Quebec (Attorney General) v. Canada

Quebec (Attorney General) v. Canada Court (s) Database Federal Court of Appeal Decisions Date 2009-12-09 Neutral citation 2009 FCA 361 File numbers A-426-08 Notes Digest Decision Content Federal Court of Appeal CANADA Cour d'appel fédérale Date: 20091209 Docket: A-426-08 Citation: 2009 FCA 361 CORAM: LÉTOURNEAU J.A. NADON J.A. PELLETIER J.A. BETWEEN: ATTORNEY GENERAL OF QUEBEC Appellant and HER MAJESTY THE QUEEN in right of Canada Respondent Heard at Montréal, Quebec, on December 2, 2009. Judgment delivered at Ottawa, Ontario, on December 9, 2009. REASONS FOR JUDGMENT BY: LÉTOURNEAU J.A. CONCURRED IN BY: NADON J.A. PELLETIER J.A. Federal Court of Appeal CANADA Cour d'appel fédérale Date: 20091209 Docket: A-426-08 Citation: 2009 FCA 361 CORAM: LÉTOURNEAU J.A. NADON J.A. PELLETIER J.A. BETWEEN: ATTORNEY GENERAL OF QUEBEC Appellant and HER MAJESTY THE QUEEN in right of Canada Respondent REASONS FOR JUDGMENT LÉTOURNEAU J.A. Issues [1] This appeal puts in issue the interpretation and application by Justice Montigny of the Federal Court (judge) of the Act to authorize the making of contributions by Canada toward the cost of programs for the provision of assistance and welfare services to and in respect of persons in need, S.C. 1966‑67, c. 45, R.S.C. 1985, c. C‑1 (Act). With this Act, Parliament created the Canada Assistance Plan (CAP). According to the appellant, the judge made errors of law as well as palpable and overriding errors of fact in interpreting Quebec’s right to cost sharing of social services provided in schools and support services offered to adults with disabilities living in residential resources. [2] More specifically, as regards the social services in schools, the appellant criticizes the judge for: a) erring in deciding that CAP does not provide for cost sharing of provincial social services when these services are not offered solely to persons in need; b) erring in his interpretation of the Act creating CAP and of the expression “welfare services” found in section 2 of that Act; c) erring in fact and in law in concluding that social services in schools are not “welfare services” within the meaning of the Act; and, lastly, d) erring in ruling that social services offered in Quebec schools between 1973 and 1996 are services subject to “the exclusion of services relating wholly or mainly to education”. [3] With regard to the second aspect of the appeal, that is, social services for persons with disabilities living in residential resources, the judge made two mistakes. [4] First, he allegedly erred in ruling against cost sharing when the provincial social services are not offered solely to those in need. [5] Second, the judge could not find that the social services offered to the clientele described above fall under the category of adult residential care services. The period at issue for these services is from 1986 to 1996. Relevant legislation [6] Relevant to the resolution of this case are sections 2, 3 and 4 of the Act, sections 1 to 8 of the Canada Assistance Plan Regulations, C.R.C. 1978, c. 382, and sections 1, 2, 23 and 24 of the Federal-Provincial Fiscal Arrangements and Established Programs Financing Regulations, 1977, SOR/78‑587, July 24, 1978. They are reproduced in the appendix to these reasons. Facts [7] It is not necessary here to repeat the history of CAP and of the relations between the parties, which was fully expounded by the judge in his 107‑page judgment, indexed as Quebec (Attorney General) v. Canada, 2008 FC 713. It is sufficient to present some of the facts essential to understanding the issue and grounds of appeal. [8] The proceeding, brought under section 19 of the Federal Courts Act, R.S.C. 1985, c. F‑7, is for a declaratory judgment on certain provisions of CAP. Section 19 allows the Federal Court to rule on a dispute between Canada and a province if that province passes an act agreeing that this Court has jurisdiction over the subject of the dispute. [9] The issue arises from the federal government’s refusal to share in the costs incurred by the province of Quebec for three types of services provided at various times over CAP’s lifespan. Only the two types of services listed above are contemplated in the appeal, since the third involves services for young offenders from 1979 to 1984. [10] CAP was repealed in 1996 with the coming into force of the Canada Health and Social Transfer (Federal‑Provincial Fiscal Arrangements Act, R.S.C. 1985, c. F‑8, Part V, as amended by the Budget Implementation Act, 1995, S.C. 1995, c. 17). The federal contribution to the cost of provincial public assistance and welfare services programs then became a per capita grant. [11] CAP allows federal and provincial governments to enter into agreements to share the costs of assistance and various welfare services. On August 21, 1967, both parties entered into an agreement that included the three following schedules: Schedule A: homes for special care; Schedule B: provincially approved agencies authorized to provide welfare services; Schedule C: provincial Acts governing assistance or welfare services under conditions consistent with CAP. [12] Although the appellant’s action was commenced in 1996, it was not until 10 years later that the hearing was held, after negotiations failed between the parties. [13] Approximately 30 witnesses, including 10 experts, were heard by the judge. Some 131 documents were filed in evidence. On June 6, 2008, the judge rendered his decision, dismissing the appellant’s action with costs. Analysis of the decision and grounds of appeal [14] For the purposes of the analysis, the grounds of appeal a), b) and c) are grouped together. 1) The judge’s alleged error regarding the cost sharing of social services in schools when these services are not offered solely to persons in need, his interpretation of the Act and of the concept of “welfare services”, and his conclusion that social services offered in schools are not welfare services within the meaning of the Act [15] The appellant argues that the judge rejected and dismissed the concept of cost sharing when and because the social services programs offered in schools had a general purpose and were not intended solely for poor people. [16] With respect, I am of the opinion that this argument of the appellant is based on a misreading of the judge’s reasons for decision. [17] As shown by paragraphs 44 and 56 of his reasons, reproduced below, the judge recognized and accepted cost sharing for programs where a clientele of persons in need, that is, persons unable to support themselves, overlapped with a wealthier clientele receiving the same social services: [44] It is true that CAP also provided for funding for welfare services and even encouraged the further development and extension of such services. Those services (which, it will be recalled, had as their object the lessening, removal or prevention of the causes and effects of poverty, child neglect or dependence on public assistance) were eligible for cost sharing if they were delivered to persons in need or “persons who are likely to become persons in need”. [56] This client/program distinction that Professor Vaillancourt seems to be the only one to have made strikes me as a diversion that adds nothing to the debate. It is not in dispute that the only services for which cost sharing was possible were those delivered to persons in need and, in the case of welfare services, persons for whom imminence of need was identified. Moreover, the evidence shows that the proportion of eligible clients for each service for which cost sharing was claimed was determined using a complex mechanism for dividing them up, as mutually agreed by the parties. This was no doubt an operational challenge given the differing philosophies and eligibility criteria of CAP and the provincial programs. For costs to be shareable in whole or in part (depending on the nature of the clientele), the program itself also had to be approved by the federal authorities and the provincial Act creating it had to be in Schedule C of the agreement. In other words, the program established by the provincial Act had to be considered a “welfare service” to be eligible for cost sharing. It is on this point that the two parties disagree. [Emphasis added] [18] The reasons for decision show that the judge’s dismissal of the appellant’s compensation claim is not based on the rejection of the concept of cost sharing but, rather, on the fact that social services in schools are not part of a program of “welfare services” as defined by CAP. [19] In other words, the judge, adopting the definition of “welfare services” at section 2 of CAP, concluded that services offered in schools were not “services having as their object the lessening, removal or prevention of the causes and effects of poverty, child neglect or dependence on public assistance”. At paragraphs 56 and 63, the judge wrote the following: [56] (in fine) For costs to be shareable in whole or in part (depending on the nature of the clientele), the program itself also had to be approved by the federal authorities and the provincial Act creating it had to be in Schedule C of the agreement. In other words, the program established by the provincial Act had to be considered a “welfare service” to be eligible for cost sharing. [63] Thus, parliamentarians obviously recognized CAP as an anti‑poverty measure designed to support provincial programs that sought to assist the clientele of economically disadvantaged persons. It is no doubt from this general perspective, namely, the lessening, removal and prevention of the causes and effects of poverty and dependence on public assistance, that we must understand the inclusion of services for neglected children as welfare services and the inclusion, in the definition of persons in need, of persons under the age of 21 years who were in the care or under the supervision of a child welfare authority or whose parents were unable to support them and who therefore became foster‑children. [Emphasis added] [20] The judge was of the view that the school social services emphasized instead the socioacademic functioning of students in school, such that these services “were closely connected with and complementary to the educational mission of educational institutions or, as the Government of Canada put it, that they embraced the goals, objectives, purpose and specificity thereof” (see paragraphs 301 to 314 and 316 of the reasons for decision). [21] In short, the judge concluded that the school program and the social services it offers are inconsistent with both the general objective of CAP and the objective of the concept of “welfare services” as defined in the Act. [22] One need only consider the causes for social intervention in schools to be convinced and to understand that they have nothing to do with fighting poverty: absenteeism, violence, substance abuse in school, academic failure and its psycho‑social impact, emotional and social maladjustment in school, certain students’ difficulties integrating and adapting in school, schools dealing with grief reactions in certain children, school phobia, conflicts between school and family values and the impact on the child, suspension or expulsion of a student and its psycho‑social aspects, negative psycho‑social aspects of bussing, etc. (see the respondent’s Condensed Book, Volume 1, at pages 128 to 131). [23] The appellant did try to connect this type of school‑based intervention with CAP by arguing that it is meant as preventive intervention to stop problems from escalating and leading to poverty. [24] While CAP allows for cost sharing of preventive interventions in respect of persons who are likely to become persons in need unless such services are provided, the intervention must be justified by a real rather than hypothetical imminence of need. The imminence of need contemplated by CAP refers to an imminent probability, not a mere latent possibility. Otherwise, it amounts to saying that any welfare service is eligible for CAP, since each beneficiary always harbours the possibility of one day falling into the clutches of poverty. [25] I would add that the fact that a service provider organization is listed in the schedules to the agreement between the federal and provincial governments does not mean that all of the services offered by that organization are necessarily covered by CAP. To be eligible for cost sharing, these services must fulfill the objectives and purposes of CAP. [26] The judge carried out a meticulous analysis of the extensive testimonial and written evidence submitted by the parties on the issue. He very carefully explained and justified his refusal at times to accept evidence or his decision other times to favour one piece of evidence over another. The assessment of the evidence, of its probative value and of its sufficiency was within his jurisdiction as trial judge. It warrants, and receives, this Court’s deference. [27] With respect, I am of the opinion that the evidence fully justified his conclusion and that there is no error in either the conclusion or supporting reasoning and reasons that might justify this Court’s intervention. [28] In making the argument to extend CAP to services in schools, the appellant relies on Finlay v. Canada (Minister of Finance), [1993] 1 S.C.R. 1080, and, in particular, the following passage at page 1123, where the Supreme Court refers to the preamble of the Act: . . . the Parliament of Canada . . . is desirous of encouraging the further development and extension of assistance and welfare services programs throughout Canada by sharing more fully with the provinces in the cost thereof. [emphasis in original] [29] There is no doubt that the cost sharing of welfare services according to the economic criteria of CAP was intended to, and did, encourage the provinces to improve and extend the coverage of the programs. However, that did not mean that, regardless of the goals and objectives of CAP, funding would, or should, extend to the cost of all improvements and extensions of programs that make them universal plans where services are provided based on criteria that go beyond the economic criteria of CAP. Moreover, at page 1124 of Finlay, Justice Sopinka, writing for the majority, recognized the need to respect the overall objective of CAP. Referring to the Act creating CAP, he wrote: Ambiguities in the legislation should be resolved in so far as is possible on the basis of the interpretation which respects the overall purpose and objective of CAP. [30] In analyzing the eligibility of social services in schools, the judge was right not to disregard the overall objective of CAP, which is the fight against poverty, as well as the more specific objective contained in the definition of “welfare services”, which is “the lessening, removal or prevention of the causes and effects of poverty”: see section 2 of the Act. 2) The judge’s alleged error in concluding that social services offered in Quebec schools between 1973 and 1996 are services subject to “the exclusion of services relating wholly or mainly to education” [31] The judge concluded that these school services are not eligible for CAP. Despite this, for the sake of being thorough, since these services are not included in CAP program, and seeing it as a confirmation of his approach regarding eligibility, the judge ruled on the meaning and scope of the exclusion clause, which, as mentioned above, excludes services that relate wholly or mainly to education. [32] Having agreed with his finding that school services are ineligible, I do not believe that it would be useful or necessary for me to rule on the exclusion and will therefore refrain from doing so. 3) The judge’s alleged error in concluding that social services offered to adults with disabilities living in residential resources fall under the category of adult residential care services [33] Beginning in the early 60s, the deinstitutionalization of persons with physical or mental disabilities led to their relocation in neighbourhood residences, where they enjoyed greater autonomy and a more normal and less dehumanizing lifestyle. Obviously, the housing conditions, supervision and necessary services varied depending on the severity of the disability. [34] Quebec legislation refers to these neighbourhood residences as residential resources. At issue here for the purposes of cost sharing are residential resources where residential assistance and supervision are provided at all times, that is, 24 hours a day, 7 days a week, at the beneficiaries’ homes. They are known as “residential resources with continuous assistance”. The clientele consists of persons whose disabilities are such that, alone, they are unable to completely ensure their health and safety: see the testimony of D. Bérubé, respondent’s Condensed Book, Volume 2, pages 161 to 170. They fall under level 3 and 4 categories, those at level 4 needing a more intensive level of support than those at level 3, especially during the day, when two workers are required for three or four beneficiaries. [35] The respondent refused to pay the costs claimed for these services on the basis that they were excluded from cost sharing under paragraph 5(2)(c) of CAP, as they were covered by another Act of Parliament, namely, the Fiscal Arrangements Act, 1977, S.C. 1977, c. 10, coupled with the Federal‑Provincial Fiscal Arrangements and Established Programs Financing Regulations, 1977, SOR/78‑587. [36] The Fiscal Arrangements Act, 1977 finances adult residential care services, which are defined as personal and supervisory care, assistance with the activities of daily living and social and recreational services, room and board services, as well as services required in the operation of the institution where the beneficiaries live. [37] There is a legal and operational connection between the Fiscal Arrangements Act, 1977 and CAP: institutions in respect of adults are defined in the Fiscal Arrangements Act, 1977 as homes for special care within the meaning of CAP, which defines them as “residential welfare institution[s] the primary purpose of which is to provide residents thereof with supervisory, personal or nursing care or to rehabilitate them socially”: see section 2 of CAP and the Canada Assistance Plan Regulations, cited above. [38] On reading the judge’s reasons for decision, I understand that he drew two conclusions based on the nature, intensity and purpose of the services offered to the clientele of residential resources with continuous assistance. First, he concluded that these residential resources were homes for special care within the meaning of CAP because the services provided there amounted to adult residential care services. Second, he found that these services did not meet the definition of “welfare services” at section 2 of CAP in that “it was not proved that the services provided to persons with disabilities had as their object ‘the lessening, removal or prevention of the causes and effects of poverty, child neglect or dependence on public assistance’”: see paragraph 406, as well as paragraphs 401 to 405 and 407 to 416 of his reasons for decision. [39] At most, both of these conclusions are findings of mixed fact and law, in that the judge took findings of fact and applied statutory definitions to them. [40] Moreover, his findings of fact are supported by ample evidence and contain no palpable and overriding errors. The same may be said for his application of the legal concepts at issue, as his understanding of these concepts reveals no error of law that would allow or justify this Court’s intervention. Conclusion [41] For these reasons, I would dismiss the appeal with costs. “Gilles Létourneau” J.A. “I agree M. Nadon J.A.” “I agree J.D. Denis Pelletier J.A.” Certified true translation Tu-Quynh Trinh FEDERAL COURT OF APPEAL NAMES OF COUNSEL AND SOLICITORS OF RECORD DOCKET: A-426-08 STYLE OF CAUSE: ATTORNEY GENERAL OF QUEBEC v. HER MAJESTY THE QUEEN in right of Canada PLACE OF HEARING: Montréal, Quebec DATE OF HEARING: December 2, 2009 REASONS FOR JUDGMENT BY: LÉTOURNEAU J.A. CONCURRED IN BY: NADON J.A. PELLETIER J.A. DATED: December 9, 2009 APPEARANCES: Dominique Rousseau Mélanie Paradis FOR THE APPELLANT René Leblanc Yannick Landry Guy A. Blouin FOR THE RESPONDENT SOLICITORS OF RECORD: Chamberland, Gagnon Québec, Quebec FOR THE APPELLANT John H. Sims, Q.C. Deputy Attorney General of Canada FOR THE RESPONDENT