Court rejects most of CWB class action suit

If a Federal Court judgment holds, a $17 billion class action suit against Ottawa over ending the CWB monopoly would be reduced to a potential claim worth a fraction of that.


As CWB supporters consider an appeal, a Federal Court of Canada judge has rejected most of their arguments.


A lawyer for Friends of the Canadian Wheat Board said the judgment still leaves open continuation of a legal claim but the stakes would be significantly lower.


“I think the judgment leaves open continuation of the case and we could be looking at several hundred millions of dollars in those claims,” Winnipeg lawyer Anders Bruun said in a Dec. 16 interview. 


“There certainly are grounds to move ahead. The farmers involved have until late December to appeal the broader judgment.”


In the name of four prairie farmers, FCWB launched the class action suit against the federal Conservative government for its 2011 decision to end the single desk.


They claimed the government confiscated billions of dollars in farmer assets and future revenues, claiming the CWB as farmer owned.


Justice Daniele Tremblay-Lamer, who heard the case in Ottawa several months ago, ruled last week and rejected most of the farmer claims of confiscated property.


“It is clear that there has been no transfer of property interest and therefore there can be no confiscation,” she wrote. 


“The (legislation) does not divest the plaintiffs of property nor does it divest the CWB of its property since the CWB is continued and it continues to own the contingency fund along with its other assets.”


She ruled that farmers were never “shareholders in the CWB but rather were entitled to payment under the CWB Act for grain sold through the CWB.”


Several times, Tremblay-Lamer argued, “there has been no deprivation of property.”


However, she ruled that the government may have deprived farmers of some pool payouts during the 2011-12-transition year and may not have established “a reasonable price for grain remaining unsold after the 2011-12 pool period.”


On that basis, she said a limited class action suit should be allowed to continue. The federal government declared victory.


“While the courts continue to strike down these frivolous lawsuits, the fact remains that the overwhelming majority of western grain farmers have embraced marketing freedom and are capitalizing on new economic opportunities that were impossible under the old single desk,” agriculture minister Gerry Ritz said in a statement.


Stewart Wells, former National Farmers Union president and chair of the FCWB group, said in a statement that the court ruling was a “mixed message” and an appeal is being considered. 


“This is one of those times when justice and the law are complete strangers.”


Bruun said the $17 billion class action claim was based on high grain prices last year when the suit was filed and the assumption of the value of those prices into the future.


He said with prices now dropping, the value would be less.


And any challenge of the court ruling would be based on “innovative” concepts of property rights in the law.


“There is not a lot of precedent in law for our arguments about property rights and the CWB but the legal definition of property rights is expanding,” he said. 


“The question is what are the legal rights of producers in that property definition. The notion of Mr. Ritz calling our suit frivolous is not realistic.”


He said the judgment opens the door to a continuation of the suit against Ottawa, albeit for smaller stakes. 


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