Recovery of Individual and Aggregate Damages in Class Actions

• Author: Harvey T. Strosberg, Q.C., William V. Sasso, and Jacqueline A. Horvat
• Pages: 379-418



RecoveryofIndividualand

AggregateDamagesin

Class Actions

Harvey T. Strosberg, Q.C., William V. Sasso,

and Jacqueline A. Horvat

A. INTRODUCTION

On Saturday November  several railwayta nkers containing

chlorinepropaneandotherammablechemicalsderailedinMissis-

saugafollowedbyanexplosionandreDuetothedangerposedby

thegasapproximatelypeoplewereevacuatedfromMississauga

shortlythereaerforsixdaysThedisruptiondamagesandlossesto

businessesandpersonallivesweresignicantWhilethiswasthelar-

gestevacuationinCanadianhistorytrainderailmentsarenotunique

InAugustafreighttrainderailednearMexicoCityreleasingover

gallonsofchlorinegasthatpoisonedthousandsandkilledtwenty

eightpersons

TheRe port on Class ActionsbytheOntarioLawReformCom-

missionCommissionthatrecommendedthereformsthatlaterfound

their way into the Class Proceedings Actcites these t rain derail-

mentsasexamplesofcasesthatillustratethedecienciesintheproced-

 HarveyTStrosbergQCandWilliamVSassoarebothpartnersofSusStros-

bergLLPSincereappreciationisextendedtoJacquelineAHorvatanassociate

partnerofSusStrosbergLLPandKarenPetersonfortheirinvaluableassistance

inthepreparationofthispaper

 OntarioLawReformCommissionReport o n Class ActionsTorontoMinistryofthe

AorneyGeneralCommissionReport

 Class Proceedings ActSOcCPA

HSWVSJAH

uresthenavailabletodealwithallegedmasswrongswherearising

outof t he same act or similar acts a number of individuals had su f-

feredinjuryordamagetotheirpersonsorpropertyTheCommission

observedthataclassactionseekingdamagesthatrequiredindividual

assessmentwouldnotbepossibleunderOntariolawinrespectofthe

MississaugatrainderailmentTheCommissionfurtherobservedthat

evenifaprocedurecouldbefoundinwhichtoobtaindeclaratoryrelief

toestablishissuesofliabilityarisingoutofthederailmentsuccessin

thatdeclaratoryprocedurewouldbebutapreludetonumerousfurther

proceedings because Ontar iol awwould requir e each person aected

bytheliabilitysodeterminedinthedeclaratoryjudgmenttoestablish

inseparateproceedingssuchindividualissuesasiwhethertheperson

twithinthecategoryofreasonablyforeseeableplaintistowhomthe

defendantsowedadutyofcareiiwhetherthedamagessoughtbythat

personwerenottooremoteandwererecoverableatlawaswellasiii

theassessmentofthatpersonsdamagestopersonandpropertyinor-

dertoobtainajudgmentformonetaryrelief

Theprincipalreasonthatrepresentativeorclassproceedingscould

notbebroughtinsituationsliketheMississaugatrainderailmentwas

becausetheorthodoxandprevailinginterpretationoftherulethatper-

miedrepresentativeorclassactionsprohibitedtheirusewheredam-

ages were claimed It was the legal requirement to prove individual

damagesforpersonalinjuriesorpropertythatprecludedanyprospect

ofthesuccessfulinstitutionofaclassactiontodealwiththeMississauga

trainderailmentoranyothermasstortorothermasswrongcase

Theoldmaximisubijusibiremediumthereisnorightwithouta

remedyThetensofthousandsofMississaugaresidentsandbusinesses

whose losses or damages did not justify the expe nse of independent

litigationwerewithoutalegalremedytovindicatetheirrightsThere-

mainingthousandsofresidentswhobelievedthattheexpensesofindi-

vidualclaimswerejustiedburdenedtheciviljusticesystemwiththeir

damageclaimseachofwhicharoseoutofthesameincident

New remedial massremedy machinery was needed to provide

meaningful remed ies in the masswrong situation where arising out

ofthesameactorsimilaractsanumberofindividualssueredinjury

ordamagetotheirpersonorpropertyWewilldealinthispaperwith

ithehistoricaltreatmentofdamageclaimsthatledtotheclasspro-

ceedingsreformsiitherationaleforandtheproceduralchangesintro-

ducedbytheCPAtoachievethemajorgoalsofclassproceedingsreform

 CommissionReportsupranoteat

Recovery of Individual and Aggregate Damages in Class Actions

judicialeconomyimprovedaccesstojusticeandbehaviourmodica-

tiontoprovidebothaggregateandindividualremediesinmasswrong

situationsiiithemannerinwhichthecourtshaveinterpretedandap-

pliedtheCPA provisionsdealingwiththetreatmentofaggregateand

individual damages in class actions a ndiv our observations on the

anticipated future use of class proce edings to achieve remedies both

aggregateandindividualforthoseaectedinthesameanddierent

waysbymasswrongs

B HISTORICALTREATMENTOF

REPRESENTATIVE OR CLASS

ACTIONS FOR DAMAGES

Therepresentativeorclassactionmaybetracedbacktothecourtsof

equityintheearlypartoftheeighteenthcenturyIncontrasttocourts

ofl awcourts of equity adopted a broad stance in dispute resolution

Courtsofequitysoughttoavoidmultiplicityofproceedingsbyadhering

tothegeneralrulethatallpersonsmateriallyinterestedinthesubject

maerofasuitaretobemadepartiestoithowevernumeroustheymay

beWhenitbecameevidentthatstrictadherencetothisgeneralinclusive

rulecouldgiverisetoinjusticethecourtsofequityresortedtorepre-

sentativeorclassactionstopermitonepersontobringasuitonbehalf

ofallpersonsmateriallyinterestedeitherlegallyorbeneciallyinthe

subjectmaerofthesuit

TheseproceduresdidnotapplytodamageclaimsDamagesbeing

acommonlawremedyweredealtwithinthecourtsoflawratherthan

equityandthereforewerenotanavailableremedyinanactionbrought

inclassforminthecourtsofequity

ThemergerofthecommonlawcourtsandcourtsofequityinEng-

landandOntariotookplaceinthelaerpartofthenineteenthcentury

Themergerresultedinasinglesetofproceduralrulesforthemerged

courtInOntariotherulescheduledtotheOntario Judicature Act

thatdealtwithrepresentativeorclassactionswasidenticaltotherule

 CommissionReportibidatJohnAKazanjianClassActionsinCanada

OsgoodeHallLJWesternCanadianShoppingCentresIncvDuon

SCRatWestern Canadian

 Victc