In 1987 the Minister of Fisheries sent the Plaintiff, fishing company, a telex advising that he had authorized the issuance of 4 offshore lobster licences. The Plaintiff then provided the Minister with details of its fishing plans, including the fact that it would be converting its scallop vessels into lobster fishing vessels. After the initial notification, the issuance of the licences became a political issue and after intense lobbying from the inshore lobster fleet, the Minister announced that the 4 licences would not be issued pending further study. A study was completed which recommended that no new offshore licences be issued, since that could "influence the distribution of income derived from the lobster fishery, the ability of new entrants to gain access to the fishery and the relationship between the inshore and offshore fisheries." The Licences were never issued. At the trial level, the Federal Court held the Minister of Fisheries liable in negligence. On appeal, the Federal Court of Appeal, with Linden J. dissenting, reversed the decision of the trial court. Mr. Justice Major writing for the Supreme Court of Canada noted that section 7 of the Fisheries Act is silent on whether the Minister of Fisheries can revoke an authorization previously given. He then reviewed the authorities on the Ministers absolute discretion under section 7 and concluded as follows:
It is my opinion that the Minister’s discretion under s. 7 to authorize the issuance of licences, like the Minister’s discretion to issue licences, is restricted only by the requirement of natural justice, no regulations currently being applicable. The Minister is bound to base his or her decision on relevant considerations, avoid arbitrariness and act in good faith. (para. 36)
He went on to conclude that the power to authorize the issuance of a licence under section 7 is a continuing power within the meaning of section 31(3) of the Interpretation Act which can be revoked at any time prior to issuance of the licence. Since the Minister revoked his prior authorization for the purpose of invoking government policy, negligence was not established. The Appeal was dismissed without costs.
Counsel for the Plaintiff/Appellants: Stewart McInnes, Q.C. David S. MacDougall
Counsel for the Defendants/Respondents: David Sgayias, Q.C. Michael Donovan
Editors note: For an interesting comment on this case see  76 C.B.R 253.
Postscript: With respect to the quote set out above, readers should be cautioned not to interpret this so as to equate natural justice with the requirement of the decision maker to exercise his or her discretion "on relevant considerations, avoid arbitrariness and act in good faith". In this regard, see:
(1) Thomson v. Minister of Fisheries F.C.T.D. No. T-113-84 referred to at para. 36 of Comeau;
(2) Maple Lodge Farms Ltd. v. The Government of Canada  2 S.C.R. 2 as referred in Thomson above at footnote 9(in particular see the use of the words "and" after the words "natural justice" in the second to the last paragraph); and
3) Brown and Evans, Judicial Review of Administrative Actions in Canada section 14:2633 and chapter 7:4000).