Requests for a record relating to superferry construction in the custody or under the control of the Job Protection Commission and the British Columbia Ferry Corporation

ISSN 1198-6182

Office of the Information and Privacy Commissioner
Province of British Columbia
Order No. 288-1999
January 12, 1999

INQUIRY RE: Requests for a record relating to superferry construction in the custody or under the control of the Job Protection Commission and the British Columbia Ferry Corporation

Note: The Director's report, containing the recommendations implemented in this order, is attached to, and forms a part of, this electronic document.

Fourth Floor
1675 Douglas Street
Victoria, B.C. V8V 1X4
Telephone: 250-387-5629
Facsimile: 250-387-1696
Web Site: http://www.oipc.bc.ca

1. Description of the review

This Order relates to an inquiry conducted by the Director of the Office of the Information and Privacy Commissioner (the Director) concerning two requests for review of decisions of the British Columbia Ferry Corporation and the Job Protection Commission to sever and withhold a report (the record) relating to the contract for the construction of two superferries. The Director also conducted a second inquiry concerning the same record, but involving a different applicant and the British Columbia Ferry Corporation.

I disqualified myself from this inquiry because of a personal interest. On April 7, 1998, I delegated authority to conduct reviews to the Director pursuant to Section 49 of the Freedom of Information and Protection of Privacy Act (the Act) which provides as follows:

Delegation by commissioner

49(1) The commissioner may delegate to any person any duty, power or function of the commissioner under this Act, except

(a) the power to delegate under this section,

(b) the power to examine information described in Section 12(1) and (2) or 15 (Cabinet confidences and information harmful to law enforcement), and

(c) the duties, powers and functions specified in Section 42(1)(b), 43 or 58.
(2) A delegation under subsection (1) must be in writing and may contain any conditions or restrictions the commissioner considers appropriate.

Although Section 49 authorizes delegation of authority to conduct inquiries under Section 56 of the Act, it does not authorize delegation of my authority to make orders under Section 58.

On May 14, 1998, the Director advised the applicants and the public bodies of the process to be followed:

I will be conducting this inquiry independent of the Commissioner who has disqualified himself from this matter because of personal interest. The Commissioner has had no involvement in the investigation or mediation of this matter and will have no involvement in the inquiry. He will be executing the order I recommend as a result of the inquiry, however,

because Section 49(1)(c) of the Act prohibits the Commissioner from delegating the authority to make orders under Section 58 of the Act.

No objections were raised to the process outlined in this letter.

The Director completed the inquiry and prepared a report, a copy of which is attached to this Order. I took no part in the inquiry or the preparation of the report. After receiving the Director's report, I reviewed the submissions and the record in dispute. I have adopted the Director's recommendations without variation in this Order.

2. Order

I accept the recommendations of the Director of the Office of the Information and Privacy Commissioner set out in the attached report and make the following Orders:

I find that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to withhold the information severed from Part 4 of the record under Section 13(1) of the Act. Under Section 58(2)(b) of the Act, I confirm that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to refuse access.

I find that the British Columbia Ferry Corporation and the Job Protection Commission were not authorized to withhold the information severed from page 10 of the record under Section 13(1) of the Act. However, I find that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to withhold the information severed from page 10 of the record under Section 17 of the Act. Under Section 58(2)(b) of the Act, I confirm that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to refuse access to the information severed from page 10 under Section 17 of the Act.

I find that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to withhold some, but not all, of the information severed from the record under Section 17 of the Act. The Director of the Office of the Information and Privacy Commissioner has prepared a severed copy of the record to indicate which information must be disclosed and which information may be withheld. Under Section 58(2)(a), I require the British Columbia Ferry Corporation and the Job Protection Commission to give the applicants access to those portions of the record which they are not authorized to withhold under Section 17 of the Act. Under Section 58(2)(b) of the Act, I confirm the decision of the British Columbia Ferry Corporation and the Job Protection Commission to refuse access to the remainder of the information withheld under Section 17.

I find that the British Columbia Ferry Corporation and the Job Protection Commission were required to withhold some, but not all, of the information severed from the record under Section 21 of the Act. The Director of the Office of the Information and Privacy Commissioner has prepared a severed copy of the record to indicate which information must be disclosed and which information must be withheld. Under Section 58(2)(a) of the Act, I require the British Columbia Ferry Corporation and the Job Protection Commission to give the applicants access to those portions of the record which they were not required to withhold under Section 21 of the Act. Under Section 58(2)(c), I require the British Columbia Ferry Corporation and the Job Protection Commission to refuse access to the remainder of the information withheld under Section 21.

David H. Flaherty
Commissioner

January 12, 1999

ISSN 1198-6182 [back to top]

Office of the Information and Privacy Commissioner
Province of British Columbia

January 12, 1999

REPORT BY THE DIRECTOR OF THE OFFICE OF THE INFORMATION AND PRIVACY COMMISSIONER: Requests for a record relating to superferry construction in the custody or under the control of the Job Protection Commission and the British Columbia Ferry Corporation

Fourth Floor
1675 Douglas Street
Victoria, B.C. V8V 1X4
Telephone: 250-387-5629
Facsimile: 250-387-1696
Web Site: http://www.oipc.bc.ca

REPORT BY THE DIRECTOR OF THE OFFICE OF THE INFORMATION AND PRIVACY COMMISSIONER

1. Description of the review

As Director of the Office of the Information and Privacy Commissioner, I have conducted a written inquiry under Section 56 of the Freedom of Information and Protection of Privacy Act (the Act). This inquiry arises out of two requests for review of decisions by the Job Protection Commission (the Commission) and the British Columbia Ferry Corporation (BC Ferries) to sever and withhold a record in response to the applicants' requests relating to the construction of superferries in British Columbia.

Another inquiry involves the British Columbia Ferry Corporation and the same record, but a different applicant. (See Order No. 289-1999, January 12, 1999)

2. Documentation of the inquiry process

On October 28, 1997 Levy-Russell Limited and Levy Industries Limited (the applicants) requested a copy of a report (the report) prepared in March 1994 by Harold Halvorson of the Office of the Job Protection Commissioner. The applicants directed their request for the report to BC Ferries and the Ministry of Employment and Investment. The title of the report is "Treatment of Integrated Ferry Constructors Inc. during Superferry Program," also known as the "Halvorson Report" and the "Fairness Report."

On December 17, 1997 BC Ferries responded by providing the applicants with a severed copy of the report. It severed information from the report under sections 13, 17, 21, and 22 of the Act. On December 22, 1997 the Job Protection Commission (via the Ministry of Employment and Investment) provided the applicant with the same decision and the identical severed record. The Ministry of Employment and Investment carries out, on behalf of the Job Protection Commission, the administrative processing of responses to requests under the Act for records in the custody or under the control of the Job Protection Commission. (Submission of the Job Protection Commission, p. 3) The Job Protection Commission is a public body listed in Schedule 2 of the Act.

On January 23, 1998 the applicants requested a review of the two disclosure decisions of BC Ferries and the Job Protection Commission. During mediation, BC Ferries and the Job Protection Commission agreed to disclose additional information from the report.

The applicants were not satisfied with the outcome of mediation and requested inquiries, for both requests, by the Information and Privacy Commissioner. By written
agreement of the applicants and the public bodies, the time limits for the two review files were extended to permit the inquiries to be held on May 26, 1998. On May 5, 1998 the Office of the Information and Privacy Commissioner gave notice to the parties of the May 26, 1998 written inquiries. The parties subsequently agreed to file submissions by June 16, 1998.

The public bodies severed portions of the record under Section 21 of the Act. However, the public bodies did not consult any third parties during the processing of the requests for the record, nor were they invited to participate in mediation. As well, the Office did not give any third parties standing to participate in the written inquiry.

3. Issues under review and the burden of proof

The issues to be reviewed by the Director of the Office of the Information and Privacy Commissioner are the decisions of the public bodies to apply Section 13 (policy advice and recommendations), Section 17 (financial or economic interests of the public bodies), and Section 21 (third-party business information) of the Act to sever information from the record. The decisions of the public bodies to apply Section 22 (third-party personal information) to the record are not under review in these two inquiries. See Order No. 289-1999, January 12, 1999, for a review of the application of Section 22 to the record.

The relevant parts of sections 13, 17, and 21 are:

Policy advice or recommendations

13(1) The head of a public body may refuse to disclose to an applicant information that would reveal advice or recommendations developed by or for a public body or a minister.

13(2) The head of a public body must not refuse to disclose under subsection (1)

(a) any factual material,
...
(g) a final report or final audit on the performance or efficiency of a public body or on any of its programs or policies,
...
(k) a report of a task force, committee, council or similar body that has been established to consider any matter and make reports or recommendations to a public body,....

Disclosure harmful to the financial or economic interests of a public body

17(1) The head of a public body may refuse to disclose to an applicant information the disclosure of which could reasonably be expected to harm the financial or economic interests of a public body or the government of British Columbia or the ability of that government to manage the economy, including the following information:

(a) trade secrets of a public body or the government of British Columbia;

(b) financial, commercial, scientific or technical information that belongs to a public body or to the government of British Columbia and that has, or is reasonably likely to have, monetary value;

(c) plans that relate to the management of personnel of or the administration of a public body and that have not yet been implemented or made public;

(d) information the disclosure of which could reasonably be expected to result in the premature disclosure of a proposal or project or in undue financial loss or gain to a third party;

(e) information about negotiations carried on by or for a public body or the government of British Columbia.
Disclosure harmful to business interests of a third party

21(1) The head of a public body must refuse to disclose to an applicant information

(a) that would reveal

(i) trade secrets of a third party, or

(ii) commercial, financial, labour relations, scientific or technical information of a third party,
(b) that is supplied, implicitly or explicitly, in confidence, and

(c) the disclosure of which could reasonably be expected to

(i) harm significantly the competitive position or interfere significantly with the negotiating position of the third party,

(ii) result in similar information no longer being supplied to the public body when it is in the public interest that similar information continue to be supplied,....

Section 57 of the Act establishes the burden of proof on the parties in an inquiry. Under Section 57(1) of the Act, where access to information in the record has been refused under sections 13, 17, and 21, it is up to the Job Protection Commission and BC Ferries to prove that the applicant has no right of access to parts of the record.

4. The record in dispute

The record in dispute is a fifty-three page report prepared in March 1994 by Harold Halvorson of the Office of the Job Protection Commission.

5. Procedural objections

None of the parties objected to the Director of the Office of the Information and Privacy Commissioner conducting the inquiry in this review and making recommendations to the Information and Privacy Commissioner.

There was an objection, however, concerning the submission of the in camera affidavit of Clive Bird. BC Ferries filed the affidavit of Clive Bird in camera because it felt that disclosure would lead to harm under sections 17 and 21 of the Act. The applicants contend that portions of the affidavit of Mr. Bird should be disclosed to afford them an opportunity to respond to the allegations contained therein. The applicants were particularly concerned about potential allegations in the Bird affidavit concerning their intentions, motives, and objectives in the Ontario court proceedings. Speculation regarding another party's intentions or motives does not constitute proper evidence. As most of the information in the Bird affidavit was contained in other affidavits, I placed minimal reliance on this affidavit and did not feel that there was any need for a response to this material from the applicants.

BC Ferries submitted a further affidavit from David Lindsay in reply, to address the question of whether Integrated Ferry Constructors Ltd. was ever directed to award a subcontract to Pacific Rim Ship Builders Ltd. The applicants contend that BC Ferries should have disputed this allegation in its initial submissions allowing the applicants the opportunity of reply. In my view, it is not necessary to determine whether BC Ferries "directed" Integrated Ferry Constructors Inc. to award a subcontract to Pacific Rim Ship Builders Ltd. in this inquiry. As such, I did not find it necessary to rely on the evidence contained in the affidavit from David Lindsay outlining the process for awarding subcontracts to Pacific Rim Ship Builders Ltd.

Background information

The Halvorson Report arose out of dealings between BC Ferries and Integrated Ferry Constructors Inc. in connection with BC Ferries' two "S" Class ferries, also known as the "superferries." In October 1990, BC Ferries entered into a shipbuilding contract with Versatile Pacific Shipyards Inc. (Versatile) for the construction of a superferry. That contract was soon afterward assigned by Versatile to a newly incorporated subsidiary, Integrated Ferry Constructors Inc., because of serious financial problems facing Versatile.

That shipbuilding contract called for the construction of two superferries for BC Ferries. Over the course of the next three-and-a-half years, Integrated Ferry Constructors Inc. completed both superferries. By the end of 1994, it was apparent that Integrated Ferry Constructors Inc. felt that BC Ferries should compensate it for a number of things and pay it some added costs. At this time, Integrated Ferry Constructors Inc. advanced a number of compensation claims to BC Ferries. The then Job Protection Commissioner, the late Douglas Kerley, retained Mr. Halvorson to look into the matter.

This inquiry stems from an access request made on behalf of Levy-Russell Limited and Levy Industries Limited (collectively "Levy-Russell"), a judgment creditor in Ontario of Shieldings Incorporated (Shieldings). Shieldings is a corporate affiliate of Integrated Ferry Constructors Inc., which constructed the two superferries for BC Ferries as described above. Coopers & Lybrand Limited (the Receiver) is the receiver of Shieldings Integrated Ferry Constructors Inc. and its corporate affiliates.

6. The applicants' case

Section 13: Policy advice or recommendations

The record in dispute deals with the consequences to Integrated Ferry Constructors Ltd. of a subcontract to Pacific Rim Shipbuilding Ltd. for the construction of the superstructure of the Queen of Vancouver Island and Queen of British Columbia ferries (now the "Spirit of Vancouver Island" and the "Spirit of British Columbia" respectively), which was directed by BC Ferries. (Submission of the Applicants, p. 1)

The applicants argue that, although little of the report appears to have been severed pursuant to Section 13 of the Act, none of it should have been severed under that section, since the broad application of Section 13(1) is narrowed and circumscribed by the exceptions contained in Section 13(2). (Submission of the Applicants, paragraph 24) The applicants argue that, first, Section 13(2)(a) prohibits the exclusion of any factual material. The applicants assert that, by necessary implication, this includes any conclusions derived from such factual material. Second, the report should be considered to be the final report on the performance of BC Ferries with respect to its contracts with Integrated Ferry Constructors Inc. and with respect to its superferry program, and therefore should not be severed, by virtue of Section 13(2)(g). Third, the report should be considered to be a report within the meaning of Section 13(2)(k). Mr. Halvorson, as a consultant to the Job Protection Commission, was commissioned to prepare the report to make recommendations to BC Ferries with respect to the superferry program and Integrated Ferry Constructors Inc.'s directed subcontracts to Pacific Rim Ship Builders Ltd. His work is thus the report of a "similar body" to a task force or committee commissioned for that purpose. (Submission of the Applicants, paragraphs 25-28)

Section 17: Disclosure harmful to the financial or economic interests of a public body

The applicants state that much of the report is severed under Section 17 of the Act. However, the applicants submit that disclosure of the report could not reasonably be expected to harm the financial or economic interests of the public bodies or the government of British Columbia. They also submit that the report does not constitute "information about negotiations" carried on by or for the public bodies or the government of British Columbia within the meaning of Section 17(1)(e). In fact, the report was commissioned to avoid the harm to the financial or economic interests of the public bodies or the government of British Columbia that would have resulted from the contractual audit of Pacific Rim Ship Builders Ltd.'s work to which Integrated Ferry Constructors Inc. was entitled.

The applicants contend that the purpose, intent, and content of the report are "fairness." It is not the purpose or intention of Section 17 to authorize the concealment by public bodies of information concerning whether they have dealt fairly with the public. It is not the intent of the preamble to Section 17 nor of Section 17(1)(e), to cloak in secrecy information or conclusions about what is fair to parties with whom public bodies do business. (Submission of the Applicants, paragraph 32)

The applicants contend that no reasonable interpretation of Section 17 can conclude that the financial or economic interests of a public body can be harmed by disclosure of conclusions about what would be fair conduct on the part of the public body. (Submission of the Applicants, paragraph 33)

Section 21: Disclosure harmful to business interests of a third party

The applicants state that Section 21 does not have any application to the report.

The applicants point out that, for Section 21 to apply, the report must reveal commercial, financial, or labour relations information of the third party, supplied in confidence, and its disclosure must reasonably be expected to either harm significantly the competitive position, or interfere significantly with the negotiating position, of the third party, or result in undue financial loss or gain to any person or organization.

The applicants submit that the only third party relevant to its request is Integrated Ferry Constructors Inc., which was established to carry out the superferry construction program and which is no longer in business. Integrated Ferry Constructors Inc. cannot be harmed within the meaning of Section 21(1)(c).

Furthermore, the applicants rely on paragraph 17 of the Bennett Affidavit which confirms that the report may support the view that the fair and reasonable settlement value of Integrated Ferry Constructors Inc.'s claim is more than four times the amount proposed in current proceedings. Far from harming the financial or economic interests of Integrated Ferry Constructors Inc., disclosure of the report is sought for the purpose, and may have the effect, of benefitting those interests.

Finally, the applicants contend that the report was not supplied in confidence, as required by Section 21(1)(b). It was commissioned and distributed to ensure fairness on the part of the British Columbia government and its public bodies. (Submission of the Applicants, paragraphs 35-39).

7. BC Ferries' Case

Section 13: Policy advice or recommendations

BC Ferries states that the amount of information severed and withheld under Section 13 of the Act is relatively minimal. It has withheld only certain portions of the recommendations set out on page 7 of the report. BC Ferries released certain of the recommendations set out on page 7, either because the recommendations had already been implemented or because BC Ferries considered that disclosure was otherwise acceptable.

Section 17: Disclosure harmful to the financial or economic interests of a public body

BC Ferries states that a public body need not prove that harm will with certainty flow from disclosure under Section 17. It need only establish a reasonable expectation of harm. In this case, BC Ferries contends that it has established a reasonable expectation that Levy-Russell will - regardless of the merits of the Halvorson Report - use the information contained in the portions of the report that it has withheld to impugn the settlement agreement in the Ontario court proceedings initiated by the Receiver to obtain court approval of that agreement.

BC Ferries points out that it has incurred transaction costs in reaching an agreement with Integrated Ferry Constructors Inc. and the Receiver in terms of staff time spent, both in assessing Integrated Ferry Constructors Inc.'s claims and in negotiating a settlement. BC Ferries also points out that it incurred legal costs for representation on Integrated Ferry Constructors Inc.'s claims and the negotiation, settlement, and court approval of the Settlement Agreement.

BC Ferries contends that the evidence establishes a reasonable expectation that, if the report is released in its entirety, the applicants will likely use it in an attempt to destroy a settlement agreement.

Section 21: Disclosure harmful to business interests of a third party

BC Ferries states that the evidence establishes that it severed and withheld information that relates to commercial transactions entered into by, and commercial activities of, Integrated Ferry Constructors Inc. and other third parties. BC Ferries states that the evidence also establishes that this information was supplied to Halvorson in confidence for the purposes of the report.

BC Ferries' original decision focused on the issue of significant harm to the competitive position of Integrated Ferry Constructors Inc., in whose shoes the Receiver now stands. BC Ferries recognizes that the Information and Privacy Commissioner's recent decision in Inquiry Re: A Request for Records from the Real Estate Council (Order No. 230-1998, April 27, 1998) indicates that where a third party is insolvent and has ceased trading, the criterion of significant harm to the competitive position of such a third party will be very difficult, if not impossible, to satisfy.

BC Ferries states that the evidence establishes a reasonable prospect of harm to the negotiating position of Integrated Ferry Constructors Inc., as represented by the Receiver, in dealings with Levy-Russell.

BC Ferries further states that Section 21(1)(c)(ii) applies in this case, since the information supplied to Halvorson was received in confidence and he was retained by the Job Protection Commissioner under the Job Protection Act. BC Ferries submits that, since the supply of information to the Job Protection Commission or person acting under its authority is voluntary, it is reasonable to expect that disclosure of the information in issue here will result in such information no longer being supplied to that public body.

8. The Job Protection Commission's case

The Job Protection Commission adopts the submissions of BC Ferries in relation to sections 13, 17, and 21 of the Act.

The Commission submits that the argument and evidence presented by BC Ferries clearly discharges the burden of proof on the public bodies to establish that they are authorized under sections 13 and 17, and are required under Section 21 of the Act, to refuse access to parts of the report which they are refusing to disclose to the applicant.

Under the Job Protection Act there are no powers to compel the participation of a business in the services offered by the Commission. Since participation by business and industry is entirely voluntary, the Commission submits that it is imperative that confidential business information remain confidential. Otherwise, businesses will be unwilling to supply this information to the Commission for fear that it will end up in the hands of competitors or other parties adverse in interest. The Information and Privacy Commissioner, in Order No. 187-1997, August 21, 1997; and in Order No. 220-1998, March 31, 1998, recognized and upheld the application of Section 21(1)(c)(ii) in regard to confidential third party business information which was voluntarily supplied to a public body, and where the continued supply of similar information was in the public interest.

The Commission submits that, given the express protections of the Job Protection Act and the sensitive nature of the business information supplied to it, it is reasonable to assume that businesses supply this information with the full expectation of confidentiality.

The Commission submits that, if third party business information supplied to it in confidence (such as the information which has been withheld under Section 21 in this case) is later required to be disclosed under the Act, this disclosure could reasonably be expected to result in similar information no longer being supplied to the Commission.

9. Discussion

I agree with the applicants in their reply submission that "the policy of the Act supports disclosure, rather than concealment, of documents held by Public Bodies. The exceptions in the Act should be narrowly construed and interpreted, and applied only where policy requires nondisclosure."

Section 13: Policy advice or recommendations

The majority of the information withheld under Section 13 of the Act is contained under the Job Commissioner's "recommendations" in Part 4 of the report. Although I agree that most of the information withheld from Part 4 of the report constitutes recommendations for the purposes of Section 13(1), there are two sentences which are more properly characterized as findings or expressions of opinion. However, disclosure of these sentences would implicitly reveal the recommendations contained in Part 4 and were thus properly withheld.

Since the sentences in question constitute recommendations or would implicitly reveal recommendations, I conclude that Section 13(2)(a) does not apply to them. These sentences do not constitute "factual material" in the sense contemplated by this subsection.

The applicants contend that Section 13(2)(g) applies because the report is a "final report or final audit on the performance or efficiency of a public body or on any of its programs or policies." Although it is arguable that the report was concerned with the "performance" of BC Ferries with respect to its program for superferries, in my view, it is more accurate to characterize the record as a report on the complaint of a private corporation concerning its treatment by a public authority under a contract. I conclude that the report does not fall within the scope of Section 13(2)(g).

It is also my view that Section 13(2)(k) does not apply. It provides that the head of a public body must not refuse to disclose "a report of a task force, committee, council or similar body that has been established to consider any matter and make reports or recommendations to a public body." Mr. Halvorson was not commissioned to make recommendations to BC Ferries. He was the principal of H.N. Consultants Ltd., a company retained by the Job Protection Commissioner to provide a report on the treatment of Integrated Ferry Constructors Inc. Nor does the Job Protection Commission constitute a similar body that has been "established" for the purpose of considering Integrated Ferry Constructors Inc.'s complaint. I conclude that the report does not meet the statutory requirements of Section 13(2)(k).

As none of the exceptions in Section 13(2) apply, I find that the recommendations and statements which would implicitly reveal those recommendations in Part 4 of the report were properly withheld under Section 13(1). However, I find that one sentence withheld from page 10 of the report was not properly withheld under Section 13(1), but can be withheld under Section 17.

Section 17: Disclosure harmful to the financial or economic interests of a public body

The public bodies withheld the majority of the report under sections 17 and 21 of the Act. BC Ferries has argued strongly that the information cannot be released, as financial harm will flow to it in two ways. First, there are the costs already associated with negotiating the settlement, which will be lost if the agreement is not finalized. Second, BC Ferries contends that future costs will likely be incurred, if the settlement already reached is not approved by the Ontario Court. There is much speculation on the part of BC Ferries as to what use the applicant will put the report, and that, if it is presented to the Ontario Court, the settlement will not be approved.

While costs have clearly been incurred in reaching agreement on the amount of the settlement, many of these costs would have necessarily related to the investigation of Integrated Ferry Constructors Inc.'s numerous monetary claims. Not all of those costs will be thrown away, in the sense that much of the information gleaned from the investigation will be used in subsequent negotiations or litigation, should that prove to be necessary. The point should also be made that the settlement has not yet been finalized. Although the parties have agreed on a monetary amount, approval from the Ontario Court is still necessary before the settlement is complete.

The second argument is a more difficult one. There is clearly speculation by all parties. BC Ferries does not know what the applicants or the Ontario Court will do with the report. The applicants do not know whether the contents of the report justify support for, or opposition to, the proposed settlement. Under Section 17, BC Ferries must establish a reasonable expectation of harm, which imports a higher standard than a mere "possibility" of harm. The Act is meant to hold public bodies accountable, and Section 17 should not be used to protect them from "possible" harm or embarrassment.

I accept that BC Ferries has established the likelihood that the applicants will oppose Court approval of the settlement, but that in itself does not establish a reasonable expectation of harm to the financial or economic interests of the public body. The reasonableness of the expectation turns on the nature of the information contained in the report. The nature of the information may have some bearing on whether the Ontario Court will approve the settlement agreement and, if not, whether the withholding of approval will ultimately lead to a higher settlement or judgment.

Although I agree that there is a reasonable expectation of harm based on the nature of some of the material withheld under Section 17, I place little weight on BC Ferries' contention that it will not have the opportunity to rebut the information contained in the report in the proceedings before the Ontario Court. As the applicants point out, BC Ferries could apply for standing to make submissions to the Ontario Court on the contents of the report.

Having regard to the broad arguments advanced by BC Ferries concerning the reasonable expectation of harm, I reviewed each of the statements withheld under Section 17 to determine whether disclosure of each statement could reasonably be expected to harm the financial or economic interests of the public body or the government of British Columbia. I accept that there was a reasonable expectation that disclosure of some of the statements could reasonably be expected to harm the financial or economic interests of BC Ferries. The statements withheld are related either to financial information generated by the public body, or to information concerning allegations against officers of BC Ferries. However, I also find that it refused to disclose more than was justified under that section. Much of the information simply relates to claims made by Integrated Ferry Constructors Inc., which may or may not have any factual or legal validity. As a result, it will be my recommendation that the head of BC Ferries be ordered to give access to part of the information withheld under Section 17.

Section 21: Disclosure harmful to business interests of a third party

The public bodies rely on Section 21 to withhold information in relation to Integrated Ferry Constructors Inc. and other third parties. I propose to deal first with the information relating to Integrated Ferry Constructors Inc.

I accept that the information withheld under Section 21 in relation to Integrated Ferry Constructors Inc. would reveal "commercial" or "financial" information of a third party under Section 21(1)(a). It also appears that the information was supplied in confidence under Section 21(1)(b). However, BC Ferries cannot establish the third branch of the test under Section 21(1)(c) in relation to Integrated Ferry Constructors Inc. As the Commissioner concluded in Order No. 230-1998, where a third party is insolvent and has ceased trading, the criterion of significant harm to the competitive position of such a third party will be very difficult, if not impossible, to satisfy. I agree with the applicants that, where Integrated Ferry Constructors Inc. is insolvent, no longer in business, and without directors, the disclosure of its commercial or financial information, whether or not supplied in confidence, for the purpose of protecting its claims, cannot reasonably be considered to be contrary to the provisions of Section 21(1). As the three-part test in Section 21(1) is conjunctive, the section cannot apply where the public authority fails to establish the third branch of the test.

I also do not accept the Job Protection Commission's contention that the third party business information must be withheld because disclosure could reasonably be expected to result in similar information no longer being supplied for the purposes of Section 21(1)(c)(ii). Although the Job Protection Commission relied on the confidentiality provisions in the Job Protection Act in support of this argument, these provisions only govern confidentiality for the Commission and its staff; they cannot be used to impose a mandatory statutory confidentiality upon that information when an access request is made.

In my view, the application of Section 21(1)(c)(ii) turns on the purpose and nature of the Job Protection Commission's role in the investigation of Integrated Ferry Constructors Inc's complaint. The report was commissioned to address the complaint by Integrated Ferry Constructors Inc. that it had not been treated fairly in the superferry construction program. This was not a case where the Commission was attempting to minimize job loss of a business experiencing financial difficulty or to preserve, restore, or enhance the competitiveness of a business enterprise in British Columbia. The Commission's involvement related to a specific complaint of unfairness by a company which stood to benefit from participating in the study. The company is no longer in business. I conclude that the Job Protection Commission has not established that disclosure of the information in these unique circumstances could reasonably be expected to result in similar information no longer being supplied to the public under Section 21(1)(c)(ii).

With regard to the small amount of third party business information that does not relate to Integrated Ferry Constructors Inc., I agree to its withholding since this information meets the three-part test under Section 21(1).

10. Recommendations

I recommend that the Information and Privacy Commissioner find that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to withhold the information severed from Part 4 of the record under Section 13(1) of the Act, but not authorized to sever the information from page 10 of the record under Section 13(1). However, I recommend that the Information and Privacy Commissioner find that the information severed from page 10 of the record was properly withheld under Section 17 of the Act.

I recommend that the Information and Privacy Commissioner find that the British Columbia Ferry Corporation and the Job Protection Commission were authorized to withhold some, but not all, of the information severed from the record under Section 17 of the Act. I have provided the Information and Privacy Commissioner with a severed copy of the record to indicate which parts I recommend cannot be withheld under Section 17.

I recommend that the Information and Privacy Commissioner find that the British Columbia Ferry Corporation and the Job Protection Commission were required to withhold some, but not all, of the information severed from the record under Section 21 of the Act. I have provided the Information and Privacy Commissioner with a severed copy of the record to indicate which parts I recommend cannot be withheld under Section 21.

I further recommend that the Information and Privacy Commissioner require the British Columbia Ferry Corporation and the Job Protection Commission under Section 58(2)(a) of the Act to provide the applicants with a copy of the record that I have marked for disclosure and have given to the Information and Privacy Commissioner.

Lorrainne A. Dixon

Director
January 12, 1999

Report by the Director of the Office of the
Information and Privacy Commissioner of British Columbia
See Order No. 288-1999, January 12, 1999