Nalcor Energy v. Muskrat Falls Corporation, 2018 NLSC 12

court crest IN THE SUPREME COURT OF NEWFOUNDLAND AND LABRADOR GENERAL DIVISION Citation : Nalcor Energy v. Anderson , 2018 NLSC 12 Date : January 26, 2018 Docket : 201608G0159 In The Matter of Rule 53 of the Rules of the Supreme Court, 1986 , S.N.L. 1986, c. 42, Sch. D (as amended) And In The Matter of Eldred Davis being a person against whom a contempt of court proceeding was commenced under Rule 53.03 Between: Nalcor Energy and Muskrat Falls Corporation Applicants And: Andrea Anderson, Jim Learning, John Learning, Kirk Lethbridge and Persons Unknown Respondents Before: Justice George L.

Murphy Reasons for Judgment Given Orally Place of Hearing: Happy Valley-Goose Bay, Newfoundland and Labrador Date of Hearing: December 11, 2017 Date of Oral Judgment: January 26, 2018

Summary:

The Court found that an allegation of civil contempt of court for contravening the terms of an Injunction had been proven. Thecontemnor admitted all the essential elements of civil contempt but argued as a defence that the Injunction was invalid and sought tohave the Injunction set aside. The Court ruled that the claim of invalidity and claim to have the Injunction set aside was not a defence tothe allegation of contempt of court arising from a contempt which occurred while the Injunction was in effect.

Appearances: Chris King Appearing on behalf of the Applicant Eldred Davis Appearing on his own behalf Authorities Cited: CASES CONSIDERED: Freedom Villages Inc. v. Gander (Town) & Turner, 2008 NLTD 116 , 2008NLTD116; Canada v.Taylor, (SCC), [1990] 3 S.C.R. 892, 75 D.L.R. (4th) 577; Henco Industries Limited v. Haudenosaunee Six NationsConfederacy Council (2006), (ON CA), 240 O.A.C. 119, 73 W.C.B. (2d) 469; and Newfoundland (Treasury Board)v. N.A.P.E. (1986), (NL CA), 59 Nfld. & P.E.I.R. 93, 39 A.C.W.S. (2d) 149 (Nfld. C.A.). STATUTES CONSIDERED: Canada Human Rights Act, S.C. 1976-1977, c. 33.

RULES CONSIDERED: Rules of the Supreme Court, 1986, S.N.L. 1986, c. 42, Sch. D (as amended). TEXTS CONSIDERED: Jeffrey Miller, The Law of Contempt in Canada, Second Edition (Toronto, Ontario: Carswell, 2016). REASONS FOR JUDGMENT Murphy, J.: INTRODUCTION [1] This proceeding involves an allegation of civil contempt against Mr.

Eldred Davis as a result of him having allegedly violatedan order in the nature of an injunction issued by this Court on October 16, 2016 (the “Injunction”). [2] Nalcor Energy and Muskrat Falls Corporation (hereinafter “Nalcor”) applied for and was granted the Injunction as a result ofa protest at the Muskrat Falls Construction Site (the “Project Site”) in October of 2016.

The Injunction, among other things, enjoined andrestrained certain named individuals and others having notice of the Injunction from doing any of the things set forth therein, including: a. hindering, delaying, stopping, obstructing or in any other manner interfering with any person going into or coming out from theProject Site; and b. trespassing on the Project Site. [3] As a condition of obtaining the Injunction, Nalcor was required to undertake to this Court to take all steps necessary toenforce by application for contempt or otherwise the provisions of the Injunction. [4] Pursuant to its aforesaid undertaking to the Court, Nalcor brought a number of Interlocutory Applications pursuant to Rule53.03 of the Rules of the Supreme Court, 1986, S.N.L. 1986, c. 42, Sch.

D (as amended) detailing various incidents of breaches orviolations of the Injunction. In these applications, Nalcor requested orders requiring that the various individuals who had breached orviolated the Injunction be required to appear before this Court to show cause why they should not be held in contempt of court. ThisCourt issued the following orders requiring various individuals to appear before the Court to respond to the contempt of court

allegations:

i) an Order For Appearance dated October 24, 2016 naming 22 individuals; ii) an Order For Appearance dated October 31, 2016 naming 15 individuals; iii) an Order For Appearance dated November 21, 2016 naming 10 individuals who had been named in an earlier order and naming 15 new individuals; and iv) various Orders from the bench on July 19, 2017 by which 8 individuals who had been named in an earlier order and 5 new individuals were required to appear before the Court on later dates. [ 5 ] Mr.

Eldred Davis was one of the individuals named in one of the July 19, 2017 orders and he was thereby required to appear before this Court at a later date to respond to the contempt of court allegation against him. [ 6 ] Mr. Davis appeared in this court on a number of occasions and ultimately decided that he wished to challenge the contempt of court allegation against him. As a result, a hearing was held on December 11, 2017. the allegation against mr. eldred davis [ 7 ] There is a single allegation of contempt of court against Mr. Davis.

It is alleged that on May 19, 2017, he trespassed on the Project Site in the area known as the North Spur for a period of one and a half hours along with four other individuals. [ 8 ] The particulars of the allegations against Mr. Davis are set forth in Nalcor’s July 19, 2017 Rule 53.03 Interlocutory Application at paragraphs 15 – 19.

These paragraphs state as follows: 15 At approximately 4:35 p.m., five (5) individuals – Jacinda Beals , Denise Cole , Eldred Davis , Marjorie Flowers , and John Learning – trespassed upon the Project Site in violation of the Injunction Order by walking onto the Project Site at the North entrance to the Project Site. 16 The five individuals walked past a copy of the Injunction Order posted on a stop sign at the North entrance and walked between two trucks owned by and clearly marked as “Speuata Security” (the company contracted to provide private security services on the Project Site), which vehicles were positioned on the roadway in such a way to block unauthorized entrance to the Site.

Security Officers verbally attempted to stop the five individuals from trespassing, including one officer advising them over his truck’s P.A. system that they were trespassing upon private property. However, their warnings were ignored by the five individuals, and the Security Officers did not attempt physical interaction with them. RCMP Officers were present in two marked RCMP vehicles and observed the individuals trespassing but did not otherwise engage with them or attempt to stop them from trespassing. 17.

The five individuals walked along the access road toward the area known as the “North Spur” until approximately 5:00 p.m. (25 minutes) when they stopped and engaged in a ceremony for approximately 30 minutes. One Security Officer followed the group of five from the time they entered upon the Project Site. Two RCMP officers also followed the group in their vehicle and observed. Following their ceremony, the five individuals walked back toward the North entrance, and left the Project Site from the North entrance at approximately 6:00 p.m.

As they exited the Project Site, one Security Officer attempted to hand copies of the Injunction Order to the group. Marjorie Flowers took a copy of the Injunction Order as she left the Project Site. She briefly looking (sic) at it and then commented “I already have this one” as she dropped it to the ground and continued walking. The group of five then reunited with the approximately nine (9) other protestors who had stayed congregated outside the North entrance. Within a short time, the full group left the area in the vehicles they had parked near the entrance. 18.

Local CBC reporter, Katie Breen, was present and reported about the group’s violation of the Injunction Order.

A story posted on the CBC Newfoundland and Labrador’s website on the evening of on (sic) May 9, 2017 contained the headline “Muskrat Falls protestors break injunction on eve of court date” and contained pictures and video of the Injunction Order posted near the North entrance, the five named individuals trespassing onto the Project Site, and an interview with Denise Cole in which she admitted to knowledge of the Injunction Order, but stated that because of her beliefs the Injunction Order does not apply to her. 19.

As a consequence of learning about the trespass planned for the North Spur on May 9, 2017, Nalcor ordered the approximately four (4) workers who were scheduled to work in the North Spur vicinity that day, not to report for work, as a safety/security precaution. position of mr. eldred davis [ 9 ] On a number of occasions when Mr. Davis appeared before this Court in respect of the contempt of court allegation against him he acknowledged that he had disobeyed the Injunction. I refer in particular to his appearances on August 30, 2017 and November 1, 2017.

Further, at the hearing of December 11, 2017, he admitted the facts as alleged by Nalcor; however, took the position that he did not believe he was guilty of contempt of court because of his claim that the Injunction was invalid and he sought to have it set aside. position of nalcor [ 10 ] Nalcor took the position that there is no basis in law upon which a court could retroactively dissolve or set aside a prior order

such that a person’s disobedience of that order would not constitute civil contempt. It argued that even an order subsequently found tohave been invalidly issued was still required to be obeyed while it was in force and disobedience of the order still constituted contempt ofcourt. analysis [11] Green, CJTD (as he then was) in the case of Freedom Villages Inc. v.

Gander (Town) & Turner, 2008 NLTD 116 ,2008NLTD116, outlined the elements of civil contempt of court at paragraph 76 where he said: [76] For the court to be satisfied as to the existence of civil contempt based on failure to comply with an injunctive order, fourelements need to be proven beyond a reasonable doubt: 1. the terms of the order must be clear and unambiguous; 2. the defendant must have had proper notice of the terms of the order; 3. the terms have been broken by the defendant; and 4. there must be proof of mens rea. . . . [12] In this case, Mr. Davis takes no issue with any of these elements.

He does not dispute that the terms of the Injunction are clearand ambiguous. He does not dispute that he had proper notice of the terms of the Injunction and in fact acknowledges seeing a copy of iton the day it was issued. He admits that he broke the terms of the Injunction by trespassing on the Project Site on May 9, 2017 and healso admits that the trespass was intentional. [13] Instead, the positon of Mr. Davis and the sole argument raised by him in response to the civil contempt allegation against himis that the Injunction was improperly issued and is thereby invalid.

His argument is that because the Injunction is invalid, he ought not befound to have acted in contempt of same. In fact, Mr. Davis was given the opportunity to file documents in advance of the hearing of thecivil contempt of court allegation and the documents he filed consisted of an Interlocutory Application, an Affidavit and a Memorandumof Argument and all focused on having the Injunction dissolved or set aside on various grounds. [14] In this case, there is no dispute that the Injunction was in full force and effect on May 9, 2017 when Mr. Davis violated samethrough

an act which he described as one of civil disobedience. [15] I have no doubt that Mr. Davis firmly and sincerely believed that his act of civil disobedience on May 9, 2017 was morallyjustified. Further, I have no doubt that Mr.

Davis firmly and sincerely believes that the Injunction ought never have been granted and thatit is invalid and should be set aside. [16] However, the proceeding before this Court is one of civil contempt and the question which must be analyzed is whether in sucha proceeding a court ought to even consider the question of the validity of the underlying order which a person is alleged to havecontravened or violated such as the Injunction. [17] The answer to this question in my view is that a court should not do so. This principle of law is very well established in thiscountry.

The rationale for this principle is that in a society governed by the rule of law, court orders are to be obeyed as long as they arein effect. The remedy for a person who believes an order to be invalid is not to violate the order and then claim in defence to a courtproceeding, such as a contempt proceeding arising from the violation, that the order is invalid. Instead, the proper approach for a personwho believes a court order is invalid is to seek a further order from the court declaring the earlier order to be invalid.

Otherwise peoplewould pick and choose which court orders they are going to follow depending on their view of such orders. It does not take muchthought to see what the result would be. It would be anarchy and the end of the rule of law as the basis upon which our society isgoverned. [18] The Supreme Court of Canada has dealt with this principle of law in a number of cases. In Canada v.

Taylor, (SCC), [1990] 3 S.C.R. 892, 75 D.L.R. (4th) 577, the Supreme Court of Canada dealt with inter alia the question of whether individualswho were subject to a cease and desist order issued by the Canadian Human Rights Tribunal could defend contempt proceedings arisingfrom their failure to obey the cease and desist order by challenging the constitutionality of certain provisions of the Canada HumanRights Act, S.C. 1976-1977, c. 33 which had given rise to the cease and desist order.

McLachlin, J. (as she then was) writing for theminority but for a unanimous court on this point said at paragraphs 182 – 184: 182 Pre-Charter Canadian and common law authority also supports the proposition that even an invalid court order must be followeduntil it is set aside by legal process. The position at common law has been summarized as follows: It is well established that a contempt application is not answered by the assertion that the injunction was erroneously granted or even thatit was void.

The proper course is to move against the injunction or to appeal and the court will not permit the original order to beattacked collaterally in contempt proceedings. Again, however, courts have considered the wisdom or validity of the initial decree indetermining the appropriate sanction.

See R. J. Sharpe, Injunctions and Specific Performance (1983), at p. 259, and cases cited therein. 183 On the other hand, it may be argued that imprisonment for disobedience of an order founded on a constitutionally invalid sectionshould not occur in the normal course. On this view, a review [page974] of the contempt citation can be sought at the same time as theorder is challenged, on the basis that while the order is technically valid until set aside, it would be unjust to maintain a conviction forcontempt where the conduct consists in exercising one's constitutional rights as enunciated by the courts.

During the interval while theconstitutionality of the statute is under review, it would be appropriate to request that service of the sentence be deferred on terms, as isoften done where criminal convictions are under appeal. 184 In my opinion, the 1979 order of the Tribunal, entered in the judgment and order book of the Federal Court in this case, continuesto stand unaffected by the Charter violation until set aside. This result is as it should be. If people are free to ignore court orders becausethey believe that their foundation is unconstitutional, anarchy cannot be far behind.

The citizens' safeguard is in seeking to have illegalorders set aside through the legal process, not in disobeying them. [19] While McLachlin, J. would have found the cease and desist orders to be invalid (this was the minority position), she went on todiscuss the impact of the invalidity on the contempt proceedings and said at paragraph 186: 186 . . . For the purposes of the contempt proceedings, it must be considered to be valid until set aside by legal process.

Thus, theultimate invalidity of the order is no defence to the contempt citation. [20] Similarly, on this point Jeffery Miller in The Law of Contempt in Canada, Second Edition, (Toronto, Ontario: Carswell, 2016)said at page 167: 7.11 Orders wrong or ineffective in Law 7.11(

a) Generally It is no defence that the court order is incorrect, null, unconstitutional, or under appeal, and thus “ineffective”.

The order stands,and commands respect in all of its aspects, until it is reversed on appeal “or an equally effective order [is] secured to the effect that it need not be obeyed.” 104 Thus, where a court sets aside an order after the contempt finding (here, because of inaccuracies in the contemnor’s statements in an affidavit filed in support of the order), that revocation is no (retroactive) excuse for non-compliance. 105 . . . [21] The Ontario Court of Appeal dealt with the same type of issue in the case of Henco Industries Limited v.

Haudenosaunee SixNations Confederacy Council (2006), (ON CA), 240 O.A.C. 119, 73 W.C.B. (2d) 469. The case arose out of a largeprotest by a group of indigenous protesters against a land development. An injunction was issued in respect of the protest andsubsequently contempt proceedings were brought for breaches or violations of the injunction. The Ontario government eventually madea deal to buy the land, which was the subject of the protest, from the land developer. The Ontario government then joined with the landdeveloper, Henco Industries, in a request to the court that the injunction be dissolved.

The Judge hearing the application to dissolve theinjunction found that the injunction would bind the Ontario government and that it would not be dissolved until the contemptproceedings were completed. That decision went to the Ontario Court of Appeal for review. The Ontario Court of Appeal found that theJudge hearing the application should have dissolved the injunction as requested by the land developer and the Ontario government.However, the court also found that as long as the injunction was in effect it was a valid order and anyone who may have disobeyed itwould be in contempt of court.

At paragraph 90 of its decision, the court stated: 90 . . . The law is clear that an order of the court, however wrong, must be obeyed until it is reversed or varied. See Ontario (A.G.) v.Paul Magder Furs Ltd. (1991), (ON CA), 6 O.R. (3d) 188 (C.A). Thus, even though the motions judge ought to havedissolved the injunction on July 5, it nonetheless remained in force until our stay on August 25. During the time the injunction remainedin force, protestors were required to obey it.

Any failure to do so would amount to contempt. [22] Thus, the Court of Appeal found that even though the Judge hearing the application erred and the injunction should have beendissolved when the land developer and the Ontario government had requested it, the injunction remained a valid order until the Court ofAppeal set it aside.

The result was that failure to obey it during that period between when the court found it ought to have been set asideand when it was actually set aside would still amount to contempt of court. [23] In this province, our Court of Appeal dealt with the same principle of law in the case of Newfoundland (Treasury Board) v.N.A.P.E. (1986), (NL CA), 59 Nfld. & P.E.I.R. 93, 39 A.C.W.S. (2d) 149 (Nfld. C.A.). The case arose out of a tradeunion’s defiance of an injunction order. The union brought an application to have the injunction declared invalid at a time when it wasstill defying the injunction.

The Judge of the Trial Division of the Supreme Court before whom the application was brought refused tohear the trade union because of the ongoing defiance of the injunction. The union appealed to the Court of Appeal and in an oraljudgment Morgan, J.A. for the court said at paragraphs 10 – 14: 10 The law is clear; an injunction must be obeyed implicitly. To adopt the language of Romer, L.J. in Hadkinson v. Hadkinson,[1952] 2 All E.R. 567 at p. 569:

It is the plain and unqualified obligation of every person against, or in respect of, whom an order is made by a court of competent jurisdiction to obey it unless and until that order is discharged. ... Such being the nature of this obligation, two consequences will, in general, follow from its breach. The first is that anyone who disobeys an order of the court (and I am not now considering disobedience of orders relating merely to matters of procedure) is in contempt and may be punished by committal or attachment or otherwise.

The second is that no application to the court by such a person will be entertained until he has purged himself of his contempt. 11 There are exceptions to the strict application of that rule, having regard to the nature and effect of the court order in question. In the case of an injunction, however, the rule is uncompromising. An injunction must be obeyed and a person will not be heard by a court to set aside that injunction while he is in contempt of it.

It is not open to parties affected by an injunction to determine for themselves whether that order is null or valid, irregular or regular, and so decide whether to obey it or not. The order continues to exist until it is discharged by the Court and while it exists it must not be disobeyed. To hold otherwise would set at naught the Rule of Law which is the cornerstone of our democratic society. 12 Counsel for the appellant places great emphasis on

Section 52 of the Constitution Act 1982 which provides: 52.-

(1) The Constitution of Canada is the supreme law of Canada, and any law that is inconsistent with the provisions of the Constitution is, to the extent of the inconsistency, of no force or effect. 13 He argues that on the plain wording of that

section a person is free to disobey any law he considers to be in contravention of the Constitution. That

interpretation would give free rein to civil disobedience and is rejected. No one would deny the right of any citizen to properly challenge the constitutional validity of any law and, if it is eventually proclaimed unconstitutional by a court of competent jurisdiction, it need no longer be complied with. Unless and until it is declared to be unconstitutional, however, it must be respected. 14 We do not for one moment suggest that a union or any person, against whom an ex parte injunction is issued and who feels that the injunction is invalid or irregular, is left without a remedy.

If the injunction is obeyed, as the law requires, the person affected by that injunction and who wishes to dispute its validity or regularity is free to make an immediate application to the Judge who gave the Order for an ex parte order to stay the injunction for cause. Alternatively he may issue a summons out of the Supreme Court for a prompt determination by that Court of the validity of the injunction. At that hearing he would be afforded every opportunity to present evidence and argument.

In this case the union chose not to adopt either course of action but elected to defy the court order and to continue what had become illegal picketing of the respondent's premises. [ 24 ] The principles set forth in the various cases I have referred to in this judgment apply equally to the facts of this case. [ 25 ] All individuals, including Mr. Davis, are required by law to obey the Injunction as long as it is in force. It is not a valid defence to a contempt proceeding arising from a failure to obey the Injunction to argue and attempt to establish that the Injunction is invalid and should be set aside.

Even if this Court or a higher court were at some point to declare the Injunction invalid and set it aside, this would not constitute a defence to a contempt proceeding arising out of a breach prior to the declaration of invalidity and dissolution of the Injunction. [ 26 ] The result in the circumstances is that Mr. Davis is guilty of civil contempt of court by contravening the terms of the Injunction through his actions on May 19, 2017. [ 27 ] Prior to concluding my decision, I would point out for the benefit of Mr.

Davis and other like-minded individuals who might read this judgment that anyone who feels the Injunction is invalid or irregular and should be set aside or modified is not left without a remedy under our legal system. This remedy was discussed by Morgan, J.A. at paragraph 14 of the Newfoundland (Treasury Board) v. N.A.P.E. decision referred to earlier. The remedy is to go before the court which issued the Injunction, namely this Court, and by the presentation of evidence and the making of argument seek to have the Injunction declared invalid or irregular and thereby set aside or modified.

If one is not satisfied with the decision from this Court they will have the right to appeal that decision to the Court of Appeal for this province. [ 28 ] My decision that Mr. Davis is guilty of civil contempt of court should not be viewed as an assessment of the merits of his claim that the Injunction is invalid and ought to be set aside. I have not made any such assessment in the context of this proceeding because it is my view that it is not appropriate to do so. Simply put, the merits of his claim have no impact in this case on whether he is guilty of civil contempt of court.

A finding of invalidity subsequent to

an act of contempt is not a defence. [ 29 ] If Mr. Davis wishes this Court to consider the merits of his claim that the Injunction is invalid and ought to be set aside then he is fully entitled to ask the Court to do so by following the correct procedure. I reiterate the correct procedure is not to advance such a claim in defence of a civil contempt of court proceeding. Instead, it should be brought as a separate proceeding.

_____________________________ George L. Murphy Justice