Date: 20001027
Docket: T-1620-95
BETWEEN:
A. O. FARMS INC.
Plaintiff
- and -
HER MAJESTY THE QUEEN IN RIGHT OF CANADA
- and -
THE MINISTER OF AGRICULTURE
- and -
THE CANADIAN WHEAT BOARD
Defendants
REASONS FOR ORDER
delivered from the bench at Calgary, Alberta
on Thursday, October 26, 2000
HUGESSEN, J.:
[1] This is a motion by the defendant Crown for summary judgment dismissing the plaintiff's action. The action itself sounds in tort, and is therefore a private law remedy directed against public authorities namely the Government of Canada and the Canadian Wheat Board.
[2] The factual background to the action is the short-lived Continental Barley Market Policy which was announced by the government in the summer of 1993. Certain amendments to the Canadian Wheat Board Regulations came into force on the 1st of August, 1993 and they were struck down as ultra vires by Justice Rothstein1 of this Court on September 10th of the same year.
[3] Following the election in October of 1993 and the change of government which took place, the government abandoned an appeal of Mr. Justice Rothstein's judgment and subsequently the Regulations themselves were revoked.
[4] During the period from August 1 to September 10 that the Regulations were apparently in force, the plaintiff entered into a number of contracts for the sale of barley to American customers. After the Regulations were struck down, the plaintiff was only able to fulfill those contracts with difficulty and at greater cost to itself. Hence the claim for damages.
[5] The action itself has two main grounds: first, it is said that the government was negligent in carrying out the legislative changes. As Mr. Justice Rothstein indicated in giving this Court's judgment on September 10, 1993 the government could have done it properly but did not do so. The second ground is negligent misrepresentation. The plaintiff relied on press releases and other statements made by government to plan its course of action and those statements turned out not to be correct.
[6] Dealing with the first ground, it is my view that it is now well-established that no action can lie against the government for adopting legislation which is subsequently found to be ultra vires. The leading case is the decision of the Supreme Court of Canada in Welbridge2 and it has been followed in a number of cases, the most recent of which I believe is the case of Guimond3. Put briefly, for a legislature to legislate even beyond its powers is not a tort.
[7] In a very able argument the plaintiff's counsel attempts to circumvent this difficulty by arguing the well-known distinction between policy decisions and operational or business decisions. Only the former it is said are exempt. When the government engages in ordinary business activities as the Wheat Board clearly does, it does not enjoy any special status in tort law. As counsel argues it, the policy decision here was to adopt the continental market for barley while the operational decision was the decision to implement that policy by, as he put it, "tinkering with the Regulations".
[8] In my view, this distinction while attractive cannot be sustained. The decision to legislate and the decision how to legislate are in my view inseparable. For sound policy reasons, legislative decisions are not actionable in the same way as adjudicative decisions are not actionable. And the choice of what to do legislatively or adjudicatively and how to do it legislatively or adjudicatively are two sides of the same coin. To take a simple example in the adjudicative area, I may decide this case in a certain way and I may decide to give reasons off the bench, or to reserve the case and to give written reasons, or to give no reasons at all, and all of those are part of the same adjudicative process as the actual decision-making process. It is the same, in my view, with respect to the legislative process and the decision to proceed by way of amending the Regulations rather than in some other way is a part of the legislative decision itself and is therefore protected.
[9] Turning to the second ground, I think the same result must follow. First, I note that the plaintiff entered into its contracts on the basis of the published Regulations. For it to prove that it relied not on those Regulations but on the published Press Releases would, I think, be a daunting task. However, be that as it may, the first test of a claim for negligent misrepresentation is to ask whether it was reasonable for the plaintiff to rely on the representation that was made. Without wishing to sound unduly cynical, I would say that very few people today would consider that it was reasonable to rely on promises made by politicians especially in a pre-election period. But there is more. It is trite law to say that a representation is a statement made as to a past or present fact. A promise, in contrast to that, is an undertaking as to a future action. Absent fraud or bad faith (and the plaintiff has expressly abandoned its allegations of bad faith) a promise does not constitute the basis of an action in negligence. Since the pleaded statements here are all as to future conduct, they cannot be tortious.
[10] 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/Kamloops4 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.
[11] 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.
[12] 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.
[13] Accordingly, I conclude that the motion must succeed and an Order will go dismissing the action with costs.
"James K. Hugessen"
Judge
Ottawa, Ontario
October 27, 2000
__________________1 Saskatchewan Wheat Pool v. Canada (Attorney General), (File no. T-1962-93, September 10, 1993, unreported) (F.C.T.D.)
2 Welbridge Holdings Ltd. v. Metropolitan Corp. of Greater Winnipeg, [1971] S.C.R. 957
3 Guimond v. Québec, [1996] 3 S.C.R. 347
4 Anns v. Merton London Borough Council, [1978] A.C. 728, Kamloops (City of) v. Nielsen, [1984] 2 S.C.R. 2