Sander Holdings Ltd. v. Canada (Attorney General), 2004 FC 188

         Date: 20040205                                                                                                                       

    Docket: T-1172-03

                                                                                                                  Citation: 2004 FC 188

Ottawa, Ontario, this 5^th day of February, 2004

BETWEEN:

SANDER HOLDINGS LTD., DONALD PATENAUDE AND

MATHEW NAGYL

on their own behalf and on behalf of all persons who have been Producers,

shipping grain through the Canadian Wheat Board,

as defined under The Canadian Wheat Board Act,

and who do reside or have resided in Canada

between 1994 and the date of the decision.

                                                                                                                                                       Applicant

                                                                                 and

THE ATTORNEY GENERAL OF CANADA representing

The Minister of Agriculture of Canada

                                                                                                                                                   Respondent

REASONS FOR ORDER

von FINCKENSTEIN J.

[1]                 The Defendant in this case brought a motion for summary judgment striking out the statement of claim as disclosing no reasonable cause of action at law or, alternatively, summary judgment dismissing the statement of claim as disclosing no genuine issue for trial.

BACKGROUND

[2]                 This motion is based upon the Net Income Stabilization Account Program (NISA Program). The background for that program is as follows.

[3]                 The NISA Program was introduced in 1991 to assist producers in stabilizing their farming income. The Program was legislated through the Farm Income Protection Act, S.C. 1991, c. 22 (FIPA) which received Royal Assent in 1991. This enabling legislation provided a framework under which agreements were to be developed with the provinces in order to implement the NISA Program.

[4]                 The Federal/Provincial Agreement between Canada and the provinces which established the NISA Program (NISA Agreement) entered into force in 1991. In accordance with Section 6.2 of the NISA Agreement, Canada is responsible for the administration of the NISA Program.

[5]                 The NISA Agreement provides for the National NISA Committee (NISA Committee) to perform an advisory role to Canada. The NISA Committee is composed of federal, provincial and producer representatives. The composition and functions of the NISA Committee are set out in Article 2 of Schedule C of the NISA Agreement as follows:

National NISA Committee Structure

2.1            The Committee shall include a minimum of six and a maximum of ten producers appointed by the Minister to represent commodity groups and regions of Canada. Appointees must be individuals directly or indirectly participating (or agreeing to become a participant) in the Program

2.2.           Producers shall be appointed for a maximum of a three (3) year term. In the first year, some producers will be appointed to a one year term, some to a two (2) year term and the remainder to a three (3) year term.

2.3            Each participating Province may name one member to the Committee.

2.4            Canada may name four (4) members to the Committee.

2.5            Canada shall name the chairperson of the Committee from those individuals appointed above. The chairperson shall be responsible to refer matters of significant financial impact to the parties to this Agreement for approval.

2.6            Each member will have equal voting power.

[6]                 The NISA Agreement also has a special amendment clause which reads as follows:

Except as provided in Section 5 of Schedule B, this Agreement may be amended from time to time by the agreement of Canada and at least two-thirds of the participating Provinces where these Provinces represent at least fifty (50) percent of the eligible net sales reported to the Program in the previous year. A Province which does not wish to comply with an amendment respecting significant financial implications, may elect, by written notice to Canada, to withdraw from the Agreement as of the end of the next calendar year and the amendments will not apply to that Province for this period

[7]                 The program operates by allowing a producer to make both matchable and non-matchable deposits to the program. A producer can deposit up to three percent (3%) of his or her eligible net sales and receive matching contributions cost-shared between the federal and participating provincial governments. A producer can also make additional deposits of up to twenty percent (20%) of his or her eligible net sales, although these deposits are not matched by the governments. All deposits earn a three percent (3%) interest bonus. The NISA Agreement does not define the word "sales." Therefore, since the signing of the Agreement, the administration has had to interpret at what point and for what value it can be said that a producer sells its grain.

[8]                 The participation of any producer in the NISA Program is entirely voluntary. There were approximately 157,000 producer participants in the NISA Program for the 2002 stabilization year.

[9]                 The NISA Agreement defines "eligible net sales" as the net sales of commodities which are specified in Schedule B of the Agreement. The definition of "eligible expenses" plays no role in establishing the value of "net sales," "eligible net sales" or the value of government contributions under Section 4.2 of the NISA Agreement.

[10]            The NISA Agreement further establishes an Appeals Sub-Committee of the NISA Committee ("Appeals Sub-Committee") in accordance with Section 6 of Schedule C of the NISA Agreement. The Appeals Sub-Committee hears appeals of participants in the NISA Program from decisions of the administration and recommends action to the administration. Individual producers who believe that their eligible net sales or the matching government contributions were improperly calculated can, and regularly do, appeal to this Appeals Sub-Committee.

[11]            Each year, participants in the NISA Program are asked to complete a form which details income and expenses in various categories. The forms are to be completed in accordance with the instructions provided in application packages and producer handbooks which are forwarded to producers. These instructions include guidelines called the "Point of Sale Guidelines," which are designed to assist participants in determining their net sales for the purposes of the NISA Program.

[12]            Until 1994, the Point of Sale Guidelines read as follows:

The point of sale occurs when one of the following point is met:

- you no longer have full ownership of the commodity; or

- you no longer have full managerial control of the commodity to make decisions on                                                   transportation, cleaning, packaging, marking etc, or

- you are no longer fully responsible for the loss of the commodity; or

- your sales invoice does not clearly show the actual sale value of the commodity.

[13]            In October 1994, the NISA Committee recommended that the Point of Sale Guidelines be changed to read as follows:

Participants may report for NISA the gross revenues of qualifying commodities and the         applicable expenses recognized in the calculation of farming income for income tax purposes     providing:

- The commodities were produced on their farm;

- They can demonstrate ownership of the product through identity preservation and                                                 bear full direct ownership of the commodity; and

- they have separate billing or accounting transactions clearly showing the commodity

   sales value and any deductions from the commodity sales value.

[14]            Since this time, the NISA Program has been administered in accordance with these new guidelines. The Plaintiffs allege that this has meant that freight and elevation costs are no longer included in the calculation of eligible net sales. The Defendant denies this, claiming that such costs were never included as eligible net sales and that the guidelines merely represent a clarification of a previous policy.

[15]            The Plaintiffs' case boils down to following allegations:

a)         that the change to the Point of Sale Guidelines amounted to an invalid amendment of the NISA Agreement as it did not comply with amendment provisions of that agreement, or

b)         alternatively, that the guidelines are ultra vires the NISA Agreement, and,

c)         that, as a result of either a) or b), the Defendant is obliged to reimburse to the Plaintiffs the amounts improperly deducted from their NISA Accounts and their matching government counterpart contributions.

[16]            In addition, the Plaintiffs allege:

a)         that the Minister had a duty to take into account the effects of the 1995 repeal of the Western Grain Transportation Act and the replacement of the Point of Sale Guidelines with another set of guidelines, and

b)         that the Minister has a fiduciary duty to the grain producers which he has breached through the application of the new guidelines.

[17]            As a consequence, the Plaintiffs ask for damages or, in the alternative, for a declaration that the Point of Sale Guidelines are ultra vires.

[18]            The Defendant denies all of the above allegations and has brought this motion because, in its view, the statement of claim discloses no cause of action.

[19]            I will address sequentially the issues raised by this application under the following headings: amendment to guidelines, ultra vires, judicial review, no issue to be tried, no cause of action and ficuciary duty.

I - Amendment to Guidelines

[20]            The whole of the Plaintiffs' case rests upon the change made to the guidelines in 1994. The facts regarding the change are not in dispute.

[21]            Where the facts are not in dispute, a judge hearing a motion under Rule 216 of the Federal Court Rules, 1998, SOR/98-106 can make findings of fact. As Strayer J., as he then was, stated in Patrick v. Canada, [1994] F.C.J. No. 1216 at paragraph 6:

I am fully cognizant of the desirability of cases being disposed of on a summary basis where there is no real dispute over the law or the facts or where such disputes as there are can be resolved by the motions judge on the material before him. The new Federal Court Rule 432.3(4)(a) clearly authorizes a judge to decide questions of both fact and law on a motion for summary judgment if he is able to do so on the material before him. In this respect the power of the Court on such a motion is broader than that provided under Ontario Rule 20 which was the Rule in question in the decision of the Ontario Court of Justice in Ottawa Mortgage Investment Corporation v. Douglas C. Edwards, (1991) 7 C.P.C.(3d) 71 where the Court declined to grant summary judgment because there were certain questions of fact to be determined.

[22]            Given that the facts ( concerning how and when the changes to the guidelines were made) are clear and are not in dispute, the issue becomes whether the change to the guidelines was made in violation of the NISA Agreement as the Plaintiffs allege. While it is true that changes to the NISA Agreement are governed by Clause 6.9 which requires a two thirds majority and a 50% of eligible net sales requirement, it is equally apparent that this clause does not apply to the workings of the NISA Committee. Clause 2.6 of Schedule C of the NISA Agreement specifically states that "Each member shall have equal voting power."

[23]            Guidelines are not part of the NISA Agreement but rather exist to facilitate its administration. They are not norms, standards or legal rules. As MacKay J. stated so eloquently in Pereira v. Canada (M.C.I.), (1994) 86 F.T.R 43 at paragraph 11:

In my view, this argument implies the guidelines have the status of legal norm, which they do not. They are not more than guidance, for officers, with the intent of seeking a reasonable measure of consistency in the exercise of discretion. That does not establish the guidelines as equivalent to law; it does not require that the officers consider particular qualities or tests or measures, for that would fetter discretion, in a manner disapproved of in Yhap.

[24]          With respect to the particular guidelines at issue in this case, the change made by the NISA Committee and the alleged improper amendment were considered by Rouleau J. in Boyko v. Canada (Minister of Agriculture), [2000] F.C J. No. 399, aff'd. [2001] F.C.J. No. 316 (F.C.A.), at paragraphs 13-15:

It has long been recognized that administrative bodies frequently develop a coherent set of guidelines to assist in the exercise of their discretionary statutory powers such as those set out above in the Farm Income Protection Act. Policies allow a public body to develop guidelines which bridge the gap between a general discretionary statutory power and its specific application to a particular case. There is judicial recognition that the consistent exercise of discretionary administrative power inevitably leads to the formulation of some general policy relating to the exercise of that power. The content of the policy must be within the scope of the power bestowed by the enabling legislation and it cannot be formulated or applied in bad faith or with regard to irrelevant considerations or purposes extraneous to the intent of the legislation. It is well established by the jurisprudence that provided these criteria have been met, the Courts will exercise caution and restraint in reviewing administrative actions of this nature. These principles of law were stated by the Supreme Court of Canada in Maple Lodge Farms v. Government of Canada (1982), 137 D.L.R. (3d) 558 in the following terms at p. 562:

In construing statutes which provide for far reaching and complicated administrative schemes, the judicial approach should be to endeavour within the scope of the legislation to give effect to its provisions so that the administrative agencies created function effectively, as the legislation intended and the courts should wherever possible, avoid a narrow, technical construction and endeavour to make effective the legislative intent as applied to the administrative scheme involved. It is, as well, a clearly established rule that the court should not interfere with the exercise of a discretion by statutory authority only because the court might have exercised the discretion in a different manner had it been charged with that responsibility. Where the statutory discretion has been exercised in good faith and, where reliance has not been placed upon considerations irrelevant or extraneous to the statutory purpose, the courts should not interfere.

The Federal Court of Appeal adopted this reasoning in Carpenter Fishing Pool v. Canada (1998) 155 D.L.R. (4th) 572 wherein Decary, J.A. stated at p. 581 as follows:

To the extent that the policy is developed by the minister in the exercise of his general duties ... and that it is not blindly applied by him in the later exercise of his discretion in granting a specific licence, the act in granting the licence, however administrative in nature and otherwise is subject to ordinary judicial review as it may be, cannot be challenged under the general rules applicable to administrative actions in so far as its policy component ... is concerned. When examining an attack on an administrative action ... reviewing courts should be careful not to apply to the legislative component the standard of review applicable to administrative functions. The line may be a fine one to draw but whenever an indirect attack on a quota policy is made through a direct attack on the granting of a licence, courts should isolate the former and apply to it the standards applicable to the review of legislative action as defined in Maple Lodge Farms.

In the present case, the Guidelines in question are clearly a studied policy formulated by the parties to the NISA Agreement after public consultation and years of deliberation by NISA officials and committee members. They are of general application to all of the voluntary participants in the NISA program. There is no evidence here of bad faith or reliance having been placed upon irrelevant or extraneous considerations in the development of the Guidelines. Although the present application is couched in terms as a direct attack on the recommendation of the Appeal Sub-Committee to apply the policy, the real essence of the applicants' complaint is with the policy itself; in other words, they take exception to the fact that the term "eligible net sales" does not include grain transportation costs to port and argue that the Guidelines in some way constitute an unlawful amendment of the NISA Agreement. However, all of the evidence before this Court clearly establishes that the meaning of "eligible net sales" has never, since the inception of the program to the present, included grain transportation cost to port nor has the NISA Agreement ever been formally amended to reflect any change of that nature.

[25]            Like Rouleau J., I find that there was nothing improper in the manner in which the change was made to the Point of Sale Guidelines and that the change in itself did not amount to an amendment of the NISA Agreement.

II - Ultra Vires

[26]            Having found that guidelines are not a legal norm within the meaning of Perriera, supra, it follows as a logical corollary that the guidelines can also not be ultra vires the FIPA, its Regulations or contrary to the NISA Agreement.

III - Judicial Review

[27]            The Plaintiffs, in the prayer for relief of their Statement of Claim, seek, in the alternative, judicial review and a declaratory judgement to the effect that the changes to the guidelines were contrary to the Agreement or were ultra vires. Given that the NISA Agreement is authorized by the FIPA, there can be little doubt that a question as to whether or not the NISA Agreement was incorrectly amended is a question for judicial review by this court. See: Ontario Chicken Producers' Marketing Board v. The Canadian Chicken Marketing Agency, [1993] 1 F.C. 116.

[28]            Although this case was started as an action by way of statement of claim, this does not prevent the plaintiffs from succeeding in their request for declaratory relief. In Sweet v. Canada, [1999] F.C.J. No. 1539 (F.C.A.), the applicant sought declaratory relief yet had commenced an action by way of statement of claim. Décary J.A. made the following comments at paras. 14-18:

I am not at all convinced that a motion to strike on the ground that pleadings show no reasonable cause of action is the proper vehicle in cases where the issue is whether a party should have proceeded by way of judicial review or by way of action. It seems to me that whether the procedure used is or is not the proper one does not relate to whether the procedure, if proper, discloses a reasonable cause of action. The intent of the Rules is precisely to avoid striking out pleadings that should have originated in another form. Once it is ascertained that a given proceeding falls into one or the other of the two categories (judicial review and action), the duty of the Court is to determine which is the applicable category and to allow the proceeding to continue in that way. Means must be found by counsel and by the Court to address the issue intelligently and with a sense of practicality.

The new Federal Court Rules, 1998 give the Court, and counsel, ample guidance to avoid resorting to drastic means such as motions to strike whenever possible. Rule 57 is particularly instructive. It ensures that " an originating document shall not be set aside only on the ground that a different originating document should have been used". While new in form, I venture to say that this rule codifies the practice already followed by the Court......

It therefore serves no useful purpose to move to strike pleadings when, at the end of the day, the Court will allow the applicant or plaintiff to file a new, and correct, proceeding. A motion to attack the irregularity, under rule 58, could well prove to be a useful, yet less drastic, means to bring about the change required. I appreciate that rule 58 addresses irregularities resulting from non-compliance with the Rules and that the categories of proceedings are dictated by the Act. Yet, in my view, it is the Rules which determine how a proceeding is commenced (rule 61), and where a proceeding is commenced otherwise than in the form prescribed, the question then becomes one of non-compliance with the Rules, not one of non-compliance with the Act.

It seems to me that in a case where many different sorts of relief are claimed, some of which require an action and some of which require judicial review, the proper course is to determine which relief it makes more sense to decide first, then to determine whether the procedure taken is the proper one with respect to that relief and, if not, to allow the party to correct it with appropriate amendments.

In this case, I would have been prepared, had it not been for the decision I ultimately have made based on other grounds, to treat that part of the Respondent's motion to strike which rests on the "judicial review or action" argument as a motion to attack an irregularity under rule 58.     

The same reasoning is applicable to the case at hand. As a result, the Defendant's motion could be considered as a motion for noncompliance with the Rules pursuant to Rule 58.

[29]            All of this, however, is hypothetical. Given my earlier finding and the findings in Boyko, supra., that the guidelines are not part of the agreement and do not amend it, and are not ultra vires the FIPA or its Regulations, there is no issue which might form the basis for an application for judicial review.

IV - No Issue to be tried

[30]            The law regarding whether or not there is a genuine issue for trial was set out by LaForest J., in [1977] 2 S.C.R. 165">Hercules Management v. Ernst & Young, [1977] 2 S.C.R. 165 at 182 where he stated:

The first concerns the procedure to be followed in a motion for summary judgment brought under Rule 20.03(1) of the Manitoba Court of Queen's Bench Rules. That rule provides as follows:

20.03(1) Where the court is satisfied that there is no genuine issue for trial with respect to a claim or defence, the court shall grant summary judgment accordingly.

I would agree with both the Court of Appeal and the motions judge in their endorsement of the procedure set out in Fidkalo, supra, at p. 267, namely:

The question to be decided on a rule 20 motion is whether there is a genuine issue for trial. Although a defendant who seeks dismissal of an action has an initial burden of showing that the case is one in which the existence of a genuine issue is a proper question for consideration, it is the plaintiff who must then, according to the rule, establish his claim as being one with a real chance of success.

[31]            Given my finding regarding the interpretation of the NISA Agreement and the change made to the guidelines in 1994, I do not believe that the Plaintiff has discharged his burden. Therefore, there is no genuine issue for trial

V - No Cause of Action                       

Negligence/Duty of care

[32]          A cause of action has been defined as "simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person" (Letang v. Cooper, [1965] 1 Q.B. 232 at 235 per Diplock J.).

[33]            Another succinct statement regarding a cause of action may be found in Operation Dismantle. et al. v. The Queen et al. (1985),18 D.L.R. (4th) 481 at 515 where Wilson J. stated:

The law then would appear to be clear. The facts pleaded are to be taken as proved. When so taken, the question is: do they disclose a reasonable cause of action, i.e., a cause of action "with some chance of success" (Drummond-Jackson v. British Medical Ass'n, [1970] 1 All E.R. 1094) or, as Le Dain J. put it in Dowson v. The Queen (1981), 124 D.L.R. (3d) 260 at p. 268, 37 N.R. 127 (sub nom. Dowson v. Government of Canada) (F.C.A.) at p. 138, is it "plain and obvious that the action cannot succeed" ? Is it plain and obvious that the plaintiffs' claim for declaratory or consequential relief cannot succeed?

[34]            It can be assumed in this case that the facts, as alleged, can be proven, i.e. that, since the change in the guidelines, the NISA administration has not included freight and elevation costs in the calculation of eligible net sales, whereas before they did so. What cause of action, therefore, do the plaintiff have and what cause of action is revealed in their pleadings?

[35]            In this case, the pleadings do not reveal a cause of action. They merely state the request for damages or, in the alternative, for a declaratory judgement. During the oral hearing, despite repeated questioning by the court, counsel for the plaintiffs did not identify his cause of action. He merely reiterated that the change in guidelines resulted in a breach of the NISA Agreement.

[36]            While the Plaintiffs do not allege negligence, they assert that the alleged breach of the amendment provisions of the NISA Agreement entitles them to damages. To have any chance of success at trial, the Plaintiffs would, first of all, need to convince a court of the incorrectness of the findings of Rouleau, J. in Boyko, supra. and myself in paragraph 25 above. Secondly, they would need to bring themselves within the ambit of the so-called Anns/Kamloops test based upon the cases of Anns v. Merton London Borough Council, [1978] A.C. 728 and [1984] 2 S.C.R. 2">City of Kamloops v. Neilson, [1984] 2 S.C.R. 2.

[37]            The test was succinctly summarized by Hugessen J. in A. O. Farms Inc v. Canada, [2000] F.C.J. No. 1771 where he stated at paragraphs 10-12:

What I have said is enough to dispose of the present motion. However, since both counsel have spoken of it, it is incumbent on me, I think, to say a few words about the more modern approach to claims in negligence against public authorities known in legal shorthand as the Anns/Kamloops test. As I understand it, that test has two branches. First, the Court asks whether there is a relationship of proximity between the plaintiff and the authority such as to give rise to a duty of care. Next, one asks whether there are statute or policy considerations which mitigate, colour or negate such duty.

Here it seems to me that on both branches of the test the action must fail. The relationship between the government and the governed is not one of individual proximity. Any, perhaps most, government actions are likely to cause harm to some members of the public. That is why government is not an easy matter. Of course, the government owes a duty to the public but it is a duty owed to the public collectively and not individually. The remedy for those who think that duty has not been fulfilled is at the polls and not before the Courts.

Very similar considerations, it seems to me, apply to the second branch of the test. A public authority must be free to make its choices with an eye only to their political consequences, not to the possibility of being sued for damages. That is the primary policy consideration underlying the Welbridge and Guimond decisions with which I started these Reasons and they are equally applicable here. Government, when it legislates, even wrongly, incompetently, stupidly, or misguidedly is not liable in damages. That, in essence, is what the plaintiff has alleged and it discloses, in my view, no cause of action for trial.

[38]            The observations of Hugessen J. equally apply to this case. There is nothing in the pleadings, which, even if completely proven, would allow this action to succeed on the second branch of the Anns/Kamloops test.

Breach of Statutory Duty

[39]            The plaintiffs also allege that, by virtue of Section 4(2) of the FIPA, the Minister of Agriculture had a duty to renegotiate the NISA Agreement following the repeal of the Western Grain Transportation Act due to the repeal's negative impact on producers.

[40]            Section 4 of the FIPA provides as follows:

4. (1) The Governor in Council may, by order, authorize the Minister to enter into an agreement with one or more provinces to provide for the establishment of any of the following programs:             

(a) a net income stabilization account program;

(b) a gross revenue insurance program;

(c) a revenue insurance program; and

(d) a crop insurance program.       

(2) In negotiating an agreement authorized under subsection (1), the Minister shall take into        consideration the following principles in respect of any program to be established under the agreement:

(a) the program should not unduly influence the decisions of producers of agricultural products with respect to production or marketing, and should encourage adjustments with respect to production or marketing so as to improve the effectiveness of the responses of producers to market opportunities;

(b) the level of protection to be provided by, and the relative share of governmental contributions to be provided to, the program in relation to particular agricultural products or classes of agricultural products should be equitable and reasonably consistent with all other agreements, taking into account regional diversity;

(c) the program should encourage the long-term social and economic sustainability of farm families and communities;

(d) the program should be compatible with Canada's international obligations; and

(e) the program should encourage long-term environmental and economic sustainability.

[41]            While I see nothing in Section 4 of the FIPA that establishes the duty to renegotiate, I will consider, for the purposes of this motion, that the plaintiffs can successfully establish such a fact. However, this will not advance their cause.

[42]            Making the assumption above, the failure to negotiate might amount to a breach of a statutory duty, however, it does not amount to a cause of action. Dickson C.J. summarized the Canadian position on breach of statutory duty in The Queen v. Saskatchewan Wheat Pool, [1983] 1S.C.R. 205 at 227 where he succinctly stated:

In sum I conclude that:

1. Civil consequences of breach of statute should be subsumed in the law of negligence.

2. The notion of a nominate tort of statutory breach giving a right to recovery merely on proof of breach and damages should be rejected, as should the view that unexcused breach constitutes negligence per se giving rise to absolute liability.

3. Proof of statutory breach, causative of damages, may be evidence of negligence.

4. The statutory formulation of the duty may afford a specific, and useful, standard of reasonable conduct.

In light of the foregoing discussion, the plaintiffs cannot succeed on the basis of this allegation either as they have not pleaded the manner in which any breach of a statutory duty constituted negligence in this case.

VI - Fiduciary Duty

[43]            Alternatively, the Plaintiffs allege that the Minister of Agriculture owed them a fiduciary duty and that he breached this duty by allowing the 1994 changes to the guidelines.

[44]            In [1984] 2 S.C.R. 335">Guerin v. The Queen, [1984] 2 S.C.R. 335 at 384, Dickson J. used the following definition of fiduciary duty:

Professor Ernest Weinrib maintains in his article The Fiduciary Obligation (1975), 25 U.T.L.J. 1, at p. 7, that "the hallmark of a fiduciary relation is that the relative legal positions are such that one party is at the mercy of the other's discretion." Earlier, at p. 4, he puts the point in the following way:

Where there is a fiduciary obligation] there is a relation in which the principal's interests can be affected by, and are therefore dependent on, the manner in which the fiduciary uses the discretion which has been delegated to him. The fiduciary obligation is the law's blunt tool for the control of this discretion.        

I make no comment upon whether this description is broad enough to embrace all fiduciary obligations. I do agree, however, that where by statute, agreement, or perhaps by unilateral undertaking, one party has an obligation to act for the benefit of another, and that obligation carries with it a discretionary power, the party thus empowered becomes a fiduciary. Equity will then supervise the relationship by holding him to the fiduciary's strict standard of conduct.

He also made the following observations in respect of fiduciary duties of public bodies at p. 385:

It should be noted that fiduciary duties generally arise only with regard to obligations originating in a private law context. Public law duties, the performance of which requires the exercise of discretion, do not typically give rise to a fiduciary relationship. As the "political trust" cases indicate, the Crown is not normally viewed as a fiduciary in the exercise of its legislative or administrative function.

[45]            Here, we have a voluntary program. The program has its own internal correction mechanism by way of the Appeals Sub-Committee. Consequently, there is no way that one can say that the farmers are at the mercy of the Minister's discretion. As a result, the concept of fiduciary duty does not apply in this case.

CONCLUSION

[46]            In light of the above findings, this application is allowed and there will be a summary judgement in favour of the Defendant striking out the statement of claim as showing no cause of action at law and no genuine issue for trial or judicial review.    Costs are awarded to the Defendant.

_______________________

    JUDGE

FEDERAL COURT

                  NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                                T-1172-03

STYLE OF CAUSE: SANDER HOLDINGS LTD et al

                                     v.

THE ATTORNEY GENERAL OF CANADA

PLACE OF HEARING:         Regina, Saskatchewan

DATE OF HEARING:           January 16, 2004

REASONS FOR ORDER : The Honourable Mr. Justice von Finckenstein

DATED:                                   February 5, 2004

APPEARANCES:

Mr. E. F. Anthony Merchant, Q.C.                                                           FOR PLAINTIFF

Mr. Brian H. Hay                                                                                        FOR DEFENDANT

SOLICITORS OF RECORD:

Mr. E. F. Anthony Merchant, Q.C.        FOR PLAINTIFF

Merchant Law Group

4 Third Avenue N.

Yorkton, Saskatchewan

S3N 1B9

Mr. Morris Rosenberg              FOR DEFENDANT

Deputy Attorney General of Canada

Department of Justice

301 - 310 Broadway

Winnipeg, Manitoba

R3C 0S6