Cole et al. v. Prairie Centre Credit Union Ltd. et al.,

• Jurisdiction: Saskatchewan
• Judge: Barclay, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Citation: 2007 SKQB 330,(2007), 305 Sask.R. 82 (QB)
• Date: 18 September 2007

Cole v. Prairie Centre Credit (2007), 305 Sask.R. 82 (QB)

MLB headnote and full text

Temp. Cite: [2007] Sask.R. TBEd. OC.006

Karla Cole, Gerry Mitchell, Tammy Pike (plaintiffs) v. Prairie Centre Credit Union Ltd., Prairie Centre Holdings Ltd., and Dinsmore Financial Ltd. and Prairie Centre Credit Union (2006) Ltd. (defendants)

(2007 Q.B.G. No. 679; 2007 SKQB 330)

Indexed As: Cole et al. v. Prairie Centre Credit Union Ltd. et al.

Saskatchewan Court of Queen's Bench

Judicial Centre of Saskatoon

Barclay, J.

September 18, 2007.

Summary:

The plaintiffs were customers of the defendant credit unions. The plaintiffs sued the defendants, alleging that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage, including emotional distress and economic loss, as a result. The statement of claim alleged breach of fiduciary duty, negligence, breach of confidence, breach of contract and violation of privacy. The plaintiffs applied to certify the action against the defendants as a class action pursuant to s. 6 of the Class Actions Act.

The Saskatchewan Court of Queen's Bench dismissed the application. The court held that pleadings did not disclose a cause of action, the plaintiffs failed to provide a factual basis that there was an identifiable class, and there was no common issue. The court was also not satisfied that a class action would be a preferable procedure or that there was an adequate representative plaintiff.

Banks and Banking - Topic 705

Duties of banks - Duty of confidentiality - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage as a result - The plaintiffs applied to certify the action against the defendants as a class action - The statement of claim alleged, inter alia, that the defendants breached their contracts with the plaintiffs to preserve the secrecy and confidential nature of the plaintiffs' confidential information - The Saskatchewan Court of Queen's Bench held that the plaintiffs had not pleaded sufficient or any facts to support their allegations that there was a breach of contract or that there was a contract - Accordingly, the statement of claim did not disclose a cause of action for breach of contract - See paragraphs 37 to 39.

Banks and Banking - Topic 745

Duties of banks - Fiduciary relationships - Conditions precedent - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage as a result - The plaintiffs applied to certify the action against the defendants as a class action - The statement of claim alleged, inter alia, breach of fiduciary duty - A characterization of the claim was that the defendants were in the position of a fiduciary by reason of receiving confidential information - The Saskatchewan Court of Queen's Bench held that the statement of claim did not disclose a reasonable cause of action based on fiduciary duty - Unless provided otherwise by express contract, the general standard required of banks in the performance of banking services for customers was one of reasonable care - A fiduciary relationship could arise in exceptional circumstances where the customer was vulnerable and relied on the bank for advice, and that vulnerability and reliance was known to the bank - There was no such allegation here - See paragraphs 23 to 28.

Banks and Banking - Topic 1445

Liability of banks to customers - Duties of bank - Duty of confidentiality - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage as a result - The plaintiffs alleged that a third party had obtained a computer from the town landfill and that when the computer was turned on the words "Property of Prairie Centre Credit Union" appeared on the screen - The information on the hard drive could not be accessed and the computer "fried" shortly thereafter - The plaintiffs applied to certify the action against the defendants as a class action - The statement of claim alleged, inter alia, negligence - The Saskatchewan Court of Queen's Bench held that the plaintiffs' allegations that the defendants were negligent in releasing the confidential information were not supported by any facts - Accordingly, the statement of claim did not disclose a reasonable cause of action for negligence - See paragraphs 29 to 32.

Equity - Topic 3607

Fiduciary or confidential relationships - Relationships which are not fiduciary - [See Banks and Banking - Topic 745 ].

Equity - Topic 3904

Fiduciary or confidential relationships - Breach of confidence - Elements of action for - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage as a result - The plaintiffs applied to certify the action against the defendants as a class action - The statement of claim alleged, inter alia, breach of confidence - The Saskatchewan Court of Queen's Bench held the statement of claim did not disclose a reasonable cause of action for breach of confidence - There was no allegation that the defendants had misused the information to the detriment of the plaintiffs - Furthermore, there was no allegation of profit or benefit accruing to any defendant from an alleged breach of the plaintiffs' confidence, which was also a condition precedent in establishing a cause of action - See paragraphs 33 to 36.

Practice - Topic 208

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class or representative actions - For damages - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage, including emotional distress and economic loss, as a result - The plaintiffs alleged that a third party had obtained a computer from the town landfill and that when the computer was turned on the words "Property of Prairie Centre Credit Union" appeared on the screen - The information on the hard drive could not be accessed and the computer "fried" shortly thereafter - The plaintiffs applied to certify the action against the defendants as a class action - The Saskatchewan Court of Queen's Bench held that the pleadings did not disclose a cause of action for damages for economic loss - The plaintiffs had not pled any facts which supported the allegation that they suffered economic loss - The court stated that "The claim as pled cannot be characterized as having any air of reality. The fact that someone may have a computer that may have belonged to the defendants and that may contain information about its members and which information could not be accessed as the computer became 'fried' does not lead the court to conclude that the plaintiffs have an arguable case as the whole claim is based on speculation and conjecture" - See paragraphs 56 to 64.

Practice - Topic 209.1

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class actions - Members of class - General - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage, including emotional distress and economic loss, as a result - The plaintiffs alleged that a third party had obtained a computer from the town landfill and that when the computer was turned on the words "Property of Prairie Centre Credit Union" appeared on the screen - The information on the hard drive could not be accessed and the computer "fried" shortly thereafter - The plaintiffs applied to certify the action against the defendants as a class action - The Saskatchewan Court of Queen's Bench held that the plaintiffs failed to provide a factual basis upon which it could conclude that there was an identifiable class in relation to the claims - There was no evidence that the claim was widely shared by members of the proposed class - The court stated that "at best, the plaintiffs' complaints come from their alleged anxiety because of their hearsay 'knowledge' of what was found and the possibility of a breach in the future" - There was no evidence that any other members of the credit union had knowledge of the matter - See paragraphs 65 to 72.

Practice - Topic 209.4

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class actions - Certification - Appointment of representative plaintiff - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage as a result - The plaintiffs alleged that a third party had obtained a computer from the town landfill and that when the computer was turned on the words "Property of Prairie Centre Credit Union" appeared on the screen - The information on the hard drive could not be accessed and the computer "fried" shortly thereafter - The plaintiffs applied to certify the action against the defendants as a class action - The Saskatchewan Court of Queen's Bench held that the proposed representative plaintiff (Pike) was not suitable to represent the proposed class - The court stated that "One questions her suitability and her responsibility to protect the interests of the class. She no longer resides in the community where the cause of action arose and her dealings with the community, by her own admission, are limited. When she first became aware of the lost computer she did not contact the defendant credit union in an attempt to ascertain what happened or to prevent a loss if there was a loss. The only step that was taken was for her to obtain legal advice. One again questions her claim to represent the best interests of all the members. She has also not undertaken any effort to contact any further members or garner support for this action. Lastly, the litigation plan is generic at best with no thought for detail" - See paragraphs 80 to 81.

Torts - Topic 5410

Invasion of privacy - General - Violation of privacy - Statutory tort - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage as a result - The plaintiffs applied to certify the action against the defendants as a class action - The statement of claim alleged, inter alia, a violation of privacy as contemplated by the Privacy Act - The Saskatchewan Court of Queen's Bench held that the statement of claim did not disclose a cause of action for invasion of privacy as it was a condition precedent for the action to succeed that the plaintiffs establish a wilful violation of their privacy without claims of right by a defendant - See paragraphs 40 to 46.

Torts - Topic 8701

Duty of care - Particular relationships - Claims for nervous shock and emotional suffering - General - The plaintiffs were customers of the defendant credit unions - The plaintiffs alleged that the defendants improperly discarded computers which contained confidential information provided by the plaintiffs about their person and identity and that the plaintiffs suffered damage, including emotional distress and economic loss, as a result - The plaintiffs applied to certify the action against the defendants as a class action - The Saskatchewan Court of Queen's Bench held that the necessity of physical symptoms to accompany emotional distress remained a requirement for tort damages and a damage claim for emotional distress could not succeed - See paragraphs 51 to 55.

Cases Noticed:

Hoffman et al. v. Monsanto Canada Inc. et al., [2004] 4 W.W.R. 632; 233 Sask.R. 112; 2003 SKQB 174, refd to. [para. 4].

Hollick v. Metropolitan Toronto (Municipality) et al., [2001] 3 S.C.R. 158; 277 N.R. 51; 153 O.A.C. 279; 2001 SCC 68, refd to. [para. 12].

Frey et al. v. BCE Inc. et al. (2006), 282 Sask.R. 1; 2006 SKQB 328, refd to. [para. 13].

Cloud et al. v. Canada (Attorney General) et al. (2004), 192 O.A.C. 239; 73 O.R.(3d) 401 (C.A.), refd to. [para. 14].

Abdool et al. v. Anaheim Management Ltd. et al. (1995), 78 O.A.C. 377; 121 D.L.R.(4th) 496 (Div. Ct.), refd to. [para. 15].

Hoffman et al. v. Monsanto Canada Inc. et al. (2003), 242 Sask.R. 286; 2003 SKQB 564, refd to. [para. 18].

Collins v. McMahon et al., [2002] Sask.R. Uned. 96; [2002] S.J. No. 318; 2002 SKQB 201, refd to. [para. 20].

Hoffman et al. v. Monsanto Canada Inc. et al. (2005), 264 Sask.R. 1; 2005 SKQB 225, refd to. [para. 21].

Baskerville et al. v. Thurgood, [1992] 5 W.W.R. 193; 100 Sask.R. 214; 18 W.A.C. 214 (C.A.), refd to. [para. 25].

International Corona Resources Ltd. v. LAC Minerals Ltd., [1989] 2 S.C.R. 574; 101 N.R. 239; 36 O.A.C. 57, refd to. [para. 26].

Frame v. Smith and Smith, [1987] 2 S.C.R. 99; 78 N.R. 40; 23 O.A.C. 84, refd to. [para. 26].

Dassen Gold Resources Ltd. et al. v. Royal Bank of Canada, [1995] 1 W.W.R. 171; 161 A.R. 161 (Q.B.), affd. [1997] 9 W.W.R. 658; 200 A.R. 241; 146 W.A.C. 241 (C.A.), refd to. [para. 27].

Tottrup v. Alberta (Minister of the Environment) - see Tottrup v. Lund et al.

Tottrup v. Lund et al., [2000] 9 W.W.R. 21; 255 A.R. 204; 220 W.A.C. 204; 2000 ABCA 121, refd to. [para. 31].

Rogers & Rogers Inc. v. Pinehurst Woodworking Co., [2005] O.T.C. 1130; 14 B.L.R.(4th) 142 (Sup. Ct.), refd to. [para. 35].

Taylor et al. v. Scurry Rainbow Oil Sask. Ltd. (2001), 207 Sask.R. 266; 247 W.A.C. 266; 203 D.L.R.(4th) 38; 2001 SKCA 85, refd to. [para. 36].

May et al. v. Saskatchewan, [2006] 9 W.W.R. 89; 277 Sask.R. 21; 2006 SKQB 145, refd to. [para. 38].

Peters-Brown v. Regina District Health Board et al., [1996] 1 W.W.R. 337; 136 Sask.R. 126 (Q.B.), refd to. [para. 43].

S.J.K. v. Chapple et al. (1999), 179 Sask.R. 124 (Q.B.), refd to. [para. 44].

Fontaine v. Loewen Estate, [1998] 1 S.C.R. 424; 223 N.R. 161; 103 B.C.A.C. 118; 169 W.A.C. 118, refd to. [para. 48].

Brooks et al. v. Canadian Pacific Railway Ltd. et al. (2007), 298 Sask.R. 64; 2007 SKQB 247, refd to. [para. 53].

Hoffman et al. v. Monsanto Canada Inc. et al., [2007] 6 W.W.R. 387; 293 Sask.R. 89; 397 W.A.C. 89; 2007 SKCA 47, refd to. [para. 59].

Western Canadian Shopping Centres Inc. et al. v. Dutton et al., [2001] 2 S.C.R. 534; 272 N.R. 135; 286 A.R. 201; 253 W.A.C. 201; 2001 SCC 46, refd to. [para. 74].

Rumley et al. v. British Columbia, [2001] 3 S.C.R. 184; 275 N.R. 342; 157 B.C.A.C. 1; 256 W.A.C. 1, refd to. [para. 74].

Samos Investments Inc. v. Pattison et al., [2001] B.C.T.C. 1790; 22 B.L.R.(3d) 46 (S.C.), affd. [2003] 4 W.W.R. 39; 178 B.C.A.C. 298; 292 W.A.C. 298 (C.A.), refd to. [para. 74].

Fehringer v. Sun Media Corp. et al., [2002] O.T.C. 805; 27 C.P.C.(5th) 155 (Sup. Ct.), refd to. [para. 74].

Spencer v. Regina (City) et al. (2003), 231 Sask.R. 68 (Q.B.), refd to. [para. 74].

Authors and Works Noticed:

Linden, Allen M., and Feldthusen, Bruce, Canadian Tort Law (8th Ed. 2006), p. 425 [para. 54].

McNairn, Colin H.H., and Scott, Alexander K., Privacy Law in Canada (2001), c. 3, pp. 76, 77 [para. 45].

Waters, Donovan W.M., The Law of Trusts in Canada (2nd Ed. 1984), pp. 712 to 714 [para. 25].

Counsel:

E.F. Anthony Merchant, Q.C., and Patrick G. Alberts, for the plaintiffs;

Shaunt Parthev and Michael Colewell, for the defendants.

This application was heard before Barclay, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Saskatoon, who delivered the following judgment on September 18, 2007.