Termination saga of Via Rail chair takes another turn

Federal Court of Appeal overturns reinstatement order after Jean Pelletier fired a second time
By Jeffrey R. Smith
|hrreporter.com|Last Updated: 06/13/2008

The reinstatement of a former Via Rail chairman has been overturned by the Federal Court of Appeal after he was fired twice.

Jean Pelletier, 70, formerly chief of staff to Prime Minister Jean Chrétien, was appointed to a five-year term as chairman of Via Rail on Sept. 1, 2001. However, former Olympic gold medalist and Via Rail employee Myriam Bédard testified in February 2004 that Pelletier was involved in the Chrétien government’s sponsorship scandal and he contributed to her departure from the Crown corporation. Pelletier then publicly insulted her, referring to her as a “pitiable” single mother in a media interview.

Pelletier reinstated after firing for public comments

On March 1, 2004, shortly after his comments, Pelletier was fired by the new government under Paul Martin. In November 2005, a federal court ruled Pelletier’s firing was unjustified, saying he deserved to know why he was fired and should have been given a chance to answer the charges.

However, the federal government disagreed with the decision and on Nov. 21, 2005, shortly after he was reinstated as chair of Via Rail, transport minister Jean Lapierre gave him a letter saying his comments about Bédard caused the government to lose confidence in him and were grounds for dismissal. That same day Lapierre announced in the House of Commons that the grounds for his dismissal were “as valid as ever.” Pelletier was invited to provide written reasons as to why he shouldn’t be terminated, which he did on Nov. 30, 2005.

Cabinet fired Pelletier again for lack of confidence

Pelletier met with Lapierre on Dec. 1 and Lapierre told him he would consider the matter “with a clear head” and make a decision. Three weeks later, on Dec. 22, Lapierre recommended Pelletier’s termination and an order-in-council to that effect was adopted.

A federal court once again ruled in Pelletier’s favour on March 30, 2007, saying the government didn’t follow proper procedures in the second termination by not consulting Via Rail’s board of directors. It also said Lapierre was biased against Pelletier and the comments he made in the House of Commons demonstrated that.

A government appeal brought the matter before the Federal Court of Appeal, which disagreed with the lower court’s finding of improper procedure. The appeal court found even though the

Financial Administration Act

and the

Interpretation Act

required consultation with the board of directors before an appointment, consultation was not specifically required for termination and shouldn’t be inferred. The appeal court pointed out the chair was a member of the board of directors and it wouldn’t make sense for him to be consulted on his own termination.

Different standard of fairness for discretionary appointment

When Pelletier was appointed, the appeal court said, he was appointed by the cabinet to serve “at pleasure,” meaning another cabinet order could remove him from his position at any time. The nature of this appointment means there should be a different standard of fairness applied.

In an appointment at pleasure, “the duty of impartiality varies according to the functions of the administrative decision-maker and the question being decided,” the appeal court said.

Ministers and officials who are charged with performing “policy making discretionary functions” did not have the duty of impartiality judiciary and administrative tribunals had.

A decision-maker such as the Minister of Transport has an interest in his activities and functions overseeing a government ministry. Rather than requiring a “reasonable apprehension of bias” to find improper procedure, the appeal court said the standard in this case was whether the minister had a closed mind to the prospect of not terminating Pelletier. When the lower court overturned Pelletier’s termination, it erred by applying the higher standard, the appeal court found.

“The termination of a person appointed by the cabinet during pleasure is essentially a political and discretionary administrative decision,” the appeal court said.

Absence of ‘closed mind’ sufficient

The appeal court found Lapierre was intending to go through with Pelletier’s termination before meeting with him. However, the minister did invite him to provide reasons why he shouldn’t be terminated and told Pelletier he would take some time to consider the situation. This showed although he was looking to fire the Via Rail chair, he was open to the possibility of keeping him. This demonstrated an absence of a “closed mind” and met the lower standard of fairness for a discretionary appointment. His comments in the House of Commons, the appeal court said, were just describing the situation: The government had lost confidence in him and felt the grounds of his first dismissal were still valid.

“The minister decided to recommend to cabinet the termination of Mr. Pelletier. His mind was made up,” the court said. “However, he retained the opportunity to change his mind once he had heard the submissions of Mr. Pelletier.”

Ruling Lapierre did not have a closed mind and his bias was appropriate to his role as a discretionary decision maker, the Federal Court of Appeal set aside Pelletier’s reinstatement and upheld his second firing.

For more information see:

Pelletier c. Canada (Procureur général)

, 2008 CarswellNat 3 (F.C.A.).


From the archives

Canadian Employment Law Today

covered Jean Pelletier’s

first wrongful dismissal suit

in the March 1, 2006, issue. An

online post

on May 9, 2007, looked at his second suit.

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