Interjurisdictional immunity

[86] Nevertheless, no matter how it is articulated, the principle of subsidiarity has no application on these facts. The power of the Postmaster General (and its successor, Canada Post) to locate mail receptacles in its national network, free of interference, has existed from Confederation and has been continuously exercised. Canada Post is not displacing any pre-existing local initiatives. And as I noted with respect to the argument from co-operative federalism, a harmonious reading of the CPCA and Regulation together with the By-Law is not possible.

[87] I therefore conclude that there is a conflict between the By-Law on the one hand, and the CPCA and the Regulation on the other, and the application judge made no error in so finding. The By-Law is thus inoperative to the extent of the conflict, including both the permitting and moratorium provisions as they apply to Canada Post.

[88] As the application judge found, the conclusion that there is a conflict for division of powers purposes similarly resolves the question of whether the By-Law is inconsistent with s. 14(1) of the Municipal Act, which renders a by-law that is in conflict with a federal act or regulation of no effect.

[93] The doctrine of interjurisdictional immunity protects the “core” of a legislative head of power from impairment by the actions of a government at the other level: COPA, at para. 26. Its application involves two steps: (1) determining whether a statute or measure adopted by a government at one level trenches on the core of a power of the other government, and (2) determining whether the effect of the statute or measure on the protected power is sufficiently serious to trigger the application of the doctrine: COPA, at para 27.

[94] Its application has wide-ranging consequences and as the Supreme Court recently reiterated, it should be applied “with restraint” and “in general be reserved for situations already covered by precedent”: Bank of Montreal v. Marcotte, 2014 SCC 55, (2014) 2 S.C.R. 725, at para. 63, citing Canadian Western Bank, at paras. 67 and 77.

[95] I agree with the City’s submission that Canada Post has not identified any precedent recommending the application of this doctrine. It is not sufficient that the doctrine has in the past been applied to the head of power of postal services. There needs to be a closer nexus with the actual subject matter of the By-Law.

[96] As this case presents a novel situation with respect to interjurisdictional immunity, the application judge needed to identify some exceptional rationale for extending the doctrine and did not do so. Accordingly, I am of the view that the application of the doctrine in this instance is an error of law.