9147-0732 Québec Inc: Does Section 12 Protect Corporations From Cruel and Unusual Punishment?

In 9147-0732 Québec Inc. c Directeur des poursuites criminelles et pénales, 2019 QCCA 373 [9147-0732 Québec Inc.], a case that has attracted some media attention, the Quebec Court of Appeal (“QCCA”) addressed the question of whether a corporation can benefit from the Canadian Charter of Rights and Freedoms s.12 protection against “cruel and unusual treatment or punishment” or whether the section protects human persons only. The QCCA majority found that corporations do, in fact, enjoy Charter s.12 protection and remitted the issue to the magistrate to consider whether the $30,843 mandatory minimum fine imposed on companies that engage in construction work without a license amounts to cruel and unusual punishment. The dissent found that legal persons do not benefit from the protection provided by s.12 of the Charter.

The appeal poses questions over the nature of cruel and unusual punishment. It asks whether it is something that has to do with human dignity – human being the operative word – or whether cruel, grossly disproportionate punishment, regardless of who or what is captured by it, may equally be protected by s.12. In other words, the appeal asks whether a grossly disproportionate fine against a corporation may constitute cruel and unusual punishment under the meaning of s.12 of the Charter or whether s.12 protects human persons only.

This post outlines the QCCA decision in 9147-0732 Québec Inc., considers the history of the term “cruel and unusual,” and argues that s.12 may protect legal persons, rather than human ones, but only under extraordinary circumstances. Notably, 9147-0732 Québec Inc. was a ruling on a preliminary issue, and the case is now back before the magistrate for a consideration of the s.12 and other arguments. The Supreme Court of Canada (“SCC”) will likely need to consider the question in the years to come, but it may choose to wait for a more substantive case to do so.

9147-0732 Québec Inc.: The Majority Opinion

In 9147-0732 Québec Inc., the QCCA found a company to have carried out construction work without a license, contrary to sections 46 the Building Act, RLRQ c. B-1.1 [the Act]. The court was bound by s.197.1 of the Act to impose a fine, and it imposed the mandatory minimum of $30,843. In response, the appellant company challenged the constitutionality of the mandatory minimum fine requirement on the grounds that it was grossly disproportionate and violated the s.12 protections against “cruel and unusual” punishment. The appeal in 9147-0732 Québec Inc. focused exclusively on the issue of whether s.12 protects legal persons such as corporations.

In finding that s.12 protects corporations, the QCCA followed R v Boudreault, 2018 SCC 58 [Boudreault]. Boudreault was a December 2018 decision in which the SCC found that another fine – the mandatory victim surcharge – was cruel and unusual punishment contrary to s.12 of the Charter and struck down the mandatory surcharge as unconstitutional. For Justice Bélanger writing for the majority at the QCCA, just as Boudreault held that a mandatory victim surcharge may be grossly disproportionate for some criminal offenders, a “minimum fine may also in some cases constitute cruel and unusual punishment” when imposed on legal persons(9147-0732 Québec Inc., para 91). Justice Bélanger emphasized that s.12 may protect legal persons in “exceptional” circumstances only, such as when a grossly disproportionate fine against a corporation or an organization results in unacceptable consequences or when it completely ignores the principle of proportionality in sentencing (9147-0732 Québec Inc., para 92).

In finding that corporations may be subject to s.12 Charter protection, the QCCA majority noted that other Charter provisions have been found to apply to corporations, such as ss 7, 8, 11 and 24(1) (9147-0732 Québec Inc., paras 34-39). The majority noted that in order to determine the scope of a Charter provision, courts must first determine the provision’s purpose and identify the rights or freedoms it aims to protect. per Hunter v Southam, [1984] 2 SCR 145 [Southam], the interpretation must be broad and general.

In addition to focusing on the principles of sentencing, the majority applied the living tree principle of constitutional interpretation to find that corporations faced with grossly disproportionate fines may be protected by s.12 of the Charter. They found the appellants’ argument that s.12 is founded on the value of protecting human dignity– the strongest one that the court identified contrary to the respondents’ position – unconvincing. According to the majority, the living tree principle of constitutional interpretation, the law’s evolution regarding the rights and liabilities of legal persons, and a legislative context in which the criminal liability of corporations has been significantly expanded suggested support for the argument that s.12 could apply to corporations(9147-0732 Québec Inc., paras 101, 103).

The Dissent

Unlike the majority, Justice Chamberland in dissent wrote from the perspective that s.12 protects human dignity. He emphasized that “cruelty is directed toward living beings, in flesh and blood, whether they are human beings or animals” and “not to corporations,” because “suffering, physical or mental, is peculiar to living beings and not to […] inanimate objects without soul or emotional life” (9147-0732 Québec Inc., para 54-56). Justice Chamberland held that it would completely distort the common sense meaning of the words “cruel and unusual” to say that one can be cruel to a legal person such as a corporation (9147-0732 Québec Inc., para 53).

Like the majority, to reach his conclusion, Justice Chamberland cited Southam for the proposition that Charter rights and freedoms must be understood in a purposive way, in light of the interests they are meant to protect (9147-0732 Québec Inc., para 46). However, Justice Chamberland also emphasized that in Southam, the SCC noted that “[a]t the same time [as conducting the purposive analysis], it is important not to overshoot the actual purpose of the right of freedom in question, but to recall that the Charter was not enacted in a vacuum, and must therefore […] be placed in its proper linguistic, philosophic and historical contexts” (9147-0732 Québec Inc., para 46). Accordingly, the scope of s.12 must be properly restricted to humans and not corporations.

Justice Chamberland connected the Charter’s s.12 to the 1688 English Bill of Rights, in which provisions against “cruel and unusual punishments” were intended to prohibit barbarity and inhumanity, and noted the many definitions of “cruel” which refer to a lack of humanity (9147-0732 Québec Inc., paras 47-52). Although Justice Chamberland acknowledged that the scope of s.12 has broadened since 1688 to include all measures of state repression and control against individuals, rather than on physical suffering only, he emphasized that the term “cruel and unusual” nevertheless is concerned with human dignity only, and therefore the principle cannot be extended to legal persons (9147-0732 Québec Inc., paras 58-59).

Justice Chamberland emphasized that a sentence may be disproportionate or excessive without being cruel and unusual within the meaning of the Charter. In his view, the sentence would only be cruel and unusual if it was excessive to the point of not being compatible with human dignity, and disproportionate to the point where Canadians may consider it abhorrent and intolerable. He added that this would rarely be the case in circumstances when the contested sentence is a fine, and even more rare when the offender is a corporation (9147-0732 Québec Inc., para 27).

Analysis

Both the majority and dissent presented strong arguments in the QCCA decision. Once it is acknowledged that a mandatory minimum fine could have cruel and unusual consequences for an individual – as the SCC found in Boudreault – it seems plausible that a mandatory minimum fine, without leaving the door open to judicial discretion, could also have cruel and unusual consequences for a corporation in exceptional circumstances. On the other hand, it is difficult to compare the nature of human personhood with that of legal personality.

Although the QCCA majority in 9147-0732 Québec Inc. bases itself on Boudreault, it does not consider the practical similarities and differences between the appellants in both cases. The appellants in Boudreault included people who grew up without the benefit of adequate social supports. They included young and old indigent individuals with addiction and mental health problems, who had no realistic prospect of repaying a fine for the foreseeable future. By contrast, legal persons cannot be imprisoned or experience mental illness, as Justice Chamberland pointed out in dissent (9147-0732 Québec Inc., para 69). In fact, little is known about the appellant seeking s.12 protection in 9147-0732 Québec Inc., other than that the legal person was a corporation that had engaged in construction work without a license. While in Boudreault, the value of human dignity is clearly at stake, in 9147-0732 Québec Inc. it is possible that the only interests engaged are economic. Furthermore, it is possible that concerns with the majority’s analysis regarding broadening the scope of s.12 protections include concerns that their decision would strengthen the power of corporations vis-a-vis individuals.

Based on the logic of Boudreault, however, it is likely that the human dignity arguments are not fatal to the appellant’s case in 9147-0732 Québec Inc. It is possible that in extraordinary circumstances, a mandatory minimum fine could constitute cruel and unusual treatment or punishment under the meaning of s.12 of the Charter. At the very least, it seems unjustified to close the door to that possibility. Furthermore, according to Professor Bruce Ryder, a constitutional law professor at Osgoode Hall Law School, the dissent’s concerns about the potential impact of the majority ruling may be overstated, as the current state of the law allows corporations charged with offences to raise s.12 arguments most of the time already.

Because in practical terms legal persons are unlike natural persons in important ways, the circumstances where s.12 grants them protection may be different. It may be that s.12 protects corporations in extraordinary circumstances only. However, the circumstances in which s.12 protects legal persons is a different question than whether s.12 applies to legal persons at all. Overall, it seems likely that courts would not outright exclude the possibility.

Conclusion

The question of whether corporations have a right to s.12 protection is something the SCC will need to address eventually. However, according to Professor Ryder, it is doubtful they would grant leave at this stage of this proceeding: after all, 9147-0732 Québec Inc. was a ruling on a preliminary issue and the case is now back before the magistrate for a consideration of the s.12 and other arguments.

Nonetheless, this case has sparked interest, perhaps because legal entities being compared to human beings often sparks strong public reaction. At a time when courts in Canada and other jurisdictions are considering whether solitary confinement constitutes cruel and unusual punishment, the idea that economic interests may come under s.12 protection may certainly raise eyebrows. The sentiment would not likely be enough to discredit the argument that, in exceptional circumstances, corporations may indeed be protected by s.12 of the Charter and that there are high legal barriers against ruling out the possibility.