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Newsletter > December 2009

In this issue: 1. Firm and Industry News 2. Her Majesty the Queen in Right of Ontario v. Celadon Canada Inc. (2009 ONCJ 465) CanLII)) [Ontario Court of Justice] 3. The Privatization of Our Prisons: Truth Behind Bars

1. Firm and Industry News

  • The firm’s annual Maritime & Transportation Conference will take place on Friday January 15th, 2009.
  • The Marine Club will be holding its annual meeting and dinner at the Royal York Hotel on Friday January 15th, 2009.

2. Her Majesty the Queen in Right of Ontario v. Celadon Canada Inc. (2009 ONCJ 465) CanLII)) [Ontario Court of Justice]

Celadon Canada Inc. (“Celadon”) is an Ontario based provincially incorporated motor carrier, carrying on an extra-provincial truck undertaking from its head office and principal terminal location in Kitchener, Ontario. It operates extensively in the movement of goods as a common carrier between points in Canada and points in the United States, between the provinces in Canada, including British Columbia and Quebec as well as within Ontario.

Certain Ontario Ministry of Transport inspectors laid charges against Celadon and certain of its drivers under the Ontario Highway Traffic Act and the Ontario Hours of ServiceRegulations. The charges concerned Section 190(6) of the Ontario Highway Traffic Act which provided that drivers are to maintain daily logs and have the same on their person while in charge of a commercial motor vehicle, and under Section 225(5) of the Ontario Hours of Service regulations, Section 27(2) which provides for the integrity of daily logs. The charges were also based on Section 225 of the Highway Traffic Act which provides that a Ministry official or inspectors are authorized to inspect any records required under the legislation.

The Defendants asserted the following defences:

1. They argued that Celadon is an extra-provincial undertaking. As such, it is governed under federal legislation and as such, resort must be made to the federal Motor Transport Act as opposed to the Ontario Highway Traffic Act and in turn, the federally constituted Commercial Vehicle Drivers Hours of Service Regulation. As such, it was asserted that Celadon is not subject to the Ontario Hours of Service and related provincial regulation and it should take any benefit from the sole application of the federal regime. Citing the Canadian constitutional “paramountcy” doctrine, Celadon asserted that federal law takes priority over the application of Ontario law to the extent that the former deals with hours of service.

2. It was a necessary ingredient of this defence that, accounting for the fact that Ontario “inspectors” are delegated certain authority for the purpose of enforcing federal regulations, that to the extent that there are differences between the federal and Ontario regulations, that the authority of the inspectors should be limited to applying provincial law to all local (i.e. from points in Ontario to points elsewhere in Ontario) undertakings and federal regulations to all extra-provincial undertakings.

3. Celadon also asserted an argument that the record-keeping and the inspection powers under the aforementioned Ontario regime constituted “unreasonable search and seizure” contrary to the Canadian Charter of Rights and Freedoms“.

In reply the “Crown” acknowledged that Celadon is an inter-provincial and international trucking company, but asserted that the Ontario Hours of Service regulations are valid provincial legislation relating to highway safety, and are on that basis constitutional applicable to inter-provincial carriers. The Crown submitted that in order to make the provincial Hours of Service regulations effective that measures to monitor compliance are needed such as record-keeping and audits by inspectors pursuant to powers granted under the statutory sections cited above.

The charges stemmed from the inspectors having requested from Celadon GPS records so as to show the location or position of vehicles and drivers which Celadon had refused to produce on the basis of jurisdiction.

The Crown argued that the impugned provisions are valid provincial legislation enacted pursuant to the provinces’ exclusive legislative jurisdiction in respect of highway traffic, for the purpose of safety of highway users. The Crown cited appellate court jurisprudence which has consistently held that there is no vital or essential federal interest that would justify holding transportation undertakings immune from the rules of the road or legislation dealing with the safety in the transportation industry that is provincially enacted pursuant to the Canadian constitution. The Crown also cited case law that where there is no conflict between federal and provincial enactments and no inconsistency, that the “paramountcy” rule would apply. (i.e. such rule holding that where there is an inconsistency between overlapping provincial and federal legislation, then the provincial legislation is then considered inoperative to the extent of the inconsistency). Rather, the Crown asserted that in this case the provincial law simply adds requirements that supplement the requirements of the federal law, it then being possible for Celadon to comply with both laws by complying with the stricter of the two, with the laws applying concurrently.

The court was in agreement with the Crown proposition that where provincial law adds requirements that supplement the requirements of the federal law, it will be possible to comply with both laws by complying with the stricter of the two. Simultaneous compliance with both enactments was clearly possible in this case. There being no conflict in operation between the federal and provincial law, the provincial enactment not frustrating the federal government’s purpose, the court refused to find that there was any conflict between the regimes because of a “trivial difference in the supporting documents” as had been asserted by Celadon.

Accordingly the court ruled, that the aforementioned provisions of the Ontario Highway Traffic Act, and of the Hours of Service Regulations of Ontario are constitutionally enacted and that Celadon and its drivers were bound by the same in respect of their use of the highways and moreover that they are not merely subject to the exclusive jurisdiction of federal laws because of the inter-provincial nature of their business.

Finally, the court found that the recordkeeping and inspection powers as aforesaid under the Ontario Highway Traffic Act, and the Ontario Hours of Service regulation were not unreasonable searches and seizures contrary to the Canadian Charter of Rights and Freedoms.

Gordon Hearn


3. The Privatization of Our Prisons: Truth Behind Bars

The privatization of the prison industry gives rise to the concept known as the “Industrial Prison Complex”, the idea that profit drives the growth of the prison industry. This concept is rampant in the United States but Canada could be next. An example of this idea can be demonstrated by the Government outsourcing its management and control of the prison system to private corporations which may build, operate and run facilities for the Government in a more efficient manner than what would otherwise be possible. The prison industry is becoming one of the fastest growing industries in the United States.

In the United States, which boasts the highest prisoner incarceration rate in the world, there are several corporations including Correctional Corporation of America (CCA), amongst others which see opportunity in steadily growing incarceration rates, and overcrowding prisons leading to what has become a billion dollar a year industry in the United States alone. These companies build, manage and provide services to the prison industry such as healthcare, food, psychiatric, design, and secure transportation services to name but a few.

CCA alone privately owns 44 facilities across the United States providing services for 86,821 prisoners. It’s no surprise its stock value soared nearly 32% in the last year despite the economic downturn. President Obama has allocated $53.4 million dollars to pay for 1000 new contract beds in 2010, and $5.4 billion dollars has been allocated for Immigration and Customs Enforcement, a branch of the United State’s Homeland Security which just recently opened bids for the construction of a detention facility for men to house “Criminal Aliens”.

When inmates are transferred from an overcrowded public prison to a private prison, they are said to be “imported”. The fee paid to the private prison for this importation will range between $2.50-$5.50 per day.

Other ways for the private sector to take advantage of bursting prison populations are through contracting services with prisons. Many well known corporations such as Microsoft, Boeing, Revlon, Dell and Victoria’s Secret (which aint so secret anymore) take advantage of low cost inmate labour, which allows for exploitation of a workforce without having to pay a nickel for overtime, or unemployment insurance, and in many cases even escape with paying well below minimum wage. Low cost prison labour provides “Domestic Sweatshops” for those inmates involved, while drastically reducing costs and maximizing profits for the corporate actors at play. Many products and services manufactured and sold in this manner includes military equipment, paint brushes, airplane parts as well as telemarketing and guide-dog training services.

One concern expressed with the privatization of prisons relates to quality of service that could be provided compared to what the Government could provide. One view is that the Government would be better equipped than the private sector at managing prisons because it will act in the best interest of the public and run prisons to promote the cardinal goals of incarceration: offender rehabilitation; punishment; and public safety. On the other hand, the private sector would arguably put profit ahead of quality and be unable to prioritize the cardinal goals of incarceration with profit. Others argue that Government run prisons lack the incentive to do things better, and that by offloading such responsibilities to the private sector, the Government could minimize its legal exposure to lawsuits and costly liability insurance premiums that act as another Government disincentive.

Upon a review of the privatization of the criminal justice system, one can see the many stakeholders at play. These stakeholders range from inmates, to the public as a whole to private corporate interests all of which play a role in how our criminal justice system is shaped. It would be naive for me to deny the fact that much of what the Government decides is a result of private sector lobbyists advocating for the interests of the wealthy private enterprises. Criminal laws are no exception.

Despite the Government’s rhetoric that “tough on crime” laws are being made to promote “public safety”, the truth behind many laws are simply to continue to bulk up the prison populations to stimulate economic growth and appease corporate players. The imposition of mandatory minimum sentences in Canada and elsewhere, and the “three strikes rule” in the U.S., is further proof that violent offences are not a prerequisite for doing hard time. Caging people for life for stealing a slice of pizza, serves nobody but the corporations who profit from the long-term stay. The Government using media as a platform to play into the fear of the citizenry to support the incarceration of “Criminal Aliens” or “Terrorists” is exactly the message they want you to believe.

Lawson Hennick

This newsletter is published to keep our clients and friends informed of new and important legal developments. It is intended for information purposes only and does not constitute legal advice. You should not act or fail to act on anything based on any of the material contained herein without first consulting with a lawyer. The reading, sending or receiving of information from or via the newsletter does not create a lawyer-client relationship. Unless otherwise noted, all content on this newsletter (the “Content”) including images, illustrations, designs, icons, photographs, and written and other materials are copyrights, trade-marks and/or other intellectual properties owned, controlled or licensed by Fernandes Hearn LLP. The Content may not be otherwise used, reproduced, broadcast, published,or retransmitted without the prior written permission of Fernandes Hearn LLP.

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