The constitutionality of these provisions were challenged as ultra vires of the federal government as it created civil remedy and cause of action for tort and contractual matters which is generally under the power of the provincial authority over property and civil rights.
[1] The Federal Court of Appeal upheld the provision as valid under the Trade and Commerce power.
Chief Justice Laskin, writing for the Court, found that the provisions encroached upon the province's authority over property and civil rights and could not be upheld under the trade and commerce branch.
Laskin proposed a three-stage test for the "general trade" branch.
[1] Laskin's proposed three-stage test was later modified by General Motors v. City of National Leasing (1989) with two supplementary stages: Fourth, the scheme is of a nature that the provinces would be constitutionally incapable of enacting it; and fifth, failure to include one or more provinces or localities in the scheme would jeopardize its operation in other parts of the country.