REPLY SUBMISSION OF THE ALBERTA PROVINCIAL JUDGES ASSOCIATION. to the 2013 JUDICIAL COMPENSATION COMMISSION

Transcription

1 REPLY SUBMISSION OF THE ALBERTA PROVINCIAL JUDGES ASSOCIATION to the 2013 JUDICIAL COMPENSATION COMMISSION MYERS WEINBERG LLP Barristers and Solicitors Graham Avenue Winnipeg, MB R3C 0J7 Susan Dawes Counsel for the Association Telephone: (204) Facsimile: (204)

2 Reply Submission of The Alberta Provincial Judges Association to the 2013 Judicial Compensation Commission Index LEGAL PRINCIPLES RELEVANT TO JUDICIAL COMPENSATION (PARA 6)... 1 CRITERIA (PARA 14)... 3 APPLYING THE CRITERIA (PARA 40)... 7 Guarantee of Judicial Independence (para 40)... 7 The Need to Maintain a Strong Provincial Court... 8 Historical Compensation Comparison (para 68) Federally Appointed Judges (para 101) Real per capita income in Alberta (para 121) The Need to Provide Fair and Reasonable Compensation in Light of Prevailing Economic Conditions in Alberta and the Overall State of the Economy, Including the Financial Position of Government (para 132) Cost of Living Alberta Consumer Price Index (para 147) AWE Data (para 163) THE MINISTER S COMPENSATION INCREASE PROPOSAL Cost GOA s Proposed Cap on Indexing (para 201) Comparisons to Public Sector Increases (para 202) Specific Salary Comparison to Ontario Provincial Court Judges (paras 208) Alberta s Tax Advantage (para 218) i -

3 Calculation of the Cost of the Minister s Salary Increase Proposal (para 223) PENSION (PARA 230) A. Reducing the Vesting Period in the Judicial Pension B. Choice of Alternative Form for Pension Partner VACATION LEAVE (PARA 234) JUDICIAL INDEMNITY (PARA 243) PER DIEM (PARA 248) PROFESSIONAL ALLOWANCE (PARA 252) ii -

4 1. Set out below is the Association s Reply to the Submission of the Minister of Justice and Solicitor General in and for the Province of Alberta dated September 12, It is referred throughout as the Government s Submission and where possible, the headings and paragraph numbers from the Government s Submission are used for ease of reference. 2. The Association addresses below the Government s Submission on each of the various issues. As set out below, the Government has failed to explain how its salary and vacation proposals are supported by the criteria identified in the Commission Regulation. Further, the proposals are inconsistent with the reasoning of the past JCCs which the Government urges this 2013 JCC to consider. 3. The matter of the Health Spending Account ( HAS ) that has been available to judges for a number of years is raised only on page 2 of the Government s Submission. The Government proposes that as need be, the JCC confirm the HAS already being provided to judges. The Association s position is that such a recommendation is not needed. LEGAL PRINCIPLES RELEVANT TO JUDICIAL COMPENSATION (PARA 6) 4. The Government s paragraphs 6 to 9 suggest that judicial independence originates in s.11(d) of the Charter of Rights and Freedoms. In PEI Reference, Lamer CJC, as he then was, did resolve the appeals on the basis of s.11(d) because of the manner in which the cases were argued. However, he also reviewed what he considered to be an unwritten basis of judicial independence. He summarized as follows: In conclusion, the express provisions of the Constitution Act, 1867 and the Charter are not an exhaustive written code for the protection of judicial independence in Canada. Judicial independence is an unwritten norm, recognized and affirmed by the preamble to the Constitution Act, In fact, it is in that preamble, which serves as the grand entrance hall to the

5 castle of the Constitution, that the true source of our commitment to this foundational principle is located. PEI Reference, supra, Joint Book of Authorities, Tab 1 para In reply to the Government s paragraph 10, the Court in Bodner confirmed unequivocally that the principles stated in the Reference remain valid but went on to clarify the principles. The principles set out in both decisions, are discussed in the Association s Submission beginning at paragraph 63. Bodner, Joint Book of Authorities, Tab 2, para At paragraph 10, the Government suggests that the Supreme Court determined in Bodner that it would never be open to a Court to order implementation of a JCC s recommendations. The Court did emphasize that the remedies must be consistent with the role of the reviewing court and the purpose of the commission process and that the Court may not encroach upon the provincial legislature s exclusive jurisdiction to allocate funds from the public purse and set judicial salaries unless that jurisdiction is delegated to the commission. However, the Court went on to state that: if the commission process has not been effective, and the setting of judicial remuneration has not been depoliticized, then the appropriate remedy will generally be to return the matter to the government for reconsideration. If problems can be traced to the commission, the matter can be referred back to it. Should the commission no longer be active, the government would be obliged to appoint a new one to resolve the problems. Courts should avoid issuing specific orders to make the recommendations binding unless the governing statute gives them that option. Bodner, Joint Book of Authorities, Tab 2, para As the Manitoba Court of Appeal determined in its 2013 decision, [i]n exceptional circumstances, however, the typical remedy may not be appropriate. Steel J.A., writing for the Court, identified three scenarios in which an order for - 2 -

6 implementation was appropriate, rather than an order referring the matter back to Government for reconsideration: (a) where there is a lack of good faith on the part of government; (b) where, when up-to-date information is considered, the JCC s recommendations are properly considered to accord with the Government s objectives (the situation considered by the New Brunswick Court of Appeal in Provincial Court Judges Assn (New Brunswick) v. New Brunswick (Minister of Justice), 2009 NBCA 56); and (c) where a referral back to the Legislature would result in a significant delay in completing the constitutional process (e.g. in the Manitoba case, five years had passed since the outset of the JCC s mandate before the Court of Appeal considered the matter). Provincial Judges Assn of Manitoba v. Manitoba, 2013 MBCA 74, Joint Book of Authorities, Tab 9 at paras 149 to 162 CRITERIA (PARA 14) 8. At paragraph 14, the Government states that the criteria to be considered by this Commission are nearly identical to those considered by past Commissions. As such, the Commission can properly apply the reasoning of past JCCs in considering each of the criteria. 9. Consistent with its submission to the 2009 JCC, the Government states at paragraph 17 that each previous commission made recommendations based on extensive evidence and submissions by the parties. The degree to which past commissions received extensive evidence and submissions has varied quite significantly, depending on whether or not the Government and the Association were advancing a common position. Common positions were advanced by the Government - 3 -

7 and the Association to the 2000 and 2006 JCCs. The parties each presented much more comprehensive submissions to the 1998, 2003 and 2009 JCCs, and the positions advanced by the parties to those JCCs differed significantly. A detailed history of the past commissions is set out in the Association s Submission at paragraph 82 and following. 10. At paragraph 20, the Government suggests that the recommendations of the 1998 JCC were implemented over the Government s objections. To be clear, after finding that the Government had failed to explain rationally its reasons for rejecting the recommendations, the Court of Queen s Bench required that the recommendations be implemented, which order was confirmed by the Court of Appeal (with leave denied to the Supreme Court of Canada). Provincial Judges Association of Alberta v. Alberta, 1999 CarswellAlta 72, Joint Book of Authorities, Tab 4, para At paragraph 22, the Government states that the settlement agreement between the Association and the Government provided that the Government would pay the Association s costs incurred in respect of the 1998 Commission, an issue on which the 1998 Commission had been silent. In fact, the Framework Agreement which governed the 1998 Commission provided that the Government would pay the Association s reasonable costs, subject to two limitations: that the total payable by the Crown would not exceed $100,000; and that the legal fees of the Judges counsel would not exceed the tariff by which the Crown sets its fee for the private sector lawyers it retains. The settlement agreement referred to by the Government dealt with the costs related to the 1998 JCC over and above the amount provided for in the Framework Agreement, and the costs related to litigation, including both the Association s involvement in the PEI Reference case and the litigation which followed the 1998 JCC. Framework Agreement, appended to the 1998 JCC Report, Joint Book of Authorities, Tab 20, page

8 12. To clarify the Government s paragraph 23, the 2000 JCC recommended all of the changes to compensation jointly proposed by the Government and the Association. In addition, following a submission by an individual judge, the 2000 JCC recommended that Alberta judges be paid a professional allowance. 13. To clarify the Government s paragraph 31, the 2006 JCC recommended all of the changes to compensation about which the Government and the Association advanced common positions. It also recommended a change to the long term disability coverage in response to the submission of an individual judge. 14. At paragraph 36, the Government refers to its Submission to the 2006 JCC noting that it presented a comparison of the proposed salary for Alberta judges with the salaries of judges in other jurisdictions. The Government s position to this 2013 JCC is inconsistent with that which it advanced to the 2006 JCC. As it sets out in paragraph 36, the Government s position in 2006 resulted in Alberta s judicial salary being second only to the salary of federally appointed judges. 15. While the Government presented a comparison of judicial salaries to the 2006 JCC, and indeed urged that JCC to attribute considerable weight to the comparison, it also noted that the salaries of Ontario judges and of federally appointed judges in Alberta were not known for the years at issue. The Government s counsel stated: I will conclude the Government s presentation by saying that we re looking forward to having a very productive next three years and that we re proud of the compensation being paid to Alberta Judges, which will probably still leave them as the highest paid Provincial Judges in Canada. [emphasis added] Transcript of the 2006 JCC, Association s Book of Documents, Tab 4, page 23, lines 20 to As detailed below, the Government s approach before this JCC significantly departs from its position in 2006 and indeed from its approach in accepting the - 5 -

9 recommendations of the 2009 JCC. In 2006, Ontario and Alberta were more similar in terms of their economic and fiscal circumstances than is the case now. While Alberta had begun to pull away in respect of a number of key economic indicators, the pace of that pull quickened significantly in the years following This reality was accepted by the 2009 JCC (which sat in 2011), and was acknowledged by the Government before the 2009 JCC. The Government s proposal that Alberta judges salaries should now trail those of Ontario judges is inconsistent with the position it advanced in 2006 and its acceptance, in 2011, of the 2009 JCC s recommendations, and does not accord with the economic evidence which shows a further deterioration of Ontario s economy vis-àvis Alberta s since Transcript of the 2006 JCC, Association s Book of Documents, Tab 4, page 23, lines 20 to 27 Government s Response to the 2009 JCC, Tab 25, page The Government provides no explanation for these inconsistencies. Rather, it simply argues that this 2013 JCC should follow the reasoning of its predecessors. As we detail below, it mischaracterizes the findings of past JCCs through its presentation of the data in the form of historical percentage comparisons. 18. At paragraph 36, the Government also purports to set out the position taken by the Association in The position advanced by the Association to the 2006 JCC is discussed in the Association s Submission to this 2013 JCC, at paragraphs 97 and following. 19. At paragraphs 38-39, the Government refers to the submissions to and recommendations of the 2009 JCC. The 2009 JCC s recommendation to provide a full pension to any judge who has served for 25 years was made in response to the submission of an individual judge, Judge Cheryl Daniels. The Government declined to implement that recommendation, but did implement all the others. Government s Response to 2009 JCC, Joint Book of Authorities, Tab

10 APPLYING THE CRITERIA (PARA 40) Guarantee of Judicial Independence (para 40) 20. At paragraphs 40 to 47, the Government describes certain of the principles which it contends originate in Valente, PEI Reference and Bodner. The Association has described the governing principles in some detail in its Submission at paragraph 117 and following. 21. In reply to paragraph 41, the task of this 2013 JCC is to make recommendations regarding what compensation is appropriate for Alberta judges based on all of the criteria identified in the Commission Regulation, not to identify a range of constitutionally permissible compensation. As to the Government s paragraph 43, the Commission must not only be independent, but also objective and effective. 22. At paragraphs 42 through 47, the Government refers to the constitutional requirement that salaries must not fall below an acceptable minimum standard. No one suggests in this proceeding that judges compensation has fallen below that minimum standard such that the independence of the judiciary is threatened. That said, the task of this Commission is not to determine what that bare adequate minimum would be. Rather, this JCC must make recommendations about what is appropriate compensation in light of all of the criteria identified in the Commission Regulation. 23. The Association rejects the Government s characterization of the Supreme Court of Canada s decision in PEI Reference set out at paragraph 45 of its Submission, which it suggests provided for a constitutional range of judicial compensation. PEI Reference is not about a level or range of compensation that is necessary and appropriate for judges. It is about the process that must be followed for determining the compensation. In his reasons, Lamer CJC described the features of the institutional - 7 -

11 sieve - the independent, objective and effective commission that is necessary in order to depoliticize the setting of judicial compensation. PEI Reference, supra, Joint Book of Authorities, Tab 1, para As a separate feature of financial security, Lamer CJC also stated that it is a requirement of judicial independence that judicial salaries should not fall below a bare adequate minimum. He stated at the outset: I note at the outset that neither the parties nor the interveners submitted that judicial salaries were close to those minimum limits here. However, since I have decided to lay down the parameters of the guarantee of collective or institutional financial security in these reasons, I will address this issue briefly. PEI Reference, Joint Book of Authorities, Tab 1, para As to the Government s paragraph 50, where it is asserted that the salaries of private sector decision-makers are not suitable comparators, it is not clear who would constitute a private sector decision-maker, nor why the comparison is inappropriate. The Need to Maintain a Strong Provincial Court 26. At paragraph 51, the Government offers the bare assertion that the Minister s proposal will fully meet the need to maintain a strong court by attracting highly qualified applicants. The Government relies on the standard of excellence exhibited by judges appointed since April 2011 and also provides certain information about the number of approved candidates in each of 2011, 2012, 2013, and The Government s superficial analysis ignores the following points which were revealed in the Association s more detailed analysis of the data: (a) that the number of approved candidates is less than half the number that were approved in 2003; - 8 -

12 (b) that the proportion of approved candidates who originated from the private bar is declining; and (c) that the proportion of approved candidates who originated from the private bar is low when considered in the context of the proportion of the Bar as a whole who work in private law firms. Association Submission, paras 142 and following 27. The Association agrees with the Government s acknowledgement at paragraphs 52 and 54 that the Bench ought to be comprised of a balanced cross-section of Alberta s lawyers with a balanced proportion from the private, public and corporate sectors and that there ought to be a good cross-section of Alberta lawyers, with considerable variety in their professional practices. However, as set out in the Association s Submission at paragraph 167, 37.5% of judges appointed since January 1, 2011 worked for Government prior to appointment, three times the proportion of Government lawyers (12.9%) within the Bar as a whole. That is not a balanced crosssection. 28. Table 1, which spans pages 22 to 29 in the Government s brief sets out certain information about judges who were appointed between April 1, 2011 and July It must be presumed that the information in Table 1 does not conflict with the information set out in the Judicial appointments document attached as Tab 4 in the Joint Book of Agreed Facts and Exhibits. The latter covers a longer timeframe of December 2004 to September The Government asserts at paragraph 62 that there are a good number of recommended and highly recommended candidates, concluding that the present flow of excellent candidates remains strong. As discussed in the Association s Submission, the mere number of approved candidates does not speak to excellence. Further, the number of recommended candidates referred to in Tab 4 is cumulative year to year, in the sense that if an individual candidate is not appointed in a given year, he or she - 9 -

13 remains on the list. There is no way to know whether it was the highly recommended candidates who were appointed. Finally, when compared with the number in 2003, it is apparent that the flow has slowed significantly. If the Government is correct that the situation is unlikely to change, the numbers may decline even further. 30. At paragraph 63, the Government references the conclusions of previous Commissions that the salary gap should be narrow enough so as to not economically dissuade prospective judicial candidates from selecting the court to which they are best suited. The Government cited only the 2003 and 2006 Commissions for this point. To be clear, those JCCs relied in part on the Government s own submissions in coming to those conclusions. In that regard, the 2003 JCC stated: The Minister s submission also stated that the gap cannot be too wide JCC Report, Joint Book of Authorities, Tab 22, page JCC Report, Joint Book of Authorities, Tab 23, page Contrary to the Government s paragraph 64, which implies that the 2009 JCC took a different approach from its predecessors, the 2009 JCC stated: [o]ur salary recommendation is intended to preserve what we consider to be a suitable difference between salaries for judges of these courts. Indeed, as the 2009 JCC noted, the Government itself acknowledged the need to keep compensation competitive with the other courts and to avoid any economic disincentive to accepting an appointment to the Court for which the candidate is best suited JCC Report, Joint Book of Authorities, Tab 24, page The 2009 JCC s recommendations meant that Alberta judges were paid 94% and 93% of the salary paid to federally-appointed judges in 2009 and 2010 respectively. The salaries for federally-appointed judges for the years 2011 and following were not known to the 2009 JCC. This is what the 2009 JCC considered was a suitable difference in light of the circumstances considered by that JCC

14 33. The following chart compares the Government s proposals for Alberta judges salaries with the salaries that can be expected for federally appointed judges (based on the calendar year forecasts for the IAI-based adjustments obtained by Government, discussed below at paragraph 127 in this Reply. The Association s proposals are also so compared. s. 96 judges salaries GOA s proposal for Alberta salaries % of s. 96 salary Association s proposal for Alberta judges % of s. 96 salary 2013 $295,500 $266, % $275, % 2014 $300,800 $270, % $284, % 2015 $308,410 $277, % $294, % 2016 $316,491 $284, % $305, % 34. The Government simply asserts that its proposed compensation increase represents a reasonable balance between the relevant factors. It does not explain why it proposes to increase the gap with federal salaries significantly beyond what the 2009 JCC felt was a suitable difference in circumstances where it was tempering its recommendations. The Government s position is inconsistent with the reasoning of the 2009 JCC. 35. The position of the Government also fails to acknowledge that the judicial annuity is one of the most significant attractions to a federal appointment over a provincial appointment. The more advantageous features of the judicial annuity as compared with Alberta s judicial pension are described at paragraph 160 in the Association s Submission. Even if the salaries were the same, the gap in compensation would continue to be substantial. Historical Compensation Comparison (para 68) 36. At paragraph 68 and following, the Government embarks on what it indicates is an historical compensation comparison of Alberta judges with other Canadian

15 provincial court judges. As discussed below, this is a flawed approach to examining the data which fails to meaningfully consider the reasoning of past JCCs. 37. The Government correctly states at paragraph 68 that previous Commissions have accepted that a primary consideration in the determination of appropriate compensation is a review of comparable compensation paid to other judges. In fact, the Government itself submitted to past Commissions that they should consider compensation paid to other judges. As noted above, the Government indicated to the 2006 JCC that the Government s position placed considerable weight on the comparisons. Transcript of the 2006 JCC (excerpt only), Association s Documents, Tab 26, page 12, line While the Government argues that this 2013 JCC should follow the reasoning of past JCCs, the Government s position is not consistent with that reasoning. This is explained below. 39. At paragraphs 69 through 74, the Government sets out some statements made by each of the previous Commissions about comparisons with the compensation paid to judges in other jurisdictions. In its Submission, the Association provided detailed information regarding how past Commissions addressed the comparison with federally appointed judges at paragraph 225 and following, and with other provincial and territorial court judges at paragraph 235 and following. The Association addressed the comparison with Ontario, long considered the most appropriate other province with which to compare Alberta, at paragraph 238 and following. 40. Paragraph 74 contains a typographical error; paragraphs 75 and 76 of the Government s Submission are a quote from the 2009 JCC Report at page The Government purports to summarize the reasoning of the 2009 JCC on the judicial comparators in paragraphs 77 to 88. The analysis ignores that the 2009 JCC

16 considered the comparison with compensation paid to other judges in light of all of the relevant factors, including the strength of Alberta s economy. In considering whether it continued to be appropriate to maintain approximate parity with Ontario, the 2009 JCC compared the economies of each jurisdiction and the strength of their respective fiscal positions. It concluded: Ontario remains the most useful comparator among the other provinces and territories, but the McMillan Report demonstrates that the Ontario economy has fallen behind that of Alberta when measured by the key economic indicators 2009 JCC Report, Joint Book of Authorities, Tab 24, page As discussed in detail in the Association s Submission, the 2009 JCC also accepted the Government s argument that its recommendations should be tempered in light of the profound effect of the global recession on the economic conditions in Alberta and on the overall state of the economy including the financial position of Government. Even in those circumstances, the 2009 JCC concluded that it was appropriate to maintain approximate parity, as past JCCs had seen fit to do in the particular context in which they made their respective determinations JCC Report, Joint Book of Authorities, Tab 24, pages 25 and As to the Government s paragraph 83, no past JCC has determined that there ought to always be a gap between the salaries, or indeed in the compensation generally, of federally and provincially appointed judges. The suitable difference at a particular time depends on consideration of all of the factors (including most particularly the need to attract high quality candidates and the relative economic and fiscal capacity of Alberta and the federal government). 44. The Government correctly notes that the 2009 JCC took a made in Alberta approach. It properly considered all of the factors identified in the Commission Regulation and determined that it would temper its recommendations in light of the fact

17 that Alberta was in recovery mode at the time. The Association s proposal contemplates a similar tempering in 2013, in light of the fiscal condition of the province that year. The Government s proposal of CPI-based increases only is not consistent with the 2009 JCC s reasoning JCC Report, Joint Book of Authorities, Tab 24, page In reply to paragraphs 89-90, the 2009 JCC determined that it would adopt a method to protect judicial salaries against erosion from increases in the cost of living over the term that our recommendations are to address. Clearly, it contemplated a consideration of an adjustment at the end of its mandate, which goes to the salary proposed by the Association for But if the objective is simply to maintain judges purchasing power over certain years within a JCC s mandate, the Association agrees that a CPI-based adjustment is appropriate. However, for the reasons detailed in the Association s brief at page 86 and following, the Association proposes a different approach JCC Report, Joint Book of Authorities, Tab 24, page The adoption of the Alberta IAI as an adjustment mechanism for the fiscal years 2014 to 2016 would assist in depoliticizing the setting of judicial compensation by decreasing the likelihood that the next JCC would find it necessary and appropriate to recommend a significant increase at the outset of its mandate. It would also ensure that the incomes of judges, like the incomes of Albertans generally, would improve at a rate in excess of increases in the cost of living over the next few years. As such, it is properly considered to be a made in Alberta approach. 47. At paragraph 89, the Government argues that the adoption of CPI as an adjustment measure was a key part of reaching a distinctive made in Alberta decision. As the Association argued in its Submission, the adoption of the CPI adjustment factor was consistent with the 2009 JCC s decision that it was obliged to

18 temper its recommendations in light of the difficult fiscal conditions that were then present in Alberta. 48. As to paragraph 90, the use of the percentage change in the IAI for Canada as an adjustment factor to increase Ontario judges salaries is indeed set out in Regulation (the Ontario Framework Agreement). Ontario JCCs are nonetheless tasked with making recommendations about appropriate salaries and other benefits. Neither the Nairn nor the Kaplan Ontario JCCs saw fit to recommend any salary increase beyond the statutory IAI-based increases for the years 2007 and following. 49. As discussed at paragraph 280 in the Association s Submission, the purpose of the statutory adjustment was to maintain the remuneration paid to Ontario judges at a constant level. It is apparent that the notion of a constant level takes into account more than simply purchasing power, and must be viewed in relation to the various factors that are relevant to the setting of judicial compensation. As noted, successive JCCs in Ontario have considered what salary is appropriate in light of all the relevant factors and concluded that no further adjustments were required beyond the IAI-based increases for the years 2007 on. This can be seen as independent and objective confirmation of the appropriateness of the IAI as an adjustment factor that can approximate the impact of the various factors that are relevant in setting judicial compensation. 50. At paragraphs 97 to 99, and at Tab 4 to the Government s Submission, the Government calculates the historical ratio of Alberta judges salaries and the salaries of judges in each respective jurisdiction, the pre-2003 period (an arbitrary period), and over the mandates of each of the 2003, 2006, and 2009 JCCs. This approach of looking at the ratio over historical periods is not useful because it fails to consider the comparisons with the necessary context of the evidence considered by each JCC about all of the relevant factors, and the information that was available to the JCCs about the salaries in those other jurisdictions

19 51. The 2009 JCC rejected the historical average approach used by the Government at that time to formulate its salary position. The Government proposed to the 2009 JCC that, because Alberta judges salaries had been, on average, 95% of Ontario judges salaries in the period since 1998, the Alberta salary should be set at 95% of the salary of Ontario judges. After referring to changes in a number of the relevant criteria (including broad advances in public and private sector remuneration in 2006, 2007 and 2008), the 2009 JCC rejected the Government s argument. It determined: (a) [t]he notion of a persistent 5% gap in judges pay [was] not reflected in the recommendations of the past several Judicial Compensation Commissions ; and (b) [n]or is discounting pay for judges in Alberta compared with Ontario in keeping with what we perceive to be the relative economic standing of these two jurisdictions as it has evolved over the last decade or more JCC Report, Joint Book of Authorities, Tab 24, page The 2009 JCC earlier concluded in respect of the economic evidence before it: Ontario remains the most useful comparator among the other provinces and territories, but the McMillan Report demonstrates that the Ontario economy has fallen behind that of Alberta when measured by the key economic indicators JCC Report, Joint Book of Authorities, Tab 24, page The Government s continued reliance on its historical ratio approach in its presentation of the date effectively ignores the conclusion of the 2009 JCC that this is a flawed approach. Further, while the Government presents the data, it does not explain how its calculations support the Government s position that only a cost of living-based adjustment is appropriate in each of the four years at issue

20 54. At paragraph 100, the Government refers to the 2009 JCC s conclusions about the key trends it saw in the data regarding judicial compensation. The trend that was identified, of past JCCs more closely matching judicial pay between Alberta and Ontario over the last decade, reflected the gains that the Alberta economy made over the Ontario economy in that period. After considering evidence that showed that Alberta s economy had surpassed that of Ontario by a significant margin by 2011, and evidence about the profound effect of the global economic conditions on Alberta s fiscal position, the 2009 JCC concluded that it would temper its recommendations. Its tempered recommendations were for a salary that was higher than that of Ontario s judicial salary in 2009 and 2010 and slightly lower thereafter JCC Report, Joint Book of Authorities, Tab 24, pages 25 and 34 Federally Appointed Judges (para 101) 55. The Association does not propose that Alberta judges should be paid the same salary as federally appointed judges. As detailed in the Association s Submission at paragraphs 225 and following, the Association s proposed salaries take into account the reasoning of the 2009 JCC, which considered that its recommendations resulted in there being a suitable difference between the two salaries. This determination took into account all of the criteria identified in the Commission Regulation, not simply the work of the two Courts JCC Report, Joint Book of Authorities, Tab 24, pages The Government cites the 2003 JCC, which wrote that to recommend a salary already set by a federal commission would be tantamount to surrendering jurisdiction to a body responsible to Parliament and abdicating responsibility to make a decision faithful to local conditions. The Association agrees but notes that this works both ways. It is equally a surrendering of jurisdiction to find that the s.96 salary is a ceiling that the salary for Alberta judges cannot exceed. The appropriate level of compensation to be

21 paid to Alberta judges must be determined based on criteria set out in the Commission Regulation. Commission Regulation, Joint Book of Authorities, Tab 15, s At paragraph , the Government cites one paragraph from each of the 2005 Saskatchewan JCC and the 2001 Ontario Commission Reports. The rejection of the parity argument by those Commissions can be properly understood only in the context of all the evidence that was before those JCCs about the relevant factors. 58. At paragraph 106, the Government refers to the analysis of the New Brunswick Court of Appeal in one of the four cases that were ultimately considered by the Supreme Court of Canada in the Bodner decision. Contrary to the Government s assertion, the New Brunswick Court of Appeal did not judicially consider the argument that provincial court judges should be paid at par with federally appointed judges. The Court reviewed the legitimacy of the reasons offered by the New Brunswick government for rejecting the recommendations of the 2001 Judicial Remuneration Commission ( JRC ). 59. As the Supreme Court of Canada alluded to it in own decision, the Report of the 2001 JRC was poorly reasoned. The JRC essentially determined that because New Brunswick s personal income per capita amounted to 85% of the Canadian average, provincial judges salaries ought to be set at 85% of the salary paid to s.96 judges. The Government rejected this recommendation for a number of reasons which, with one exception, were ultimately upheld as legitimate by the Supreme Court of Canada. As the Court of Appeal pointed out in its decision, in a passage quoted by the Supreme Court of Canada, one difficulty with this type of analysis in New Brunswick, was that the federal salary level is set at a level which does not have a chilling effect on recruitment in the largest metropolitan areas of the country. Bodner, Joint Book of Authorities, Tab 2, para 82, paras

22 60. In upholding the Government s rejection of the JRC s salary recommendation as legitimate in accordance with the Bodner test, the Supreme Court of Canada explained: The role of the reviewing court is not to second-guess the appropriateness of the increase recommended by the Commission. It can, however, consider the fact that the salaries of federally appointed judges are based on economic conditions and lawyers earnings in major Canadian cities, which differ from those in New Brunswick. As a result, while the Commission can consider the remuneration of federally appointed judges as a factor when making its recommendations, this factor alone cannot be determinative. In fact, s.22.03(6)(a.1) of the Provincial Court Act requires the Commission to consider factors which may justify the existence of differences between the remuneration of Provincial Court judges and that of other members of the judiciary in Canada, yet the Commission chose not to address this. Moreover, it is inappropriate to determine the remuneration of Provincial Court judges in New Brunswick by applying the percentage ratio of average incomes in New Brunswick to those in Canada to the salary of federally appointed judges, because the salary of federally appointed judges is based on lawyers earnings in major Canadian cities, not the average Canadian income. Bodner, Joint Book of Authorities, Tab 2, para The Association s reliance on the salaries of s. 96 judges as one relevant consideration of many is entirely consistent with the reasoning of the Supreme Court of Canada in Bodner. It is also consistent with the reasoning of past JCCs in Alberta, including the two that have sat post-bodner (i.e. the 2006 and 2009 JCCs). 62. As noted, a significant consideration of the Court in Bodner was that federally appointed judges are paid the same salary across the country, a level that ensures the ability of the s.96 courts to attract applicants from Canada s large metropolitan areas. Lawyers in New Brunswick, on average, earn far less than lawyers in those major Canadian cities, which cities most certainly include both Calgary and Edmonton. As such, this criticism is without foundation in Alberta, where lawyers incomes are among the highest in Canada

23 63. As to the Government s paragraph 108, the Association rejects the assertion that there is a general consensus among JCCs across the country about the appropriate relationship between the salaries of Provincial Court judges in a given jurisdiction and the salaries of s. 96 judges. As a review of Tab 6 in the Joint Book of Agreed Facts and Exhibits reveals, the gap that exists in each jurisdiction varies quite considerably. 64. The Government acknowledges at paragraph 110 that there is no difference in the importance and value of the work performed by the two levels of Court, a reference to the Provincial Court of Alberta and the Alberta Court of Queen s Bench. Indeed, the Association maintains that the work of all of the courts in Alberta (i.e. including also the Court of Appeal, the Federal Court of Canada and the Tax Court of Canada) is properly viewed as complementary, a recognition that all play an essential role in the administration of justice. As set out in the Association s Submission, the common attribute of judicial temperament is required of judges of all the courts. 65. The Government argues that the unique nature of the judge s role is not meant to invite comparisons of the value of work done by various courts. The Association agrees and again notes the Government s acknowledgement of the equal value. The criterion does suggest that other judges are the best comparators for Alberta judges. This has been accepted by every previous Alberta JCC. 66. At paragraphs 111 to 116, the Government refers to the findings of past JCCs about how the salary of Alberta judges ought to compare with that of s.96 judges working in Alberta. A detailed comparison is presented at Tab 6 in the Association s Documents. The recommendations of each past JCC must be considered within the context of the evidence that was before it. For example, as noted above, the 2009 JCC recommended salaries that were 93% and 94% of the federal salaries at a time when it specifically indicated that it was tempering its recommendations in light of Alberta s fiscal situation JCC Report, Joint Book of Authorities, Tab 24 at page

24 67. The Government s argument that the JCC ought to maintain a gap that is based on an historical percentage calculated over particular years ought to be rejected for the same reasons that the 2009 JCC rejected the Government s salary proposal. As the 2009 JCC recognized, the use of historical percentages ignores the fact that the evidence relating to each of the criteria identified in the Commission Regulation changes over time. 68. At paragraph 117, the Government refers to the statutory IAI-based adjustments received by the federally-appointed and Ontario judges as a complicating factor when it comes to comparing the salaries. To the contrary, they make the comparisons easier. Increases implemented following the last two Federal and Ontario Commissions have been restricted to IAI-based increases. 4 As compared within Alberta, where the salary remained at $220,000 for five years before jumping to $250,000 in 2009, the consistent IAI-based increases are more predictable, making it easier to make comparisons. 69. At paragraphs 118 to 120, the Government refers to the reports it has included at its Tabs 8 and 9, about the state of Alberta s economy and its fiscal position. Apart from simply referencing the table of key economic indicators, the Government does not advance a position about the state of the Alberta economy or the Government s financial position and how the information supports its salary proposal. To be clear, to the extent that the Government may later take a position in this regard, the case law 4 This is a reference to the 2008 and 2012 Federal Commissions, and the Seventh and Eighth Triennial Commissions in Ontario. The 2008 Federal Block Commission recommended a fixed salary of $264,300 inclusive of IAI for April 1, 2008 with increases equal to the percentage changes in the IAI + 2% thereafter. The Government of Canada implemented only the IAI-based increases. The 2012 Levitt Commission recommended only the IAI-based increases. Despite that the Government of Canada had argued that the IAI-based increases should be capped at 1.5% (instead of the 7% set out in the Judges Act), it accepted the recommendations. In Ontario, the Nairn Commission, which had been delayed by Bodner and thus made recommendations spanning (the years of two regular triennial commissions), recommended only IAI-based adjustments for the years The Kaplan Report, which dealt with the years , also recommended no increase beyond the annual IAI-based adjustments

25 supports that it must advance those arguments before the 2013 JCC. If it chooses to leave it to the JCC, it must be prepared to accept the JCC s assessment. Provincial Judges Assn of Manitoba v. Manitoba, 2012 MBQB 79, Joint Book of Authorities, Tab 8, para The First Quarter Update and Economic Statement is the most recent statement from the Government about the economic situation in Alberta. At page 11, the Government trumpets: Alberta s economy is powering ahead after a strong 2013 Based on recent headway, economic growth in 2014 and 2015 is forecast to be slightly higher than the strong outlook at Budget First Quarter Update and Economic Statement, Joint Book of Agreed Facts and Exhibits, Tab 20 Real per capita income in Alberta (para 121) 71. Paragraphs 122 to 129 are a confusing discussion of the various statistics that are available to the Commission about the rising incomes of Albertans. Leaving aside the differences in what is measured by the different statistics, of significance is clearly the fact that the incomes of Albertans generally are rising at a rate that exceeds the rate of inflation. The Government does not explain how this data supports its position that judges should only receive an increase equal to the percentage increase in the CPI. 72. At paragraph 130, the Government wrongly asserts that there is no information set out in the McMillan Report regarding the changes in the incomes of Albertans. Figures 9 and 10 in that Report set out the increases that are forecast in both primary household income per capita and average weekly earnings respectively. Regardless, the information is provided in the Parsons & White report at Tab 8, page 3 in the Government s Documents, and that data is most up-to-date. McMillan Report, Association s Documents, Tab 10, pages

26 73. At paragraph 130, the Government appears to suggest that it is not open to this 2013 JCC to consider the Alberta income data relative to data about incomes in other jurisdictions. This position is inconsistent with the Government s earlier statement, at paragraph 14, that the criteria are nearly identical to those considered by the five previous Alberta Commissions. Further, it is inconsistent with the analysis of all past Commissions that comparisons with other jurisdictions are meaningful when made in the context of an economic comparison of the various jurisdictions. 74. In any event, s.13(k) of the Commission Regulation provides the Commission with broad discretion to decide what matters are relevant to its considerations. Commission Regulation, Joint Book of Authorities, Tab 15 The Need to Provide Fair and Reasonable Compensation in Light of Prevailing Economic Conditions in Alberta and the Overall State of the Economy, Including the Financial Position of Government (para 132) 75. The Government s paragraph 133 refers to a number of different figures from a variety of different sources. The key points include: (a) in 2013, there was an overall surplus of $755 million (change in net assets); (b) in 2014, the latest prediction (First Quarter Updated) is for an overall surplus of $1.4 billion; (c) for 2015, the 2014 Fiscal Plan forecast an overall surplus of $940 million; and (d) for 2016, the 2014 Fiscal Plan forecast an overall surplus of $2.6 billion. 76. While it appears that no revised forecasts have been released for the overall surpluses to be expected in 2015 and 2016, it seems reasonable to expect higher

27 figures than were originally predicted in the 2014 Fiscal Plan. This is because economic growth has exceeded the predictions available at the time those forecasts were prepared as part of Budget Government of Alberta First Quarter Fiscal Update and Economic Statement 2014/2015, Joint Book of Agreed Facts and Exhibits, Tab 20, page At paragraphs , the Government quotes selected excerpts from the McMillan Report which point to either downside risks in the economy or to Government s approach in dealing with the challenges that arose following the global recession. Those various points were all taken into account by Dr. McMillan in concluding that Alberta has an exceptionally strong economy and a remarkable fiscal capacity. McMillan Report, Association s Documents, Tab 10, page Paragraphs 136 to 139 make reference to cautionary notes that appeared in Budget 2014 documents. As noted above, the First Quarter Fiscal Update and Economic Statement is clear that economic growth exceeded the expectations that existed at the time that Budget was prepared. At paragraph 140, the downside risks noted in the First Quarter Fiscal Update and Economic Statement are also quoted, without reference to the balance of the report that takes those into account. The overwhelmingly positive report is entitled Strength across the board First Quarter Fiscal Update and Economic Statement, Joint Book of Agreed Facts and Exhibits, Tab 20, page At paragraph 142, the Government cites annual revenue figures which have increased from $35.01 billion in fiscal year 2010 to $45.2 billion in fiscal year While revenue fluctuates, the figures for any of these years would be envied by governments across the country. The Association relies on the balanced view

28 presented in the McMillan Report which points out the extraordinary strength of Alberta s economy and fiscal capacity, taking into account the downside risks. McMillan Report, Association s Documents, Tab 10 Cost of Living 80. Paragraph 144 contains an error in logic. It is accurate that s.13(h) of the Commission Regulation references the Alberta cost of living index and the position of the judges relative to its increases or decreases or both. However, this is only one factor of many that the Commission is mandated to consider. It does not follow from the reference to CPI in ss. 13(h) of the Commission Regulation that ultimate reliance should be placed on increases in the CPI, when considering how to adjust salaries in each of the four years within this 2013 JCC s mandate. In fact, the reference to CPI as only one of many factors suggests that ultimate reliance must be placed on all of the mandated considerations. The Association s proposal, of a fixed salary for 2013 followed by increases based on the percentage change in the IAI for Alberta, does just that JCC Report, Joint Book of Authorities, Tab 24, page 35 Alberta Consumer Price Index (para 147) 81. In reply to paragraphs 147 to 151, the Association takes no issue with the Government s argument that an annual CPI-based adjustment would maintain the purchasing power of judges salaries, over the course of this JCC s mandate. It further takes no issue with the 2009 JCC s conclusion that if judges salaries are to track changes in the cost of living, an adjustment based on the rate of inflation in consumer prices is appropriate. Commission Regulation, Joint Book of Authorities, Tab 15, s