The ruling paves the way for a federal court to review a 2021 ethics finding on Justin Trudeau
Section 66 of the Conflict of Interest Act, which prevents courts from reviewing findings by Parliament’s ethics commissioner except in limited circumstances, is unconstitutional and therefore of no force or effect, the Supreme Court of Canada ruled in a unanimous decision Thursday.
The Democracy Watch v. Canada ruling paves the way for advocacy organization Democracy Watch to challenge a 2021 finding by the Conflict of Interest and Ethics Commissioner, who determined that former Prime Minister Justin Trudeau had not engaged in a conflict of interest when he approved a program administered by a charity that he and his former spouse had been involved with.
The case will now return to the Federal Court of Appeal.
“Under the rule of law, all public powers must be legal, and all legal powers have limits,” SCC Chief Justice Richard Wagner wrote in Thursday’s decision. “These limits are set out in the delegating statute, in the common or civil law, or derived from the Constitution itself.
“An unlimited power is, definitionally, not a legal power,” Wagner added.
Paul Daly, a research chair in the University of Ottawa’s Faculty of Law who represented Democracy Watch, called the high court’s ruling a landmark decision “that will be read decades from now.”
“This decision applies to all government bodies everywhere in Canada,” Daly told Canadian Lawyer. “It means that anytime a decision maker – be it a federal cabinet, provincial cabinet, a minister, civil servant, regulator – makes a decision that impacts your rights, privileges, or interests, you can go to court and contest that decision, and no law can shield government decision makers from court oversight about how they exercise their powers.”
Sujit Choudhry of Circle Barristers, who also represented the advocacy organization, said the high court’s ruling renders privative clauses – legal provisions that purport to prevent courts from reviewing the findings of administrative decision makers – unconstitutional when they interfere with the courts' constitutional duty "to rule on the legality of executive power."
“In an era where executives around the world have sought to assert broad and unlimited powers that are not reviewable by the courts, the Supreme Court of Canada has resoundingly proclaimed that will not occur in Canada,” Choudhry said.
The issues in Democracy Watch v. Canada date back to the COVID-19 pandemic, when the federal government launched a program to create jobs for post-secondary students. The civil servants who designed the program recommended that WE Charity, a development charity, administer it.
Trudeau initially pulled the program off the Cabinet agenda when he learned about WE Charity’s involvement. Sophie Grégoire Trudeau, his then-spouse, had been an honorary ambassador for the charity. The couple had also participated in numerous WE Charity events. However, the program returned to the Cabinet agenda after the designers argued that only WE Charity could implement it according to the proposed timeline. Trudeau and the Cabinet approved the plan.
Two Members of Parliament argued that Trudeau should have recused himself from the decision-making process and asked the ethics commissioner to investigate. In May 2021, the commissioner concluded that Trudeau had not violated the Conflict of Interest Act, which aims to prevent conflicts of interest by the prime minister and other senior federal public office holders.
Democracy Watch challenged the commissioner’s findings at the Federal Court of Appeal. However, a panel of the appellate court ruled unanimously that s. 66 of COIA, known as the ouster clause, barred the court from intervening in the dispute.
Section 66 provides that “every order and decision of the [ethics] commissioner is final and shall not be questioned or reviewed in any court,” except in limited circumstances. These include when the court is satisfied that the decision-making body that issued the order acted beyond its jurisdiction, failed to observe procedural fairness, erred in law, engaged in fraud, or otherwise broke the law.
Democracy Watch appealed to the SCC, arguing that COIA “does not preclude judicial review at all.” The advocacy group added that if COIA does prevent Canada’s courts from reviewing the ethics commissioner’s decision, “it would be unconstitutional, since it would empower the commissioner to determine the limits of his own jurisdiction.”
In Thursday’s decision, Wagner determined that “every exercise of public authority is subject to the courts’ supervisory jurisdiction to ensure that it does not exceed its legal limits.”
Read in its historical context, Canada’s jurisprudence “is clear that the Constitution guarantees the availability of legality review of all aspects of an administrative decision,” Wagner wrote. “S. 66 of the COIA infringes this guarantee by purporting to bar judicial review on questions of fact and law: to that extent, it is of no force and effect.”
The chief justice explained that when courts are determining whether to consider an application for judicial review, they need to examine the alternative forums available to applicants seeking a second opinion. While alternative remedies do not need to be the same as those available via the courts, they need to be capable of adequately addressing an applicant’s concerns.
In circumstances where an applicant has access to an appropriate alternative venue, courts can decline to review their application. Wagner said this was not the case here.
“There is nothing in the COIA that provides interested parties like Democracy Watch with an alternative forum in which to seek the remedy available on judicial review: consideration of the legality of the commissioner’s report,” Wagner said.
He noted that the COIA “provides explicitly that [the commissioner’s] conclusions [about Trudeau] cannot be changed by anyone. Unless the commissioner’s decision is quashed following judicial review, his conclusions cannot be altered.”
Wagner added that when a privative clause interferes with the courts’ authority to “review the legality of an exercise of delegated power,” which is guaranteed by the Constitution Act, 1867, it is unconstitutional.
Jeremy Opolsky, a partner at Torys LLP who represented one of the intervenors in the case, the Canadian Constitutional Law Initiative of the University of Ottawa Faculty of Law, says Thursday's decision tackled an administrative law question that has been unresolved since the high court's landmark ruling in Canada (Minister of Citizenship and Immigration) v. Vavilov.
In an earlier SCC decision from 1981, Crevier v. Attorney General of Quebec, the high court ruled that privative clauses cannot prevent courts from reviewing administrative decision makers on questions of jurisdiction. However, the court found that privative clauses can, when properly framed, stop courts from reviewing questions of law and other issues unrelated to jurisdiction.
Fast forward to Vavilov, in which the SCC said it was "not going to treat true questions of jurisdiction as in and of themselves a different category of judicial review," Opolsky says. "So there were these open questions as to what we would do with judicial review of privative clauses post-Vavilov."
"We were really waiting to see what the court would do to create clarity on this question... What do we do with judicial reviews that the legislature expressly wants to get rid of, or prevent, or oust, or block, given ... the different strands of the law that we've had post-Vavilov?" Opolsky says. "The court here is quite clear as to the pre-eminence of the rule of law, and that review for legality, which is what the chief justice calls it, cannot be ousted by the legislature."
The lawyer added that Thursday's ruling in Democracy Watch v. Canada is "one of the most important administrative law decisions post-Vavilov in this court."
The Attorney General of Canada did not immediately respond to a request for comment.
