A few months prior to the Lac-Mégantic tragedy, amendments to the Railway Safety Act came into force, empowering cabinet to implement Administrative Monetary Penalties (“AMPs”) as a Transport Canada enforcement tool. Draft enabling regulations were released on May 16, 2004 for a thirty-day period of public review and comment.

Regulators have increasingly accepted AMPs as an efficient and cost-effective means of enforcement. Something less than offences dealt with by the laying of charges leading to prosecution in the courts, penalties are an administrative mechanism that can be applied when routine inspections detect contraventions of the legislation at hand. A notice alleging violations is usually issued to the violator, setting out the contraventions and the assessed penalties, which are determined based on the seriousness of the penalty, the violator’s compliance history, its ability to pay etc. There is usually a review or appeal mechanism in place by which the violator can seek to have the alleged violations rescinded and/or the assessed penalties reduced. Legislation frequently provides for a further right of appeal to the courts, or, at, least, judicial review of the initial review.

Because the penalties are administrative as opposed to penal in nature, the procedural protections contained in the Charter do not apply, or, at least, are substantially limited. This means that there is no need for a trial requiring that the Crown prove the violations beyond a reasonable doubt, avoiding the procedural and evidentiary difficulties that can entail. Instead, the violator is provided with the right to a hearing, written or oral, on the merits of the allegations, in addition to other safeguards provided by the doctrine of procedural fairness.

The draft AMPS categorize violations into three categories according to risk (low, medium and high) to public safety arising from the consequences or potential consequences of the violation.  The proposed maximum penalties for a corporation are $25,000, $125,000 and $250,000, respectively, for each day the violation continues or occurs. Penalties proposed for individuals are $5,000, $25,000 and $50,000, for each day a violation continues or occurs. Presumably other criteria will be published and implemented by Transport Canada to assess penalties within these maximums that take into account the circumstances of each violator.

The draft AMPS make no provision for any defences that may be available to violators. As an example, the AMP regime enforced by FINTRAC provides that due diligence, in addition to a variety of other common law defences, are available to violators. Absent similar provisions in the draft AMPs, the single defence available to an alleged violator would be restricted to the violation did not occur, or, referencing the burden and standard of proof on Transport Canada, the Crown cannot establish on a balance of probabilities that the violation occurred. Other AMP regimes, such as that in Ontario’s Environmental Protection Act, have taken this approach. Objectionable in principle, perhaps, but, without recourse to Charter protections, probably not unlawful.

Here is the Regulatory Impact Statement for the draft AMPs. Comments on the draft will be considered prior to releasing the final AMP regulations.