Randall v. Caldwell First Nation of Point Pelee, 2002 FCT 31

Date: 20020114

Docket: T-850-99

Neutral citation: 2002 FCT 31

BETWEEN:

         PHYLLIS RANDALL, LONNIE DODGE, JOSIE DODGE, ROBERT K. SCOTT,

                         BRIAN WELCH, FLOYD SCOTT, ANTHONY DODGE (A.K.A.

        ARTHUR DANIEL SIMONS), MABEL HAWCO, CHRISTOPHER HAWCO SR.,

                        SUSAN DE LEARY, WILLIAM DELEARY, LISA BRUMMITT,

         LAURA BRUMMITT MERCER, WALLACE KENNEY, RENA H. THOMPSON,

                          PAMELA DODGE, TERESA JACOBS, ELLA ROBITAILLE,

                     CAROLINE JUNE WELCH, TONY DONOVAN, JO ANN WILSON,

          ROBERT DODGE, JOSEPH CHAMBERLIN, MARGARET VANDERWEIDE,

                 MARIE DUCKWORTH, SHAWN DUCKWORTH, IAN DUCKWORTH,

                        DAVID MCPHEE, JANICE DODGE, DANIEL CHAMBERLIN,

                    NANCY LAMOREUX, JAMES ALLAN DODGE, SANDRA DODGE,

       WENDY DONOVAN CAMPBELL, DARRYL R. JACOBS, EDWARD A. JACOBS,

                        ANGELA HIGGINS, WILLIAM DODGE, FLORENCE DODGE,

          STANLEY JAMES SCOTT, STEVEN SCOTT, DANIEL SCOTT, JACK SCOTT,

                          MARY FRANCES DUCKWORTH, CANDICE BRUMMITT,

            VICKY BAKELAAR-CORNELL, MICHAEL CORNELL, WILLIAM DUNN,

                         SARA ANN SCOTT, PAT BRUMMITT, WILSON DODGE SR.

                    ELIZABETH DODGE, WILSON DODGE, JR., WILSON DODGE III,

                               MYRTLE JOYCE, EVA TYLER, RONALD DOOLITTLE

                                                                                                                                                      (Plaintiffs)

                                                                                 and

                                 CALDWELL FIRST NATION OF POINT PELEE AND

                  PELEE ISLAND COUNCIL, LARRY JOHNSON, HENRY SOLOMON,

                                   FRANKLIN SOLOMON and DONALD SOLOMON

                                                                                                                                               (Defendants)

                                                                                                                                       Docket: T-1230-99

AND BETWEEN:

             LOUISE HILLIER, JANNE PETERS, MELODY WATSON, JIM PETERS,

                        SUSIE PETERS, VIDA PETERS, ERIC PETERS, JUNE PETERS

             CARRIE PETERS, JODY PETERS, LINDSAY PETERS, RALPH PETERS,

                         GERALDINE PETERS, YVONNE PETERS, DAVID HILLIER,

                     DENNIS HILLIER, KEN FORD, MARGARET PETERS-NELNOR,

          ISAAC PETERS, DIANE PETERS, DANIELLE PETERS, ISAAC PETERS, JR.,

                          MILDRED FORD, JANET ALLEN, ELIZABETH WENZLER,

                                             RUTH SIMPSON AND STEVE SIMPSON

                                                                                                                                                      (Plaintiffs)

                                                                                 and

                                 CALDWELL FIRST NATION OF POINT PELEE AND

                  PELEE ISLAND COUNCIL, LARRY JOHNSON, HENRY SOLOMON,

                                   FRANKLIN SOLOMON and DONALD SOLOMON

                                                                                                                                               (Defendants)

                                                            REASONS FOR ORDER

SIMPSON J.

Introduction

[1]                 These consolidated proceedings (the "Action") were initiated by Phyllis Randall et al ("Plaintiff Randall") and Louise Hillier et al ("Plaintiff Hillier") (collectively the "Plaintiffs") against the Caldwell First Nation of Point Pelee (the "Band"), Pelee Island Council (the "Council"), Larry Johnson, who has been Chief of the Band since 1987 ("Chief Johnson"), and two other individual defendants (collectively, the "Defendants").

The Action

[2]                 In the Action, the Defendants are the incumbent Band leadership and the Plaintiffs are a group of Band members and others who seek to oust and replace the current leadership. Both groups depend on and are competing for the goodwill and support of the balance of the members of the Band. Accordingly, each group has an incentive to generate publicity that favours it and demeans its opponents.

[3]                 The Plaintiffs in the Action allege, inter alia, that the Council, Chief Johnson and the Defendants negotiated a settlement agreement with the Crown dated January 24, 2000 (the "Settlement Agreement") without the authority or knowledge of the Band; that the Council and Chief Johnson have refused to call an election for Chief since 1990; and that the Council and Chief Johnson have improperly altered the Band's membership and voters' lists. In particular, the Plaintiffs have alleged that many of the current Band members who are not parties to the Action are not entitled to Band membership.

This Contempt Proceeding

[4]                 In this proceeding, the Plaintiffs allege that Chief Johnson should be found in contempt because he has used information obtained through the discovery process for the purpose of currying favour with Band members. They say that this purpose is extraneous to the litigation and therefore violates the Implied Undertaking. At Common Law, the Implied Undertaking is an unwritten litigation rule that imposes confidentiality on information obtained during the production of documents and oral examinations for discovery and prevents it from being used for purposes outside the litigation. In some jurisdictions, the Implied Undertaking has been included in the Court's rules of practice (see, for example, Rule 30.1 of the Ontario Rules of Civil Procedure, R.R.O. 1990, Reg. 194). However, it is not disputed that the Implied Undertaking applies in the Federal Court in its Common Law form. All Counsel agree that Madam Justice Reed's decision in Canada v. Ichi Canada Ltd., [1992] 1 F.C. 571 sets out the relevant law in this regard.

[5]                 The Plaintiffs' main contention is that Chief Johnson learned which Band members' credentials were being questioned during examinations for discovery and that he breached the Implied Undertaking when he widely publicized that information and when he contacted those individuals to tell them that their status had been questioned.

[6]                 The Plaintiffs ask that Chief Johnson be ordered to pay a $1000 fine; that he be enjoined from future breaches of the Implied Undertaking; that he be ordered to print a statement that includes an apology in a Band Newsletter to be circulated to all Band members; and that he be ordered to pay, within a reasonable time, the Plaintiffs' costs both of this motion and of the show cause hearing before Prothonotary Lafrenière. The Plaintiffs ask that their costs be fixed on a solicitor and client basis in the amount of $10,000 for Mr. Kevin Ross ("Ross") who is counsel for the Plaintiff Hillier in action T-1230-99 and lead counsel in this proceeding and $3,500 for Mr. Stanley Mayes ("Mayes"). Mayes is counsel for the Plaintiff Randall in action T-850-99 and he played a supporting role in this proceeding.

The Evidence

[7]                 The Plaintiffs' evidence was set out in an affidavit of Nancy Pollard sworn on November 24, 2000. On consent, an abbreviated version of her affidavit and a brief containing only its most relevant exhibits were used in argument. The Plaintiffs also handed up two items of recent correspondence dated September 13 and October 3, 2001 that showed that, just before the hearing, the parties had tried to settle this matter. However, the discussions ended when Chief Johnson withdrew an outstanding offer. Mayes relied on three additional items of correspondence dated May 18, 2000, May 23, 2000 and June 19, 2000. The Plaintiffs did not call any oral evidence.

[8]                 Counsel for the Defendants in the Action is Mr. James Mays. He also represents Chief Johnson in this contempt proceeding and will be referred to in these reasons as "Defendants' Counsel". Chief Johnson, who is the only defendant alleged to be in contempt, was present in Court for the contempt hearing but did not testify. The evidence on his behalf was also filed on consent and consisted of an Exhibit Brief of five documents.

The Alleged Breaches of the Implied Undertaking

[9]                 During the Examination for Discovery of the plaintiff, Mabel Hawco, on September 7, 1999, Defendants' Counsel questioned her about her criticism of the Band's membership and voting lists. She provided the names of some Band members whom she said were not entitled to be listed and undertook to provide further information about objectionable names.

[10]            On May 18, 2000, Chief Johnson sent a letter to all Band Members that stated in part:

Voters List Debate:

Dissident band members and non-member dissident (sic) have mentioned many names whom they think should be removed. So far we have to report that members of many Caldwell families have been mentioned or discussed by dissidents for possible removal from voters list or band list or both.

A non-member dissident, Mabel Hawco has said that no one should be a band member until he or she turns eighteen. Of course, we as a Council disagree with this. This non-member has suggested the following names should be removed from the voters list, band list or both.

Charlotte Allard       Milton Yon                 Wilson Dodge                        Linda Deleary

Natalie Fletcher        Frank Gratton             Larry Johnson                        Marilyn Gratton

Marion Johnson       Wayne Gratton           David L. Welch                      Clarence Gratton

Tina Welch              Herbert Gratton          Willy Deleary                        Fox family

Wanda Kenney

The dissident non-member also objects or is questioning the following children as Caldwell Band Members;

Amanda Johnson     Nadine Lewis              Jennifer Johnson Paul Lewis

Charley Johnson      Taylor Derbyshire    Robin Van Oirschot              Katie Welch

Matthew Watson     David Watson             Brenda R. Welch

Mrs. Hawco claims that one voting member in particular has passed away, but according to the Council, the concerned voting member is living in the Leamington area. It should be mentioned that the above lists of adults and children are not yet finalized by the litigants. Once we have heard from the litigants through the legal system they may have deleted or added names.

Phyllis Wilson thinks that myself am not a member and may be from another band.

Dissident Caroline Welch has made legal statements calling or suggesting for removal of the following names:

Myrtle Joyce           Elizabeth Dodge            William Dodge    Florence Dodge

Denise Dodge           Wilson Dodge III          David L. Welch Tina Welch

Plus the children of David L. Welch and Tina Welch

Once we have heard from dissidents and their legal counsel, it will be known whether they want less or more band members removed from the band list or voters list or both. We are hoping numbers of names potentially listed by the dissidents will reduce rather than increase.

[my emphasis]

[11]            It is not disputed that the information in the letter of May 18, 2000 came in part from the Plaintiffs' Examinations for Discovery. This is said to be a breach of the Implied Undertaking because Chief Johnson identified Mabel Hawco and the position she took on her examination concerning which Band Members should be removed from the Band's membership and voting lists.

[12]            On May 23, 2000, Mayes sent Defendants' Counsel a lengthy letter (the "Mayes Letter") in which he provided an overview of his clients' position in the Action and criticized the Defendants' failure to answer their undertakings in a timely way. Mayes then listed the names of those individuals whom his clients said should be added to and deleted from the Band's voters' list.

[13]            The proper characterization of this letter is at issue. The Plaintiffs say it was sent in the conduct of the Action to answer undertakings given on Examination for Discovery. However, Defendants' Counsel says that it was sent outside the Action in furtherance of a settlement process initiated by the Case Management Judge.

[14]            In this regard, he relies on Reasons for an Order issued by the Case Management Judge on April 14, 2000. Therein the Judge granted an injunction restraining the Defendants from holding a vote to ratify the Settlement Agreement. After making her decision, she added the following statements which I will describe as the "Comments":

[67]          ... Hopefully, the plaintiffs will make whatever submissions they think necessary or appropriate to the defendants with respect to any amendment of the voters list in an effort to see that a ratification vote may be held by a proper electorate.

[68]          I am equally hopeful that the defendants would properly consider any such submissions.

[15]            Defendants' Counsel says that the Comments constitute a "direction" from the Case Management Judge to the Plaintiffs to make submissions to the Defendants about amendments to the voters list, and a direction to the Defendants to consider any such submissions. He describes this as a "process" that is separate from the Action and says that, for this reason, the Implied Undertaking is not applicable. He also says, in the alternative, that, if the Implied Undertaking applies, the Case Management Judge's "direction" must be taken to exempt the parties from its application because the process of settling the voters' list requires that non-party band members, whose presence on the list is challenged, be contacted for information about matters such as their lineage and proof of their Indian status.

[16]            I agree with Defendants' Counsel that the Mayes Letter was written further to the Case Management Judge's Comments of April 6, 2000 and not in an effort to answer the undertakings given by his clients on their examinations for discovery. I have so concluded because the letter refers to the Case Management Judge when it states at the top of page 2: "[i]t has been requested that we provide the Defendant Council with a list of names to be added to the voters' list and deleted from the voters' list. The Justice assumed that the Defendants would make changes, but we fully expect that since the Plaintiffs are alleging that the Defendants themselves manipulated the list that no changes were made." As well, the Mayes Letter nowhere mentions the Plaintiffs' undertakings and does not refer to their examinations for discovery, even though several days earlier Defendants' Counsel had written Mayes a letter listing his clients' undertakings by page and question number.

[17]            However, I am not persuaded that the Comments are properly characterized as a "direction". All Her Ladyship expressed was the hope that meaningful settlement discussions would occur. Nothing she said made such discussions mandatory and nothing she said could reasonably have been understood to exempt Chief Johnson from the Implied Undertaking. While the Court can exempt parties in proper circumstances, it is my view that the issue must be raised in a motion for that purpose and an exemption must be expressly granted. Accordingly, the Comments do not excuse any breaches of the Implied Undertaking.

[18]            On June 13, 2000, Chief Johnson is alleged to have breached the Implied Undertaking a second time when he sent a letter to twenty-seven Band Members whose Band membership credentials had been questioned by the Plaintiffs. All those who were sent the letter had been named in the Mayes Letter.

[19]            The body of the letter said:

Further to recent correspondence to you we are in the process of defending your rights as a Caldwell Band member and voter in band business.

We are not overly concerned and expect to defend your rights with success. Those suing the Council are likely attempting to change the voters list to suit their needs, but we have to respond legally to all arguments even if such arguments are of a seemingly ridiculous nature.

With the above in mind we have scheduled a meeting this Friday, June 16^th from 11:00 am on, at the band office for any band members affected by these latest legal arguments. Members of Council and our lawyer will be present.

You are invited to attend or phone during this meeting if you have questions or want to say anything concerning your rights as a member.

Please call if you have any questions and if possible, I hope to see you this Friday.

[20]            It also appears that earlier, on June 9, 2000, a different but comparable letter was sent to April Birch, another non-party. It invited her to attend a Council meeting to discuss the fact that the Plaintiffs had "...pointed out your name for removal from the voters' list ..." This letter is also said to have breached the Implied Undertaking because it advised a non-party that the Plaintiffs had taken the position in the Action that her entitlement to vote was at issue.

[21]            On June 15, 2000, Defendants' Counsel was informed of the substance of this contempt complaint in a telephone conversation with Ross who asked him to "instruct his client to discontinue his wrongful conduct, namely to refrain from contacting non-parties regarding the issues of litigation". At that time, Defendants' Counsel informed Ross that the letters written by Chief Johnson were written "with his knowledge and in accordance with his instructions". Ross then asked Defendants' Counsel to stop communicating information from the Action to non-parties and Defendants' Counsel refused. This conversation was followed up with letters to Defendants' Counsel from both Ross and Mayes dated June 19, 2000. Those letters described the Implied Undertaking and alleged its breach.

[22]            The Band Council Meeting of June 16, 2000 (the "Meeting") proceeded in spite of the Plaintiffs' objections. Defendants' Counsel attended and the minutes show that the Council considered the names put in issue in the Mayes Letter. However, they do not show whether any non-parties who received an invitation to the meeting were present.

[23]            After the Council meeting, Chief Johnson released information in the form of two Press Releases, dated July 11 and July 28, 2000, which were circulated to Band members and members of the public. In those releases, he indicated that the Plaintiffs sought to remove thirty-three Band members from the voting list. In a further press release of August 1, 2000, he spoke about admissions made by Teresa Jacobs during her cross-examination. As well, Chief Johnson sent out two further documents. One was a Message to Band Members and the other one was a Chief's Message. They reported on the Action and indicated that the Plaintiffs sought to remove approximately thirty-three band members from the voters' list.

The Burden of Proof

[24]            Defendants' Counsel submitted that, unless the Plaintiffs proved beyond a reasonable doubt that Chief Johnson knew about the Implied Undertaking and had the required mens rea, he could not be found to be in contempt. He relied, in particular, on the Supreme Court of Canada's decision in Bhatnager v. Canada (Minister of Employment and Immigration), [1990] 2 S.C.R. 217 ("Bhatnager"). In that case, two Ministers of the Crown were alleged to be in contempt of an Order of a Judge of the Federal Court Trial Division made in open court in the presence of counsel for the Ministers. As well, the Order was formally served on counsel. However, there was no evidence that the Order was personally served on the Ministers or that they were told of its existence.

[25]            The Supreme Court held that the elements of contempt must be proved beyond a reasonable doubt. As well, the Court held that, at Common Law, personal service or actual personal knowledge of an order was a condition precedent to a finding of liability for contempt and concluded that, since there was no evidence that the Ministers had been informed of the existence or content of the Order, they could not be found in contempt. Given that the Ministers were responsible for busy government departments, the Court was not prepared to infer that they had knowledge only because their counsel had been served. However, the Court acknowledged that such an inference could be drawn in proper circumstances.

[26]            Defendants' Counsel also relied on Lyons Partnership, L.P. v. MacGregor, [2000] F.C.J. No. 341, in which Lemieux J. of this Court said the following at paragraph 5:

An allegation of contempt of court is a matter of criminal or quasi-criminal dimension; a finding of guilt subjects a defendant to a fine and the possibility of imprisonment to a maximum of five (5) years. The Federal Court Rules, 1998, which themselves on this point are a codification of the common law, require the constituent elements of contempt must be proven beyond a reasonable doubt (Bhatnager v. Canada (M.E.I.), [1990] 2 S.C.R. 217. Those constituent elements, the onus of proof which is upon the plaintiff, are: a Defendants' actual personal knowledge of the Court's order; the defendant is the primary actor either actually or by express or implied authorization; and the required degree of mens rea.

[27]            On reflection, I am not persuaded that these decisions assist Chief Johnson. They deal only with contempt of Court Orders. Court Orders do not exist until they are made by a Judge and therefore the requirement for actual knowledge of their provisions makes sense. However, the situation in this case is different. Here, Chief Johnson is alleged to be in contempt because he has breached a Common Law Rule. The Implied Undertaking has existed for a long time and is part of the law of Canada governing the orderly administration of justice. In my view, in cases such as this, the requirement of actual knowledge is displaced by the fact that Chief Johnson is presumed to know the law.

Conclusions

[28]            I am satisfied beyond a reasonable doubt that Chief Johnson is in contempt of the Implied Undertaking. I am persuaded that, without an exemption from the Implied Undertaking, he took information obtained in the Action and publicized it broadly both within and beyond the Band in an effort to outrage Band members and the press and rally them to his support in the dispute. For this reason, I have concluded that his letter of May 18, 2000 to all Band members and the five communications described in paragraph 23 herein breached the Implied Undertaking.

[29]            However, it seems to me that some of Chief Johnson's conduct cannot be described as extraneous to the litigation. In my view, the Action requires the Defendants to show that the non-parties identified for challenge by the Plaintiffs are entitled to Band membership. Accordingly, it was not a breach of the Implied Undertaking for Chief Johnson to write on June 9 and June 13, 2000 to those non-parties who were directly affected and then hold a meeting to discuss the information needed to respond to the challenge to their Band membership and voting rights.

The Remedy

[30]            An order will be issued requiring Chief Johnson to publish a statement explaining these contempt proceedings and their outcome and requiring him to obey the Implied Undertaking until further Order of this Court. This statement will not include an apology because I think it likely that Chief Johnson acted on incorrect advice provided by Defendants' Counsel. Chief Johnson will also be ordered to pay certain costs within 120 days. I will not impose the $1000 fine Plaintiffs seek because it was only requested after Chief Johnson withdrew his settlement offer at the last minute and left the Plaintiffs scrambling to come to Court. In my view, although this conduct was undoubtedly annoying, it does not justify a fine.

             "Sandra J. Simpson"                                                                                                                                    JUDGE

Ottawa, Ontario

January 14, 2002