Understanding Dunsmuir and the True Impact of the Public/Private Law Divide

As demonstrated earlier, the success of the public/private law dichotomy approach is dependent on the existence of an appropriate private law remedy. In a recent case, Dunsmuir,^[322] the Supreme Court of Canada, in seeking to simplify the discussion on the public law/private law divide and to clarify the locus classicus, Knight, emphasized this aspect of the law.

In Dunsmuir, the issue was whether the Appellant who held an office �at pleasure’ in the civil service of New Brunswick had the right to procedural fairness in the employer’s decision to terminate him. Bastarache and LaBell JJ, speaking for the majority, distinguished Knight in the following terms:

While the majority opinion in Knight properly recognized the important place of a general duty of fairness in administrative law, in our opinion, it incorrectly analyzed the effects of a contract of employment on such a duty. The majority in Knight proceeded on the premise that a duty of fairness based on public law applied unless expressly excluded by the employment contract or the statute (p.681), without consideration of the terms of the contract with regard to fairness issues.^[323]

The Court concluded: �where a dismissal decision is properly within the public authority’s powers and is taken pursuant to a contract of employment, there is no compelling public law purpose for imposing a duty of fairness.’^[324] Further, a �public authority which dismisses an employee pursuant to a contract of employment should not be subject to any additional duty of fairness.’^[325]

At first glance, the conclusions of the Court support the contention that no rationale exists for public law principles to apply. However, there is an important qualification by their Lordships: �where a public employee is protected from wrongful dismissal by contract, his or her remedy should be in private law not in public law.’^[326] This conclusion echoes the dictum of Lord Donaldson MR who, as we saw earlier, emphasized that a contract that gives �the required contractual protection’ fails to be determined in private law.^[327] Clearly, if there is no protection in the contract itself or there is no protection from statute, if the public employee can be dismissed at pleasure then the public employee is entitled to a general duty of procedural fairness.

The justification for granting to the holder of an office at pleasure the right to procedural fairness is that, whether or not just cause is necessary to terminate the employment, fairness dictates that the administrative body making the decision be cognizant of all relevant circumstances surrounding the employment and its termination: Nicholson, supra, p. 328, per Laskin C.J.C. One person capable of providing the administrative body with important insights into the situation is the office-holder himself.^[328]

Since Dunsmuir, it is instructive that other courts have been anxious to explain that the basic principles on the rationales for intervention by way of public law as enumerated in Knight remain, and it is only where an applicant is protected by a private law remedy that the court will not exercise its public law jurisdiction. For example, the decision in Dunsmuir and its impact on Knight was quickly interpreted by the Court of Appeal of British Columbia in Martin.^[329] The issue in this case was whether the Vancouver City Council acted within its statutory authority, in good faith, and in accordance with the principles of procedural fairness in rescinding the appointment of all of the members of a Board (described as �the Board of Variance’) without notice, a hearing or cause. The Court upheld the dismissal, but not before pronouncing on the requirement of procedural fairness. Levine JA reasoned:

In Knight, L’Heureux-Dube J., for the majority of the Supreme Court of Canada, concluded that there is a general duty of procedural fairness, �autonomous of the operation of any statute’ (at 668), resting on a public body in an employer-employee relationship. In Dunsmuir, the Supreme Court of Canada determined that the Knight analysis does not apply where the employment relationship at issue is governed by contract. Justice Bastarache, for the majority, said (at para.

Justice L’Heureux-Dube’s conclusion in Knight, as qualified by Dunsmuir, that public employees not protected by contract are entitled to a general duty of procedural fairness is compelling. It goes against the judicial grain to deny even minimal procedural fairness — notice and the opportunity to be heard — to a person whose position is rescinded without cause. Justice L’Heureux- Dube’s reasoning (at 674) is persuasive:

The justification for granting to the holder of an office at pleasure the right to procedural fairness is that, whether or not just cause is necessary to terminate the employment, fairness dictates that the administrative body making the decision be cognizant of all relevant circumstances surrounding the employment and its termination (Nicholson, supra, at p. 328, per Laskin C. J.) One person capable of providing the administrative body with important insights into the situation is the office holder himself.

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.^[330]

The court in Martin, relying on Knight, emphasized that the duty of procedural fairness in relation to public employees, was �autonomous of the operation of any statute.’^[331]

Both Knight and Martin, therefore, confirm that not every decision by a public body to terminate the appointment of the holder of a public office is subject to procedural fairness.

In Martin, the fact that the employees were mere part-time volunteers and could not therefore be said to have been deprived of their livelihood, nor that the decision made was personal or �specific’ to them, distinguished the case from Knight and the court denied a public law remedy. However, the actual result in the case should in no way detract from the general principles toward judicial review contained therein.

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