Mancuso et al. v. Canada (Minister of National Health) et al., (2015) 476 N.R. 219 (FCA)

• Judge: Stratas, Rennie and Gleason, JJ.A.
• Court: Federal Court of Appeal (Canada)
• Case Date: September 09, 2015
• Jurisdiction: Canada (Federal)
• Citations: (2015), 476 N.R. 219 (FCA);2015 FCA 227

Mancuso v. Can. (2015), 476 N.R. 219 (FCA)

MLB headnote and full text

Temp. Cite: [2015] N.R. TBEd. OC.018

Nick Mancuso, The Results Company Inc., David Rowland, Life Choice Ltd. (amalgamated from, rolled into, and continuing on business for, and from, E.D. Modern Design Ltd. and E.G.D. Modern Design Ltd.) and Dr. Eldon Dahl, and Agnesa Dahl (appellants) v. Minister of National Health and Welfare, Attorney General of Canada, Minister of Public Safety and Emergency Preparedness, Royal Canadian Mounted Police, and Her Majesty the Queen in Right of Canada (respondents)

(A-365-14; 2015 FCA 227)

Indexed As: Mancuso et al. v. Canada (Minister of National Health) et al.

Federal Court of Appeal

Stratas, Rennie and Gleason, JJ.A.

October 27, 2015.

Summary:

The plaintiffs commenced an action challenging the constitutional authority of Parliament to enact a scheme for the regulation of the production and sale of natural health products. In the alternative, they challenged the statutory authority that authorized the regulations, and pleaded various Charter violations and tortious conduct by government officials in the administration and enforcement of the scheme. The plaintiffs sought declarations of invalidity and a stay of the enforcement of the legislation and regulations. The defendants moved to strike the Statement of Claim, relying on Federal Courts Rules 221(1)(a), (c), (d) and (f).

The Federal Court, in a decision reported at 460 F.T.R. 25, granted the motion to strike. The plaintiffs appealed.

The Federal Court of Appeal dismissed the appeal.

Civil Rights - Topic 8305

Canadian Charter of Rights and Freedoms - General - Application - Persons protected - Corporations - The plaintiffs pleaded various Charter violations and tortious conduct by government officials in the administration and enforcement of the scheme for the regulation of the production and sale of natural health products - The Federal Court of Appeal held that the judge correctly struck the claims of Charter violations advanced by the corporate plaintiffs - "A corporation cannot maintain a section 7 Charter challenge for either a subsection 24(1) or a section 52 remedy unless it is the defendant in a criminal or regulatory prosecution or is subject to compulsory measures, such as injunctive relief, at the behest of the state in a regulatory proceeding ... . The pleadings on behalf of the corporate defendants also suffer from the same deficiency found by the judge in respect of the individual plaintiffs. The claims by the corporate plaintiffs for breaches of the 'right to equality as a structural imperative of the underlying principle of the Constitution Act 1867', and for violations of the corporations' subsection 2(b) rights, lacked a factual foundation in the pleadings. In any event, a corporation cannot assert section 15 rights." - See paragraph 25.

Civil Rights - Topic 8375

Canadian Charter of Rights and Freedoms - Denial of rights - Remedies - Damages - The plaintiffs challenged the constitutional authority of Parliament to enact a scheme for the regulation of the production and sale of natural health products - In the alternative, they challenged the statutory authority that authorized the regulations, and pleaded various Charter violations and tortious conduct by government officials in the administration and enforcement of the scheme - They sought damages for lost profits, loss of reputation, mental distress, punitive and exemplary damages, as well as damages under s. 24(1) of the Charter - The plaintiffs appealed the order striking the statement of claim - The Federal Court of Appeal, in dismissing the appeal, held that the judge correctly dismissed the claim for relief - "As a general rule, damages are not available from harm arising from the application of a law which is subsequently found to be unconstitutional, without more. The plaintiffs pleaded that the respondents' conduct was 'clearly wrong, in bad faith or an abuse of power' - one of the elements typically required in order to found a damages claim under section 24(1) of the Charter - but failed to supply material facts on the question of how the Regulations and their enforcement constitute serious error, bad faith or abuse so as to trigger an entitlement to Charter damages. They also fail to give any particulars of any conduct that would support a damages claim." - See paragraph 29.

Civil Rights - Topic 8586

Charter - Practice - Method of raising Charter issues - Requirement of establishing a factual foundation - [See first Courts - Topic 4043 and third Practice - Topic 1300 ].

Constitutional Law - Topic 5676

Federal jurisdiction (s. 91) - Regulation of trade and commerce - Food and drug legislation - [See first Courts - Topic 4043 ].

Constitutional Law - Topic 9952

Practice - Pleadings - [See first Courts - Topic 4043 ].

Courts - Topic 4043

Federal Court of Canada - Jurisdiction - Federal Court - Declaratory relief - The plaintiffs sought declarations of invalidity as to the constitutionality of the Natural Health Products Regulations, either under the Charter or the Constitution Act, 1867 - They appealed the order striking the entire statement of claim - The Federal Court of Appeal addressed the plaintiff's argument that free-standing declarations of constitutionality could be granted - "[T]he right to the remedy does not translate into licence to circumvent the rules of pleading. Even pure declarations of constitutional validity require sufficient material facts to be pleaded in support of the claim. Charter questions cannot be decided in a factual vacuum ... nor can questions as to legislative competence under the Constitution Act, 1867 be decided without an adequate factual grounding, which must be set out in the statement of claim. This is particularly so when the effects of the impugned legislation are the subject of the attack" - See paragraphs 30 to 32.

Courts - Topic 4043

Federal Court of Canada - Jurisdiction - Federal Court - Declaratory relief - The plaintiffs brought an action challenging the Natural Health Products Regulations on constitutional grounds - They sought declaratory relief - The motion judge struck the entire statement of claim, including the paragraphs said to underlie the claims of constitutional breaches - The Federal Court of Appeal, in dismissing the appeal, stated that "[a] court must have a sense of a law's reach in order to assess whether and by how much that reach exceeds the legislature's vires. It cannot evaluate whether Parliament has exceeded the ambit of its legislative competence and had more than an incidental effect on matters reserved to the provinces without examining what its legislation actually does. Facts are necessary to define the contours of legislative and constitutional competence. In the present case, this danger is particularly acute; as the judge noted, the legislation at issue pertains to literally thousands of natural health supplements." - See paragraph 34.

Practice - Topic 1300

Pleadings - General principles - Stating material facts - The Federal Court of Appeal stated that "[i]t is fundamental to the trial process that a plaintiff plead material facts in sufficient detail to support the claim and relief sought. ... . The latter part of this requirement - sufficient material facts - is the foundation of a proper pleading. If a court allowed parties to plead bald allegations of fact, or mere conclusory statements of law, the pleadings would fail to perform their role in identifying the issues. The proper pleading of a statement of claim is necessary for a defendant to prepare a statement of defence. Material facts frame the discovery process and allow counsel to advise their clients, to prepare their case and to map a trial strategy. Importantly, the pleadings establish the parameters of relevancy of evidence at discovery and trial. ... [I]t is the responsibility of a motions judge, looking at the pleadings as a whole, to ensure that the pleadings define the issues with sufficient precision to make the pre-trial and trial proceedings both manageable and fair." - See paragraphs 16 to 18.

Practice - Topic 1300

Pleadings - General principles - Stating material facts - The plaintiffs appealed the order striking the statement of claim - The Federal Court of Appeal, in discussing the requirement of adequate material facts to be pleaded, stated that "[w]hat constitutes a material fact is determined in light of the cause of action and the damages sought to be recovered. The plaintiff must plead, in summary form but with sufficient detail, the constituent elements of each cause of action or legal ground raised. The pleading must tell the defendant who, when, where, how and what gave rise to its liability. ... Plaintiffs cannot file inadequate pleadings and rely on a defendant to request particulars, nor can they supplement insufficient pleadings to make them sufficient through particulars" - See paragraphs 19 and 20.

Practice - Topic 1300

Pleadings - General principles - Stating material facts - The plaintiffs pleaded that the Natural Health Products Regulations violated the Charter provisions raised - The Federal Court granted the defendants' motion to strike the claims - The plaintiffs did not identify any specific natural health product to which they had been denied access, nor how that denial related to the rights might be protected by the Charter provisions - The plaintiffs appealed - The Federal Court of Appeal held that the motion judge correctly struck the claims - "There are no separate rules of pleadings for Charter cases. The requirement of material facts applies to pleadings of Charter infringement as it does to causes of action rooted in the common law. The Supreme Court of Canada has defined in the case law the substantive content of each Charter right, and a plaintiff must plead sufficient material facts to satisfy the criteria applicable to the provision in question. This is no mere technicality" - See paragraph 21.

Practice - Topic 1302

Pleadings - General principles - Purpose of pleadings - [See first Practice - Topic 1300 ].

Practice - Topic 1311

Pleadings - Questions of law - Pleading the Charter - [See third Practice - Topic 1300 ].

Practice - Topic 1462

Pleadings - Statement of claim - General - Requirement of stating basis for claim - [See first Practice - Topic 1300 ].

Practice - Topic 1466

Pleadings - Statement of claim - General - Omission of essential facts - Effect of - [See first Courts - Topic 4043 ].

Practice - Topic 2230.3

Pleadings - Striking out pleadings - Grounds - Failure to plead material facts - [See first Practice - Topic 1300 ].

Practice - Topic 2239

Pleadings - Striking out pleadings - Grounds - Abuse of process or delay - The Federal Court of Appeal addressed the question of whether it was appropriate to strike a claim on the basis that it was an abuse of process on a motion to strike - "[T]he rules of practice of the Federal Courts expressly contemplate this (Rule 221(f)). Further, this Court has endorsed the propriety of striking a claim as being an abuse of process at the pleadings stage where the claimant sought to relitigate a criminal conviction from another jurisdiction in a civil action before the Federal Court ... Whether a particular issue has previously been judicially determined is a fact of which a judge is entitled to take notice at the early stage of a motion to strike. ... Allowing the abuse of process doctrine to be raised at the pleadings stage is consistent with the objective of maintaining respect for the administration of justice and the court's desire for comity and mutual respect between jurisdictions. More practically, a defendant has the right to have an abusive claim struck before being subjected to an intrusive and costly discovery process. ... [I]t is not unduly burdensome to expect plaintiffs who know they are relitigating a previously-determined issue to include in their pleadings the material facts they will rely upon to explain why the discretion to find the claim abusive should not be exercised." - See paragraphs 42 and 43.

Practice - Topic 2239.4

Pleadings - Striking out pleadings - Grounds - Abuse of process - Collateral attack - The plaintiffs pleaded various Charter violations and tortious conduct by the defendant government officials in the administration and enforcement of the Natural Health Products Regulations - The defendants objected to the claim that searches conducted by officers of the defendant against some of the plaintiffs violated s. 8 of the Charter - The motion judge struck those allegations on the basis that they had previously been raised and disposed of in the criminal and regulatory prosecutions - He found that the s. 8 Charter claim constituted a collateral attack on the Provincial Court and Queen's Bench decisions and also an abuse of process - The Federal Court of Appeal held that while the judge erred in characterising the claim as a collateral attack, he correctly identified it as an abuse of process - "Here, damages are sought for an alleged unconstitutional search and for torts claimed to have been committed in the execution of the search. In the provincial courts, what was sought was the exclusion of the evidence obtained in the search at a criminal trial. These differences preclude the application of the doctrine of collateral attack. Abuse of process, however, remains available; indeed ... abuse of process explicitly contemplates a different judicial forum and relief sought." - See paragraphs 37 to 41.

Practice - Topic 2240.1

Pleadings - Striking out pleadings - Grounds - Claim based on statute alleged to be ultra vires - [See first Courts - Topic 4043 ].

Practice - Topic 8825.7

Appeals - General principles - Duty of appeal court from decision of motions judge on striking pleadings - The Federal Court of Appeal confirmed the standard of review applicable to decisions of a trial judge in matters of pleadings - See paragraph 8.

Torts - Topic 9944

Evidence and proof - Proof - Pleading - The plaintiffs pleaded that in the implementation and enforcement of the scheme for the regulation of the production and sale of natural health products (Natural Health Products Regulations), agents and officials of the defendants committed torts related to the exercise of state authority, including malicious prosecution and misfeasance in a public office - The motion judge struck the claim - The Federal Court of Appeal, in dismissing the appeal, stated that "[a] properly pleaded tort claim identifies the particular nominate tort alleged and sets out the material facts needed to satisfy the elements of that tort. ... The bald assertion of a conclusion is not a pleading of material fact. The judge properly struck many of the paragraphs underlying the tort claims on the basis that without more, these were conclusory statements. ... The judge assessed the allegations of tortious conduct in the implementation and enforcement of the Regulations against these principles and concluded that the appropriateness of the enforcement measures could only be assessed in the light of the facts and context of a particular action or series of actions. What was pleaded, however, was a general practice, with no specific instances" - See paragraphs 26 to 28.

Cases Noticed:

Decor Grates Inc. v. Imperial Manufacturing Group Inc. et al. (2015), 472 N.R. 109; 2015 FCA 100, refd to. [para. 8].

AstraZeneca Canada Inc. et al. v. Novopharm Ltd. (2010), 402 N.R. 95; 2010 FCA 112, refd to. [para. 20].

MacKay et al. v. Manitoba, [1989] 2 S.C.R. 357; 99 N.R. 116; 61 Man.R.(2d) 270, refd to. [para. 21].

Syndicat Northcrest v. Amselem et al., [2004] 2 S.C.R. 551; 323 N.R. 59; 2004 SCC 47, refd to. [para. 22].

Reference Re Section 94(2) of the Motor Vehicle Act (B.C.), [1985] 2 S.C.R. 486; 63 N.R. 266, refd to. [para. 23].

R. v. Morgentaler, Smoling and Scott, [1988] 1 S.C.R. 30; 82 N.R. 1; 26 O.A.C. 1, refd to. [para. 23].

Withler v. Canada (Attorney General), [2011] 1 S.C.R. 396; 412 N.R. 149; 300 B.C.A.C. 120; 509 W.A.C. 120; 2011 SCC 12, refd to. [para. 24].

R. v. Big M Drug Mart Ltd., [1985] 1 S.C.R. 295; 58 N.R. 81; 60 A.R. 161, refd to. [para. 25].

Canadian Egg Marketing Agency v. Pineview Poultry Products Ltd. et al., [1998] 3 S.C.R. 157; 231 N.R. 201; 223 A.R. 201; 183 W.A.C. 201, refd to. [para. 25].

Canadian Egg Marketing Agency v. Richardson - see Canadian Egg Marketing Agency v. Pineview Poultry Products et al.

Odhavji Estate et al. v. Woodhouse et al. (2003), 312 N.R. 305; 180 O.A.C. 201; 2003 SCC 69, refd to. [para. 26].

Adventure Tours Inc. v. St. John's Port Authority (2011), 420 N.R. 149; 2011 FCA 198, refd to. [para. 26].

Merchant Law Group et al. v. Canada Revenue Agency et al. (2010), 405 N.R. 160; 2010 FCA 184, refd to. [para. 26].

Rice, P.C.J. v. New Brunswick, [2002] 1 S.C.R. 405; 282 N.R. 201; 245 N.B.R.(2d) 299; 636 A.P.R. 299; 2002 SCC 13, refd to. [para. 29].

Mackin v. New Brunswick (Minister of Finance) - see Rice, P.C.J. v. New Brunswick.

Ward v. Vancouver (City) et al., [2010] 2 S.C.R. 28; 404 N.R. 1; 290 B.C.A.C. 222; 491 W.A.C. 222; 2010 SCC 27, refd to. [para. 29].

Henry v. British Columbia (Attorney General) et al. (2015), 470 N.R. 200; 369 B.C.A.C. 47; 634 W.A.C. 47; 2015 SCC 24, refd to. [para. 29].

Canadian Transit Co. v. Windsor (City) (2015), 472 N.R. 361; 2015 FCA 88, refd to. [para. 32].

Danson v. Ontario (Attorney General), [1990] 2 S.C.R. 1086; 112 N.R. 362; 41 O.A.C. 250, refd to. [para.32].

Khadr v. Prime Minister (Can.) et al., [2010] 1 S.C.R. 44; 397 N.R. 294; 2010 SCC 3, refd to. [para. 33].

Daniels et al. v. Canada (Minister of Indian Affairs and Northern Development) et al. (2014), 457 N.R. 347; 2014 FCA 101, refd to. [para. 34].

Solosky v. Canada, [1980] 1 S.C.R. 821; 30 N.R. 380, refd to. [para. 35].

R. v. Dahl (E.G.) et al. (2013), 555 A.R. 201; 2013 ABQB 54, refd to. [para. 37].

Toronto (City) v. Canadian Union of Public Employees, Local 79 et al., [2003] 3 S.C.R. 77; 311 N.R. 201; 179 O.A.C. 291; 2003 SCC 63, refd to. [para. 39].

Sauve v. Royal Canadian Mounted Police et al. (2011), 420 N.R. 79; 2011 FCA 141, refd to. [para. 42].

Statutes Noticed:

Federal Courts Rules, SOR/98-106, rule 174 [para. 20]; rule 221(f) [para. 42].

Food and Drugs Act, R.S.C. 1985, c. F-27, generally [para. 4].

Food and Drugs Act Regulations (Can.), Natural Health Products Regulations, SOR/2003-196, generally [para. 4].

Food and Drug Regulations - see Food and Drugs Act Regulations (Can.).

Counsel:

Rocco Galati, for the appellant;

Sean Gaudet and Andrew Law, for the respondent.

Solicitors of Record:

Law Firm Professional Corporation, Toronto, Ontario, for the appellant;

William F. Pentney, Deputy Attorney General of Canada, Toronto, Ontario, for the respondent.

This appeal and cross-appeal were heard at Toronto, Ontario, on September 9, 2015, before Stratas, Rennie and Gleason, JJ.A., of the Federal Court of Appeal. In reasons written by Rennie, J.A., the Court delivered the following judgment, dated October 27, 2015, at Ottawa, Ontario.