Class Actions: Their Day in Court
March 1, 2013
Businesses in Canada are understandably nervous about the proliferation of class actions. No less than 123 class actions were filed across the country last year, up from 106 in 2011 and nearly four times as many as 2006, according to the Canadian Bar Association’s National Class Action Database. Over the past few years, class action suits have spread into new areas of law: securities, environmental, competition and labour, to name but a few. What’s more, uncertainty and ambiguity are always a key challenge for business, and when it comes to class actions, it’s been hard to tell where the complex and shifting legal landscape is heading next.
Few class action trials have actually made it to trial in this country, at least outside of Quebec. In Ontario there have only been 16 merits decisions since the Class Proceedings Act was enacted in 1992. Quebec, the first province in Canada to introduce class action legislation in 1978, has had 62. All told, there have been only 92 class action trials in Canada, with 86 of those reaching a trial decision, according to figures compiled by Jonathon Foreman, a litigator with Harrison Pensa LLP.
That's about to change, says Sylvie Rodrigue, chair of the CBA National Task Force on Class Actions. The conventional practice of reaching for a settlement when plaintiffs obtained a certification order in a class action is about to give way to trials on the merits, she predicts. And in many cases full-scale legal battles on the certification front are going to fade away. A more mature class action environment coupled with the perception that the threshold for certification, particularly in Ontario, has become softer is prompting the defence bar — and clients — to rethink their tactics and deploy their resources to a setting where they feel they have a good chance of defeating claims. Rodrigue, who heads the new Torys office in Montreal, concurs. "When the case is very strong at trial, sometimes it would be more efficient and a lot less costly for the defendant to negotiate the common issues they want to see tried — and just go to trial."
That said, more class action trials may nonetheless lead to tougher certification battles, says Rodrigue. If the Quebec experience is anything to go by, the more judges preside over class action trials, the more they tend to interpret certification criteria stringently.
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