Law360 Canada ( November 27, 2024, 1:57 PM EST) -- Appeal by Attorney General of Quebec from a judgment of the Quebec Court of Appeal which set aside a Superior Court judgment and ordered Government of Quebec (Quebec) to reimburse Respondent accumulated deficits. The Respondent was a band council representing the Pekuakamiulnuatsh Innu First Nation in Mashteuiatsh. The Respondent, Quebec and the Government of Canada (Canada) entered into successive tripartite agreements regarding police services in the Mashteuiatsh community. Under the agreements, the Respondent was responsible for the administrative management of its police force, the Sécurité publique de Mashteuiatsh (SPM). Canada and Quebec were to fund the SPM by making financial contributions. Between 2013 and 2017, the government funding provided for in the agreements proved to be inadequate on its own to ensure the maintenance of the SPM and it incurred an operating deficit. The Respondent brought legal proceedings against Canada and Quebec for the reimbursement of the accumulated deficits. It argued that Quebec and Canada breached their obligations to negotiate in good faith and to act with honour by renewing the agreements when they knew that the budgets and funding provided for in the tripartite agreements were not representative of the actual costs of maintaining the SPM. The trial judge dismissed the application. The Court of Appeal concluded that by refusing to adequately fund the SPM, Quebec and Canada violated the principle of good faith and failed to uphold the honour of the Crown. Quebec and Canada were ordered to pay their share of the total amount of the accumulated deficits. Only Quebec appealed arguing that the honour of the Crown did not apply to the agreements and that a breach of the contractual terms or of the requirements of good faith had not been proven....