Litigation

Recent Changes to Class Action Litigation in Ontario

A number of changes will soon come into effect with respect to class action lawsuits in Ontario, pursuant to Bill 161, the Smarter and Stronger Justice Act, which received Royal Assent on July 8th. The Bill includes a number of amendments to Ontario’s Class Proceedings Act. These changes come just as a dramatic increase in class action suits is expected across Canada relating to fallout from COVID-19.

The changes are broad and have not been embraced by all legal professionals in Ontario. Below, we will review the key changes to expect, and the reason some lawyers are not in favour of all of the amendments.

Primary Changes to the Class Proceedings Act Under Bill 161

There are a number of changes specific to class actions in Ontario, but some of the major changes are highlighted below:

Multi-Jurisdictional Class Actions

It is not uncommon for class actions to be commenced in more than one province with the same or similar subject matter. Under Bill 161, when these matters arise, Ontario courts will be required to consider whether the Ontario plaintiffs would be better represented by being added as plaintiffs to an action in another province. When weighing this option, Ontario courts will be required to consider the following:

  • the alleged basis of liability in each of the proceedings, and any differences in the laws of each applicable jurisdiction respecting such liability and any available relief;
  • the stage each proceeding has reached;
  • the plan required to be produced for the purpose of each proceeding, including the viability of the plan and the available capacity and resources for advancing the proceeding on behalf of the class;
  • the location of class members and representative plaintiffs in each proceeding, including the ability of a representative plaintiff to participate in a proceeding and to represent the interests of class members;
  • the location of evidence and witnesses; and
  • the ease of enforceability in each applicable jurisdiction.

In light of this amendment, Ontario courts will have the power to refuse to certify a multi-jurisdictional action if it is determined that the Ontario plaintiffs would be better represented as plaintiffs in an existing action in another province. Further, it will allow a party in another jurisdiction to request a stay of proceedings in an Ontario action if the subject matter overlaps.

Certification Process: “Superior & Predominant”

A key step in launching a successful class action is to be certified as a class action by a court. Under Bill 161, the criteria for establishing whether a case ought to be certified will become more stringent. Going forward, plaintiffs must prove that a class action is the “superior” method for resolving the matter, above all other available options.

In addition, the plaintiffs must provide that the questions of law applicable to the group as a whole predominate over any questions of law that apply to individual plaintiffs. This is a completely new requirement for certification and is expected to overcoming the certification hurdle more challenging for plaintiffs.

Mandatory Dismissal for Delay

The amendments would also create a mandatory obligation on a court to dismiss a class proceeding for delay if one of the following steps have not been taken within one year of commencement of the action:

  • the filing of a final and complete certification motion record by the representative plaintiff;
  • the parties have agreed in writing to a timetable for service of the representative plaintiff’s certification motion record, or for completion of one or more other steps required to advance the proceeding, and have filed the timetable with the court;
  • there is an order of the court that the proceeding not be dismissed and a timetable for service of the representative plaintiff’s certification motion record or for the completion of one or more other steps required to advance the proceeding; or
  • any other steps, occurrences or circumstances that may be specified by regulation.

Legal Professionals Concerned About Impact on Future Class Actions in Ontario

Ontario’s leading law reform agency, the Law Commission of Ontario (LCO), was consulted on the proposed changes to the Class Proceedings Act. However, it is not in agreement with all of the changes included in Bill 161. In July 2019, the LCO released a comprehensive report on recommendations to improve the class action process in Ontario, many of which were adopted by the drafters of Bill 161. However, the LCO does not support all of the changes included in the Bill. In an open letter to Attorney General Doug Downey, the Law Commission of Ontario expressed reservations with the changes.

The LCO seems to have the most trouble with the new rules around certification, which the LCO claims are more aligned with American class action procedure, and will serve to make the process more challenging for plaintiffs in Ontario. The LCO expressed its concerns as follows:

“These provisions fundamentally restructure class action law and policy in Ontario by shifting the CPA’s longstanding certification test strongly in favour of defendants…effectively restrict[ing] class actions and access to justice in a broad range of important cases, including consumer matters, product and medical liability cases, and any potential class actions where there may be a combination of common and individual issues.”

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