Editor’s Note: This post was written as a preview of an upcoming Supreme Court of Canada decision for the Fantasy Courts website and newsletter.

Hi, here’s what you need to know about the Supreme Court of Canada this week in 5 minutes.

Latest News

  1. 🕑 The SCC will release its judgment in Jim Shot Both Sides v. Canada on Friday, April 12, 2024. At issue is whether limitation periods for breach of treaty claims began to run prior to the passage of s. 35 of the Constitution Act, 1982.
  2. 🏦 On Friday, April 5, the SCC released its decision in Eurobank Ergasias S.A. v. Bombardier inc., 2024 SCC 11. In a 7:2 split, the SCC dismissed the appeal, ruling that a Canadian bank could refuse payment to the beneficiary of a letter of credit on the basis of fraud.
  3. 🔮 58% of players correctly predicted the outcome.

Head over to Fantasy Courts to lock in your predictions for this week’s decision, or read more about the cases below.

Case to Predict: Limitation Periods for Breach of Treaty

Appeal by leave from Canada v. Jim Shot Both Sides, 2022 FCA 20

SCC factums and webcast

What Happened?

Background: In 1877, the Blackfoot Confederacy and the Crown executed Treaty 7, which established Reserve No. 148, the largest reserve in Canada. The size of the reserve was to be established through a formula promising “one square mile for each family of five persons, or in that proportion for larger and smaller families”. The Blood Tribe has long claimed that the actual size of its reserve did not accord with that promised by the Treaty and, in 1980, commenced an action in the Federal Court.

Trial: For decades, the action sat in abeyance while alternative resolution processes proceeded at a glacial pace. Finally, in 2016, the trial began. In 2019, the trial judge found that the Blood Tribe’s claims were discoverable more than six years before the action was commenced in 1980 and, except for a claim for breach of treaty, were therefore time-barred through the operation of Alberta’s The Limitation of Actions Act and s. 39 of the Federal Courts Act.

The trial judge held that an action for breach of treaty could not be pursued in a Canadian court prior to the advent of s. 35 of the Constitution Act, 1982. Therefore, for the purposes of the limitations statute, time for a breach of treaty claim only began to run in 1982. The trial judge found that Canada was in breach of its treaty commitment and that the size of the Reserve was understated by 162.5 square miles.

Appeal: The Crown appealed. The Federal Court of Appeal allowed the appeal and varied the Federal Court’s judgment to state that all claims of the Blood Tribe were time-barred.

What Was Argued at the SCC?

Appellant: The Appellants argued that prior to s. 35, there was no meaningful way to pursue breach of treaty claims in Canadian courts. Treaties were considered ordinary contracts, and there were numerous limitation on Indigenous parties pursuing legal action. Section 35 changed the landscape and constitutionalized Aboriginal rights. It can’t be the case that a s. 35-based breach of treaty claim could be statute-barred prior to the existence of s. 35.

Respondent: The Respondent argued that breach of treaty has always been actionable and s. 35 didn’t change that at all. A clear line of decisions says that limitation periods apply to Aboriginal claims, and there is no exception for breach of treaty. The only remedy not time-barred would be a declaration.

What Else Should You Know Before Making a Prediction?

I’m a bit biased on this one, having been part of the counsel team for the Appellants. With that caveat, I’m leaning toward the appeal being allowed. I would be (happily) surprised if the SCC says limitation periods don’t apply to breach of treaty claims. However, I believe there is a strong chance the SCC will find that a declaration is not time-barred here and more specifically that a robust declaration is warranted in this case.

Previous Prediction: Letters of Credit

On April 5, 2024, the SCC released its decision in Eurobank Ergasias S.A. v. Bombardier inc., 2024 SCC 11

Held (7:2): Appeal dismissed. The fraud exception for a Canadian bank having to fulfil its obligations under a letter of credit applies to the Greek bank’s demand for payment.

Key Points:

  • A letter of credit entitles the beneficiary of the letter to payment on demand from the issuing bank. They are issued in order to ensure that the beneficiary will be paid what they believe they are owed under an underlying contract.
  • Fraud is the only exception recognized in Canadian law to the issuing bank’s obligation to pay the beneficiary on demand.
  • When there is fraud by the beneficiary of the credit which has been sufficiently brought to the knowledge of the bank before payment or demonstrated to a court called on by the customer of the bank to issue an interlocutory injunction, the issuing bank does not need to honour the draft.
  • The standard set for fraud is high and in this context requires impropriety, dishonesty or deceit.

Predictions: 58% of players correctly predicted that the appeal would be dismissed.

-Tom Slade

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