Expanded Immunity for Regulators from Civil Liability
Reprinted with Richard Steinecke's permission from Grey Areas, Steinecke Martin Maciura, April 2002. Subscribe to Grey Areas at no charge by sending an email to rsteinecke@sympatio.ca

In November of 2001, the Supreme Court of Canada indicated that regulators usually cannot be found liable for negligence in the conduct of their regulatory responsibilities: Cooper v. Hobart, 2001 SCC 79, and Edwards v. Law Society of Upper Canada, 2001 SCC 80. On April 22, 2002, the Ontario Court of Appeal has applied those decisions in a way that provides expanded protection for regulators from civil liability.

In Rogers v. Faught (unreported, April 22, 2002, Ont.C.A.), Ms. Rogers, a client of a dental hygienist, was undergoing routine preventative procedures. Ms. Rogers alleges that she suffered serious injuries to her temporomandibular joints ("TMJs") as a result of negligent treatment by the dental hygienist. She claims that, despite her complaints of severe pain and requests that she be allowed to close her mouth and rest, the dental hygienist insisted that the cleaning continue and demanded that she open her mouth as wide as possible. She claims that she has suffered severe, debilitating long-term pain and injury as a result. Ms. Rogers sued the dental hygienist, the employing dentists of the dental hygienist and the regulatory bodies for both professions (i.e., the College of Dental Hygienists of Ontario and the Royal College of Dental Surgeons of Ontario).

The claim against the regulators was not confined simply to negligent regulation of their members. The claim also stated that the regulators were liable because of the following:

— misfeasance of public office
— breach of statutory duty and
— breach of fiduciary duty
— violation of Ms. Rogers’ rights under section 7 of the Charter of Rights and Freedoms (security of the person) and
— violation of Ms. Rogers’ rights under section 15 of the Charter of Rights and Freedoms (equal protection of the law) on the basis that TMJ injuries are much more prevalent in women and the regulatory inaction may have been as a result of gender discrimination.

The two regulators brought a motion to dismiss the action against them. To succeed at this preliminary stage, the regulators had to assume that the facts pleaded in the statement of claim were true. The regulators also had to satisfy the court that it was "plain and obvious" that the action against them could not succeed. The regulators persuaded both the motions court and the Ontario Court of Appeal that the claims against them ought to be dismissed at this early stage.

The Court of Appeal first analyzed whether a claim for negligence could be made. The Court found that the regulatory scheme for health professions in Ontario was similar to those analyzed by the Supreme Court of Canada in Cooper v. Hobart, 2001 SCC 79, (mortgage brokers in B.C.) and Edwards v. Law Society of Upper Canada, 2001 SCC 80 (lawyers in Ontario). All of these regulators had to look to the broader public interest and were not designed to focus on the protection of individual members of the public to the exclusion of other considerations (such as fairness to members). As such, these regulators were not, in effect, an insurer of practitioners’ clients against the negligent practice of the profession by their members.

Misfeasance of public office occurs where a regulator uses its regulatory powers for an unauthorized purpose. The classic example is where, in the 1950’s, regulatory laws were used by the Premier of Quebec to discriminate against Jehovah’s Witnesses. Ms. Rogers claimed that the Royal College of Dental Surgeons of Ontario did not take appropriate measures to educate and warn their members about the risk of TMJ injury because the publication of such a warning might affect the professional liability insurance scheme it operated for its members. The Court was not prepared to accept this argument without the pleading of material facts that would support such an assertion.

The Court stated that there was no separate tort of breach of statutory duty.

The Court rejected the notion that regulators had a fiduciary duty (a high duty of undivided loyalty) to individual members of the public. The Court stated:

Since the College’s overriding duty is, as discussed above, to the public interest, they cannot owe a duty, especially one at the high level of fiduciary, to an individual client of a dentist or dental hygienist. As noted by Dickson J. in Guerin v. The Queen (1984), 13 D.L.R. (4th) 321 at 341 (S.C.C.): "[F]iduciary duties generally arise only with regard to obligations originating in a private law context. Public law duties, the performance of which requires the exercise of discretion, do not typically give rise to a fiduciary relationship."

The claims under the Charter of Rights and Freedoms was the most curious. This was an apparent attempt to avoid the statutory immunity enjoyed by the regulators for actions taken in good faith (since the Charter of Rights and Freedoms overrides any inconsistent law). The Court first said:

As a general proposition, the application of the Charter is confined to government action, not inaction: see Ferrel v. Ontario (Attorney General) (1998), 42 O.R. (3d) 97 (C.A.), leave to appeal to the Supreme Court of Canada refused December 9, 1999. The Colleges have the authority under the RHPA and the Code to develop and maintain programs and standards of practice for the professions of dentistry and dental hygiene. However, the Charter does not impose on the Colleges an affirmative duty to establish specific programs and standards of practice to deal with discrete medical problems.

The Court of Appeal also rejected Ms. Rogers’ request that she not pay the legal costs of the two Colleges. The Court did not accept that the claim against the Colleges was novel or that the action was a form of public interest litigation (where costs might be less likely to be ordered). The Court ordered Ms. Rogers to pay the Colleges’ costs. These will total about $50,000. (As an interesting sidebar, the two regulators in this case cooperated in preparing their defence of the claim including sharing ideas, dividing work and filing many joint documents so as to reduce significantly their own legal expenses.)

The decision in Rogers v. Faught confirms that the recent Supreme Court of Canada decisions are to be given a broad effect. They are not to be confined to one or two regulatory bodies but should apply to almost any statutory regulator. In addition, reframing the claim under other headings will not circumvent the protection for regulators. Finally, even if one is alleging bad faith or misfeasance of public office, one must provide particulars of those claims.

A significant aspect of these decisions that has yet to be fully considered is their impact on claims by members that their regulators have acted improperly in disciplining or otherwise regulating them. Are they in a different position than members of the public because they face the extraordinary powers that most regulators have? Does the regulator have a legal "duty of care" to the member such that the regulator can be sued for damages? Traditionally these claims have taken the form of a "malicious prosecution" claim. It may be that some aspects of these recent decisions will reduce the exposure of regulators to even those claims.

A copy of this decision can be located on the internet at: http://www.ontariocourts.on.ca/decisions

Next