of Veterans Affairs Act so veterans can't sue for retroactive interest on their pensions

INDEPTH: VETERANS
The Authorson case
Owen Wood, CBC News Online | July 17, 2003


1914-1918
Since the First World War, the federal government has provided pensions to veterans suffering from their experiences in war.

In cases where the veterans were deemed incapable of managing their pensions (i.e. the veterans were institutionalized with mental disorders such as shell shock), the funds were managed on their behalf.

If the pensions were not managed by relatives, friends or public trustees, the Department of Veterans Affairs (DVA) took care of them. However, the funds were never invested nor credited with interest by the DVA.

And in cases where a veteran died, the principal went to the federal government.

1960
The Canadian Bill of Rights is created, which states that the federal government can't take away the property rights of Canadians without a fair hearing, whether it be physical property, such as a home or land, or economic rights, such as pensions. However, the bill lacks the authority to strike down legislation because it is only a statute passed by Parliament – it is not entrenched in the Constitution Act of 1867.

1982
The Charter of Rights and Freedoms is created as part of Canada's new Constitution. Unlike the Bill of Rights, property rights are left out of the Charter.

1990
Prime Minister Brian Mulroney's government decides to pay interest on the pensions from 1990 onward.





The government also amends the Department of Veterans Affairs Act so veterans can't sue for retroactive interest on their pensions and other money held by the government between 1919 and 1990.

1999
A class-action lawsuit is launched against the federal government. The lawsuit argues that the failure either to invest the funds or pay interest on them is a breach of fiduciary duty by Ottawa.

It also says Ottawa violated veterans' property rights given under the Canadian Bill of Rights when it passed the statute barring veterans from suing for interest prior to 1990.

The case, Authorson v. Attorney General of Canada, is launched on the behalf of Joseph Patrick Authorson, a veteran of the Second World War.

After returning from the war, he was diagnosed with schizophrenia and post-traumatic stress disorder (shell shock) and spent most of the rest of his life in mental hospitals in London, Ont.

Because he was deemed unfit to manage his own finances and never married or had children, Ottawa took over the management of his pension and personal money.

In 1991, a doctor found Authorson fit to control his own money. He received $188,000 in pension funds and $166,000 of personal funds (from an inheritance). However, he did not received interest on his pension from 1943 to 1991. Lawyers estimated Ottawa owed him $500,000 to $2 million.

If successful, the case would set a legal precedent for all veterans in circumstances similar to Authorson's (between 25,000 and 35,000 veterans), which could cost the federal government between $600 million and $5.5 billion, according to lawyers representing the veterans.

However, accountants hired by the Justice Department put that figure below $50 million, money that would only be paid out to the 1,000 or so living veterans, not their relatives.

Sept. 13, 2000
Justice John Brockenshire of the Ontario Superior Court dismisses the federal government's argument that the Ontario court has no jurisdiction over the case.

Oct. 11, 2000
Justice Brockenshire rules in favour of the veterans, saying the federal government had breached its fiduciary duty by failing to invest or pay interest on the money it managed for the veterans.

"The government's actions towards the veterans could be classified as 'reprehensible,'" he said.

Brockenshire rules that the Canadian Bill of Rights overruled the statutes preventing veterans from suing for interest prior to 1990, and that the government sidestepped the due process of law.

Dec. 20, 2000
The government fails to limit the lawsuit to living veterans, which would have limited its liability to $44 million. Justice Brockenshire rules that Ottawa is not just liable to the veterans, but to their dependents as well, whether living or dead.

Jan. 10, 2001
Justice Brockenshire rules the government will have to pay as much as 100 per cent of the veterans' legal costs, at the time estimated at just over $800,000.

"The Crown voluntarily accepted responsibility for managing the funds of the veterans, then overlooked or ignored one of the most basic obligations against the interests of those it was supposed to help,'' he said. "There is considerable evidence this was not simply ignorance, as it had been pointed out repeatedly to the Crown by its own (bureaucrats) over the years.''

At least six internal government reports from as far back as the mid-1970s showed the government was aware it was not meeting its responsibilities toward the veterans. And an auditor general's report from the mid-1980s showed the Department of Veterans Affairs was aware it had neglected the duties of a trustee. The auditor general's office warned the federal government that it could face an expensive court defeat if it didn't change the way it administered the veterans' accounts.

Feb. 8, 2001
The federal government announces it will appeal the Ontario Superior Court decision.

March 13, 2002
The Ontario Court of Appeal upholds the lower court's ruling, agreeing with Justice Brockenshire that Ottawa breached its fiduciary duty by failing to invest or pay interest on the veterans' pensions.

June 5, 2002
Joseph Patrick Authorson, 88, dies in Ontario.

However, his case continues in his name.

Oct. 17, 2002
The Supreme Court of Canada agrees to hear the federal government's appeal.

April 10, 2003
The Supreme Court hears the appeal.

July 17, 2003
The Supreme Court of Canada rules unanimously in favour of the federal government, saying Ottawa had the right to enact the legislation barring veterans from suing for interest on the pensions prior to 1990.

The Supreme Court agrees that the veterans are owed decades of interest on their pension and benefit funds. But when the federal government chose to deny veterans this money, it did so lawfully. The ruling says the amendments made to the Department of Veterans Affairs Act in 1990 are not inconsistent with the Canadian Bill of Rights.



What I Richard Harris think here is Prime Minister Brian Mulroney's government decides to use Propaganda to make
Government look good to the Taxpayers

All side of the Government knew they would never pay out.

But there Lawyer friend got there money by the look of this.

Justice Brockenshire rules the government will have to pay as much as 100 per cent of the veterans' legal costs, at the time estimated at just over $800,000.

Mr. Young served as Canada`s Minister of Transport, Minister of Human Resources Development, and Minister of National Defence and Veterans Affairs.

A lawyer and businessman, he was elected to the federal and provincial levels of government in Canada between 1978 and 1997.