Hamilton Unsuccessful in Opposing Community Mailboxes

We recently wrote about the impact on condominium corporations of Canada Post’s decision to phase out door to door mail delivery and replacing it with service to community mailboxes (“CMB’s”) (see Is Door-to-Door Mail Going the Way of the Dodo?). One of the key questions stakeholders are asking is what authority does Canada Post have to install these community mailboxes? This question is answered, in part, by the June 11, 2015, decision of the Ontario Superior Court of Justice in Canada Post Corporation v Hamilton, 2015 ONSC 3615. This case focused on the jurisdictional issue of whether or not the City of Hamilton (as a creature of provincial statute) had the authority to prevent the installation of CMB’s pursuant to Canada Post’s federal mandate.

We summarize the court’s factual findings as follows: the City of Hamilton passed a bylaw regulating the installation of CMB’s. The by-law created several obstacles to these installations. Canada Post was required to:

• obtain a permit for each CMB which was issued at the discretion of the City,
• pay an application fee of $200 per CMB, and
• wait 120 days after applying before installing any CMB’s.

Further to this bylaw, the City passed its resolution seeking to have City staff prepare a report to prevent the installation of CMB’s. Following this resolution, City staff stopped responding to Canada Post proposals for CMB locations pending the preparation of the report.

The reason put forward by Canada Post for installing the CMB’s was to be financially self-sustaining; given that door to door delivery was the most expensive form of delivery (about three times as expensive as CMB delivery). Moreover, the need to be self-sufficient was suggested to be pressing in an era of electronic mail and online ordering which increases the overall cost of postal operations.

The court found that there was no evidence that the locations proposed by Canada Post were actually viewed by the City. Canada Post sought to involve the City in deciding where to install CMB’s, but the City disengaged from consultation after its resolution. Accordingly, the court noted that it was disingenuous for the City to relinquish its first opportunity to consult and then pursue court proceedings.

The court held that the by-law was not valid for many reasons including:

1. The by-law was vague and lead to uncertainty – The by-law did not contain any specific standards to govern the location of CMB’s. Rather, it gave discretion to one of the city’s directors and provided no parameters as to how the discretion should be exercised. The by-law did not include any timelines for the director’s decisions. When standards were eventually adopted by the City, the language was generic and imprecise.
2. Municipalities are not permitted to pass by-laws that conflict with federal law – The court held that the by-law frustrated Canada Post’s purpose of delivering mail on a financially self-sustaining basis in a time sensitive way pursuant to the Canada Post Corporations Act and regulations. This was outside of the municipality’s authority under the Municipal Act.
3. A municipal by-law cannot regulate something within federal jurisdiction – the bylaw regulated the location of mailboxes which meant that it encroached on Canada Post’s federal mandate on how to deliver mail.

What lessons can we learn from this decision? Firstly, it is important to think about strategy when preparing for litigation. In this case, Hamilton disengaged from consultation with Canada Post, requiring Canada Post to commence a court proceeding to challenge the City’s by-law. At the same time, Canada Post made efforts to consult with the City even after the City disengaged. So what the City was seeking in court – determining the location of community mailboxes – is something that could have been achieved by way of consultation rather than court proceedings.

The second lesson is that the court was willing to recognize Canada Post’s legal authority to install community mailboxes on public land. The court was specifically dealing with Canada Post’s authority to install CMB’s on “a public road allowance or on lands associated with public parks, both lands being owned by the City”. It’s important to understand that this court case occurred in the context of a dispute between the City of Hamilton (wielding provincial power) and Canada Post (wielding federal power) and therefore is a jurisdictional dispute.

The practical implication for condominium corporations is that Canada Post can install CMB’s on municipally owned land. So, if the condominium property is subject to a municipal road allowance, or is adjacent to a public park, then Canada Post has the discretion to install CMB’s there.

But there remains the question of Canada Post’s authority in relation to privately owned condominium property. Although condominium corporations, like municipalities, are created pursuant to provincial statutes, they are created to manage the property and assets of the condominium corporation on behalf of the owners. Thus, condominium corporations govern private property. Our sense is that courts will be more reluctant to protect Canada Post’s discretion to install CMB’s private property where there is no municipal road allowance. 

All of the information contained in this article is of a general nature for informational purposes only, and is not intended to represent the definitive opinion of the firm of Elia Associates on any particular matter. Although every effort is made to ensure that the information contained in this newsletter is accurate and up-to-date, the reader should not act upon it without obtaining appropriate professional advice and assistance.

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