Crocker v. Ontario (Community and Social Services), 2012 HRTO 736

HUMAN RIGHTS TRIBUNAL OF ONTARIO

B E T W E E N:

Doral Crocker and Lorena Lemoine

Complainants

-and-

Ontario Human Rights Commission

Commission

-and-

Her Majesty the Queen in Right of Ontario as Represented by the Minister of Community and Social Services

Respondent

LEAD CASE DECISION

Adjudicator: David A. Wright

Date: April 12, 2012

Citation: 2012 HRTO 736

Indexed as: Crocker v. Ontario (Community and Social Services)

______________________________________________________________________ APPEARANCES

Doral Crocker and ) Lesli Bisgould, Cindy Wilkey and Lorena Lemoine, Complainants ) Deirdre McDade, Counsel

Ontario Human Rights Commission ) Cathy Pike, Counsel

Her Majesty the Queen in Right ) of Ontario as Represented by the ) Courtney Harris and Minister of Community and ) Robert E. Charney, Counsel Social Services, Respondent )

INTRODUCTION

1This Decision is about the appropriate remedial order in two cases of discrimination in the Special Diet Allowance (“SDA”) under the Ontario Disability Support Plan. There is no dispute that applying the principles in the Tribunal’s decision in Ball v. Ontario (Community and Social Services), 2010 HRTO 360, the respondent owes financial payments to the complainants as a result of the discriminatory provision of benefits for special diet for hypertension and hypercholesterolemia. The issue is whether the respondent should be restricted from applying these amounts towards overpayments owed by the complainants to the respondent Ministry, which were incurred before the period for which the benefits were to be paid. The respondent says that it should be entitled, pursuant to its discretion under s. 51(1)(b) of O. Reg. 222/98 under the Ontario Disability Support Program Act, 1997, S.O. 1997, c. 25 (“ODSPA”), to fully apply the payments to a reduction of the complainants’ debts to it. The complainants argue that the Tribunal’s remedial order should not permit the respondent to do so.

OVERPAYMENTS IN ONTARIO’S SOCIAL ASSISTANCE SYSTEM

2Under s. 14(1) of the ODSPA, an overpayment is any payment in excess of the amount to which a recipient was entitled. An overpayment is a debt to the Crown (s. 14(2.1)) and may be recovered in one of three ways. First, the amount may be deducted from the recipient’s income support, but the amount deducted may not exceed a set amount unless the recipient agrees (s. 15). Second, the Director of ODSP may give notice in writing of a decision that an overpayment exists and, once the appeal process is complete or the time for appeal has expired, the Director’s decision may be enforced as if it were an order of the Superior Court of Justice (s. 16). Finally, the Director may recover an overpayment in a court of competent jurisdiction, whether or not notice has been provided under s. 16 (s. 17).

3Section 15 reads as follows:

15(1) The Director may recover the amount of an overpayment by deducting it from the recipient’s income support.

(2) The amount deducted under subsection (1) shall not exceed the prescribed amount unless the recipient agrees to a greater amount being deducted.

4The prescribed amounts are set out in s. 51(1) of O. Reg. 222/98:

For the purposes of subsections 15(2) and 18(3) of the Act, the prescribed amount is,

(a) 10 per cent of budgetary requirements; and

(b) 100 per cent of any arrears of income support, including arrears of income support payable under section 29.1, or any arrears of assistance under the Ontario Works Act, 1997 payable to the recipient.

5The Ministry has established various “Income Support Directives”, including directive 11.1 related to overpayments. This guides the exercise of the discretion to recover overpayments. The key sections relevant to this case are as follows:

Recovery of Overpayments on Active Cases

Overpayments on active cases are recovered by reducing monthly income support. The rate of recovery will generally be 5% of budgetary requirements but may be reduced if it will cause hardship. The rate of recovery may be increased up to 10% only where there is evidence of capacity to pay the higher amount. Recipients may voluntarily have their income support reduced by more than 10% of their budgetary requirements if they wish to pay off the overpayment faster. However, the recipient must agree to the recovery of the higher amount. Recipients may also voluntarily reduce their overpayment through the use of their own assets.

Recovery of Arrears

Effective April 1, 1999 the Director may recover up to 100% of income support owing to a recipient in order to recover an overpayment. “Income support” means assistance for basic needs, shelter, costs related to a person’s disability and other prescribed needs, and includes benefits such as the Work-Related Benefit.

ODSP staff should review the amount of the arrears that will be applied to the existing overpayment with the recipient. Discretion is to be used in the application of this policy so that it does not create undue hardship. In situations where arrears are incurred as a result of circumstances outside the control of the recipient, full arrears will be paid. For example, arrears should be paid if a recipient’s rent is increased retroactively following a Rent Review Board hearing.

6There is no question that s. 15 provides the Director with a discretion as to how much to deduct from income support when there is an overpayment: Ontario (Disability Support Program) v. Surdivall, 2012 ONSC 1851, at para. 23 (Div. Ct.). On appeals from the Director’s decision, the Social Benefits Tribunal has limited that discretion, finding that the Director could apply only a part of certain arrears amounts to an overpayment. See Decision 0910-08356, December 9, 2010, and Decision 0512-09165, June 29, 2006. In both of these cases, the express reason was to assist the recipient with a difficult financial situation.

THE COMPLAINANTS

7Ms. Crocker has borderline personality disorder and depression, which affect her memory. For the past year she has been living in social housing, but prior to that time, she lived in a trailer park and owned her own trailer. Her overpayment arose because she did not notify ODSP when her mortgage on the trailer was paid off. She states that she did not understand that her shelter allowance was based on her mortgage costs, that it would be varied when her living arrangements changed, and that ODSP therefore needed to know when the mortgage was paid off. She did not dispute the overpayment when the problem was identified.

8The respondent has been recovering Ms. Crocker’s overpayment since April 2006. It has generally been recovered at the rate of 5% per month of the basic needs and shelter portion of her budgetary requirements, with two exceptions. In the winter months when she was living in the trailer, her overpayment was suspended because of the hardship related to the heating costs of her trailer. There was also a period in 2009 when the rate was reduced to 2.9%. As of February 2012, the balance of the overpayment was $1,499.48. The parties agree that the amount owing to Ms. Crocker for SDA payments is $720.

9Ms. Lemoine has a brain injury. Her overpayment arose after she began to receive Canada Pension Plan - Disability benefits (CPP-D) in May 1994. ODSP was unaware that she was receiving these additional benefits and they were not included in the calculation of her income support until October 1999. At that time, an overpayment was assessed.

10The rate of recovery of Ms. Lemoine’s overpayment was the subject of a 2005 SBT decision. The SBT found that due to her impairments, Ms. Lemoine did not knowingly do anything wrong in accumulating the overpayment. The SBT found that a reduction of 5% of her monthly income support was an undue hardship on Ms. Lemoine and it fixed the rate at $15 per month. The Ministry has continued to recover the overpayment at that rate since that decision. As of February 2012, the balance of the overpayment was $16,427.74. The parties agree that the amount owing to Ms. Lemoine for SDA payments for is $2,244.

ANALYSIS

11The Tribunal’s authority to award remedies is set out in s. 45.2 (1) of the Human Rights Code, R.S.O. 1990, c. H.19, as amended (the “Code”), as follows:

On an application under section 34, the Tribunal may make one or more of the following orders if the Tribunal determines that a party to the application has infringed a right under Part I of another party to the application:

1. An order directing the party who infringed the right to pay monetary compensation to the party whose right was infringed for loss arising out of the infringement, including compensation for injury to dignity, feelings and self-respect.

2. An order directing the party who infringed the right to make restitution to the party whose right was infringed, other than through monetary compensation, for loss arising out of the infringement, including restitution for injury to dignity, feelings and self-respect.

3. An order directing any party to the application to do anything that, in the opinion of the Tribunal, the party ought to do to promote compliance with this Act.

12Section 45.2 applies to complaints referred to the Tribunal by the Commission prior to the section coming into effect because of s. 55(2) of the Code.

13In Ball at paras. 165-70, I stated as follows:

Against this background, I consider first the requests for retroactive and future benefits. The complainants argue that an order that benefits be paid retroactively reflects the well-established principle that monetary remedies should put the complainant in the circumstances he or she would have been in had the discrimination not occurred: Airport Taxicab (Malton) Assn. v. Piazza (1989), 1989 CanLII 4071 (ON CA), 10 C.H.R.R. D/6347 (Ont. C.A.); Smith v. Ontario (Human Rights Commission), 2005 CanLII 2811 (ON SCDC), [2005] O.J. No. 377, at para. 28 (Div. Ct.). The respondent states that it would not be appropriate for the Tribunal to make an order for retroactive or future benefits unless the amount of benefits required to achieve equality is clear and well-defined. Counsel argues that the Tribunal could make an order for a person with a condition left out of the unintended weight loss category if it found that was discriminatory, because the amount would be the same as for other conditions in that category. However, when there is no precise comparator on the schedule, as is the case here, the respondent submits that no benefits can be awarded.

The third [sic] subparagraph of s. 45.2 (1) directs the Tribunal to consider monetary compensation “for loss arising out of the infringement”. As the Supreme Court stated in Doucet-Boudreau, supra, it is essential that a remedy meaningfully vindicate the claimant’s rights. There is no question in this case that the respondent’s purpose was to provide benefits to all those who fit within the purposes of the program and no argument that it might have made the choice to have no special diet program rather than providing substantively equal benefits to those in the position of the complainants (for the opposite situation, see Schachter v. Canada, 1992 CanLII 74 (SCC), [1992] 2 S.C.R. 679). In my view, the complainants are entitled to retroactive benefits from the date that they would have been eligible for them had the program not violated the Code.

At the same time, the concerns of the respondent are not without foundation. There is no precise, easily calculable amount that the Tribunal can apply to determine what retroactive and future benefits should be. The costing of the diet is within the institutional competence and discretion of the respondent, provided it complies with the Code in doing so. Accordingly, in my view, the appropriate order is that the respondent, within 90 days following this Decision, provide the complainants with retroactive benefits and future monthly benefits that reflect the Code principles set out in this Decision. I will remain seized of their Complaints for the sole purpose of dealing whether any dispute over whether the respondent has complied with this aspect of the Order.

I turn next to the question of compensation for injury to dignity, feelings, and self-respect, also known as general damages. The parties agree that when a Code claim relates to government legislation or regulations, specific principles apply. As the Supreme Court of Canada held in Mackin v. New Brunswick (Minister of Finance), 2002 SCC 13, when a law is struck down as unconstitutional damages will only be awarded if there is conduct that is “clearly wrong, in bad faith, or an abuse of power”: see para. 79. Later paragraphs of the judgment also refer to “negligence” and “wilful blindness”: see paras. 82-83.

The Mackin approach requires an evaluation of whether, evaluated in light of the jurisprudence as it stood at the time, the government’s conduct was clearly wrong. Unless, at the time the legislation or regulations were implemented, it was or ought to have been evident that the steps taken were unconstitutional, damages should not be awarded. As the Court stated at para. 79:

Thus, the government and its representatives are required to exercise their powers in good faith and to respect the “established and indisputable” laws that define the constitutional rights of individuals. However, if they act in good faith and without abusing their power under prevailing law and only subsequently are their acts found to be unconstitutional, they will not be liable. Otherwise, the effectiveness and efficiency of government action would be excessively constrained.

In Communauté urbaine de Montréal, supra, at paras. 19-22 the Court confirmed the application of these principles to the Quebec Charter, which, like the Code, is quasi-constitutional human rights legislation. In Braithwaite, supra, at para. 88, the Divisional Court held that Mackin also applies under the Ontario Code, stating as follows:

Moreover, the Supreme Court of Canada has held that absent conduct that is clearly wrong, in bad faith or an abuse of power, it is inappropriate to award damages when legislation is subsequently found to be unconstitutional or contrary to provincial human rights legislation (Mackin v. New Brunswick (Minister of Finance), 2002 SCC 13, [2002] 1 S.C.R. 405 at paras. 78-79; Québec (Commission des droits de la personne et droits de la jeunesse) v. Communauté urbaine de Montréal, 2004 SCC 30, [2004] 1 S.C.R. 789 at para. 23).

14The Commission suggests that it was the Tribunal’s intention in Ball to award damages rather than retroactive benefits and that the use of the term “retroactive benefits” was mere shorthand for an award of damages. It states that, therefore, the ODSPA and the regulations under it do not apply and the Director cannot apply the benefits to an overpayment.

15I disagree with the Commission’s interpretation of Ball. The language in Ball making an award of retroactive and future benefits was carefully chosen, and resulted from the fact that the respondent took the position then, as it does now, that damages – either in lieu of benefits or general damages – could not be awarded as a result of Mackin and its adoption in Braithwaite. The complainants and Commission asked for retroactive benefits in their pleading, and the respondent conceded that such an award could be made consistent with the jurisprudence. Accordingly, I was careful to make an award of retroactive benefits, and to distinguish this from the claim for monetary damages, discussed at paras. 168-70. What the Tribunal’s order did was to require the respondent to re-evaluate the complainants’ requests for Special Diet Allowance under the ODSPA, based on an application of the regulations consistent with the Code principles found by the Tribunal in its Decision. The order was that the respondent pay the complainants benefits under the ODSPA. Such an order, in my view, clearly falls within the Tribunal’s broad remedial authority under subparagraphs 1 and 3 of s. 46.3 and to the extent the Commission suggests that it does not, I disagree.

16Given that the Tribunal awarded retroactive benefits, those benefits constitute a payment of “arrears” within the meaning of s. 51(1) of O. Reg. 222/98. While there is no definition of this term in the ODSPA or the regulation, the lump sum payment of benefits that should have been paid on a monthly basis had the statutory scheme not violated the Code fall within a purposive understanding of that term, in my view.

17The respondent argues that it is essential that the retroactive benefits be paid within the regulatory regime, and that to treat them any differently from other arrears under the ODSPA would be to essentially make the remedy damages. Therefore, it argues, s. 51(1)(b) of the regulation must apply, which permits a set-off. It notes in such a case the complainants are receiving a benefit from the Tribunal’s award, in the form of a reduction of their debt to the Crown. It emphasizes that they have had the benefit of the overpaid monies throughout the relevant period. It argues that the Tribunal cannot go back and give the complainants a monthly benefit to buy food during the months in issue, and so given that a lump sum is now owed, the complainants should not have a windfall while a debt to the Crown exists.

18I do not agree with the respondent that, in this regulatory regime, requiring that the monies be paid to the complainants rather than applied to their overpayment would turn the award into one of damages. The Director has discretion about whether and how much of an overpayment will be deducted from monthly benefits or from arrears. That discretion is not and cannot be exercised blindly or without consideration of the nature of the overpayment, the reason for the arrears, or the circumstances of the benefit recipient. This is clear as a result of the SBT decisions establishing limits on the exercise of the discretion and the Director’s own structuring of the discretion through the adoption of guidelines.

19As part of its broad remedial authority to make an order to pay monetary compensation and to direct a party to do anything it ought to do to promote compliance with the Code, the Tribunal can make an order that the Director exercise the discretion in s. 51(1) in a particular manner, given that the need to pay retroactive benefits arises from a finding of discrimination by the Tribunal and its remedial order. Such an order is within the structure of the regulatory regime. Just as it is appropriate for the Director and the SBT to consider the reason for arrears, whether the fact the arrears were incurred was outside the recipient’s control and hardship to the recipient when evaluating whether arrears can be applied to an overpayment, the fact that the arrears resulted from a breach of the Code is a relevant factor in whether the Director can exercise the discretion in s. 51(1)(b) to apply the payments ordered by the Tribunal to an overpayment.

20It is a basic principle of human rights remedies that the complainant should be placed in the position he or she would have been in had it not been for the discrimination. The Tribunal should structure its award of retroactive benefits in a manner consistent with this principle. The complainants should not receive, overall, less income support paid to them over the relevant period than they would have received had the special diet program not been discriminatory.

21In this case, both complainants’ overpayments pre-date the period for which they are entitled to additional special diet benefits as a result of the finding of discrimination. It is not as though they received equivalent funding, but on a different basis. Instead, the total amount of social assistance during the relevant period was less than it would have been had the special diet program not been discriminatory.

22I recognize that the regulation specifically treats arrears differently from monthly benefits in relation to overpayments and provides for a higher level of recovery of such lump sums. There are obviously important policy reasons for this. However, the regime also considers the reasons for the arrears (whether “incurred as a result of circumstances outside the control of the recipient” in the directive) and their effects. In my view, it is consistent with both human rights and social assistance principles to restrict the Director’s exercise of discretion in these circumstances, given that the arrears resulted from the respondent’s violation of the complainants’ quasi-constitutional rights. This is not providing the complainants with a “windfall” but maintaining the same division between repayment of debts and subsistence benefits paid to the complainants as would have resulted had the Code not been violated, therefore remedying discrimination to the extent possible and promoting compliance with the Code.

23This is not a final Decision in respect of either complaint, as both complainants have other conditions that may be brought forward.

ORDER

24The Tribunal makes the following order:

1. The Complaints are allowed in part.

2. The respondent shall pay Doral Crocker retroactive ODSP benefits of $720, and shall not recover any overpayment from this amount.

3. The respondent shall pay Lorena Lemoine retroactive ODSP benefits of $2,244 and shall not recover any overpayment from this amount.