Decision No. 150-R-1994
April 12, 1994
IN THE MATTER OF an agreement between the Canadian National Railway Company and Canadian Pacific Limited which provides that the Canadian National Railway Company will convey by sale to Canadian Pacific Limited the segment of its Weyburn Subdivision from mileage 13.37 to mileage 39.6 and the segment of its Bengough Subdivision from mileage 0.0 to Willow Bunch (mileage 71.5); and Canadian Pacific Limited will convey by sale to the Canadian National Railway Company the segment of its Meadow Lake Subdivision from Debden (Tobey) (mileage 0.0) to Meadow Lake (mileage 93.4), in the province of Saskatchewan, pursuant to section 158 of the National Transportation Act, 1987, R.S.C., 1985, c. 28 (3rd Supp.).
File Nos. T 6135/717
T 6140/142
INTRODUCTION
On November 23, 1993, the Canadian National Railway Company (hereinafter CN) and Canadian Pacific Limited (hereinafter CP) gave notice in writing to the National Transportation Agency (hereinafter the Agency) of an agreement dated October 27, 1992 to convey by sale segments of their respective lines pursuant to subsection 158(2) of the National Transportation Act, 1987 (hereinafter the NTA, 1987).
The agreement provides that CN will convey by sale to CP the segment of its Weyburn Subdivision from mileage 13.37 to mileage 39.6 and the segment of its Bengough Subdivision from mileage 0.0 to Willow Bunch (mileage 71.5); and CP will convey by sale to CN the segment of its Meadow Lake Subdivision from Debden (Tobey) (mileage 0.0) to Meadow Lake (mileage 93.4). Maps for the lines of railway subject to the conveyance agreement are included as Appendices A and B.
According to CN and CP, the conveyance of their respective lines is necessary in order to improve the productivity of rail operations in the province of Saskatchewan.
Pursuant to the terms of the agreement, the conveyance of the subject lines shall include the right-of-way together with trackage and associated railway-owned land, the assignment of all property leases and agreements affecting the lands to be transferred and to which the transferring railway company is a party, and all assets and non-surplus fixtures. It shall not include mines, minerals and land legally or beneficially owned by any person, firm or corporation that is not a party to the agreement. The bunkhouse located at Radville on the CN Weyburn Subdivision is excluded from the transfer as are any communication towers and associated facilities for train to wayside communications for the CN Weyburn and Bengough Subdivisions.
By letter dated December 3, 1993, the Agency directed CN and CP to serve copies of the public notice of the agreement on interested parties and publish the notice in specific local area newspapers. CN and CP served copies of the notice on interested parties on January 26, 1994 and the notice was published in local area newspapers on January 28, 29, 30 and 31, 1994 and on February 3 and 7, 1994. Interveners were given until March 9, 1994 to file submissions with the Agency.
In response to the notice, the Agency received one submission. By letter dated February 22, 1994, the Government of Saskatchewan filed an intervention and interrogatories with the Agency. The Government of Saskatchewan notes that CP has been operating rail services on the CN Weyburn and Bengough Subdivisions for some time as has CN on the CP Meadow Lake Subdivision. It submits that an offence as described in section 182 of the NTA, 1987 was committed if CN and CP have been operating these services without any approval from the Agency.
Further, the Government of Saskatchewan is of the opinion that the approval of the conveyance agreement is detrimental to the public interest if all practical aspects have been implemented prior to the notice of the agreement and before affected parties have had an opportunity to be heard.
The Government of Saskatchewan states that "It is inconsistent with the purpose and intent of section 158 of the NTA, 1987 that the section be utilized to approve an arrangement which has been implemented by CN and CP contrary to this section or other provisions of the NTA, 1987 or the Railway Act."
The Government of Saskatchewan requested that the conveyance agreement not be processed until there has been an appropriate review of the preceding operations.
By letter dated March 2, 1994, the Agency required CN and CP to respond to the issues addressed in the interrogatories of the Government of Saskatchewan.
By letters dated March 7, 1994, CN and CP confirmed that since August 1, 1990 CN has been providing rail service on the subject segment of the CP Meadow Lake Subdivision and CP has been providing service on the subject segments of the CN Weyburn and Bengough Subdivisions. Although no statutory authority has been granted to them, CN and CP implemented these arrangements under a Letter of Intent and Joint Operating Agreement dated July 19, 1990.
In response to the interrogatories, CP noted that the conveyance would not affect the current operations of either railway company. CP submits that prior to August 1, 1990, only boxcars could be loaded on the subject lines. CN and CP have since upgraded the lines to hopper car standards. CP submits that without these changes this gain in efficiency for grain shippers would not have been possible.
CONCLUSIONS
Subsection 158(3) of the NTA, 1987 provides that:
Within six months after the receipt of a notice under subsection (2), the Agency shall, after holding such hearings, if any, as are required in its opinion to enable all persons who wish to do so to present their views on the conveyance of the line of railway or segment, approve the agreement for the conveyance unless the Agency determines that the conveyance would not be in the public interest or that the company to whom the line or segment is to be conveyed is not authorized to operate it.
After consideration of all material received and on file, the Agency has concluded that a public hearing is not required and that a decision can be made based on the information on file.
The Agency notes that the Government of Saskatchewan states that an offence, as described in section 182 of the NTA, 1987, was committed. Subsection 182(1) of the NTA, 1987 provides:
Every person who contravenes or fails to comply with any provision of this Part [III] or any regulation or order made under this Part is guilty of an offence punishable on summary conviction.
The Agency has considered the request of the Government of Saskatchewan to delay the processing of the conveyance agreement until there has been a review of the operations of CN and CP.
CN and CP have confirmed that they have voluntarily entered into an agreement to operate over each other's lines of railway. Voluntary agreements are entered into pursuant to section 98 of the Railway Act, R.S.C., 1985, c. 28 (3rd Supp.) and/or section 23 of the Canadian National Railways Act, R.S.C., 1985, c. C-19. Accordingly, the Agency has concluded that since neither of these sections are contained in Part III of the NTA, 1987, section 182 of the NTA, 1987 does not apply. Consequently, no offence as described in section 182 of the NTA, 1987 was committed.
The Agency has also considered the position of the Government of Saskatchewan that the approval of the conveyance agreement would be detrimental to the public interest if all practical aspects have been implemented prior to the notice of the agreement and before affected parties have had an opportunity to be heard. The Agency has noted that no shippers filed submissions with the Agency.
Accordingly, after review of the matter, the Agency has concluded that there is no evidence to indicate that the proposed agreement would not be in the public interest.
The Agency is also satisfied that CN and CP have the authority to operate the subject lines of railway.
DETERMINATION
Accordingly, pursuant to subsection 158(3) of the NTA, 1987, the Agency hereby approves the agreement between CN and CP which provides that CN will convey by sale to CP the segment of its Weyburn Subdivision from mileage 13.37 to mileage 39.6 and the segment of its Bengough Subdivision from mileage 0.0 to Willow Bunch (mileage 71.5); and CP will convey by sale to CN the segment of its Meadow Lake Subdivision from Debden (Tobey) (mileage 0.0) to Meadow Lake (mileage 93.4), in the province of Saskatchewan.
Further, CN and CP are required to advise the Agency in writing of the date upon which the conveyance transactions have been completed.
- Date modified: