The Federal Court of Appeal heard arguments Wednesday in the federal government's appeal of a ruling that found its introduction of legislation to revamp the Canadian Wheat Board broke the law.

Wednesday's hearings began with a failed attempt by the Friends of the Canadian Wheat Board advocacy group and others, including former wheat board directors, to quash Agriculture Minister Gerry Ritz's motion to appeal. The court ruled the appeal could proceed.

The federal government is appealing a ruling last December that found it was violating the original Canadian Wheat Board Act by dismantling the board's monopoly on sales of Prairie wheat and barley without first consulting affected farmers in a plebiscite.

That ruling did not stop the Conservatives from passing its law in December and changing the wheat board to a voluntary agency for producers.

Supporters of the former system argued Wednesday that the Harper government was now trying to "have its cake and eat it too."

"If the government thinks that the ruling on Dec. 6 was meaningless, why are they appealing this decision here today?" former wheat board chair Allen Oberg said outside the courtroom.

Oberg and the other farmer-elected directors on the wheat board were dismissed by the Conservative government after its law took effect, mere days after the Federal Court's ruling in Winnipeg.

The board is now run by only government appointees, and Prairie wheat and barley farmers can start selling their wheat on an open market later this summer.

"What we're asking for is [for] the government to either give farmers a democratic vote on the future of the Canadian Wheat Board, which is what they were originally promised, or if they're not willing to do that, compensate farmers for what they have lost," Oberg said.

Oberg noted that when the farmer-elected majority on the board decided to hold its own producer plebiscite before the legislation was passed, 62 per cent of Prairie wheat farmer said they wanted to keep the monopoly system. 

Minister 'thumbed his nose at the court'

John Lorn McDougall, the lawyer for the former directors, argued Ritz ignored the Federal Court's ruling by going ahead with legislation to dismantle the wheat board's monopoly.

"He simply thumbed his nose at the court," McDougall said.

A government lawyer said Ritz did no such thing.

Stewart Wells, another farmer-elected board member dismissed by the government last December, said that while Conservative MPs were elected across the Western provinces in 2011, that doesn't mean producers didn't want to be consulted before changes were made to the wheat board, as required by the Canadian Wheat Board Act.

"Farmers, when they went to the polls last May 2 … relied on this legislation as their safety net," Wells said, referring to the requirement to hold a vote first.

Wells said the Harper government has been "reckless and irresponsible." 

"Surely in this country we can't allow governments to act that way," the former director said.

A spokesman for the Friends of the Canadian Wheat Board group said that if the federal government wins its appeal, the group is prepared to take the case to the Supreme Court.

In a statement sent to reporters after the hearing wrapped up, Ritz said, "we are confident that the court will see the merits of our case."

The Federal Court judge reserved decision following Wednesday's arguments.

Historic change

Wheat and barley farmers in Western Canada have been required to sell their grain through the board since the 1940s.

The Conservatives long promised to allow farmers the option of independently selling their grain, as their counterparts do in other regions.

The move has the support of many farm groups, who say producers can often get better prices on the open market.

But supporters of the monopoly say the open market will leave farmers at the mercy of railways and big, international grain companies.

They argue the monopoly prevented producers from competing against each other for sales.

On the eve of the hearings, Ritz signalled Tuesday that the government was continuing with the process of implementing what it calls "marketing freedom" for the grain sector.

Draft regulations published this week name the Alberta Barley Commission as the new administrator for a voluntary producer "check-off" scheme, to fund research, market development and technical assistance for the western Canadian grain industry now that the wheat board will be a smaller, voluntary organization.

The voluntary check-off is deducted from producers' payments when they deliver their crops for sale.

"With the global economy still very fragile, strengthening Canada's economy continues to be our government's primary concern," said Ritz in a press release.

"The check-off will help the western grain industry to grow, increase profitability at the farm gate, and create a bright future for the Canadian economy."

With files from The Canadian Press