Canada agreed to 'forever discharge' Catholic entities from pay-out to residential school survivors

Canada agreed to "forever discharge" Catholic entities from their promise to raise $25 million for residential school survivors and also picked up their legal bill, a final release document shows.

The Canadian Press obtained a signed copy of the 2015 agreement through federal Access-to-Information laws, marking what appears to be the first time the document has been widely publicized.

"That's a very, very important set of records," said Ry Moran, an associate librarian at the University of Victoria and founding director of the National Centre for Truth and Reconciliation.

"Like all questions around accountability … the question is who made the decision? How was that decision made? Who ultimately signed off on this?"

Indigenous leaders and legal experts have long questioned why Ottawa opted to give up an appeal of a court decision that meant Catholic entities didn't have to pay their remaining financial obligations under the historic Indian Residential School Settlement Agreement.

The actions of the Catholic groups involved — and by extension, the Catholic Church as an institution — as well as Ottawa, have been under renewed scrutiny since the uncovering of what are believed to be hundreds of unmarked graves at former residential school sites, which First Nations began announcing last year.

The dispute in question arose years before and culminated in a court decision handed down by a Saskatchewan judge in July 2015.

The residential schools settlement obligated the 48 Catholic entities involved to pay $79 million, which was broken into three parts, including making "best efforts" to raise $25 million for residential school survivors.

There was a disagreement between Ottawa and the Catholic entities about one part of their obligations.

At issue was whether lawyers for both sides had struck a deal freeing the church groups from all their financial commitments — including the $25 million for survivors — in exchange for a payment of $1.2 million, or only had an agreement covering a more narrow part of their financial responsibilities.

Ultimately, Justice Neil Gabrielson ruled the agreement covered all the church's financial commitments, allowing Catholic entities to walk away from their fundraising promise to survivors after raising less than $4 million.

Records obtained by The Canadian Press show that a month after that July 2015 decision, federal officials filed a "protective notice of appeal" while negotiating a final release agreement with the Catholic groups.

By Oct. 30, 2015, a final agreement was signed by the former deputy minister in what had been called Aboriginal and Northern Affairs Canada, freeing the Catholic entities of their financial obligations.

"Canada does hereby remise, release and forever discharge the Catholic entities … its directors, officers, shareholders, agents, lawyers, and employees … of and from all manners of actions, causes of action, suits, debts, dues, accounts, bonds whatsoever against the releasees," it reads.

It continues: "Canada further covenants and agrees not directly or indirectly to join, assist, aid, or act in concert in any manner whatsoever with any person or entity in making any financial claim or demand whatsoever against the releasees."

The signed agreement was released as part of more than 200 pages of briefing documents and court records prepared for Crown-Indigenous Relations Minister Marc Miller last fall after he committed to finding out what happened that led Canada to abandon its appeal. Many of the government records were redacted either in part, or in full.

Miller has, in at least one media interview, expressed openness to the idea of reviewing the government's 2015 decision.

However, Canada's agreement to "forever discharge" the Catholic entities and the broad language of the signed document raise questions about whether that can happen.

"The minister committed to understanding the circumstances and events that led the appeal to be dropped by the government of the day," Miller's office said in a statement Friday.

"He further committed to ensuring that the Catholic Church be held to account."

A spokesperson also deferred questions to the Department of Justice about the legal fees paid by Canada.

Government documents suggest the decision to appeal hinged on whether the Catholic entities would try to relieve themselves further and broaden it to focus on their non-financial commitments under the settlement agreement.

"Should discussions around the order result in a release that is limited to three financial obligations, Canada will not pursue the appeal," reads a document dated September 2015. It included an illegible signature from a former minister in Stephen Harper's Conservative government, which at the time was in the middle of a federal election campaign.

Miller said it belong to Bernard Valcourt, Harper's former minister of aboriginal affairs.

The document noted releasing them from some of their non-financial obligations "could pose significant risk for Canada."

"Of particular concern to Canada would be releasing the Catholic entities from obligations such as co-operating in the defence or resolution of all Indian Residential Schools abuse claims outside of the settlement agreement."

While it said the court ruling could free Catholic entities from the "$21.5 million shortfall" of their fundraising campaign for survivors, "the likelihood of compelling the Catholic entities to meet their remaining fundraising obligations is very low."

Finally, the document said appealing would mean Canada would be back at "square one" when it came to trying to get any agreement in place over settlement money with the Catholic entities.

Ken Young, a former chief at the Assembly of First Nations and a residential school survivor, said he doubts Canada would have been successful in an appeal.

"Canada could have litigated until the cows came home," he said in a recent interview. "I think we're in a new phase."

Young, who is critical of how the Catholic churches' said fundraising would depend on their "best efforts," believes leaders have since learned their lesson.

He points to a promise made by the Canadian Conference of Catholic Bishops for dioceses to raise $30 million for reconciliation-related efforts over five years. As of July, they reported raising $4.6 million.

Young believes the bishops will keep their word, but said given the wealth of the Vatican and Catholic Church as an institution, fundraising shouldn't be necessary.

"Write a cheque today, never mind bothering your parishioners to raise it."

This report by The Canadian Press was first published Aug. 20, 2022