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On Appeal from the Court of Appeal for British Columbia Court File No. 33563 IN THE SUPREME COURT OF CANADA (ON APPEAL FROM THE COURT OF APPEAL FOR BRITISH COLUMBIA) BETWEEN: THE ATTORNEY GENERAL OF CANADA APPELLANT/RESPONDENT BY CROSS-APPEAL (THIRD PARTY) – and – IMPERIAL TOBACCO CANADA LIMITED, ROTHMANS, BENSON & HEDGES INC., ROTHMANS INC., JTI-MACDONALD CORP., B.A.T INDUSTRIES P.L.C., BRITISH AMERICAN TOBACCO (INVESTMENTS) LIMITED, CARRERAS ROTHMANS LIMITED, PHILIP MORRIS USA INC., PHILIP MORRIS INTERNATIONAL INC., R.J. REYNOLDS TOBACCO COMPANY and R.J. REYNOLDS TOBACCO INTERNATIONAL, INC. RESPONDENTS/APPELLANTS BY CROSS-APPEAL (APPELLANTS) – and – HER MAJESTY THE QUEEN IN RIGHT OF BRITISH COLUMBIA RESPONDENT (RESPONDENT) – and – ATTORNEY GENERAL OF BRITISH COLUMBIA and ATTORNEY GENERAL OF NEW BRUNSWICK INTERVENERS CONSOLIDATED FACTUM OF RESPONDENTS ON APPEAL AND CONSOLIDATED FACTUM OF APPELLANTS ON CROSS-APPEAL OF ROTHMANS, BENSON & HEDGES INC., ROTHMANS INC., PHILIP MORRIS USA INC. AND PHILIP MORRIS INTERNATIONAL INC. (pursuant to Rules 42 and 43 of the Rules of the Supreme Court of Canada) COUNSEL FOR ROTHMANS, BENSON & OTTAWA AGENT FOR ROTHMANS, HEDGES INC. AND ROTHMANS INC. BENSON & HEDGES INC. AND MACAULAY McCOLL LLP ROTHMANS INC. 1575 – 650 West Georgia Street GOWLING LAFLEUR HENDERSON LLP Vancouver, British Columbia V6B 4N9 2600 – 160 Elgin Street Telephone: 604-687-9811 Ottawa, Ontario K1P 1C3 Facsimile: 604-687-8716 Telephone: 613-233-1781 KENNETH N. AFFLECK, Q.C. Facsimile: 613-563-9869 HENRY S. BROWN, Q.C. COUNSEL FOR PHILIP MORRIS USA OTTAWA AGENT FOR PHILIP MORRIS INC. USA INC. DAVIS & COMPANY LLP GOWLING LAFLEUR HENDERSON LLP 2800 – 666 Burrard Street 2600 – 160 Elgin Street Vancouver, British Columbia V7Y 1K2 Ottawa, Ontario K1P 1C3 Telephone: 604-687-9444 Telephone: 613-233-1781 Facsimile: 604-687-1612 Facsimile: 613-563-9869 D. ROSS CLARK, Q.C. HENRY S. BROWN, Q.C. COUNSEL FOR PHILIP MORRIS OTTAWA AGENT FOR PHILIP MORRIS INTERNATIONAL INC. INTERNATIONAL INC. McCARTHY TÉTRAULT LLP GOWLING LAFLEUR HENDERSON LLP 1300 – 777 Dunsmuir Street 2600 – 160 Elgin Street Vancouver, British Columbia V7Y 1K2 Ottawa, Ontario K1P 1C3 Telephone: 604-643-5983 Telephone: 613-233-1781 Facsimile: 604-622-5614 Facsimile: 613-563-9869 SIMON V. POTTER HENRY S. BROWN, Q.C. MICHAEL A. FEDER COUNSEL FOR THE ATTORNEY OTTAWA AGENT FOR THE ATTORNEY GENERAL OF CANADA GENERAL OF CANADA DEPARTMENT OF JUSTICE DEPARTMENT OF JUSTICE 234 Wellington Street, East Tower 234 Wellington Street, East Tower Ottawa, Ontario K1A 0H8 Ottawa, Ontario K1A 0H8 Telephone: 613-948-1483 Telephone: 613-941-2351 Facsimile: 613-957-0195 Facsimile: 613-954-1920 PAUL VICKERY CHRISTOPHER RUPAR TRAVIS HENDERSON COUNSEL FOR IMPERIAL TOBACCO OTTAWA AGENT FOR IMPERIAL CANADA LIMITED TOBACCO CANADA LIMITED HUNTER LITIGATION CHAMBERS OSLER, HOSKIN & HARCOURT LLP 2100 – 1040 West Georgia Street 1900 – 340 Albert Street Vancouver, British Columbia V6E 4H1 Ottawa, Ontario K1R 7Y6 Telephone: 604-891-2400 Telephone: 613-787-1009 Facsimile: 604-647-4554 Facsimile: 613-235-2867 JOHN J.L. HUNTER, Q.C. PATRICIA J. WILSON BRENT B. OLTHUIS OSLER, HOSKIN & HARCOURT LLP Box 50, 1 First Canadian Place Toronto, Ontario M5X 1B8 Telephone: 416-362-2111 Facsimile: 416-862-6666 DEBORAH A. GLENDINNING COUNSEL FOR JTI-MACDONALD OTTAWA AGENT FOR JTI- CORP., R.J. REYNOLDS TOBACCO MACDONALD CORP., R.J. REYNOLDS COMPANY AND R.J. REYNOLDS TOBACCO COMPANY AND R.J. TOBACCO INTERNATIONAL, INC. REYNOLDS TOBACCO FARRIS, VAUGHAN, WILLS & INTERNATIONAL, INC. MURPHY LLP GOWLING LAFLEUR HENDERSON LLP 2500 – 700 West Georgia Street 2600 – 160 Elgin Street Vancouver, British Columbia V7Y 1B3 Ottawa, Ontario K1P 1C3 Telephone: 604-684-9151 Telephone: 613-233-1781 Facsimile: 604-661-9349 Facsimile: 613-563-9869 JEFFREY J. KAY, Q.C. HENRY S. BROWN, Q.C. ROBERT J. McDONELL TERESA M. TOMCHAK COUNSEL FOR B.A.T INDUSTRIES OTTAWA AGENT FOR B.A.T P.L.C. AND BRITISH AMERICAN INDUSTRIES P.L.C. AND BRITISH TOBACCO (INVESTMENTS) LIMITED AMERICAN TOBACCO SUGDEN, McFEE & ROOS LLP (INVESTMENTS) LIMITED 700 – 375 Water Street STIKEMAN ELLIOTT LLP Vancouver, British Columbia V6B 5N3 1600 – 50 O’Connor Street Telephone: 604-687-7700 Ottawa, Ontario K1P 6L2 Facsimile: 604-687-5596 Telephone: 613-566-0546 CRAIG P. DENNIS Facsimile: 613-230-8877 MICHAEL D. SHIRREFF NICHOLAS McHAFFIE COUNSEL FOR CARRERAS OTTAWA AGENT FOR CARRERAS ROTHMANS LIMITED ROTHMANS LIMITED HARPER GREY LLP STIKEMAN ELLIOTT LLP 3200 – 650 West Georgia Street 1600 – 50 O’Connor Street Vancouver, British Columbia V6B 4P7 Ottawa, Ontario K1P 6L2 Telephone: 604-687-0411 Telephone: 613-566-0546 Facsimile: 604-669-9385 Facsimile: 613-230-8877 CHRIS RUSNAK NICHOLAS McHAFFIE COUNSEL FOR HER MAJESTY THE OTTAWA AGENT FOR HER MAJESTY QUEEN IN RIGHT OF BRITISH THE QUEEN IN RIGHT OF BRITISH COLUMBIA COLUMBIA BULL, HOUSSER & TUPPER LLP BURKE-ROBERTSON LLP 3000 – 1055 West Georgia Street 70 Gloucester Street Vancouver, British Columbia V6E 3R3 Ottawa, Ontario K2P 0A2 Telephone: 604-687-6575 Telephone: 613-566-2058 Facsimile: 604-641-4949 Facsimile: 613-235-4430 DANIEL A. WEBSTER, Q.C. ROBERT E. HOUSTON, Q.C. RYAN D.W. DALZIEL COUNSEL FOR THE ATTORNEY OTTAWA AGENT FOR THE ATTORNEY GENERAL OF BRITISH COLUMBIA GENERAL OF BRITISH COLUMBIA ATTORNEY GENERAL OF BRITISH BURKE-ROBERTSON LLP COLUMBIA 70 Gloucester Street 6th Floor, 1001 Douglas Street Ottawa, Ontario K2P 0A2 Victoria, British Columbia V8W 9J7 Telephone: 613-566-2058 Telephone: 250-356-8875 Facsimile: 613-235-4430 Facsimile: 250-356-9154 ROBERT E. HOUSTON, Q.C. GEORGE H. COPLEY, Q.C. COUNSEL FOR THE ATTORNEY OTTAWA AGENT FOR THE ATTORNEY GENERAL OF NEW BRUNSWICK GENERAL OF NEW BRUNSWICK BENNETT JONES LLP FASKEN MARTINEAU DuMOULIN LLP Box 130, 1 First Canadian Place 1300 – 55 Metcalfe Street Toronto, Ontario M5X 1A4 Ottawa, Ontario K1P 6L5 Telephone: 416-777-7472 Telephone: 613-236-3882 Facsimile: 416-863-1716 Facsimile: 613-230-6423 JEFFREY S. LEON LESLIE MILTON Table of Contents i CONSOLIDATED FACTUM OF RESPONDENTS ON APPEAL PART I – STATEMENT OF FACTS............................................................................................. 1 A. Overview ............................................................................................................................... 1 B. Key facts ................................................................................................................................ 3 PART II – QUESTIONS IN ISSUE ............................................................................................... 5 PART III – STATEMENT OF ARGUMENT ................................................................................ 6 A. Since this appeal arises from a motion to strike, Canada must show that it is plain and obvious that the defendants’ claim has no chance of success under the Anns/Cooper test.......................................................................................................................................... 6 B. The defendants’ claim arguably satisfies the first stage of the Anns/Cooper test. ................ 7 I. The potential for harm to the defendants was reasonably foreseeable. ....................... 7 II. There was proximity between Canada and the defendants.......................................... 8 (a) Proximity can be founded on the defendants’ reasonable and foreseeable reliance. .......................................................................................................... 9 (b) The defendants do not rely on Canada’s statutory duties to establish proximity...................................................................................................... 10 (c) The alleged duty to the defendants poses no conflict with Canada’s duties to the public. ...................................................................................... 12 C. The defendants’ claim arguably satisfies the second stage of the Anns/Cooper test........... 14 I. Evidence is needed to determine if Canada’s prima facie duty should be negated... 14 II. Canada’s prima facie duty is not negated by concerns about indeterminate liability....................................................................................................................... 15 (a) Canada knew the defendants’ identities and its statements were used for their intended purpose.................................................................................. 15 (b) Liability is not indeterminate as to amount, time or class............................ 16 III. Canada’s alleged misrepresentations were operational conduct, not policy decisions..................................................................................................................... 17 IV. Canada’s prima facie duty does not create an “unintended insurance scheme”........ 20 PART IV – SUBMISSIONS CONCERNING COSTS ................................................................ 20 PART V – ORDER REQUESTED............................................................................................... 20 PART VI – TABLE OF AUTHORITIES..................................................................................... 21 PART VII – PROVISIONS DIRECTLY AT ISSUE ................................................................... 24 Table of Contents ii CONSOLIDATED FACTUM OF APPELLANTS ON CROSS-APPEAL PART I – STATEMENT OF FACTS........................................................................................... 41 A. Overview ............................................................................................................................. 41
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