Government 'Policy' Decisions Do Not Always Trump Judicial Review

A change in government and its policies can impact business dramatically, and often with unintended consequences. In some cases, the result is intended. In matters of a commercial nature that do not involve recognized Charter rights, resort to the Charter is unavailable, especially when legislation is involved. Even if the Charter is applicable, as recent events have shown, a government may invoke the s. 33 "notwithstanding clause" to avoid judicial scrutiny of legislation and a court remedy.1

However, the recent decision of Justice Myers of the Ontario Superior Court in Tesla Motors Canada ULC v. Ontario (Ministry of Transportation)2 demonstrates the ability of the courts to provide an expeditious remedy when a "policy" decision is taken within an existing statutory framework, even if it is in furtherance of a new political mandate. At issue in the case was the Ontario government's decision to exclude Tesla and its customers (more specifically, those customers who bought cars before July 11, 2018 and had them delivered by September 10, 2018) from the two-month extension of government subsidies for electric car buyers after it announced the end of the subsidies. The court set aside the decision to exclude only Tesla car buyers as arbitrary, unfair, and unrelated to the purposes of the statutory discretion being exercised by the Minister of Transportation.

The legal authority for government funding of the subsidies is provided to the Minister of Transportation in s. 118(2) of the Public Transportation and Highway Improvement Act "upon such conditions as he or she considers advisable". For many years, the province provided subsidies to buyers of vehicles which the government listed as environmentally approved and eligible for the subsidies. Most recently, the applicable programs were funded through "cap-and-trade" tax revenues received as a result of regulations under the 2016 Climate Change Mitigation and Low-Carbon Economy Act.

On July 3, 2018, the newly elected Ontario government announced that it had revoked the cap-and-trade system and would begin the orderly wind-down of programs funded through cap-and-trade tax revenues. On July 11, 2018, the government announced that it was ending the programs to fund electric cars. However, the announcement included a two-month extension for cars for which orders had already been placed by dealerships with manufacturers on or before July 11 and that were going to be delivered to customers by...