In March of this year the Ontario Court of Appeal (ONCA) heard
Trillium Power Wind Corporation's (TPWC) appeal from the
decision of the Superior Court of Ontario to strike its claim
against the province of Ontario.
Earlier this week, the ONCA released its decision in Trillium Power Wind
Corporation v Ontario (Ministry of Natural Resources).
TPWC is a Toronto-based developer interested in building offshore
wind turbines in Lake Ontario. Its proposed wind power project was
progressing under the regulatory structure and had achieved
Applicant of Record status when, in February 2011, Ontario
cancelled all offshore wind farm projects. In a news release,
Ontario explained the projects were cancelled "while further
scientific research [was] conducted."
TPWC subsequently brought numerous claims against Ontario
seeking over $2 billion in damages for, among other things, breach
of contract, unjust enrichment, negligent misrepresentation and
negligence, misfeasance in public office, and intentional
infliction of economic harm. Last year, Justice Goldstein of the
Ontario Superior Court struck Trillium's claim on the basis
that it disclosed no reasonable cause of action against Ontario.
(see our post on that decision
The ONCA agreed with Justice Goldstein on all but one of the
claims, allowing the appeal on the cause of action alleging
misfeasance in public office, but only on the narrower basis that
Ontario's conduct was specifically targeted to injure TPWC.
In its decision, the ONCA defined TPWC's claim as
essentially raising two complaints: (1) that Ontario unlawfully
deprived it of a lucrative off-shore wind-powered electric
generation project for an improper political purpose, namely to win
more seats at the upcoming election; and (2) that Ontario's
decision specifically targeted TPWC with a view to crippling it
financially so that it would not be able to contest the
government's actions. The latter assertion was based on the
fact that Ontario's news release was issued just hours before
the financing arrangement for TPWC's project was to close, of
which Ontario was aware.
As Ontario's decision to cancel the projects was a
governmental decision involving "political factors", at
law the decision was immune from attack unless it was irrational or
"taken in bad faith". TPWC argued, therefore, that
Ontario acted in bad faith and for an improper purpose of gaining
electoral votes. The ONCA disagreed. Except to the extent that it
specifically targeted TPWC in order to injure it financially, the
ONCA found that Ontario's decision to suspend all wind farm
projects was neither irrational nor in bad faith.
Even if Ontario's decision was motivated by electoral
expediency, and not the need for further research as it claimed,
the ONCA did not find this to constitute "bad faith" for
the purposes of a tort claim. In order to make out "bad
faith" for the purposes of the tort of misfeasance in a public
office, Ontario must have acted deliberately in a manner that was
"inconsistent with the obligations of office". In its
decision, the ONCA noted:
"Ministerial policy decisions made on the basis of
"political expediency" are part and parcel of the
policymaking process and, without more, there is nothing unlawful
or in the nature of "bad faith" about a government taking
into account public response to a policy matter and reacting
Having determined that "political/electoral
expediency" motivations for a governmental decision cannot,
alone, provide a basis for a claim in tort for misfeasance of
public office, the ONCA held that that part of TPWC's claim was
It was only to the extent that Ontario's decision had not
been made for political purposes that the decision was subject to
attack in tort. Accordingly, TPWC was entitled to proceed based on
the allegations that Ontario's actions were specifically meant
to injure it financially.
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Canada is a constitutional monarchy, a parliamentary democracy and a federation comprised of ten provinces and three territories. Canada's judiciary is independent of the legislative and executive branches of Government.
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