The legislation is meant to codify the laws of the applicable jurisdiction and provide guidelines and rules for courts, and society at large. However, despite best efforts on the part of those who drafted the documents, sometimes the meaning of certain clauses can be interpreted in more than one way. Sometimes this is a result of wording being outdated or overly complex (the dreaded “legalese”), particularly in the case of older laws. In these instances, courts are often left to interpret the laws themselves and apply them to the situation at hand. Judicial interpretation of statutes will then act as precedent on lower courts, providing additional guidance in the common law.

Courts & Statutory Interpretation

How do courts read and interpret legislation? The usual first step has been to consider the “ordinary meaning” of the words used in the statute. In other words, what meaning comes to mind as a result of the ordinary meaning of the words used?

A more modern approach, described as the “contextual and purposeful” approach, is to view the circumstances before the court and then approach the statue holistically. This necessarily involves an understanding of far more than the ordinary meaning of the words used. Under this approach, a judge will ask questions such as:

• What was parliament’s intention in passing the statute?
• What is the context in which the statute operates?
• What is the history and object of the Act?

This new approach is based on the reasoning of the Supreme Court of Canada (SCC) in Rizzo & Rizzo Shoes Ltd. (1998). As stated in that case:

At the heart of this conflict is an issue of statutory interpretation.  Although the plain language of ss. 40 and 40a of the ESA suggests that termination pay and severance pay are payable only when the employer terminates the employment, statutory interpretation cannot be founded on the wording of the legislation alone.  The words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.  Moreover, s. 10 of Ontario’s Interpretation Act provides that every Act “shall be deemed to be remedial” and directs that every Act shall “receive such fair, large and liberal construction and interpretation as best ensures the attainment of the object of the Act according to its true intent, meaning and spirit”.

The Core Message of the Modern Approach

The core message of the new modern approach is that the language of any statute must always be interpreted purposefully and in context. The wording of the legislation alone is insufficient to effect this goal. The words must be read and analyzed with a purposeful analysis. Why was the legislation written and enacted? What were the drafters trying to achieve? One must also keep in mind all of the rules, principles and maxims that might apply.

When the “Ordinary Meaning” Approach Was Insufficient

In Rizzo, the issue was whether the employer had to pay termination pay under the Employment Standards Act (ESA). The employer had not terminated the employee. The employee was terminated at law following the bankruptcy of the employer. The Ontario Court of Appeal (ONCA) found that the plain meaning of the words used meant that the employer did not have any termination obligations under the ESA. The SCC found the opposite. They accepted that the ordinary meaning test could lead to the same result. However, the SCC looked at the factors mentioned above and concluded that the employer did have termination obligations.

In Oakville (Town) v. Clublink Corporation ULC (2019) The owners of a large golf course intended to develop the property into a residential and mixed-use community. The Township rejected the owners’ development application and ultimately passed a by-law designating the course as a cultural heritage property under section 29 of the Ontario Heritage Act (OHA). The dispute involved the meaning of the word “structure” as used in the OHA. That issue was critical as it would determine the application and appeal procedure to be used by the owners. One route provided for an appeal, the other did not.

 The majority of the ONCA held that words in an Act which at first reading appear clear and unambiguous may become vaguer when considered in context. Moreover, textual interpretations of legislation have their limits. If a word in a statute has more than one “ordinary meaning” in common usage, problems arise. In such cases, Courts have no choice but to consider these words in the broader context of the statute as a whole. Common usage leads the Court to a dead end, requiring recourse to other avenues. This approach led the ONCA to find that the golf course was a “structure” on designated property within the meaning of Section 34 of the OHA which did provide an appeal route.

The ONCA and the SCC have not abandoned textual literalism but rather relegated it to one aspect of statutory interpretation. The other factors mentioned above must also be considered in the analysis.

At Milosevic & Associates, our team of Toronto corporate commercial lawyers regularly represent clients in complex commercial litigation matters ranging from straightforward contract and partnership disputes to complex multi-party commercial claims including class action litigation.

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