Docket: A-169-14
Citation:
2015 FCA 89
CORAM:
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NADON J.A.
PELLETIER J.A.
STRATAS J.A.
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BETWEEN:
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PARADIS HONEY
LTD., HONEYBEE ENTERPRISES LTD. AND ROCKLAKE APIARIES LTD.
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Appellants
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and
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HER MAJESTY THE
QUEEN, THE MINISTER OF AGRICULTURE AND AGRI-FOOD AND THE CANADIAN FOOD
INSPECTION AGENCY
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Respondents
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REASONS
FOR JUDGMENT
PELLETIER J.A. (Dissenting Reasons)
I.
INTRODUCTION
[1]
This appeal arises from a proposed class action
by a group of commercial beekeepers (the Beekeepers), who rely on the
importation of honeybees to replace colonies lost due to winter-kill and other
factors. The subject matter of the litigation is the ban on importation of
honey bees from the United States which has been in force in one form or another
since the 1980s. The Beekeepers’ complaint is that since 2007, the respondents
have adopted a policy of blanket prohibition on the importation of bee
“packages”, a term which will be explained below. While many of the Beekeepers
allegations would, if proved, give them an administrative law remedy, they have
sued in negligence, alleging that the respondents owe them a duty of care, have
breached the associated standard of care and have caused them damage.
[2]
Counsel for the respondents, Her Majesty the Queen,
the Minister of Agriculture and Agri-food (the Minister) and the Canadian Food
Inspection Agency (the Agency) (collectively the respondents) moved to have the
Beekeepers’ action struck out as disclosing no reasonable cause of action. That
motion was granted and the action was dismissed with costs, with reasons
reported as Paradis Honey Ltd. v. Canada (Attorney General), 2014 FC 215
(Reasons).
[3]
For the reasons that follow, I would allow the
appeal in part, and set aside the Federal Court Judge’s order as to costs. I
would confirm the dismissal of the Beekeepers’ statement of claim.
II.
THE FACTUAL MATRIX
[4]
Canada’s winter climate
being what it is, beekeepers have always suffered losses of colonies over the
winter, losses which have to be made up by the importation of new bees.
According to the Beekeepers, this can take one of two forms: either as a
“package”, a cereal-box-sized container holding a small colony (including a
queen) or as a “queen”, a match-box-sized container holding a queen bee and a
few attendant bees. Not surprisingly, it appears that, it is more efficient to
replace an existing colony with another (i.e. a package). Replacing a
colony with a queen requires more inputs and carries more risk on the way to
establishing a productive colony.
[5]
The Health of Animals Act, S.C. 1990, c.
21 (the Act) and its predecessor legislation have, at all material
times, governed the importation of animals, including bees, into Canada. Section 14 of the Act provides as follows:
14. The Minister
may make regulations prohibiting the importation of any animal or other thing
into Canada, any part of Canada or any Canadian port, either generally or
from any place named in the regulations, for such period as the Minister
considers necessary for the purpose of preventing a disease or toxic
substance from being introduced into or spread within Canada.
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14. Le ministre
peut, par règlement, interdire l’importation d’animaux ou de choses soit sur
tout ou partie du territoire canadien, soit à certains points d’entrée
seulement; l’interdiction, qui peut être générale ou viser uniquement des
provenances précises, est en vigueur le temps qu’il juge nécessaire pour
prévenir l’introduction ou la propagation au Canada d’une maladie ou d’une
substance toxique.
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[6]
In the absence of specific regulations,
importation of animals is managed by way of ministerial permits issued under
section 160 of the Health of Animals Regulations, C.R.C. 296 (the Regulations):
160. (1) Any application for a permit or licence required under
these Regulations shall be in a form approved by the Minister.
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160. (1) La
demande d’un permis ou d’une licence qu’exige le présent règlement est
présentée selon une formule approuvée par le ministre.
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(1.1) The
Minister may, subject to paragraph 37(1)(b) of the Canadian Environmental
Assessment Act, issue a permit or licence required under these Regulations
where the Minister is satisfied that, to the best of the Minister’s knowledge
and belief, the activity for which the permit or licence is issued would not,
or would not be likely to, result in the introduction into Canada, or spread
within Canada, of a vector, disease or toxic substance.
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(1.1) Le
ministre peut, sous réserve de l’alinéa 37(1)b) de la Loi canadienne sur
l’évaluation environnementale, délivrer tout permis ou licence exigé par le
présent règlement s’il est d’avis que l’activité visée par le permis ou la
licence n’entraînera pas ou qu’il est peu probable qu’elle entraîne, autant
qu’il sache, l’introduction ou la propagation au Canada de vecteurs, de
maladies ou de substances toxiques.
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[7]
Between the late 1980s and December 31, 2006,
the Minister made a series of regulations prohibiting the importation of
honeybees into Canada from the continental United States for various periods of
time. The prohibitions were designed to prevent the spread into Canada of the tracheal mite bee pest which, according to the Regulatory Impact Analysis Statements
(RIASs) issued concurrently with the regulations, threatened disastrous effects
on Canada’s beekeeping industry.
[8]
The last such regulation was the Honeybee
Importation Prohibition Regulations, 2004, SOR/2004-136 (HIPR
2004). Subsection 1(1) of the HIPR 2004 continued the prohibition on
the importation of honeybees into Canada from the continental United States, as
of the coming into force of the regulation until December 31, 2006. Subsection
1(2) provided that the prohibition in subsection 1(1) did not apply to the
importation of a honeybee queen with its attendant bees from the United States pursuant to a permit issued under section 160 of the Regulations. The
result was that the prohibition on importation of “packages” was continued
until the end of 2006, while the importation of “queens” was allowed pursuant
to permits issued under the authority of section 160 of the Regulations.
[9]
The kernel of the litigation underlying this
appeal is the fact that once the HIPR 2004 expired at the end of 2006,
it was not replaced. The importation of “queens” continued to be allowed
pursuant to permits issued under section 160 of the Regulations but, instead
of promulgating a new regulation dealing with the importation of “packages”,
the Minister simply adopted a policy that no permits would be issued for the
importation of “packages”. The Statement of Claim alleges that this policy was
communicated to the industry and, in the words of the statement of claim, “constitutes a de facto ministerial order or directive for
which there is no lawful authority”: see Appeal Book (A.B.) at page 63.
[10]
The Beekeepers plead that the purpose of the
original restrictions on importation was to protect and promote the economic
interests of the Canadian bee industry and Canadian beekeepers by insulating
them from the risk of disease associated with the importation of bees from the United States. They say that the respondents owed them a duty of care with respect to the
importation of bees from the United States, a duty which arose from the
statutory scheme itself and from various interactions between the respondents
and representatives of the beekeeping industry, as particularized at paragraph
26 of both the statement of claim and the proposed amended statement of claim.
In summary, this duty of care arose from:
−
The statutory scheme itself,
−
The respondents’ representations to the
beekeeping industry that they were acting in the industry’s interest,
−
The respondents’ knowledge of the hardship to
certain beekeepers and beekeeping region resulting from the prohibition on
importation of bees from the United States,
−
The respondents’ consultation and cooperation
with the beekeeping industry on bee import policy.
[11]
The statement of claim particularizes the
content of the respondents’ duty of care (i.e. the standard of care) and
sets out the ways in which standard of care was breached. The members of the
proposed class allege that they have suffered loss and damage as a result of
the respondents’ negligence and seek damages in the amount of $200,000,000. See
the A.B. at pp. 59-67.
[12]
A Federal Court Judge (sometimes referred to
simply as the Judge) was appointed to manage the Beekeepers proposed class
action. The Beekeepers’ motion for certification was served and filed on or
about September 12, 2013. In November 2013, the respondents served and filed
their motion to strike out the Beekeepers’ action. The Notice of Motion alleged
that the Beekeepers were not in such a close and direct relationship of
proximity with the respondents so as to give rise to a private duty of care.
[13]
In response, the Beekeepers filed a motion
record including a memorandum of fact and law to which they attached a proposed
amended statement of claim, in order to illustrate that any lack of
particularity alleged by the respondents could be remedied by amendment. When
the respondents took the position that it was too late for the Beekeepers to
amend their claim, the latter wrote to the case management judge to make clear
that they were not seeking to amend their claim, indicating that “the Proposed Amended Statement of Claim was provided for
illustrative purposes and that there is no motion before the Court at this time
to amend the Statement of Claim.”: A.B. at p. 210.
III.
THE DECISION UNDER APPEAL
[14]
After setting out in considerable detail the
parties’ arguments, the Judge set out the test on a motion to strike out a
statement of claim for failing to disclose a cause of action. He noted that the
Court should take the facts pleaded as true, unless they are manifestly
incapable of being proven, and should strike out a statement of claim only if
it is plain and obvious that those facts disclose no cause of action.
[15]
The Judge then turned to the proposed amended
statement of claim. Relying on Rule 75 of the Federal Courts Rules,
SOR/98-106, the Judge held that the Beekeepers could not amend their statement
of claim without leave. Furthermore, since the matter was case-managed, it was
incumbent on the Beekeepers to advise the Court of their intention to amend
their pleadings.
[16]
The Judge found that the facts pleaded in the
amended statement of claim were well known to the Beekeepers prior to the case
management conference at which the date for the hearing of the respondents’
motion to strike was fixed. Having reviewed the amendments, the Judge was not
satisfied that they cured the deficiency with respect to the issue of
proximity between the Beekeepers and the respondents. Relying on Apotex Inc.
v. Bristol-Myers Squibb Company, 2011 FCA 34, the Judge held that the
Beekeepers should have been more forthright about their intention to amend
their claim. In the result, the Judge struck the amended paragraphs of the
Beekeepers statement of claim as well as any other paragraph which referred to
the proposed amendments.
[17]
The Judge then considered whether it was plain and
obvious that the Beekeepers’ claim of negligence based on lack of lawful
authority would fail. The Judge found that the Act and the Regulations
provided the Minister with express authority to make decisions about the
importation of regulated animals, including honeybees, into Canada. He found that the facts pleaded by the Beekeepers could not establish liability since it is
settled law that a breach of statutory duty is not, in and of itself,
negligence: Holland v. Saskatchewan, 2008 SCC 42, [2008] 2 S.C.R. 551 at
paragraph 9.
[18]
The Judge then turned to the test for the
existence of a duty of care as set out in Anns v. Merton London Borough
Council, [1978] A.C. 728 (H.L.) (Anns). He noted the
parties’ agreement that the starting point in the analysis is to determine
whether a duty of care has been recognized in similar cases. After reviewing
the case law put before him by the parties, the Judge concluded that there was
no case which established a private law duty of care in similar circumstances.
[19]
The Judge then proceeded to apply the first leg
of the Anns test, namely, whether the facts pleaded “revealed the existence of a relationship that is
sufficiently close to create a duty on the [respondents] to take reasonable
measures to protect the [Beekeepers] from foreseeable economic losses”:
Reasons at paragraph 95.
[20]
The question was
therefore whether there was sufficient proximity between the Beekeepers and the
respondents to give rise to a duty of care. The Judge noted that the Beekeepers
based their allegation of a duty of care on the statutory scheme itself, as
well as on the nature of the interaction between the respondents and the
beekeeping industry.
[21]
After reviewing
specific provisions of the Act and the Regulations, the Judge
agreed with the respondents’ position that the legislative scheme is “aimed primarily at entrusting the [Agency] with broad
regulatory authority to protect animal health for the public good…”: Reasons at paragraph 102-103. This broad purpose
excludes any private duty of care to protect the economic interests of those
who rely on imported animals in their commercial activity.
[22]
The Judge
rejected the Beekeepers contention that the statutory purpose could be found in
the RIASs which accompanied the issuance of the regulations over the years.
While acknowledging that these statements had been accepted as an aid in
construing the regulations with which they were associated, the Judge rejected
the notion that they “established the intent and purpose of the
governing statute”: Reasons at paragraph 107.
[23]
The Judge
concluded his analysis on this leg of the Anns test by quoting from the
Supreme Court’s decision in R. v. Imperial Tobacco Canada Ltd.,
2011 SCC 42, [2011] 3 S.C.R. 45 (Imperial Tobacco) at paragraph 50, to
the effect that he failed to see how “it could
be possible to convert any of the Minister’s public law discretionary powers,
to be exercised in the general public interest, into private law duties owed to
specific individuals”: Reasons at
paragraph 109. As a result, the Judge rejected the claim of proximity based on
the statutory scheme.
[24]
I am in full agreement
with the Judge’s analysis on this leg of the test and propose to say no more
about it.
[25]
The Judge then
examined the question of whether the course of conduct between the respondents
and the beekeeping industry could give rise to sufficient proximity to support
a prima facie duty of care. He noted the absence of a statutory
obligation to consult the industry which led him to comment that the fact that
consultations took place did not alter the purpose of the Act.
[26]
The Judge noted
the Beekeepers’ argument that the RIASs, particularly the one issued in
conjunction with the HIPR 2004, discussed “costs and measures to alleviate the impact [of the import
ban] on the industry and that concerns related to the public at large were
barely mentioned”: Reasons at paragraph
111. On the other hand, the Judge underlined that the Beekeepers’ allegations
of interaction with the industry were based on consultations surrounding the
need to prolong the ban on importation and were very general. In particular,
the Judge noted that the Beekeepers did not plead that they had applied for and
were refused a permit for the importation of packages. He concluded that the
Beekeepers pleadings did not establish a sufficient degree of proximity arising
from their interaction with the respondents to give rise to a duty of care.
[27]
By way of
abundant caution, the Judge continued his analysis and considered the second
leg of the Anns test, namely whether there were any overriding policy
considerations which would negate any prima facie duty of care found to
exist under the first leg of the test.
[28]
The Judge agreed with
the respondents’ contention that the finding of a duty of care would expose
them to indeterminate liability. Given that the Beekeepers are but one of many
participants in the agricultural sector, a finding of a duty of care would open
the door to claims by the other participants in that sector, putting the
respondents in an untenable position, that of indeterminate liability,
particularly in a case such as this where the claim was for pure economic loss.
[29]
The Judge went on
to characterize the Minister’s decision to refuse import permits as a true
policy decision, relying on dicta from Imperial Tobacco, cited
above. He found that the ban on the importation of packages represented “a course of action based on a balancing of public policy
considerations, such as social and economic considerations”: Reasons at paragraph 118.
[30]
These two intermediate
conclusions supported the Judge’s ultimate conclusion that there were policy
reasons which would negate any prima facie duty of care, had one been
found to exist under the first leg of the Anns test.
[31]
The Judge
considered the Beekeepers’ allegations that the Minister had improperly
delegated his discretion to a third party, which he rejected as deficient,
since it was not pleaded that someone other than the Minister adopted the
policy in question.
[32]
The Judge also
rejected the Beekeepers’ allegations of improper relationships between the
respondents and the Canadian Honey Council.
[33]
In the end result, the Judge
concluded that, even when the Beekeepers’ proposed amendments were considered,
no reasonable cause of action was made out.
[34]
On the issue of
costs, the Judge relied on the authority of Pearson v. Canada, 2008 FC
1367, and found that since the action had not yet been certified as a class
action, Rule 334.39 did not apply. Rule 334.39 precludes the making of an order
for costs against “any party to a motion for
certification of a proceeding as a class proceeding” with certain exceptions, none of which are relevant
to these proceedings.
IV.
ISSUES
[35]
The issues raised
by this appeal are the following:
1.
What is the standard of review for our review of the
Judge’s decision?
2.
Is it plain and obvious that the Beekeeper’s claim in
negligence is bound to fail?
3.
Assuming that they are successful, are the respondents entitled
to costs?
V.
THE STANDARD OF REVIEW
[36]
The parties are
agreed that a judge’s decision to strike a claim is discretionary; it should
not be disturbed in the absence of an error of law, a misapprehension as to the
facts, a failure to give appropriate weight to all relevant factors or an
obvious injustice: Bauer Hockey Corp. v. Sport Maska Inc., 2014 FCA 158
at paragraph 12; Apotex Inc. v. Canada (Governor in Council), 2007 FCA
374 at paragraph 15. However, even where the judge has erred in the exercise of
discretion, the appellants are not entitled to succeed unless they are able to
show that a proper exercise of that discretion would lead to a different
result.
[37]
The test for striking out a statement of claim
for failing to disclose a reasonable cause of action is whether it is “plain and obvious” that the claim must fail. A claim
must not be struck simply because it is complex, or because the plaintiff puts
forward a novel cause of action:
[a]ssuming that the facts as stated in the
statement of claim can be proved, is it "plain and obvious" that the
plaintiff's statement of claim discloses no reasonable cause of action? As in England, if there is a chance that the plaintiff might succeed, then the plaintiff should
not be "driven from the judgment seat". Neither the length and complexity
of the issues, the novelty of the cause of action, nor the potential for the
defendant to present a strong defence should prevent the plaintiff from
proceeding with his or her case.
Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959 at page 980
[38]
Since the Judge correctly identified the test,
the question before this Court is whether he applied it properly.
VI.
IS IT PLAIN AND OBVIOUS
THAT THE BEEKEEPERS’ CLAIM IN NEGLIGENCE IS BOUND TO FAIL?
[39]
Having regard to my
colleague’s comments in his reasons as to the construction of pleadings, it is
perhaps appropriate to summarize the Beekeepers’ pleadings, if only to put my
reasons in context. After setting out the relevant facts in paragraphs 2 to 23,
the Beekeepers plead, at paragraph 24, that they rely upon the Crown
Liability and Proceedings Act, R.S.C. 1985, c. C-50, which provides for the
liability of the Crown in tort in the common law provinces
[40]
In paragraph 25, the
Beekeepers identify the stated purpose of the legislation, including the Regulations.
Paragraph 26 begins “The
Defendants owed a duty of care to the Plaintiffs…”. This is followed by subparagraphs a) to
f) which set out the facts from which this duty of care arose. The proposed
amendments to the Beekeepers statement of claim set out 16 new paragraphs
containing further particulars as to the basis of the duty of care.
[41]
Paragraph 27 of the
statement of claim itemizes the elements of the duty of care which I take to be
a statement of the standard of care the respondents owed to the Beekeepers.
Subparagraphs a) to j) set out the particulars of the standard of care.
[42]
Paragraph 28 of the
statement of claim then alleges that the respondents breached their duty of
care by doing the various acts which are itemized in subparagraphs a) to j). In
paragraph 29, the Beekeepers plead that the respondents knew or ought to have
known that their negligence “and
the improper continuation of the Prohibition [on importation]” would cause them loss and damage.
[43]
Paragraph 30 sets out
the particulars of the loss and damage suffered by the Beekeepers.
[44]
In the introductory
paragraphs of the statement of claim, the Beekeepers pleaded that they claimed
damages as a result of the respondents “acting without lawful authority” in prohibiting the importation of honeybee packages
after the expiry of HIPR 2004. In their proposed amendments to the
statement of claim, the Beekeepers abandoned their claim for damages based on
the respondents’ lack of lawful authority.
[45]
The Beekeepers chose to
sue the respondents in negligence. The fact that the pleadings allege facts
which, if proved, would give rise to administrative law remedies does not, in
and of itself, establish negligence: Holland, cited above, at paragraph 9. The Beekeepers
appear to have recognized this when they proposed to delete from their
statement of claim the head of damages arising from the respondents’ lack of
lawful authority to do what they did.
[46]
In my view, despite the various administrative
law issues which the facts pleaded by the Beekeepers raise, this appeal is
solely concerned with whether or not their pleadings disclose a reasonable
cause of action in negligence.
[47]
As noted above, the law on the liability of
public authorities in negligence is determined by the test in Anns v. Merton
London Borough Council, [1978] A.C. 728 (Anns), adopted by the
Supreme Court of Canada in Kamloops (City of) v. Nielsen, [1984] 2
S.C.R. 2, and explained in Cooper v. Hobart, 2001 SCC 79, [2001] 3
S.C.R. 537. This law was most recently canvassed in Imperial Tobacco,
cited above.
[48]
The Anns test is a two part test: (1) do
the facts disclose a prima facie duty of care, that is, a relationship
of proximity which makes it just and reasonable to impose an obligation to take
reasonable care to prevent foreseeable harm; and (2) are there policy reasons
why this prima facie duty of care should not be recognized.
[49]
I would point out that there are two
formulations in the jurisprudence, indeed within Imperial Tobacco
itself, as to the first leg of the Anns test. At paragraph 39 of Imperial
Tobacco, the Supreme Court frames the test as “whether
the facts disclose a relationship of sufficient proximity in which failure to
take reasonable care might foreseeably cause cause harm or loss to the
plaintiff.” Further on, at paragraph 41, the Court says:
Foreseeability must be grounded in a
relationship of sufficient closeness, or proximity, to make it just and
reasonable to impose an obligation on one party to take reasonable care not to
injure the other.
[50]
The reference to “just
and reasonable” underlines that there is a policy element in the first
leg of the test, a fact which the Court recognized in Cooper v. Hobart:
In brief compass, we suggest that at this
stage in the evolution of the law, both in Canada and abroad, the Anns
analysis is best understood as follows. At [page551] the first stage of the Anns
test, two questions arise: (1) was the harm that occurred the reasonably
foreseeable consequence of the defendant's act? and (2) are there reasons,
notwithstanding the proximity between the parties established in the first part
of this test, that tort liability should not be recognized here? The proximity
analysis involved at the first stage of the Anns test focuses on factors
arising from the relationship between the plaintiff and the defendant. These
factors include questions of policy, in the broad sense of that word. If
foreseeability and proximity are established at the first stage, a prima facie
duty of care arises.
Cooper v. Hobart at paragraph 30
[51]
The point of this observation is to underline
that proximity cannot simply be treated as an aspect of foreseeability in the
sense that it addresses the question: was the defendant so situated relative to
the plaintiff that it was foreseeable that the latter might be harmed by the
former’s conduct? Proximity is to be seen as a limitation on foreseeability. As
the Supreme Court pointed out in Imperial Tobacco, at paragraph 41, “[n]ot every foreseeable outcome will attract a commensurate
duty of care.” The proximity requirement seeks to identify within the
universe of all relationships in which the acts of one party might injure
another, those relationships in which it is just and reasonable to impose a
duty of care to avoid that foreseeable harm.
[52]
My conclusion is that the articulation of the
proximity found at paragraph 41 of Imperial Tobacco is a fuller
expression of the test than is the articulation found in paragraph 39, which I
take to be a shorthand expression of the test.
[53]
The question in this case is whether there was a
sufficient degree of proximity between the Beekeepers and the respondents to
give rise to a duty of care. Proximity may arise from the statutory scheme
itself or it may arise from the interactions between the parties. I have
already indicated that I see no error in the Judge’s conclusion that there is
no relationship of proximity, and no corresponding prima facie duty of
care, arising from the statutory scheme.
[54]
These reasons deal with the issue of proximity
arising from the course of conduct between the parties. In addressing that
question, we may look at “expectations,
representations, reliance, and the property or other interests involved”;
there is no single unifying characteristic: Cooper v. Hobart at
paragraphs 34-35.
[55]
This case is similar to Imperial Tobacco
in that it involves the decisions of a regulatory authority. It is different in
the sense that the Beekeepers are not, per se, the regulated entity. They are
one group, among others, who may be affected by the regulators’ decisions.
Other affected groups include agricultural producers who rely upon pollination
of their crops by honeybees, as well as processors who use those agricultural
products as an input for their products. That said, the difference is
admittedly one of degree and not one of kind.
[56]
The conduct which gave rise to a relationship
of proximity in Imperial Tobacco was Canada’s departure from its role as
regulator and its assumption of that of “designer,
developer, promoter and licensor of tobacco strains”: see Imperial
Tobacco at paragraph 54.
[57]
What facts have the Beekeepers pleaded which could
give rise to a relationship of proximity with the respondents? The statement of
claim recites the history of the ban on importation of honeybees from the
continental United States. At paragraph 20 and following of the statement of
claim they note that, with the expiry of HIPR-2004, the respondent
adopted a policy of banning the importation of honey bee packages from the United States, without conducting a risk assessment.
[58]
The Beekeepers identify representations made to
the Canadian beekeeping industry to the effect that the respondents regulated
bee imports for the purpose of protecting the beekeeping industry, that the
restrictions on importation would be maintained only so long as the risk to the
honeybee population existed, that the respondents would continuously monitor
the situation to determine when the restrictions could be lifted. These
representations were made in the RIASs which accompanied each exercise of the
regulatory power. The Beekeepers do not plead that they relied on these
representations.
[59]
The Beekeepers also plead that the respondents’
actions were aimed at fostering and protecting the viability of the beekeeping
industry, and that the respondents knew of the economic hardship suffered by
certain beekeepers and beekeeping regions as a result of the restrictions on
importation. In addition, the Beekeepers also plead that the respondents
originally consulted and cooperated with the Canadian Honey Council, provincial
beekeeping associations, individual beekeepers and other stakeholders. After
2006, the respondents consulted exclusively with the Canadian Honey Council
which it knew or ought to have known was dominated by a faction which had an
economic interest in maintaining the restriction on importation of honey bees.
[60]
As I read the statement of claim, these are the
facts pleaded by the Beekeepers which could give rise to a relationship of
proximity. They plead other facts, specifically the particulars of the actions
which caused them harm. It is important to recognize that an analysis of proximity
based on a course of conduct cannot rest on the very conduct which is alleged
to have caused damage to the plaintiff. Such an analysis would make existence
of the prima facie duty of care a function of the occurrence of damage.
At that point, the Anns test becomes a tautology. It is the relationship
of proximity which imposes on the defendant the obligation not to do that which
has caused harm to the plaintiff. As a result, the plaintiff must be able to
establish proximity without reference to the acts which it claims caused it
harm.
[61]
It is clear from these facts that the
respondents acted in their capacity as regulators and did so in consultation
with the beekeeping industry. They did not assume a role outside their
regulatory role, though it is alleged in the rest of the statement of claim
that they discharged their regulatory responsibilities badly. This
distinguishes this case from Imperial Tobacco where the relationship of
proximity was found to exist by reason of the additional non-regulatory roles
adopted by Canada’s officials. Imperial Tobacco is not the only template
for proximity based on a course of conduct but, at the very least, it can be
said that these facts do not fit that template.
[62]
I have difficulty conceiving how these facts
could constitute a course of conduct giving rise to a relationship of
proximity. Statutory authority is given to public authorities so that they can
act in the public interest. When they do so, private interests may suffer. That
private loss cannot be the basis of a relationship of proximity. To find that
it did would be to find that, where a relationship of proximity is not created
by a statutory scheme, it can be created by actions taken to give effect to the
statutory scheme. As the relationship of proximity cannot rest upon the conduct
causing the harm, such a conclusion is illogical.
[63]
In the same vein, one must be cautious about
treating representations made in the course of exercising a regulatory power as
a basis for a relationship of proximity, particularly when reliance on those
representations is not pleaded. In this case, Judge found that the protection
of the economic interests of the Beekeepers was not the object of the statutory
scheme. I agree with that conclusion. As a result, statements made in the RIASs
go no further than providing a context for the respondents’ actions.
[64]
As for the question of the respondents’
relationship with the Canadian Honey Council, one presumes that the respondents
dealt with this organization because it is or was the beekeeping industry’s
national industry organization. It is a rare organization whose members’
interests are all perfectly aligned. There are always rump groups within and
without national organizations who claim that their interests are not being
properly represented. If the fact that the government chooses a national
organization as its privileged interlocutor is taken to create a relationship
of proximity, governments would be disinclined to consult, a trend which ought
not to be encouraged.
[65]
My colleague raises the issue of bad faith on
the part of the respondents. The Beekeepers did not specifically plead bad
faith. I do not believe that facts which they did plead lend themselves to that
characterization. The Beekeepers plead that the respondents knew that the Canadian
Honey Council was dominated by a faction that had an economic interest in
maintaining the prohibition on importation. They also plead that the
respondents at some point ceased to consult with anyone other than the Canadian
Honey Council. But they do not plead that the respondents acted with a view to
advancing the faction’s interests, or that they misrepresented their motives.
[66]
Bad faith is generally taken to refer to
deliberate conduct. I am aware of the Supreme Court’s decision in Finney v.
Barreau du Québec, 2004
SCC 36, [2004] 2 S.C.R. 17 (Finney), in which the issue was whether the
Barreau could rely on the immunity granted to it by statute so long as it was
acting in good faith. The Supreme Court held that bad faith “must be given a broader meaning that encompasses serious
carelessness or recklessness”: see Finney, at p.38-39. I would
suggest that the Supreme Court decided that case on a wider ground than was
necessary. The issue before it was the absence of good faith; persons who act
recklessly may not be acting in good faith but they are not necessarily acting
in bad faith. In any event, the Beekeepers did not plead recklessness or gross
negligence.
[67]
To the extent that bad faith is used to anchor a
claim in negligence, it suffers from the same defect as other acts which cause
harm, namely they cannot be the basis for a finding of proximity.
[68]
The source of the difficulty in dealing with
this claim is that while it is framed as an action in negligence, all of the
particulars of negligence are acts for which a remedy is available in
administrative law. Taking the pleadings at face value, the Beekeepers have
been the victims of abusive administrative action. Had they sought judicial
review of those abusive actions in a timely fashion, they could have limited,
if not prevented, the losses of which they now seek to recover in their
negligence action. This is not a case in which the Beekeepers were victims of
misconduct for which there is or was no other recourse. There was a readily
available remedy which they chose not to exercise. In my view, it is not just
and reasonable to impose a prima facie duty of care in negligence when the
injury complained of could have been limited or prevented entirely by the
exercise of a readily available remedy.
[69]
One could argue that the better course would be
to find a duty of care but to take the availability of another remedy into
account under the heading of mitigation. With respect, this reasoning is more
appropriate to a case where the alternative remedy offers only a partial
solution. Where, as here, a prompt application for judicial review on an
expedited basis could have prevented or radically minimized the losses which
are being claimed, I believe that the better policy is to require plaintiffs to
exercise the rights they already have rather than finding new remedies.
[70]
To the extent that this case concerns the
boundary between public law and private remedies, I would say, despite my
colleague’s thoughtful analysis, that the distinction is now firmly entrenched
in our law. Though the sentiments expressed by Iacobucci J. in Fraser River
Pile & Dredge Ltd. v. Can-Dive Services Ltd., [1999] 3 S.C.R. 108 (Fraser
River) may seem quaint in light of recent developments, I believe they
remain relevant and worthy of consideration:
Fraser River has also argued that to relax the doctrine of privity of contract
in the circumstances of this appeal would be to introduce a significant change
to the law that is better left to the legislature. As was noted in London
Drugs, supra, privity of contract is an established doctrine of
contract law, and should not be lightly discarded through the process of
judicial decree. Wholesale abolition of the doctrine would result in complex
repercussions that exceed the ability of the courts to anticipate and address.
It is by now a well-established principle that courts will not undertake
judicial reform of this magnitude, recognizing instead that the legislature is
better placed to appreciate and accommodate the economic and policy issues
involved in introducing sweeping legal reforms.
Fraser River,
cited above, at paragraph 43
[71]
In summary, I find that the Beekeepers have not
shown that there was a relationship of proximity between them and the
respondents such that a prima facie duty of care arose. That being the
case, I do not need to address the second leg of the Anns test.
[72]
As a result, I agree with the Judge’s
disposition of the application to strike out the statement of claim.
VII.
ARE THE RESPONDENTS ENTITLED TO COSTS?
[73]
This statement of claim in this matter relates
to a proposed class action. On the authority of Pearson v. Canada, cited
above, the Judge held that the respondents were entitled to costs because the
action had not yet been certified as a class proceeding.
[74]
It is unfortunate that this Court’s decision in Campbell
v. Canada (Attorney General), 2012 FCA 45, was not brought to the Judge’s
attention. In that case, this Court held that the immunity from costs provided
for in Rule 334.39(1) of the Federal Courts Rule’s SOR/98-106, applied
from the time the motion for certification is served on the defendants because
that is the point in time at which the plaintiffs become a “party to a motion for certification of a proceeding as a
class proceeding”. In this case, the
motion for certification was served before the motion to strike was served or
heard. As a result, the Beekeepers (i.e. the plaintiffs in the action)
are entitled to the immunity from costs contemplated by Rule 334.39(1). To the
extent that it might be argued that the plaintiffs lost that immunity because
of the submission of their proposed amended statement of claim, it appears that
the Judge misconstrued the Beekeepers’ intentions.
[75]
As a result, I would allow the appeal in part
and vary the judgment of the Federal Court to remove the award of costs in
favour of the respondents. In all other respects, I would dismiss the appeal
without costs.
“J.D. Denis Pelletier”
STRATAS J.A.
[76]
I agree with my colleague’s account of the
relevant background to this appeal and the facts. I agree with him that, on a
motion to strike, all allegations in the claim must be taken as true and that
the claim is to be struck only where it is plain and obvious the claim will
fail. Further, I agree with his observation in paragraph 68, above, that if we
take the allegations as true, the beekeepers have been victims of abusive
administrative action on the part of the respondents (Canada).
[77]
The Federal Court and my colleague conclude that
it is plain and obvious that the beekeepers’ claim for damages must fail. I
disagree. In my view, taking the allegations in the claim as true, the claim
cannot be struck. In my view, the facts as pleaded support a claim in
negligence and bad faith. Were it necessary, I would also conclude that the
facts pleaded support a claim for monetary relief in public law.
A.
The claim
for negligence and bad faith
(1)
Identifying the
alleged conduct of Canada that is the subject of the claim
[78]
The first step is to identify the conduct
attacked in the claim. Here, two documents are relevant: the statement of claim
and a proposed amended statement of claim. The latter particularizes some of
the conduct alleged in the former.
[79]
The Federal Court viewed the proposed amended
statement of claim as an improper attempt to amend the statement of claim after
Canada had moved to strike it. Despite that, the Federal Court considered the
conduct set out in both documents: Federal Court’s reasons at paragraph 84.
[80]
In this Court, the beekeepers say that
delivering a proposed amended statement of claim was proper. I agree. The
beekeepers did not move to amend their claim. Instead, they delivered it to
show that certain problems raised by Canada – for example, a lack of
particularity in the allegations – could be overcome. This is proper and
accepted practice: Collins v. Canada, 2011 FCA 140; 418 N.R. 23. The proposed amended statement of claim
is properly before us and sheds light on some of Canada’s alleged conduct.
(2)
The alleged
conduct
[81]
On a motion to strike, all of the beekeepers’
allegations must be taken as true. Therefore, these reasons recount the
allegations as if they have been definitively established. They have not. Only
after a trial will we know whether Canada conducted itself as the beekeepers
say.
[82]
The Honeybee Importation Prohibition
Regulations, 2004, S.O.R./2004-136 prohibited the importation of packages
of honeybees from the United States. At the end of 2006, those regulations
expired according to their terms. Canada did not enact new regulations
extending or re-establishing the prohibition. Rather, Canada implemented and enforced a blanket guideline – not a law – that did the same thing that the
expired regulations did. The blanket guideline prohibited the importation of packages
of honeybees from the United States.
[83]
Resting alongside this blanket guideline,
however, is section 160 of the Health of Animals Regulations, C.R.C., c.
96. Under that section, the beekeepers can apply for importation permits
on a case-by-case basis. They are entitled to receive permits and import
honeybees where the importation “would not, or would
not be likely to, result in the introduction into Canada, the introduction into
another country from Canada or the spread within Canada, of a vector, disease
or toxic substance.”
[84]
In short, section 160 conditionally allows
imports. But, say the beekeepers, the bureaucrats have created and enforced a
guideline that unconditionally prevents the beekeepers from accessing section
160 under any circumstances. The beekeepers’ claim basically asserts that the
bureaucrats have no right to trump the law expressed in section 160 that
permits imports in certain circumstances.
[85]
As my colleague suggests, the facts the
beekeepers allege could prompt an award of administrative law remedies against
the guideline:
•
The guideline is tantamount to a regulation that
should have been passed as a regulation: see, e.g., Ainsley Financial
Corp. v. Ontario (Securities Commission) (1994), 21
O.R. (3d) 104; 121 D.L.R. (4th) 79 (C.A.).
•
The guideline imposes an absolute prohibition
against importation and, thus, conflicts with the law on the books, section 160
of the Health of Animals Regulations, above.
•
The guideline is unreasonable within the meaning
of Dunsmuir v. New Brunswick, 2008 SCC 9, [2008] 1 S.C.R. 190, as it is
not supported by any scientific evidence of a risk of harm due to importation.
The last risk assessment was several years out of date.
•
A faction of commercial beekeepers, acting for
their own financial advantage, captured the bureaucracy and induced it to make
the guideline; thus, the guideline was enacted for an improper purpose: see, e.g.,
Re Multi-Malls Inc. and Minister of Transportation and Communications (1977), 14 O.R. (2d) 49, 73 D.L.R. (3d) 18 (C.A.); Doctors
Hospital v. Minister of Health et al. (1976), 12
O.R. (2d) 164, 68 D.L.R. (3d) 220 (Div. Ct.).
(3)
The Federal
Court’s decision
[86]
The Federal Court struck the beekeepers’ claim
on the ground that it was plain and obvious it could not succeed. In my view,
the Federal Court erred on some of the issues before it and should not have
struck the pleading.
[87]
First, in my view, the Federal Court erred in
dealing with the beekeepers’ allegation that Canada pursued an improper purpose
or acted in bad faith in creating and implementing the blanket guideline. The
Federal Court weighed the allegation and summarily rejected it out of hand,
saying it is “not…convincing”: Federal Court’s
reasons at paragraph 119. This offends the principle that on a motion to
strike, allegations must be taken as true unless they are “manifestly incapable of being proven”: R. v.
Imperial Tobacco Canada Ltd., 2011 SCC 42, [2011] 3 S.C.R. 45 at paragraph
22. True, the allegations in the original statement of claim are not
well-particularized, but Canada pleaded to them, waiving whatever rights it had
to object on that basis. Here, the allegations, as particularized in the
proposed amended statement of claim, can be proven through evidence obtained
from discovery, access to information requests and trial proceedings. And these
allegations can succeed in law. Damages may be had against those who acted in
bad faith or followed an improper purpose: see, e.g., Roncarelli v.
Duplessis, [1959] S.C.R. 121, 16 D.L.R. (2d) 689; Chaput v. Romain,
[1955] S.C.R. 834, 1 D.L.R. (2d) 241; Gershman v. Manitoba (Vegetable
Producers’ Marketing Board) (1976), 69 D.L.R. (3d) 114, [1976] 4 W.W.R. 406
(Man. C.A.); Proulx v. Quebec (Attorney General), 2001 SCC 66, [2001] 3
S.C.R. 9 (Crown attorneys, as public officials, pursuing an improper purpose).
Further, while, as we shall see, a claim of negligence can be barred for policy
reasons, that bar does not apply where the conduct is “irrational”
or “taken in bad faith”: see Imperial Tobacco,
above at paragraphs 74 and 90.
[88]
The Federal Court next considered whether the
beekeepers’ claim could succeed in negligence. In particular, it examined
whether Canada owed the beekeepers a duty of care. Following the
well-established approach, it asked itself two questions:
(1)
Do the facts pleaded give rise to a relationship
of proximity in which Canada’s failure to take reasonable care might foreseeably
cause loss or harm to the beekeepers?
(2)
Are there policy reasons why a duty of care
should not be recognized?
(Imperial Tobacco, above at paragraph
39, citing Anns v. Merton London Borough Council, [1977] UKHL 4, [1978]
A.C. 728, adopted and reformulated in Kamloops (City of) v. Nielsen,
[1984] 2 S.C.R. 2, 10 D.L.R. (4th) 641 and Cooper v. Hobart, 2001
SCC 79, [2001] 3 S.C.R. 537.)
[89]
On the first question, the Federal Court
accepted that, on the facts pleaded, the claim should not be struck for want of
proximity: Federal Court’s reasons at paragraph 114. On this point, the Federal
Court did not err.
[90]
The Supreme Court itself has observed that where
there are “specific conduct and interactions”
supporting proximity and the legislation does not foreclose a finding of
proximity, it “may be difficult” to find lack of
proximity: Imperial Tobacco, above at paragraph 47; see also Cooper,
above at paragraphs 34-35 and Hill v. Hamilton-Wentworth Regional Police
Services Board, 2007 SCC 41, [2007] 3 S.C.R. 129 at paragraphs 29-30. This
is the situation here. The beekeepers plead that in specific interactions, Canada assured them that imports affecting their economic interests would be banned only as
long as there was scientific evidence of risk: see paragraph 26 of the
statement of claim, as particularized by the proposed amended statement of
claim. Absent that evidence of risk and but for the blanket guideline, Canada had to issue importation permits under section 160 of the Health of Animals
Regulations, above. In light of these considerations, the relationship between
Canada and the beekeepers is sufficiently close and direct to make it fair and
reasonable that Canada be subject to a duty to respect the beekeepers’
interests, at least to the extent of making rational, evidence-based decisions
following proper legislative criteria: Cooper, above at paragraphs
32-36; Hill, above at paragraph 29; Sauer v. Canada (Attorney
General), 2007 ONCA 454, 225 O.A.C. 143.
[91]
Put another way, the relationship between the
beekeepers and Canada, as pleaded, is one of well-defined rights and
entitlements based on specific legislative criteria, alongside specific
interactions and assurances between the two. It is not one where someone is
seeking a general benefit that may or may not be granted depending on a
subjective weighing and assessment of policy factors.
[92]
As mentioned above, the second question for
determining whether a duty of care is present asks whether there is a policy
bar. The Federal Court said there was one. In its view, the blanket guideline
implemented Canada’s important public duty to protect Canadians’ health and
safety. Recognizing a duty of care – in effect requiring Canada to have regard to the beekeepers’ interests – would conflict with that public duty: Federal
Court’s reasons at paragraph 92. Accordingly, the Federal Court held that Canada must be completely immunized from suit: Federal Court’s reasons at paragraph 103. In
reaching this result, the Federal Court interpreted and applied Imperial
Tobacco, above, and relied heavily upon it.
[93]
I do not agree that a policy bar dooms the
beekeepers’ claim to certain failure. Further, I do not agree with the Federal
Court’s interpretation and application of Imperial Tobacco. These points
deserve closer examination.
(4) The policy bar and Imperial Tobacco
[94]
Taking the allegations in the statement of claim
as true, I find nothing that implicates public policies or public duties in
such a way that would trigger a policy bar. The Federal Court erred in finding
to the contrary.
[95]
As mentioned above, the beekeepers’ claim
focuses on their inability to import honeybees from the United States under section 160 of the Health of Animals Regulations, above. Section
160 says that permits “shall” be granted on a
case-by-case basis where the importation will not bring a “vector, disease or toxic substance” to Canada. In other words, the public policy established by the law on the books favours
importation in appropriate circumstances. According to the beekeepers, those
circumstances existed, and importation should have been allowed. Thus, in this
case, there is no inconsistency between the existence of a private law duty of
care to the beekeepers and the public duty Canada owed. This case is on all
fours with Hill, above, where the Supreme Court found (at paragraphs
36-41) that the imposition upon the police of a private duty of care to an
individual suspect in the circumstances of the case before it was consistent
with the broader public duty upon the police to investigate criminal activity
effectively and fairly.
[96]
The Federal Court suggested that the old
regulations, the Honeybee Importation Prohibition Regulations, 2004, above
were aimed at protecting Canadians’ health and safety and support a broad
public interest policy bar in this case: Federal Court’s reasons at paragraph
106. The Federal Court acknowledged that those regulations expired at the end
of 2006 but found that the purpose behind them somehow continued, supporting
the creation and enforcement of the blanket guideline: Federal Court’s reasons
at paragraph 106.
[97]
On this, the Federal Court erred. It is trite
law that administrative action can only be supported by the law on the books: Apotex
Inc. v. Canada (Attorney General), [1994] 1 F.C.
742, 162 N.R. 177 (C.A.), aff’d [1994] 3
S.C.R. 1100, 176 N.R. 1; Janssen Inc. v. Teva Canada Limited,
2015 FCA 36. Expired laws are no longer on the books. In this case, once the
regulations expired, any public policies and public duties expressed in the
regulations also expired.
[98]
In support of its conclusion that the
beekeepers’ claim was subject to a policy bar and should be struck, the Federal
Court held that recognizing a duty of care “could have”
a chilling effect on Canada’s performance of its duties: Federal Court’s
reasons at paragraph 92. Here, again I disagree. In law, this standard – “could have” – sets the bar far too low. One can
always speculate that recognizing a duty of care could have a chilling effect.
Such a low standard would immunize government from liability in every case of
bureaucratic ineptitude, no matter how substandard or damaging the misconduct
may be. No court anywhere has set the bar that low.
[99]
In any event, if the beekeepers recover damages,
I cannot see any regulator, including the Minister, being chilled from
exercising jurisdiction in any way. The Minister is being sued for improperly
refusing to consider section 160 applications. If the beekeepers succeed, the
Minister will then freely decide whether permits should be granted on the basis
of the facts and the scientific evidence. In any judicial review, the
Minister’s factually-suffused, scientifically-based decision will be just as
difficult to set aside as before.
[100] Both in this Court and below, Canada invokes the possibility of
indeterminate liability as support for a policy bar. Here, there is no such
possibility. The class of claimant is limited and the circumstances alleged to
give rise to liability are most uncommon.
[101] As well, certain factors serve to cap the damages claim. In the
assessment of damages at trial, the judge will consider what would have
happened had the Minister acted properly, i.e., what would have happened
in a “but for” world where the blanket guideline
did not exist. In that “but for” world, the
beekeepers would have had to apply for permits under section 160 of the Health
of Animals Regulations, above. If permits would not have been available
under that section anyway – for example, because at all material times there
was a risk of disease and harm arising from importation of bees from the United
States – the beekeepers will not be entitled to damages. This shows that the
important purpose of protecting the public, relied upon by the Federal Court
and my colleague as a policy bar, can still have an appropriate voice in the
assessment of damages, perhaps even reducing them to nil. But at this
preliminary stage, it cannot be said the “plain and
obvious” threshold for striking out the claim has been met.
[102] I turn now to Imperial Tobacco, above, a case relied upon by
the Federal Court to find that the beekeepers’ claim is subject to a policy bar
under the second branch of the duty of care test.
[103] In Imperial Tobacco, the Supreme Court states that if a duty of care “would conflict with the state’s general public
duty established by the statute,” the
court “may” not
find one: at paragraph 45. That sentence appears in a section that suggests
broadly that “expressions
of government policy” are exempted from
liability for damages: at paragraph 62. The Supreme Court also speaks of
matters of “core policy” that are protected from suit: at paragraph 90. The Federal
Court regard some or all of these statements as clear propositions preventing
recognition of a duty of care upon Canada to the beekeepers.
[104] I disagree. I do not accept that Imperial Tobacco establishes
any hard-and-fast rule that decisions made under a general public duty,
government policy or core policy are protected from a negligence claim.
[105] The statement in paragraph 45 of Imperial Tobacco about a “general public duty” contains the word “may,” a qualifier. Unfortunately, the Supreme Court
is silent about when that qualifier applies. Further, the Supreme Court does
not define what qualifies as a “general public duty.”
Nor does it define the meaning of “expressions of
government policy” in paragraph 62. We are left to fend for ourselves.
[106] As for “core policy” matters that are
protected from suit, the Supreme Court offers this definition (at paragraph
90):
“[C]ore policy” government decisions
protected from suit are decisions as to a course or principle of action that are
based on public policy considerations, such as economic, social and political
factors, provided they are neither irrational nor taken in bad faith.
[This]…does not purport to be a litmus test. Difficult cases may be expected to
arise from time to time where it is not easy to decide whether the degree of
“policy” involved suffices for protection from negligence liability. A black
and white test that will provide a ready and irrefutable answer for every
decision in the infinite variety of decisions that government actors may
produce is likely chimerical. Nevertheless, most government decisions that
represent a course or principle of action based on a balancing of economic,
social and political considerations will be readily identifiable.
[107] In the first sentence of this paragraph, we are told that “decisions…based on public policy considerations” are immune.
But most decisions are based on public policy considerations; indeed, all
considerations to be taken into account by decision-makers under legislation
are public policy considerations.
[108] Also in the first sentence, we are told that examples – not
exhaustive – of public policy considerations are “economic,
social and political factors.” But that covers just about everything on
the legislative books in the area of regulation. Read literally, the first
sentence immunizes a broad zone of bureaucratic activity quite contrary to
fundamental principles of accountability in public law, and many decided cases
too, including many from the Supreme Court: see the discussion in Slansky v.
Canada (Attorney General), 2013 FCA 199, 364
D.L.R. (4th) 112 at paragraphs 313-314.
[109] But the first sentence does not stand alone. Four follow. They
whittle the definition down essentially to nothing, telling us immunity may or
may not apply, and any certainty is “likely
chimerical.” What should be immunized from liability is said to be “readily identifiable,” but no criteria for
identification are supplied. Again, we are left to fend for ourselves.
[110] I conclude that Imperial Tobacco does not stand for any clear
proposition that dooms the beekeepers’ claim to failure. If anything, Imperial
Tobacco leaves us more uncertain than ever as to when the policy bar will
apply.
[111] Therefore, for the foregoing reasons, I conclude that it is not
plain and obvious that the claim for negligence and bad faith will fail. The beekeepers’
claim should be allowed to continue.
B. The public law claim
[112] Given my views on the viability of the beekeepers’ claim in
negligence and bad faith, I need not go further. But all of us seem to agree
that the allegations in the claim, taken as true, could trigger an award of
administrative law remedies, or more generally public law remedies. Might a
monetary award based on public law principles be one of those remedies? For the
benefit of future cases, this warrants examination.
(1)
Construing
pleadings
[113] A statement of claim must contain allegations of material facts
sufficient to support a viable cause of action: Federal Courts Rules,
S.O.R./ 98-106, Rule 174. Plaintiffs need not plead the particular legal label
associated with a cause of action: Rule 175; see also Cahoon v. Franks,
[1967] S.C.R. 455 at pages 458-459. Similarly, plaintiffs who choose to use a
particular legal label are not struck out just because they chose the wrong
label: Sivak v. Canada, 2012 FC 272, 406 F.T.R. 115 at paragraph 20; J2
Global Communications Inc. v. Protus IP Solutions Inc., 2008 FC 759, 330
F.T.R. 176 at paragraphs 33-36; Johnson & Johnson Inc. v. Boston
Scientific Ltd., 2004 FC 1672, [2005] 4 F.C.R. 110 at paragraph 54.
[114] Instead, on a motion to strike, we must focus on whether the
allegations of material facts in the claim, construed generously, give rise to
a cause of action: Conohan v. Cooperators, 2002 FCA 60, [2002] 3 F.C.
421 at paragraph 15. This means any cause of action: Imperial Tobacco, above
at paragraph 21; Hunt v. Carey Canada Inc., [1990] 2 S.C.R. 959 at
pages 979-80, 74 D.L.R. (4th) 321; Operation Dismantle Inc. v. The Queen,
[1985] 1 S.C.R. 441 at pages 486-87, 18 D.L.R. (4th)
481. Sometimes the pleading gives rise to more than one cause of action.
It all depends on the substance of the pleading, not the labels. As Lord
Denning M.R. explained in In re Vandervell’s Trusts (No. 2), [1974] Ch. 269 at pages 321-22 (C.A.):
It is sufficient for the
pleader to state the material facts. He need not state the legal result. If,
for convenience, he does so, he is not bound by, or limited to what he has
stated. He can present, in argument, any legal consequence of which the facts
present.
[115] In their statement of claim, the beekeepers do use the legal label “negligence.” They have not used specific words
claiming monetary relief in public law. But, read generously, the allegations
of material facts in the statement of claim (as supplemented by the proposed amended
statement of claim) support that very thing. In substance, the beekeepers allege
they are victims of abusive administrative action warranting monetary relief.
Getting past the legal label and the technical form of the pleading, the real
issue before us is the viability of a claim for monetary relief in public law.
(2)
Novel claims
and motions to strike
[116] A claim for monetary relief in public law is novel. In assessing
whether a novel claim can survive a motion to strike, we must remember that the
common law is in a continual state of responsible, incremental evolution: R.
v. Salituro, [1991] 3 S.C.R. 654 at pages 665-70, 131 N.R. 161. While our
Constitution is a “living tree capable of growth and expansion within its natural
limits” (see Edwards
v. Canada (Attorney General), [1929] UKPC 86, [1930] A.C. 124), the common
law – and particularly public law – is not a petrified forest. A novel claim should not be struck just because it is novel. See Imperial
Tobacco, above at paragraph 21, Hunt, above at pages 979-80 and Operation
Dismantle, above at pages 486-87. However, as was said in Salituro,
above, and Fraser River Pile & Dredge Ltd. v. Can-Dive Services Ltd.,
[1999] 3 S.C.R. 108, 176 D.L.R. (4th) 257 at paragraph 42, judge-made reform to
judge-made law has its limits.
[117] When courts consider a novel claim, they must keep in mind a line.
On one side of the line is a claim founded upon a responsible, incremental extension
of legal doctrine achieved through accepted pathways of legal reasoning. On the
other is a claim divorced from doctrine, spun from settled preconceptions,
ideological visions or freestanding opinions about what is just, appropriate
and right. The former is the stuff of legal contestation and the courts; the
latter is the stuff of public debate and the politicians we elect.
[118] In my view, monetary relief based on public law principles qualifies
as the sort of novel claim that should not be struck on a motion to strike. It
falls on the appropriate side of the line. As we shall see, it is a responsible,
incremental change to the common law founded upon legal doctrine and achieved
through accepted pathways of legal reasoning. It does not throw into doubt the
outcomes of previous cases, but rather offers better explanations for them,
leading us to a more understandable, more coherent law of liability for public
authorities.
(3)
Assessing the
existing law, and seeing a better way forward
[119] One afternoon in a small, quiet café in Paisley, Scotland, Francis Minghella served May Donoghue a
bottle of ginger beer with a decomposed snail in it. So said a claim for
damages, at the time so novel it was met by a motion to strike: Donoghue v.
Stevenson, [1932] UKHL 100, [1932] A.C. 562. Upon the dismissal of that
motion, a body of law was born. For the last eighty-three years, that body of
law, with some modifications, has governed the liability of all private parties
– and all public authorities too, even giant, complex ones that today serve
millions.
[120] The difference between private parties and public authorities
matters not. For reasons never explained, Canadian courts have followed the
same analytical framework for each: we examine the duty of care, standard of
care, remoteness, proximity, foreseeability, causation and damages.
[121] To make this analytical framework suitable for determining the
liability of public authorities, courts have tried gamely to adapt it. And
then, dissatisfied with the adaptations, they have adapted the adaptations, and
then have adapted them even more, to no good end.
[122] Specifically, courts adapted the analytical framework for negligence
by inserting a double-barrelled test into it: Anns, above, imported into
Canadian law with some adaptations in Kamloops, above; and see my
reasons at paragraph 88, above. Under this test, proximity, not foreseeability,
gained prominence, with freestanding policy considerations playing a
significant role in shielding public authorities from liability.
[123] Further adaptations took place a little while later: Cooper, above;
Edwards v. Law Society of Upper Canada, 2001 SCC 80, [2001] 3 S.C.R.
562. These adaptations upon earlier adaptations have led to a number of cases
whose outcomes are hard to reconcile: to name a few, Syl Apps Secure
Treatment Centre v. B.D., 2007 SCC 38, [2007] 3 S.C.R. 83; Hill, above;
Fullowka v. Pinkerton’s of Canada Ltd., 2010 SCC 5, [2010] 1 S.C.R. 132;
see also Freya Kristjansen and Stephen Moreau, “Regulatory
Negligence and Administrative Law” (2012) 25 C.J.A.L.P. 103 at page 127
(many cases are “contradictory” and “in a state of lamentable confusion”).
[124] Courts have also tried to adapt the analytical framework for
negligence by distinguishing between policy matters and operational matters,
the former non-actionable, the latter actionable. At first, the Supreme Court
embraced this distinction wholeheartedly and unconditionally: Just v.
British Columbia, [1989] 2 S.C.R. 1228, 64 D.L.R. (4th) 689; Brown v.
British Columbia (Minister of Transportation and Highways), [1994] 1 S.C.R.
420, 112 D.L.R. (4th) 1; Swinamer v. Nova Scotia
(Attorney General), [1994] 1 S.C.R. 445,
112 D.L.R. (4th) 18; Lewis (Guardian ad litem of) v. British Columbia,
[1997] 3 S.C.R. 1145, 153 D.L.R. (4th) 594.
But after decades of enforcing this distinction and adapting it, the Supreme
Court has now concluded that it is unworkable as a legal test: Imperial
Tobacco, above at paragraphs 78 and 86.
[125] And now we have Imperial Tobacco, a decision that, as we have
seen, provides little tangible direction. It has spawned a fresh wave of
academic criticism: see, e.g., Paul Daly, “The
Policy/Operational Distinction – A View from Administrative Law”, in
Matthew Harrington, ed., Compensation and the Common Law (Toronto:
LexisNexis) [forthcoming in 2015] (“the concept of
[core policy]…immune from liability…threatens to wreak further confusion”);
Bruce Feldthusen, “Public Authority Immunity from
Negligence Liability: Uncertain, Unnecessary, and Unjustified” (2014) 92
Can. Bar Rev. 211 at pages 214 and 216-217 (using the presence or absence of
policy to bar recovery is “inherently uncertain,”
“incapable of identifying a predictable or correct
decision…” and “a slippery exercise at best”).
[126] Today, despite the best efforts of the Supreme Court and other
courts, the doctrine governing the liability of public authorities remains
chaotic and uncertain, with no end in sight. How come?
[127] At the root of the existing approach is something that makes no
sense. In cases involving public authorities, we have been using an analytical
framework built for private parties, not public authorities. We have been using
private law tools to solve public law problems. So to speak, we have been using
a screwdriver to turn a bolt.
[128] Public authorities are different from private parties in so many
ways. Among other things, they carry out mandatory obligations imposed by
statutes, invariably advantaging some while disadvantaging others. As for the
duty of care, does it make sense to speak of public authorities having to
consider their “neighbours”– the animating
principle of Donoghue v. Stevenson – when they regularly affect
thousands, tens of thousands or even millions at a time? As for the standard of
care, how can one discern an “industry practice”
that would inform a standard of care given public authorities’ wide variation
in mandates, resources and circumstances? Even if these questions are
satisfactorily answered, others remain. For example, the defence of consent – a
defence that keeps the liability of many private parties in check – is often
impractical or impossible for public authorities. And, unlike private parties,
many other less drastic tools exist to redress public authorities’
misbehaviour, including certiorari and mandamus.
[129] As well, the current law of liability for public authorities – the
provenance and essence of which is private law – sits as an anomaly within the
common law. By and large, our common law recognizes the differences between
private and public spheres and applies different rules to them. Private matters
are governed by private law and are addressed by private law remedies; public
matters are governed by public law and are addressed by public law remedies.
This has become a fundamental organizing principle: Dunsmuir, above; Canada (Attorney General) v. Mavi, 2011 SCC 30,
[2011] 2 S.C.R. 504; Air Canada v. Toronto Port
Authority, 2011 FCA 347; [2013] 3 F.C. 605.
[130] This anomaly should now end. The law of liability for public
authorities should be governed by principles on the public law side of the
divide, not the private law side. A number now seem to agree: see, e.g.,
United Kingdom Law Commission, Consultation Paper No. 187, Administrative
Redress: Public Bodies and the Citizen (London: The Law Commission, 2010);
Peter Cane, “Remedies Available in Judicial Review
Proceedings” in D. Feldman, ed. English Public Law (Oxford: Oxford University Press, 2004) 915 at page 949.
[131]
This idea is not so novel. In the past,
on multiple occasions, the Supreme Court has suggested public authorities could
be liable when they act “without legal justification,”
a concept that seems to echo public law principle, not private law torts: Conseil
des Ports Nationaux v. Langelier et al., [1969] S.C.R. 60 at page 75, 2
D.L.R. (3d) 81; Roman Corp. v. Hudson's Bay Oil & Gas Co., [1973]
S.C.R. 820 at page 831, 36 D.L.R. (3d) 413. And in two cases – one more than a
half century ago, the other a century ago – the Supreme Court awarded monetary
relief for improper public law decision-making on the basis of public law
principles existing at that time. In McGillivray v. Kimber (1915), 52
S.C.R. 146, 26 D.L.R. 164, the Supreme Court granted
monetary relief and, in so doing, did not invoke negligence principles
or any other nominate cause of action in private law.
And in Roncarelli, above, the Supreme Court (per Justice Rand at
page 142) granted monetary relief, relying not only on negligence (then article
1053 of the Civil Code of Québec) but also on “the principles of the underlying public law.”
[132] What are the principles of the underlying public law? Today, they
are found primarily in administrative law, in particular the law of judicial
review. Broadly speaking, we grant relief when a public authority acts
unacceptably or indefensibly in the administrative law sense and when, as a
matter of discretion, a remedy should be granted. These two components –
unacceptability or indefensibility in the administrative law sense and the
exercise of remedial discretion – supply a useful framework for analyzing when
monetary relief may be had in an action in public law against a public authority.
This framework explains the outcome in cases like Roncarelli and McGillivray,
both above, as well as negligence cases like Hill, Syl Apps, Fullowka,
all above, and others mentioned below.
[133] I turn now to the first part of this framework, unacceptability or
indefensibility in the administrative law sense.
[134] In Canada, public decisions, when judicially reviewed, are often
subject to reasonableness review. This means that the decision must be within a
range of acceptability or defensibility on the facts and the law: Dunsmuir,
above at paragraph 47. If the decision is within that range, it stands and the
Court does not proceed to any consideration of remedy. On the other hand, when
a decision is outside of the range, i.e., is unacceptable and
indefensible within the meaning of the authorities, we proceed to the remedial
stage of judicial review.
[135] The range of acceptability and defensibility in the administrative
law sense or, put another way, the margin of appreciation we afford to a public
authority, can be narrow or wide depending on the nature of the question and
the circumstances: Catalyst Paper Corp.
v. North Cowichan (District), 2012 SCC 2, [2012] 1 S.C.R. 5 at paragraphs 17-18 and 23;
Canada (Citizenship and Immigration) v. Khosa, 2009
SCC 12, [2009] 1 S.C.R. 339 at paragraph 59; McLean v. British
Columbia (Securities Commission), 2013 SCC 67, [2013] 3 S.C.R. 895 at
paragraphs 37-41; and see the guiding principles and non-exhaustive list of
factors that can affect the margin of appreciation in Canada (Minister of
Transport, Infrastructure and Communities) v. Farwaha, 2014 FCA 56, 455 N.R.
157 at paragraphs 90-99 and Pham v Secretary of State for the Home
Department, [2015] UKSC 19 at paragraph 107.
[136] On the one hand, where the decision is clear-cut or constrained by
judge-made law or clear statutory standards, the margin of appreciation is narrow:
see, e.g., McLean, above; Canada
(Attorney General) v. Abraham, 2012 FCA 266, 440 N.R. 201; Canada
(Attorney General) v. Almon Equipment Limited, 2010 FCA 193, [2011] 4 F.C. 203; Canada (Public Safety and
Emergency Preparedness) v. Huang, 2014 FCA 228, 464 N.R. 112. In such
cases, the Court is more likely to reach the remedial stage. On the other hand,
where the decision is suffused with subjective judgment calls, policy
considerations and regulatory experience or is a matter uniquely within the ken
of the executive, the margin of appreciation will be broader: see, e.g.,
Farwaha, above; Rotherham Metropolitan Borough Council v. Secretary
of State for Business Innovation and Skills, 2015 UKSC 6. In such cases,
the Court is less likely to reach the remedial stage.
[137] Indeed, where a decision is thoroughly suffused by facts, policies,
discretions, subjective appreciations and expertise, the margin of appreciation
may be so wide that, absent bad faith, it is hard to see how the remedial stage
could ever be reached: see, e.g., Catalyst, above; Katz Group
Canada Inc. v. Ontario (Health and Long Term Care), 2013 SCC 64, [2013] 3
S.C.R. 810; Rotherham, above. The rejection of certain claims for
negligent decision-making or conduct may well be explained in this way: see, e.g.,
Alberta v. Elder Advocates of Alberta Society, 2011 SCC 24, [2011] 2 S.C.R. 261; Enterprises
Sibeca Inc. v. Frelighsburg, 2004 SCC 61, [2004] 3 S.C.R. 304 at paragraphs
23 and 39; Williams v. Ontario, 2009 ONCA 378, 95 O.R. (3d) 401; Eliopoulos
Estate v. Ontario (Minister of Health and Long Term Care) (2006), 82 O.R. (3d) 321, 276 D.L.R. (4th) 411 (C.A.); A.L.
v. Ontario (Minister of Community and Social Services) (2006), 83 O.R. (3d)
512, 274 D.L.R. (4th) 431 (C.A.). Perhaps when the Supreme Court in Imperial
Tobacco speaks of core policy matters for which damages cannot be had,
these are the sorts of cases it has in mind. That concept, though, is best
understood using public law tools, not private law negligence.
[138] In an application for judicial review, remedies are discretionary: MiningWatch
Canada v. Canada (Fisheries and Oceans), 2010 SCC 2, [2010] 1 S.C.R. 6; Mobil
Oil Canada Ltd. v. Canada-Newfoundland Offshore Petroleum Board, [1994] 1
S.C.R. 202, 111 D.L.R. (4th) 1. Courts inform their remedial discretion by examining
the acceptability and defensibility of the decision, the circumstances
surrounding it, its effects, and the public law values that would be furthered
by the remedy in the particular practical circumstances of the case: D’Errico
v. Canada (Attorney General), 2014 FCA 95, 459
N.R. 167 at paragraphs 15-21; and see the enumeration of public law
values in Wilson v. Atomic Energy of Canada Limited, 2015 FCA 17 at
paragraph 30, citing Paul Daly, “Administrative Law: A
Values-Based Approach” in Mark Elliott and Jason Varuhas, eds., Process
and Substance in Public Law Adjudication (forthcoming, Hart: Oxford, 2015).
[139] This framework – the unacceptability or indefensibility in the
administrative law sense of the public authority’s conduct and the court’s
exercise of remedial discretion – should govern whether monetary relief in
public law may be had by way of action.
[140] Nothing in law obstructs this. In particular, the traditional rules of Crown immunity and the Crown Liability
and Proceedings Act, R.S.C. 1985, c C-50 and its predecessors have not
prevented the granting of monetary relief in public law in cases like Roncarelli and McGillivray, both
above. The jurisdiction of courts to grant
public law relief is rooted in their constitutionally-based administrative law
jurisdiction to relieve against improper public action: Crevier v. A.G. (Québec) et al., [1981] 2 S.C.R. 220, 127 D.L.R. (3d) 1. Were it
necessary to examine the Crown Liability
and Proceedings Act, in my view a public authority against whom monetary
relief is awarded on public law principles must be regarded as having committed
a “fault” (in
Quebec) or a “tort” (in
the rest of Canada) within the meaning of paragraphs 3(a)(i) and 3(b)(i)
of the Act. The word “tort” cannot be read as including only named torts in
private law such as negligence but instead must extend to any
legally-recognized fault, otherwise Quebec and the rest of Canada would have a different liability rule. Preventing different liability rules within Canada was the point of the amendments made to these provisions by the Federal
Law-Civil Law Harmonization Act, No. 1, S.C. 2001, c. 4.
[141] I wish to add more about the discretion to grant monetary relief in
public law.
[142] In public law, monetary relief has never been automatic upon a
finding that governmental action is invalid or, using modern, post-Dunsmuir
administrative law language, outside the range of acceptability or
defensibility: Welbridge Holdings Ltd. v. Greater Winnipeg, [1971]
S.C.R. 957, 22 D.L.R. (3d) 470; The Queen (Can.) v. Saskatchewan Wheat Pool,
[1983] 1 S.C.R. 205, 143 D.L.R. (3d) 9; Holland v. Saskatchewan, 2008
SCC 42, [2008] 2 S.C.R. 551 at paragraph 9. “Invalidity
is not the test of fault and it should not be the test of liability”:
K.C. Davis, Administrative Law Treatise (1958), vol. 3 (St. Paul, MN:
West Publishing, 1958) at page 487. There must be additional circumstances to
support an exercise of discretion in favour of monetary relief.
[143] The compensatory objective of monetary relief must be kept front of
mind. So, in some cases, the quashing of a decision or the enjoining or
prohibition of conduct will suffice and monetary relief will neither be
necessary nor appropriate. In other cases, quashing, prohibiting or enjoining
can prevent future harm and go some way to redress past harm, reducing or
eliminating the need for monetary relief. In still others, such as cases like McGillivray
and Roncarelli, both above, only monetary relief can accomplish the
compensatory objective.
[144] As well, the quality of the public authority’s conduct must be considered.
This is because orders for monetary relief are mandatory orders against public
authorities requiring them to compensate plaintiffs. And in public law,
mandatory orders can be made against public authorities only to fulfil a clear
duty, redress significant maladministration, or vindicate public law values:
see, e.g., Canada (Public Safety and Emergency Preparedness) v. LeBon,
2013 FCA 55, 444 N.R. 93 at paragraph 14; D’Errico, above at paragraphs
15-21.
[145] The decided cases seem to reflect this. It is striking how often
courts have awarded monetary relief against public authorities where they have
not fulfilled a clear and specific duty to act – i.e., where, using the language
of public law, the failure to act was unacceptable or indefensible in the
administrative law sense and there are circumstances of specific undertakings,
specific reliance or known vulnerability of specific persons that trigger or underscore
an affirmative duty to act: see Norman Siebrasse, “Liability
of Public Authorities and Duties of Affirmative Action” (2007), 57
U.N.B.L.J. 84 and cases citied therein. As for addressing maladministration or
vindicating public law values, it is striking how often it is said that monetary
recovery in some categories of cases requires abuses of power, exercises of bad
faith, pursuits of improper purposes, or conduct that is “clearly wrong,” “reckless,” “irrational,” “inexplicable and incomprehensible,” or a “fundamental breakdown of the orderly exercise of authority”:
see, e.g., Mackin v. New Brunswick (Minister of Finance); Rice v. New Brunswick, 2002 SCC 13, [2002] 1 S.C.R. 405 at paragraph 78; Finney v. Barreau
du Québec, 2004 SCC 36, [2004] 2 S.C.R. 17 at paragraph 39; Vancouver
(City) v. Ward, 2010 SCC 27, [2010] 2 S.C.R. 28 at paragraph 43; Enterprises
Sibeca Inc., above at paragraph 23; Imperial Tobacco, above at
paragraphs 74 and 90; see also the authorities cited in paragraph 87 of my
reasons, above; and see also the illuminating discussion in David Mullan, “Roncarelli v. Duplessis and Damages for Abuse of
Power”, (2010) 55 McGill L.J. 587 at pages 604-610. Maladministration
and conduct offensive to public law values can take many forms; these are just particular
illustrations.
[146] The considerations governing the discretion to award remedies in a
judicial review, set out in paragraph 138 of my reasons, above, apply equally
to the granting of monetary relief in public law. Among other things, one must
assess the circumstances surrounding the public authority’s conduct, its
effects, and whether the granting of monetary relief would be consistent with
public law values: see Wilson and Daly, both above; see also much of the
discussion in the Charter damages case of Ward, above. Concerns about
public authorities being saddled with indeterminate liability and being left
free, not chilled, from exercising their legislative mandates are
well-supported by some of these public law values. In appropriate cases, those
concerns must form part of the exercise of remedial discretion.
(4)
The case at bar
[147] My colleague suggests – and I agree – that had the beekeepers
attacked Canada’s conduct in this case by way of judicial review and had they
proven their allegations, they would have succeeded on the grounds set out in
paragraph 85 of my reasons, above. At least, that is how it appears from the
allegations in the statement of claim and proposed amended statement of claim
before the Court, allegations that we must take as true. Therefore, the
question before us is whether it is plain and obvious that a court would
exercise its discretion against giving the beekeepers monetary relief.
[148] It is not plain and obvious. Taking the allegations in the claim as
proven, Canada’s officials took it upon themselves to create and enforce an
unauthorized, scientifically unsupported blanket policy preventing the
beekeepers from exercising their legal right to apply for importation permits
on a case-by-case basis under section 160 of the Health of Animals
Regulations, above. This gives rise to a number of grounds for finding
unacceptability and indefensibility: see paragraph 85 of my reasons, above. As
alleged, Canada’s conduct has a flavour of maladministration associated with
it, something that can prompt an exercise of discretion in favour of monetary
relief. The additional element of bad faith, pleaded here (see paragraph 87 of
my reasons, above), buttresses that conclusion. As pleaded, the interactions
between Canada and the beekeepers suggest that monetary relief may be required
to fulfil a clear and specific duty to act. I also rely on much of the
discussion in paragraphs 98-101 of my reasons, above, concerning the absence of
a chilling effect on administrative decision-makers and indeterminate
liability.
[149] Canada pleads in its defence that monetary relief is
unavailable or should be denied. But for it to succeed on these points, evidence
will have to be adduced. On this motion to strike, no such evidence is before
us and so a number of issues do not yet arise for determination:
•
If the policy is declared
invalid, the Court will have to calculate damages based on what would happen in
the “but for” world. In that world, the beekeepers would have
been able to apply for importation permits under section 160. The Minister
would have had a broad margin of appreciation under that section, based on
facts, policy and the need to protect against disease and other harm, indeed
likely one so broad that only bad faith would render a decision unreasonable.
For practical purposes, if it turns out that the Minister would have had
evidence at that time supporting a denial of the permits, then any decision to
refuse permits would be upheld as reasonable. This would eliminate any claim
for monetary relief.
•
Might the beekeepers have
mitigated almost all of their losses by bringing an application for judicial
review seeking to quash the policy as soon as it was enacted? In this motion to
strike, we have no evidence nor can we assume that the beekeepers could have brought
or would have been able to bring a judicial review right away. Even if that
were so and even if they were successful in quashing the policy, quashing alone
would not be an adequate remedy. Unaddressed would be the financial loss caused
by the policy from the time it was first enforced through to the time the Federal
Court, this Court or the Supreme Court quashed it – possibly a period of years.
•
Might there be benign,
scientifically-based explanations for the officials’ conduct and their creation
and enforcement of the policy?
[150] In its submissions before the Federal Court and to some extent in
this Court, Canada objects to the beekeepers’ claim based on civil procedure.
In my view, it is not plain and obvious that a civil procedure objection lies.
[151] Before us, Canada alluded to the beekeepers’ failure to bring an
application for judicial review attacking the policy, as has my colleague. But
the beekeepers could only seek monetary relief by way of action, not judicial
review, and that is how they have proceeded: Al-Mhamad v. Canada (Radio-Television and Telecommunications Commission), 2003 FCA 45, 120 A.C.W.S. (3d) 351. The statement of claim does not explicitly seek remedies
such as injunction, certiorari, prohibition, mandamus,
quo warranto and declaration that can only be
sought by way of judicial review: Federal Courts Act, R.S.C. 1985, c.
F-7, subsection 18(3). Accordingly, the extendable 30-day limitation period for
some of those remedies does not apply here: Ibid., subsection 18.1(2). Had the beekeepers wanted to seek both subsection 18(3)
relief against the decisions and damages for those decisions, they could have
done so following the procedure described in Hinton v. Canada (Minister of
Citizenship and Immigration), 2008 FCA 215, [2009] 1 F.C. 476 at paragraphs
45-50. But they did not. They seek only a monetary remedy and have properly
proceeded by way of action.
[152] Since we are dealing with an action, section 39 of the Federal
Courts Act, above supplies the applicable limitation period, though failure
to formally invalidate the decisions at an early stage can significantly reduce
the level of recovery depending on the state of the evidence before the Court (see
paragraph 149 of my reasons, above). In some circumstances, an action might be
considered a collateral attack against decisions made, though the Supreme Court
seems prepared in some undefined circumstances to relax the doctrine of
collateral attack in the case of actions against public authorities: Canada
(Attorney General) v. TeleZone Inc., 2010 SCC 62, [2010] 3 S.C.R. 585; and
see also, e.g., Roncarelli and Gershman, both above, both
successful suits for damages suffered as a result of invalid decision-making.
Finally, while Canada mentioned collateral attack briefly in argument in
response to this Court’s questioning, Canada has not asserted that objection by
way of motion and so we have not had the benefit of full argument on the
matter.
[153] Canada also expresses concerns about the degree of
particularity in the beekeepers’ statement of claim. It is well-established
that bald allegations of bad faith, misbehaviour or malice cannot stand. They
must be particularized to a certain extent: St. John's Port Authority v.
Adventure Tours Inc., 2011 FCA 198; 335 D.L.R.
(4th) 312; Merchant Law Group v. Canada Revenue Agency, 2010 FCA
184, 321 D.L.R. (4th) 301 at paragraphs 34-39. This essential requirement helps
to prevent fictional claims and weak claims destined to die. In this case,
however, Canada has filed a statement of defence and, in so doing, has waived
any objection it might have had. It is too late for Canada to complain about
the statement of claim. But if the beekeepers move to amend their statement of
claim, Canada remains free to oppose or otherwise react to the amendments on
any admissible ground.
C. Proposed
disposition
[154] For the foregoing reasons, I would allow the appeal, set aside the
judgment of the Federal Court and dismiss the motion to strike. Rule 334.39(1)
provides that “no costs may be awarded against any
party…to an appeal arising from a class proceeding” unless the
conditions in Rules 334.39(1)(a), (b) or (c) are present.
Those conditions are not present and so, as my colleague has also proposed, I would
make no order as to costs.
"David Stratas"
“I agree
M. Nadon J.A.”