Top 5 Civil Appeals From The Court Of Appeal (September 2012)

Taylor v. Canada (Attorney General), 2012 ONCA 479 (Doherty, Weiler, Laskin, Sharpe and Armstrong JJ.A.), July 6, 2012

On a special case brought directly to it under rule 22.03 of the Rules of Civil Procedure, the Court of Appeal again grappled with the knotty issue of when a government regulator owes a prima facie private law duty of care. The parties asked the court to address perceived inconsistencies arising from: Drady v. Canada (Minister of Health), 2008 ONCA 659, 300 D.L.R. (4th) 443, leave to appeal to S.C.C. refused, [2008] S.C.C.A. No. 492, Attis v. Canada (Minister of Health), 2008 ONCA 660, 93 O.R. (3d) 35, leave to appeal to S.C.C. refused, [2008] S.C.C.A. No. 491 and Sauer v. Canada (AG), 2007 ONCA 454, 225 O.A.C. 143, leave to appeal to S.C.C. refused, [2007] S.C.C.A. No. 454. The special case arose out of a motion to decertify a class action on the basis that it is plain and obvious that the statement of claim does not allege a reasonable cause of action. In the result, the court rejected Canada's position that this class action concerning temporomandibular (jaw) joint implants that were manufactured in the United States and sold in Canada is bound to fail.

The representative plaintiff, Taylor, alleged that Health Canada breached a private law duty of care in the exercise of its responsibilities under the Food and Drugs Act R.S.C. 1985, c. F-2to protect her and other class members from unsafe medical devices. The nub of the case is the allegation that Health Canada announced that it had issued a notice of compliance for the implants when, in fact, it had not done so.

In contrast to the claims against Health Canada in Drady and Attis, a five-judge panel, per Doherty J.A., held that it was not "plain and obvious" that the action could not succeed.

Doherty J.A. noted that where the courts have found a prima facie duty of care, the facts have demonstrated a connection between the plaintiff and the regulator that is distinct from and more direct than the relationship between the regulator and members of the public. Drady and Attis are consistent with this approach. However, the court's treatment of proximity in Sauer, which amounted to a simple reference to the regulator's public statements, is not consistent with the jurisprudence, particularly in light of the Supreme Court's later judgment in R. v. Imperial Tobacco Canada Limited, 2011 SCC 42, [2011] 3 S.C.R. 45. Thus, to establish proximity, Taylor cannot simply rely on public assurances by Health Canada that it was performing its statutory duties.

What distinguishes this case from Drady and Attis are the allegations that Health Canada had erroneously stated that it had issued a notice of compliance for the implants and then failed to correct this misrepresentation when it became aware of it. These allegations arguably describe "a relationship between Health Canada and the users of those implants that is different from the relationship that exists between Health Canada and consumers of medical devices at large."

It was at least arguable at this stage of the litigation that the misrepresentations, combined with the failure to correct them "in the face of knowledge of the serious and ongoing risk posed to a clearly definable and relatively small group of consumers" gave rise to a breach of a private law duty of care.

Association of Justice Counsel v. Canada (Attorney General), 2012 ONCA 530 (Sharpe, Armstrong, Pepall JJ.A.), August 7, 2012

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