OTTAWA — The Supreme Court of Canada will hear a case on whether a distributor is responsible for a franchisee’s losses during a food recall.
The top court has granted an application for leave to appeal by a class-action lawsuit representing Mr. Submarine Inc. franchisees against Maple Leaf Foods Inc. and Maple Leaf Consumer Foods Inc.
The case started after a 2008 recall when Toronto-based Maple Leaf pulled roughly 200 products due to a deadly listeria outbreak caused by contamination at one of its plants.
The franchisees say that they were bound by an exclusive supply arrangement to purchase ready-to-eat meats through Maple Leaf from a distributor and dealt with a six- to eight-week product shortages, as well as reputational injury and product losses.
The Ontario Court of Appeal ruled in favour of Maple Leaf in April 2018 that the duty to supply a product fit for human consumption is to the customers and not the franchisees.
Peter Kryworuk, a lawyer for the franchisees, said he was pleased by the top court’s decision to hear the appeal and that he expected the case will be heard later this year.
The counsel listed for Maple Leaf Foods did not immediately responded to a request for comment.