Comparison Between Canadian And Us Class Actions Law And Practice

Canadian Class Actions Law and Practice

Jill Yates
McCarthy Tétrault LLP

McCarthy Tétrault LLP / mccarthy.ca

Introduction

¬ Canadian class action legislation was originally
modeled on Rule 23 of the United States Federal
Rules of Civil Procedure, with some adjustments
¬ Canadian approach was designed to be more
conducive to bringing class actions
¬ Has proven to be true


Canadian Overview

¬ Class action legislation in eight of the nine
Canadian common law provinces and Quebec
¬ Quebec was first Canadian jurisdiction with class
actions legislation in 1978; then Ontario in 1993
and then B.C. in 1995; others more recent
¬ All but New Brunswick, Newfoundland and B.C.
are “opt-out” jurisdictions for non-resident class
members. An amendment to switch B.C. from
“opt-in” to “opt-out” has been proposed
¬ The legislation in each common law province is
similar to one another

Canadian Overview

¬ "Trilogy" of decisions by Supreme Court of
Canada in 2001 established numerous important
principles, including defining the objects of class
proceedings in Canada, which are:
¬ access to justice,
¬ judicial economy and
¬ behaviour modification
¬ These objects have informed a permissive
attitude toward class actions generally


Canadian Overview

¬ Canada does not have national legislation comparable to
Rule 23 governing class actions involving multiple
provinces
¬ Multi-jurisdictional issues are discussed further below
¬ Federal Court of Canada allows class proceedings, but is
a court of limited subject matter jurisdiction; hears claims
in areas of Federal constitutional jurisdiction including tax,
immigration and intellectual property
¬ Vast majority of Canadian class actions therefore brought
in provincial superior courts


Comparison between Certification under
Rule 23 and Canadian Legislation
¬ Lower threshold for certification under Canadian
legislation
¬ Five general requirements for certification in Canadian
common law provinces (with nuances between the
provinces):
(a) pleadings must disclose cause of action;
(b) must be an identifiable class;
(c) there must be common issues;
(d) class action must be preferable procedure by which to
resolve the case; and
(e) proposed representative plaintiff must be suitable


Rule 23 and Authorization
¬ The Quebec Code of Civil Procedure provides:

1002. A member cannot institute a class action except with
the prior authorization of the court, obtained on a motion.
1003. The court authorizes the bringing of the class action
and ascribes the status of representative to the member it
designates if of opinion that:
(a) the recourses of the members raise identical, similar or
related questions of law or fact;
(b) the facts alleged seem to justify the conclusions sought;
(c) the composition of the group makes the application of article
59 or 67 difficult or impracticable; and
(d) the member to whom the court intends to ascribe the status
of representative is in a position to represent the members
adequately.


Rule 23 and Canadian Legislation

¬ Each of the requirements for certification in
common law Canada, and for authorization in
Quebec, can be compared to the Rule 23
requirements for certification, as follows on the
following slides:


Comparison – Canadian Requirement of
Cause of Action
¬ Certification under Canadian class proceedings legislation
in common law provinces requires the pleadings disclose
a cause of action
¬ Onus on plaintiff
¬ No evidence is admissible
¬ Some courts have allowed motions to strike claim before
certification, but sequencing is within the discretion of the
case management judge
¬ In Quebec, authorization will not be granted unless the
facts alleged seem to justify the conclusions sought
¬ Pleadings must be sufficiently detailed to allow the court to
determine if the claim has any chance of success on the
merits

Comparison – “Identifiable Class” not
“Numerosity”
¬ The “identifiable class” must consist of two or more
persons in Canadian common law provinces
¬ The number of potential class members or their identity
need not be shown
¬ There must be objective criteria to identify the class
members, which are not dependent on the merits
¬ Size of class may be a factor in determining if the class
proceeding is preferable
¬ Quebec has an approach similar to numerosity, where
class representative must show mandate/joinder is
impractical


Comparison – Commonality

¬ Presence of common questions of law or fact is
a requirement of both American and Canadian
class proceedings
¬ In Canada, issue will be “common” where its
determination is necessary to the resolution of
each class member's claim
¬ Common issues need not be determinative of the
defendant's liability or of the provision of relief to
the class


Comparison – No Canadian Requirement
of “Typicality”
¬ Typicality is not explicitly required by Canadian class
proceedings legislation
¬ Factors used in analyzing typicality in the US are similar
to those considered by Canadian common law courts in
their examinations of commonality and preferability
¬ First step of Rule 23 analysis is establishing comparable
claims or defences between plaintiff and other persons;
similar investigation by Canadian courts when looking for
common issues necessary to the resolution of class
members' claims
¬ Second step of Rule 23 analysis is comparing claims and
defences of plaintiff to those of the group; similar
comparison by Canadian courts when considering
preferability


Comparison - No Canadian Requirement
of “Typicality”
¬ Analogous analysis is that Canadian courts consider the
nature of the proposed common issues and the individual
issues that would not be resolved through the class
proceeding
¬ Although the factors considered by US and Canadian
courts are similar, in practice "typicality" in US sets a
higher bar to certification than commonality and
preferability do in Canada
¬ Even where claims or defences are not typical of the class,
Canadian courts allow certification as long as they are
satisfied individual issues will not overwhelm the litigation
and become its focus
¬ Canadian courts do not often conclude individual issues will
become the focus of a case

Comparison – No Canadian Requirement
of “Predominance and Superiority”
¬ These were intentionally omitted by the government of Ontario when it
adopted the American class actions model
¬ Similarly omitted from the legislation of the other common law provinces in
Canada
¬ Result is lowered threshold for certification in Canadian common law
provinces
¬ Test in Canadian common law provinces is instead preferability, which is
assessed according to several factors including:
¬ extent to which certification furthers the objects of class action legislation
¬ presence of factors set out in the class action legislation, including
¬ whether common issues predominate,
¬ whether a significant number of class members have a valid interest in
pursuing separate actions, and
¬ whether there are other means of resolving the claims
¬ nature of the proposed common issues
¬ individual issues remaining after determination of common issues
¬ complexity and manageability of the proposed action
¬ alternative procedures to deal with the claims


Comparison – “Representative Plaintiff”
similar to “Fair and Adequate
Representation”
¬ Requirement is similar in US and Canadian class actions
¬ Canadian common law provinces require a
representative plaintiff who will:
¬ fairly and adequately represent the interests of the class;
¬ has produced an acceptable plan for the class action and
for notifying class members; and
¬ does not have a conflict of interest with the other class
members on common issues
¬ In practice, the standard is low
¬ Quebec also requires an adequate representative

Comparison - Appeals

¬ The legislation in five Canadian common law provinces,
like Rule 23, provides a right of appeal from an order
granting or denying certification, in the discretion of the
court of appeal
¬ In B.C., there is a right of appeal from every certification
decision
¬ In Ontario, there is a right of appeal from decisions
refusing certification but leave is required to appeal a
decision granting certification
¬ In Quebec, there is a right of appeal from a decision
refusing authorization but there is no right of appeal from
decisions granting authorization unless such a decision
dismisses a claim against certain defendants or excludes
proposed class members

Comparison - Notice

¬ In Canada, individual class members need not be
identified or notified in most cases
¬ The court may order any form of notice it deems
appropriate, including publication in the media
¬ Notice will depend on the nature of the case and
the nature and size of the class
¬ The court may, and often does, require the
defendant to pay the cost of giving notice


Comparison - Relief and Distribution
¬ Canadian class proceedings legislation expressly authorizes
aggregate damages awards and specifies procedures for their
distribution
¬ In common law provinces, the court may make an aggregate award
to the class if the only remaining questions relate to the assessment
of monetary relief and if the aggregate award can reasonably be
determined without proof by individual class members
¬ These prerequisites have been interpreted liberally
¬ In provinces other than Alberta, the court may use statistics
or sampling to arrive at an aggregate award
¬ Distribution may be on a proportionate or average basis
¬ Where there is a residue of undistributed funds, cy-près
distributions are permitted
¬ In common law provinces, Plaintiffs use “waiver of tort” to seek gains-
based relief


Comparison – Relief and Distribution

¬ In Quebec, if the evidence can establish the
amount of an aggregate award, the award may
be made without establishing the identity of each
class member or the exact amount of individual
claims


Other Differences between the Legal
Systems in Canada and the US
¬ Costs: in at least some Canadian provinces (including
Ontario), adverse costs awards can serve as a deterrent
to class action litigation
¬ Contingency fees: in Canada, plaintiff's counsel fees
must be approved by the court and are generally modest
by US standards
¬ Damage awards, including punitives: US awards are
usually much higher than those granted by Canadian
courts. Civil trials by jury are not as common in Canada.
There has never been a jury trial in a Canadian class
action
¬ Judicial scrutiny of settlement agreements: Canadian
judges are prepared to scrutinize settlement agreements
and look into the value received by the plaintiff class


Carriage Motions

¬ Proposed class actions seeking to represent the
same class are sometimes filed concurrently in
the same province
¬ Leads to “carriage motion” where different plaintiff
firms seek to have carriage of the lawsuit on
behalf of the class
¬ Superior Court judge, usually the case
management judge, will decide who is entitled to
carriage
¬ Defendants are spectators during this process


Multi-Jurisdictional Class Actions

¬ Duplicate class actions are often filed
concurrently in several provinces
¬ The traditional approach was to file in B.C.,
Ontario and Quebec concurrently; it is now
common for claims to be filed in all Canadian
provinces with class action legislation (all
provinces but Prince Edward Island)
¬ Constitutional issues?


Multi-jurisdictional Class Actions

¬ Within Canada, conflicts arising from multiple class actions have
typically been resolved by counsel on a consensual basis
¬ Where plaintiffs' counsel in different provinces could not agree on
which action should proceed "first", defendants could be required
to fight in more than one province concurrently
¬ The Canadian Bar Association is in the process of developing a
set of judicial protocols to help resolve such conflicts; these are
focused on notice, judicial case management and coordinated
settlement approvals
¬ Between Canada and the US, there is a continuing trend of parallel
class actions being brought
¬ ABA has recently approved protocols for Canada-US cross
border class actions, addressing coordination of notice and best
practices for court-to-court communication


VANCOUVER MONTRÉAL
Suite 1300, 777 Dunsmuir Street Suite 2500
P.O. Box 10424, Pacific Centre 1000 De La Gauchetière Street West
Vancouver BC V7Y 1K2 Montréal QC H3B 0A2
Tel: 604-643-7100 Tel: 514-397-4100
Fax: 604-643-7900 Fax: 514-875-6246
Toll-Free: 1-877-244-7711 Toll-Free: 1-877-244-7711

CALGARY QUÉBEC
Suite 3300, 421 7th Avenue SW Le Complexe St-Amable
Calgary AB T2P 4K9 1150, rue de Claire-Fontaine, 7e étage
Tel: 403-260-3500 Québec QC G1R 5G4
Fax: 403-260-3501 Tel: 418-521-3000
Toll-Free: 1-877-244-7711 Fax: 418-521-3099
Toll-Free: 1-877-244-7711
TORONTO
Box 48, Suite 5300 UNITED KINGDOM & EUROPE
Toronto Dominion Bank Tower 125 Old Broad Street, 26th Floor
Toronto ON M5K 1E6 London EC2N 1AR
Tel: 416-362-1812 UNITED KINGDOM
Fax: 416-868-0673 Tel: +44 (0)20 7786 5700
Toll-Free: 1-877-244-7711 Fax: +44 (0)20 7786 5702


Comparison Between Canadian And Us Class Actions Law And Practice

Recomendados

Recomendados

Mais conteúdo relacionado

Semelhante a Comparison Between Canadian And Us Class Actions Law And Practice

Semelhante a Comparison Between Canadian And Us Class Actions Law And Practice (20)

Comparison Between Canadian And Us Class Actions Law And Practice