Simon's Megalomaniacal Legal Resources

Military - Veterans Review and Appeal Board (VRAB)

. Canada v. Hirschfield

In Canada v. Hirschfield (Fed CA, 2025) the Federal Court of Appeal allowed an appeal, this from a granted certification decision regarding RCMP officers who both were eligible for a disability pension and civil damages, and to whom Veterans Affairs Canada (VAC) "offset a portion of ... civil damages award against his pension benefits".

Here the court usefully sets out criteria for determining when a tribunal has exclusive procedural jurisdiction over a matter, and when "the essential character of a claim renders it subject to that machinery":

[52] ... In my view, both errors are rooted in the failure of the motion judge to fully address the terms of the regulatory scheme governing the benefits in issue—in particular, the exclusive jurisdiction that it confers on the VRAB—and the "“essential character”" (or, as it is sometimes expressed, the "“essential nature”") of Mr. Hirschfield’s claim.

[53] As the Supreme Court stated in Vaughan v. Canada, 2005 SCC 11 at para. 26, "“[w]hen a benefit is conferred by statute or regulation, the conferring legislature is entitled to specify the machinery for its administration [...], subject to a dissatisfied party having recourse to judicial review”" (citation omitted).

[54] Where the legislature has so specified, and the essential character of a claim renders it subject to that machinery, it is through that machinery that the claim should be determined. "“[T]hat an administrative tribunal should decide all matters whose essential character falls within the tribunal’s specialized statutory jurisdiction, is now a well-established principle of administrative law:”" R. v. Conway, 2010 SCC 22 at para. 30 (emphasis in original).

[55] As discussed in detail above, here Parliament has specified "“machinery”" to govern entitlement to the disability pension benefits in issue: it has specified that the benefits are to be administered in the first instance by VAC, and then, if necessary to resolve a dispute, by the VRAB—fully and exclusively—subject only to judicial review.

[56] Therefore, as stated in Regina Police Assn. Inc. v. Regina (City) Board of Police Commissioners, 2000 SCC 14 at para. 39,

[t]he key question […] is whether the essential character of [the] dispute, in its factual context, arises either expressly or inferentially from a statutory scheme. In determing this question, a liberal interpretation of the legislation is required to ensure that a scheme is not offended by the conferral of jurisdiction not intended by the legislature.

[57] This test has been applied in a wide variety of contexts, including, among others, in labour relations (where the seminal case is Weber v. Ontario Hydro, 1995 CanLII 108 (SCC), [1995] 2 SCR 929 at paras. 52-53); in taxation matters (see Merchant Law Group v. Canada Revenue Agency, 2010 FCA 184); in the immigration context (see Leahy v. Canada (Citizenship and Immigration), 2020 FCA 145); in workers’ compensation matters (see Gill v. WorkSafeBC, 2017 BCCA 239); and in the context of statutory insurance benefits (see Stegenga v. Economical Mutual Insurance Company, 2019 ONCA 615). It applies whether the claim is put forward in a proposed class proceeding or in an individual action: see, for example, Merchant at para. 40; Canada (Attorney General) v. Scow, 2022 BCCA 275 at para. 85.

[58] The rationale in the labour cases "“involves the recognition by the courts that they ought not intervene in the field of labour relations, where specialized tribunals have been established by legislators for settlement of disputes”": Canada v. Greenwood, 2021 FCA 186 at para. 129, leave to appeal refused, 2022 CanLII 19060.

[59] A similar rationale prevails in the cases—Merchant being one example—in which the question to be considered has been whether, given their essential character, the claims in issue were properly within the purview of the ordinary courts or of the Tax Court of Canada. For example, in Canada v. Addison & Leyen Ltd., 2007 SCC 33, where a taxpayer attempted to circumvent the jurisdiction of the Tax Court by launching an application for judicial review in the Federal Court, the Supreme Court held (at para. 11) that the application could not succeed: the taxpayer was obliged to seek relief within the system of tax assessments and appeals that Parliament has established:

The integrity and efficacy of the system of tax assessments and appeals should be preserved. Parliament has set up a complex structure to deal with a multitude of tax-related claims and this structure relies on an independent and specialized court, the Tax Court of Canada.

[60] Similar considerations apply where a claimant under a statutory benefit scheme attempts to bypass a tribunal established as part of that scheme and resort to the ordinary courts. For example, in Davis v. Workers’ Compensation Appeal Tribunal, 2013 BCCA 418 at paras.10-11, the Court of Appeal for British Columbia rejected the appellant’s contention that she had a right to have her compensation claim determined by a civil jury. It noted that the right to compensation "“is statutory, and it is the statute that determines how benefits are to be assessed. The statute prescribes a detailed administrative scheme for assessment of compensation, and specifically provides […] that the WCAT has exclusive jurisdiction to review compensation decisions […].”"

[61] How then is the essential character or nature of a claim to be determined?

[62] In Canada v. Domtar Inc., 2009 FCA 218 at para. 28, this Court answered that question as follows:

The correct approach to the determination of the essential nature of a claim is established by the decision of this Court in Canada v. Roitman, 2006 FCA 266, [leave to appeal refused, 2006 CanLII 41274]. That case stands for the proposition that in determining whether a court has the jurisdiction to entertain a claim [or whether jurisdiction rests with another court or tribunal], the question of the essential nature of the dispute must be based on a realistic appreciation of the practical result sought by the claimant. This was explained by Justice Décary, writing for this Court in Roitman (at paragraph 16):

A statement of claim is not to be blindly read at its face meaning. The judge has to look beyond the words used, the facts alleged and the remedy sought and ensure himself that the statement of claim is not a disguised attempt to reach before the Federal Court a result otherwise unreachable in that Court.

[63] In Roitman, the claimant brought an action in the Federal Court, framed as a claim for damages for misfeasance in public office. The claimant alleged that the Minister of National Revenue had deliberately issued a notice of assessment of income tax knowing that the assessment was based on an incorrect interpretation of the law. The claim was struck out because despite its form as a claim for damages, it was essentially a challenge to the legal correctness and validity of an income tax assessment, a matter that, by statute, was within the exclusive jurisdiction of the Tax Court of Canada.

[64] This Court followed Roitman in Domtar. There Domtar had commenced an action in the Federal Court for a declaration that a provision of federal legislation enacted as part of the settlement of the softwood lumber dispute with the United States was unconstitutional, and an order requiring the Crown to repay Domtar the some $37 million it had paid under that provision, together with interest and costs. The legislation provided a procedure for claiming a refund of an amount paid, and a notice of assessment, objection, and appeal procedure similar to the procedure for claiming a refund of income tax paid. The appeal was to the Tax Court of Canada. Domtar did not file an application for a refund before the time provided for doing so expired.

[65] The Crown moved to strike out Domtar’s statement of claim, submitting that the claim was essentially for recovery of the money Domtar had paid under the legislation. In response, Domtar argued that its claim was in essence for a declaration of unconstitutionality, and that the monetary claim was only an ancillary remedy.

[66] The Court held (at para. 28) that Roitman had set out the correct approach to the determination of the essential nature of a claim—it must be "“be based on a realistic appreciation of the practical result sought by the claimant.”" Applying that approach, it went on (at para. 30):

[T]here is no doubt that Domtar’s principal objective is to receive a return of the amount it paid pursuant to [the statutory provision]. There is no reason to believe that Domtar would be pursuing its claim unless it had the prospect of recovering that money. For that reason, I accept the argument of the Crown that essentially, Domtar is asserting a claim for a refund of money paid under the [Act]. That is the essential nature of its claim even though the claim is based on a constitutional challenge.

[67] Given that conclusion as to the essential nature of the claim, the Court concluded that the Tax Court had exclusive jurisdiction in respect of it under the Tax Court of Canada Act, R.S.C. 1985, c. T-2, which ousted the jurisdiction of the Federal Court over matters arising under the softwood lumber legislation.

[68] This Court’s decision in Merchant is also helpful in considering the essential character of the claims here. Merchant was a proposed class action, brought in the Federal Court by two law firms and four of their clients. They alleged that the Canada Revenue Agency should not have required the law firms to collect or remit GST on certain disbursements. They sought repayment of the amounts of GST that they alleged they should not have had to pay. They pleaded two common law causes of action, misfeasance in public office and restitution, and also claimed aggravated and punitive damages.

[69] The Federal Court struck out their statement of claim, for several reasons. One was that the cause of action in restitution was not available: Part IX of the Excise Tax Act, R.S.C. 1985, c. E-15, established a scheme for obtaining rebates of tax that was not payable, and that scheme ousted any common law cause of action. A second was that the claim had been brought in the wrong court: while the action was commenced in the Federal Court, the Tax Court had been given exclusive jurisdiction to hear appeals relating to the recovery of money collected as GST.

[70] This Court upheld the Federal Court’s decision on both grounds. It found that the proposed class action was properly characterized as an attempt to recover GST outside Part IX of the Excise Tax Act, and was therefore barred. In coming to this conclusion, the Court compared the compensatory relief sought in the proposed class action to the compensatory relief obtainable under the statute. It found it to be the same. It then considered whether the claim for aggravated and punitive damages affected the correctness of that conclusion. It found that it did not. The appellants were not seeking compensatory damages for the misconduct that they alleged. Their claim "“[still sought] the recovery of GST outside of the Act, but with an added penalty due to the respondents’ conduct”" (Merchant at para. 26).

[71] The Supreme Court has approved and adopted the essential character test for purposes of determining the jurisdiction of the Federal Court: Windsor (City) v. Canadian Transit Co., 2016 SCC 54 at paras. 26-27. In doing so it compendiously restated the test as follows (citations omitted):

The essential nature of the claim must be determined on “a realistic appreciation of the practical result sought by the claimant” […]. The “statement of claim is not to be blindly read at its face meaning” […]. Rather, the court must “look beyond the words used, the facts alleged and the remedy sought and ensure ... that the statement of claim is not a disguised attempt to reach before the Federal Court a result otherwise unreachable in that Court”.

....

[74] Roitman and the other cases discussed above tell us that in determining the essential character of a claim, we must look beyond the words used, the facts alleged, and the remedy sought. When we do so here, it is apparent in my view that the essential character of Mr. Hirschfield’s claims is to recover amounts that, it is asserted, should have been paid and should continue to be paid under the Pension Act, but (as in Merchant), "“with an added penalty due to the respondents’ conduct.”"

[75] It is also apparent, in my view, that Parliament has sought to confer on the VRAB, in sections 18 and 26 of the VRAB Act, a broad authority—described as "“full and exclusive jurisdiction”—"to deal with applications and appeals brought in pursuit of claims of this kind, and "“all matters related to”" those applications and appeals.

[76] Mr. Hirschfield did not suggest in argument that the word "“exclusive”" as enacted by Parliament in the VRAB Act bears any meaning other than its ordinary meaning. That ordinary meaning includes "“excluding (some other) from participation”" in English ((Oxford English Dictionary (December 1, 2024), sub verbo "“exclusive”", online: ) and "“qui appartien[t] à une seule personne”" in French (Le Robert Dico en ligne, (December 1, 2024), sub verbo "“exclusif”", online: < https://dictionnaire.lerobert.com/definition/exclusif >).

[77] While contextual factors must, of course, still be considered, I see no contextual factors here that call for expanding or limiting the ordinary meaning of "“exclusive.”"

[78] It follows that Mr. Hirschfield’s claims and those of other proposed class members come within the" “full and exclusive jurisdiction”" of the VRAB, and that they may not be adjudicated—except by way of judicial review following a decision of the VRAB—in the Federal Court. It is self-evident that a procedure the Court has no jurisdiction to hear and determine cannot be a preferable procedure. In concluding (at paras. 69 to 75 of his reasons) that a class action would be the preferable procedure and that the VRAB would not be an adequate alternative, the motion judge erred in law in failing to address the breadth and exclusivity of Parliament’s conferral of authority on the VRAB, and their consequences for the jurisdiction of the Federal Court. Those consequences, in my view, are dispositive of this appeal.

. Canada v. Hirschfield [pensions and VRAB]

In Canada v. Hirschfield (Fed CA, 2025) the Federal Court of Appeal allowed an appeal, this from a granted certification decision regarding RCMP officers who both were eligible for a disability pension and civil damages, and to whom Veterans Affairs Canada (VAC) "offset a portion of ... civil damages award against his pension benefits".

Here the court considers the history, and the location of, the RCMP disability pension regime under the Veterans Review and Appeal Board (VRAB) tribunal system:

II. The disability pension benefits scheme

[10] Mr. Hirschfield’s claim relates to the administration and adjudication of entitlement to disability pension benefits. These benefits were first provided under legislation enacted in 1919. They are now provided under Part III of the Pension Act, R.S.C. 1985, c. P-6. Their recipients are members and veterans of the CAF and the RCMP, and their eligible survivors and dependants. (I should note that the benefits scheme in issue in this case has been superseded, effective for claims arising in and after April 2006, by the scheme set out in the Veterans Well-being Act, S.C. 2005, c. 21. This appeal does not engage that scheme.)

[11] Applications for disability pension benefits under the Pension Act are made to "“the Minister”"—in practical terms, to VAC. In accordance with section 35 of the Pension Act, VAC determines the amount of a disability pension based on the degree to which an applicant’s condition is related to the applicant’s service and VAC’s assessment of the extent of the disability. Pension benefit recipients receive non-taxable monthly disability pension benefits for life. A death payment and survivor’s benefit may also be paid.

[12] An applicant who is dissatisfied with a VAC decision may request that it review the decision based on new evidence. There is no limit on the number of VAC reviews an applicant may request on this basis, and no limitation periods apply.

[13] By section 84 of the Pension Act, an applicant who is not satisfied with the results of a VAC decision, whether an initial decision or a decision made after a review, may apply to the VRAB for a review of the decision. Again, no limitation periods apply.

[14] The VRAB was established by the VRAB Act as an independent tribunal. Its members are appointed by the Governor in Council. Section 18 of the VRAB Act sets out the VRAB’s jurisdiction in respect of applications for review. It gives the VRAB, as noted above, "“full and exclusive jurisdiction to hear, determine and deal with all applications for review that may be made to the Board under the Pension Act […] and all matters related to those applications”" (in the French version, "“compétence exclusive pour réviser toute décision rendue en vertu de la Loi sur les pensions […] et pour statuer sur toute question liée à la demande de révision”").

[15] By section 19 of the VRAB Act, an application for review is to be heard by a review panel of at least two members of the Board. By section 20, an applicant may present evidence and arguments to the review panel either by written submission or in person.

[16] By section 35, applicants for review are entitled to free legal advice and representation from the Bureau of Pensions Advocates — an organization of lawyers within VAC who specialize in reviews and appeals related to claims for illness and disability benefits. Applicants may also choose to be represented by a service bureau of a veterans organization, or at their own expense by another representative of their choice.

[17] Regardless of whether and, if so, by whom an applicant is represented, the proceedings before a review panel, unlike proceedings typically held before courts and other tribunals, are ordinarily non-adversarial. Except where the VRAB has specifically given notice relating to a question of statutory interpretation (as discussed below), VAC is not entitled to participate in proceedings before the panel, and no one appears to defend the VAC decision or argue against the applicant’s position. In addition, section 39 of the VRAB Act obliges the VRAB, like VAC, to give the applicant the benefit of the doubt: among other things, to draw from all the circumstances of the case and all the evidence presented to it every reasonable inference in favour of the applicant or appellant, and to resolve in favour of the applicant or appellant any doubt, in the weighing of evidence, as to whether the applicant or appellant has established a case.

[18] By section 21 of the VRAB Act, a review panel may affirm, vary, or reverse VAC’s decision, refer any matter back to VAC for reconsideration, or refer any matter not dealt with to VAC for decision. Subsection 23(1) authorizes a review panel, on its own motion, to reconsider a decision and either confirm it or amend or rescind it if it determines that an error was made with respect to any finding of fact or the interpretation of any law. Consistent with the overall approach of the legislation, no limitation period is prescribed.

[19] By section 25, an applicant who is dissatisfied with a decision of a review panel has a right of appeal to the VRAB. Section 26 confers on the VRAB "“full and exclusive jurisdiction to hear, determine and deal with all appeals that may be made to the Board under section 25 […] and all matters related to those appeals”" (in the French version, "“compétence exclusive pour statuer sur tout appel interjeté en vertu de l’article 25, […,] ainsi que sur toute question connexe”)." By subsection 27(1), an appeal is to be heard by a panel of the VRAB comprising at least three members, who must be different from the members of the review panel. Yet again, no limitation period applies.

[20] By subsection 28(1), an appellant may make a written submission to the appeal panel or appear before it in person or by representative. Like review proceedings, appeal proceedings are non-adversarial: VAC is, again, ordinarily not entitled to participate in proceedings before an appeal panel, and the appellant may, again, be represented in the same manner as in a VRAB review. Subsection 29(1) of the VRAB Act authorizes an appeal panel to affirm, vary or reverse the decision under appeal, refer any matter back to the person or review panel that made the decision for reconsideration, re-hearing or further investigation, or refer any matter not dealt with in the decision back to that person or review panel for a decision.

[21] By section 31, "“[a] decision of the majority of members of an appeal panel is a decision of the Board and is final and binding.”"

[22] However, by subsection 32(1), an appeal panel may on its own motion reconsider a decision made by it and confirm, amend, or rescind the decision if it determines that an error was made with respect to any finding of fact or the interpretation of any law, or may do so on application if the appellant alleges that an error was made with respect to any finding of fact or the interpretation of any law, or if new evidence is presented.

[23] Section 30 and subsection 37(1) of the VRAB Act provide specific mechanisms for the resolution of questions of statutory interpretation.

[24] By section 30, where an appellant raises a question of interpretation relating to the VRAB Act or certain other statutes, including the Pension Act, the VRAB may notify the persons or organizations prescribed in the Prescribed Persons and Organizations Regulations, S.O.R./96-68 (which include the Minister of Veterans Affairs, the Bureau of Pensions Advocates, and veterans organizations including the Royal Canadian Legion), and give them an opportunity to present arguments on the question before it makes a decision. By subsection 37(1), the Minister, the Chief Pensions Advocate (the executive director of the Bureau of Pensions Advocates), veterans organizations, or any interested person, may refer to the VRAB for a hearing and decision any question of interpretation relating to the VRAB Act or the Pension Act, among other statutes.

[25] Decisions of the VRAB, like those rendered by many other federal tribunals, are subject to judicial review by the Federal Court: Federal Courts Act, R.S.C. 1985, c. F-7, ss. 2, 18, 18.1. In addition, subsection 18.3(1) of that statute authorizes the VRAB, like other federal tribunals, to refer at any stage of its proceedings any question or issue of law, of jurisdiction or of practice and procedure to the Federal Court for hearing and determination.