Case Commentary: Nelson (City) v. Marchi, 2021 SCC 41 – The Supreme Court of Canada clarifies the distinction between core and non-core policy decisions

Introduction

In the recent decision of Nelson (City) v. Marchi, the Supreme Court of Canada clarified the law with respect to what constitutes a “core policy decision” rendering a government or public authority immune from liability.  In this particular case, the Court held that the City had not met its burden of proving that the plaintiff sought to challenge a core policy decision immune from negligence liability.  This decision is instructive in the determination as to when a government can be held liable for damage caused by their negligence in the same way as a private defendant.

Background Facts

During a heavy snowfall, the plaintiff Ms. Marchi, parked her car in the downtown core of the City of Nelson in an angled parking spot.  The City had recently plowed this area and in doing so, created a large snowbank that ran along the top of the parking stalls which created a barrier between the parking lot and the sidewalk.  The City did not clear a path to allow drivers parked in this area to access the sidewalk without crossing the snowbank.  Ms. Marchi walked across the snowbank in order to reach the sidewalk and her right foot fell through the snowbank, causing serious injuries.  The parties agreed that she was entitled to $1 million in damages.  In its defence, the City relied upon written and unwritten policies on snow removal and argued that its decisions were dictated by the availability of resources.

At trial, the British Columbia Supreme Court held that the City did not owe Ms. Marchi a duty of care.  The trial judge held that the City’s snow removal policies and unwritten practices fell within the ambit of a core policy decision.  If there was a duty of care, the trial judge held that the City did not breach the corresponding standard of care and that, in any event, the City could not be held liable since the policy at issue was a core policy decision.

The Court of Appeal allowed Ms. Marchi’s appeal, holding that the trial judge erred in concluding that the City’s snow removal decisions were core policy decisions, and that the City did not owe Ms. Marchi a duty of care.  A new trial was ordered in order to address these issues, as well as errors with the standard of care and causation analysis.

The City appealed the Court of Appeal’s decision to the Supreme Court of Canada.

The Supreme Court of Canada’s Decision

The Supreme Court used this case as an opportunity to clarify the distinction between core and non-core policy decisions.  Specifically, the Court stated that “this appeal requires the Court to clarify how to distinguish immune policy decisions from government activities that attract liability for negligence.”

For the purposes of assessing liability, government decisions and actions are separated into two categories: core policy decisions and non-core policy decisions.  Core policy decisions are shielded from liability, whereas non-core policy decisions are not.  The underlying policy rationales for shielding a government from liability for core policy decisions are to honour the separation of powers and uphold the executive and legislative branch’s institutional roles.

The Court first engaged in a duty of care analysis to determine whether the trial judge erred in determining that the City did not owe a duty of care to Ms. Marchi.  The Court determined that the pre-existing duty of care established in Just v. British Columbia, [1989] 2 S.C.R. 1228 (“Just”) was analogous.  In Just, the plaintiff’s car was hit by a boulder that fell off a hill that was positioned above a public highway.  In that decision the Court held that the municipality owed the plaintiff a duty of care to properly maintain the public highway.

For the core policy vs. non-core policy analysis, the Court in this decision noted the definition of a core policy decision shielded from negligence as follows: “decisions as to a course or principle of action that are based on public policy considerations, such as economic, social and political factors, provided they are neither irrational nor taken in bad faith.”  Core policy decisions are a “narrow subset of discretionary decisions” because discretion “can imbue even routine tasks” and protecting all discretionary government decision would therefore cast “the net of immunity too broadly”.  Core policy decisions differ from operational decisions, which have been defined as the performance of policies or practical implementation of core policy decisions.

The Court identified four factors to be used to identify core policy decisions:

1. the level and responsibilities of the decision-maker;
2. the process by which the decision was made;
3. the nature and extent of budgetary considerations; and
4. the extent to which the decision was based on objective criteria.

The Court also provided two further points of clarity with respect to the application of this test.  Firstly, financial implications alone do not automatically classify an action as a core policy decision.  The mere presence of budgetary, financial, or resource implications does not determine whether a decision is one of core policy.  Secondly, the mere mention of the word “policy” does not automatically designate an action as a core policy decision since this term encompasses a broad range of meaning.  The Court again emphasized that the nature of the decision itself should be scrutinized as opposed to the mere presence of financial implications or the term “policy.”

Take Away

Merely because a government identifies a decision as a “core policy” decision does not necessarily make it so.  The nature of the decision must be carefully scrutinized on a case-by-case basis to determine whether the decision qualifies as a true policy decision entitling the government to tort immunity.  This is a key consideration for plaintiffs suing governments and private defendants named in litigation with the government as a co-defendant.