Federal Court of Canada rules clawback of disabled Veterans pension illegal

HALIFAX, May 1, 2012 /CNW/ - After over five years of legal struggle, Canada's disabled veterans received a favourable decision from the Federal Court of Canada in their class action lawsuit against the Government of Canada.

Canadian veteran and lead plaintiff Dennis Manuge addressed media in Halifax today and expressed his pleasure with the favourable ruling.

"On behalf of Canada's disabled veterans, we are very pleased with this decision," said Mr. Manuge. "I now expect the Government of Canada to do the right thing—accept the Federal Court of Canada's decision and move quickly to implement it."

The Class Action was initiated in March of 2007 on behalf Dennis Manuge and all other disabled veterans whose SISIP Long Term Disability Benefits are reduced by the amount of the monthly VAC (Veterans Affairs Canada) Disability Pension they receive under the Pension Act.  The Class has more than 4,500 members.

"These soldiers have fought long enough—on the battlefield, before the ombudsmen, before the House of Commons and the Senate, and now before the courts," said Peter Driscoll, lead counsel, McInnes Cooper. " It is time to put an end to this war."

The Honourable Mr. Justice Robert Barnes, in his decision wrote the following:

Para [63] Giving effect to the SISIP offset of Pension Act disability benefits wholly deprives disabled veterans of an important financial award intended to compensate for disabling injuries suffered in the service of Canadians. The SISIP offset effectively defeats the Parliamentary intent that is inherent in the Pension Act which is to provide modest financial solace to disabled CF members for their non-financial losses. The approach adopted by the Defendant does not lead to a fair or sensible commercial result and defeats the reasonable expectation of CF members. CF members looking at the SISIP Policy and, in particular Article 24, would expect that they were obtaining a meaningful and not illusory LTD benefit payable over and above their Pension Act disability entitlement for the loss of personal amenities. This view is enhanced by the fact that disabled CF members who continue with their active service are entitled to be paid and to keep their Pension Act disability benefits and by the fact that they lose their right of action against the Crown to pursue claims to damages (including income losses) if a Pension Act benefit is payable: see Crown Liability and Proceedings Act, RSC 1985, c C-50, s 9. The practical consequence of the claimed offset is to substantially reduce or to extinguish the LTD coverage promised to members of the Class by the SISIP Policy with particularly harsh effect on the most seriously disabled CF members who have been released from active service. That is an outcome that could not reasonably have been intended and I reject it unreservedly.

"This has been a very difficult experience for Canada's disable veterans on a personal, emotional and financial level," said Mr. Manuge. "The Government of Canada has been illegally taking advantage of Canada's disabled veterans for far too long. Today's decision by the Federal Court provides hope for Canada's disabled veterans."

The Government of Canada has a moral, ethical and now a legal obligation to move quickly to implement this Federal Court decision.

"This ruling is a signal for the Government of Canada to stop illegally taking money away from Canada's disabled veterans and stop any legal action against disabled veterans who cannot afford to hand over more money," said Mr. Driscoll. "This is the time to start treating Canada's veterans with the honour and dignity they deserve."

For more information on the class action, please visit www.leavenovetbehind.ca or www.mcinnescooper.com.

Sandra Goodwin
Director of Client Services
McInnes Cooper
Office: 902.444.8438
Email: [email protected]

Sean Lewis
MT&L Public Relations
Office: 902-425-1860 x.225
Cell: 902-223-2782
Email: s[email protected]