Summary
On July 26, 2024, the Supreme Court of Canada ("SCC") released its decision in Ontario (Attorney General) v. Restoule, 2024 SCC 27, concluding that the Crown breached the Robinson-Superior and Robinson-Huron Treaties (collectively, the "Robinson Treaties") by failing to increase the annuity payments owed to Indigenous beneficiaries. The SCC found the Crown was required to diligently implement its treaty obligations and increase annuities payments to the beneficiaries of the Robinson Treaties. Writing for the unanimous Court, Justice Jamal found the claim was not statute barred, and provided guidance on the Crown's duty to act honourably in their relations with Indigenous peoples.
Background
In 1850, the Anishinaabe who live on the northern shores of Lake Huron and Lake Superior ceded more than 100,000 square kilometres of lands to the Crown by entering the Robinson-Superior Treaty and the Robinson-Huron Treaty. This surrender was in exchange for rights to hunt and fish throughout the treaty territory, and annuity payments in perpetuity, among other things. The Robinson Treaties expressly provide for increasing the annuity if the Crown is able to do so without incurring loss (the "Augmentation Clause"). In 1875, the Crown increased the annuity, and has made no further increases since, resulting in annuity payments to the Indigenous beneficiaries being frozen at $4 per person for almost 150 years.
In 2001 and in 2014, the beneficiaries of the Robinson-Superior and Robinson-Huron Treaties, respectively, commenced claims alleging that the Crown was in breach of the Augmentation Clause by failing to adjust the annuities.
Lower Court Decisions
The two claims were heard together in three stages: the first stage involved the interpretation of the Robinson Treaties and whether there was a breach ("Stage One"); the second stage considered whether the defences of Crown immunity and limitations barred relief ("Stage Two"); and the third stage was aimed at the remaining issues, including damages and the allocation of liability between Canada and Ontario ("Stage Three").
Both the Ontario Superior Court of Justice and the Ontario Court of Appeal decided Stage One and Stage Two in favour of the Indigenous beneficiaries. The Ontario Court of Appeal decision was split 3-2 and included four sets of reasons and a strong dissenting opinion. Ontario and Canada appealed to the SCC and were granted leave in June 2022.
In June 2023, after the Stage Three hearing had commenced, the beneficiaries of the Robinson-Huron Treaty reached a settlement with Canada and Ontario for $10 billion for past breaches of the Augmentation Clause. The Robinson-Superior Treaty beneficiaries have not reached a settlement, and claim $126 billion in compensation. In November 2023, the SCC ordered that Stage Three be stayed until it released its decision on the appeal of Stage One and Stage Two.
The Supreme Court of Canada Decision
The SCC unanimously concluded the Crown breached the Robinson Treaties, issuing the following declarations regarding the Crown's obligations, among others:
- The Crown has a duty to consider, from time to time, whether it can increase the Robinson Treaties' annuity without incurring loss.
- If the Crown can increase the Robinson Treaties' annuity (i.e., it will not incur a loss), it must exercise its discretion to decide whether it will increase the annuity and, if so, by how much. The discretion afforded to the Crown is reviewable by the courts and must be exercised diligently, honourably, liberally, justly, and in a manner consistent with the honour of the Crown.
- The Crown's failure to increase the Robinson Treaties' annuity to date amounted to a dishonourable breach of the Treaties. The Crown must exercise its discretion and increase annuities to compensate the "egregious nature" of the Crown's past breach of the Robinson Treaties.
The Court did not mince words, finding that the Anishinaabe have been left with an "empty shell of a treaty promise" and referring to the Crown's conduct as a "mockery" of that promise.
More generally, the decision provides guidance on a number of legal issues relevant to Crown-Indigenous relations, described further below.
Interpretation of Historic Treaties
The SCC reviewed and confirmed the principles articulated in its earlier decisions governing the interpretation of historic treaties, highlighting that:
- Treaties are sui generis agreements because "they are the product of the special relationship between the Crown and Indigenous peoples that is aimed at achieving reconciliation" (para. 70);
- Treaty rights must be interpreted in accordance with the honour of the Crown which imposes an obligation of honourable dealing with Indigenous people (para. 71); and
- The distinction from modern treaties lies in the "relative precision and sophistication of the modern document", warranting deference to their text (paras. 76, 77).
The Court concluded that while factual findings that influence treaty interpretation attract deference (and are reviewable only for palpable and overriding errors), treaty interpretation itself is reviewable on a standard of correctness given the constitutionally protected nature of treaty rights.
In treaty interpretation, the court's goal is to determine the interpretation that comes closest to reflecting the signatories' common intention. This requires a two-step process: (1) consider the wording of the treaty clause at issue (in this case, the Augmentation Clause) to establish a range of possible interpretations; and (2) consider those interpretations against the treaty's historical and cultural backdrop. The perspectives of both parties must be taken into account, however, ambiguities are to be decided in favour of Indigenous signatories.
The Honour of the Crown
The honour of the Crown factored heavily into the Court's analysis. The honour of the Crown imposes upon governments a high standard of honourable dealing with Indigenous peoples. Although the honour of the Crown is not a cause of action, it is a guiding constitutional principle that can generate various duties. In this case, the Court found that the honour of the Crown gave rise to a duty of diligent implementation of its promises under the Robinson Treaties. The honour of the Crown was also found to influence the range of remedies available, with the Court emphasizing its ability to provide creative solutions aimed at furthering the goal of reconciliation.
The Scope of the Crown's Fiduciary Duty
In addition to duties arising from the honour of the Crown, the Court considered whether the Crown held a fiduciary duty to the beneficiaries of the Robinson Treaties, either ad hoc (arising from common law) or sui generis (arising from the special relationship between Indigenous peoples and the Crown). The Court rejected both claims.
With respect to the ad hoc fiduciary duty claim, the Court noted that such claims require evidence of an undertaking to act in the best interests of the beneficiary, to the exclusion of others' interests. The Augmentation Clause clearly requires the Crown to consider the public interest, so no ad hoc fiduciary duty could be found.
The Court similarly rejected the claim for a sui generis fiduciary duty. Such duties allow the Crown to balance competing interests, unlike ad hoc fiduciary duties. However, sui generis fiduciary duties arise in relation to specific or cognizable Aboriginal interests that "cannot be established by treaty or legislation" (para. 238). Although the Court did not outright reject the possibility of an Aboriginal interest arising in this case, its reasoning suggests that it will be difficult to establish an Aboriginal interest giving rise to a sui generis fiduciary duty in the context of a treaty.
Limitation Periods
The Court concluded that Ontario's limitations legislation did not apply to bar claims for breach of treaty.
All parties agreed that the applicable limitations legislation was Ontario's 1990 Limitations Act. The Court observed that, unlike other provincial limitations statutes (including those in British Columbia and Alberta), Ontario's 1990 Limitations Act does not include a residual provision or basket clause. This difference was key to the Court's analysis as the breach of treaty claims advanced did not fit into any of the causes of action listed in the applicable limitations legislation. This difference also provides a basis for reconciling the Court's conclusion in this case with the conclusion in Shot Both Sides v. Canada, 2024 SCC 12. Our summary of that decision can be accessed here.
Application to the Robinson Treaties
The Court ultimately determined that the Augmentation Clause requires the Crown to exercise its discretion to increase annuities payable beyond the "soft cap" of $4 per person, so long as it is not incurring loss. The Court found the bargain between the parties required the Crown to exercise its discretion. This bargain allowed the Crown to secure the land for settlement and mining, while the Anishinaabe were prepared to trust the Crown to act liberally and justly to increase the annuity when warranted (para. 195).
The Court strongly condemned the Crown's history of failing to live up to its obligations under the Robinson Treaties, noting that "it has lost the moral authority to simply say 'trust us'" (para. 262). However, the Court concluded that the Crown should be provided with an opportunity to exercise its discretion under the Augmentation Clause. This approach recognized that "while it is not the business of the courts to force the Crown to exercise its discretion in a particular way, it is very much the business of the courts to review exercises of Crown discretion for constitutional compliance" (para. 299). As such, the Court directed the Crown to "meaningfully" and "honourably" engage with the beneficiaries of the Robinson-Superior Treaty to "repair the breach of its constitutional obligations" and set out the process to remedy the Crown's breaches of the Robinson Treaties (set out above).
Despite providing the Crown with an opportunity to exercise it discretion, the Court emphasized that its decision does not prevent the Crown from being judicially compelled to pay a certain sum of money should the Crown fail to do so. The Court granted the Crown six months to reach a settlement with the beneficiaries of the Robinson-Superior Treaty, or if no settlement is reached, to exercise its discretion to determine an honourable amount owed as compensation for past treaty breaches. In this latter case, the Robinson-Superior Treaty beneficiaries may seek a judicial assessment of the amount of compensation offered and the process undertaken by the Crown to attempt to reach a settlement. If the Court agrees with the beneficiaries, it may: (1) order the Crown to re-determine the compensation amount; or (2) set an amount itself.
The Court's remedy is relatively rare. Given the Crown's long-standing breach and denial of its obligations for almost 150 years, the Court commented this was a case where declaratory relief would be insufficient.
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