Archive for October 6th, 2008

Class action suits against governmental agencies in the U.S. and Canada for alleged negligence saw mixed results in a pair of recent rulings this past week, with a favorable ruling for the plaintiffs from a federal trial court in Louisiana and a ruling for the government by an appellate court in Ontario.

As the AP reported on Friday, a federal judge in New Orleans refused to dismiss, on governmental immunity grounds, a class action brought against the Federal Emergency Management Agency (FEMA).  The case has been brought on behalf of a would-be class of Hurricane Katrina victims, who were allegedly harmed as a result of the agency’s inaction and negligence in discovering that trailers that were brought in to provide emergency housing after storm were contaminated with formaldehyde.  According to the AP story, the portion of the court’s order declining to recognize immunity relied on evidence that FEMA officials put “their heads in the sand” rather than conduct testing to find the contamination, for fear that affirmative steps by the agency to determine the existence and extent of the problem would lead to liability for the agency.  The court did agree that the agency’s conduct in making the trailers available to hurricane victims in the first place was an exercise of discretion that should be protected from “judicial second-guessing.”

By contrast, according to a story by The Canadian Press last week (thanks to the blog Beauty and the Breast for the link), the Ontario Court of Appeal recently upheld the dismissal of a would-be class action claim against the Canadian agency Health Canada, alleging negligence in the agency’s regulation of manufacturers of silicone breast implants.  The Court of Appeal reportedly based its decision in part on the reasoning that to allow the imposition of liability for negligence for an agency’s actions in performing regulatory functions within its mandate could have the effect of causing “decreased vigilance” by the regulated industry in ensuring the safety of its own products.

The two decisions must be understood in the context of the different statutes that allow for tort actions against the government in the U.S. and Canada, but the standards under the two laws appear to be similar.  In the U.S., negligence claims against the federal government are governed by the Federal Tort Claims Act, or FTCA.  For a good summary of the FTCA and several of its key exceptions, including the “discretionary function” exception that appears to have been the issue in the FEMA case, see this report to Congress from the Congressional Research Service.  Vancouver attorney Brad M. Caldwell has written this introductory overview of the Canadian counterpart to the FTCA, the Crown Liability Act.  It appears that the recent Ontario Court of Appeal decision turned in part on a special element for evaluating the existence of a duty of care in evaluating negligence claims against the government, which looks to “whether there are residual policy considerations outside the relationship of the parties that may negative the imposition of a duty of care.” 

The two cases may also be distinguished based on the function being undertaken by the agency in committing the alleged negligence.  In contrast to the clearly regulatory function at issue in the Health Canada case, FEMA was carrying out an executive function in providing emergency housing to hurricane victims.

Neither decision appears to have addressed the issue of whether the claims were appropriate for class certification.  Individual fact questions regarding causation and damages would appear to provide a possible barrier to class treatment in the FEMA case, but the court has yet to rule on class certification.

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