Justice Binnie suggested the lack of legal fora to resolve disputes can harm both victims of abuse and falsely accused companies. (Cristin Schmitz / The Lawyers Weekly) Click here to see full sized version.

Lawmakers should consider enacting new legislation that would enable Canadian companies to be sued domestically in superior court for alleged complicity in human rights violations abroad, says Supreme Court of Canada Justice Ian Binnie.

The judge said that Canada and many other nations have signed on to international treaties and conventions that guarantee various labour and human rights, yet most have not created fora to air and legally determine complaints that domestic companies have aided and abetted human rights abuses carried out by the governments of the foreign jurisdictions where they do business.

“The enforcement mechanisms for human rights have lagged,” Justice Binnie told a Canadian Bar Association/Department of Justice panel discussion on human rights Aug. 17.

 “My point simply is that you cannot have a functioning global economy with a dysfunctional global legal system: there has to be somewhere, somehow, that people who feel that their rights have been trampled on can attempt redress — and if the complaints turn out to be unfounded, so be it.”

Justice Binnie suggested that the upshot of what has been dubbed a “governance gap” is that people with bona fide claims of abuse have no recourse or remedy, while companies who are falsely vilified for alleged complicity in human rights abuses can not effectively clear their names.

“Talisman Energy was criticized very widely in the press for activities in the Sudan,” Justice Binnie noted.

However the Canadian company was able to produce evidence, during an action launched against it in New York District Court by some churches, that it was not complicit in human rights abuses by the government of Sudan.

“So my point is not to suggest that these allegations against the companies are in fact well-founded,” Justice Binnie stressed, “but only that it points to the need to have some forum in which this kind of complaint can be ventilated and resolved, and not [be] simply left as a dissatisfied local population squared off against a foreign company with no means of introducing a legal structure to look after the fall-out.”

Justice Binnie said that the International Commission of Jurists (ICJ), of which he is a Commissioner, would like to see “a network of domestic courts where these disputes can be resolved.”

“It is something I hope the Canadian authorities look at,” he told The Lawyers Weekly afterward. “Now whether or not they decide it’s a good idea, or a bad idea, is up to them. But it is not an issue that should be ignored.”

Indeed, there is growing pressure worldwide for the creation of fora and remedies to address the complicity of multinational corporations in rights abuses by the states where they do business.

Recently, for example, the European Parliament endorsed a resolution on corporate social responsibility. However, the issue has so far received little attention in Canada.

Justice Binnie noted in his speech that United States courts have assumed jurisdiction over such complaints, using the Alien Tort Claims Act, a 1789 statute created to address piracy, which empowers U.S. federal courts to try any civil action by an alien for a tort committed in violation of the law of nations or a treaty of the United States.

Consequently in 2005, for example, there was a multi-million-dollar settlement by a California oil giant with a group of Burmese farmers who were displaced as a result of a pipeline built by the company in Myanmar.

 “How much of that [money] stuck in the fingers of the Burmese colonels nobody knows,” Justice Binnie observed. “But from the point of view of finding a forum somewhere in the world in which complaints can be addressed, the courts in California and New York are really setting the benchmark.”

U.S. courts have even stepped in cases that didn’t involve American companies. Thus, a California district court recently accepted jurisdiction over claims against a U.K.-based mining company for alleged human rights violations in Papua, New Guinea.

Observed Justice Binnie, “the court in California said it may be a foreign company, and maybe the people before the court have no connection with us, but despite all of that we are going to take jurisdiction because nobody else seems prepared to do so.”

Justice Binnie said it may be questioned why a U.S. court would get involved in a case with no apparent connection to it, but noted that U.S. courts are presently “the only act in town.”

Calling the Alien Tort Claims Act “a very effective mechanism,” Justice Binnie suggested “if that legislation were replicated in more countries, there would be more avenues whereby companies could clear their names of allegations made against them, or complainants could obtain redress, depending on what the evidence shows.”

Justice Binnie is one of 60 eminent jurists around the world who are Commissioners of the ICJ, a Geneva-based organization with a mandate to promote and support the enforcement of human rights via the rule of law.

His comments anticipate the thrust of a soon-to-be released ICJ report on Corporate Complicity in International Crimes, which is presently being drafted by an international panel of corporate, criminal, environmental, human rights and labour law experts. They have been working since 2006 to develop legal and public policies in relation to corporate complicity in violations of international human rights and humanitarian law. Their pending report will recommend when companies should be held legally liable for complicity in gross human rights violations, and canvass what kind of situations prudent companies should avoid.

Justice Binnie quoted from the influential work of Harvard political scientist John Ruggie, who is the U.N. Secretary-General’s Special Representative for Business and Human Rights. Ruggie’s mandate is to propose measures to strengthen the human rights performance of the business sector around the world.

“Professor Ruggie puts the problem very succinctly this way,” observed Justice Binnie. “He says the root cause of the business and human rights predicament lies in the ‘governance gaps’ created by globalization between the scope and impact of economic forces and actors, and the capacity of societies to manage their adverse consequences. These governance gaps provide the permissive environment for wrongful acts by companies of all kinds without adequate sanctioning or reparation. He says there is no correspondence between the integrated multinational companies, and the dis-integrated judicial system.”

In response to a question from the audience, Justice Binnie said he does not consider “realistic” the idea of creating a World Court of Human Rights Abuses. Nor do criminal sanctions provide an avenue that would compensate those who suffer abuse, he said.

Instead, he can envision Canadian superior courts handling corporate complicity complaints against Canadian companies under new federal or provincial laws.

“Generally torts are provincial jurisdiction,” the judge noted “Superior courts would deal with it, and they would have to deal with the question as to whether they are the most appropriate court to deal with it [as compared to other possible fora]. It would depend on the degree of connection to Canada of the fact situation they are dealing with.”

Justice Binnie acknowledged that international cases of this type do pose significant challenges. “There would be all sorts of problems dealing with corporate structures,” he said. “Generally a company is not responsible for the default of its partially owned subsidiaries or its suppliers, unless there is an agency relationship. So it’s a very complex problem, but at the moment there is no satisfactory way of resolving it.”

Justice Binnie also pointed out that some sectors of the business community have recognized the problem of unresolved human rights complaints against industry. Thus individual industries hurt by public opprobrium, and economic backlash in relation to their foreign operations have set up their own monitoring mechanisms to prevent human rights abuses.

The diamond industry, for example, has created a certification process to guarantee that its products do not fuel conflict in the African nations where they mine raw diamonds.

“This suggests to me that [companies] don’t want to have all of these allegations floating around unanswered, and they have no effective way of answering it” in a legal forum, Justice Binnie said.