A judge has struck down a $1.1-million union lawsuit aimed at stopping Ontario from selling shares in Hydro One, saying it is the right of a government to set policy.

The legal action, spearheaded by the Canadian Union of Public Employees Ontario president Fred Hahn , is “an impermissible attack on a core policy decision,” Justice P.J. Cavanagh of Ontario Superior Court of Justice ruled in a 23-page decision.

“The claim should be struck out and the action dismissed.”

Lawyers for CUPE and the government laid out their cases during a one-day hearing in June as to whether the lawsuit should be allowed to proceed, even though the government had already sold all virtually all the intended shares in the utility.

Crown counsel warned that sending the case to trial would open the floodgates to legal challenges of government policies.

The union, which filed the misfeasance suit in December, described Hydro One as a “vital asset” that the government had “no mandate” to sell.

CUPE also alleged the share sale was “part of a fundraising scheme” for the Liberals because a fundraising event held just weeks after the initial public offering of stock was attended by major players in the investment industry. The provincial integrity commissioner found no wrongdoing in the fundraisers.

Premier Kathleen Wynne’s government decided to sell up to 60 per cent of the province’s shares in Hydro One to raise more than $9 billion to pay down hydro system debt and raise money for transit projects and other infrastructure.

Ontario still owns 49.9 per cent of Hydro One, but that would fall to 42.2 per cent if First Nations act on an offer to purchase shares.

Cavanagh said in his decision released Monday that the share sale is “explicitly permitted” under the Electricity Act, which government lawyers had noted was amended two years ago to facilitate the sale of shares.

The lawsuit named Wynne, Finance Minister Charles Sousa and Infrastructure Minister Bob Chiarelli, who was energy minister when the plan to sell shares was first announced.

Polls have suggested about 80 per cent of Ontarians opposed the sale of Hydro One shares, preferring full ownership to remain in government hands and a steady stream of dividend income from it boosting provincial coffers.

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