Date: 20100914
Docket: T-502-09
Citation: 2010 FC 919
Edmonton, Alberta, September 14, 2010
PRESENT: The Honourable Mr. Justice Hughes
BETWEEN:
NORMAN AMAHOOSE, WALLACE MOUNTAIN,
HENRY J. WATCHMAKER, ELAINE WATCHMAKER,
ELMER PAUL, VERNON BADGER, SIDNEY PAUL
and JOSEPH WALTER WATCHMAKER
Applicants
and
THE CHIEF AND COUNSEL OF KEHEWIN
CREE NATION,
and THE DEPARTMENT OF INDIAN AFFAIRS
Respondents
REASONS FOR JUDGMENT AND JUDGMENT
[1]
This
is an application for mandamus to require that the Respondent Chief and
Counsel of the Kehewin Cree Nation engage an external auditor to audit its
accounts for all years that an audit has not been performed and that such
audits be posted in a conspicuous place on the Band Reserve for examination by
the Band members within seven (7) days of the completion of said audits. For
the reasons that follow I am dismissing the application with no costs awarded
to any party.
[2]
The
Applicants Norman Amahoose et al are members of the Kehewin Cree Nation. They
are not the Chief nor members of the Counsel of that Nation. The Respondents
are the Chief and Counsel of the Kehewin Cree Nation. Originally the Department
of Indian Affairs was also a named Respondent however this application was
discontinued as against that party. Consequently nobody appeared or made
representations on behalf of the Department of Indian Affairs or Indian and
Northern Affairs Canada (INAC) as it is sometimes called.
[3]
It
is common ground between the parties that the financial affairs of the Kehewin
Cree Nation are in a mess. In 1995 a substantial audit and report referred to
as the Browning Report was conducted and delivered outlining in detail many of
the financial difficulties encountered. Since that time, it is agreed between
the parties, audit reports of the kind contemplated by section 8(1) of the Indian
Band Revenue Moneys Regulations, C.R.C., c. 953 have been prepared and
posted, however the Applicants argue that they are inadequate in revealing its
nature and extent of the financial difficulties. In the record before me are
audit reports for the year 2006, 2007 and 2008. The Applicants argue that these
reports are inadequate and that something in the nature of the Browning Report
is required for each year since 1995. The evidence before me is that to prepare
audit reports of the nature and extent sought by the Applicants would cost in
the area of at least $70,000 to $100,000 per year and then only if the
appropriate records could be located. I have no evidence as to the whether the
appropriate records still exist and can be located. In brief the Applicants
seek a form of relief that, even if it is possible, would cost at least one
million dollars. Nobody knows who would pay for this. Some of the Applicants in
their evidence speculate that INAC would pay but there is certainly no evidence
that INAC is obliged to pay or would be willing to pay for such audits.
[4]
There
is no doubt that the financial affairs of the Kehewin Cree Nation are a mess.
The affidavit evidence of Chief Ernest Gadwa acknowledges this and states that,
in his belief, the worst is over. In cross-examination he acknowledged that a
number of financial administrators have, in succession, been engaged to put the
situation back on track. At the hearing before me Counsel for the Applicants
and Respondents acknowledged and agreed that I may take into account that INAC
has since the institution of the present application, placed the Kehewin Cree
Nation under its direct administration. There is, however, a Court challenge in
respect thereof presently under way.
[5]
The
evidence, particularly in the cross-examination transcripts of the individual
Applicants, is clear that there is no allegation of fraud being made by the
Applicants, simply mismanagement.
[6]
Applicants’
Counsel argues that the relief requested is the only way that the members have
to evaluate the situation to know fully and correctly the actual state of
financial affairs of the Nation. Without that evaluation, it is argued, there
is no way that the members can appreciate what appropriate remedies may be
proposed or taken to rectify those affairs. As to the cost, it is argued, the
audits could take place over a period of time and the savings that the audits
would reveal could be used offset the cost of the audit.
[7]
Respondents’
Counsel argues that the Chief and Counsel are well aware of the financial
difficulties and are taking reasonable steps to address them. In addition to
submitting the audit reports as required by section 8 of the Regulations,
supra, financial administrators have been engaged and, now, the Nation is under
direct administration, albeit challenged, by INAC. It is argued that the
recovery of cost of the audit as proposed by the Applicants is speculative and
that the revelations, if any, of such an audit are also speculative.
[8]
Section
44 of the Federal Courts Act, R.S.C. 1985, c F-7 makes it clear that any
award of mandamus of the nature sought by the Applicants herein is a
discretionary remedy:
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44.
In addition to any other relief that the Federal Court of Appeal or the
Federal Court may grant or award, a mandamus, an injunction or an order for
specific performance may be granted or a receiver appointed by that court in
all cases in which it appears to the court to be just or convenient to do so.
The order may be made either unconditionally or on any terms and conditions
that the court considers just.
R.S.,
1985, c. F-7, s. 44; 2002, c. 8, s. 41.
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44.
Indépendamment de toute autre forme de réparation qu’elle peut accorder, la
Cour d’appel fédérale ou la Cour fédérale peut, dans tous les cas où il lui
paraît juste ou opportun de le faire, décerner un mandamus, une injonction ou
une ordonnance d’exécution intégrale, ou nommer un séquestre, soit sans
condition, soit selon les modalités qu’elle juge équitables.
L.R.
(1985), ch. F-7, art. 44; 2002, ch. 8, art. 41.
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[9]
Justice
Phelan of this Court set out the considerations that must be made in exercising
such discretion in Ermineskin Indian Band and Nations v. Canada, September
23, 2008, 2008 FC 1065 at paragraph 31:
On the issue of mandamus, the Court of
Appeal in Apotex v. Canada (A.G.), [1994] 1 F.C. 742
(F.C.A.), held that the principles applicable to mandamus are:
1. There must be a public duty to
act.
2. The duty must be owed to the
applicant.
3. There is a clear right to
performance of the duty, in particular:
(a) the applicant has satisfied
all conditions precedent giving rise to the duty;
(b) there is (i) a prior demand
for performance of the duty; (ii) a reasonable time to comply with the demand
unless refused outright; and (iii) a subsequent refusal which can either be
expressed or implied, e.g. unreasonable delay;
4. Where the duty sought to be
enforced is discretionary, the following rules apply:
(a) in exercising a discretion,
the decision-maker must not act in a manner which can be characterized as
“unfair”, “oppressive” or demonstrate “flagrant impropriety” or “bad faith”;
(b) mandamus is unavailable if the
decision-maker’s discretion is characterized as being “unqualified”,
“absolute”, “permissive” or “unfettered”;
(c) in the exercise of a
“fettered” discretion, the decision-maker must act upon “relevant”, as opposed
to “irrelevant”, considerations;
(d) mandamus is unavailable to
compel the exercise of a “fettered discretion” in a particular way; and
(e) mandamus is only available
when the decision-maker’s discretion is “spent”; i.e. the applicant has a
vested right to the performance of the duty. (emphasis added by Court)
[10]
Counsel
agreed that, as a general principle, the Chief and Council of a Band or Nation
such as the Respondents here are in a fiduciary relationship with the members
of the Band or Nation. They both acknowledge this principle as set out by Skipp
J. in Williams Lake Indian Band v. Abbey, [1992] 4 C.N.L.R. 21,
[1992] B.C.W.L.D. 1783 at paragraph 14:
There can be no question that a
duly-elected chief as well as the members of a Band Council are fiduciaries as
far as all other members of the Band are concerned.
[11]
However,
in the present case, I am satisfied that the Chief and Counsel have not acted
improperly or in an unfair or oppressive manner or in bad faith. I am satisfied
that the Chief and Counsel are aware of the problems and are taking measures to
address them.
[12]
I
am not satisfied that the remedy sought in the present application will be
likely to have any real effect in improving the situation. At best the effect,
if any, is largely speculative. The cost of the proposed remedy is
proportionately quite large and it is by no means clear who, if anyone, will
bear the cost.
[13]
Under
the circumstances therefore, I decline to exercise my discretion and will not
order the mandamus sought.
[14]
As
to costs I am satisfied that each party should bear its own costs, therefore I
will make no order as to costs.
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