Moses v Lower Nicola Indian Band

Background

In January of 2010, the appellant, Donald Moses, was the elected chief of the Lower Nicola Indian Band (LNIB) of the Nlaka’pamux First Nations in southern British Columbia. At that time, five members of the LNIB council purported to pass a resolution to suspend Moses’s authority as chief for 30 days in order to investigate alleged breaches of LNIB policies and bylaws. Moses initiated an application for judicial review of this resolution in the Federal Court.

At the end of the 30-day suspension period, the council passed a second resolution purporting to remove Moses as chief based on an alleged breach of fiduciary duty, a conflict of interest in relation to an industrial waterline project and failures to comply with various band bylaws. Moses amended his Federal Court pleadings to seek a judicial review of the second resolution as well.

In June of 2010, the Federal Court issued a consent order resolving the dispute by declaring the first resolution invalid, quashing the second resolution, and setting out various injunctive prohibitions against LNIB’s council. The consent order also stated that there was no order as to costs.

In August of 2010, Moses wrote to LNIB seeking payment “forthwith” of $99,498.45 for the amount he paid his lawyer for representation in the Federal Court action. LNIB apparently did not to respond to this letter. According to Moses, LNIB was completely dysfunctional between June 2010 and July 2012, resulting in further unrelated Federal Court proceedings.

In January of 2013, Moses wrote LNIB again, this time seeking reimbursement under its Conflict of Interest Policy. This policy allows for the indemnification of councillors for costs and expenses associated with conflicts of interest, including amounts to settle an action or satisfy a judgment, so long as their conduct meets certain criteria, such as acting with due diligence and having reasonable grounds to believe their conduct was lawful. LNIB responded shortly thereafter to deny the request, noting that the Federal Court matter had been resolved by consent and without any order as to costs.

In May of 2013, Moses initiated an action in the British Columbia Supreme Court seeking a declaratory order that LNIB is liable to reimburse him $99,000.00 for legal expenses incurred in the discharge of his duties as chief of LNIB. Moses appeared to have drafted his pleadings himself and the chambers judge had to clarify his claim as being one for “damages based upon the tort of misfeasance in public office and/or unjust enrichment”. LNIB opposed the action on the basis that Moses was not seeking damages; rather, he was trying to claim costs from the Federal Court application in spite of the fact that there had been no order as to costs.

BC Supreme Court decision

LNIB successfully had Moses’s action struck on the basis that his claim for misfeasance was statute-barred and his claim for unjust enrichment disclosed no reasonable cause of action.

The chambers judge found that there was a two-year limitation period for bringing the misfeasance claim and this period ran either from the date of the second resolution from LNIB or from the date on which Moses’s legal fees were incurred. Either way, the limitation period had expired several years earlier and Moses’s arguments for postponement of that period were rejected.

With respect to the claim for unjust enrichment, the chambers judge found that a six-year limitation period applied and the claim was not statute-barred. However, the chambers judge found that Moses had failed to plead any form of “enrichment” that might support this claim since there was nothing in his pleadings to suggest that LNIB had received any “tangible benefit” as a result of Moses paying his own legal fees. 

BC Court of Appeal decision

The Court of Appeal held that the chambers judge erred in finding Moses’s claim for misfeasance in public office was statute-barred. It found that the decisions relied on by the chambers judge for this conclusion were of little assistance on this point, and rejected LNIB’s attempts at characterizing the misfeasance claim as one for “injury to person” or “economic loss arising from personal injury”. Instead, it held that a six-year limitation period applied.

The Court of Appeal went on to note problems with LNIB’s argument that its council was acting within its lawful authority to discipline Moses in 2010. It was unclear whether council passed the resolutions at issue in a properly constituted meeting or whether they were just signed by some members of council. The Court of Appeal also noted that LNIB had consented to an order that stated the resolutions were “invalid and unlawful”.

The Court of Appeal also noted issues with Moses’s pleadings in that he seemed to equate five councillors who purported to pass the invalid resolutions with LNIB itself, and had only named LNIB as a defendant. The Court of Appeal noted that it was difficult to conceive of how LNIB could have committed the tort of misfeasance in public office as the only public offices at issue were held by individual councillors and the chief himself.

Nevertheless, the Court of Appeal referenced the high onus to meet in order to strike a cause of action under BC’s Supreme Court Civil Rules and it declined to strike the misfeasance claim at this point. It noted that it might be arguable to allege that vicarious liability could stretch far enough for Moses to seek legal fees from LNIB for the actions of the five councillors, and it allowed Moses 30 days to amend his pleadings to plead a proper case in misfeasance in public office against LNIB.

The Court of Appeal acknowledged that when a Federal Court consent order states that there is “no order as to costs” this means that no costs go to either party. However, it declined to dismiss the action on the basis of issue estoppel or the argument that it is an abuse of process for Moses to pursue his costs in any event. The Court of Appeal found that these technical questions could not be answered at this stage of the proceedings, and left these questions to be determined by the trial judge with the benefit of amended pleadings and evidence.

The Court of Appeal did however uphold the chambers judge’s striking of Moses’s unjust enrichment claim, holding that no amendment could overcome his failure to plead a “demonstrable financial benefit” to LNIB from him paying his own legal fees.