The Supreme Court of Canada ruled Friday that the Canadian government can be held liable for enacting laws that are “clearly unconstitutional,” done in bad faith, or stem from abuse of power.

Chief Justice Richard Wagner and Justice Andromache Karakatsanis, writing for the majority, rejected the state’s argument that Canada has absolute immunity from damages for enacting unconstitutional laws. The court reaffirmed the 2002 Supreme Court of Canada decision in Mackin v New Brunswick, which held that the state only has limited immunity. The majority clarified the immunity threshold as being an enactment that is “clearly unconstitutional,” such that the “lawmakers knew the law was unconstitutional or were reckless or wilfully blind as to its unconstitutionality.” If met, then the state can be held liable for damages.

The court reiterated the importance of damages as a remedy for state violations of the Canadian Charter of Rights and Freedoms.  The court highlighted that section 24(1) of the Charter, allows a court to provide “such remedy as the court considers appropriate and just in the circumstances,” underscoring the necessity to hold the state accountable.

This case arose from a Charter challenge by an individual who had completed his sentence for two criminal convictions. At the time of his conviction, he was eligible to apply for a criminal record suspension five years post-release. A subsequent law enacted by Parliament retroactively made him permanently ineligible. The individual sued for violation of two Charter rights, sections 11(h) and 11(i), and sought damages under section 24(1) of the Charter.

Canada responded by acknowledging the law’s unconstitutionality but claimed absolute state immunity in its legislative powers. Both lower courts upheld the state’s limited immunity as set out in Mackin. Canada then appealed to the Supreme Court, leading to Friday’s ruling affirming and clarifying the limited immunity threshold.

The central issue was the separation of powers between Parliament and the judiciary. The five-judge majority and four dissenting justices disagreed on whether parliamentary privilege was involved. This privilege, among other things, grants absolute immunity to Parliament for conduct that is within their “sphere of activity.” The majority’s view was that this privilege was not implicated, which is why they adopted a limited immunity approach. The dissenting opinions argued that privilege was implicated and that the majority’s decision encroached into Parliament’s “sphere.”

Historically, Canada’s legal order under parliamentary supremacy meant laws passed by Parliament were limited only by jurisdiction. There were virtually no other checks on its power. In 1982, the advent of the Canadian Charter of Rights and Freedoms altered Canada’s legal order into one where Parliament’s power was checked by a constitution that guaranteed fundamental rights. This change established the Constitution as the supreme law of Canada. It tasked the judiciary with guarding Charter rights against state infringement.