Ottawa (Rajeev Sharma): The Supreme Court of Canada has agreed to hear a case that could redefine how railway companies contest regulatory findings related to service obligations.
At the centre of the dispute is a November 2023 decision by the Canadian Transportation Agency, which determined that Canadian National Railway Co. (CN) failed to meet its statutory service responsibilities to Alberta Pacific Forest Industries Inc., a major forestry producer.
The agency, a quasi-judicial body operating under the Canadian Transportation Act, has the authority to adjudicate complaints involving federally regulated transportation providers. Under that law, parties may appeal agency decisions to the Federal Court of Appeal—but only on questions of law or jurisdiction.
Rather than following that route, CN sought to challenge the agency’s factual conclusions by invoking the broader Federal Courts Act. The railway argued that this path allowed it to contest the regulator’s findings more expansively.
In September, the Federal Court of Appeal dismissed CN’s attempt, reaffirming established jurisprudence that factual determinations by the transportation agency are not subject to appeal under the Federal Courts Act. The appellate court emphasized that the Canadian Transportation Act sets out a distinct review framework and assigns the power to vary or rescind agency decisions to the Governor in Council, acting on cabinet advice.
By taking up the matter, the Supreme Court is expected to clarify the boundaries between statutory appeal mechanisms and judicial review in regulatory disputes. Legal observers say the ruling could have broad implications not only for the rail sector but also for how federally regulated industries challenge administrative decisions.
The forthcoming judgment is anticipated to provide guidance on the balance between regulatory oversight and the legal avenues available to companies seeking to contest agency findings.
