Friday, December 24, 2010

This Week At The Court Of Appeal: 12-12-24

Each week, Wise Law Blog will review recent decisions from the Ontario Court of Appeal.

Harris v. Glaxosmithkline Inc.
A class action against the the pharmacorp responsible for Paxil, a widely used antidepressant. The class suit alleged that GSK Inc. misused the Patent Act to delay the entry of a generic Paxil equivalent onto the Canadian market and thus profited unjustly by selling at an inflated price. At trial level, GSK moved to strike the claim and dismiss the action; the judge agreed on the basis that the pleadings did not disclose a viable cause of action against the defendant.

The Court of Appeal upheld the dismissal of action, considering each of the appellants' arguments in turn. They dismissed a potential tort of abuse of process on the basis that the common law precedent is that liability does not exist when the defendant employs regular legal process, even if they do so with bad intentions. For much the same reason they dismissed the potential tort of conspiracy to injure, on the basis that again the defendant was merely using the existing legal framework of patent regulation in a proper manner (albeit in a way that ended up causing harm to the class). Further, although the Court agreed with the appellants that the trial judge's decision to analyze prior decisions where GSK had failed to successfully sue makers of generic drugs and then claim that the appellants' allegations of sham litigation were "patently ridiculous" was not respectful of the plaintiffs' action, they nonetheless agreed that the pleading of sham litigation did not disclose a viable cause of action against GSK for the class. Read-the-whole-case rating: 2 for a decision that serves to illustrate the process of a class action being stripped down and found wanting.

Vanos v. Vanos. Following a divorce trial, the divorcing husband raised 14 issues on appeal. The Court of Appeal was only willing to consider seven of them. They considered the lump sum award of spousal support made by the trial judge as appropriate, given the appellant's history of failing to honour court orders for support and that the trial judge found that the appellant tended to put his own financial interest ahead of his former wife and his children. The Court also agreed with the Trial judge that that spousal support should be retroactive to before the date of the first support order, since the appellant knew the respondent would require support before that time.

The Court also dismissed the appeal regarding the disposition of a jointly-owned time share, which the appellant wished to remain jointly owned and which the trial judge had ordered the respondent wife to transfer her interest to the appellant. The Court suggested that since the appellant had assumed exclusive use of the time share post-separation, it made sense for the trial judge to order disposition of the property thusly.

The Court did agree with the appellant on several grounds, however. They agreed that his (lesser) 2008 income was the proper measure by which to calculate spousal support, as opposed to the greater 2007 income which the trial judge used. They also agreed that the trial judge had no grounds to order that the appellant vest a portion of his RRSPs in order to pay an outstanding line of credit, and that a phantom stock payment made in 2007 was post-valuation date and should not be therefore included in the equalization. However, the Court then pointed out that many of the appellants' arguments were simply him seeking to re-try the case from trial, and were dismissive of that attempt. Read-the-whole-case rating: 3.5 for a good example of how a trial judge can address an especially contentious party in a divorce trial and have it stick; in this case, most of the decisions that went against the appellant were upheld.

Ontario v. Phaneuf. Another class action, this time on behalf of individuals held for mental assessment under s.672.11 of the Criminal Code who were detained in a jail rather than in a hospital. The Divisional Court dismissed the claim for lack of a viable action; Ms. Phaneuf, representing the class, appealed the dismissal. Her grounds for the action which she chose to appeal were threefold: that her s.7 and s.9 Charter rights were violated by detaining her in a jail rather than in a hospital bed; that detention in jail rather than in a hospital bed was a breach of the province's fiduciary duty to her; and that the Crown negligently failed to comply with the order issued in R. v. Hussein, where Desmarais J. stated that the government was to have sufficient hospital beds available at all times for all such assessments. Ms. Phaneuf acknowledged that her claims depended on the existence of a duty on the Crown to place assessees in the hospital immediately, rather than to place assessees in the hospital as soon as a bed became available.

In regards to the appellant's first cause of action, the Court found that s.672.11 and its related provisions do not demand that custody be limited only to within a hospital, and further suggested that, since the way assessments are handled under the Code demands they be handled speedily, therefore any reading of the Code in this matter should be undertaken with the view that assessments should be a minimal burden to the assessee.

The fiduciary argument was denied by the Court in a single paragraph, as citing the fiduciary duty of the province to its citizens, in the Court's view, demands that that duty be to act in the public interest, as opposed to the specific interest of an assessee. (Clearly the Court felt that these two interests would work at cross-purposes, which is interesting in and of itself.)

In regardsto the argument stemming from Hussein, the Court pointed out that in Hussein, Desmarais J. never in fact made an order, but instead only cited reasons for her judgement, which could not in and of themselves be binding orders upon the Crown. (Earlier in the decision, the Court also stated that to the extent that Hussein could be read as requiring immediate transfer of assessees to hospitals, that case was wrongly decided.)

Although the Court was not unsympathetic to the plight of mental assessees in Ontario, and indeed added a postscript specifically to make it clear that their decision should not be read as condoning the warehousing of the mentally ill in jail, they ultimately upheld the dismissal. Read-the-whole-case rating: 3.

- Christopher Bird, Toronto
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