Decisions

TATC File No. O-2988-10
MoT File No. 5008-FYTC

TRANSPORTATION APPEAL TRIBUNAL OF CANADA

BETWEEN:

Sierra Fox Inc., Applicant

- and -

Minister of Transport, Respondent

LEGISLATION:
Aeronautics Act, R.S.C. 1985, c. A-2, ss. 7.1(1)(b), 8.5
Canadian Aviation Regulations, SOR/96-433, ss. 605.86(1)(b), 605.94(1),


Review Determination
James E. Lockyer


Decision: August 27, 2004

I find the Notice of Suspension of the certificate of airworthiness of aircraft C-FYTC was an appropriate measure in the circumstances; therefore, the suspension is confirmed.

A review hearing on these matters was held Wednesday, June 16, 2004 and Wednesday July 14, 2004 at the Barrie Courthouse, in Barrie, Ontario.

BACKGROUND

On March 22, 2004, a Notice of Assessment of Monetary Penalty was sent by the Minister of Transport to Sierra Fox Inc. of Gravenhurst, Ontario and directed to the attention of Mr. Sandro Ferrari. It stated:

Pursuant to section 7.7 of the Aeronautics Act, the Minister of Transport has decided to assess a monetary penalty on the grounds that you have contravened the following provision (s):

Charge #1:

605. 86(1) which states, in part, "Subject to subsection (3), no person shall conduct a take-off in an aircraft, or permit a take-off to be conducted in an aircraft that is in the person's legal custody and control, unless the aircraft is maintained in accordance with (a) a maintenance schedule that conforms to the Aircraft Equipment and Maintenance Standard; and (b) where the aircraft is operated under Subpart 6 of Part IV or under Part 4, or is a large aircraft, a turbine-powered pressurized aircraft or an airship, a maintenance schedule approved by the minister in respect of the aircraft operator pursuant to subsection (2)."

Offense #1

During the time period from August 01, 2003 and September 30, 2003, Sierra Fox Inc. permitted a take-off to be conducted in the aircraft bearing the registration marks C-FYTC that was in its legal custody and control when the aircraft had not been maintained in accordance with its approved maintenance schedule. Specifically, flights had been conducted on the aforementioned aircraft and not recorded in the aircraft's Journey Logbook that caused the calculation of Total Air Time (TAT) on the aircraft to be inaccurate.

The monetary penalty assessed for this infraction was $1,250.00

Charge #2:

605. 94(1) which states in part, "The particulars set out in column I of an item in Schedule I to this Division shall be recorded in the journey log at the time set out in column II of the item and by the person responsible for making entries set out in column III of that item."

Offense #1

During the time period from August 01, 2003 and September 30, 2003, Sierra Fox Inc. operated the aircraft bearing the registration marks C-FYTC in several flights at or near Muskoka Airport and failed to record the air time or the cumulative total air time in the Aircraft Journey Logbook in accordance with the particulars, as set out in column I, schedule I of subsection 605.94 (1) of the Canadian Aviation Regulations (CARs), thereby contravening CARs 605.94 (1).

The monetary penalty assessed for this infraction was $500.00

The monetary penalty for both charges assessed against Sierra Fox Inc. totalled $1,750.00.

The certificate of airworthiness of aircraft C-FYTC was suspended on October 31, 2003. The notice of suspension states in part:

Pursuant to section 7.1 (1)(b) of the Aeronautics Act, the Minister of Transport has decided to suspend the Certificate of Airworthiness, the Special Certificate of Airworthiness or the Flight Permit in respect of the above aircraft on the ground that the aircraft does not comply with conditions subject to which the document was issued for the following reasons:

The aircraft had not been maintained in accordance with the approved maintenance schedule as required by CAR 605.86 1(b). It was noted that flights had been conducted and not recorded in the Aircraft Journey Log Book. These discrepancies have rendered the calculation of Total Air Time inaccurate.

The suspension remains in effect.

THE LAW

Section 605.86 of the Canadian Aviation Regulations (CARs) states:

Maintenance Schedule

605. 86 (1) Subject to subsection (3), no person shall conduct a take-off in an aircraft, or permit a take-off to be conducted in an aircraft that is in the person's legal custody and control, unless the aircraft is maintained in accordance with

(a) a maintenance schedule that conforms to the Aircraft Equipment and Maintenance Standards; and

(b) where the aircraft is operated under Subpart 6 of Part IV or under Part VII, or is a large aircraft, a turbine-powered pressurized aircraft or an airship, a maintenance schedule approved by the Minister in respect of the aircraft operator pursuant to subsection (2).

(2) The Minister shall approve a maintenance schedule in respect of an aircraft if the schedule conforms to the Aircraft Equipment and Maintenance Standards.

(3) The Minister shall authorize an operator to deviate from the requirements of the applicable maintenance schedule where the operator

(a) submits a request in writing to the Minister in accordance with the Aircraft Equipment and Maintenance Standards; and

(b) demonstrates that the deviation will not affect aviation safety.

Section 605.94 of the CARs states in part:

Journey Log Requirements

605. 94 (1) The particulars set out in column I of an item in Schedule I to this Division shall be recorded in the journey log at the time set out in column II of the item and by the person responsible for making entries set out in column III of that item.

(2) No person shall make a single entry in a journey log in respect of a series of flights unless

(a) the aircraft is operated by the same pilot-in-command throughout the series; or

(b) a daily flight record is used pursuant to section 406.56.

Schedule I, item 3 referred to in the above section states:

 

Column I

Column II

Column III

Item

Particulars to Be Entered

Time of Entry

Person Responsible for Entry

3.

Air time of each flight or series of flights and cumulative total air time and, where applicable, number of operation cycles or landings since date of manufacture

Daily, on completion of each flight or series of flights

The pilot-in-command of the aircraft or a person designated by an air operator, a private operator or a flight training unit

Succinctly put, these sections provide that the person who has legal care and control of aircraft cannot permit the take-off and landing of the aircraft if it has not been maintained in accordance with the individual maintenance plan as detailed in the Small Operator Maintenance Control Manual for that aircraft as approved by the Department of Transport. The maintenance plan as approved by the Minister is compulsory and the only variations permitted are those specifically authorized by the Minister.

Because the integrity of the maintenance schedule, and therefore the airworthiness of the aircraft, is based solely on the accuracy of the cumulative air time or total air time (TAT), on the aircraft, any dereliction of the duty to record each and every flight and the corresponding air time would disrupt the maintenance schedule and render it impossible to follow. The impossibility of following the maintenance schedule for the aircraft violates its certificate of airworthiness and puts the safety of the aircraft and public in question.

In order to be successful in the prosecution of charge no.1, offence no.1, the Minister must show that, between August 1, 2003 and September 30, 2003, Sierra Fox Inc. having legal custody and control of aircraft C-FYTC permitted the aircraft to take off and be flown while not being maintained in accordance with its maintenance schedule and that this had occurred due to flights being undertaken and not recorded in the aircraft C-FYTC journey log book, causing the calculation of the TAT of aircraft C-FYTC to become inaccurate.

Violations of this provision would be proved, if, on a balance of probabilities, it was shown that the lack of entries in the journey log book distorted the actual air time or TAT the aircraft C-FYTC had flown. If entries were not made in the journey log book for flights the aircraft had made, maintenance schedules could not be maintained accurately and the operator would not know the TAT on the aircraft. It would be impossible to determine when the 50, 100, 500, or 1,000-hour inspections called for in the Small Operator Maintenance Control Manual had to be performed.

In order to be successful in the prosecution of charge no. 2, offence no.1, the Minister must show that between August 1, 2003 and September 30, 2003, aircraft C-FYTC made flights at the Muskoka Airport and Sierra Fox Inc. failed to record the air time or TAT in the aircraft journey log book, in accordance with particulars set out in Schedule I above.

Under paragraph 7.1(1)(b) of the Aeronautics Act the Minister may suspend, cancel, or refuse to renew a Canadian aviation document on the grounds that:

(b) the holder or any aircraft, airport or other facility in respect of which the document was issued ceases to meet the qualifications necessary for the issuance of the document or to fulfil the conditions subject to which the document was issued...

The certificate of airworthiness for aircraft C-FYTC has been suspended.

ISSUE

The question to be decided is whether there were flights conducted in aircraft C-FYTC between August 1, 2003 and September 30, 2003 which were not entered in the aircraft's journey log book.

The principal evidence in this case is documentary and contradictory. It boils down to deciding which of two documents is credible; the Daily Air Traffic Records (DATRs) for Muskoka Airport which indicate aircraft C-FYTC made numerous flights during August and September 2003 not recorded in the journey log book, or, the journey log book of the aircraft which does not show the alleged flights being made. There are no eye witnesses of the flights or corroborative evidence to support either document.

The case for the document holder is centred on the notion that the DATRs being relied on by the Minister for the period in question are not accurate, reliable or credible. The document holder maintains they should not be used to allege movements of aircraft C-FYTC. He states the journey log book is correct.

EVIDENCE

Sierra Fox Inc. is an air service company located in Gravenhurst, Ontario. It operates a flight training school at Muskoka Airport (CYQA) under the business name of Ferrari Flight Training. Sierra Fox Inc. is the registered owner of a Piper PA-28-140 (C-FYTC) aircraft used for flight training up to the period of suspension on October 31, 2003. Mr. Sandro Ferrari serves as the sole proprietor, maintenance and operations manager of Ferrari Flight Training and Sierra Fox Inc.

Mark Dixon is a Transport Canada civil aviation inspector in Ontario. His responsibilities include the inspection, monitoring, and supervision of a number of flight training schools in southern Ontario. He oversees flight testing practices at these schools and serves as the school's Transport Canada contact person. One of the schools he supervises is the Ferrari Flight Training school operated by Sierra Fox Inc. at Muskoka Airport.

Mr. Dixon, in his evidence, told the hearing about a conversation he had in August 2003 with another Transport Canada official, Mr. Ross Jackson, who was doing an operational audit of the flight operations at Ferrari Flight Training. Mr. Dixon said Mr. Jackson noticed that aircraft C-FYTC did not fly very much for a flight school training aircraft. Mr. Dixon said that Ferrari Flight Training had only one aircraft (C-FYTC), and that it was his estimate the aircraft had flown approximately 130 hours over the previous year. He said this figure was very low for a flight school operating only one aircraft. He felt, in such circumstances, 600 hours of flight training would be a moderate figure and 1,000 hours would be a high figure; 130 hours was very low and "abnormal" for a flight training unit (FTU).

Mr. Dixon said that upon hearing this comment, he decided to check the DATRs for the Muskoka Airport. The DATR is a Transport Canada document used by NAV CANADA officials to record aircraft movements at airports in Canada. He said that he happened to have copies of the DATRs for Muskoka Airport for a 10-day period in August 2003 on his desk.

The DATR purports to identify aircraft movements at an airport over the daily period that air traffic movements are monitored. This period extended to 24 hours a day for the Muskoka Airport. Mr. Dixon said that the DATRs showing aircraft movements at an airport would not be used to compute the airtime of an aircraft but that they would be useful in identifying discrepancies between aircraft movements and an aircraft journey log book. Mr. Dixon compared the DATRs for the 10-day period with the journey log book of the aircraft C-FYTC. There appeared to be discrepancies between these two documents as to the take-offs and landings of aircraft C-FYTC over that period.

Mr. Dixon decided to do a more extensive search and wanted to review the DATRs for the Muskoka Airport over a longer period. In October 2003, he visited the offices of the Muskoka Airport manager, Mr. Stephen Faulkner. Mr. Dixon obtained permission from Mr. Faulkner to review DATRs for the Muskoka Airport for August and September 2003. Mr. Dixon said these files revealed there were entries in the DATRs for movements involving aircraft C-FYTC. He received permission from Mr. Faulkner to copy these records on the airport photocopier located adjacent to Mr. Faulkner's office. Copies were made of the records for August and September 2003.

Mr. Dixon studied the records with his associate, Mr. Jackson, and found there were a number of occasions identified on the DATRs where aircraft C-FYTC had taken off or landed without a comparable entry in the journey log book of the aircraft. Their conclusion was that aircraft C-FYTC had flown more air time than what was identified in the aircraft's journey log book. Upon identifying these discrepancies, Mr. Dixon forwarded the file to Mr. David Bland, acting regional manager, aviation enforcement for the Ontario region of Transport Canada.

Ms. Tracy Kirkhus was the NAV CANADA site manager for the Toronto flight service station (FSS) housed in the Buttonville Airport Terminal Building located in Markham, Ontario. The Buttonville NAV CANADA facility using the remote aerodrome advisory service (RAAS) system was responsible for monitoring all aircraft movements at Muskoka Airport, and recording these movements on the DATR. DATRs are no longer used at Muskoka Airport because the airport has shifted to a new computer-based system.

The DATR is a form composed of three identical sheets in peel-off format. Entries are made by writing information on the top sheet. The reverse side of the top and second sheet are carbonised so that when the NAV CANADA flight service specialist fills in the top sheet, the impression his or her pen makes, produces an identical impression on the second and third sheets. The sheets separate into copies by simply peeling them apart.

Ms. Kirkhus explained that the Muskoka Airport (CYQA) does not have a control tower with a NAV CANADA flight service specialist onsite but that its air traffic and aviation weather advisory service was provided remotely by the Toronto FSS at Buttonville through the remote aerodrome advisory service (RAAS) system.

She explained that the Muskoka Airport has a mandatory frequency (MF), meaning all aircraft arriving at or departing from the airport are required, by regulation, to contact "Muskoka Radio", using the Muskoka Airport MF. Pilots are communicating with the NAV CANADA FSS located at Buttonville Airport. Arriving aircraft are required to contact "Muskoka Radio", 5 minutes before entering the Muskoka Airport zone set at 5 nautical miles from the airport and up to 3,900 feet ASL (above sea level). A NAV CANADA flight service specialist at Buttonville would monitor the Muskoka Airport radar screen and respond to all calls from aircraft approaching for landing, and all calls from aircraft about to enter the manoeuvring area (taxiways, runways, etc.) of the airport prior to departure. This service was transferred in late fall of 2003, to the NAV CANADA FSS in London, Ontario.

All aircraft movements identified as a result of the radio call would be registered on the Muskoka Airport DATR by the flight service specialist. Information recorded would include the aircraft identification, type of aircraft, airport arriving from or departing to, whether the aircraft is proceeding under VFR or IFR flight rules, and, finally, the runway to be used by the aircraft. The time of the call, in UTC (Zulu) time, would be registered immediately or very shortly after the call, and at least within 3 to 5 minutes of the call depending on the specialist's workload. The times noted as departure and arrival times would mostly be when the pilot reported. These times would be an approximation of the take-off and landing time. Ms. Kirkhus said flights were recorded in and out of Muskoka Airport in this fashion – "24/7".

Ms. Kirkhus indicated there are occasional discrepancies in the DATRs caused by workload or other operational considerations. She said, for example, manoeuvres called "stop and go's" are recorded individually but landings and take-offs during continuous circuits, touch and go's, are not. There may be occasions, such as the August 14, 2003 power blackout, when an aircraft movement is missed. However, she said such incidents would be limited. She accepted that arrival and departure times are approximate within a few minutes because of the time when the pilot calls into the system relative to the arrival and departure. It was her view that there would be very few omissions.

Ms. Kirkhus said that the DATR top sheet was sent by NAV CANADA to Transport Canada. After 30 days the top sheet was destroyed. The second sheet went to the airport manager and the third sheet went to Statistics Canada. The DATRs prepared in this case were recorded by one of 14 flight service specialists working under her supervision. Ms. Kirkhus examined the DATR sheets contained in Exhibits M-1 and M-2 and indicated they do not appear to have been altered in any material way.

Mr. Steve Faulkner, the Muskoka Airport manager, testified that he would receive fax copies of the DATRs from NAV CANADA on a daily basis. He would later receive at the end of the month the original daily copies for that month. The airport manager's copy, according to Mr. Faulkner, was used for three purposes; to monitor aircraft movements at the airport, to facilitate airport statistical analysis and to provide for the invoicing of landing fees.

Mr. Faulkner did not allow the original copies to be taken from his office except to have them photocopied in the airport photocopy room adjacent to his office. In October 2003, he complied with Mr. Dixon's request for the production of the DATRs for August and September 2003. Mr. Dixon photocopied the DATRs on the airport photocopier.

Mr. Faulkner stated access to these records was controlled, and, although he could not state with certainty, he was unaware of anyone else asking to see the DATRs for that period except Mr. Ferrari. He had no reason to believe they had been altered and there was no evidence any of the DATRs had been tampered with. Mr. Faulkner retained the original copies and brought them to the hearing.

Since one of the arguments of counsel for the document holder was that the photocopies of the DATRs admitted into evidence as Exhibits M-1 and M-2 contained discrepancies from the original copies retained in his possession, Mr. Faulkner was asked by the case presenting officer for the Minister to review, individually, 34 tabbed entries in the photocopies of the DATRs identified as Exhibits M-1 and M-2 to determine whether the entries varied to any material degree from the same entries on the original copies he retained in his possession. The Minister alleges that the 34 tabbed entries on Exhibits M-1 and M-2 indicate flights made by aircraft C-FYTC that were not entered in the journey log book of the aircraft.

Mr. Faulkner compared each one of the 34 tabbed entries and said for each entry there was no difference in data and that the entries on Exhibits M-1 and M-2 reflected exactly the entries on the original copy. He said it was the "same data".

During this exercise, supervised closely by counsel for the document holder, the only differences identified as occurring on the 34 entries between the photocopies of the DATRs prepared by Mr. Dixon and the original copies retained by Mr. Faulkner, were an occasional large asterisk placed beside an entry on the photocopy, other entries that had been highlighted, using a coloured highlighter, which showed up as being a light grey on the photocopy, and, finally, the absence on one of the second sheet copies of what appeared to be, in the photocopy, a small post-it note, annotated as "YQA Muskoka". This post-it note shows up on the photocopy of the DATR dated August 4, 2003. The post-it note appeared to have been placed on the document in order to identify the document as pertaining to the Muskoka Airport (CYQA).

I find that, in the case of the highlighted entries, the presence of the light grey colouring from the highlighter and the post-it note did not conceal any information on the Exhibits M-1 and M-2. Similarly, no asterisk on the photocopy concealed information. I also find that the 34 tabbed entries on the Exhibits M-1 and M-2 as photocopied by Mr. Dixon are identical in all material respects to the original copies of the DATRs of Muskoka Airport for the period August 1, 2003 to September 30, 2003 retained by Mr. Faulkner.

Mr. Randy Miller, a Transport Canada Civil aviation inspector and a certified aircraft maintenance engineer (AME), testified for the Minister. Mr. Miller's responsibilities include investigation of alleged manufacturing and maintenance violations of the CARs, maintenance provisions.

Mr. Miller explained that every air operator, in order to comply with the CARs, must scrupulously follow a Small Operator Maintenance Control Manual for each aircraft owned by the operator. This manual outlines the operator's maintenance responsibilities for that aircraft and the schedule that is required to be followed in order to maintain the certificate of airworthiness for the aircraft. Sierra Fox Inc. had a Small Operator Maintenance Control Manual stipulating the maintenance schedule to be followed for aircraft C-FYTC. A photocopy of the Small Operator Maintenance Control Manual for aircraft C-FYTC was admitted into evidence as Exhibit M-7.

The Small Operator Maintenance Control Manual is specific to the aircraft. For aircraft C-FYTC, it stipulated that the inspection cycle was to be based on intervals of 50, 100, 500, and 1,000 hours, with tolerances limited to +/- 5 hours for the 50-hour inspection and +/- 10 hours for the remaining inspections. The manual specified that it was applicable for an annual aircraft utilization of 100 hours to 1,000 hours. Mr. Miller indicated Sierra Fox Inc. had no exemptions from any of the maintenance requirements set out in the Small Operator Maintenance Control Manual for aircraft C-FYTC (Exhibit M-8).

The schedule of maintenance must be approved by Transport Canada, implemented and followed exactly, by the operator, within the allowable tolerances. The Manual is given an individual approval number and authorized by a Transport Canada official. Failure to follow the specified maintenance schedule in accordance with the schedule set out in the manual results in the certificate of airworthiness of the aircraft becoming invalid. If the schedule is not followed, Transport Canada will suspend the certificate of airworthiness and the aircraft will not be permitted to fly.

As required by the CARs, all flights and air time of the aircraft must be also entered in the journey log book so that the maintenance schedule, as set out in the Small Operator Maintenance Control Manual, can be executed according to the specified intervals. The journey log book is the only record which totals the amount of time the aircraft is in the air and determines when the required maintenance as set out in the manual must be performed. Proper entry of all flights in the journey log book is critical.

Mr. Miller, in cross-examination, offered a possible explanation as to why an operator would choose to not accurately report flights in the aircraft journey log book. He said if flying hours are not logged accurately in the journey log book, the TAT would not increase. Inspections cannot then be performed in accordance with the schedule set out in the manual. For the operator, the significant cost of the inspections is put off.

Mr. Miller indicated he was given the Sierra Fox Inc. file to investigate in October 2003. He reviewed the copies of the DATRs which he received from Mr. Dixon. He obtained the journey log book (photocopy Aug-Sep 2003 – Exhibit M-12) for aircraft C-FYTC from Mr. Ross Jackson. He compared the DATRs he obtained from Mr. Dixon for the period August 1, 2003 to September 30, 2003 with entries in the journey log book of aircraft C-FYTC, for the same period.

Mr. Miller stated that he found 34 entries for aircraft C-FYTC in the DATR of the Muskoka Airport for August and September 2003 for which there were no corresponding entries in the journey log book of aircraft C-FYTC. He said that while accurate computation of flight times or air times from the DATRs is not possible, he suggested that the cumulative airtime not recorded in the log book could total in this case to 20 or more hours. Mr. Miller said that flight schools are required to maintain, in addition to the journey log book for their aircraft, a daily flight record and other documentation that would more accurately show the air time of all flights.

Mr. Miller exchanged correspondence with Mr. Ferrari and subsequently met with him. He said that Mr. Ferrari indicated the journey log book was correct and that the DATRs contained inaccuracies and were therefore unreliable. During the meeting and subsequent correspondence, Mr. Ferrari offered no explanation of the discrepancies between the two documents nor did he offer any other documentation to substantiate his view that the entries in the journey log book for aircraft C-FYTC were correct. This remains his position.

Counsel for the document holder, during the cross-examination of Mr. Miller, pursued the notion that significant inaccuracies were contained in the DATRs. He pointed to five examples as justification for the premise that the DATRs were unreliable and cannot be used to substantiate the allegations of the Minister. He referred the hearing to entries for August 10, August 17, August 20, August 31, and September 7, 2003 in Exhibits M-1 and M-2. Each of these alleged inaccuracies must be reviewed to determine their impact on the credibility of the two exhibits.

An entry on the DATR for August 10, 2003 indicates an arrival for aircraft C-FYTC, after a local flight, at 0038 UTC. There is a departure on the August 9, 2003 DATR at 2357 UTC. This would have been a 42-minute flight. There are two other flights in the DATR for that day; one departing at 1323 UTC on a local northwest flight returning at 1350 UTC, with another departure at 1712 UTC.

Counsel for the document holder suggested that there was no arrival time shown on the DATR for the flight departing at 1712 UTC. The DATR, however, does show an arrival for C-FYTC at 1942 UTC. If counsel's argument was followed, that the 1712 flight shows no arrival, it follows that the arrival at 1942 UTC would not have had a departure. If this were the case, aircraft C-FYTC would have had two movements (an arrival and departure) which would not have been logged in the DATR for that day. This, it would seem to me, would be improbable. The DATR shows two flights with both arrivals and departures. Counsel for the document holder did not contest or choose to cross-examine the witness on the other flights in the DATRs on that date. In any event, a review of the journey log book (Exhibit M-12) for aircraft C-FYTC for August 10, 2003 indicates there were no flights conducted by C-FYTC on that date. It thus appears as if there were two flights omitted from the journey log book.

Counsel for the document holder noted that the DATR for August 17, 2003 had two aircraft, C-FYTC and C-FLDC, departing YQA at 2051 UTC; the inference being that two aircraft cannot depart the same airport at the same time or indeed within a minute of one another. The inference being that the DATR is inaccurate and cannot be relied upon. The response to this argument is that two small aircraft can depart the same runway within 60 seconds of one another and in high traffic density airports frequently do. This would not be the case where a small aircraft is following a large aircraft because the possibility of wake turbulence would force a delay of 2-3 minutes between departures. But, wake turbulence is a far less concern for departures of two small aircraft. Secondly, the evidence of Ms. Kirkhus was to the effect that the arrival and departure times as entered on the DATRs may reflect when the aircraft call was made to "Muskoka Radio" and not necessarily the actual take-off and landing times of the aircraft. As a result and without any evidence to the contrary, no great significance can be attached to the fact two aircraft were entered in the DATRs as taking off in the same 60-second time frame. It should be pointed out that there was no entry in the journey log book for aircraft C-FYTC for August 17, 2003. It is also to be noted that counsel for the document holder did not suggest that the flight of C-FYTC as noted in that DATR was never made.

Counsel for the document holder cited the DATR for August 20, 2003 which indicated a flight by C-FYTC departing at 1732 UTC and arriving at 1814 UTC giving an air time of 42 minutes or 0.7 hours. He pointed out that the journey log book entry for that same flight was 1.3 hours air time and 1.9 hours flight time. The result is that there are two documents suggesting different information. The Minister had no additional information and the document holder introduced no evidence to corroborate his version of the entries in journey log book. It is therefore difficult to determine which of the two is accurate. In any event, it is of little relevance because, although the two entries varied, there is no dispute that aircraft C-FYTC flew at the time in question. This entry did not form part of the 34 tabbed entries in Exhibits M-1 and M-2 which are the subject of the alleged violations.

The entries for August 31, 2003 in the DATRs show nine flights for aircraft C-FYTC totalling 3.0 hours air time. Six of the flights appear to be "stop and go" circuits which as Ms. Kirkhus pointed out are entered individually as flights. The remaining three flights could have been circuits ("touch and go") in which only the total elapsed time of the session is recorded. The entry in the C-FYTC journey log book for that date indicates two flights ending at 1755 Zulu showing a total air time of 1.4 hours with a flight time of 2.0 hours. Once again, the two records vary. No corroborative evidence was introduced on the part of either party which could question the other's version. Mr. Miller stated that Sierra Fox Inc. would have additional documentation such as the daily flight record required to be maintained by the operator by section 406.56 of the CARs, which could have been used to corroborate the journey log book. He said Sierra Fox Inc. chose not to provide this information. Once again, these entries do not form part of the 34 tabbed entries in Exhibits M-1 and M-2 identifying the alleged violations.

Finally, September 7, 2003 was highlighted by counsel for the document holder as a date of an entry in the journey log book of aircraft C-FYTC with no corresponding entry in the DATRs. No explanation was offered by either party and no corroborative documentation was offered by the document holder to lend support to the position taken by him that there had been a flight.

The case presenting officer for the Minister called Mr. Ross Jackson, an inspector for Transport Canada for 18 years. Mr. Jackson was the investigator who issued the Notice of Suspension of the certificate of airworthiness and Notice of Detention of the aircraft. It is not necessary to review Mr. Jackson's testimony in any detail. Suffice it to say, he was involved in the analysis of the alleged failures to record the flights in the journey log book and his testimony corroborates the material points contained in the testimony of Mr. Dixon and Mr. Miller.

Counsel for the document holder called as his only witness, Mr. Claude Radley. Mr. Radley has been a flight service specialist since 1970. He is currently on sick leave but worked the Muskoka FSS for 18 years. He worked for a brief period of time as a training officer at the Toronto FSS at Buttonville and is now an instructor. He is currently posted to the Flight Information Centre in London, Ontario. Mr. Radley has never held any permanent managerial positions with NAV CANADA although he has done so in an acting capacity at various points in his career.

Mr. Radley stated he has filled out thousands of DATRs. He indicated they were a low priority item, but his responsibility was to complete the documents as set out in the NAV CANADA Manual of Operations. He said that the initial information received from the pilot is put on air traffic control (ATC) "strips" and then transferred to the DATRs when time permits. His testimony was that the accuracy of the DATRs was "questionable at best". He said they were often subject to "padding". He explained "padding" as being false or erroneous entries in the DATRs made by a flight service specialist to inflate workload. This is done to justify his or her position in order to maintain staffing levels and keep their job. He cited the St. Catherines Airport as an example where this practice had taken place. He also said padding took place at Muskoka Airport FSS while he worked there until 1996 when it was closed and the service transferred to Buttonville. He pointed out that the DATR for Muskoka Airport for September 6, 2003 identified 56 aircraft movements with the comment, "if they actually occurred this is incredible". He surmised this was evidence of padding.

In cross-examination, Mr. Radley stated he had never padded any DATRs over his 34 years of service. He said he was not working at Buttonville during the period of August to September 2003. He also said that he has no knowledge that any of the entries identified in Exhibits M-1 and M-2 were padded. In contradiction with his testimony on direct, he stated that Muskoka Airport was a busy airport, and, insofar as the movements identified on the DATR for September 9, 2003 are concerned, it is possible those flights took place with no padding involved.

Mr. Radley's testimony raises the issue of whether any of the entries in the DATRs for August and September 2003 were falsified. There is no evidence before me, from Mr. Radley or anyone else, that any entries in Exhibits M-1 and M-2 were the subject of padding or falsification. Accordingly, I find as a fact they were not padded or falsified.

All witnesses agreed that, for various reasons, DATRs cannot be used to determine air times. I accept, for the purposes of these matters, airtime and therefore TAT cannot be accurately determined from analysis of the DATRs.

Best Evidence Rule

Counsel for the document holder framed part of his argument around the "best evidence rule". He said that Exhibits M-1 and M-2 are photocopies and should not be accorded any value or weight because they were not certified true copies, no specific authors have been or are identified, and the originals are not available. He said the photocopies of documents being introduced into evidence were unreliable and that certified copies or the originals were to be preferred. It may be pointed out, in passing, that all exhibits admitted into evidence were photocopies.

Mr. Dixon's and Mr. Faulkner's evidence confirm that Exhibit M-1 and M-2 are photocopies of the original copies of the DATRs for the period in question. They have been signed by the proper officer of Transport Canada, Mr. Dixon. As well, the 34 tabbed entries on the photocopied exhibits match, in all material respects, the original second sheet copies received from NAV CANADA by Mr. Faulkner, who retained the original copies in his possession and brought by him to the hearing.

The value of the "best evidence rule" has been described as follows:

The best evidence rule is greatly reduced in importance in the technology-driven, contemporary world of faxes, photocopiers, e-mails and electronic recordings.[1]

As justification for this conclusion, the author cites Pigeon J. in the R. v. Cotroni[2] where he quoted Jessup J.A. in the Ontario Court of Appeal with approval:

Of the 'best evidence' rule Halsbury states in the 4th ed., Vol 17, p. 8:

That evidence should be the best that the nature of the case will allow is, besides being a matter of obvious prudence, a principle with a considerable pedigree. However, any strict interpretation of this principle has long been obsolete, and the rule is now only of importance in regard to the primary evidence of private documents. (Emphasis added)

Jessup J.A. also refers to the decision of Lord Denning M.R. in the case of Garton v. Hunter[3] where he states:

It is plain that Scott, L.J. had in mind the old rule that a party must produce the best evidence that the nature of the case will allow, and that any less good evidence is to be excluded. That old rule has gone by the board long ago... Nowadays we do not confine ourselves to the best evidence. We admit all relevant evidence. The goodness or badness of it goes only to weight, and not to admissibility.

In addition to the above, subsection 26(1) of the Canada Evidence Act, for the purpose of this hearing, provides that certified copies of these records can be admitted into evidence. I therefore conclude that Exhibits M-1 and M-2 are admissible and may be accorded the appropriate weight due in the circumstances.

Corroborating evidence and enforcement

Counsel for the document holder argued the DATRs should not be used for enforcement purposes and that it was necessary, if they are to be used for enforcement, to have corroborating evidence to support the entries. He submitted that the case of Dolphin v. MoT[4] suggests that reliance on the DATRs alone is not enough and that corroborating evidence of the flights was necessary.

The Dolphin case had to do with evidence presented at the hearing that had been altered; i.e., original ATC audio tapes being compressed for presentation at the hearing. That case differs from this one, in that the DATRs in this case, had not been altered in any material respect and are certified copies of the original copy. Indeed, Mr. Faulkner testified it was "the same data". It would follow that the need for corroborating evidence is not present. In such circumstances, it is my view that, on this point, the Dolphin case is not relevant.

Counsel also cited MoT v. Pizzardi[5] as authority for the need for corroborating evidence and that the DATR should not be used for enforcement purposes. This case involved an allegation of 17 flights conducted but not entered in the journey log book. While it is true some of these flights were proved by entries in the DATRs and corroborated by other evidence such as fuel receipts or eye witnesses, there was an additional four flights discussed at pages 12 and 13 of the review determination where the hearing officer relied solely on the DATRs for evidence that the flights were made. There is no mention of any corroborative evidence for any of these four flights. The hearing officer accepted the testimony of the flight service specialist relative to the information contained in the DATRs, notwithstanding minor errors in some of the entries.

Without additional evidence, the hearing officer found the alleged flights occurred as identified in the DATRs. He also accepted that DATRs can provide evidence of flights notwithstanding the presence of errors and that they were prepared by someone not called as a witness. On the appeal,[6] the Tribunal, while accepting there were errors in the records, also noted that the witness (a FSS supervisor) did not personally make the entries in the DATRs, did not see the aircraft when they called in, and was acting in a supervisory role at the time of the alleged infraction. The panel agreed with the conclusions of the hearing officer that the errors were not material and upheld the hearing officer's determination.

Counsel for the document holder also cited the case Alta Flights v. MoT.[7] This case involved a significant number of flights made on different aircraft and allegedly not recorded in the journey log books. The hearing officer considered the DATRs for Vancouver and Calgary International Airports and Edmonton Municipal Airport as presented in evidence by various supervisors of those operations. After considering the potential for accuracy, he states at page 3:

I have given careful consideration to counsel's objection [of the introduction into evidence of the DATRs and their accuracy], however, taking into account the relevance of the records and the potential for unreliability and balancing these considerations in relation to fairness of the parties, I have admitted the Daily Air Traffic Records and have given considerable weight to them in arriving at my decision.

The hearing officer also dismissed the notion that DATRs cannot be considered in evidence because they amount to hearsay. He states at page 3:

Proceedings before the Tribunal, however, are dealt with as expeditiously and informally as the circumstances and considerations of fairness permit. The nature of this evidence does not demand direct personal knowledge of the event.

The issue of hearsay also surfaced in the case of High Country Fishing v. MoT.[8] In that case six flights were not logged in the journey log book of the aircraft. Counsel for the Appellant urged the panel to exclude the DATRs and other official records from consideration.

The appeal Tribunal considered the issue of hearsay and while stating at page 7 that "The Tribunal is not bound by any legal or technical rules of evidence" quoted extensively from the case of MoT v. Malcolm Edward McIvor,[9] where the issue of hearsay was discussed. It concluded the hearsay may be accepted into evidence if "its introduction would [not] infringe procedural fairness and natural justice". The Tribunal went on to conclude:

There is nothing in the evidence to suggest that any of these exhibits do not correctly reflect the entries made therein. To require that Transport call the author of the document would, in the absence of evidence that it may be incorrect, put the process to unnecessary expense. We conclude, therefore, that the introduction of Exhibits M1, M3, M4, M5, M6, and M7 and the viva voce evidence in relation thereto does not infringe, in this case, on procedural fairness or natural justice.

Exhibits M-5, M-6 and M-7 were the DATRs.

It should be noted that in each of these cases, the DATRs were used and accepted by the Tribunal for enforcement purposes. I therefore accept for the purposes of these matters that certified copies of the original copies of the DATRs may be admitted into evidence and used for enforcement purposes without corroboration. I also accept that the DATRs are admissible notwithstanding the preoccupations of the document holder with hearsay. In view of the fact the document holder has had every opportunity to address and deal with the exhibits and viva voce evidence presented in this case, I am satisfied the admissibility of the DATRs does not infringe on procedural fairness or natural justice.

Burden of Proof

Counsel for the document holder submitted that the Minister by using the DATRs alone has not discharged the burden of proof upon him. Therefore, the burden of proof has not shifted to the document holder. He does not need to respond.

In May of 1978 the Supreme Court of Canada in the case of R. v. Sault Ste. Marie[10] clarified the categories of offences in Canada and what must be proved for each category. The court stated that among the three kinds of offences that should be recognized in Canada were those involving strict liability. Mr. Justice Dickson stated:

Offences in which there is no necessity for the prosecution to prove the existence of mens rea; the doing of the prohibited act prima facie imports the offence, leaving it open to the accused to avoid liability by proving that he took all reasonable care. This involves consideration of what a reasonable man would have done in the circumstances. The defence will be available if the accused reasonably believed in a mistaken set of facts which, if true, would render the act or omission innocent, or if he took all reasonable steps to avoid the particular event. These offences may properly be called offences of strict liability.

Most regulatory offences are of the strict liability type. It is not necessary for the Crown to prove mens rea, i.e., the guilty mind or intention to commit the offence. The Crown need only prove the actus reus and upon doing so the evidentiary burden then shifts to the alleged offender to prove that he took all reasonable care. In this regard, section 8.5 of the Aeronautics Act specifically states that it will be a good defence to a contravention of a provision of the Aeronautics Act or the CARs, if the alleged offender can show he exercised all due diligence to prevent the contravention. This has been interpreted to mean that the document holder can offer some explanation as to how the flights were not made or recorded.

In Pizzardi and Doyle v. MoT,[11], the appeal Tribunal stated at page 5 of the report:

Paragraphs7.9(5)(a) and (b) of the Aeronautics Act make it quite clear that the burden of proving the elements of each of the alleged contraventions rests with the Minister of Transport, and that the Appellants need not give any evidence or testimony. Once the Minister of Transport has provided evidence and made its case, the evidentiary burden shifts in these as in all strict liability offences to the Appellants who must prove on a balance of probabilities that they have exercised all due diligence to prevent the commission of the offences as alleged or proof of any exception or defence as applies in the circumstances of the case.

DETERMINATION

I have, for the reasons indicated, admitted the DATRs into evidence. Counsel for the document holder did not contest or cross-examine any witnesses in relation to the 34 tabbed entries in Exhibits M-1 and M-2 alleged by the Minister to be flights of aircraft C-FYTC. Their value as to the 34 tabbed entries has not been impeached. Other than the journey log book, there was no corroborative evidence introduced by the document holder to show those flights were not conducted or to call that information into question. The document holder has not provided any evidence of due diligence or the applicability of any exceptions or defences as provided for in section 8.5 of the Aeronautics Act.

I conclude on the evidence before me that the flights identified in the DATRs, as conducted in aircraft C-FYTC, did take place. I also conclude there were no corresponding entries recorded in the journey log book for the 34 flights tabbed in Exhibits M-1 and M-2. I therefore find that Sierra Fox Inc. violated subsection 605.94(1) of the CARs on 34 occasions. I also find that Sierra Fox Inc. violated paragraph 605.86(1)(b) of the CARs in that it allowed aircraft C-FYTC to be flown when the aircraft had not been maintained in accordance with its approved maintenance schedule.

I therefore find the Notice of Suspension of the certificate of airworthiness of aircraft C-FYTC and the Notice of Assessment of Monetary Penalty under paragraph 7.1(1)(b) and section 7.7 of the Aeronautics Act, respectively, were appropriate measures in the circumstances.

Penalty

The failure to record flights in the journey log book of an aircraft is a serious matter and directly impacts the maintenance and airworthiness of the aircraft. It puts the personal safety of the pilot, passengers and, in this case, students in jeopardy. In my view, a flight training unit has a special obligation to protect the public and its students as well as a responsibility to teach students to respect and follow regulations and procedures scrupulously. A flight training unit must not only set an example for its students but be also seen to set an example for its students and the public in general.

The facts of this case show repeated violations over the two-month period. The penalty must be fair but it must also communicate to the document holder, the public, and the aviation community in general a denunciation of the practice that led to the violations. There must also be a deterrent factor communicating the message that this practice must not continue.

I am persuaded that the monetary penalties assessed in this case are appropriate and should be maintained as set out in the Notice of Assessment of Monetary Penalty dated March 22, 2004.

Both parties addressed the issue of costs. There will be no order as to costs.

James E. Lockyer
Member
Transportation Appeal Tribunal of Canada


[1] M.P. Doherty, The Portable Guide to Evidence (Toronto: Carswell, 2001) at 90.

[2] [1979] 2 S.C.R.256, 263-264.

[3] (1969) 2 Q.B. 37, at 44.

[4] Leslie James Dolphin v. Minister of Transport, [1990] CAT File No. C-0133-02 (appeal).

[5] Minister of Transport v. Richard Pizzardi and Donald Doyle, [1996] CAT File No. O-0494-37.

[6] Richard Pizzardi & Donald Doyle v. Minister of Transport, [1996] CAT File No. O-0494-37 (appeal).

[7] Alta Flights (Charters) Ltd. v. Minister of Transport, [1990] CAT File No. W-0098-10.

[8] High Country Fishing Ltd. v. Minister of Transport, [1992] CAT File No. W-0143-37 (appeal).

[9] Minister of Transport v. Malcolm Edward McIvor, [1991] CAT File No. C-0135-33 (appeal).

[10] [1978] 2 S.C.R. 1299.

[11] In Pizzardi and Doyle, supra, note 6.


Appeal decision
Allister W. Ogilvie, Frank Morgan, William H. Fellows


Decision: March 31, 2005

The appeal is allowed. The suspension of the certificate of airworthiness for aircraft C-FYTC is referred back to the Minister for reconsideration.

An appeal hearing on this matter was held Friday, January 21, 2005 at the Sheraton Gateway Hotel, in Toronto, Ontario at 10:00 hours.

BACKGROUND

During a routine maintenance audit of Sierra Fox Inc., a flight training company based in Muskoka, a Transport Canada inspector noticed that the aircraft seemed to have a low air time for a flight training aircraft. He and one of his colleagues compared the number of flights listed in the aircraft journey log book to the Daily Air Traffic Records (DATRs) for the Muskoka Airport. The journey log book is a document that is required to be kept for an aircraft in which, among other items, the actual air times flown are to be recorded. The latter document is a written record of local air traffic movements for a particular airport. The DATRs had recorded aircraft movements for Sierra Fox's aircraft, C-FYTC (YTC), which were not listed in the journey log book.

A further investigation ensued. The inspectors then compared the entries in the journey log book to the Muskoka DATRs for the period between August 1 and September 30, 2003. Their observation of numerous discrepancies between the two records led them to conclude that aircraft YTC had flown on numerous occasions but that the flight times had not been recorded in the journey log book.

Allegations

The Minister opened two files in the matter.

1) Pursuant to section 7.7 of the Aeronautics Act:

Charge 1: The Minister alleged that Sierra Fox had contravened subsection 605.86(1) of the Canadian Aviation Regulations (CARs). Between August 1 and September 30, 2003, it had permitted take-offs to be conducted in YTC, an aircraft in its custody and control, when the aircraft had not been maintained in accordance with its approved maintenance schedule. Flights conducted but not recorded caused the calculation of the total air time of the aircraft to be inaccurate. Penalty assessed at $1,250.00.

Charge 2: During the time period in question Sierra Fox operated YTC on several flights at or near Muskoka and failed to record the air time or the cumulative total air time in the aircraft journey log book in accordance with the particulars set out in the regulations, thereby violating subsection 605.94(1) of the CARs. Penalty assessed at $500.00.

2) Pursuant to paragraph 7.1(1)(b) of the Aeronautics Act:

The Minister suspended the certificate of airworthiness of YTC on the grounds that the aircraft did not comply with the conditions subject to which the document was issued in that the aircraft had not been maintained in accordance with the approved maintenance schedule. Flights flown but not recorded in the log book rendered the calculation of total air time inaccurate.

Review Hearing

These files were heard together before a single Tribunal Member on June 16 and July 14, 2004 in Barrie, Ontario. In the first file he found that Sierra Fox did contravene subsections 605.86(1) and 605.94(1) of the CARs and upheld the monetary penalty.

In the second he confirmed the suspension of the certificate of airworthiness of the aircraft.

THE APPEAL

Sierra Fox was not satisfied with the review determination and filed an appeal. The appeal hearing was heard before a three-member panel of the Tribunal on January 21, 2005 in Toronto, Ontario.

The grounds of the appeal are as follows:

1. The Tribunal erred in admitting as evidence and relying on Daily Air Traffic Records prepared by Nav Canada for the following reasons:

i. The copies of the Daily Air Traffic Records admitted as Exhibits M-1 and M-2, were not certified true copies and were not the same as the Daily Air Traffic Records disclosed to the document holder prior to the hearing. The evidence at the hearing established that Exhibit M-1 and M-2 were not certified true copies of originals, or certified true copies of copies;

ii. The Tribunal erred in finding as fact that the alterations and notes made on the Daily Air Traffic Records submitted as Exhibit M-1 and M-2 did not obscure any information, although a post-it note on one of the copies covered information relating to the aircraft in issue at the hearing;

iii. There were serious issues with respect to the accuracy and authenticity of the Daily Air Traffic Records such that procedural fairness and natural justice required that the author of the documents be required to attend the hearing to authenticate the documents and submit to cross-examination, or be identified to the document holder prior to the hearing;

iv. The Daily Air Traffic Records were held to be a certified true copy of the original, although the evidence established that no witness who testified had seen the original documents;

v. The evidence established that the primary evidence of Nav Canada were the "strips" on which data is recorded, although no "strips" were admitted in evidence;

2. The Tribunal Member erred in law by shifting the onus and evidentiary burden to the document holder to prove that the Journey Log Book was accurate, and in finding that the Daily Air Traffic Records are proof of the truth of their contents in the absence of the document holder providing evidence to corroborate the accuracy of the Journey Log Book;

3. The Tribunal Member erred in law by shifting the onus and evidentiary burden to the document holder in finding that the document holder did not adduce any evidence of "padding" or falsification of the Daily Air Traffic Records contained in Exhibit M-1 and M-2, although the Minister failed to produce the author of those documents as a witness, or identify the author of the documents. The document holder was not given the opportunity to cross-examine the author of the document on this issue as he or she was not produced as a witness;

4. In holding that the Daily Air Traffic Records are proof of the truth of their contents, the Tribunal Member failed to account for or make findings with respect to flights recorded in the Journey Log Book but not in the Daily Air Traffic Records;

5. The Tribunal Member erred in law by shifting the onus and burden of proof to the document holder to provide evidence and corroboration that the Journey Log Book was accurate, and in the absence that corroboration found the Daily Air Traffic Records to be accurate and admissible for the truth of their contents;

6. The Tribunal Member erred in his application of the rules of evidence and chose to accept hearsay despite clear contradiction from witnesses;

7. The Tribunal Member failed to adhere to procedural rules, natural justice and procedural fairness during the hearing;

8. The Tribunal Member misapprehended the evidence and facts throughout his decision, including but not limited to the following findings:

i.) The decisions make findings of fact on which no evidence was adduced with respect to turbulence and the capacity for two aircraft to depart at the same time or within a minute of one another;

ii) The decision findings of fact with respect to issues on which no witness testified, and makes findings of fact that were not supportable in evidence.

9. The Tribunal Member failed to properly address the evidence of Mr. Ross Jackson and never referred it the issues of credibility, and erred in finding that Mr. Jackson's testimony corroborated the evidence given by other witnesses;

10. The Tribunal Member erred in failing to make a determination as to the admissibility of the purportedly certified true copy of the Journey Log Book following Mr. Jackson's evidence that he could not have copied and certified the documents on October 14th, when there were entries in the documents dated October 15th;

11. The Tribunal Member made errors of law with respect to the application of the best evidence rule and necessity for corroborating evidence on behalf of the Minister; and,

12. Such further grounds as may be raised at the hearing of this appeal.

Submissions of the parties

Both parties provided extensive arguments on all issues brought into question by the grounds of appeal. For reasons stated below we have summarized their main points only on the issues of admissibility and reliability.

Appellant

Mr. Fairlie's presentation on behalf of Sierra fox Inc. centered on questions of admissibility and reliability of the Minister's evidence and witness testimony respecting DATRs (Exhibits M-1 and M-2 at the review hearing). Mr. Fairlie gave reasons why the review hearing did not properly address that evidence and the testimony on the basis of fact:

  • Exhibits M-1 and M-2 were not reliable and should not have been admitted.
  • Author of the DATRs was not identified.
  • Exhibits M-1 and M-2 were not certified true copies of DATRs.
  • Onus of proof was shifted to Sierra Fox to show the journey log as accurate.

He requested that the Notice of Assessment of Monetary Penalty be set aside and that the suspension of the certificate of airworthiness for aircraft YTC be sent back to the Minister for reconsideration.

Minister of Transport

Mr. Villemure presented arguments on behalf of the Minister. He first submitted that findings of fact should not be overturned on appeal unless they are unreasonable. The Member at review did not err when admitting and then relying upon the DATRs to find that flights had taken place because the evidence accepted, Exhibits M-1 and M-2, showed that 34 take-offs and landings by aircraft YTC had taken place but were not entered in the journey log. He submits that the appeal be dismissed.

Issue

The issue in this appeal is whether the Member erred in his finding that uncorroborated hearsay evidence was sufficient to establish a violation.

Held

We find that the Member erred in law in accepting uncorroborated hearsay evidence as the sole proof of an alleged violation. We allow the appeal.

Having allowed the appeal on that ground we do not find it necessary to address the other grounds filed.

DISCUSSION

The Member considered the appellant's proposition that it is necessary to have corroborating evidence to support the DATRs entries if those entries are being used for enforcement purposes. He concluded that for the purposes of this case certified copies of the original copies of DATRs may be admitted into evidence and used for enforcement purposes without corroboration.

We agree that the DATRs are admissible as evidence but disagree with the proposition that they may be used without corroboration. We hold that it is an error of law to accept uncorroborated hearsay evidence as the sole source of evidence to uphold an allegation.

Admissibility

The grounds of appeal assert, in part, that it was an error to admit and rely upon the DATRs prepared by NAV CANADA because of their hearsay nature (grounds 1, 2, 4, and 5 - transcript, pages 26-27). We find that the admission of the DATRs was not an error although we come to that conclusion on a basis that differs from the Member.

In the decision, the Member found that subsection 26(1) of the Canada Evidence Act would allow the introduction of the records. From the section's wording it is restricted to entries in books kept: "... in any office or department of the Government of Canada, or in any commission, board or other branch of the public service of Canada...". A flight service specialist in the employ of NAV CANADA created the entries. As NAV CANADA is a private corporation, section 26 is inapplicable to it. The evidence as we understand it is that NAV CANADA personnel made the entries to create the document. One copy was forwarded to the Muskoka Airport, one to Statistics Canada and one was utilized by NAV CANADA (transcript, pages 92-95). The sheets themselves bear Transport Canada's name but Ms. Kirkhus explained that NAV CANADA normally used their own NAV CANADA Aircraft Movement Statistics (NCAMS) report, an electronic system, but that system was not operational in Buttonville. Therefore, they continued to use the old Transport Canada forms.

If we have misapprehended that evidence we still find that subsection 26(1) is inapplicable as it states in part:

26(1) A copy of any entry in any book kept in any office...of the government of Canada...shall be admitted as evidence of that entry...if it is proved by the oath or affidavit of an officer of the office or department...(emphasis added)
[...]

The record before us does not show any oath or affidavit to that effect.

It was the hearsay nature of the DATR's evidence that grounded the objection to admissibility (transcript, pages 26-27). However, even in court settings where the legal and technical rules of evidence are more strictly enforced, the courts have adopted a more flexible approach to such evidence based on necessity and reliability.[1]

The rule against the admittance of hearsay is a prime example of one of the legal and technical rules of evidence. The Tribunal is relieved of the legal and technical rules of evidence by the operation of section 15 of the Transportation Appeal Tribunal of Canada Act (TATC). Being relieved of the legal and technical rules of evidence does not mean that no rules apply. It has been recognized that the basic criterion for the admissibility of evidence in an administrative setting is relevance.[2]

Exhibits M-1 and M-2, the DATRs, are hearsay as they are written statements made by persons otherwise than in testimony at the proceeding in which they are offered as proof of the truth of their contents.[3] They are relevant because, if true, they would go to establishing the factual basis upon which the contravention could be found. Therefore, we find that they are admissible as relevant evidence.

Reliability- Corroboration

But not all relevant evidence is of equal probative value. The Member reviewed the jurisprudence submitted at the review hearing. From it he concluded that the DATRs, when admitted into evidence, may be used without corroboration.

With respect, our conclusion upon review of those cases and other Tribunal jurisprudence, as well as the TATC Act, draws us to a contrary conclusion.

Jurisprudence reviewed at review

We concur that the Dolphin case[4] is not relevant to the point in this issue. The Member next addressed MoT v. Pizzardi.[5] The case involved allegations of flights flown but not recorded (former regulation 826). DATRs data was used as proof of the flights made. Of the eleven allegations heard, all but four were proved using corroborative evidence to supplement the DATRs. Eye witness testimony and documentary evidence such as fuel receipts were utilized. Four flights were found to be contraventions based on the evidence contained in the DATRs alone. However, the hearing officer's acceptance of uncorroborated evidence was not accompanied by any analysis or reasoning.

We are left with findings of eight contraventions wherein corroborative evidence was given and four where DATRs alone were relied upon. We do not feel that the case stands for the acceptance of uncorroborated hearsay evidence, especially in light of other jurisprudence which suggests that it should not be accepted (jurisprudence discussed below).

We do note that upon appeal the hearing officer's findings were upheld.[6] However, the grounds of appeal did not include an allegation of error as regards uncorroborated hearsay evidence; hence it was not addressed at the appeal.

The Member next addressed Alta Flights v. MoT.[7] That case also alleged that numerous flights were flown but not recorded in the journey log book (former regulation 826). In that instance the hearing officer found the DATRs to be admissible and accorded them considerable weight.

However, following the passage regarding accuracy of the documents, the hearing officer in Alta Flights stated that Transport Canada also introduced into evidence "Transport Canada Daily Air Traffic Record - Itinerant Movements" obtained from Statistics Canada, saying that those records corroborate the evidence contained in the DATRs from Vancouver, Calgary and Edmonton.

Transport Canada also introduced Master Card fuel slips for some flights in question, which further confirms that in those instances, the aircraft made the alleged flight. Given that corroborative evidence was utilized for confirmation of the contents of the DATRs, we do not see that this case stands for its use in an uncorroborated manner.

The Member also addressed hearsay in the context of the case of High Country Fishing v. MoT[8]

(at appeal). It too involved the allegation of flights flown but corresponding air times not being recorded (former regulation 826). Control tower records and Flight Service Station DATRs were compared to journey log book entries. It was argued that the DATRs could not be considered because no proper basis had been established for their introduction.

The appeal panel in considering the introduction of hearsay evidence quoted extensively from the decision in MoT v. McIvor.[9] The member in this case relies upon those findings to substantiate his position. However, we read the McIvor decision as being primarily addressed to the actual admittance or introduction of hearsay evidence. This is illustrated by the words of the panel in High Country when introducing the McIvor reasoning as they stated, "Introduction of "hearsay" evidence was dealt with at some length at the Appeal level...". At the review level hearing in McIvor, the hearing officer found the hearsay evidence of one witness regarding dip stick fuel level readings was inadmissable. That decision was upheld at appeal. That illustrates that the focus of the appeal was on the admissibility of the evidence rather than its reliability or weight.

The McIvor and High Country cases were decided in 1991 and 1992. Tribunal jurisprudence since that time has relaxed the admission of hearsay evidence somewhat more as was discussed in the Admissibility section above.

As well, we note that the quotation relied upon by the member states that: "There is nothing in the evidence to suggest that any of these exhibits do not correctly reflect the entries made therein." That is in contradistinction to the Sierra Fox case where Mr. Radley's testimony impugned the accuracy of the DATRs in general, and the journey log book differed from the data in the DATRs. However, the McIvor appeal panel's findings, in its totality, is instructive on the issue at hand. The panel in McIvor dealt with the introduction of hearsay evidence, upholding the review determination that it was inadmissible. They also opine on hearsay's kind and quality if it were to be admitted.

The panel declared:

There may be instances in which procedural fairness and natural justice would allow some forms of hearsay evidence to be introduced as proof of its truth. A hearing officer in each case must make that determination. Generally speaking however, if hearsay evidence is admitted, it should be received only as evidence that a statement was made and not as proof of its truth. If the hearing officer determines that procedural fairness and natural justice would be offended by the introduction of hearsay evidence, then the facts narrated must be given through the testimony of the person making the statement. (emphasis added)

The panel expressed reasons why hearsay should not be admitted. They stated:

Hearsay as such is fraught with untrustworthiness, the author is not under oath and is not subject to cross examination, accuracy deteriorates with repetition and hearsay is secondary and therefore, weaker evidence.

Other jurisprudence

An analysis of hearsay evidence and its use in the Tribunal setting was undertaken in the Rowan case.[10] There it was alleged that a pilot did not comply with an air traffic control clearance. Evidence adduced as to one element of the offence was uncorroborated hearsay. The Member found that he could not accord that evidence any weight and therefore dismissed the allegation. In doing so he stated: "Hearsay evidence can be of value, especially if verified or corroborated by other evidence or if it forms the corroboration of some other evidence."

North East Air Services[11] was similar in nature to Sierra Fox in that it was alleged that there were flights flown but not entered in a journey log book (former regulation 826). Twenty allegations were made, ten pertaining to each of two aircraft. Evidence adduced to prove that the flights had taken place included aircraft movement records, similar to DATRs. The nature of the evidence was addressed (pages 13-14):

The record was entered as Exhibit M-5 through Mr. P. Weiser, an employee of Statistics Canada. Mr. Weiser's role was the compilation of data sent to his office, from various locations. By the very nature of his task, he was unable to confirm or deny that flights took place. He merely collated data sent to him. The exhibit was a photocopy, not certified, or otherwise attested to in any manner by the person originally creating the record. Where it is proffered as the only evidence of a flight having taken place, without corroboration from other sources, I reject it as being insufficient proof.

Tribunal Jurisprudence also reveals cases where corroborated hearsay evidence was accepted and hearsay on its own rejected.[12]

From the foregoing review, only the Pizzardi case accepted hearsay alone as being sufficient proof of an alleged contravention, but no reasons for such acceptance was provided. Most of the jurisprudence found that hearsay, by itself, was not sufficient proof of an alleged offence and some reasoning was provided. We prefer the views expressed in those cases.

Fairness - natural justice

We also find that accepting hearsay evidence as the sole source of evidence to uphold an alleged contravention would be contrary to the tenets of fairness and natural justice. Section 15 of the TATC Act specifically provides that matters shall be dealt with by the Tribunal as informally and expeditiously as the circumstances and considerations of fairness and natural justice permit.

Natural justice is recognized as having two tenets:

  • the right to be heard
  • the right to an unbiased decision

All other rules of natural justice derive from those two tenets. Included in those derivative rules of natural justice are the following:

  • Right to Notice
  • Right to counsel
  • Right to adduce evidence and cross-examine witnesses

The TATC Act at section 16 provides that the Tribunal has the powers of commissioners under Part I of the Inquires Act. That in turn gives members the power to summon witnesses and to require them to give evidence under oath or affirmation. That is reflected in the Tribunal Rules as section 16 provides that witnesses at proceedings be subject to examination and cross-examination on oath or affirmation.

As the DATR exhibits are hearsay in nature the truth of their contents cannot be given by a witness under oath or affirmation. The document holder is deprived of his right under natural justice to cross-examine anyone on the truth of their contents.

The degree to which this evidence is hearsay is noteworthy. Even the authors of the entries, if called to testify, could not confirm or deny that a flight took place. They were not present at the Muskoka Airport. They were stationed at the Buttonville Airport where they recorded what they heard over the radio. They recorded the information on flight strips. Later that information was copied into the DATR sheets. Those sheets formed carbon copies. One copy was forwarded to the Muskoka Airport. Exhibits M-1 and M-2 are copies of that copy.

The Member acknowledges that the evidence in this case was documentary and contradictory, there being no eyewitnesses or other corroborative evidence. We find that when the evidence is documentary and contradictory, corroborative evidence is required.

While the Minister did not introduce corroborative evidence that does not mean it did not exist. In this instance, Transport became suspicious of the circumstance during an audit of the flight school. The auditors would have had access to many records kept by the school. Although we speculate, it may be that a flight school would have student pilots, that is potential eyewitnesses. Even student pilots are required by regulation to keep log books, perhaps another source of corroborative evidence. The jurisprudence reviewed above also reveals other sources of possible corroborative evidence. Of course the Minister is free to investigate and choose the evidence that he wishes to enter and to present his case as he sees fit.

CONCLUSION

We find that it is an error to accept this uncorroborated hearsay evidence as the sole proof of an allegation. The jurisprudence reviewed above convinces us that unsubstantiated hearsay evidence should not be relied upon as it is insufficient evidence upon which to base a contravention.

In this case it is the truth of the contents of the DATRs that goes to the factual basis upon which a contravention may be found. The truth of the contents could not be given by a witness under oath or affirmation, nor could the document holder cross-examine anyone on its contents. In the circumstance, that deprives him of fairness and natural justice.

DECISION

TATC File No. O-2997-41 - The appeal is allowed. The contraventions of subsections 605.86(1) and 605.94(1) of the Canadian Aviation Regulations are dismissed.

TATC File No. O-2988-10 - The appeal is allowed. The suspension of the certificate of airworthiness for aircraft C-FYTC is referred back to the Minister for reconsideration.

March 31, 2005

Reasons for Appeal Decision by:

Allister Ogilvie, Vice-Chairperson

Concurred:

William H. Fellows, Member
Frank Morgan, Member


[1] R v. Khan, [1990] 2 S.C.R. 531.

[2] Sara Blake, Administrative Law in Canada, Second edition (Butterworths, 1997) at page 50.

[3] John Sopinka, Sidney N. Lederman and Alan W. Bryant, The Law of Evidence in Canada (Butterworths, 1992 at page 156).

[4] Leslie James Dolphin v. Minister of Transport, [1990] CAT File No. C-0133-02 (appeal).

[5] Minister of Transport v. Richard Pizzardi and Donald Doyle, [1996] CAT File No. O-0494-37.

[6] Richard Pizzardi and Donald Doyle v. Minister of Transport, [1996] CAT File No. O-0494-37 (appeal).

[7] Alta Flights (Charters) Ltd. v. Minister of Transport, [1990] CAT File No. W-0098-10.

[8] High Country Fishing Ltd. v. Minister of Transport, [1992] CAT File No. W-0143-37 (appeal).

[9] Minister of Transport v. Malcolm Edward McIvor, [1991] CAT File No. C-0135-33 (appeal).

[10] Minister of Transport v. James Jeffrey Rowan, [1997] CAT File No. A-1500-33.

[11] Minister of Transport v. 641296 Ontario Inc. (North East Air Services), [1997] CAT File No. O-1342-37.

[12] Minister of Transport v. Paul George Daoust, [1999] CAT File No. C-1697-33; Minister of Transport v. Centre École de Parachutisme Para-Nord Inc., [2001] CAT File No. Q-2150-37; William R. Long v. Minister of Transport, [2004] CAT File No. O-2824-02 (appeal).


Federal Court of Canada (T)


Decision:

Date: 20070206

Docket: T-48-06

Citation: 2007 FC 129

Ottawa, Ontario, February 06, 2007

PRESENT:   The Honourable Mr. Justice Martineau

BETWEEN:

SIERRA FOX INC.

Applicant

and

FEDERAL MINISTER OF TRANSPORT

Respondent

REASONS FOR ORDER AND ORDER

[1] The applicant Sierra Fox Inc. operates a flight training school at Muskoka Airport and is the registered owner of a Piper PA-28-140 (C-FYTC) (the aircraft or YTC) used for flight training. The Minister of Transport (the Minister) is the respondent to this judicial review proceeding.

[2] The applicant challenges the legality of a Minister's decision rendered on July 4, 2005 (the impugned decision) after the Transportation Appeal Tribunal of Canada (the Tribunal) had ordered the Minister to reconsider its earlier decision of October 31, 2003 suspending the certificate of airworthiness of YTC (the suspension decision). Both decisions were made under the Aeronautics Act, R.S.C. 1985, c. A-2, as amended (the Act).

[3] Essentially, the applicant submits that the impugned decision, which upheld the suspension decision, should be set aside and the matter referred back for reconsideration on the ground that the respondent failed to observe a principle of natural justice, procedural fairness and other procedure that it was required by law to observe. The respondent submits on the contrary that all procedures set out in the Act were followed and that there has been no breach whatsoever of a principle of natural justice or procedural fairness.

[4] For the following reasons, I have come to the conclusion that procedural fairness has been breached by the respondent and that the present application should be allowed.

I - LEGAL FRAMEWORK

[5] The existence of the duty to act fairly is flexible, variable and depends on a variety of circumstances (Knight v. Indian Head School Division No. 19, [1990] 1 S.C.R. 653). The nature of the decision being made and the process followed in making it, the nature of the statutory scheme, the importance of a decision to the person affected and his legitimate expectations are relevant to determining what is required by the duty of fairness in a given set of circumstances (Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817 at paras. 21-28; Kiss v. Canada (Minister of Transport), [1999] F.C.J. No. 1187 at para. 22; Air Nunavut Ltd v. Canada (Minister of Transport)(T.D.), [2001] 1 F.C. 138 at para. 51). But this list is not exhaustive and other factors may also be relevant in this analysis. As stated by Justice L'Heureux Dubé in Baker, above, at para. 22, "the purpose of the participatory rights contained within the duty of procedural fairness is to ensure that administrative decisions are made using a fair and open procedure, appropriate to the decision being made and its statutory, institutional, and social context, with an opportunity for those affected by the decision to put forward their views and evidence fully and have them considered by the decision-maker".

[6] The Minister bears a heavy responsibility towards the public to ensure that aircraft and air carrier operations are conducted safely. This is especially so for Transport Canada inspectors who are in practice charged with the duty of maintaining safety (Aztec Aviation Consulting Ltd. v. Canada, (1990) 33 F.T.R. 210 at para. 6 (T.D.); Swanson v. Canada (Minister of Transport)(C.A.), [1992] 1 F.C. 408 at 414 and 424-426 (F.C.A.)). The direct responsibility of the Minister to ensure public safety is to be inter alia found in the issuance of the certificate of airworthiness of the aircraft itself, which is subject to the operations specifications and conditions expressed therein. Among these there is the general requirement that the document holder comply with the provisions of the Act and of the Canadian Aviation Regulations, SOR/96-433 (the CARs).

[7] Under the current statutory scheme, ministerial action in the form of a suspension of document and/or the imposition of a monetary penalty may follow an audit or administrative inquiry conducted by an inspector or other official of Transport Canada. In the case at bar, the suspension decision was made under paragraph 7.1(1)(b) of the Act, which authorises the Minister to suspend, cancel, or refuse to renew an aviation document on the grounds that:

(b) the holder or any aircraft, airport or other facility in respect of which the document was issued ceases to meet the qualifications necessary for the issuance of the document or to fulfil the conditions subject to which the document was issued…

[8] It is not contested that the Minister must always act in good faith and has the burden to justify the reasonableness of any action taken against a document holder under the Act. In this regard, the Minister cannot act arbitrarily and in the absence of evidence. However, the Act does not formally require that the document holder be heard prior to the taking of a suspension decision by the Minister. It simply requires that a notice of the decision taken accordingly by the Minister be sent to the person before the decision comes into effect (see subsections 6.71 (2), 6.9 (2), 7 (2), 7.1 (2), 7.21 (2) and 7.7 (2) of the Act). The legality of the Minister's decision, including the sufficiency of the notice, may in turn be examined by this Court once the document holder has exhausted its right to have the matter reviewed in first instance and in appeal by the Tribunal (Aztec Aviation Consulting Ltd., above, at paras. 17 and 18; Aviation Québec Labrador Ltée v. Canada (Minister of Transport) (1998), 157 F.T.R. 24 at paras. 11-13 (F.C.T.D.)).

[9] Established by section 2 of the Transportation Appeal Tribunal of Canada Act, S.C. 2001, c. 29 (the TATC Act), the Tribunal replaces the Civil Aviation Tribunal previously created under Part IV of the Act and has an extended jurisdiction in respect of reviews and appeals made under other federal legislations pertaining to the marine and railway sectors. The Tribunal is a quasi-judicial tribunal composed of full-time or part-time members appointed by the Governor in Council who collectively have expertise in the multi-modal transportation sectors in respect of which the federal government has jurisdiction (sections 3 and 4 of the TATC Act). The procedure before the Tribunal is adversarial. The Minister and the holder of the document (or the owner or operator affected by the decision) will have an opportunity, consistent with procedural fairness and natural justice, to present evidence and make representations in relation to the decision under review (subsections 6.9(7), 7(6) and 7.1(6) of the Act).

[10] In any proceeding before the Tribunal, a party that has the burden of proof discharges it by proof on the balance of probabilities, but the Tribunal is not bound by any legal or technical rules of evidence, except that it shall not receive or accept as evidence anything that would be inadmissible in a court by reason of any privilege under the law of evidence (subsections 15 (1), (2) and (5) of the TATC Act). While informal, proceedings before the Tribunal closely resemble those followed in the courts. Hearings are normally held in public and a party to a proceeding before the Tribunal may appear in person or be represented by another person, including legal counsel (subsections 15(3) and (4) of the TATC Act). Witnesses are sworn in and may be compelled to answer questions and produce documents. Indeed, the Tribunal, and each of its members, has all the powers of a commissioner under Part I of the Inquiries Act, R.S.C. 1985, c. I-11 (section 16 of the TATC Act). Proceedings before the Tribunal shall be recorded, and the record shall show all evidence taken and all determinations, decisions and findings made in respect of the proceedings (section 20 of the TATC Act).

[11] If the document holder is unsatisfied by the decision rendered by the member of the Tribunal, a right of appeal exists before an appeal panel composed of three members of the Tribunal (subsection 7.2 (1) of the Act). The current statutory scheme also grants a right of appeal to the Minister in cases where the member may determine the matter by confirming the Minister's decision or by substituting his or her own determination (paragraph 7.2 (1)(b) of the Act, which refers to a determination made under subsection 6.9 (8) or paragraph 7 (7)(b) of the Act). An appeal shall be on the merits based on the record of the proceedings before the member from whose determination the appeal is taken, but the appeal panel shall allow oral argument and, if it considers it necessary for the purposes of the appeal, shall hear evidence not previously available. Moreover, both the member who conducts a review and the appeal panel are compelled to provide reasons (section 17 of the TATC Act).

[12] In the case at bar, a single member of the Tribunal confirmed the validity of the suspension decision taken under section 7.1 of the Act. Section 7.2 of the Act delineates the jurisdiction of the appeal panel of the Tribunal in such a case. Under paragraph 7.2 (3)(a) of the Act, the appeal panel may either dismiss the appeal or refer the matter back to the Minister for reconsideration. That being said, section 21 of the TATC Act provides that "[a] decision of an appeal panel of the Tribunal is final and binding on the parties to the appeal". This gives legal recognition to the binding character of any final determination made by the Tribunal, unless same is judicially reviewed by this Court under sections 18 and 18.1 of the Federal Courts Act, R.S.C. 1985, c. F-7, as amended. In the case at bar, an appeal panel of the Tribunal overturned the decision made by a single member and referred the matter of suspension back to the respondent for reconsideration.

[13] In the event a matter is referred back to the minister for reconsideration, the Act currently provides that the decision of the Minister remains in effect until the reconsideration is concluded, subject to the granting of a stay by the Tribunal. Nothing further is provided in the Act with respect to the process and particular manner the Minister will reconsider a former decision. Respondent's counsel has submitted in this regard that the basic policy and process followed by the Minister on a reconsideration is still the one previously set out in Civil Aviation Directive (CAD) No. 34 – Reconsideration of Civil Aviation Tribunal Decision (CAD 34), which generally provides that "reconsideration of suspensions or cancellations of Canadian aviation documents must be conducted in a manner that ensures fairness and transparency".

[14] Both the impugned decision and the CAD 34 upon which the respondent relies in this case refer to former subsection 7.1(9) of the Act. The latter provision provides that where a matter of suspension or cancellation or refusal to renew an aviation document is referred back to the Minister, the suspension or cancellation shall cease to be of any force or effect until the Minister decides otherwise as a consequence of the reconsideration. However, this provision has been repealed by section 37 of the TATC Act. Be that as it may, in Aztec Aviation Consulting Ltd, above, this Court indicated that "should the Minister not agree with [the Civil Aviation Tribunal] decision, he must reconsider the matter and decide the question again. In doing so, he would of course be under a legal obligation to take into account all of the evidence, representations and findings of the review proceedings during which the plaintiff will have had a full opportunity to be heard and to present evidence" [emphasis added].

[15] That being said, CAD 34 provides that the "responsible authority", here the Minister's designated delegate, shall appoint a "team" of at least three people having the appropriate expertise to review the case. It is not clear in reading CAD 34 whether or not the "team" or the "responsible authority" may consider documentary evidence that was not previously submitted to the Tribunal or receive the unsworn declarations of persons who did not previously testify before the Tribunal. Questioned at the hearing by the Court in this regard, respondent's counsel answered in the affirmative. This would allow for the presentation of evidence not previously submitted by the applicant who could also ask to be heard in person. It would also permit the presentation of additional hearsay evidence that the "team" or the "responsible authority" has obtained on their own from persons who did not testify before the Tribunal or that comes from documents gathered after the Tribunal's final decision to refer the matter back to the Minister. This issue involves procedural fairness. The applicant submits in this regard that the respondent cannot accept uncorroborated hearsay evidence. CAD 34 also provides that the team shall prepare a report setting out the factors that the team considered, the conclusions it reached and the recommendation the team is making to the responsible authority. The responsible authority shall review the team report and either accept or reject the team's recommendation. CAD 34 provides that the responsible authority shall prepare a letter that sets out the Minister's decision and that explains the reasons for the decision and the factors taken into consideration in coming to the conclusion. In the event that the responsible authority rejects the recommendation of the team, the responsible authority must document the reasons for rejection.

II- CONTEXTUAL ANALYSIS

[16] It is not possible to dispose of the complex issues of natural justice and procedural fairness raised in this case without first examining in detail the process that has led to the suspension decision, the review determinations and the final decisions of the Tribunal, as well as to the impugned decision following the reconsideration of the matter by the Minister.

A) Suspension decision and penalties assessment

[17] In the case at bar, during a routine maintenance audit of the applicant, Mr. Ross Jackson, a Transport Canada inspector, noticed that YTC seemed to have a low air time for a flight training aircraft. He and one of his colleagues, Mr. Mark Dixon, another inspector, compared the number of flights listed in the aircraft journey log book (the log book) to the Daily Air Traffic Records (DATRs) for the Muskoka Airport.

[18] The aircraft journey log book (the log book) is a document that is required by the Act to be kept for an aircraft in which, among other items, the actual air times flown are to be recorded. In particular, section 605.94 of the CARs provides that the total air time (TAT) for each flight shall be recorded in the log book in accordance with the particulars set out in columns I, II and III of the corresponding item in schedule I. Indeed, a person who wilfully omits to record a flight in the log book is guilty of an indictable offence or an offence punishable on summary conviction by a court of competent criminal jurisdiction (paragraph 7.3(1)(c) and 7.3(2) of the Act). That being said, section 28 of the Act further provides that in any action or proceeding under the Act, an entry in any record required to be kept under the Act "is, in the absence of evidence to the contrary, proof of the matters stated therein as against the person who made the entry or was required to keep the record…"

[19] The DATRs are written records of local air traffic movements for a particular airport that are used by NAV CANADA and Statistics Canada. In the case at bar, the DATRs had recorded aircraft movements for the aircraft that were not listed in the log book. A further investigation ensued. The two inspectors then compared the entries in the log book to the Muskoka DATRs for the period between August 1 and September 30, 2003. They observed that there were a number of discrepancies between the two records, which led them to conclude that YTC had flown on numerous occasions but that the flight times had not been recorded in the log book. As a result, the certificate of airworthiness (the document) of YTC was suspended on October 31, 2003.

[20] The notice of suspension signed on behalf of the Minister by Mr. Jackson, stated in part:

Pursuant to section 7.1 (1)(b) of the Aeronautics Act, the Minister of Transport has decided to suspend the Certificate of Airworthiness, the Special Certificate of Airworthiness or the Flight Permit in respect of the above aircraft on the ground that the aircraft does not comply with conditions subject to which the document was issued for the following reasons:

The aircraft had not been maintained in accordance with the approved maintenance schedule as required by CAR 605.86 (1)(b). It was noted that flights had been conducted and not recorded in the Aircraft Journey Log Book. These discrepancies have rendered the calculation of Total Air Time inaccurate.

[21] Succinctly put, paragraph 605.86 (1)(b) of the CARs, which is specifically mentioned in the notice dated October 31, 2003, provides that the person who has legal care and control of an aircraft cannot permit the take-off of the aircraft if it has not been maintained in accordance with the individual maintenance plan as detailed in the Small Operator Maintenance Control Manual (the manual). The maintenance plan as approved by the Minister is compulsory and the only variations permitted are those specifically authorized by the Minister.

[22] From the point of view of the document holder, owner or operator, the suspension, cancellation or refusal by the Minister to renew a certificate of airworthiness has a great importance and is likely to cause severe financial hardship. In this case the applicant's ability to carry on business has been severely affected. On or around November 3, 2003, the applicant requested that the respondent reinstate the document and alleged that he was not aware that he had forgotten to enter flights in the log book. Therefore, the applicant asked the Minister to provide details of those flights so that the applicant's representative could make the required corrections immediately in the log book. Moreover, the applicant also served and filed with the Tribunal a request for review of the suspension decision (TACT File No. O‑2988‑10). Since the issuance of the notice of suspension on October 31, 2003, the suspension has remained in effect and the Minister has refused to reinstate the document.

[23] Before the Tribunal had an occasion to review the legality of the suspension decision, on or around March 22, 2004, pursuant to section 7.7 of the Act, the Minister decided to assess monetary penalties totalling $1,750.00 against the applicant (the assessment decision). First, the Minister alleged that the applicant had contravened subsection 605.86 (1) of the CARs, in that between August 1 and September 30, 2003 (the period in question), the applicant had permitted take-offs to be conducted in YTC when the aircraft had not been maintained in accordance with its approved maintenance schedule; flights conducted but not recorded caused the calculation of the cumulative air time or TAT of the aircraft to be inaccurate. Penalty was assessed at $1,250.00 (the first charge). Second, the Minister alleged that during the period in question the applicant had operated YTC on several flights at or near Muskoka and had failed to record the TAT in the log book in accordance with the particulars set out in the regulations, thereby violating subsection 605.94 (1) of the CARs. Penalty was assessed at $500.00 (the second charge). The applicant challenged the legality of the assessment decision and filed a request for review with the Tribunal (TACT File No. O-2997-41).

[24] Prior to the matter being heard by the Tribunal, the applicant offered to do a one thousand hour inspection on YTC in order to satisfy the respondent's concerns, if any, about the safety of the aircraft. This offer was dismissed by the respondent.

B) Review determinations by the Tribunal

[25]  The requests for review made by the applicant (TACT Files Nos. O-2988-10 and O‑2997‑41) were heard by a single member of the Tribunal, Mr. James E. Lockyer, on June 16 and July 14, 2004. Both files were decided on common evidence and oral submissions by the parties.

[26] At the opening of the hearing, the single member took the position that the Minister had to prove, on a balance of probabilities, that the applicant had contravened the Act and the CARs. He also indicated that the applicant had the right to present evidence, cross-examine the respondent's witnesses and make submissions at the end of the proceedings. The single member also characterized the charges in question, which refer to violations of section 605.86 and 605.94 of the CARs, as "strict liability offences". The single member stated that it was entirely within the applicant's right not to adduce evidence. Indeed, no adverse inference would be drawn if the respondent was unable to prove the facts upon which each allegation or infringement was based. (Subsection 7.7(1) of the Act expressly requires that the Minister have "reasonable grounds [to believe] that a person has contravened a designated provision" while subsections 7.91(4) and (5) of the Act further provide that the burden of establishing that a person has contravened a designated provision is on the Minister and that a person who is alleged to have contravened a designated provision is not required, and shall not be compelled, to give any evidence or testimony in the matter).

[27]  However, the single member explained that "once the Minister establishes the elements of [each] offence the burden shifts to the Document Holder to show all due diligence as to why the activity, if it is in fact proved, should not fall within the contravention" (Tribunal's hearing transcript, June 16, 2004, applicant's record at pages 28‑29). Asked by applicant's counsel to clarify what this actually meant with respect to the suspension decision (which as mentioned above was taken pursuant to paragraph 7.1(1)(b) of the Act), the single member stated that "if, in fact, the offence is not proved, then the suspension is nullified effectively" (Ibid. at page 29). Whether the single member was right or wrong in making this ruling of law is not at issue in this proceeding, but there was certainly a legitimate expectation that the validity of the suspension would be contingent upon a Tribunal's finding that the applicant had indeed committed the offences in question. It is on these fundamental premises that the hearing was conducted and that the parties presented their evidence and made their submissions to the Tribunal.

[28] The case presenting officer for the respondent called Mr. Jackson, the investigator who had issued the notice of suspension as well as Mr. Dixon, the other inspector from Transport Canada who had reviewed the DATRs for the Muskoka Airport for August and September 2003. As I already indicated earlier, their conclusion was that YTC had flown more air time than was identified in the aircraft's log book. As a result of this finding, Mr. Dixon forwarded the file to Mr. David Bland, acting regional manager, aviation enforcement for the Ontario region of Transport Canada. The respondent also called Ms. Tracy Kirkhus who was the NAV CANADA site manager for the Toronto flight service station (FSS) housed in the Buttonville Airport Terminal Building located in Markham, Ontario. The Buttonville Nav Canada facility using the remote aerodrome advisory service (RAAS) system was responsible for monitoring all aircraft movements at Muskoka Airport, and recording these movements on the DATRs. She explained that Muskoka Airport did not have a control tower with a NAV CANADA flight service specialist onsite but that its air traffic and aviation weather advisory service was provided remotely by the Toronto FSS at Buttonville through the RAAS system. A NAV CANADA flight service specialist at Buttonville would monitor the Muskoka Airport radar screen and respond to all calls from an aircraft approaching for landing, and all calls from an aircraft about to enter the manoeuvring area (taxiways, runways, etc.) of the airport prior to the departure. All aircraft movements identified as a result of the radio call would be registered on the Muskoka Airport DATR by the flight service specialist. She indicated there were occasional discrepancies in the DATRs caused by workload or other operational considerations. She explained that the DATR top sheet was sent by NAV CANADA to Transport Canada. After 30 days, the top sheet was destroyed. The second sheet went to the airport manager and the third went to Statistics Canada. She indicated that the DATR sheets produced in this case by the respondent (Exhibits M-1 and M-2) did not appear to have been altered in any material way. The respondent also called Mr. Steve Faulkner, the Muskoka Airport manager. He testified that he would receive fax copies of the DATRs from NAV CANADA on a daily basis. He retained the original copies and brought them to the hearing. He compared the originals with the photocopies of the DATRs admitted into evidence as Exhibits M-1 and M-2 and found no difference in data. Mr. Randy Miller, a Transport Canada Civil aviation inspector and a certified aircraft maintenance engineer (AME) also testified for the respondent. He stated that he found 34 entries for YTC in the DATR of the Muskoka Airport for August and September 2003 for which there were no corresponding entries in the log book of the aircraft. He testified that while accurate computation of flight times or air times from the DATRs is not possible, he suggested that the cumulative air time not recorded in the log book could total in this case to 20 or more hours. He exchanged correspondence with the applicant's representative, Mr. Sandro Ferrari, and subsequently met with him. He said that Mr. Ferrari indicated the log book was correct and that the DATRs contained inaccuracies and were therefore unreliable. Indeed, counsel for applicant, during cross-examination of Mr. Miller, pursued the notion that significant inaccuracies were contained in the DATRs. He pointed to five examples as justification for the premise that DATRs were unreliable and could not be used to substantiate the allegations of the respondent.

[29] Mr. Ferrari did not testify at the hearing. That being said, the applicant called one witness, Mr. Claude Radley. In his testimony, he seriously questioned the reliability of the DATRs. Mr. Radley had been a flight service specialist since 1970 and had worked at the Muskoka FSS for 18 years. He had filled out thousands of DATRs; they were always a low priority item. He explained that the initial information received from the pilot was put on air traffic control (ATC) "strips" and then transferred to the DATRs when time permitted. His testimony was that the accuracy of the DATRs was "questionable at best". He testified they were often subject to "padding". He explained "padding" as being false or erroneous entries in the DATRs made by a flight service specialist to inflate workload. This was done to justify his or her position in order to maintain staffing levels and keep their job. He cited the St. Catherines Airport as an example where this practice had taken place. He also said padding took place at the Muskoka Airport FSS while he worked there until 1996 when it was closed and the service transferred to Buttonville. He pointed out that the DATR for Muskoka Airport for September 6, 2003 identified 56 aircraft movements with the comment, "if they actually occurred this is incredible". He surmised this was evidence of padding. However, in cross-examination, Mr. Radley stated that he had never padded any DATRs over his 34 years of service. He said he was not working at Buttonville during the period of August to September 2003. He also said that he had no knowledge that any of the entries identified in Exhibits M-1 and M-2 were padded.

[30] Both review determinations and accompanying common reasons were issued by the Tribunal on August 27, 2004 (the review determinations). First, the Tribunal found that the applicant had contravened subsections 605.86 (1) and 605.94 (1) of the CARs and upheld the monetary penalties assessed by the Minister (TACT File No. O-2997-41). Second, in view of the former determination, the Tribunal confirmed the suspension of the document (TACT File No. O‑2988-10).

[31] In his decision, the single member took a rather straightforward approach in defining the sole issue in this case as being simply "whether there were flights conducted in aircraft C-FYTC between August 1, 2003 and September 30, 2003 which were not entered in the aircraft's journey log book". Indeed, he noted that the principal evidence with respect to the allegation in question was "documentary and contradictory". Therefore, it boiled down to deciding which of the two documents was credible: the DATRs for Muskoka Airport, which indicate YTC made numerous flights during August and September 2003 that were not recorded in the log book, or the log book of the aircraft, which does not show the alleged flights being made. In this regard, the single member was plainly aware that in this instance there were "no eye witnesses of the flights or corroborative evidence to support either document".

[32] In his decision, the single member stressed that the applicant's case was centred on the premise that the DATRs being relied on by the Minister for the period in question were not "accurate, reliable or credible". Consequently, it was the applicant's position that the DATRs should not be admitted in evidence because such hearsay evidence would infringe procedural fairness and natural justice. I pause to mention here that all the witnesses agreed that DATRs cannot be used to determine air times and accordingly, the single member accepted that "for the purposes of these matters, air time and therefore TAT cannot be accurately determined from analysis of the DATRs". In this regard, the single member recognized that the log book is the only record that totals the amount of time the aircraft is in the air and determines when the required maintenance as set out in the manual must be performed by the document holder.

[33] However, the single member decided that the DATRs (certified copies of the original copies of same) may be admitted into evidence and used for enforcement purposes without corroboration. Indeed, he accepted that the DATRs were admissible in this case notwithstanding the document holder's concerns regarding hearsay: "In view of the fact the document holder has had every opportunity to address and deal with the exhibits and viva voce evidence presented in this case, I am satisfied the admissibility of the DATRs does not infringe on procedural fairness or natural justice". The single member also noted that Mr. Radley's testimony raised the issue of whether any of the entries in the DATRs for August and September 2003 were falsified. However, he noted that there was no evidence from Mr. Radley or anyone else, that any entries in Exhibits M-1 and M-2 were actually the subject of padding or falsification. Accordingly, he found as a fact that they were not padded or falsified.

[34] The crux of the determinations made by the single member with respect to the two ministerial decisions under review was set down in the following key findings:

I have, for the reasons indicated, admitted the DATRs into evidence. Counsel for the document holder did not contest or cross-examine any witnesses in relation to the 34 tabbed entries in Exhibits M-1 and M-2 alleged by the Minister to be flights of aircraft C-FYTC. Their value as to the 34 tabbed entries has not been impeached. Other than the journey log book, there was no corroborative evidence introduced by the document holder to show those flights were not conducted or to call that information into question. The document holder has not provided any evidence of due diligence or the applicability of any exceptions or defences as provided for in section 8.5 of the Aeronautics Act.

I conclude on the evidence before me that the flights identified in the DATRs, as conducted in aircraft C-FYTC, did take place. I also conclude there were no corresponding entries recorded in the journey log book for the 34 flights tabbed in Exhibits M-1 and M-2. I therefore find that Sierra Fox Inc. violated subsection 605.94(1) of the CARs on 34 occasions. I also find that Sierra Fox Inc. violated paragraph 605.86(1)(b) of the CARs in that it allowed aircraft C‑FYTC to be flown when the aircraft had not been maintained in accordance with its approved maintenance schedule.

I therefore find the Notice of Suspension of the certificate of airworthiness of aircraft C-FYTC and the Notice of Assessment of Monetary Penalty under paragraph 7.1(1)(b) and section 7.7 of the Aeronautics Act, respectively, were appropriate measures in the circumstances [emphasis added].

[35] The applicant appealed both review determinations.

C) Final decisions of the Tribunal

[36] The two appeals lodged by the applicant were heard together on January 21, 2005 by a three-member panel of the Tribunal composed of Mr. Allister Ogilvie, vice-chairperson and Mr. William H. Fellows and Mr. Frank Morgan, members (the appeal panel). The appeal panel did not hear witnesses or accept new documentary evidence. However, both parties provided extensive arguments on the issues of law and procedural fairness raised in the proceeding. The appeals centered on questions of admissibility and reliability of the respondent's hearsay evidence. The Tribunal allowed the appeals in both files on March 31, 2005.

[37] While the appeal panel agreed that the DATRs may be admitted into evidence and used for enforcement purposes, it found that it was an error of law to accept uncorroborated hearsay evidence as the sole source of evidence to uphold an allegation of contravention. I pause to mention that the main allegation made in the notice of suspension is that "[t]he aircraft had not been maintained in accordance with the approved maintenance schedule as required by CAR 605.86 (1)(b)". This allegation is based on the assumption made by the inspectors, based on the DATRs, that during the period in question some "flights had been conducted and not recorded in the Aircraft Journey Log Book".

[38] Coming back to the final decision of the Tribunal, the appeal panel acknowledged that the Tribunal was relieved of the legal and technical rules of evidence by the operation of section 15 of the TATC Act. However, it added: "Being relieved of the legal and technical rules of evidence does not mean that no rules apply." In the case at bar, the appeal panel found that Exhibits M-1 and M-2, the DATRs, were "hearsay" as they consist of written statements made by persons otherwise than in testimony at the proceeding in which they are offered as proof of the truth of their contents: John Sopinka, Sidney N. Lederman and Alan W. Bryant, The Law of Evidence in Canada (Toronto: Butterworths, 1992) at 156. That being said, the appeal panel also found that such hearsay evidence was relevant because, if true, it would go to establishing the factual basis upon which the contravention could be found: "But not all relevant evidence is of equal probative value".

[39] I note that the inspectors of Transport Canada had no actual or direct proof that the aircraft had not been maintained in accordance with the individual maintenance plan. Here, the DATRs were used by the inspectors to justify the legality of both the suspension decision and the assessment decision made by the Minister. There is no evidence on the record that physical inspection of the aircraft was conducted on site by Mr. Jackson and Mr. Dixon, the two inspectors who testified during the review determination before Mr. Lockyer. Upon review of the applicable jurisprudence, the appeal panel noted that only the Pizzardi case (Minister of Transport v. Richard Pizzardi and Donald Doyle, [1996] CAT File No. O‑0494‑37) "accepted hearsay alone as being sufficient proof of an alleged contravention, but no reasons for such acceptance was provided". Indeed, according to the appeal panel "[m]ost of the jurisprudence found that hearsay, by itself, was not sufficient proof of an alleged offence and some reasoning was provided". In its analysis of the jurisprudence, the appeal referred to a number of cases decided after the Pizzardi case that supported its conclusion: Minister of Transport v. James Jeffrey Rowan, [1997] CAT File No. A‑1500-33; Minister of Transport v. 641296 Ontario (North East Air Services), [1997] CAT File No. O‑1342‑37; Minister of Transport v. Paul George Daoust, [1999] CAT File No. C-1697-33; Minister of Transport v. Centre École de Parachutisme Para-Nord Inc., [2001] CAT File No. Q‑2150-37; William R. Long  v. Minister of Transport, [2004] CAT File No. O-2824-02 (appeal).

[40] The appeal panel also found that accepting hearsay evidence as the sole source of evidence to uphold an alleged contravention would be contrary to the tenets of fairness and natural justice that the Tribunal was bound to respect. The appeal panel noted that section 15 of the TATC Act specifically provides that matters shall be dealt with by the Tribunal as informally and expeditiously as the circumstances and considerations of fairness and natural justice permit, while section 16 of the TATC Act provides that the Tribunal has the powers of commissioners under Part I of the Inquiries Act, which in turn gives members the power to summon witnesses and to require them to give evidence under oath and affirmation: "As the DATR exhibits are hearsay in nature the truth of their contents cannot be given by a witness under oath or affirmation. The document holder is deprived of his right under natural justice to cross-examine anyone on the truth of their contents". Accordingly, the appeal panel found that when the evidence is documentary and contradictory, corroborative evidence is required. The appeal panel further noted that while the Minister did not introduce corroborative evidence, this did not mean that such corroborative evidence did not exist. The appeal panel pointed to the fact that during the audit of the flight school operated by the applicant, the inspectors would have had access to many records kept by the school. Student pilots could have been "potential eyewitnesses" and "[e]ven student pilots are required by regulation to keep log books, perhaps another source of corroborative evidence." The appeal panel also indicated that the jurisprudence reveals other sources of possible corroborative evidence such as fuel receipts to prove that the aircraft had actually flown at the dates indicated in the DATRs.

[41] Therefore, it turned out in this case that the Minister had simply failed to demonstrate to the satisfaction of the Tribunal that the applicant had contravened subsections 605.86(1) and 605.94(1) of the CARs during the period in question. Accordingly, the contraventions of subsections 605.86(1), 605.94(1) of the CARs were dismissed (TACT File No. O-2997-41). Moreover, the suspension of the aviation document was not an appropriate measure and, as a result, the matter was referred back to the Minister for reconsideration (TACT File No. O‑2988‑10). As mentioned above, both appeal decisions and accompanying common reasons were issued on March 31, 2005.

D) Reconsideration of the suspension decision

[42] Sometime in June 2005, the applicant received a letter dated June 1, 2005 from Transport Canada signed by Mr. Marquis Monfette, A/Chief, Operations, Aircraft Maintenance & Manufacturing (the reconsideration notice). Mr. Monfette did not submit an affidavit in this proceeding. According to the Affidavit of Ms. Beverlie Caminsky, Mr. Monfette and two other knowledgeable persons employed by Transport Canada were appointed to review the circumstances of the suspension of the document and make their recommendations to the "Responsible Authority", here the Minister's delegate. CAD 34 defines the "Responsible Authority" as meaning "the person who has been authorized to exercise the Minister's reconsideration authority under subsection 7(9) or 7.1(9) of the Aeronautics Act" (see paragraphs 10-16 of the affidavit of Ms. Beverlie Caminsky and "definitions" of CAD 34).

[43] The reconsideration notice informs the applicant that:

A panel has been convened in the Transport Canada Headquarters pursuant to section 7.9 of the Aeronautics Act, to reconsider the Transportation Appeal Tribunal of Canada (TATC) appeal decision in the matter of Sierra Fox Inc. and Minister of Transport, TATC File No. O-2988-10.

As part of the reconsideration process, it is your right to make representations or submissions to introduce any relevant information other than what has already been disclosed during the review and appeal hearings. This information can be presented to the panel in person, by pre-arranged teleconference, or in writing, but in all cases, no later than June 17, 2005.

[44] According to the applicant's representative, Mr. Ferrari, the letter on June 1, 2005 was a follow up to a phone call from Mr. Monfette which had taken place a day before and which he summarized during his cross-examination in the following manner:

First of all the telephone call came as a surprise to me, because he said that he had been instructed to convene a committee to investigate the Notice of Suspension. And he said that there were three members and only two of them were there and they had started the investigation at that time, without the third party. And he asked me if I had any new evidence to submit and I said no, that the only evidence was submitted at the review. And I said based on that evidence, that the suspension was not valid.

He informed me then that they were not required to abide by any tribunal decision, they were not obligated to accept any testimony being truthful and they were not obligated to accept any evidence as being factual. Which was pretty much the whole thing (Respondent's record at page 58).

[45] On or around June 15, 2005, through his legal counsel, the applicant responded to the reconsideration notice in the following manner:

I respond to your letter of June 1, 2005. My client intends to proceed against Transport Canada for damages suffered and caused by the malicious prosecution by your department which proceedings were ultimately dismissed in my clients' favour. During the time taken by these criminal proceedings my client lost the sale of his business, the airplane (C-FYTC) over which the certificate of air worthiness was suspended has deteriorated and my client has lost revenues not being able to operate his charter business and ground school. He has no interest in providing further information. Your department has investigated and reviewed and had the opportunity of same over the following records:

1 the student records;

2 the flight sheets;

3 the journey log book for the C-FYTC aircraft.

[46] On or around June 18, 2005, the reconsideration panel submitted its report to the Minister's delegate. The reconsideration panel recommended, inter alia, that the suspension of the certificate of airworthiness remain in effect, and apparently reached that determination by "balancing the value of the log book versus DATRs", concluding that "on the balance of probabilities the DATRs is more likely to be accurate on the whole than the Journey Log Book."

[47] The reconsideration panel recognized in its report that there was no corroborative evidence of the entries made in the DATRs, which are hearsay in nature. However, while there may be errors or omissions in the DATRs that are used for billing and other purposes by NAV CANADA and Statistics Canada, "[t]here would appear to be little motive for Nav Canada personnel to make false entries to the DATRs, whereas there are reasons for aircraft operator to omit entries in the Aircraft Journey Log Book due to the cost of maintenance tied to aircraft hours (engine maintenance, airframe maintenance, component replacement /overhaul, etc.)."

[48] The reconsideration panel also found that "[f]or the two‑month period reviewed, the aircraft could conservatively be confirmed as flying 3.5 times as many hours as were logged".

[49] In its report, the reconsideration panel also referred to an offer purportedly made by the applicant's representative, Mr. Ferrari, on May 31, 2005 to the effect that "he was willing to do the highest-level inspection (1000 hour)". The authors of the report noted in this regard that "[w]e did not discuss this as we are not the decision maker, and we did not discuss component overhaul".

[50] The issue of the 1000 hours inspection came in the course of the discussion Mr. Monfette had with Mr. Ferrari on May 31, 2005 prior to the day the reconsideration notice was sent to the applicant. In his cross-examination on affidavit, Mr. Ferrari has mentioned in this regard:

The one thousand hour inspection came up and basically how that came about is that prior to the initial review, there was a conference where I offered to do a one thousand hour inspection. Their concern was the aircraft was not safe to fly and I said one thousand hour inspection would more than satisfy their concern about the safety of the aircraft. And at that time it was offered as an opportunity to get things resolved; the Transport rejected that offer and that is the reference to the one thousand hour inspection. That offer was never made again after that. So that is the reference to the one thousand hour inspection (Respondent's record at pages 58-59).

[51] That being said, the reconsideration panel noted in the recommendation section of their report that "[t]he suspension document does not state what conditions are to be met for reinstatement." Accordingly, the reconsideration panel recommended to the Minister that "[r]einstatement conditions […] be provided in writing to the owner" and stated that "[t]hose conditions should presume that the aircraft has been operated for a significant period of time without all required maintenance, i.e. that the aircraft has an incomplete maintenance history with what amounts to unknown usage gaps." The reconsideration panel then referred to the "Approved Maintenance Schedule". In this regard, "[t]he aircraft owner should be required to demonstrate that the aircraft has been returned to compliance with the maintenance schedule by an inspection to the highest level specified in the Approved Maintenance Schedule". However, the reconsideration panel added that "[t]he Approved Maintenance Schedule may have some room for amendment prior to undertaking the required maintenance actions."

[52] The report prepared by the reconsideration panel was not transmitted for comment to the applicant prior to the taking of the impugned decision.

[53] The impugned decision was issued some 13 weeks after the final decision of the Tribunal had been rendered in this case. The impugned decision is in the form of a letter dated July 4, 2005 signed by the Minister's delegate, Ms. Jacqueline Booth-Bourdeau. There appears to have been some confusion concerning the matter which was actually the object of reconsideration by the Minister. At first, the applicant was advised in writing by the Minister's delegate that "the Minister's decision to suspend the Applicant's Approved Maintenance Organization Certificate is upheld" (exhibit 1 to cross-examination of Beverlie Caminsky).

[54]  However, in his corrected version (exhibit 3 to cross-examination of Beverlie Caminsky) which was sent by fax to the applicant on July 4, 2005, the letter of the Minister's delegate has been modified to now read:

At the conclusion of your TATC proceedings, the Tribunal Members referred your case back to the Minister for reconsideration.

As required by Civil Aviation Directive (CAD) 34, all case referrals, as per subsection 7.1(9) of the Aeronautics Act, must be reviewed by a panel of experts. A team of inspectors who are knowledgeable in this subject matter reconsidered your case file. The minutes of the reconsideration panel's deliberations are attached as Appendix A.

Having given consideration to the TATC review and appeal determinations, and to the reconsideration panel's determination and recommendation, it is my determination that the Minister's decision to suspend the Certificate of Airworthiness for Canadian registered aircraft C-FYTC is upheld [emphasis added].

[55] Attached to the impugned decision was a copy of the purported "minutes of the reconsideration panel's deliberations" (the reconsideration panel report).

III- BREACH OF PROCEDURAL FAIRNESS

[56] The present judicial review proceeding follows the refusal of the Minister to rescind the suspension decision after having reconsidered the matter. There are a number of issues raised in this case by the applicant that involve procedural fairness. They cover three aspects:

1) the service and content of the original notice of suspension;

2) the transparency and fairness of the reconsideration process; and

3) the use of uncorroborated hearsay evidence.

[57] I will consider each of these three aspects successively.

A) Service and content of the original notice of suspension

[58] The applicant argues that, from the very start, the procedures set out in the Act were not followed by the respondent. First, the notice of suspension was somewhat deficient as it "failed to identify, set out or list the condition(s) upon which the notice was issued" contrary to paragraph 7.1 (2)(a)(ii) of the Act. Second, the service of the notice was non-compliant with the Act as the respondent "purported to suspend the certificate of airworthiness of the aircraft by faxing a copy to the applicant and by leaving a message on [the applicant's representative's] voice machine that the certificate of airworthiness had been suspended".

[59] I will start with the issue of service by noting that subsection 7.1(1) of the Act requires that the notice be sent to the holder of the document or the owner or operator of the aircraft by "personal service or by registered or certified mail". Accordingly, the Minister does not comply with the requirements imposed by the latter provision if he simply faxes a copy of the notice and leaves a message on a voice machine. That being said, the applicant acknowledged receipt of the suspension decision by registered mail dated November 3, 2003. Moreover, subsection 7.1(2.1) of the Act provides that the Minister's decision to suspend or cancel a Canadian aviation document takes effect on the date of receipt of the notice, unless the notice indicates that the decision is to take effect on a later date. Accordingly, the suspension decision could not legally take effect on October 31, 2003, as indicated in the notice. However, considering that the procedural defects noted above are not fatal – as it appears the document holder received the notice of suspension through other means – and that the applicant had suffered no prejudice, I find that the suspension decision actually took effect on November 3, 2003, that is on the date that the applicant acknowledged receipt of the notice of suspension.

[60] The second procedural concern is related to the contents of the notice itself, in that it is missing certain essential elements. The general purpose of the notice is set out in paragraph 7.1 (2)(a)(ii) of the Act, which requires that the Minister indicate "the conditions subject to which the document was issued that the Minister believes are no longer being met or complied with". In the case at bar, the notice of suspension clearly states the ground upon which the suspension decision was taken in the first place, which was that in the opinion of the Minister "[t]he aircraft had not been maintained in accordance with the approved maintenance schedule as required by CAR 605.86 (1)(b)". That being said, a closer reading of the particulars contained in the notice confirms that the suspension decision was indeed taken because some "flights had been conducted and not recorded in the Aircraft Journey Log Book". Therefore, since the applicant had purportedly contravened section 605.86 of the CARs, the aircraft did not comply "with conditions subject to which the document was issued". It is important to stress here that the suspension decision was not taken by the respondent on the grounds that "an immediate threat to aviation safety or security exists or is likely to occur" (which is the case where a suspension decision is taken under section 7 of the Act), but because the alleged contravention and failure to record some flights in the log book had caused "… discrepancies [that] have rendered the calculation of Total Air Time inaccurate" as the notice of suspension further explains. While the notice of suspension did not specifically state what these "discrepancies" were, it later became apparent to the applicant in the course of the proceedings before the Tribunal that the respondent was indeed relying on some 34 entries for YTL in the DATRs of the Muskoka Airport for August and September 2003 for which there were no corresponding entries in the log book of the aircraft. But the use of such hearsay evidence without corroborating evidence has been legally questioned and is now raised by the applicant as a specific ground for setting aside the impugned decision which, again, is based again on the same hearsay evidence that was held to be unreliable by an appeal panel of the Tribunal as explained above.

[61] At the hearing before this Court, respondent's counsel submitted that the legality of the suspension decision was not contingent upon the notice of suspension setting out what particular conditions had to be met in order to have the suspension lifted by the Minister. It is not necessary to decide this issue. I will only note that on November 3, 2005, the respondent sent to the applicant a copy of the original notice of suspension issued on October 31, 2003, as well as an "appendix" that purported to clarify the conditions required to reinstate the certificate of airworthiness of the aircraft. This letter was prepared precisely two years after the suspension decision had come into effect (the applicant would now have the right under subsection 8.3(1) of the Act to make an application to the Minister to have the notation of the suspension removed from the record, and same shall be granted by the Minister unless "the removal from the record would not be in the interest of aviation safety or security".)

B) Transparency and fairness of the reconsideration process

[62] There is no mention of CAD 34 in the reconsideration notice. Counsel for the respondent acknowledged at the hearing of this application that the reference to section 7.9 of the Act in the reconsideration notice was wrong and, perhaps, misleading. Indeed, section 7.9 of the Act provides that if a person who is served with a notice of penalty assessment under subsection 7.7 (1) pays the amount specified in the notice, the Minister shall accept the amount as and in complete satisfaction of the amount of the penalty for the contravention alleged in the notice and "no further proceedings under this Part shall be taken against the person in respect of that contravention". But in this case, the penalties imposed by the Minister had already been annulled by the Tribunal on March 31, 2005. Following a query made by respondent's counsel near the conclusion of Mr. Ferrari's cross-examination on affidavit on April 6, 2006, applicant's counsel stated that when he looked at the letter dated June 1, 2005, he "didn't understand how [section] 7.9 [of the Act] had anything to do with the issue" but did not make further enquiries about it "because [Mr. Ferrari] indicated to whoever called from the Panel, that there wasn't any further evidence other than what was in the record" (Respondent's record at pages 60-61).

[63] Moreover, the reasons to uphold "the Minister's decision to suspend the Certificate of Airworthiness for Canadian registered aircraft C-FYTC", mentioned in the amended letter of July 4, 2005, are lacking particulars with respect to the evidence and factors considered by the decision-maker, here the Minister's delegate, Ms. Booth-Bourdeau. However, I am ready to accept respondent's submission that, in accordance with CAD 34, the reasons for maintaining the suspension are to be found in the report of the reconsideration panel since the Minister's delegate apparently decided to accept the recommendation that "[s]uspension should remain in effect". However, I note that the Minister's delegate decision does not address what seems to be another important aspect of the reconsideration panel report, which is what should be the required level of maintenance that ought to be performed by the applicant under the "Approved Maintenance Schedule". It is not clear whether the Minister's delegate was in agreement or disagreement with the particular recommendations made by the reconsideration panel in this regard. The failure to address this issue in the impugned decision certainly affected the transparency of the process.

[64] I note at this point that the reconsideration panel's reasons for accepting the DATRs are similar or identical to the reasons earlier provided by the single member of the Tribunal. However, with respect to the particular finding that the aircraft has flown 3.5 times as many hours as were logged during the period in question, it is not clear from the reading of the reconsideration panel report on what documentary and/or testimonial evidence this very important factual assumption was made. That being said, it seems to be a clear departure from the finding previously made by the single member of the Tribunal to the effect that: "[a]ll witnesses agreed that, for various reasons, DATRs cannot be used to determine air times". The report also mentions the names of Mike Bird, Mel Bushby, Denis Paré, in addition to Mark Dixon who has previously testified. This raises serious doubts as to what was exactly the input of these persons in the decision-making process. We also do not know what they have said to the members of the reconsideration panel.

[65] There is no evidence on record that the applicant was aware of the policy set out in CAD 34 with respect to the reconsideration cases. Since the applicant's representative, Mr. Ferrari, had not testified before the Tribunal, the respondent had the duty to provide him with an opportunity to submit any relevant information on the entries made by the applicant in the log book. Procedural fairness also required that the applicant be given the opportunity to respond to any additional evidence upon which the respondent intended to rely on. The notice that was actually sent to him was deficient and misleading. It appears that during the reconsideration process, persons who had not been witnesses were contacted and interviewed in the absence of the applicant. Moreover, the applicant was not provided with an opportunity to comment on the report and the recommendations made by the reconsideration panel prior to the taking of a final decision by the Minister's delegate. Accordingly, I find that the process followed by respondent to make the impugned decision has been far from being fair and transparent. This finding would be sufficient in my opinion to set aside the impugned decision and return the matter back to the Minister, but I will nevertheless examine the use of uncorroborated hearsay evidence by the Minister in the present circumstance of this case.

C) Use of uncorroborated hearsay evidence

[66] In the case at bar, it is not contested that the Minister had the obligation to consider all the relevant evidence. This certainly included all the admissible evidence previously adduced before the Tribunal. At issue in this proceeding is, inter alia, the Minister's right to base the impugned decision solely on uncorroborated hearsay evidence, which has been held by the Tribunal to be unreliable in the absence of corroborative evidence. It is not necessary to determine, absent of a Tribunal ruling, whether the Minister can generally make a decision based on hearsay evidence. Here, the issue of hearsay must strictly be examined from the point of view of legitimate expectations when a ruling of the Tribunal has been made in regard of evidentiary and procedural fairness matters.

[67] The main submission by the respondent in this case is that the impugned decision was discretionary and that it could be based on uncorroborated hearsay evidence despite the fact that the Tribunal has held such evidence to be unreliable. In my opinion, this submission by the respondent results from a misreading of the Act, which must be read in conjunction with the TATC Act, and cannot withstand an analysis thereof.

[68] It has been stated by this Court in Kiss, above, at para. 31, that "the statutory scheme vests broad discretion in the Minister in the interest of public safety". In practice, this ministerial discretion manifests itself in the discretion left to the inspectors of Transport Canada to choose what particular action, monetary penalty or other mean of enforcement or prosecution will be taken in the name of the Minister against a document holder, an owner or an operator of aircraft who does not comply with the Act or the CARs (Swanson, above, at 414 and 424-26 (F.C.A.); Canada (Attorney General) v. Woods (2003), 223 F.T.R. 298 at paras. 13-15, 26 and 29 (F.C.)). I note that the obligation to record a flight in the log book is a very serious matter. Any dereliction of the duty to record in the log book each and every flight and the corresponding air time may disrupt the maintenance schedule and render it impossible to follow. In the case at bar, no criminal charge has been laid out against the applicant under paragraph 7.3 of the Act for the alleged omission to record during the period in question some flights in the log book. Moreover, an appeal panel of the Tribunal, by final decision, has dismissed the allegations made by the Minister that the applicant has contravened subsections 605.86 (1) and 605.94 (1) of the CARs during the period in question.

[69] The discretion vested to the Minister or a delegate to suspend or cancel an aviation document is not absolute and can only be exercised on a ground mentioned in an applicable provision of the Act. In this case, as indicated in the notice of suspension, the certificate of airworthiness of YTC has been suspended in the first place because the Minister purportedly had proof or reasons to believe that "[t]he aircraft had not been maintained in accordance with the approved maintenance schedule as required by CAR 605.85(1)(b)". While the authority to revoke or maintain the suspension of the document rests exclusively with the Minister, section 21 of the TATC Act provides specifically that "[a] decision of an appeal panel of the Tribunal is final and binding on the parties to the appeal". It turned out that the evidence upon which the suspension decision was purportedly taken under the authority of paragraph 7(1)(b) of the Act was all hearsay in nature. The appeal panel of the Tribunal found in this regard that when the evidence is documentary and contradictory, as it is here when the log book is compared with the DATRs, corroborative evidence is required. Accordingly, the applicant had a legitimate expectation that following the appeal panel's decision to refer the matter of suspension back for reconsideration, the Minister would have to seek corroborative evidence to supplement the DATRs if he wished to uphold his initial finding that the aircraft had not been maintained in accordance with the approved maintenance schedule, as required by paragraph 605.85(1)(b) of the CAR.

[70] I conclude that a document holder would be placed in an intolerable position if the Minister was free to reconsider a suspension decision made earlier without regard to a final decision of the Tribunal or the principle involved in it, in this case, the acceptance of uncorroborated hearsay evidence to uphold an allegation of contravention to the CARs (which was raised by the Minister as a ground to suspend the certificate of airworthiness of the aircraft and to assess monetary penalties against the applicant). There should be strong argumentative reasons not to follow a binding and final decision of the Tribunal. It is not alleged by the respondent that the Tribunal overlooked a statutory provision or a case that ought to have been followed with respect to the use and conditions of use of hearsay evidence. The laconic observations made in the report of the reconsideration panel concerning the effect of the appeal panel ruling, and the lack of reasons in the impugned decision made by the Minister's delegate, do not come close to a justification. If I were to accept the respondent's submission in this case, a decision of the Tribunal would have no finality on any legal point. This is contrary to the intent of Parliament, which is clearly expressed in the TATC Act. This would also lead to a sense of injustice on the part of parties who expect a decision rendered by an appeal panel of the Tribunal on a point of law, including an issue of natural justice, to be binding and final. Indeed, in the case at bar, the error of law and the breach of a principle of natural justice mentioned in the decision of the appeal panel of the Tribunal constituted the very reasons why it dismissed the allegations of contravention and returned the matter of suspension back to the Minister for reconsideration.

IV- CONCLUSION

[71] To summarize, I have found that the Minister has an important role to play in the area of aeronautics and must ensure that aircrafts and airline operations are safe. The suspension decision was of crucial importance to the applicant and its owners and employees and same affected the applicant's ability to carry on business. After a thorough examination of the matter by a quasi‑judicial tribunal, the Minister was asked to reconsider the suspension decision. The decision made by the appeal panel of the Tribunal was a final one and has not been overturned by this Court.

[72] I have also found that the reconsideration process must be fair and transparent. The determinations made by the Minister are factual in nature and must be based on the evidence. In the case at bar, the reconsideration panel was not empowered to make a final decision, but only to make a recommendation to the Minister's delegate. The applicant had the right to present evidence and comment on any new evidence considered by the Minister. The reconsideration panel in this case contacted persons who never testified before the Tribunal and there is no way to ascertain what they actually told the reconsideration panel. Moreover, the applicant was not provided with the opportunity to comment on the report and the recommendations made by the reconsideration panel before a final decision was made by the Minister's delegate.

[73] I have also found that the logbook is proof of the matter stated therein, absent evidence to the contrary. In the case at bar, the Minister's delegate decided to uphold the suspension based on the evidence contained in the report that "[f]or the two-month period reviewed, the aircraft could conservatively be confirmed as flying 3.5 times as many hours as were logged". This finding is based on the same hearsay evidence that was held to be unreliable by an appeal panel of the Tribunal. The applicant had a legitimate expectation that, in the reconsideration process, the Minister would not accept uncorroborated hearsay evidence. The final determination made by the Tribunal in this regard was not set aside by this Court and must stand.

[74] Consequently, I have found that the respondent has breached a principle of natural justice or procedural fairness. The impugned decision should be set aside and the matter returned for reconsideration by another reconsideration panel and another Minister's delegate. In view of the result of this proceeding, the applicant is entitled to its costs against the respondent.

ORDER

THIS COURT ORDERS that:

1.   The application for judicial review is allowed with costs against the respondent; and

2.   The decision rendered on July 4, 2005 on behalf of the Minister to uphold the Minister's initial decision to suspend the certificate of airworthiness of the aircraft is set aside and the matter is referred back for reconsideration by another reconsideration panel and another Minister's delegate.

"Luc Martineau"

Judge

FEDERAL COURT

NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET: T-48-06

STYLE OF CAUSE: SIERRA FOX INC. and

THE FEDERAL MINISTER OF TRANSPORT

PLACE OF HEARING:   Toronto, Ontario

DATE OF HEARING: December 12, 2006

REASONS FOR ORDER

AND ORDER BY: MARTINEAU J.

DATED: February 06, 2007

APPEARANCES BY:

William J. Leslie   For the Applicant

Shelley C. Quinn   For the Respondent

SOLICITORS OF RECORD:

Stewart, Esten

Toronto, Ontario For the Applicant

John H. Sims, Q.C.

Deputy Attorney General of Canada For the Respondent