Assessing Damages in Class Actions

• Author: Mr. Justice Warren K. Winkler, Patricia D.S. Jackson, and C. Scott Ritchie, Q.C.
• Pages: 1-22

Assessing

Damages

in

Class Actions

Mr.

Justice

Warren

K.

Winkler,

Patricia

D.S.

Jackson,

& C.

Scott

Ritchie,

Q.C.*

A.

INTRODUCTION

Although

the

Class

Proceedings

Act,

2002

(CPA)

was first

introduced

in On-

tario

in

1993,

there

is

very little case

law

providing guidance

on

assessing

damages

in

class actions.

The few

cases that have gone

to

trial

or

that have

dealt

with damages within

the

framework

of

certification

are

difficult

to

reconcile.

This paper focuses

on the

decided cases dealing with

damages,

the

guidance provided therein,

and the

questions

on

damages that remain

to

be

addressed.

In

particular,

we

explore

how

damage issues should

be

addressed

on

certification

and

when

it is

appropriate

to

frame

damages,

and

particularly aggregate

damages,

as a

common issue.

We

also deal

with

the

importance

of

addressing damages

in the

litigation plan required

by

the

CPA.

Put

simply,

the

plan must show

how the

resolution

of the

common issues, which

may

include

damages,

is a

substantial ingredient

of

each class member's claim

and

assess

the

relative importance

of the

resolution

of

those common issues

in

relation

to the

claim

as a

whole.1

*

Warren

K.

Winkler,

Regional Senior Justice,

Ontario,

Superior Court

of

Justice;

Patricia

D. S.

Jackson, Torys LLP;

& C.

Scott

Ritchie,

Q.C.,

Siskind,

Cromarty,

Ivey

&

Dowler

LLP

(London).

i

Class

Proceedings

Act, 1992,

S.0.1992,

c. 6

[CPA],

s.

5(i)(e)(ii);

Bellaire

v.

Independent

Order

of

Foresters,

[2004]

OJ.

No.

2242

at

paras.

52-54

(S.C.J.);

Caputo

v.

Imperial

To-

bacco

Ltd.

(2004),

44

C.P.C.

(5th)

350 at

para.

75

(S.C.J.);

Ragoonanan

v.

Imperial

Tobacco

Canada

Ltd.,

[2005]

OJ. No.

4697

(S.C.J.).

i

2 MR.

JUSTICE WARREN

K.

WINKLER,

PATRICIA

D.S.

JACKSON,

& C.

SCOTT RITCHIE

B.

BACKGROUND

Any

discussion

of

assessing damages

in

class actions requires

an

under-

standing

of the

structure

and the

goals

of the CPA and the

provisions

relating

to

certification

and

damages.

It is

fundamental

to

remember that

the CPA is

procedural only:

it is not

substantive.

It is a

vehicle

for

dealing

with complex actions where

a

large number

of

plaintiffs

are

harmed

in a

similar

manner.

The CPA has

three principal goals: access

to

justice,

ju-

dicial

economy,

and

behaviour

modification.2

Since

the

CPA's

enactment,

three class proceedings have reached

the

Supreme Court

of

Canada.3

Those cases dealt primarily with

certification

but

provide important

guidance

regarding

how the

Courts should approach this remedial leg-

islation.

In

Hollick,

McLachlin

C.J.C.,

speaking

for the

Court, stated:

The Act

reflects

an

increasing recognition

of the

important advantages

that

the

class action

offers

as a

procedural tool.

...

class actions provide

three important advantages over

a

multiplicity

of

individual suits.

First,

by

aggregating similar individual actions, class actions serve judicial

economy

by

avoiding unnecessary duplication

in

fact

finding and

legal

analysis. Second,

by

distributing

fixed

litigation costs amongst

a

large

number

of

class members, class actions improve access

to

justice

by

making

economical

the

prosecution

of

claims

that

any one

class

mem-

ber

would

find too

costly

to

prosecute

on his or her

own. Third, class

actions serve

efficiency

and

justice

by

ensuring

that actual

and

poten-

tial

wrongdoers

modify

their behavior

to

take

full

account

of the

harm

they

are

causing,

or

might cause

to the

public.4

i)

The

Structure

of the CPA

The CPA is a

comprehensive piece

of

procedural legislation which gives

significant

power

to the

case management judge

who

hears

all

motions.5

Once

a

class action

has

been

certified,

the

court

is

required

to

make

an

order setting

out

when

and by

what means

the

notice

of

that

certifica-

tion

is to be

given.6

The

parties

may

then proceed

to a

trial

of the

com-

mon

issues

following

which,

if

individual issues remain

outstanding,

2

Hollick

v.

Toronto

(City),

[2001]

3

S.C.R.

158;

Report

on

Class

Actions (Toronto: Ontario

Law

Reform

Commission, 1982).

3

Hollick

v.

Toronto

(City),

ibid.;

Rumley

v.

British

Columbia,

[2001]

3

S.C.R. 184;

Western

Canadian

Shopping

Centres

Inc.

v.

Dutton,

[2001]

2

S.C.R.

534.

4

Hollick

v.

Toronto

(City),

ibid,

at

para.

15.

5

CPA,

supra

note

i

at ss. 12 and 34.

6

Ibid,

at ss.

17-22.