Class Actions Takeaways from Canada v. Power: Where Next for Charter Damages?

In a decision of interest to those involved in Charter class actions, the Supreme Court recently revisited and reaffirmed the (limited) availability of Charter damages in relation to unconstitutional legislation in Canada (Attorney General) v. Power, 2024 SCC 26 (“Power”).

Subject to legislation that retrospectively rendered him permanently ineligible for a suspension of his criminal record, Joseph Power sought Charter damages under s. 24, and a declaration of invalidity under s. 52. He pled that the enacting legislation clearly violated the Charter, was enacted in bad faith and was abusive.

Canada Asks the Court to Find That an Absolute Immunity Applies

In response, Canada brought a motion on a question of law that it would, in time, pursue up to the Supreme Court of Canada.

By the time that Canada's motion was heard, the legislation in question had been declared unconstitutional by the Supreme Court of British Columbia, the Federal Court, and the Ontario Superior Court of Justice.[1]

Conceding the unconstitutionality of the applicable laws, Canada argued – despite the court's statement in Mackin v. New Brunswick (Minister of Finance) (“Mackin”), that damages are available for laws that are "clearly wrong, in bad faith or an abuse of power"[2] – that Charter damages are never available for the enactment of legislation later found to violate Charter rights.

That argument for an absolute immunity failed before the motion judge and was rejected by the New Brunswick Court of Appeal.[3] It found a mixed audience at the Supreme Court.

The Majority Upholds and Clarifies Mackin

Chief Justice Wagner and Karakatsanis J., writing together for the majority, dismissed the appeal and reaffirmed the limited immunity set out in Mackin.

The majority found that the state does not enjoy an absolute immunity from liability for damages when it enacts unconstitutional legislation that infringes Charter rights.[4] While the state enjoys a limited immunity in exercising its law-making powers, that immunity will not apply where it is shown that a law "was clearly unconstitutional, or that its enactment was in bad faith or an abuse of power."[5] This "high threshold," is, in the view of the majority, "not insurmountable."[6]

Upholding the Mackin threshold, the majority clarified it only slightly. "Negligence" – despite being referred to in Mackin – is not sufficient as it "does not connote the gravity of misconduct this threshold was designed to capture."[7] As the majority also acknowledged, "clearly wrong," as a standard, may lack clarity. The majority clarified that the objective inquiry required focuses on whether legislation is "clearly unconstitutional", with regards to the nature and extent of its constitutional invalidity and presuming "the legislature's knowledge of and respect for basic Charter rights."[8]

Striking the Constitutional Balance: The Need for Government Accountability

In the course of making these findings, the majority affirmed the significance of government accountability as a constitutional principle.

Before the court, Canada relied heavily on three constitutional principles that – it argued – could not be reconciled with anything less than an absolute immunity: parliamentary sovereignty, the separation of powers, and parliamentary privilege.[9]

Those principles, the majority found, must be balanced against and reconciled with the rule of law, respect for constitutional rights, and legislative accountability.[10] There are, in the majority's words, no "hierarchies of constitutional principles."[11] Instead, the jurisprudence has strived, "to provide flexibility and accommodation in the pursuit of good governance and fundamental rights."[12] The balance that is needed between government autonomy and government accountability is, in the majority's view, best struck through the limited Mackin immunity.

Endorsing the courts' role in upholding the Charter, the majority states: "Courts are constitutionally obliged to hold the government accountable when it breaches such rights, including by providing meaningful remedies in the face of their violation."[13]

The majority's view, it appears, is that the enactment of the Charter fundamentally altered Canada's constitutional structure by encoding Constitutional rights, and – through s. 24 – charging courts with providing effective remedies when those rights are violated.

Here, the majority and the two dissenting sets of reasons of Jamal J. (dissenting only in part), and Rowe J. diverge. While those reasons differ in their findings, both suggest that pre-existing constitutional principles were not altered or modified by the enactment of the Charter and that, instead, the Charter must be read in accordance with those pre-existing principles.[14]

A New Question Arises: Prior Enactments that Become "Clearly Unconstitutional"

While the majority's decision clarifies the availability of Charter remedies, it sows at least one fresh seed of doubt.

The majority states that the limited Mackin immunity will not apply "where the legislation was 'clearly unconstitutional' in the sense that, at the time of its enactment, it would clearly violate Charter rights."[15]

But what of old laws that, while not clearly unconstitutional at the time of their enactment, were – by the time they were applied to a particular individual – clearly unconstitutional?

In Brazeau v. Canada (“Brazeau”), the Court of Appeal for Ontario dismissed good governance concerns raised by Canada, finding that Canada's "clear disregard" for the Class (who were subject to unconstitutional administrative segregation) "dates back to at least the start dates for these claims."[16] This suggests that it is not only the time of enactment that matters: damages are also available where a government continues to apply a clearly unconstitutional law.

Given the majority's repeated reliance on Brazeau, including as an example of the proper s. 24(1) analysis, it seems unlikely that they intended to disagree on this issue.[17] However, given the majority's explicit wording, this issue may arise in future Charter claims.

What Next for Charter Damages?

To date, Power has received only limited treatment. That may change when the Saskatchewan Court of Appeal hears the appeal in Saskatchewan (Minister of Education) v. UR Pride Centre for Sexuality and Gender Diversity, a challenge to the Saskatchewan Government's policy on the use of chosen names and pronouns by school students.

While that appeal focuses on s. 33(1), the notwithstanding clause, the Court of Appeal – in deciding intervention applications – granted the parties leave to make submissions addressing the decision in Power.[18] Those submissions could result in a decision that clarifies the application of Power to government policy and, potentially, the interaction between ss. 24 and 33 of the Charter.

For now, the majority's decision in Power will remain useful to those litigating class actions with Charter claims for both its vindication of government accountability as a principle and its continued entrenchment of the (limited) availability of Charter damages for unconstitutional legislation.

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