The Supreme Court of Canada held that the Canadian Human Rights Tribunal does not have the power to award legal costs as part of a compensation order

Administrative law – Decisions of administrative tribunals – Human Rights Tribunal – Human rights complaints – Discrimination – Gender – Judicial review – Standard of review – Reasonableness simpliciter – Compliance with legislation – Administrative tribunals – Costs – Right to award costs

Canada (Canadian Human Rights Commission) v. Canada (Attorney General), [2011] S.C.J. No. 53, Supreme Court of Canada, October 28, 2011, McLachlin C.J and Lebel, Deschamps, Abella, Charron, Rothstein and Cromwell JJ.

The appellant had a fourteen-year career as a traffic technician before the Canadian Forces compulsorily released her. Three years after leaving the Canadian Forces, the applicant filed a complaint with the Canadian Human Rights Commission alleging sexual harassment, adverse differential treatment and failure to continue to employ her on account of her sex, pursuant to ss. 7 and 14 of the Canadian Human Rights Act (the “Act”). The matter was heard before the Canadian Human Rights Tribunal and the Tribunal concluded that the complaint was substantiated in part. The Tribunal awarded her $4,000, plus interest, to compensate the appellant for “suffering in respect of feelings or self-respect”. Further submissions were made with respect to whether the Act includes the authority to award legal costs. The Tribunal reviewed the conflicting Federal Court jurisprudence and policy considerations and awarded the appellant $47,000 legal costs.

The Attorney General of Canada applied for judicial review; the Federal Court of Canada held that the Tribunal’s decision about its authority to award costs was reasonable but the Federal Court of Appeal held that the Tribunal had no authority to make a costs award. The appellant, and the Canadian Human Rights Commission, appealed the decision to the Supreme Court of Canada.

The main question before the Court was whether the Tribunal made a reviewable error in deciding that its power to compensate a victim for, inter alia, “any expenses incurred by the victim as a result of the discriminatory practice” pursuant to s. 53(2) of the Act permits it to order payment of all or a portion of the victim’s legal costs.

The Supreme Court of Canada found that the proper standard of review of the Tribunal’s decision is reasonableness. The Court held that the question of costs was one of law, located within the core function and expertise of the Tribunal and which relates to the interpretation and the application and its enabling statute. Regarding the reasonableness of the Tribunal’s decision, the Court held that it was clear that the words of s. 52(2) of the Act, when read in their statutory context, could not reasonably be interpreted as creating  a stand-alone category of compensation capable of supporting any type of disbursement causally connected to the discrimination. The term “costs” has a distinct legal meaning, distinct from either compensation or expenses and thus the Court reasoned that had Parliament intended to confer authority to order costs, it would have used this very familiar and widely used term of art to implement that purpose. The Court concluded that “In our view, the text, context, and purpose of the legislation clearly show that there is no authority in the Tribunal to award legal costs and that there is no other reasonable interpretation of the relevant provisions. Faced with a difficult point of statutory interpretation and conflicting judicial authority, the Tribunal adopted a dictionary meaning of ‘expenses’ and articulated what it considered to be a beneficial policy outcome rather than engage in an interpretative process taking account of the text, context and purpose of the provisions in issue. In our respectful view, this led the Tribunal to adopt an unreasonable interpretation of the provisions.”

To stay current with the new case law and emerging legal issues in this area, subscribe here.