where the
conclusion reached was expressed as follows (at
pages 932-933):
... having regard to the way in which the railway is operated,
their Lordships are of opinion that it is in fact a railway
connecting the Province of Alberta with others of the Provinces,
and therefore falls within s. 92, head 10(a), of the Act of 1867.
There is a continuous connection by railway between the point
of the Luscar Branch farthest from its junction with the
Mountain Park Branch and parts of Canada outside the Prov
ince of Alberta.
On the other hand, it seems to me that the decision
in British Columbia Electric Ry. Co. Ltd. et al. v.
Canadian National Ry. Co. et al., [ 1932] S.C.R.
161 must be distinguished in that the one-mile
stretch of rail in question there had not previously
been operated by a national company as an indivis
ible part of a national railway system. The deci
sions rendered in cases of severance and sale of
part of federal undertakings, (as, for instance, in
the case of General Teamsters, Local 362, and
Stern Transport Ltd. and Byers Transport Lim
ited (1986), 12 CLRBR (NS) 236) must also be
readily distinguished. As put by one of the counsel
for the respondents: "once an undertaking is
severed, there remains nothing common to the two
branches except, possibly, a degree of coordination
or cooperation in the two businesses. Where a
work is severed, however, 6 the physical premises
and the physical connection remain. The work
remains the same as it was prior to the sale. An
undertaking which is divided between two compa
nies, one of which operates its local aspects and
another its inter-provincial aspects, effectively
becomes two separate undertakings which may be
judged separately. The same should not be said of
an interprovincial work which is notionally
divided".
6 For a discussion and an analysis of the cases on the
distinction between a work and an undertaking, see Neil Fin-
kelstein, Laskin's Canadian Constitutional Law, vol. 1, 5th ed.
Toronto: Carswell 1986, at pp. 628-629.
Even if I am wrong in thinking that the Stettler
Subdivision comes under paragraph 92(10)(a) of
the Constitution Act, 1867, I would still see it as
falling under federal jurisdiction by operation of
paragraph 92(10)(c). Indeed, in my understanding
of its history, it has more than once been declared
by Parliament to be for the general advantage of
Canada, and there is no reason to believe that
these declarations have been expressly or tacitly
repealed since or for some other reason have
become ineffective.
The Stettler Subdivision is a rail line which was
part of the Canadian Northern Railway system by
virtue of an amalgamation between the Alberta
Midland Railway Company and the Canadian
Northern Railway Company, in July 1909. By
1919, the Government of Canada had acquired
ownership and control of the Canadian Northern
Railway Company. In that year, An Act to incor
porate Canadian National Railway Company and
respecting Canadian National Railways, S.C.
1919, c. 13 created the CNR and authorized the
Crown to transfer the stock of Canadian Northern
Railway to the CNR. Section 18 of that Act read
as follows:
18. The works of any of the Companies comprised in the
Canadian Northern System which have not heretofore been
declared to be works for the general advantage of Canada are
hereby declared to be works for the general advantage of
Canada, and the works of any Company or Companies hereaf
ter from time to time declared by the Governor in Council to be
comprised in the Canadian Northern System are hereby
declared from and after the date of the making of such
declaration by the Governor in Council to be works for the
general advantage of Canada.
A first schedule to that Act listed, as the first
constituent company, The Canadian Northern
Railway Company, and a second schedule identify
ing the lines of railway constructed by the Canadi-
an Northern Western Railway Company referred
specifically to what appears to me to be the line
that was to become known as the Stettler Subdivi
sion, when it spoke of a line "from a point on the
constructed line between Big Valley and Stettler,
south-easterly to a junction with the Saskatoon-
Calgary line". This was a first declaration which
still appears, with only slight modifications as to
its form, in subsection 18 (1) of the present
Canadian National Railways Act [R.S.C. 1970, c.
C-10].'
It is not the only one. The Railway Act, R.S.C.
1970, c. R-2 contains a declaration to the same
effect. It is to be found in paragraph 6(1)(c) which
provides as follows:
6. (1) The provisions of this Act, without limiting the effect
of section 5, extend 'and apply to
(c) every railway or portion thereof, whether constructed
under the authority of the Parliament of Canada or not, now
or hereafter owned, controlled, leased, or operated by a
company wholly or partly within the legislative authority of
the Parliament of Canada, or by a company operating a
railway wholly or partly within the legislative authority of
the Parliament of Canada, whether such ownership, control,
or first mentioned operation is acquired or exercised by
purchase, lease, agreement or other means whatsoever, and
whether acquired or exercised under authority of the Parlia
ment of Canada, or of the legislature of any province, or
otherwise howsoever; and every railway or portion thereof,
now or hereafter so owned, controlled, leased or operated
shall be deemed and is hereby declared to be a work for the
general advantage of Canada.
I see no reason why these declarations which are
among the basic provisions of two of the most
important federal statutes should be denied their
full constitutional meaning and effect. An atempt
to raise doubt as to their validity or applicability
was made on behalf of the applicant but, in my
view, to no avail.
To dispute the validity of the declaration, two
lines of argument were adopted. It was suggested
first that the declarations were unconstitutional
because they were too general and lacked the
specificity required for them to be fully meaning
ful. The argument was suggested by an opinion
expressed by Mr. Justice Duff (as he then was) in
the course of his reasons in the case Luscar Col
lieries Ltd. v. McDonald, [1925] S.C.R. 460;
[1925] 3 D.L.R. 225. But as I read the comments
of Duff J. to which reference was made (at pages
7 It now reads thus:
18. The railway or other transportation works in Canada
of the National Company and of every company mentioned
or referred to in Part I or Part I1 of the schedule and of every
company formed by any consolidation or amalgamation of
any two or more of such companies are hereby declared to be
works for the general advantage of Canada.
476-477 S.C.R.; 236-237 D.L.R.), the concern of
the learned Justice was with respect to works not
yet executed and even not yet in contemplation of
being executed. I fail to see how a declaration
which clearly refers to works already in existence
could be considered non-existent simply because
its terms would be said to be too general.
It was argued more specially that the declara
tions were void, in so far as the Stettler Subdivi
sion was concerned, because, at the time they were
enacted, that line was already an indivisible part of
an interprovincial railway and as such did not need
to be declared for the general advantage of
Canada to fall under federal jurisdiction. I am not
sure that the argument could even be advanced
with respect to the very first specific declaration of
1911, and, in any event, it does not impress me.
Even if the declarations were, when enacted,
"unmeaning" or "unnecessary", as was said by
some judges to underline that they had then no
independent constitutional consequence, it does not
follow that they can simply be ignored as if they
have never been made. Parliament, in its wisdom,
has seen fit to make the declarations in spite of
their possible so-called "unmeaningness" no doubt
for some reason, which reason may well be, if not
only for greater certainty, to cover eventual sever
ances like the one which occurred here.
The objections to the applicability of the decla
rations, assuming their validity, were again two
fold. It was said that the Stettler Subdivision was
no longer covered, since it was no longer owned by
one of the companies referred to and identified in
the statutory provisions. The argument was based
on the assumption that the reference to ownership
in the declarations was made not merely as a
means of identification of the works but as a
necessary qualification. I do not agree with that
assumption. It is the work which has been declared
for the advantage of Canada and I fail to see how
it could have been contemplated that it would
cease to be so, not as a result of a transformation
in its use and operation, but as a mere change in
the corporate entity owning it. It was said finally
that, if the Stettler Subdivision was initially cov
ered by the declarations, the approval of its sale by
the Governor General in Council, pursuant to sec
tions 23 and 31 of the Canadian National Rail
ways Act, had had the effect of putting an end to
any consequence that could have derived there
from. This ultimate argument seeks support in the
decision of the Supreme Court in Montreal Tram-
ways Co. v. Lachine, Jacques-Cartier and Mai-
sonneuve Railway Co. (1914), 50 S.C.R. 84 where
the majority expressed the opinion that the author
ization, by special Act of Parliament, of the sale,
to a provincial company, of some property of a
Dominion railway had, by necessary implication,
rendered ineffective a declaration that had previ
ously been made with respect to that property. The
distinction however is obvious. Parliament can
rescind at any time its own declaration; I know of
no power of the sort in the Governor General in
Council.
I have taken care to discuss and reject each of
the arguments advanced in support of the proposi
tion that federal jurisdiction over the Stettler Sub
division cannot come from a declaration under
paragraph (c) of head 10 of the Constitution Act,
1867. But behind my reply to the various points
raised, it will have been seen that my overall
reaction is similar to that which I had when I
analysed the situation under paragraph (a). I
cannot accept that the effect of a declaration of
national interest by Parliament could be made to
disappear, without the express intervention of Par
liament itself, any more than I could be convinced
that the interprovincial character of a portion of a
national railway system could disappear simply by
a change of ownership. Indeed, it would seem quite
inappropriate if a change in the constitutional
characterization of a "matter" could be effected
by a mere sale between corporate persons with no
corresponding change in the underlying constitu
tional values that determined the classification in
the first instance. So, in my judgment, the Stettler
Subdivision is not only a railway connecting sever-
al provinces within the meaning of paragraph
92(10(a) of the Constitution Act, 1867, it is also a
work with respect to which declarations under
paragraph 92(10) (c) of that Act are in full effect.
Is this situation determinative of the issue before
us? It is if one is entitled to deduce, from the fact
that the Stettler Subdivision is a federal work, that
the labour relations of Central Railway fall under
federal jurisdiction and are to be governed by Part
V of the Canada Labour Code. And I think that
this is indeed the case, a view manifestly shared by
all counsel none of them having disputed it, but I
realize that there is a difficulty.
It may be said that the federal character of the
Stettler Subdivision, as a railway under paragraph
92(10)(a) or as a work under paragraph
92(10)(c), ought not to be extended to Central
Railway the undertaking on the sole basis of the
relation between the two. The argument could be
that there is no reason why federal works should
not be used by provincial undertakings, and sup
port could be sought in those cases which have now
clearly established that the construction, repair or
maintenance of a federal work could be carried out
by an undertaking without the labour relations
falling under federal jurisdiction. (See, for exam
ple, Construction Montcalm Inc. v. Minimum
Wage Commission, [ 1979] 1 S.C.R. 754; Re
Canada Labour Code (1986), 72 N.R. 348
(F.C.A.)). It is my opinion, however, that a basic
difference must be seen here between, on the one
hand, an undertaking which is only called upon to
participate in the construction, repair or mainte
nance of a federal work, or which happens to use
such a work to conduct its operations and, on the
other hand, the undertaking whose sole reason for
being is to operate on a continuing basis the
federal work, to exploit its productive capacity, to
make it produce, so to speak, the "national general
benefit" expected from it. The national dimension
present in the case of the latter, makes it normal, it
seems to me, that the federal character of the work
would attract federal jurisdiction over all essential
aspects of the operation thereof. This, in any event,
is the position taken by Parliament in enacting
section 108 of the Canada Labour Code which
reads:
108. This part applies in respect of employees who are
employed upon or in connection with the operation of any
federal work, undertaking or business and in respect of the
employers of all such employees in their relations with such
employees and in respect of trade unions and employers' organ
izations composed of such employees or employers. (I under
lined the words I consider most significant in support of my
proposition.)
These are the reasons why I think that the
decision of the Board was right and that this
application should be dismissed.
* * *
The following are the reasons for judgment
rendered in English by
HUGESSEN J. (dissenting): Central Western
Railway Corporation is a company incorporated
by an Act of the Legislature of Alberta. It runs a
railway. The trackage is located wholly within
Alberta and consists of a little over one hundred
miles of the former Canadian National Railway
line connecting Edmonton and Calgary. It pur
chased the line and the right-of-way (but no roll
ing stock) from the CNR. The line was previously
known as the Stettler Subdvision of the CNR.
Prior to the sale, the line interconnected with the
CNR's line but it no longer does so. CN has
installed and controls a device known as a "locked
open point derail" at the place where the two lines
meet. This device physically separates the system
of Central Western from that of CN by a gap
large enough to derail any train passing over it
while it is open. Thus, without CN's permission,
traffic cannot pass from Central Western's line
onto CN's line or vice versa.
Central Western owns three locomotives, which
it purchased elsewhere, as well as some other
miscellaneous rolling stock. The vast bulk of its
business is the transportation of grain. This grain
is carried in rail cars which are owned by neither
CN nor Central Western. CN brings them empty
to the terminus of Central Western's line, whence
Central Western takes them to a number of grain
elevators along the route, where they are spotted;
when the cars are filled with grain, Central West
ern brings them back to its terminus point, where
CN picks them up and takes them on its main line
to various points outside Alberta.
Central Western has eight employees including
the president and vice-resident. The only question
to be determined on this section 28 application is
whether Central Western's labour relations are
subject to federal jurisdiction. The Canada Labour
Relations Board so found in the decision under
review.
The rule in labour relations in Canada is provin
cial competence; federal jurisdiction is exceptional.
The locus classicus is found in the six principles
stated by Dickson J. (as he then was) in Northern
Telecom Ltd. v. Communications Workers of
Canada, [1980] 1 S.C.R. 115 (Northern Telecom
No. 1), at page 132:
(I) Parliament has no authority over labour relations as such
nor over the terms of a contract of employment; exclusive
provincial competence is the rule.
(2) By way of exception, however, Parliament may assert
exclusive jurisdiction over these matters if it is shown that such
jurisdiction is an integral part of its primary competence over
some other single federal subject.
(3) Primary federal competence over a given subject can pre
vent the application of provincial law relating to labour rela
tions and the conditions of employment but only if it is demon-
strated that federal authority over these matters is an integral
element of such federal competence.
(4) Thus, the regulation of wages to be paid by an undertak
ing, service or business, and the regulation of its labour rela
tions, being related to an integral part of the operation of the
undertaking, service or business, are removed from provincial
jurisdiction and immune from the effect of provincial law if the
undertaking, service or business is a federal one.
(5) The question whether an undertaking, service or business is
a federal one depends on the nature of its operation.
(6) In order to determine the nature of the operation, one must
look at the normal or habitual activities of the business as those
of "a going concern", without regard for exceptional or casual
factors; otherwise, the Constitution could not be applied with
any degree of continuity and regularity.
As was made clear in that case and in the
subsequent decision in Northern Telecom Canada
Ltd. et al. v. Communication Workers of Canada
et al., [1983] 1 S.C.R. 733 (Northern Telecom
No. 2), federal jurisdiction in labour relations is
engaged not only where there is a primary federal
undertaking but also where there is a subsidiary
undertaking which is physically and operationally
integrated into a core federal undertaking.
The question thus becomes whether Central
Western is itself a primary federal undertaking or
is functionally integrated with some other core
federal undertaking so as to make its labour rela
tions subject to the Canada Labour Code.' That
question, in its turn, requires a consideration of the
provisions of subsections 91(29) and 92(10) of the
Constitution Acts, 1867 to 1982:
91. It shall be lawful for the Queen, by and with the Advice
and Consent of the Senate and House of Commons, to make
Laws for the Peace, Order, and good Government of Canada,
in relation to all Matters not coming within the Classes of
Subjects by this Act assigned exclusively to the Legislatures of
the Provinces; and for greater Certainty, but not so as to
restrict the Generality of the foregoing Terms of this Section, it
is hereby declared that (notwithstanding anything in this Act)
the exclusive Legislative Authority of the Parliament of
Canada extends to all Matters coming within the Classes of
Subjects next hereinafter enumerated; that is to say,-
29. Such Classes of Subjects as are expressly excepted in the
Enumeration of the Classes of Subjects by this Act
assigned exclusive to the Legislatures of the Provinces.
8 R.S.C. 1970, c. L-1.
92. In each Province the Legislature may exclusively make
Laws in relation to Matters coming within the Classes of
Subjects next hereinafter enumerated; that is to say,-
10. Local Works and Undertakings other than such as are
of the following Classes:—
(a) Lines of Steam or other Ships, Railways, Canals,
Telegraphs, and other Works and Undertakings con
necting the Province with any other or others of the
Provinces, or extending beyond the Limits of the
Province;
(b) Lines of Steam Ships between the Province and any
British or Foreign Country;
(c) Such Works as, although wholly situate within the
Province, are before or after their Execution declared by
the Parliament of Canada to be for the general Advan
tage of Canada or for the Advantage of Two or more of
the Provinces.
Subsection 92(10) speaks of both "works" and
"undertakings". In my view, it is essential to a
proper understanding of the text to bear this fact
in mind and to know that "works" and "undertak-
ings" are two quite separate things.
In Montreal City v. Montreal Street Railway
Company, [1912] A.C. 333, Lord Atkinson, speak
ing for the Privy Council and referring particularly
to the words of paragraph 92(10)(c), said [at page
342]:
These works are physical things, not services.
The words of Lord Atkinson were repeated by
Viscount Dunedin, speaking for the Privy Council,
In re Regulation and Control of Radio Communi
cation in Canada, [1932] A.C. 304, at page 315,
where he went on to draw the obvious distinction
between the "works" alone of paragraph 92(10)(c)
and the "works and undertakings" of paragraph
92(10)(a):
"Undertaking" is not a physical thing, but is an arrangement
under which of course physical things are used.
The Privy Council returned to the matter in
Attorney-General for Ontario v. Israel Winner,
[1954] A.C. 541. Lord Porter, speaking for the
Board, said, at pages 571-572:
The first proposition involves a close and careful consider
ation of the terms and effect of section 92(10)(a). The argu-
ment was put in a number of ways. In the first place it was said
that works and undertakings must be read conjunctively, that
the subsection has no operation unless the undertaking is both a
work and an undertaking—the former a physical thing and the
latter its use. There was, it was maintained, in the present
instance no work, and the existence of a work was an essential
element in order to make the subsection applicable. The neces
sity for the existence of both elements might, it was said, be
illustrated by considering the case of a railway, where there was
both a track and the carriage of goods and passengers over it,
and in constructing the words "works and undertaking" regard
must be paid to the words associated with them in the
subsection.
Their Lordships do not accept the argument that the combi
nation of a work and an undertaking is essential if the subsec
tion is to apply. Perhaps the simplest method of controverting it
is to point out that the section begins by giving jurisdiction to
the provinces over local works and undertakings. If, then, the
argument were to prevail, the province would have no jurisdic
tion except in a case where the subject-matter was both a work
and an undertaking. If it were not both, but only one or the
other, the province would have no authority to deal with it, and
at any rate under this section local works which were not also
undertakings and local undertakings which were not works
would not be subject to the jurisdiction of the province—a
result which, so far as their Lordships are aware, has never yet
been contemplated. Moreover, in subsection (l0)(c) the word
"works" is found uncombined with the word "undertakings," a
circumstance which leads to the inference that the words are to
be read disjunctively so that if either works of udertakings
connect the province with others or extend beyond its limits, the
Dominion, and the Dominion alone, is empowered to deal wth
them.
The case of steamships is an even more potent example of the
difficulty of reconciling the suggested construction with the
wording of the section. Lines of steamships between the prov
ince and any British or foreign country can carry on their
operations without the existence of any works. The only con
necting link which they provide is by passing to and fro from
the one to the other. Their Lordships must accordingly reject
the suggestion that the existence of some material work is of
the essence of the exception. As in ships so in buses it is enough
that there is a connecting undertaking.
That works are separate and distinct from
undertakings and that the two words are to be read
disjunctively in subsection 92(10) was again con
firmed by the Supreme Court in Commission du
Salaire Minimum v. Bell Telephone Company of
Canada, [1966] S.C.R. 767, at page 772.
Finally there is the assertion, in my respectful
view incontrovertible, by Rand J. in the Stevedor-
ing reference [at page 553]: 9
Undertakings, existing without works, do not appear in
92(10)(c) and cannot be the subject of such a delaration. 10
If I have found it necessary to insist on the
distinction between "works" and "undertakings",
it is because the word "railway" is often used
interchangeably to designate either. As a work, a
railway is a line of track and the attendant right-
of-way and installations; as an undertaking, it is a
business with assets (including, but not by any
means limited to, the railway work) and
employees.
Against this background, three possible routes
have been suggested by which Central Western's
labour relations may be subject to federal jurisdic
tion. These are:
1. That Central Western is itself a primary
federal work or undertaking within the meaning of
paragraph 92(10) (a);
2. That Central Western is a subsidiary under
taking which is functionally integrated with a core
federal undertaking so as to bring its labour rela
tions under federal control. Three possible federal
core undertakings are identified:
A. The CNR;
B. The grain elevators lying along the Central
Western line;
9 Reference re Industrial Relations and Disputes Act, [1955]
S.C.R. 529.
1° I cannot accept the view propounded by some commenta
tors that this passage is support for the proposition that under
takings existing with works can be subject to a paragraph
92(10)(c) declaration. See P. Schwartz "Fiat by Declaration"
(1960-63) 2 Osgoode Hall L.J. 1; Andrée Lajoie, Le pouvoir
déclaratoire du Parlement, Montréal, Les Presses de l'Univer-
sité de Montréal, 1969. This interpretation seems to postulate a
drafting error, either in the omission of "undertakings" from
paragraph (c) or in their inclusion in paragraph (a); it also
ignores the very express judicial opinions which I have quoted.
For a better view, see I. H. Fraser, "Some comments on
subsection 92(10)(c) of the Constitution Act, 1867", (1983-84)
29 McGill L.J. 557. The latter author gives a particularly
helpful and rigorous analysis of paragraph 92(10)(c) and the
various attempts at its interpretation.
C. The "western grain transportation network".
3. That Central Western is a work which has
been made the object of a declaration under para
graph 92(10)(c).
Each of these must be examined in turn.
1. Central Western as a primary federal work or
undertaking
The proposition that Central Western is a work
or undertaking connecting Alberta with any other
provinces or extending beyond the limits of Alber-
ta was not accepted by the Board and was not
urged before us with any vigour. It can, I think, be
disposed of fairly readily. As a work, the line of
Central Western is wholly contained within the
limits of Alberta and is physically separated from
the line of the CNR, which connects with other
provinces. The only decision which could conceiv
ably support federal jurisdiction is Luscar Collier
ies v. McDonald, [1927] A.C. 925 (P.C.). That
decision concerns a branch line over which trains
could pass directly onto the interprovincial line
and which was, in fact, operated by an interprovin-
cial railway undertaking. Neither of those condi
tions exist here. Indeed the situation of Central
Western is even stronger than that which obtained
in British Columbia Electric Ry. Co. Ltd. et al. v.
Canadian National Ry. Co. et al., [1932] S.C.R.
161, where a branch which made direct connection
at each end with interprovincial railways but
which was owned and operated by a provincial
undertaking was held not to be subject to federal
jurisdiction. "
" See also Kootenay & Elk Railway Co. v. Canadian Pacific
Railway Co., [19741 S.C.R. 955, which upheld provincial
jurisdiction over a railway which was to run to within one-quar
ter of an inch of the international boundary at a point where
another railway was to run to within one-quarter of an inch of
the other side of the boundary. The authority of the case is
perhaps weakened, however, not only by strong dissenting views
but also by the fact that the railway had not, in fact, been built
and the decision dealt only with the project rather than with the
reality.
Nor can Central Western as a railway undertak
ing be seen as connecting Alberta with other prov
inces or extending beyond provincial limits. The
employees of Central Western never take their
trains off their employer's trackage and they could
not, even if they wanted to, drive the the rolling
stock onto a line which might eventually lead them
beyond provincial boundaries.
2. Central Western as a subsidiary undertaking
integrated to a core federal undertaking
A. The CNR—There is no indication whatever
that the CNR is in any way dependant upon
Central Western for its operations. Quite the con
trary. CN sold the Stettler Subdivision to Central
Western and had for some years prior to the sale
been attempting to abandon the line. The fact that
Central Western may be wholly dependent on CN
in order to carry out its railway undertaking is, of
course, irrelevant for our purposes since it has
never been the case that a provicial undertaking
became subject to federal jurisdiction simply
because it is wholly dependent for its existence on
a federal undertaking; the freight forwarders deci
sions are a good illustration of this. ' 2
B. The grain elevators—These are federal
works having been declared to be for the general
advantage of Canada by Parliament pursuant to
paragraph 92(10)(c). As has been indicated, how
ever, that declaration can only operate with
respect to a work and not an undertaking. They
are not part of the railway works. As undertakings,
the elevators are as functionally distinct from the
railway as they are from the farmers' trucks which
deliver grain to them. An elevator serves for the
receipt, grading, handling and storage of grain but
not for its transportation. And even if the shipping
of grain was seen as being essential to the function
of an elevator (as opposed to its use), it is not by
any means clear that such function is dependent
upon the railway.
' 2 See Cannet Freight Cartage Ltd. (In re), [1976] 1 F.C. 174
(C.A.); Re The Queen and Cottrell Forwarding Co. Ltd.
(1981), 124 D.L.R. (3d) 674 (Ont. Div. Ct.).
C. "Western grain transportation network"—
This was the principal basis upon which the Board
founded its decision. In my view and with respect,
it is simply untenable to view the "western grain
transportation network" as being a core federal
undertaking. At the most basic level, it cannot be
regarded as an undertaking at all since there is no
identifiable person or corporation which acts as
undertaker. The very expression "western grain
transportation network" appears to be a construct
based on the references in Northern Telecom No.
2 to Bell's interprovincial telecommunications net
work. The distinction is, of course, obvious. The
Bell network is an identifiable undertaking with a
single integrated direction. The "western grain
transportation network" is an agglomeration of
persons, things and policies. It is an abstraction.
Indeed the concept represents a quantum leap in
the extension of federal jurisdiction. If there is
really a national grain transportation network such
as to support federal jurisdiction over every local
grain transportation undertaking, it must presum
ably extend to road transportation of grain as well.
Also the finding in Northern Telecom No. 2 would
result in the federal jurisdiction over every provin
cial telephone company which was linked to or
formed part of a national "Canadian telecommuni
cations network". Those are propositions which I
cannot accept.
3. Central Western as a work declared to be for
the general advantage of Canada
Immediately prior to the sale by CNR to Cen
tral Western, the line was the subject of a declara
tion under paragraph 92(10)(c). That statutory
declaration had existed in varying forms since the
days when the line had been the property of the
Canadian Northern Railway. Its most recent form
appears in subsection 18(1) of the Canadian Na
tional Railways Act. 13 The relevant words read:
13 R.S.C. 1970, c. C-10.
18. (I) The railway or other transportation works in
Canada of the National Company ... are hereby declared to be
works for the general advantage of Canada.
Here again the distinction between works and
undertakings is vital. 14 What has been declared to
be for the general advantage of Canada are the
works of CNR. For the purposes of our case, that
means the line of tracks comprising the Stettler
Subdivision. It does not mean the undertaking
carried out by the CNR on those tracks. If it did,
the declaration would, of course, have ceased to
have effect as soon as the CNR sold the right-of-
way and stopped carrying on its undertaking there
on. As it is, however, since the declaration envis
ages only works or physical things, those works do
not change or become any less for the general
advantage of Canada by reason of a simple change
in their ownership. 15 I am, accordingly, of the view
that Central Western's line, as a work, continues
to be subject to the declaration and therefore to
fall within federal jurisdiction.
That does not resolve the question, however.
There is, as far as I am aware, no case which holds
that labour relations are subject to federal jurisdic
tion simply because the labour is performed on or
in connection with a federal work. That is hardly
surprising. Works, being physical things, do not
have labour relations. Undertakings do. In the
passage from Northern Telecom No. 1 quoted at
the beginning of these reasons, Dickson J. is care
ful to talk of the labour relations of an "undertak-
14 Paragraph 2(h) of the Canada Labour Code asserts federal
jurisdiction over
2....
(h) a work or undertaking that, although wholly situated
within a province, is before or after its execution declared
by the Parliament of Canada to be for the general advan
tage of Canada or for the advantage of two or more of the
provinces....
As I have attempted to show, this provision is constitutionally
incompetent in so far as it extends to undertakings not other
wise within federal authority. As can be seen, however, subsec
tion 18(l) only touches the "works" of the CN R.
15 It might well be otherwise if the line were abandoned;
would it then cease to be a railway work? The point does not
arise for decision here.
ing, service or business". There is of course no
reason why federal works should not be used by
provincial undertakings to conduct their opera
tions. Thus it has been held that a provincial
railway may interconnect with and run its trains
over the tracks of a railway which is federal by
virtue of a paragraph 92(10)(c) declaration with
out thereby losing its provincial character: Mon-
treal City v. Montreal Street Railway Company,
supra.
It seems clear also that the construction, repair
or maintenance of a federal work is not a matter
which is for that reason subject to federal labour
relations jurisdiction. It is difficult to conceive of a
work more federal in character than an airport or
a bridge on the transcontinental railway line but
the Supreme Court, in Construction Montcalm
Inc. v. Minimum Wage Commission, [1979] 1
S.C.R. 754, and this Court, in Canada Labour
Code (Re), [1987] 2 F.C. 30, have held that they
were subject to provincial labour jurisdiction. In
the same vein, it has been held that undertakings
engaged in the construction of interprovincial
pipelines 16 or federal wharves" (both of which are
clearly "works") are subject to provincial labour
relations legislation. The other side of that coin is
that municipal employees who operate an airport,
viewed as an undertaking rather than a mere
physical work,' 8 are under federal labour relations
jurisdiction. 19
16 Henuset Rentals Ltd. v. United Association of Journeymen
and Apprentices of the Plumbing and Pipefitting Industry,
Local Union 488 (1981), 6 Sask. R. 172 (C.A.).
17 Re Maritime Engineering Limited, Labourers' Interna
tional Union of North America, Local 1115, and Attorney
General of Nova Scotia (1979), 33 N.S.R. (2d) 484
(S.C.A.D.).
" The word "airport", like "railway", may be used to desig
nate either a work or an undertaking.
" Kelowna v. Labour Relations Bd. of B.C. et al., [1974] 2
W.W.R. 744 (B.C.S.C.).
It is difficult to know the precise extent of
federal jurisdiction over a work declared to be for
the general advantage of Canada under paragraph
92(10)(c). It is perhaps unwise that we attempt to
trace the limits here. Certainly it would appear, to
paraphrase Beetz J. in Construction Montcalm
Inc., supra, to extend to decisions as to whether
and where to construct the work, its design, dimen
sions and the materials to be employed.
It may well be that, as suggested by some
commentators, the effect of a declaration under
paragraph 92(10(c) is
... to bring within federal authority not only the physical shell
or facility but also the integrated activity carried on therein 20
The cases cited to support this proposition, how
ever, do not extend federal jurisdiction beyond
what is necessary to the regulation of the use of
the work itself. R. v. Thumlert (1959), 28 W.W.R.
481 (Alta. S.C.A.D.); and Chamney v. The Queen,
[1975] 2 S.C.R. 151, deal with federal regulation
of the type, quantity and manner of receipt of
grain into elevators which have been declared to be
works for the general advantage of Canada. As
stated by Martland J. in the latter case [at page
159], the result of the declaration was
that Parliament could control the quantities of grain which
could be received into an elevator ....
There is, however, no authority for holding that
federal jurisdiction extends generally to all the
operations of persons using or owning the work
and particularly to their labour relations.
I return again to the governing principle. This is
how it was stated by Beetz J. in Construction
Montcalm, supra [at pages 768-769]:
The issue must be resolved in the light of established princi
ples the first of which is that Parliament has no authority over
labour relations as such nor over the terms of a contract of
20 Neil Finkelstein. Laskin's Canadian Constitutional Law,
vol. 1; 5th edition, Toronto: Carswell, 1986, at p. 629; Peter W.
Hogg, Constitutional Law of Canada, 2nd edition, Toronto:
Carswell, 1985, at p. 492.
employment; exclusive provincial competence is the rule:
Toronto Electric Commissioners v. Snider [[1925] A.C. 396].
By way of exception however, Parliament may assert exclusive
jurisdiction over these matters if it is shown that such jurisdic
tion is an integral part of its primary competence over some
other single federal subject: In re the validity of the Industr:.1
Relations and Disputes Investigation Act [[1955] S.C.R. 529]
(the Stevedoring case). It follows that primary federal compe
tence over a given subject can prevent the application of
provincial law relating to labour relations and the conditions of
employment but only if it is demonstrated that federal author
ity over these matters is an integral element of such federal
competence; thus, the regulation of wages to be paid by an
undertaking, service or business, and the regulation of its
labour relations, being related to an integral part of the opera
tion of the undertaking, service or business, are removed from
provincial jurisdiction and immune from the effect of provincial
law if the undertaking, service or business is a federal one ....
The undertaking and business of Central West
ern are provincial and local in character. Its track-
age and right-of-way are subject to federal juris
diction by virtue of a declaration under paragraph
92(10)(c). Federal authority extends to the use
which may be made of the track but regulation of
the labour relations of the user is not an integral
element of that authority. Effective control of the
work does not require control of the undertaking.
Accordingly, the Canada Labour Relations Board
had no jurisdiction to make the decision under
review.
I would allow the section 28 application and set
aside the impugned decision of the Canada Labour
Relations Board.
* * *
The following are the reasons for judgment
rendered in English by
LACOMBE J.: I have had the advantage of read
ing in draft form the reasons for judgment of Mr.
Justice Marceau and Mr. Justice Hugessen. I
concur in the final result reached by Marceau J.
that this section 28 application be dismissed; with
respect however, I disagree with him that Central
Western comes under the jurisdiction of the
Canada Labour Relations Board because it is still
an integral part of an interprovincial railway. In
addition to Hugessen J.'s cogent reasons that it is
not so, I would make the following observations.
Only counsel for the respondent, the Brother
hood of Locomotive Engineers made the argument
that this line of railway is subject to federal juris
diction under paragraph 92(10)(a) of the Consti
tution Act, 1867, independently on its own and
regardless of its relatedness to one or more of the
core federal undertakings identified by the Board.
To support this proposition, great reliance was
placed on the cases of Luscar Collieries v.
McDonald, [1927] A.C. 925 (P.C.); and Kootenay
& Elk Railway Co. v. Canadian Pacific Railway
Co., [1974] S.C.R. 955.
In its decision, the Board alluded to this argu
ment and, correctly in my view, rejected it. Case-
book, volume 16, page 2509:
Here, C.W.R.C.'s operations clearly do not extend beyond the
limits of the Province of Alberta, nor do they directly connect
Alberta with any of the other provinces. In this regard,
C.W.R.C. does not meet the tests for federal jurisdiction.
Before the sale to Central Western, the Stettler
Subdivision formed part of the CNR railway
system connecting the province of Alberta with
other provinces, and in addition, had been declared
by the Parliament of Canada to be for the general
advantage of Canada, pursuant to paragraph
92(10)(c) of the Constitution Act, 1867. It was
admittedly a federal work, business or undertaking
within the meaning of sections 2 and 108 of the
Canada Labour Code. The issue is therefore
whether the sale of the line to and its operation by
a provincially constituted company changed the
constitutional character of this railway.
The transaction which occurred in November
1986 effected drastic changes in the control, oper
ations and character of this line. The railway is
wholly situated within the province of Alberta,
extending for a distance of approximately 105
miles from Ferlow Junction in the south to Dino
saur Junction in the south-central area of the
province. Although the same commodity, export
grain is carried over its tracks, its operations as a
business are now confined within the boundaries of
the province, that of servicing nine grain elevators
located along its line, and operated by four grain
companies. Empty grain cars are delivered by
CNR trains at Ferlow Junction to Central West
ern, which then spots them at the various grain
elevators and, once filled by the grain companies,
returns them to Ferlow Junction, where they are
removed and carried to Vancouver by CNR trains.
After the sale, the Stettler line has been physi
cally disconnected and actually severed from CNR
tracks by a four-inch gap at both ends of the line,
so that Central Western's trains do not cross over
and do not travel on CNR tracks. Likewise, CNR
trains do not run on Central Western trackage. At
Ferlow Junction as well as at the other end, there
is a locked open derail device, under CNR control
which, when operated, permits access to Central
Western tracks by CNR locomotives only for the
purpose of delivering empty grain cars to and of
picking up loaded grain cars from Central West
ern. Central Western owns its locomotive equip
ment which cannot be moved off its tracks. Since
grain cars are owned by governmental authorities
and not by the CNR, its trains do not move CNR
property over its line nor do CNR trains carry any
grain over its tracks.
As a work or as an undertaking, the Stettler
Subdivision is no longer operated as a unit with the
rest of the CNR lines. Physically and operational
ly, it is not part of the CNR interprovincial rail
way system. The fact that it was so before the sale
is immaterial for constitutional adjudication pur
poses. It is now owned, managed and operated
exclusively by a provincially incorporated company
which is totally separate from the CNR. Literally
therefore, it is not a work or undertaking "con-
necting the Province with any other or others of
the Provinces, or extending beyond the limits of
the Province" within the meaning of paragraph
92(10)(a) of the Constitution Act, 1867; it does
neither of those things, that of connecting with
other provinces or extending beyond the limits of
the province.
In Luscar Collieries v. McDonald, [1927] A.C.
925 (P.C.), a local colliery company had built a
short line of railway to carry the coal from its
mine to another line which branched from the
CNR line extending beyond the province of Alber-
ta. By agreement, the Luscar line and the other
branch line were operated by the Canadian Na
tional Railways and traffic would pass without
interruption from these lines to such parts outside
the province of Alberta which were served by the
Canadian National system. The Privy Council,
affirming the Supreme Court of Canada, held that
the Luscar line was part of a system of railways
operated together and connecting the province of
Alberta with other provinces. Lord Warrington of
Clyffe wrote, at pages 932-933:
In the present case, having regard to the way in which the
railway is operated, their Lordships are of opinion that it is in
fact a railway connecting the Province of Alberta with others of
the Provinces, and therefore falls within s. 92, head 10(a), of
the Act of 1867. There is a continuous connection by railway
between the point of the Luscar Branch farthest from its
junction with the Mountain Park Branch and parts of Canada
outside the Province of Alberta.
It would appear that the fact that the local line
was, by agreement, operated by the same railway
company that owned and operated the rest of the
system connecting the province of Alberta with
other provinces was a material consideration for
the decision. Lord Warrington observed, at page
933:
If under the agreements hereinbefore mentioned the Canadian
National Railway Company should cease to operate the Luscar
Branch, the question whether under such altered circumstances
the railway ceases to be within s. 92, head 10(a), may have to
be determined, but that question does not now arise.
In British Columbia Electric Ry. Co. Ltd. et al. v.
Canadian National Ry. Co. et al., [ 1932] S.C.R.
161, Smith J., writing for the majority, referred to
the Luscar case, and said, at pages 169-170:
The decision is expressly put upon the way in which the
railway is operated by the Canadian National Railway Com
pany under the agreements, and it is intimated that if that
company should cease to operate the appellant's branch, the
question whether, under such altered circumstances, that
branch ceases to be within s. 92, head 10(a), might have to be
determined. The question thus left undetermined is the very
question that arises in the present case, because the Park line is
not operated by the Canadian National Railway Company, nor
by the appellant, the British Columbia Electric Railway Com
pany, as the operator of the Vancouver & Lulu Island Railway,
on behalf of the Canadian Pacific Railway.
The mere fact that the Central Park line makes physical
connection with two lines of railway under Dominion jurisdic
tion would not seem to be of itself sufficient to bring the
Central Park line, or the portion of it connecting the two
federal lines, within Dominion jurisdiction.
The Montreal Street Railway case referred to above seems
to be authority against that view.
In that case, the Supreme Court of Canada held
that the Board of Railway Commissioners, had no
jurisdiction over a one-mile line which formed a
direct connecting link between two lines of rail
ways under federal jurisdiction, one an interpro-
vincial railway, and the other, an intraprovincial
railway which had been declared to be for the
general advantage of Canada. This short stretch of
railways was held to be within provincial jurisdic
tion although it was operated by the same provin-
cially incorporated company that operated the
intraprovincial line which had been the subject of
the declaration by Parliament. The Court rejected
the argument that the line was part of a contin
uous system of railways extending beyond the
limits of the province.
The respondent Union attempted to make much
of the case of Kootenay & Elk Railway Co. v.
Canadian Pacific Railway Co., [1974] S.C.R. 955
to support its claim that the Stettler Subdivision,
even after its sale to C.W.R.C., was a work or was
still an integral part of a railway connecting the
province of Alberta with the rest of Canada. How
ever, in view of the number of conflicting and
rather confusing issues raised in that case, one
should not read into it more than what was actual
ly decided. One of the issues dealt with and clearly
determined by the Court concerned the powers of
a province to incorporate a company for the pur
pose of constructing a railway wholly situated
within the province, although at the time of incor
poration, it was envisaged that it could eventually
engage in extraprovincial activities. The Supreme
Court by a majority held, that a province has such
powers.
In addition, that case is clearly distinguishable
on the facts from the case at bar. The total project
in that case called for the construction of two lines
of railways on each side of the Canada-U.S.
border for the purpose of carrying coal mined in
British Columbia over the Canadian and Ameri-
can lines in the United States and thence back to a
point in British Columbia for shipment to Japan.
The Canadian company was not to have any roll
ing stock or equipment which would be supplied by
the U.S. railway and which the latter's crews
would bring into Canada and turn over to the
Canadian company's crews. The latter would take
the trains down to the coal mines for loading and
return them to a point on the Canadian side of the
border where they would be taken over by the U.S.
railway's crews. The two lines were to be built
each within one-quarter of an inch from the border
on each side, but the one-half inch gap thus creat
ed in the trackage would not hinder the free
passage of trains over the respective tracks. There
would be complete physical and operational inte
gration of the two lines.
It should be noted that the two railway compa
nies had applied to the Canadian Transport Com
mission inter alia for an order granting leave to
join the two proposed railway lines and for leave to
the U.S. Railway to operate its trains on the
Canadian line for the purpose of providing a free
interchange of trains. The Commission had ruled
that it would have granted the applications if in its
view a provision of the Railway Act had not
prohibited the intended interchange of traffic be
tween the two lines, which ruling was overturned
by the Supreme Court.
It was therefore subsumed in the background of
that case that since the two lines were to be joined
together, the Canadian line, if and when construct-
ed, would be in fact and would be operated in fact
as a railway extending beyond the limits of the
province.
However, the Kootenay case has not repudiated
the authority of the decisions rendered in the
Montreal Street Railway case and the British
Columbia Electric Ry. case, supra. The point was
made crystal clear by Mr. Justice Martland. He
relied on them to affirm provincial jurisdiction to
incorporate a railway company in such peculiar
circumstances. Writing for Abbott and Ritchie JJ.,
he said at page 979:
The first point, which is clear, is that the Kootenay railway
would not connect the Province of British Columbia with any
other province, nor would it extend beyond the limits of the
province. In Montreal Street Railway Company v. The City of
Montreal, in the reasons for judgment delivered by Duff J., as
he then was, in this Court [(1910), 43 S.C.R., 197 at p. 227] it
was said, after referring to s. 92(10) and s. 91(29) of the
B.N.A. Act:
The exclusive authority to legislate in respect of a railway
wholly within a province is by virtue of these enactments
vested in the provincial legislature, unless that work be
declared to be for the general advantage of Canada; in that
case, exclusive legislative authority over it is vested in the
Dominion.
He then reviewed the Luscar Collieries case,
supra, more or less to distinguish it, pointing out
that the ground of decision was that the local line
was operated by the CNR and that because it was
so operated it had become a part of an interprovin-
cial railway system. He quoted extensively and
with approval from the reasons for judgment of
Smith J. in the British Columbia Electric Ry.
case, notably the passage, cited hereinabove, where
Smith J. held that physical connection of a short
line of railway, operated by a provincially incorpo
rated company, with two federal lines was insuffi
cient of itself to bring it within federal jurisdiction.
Immediately thereafter, Martland J. concluded his
reasons on the point by saying at page 982:
In summary, my opinion is that a provincial legislature can
authorize the construction of a railway line wholly situate
within its provincial boundaries. The fact that such a railway
may subsequently, by reason of its interconnection with another
railway and its operation, become subject to federal regulation
does not affect the power of the provincial legislature to create
it.
That case did not decide that the Kootenay line
was an extraprovincial undertaking. Martland J.
earlier in his reasons, said at page 979:
The respondent contends, however, that, while Kootenay's
works do not extend beyond the province, its undertaking was
not local in character. But in determining the legislative power
of the British Columbia Legislature to incorporate Kootenay
we are concerned with the nature of the undertaking which it
authorized. That undertaking is one which is to be carried on
entirely within the province.
The Kootenay case is a rather unusual case and
it is for that reason too uncertain a precedent from
which to draw any firm conclusion, which would
be applicable in the present case. On the authority
of the British Columbia Electric Railway decision,
which can hardly be distinguished from the facts
obtaining in this case, one is forced to conclude
that Central Western's railway is a local work and
undertaking, as it is no longer an integral part of
an interprovincial railway.
One is also driven to this conclusion if one
denies, as I do, that the CNR qualifies as a proper
core federal undertaking in order to bring Central
Western's labour relations into federal jurisdiction.
Under the principles enunciated by the Supreme
Court of Canada in the Northern Telecom
decisions 21 in order to trigger federal jurisdiction,
the subsidiary operation must be physically and
operationally integrated to the core federal under
taking. The Stettler Subdivision ceased to be a
part of the CNR railway system when it was
purchased by Central Western and the line was
physically disjoined from the CNR tracks after the
sale. If there is no physical and operational con
nection between Central Western and the CNR,
which could bring their relationship within the
rules of the Northern Telecom decisions, absent
such connection, Central Western cannot be said
to be still an integral part of an interprovincial
railway under paragraph 92(10)(a) of the Consti
tution Act, 1867. It is neither a subsidiary opera
tion to nor a territorial extension of the CNR
activities. It is an integral part of neither a core
21 Northern Telecom Ltd. v. Communications Workers of
Canada, [1980] 1 S.C.R. 115 and Northern Telecom Canada
Ltd et al. v. Communication Workers of Canada et al., [1983]
1 S.C.R. 733.
federal undertaking nor of an interprovincial
railway.
I share the views expressed by my colleagues
that none of the three core federal undertakings
identified by the Board, can form a proper basis
for upholding the board's jurisdiction in the
present case.
I agree with them that Central Western falls
within federal jurisdiction because, as a work, it is
still subject to the declaration made under para
graph 92(10)(c) of the Constitution Act, 1867. As
the Stettler Subdivision, it has been declared by
Parliament on more than one occasion to be for
the general advantage of Canada. The change in
its ownership did not alter the continuing effect of
the declaration, since only Parliament, not the
Governor in Council, can lift or repeal such decla
ration by a proper subsequent enactment. Hamil-
ton, Grimsby and Beamsville R. Co. v. Atty.-Gen.
for Ontario (1916), 29 D.L.R. 521 (P.C.). I am in
respectful disagreement with Hugessen J. that
Central Western's labour relations are within pro
vincial competence.
The Stettler Subdivision remains a federal rail
way line despite its acquisition by Central West
ern. There is a railway undertaking which is now
being carried on over this federal work by Central
Western and that fact makes the whole of the
undertaking, including its labour relations, to fall
within federal competence.
It will remain so as long as Central Western
operates its business on a line which continues to
be affected by the statutory declaration. The
Stettler Subdivision is in all respects as complete a
federal work as are all the other lines of our
national railway companies which are federal, the
statutory declarations notwithstanding, because
they extend beyond a particular province or con
nect one province with other provinces. It stands
on the same footing and is governed by the same
constitutional principles.
In this connection, it is worth recalling the
words of Lord Atkinson in Montreal City v. Mon-
treal Street Railway Company, [1912] A.C. 333
(P.C.), at page 339:
Railways so declared were in this case called "federal" railways
to distinguish them from railways situate wholly within a
province, and under the exclusive control of the provincial
Legislature styled provincial railways. It is admitted that by
this declaration the railway to which it refers was withdrawn
from the jurisdiction of the provincial Legislature, that it
passed under the exclusive jurisdiction and control of the
Parliament of Canada, and, small and provincial though it was,
stood to the latter in precisely the same relation, as far as the
enactments upon the true construction of which this case turns,
as do those great trunk lines, also federal railways, which
traverse the Dominion from sea to sea, and were originally
constructed and are now worked in exercise of the powers
conferred by the statutes of the Parliament of the Dominion of
Canada.
In The Queen in The Right of The Province of
Ontario v. Board of Transport Commissioners,
[1968] S.C.R. 118, the Supreme Court of Canada
held that a commuter train service owned and
operated by the province of Ontario came within
federal jurisdiction. The commuter service was
using its own rolling stock manned by train crews
from the CNR under an agency contract but was
utilizing the CNR tracks to run its trains. This
last-mentioned factor was the prime consideration
for the Court's conclusions that the then Board of
Transport Commissioners had jurisdiction to set
the tolls charged to the service users, as appears
from the following passage of the Court's joint
opinion, at page 127:
In the present case, the constitutional jurisdiction depends on
the character of the railway line not on the character of a
particular service provided on that railway line. The fact that
for some purposes the Commuter Service should be considered
as a distinct service does not make it a distinct line of railway.
From a physical point of view the Commuter Service trains are
part of the overall operations of the line over which they run. It
is clearly established that the Parliament of Canada has juris
diction over everything that physically forms part of a railway
subject to its jurisdiction.
Central Western's employees are engaged in the
day-to-day operations of a railway undertaking
carrying on its business as a going concern over a
federal work. They will not be employed in the
construction, maintenance or repair of a federal
work as was the case in Construction Montcalm
Inc. v. Minimum Wage Commission, [1979] 1
S.C.R 754. In Northern Telecom Canada Ltd. et
al. v. Communication Workers of Canada et al.,
[1983] 1 S.C.R. 733, Dickson J. (as he then was)
makes the point at page 773:
In Montcalm, once the airport was completed, the construction
workers would have nothing more to do with the federal
undertaking.
In the case at bar, the employees' involvement is
of an ongoing character and lies at the heart of the
employer's essential activities of operating a rail
way over a federal work. This was not so in the
case of: Canada Labour Code (Re), [ 1987] 2 F.C.
30 (C.A.), where construction workers of an
independent contractor were employed in the con
struction of steel and concrete bridges on CNR's
railway lines in British Columbia. They had noth
ing to do with the actual operation of the lines. In
the concluding paragraph of his reasons, Mac-
Guigan J. pointed out, at pages 51-52:
As the Board itself put it, "The reconstructed bridge is presum
ably expected to last a long time but the actual work does not."
The work here, whether thought of as construction or as
maintenance, is discrete in nature and temporary in duration.
Unlike that of the Northern Telecom installers, the work here
has no aspect of continuity or permanence. The work is limited
and terminal.
In the present state of the law, there cannot be
such a work-undertaking dichotomy, whereby in
the case of a railway company conducting its local
operations on a federal line, the labour relations of
the undertaking would be subject to provincial
jurisdiction, whereas all other aspects of the utili
zation of the line, qua federal work such as signals
and safety would be regulated by federal author
ity. The regulation of the conditions of employ
ment of Central Western's employees forms an
integral part of the primary federal competence
over the matter coming within the class of subject
mentioned in paragraph 92(10)(c) of the Consti
tution Act, 1867 and is directly related to the
day-to-day utilization of a federal work. It must be
emphasized that the Parliament of Canada, under
subsection 91(29), has exclusive legislative author
ity over all matters coming within such classes of
subjects as are expressly excepted in subsection
92(10) of the Constitution Act, 1867.
Unless and until the declaration by Parliament
ceases to have effect with respect to the Stettler
Subdivision, both the work and the undertaking of
Central Western are subject to federal jurisdiction.
It would be odd that, for example, the Canadian
Transport Commission would have jurisdiction
over Central Western's trackage, on which it oper
ates its railway undertaking, whereas the Canada
Labour Relations Board would be without jurisdic
tion over its employees by whom it carries its
business on and about the same declared federal
work. By way of exception to the general rule that
labour relations are within provincial competence,
federal competence over Central Western's labour
relations is an essential element of Parliament's
exclusive authority to make laws with respect to a
work it has declared to be for the general advan
tage of Canada.
For this reason, but for this reason alone, I
would dismiss this section 28 application.
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.