Chadha v. Bayer Inc. et al., (2003) 168 O.A.C. 143 (CA)

• Judge: Austin, Rosenberg and Feldman, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: Tuesday January 14, 2003
• Jurisdiction: Ontario
• Citations: (2003), 168 O.A.C. 143 (CA);2003 CanLII 35843 (ON CA);2003 CanLII 35843 (NS CA);63 OR (3d) 22;223 DLR (4th) 158;31 BLR (3d) 214;[2003] OJ No 27 (QL);119 ACWS (3d) 378;168 OAC 143;23 CLR (3d) 1;31 CPC (5th) 40

Chadha v. Bayer Inc. (2003), 168 O.A.C. 143 (CA)

MLB headnote and full text

Temp. Cite: [2003] O.A.C. TBEd. JA.015

Avininder Chadha and Renu Chadha (plaintiffs/appellants) v. Bayer Inc., Bayer Corporation and Harcross Pigments Inc. (defendants/respondents)

(C37224)

Indexed As: Chadha v. Bayer Inc. et al.

Ontario Court of Appeal

Austin, Rosenberg and Feldman, JJ.A.

January 14, 2003.

Summary:

The plaintiffs alleged that the defendants conspired to fix the price of iron oxide pigments used in various construction mater­ials, particularly bricks and inter-locking paving stones. Particularly, the plaintiffs asserted that they, and other building owners, indirectly sustained damages as a result of being forced to pay a higher purchase price. At issue was whether the plaintiffs' action should be certified as a class proceeding under the Class Proceedings Act.

The Ontario Superior Court, in a judgment reported (1999), 107 O.T.C. 36, granted the application and in supplementary reasons settled the terms of the certification order and the notice terms. The defendants sought and obtained leave to appeal.

The Ontario Divisional Court, O'Driscoll, J., dissenting, in a judgment reported (2001, 147 O.A.C. 223, allowed the appeal and set aside the order certifying the action as a class proceeding. Damage, a necessary com­ponent of the cause of action of each plain­tiff, could not be proved on a class-wide basis. Damage must be proved individually for each plaintiff, making the class action process not the preferable procedure. The plaintiffs appealed.

The Ontario Court of Appeal dismissed the appeal.

Practice - Topic 209.3

Persons who can sue and be sued - In­dividuals and corporations - Status or standing - Class actions - Certification - Considerations (incl. when class action appropriate) - The plaintiff homeowners alleged that the defendants conspired to fix the price of iron oxide pigments used in, inter alia, bricks and paving stones - Par­ticularly, the plaintiffs alleged that they and other homeowners sustained damages by having to payer a higher purchase price for their homes - At issue was whether the plaintiffs' action should be certified as a class proceeding under the Class Proceed­ings Act - The Ontario Court of Appeal affirmed that this was not an appropriate case to certify a class action - Liability was not a common issue - The evidence had assumed a pass-through of an illegal price increase, but provided no methodology for proving it or dealing with the variables affecting the end price of real property at any particular point in time - Proof of loss could not be presented on a class-wide basis as a common issue - Since damage must be proved individually for each plain­tiff (estimated to be 1.1 million), the class action process was not the preferable pro­cedure.

Cases Noticed:

Illinois Brick v. Illinois (1977), 431 U.S. 720, refd to. [para. 10].

Hollick v. Metropolitan Toronto (Munici­pality) et al., [2001] 3 S.C.R. 158; 277 N.R. 51; 153 O.A.C. 279, refd to. [para. 28].

Caputo et al. v. Imperial Tobacco Ltd. et al. (1997), 40 O.T.C. 30; 34 O.R.(3d) 314 (Gen. Div.), refd to. [para. 29].

Taub v. Manufacturers Life Insurance Co. (1998), 40 O.R.(3d) 379 (Gen. Div.), refd to. [para. 29].

Linerboard Antitrust Litigation, Re (2002), 305 F.3d 145 (C.A. 3rd Cir.), refd to. [para. 32].

Newton v. Merrill Lynch, Pierce, Fennerd Smith Inc. (2001), 259 F.3d 154 (C.A. 3rd Cir.), refd to. [para. 38].

Hanover Shoe Inc. v. United Shoe Machin­ery Corp. (1968), 392 U.S. 481, refd to. [para. 41].

Vitapharm Canada Ltd. et al. v. Hoffmann-La Roche Ltd., [2000] O.T.C. 877; 4 C.P.C.(5th) 169 (Sup. Ct.), refd to. [para. 43, footnote 2].

Robertson v. Thomson Corp. et al. (1999), 86 O.T.C. 226; 43 O.R.(3d) 161 (Gen. Div.), refd to. [para. 69].

Statutes Noticed:

Class Proceeding Act, S.O. 1992, c. 6, sect. 5(1) [para. 4]; sect. 24(1)(b) [para. 60].

Competition Act, R.S.C. 1985, c. C-34, sect. 16].

Authors and Works Noticed:

Page, William H., The Limits of State Indirect Purchaser Suits: Class Certifi­cation in the Shadow of Illinois Brick (1999), 67 Antitrust L.J. 1, pp. 36, 37 [para. 67].

Counsel:

Paul J. Pape, for the plaintiffs;

J.L. McDougall, Q.C., and Kent E. Thom­son, for the respondents.

This appeal was heard on June 3, 2002, before Austin, Rosenberg and Feldman, JJ.A., of the Ontario Court of Appeal.

The judgment of the Court of Appeal was delivered by Feldman, J.A., and released on January 14, 2003.