And Who is my Neighbour? Superior Court Rejects Proposed Class Action by Survivors of the Rana Plaza Disaster

Written by on August 21, 2017.

Introduction

In April 2013, Rana Plaza – an unsanctioned commercial building on the outskirts of Dhaka, Bangladesh home to several clothing manufacturers – collapsed. The failure was driven in part by the industrial equipment required to manufacture garments in the building, which had a poorly built structure and was unsuited to heavy industry. The accident was the deadliest of its kind in modern history: over 1100 people were killed, and thousands more were seriously injured.

The factories inside the building crafted apparel for many internationally-known brands. Loblaws, by ownership of Joe Fresh, was among the companies that purchased goods originating in Rana Plaza. The Plaintiffs – injured garment workers and family members of garment workers that died in the collapse – sought to certify a class action in Ontario against Loblaws and Bureau Veritas (“BV”), a consulting service retained by Loblaws to conduct a “social audit” of factories in Bangladesh.

The Plaintiffs’ certification motion was heard before Justice Perell in April 2017. While the parties’ arguments were technical and intricate, fundamental aspects of the dispute turned on Justice Perell’s interpretation of two familiar sources: the New Testament and England’s House of Lords.[1]

And who is my neighbour?

In the biblical parable of the Good Samaritan, retold by Justice Perell, Jesus advised a lawyer that he could inherit eternal life by showing love to his neighbours. The lawyer, unsure how to interpret Jesus’ statement, countered: “And who is my neighbour?

In response, Jesus recounted the story of a passerby who showed mercy to an injured traveler on the side of the road – the passerby, explained Jesus, was a neighbour to the traveler.

Justice Perell contrasted the exchange with Lord Atkin’s decision for England’s House of Lords in Donoghue v Stevenson. Lord Atkins outlined a more restricted answer to the lawyer’s question: he would have told the lawyer that his neighbours are “persons who are so closely and directly affected” by his acts that he “ought reasonably to have them in contemplation” when directing his mind to the acts or omissions which are later called into question. English law, as exemplified by Lord Atkin’s decision, incorporates but does not depend on moral wrongdoing.

The question of one’s neighbour is naturally relevant to the existence of a duty of care, one element of a tort claim in negligence. The distinction between the words of Jesus and the decision of Lord Atkins—in other words, the asymmetry of ethical and legal duties—drove Justice Perell’s decision.

In seeking to prove the existence of a duty of care, the Plaintiffs emphasized that Loblaws was aware of the “notoriously dangerous” nature of garment manufacturing in Bangladesh, and responded by promulgating Consumer Social Responsibility (CSR) standards. Justice Perell, however, wrote that “it does not follow that because a person contemplates a moral duty that he, she, or it also contemplates a legal duty.”  Moreover, where the conduct alleged is a failure to act, foreseeability alone will not establish a duty of care, since “Loblaws may have had an ethical obligation to the employees, but to quote Lord Atkin in Donoghue v. Stephenson, “acts or omissions which any moral code would censure cannot in a practical world be treated so as to give a right to every person injured by them to demand relief.”

In this case, neither Loblaws nor Bureau Veritas owned or constructed Rana Plaza, nor did they cause its collapse. The workers in the Plaza were not employees of Loblaws’ subsidiaries; instead, they were suppliers to a supplier of one of Loblaws’ subsidiaries. The relationship between Loblaws and the workers at Rana Plaza could not be characterized by law as one of “proximity” or of being “neighbours” to one another. The Plaintiffs’ claim, rooted in an alleged breach of duty of care by not taking steps to protect the employees and others at Rana Plaza from the “villainy of third parties”, could not succeed.

Justice Perell agreed that some policy considerations favored recognizing a novel duty: for instance, holding Canadian corporations who profit by marketing themselves as responsible corporate citizens accountable, and preventing the exploitation of a regulatory vacuum in developing countries. Other factors, though, militated against a duty of care – chiefly the prospect of a “massive extension of liability” placed on businesses responsible for foreign suppliers.

 

In the absence of a duty of care, and for other reasons, the proposed class proceeding failed.

 

See also:

Das v George Weston Limited, 2017 ONSC 4129

[1] Justice Perell’s decision was wide-ranging, and canvassed numerous issues (including his own jurisdiction over the proposed class action and the development and applicability of the law of Bangladesh); see Das v George Weston Limited, 2017 ONSC 4129.

 

Posted in Class Actions