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ARCHIVED - Telecom Decision CRTC 2004-79

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Telecom Decision CRTC 2004-79

  Ottawa, 6 December 2004
 

Process for MTS Allstream's applications to vary the terms and conditions of existing municipal access agreements with the cities of Toronto and Calgary

  Reference:  8690-A4-01/01 and 8690-A4-04/02
  In this Decision, the Commission denies a request by the Federation of Canadian Municipalities, the City of Edmonton and the City of Vancouver to intervene in two MTS Allstream Part VII applications filed against the City of Toronto and the City of Calgary. The Commission also denies a request by the City of Toronto and the City of Calgary to establish an alternative process, which would include an oral hearing, for making submissions with respect to the MTS Allstream applications.
 

Background

1.

On 28 May 2001, AT&T Canada Corp. (on behalf of itself and AT&T Canada Telecom Services Company), now MTS Allstream Inc. (MTS Allstream), filed a Part VII application requesting that the Commission change the terms and conditions of its existing municipal access agreement (MAA) with the City of Toronto (Toronto) to make those terms and conditions consistent with the principles set out in Ledcor/Vancouver - Construction, operation and maintenance of transmission lines in Vancouver, Decision CRTC 2001-23, 25 January 2001 (Decision 2001-23). The Commission received interventions from the Canadian Cable Television Association (now Canadian Cable Telecommunications Association), TELUS Communications Inc. (TELUS), Bell Canada, GT Group Telecom Services Corp. (subsequently renamed LondonConnect Inc.), and Vidéotron Télécom ltée (collectively, the telecommunications service providers).

2.

The Commission suspended its consideration of MTS Allstream's application and issued Terms and conditions of existing agreements for access to municipal property, Public Notice CRTC 2001-99, 31 August 2001 (Public Notice 2001-99). In this Public Notice, the Commission initiated a proceeding to consider what circumstances, if any, would justify an intervention by the Commission to alter the terms and conditions of an existing contract between a carrier and a municipality for access to municipal rights-of-way.

3.

On 24 June 2002, MTS Allstream filed a Part VII application requesting that the Commission change the terms and conditions of its existing MAA with the City of Calgary (Calgary) to make those terms and conditions consistent with the principles set out in Decision 2001-23. In AT&T Canada Corp. Part VII application re: City of Calgary, Telecom Decision CRTC 2002-46, 9 August 2002, the Commission suspended consideration of this application until such time as the Commission had rendered a determination on the issues raised in Public Notice 2001-99.

4.

In Terms and conditions of existing agreements for access to municipal rights-of-way, Telecom Decision CRTC 2003-82, 4 December 2003 (Decision 2003-82), which resulted from the proceeding initiated by Public Notice 2001-99, the Commission stated that section 43 of the Telecommunications Act (the Act) contemplates that any consideration of access to a municipal right-of-way must be done on a case-by-case basis, bearing in mind the particular circumstances of each case. The Commission also noted that the law consistently recognized circumstances under which a written agreement may not validly represent one or both parties' acceptance of its terms. These circumstances include cases of mistake, duress and inequality of bargaining power. The Commission stated that it was, therefore, prepared to consider applications from Canadian carriers, regarding signed MAAs, seeking to establish that municipal consent was not obtained on terms acceptable to the carrier. The Commission noted that the onus would be on the Canadian carrier to establish that the signed MAA does not represent proof that it has obtained, on terms acceptable to it, municipal consent.

5.

In Decision 2003-82, the Commission determined that the telecommunications service providers did not have a right to intervene in MTS Allstream's application against Toronto. The Commission considered that their interventions would not add anything of substance to the proceeding and that not allowing their participation was consistent with the CRTC Telecommunications Rules of Procedure (the Rules) and the common law duty of fairness.

6.

In Decision 2003-82, the Commission set out a process to consider the MTS Allstream's part VII applications against Toronto and Calgary (the MTS Allstream applications) that had been suspended pending consideration of the issues raised in Public Notice 2001-99.

7.

By letter dated 30 December 2003, the Commission suspended the process set out in Decision 2003-82, at MTS Allstream's request, pending the Federal Court of Appeal's determination on the Federation of Canadian Municipalities' (the FCM) application for leave to appeal Decision 2003-82.

8.

On 5 March 2004, the Federal Court of Appeal dismissed the FCM's application and on 19 April 2004, the Federal Court of Appeal dismissed the motion by the FCM, the City of Edmonton, the City of Vancouver (collectively, the FCM et al.), Calgary and Toronto for reconsideration of the FCM's application for leave to appeal.

9.

By letter dated 20 April 2004, the FCM et al. requested permission to intervene in the MTS Allstream applications, solely for the purpose of making legal argument in each of the two cases.

10.

Toronto and Calgary, by letters dated 20 April 2004 and 21 April 2004, respectively, requested that the Commission establish the following process for making submissions:
 
  • The proceeding be an oral hearing for the purposes of the presentation of evidence and legal argument;
 
  • The parties be permitted to request disclosure/discovery of documents relevant to the issues to be determined in the proceeding;
 
  • The parties be given ample notice of all proposed witnesses and be entitled to conduct examinations for discovery of such witnesses prior to their testimony before the Commission;
 
  • The Commission hear oral testimony relevant to the proceeding for the purpose of permitting the parties to examine and cross-examine witnesses; and
 
  • The parties be precluded from relying on written submissions unless based upon factual evidence that has been properly presented and tested in accordance with the rules of evidence.

11.

On 26 April 2004, the Commission invited interested parties to the proceeding initiated by Public Notice 2001-99 to comment on the proposed alternative process. The Commission received comments on 3 May 2004 from the Town of Fort Erie (Fort Erie), and on 26 May 2004, from TELUS, MTS Allstream, and the Halifax Regional Municipality (Halifax). Toronto and Calgary filed reply comments on 14 June 2004.
 

Intervener status

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Position of parties

12.

The FCM et al. submitted that they should be permitted to intervene in both MTS Allstream applications because the Commission's legal conclusions would establish precedents regarding the Commission's jurisdiction to intervene in existing MAAs that would affect the entire municipal sector. Toronto, Calgary, Halifax and Fort Erie supported the FCM et al.'s request. Toronto submitted that the applications raised fundamental jurisdictional issues of universal importance whose results could adversely affect the interests of all Canadian municipalities. Calgary submitted that the Federal Court of Appeal had not decided that the Commission had broad authority to set aside existing MAAs and had also not obviated the eventuality that Part VII applications might be made in respect to MAAs across Canada. Calgary added that this kept open the national perspective on the MTS Allstream applications. Halifax stated that, in view of the wide potential impact arising from the issues raised by the MTS Allstream applications, it hoped that the Commission would welcome the input from interested parties.

13.

MTS Allstream responded that the FCM et al. did not have sufficient direct interest to intervene. MTS Allstream also indicated that the Federal Court of Appeal, in denying the leave to appeal Decision 2003-82, was not persuaded that the FCM's inability to participate in the Part VII proceedings raised a concern sufficient to grant the appeal.

14.

MTS Allstream and TELUS both submitted that the FCM et al.'s intervention would not add anything of substance to the proceedings. TELUS noted that in Decision 2003-82, the Commission was of the view that not allowing interveners to participate was consistent with the requirements of the Rules and the common law duty of fairness. TELUS submitted that parties had had the opportunity to make extensive legal argument through the proceeding that led to Decision 2003-82. TELUS also submitted that the MTS Allstream applications pertained to fact-specific disputes between two parties and that other parties were not in a position to comment on the facts or circumstances specific to the disputes.

15.

Calgary supported the FCM et al.'s participation to make legal argument in the MTS Allstream Part VII proceedings, submitting that having a national perspective in the legal issues would assist the Commission in coming to a decision in matters with significant precedential impact on municipalities.

16.

Toronto supported intervention by the FCM et al., noting that such participation should be limited to legal argument. Toronto submitted that the Commission had changed the focus of MTS Allstream's applications from whether the Commission could alter the terms of existing MAAs to whether a Canadian carrier had obtained, on terms acceptable to it, the consent of the municipality to construct existing transmission lines. Toronto argued that this raised a new and significant public issue in which the FCM et al. had a direct interest.

17.

Toronto also indicated that the FCM et al. met the test for intervener status set out in Rule 18 of the Supreme Court of Canada Rules, submitting that the FCM et al. (a) had a sufficient precedential interest, and (b) was best able to provide useful and different submissions reflecting the Canadian municipalities' perspective on the legal approach and implications of the applications. Toronto further submitted that the Federal Court of Appeal, in stating that denying the leave to appeal Decision 2003-82 might put parties to the expense of a hearing before the Commission, seemed to have assumed that the FCM would have standing in MTS Allstream's applications.
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Commission's analysis and determination

18.

The Commission, in Decision 2003-82, determined that the telecommunications service providers should not be given intervener status in the dispute between MTS Allstream and Toronto. The Commission determined that the interventions would not add anything of substance to the proceeding and that not allowing the telecommunications service providers to participate was consistent with the requirements of the Rules and the common law duty of fairness. The Commission further notes that, in the proceeding leading to Decision 2003-82, Toronto objected to the interventions on the basis that the dispute was bilateral, between itself and MTS Allstream.

19.

The Commission notes that Toronto argued that the FCM et al. met the test to be granted intervener status before the Supreme Court of Canada. The Commission notes that the Supreme Court of Canada Rules do not apply to proceedings before the Commission and that neither the Act nor the Rules impose a duty on the Commission to allow interventions in disputes between two parties under subsection 43(4) of the Act.

20.

The Commission considers that MTS Allstream's applications do not raise fundamental jurisdictional issues. Jurisdictional issues were addressed in Decision 2003-82, in which the Commission stated that all terms and conditions that would be permanently reflected in the structure of the transmission lines of telecommunications undertakings, or have a direct effect on the operational qualities of the transmission lines, are within exclusive federal jurisdiction. The Commission also ruled that any effects on property and civil rights in a province were incidental. The Commission was of the view that the use of property, such as a municipal highway, to construct transmission lines cannot be divorced from the exclusive federal constitutional jurisdiction over telecommunications undertakings. The Commission went on to address its statutory jurisdiction in the case of existing MAAs and concluded that pursuant to section 43 of the Act, any consideration of access to a municipal right-of-way must be done on a case-by-case basis, bearing in mind the particular circumstances of each case.

21.

The Commission notes that it may, in certain circumstances, owe a common law duty of fairness which may require participation by interveners. However, to trigger the duty of fairness, a party seeking intervener status must be directly and necessarily affected by the decision to be made. The Commission does not consider that the FCM et al. meet the required level of interest to be accorded intervener status. As MTS Allstream's applications deal with bilateral disputes that will turn around the specific circumstances of each case, the Commission considers that the FCM et al.'s and other municipalities' rights and interests will only be affected in an indirect way.

22.

The Commission notes that the FCM et al. actively participated in the proceeding that led to Decision 2003-82. Within the context of that proceeding, the Commission carefully considered the FCM et al.'s submissions, on behalf of its members, on the Commission's jurisdiction and authority to intervene in existing MAAs entered into by a municipality. The Commission notes that the MTS Allstream applications relate to bilateral disputes.Since the Commission will examine each of the MTS Allstream applications on its own merits, in accordance with its findings in Decision 2003-82, the Commission considers that it is not necessary to get the FCM's national perspective to come to a determination.

23.

With regard to Toronto's submission that the Federal Court of Appeal, in denying leave to appeal Decision 2003-82, seemed to have assumed that the FCM et al. would have standing in the proceedings before the Commission, the Commission considers that the Federal Court of Appeal's comments did not assume that the FCM et al. would be allowed to intervene in the MTS Allstream applications. The issue of intervener status was not before the Court.

24.

The Commission also rejects Toronto's claims that the Commission changed the nature and the focus of the MTS Allstream applications in examining the specific questions for discussion in Public Notice 2001-99. The Commission, in Public Notice 2001-99, which led to Decision 2003-82, sought comments on what circumstances, if any, would justify the Commission's intervention in an existing MAA, given the existing regulatory framework. In Decision 2003-82, the Commission found that the law has consistently recognized circumstances under which a written agreement may not validly represent one or both parties' acceptance of its terms. The Commission ruled that it could consider, on a case-by-case basis, applications from Canadian carriers seeking to establish that municipal consent in an existing MAA was not obtained on terms acceptable to the carrier. The Commission therefore does not consider that it has changed the nature and focus of the MTS Allstream applications.

25.

Accordingly, the Commission denies the FCM et al.'s request for permission to intervene in the MTS Allstream applications.
 

Alternative process for making submissions

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Position of parties

26.

Toronto argued that the Commission's normal regulatory written process was insufficient to deal with MTS Allstream's applications. Toronto submitted that, in Decision 2003-82, the Commission denied a request for an oral hearing because there were no facts in dispute and no issues of credibility at issue. Toronto added that the MTS Allstream applications would turn around parties' views of the circumstances that led to the signing of the MAAs and the veracity of the evidence. Toronto submitted that, since questions regarding credibility are normally subject to the evidentiary process of civil courts, the Commission and the parties had to be given every opportunity to challenge, weigh and assess the veracity and the accuracy of the evidence put before the Commission. Fort Erie and Halifax supported Toronto's submission.

27.

MTS Allstream submitted that granting the request for a court-like process would be contrary to the fundamental purpose of administrative tribunals, which were meant to provide a more expedient process than courts. MTS Allstream argued that the proposed procedures would be susceptible to abuse and would seriously impair the timely and efficient resolution of the applications. MTS Allstream added that the Commission had the necessary procedural tools and mechanisms at its disposal to determine the issues on a written basis.

28.

TELUS submitted that an oral hearing was not required, arguing that the Commission had dealt with other complex issues which involved competing facts and circumstances by way of written proceedings.

29.

Calgary replied that the circumstances under which a written contract may not validly represent one or both parties' acceptance of the terms was a civil law concept that applied to all contracts, not just to telecommunications issues. Calgary added that adjudication of the MTS Allstream applications would involve the same legal principles as would a civil action to set aside any type of commercial contract. Calgary submitted that the Commission did not have the specialized skills and expertise to deal with this issue. Calgary added that the Commission could not ascertain, in a paper proceeding, the subjective state of mind of the parties at the time the contract was concluded. Calgary submitted that without the opportunity to examine the parties, through records and cross-examination, the process would be nothing more than the submission of key phrases.

30.

Toronto replied that expediency of resolving disputes was a secondary consideration and could not take precedence over the requirements of natural justice. Toronto submitted that the proposed inquiry was unique and did not fall within the Commission's normal mandate or expertise. Toronto added that the Commission's unprecedented review of an existing agreement, which would have the effect of either affirming or striking out Toronto's vested contractual rights, would have severe financial consequences on Toronto. Toronto argued that it was incumbent on the Commission, in the interests of natural justice, to ensure that every appropriate measure was taken to protect the rights of the parties to a full and fair hearing. Toronto further argued that central to this was Toronto's ability to present its case directly to the Commission and to test the credibility of MTS Allstream's witnesses and evidence.

31.

Toronto also listed decisions in which it submitted that the Federal Court of Appeal and the Supreme Court of Canada repeatedly confirmed that there may be circumstances in the context of a written process where alternative oral processes, such as cross-examination, may be appropriate in the interests of natural justice. Toronto added that it was more likely to be the case where the relevant evidence was conflicting and contradictory.
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Commission's analysis and determination

32.

The Commission, in Decision 2003-82, denied a request by Halifax and Toronto for an oral hearing finding that, in the circumstances of that proceeding, there were no facts in dispute and no issues of credibility at issue.

33.

The Commission notes that the Rules provide the Commission with procedural tools and mechanisms to allow parties to test submissions before the Commission and examine the veracity and credibility of evidence without resorting to a process more akin to civil trials, like the alternative process proposed by Toronto and Calgary. In that respect, the Commission notes that it has dealt with other complex issues in writing, including disputes turning on competing facts and circumstances, using its existing procedural tools and mechanisms and has been able to assess the strength of the evidence and make well-informed decisions. The Commission also notes that, in the circumstances of the MTS Allstream applications, the records of the proceedings do not at this time show that there are any facts in dispute or any credibility issues.

34.

The Commission considers that, given the nature of MTS Allstream's applications, the Commission and the parties will be able to examine, through a written process, the relevant facts and circumstances of these two particular cases. The Commission also considers that the process, including the oral hearing, proposed by Toronto and Calgary would unnecessarily delay the resolution of the MTS Allstream applications.

35.

The Commission accordingly finds that the process proposed by Toronto and Calgary is not necessary to deal with the MTS Allstream applications and denies their request.

36.

Accordingly, MTS Allstream may file submissions, including additional factual material, within 30 days of the date of this Decision on how Decision 2003-82 should be applied in the context of its dispute with Toronto. Toronto may file its answer, including additional factual material, with respect to that matter within 30 days of the filing of MTS Allstream's comments. MTS Allstream may file reply comments no later than 10 days after Toronto has filed its answer. In the case of MTS Allstream's application against Calgary, MTS Allstream may within 30 days of the date of this Decision, amend its application to provide submissions, including additional factual material, on how Decision 2003-82 should be applied in the context of that application. Calgary may file its answer, including factual material, to MTS Allstream's application no later than 30 days after the filing of MTS Allstream's amended application. MTS Allstream may file reply comments no later than 10 days after Calgary has filed its answer. Each party is reminded to provide copies of any submissions to the other party within the deadlines specified. Parties are also reminded that where a date is specified for filing and serving submissions, they must actually be received by that date and not merely be sent.
  Secretary General
  This document is available in alternative format upon request and may also be examined at the following Internet site: http://www.crtc.gc.ca

Date Modified: 2004-12-06

Date modified: