Municipal councillors are generally protected from personal liability, for any decisions they make in good faith in the course of their duties. This protection is incorporated into Municipal Acts of each province. For example, the Municipal Government Act of Alberta states:
535(2) Councillors, council committee members, municipal officers and volunteer workers are not liable for loss or damage caused by anything said or done or omitted to be done in good faith in the performance or intended performance of their functions, duties or powers under this Act or any other enactment.
In Gook v. Quesnel, Justice Smith explained why:
97 The obvious policy reason behind this general immunity is that there is a major public interest in the democratic administration of municipalities, which requires that individuals in those communities be willing to run for office. There are numerous ways that actions taken by a municipal council may be subsequently found to be unlawful…particularly … in smaller municipalities such as Quesnel, which may not have the in-house legal staff present in larger cities. Without the protection from personal liability that s. 287 provides, individuals would be reluctant to seek municipal office.
There is usually an exception for unlawfully spending civic funds, but even this is strictly construed
99 ….. If council members could be held personally liable for unlawful expenditures even where they acted honestly, reasonably and with no knowledge that the action was unlawful, it is difficult to imagine why any reasonable person would be willing to run for office.
It is against this background that Ontario municipal councillors and senior staff are nervously awaiting December 31, 2012, when s. 14 and 19 of the Safe Drinking Water Act, 2002 (SDWA) come into force. Among others, section 19 imposes a personal duty on “every person who, on behalf of the municipality, oversees the accredited operating authority of the [drinking water] system or exercises decision-making authority over the system.” That duty is to
(a) exercise the level of care, diligence and skill in respect of a municipal drinking water system that a reasonably prudent person would be expected to exercise in a similar situation; and
(b) act honestly, competently and with integrity, with a view to ensuring the protection and safety of the users of the municipal drinking water system. 2002, c. 32, s. 19 (1).
Every one who fails to carry out this duty is guilty of an offence, and liable to jail and/or to substantial fines, as well as to administrative liability (i.e., regulatory orders) and potentially civil suits.
S. 14 allows the municipality and its staff and counsel to delegate almost all of their water system duties to an accredited operating authority, including their duty to “ensure” water safety. Critically, however, they cannot delegate their duties under section 19, or their duty to “ensure that the accredited operating authority carries out its duties under this Act and the agreement in a competent and diligent manner”.
This is a much more demanding measure of personal liability than we have seen before, and goes far beyond acting “acted honestly, reasonably and with no knowledge that the action was unlawful”. It is also evidence of a double standard: the SWDA protects provincial employees (e.g., MOE or Ontario Clean Water Agency staff) from personal liability for acts done in good faith. But such protection is specifically denied to municipal councillors.
How must lay councillors and senior administrators demonstrate “competence” in running a complex modern water system? S. 19 makes only one concession to the personal expertise, or otherwise, of municipal councilors and staff:
A person shall not be considered to have failed to carry out a duty described in subsection (1) in any circumstance in which the person relies in good faith on a report of an engineer, lawyer, accountant or other person whose professional qualifications lend credibility to the report.
Short of making no decision without an engineer’s report, what else can councillors do? The Ontario MOE expects all councillors to carefully study its Taking Care of Your Drinking Water – A Guide for Members of Municipal Councils (the “Guide”), which highlights their personal liability risks. Other provinces are following suit, such as Alberta’s hints of personal liability for councillors in Taking Care of Your Drinking Water and Wastewater: A Guide for Members of Municipal Councils (2012).
Will municipal councillors wait until someone is charged personally, to find out what this new law will mean? Or will municipal organizations work together to develop reasonable benchmarks of competence that their conscientious members can actually meet?
by Dianne Saxe and Jackie Campbell
This article was originally prepared for Water Canada, thank you to Kerry Freek.