Committe for Monetary and Economic Reform v. Canada

Committe for Monetary and Economic Reform v. Canada
Court (s) Database
Federal Court Decisions
Date
2014-04-24
Neutral citation
2014 FC 380
File numbers
T-2010-11
Decision Content
Date: 20140424
Docket: T-2010-11
Citation: 2014 FC 380
Ottawa, Ontario, April 24, 2014
PRESENT: The Honourable Mr. Justice Russell
BETWEEN:
COMMITTE FOR MONETARY AND ECONOMIC REFORM ("COMER"), WILLIAM KREHM, AND ANN EMMETT
Plaintiffs
and
HER MAJESTY THE QUEEN,
THE MINISTER OF FINANCE,
THE MINISTER OF NATIONAL REVENUE,
THE BANK OF CANADA,
THE ATTORNEY GENERAL OF CANADA
Defendants
REASONS FOR ORDER AND ORDER
INTRODUCTION
[1] This is a motion under Rule 51 of the Federal Court Rules, SOR/98-106 [Rules], appealing the Order of Prothonotary Aalto dated 9 August 2013 [Decision], which struck the Plaintiffs’ Amended Statement of Claim [Claim] without leave to amend.
BACKGROUND
[2] The Plaintiff Committee for Monetary and Economic Reform [COMER] is an economic “think-tank” based in Toronto, which was established in 1970 and is dedicated to research and publications on issues of monetary and economic reform in Canada. The individual Plaintiffs are members of COMER who have an interest in economic policy.
[3] The Plaintiffs brought a novel proposed class action proceeding alleging that the Defendants have acted in ways that are unlawful, unconstitutional and tortious in their handling of monetary and budgetary policy and administration in Canada. In their Claim, the Plaintiffs sought a number of declarations that the Defendants are required by the Constitution and the Bank of Canada Act, RSC, 1985, c B-2 [Bank Act] to take, or refrain from, certain actions relating to their handling of fiscal and monetary matters, described further below. They also sought a declaration that the Defendants, along with certain international monetary and financial institutions, have “engaged in a conspiracy… to render impotent the Bank Act, as well as Canadian sovereignty over financial, monetary, and socio-economic policy…,” with injurious consequences to the Defendants and all Canadians. On the basis of this alleged tortious conduct, Charter breaches, as well as alleged breaches of the Constitution, the Plaintiffs sought damages in the amount of $10,000 for each Plaintiff and, should the action be certified as a class action proceeding, $1.00 for “every Canadian citizen/resident” as determined by the last census.
[4] While the Claim was filed as a “Proposed Class Action Proceeding” (see Rule 334.12 (1)), to date, no motion for certification has been brought under Rule 334.12(2). Thus, at this stage, the matter before the Court is not a class proceeding. In the event that the Claim or some portion of it were to survive the motion to strike, the question of certification would remain to be decided separately. If certification were to be denied, the Court would need to determine if the Claim should be permitted to proceed as an individual proceeding (see Rule 334.2). In this motion, however, the Court is concerned solely with the question of whether the Claim meets the legal requirements for a statement of claim.
[5] The nine declarations sought in the Claim relate to three basic assertions: first, that the Bank Act provides for interest-free loans to the federal and provincial, as well as municipal, governments for the purposes of “human capital expenditures,” and the Defendants have failed to fulfill their legal duties to ensure such loans are made, resulting in lower human capital expenditures by governments to the detriment of all Canadians; second, that the government of Canada [Government] uses flawed accounting methods in describing public finances, thereby understating the benefits of human capital expenditures and undermining Parliament’s constitutional role as the guardian of the public purse; and third, that these and other harms are the result of the fact that Canadian fiscal and monetary policy is being controlled by private foreign interests through Canada’s involvement in international monetary and financial institutions.
[6] The pleadings describe human capital expenditures as those that promote the health, education and quality of life of individuals in order to make them more productive economic actors, through institutions such as schools, universities and hospitals. The Plaintiffs seek a declaration that s.18(i) and (j) of the Bank Act require the Minister of Finance [Minister] and the Government to request, and the Bank of Canada [Bank] to provide, interest-free loans for the purpose of such expenditures by all levels of government (federal, provincial and municipal). They further seek declarations that the Minister, the Government and the Bank have abdicated their statutory and constitutional duties by failing to request and make these interest-free loans, and that this has had negative and destructive impact on Canadians through the disintegration of Canada’s economy and its financial institutions, an increase in public debt, a decrease in social services, a widening gap between the rich and the poor and the continuing disappearance of the middle class.
[7] The Plaintiffs also seek two declarations relating to the manner in which the Minister accounts for public finances. First, the Claim seeks a declaration that the Minister is required to list human capital expenditures, including infrastructure capital expenditures as “assets” rather than “liabilities” in budgetary accounting. The pleadings allege that so long as human capital expenditures are treated only as “liability” and “debt,” with no corresponding asset value, governments will not invest in human capital infrastructure. Second, the Claim seeks a declaration that, in essence, the Minister is required not to net out tax credits in showing Government revenues in budgetary accounting. Rather, the Minister must list all revenues prior to the return of tax credits to individual and corporate tax payers, then subtract tax credits, and then subtract total expenditures in order to arrive at an annual “surplus” or “deficit.” The Claim alleges that the Minister’s accounting, by not setting out the total tax credits given back to taxpayers, is fallacious, inaccurate and ultra vires, and has the effect of foreclosing any real debate of budgetary matters by elected Members of Parliament because an accurate financial picture is not available or disclosed. The Plaintiffs allege that the Minister’s accounting method breaches s. 91(5) of the Constitution Act, 1867 (clarified in argument to be s. 91(6), “The Census and Statistics”) because it results in “an inaccurate and unavailable ‘statistic,’” and that it violates the “constitutional guarantee that the Crown can only imposes [sic] taxes, for the declared proposed expenditures, as set out in the throne speech, upon the consent (over the taxing power) of the House of Commons.” In argument, though not in the Claim itself, the Plaintiffs relate the latter proposition to ss. 53, 54 and 90 of the Constitution Act, 1867.
[8] Four of the declarations sought in the Claim relate to the assertion that the Defendants have unlawfully ceded control over Canada’s monetary and fiscal policies to foreign private interests. First, the Claim seeks a declaration that s. 18(m) of the Bank Act and its administration and operation are unconstitutional, amounting to an abdication of the Defendants’ duty to govern in matters of monetary, financial and socio-economic policy, and a ceding of control to international private entities whose interests are placed above those of Canadians. Second, the Claim seeks a declaration that the actions of the Governor of the Bank of Canada [Governor], in keeping secret and not open to parliamentary and public scrutiny the minutes of meetings with other central bank governors, has acted contrary to s. 24 of the Bank Act and the Constitution. Third, the Claim seeks a declaration that Parliament has abdicated its constitutional duties and function under s. 91(1A), (3), (14), (15), (16), (18), (19) and (20) of the Constitution Act, 1867, as well as s. 36 of the Constitution Act, 1982, by allowing the Governor to keep the nature and content of his meetings with other central bankers secret, by not exercising Parliament’s authority under s.18(i) and (j) of the Bank Act, and by enacting s.18(m) of that Act. Finally, the Claim seeks a declaration that the Defendants’ officials are:
wittingly and/or unwittingly, in varying degrees, knowledge, and intent, engaged in a conspiracy, along with the [Bank of International Settlements, Financial Stability Board, and International Monetary Fund], to render impotent the Bank Act, as well as Canadian sovereignty over financial, monetary, and socio-economic policy, and in fact by-pass the sovereign rule of Canada, through its Parliament, by means of banking and financial systems, which conspiracy and elements of such tortious conduct are set out, in inter alia, Hunt v. Carey Canada Inc. [1990] 2 S.C.R. 959…
[9] In this regard, the Claim alleges that:
• the Bank was set up in the 1930s as a vehicle to provide interest-free loans to federal and provincial governments for infrastructure and human capital expenditures, and for maintaining sovereign control over credit and currency with the purpose of asserting domestic and public control of monetary and economic policy;
• the Bank provided interest-free loans to federal, provincial and municipal governments in its “early and middle existence,” but stopped doing so in 1974 - after joining the Bank of International Settlements [BIS] - in favour of interest-bearing loans from foreign private banks;
• the BIS, which purports to facilitate co-operation and serve as a “bank for central banks,” in fact formulates and dictates policies to central banks;
• the BIS is not accountable to any government and its annual meetings are secret;
• policies such as interest rates are set by the Bank in consultation with, or at the direction of, the Financial Stability Board [FSB], established in 2009 after the “G-20” London Summit and linked to the BIS. The FSB also operates in a secretive and unaccountable fashion;
• the Bank is the only central bank among the G-8 countries that is a “public” bank created by statute and accountable to the legislative and executive branches of Government, with the others all being “private” banks not directly governed by legislation or directly accountable to the legislative or executive branches of their respective countries;
• the Bank was completely independent of international private interests before joining the BIS in 1974, but since then the Bank and Canada’s monetary and financial policy have gradually come to be largely dictated by private foreign financial interests;
• after Canada’s entry into the BIS, an agreement or directive was reached within that organization that the member central banks would not be used to create or lend interest-free money, but rather governments would obtain loans from and through the BIS;
• the ceding of control to foreign private interests is unconstitutional and the agreement or directive not to make interest-free loans to governments is contrary to the Bank Act; and
• these unlawful actions have had severe detrimental effects for Canadian citizens, including the development of a spiralling schism between the rich and the poor, the elimination of the middle class, and a corresponding rise in crime related to poverty.
[10] The Claim also seeks a declaration that what the Plaintiffs characterize as “the privative clause” in s.30.1 of the Bank Act either: a) does not apply to prevent judicial review, by way of action or otherwise, with respect to statutorily or constitutionally ultra vires action, or to prevent the recovery of damages based on such actions; or b) if it does prevent such review and recovery, that it is unconstitutional and of no force and effect, as breaching the Plaintiffs’ constitutional right to judicial review and the underlying constitutional imperatives of the rule of law, Constitutionalism and Federalism.
[11] The Plaintiffs further allege that the unlawful actions described above violate the rights of every Canadian under s.7 of the Charter, through a reduction, elimination or delay of health care, education and other services, as well as Canadians’ equality rights under s.15 of the Charter, the underlying constitutional right to equality, the underlying constitutional principle of federalism, the equalization provisions in s.36 of the Constitution Act, 1982, and the constitutional right not to have statutes rendered impotent through Parliament’s de facto abdication of its duty to govern.
[12] The Defendants brought a motion to strike the Claim on the grounds that, inter alia:
i) the Claim fails to disclose a reasonable cause of action against the Defendants, or any one of them;
ii) the Claim is scandalous, frivolous or vexatious;
iii) the Claim is an abuse of process of the Court;
iv) the Claim fails to disclose facts which would show that the action or inaction of the Defendants, or any one of them, could cause an infringement of the Plaintiffs’ rights under the Charter or the Constitution;
v) the causal link between the alleged action or inaction of the Defendants or any one of them, and the alleged infringement of the Plaintiffs’ rights is too uncertain, speculative and hypothetical to sustain a cause of action;
vi) the Claim seeks to adjudicate matters that are not justiciable;
vii) the Claim concerns matters outside the jurisdiction of the Federal Court.
[13] The parties’ submissions on the motion to strike were heard on 5 December 2012, and on 9 August 2013 Prothonotary Aalto granted the motion, striking the Claim in its entirety without leave to amend. On 16 August 2013, the Plaintiffs brought this motion under Rule 51(1) appealing the Prothonotary’s decision.
DECISION UNDER REVIEW
[14] Prothonotary Aalto noted that, on a motion to strike, the allegations in a statement of claim are accepted to be true, and the issue for determination was whether the Claim was so fatally flawed as to be bereft of any chance of success (citing Operation Dismantle Inc. v Canada, [1985] 1 SCR 441 [Operation Dismantle Inc.] at para 27, Hunt v Carey Canada Inc., [1990] 2 SCR 959 [Hunt], and R v Imperial Tobacco Canada Ltd, 2011 SCC 42 [Imperial Tobacco] at paras 17, 21 and 25). He characterized the Claim as having three core elements:
1. The Bank and Crown refuse to provide interest-free loans for capital expenditures;
2. The Crown uses flawed accounting methods in describing public finances, which provides the rationale for refusing to grant interest-free loans; and
3. These and other harms are caused by the Bank being controlled by private foreign interests.
[15] He looked first at whether the tort of misfeasance in public office had been made out in relation to the allegation that the Defendants have abdicated their responsibility to enforce legislation. He noted that each essential element of the tort must be clearly pleaded, and that vague generalizations are insufficient. Rather, the Claim must be particularized (citing Adventure Tours Inc v St. John’s Port Authority, 2011 FCA 198 [St. John’s Port Authority]). He found that the allegations relating to the abdication of responsibility and ceding of control to foreign entities were “general statements of economic policy and argument” and “do not support a cause of action.” The allegation of misfeasance in public office was found to be bereft of any chance of success and was struck.
[16] Prothonotary Aalto also found that the allegation of conspiracy was bereft of any chance of success. He found that, as drafted, there was no particularization of the parties alleged to be involved in the conspiracy, and he noted the generality of the statement that the “defendants’ (officials) are wittingly and/or unwittingly, in varying degrees, knowledge, and intent, engaged in a conspiracy.” He found that the tort of conspiracy requires an agreement between two or more persons who intend to injure by unlawful means, and that there were no material facts pleaded to support such a claim.
[17] With respect to s.15 of the Charter, Prothonotary Aalto found that a successful claim under this provision requires that there be differential treatment between the claimants and others, or substantive inequality (citing Withler v Canada (Attorney General), 2011 SCC 12 [Withler] at paras 41 and 63), and that the Claim in the present case did not plead any distinction based on enumerated or analogous grounds. Noting that the claim was asserted on behalf of all Canadians, he cited the finding in Canadian Egg Marketing Agency v Richardson, [1998] 3 SCR 157 [Richardson] at para 161 that “[p]rovided the federal government treats all people within the country equally, it does not discriminate.” On this basis, he found that the s.15 claim should be struck.
[18] Prothonotary Aalto also found that s.7 of the Charter was not engaged because no causal connection was pleaded between the impugned Government economic policies and actions and an infringement of the right to life, liberty and security of the person. The Claim alleged only that this right was breached “by a reduction, elimination and/or fatal delay of health care services, education and other human capital expenditures and services.” He applied the statement in Blencoe v British Columbia (Human Rights Commission), [2000] 2 SCR 307 [Blencoe] at para 59 that “[i]t would be inappropriate to hold government accountable for harms that are brought about by third parties who are not in any sense acting as agents of the state.” He also found, based on Gosselin v Quebec (Attorney General), 2002 SCC 1484 [Gosselin] at para 213, that s.7 rights do not encompass positive rights. Rather, a s.7 claim must arise “as a direct result of a determinative state action that in and of itself deprives the claimant of the right to life, liberty or security of the person,” and since no negative infringement or state prohibition of a s.7 interest had been pleaded, this aspect of the Claim had to be struck.
[19] Prothonotary Aalto then turned to the question of the Court’s jurisdiction to consider the Claim. He rejected the Defendants’ position that the Court has no jurisdiction to entertain tort claims against Federal authorities, finding that the wording in ss. 2, 17, and 18 of the Federal Courts Act, RSC, 1985, c F-7 is broad enough to capture such claims against federal actors and Crown servants. He found that it is not plain and obvious that the Court does not have jurisdiction to entertain claims seeking declaratory relief.
[20] With respect to the Plaintiffs’ standing to bring the Claim, Prothonotary Aalto found that it was not clear from the pleadings that there had been interference with a private right resulting in damages so as to give rise to private interest standing. However, taking a flexible, liberal and generous approach as required by current jurisprudence, he concluded that it could not be said at this stage that COMER does not meet the test for public interest standing. If the allegations in the Claim were to be sufficiently amended to satisfy the rules of pleading, they would meet the element of a serious issue to be tried. Moreover, he found that COMER has a genuine interest in economic policy, and there appeared to be no alternative reasonable and effective means to bring the matter to Court. As such, the remainder of the Claim was not struck on the basis of standing.
[21] However, Prothonotary Aalto then found that the Claim was not justiciable, and struck the remaining portions of the Claim on that basis. He noted that justiciability refers to a matter’s suitability for determination by a Court, with reference to the subject matter for determination, its presentation and the appropriateness of judicial determination (citing Friends of the Earth v Canada (Governor in Council), [2009] 3 FCR 201 at paras 24-26, 31, 33-34, 38 [Friends of the Earth]; aff’d 2009 FCA 297). Prothonotary Aalto found that the issues in dispute in the Claim were “policy-laden,” requiring consideration of economic policy, and asked: “What objective legal criteria can be applied to interpret these provisions when economic issues such as those raised are matters of government policy?” He found that the courts are not the proper vehicle for declaring that the Government must change a policy if no legislative imperative exists. He found that s.18 of the Bank Act is a permissive section providing that certain powers “may” be exercised, which allows for discretion and considerations of policy in the implementation of those powers. There is, he found, no requirement that interest-free loans for human capital be made.
[22] Prothonotary Aalto took note of the Plaintiffs’ submission that there is “nothing in our constitutional arrangement to exclude ‘political questions’ from judicial review” where the Constitution is alleged to be violated (Chaoulli v Quebec (Attorney General), [2005] 1 SCR 791 at para 183 [Chaoulli]), and that all that is required for the Court to entertain a claim is a subject matter that has “a sufficient legal component to warrant the intervention of the judicial branch” (Reference Re Canada Assistance Plan (B.C), [1991] 2 SCR 525 [CAP Reference]). However, he was not persuaded that the Claim was justiciable. He quoted portions of the Claim alleging that the reasons for the Minister’s refusal of a loan were “financially and economically fallacious,” and that “it is long recognized that investment and expenditure in human capital is the most productive investment and expenditure a government can make,” and found that “[t]hese few examples from the Claim, of which there are many more, resonate with policy making implications not legal considerations.”
[23] Since the Claim was found not to be justiciable, Prothonotary Aalto found that leave to amend would not cure its defects, and should therefore not be granted.
ISSUES
[24] The issue on this motion is whether the Claim, or any portion of it, should be revived on the basis that it is not plain and obvious that it cannot succeed.
STANDARD OF REVIEW
[25] According to precedent, I am required to consider this matter de novo. That is, I am required to take a fresh look at the issues, affording no deference to the findings in the Decision being appealed from. That is because this is an appeal from an order of a Prothonotary on an issue (the striking of a claim) that is vital to the final determination of the case: Canada v Aqua-Gem Investments Ltd., [1993] 2 FC 425 (FCA) at 463; Merck & Co. v Apotex Inc., 2003 FCA 488 at para 19; Merck & Co. v Apotex Inc., 2012 FC 454. I would note parenthetically that the Federal Court of Appeal has questioned (without deciding) on at least one occasion whether this rule should continue to apply: Apotex Inc v Bristol-Myers Squibb Company, 2011 FCA 34 at para 9. However, having had no argument from the parties on this point, and given that most, if not all, of the findings at issue are findings of law on which no deference would be shown under the normal standards of appellate review from Housen v Nikolaisen, [2002] 2 SCR 235, I do not consider this to be an appropriate case to revisit the issue.
STATUTORY PROVISIONS
[26] The following provisions of the Bank Act are applicable in these proceedings:
Powers and business
18. The Bank may
[…]
(i) make loans or advances for periods not exceeding six months to the Government of Canada or the government of a province on taking security in readily marketable securities issued or guaranteed by Canada or any province;
(j) make loans to the Government of Canada or the government of any province, but such loans outstanding at any one time shall not, in the case of the Government of Canada, exceed one-third of the estimated revenue of the Government of Canada for its fiscal year, and shall not, in the case of a provincial government, exceed one-fourth of that government’s estimated revenue for its fiscal year, and such loans shall be repaid before the end of the first quarter after the end of the fiscal year of the government that has contracted the loan;
[…]
(m) open accounts in a central bank in any other country or in the Bank for International Settlements, accept deposits from central banks in other countries, the Bank for International Settlements, the International Monetary Fund, the International Bank for Reconstruction and Development and any other official international financial organization, act as agent or mandatary, or depository or correspondent for any of those banks or organizations, and pay interest on any of those deposits;
[…]
Fiscal agent of Canadian Government
24. (1) The Bank shall act as fiscal agent of the Government of Canada.
Charge for acting
(1.1) With the consent of the Minister, the Bank may charge for acting as fiscal agent of the Government of Canada.
To manage public debt
(2) The Bank, if and when required by the Minister to do so, shall act as agent for the Government of Canada in the payment of interest and principal and generally in respect of the management of the public debt of Canada.
Canadian Government cheques to be paid or negotiated at par
(3) The Bank shall not make any charge for cashing or negotiating a cheque drawn on the Receiver General or on the account of the Receiver General, or for cashing or negotiating any other instrument issued as authority for the payment of money out of the Consolidated Revenue Fund, or on a cheque drawn in favour of the Government of Canada or any of its departments and tendered for deposit in the Consolidated Revenue Fund.
[…]
No liability if in good faith
30.1 No action lies against Her Majesty, the Minister, any officer, employee or director of the Bank or any person acting under the direction of the Governor for anything done or omitted to be done in good faith in the administration or discharge of any powers or duties that under this Act are intended or authorized to be executed or performed.
Pouvoirs
18. La Banque peut :
[…]
i) consentir des prêts ou avances, pour des périodes d’au plus six mois, au gouvernement du Canada ou d’une province en grevant d’une sûreté des valeurs mobilières facilement négociables, émises ou garanties par le Canada ou cette province;
j) consentir des prêts au gouvernement du Canada ou d’une province, à condition que, d’une part, le montant non remboursé des prêts ne dépasse, à aucun moment, une certaine fraction des recettes estimatives du gouvernement en cause pour l’exercice en cours — un tiers dans le cas du Canada, un quart dans celui d’une province — et que, d’autre part, les prêts soient remboursés avant la fin du premier trimestre de l’exercice suivant;
[…]
m) ouvrir des comptes dans une banque centrale étrangère ou dans la Banque des règlements internationaux, accepter des dépôts — pouvant porter intérêt — de banques centrales étrangères, de la Banque des règlements internationaux, du Fonds monétaire international, de la Banque internationale pour la reconstruction et le développement et de tout autre organisme financier international officiel, et leur servir de mandataire, dépositaire ou correspondant;
[…]
Agent financier du gouvernement canadien
24. (1) La Banque remplit les fonctions d’agent financier du gouvernement du Canada.
Honoraires
(1.1) La Banque peut, avec le consentement du ministre, exiger des honoraires pour remplir de telles fonctions.
Gestion de la dette publique
(2) Sur demande du ministre, la Banque fait office de mandataire du gouvernement du Canada pour la gestion de la dette publique, notamment pour le paiement des intérêts et du principal de celle-ci.
Encaissement des chèques du gouvernement canadien
(3) La Banque ne peut exiger de frais pour l’encaissement ou la négociation de chèques tirés sur le receveur général ou pour son compte et d’autres effets autorisant des paiements sur le Trésor, ni pour le dépôt au Trésor de chèques faits à l’ordre du gouvernement du Canada ou d’un ministère fédéral.
[…]
Immunité judiciaire
30.1 Sa Majesté, le ministre, les administrateurs, les cadres ou les employés de la Banque ou toute autre personne agissant sous les ordres du gouverneur bénéficient de l’immunité judiciaire pour les actes ou omissions commis de bonne foi dans l’exercice — autorisé ou requis — des pouvoirs et fonctions conférés par la présente loi.
[27] The following provisions of the Constitution Act, 1867, are applicable in these proceedings
Appropriation and Tax Bills
53. Bills for appropriating any Part of the Public Revenue, or for imposing any Tax or Impost, shall originate in the House of Commons.
Recommendation of Money Votes
54. It shall not be lawful for the House of Commons to adopt or pass any Vote, Resolution, Address, or Bill for the Appropriation of any Part of the Public Revenue, or of any Tax or Impost, to any Purpose that has not been first recommended to that House by Message of the Governor General in the Session in which such Vote, Resolution, Address, or Bill is proposed.
[…]
Application to Legislatures of Provisions respecting Money Votes, etc.
90. The following Provisions of this Act respecting the Parliament of Canada, namely, — the Provisions relating to Appropriation and Tax Bills, the Recommendation of Money Votes, the Assent to Bills, the Disallowance of Acts, and the Signification of Pleasure on Bills reserved, — shall extend and apply to the Legislatures of the several Provinces as if those Provisions were here re-enacted and made applicable in Terms to the respective Provinces and the Legislatures thereof, with the Substitution of the Lieutenant Governor of the Province for the Governor General, of the Governor General for the Queen and for a Secretary of State, of One Year for Two Years, and of the Province for Canada.
Legislative Authority of Parliament of Canada
91. It shall be lawful for the Queen, by and with the Advice and Consent of the Senate and House of Commons, to make Laws for the Peace, Order, and good Government of Canada, in relation to all Matters not coming within the Classes of Subjects by this Act assigned exclusively to the Legislatures of the Provinces; and for greater Certainty, but not so as to restrict the Generality of the foregoing Terms of this Section, it is hereby declared that (notwithstanding anything in this Act) the exclusive Legislative Authority of the Parliament of Canada extends to all Matters coming within the Classes of Subjects next hereinafter enumerated; that is to say,
[…]
1A. The Public Debt and Property. (45)
[…]
3. The raising of Money by any Mode or System of Taxation.
4. The borrowing of Money on the Public Credit.
[…]
6. The Census and Statistics.
[…]
14. Currency and Coinage.
[…]
16. Savings Banks.
[…]
18. Bills of Exchange and Promissory Notes.
19. Interest.
20. Legal Tender.
[…]
Bills pour lever des crédits et des impôts
53. Tout bill ayant pour but l’appropriation d’une portion quelconque du revenu public, ou la création de taxes ou d’impôts, devra originer dans la Chambre des Communes.
Recommandation des crédits
54. Il ne sera pas loisible à la Chambre des Communes d’adopter aucune résolution, adresse ou bill pour l’appropriation d’une partie quelconque du revenu public, ou d’aucune taxe ou impôt, à un objet qui n’aura pas, au préalable, été recommandé à la chambre par un message du gouverneur-général durant la session pendant laquelle telle résolution, adresse ou bill est proposé.
[…]
Application aux législatures des dispositions relatives aux crédits, etc.
90. Les dispositions suivantes de la présente loi, concernant le parlement du Canada, savoir : — les dispositions relatives aux bills d’appropriation et d’impôts, à la recommandation de votes de deniers, à la sanction des bills, au désaveu des lois, et à la signification du bon plaisir quant aux bills réservés, — s’étendront et s’appliqueront aux législatures des différentes provinces, tout comme si elles étaient ici décrétées et rendues expressément applicables aux provinces respectives et à leurs législatures, en substituant toutefois le lieutenant-gouverneur de la province au gouverneur-général, le gouverneur-général à la Reine et au secrétaire d’État, un an à deux ans, et la province au Canada.
Autorité législative du parlement du Canada
91. Il sera loisible à la Reine, de l’avis et du consentement du Sénat et de la Chambre des Communes, de faire des lois pour la paix, l’ordre et le bon gouvernement du Canada, relativement à toutes les matières ne tombant pas dans les catégories de sujets par la présente loi exclusivement assignés aux législatures des provinces; mais, pour plus de garantie, sans toutefois restreindre la généralité des termes ci-haut employés dans le présent article, il est par la présente déclaré que (nonobstant toute disposition contraire énoncée dans la présente loi) l’autorité législative exclusive du parlement du Canada s’étend à toutes les matières tombant dans les catégories de sujets ci-dessous énumérés, savoir :
[…]
1A. La dette et la propriété publiques. (45)
[…]
3. Le prélèvement de deniers par tous modes ou systèmes de taxation.
4. L’emprunt de deniers sur le crédit public.
[…]
6. Le recensement et les statistiques.
[…]
14. Le cours monétaire et le monnayage.
[…]
16. Les caisses d’épargne.
[…]
18. Les lettres de change et les billets promissoires.
19. L’intérêt de l’argent.
20. Les offres légales.
[…]
[28] The following provisions of the Constitution Act, 1982, are applicable in these proceedings
Life, liberty and security of person
7. Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice.
[…]
Equality before and under law and equal protection and benefit of law
15. (1) Every individual is equal before and under the law and has the right to the equal protection and equal benefit of the law without discrimination and, in particular, without discrimination based on race, national or ethnic origin, colour, religion, sex, age or mental or physical disability.
[…]
Commitment to promote equal opportunities
36. (1) Without altering the legislative authority of Parliament or of the provincial legislatures, or the rights of any of them with respect to the exercise of their legislative authority, Parliament and the legislatures, together with the government of Canada and the provincial governments, are committed to
(a) promoting equal opportunities for the well-being of Canadians;
(b) furthering economic development to reduce disparity in opportunities; and
(c) providing essential public services of reasonable quality to all Canadians.
Commitment respecting public services
(2) Parliament and the government of Canada are committed to the principle of making equalization payments to ensure that provincial governments have sufficient revenues to provide reasonably comparable levels of public services at reasonably comparable levels of taxation.
Vie, liberté et sécurité
7. Chacun a droit à la vie, à la liberté et à la sécurité de sa personne; il ne peut être porté atteinte à ce droit qu’en conformité avec les principes de justice fondamentale.
[…]
Égalité devant la loi, égalité de bénéfice et protection égale de la loi
15. (1) La loi ne fait acception de personne et s’applique également à tous, et tous ont droit à la même protection et au même bénéfice de la loi, indépendamment de toute discrimination, notamment des discriminations fondées sur la race, l’origine nationale ou ethnique, la couleur, la religion, le sexe, l’âge ou les déficiences mentales ou physiques.
[…]
Engagements relatifs à l’égalité des chances
36. (1) Sous réserve des compétences législatives du Parlement et des législatures et de leur droit de les exercer, le Parlement et les législatures, ainsi que les gouvernements fédéral et provinciaux, s’engagent à :
a) promouvoir l’égalité des chances de tous les Canadiens dans la recherche de leur bien-être;
b) favoriser le développement économique pour réduire l’inégalité des chances;
c) fournir à tous les Canadiens, à un niveau de qualité acceptable, les services publics essentiels.
Engagement relatif aux services publics
(2) Le Parlement et le gouvernement du Canada prennent l’engagement de principe de faire des paiements de péréquation propres à donner aux gouvernements provinciaux des revenus suffisants pour les mettre en mesure d’assurer les services publics à un niveau de qualité et de fiscalité sensiblement comparables.
ARGUMENT
Plaintiffs
[29] The Plaintiffs argue that the Prothonotary erred in his ruling on justiciability by exceeding his jurisdiction and making substantive findings on the issues between the parties, in particular the proper construction of the term “may” in s.18 of the Bank Act, and the applicability of the Charter. They say that, according to Supreme Court jurisprudence, these are issues that must be left to the trial judge and not decided on a motion to strike. They also argue that the Prothonotary ignored pointed and clear jurisprudence on the issues before him, and completely failed to deal with the relief sought with respect to the constitutional, budgetary issues.
[30] The Plaintiffs remind the Court of the general principles to be applied on a motion to strike. The facts pleaded by the Plaintiffs must be taken as proven: Canada (Attorney General) v Inuit Tapirasat of Canada, [1980] 2 SCR 735; Nelles v Ontario (1989), DLR (4th) 609 (SCC) [Nelles]; Operation Dismantle Inc., above; Hunt, above; Dumont v Canada (Attorney General), [1990] 1 SCR 279 [Dumont]; Trendsetter Developments Ltd v Ottawa Financial Corp. (1989), 32 OAC 327 (CA) [Trendsetter]; Nash v Ontario (1995), 27 OR (3d) 1 (Ont CA) [Nash]; Canada v Arsenault, 2009 FCA 242 [Arsenault]. A claim should be struck “only in plain and obvious cases where the pleading is bad beyond argument” (Nelles, above, at 627), or where it is “‘plain and obvious’ or ‘beyond doubt’” that the claim will not succeed (Dumont, above, at 280; Trendsetter, above). It is inappropriate to strike a claim simply because it raises an “arguable, difficult or important point of law” (Hunt, above, at 990-91), or because it is a novel claim: Nash, above; Hanson v Bank of Nova Scotia (1994), 19 OR (3d) 142 (CA); Adams-Smith v Christian Horizons (1997), 14 CPC (4th) 78 (Ont Gen Div); Miller (Litigation Guardian of) v Wiwchairyk (1997), 34 OR (3d) 640 (Ont Gen Div). Indeed, in the law of torts in particular, this may make it critical that the claim proceed so that the law can evolve in response to modern needs (Hunt, above, at 991-92). Matters not fully settled by the jurisprudence should not be decided on a motion to strike: R.D. Belanger & Associates Ltd v Stadium Corp of Ontario Ltd (1991), 5 OR (3d) 778 (CA). The Plaintiffs say that, in order to succeed, the Defendants must produce a “decided case directly on point from the same jurisdiction demonstrating that the very same issue has been squarely dealt with and rejected”: Dalex Co v Schwartz Levitsky Feldman (1994), 19 OR (3d) 463 (Gen Div). Furthermore, the Court should be generous with respect to the drafting of the pleadings, permitting amendments before striking: Grant v Cormier – Grant et al (2001), 56 OR (3d) 215 (CA); Toronto-Dominion Bank v Deloite Hoskins & Sells (1991), 5 OR (3d) 417 (Gen Div). Finally, the Claim has to be taken as pleaded by the Plaintiffs, not as reconfigured by the Defendants: Arsenault, above.
[31] The Plaintiffs say that the Prothonotary correctly stated the test on a motion to strike, but wholly misapplied it by determining substantive matters that should have been left for the trial judge, striking the Claim despite acknowledging that it was a “novel” and “complex” one, and making an erroneous ruling on the application of the Charter.
[32] With respect to their constitutional claims, the Plaintiffs note that each level of government is entrusted with both the “power and the duty