Sauer v. Canada (Attorney General),

• Jurisdiction: Ontario
• Judge: Catzman*, Goudge and LaForme, JJ.A.
• Neutral Citation: 2007 ONCA 454
• Citation: (2007), 225 O.A.C. 143 (CA),2007 ONCA 454,31 BLR (4th) 20,49 CCLT (3d) 161,[2007] OJ No 2443 (QL),159 ACWS (3d) 306,225 OAC 143,(2007), 225 OAC 143 (CA),225 O.A.C. 143,[2007] O.J. No 2443 (QL)
• Date: 22 June 2007
• Court: Court of Appeal (Ontario)

Sauer v. Can. (A.G.) (2007), 225 O.A.C. 143 (CA)

MLB headnote and full text

Temp. Cite: [2007] O.A.C. TBEd. JN.050

Bill Sauer (plaintiff/appellant) v. The Attorney General of Canada on behalf of Her Majesty the Queen in Right of Canada as represented by the Minister of Agriculture, John Doe, Jane Roe, Ridley Inc . and Ridley Corporation Limited (defendants/respondent)

Bill Sauer (plaintiff/respondent) v. The Attorney General of Canada on behalf of Her Majesty the Queen in Right of Canada as represented by the Minister of Agriculture, John Doe, Jane Roe, Ridley Inc . and Ridley Corporation Limited (defendants/appellant)

Bill Sauer (plaintiff/respondent) v. The Attorney General of Canada on behalf of Her Majesty the Queen in Right of Canada as represented by the Minister of Agriculture, John Doe, Jane Roe, Ridley Inc. and Ridley Corporation Limited (defendants/appellant)

Proceeding under the Class Proceedings Act, 1992

(C45064; C45568; C45575; 2007 ONCA 454)

Indexed As: Sauer v. Canada (Attorney General) et al.

Ontario Court of Appeal

Catzman*, Goudge and LaForme, JJ.A.

June 22, 2007.

Summary:

The diagnosis of mad cow disease in an Alberta cow in 2003 resulted in catastrophic economic consequences for cattle farmers. Feed manufactured by Ridley allegedly infected the cow. Sauer commenced a proposed class action on behalf of cattle farmers, claiming against Ridley for negligence in making the feed and for failing to warn the cow's owner that the feed might be contaminated and against Canada for negligent regulation of the cattle industry. Ridley and Canada brought motions to strike the claims.

The Ontario Superior Court, in a decision reported at [2006] O.T.C. 13, dismissed Ridley's motion to strike the claim for negligence in making the feed, allowed Ridley's motion to strike the claim for failing to warn and dismissed Canada's motion. Sauer appealed the decision allowing Ridley's motion to strike the claim for failing to warn. Ridley and Canada both appealed the decisions striking their motions.

The Ontario Court of Appeal dismissed all three appeals.

Animals - Topic 2425

Diseased animals - Regulation and control - Duty of Crown - [See Crown - Topic 1566.1 ].

Crown - Topic 1566.1

Torts by and against Crown - Negligence by Crown - Negligent agricultural disease control - The diagnosis of mad cow disease in an Alberta cow in 2003 resulted in catastrophic economic consequences for cattle farmers - Sauer commenced a proposed class action on behalf of cattle farmers, claiming against Canada for negligent regulation of the cattle industry, specifically by passing a regulation in 1990 that permitted the inclusion of the contaminant linked to the disease in cattle feed and for failing to pass a regulation prohibiting the contaminant until 1997 - Canada's motion to strike the claim was dismissed - Canada appealed - The Ontario Court of Appeal dismissed the appeal - It was not plain and obvious that the claim would fail - The court accepted Sauer's assertion that Canada's public assumption of a duty to cattle farmers to ensure the safety of cattle feed established the proximity that could give rise to a prima facie duty of care - Further, Canada had not brought forward evidence that might establish that the impugned decisions were policy-related, rather than operational - See paragraphs 56 to 65.

Crown - Topic 1645

Torts by and against Crown - Actions against Crown - Defences, bars or exclusions - Policies or "policy" decisions - [See Crown - Topic 1566.1 ].

Torts - Topic 77

Negligence - Duty of care - Relationship required to raise duty of care - The diagnosis of mad cow disease in an Alberta cow in 2003 resulted in catastrophic economic consequences for cattle farmers - Feed manufactured by Ridley allegedly infected the cow - Sauer commenced a proposed class action on behalf of cattle farmers, claiming against Ridley for, inter alia, negligence in making the feed - Ridley's motion to strike the claim was dismissed - Ridley appealed, asserting that there was no prima facie duty of care because Sauer had not purchased or used its feed - The Ontario Court of Appeal dismissed the appeal - It was not plain and obvious that the claim would fail - The proximity of cattle farmers and feed manufacturers had to be examined in the context of the manufacture of contaminated feed - The catastrophic consequences of a single cow's infection were shared by all cattle farmers - Foreign sales were eliminated for all - In this way, cattle farmers were linked to Ridley as victims of contaminated feed - See paragraphs 32 to 43.

Torts - Topic 77

Negligence - Duty of care - Relationship required to raise duty of care - The diagnosis of mad cow disease in an Alberta cow in 2003 resulted in catastrophic economic consequences for cattle farmers - Feed manufactured by Ridley allegedly infected the cow - Sauer commenced a proposed class action on behalf of cattle farmers, claiming against Ridley for, inter alia, negligence in making the feed - Ridley's motion to strike the claim was dismissed - Ridley appealed, asserting that even if Sauer was able to establish that Ridley owed him a prima facie duty of care, the claim would fail due to residual policy considerations, including the spectre of unlimited liability and the fact that federal government regulations expressly permitted it to do what it did - The Ontario Court of Appeal dismissed the appeal - The proximity analysis depended very much on the particular facts - Without some demonstrated foundation, Ridley's concerns about unlimited liability remained speculation - Further, the existence of government regulations related to the standard of care, not to the question of whether a duty of care existed - See paragraphs 44 to 49.

Torts - Topic 86

Negligence - Duty of care - Duty to warn - The diagnosis of mad cow disease in an Alberta cow in 2003 resulted in catastrophic economic consequences for cattle farmers - Feed manufactured by Ridley allegedly infected the cow - Sauer commenced a proposed class action on behalf of cattle farmers, claiming against Ridley, for, inter alia, failing to warn the cow's owner that the feed might be contaminated - Ridley's motion to strike the claim for want of proximity was allowed - Sauer appealed - The Ontario Court of Appeal dismissed the appeal - Sauer was neither a purchaser nor user of Ridley's product - No court had ever imposed on a manufacturer a duty to someone who was not a purchaser or user to warn others who were - Any warning by Ridley would have had no impact on Sauer's conduct - Further, the duty to warn was designed to reduce safety risk through voluntary compliance - Here, where a single noncompliant farmer could produce catastrophic results for all farmers in Sauer's position, the risk of harm to cattle farmers would hardly be different whether or not Ridley was obliged to warn - See paragraphs 50 to 55.

Torts - Topic 4329

Suppliers of goods - Negligence - Manufacturers - Contaminated goods - [See both Torts - Topic 77 ].

Torts - Topic 4335

Suppliers of goods - Negligence - Manufacturers - Duty to warn users respecting dangers - [See Torts - Topic 86 ].

Cases Noticed:

Hunt v. T & N plc et al., [1990] 2 S.C.R. 959; 117 N.R. 321, refd to. [para. 25].

Cooper v. Registrar of Mortgage Brokers (B.C.) et al., [2001] 3 S.C.R. 537; 277 N.R. 113; 160 B.C.A.C. 268; 261 W.A.C. 268, refd to. [para. 26].

Childs v. Desormeaux et al., [2006] 1 S.C.R. 643; 347 N.R. 328; 210 O.A.C. 315, refd to. [para. 26].

Anns v. Merton London Borough Council, [1978] A.C. 728 (H.L.), refd to. [para. 26].

Hoffman et al. v. Monsanto Canada Inc. et al. (2007), 293 Sask.R. 89; 397 W.A.C. 89; 2007 SKCA 47, dist. [para. 42].

Donoghue v. Stevenson, [1932] A.C. 562 (H.L.), refd to. [para. 43].

Haskett v. Trans Union of Canada Inc. et al. (2003), 169 O.A.C. 201; 63 O.R.(3d) 577 (C.A.), refd to. [para. 45].

Haskett v. Equifax Canada Inc. - see Haskett v. Trans Union of Canada Inc. et al.

Ryan v. Victoria (City) et al., [1999] 1 S.C.R. 201; 234 N.R. 201; 117 B.C.A.C. 103; 191 W.A.C. 103, refd to. [para. 48].

Entreprises Sibeca Inc. v. Frelighsburg (Municipalité), [2004] 3 S.C.R. 304; 325 N.R. 345, refd to. [para. 64].

Authors and Works Noticed:

Feldthusen, Bruce, Economic Negligence: The Recovery of Pure Economic Loss (4th Ed. 2000), p. 190 [para. 53].

Counsel:

Cameron Pallett, Gilles Gareau, Clinton G. Docken and Reynold Robertson, for the appellant/respondent, Bill Sauer;

Robert B. Bell and Barry L. Glaspell, for the appellant/respondent, Ridley Inc.;

Dale L. Yurka and Joseph Cheng, for the appellant, the Attorney General of Canada.

These appeals were heard on February 13 and 14, 2007, by Catzman, Goudge and LaForme, JJ.A., of the Ontario Court of Appeal. Goudge, J.A., released the following decision for the Court on June 22, 2007. *Catzman, J.A., took no part in the decision.