Privatization and the boundaries of judicial review

Abstract

Can a public authority avoid public law requirements, such as an obligation to act fairly, by “contracting out” the performance of its functions? In Société de l'assurance automobile du Québec v. Cyr, the Supreme Court of Canada said “no,” but it did not explain how far the Court will move the boundaries of judicial review to adapt to the growth of the private role in governance. However, there is reason to believe that the Court is moving towards a functional approach in defining state power and the location of the boundary between public and private law. This promises to be more coherent and effective than the piecemeal functional approaches that have emerged in the United States and the United Kingdom. A functional approach will prevent the lines of legal accountability to Parliament, the legislatures, the electorate and the courts from being severed by a contract between a public authority and a private party. At the same time, the emerging functional approach accepts that public law remedies should generally not be available if private law offers an adequate remedy or if applying public law would generate disproportionate costs to efficiency or would damage other public law objectives or private interests.