Though the Canadian Charter of Rights and Freedoms provides at section 12 the protection of an accused against imposition of “cruel and unusual treatment or punishment”, the Supreme Court has now held, in Quebec (Attorney General) v. 9147-0732 Quebec inc., 2020 SCC 32, that although the language specifies that such protection applies to “everyone” — a term that the courts have interpreted as including both individuals and corporations — the nature of the protection involved and its history, and particularly the idea of punishment being “cruel”, could not be intended to cover corporations.
Like the judges who ruled on the previous stages, the Supreme Court viewed the terms “cruel and unusual” as being related to human dignity, intolerable pain or punishment so disproportionate in relation to the offence as to be “abhorrent or intolerable” [par 17]. The Court distinguished cases like the 1985 decision that struck down the Lord’s Day Act as violating freedom of religion, although the offender, Big M Drug Mart in that case, was a corporation and, therefore, could not have any religion whatsoever, since what was involved in that case was the “offensive” nature of the law itself.
In this latest case, the Supreme Court held that neither minimum fines nor the making of such minimum fines many times higher for a corporation than for an individual could, in and of themselves, be viewed as being “cruel or unusual”. Nor could the Company rely on the fact that no offence could be committed except through human beings, so as to indirectly benefit from the protection. As the Court held, incorporation has some attractive elements but also some inherent disadvantages. It’s a package and you cannot cherry pick between them.
Finally, the Court dismissed any idea that one could argue that the Charter protection of “life” could be applicable because the fine might in fact lead to corporate bankruptcy.
Many statutes, both provincial and federal, provide for minimum fines to be imposed for offending behavior. Others provide that corporations are liable to fines much stiffer and, indeed, many many times greater than when committed by individuals. The hit to a corporation’s pocketbook that minimum fines and indeed fines greater for companies than for individuals may be very very substantial indeed.
This is particularly true of what are considered strict liability offences like those created by laws regulating health and safety or those concerning licensing standards. These are just examples. In the case the Supreme Court decided, the Company was accused of acting as a building contractor without a current license or carrying out construction work using the services of someone else who did not hold a valid license for that purpose. Violation brought with it a minimum fine of more than $30,000, and a maximum fine of more than $154,000, that is between twice and three times greater for a corporation than for an individual.
The takeaway here is that regulatory statutes are not mere inconveniences of doing business. The bite to the corporate pocketbook is designed to ensure compliance, by contributing disproportionally to the public purse. In the current pandemic, a Company that flouts public health regulations may find it very expensive! As always, an ounce of prevention is worth a pound of cure. Getting proper legal advice is business imperative or, as the adage goes “forewarned is forearmed”.