Le Corre v. Canada (Department of Human Resources Development), 2004 FC 155

Date: 20040204

Docket: T-317-03

Citation: 2004 FC 155

Between:

ANDRÉ LE CORRE

Applicant

And:

THE ATTORNEY GENERAL OF CANADA

and

DEPARTMENT OF HUMAN

RESOURCES DEVELOPMENT CANADA

Respondents

REASONS FOR ORDER AND ORDER

HUGESSEN J.

[1]        The Court has before it a motion to bring a class action, pursuant to Rule 299.18(1) of the Federal Court Rules, 1998, against the respondents based on the latter's failure to use tax information in possession of the Canada Customs and Revenue Agency (the CCRA) to inform elderly persons who were potentially eligible for the Guaranteed Income Supplement (the Supplement) of the conditions of eligibility for that benefit, an omission allegedly a breach of section 15 of the Canadian Charter of Rights and Freedoms (the Charter).

[2]        The Department of Human Resources Development (the Department) is responsible for administering the Old Age Security Act, R.S.C. 1985, c. O-9 (the Act) and the income security programs mentioned therein. The provisions of that legislation cover the Old Age Security Pension program, which includes as benefits the Old Age Security Pension (the Pension) and the Supplement.

[3]        The Pension is universal in nature and is paid to persons 65 years of age and older who apply for it and meet the requirements of the Act. The Supplement is a monthly payment added to the Pension, which is available to persons 65 years of age and older with low incomes who apply for it and meet the requirements of the Act.

[4]        In December 2001, the House of Commons Standing Committee on Human Resources Development and the Status of Persons with Disabilities (the committee) published a report titled The Guaranteed Income Supplement: The Duty to Reach All (the report).

[5]        In that report the Committee recommended inter alia that the Department and the CCRA continue to work together to identify and directly contact elderly persons who might be eligible for the Supplement.

[6]        In February 2002, the CCRA, using tax information obtained from tax returns pursuant to the Income Tax Act (the I.T.A.), identified elderly persons who were potentially capable of applying for the Supplement and forwarded the information to the Department. The latter used this information to start a campaign to increase the rate of participation in the Supplement program by sending out 105,000 simplified supplement applications.

[7]        Following the sending out of these simplified Supplement applications an initial motion for leave to bring a class action was filed by the applicant in the Quebec Superior Court, first to recover the amounts representing the Supplement to which he was allegedly entitled since 1994 (he has withdrawn this motion), and then to obtain compensation under section 24 of the Charter for a breach of section 15.

[8]        On February 20, 2003, Capriolo J. allowed the motion to dismiss and for a declinatory exception made by the Attorney General of Canada and concluded that Parliament had created a complete system of control over pensions and the Federal Court was the efficient and proper forum for arguing this question.

[9]        On June 5, 2003, the applicant filed a motion in this Court to bring a class action.

[10]      The applicant maintained he had been eligible for the Supplement since 1994 and had not received it until March 2002. He claimed he had refrained from applying between 1994 and 2002 because he thought he was not eligible, as he did not know he did not have to include the amount of his pension in calculating his income to determine his eligibility for the Supplement.

[11]      The applicant argued that he could have obtained the Supplement from 1994 to 2002 if he had made an application to that effect, but did not do so since, he maintained, he was mistaken as to the conditions of eligibility. The applicant maintained that he was never informed by the respondents that he did not have to include the amount of his pension in his income for purposes of eligibility for the Supplement.

[12]      The applicant argued that the respondents should have used the information available from the CCRA to identify him as a potential claimant for the Supplement, and their failure to act caused discriminatory prejudicial consequences prohibited by section 15 of the Charter.

[13]      Accordingly, the applicant did not challenge the constitutional validity of the Act: rather he maintained there had been a systemic fault, that of doing nothing to inform the group by the procedure set out in paragraph 33.11(a) of the Act and subparagraph 241(4)(e)(viii) of the I.T.A.

[14]      The applicant argued that this duty to act resulted not from any legislation but rather from the rights entrenched in the Constitution. Relying essentially on Eldridge v. British Columbia, [2001] 3 S.C.R. 184, a judgment of the Supreme Court of Canada, the applicant argued that the Department had a duty to inform members of the group of their potential eligibility for the Supplement because it had the necessary tools to determine their financial situation, and that this failure was a breach of the equality right of its members protected by section 15 of the Charter.

[15]      The applicant wished to represent all persons eligible to receive the Supplement. In order to illustrate the alleged discrimination sustained by his group, he proposed as a comparison group the group of elderly persons not entitled to the Supplement. Accordingly, the applicant argued that his group suffered differential treatment compared to persons not eligible for the Supplement.

[16]      The applicant further alleged that in the case at bar the proper compensation under section 24 of the Charter was reimbursement of the Supplement not claimed, with interest, and an additional amount as well for exemplary damages.

[17]      Since December 4, 2002, the Federal Court Rules, 1998 have set out the procedure for a class action in detail. They are also generally similar to the procedure set out in the Ontario Class Proceedings Act 1992, S.O. 1992, c. 6. Although there are some differences from the rules contained in the Quebec Code of Civil Procedure, there are overlaps between the two legal systems in some respects. Consequently, the existing precedents in all provinces can serve, mutatis mutandis, as a helpful guide to interpreting the new Federal Court Rules, 1998.

[18]      In the first paragraph of Rule 299.18, Parliament has stated:

[19]      This first paragraph accordingly sets out the five cumulative conditions to be met if leave to bring a class action is to be obtained. In the case at bar, therefore, the Court must determine whether the applicant's motion meets these five conditions.

[20]      Accordingly, it should first be determined whether the pleadings disclosed a reasonable cause of action.

[21]      At this stage, the applicant does not have to prove on the merits that his cause of action is reasonable: the threshold he must meet is much lower. As Winkler J. said in Edwards v. Law Society of Upper Canada (1995), 40 C.P.C. (3d) 316 (Ontario Court of Justice - General Division):

3. . . .There is a very low threshold to prove the existence of a cause of action . . . the court should err on the side of protecting people who have a right of access to the courts.

[22]      That being said, the courts refuse such a remedy when it is "plain and obvious" that the applicant has no reasonable cause of action and that his action is doomed to failure. In Kimpton v. Canada, [2002] B.C. J. No. 2691 (British Columbia Supreme Court), Macaulay J. said:

6. The threshold is low. Ms. Kimpton is not required to pass a preliminary merits test. While some cases have suggested that the plaintiff bears a burden to show a cause of action, that is potentially misleading, as burdens are generally evidentiary in nature. I prefer to say that the plaintiff must demonstrate on the pleadings, or the pleadings as they might reasonably be amended, that there is a cause of action. I should only refuse to certify where Ms. Kimpton plainly and obviously cannot succeed.

[23]      The test to be met at this stage is the same as that applied to the striking out of pleadings. As the British Columbia Court of Appeal indicated in Elms v. Laurentian Bank of Canada, [2001] B.C. J. No. 1284:

20. It is common ground that the Chambers judge correctly stated that a court will only refuse to certify on the basis that the pleadings do not disclose a cause of action if it is plain and obvious that the plaintiff cannot succeed. The test under s. 4(1)(a) of the Act to determine whether a cause of action exists is similar to the test applied in application to dismiss a claim on the grounds that it fails to disclose a cause of action. The only difference between the two tests is that the onus to show a cause of action falls upon the party bringing the class action, rather than on the party challenging the proceeding.

[24]      In the case at bar the applicant's action is based entirely on the argument that the respondents' omission was a breach of the equality right protected by section 15 of the Charter. Unlike what he had indicated in the motion record for leave to bring a class action, the applicant dealt in his memorandum neither with an alleged general duty imposed on the respondents to inform potential claimants to the Supplement nor with a duty originating elsewhere than in paragraph 33.11(a) of the Act and subparagraph 241(4)(e)(viii) of the I.T.A.

[25]      It is thus crucial to look closely at the judicial interpretation of the concept of discrimination in a constitutional context, so as to determine whether a reasonable cause of action exists in the case at bar. Although in their written argument the respondents dealt with all the conditions to be met for obtaining leave to bring a class action, in their submissions to the Court they dealt almost entirely with the question of the absence of a reasonable cause of action, arguing that the obviously groundless nature of the applicant's contentions regarding discrimination was sufficient in itself to justify dismissal of the motion at bar.

[26]      Following the approach taken by the Supreme Court of Canada in Law v. Canada, [1999] 1 S.C.R. 497, the respondents noted that a three-stage analysis must be undertaken to determine whether the conditions necessary to support an argument of discrimination have been met, and then argued that none of those three conditions had been met.

[27]      In that case the Supreme Court, per Iacobucci J., developed three stages for analyzing the conditions necessary to support an allegation of discrimination:

In my view . . . a court that is called upon to determine a discrimination claim under s. 15(1) should make the following three broad inquiries. First, does the impugned law (a) draw a formal distinction between the claimant and others on the basis of one or more personal characteristics, or (b) fail to take into account the claimant's already disadvantaged position within Canadian society resulting in substantively differential treatment between the claimant and others on the basis of one or more personal characteristics? If so, there is differential treatment for the purpose of s. 15(1). Second, was the claimant subject to differential treatment on the basis of one or more of the enumerated and analogous grounds? And third, does the differential treatment discriminate in a substantive sense, bringing into play the purpose of s. 15(1) of the Charter in remedying such ills as prejudice, stereotyping, and historical disadvantage? The second and third inquiries are concerned with whether the differential treatment constitutes discrimination in the substantive sense intended by s. 15(1). (pp. 523-524)

[28]      Just recently, in 2003 SCC 54">Nova Scotia (Workers' Compensation Board) v. Martin, 2003 SCC 54, the Supreme Court repeated that the Law three-stage test remains the proper approach in matters of discrimination. Accordingly, the Court must determine whether in the case at bar:

(1)        there was differential treatment;

(2)        the differential treatment was based on an enumerated or analogous ground in section 15;

(3)        the differential treatment is discriminatory, that is, it infringes human dignity.

[29]      The first stage necessarily requires reference to the comparison group in order to assess the existence of differential treatment. There must be an adequate connection between the comparison group chosen and the benefit which is the subject of the complaint. As the Supreme Court noted in Granovsky v. Canada, [2000] 1 S.C.R. 703, at 729:

The identification of the group in relation to which the appellant can properly claim "unequal treatment" is crucial. The Court established at the outset of its equality jurisprudence in Andrews, supra, that claims of distinction and discrimination could only be evaluated "by comparison with the conditions of others in the solution and political setting in which the question arises" (p. 164). See also Law, supra, at para. 24:

This comparison determines whether the s. 15(1) claimant may be said to experience differential treatment, which is the first step in determining whether there is discriminatory inequality for the purpose of s. 15(1).

[30]      The comparison group in the case at bar is that of elderly persons not receiving the Supplement. Before examining the choice of the comparison group, it should be recalled that the group represented by the applicant is that of persons entitled to the Supplement. It differs from, and includes, the group discriminated against, composed of persons eligible to receive the Supplement but who have not received it. The applicant did not appear to understand this distinction as he maintained that the group represented is the discriminated group, although there are several members of that group who have in fact received the Supplement and have not actually been discriminated against. The applicant justified his reasoning by saying that it is not necessary for the disadvantage to affect all members of a group for there to be discrimination.

[31]      Apart from this nebulous reasoning, which illustrates a general rhetorical confusion on the part of the applicant, I feel that the choice of the comparison group is to say the least debatable. Elderly persons who are not eligible for the Supplement (the comparison group) receive fewer benefits than the group represented by the applicant under the Act. For the applicant to succeed in proving there was discrimination he should show that he was treated differently compared to other persons who received greater benefits under the Act. Further, since claimants for the Supplement necessarily receive the pension, they cannot be the subject of discrimination compared to those receiving the same pension.

[32]      The Robert dictionary defines discrimination as [translation] "separating one social group from others by treating it more badly" (my emphasis). In the case at bar, it is actually the comparison group which is the less well treated of the two, as its members are entitled to fewer benefits than the group represented by the applicant.

[33]      Accordingly, to answer the first question set out in Law: if there is differential treatment between the two groups, it is in favour of the group represented by the applicant, not to its detriment.

[34]      As this three-stage test is cumulative, the analysis of this first stage would suffice to conclude that there was no discrimination. Nevertheless, I feel it is worth examining the second stage, namely whether the differential treatment was based on a ground enumerated, or analogous to those listed, in section 15 of the Charter.

[35]      This is another case where the applicant's vague and cloudy approach is not at all helpful to this Court. The applicant did not take the trouble to specify on what personal characteristic the alleged discrimination was based. As age was not one, we may assume that income was really the ground relied on by the applicant.

[36]      Our courts have consistently held that financial situation is not a ground protected by the Constitution. [translation] "Income-related discrimination" has long been one of the cornerstones of our tax and social legislation. Adverse effect discrimination therefore cannot result from a characteristic based on income.

[37]      In the case at bar, income clearly cannot be used as a ground of distinction since wealthier individuals are not entitled to the Supplement. Even where the pension is concerned, the tax system provides that a pension claimant must reimburse the pension as his or her income increases.

[38]      Although I do not exclude the possibility that the disadvantaged and systemic socio-economic situation of a group may be regarded as a personal characteristic on which discriminatory treatment might be based, there is nothing the case at bar to support such a conclusion.

[39]      As regards Eldridge, on which all the applicant's constitutional arguments are based, I adopt the respondents' arguments in saying that it has no effect here since, in that case, the adverse effect suffered by deaf persons resulted from the fact that actions were not taken so they would benefit equally from a service available to everyone.

[40]      Accordingly, Eldridge must clearly be distinguished from the facts in the case at bar, since the public health care system under challenge there (as it did not provide sign language interpreter services for deaf persons) was a universal public health care system, unlike the benefits under the Supplement, which is paid on application to persons meeting the requirements of the Act, including that of income, which must not exceed the eligibility threshold.

[41]      Accordingly, there is not even the slightest shadow of an indication that there is a constitutional breach here. The misunderstanding of fundamental legal principles demonstrated by counsel for the applicant is staggering. Accordingly, there could hardly be a more complete lack of any reasonable cause of action.

[42]      Quite aside from the constitutional arguments, which were dismissed above, the applicant's action has no legal basis. In particular, there is no legal obligation on the respondents to inform potential claimants of the Supplement. The applicant relied excessively on the Committee's December 2001 report to argue that the respondents had a legal duty to use the information in the possession of the CCRA to identify all potential claimants of the Supplement. That report is a purely political document, not a legal (or even juridical) one.

[43]      The applicant submitted it was shameful to see the efficiency and strictness manifested by the respondents when this available information was to be used to deprive people of benefits compared to when it would be used to grant them. With respect, and without wishing to be guilty of misplaced cynicism, I have to say that human nature being what it is, one is more inclined to adopt a proactive attitude when claiming rights than when possibly being deprived of them. Accordingly, it is quite natural for the government to take this fact into account and for the result to be that its coercive efforts are inversely proportional to those of the individuals covered by the Act.

[44]      Despite this, the evidence in the record shows that since the Supplement was introduced in 1967, the Department has informed recipients and potential recipients of the Supplement in various ways. Ironically, it was the sending out of simplified Supplement applications, a measure initiated by the Department in 2001 for the praiseworthy purpose of encouraging access to the Supplement and increasing the participation rate of potential recipients, which served to occasion these proceedings. To use the words of Albert Camus: [translation] "Not long ago it was wrongly actions that had to be justified: now it is the good ones".

[45]      Additionally, to emphasize the absence of any reasonable cause of action, the respondents noted that eligibility for the Supplement is determined in accordance with the Act and the procedure set out therein: the applicant has applied for and received Supplement benefits and maximum arrears of 11 months. Accordingly, the respondents suggested that the applicant was trying to obtain more than he was entitled to by claiming more advantageous compensation based on section 24 of the Charter than pursuant to the clear provisions of the Act. The respondents submitted that the applicant could not argue that paragraph 11(7)(a) of the Act could not be relied on against him since he had not claimed that it was invalid.

[46]      For his part, the applicant submitted that this Court has extensive room for manoeuvre in exercising the discretion conferred by subsection 24(1) of the Charter and so can award any compensation it thinks fit and proper in the circumstances.

[47]      In view of the foregoing, this question does not have to be answered. However, it should be noted that if the failure of the application depended only on this last argument there would ultimately be nothing to prevent this Court authorizing the applicant to amend his pleadings so as to include a conclusion that paragraph 11(7)(a) of the Act is unconstitutional.

[48]      As the conditions mentioned in the first paragraph of Rule 299.18 are cumulative, it is not necessary to examine the other conditions mentioned in that paragraph in order to conclude that the applicant's motion should be dismissed. Indeed, this is the approach preferred by the Supreme Court, which with reference to authorization of a class action has no hesitation in dismissing the application once it has concluded that the threshold of eligibility for the existence of a reasonable cause of action has not been met. See in particular Guimond v. Quebec (Attorney General), [1996] 3 S.C.R. 347.

ORDER

For the foregoing reasons, the motion for leave is dismissed.

In accordance with Rule 299.41(1) of the Federal Court Rules, 1998, no order is made as to costs.

Ottawa, Ontario

February 4, 2004

Certified true translation

Suzanne M. Gauthier, C Tr, LLL

                                                             FEDERAL COURT

                                                      SOLICITORS OF RECORD

DOCKET:                                                                            T-317-03

STYLE OF CAUSE:                                                            ANDRÉ LE CORRE v. THE ATTORNEY GENERAL OF CANADA ET AL.

PLACE OF HEARING:                                                      Montréal, Quebec

DATE OF HEARING:                                                        December 11, 2003

REASONS FOR ORDER AND ORDER:                        THE HONOURABLE MR. JUSTICE HUGESSEN

DATE OF REASONS FOR ORDER AND ORDER:      February 4, 2004

APPEARANCES:

Fredy Adams                                                                         FOR THE APPLICANT

Gilles Gareau

Rosemarie Millar                                                                    FOR THE RESPONDENTS

Frédéric Paquin

SOLICITORS OF RECORD:

Adams, Costa, Attorneys                                                        FOR THE APPLICANT

Montréal, Quebec

Lauzon, Bélanger

Montréal, Quebec

Morris Rosenberg                                                                   FOR THE RESPONDENTS

Deputy Attorney General of Canada

Ottawa, Ontario