Ten years into the city's lawsuit against the Federal Government on the Red Hill Valley Parkway, we must ask whether and how this serves the public interest.
By Don McLean
Published November 25, 2013
The Red Hill Valley Parkway opened in 2007 after decades of controversy and protest. First proposed in 1954, this municipal expressway through the Red Hill River valley has faced strong opposition from the beginning, both locally from environmental, social justice and First Nations activists and, at various times, from the Provincial and Federal governments.
In 2004, the City of Hamilton initiated a lawsuit against the Federal Government, alleging that four cabinet ministers and more than 40 federal employees had conspired to knowingly harm Hamilton by intentionally delaying the Red Hill Parkway project by initiating an environmental assessment in 1998.
The City's $75 million lawsuit against the Federal Government is now into its tenth year, with court costs for the city currently well over $2 million. The lawsuit was approved in November 2004 by an 8-7 vote after an extensive presentation by the outside law firm representing the city in the lawsuit.
In March 2008, Council debated and voted 10-6 to continue the lawsuit - and also to stop releasing information about its cost to the public.
The following questions appear to need answers.
The city is represented in the case by an outside legal firm (Gowlings).
The court decision on the preliminary motions was issued two years ago (December 1, 2011). It dismisses and is very critical of the city's motions.
The preliminary motions examined in the December 1 2011 judgment occupied nine court days and took 3.5 years to reach a conclusion. They thus represent a very extensive utilization of legal resources by the city's outside counsel resulting in a substantial cost. The federal side sought a cost award. Three months elapsed after the decision dismissing the city's preliminary motions was delivered on December 1 2011 and prior to the subsequent court decision on a cost award on February 29 2012.
The cost award judgment was delivered on February 29 2012. It forced the city to pay $309,844.59 requested by the federal lawyers (p19). It states: "In the result, all of the orders sought by the City were rejected. This offer was substantially more generous to the City than the result." (p14) It determined that a fair calculation of these costs was $446,662.00 (p12). It noted that the city's outside counsel had not revealed its costs, but agreed with the federal lawyers that that amount was very likely higher than what the federal lawyers had spent. (p19)
The judge's decision was very damning: "Counsel for the City has acted as if it had a client with inexhaustible resources to finance endless experimental litigation and that it could conduct litigation against the federal government with impunity." (p17)
The judge also quoted and fully endorsed the view expressed by the federal lawyers: "This motion proved to be entirely unnecessary. Over 3-1/2 years were spent in preparation and argument. It consumed 11 court days ostensibly to determine what portions of a 183-paragraph decision by Justice Dawson of the Federal Court were res judicata, based on a hearing in the Federal Court which itself required only 5 days. The City was entirely unsuccessful. No findings were made by the court that the defendants had not already conceded or admitted in their statement of defence filed in 2006. In the end, 3-1/2 years of legal work by both parties, which could have been spent advancing the action, were entirely wasted." (p18)
When did the outside legal counsel report the cost award decision to the city? If this decision was not reported to council, why not? Is this not a fundamental responsibility of the outside counsel?
This is an unexpected expenditure of over $300,000. When was the cost award decision reported to city council? Why was it not made public by the city?
Who reviewed this decision on behalf of the city and what were their conclusions? When were those conclusions reported to council?
The cost award decision was very critical of the fairness of the substance of the city's preliminary motion: "The City was asking for something in this motion that is contrary to fundamental fairness and the system of justice in this country." (p16) This is damning to the reputation of the City of Hamilton.
The decision also set out in some detail the hurdle that must be crossed for the city to succeed in its overall case. It appears to be a very high bar. City decision makers, including city councillors, need to be aware of this challenge. The judge stated: "To prove misfeasance against a public official a plaintiff must prove that the public official deliberately engaged in unlawful conduct in the exercise of public functions, he/she was aware that the conduct was unlawful and likely to injure the plaintiff, the public official's tortuous conduct was the legal cause the plaintiff's injuries and the injuries suffered are compensable in law." (p14-15)
The judge cited a precedent case to further explain the hurdle: "At its core, the tort targets officials who act dishonestly or in bad faith. As Iacobucci J. said in Odhavji, public officials who deliberately engage in conduct that they know to be inconsistent with the obligations of their office risk liability for the tort. Conversely, public officials who honestly believe their acts are lawful, and do not intend to cause harm or know that harm would likely result from their actions, fall outside the ambit of misfeasance in public office. In this way, the required mental element achieves a balance between curbing unlawful, dishonest behavior and enabling public officials to do their jobs free from claims by those adversely affected by their decisions." (p15)
Were city councillors aware that this is the challenge faced by the city in its lawsuit? If not, why not? If so, do they honestly believe this has a reasonable chance of success?
For over nine years, more than 40 civil servants have lived under the cloud of these accusations by the city and its councillors. Do councillors feel this is fair and reasonable treatment for government employees? How would they feel if the shoe were on the other foot and it was city staff facing these very serious allegations?
The city's costs now appear to exceed $2 million. The federal side has also incurred substantial costs (nearly $700,000 confirmed four years ago). These costs are all being borne by taxpayers. All of the city's costs are borne by local taxpayers and a portion of the federal costs are also borne by taxpayers. If the city is successful in its lawsuit, further costs will be imposed on Canadian taxpayers. All of the cost of this lawsuit will be borne by taxpayers.
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