CWB class action inches toward hearing

It’s been nearly six years since the Canadian Wheat Board was stripped of its assets and authority by the federal government.

But there’s still a few loose ends that need to be dealt with, according to lawyers representing prairie farmers.

Among those loose ends is a class action suit against the federal government, in which litigants — namely CWB permit book holders — are seeking damages estimated in the range of $160 million to $200 million.

Last week, lawyers representing prairie wheat and barley growers issued a statement suggesting they’re closer to recovering that money, thanks to a supportive ruling by the Manitoba Court of Queen’s Bench.

In that ruling, Court of Queen’s Bench Master Shayne Berthaudin ruled that Ottawa must answer to the litigants’ claim.

Ottawa had previously filed a motion to have the claim dismissed, but Berthaudin’s ruling sets aside the federal motion and clears the way for the next step in the process — a hearing to have the class action certified.

“It’s been a long process but …we are getting closer to the end,” said Stewart Wells, a Swift Current, Sask., farmer and class action litigant who also chairs a group called Friends of the Canadian Wheat Board (FCWB).

The Manitoba ruling means “we could have a certification hearing this fall and actual arguments in front of a judge … as early as the spring of 2019.

“But if the government … continues to drag their feet and delay everything as much as possible, it could be another two to three years,” before the case is settled.

The class action was launched on behalf of all prairie wheat and barley farmers who marketed grain through the CWB in the 2010-11 and 2011-12 crop years.

It lists Brookdale, Man., farmer Andrew Dennis as the representative plaintiff and is supported by FCWB.

The basis of the claim is that money generated through the sale of Western Canadian wheat and barley was illegally retained by the CWB after the organization’s farmer-led board of directors had been dismissed.

Claimants say $145 million that should have been returned to farmers in the form of final payments for grain was instead placed in a CWB contingency fund.

The claimants say another $5.9 million was taken from the contingency fund and was used to cover so-called CWB restructuring costs, which were supposed to be covered by the government of Canada.

The claim is also seeking punitive damages of $10 million and interest on money that rightfully belongs to Western Canadian farmers.

With the Manitoba ruling now in place, the case against the federal government has cleared another important hurdle and prairie grain farmers are one step closer to holding Ottawa accountable for what some have called “the Great Canadian Grain Robbery.”

“We think this is a pretty straightforward case now, because it’s strictly a breach of contract case,” said Wells.

“The farmers signed contracts to deliver grain to the wheat board, and the wheat board was governed by …(federal legislation), which said that all monies over and above (legitimate) expenses would be paid back to farmers.”

Wells acknowledged that Ottawa could throw another hurdle in front of class action litigants if it decides to appeal the Manitoba Queen’s Bench decision. But that is unlikely, he said.

Ottawa has 30 days to appeal the ruling, meaning an appeal must be filed before June 28.

Anders Bruun, a Winnipeg lawyer who is spearheading the class action, said CWB annual reports suggest that money directed to the CWB contingency fund exceeded the fund’s legislated limit of $60 million.

Litigants maintain that additional money placed in the contingency fund was used to “sweeten the pot” for companies that were interested in acquiring CWB assets in what the Conservative government called the “CWB commercialization” process.

The CWB was eventually acquired by the grain company Bunge and the Saudi Agricultural Land and Investment Company (SALIC), an entity controlled by the government of Saudi Arabia.

Together, Bunge and SALIC created G3 Global Grain Group and a Canadian subsidiary known as G3 Canada, which assumed CWB’s assets.

“The CWB’s annual reports … issued after the farmer elected directors were dismissed, show that farmers were short-changed by over $140 million,” said Bruun, who is representing class litigants along with Toronto lawyers Jordan Goldblatt and Louis Century.

“The CWB Act required that money to be paid to farmers as part of their final payments for those crop years.” 

In a previous court ruling, Western Canadian farmers were told they had no claim to tangible assets held by the CWB, which included a Winnipeg office building, hopper cars and two ships that were commissioned by the CWB’s farmer-led board of directors prior to the wheat board’s dissolution.

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