Her Majesty the Queen v. . 100193 P.E.I. Inc. et al.

In Fish Cases, Fisheries Practice, Judicial Review/Crown Liability on (Updated )

This was an appeal and cross appeal from a decision of the Federal Court (2015 FC 932) allowing in part the Appellant/Defendant’s motion for summary judgement to dismiss the Respondent/Plaintiffs’ claims. In their action, the Plaintiffs’ claim included the following:

1) Expropriation without compensation;
2) Breach of contract;
3) Unjust enrichment; and
4) Misfeasance of Public office.

The motions Court granted summary judgement dismissing the claim for breach of contract and unjust enrichment. It then dismissed the remainder of the application allowing the claims for unjust enrichment, expropriation without compensation and misfeasance to go to trial.
Some of the background to this case is described in the case of Arsenault v. Canada, 2008 FC 299 (digested on this webpage). The Plaintiffs were a group of approximately 30 snow crab fish harvesters residing in Prince Edward Island. They were licenced to fish in area 12 in the early 1990’s and were referred to as “traditional inshore fishermen”. They had some conflicts with a group of 130 “traditional mid-shore fishermen” from outside P.E.I. who were licenced to fish in areas 25 and 26. In 1993 the competitive shotgun type fishery for snow crab was replaced by an individual quota system. It was alleged by the Plaintiffs that at that time that they agreed to give up the competitive fishery, they also agreed to finance some research and conservation measures.

In 1997, the inshore fish harvesters were integrated into areas 25 and 26 with the mid-shore fish harvesters and agreed to a five-year management plan that involved them making significant contributions of funds for Department of Fisheries (“DFO”) management activities.
After the Marshall decision in 1999, DFO purchased two snow crab licences from two members of the inshore fishery pursuant to a government funded “buy back” program.
In 2003 DFO approved a three-year management plan which was the source of the Plaintiff’s complaints. They alleged that the plan reduced the Plaintiff’s share of the total allowable catch (“TAC”) in the following three ways: (a) integrating the inshore fishers into areas 25 and 26; (b) allocating 15.8% of the TAC to First Nations when only 5% of the TAC was freed up by the buy back; and (c) reserving an additional 15% of the TAC for new entrants. An additional complaint arose from DFO’s setting aside part of the snow crab resource between 2003 and 2006 to finance research activities. This practice was declared illegal by the Laroque decision in 2006 (2006 FCA 237.

Upon appeal, the Court of Appeal held that:

1) The Plaintiffs’ claims based upon expropriation without compensation and unjust enrichment should have also been dismissed by summary judgement;
2)The cross appeal was dismissed;and
3)The claim for misfeasance was allowed to continue to trial.

With respect to the claim for expropriation without compensation, the court held there was no genuine issue to go to trial because at law the case could not succeed. The court said that:

The law does not recognize a proprietary interest on the part of fishers in uncaught fish or the fishery, nor does the law recognize a right to compensation for a reduction in quota: Kimoto v. Canada (Attorney General), 2011 FCA 291 (CanLII), 426 N.R. 69

The Court also declined to follow a previous trial court decision of the Federal Court that declined to dismiss an expropriation without compensation case on summary judgement.

With respect to the unjust enrichment claim, given the Court of Appeal’s finding that there was no expropriation without compensation, the Court held that there could be no unjust enrichment because the Plaintiffs did not suffer a deprivation.

With respect to the misfeasance claim, the Court adopted the following test from Odhavji Estate v. Woodhouse, 2003 SCC 69:

"[T]he tort of misfeasance in public office is an intentional tort whose distinguishing elements are twofold: (i) deliberate unlawful conduct in the exercise of public functions; and (ii) awareness that the conduct is unlawful and likely to injure the plaintiff. Alongside deliberate unlawful conduct and the requisite knowledge, a plaintiff must also prove the other requirements common to all torts. More specifically, the plaintiff must prove that the tortious conduct was the legal cause of his or her injuries, and that the injuries suffered are compensable in tort law."

In allowing the misfeasance claim to continue to trial, the court noted that “the existence of a proprietary interest forms no part of the elements of the tort and that damages for the tort can legally embrace economic matters beyond proprietary interests (para 26)". In allowing this claim to proceed to trial the court limited the claim to DFO using the TAC to finance its activities and obligations it believed it had towards other groups of fish harvesters.

With respect to the counterclaim, the Court of Appeal upheld the Trial Court’s finding that the Plaintiffs did not produce evidence to support a finding that there was a contract that the TAC would only be freed upon for First Nations out of buy back quota. The Court found that the Minister’s statement only amounted to statements of policy objectives.

The Court of Appeal closed by commenting on the palpable and overriding error test as follows:

"One must keep front of mind that palpable and overriding error is a high standard: “[w]hen arguing palpable and overriding error, it is not enough to pull at leaves and branches and leave the tree standing,” but rather “[t]he entire tree must fall.” See Benhaim v. St Germain, 2016 SCC 48 (CanLII) at para. 38, citing Canada v. South Yukon Forest Corporation"