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Police - RCMP. Canada v. Hirschfield [disability pensions]
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 deductions from the RCMP disability pensions:[2] The respondent and proposed representative plaintiff Mr. Hirschfield, a Royal Canadian Mounted Police (RCMP) constable, was seriously injured in a car accident while on duty. He was granted a monthly disability benefits pension under the pension scheme for certain disabled members of the Canadian Armed Forces (CAF) and disabled members of the RCMP. He also brought a civil claim for damages, which was ultimately settled for payments totalling $750,000 plus a further sum for costs and disbursements.
[3] As a consequence of the settlement, Veterans Affairs Canada (VAC), which administers the disability pension scheme on behalf of the Minister of Veterans Affairs, advised Mr. Hirschfield that it would offset a portion of his civil damages award against his pension benefits. Its doing so substantially reduced the monthly amount of those benefits (from $865.69 to $41.29) and generated an overpayment of $43,743.80 in benefits already paid, which VAC sought to claw back.
[4] In his statement of claim, Mr. Hirschfield pleads that VAC has wrongfully included amounts for pecuniary damages in calculating the amounts that it offset, and that VAC has done so and is continuing to do so for other disability pension recipients who, along with Mr. Hirschfield, comprise the proposed class. He pleads that VAC’s conduct renders the Crown liable to the proposed class members in systemic negligence, breach of fiduciary duty, and unjust enrichment.
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[8] For the reasons set out below, I would allow the appeal, set aside the certification order, and dismiss the motion for certification. In brief, the essential character of the claims of Mr. Hirschfield and of the other proposed class members brings them squarely within the class of claims over which Parliament has vested exclusive jurisdiction in the VRAB. As a consequence, the Federal Court has no jurisdiction to consider the proposed class members’ claims, the causes of action pleaded in the statement of claim are all doomed to fail, and a class action in the Federal Court cannot be the preferable procedure.
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III. The statutory offset
[26] Section 25 of the Pension Act directs the Minister to reduce a pension recipient’s disability benefits if the recipient has received compensation from certain other sources "“in respect of the same death or disability for which the pension is payable.”" Compensation for this purpose includes "“an amount arising from a legal liability to pay damages”" (paragraph 25(a)) and an amount that is "“payable to or in respect of the pensioner”" under legislation such as a provincial workers’ compensation statute (paragraph 25(b)).
[27] The requirement of an offset in these circumstances has been described as based on "“a principle of fairness”" — that if two members of the forces suffer the same disability, they should each end up with roughly the same compensation whatever its source (amended appeal book at p. 462)—and on the avoidance of "“double recovery”" (100000517721 (Re) (26 November 2002) (VRAB) at pp. 10-12).
[28] Section 26 of the Pension Act prescribes the methodology through which the amount of the offset is determined. The starting point is the "“compensatory amount,”" as calculated in accordance with subsection 26(1): "“the amount remaining, after subtracting any taxes, of the amount collected referred to in paragraph 25(a) or of the compensation payable referred to in paragraph 25(b).”" By subsection 26(2), the amount of the pension reduction is ordinarily the lesser of the pension and one half of the monthly value of the compensatory amount.
[29] Depending on the circumstances and the timing, the calculations may result (as in Mr. Hirschfield’s case) in both a reduction of the monthly value as initially determined and an overpayment that the recipient is required to repay.
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V. VRAB decisions in other cases
[40] Other Pension Act benefits recipients in situations comparable to Mr. Hirschfield’s have brought the "“compensatory amount”" issue before the VRAB for a panel review, and have succeeded in overturning VAC’s decisions. In this appeal, we have been referred to ten cases since 2015 in which they have done so. In each of these proceedings, a VRAB review panel has concluded, based in large part on its adoption of the reasoning of the Federal Court in Manuge, that in calculating the statutory offset only the general damages component of a settlement or judgment, and not the amounts awarded for loss of earning capacity, may be included.
[41] For example, in 100003426931 (Re), 2018 CanLII 50587 (CA VRAB), the review panel stated:The Panel finds that Veterans Affairs Canada (VAC), when computing the amounts owed by the Applicant under Sections 25 and 26 of the Pension Act, erroneously used non-compensatory amounts (wage loss, health care expenses and future and past wage loss) in their calculations.
... [T]he Panel finds that the Honorable Mr. Justice Barnes in the Federal Court case law of Manuge affirms that benefits from VAC are not intended to be a form of an income replacement but rather to “‘provide compensation for reductions in the quality, and sometimes the quantity, of life experienced by the disabled’, and not, as is commonly believed, to provide a form of income replacement.” [42] And in an earlier decision, 100002363092 (Re) (23 October 2015) (CA VRAB), a VRAB panel described as "“now settled law”" the characterization of disability benefits set out in Manuge, and stated that "“[w]age loss, both present and future, is and never was [sic] a part of the raison d’être, the justification, for an award under the Pension Act.”"
[43] Despite these VRAB decisions, VAC has continued to deduct pecuniary amounts in calculating the statutory offset under sections 25 and 26 of the Pension Act. .... . 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. . McMillan v. Canada
In McMillan v. Canada (Fed CA, 2024) the Federal Court of Appeal considered an appeal, this from class action orders from a motion judge of the Superior Court that "dismissed Mr. McMillan’s motion to certify the action as a class proceeding on the basis that his statement of claim failed to disclose a reasonable cause of action" and refused "leave to amend his statement of claim".
Here the court touches on the recent "sexual and non-sexual workplace harassment, discrimination, intimidation and abusive treatment" legal history of the RCMP:VIII. Analysis
[58] Before considering the issues raised by this appeal and cross-appeal, and in order to put Mr. McMillan’s proposed class proceeding into context, it should be noted that the RCMP has come under considerable scrutiny in recent years. Numerous individuals have come forward, alleging that the culture within RCMP workplaces is toxic, and that employees are exposed to sexual and non-sexual workplace harassment, discrimination, intimidation and abusive treatment at the hands of their superiors. These individuals have further alleged that RCMP management has condoned this behaviour, that employees’ attempts to report misconduct were thwarted or not taken seriously, and that employees often faced reprisals for making such reports.
[59] This has led to a significant amount of litigation against the RCMP, including numerous class proceedings brought on behalf of different groups, including the Tiller, Merlo, Ross, Delisle and Greenwood actions referred to earlier. As will be explained below, this Court’s decision in Greenwood is of particular significance for this case.
[60] Concerns with respect to the environment within RCMP workplaces have also resulted in numerous studies and independent reports, the most important of which for our purposes is the Tiller Report. . Lewis v. Canada (Attorney General)
In Lewis v. Canada (Attorney General) (Fed CA, 2023) the Federal Court of Appeal considered an appeal of a JR of a finding of harassment decision by an R.C.M.P. 'Conduct Appeal Adjudicator', under the Royal Canadian Mounted Police Act.
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