Twitter Updates
Search
Tuesday
Mar302010

March 2010

I'd apologize for the long delay between blog postings, but keeners know the quickest way to get your class action news is now through Twitter at www.twitter.com/wbranch99 Sure, Ashton Kutcher has 4.6 million more followers than I do, but it's still cutting edge, right?

CERTIFICATION

Nette v. Stiles, 2010 ABQB 14: Court refused to certify proposed chiropractic class action on all grounds. The writer was counsel for defendant College of Chiropractors. In particular, the court found that the College did not owe a private law duty of care to chiropractic patients. The court distinguished Finney and Sauer as follows: "Finney is not authority for the proposition that the Supreme Court of Canada abandoned the Cooper-Anns test in determining duties of care. ..Sauer v. Canada (Attorney General), 2007 ONCA 454 was a case arising from mad cow disease infecting Canadian cattle herds. The Ontario Court of Appeal refused to strike out a claim against the Federal Crown respecting its regulation of cattle feed. At para. 62, the Court observed that in making public representations to Canadian farmers about the quality of cattle feed, the Federal Government may have created a duty of care to farmers in an operational sense contrasted to duties of care owed to the public at large. Thus it was not plain and obvious that the claim should be struck out. In this case, the AASOC does not plead that there was any relationship between the Plaintiffs and ACAC, nor is it pled that the Plaintiffs made any complaint to ACAC about Dr. Stiles. Moreover, it is not pled that the Plaintiffs had any form of communication with ACAC. The factual situation in this case, accordingly, is not analogous to the situations in Finney or Sauer, and on a generous reading of the pleadings, there is no duty of care which could be owed by ACAC to the Plaintiffs arising from any course of dealings as none ever existed." (at paras 34-38)

Gary Jackson Holdings Ltd. v. Eden, 2009 BCSC 1582 (pre-certification preservation order); 2010 BCSC 273: Certification dismissed of developer trust fund case. The writer's firm was counsel for the Defendant Eden, although Brad Dixon of BLG on for the co-defendant deserves all the credit for the result. The court found that the case failed at the preferable procedure level given the primacy of the individual defences of knowledge and consent, acquiescence, ratification and estoppel. The court also stated "In determining the question of whether other means of resolving the claims are less practical or less efficient, as stated s. 4(2)(d) of the Act, it is worth noting that there are only 15 or 16 potential members of the proposed class. I am not persuaded that there will be savings to the proposed class members from certification of the proceedings under the Act that cannot be realized if those individuals are simply joined as co-plaintiffs in this action."

Collectif de défense des droits de la Montérégie (CDDM) c. Centre hospitalier régional du Suroît du Centre de santé et des services sociaux du Suroît, [2009] J.Q. no 16938 (S.C.): Case involving use of restraints and other abusive conduct at a mental institution refused certification. The court found that there were no common issues, and no serious appearance of a cause of action. The court held that the action really called for a "commission of inquiry". Another example of Quebec's turn away from their love affair with class actions, since these types of cases have been certified in the common law provinces.

Alves v. First Choice Canada Inc., 2010 SKQB 104: Bad travel class action refused certification.

Singer v. Schering-Plough Canada Inc., [2010] O.J. No. 113 (S.C.J.): Certification refused in a proposed class action against sunscreen manufacturers for false advertising and labeling. In refusing certification, the court determined that the plaintiff had failed to make his case on many fronts, including failing to plead a proper cause of action, not identifying common issues capable of certification, not providing evidence of an identifiable class, and failing to show the class action would be the preferable procedure.

Certification was granted in the price fixing case Pro-Sys Consultants Ltd. v. Infineon Technologies AGFN, 2009 BCCA 503.

Certification was granted in a negligence and breach of fiduciary duty case grounded in a private law duty of care brought on behalf of a class of status Indians against the Crown related to harm from exposure to toxic mould in reserve housing: Grant v. Canada (Attorney General), [2009] O.J. No. 5232 (S.C.J.)

Acreman v. Memorial University of Newfoundland, 2010 NLTD 4: Employment benefits case certified.

Robinson v. Rochester Financial Ltd., [2010] O.J. No. 187 (S.C.J.): An allegedly flawed tax shelter claim was certified. The court certified a punitive damages issue (contrary to the recent finding in Robinson v. Medtronic Inc., [2009] O.J. No. 4366) by confirming that the issue would only be considered after the level of individual damages was established. The author agrees with this approach. The court held that appeals to the Tax Court were not a preferable procedure as "This raises concerns about staying this action in favour of a lengthy and uncertain outcome in another forum that has not yet begun and that Banyan Tree has told donors will be litigated all the way to the Supreme Court of Canada and "will take years to clear the courts.""

Holland v. Saskatchewan, 2010 SKQB 32: Case certified involving proposed class of commercial game farmers who allegedly have suffered economic loss as a result of the conduct of the defendant in administering the Saskatchewan Cervid Chronic Wasting Disease ("CWD") Surveillance and Certification Program. The court rejected a common issue asking whether class members suffered damages, holding that this must await individual hearings. The court did order that the potential for aggregate damages could be certified as a common issues as there was "more than a possibility" that such an award could be made.

Jellema v. American Bullion Minerals Ltd., 2009 BCSC 1605: Oppression claim refused certification on the basis that s.227 of the B.C.'s Business Corporations Act permits a representative action, and that hence s.41 of the CPA prevented a class proceeding. The court distinguished the contrary approach established in Stern v. Imasco 1 BLR (3d) 198 (Ont.S.C.J.) stating that "Section 241 of the CBCA does not explicitly or by implication provide that a shareholder may allege oppression or prejudice in relation to the complainant and other shareholders, or seek relief on their behalf....Section 227(2) of the BCA, on the other hand, explicitly authorizes a shareholder to apply to a court for relief on the ground that the affairs of the company have been conducted, or the powers of directors are being or have been exercised, in a manner that is oppressive "to one or more of the shareholders, including the applicant", or on the ground that some act of the company has been done or is threatened that is unfairly prejudicial "to one or more of the shareholders, including the applicant". But for this problem, the claim would have been certified.

Jacques c. Petro-Canada, 2009 QCCS 5603: Gas price fixing case certified. The court did cleave the class into 4 distinct local markets. The court noted that this claim involved direct purchasers. (para.101) The court distinguished Harmenigies v. Toyota on the basis that the product here was homogenous. The court found that was not essential to demonstrate an individual loss, but the demonstration of a collective loss by a credible method for determination of damages is acceptable (para.135). The court found that a contractual relationship with each defendant was not necessary in this case, as there was a "legal relationship" with the alleged conspirators. (para.263)

Spurr v. Canada,, 2009 SKQB 478: Proposed class action for alleged exposure to chemical compounds on certain military bases in Alberta and Ontario was rejected. The Charter claim was struck due to a lack of specificity as to what legislation was being challenged. On class definition the court stated "The plaintiffs have not identified any objective criteria that applies to the word "testing", and the result is a subjective definition that will not be objectively determined prior to the outcome of the litigation. Persons receiving notice will not know what is meant by the word and whether or not they have a claim. Persons could quite reasonably say, "I wasn't tested; I was trained". In this opt-out jurisdiction, persons will not know whether they should opt out, which persons may wish to do, for among other reasons, they are presently receiving a pension pursuant to s. 21(1) of the Pension Act and do not wish to jeopardize it. There is also an issue of whether the class definition offered is one class or multiple classes, but this issue is better dealt with under s. 6(1)(c) on whether the claims of the class members raise common issues. The plaintiffs have failed to satisfy the requirement there is an identifiable class that does not depend for its criteria for membership on the outcome of the litigation, and as a result, the proposed class has the potential to be unreasonably over-inclusive" (paras.50-52)

On common issues the court stated "With respect to the common legal issues put forward, for the legal issues to be common there must be some common factual issues. The only common factual issue put forward is whether the plaintiffs were exposed to substances, which the defendant admits they were. This most general factual issue will not advance the litigation, or assist in determining whether liability will attach to the defendant in any of the varied circumstances that are alleged."

On preferable procedure: "[T]here are no common issues which advance this litigation, and the individual issues that would be present in any event are formidable. These include the matters of medical causation and assessment of personal injury damages, limitation periods, and the jurisdictional limitations set out in the Pension Act, supra, and the Crown Liability Act, supra."

On representative plaintiff: "I have earlier listed excerpts from the cross-examination of Mr. Heidt, which examination establishes he does not meet the criteria for a personal representative set out in s. 6(1)(e)(i). His ex-amination indicates he has no knowledge of the litigation process, nor does he appear to have much, if any, interest in being a representative plaintiff. He was quite clear he is more interested in pursuing his personal claim. There is nothing in the material that suggests that he would fairly and adequately represent the interests of the class. With respect to the criteria set out in s. 6(1)(e)(ii), which requires the representative plaintiff to produce a plan for the class action that sets out a workable method for advancing the action, no plan was produced. Counsel for the plaintiffs took the position that such a plan can be worked out following certification before the person designated as the management judge. No good reason was offered why the requirement that the representative plaintiff should produce a plan as required by s. 6(1)(e)(ii) of the Act, and is a requirement in Rule 82(2)(e) of The Queen's Bench Rules, should not be complied with."

Brooks v. Canada, 2009 SKQB 509: Gagetown Agent Orange case denied certification. The court relied heavily on the denial of certification in the New Brunswick case Bryson v. Canada, 2009 NBQB 204. The court admitted an opinion from a "expert" on limited grounds: "For this stated limited purpose, and for these principled based reasons, I am prepared to admit Dr. Sears' affidavit, not as an expert opinion, but rather to identify some of the information that "is out there" to assist the plaintiff in its future attempts to convince the court that the class and its membership as well as the common issues proposed has some arguable foundation in science and medicine." The court accepted there was a cause of action, except for the medical monitoring claim, following the conclusion in Bryson. The court found that the claim for monitoring was an improper claim for pure economic loss.

The court found that the proposed class was not appropriate stating: "when one carefully examines the proposed class definition, it is not even proscribed by any qualification that the individuals have come into contact with "Toxic Area(s)" or that they have suffered or experienced adverse health effects or desire the relief outlined in subparagraph (d) of the certification application. The approach taken by Barry J., the certifying judge in the Ring, supra, Newfoundland action, was to narrow the already much narrower proposed class definition (persons suffering from lymphoma) from "all individuals who were at CFB Gagetown between 1956 and the present" by adding the words "and who claim they were exposed to dangerous levels of dioxin or HCB while on the Base""

The court found no common issues: "Questions (i), (iii) and (iv) would simply go to establishing whether or not the chemicals whose use at CFB Gagetown over the 50 years the plaintiff complains of were used and when, where and in what quantities. It might also answer the question of whether or not these circumstances created "toxic areas" that presented unusual or unreasonable danger "of causing adverse health effects in humans". These issues, as framed, are so general that their determination would provide little or no help to advance the claims of the proposed class members." (at paras 156-7).

The case failed on preferable procedure was well. Notably the court commented on behaviour modification in terms that surely warm a Justice lawyers' heart: "178 Insofar as the goal of behaviour modification is concerned, it is noteworthy that the defendant in this case is the Government of Canada. As is evidenced by the defendants' support for and payment of the fact-finding project, the defendant must be given credit for its sincere determination to ensure that any and all persons coming into contact with CFB Gagetown have a safe environ-ment. As the materials evidence, representatives of the defendant have participated in public meetings and supported numerous investigations and inquiries in respect of the concerns that have been raised not only affecting the members of the proposed class but indeed, all members of the public in New Brunswick in the vicinity of or visiting CFB Gagetown. I have concluded that the objective of behaviour modification is not a compelling argument in this case".

On the rep plaintiff, there was an interesting comment on the interaction with the Newfoundland litigation: "He was, and is, a plaintiff in the Ring action (supra), in Newfoundland but has undertaken that if the Saskatchewan action is certified as applied for, he will opt out of that action in favour of pursuing the Saskatchewan certification and claim. I am persuaded that he would fairly and adequately represent the interests of the class proposed nor does he have, on the common issue, an or any interest that is presently identifiable that is in conflict with the interests of the other proposed class members" (at para.183). However, the court found that no proper plan had been submitted by Brooks or the other proposed plaintiffs.

The court commented on the multijurisdictional elements of the case: "The application for certification of the Bryson, action (supra) in New Brunswick has been dismissed. If I am found to be wrong with respect to my treatment of the Brooks application for certification as a class action, the possibility of avoiding the risk of irreconcilable judgments only ex-ists with respect to the Ring, supra, action in Newfoundland. Counsel for the plaintiff, Brooks, is also counsel for the plaintiff, Ring, in that action. Indications are that if the Saskatchewan action were to be certified as applied for, the Saskatchewan action would be proceeded with either solely or in a coordinated fashion with the Newfoundland action. It is also noteworthy to observe that the Newfoundland action involves a claim by persons suffering a specific condition although presumably issues of contamination and causation and the determination upon those issues would, or could be, equally applicable to the claims in both actions. Judicial comity may well additionally contribute to avoiding the risk of conflicting judgments or conclusions. For much the same reasons, and considering the same factors, judicial economy may well be advanced by litigating, in priority, one or the other of the actions. That alone, in my view, would not prefer the Newfoundland action over that proposed for Saskatchewan. It is noteworthy that the defendant and third parties propose that it would be New Brunswick that would be the preferable venue for the trial of any class action based upon the claims and damages alleged in this action. Since that certification has been rejected, and subject to any appeal and the results of it, that option is no longer available." (at 201-202) "...with the advanced nature of air transportation, technology available for information transfer and otherwise modern reproduction and electronic discovery, the court is satisfied that the issues in this case could as conveniently and appropriately be tried in Saskatchewan as anywhere else in Canada. On the whole, the court would be satisfied that Saskatchewan is an appropriate jurisdiction for the trial of this class action as a multi-jurisdictional one representing any and all persons except those subject to the exceptions stated in the application for certification or having opted out as provided for by the Act. (See also the discussion of the Manitoba trial and Appeal Court in Ward, supra). Accordingly, I would conclude that there is no preference to be given to any of the class actions commenced in any of the other provinces in Canada over this Brooks action in Saskatchewan. Had I certified this class action, which I have not, I would have done so as a multi-jurisdictional one." (at paras.205-207). The court declined to rule on the constitutionality of the Saskatchewan regime.

Ring v. Canada, 2010 NLCA 20: Newfoundland Court overturns the only favourable Agent Orange certification, again relying in large measure on the reasoning in the New Brunswick Bryson decision. .

Gautam (c.o.b. Cambie General Store) v. Canada Line Rapid Transit Inc., 2010 BCSC 163: Nuisance class action regarding construction of rapid transit line certified. Unlike some of the other nuisance claims that have been rejected, the court found "The defendants do not plead that the effect of construction varied from place to place in Cambie Village. Indeed, there is little in the record on this application to suggest that the impact of construction on access to the properties and businesses in Cambie Village differed markedly from location to location along Cambie Street." Further, the court found that the plaintiffs had proposed a reasonable mechanism to address the individual aspects of the nuisance determination stating: "The plan proposes that in the event the court determines that there was substantial interference with access, the question of whether the impact was unreasonable as regards any owner or business will be determined with the assistance of an assessor in the manner contemplated by s. 27 of the CPA. The defendants argue that assessment of the impact is at the core of the action. They say that the assessment will depend on the type of business, the effect of location on sales, the nature of the customer base, the manner in which customers made their way to the business, the sensitivity of the clientele, the effect of other market forces on business performance, and the efforts made by the business to adjust to construction in order to mitigate losses. With respect, this statement of requirements overlooks the fact that the principal evidence of loss will be a reduction in revenue during construction. The assessor's concern will be to quantify the loss and to consider whether any loss was attributed to factors other than construction. Upon receipt of the assessor's report, the court may determine whether the amount of the loss sustained by any member of the class because of construction rather than some other cause was unreasonable in the circumstances." The court also certified the entitlement to waiver of tort remedy as a common issue. The court rejected a competing multi-plaintiff action as a preferable procedure stating: "In my opinion, a multi-party action is less practical or less efficient than a class proceeding in so far as the owners and merchants in Cambie Village are concerned. Each plaintiff in the multi-party action will be obliged to adduce evidence peculiar to that plaintiff because the owners and merchants are separated in location and few, if any, own or operate from adjacent properties. The evidence will be more complex and voluminous as a result than will be the case with the class proceeding which asserts a claim on behalf of all in the Cambie Village area."

F.L. c. Astrazeneca Pharmaceuticals, p.l.c., [2010] J.Q. no 1012: A proposed Seroquel drug class action was denied certification on the basis that the causation issues were dominant. The court also found that the Sale of Goods Act like claims should be dismissed as the strict liability regime thereunder did not fit well with the idea that drug manufacturers can only be expected to exercise reasonable diligence in identifying possible adverse reactions. The court found that there was no real allegation of improper warnings.

Smith v. Vancouver City Savings Credit Union , 2010 BCSC 120: Overdraft class action certified.

King v. Canada, 2009 FC 796: Pension case denied certification on the basis that there was no cause of action.

Brunelle c. Banque Toronto Dominion, [2009] J.Q. no 11102 (S.C.): Mortgage pre-payment case certified. The court also confirmed that the limitation period was suspended while an earlier motion for class certification was pending, up to the date it was discontinued.

D'Amour c. Bell Mobilité inc., [2010] J.Q. no 416: a proposed class action involving fixed term wireless contracts was rejected on the basis that there were gaps in the individual representative's cause of action.

Fournier c. Banque Scotia, [2010] J.Q. no 258: Financing charge class action dismissed based on cause of action requirement.

Beaver c. Capitale (La), assureur de l'administration publique inc., [2009] J.Q. no 16937 (S.C.): Class action certified where an insurance company adjusted the period during which premiums were waived.

Gordon c. Société Radio-Canada, [2009] J.Q. no 9666 (S.C.), a proposed class action involving allegations of comments that violated human rights was denied certification on the basis that measuring the effect of those communications would depend on the reaction of each individual, and that the proposed group was too diffuse to support a group libel claim.

Contat c. General Motors du Canada ltée, [2009] Q.J. No. 9155: Appeal of certification dismissal denied. Plaintiff did not have a strong enough cause of action.

THIRD PARTY FUNDING

Metzler v. Gildan (December 2, 2009) (Ont.S.C.J.): Court refused motion for reconsideration. Leave has been granted of original decision declining to approve proposed third party funding arrangement.

PAYDAY LOAN UPDATE

Bodnar v. The Cash Store Inc., 2010 BCSC 145. Settlement approved. The writer was counsel for the defendant.

Smith Estate v. National Money Mart Co. 2010 ONSC 1334: Settlement was approved of this class action. Of note 1. The value of the cash and credits was approximately $62.6M ($30.3M in cash and $32.3M in credits)2. The potential claim was said to be $150 million.3. Therefore the recovery in cash and credits would appear to be about 42% of the total claim 4. Moneymart was making an annual profit of $58 million, supporting a higher percentage. 5. Moneymart granted complete forgiveness to all customers. Plaintiff's counsel argued that that had an additional value of the book value of $56.3 million. While the court did not accept this, it did agree that it had some value (para.101)7. Any unused credits did not revert to Moneymart. Rather, there will be a future court order requiring a future reduction in fees to account for the unused credits. 8. The approved fee was $14.5 million. Class counsel had sought $27.5M.

Casavant v. Cash Money Cheque Cashing Inc., 2010 BCSC 148: Settlement approved.

Wournell v. 1152919 Alberta Ltd. and others, 2010 BCSC 145: Settlement approved. The writer was counsel for the defendant.

SECURITIES DEVELOPMENTS

Pysnyj v. Orsu Metals (March 4, 2010) (settlement approval): Settlement approved of secondary market case. Writer was counsel for defendants.

Silver v. Imax Corp., [2009] O.J. No. 5573: Certification granted in first secondary market case. Justice van Rensburg granted the plaintiffs leave to commence their claim, finding that they had met the statutory threshold to establish that they are bringing the action in good faith and that there is a "reasonable possibility of success at trial." Justice van Rensburg held that the good faith branch of the test requires plaintiffs to "establish that they are bringing their action in the honest belief that they have an arguable claim." In setting out a test that only a rare plaintiff will fail, she rejected the more robust good faith requirement that applies to derivative actions. She interpreted the "reasonable possibility of success" branch of the test as a relatively low threshold, holding that a reasonable possibility is more than a "mere" or de minimis possibility, and the conclusion that a reasonable possibility exists must be based on a reasoned consideration of the evidence, bearing in mind the limitations of motion procedure. Justice van Rensburg held that to defeat a motion for leave, a defendant must satisfy the court that the evidence will "preclude the possibility of success at trial." Only two external directors met this test. The court found that that the defendants could not rely on the business judgment rule as part of their reasonable investigation defence, because the business judgment rule has been held not to apply to disclosure obligations under securities laws. The court concluded that reliance on experts cannot be used as a defence where the misrepresentation does not originate with the expert or where the expert's opinion is based on misleading information that has been provided to it by the corporation. Consequently, she held that the defendants could not rely on the audit opinion of Imax's auditors.

The court certified the plaintiffs' statutory and common law claims for negligent and fraudulent misrepresentation. The court essentially accepted the efficient market argument, to the effect that reliance could be established by the act of purchasing the corporation's securities.

Although only approximately 10 to 15 per cent of the proposed class members were Canadian residents, Justice van Rensburg certified a global class, finding that there was a real and substantial connection to Ontario in light of the fact that Imax was an Ontario corporation trading on the TSX.

Sharma v. Timminco Ltd. 2010, ONSC 790: Court ordered production of insurance policies prior to certification.

Fischer v. IG Investment Management Ltd., 2010 ONSC 296: Market timing case not certified, as OSC settlement was preferable procedure.

Metzler Investment GMBH v. Gildan Activewear Inc., [2009] O.J. No. 5695 (S.C.): Application to strike unjust enrichment claim refused. Application to strike portions of affidavit refused.

Allen v. Aspen Group Resources Corporation, [2009] O.J. No. 5213 (S.C.J.): Court certified a securities class action in connection with alleged misrepresentations in the take-over bid circular. The court held that the class will include holders of securities tendered pursuant to the bid who were not resident in Ontario (the outside Ontario group). The circular contained a choice of law clause which provided that Ontario law applied, including the statutory code contained in Part XX of Securities Act. The court stated:

"In this case, permitting out of province shareholders to sue under the Securities Act, the court is not making an impermissible choice of law in conflict with constitutional principles. The parties themselves have made the choice of law and the court is entitled to respect that choice. Simply put, this Court has jurisdiction over the claims of these out-of-province shareholders because they have contractually attorned to its jurisdiction. Moreover, those out-of-province shareholders have, through a choice of law clause, agreed to the application of Ontario law to their claims. As such, there is no issue of extraterritoriality, either with regard to the Court's jurisdiction or with regard to the application of Ontario securities legislation to out-of-province shareholders."

JURISDICTION

Medvid v. Saskatchewan, 2010 SKQB 22: The court found that the principles of crown and sovereign immunity prevented the Plaintiff from suing the Province of Alberta in the courts of Saskatchewan. The writer was counsel for the Province of Alberta.

Stanway v. Wyeth Pharmaceuticals Inc., 2009 BCCA 592: The plaintiff claimed to have contracted breast cancer from a particular estrogen-based drug. She sued the six defendants in negligence, and under British Columbia's consumer protection legislation, saying they were individually and jointly responsible for the manufacturing, testing, marketing, labelling, distribution, promotion and sale of the drugs to consumers in British Columbia and elsewhere in Canada, and that they failed to warn her about the dangers of taking the drugs. Of the six defendants, one, "Wyeth", was a publicly-traded pharmaceutical company based in Delaware. Two others were also U.S.-based corporations, both wholly owned subsidiaries of Wyeth. The other defendants were two Canadian corporations and a general partnership comprised of those two. The three U.S. defendants applied for a dismissal order on the ground that the British Columbia court lacked territorial competence over them. The court held that there was jurisdiction. The CJPTA eclipses the former common law approach to jurisdiction simpliciter. The presumption of a real and substantial connection set out in s. 10 of the Act applies when basic facts, set out in s. 10(a) through (l), are pleaded. The tort of negligent manufacture will be taken to have occurred in the place where the damage was suffered regardless of where the wrongful conduct elements of the tort took place if the wrongdoer knew or ought to have known the defective product would be used in the place where the damage took place. As well, a failure to warn British Columbia consumers of a hazardous product is a tort committed in British Columbia, regardless of where the omission took place, if the defendant knew or ought to have known the product would be used in British Columbia. As to whether the U.S. defendants rebutted the presumption of real and substantial connections, the plea that the U.S. defendants were parties to torts committed in British Columbia presumptively established direct and significant connections between British Columbia and the facts on which the proceeding against the U.S. defendants was based. It was not necessary for the plaintiff to support those allegations with evidence except to the extent their truth was challenged by the evidence of the U.S. defendants.

DECERTIFICATION

Smith v. Inco Ltd. [2009] O.J. No. 5439 (S.C.): Defendant wished to apply to decertify at the end of the plaintiff's presentation of the evidence in midst of common issues trial. The Defendant had already brought a failed application to decertify 8 months prior to trial. The court declined to consider the motion until all of the evidence was presented. The court stated: "In my view the Hollick and Pearson decisions stand for the proposition that there is a low threshold to be met by the class representative on a certification motion because the action is usually in an early stage at the time of the certification motion, prior to examinations and prior to full documentary disclosure. However, as the action matures and evidence is revealed a party may ask the court to reopen the certification issue and more closely scrutinize the case as it relates to the criteria in s. 5 of the CPA....In my view most of the factors before me in this case favour a deferral of the hearing of any decertification motion until all of the evidence has been received by this court....[E]ven though the Supreme Court of Canada described the CPA as a "procedural tool", where a motion to decertify is brought at a later stage in a proceeding the court must logically consider more than merely the procedural aspects of the case. The court must also consider the evidence that has been revealed to date and the merits of the positions taken by all parties to the action. If a court were not permitted to consider the merits of the case as at the date of the decertification motion, then there would be no purpose in reconsidering the certification issue after examinations for discovery and full documentary disclosure. Therefore, I find that the court on a decertification motion must review all of the evidence as it has been revealed to that point in the proceeding."

The court drew parallels to a non-suit motion: "In Ontario a practice has developed as to the preferred manner of handling non-suit motions. The Ontario Court of Appeal commented on this practice in the case of Prudential Securities Credit Corp. [Indexed as: FL Receivables Trust 2002-A (Administrator of) v. Cobrand Foods Ltd.,] 85 O.R. (3d) 561. At paras. 13 and 14 of that decision the Court wrote: "Still, I question whether in this province a non-suit motion in a civil non-jury trial has much value. In Ontario, when a defendant moves for a non-suit, the defendant must elect whether to call evidence ... If the defendant elects to call evidence, the judge reserves on the motion until the end of the case. If the defendant elects to call no evidence ... then the judge rules on the motion immediately after it has been made. A non-suit motion adds to the time and expense of a trial. And because of the election requirement, it has little practical value ..." In my view the same comments can be made about decertification motions brought by a defendant at trial after the completion of the plaintiff's case. If the court must fully scrutinize the plaintiff's evidence to determine whether the criteria for certification have been proved, why not simply reveal all of the evidence and permit the court to make a final determination of all of the issues? In its final decision the court may still decide to decertify, or amend the certification, or amend the class. To embark on this exercise twice would not meet the objective of judicial economy. Still further, I accept that there may be an unfair tactical advantage to Inco if I were to hear and decide the decertification motion before Inco was called upon to present its case. That is, if I heard and decided the decertification motion, Inco would have the advantage of hearing or reading my views of the plaintiffs' evidence before Inco presented its case. Therefore, Inco could tailor its case to the expressed views of the trial judge. This point favours a deferral of the decertification motion. Also, I must keep in mind the objective of access to justice. Inco submits that even if the proceeding was decertified, access to justice would not be denied as any individual with a claim against Inco could still proceed with his/her claim. I do not accept Inco's submission on this point. Given the economies of a case such as this, in my view a decertification decision would effectively end all claims. No one individual could continue this claim on his/her own....I would like to note that the exercise of judicial discretion must be done on a case-by-case basis. It might be that in some other case a distinct procedural or technical issue may exist that should be dealt with by way of a decertification motion prior to the defendant being put to an election to call evidence. However, in my view that is not the case before me."

SETTLEMENTS

Martin v. Lahey, 2009 NSSC 331: Antigonish abuse class action settled. The writer was co-counsel for the defendant.

Boulanger v. Johnson & Johnson Corp.[2009] O.J. No. 4497 (S.C.): Prepulsid settlement approved. $8.75 million fund established including administration costs and fees. Administration costs were estimated at $750,000. Excess reverts to defendants. Structure paralled U.S. settlement. Final decision on fees was reserved until the take up rate was known. The settlement was approved concurrently in Quebec (Demers c. Johnson & Johnson Corporation, [2009] J.Q. no 12600), and other actions were being discontinued. Crawfords was appointed as administrator. Class counsel undertook to guide, advise and, where appropriate, formally represent class members through the process of finalizing the settlement, ensuring that the notice program is implemented and, thereafter throughout the course of the administration of the settlement. Court noted that US settlement only have 25 eligible claims with 75% of claims processed. Class counsel conceded that the did "not expect the take-up rate to be high". The manner of compensating public health insurers was still to be negotiated.

Burnett v. St. Jude, 2009 BCSC 1651: St. Jude heart valve settlement approved in B.C. over objectors' concerns with compensation for psychological injury.

Schweyer Estate v. Laidlaw Carriers Inc., [2009] O.J. No. 5399 (S.C.): Misrepresentation case settled. Case involved representations about value of an early retirement package. Settled for $750,000 following discoveries. Fee at 21% approved, which was less than time incurred.

Abdulrahim v. Air France, [2009] O.J. No. 5550 (S.C.J.): Partial settlement approved in price fixing case.

Option Consommateurs c. Banque de Montréal 2009 QCCS 4438 and 2009 QCCS 4485: Settlement approved. Goudreault c. Service Garantie Quebec inc., [2009] J.Q. no 13779: Financing class action settlement approved.

Cilinger c. Centre hospitalier de Chicoutimi, 2009 QCCS 4445: Delayed breast cancer treatment settlement approved.

Lamothe c. Canada (Procureur general), [2010] J.Q. no 257: Purported class member whose claim had been denied by the claims administrator in the tainted blood class action appealed to the Quebec Superior Court to reverse that denial. The Court noted that while it was sympathetic, the refusal ought to stand for a failure to have adduced evidence supporting the blood transfusion during the relevant period.

ARBITRATION

Griffin v. Dell Canada Inc., 2010 ONCA 29: In this case, the court refused to push a proposed class action into arbitration.

The first issue was a timing issue in relation to the new consumer Protection Act provision preventing arbitration clauses in consumer transactions. The court held that the arbitration right should only be considered at the time of the damage:

"In the case at bar, until the computers failed, there was no claim but rather "an ongoing legal situation" that only came to an end when the claims of the purchasers arose upon the failure of the computers. As "the facts triggering the application of the arbitration clause" did not occur until after July 31, 2005, it follows from Dell that the CPA applies and governs those claims.

I do not agree with Dell's submission that these passages from Deschamps J.'s judgment should be read as being subject to its "vested rights" argument. At para. 10, Deschamps J. specifically refers to Dell's argument that it "had a vested right to the arbitration procedure provided for in the contract with [the purchaser]" and from the balance of her judgment one can only conclude that her analysis of the "vested rights" submission is subsumed in her discussion of the application of the legislation that I have set out above.

I conclude accordingly that the CPA applies to exclude the application of Dell's arbitration clause to all "consumer" claims where the alleged defect of malfunction occurred after July 31, 2005, and that as the motion judge found that the unusual certification requirements are satisfied, those claims may proceed by way of class action.

The court also refused to stay the non consumer claims stating:

" The Arbitration Act, s. 7(5) confers a discretion to grant a partial stay where an action involves some claims that are subject to an arbitration and some claims that are not:

(5) The court may stay the proceeding with respect to the matters dealt with in the arbitration agreement and allow it to continue with respect to other matters if it finds that,

(a) the agreement deals with only some of the matters in respect of which the proceeding was commenced; and

(b) it is reasonable to separate the matters dealt with in the agreement from the other matters.

In my view, it would not be reasonable to separate the consumer from the non-consumer claims. We should, therefore, refuse a partial stay and allow all the claims to proceed under the umbrella of the class proceeding....It is important to note in this regard that Dell's arbitration clause not only requires all claims to be arbitrated, but also provides that "[t]he arbitration will be limited solely to the dispute or controversy between Customer and Dell", thereby precluding the possibility of a class arbitration. I would have found Dell's position much more persuasive had Dell been prepared to submit to an arbitration that would allow for the efficient adjudication of the claims on a group or class basis. However, in oral argument, Dell's counsel confirmed that his client would insist upon the enforcement of this provision and resist any attempt before an arbitrator to join together the claims of a group or class of consumers. In my view, this provides further evidence, if further evidence is required, that Dell does not genuinely seek to have the claims advanced against it determined by way of arbitration. Dell is simply seeking to exploit the inefficiency of arbitrating individual claims. As that inefficiency can be avoided if all the claims proceed by way of the class proceeding, I conclude that a granting a partial stay would not be reasonable."

On the broader issue, the court stated:

"[It] is not necessary for me to decide whether, apart from the CPA, Dell would have applied in Ontario. As the CPA will apply to all consumer claims arising after July 31, 2005, consideration of the application of Dell in Ontario has been rendered largely academic. To the extent that the application of Dell does remain a live issue, we are likely to receive further guidance from Supreme Court of Canada when it decides the appeal in Telus."

CLASS ACTIONS AT TRIAL

Lieberman v. Business Development Bank of Canada, S.C.. 2009 BCSC 1312: Plaintiff's successful in part at common issues trial.

PLEADINGS

Option consommateurs c. Banque de Montréal, 2009 QCCS 5595: Defendant applied to strike aspects of pleadings, on the basis that they alleged that they went beyond the scope of the certification order. The court agreed to strike the duty to warn and extra-contractual claims, on the basis that such claims were not certified.

In Conseil québécois sur le tabac et la santé c. JTI-MacDonald Corp., 2009 QCCS 5862, the plaintiff brought an application to strike certain of the defence allegations on the basis that, if left undisturbed, these would import a measure of complexity and delay to the proceedings that was unwarranted. The defendants' allegations spoke to the government's regulation during the 1950s, 60s and 70s as well as its knowledge of risks and dangers of smoking. The Court found that the analysis ought to be informed by the allegations made by the Class. The Court addressed each of the allegations involving the government and allowed the application in part. Leave to appeal this decision has been granted [2010] J.Q. no 699.

 

EVIDENCE

Fanshawe College of Applied Arts and Technology v. LG Philips LCD Co., [2009] O.J. No. 5002 (S.C.): Defendants sought to apply to strike affidavit filed by lawyer and expert report in price fixing case. The court noted the varying case law:

"Examples of cases that support the position that a motion to strike an affidavit should best be left to the judge hearing the certification motion are:

1) Hague v. Liberty Mutual Insurance Co., [2001] O.J. No. 6069 (S.C.J.);2) Andersen v. St. Jude Medical Inc., [2003] O.J. No. 3556 (S.C.J.); and3) 2038724 Ontario Ltd. v. Quizno's Canada Restaurant Corp., [2007] O.J. No. 1136 (S.C.J.).Examples of cases which have held a contrary view are:1) Edwards v. Law Society, [1995] O.J. No. 2900 (Ont. Gen. Div.);2) Chopik v. Mitsubishi Paper Mills Ltd., [2002] O.J. No. 2780 (S.C.J.);3) Punit v. Wawanesa Mutual Insurance Co., [2006] O.J. No. 3685 (S.C.J.);4) Pro-Sys Consultants Ltd. v. Microsoft Corp., [2008] B.C.J. No. 1778 (B.C.S.C.); and5) Metzler Investments GMBH v. Gildan Activewear Inc., [2009] O.J. No. 3394 (S.C.J.).

I prefer the position advanced by the defendants that I should not defer this motion to the certification stage. In my view, it will assist both sides that I rule at this preliminary stage on the admissibility of a substantial body of evidence."

The court stated: "Recognizing that certification orders do not settle substantive rights, but are procedural in nature, courts have regularly accepted affidavits sworn on information and belief on certification applications: Hoffman v. Monsanto Canada Inc., [2003] S.J. No. 259 (Q.B.) at para. 52."

On the admissibility of hearsay the court noted: "Brian Lee is currently incarcerated in the United States. For that reason, he is out of this jurisdiction and unable to testify. That situation, I find, meets the "necessity" criterion. On the question of the "reliability" of the Chunghwa Documents, I have regard to the following:

(a) There is an "inherent circumstantial guarantee of accuracy" in business re-cords: R. v. Martin, [1997] S.C.J. No. 172 (C.A.) at para. 42.(b) They were initialed contemporaneously by senior level Chunghwa executives who attended the meetings;(c) Chunghwa and two of the Chunghwa executives who participated in the meetings have been charged in the United States for their respective roles in the alleged conspiracy and have been sanctioned with fines and/or imprisonment. These Chunghwa Documents are clearly statements against in-terest. Thus, there is little incentive, if any, on the part of Brian Lee to have falsified any of these documents.I find that the Chunghwa Documents are admissible under the principled approach to hearsay exceptions."

The documents were also admitted as business records.

Carrier c. Québec, [2009] J.Q. no 14270 (S.C.) Court allowed a motion by defendants for pre-certification examinations, however, the court declined to allow the submission of three affidavits on the basis that these would go to the merits of the case.

Larose c. Banque Nationale du Canada, [2010] J.Q. no 73 involved a proposed class action for the loss of personal information that had been stored on the Defendant's computers. The Defendant's application to produce an affidavit was allowed in part.

Bruce Estate v. Toderovich, 2010 ABQB 21: Intervenor Health Quality Council of Alberta sought to strike filing of a report produced on the implicated sterilization procedures. The court found that the relevant statute did prevent admission of the report into evidence.

MOTIONS TO DISMISS

Cannon v. Funds for Canada Foundation, [2009] O.J. No. 4986 (S.C.): Plaintiffs agreed to dismiss against certain defendants in tax shelter scheme in return for cooperation. The court granted the motion stating: "The dismissal of the action against some of the defendants, in return for their cooperation, will eliminate the need for a costly and time-consuming jurisdictional challenge and will reduce the scope of the litigation and enhance its efficient and cost-effective progress. I am satisfied that the claims against the corporate defendants being released from the action are marginal at best and that there are serious jurisdictional issues pertaining to those defendants. I am also satisfied that the claims against the individual defendants being released are somewhat remote and in any event there is good reason to believe that those claims would result in paper judgments, at best. The cooperation of those individual defendants, by consenting to examination under oath, is a reasonable compromise in exchange for their release from the action."

CHICKEN AND EGGS

Thorpe v. Honda Canada, Inc., 2009 SKQB 488: Court found that challenge to national class provisions of Saskatchewan's statute should await certification. The court stated: "Firstly, it is a well recognized rule that, generally speaking, except where there are compelling reasons that dictate otherwise, such as time sensitivity, the certification motion should be the first motion heard on a class action. See Alves v. MyTravel Canada Holidays Inc., 2009 SKQB 77, [2009] S.J. No. 113 (QL); Attis v. Canada (Minister of Health) (2005), 75 O.R. (3d) 302 (Ont. S.C.J.). Secondly, it is more appropriate to rule on the constitutional issue after all the evidence pertaining to the certification motion is before the Court, rather than to make a ruling without factual underpinnings. Thirdly, should the certification application be denied on the merits, the Court may wish to exercise the option of not ruling on the constitutional issue because it would not be necessary to do so.". An application to investigate vehicle prior to certification granted

Adams v. Canadian Tobacco Manufacturers' Council, 2009 SKQB 387: The Court held that plaintiff's counsel could not apply for appointment of a case management judge until proof of service of all named defendants had been filed. The application must be by way of a formal ex parte application supported by an affidavit.

The court also declined to allow the defendant to examine the Plaintiff's vehicle for certification purposes stating: "The request made by Honda Canada is merit-based, and any inspection of the vehicle would not provide any probative evidence respecting the live issues on the upcoming certification application." However, the court did allow for inspection and preservation order in order to protect the defendant's position on the merits stating "If this was an ordinary individual claim and not a class action, an inspection of this nature would, perhaps, be routinely granted. I see no reason why, in these circumstances, that the fact that the action may be converted to a class action is of any consequence. Accordingly, I conclude that Honda Canada is entitled to an order that provides for the inspection and preservation of the plaintiff's Civic, and I am accordingly prepared to exercise my discretion in favour of granting such an order."

Alves v. MyTravel Canada Holidays, Inc. (c.o.b. as Sunquest), 2009 SKQB 232: application to examine several proposed extra-provincial class members prior to certification to establish existence of release denied

McKenna v. Gammon Gold Inc., [2009] O.J. No. 5151 (S.C.J.): Court rejected the defendant's application to have summary judgment motion heard at the same time as certification.

Martin v. Astrazeneca Pharmaceuticals PLC, [2009] O.J. No. 3847 (S.C.J.): Motion to schedule summary judgment motion prior to certification dismissed), aff'd [2009] O.J. No. 5265 (S.C.J.)

Kwicksutaineuk / Ah-Kwa-Mish First Nation v. British Columbia (Minister of Agriculture and Lands), 2009 BCSC 1593: Court did not allow motion to strike in advance of certification, on the basis that the grounds for the motion to strike overlapped with the certification requirements.

Holland v. Saskatchewan (Agriculture, Food and Rural Revitalization, Minister in Charge) 2009 SKQB 334: An application to add third party prior to certification was denied as defendant had not filed statement of defence. The defendant was order to wait until after certification hearing. The court also stated: "For a court to order that a third party may participate in a certification application, it is suggested there should be a rationale offered for such participation which goes beyond adding one more party in opposition to the plaintiff's application to satisfy the criteria set out in s. 6. No such rationale was offered in this matter."

APPEALS

Phaneuf v. Ontario, [2009] O.J. No. 5618 (Div.Ct): Certification overturned certification of detention class action. The court confirmed that the question of whether a claim discloses a cause of action is a question of law and no deference is owed to the motion judge (para.21). The court found that there was too many individual factors in relation to the reasons why placement in a bed may have been delayed to support certification.

Union des consommateurs c. Bell Canada by adding 2010 QCCA 351: Appeal of denial of certification refused.

Williams v. Ontario, [2009] S.C.C.A. No. 298: Leave to appeal dismissed in case dismissing proposed SARS class action Sharbern Holding Inc. v. Vancouver Airport Centre Ltd., [2009] S.C.C.A. No. 317: Leave to appeal granted in decision dismissing certified class claim on the merits.

Malhab c. Diffusion Métromédia CMR Inc., [2008] S.C.C.A. No. 518: Leave to appeal granted in decision dismissing taxi cab driver libel case.

Seidel v. Telus Communications Inc, [2009] S.C.C.A. No. 191: Leave granted in decision dismissing class action on basis of arbitration clause.

Roach v. Canada (Attorney General), [2009] O.J. No. 5286 (Div. Ct): Appeal dismissed of decision dismissing proposed class action challenging oath of allegiance.

Court affirms decision not to certify light cigarettes class action in Newfoundland: Sparkes v. Imperial Tobacco, 2010 NLCA 21

Barbour v. University of British Columbia, 2010 BCCA 63: Court overturns trial finding in favour of class as a result in interceding provincial legislation legalizing the behaviour. :Riendeau v. Brault & Martineau Inc., [2010] J.Q. no 1448 (C.A.): Quebec Court of Appeal upholds judgment in a class action involving the illegal publicity of consumer credit and violations under the Consumer Protection Act.

Pagé v. Bell Mobility Inc., 2009 QCCS 377 aff'd 2010 QCCA 31: Refusal to certify cell phone charge class action upheld.

 

COSTS AND FEES

Fantl v. Transamerica Life Canada, [2009] O.J. No. 5003 (S.C.): Costs of standing and fee approval motions considered. Both parties seeking more than $100,000 for these motions. Justice Perrell effectively poxed both their houses, held that there was divided success, and made no order as to costs.

2038724 Ontario Ltd. v. Quizno's Canada Restaurant Corp., [2009] O.J. No. 4977 (S.C.): Court declined to award costs against defendants on failed application to strike stating: "[T]he circumstances of the immediate case are convoluted by a remarkable and unusual procedural history that has already seen several controversies about the adequacy of the pleadings and their role as a factor in the test for certification. These particular circumstances made the motion to strike reasonable."

Coalition pour la protection de l'environnement du parc linéaire "Petit Train du Nord" c. Laurentides (Municipalité régionale de comté des), [2009] J.Q. no 13352 (S.C.): Court approved 25% fee on successful merits case.

Nadon c. Montréal (Ville de), 2009 QCCA 2372: Court overruled registrar's decision on aspects of costs decision in this dismissed pollen nuisance class action.

INTERVENTION

Susan Heyes Inc. (c.o.b. Hazel & Co.) v. Vancouver (City), 2009 BCCA 611: Plaintiff's in proposed class action sought to intervene in appeal of successful individual action. The application was dismissed. The court stated:

"...Mr. Bennett argues that the outcome of the appeal will directly affect the ability of his clients to pursue their actions in that a question of law that is common to their claims and Ms. Heyes' claim will be decided and questions of fact involving the conduct of the appellants will be decided. However, I do not see that that raises a direct interest in the sense that there must be a direct interest for purposes of intervention. The order made by Mr. Justice Pitfield was a judgment for damages in a specific amount in favour of Ms. Heyes. The appeal will result in either an order affirming that order or setting it aside. Those orders would not directly affect Mr. Gautam or anybody he proposes to represent. The reasons for making an order either affirming or setting aside Mr. Justice Pitfield's order will certainly have a bearing on the case that Mr. Gautam wishes to bring forward in the sense that the appeal may decide a legal issue that has the potential, on the basis of stare decisis, to block their action and bring it to an end. But that is different than a direct interest - that is an indirect interest. In my view, the applicants have not brought themselves within the first test."

AMENDMENTS

Andersen v. St. Jude Medical, Inc., 2010 ONSC 77: Plaintiff applied to amend to plead waiver of tort and add that as a common issue, but agreed to defer the trial of that issue. The trial was scheduled to commence on January 11, 2010. The court granted to application stating "...the waiver of tort claim, like the negligence claim, is entirely focused on the defendants' conduct and alleged wrongdoing. All of the material facts giving rise to waiver of tort have been pleaded with respect to the negligence claim and there has been full discovery on this. What is being proposed is an alternative theory of liability based upon the same factual matrix."

The Defendants sought to bifurcate the punitive damages issue. The court agreed to bifurcate part of the issue by rewording it as follows:

"10(a) Does the defendants' conduct merit an award of punitive damages? (b) Should an award of punitive damages be made against the defendants? If so, in what amount? Common issue 10(a) will focus on conduct and presumptive entitlement. If this question is answered in the affirmative, the court will subsequently address common issue 10(b), but only after the conclusion of all proceedings by individual class members, the quantification of compensatory damages, and the quantification of waiver of tort damages, if any."

Hinton c. Canada (Ministre de la Citoyenneté et de l'Immigration), 2008 CF 1343: Court declined to amend

Brochu c. Société des loteries du Québec (Loto-Québec), [2009] J.Q. no 15187, the Quebec Superior Court found that it was not improper for the Court to inquire about the applicability of consumer protection legislation, resulting in the amendment of claims by the class in this lottery class action.

DISCOVERY

Tracy (Representative ad litem of) v. Instaloans Financial Solution Centres (B.C.) Ltd., 2009 BCSC 1699: Court held that plaintiffs entitled to further discovery following common issues trial in their favour on unjust enrichment claims, in order to assist them in tracing the funds.

Martin v. Astrazeneca PLC, [2009] O.J. No. 5265: Appeal dismissed of decision refusing to allow summary judgment motion to proceeding before certification.

Pellemans c. Lacroix, 2009 QCCS 5674: Motion to strike expert reports dismissed in ongoing Norbourg collapse saga.

NATIONAL CLASS ISSUES

Lépine c. Shire Canada inc., [2010] J.Q. no 417 stayed a motion for certification in Quebec was stayed due to a similar class action in Ontario on consent of the parties.

In Reader's Digest Magazines Ltd. c. Speers, 2010 QCCS 49, however, the Quebec Superior Court refused to stay a Quebec action until an Ontario certification case was resolved. The court noted that it was not clear when the Ontario case would conclude, and that the actions were somewhat different.

Ward Branch, PartnerBranch MacMaster | Barristers & Solicitors1410 - 777 Hornby StreetVancouver, B.C. V6Z 1S4P: 604.654.2966 | F: 604.684.3429www.branchmacmaster.com <http://www.branchmacmaster.com/>

This message is intended only for the use of the individual or entity to which it is addressed, and may contain information that is privileged, confidential and exempt from disclosure under applicable law. No waiver of privilege, confidence or otherwise is intended by virtue of communications via the internet. If the reader of this message is not the intended recipient, or the employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please notify us immediately by telephone.

« June 2010 | Main | November 2009 »

Reader Comments

There are no comments for this journal entry. To create a new comment, use the form below.

PostPost a New Comment

Enter your information below to add a new comment.
Author Email (optional):
Author URL (optional):
Post:
 
All HTML will be escaped. Textile formatting is allowed.