Proposed Ontario changes to class action laws are facing criticism that they follow U.S. laws too closely, and unfairly favour defendant interests at the expense of groups of consumers.
The Ontario government introduced Bill 161 in early December. That bill included numerous updates to the Class Proceedings Act (CPA) which had not been revised since 1993. The CPA updates were largely drawn from the 47 recommendations provided by the Law Commission of Ontario (LCO) earlier that year. However, a set of recommendations have deviated from the LCO report, and instead appear to be following comments made by the Canadian Bankers Association and Canadian Life and Health Insurance Association in their joint submission to the LCO.
The most commonly criticized element of the proposed laws are changes to the “superiority” (is the class action the best choice when alternatives such as service programs and other dispute resolution choices exist) and “predominance” (are there significant individual issues that are greater than the collective interests) tests at the certification stage. These changes are contrary to the LCO position, and its response warned that this was a significant shift in favour of defendants which would have a “significant and negative impact on access to justice and the administration of justice.”
Applied retroactively, they noted that these changes would have prevented class action in numerous landmark cases, such as environmental tragedies in Walkerton, Ontario and price-fixing cases. The new rules are inconsistent with other provincial rules, will add costs and delays, and will give Ontario residents fewer legal rights than other Canadians. The “restrictive American legislative provisions” are “inconsistent with decades of Canadian law.” The Commission also notes that the new Crown Liability and Proceedings Act would make it more difficult for Ontario residents to initiative class actions against the provincial government, its agencies, corporations and other institutions.
Jasminka Kalajdzic, one of two principal researchers and authors of the LCO’s report, noted separately in a blog post that “almost none of the stakeholders who contributed to the LCO Class Action Project advocated for the predominance test. The only exception: a joint submission by the Canadian Bankers Association and the Canadian Life and Health Insurance Association.” She noted the new superiority and predominance tests are “radical” changes that would “take class actions backwards” and that it was especially troubling, given that so much of the bill was about modernizing the justice system. “The new superiority and predominance tests are conservative American principles that make many types of mass wrong impossible to litigate as class actions.”
In an online article published in Law Times, Sotos LLP lawyer Mohsen Seddigh also concluded U.S.-style class action tests in Ontario would make it harder for plaintiffs to use class actions. “People who will be most impacted by this are consumers, employees and anyone who is in a normally vulnerable position that needs access to justice through class actions,” he said.
Published summaries from many other leading Ontario law firms make similar points from the opposite perspective, that the proposals would favour defendants. Tory’s wrote that “many of the amendments will be beneficial to defendants and potential defendants” while others will “restrict the options available to plaintiff counsel”. Bennett Jones’ analysis concluded that “the new predominance requirement in certification is likely to limit the availability of class actions in Ontario writ large.” Norton Rose Fulbright’s commentary said that the changes “bode well for defendants and their insurers” and “would provide greater latitude to defendants seeking to narrow or dismiss claims prior to certification.”
A response from the Consumers Council of Canada to the Ontario Attorney General’s office included praise for many of the uncontroversial Bill 161 changes, but also concern that changing requirements would “impose unnecessary barriers to access to justice for consumers and other claimants.” President Don Mercer added that the preferable procedure test implies that justice through administrative tribunals and other processes is automatically superior to courts. “In the Council’s experience, this is not always the case. The ability of an aggrieved consumer to choose the civil justice system by way of class action is important, given the appropriateness of civil remedies.
“The attorney general and his office has been working with stakeholders to craft a good bill, and now the government and the legislature have an opportunity to make the one on the table better.”
The Council has published a brief document in its “Spotlight” series addressing some strengths and weaknesses of the Bill. Class Actions and Access to Justice in Ontario is available for purchase through the Council’s online content store. The Council is seeking to present to the Ontario Legislature’s Standing Committee on Justice Policy concerning the Bill on behalf of Ontario’s consumers.