By Victoria Delicata, 2L
The Ontario Superior Court of Justice has offered its first interpretation of the legislative amendments to the certification test. As outlined by Justice Perell in Banman v Ontario (“Banman”), and reaffirmed by Justice Akbarali in Grozelle v Corby Spirit and Wine Limited (“Grozelle v Corby Spirit”), the new preferable procedure criteria create a more “rigorous” and “stricter” threshold for proposed representative plaintiffs to meet. It is important to inquire about what this stricter test means for those pursuing certification of an action as a class proceeding.
Outline of the New Amendments
Section 5(1.1) of the Class Proceedings Act, 1992 now dictates that a class proceeding will be the preferable procedure to resolve common issues only if (a) it is superior to all reasonable alternatives for addressing the claim and for determining whether class members should obtain relief, and (b) the common issues of the proposed class members predominate over any individual issues. Although the British Columbia statute has always included predominance and superiority as factors to consider, only Ontario and Prince Edward Island impose these factors as mandatory pre-conditions to certification.
Banman v Ontario
In Banman, it was alleged that between 1976 and 1992, 429 patients of the Psychological Treatment Unit of the St. Thomas Psychiatric Hospital were harmed and injured by the Psychological Treatment Program. The plaintiffs sought to certify their action as a class action against the Government of Ontario and the Attorney General of Ontario. However, the Court determined that the Attorney General was not a proper party and the plaintiffs could only pursue the action against the Government of Ontario.
In determining whether the action should be certified as a class proceeding, Justice Perell considered the legislative amendments to the preferability analysis. He confirmed that section 5(1.1) imposes a “stricter test” for plaintiffs in accordance with legislative intent. When he introduced the legislative amendment, the Attorney General stated that the goal was to “make certification more rigorous” (p 6970).
Within the preferability analysis, Justice Perell highlighted that it must be determined whether (a) the way the class action is designed is manageable, (b) other reasonable means for addressing the claim can be identified, (c) the common issues of the proposed class members predominate over individual issues, and (d) the proposed class proceeding is superior to the other reasonable means identified. Despite this heightened standard, he confirmed that courts must still compare the reasonable alternatives having regard to access to justice, judicial economy, and behaviour modification. Further, in considering whether the common issues of the proposed class members predominate over their individual issues, Justice Perell stated that courts must consider whether the common issues “taken as a whole” predominate over individual issues.
Overall, Justice Perell found that sections 5(1)(d) and 5(1.1) had been met in this case, regardless of the stricter test that stems from the recent legislative amendments. He concluded that the design of the proposed class proceeding was manageable. While he found there were several reasonable alternatives to a class proceeding, including individual trials, a joinder action, and multiple joinder actions, he concluded that the class proceeding was superior to them. Furthermore, while the individual issues facing class members with “economically viable assault or sexual assault claims” predominated over their common issues, the common issues of the class as a whole still predominated over the individual issues.
Grozelle v Corby Spirit and Wine Limited
A few months later, Justice Akbarali considered section 5(1.1) in Grozelle v Corby Spirit. The plaintiffs alleged that Corby was liable for damages caused to their properties which they claimed occurred as a result of a fungus stemming from emissions of whisky aging warehouses. Justice Akbarali concluded that the action should not be allowed to proceed as a class action against the named defendant because none of the five certification criteria had been met.
In conducting the preferability analysis, Justice Akbarali reaffirmed the stricter test that Justice Perell outlined in Banman. She also reaffirmed that when assessing whether the common issues of the proposed class members predominate over their individual issues, the objective of doing so is to make sure that the common issues “taken together” predominate over individual issues and promote judicial economy and access to justice.
Ultimately, she determined that the preferability criteria were not met as the individual issues would predominate over any common issues, if the Court were to have found any. There were a multitude of individual issues that would have to be determined by the courts after the common issues trial: causation and damages for negligence claims, and reasonable reliance, causation, and damages for negligent misrepresentation claims. These individual issues predominated over the common issues of the class, both in number and in the evidence needed for the courts to make determinations. Furthermore, she held that a class proceeding would not be superior to other reasonable means of addressing this action, such as conducting individual trials, and determined that a class proceeding would not greatly promote access to justice and judicial economy.
Implications
As previously noted, it is important to ask what this stricter test for the preferability analysis means for those wishing to certify an action as a class proceeding. In Banman, the Court determined that a class action was the preferable procedure because it was superior to several reasonable alternatives, and the common issues of the class, taken as a whole, predominated over the individual issues, even though the individual issues of assault and sexual assault claimants predominated over their common issues. In contrast, the Court in Grozelle v Corby Spirit determined that a class action was not the preferable procedure because the individual issues overwhelmed the common issues, both in quantity and in the scope of evidence required for plaintiffs to demonstrate damages and potentially also the elements to make out a claim for negligent misrepresentation. For these reasons, a class proceeding would not be superior to individual trials.
While there were individual issues that would need to be resolved after a common issues trial in both cases, the Court in Banman found that there were many class members who would still benefit from a common issues trial and who would be unable to achieve access to justice through other means. In contrast, the Court in Grozelle v Corby Spirit found that if the action were to be certified as a class proceeding, the individual issues trials would place the same burdens on class members as if they would have initially pursued individual actions. Thus, a class action would not greatly promote access to justice or judicial economy. The more rigorous test under section 5(1.1) will make certification more difficult where class members will face the same burdens of proving causation and damages after a common issues trial as they would litigating on an individual basis.
