In recent years, the question of whether successful complainants are entitled to recover legal costs in human rights proceedings has received considerable attention from tribunals and courts across the country. There have been conflicting decisions from different adjudicators and the issue continues to be controversial.

This issue will soon be addressed by the Supreme Court of Canada by way of an appeal from the Federal Court of Appeal’s decision in Canada (Attorney General) v Mowat1. The central issue on appeal is whether the Canadian Human Rights Tribunal (the “CHRT”) has jurisdiction to award legal costs to a successful complainant.  

The Mowat decision involved a sexual harassment complaint filed by an employee of the Canadian Armed Forces. The CHRT found that the complaint had been substantiated, and awarded the complainant $4,000 plus interest for “suffering in respect of feelings or self respect”. She was also awarded $47,000 plus interest for legal costs. The CHRT found that it had jurisdiction to make the award for legal costs, pursuant to section 53(2)(c) of the Canadian Human Rights Act (the “Act”), which permits the tribunal to compensate victims for “any expenses incurred” as a result of discrimination.

The employer applied for judicial review of the CHRT’s decision to the Federal Court. Adopting a deferential standard of review, the Federal Court considered whether the CHRT’s decision was reasonable. In the Federal Court’s view, section 53(2)(c) of the Act was broad enough to confer upon the CHRT the power to award legal costs. As such, the Federal Court concluded that the CHRT’s decision was reasonable.

The Federal Court of Appeal took a significantly different view. First, the Court of Appeal noted that the question of jurisdiction to award legal costs was a matter of general law which has central importance to the legal system as a whole. It also found that the proper interpretation of section 53(2)(c) of the Act did not require any human rights expertise to decide. As such, the Court of Appeal determined that the CHRT’s decision was to be reviewed on the standard of correctness.

Turning to the merits of the case, the Court of Appeal found that section 53(2)(c) of the Act could not be interpreted as granting the CHRT the power to award legal costs. In reaching this conclusion, the Court of Appeal made a distinction between “expenses” and “costs”, noting that the latter has specific meaning as a legal term of art. Further, the Court of Appeal went on to note that in jurisdictions where human rights tribunals have jurisdiction to award legal costs, their enabling statutes refer specifically to such powers. In the absence of such specific wording in the federal Act, the Court of Appeal found that the CHRT did not have jurisdiction to award legal costs. Had Parliament intended to confer such power upon the CHRT, it could have done so explicitly.

The Supreme Court of Canada will decide the narrow issue of whether the CHRT has jurisdiction to award legal costs. However, it is also likely to be binding in other jurisdictions which contain compensatory provisions similar to the federal Act. Even in jurisdictions with significantly different legislation, the Supreme Court’s decision will likely clarify the proper analysis and relevant factors to consider in determining whether legal costs can be awarded in human rights proceedings. A finding that legal costs can be recovered in human rights proceedings may have significant impact on how such complaints are litigated and the financial risks associated with pursuing such action.