The Supreme Court of Canada has released its much-anticipated decision Democracy Watch v. Canada (Attorney General), 2026 SCC 28. This is a watershed case that underscores the significance of the rule of law to Canada’s constitutional structure. It will have implications for all persons and entities that interact with government tribunals in the course of business, because it confirms that courts have the final word on whether government conduct is legal.
The origins of the Supreme Court’s ruling go back to the 2021 report of the federal Conflict of Interest and Ethics Commissioner, which had concluded that then Prime Minister Trudeau had not contravened the Conflict of Interest Act, S.C. 2006, c. 9. s. 2. A national non-profit organization, Democracy Watch, sought to challenge the Commissioner’s report in the Federal Court of Appeal through a court process known as “judicial review”. But the Conflict of Interest Act contained what is known as a “privative clause” —essentially, a statutory bar against judicial interference with the Commissioner’s report on certain grounds. A full panel of the Federal Court of Appeal declined to hear Democracy Watch’s case, ruling that the privative clause should be respected and that the matter should instead be left to unfold under the accountability mechanisms of the political process.
Democracy Watch took the issue to the Supreme Court of Canada, represented by two of the country’s leading administrative law professors. In the Democracy Watch ruling released last week, the Supreme Court unanimously overturned the Federal Court of Appeal. It held that, as a matter of constitutional law, administrative decisions by government must be reviewable by courts for legality. As a result, the privative clause in the Conflict of Interest Act was held to be unconstitutional, and the Supreme Court struck it down. Democracy Watch will, as a consequence, be allowed to proceed with its challenge in the Federal Court of Appeal.
The Supreme Court of Canada’s opening words set a historic tone. The Court confirmed that the rule of law is a “fundamental postulate of our constitutional structure”:
Under the rule of law, all public powers must be legal, and all legal powers have limits. These limits are set out in the delegating statute, in the common or civil law, or derived from the Constitution itself. An unlimited power is, definitionally, not a legal power[1].
In allowing Democracy Watch’s appeal, the Court first held that the Federal Court of Appeal was wrong to find that political oversight mechanisms embedded in the Conflict of Interest Act’s scheme provided Democracy Watch with an adequate alternative remedy to judicial review. It concluded political accountability was not enough in the circumstances.
Next, the Court concluded that the Canadian Constitution requires and guarantees a minimum core of legality review over “all aspects” of any kind of administrative decision. This is an important finding that resolved decades of debate by courts and academics. The Court held that legislative efforts to limit legality review are unconstitutional “because the Constitution guarantees the courts’ role in ensuring that all exercises of public power, as they manifest in all aspects of an administrative decision, are sourced in law.” Applying this principle in the case before it, the Court ruled that Parliament could not constitutionally oust judicial review for questions of fact and law under the Conflict of Interest Act. That provision was of no force or effect.
The fallout from Democracy Watch will be profound. In the immediate years to come, it is not a bold prediction to say privative clauses in federal, provincial and territorial legislation that purport to oust the minimum core of judicial review will likely be the subject of further constitutional challenges.
Fasken was pleased to act for the Centre for Free Expression in its intervention in the Democracy Watch case. The Centre intervened to support the Court in its analysis of the doctrine of adequate alternative remedy, and many of the Centre’s submissions are reflected in the Court’s reasons. If you require advice on the implications of Democracy Watch for your business, we invite you to contact the authors below.
