Unfair regulatory investigations and decisions now present more than just judicial review risks – the regulator may be exposing themselves, their staff and even legal counsel to civil liability. In Thmbran v. The British Columbia College of Nurses and Midwives (Thmbran), the British Columbia Supreme Court permitted tort claims against both the College of Nurses and Midwives (College) and individual staff members to proceed, establishing that statutory immunity offers limited protection where there is bad faith handling of regulatory complaints.1
Case background
The dispute arose from a complaint alleging that a registered nurse failed to respond appropriately to reports of resident-on-resident sexual misconduct at a long-term care facility.2 The College's investigation exhibited many troubling irregularities that ultimately drew judicial criticism.3 The appointed inspector allegedly misrepresented key facts in a way that implicated the nurse, including changing material details such as the date and location of the alleged incident, with no clear explanation, ultimately leading the College to find her conduct unsatisfactory.4
After this finding, the College attempted to enter into a settlement agreement with the nurse.5 When she declined two proposed consent resolutions - each requiring compromising admissions that she denied - the College abruptly cancelled a scheduled disciplinary hearing just three weeks before it was set to begin.6 This hearing would have been the nurse's opportunity to challenge the allegations, with the College bearing the burden of proof. Instead, the College issued a “Letter of Expectation” that treated the allegations as established facts, permanently forming a part of her employment records without any hearing or right of appeal.7 This left the nurse with no meaningful opportunity to challenge the claims or clear her name.
The Court's analysis
Following this, the nurse sued the College, its legal counsel and the investigator, alleging that the conduct was “malicious, deceitful and fraudulent” both in the investigation and the decision-making process.8 She claimed she was wrongfully targeted by the college and used as a scapegoat to cover up the mishandling of the incident by other College members, and that the investigator and legal counsel had coerced and manipulated facts to ensure an outcome that was harmful to her reputation and wellbeing.9 The College responded with an application to strike the claim, arguing that it was protected by statutory immunity for acts done in good faith and in exercising its regulatory powers.10
The Court dismissed certain causes of action, including civil conspiracy, fraud, defamation and Charter breaches.11 Claims for malicious prosecution, misfeasance in public office and intentional infliction of emotional distress were allowed to proceed for demonstrating genuine issue for trial. The Court held it arguable that the College acted for an improper purpose (satisfying the malicious prosecution claim) by pressing the nurse to admit to allegations despite insufficient evidence, refusing to clarify the allegations despite repeated requests and allowing the inspector to alter facts throughout the investigation.12 The Court noted that the nurse's pre-existing illness was exacerbated by the College's conduct, reinforcing the claim for intentional infliction of emotional distress.13
Notably, the misfeasance claim against the College's legal counsel also survived the strike application. The Court found it plausible that the legal counsel relied on altered facts, ignoring the credibility issues with the complainant's account, and actively participated in the College's decision-making process, including issuing the settlement offers and the Letter of Expectation. As such, the legal counsel was integral to the flawed process and could not rely on statutory immunity.14
Overall, the Court was critical of the procedural irregularities, which robbed the nurse of proper notice and a chance to be heard. The Court noted that pressuring registrants to admit to changing facts during settlement discussions could constitute bad faith. The Court also noted these issues can be appropriately addressed in judicial review, and the nurse was granted extended time to commence judicial review if she chooses to.15
Implications for regulators
Thmbran signals that regulators must maintain procedurally fair, transparent and evidence-based processes. Shifting factual allegations without explanation, or pressuring individuals under investigation to resolve matters without the option of a fair hearing, may attract judicial scrutiny and give rise to tort liability. Where bad faith is alleged, investigators and legal counsels are not fully immune.
This case exposes a Catch-22 for regulators: negotiated resolutions often save time and resources, benefiting all parties. However, regulators should not rely on consent orders as a replacement for a transparent, fair hearings where necessary. Overly aggressive settlement tactics like requiring admissions to unproven facts can form evidence of bad faith and form the basis for civil claims. Where procedural fairness is compromised, regulatory committee deliberations and other internal records (including legal memos which are typically protected by privilege), may become relevant and producible in civil proceedings against the regulator and its staff.
Guidance for individuals facing regulatory investigation
For individuals involved in regulatory proceedings, Thmbran confirms that serious procedural improprieties can give rise to legal remedies beyond administrative review and can potentially result in civil damages. Individuals subjected to regulatory investigation should keep detailed records of procedural issues—including inconsistencies in the evidence, delays and refusals to clarify allegations— because these can be critical if civil action is contemplated in the future.
Footnotes
1. Thmbran v. The British Columbia College of Nurses and Midwives 2024 BCSC 441 [Thmbran].
2. Thmbran, paras 18 – 22.
3. Thmbran, para 92.
4. Thmbran, paras 22 – 34.
5. Thmbran, paras 35 – 54.
6. Thmbran, paras 57 – 61
7. Thmbran, paras 62 – 65.
8. Thmbran, para 2.
9. Thmbran, para 43.
10. Thmbran, paras 4 – 5.
11. Thmbran, para 142.
12. Thmbran, paras 101 – 102.
13. Thmbran, para 115.
14. Thmbran, para 127 – 128.
15. Thmbran, paras 92 – 94.
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