A-392-78
Isaac Dallialian (Appellant)
v.
Unemployment Insurance Commission (Respond-
ent)
and
Deputy Attorney General of Canada (Mis -en-
cause)
Court of Appeal, Jackett C.J., Pratte and Ryan
JJ.—Montreal, November 21 and 22, 1978.
Judicial review — Unemployment insurance — Receipt of
pension under Quebec Pension Plan during benefit period —
Provision requiring early termination of benefit period on such
pension becoming payable replaced before applicant's pension
became payable — Replacement section providing for early
termination only on applicant's attaining sixty-five — Wheth
er or not benefit period terminated by virtue of earlier section
— Unemployment Insurance Act, 1971, S.C. 1970-71-72, c.
48, s. 31(3),(4) — Federal Court Act, R.S.C. 1970 (2nd Supp.),
c. 10, s. 28.
This section 28 application is directed against the decision of
an Umpire under the Unemployment Insurance Act, 1971,
holding that the applicant was not entitled to the unemploy
ment insurance benefits that he was claiming. A benefit period
for applicant, who was born in December 1906, was established
in July 1975, and terminated by the Commission on February
1, 1976, pursuant to section 31(3)(b) of the Unemployment
Insurance Act, 1971. At the time the benefit period was
established, section 31(3)(b) provided for termination during
the week a retirement pension became payable to a beneficiary
under the Canada or Quebec Pension Plans. The section was
amended January 1, 1976, to provide only that any benefit
period would terminate on a claimant's attaining sixty-five
years. The issue is whether the benefit period was terminated
by virtue of the original section 31(3), when the pension
became payable to him under the Quebec Pension Plan
although that provision had been repealed on January 1, 1976.
Held, the application is allowed. In order to determine
whether applicant is entitled to these benefits, reference must
be made to the Act as it existed subsequent to February 1,
1976, not as it had existed previously. The right cited by
applicant came into being at that time for the Act no longer
said that a claimant could not receive unemployment insurance
benefits if he was receiving a pension under the Quebec Pension
Plan. The applicant could not be deprived of the right to receive
the benefits he claimed by reason of the fact that after January
1, 1976 he had received a pension from the Quebec Pension
Plan.
Also, per Jackett C.J.: The rule of interpretation often
invoked by Umpires reaching a contrary conclusion—that
unless a contrary intention appears, the repeal of an enactment
does not "affect any right ... acquired ... [or] accruing ...
under the enactment ... repealed"—has no application. The
only substantive "right" conferred on an insured person is that
right which has accrued when those things have happened that
entitle him to be paid benefit, and the provision that a person
for whom a benefit period is established is "entitled to benefit
in accordance with this Part" merely creates an expectancy
that is no different in kind from the expectancy of an insured
person who is still employed. Apart from the fact that S.C.
1976-77, c. 11 was not law when the Commission made the
decision giving rise to these proceedings, it does not apply to
these proceedings to alter the result in this case.
APPLICATION for judicial review.
COUNSEL:
J. Barrière for appellant.
G. Leblanc for respondent and mis -en-cause.
SOLICITORS:
Barrière, Neuer, Lamarche, Lachine, for
appellant.
Deputy Attorney General of Canada for
respondent and mis -en-cause.
The following are the reasons for judgment
delivered orally in English by
JACKETT C.J.: I concur with the judgment pro
posed by Pratte J. and with his reasons therefor.
His reasons are, in effect, the reasons of the Court.
Ordinarily, I would not add anything in such
circumstances. However, as we are taking a posi
tion in a matter of general importance that differs
from that taken by several of the Umpires, I deem
it advisable to put on the record, by way of concur
ring reasons, a somewhat different way of express
ing what, in my view, is substantially the same
reasoning.
To appreciate the problem raised by this section
28 application, it is necessary to have in mind
(a) the procedure established by the Unemploy
ment Insurance Act, 1971, S.C. 1970-71-72, c.
48, whereby an insured person establishes his
right to benefit, and
(b) the conditions established by the Act for
creation of a right to benefit.
For present purposes, the procedure may be
described as follows:
First step. Upon becoming unemployed, an
insured person makes a claim (sometimes called
an "initial claim") (sections 53, 55 and 19) as a
result of which the Commission, if satisfied inter
alia that the applicant is "qualified", in so far as
the prescribed periods of insurable employment
and interruption of earnings are concerned,
establishes a "benefit period" (sometimes called
"an initial benefit period") for him, the duration
of which is a fixed time subject to earlier termi
nation (sections 17, 19, 20, 31 and 53(3)).
Second step. Upon deeming himself entitled to
benefit for a week of unemployment in a benefit
period so established, the insured person makes
a claim for benefit for that week and the Com
mission then decides whether or not "benefit is
payable ... for that week" (section 54).
Third step. An insured person who does not
accept the Commission's decision may appeal to
a Board of Referees from whose decision there is
an appeal to an Umpire (sections 94 and 95).
(At this point it might be noted that, upon a
benefit period being established it is enacted that
"benefit is payable to him" in accordance with
Part II of the Act (section 19) but the statute
provides that "No person is entitled to any benefit
for a week of unemployment in a benefit period .. .
until he makes a claim for benefit for that week"
and proves that "he meets the requirements enti
tling him to receive benefit" (section 54).)
The conditions precedent to being entitled to
benefit may be summarized for present purposes
as follows:
(a) a benefit period must have been established
for the insured person after he has satisfied the
Commission that he is "qualified";
(b) a two week waiting period must have been
served (section 23);
(c) in respect of any day for which benefit is
claimed, it must have been established that he
was capable of and available for work and
unable to obtain employment or was "inca-
pable" (section 25);
(d) the benefit must be in respect of a period
that falls within the benefit period (section 54).
The problem raised in these proceedings is
whether a benefit period that was established for
the applicant was terminated on or before January
31, 1976 inasmuch as the benefits claimed are in
respect of periods after that time. The events
giving rise to the problem may be summarized as
follows:
1. Prior to January 1, 1976, section 31 of the
Act read, in part:
31. (1) Notwithstanding section 19, an initial benefit
period shall not be established for a claimant if at the time he
makes an initial claim for benefit
(a) he is seventy years or over, or
(b) a retirement pension has at any time become payable
to him under the ... Quebec Pension Plan.
(3) Any benefit period established for a claimant under
this Part, if not earlier terminated under this Part, terminates
at the end of the week in which
(a) he attains the age of seventy years, or
(b) a retirement pension at any time becomes payable to
him under the ... Quebec Pension Plan,
whichever first occurs.
2. A benefit period was established for the
applicant in July, 1975, when he was between 68
and 69 years of age.
3. By section 10 of chapter 80 of the Statutes of
1974-75-76 (assented to on December 20,
1975), section 31 of the Act was repealed and a
new section 31 was enacted reading, in part:
31. (1) Notwithstanding section 19, an initial benefit
period shall not be established for a claimant if at the time he
makes an initial claim for benefit he is sixty-five years of age
or over.
(4) Any benefit period established for a claimant under
this Part, if not earlier terminated under this Part, terminates
at the end of the week in which he attains the age of
sixty-five years.
and, by section 38(2) of chapter 80, it was
enacted inter alia that section 10 "shall come
into force on the 1st day of January, 1976".
4. A retirement pension became payable to the
applicant under the Quebec Pension Plan in
February, 1976.
Following such series of events, the Commission
decided that the appellant was not entitled to
benefit after January, 1976. Its position was, in
effect, upheld on an appeal to a Board of Referees
on October 21, 1977 and, on an appeal to an
Umpire, on July 18, 1978.
This section 28 application is to set aside the
aforesaid decision of the Umpire.
The neat question raised by these proceedings is
whether the benefit period established for the
applicant in July 1975 was terminated, by virtue of
the original section 31(3), when the pension
became payable to him under the Quebec Pension
Plan in February 1976, although that provision
had been repealed on January 1, 1976.
The provision in question, in so far as appli
cable, is that a benefit period "terminates ... at
the end of the week in which ... a retirement
pension ... becomes payable to him ...". [The
italics are mine.] Such a provision, in accordance
with the ordinary rules of interpretation, as I
understand them, can only operate when it is in
force as a rule of law. It is clear that it cannot
operate retroactively in the absence of a clear
legislative indication. I should have thought that it
is at least equally clear that it cannot operate as of
a time after it has been repealed, in the absence of
such an indication.'
Prima facie a substantive change in the law only operates in
relation to events that happen after the change has taken effect
while a procedural change in a law operates "as far as it can be
adapted" to enforce rights and obligations of a substantive
nature that arose before the change took place. Compare the
Interpretation Act, R.S.C. 1970, c. I-23, section 36(d) and (I).
While the establishment of a benefit period is part of the
procedural process for bringing a benefit right into existence,
its termination effects a change in the definition of the substan
tive right to benefit. A change in the law concerning its
termination, in the absence of clear legislative indication to the
contrary, only operates, therefore, in relation to events that
happen after the change has taken place.
I should, therefore, have had no hesitation in
concluding that the Umpire's decision in this
matter should be set aside if it were not for a
number of Umpire decisions that have reached a
contrary conclusion by invoking a rule of interpre
tation, to be found in the Interpretation Act (sec-
tion 3(1) and section 35(c)), that, unless a con
trary intention appears, the repeal of an enactment
does not "affect any right . .. acquired ... [or]
accruing 2 ... under the enactment ... repealed".
In my view, notwithstanding my great respect for
the contrary view of the Umpires, this rule of
interpretation has no application. The only sub
stantive "right" conferred on an insured person, as
I read the statute, is that right which has accrued
when those things have happened that entitle him
to be paid benefit, and the provision that a person
for whom a benefit period is established is "enti-
tled to benefit in accordance with this Part"
merely creates an expectancy that is no different
in kind from the expectancy of an insured person
who is still employed. 3 They are both entitled to
benefit in accordance with Part II of the Act as it
exists from time to time. That type of expectancy,
just like the expectancy of a middle aged person to
receive old age pension when he reaches the appro
priate age is, in my view, a "privilege or advan
tage" vested or granted by the statute and, by
virtue of section 34 of the Interpretation Act, the
Unemployment Insurance Act, 1971 must be con
strued as reserving to Parliament the power of
"revoking, restricting or modifying" any privilege
or advantage thereby vested in or granted to
insured persons.
The matter should not be left without referring
to chapter 11 of the Statutes of 1976-77, which
came into force on May 12, 1977. Apart from the
fact that the statute was not law when the Com
mission made the decision giving rise to these
proceedings, in my view, it does not apply, by its
terms, to alter the result in this case. In so far as
section 10 of chapter 80 of the Statutes of 1974-
75-76 is concerned, chapter 11's obvious applica-
2 What is meant by "accruing" as I understand it is typified
by interest on a loan payable at maturity.
3 Compare Reilly v. The King [1934] A.C. 176 at p. 180,
where it was held that such a rule of interpretation did not aid
a person appointed to a statutory office for a term during which
the statute was repealed.
tion is to the case of a person whose benefit period
was established before January 1, 1976, and who
turned 65 after that time. See section 2(b) thereof,
which makes its application, in so far as section 10
is concerned, subject to the condition that the
insured person had his entitlement to benefit ter
minated by the application to him of section 10.
* * *
The following is the English version of the
reasons for judgment delivered orally by
PRATTE J.: This section 28 application is direct
ed against the decision of an Umpire under the
Unemployment Insurance Act, 1971 holding that
applicant was not entitled to the unemployment
insurance benefits that he was claiming.
Applicant lost his employment on July 12, 1975.
He was then entitled to receive unemployment
insurance benefits during the benefit period which
the Commission was to establish for him at his
request, provided that he satisfied the conditions
specified by the Act.
Applicant complied with the Act and the Com
mission established his benefit period, which was
to expire several months after February 1, 1976.
It was, however, subject to termination at an ear
lier date under section 31(3), which then read as
follows:
31. ...
(3) Any benefit period established for a claimant under this
Part if not earlier terminated under this Part, terminates at the
end of the week in which
(a) he attains the age of seventy years, or
(b) a retirement pension at any time becomes payable to him
under the Canada Pension Plan or Quebec Pension Plan,
whichever first occurs.
Applicant was born on December 18, 1906. He
would not attain the age of seventy years, there
fore, until December 1976 and was not affected by
section 31(3)(a). Since the pensions referred to in
section 31(3)(b) could be paid from the age of
sixty-five years, however, the benefit period estab
lished for him could be terminated prematurely
under this section. Applicant did in fact begin
receiving a pension under the Quebec Pension Plan
at the beginning of February 1976. At that time,
however, the Act was no longer the same. Section
31 was amended as of January 1, 1976, 4 and the
provisions of section 31(3) were repealed and
replaced by the following:
31. ...
(4) Any benefit period established for a claimant under this
Part, if not earlier terminated under this Part, terminates at the
end of the week in which he attains the age of sixty-five years.
The Commission paid applicant the benefits to
which he was entitled from the beginning of his
unemployment until February 1, 1976. After that
date, however, the Commission refused to pay him
any benefits because, from that time on, he was
receiving a pension under the Quebec Pension
Plan. It is this refusal by the Commission that the
Umpire upheld in the decision now under appeal.
In my view this decision is without merit and
should be set aside.
The benefits claimed by applicant are those to
which he would be entitled for a period of unem
ployment subsequent to February 1, 1976. In order
to determine whether he is entitled to these ben
efits it seems to me that reference must be made to
the Act as it existed at that time, not as it had
existed previously. It is in fact at that time that the
right cited by applicant came into being. At that
time the Act no longer said that a claimant could
not receive unemployment insurance benefits if he
was receiving a pension under the Quebec Pension
Plan, since the provision to this effect found in the
Act had been revoked on January 1, 1976. It
seems clear to me therefore that applicant could
not be deprived of the right to receive the benefits
he claimed by reason of the fact that after January
1, 1976 he had received a pension from the Quebec
Pension Plan. The only provision of the Act that
could have been cited against applicant is section
31(4), which states that "Any benefit period estab
lished for a claimant ... terminates at the end of
the week in which he attains the age of sixty-five
years". However, careful reading of this provision,
which was enacted on January 1, 1976, shows that
it applies exclusively to persons who reach the age
4 S.C. 1974-75-76, c. 80.
of sixty-five years after that date, and not to those
who, like the applicant, reached it long before.
The reason for the Umpire's decision is that, like
other Umpires before him, he felt that when the
Commission established a benefit period for an
insured person that person thereby acquired a
right to the period thus established, the length and
conditions of which should therefore normally be
governed by the Act as it existed at the time the
period was established. In my view, this is incor
rect. The establishment of a benefit period does
not give rise to any right. It is only a formality that
must necessarily be carried out so that an insured
person can subsequently acquire the right to
receive benefits.
For these reasons, I would find in favour of the
application, set aside the decision of the Umpire
and refer the case back to him to be decided on the
basis of the assumption that applicant's right to
the benefits he claims should be determined by
applying the Act as it has existed since January 1,
1976.
* * *
RYAN J. concurred.
You are being directed to the most recent version of the statute which may not be the version considered at the time of the judgment.