CANADA Trends and Developments Contributed by: Laura Bevan, Craig Ferris KC, Anna Paczkowski and Catherine Whitehead, Lawson Lundell LLP
Introduction In this year’s edition of Trends and Develop- ments, we begin with a discussion of the Supreme Court of Canada’s (the “SCC”) land- mark decision in Canada (Attorney General) v Power (the “Power case”), on the availability of damages under the Canadian Charter of Rights and Freedoms (the “Charter”) for unconsti- tutional legislation. We go on to examine the SCC’s application of the modern approach to contractual interpretation to clauses excluding liability in Earthco Soil Mixtures Inc v Pine Val- ley Enterprises Inc (the “Earthco case”), and the Alberta Court of Appeal’s refusal to extend an environmental “super priority” to private litigants in Qualex-Landmark Towers Inc v 12-10 Capital Corp (the “Qualex case”). We describe the Ontario Court of Appeal’s deci- sion in 660 Sunningdale GP Inc v First Source Mortgage Corp (the “Sunningdale case”), over- turning the lower court’s refusal to enforce the payment of a substantial commitment fee on the grounds it was an unconscionable and unen- forceable penalty, and conclude with a review of the British Columbia Court of Appeal’s confirma- tion in Bhuthal v Sahsi (the “Bhuthal case”), that the BC Corporations Act governs the appoint- ment of a person to defend or prosecute pro- ceedings on a company’s behalf. No Absolute Immunity for Unconstitutional Legislation Can monetary damages ever be a just and appropriate remedy under Section 24(1) of the Charter when the government enacts legislation that is later declared to be unconstitutional? That was the deceivingly complex constitutional issue the SCC took up in the Power case. A 5-4 majority of the SCC concluded they can (in limited circumstances), affirming that the state
only enjoys limited, not absolute, immunity when exercising its legislative function. The question arose on a preliminary motion by the Attorney General of Canada to strike out a claim by Joseph Power (“Mr Power”) for dam- ages and other relief under Section 24(1) of the Charter. Section 24(1) of the Charter provides that anyone whose Charter rights or freedoms have been infringed or denied may apply for “such remedy as the court considers appropri- ate and just in the circumstances”. In 1996, Mr Power was convicted of two indict- able offences for which he served a custodial sentence. At the time of his conviction, a person convicted of an indictable offence could apply for a record suspension (ie, a pardon) five years after their release. Following his release, Mr Power trained for and found employment as a medical radiation technologist. The Canadian Parliament subsequently enact- ed legislation that made individuals convicted of certain criminal offences permanently ineli- gible for a record suspension. The transitional provisions of the relevant statutes provided the legislation applied retrospectively to offences committed before the Acts came into force. As a result, Mr Power became permanently ineligible for a record suspension. Mr Power lost his job in 2011 when his prior criminal convictions were discovered, and he was unable to secure a new job in his field as a result of his criminal record. He applied for, but was denied, a record suspension. The retrospective application of the laws pre- cluding Mr Power from a record suspension was later found to be unconstitutional, and in the Power case the Attorney General of Canada
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