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A-560-76
McCulloch of Canada Limited and McCulloch Corporation (Applicants)
v.
Anti-dumping Tribunal (Respondent)
Court of Appeal, Jackett C.J., Pratte and Le Dain JJ.—Ottawa, June 7, 8 and 9, 1977.
Judicial review — Application to set aside decision of Anti-dumping Tribunal for error in law — General Agreement
on Tariffs and Trade "Major proportion of the total domestic production" Whether "major" to be interpreted as
meaning more than one-half or as significant Applicants importing only power unit of chainsaw — Whether power unit without a bar and chain a chainsaw in law — Anti-dumping Act, R.S.C. 1970, c. A-15, ss. 16(1),(4) — Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade, Article 4(a).
The applicants apply to the Court to set aside a decision of the Anti-dumping Tribunal on the ground of an error in law. The Tribunal is required to take section 16(4) of the Anti- dumping Act into account in coming to its conclusion. It was argued that "major", in the phrase "a major proportion of the total domestic production of those products", found in Article 4(a) of the Agreement on Implementation off Article VI of the General Agreement on Tariffs and Trade, was to be interpreted as "more than one-half" as opposed to "significant". Further, the applicants submit that as far as present or future injury is concerned, the "Finding" was invalid: the conclusion, in the reasons of the Tribunal, that the object in question without a bar and chain was a chainsaw, was wrong in law.
Held, the application is dismissed. When the various senses that may be attributed to the word "major" are examined, the sense in which it is used in Article 4(a) is "significant" and not the more precise mathematical sense of more than one-half that may be dictated by the context in certain cases. To interpret the word in the mathematical sense would tend to frustrate in part the obvious intent of the statute. Although it was argued that the Tribunal's "Finding" was wrong in law and therefore invalid, it is not necessary to reach any conclusion on the question because the Tribunal's decision was reached by refer ence to facts arising only when complete chainsaws were being imported. Nevertheless, if the Tribunal's conclusion were wrong, it was as a result of an error of fact, not an error of law, and hence outside the jurisdiction of this Court.
APPLICATION for judicial review. COUNSEL:
John D. Richard, Q.C., for applicants.
James L. Shields for respondent.
Robert J. Cowling for Homelite-Terry &
Desa Industries Ltd.
SOLICITORS:
Gowling & Henderson, Ottawa, for appli cants.
Soloway, Wright, Houston, Greenberg, O'Grady & Morin, Ottawa, for respondent. Ogilvy, Cope, Porteous, Montgomery, Renault, Clarke & Kirkpatrick, Montreal, for Homelite-Terry & Desa Industries Ltd.
The following are the reasons for judgment delivered orally in English by
JACKETT C.J.: This is a section 28 application to set aside a "Finding" of the Anti-dumping Tri bunal, which reads as follows:
The Anti-dumping Tribunal, having conducted an inquiry under the provisions of subsection (1) of section 16 of the Anti-dumping Act consequent upon the issue by the Deputy Minister of National Revenue for Customs and Excise of a preliminary determination of dumping dated May 12, 1976, respecting the dumping into Canada of gasoline powered chain saws, having an engine displacement of 2.5 cubic inches or less, manufactured by McCulloch Corporation, Los Angeles, Cali- fornia and Beaird-Poulan, a Division of Emerson Electric Com pany, Shreveport, Louisiana, United States of America, finds that such dumping into Canada has caused material injury to the production in Canada of like goods.
We only found it necessary to call on counsel for the "interested parties"' to answer two submis sions made on behalf of the applicants.
The first of the two submissions was that the Tribunal erred in law in the manner in which it attempted compliance with section 16(4) of the Anti-dumping Act, R.S.C. 1970, c. A-15, which reads:
(4) The Tribunal, in considering any question relating to the production in Canada of any goods or the establishment in Canada of such production, shall take fully into account the provisions of paragraph 4(a) of the Agreement on Implementa tion of Article VI of the General Agreement on Tariffs and Trade signed at Geneva, Switzerland, on June 30, 1967.
when read with Article 4(a) of the Agreement referred to therein, the relevant portion of which reads:
The Tribunal was represented by counsel but only in respect of jurisdictional questions if any arose. Other parties had filed notices of intention to participate and were represented by counsel who opposed the application.
(a) In determining injury the term "domestic industry" shall be interpreted as referring to the domestic producers as a whole of the like products or to those of them whose collective output of the products constitutes a major proportion of the total domestic production of those products ....
when it concluded:
For the purpose of assessing whether material injury is being caused to the production in Canada of the subject saws, the Tribunal has accepted Desa and Homelite as constituting the industry within the meaning of Article 4(a) of the Anti-Dump ing Code, which the Tribunal is required to take into account under the provisions of section 16(4) of the Anti-dumping Act.
This first submission was based on the conten tion that the word "major" in the expression "a major proportion of the total domestic production of those products" required that the "domestic industry" represent more than one-half of the Canadian production.
As I have reached the conclusion that this con tention is incorrect, I do not need to reach any conclusion on the many questions that would arise as to the interaction of subsections (1) 2 and (4) of section 16 if the contention were correct.
2 Section 16(1) reads:
16. (1) The Tribunal, forthwith upon receipt by the Secretary under subsection 14(2) of a notice of a preliminary determination of dumping, shall, in respect of the goods to which the preliminary determination of dumping applies, make inquiry as to whether
(a) the dumping of the goods that are the subject of the inquiry
(i) has caused, is causing or is likely to cause material injury to the production in Canada of like goods,
(ii) has materially retarded or is materially retarding the establishment of the production in Canada of like goods, or
(iii) would have caused material injury to the produc tion in Canada of like goods except for the fact that provisional duty was applied in respect of the goods; or
(b) in the case of any goods to which the preliminary determination of dumping applies,
(i) either
(A) there has occurred a considerable importation of like goods that were dumped, which dumping has caused material injury to the production in Canada of like goods or would have caused material injury to such production except for the application of anti- dumping measures, or
(B) the importer of the goods was or should have been aware that the exporter was practising dumping and that such dumping would cause material injury to the production in Canada of like goods, and
(ii) material injury has been caused to the production in Canada of like goods by reason of the fact that the
My reason for rejecting the contention is that, when one examines the various senses that may be attributed to the word "major", 3 in my view, the sense in which it is used in Article 4(a) is "signifi- cant" and not the more precise mathematical sense of more than one-half that may be dictated by the context, in certain cases, as, for example, where one speaks of the major of two portions of a whole. Reading the Anti-dumping Act in its entirety, the meaning urged by applicants' counsel for the word "major" would, in my view, if it has any effect at all, tend to frustrate in part the obvious intent of the statute.
The second submission upon which we called upon opposing counsel was with reference to the Tribunal's finding in that part of its reasons that reads as follows:
entered goods constitute a massive importation or form part of a series of importations into Canada of dumped goods that in the aggregate are massive and that have occurred within a relatively short period of time, and in order to prevent the recurrence of such material injury, it appears necessary to the Tribunal that duty be assessed on the entered goods.
3 The Concise Oxford Dictionary defines "major" as follows:
major 1. a. Greater (not foll. by than) of two things, classes, etc.; of full age; (in schools) Smith etc.—, the elder of the two Smiths or the first to enter the school;—axis (of conic, passing through its foci); *—league, highest-ranking base ball etc. league (or fig.);—part, majority (of); major PLANET, PROPHET;—Suit, (Bridge) spades or hearts; FRIARS Major. 2. Unusually important or serious or sig nificant (major road, war); (of operation) presenting pos sible danger to patient's life. 3. (Logic). (Of term) occur ring in predicate of conclusion of syllogism; (of premiss) containing major term. 4. (Mus.) (Of interval) normal or perfect (cf. MINOR), as in major scale, (major third); (of key) in which scale has major third; (of scale) with semitones above third and seventh notes. 5. (Mil.) Officer in charge of section of band instruments (DRUM major, PIPE major, TRUMPET-major); SERGEANT-major. 6. n. Person of full age; (Logic) major term or premiss; *stu- dent's special subject or course; *student specializing in a subject (is a philosophy major). 7. v.i. *(Of student) undertake study or qualify in as special subject. [ME f. L, compar. of magnus great]
Another question which was raised was whether the expres sion "chain saws" used in the Deputy Minister's preliminary determination could be interpreted as including the chain saw's power unit only when imported separately. In its public brief McCulloch Canada drew attention to the fact that, beginning April 1, 1976, it had imported only the power unit from McCulloch USA, and had acquired the blade and chain from a Canadian producer. The argument by McCulloch Canada was that since that time it had not imported a "complete" chain saw from McCulloch USA, or from anyone else in the United States, and that the preliminary determination of dumping made by the Deputy Minister "covers complete chain saws only and not parts or components thereof." At the preliminary sitting the Tribunal invited argument as to whether the descrip tion of the goods in the preliminary determination included power units imported separately. The question is, of course, particularly relevant to any consideration of likelihood of ma terial injury.
The Tribunal, in considering this problem, has taken note of the claims in the McCulloch Canada brief that the power unit was one which could be used to power implements other than chain saws, and, specifically, that the power unit was identical to the power unit sold in Canada by McCulloch Canada and by McCulloch USA in the United States as a power unit for an all-purpose drill and a hedge-trimmer. Counsel for McCulloch argued that the preliminary determination applied only to "complete" chain saws. Counsel for Beaird-Poulan also argued that the power head was not a chain saw, although noting that the evidence had not established whether the power head was a multi-purpose power unit.
The Tribunal also notes that, apparently, substantial modifi cations would be required to the power head of chain saws in order to be used with any other tool or implement. For exam ple, the automatic oiling features on the power head are obviously intended for oiling the chain on the guide bar and for no other purpose; the chain brake on the power head is similar ly intended solely for the chain saw; the functioning of the power head in other respects is also designed solely for a chain saw, and would require modification in order to be used for any other purpose. It is also to be noted that the cost of the guide bar and chain generally represents about 10% of the cost of a complete chain saw. Furthermore, one witness for the Canadian industry testified that various applications had been tried for the power unit but without success. His statement was not challenged by McCulloch. The Tribunal also regards as signifi cant the fact that McCulloch failed to submit evidence that it is in fact selling the unit in Canada for other end-uses.
While the imported power unit cannot, of course, be used as a chain saw until a guide bar and chain are attached, the Tribunal finds as a fact, in the circumstances of this case, that gasoline powered chain saws having an engine displacement of 2.5 cubic inches or less, with or without guide bar and chain
when entering Canada, are included in the scope of the prelim inary determination. 4
Having reached this conclusion (and the conclu sion concerning "industry" already referred to), the Tribunal examined the facts for the period beginning with 1972 and ending with the first quarter of 1976 relevant to the question of "injury" and reached the following conclusion with regard thereto:
The rise in market share achieved by the named exporters in 1975 is striking. The increase in volume of the dumped product in the first three months of 1976 over the same period in 1975 approached massive proportions. Discounting, as it does the importance attached by McCulloch, in particular, to alleged superiority or reliability of product and the impact of a new marketing strategy, the Tribunal concludes that it is the dump ing which has led to the depressed state in which the domestic industry now finds itself. Sales, employment, utilization of capacity and profitability have seriously declined. Material injury has been inflicted. Continued dumping of the described chain saws into Canada is also likely to cause material injury in the future, whether or not the guide bar and chain are attached thereto when entering Canada.
As will be seen, upon reading the formal decision or "Finding" quoted at the beginning of these reasons, this conclusion did not affect the wording of the Tribunal's actual decision, which refers to chainsaws and does not refer to objects without bar or chain.
This second submission was, in effect, as I understand it, that, in so far as present or future injury is concerned (but not in so far as past injury is concerned), the "Finding" was invalid because the conclusion in the reasons of the Tribunal that the object in question without a bar and chain is a chainsaw was wrong in law.
I tend to the view that, if such conclusion was wrong, it was as a result of an error of fact and not an error of law, in which event this Court has no jurisdiction to review, it. Compare Brutus v.
° It is, as I understand it, common ground that, once having received the Deputy Minister's preliminary determination, the Tribunal had to proceed under the statute to a decision under section 16 even if there was evidence that importation of the goods described therein had ceased and there was no prospect of future importations.
Cozens. However, I do not find it necessary to reach any conclusion on that question because, as I read the Tribunal's reasons, the conclusion was reached by reference to facts arising when only complete chainsaws were being imported and deductions from those facts. In so far as I can see, the conclusion with reference to chainsaws with bar and chain is in no way dependent on the Tribunal's conclusion that certain objects that did not have bars and chains were chainsaws.
In my view, the section 28 application should be dismissed.
* * *
PRATTE J. concurred.
* * *
LE DAIN J. concurred.
5 [1973] A.C. 854. We did not have an example of the object in question before us and I tend to the view that it would be necessary to have very complete evidence before us before we could conclude that the Tribunal, being a specialized tribunal with background knowledge not available to this Court, could not reasonably have held that the power unit was contained in a casing and had such specialized attachments as to bring it within the relatively new class of machine called "chainsaws".
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