Gerard Kennedy
Gerard Kennedy spoke 8 times across 1 day of testimony.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
Merci beaucoup pour votre invitation. Je m’appelle Gerard Kennedy. Mon expertise en le droit procédural est le droit administratif. And I’m deeply honoured to be speaking on the procedural rights that individuals have regarding their property and how the invocation of the Emergencies Act would have affected that. In essence, I’m going to suggest that there were indeed common-law procedural rights that individuals have concerning their property that were clearly affected by the events in February. However, because these are common-law rights, they can be overridden by regulation or legislation. So insofar as the invocation of the Act was lawful, taking away procedural rights that people have before being deprived of property was also lawful. And given that the Canadian Constitution doesn’t protect property rights, the Constitution won’t change anything in that analysis. The Canadian Bill of Rights might more plausibly have something to say, but it’s uncertain. From a policy perspective, the legality of sending these procedural rights into abeyance is probably not desirable, and insofar as this Commission has a policy role, I’ll make some recommendations. But I don’t think that affects the legality of what occurred in February. And insofar as procedural rights cannot be reconciled with the Act’s invocation, I would suggest that that is not -- that’s a reason to not give the statutory prerequisites that justify invoking the Act a broad interpretation. In other words, an interpretation more consistent with the preservation of common-law rights should be preferred. Starting with a few first principles, individuals have a right to enjoy their property. That’s been recognized for centuries. That can be limited in various ways. But generally speaking, that is adjudicated in the Courts, either because there is an action to freeze the property or because Individual A has commenced an action against Individual B asserting that their use of the property somehow impinges upon their rights. And in doing so, the rules of procedural fairness and civil procedure have got to be followed. These can look a little different in exigent circumstances, and I’ll return to that, but generally that’s the case. Moreover, before the executive branch of government deprives one of one’s property, it has to follow the rules of natural justice, or to use the modern Canadian Parliament’s procedural fairness, recognized in England for centuries, and certainly applicable in Canada. The content of this procedural fairness will vary according to the circumstances, but generally it’s always going to include notice of the proposed seizure or freezing, and some sort of opportunity to respond. I’d like to emphasize, these are procedural rights to property. It doesn't mean that one's rights to property, the property can't be seized, or frozen, or forfeited, or even destroyed. It does mean, however, that certain procedural hoops need to be jumped through before we go down that route. Moreover, the Executive Branch has no substantive power to take property unless authorised by a statute. So a statute needs to authorise the taking. So prima facie, without getting into the factual weeds, in early February 2022, the members of the convoy had these protections that processes would be followed before their property rights were taken away. However, the Emergencies Act is a statute that clearly authorises takings, and the Emergency Measures Regulations and the Economic Measures Orders make it quite clear that the procedural rights, as well as the substantive rights, were restricted in various ways, as we have already heard from my co-panelists. So to give an obvious example, entities, such as banks, had to cease making available any property for designated persons, among many other things. It made it very clear that no court order was necessary, and the entities were immune from any sort of liability for complying with the Regulations, which probably resulted in erring on the sides of more seizures. Now, I will suggest that that does not fulfill the common law purpose of notice to persuade the decision-maker that you should not be deprived of your property rights because you are not -- you should not be a designated person and there is no centralised authority to making someone a designated person. One could argue that determining individuals to be designated persons is an administrative decision and not a quasi-legislative decision, and that some sort of process should be contemplated there. Possibly, but that doesn't -- that isn't spelled out in the orders, and it's also complicated by the fact that these decisions were generally made by non-state actors, which complicates, somewhat, the applicability of administrative law. I'll come back to this shortly in the policy discussion. Now, we don't live in a country of legislative supremacy entirely. The Constitution constrains government action in various ways, and you heard this morning, and you'll hear later this week about a lot other rights that were potentially impacted by the Act's invocation where the Charter has a lot to say about matters. But property rights aren't in the Constitution. That was a deliberate choice in 1982, and it would be inappropriate to try to give them constitutional status at this stage. It doesn't mean they don't exist, but they're not constitutionalised, not even procedural protections to them, which again makes Canada a bit of an outlier around the world, but it is still very much the case of the Canadian Constitution. The Canadian Bill of Rights on the other hand does guarantee procedural rights regarding property. For instance, section 1(a) guarantees a right to enjoyment of property and the right not to be deprived thereof, except due process of law. This use of due process if fairly rare in Canadian law. It's somewhat of an American import, where we've tended to use natural justice or fundamental justice or procedural fairness. But it has significant overlap, the principles of procedural fairness. Moreover, section 2(e) of the Bill of Rights holds that statues shall not be construed to: "...deprive a person of the right to a fair hearing in accordance with the principles of fundamental justice for the determination of...rights and obligations..." Though I'll note that that doesn't guarantee a particular process, but rather, interference with processes already authorised at law, so there's nothing problematic from a Bill of Rights perspective with the mere fact that such a process was not prescribed in the orders. Moreover, the procedural protections for property have been interpreted quite narrowly only to instances where there is discretion to deprive the person of their property. So if legislation takes away the right to property unambiguously, the Bill of Rights protections are inapplicable. Moreover, the specific due process rights protected by the Bill of Rights must have existed in 1960, as the Bill of Rights is a statute to be interpreted the way it would have been after it was passed. So what does this mean about the Bill of Rights? Well, the enactment of the Regulations themselves does not pose a Bill of Rights problem because the Governor in Council enacted them in a quasi-legislative capacity. Having such a hearing before Cabinet clearly seems to have not been a right pre-1960. More plausibly, individual decisions about the particular individuals whose assets would be frozen could attract Bill of Rights due process protections because they are administrative rather than legislative acts. At the same time, while that's a plausible reading of the Bill of Rights, there is relatively little case law on it, despite it being over 60 years old. It's never been interpreted in circumstances such as this. There probably is a pre-1960 right to have notice or a hearing before property is frozen by the Executive, but does it apply the implementation of Cabinet decisions? Does it matter that this is an emergency, if not statutorily, at least colloquially? Does it matter that private entities actually did the freezing? Does it matter that these are very clear Regulations? These complicating factors make the way in which the Bill of Rights could affect things somewhat uncertain. So I'm going to transition to my policy points, and in doing so, though, I will discuss what a hearing that preserves a measure of procedural protection, whether at the Bill of Rights, or otherwise, could look like. Procedural law recognises there are exigent circumstances where property has to be frozen soon. So for instance, Anton Piller and Moreva orders in the civil litigation process allows searches of property or seizing of assets without notice if there is reason to believe that responding parties will hide assets or something similar. There has to be judicial authorisation to be sure, but there are opportunities to challenge after the fact, and there will be significant consequences if a party was not forthcoming regarding how it obtained the order. And there are other circumstances, notably in the Money Laundering and Terrorist Financing Act, that give individuals post talkability to challenge asset seizure and get a resolution quickly, addressing the concern already identified, that the freezing and lack of access to one's bank accounts can have a really profound affect on one individual's lives, while still recognising there are circumstances where it is absolutely necessary. But that was not -- such a process wasn't apparent in the Regulations, and I don't think that poses a legal problem, given the broad nature of the Act, but I do think it may be a good idea to amend the Emergencies Act to prescribe a process to review the seizure of property analogous to what is seen in the Money Laundering or Terrorist Financing Act, particularly for emergencies that -- or states of emergency that last quite sometime. Because in this case it lasted nine days, but there is nothing inherent that that's necessarily going to be the case. And I'd like to also echo Jessica Davis's view that the designation of individuals should be named, if not by the Governor in Council, by some sort of designated central authority, both in terms of making it easier to determine the applicability of administrative law principles, and to not have this kind of ad hoc situation where what kind of procedure, if any, would be necessary is very uncertain. So, so far I have suggested that there are ways that we could improve the Emergencies Act and future Orders in Council to preserve more of a protection for property rights, recognising there are exigent circumstances where property rights have to be suspended and traditional civil procedure is not going to work, but in light of that I would suggest because of the general principle of statutory interpretation to rights limiting legislation strictly, I'd encourage the Commission not to interpret the Emergencies Act broadly, given that it can deprive individuals, not just of their substantive rights to property but also any kind of procedural ability to protect it. It's a well-established principle of statutory interpretation that rights restricting legislation, including property rights restricting legislation is to be interpreted strictly. It's also a principle of statutory interpretation that legislation intends to be consistent with the common law to the extent possible. So in this case, if the Commission finds that it's a gray zone, whether the statutory prerequisites for invoking the Act were met, it should bear in mind these common law rights as a reason to not interpret it particularly broadly. That’s not determinative. This Commission should consider all canons of statutory interpretation that likely point in different directions. However, insofar as the legislation sends individuals' due process or procedural fairness rights essentially into abeyance, we should be reasonably certain that Parliament intended for it to apply in these circumstances. That’s not a condemnation that the government didn’t act proportionately here. That will be up for this Commission. I don’t see evidence that it didn’t, but given that a government is not legally obliged to do so, it should consider the long- term implications of that. Merci beaucoup.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
Yeah. No, that's really interesting, and you could definitely make an argument that for everyone who is coming, it is notice. For people who are there, it kind of is all right, it's a dispersal order that's not a dispersal order, so to speak. So it's kind of stretching the definition, I think, of notice. And it still doesn't really get around to determine whose assets get frozen. That remains a little bit of an uncertainty. And so that is where I think from a procedural fairness perspective it gets a little more complicated, unless you just view this as a quasi-legislative action and then that's notice enough.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
Je vais reprendre en anglais parce que je veux être le plus précis que possible.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
Well, is it -- okay, let’s -- in times of crisis, traditional rules of procedural fairness can be modified. We have to accept that not -- we can’t always have gold-plated process going on here. So in that sense, to some extent, a hammer is -- I’m not completely opposed to it. Where I think it becomes more problematic is, how did the banks know who’s accounts to freeze? And if they felt they made a mistake -- like, what sort of disincentive is there on the bank to not do it. How do they know the person didn’t leave? The fact that there wasn’t a centralized authority is a little bit of a problem as well here. And the fact that there was no challenge after the fact is a bit of a problem as well. Like, going only for efficaciousness, this may very well have efficacious and therefore, in some cases, I don’t have an -- I’m not going to argue that it wasn’t efficacious, or that it wasn’t even justified in particular situations. I think the problem arises, as you know -- as you’ve noted -- it was implicit in your question -- that we don’t how the banks made this decision. We don’t know if the banks did it with someone who actually got the message and left, and that’s where the lack of any individual protection is a bit problematic. And look, in an emergency, some of this is going -- someone’s going to fall through the cracks, but the lack of any kind of ability to challenge, the lack of any kind of way to say, “No, I left. I got the message,” and the bank had no incentive to accept it -- like, the person could go into their bank account in Toronto and say, “Look, I’m back,” but the bank wasn’t obliged or had no incentive to take it off, per se, that’s where I think it becomes slightly more problematic from a procedural perspective.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
Yeah, Gerard Kennedy. Just to add a little bit on that, I realize we’re outside of the terrorist financing context here, but many of the principles, I think, are analogous in terms of there are situations where you will want to freeze the account because it’s really urgent. But as Professor Gallant noted, there are circumstance where there - - it could be a joint account between someone who’s genuinely engaged in terrorist financing and a completely innocent party, which is why there’s a process to challenge that, which is why I think -- and maybe it couldn’t be exact analogous -- some sort of ability to challenge property seized under the Emergencies Act analogous to under the Terrorist Financing Act -- Money Laundering and Terrorist Financing Act is probably a good idea. And to Jessica’s point, that banks have the duty, ultimately, to do this, banks are not experienced in administrative law in the way that many aspects of the -- agents of the government are, which is why I suggest that the designation should probably be done by a centralized authority. I don’t that affects the legality of what went on in February, or even whether it was necessary, reasonable, and proportionate. It may have been all that thing, but I think it would be better policy to have it done by an entity that’s learned in admin law principles. And yes, there might be some sort of brief period where someone’s bank account is frozen unnecessarily, but I think it would mitigate it, and the incentive for the bank to do nothing is not quite the same as if there’s an emergency regulator that has precisely this purpose.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
Okay. I actually have a question that I'd like to ask my colleagues who are more substantive subject matter experts in this area for the earlier question of whether we have any questions. Many of the individuals financing the people in February may not have been here, and yet I don’t think they fall within the definition of designated persons whose assets were frozen. So -- and they may have been the people who actually may have been most efficacious to freeze the bank accounts up. And does that affect your opinion about what policy should be, going forward, how proportional things were of that nature?
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Gerard Kennedy, Prof. (Law – University of Manitoba)
And just to build on that, I think that may be an argument that the measures were proportionate on the facts of what occurred in February, while also recognizing that insofar as this Commission has a policy rule and is recommending how to make sure that these more profound consequences are mitigated in the future, depending on whether or not it believes the threshold for invoking the Act was met, there are recommendations that could be made to mitigate those concerns.
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Gerard Kennedy, Prof. (Law – University of Manitoba)
I just think that goes back to a point I made earlier, that insofar as individuals’ property rights were limited in this situation. The prerequisites to do so should not be interpreted broadly when there’s genuine ambiguity about that. And I just think this underscores that, because of the reasons is that limiting individual’s rights, even when we understand it’s for a problem that’s really got to be resolved, is going to have unintended negative consequences, and we don’t want to have those unintended negative consequences unless we’re sure they were quasi-intended negative consequences. And I also think this underscores what I said earlier, that it may be best that the bank is not making the decision on whose assets to freeze, because then individuals stop trusting the bank as a bank, and banks may not be the most sympathetic entities in our society, but they play a very key role, and they’re very risk adverse. Like, whenever I teach certain discovery rules, it’s always the bank that has to be told exactly what it’s going to do. It wants a court order, because it’s going to avoid liability at all costs. So having the bank not make the decision is probably, in this exceptional circumstance, where the bank is -- has to freeze your assets, because occasionally we’ll have to, I think it shouldn’t be the entity that’s applying its discretion as to whether or not to do that, because it’s going to avoid liability at all costs.