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HBC Writes Letter Challenging Government Measures

On December 1, 2020, Hudson’s Bay Company (“HBC”) led a charge to challenge the Ontario government’s order that all non-essential businesses in Toronto and neighbouring Peel Region close in an effort to contain surging COVID-19 infections.

In an open letter to Premier Doug Ford, HBC and almost 50 other retailers stated:

“We ask that you move immediately to open all retail in Ontario, and impose a 25% capacity limit on ‘non-essential’ retail in lockdown regions, just as several other provinces have done, all with guidance and support from public health officials. This will put fewer people in more stores, increasing safety for all. The current policy does the opposite. 

Together with mandatory mask policies, social distancing, hand sanitization and the numerous other safety measures already in place, capacity limits can further reduce the potential for community spread while enabling more businesses to stay open across all regions during a make-or-break season for retail businesses.

Large and small retailers need each other to create a vibrant retail ecosystem. Collectively, we are asking that you join with us in common cause and a shared commitment to keeping Ontario families safe and secure through this extraordinarily challenging period.”

The letter noted that Ontario’s policy of segregating “non-essential” retailers from those deemed essential might actually be making things worse, arguing that closing down the Toronto and Peel regions had not reduced the number of shoppers, but instead had funnelled those shoppers and the corresponding health risk into fewer, increasingly crowded stores, as well as adjacent communities. The letter also noted that “Canadian retail businesses are being destroyed and tens of thousands of jobs are being lost.”

HBC Goes to Court Over COVID-19 Measures

Additionally, in mid-December 2020, HBC applied to court asking it to review the province’s decision to temporarily close non-essential retailers in Toronto and Peel Region.

As reported by the CBC, HBC filed a judicial review in which it called the province’s approach “unreasonable” and “unfair” and asked it to recognize that there was a need for a solution that prioritizes health and safety without jeopardizing the livelihood of thousands of retail workers and the future of many businesses.

HBC’s court filing stated that “[a]lthough purportedly designed to maintain the public’s access to essential goods and keep non-essential retailers closed, the regulations do not do that.” It also claimed that the current regulations were incoherent and devoid of logic and consistency. Finally, HBC claimed that the government had changed its regulations to force department stores to close without notice.

Court Refuses Other Retailer’s Request for Interim Relief

We had previously written about an Ontario case, in which a court refused to allow a retailer to remain open pending a full hearing, after it was forced to shut down by the government due to the COVID-19 pandemic.

The retailer had commenced proceedings challenging shutdowns of several of its showrooms due to COVID-19 government measures. It challenged the measures by claiming that its hardware stores were exempt from mandatory closure under the express terms of the applicable regulation. The retailer argued that under the federal government’s definition of essential services retail workers engaged in the chain of commerce of home appliances were classified as providing essential services.

While awaiting the hearing on the main issue, the retailer sought temporary relief to keep its showrooms open, but the court refused the request.

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Baker & Company has adopted all of the COVID-19 safety precautions and vulnerable employees have been invited to work from home. We are fully operational and continue to work on client assignments. Where possible, meetings are being held via video link or by telephone conference.

At Baker & Company, we provide responsive, strategic, and pragmatic business and legal solutions to our clients. Our corporate and commercial law team has dealt with all kinds of issues in courts across Ontario and has significant experience at both the trial and appellate levels. To hear more about how we can help, call us at 416-777-0100 or contact us online.

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