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Court File No.: 12023/01

OntarioSUPERIOR COURT OF JUSTICE

B E T W E E N:

WILFRED ROBERT PEARSON

Plaintiff

-and-

INCO LIMITED, HER MAJESTY THE QUEEN IN RIGHT OF ONTARIO,THE CORPORATION OF THE CITY OF PORT COLBORNE,

THE REGIONAL MUNICIPALITY OF NIAGARATHE DISTRICT SCHOOL BOARD OF NIAGARA, and

THE NIAGARA CATHOLIC DISTRICT SCHOOL BOARD

Defendants

Proceeding under the Class Proceedings Act, 1992

FACTUM OF THE DEFENDANT

THE REGIONAL MUNICIPALITY OF NIAGARA

(Certification motion returnable June 3, 4, 5, 6 & 7, 2002)

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TO: MARKLE, MAY, PHIBBSBarristers and Solicitors

438 University Avenue, 21st

FloorToronto, ON M5G 2K8

Eric GillespieTel: (416) 593-4385Fax:(416)593-4478

Solicitors for the Plaintiff

AND TO: KOSKIE MINSKYBarristers and SolicitorsSuite 900, 20 Queen Street WestToronto, ON M5H 3R3

Kirk M. BaertTel: (416) 595-2117Fax:(416) 977-3316


AND TO: DAOUST VUKOVICH BAKER-SIGAL BANKA LLPBarristers and Solicitors20 Queen Street West, 6th FloorToronto, ON M5H 3R3

Wolfgang Kauffman

Tel: (416) 597-8578Fax: (416) 597-8897


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AND TO: LENCZNER SLAGHT ROYCE SMITH GRIFFINBarristers and Solicitors

2600 130 Adelaide Street WestToronto, ON M5H 3P5

Alan J. LencznerTel: (416) 865-3090Fax:(416) 865-9010

Solicitors for the Defendant,

Inco Limited

AND TO: SISKIND CROMARTY IVEY & DOWLER LLPBarristers and Solicitors680 Waterloo StreetP.O. Box 2520London, ON N6A 3V8

Michael Peerless

Tel: (519) 672-2121Fax:(519) 672-6065

Solicitors for The District School Board ofNiagara and The Niagara Catholic DistrictSchool Board

AND TO: STIEBER BERLACH GIBBSBarristers and Solicitors

900 130 Adelaide Street WestToronto, ON M5H 3P5

Steven Stieber

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B E T W E E N:


Plaintiff

-and-




Defendants


FACTUM OF THE DEFENDANT

THE REGIONAL MUNICIPALITY OF NIAGARA


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(i) Nickel Emissions. 11(ii) Health Study Assessments. 13

C. THE RODNEY STREET AREA. 15

PART III THE LAW 20

A. THE CERTIFICATION CRITERIA. 20

B. PLEADINGS DO NOT DISCLOSE A CAUSE OF ACTION. 21

(i) The allegations against the Region 21(ii) The negligence allegations. 22(iii) The Medical Officer of Healths duties under the HPPA. 23(iv) No duty of care as alleged. 24

C. NO RATIONAL CONNECTION BETWEEN THE CLASS AND THECOMMON ISSUES. 28

D. THERE ARE NO COMMON ISSUES RELATING TO THE REGION. 33

(i) Definition of common issues. 33(ii) No common issue regarding allegations of negligence. 34(iii) No common issue regarding allegations of negligent misrepresentation. 36

E. PREFERABLE PROCEDURE. 39

F. PLAINTIFF NOT AN APPROPRIATE CLASS REPRESENTATIVE. 40

G. LITIGATION PLAN. 40

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B E T W E E N:


Plaintiff

-and-




Defendants


FACTUM OF THE DEFENDANTTHE REGIONAL MUNICIPALITY OF NIAGARA


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(d) a class proceeding would be the preferable procedure for theresolution of the common issues; and

(e) Mr. Pearson would fairly and adequately represent the interests ofthe class, has produced a plan for the proceeding that sets out aworkable method of advancing the proceeding on behalf of theclass and of notifying class members of the proceeding, and has nointerest in conflict with other class members.

Reference: Regions Book of Authorities, Tab 1.Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 5.

2. The Judge hearing the certification motion determines if the technical

prerequisites of s. 5 are met. Some of the criteria, such as the common issue and the

preferability requirements, ensure that a class action is in the best interests of all parties.

If there are better ways (i.e., another type of resolution is preferable) or if there is a

cheaper and easier way (i.e., the individual issues outweigh the common issues in a

class proceeding), then the motion ought to be dismissed so the alternatives can be

pursued.

3. It is the plaintiff who brings the motion for certification and who accordingly bears

the onus of proving the criteria set out above. It is important to keep this onus in mind.In the case at bar, the plaintiff cannot prove the following elements in his claim against

the Medical Officer of Health:

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4. The judge hearing the certification motion is in a unique position to guide the

parties and, in particular, to look out for the best interests of the putative class.

Dismissing a certification motion in a case such as this, where there is a superior

method of proceeding and where the individual issues outweigh any benefit of trying

common issues, does not penalize or harm the putative class. Rather, the motions

Judge is protecting the interests of the putative class by determining that a class

proceeding is not effective in the circumstances. Dismissal of the certification motion in

this case would simply be a judicial recognition that there is a better way to proceed, for

the reasons set out below.

PART II THE FACTS

A. THE REGION AND THE MEDICAL OFFICER OF HEALTH.

(i) Statutory authority and mandate.

5. The Regional Municipality of Niagara (the Region) was formed on January 1,

1970. Within the Regions boundaries are twelve operating municipalities, including the

City of Port Colborne. The Region provides certain services to the Niagara population

while other services are provided through the twelve city and town governments.

6. The Region has the powers, rights and duties of a Board of Health as prescribed

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Responding Motion Record of The Regional Municipality of Niagara.Affidavit of Dr. Robina C. Williams, sworn March 28, 2002, paras. 4-5.

8. The Medical Officer of Healths duties and powers relating to community health

protection and health hazards are prescribed by the HPPA.

Reference: Regions Book of Authorities, Tab 2A.Health Protection & Promotion Act, R.S.O. 1990, c.H.7, Part III.

9. A health hazard is defined in the statute as:

(a) a condition of premises;

(b) a substance, thing, plant or animal other than man; or

(c) a solid, liquid, gas or a combination of any of them;

that has or that is likely to have an adverse effect on the health of any person.

Reference: Regions Book of Authorities, Tab 2A.Health Protection & Promotion Act, R.S.O. 1990, c.H.7, s. 1.

(ii) Mandatory duties of the Medical Officer of Health.

10 Th M di l Offi f H lth d t d ti t t i ti 10 11

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12. The Medical Officer of Health or a Public Health Inspector may make a written

order requiring a person to take or to refrain from taking any action in respect of a health

hazard. There are conditions precedents to making such an order. The Medical Officer

or Inspector must be of the opinion that there are reasonable and probable grounds that

a health hazard exists and that an order is required to decrease the effect of or eliminate

the health hazard. The requirements of what is involved in making an order, what it may

include, and on whom it may be served are set out in s. 13 of the HPPA.


13. In addition, a Medical Officer of Health may give directions to persons whose

services are engaged by the Board of Health to eliminate or decrease health hazards.

The Medical Officer of Health may give direction in place of or with an order, again on

the basis of reasonable and probable grounds that a health hazard exists. The full

requirement of the circumstances in which directions may be given and to whom is set

out in s. 14 of the HPPA.


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(v) Protection from Liability.

16. A Medical Officer of Health is protected from personal liability such that no action

or proceeding for damages or otherwise can be commenced for any act done in good

faith in the execution or intended execution of any duty or power under the HPPA, or for

the alleged neglect or default in the execution in good faith of any such duty or power.


Regions Book of Authorities, Tabs 4B-4E.

B. PORT COLBORNE SOIL CONTAMINATION HISTORY.

(i) Nickel Emissions.

17. The Region adopts1 from Incos Factum the statement of facts regarding the

history of Incos Port Colborne facility, which opened in 1918 and operated with

production declining in the 1970s until nickel production ceased altogether in 1984.

18. The Region further adopts the statement of facts regarding the history of

emissions from the Inco facility, that over 97% of the total nickel emissions were

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Augustine consulted with the MOE and an independent consultant regarding the types

and quantities of various elements present in the soil on the property. Mr. Augustine

enquired of the Medical Officer of Health as to what would be an acceptable background

level of nickel in raw land to be used for residential housing. The then Medical Officer of

Health, Dr. J.N. Berkholder, consulted with the environmental toxicologist at the Ministry

of Health and advised Mr. Augustine that the nickel content in his soil was above

guidelines based on the potential effect on plant life. There were no guidelines based

on human health as to soil levels. Dr. Berkholder reported,

In essence, although we cannot predict deleterious effects on human health, neither can we giveassurance that this or any other level of nickel will be absolutely safe to human population. In theabsence of clear health guidelines, therefore, you are proposing a development for humanhabitation in an environment which is not acceptable for plant life. It then becomes a matter ofacceptability on the part of the purchasers in liability in the event that deleterious effects shouldoccur, which at this time cannot be predicted.

Reference: Transcript of Cross-Examination of Dr. R.C. Williams,Q. 4 - 13, pages 5 9.

Joint Compendium of Exhibits and Answers to Undertakings,Volume III, Tab N.6.

20. The levels of nickel in the surface soil generally follow the direction of the

prevailing winds so that they are found in an area running northeast from the Inco plant,which is in the southeastern section of residential Port Colborne. The Region accepts

the statement of fact on this and the computer mapping by Her Majesty, as well as the

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and specially trained technicians and scientists, and is the type of analysis not routinely

conducted in environmental investigations.

Reference: Transcript of Cross-Examination, Dr. R.C. Williams, Q. 44, pp. 22-23.

Motion Record of HMQ, Vol. III, Tab 5, Soil Investigation and Human HealthRisks For the Rodney Street Community, Port Colborne: March 2002, Pg. 16.

23. The Region adopts the statement of facts about determining soil conditions and

their source found in Incos Factum and, in particular, the conclusions that speciation

testing has shown various nickel forms in different areas in Port Colborne, and that the

speciation is site specific.

24. The Region further accepts the statement of fact concerning the issues of

potency, concentration, and routes of exposure to certain nickel forms in determininghealth effects and their cause, as set out in Incos Factum.

25. The Region repeats and adopts the statements of fact and submissions regarding

determining health effects and their cause found in Incos Factum.

(ii) Health Study Assessments.

26 Th R i i t l t 1991 f th MOE il t ti d

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Reference: Responding Motion Record of The Regional Municipality of Niagara.Affidavit of Dr. R.C. Williams, para. 15.

31. Concurrent with the ongoing analysis of the soil sampling and population health

data, the MOE, the City of Port Colborne and Inco developed a strategy to remediate

the soil in Port Colborne, which resulted in the process called the Community Based

Risk Assessment (the CBRA). The Region adopts the statements of fact regarding the

CBRA and its advantages as a method of proceeding set out in the Factums of Inco and

Her Majesty. The Region also adopts the statement of facts concerning the other

studies and the work of regulators described in the Factums of Inco and Her Majesty.

32. The Public Health Department has consistently participated in the CBRA process

and has supported all initiatives put forward by the stakeholders, the MOE, the City of

Port Colborne, and Inco to remediate the affected lands within the guidelines asdetermined by the MOE and the Community Risk Assessment. There has been heated

discussion on issues from time-to-time between the various parties and stakeholders

involved, but the CBRA has continued to move ahead. The Region supports it as a

process to resolve the public concerns regarding the Inco emissions in Port Colborne.

Reference: Responding Motion Record of The Regional Municipality of Niagara.Affidavit of Dr. R.C. Williams, paras. 17-18.

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Reference: Responding Motion Record of The Regional Municipality of Niagara.Affidavit of Dr. R.C. Williams, para. 20.

34. The results of the soil sampling showed that the soil contamination, in general,

was patchy. Properties with much lower soil contaminant levels were often

encountered between properties with much higher concentration. Conversely,

occasionally single properties with significantly elevated concentrations of some

elements were surrounded by property with much lower contaminant levels. Thispatchwork pattern was related to the interaction between atmospheric deposition,

placement of contaminated fill and property, specific landscaping and construction

activities.

Reference: Responding Motion Record of Her Majesty the Queen, Volume 3, Tab F.March 2002 Report, Part A, p. 22.

35. The report concluded, among other things, that the average soil nickel

concentration on residential properties in Rodney Street is 2,508 parts per million. Very

high soil nickel levels were not widespread throughout the community. The Medical

Officer of Health supports the MOEs findings in its March 2002 report of a soil nickel

intervention of 8,000 parts per million to protect toddler age children seven months to

less than five years, based on current knowledge.

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40. Any individuals who were found to have elevations on venenous testing were

followed up through their family doctor initially and referred to a tertiary centre, as

required. People whose blood level was not elevated to a level where medical

intervention was recommended were referred to their family physician if they had any

concerns.

Reference: Responding Motion Record of The Regional Municipality of Niagara.Affidavit of Dr. R.C. Williams, Tab C, page 3.

41. In its 2002 report, the MOE has set an interventional level of 1,000 parts per

million for lead for play areas on residential properties or in public areas covered by sod

or grass to which children have access. The bare soil intervention for lead was set at

400 parts per million for these areas. The MOE required action for the intervention

levels for lead through follow-up by individual residents to reduce personal exposure.

The Ministry of Environment identified 11 properties with soil lead levels in excess of

1,000 parts per million. This included two of the 25 properties with elevated soil nickel

levels, which were covered by the MOE clean-up order.

Reference: Responding Motion Record of Her Majesty, Vol. 3, Tab F.

Risk Assessment for the Rodney Street Community, Port Colborne:March 2002 Report.

42 The Medical Officer of Health has not exercised her discretion to make any

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samples. A design for the study protocol was reviewed and approved by both an

internal and formal external ethics committee with the actual interviewing and blood and

urine sampling to take place in November 2001. By that time, the Pearson lawsuit had

been commenced and the health study could not move forward due to low participation

by the community. There are various reasons as to why participation dropped from the

strong initial interest including the effect of the commencement of the lawsuit and

statements made by counsel for Mr. Pearson concerning the health study.

Reference: Responding Motion Record of The Regional Municipality of NiagaraAffidavit of Dr. R.C. Will iams, paras. 24 26.

44. In addition to these studies, the Public Health Department has fulfilled its duties

under the Health Promotion and Protection Act, and the Mandatory Health Programs

and Services Guidelines and responded to individual health concerns regarding soil

contamination in Port Colborne by providing:

(a) information through harm reduction advisories, fact sheets, informationsheets and question and answer sheets on heavy metals;

(b) communication strategies which have included community meetings, door-to-door drops, telephone hotlines, website postings and media interviews;

(c) open houses and personal meetings with residents to discuss specifichealth questions;

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45. The Public Health Department has complied with all aspects of the health hazard

investigation section of the Mandatory Guidelines which has guided its approach to the

Port Colborne community.

Reference: Transcript of Cross-Examination, Dr. R.C. Williams, Answer to Q. 43, p. 21.

46. The Region adopts from the Factums of Inco and Her Majesty the critique of the

recitation of the facts in the plaintiffs factum.

PART III THE LAW

A. THE CERTIFICATION CRITERIA.

47. Mr. Pearson must establish the five elements set out in s. 5 of the Class

Proceedings Act, 1992before the action can be certified as a class proceeding:

5(1) The court shall certify a class proceeding on a motion under section 2, 3 or 4 if,

(a) the pleadings or the notice of application discloses a cause of action;

(b) there is an identifiable class of two or more persons that would be represented bythe representative plaintiff or defendant;

( ) h l i d f f h l b i i

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48. The plaintiff cannot prove the following elements, and the action accordingly

ought not be certified as a class proceeding:

(a) That the pleadings disclose a cause of action against the Region;

(b) That there is a rational connection between the class as definedand the purported common issues;

(c) That there are common issues with respect to the Regions alleged

negligence in investigation and its alleged negligentmisrepresentations;

(d) That a class proceeding is the preferable method of resolving thedispute; and

(e) That the representative plaintiff can represent the classappropriately.

49. These issues are dealt with in turn below.

B. PLEADINGS DO NOT DISCLOSE A CAUSE OF ACTION.

(i) The allegations against the Region

50. Mr. Pearson has sued a number of defendants, and he has different potential

causes of action against each of the defendants. It is important to realize that Mr.

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52. The pleadings against the Region do not disclose a cause of action, as there is

no duty of care of the type alleged by the plaintiff. The analysis is set out below, after an

examination of the allegations against the Region.

(ii) The negligence allegations.

53. Mr. Pearson alleges in the Fresh As Amended Statement of Claim that the

Medical Officer of Health had numerous statutory responsibilities to the Class Members

pursuant to the Health Promotion and Protection Actand related legislation. He pleads

that the Medical Officer of Health knew or ought to have known that a lack of care would

cause damage to the class members, and that the Medical Officer of Health

consequently owed a duty of care.

Reference: Plaintiffs Motion Record, Volume II, Tab 1A, page 24.

Fresh As Amended Statement of Claim, para. 50.

54. Mr. Pearson made a general pleading that the Medical Officer of Health failed to

take such steps or apply such laws, regulations or guidelines as its mandate from time

to time required to prevent damage being caused to the class members. In particular,

he alleges that the Medical Officer of Health failed to monitor or investigate the refineryproperly, failed to warn of emissions and exposure to nickel oxide, failed to obtain

information in order to rectify known defects at the refinery, failed to respond to or study

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(b) To carry out her duties to investigate and respond to complaints asrequired pursuant to s. 11 of the HPPA;

(c) To keep informed of environmental and occupational healthhazards in Port Colborne; and

(d) Failed to make orders to protect public health and class membersas permitted pursuant to s. 13 of the HPPA.

Reference: Plaintiffs Motion Record, Volume II, Tab 1D, page 82.Niagara Particulars Reply, para. 4.

Plaintiffs Motion Record, Volume II, Tab 1D, page 89.Niagara Particulars Reply, para. 25.


(iii) The Medical Officer of Healths duties under the HPPA.

56. The mandatory duties of a Medical Officer of Health are contained in sections 10,

11, and 12 of the HPPA, as described in paragraph 10 above. The plaintiff has put

forward no evidence that the Medical Officer of Health failed to meet these duties, or

that any complaint has been made relevant to s. 11 of the HPPA. In contrast, the

evidence summarized in paragraphs 26-45 above is clear that the Medical Officer of

Health carried out her duties under the statute.

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issuing orders. It is important to realize that the ability to issue orders under the HPPA

is a discretionary power. The Medical Officer of Health chose to follow other options

which were available to her under the HPPA, as discussed above. There is no

allegation, much less evidence, that she exercised her discretion improperly, and there

can accordingly be no liability on her. The plaintiff has failed to make out even a

colourable claim in negligence.

59. Apart from this, there is an even more fundamental problem with both thenegligence and negligent misrepresentation claims. It is plain and obvious that there is

no cause of action, as the Region owes no duty of care of the type alleged by the

plaintiff.

(iv) No duty of care as alleged.

60. In Cooper v. Hobart, the Supreme Court held that a class action against the

British Columbia regulator of mortgage brokers could not be certified, as the regulator

owed no duty of care to the investors who had lost money.

Reference: Regions Book of Authorities, Tab 4.Cooperv. Hobart(2001), 206 D.L.R. (4th) 193 (S.C.C.).

61. In Cooper, the court revisited the duty of care issue. It held that the two-step

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Reference: Regions Book of Authorities, Tab 4.Cooperv. Hobart(2001), 206 D.L.R. (4th) 193 at 203 (S.C.C.).

62. The Supreme Court examined the statute governing the regulator to determine if

there was a relationship of sufficient proximity. The Court noted that, as a statutory

creation, the regulators duty of care could exist only through the governing statute:

In this case, the factors giving rise to proximity, if they exist, must arise from the statute underwhich the Registrar is appointed. That statute is the only source of his duties, private or public.Apart from that statute, he is in no different position than the ordinary man or woman on thestreet. If a duty to investors with regulated mortgage brokers is to be found, it must be in thestatute.

Reference: Regions Book of Authorities, Tab 4.Cooperv. Hobart(2001), 206 D.L.R. (4th) 193 at 207-208 (S.C.C.).

63. The Court reviewed the statute to determine whether any duty was owed. Inparticular, the court considered the investigatory powers of the regulator, the

discretionary powers in enforcing remedies, and the good faith defence set out in the

statute. Based on this, the Court concluded that no duty of care was owed to the

investors. Any duty of care was owed to the public at large:

In this case, the statute does not impose a duty of care on the Registrar to investors withmortgage brokers regulated by the Act. The Registrar's duty is rather to the public as a whole.Indeed, a duty to individual investors would potentially conflict with the Registrar's overarchingduty to the public. . . .

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conferred by the Act on the Registrar are necessary to undertake this delicate balancing. Eventhough to some degree the provisions of the Act serve to protect the interests of investors, theoverall scheme of the Act mandates that the Registrar's duty of care is not owed to investors

exclusively but to the public as a whole.

Accordingly, we agree with the Court of Appeal perNewbury J.A.: even though the Registrarmight reasonably have foreseen that losses to investors in Eron would result if he was careless incarrying out his duties under the Act, there was insufficient proximity between the Registrar andthe investors to ground a prima facieduty of care. The statute cannot be construed to impose aduty of care on the Registrar specific to investments with mortgage brokers. Such a duty would nodoubt come at the expense of other important interests, of efficiency and finally at the expense ofpublic confidence in the system as a whole. [Emphasis added.]

Reference: Regions Book of Authorities, Tab 4.Cooperv. Hobart(2001), 206 D.L.R. (4th) 193 at 209-210 (S.C.C.).

65. In concluding that no duty was owed, the Supreme Court considered the good

faith defence contained in the Mortgage Brokers Act, R.S.B.C. 1996, c. 313, s. 20:

Finally, s. 20 exempts the Registrar or any person acting under his authority from any actionbrought for anything done in the performance of duties under the Act or Regulations, or inpursuance or intended or supposed pursuance of the Act or Regulations, unless it was done inbad faith.


66. The good faith defence in the Mortgage Brokersprovided as follows:

Liability of registrar, commission, etc.20 An action may not be brought or continued against the registrar or a person acting under the

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Finally, and perhaps most indicative of the Legislature's intent, the Act provides statutoryimmunity in s. 9 of the Act which read:

9. No action or other proceedings for damages shall be instituted against the Treasurer orany bencher, official of the Society or person appointed in Convocation for any act donein good faith in the performance of any duty or in the exercise or in the intended exerciseof any power under this Act, a regulation or a rule, or for any neglect or default in theperformance or exercise in good faith of any such duty or power.

Reference: Regions Book of Authorities, Tab 6.Edwardsv. Law Society of Upper Canada(2001), 206 D.L.R. (4th) 211 at 219-220 (S.C.C.).

68. As in Edwardsand Cooper, the Medical Officer of Health and the health unit are

statutory creations. Any duties must be founded in the governing statute, the HPPA.

69. As in those two cases, the HPPA similarly confers supervisory, investigative, and

discretionary remedial functions on the Medical Officer of Health. The statute also

provides a good faith defence that is very similar:

Protection from personal liability

95(1) No action or other proceeding for damages or otherwise shall be instituted against amember of a board of health, a medical officer of health, an associate medical officer of health ofa board of health, an acting medical officer of health of a board of health or a public healthinspector for any act done in good faith in the execution or the intended execution of any duty or

power under this Act or for any alleged neglect or default in the execution in good faith of anysuch duty or power.

Reference: Regions Book of Authorities, Tab 2A.Health Protection & Promotion Act R S O 1990 c H 7 s 95(1)

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72. As in the Cooperand Edwardscases, it is inappropriate to impose on the Region

a duty of care of the type alleged by the plaintiff. The legislative intent is reflected in the

enactment of the good faith defence in s. 95.

73. Even if a prima facieduty were owed, the second branch of the Anns test would

negative it. Whether to exercise statutory discretion is a policy decision for which no

liability can attach.


74. The plaintiffs cannot establish that the pleadings, at least against the Region,

disclose a cause of action in negligence or negligent misrepresentation because there is

no duty of care of the type alleged by the plaintiff. The action therefore ought not be

certified against the Region.

C. NO RATIONAL CONNECTION BETWEEN THE CLASS AND THE COMMONISSUES.

75. The statute requires that there be an identifiable class of two or more that can be

represented by the plaintiff.

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appropriate way to define a class as against a polluter, it is inappropriate for the claims

against the Region.

Reference: Regions Book of Authorities, Tab 12.Mouhterosv. Devry Canada Inc.(1998), 41 O.R. (3d) 63 at 68 (Gen. Div.).

78. The geographical boundaries of the class are defined in an area that was

allegedly contaminated by emissions from the refinery. It must be remembered that the

claim against the Region is notthat it emitted pollutants. Instead, it is a claim that the

Region negligently failed to investigate, and that the Region negligently misrepresented

facts to the putative class.

79. A geographical definition of the class is therefore inappropriate for the types of

claims being advanced against the Region. The geographical boundary is arbitrary as

far as these claims are concerned. There is nothing in the putative class to limit the

class to people affected by the alleged negligent investigation, or to people who were

aware of and relied upon the alleged misrepresentations. Mr. Justice Winkler noted in

Mouhterosv. DeVrythat such a class definition ought not be certified:

In my view, there must be some connection between the class definition and the common issues.The mere fact that a group of people is identifiable is not sufficient to render them a class for thepurposes of the Act. Indeed, such a connection is contemplated by the wording of s. 5(1)(c),which mandates that the claims or defences of the class members raise common issues. . . .

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Justice Winklers analysis in Mouhteros and held that there must be a rational

connection between the way the class is defined and the common issues. It must be

apparent that allof the putative class members have issues in common, and that they

have a colourable claim against the Region. If not, the class ought not be certified as

defined:

In this case there is no doubt that, if each of the class members has a claim against therespondent, some aspect of the issue of liability is common within the meaning of s. 5(1)(c). For

any putative class member to prevail individually, he or she would have to show, among otherthings, that the respondent emitted pollutants into the air. At least this aspect of the liability issue(and perhaps other aspects as well) would be common to all those who have claims against therespondent. The difficult question, however, is whether each of the putative class members doesindeed have a claim -- or at least what might be termed a "colourable claim" -- against therespondent. To put it another way, the issue is whether there is a rational connection between theclass as defined and the asserted common issues: see Western Canadian Shopping Centres, atpara. 38 ("the criteria [defining the class] should bear a rational relationship to the common issuesasserted by all class members"). . . .

The respondent is of course correct to state that implicit in the "identifiable class" requirement isthe requirement that there be some rational relationship between the class and common issues.Little has been said about this requirement because, in the usual case, the relationship is clearfrom the facts. In a single-incident mass tort case (for example, an air plane crash), the scope ofthe appropriate class is not usually in dispute. The same is true in product liability actions (wherethe class is usually composed of those who purchased the product), or securities fraud actions(where the class is usually composed of those who owned the stock). In a case such as this,however, the appropriate scope of the class is not so obvious. It falls to the putativerepresentative to show that the class is defined sufficiently narrowly. [Emphasis added.]

Reference: Regions Book of Authorities, Tab 3.Hollickv. Toronto (City) (2001), 205 D.L.R. (4th) 19 at 30-31(S.C.C.).

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Reference: Regions Book of Authorities, Tab 3.Hollickv. Toronto (City) (2001), 205 D.L.R. (4th) 19 at 31(S.C.C.)

82. Although the motions court is not to rule on the merits of the action, the plaintiff

must adduce some evidence to prove that the certification criteria are met, as held in

Hollickv. Toronto:

I agree that the representative of the asserted class must show some basis in fact to support thecertification order. As the court in Taubheld, that is not to say that there must be affidavits from

members of the class or that there should be any assessment of the merits of the claims of otherclass members. However, the Report of the Attorney General's Advisory Committee on ClassAction Reform clearly contemplates that the class representative will have to establish anevidentiary basis for certification: see Report, at p. 31 ("evidence on the motion for certificationshould be confined to the [certification] criteria"). The Act, too, obviously contemplates the samething: see s. 5(4) ("The court may adjourn the motion for certification to permit the parties toamend their materials or pleadings or to permit further evidence."). In my view, the classrepresentative must show some basis in fact for each of the certification requirements set out ins.5 of the Act, other than the requirement that the pleadings disclose a cause of action. [Emphasis

added.]

Reference: Regions Book of Authorities, Tab 3.Hollickv. Toronto (City) (2001), 205 D.L.R. (4th) 19 at 33(S.C.C.)

83. An example of the absence of a rational connection for these claims against the

Region is provided by the plaintiff himself, Mr. Pearson.

84. Mr. Pearson resides within the geographical boundaries that establish the

putative class However there is no rational connection between him and the alleged

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Reference: Plaintiffs Motion Record, Volume II, Tab 1A, page 25.Fresh As Amended Statement of Claim, paras. 54-55.

86. In paragraphs 33 and 34 of his affidavit, Mr. Pearson swore that the

misrepresentations were contained in a number of technical reports and studies. He

reiterated this in his response to demands for particulars, in which he also stated that

all class members were misled by the reports.

Reference: Plaintiffs Motion Record, Volume I, Tab 2, pages 16-18.Pearson Affidavit (Jan. 17, 2002), paras. 31-38.




87. Despite swearing in his affidavit that he was misled and induced by the

representations contained in the reports, he admitted on cross-examination that he had

not read any of them:

CROSS-EXAMINATION BY MR. COOP:

102 Q. . . . Mr. Pearson, could I ask you to look at paragraphs 33 and 34 of youraffidavit, please.

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Reference: Pearson cross-examination dated January 17, 2002.Questions 102-104, pages 30-31.

88. Apart from any issues of credibility, the foregoing demonstrates the lack of any

rational connection between the class as defined and the alleged common issues

against the Region. Mr. Pearsons evidence demonstrates that not all of the putative

class members who live within the geographic boundaries will have any cause of action

against the Region for either negligence or negligent misrepresentation. Because the

class is defined in geographic terms it arbitrarily includes too many individuals, such as

Mr. Pearson, who have no claim against the Region.

89. In the Hollickcase, the Supreme Court noted that it is much more difficult to

prove the rational connection in an environmental-type case than product liability other

types of claims. The court specifically noted that the class cannot be overly broad bythe inclusion of people such as Mr. Pearson who have no claim against the Region.

90. The definition of the putative class is therefore deficient, at least insofar as it

relates to the Region. There is simply no rational connection between the putative

members and the alleged torts of negligence and negligent misrepresentation. This is

because the class is defined on geographic terms, and does not have any other

limitations with respect to these specific torts alleged against the Region.

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93. A common issue is defined as common but not necessarily identical issues of

fact or common but not necessarily identical issues of law that arise from common but

not necessarily identical facts.

Reference: Regions Book of Authorities, Tab 1.Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 1 common issues.

94. At this point, it is again important to recall the allegations against the Region.

The plaintiff is not alleging that the Region emitted pollutants. Rather, the plaintiff

pleads that the Medical Officer of Health was negligent in dealing with the claim and that

she negligently misrepresented facts to the putative class.

(ii) No common issue regarding allegations of negligence.

95. The plaintiff has stated the following common issue against the Region:

Did the Regulators owe a duty of care to the class to prevent the ongoing discharge of thecontaminants by Inco, and if so, what duty was owed?

96. The mandatory duties of the Medical Officer of Health were reviewed above at

paragraph 10. There is no mandatory duty which permits the Medical Officer of Health

to prevent Inco from discharging contaminants. There is simply no mandatory statutoryauthority to do so, and the Medical Officer of Health can only act pursuant to the statute.

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(e) The damages were sufficiently foreseeable by the defendant to becompensable.

99. In this case, the elements of negligence do not raise common issues. As

discussed above, the Region does not owe a duty of care of the type alleged by the

plaintiff, and this cannot be a common issue.

100. Apart from this, there are other reasons why the negligence allegation does not

raise common issues. The Medical Officer of Health can only act pursuant to the

authority granted by the HPPA. The application of the various mandatory duties and

discretionary powers to each putative class member would vary, depending on the

specific details of the bodily injury and property damage claims advanced.

101. In particular, the quantum of damages will obviously vary for each class member.

While the Class Proceedings Act, 1992 acknowledges that certification will not be

denied solely because damages need to be assessed individually, the plaintiff has

proposed no workable method to quantify damages. The end result is that there will be

individual trials in any event on the issue of damages.

102. With respect to the bodily injury claims, individual trials will be required to

determine whether the alleged negligence of the Medical Officer of Health caused

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104. In addition, the property damage and agricultural claims would not raise common

issues for other reasons. The quantity and species of nickel varies from property to

property, and each class members claim will be different. The proposed class

members will also have to show how the Medical Officer of Healths alleged negligence

or misrepresentation contributed to the harm, and this will vary for each class member.

105. The Region also adopts the submissions contained in the Factums of Inco and

Her Majesty on the absence of common issues related to negligence.

(iii) No common issue regarding allegations of negligentmisrepresentation.

106. The plaintiff states the following common issue relating to negligent

misrepresentation:

(iv) Did the Regulators make negligent misrepresentations with respect to: (a) the emissionsfrom the Inco Refinery have never posed any risk to human health; and (b) the classmembers were being exposed to nickel or other non-carcinogenic substances and not thecarcinogen nickel oxide?

107. As noted above in paragraphs 85-87, the plaintiff alleges that the Medical Officer

of Health made negligent misrepresentations to the putative class members in a number

of reports and studies.

108 Before analyzing the legal issues relating to the alleged misrepresentations it is

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(c) The plaintiff admitted that by the time the statement of claim wasissued on March 26, 2001, he did not trust and was skeptical of the

defendants. Again, he could not have been induced to rely uponany representations after that date.

Reference: Pearson cross-examination, Q. 247-249, p. 55.

(d) The Region adopts Her Majestys submissions on the distribution ofthe reports and that there are no misrepresentations contained inthe reports. In particular, the Region repeats that the material doesnotcontain the statements that:

(i) that the emissions from the refinery have not posedany immediate risk, or any risk, to human health; or

(ii) one of the substances the putative class memberswas and are being exposed to is nickel, and not theknown human carcinogen nickel oxide;

109. Mr. Pearson must prove five elements to establish liability for negligent

misrepresentation:

(a) there must be a duty of care based on a "special relationship"between the representor and the representee;

(b) the representation in question must be untrue, inaccurate, ormisleading;

( ) th t t h t d li tl i ki id

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110. Class proceedings for negligent misrepresentation are generally inappropriate,

due to the large number of individual issues. Mr. Justice Cumming noted the following

in Williamsv. Mutual Life Assurance Co.:

Negligent misrepresentation is a cause of action that is very problematic in seeking certification ofa common issue for class members. Proof is generally dependent upon a multitude ofcircumstances specific to the individual members. The result of the trial of any one allegedmisrepresentation to a claimant cannot generally stand as proof of the cause of action of anyother claimant. The outcome of class members' claims based upon alleged negligent

misrepresentations depends upon a myriad of individual evidentiary factors.Reference: Regions Book of Authorities, Tab 10A and B.

Williams v. Mutual Life Assurance Co. (2000), 51 O.R. (3d) 54 at 61-62(S.C.J.), affd (2001), 152 O.A.C. 344 (Div. Ct.).

111. This is particularly true where, as in the within action, the plaintiff alleges that the

misrepresentations were made in numerous forms (reports, letters, news reports, and

meetings) at different times to different people. The court in Controltech Engineering

Inc. v. Ontario Hydrodeclined to certify a class action for misrepresentation where the

putative representative plaintiff relied upon many different alleged misrepresentations,

as opposed to a single statement made by the defendant:

While there is a common factual core to the claims of the various bidders, I am not persuaded that

this common core amounts to a common issue for the purposes of s. 5. In particular, I fail to seehow the proposed common issues would resolve anything that would "move the litigation forward"in as much as it would still be necessary to examine what was said to each individual bidder withrespect to each individual claim. This is not a case that lends itself to determination of the

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117. The Region adopts the submissions of Inco and Her Majesty that a class

proceeding is not the preferable method of resolving this matter.

118. The Region also submits that a class proceeding in this case would not

accomplish the goal of judicial economy because there are too many individual and

complex issues arising out of different facts for each claimant, and involving different

issues and facts for each defendant. There should also be no concern with modification

of the Regions behaviour. The Medical Officer of Health has acted continuously andappropriately pursuant to her statutory duties and powers, and behaviour modification is

not necessary.

119. The Region repeats the submissions of Inco and Her Majesty that the plaintiff

cannot show that a class action is preferable to other procedures and the utility of the

CBRA.

F. PLAINTIFF NOT AN APPROPRIATE CLASS REPRESENTATIVE.

120. The Region adopts the submissions of Inco and Her Majesty that the plaintiff is

not an appropriate representative for the class.

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ALL OF WHICH IS RESPECTFULLY SUBMITTED

May 31, 2002Cassels Brock & Blackwell LLPBarristers & SolicitorsScotia Plaza, Suite 2100

40 King Street WestToronto, Ontario M5H 3C2

B. Robin Moodie LSUC#: 25459JTel: (416) 869-5734Fax: (416) 360-8877

Thomas J. Donnelly LSUC#: 42228JTel.: (416) 860-2954Fax: (416) 360-8877

Solicitors for the Defendant The RegionalMunicipality of Niagara

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SCHEDULE ALIST OF AUTHORITIES

1. Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 5.

2. A. Health Protection and Promotion Act, R.S.O. 1990, c. H.7.

B. Health Protection and Promotion Act, S.O. 1983, c. 10, s. 94.

C. Public Health Act, R.S.O. 1980, c. 409, s. 46.

D. Public Health Act, S.O. 1974, c. 87, s.2.

E. Public Health Act, R.S.O. 1970, c. 377, s. 42.

3. Hollickv. Toronto (City)(2001), 205 D.L.R. (4th) 19 (S.C.C.)

4. Cooperv. Hobart

(2001), 206 D.L.R. (4th) 193 (S.C.C.).

5. Mortgage Brokers Act, R.S.B.C. 1996, c. 313, s. 20.

6. Edwardsv. Law Society of Upper Canada(2001), 206 D.L.R. (4th) 211 (S.C.C.).

7. Western Canadian Shopping Centres Inc. v. Bennett Jones Verchere

(2001), 201 D.L.R. (4th) 385 (S.C.C.).

8. Queenv. Cognos Inc.(1993) 99 D L R (4th) 626 (S C C )

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PEARSONPlaintiff

andINCO LIMITED et. al.Defendants

Court File No: 12023/01

ONTARIOSUPERIOR COURT OF JUSTICE

Proceeding commenced at WELLAND

FACTUM OF THE DEFENDANTTHE REGIONAL MUNICIPALITY OF NIAGARA

(Certification motion returnable June 3-7, 2002)

Cassels Brock & Blackwell LLPBarristers & SolicitorsScotia Plaza, Suite 210040 King Street WestToronto, Ontario M5H 3C2

B. Robin Moodie LSUC#: 25459JTel: (416) 869-5734Fax: (416) 360-8877

Thomas J. Donnelly LSUC#: 42228JTel: (416) 860-2954Fax: (416) 360-8877

Solicitors for the Defendant,The Regional Municipality of Niagara

Documents

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