Canada: Yes - Corporations DO Have Rights

Last Updated: December 21 2016
Article by Jeremy Schwartz and Ryan Conlin

We have written before on the groundbreaking decision of the Supreme Court of Canada in R v Jordan (see our previous blog post on that case here). In Jordan, the Supreme Court of Canada set hard caps on the time it takes to process a criminal (or regulatory) prosecution to trial. The time limit under the cap is determined by the court procedure elected by the Crown in prosecuting the offence.

If the actual time to the end of trial exceeds the cap, then absent certain defined circumstances, the right of the accused to be tried within a reasonable time under section 11(b) of the Canadian Charter of Rights and Freedoms is considered to have been breached. This invariably results in a stay of proceedings, which has the effect of dismissing the charges and preventing the Crown from laying them again.

In the Ontario Court of Justice, where offences under the Occupational Health and Safety Act ("OHSA"), Employment Standards Act, and other breaches of the Provincial Offences Act ("POA") are prosecuted, Jordan mandates that trials conclude within 18 months of the charges being laid.

As is often the case with watershed decisions, Jordan raised as many questions as it answered – among those key questions: 1. Jordan was a criminal case – is it applicable to non-criminal offences? 2. The defendant in Jordan was an individual charged with a criminal offence, would it apply to corporations facing OHSA and other charges under the POA? Historically, the protection against long delays in processing charges was different for corporate defendants than for individuals. Does that distinction still exist post-Jordan?

A recent case from the Ontario Court of Justice goes a long way towards answering those questions.

In R v Live Nation, an as-yet unpublished decision by Justice Nakatsuru of the Ontario Court of Justice, three corporate defendants and an individual defendant were charged with breaches of the OHSA. The charges stemmed from the June 16, 2012 collapse of the stage at a Radiohead concert in Toronto that killed one person and seriously injured several more.

Two of the corporate defendants and the individual defendant brought an application to stay the prosecution because of the delay in finishing the trial, citing Jordan. At the time of the application, it was estimated that 44 months would pass from the laying of the charges to the end of the trial.

When the Supreme Court issued Jordan, it provided certain exceptions to prevent a stay being ordered in exceptional circumstances and in certain "transitional" cases that began before Jordan was issued. Ultimately, the court in Live Nation ruled that the delay was not unreasonable, applying the exceptions. But the Court drew some important conclusions about the application of the Jordan test that may have significant ramifications for employers charged with breaches of the Occupational Health and Safety Act and other regulatory legislation.

Jordan Applies to Corporations

Perhaps the most important finding of the Court was that the new test from Jordan applies to corporations, not just individuals. The Court found that the interest of the public and participants in the justice system to timely resolution applies equally to corporations. Historically, corporations were acknowledged to have rights under section 11(b), although the bar for measuring a breach was set much higher than for an individual accused, pursuant to a 1992 Supreme Court decision called R v CIP.

Although CIP was based on the cases that Jordan overruled, the Supreme Court did not explicitly say in Jordan that CIP was no longer of force and effect. The Crown argued in Live Nation (as it has in every case since Jordan was issued) that this meant that CIP was still good law.

The Court disagreed. Critically, the Court held that the decision in CIP was an application of the test that existed for individuals under the old regime, in the context of a charge against a corporation. As such, the law on which both the old regime for individuals and CIP were based was the same, with different factors considered due to the differences between individual and corporate defendants. Since the underlying law had been overturned in Jordan, it meant that CIP, being based on that law, must also be overruled.

There was no rationale in the reasons in Jordan for any notion that the caps set out therein should not apply to corporations as well as individuals. Consequently, the Court found that Jordan applies to corporate defendants just as it does for individual defendants.

The Complex Case Exception: When Is Complexity Not Enough?

In Jordan, the Supreme Court ruled that particularly complex cases might not be subject to the strict time cap, if the case's complexity warranted or necessitated that more time be taken.

The Crown argued in Live Nation that this was exactly such a case.

The Court agreed. It ruled that the case was particularly complex, even in the world of prosecutions under the Occupational Health and Safety Act. There were significant questions about the cause of the collapse, reconstruction experiments, and multiple expert witnesses. In addition, highly technical evidence was required to speak to various disputed evidentiary matters. The four defendants were represented by three representatives, each of whom along with the Crown had an opportunity to call evidence and question each witness.

Thus, it was anticipated that the trial would take nine weeks to complete. This was up from an earlier estimate by the Crown which had forecast a six-week trial.

The Court found that the complexity of the case was linked to the delay, a necessary finding for the Court to relieve the Crown from the 18-month Jordan cap applicable to those proceedings.

Interestingly, the Court found that this was the end of the analysis, and stated that solely on this basis that this was a complex case, the application must fail. It did not analyze if, even given the complexity of the case, the delay was excessive. The Court suggested that, hypothetically, a long enough delay would eventually warrant a stay regardless of the complexity of the proceedings, but it did not offer any method by which this should be determined, nor did it explain why it found that the delay in this case was not excessive despite the complexity of the case.

The Court found that this was enough to dispose of the application. It also analyzed the transitional exception, finding that it too applied to relieve against the Jordan cap. However, this finding was not necessary to dispose of the application.

What Employers Need to Know

It is worth noting that prior to being appointed to the bench, Justice Nakatsuru was a senior lawyer with the Ministry of the Attorney General's Constitutional Law Branch. Due to this background and his expertise in the area, it seems likely that this decision will carry significant weight, although it is not technically binding on other courts.

The decision confirms what many lawyers have suspected since the release of Jordan, that the hard caps on bringing offences to trial set out in that decision apply to corporations as well as individuals. Of course, there are some nuances in terms of this analysis as it applies to defendants who were already charged at the time of Jordan's release in July. However, it appears that, if this aspect of Justice Nakatsuru's decision were followed by other courts going forward, corporations will have equal resort to Jordan.

Indeed, in our practice we have already seen Crown prosecutors, including in cases with only corporate defendants, taking a more proactive, almost aggressive approach to moving matters along quickly to trial. It is likely that Crown counsel will increasingly propose more aggressive timelines and demand that defendants waive their procedural rights if they require more time to respond. They may also seek quicker pre-trials and more proactively look to address pre-trial issues, such as disclosure, on an expedited basis.

Another interesting challenge will be for the Provincial Offences Court system itself, which is run by individual municipalities in Ontario. In many smaller centers, there is frequently only one courtroom to hear provincial offences matters. This can make it difficult to schedule lengthier matters expeditiously. We expect that the Provincial Offences Court system will require more resources and possibly access to more space to ensure that lengthier prosecutions can be scheduled within the timeframe mandated by Jordan. The Crown may also be forced to elect to have cases tried in the Provincial Court system in front of a judge if insufficient resources are available in the Provincial Offences Court.

It will be particularly important to ensure that corporations charged with offences, and their representatives, take extra care not waive rights unnecessarily nor take steps that could lead to delay.

Overall, this decision is helpful for employers faced with long delays in prosecutions of health and safety and other regulatory offences. It provides much needed substance to the guarantee in section 11(b) of a trial without undue delay, and offers some reassurance that significant prosecutions will be pursued with alacrity and will therefore be resolved more quickly. While extraordinarily complex cases may lead to longer timeframes, such cases are very much the exception rather than the rule. Thus, in most cases corporate defendants ought to now have a sense of the timeframe within which they can expect their cases be heard, and a measure to defend themselves against undue delay.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Jeremy Schwartz
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