T‑640‑03
2005 FC 1320
Ontario Harness Horse Association (Applicant)
v.
Canadian Pari‑Mutuel Agency and Sudbury Downs Holdings, A Division of MacRanald Enterprises Incorporated (Respondents)
Indexed as: Ontario Harness Horse Assn. v. Canada (Pari‑Mutuel Agency) (F.C.)
Federal Court, Heneghan, J.—Toronto, March 29; Ottawa, September 27, 2005.
Construction of Statutes — Pari‑Mutuel Betting Supervision Regulations, s. 90(1)(d) — Judicial review of decision of Executive Director of Canadian Pari‑Mutuel Agency (CPMA) approving Sudbury Downs Holdings’ (Sudbury Downs) application to conduct inter‑track betting with various host tracks in Ontario, other provinces pursuant to s. 90(1)(d) — Applying principles of statutory interpretation, i.e. wording, context, scheme, object of legislation, policy considerations of Governor in Council, application for approval for inter‑track betting requiring executed Pre‑Licence Agreement (including details of scheduling of races, sharing of revenues) with horsemen under contract to racing association making application — Requirement same whether racing association applying as host, satellite track — Sudbury Downs fulfilled condition by providing CPMA with copy of executed Pre‑Licence Agreement with Northern Horsemen’s Association — S. 90(1)(c) requiring that racing associations (host, satellite tracks) have agreement with each other to conduct inter‑track betting — Agreement required between associations, not individual members of associations — Language of Regulations’ enabling statute (Criminal Code, s. 204(8), (9)) confirming Parliament’s intention Regulations provide effective, efficient pari‑mutuel betting supervision to protect betting public against fraudulent practices, help maintain viable racing industry — Regulatory Impact Analysis Statement relating to amendments of Regulations, s. 90(1)(d) stating requirements pertaining to execution of agreements between race track associations, horsemen under contract thereto when associations applying for betting permit — CPMA properly interpreting statutory requirements of Regulations, s. 90(1)(d).
Criminal Justice — Judicial review of decision of Executive Director of Canadian Pari‑Mutuel Agency (CPMA) approving Sudbury Downs Holdings’ (Sudbury Downs) application to conduct inter‑track betting with various host tracks in Ontario, other provinces pursuant to Pari‑Mutuel Betting Supervision Regulations, s. 90(1)(d) — Regulations enacted under Criminal Code, s. 204(8) — Pari‑mutuel betting form of betting in which individuals wagering on winning horses share in total amount bet by public, less percentage paid to racetrack operators — “Inter‑track betting” defined in Regulations, s. 2 as pari‑mutuel betting at satellite tracks on race at host track where money bet at host, satellite tracks pooled — Sudbury Downs racetrack racing association for purposes of Criminal Code, s. 204(11) — CPMA administering pari‑mutuel betting on horses in Canada in accordance with Regulations — Criminal Code, s. 204(1)(c)(ii) providing exemption from prohibition of wagering for bets made through pari‑mutuel system if compliance with Regulations — CPMA correctly interpreting, applying Regulations, s. 90(1)(d).
Administrative Law — Judicial Review — Standard of Review — Judicial review of decision of Executive Director of Canadian Pari‑Mutuel Agency (CPMA) approving Sudbury Downs Holdings’ (Sudbury Downs) application to conduct inter‑track betting with various host tracks in Ontario, other provinces pursuant to Pari‑Mutuel Betting Supervision Regulations, s. 90(1)(d) — Whether CPMA properly interpreted requirements of Regulations, s. 90(1)(d) question of law — Correctness applicable standard of review — Whether CPMA properly applied s. 90(1)(d) to Sudbury Downs’ application for inter‑track betting question of mixed fact and law — Standard of review reasonableness simpliciter — CPMA not erring by failing to consider fact Pre‑Licence Agreements negotiated between the Ontario Harness Horse Association (OHHA), host tracks contained provisions suggesting OHHA having to approve inter‑track betting before host track could participate — Satisfaction of condition precedent to Pre‑Licence Agreement issue for OHHA to resolve with each racing association with which having contract — Contractual dispute beyond scope of judicial review; not issue for CPMA, public — CPMA not erring in granting approval to Sudbury Downs’ application for inter‑track betting; decision not unreasonable.
Practice — Parties — Standing — Judicial review of decision of Executive Director of Canadian Pari‑Mutuel Agency (CPMA) approving Sudbury Downs Holdings’ (Sudbury Downs) application to conduct inter‑track betting with various host tracks in Ontario, other provinces pursuant to Pari‑Mutuel Betting Supervision Regulations, s. 90(1)(d) — Applicant not having standing to challenge CPMA’s decision — Federal Courts Act, s. 18.1(1) providing application for judicial review may be made by Attorney General of Canada, anyone directly affected by matter in respect of which relief sought — Provision broad enough to authorize recognition of standing even if applicant not “directly affected” where test for public interest standing met — Sudbury Downs, Northern Horsemen’s Association, racing associations with which Sudbury Downs intends to inter‑track bet affected by CPMA’s decision — No evidence applicant, horsemen represents directly affected by CPMA’s decision — Applicant also not having public interest standing since failed tri‑partite test — No serious issue raised — Applicant seeking to have Court enforce contractual obligations having no connection to CPMA’s decision — Applicant also not having genuine interest in matter since no evidence of harm to it by CPMA’s decision — Rather, applicant seeking to exclude racing associations not utilizing applicant as exclusive representative of horsemen under contract therewith — Finally, other “reasonable and effective way” to bring CPMA’s decision in issue before Court i.e. by party involved in application for approval.
This was an application for judicial review of the decision of the Executive Director of the Canadian Pari‑Mutuel Agency (CPMA), which was communicated to the applicant, approving Sudbury Downs’ application to conduct inter‑track betting with various host tracks in Ontario and in other provinces between March 26 and December 31, 2003, pursuant to paragraph 90(1)(d) of the Pari‑Mutuel Betting Supervision Regulations, enacted under subsection 204(8) of the Criminal Code. Pari‑mutuel betting is a form of betting in which individuals who wager on winning horses share in the total amount bet by the public, less a percentage paid to the racetrack operators. “Inter‑track betting” is defined in section 2 of the Pari‑Mutuel Betting Supervision Regulations as pari‑mutuel betting at satellite tracks on a race at a host track, where the money bet at the host, satellite tracks is pooled. The Ontario Harness Horse Association (OHHA) is a voluntary association representing approximately 5000 horsemen in Ontario. It negotiates agreements with racing associations concerning, among other things, the distribution of revenue from inter‑track betting. Sudbury Downs Holdings owns and operates a racetrack in Greater Sudbury. It is a racing association (as opposed to a horsemen’s association) for purposes of subsection 204(11) of the Criminal Code. The CPMA is responsible for the administration of pari‑mutuel betting on horses in Canada in accordance with the Regulations.
The Regulations require racetrack owners to apply for permits, authorizations and approvals (licences) to conduct various kinds of betting. When applying for a licence to conduct inter‑track betting, a racetrack must provide evidence of an executed agreement with the horsemen under contract to it for the period of the proposed licences. These agreements (Pre‑Licence Agreements) must cover the scheduling of races (Schedule) for, and the sharing of revenues (Split) from, the proposed inter‑track betting. Since the Regulations came into effect in 1991, the horsemen’s associations have negotiated and executed the Pre‑Licence Agreements on behalf of the horsemen, defined in section 2 of the Regulations.
In 1998, a number of horsemen in northern Ontario formed the Northern Horsemen’s Association (NHA), which has concluded Pre‑Licence Agreements with Sudbury Downs, incorporating the Schedule and the Split since that time. Meanwhile, the OHHA negotiated Pre‑Licence Agreements with several Ontario racing associations for 2003. A condition of those agreements was that the named racing associations, with one exception, would not participate in any form of inter‑track betting without the approval of the OHHA. The OHHA has not approved inter‑track betting with Sudbury Downs racetrack. In November 2002, Sudbury Downs applied to the CPMA for approval to conduct inter‑track betting for the year 2003. Based on the Pre‑Licence Agreement with the NHA, the CPMA approved Sudbury’s application for the period from March 26, 2003 to December 31, 2003, and notified the OHHA of its decision.
The issues were what was the applicable standard of review for decisions of the CPMA; whether Regulations, paragraph 90(1)(d) requires that before approval is given for inter‑track betting, both the host track and the satellite track have entered into Pre‑Licence Agreements with the horsemen under contract to them concerning the Schedule and Split from the proposed inter‑track betting; whether the CPMA erred in approving Sudbury Downs’ application to conduct inter‑track betting pursuant to paragraph 90(1)(d) of the Regulations; and whether the OHHA had standing to bring the application.
Held, the application should be dismissed.
As to the standard of review, the issue of whether the CPMA properly interpreted the requirements of paragraph 90(1)(d) of the Regulations was a question of law. Applying a pragmatic and functional analysis, the applicable standard of review was correctness. The issue of whether the CPMA properly applied paragraph 90(1)(d) was a question of mixed fact and law reviewable according to the standard of reasonableness simpliciter.
Applying the relevant principles of statutory interpretation, such as the wording, context, scheme and object of the legislation, as well as the policy considerations of the Governor in Council, paragraph 90(1)(d) requires, in applying for approval for inter‑track betting, an executed Pre‑Licence Agreement with the horsemen under contract to the racing association making the application, which agreement includes details of the Schedule and the Split. This requirement appears to be the same, whether the racing association is applying as a host track or a satellite track. Moreover, paragraph 90(1)(c) requires that the racing associations (host track and satellite track) have an agreement with each other to conduct inter‑track betting. It does not require that there be an agreement between the horsemen of one racing association and the racing association with which it intends to inter‑track bet and does not require that the horsemen under contract to the host track have an agreement or consent to inter‑track betting with a proposed satellite track. The agreement is between the associations, not individual members of the associations. The language of the Regulations’ enabling statute, that is subsections 204(8) and (9) of the Criminal Code, confirms the intention of Parliament that the Regulations provide effective and efficient pari‑mutuel betting supervision in order to protect the betting public against fraudulent practices, thereby helping to maintain a viable racing industry. Finally, the Regulatory Impact Analysis Statement relating to amendments of paragraph 90(1)(d) states that the requirements pertain to the execution of agreements between race track associations and the horsemen under contract to them when the associations apply for a betting permit. The CPMA properly interpreted the statutory requirements of paragraph 90(1)(d) of the Regulations.
The CPMA did not err in granting approval to Sudbury Downs’ application for inter‑track betting and its decision was not unreasonable. Sudbury Downs had fulfilled the statutory requirements by providing a copy of an executed Pre‑Licence Agreement with the NHA, which contained clauses setting out agreements for the Schedule and the Split. It had also submitted copies of the agreements between it and the host tracks with which it intended to inter‑track bet. At that stage, the CPMA’s approval was merely an authorization to conduct inter‑track betting. The CPMA did not err by failing to consider the fact that the Pre‑Licence Agreements negotiated between the OHHA and the host tracks contained provisions suggesting that the OHHA had to approve inter‑track betting before a host track could participate. The question of satisfaction of a condition precedent to a Pre‑Licence Agreement is a private issue for the OHHA to resolve with each of the racing associations with which it has a contract. That is a contractual dispute beyond the scope of judicial review and, consequently, was not an issue for the CPMA or for the public.
The applicant did not have standing to challenge the CPMA’s decision. Subsection 18.1(1) of the Federal Courts Act provides that an application for judicial review may be made by the Attorney General of Canada or by anyone directly affected by the matter in respect of which relief is sought. That provision is broad enough to authorize the recognition of standing even if the applicant is not “directly affected” where the test for public interest standing is met. The parties affected by the CPMA’s decision were Sudbury Downs, the NHA and the racing associations with which Sudbury Downs intends to inter‑track bet. There was no existing contractual relationship between the applicant and Sudbury Downs, and thus no evidence that the applicant or the horsemen it represents were directly affected by the CPMA’s decision. The applicant also did not have public interest standing since it failed the tri‑partite test for recognition thereof. It did not raise a serious issue for trial. There was no connection between the contractual obligations resulting from the applicant’s Pre‑Licence Agreements with racing associations that it sought to have enforced by the Court and the CPMA’s decision. The applicant also did not have a genuine interest in the matter since there was no evidence of harm to it by the CPMA’s approval of Sudbury Downs’ application to inter‑track bet. Rather, the applicant was seeking to exclude those racing associations which do not utilize it as the exclusive representative of the horsemen under contract to it. Finally, there was another “reasonable and effective way” to bring the CPMA’s decision in issue before the Court — i.e. by a party involved in the application for approval, including the NHA, Sudbury Downs or one of the host tracks with which Sudbury Downs has an agreement to inter‑track bet.
statutes and regulations judicially
considered
Federal Courts Act, R.S.C., 1985, c. F‑7, ss. 1 (as am. by S.C. 2002, c. 8, s. 14), 18.1 (as enacted by S.C. 1990, c. 8, s. 5; 2002, c. 8, s. 27).
Criminal Code, R.S.C., 1985, c. C‑46, ss. 201, 202, 204 (as am. by R.S.C., 1985 (1st Supp.), c. 47, s. 1; S.C. 1989, c. 2, s. 1; 1994, c. 38, ss. 14, 25).
Pari‑Mutuel Betting Supervision Regulations, SOR/91‑365, ss. 2 “horseman”, “inter‑track betting” (as am. by SOR/95‑262, s. 1), 85(4)(f) (as am. by SOR/92‑628, s. 2), 90(1) (as am. idem, s. 3; 95‑262, s. 5).
Racing Commission Act, 2000, S.O. 2000, c. 20.
cases judicially considered
applied:
Canadian Council of Churches v. Canada (Minister of Employment and Immigration), [1992] 1 S.C.R. 236; (1992), 88 D.L.R. (4th) 193; 2 Admin. L.R. (2d) 229; 5 C.P.C. (3d) 20; 8 C.R.R. (2d) 145; 16 Imm. L.R. (2d) 161; 132 N.R. 241.
considered:
Dr. Q v. College of Physicians and Surgeons of British Columbia, [2003] 1 S.C.R. 226; (2003), 223 D.L.R. (4th) 599; [2002] 5 W.W.R. 1; 179 B.C.A.C. 170; 11 B.C.L.R. (4th) 1; 48 Admin. L.R. (3d) 1; 302 N.R. 34; 2003 SCC 19; Kwicksutaineuk/Ah‑kwa‑mish Tribes v. Canada (Minister of Fisheries and Oceans) (2003), 227 F.T.R. 96; 2003 FCT 30; Sierra Club of Canada v. Canada (Minister of Finance), [1999] 2 F.C. 211; (1998), 13 Admin. L.R. (3d) 280; 157 F.T.R. 123 (T.D.).
referred to:
Maple Lodge Farms Ltd. v. Government of Canada, [1982] 2 S.C.R. 2; (1982), 137 D.L.R. (3d) 558; 44 N.R. 354; Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231; (1994), 110 D.L.R. (4th) 1; [1994] 3 W.W.R. 609; 41 B.C.A.C. 81; 88 B.C.L.R. (2d) 145; 20 Admin. L.R. (2d) 202; 20 M.P.L.R. (2d) 1; 163 N.R. 81; Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27; (1998), 36 O.R. (3d) 418; 154 D.L.R. (4th) 193; 50 C.B.R. (3d) 163; 33 C.C.E.L. (2d) 173; 221 N.R. 241; 106 O.A.C. 1; Alberta Union of Provincial Employees v. Lethbridge Community College, [2004] 1 S.C.R. 727; (2004), 348 A.R. 1; 238 D.L.R. (4th) 385; [2004] 7 W.W.R. 1; 11 Admin. L.R. (4th) 1; 26 Alta. L.R. (4th) 201; 319 N.R. 201; 2004 SCC 28.
authors cited
Driedger, Elmer A. Construction of Statutes, 2nd ed. Toronto: Butterworths, 2000.
APPLICATION for judicial review of the decision of the Executive Director of the Canadian Pari‑Mutuel Agency, approving Sudbury Downs’ application to conduct inter‑track betting between March 26 and December 31, 2003, pursuant to paragraph 90(1)(d) of the Pari‑Mutuel Betting Supervision Regulations. Application dismissed.
appearances:
John B. Laskin for applicant.
Douglas J. Los for respondent Sudbury Downs Holdings, a division of MacRanald Enterprises Incorporated.
Suzanne M. Duncan for respondent Canadian Pari‑Mutuel Agency.
solicitors of record:
Torys LLP, Toronto, for applicant.
Weaver, Simmons LLP, Sudbury, for respondent Sudbury Downs Holdings, a division of MacRanald Enterprises Incorporated.
Deputy Attorney General of Canada for respondent Canadian Pari‑Mutuel Agency.
The following are the reasons for order and order rendered in English by
Heneghan J.:
INTRODUCTION
[1]The Ontario Harness Horse Association (the OHHA) seeks judicial review pursuant to section 18.1 [as enacted by S.C. 1990, c. 8, s. 5; 2002, c. 8, s. 27] of the Federal Courts Act, R.S.C., 1985, c. F‑7 [s. 1 (as am. by S.C. 2002, c. 8, s. 14)], as amended, of the decision of the Executive Director of the Canadian Pari‑Mutuel Agency (the CPMA), made on or about March 26, 2003, and communicated to the OHHA by letter dated April 4, 2003. In its decision, the CPMA approved Sudbury Downs to conduct inter‑track betting with various host tracks in Ontario and in other provinces between March 26 and December 31, 2003, pursuant to paragraph 90(1)(d) [as am. by SOR/92-628, s. 3; 95-262, s. 5] of the Pari‑Mutuel Betting Supervision Regulations, SOR/91‑365 (the Regulations) enacted under subsection 204(8) [as am. by R.S.C., 1985 (1st Supp.), c. 47, s. 1; S.C. 1989, c. 2, s. 1; 1994, c. 38, s. 25] of the Criminal Code of Canada, R.S.C., 1985, c. C‑46, as amended (the Criminal Code).
BACKGROUND
(i) The Parties
[2]The OHHA is a voluntary association representing approximately 5000 horsemen in Ontario, including owners, trainers, drivers and grooms, who are members of the standard‑bred racing industry. The OHHA was created in 1961 and is licensed by the Ontario Racing Commission, the agency in Ontario that is responsible for management and direction of the horse racing industry, including the general licensing of the racetrack operations, pursuant to the Racing Commission Act, 2000, S.O. 2000, c. 20.
[3]The management of horse racing is a matter of provincial jurisdiction, but the conduct of betting and wagering falls within federal jurisdiction. Pari‑mutuel betting is a form of betting in which individuals who wager on winning horses share in the total amount bet by the public, less a percentage paid to the racetrack operators. “Inter‑track betting” [as am. by SOR/95-262, s. 1] is defined in section 2 of the Regulations as follows:
2. . . .
“inter‑track betting” means pari‑mutuel betting at one or more satellite tracks or in one or more places in one or more foreign countries on a race that is held at a host track, where the money bet on each pool at each satellite track or place is combined with the money bet on the corresponding pool at the host track to form one pool from which the pay‑out price is calculated and distributed.
[4]The OHHA negotiates agreements with racing associations concerning, among other things, the distribution of revenue from inter‑track betting.
[5]Sudbury Downs Holdings is a division of MacRanald Enterprises Incorporated. It owns and operates Sudbury Downs racetrack in the city of Greater Sudbury, in northern Ontario. It has existed as a harness horse racing track since 1974 and may be described as a racing “association” for the purposes of subsection 204(11) [as am. by R.S.C., 1985 (1st Supp.), c. 47, s. 1] of the Criminal Code. That term is to be distinguished from the entities known as “horsemen’s associations” which are, essentially, trade associations in which membership is voluntary.
[6]The CPMA is a special operating agency, authorized by section 204 of the Criminal Code. It functions as a national regulatory unit. It is responsible for the administration of pari‑mutuel betting on horses in Canada in accordance with the Regulations. Mr. Thane Bell, Associate Executive Director of the CPMA, provided an affidavit in this application for judicial review in which he described the purpose of the Regulations in the following terms:
The scope of the Regulations is the supervision and operation of pari‑mutuel betting at racetracks and the prohibition, restriction and regulation of the possession of drugs and equipment used in the administering of drugs at racetracks. The purpose of the Regulations is to provide effective and efficient pari‑mutuel betting supervision in order to protect the betting public against fraudulent practices, thereby helping to maintain a viable racing industry.
[7]The CPMA exercises no regulatory authority over horse racing; that is a matter within provincial jurisdiction. The role of the CPMA is directed to wagering and involves racing to the extent necessary to ensure fairness in its decision making.
[8]Wagering is prohibited by sections 201 and 202 of the Criminal Code. However, an exemption is provided by subparagraph 204(1)(c)(ii) for bets made through a pari‑mutuel system if there is compliance with the Regulations. Paragraph 204(8)(e) authorizes the Minister of Agriculture and Agri‑Food to regulate pari‑mutuel systems of betting.
[9]The Regulations require racetrack owners, such as Sudbury Downs, to apply for permits, authorizations and approvals (the Licences) to conduct various kinds of betting. Paragraph 90(1)(d) of the Regulations provides as follows:
90.(1) Subject to subsection (1.1), an association that proposes to conduct inter‑track betting or separate pool betting at its race‑course, whether as a host track or a satellite track, shall
. . .
(d) at the time the application for authorization to conduct inter‑track or separate pool betting under paragraph (b) is made, have executed an agreement with the horsemen under contract to it for the period of the proposed inter‑track or separate pool betting, that governs the scheduling of races for, and the sharing of revenues from, the proposed inter‑track or separate pool betting and provide evidence of the agreement.
[10]A racetrack, such as Sudbury Downs, must provide evidence of an executed agreement with the horsemen under contract to it for the period of the proposed licences when applying for a licence to conduct inter‑track betting. According to the affidavit of Mr. Bell, filed on behalf of the CPMA, the agreements must only show that the horsemen and the racetrack have agreed about the scheduling of races (the Schedule) for, and the sharing of revenues (the Split) from, the proposed inter‑track betting. These agreements will be described as the “Pre‑Licence Agreements”.
[11]In practice, in Ontario, the Ontario Racing Commission establishes the Schedule. However, since the Regulations came into effect in 1991, the horsemen’s associations have negotiated and executed the Pre‑Licence Agreements on behalf of the horsemen. The designation “horsemen under contract” to a racing association is not defined, but “horseman” is defined in section 2 of the Regulations as follows:
2. . . .
“horseman” means any person, group or organization that has an interest in the sharing of purses drawn from an association’s percentage and the scheduling of races by the association, but does not include an officer or employee of an association.
[12]The practice of the CPMA was to issue licences for a calendar year and, for that reason, the Pre‑Licence Agreements were usually negotiated and signed in the late fall. For approximately 24 years before 1998, the OHHA entered into a series of Pre‑Licence Agreements with Sudbury Downs, addressing the terms and conditions under which racing would occur at Sudbury Downs and how revenue would be divided. However, in 1998, the OHHA and Sudbury Downs were unable to reach an agreement and a number of local horsemen in northern Ontario formed the Northern Horsemen’s Association (the NHA).
[13]On July 24, 1998, the NHA concluded Pre‑ Licence Agreements with Sudbury Downs, incorpora-ting the Schedule and the Split, and continued to do so in the following years. The CPMA has recognized, and continues to recognize the Pre‑Licence Agreements between Sudbury Downs and the NHA as complying with the regulatory criteria because these Pre‑Licence Agreements were executed by the horsemen and address the Schedule and the Split, as required by paragraph 90(1)(d) of the Regulations.
[14]The OHHA negotiated Pre‑Licence Agreements concerning the Schedule and the Split from proposed inter‑track betting with several Ontario racing associations for the period January 1, 2003 to December 31, 2003. These racing associations include: Clinton Raceway Inc., Flamboro Downs Holdings Limited, Georgian Downs Limited, Hanover Raceway, Hiawatha Horse Park Inc., Kawartha Downs Limited, Kawartha Downs Raceway, Quinte Exhibition & Raceway (Belleville Raceway), Rideau Carleton Raceway Holdings Limited, Western Fair Association, Windsor Raceway Inc., Winrac Development Inc. (Dresden), Winrac Development Inc. (Woodstock), Woodbine Entertainment Group, and Woolwich Agricultural Society.
[15]A condition of the Pre‑Licence Agreements, with the exception of the agreement with Woodbine Entertainment Group, was that the named racing associations would not participate in any form of inter‑track betting without the approval of the OHHA. The agreement with Woodbine Entertainment Group contains a specific provision concerning inter‑track betting at Sudbury Downs.
[16]The OHHA has not approved inter‑track betting of the racetracks otherwise listed above and Sudbury Downs.
[17]On or about November 11, 2002, Sudbury Downs applied to the CPMA for approval to conduct inter‑track betting for the year 2003. On December 3, 2002, the CPMA advised Sudbury Downs that its application could not be approved until it provided evidence of an agreement with its horsemen in accordance with paragraphs 85(4)(f) [as am. by SOR/92-628, s. 2] and 90(1)(d) of the Regulations.
[18]On or about March 25, 2003, Sudbury Downs provided the CPMA with evidence of the Pre‑Licence Agreement it had negotiated with the NHA on or about March 25, 2003. This Pre‑Licence Agreement contained clauses addressing the Schedule and the Split. The CPMA also received copies of the agreements between Sudbury Downs and the host tracks with which it intended to inter‑track bet.
[19]By letter dated March 26, 2003, the OHHA advised the CPMA that, pursuant to its Pre‑Licence Agreements, it had not approved of inter‑track betting at Sudbury Downs and consequently, the agreements between the OHHA and the racing associations were not operating. The OHHA also informed the CPMA that the requirements for inter‑track betting under the Regula-tions had not been satisfied because the horsemen under contract at each of the racing associations had not agreed to the Schedule and Split for inter‑track betting with Sudbury Downs for 2003.
[20]On or about March 26, 2003, the CPMA approved Sudbury Downs to conduct inter‑track betting, separate pool betting, foreign race separate pool betting and foreign race inter‑track betting with various host tracks throughout Ontario and elsewhere, from March 26, 2003 to December 31, 2003. The host tracks with which Sudbury Downs sought to inter‑track bet had all received the same approvals to inter‑track bet by the CPMA. Following the issuance of approval by the CPMA, Sudbury Downs entered into Common Pool Wagering Agreements with the host tracks, who agreed to transmit the audio‑visual signal of selected races to Sudbury Downs via satellite to allow the conduct of pari‑mutuel wagering on those races. By letter dated April 4, 2003, the CPMA informed the OHHA of its decision to approve inter‑track betting at Sudbury Downs.
ISSUES
[21]Four issues arise from this application for judicial review. First, does the OHHA have standing to bring this application. Second, what is the applicable standard of review for decisions of the CPMA. Third, does paragraph 90(1)(d) of the Regulations require that before approval is given for inter‑track betting, that both the host track and the satellite track have entered into Pre‑Licence Agreements with the horsemen under contract to them, concerning the Schedule and the Split from the proposed inter‑track betting. Finally, did the CPMA err in granting approval to Sudbury Downs to conduct inter‑track betting pursuant to paragraph 90(1)(d) of the Regulations.
DISCUSSION AND DISPOSITION
(i) Standard of Review
[22]The applicant argues that the applicable standard of review is correctness, relying on the factors identified by the Supreme Court of Canada in Dr. Q v. College of Physicians and Surgeons of British Columbia, [2003] 1 S.C.R. 226. The factors to be considered, in a pragmatic and functional manner, are the matters of the appeal or review mechanism and the existence of a privative clause; the relative expertise of the tribunal; the purpose of the statute or regulation; and finally, the nature of the question.
[23]The applicant characterizes the question here as primarily a question of law, that is the interpretation of the Regulations and, accordingly, submits that less deference should be accorded to the CPMA on the grounds of relative expertise and the nature of the question involved. The weight of these factors tend to favour applying the least deferential standard, that of correctness.
[24]For its part, the CPMA submits that the appropriate standard of review is that applicable to simple discretionary decisions, that is the standard set out in Maple Lodge Farms Ltd. v. Government of Canada, [1982] 2 S.C.R. 2. It argues that the decision to issue the approval met all the requirements of the Regulations and consequently, the discretion was properly exercised for a legitimate purpose and without regard to extraneous considerations.
[25]Alternatively, the CPMA argues that upon applying the pragmatic and functional analysis outlined in Dr. Q, an intermediate standard of reasonableness simpliciter should apply, rather than the standard of correctness.
[26]Sudbury Downs agrees with the CPMA that the decision in issue is a fairly discretionary one under the Regulations. As such, it is reviewable on limited grounds, as set out in Maple Lodge Farms Ltd., and in Shell Canada Products Ltd. v. Vancouver (City), [1994] 1 S.C.R. 231.
[27]In my opinion, the applicable standard of review depends upon the issue being addressed. I am satisfied that there are two distinct aspects of the decision here in issue: the first being whether or not the CPMA properly interpreted the requirements of paragraph 90(1)(d) of the Regulations and the second, assuming that the interpretation was correct, whether the decision under review is sustainable.
[28]In relation to the first question, that is whether or not the CPMA properly interpreted the requirements of the Regulations, is a question of statutory interpretation and accordingly, a question of law. On that issue, the applicable standard of review is correctness. Applying the pragmatic and functional approach and the four contextual factors upon which it is based, that is the presence or absence of a privative clause or statutory right of appeal, the expertise of the tribunal relative to that of the reviewing Court, the purpose of the legislation generally and the particular provision at issue, and finally, the nature of the question, I reach the following conclusions.
[29]First, there is no privative clause or statutory right of appeal provided by the Regulations. Second, the Executive Director, as representative of the Minister, cannot be said to have greater expertise in questions of statutory interpretation than does the Court. On the other hand, his expertise on pari‑mutuel policy and adminis-tration, management and control attracts substantial deference. Thirdly, the purpose of the Regulations and the provision in question confers upon the Executive Director limited authority to regulate pari‑mutuel systems of betting on horse races, limited to ensuring fairness and protecting the betting public against fraudulent practices. That being so, the authority conferred upon the Executive Director does not extend, per se, to the interpretation, as a matter of law, of the Minister’s statutory mandate. Finally, the nature of the question is a legal one. Accordingly, I conclude that the question must be reviewed on a standard of correctness.
[30]In so far as the review of the decision of the CPMA is concerned, I reach a different conclusion. I am not satisfied that this decision is in the nature of a discretionary decision, as argued by the respondents. Rather, it appears to be a question of mixed fact and law, that is, the application of the statutory requirements to Sudbury Downs’ application for inter‑track betting. In my opinion, the standard of review analysis requires more deference here.
[31]The CPMA’s expertise is based in regulatory matters, particularly with respect to administering pari‑mutuel betting on horses in accordance with the Regulations. As well, the application of paragraph 90(1)(d) of the Regulations to the facts presented in the application of Sudbury Downs, for inter‑track betting, involves questions of mixed fact and law. These two factors favour a more deferential standard. In respect of this issue, that is the standard of reasonableness simpliciter.
(ii) Interpretation of Paragraph 90(1)(d) of the Regulations
[32]The parties agree that the modern approach to statutory interpretation is that proposed by Driedger, where “the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament”: Elmer A. Driedger, Construction of Statutes, 2nd. ed. (Toronto: Butterworths, 1983), at page 87. This approach has been widely endorsed by the Supreme Court of Canada as the preferred approach to statutory interpretation: see Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27 and Alberta Union of Provincial Employees v. Lethbridge Community College, [2004] 1 S.C.R. 727.
[33]In interpreting legislation, the Court must consider several questions. It must first look at the words; do the words have a plain and ordinary meaning, or is there ambiguity or lack of clarity. Second, the context of the legislation must be examined, including the history of the provision in question, the scheme of the statute and its object. Attention must also be given to the policy considerations of Parliament or, in the case of regulations, the Governor in Council.
[34]Paragraph 90(1)(d) of the Regulations provides as follows:
90. (1) Subject to subsection (1.1), an association that proposes to conduct inter‑track betting or separate pool betting at its race‑course, whether as a host track or a satellite track, shall
. . .
(d) at the time the application for authorization to conduct inter‑track or separate pool betting under paragraph (b) is made, have executed an agreement with the horsemen under contract to it for the period of the proposed inter‑track or separate pool betting, that governs the scheduling of races for, and the sharing of revenues from, the proposed inter‑track or separate pool betting and provide evidence of the agreement.
[35]Applying the relevant principles of statutory interpretation to this provision, I am of the view that what is required, in applying for approval for inter‑track betting, is an executed Pre‑Licence Agreement with the horsemen under contract to the racing association making the application, which agreement includes details of the Schedule and the Split. This requirement appears to be the same, whether the racing association is applying as a host track or a satellite track.
[36]Paragraph 90(1)(c) [as am. by SOR/95-262, s. 5] further requires:
90. (1) . . .
(c) provide evidence of an agreement between the association and another association for the conduct of inter‑track betting or separate pool betting, as the case may be, between the race‑courses of the two associations, whether as a host track or a satellite track, and include
(i) the dates and races that are involved,
(ii) the types of bets that are proposed to be offered,
(iii) the legal percentages to be deducted from each pool that each association proposes to offer, and
(iv) the method of calculation that the associations propose to use for each pool that is combined;
[37]This paragraph requires that the racing associations, that is the host track and the satellite track have an agreement with each other to conduct inter‑track betting. There is nothing in the wording of paragraph 90(1)(c) requiring that there be an agreement between the horsemen of one racing association and the racing association with which it intends to inter‑track bet, i.e., no requirement that the horsemen under contract to the host track have an agreement or consent to inter‑track betting with a proposed satellite track. The agreement is between the associations, not individual members of the associations.
[38]With respect to the purpose of the Regulations, subsection 204(9) [as am. by R.S.C., 1985 (1st Supp.), c. 47, s. 1; S.C. 1994, c. 38, s. 25] of the Criminal Code provides as follows:
204. . . .
(9) The Minister of Agriculture and Agri‑Food may make regulations respecting
(a) the supervision and operation of pari‑mutuel systems related to race meetings, and the fixing of the dates on which and the places at which an association may conduct those meetings;
(b) the method of calculating the amount payable in respect of each dollar bet;
(c) the conduct of race‑meetings in relation to the supervision and operation of pari‑mutuel systems, including photo‑finishes, video patrol and the testing of bodily substances taken from horses entered in a race at such meetings, including, in the case of a horse that dies while engaged in racing or immediately before or after the race, the testing of any tissue taken from its body;
(d) the prohibition, restriction or regulation of
(i) the possession of drugs or medicaments or of equipment used in the administering of drugs or medicaments at or near race‑courses, or
(ii) the administering of drugs or medicaments to horses participating in races run at a race meeting during which a pari‑mutuel system of betting is used; and
(e) the provision, equipment and maintenance of accommodation, services or other facilities for the proper supervision and operation of pari‑mutuel systems related to race meetings, by associations conducting those meetings or by other associations.
[39]The language of the enabling statute, that is subsections 204(8) and (9) of the Criminal Code, confirms the intention of Parliament that the Regulations provide effective and efficient pari‑mutuel betting supervision in order to protect the betting public against fraudulent practices, thereby helping to maintain a viable racing industry.
[40]The Regulatory Impact Analysis Statement (the RIAS) relating to amendments of paragraph 90(1)(d) of the Regulations undertaken in 1992 is Exhibit “B” to the affidavit of John Walzak, sworn on behalf of the applicant. The RIAS describes the amended Regulations as follows:
The provisions of these requirements pertain to the execution of agreements between race track associations and the horsemen under contract to them when the associations apply for a betting permit.
This amendment [a 1989 amendment to the Criminal Code permitting teletheatre betting] stated that every race track association was required to provide proof that it executed an agreement with the horsemen under contract to it before the proposed theatre, inter‑track or separate pool betting could be approved by the Race Track Division. The agreement covered the scheduling of races and the sharing of revenues from the theatre, inter‑track or separate pool betting.
(iii) Did the CPMA Err in Granting Approval to Sudbury Downs
[41]In light of my conclusion that the CPMA properly interpreted the statutory requirements of paragraph 90(1)(d) of the Regulations, the next question is whether it erred in granting approval to Sudbury Downs.
[42]The evidence contained in the certified record indicates that Sudbury Downs provided a copy of an executed Pre‑Licence Agreement with the NHA, dated March 25, 2003, which contained clauses setting out agreements for the Schedule and the Split. As well, Sudbury Downs submitted copies of the agreements between it and the host tracks with which it intended to inter‑track bet. The applicant’s evidence was that the OHHA had negotiated Pre‑Licence Agreements concerning the Schedule and the Split from proposed inter‑track betting with a number of Ontario racing associations for the 2003 racing season.
[43]However, it was submitted by the applicant that the CPMA erred by failing to give consideration to certain evidence which it considers relevant, namely the fact that the Pre‑Licence Agreements negotiated between the OHHA and the host tracks contained provisions which suggested that the OHHA had to approve inter‑track betting before a host track could participate. However, even if this evidence was not considered, that does not make the ultimate decision unreasonable.
[44]The question of satisfaction of a condition precedent to a Pre‑Licence Agreement is a private issue for the OHHA to resolve with each of the racing associations with which it had a contract. That is a contractual dispute beyond the scope of judicial review and, consequently, is not an issue for the CPMA or for the public.
[45]In my opinion, the CPMA’s approval of Sudbury Downs’ application to conduct inter‑track betting is essentially a preliminary permit. The obvious condition which must be fulfilled is that an agreement be reached between the satellite track, in this case Sudbury Downs, and the host tracks with which it wishes to conduct inter‑track betting. That is a matter which the tracks must resolve themselves. It is beyond the scope of the CPMA to inquire whether a particular host track is breaching its contractual obligations to its horsemen in negotiating an agreement with a satellite track, for inter‑track betting. I note that Sudbury Downs had negotiated agreements with a number of other host tracks, other than those affiliated with the OHHA. To deny Sudbury Downs a permit based upon a contractual dispute to which it is not a party would deny it the ability to conduct inter‑track betting with a number of other host tracks who are not involved in the present dispute.
[46]As noted above, I have concluded that the applicable standard of review to the decision of the CPMA is reasonableness simpliciter, since the decision involves consideration by that body of a question of mixed fact and law. Applying that standard, I am not persuaded that the decision of the CPMA to approve Sudbury Downs for the conduct of inter‑track betting is unreasonable.
(iv) Question of Standing
[47]Finally, the issue of standing remains to be addressed. Does the applicant have standing to challenge this decision of the CPMA.
[48]There are two avenues by which an applicant can establish standing in its judicial review application. Subsection 18.1(1) of the Federal Courts Act addresses standing as follows:
18.1 (1) An application for judicial review may be made by the Attorney General of Canada or by anyone directly affected by the matter in respect of which relief is sought.
[49]This provision is broad enough to authorize the recognition of standing even if the applicant is not “directly affected” where the test for public interest standing is met: see Kwicksutaineuk/Ah‑kwa‑mish Tribes v. Canada (Minister of Fisheries and Oceans) (2003), 227 F.T.R. 96 (F.C.T.D.).
[50]Since the applicant in this proceeding is not the Attorney General of Canada, the question is whether it is “anyone directly affected” by the CPMA’s approval of inter‑track betting at Sudbury Downs. If not, can it show that it has public interest standing.
[51]Although the applicant states in its notice of application that it represents its members in negotiations of purses, racing conditions and all matters affecting the horse racing industry as a whole, that is with the tracks, Standardbred Canada, the Ontario Racing Commission, and the provincial and federal governments and their agencies, it is not the sole and exclusive representative of horsemen. It has no vested rights to represent all horsemen in Ontario, without regard to the applicable regulatory requirements.
[52]The decision which is the subject-matter of this application for judicial review involved an application by the respondent Sudbury Downs for approval to conduct inter‑track betting in accordance with paragraph 90(1)(d) of the Regulations. The horsemen under contract to Sudbury Downs, as evidenced by the Pre‑Licence Agreement submitted to the CPMA, were those horsemen represented exclusively by the NHA, not the applicant. Accordingly, the parties affected by the CPMA’s decision would include Sudbury Downs, the NHA and the racing associations with which Sudbury Downs intends to inter‑track bet.
[53]Consequently, there is no evidence that the applicant has an existing contractual relationship with Sudbury Downs. In my opinion, the applicant is only affected indirectly by the CPMA’s decision which merely creates a situation that may, eventually, affect the applicant. At best, the applicant has a potential interest in relation to the inter‑track betting which will occur as a result of the CPMA’s approval of Sudbury Downs to inter‑track bet with host tracks, some of which have negotiated Pre‑License Agreements with the applicant.
[54]That being said, I am satisfied that no evidence has been submitted by the applicant to show that it, or the horsemen it represents, are directly affected by the decision to issue the license to Sudbury Downs for inter‑track betting. The analysis must then address whether the applicant has shown that it has public interest standing to bring this application.
[55]The Supreme Court of Canada, in Canadian Council of Churches v. Canada (Minister of Employment and Immigration), [1992] 1 S.C.R. 236 set out a tri‑partite test for the recognition of public interest standing. That test provides that an applicant must establish that there is a serious issue raised, the applicant has a genuine interest in the matter and that there is no other reasonable and effective way to bring the matter before the Court.
[56]While a public interest applicant need not establish that the alleged illegality of an administrative decision or act has caused or will cause harm in order to show the seriousness of the issue raised, as noted by the Court in Kwicksutaineuk, the Court must consider the overall strength of an applicant’s claim in assessing whether a serious issue is raised. In Sierra Club of Canada v. Canada (Minister of Finance), [1999] 2 F.C. 211 (T.D.), the Court spoke about the existence of a serious issue in the following terms at paragraph 38:
It seems now to be settled law that the seriousness of the issues raised by a public interest applicant encompasses both the importance of the issues and the likelihood of their being resolved in favour of the applicant. Given the discretionary nature of public interest standing, and its concern to ensure that scarce public resources are not squandered and other litigants are not subjected to further delay, it seems appropriate that the merits of the claim should be taken into consideration. [Citations omitted.]
[57]I am not satisfied that there is a serious issue for trial in the present application. As noted above, it appears that, in effect, the applicant is seeking to have this Court enforce contractual obligations between itself and the racing associations with which it had negotiated Pre‑Licence Agreements. The applicant argues that those agreements contained a condition precedent, namely that before conducting inter‑track betting with a satellite track, the host track must first obtain its consent. However, I do not see the connection between this condition precedent and the approval granted by the CPMA to Sudbury Downs to conduct inter‑track betting.
[58]It is my opinion that the approval by the CPMA, at this stage is merely an authorization to conduct inter‑track betting. A condition of that approval is that a monthly schedule be provided to the CPMA. As well, a copy of inter‑track agreements must be on file with the host track prior to the betting commencing. It seems to me that the applicant is really contesting the inter‑track agreements between Sudbury Downs and the various host tracks with which it has negotiated a Pre‑License Agreement. That matter is beyond the scope of the CPMA’s regulatory mandate.
[59]The second question, whether the applicant has a genuine interest in the matter, is likewise not satisfied. There does not appear to be any question that the applicant is affected by the approval of Sudbury Downs to inter‑track bet, in the sense that some of the host tracks with which it has an agreement will be offering inter‑track betting to Sudbury Downs. That being said however, it can be argued, and I am satisfied that this is the case, the effect on the applicant is indirect rather than direct.
[60]The applicant appears to be operating an agenda of its own, in seeking to exclude those racing associations which do not utilize it as the exclusive representative of the horsemen under contract to it. There is no evidence of harm to the applicant by the CPMA’s approval of Sudbury Downs to inter‑track bet. Indeed, it has been suggested by the CPMA that, at least in the short term, inter‑track betting would increase revenues at Sudbury Downs for the track and the horsemen, as well as at the host track and for the horsemen at those tracks. That point was conceded by the applicant’s affiant, Mr. Walzak, in cross‑ examination, as follows:
Q. I refer you to paragraph 12 on page 3 of your second affidavit. Are you saying there that you agree that in the short term, at least, inter‑track betting would increase revenues at Sudbury Downs for the track and the horsepeople at the track and the horsepeople at the host tracks?
A. It—it may.
[61]Finally, I am satisfied that there is another “reasonable and effective way” to bring the CPMA’s decision that is here in issue, before the Court, that is by a party involved in the application for approval, including the NHA, Sudbury Downs or one of the host tracks with which Sudbury Downs has an agreement to inter‑track bet. As well, it would be appropriate for a horseman who is not represented by the NHA, but who has an interest in the Split and Schedule at Sudbury Downs, to challenge the decision of the CPMA which is the subject of this application. The applicant did not submit any evidence that it was representing such a horseman.
[62]In the result, I conclude that the applicant lacks standing to bring this application for judicial review. However, in any event, as noted above, I have found that there is no basis for judicial intervention in the decision made by the CPMA in this case.
[63]The application for judicial review is dismissed with costs.
ORDER
This application for judicial review is dismissed with costs.