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B.C. Tables Cost-Recovery Legislation to Sue Corporate “Wrongdoers” for Harms or Risk of Harms Caused by Products or Services

March 15, 2024

On March 14, 2024, the British Columbia government introduced Bill 12, the Public Health Accountability and Cost Recovery Act (Bill or Act), for the stated purpose of enabling the government to sue “wrongdoers” to recover government health care costs and expenditures from corporations if goods or services sold or promoted by them cause harm or create a risk of harm, including addiction, problematic product use, or a general deterioration of health. The introduction was followed by the Premier’s news release and a press conference stating that this legislation “will provide the tools” for the government to pursue claims for the “costs associated with the promotion, marketing and distribution of products that are harmful to adults and children in British Columbia.” The Bill is scheduled to be debated at second reading when the B.C. legislature reconvenes on April 2.

Key Provisions

If passed in its current form, the proposed legislation could have significant consequences for companies — and their directors and officers — that provide goods and services in B.C. and elsewhere in Canada, or that have done so in the past. Notable features of the proposed legislation include the following:

  • A right for the B.C. and federal government to recover the cost of “health care benefits” for “health-related wrongs” in respect of any good or service. The Bill provides the B.C. and federal governments with a cause of action against any person who causes or contributes to a “health-related wrong” — a defined term that includes a breach of a common law, equitable or statutory duty or obligation, or a tort that causes or contributes to “disease, injury or death.” “Health care benefits” includes government expenditures for programs, services and benefits associated with “disease, injury, or illness,” which includes physical or mental injury or illness, problematic product use, addiction, general deterioration of health, or the risk of disease, injury or illness. 
  • Joint and several liability of directors and officers. In addition to companies, directors and officers may personally be held jointly and severally liable, whether or not an action against the corporation for recovery of the cost of health care benefits has been commenced or concluded. 
  • Retroactive effect and no limitation periods if action commenced within 15 years. The Bill provides for retroactive effect and that an action can be brought by the provincial or federal government arising from a “health-related wrong” whenever the health-related wrong occurred. Further, the Bill provides that no action commenced by the B.C. or federal government within 15 years of the coming into force of the Act or discovery of a claim is barred under the Limitation Act. Prior settlements are not a defence.
  • Significant procedural advantages to the government in proving its claim. The Bill includes presumptions in favour of the government and evidentiary provisions that make it easier for the government to pursue its claims. For example, the Bill permits a minister of the government to issue a certificate that is “conclusive proof of the cost of health care benefits” that have been provided and will likely be provided.    
  • Class proceedings. The Bill provides that the B.C. government may seek to bring a class action claiming cost recovery from companies on behalf of all provincial, federal and territorial governments in Canada.

The Province’s Immediate Targets

The Province’s news release and press conference identify the immediate targets of the Bill. The Premier announced that the Act will allow the B.C. government to “go after social media companies for the harms their algorithms cause people, especially kids.” But the Bill as drafted potentially applies to a wide range of goods and services. The Province’s announcement made clear that, if passed, this Bill will have broader application. The Premier’s office has stated that it will apply to companies producing allegedly addictive products, and the Attorney General further stated that it is a “powerful tool” in the government’s “toolkit” to hold companies accountable across Canada.  

Key Takeaways

The Act, if passed in its current form, creates a new governmental cause of action that purports to discard many foundational tort law principles and has the potential for an unprecedented expansion of liability for government costs and expenditures related to past and future products and services that the B.C. government alleges are harmful. Although the Province’s immediate targets appear to be social media companies, this legislation is not limited to social media. It potentially applies to any good or service, if it can cause or contribute to injury or illness, a deterioration of health, problematic use, addiction, or increased risk of harm. It could have far-reaching implications for companies in the technology, food, beverage, health and pharmaceutical, gambling, manufacturing and resource industries, among many others. 

The Bill is scheduled to be debated at second reading when the B.C. legislature reconvenes on April 2, and we are monitoring its progress. 

If you would like to discuss the draft Bill or its implications, please contact:

or any other member of our Litigation & Dispute Resolution group.