Determination No. R-2018-215

October 9, 2018

APPLICATION by Savage CANAC Corporation (Savage) pursuant to section 91 of the Canada Transportation Act, S.C., 1996, c. 10, as amended (CTA) for a certificate of fitness to operate a railway.

Case number: 
18-04081

SUMMARY

[1] Savage applied to the Canadian Transportation Agency (Agency) for a certificate of fitness to operate a railway. The Agency dismisses the application, having found that the railway does not fall within the legislative authority of Parliament and thus, is not within the purview of the Agency.

APPLICATION

[2] On July 25, 2018, Savage applied to the Agency for a certificate of fitness “[…] to operate a railway between the international pier on the waterfront in Sydney and the Lingan power generating plant. The railway lines through the coal storage facility at Victoria Junction, including the railway maintenance center, and a portion of the Glace Bay railway line between the railway maintenance center and the end of the Old Tank siding, Cape Breton Island, in the province of Nova Scotia” (collectively referred to as “the railway”).

BACKGROUND

[3] On July 27, 2015, the Agency issued a certificate of fitness to Logistec Stevedoring (Nova Scotia) Inc. (Logistec) to operate the railway. On July 18, 2018, Logistec informed the Agency that it would cease to operate the railway on July 28, 2018. On July 23, 2018, Logistec also confirmed that there would be no insurance on the railway and its assets as of midnight, July 28, 2018. Consequently, on July 27, 2018, by Order No. 2018-R-130, pursuant to section 94.2 of the CTA, effective midnight, July 28, 2018, the Agency cancelled Certificate of Fitness No. 15001.

[4] In the meantime, on July 16, 2018, the Agency was also informed by Nova Scotia Power Inc. that it was the owner of the railway and that it had contracted Savage to assume the responsibility for the provision of the operating services of the railway.

ISSUE

[5] In reviewing an application for a certificate of fitness, the Agency must first determine whether the proposed operation of the railway is within the legislative authority of Parliament and, therefore, if it is required to hold a certificate of fitness pursuant to subsection 91(1) of the CTA.

ANALYSIS AND FINDING

[6] In 2015, in Decision No. 236-R-2015, the Agency issued a certificate of fitness to Logistec to operate the railway. The Agency noted that Logistec had acquired the railway and would continue its operation. The Agency also noted that the railway was, by virtue of section 5 of the Cape Breton Development Corporation Divestiture Authorization and Dissolution Act, S.C., 2000, c. 23, declared to be a work for the general advantage of Canada.

[7] Subsection 90(1) of the CTA provides that no person shall construct or operate a railway without a certificate of fitness. “Railway” is defined in section 87 of the CTA as a railway within the legislative authority of Parliament.

[8] Therefore, to obtain a certificate of fitness, an applicant must first demonstrate that the certificate for which it applies relates to a railway that is within the legislative authority of Parliament. The certificate of fitness in respect of the railway was previously issued by the Agency on the basis that it was under the legislative authority of Parliament as a result of having been declared to be a work for the general advantage of Canada.

[9] Subsection 88(4) of the CTA provides for the cessation of a declaration that a railway is a work for the general advantage of Canada when the railway is subject to a transfer made under Division V of the CTA to a person who does not operate a railway within the legislative authority of Parliament.

[10] With respect to Subsection 88(4), a declaration by subsection (3) or by any other Act of Parliament that a railway is a work for the general advantage of Canada, or for the advantage of two or more provinces, ceases to have effect with respect to a line of the railway, or a portion of it, whose operation is discontinued under Division V or is the subject of a transfer under that Division to a person other than a railway company mentioned in paragraph 88(2)(b).

[11] As part of Savage’s application for a certificate of fitness for the operation of that railway, the Agency notes that Nova Scotia Power Inc. is the owner of the railway. Nova Scotia Power Inc. is not a railway company within the meaning of paragraph 88(2)(b). As the railway was transferred to a person other than a company operating a railway within the legislative authority of Parliament, the declaration that the railway is a work for the general advantage of Canada ceased to have effect.

CONCLUSION

[12] Consequently, the railway is no longer within the legislative authority of Parliament and no certificate of fitness is required for the operation of that railway.

Member(s)

J. Mark MacKeigan
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