Harvey et al. v. Western Canada Lottery Corp., (2015) 461 Sask.R. 15 (QB)

• Judge: Schwann, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: April 09, 2015
• Jurisdiction: Saskatchewan
• Citations: (2015), 461 Sask.R. 15 (QB);2015 SKQB 102

Harvey v. Lottery Corp. (2015), 461 Sask.R. 15 (QB)

MLB headnote and full text

Temp. Cite: [2015] Sask.R. TBEd. AP.055

Guy Harvey, Shaun Pekrul, David Huntley and Marc Boily (plaintiffs) v. Western Canada Lottery Corporation (defendant)

(2009 Q.B. No. 349; 2015 SKQB 102)

Indexed As: Harvey et al. v. Western Canada Lottery Corp.

Saskatchewan Court of Queen's Bench

Judicial Centre of Regina

Schwann, J.

April 9, 2015.

Summary:

The representative plaintiffs' class action was originally premised on the proposition that Western Canada Lottery Corp. (WCLC), which offered and promoted scratch 'n win lottery games, continued to sell lottery tickets for certain games after the top prizes were awarded. The representative plaintiffs alleged that by doing so WCLC was breaching its obligations to provide some chance at winning a remaining top prize. Three weeks before the scheduled hearing of the certification application, the representative plaintiffs applied to amend their claim in the manner set out in their proposed third amended statement of claim. The plaintiffs proposed to amend their claim to plead that WCLC also removed games from the market after tickets had been purchased but before the top prizes were awarded.

The Saskatchewan Court of Queen's Bench allowed the proposed amendments, subject to further amendment designed to remedy the deficiencies identified in paragraph 47 of the court's judgment.

Editor's Note: The Saskatchewan Court of Appeal, per Ottenbreit, J.A., in a decision reported at [2015] Sask.R. TBEd. JL.029, dismissed WCLC's application for leave to appeal from this decision.

Practice - Topic 210.3

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class or representative actions - Costs - One day after all materials were filed by the defendant Western Canada Lottery Corp. (WCLC), and three weeks before the scheduled hearing of the certification application, the representative plaintiffs applied to amend their claim in the manner set out in their proposed third amended statement of claim - The Saskatchewan Court of Queen's Bench allowed the proposed amendments - The court stated that "There is strong appellate authority in support of the proposition that s. 40 of the CAA [Class Actions Act] does not prohibit an award of costs on pre-certification applications. ...  If the plaintiffs wish to amend their pleadings, expand the class and advance new theories of their case at the last minute in circumstances where they acquired knowledge of the facts giving rise to the amended pleadings months beforehand, they ought not expect WCLC to bear the additional legal costs associated with this approach. WCLC will therefore be given its costs of the application in an amount to be spoken to at the time of certification when the ramifications for WCLC's legal response is known" - See paragraphs 64 to 68.

Practice - Topic 210.5

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class or representative actions - Procedure - Pre-certification matters (incl. particulars, production, pleadings, etc.) - [See all Practice - Topic 2120 ].

Practice - Topic 210.6

Persons who can sue and be sued - Individuals and corporations - Status or standing - Class actions - Limitation of actions - [See first Practice - Topic 2120 ].

Practice - Topic 376

Parties - Joinder of parties - Joinder of plaintiffs - General - The representative plaintiffs' class action was originally premised on the proposition that Western Canada Lottery Corp. (WCLC), which offered and promoted scratch 'n win lottery games, continued to sell lottery tickets for certain games after the top prizes were awarded - The representative plaintiffs alleged that by doing so WCLC was breaching its obligations to provide some chance at winning a remaining top prize - Three weeks before the scheduled hearing of the certification application, the representative plaintiffs applied to amend their claim to plead that WCLC also removed games from the market after tickets had been purchased but before the top prizes were awarded - WCLC submitted that the proposed amendment offended the rule against joinder - The Saskatchewan Court of Queen's Bench rejected the argument - First, the cases relied on by WCLC were not class action proceedings - The general rules were to be applied only to the extent they were not in conflict with the Class Actions Act (CAA) (s. 44), or the spirit and intent of the CAA - Second, Bagaco v. Union Energy Limited Partnership (2009 Ont. Sup. Ct.) pointed out that the right to join the claims of different plaintiffs was subject to the court's overriding discretionary power to sever claims where it appeared that joinder would cause undue complication or delay, or cause prejudice to one of the parties - Those concerns had to be rationalized with the nature and purpose of class action proceedings - Third, common issues, questions of law, appropriate and identifiable class, were all matters properly considered at the time of certification - See paragraphs 57 to 60.

Practice - Topic 2120

Pleadings - Amendment of pleadings - Statement of claim - General - The representative plaintiffs' class action was originally premised on the proposition that Western Canada Lottery Corp. (WCLC), which offered and promoted scratch 'n win lottery games, continued to sell lottery tickets for certain games after the top prizes were awarded - The representative plaintiffs alleged that by doing so WCLC was breaching its obligations to provide some chance at winning a remaining top prize - Three weeks before the scheduled hearing of the certification application, the representative plaintiffs applied to amend their claim to plead that WCLC also removed games from the market after tickets had been purchased but before the top prizes were awarded - WCLC argued that the proposed amendments were unjust or prejudicial by reason of delay and cost and intervening limitation periods - The Saskatchewan Court of Queen's Bench allowed the proposed amendments - WCLC would not be prejudiced by reason of delay - The associated costs WCLC would have to bear in responding to the amendments could be addressed as a matter of costs - In light of s. 43 of the Class Actions Act, and in the absence of evidence demonstrating that the limitation period had expired, the loss of a limitation defence (if it existed) did not undermine the pursuit of certification - WCLC would be entitled to raise the limitations issue at the time of certification - See paragraphs 27 to 48.

Practice - Topic 2120

Pleadings - Amendment of pleadings - Statement of claim - General - The representative plaintiffs' class action was originally premised on the proposition that Western Canada Lottery Corp. (WCLC), which offered and promoted scratch 'n win lottery games, continued to sell lottery tickets for certain games after the top prizes were awarded - The representative plaintiffs alleged that by doing so WCLC was breaching its obligations to provide some chance at winning a remaining top prize - Three weeks before the scheduled hearing of the certification application, the representative plaintiffs applied to amend their claim to plead that WCLC also removed games from the market after tickets had been purchased but before the top prizes were awarded - WCLC argued that the proposed amendments could not survive a motion to strike because they constituted an abuse of process - WCLC submitted the proposed amendments amounted to little more than a "fishing expedition" and did not constitute a genuine issue for trial - The Saskatchewan Court of Queen's Bench found that the proposed pleading did not constitute a fishing expedition - The court stated "While the plaintiffs have yet to marshal the evidence required for a claim of this nature, the plaintiffs are only required to plead facts, not the evidence. ... To deny the proposed amendment for reasons of abuse of process when information about how WCLC manages some of its scratch'n win games came to light through WCLC itself, would, in my view, lead to a perverse result" - See paragraphs 49 to 56.

Practice - Topic 2120

Pleadings - Amendment of pleadings - Statement of claim - General - The representative plaintiffs' class action was originally premised on the proposition that Western Canada Lottery Corp. (WCLC), which offered and promoted scratch 'n win lottery games, continued to sell lottery tickets for certain games after the top prizes were awarded - The representative plaintiffs alleged that by doing so WCLC was breaching its obligations to provide some chance at winning a remaining top prize - Three weeks before the scheduled hearing of the certification application, the representative plaintiffs applied to amend their claim to plead that WCLC also removed games from the market after tickets had been purchased but before the top prizes were awarded - WCLC argued that the proposed amendments could not survive a motion to strike because they disclosed no reasonable cause of action - Essentially, WCLC contended that the stop sell allegation was bad in law and that it was plain and obvious it had no possible chance of success because it lacked connection to the existing pleadings and cause of action - The Saskatchewan Court of Queen's Bench stated that "While the pleadings leave much to be desired with regard to the specifics of the stop sell claim and the legal cause of action which springs from it, on the whole, and based on the proposed pleadings alone, it cannot be said that no reasonable cause of action exists. This ground of objection cannot prevail at this juncture and in any event is best considered within the context of certification having regard to s. 6(1) of the CAA [Class Actions Act] when the plaintiffs will need to persuade this Court that the pleadings disclose a cause of action having regard to the test and approach set out in Hoffman v. Monsanto Canada Inc" - See paragraphs 61 to 63.

Practice - Topic 2239.1

Pleadings - Striking out pleadings - Grounds - Abuse of process - Hopeless suit - [See second Practice - Topic 2120 ].

Practice - Topic 7053

Costs - Party and party costs - Entitlement to - Amendment of pleadings - [See Practice - Topic 210.3 ].

Cases Noticed:

Beemer v. Brownridge, [1934] 1 W.W.R. 545 (Sask. C.A.), refd to. [para. 22].

Field et al. v. GlaxoSmithKline Inc. (2013), 416 Sask.R. 238; 2013 SKQB 113, refd to. [para. 22].

Rekken Estate v. Health Region No. 1 et al. (2014), 453 Sask.R. 1; 2014 SKQB 271, refd to. [para. 23].

Duke v. Puts, [1998] 6 W.W.R. 510; 161 Sask.R. 299 (Q.B.), refd to. [para. 23].

Judith River Farm and Water Ltd. Partnership v. Saskatchewan (2003), 243 Sask.R. 74; 2003 SKQB 443, refd to. [para. 23].

Alves et al. v. MyTravel Canada Holidays Inc. et al. (2011), 377 Sask.R. 68; 528 W.A.C. 68; 2011 SKCA 116, refd to. [para. 23].

Sagon v. Royal Bank of Canada et al. (1992), 105 Sask.R. 133; 32 W.A.C. 133 (C.A.), refd to. [para. 24].

Rosetim Investments Inc. et al. v. BCE Inc. et al. (2011), 376 Sask.R. 264; 2011 SKQB 253, refd to. [para. 30].

Cameco Corp. v. Insurance Co. of the State of Pennsylvania et al. (2008), 310 Sask.R. 89; 423 W.A.C. 89; 2008 SKCA 54, refd to. [para. 30].

Dugal et al. v. Manulife Financial Corp. et al., [2011] O.T.C. Uned. 6761; 2011 ONSC 6761, refd to. [para. 31].

Duzan v. GlaxoSmithKline Inc. et al. (2011), 372 Sask.R. 108; 2011 SKQB 118, refd to. [para. 37].

Coulson v. Citigroup Global Markets Canada Inc. et al. (2012), 288 O.A.C. 355; 2012 ONCA 108, refd to. [para. 38].

Bellefeuille v. Canadian Pacific Railway Ltd. et al., 2010 ONSC 5499, affd. (2011), 283 O.A.C. 119; 2011 ONSC 2648 (Div. Ct.), refd to. [para. 39].

Alves et al. v. MyTravel Canada Holidays Inc. et al. (2011), 377 Sask.R. 55; 528 W.A.C. 55; 2011 SKCA 117, refd to. [para. 41].

Lipson v. Cassels Brock & Blackwell LLP et al. (2013), 303 O.A.C. 124; 360 D.L.R.(4th) 577; 2013 ONCA 165, refd to. [para. 45].

Pearson v. Inco Ltd. et al. (2005), 205 O.A.C. 30; 261 D.L.R.(4th) 629 (C.A.), refd to. [para. 56].

Schick et al. v. DowElanco Canada Inc. et al. (1996), 150 Sask.R. 109 (Q.B.), refd to. [para. 57].

Bagaco v. Union Energy Limited Partnership, 2009 CanLII 6830 (Ont. S.C.), refd to. [para. 57].

Hoffman et al. v. Monsanto Canada Inc. et al., [2005] 7 W.W.R. 665; 264 Sask.R. 1; 2005 SKQB 225, refd to. [para. 63].

Englund et al. v. Pfizer Canada Inc. et al. (2007), 299 Sask.R. 298; 408 W.A.C. 298; 2007 SKCA 62, refd to. [para. 64].

Roberts Properties Inc. v. Saskatchewan Power Corp. et al. (2014), 453 Sask.R. 115; 2014 SKQB 245, refd to. [para. 65].

Statutes Noticed:

Class Actions Act, S.S. 2001, c. 12.01, sect. 7(1) [para. 25]; sect. 40 [para. 64]; sect. 43(1) [para. 36].

Rules of Court (Sask.), Queen's Bench Rules, rule 3-72(2) [para. 21].

Authors and Works Noticed:

Eizenga, Michael A., Peerless, Michael J., and Callaghan, John E., Class Actions Law and Practice (2nd Ed. 2009) (Looseleaf), rel. 30, December 2014, p. 6-13 [para. 40].

Winkler, Warren K., Perell, Paul M., and Kalajdzik, Jasminka, The Law of Class Actions in Canada (2014), p. 89 [para. 59].

Counsel:

Anthony E.F. Merchant, Q.C., for the plaintiffs;

Robert W. Leurer, Q.C., and Jason W. Mohrbutter, for the defendant.

This application was heard before Schwann, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Regina, who delivered the following decision on April 9, 2015.