On July 7, 2020, the Ontario government voted to pass the most significant changes to the province's Class Proceedings Act, 1992 in the entire history of the legislation.
For the full picture of what the amended Act will look like, click on this updated version of the Class Proceeding Act, complete with additions in blue and deletions in red.
The changes to the Class Proceedings Act, brought in through the passing of Bill 161 (the Smarter and Stronger Justice Act), will modify a piece of legislation that has remained relatively unchanged since it was first brought into law over 27 years ago. The amendments are significant both in terms of their substance and their scope. The amendments modify the majority of the existing provisions in the Act and will add nearly a dozen new provisions. The changes also introduce a variety of new concepts to the Act and will modify the very heart of the Act itself; adding additional requirements to the class action certification test and arguably restricting access to justice in a broad range of important cases.
As of this writing, Bill 161 has yet to receive Royal Assent.
Before the amendments come into force, here are the key details you need to know.
A laundry list of changes
Bill 161 contains a schedule of 36 amendments to the Class Proceedings Act (of which 10 are multi-part amendments), which will modify an Act that currently has only had 37 sections.
The new amendments change over half of the provisions of the Act and will add at least ten new provisions, which consider several concepts previously unaddressed by the legislation including carriage motions, subrogated claims, and multi-jurisdictional class proceedings.
In total, the amendments address a dozen notable topics. A comprehensive list of those topics (and the manner in which the amendments address them) is as follows:
- Registration of
- requiring parties to register proceedings commenced under the Act
- Early resolution of
- encouraging early motions to strike and to determine dispositive legal issues, and requiring that those motions be heard before certification by default
- imposing mandatory "superiority" and "predominance" tests at certification
- Multi-jurisdictional class
- forcing the court, on certification, to take into account existing relevant multi-jurisdictional class proceedings commenced in Canada and whether a proposed multi-jurisdictional class proceeding is appropriately commenced in Ontario
- Carriage motions
- requiring carriage motions to be made within 60 days of filing, which are not subject to appeal and for which counsel for the plaintiffs bear the costs
- stipulating that notices ordered under the Act are to be written in plain language and published in both English and French, and that the costs of notice may only be awarded in the event of a settlement or judgment on the common issues.
- mandating that any settlement of proceedings commenced under the Act (including proceedings that aren't certified) must be approved by the court and imposing evidentiary requirements for settlement materials
- adding reporting requirements for claims administrators
- Distribution on
- allowing for the cy-près distribution of an award or settlement amount where it is not practical or possible to compensate class members
- Subrogated claims
- imposing potential obligations relating to subrogated claims, including notice obligations and restrictions surrounding settlements
- Mandatory dismissal for
- mandating dismissal for delay if certain steps have not been completed within a year of commencement of the proceedings
- providing all parties with a direct right of appeal to the Court of Appeal from certification decisions and restricting the ability of an appellant to materially amend materials on an appeal.
- requiring that fee agreements with representative plaintiffs be approved as fair and reasonable based on a number of mandated criteria
- Third-party funding
- significantly limiting the scope of permissible third-party funding agreements
Improving access to justice in many small ways
The large volume of changes to the Class Proceedings Act (with at least one notable exception) arose from a comprehensive list of recommendations put forward by the Law Commission of Ontario, the province's leading law reform agency. The Law Commission published a report in July 2019 following a multi-year review of class actions in the province. The report made more than 40 recommendations to reform the Act, with the objective of furthering the three goals of class actions adopted by the Supreme Court of Canada: access to justice, judicial economy, and behaviour modification.
The new amendments substantially adopt many of the Law Commission's recommendations including provisions respecting:
- Timing of certification motions and administrative dismissal;
- Multi-jurisdictional class actions;
- Settlement approvals and distributions;
- Fee approval;
- Third party funding; and,
The Law Commission has stated that these provisions will "improve access to justice, improve judicial efficiency, reduce delay and costs for all class action stakeholders, and ensure a high degree of accountability and transparency for class action proceedings in Ontario."
Reducing access to justice in one major way
Despite the many changes that build off the review by the Law Commission, the biggest substantive change to the Act was not based on any recommendation. The most notable amendment to the Class Proceedings Act is a modification of the certification test – the test by which the courts determine which cases will become class actions in Ontario – which adds the requirements of "predominance" and "superiority" to the test.
The added elements set a new threshold for certification. For a court to determine that a class action is the preferable procedure for the resolution of the "common issues" shared by the class members, the class action must now be "superior to all reasonably available means of determining the entitlement of the class members to relief or addressing the impugned conduct of the defendant" and the common issues must "predominate over any questions affecting only individual class members."
By adding these mandatory requirements, the amended Act may restrict the public's ability to pursue class actions regarding several important subjects, including medical liability and systemic negligence cases, which can involve some individual issues. The likely ramifications are that corporations or government entities will more easily avoid litigation on those subjects and individuals who are harmed will have a harder time pursuing access to justice.
The Law Commission has stated that the "superiority" and "predominance" requirements will "fundamentally restructure class action law and policy in Ontario by shifting the Class Proceedings Act's longstanding certification test strongly in favour of defendants." Even though Bill 161 adopted several of the Law Commission's recommendations, the Law Commission declined to support the Bill due to the changes to the certification test.
The Law Commission found that the change to the certification test would have prevented some of Canada's most high profile class actions such as Indian Residential Schools, the Walkerton environmental tragedy, and the hepatitis C tainted blood supplies case, and creates a situation where Ontarians may have fewer legal rights and less access to justice than other Canadians. The Law Commission did not believe that the problems with the "superiority" and "predominance" requirements were "cured or balanced by the many positive elements of the legislation."
It remains to be seen whether the courts will interpret the newly modified certification test restrictively. The Supreme Court of Canada has repeatedly stated that the Class Proceedings Act "should be construed generously to give full effect to its benefits." In British Columbia, the class action legislation requires the court to consider "predominance" and factors similar to "superiority" on certification, and that legislation has been interpreted favourably for plaintiffs.
Regarding of how Ontario courts will interpret the newly amended Class Proceedings Act, Siskinds will remain at the forefront of class action practice in Ontario, as it has been since Siskinds certified the first contested class action in the province in 1993.
Originally published by Siskinds, July 2020
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.