Date: 20171207

Docket: T-1004-17

Citation: 2017 FC 1124

[ENGLISH TRANSLATION]

Ottawa, Ontario, December 7, 2017

PRESENT: The Honourable Madam Justice Roussel

ORDER AND REASONS

I.                    Introduction

[1]               In a motion filed under Rules 221(1)(a), 221(1)(f) 369 of the Federal Court Rules, SOR/98-106 [Rules], the Attorney General of Canada, on behalf of the respondent, Her Majesty the Queen in Right of Canada, is seeking to have the entire statement by the applicants struck without possibility of amendment. She is also seeking to have the style of cause amended to have “Her Majesty the Queen in Right of Canada” designated as respondent.

[2]               In that statement, submitted on July 10, 2017, the applicants seek compensation for wrongs and violations allegedly committed against them by representatives of the Department of Veterans Affairs [DVA] in processing applications for pensions and other benefits filed by the applicant, the late Maurice Arial [Mr. Arial] and, following his death, by his surviving spouse, Madeleine Arial [Ms. Arial], under the Pension Act, RSC (1985), c. P-6 [PA]. Their daughter, Sonia Ariel, herself an applicant, obtained authorization to represent her mother in an order from this Court on August 15, 2017.

[3]               The respondent claims that the statement must be struck without possibility of amendment because it reveals no reasonable cause of action or is an abuse of process.

[4]               After examining the documentation submitted by the parties and their written submissions, the Court feels that the motion should be allowed, for the following reasons.

II.                 Background

[5]               The underlying facts in this case date back more than twenty (20) years and led to numerous cases before the Veterans Review and Appeal Board [VRAB], this Court and the Federal Court of Appeal (Arial v Canada, 2017 FC 270 [Arial 2017]; Order by Madam Prothonotary Mireille Tabib, docket T-1505-15, April 25, 2016; Arial v Canada (Attorney General) 2014 FCA 215; Arial v Canada (Attorney General), 2013 FC 602 [Arial 2013]; Arial v Canada (Attorney General), 2010 FC 184; Arial v Canada (Attorney General), 2012 FC 353; Arial v Canada (Attorney General), 2011 FC 848; Arial v Canada (Attorney General), 2010 FC 184 and Order by Danièle Tremblay-Lamer J., docket T-1739-10, December 16, 2010).

[6]               For the purposes of this motion, there is no need to relate the entire factual background, which is reiterated in Arial 2017 and in Arial 2013. The following should be noted.

[7]               The applicant, Mr. Ariel, is a veteran who served in the Canadian Navy during the Second World War. In March 1996, he submitted his first application for a disability pension due to stomach problems related to his military service. Due to the lack of a medical report, Mr. Arial’s file was closed on September 27, 1996.

[8]               On October 13, 1999, Mr. Arial appointed his daughter as his designated representative.

[9]               After several years, multiple recourses, and his death on September 25, 2005, Mr. Arial’s right to a full pension and a care allowance was recognized, but only retroactively. The effective date of the pension granted to Mr. Arial was set at October 30, 2004, three years prior to the date on which it was granted, on October 30, 2007 (paragraph 56(1)(a.1) of the PA). He was also granted an additional award of twenty-four (24) months, in accordance with subsection 56(2) of the PA, due to administrative delays or difficulties beyond the control of the applicants.

[10]           On September 4, 2015, the applicants commenced an action before the Federal Court against the respondent, in which they sought compensation for wrongs allegedly committed against them by VRAB and DVA employees in processing the pension and allowance applications filed by Mr. Arial under the PA and continued by Ms. Arial following his death.

[11]           In October 2015, the VRAB and the respondent, Her Majesty the Queen in Right of Canada, on behalf of the DVA, each filed a motion to strike the statement without possibility of amendment.

[12]           On April 25, 2016, Madam Prothonotary Tabib allowed the VRAB motion and struck the applicants’ action against it, without possibility of amendment, judging that the action was an abuse of process and that it was contrary to the immunity of the VRAB. At the same time, she issued a directive inviting the parties to make additional submissions regarding paragraph 35 of the reasons of the Honourable Mr. Justice Yvan Roy in Arial 2013, which seemed to leave the door open to civil liability action in the circumstances of this case.

[13]           After hearing the parties on November 17, 2017, Justice René Leblanc allowed the motion to strike the action commenced against Her Majesty the Queen in Right of Canada on behalf of the DVA without possibility of amendment, finding that it had no chance of success and constituted an abuse of process (Arial 2017, at para 25).

[14]           According to LeBlanc J. (Arial 2017, at paras 29–30), section 9 of the Crown Liability and Proceedings Act, RSC (1985) c. C-50 [CLPA] constitutes an estoppel to the civil action taken by the applicants, as that provision prevents double recovery of any damages arising from a single event for which a pension or compensation has already been paid. That prohibition also applies to a head of damage that “did not match the apparent head of damages compensated for in that pension” (Sarvanis v Canada, 2002 SCC 28, at para 29). The purpose of this principle is to avoid “Crown liability under ancillary heads of damages for an event already compensated” [ibid].

[15]           LeBlanc J. then addressed the claim by Sonia Arial and found that there was no legal relationship between her and the respondent under the CLPA. As her claim was essentially related to her role as her parents’ representative, she cannot be compensated for damages that arise, not from the wrong itself, but from another harm (Arial 2017, at paras 49–51).

[16]           Finally, LeBlanc J. dismissed the applicants’ argument based on subsection 24(1) of the Canadian Charter of Rights and Freedoms, Part 1 of the Constitution Act, 1982, being Schedule B to the Canada Act 1982 (UK), 1982, c. 11 [Canadian Charter] on the grounds that section 9 of the CLPA includes all damages related to the event for which compensation has already been paid or could be paid. He also notes that the applicants did not allege how or on what basis the respondent was liable under the Canadian Charter (Arial 2017, at para 54).

[17]           Neither the order by Madam Prothonotary Tabib nor the order by LeBlanc J. are being appeal by the applicants.

[18]           On July 10, 2017, the applicants again commenced an action to claim damages for wrongs and violations allegedly committed by DVA representatives, based on the VRAB, the Canadian Charter and the Charter of Human Rights and Freedoms, CQLR, c. C-12 [Quebec Charter]. In general, they accuse them of having failed or refused to provide Mr. Arial and his spouse with the assistance and support set out in subsection 81(3) of the PA, thus failing in their [translation] “contractual and extra-contractual obligations (sic), their duty of due diligence and [their] duty as trustee to the applicants”. They claimed that, were it not for the misconduct of the DVA representatives, Mr. Arial would have been granted the right to the full pension and an allowance retroactive to March 1996 and Sonia Arial would not have had to spend more than 6,000 hours defending the case and incurring costs, including medical costs and lost wages. They therefore seek to [translation] “obtain damages for heinous wrongs not compensated by the system”.

[19]           This latter statement, which is the most recent stage in a long legal saga, is the subject of this motion to strike submitted by the respondent.

III.               Analysis

[20]           In support of her motion to strike, the respondent alleged that the statement by the applicants does not reveal any reasonable cause of action within the meaning of Rules 221(1)(a) and (f), for three (3) reasons: (1) there is res judicata under article 2848 of the Civil Code of Québec, CQLR, c. C-1991 [CCQ]; (2) section 9 of the CLPA constitutes an estoppel, as the alleged failures by the DVA cannot be “an event already compensated”; and (3) the action is statute-barred because, under article 2925 of the CCQ, which applies through section 32 of the CLPA, the applicable limitation period is three (3) years.

[21]           The Court is of the opinion that the principle of res judicata disposes of the entire issue and that there is therefore no need to rule on the two (2) subsequent grounds raised by the respondent.

[22]           It is well-established that an action may be ordered struck, in whole or in part, on the grounds that it reveals no reasonable cause of action within the meaning of Rule 221(1)(a) if, assuming that the facts set out in the statement are true, the Court is satisfied that it is plain and obvious that the action commenced has no reasonable chance of success (Hunt v Carey Canada Inc, [1990] 2 S.C.R. 959, at page 979; R v Imperial Tobacco Canada Ltd., 2011 SCC 42, at paras 17, 21–22; Arial 2017, at para 5).

[23]           The principle of res judicata is set out in the first paragraph of article 2848 of the CCQ (Book Seven, Evidence), which reads as follows:

[24]           In Roberge v Bolduc, [1991] 1 S.C.R. 374 [Roberge], the Supreme Court of Canada interpreted the scope of the principal of res judicata. For there to be res judicata, two (2) types of conditions are needed: first, conditions pertaining to the judgment and, second, conditions pertaining to the action. As for the judgment, “the court must have jurisdiction over the matter, the judgment must be definitive, and it must have been rendered in a contentious matter” (Roberge, at page 404). As for the action, there must be three identities, i.e. “the identity of parties, object and cause” (Roberge, at page 409).

[25]           When all these conditions are met, res judicata is an “absolute” presumption under article 2848 of the CCQ. Unlike the doctrine of issue estoppel recognized under Common Law, the Court can only exercise its discretion by refusing to apply the principle of res judicata, as that principle is codified under Quebec law (Timm v Canada, 2014 FCA 8, at paras 25–27).

[26]           On reviewing the applicants’ statement in this case and the one struck in docket T-1505-15, the Court feels that it is “plain and obvious”? that this action by the applicants has no reasonable chance of success due to the application of the principle of res judicata.

[27]           First the conditions pertaining to the judgment as defined in Roberge are met. The Federal Court is a court that has jurisdiction to hear an action for damages against the Crown. By allowing the respondent’s motion to strike the applicant’s action in Arial 2017, Leblanc J. made a definitive decision in a contentious matter. That decision cannot be appealed by the applicants.

[28]           As for the conditions pertaining to the action, the Court is of the opinion that there is identity of parties, object, and cause.

[29]           In Roberge, the Supreme Court of Canada defined identity of parties as the same parties acting in the same qualities (Roberge, at page 409). In this case, the applicants are again applicants and are acting in the same qualities as in their previous action in Arial 2017. Although the VRAB is no longer named as a respondent in this case, the respondent is still being pursued for the acts and omissions of the DVA. There is therefore identity of parties in the actions brought in dockets T‑1505-15 and T-1004-17.

[30]           Regarding identity of object, this is defined as the immediate legal benefit sought, the right whose implementation is desired, the remedy or the purpose sought (Roberge, at pages 413–414). The respondent claimed that, in both cases, it is an action for pecuniary, moral, punitive, and exemplary damages arising from the civil liability of the Crown. The applicants argue that they are no longer seeking compensation for “the loss” and that their action is now based on subsection 24(2) of the Canadian Charter, the purpose of which, according to the applicants, differs from that of the PA.

[31]           In the action commenced in 2015, Mr. Arial was seeking pecuniary damages of $345,117.56, non-pecuniary damages for injury to honour and human dignity and for the loss of choices, and punitive damages. The amount for the last two (2) heads of damages was left to the discretion of the Court. Ms. Arial was seeking pecuniary damages of $47,015.83, non-pecuniary damages for injury to honour and human dignity and for added responsibilities, and punitive damages. Like her spouse, she left it to the Court to set the amount for those damages. Finally, Sonia Aria was seeking $410,084.33 as pecuniary damages for the 6,000 hours she spent defending the case, Court administrative costs, medical costs, lost wages, leave illness for the case. She was also seeking non-pecuniary damages for moral prejudice, stress and injury to honour and human dignity, and punitive damages. In both cases, the amounts sought were left to the discretion of the Court.

[32]           In this case, Mr. and Ms. Arial are no longer seeking pecuniary damages. However, they are still seeking punitive and exemplary damages. The prejudices alleged by Mr. Arial are the infringement of a fundamental right protected by the Canadian Charter and the Quebec Charter, frustration, discomfort, worry, psychological distress, loss of independence, and loss of choice. Ms. Arial alleges injury to human dignity, integrity and honour, added responsibilities, exhaustion, a sense of powerlessness regarding the illness, and psychological stress. In both cases, the amounts are quantified as follows: [translation] “$1,750/month – amount updated in 2017” without any further clarification. They are also seeking punitive damages in the amount of [translation] “$600/month – amount updated in 2017”. The damages sought by Sonia Arial are exactly the same as in the case in 2015, with the exception of an amount of more than $10,000.00 for lost wages. She is also seeking an amount of $50,000 per year as punitive damages, alleging abuse of rights or authority.

[33]           Although Mr. and Ms. Arial are no longer seeking pecuniary damages in this case, that nuance is not enough by itself to distinguish between the purposes of the two (2) actions. In both cases, the applicants are seeking compensation for prejudice arising from the same allegations, that they were unfairly deprived of their right to the full retroactivity of the amounts sought as pensions or other allowances. It is recognized in jurisprudence that it is not necessary for the two (2) actions to seek precisely the same order, as long as the object of the second action is implicitly included in the object of the first (Roberge, at page 414).

[34]           Moreover, the Court notes that, in ruling that the applicants’ action in Arial 2017 was contrary to section 9 of the CLPA, LeBlanc J. noted that the applicants were seeking damages in an amount left to the Court’s discretion for injury to honour and human dignity in both cases, and for [translation] “loss of choice” in the case of Mr. Arial and “added responsibilities” in the case of Ms. Arial. He noted that the claims by Mr. and Ms. Arial were both consecutive to the fact that, were it not for the alleged failures of the VRAB and DVA, the compensation retroactive to March 1996 would have been paid to them under the PA. he also noted the consistency between the event for which compensation was paid to Mr. and Ms. Arial under the PA and the one on which their civil action was based, [translation] “a loss or damages providing entitlement to a pension or allowance from the consolidated revenue fund — in this case the losses or damages suffered by Mr. Arial during his military service — which pension or allowance provides for payment of an additional allowance when the processing of a pension application is affected by administrative delays or difficulties beyond the control of the pension applicant”. He then noted that [translation] “the applicants were ultimately awarded the right to payment of the maximum compensation (Arial FCA, at para 35)”.

[35]           Finally, identity of cause is defined as the legal characterization of a set of facts (Roberge, at page 416). In both cases, the actions were based on the civil liability of the Crown under the CLPA, i.e. the wrongs and violations committed by DVA officers. According to the applicants, those officers allegedly failed in their duty to provide aid and assistance to Mr. Arial, in light of his age, his precarious health, and his education. That failure to provide aid and assistance allegedly resulted in delays in the processing of applications for pensions and other allowances, justifying the awarding of damages in particular.

[36]           The applicants distinguish between the two (2) actions by adding sections 7 and 15 and subsection 24(1) of the Canadian Charter and subsection 49(1) of the Quebec Charter. They also refer to breaches of procedural fairness and natural justice. However, the Court feels that the distinctions made by the applicants are not enough to conclude that there is no identity of cause. First, the facts and allegations that underlie the action are the same as in the previous action. Second, the applicants do not show how the rules of procedural fairness and natural justice were not respected. The only allegations found in the statement in that regarding are related to [translation] “the Minister’s decisions” regarding the pension and allowance applications filed by the applicants as part of the administrative process. However, the applicants had to raise those allegations in the numerous applications for judicial review filed with this Court. Finally, the Court notes that the provisions were raised by the applicants in their reply record in Arial 2017 and that LeBlanc J. ruled on the application of subsection 24(1) of the Canadian Charter. The applicants had a duty to put forth all their best arguments in the first proceeding and cannot put forth arguments after the judgment that should have been put forth previously (Werbin v Werbin, 2010 QCCA 594 (QL), at para 8; see also Roberge, at page 402, on the definitive nature of the judgment).

[37]           In short, the applicants’ actions are based on the same facts that they allege resulted in their right to compensation. Consequently, the Court is of the opinion that there is also identity of cause between the actions brought in dockets T-1505-15 and T-1004-17.

[38]           In light of these three identities, the Court has no choice but to find that the principle of res judicata applies in this case.

IV.              Conclusion

[39]           Satisfied that res judicata applies in the action brought by the applicants, the Court finds that it is plain and obvious that the applicants’ action has no reasonable chance of success. For these reasons, the respondent’s motion is allowed with costs and the applicants’ statement is struck without possibility of amendment, as an amendment cannot resolve the defect.

ORDER in T-1004-17

THE COURT ORDERS that:

1.      The applicants’ entire statement is struck without possibility of amendment.

2.      The style of cause is amended to designate the respondent as “Her Majesty the Queen in Right of Canada”.

3.      With costs.

“Sylvie E. Roussel”

FEDERAL COURT

SOLICITORS OF RECORD

WRITTEN MOTION CONSIDERED AT OTTAWA, ONTARIO UNDER RULE 369 OF THE FEDERAL COURT RULES.

ORAL AND/OR WRITTEN REPRESENTATIONS BY:

SOLICITORS OF RECORD: