The Court of Appeal was asked to decide whether the February 2012 decisions of Justice Riordan to allow Imperial Tobacco to expand its claim against the federal government, and to reject the government's request for dismissal of all the third party/action in warranty claims made against it by the three tobacco companies.
Getting the Court of Appeal to overturn a lower court decision is a two-step process - the usual first step is to convince one judge of the Appeal Court that an appeal is justified, the second is to convince a bench of three judges that the initial ruling was wrong. But just over three months ago, Justice Kasirer deferred the decision on the government's request for leave to appeal these decisions, and set an unusual mid-summer hearing for three of his colleagues to consider all issues together. So it was that the questions were the subject of a one-day hearing before Justices Jacques Léger, Jacques Fournier and Clément Gascon.
Belt and suspenders: two legal principles to support the federal position.
Within my circles, the case for the federal government is considered very strong. The Supreme Court, after all, unanimously determined a year ago that that it was "plain and obvious" that similar claims by the tobacco companies in two B.C. cases had "no reasonable chance of success and should be struck out." Core government policy decisions, the Court confirmed, are shielded from lawsuits. Moreover, it said, the floodgates of such "indeterminate liability" against the government should be kept closed. With the same industry claimants, the same government defendants and the same government-industry interactions involved, the issue has already been decided, the government and its supporters say. It is a chose jugée!
To add to this belt of legal doctrine the suspenders of a second legal principle are attached - the doctrine of precedent. Because the Supreme Court unanimously sided with the government in this chose jugée, and because such decisions are binding on all lower courts, it is thought inevitable that the Quebec Court of Appeal will come to the same conclusion. This is what the New Brunswick Court of Queens Bench decided last February when it struck out similar third party claims by the same companies against the same government over the same issues.
These two issues were the core of the federal government case presented confidently during the morning session by counsels Nathalie Drouin and Maurice Régnier. Their presentations detailed the many ways in which the actions in warranty were identical to the third party claims that had been considered and struck out by the Supreme Court and the many reasons why the Court should make exceptions to the general rule of not allowing appeals of such rulings when a trial is ongoing. The amended claim of Imperial Tobacco was dissected and presented an unacceptable attempt to slide past the Supreme Court decision.
(When available, the written arguments of the federal government and industry will be posted here).
Hoist on its own petard?
Despite the safe money being on the federal side, the tobacco company representatives (Suzanne Coté and Craig Lockwood for Imperial Tobacco, Simon Potter for Rothmans Benson and Hedges and Doug Mitchell for JTI-Macdonald) offered the judges a variety of reasons to refuse to consider the appeal and to uphold Justice Riordan's decision.
During their afternoon's presentations, they took several swings at the strategy of the federal government leading up to the trial, especially its decision of postponing any attempt to get out of the Quebec case until the BC issues were resolved. (A few weeks before the Supreme Court issued its decision, the federal government reached an out of court arrangement with the plaintiffs - it too was rejected by Justice Riordan.)
Simon Potter painted a picture of a recalcitrant government, resisting Judge Riordan's appeals to bring forward its motion to be dismissed from the case. He cited Judge Riordan's frustrated comments in his February ruling that although he had "beseeched Canada to present its Motion to Dismiss in time so that these files could follow what appeared to be an inevitable path to the Supreme Court of Canada hand in hand with the BC proceedings. The Court's urgings fell on deaf ears." Potter pointed out that in a ruling as early as 2008, Justice Riordan had pushed the federal government to fish or cut bait. The outcome was a decision of Justice Riordan to postpone a final decision on the federal involvement, a case management decision the Court of Appeal should respect, he concluded.
Craig Lockwood took swipes at other actions of the government, in particular its continued engagement in licensing 'lower tar' varieties of tobacco after evidence of compensation had been shared with them. The industry should be permitted to show that these actions were wilful and reckless, he said, and therefore the federal government should remain in the case.
The B.C. (and New Brunswick) cases should not be considered precedents, the industry argued, as they were decided on laws quite different than those in Quebec. Because the Supreme Court ruling was on the statutes in those provinces and not on common law or other principles, the ruling did not automatically apply to Quebec's differing laws. In support of this position, they emphasized the logic of Judge Riordan's ruling that another Supreme Court ruling (on the Canadian Food Inspection Agency) was more relevant as it reflected the constitutionality of different proceedings in different jurisdictions. The distinctiveness of Quebec's legal system was repeatedly emphasized by the industry's representatives.
To date, the Court of Appeal has turned down almost all of the appeals sent its way in this case, and concerns about allowing any appeals of decisions made while the trial was under way were reflected in some of the comments from the bench. Justice Leger pointed out that Justice Riordan would have taken the Supreme Court decisions into account before making his decisions. Justice Gascon reflected on the slippery slope of allowing appeals of interlocutory judgements.
A BIG decision
In this case, the Court of Appeal will have to decide whether to draw a line between the Quebec class action and the B.C. and New Brunswick case s and, if so, on which side of that line the federal government’s future involvement lies.
It is not only the federal government and industry that have a lot riding on the outcome of this hearing. If the government is excused from the case, valuable experience and expertise sympathetic to the plaintiffs' side will leave the room. Testimony by the government's expert witnesses, which support the plaintiff's case, will not be available. The imbalance between the resources of four local law firms and those of three of the world's largest multinationals may become more important.
The Canadian public also stands to lose a unique opportunity for a judicial review, however strangely constructed, of the government's handling of a one of Canada's most sustained and deadly epidemics.