The Canadian Wheat Board is suing CP Rail for $45 million in damages to compensate farmers for poor grain hauling in the winter of 1996-97.
But officials from both sides say they are still willing to settle their dispute out of court.
“There is nothing to prevent us from talking,” said CP spokesperson Ian La Couvee. “Our position is that if we sit down together long enough and talk, we could reach an agreement.”
Wheat board spokesperson Deanna Allen said that even though the lawsuit has now been filed, the board remains ready to settle.
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“We’re still open to sitting down and talking and we do have a new chief executive officer so there may be attempts to try and find an out-of-court settlement,” she said.
The board filed its statement of claim in the Federal Court of Canada in Winnipeg Dec. 23. CP Rail is required to file a statement of defence by late January.
La Couvee said the railway was “extremely disappointed” that the board decided to go ahead with a lawsuit, which he said will be costly and time consuming for all sides.
CWB commissioner Richard Klassen said the board was also disappointed no settlement could be reached, which he said left it no choice but to turn to the courts.
“The favorable ruling from the Canadian Transportation Agency is the basis for our damages claim and, through this lawsuit, we intend to have farmers compensated for their losses,” he said in a news release.
La Couvee said that while CP would prefer an out-of-court settlement, it won’t back down in the face of the lawsuit.
“We are prepared to defend ourselves very strongly,” he said. “We repeat the fact that we did not discriminate against grain and we’ll take that stand to court.”
In September, the transport agency found CP Rail discriminated against grain being shipped to Vancouver in favor of other commodities like coal, while it recovered from the impact of severe winter weather.
That decision followed six weeks of public hearings. CN Rail had originally been named in the same complaint but negotiated a confidential settlement with the board.
The board is seeking $25 million in damages for specific costs and expenses, including (the figures are rounded off), net demurrage $10.6 million, vessel costs $1.1 million, deferred freight $791,000, late shipments penalties $606,000, reduced cash flow costs $2.2 million, increased carrying costs $4.1 million, increased foreign exchange costs $355,000, forgone sales $4.5 million and U.S. rail car penalty interest $29,000.
The board is also asking for an additional $20 million for future financial losses relating to loss of business, and injury to economic relations, good will and reputation.
CP officials say they have not seen any specific information to indicate that any foreign buyers are now refusing to buy from Canada because of the 1996-97 problems.
But Allen said there is no question that the board’s customer relations have suffered.
