Falkiner et al. v. Director, Income Maintenance Branch, Ministry of Community and Social Services et al. [Indexed as: Falkiner v. Ontario (Ministry of Community and Social Services)]

49 O.R. (3d) 564

[2000] O.J. No. 3492

Docket Nos. M26208 (M26092)

Court of Appeal for Ontario

Laskin, Goudge and Feldman JJ.A.

September 22, 2000

Civil procedure -- Stay pending appeal -- Test for stay -- To be entitled to stay, party must show irreparable harm if stay is not granted.

After the Divisional Court had granted F's application and ruled that the definition of "spouse" in s. 1(1)(d) of Reg. 366, R.R.O. 1990 under the Family Benefits Act, R.S.O. 1990, c. F.2 was unconstitutional, the Crown sought leave to appeal and it moved for a stay of the Divisional Court's judgment. Osborne A.C.J.O. granted the stay on conditions. In granting the stay, he found that (1) there was a serious question to be tried; (2) neither party would suffer irreparable harm if the stay was refused; and (3) the balance of convenience favoured the Crown. F moved under s. 7(5) of the Courts of Justice Act, R.S.O. 1990, c. C.43 to vacate the stay.

Held, the stay should be vacated.

The Crown failed to meet the test established in RJR- MacDonald v. Canada (Attorney General) for the granting of a stay. Once it was determined that the Crown would not suffer irreparable harm, a finding that was reasonably supported on the evidence, it was not entitled to a stay pending the appeal.

MOTION under s. 7(5) of the Courts of Justice Act, R.S.O. 1990, c. C.43 to vacate a stay.

Cases referred to Metropolitan Stores (MTS) Ltd. v. Manitoba Food & Commercial Workers, Local 832, 1987 CanLII 79 (SCC), [1987] 1 S.C.R. 110, 46 Man. R. (2d) 241, 38 D.L.R. (4th) 321, 73 N.R. 341, [1987] 3 W.W.R. 1, 25 Admin. L.R. 20, 87 C.L.L.C. 14,015, 18 C.P.C. (2d) 273 (sub nom. Manitoba (Attorney General) v. Metropolitan Stores (MTS) Ltd.); RJR-MacDonald Inc. v. Canada (Attorney General), 1994 CanLII 117 (SCC), [1994] 1 S.C.R. 311, 60 Q.A.C. 241, 111 D.L.R. (4th) 385, 164 N.R. 1, 20 C.R.R. (2d) D-7, 54 C.P.R. (3d) 114 Statutes referred to Canadian Charter of Rights and Freedoms, ss. 1, 15 Courts of Justice Act, R.S.O. 1990, c. C.43, s. 7(5) Family Benefits Act, R.S.O. 1990, c. F.2 Rules and regulations referred to General Regulation, R.R.O. 1990, Reg. 366 (Family Benefits Act), s. 1(1)(d)

Janet E. Minor and Sarah T. Kraicer, for appellants. Raj Anand and M. Kate Stephenson, for respondents.

[1] BY THE COURT: -- The moving parties, the respondents on the appeal, Sandra Falkiner et al., move under s. 7(5) of the Courts of Justice Act, R.S.O. 1990, c. C.43 to vacate the stay ordered by Osborne A.C.J.O. on July 24, 2000. We will briefly set out the background to this motion. On June 28, 2000, the Divisional Court concluded that the definition of "spouse" in s. 1(1)(d) of Reg. 366, R.R.O. 1990 under the Family Benefits Act, R.S.O. 1990, c. F.2 was unconstitutional because it violated s. 15 of the Canadian Charter of Rights and Freedoms and could not be saved under s. 1. The appellants, the Director and the Attorney General of Ontario (the "Crown"), sought leave to appeal from the decision of the Divisional Court. While that leave motion was pending, Osborne A.C.J.O. stayed the Divisional Court's decision on conditions that the Ministry of Community and Social Services would not refer for prosecution any new cases of "welfare fraud" for having an undeclared spouse and would make its best efforts to ensure that pending prosecutions were adjourned or stayed by the Crown. Since the order of Osborne A.C.J.O., this court has granted leave to appeal from the Divisional Court's decision. The hearing of the appeal has been expedited and, on the consent of the parties, has been scheduled for January 31, 2001.

[2] On this motion, the moving parties make one main submission: Osborne A.C.J.O. erred in law in granting the stay because he found that the Crown would not suffer irreparable harm if a stay were refused. We agree with this submission.

[3] Osborne A.C.J.O. applied the three-part test established by the Supreme Court of Canada in Metropolitan Stores (MTS) Ltd. v. Manitoba Food & Commercial Workers, Local 832, 1987 CanLII 79 (SCC), [1987] 1 S.C.R. 110, 38 D.L.R. (4th) 321 and RJR-MacDonald v. Canada (Attorney General), 1994 CanLII 117 (SCC), [1994] 1 S.C.R. 311, 111 D.L.R. (4th) 385. The party seeking a stay -- here the Crown -- must first show that the appeal raises a "serious question to be tried"; second, that it will suffer irreparable harm if the stay is refused; and third, the balance of convenience favours a stay. The constitutionality of the definition of "spouse" in the Family Benefits Act raises a serious issue, and Osborne A.C.J.O. held that, with the conditions he imposed, the balance of convenience favoured the Crown.

[4] However, it is the second part of the three-part test that is key on this motion to vary: the issue of irreparable harm. On this issue, Osborne A.C.J.O. held, "In my opinion, irreparable harm is a generally neutral factor here. Both sides will suffer harm if I do not accede to their position on the stay issue. Neither side will suffer irreparable harm."

[5] Ms. Minor, with her usual candour, acknowledges that if the Crown cannot show irreparable harm, it is not entitled to a stay. She submits, however, that the Crown will suffer irreparable harm if the stay is not granted. She contends that the government cannot implement the Divisional Court's decision for at least four to six months. Requiring immediate implementation, she argues, would cause confusion and uncertainty in the delivery of benefits both under the Family Benefits Act and under related statutory schemes.

[6] We do not accept this submission. Osborne A.C.J.O.'s finding of no irreparable harm is a finding of fact that, in our view, was reasonably supported by the evidence before him. We particularly take into account that at most 500 sole support parents are under the Family Benefits Act regime and that, as Osborne A.C.J.O. pointed out, the government promptly put in place temporary measures to implement the Divisional Court's decision after it was released (see the fact sheet at p. 124 of the motion record). In short, we see no grounds to interfere with Osborne A.C.J.O.'s finding of no irreparable harm.

[7] The Crown has therefore failed to meet the test in RJR- MacDonald, supra, and is not entitled to a stay. The motion to vary is granted and the stay ordered by Osborne A.C.J.O. is set aside. The moving parties are entitled to their costs of this motion.

Order accordingly.