A federal court has ruled that Ottawa breached the Canadian Wheat Board Act by not holding a plebiscite among farmers before making changes to the long-running system.
Agriculture Minister Gerry Ritz introduced legislation in October that ended the Board's monopoly on Western wheat and barley.
But Judge Douglas Campbell, who released the decision on Wednesday, said that Ritz needed the consent of farmers to change the decades-old system, because of the "unique democratic nature of the CWB."
"I find that the act was intended to require the minister to consult and gain consent," wrote Campbell.
Shortly after the ruling, CWB chairman Allen Oberg said that Ottawa should respect the federal court decision and scrap the proposed changes.
Still, a defiant Ritz said the government will not back down.
"We will proclaim it into law before the end of this year to bring certainty and clarity to farmers, to the industry overall and to, of course, our customers domestically and abroad," Ritz said.
"We want this in place so that farmers can take advantage of it and make use of the coming crop year August 1st of 2012. Nothing has changed."
The argument centered upon section 47.1 of the Act, which was written to ensure that "farmers, not government, would be in control of any future change to the (CWB's) marketing authority," said the judge.
NDP MP Pat Martin said that the Conservatives actually promised farmers before the previous election that they would hold consultations before making any changes.
Plus, Martin added that the judge went as far to offer damages to the CWB lawyers for court costs.
But in the meantime, Martin wondered what could occur if the legislation remains in flux during next year's harvest.
"If they plough ahead and this gets struck down, they're going to throw uncertainty into the whole rural … economy," Martin told CTV's Power Play. "We have to find a way to sell 20 million tons of grain next fall, and we don't know how it's going to be done because of the recklessness of the government."
Liberal MP Ralph Goodale, who participated in drafting the Canadian Wheat Board Act, agreed that Ritz's actions were "an affront to the rule of law."
He added that section 47.1 of the Act clearly stated that no changes could be made without consultation with producers.
The Conservative legislation is currently part-way through the Senate, said Goodale, who is a Saskatchewan MP.
The CWB was set up during the Great Depression as a way for farmers to band together and demand higher prices for their crops. But critics of the board say it is out-dated and monopolistic.
Alberta Conservative MP Chris Warkentin said that the government will press on with the bill, despite the ruling.
"We are going to continue to move forward to ensure that farmers do have the freedom that they've long sought."
