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Tuesday
Oct132009

October 2009

Our Western Canadian Class Action Conference is coming up on Friday, November 20. Sign up now!

The registration link is below:

http://www.cle.bc.ca/OnlineStore/productdetails.aspx?id=1826909

The program is certainly broad enough to be of utility to lawyers across the country. For those of you who cannot make it to Vancouver, the conference can be attended over the web (including with video if your server is strong enough).

The conference includes a free cocktail party the evening beforehand, sponsored by Branch MacMaster and the Bruneau Group. We'll email drinks out to web attendees, and/or you can watch us imbibe via webcam.

OTHER CONFERENCES

The Québec Bar Continuing Education Service conference on class actions which will be held on October 29-30 at the InterContinental Hotel , Montréal. The program can be found at : http://www.barreau.qc.ca/formation/activite.jsp?Langue=en&noActiv=1178&namePage=activite.jsp

TWEET

Follow us on Twitter at http://twitter.com/wbranch99

SUPREME COURT OF CANADA CONSIDERS CLASS ACTIONS

Marcotte v. Longueuil (City), 2009 SCC 43, Breslaw v. Montreal (City), 2009 SCC 44: Court held that a class action was not necessary in order to strike a taxation by-law in a 5:4 split decision. The court held that a class action was not necessary to stop the limitation period, since the limitation for the declarations sought had not yet started to run. The court also found that there was a problem in that individual class members would not be able to exercise their right to opt out. The majority made the following comment on proportionality requirement contained in Art.4.2 CCP:

"[The] effect of the principle of proportionality is to cast serious doubts on the appropriateness of bringing class actions to achieve the purposes being pursued in the appellants' proceedings. The class action has a significant social and legal role, as the courts have often confirmed. Nevertheless, I consider the Quebec Court of Appeal's consistent line of authority, according to which a request for a declaration that a municipal by-law is null cannot be made by means of a class action, to be sound in that it reminds us that the class action must be used properly, which does not seem to me to be the case in the two appeals before this Court."

The dissent found that invoking proportionality to reject the action was improper (para.74), particularity since Quebec's class proceeding statute did not have a preferability requirement (which the dissent suggested had certain parallels).

As with the judgments from the SCC on arbitration provisions in Dell and Rogers, there was enough of a Civil law veneer to these decisions that there is likely to be some debate in the common law provinces as to their applicability. Once again, the majority declined to refer to the mass of common law case law on constitutional class actions in order to provide guidance to the rest of the country.

PRICE FIXING CASE CERTIFIED

Irving Paper Ltd. v. Atofina Chemicals Inc., [2009] O.J. No. 4021 (S.C.): After a number of losses and limited decisions, a clear win for the proponents of price-fixing class actions. On class definition, the court stated:

"In my view, it is no response to the plaintiffs' proposed class definition that because it is so large, it is unsuitable. If that were so, defendants engaged in "bad behaviour" affecting large numbers of the population could do so with relative impunity, knowing that class proceedings were not available and individuals affected would be most unlikely to bring an individual action." (para.105).

The court suggested that the earlier decision in Chadha refusing certification of a price fixing decision has essentially been overtaken by the Ontario Court of Appeal's decisions in Markson and Cassano:

"I am of the view that Markson and Cassano signal a different approach to be taken to certification whether it be in breach of contract or other types of cases. Justice Rosenberg spoke of the need to establish "potential liability" before resort to the aggregation provisions could be had. That being so, it seems to me that the plaintiffs here need only prove potential liability -- in other words, that the defendants acted unlawfully. This would trigger the aggregate assessment provisions. Further, Markson establishes that not every class member need have suffered a loss and so it is not necessary to show damages on a class-wide basis."

In relation to the potential complexities created by the pass-on defence, the court noted recent criticisms of this defence outside the price-fixing area, and stated: "As I have already noted, these decisions were not ones involving allegations of a price-fixing conspiracy. However, it seems to me that the plaintiffs should be given an opportunity to advance their arguments at trial on the basis of a full evidentiary record." (at para.150)

On preferable procedure, the court concluded: "In my view, a class proceeding is the preferable procedure in this case. The defendants have not identified an alternate procedure. It seems to be their position that no litigation is preferable to a class proceeding. That argument has been already rejected in Markson." (at para.153)

NATIONAL CLASS ISSUES

In Chalmers (Litigation guardian of) v. AMO Canada Co., 2009 BCSC 689, the Defendants expressly challenged the jurisdiction of the BC Supreme Court to hear non-residents' claims. The Court rejected the Defendants' submissions, noting that pursuant to the Court Jurisdiction and Proceedings Transfer Act, it had jurisdiction on the basis that (a) one of the Defendants was extra-provincially registered in BC and therefore "ordinarily resident in British Columbia", and (b) there was a real and substantial connection between British Columbia and the facts on which the proceeding against the Defendants was based. The Court then proceeded to the second stage of the jurisdictional analysis, and concluded that it should not decline to exercise its territorial competence on the basis that (a) the aggregation of claims provides economies of scale; (b) the Defendants had not put forward any evidence to show significant variation as between the laws of the provinces on either the negligence or punitive damage common issues; (c) the inclusion of non-residents allows for the reduction or avoidance of multiplicity of proceedings; (d) the inclusion of non-residents reduces the possibility of conflicting decisions in different courts; and (e) certification of national class actions promotes the fair and efficient use of resources within the Canadian legal system as a whole. [Editors note: Hear, hear!].

Mignacca et al. v. Merck Frosst Canada Ltd. (2009), 95 O.R. (3d) 269 (Div. Ct.): This February 2009 decision snuck under the author's radar. In this Ontario Vioxx action, the Divisional court held that the refusal to stand down in favour of the certified Ontario action was not improper. (Note: This decision issued prior to the Saskatchewan Court of Appeal's decision dismissing certification)

On whether there was a constitutional imperative to respect the earlier Saskatchewan certification decision, the court stated: "We disagree with Merck's submission that the case law dictates that the first multi-jurisdictional certification order made in Canada is a trigger point, crystallizing carriage of the class action with the effect of "shutting down all class actions across Canada". A rule of swiftest to the finish line taking all encourages tactics that may well be contrary to the interests of justice. Such an interpretation of the principles of constitutional respect for judgments and comity in the case law may result in an arbitrary, unfair order...In this case, the Saskatchewan Amending Certification Order is under appeal and hence is stayed pending the appeal. Therefore, the respondents may argue that the Ontario certification order is the first final certification order in Canada. This argument has no more merit than the argument advanced by Merck. Such a rigid technical approach encourages unfair tactics and undermines the integrity of the justice system....When the "full faith and credit" constitutional principle and the principle of comity are considered in light of their underlying objectives in the context of potentially competing multi-jurisdictional class actions, I conclude that it is clear that Cullity J. was not constitutionally bound to stay the Ontario Action, and that he had jurisdiction to make the decision to refuse to grant the stay."

On the effect of the even earlier Ontario carriage order rejecting Saskatchewan plaintiff's counsel: "As outlined, the principle of comity is that courts must consider and respect decisions in other juris-dictions, and should not undermine prior decisions. We conclude that the principle of comity applied both to Klebuc C.J. when he considered the Merchant Group's request to amend the existing certification order in light of the Carriage Decision, and to Cullity J. when he considered the issue of the request for a stay of proceedings. As counsel for the Consortium suggest, comity in the facts of this case is a two way street...Although Klebuc C.J. briefly mentioned the existence of the Carriage Decision, it does not appear that the principles of comity in the unique facts of this case were adequately respected...Winkler R.S.J. did not merely make a finding that the Consortium was better qualified to represent a national class of plaintiffs. He found that it would be inappropriate for the Merchant Group to represent a national class of plaintiffs. He also chose the current Ontario Action in preference over the Wuttanee #1 national class action."

On comity, the court stated: "We conclude that Cullity J. in this delicate situation gave full faith and credit to the Saskatchewan decision, to the extent it did not undermine the Carriage Decision and the findings of fact in that decision as to the best interests of the litigants in Ontario and elsewhere."

On the abuse of process associated with having two cases doing the same thing: "Merck argues that it is the first defendant in Canada to be subject to simultaneous competing multi-jurisdictional class actions certified in two different provinces involving the same plaintiff class and substantially the same claims, thereby creating chaos, [page284] confusion, uncertainty and the possibility of inconsistent verdicts, contrary to the interests of judicial economy. We conclude that Merck identifies a problem, but exaggerates the consequences of two par-allel proceedings. Potential plaintiffs would receive notices with respect to two actions. A mechanism would be found for plaintiffs to chose between the two outstanding actions and proceed within the action of their choice. [Editor's note: Huh? These are both opt out statutes. There is no need to choose at this stage of the proceeding.] Apparently some 7,000 potential plaintiffs have already contacted counsel in the Consortium. As Cullity J. observed, the presence of two overlapping multi-jurisdictional class proceedings is unfortunate, but the problems are solvable with co-operation, communication and direction from the courts." [Editor's note: Group hug between two sets of counsel and two courts that have been sniping for years. Sounds like a great plan!]"

The boomerang problem: "We note that Merck's argument of prejudice to the defendants flatly contradicts the position it has taken in these and all other proceedings. Merck's assertion of "chaos" and prejudice caused by two similar multi-jurisdictional class actions appears somewhat hollow given Merck's express preference for individual actions, or 13 provincial class actions across the country."

On forum shopping: "I conclude that a greater abuse would be to allow and encourage forum shopping, and to require the Ontario plaintiffs to be required to pursue their actions in Saskatchewan, with the Merchant Group as their representatives." [Editors note: Isn't forum shopping also a two-way street?]

Summary: Bad facts, bad law.

CLASS ACTIONS AT TRIAL

Tracy v. Instaloans Financial Solutions Centres (B.C.) Ltd., 2009 BCSC 1036: Court found constructive trust in payday loan case.

Lieberman v. Business Development Bank of Canada, 2009 BCSC 1312: Pension surplus case decided in favour of the class.

Bennett v. BC, 2009 BCSC 1358: Retirement benefits class action dismissed.

Dean v. Mister Transmission (Intl) Ltd., 2009 OJ 3445 (S.C.): Class claim by franchisees dismissed on summary judgment.

THIRD PARTY FUNDING

Meltzer Investment GMBH v. Gildan Activewar Inc. 2009 CanLII 41540 (ON S.C.): Court found that proposed third party financing agreement was not contrary to public policy (para.62), and was not per se champertous. However, the precise terms of the arrangement before the court did not allow approval. The court stated:

"[It] is intended that CFI's commission will be in all practical terms a first charge, after legal and administrative expenses, on the monies recovered for the Class Members if this proceeding is certified. It seems to me that is why the plaintiff, as required by CFI, is seeking the court's approval of this Agreement, which requires an assessment of the fairness and reasonableness of a compensation payable to CFI. That assessment cannot now be undertaken. It is not enough to compare the proposed commission to the 10 per cent levy paid to the Class Proceedings Fund. Here, as in McIntyre, the compensation to be paid to CFI is completely related to the amount of money that is ultimately recovered. It has no relationship to the amount of money paid by CFI, the period of time during which those monies are outstanding, the degree of risk assumed by CFI or the extent of its exposure to costs. There is no cap on the amount of compensation payable to CFI. It is impossible to conclude that this Agreement will not amount to "over compensation" to the extent that it is unreasonable and unfair to those who will bear its expense. For the forgoing reasons, in these circumstances, this court cannot now declare that the Indemnification Agreement does not engage maintenance or champerty."

SETTLEMENTS

Fantl v. Transamerica Life Canada, 2009 CanLII 42306 (ON S.C.): Court certified and settled fund expense case.

Bishay v. Maple Leaf Foods Inc., 2009 SKQB 326: Maple Leaf settlement approval reasons issued in Saskatchewan arm of the case. The writer was co-counsel in the national action.

Sutherland v. Hudson's Bay Co., [2009] O.J. No. 3472 (S.C.): Pension surplus case settlement case. The court noted that receipt of 11% of the claim damages was reasonable in light of the fact that the plaintiffs had already lost on all major issues at trial. The $1.5M fee was (a) 17.6% of the settlement, and (b) less than the time recorded on the file, and on that basis was approved.

Marcantonio v. TVI Pacific Inc., [2009] O.J. No. 3409 (S.C.): Securities class action settlement for $2.1 million approved. Court made the following helpful summary statement: "Numerous cases hold that where certification is sought for the purposes of settlement, the certification requirements must be met, but are not applied as stringently." (at para.6). The court noted that the amount was between $3-4.4M of counsel's view of assessed losses. Class counsel fees of 25% were approved. The court commented on the benefit of the percentage approach stating: "The method of determining fees set out in s. 33 of the CPA - the 'lodestar' method - has been the subject of judicial and academic criticism. Justice Cullity recently commented on its deficiencies in Martin v. Barrett, [2008] O.J. No. 2105 at paras. 38-39 (S.C.J.) (QL); see also, Endean v. Canadian Red Cross Society, [2000] B.C.J. No. 1254 at paras. 15-16, 19 (S.C.) (QL); Benjamin Alarie, "Rethinking the Approval of Class Counsel's Fees in Ontario Class Actions" (2007) 4(1) Canadian Class Action Review 15 at 37-38. A multiplier can reward lawyers who accumulate unnecessary time and punish those who are able to do things effectively in less time. I do not have to grapple with these difficulties in this case as the retainer agreement does not provide that fees are to be calculated by applying a multiplier and none is requested. Nonetheless, based on time included in the evidence on the motion, and based on consideration of only the monetary benefits obtained for the class, by the time the litigation is con-cluded and interest accrues on the settlement amount, counsel estimate the multiplier will be ap-proximately 2.5. This settlement was achieved at an early stage, but if a multiplier were to be applied, I consider a multiplier in this range to be acceptable having regard to the risks assumed and the results obtained for class members in the circumstances of this case."

CERTIFICATION

Kulula v. Kativik School Board 2009 QCCS 4152: Sexual abuse case refused certification. Interestingly, the court commented on the use of common law cases:

"The Court is mindful that precedents decided under legislative schemes that differ from the Code of Civil Procedure cannot be relied upon indiscriminately"

The court also reflected on the need to weigh predominance while assessing in Quebec's common issues requirement stating:

"The precedents mentioned above stand for the principle that art.1003(a) CCP requires more than the mere existence of any 'identical, similar or related questions of law or fact'. Such questions must be sufficiently substantial compared to the outstanding individual questions that a class action would serve the ends of justice, its additional complexities and cost being offset by improved efficiency of process. Here, individual questions probably outnumber common ones overall. But the applicable test is not mathematical. It requires balancing the significance of the common issues in relation to individual ones and ascertaining whether the duplications avoided through a class action justify its additional complexities and cost."

The court found that there were proper common issues.

The court stated that the class definition should be those who "claim to have been the victims" rather than just victims, as the latter definition depended on the outcome of every individual claim.

In terms of whether 1003(c) was met, the court stated: "Fulfilling the condition expressed in art. 1003(c) CCP does not require demonstrating that a class action is the best procedural vehicle available to the group, only that "the composition of the group makes the application of article 59 or 67 difficult or impracticable'" The court held that this requirement was not met as their were only 2 known class members. The court stated "In the context of this case, it should have been possible for the Applicants to identify Mr. Garceau's alleged victims, to communicate with them and to seek their intent...Given that the alleged sexual abuse was allegedly committed by only one individual and that it allegedly occurred during a limited period of time (less than fourteen months) in a village of a few hundred inhabitants in total, the actual number of Student Class Members is likely to be relatively small. In the fact of modern telecommunication systems and the probability that the number of Student Class Members is relatively small, providing the court with practical reasons explaining the Applicants' difficulty to avail themselves of either art.59 or art. 67 CCPP is all the more necessary."

On the adequacy of the representative, the court stated "[The] mental impairment of a group of victims is not, in and of itself, a bar to the institution of a class action....However...[simply] put, there is nothing in the Motion that would suggest that these Applicants are now in a position to represent the members adequately despite the ongoing and severe impairment from which they allegedly suffer.".

Gunther v. Canada (Minister of Citizenship and Immigration), 2009 FC 875, Krena v. Canada (Minister of Citizenship and Immigration), 2009 FC 874: Immigration fee cases denied certification, primarily on grounds that representative plaintiffs did not have standing.

Brahmana v. LUC Education (B.C.) Inc. (c.o.b. Lansbridge University) 2009 BCSC 986: Court certified a contract class action against an education facility that shut down in the midst of the class' academic program.

The court made an interesting comment on the plaintiff's "shortcut" litigation plan: "The defendant takes issue with part of the plan drafted by plaintiff's counsel. Section 10 of the plaintiff's case plan proposes that individual issues be addressed by affidavit and that "standard proof of loss claims forms be developed and approved by the court". The defendants say that document disclosure and viva voce evidence is the fair method of proceeding. I agree with the defendants. The Act requires a workable plan before the class can be certified. The plaintiff's proposed plan is amended by requiring the individual issues to be proved in the normal way. With that amendment, the plaintiff's case plan is workable"

The court also commented on a need for an extraprovincial subclass: "[A]s submitted by the defendant in the course of oral argument, due to the potentially high number of international students included in the identifiable class, it is necessary to introduce a sub-class into the plaintiff's proposed definition. Section 6(2) of the Class Proceedings Act requires a sub-class for non-residents with its own representative."

Association pour la défense des droits des défunts & familles cimetière Notre-Dame-des-Neiges c. Caghassi, 2009 QCCS 3832: Funeral services class action certified. Plots allegedly were not properly maintained during a labour lockout.

Durand c. Dermatech, 2009 QCCS 3874: Pharmaceutical class action refused certification. The court considered the inclusion of a "claims made" definition, and found that it was not fatal (at para.46). The court also round that the requirement for a reaction to the drug was sufficiently objective. However, the Plaintiff failed to put forward enough evidence to meet the "serious appearance of right" question. The court also found that the Plaintiff had not put forward sufficient information to demonstrate that joinder was impractical. The court also found that the representative was not appropriate as she relied completely on the advice of counsel.

Goyette c. GlaxoSmithKline inc., 2009 QCCS 3745: Paxil class action refused certification. The court held that hearsay evidence could be received on a certification application (para.8).

The court found that the scope of the duty to warn was a proper common issue.

The court rejected a punitive damages common issue stating:

"The present case must be distinguished from the case of Quebec (Public Curator) v. Syndicat national des employés de l'hôpital St-Ferdinand.28 This was a class action in which exemplary dam-ages were awarded to patients who suffered prejudice in the form of temporary discomfort due to illegal labour action by unionized employees of a hospital for mentally-challenged persons. In that case, there was a claim for moral damages to be collected as a class based on the allegation that all patients would have suffered equally the temporary discomfort. As confirmed by the Supreme Court of Canada, moral damages were awarded for $1,750.00 for each of the patients and the class of pa-tients received - collectively, as exemplary damages - the amount of $200,000.00. Contrary to that case, the members of the potential class in this case will individually have to prove their physical and psychological damages, any economic damages and any moral damages on the basis of individual hearings. It is only once these amounts have been decided individually that the Court could then consider what, if any, amount should be awarded for exemplary damages on the basis of the criteria under art. 1621, C.C.Q.29 Accordingly, the question of exemplary damages is not "similar, identical or connected" to all members of the group. Rather it is a question to be decided for each individual Paxil user."

The court rejected certification on the grounds that each case would have to be established individually: "Firstly, there are 8 different C.P.S. years involved from 2000 to 2008. Accordingly, there would be different sub-classes depending on changes in the relevant wording in each of the years. Secondly, this is not a case where a defective product is being produced which creates a definite number of difficulties in the user. In this case, civil liability must be determined by assessing the specific risks disclosed for each individual patient which risks vary depending on multiple factors:

a) whether the adverse effects occur during the use of the product and lead to discontinuation;b) whether adverse effects follow discontinuation;c) whether the user was advised prior to use, by either their physician or pharmacist, of whether they may experience dependency or withdrawal symptoms;d) whether the symptoms suffered were described in the C.P.S.;e) whether the symptoms were not described in the C.P.S. but are proved to be directly related to the use of Paxil; orf) to the extent that the symptoms arose following discontinuation, whether such symptoms were "mild and transient" and were described in the C.P.S."

The court also found that the case did not appear to justify the conclusions sought as: "While she vaguely asserts that the C.P.S. did not give adequate notice of Paxil's risks, the symptoms listed specifically in the Amended Motion for Authorization do appear in the C.P.S." (at para.97) and "Unlike the Dallaire case, Ms. Goyette has chosen not to file any medical expertise to directly link her symptoms with the discontinuation of Paxil, choosing rather to rely on circumstantial evidence - of the proximity of the symptoms to the reduction in dosage and the complete discontinuation - as being sufficient to demonstrate this causal link." (para.99)

The court also rejected the representative on the following grounds:

"a) based on the previous analysis, Ms. Goyette cannot represent a class since she herself does not have a cause of action;b) Ms. Goyette has shown a singular lack of interest in that: i- she has never sought to speak with any of the other members of the group, none of whom she knows; ii- she has never sought to communicate with any of the individuals alleged to have signed up at her attorneys' website...; andc) she can provide no explanation as to why these legal proceedings which started on May 2, 2002 remained dormant for more than 5 years."( at para.116)

The court found that the Plaintiff could not represent a national class since she "does not allege that Paxil sold in Canada is manufactured in Quebec, distributed from Quebec or even that the product monographs are printed in Quebec" and hence there was no required "real and substantial connection". (at paras.120-123).

Nadolny v. Peel (Region), [2009] O.J. No. 4006 (S.C.): Case refused certification in relation to increase in premiums payable by employees who received early retirement. Court found that the fact that there were only 48 to 79 class members did not weigh against certification (at para.27). However, the court declined to certify stating:

"Here there is specific evidence of a number of documents as well as verbal communications which may be found to have comprised the contract between the Region and individual proposed class members and which varied between them. Thus, it may well be found on a common issues trial, in part at the instigation of the plaintiff based on allegations of implied terms, that the Plaintiff's claims are not based solely on the written documentation that flowed from the Region to the early retirees as they considered whether to take early retirement, as they were in Ormrod, but rather on all of the representations made by the Region. Were such a finding to be made, then it seems probable that all of the representations made by the Region to all of the retirees would necessarily be central to a consideration of liability as defined by the common issues." (at para.62)

The court accepted that the question of whether there was a duty to advise could be a common issue: "However, while it may establish the existence of a class wide duty to the retirees, it is of questionable value as a common issue that can advance the litigation on its own, and the question is meaningless except in conjunction with a determination on the follow up proposed class issue whether the Region did provide that advice to the retirees as a class." (at para.81)

The court found that it was not an appropriate case for aggregate assessment of damages stating: "Just as causation was required to be proven individually in that case, here the implied contractual terms alleged to form a part of the contract and to have been breached, the representations alleged to have been made by the Region, and the reliance allegedly placed on those representations by individual class members, can only be proven individually having regard to each retiree's communications and course of dealings with the Region. Only then will the liability have been established that could form the foundation for an award of damages - and the amount of damages properly payable at that time by the Region to compensate each retiree for its liability to each of them will also be idiosyncratic and flow directly from the particular circumstances and course of dealings that occurred between the Region and the retiree." (at para.100)

The court found that there was no class as: "the current class definition remains overly broad, potentially encompassing many who do not have a claim, including those who understood before retirement that their premiums were subject to change. It also remains overly broad because it continues to define a class based on an assumption that the circumstances of all of the retirees are the same when they are demonstrably not, and because it continues to be focused towards a number of alleged common issues that I have found are not." (at para.123)

On preferability, the court relied on the individuality noted above, as well as the fact that no one aside from the plaintiff had expressed an interest in becoming part of the class. (at para.130).

Bryson v. Canada (Attorney General), 2009 NBQB 204: Agent Orange class action refused certification. The court declined to accept a "who claim to" restriction on the class definition stating: "In my respectful view, the addition of the qualifying words "who claim to" does not, rectify the underlying problem with the overly broad definition of class members, in the sense that many members of the proposed class would likely have no claim for actual damages against the defendant and in those instances there would be no rational relationship or connection between those individuals and the common issues asserted in the action. In effect, the proposed class includes anyone who was within 10 kilometers of the base during the approximate 53 year period since 1956, and claims to have suffered injury or risk of injury from the application of the chemicals. The proposed definition does not require any actual exposure to the chemicals as a condition of class membership. It is axiomatic that without exposure in some manner there can be no damage and no claim for damages or personal injury."

The Plaintiff rejected the causation common issue stating: "[T]he problem with the plaintiffs' proposed common issues dealing with risk and general causation on a common issues basis for the class as a whole is that the methodology inherent in such an inquiry, considering the number of chemicals involved, the number of diseases alleged, the potential size of the proposed class, the length of the class period and the multitude of variations in exposure, would necessitate a determination of potentially hundreds or thousands of separate inquiries to answer the proposed general causation issue and each of these very individual inquiries may in fact be "common" to only a small number of class members or perhaps to none of them at all."

On preferability, the court placed little reliance on the federal compensation programs since (1) the class was broader than those eligible for these programs, and (2) the class was seeking broader relief than allowed under these programs. However, the court found that "the trial of the proposed common issues would quite likely either become overwhelmed or bogged down by the individual issues contained within them; or their resolution, even if possible to resolve in a common issues trial, would do little to advance the resolution of the individual issues which would still be largely left to be dealt with in the individual proceedings." (at para.91)

Élément c. Philips Avent, 2009 QCCS 3370: Bisphenol A certification applications rejected. Court held that there facts alleged did not seem to support the conclusions. The court stated that fear based on hypothetical and unproven concerns was not compensable under Quebec law. The court also found that inadequate efforts had been made to locate true class members.

Lafontaine c. Vidéotron ltée, 2009 QCCS 3189: Service interruption class action certified.

COSTS

2038724 Ontario Ltd. v. Quizno's Canada Restaurant Corp. [2009] O.J. No. 3127 (S.C.): Quizno's sought to stay costs award to Plaintiff's pending consideration of a reconsideration motion by the Court of Appeal. The court declined to make the order given that the reconsideration motion involved a failure to present an appeal in a timely manner so there was technically no appeal against which a stay could issue.

2038724 Ontario Ltd. v. Quizno's Canada Restaurant Corp., [2009] O.J. No. 3095 (Div.Ct): Plaintiff successful getting case certified on appeal. Court awarded costs of $85g on request of $113g. The court stated:

"It is not unusual, as Cullity J. noted in Sutherland v. Hudson's Bay [2006] O.J. No. 2009, that the claim reveals an "over-generous" expenditure of time by counsel which has become endemic in class proceedings. Although the issues were complex and the result important, they were no more complex or more important than in Cloud v. Canada (Attorney General) [2005] O.J. No. 733, which was argued in 2004. On that appeal, the court found that a claim for $120,000 was excessive and they ordered costs of $60,000 inclusive of disbursements and G.S.T."

2038724 Ontario Ltd. v. Quizno's Canada Restaurant Corp., [2009] O.J. No. 3948 (S.C.): Heading further down the costs rabbit hole, the court awarded the Plaintiffs $5250 in relation to a motion seeking a stay of an earlier costs award. Coming up next, a motion to consider costs of the costs of the costs motion! In further Quizno's news, the Court of appeal declined to extend the time for the defendant to appeal decision declining to give stay: 2038724 Ontario Ltd. v. Quizno's Canada Restaurant Corp., 2009 ONCA 656.

Speers (Trustee of) v. Reader's Digest Assn. (Canada) ULC, [2009] O.J. No. 3106 (.S.C.): Plaintiff lost motion to stay Quebec defamation action. The court awarded $45g in costs rather than the $59g requested given the novelty y of the issues.

Dean v. Mister Transmission (International) Ltd., [2009] O.J. No. 3830 (S.C.): Plaintiff lost summary judgment motion post-certification. Defendant sought $200g in costs including the $125 they had to pay as costs on certification. The court stated: " I reject the defendants' submission that they should be awarded costs of the certification motion, when the plaintiff has already been awarded costs of that motion. While it was otherwise at one time, it is now commonplace for costs to be awarded for each interlocutory proceeding as it occurs." The court did not find that any of the s.31 factors existed, but did acknowledge the need to recognize access to justice concerns. The court awarded $45g, which was reduced by an earlier unpaid costs award in their favour.

Berry v. Pully, [2009] O.J. No. 3845 (S.C.): Costs in favour of plaintiff on various discovery motions set at $45g. One of the discovery judgments is reported at [2009] O.J. No. 3200.

Malhab c. Métromedia CMR Montréal inc., 2009 QCCA 1555: Court of Appeal ordered that the class notice costs incurred following a successful certification appeal by a plaintiff should be addressed by the lower court, and were not properly claimed as disbursements in relation to the appeal.

Comité provincial des malades c. Regroupement des CHSLD Christ-Roi, 2009 QCCS 3755: Plaintiffs application for special fee flowing from successful class resolution granted under 1050.1 CPC.

McNaughton Automotive Ltd. v. Co-operators General Insurance Co.2009 ONCA 598: Costs considered in relation to failed leave to appeal from costs order. Insurers awarded costs of $140,000.

THIRD PARTIES

Holland v. Saskatchewan (Agriculture, Food and Rural Revitalization, Minister in Charge), 2009 SKQB 334: Defendant Province sought to join third party Canadian Food Inspection Agency in a proposed elk disease prevention class action. The motion was dismissed because a Statement of Defence had not yet been filed. Further:

"As has been commented on in a number of decisions, it is simply not obvious why a third party or a proposed third party should be allowed to participate in such a motion. ... The criteria set out in s. 6(1) of the Act all relate to matters between the plaintiff and the defendant: whether there is a cause of action; whether there is an identifiable class; whether the claims of the class members raise common issues; and whether the class action would be the preferable procedure for the resolution of the common issues. 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."

CONFLICT OF INTEREST

Wallace v. Canadian Pacific Railway, [2009] S.J. No. 549 (Q.B.): A defendant sought to remove plaintiff counsel based on conflict of interest. The court issued the order noting that:1. CN was a client when the firm decided to launch the class action;2. This decision understandably led to a sense of betrayal which damaged the solicitor-client relationship such that the firm's ability to represent CN effectively was substantially and irrevocably impaired; and3. The Professional Litigant exception did not apply.4. Disqualification was the appropriate remedy. Notably, the court stated: "I also do not accept the position of the McKercher Firm that disqualification would effectively prevent the plaintiff from representation because it and two other larger law firms in Saskatchewan would be in conflict and that those three firms are the only ones capable of prosecuting such a claim. First, there is no evidence to that effect; second, in the new age of lawyer mobility, plaintiff's counsel need not necessarily be from Saskatchewan."

APPLICATIONS TO STRIKE

Merchant Law Group v. Canada (Revenue Agency), 2009 FC 755: The court struck this GST action finding that:(a) there was no evidence of misfeasance in public office;(b) there can be no common law claims for misapplication of the GST statute;(c) the Tax Court of Canada has exclusive jurisdiction over such claims.

King v. Canada (Ministre des Ressources humaines et du Développement social) 2009 CAF 105: Preliminary question of law found in Crown's favour on appeal in proposed class action seeking interest on successful social benefit appeals.

Campos v. Sun Life Assurance Co. of Canada, [2009] O.J. No. 3408 (S.C.): Court found that LTD benefit complaint should be addressed through labour arbitration.

SCHEDULING ISSUES

Duzan v. Glaxosmithkline, Inc.2009 SKQB 336: Court asked to set certification schedule in Paxil class action. Some interesting comments:

"In the Romano action, the Ontario Superior Court of Justice made a scheduling order on October 25, 2009 based on an agreement between counsel. That order called for the certification application to be heard during the week of January 12, 2009 and required the plaintiffs' Certification Motion Record to be served by May 30, 2008. The Certification Motion Record was not served by that date and Merchant Law Group then discontinued the Romano action on the basis that this action would move forward expeditiously in Saskatchewan. That has not happened....[Mr. Merchant] he repeatedly declined to have any meaningful input into a schedule, taking the position that he would prefer to "park" this action for the time being. His position was that the plaintiffs should decide whether and when they would proceed and that his office had better things to do than to deal with this claim at this time. Finally, he asked what the court would do about it if the plaintiffs did not follow a prescribed litigation schedule. I am satisfied that it is necessary and appropriate to establish a schedule leading to certification."

White v. Glaxosmithkline, Inc., 2009 SKQB 337: Court establishes pre-certification schedule stating "The defendants are entitled to have this proposed class action prosecuted expeditiously in order to remove the cloud of litigation hanging over their product."

Hall v. General Motors of Canada Ltd., 2009 SKQB 312: Court establishes pre-certification schedule.

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

EXAMINATIONS

Alves v. MyTravel Canada Holidays, Inc. (c.o.b. as Sunquest), 2009 SKQB 232: Defendant sought to examine several extraprovincial proposed class members prior to certification to establish that there was a release in place with these members. The court declined to make such an order stating:

"In my view, neither Rule 289 nor s. 7(1) of The Class Actions Act, read separately or together, allow the requested examination at this stage. Even if they did, this kind of an order is a discretionary one and I would, in any event, decline to order the examinations on the basis that they are unnecessary. If Red Seal wants to put evidence before me on the certification regarding set-tlement, Red Seal can file an affidavit if they wish. At this stage, I will not allow Red Seal to conduct what amounts to an examination for discovery on a non party about a possible defence because it cannot get an admission from the plaintiff on that issue"

CLASS DEFINITION ISSUES

Gallagher v. Aurelian Resources Inc., [2009] O.J. No. 3109 (S.C.): Case was certified on consent March 3, 2008. Motion brought to confirm whether 2 individuals were in the class or not. The court determined that they were. The court made an interesting comment about the approach to such issues: "Interpreting the class definition is not simply a matter of applying contract interpretation principles, and to the calculus of interpreting the class definition must be added the purposes and policies of the Class Proceedings Act, 1992....Their inclusion is consistent with the principles of access to justice, judicial economy, and behaviour modification...If Mr. Miller's and Advantage Equipment's legal position is different from other class members - which remains to be determined - this can be raised as a matter of defence by Aurelian to the common issues, and if their legal status is different a subclass could be established to differentiate their situation from other class members. If subsequent to certification, differences among class members become material, they can be dealt with either through sub-classes or as individual issues:"

JUDGE DISQUALIFICATION

Gautam (c.o.b. Cambie General Store) v. Canada Line Rapid Transit Inc., 2009 BCSC 1013: Defendants applied to disqualify the case management judge on the basis that the same court had already ruled against the defendants in an individual action regarding the same issues. The court rejected the application stating: "The finding was specific to the plaintiff in that action. Nothing in the reasons suggests that the finding of fact in respect of Heyes will apply to any other merchant operating on Cambie Street be-tween 2nd and 37th Avenues. For any trier of fact, the factual determination will turn on the evidence adduced in respect of the plaintiff or plaintiffs in any other action."

JURISDICTION

Stanway v. Wyeth Canada Inc., S.C., Gropper J., Doc. 2008 BCSC 847:: Court found jurisdiction on the CJPTA against US companies in products liability suit.

Bouchard c. Ventes de Véhicules Mitsubishi du Canada Inc., 2009 CF 852: Federal Court held that it had no jurisdiction over the foreign defendants. The court also deferred the filing of defence by the Canadian defendant.

APPEALS

Ring v. Canada, 2009 NLCA 45: Leave denied from decision refusing to allow evidence filed in class action in Newfoundland to be used in another jurisdiction.

Instaloans Financial Solution Centres (B.C.) Ltd. v. Tracy (Representative ad litem of), [2009] S.C.C.A. No. 194: Leave denied of decision in favour of class on merits.

Law Foundation of Ontario v. Sun Life Assurance Company of Canada, [2009] S.C.C.A. No. 226: Leave denied in this case (otherwise known as Ruffallo) seeking court's input on whether costs were properly payable by the Fund.

De Wolf v. Bell ExpressVu Inc., 2009 ONCA 644: Appeal allowed from decision that certain administrative fees constitution a criminal rate of interest.

Tiboni v. Merck Frosst Canada Ltd., [2009] O.J. No. 3731 (Div.Ct): Court declined to overturn finding that Allan Rock was in conflict of interest in this drug case given his role as former Minister of Health.

Contat v. General Motors du Canada ltée, 2009 QCCA 1699: Appeal from decision refusing certification dismissed. Plaintiff knew of the availability of the rebate of approximately $1,000 for cash purchases. He nonetheless executed the conditional sales contract on the basis of financing. In such circumstances, he did not appear to have a valid claim for damages. Because Plaintiff personally had no claim , he was not in a position to adequately represent the group. The proposed group was also overinclusive as it was not appropriate to include those who paid cash as they suffered no prejudice. In considering the class defn, the court did comment that "In certain circumstances, a Motions judge may redefine the group proposed by the applicant by changing its scope". However, the court did not err in declining to redefine the group in this case.

Seidel v. Telus Communications Inc., 2009 BCCA 383: Court found that it could award costs of the appeal, since the motion occurred prior to certification, and was not properly characterized as public interest litigation.

Griffin v. Dell Canada Inc., [2009] O.J. No. 3438 (S.C.): Leave denied from decision certifying computer defect case.

Coll c. Syndicat des cols bleus regroupés de Montréal (SCFP, section locale 301) [2009] S.C.C.A. No. 237: Leave denied of dismissal of class action on the merits.

Latreille v. Industrielle-Alliance (L'), compagnie d'assurance sur la vie, 2009 QCCA 1575: Dismissal of class claim affirmed on the merits.

Alberta (Director of Child Welfare) v. C.H.S., 2009 ABCA 271: Application for fresh evidence dismissed.

Barbour v. University of British Columbia, 2009 BCCA 334: Stay ordered of trial judgment pending appeal of parking fee case. Funds collected would be held in trust.

Gourdeau c. Syndicat général des professeures et professeurs de l'Université de Montréal, 2009 QCCA 1483: Leave to appeal refusal to strike refused.

CHICKENS AND EGGS

Martin v. Astrazeneca Pharmaceuticals PLC, [2009] O.J. No. 3847 (S.C.): Summary judgment v. certification. Justice Cullity ordered that the summary motion should not proceed first stating:

"In this motion the defendants seek to have the issues of specific causation affecting the claims of the plaintiffs dealt with prior to certification on a motion under Rule 20...In cases where it is not readily apparent from the material before the court that the plaintiff has no claim, the correct approach to a discretionary determination of the order in which motions should be heard was addressed by Winkler J. (as he then was) in the following passages in Attis v. Canada (Minister of Health) (2005), 75 O.R. (3d) 302 (S.C.J.) and Baxter v. Canada Attorney General, [2005] O.J. No. 2165 (S.C.J.)...I believe it must now be taken as settled in this jurisdiction, that the first step in a proceeding commenced under the CPA will normally be to determine whether it can properly be conducted as a class proceeding -- a question that turns on whether the requirements for certification in section 5 of the Act are satisfied. The rule is not inflexible and the court has a discretion to permit other prelimi-nary motions where this may serve the goal of litigation efficiency by eliminating or reducing ex-penditures of resources and time, or otherwise advance the objectives of the CPA. Neither the existence of the general rule nor the discretion of the court was in dispute on the motion....Although in clear cases like Stone and Punit it may be appropriate for the court to intervene before certification, success for the class is not generally conditioned on the validity of a plaintiff's claims....Motions for summary judgment were specifically identified in Attis and Baxter as examples of those that in appropriate cases might be permitted in an exercise of the court's discretion. Defendants' counsel cited numerous cases in which the motions have been permitted. In many of them the question of priority was not considered and there is nothing in the court's reasons to suggest that any objection was taken by the responding parties. These cases, and those in which the question was raised and the court's discretion exercised in favour of the moving parties, most commonly raised discrete issues of law that potentially affected the claims of all class members and, although not strictly binding on anyone other than the plaintiffs, were likely to have had the practical effect of leading to an abandonment of the claims of the other class members, an early settlement or a nar-rowing of the issues to be tried. ...Other factors that may be relevant to an exercise of the discretion are the likely delays and expense to be incurred in documentary productions and examinations of affiants -- relative to those of a certification motion -- in cases like this where questions of fact will be in issue and expert evidence may determine whether summary judgment will be granted. By way of contrast -- and not-withstanding the relevance of the same principles under section 5(1)(a) of the CPA and rule 21.01(1)(b) -- motions to strike under that rule are made without evidence and may more frequently be allowed to proceed first in order to achieve a possible saving of time and expense in preparing to address the other requirements for certification....19 In the proposed motion for summary judgment the defendants would attack only the factual merits of the plaintiffs' claims. For this purpose they would rely on expert evidence that neither of the principal plaintiffs could establish specific causation. The decision would not bind other class members and would not necessarily decide anything of relevance to the issues of specific causation on which their claims will depend and which will be decided only if certification is granted and the common issues are decided in favour of the class. There is nothing in the evidence before me to suggest that this is one of the cases referred to in Baxter in which summary judgment would benefit all parties....After the defendants informed plaintiffs' counsel of their intention to move for summary judgment -- but before the motion record was served -- the latter indicated that their clients intended to amend the statement of claim to add another plaintiff. They also informed me that there are several other individuals who are potential substitutes. In consequence, there would be no guarantee that summary judgment against the plaintiffs would end the litigation on behalf of the other class members and nothing to prevent successive motions for summary judgment as new plaintiffs are proposed..... Counsel would not preclude the possibility that there might be a series of summary judgment motions if, and as, prospective new plaintiffs were identified. Unless the defendants were prepared to do this, the motion for summary judgment in respect of the present plaintiffs could accomplish nothing of significance for the resolution of the claims of the class. Neither judicial economy nor the interests of an expeditious proceeding would be advanced and it could not be said that the mo-tion, or motions, would have the "positive effect of narrowing issues, focusing the case and moving the litigation forward"...If the individual issues of fact affecting the validity of the plaintiffs' claims are left to be de-termined at the end of the litigation with those affecting the claims of the other class members -- as I believe they should -- it will be necessary to resolve them only if the proceeding has been certified and the common issues decided in favour of the class. In these circumstances, an application of the general rule that certification motions have priority would, in my opinion, be in the interests of judicial economy, more efficient, more consistent with the structure of the CPA, and more conducive to an achievement of its goal of access to justice in that a successful defence to the plaintiffs' claims would not prevent other class members from recovering damages in the proceeding...This is not a case like Stone in which, at the time the propriety of the motion was considered, it was clearly apparent that the plaintiff had no valid claim."

EVIDENCE

Martin v. Barrett, [2009] O.J. No. 3947 (S.C.): Plaintiffs moved to strike affidavit filed by defendants on summary judgment. Certain paragraphs struck.

Metzler Investment GMBH v. Gildan Activewear Inc., [2009] O.J. No. 3394 (S.C.): Defendant applied to strike private investigator affidavit purporting to give anonymous information from former employees. The court struck the affidavit stating: "I agree with the defendants that r. 39.01(4) must be complied with and as set out below, Ms. Schulman's affidavit is not compliant. The information outlined in Ms. Schulman's affidavit is highly contentious, another reason why these are not appropriate circumstances for there to be relief from compliance with r. 4.02." The court also noted: "In my view, it is clear that the five informants conveyed their information to Ms. Schulman without any expectation of privacy. I agree with the defendants that they either did not seek any confidentiality or spoke with exact knowledge that no confidentiality was promised."

Schroeder v. DJO Canada Inc., 2009 SKQB 169: Products liability class action. Defendant applied to cross-examine affiants on certification motion, and to require medical record production. The court granted the motion to cross-examine stating: "I am convinced that the cross-examinations sought will assist in the ultimate determination of the certification application that it is therefore appropriate to exercise my discretion in favour of granting the requested relief. Although determining issues such as the adequacy of the representative plaintiffs may be relatively simple, the question of whether common issues exist and predominate over other issues and whether the class action procedure is the preferable procedure may require a more extensive record. Permitting the requested cross-examinations will ensure that an adequate evidentiary record is before the Court. Accordingly, the defendants' request to cross-examine the plaintiff affiants is granted".

The court also ordered the production of medical records stating: "It follows that it would be similarly appropriate to afford the defendants the same right, on the same basis, respecting medical and hospital records. In other words, to ensure a comprehensive record, the defendants ought to be entitled to obtain, in advance of the cross-examination on the affidavits, any material, x-rays or documents that have a bearing on the certification application." (at para.58)

The Court also declined to order the addition of manufacturer as defendant on motion of the other defendants. The manufacturer consented to being added. The court refused to add them, stating that the proper route was for them to be added as third parties. The court stated: "Given the nature of class action proceedings and the general deference that ought to be afforded to plaintiffs in drafting their claims as they see fit, it would be contrary to the spirit and intent of the legislation to "force" the plaintiff to sue a party that they chose not to pursue." The court distinguished the earlier decision in Sorotski v. CNH Global N.V., 2005 SKQB 89 stating: "It is also noteworthy that Sorotski, decided on February 16, 2005, was rendered at a time when the class action proceeding was a relatively new process in this Province."

Ménard c. Québec (Sous-ministre du Revenu), 2009 QCCS 3391: Defendant applied to examine the representative plaintiff. The court found that the examination was not necessary to assist certification.

Pearson v. Inco Ltd., [2009] O.J. No. 3034 (S.C.): Motion to compel answers from exam of Plaintiff's experts considered.

FEES

Lawrence v. Atlas Cold Storage Holdings Inc., 2009 ONCA 690: Appeal asking for increase in $6.3 million fee to the $12 million requested was rejected. The court did confirm that class counsel ave standing to appeal a fee order. The court stated: "the approved fee represents nearly twice the full docketed fee. I agree with the motion judge's observation that a fee in this range would be more than adequate incentive to solicitors to take on and prosecute an action of this nature." (at para.32) The court awarded costs of $10,000 to the objector respondents payable by class counsel.

Power c. Bristol-Myers Squibb Company, 2009 QCCS 4070: Motion to approve supplementary fees of $108,022.04 approved.

AMENDMENTS

Lorrain c. Pétro-Canada, 2008 QCCS 6839: Plaintiff sought to amend pleadings prior to certification. Motion granted in part.

Option Consommateurs c. Merck Frosst Canada ltée, 2009 QCCS 3794: Application to amend motion for certification granted.

Perreault c. McNeil PDI inc., 2009 QCCS 3245: Court granted requested amendments to expand the case to further drugs, saying that the ability of the rep to represent drugs he and his family did not take should be considered at certification. The court also refused an application to intervene by competing counsel whose action would be stayed if this particular action were broadened.

Spieser c. Canada (Procureur général), 2009 QCCS 4042: In this certified environmental class action, the class definition was amended. The court disallowed amendments adding new contamination products as that would be a fundamental change to the basis for certification. The court also adjusted some of the common issues at the defendant's request.

DEFENDANT CLASS ACTIONS

Sunnybrook Health Sciences Centre v. Lorenz, [2009] O.J. No. 3268 (S.C.): Employer sought declaration of a right to take a surplus from a pension plan. Court found that the required process under the CPA had not yet been met, and adjourned the motion stating: "[If] the deficiencies I have identified are remedied, and the class definition clarified, the application may be amenable to certification. The deficiencies are, however, important. In particular, I do not accept that the CPA provides a method of binding absent persons under the guise of approving a fictitious settlement. If rights are not genuinely in dispute, there will be nothing to compromise or settle." (at para.32)

NATIVE BAND REPRESENTATIVE STATUS

Ross River Dena Council v. Canada (Attorney General), [2009] 3 C.N.L.R. 348 (S.C.): Court found that band could sue in its own name rather than requiring an individual band member to serve as a representative plaintiff.

NORBOURG UPDATE

Ouimet c. Caisse de dépôt et placement du Québec, [2009] J.Q. no 7464 (S.C.): Court struck action on basis that it covered the same ground as main Pellemens action.

Pellemans c. Lacroix, 2009 QCCS 3357: Discovery issues considered.

 

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