ONTARIO SUPERIOR COURT OF JUSTICE
DATE: 20120127
between:
LARRY PHILIP FONTAINE et al.
Plaintiffs
- and –
THE ATTORNEY GENERAL OF CANADA
Defendants
REQUEST FOR DIRECTION REGARDING PERSONAL CREDITS FOR EDUCATION
DIRECTION
[1] On December 15, 2006, the courts in nine provinces and territories concurrently issued reasons approving a national settlement concluding various class actions related to the Indian Residential Schools throughout Canada. These reasons were followed by a set of orders, incorporating the Settlement Agreement and addressing issues pertaining to the implementation and administration of the Settlement. The orders were issued in substantially the same form in each court.
[2] Pursuant to the Settlement Agreement, Canada placed $1.9 billion into a trust fund referred to as the “Designated Amount Fund” (the “Fund”). The Fund was intended to be allocated among eligible claimants for the Common Experience Payment (“CEP”) in accordance with the provisions of the Settlement Agreement.
[3] Article 5.07(1) of the Settlement Agreement provides as follows:
5.07 Excess Designated Amount
(1) If the audit under Section 5.05(2) determines that the balance in the Designated Amount Fund exceeds the amount required to make the Common Experience Payment to all Eligible CEP Recipients who have applied before the CEP Application Deadline by more than forty million dollars ($40,000,000.00), the excess will be apportioned pro rata to all those who received a Common Experience Payment to a maximum amount of three thousand dollars ($3,000.00) per person in the form of Personal Credits.
[4] Personal Credits are defined by the Settlement Agreement as follows:
“Personal Credits” means credits that have no cash value, are transferable only to a family member who is a member of the family class as defined in the Class Actions or the Cloud Class Action, may be combined with the Personal Credits of other individuals and are only redeemable for either personal or group education services provided by education entities or groups jointly approved by Canada and the Assembly of First Nations pursuant to terms and conditions to be developed by Canada and the Assembly of First Nations. Similar sets of terms and conditions will be developed by Canada and Inuit Representatives for Eligible CEP Recipients having received the CEP who are Inuit. In carrying out these discussions with the Assembly of First Nations and Inuit Representatives, Canada shall obtain input from counsel for the groups set out in Section 4.09(4)(d), (e), (f) and (g);
[5] It is clear, at this point, that there will be a surplus in excess of $40,000,000 remaining in the Fund after satisfaction of all eligible CEP claims. As a result, parties to the Settlement Agreement now seek authorization to commence the process of developing terms and conditions applicable to the approval of eligible education providers in relation to the redemption of Personal Credits.
[6] This process is proposed to include retaining three education experts, one by each of Canada, the AFN and Inuit Representatives, as well as an expert in Class Action Settlement Administration.
[7] Proposed Statements of Work for each of the experts proposed to be retained, including budgetary estimates, have been placed before the Court for approval.
[8] While the Court takes no issue with the proposed scope of work for each of the experts to be retained, the estimated costs associated with retaining these experts varies widely. The cost of retaining Canada’s expert is estimated at $131,700, including $30,000 in estimated travel costs. Costs associated with retaining the expert in Inuit education is also estimated at $131,700, which includes $30,000 in estimated travel costs and $33,900 in estimated ‘support costs’. Similarly, the costs of retaining the Settlement Administration expert are estimated to be $165,600, including $30,000 in estimated travel costs.
[9] Retaining the AFN expert, on the other hand, is estimated to cost $305,555, including a combined $30,000 in estimated travel costs and ‘consultation visits’, $84,000 for an ‘IRS Coordinator’ and associated travel costs, $50,000 for ‘National Consultations’, and $39,855 for ‘Administration @ 15%’.
[10] A Request for Direction has been placed before the Court for an order approving the Statements of Work, appointment of the experts selected to fill the roles in question, and for the payment of costs associated with the experts out of the Fund.
Analysis
[11] It appears that no parties to the Settlement Agreement have opposed the order sought in the Request for Direction. It must be noted, however, that the process proposed is intended to be funded from the trust fund held for the benefit of all claimants in accordance with the terms of the Settlement Agreement. As such, those funds cannot be expended unless the Court is satisfied that such expenditure is reasonable in the circumstances.
[12] The cost estimates associated with retaining the experts for Canada and the Inuit Representatives offer a useful basis against which the reasonableness of the estimates for the AFN expert may be evaluated. On this basis, the daily rate proposed for the Expert’s Fee appears reasonable, as it aligns with the daily rate paid to Canada’s expert. Similarly, it appears to be common ground that $30,000 is a reasonable estimate of travel costs over the course of the project. Finally, although the proposed ‘Administration’ amount associated with the AFN expert ($39,855) is somewhat greater than the ‘Expert Support’ amount for the expert in Inuit education ($33,900), this difference is not beyond reason.
[13] In my view, the estimated costs associated with an IRS Coordinator and national consultations are not necessary expenditures at this stage. The role of the AFN’s expert is to develop, in concert with the other experts, terms and conditions applicable to the redemption of Personal Credits. The purpose of employing an expert in this exercise is to focus consultation with AFN so that a workable proposal may be developed for presentation to the courts. The additional expenditures requested by the AFN are not necessary to accomplish that objective at present.
[14] In light of the above, it would be reasonable to limit expenditures from the Fund for the AFN’s education expert to $171,555.00, allocated as follows:
a. Expert Fees: $101,700
b. Travel: $30,000
c. Administration: $39,855
Order
[15] Subject to the above comments and modifications, the order sought in the Request for Direction is hereby granted.
Date: January 27, 2012 _____________________________
Winkler C.J.O.