Archived [2008-09-01] - Policy on the Indemnification of and Legal Assistance for Crown Servants

1. In order to be entitled to obtain indemnification, and to be eligible to receive legal assistance, a Crown servant must:
   1. inform the employer of the matter at the earliest reasonable opportunity after the servant becomes aware of a possible or actual claim or proceeding as a result of any alleged act or omission within the scope of the servant's duties or employment;
   2. make a complete report to departmental management of the incident leading to the requirement for indemnification or legal assistance; and
   3. upon request by the employer, authorize the Attorney General, or anybody designated by the Attorney General, to defend their action using the appropriate forms as set out in Appendix A.
2. In order to obtain legal assistance referred to in section 4(f), the respondent of a complaint of harassment that was determined to be unfounded at the departmental level must
   1. inform the employer at the earliest reasonable opportunity after he or she becomes aware that the complaint is pursued in a court or tribunal; and
   2. upon request by the employer, authorize the Attorney General, to defend the action using the appropriate forms as set out in Appendix A.

1. Deputy heads have the authority to approve indemnification and the provision of legal assistance that is provided by the Department of Justice Canada or private counsel. For indemnification and legal assistance intended for former and serving ministers, including prime ministers, deputy heads and ministers' exempt staff, the approval level identified in section 7.2(d) is to be obtained.
2. Except for legal assistance referred to in section 4(f), the approval authority, or authorized delegate, can only authorize legal assistance at public expense when it has been determined that the servant acted honestly and without malice within his or her scope of duties or employment and met reasonable departmental expectations. This criterion applies initially at the time of the request for legal assistance and during the ensuing proceedings.
   
   The determination that the servant acted honestly and without malice within his or her scope of duties or employment and met reasonable departmental expectations should be made by departmental officials before legal counsel meets with the servant. This determination is required in order to avoid precluding the Department of Justice Canada counsel from providing future legal advice to the department due to the fact that the servant would have provided information in confidence that could result in a conflict of interest situation for the Justice counsel.
   
   
3. Where a situation occurs that does not fall within the basic criteria for indemnification (i.e. that the servant acted honestly and without malice within his or her scope of duties or employment and met reasonable departmental expectations) nor under section 4(f) and there are extenuating circumstances, the appropriate approval authority may determine the extent to which a servant may be indemnified and may receive legal assistance. In this case and where the approval authority is the deputy head, the full amount of the indemnification, including legal assistance costs, must not exceed $25,000 subject to section 7.3.4. Where the full amount exceeds $25,000, Treasury Board approval is required. Where the approval authority is other than the deputy head (i.e. the Prime Minister, Clerk of the Privy Council or Treasury Board), the designated authority will have full authority.
4. Special approval levels are required to cover indemnification and legal assistance provided by the Department of Justice Canada or private counsel for former and serving ministers, including the prime minister, deputy heads, or ministers' exempt staff. The estates of these individuals are also subject to these approvals. The approval authorities are as follows:
   1. for ministers, the approval authority is the prime minister;
   2. for deputy heads and equivalents, the approval authority is the Clerk of the Privy Council or delegate;
   3. for ministers' exempt staff, the approval authority is the Treasury Board.

Note:

Under no circumstances is legal assistance to be authorized for claims or actions initiated by Crown servants.

A summary of the appropriate approval authorities is provided in Appendix C.

7.3.1 Advice to be sought

1. Before approving a request for legal assistance, the approval authority must seek the advice of the Department of Justice Canada on the need for legal counsel and legal assistance, and on the appropriateness of the source of this assistance – either a counsel of the Department of Justice Canada, a Department of Justice Canada agent or, if relevant, private counsel or other person providing the legal assistance.
2. In certain cases, such as possible conflict of interest, the Attorney General could either decline to appoint counsel to act on behalf of a servant or instruct counsel to discontinue so acting whether or not, under this policy, legal assistance has been authorized or the servant is or may be entitled to be indemnified.
3. When the Department of Justice Canada determines that there is a conflict of interest, or where the servant is charged with an offence, the servant may be authorized to engage private counsel or to seek other legal assistance.

7.3.2 Instructing counsel

1. In any claim or proceeding, the Attorney General of Canada has the authority to select and instruct counsel to conduct the defence on behalf of the servant. Such counsel shall, to the greatest extent possible consistent with counsel's obligation to protect the interests of the Crown, treat all communications with the servant in confidence. The Crown will not use information so disclosed in confidence by the servant in any disciplinary or civil action against the servant.
2. The name and fee schedule of private counsel or other legal assistance must always be approved by the Attorney General of Canada before proceeding in such cases.

7.3.3 Servant's personal responsibility

1. In civil cases, servants must state in their request whether they are willing to have the Department of Justice Canada defend them. A servant who prefers to be represented by private counsel shall state the reasons for the preference and provide the name and fee schedule of the preferred counsel. Private counsel shall not be retained until the appropriate approval authority has approved the request. A servant who instructs counsel to begin work without the requisite approval is personally responsible for payment of the resulting legal fees.
2. Where the approval authority is not satisfied that the choice of counsel is reasonable, the servant should be asked to provide another preference. Alternatively, the servant may choose to retain the counsel originally selected, in which case he or she will be personally responsible for any part of the fee deemed excessive by the approval authority.
3. When a servant has chosen to engage private counsel and, in the opinion of the Department of Justice Canada, there is no conflict of interest or other factor preventing the conduct of the defence by the Department of Justice Canada, the payment of legal fees, costs, and any judgement are the servant's own responsibility. If the employing department feels that there are extenuating circumstances, it may make a submission to the Treasury Board for partial or full reimbursement.

7.3.4 Costs of private counsel

1. In cases where private counsel is to be engaged, basic policy criteria are met and the approval authority is the deputy head, the deputy head may authorize the payment of legal fees and disbursements to such counsel to a maximum of $10,000 including the cost of travel pursuant to the Treasury Board Travel Directive. Subject to section 7.2(c), the approval of the appropriate minister must be obtained to exceed this limit with respect to any one servant in any one incident, or before any fee in excess of $1,200 per diem may be paid. If there is a reasonable expectation that the process will be lengthy with legal costs regularly requiring departmental review and ministerial approvals, and if the legal rates have been approved by the Minister, individual ministerial approvals of each charge over the maximum amounts noted is not required. Measures to ensure the Minister is regularly informed of the status and costs of the process are to be implemented.

   With respect to private counsel intended for former and serving ministers, including prime ministers, deputy heads and ministers' exempt staff, approval of the appropriate authority as outlined in section 7.2(d) must be sought.

2. An authorization to pay all or part of a servant's expenses for private counsel is to be in writing and is subject to the following conditions:
   1. the servant's selection of counsel is to be approved, in accordance with this policy, before counsel is engaged;
   2. the department is to inform the servant and the selected counsel in writing of the limits of the Crown's commitment, in terms of both total expenditures and approved fee schedules, and of the requirement for reviewing accounts by the Department of Justice Canada;
   3. in cases involving offences, payment by the Crown shall not include any fine or costs of prosecution; and
   4. if, at any time during the proceedings, it is determined that a servant who has received legal assistance was not acting within his or her scope of duties or employment at the time the act or omission for which the legal assistance was provided took place, legal assistance is to cease and any assistance provided is to be recovered. It is therefore necessary to ensure that servants are aware of, and accept, this condition before the legal assistance is provided. This reimbursement process applies to all legal assistance provided, not just the costs of private counsel.

7.3.5 Stages of the judicial process

For each stage of the judicial process or for any significant change in the circumstances related to the case, a new request for payment of legal fees must be made and assessed in accordance with the considerations set out in section 7.3. Servants who instruct counsel to begin work on a subsequent stage of the process without proper approval may be personally responsible for the resulting legal fees.

In civil cases, the Department of Justice Canada will, in most instances, assume the provision of legal assistance including the conduct of the litigation, either through a departmental legal adviser or a private lawyer retained as an agent of the Attorney General. In these circumstances, the Minister of Justice, rather than the servant, will have ultimate responsibility for selecting and instructing counsel. In cases where two or more servants are sued in the same action, normally the same counsel will conduct their defence.

It is the practice of the government to pay out of public funds any judgement, including costs, against the servant as long as the servant is entitled to indemnification under this policy.

Indemnification and legal assistance costs are to be paid from the budgets of the organization in which the person worked at the time the incident(s) occurred. If the organization no longer exists, the organization that continues to carry out the responsibilities related to the act or omission for which indemnification and legal assistance have been required should bear the financial costs.

Legal assistance is not to be approved or paid as an ex gratia payment. The policy on ex gratia payments does not permit the use of the ex gratia payment process when other policies apply to the situation. Thus, should circumstances arise where the provision of legal assistance seems appropriate but is not possible within the provisions of this Policy on the Indemnification of and Legal Assistance for Crown Servants, an exception to this policy is to be requested from the Treasury Board.

This policy is issued pursuant to section 7 of the Financial Administration Act.

This policy should be implemented within the context of risk management. Refer to the Risk Management group of Treasury Board policies available through the Treasury Board of Canada Secretariat web site at http://www.tbs-sct.gc.ca/

The manual Administrative Practices – Guidelines for Ministers' Offices may assist those persons who are involved in answering questions related to indemnification and legal assistance for ministers and ministers' exempt staff.