Ontario court hears HBC's request for review of regulations keeping retailer closed

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A lawyer for Hudson's Bay Co. says Ontario regulations that force some retailers to close while others that sell similar merchandise are allowed to remain open are “irrational and arbitrary.”

The province's regulations make no “rational distinction” between department stores and some big box and discount retailers, Jonathan Lisus told a video hearing with the Ontario Superior Court of Justice on Thursday.

He said there are hundreds of chain retail stores open for business that look “just like HBC” with the sole distinction that they sell an unspecified, undefined amount of “so-called” groceries.

Lisus noted, for example, that Walmart and Costco sell very similar products to HBC, while the majority of goods at discount retailer Dollarama are non-essential with its food offerings consisting mostly of candies, sweets and some canned goods — not fresh groceries.

"HBC is not here to take issue with the important objective of pushing back the pandemic or to point fingers at other retailers," he said.

"It's here to say the distinction that has been drawn is irrational and unfair."

HBC has asked the court to review the province's decision to temporarily close non-essential retailers in Toronto, Peel region and more recently the regions of York and Windsor-Essex.

Crown lawyer Richard Ogden told the court the regulation seeks to balance emergency needs during a pandemic with economic activity.

He said the regulation is "entirely consistent" with the purpose of the Reopening Ontario Act and is therefore valid.

"HBC has a burden to prove invalidity and has not met that burden," Ogden argued. "There is ample public health … advice that people should minimize non-essential trips."

He said that while retailers such as HBC cannot allow shoppers into their stores "they can remain open."

"They can operate with curbside pickup or online delivery," he said. "These designations are policy choices, which have been made by the government as part of a balancing exercise."

Hudson's Bay has 16 stores closed to in-person shopping in the affected regions.

"Hudson's Bay is the only entity that has the industry classification of department store general merchandiser … that is excluded by this regulation," Lisus said.

"This really is a unique-to-HBC issue."

Still, the department store has banded together with smaller retailers to object the regulations.

In a letter to Premier Doug Ford, a coalition of about 50 retailers including HBC argued the policy pushes more consumers to big-box and discount stores.

Justice Michael Penny said the court would reserve judgment, but that the judges considering the matter are "acutely aware of the need for expedition."

This report by The Canadian Press was first published Dec. 17, 2020.

Brett Bundale, The Canadian Press