Statement from CEI Counsel Hans Bader on Today’s Ruling in British Columbia v. Imperial Tobacco

<?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Washington, DC, September 29, 2005—In today’s ruling in British Columbia v. Imperial Tobacco, the Supreme Court of Canada has gravely eroded the Charter of Rights and Freedoms by upholding a troubling British Columbia law, the Tobacco Damages & Health Care Costs Recovery Act.  The law retroactively holds tobacco companies liable for health care costs paid for by the provincial government for illnesses associated with tobacco use, even though the tobacco was sold legally in B.C. to willing consumers, waiving the statute of limitations.  It denies companies the ability to raise time-honored equitable defenses, such as showing that smokers knew of the dangers of smoking and smoked anyway, or that factors other than smoking contributed to many of the illnesses for which the Province seeks to recover health care costs.  It prevents companies from adequately defending themselves, denying the opportunity to prove that they did not cause an individual smoker’s disease or to challenge health care costs from treating that smoker.   <?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />


The decision is an affront to the rule of law guaranteed by the Charter of Rights and Freedoms.  It denies equality in the law and the right to a fair trial.  It also violates the principles that the government should be bound by ordinary law and govern though laws of general application.  It is also a radical departure from the norms of Anglo-American justice.


Even the Florida Supreme Court, a court famously willing to change settled legal rules to promote lawsuits against tobacco companies and jackpot justice, did not go as far as the Canadian Supreme Court.  In 1996, a sharply divided state Supreme Court ruled 4 to 3 that Florida could make tobacco companies pay for the state’s health care costs resulting from tobacco use.  But all seven of the justices voted to strike down provisions similar to those upheld by the Canadian Supreme Court on the grounds that they obviously violated due process (see Agency for Health Care Administration v. Associated Industries of Florida, 1996). The Florida justices all recognized that tobacco companies had both the right to put on evidence showing that tobacco use did not cause an individual smoker’s disease, and the right to show that any health care costs spent on a smoker were not necessary or properly spent. Remarkably, the Canadian justices held precisely the contrary.  The Florida justices also recognized that overturning the statute of limitation to revive stale, long-dead tort claims violates due process.  Unfortunately, the Canadian justices held to the contrary, undermining the rule of law.


The Canadian Supreme Court’s decision violates equality in the law by allowing the government to selectively abolish time-honored defenses to lawsuits just for lawsuits brought by the government.  It creates a legal double standard and sets a terrible precedent.  Imagine a car crash in which a driver whose medical expenses were paid for by the Province ran a red light and crashed into a second driver who was slightly speeding, injuring both.   Under the Court’s reasoning, the Province could sue the second driver, who was less at fault, while abrogating his defenses, such as contributory negligence, and force him to pay its health care expenses.  At the very same time, it could use the very same defenses to defeat his attempt to offset its claims.


Hans Bader is special projects counsel at the Competitive Enterprise Institute. CEI is engaged in a constitutional challenge against the 1998 <?xml:namespace prefix = u1 />U.S. tobacco settlement. For interviews with Mr. Bader, please contact the media relations department at 202.331.2252 or Mr. Bader directly at 202.331.2278.