Anderson v Alberta (AG), 2020 ABCA 238

Applications to admit fresh evidence allowed. The advance costs order was based on an error of law in applying the legal test to the facts regarding Beaver Lake Cree Nation’s award for funding an underlying claim. Given the resources available to the First Nation, the award was unreasonable and is set aside.

Indigenous Law Centre CaseWatch Blog

In these two appeals the Government of Canada and the Government of Alberta appeal an order requiring them each to contribute $300,000 a year to the plaintiffs to fund underlying litigation (Anderson v Alberta (AG), 2019 ABQB 746). Beaver Lake Cree Nation [“BLCN”] has about 1,200 members, and is a signatory to Treaty 6. The underlying claim is lengthy and nuanced, but the essence of the claim is that the Crown appellants have improperly allowed lands traditionally used by BLCN to be “taken up” for industrial and resource development. Declarations of rights, injunctions and damages are claimed.

The original statement of claim was issued in 2008. Since that time there have been various interlocutory steps taken in preparation for trial, such as closing the pleadings and some disclosure of documents. Questioning has not yet started but BLCN has spent approximately $3 million on legal fees to date, about one-half from its own funds, and presently pays $25,000 in fees per month ($300,000 per year). The 120 day trial is presently scheduled for January 2024.

The 2017 annual financial review by Indigenous Services Canada concluded that there are no concerns in regard to the financial health of BLCN. The case management judge did note that BLCN has operated in a surplus position in the last few years, and that its financial situation is improving. The test for advance funding was quoted at length from the leading cases (British Columbia (Minister of Forests) v Okanagan Indian Band, 2003 SCC 71 [“Okanagan”]; Little Sisters Book and Art Emporium v Canada (Commissioner of Customs and Revenue), 2007 SCC 2, [“Little Sisters”]). It was concluded that BLCN had sufficient resources to fund the litigation, but was entitled to allocate it to other community priorities. While acknowledging the extraordinary nature of an advance costs order, the case management judge directed that each of the appellants contribute per year towards the costs of the litigation, with BLCN continuing to pay a like amount.

The test for ordering a defendant to fund public litigation against it through an advance costs order was set in Okanagan: 1) the party seeking interim costs genuinely cannot afford to pay for the litigation, and no other realistic option exists for bringing the issues to trial; 2) the claim to be adjudicated is prima facie meritorious; and 3) the issues raised transcend the individual interests of the particular litigant, are of public importance, and have not been resolved in previous cases (Okanagan; Little Sisters). In this appeal, the appellants only argue that the respondents have failed to meet the “impecuniosity” branch of the test. The test is that the applicant must be impecunious (Okanagan).

BLCN created the Beaver Lake Cree Nation Heritage Trust in 2014, after this litigation was well underway. It now argues that there are “strict restrictions” on these funds. A plaintiff cannot voluntarily tie up its assets in a trust, and then argue it is impecunious and in need of litigation funding. The limits on how much can be taken out every year were self-imposed, and could be changed. BLCN also has access to other funds, subject to a request or approval. A plaintiff cannot fail to seek access to its own assets, and then argue it is impecunious (Little Sisters). It was an error of principle to disregard these assets in the analysis.

The finding that “more than $3 million is available” demonstrates that the order should not have been granted, based on the record as it then existed. If circumstances have changed to the extent that BLCN has now become entitled to advance costs, it is incumbent on it to reapply. The presumption is still that public interest litigation must be funded by those advancing it.