# 2015-228 - Article 203.04 of the Queen’s Regulations and Orders for the Canadian Forces (QR&O) imposes an unrealistic and unfair duty on CAF members, Delegated Authority under subsection 155(1) of the Financial Administration Act (FAA), Director Claims and Civil Litigation (DCCL), Legal Review of Overpayment Cases, Negligent Misrepresentation, Recovery of Overpayment/Debt Write-Off, Separation Expense (SE)

Case Summary

F&R Date: 2016–02–29

Upon notification that the grievor's service spouse was posted to a different location, the married service couple sought the guidance of the subject matter experts (SME) on Imposed Restriction/Separation Expense (SE) at the Canadian Forces Support Unit (CFSU) Section.They were advised that there was an automatic entitlement to SE for whichever one of them was separated from their household goods and effects (HG and E); and, it was up to the grievor and his spouse to determine who would keep the HG and E. The couple decided that the spouse would take the HG and E with her to the new location and the grievor subsequently received approval to claim SE.

However, a year later, it was discovered that the CFSU had relied on an expired policy in providing the grievor with advice and, in fact, there was no entitlement for him to claim SE. His SE was subsequently cancelled and he was required to repay the approximately $16,000 of SE he had received. The grievor argued that he relied on erroneous guidance as well as approval of his SE benefits to his detriment. Therefore, he should not be held liable for the negligent misrepresentation.

The CFSU supported the grievor and admitted to the errors made in advising him and in approving his SE. The initial authority (IA) acknowledged that it was regrettable that the grievor was erroneously advised. Nonetheless, the IA found that as there was no entitlement for the grievor to receive SE, he was required to repay the amount he had incorrectly received.

The Committee found that the grievor did not meet the conditions to be entitled to SE. However, it concluded that this was not a simple case of overpayment and it was not reasonable to recover the SE paid to the grievor based on the following:

• First, the grievor had a valid claim against the Crown for damages based on his detrimental reliance on the CFSU's negligent misrepresentation;

• Second, as there was no “unjust enrichment” of the grievor, it could be demonstrated that restitution would be unjust in the circumstances; and

• Third, because the erroneous advice provided by the CFSU induced the grievor and his spouse to change their original approach to taking SE, the doctrine of estoppel should be applied to prevent the recovery from the grievor.

The Committee recommended that the CDS decide in the grievor's favour by exercising one of the three following alternatives:

• seek Ministerial approval to cease the recovery;

• apply the doctrine of estoppel to prevent recovery; or

• refer the file to the Director of Civil Claims and Litigation with his support for assessment as a case of negligent misrepresentation.

The Committee also made three systemic recommendations concerning the regulations governing recovery of overpayments within the CAF.

FA Decision Summary

FA Decision Pending