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Canada: Top court to rule on veterans' pensions
 
By Graham Fraser

Toronto Star, July 17, 2003

OTTAWA— The Supreme Court of Canada will rule today whether mentally disabled veterans and their heirs have the right to pursue the federal government for billions of dollars in pension money.

The court will rule on a class action lawsuit on behalf of thousands of disabled war veterans whose pensions, allowances and personal monies were managed by the federal government because they were unable to do so themselves.

However, no interest was paid and often when the veterans died, the principal in the account reverted to the government.

In the 1980s, veterans and their heirs began to complain of the unfairness of this.

In 1990, the federal government passed an amendment to the Department of Veterans Affairs Act which started paying interest — but included in the bill a clause saying that no claim could be made for any interest or principal prior to 1990.

In the late 1990s, lawyers launched a class action lawsuit on behalf of Joseph Patrick Authorson, arguing that the legislation did not respect "due process," because there were no hearings on the amendment and veterans were not consulted on its impact. 

The Ontario Court of Appeal ruled in favour of the veterans in March, 2002.

Lawyers representing the veterans estimate that the federal government could be liable for between $1.5 billion to $5.5 billion.

Authorson, who was born in Ontario in 1914, enlisted in the Canadian army in 1939, and was discharged in 1943 as medically unfit after suffering what was then called "shell shock."

He spent most of the rest of his life in mental hospitals.

In 1991, after a doctor found that Authorson was competent to manage his money, there was $188,000 in his pension account and $166,000 in a personal account from an inheritance.

The government had been managing both accounts, and no interest was ever paid.

His lawyers calculate that the government owed him approximately $2 million.

There were between 25,000 and 35,000 veterans in Authorson's position, but fewer than 1,000 are still alive.

Authorson died last year in London, Ont., at the age of 88, but the case is continuing in his name. 

In October, 2000, Justice John Brockenshire of the Ontario Superior Court was scathing in his treatment of the federal law, saying that no evidence of any higher purpose "... for this pernicious subsection, buried in the Bill, that could come even close to objectives of general good for veterans, or for the country as a whole" had been put before him in evidence.

The federal government appealed, and the Ontario Court of Appeal upheld Brockenshire's decision.

Today, the Supreme Court's decision on the federal government's appeal will be made public.

If the Authorson case is successful, subsequent cases now before lower courts will proceed in order to establish who is eligible for the money, and how much the federal government will be required to pay.

Cliff Chadderton, chair of the National Council of Veteran Associations, said yesterday that, regardless of today's decision, the Department of Veterans Affairs should set up a procedure to allow payment of interest on justifiable cases.

"It is clear that the Pension Act is intended only to indemnify disabled veterans, with additional allowances for spouses and for children up to age 25," he said in a statement.

But Chadderton said that a realistic cut-off date should be established so that only those descendants with a legitimate claim on the veteran's estate would be compensated.


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