Appeals decisions over the years show that government contracts are not private
Published on December 14, 2023
The Globe and Mail’s Secret Canada investigation revealed a litany of issues with the country’s broken freedom of information system. Institutions were regularly violating their legislated time limits, overusing redactions and failing to conduct proper searches for records. But one of the most troubling findings was the fact that public institutions are regularly refusing to release information that judges and appellate body adjudicators have determined are unquestionably public.
The best example is government contracts. The need for transparency when it comes to how much public money is being spent and which businesses and people are getting these funds is obvious. Time and time again, legal bodies have said that this information must be released. In fact, best practice would be to follow the U.S. model, where state, federal and municipal contracts are often proactively published online.
But in Canada, even through the use of FOI, some institutions are refusing to disclose them. In an interview with The Globe, a former Ontario information and privacy commissioner, Brian Beamish, explained that during his tenure with the IPC, which ended in 2020, adjudicators were regularly being asked to review contract denials.
“We would consistently order them to be disclosed. We would be upheld by the courts. This is established law. Not just by us, but by the courts as well. But ministries continued to deny,” Mr. Beamish said.
While reporting on Secret Canada, we decided to test this claim. We filed FOI requests for public contracts between municipalities and a private garbage collection company in the cities of Windsor and Halifax.
Windsor completely denied our request, citing an exemption that protects business trade secrets. The Halifax Regional Municipality replied to us stating it would release the contract, but it had notified GFL — the garbage contractor — of its intention to do so, and the company had filed an appeal. The backlog in Nova Scotia is four years.
FOI laws give third parties such as businesses the right to be notified before a release and the right of appeal if they believe private information about them should not be disclosed. But a contract is not private, say the courts and FOI appellate bodies across the country. Mr. Beamish explained to The Globe that there may be situations in which it would be appropriate to consult a business before a release, such as if the contract is extremely detailed and would reveal a trade secret that could harm the company’s competitive position. But the total amount of the contract and scope of work is not a trade secret.
(A distinction that numerous officials made to The Globe was this: If a public institution has a contract with Coca-Cola to supply soda to the cafeteria, the amount the institution is paying and the scope of the work is public. If the contract includes the recipe for Coca-Cola, that’s private.)
And yet some institutions keep refusing to release public contracts to Canadians.
If you’ve encountered this issue, I don’t know if it will help, but below are some examples of appeals decisions that deal with contracts.
Nova Scotia highway corporations contracts ordered released, 1997
In this case, the Supreme Court of Nova Scotia was asked to consider whether a provincial contract to build a public-private toll highway should be released. The province agreed to release the information, but the contracted private companies — Atlantic Highways Corporation and Atlantic Highways Management Corporation — appealed. In his decision, Justice F.B. William Kelly had this to say:
“Throughout this appeal runs the basic debate as to whether a contract negotiated by a government authority can be kept from the public because the release of it might cause significant harm to the other contracting party. The Review Officer in his written reasons for his recommendation concluded that a private company cannot expect to keep private the information contained in an agreement signed with government, particularly when public funds are involved. I confess to some difficulty with this broad statement as there may be rare circumstances where it could be in the public interest to do so. For example if such a contract also involved other protected information of the Act such as certain personal information. However, the general statement is valid in most circumstances as it reflects the right of citizens to be informed of the use of public funds. The obvious danger is the use of the protection of ‘commercial information’ as a shield to keep from the public the information necessary to properly assess government acts… The past decisions of this jurisdiction and other jurisdictions have supported the basic purpose of this legislation, to provide protection to certain specified information that deserve privacy, and then to ensure the public has the information necessary to make an informed assessment of the performance of its government institutions.”
The government was ordered to release the contract.
Ontario court upholds an Information and Privacy Commissioner decision, 2011
In 2011, the Ontario Superior Court of Justice’s Divisional Court heard a case brought forward by the City of Vaughan. Vaughan asked for a judicial review of a decision made by Ontario’s Information and Privacy Commissioner. An individual had filed a municipal freedom of information (MFIPPA) request with the city for invoices submitted by a city employee for his use of the 407, a privately owned toll highway north of Toronto. While this case doesn’t pertain to a government contract, it does include this helpful quote:
“The overarching goals of transparency and accountability of the MFIPPA confirm our determination of the Commissioner's decision as reasonable. By ordering the disclosure of the redacted information, the Commissioner's decision directly reveals the government's expenditure of taxpayer money. Such disclosure holds the government accountable to its constituents and adds greater transparency to its internal budgetary processes, thus upholding the goals of the MFIPPA.”
The records were ordered released.
Records concerning government approvals are not confidential, 2005
While not a contract issue, this federal court decision considered the extent to which a private company doing business with government is entitled to confidentiality. The case concerned an access request to the Minister of Health for records that dealt with an AstraZeneca Canada drug submission. In ordering the documents disclosed, the judge noted:
“Parties seeking government approvals, just as parties seeking government funds or contracts, cannot expect the same degree of confidentiality as a party who is assisting government. This is particularly the case where the approvals relate to people's health and physical well being.”
ESDC ordered to release improperly exempted contract records, 2022
In this case, an individual filed an appeal with the federal Office of the Information Commissioner, alleging that Employment and Social Development Canada (ESDC) had improperly withheld records in response to their request for information related to a specific contract. ESDC had denied portions of the requested records based on subsection 19(1) (personal information), paragraph 20(1)(c) (financial impact on a third party), paragraph 21(1)(b) (accounts of consultations or deliberations), section 23 (solicitor-client and litigation privilege), and subsection 24(1) (disclosure restricted by another law) of the Access to Information Act. The OIC ordered that many of the contested records be released.
This case is not particularly special, but it’s included as a recent example of a refused-contract-appeal win. It unpacks many of the issues around whether information contained in a contract would put a company at a competitive disadvantage.
Decisions from information commissioners and appeals bodies
An Ontario school board ordered to release contract with consulting firm, 1994
It’s an oldie but a goodie. An appellant filed a MFIPPA request with the East Parry Sound Board of Education in Ontario for access to a contract between the board and a consulting firm. The board denied access. The assistant commissioner ordered the document released.
Business dealings with public sector are subject to transparency and accountability, 2016
In this file out of New Brunswick, an appellant filed a request for a copy of a contract with a company that provides orthopedic prostheses. Horizon Health Network denied the request, stating “the contract would contain sensitive commercial information.” The requester appealed and won.
In recommending that the records be released, the commissioner wrote:
“Given the overall financial value of contracts of this nature, it is unlikely that sellers will be disinclined to continue to seek out public sector business opportunities. Furthermore, the disclosure of contracts, including pricing information, may have the effect of encouraging sellers to be more competitive with their pricing and delivery of goods or services. In addition, sellers who conduct business with the public sector need to be made aware of the transparency and accountability obligations that public bodies have about how they spend public funds.”
An Alberta commissioner agreed detailed financial breakdown can be exempted, 2006
In Alberta, an individual filed an FOI request for a copy of a report prepared by KPMG and the total cost of the report. The report was in draft form. Alberta Finance refused to disclose the report (citing an exemption that provides “advice” to government), but it did release the total cost. However, it refused to provide a breakdown of the amount, citing it would reveal personal information.
In this case, the commissioner agreed. “In my view, the financial accountability for public bodies, as mandated by section 17(2)(f), requires disclosure of who is supplying the services, what services the person is supplying, and how much that person is being paid for supplying the services.” This is an example of a case where the total amount is fair game, but certain sensitive financial information within some contracts may not be subject to disclosure.
A B.C. health authority's housekeeping contracts are public, 2008
A British Columbia union filed an access request for “renewed or newly signed contracts, including amendments, appendices and schedules” between the Fraser Health Authority and a private company for housekeeping services for FHA hospitals. Some of the information was withheld, and the union successfully appealed.
Said the commissioner: “One of FIPPA’s twin purposes under s. 2(1) is to make public bodies “more accountable to the public” by “giving the public a right of access to records,” a goal that is further advanced by “specifying limited exceptions to the rights of access” to information in FIPPA. The force of the right of access in s. 4 is reinforced for all non-personal information in contracts with public bodies by the fact that s. 57 puts the burden of proving the applicability of s. 17 or s. 21 on the public body or the third party contractor, not on the access applicant. Public body accountability through the public right of access to information is acutely important and especially compelling in relation to large-scale outsourcing to private enterprise of the delivery of public services, in this case aspects of hospital care.”
This case also spends a lot of time going through the financial harms argument that private companies may make if they are trying to block access.
B.C. commissioner rules contract disclosures won't stifle competition, 2010
This case pertains to an FOI request filed by the Freedom of Information and Privacy Association (FIPA) and the British Columbia Government and Service. The groups were after a copy of a contract between the province and a private company relating to services connected to the Medical Services Plan and the PharmaCare Plan.
A quotable quote from the decision:
“FIPA makes a valid point when it states that, despite numerous cases in which claims for disclosure of negotiated contracts have been denied, the Ministry does not point to any instance where a public body could say it got a worse deal the next time a deal was negotiated or that its negotiating expenses increased significantly because of the disclosure… As FIPA pointed out, the Ministry’s concern about disclosure leading to a diminishing pool of contractors who are willing to bid is at odds with Maximus’s arguments about the highly competitive nature of the government outsourcing industry. Contractors are well aware that the government pays in full and on time. In a competitive climate, contractors are in my view more likely to submit better priced, more attractive bids, in order to succeed over their competitors. This can only benefit the government, not harm its financial interest.”
The ministry was ordered to release the information.
Saskatchewan commissioner affirms default is disclosure not secrecy, 2010
Both the above British Columbia decisions are cited in this case from Saskatchewan involving a request for a contract between the Saskatoon school board and a taxi company. It’s common (especially for smaller jurisdictions) to look to other provinces for guidance on how certain provisions of an access law should be considered.
“The default is disclosure not secrecy as our highest court clarified in 1993. Although the Court was dealing with FOIP and not LA FOIP, I find that the quote is fully applicable to local authorities. Information relating to the expenditure of public funds can only be withheld if the local authority can establish on a balance of probabilities that one or more of the limited and specific exemptions apply. I have no hesitation in finding that none of the four exemptions cited by the Board apply to shield those portions of the contract that the Board withheld from public scrutiny.”
Laval University catering contract appeal useful case study in economic risk exemptions, 2008
Laval University in Quebec received an access request for a copy of the contract between the university and a private company hired to provide catering services to the campus. It was denied, and the requester appealed. During the hearing, the school and company agreed to provide some sections of the document. The applicant partially won.
The case is helpful in that it unpacks some of the economic risk exemptions that third parties may want applied. (The name and numbers of the exemptions vary in each jurisdiction, but in general, they are very similar across the country.) For example, Section 21 in Quebec protects information that would likely give an unfair advantage or seriously harm the economic interests of a public institution. To this, the adjudicator cited Tremblay v. Société Générale de Financement du Québec, where the Court of Quebec wrote that the third party “must therefore demonstrate in a credible manner that one of the impacts provided for in these articles is likely to occur or be realized in the event of disclosure of the information in dispute. The Court is of the opinion that the mere possibility of hypothetical damage to the reputation of SGF cannot justify the application of sections 21 and 22 of the Access Act.” Speculation of impact is not enough.
There is also helpful analysis around the use of section 24 – a public body can’t reveal information that would “hinder a negotiation with a view to concluding a contract, cause a loss to that third party, or provide an appreciable advantage to another person or substantially harm the competitiveness of this third party” – in which the adjudicator considered Cégep Lévis-Lauzon et Bell Canada. In that case, the commissioner wrote:
“Indeed, the evidence heard convinces us that the disclosure of the content of these sections, namely, the services offered by Bell Canada in terms of labor and training to users, and Bell Canada's policy in terms of service and maintenance would likely provide an appreciable advantage to any other company working in the telephony sector during possible tenders, within the meaning of article 24 of the law.”
A proactive approach in Ontario
Ontario’s information commissioner has a guide on contracts, in which it urges public institutions to proactively disclose contract documents. “Almost inevitably, the appeal process results in the IPC ordering the disclosure of the contract, generally based on the grounds that contracts are negotiated, not supplied – an approach that has been repeatedly upheld by the courts.
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