Federal Court Decisions

     T-2078-96

    

BETWEEN:

     KENNETH JAMES PAUL,

     Plaintiff,

     - and -

     CHIEF AND COUNCIL OF KINGSCLEAR INDIAN BAND,

     THE KINGSCLEAR INDIAN BAND,

     HER MAJESTY THE QUEEN IN RIGHT OF CANADA AS

     REPRESENTED BY THE MINISTER OF INDIAN AND

NORTHERN AFFAIRS and CYNTHIA LORRAINE PAUL,

     Defendants.

     REASONS FOR ORDER

LUTFY J.:

     The defendants, other than Her Majesty the Queen in Right of Canada ("the Crown"), have moved to stay this action on the ground of the lack of jurisdiction of the Federal Court of Canada.

     The plaintiff and the defendant Cynthia Lorraine Paul ("the defendant Paul") were married in September 1980. On July 16, 1985, pursuant to section 20 of the Indian Act,¹ the couple obtained a certificate of possession as joint tenants with respect to a certain piece of land within the Kingsclear Indian Reserve. The parties constructed their family residence on this lot.

     In August 1992, the couple separated and was divorced in the summer of 1995. The defendant Paul has been living in the family residence with another person since 1993. The plaintiff acknowledges that the divorce has not affected the certificate of possession. However, in fact, he no longer enjoys physical access to the family residence.

     The plaintiff is seeking compensation for his contribution towards the construction costs of the family residence. In this action, he claims:

(a)      An Order in the nature of mandamus directing the Minister of Indian Affairs and Northern Development to perform his public duty and pay to the Plaintiff compensation for the improvements made by him to Lot 145 of the Kingsclear Indian Reserve;

(b)      A declaration that the Plaintiff has made improvements to Lot 145 of the Kingsclear Indian Reserve;

(c)      An injunction preventing continued occupation of the residence located on Lot 145 of the Kingsclear Indian Reserve by the Defendant, Cynthia Lorraine Paul;

(d)      In the alternative an Order for mandamus compelling the Defendants to consult with the Plaintiff and to negotiate with the Plaintiff to settle the terms of compensation for the alienation of reserve lands from the Plaintiff;

(e)      In the further alternative and based upon the rental incomes available on the Kingsclear Indian Band Reserve, half of the annual rental income since August 10, 1992 to calculate the Plaintiff's life-interest in the property and payable to the Plaintiff by the Defendants;

(f)      Damages for pain and suffering to the Plaintiff in the amount of $100,000.00 of such further or other sums as may be determined at trial;

(g)      Punitive damages;

     (h)      Interest on all monies from August 10, 1992;

     The defendants in this action are: (a) the Chief and Council of the Kingsclear Indian Band ("the defendant Council") and the Kingsclear Indian Band ("the defendant Band"); (b) the Crown; and (c) the defendant Paul. The plaintiff and the defendant Paul, a non-native, are on the Band List of the defendant Band.

     This Court's jurisdiction with respect to the Crown in this action is not in issue. The other defendants, however, challenge the jurisdiction of this Court and seek a stay of the action pursuant to section 50 of the Act.

     For this Court to have jurisdiction with respect to the moving parties: (a) there must be a statutory grant of jurisdiction by the federal parliament; (b) there must be an existing body of federal law which is essential to the disposition of the case and which nourishes the statutory grant of jurisdiction; and (c) the law on which the case is based must be "a law of Canada" as the phrase is used in section 101 of the Constitution Act, 1867.²

     The parties acknowledge that the only federal statute which may provide a statutory grant of jurisdiction in this action is the Act. Subsections 17(1) and (4) state:

(1)      Except as otherwise provided in this Act or any other Act of Parliament, the Trial Division has concurrent original jurisdiction in all cases where relief is claimed against the Crown.

     ...

(4)      The Trial Division has concurrent original jurisdiction to hear and determine proceedings to determine disputes where the Crown is or may be under an obligation, in respect of which there are or may be conflicting claims.

     Subsection 17(1) of the Act establishes this Court's statutory grant of jurisdiction with respect to the Crown. The plaintiff's cause of action against the Crown and the other defendants is "intertwined" in the sense that the relief sought against each is based on the same set of facts. Even so, the statutory grant of jurisdiction in subsection 17(1) is limited to the Crown and cannot extend to subjects.³

     Subsection 17(4) can apply to cases where there are competing claims to an obligation owed by the federal Crown. The provision requires (a) a proceeding, (b) to determine a dispute, (c) where the Crown is or may be under an obligation, (d) in respect of which there are or may be conflicting claims.⁴

     This action is a proceeding to determine a dispute in relation to the compensation the plaintiff alleges he is owed for the permanent improvements made on the land which is the subject matter of the certificate of possession. In my view, the first two requirements for subsection 17(4) are met.

     In setting out the legal basis for the compensation, the Statement of Claim alleges in part:

14.      The Plaintiff has made repeated attempts to obtain possession of or compensation for his interest in the home from the Defendant, Chief and Council of the Kingsclear Indian Band (hereinafter "Chief and Council").

15.      The Plaintiff has made repeated attempts to obtain possession of or compensation for his interest in the home from the Defendant, Her Majesty the Queen in Right of Canada as Represented by the Minister of Indian and Northern Affairs (hereinafter "the Queen).

16.      The Plaintiff relies upon the provisions of Section 23 of The Indian Act, R.S.C. 1970, c. I-6 which reads as follows: "An Indian who is lawfully removed from lands in a reserve upon which he has made permanent improvements may, if the Minister so directs, be paid compensation in respect thereof in an amount to be determined by the Minister, either from the person who goes into possession or from the funds of the band, at the discretion of the Minister.

     ...

21.      The Defendant, the Queen, has breached its fiduciary duty to the Plaintiff in acquiescing to the actions of the Defendant Chief and Council in excluding the Plaintiff from compensation for the lands in his possession.

     The plaintiff cannot, "merely by baldly asserting" rights, attract the jurisdiction of this Court.⁵ The issue is whether the plaintiff has set out a cause of action that the Crown is or may be under an obligation in respect of which there are or may be conflicting claims. In this case, the record discloses more, if only somewhat more, than bald assertions.

     The plaintiff acknowledges his certificate of possession as joint tenant with his former spouse, the defendant Paul. However, he has been unable "to obtain possession of or compensation for his interest in the home." He alleges that repeated attempts to obtain redress from the Crown and the defendant Council have failed. The parties acknowledge that the plaintiff was also unable to obtain redress in the divorce proceedings.⁶

     The plaintiff relies on section 23 of the Indian Act and what he alleges to be the Crown's breach of its fiduciary obligation by acquiescing to his physical exclusion to the family residence and his inability to obtain financial compensation. The Crown's fiduciary obligation in respect of lands held for Indians was set out in Guerin v. Canada.⁷ It is difficult, if at all possible in a case such as this one, to assess the merits of a claim of the Crown's fiduciary obligation on a motion to stay. The facts in Jones Estate v. Louis et al.⁸ are not dissimilar from those in this case. Two subjects were claiming conflicting rights to possessory title in reserve land. In relying on Roberts,⁹ Mr. Justice MacKay concluded that jurisdiction existed pursuant to subsection 17(4) and stated:

That jurisdiction I find exists by virtue of s. 17(4) of the Federal Court Act, which confers concurrent original jurisdiction on the Trial Division "to hear and determine disputes where the Crown is or may be under an obligation, in respect of which there are or may be conflicting claims". Here that obligation arises in relation to Indian people and under the Indian Act, with regard to the management of Indian lands. The obligation here concerns approval of possessory title to certain of those lands, to which there are conflicting claims by the parties.10

     The sole issue in this motion is one of jurisdiction. I need not decide whether the plaintiff will succeed in asserting either section 23 of the Indian Act or the Crown's fiduciary obligation. The Crown "is or may be under an obligation" concerning the plaintiff's assertion of his rights pursuant to the certificate of possession in respect of which he and the defendant Paul, if not others, may have conflicting claims. The plaintiff, for example, is seeking injunctive relief against the defendant Paul to prohibit her continued occupation of the family residence. Accordingly, the third and fourth requirements for subsection 17(4) are also met. This provision properly constitutes the statutory grant of jurisdiction in this action.

     The provisions of the Indian Act, the common law of aboriginal title which underlies the fiduciary obligations of the Crown and subsection 91(24) of the Constitution Act, 1867 together meet the second and third criteria of the ITO-International Terminal Operators Ltd. test.¹¹

     In my view, therefore, this Court has the jurisdiction to entertain the plaintiff's action. This does not mean that the Statement of Claim, as presently drafted, is free from difficulty. Counsel for the defendant Council stated that, in her view, at least part of the relief sought against her client may only be obtained on an application for judicial review in accordance with the provisions of subsection 18(3) of the Act. Similarly, counsel for the Crown questioned aspects of the relief sought against her client. There may be other procedural and summary challenges to the Statement of Claim. These issues, however, are not to be adjudicated on motions for a stay pursuant to section 50 of the Act.

     For these reasons, the motions of the defendant Paul and the defendant Council seeking a stay of this action on the ground of lack of jurisdiction will be dismissed. Costs will be in the cause.

                                                                         "Allan Lutfy"

                             Judge

Ottawa, Ontario

May 28, 1997

    

__________________

¹      R.S.C. 1985 c. I-5.

²      See ITO-International Terminal Operators Ltd. v. Miida Electronics Inc., [1986] 1 S.C.R. 752 at 766.

³      Roberts v. Canada, [1989] 1 S.C.R. 322 at 334. See also the reasons of Mr. Justice Hugessen in Varnam v. Canada (Minister of National Health and Welfare), [1988] 2 F.C. 454 (F.C.A.) at 462.

⁴      Roberts, ibid., at 335, confirming the reasons of Mr. Justice Hugessen in the Court of Appeal, [1987] 2 F.C. 535 at 543-544.

⁵      Pacific Western Airlines Ltd. v. The Queen, [1979] 2 F.C. 476 (F.C.T.D.) at 486, affirmed, [1980] 1 F.C. 86 (F.C.A.).

⁶      In two cases from British Columbia, the Supreme Court of Canada considered the paramountcy of federal legislation concerning reserve lands in the context of provincial matrimonial property legislation: Derrickson v. Derrickson, [1986] 1 S.C.R. 285 and Paul v. Paul, [1986] 1 S.C.R. 306. In the divorce proceeding which considered the possession of or compensation for the family residence in the present case, the trial judge quoted from the argument of counsel for the defendant Paul: "If the court cannot make an order affecting ownership or possession, how can a court order compensation, when in return therefor it cannot grant the ownership or possession of the property? The matter of the home can only be solved internally on the reserve by the band council". See Paul v. Paul, F.D.F. 717-94, October 3, 1995, (N.B.Q.B.) at page 10. The defendant Paul succeeded on this issue in the divorce proceeding and argues res judicata in this Court. This is not a relevant issue in the adjudication of jurisdiction.

⁷      [1984] 2 S.C.R. 335.

⁸      (1996), 108 F.T.R. 81.

⁹      Supra, note 4.

¹⁰      Supra, note 9 at 92-93.

¹¹      Supra, note 3.