Justice Tom Bingham defined the Rule of Law as follows:
"The core of the ... principle is ... that all persons and authorities within the state, whether public or private, should be bound by and entitled to the benefits of laws publicly made ... and publicly administered in the courts."
Hon. Eugene A. Forsey explains this principle in How Canadians Govern Themselves this way:
It means that everyone is subject to the law; that no one, no matter how important or powerful, is above the law — not the government; not the Prime Minister, or any other Minister; not the Queen or the Governor General or any Lieutenant-Governor; not the most powerful bureaucrat; not the armed forces; not Parliament itself, or any provincial legislature.
The classic illustration of this concept in action is Roncarelli v. Duplessis,  S.C.R. 121.
The facts are truly disturbing. Frank Roncarelli was a successful restaurant owner and practicing Jehovah's Witness in
He was very active in the Jehovah's Witness community and used his wealth to
support persecuted members by offering bail security for those who had been
arrested by the municipal government.
At the time, sometimes violent tension between the dominant Roman Catholic community and the Jehovah's Witness community saw increasing arrests of Jehovah's Witness members for giving out copies of their magazines. Roncarelli furnished bail for over 375 Jehovah's Witness members in three years and many were arrested multiple times.
The Chief Prosecutor of the city, Oscar Gagnon, overwhelmed by the number of Witnesses being arrested and then set free by Roncarelli's intervention, contacted the Premier who spoke to Edouard Archambault, Chairman of the Quebec Liquor Commission. Roncarelli's liquor licence was subsequently revoked.
Roncarelli received news of the revocation in December 1946, and while he tried to keep his business open without the licence, it was not profitable and he put it up for sale within six months. Consequently, he brought an action against Duplessis for $118,741 in damages.
The Supreme Court held that, while the province was within its power to revoke liquor licences at its discretion, it must do so in accordance with the Rule of Law. Mr. Justice Rand held that in public regulation there is no such thing as absolute and untrammelled “discretion.” Specifically:
“…Discretion” necessarily implies good faith in discharging public duty; there is always a perspective within which a statute is intended to operate; and any clear departure from its lines or objects is just as objectionable as fraud or corruption. Could an applicant be refused a permit because he had been born in another province, or because of the colour of his hair? The ordinary language of the legislature cannot be so distorted.
Because the only reason to revoke the licence was a personal animus related to Roncarelli’s actions, the discretion was improperly exercised and illegal.