Class Proceedings

• Author: Jamie Cassels - Craig Jones
• Pages: 309-359

7. Class Proceedings

A. INTRODUCTION

A class proceeding1is a lawsuit brought by one or more individuals (the

“class representatives”) on behalf of a group of persons similarly situated

(“the class”) to assert a common claim against the same defendant or group

of defendants.2At the time of this writing, three Canadian jurisdictions

have fairly advanced jurisprudence under comprehensive class action

statutes: Quebec,3Ontario,4and British Columbia.5Of these three, Que-

bec’s law is the oldest, originating in 1978, but the class proceeding

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1 Canadian class actions statutes (with the exception of Saskatchewan’s) prefer the term

“class proceeding” to “class action,” so as to emphasize that claims may be aggregated

whether they are commenced as lawsuits or applications. Throughout this book we

use the terms “class action” and “class proceeding” interchangeably.

2 Here we deal only with plaintiffs” class actions.

3 The Quebec law is found in Code de Procédure Civile, 1978, c. 8, Book IX and the Code

civil du Québec, 1991 c. 64, ss. 2848, 2897, and 2908. Unless otherwise specified, all

references herein are to the Code de Procédure Civile [hereinafter Quebec Act; section

references denoted by Quebec art. __; reference to the Code civil will be cited as Civil

Code s. __].

4Class Proceedings Act 1992, S.O. 1992, c. 6 [hereinafter Ontario Act; section references

denoted by Ontario s. __].

5Class Proceedings Act, R.S.B.C. 1996, c. 50 [hereinafter B.C. Act; section references

denoted by B.C. s. __].

remained under-utilized6until Ontario followed in 1992 and British

Columbia in 1995. Recently, Saskatchewan,7Newfoundland,8Alberta,9and

Manitoba10 have passed similar legislation, joining other Commonwealth

jurisdictions with formal class action regimes.11 The various statutes have

many features to facilitate recovery by plaintiff groups. For instance, they

allow for the participation of subclasses and even individuals with diver-

gent interests or issues,12 as well as for the introduction of statistical evi-

dence otherwise barred.13 A province might provide financial assistance to

plaintiffs14 or otherwise modify the law of costs to reduce risk to plaintiffs.15

A common feature of class actions is the extension of limitation periods so

that potential class members’ claims are not prejudiced between filing and

certification.16

THE LAW OF LARGE-SCALE CLAIMS310

6 In fact, the filings of class actions in Quebec by 1987 represented only .04 percent of

civil claims, 1/25th of the anticipated number: W.A. Bogart, “Questioning Litigation’s

Role — Courts and Class Actions in Canada” (1987) 62 Ind. L.J. 665 at 689–90. Ward

Branch reports only 233 applications for certification in Quebec between 1984 and

1998, or an average of just over one per month: Ward Branch, Class Actions in Canada

(Toronto: Canada Law Book, looseleaf) § 4.1950.

7Class Actions Act, S.S. 2001, c. C-12.01 (came into force 1 January 2002).

8Class Actions Act, S.N. 2001, c. C-18.1 (came into force 1 April 2002).

9Class Proceedings Act, S.A. 2003, c. C-16.6.

10 Class Proceedings Act, C.C.S.M., c. C.130.

11 See, for instance, Part IVA of the Federal Court of Australia Act 1976 (the representative

proceedings provisions date from 1991 amendments); in England reform has taken

the shape of the Group Litigation Order (GLO) rules, enacted as Civil Procedure Rules

1998 (U.K.) Rules 19.10–19.15, Practice Direction 19B — Group Litigation. The GLO

rules came into force in 2000.

12 Ontario ss. 6, 25; B.C. ss. 6, 27, 28; Quebec arts. 1022, 1037.

13 Ontario s. 23; B.C. s. 30.

14 Ontario Law Society Act, S.O. s. 59.1.

15 B.C. s. 37. Although there is no statutory presumption against costs in Quebec or

Ontario, courts in the latter province at least have been reluctant to award them if the

proceedings have been “reasonably pursued”: Michael A. Eizenga, Michael J. Peerless,

& Charles M. Wright, Class Actions Law and Practice (Toronto, Butterworths, 1999) at §

12.4–12.5. There is some suggestion that this may be changing: Pearson v. Inco Ltd.,

2002 Ont. Sup. C.J. LEXIS 104 (award of costs against the plaintiff in three pre-certifi-

cation motions apparently without applying rules that differed from ordinary individ-

ual actions).

16 Ontario s. 28; B.C. s. 39. There is a difference, however, in what happens should a

class proceeding fail certification. In Ontario, the limitation period resumes on final

denial of certification. In British Columbia, the courts have interpreted virtually iden-

tical provisions to resume retroactively the running of the limitation period. Thus, in

B.C., plaintiffs who would, in absence of a class proceeding, wish to proceed individu-

ally must file their myriad suits while awaiting certification. See Eizenga et al., ibid.at

§§ 6.1–6.7.

The fact that, prior to 2002, only three provinces had in force class

action statutes demonstrates that this type of litigation was not universally

welcomed, being seen by some as an “Americanization” of Canada’s more

civilized litigative environment.17 Particularly in Canada, where defendants

usually enjoy the protection of being able to recover part of their costs if

they prevail, there has been a serious concern that legislation must be

drafted and applied in such a way as to continue to discourage frivolous

suits. To do otherwise, defence counsel fear, may lead to a climate of “arti-

ficial” or “nuisance” settlements and an increasingly litigious business

environment.18

No aspect of class actions in the United States has led to as much con-

troversy, vacillation, and hand-wringing as the suitability of the aggregate

device for handling mass-catastrophic tort claims. It is interesting to

observe, then, that Canadian class proceedings statutes appear to have been

actually drafted with such actions in mind. Consider the description provid-

ed by the Ontario Court of Appeal in the recent decision of Carom v. Bre-X:

Disasters spawn litigation. Trains collide or derail, planes crash, ships

sink, lakes and rivers become polluted, chemical factories explode, ordi-

nary people eat, drink, wear or use unhealthy or defective products. Peo-

ple — sometimes hundreds, even thousands — are injured or killed by

these events. When the crisis subsides, some of the victims turn to the

courts for redress and compensation.

One of the modern mechanisms for dealing with the litigation fallout

from major disasters is the class action …19

Class Proceedings 311

17 See, for instance, Derek J. Mullan, QC and Neo J. Tuytel, “The British Columbia Class

Proceedings Act: Will it Open the Floodgates?” (1996) 14 Can. J. Ins. L. 30; P. Iacano,

“Class Actions and Product Liability in Ontario: What Will Happen?” (1991–92) 13

C.I.L.R. 99. The litigiousness of Americans might be considerably overstated: when

adjusted for population, American court filings are in the same general range as those

in Ontario, Australia, England, and Denmark. See Marc Galanter, “Reading the Land-

scape of Disputes: What We Know and Don’t Know (and Think We Know) About Our

Allegedly Contentious and Litigious Society” (1983) 31 UCLA L. Rev. 4 at 55. Marc

Galanter, “Real World Torts: An Antidote to Anecdote” (1996) 55 Md. L. Rev. 1093 at

1104–6.

18 The Alberta Law Reform Commission’s Report on Class Action Legislation (Final Report

#85, 2000) [hereinafter Alberta Report] lists and discusses eight popularly held objec-

tions to class actions at 55–63. Most are based on issues raised in Deborah R. Hensler

et al., Class Action Dilemmas: Pursuing Public Goals for Private Gain (Santa Monica, CA:

RAND Institute for Civil Justice, 1999). Hensler’s book, incidentally, provides one of

the most comprehensive overviews of class action policy in the United States.

19 Carom v. Bre-X Minerals Ltd.(1999), 44 O.R. (3d) 173 (S.C.J.). See also the Manitoba

Law Reform Commission, Class Proceedings (Report #100) (Winnipeg: Manitoba Publi-