Simon's Megalomaniacal Legal Resources

Cabinet (Executive Government) - Spending Power

. Deskin v. Ontario

In Deskin v. Ontario (Div Court, 2023) the Divisional Court considered a JR against a provincial decision which "gave six months notice to the Applicants that payments for therapy that they had been receiving for 15 years for their autistic children (now adults) to fund Applied Behavioural Analysis (“ABA”) (also called Intensive Behavioural Intervention or “IBI”)".

These quotes consider the non-Charter JR-'justiciability' of this issue, which was decided against the applicants on the basis that the decision was not one grounded in a 'statutory power of decision' (neither the predecessor CFSA nor the current CYFSA), but was rather a common law government funding/spending decision which not not judicially-reviewable:

[22] It is the position of the Applicants that the Funding was made under statute, first the Child and Family Services Act, R.S.O. 1990, c. C.11 (“CFSA”) and then the replacement legislation, the Child, Youth and Family Services Act, 2017, S.O.2017, c.14, Sched. 1 (“CYFSA”). Ontario’s position is that the Funding was not granted pursuant to the authority of any statute or contract. Rather, the funding was made by the Ministry under the Crown’s common law spending power, described as “the authority to do anything that it is not legally prohibited from doing.”[7]

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Issue 1: Is the Judicial Review Application, apart from the Charter Claims, Justiciable?

[55] At the hearing, we made a ruling with reasons to follow that apart from the Charter claims, the judicial review application was not justiciable. These are the reasons on the issue of justiciability.

[56] The Applicants submit that the decision is justiciable because the funding was authorized by and developed under statute, in this case s. 7 of the CFSA and then s. 25 of the CYFSA”. They rely on Ministry financial accounts that indicate that the court-ordered funding is a special service within the legislation. They argue that the letter of August 30, 2006 “makes promises that echo in the statutory language.”

[57] Section 7 of the CFSA provides:

Provision of services directly or by purchase

s. 7 (1) The Minister may,

(a) provide services and establish, operate and maintain facilities for the provision of services; and

(b) make agreements with persons, municipalities and agencies for the provision of services,

and may make payments for those services and facilities out of legislative appropriations.

Grants and contributions for services, consultation, etc.

(2) The Minister may make grants and contributions, out of legislative appropriations, to any person, organization or municipality for consultation, research and evaluation with respect to services and for the provision of services.

[58] Sections 25 the CYFSA provides:

Provision of services directly or by others

s. 25 The Minister may,

(a) provide services;

(b) establish, operate and maintain premises for the provision of services;

(c) provide funding, pursuant to agreements, to persons, agencies, municipalities, organizations and other prescribed entities,

(i) for the provision or coordination of services by them,

(ii) for the acquisition, maintenance or operation of premises used for the provision or coordination of services,

(iii) for the establishment of advisory groups or committees with respect to services,

(iv) for research, evaluation, planning, development, co-ordination or redesign with respect to services,

(v) for any other prescribed purpose; and

(d) provide funding, pursuant to agreements, to lead agencies with respect to the performance of the functions referred to in subsection 30(5).

[59] There is nothing in s. 7 of the CFSA or s. 25 of the CYFSA that requires Ontario to provide funding for ABA to the Applicants. Absent bad faith or an improper purpose, the funding decisions of the government are “political” (i.e., policy-based and discretionary), not judicial or “quasi-judicial”, and do not attract judicial review (except under the Charter).[8]

[60] The Applicants submit that the Funding was a stopgap measure and an operational step which was intended to bridge the gap until the parties transitioned into mainstream adult services which then lingered on. They argue that this was not a core policy decision (and therefore arguably not justiciable) because it affected a small group of vulnerable individuals who could not effectively seek redress at the ballot box and it is therefore justiciable. They rely on the factors set out by the Supreme Court of Canada in Nelson v. Marchi, and recently applied by the Court of Appeal for Ontario in Leroux v. Ontario, to argue that “Crown Immunity does not apply.”[9]

[61] Those cases dealt with whether a governmental decision is a “core policy decision” immune from liability in negligence, not whether a decision is susceptible to public law remedies such as certiorari. They are distinct legal frameworks. The “core policy” analysis forms part of the second stage of the Anns/Cooper test for liability in negligence. It has no bearing on an application for judicial review.[10]

[62] In Wise Elephant Family Health Team v. Ontario[11], this court held that a decision to terminate a health clinic’s funding agreement was not justiciable. It cited Paine v. University of Toronto (1981), 1981 CanLII 1921 (ON CA), 34 O.R. (2d) 770 (C.A.), at p. 722:

It is not enough that the impugned decision be made in the exercise of a power conferred by or under a statute; it … must be a specific power or right to make the very decision in issue.

[63] Section 25 of the CYFSA or section 7 of its predecessor legislation, the CFSA, empowers the Minister to provide services and to provide funding pursuant to “agreements”. There is no specific power or right to provide funding for ABA.

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[67] In Hamilton-Wentworth v. Ontario, the Divisional Court held that it is not for the court to oversee the Crown in its discretionary expenditure of public funds. Rather, funding decisions are political, and not judicial, issues.[13] In that case, the government of Ontario made a commitment to the City of Hamilton to contribute 70 per cent of the cost to construct the Red Hill Valley Parkway. The funding allocation was a special commitment outside the Ministry’s normal allocation for the construction and maintenance of existing roads.[14] No contract was signed, but construction was started, and funding provided. In 1990, a new provincial government was elected that declined to continue funding the construction.

[68] On judicial review, the Court held that “the government has the right to order its priorities and direct its fiscal resources towards those initiatives or programs which are most compatible with the policy decisions guiding that particular government’s action. This was simply a statement of funding policy and priorities and not the exercise of a statutory power of decision attracting judicial review.”[15] As a funding decision that was not subject to judicial review, the court had no authority to direct the government to expend funds in any particular way, nor was an undertaking to provide funding binding on future governments.[16]

[69] The principles in Hamilton-Wentworth have been applied in a variety of cases concerning child welfare and the funding of services for persons with disabilities.

[70] Bowman v. Ontario[17] dealt with Ontario’s decision to wind down a pilot project for basic income just one year into the three-year program the prior government had promised. The applicants in that case applied for judicial review, arguing that the decision to cancel the program "had a devastating impact on them and ... as a result of the cancellation, their futures are in jeopardy, their health has suffered, and their futures are uncertain."[18] The applicants in Bowman acknowledged that no legal authority required Ontario to continue funding the project, but argued that cancelling it adversely affected their well-being and that they had relied on the project to their detriment.[19]

[71] The Divisional Court held that the decision to wind down the project was not judicially reviewable, because courts have no authority to review funding decisions. The responsibility for the management of public funds rests with the government and not the court, as does the correctness of the government's decisions and policies. Moreover, the fact that funds were provided in the past does not mean government must continue to offer the same level of service, nor does the decision to reduce or eliminate funding alone create enforceable rights.[20]

[72] In Children’s Aid Society of Huron-Perth, a collection of Children’s Aid Societies (“CAS”) challenged a government decision to reduce funding to the group of CAS. The Court dismissed the application for judicial review, holding that "the government has a right to allocate public funds as it sees fit, and the exercise of that right cannot be the subject of judicial review in the absence of bad faith or for an improper purpose."[21]

[73] Similarly, in Shah v. Ontario, an adult with autism and other developmental disabilities sought judicial review of a Ministry decision not to grant additional funding so that he could live at home. Endorsing the approach of the Court in Hamilton-Wentworth, the Court held that funding decisions were a "question of allocation of scarce resources among the developmentally handicapped persons in the region" and were "not amenable to judicial review."[22]

[74] Likewise, in Kuki v. Ontario, the Ministry of Training, Colleges and Universities had established a skills training program for unemployed individuals. The Court held that the Crown has the authority to establish programs for the benefit of the public as it sees fit, and that programs created outside of statutory authority were not reviewable by the courts.[23] Furthermore, the decision of the Ministry to define eligibility under the program was not reviewable as it was a decision for the disbursement of public funds.[24]

[75] In Metropolitan General Hospital, on judicial review, the Court declined to order the Minister of Health to reinstate funding for hospital beds stating:

10. It follows and has been long held that a Minster cannot be required by mandamus or otherwise to make a particular expenditure ...

13. ... The Minister has filed much material to justify the merits of his decision but I make no comment upon it or upon the case presented by the applicant because in my view it is not for me or any Court to oversee the Minister in his policy decisions or in the exercise of his discretion in the expenditure of public funds entrusted to his Department by the Legislature...the wisdom of the decision can never be the subject of judicial review. It is a political and not a judicial problem. [25]

[76] The decision in Hamilton-Wentworth and the decisions which have applied it are the appropriate authorities to consider in this case. I disagree with the Deskin Applicants’ submission that Tesla Motors Canada ULC v. Ontario (Ministry of Transportation) [Tesla][26] supports the justiciability of the Decision. Tesla confirms that purely political matters like a decision to cancel a subsidy program are not subject to judicial review. A cabinet decision to exclude Tesla from the program was found to be justiciable due to bad faith in singling out Tesla to be excluded without providing any opportunity to be heard or any fair procedure whatsoever. These facts are distinguishable from the facts in this case where bad faith is not alleged.

[77] Here, after the Ontario Court of Appeal in Wynberg dismissed the Applicants’ claims, the Ministry undertook during the transition to adult mainstream services to temporarily continue the funding they had been receiving pursuant to the interlocutory court order. The Funding was not mandated under any statute. The general provisions of the CFSA or the CYFSA cited by the Applicants do not require that the Minister maintain the Funding for the Applicants. Rather, the Funding was a discretionary expenditure outside the Ministry’s normal allocation for adult developmental disabilities, not the exercise of a statutory power of decision attracting judicial review. The decision to reduce or eliminate funding alone does not create enforceable rights.[27]

[78] The government has the right to order its priorities and direct its fiscal resources towards those initiatives or programs which are most compatible with the policy decisions guiding that particular government’s action. In these circumstances, the court has no authority to direct the government to expend funds in any particular way. Absent bad faith or an improper purpose which is not alleged or supported by the evidence, Ontario’s Decision to discontinue the Funding (apart from the Charter claims discussed below) is not justiciable.

. Metropolitan Preparatory Academy Inc v. Ontario

In Metropolitan Preparatory Academy Inc v. Ontario (Div Court, 2022) the Divisional Court held that government financial/policy allocation decisions were non-justiciable, here in an Ontario judicial review context:

[18] “[R]esponsibility for the management of public funds rests with the government and not the court…” (Bowman v. Her Majesty the Queen, 2019 ONSC 1064, para. 40). Expenditures of public funds are discretionary public policy decisions made by government pursuant to the Crown’s common law spending powers: Pharmaceutical Manufacturers Association of Canada v. British Columbia (Attorney General) (1997), 1997 CanLII 4597 (BC CA), 149 DLR (4th) 613, paras. 27-29 (BC CA).

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[28] Finally, we note that the applicants and their employees were eligible to seek funding under several programs targeted at businesses and as support for working people to relieve some financial consequences of public health measures taken in response to COVID-19. There is no unfairness in Ontario taking different approaches to addressing issues arising in the private sector and issues arising in publicly funded institutions.