Making a mockery

Ungracious Crown conduct. Plus product liability for consultants, judges making political donations, and forged signatures.

Hearsay

Last week I asked what you thought of the Ohio Supreme Court’s boneless chicken case. Here are the results:

🟨⬜️⬜️⬜️ Chicken clearly has bones (26%)

🟩🟩🟩⬜️ Boneless means boneless (74%)

The split result really drives home this point from the dissent:

[T]he majority declares as a matter of law that no reasonable person could consider the facts of this case and reach a conclusion [that boneless means boneless]. This is, of course, patently untrue given that I and two other justices of this court dissent [backed by 74% of Hearsay readers].

I’m with the majority in camp unreasonable. But I did unfortunately learn that I live in a divided household. My wife likes her boneless wings with a side of caveat emptor.

— Dylan Gibbs

with Alexandra Son

TODAY'S DOCKET

  • The Supreme Court’s take on broken promises

  • Product liability for consultants

  • Residential school denialism?

  • A signature-forging lawyer

  • Pronoun interveners

  • Political donations

SCC

Supreme Court takes a dim view of unfulfilled treaty obligations

Indigenous settlements along a body of water, with mountains in the bakcground

Ontario v. Restoule, 2024 SCC 27

Last week’s Supreme Court decision is long. You can chalk a fair bit of the length up to Justice Jamal’s writing style, but the decision also covers a lot of ground. It’s a comprehensive look at treaty-based relationships between the Crown and Indigenous peoples.

What happened? The Anishinaabe of the upper Great Lakes traded their land for a perpetual annuity, paid from the land’s resource revenues. The annuity was capped at $4 per person, unless “Her Majesty [was] graciously pleased to order” a higher amount.

The issue is that Her Majesty never felt gracious. The annuity payments started around $1.70 per person in 1850, increased to $4 per person in 1875, and haven’t budged since. So the Anishinaabe sued Ontario and Canada, asking for a fair share of the Crown’s resource revenues.

Schitts Creek Hello GIF by CBC

By the time the case made it to the SCC, everyone agreed the Crown had to act honourably by at least considering a raise. But the impact of the $4 cap was up for interpretation.

The lower courts avoided the cap by carving the annuity into two parts—a capped payment to individuals and an uncapped payment to the collective Anishinaabe. That netted the Anishinaabe their fair share. But it required a creative reading of the treaties, which don’t actually mention two separate payments:

[If the ceded territory] shall at any future period produce an amount which will enable the Government of this Province, without incurring loss, to increase the annuity …, then [the annuity] shall be augmented from time to time, provided that the amount paid to each individual shall not exceed [$4 per year], or such further sum as Her Majesty may be graciously pleased to order; and [if the population of Indigenous beneficiaries drops below 827], the annuity shall be diminished in proportion to their actual numbers.

The SCC wasn’t up for the same interpretive gymnastics. Justice Jamal wrote for the unanimous Court, saying the cap is exactly what it sounds like—a cap. But it is a soft cap. The Crown needs to consider upping the annuity whenever the land makes enough profit to justify a raise.

The Supreme Court’s interpretation meant that the Crown technically won the appeal. But it wasn’t much of a victory. The Court said the Crown should have acted sooner, increasing the annuity to match what it can afford:

For almost 150 years, the annuities have been frozen at a shocking $4 per person … in what can only be described as a mockery of the Crown’s treaty promise to the Anishinaabe…

Now the Crown needs to make the increase retroactively. The Court even ordered Ontario to pay solicitor-client costs despite the province winning its appeal.

Precedential value

Justice Jamal applied the Court’s settled approach to treaty interpretation to resolve the appeal’s main issue—so there’s no new law there. But the Court also addressed a few other issues with broader reach.

  • The standard of review for treaty interpretation is correctness. Since treaties have constitutional status and bind future generations, appellate courts won’t give treaty interpretation the same deference as run-of-the-mill contract interpretation.

  • Treaties don’t create fiduciary duties. So the Crown needs to consider increasing the annuity, but it doesn’t need to put the Anishinaabe’s interests above all else.

  • And Ontario’s limitations legislation doesn’t apply to treaty claims. That one might strike you as odd—the Court said a treaty claim was barred by a limitation period in Shot Both Sides just a few months ago. But Shot Both Sides dealt with a different statute, which led to a different result.

Some provincial limitations statutes have … residual provisions or basket clauses (see e.g., [the Alberta statute considered in Shot Both Sides]). [But Ontario’s] 1990 Limitations Act “applies only to a closed list of enumerated causes of action”.

What now? The Court wouldn’t order the Crown to pay damages. At least, not yet. The Court made it clear that it can award damages. But it gave the parties space to negotiate as a first resort.

Not too much space though.

For well over a century, the Crown has shown itself to be a patently unreliable and untrustworthy treaty partner... It has lost the moral authority to simply say “trust us”.

The Court put a six-month deadline on negotiations to force the Crown into action.

Some of the plaintiffs already settled for a whopping $10 billion. So, while those plaintiffs fight about their legal bill, Canada and Ontario just need to resolve the rest of the claim. And if they can’t strike a deal, the governments need to adjust the annuity unilaterally and wait for the courts to weigh in.

If the parties are unable to arrive at a negotiated settlement, then the Crown must, within six months of the release of these reasons, exercise its discretion … and set an amount to compensate the Superior plaintiffs for past breaches. The amount, and the process through which it is arrived at, will be subject to review by the courts.

HEARSAY ROUNDUP

Canadiana

💊 Consultants beware. The BC Court of Appeal said McKinsey may be liable for helping opioid companies with their marketing. McKinsey argued that consultants are never responsible for their clients’ dangerous products. But the Court said the issue is murky enough to send to trial.

[T]he proximity of [McKinsey’s] relationship to end users could depend on the evidence at trial regarding how closely, or not, [McKinsey] worked with the manufacturer/distributor clients, and the degree to which it coached those clients in ways to increase the harmful spread of opioid use; including its knowledge or constructive knowledge that the techniques it was coaching the clients to use included misrepresentations that could lead to personal harm.

[I]t is not plain and obvious that [McKinsey’s role as] a consultant … distances it from liability.

McKinsey v. BC, 2024 BCCA 277 at paras 52-59

🏳️‍⚧️ The Saskatchewan Court of Appeal bounced a parental rights group, denying Our Duty Canada intervener status in the province’s contentious gender identity appeal. The issue was that the group didn’t have anything to say about Saskatchewan’s use of the notwithstanding clause—which is the appeal’s focus. The Court let 11 other interveners participate, including Alberta, New Brunswick, and several advocacy groups.

🧑‍⚖️ A trial judge’s reference to “potential” Indigenous remains wasn’t biased. The comment drew outrage from the gallery during a sentencing hearing. And it led to an appeal alleging the trial judge engaged in residential school denialism. Here’s the exchange:

DEFENCE COUNSEL: … Ms. Bibbings has volunteered [to plant] 215 healing forests to honour the Kamloops Residential School children whose bodies have been unearthed –

THE COURT: Well, I don't think there's –

DEFENCE COUNSEL: -- or remains.

THE COURT: -- there's no bodies that have been unearthed.

DEFENCE COUNSEL: Remains. Remains have been unearthed.

THE COURT: They have been?

DEFENCE COUNSEL: Oh, sorry, you -- I stand corrected. Who have been identified through ground penetrating radar.

THE COURT: Potential.

The BC Court of Appeal said the trial judge was simply correcting defence counsel’s inaccurate submissions about unearthed remains.

[“Potential”] is the very same word Indigenous communities and others have used to describe the results of tests using ground penetrating radar in and around former residential school sites.

[I]t is simply not possible to objectively interpret the judge’s comment about “potential” remains at unmarked burial sites as indicative of apparent or actual intolerance, denial or bias.

R. v. Dick, 2024 BCCA 272 at paras 50–53

🧑‍⚖️ The Canadian Judicial Council sanctioned Justice Diana Piccoli for her political donations. Justice Piccoli donated around $900 to the federal Liberals between 2019 and 2021. After the media reported on the issue, she self-reported to the CJC. The panel reviewing her conduct wasn’t prepared to simply dismiss the complaint, but it settled on an expression of concern (the lowest available sanction).

Although the amount might not seem large, a political donation by a judge is not “trivial” because it has the potential to undermine public confidence in the independence of the judiciary from the other branches of government.

[A]n expression of concern … recognizes the serious nature of the conduct.

Review Panel Decision at paras 29-33

SUITS IN THE NEWS

THINGS NOT TO DO

Don’t forge your client’s signature to speed up a deal. The Law Society of Alberta said a 30-day suspension would be appropriate for a lawyer who noticed a few missing signatures and took matters into his own hands. But the LSA reduced the punishment to a single-day suspension, since the lawyer stopped practicing for three years after the incident.

The Committee is mindful of the significance of Mr. McHenry’s conduct and the importance of preserving public confidence in the profession. There are instances where adding a signature to a document, well intended or not, may lead to a more severe sanction or even disbarment.

Taking into account the facts admitted in this matter, the Committee is satisfied by a one (1) day suspension, in recognition of 30 days of time already spent away from practice.

LSA v. McHenry, 2024 ABLS 15 at paras 78-79
Dylan Gibbs

That’s all for today. Govern yourself accordingly.

If someone sent you this email, subscribe here.

SHARE HEARSAY

Don’t keep us a secret. Get your friends to sign up and you’ll be rewarded. You can find your custom referral link in the email version of Hearsay.

Referral rewards include coffee, sticker pack, t-shirt, book, crewneck, and a $500 prepaid credit card

Reply

or to participate.