Importing a Public Law Element into the Contract on Grounds of Public Policy
The courts have also identified public policy as a compelling reason for incorporating public law principles into a contract of employment where a statutory authority is the employer.
In the public policy cases, the dicta goes beyond mere procedural fairness and suggests broader notions of the legitimate use of state power. Such a rationale is more in keeping with the constitutional safeguards in relation to state power envisaged by the founding fathers.In Knight, for example, it was stated:
The conclusion that the respondent’s employment could be legally terminated without a showing of just cause does not necessarily entail that the procedure involved can be arbitrary. There may be a general right to procedural fairness, autonomous of the operation of any statute, depending on consideration of three factors which have been held by this court to be determinative of the existence of such a right: Cardinal v. Kent Inst., supra. If consideration of these factors in the context of the present appeal leads to the conclusion that the respondent was entitled to procedural fairness, the Education Act and, in this case, the terms of the contract of employment must then be considered to determine whether this entitlement is either limited or excluded entirely. It should be noted at this point that the duty to act fairly does not depend on doctrines of employment law, but stems from the fact that the employer is a public body whose powers are derived from statute, powers that must be exercised according to the rules of administrative law. It is in that context that the employee-employer relationship between the respondent and the appellant board must be examined, with the result that the analysis must go beyond the contract of employment to encompass arguments of public policy.[311]
The public policy context is explained further in Martin v Vancouver (City), a judgment from the British Columbia Court of Appeal, relying on the earlier landmark case of Knight.
Here, it was stated:Justice L’Heureux-Dube’s comments (at 668) that �the duty to act fairly does not depend on doctrines of employment law, but stems from the fact that the employer is a public body whose powers are derived from statute, powers that must be exercised according to the rules of administrative law’, and (at 669) that �the analysis must encompass arguments of public policy’, have resonance in this case.
She explained further (at 675):
There is also a wider public policy argument militating in favour of the imposition of a duty to act fairly on administrative bodies making decisions similar to the one impugned in the case at bar. The powers exercised by the appellant Board are delegated statutory powers which, as much as the statutory powers exercised directly by the government, should be put only to legitimate use. As opposed to the employment cases dealing with �pure master and servant' relationships, where no delegated statutory powers are involved, the public has an interest in the proper use of delegated power by administrative bodies.[312]
8.