Farmers seeking federal compensation for loss of the Canadian Wheat Board’s assets are considering whether to appeal a Federal Court ruling rejecting their lawsuit or follow the judge’s instructions to launch a different claim.
Justice Tremblay-Lamer, in a written ruling rendered Nov. 29, dismissed six of the seven claims found in a $17.06-billion class-aaction lawsuit launched by four western Canadian farmers in February 2012, with the Friends of the Candian Wheat Board’s (FCWB) backing.
But Tremblay-Lamer ruled the plaintiff farmers — Harold Bell of Fort St. John, B.C., Andrew Dennis of Brookdale, Man., Nathan Macklin of DeBolt, Alta., and Ian McCreary of Bladworth, Sask., — could still sue the government based on their allegations it mismanaged farmer money by using it to help the board become the CWB.
The transition began in late 2011 with the passing of the Marketing Freedom for Grain Farmers Act, which eliminated the wheat’s sales monopoly Aug. 1, 2012.
Tremblay-Lamer wrote government lawyers presented “no arguments… to demonstrate that the claims are untrue or could not succeed at trial.” She directed the farmers and their lawyers to “serve and file a revised statement of claim consistent with these reasons.”
Stewart Wells, a former wheat board director and chair of the FCWB said the farmers are considering whether to appeal. If they do, they will emphasize that since almost all the money earned by the wheat board came from the sale of farmers’ grain, farmers have a right to the wheat board’s assets.
“This is the legislated theft of farm-paid assets,” he said of the ruling.
“The minister (of agriculture Gerry Ritz) might think this suit is frivolous and gloat but farmers know who paid for those assets and who were disenfranchised when they weren’t allowed to vote (on the future of the wheat board).”
“These assets exist now and the government has in effect taken them for Mr. Ritz’s grain company,” said Anders Bruun, one of the lawyers representing the farmers. “It’s not as if people are chasing after some imaginary gain. They’re looking for the recovery of the real assets that they paid for.”
They include money in the wheat board’s contingency fund as well as the board’s Winnipeg office building, rail cars and two new lake ships.
aBy law, the CWB must either privatize or wind down operations. CWB management is working towards the former. Wells fears the wheat board’s assets will end up enriching a merger partner or buyer.
“Justice is currently not being served by this narrow, legal definition,” he said.
Had something similar occurred to an American or Mexican grain company operating in Canada, its owners would be entitled compensation under terms of the North American Free Trade Agreement, Wells said. There’s something wrong when foreign multinationals can get better treatment than Canadian farmers, he added.
The federal government cannot take private property without compensating the owner unless a statute clearly provides otherwise, Tremblay-Lamer wrote. But the farmers did not establish “a de facto taking” that would involve compensation, she added.
Since an earlier court case determined the government acted lawfully in ending the board’s monopoly… “there has been no deprivation of property.”
Tremblay-Lamer’s ruling also shot down the farmers’ claim of a “breach of trust” by the federal government. The government’s previous regulation of the grain sector, she wrote, could not be taken to imply a fiduciary duty to Prairie grain farmers.
The government, she wrote, is “balancing competing interests” in regulating grain and noted there were farmers in favour and opposed to an open market.
Agriculture Minister Gerry Ritz was pleased with the decision. “Our government is pleased with this decision that underscored the right of western Canadian wheat and barley farmers to market their own grain,” Ritz said in a release. “While 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.”
The lawsuit was not frivolous, nor did the courts find it so, Bruun said.
“It’s surprising to me the minister is as cocky as he is,” he said, noting that many farmers who supported an open market agree the board’s assets belong to farmers.
“These are real assets worth real money and they’ve been paid for by farmers and Ritz is calling their request for repayment of that money frivolous? That’s too much.”