Class Action Certified Against Federal Government As Farmers Seek Damages Arising From 'Mad Cow' Crisis
On September 3, 2008, Madame Justice Joan Lax of the Ontario
Superior Court certified a $10 billion class proceeding brought on
behalf of 115,000 Canadian cattle farmers (excluding those in
Quebec) against the Government of Canada.
The class action was commenced in April 2005 and seeks damages for
economic losses arising from the 2003 closure of international
borders to Canadian cattle and beef products (including a 26-month
ban from the U.S.) immediately following the diagnosis of bovine
spongiform encephalopathy (BSE) or "mad cow disease" in
an Alberta cow. The claim alleges that the Government was negligent
in its regulation of the Canadian cattle industry. In particular,
it alleges that a government monitoring program failed to prevent
potentially infected imported cows from entering the food chain in
Canada. Ridley Inc., a Canadian animal feed manufacturer, and its
Australian parent, were also named as defendants and were alleged
to have been negligent in using ruminant meat and bone meal as a
feed ingredient, notwithstanding the known risk of BSE transmission
associated with such use.1
As against the Government, Justice Lax found that the proposed
class action satisfied all five required elements of the test for
certification.
Justice Lax dealt swiftly with the first prong of the
certification test, finding that the proposed class action
discloses a cause of action. The "plain and obvious" test
used in such a determination is the same test courts use on a Rule
21 motion to strike a claim for failure to disclose a cause of
action. Since the negligence claims against the Government were
previously the subject of a Rule 21 motion, in which both the
Ontario Superior Court and the Court of Appeal refused to strike
those allegations, and the Supreme Court of Canada refused leave to
appeal2. Justice Lax found that the existence of a cause
of action had already been conclusively determined in favour of the
plaintiff.
Justice Lax also agreed with the plaintiff that the class
definition of "cattle farmers" constitutes an
"identifiable class" based on objective criteria under
the second prong of the test. She disagreed with the
Government's argument that the class definition is subjective,
unworkable and leaves "a whole host of questions
unanswered." Although it was clear from the evidence that
there are a myriad of ways one could be involved in cattle farming,
she found that all of the potential class members share a common
defining...
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