Richard Klassen sued a Saskatchewan Crown prosecutor for malicious prosecution. The Supreme Court of Canada will rule on the case Friday. (CBC)

A Saskatchewan lawsuit over a malicious prosecution that has caught the attention of government lawyers across the country will be decided Friday morning by the Supreme Court of Canada.

In 2003, Matthew Miazga, a senior Crown prosecutor in Saskatchewan's Ministry of Justice, was found to have maliciously prosecuted several people accused of bizarre acts of sexual assault against foster children in the early 1990s.

The original criminal case was a media sensation in Saskatchewan as allegations emerged about satanic rituals and dead babies in secret rural locations.

There was no supporting evidence for any of those stories and the children later admitted they had lied to investigators. It also came out later that the children making the accusations had a history of making up incredible stories.

Nevertheless, in 1991, police and prosecutors decided to arrest 16 people and press more than 70 charges of sexual assault.

As the criminal cases worked through the court system, many charges were stayed or dismissed after a preliminary hearing. Ultimately, only a few convictions were secured.

Many of the accused, however, were devastated by the allegations.

In 1994, Richard Klassen and others filed a lawsuit claiming malicious prosecution, naming police officials, a child therapist and the Crown.

Klassen, a house painter with a Grade 7 education, waged a David versus Goliath struggle as he almost single-handedly led the case against government and police authorities in the courts.

The lawsuit took 10 years to conclude and, in 2003, a Saskatoon judge found authorities acted improperly.

The decision was challenged and Saskatchewan's Court of Appeal decided, in 2007, that the judgment against the child therapist should be set aside. The court, however, upheld the judgment against Crown lawyer Miazga.

The police did not participate in that appeal and later reached a settlement with Klassen, details of which were not disclosed.

Case appealed in Saskatchewan

The Saskatchewan Court of Appeal examined the degree to which Crown prosecutors are immune from prosecution. The court said challenging public authorities, while difficult, should not be impossible.

"It should have been apparent to anyone that the children's evidence, because of the bizarre and incredible nature of some of their allegations and their propensity to lie, was not sufficiently credible without some independent corroboration to support the many charges," the Court of Appeal said in its decision.

"For a Crown prosecutor to proceed with a prosecution without a belief in the credibility of his complainants, and without a belief in the guilt of the accused amounts to the 'wilful and intentional effort on the Crown's part to abuse or distort its proper role within the criminal justice system,'" the court added, quoting from another court decision on the same topic.

The Court of Appeal said it was satisfied that Miazga's actions went "beyond bad judgment, negligence or recklessness and into the realm of malice."

That decision was challenged by Miazga, and his appeal was heard by the Supreme Court of Canada in December 2008.

It attracted considerable interest among government lawyers and the Supreme Court accepted input on the case from officials from seven provinces, and the federal government. Two professional organizations representing Crown lawyers also weighed in.

The court also heard from the Association in Defence of the Wrongfully Convicted.

The Supreme Court decision is expected to be released at 9:45 ET in Ottawa.

Settlement money mostly paid out

The Saskatchewan government negotiated a settlement with Klassen, and the other members of the lawsuit, in 2004.

The province agreed to pay compensation of $2.8 million "in recognition of Justice [George W.] Baynton's declaration the plaintiffs are innocent, and recognizing the pain and suffering and expense resulting from the prosecution and the civil action," according to a release at the time.

The government paid all but $100,000 of the settlement by February 2008. It said the final hold-back would depend upon the outcome of the Supreme Court of Canada's decision.