Amici Curiae: Tim Hortons Action Dismissed, the Via Rail Class Action, and the Case of Pierre Poutine

Not So Fresh

An Ontario Superior Court judge has refused to certify a class action brought by a group of Tim Hortons franchisees (led by Brule Foods) in 2008 over changes made by the company nearly a decade ago. These changes, effected in 2002, included centralizing donut and pastry baking at a company plant in Brantford. The baked goods would be baked, frozen, and then shipped to individual shops for reheating and sale. Donuts were previously baked on-site by the individual franchisees as needed.

The judge has aptly named this change in process the “Always Fresh Conversion.” Prior to the change, the size and quality of the items varied by batch and location. The new method has streamlined the process, but has more than doubled costs for owners, while creating a new stream of revenue for the company. Whereas the material cost of a donut was 7¢ before the conversion, this has increased to as much as 20¢, depending on the specific item.

The group made three major claims: (1) Tim Hortons is in violation of an implied term that ingredients would be sold at a price lower than the market rate, (2) franchisees are forced to sell specific items (soups, salads) at a loss, and (3) Tim Hortons is in violation of good faith and fair dealing obligations toward owners. In addition, plaintiffs have claimed offences under the Competition Act.

In his 140-page decision, the judge dismissed the case on his observation that it was a rational business decision for the company, and that the franchise owners were simply looking for a greater share of profits. There are no indications that the plaintiffs will appeal the ruling.


The Cost to Via Rail

After Sunday afternoon’s tragic Via Rail train derailment, lawyers were practically first on the scene. It only took one day for lawyers to file a class-action lawsuit for injured passengers.

Falconer Charney LLP, a firm based in Toronto, has paired up with Windsor-based firm, Sutts, Strosberg LLP. A notice of action was filed with the Ontario Superior Court of Justice in Toronto. It is no surprise that Sutts is representing the plaintiffs in this action, as they reached a settlement in a class action against Via Rail and CN in 2002 after a derailment in 1999.

On Sunday afternoon, despite good weather, Via Rail train #92 derailed on a straight track by Burlington, Ontario. The train was switching tracks at the time – an otherwise normal procedure – when it jumped off the tracks. In the accident, three Via Rail employees were killed, and 45 passengers were taken to hospitals. While this is an appropriate case for a class action, a judge must first certify it. Roughly half of the 70 passengers have already indicated an interest in joining the suit.

In early stages of the investigations, the Transportation Safety Board revealed on Thursday that the train was travelling at approximately 107 km per hour at the time of derailment. In that particular area, the train should have been traveling at no more than 24 km per hour. It is unknown who was driving at the time.

This derailment highlights the antiquity of the Canadian rail system. There are many criticisms of Canadian public transit – safety has made improvements to the rail system a greater priority. One rail expert has noted that this event could have been prevented with a more advanced control system. He explained that it is time for Canada to install a computerized train control system – much like other countries.

The cost of updating the national rail system could be anywhere between ten and fifteen billion dollars. However, these are improvements that will need to be made eventually. How many other lives have to suffer before necessary changes are implemented? This is a cost-benefit analysis that I hope the class action law suit will expedite.


A Canadian Scandal, Cheese Curds and All

In another round of name calling and shifting of blame, we are left in the same dumbfounded position we were at the end of the last Federal election: Who is Pierre Poutine? During the last federal election in May 2011, an individual under the alias of ‘Pierre Poutine’ engaged in electoral fraud while using a prepaid cellphone. The disposable cellphone purchased with cash combined with the All-Canadian name has made it difficult to determine who is responsible.

Last May, residents in 57 ridings reported misleading or harassing phone calls during the run up to the election date. Most notably, voters in Guelp received automated calls that claimed to be from Elections Canada. The call instructed voters, incorrectly, that their polling stations had been relocated. Other harassing phone calls came from individuals pretending to be Liberal candidates. The Ottawa Citizen revealed last week that there was a connection between the calls and the Conservative party. This led to a good old-fashioned session of finger pointing on Parliament Hill. Unfortunately, the issue has not yet been resolved and Pierre Poutine is still at large.

Although Harper dismissed robo-call scandal as a ‘smear campaign’ during the question period on Wednesday, these events have major implications on our electoral process. Not only does activity like this affect voter perception and discourage participation, it also raises issues about open access and voter’s rights in our democracy. The investigation has only just begun.

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