State Liability and the Rule of Law: The Landmark Case of A.G. v. Power (2024)

In 2011, Joseph Ronald Power was suddenly suspended from his job as a medical radiation technologist in a New Brunswick hospital. His employer had discovered that he had previously been convicted of two indictable sexual assault offences. Two years later, Power applied for a pardon — now called a record suspension — a process that, at the time of his conviction, was permissible under the Criminal Records Act (R.S.C. 1985, c. C-47) and allowed individuals convicted of indictable offences to be eligible for a pardon five years after completing their sentence. This provision, however, had since been amended in 2010 and 2012, making certain indictable offences, such as Power’s, permanently ineligible for a record suspension [1].

When Power brought his case to court, both the Newfoundland and Labrador Supreme Court (Trial Division) and the Court of Appeal ruled in his favor, finding that the retroactive 2010 and 2012 amendments violated Power’s rights under sections 11(h), 11(i), and 7 of the Canadian Charter of Rights and Freedoms [2]. Sections 11(h) and 11(i) protect individuals from additional punishment after their sentence (in Power’s case, the inability to suspend his record) and from the retroactive application of laws, while section 7 guarantees the right to life, liberty, and security of the person [3]. When this case was subsequently appealed to the Supreme Court of Canada by the Attorney General, however, the issue at hand had changed. At stake was whether the federal government could be held liable for Charter damages for enacting legislation later found to be unconstitutional. In a 6–3 decision, the Supreme Court ultimately decided in Canada (Attorney General) v. Power, 2024 SCC 26, that the government can, in such cases, be held liable for damages [4]. This article argues that this landmark precedent marks an important step for Canadian constitutional law by establishing state liability for clearly unconstitutional legislation, not only making just compensation possible for those harmed but also reinforcing the rule of law and accountability for lawmakers within a democratic system.

At its most fundamental level, finding the state liable for damages due to unconstitutional enactments allows individuals to be entitled to compensation, even when the responsible entity is an abstract state or federal government. This reflects section 24(1) of the Charter, which provides that individuals whose rights or freedoms have been violated may seek an appropriate and just remedy from a competent jurisdiction [5]. Vancouver (City) v. Ward, 2010 SCC 27, serves as an example of a previous case that applied this principle: when Alan Cameron Ward, a Vancouver lawyer, was mistakenly identified by police as a threat to Prime Minister Jean Chrétien during a public ceremony; he was subsequently arrested, strip-searched, detained, and had his car impounded without significant evidence. These were clear violations of his section 8 Charter rights against unreasonable search and seizure. The Supreme Court of Canada ultimately upheld decisions from lower courts awarding $5,000 in compensation for the strip search and finding the Vancouver Police Department liable, believing such measures were appropriate under section 24(1) [6]. In the case of A.G. v. Power, Power’s constitutional rights were similarly violated when his guarantee of security under section 7 of the Charter was disturbed by legislation later revoked. This resulted in the very real consequence of him losing a job that he had diligently worked towards [7]. Although Power, unlike Ward, has not yet been awarded specific monetary compensation, the Supreme Court’s more explicit statement of state liability, as well as their situating Power’s case alongside Ward, continues to be an important affirmation that section 24(1) of the Charter can be exercised to provide citizens with necessary remedies and protections, even in the face of state power.

From a broader perspective, the Canadian Supreme Court’s decision in A.G. v. Power is consistent with the long-standing idea of courts acting as a check on legislative bodies. By allowing courts not only to declare certain legislation unconstitutional but also to impose liability on the state, legislatures are prompted to be more conscientious about the laws they enact. Such a check on decisions affecting citizens’ basic rights was emphasized by Alexander Hamilton as early as Federalist No. 78, in which he outlined the responsibilities of the judiciary, noting that it should not be assumed that elected representatives will always accurately reflect the people’s will. Instead, courts serve as an intermediary bridging the legislature and citizens, in keeping with constitutional principles [8]. This responsibility is precisely what the permission of state liability in A.G. v. Power establishes, giving ordinary citizens, such as Powers and Ward, a fundamental means to assert their interests in relation to larger legislative bodies.

Evidence of this principle as a core part of democratic practice is also seen in other leading common law nations, particularly in Europe. In the 1991 landmark case Andrea Francovich and Others v. Italian Republic, prompted by the lack of protection for several Italian employees’ wages after their employer went bankrupt, the European Court of Justice (ECJ) found the Italian state liable for compensation due to a breach of the European Union’s Council Directive 80/987/EEC, which mandates protection for employees in such situations. The decision further established that EU member states could be held accountable for damages caused by violations of EU directives [9]. Since then, several EU countries have implemented similar measures within their national judiciaries, including France’s Conseil d’Etat in 2019, which declared the state liable for damages when individuals are harmed directly under the application of an unconstitutional law [10]. Even in countries such as the United States, where expansive sovereign immunity limits direct liability of the federal government, comparable measures exist. The Federal Tort Claims Act (1946) allows citizens to sue the U.S. government for negligence or wrongful acts by federal agents in certain torts, a principle subsequently upheld by the Supreme Court in United States v. Muniz (1963) [11]. As these examples demonstrate, Canada’s decision in A.G. v. Power aligns with a broader, global recognition of the importance of holding governments accountable for unconstitutional actions, providing a clearer, more direct avenue to protect citizens’ interests.

It is worth noting, however, that A.G. v. Power’s final decision was a close split: five judges (Chief Justice Richard Wagner, Justice Andromache Karakatsanis, Justice Sheilah Martin, Justice Mahée O’Bonsawin, and Justice Suzanne Moreau) voted in favor, while four judges (Justice Mahmud Jamal, Justice Nicholas Kasirer, Justice Russell Brown Rowe, and Justice Suzanne Côté) were either partially or completely dissenting. The strongest dissent was voiced by Justices Côté and Rowe, who believed that complete immunity should be afforded to the legislative process under which Parliament should be able to operate freely without judicial or executive interference. Subordinating this parliamentary privilege to s. 24(1) of the Charter, the judges stated, would entail making judgements upon legislative motivations, knowledge, or intent, something that would disturb the proper working relationship between the courts and legislature [12].

While these concerns touch upon another fundamental part of the Canadian Constitution (section 18), which outlines particular immunities for Parliament and maintains the separation of powers, A.G. v. Power’s decision has been carefully construed so as not to constitute an overreach of judicial authority [13]. For instance, the requirements for state liability are strictly limited to acts that are “clearly unconstitutional” and apply only to the effects of the legislation, without interfering in the drafting or preparation stage, which would require insight into legislative motives or risk violating due freedoms. Moreover, this decision upholds the core principle of the rule of law — that everyone, including the government, is subject to the law, and in this case, the Constitution. If individual citizens can be held accountable and required to provide compensation for violating constitutional rights, then so too should state powers. This principle is not only entrenched within the Canadian Charter, but also explicitly established by R. v. Oakes (1986), which created the Oakes Test, a framework for assessing whether a law that limits Charter rights is justified, reinforcing that all government action, including legislation, must conform to constitutional limits [14]. A.G. v. Power, although an extension of this principle into the area of state liability, further strengthens the fundamental responsibility under the Constitution that all entities, including legislators, are bound by the law, ensuring a fairer balance between the state and ordinary citizens.

Given the justifiability of providing due compensation for direct harm to individuals, and the broader concept of state liability as adhering to foundational principles of the rule of law, A.G. v. Power sets Canada on the right path, following in the footsteps of other democratic countries that recognize the crucial role of holding the state accountable for certain damages. This measure not only provides citizens with a mechanism to seek justice when an unconstitutional law interferes with their livelihood, but also makes legislators aware of the consequences of the laws they enact, while still providing adequate immunity for the drafting and creation process.* A.G. v. Power*, however, is by no means the end of the story; it is merely the beginning. How Canadian courts will apply this decision in practice, what qualifies as “clearly unconstitutional” — a high bar — and how often citizens are actually able to receive just compensation, remain open questions. Nonetheless, the fact that this case has opened these doors of inquiry is evidence of progress, one that may one day prevent citizens like Powers from being burdened by unconstitutional enactments.

References

[1] Canada (Attorney General) v. Power, 2024 SCC 26 ___ (Supreme Court of Canada 2024), https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/20546/index.do.

[2] Canadian Charter of Rights and Freedoms, Part I of the Constitution Act, 1982, being Schedule B to the Canada Act 1982 (U.K.), 1982, c. 11, amended 2012, ss. 7, 11(h), 11(i), accessed October 18, 2025, https://laws-lois.justice.gc.ca/eng/const/page-15.html

[3] Non-retroactivity in law is widely recognized by legal scholars as a general principle. This principle holds that, except in cases involving extraordinary criminal acts, an individual should not be held responsible for actions committed before the enactment of a law. For examples, see Yarik Kryvoi and Shaun Matos, “Non-Retroactivity as a General Principle of Law,” Utrecht Law Review 17, no. 1 (2021): 46–58, https://doi.org/10.36633/ulr.604; James Popple, “The Right to Protection from Retroactive Criminal Law,” SSRN Electronic Journal, ahead of print, 2009, https://doi.org/10.2139/ssrn.1335644.

[4] Canada (Attorney General) v. Power, 2024 SCC 26.

[5] The Canadian Charter of Rights and Freedoms, § 24(1) (1982), https://www.justice.gc.ca/eng/csj-sjc/rfc-dlc/ccrf-ccdl/check/art241.html.

[6] Vancouver (City) v. Ward, 2010 SCC 27 ___ (Supreme Court of Canada 2010), https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/7868/index.do. [7] The Canadian Charter of Rights and Freedoms, § 7 (1982), https://www.justice.gc.ca/eng/csj-sjc/rfc-dlc/ccrf-ccdl/check/art7.html.

[8] Alexander Hamilton, “The Federalist No. 78,” in The Federalist Papers (J. and A. McLean, 1788).

[9] Andrea Francovich and Danila Bonifaci and Others v. Italian Republic, ECR I-5357 ___ (European Court of Justice 1991), https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=celex%3A61990CJ0006; Council Directive 80/987/EEC, 31980L0987 (1980), https://eur-lex.europa.eu/eli/dir/1980/987/oj/eng.

[10] Conseil d’État, “The Conseil d’Etat Affirms the Existence of State Liability for Loss and Damage Resulting from an Unconstitutional Law,” Décision De Justice, December 24, 2019, https://www.conseil-etat.fr/en/news/the-conseil-d-etat-affirms-the-existence-of-state-liability-for-loss-and-damage-resulting-from-an-unconstitutional-law.

[11] Federal Tort Claims Act, 28 U.S.C. §§ 1346(b), 2671–2680 (1946); United States v. Muniz, 374 U.S. 150 ___ (Supreme Court of the United States 1963), https://supreme.justia.com/cases/federal/us/374/150/.

[12] Canada (Attorney General) v. Power, 2024 SCC 26.

[13] Constitution Act, 30 & 31 Vict., c. 3 § 18 (1867), https://laws.justice.gc.ca/eng/Const/FullText.html#section18.

[14] R. v. Oakes, [1986] 1 S.C.R. 103 ___ (Supreme Court of Canada 1998), https://decisions.scc-csc.ca/scc-csc/scc-csc/en/item/117/index.do.