Charter Rights and State Liability: SCC Reiterates Threshold for Claims Against the State for Damages

On July 19, 2024, the Supreme Court of Canada (SCC) rendered judgment in Canada (Attorney General) v. Power (Power) on the availability of damages against the federal or provincial governments for enacting legislation contrary to the Canadian Charter of Rights and Freedoms (Charter). The SCC had previously opened the door to such claims in Mackin v. New Brunswick (Minister of Finance) (Mackin). The SCC’s decision in Power clarifies the threshold for damages in such circumstances and raises the question of whether the same principles apply to legislation that violates Quebec’s Charter of Human Rights and Freedoms (Quebec Charter).

No Absolute Immunity 

In Power, the plaintiff alleged that his Charter rights had been violated when Parliament retrospectively changed the availability of criminal record suspensions for certain offenders. The plaintiff claimed damages against Canada under s. 24(1) of the Charter. Canada conceded that the law infringed the Charter but argued that the damages claim should be dismissed on the basis that Canada enjoys absolute immunity from damages for the enactment of unconstitutional legislation. Canada brought a preliminary motion to dismiss the claim.

In a split decision, the SCC rejected Canada’s claim for absolute immunity, reiterating principles established in Mackin 22 years earlier: the state enjoys a limited, not absolute, immunity from liability in damages when unconstitutional legislation harms an individual. The Court held that to obtain damages for the enactment of legislation that violates a Charter right, a plaintiff would have to demonstrate that the law was “clearly unconstitutional, in bad faith or an abuse of power”; otherwise, the state is immune from the damages claim. According to the SCC, Canada’s claim of absolute immunity failed to reconcile the constitutional principles protecting legislative autonomy, such as parliamentary sovereignty, parliamentary privilege and the separation of powers, with the constitutional principles requiring government accountability, such as constitutionalism and the rule of law. As a result, the SCC dismissed the AGC’s preliminary motion to strike, allowing the plaintiff to proceed with his action for damages against the Crown.

Application to Quebec Charter? 

Do the principles set out in Power and Mackin apply where the Quebec Charter is at issue, particularly where an expropriation of property is contrary to the Quebec Charter?

In Quebec (Commission des droits de la personne et des droits de la jeunesse) v. Communauté urbaine de Montréal, the SCC unanimously held that the Quebec Charter, being a source of fundamental law, must be interpreted according to the principles of Canadian constitutional law. These principles may include the right, as recognized in Mackin and Power, to sue the state following the enactment of a law that is later found unconstitutional. Under s. 49 of the Quebec Charter, any interference with any right or freedom recognized by the Quebec Charter entitles the victim to obtain compensation for the moral or material prejudice resulting from the infringement.

However, unlike the Canadian Charter, the Quebec Charter protects property rights. Section 6 provides that every person has a right to the peaceful enjoyment and free disposition of their property, “except to the extent provided by law.” Expropriation is an infringement of this right. Under article 952 of the Civil Code of Québec, property owners cannot be compelled to transfer their property “except by expropriation according to law for public utility and in return for a just and prior indemnity.”

Power raises the question of whether owners of property that was expropriated can claim damages from the state on the grounds that the expropriating law infringes their right under s. 6 of the Quebec Charter, at least where the law is clearly unconstitutional, is in bad faith or constitutes an abuse of power. It appears such a claim may be possible in the right circumstances if the Quebec Charter is interpreted in the context of Mackin and Power.

Conclusion 

In Power, the SCC confirmed that the state has limited, and not absolute, immunity for enacting legislation contrary to the Charter. Although the bar is high, a claim may be brought against the federal or provincial governments, as well as any local government such as a municipality, for enacting a law that violates the rights and freedoms guaranteed under the Charter if the law is clearly unconstitutional, in bad faith or an abuse of power. It will be interesting to see how the courts apply these principles to cases involving the Quebec Charter, particularly with respect to the right to the peaceful enjoyment and free disposition of property under s. 6.