This case involved a fish processing plant that was refused a fish processing licence from the Provincial Minister of Fisheries because of its alleged indebtedness to the Provincial Government arising from a loan guarantee. The fish processor commenced a judicial review proceeding against the Government and its officials and then obtained an interim declaration that the fish processor had a right to have its 2004 processing licence issued to it and order that the licence be issued pending litigation.
On appeal by the Crown, the appeal court vacated the interim declaration on the grounds that it was unnecessary as an interlocutory injunction was available.
With respect to the issue of whether or not an interlocutory injunction should be issued, after a lengthy review of the applicable authorities on injunctions and related authorities on stays of proceedings, the court the court set out the following test:
All these comments suggest that it is time to set aside attempts to develop separate jurisprudence for mandatory versus prohibitory interlocutory injunctions or to make distinctions between interlocutory injunctions and stays of proceedings. Rather, there needs to be a focus on the principles applicable to all these analyses.
I would adopt the view that, while there must be a serious issue to be tried, to begin with all that is required is a finding that the issue is neither frivolous not vexatious. Once that is determined the court must consider the issues of irreparable harm and balance of convenience. Those latter two issues may be weak for the applicant, in which case it may be necessary to take another look at the seriousness of the issue to be tried. Where the case for the applicant appears almost certain to be found in his favor, then the other issues may not need to have a particularly strong weight in their favor, they could even be neutral. However, even where a judge is doubtful about the success of a case, but cannot find the issue to be frivolous, then irreparable harm to the applicant and/or overwhelming inconvenience to the applicant as opposed to very little inconvenience to the respondent, can decide the issue in the applicant’s favor. (para. 64-5).
Although the trial level judge granted an injunction, he did not state state what test, if any, he applied in granting the injunction. Accordingly, his decision amounted to an error of law. Since all of the material in support of the original application was before the appeal court, it considered the injunction application on its merits.
With respect to the first part of the three part test, although the material put forward was not strong, it convinced the court that there was a serious issued to be tried, because of the allegations that the discretion of the Treasury Board on whether or not to direct the minister to issue a processing licence was fettered by public announcements of the premier of the province. In addition, there was some evidence to suggest that the fish processor was not truly indebted to the province. However, given the existence of a strong privative clause, the existence of a serious issue to be tried was not sufficient to support an injunction without strong evidence of irreparable harm or balance of convenience.
In this regard, the Government provided no evidence of irreparable harm. Conversely for the fish processor there was evidence that: (1) the processor had been issued licences for the 12 previous years; and (2) the failure to obtain a licence would mean it could not hire its workers, process fish, meet the requirements of its suppliers and possibly go out of business.
Based upon all of the above, the appeal court was prepared to issue an interlocutory injunction. Although it was not prepared to order the government to issue a licence in the future, it granted an order enjoining the Minister of Fisheries, Aquaculture and the Environment from refusing to issue a fish processing licence to the fish processor on the basis that it was indebted to the province (para. 101).