On October 5, 2012, the Ontario Superior Court of Justice struck out an action brought by Trillium Power Wind Corporation (Trillium) against the Ontario government seeking $2.5 billion in damages occasioned by Ontario’s February 2011 moratorium on offshore wind farms.
In Trillium Power Wind Corporation v. Ontario (Natural Resources), on a motion to strike out the action, brought by Ontario, the court ruled that Trillium’s statement of claim (which alleged breach of contract, unjust enrichment, expropriation, negligent misrepresentation, negligence, misfeasance in public office, and intentional infliction of economic harm) failed to disclose a reasonable cause of action and should be struck out, without leave to amend.
Application of the Decision
This decision, especially in light of the Ontario Divisional Court’s decision in Skypower CL I LP v. Minister of Energy, makes it clear that proponents who choose to participate in discretionary government programs, such as Ontario’s renewable energy program, do so at their own risk. Governments may alter the policies which underlie a program, and may even alter or cancel such programs, in a manner which may be fully lawful and immune from civil suit. Much will depend upon the particular facts of a case.
Even if the plaintiff can plead a special relationship with government actors which arguably gave rise to a private law duty of care, the duty of care may be negated by the court for reasons of public policy.
Unless participation in the government program has resulted in a legally binding contract, the granting of legally binding approvals to proceed with the project, or clearly unlawful conduct on the part of government (i.e., violation of a statute, or clear malicious intent to harm the plaintiff), it appears unlikely that a program applicant can sue the government simply on the basis that money was spent attempting to meet program criteria.
Courts will recognize the legitimacy of ministerial discretion, including the discretion to impose a moratorium or change a program policy midway through the life of a program, provided the discretion is statutorily authorized and is exercised in good faith. Despite Trillium’s allegation that the moratoria on offshore wind farm development in this case were made for “purely political” reasons, this decision emphasizes that political factors, such as strong public opposition, are legitimate public policy considerations. As here, the court may conclude that “the remedy for a political decision that a party does not agree with is found in ballot box, not the courtroom.” Read article