In Dewey v. Corner Brook Pulp and Paper Limited, 2025 NLCA 8, released on March 6, Justice Francis O’Brien overturned a finding by the lower court that it was plain and obvious that the Town of Deer Lake did not owe a duty of care to the proposed class.
“In my view, the pleadings respecting the proximate nature of the relationship between the Town and the class members satisfy the section 5(1)(a) requirement. That is, it is not plain and obvious from these pleadings that they cannot succeed because no duty of care is disclosed,” the judge wrote.
The proposed class action concerned damage caused by groundwater flooding to the properties of the appellant, Richard Dewey, and other residents of Deer Lake.
The appellant alleged that the damage was caused by the water control system of a hydroelectric power system constructed to supply power to Corner Brook Pulp and Paper Mill.
Dewey sought certification of a class action alleging that the Province of Newfoundland and Labrador and the respondents, Corner Brook Pulp and Paper Ltd. and the Town of Deer Lake, were responsible for the damages.
The appellant claimed both in nuisance and negligence against Corner Brook Paper, and in negligence against the town and the province.
In Dewey v. Kruger Inc., 2021 NLSC 118, a certification judge found that the pleadings disclosed no cause of action in negligence against the town and the province.
The certification judge found that the pleadings did not disclose a duty of care owed by the town to the class.
With respect to Corner Brook Pulp and Paper, the certification judge found that the pleadings disclosed a cause of action in both nuisance and negligence.
However, the judge concluded that the appellant had failed to establish some basis in fact for the proposed class action as the preferable procedure to resolve the claims of the class and declined to certify the action as a class proceeding.
The appellant argued that the certification judge erred in concluding that there was no cause of action against the town.
Dewey submitted that the certification judge had mischaracterized what was pleaded when he concluded that the town did not owe the class a duty of care to implement a policy to address the water problems.
He submitted that the pleadings alleged that the town had policies in place and had adopted measures and taken decisions to deal with the water problems but that the town was negligent in carrying out its policies in responding to the flooding problem.
The court accepted this argument and held that the certification judge’s finding that it was plain and obvious from the pleadings that there was no duty of care constituted an error in principle.
Justice O’Brien held that it was not plain and obvious that the pleadings disclosed no reasonable cause of action.
The judge noted that the appellant had pleaded that the town knew about the flooding problem, had made assurances that it would deal with the problem, and was negligent in actions it took or failed to take with respect to the flooding, which caused damage.
“The facts pleaded describe a ‘close and direct relationship’ based on the ‘expectations, representations, reliance and the property or other interests involved’ ... In my view, the pleadings respecting the proximate nature of the relationship between the Town and the class members satisfy the section 5(1)(a) requirement,” the judge wrote.
The court also found that the certification judge’s preferable procedure analysis under s. 5(1)(d) was premised on the fact that the class size had been determined, when it had not.
Justice O’Brien noted that the certification judge’s finding that joinder would be preferable to a class action was based on his misapprehension that the class size had been determined and that it would be small.
“However, the class size had not been determined or agreed upon, and there was conflicting evidence in the record on this point. There was evidence that the class size could be significantly higher than the 20 class members identified by the Judge,” the court observed.
Justice O’Brien concluded that the appellant had met the requirement of s. 5(1)(d) to show “some basis in fact” that a class action would be the preferable procedure and certified the action as a class proceeding against the respondents.
In a release, counsel for the appellant, Madeleine Carter of Wagners, said that the decision indicated that environmental class actions can be viable and must not be categorically denied.
“This is a big victory for the community on whose behalf Mr. Dewey has tirelessly advocated. We’re committed to moving ahead to the trial,” she said.
Raymond Wagner and Peter McVey of Wagners and Stephen Barnes of Buckingham Law also acted as counsel for the appellant.
Counsel for the remaining parties were not immediately available for comment.
Counsel for Corner Brook Pulp and Paper Ltd. were F. Richard Gosse and Elliott Bursey of Сox & Palmer.
Counsel for the Town of Deer Lake was Stephen Penney of Stewart McKelvey.
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