Real Estate Bulletin

September 2016

The Supreme Court of Canada

Renders a Long Awaited Ruling
regarding the Power to Situate
Radiocommunication Antenna
Systems
The proliferation of the number of radiocommunication antennas and
other radiocommunication systems in Canada in recent years in
response to the growing demand of cellular radiocommunication
network users has given rise to numerous conflicts opposing, on the
one hand, telecommunication firms asserting the scope of federal
jurisdiction over radiocommunication and, on the other hand, cities
and municipalities, seeking control with respect to the development
of their territories. 1 On June 16, 2016, the Supreme Court of Canada
sealed the fate of a legal dispute opposing Rogers Communications
Inc. (Rogers) to the City of Chteauguay (Chteauguay) 2 since
2008 and, by so doing, also put an end to years of uncertainty with
respect to the extent of the municipalities powers regarding the
determination of the location of radiocommunication antenna
systems. On the basis of constitutional grounds, the Supreme Court
of Canada found in favour of Rogers and confirmed the paramountcy
of federal power over radiocommunication.

1
See for example: Situation in St-Austin, see http://www.lapresse.ca/la-tribune/actualites/estrie-et-
regions/201512/21/01-4933369-tours-de-telecommunication-austin-se-dresse-contre-videotron.php, published on
December 21, 2015; Situation in Chambly, see http://www.journaldechambly.com/actualites/2016/5/9/l_installation-
dune-antenne-de-telecommunication-seme-la-grogne.html, published on May 9, 2016.
2
Rogers Communications Inc. v. Chteauguay (City), 2016 SCC 23.

McMillan LLP Brookfield Place, 181 Bay Street, Suite 4400, Toronto, Ontario, Canada M5J 2T3
Vancouver Calgary Toronto Ottawa Montral Hong Kong mcmillan.ca
 Page 2

Facts

Rogers is a communications and media company that holds a

spectrum license. This license requires Rogers to provide services in
precisely specified Canadian geographic areas. Among such areas is
the City of Chteauguay, where Rogers wished to build a new
radiocommunication tower in order to fill certain coverage gaps in its
network. In order to comply with the terms of its license, Rogers
undertook to build a radiocommunication antenna system on the
property located at 411 Saint-Francis Boulevard (411 Saint-
Francis). Such installation was agreed to by the owner of the
property.

In March 2008, Rogers informed Chteauguay of its intention to

materialize its construction project. Consequently, Rogers requested
the authorization of the federal Minister of Industry (the Minister)
for a specific site, as provided in the Radiocommunication Act, and
subsequently initiated the 120-day public consultation process, as
required under the Industry Canada circular. Rogers also notified the
residents and property owners living in a determined area adjacent
to 411 Saint-Francis and published a notice in a local newspaper.

On April 28, 2008, Chteauguay notified Rogers of its opposition to

the project. Chteauguay argued that the project would be visually
disagreeable and contravened its zoning by-law, and raised questions
regarding the potential adverse impact of the project on the health
and safety of residents living in the area. Chteauguay then
suggested three alternatives to Rogers: to install the new antenna on
an existing site; to increase the power of the signal from an existing
antenna already operated by Rogers; or to complete the project on a
new property located at 50 Industriel Boulevard (50 Industriel).

Later that year, Rogers advised Chteauguay that all of the proposed
alternatives were inadequate. After review, Rogers argued that the
existing site and antenna were inadequate and that 50 Industriel was
not available for its project. Rogers also confirmed the compliance of
the projected tower with the requirements established by Health

McMillan LLP mcmillan.ca

 Page 3

Canada in Safety Code 6 3 with respect to limits of exposure to

radiofrequency. In February 2009, Chteauguay finally issued a
building permit to Rogers to complete the project at 411 Saint-
Francis.

Subsequently, Chteauguay received a petition signed by several

residents opposing the project, resulting in the resumption of the
public consultation process. On September 21, 2009, the Minister, by
virtue of its powers under the Radiocommunication Act, determined
that the consultation process had been completed satisfactorily and
that the project would not negatively impact the environment. The
Minister nevertheless expressed its wish that Rogers and
Chteauguay come to a mutually agreeable arrangement. The
Minister indicated that it would give the opportunity to Chteauguay
to find an alternative site to 411 Saint-Francis before rendering its
final decision regarding the location of Rogers tower. Chteauguay
then again proposed the 50 Boulevard Industriel property as an
alternative site for the new antenna system, as this site was also
located within the designated search area. Chteauguay notified
Rogers of its intention to acquire that property either by mutual
agreement or by way of expropriation. Rogers agreed to consider this
alternative location, on the condition that the transaction between
Chteauguay and the owner of that property were to take place no
later than February 15, 2010. However, a third party (Christina
White) purchased 50 Industriel before Chteauguays municipal
council could adopt a resolution authorizing the expropriation.
Chteauguay ultimately published a notice of expropriation for 50
Industriel on the land register. This publication, however, occured
after the expiry of the deadline determined by Rogers. Ms. White
then filed a petition to contest such notice of expropriation a few
days later.

Concerned that the expropriation proceedings would drag on, Rogers

asked the Minister to determine the location of the projected tower.
On July 26, 2010, the Minister finally approved the installation of the
tower at 411 Saint-Francis. By doing so, the Ministry put an end to

3
See Safety Code 6: Health Canada's Radiofrequency Exposure Guidelines, online: http://www.hc-sc.gc.ca/ewh-
semt/pubs/radiation/radio_guide-lignes_direct/index-eng.php.

McMillan LLP mcmillan.ca

 Page 4

months of public consultation and discussions between Chteauguay

and Rogers.

Following the Ministers decision, Rogers informed Chteauguay that

it would proceed with the construction of its tower at 411 Saint-
Francis. In October of the same year, Chteauguay asked Rogers to
delay the work until a decision was rendered with respect to the
expropriation of 50 Industriel and, in the event of an adverse ruling,
agreed to allow the construction of the tower at 411 Saint-Francis.

However, in the meantime, the City adopted a resolution authorizing

the creation of a land reserve on 411 Saint-Francis, which lead to
Rogers rejecting Chteauguays offer. On October 12, 2010, Rogers
was served with the notice of reserve for 411 Saint-Francis,
applicable for a term of 2 years and prohibiting any new construction
on the property. Rogers then filed a motion to contest the notice,
alleging that such a notice was unconstitutional as it intruded on the
federal power of radiocommunication. Such notice of reserve was
renewed for an additional term of 2 years before its initial expiry.

Judgments of the Lower Courts

(a) Superior Court

The Superior Court annulled the notice of reserve registered by the

City of Chteauguay. First, the judge concluded that Chteauguay
had acted to further a valid municipal purpose and in the interest of
the health and well-being of its residents by exercising its
expropriation power with respect to the property at 50 Boulevard
Industriel. According to the Court, such a power was not exercised to
favour the interests of a private entity and was not abusive. 4
Second, the Court held that the notice of reserve registered by
Chteauguay did not encroach on the exclusive federal jurisdiction
with respect to radiocommunication, as it did not require Rogers to
use 50 Industriel. However, despite these two findings in favour of
Chteauguay, the judge found that the discretion conferred on a
municipality to establish a reserve was exercised in bad faith, as it
was intended to prevent the construction of the tower, the whole in

4
Argument based on 114957 Canada Lte (Spraytech, Socit d'arrosage) v. Hudson (Town), 2001 SCC 40.

McMillan LLP mcmillan.ca

 Page 5

violation of administrative law principles. The notice of reserve was

therefore annulled on administrative law grounds rather than
pursuant to constitutional principles.

(b) Court of Appeal

The Court of Appeal was of the view that municipalities have

decisional powers with regard to the development of their territory
and the preservation of the health and well-being of their citizens,
notwithstanding the exclusive federal jurisdiction over
radiocommunication. In addition, the Court observed that it was
difficult to conclude to the bad faith of Chteauguay when it issued
its reserve and expropriation notices, as it was acting to pursue
legitimate goals. The Court also rejected the constitutional
arguments put forward by Rogers. The Court concluded that the
determination of the location of a radiocommunication tower was not
an essential element of the federal jurisdiction over
radiocommunication. Therefore, the Court of Appeal held that
Chteauguays notice of reserve was valid and did not infringe upon
federal powers.

The Supreme Court Ruling

(a) Arguments of the Parties

Rogers argued that the sole purpose and effect of the notice of
reserve was to prevent it from constructing its antenna system at
411 Saint-Francis. It also argued that the notice related, in pith and
substance, to the siting of radiocommunication infrastructure.
According to Rogers, the notice of reserve was therefore
unconstitutional, since it fell within exclusive federal jurisdiction over
radiocommunication. According to Chteauguay, in order to ascertain
the pith and substance of the notice of reserve, it was necessary to
distinguish the effective impact of the notice of reserve from its
intended purpose. It contended that the ultimate purpose of the
reserve was to protect the health and well being of its residents living
close to 411 Saint-Francis and to ensure the development of its
territory. Chteauguay thus argued that since these are matters that
fall within the provincial powers with respect to Property and Civil
Rights in the Province and Generally all Matters of a merely local or

McMillan LLP mcmillan.ca

 Page 6

private Nature in the Province granted pursuant to the Constitution

Act, 1867, the notice of reserve was therefore intra vires and
constituted a legitimate exercise of the powers delegated to it.

(b) Doctrine of Pith and Substance

The majority of the Supreme Court of Canada was of the view that
the notice of reserve is ultra vires of the powers attributed to
Chteauguay, and concluded that it should be annulled. For several
grounds, the Court considered that the issuance of the notice of
reserve constituted an exercise of the powers over
radiocommunication, which falls within exclusive federal jurisdiction.
To reach such a conclusion, the Court analyzed the pith and
substance of the notice of reserve by interpreting its purpose and
effects. The evidence adduced showed that the notice of reserve was
registered subsequent to the approval of the project by the Minister,
immediately after the refusal of Chteauguays proposal to Rogers
and immediately after Rogers announced its intention to go forward
with the construction of its antennas at 411 Saint-Francis. According
to the Court, even by constructing these facts generously, one could
only conclude that the purpose of the notice of reserve was to
prevent Rogers from installing its radiocommunication antenna
system at 411 Saint-Francis by limiting the possible choices for the
systems location. Indeed, from a legal standpoint, it prohibited all
construction on the property at 411 Saint-Francis for a period of 2
years and, from a practical standpoint, it prevented Rogers from
constructing its antenna system on the property of its choice and
approved by the Minister. Therefore, even though the adoption of the
notice of reserve was aimed at protecting residents of Chteauguay,
its practical and legal impacts were the intrusion upon federal
jurisdiction over radiocommunication.

According to the Court, to hold otherwise could lead to municipalities

systematically intruding on the federal power to choose where to
locate radiocommunication infrastructure by invoking local interests.
The Court explained, however, that the Courts decision must not be
interpreted as indicating that a municipality exercises a federal power
when it supports a firm such as Rogers in an antenna system
installation process via the exercise of expropriating powers. In such
a case, a municipality would not be choosing the location of an

McMillan LLP mcmillan.ca

 Page 7

antenna system, and its actions would simply be related to the

development of its territory, which is permitted under the division of
powers. Such collaboration by a city pursues a development purpose,
which falls within its jurisdiction. Conversely, the Court observed that
where a municipality objects to the construction of a tower for which
the location has been approved by the Minister, the municipality is
then exercising the federal jurisdiction to determine the location of
the infrastructure necessary to the deployment of a
radiocommunication network.

The Court also firmly rejected Chteauguays key argument based on

the principle of co-operative federalism. In the words of the Court,
this principle can neither override nor modify the division of powers
conferred by the Constitution Act, 1867, and cannot impose limits on
the exercise of exclusive legislative authority or validate an otherwise
unconstitutional notice. Because of its pith and substance, which is of
exclusive federal jurisdiction, the challenged measure does not
present a two-fold aspect, namely a provincial aspect with respect to
healthcare, and a federal aspect with respect to radiocommunication.
The Court concluded that, based on the facts presented before the
Court, the contrast between the materiality of the two aspects is very
marked: the federal jurisdiction is much more significant.
Recognizing the opposite would contradict the precedent established
by the Privy Council in In re Regulation and Control of Radio
Communication in Canada, 5 to the effect that the federal jurisdiction
over the siting of such infrastructure is exclusive. Consequently, the
Court held that the notice of reserve was made ultra vires of
Chteauguays powers and competence.

(c) Doctrine of Interjurisdictional Immunity

Even though the Court found that the doctrine of pith and substance
sufficed to dispose of the appeal in favour of Rogers, it nevertheless
went on to apply the doctrine of interjurisdictional immunity to clarify
the applicable law and further substantiate its decision.

This doctrine has the effect of protecting a jurisdiction (e.g. federal)

against intrusions that may be made by another legislative banch (in

5
[1932] A.C. 304.

McMillan LLP mcmillan.ca

 Page 8

the present case, provincial or municipal). In practice, the Court has

to assess whether a particular measure intrudes on the core of a
given jurisdiction, and if so, it must determine whether the impact of
such intrusion is serious or significant.

The parties submitted various arguments regarding the doctrine of

interjurisdictional immunity. On the one hand, Rogers claimed that
the doctrine of interjurisdictional immunity protected the exercise of
activities falling within the core of a federal jurisdiction. On the other
hand, Chteauguay maintained that the core of the federal
jurisdiction did not include the selection of a specific location within
an area determined by Rogers. Alternatively, Chteauguay alleged
that the notice of reserve did not intrude the federal jurisdiction in a
sufficiently serious and significant matter, as it only had the effect of
delaying the construction of the radio tower.

The Court found that it had to follow the precedent established in

Toronto Corporation v. Bell Telephone Co. of Canada, 6 which held
that the location of poles and cables falls within the core of federal
power over radiocommunication, and determined that the siting of
antennas, like the choice of location for poles and cables, is at the
core of the federal power over radiocommunication. This view was
strengthened by the testimony of Rogers manager of radio
engineering, 7 who explained that the designated location of a tower
must be scrupulously observed, as a simple derivation of 100 or 200
meters can undermine the effectiveness of the radiocommunication
network. The Court therefore concluded that the determination of the
location of antenna systems is at the core of the federal jurisdiction
over radiocommunication, notably since the efficient operation of the
cellular network is greatly impacted by this decision. The Court is of
the view that Parliament should have the power to rule on this to
adequately fulfill the jurisdiction that it enjoys.

The Court added that the notice of reserve did not simply affect the
federal power over radiocommunication; it seriously and significantly

6
[1905] A.C. 52.
7
And other sources, see: Telus Communications Co. v. Toronto (City) (2007), 84 O.R. (3d) 656 (C.S.J.), at para 30;
Telecommunications and the Constitution: Re-Setting the Bounds of Federal Authority (2010), 89 R. Can. 695, at p
726.

McMillan LLP mcmillan.ca

 Page 9

impaired it, as demonstrated by the fact that the notice of reserve

prevented Rogers from constructing its antenna system for four
years without an alternative solution achievable within a short time
being offered to Rogers. As a result of the notice and in light of
Chteauguays offer, Rogers had no other choice but to wait until the
end of the expropriation proceedings relating to 50 Industriel, or wait
for the expiry of a period of about seven months. Since this situation
prevented Rogers from fulfilling its obligations under its spectrum
license, the notice of reserve compromised the orderly development
and efficient operation of radiocommunication and impaired the core
of the federal power over radiocommunication in Canada. 8 For
these reasons, the Court concluded that the notice of reserve
published by Chteauguay constituted a serious and significant
intrusion to the core of the federal power over radiocommunication
and was therefore inapplicable to Rogers.

(d) Dissenting opinion

Justice Gason agreed with his colleagues on the outcome of the

appeal, but not with their reasons. According to Gascon J., the notice
of reserve was intra vires, since the circumstances surrounding its
adoption revealed an intended purpose of protecting the health and
safety of citizens and not an express opposition to the construction of
the tower. Despite its practical effect of preventing the construction
of radiocommunication antennas, Gagnon J. concluded that the legal
effect of the notice of reserve was the exercise by the City of its
jurisdiction with respect to the development of its territory via its
expropriation powers. Moreover, he observed that the measure in
issue also pursued the main goal of harmoniously developing
municipal territory. Therefore, he was of the view that Chteauguays
notice of reserve fell within the municipalitys jurisdiction under the
Constitution Act, 1867.

According to Gascon J., this flexible approach of the pith and

substance doctrine promotes subsidiarity and co-operative

federalism. That said, this approach is insufficient to side with

Chteauguays position since under the doctrine of interjurisdictional

8
Rogers Communications Inc. v. Chteauguay (City), supra, note 2, at para 71.

McMillan LLP mcmillan.ca

 Page 10

immunity, the notice of reserve intrudes significantly upon the core

of federal jurisdiction over

radiocommunication by preventing the use of the site determined by

the Minister under the Radiocommunication Act and the circular.
Therefore, Gascon J. sided with the majority of the Court as to the
outcome of the appeal.

Conclusion

Based on partially different grounds, the majority and the dissent of

the Supreme Court of Canada set aside the Court of Appeals
judgment, therefore annulling the notice of reserve and allowing
Rogers to install its radiocommunication antennas at 411 Saint-
Francis. In so doing, the Court explicitly confirmed that the ultimate
choice of the location of radiocommunication infrastructure is at the
core of the federal power over radiocommunication. While the
municipalities may raise their concerns and preferences during the
course of the consultation process, they cannot block this process, as
this would threaten the orderly and efficient development of
radiocommunication in Canada. Therefore, once the consultation
process requirements have been fulfilled and the Ministers approval
has been obtained, the municipalities concerns, whether relating to
aesthetic, sanitary, safety or other concerns, cannot prevent a
communication company from choosing the location for the
installation of its radiocommunication tower.

by Stphanie Hamelin

For more information on this topic, please contact:

Montreal Stphanie Hamelin 514.987.5085 stephanie.hamelin@mcmillan.ca

a cautionary note

The foregoing provides only an overview and does not constitute legal advice. Readers are
cautioned against making any decisions based on this material alone. Rather, specific legal
advice should be obtained.

McMillan LLP 2016

McMillan LLP mcmillan.ca