On February 8, 2008, the Court of Appeal of Québec rendered a decision that may open the door to more substantial sentences for violations of the right to privacy. In fact, the court intervened to boost one award of punitive damages to $125,000.

Facts and Judgments of the Superior Court

First of all, it is important to understand the context of the Superior Court's decision.

In 2001, Mr. André Veilleux had instituted an action against Penncorp Life Insurance Company ("Penncorp") seeking payment of disability benefits that Penncorp had ceased to pay him, which has been granted.

In May and August 2002, for the purposes of the upcoming trial, Penncorp retained an investigator who filmed Mr. Veilleux and his son on their private property from a public observation tower used for deer watching, located at about 600 metres from Mr. Veilleux's house.

During the September 11, 2006 trial and in its February 2003 judgment, the Superior Court refused to admit the evidence produced by this shadowing of Mr. Veilleux in May and August 2002 that Penncorp wanted to use at the trial. The court had then found that Penncorp had no reasonable cause to subject Mr. Veilleux to surveillance. In fact, according to the court, Mr. Veilleux's behaviour had never been suspect, and there was no contradiction between the doctor's examinations and Mr. Veilleux's conduct.

In spite of this ruling that dismissed the shadowing evidence, Penncorp once again called upon the services of an investigator to conduct filmed surveillance of Mr. Veilleux on his farm after it received some information regarding Mr. Veilleux's activities, namely the acquisition of farm equipment.

Mr. Veilleux and his son launched proceedings in August 2005 against Penncorp for intentional affront to their privacy and dignity due to the shadowing conducted without their knowledge.

In this action, they demanded moral and punitive damages.

Penncorp then alleged in its defence that it was justified in requesting that Mr. Veilleux be shadowed while on his farm and using the equipment to work. According to Penncorp, Mr. Veilleux and his son had not really suffered any prejudice.

In a decision rendered in September 2006, the Superior Court found partly in favour of Mr. Veilleux and his son, and awarded moral damages for infringement of the right to privacy, as there was no serious or reasonable cause to use this surveillance method.

Thus, moral damages of $7,500 were awarded—$5,000 to Mr. Veilleux and $2,500 to his son, Martin.

However, the Superior Court did not award punitive damages for the surveillance conducted in May and August 2002 due to the fact that they were not intentional; that is, there was no intent to injure. Nonetheless, Mr. Veilleux was awarded $25,000 in punitive damages for the June 2003 surveillance, in keeping with the first judgment of the Superior Court declaring such evidence to be inadmissible.

Mr. Veilleux, his son and Penncorp appealed this last decision.

Ruling of the Court of Appeal

The basic principles retained by the Court of Appeal are as follows:

  1. It is established that surveillance does not necessarily constitute an unlawful infringement of the right to privacy protected by Section 5 of the Charter of human rights and freedoms;

  2. Surveillance evidence may be admissible where warranted by rational cause and conducted using reasonable means within the meaning of Section 9.1 of the Charter;

  3. The measure of surveillance must appear necessary in order to verify the person's conduct, and must be conducted as unintrusively as possible;

  4. There is intentional interference, as that notion is described in Section 49(2) of the Charter, if the person guilty of the unlawful interference has a state of mind that indicates a desire or will to cause the consequences of his or her wrongful conduct, or else if he or she acts in full knowledge of the consequences, be they immediate, natural or at least extremely probable, that this conduct would engender.

The Court of Appeal confirmed that the May 2002 surveillance did constitute an unlawful infringement on the privacy of Mr. Veilleux and his son, thus giving rise to compensation for the moral prejudice resulting therefrom. Indeed, the shadowing was not founded on any serious or reasonable cause warranting the use of this method.

Though it was unfounded, this infringement was not intentional, since the surveillance was never performed with the intent to cause any harm whatsoever.

According to the Court of Appeal, the situation of the August 2002 surveillance is different. This surveillance occurred after the Superior Court refused Penncorp the right to an out-of-time examination and medical exam, the court having considered that all of the relevant facts were already in the record. Since then, according to the Court of Appeal, Penncorp should have known that it could not continue to conduct surveillance of Mr. Veilleux without his knowledge at his place of residence.

In so doing, Penncorp was in fact simply trying to circumvent the effects of this judgment by conducting surveillance not because it was necessary and because Penncorp had reasonable cause, but because Penncorp had been prevented from examining and questioning the appellant again. The evidence showed that the premises observed were neither public places nor premises that could be viewed by neighbours or passers-by.

Penncorp was not motivated by hatred or malice, but rather by an "unhealthy economic interest" which, in this context, is comparable to ill-will. As a result, this infringement on privacy was intentional and Penncorp had to be sentenced to punitive damages.

Finally, regarding the June 2003 surveillance, the Court of Appeal deemed that the awarding of punitive damages was completely justified. In requesting this surveillance, Penncorp disregarded two decisions of the Superior Court condemning the previous surveillances.

Penncorp attempted to justify this decision by claiming that it believed the judges to have misunderstood the evidence. In taking for granted that the judges had misunderstood the law, Penncorp flouted the judgments with the admitted intention of taking justice into its own hands, and this conduct was unreasonable. It had thus acted "in full knowledge of the consequences", justifying the awarding of punitive damages.

Furthermore, the Court of Appeal found that the seriousness of the fault (unlawful and repeated surveillance in total disregard of the Superior Court judgments) and the respondent's significant financial means called for punitive damages much higher than those awarded by the Superior Court.

The Court of Appeal thus intervened to increase the punitive damages from $25,000 to $125,000:

  1. $25,000 for the August 2002 surveillance;

  2. $100,000 for the June 2003 surveillance.

In conclusion, the point to remember is that the Court of Appeal intervened to provide the courts of first instance with guidelines ensuring the respect of the fundamental rights of individuals by legal persons, particularly those that have significant financial means.

Moreover, a trend has emerged in the Court of Appeal case law in recent years, prompting this court not to hesitate to increase the quantum of punitive damages awarded by the lower courts when it deems it appropriate. These Court of Appeal interventions should have an impact in the medium term on increasing the amount of punitive damages awarded for violations of fundamental rights, particularly, as in this case, the right to privacy.

This article included the special participation of Claude Dallaire and Guillaume-Pierre Michaud.


The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.