Academic journal article Review of Constitutional Studies

All I Really Needed to Know about Federalism, I Learned from Insurance Law

Academic journal article Review of Constitutional Studies

All I Really Needed to Know about Federalism, I Learned from Insurance Law

Article excerpt

I. Introduction

In 1988, Robert Fulghum published his bestselling book, All I Really Needed to Know... I Learned in Kindergarten. In this book, Fulghum contends that the cardinal rules for success in life can be gleaned from the fundamental lessons taught in a single, elementary institution: namely, kindergarten. Adopting, and adapting, Fulghum's approach (and his catchy title), the main objective of this paper is to demonstrate how the basic principles of Canadian constitutional law regarding federalism--that is, the fundamental legal doctrines pertaining to the division of legislative powers between the federal and provincial governments--can be gleaned solely from court decisions concerning the provision and regulation of insurance.

Readers may appropriately wonder about the relevance of this objective. One hundred and fifty years after Confederation, the central elements of Canadian law regarding division of powers analysis are well-established. One might therefore ask why it is important to look at these basic principles through the lens of insurance law. My answer to this question is threefold. First, the significant role that insurance law cases have played in developing fundamental constitutional law doctrine merits recognition. Insurance law cases depict the evolution of judicial thinking about the division of powers from Confederation to the present day. Moreover, insurance remains an important subject for federalism analysis today. For example, questions have been raised about the constitutionality of the recently passed federal Genetic Non-Discrimination Act, which, among other things, prohibits a party from withdrawing from or refusing to enter into a contract with an individual who refuses to undergo genetic testing or who refuses to release the results of genetic testing. (1) Although not aimed specifically at insurance companies, this prohibition applies to insurance companies. In particular, this legislation has the effect of preventing life and disability insurers from requiring their clients to undergo or to disclose genetic testing as a condition of providing insurance coverage. The federal government has therefore raised the possibility of referring this legislation to the Supreme Court of Canada to determine whether the impact of this federal legislation on the provincial authority over insurance is constitutional. (2)

Second, because federalism concerns the legislative competence of provincial and federal governments, it is easy to lapse into thinking that Canadian constitutional law concerns only public law matters. Insurance law cases remind us otherwise. In legal terms, an insurance arrangement is a contract, and therefore is a matter of private law. Nevertheless, insurance is heavily regulated, and sometimes mandated, by governments. Therefore, court decisions about which order of government can provide for, regulate, or otherwise impact insurance contracts prompt us to acknowledge that the line between public law matters and private law matters is not always clear in Canadian constitutional law. (3) Finally, insurance is not expressly itemized as a subject of legislative authority under the Constitution Act, 1867. (4) Nevertheless, it was "one of the first industries to attract fundamental regulation." (5) Accordingly, constitutional law cases concerning legislative competence over insurance matters demonstrate how Canadian courts have developed constitutional law principles in the absence of express constitutional text.

Another question that may be raised in respect of my thesis is what is meant by the "basic principles" of federalism. Over the past 150 years, the courts have produced a plethora of case law regarding federalism analysis, and the principles derived from these cases can be described, categorized, and counted in a number of ways. For the purposes of the present discussion, I have reduced these principles to five key propositions, which I believe collectively provide a reasonably comprehensive overview of how disputes over legislative jurisdiction are resolved under Canadian law. …

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