Young v. McCreary et al.; The Attorney General of Canada et al., Third Parties [Indexed as: Young v. McCreary]

53 O.R. (3d) 257

[2001] O.J. No. 1315

Docket No. C34961

Court of Appeal for Ontario

Abella, Charron and Sharpe JJ.A.

April 11, 2001

Crown--Immunity--Plaintiff brought action for damages for defamation and malicious prosecution against two fellow employees of Correctional Services Canada after they filed complaints of harassment against her--Defendants brought motion to dismiss action under rule 21.01(1)(a)--Motions judge dismissed action on ground that plaintiff was barred by s. 9 of Crown Liability and Proceedings Act from proceeding with action as she had received pension in respect of her damages from Consolidated Revenue Fund--Record before motions judge did not provide sufficient basis for concluding that defendants were acting within scope of their employment when they filed complaints--Motions judge erred in law in holding that s. 9 applies to Crown servants without regard to capacity in which they acted--Crown Liability and Proceedings Act, R.S.C. 1985, c. C-50, s. 9--Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 21.01(1)(a).

While employed by Correctional Services Canada, the defendants filed complaints of harassment against the plaintiff. Those complaints were dismissed. The plaintiff subsequently brought an action for damages for defamation and malicious prosecution. The defendants brought a motion to have the action dismissed on the ground that the plaintiff had received a pension or compensation with respect to her damages from the Consolidated Revenue Fund and was therefore barred from proceeding under s. 9 of the Crown Liability and Proceedings Act. While the motion was brought under rule 21.01(1)(a) of the Rules of Civil Procedure for the determination of a point of law, the defendants led affidavit evidence that the plaintiff had retired for medical reasons and had been granted disability pensions under the Canada Pension Plan, R.S.C. 1985, c. C-8 and the Public Service Superannuation Act, R.S.C. 1985, c. P-36. The motions judge granted the motion to dismiss the action, holding that the defendants were acting within the scope of their employment when they filed the complaints and that s. 9 of the Act applied even if the defendants were acting with malice outside the scope of their employment. The plaintiff appealed.

Held, the appeal should be allowed.

There was not a sufficient basis on the record before the motions judge to conclude that the defendants were acting within the scope of their employment when they filed the complaints. In her statement of claim, the plaintiff had alleged that the defendants had acted maliciously and with intent to injure her when they filed the complaints. On a Rule 21 motion, the truth of those allegations had to be assumed. Further, the motions judge's conclusion that s. 9 of the Act applies to Crown servants without regard to any consideration of the capacity in which they acted was wrong in law. Accordingly, the motions judge erred in concluding that the defendants had demonstrated that they were entitled to have the action dismissed on the basis of s. 9.

APPEAL from an order dismissing an action.

Cases referred to Canada (Conseil des ports nationaux) v. Langelier (1968), 1968 51 (SCC), [1969] S.C.R. 60, 2 D.L.R. (3d) 81; MacLean v. Ontario (Liquor Licence Board) (1975), 1975 513 (ON SC), 9 O.R. (2d) 597, 61 D.L.R. (3d) 237 (Div. Ct.); Nireaha Tamaki v. Baker, [1901] A.C. 561, 70 L.J.P.C. 66, 84 L.T. 633, 17 T.L.R. 496 (P.C.); Rattenbury v. British Columbia (Land Settlement Board) (1928), 1928 42 (SCC), [1929] S.C.R. 52, [1929] 1 D.L.R. 242 [Leave to appeal to P.C. refused [1929] W.N. 211]; Sarvanis v. Canada (2000), 2000 14757 (FCA), 184 D.L.R. (4th) 124, 252 N.R. 131, 179 F.T.R. 153n (C.A.) [Leave to appeal to S.C.C. allowed (2000), 263 N.R. 398n, [2000] S.C.C.A. No. 114] Statutes referred to Canada Pension Plan, R.S.C. 1985, c. C-8 Crown Liability and Proceedings Act (as renamed by S.C. 1990, c. 8, s. 21), R.S.C. 1985, c. C-50, ss. 9, 22(2) Public Service Superannuation Act, R.S.C. 1985, c. P-36. Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 20, 21, 21.01(1)(a), (2)(a) Authorities referred to Hogg, P.W., and P.J. Monahan, Liability of the Crown, 3d ed. (Toronto: Carswell, 2000)

Kenneth J.M. Coull, for applicant. Bryce V. Geoffrey, for respondents McCreary and Watt. Robert MacKinnon, for third parties.

The judgment of the court was delivered by

[1] SHARPE J.A.--This appeal raises the issue of the extent to which servants of the Crown are immunized from civil liability by the Crown Liability and Proceedings Act, R.S.C. 1985, c. C-50, s. 9.

Facts

[2] In this action, the appellant claims general, special, exemplary and punitive damages against Anne McCreary and Donna Watt ("the respondents") for defamation and malicious prosecution. The statement of claim alleges that the appellant was employed by Correctional Services Canada and that she had supervisory authority over the respondents. The respondents made complaints of harassment against the appellant. Those complaints were dismissed. The appellant alleges in the statement of claim that the respondents made these complaints "maliciously and with intent to harm" her and that the complaints were defamatory of the appellant. It is also alleged that by making the complaints, the respondents are liable for malicious prosecution of the appellant.

[3] In their statement of defence, the respondents say that their complaints were filed in accordance with the established policies of Corrections Canada, and they deny the allegation that they acted maliciously or with intent to harm the appellant. They assert that their allegations were not defamatory of the appellant but rather that they were true. They also rely on the defences of privilege and qualified privilege.

[4] After this matter had been set down for trial, the respondents brought a motion to amend the statement of defence to plead the Crown Liability and Proceedings Act, s. 9, which provides as follows:

9. No proceedings lie against the Crown or a servant of the Crown in respect of a claim if a pension or compensation has been paid or is payable out of the Consolidated Revenue Fund or out of any funds administered by an agency of the Crown in respect of the death, injury, damage or loss in respect of which the claim is made.

[5] At the same time, the respondents brought a motion to have the action dismissed on the ground that the appellant had received a pension or compensation with respect to her damages within the meaning of s. 9. The Notice of Motion indicated that the motion was being brought pursuant to rule 21.01(1)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, for the determination of a point of law. However, the respondents led evidence in support of the motion. Brief affidavits sworn by the respondent Watt and by a lawyer from the Department of Justice attached extracts from the appellant's examination for discovery in which she stated that she retired for medical reasons after the incidents complained of, and that she had been granted disability pensions under both the Canada Pension Plan, R.S.C. 1985, c. C-8 and the Public Service Superannuation Act, R.S.C. 1985, c. P-36.

[6] The motions court judge allowed the amendment to the statement of defence and also granted the motion to dismiss the appellant's claim on the ground that the appellant had accepted moneys from the Consolidated Revenue Fund with the result that [the] Crown Liability and Proceedings Act, s. 9, barred her from proceeding. The motions court judge's endorsement gave the following reasons for dismissing the claim:

The Plaintiff responds by alleging that the wrongful conduct complained of was not within the scope of employment and therefore s. 9 should not apply, I reject this submission: firstly because this is far from the case where an employee takes the employer's car without permission, or a doorman beats a patron--it is one where the alleged wrongdoers file a complaint of harassment as provided in policies and directives of their employer; secondly, even if the employees were acting with malice outside the scope of their employment --s. 9 only addresses the fact of the remedy (collecting a pension or compensation) and is silent as to how the injury might have occurred. Ordinary rules of statutory interpretation prevent one from reading in something that is simply not there.

Issues

[7] The appellant raises two issues on appeal:

(1) Have the respondents established that they are entitled to the benefit of the protection of the Crown Liability and Proceedings Act, s. 9?

(2) Do disability payments from the Canada Pension Plan and the Public Service Superannuation Act preclude recovery pursuant to s. 9 of the Crown Liability and Proceedings Act?

Analysis

Issue 1: Have the respondents established that they are entitled to the benefit of the protection of the [Crown Liability and Proceedings Act, s. 9](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-c-50/latest/rsc-1985-c-c-50.html)?

[8] There appears to have been an unfortunate element of uncertainty as to the precise procedural avenue being pursued by the respondents in seeking to have the action dismissed. The respondents brought a motion pursuant to rule 21.01(1)(a) to determine, as a point of law, the applicability of the Crown Liability and Proceedings Act, s. 9. However, that issue could not be resolved without evidence. It is not clear that leave or consent to introduce evidence was obtained pursuant to rule 21.01(2)(a). Before us, counsel indicated that the matter proceeded as both a Rule 21 motion and as a motion for summary judgment pursuant to Rule 20. In any event, the factual basis for the motion was limited to the pleadings and the short affidavits establishing that the appellant was in receipt of the two disability pensions. Even assuming that the matter could be treated as a Rule 20 motion, no evidence was led by the respondents as the moving parties, nor by the appellant, with respect to the issues of whether the respondents were acting with or without malice or within or without the scope of their employment as Crown servants.

[9] In these circumstances, I cannot agree with the conclusion reached by the motions court judge that there was a sufficient basis on the record to conclude that the respondents were acting within the scope of their employment when they filed the complaints that form the basis of the appellants' action. In her statement of claim, the appellant alleged that the respondents were acting maliciously and with intent to injure her when filing the complaints. On a Rule 21 motion, the truth of these allegations must be assumed. Even if the matter was, in fact, treated as a Rule 20 motion, in the absence of any affidavit evidence establishing that there was no genuine issue for trial on those allegations, there was an insufficient evidential foundation to support the motions court judge's finding that the respondents had done nothing more than file a complaint of harassment as provided in the policies and directives of their employer.

[10] Nor can I agree with the alternative basis offered by the motions court judge for dismissing the action, namely that s. 9 of the Crown Liability and Proceedings Act applies regardless of whether the respondents were acting with malice and outside the scope of their employment. While on its face, s. 9 applies to Crown servants without exception or qualification as to the capacity in which they act, it must be given a purposive interpretation that is consistent with general principles relating to the statutes that immunize or limit the liability of the Crown or Crown servants.

[11] I cannot accept the proposition that s. 9 should be applied to shield Crown servants from liability without regard to the capacity in which they were acting at the time of the alleged wrong. If an individual who happens to be a servant of the Crown is involved in a motor vehicle accident while on a Sunday drive, surely that individual's weekday status as a Crown servant is irrelevant to liability for damages caused in his or her personal capacity. Similarly, it is my view that if the appellant can establish that the respondents were acting maliciously or outside the scope of the Corrections Canada procedure when bringing their complaints against her, she would not be barred by s. 9 from proceeding with her claim. It would be inconsistent with established principles of interpretation to hold that s. 9 applies to all actions against Crown servants without regard to the capacity in which they were acting at the time of the alleged wrong.

[12] In Canada (Conseil des ports nationaux) v. Langelier, 1968 51 (SCC), [1969] S.C.R. 60 at p. 74, 2 D.L.R. (3d) 81, Martland J. referred to the well-recognized principle, laid down by the Privy Council in Nireaha Tamaki v. Baker, [1901] A.C. 561, 70 L.J.P.C. 66 and by the Supreme Court of Canada in Rattenbury v. British Columbia (Land Settlement Board), 1928 42 (SCC), [1929] S.C.R. 52, [1929] 1 D.L.R. 242 that despite Crown immunity "there was always recourse in the common law courts in respect of acts done, without legal justification, by an agent of the Crown." While there appears to be no case dealing with this issue under s. 9, an analogy may be drawn to the interpretation accorded provisions similar to s. 22(2) of the Crown Liability and Proceedings Act, providing that no relief or order may be granted against a servant of the Crown if it cannot be made against the Crown itself. The protective statutory bar against injunctive relief does not apply where the Crown servant abuses his or her apparent powers or acts without authority: see MacLean v. Ontario (Liquor Licence Board) (1975), 1975 513 (ON SC), 9 O.R. (2d) 597, 61 D.L.R. (3d) 237 (Div. Ct.); P.W. Hogg and P.J. Monahan, Liability of the Crown, 3d ed. (Toronto: Carswell, 2000) at pp. 32-34.

[13] I do not agree with the submission accepted by the motions court judge and pressed before us that s. 9 only addresses the matter of remedy. The effect of s. 9 is to shield the Crown servant from liability, and it follows that it can only be applied with reference to both the nature of the actions alleged against the Crown servant and the capacity in which the Crown servant was acting.

[14] In my view, the proposition that s. 9 applies to Crown servants without regard to any consideration of the capacity in which they acted is wrong in law. Accordingly, it is my view that the motions court judge erred in concluding that the respondents had demonstrated that they were entitled to have the action dismissed on the basis of s. 9. On the record before this court, it is neither necessary nor appropriate to attempt a precise or comprehensive statement of the test that should be applied to determine the application of s. 9.

Issue 2: Do disability payments from the [Canada Pension Plan](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-c-8/latest/rsc-1985-c-c-8.html) and the [Public Service Superannuation Act](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-p-36/latest/rsc-1985-c-p-36.html) preclude recovery pursuant to [s. 9](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-c-50/latest/rsc-1985-c-c-50.html) of the [Crown Liability and Proceedings Act](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-c-50/latest/rsc-1985-c-c-50.html)?

[15] We were advised that the respondents' motion for judgment was prompted by the decision of the Federal Court of Appeal in Sarvanis v. Canada (2000), 2000 14757 (FCA), 184 D.L.R. (4th) 124, 252 N.R. 131, holding that receipt of disability benefits under the Canada Pension Plan was sufficient to preclude a claim pursuant to s. 9 of the Crown Liability and Proceedings Act. The Supreme Court of Canada has given leave to appeal from that decision ([2000] S.C.C.A. No. 114) and the question of what pensions and what circumstances trigger the protective provisions of s. 9 is to be considered by that court. My determination of the first issue is sufficient to dispose of this appeal. In these circumstances, and in view of the very limited nature of the factual record, it is neither necessary nor desirable for me to express any view as to the second ground of appeal.

Conclusion

[16] For these reasons I would allow the appeal and set aside the order of the motions court judge dismissing the action. The appellant is entitled to her costs of the appeal and of the proceedings before the motions court judge.

Appeal allowed.