Bhatnager v. Canada (Minister of Employment and Immigration), [1990] 2 S.C.R. 217
The Minister of Employment and Immigration and the Secretary of State for External Affairs Appellants
v.
Debora Bhatnager Respondent
indexed as: bhatnager v. canada (minister of employment and immigration)
File No.: 20771.
1990: March 19; 1990: June 21.
Present: Dickson C.J. and Lamer, Wilson, La Forest, L'Heureux‑Dubé, Sopinka, Gonthier, Cory and McLachlin JJ.
on appeal from the federal court of appeal
Contempt of court -- Ministers of Crown failing to comply with Federal Court's order requiring production of file within specified time ‑‑ Order served on Ministers' solicitor but not on Ministers personally -- Whether Ministers can be held liable in contempt -- Whether Ministers vicariously liable ‑‑ Federal Court Rules, C.R.C. 1978, c. 663, Rules 308, 311, 355.
The appellants were found guilty by the Federal Court of Appeal of contempt of court for disobeying an order of the Trial Division requiring them to direct their officials to produce a file by a specified date. The order was made in open court in the presence of counsel for the appellants and, a few days later, the formal order was served on the appellants' solicitor. There was no evidence, however, that the order was served personally on the Ministers, or that they were informed of its existence. In this Court, the appellants contended that since there was no evidence that they had been informed of the existence of the order, they could not be held liable in contempt for disobedience of the order. The onus of proof was on the party alleging contempt, and that onus had not been discharged. The respondent, on the other hand, contended that service of the order on the appellants' solicitor gave rise to a rebuttable presumption of actual knowledge, or at least shifted the evidentiary burden to the appellants. Since they led no evidence concerning their knowledge or lack of knowledge, the presumption created by service operated to fix them with knowledge. This appeal is to determine (1) whether acceptance of service of the order by the solicitor for the appellants is sufficient knowledge of the order on their part to found liability in contempt; and (2) whether the doctrine of vicarious liability applies in proceedings for contempt of court brought against individuals.
Held: The appeal should be allowed.
An allegation of contempt of court is criminal (or at least quasi‑criminal) in character. It is necessary, therefore, that the constituent elements of contempt be proved by the party alleging contempt beyond a reasonable doubt. In this case, the appellants cannot, at common law, be held liable in contempt since there was no evidence that they had knowledge of the order alleged to have been breached. The common law has always required personal service or actual personal knowledge of the court order as a precondition to liability in contempt.
The service of the order upon the appellants' solicitor did not fix the appellants with actual knowledge of the order. While a finding of knowledge on the part of the client may in some circumstances be inferred from the fact that the solicitor was informed, in order to infer such knowledge in the case of ministers of the Crown, who administer large departments and are involved in a multiplicity of proceedings, there must be circumstances which reveal a special reason for bringing the order to their attention. Inference of knowledge will always be available where facts capable of supporting the inference are proved.
Further, the Federal Court Rules, which permit service of an order of the court on a party's solicitor of record, cannot be interpreted so as to fix the appellants with knowledge of the order for the purposes of grounding a finding of contempt. These Rules define what is effective service for the purposes of the expeditious conduct of litigation in the Federal Court and do not purport to detract from the elements necessary to establish contempt. The principle of imputation of knowledge should not apply in the criminal or quasi‑criminal context of a contempt prosecution in the absence of express legislative language to the contrary. The Federal Court Rules do not contain such language.
Finally, the appellants cannot be held liable for contempt of court under the doctrine of vicarious liability or the sub‑doctrines of delegation and identification. First, given the premise that liability in contempt is essentially criminal liability, vicarious liability has no application to contempt proceedings as such liability is unknown to criminal law. Second, the principle of delegation, according to which an individual may be held liable for the acts of his delegate, applies only to cases in which the delegator is under a specific statutory duty that has been contravened by the delegate. The appellants were under no analogous duty in this case. Third, the theory of identification, according to which a corporation may be held criminally liable for the acts of the directing mind of the corporation, is inapplicable to natural persons.
Cases Cited
Referred to: Poje v. Attorney General for British Columbia, 1953 CanLII 34 (SCC), [1953] 1 S.C.R. 516; In re Bramblevale Ltd., [1970] Ch. 128; Kimpton v. Eve (1813), 2 V. & B. 349, 35 E.R. 352; Ex parte Langley (1879), 13 Ch. D. 110; Baxter Travenol Laboratories of Canada Ltd. v. Cutter (Canada), Ltd., 1983 CanLII 30 (SCC), [1983] 2 S.C.R. 388; Avery v. Andrews (1882), 51 L.J. Ch. 414; Re Gordon MacKay & Co. and Dominion Rubber Co., 1946 CanLII 318 (ON CA), [1946] 3 D.L.R. 422; Bank of British North America v. St. John & Quebec R. Co. (1920), 1920 CanLII 376 (NB CA), 52 D.L.R. 557 (N.B.C.A.), aff'd (1921), 1921 CanLII 574 (SCC), 62 S.C.R. 346; Re Botiuk and Collision (1979), 1979 CanLII 2060 (ON CA), 26 O.R. (2d) 580; Re National Trust Co. and Bouckhuyt (1987), 1987 CanLII 4098 (ON CA), 61 O.R. (2d) 640; Allen v. Whitehead, [1930] 1 K.B. 211; Canadian Dredge & Dock Co. v. The Queen, 1985 CanLII 32 (SCC), [1985] 1 S.C.R. 662; R. v. Stevanovich (1983), 1983 CanLII 1604 (ON CA), 7 C.C.C. (3d) 307; Re B.C. Motor Vehicle Act, 1985 CanLII 81 (SCC), [1985] 2 S.C.R. 486; R. v. Burt, 1987 CanLII 4619 (SK CA), [1988] 1 W.W.R. 385.
Statutes and Regulations Cited
Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10 [now R.S.C., 1985, c. F‑7], ss. 46, 52.
Federal Court Rules, C.R.C. 1978, c. 663, Rules 308, 311(1), (2), 355(2), (4).
Authors Cited
Mewett, Alan W. and Morris Manning. Criminal Law, 2nd ed. Toronto: Butterworths, 1985.
APPEAL from a judgment of the Federal Court of Appeal, 1988 CanLII 9415 (FCA), [1988] 1 F.C. 171, 46 D.L.R. (4th) 1, 82 N.R. 360, 30 Admin. L.R. 104, reversing a judgment of the Trial Division, 1985 CanLII 5553 (FC), [1986] 2 F.C. 3, 24 D.LR. (4th) 111, 2 F.T.R. 18. Appeal allowed.
Harold Veale, Q.C., and Eric Bowie, Q.C., for the appellants.
Clayton Ruby and Michael Code, for the respondent.
//Sopinka J.//
The judgment of the Court was delivered by
SOPINKA J. -- This appeal is from the decision of the Federal Court of Appeal which reversed the judgment of the Trial Division and found the appellant Ministers guilty of contempt of court for disobeying an order of the Federal Court. The principal issue is whether acceptance of service of the order by the solicitor for the Ministers is sufficient knowledge of the order on their part to found liability in contempt.
The Facts
The respondent Bhatnager, a Canadian citizen living in Canada, filed a notice of motion in the Federal Court of Canada on June 5, 1985, seeking a writ of mandamus to compel the appellant Minister of Employment and Immigration to order her officers to process the application for permanent residence in Canada of the respondent's husband, an Indian citizen living in India. There had, to that time, been a delay of almost five years in the processing of the respondent's husband's application.
Prior to the hearing of the respondent's motion, an affidavit of Mr. Lou Ditosto, an immigration officer, was filed on behalf of the Minister. On July 11, 1985, in the course of cross-examination on that affidavit, counsel for the Minister agreed to produce the Ministry's New Delhi file concerning Mr. Bhatnager's application for admission, for the purposes of cross-examination. The hearing of the respondent's mandamus application was adjourned to September 3, 1985.
Several telexes were sent by Ministry officials to the New Delhi office requesting the file, but over a month passed with no sign of it. The respondent brought two motions: first, for an order that the Secretary of State for External Affairs be added as a party respondent to her application for mandamus, because overseas visa officers are his employees; and second, for an order for production of the New Delhi file. Associate Chief Justice Jerome of the Federal Court, Trial Division, acceded to both motions, and issued an order on August 15, 1985, in open court, and in the presence of counsel for the appellants. The relevant part of the formal order reads as follows:
... THAT the [appellants] direct their officials to produce the file or a copy of the file relating to the [respondent], Debora Bhatnager and her husband, Ajay Kant Bhatnager, from the Canadian High Commission in New Delhi, India to Lou Ditosto, an Immigration Officer of the [appellants], so that the [respondent] may complete cross examination on the affidavits filed herein, forthwith and in time for the scheduled hearing of this matter of September 3, 1985.
On August 20, 1985, a copy of the order of August 15 was served on the appellants' solicitor by the respondent's solicitor. There is, however, no evidence that the order was served on either of the appellants, or that they were ever informed of its existence.
On August 26, 1985, counsel for the parties agreed to continue the cross-examination of the appellants' representative on August 29, on the assumption that the file or a copy of it would be available by that date. Counsel for the respondent received what purported to be a copy of the file on August 27, but in the course of the cross-examination it was discovered that several relevant documents were missing. In the meantime, the original file had arrived in Ottawa by diplomatic bag, on August 28. For some reasons which were not explained in evidence, the file did not arrive in Toronto until the morning of Friday, August 30, 1985 -- the last business day before the hearing of the respondent's application for mandamus.
The respondent's application for mandamus was heard by Strayer J. commencing on September 3, 1985. During the hearing of the application, counsel for the respondent argued that a show cause order ought to issue against the appellants in relation to their alleged failure to comply with the order of August 15. Strayer J. agreed, and the show cause order issued on October 4, 1985. Shortly thereafter, Strayer J. granted the order of mandamus with reasons dated October 15, 1985. The show cause hearing commenced on December 5, 1985, and in reasons dated December 20, 1985, Strayer J. held that the allegations of contempt against the appellants had not been made out.
The Judgments Below
Strayer J. (1985 CanLII 5553 (FC), [1986] 2 F.C. 3) held first that, in his view, the spirit of the order of August 15 had not been obeyed by the responsible officials in the two departments involved. He was of the view that the order required that effective directions be given to ensure that the file arrive in Toronto at least by the beginning of the week preceding September 3, 1985.
On the question of the appellants' personal responsibility for the failure to comply with the August 15 order, Strayer J. held that the common law requires actual personal knowledge of the order. Such knowledge could be proved by evidence of personal service or of the acquisition of knowledge by some other means. There was nothing in this case showing that the appellants ever had personal knowledge of the order and therefore they could not be personally responsible for having failed to carry out the order. Strayer J. rejected the argument that the provisions in the Federal Court Rules, C.R.C. 1978, c. 663, that permit service of an order of the court on a party's solicitor of record operate to fix a party with knowledge of the order for the purposes of grounding a finding of contempt.
Strayer J. concluded by rejecting the present respondent's arguments that the appellants are vicariously liable for the contempt of court committed by their employees. Strayer J. took the view that no analogy could be drawn between the appellants and a "corporation sole", and that the more appropriate analogy was the situation of a minister of the Crown whose employee commits a tort: such a minister is not vicariously liable for the tort.
The Federal Court of Appeal unanimously allowed the present respondent's appeal from the judgment of Strayer J.: 1988 CanLII 9415 (FCA), [1988] 1 F.C. 171. Urie J., speaking for the court, held that Strayer J. had erred in considering common law principles on the requirements for a finding of contempt in the face of clear provisions in the Federal Court Rules. Urie J. took the view that the Rules are "a comprehensive code for the manner in which notice of court orders is to be effected". Urie J. stated, at p. 185:
On the evidence there can be no doubt that those Rules were fully complied with in this case so that both the pronouncement of the order in open court in the presence of the duly authorized representative of the [appellants], and its subsequent service on him, constituted notice to them as surely as if they had been personally present and served therewith.
Urie J. proceeded to consider whether the allegation of contempt had been substantiated. Exercising the power granted by s. 52 of the Federal Court Act, R.S.C. 1970 (2nd Supp.), c. 10 (now R.S.C., 1985, c. F-7), to the Federal Court of Appeal to render the decision which the Trial Division ought to have given, the court held that Strayer J.'s findings of fact amply established that the acts for which the appellants were to be held responsible were contumacious in character.
The matter was remitted to Strayer J. for the assessment of penalty. In an order dated March 30, 1988, Strayer J. imposed no penalty upon the appellants apart from an award of costs to the respondent on a solicitor and client basis.
The Issues
The parties have raised the following issues:
Whether the appellants can be found guilty of contempt of court based on their alleged failure to comply with the Associate Chief Justice's order where there is no evidence that they had actual knowledge of the order but the order was served on the solicitor for the appellants.
Whether the Federal Court Rules are to be interpreted so as to fix the appellants with personal knowledge of the order of the Associate Chief Justice by reason of service of it on the solicitor for the appellants.
Whether the doctrine of vicarious liability applies in proceedings for contempt of court brought against an individual, and whether the appellant Ministers of the Crown are vicariously liable for the contumacious conduct of their officials.
Whether the principle of vicarious liability, or, in the event of an affirmative answer to issue 2, the Federal Court Rules are inconsistent with ss. 7 and 11(d) of the Canadian Charter of Rights and Freedoms.
I find that it is necessary to deal only with issues 1, 2 and 3.
Actual Knowledge
It is well to remember at the outset that an allegation of contempt of court is a matter of criminal (or at least quasi-criminal) dimension: see Poje v. Attorney General for British Columbia, 1953 CanLII 34 (SCC), [1953] 1 S.C.R. 516, per Kellock J., at pp. 517-18; and In re Bramblevale Ltd., [1970] Ch. 128 (C.A.), per Lord Denning, M.R., at p. 137. In the present case, a finding of guilt could have subjected the appellants to a fine of as much as $5,000 and the possibility of imprisonment to a maximum of one year: see Rule 355(2). It is necessary, therefore, that the constituent elements of contempt be proved against the appellants, and proved beyond a reasonable doubt.
The element at issue in the present case is the common law requirement of knowledge of the order alleged to have been breached. The appellants contend that since there was no evidence that they had been informed of the existence or content of the order of August 15, they could not, as a matter of law, be held liable in contempt for disobedience of the order. The onus of proof is on the party alleging contempt, and that onus has not been discharged. The respondent, on the other hand, contends that service of the order on the appellants' solicitor gives rise to a rebuttable presumption of actual knowledge, or at least shifts the evidentiary burden to the appellants ‑‑ on the footing that the natural inference to be drawn from service on a party's solicitor is that the solicitor will have informed the party of the order. The appellants led no evidence concerning their knowledge or lack of knowledge, and so, the argument goes, the presumption created by service operates to fix them with knowledge.
On the cases, there can be no doubt that the common law has always required personal service or actual personal knowledge of a court order as a precondition to liability in contempt. Almost two centuries ago, in Kimpton v. Eve (1813), 2 V. & B. 349, 35 E.R. 352, Lord Chancellor Eldon held that a party could not be held liable in contempt in the face of uncontradicted evidence that he or she had no knowledge of the order. In Ex parte Langley (1879), 13 Ch. D. 110 (C.A.), Thesiger L.J. stated the principle as follows, at p. 119:
... the question in each case, and depending upon the particular circumstances of the case, must be, was there or was there not such a notice given to the person who is charged with contempt of Court that you can infer from the facts that he had notice in fact of the order which had been made? And, in a matter of this kind, bearing in mind that the liberty of the subject is to be affected, I think that those who assert that there was such a notice ought to prove it beyond reasonable doubt.
More recently, this Court adverted to the knowledge requirement in contempt in Baxter Travenol Laboratories of Canada Ltd. v. Cutter (Canada), Ltd., 1983 CanLII 30 (SCC), [1983] 2 S.C.R. 388, per Dickson J. (as he then was), at pp. 396-97.
This lengthy history of a strict requirement at common law that the party alleging contempt must prove actual knowledge on the part of the alleged contemnor is inconsistent with the submission that a rebuttable presumption arises in every case upon service of the order on the solicitor. In my opinion, a finding of knowledge on the part of the client may in some circumstances be inferred from the fact that the solicitor was informed. Indeed, in the ordinary case in which a party is involved in isolated pieces of litigation, the inference may readily be drawn. In the case of Ministers of the Crown who administer large departments and are involved in a multiplicity of proceedings, it would be extraordinary if orders were brought, routinely, to their attention. In order to infer knowledge in such a case, there must be circumstances which reveal a special reason for bringing the order to the attention of the Minister. Knowledge is in most cases (including criminal cases) proved circumstantially, and in contempt cases the inference of knowledge will always be available where facts capable of supporting the inference are proved: see Avery v. Andrews (1882), 51 L.J. Ch. 414.
This does not mean that Ministers will be able to hide behind their lawyers so as to flout orders of the court. Any instructions to the effect that the Minister is to be kept ignorant may attract liability on the basis of the doctrine of wilful blindness. Furthermore, the fact that a Minister cannot be confident in any given case that the inference will not be drawn will serve as a sufficient incentive to see to it that officials are impressed with the importance of complying with court orders.
Applying the foregoing to this case, it is plain that Strayer J. did not infer knowledge on the part of the Ministers in the circumstances; nor did the Court of Appeal. Indeed, for reasons which I shall address shortly, Urie J. imputed the requisite knowledge to the appellants in such a way that even conclusive proof of an absence of knowledge on their part would not have availed. There is, therefore, no finding of fact on the record that the appellants had knowledge of the order of August 15. Neither is one warranted. Accordingly, at common law they cannot be held liable in contempt.
The Federal Court Rules
The relevant portions of the Federal Court Rules read as follows:
Rule 308. A document that by virtue of these Rules is required to be served on any person need not be served personally unless the document is one that, by a provision of these Rules or by order of the Court, is expressly required to be so served.
Rule 311. (1) Service of a document, not being a document that is required to be served personally, may be effected
(a) by leaving a copy of the document at the address for service of the person to be served;
(2) For the purposes of paragraph (1) if, at the time when service is effected, the person on whom a document is to be served has no "address for service", as that expression is defined by Rule 2(1), his address for service shall be deemed to be one of the following:
(a) in any case, the business address of the attorney or solicitor, if any, who is acting for him in the proceeding in connection with which service of the document in question is to be effected;
The respondent, supporting Urie J.'s judgment, claims that these rules provide a comprehensive code for effecting notice of court orders. Urie J. held that the service of the order on the appellants' counsel created a "presumption of proper notice" that could be rebutted only if the appellants led evidence to show that their counsel acted without authority in accepting service. The appellants reject this interpretation of the Rules and, taking the matter one step further, argue that if the Rules were interpreted to have this effect they would be ultra vires the rule-making power granted to the judges of the Federal Court by s. 46 of the Federal Court Act.
With respect to Urie J., I cannot interpret the Federal Court Rules as having the effect he ascribed to them, apart altogether from any Charter considerations that might have come into play if I had held otherwise. While it is true that there are provisions in the Rules for personal service (e.g. Rule 355(4)), it does not follow that the permission in Rule 308 to effect service other than personally is determinative of the issue of knowledge in a contempt of court proceeding. The relevant Rules define what is effective service for the purposes of the expeditious conduct of litigation in the Federal Court, but they do not purport to detract from the elements necessary to establish contempt. It seems to me that a crucial requirement for the proof of a serious offence such as contempt of court could not be implicitly abrogated by a provision in subordinate legislation; such an alteration of the general law would require explicit language. As Hogg J.A. stated in Re Gordon MacKay & Co. and Dominion Rubber Co., 1946 CanLII 318 (ON CA), [1946] 3 D.L.R. 422 (Ont. C.A.), at p. 425:
The common law rights of the subject are not to be taken away or affected except only to such extent as may be necessary to give effect to the intention of Parliament when clearly expressed or when such result must follow by necessary implication, and if the rights of persons are encroached upon, this intention must be made manifest by the language of the statute, if not by express words then by clear implication and beyond reasonable doubt.
It cannot be doubted that the knowledge of a solicitor is the knowledge of the client for some purposes, particularly in civil cases in which an individual's knowledge of the status of a commercial transaction is at issue: see Bank of British North America v. St. John & Quebec R. Co. (1920), 1920 CanLII 376 (NB CA), 52 D.L.R. 557 (N.B.C.A.), aff'd (1921), 1921 CanLII 574 (SCC), 62 S.C.R. 346; Re Botiuk and Collision (1979), 1979 CanLII 2060 (ON CA), 26 O.R. (2d) 580 (C.A.), per Wilson J.A. (as she then was), at p. 589; and Re National Trust Co. and Bouckhuyt (1987), 1987 CanLII 4098 (ON CA), 61 O.R. (2d) 640 (C.A.), per Cory J.A. (as he then was), at pp. 643-44. While this principle of imputation of knowledge is a necessary feature of our adversary system of civil litigation, in which representation by counsel is the rule rather than the exception, it ought not to apply in the criminal or quasi-criminal context of a contempt prosecution in the absence of express legislative language to the contrary. As the Federal Court Rules do not contain such language, it is unnecessary to deal with the argument that the Rules are ultra vires.
Vicarious Liability
Counsel for the respondent presented this Court with elaborate arguments in support of the proposition that the appellants ought to be held liable in contempt in the absence of knowledge of the breached order, on the basis of some form of vicarious liability, variously referred to as the principle of delegation and the theory of identification. Counsel sought to analogize the appellants to licensees and corporations in relation to which these principles have been applied in the past: see, e.g. Allen v. Whitehead, [1930] 1 K.B. 211; and Canadian Dredge & Dock Co. v. The Queen, 1985 CanLII 32 (SCC), [1985] 1 S.C.R. 662.
Given the premise that liability in contempt is essentially criminal liability, the respondent's main hurdle on this issue is that, in general, vicarious liability is unknown to the criminal law. As Estey J. stated in Canadian Dredge & Dock Co., at p. 692:
In the criminal law, a natural person is responsible only for those crimes in which he is the primary actor either actually or by express or implied authorization. There is no vicarious liability in the pure sense in the case of the natural person.
However, the respondent, while conceding that the doctrine of respondeat superior does not apply, urges that either or both of the sub-doctrines of delegation and identification ought to ground the appellants' liability in contempt. There are, to my mind, at least two fatal objections to the respondent's position on this issue.
First, the principle of delegation, according to which an individual may be held criminally liable for the acts of his or her delegate, has long been understood to apply, if at all, to cases in which the delegator is under a specific statutory duty that has been contravened by the delegate: see A. W. Mewett and M. Manning, Criminal Law (2nd ed. 1985), at p. 64; Allen, supra, per Lord Hewart C.J. at p. 220; and R. v. Stevanovich (1983), 1983 CanLII 1604 (ON CA), 7 C.C.C. (3d) 307 (Ont. C.A.), per Dubin J.A. (as he then was), at p. 315. It is not necessary to express a view on the correctness of this apparent departure from the general rule against vicarious liability in the criminal law, since it is sufficient to observe that in the circumstances of the present case the appellants are under no analogous duty.
Second, the theory of identification, according to which a corporation may be held criminally liable for the acts of the directing mind of the corporation, is uniquely inapplicable to natural persons. As Estey J. explained in Canadian Dredge & Dock Co., at p. 693, the theory of identification "is a court-adopted principle put in place for the purpose of including the corporation in the pattern of criminal law in a rational relationship to that of the natural person." Since a corporate entity cannot have a mind of its own, it was necessary to select some responsible official (the directing mind) whose mind was identified as that of the corporation. To now apply the theory of identification to natural persons would be to turn the principle on its head. It would be, in my view, a manifestly unjust application to an individual of simple vicarious liability under another name.
In light of these conclusions, it is unnecessary to consider whether a contrary interpretation of the Federal Court Rules or a finding of vicarious criminal liability would constitute a violation of ss. 7 and 11(d) of the Canadian Charter of Rights and Freedoms; though it seems clear that any argument in favour of such liability would have grave difficulty overcoming the decision of this Court in Re B.C. Motor Vehicle Act, 1985 CanLII 81 (SCC), [1985] 2 S.C.R. 486. (See also R. v. Burt, 1987 CanLII 4619 (SK CA), [1988] 1 W.W.R. 385 (Sask. C.A.), per Bayda C.J.S.)
Disposition
In view of the foregoing, the appellants ought not to have been found liable in contempt. I would, therefore, allow the appeal and restore the decision of Strayer J. of December 20, 1985. In accordance with the terms upon which leave was granted, the respondent shall have her costs throughout on a solicitor and client basis.
Appeal allowed.
Solicitor for the appellants: John C. Tait, Ottawa.
Solicitors for the respondent: Rudy & Edwardh, Toronto.