Any substantive changes in this Legislative Summary that have been made since the preceding issue are indicated in bold print.
Bill C-35, An Act to deter terrorism, and to amend the State Immunity Act (the Justice for Victims of Terrorism Act(1) or JVTA) was introduced in the House of Commons on 2 June 2009 by the Minister of Public Safety, the Honourable Peter Van Loan. The bill creates a cause of action (i.e., grounds to sue) that allows victims of terrorism to sue individuals, organizations and terrorist entities for loss or damage suffered as a result of acts or omissions that are punishable under Part II.1 of the Criminal Code(2) (the part of the Code dealing with terrorism offences) and which have been committed by these individuals, organizations or entities. It also allows victims of terrorism to sue foreign states that have supported terrorist entities which have committed such acts, in certain circumstances. The victim’s loss or damage can have occurred inside or outside Canada but must have occurred on or after 1 January 1985. If the loss or damage occurs outside Canada, there must be a “real and substantial” connection to this country. Bill C-35 also amends the State Immunity Act(3) to create a new exception to state immunity, the general rule that prevents states from being sued in Canada’s domestic courts. However, the new exception serves to remove state immunity only when the state in question has been placed on a list established by Cabinet on the basis that there are reasonable grounds to believe that it has supported or currently supports terrorism.
Bill C-35 is similar to a number of private members’ bills and senators’ public bills that have been introduced in Parliament since 2005.(4) The primary difference between the previous bills and Bill C-35 is that the other bills sought to include the cause of action in the Criminal Code, whereas Bill C-35 creates a free-standing civil cause of action.
One of the most significant features of Bill C-35 is the fact that it gives victims of terrorist acts the ability to sue foreign states that support terrorism in Canada’s domestic courts.(5) Most states do not recognize sponsoring or supporting terrorism as an exception to the general state immunity principle.(6)
Customary international law historically gave states, their agents and instrumentalities complete immunity from being sued in the domestic courts of other states. This principle arose out of another international law principle – the sovereign equality of states. As stated by law professor John Currie, “[i]f all states are equal in international law, so the theory goes, no one state should be able to subject another to the process of its courts.”(7)
Subsection 3(1) of the State Immunity Act demonstrates Canada’s acceptance of this general rule. It states: “Except as provided by this Act, a foreign state is immune from the jurisdiction of any court in Canada.” A foreign state is defined, in section 2 of the State Immunity Act, to include sovereigns or other heads of foreign states when acting in their public capacity, as well as governments, departments or agencies of that state. It also includes heads of political subdivisions, such as provinces, when acting in their public capacity, and political subdivision governments, departments and agencies. Having said this, exceptions to the general rule of complete immunity have evolved in customary international law over time. Parliament has acknowledged this evolution by codifying the most common exceptions to the general rule of state immunity in the State Immunity Act as it currently stands. These exceptions include:
In each of these situations, Canadian courts have civil jurisdiction over foreign states, their agents and their instrumentalities. Bill C-35 seeks to add a new exception for state support of terrorism.
The only country with similar legislation appears to be the United States, which has enacted the Antiterrorism and Effective Death Penalty Act of 1996 and has amended its Foreign State Immunity Act to provide for an exception similar to that proposed in C-35. More information on the American experience is provided below in the Commentary section of this Legislative Summary.
Bill C-35 contains a preamble and 11 clauses.
The preamble provides some insight into the motivating factors behind Bill C-35, the objectives it is designed to serve and the context within which it is to be interpreted and applied if adopted by Parliament. In particular, the preamble:
Clause 1 provides the short title for the new Act introduced by Bill C-35: the Justice for Victims of Terrorism Act.
Clause 2 defines three terms that are used throughout the JVTA. All three terms are defined in relation to definitions that are contained in other statutes. Clause 2 of the JVTA defines “foreign state” as having the same meaning as in section 2 of the State Immunity Act. As stated above, this means that a foreign state includes sovereigns or other heads of state when acting in their public capacity, as well as governments, departments or agencies of the state, the heads of political subdivisions of the state, such as provinces, when acting in their public capacity, and political subdivision governments, departments and agencies.
Similarly, “listed entity” is defined as having the same meaning as in subsection 83.01(1) of the Criminal Code, which defines it as “an entity on a list established by the Governor in Council under section 83.05.” Sections 83.05 to 83.07 of the Criminal Code(8) set out the process for listing entities and the criteria of which the Governor in Council must be satisfied before an entity can be listed.(9)
Finally, “person” is defined in clause 2 as including an organization as that term is defined in section 2 of the Criminal Code. Section 2 of the Code states that an “organization” means:
(a) a public body, body corporate, society, company, firm, partnership, trade union or municipality, or
(b) an association of persons that
(i) is created for a common purpose,
(ii) has an operational structure, and
(iii) holds itself out to the public as an association of persons.
By incorporating the definitions contained in other statutes by reference, Bill C-35 defines the three terms contained in clause 2 (in particular, “foreign state” and “listed entity”) in a much broader and more detailed fashion than is immediately apparent from the words themselves.
Clause 3 states that the JVTA’s purpose is to “deter terrorism by establishing a cause of action that allows victims of terrorism to sue perpetrators of terrorism and their supporters.” The fact that the bill’s stated purpose is to “establish a cause of action” that allows for civil lawsuits might raise the question of whether or not Parliament has the necessary constitutional jurisdiction to enact the JVTA. This issue is discussed in further detail in the Commentary section at the end of this Legislative Summary.
Clause 4 provides the parameters of the new cause of action created by Bill C-35. In many respects, the cause of action is broad in scope. For example, clause 4(1) states that any person may bring such an action, regardless of whether the loss or damage he or she suffered occurred inside or outside Canada, as long as the act or omission that caused the loss or damage “is, or had it been committed in Canada would be, punishable under Part II.1 of the Criminal Code.” As stated previously, Part II.1 of the Criminal Code contains terrorism-related offences. Accordingly, in order to sue under the JVTA, the plaintiff must have suffered loss or damage as a result of a defendant’s having committed one or more of the following acts or omissions (section numbers refer to the Code):
Given that clause 4 creates a civil cause of action, presumably the standard of proof that would be used to determine that the defendant committed one or more of the acts or omissions outlined above, as well as the standard that would be used to demonstrate that the act or omission in question caused harm to the plaintiff, would be the “balance of probabilities” standard. That standard is generally used in civil litigation, rather than the higher, “beyond a reasonable doubt” standard used in criminal law. The lower standard of proof would serve to broaden the scope of the cause of action outlined in the JVTA, by increasing the likelihood of a successful claim.
The time limit applicable to bringing this cause of action also appears to be quite broad. Clause 4(1) is retrospective in scope: it allows victims who have suffered loss or damage as a result of terrorist acts or omissions to bring an action against the perpetrators of such acts or omissions as long as they were committed on or after 1 January 1985 (it is more common for legislation to apply only to actions committed on or after the date when it is enacted). The JVTA is likely designed to operate retrospectively so that families of the victims of the bombing of Air India Flight 182, which occurred on 23 June 1985, can potentially benefit from this new cause of action.
In addition, clause 4(3) of the JVTA states that any “limitation or prescription period” for bringing an action described in clause 4(1) does not start running until clause 4 comes into force. Clause 4(3) also suspends the running of the limitation or prescription period during such time as the person who suffered the loss or damage is incapable of commencing an action because of a physical, mental or psychological condition, or is unable to determine the identity of the person, listed entity or foreign state that engaged in the conduct resulting in the damage to him or her. Finally, clause 4(1) specifies that the cause of action may be brought in “any court of competent jurisdiction,” which appears to give the victim a choice of forum, as long as the court in question has jurisdiction over the forum and subject matter in question, as well as the authority to make the order sought.(10)
Although the cause of action itself, the time limit for bringing such an action and the forum for bringing the action all serve to broaden the scope of this new cause of action, other parts of clause 4 impose restrictions or limits on how this cause of action may be used, particularly in relation to foreign states. For example, although clause 4(1)(a) allows victims of terrorist acts to sue persons, organizations and listed entities who have caused them loss or damage by committing any act or omission punishable under Part II.1 of the Criminal Code, foreign states may be sued only if they did something to benefit the person, organization, or listed entity that actually caused the harm in question. As such, it appears that the cause of action does not cover situations where a state was involved directly.
Clause 4(1)(b) provides that if foreign states, persons, organizations or listed entities did not themselves commit the act that caused the harm, but merely did something to benefit the listed entity which committed that act, they will be found liable only if they committed one or more of the following acts (section numbers refer to the Criminal Code):
In addition, clause 4(2) of the JVTA provides that courts may hear and determine the cause of action referred to in clause 4(1) only if the action “has a real and substantial connection to Canada” (i.e., the victim is Canadian, the defendant is Canadian, the harm occurred in Canada or on a vessel or aircraft in Canada, and so forth).(11) In addition, clause 4(4) of the JVTA says that courts may refuse to hear a claim made under clause 4(1) in cases where the claim has been made against a foreign state, the loss or damage to the plaintiff occurred in that state, and the plaintiff did not give the foreign state “a reasonable opportunity to submit the dispute to arbitration in accordance with accepted international rules of arbitration.”(12)
Finally, while clause 4(5) of the JVTA states that courts of competent jurisdiction in Canada must recognize judgments of foreign courts made in favour of plaintiffs who have suffered loss or damage of the type described in clause 4(1), courts will do so only if the foreign judgment meets the requisite criteria under Canadian law for the recognition of such judgments.(13) In the case of a suit launched by a plaintiff against a foreign state, recognition of a foreign judgment made against the state in question is further restricted. Clause 4(5) specifies that, for a foreign judgment made against a foreign state to be recognized in Canada, the foreign state must be on the list established by Cabinet under subsection 6.1(2) of the State Immunity Act. (That subsection is added by clause 7 of the JVTA; see below.)
Although the JVTA itself does not explicitly state that only foreign states on the list established by Cabinet under new subsection 6.1(2) of the State Immunity Act may be sued using the cause of action described in clause 4(1) of the JVTA, the practical effect of the amendments introduced to the State Immunity Act is that only listed foreign states may be sued. This is because the amendments to the State Immunity Act create an exception to state immunity only for listed states that support terrorism. Further details on the listing process will be provided below.
Clauses 5 to 11 of Bill C-35 amend the State Immunity Act to create another exception to the general rule that immunizes foreign states from suits in Canada’s domestic courts, as that rule is expressed in subsection 3(1) of the Act.(14) These amendments are necessary in order to make the right of action described in clause 4(1) of the JVTA meaningful. Clause 5 is a housekeeping amendment that introduces a new heading, “Definitions and Interpretation,” before section 2 of the State Immunity Act.
Clause 6 of Bill C-35 adds a new section 2.1 to the State Immunity Act. The new section 2.1 indicates that a foreign state supports terrorism if it commits an act described in clause 4(1)(b) of the JVTA. In other words, foreign states are considered to support terrorism, and can be sued for supporting terrorism, only if they engage in conduct that supports the activities of listed entities as outlined in sections 83.02 to 83.04 or 83.18 to 83.23 of the Criminal Code.
Clause 7 of Bill C-35 adds a new section 6.1 to the State Immunity Act. New section 6.1 provides that, for a foreign state to be sued under clause 4(1) of the JVTA, the act that the state committed in support of terrorism must have been committed on or after 1 January 1985 (new subsection 6.1(1) of the Act). The date chosen mirrors the date found in clause 4(1) of the JVTA. As noted above, this date was likely chosen to allow families of victims of the Air India bombing to sue foreign states (provided that the victims’ families can demonstrate that a foreign state committed an act on or after 1 January 1985 in support of the listed entity which committed that bombing).(15)
In addition, before a foreign state can be sued using clause 4(1) of the JVTA, the state in question must have been listed by Cabinet (new subsection 6.1(1)). New subsections 6.1(2) to 6.1(7) of the State Immunity Act set out the procedure for listing foreign states. The process is very similar to that described in sections 83.05 to 83.07 of the Criminal Code for the listing of terrorist entities. The Minister of Foreign Affairs recommends listing, after consulting the Minister of Public Safety, and Cabinet decides whether or not to list. The basis for listing a foreign state is that there are reasonable grounds to believe that the state in question supported or supports terrorism, as defined in the new section 2.1 of the Act (new subsection 6.1(2)).
The Minister of Foreign Affairs, in consultation with the Minister of Public Safety, is required to review the list of foreign states every two years to determine whether or not reasonable grounds to keep the state on the list remain, and then makes a recommendation to Cabinet about whether or not the entity should be retained on the list (new subsection 6.1(6)). He or she must complete this review as soon as feasible, but in no more than 120 days after commencing it, and must publish a notice in the Canada Gazette without delay once the review has been completed (new subsection 6.1(7)).
Foreign states may not challenge or make submissions with respect to the listing decision prior to its being made. They can, however, apply in writing to the Minister of Foreign Affairs to be removed from the list once they have been added to it. In such cases, the Minister of Foreign Affairs must, after consulting the Minister of Public Safety, decide whether there are reasonable grounds to recommend to Cabinet that the state in question be removed from the list (new subsection 6.1(3)). Once the Minister of Foreign Affairs has made a decision regarding the foreign state’s application for removal, he or she must notify the state without delay (new subsection 6.1(4)). A foreign state may not make another application to be removed from the list unless there has been a material change in its circumstances since the last time it applied for removal, or until the Minister has completed his or her most recent two-year review of the decision to recommend listing (new subsection 6.1(5)).
The most significant difference between the process for listing foreign states contained in new subsections 6.1(2) to 6.1(7) of the State Immunity Act and the process for listing terrorist entities contained in sections 83.05 to 83.07 of the Criminal Code is that subsections 6.1(2) to 6.1(7) of the State Immunity Act do not grant states an explicit statutory right to apply for judicial review of the Minister’s decision to recommend listing the state in question, or to recommend retaining the state in question on the list established by Cabinet. Under subsection 83.05(5) of the Criminal Code, terrorist entities are explicitly granted this right.
Clause 8 of Bill C-35 repeals the existing subsection 11(3) of the State Immunity Act and replaces it with a new subsection 11(3). Subsection 11(1) of that Act restricts the type of relief (i.e., what a plaintiff may request as a result of his or her suit) that is available when an action is brought against a foreign state. The existing subsection 11(3) makes section 11(1) inapplicable to the agencies of a foreign state, meaning that all regular forms of relief are available to plaintiffs when they sue such agencies, but not if they sue the actual state. The new subsection 11(3) makes all forms of relief available to plaintiffs in an action against agencies of a foreign state, and also in an action against the foreign state itself.
Clauses 9 and 10 of Bill C-35 amend the State Immunity Act to allow for attachment, execution, arrest, detention, seizure and forfeiture of property belonging to foreign states that is located in Canada, in certain circumstances. Clause 9 amends the existing paragraph 12(1)(b) of the State Immunity Act to allow for the attachment, execution, arrest, detention and seizure of property belonging to foreign states and located in Canada when the state in question is on the list established by Cabinet under new subsection 6.1(2) of the Act, and the property in question “is used or intended to be used … to support terrorism.” It also adds a new paragraph 12(1)(d) to the Act. This paragraph allows for the attachment, execution, arrest, detention and seizure of the property of a foreign state located in Canada if the foreign state is listed under new subsection 6.1(2) of the Act, and the attachment or execution is for the purposes of satisfying a court judgment rendered against that state in an action brought against it for supporting terrorism. Having said this, if the property of that state in Canada has cultural or historical value, then it cannot be attached or executed upon to satisfy such a judgment.
Clause 10 of the bill adds a new section 12.1 to the State Immunity Act. Subsection 12.1(1) provides that, in the event that a judgment is rendered against a listed foreign state for supporting terrorism, the Minister of Finance and the Minister of Foreign Affairs may, within the confines of their mandates, assist a judgment creditor in identifying and locating the property of the foreign state in Canada. With respect to the Minister of Finance, he or she may assist in locating and identifying the financial assets of the foreign state held within Canadian jurisdiction (new paragraph 12.1(1)(a)), and with respect to the Minister of Foreign Affairs, he or she may assist in locating the property of the foreign state within Canada (new paragraph 12.1(1)(b)).
However, it is important to note that this provision is permissive, rather than mandatory. The ministers may assist in identifying and locating the property of the listed foreign state, “to the extent that is reasonably practical,” unless “the Minister of Foreign Affairs believes that to do so would be injurious to Canada’s international relations or either Minister believes that to do so would be injurious to Canada’s other interests” (new subsection 12.1(1)). In addition, if the information regarding the identity and location of such property was produced in or for a government institution, or was initially received by a government institution and obtained from that institution, the ministers must obtain the consent of the relevant government institution before releasing the information to judgment creditors (new subsection 12.1(2)). “Government institution” is defined in the new subsection 12.1(3) of the State Immunity Act as “any department, branch, office, board, agency, commission, corporation or other body for the administration or affairs of which a minister is accountable to Parliament.”
In addition to Bill C-35’s other amendments to the State Immunity Act, clause 11 amends subsection 13(2) of that Act to allow Canadian courts to levy fines or penalties against listed foreign states for failure or refusal to produce documents or information in respect of actions brought against them for supporting terrorism. Provision of such documentation and information would assist Canadian courts in rendering judgments in lawsuits initiated against foreign states pursuant to clause 4(1) of the JVTA.
Victims of terrorist attacks have been pushing for legislation similar to Bill C-35 for a number of years. The Canadian Coalition Against Terror (C-CAT), which is a coalition of victims and others interested in counterterrorism, has been particularly influential in the proposal of similar bills over the past four years.(16) The first proposed bills were introduced in 2005 by Senator David Tkachuk in the Senate, and by Stockwell Day, MP, who was in opposition at the time, in the House of Commons.
C-CAT argues that such legislation is necessary to fight terrorism financing effectively, as criminal provisions against terrorism financing have not resulted in any convictions.(17) Public exposure of such activities through court proceedings is also seen as an important deterrent.(18) Finally, it has been argued that the opportunity to sue would be empowering for victims, providing compensation and, even if they are unable to recover the amounts granted by the courts, at least providing official recognition of their experiences and suffering.(19)
One point of clarification is important at the outset, as a number of articles discussing the new bill have said that it is not currently possible to sue an individual or a non-state organization without this bill.(20) However, as noted by Edward Belobaba, the lawyer who assisted in drafting a private member’s bill on this topic for Senator Tkachuk, victims can theoretically already seek damages from non-state actors for their support of terrorist activities or organizations. The benefit of the proposed bill, according to Mr. Belobaba, is to make the law clearer and easier to understand, by introducing a specific cause of action, rather than requiring victims to rely on the general law of civil responsibility or tort law in each province.(21)
Though rare, there appear to have been some such suits in the past. A suit by Air India bombing victims’ families against the federal government, airlines and airport security was settled out of court.(22) However, that suit does not appear to have gone after the bombers or any supporting organizations. In July 2008, the Lebanese Canadian Bank was sued by four Canadian-Israeli dual citizens who were in Israel during the 2006 hostilities between Israel and Hezbollah. They alleged that the Bank provided banking and financing services to Hezbollah. That lawsuit appears to be ongoing.(23)
There appear to have been no final judgments for terrorism-related civil suits in Canada to date. Victims of terrorist acts have won such lawsuits in other common law jurisdictions by relying on torts such as battery and intentional infliction of harm. For a recent example, see Breslin and others v. Seamus McKenna and others, [2009] NIQB 50, in which Morgan J., of Northern Ireland’s High Court of Justice, found several individual defendants, as well as the Real IRA (a paramilitary organization that split from the Provisional Irish Republican Army in 1997), liable for loss and damages suffered by victims of the 1998 Omagh bombing and their relatives. That judgment awarded more than £1.6 million to 12 individuals.
A number of concerns with the JVTA have been raised by members of Parliament, lawyers and civil society members; these will be discussed in further detail below.
Generally, civil lawsuits that allow victims to recover damages for harm suffered or loss inflicted as a result of someone else’s tortious conduct are considered matters of provincial jurisdiction under subsection 92(13) of the Constitution Act, 1867,(24) which gives provincial legislatures the power to legislate regarding “property and civil rights in the province.” As stated by Canadian legal expert Peter Hogg:
The federal Parliament has no independent power to create civil remedies akin to its power over criminal law. This means that if the pith and substance of federal law is the creation of a new civil cause of action, the law will be invalid as coming within the provincial head of power “property and civil rights in the province” (section 92(13)).(25)
Having said this, it has been argued successfully in the past that Parliament can establish provisions related to civil redress if they are established within the context of a broader regulatory or administrative scheme which is itself within Parliament’s legislative jurisdiction under section 91 of the Constitution Act, 1867.
The case cited in support of this argument is General Motors of Canada Ltd. v. City National Leasing, [1989] 1 S.C.R. 641. That case involved the establishment by Parliament of a private right of action within the now repealed and replaced Combines Investigation Act allowing for the recovery of losses suffered as a result of activities in violation of that Act. The Court found that the legislation being addressed in the case, with its administrative, regulatory, and criminal law components, fell within Parliament’s legislative jurisdiction over trade and commerce under subsection 91(2) of the Constitution Act, 1867. The provision for civil redress was a part of this broader regulatory and administrative approach to dealing with anti-competitive business practices.(26)
A similar provision can now be found in section 36 of the Competition Act.(27) The regulatory and administrative scheme set out in that legislation also involves criminal offences and functions to be carried out by a Bureau, a Commissioner, and a Tribunal. If the issue were to arise under the current Competition Act, the Supreme Court of Canada ruling in the General Motors of Canada case would likely still apply.
Following the reasoning of the Supreme Court of Canada in General Motors of Canada, it is possible that the civil right of action set out in the JVTA could be viewed as having been enacted in the broader legislative context of the amendments to the State Immunity Act, which comprise the second part of Bill C-35 and which appear to be within Parliament’s jurisdiction under its power to legislate with respect to foreign affairs and international trade.(28) This argument would have greater force, however, if the JVTA were creating a right of action against foreign states only, rather than against foreign states, individual persons, organizations and listed entities. As stated previously in this Legislative Summary, victims already have the ability to sue persons, organizations and listed entities for tortious conduct that has caused them injury or harm under ordinary provincial tort law or civil responsibility principles.
Alternatively, it might be possible to view the JVTA as functionally connected to Parliament’s power to legislate in relation to criminal law (subsection 91(27) of the Constitution Act, 1867) because the civil remedy is available only if plaintiffs can show that they have suffered loss or damage as a result of “an act or omission that is, or had it been committed in Canada would be, punishable under Part II.1 of the Criminal Code” (clause 4 of the JVTA). Whether or not the courts would uphold the statute on this basis is, however, open to question, given that it does not appear that securing a criminal conviction under Part II.1 of the Code is a precondition to initiating a civil action under the JVTA.(29) Many civil suits relate to Criminal Code offences, such as assault, but that is not sufficient to justify federal jurisdiction and those suits are governed by provincial laws.
The national concern branch of the federal government’s power to legislate on matters involving peace, order and good government provides another possible head of power under which Parliament might be authorized to enact the JVTA.(30) The preamble of the JVTA states that “terrorism is a matter of national concern,” which could be an indication that this power is being relied upon.
One of the most common criticisms of the bill is that it includes terrorism offences but not torture. Some lawyers and commentators, such as the Canadian Centre for International Justice (CCIJ), find that there is no justification or rational basis to allow suits for one but not the other.(31) CCIJ and Amnesty International are promoting the inclusion of torture, genocide, war crimes and crimes against humanity in C-35, along with terrorism.(32)
In support of the argument that a right to sue for torture should be included, lawyer Prasanna Ranganathan, in a 2008 academic journal article, refers to the United Nations Committee Against Torture’s recommendations. In 2005, the Committee challenged Canada’s interpretation of Article 14 of the Convention Against Torture.(33) In the 2004 case of Bouzari, the Ontario Court of Appeal had concluded that Article 14 applied only to torture inflicted in Canada, whereas the Committee recommended that civil suits should be allowed regardless of where the torture occurred.(34) The Committee also concluded that there was no impediment in international law to creating an exception from state immunity for acts of torture, an interpretation that was challenged by Canada.(35)
The United States’ legislation lifts immunity for “an act of torture, extrajudicial killing, aircraft sabotage, hostage taking, or the provision of material support or resources,” thus including both terrorist acts and torture.(36) Some countries in Europe are also lifting immunity for torture, such as Italy, which has permitted suits against Germany for its actions during World War II.(37) Private members’ bills addressing torture, but not terrorism, are currently before the House of Lords and the House of Commons in the United Kingdom.(38)
However, in December 2008, in response to Italy’s lifting of immunity, Germany brought a suit before the International Court of Justice against Italy for failing to respect its immunity.(39) In Canada, C-CAT has been reported as saying that torture raises different issues and is not well suited to inclusion in C-35.(40)
Various diplomatic challenges may be created by Bill C-35, according to commentators. One article described the proposed legislation as a “diplomatic minefield.”(41) Listing countries may be problematic for Canada’s foreign relations. Similarly, the ministers of Finance and Foreign Affairs’ proposed role in enforcing judgments through such actions as identifying and locating assets for seizure may negatively affect diplomatic efforts. For example, Afghanistan and Pakistan are commonly seen as “incubators” of terrorism but their listing could be problematic from a diplomatic perspective as the Canadian government seeks to support the governments of those countries.(42) Others question whether courts are equipped to deal with the foreign policy and international relations considerations that will inevitably be attached to such cases.(43)
At the same time, others, such as lawyer Prasanna Ranganathan, argue that having the courts involved is exactly what is needed to avoid political influences. The politicians will be able to distance themselves from specific decisions and explain the responsibility of the courts, which are beyond their control, when speaking with their counterparts from other countries.(44)
Concern about retaliation has also been raised. The above-mentioned situation between Italy and Germany provides an example of the potential reaction to creating a new exception to state immunity.(45)
Aaron Blumenfeld, a Toronto lawyer who works with C-CAT, admits that this type of litigation will be quite complex. Classified information may be involved, and links between terrorist entities and the states in question will have to be proven, which could be difficult.(46) Showing causation will also be challenging as, for example, governments may provide funds to an organization involved in numerous activities, from health care to terrorism. Tracking where specific funds go could be time-consuming, costly and even impossible.
Previous bills did not include a government list of countries for which state immunity may be lifted, and C-CAT would prefer not to have such a list.(47) The Honourable Irwin Cotler’s proposed bill, Bill C-408, which was introduced two days after C-35, suggests eliminating the list and, instead, allowing any country with which Canada does not have an extradition treaty to be sued. According to the proponents of this proposal, including Mr. Cotler and law professor François Larocque of the University of Ottawa, this would make the process less politicized than requiring government listing of a country in order to be able to sue while still preventing baseless claims.(48) Countries with which Canada has extradition treaties are presumed to respect the rule of law and be democratic, and as such, it is assumed that claims could be made directly in those countries, rather than in the Canadian courts.(49)
Mark Arnold, a lawyer who represented Houshang Bouzari in his attempt to sue the Iranian government in a Canadian court for torture conducted in Iran, notes that the issue should be the activity in which a state is involved, not which state is involved. He finds that listing is too political. However, Ed Morgan, law professor at the University of Toronto, suggests that listing is a good compromise given the potentially negative foreign relations implications of such suits. Listing allows the government to retain some control of Canada’s relations with other nations.(50)
In the United States, similar legislation has been in place for more than a decade. Only listed countries can be sued, with currently listed countries being Cuba, Iran, Syria, Sudan and North Korea. Iraq and Libya were originally listed but have since been delisted.
A common problem identified by the Congressional Research Service (CRS) has been the refusal of defendants to recognize the jurisdiction of the American courts. As such, defendants do not appear and default judgments are rendered, which the debtor countries then ignore and refuse to pay.(51)
Recovery has been a major problem, given the limited assets of listed countries being held in the United States and the executive branch’s resistance to allowing frozen assets to be used for this purpose. As Congress attempted to create avenues for recovery, the executive would resist such efforts over concerns about retaliatory measures, losing leverage over the countries concerned, and potentially violating international law on state immunity. For example, the 1981 Algiers Accord that resulted in the release of American embassy staff who were held hostage by Iran barred the hostages from initiating civil suits. However, Congress sought to provide a right of action to those hostages through various proposed laws, which the executive resisted, because of the international implications if such an Accord were to be violated.(52)
Changing circumstances in Iraq also created a difficult situation for the Bush Administration. Under Saddam Hussein, Iraq was a listed state that could be sued. A number of such suits were successful and the plaintiffs sought recovery by seizing certain Iraqi assets. However, after the invasion of Iraq, according to the CRS, the American government no longer had an interest in allowing such assets to be taken, as they wanted them to be used for the benefit of the Iraqi people in rebuilding the country. As such, Iraq was retroactively delisted and many plaintiffs were unable to recover the money granted to them in judgments.(53)
With limited seizable assets in Canada, victims will find themselves competing for the few, if any, assets available for recovery. Furthermore, the concerns outlined above with respect to retaliation appear to have come true in the American situation as equivalent measures have been introduced in Cuba and Iran in response.
The US Experience demonstrates the many challenges in making such a legislative scheme effective in meeting the needs of victims and acting as a deterrent. Some question whether the risk of a future lawsuit will have any impact on terrorists’ behaviour when they are willing to kill to meet their objectives.(54) The refusal of defendants to engage in the process is also a significant barrier. Finally, with likely fewer assets available for seizure in Canada than in the United States, recovery will be even more challenging in this country.(55)
Some commentators such as C-CAT do think such an initiative will be effective. Libya, for example, was facing suits for its support of terrorism when it reached a settlement to pay victims and stopped such support. The suits, in combination with promises to lift economic sanctions, had a positive impact in that case.(56)
The example of Libya shows what can be done with such legislation when the victims’ objectives and the government’s foreign relations objectives are mutually supportive. However, the examples of Iraq and Iran noted above show the challenges that result when those objectives diverge.
* Notice: For clarity of exposition, the legislative proposals set out in the bill described in this Legislative Summary are stated as if they had already been adopted or were in force. It is important to note, however, that bills may be amended during their consideration by the House of Commons and Senate, and have no force or effect unless and until they are passed by both houses of Parliament, receive Royal Assent, and come into force. [ Return to text ]
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