Docket: T-1505-15
Citation:
2017 FC 270
[ENGLISH
TRANSLATION]
Ottawa, Ontario, March 10,
2017
PRESENT: The Honourable Mr. Justice LeBlanc
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BETWEEN:
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MAURICE ARIAL
(VETERAN –
DECEASED)
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MADELEINE ARIAL
(ESTATE)
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MADELEINE ARIAL
(PERSONALLY)
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SONIA ARIAL
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Plaintiffs
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and
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HER MAJESTY THE
QUEEN IN RIGHT OF CANADA ON BEHALF OF THE DEPARTMENT OF VETERANS AFFAIRS AND
THE VETERANS REVIEW AND APPEAL BOARD
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Defendants
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ORDER AND REASONS
I.
Introduction
[1]
This is a motion by which the defendant, Her
Majesty the Queen in Right of Canada, on behalf of the Department of Veterans
Affairs (the Defendant), is seeking to strike the entire action for damages
brought against it by the plaintiffs, without leave to amend. The defendant
feels that said action must be struck on the grounds that it reveals no
reasonable cause of action and constitutes an abuse of process as defined in Rules
221(1)(a) and 221(1)(f) of the Federal Court Rules, SOR/98-106 (the
Rules).
[2]
This motion, which was first brought before
Prothonotary Mireille Tabib under Rule 369 at the same time as a similar request
by the other defendant in the action by the plaintiffs, the Veterans Review and
Appeal Board (the Board), is the most recent episode in a long saga that
opposes the plaintiffs and Canadian authorities responsible for applying the Pension
Act, RSC (1985), c. P-6 (the Act), a saga that has already resulted in five
judgments or orders by this Court and a judgment by the Federal Court of
Appeal, the most recent before the action was brought by the plaintiffs. The
list is as follows:
- Arial v
Canada (Attorney General), 2010 FC 184
(Tremblay-Lamer J.), application for judicial review allowed;
- Order by
Tremblay-Lamer J., docket T-1739-10, December 16, 2010, application for
judicial review allowed on consent;
- Arial v
Canada (Attorney General), 2011 FC 848 (Shore
J.) [Arial 2011], application for judicial review allowed;
- Arial v
Canada (Attorney General), 2012 FC 353 (Shore
J.), motion for directions dismissed;
- Arial v
Canada (Attorney General), 2013 FC 602 (Roy
J.) [Arial 2013], application for judicial review dismissed; and
- Arial v
Canada (Attorney General) 2014 FCA 215 [Arial
FCA], appeal of the judgment by Roy J. dismissed.
[3]
In the simplest terms, the plaintiffs, the late
Maurice Arial (Mr. Arial), a veteran who served in the Second World War,
Madeleine Arial, his spouse, and their daughter, Sonia Arial (Sonia), who has
been defending the interests of her parents almost since the beginning of this
saga, are seeking in their action a total of $802,217.72 in compensation for
faults allegedly committed against them by officials from the Department of
Veterans Affairs (the Department) and the Board, in processing applications for
pensions and other benefits filed under the Act by Mr. Arial and by his spouse
following his death. They also believe that they are entitled to non‑pecuniary
and punitive damages, the amount of which they leave to the discretion of the
Court.
[4]
The source of the plaintiff’s recriminations is
the treatment of the initial pension application filed by Mr. Arial, in March
1996, for a stomach problem related to his military service, in which officials
at the Department allegedly failed in their duty to provide Mr. Arial aid and
assistance, as required by the Act, particularly given his age and precarious
health when the application was filed and his low level of education.
[5]
It is well-established that, to strike an action
on the grounds that it reveals no reasonable cause of action within the meaning
of Rule 221(1)(a), the Court, assuming the alleged facts are true, must be
satisfied that it is plain and obvious that the action commenced, even if
interpreted generously, has no reasonable chance of success (R. v Imperial
Tobacco Canada Ltd., 2011 SCC 42, at para 17, [2011] 3 S.C.R. 45; Odhavji Estate v
Woodhouse, 2003 SCC 69, at para 15, [2003] 3 S.C.R. 263; Hunt v Carey
Canada Inc., [1990] 2 S.C.R. 959, at p. 980).
[6]
Moreover, when invited to find that a statement
of claim must be struck on the grounds that it constitutes an abuse of process
within the meaning of Rule 221(1)(f), the Court must be satisfied that allowing
the litigation to proceed would “violate principles
such as ‘judicial economy, consistency, finality and the integrity of the
administration of justice’ [...]” (British Columbia (Workers’
Compensation Board) v Figliola, 2011 SCC 52,
[2011] 3 S.C.R. 422, at para 33 [Figliola]).
The underlying principles in the approach to be followed to detect the “abuse of the decision-making process” were summarized
as follows in Figliola, at para 34:
• It
is in the interests of the public and the parties that the finality of a
decision can be relied on (References omitted).
• Respect
for the finality of a judicial or administrative decision increases fairness
and the integrity of the courts, administrative tribunals and the
administration of justice; on the other hand, relitigation of issues that have
been previously decided in an appropriate forum may undermine confidence in
this fairness and integrity by creating inconsistent results and unnecessarily
duplicative proceedings (Reference omitted).
• The
method of challenging the validity or correctness of a judicial or
administrative decision should be through the appeal or judicial review
mechanisms that are intended by the legislature (References omitted).
• Parties
should not circumvent the appropriate review mechanism by using other forums to
challenge a judicial or administrative decision (References omitted).
• Avoiding
unnecessary relitigation avoids an unnecessary expenditure of resources
(Reference omitted).
[7]
Before determining whether the Defendant’s
motion meets these requirements, background is needed given the singular nature
of this case and what led to the hearing for that motion.
II.
Background
A.
The order and directive by Prothonotary Tabib
[8]
As she was the first to hear the motions to
strike filed by the Defendant and the Board, it is important, as initial
background, to first examine the manner in which Prothonotary Tabib disposed of
these two motions on April 25, 2016.
[9]
First, in an order, Prothonotary Tabib allowed
the Board’s motion, thus striking the plaintiffs’ action against it, without leave
to amend. Prothonotary Tabib found that the plaintiffs’ action constituted an
abuse of process and was contrary to the immunity afforded the Board and its members.
[10]
Regarding the first basis for her decision,
Prothonotary Tabib stated that she was of the view that, in that the plaintiffs
were seeking to recover the amounts that should have been paid to them if Mr.
Arial had been granted the right to the full pension and attendance allowance,
retroactive to March 1996, there was an abuse of process, as that claim
ultimately aims to recover amounts for which payment was refused to the plaintiffs
after they had exhausted all recourse under the Act. In this regard,
Prothonotary Tabib stated the following:
[translation]
Regarding the claim for amounts that Maurice
Arial, his spouse or his estate could have received as a pension or allowance
if the right to those amounts had been granted retroactively to March 7, 1996,
instead of the years from 2000 to 2002, it is clear that the action seeks to
recover the same amounts as the plaintiffs unsuccessfully tried to recover
through the administrative process provided for in the Act. The breaches and
faults that the action alleges were committed by the Board or its agents and
that apparently unfairly “deprived” the plaintiffs of their right to full
retroactivity have already been or should have been raised as grounds that
taint the merits, the appropriateness or the fairness of the Board’s decisions
at all stages of the administrative process and the judicial reviews
undertaken. Moreover, the decision by the Federal Court of Appeal in the
judicial review of the Board’s last decision is absolutely clear: the Board’s
decision to cite section 85 was reasonable (Arial v Canada (Attorney
General), 2014 FCA 215, at para 30), and therefore cannot be wrongful. The
Court of Appeal also stated at paragraph 33 of its reasons:
[…] the maximum award paid under the
Act cannot, in any event, ever exceed the three-year retroactivity period
(subsections 39(1) and 56(1)) and the additional award equivalent to two years’
pension (subsections 39(2) and 56(2)). The appellants were indeed granted the
maximum amounts under both these headings.
The plaintiffs’ action clearly constitutes
an attempt to circumvent the decisions that were rendered and that found the
final result of the administrative process to be legal and reasonable. It is an
obvious abuse of process that merits being struck. (Toronto (City) v
C.U.P.E., Local 79, [2003] 3 S.C.R. 77, and British Columbia (Workers’
Compensation Board) v Figliola, [2011] 3 S.C.R. 422, 2011 SCC 52).
[11]
Regarding the second ground for striking the plaintiffs’
action against the Board, Prothonotary Tabib found that, when considered from
the perspective of a civil liability action, the plaintiffs’ action is contrary
to the immunity of the Board, which limits its civil liability and that of its
members to acts resembling bad faith:
[translation]
The Crown’s liability for damages or
extra-contractual fault must necessarily be based on the failure of one of its
employees or agents, for which the employee or agent could be held liable if he
or she were pursued personally.
All wrongdoings that the statement alleges
by the Board or its members were solely related to how the Board and its
members acted in carrying out their duties. However, it is a well-established
rule of law that members of administrative tribunals have immunity from any
civil liability action for what they do in carrying out their duties, unless
there is evidence of bad faith. (See: Henri Brun, Guy Tremblay, Droit
Constitutionnel, 4th Ed., Cowansville, Édition Yvon Blais Inc., 2002, at pp.
814–815).
The Federal Court Rules require that
allegations of deliberate wrongdoings, or regarding the state of mind of a
person, such as malice or fraudulent intention, similar to bad faith, must be
specified (Rule 181). However, the statement does not allege any fats that, if
assumed to be true, would make it possible to conclude that the actions of any
member or agent of the Board were tainted by bad faith. That gap, by itself, is
also fatal and justifies striking the action.
[12]
The plaintiffs did not appeal that decision.
[13]
Second, in a directive, Prothonotary Tabib ruled
that, unlike the Board’s motion, in which the issues seemed clear and simple,
despite the complex background of the case, and therefore conducive to a
decision without an oral hearing, the Defendant’s motion could not be
adequately dealt with in writing. She felt that that was the case because the
Court would benefit from hearing submissions by the parties in light of
paragraph 36 of the decision by Roy J. in Arial 2013, which, as we read
in the directive, [translation] “seems to open the door to a civil liability action under the
circumstances of this case […]”.
[14]
Pursuant to the directive from Prothonotary
Tabib, additional written submissions were prepared by the Defendant and its
motion was debated orally, in a general motions session at Québec City on
November 17, 2016.
B.
Outline of the plaintiffs’ statement of claim
[15]
As noted by Prothonotary Tabib, the plaintiffs’
statement of claim is prolific and the history of the relationship between Mr.
Arial, his spouse and the authorities responsible for applying the Act, which spans
over 20 years when we consider the various actions taken by the plaintiffs to
claim their rights under the Act, is complex and the supporting documentation
is lengthy.
[16]
However, as also noted by Prothonotary Tabib,
this background, set out in paragraphs 10 to 78 of the statement of claim and
includes a total of 95, is not only assumed to be true for the purposes of this
motion, but is also not disputed.
[17]
In their written submissions to the Defendant’s
and Board’s motions, the plaintiffs indicated that their statement of claim “was in fact a copy/paste of the memorandum of facts and law
in docket T-250-11 […]”, which led to the judgment by Shore J. in Arial
2011. Under the circumstances, it is enough for me to reproduce the
following passages from the judgment by Roy J. in Arial 2013, which was
issued in the wake of the judgment by Short J., to provide the main
elements of that background:
[4] The factual background in this
case is complex because of the multiplicity of proceedings. I believe that the
following summary will suffice for the purposes of this judicial review.
[5] It should be noted that, parallel
to the proceedings that are before this Court regarding a disability pension
for stomach problems, the plaintiffs brought a series of proceedings with
respect to an application for an attendance allowance and an application for a
disability pension for hearing loss. The application for an attendance
allowance was the subject of an application for judicial review; Madam Justice
Danièle Tremblay‑Lamer’s decision is found at Arial v Attorney General
of Canada, 2010 FC 184. We are concerned here only with the saga of the
disability pension for stomach problems.
[6] The veteran, Maurice Arial, was
born on January 8, 1916. He enrolled in the Royal Canadian Navy in June 1940. From
July 1940 to July 1945, on different ships, he was responsible for both
machinery maintenance and the supply of ammunition located in the holds of the
ships. He was demobilized at the end of the war. In his service records, there
are two medical reports dated May 7, 1944, and February 19, 1945. Apart from
being rather general, they deal with weight loss, nervousness, fatigue and
seasickness.
[…]
[8] On March 7, 1996, Mr. Arial filed
an application for a disability pension for stomach ulcers. A number of
incidents ensued concerning the filing of a medical report required by the
authorities at the time and necessary for considering whether to grant such a
pension. In the absence of a medical report, Mr. Arial’s file was closed on
September 27, 1996. The service documents did not reveal any specific problem
other than the seasickness Mr. Arial suffered.
[9] On October 13, 1999, Mr. Arial
appointed his daughter as his designated representative. That day, she
contacted [Veterans Affairs Canada (VAC)] and filed a new application on her
father’s behalf for a disability pension based on stomach problems. A few days
later, a pension officer sent a form to Mr. Arial asking him to submit a recent
medical report. On November 18, 1999, Sonia Arial sent the pension officer a
cover letter, the pension application form and a statement from one Dr. Lepage
indicating the diagnosis of gastroesophageal reflux [GER]. These documents
indicate, inter alia, that Mr. Arial had been under doctor’s care for stomach
problems since returning from the war.
[10] On December 29,
1999, the pension application was denied. An analysis of Mr. Arial’s service
documents led to the conclusion that they did not reveal [translation] “any
impairment or condition arising from military service or any injury resulting
from a service‑related accident.”
[11] Mr. Arial passed
away on September 25, 2005.
[12] On December 19,
2005, Sonia Arial contacted VAC and asked that an official decision be made
concerning the disability pension application for various stomach problems that
had been submitted in 1999. Additional information was provided at that time.
[13] On August 8, 2006,
VAC, by ministerial decision, denied this application on the ground that the
medical service documents did not reveal any impairment and that no relevant
dispute had been submitted in Mr. Arial’s file for many years following his
demobilization. Sonia Arial disputed this decision.
[14] On January 24, 2007,
a review panel of the Veterans Review and Appeal Board confirmed the ministerial
decision of August 8, 2006. The review panel found that there was no causal
connection between Mr. Arial’s stomach problems and his military service. Sonia
Arial also disputed that decision.
[15] On October 30, 2007,
an appeal panel of the Veterans Review and Appeal Board granted the plaintiffs
a pension entitlement for the Second World War service. The appeal panel
recognized that Mr. Arial had suffered from a recurring duodenal ulcer since
1940 and that the GER diagnosis was the manifestation of the ulcer. The appeal
panel established the effective date of the pension retroactively to November
9, 2005, the date the application was considered to be complete. No additional
award was granted.
[16] The issue that gave
rise to this application for judicial review concerns the commencement date of
the pension that the plaintiffs say they are entitled to. They disputed the
date of November 9, 2005.
[17] On June 24, 2008, a
reconsideration panel of the Veterans Review and Appeal Board refused to change
the effective date of the pension on the ground that the application was not
completed until that date under the Award Regulations.
[18] This issue was heard
again before a second reconsideration panel. On May 14, 2009, this second
reconsideration panel agreed that a pension application was made in 1996. It
established the effective date as October 30, 2004, the day three years prior
to the day on which the pension was awarded, invoking paragraph 56(1)(a.1)
of the Pension Act, RSC 1985, c P-6 (the Act), and granted an additional
award of 24 months under subsection 56(2) of the Act because of delays beyond
the plaintiffs’ control. [Quote from subsections 56(1) and 56(2) of the Act
omitted]
That decision was, in turn, disputed by
Sonia Arial.
[19] On December 2, 2010,
a third reconsideration panel denied Sonia Arial’s application for
reconsideration because there were no grounds warranting a new examination
under section 32 of the Veterans Review and Appeal Board Act, SC 1995, c
18.
[20] That decision was
subsequently the subject of an application for judicial review (Arial Estate,
supra). Justice Shore set aside the decision of December 2, 2010, and
referred the case back to a differently constituted panel.
[21] As a result of
Justice Shore’s decision, a new hearing was held before the Board on November
1, 2011. A decision was finally issued on January 4, 2012, the decision that is
the subject of this judicial review.
[Heading omitted]
[22] To understand the
decision for which judicial review is sought, it is important to first identify
the ratio decidendi of the Court’s judgment by Mr. Justice Shore because
that decision for which review is sought was intended to be the follow‑up
ordered by the Court.
[23] On the basis of the
minister’s duty under subsection 81(3) of the Act to “on request, provide a
counselling service to plaintiffs and pensioners with respect to the
application of the Act to them; and assist plaintiffs and pensions in the
preparation of applications”, Justice Shore ordered that the issue of the retroactivity
of the pension be examined again. Paragraph 65 of the decision is instructive:
[65] Moreover, it is not this
Court’s role to determine if the pension should be retroactive to May 7, 1996,
or not; rather, the Court must determine whether the case should be referred
back to a new panel so that the facts and law can be reconsidered should an
error in fact or in law have been committed. It will be up to this new panel to
determine whether the retroactive effect of the award should be extended back to
March 7, 1996. Clearly, Parliament does not speak
in vain. Since Parliament has provided that VAC pension officers owe veterans
certain obligations to provide them with the information they seek about
pension applications, a breach of these obligations must carry consequences.
[Emphasis in
original]
[24] Thus, the Court did
not pre-order a conclusion by the reconsideration panel. Pointing to the spirit
of the Act , which is intended to be generous and which should be interpreted
that way, the Court referred the case back so that the facts and law could be
re‑examined. Paragraph 76 appears to me to capture the essence of the
Court’s decision:
[76] VAC’s breach of the duty
owed to Mr. Arial degraded the quality of life of this veteran. The Court
refers the case back to the Veterans Review and Appeal Board so that the Board
can review its responsibilities toward the Arial family. It will be up to the
Board to determine what a major breach of its duty to inform is worth, in
accordance with the legislation and the case law and bearing in mind that fact
that it is not merely suggested but is explicitly stated in the PA itself that
VAC must provide a counselling service to plaintiffs and pensioners “with
respect to the application of this Act to them . . . and . . . assist plaintiffs
and pensioners in the preparation of applications” (subsection 81(3) of the
PA). The Board has an obligation to stay true to its mandate to respect this
statement and not treat it like a superficial public relations ploy.
[25] Faced with this
order, the Board reviewed the issue of the date on which the pension should be
paid in light of the law and the facts. In its decision, the Board stated that
it was unable to do better than the final decision already made. The pension
could be paid effective October 30, 2004, three years prior to the date of the
decision to award a pension. An additional award of 24 months was granted under
subsection 56(2) of the Act.
[26] Essentially, the
Board submitted to this Court’s decision and concluded that, in accordance with
the clear wording of the Act, it confirmed the previous decision.
[18]
The statement of claim refers to the judgment by
Roy J., but it must be noted, which it does not clearly do, that Roy J.
dismissed the plaintiffs’ application for judicial review of the Board’s
decision, which was pursuant to the judgment by Shore J. in Arial 2011.
In his judgment, Roy J. first noted the concession by the plaintiffs, correctly
in his view, that the Board had awarded them the maximum under the Act for failures
by the Department in their regard (Arial 2013, at paras 27–28). He then
dismissed the plaintiffs’ alternate grounds that the Board should have awarded
more for the Department’s failure to provide them with assistance by referring
them to the Minister of Veterans Affairs (the Minister) to exercise its
discretion under section 85 of the Act. In this regard, Roy J. found that
referring the case to the Minister would not have helped them in any way, as
the Minister could not have awarded them damages in addition to what they had
already received without contravening the Act. As such, he found, the Board’s
decision to not refer the case to the Minister was reasonable (Arial 2013,
at paras 33–36).
[19]
For the same reasons, it must also be noted
that, in Arial FCA, the Federal Court of Appeal dismissed the applicants’
appeal of the judgment by Roy J., finding that the latter’s refusal “to order that the matter be referred to the Minister is necessarily
reasonable because even if he had done so, the appellants could not have been
awarded any additional amount” (Arial FCA,
at para 34).
[20]
Once this background is understood, I find that
the essence of the action taken by the plaintiffs in this case, which according
to paragraph 95 of the statement of claim is based on the extra-contractual
liability of the Crown and, at the same time, subsection 24(2) of the Canadian
Charter of Rights and Freedoms (the Charter), can be summarized as
Prothonotary Tabib did in her order on April 25, 2016:
[translation]
[…] Mr. Arial first filed a pension
application under the [Act] in March 1996. Eventually, following numerous
applications for review, appeals and judicial reviews, Mr. Arial’s right
to his full pension and an attendance allowance for various conditions was
recognized, but only retroactive to the period from June 2000 to October 2002.
According to the plaintiffs, were it not for the wrongful and illegal actions
of the defendants, Mr. Arial’s right to the full pension and allowance would
have been recognized retroactive to 1996, and Sonia Arial would not have had to
spend more than 6,000 hours and incur costs, including medical costs, to help
her father in his efforts.
The action therefore seeks “losses” due to
the lack of full retroactivity for Mr. Arial and his spouse, lost wages and
medical costs incurred by Sonia Arial as pecuniary damages, and non-pecuniary
damages not quantified by the three plaintiffs.
[21]
In that regard, it seems important to cite
paragraph 94 of the statement of claim, which sets out what the plaintiffs claim
they want to show, if there are proceedings, to convince the Court of the
merits of their claims:
[translation]
94. Under Rule 181(1) of the Federal
Court Procedures [sic], the plaintiffs seek to show the Federal Court that:
(a) The [Veterans Review and Appeal
Board (VRAB)] changed my testimony on two occasions: May 2006 and January 2007;
(b) The [Department of Veterans
Affairs (DVA)] has been advised of the unfair situation, in a 1st
letter was sent to the Minister in July 2007, a 2nd letter in April
2008 and, finally, a 3rd in July 2010, without any action on their
part, total denial.
(c) the DVA and VRAB changed the
wording of the claim in a decision regarding the [gastroesophageal reflux
(GER)], when it should have decided regarding the duodenal ulcer including the
RGO.
(d) The VRAB put words in the mouth
of my counsel, something that he never said or that we had discussed
together: “the pension officer must obtain/find the diagnosis”.
(e) Through its lack of actions,
during the proceedings, the VRAB compelled my counsel, who had taken the case
PRO BONO, to send them a formal notice for Contempt of Court to get them to
react. However, there was an order on consent from the Federal Court by
Tremblay-Lamer J. between counsel for the family and counsel for the Department
of Justice. That took five months to resolve.
(f) The DVA or VRAB ignored the job
description for a pension officer, the pension officer manual, finally, they
did everything contrary to the Act.
(g) The VRAB ignored subsection
81(2), although in 1976, “The Board considered that an application was not
complete if there was no evidence of disability. The Board disagreed and found
that a decision was mandatory, whether or not there was a disability.” – All
applications = a decision.
(h) The VRAB ignored the letter from
Régis Gagnon in December 1999, overwhelming evidence mentioned by HQ at the 1st
hearing.
(i) At the hearing on May 14, 2009,
the VRAB considered this: “The Board considers that this application was judged
with the required expeditiousness, that there were no delays beyond the plaintiff’s
control and that the retroactivity for this condition was granted on the
application date”. In 2011, Shore J. of the Federal Court contradicted that
allegation.
(j) In its decision on June 24,
2008, the VRAB considered that there was “no error in factor in law”. The
decision was overturned.
(k) The VRAB prevented me from
speaking to them at the hearing on May 14, 2009, despite the decision by
Tremblay-Lamer J. in 2001 in Gagné.
(l) In doing so, the VRAB forced me
to take a series of steps over four months to obtain the reasons for decision.
(m) The members of the VRAB thus
abused their immunity, placing the burden of proof on the appellants.
(n) The VRAB refused to recognize
that the applications were split in 2004.
(o) The timelines were not respected,
despite numerous requests.
[22]
On reading that paragraph of the statement of
claim, it must be noted, and I will return to this, that the allegations that
make up the basis of the plaintiffs’ action are almost all addressed to the
Board.
[23]
I also feel that it is important here to cite
paragraph 2 of the statement of claim, which summarizes well, in my opinion,
what underlies this action by the plaintiffs and the importance for it of the
judgment by Short J. in Arial 2011:
[translation]
2. On November 1, 2011, after not
disputing or complying with the reasons for judgement and the judgment by the
Honourable Mr. Justice Michel Shore, docket T-250-11, the Veterans
Review and Appeal Board, in its role as an administrative tribunal, increased
the damages in a negative decision with different reasons with which the plaintiffs
disagree, as they are unfounded. The subsequent decisions by the Federal Courts
were negative, so the plaintiffs have no choice but to take the necessary
actions to obtain reimbursement for the harm caused by the infringement of
their rights.
[24]
Finally, it must be noted that Mr. Arial and his
spouse, who are the primary individuals concerned with the decisions by
authorities responsible for applying the Act in this case, are not the only one
seeking compensation. Their daughter, Sonia, is also seeking damages that,
incidentally, represent more than 50% ($410,084.33) of the total amount claimed
from the Defendant ($802,217.72). However, as we will see, her legal
relationship with the Defendant is not the same, as is therefore the resulting
legal analysis regarding the admissibility of her claim.
III.
Analysis
[25]
In my view, the plaintiffs’ action has no more
chance of success against the Defendant than it had against the Board and, in
its current wording, is just as much an abuse of process. In that regard,
paragraph 35 of the judgment by Roy J., which is the source of the hesitation
by Prothonotary Tabib in reserving the same outcome for the Defendant’s motion
as the Board’s motion, does not at all change this and is therefore of no use
to the plaintiffs.
[26]
I note that that paragraph of the judgment by
Roy J. is part of the reasons why she dismissed the plaintiffs’ argument that
the Board should have awarded more for the Department’s failure to assist them
by referring the matter to the Minister so that he could exercise his
discretion under section 85 of the Act in their favour. Roy J. found that that
argument was of no use to them, as the Minister could not award them more
damages than they had already received without contravening the Act. In other
words, Roy J. found, and the Federal Court of Appeal agreed in Arial FCA,
that the plaintiffs would not hope to receive more from the compensation plan
set out in the Act than what they had already been paid. That is what led the
Federal Court of Appeal to say that the judgment by Shore J., which led to the
Board’s decision before Roy J. for judicial review, unfortunately, “did create false hopes” (Arial FCA, at para
35).
[27]
It is also what led Roy J. to say at the very
end of paragraph 35 of his judgment, which clearly seems to have led
Prothonotary Tabib to set a hearing in the case, that the alleged wrong
committed by the authorities responsible for applying the Act was one of two
things: either “in the range of what is described in
subsection 56(2)”, in which case “the Act
establishes its own remedy”, or “of a different
kind”, in which case “we are then in the area of
civil liability where the Board has no jurisdiction.”
[28]
I interpret that passage from the judgment by
Roy J. as meaning that, if the plaintiffs want to obtain additional
compensation beyond what has already been recognized under the Act, including
for failure to provide assistance, the right to such compensation must be
rooted not in the Act, but in a different legal system, in this case the civil
liability of the Crown. However, Roy J. did not rule on the conditions for
admissibility of such an action, and much less on the admissibility of an
eventual claim by the plaintiffs under the Crown Liability and Proceedings
Act, RSC (1985), c. C-50 (CLPA), particularly regarding section 9 of that
Act, as he was not required to do so and, in any event, was not in a position
to do so. Indeed, that was not his role in the judicial review before him and
it was not up to him either, as such, to speculate on how an eventual claim of
that type by the plaintiffs would be worded.
[29]
Section 9 of the CLPA is, in my view, an
estoppel to the plaintiffs’ action, as they worded it. That provision reads as
follows:
|
No proceedings
lie where pension payable
|
Incompatibilité
entre recours et droit à une pension ou indemnité
|
|
9 No proceedings
lie against the Crown or a servant of the Crown in respect of a claim if a
pension or compensation has been paid or is payable out of the Consolidated
Revenue Fund or out of any funds administered by an agency of the Crown in
respect of the death, injury, damage or loss in respect of which the claim is
made.
|
9 Ni l’État ni
ses préposés ne sont susceptibles de poursuites pour toute perte — notamment
décès, blessure ou dommage — ouvrant droit au paiement d’une pension ou
indemnité sur le Trésor ou sur des fonds gérés par un organisme mandataire de
l’État
|
[30]
It is well-established that the purpose of that
provision is to prevent double recovery of damages for a single event providing
entitlement to a pension or allowance from the consolidated revenue fund and
that it applies to all damages arising from that event, even if the damages
claimed in the legal action “did not match the apparent
head of damages compensated for in that pension” (Sarvanis v Canada,
2002 SCC 28, at paras 28–29, [2002] 1 S.C.R. 921 [Sarvanis]). This is to “ensure that there is no Crown liability under ancillary
heads of damages for an event already compensated” (Sarvanis, at
para 29).
[31]
It is also well-established that section 9 of
the CLPA applies in a context such as when a pension or indemnity was paid — or
is payable — under the Act. In Dumont v Canada, 2003 FCA 475 [Dumont],
the Federal Court of Appeal, citing in particular section 9 of the CLPA, struck
the claims of two members of the Canadian Forces who claimed that the Forces
were liable for damages associated with post‑traumatic stress disorder
they said they suffered due to events arising from or related to their military
service.
[32]
In that case, the plaintiffs placed a great deal
of emphasis, in their respective statements of claim, on the incompetence that
the Canadian Forces’ employees, personnel and agents showed toward them, their
negligence in fulfilling their legal obligations, the abuse of authority that
they exhibited, the Canadian Forces’ failure to fulfill its fiduciary
obligation and its breach of section 7 of the Charter (Dumont, at para
39). Each claimed to suffer from major depression, internal stress, serious
disturbance of interpersonal relationships, significant feelings of aggression,
resulting in serious symptoms of irritability, post-traumatic stress, resulting
in major problems at the family level, great difficulty adapting socially and
living in an urban setting, intolerance to stress, symptoms of overstimulation,
increasing demoralization, and difficulty concentrating (Dumont, at paras
28–29). Both had been partially compensated under the Act, in one case for major
depression and, in the other, for post-traumatic stress disorder.
[33]
The Federal Court of Appeal found that the
claims were “prohibited under section 9 of the Act
because any loss or damage that is claimed gives entitlement to payment of a
pension” and that they should therefore be struck “because it is ‘plain and obvious beyond a reasonable doubt’
that they cannot succeed” (Dumont, at para 73).
[34]
In Sherbanowski v Canada, 2011 ONSC 177 [Sherbanowski],
the Ontario Superior Court reached the same conclusion in a case brought under
the CLPA by a former member of the Canadian Forces who was seeking to recover
losses and damages resulting from his military service. The plaintiff stated
that he suffered various forms of harassment during his military service, including
after he filed a compensation claim under the Canadian Forces Members and
Veterans Re-establishment and Compensation Act, SC 2005, c. 21 (Veterans
Compensation Act). He also alleged that the Canadian Forces refused his
initial pension application and did not implement adequate policies and
procedures regarding abuse and harassment. Finally, he sought not only general
damages, but also damages for the loss of past and future income that is not
compensated under the Veterans Compensation Act, and exemplary damages (Sherbanowski,
at paras 40, 41 and 46).
[35]
The Ontario Superior Court found that the plaintiff’s
action was inadmissible under section 9 of the CLPA because the action was
based around the same factual basis as the compensation applied for under the Veterans
Compensation Act. It added that the fact that the plaintiff was also
seeking damages for breach of contract, misrepresentation, breach of fiduciary
obligation and breach of Charter rights did not change anything. The Court
stated the following in this regard:
[43] A
complete identity exists between the losses asserted by Mr. Sherbanowski in
this action in respect of the Events Claims and the losses for which awards of
disability benefits have been granted to Mr. Sherbanowski and for which he has
received payment or which are payable to him. The factual basis upon which
Mr. Sherbanowski rests his claims for damages in this action is the same
factual basis upon which he rested his applications for disability awards under
section 45 of the Compensation Act – i.e. harassment and abuse prior to his
deployment to Bosnia; his possible exposure to uranium in Bosnia; and the
harassment and abuse following his return from Bosnia, including the
difficulties he claims he encountered in securing medical attention. His
Statement of Claim, in essence, reproduces the events Mr. Sherbanowski narrated
in the 16-page document attached to his application for PTSD benefits.
[44] Although Mr.
Sherbanowski pleads, in addition to his claims sounding in negligence, causes
of action framed in breach of fiduciary duty, breach of contract,
misrepresentation and breach of Charter rights, they all either arose out of,
or are directly connected with, his service in the Forces and they seek
compensation for disabilities or injuries resulting from a service-related
injury or disease: Compensation Act, ss. 2(1) and 45(1). Those
additional claims are “claims” within the meaning of section 9 of the CLPA
because any loss or damage claimed gives entitlement to payment of a pension or
compensation: Dumont v. Her Majesty the Queen, 2003 FCA 475 (CanLII),
para. 73.
[45] Mr. Sherbanowski has not pleaded a
recognizable cause of action in respect of [Veterans Affairs Canada’s] initial
denial of his applications. The governing statutory scheme afforded Mr.
Sherbanowski a right of appeal to the Board, which he utilized, and he was
successful on his appeals.
[36]
Recently, in Hardy Estate v Canada (Attorney
General), 2015 FC 1151 [Hardy Estate], Prothonotary Kevin R.
Aalto struck the action by a veteran’s estate (the Estate) under the CLPA
based, among other things, on section 9 of that Act. That case also had
similarities to the case at hand. Indeed, the veteran [Mr. Hardy], who was
seriously injured during military training in 1943, had taken steps the next
year to be compensated under the Act. Those efforts were unsuccessful,
according to the Estate, because of the failure of the Department’s employees
to help him complete the appropriate pension application. In 1975, Mr. Hardy
filed a new pension application, which was not processed and for which he again
did not receive any assistance from the Department. It was only 1997, following
a fourth attempt, that Mr. Hardy was granted a pension. He passed away two
years later (Hardy Estate, at paras 3 to 9).
[37]
In 2010, the Estate appealed the element of that
decision regarding the retroactivity of the pension. The estate claimed that
the pension should have been paid from the date of the first pension
application in 1944 or, alternatively, from the date of the application filed
in 1975. The Board ultimately recognized that the pension application filed by
Mr. Hardy in 1975 was satisfactory and well-founded and that the Department’s
failure to respond to that application was attributable to administrative difficulties
within the Department that were beyond Mr. Hardy’s control, meaning that, under
subsection 39(1) of the Act, Mr. Hardy would have been entitled to benefit from
the maximum retroactivity period set out in that provision, i.e. three (3)
years from the date on which the pension was granted (Hardy Estate, at
paras 10–11).
[38]
The list of remedies sought by the Estate was lengthy.
It is worth reproducing here, as it is largely similar to that of the plaintiffs
in the case at hand. Prothonotary Aalto gave the following list:
[14] The Claim
seeks a range of remedies. the remedies include the following:
a) A declaration that the Defendant
owed a duty of care to the Veteran and breached that duty causing the Veteran
and the Plaintiffs directly and indirectly physical and emotional distress,
loss of income, and humiliation;
b) The
Defendant breached the Plaintiffs’ rights pursuant to section 7 of the Charter;
c) Damages
pursuant to section 24 one of the Charter;
d) A
declaration of the limitation on the ability to correct errors or failures of
the Department pursuant to section 39 of the Pension Act violates
section 7 of the Charter and is therefore of no force in effect;
e) An
accounting of shortfalls in payment of pension benefits to the Veteran
retroactive to 1994 and restitution of benefits unfairly denied from 1943 to
1994;
f) Damages
for negligence including damages for mental suffering and distress;
g) Loss of employment;
h) Reduced capacity for employment;
i) An underpayment of pension
benefits;
j) Damages
for misfeance [in the exercise of a public office];
k) Damages
for vicarious liability for failing to adequately train and/or supervise
medical officers and personnel;
l) General damages;
m) Aggravated damages
n) Costs.
[39]
Prothonotary Aalto found that section 9 of the
CLPA provided a bar to the Estate’s claim because, in his view, that claim
stemmed from the fact that the conduct of the Department and the Board
prevented a proper pension, both in amount and the scope in time, being paid to
Mr. Hardy and his spouse and that it was then “an
action respecting a ‘pension or compensation […] out of the Consolidated
Revenue Fund or out of any funds administered by an agency of the Crown’ for, inter
alia, injury” (Hardy Estate, at para 66).
[40]
In the case at hand, there is no doubt that the
claims by Mr. Arial and his spouse are barred by section 9 of the CLPA. Their
daughter Sonia, on their behalf, is claiming pecuniary damages ($245,117.56 for
Mr. Arial, and $47,015.83 for his spouse), punitive damages, the amount of
which is left to the discretion of the Court, and non‑pecuniary damages,
the amount of which is also left to the discretion of the Court, for injury to
honour and human dignity in both cases, and for [translation] “loss of choices”
for Mr. Arial, and “increased responsibility”
for Ms. Arial.
[41]
As was the case in Hardy Estate, the
claims by Mr. Arial and his spouse all arise from the fact that, were it not
for the alleged wrongs by the Department and the Board, they would have been
awarded appropriate compensation under the Act, i.e. retroactive to March 1996,
the date of Mr. Arial’s first pension application. I note that, according to
paragraph 2 of the plaintiffs’ statement of claim, which I reproduced in
paragraph 23 hereof, this action was brought after the plaintiffs failed,
before this Court and the Federal Court of Appeal, to have the Board’s decision
following the decision by Shore J. in Arial 2011 overturned because the
Board allegedly failed, in their view, to comply with that judgment. The plaintiffs
feel that they had no choice, at that time, but to [translation] “take the necessary
steps to obtain reimbursement for harm caused by the infringement of their
right”.
[42]
We can but note the concordance between the
event for which Mr. Arial and his spouse were paid compensation under the Act
and the event that is the basis of this civil liability action, i.e. loss or
damage providing entitlement to a pension or allowance from the Consolidated
Revenue Fund—in this case, the losses and damages suffered by Mr. Arial during
his military service—, which pension or allowance allows for the payment of an
additional award when the processing of the pension application is affected by
administrative delays or difficulties beyond the control of the person applying
for the pension. I note that, in this case, the plaintiffs were not ultimately
granted the right to payment of the maximum compensation (Arial FCA, at
para 35).
[43]
That concordance did not escape Prothonotary
Tabib, who, as we have seen, found that the action by the plaintiffs was an
abuse of process in that the plaintiffs were seeking, for essentially the same
reasons, to recover the same amounts that they had unsuccessfully tried to
recover through the administrative process set forth in the Act. That finding is
just as relevant for the purposes of this motion to strike by the Defendant as
it was for the Board’s motion. Where Prothonotary Tabib saw, rightfully in my
view, an abuse of process as defined in Figliola, above, we must also
see, in light of the above, an estoppel under section 9 of the CLPA, regardless
of the nature of the head of damages claimed by the plaintiffs in this case,
even if those heads of damage are not the same as those compensated by the
pension (Sarvanis, at para 29).
[44]
It must be noted here that the vast majority of
the allegations by the plaintiffs against the authorities under the Act are
against the Board, as seen in paragraph 94 of their statement of claim. The plaintiffs
seem to accuse it, when it had the authority and power, of not having corrected,
as they wanted, the “original” error made in
1996 by employees of the Department and of thus having failed to comply with
the judgment issued by Shore J. in Arial 2011. I note here that the
action by the plaintiffs, in that it is directed against the Board, was deemed
inadmissible by Prothonotary Tabib.
[45]
Apart from that “original”
failure, the only allegations against the Department are therefore summarized
as (i) having done nothing after being advised three times that the Board had
twice changed Sonia’s testimony; (ii) having, with the Board, changed the
wording of the pension application for the duodenal ulcer, including the
problem of gastroesophageal reflux (GER), by issuing a decision solely on the
GER; (iii) having ignored the pension officer job description and manual, thus
contravening the Act; and (iv) not having respected the deadlines despite
numerous requests (see Statement of Claim, at paras 94(a), (b), (c), (f)
and (o)).
[46]
Once again, these failures are related to the
adequate nature of the compensation paid to the plaintiffs under the Act. Most
if not all were, or should have been, the subject of an action under the Act.
As such, they cannot be dissociated from [translation]
“an event already compensated” (Sarvanis,
at para 29). Under section 9 of the CLPA, they therefore cannot
constitute a civil liability action against the Defendant.
[47]
Having found that the claims by Mr. Arial and
his spouse are barred by section 9 of the CLPA, I must now examine the claim by
their daughter, Sonia, which is essentially related to her position as
representative for her parents. As I have already indicated, this claim
($410,084.33) totals more than half of the damages sought in the action. They
include an amount of $300,000.00 for hours worked defending the case and an
amount of $100,000.00 for [translation]
“lost wages, leave and illness for the case”.
The rest is related to various disbursements (Court costs, photocopies, legal
consultation, medical expenses, medication, etc.) related to the defence of the
case.
[48]
The Defendant claims that the damages sought by
Sonia are related to the event for which a pension was paid and therefore fall
under section 9 of the CLPA. It also claims that the amounts are in the nature
of costs, within the meaning of Rule 400, and that were up to Mr. Arial and his
spouse claim, as permitted by the Rules, in the various actions that they
launched to claim their rights under the Act.
[49]
I agree that the claim by Sonia is related to
the event for which a pension was paid in this case to Mr. Arial and that, in
essence, it is in fact in the nature of costs, which is an argument in favour
of its inadmissibility. However, it seems to me that the claim is inadmissible
in another regard. As I already stated, for all practical purposes, Sonia is
seeking to be compensated for her representation efforts, which, it must be
noted, were considerable. her dedication and tenacity were exemplary. She
defended the interests of her parents tooth and nail in a case in which the
roadblocks were many and, in some cases, avoidable. The Court can only salute
this ongoing effort.
[50]
However, is it enough for a decision against the
Defendant in favour of Sonia, who essentially acted as the agent for her
parents, a mandate that must also be assumed was at no cost, under the terms of
article 2133 of the Civil Code of Quebec? I do not believe so. In fact,
from the moment when she took over for her parents in 1999 in their efforts
with authorities responsible for application of the Act, Sonia acted in their behalf.
As such, she did not develop any legal ties to the Defendant regarding the
implementation of the Act. It was thus essentially for, and on behalf of, her
parents that she invested some 6,000 hours that she alleges to have spent on
the case. Her dealings with Defendant were always part of her mandate as
representative. At no time did Sonia deal with the Defendant on her own behalf.
[51]
For a legal relationship to be established
between Sonia and the Defendant under the CLPA, at least three elements must be
present: a fault, damage and a causal link between the fault and the damage
(Jean-Louis Baudouin and Patrice Deslauriers, La responsabilité civile,
8th Ed., vol. 1, Cowansville, Éditions Yvon Blais, at p. 115 [Baudouin
and Deslauriers]). Moreover, for there to be a causal link, the damage must
be “direct”, meaning that it must have been the
logical and immediate result of the fault. This principle reveals the desire of
Quebec courts, as civil law is the suppletive law here under the terms of
section 3 of the CLPA, to [translation]
“only retain as cause the event or events that
logically and intellectually are closely tied to the harm claimed by the victim”
and thus exclude from the causality “indirect”
damage , i.e. “damage resulting from the damage”,
or damage “for which the immediate source is not the
fault itself, but another harm already caused by the fault” (Baudouin
and Deslauriers, at pp. 720–721).
[52]
In this case, there is no doubt, in my view,
that the harm that Sonia feels she suffered is the result of the harm her
parents suffered from the actions taken against them by the Defendant, not the
actions themselves. Moreover, it is hard to imagine, for example, in a case
that proved longer and harder than anticipated because of the other party’s
actions, how a lawyer could sue that party to cover his or her fees and recover
damages suffered in carrying out that mandate. That right is instead the right
of the client if he or she is able to show in exercising his or her right to
take legal action that the other party acted in an objectionable manner (Hinse
v Canada (Attorney General), 2015 CSC 35, at para 170). It is therefore
damage suffered by the client, not by the lawyer, i.e. the client’s agent.
[53]
As currently worded, Sonia’s claim is only
related to her position as a representative, nothing more, and aims only for “damage resulting from the damage”, meaning that, on
that basis as well, it has no chance of success.
[54]
Does the fact that Sonia’s claim, and those of
her parents, are alternatively based on subsection 24(1) of the Charter
rescue the cause? The answer is no, as we saw in Dumont, Sherbanowski
and Hardy Estate. Indeed, section 9 of the CLPA refers to all
damages related to an event for which compensation has been or could be paid (Sarvanis,
at para 29). Moreover, the plaintiffs do not allege how, or even under what
provision(s), the Defendant in this case is liable under the Charter.
The statement of claim is totally silent in that regard. Thus, that in itself
is a bar to this alternative means. As the Federal Court of Appeal noted again
recently in Mancuso v Canada (National Health and Welfare), 2015 FCA 227
[Mancuso], an plaintiff must “plead, in summary
form but with sufficient detail, the constituent elements of each cause action
or legal ground raised”, failing which the pleading shall be struck”. As
such, the pleading must be detailed enough to “tell the
defendant who, when, where, how and what gave rise to its liability” (Mancuso,
at para 19).
[55]
This requirement, set out in Rule 174, applies
equally to matters related to the Charter. It is imperative (Mancuso, at
paras 20–21). However, it is lacking in this case.
[56]
Like all my colleagues before me, I sympathize
with the plaintiffs and this judgement will certainly not assuage their
frustration. However, my role is to assess the situation in light of the law.
Here, in my view, the claim by the plaintiffs fails.
[57]
It may be that the law is not generous enough
when compensating veterans whose cases encounter significant and repeated
delays that are beyond their control. However, as noted by Gauthier J., as he
then was, in Cadotte v Canada (Veterans Affairs), 2003 FC 1195, at para
22, it is important to recall that, despite its limitations, “the veterans’ pension scheme under the Act is a very
generous one”. It is also important, to put everything in perspective,
to recall the reasons behind the limitations to retroactivity in the payment of
pensions and allowances granted under the Act. To this end, I quote what the
Court said about this in Leclerc v Canada (Attorney General), [1998] FCJ
No. 153, 150 FTR 1:
[18] Just as the provisions of the Act
must be interpreted in such a way as to maximize payments for the benefit of
pensioners, so subsection 39(1) is clear as to its effects in the context of
this case. The purpose of that section is to limit the retroactive effect of
any pension awarded to a maximum of three years. The only exception to this
limitation is the one set out in subsection 39(2), which allows the Board to
make an additional award in an amount not exceeding the cumulative annual value
of two years pension.
[19] The limitation thus imposed on the
retroactive payment of pensions is made necessary by the legislative scheme
established for the benefit of pensioners. The effect of the scheme is that
once a pension is awarded it is always reviewable, and in the course of such
reviews the Board may have regard to any new evidence and amend its earlier
findings of fact or of law in the event that it considers them to be erroneous.
The reason why Parliament instituted a scheme that allows pensioners to present
any new fact or legal argument, at any time, that could affect the amount of
the pension paid to them, is to maximize the benefit derived from pensions and
also to recognize the fact that disabling physical conditions may change over
time. From the standpoint of the payer, however, this means that the financial
burden associated with the pension scheme is never ascertained with finality,
and it is in this context that Parliament deemed it advisable, through
subsection 39(1), to put a time limit on the retroactive effect of awarding a
pension.
[Footnotes omitted]
[58]
Once again, no one could claim that the scheme
created by the Act is not generous enough for people who, like Mr. Arial, had
to face difficulties — they who made the ultimate sacrifices for their country —
to obtain what they were ultimately entitled to under the terms of the Act.
However, it is up to Parliament, not the Court, to correct the situation, if it
is deemed that correction is needed.
[59]
The Respondent’s motion shall therefore be
allowed, and the plaintiffs’ action struck, insofar that it is directed against
the Defendant. Like Prothonotary Tabib, I find that the action must be struck
without leave to amend, as it includes flaws that cannot be remedied by
amendments.
[60]
The Defendant was only seeking costs if its
motion were challenged. Technically, it would therefore be entitled to costs,
as its motion was challenged, and allowed. However, exercising my discretion
under Rule 400, I find that this case does not lend itself to an awarding of
costs against the plaintiffs.
[61]
Each party shall therefore pay their own costs.
JUDGMENT
THE COURT
ORDERS that:
- The motion is
allowed;
- The action by
the plaintiffs, insofar as it is directed against “Her
Majesty the Queen in Right of Canada on behalf of the Department of
Veterans Affairs” is struck without leave to amend;
- Without costs.
“René LeBlanc”
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