On June 22, 2011, the Divisional Court granted leave, in part,
to appeal from the lower court decision of Justice Strathy in Trillium Motor World Ltd. v. GMC Ltd.
et al. in which a proposed class proceeding
brought by former General Motors car dealership franchisees against
General Motors of Canada (GMC) and Cassels Brock & Blackwell
LLP (Cassels) was certified.
The defendants did not seek leave to appeal all thirteen common
issues that were certified by Justice Strathy, but both GMC and
Cassels took issue with certain common issues.
GMC sought leave to appeal the validity of the following common
Whether GMC owed a duty of fair dealing to the class members,
and breached the duty through its conduct concerning the delivery
of Wind-Down Agreements;
Whether GMC owed a duty to disclose material facts concerning
its restructuring to franchisees at the time of soliciting the
Wind-Down Agreements, and if so whether it failed to disclose
Whether all class members had a statutory right to associate,
and if GMC interfered with the exercise of the right through
certain enumerated actions; and
Whether the waiver and release contained in the Wind-Down
Agreements was void and unenforceable in respect of the class
members' rights under the Arthur Wishart
GMC submitted that the above questions could not be answered
without findings of fact specific to each class member.
Justice Low rejected that submission with respect to (a),
holding that a breach of the statutory duty of fair dealing was
"focused squarely and solely on the conduct of the
defendant" and as such an analysis of whether the alleged
conduct breached the duty "would apply across the board."
The question of whether the impact on the class members constituted
an unfairness, and what (if any) loss resulted, would necessarily
require an individual inquiry. However, it was noted that the
common issue as framed only addressed the defendant's alleged
conduct, and not damages. The common issue was allowed to
In contrast, the suitability for certification of common issue
(b) was held to be open to serious debate. The question of what
material facts were not disclosed was imbedded in the common issue,
and the issue posed an inherently individual materiality inquiry.
The knowledge of class members, and what facts were consequential
to their decision making process, could not be assumed to be
Justice Low also granted leave with respect to the question of
whether the effect on class members of GMC's alleged conduct
with respect to the statutory right of association was a valid
common issue. It was noted that "where questions certified as
common go forward for a common trial, they should be clear of
ambiguities, particularly ambiguities that could either be
construed as begging another question or attracting an inquiry that
is necessarily individual."
Accordingly, leave to appeal was granted with respect to common
issues (2) and (3).
Lastly, with respect to common issue (4), leave to appeal was
denied with respect to the issue of whether the release and waiver
contained in the Wind-Down Agreements was unenforceable.
Cassels sought leave to appeal from the finding of valid common
issues with respect to:
whether it owed, and breached, contractual duties to some or
all of the class members, ii) whether it owed, and breached,
fiduciary duties to some or all of the class members, and
whether it owed, and breached, duties of care to some or all of
the class members.
The plaintiff had alleged the loss of the opportunity to be
represented as a collective and to negotiate an improvement on
GMC's restructuring. Cassels' submission was that the above
issues all required proof of causation, i.e., whether "but
for" Cassels' alleged breaches each class member would
have signed a Wind-Down Agreement. Justice Low noted conflicting
authorities as to whether a requisite component of the
plaintiff's action, whether in tort or contract, for damages
for loss of chance is whether the plaintiff would have acted
differently but for the breach. Due to the unsettled state of the
law, and the individual inquiry of whether each of the class
members would have acted differently in the absence of the alleged
breaches, leave to appeal was granted for the above common
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