Background
Companionship of the Sacred Vine Inc. (CSV) is a religious organization practicing Axeti Nete, a Shipibo religion involving ayahuasca ceremonies. CSV obtained section 56(1) exemptions under the Controlled Drugs and Substances Act to import and use ayahuasca for religious purposes—first in July 2023, then amended in November 2023. Both exemptions were time-limited, expiring December 23, 2025. In November 2024, Health Canada issued a notice of intent to revoke the exemption, citing YouTube videos and website content suggesting CSV intended to use it for purposes beyond the stated religious practice, contrary to public health and safety objectives.
CSV challenged the revocation decision by judicial review, arguing the Minister lacked statutory authority to revoke a granted exemption under section 56(1). CSV also raised Charter-based objections regarding liberty, freedom of religion, and freedom of expression, and contended the revocation process violated procedural fairness. Health Canada defended the revocation as within the Minister’s inherent discretionary powers and justified on changed circumstances.
By the time of hearing in February 2026, the exemptions had naturally expired on December 23, 2025. Both parties agreed the issues were moot but asked the court to exercise its discretion to decide, at minimum, the central jurisdictional question of whether the Minister could revoke a granted exemption—a question they contended would guide future practice and avoid future litigation.
The Court’s Holding
Justice Pallotta dismissed the application as moot without deciding the substantive issues. The court applied the two-part test from Borowski v. Canada (Attorney General): first, whether a live controversy remains, and second, whether the court should exercise discretion to decide despite mootness. The court found no live controversy because both exemptions were independently spent through natural expiration, irrespective of the revocation decision.
Although the parties requested the court exercise discretion to rule on the jurisdictional question, Justice Pallotta declined. The court found no meaningful adversarial context remained: CSV’s intention to reapply for a future exemption did not give it “a stake in the outcome” of whether the Minister could revoke a past exemption. Any refusal of a future application would raise different issues than the lawfulness of revocation. The court was also concerned that granting a declaration in the absence of a live controversy would not settle a practical dispute and risked the court overstepping its proper adjudicative role by pronouncing on hypothetical disputes.
The court noted that even though both parties sought guidance and raised concerns about avoiding future litigation, these factors did not outweigh the principle that courts should refrain from deciding moot questions outside an active dispute. Justice Pallotta emphasized that permitting courts to resolve hypothetical disputes risks intruding into the legislative branch’s proper role. Each party bore its own costs.
Key Takeaways
- A proceeding becomes moot when no live controversy remains between the parties at the time of decision, even if one existed when the proceeding was commenced.
- Agreement between parties that an issue is moot does not bind the court; courts retain discretion whether to hear moot issues and often decline to do so.
- A party’s intention to pursue future relief (e.g., reapply for an exemption) does not automatically create sufficient adversarial context to justify deciding moot issues from past disputes.
- Courts will not grant declarations lacking practical utility to settle an actual live controversy, even when such guidance might benefit future practice.
- The revocation authority question—central to CSV’s challenge—remains unresolved on the merits.
Why It Matters
This decision reinforces the mootness doctrine as a threshold safeguard in Canadian judicial review, preventing courts from pronouncing on hypothetical or spent disputes. Although the parties sought judicial guidance on the Minister’s authority to revoke discretionary exemptions under section 56(1), the court prioritized adherence to the principles of justiciability and the court’s proper adjudicative role over providing legal clarity. The ruling illustrates the tension between ensuring predictable guidance on important administrative questions and maintaining courts’ institutional limits.
For organizations seeking exemptions under the Controlled Drugs and Substances Act, the decision leaves unresolved whether Health Canada can revoke or revisit exemptions once granted based on changed circumstances or misuse. CSV’s core argument—that revocation power is not conferred by section 56(1)—was not adjudicated, leaving regulatory authority on this point unsettled. Future applicants challenging exemption decisions will need to mount challenges while exemptions remain in force to avoid mootness dismissals.