Class Action Forces CIC to Abandon Retroactivity by gdf57j


									                  Class Action Forces CIC to Abandon Retroactivity

By Adam M. Dodek* (

On September 18, 2003 at 10:00 a.m. retroactivity came to an abrupt halt.          That morning,
Minister of Citizenship and Immigration Denis Coderre appeared before the press to announce
that he intended to amend the transitional regulations of the Immigration and Refugee Protection
Regulations to allow for all skilled worker and business immigration applicants who applied
before January 1, 2002 to be assessed under the selection criteria of the former Immigration Act.
He further announced that Applicants who do not qualify under the former Act would then be
assessed under the current Immigration and Refugee Protection Act (“IRPA”). Retroactivity was

The reason for Citizenship and Immigration Canada’s (“CIC”) reversal was apparent on the face
of the Minister’s Press Release which quoted the Minister as saying: “The government’s clear
intention has always been to treat applicants fairly . . . That is why we introduced and then
extended transition measures. The court has suggested that more is required of the government.
I have listened to that message. That is why I am proposing these changes today.” In short, the
Minister retreated under the pressure of litigation.

This article tells the story of that litigation, which has yet to be settled, and explains how it
succeeded in killing retroactivity.

The Birth of Retroactivity

The Immigration Act, R.S.C. 1985, c. I-2 (the “former Act”) and the Immigration Regulations,
1978 were repealed in 2002 and replaced by the IRPA and the Immigration and Refugee
Protection Regulations (“IRPR” or the “new Regulations”), effective June 28, 2002.      Since the
former Act was in force, CIC had always represented to applicants for permanent residence that
if there are changes made to the Act, applicants would be assessed in accordance with the rules
in place at the time that they submitted their application. The retroactive application of the new
Act and the new Regulations was unprecedented for CIC. This was confirmed by Robert Orr,

CIC's Acting Director General of International Region, on cross-examination as part of the Stay
Motion which is discussed in more detail below.

The story of the enactment of the final version of the new Regulations and the testimony of CIC
officials before the House of Commons Standing Committee on Citizenship and Immigration
will be well-known to many readers of this newsletter.         It was documented in great detail by
Kelen J. in Dragan v. Canada (Minister of Citizenship and Immigration), [2003] F.C.J. No. 260,
2003 FCT 211 (“Dragan”). In a nutshell, in response to criticism from many witnesses about the
unfairness of the retroactive effect of the regulations, the Minister agreed to move the deadline
for reviewing applicants under the old selection criteria from January 1, 2003 to March 31, 2003.
Of critical import, CIC officials had testified before the Committee that they estimated that they
would be able to process 90,000 of the 120,000 applicants by January 1, 2003. Based on these
representations, the Committee recommended to the Minister that the processing of applications
received before January 1, 2002, should be extended until March 31, 2003.            Extending the
deadline to March 31, 2003 was supposed to result in virtually all of the cases in the backlog
being processed by the Minister by that date. This is not what transpired.

By late 2002, it became apparent to immigration lawyers that CIC was not making any special
efforts to process the applications in the backlog and many thousands would be left stranded in
the backlog.

Administrative Deadlines

Indeed, during the course of the class action litigation, we discovered that as early as July 2002 –
only a month after the final Regulations were enacted -- visa offices around the world began
sending letters to applicants for permanent residence, including those that applied prior to
January 1, 2002 (the “pre-January 2002 Applicants”). In these letters CIC informed applicants
that it would not be able to schedule an interview for them before April, 1, 2003 and therefore
their applications would be assessed under IRPA.

The Dragan Decision

On February 21, 2003, Kelen J. of the Federal Court issued his decision i Dragan, granting a
writ of mandamus in 102 cases requiring the Minister and his officers, on or before March 31,
2003, to assess the 102 applications and award units of assessment in accordance with the former
Regulations. The Minister appealed the decision of Kelen J. to the Federal Court of Appeal.

All of the 102 successful applicants in Dragan applied for permanent residence in Canada before
January 1, 2002. They applied with the expectation that they would be assessed according to the
selection criteria contained in the former Regulations.        Their applications had been paper
screened but they had not received an interview.

In granting the writs of mandamus, Kelen J. found that the Minister ignored the Committee’s
recommendations and further found that the Minister had a statutory duty to process the pre-
January 2002 Applications at issue before him.

Launching the Class Action

The decision in Dragan took the bar by surprise. It spurred the filing of thousands of judicial
review applications in advance of the March 31, 2003 deadline under the transitional regulations.
At Borden Ladner Gervais LLP, we had a number of clients in the same position as the
successful applicants in Dragan – persons who had applied for permanent residence before
January 1, 2002, whose applications had been paper screened but had not received an interview.
We decided to launch a class action to protect not only their rights but the rights of the
approximately 80,000-120,000 other similarly-situated applicants.

The Federal Court’s Class Action Rules (Rules 299.1 to 299.42) are new; they came into effect
in November 2002. There was no precedent to follow for launching a class action in Federal
Court.   The class action rules only applied to “actions” and because we sought mandamus to
compel the Minister to assess the class members in accordance with the selection criteria under
the old Act, we had to seek judicial review.        Under IRPA, leave is now required for judicial
review applications.   We therefore launched two applications for leave and for judicial review:

Anand v. M.C.I. (IMM-2282-03) and Rasolzadeh v. M.C.I. (IMM-2286-03). At the same time,
we began to collaborate with Lorne Waldman who launched Dass v. M.C.I. (I.M.M-2280-03).

The point of a class action is to obtain relief for a class of persons who have common issues. It
provides    a   cost-efficient manner to litigate the common issues using one or more
“representative” plaintiffs. Messrs. Anand, Dass and Rasolzadeh were representative of the class
of persons caught in the backlog on whose behalf we sought relief. They had all applied before
January 1, 2002, they had all been paper screened and they had all not received an interview.
Messrs. Dass and Rasolzadeh are both skilled workers who had a good chance of success under
the former selection criteria but were likely to fail under IRPA. Mr. Anand was a self-employed
applicant with a reasonable chance of success under the old Act but almost destined to fail under
IRPA because of the elimination of the self-employed category.

In our applications for leave and for judicial review, we sketched out in detail our class action
plan. First, we sought leave for the applicants to commence a judicial review. Second, if leave
was granted, we intended to convert these applications to actions. Third, after conversion, we
would seek certification of the actions as a class action with Messrs. Anand, Rasolzadeh and
Dass as representative plaintiffs. With respect to the relief, we sought mandamus to compel the
Minister to assess the applicants and the class based on the old selection criteria.        In the
alternative, we sought damages for the members of the class in the amount of $400 million for
breach of statutory duty, breach of contract, negligence, breach of fiduciary duty, breach of duty
of fairness and unjust enrichment.       In addition to relying on administrative law regarding
mandamus, we also sought to rely on the Bill of Rights and the Canadian Charter of Rights and

Case Management

By the beginning of April 2003, nearly 80 cases, involving some 5500 applicants/plaintiffs had
been filed by 10 counsel in the Federal Court. All were placed under the case management of
Justice Frederick Gibson of the Federal Court.         Beginning on April 25, 2003, a series of
teleconferences were held involving counsel for the applicants/plaintiffs, counsel for the Minister
and Justice Gibson.

At the first teleconference, counsel for the Minister, Cheryl Mitchell (Department of Justice –
Vancouver) argued that all of the matters under case management should be held in abeyance
pending the disposition of the Dragan appeal.             Ms. Mitchell argued that the Dragan appeal
would likely resolve many of the issues in the cases under Justice Gibson’s management and that
the Minister would be seeking an expedited appeal (an earlier motion before Rothstein J.A. was
brought in March 2003 and had failed on the grounds that the appeal could not be heard and
decided before the expiry of the transition period on March 31, 2003). Justice Gibson raised two
problems with holding all of the cases in abeyance pending the Dragan appeal: first, there was a
concern over the possible mootness of the appeal, given that the Minister had fully complied
with the order of Kelen J.; and second, there was the possibility of an appeal from the Court of
Appeal to the Supreme Court of Canada, in any event.               Ronald Foerster of Borden Ladner
Gervais, solicitors for Messrs. Anand and Rasolzadeh, articulated one of the chief concerns of
the applicants: “I am a bit concerned about [the Dragan] appeal being defended by people who
no longer have any real interest in the matter.”           This concern was echoed by other counsel.
Concern was also expressed about the inequity of staying the litigation while the Minister
continued to asses the litigants under IRPA, potentially to their great detriment. Lorne Waldman
first raised his intention to bring a motion to stay the Minister’s administrative process of these
applicants.   The Court also raised the issue of proceeding with “test leaves” – choosing a
representative sample of 5-10 applications for leave to commence judicial reviews which would
serve as test cases to help narrow the issues in the several thousand judicial reviews.

Slaying the Dragan

After the first teleconference, it became apparent that the Minister’s strategy was two-fold. On
one front, he would press ahead with the Dragan appeal, even in the absence of any incentive for
the respondents in that appeal to fully litigate the issues, in the hope that the Federal Court of
Appeal would fnd in its favour and as a result put an end to most of the litigation in the Federal
Court under the case management of Justice Gibson. At the same time, the Minister would press
ahead with evaluating those in the backlog under the new selection criteria under IRPA, reducing
the backlog by negative decisions against those who could not qualify under IRPA.

We therefore needed to combat the Minister on both fronts.

On the Dragan front, the Minister brought a new motion to expedite the appeal returnable May
13, 2003 before Rothstein J.A.       Counsel for the Respondents in the Dragan appeal retained
Lorne Waldman to bring a motion to quash the appeal on the grounds of mootness. We sought
leave to intervene on behalf of Messrs. Anand and Rasolzadeh on the mootness motion. We
made the decision to seek leave to intervene on this motion because we felt that we had to do
everything in our power to attempt to quash the Dragan appeal. Moreover, since the respondents
in the Dragan appeal had obtained all the relief that they sought (all interviews had been
completed by March 31, 2003 in compliance with the Order of Kelen J.) and had not cross-
appealed on any other issue, they no longer had any interest or incentive to litigate the appeal.
Rather, the only parties with an interest in the outcome of the Dragan appeal, aside from the
Minister, were the applicants/plaintiffs in cases under Justice Gibson’s management.   We feared
that if the Dragan appeal was not quashed, we would be forced to intervene on the merits of the
appeal in order to protect our clients’ interests and the interests of the prospective class. We
would then be forced to litigate on two fronts: in the Court of Appeal in Dragan and in the
Federal Court with Justice Gibson.

The motions to expedite and to quash were set for May 13, 2003 in Toronto. At the outset of the
hearing, Justice Rothstein expressed doubt as to whether a single judge of the Court had
jurisdiction to quash an appeal. Justice Rothstein adjourned the mootness motion to be heard by
a three judge panel of the Court but heard argument on the Minister’s motion to expedite the
appeal and our motion for leave to intervene on the mootness motion. He granted the Minister’s
motion to expedite the appeal and he granted our motion for leave to intervene on the mootness

As an important aside, it was through this motion that we discovered the size of the backlog. As
set out in the Minister’s motion materials, there were still 104,000 people in backlog who had
applied before January 1, 2002.       Given the testimony of the CIC representatives before the
House of Commons Committee about their ability to process the backlog, this number was

The mootness motion was heard on May 22, 2003 in Ottawa before Rothstein, Sexton and
Sharlow JJ.A.    Again, Mr. Waldman appeared for the respondents on the appeal and Urszula

Kaczmarcyk appeared for the Minister; I appeared on behalf of the interveners. The Court
determined that the appeal was technically moot and refused to exercise its discretion to heard
the appeal, despite its mootness: see 2003 FCA 233, [2003] F.C.J. No. 813. The Dragan had
been slain.

The Stay Motion

Counsel spent a good deal of time discussing the need to do something to attempt to stop the
Minister from continuing to process persons under IRPA who had applied under the old Act.
The Minister had sent what we called “IRPA letters” to persons giving them 2, 3, 4 months to
submit new application forms and new information under IRPA or their applications could be
rejected.     The deadlines were rolling ones, but many counsel had clients with July 1, 2003
deadlines. Our fear was that with the litigation proceeding at a slow pace, the Minister would be
able to substantially diminish the size of the class by rejecting people under IRPA, before we
ever got to certification. Once rejected, these persons were likely to give up on Canada and may
be difficult to reach if and when certification was achieved.

Dan Miller brought a motion in Borisova on behalf of other applicants and also sought an order
with respect to all those applicants who had applied before June 28, 2002, the date that IRPA
came into effect. We wrestled for weeks over how to frame the motion in order to have the
greatest chance of success. We sought a stay for the 104,000 pre-January 2002 applicants. We
also discovered an obscure provision of the new class action rules which empowered the judge to
order “pre-certification notice”. In the normal course, notice is given to the class members only
after certification.   This makes sense because it was only upon certification that the class is
defined and approved by the Court. However, Rule 299.37 of the Federal Court Rules seemed to
provide for notice in a situation such as ours. Entitled “Notice to others” it provides simply that
“A judge may, at any time, order any party to give any notice that the judge considers necessary
to protect the interests of any class members or party or to ensure the fair conduct of the
proceedings.” Similar provisions in the B.C. and Ontario class action statutes had been used to
order pre-certification notice, but never to 100,000 persons.

The motion was heard on June 16, 2003 by Gibson J. Dan Miller appeared for the Borisova
applicants, Ronald Foerster and Lorne Waldman appeared for the Anand/Dass/Rasolzadeh
applicants and Urszula Kaczmarcyk of the Department of Justice appeared for the Minister.
Denis Tanack, Lawrence Wong and Richard Kurland appeared as interveners on the motion by

There were a number of important issues canvassed during the day’s argument: the court’s
jurisdiction to issue the requested orders; the legal arguments in support of the serious issue to be
tried prong of the stay; and the balance of convenience.             However, the critical issue was
irreparable harm. On this issue, we were able to use the Minister’s own evidence against him.
The Minister’s evidence was that the pre-January 2002 applicants were being sent letters and
given the opportunity to submit new information and documents in order to be assessed under
IRPA. In his affidavit sworn June 12, 2003, in support of the Minister’s response to our motion,
Robert Orr, the Acting Director General of International Region of CIC, explained at great length
in his affidavit why the Minister needed to request new information from applicants.

In fact, during the course of our motion, evidence came to light from Denis Tanack that the
Minister had begun rejecting pre- and post-January 2002 applications without requesting further
information. Gibson J.’s comments on this issue during the course of the hearing cut to the heart
of the issue: there was quite a gap between the instructions from Ottawa and the reality of what
was happening in the field.

Four days after the motion was heard, on Friday, afternoon, June 20, 2003, Gibson J. granted our
motion and ordered the Minister to refrain from finally rejecting any of the pre-January 2002
Applications, subject to certain exceptions. Gibson J. also ordered the Minister to send a notice
to the 104,000 pre-January 2002 applicants advising them of his Order and the status of their
Applications.   His reasons were released on July 11, 2003 and now reported as Borisova v.
Canada, [2003] F.C.J. No. 1114 (F.C.).

The Minister’s Announcement on the Retreat from Retroactivity

On September 18, 2003, the Minister issued a Press Release announcing his retreat on
retroactivity. The “Backgrounder” appended to the Press Release was explicit in explaining that
the retreat from retroactivity was a direct response to court action. “The courts have determined
that, while they are legal, the transition provisions between the Immigration Act and IRPA are
not as fair to applicants who applied before January 1, 2002 as the government had believed.
The government has listened to that message.”

Further Action in the Litigation

Over the summer, counsel for the applicants worked on the completion of the test leaves. The

applications for leave to commence judicial reviews had been completed and we were awaiting

decisions on them when the Minister’s surprise announcement was made.                In a subsequent

teleconference, Gibson J. indicated that leave had been denied in three of the eleven test leaves;

that is, leave would be granted in 8/11 test leave cases, including Anand, Dass and Rasolzadeh.

After the Minister’s September 18, 2003 announcement, the Minister brought a motion to vary

Justice Gibson’s June 20, 2003 Order with respect to the sending of the notices to the 104,000

persons. This motion was to be heard on October 15, 2003 but it was adjourned on consent until

after the proposed amendments to the regulations were released.

The Proposed Amendments to the Regulations

On October 17, 2003, the proposed amendments to the transitional provisions of the IRPR were

released and pre-published in the Canada Gazette. Highlights of the proposed changes include:

   •   the removal of the March 31, 2003 deadline for assessing those applications filed before

       January 1, 2002 under the selection criteria of the former Regulations;

     •    if a pre-January 2002 application is still pending, it will be assessed according to the

          selection criteria of the former Regulations;

     •    applications that were withdrawn after January 1, 2002 may be resubmitted for

          assessment under the old selection criteria on a fee-exempt basis if no refund was

          received; and

     •    applications that were refused after March 31, 2003 will be reassessed under the selection

          criteria of the former Regulations.

The Future of the Class Action

While the proposed amendments to the Regulations certainly appear to respond in a large part to

the concerns which precipitated the class action, counsel are studying them closely and will

continue to press ahead with the class action if we ultimately conclude that the regulations are

deficient in responding to the rights of the class members.


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