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Ottawa has until Friday to decide whether it will appeal a Federal Court decision to uphold a pair of human-rights-tribunal orders regarding Indigenous children.Nathan Denette/The Canadian Press

Ottawa must decide this week whether to appeal a ruling upholding two human-rights-tribunal orders that would result in billions of dollars in compensation for Indigenous children, a choice that will be closely watched for the Liberal government’s commitment to reconciliation.

The decision needs to be made by Friday, which marks one month since Federal Court Justice Paul Favel ruled the federal government had not shown the orders from the Canadian Human Rights Tribunal were unreasonable.

The next step in the legal battle is taking place at a politically thorny moment for Prime Minister Justin Trudeau, while the issue of reconciliation with Indigenous peoples has come into greater focus for the country with the revelations of unmarked burial sites of former residential school students.

The extent of Mr. Trudeau’s personal commitment on reconciliation, a signature pledge of his government since 2015, has also come into question recently by a number of Indigenous leaders since he vacationed in Tofino, B.C., on the inaugural National Day for Truth and Reconciliation, for which he has apologized.

If Ottawa decides to appeal the Federal Court’s decision, it will be heavily criticized by Indigenous leaders, advocates and opposition parties for being out of step with reconciliation. If it opts to accept the ruling, there are sweeping implications that include the tribunal’s powers to compel government and the billions in compensation dollars to be paid.

Indigenous leaders, opposition parties and representatives for organizations such as the Canadian Bar Association have called on the federal government to forgo further legal action against the CHRT orders. One of the orders focuses on compensation for Indigenous children and their families and the other pertains to eligibility criteria for First Nations children in accessing services.

Murray Sinclair, the former chair of the Truth and Reconciliation Commission, which spent six years examining the effects of residential schools in Canada, was adamant in saying that Ottawa should not appeal Justice Favel’s decision.

The former senator, who served as a judge in Manitoba, said in an interview with The Globe and Mail that the Liberals have gone on record saying they’re trying to improve their relationship with Indigenous peoples and that they’re attempting to change the way government operates.

“I am really quite ticked at this government for doing this to children,” he said.

Mr. Sinclair also said that if there is an appeal, he will speak out against it, but he expects one to be filed. He added that if he was a minister or the Prime Minister, he would tell Department of Justice lawyers to “back off.”

The First Nations Child and Family Caring Society was one of the two organizations, along with the Assembly of First Nations (AFN), that brought forward the original complaint to the tribunal. Sarah Clarke, a lawyer representing the organization, said in an interview that on an individual basis what is at stake is ensuring First Nations children and families are acknowledged properly and that they have been harmed by Canada’s conduct.

“More broadly, I think, what’s at stake is really trying to understand whether this government truly understands what reconciliation is and truly is taking responsibility, at least in part, for the harm that it has caused these kids and families,” she said.

Ms. Clarke also said her team is preparing for an appeal should there be one.

In 2019, the CHRT ordered Ottawa to provide up to $40,000 to each First Nations child unnecessarily taken into care on or after Jan. 1, 2006. The order also required payments to parents or grandparents, and children denied essential services. In its findings, the tribunal said the federal government wilfully and recklessly discriminated against Indigenous children living on reserve by failing to provide funding for child and family services.

At the time of the decision, the AFN said more than 54,000 First Nations children could be eligible for compensation as a result.

In 2020, the tribunal also released findings on broadening criteria for what is known as Jordan’s Principle, named after a five-year-old boy who died in hospital in 2005 after a lengthy battle between the federal and Manitoba governments over home-care costs. The principle is designed to ensure First Nations children can access services and supports they need when they need them.

The tribunal said its eligibility criteria should include a child who is registered or eligible to be registered under the Indian Act, a child who has a parent or guardian registered under the Indian Act, a child recognized by their community for the purposes of Jordan’s Principle, and a child who is ordinarily a resident on reserve.

The tribunal orders were examined by the Federal Court because Ottawa decided to request a judicial review to seek clarity over the legal jurisdiction of the tribunal to make these particular findings.

During court proceedings in June, Robert Frater, a lawyer for the Attorney-General of Canada, said the government acknowledged the need to reform its child-welfare policies and programs, and recognizes old policies caused harm. Mr. Frater also said Ottawa recognized the need to compensate those who were affected.

But he said the need to redress those wrongs and prevent them from happening again did not justify the tribunal’s orders. Mr. Frater argued the CHRT’s decisions were reached through a flawed chain of reasoning. The federal government also argued the tribunal erred by ordering the same monetary compensation to all of the First Nations children, parents and grandparents.

In a ruling released on the eve of the National Day for Truth and Reconciliation, Justice Favel found the tribunal reasonably exercised its discretion under the Canadian Human Rights Act to handle a “complex case of discrimination to ensure that all issues were sufficiently dealt with and that the issue of compensation was addressed in phases.”

He said the tribunal properly considered the record to determine whether to award damages for willful and reckless conduct and there was more than enough evidence in the form of reports to ground this finding.

If there is further litigation, the next legal stage would be at the Federal Court of Appeal. The following step would be the Supreme Court of Canada.

Mr. Trudeau said last Monday that the government has not yet decided whether to appeal the Federal Court’s ruling, but he reiterated his government remains committed to compensating First Nations children.

Separately, the federal government has filed a request for judicial review in Federal Court of a different finding from the CHRT on payment for capital purchases and/or construction required to support the delivery of child-welfare services.

Cindy Blackstock, the executive director of the First Nations Child and Family Caring Society, said she will not stop fighting for the rights of First Nations children and the “government cannot be above the law.”

“It is very dangerous for a government to be able to make the claim that human-rights obligations exist for everybody else but not for the government itself.”

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