Federal Court Decisions

 

 

 

Date: 20070411

Docket: T-1349-05

Citation: 2007 FC 347

BETWEEN:

131 QUEEN STREET LIMITED

Applicant

and

 

ATTORNEY GENERAL OF CANADA

Respondent

 

PUBLIC REASONS FOR ORDER

(Confidential Reasons for Order issued April 2, 2007)

 

Heneghan, J.

 

 

I.  Introduction

 

[1]               131 Queen Street Limited (the “Applicant”) seeks judicial review pursuant to section 44 of the Access to Information Act, R.S.C. 1985, c. A-1 (the “Act”) regarding a decision of the Department of Public Works and Government Services Canada (“PWGSC”). In that decision, made on July 12, 2005, PWGSC decided to disclose certain information concerning the business affairs of the Applicant, in response to a request made under the Act. The Applicant claims that the information in question is confidential information belonging to a third party and is exempt from disclosure pursuant to paragraphs 20(1)(a), (b) and (c) of the Act.

[2]               The Applicant seeks an order pursuant to section 51 of the Act that the Minister be prohibited from disclosing the information in question.

 

II.  Facts

 

[3]               The Applicant filed confidential affidavits of Mr. Paul Snyder and Mr. Glen Simpson. The Respondent filed confidential affidavits of Mr. Denis Vaillancourt and of Ms. Pamela Dawson.

 

[4]               According to Mr. Snyder’s affidavit, the Applicant is a body corporate incorporated specifically to develop, lease and manage certain premises located at 131 Queen Street, Ottawa. Morguard Corporation (“Morguard”) is also involved with the lease of the property situate at 131 Queen Street.

 

[5]               On July 21, 2003, the Applicant and Morguard leased the premises to the National Capital Commission (“NCC”). This document in the Head Lease is referred to as the Sub-Lease. On the same day, the NCC subleased the premises to PWGSC.

 

[6]               On April 12, 2005, PWGSC received an access to information request pursuant to the Act, regarding the premises. The requesting party sought release of information relating to the term of the Sub-Lease, the rental rate for the term of the Sub-Lease, the parking costs and number of

parking stalls provided, and any allowances that may have been granted to PWGSC as part of the transaction.

[7]               PWGSC identified the Applicant as a potentially affected third party and by letter dated May 11, 2005, informed the Applicant of the request for information. In that letter, the Respondent also advised the Applicant as to the identity of the specific records that contained the requested information and invited the Applicant to provide its comments, as a third party pursuant to section 27 of the Act, as to why the requested information should not be disclosed.

 

[8]               The Applicant wrote to PWGSC, objecting to the release of the requested information. The Applicant objected to disclosure of the following information:

 

The term and renewal of the Sub-Lease, being article 2 of the Sub-Lease;

 

The assignment of the option to purchase, being article 18 of the Sub-Lease;

 

Specific conditions of the tenants, being article 1 of schedule E of the Head Lease;

 

Construction delays, being article 7 of schedule E of the Head Lease;

 

Option to extend, being article 8 of schedule E of the Head Lease;

 

Option to purchase, being article 10 of schedule E of the Head Lease;

 

Parking, being article 11 of schedule E of the Head Lease;

 

Dispute resolution, including the definition of fair market net effective rent, being article 1 of the Head Lease and Article 15 of schedule E of the Head Lease; and

 

Set-off, being article 18 of schedule E of the Head Lease.

 

 

[9]               By letter dated July 12, 2005, the Respondent notified the Applicant of its decision that only partial exemptions were justified.

 

III.  Summary of Submissions

A.  The Applicant

 

[10]           The Applicant submits that the decision should be reviewed upon the standard of correctness. It further argues that the information is exempt from disclosure because it is confidential information within the scope of paragraph 20(1)(b) of the Act. In this regard it relies on the decision in Air Atonabee  v. Canada (Minister of Transport) (1989), 27 C.P.R. (3d) 180 (F.C.T.D.).

 

[11]           The Applicant also argues that the disclosure of the information gives rise to a reasonable expectation of probable harm, that is a reasonable expectation of financial loss and prejudice to its competitive position in the marketplace. Accordingly, it argues that it is entitled to exemption from disclosure on the basis of paragraph 20(1)(c) of the Act and relies on the decision in Canada Packers Inc. v. Canada (Minister of Agriculture), [1989] 1 F.C. 47 (C.A.).

 

[12]           Finally, the Applicant submits that the disclosure of the requested information will interfere with continuing negotiations and damage relationships with existing tenants. In that respect, it argues that disclosure of the information will undermine current negotiations regarding the premises at 131 Queen because potential tenants will become aware of concessions and inducements made to the NCC. It submits that disclosure will undermine negotiations by Morguard, its business partner, regarding the development of another mixed use office tower in downtown Ottawa. Further, it argues that disclosure will damage relationships with existing tenants to the extent that these tenants may perceive their lease terms are less favourable than those negotiated with the NCC; this may lead to demands by existing tenants for further concessions in renegotiation of their leases concerning such matters as renewal of the lease, option to purchase and dispute resolution.

 

[13]           The Applicant argues that these circumstances justify exemption from disclosure, on the basis of paragraph 20(1)(d) of the Act. It relies on the decisions in Canadian Pacific Hotels Corporation v. Canada ( Attorney General) (2004),  249 F.T.R. 151 and Perez Bramelea Limited v. National Capital Commission, [1995] F.C.J. No. 63, (T.D.) (QL) and argues that these circumstances justify non-disclosure of the information, even on a temporary basis.

 

B.  The Respondent

 

[14]           For its part, the Respondent submits that applications made pursuant to section 44 of the Act are generally treated as judicial reviews in this Court, but this Court will also undertake a de novo assessment to the extent that it deems such assessment necessary. In this regard, the Respondent relies on the decisions in Canada (Information Commissioner) v. Canada (Commissioner of the Royal Canadian Mounted Police), [2003] 1 S.C.R. 66 and St. Joseph Corporation v. Public Works and Government Services (2002), 218 F.T.R. 41.

 

[15]           The Respondent argues that exemptions under subsection 20(1) of the Act are mandatory and that the only question is whether the information in issue falls within any of the exemptions outlined in that statutory provision. The Respondent submits that, in these circumstances, the applicable standard of review is correctness and relies in this regard on the decision in Canadian and Jewish Congress v. Canada (Minister of Employment and Immigration), [1996] 1 F.C. 268 (T.D.).

 

[16]           In response to the Applicant’s submissions concerning the availability of the exemption provided by paragraph 20(1)(c) of the Act, the Respondent argues that the Applicant must show that it complies with each of the four criterion identified in that provision. In this regard, the Respondent relies on the decision in Hutton v. Canada (Minister of Natural Resources) (1997), 137 F.T.R. 110. It submits that exemption from disclosure is the exception to the general rule, relying on the decision in H.J. Heinz Co. of Canada Limited v. Canada (Attorney General), [2003] 4 F.C. 3 (T.D.).

[17]           While the Respondent acknowledges that the disputed information is financial, commercial, scientific or technical in nature, it submits that the Applicant has failed to establish that the information is confidential information per se, that the information was “supplied in confidence” by a third party to the government and finally, that it was treated consistently as confidential information by the Applicant.

 

[18]           Relying on the decision in Canadian Imperial Bank of Commerce v. Canada (Canadian Human Rights Commission) (2006), 45 Admin. L.R. (4^th) 157, the Respondent argues that in order to determine whether information was supplied in confidence by a third party to the government, it is necessary to consider the following factors:

 

a.       the nature rather than the form of the information;

b.      that conclusions by government officials formed from their own observations do not constitute information supplied by a third party; and

c.       that the exemption applies only to those parts of the record which are clearly and specifically shown to be information supplied from the third party.

 

[19]           The Respondent argues that the requested information does not qualify for exemption under paragraph 20(1)(b) for two reasons. First, the information, by its nature, was generated through the participation of PWGSC and the Applicant. The terms of the Sub-Lease were negotiated by the parties, not simply supplied by the Applicant. Second, the Respondent submits that the Applicant has failed to identify the sections of the requested material that it produced solely as a result of its own efforts.

 

[20]           The Respondent challenges the characterization of the information as confidential information and argues that the requested information is already available on the public record, following the registration of notices of various lease documents at the Land Registry Office in Ottawa, pursuant to provincial legislation. It submits that the language of the registration is such that the Applicant has already agreed to make the documents publicly available and further submits that the registered notices also reveal some of the information that the Applicant claims is confidential, such as the length of term of the Sub-Lease.

 

[21]           The Respondent submits that the Applicant has failed to provide any evidence that confidentiality for the disputed information would protect a public interest or a relationship that is fostered in confidence for the benefit of the public. Although it agrees that government suppliers were granted some protection in the jurisprudence cited by the Applicant, it argues that those cases do not require routine protection of such relationships. It submits that confidentiality in a working relationship between the government and a third party is not automatically synonymous with the public interest, even if it contributes to the working relationship.
 

[22]           Finally, the Respondent argues that the only evidence tendered by the Applicant to show that the requested information was treated confidentially is the confidentiality provision in the Head Lease. This provision says that the lease is subject to the Act. The Respondent submits that such an assertion is insufficient to discharge the onus created in paragraph 20(1)(b), that is the evidentiary onus borne by an applicant seeking non-disclosure. In this regard, the Respondent relies on the decision in Mead-Johnson Nutritionals et al. v. Canada (Attorney General), 2005 FC 235.

 

[23]           Further, with respect to the Applicant’s reliance on paragraph 20(1)(c) of the Act, the Respondent argues that the Applicant has failed to produce persuasive evidence to show, on a balance of probabilities, that disclosure could reasonably be expected to cause financial loss and prejudice to its competitive position. The Respondent submits that the strict evidentiary burden is not met by speculation, mere possibility or bare statements in an affidavit, relying on the decisions in St. John Shipyards Limited v. Canada (Minister of Supply and Services) (1989), 24 F.T.R. 33, aff’d. (1990), 107 N.R. 891 (C.A.) and SNC-Lavalin Inc. v. Canada (Minister of Public Works) (1994), 79 F.T.R. 113.

 

[24]           Finally, with respect to the Applicant’s reliance upon paragraph 20(1)(d), the Respondent argues that again, the Applicant has failed to establish an evidentiary basis to justify non-disclosure of the documents on the basis of this statutory provision. As well, the Respondent argues that paragraph 20(1)(d) does not apply to daily commercial dealings but rather, is intended to respond to those situations not covered by paragraph 20(1)(c).

 

IV.  Discussion and Disposition

 

[25]           This proceeding concerns the Applicant’s request for a review of the decision by PWGSC to release certain information pursuant to the Act. Section 44 provides a third party, such as the Applicant, with the right to a review of a decision to disclose and provides as follows:

 

[26]           The purpose of the Act is to allow disclosure of information held by the Government. This purpose is set out in subsection 2(1) of the Act as follows:

 

 

[27]           Certain types of information are protected from disclosure, as set out in subsection 20(1) as follows:

[28]           This provision is mandatory. Disclosure shall be refused where a third party establishes that it meets the criteria set out in subsection 20(1). The presence of the verb “shall” suggests that no deference will be given to the initial decision of the head of a government institution who decides to disclose records and a review pursuant to section 44 will proceed on a de novo basis, including a detailed review of the documents in question, should this be necessary. In this regard, see Air Atonabee.

[29]           Since the purpose of the Act is to provide access to information under the control of a government institution, a “heavy burden” lies on a third party seeking to prevent disclosure, pursuant to subsection 20(1); see Canada (Information Commissioner) v. Canada (Prime Minister), [1993] 1 F.C. 427 (T.D.) at 441.

[30]           In the present case, the Applicant seeks an order for non-disclosure on the basis of paragraphs 20(1)(b), 20(1)(c) and 20(1)(d). I will address each ground in turn.

A.  Paragraph 20(1)(b)

[31]           This provision exempts from disclosure confidential financial, commercial, scientific or technical information. According to the decision in Air Atonabee, the information in question must satisfy the following criteria in order to be exempt on the basis of paragraph 20(1)(b):

1)         financial, commercial, scientific or technical information as those terms are commonly understood;

 

2)         confidential in its nature, according to an objective standard which takes into account the content of the information, its purposes and the conditions under which it was prepared and communicated;

 

3)         supplied to a government institution by a third party; and

 

4)         treated consistently in a confidential manner by the third party.

 

 

[32]           I agree with the Respondent that the disputed information is not information that was “supplied” to a government institution by a third party. This is one of the four mandatory criteria identified in the jurisprudence as a ground for exemption from disclosure pursuant to paragraph 20(1)(b). In Canadian Imperial Bank of Commerce, Justice Blanchard stated at paragraph 96 that information must clearly and specifically be shown to come from a third party in order to be exempt from disclosure under paragraph 20(1)(b).

[33]           In this case, the disputed information consists of certain provisions in the Head Lease and the Sub-Lease that were agreed upon by the parties as a result of negotiations. It is not information that was merely provided to the government by the Applicant. The comments of Justice McGillis at paragraph 3 of Halifax Development Limited v. Canada (Minister of Public Works and Government Services), [1994] F.C.J. No. 2035 (T.D.) (QL) are applicable here:

... With respect, I do not agree that the rental rates constitute information which was "supplied" to a government institution. The evidence tendered on the motion establishes that the rental rates were negotiated between the applicant and respondent as a term of the leases. In my opinion, a negotiated term of a lease may not properly be characterized as information which was supplied to the government Paragraph 20(1)(b) of the Act is therefore inapplicable to the facts of this ease [sic].

[34]           As well, the fact that the Head Lease and the Sub-Lease have been registered in the Land Registry Office at Ottawa, according to the confidential affidavit of Pamela Dawson, greatly undermines the Applicant’s claim that these documents have always been treated as confidential. Ms. Dawson identifies other documents relative to the business interests of the Applicant in the premises that are registered at the Land Registry Office. The Land Registry is open to the public and the documents are available for production, upon request, within fourteen days of a request being made.

[35]           Because the disputed information does not meet the criteria of having been “supplied” to the government, the Applicant has failed to establish that it is entitled to an order of non-disclosure on the basis of paragraph 20(1)(b). In my opinion, it is not necessary to consider the other criteria outlined in Air Atonabee with respect to an exemption under paragraph 20(1)(b). In H.J. Heinz Co.,

the Court concluded that all four applicable criteria must be satisfied in order to qualify for exemption from disclosure on the basis of this statutory provision.

B.  Paragraph 20(1)(c)

[36]           The Applicant argues that it is entitled to an exemption from disclosure on the basis of paragraph 20(1)(c) of the Act. This provision allows non-disclosure on the grounds that disclosure gives rise to a reasonable expectation of financial loss and prejudice from a third party’s competitive position. According to the decision in SNC Lavalin Inc. v. Canada (Minister for International Co-operation) (2003), 234 F.T.R. 294, in order to qualify for non-disclosure on this ground, an applicant need only show that the disclosure could reasonably be expected to result in material financial loss or gain to the Applicant or where the disclosure could reasonably be expected to prejudice its competitive position.

[37]           Again, the burden lies upon the Applicant to establish, on the balance of probabilities, that the disclosure will cause the harm described in paragraph 20(1)(c) of the Act.

[38]           The Applicant describes the potential harm to its financial or competitive position in the confidential affidavit of Mr. Snyder. However, in my opinion, Mr. Snyder has provided only speculative opinions as to the alleged harm that would flow from disclosure of the requested

material. The observations of the Court in SNC Lavalin (2003) at paragraph 36 apply to this case, and reads as follows:

Turning to paragraph 20(1)(c) of the Act and the criteria thereunder as noted in Air Atonabee, as quoted above, the Applicant’s affiant attests, albeit, often in conditional language, to a reasonable expectation of financial loss and prejudice to the competitive position of the Applicant if the records at issue were disclosed. The conditional language used is critical. It is simply not sufficient for the Applicant to establish that harm might result from disclosure. Speculation, no matter how well informed, does not meet the standard of reasonable expectation of material financial loss or prejudice to the Applicant’s competitive position.

[39]           As well, I agree with the Respondent’s arguments that accepting the Applicant’s submissions with respect to paragraph 20(1)(c) would give rise to a blanket exemption under the Act for all those who are involved in commercial transactions with government institutions. Such an interpretation runs counter to the language and purpose of the Act which allows only limited exemptions from disclosure and is intended to facilitate public access to information held by government institutions. In this regard, I refer to Rubin v. Canada (Minister of Health) (2001), 210 F.T.R. 84 at paragraph 36 where the Court said:

Section 2 of the Act codifies the public right of access and the basic premise that the public should have access to government records, and that exceptions to the right of access should be limited and specific. It has also been established that the burden of demonstrating that access to documents should be denied rests on the party opposing disclosure. In Maislin Industries Ltd., supra, Jerome, J., stated the following:

 

“It should be emphasized however, that since the basic principle of these statutes is to codify the right of public access to Government information two things follow: first, that such public access ought not be frustrated by the courts except upon the clearest grounds so that doubt ought to be resolved in favour of disclosure; second, the burden of persuasion must rest upon the party resisting disclosure whether, as in this case, it is the private corporation or citizen, or in other circumstances, the Government.”

C.  Paragraph 20(1)(d)

[40]           The Applicant argues that disclosure of the requested information will interfere with its ongoing negotiations and accordingly, should be exempt from disclosure on the basis of paragraph 20(1)(d) of the Act. To support this argument, the Applicant again relies on the confidential affidavit of Mr. Snyder.

[41]           I am not satisfied that the Applicant has established its allegations in this regard. The affidavit of Mr. Snyder does not provide sufficient probative evidence to justify an exemption on the basis of paragraph 20(1)(d). Unsupported assertions or speculative evidence that disclosure would give rise to a reasonable expectation of probable harm is not enough. In this regard, see Canadian Broadcasting Corporation v. National Capital Commission (1998), 147 F.T.R. 264 at paragraph 27 and Société Gamma Inc. v. Canada (Department of Secretary of State) (1994), 79 F.T.R. 42 at paragraph 10.

[42]           Rather, there must be evidence to support a reasonable expectation that actual contractual negotiations of the Applicant, other than ordinary daily business operations, will be subject to interference; Canada (Information Commissioner) v. Canada (External Affairs), [1990] 3 F.C. 665 (T.D.) at 682-83. The party resisting disclosure must satisfy a heavy burden of persuasion; see SNC Lavalin (2003) at paragraph 37.

[43]           In this case, I am not satisfied that the Applicant has met this burden. In the affidavit of Mr. Snyder, it proposes that “current negotiations” will be disrupted but it does not provide even cursory details about such negotiations such as, for example what space is available for rental, the parties involved or the expected duration of such negotiations. The evidence tendered is speculative and does not support a claim of reasonable expectation of probable harm.

[44]           The Applicant’s claim that disclosure may negatively affect its “business partner” Morguard is of limited value. Morguard is not a party to this proceeding. The Applicant only makes a vague reference to its involvement in the development of a 26-storey mixed-use office tower located at an unidentified location in Ottawa. The Applicant does not discuss any specific negotiations.

[45]           The decisions in Perez and Canadian Pacific are of limited assistance to the Applicant. In both of those cases, the Court suspended the disclosure of information pursuant to paragraph 20(1)(d) for limited periods.

[46]           Unlike the circumstances in Perez Bramalea and Canadian Pacific, the Applicant here has not identified any specific and continuing negotiations that would justify a temporary suspension of the requested disclosure.

V.  Conclusion

[47]           In the result, the Applicant has failed to meet its evidentiary burden to justify an exemption on the basis of either paragraph 20(1)(b), (c) or (d) of the Act. The application is dismissed with costs.

 

 

“E. Heneghan”

Ottawa, Ontario

April 11, 2007

FEDERAL COURT

                                                                

NAMES OF COUNSEL AND SOLICITORS OF RECORD

 

 

 

 

DOCKET:                                          T-1349-05

 

STYLE OF CAUSE:                          131 Queen Street Limited and Attorney General of Canada

 

 

PLACE OF HEARING:                    Ottawa, Ontario

 

DATE OF HEARING:                      January 29, 2007

 

REASONS FOR ORDER:               HENEGHAN J.

 

DATED:                                             April 11, 2007

 

 

 

APPEARANCES:

 

Mr. Benjamin Mills	FOR THE APPLICANT
Ms. Alysia Davies	FOR THE RESPONDENT

 

SOLICITORS OF RECORD:

 

McCarthy Tétrault LLP Ottawa, Ontario	FOR THE APPLICANT
John H. Sims, Q.C. Deputy Attorney General of Canada	FOR THE RESPONDENT