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Telecom Order CRTC 2019-336

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Ottawa, 25 September 2019

File numbers: 1011-NOC2018-0246 and 4754-616

Determination of costs award with respect to the participation of the Deaf Wireless Canada Consultative Committee in the Telecom and Broadcasting Notice of Consultation 2018-246 proceeding

Application

  1. By letter dated 14 December 2018, the Deaf Wireless Canada Consultative Committee (DWCC) applied for costsFootnote 1 for its participation in the proceeding initiated by Telecom and Broadcasting Notice of Consultation 2018-246 (the proceeding). In the proceeding, pursuant to Order in Council P.C. 2018-0685, 6 June 2018, the Commission sought comments from Canadians concerning their personal experiences with any misleading or aggressive retail sales practices of Canada’s large telecommunications carriers and those carriers’ practices in respect of service bundles that include both broadcasting and telecommunications services. The proceeding led to the Commission’s Report on Misleading or Aggressive Communications Retail Sales Practices.
  2. TELUS Communications Inc. (TCI) filed an intervention, dated 9 January 2019, in response to DWCC’s application. DWCC filed a reply, dated 17 January 2019.
  3. The DWCC submitted that it had met the criteria for an award of costs set out in section 68 of the Canadian Radio-television and Telecommunications Commission Rules of Practice and Procedure (the Rules of Procedure) because it represented a group or class of subscribers that had an interest in the outcome of the proceeding, it had assisted the Commission in developing a better understanding of the matters that were considered, and it had participated in a responsible way.
  4. In particular, the DWCC explained that it is a committee composed of Deaf Canadians who themselves have dealt with, or who have witnessed other Deaf, deaf-blind, or hard-of-hearing (DDBHH) Canadians experience, barriers and shortcomings with telecommunications services salespeople. The DWCC further submitted that it and its joint intervenersFootnote 2 were the only accessibility groups to participate in the proceeding, and that it contributed a distinct point of view by offering the unique views of the greater Canadian Deaf community.
  5. With respect to the group or class of subscribers that the DWCC has submitted it represents, the organization explained that it solicited the views of DDBHH individuals in part through a quadrilingual survey undertaken with its joint interveners, and through the personal experience of the DWCC’s members, who have encountered scenarios in which telecommunications services sales staff have not known about or have outright denied the existence of plans for individuals with accessibility needs.
  6. The DWCC requested that the Commission fix its costs at $48,888.56, consisting of $40,243.75 for consultant and analyst fees, and $8,644.81 for disbursements. Notably, the disbursements claim included $4,888.86 for administrative fees, shown in an invoice charging 10% of the consultant and analyst fees and remaining disbursements for administrative fees. The DWCC filed a bill of costs with its application.
  7. The DWCC submitted that the telecommunications service providers that participated in the proceeding are the appropriate parties to be required to pay any costs awarded by the Commission (the costs respondents). The DWCC also requested that any costs awarded to it be paid to the Canadian Association of the Deaf (CAD).

Answer

  1. TCI did not take a position on whether the DWCC is eligible for costs, but argued that the costs should be reduced by $4,888.86 since the administrative fees are ineligible. In support of its argument, TCI referred to its own and the DWCC’s submissions with respect to the DWCC’s application for costs associated with the proceeding initiated by Telecom Notice of Consultation 2018-98. TCI noted that the DWCC had also claimed administrative fees equivalent to 10% of its other costs in that application. At the time, the DWCC explained that the administrative fees covered activities including accounting, administrative assistant time, executive director time, and office usage. In objecting to this portion of the DWCC’s earlier costs claim, TCI had argued that this fee was made up of general overhead expenses unrelated to the proceeding.Footnote 3
  2. In its submissions regarding the current application for costs, TCI submitted that the administrative fees claimed should be reduced for four other reasons. First, relying on the Commission’s Guidelines for the Assessment of Costs (the Guidelines), as set out in Telecom Regulatory Policy 2010-963, TCI argued that these fees were not incurred as a result of the applicant’s participation in the proceeding and, accordingly, should be disallowed because the costs award regime should not underwrite the general operating expenses of costs applicants. Second, also relying on the Guidelines, TCI argued that the Commission will generally decline to award costs incurred by an applicant’s staff when they are acting in a support or administrative function. Third, the DWCC did not provide receipts or otherwise document the actual expenses incurred, and should not recover costs at the arbitrary amount that it has proposed. Finally, TCI argued that even where overhead expenses have been incurred directly in connection with a proceeding and where costs have been accounted for, the Commission will still generally disallow those expenses.

Reply

  1. In its reply to TCI, the DWCC argued that the administrative fees claimed should be viewed as being directly related to the proceeding given the unique nature of the organization, its operations, and its responsible participation. The DWCC explained that it is a committee of individuals (as opposed to a registered charity or corporation), does not have a bank account, and cannot deposit or issue cheques. Consequently, the DWCC is obliged to hire a third party that will undertake the administrative tasks generated as a result of the DWCC’s participation in Commission proceedings. The DWCC further noted that the administrative fees, which amount to 10% of its total costs claimed, would not have been incurred had it not participated in the proceeding. Finally, the DWCC submitted that even if the Commission generally disallows overhead expenses, the circumstances of this case should meet the threshold for allowing the inclusion of the administrative fees in DWCC’s costs claim.

Request for information

  1. In a letter dated 1 May 2019, the Commission noted that the proceeding related to both telecommunications and broadcasting issues, and that the Commission may award costs related only to telecommunications matters under the Telecommunications Act (the Act). The Commission also indicated that parties claiming costs for broadcasting matters were free to apply to the Broadcasting Participation Fund for the portion of their time dedicated to broadcasting matters in the proceeding.
  2. In the letter, the Commission outlined that the overall division of issues in the proceeding does not necessarily translate into the amount of time that any specific costs applicant spends on either telecommunications or broadcasting matters. In particular, the Commission noted that the individual costs applicants had the best knowledge of the amount of time allocated to particular issues and whether these issues related to telecommunications or broadcasting matters.
  3. Accordingly, the Commission requested that all costs applicants to the proceeding provide the percentage of time spent on telecommunications matters during the proceeding, including supporting information as to how they determined the time allocated to telecommunications as opposed to broadcasting matters.
  4. In its response, dated 13 May 2019, the DWCC submitted that 100% of its costs should be viewed as relating to telecommunications matters, and that the issue of bundling broadcasting services with telecommunications services had arisen in the context of the misleading and aggressive sale of plans for individuals with accessibility needs.

Commission’s analysis and determinations

  1. The criteria for an award of costs are set out in section 68 of the Rules of Procedure, which reads as follows:


    68.    The Commission must determine whether to award final costs and the maximum percentage of costs that is to be awarded on the basis of the following criteria:

    1. whether the applicant had, or was the representative of a group or a class of subscribers that had, an interest in the outcome of the proceeding;
    2. the extent to which the applicant assisted the Commission in developing a better understanding of the matters that were considered; and
    3. whether the applicant participated in the proceeding in a responsible way.
  2. In Telecom Information Bulletin 2016-188, the Commission provided guidance regarding how an applicant may demonstrate that it satisfies the first criterion with respect to its representation of interested subscribers. In the present case, the DWCC has demonstrated that it meets this requirement through its quadrilingual survey and its representation of Deaf Canadians, as a subset of the broader DDBHH community, in accessing telecommunications services.
  3. The DWCC has also satisfied the remaining criteria through its participation in the proceeding. In particular, the DWCC’s submissions, especially those made during the oral hearing, assisted the Commission in developing a better understanding of the matters that were considered from the perspective of Deaf Canadians.
  4. The rates claimed in respect of consultant and analyst fees are in accordance with the rates established in the Guidelines.
  5. The DWCC’s costs claimed in respect of disbursements are generally in accordance with the rates established in the Guidelines. However, the DWCC has not demonstrated that its $4,888.86 administrative fees were necessarily and reasonably incurred in the circumstances of the proceeding. This disbursement, as described by the DWCC, is directed towards administrative and support staff expenses that are not, as set out in the Guidelines, generally eligible for reimbursement through costs awards even when they are specifically connected to a proceeding. The DWCC’s status as an unincorporated committee is not a sufficient reason for the Commission to depart from this general approach, nor is it sufficient that these fees were incurred only because of the DWCC’s participation in the proceeding.
  6. Accordingly, the Commission finds that the $4,888.86 included by the DWCC for administrative fees should be disallowed.
  7. In light of the above, the Commission finds that the total amounts of $40,243.75 for consultant and analyst fees, and $3,755.95 for disbursements, were necessarily and reasonably incurred and should be allowed. Accordingly, the Commission fixes the DWCC’s costs for its participation in the proceeding at $43,999.70.
  8. The Commission accepts the DWCC’s submissions as they relate to the allocation of costs between telecommunications and broadcasting matters, with the entirety of the DWCC’s costs relating to telecommunications matters that may, incidentally, touch on broadcasting matters.
  9. This is an appropriate case in which to fix the costs and dispense with taxation, in accordance with the streamlined procedure set out in Telecom Public Notice 2002-5.
  10. The Commission has generally determined that the appropriate costs respondents to an award of costs are the parties that have a significant interest in the outcome of the proceeding in question and have participated actively in that proceeding. The Commission considers that the following parties, including all their subsidiaries, had a significant interest in the outcome of the proceeding and participated actively in the proceeding: Bell Canada, on its own behalf and on behalf of Bell Aliant, a division of Bell Canada; Bell Mobility Inc.; Bell MTS Inc., Câblevision du Nord de Québec inc.; DMTS, a division of Bell Canada; KMTS, a division of Bell Canada; NorthernTel Limited Partnership; Ontera; and Télébec, Société en commandite (collectively, Bell Canada et al.); Bragg Communications Incorporated, carrying on business as Eastlink; Canadian Network Operators Consortium Inc.; Cogeco Communications Inc.; Northwestel Inc.; Quebecor Media Inc., on behalf of Videotron Ltd. (Videotron); Rogers Communications Canada Inc. (RCCI); Saskatchewan Telecommunications (SaskTel); Shaw Communications Inc. (Shaw); TBayTel; TekSavvy Solutions Inc.; TCI; and Xplornet Communications Inc.
  11. The Commission considers that, consistent with its practice, it is appropriate to allocate the responsibility for payment of costs among costs respondents based on their telecommunications operating revenues (TORs) as an indicator of the relative size and interest of the parties involved in the proceeding.Footnote 4 However, as set out in Telecom Order 2015-160, the Commission considers $1,000 to be the minimum amount that a costs respondent should be required to pay due to the administrative burden that small costs awards impose on both the applicant and costs respondents. Accordingly, the Commission finds that the responsibility for payment of costs should be allocated as follows:
    Company Proportion Amount
    Bell Canada et al. 38.73% $17,039.68
    TCI 25.47% $11,206.22
    RCCI 24.69% $10,864.58
    Videotron 5.06% $2,224.68
    Shaw 3.55% $1,563.20
    SaskTel 2.50% $1,101.34
  12. Consistent with its general approach articulated in Telecom Costs Order 2002-4, the Commission makes Bell Canada responsible for payment on behalf of Bell Canada et al. The Commission leaves it to the members of Bell Canada et al. to determine the appropriate allocation of the costs among themselves.

Directions regarding costs

  1. The Commission approves with changes the application by the DWCC for costs with respect to its participation in the proceeding.
  2. Pursuant to subsection 56(1) of the Act, the Commission fixes the costs to be paid to the DWCC at $43,999.70.
  3. The Commission directs that the award of costs be paid forthwith to CAD for the DWCC by Bell Canada, TCI, RCCI, Videotron, Shaw, and SaskTel according to the proportions set out in paragraph 25.

Secretary General

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