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The Ontario Divisional Court recently granted leave to appeal in
Johnston v. Sheila Morrison Schools,
a certified class action involving allegations of negligence and
breach of fiduciary duty against a school and its headmaster. The
primary issue on appeal is whether students may make claims against
schools on a several basis and thereby avoid exposing their parents
to counterclaims or third-party claims.
The certification order provided for three classes of
plaintiffs: (i) residential students, (ii) day students, and (iii)
family members of residential students. A statement of defence was
filed prior to certification. Following certification, the
defendants sought to amend their defence to add third-party claims
against the parents and guardians of the students, on the basis
that the parents and guardians were allegedly aware of the
school's practices and thus should also be liable for any
damages sustained by the students. The parents (but not the
guardians) are members of the third certified class.
Decision Below
The motions judge allowed the defendants to add
third-party claims, but stayed these claims (which did not raise
common issues) until individual students proceed to individual
issues trials. The motions judge held that the representative
plaintiffs would not be prejudiced, that third-party claims are not
precluded under the Class Proceedings Act, and that the
law permits claims for contribution and indemnity from parents or
guardians.
The Divisional Court granted leave to appeal on two bases:
The student classes have limited their claims to the several
(or proportionate) liability of the defendants alone and are not
seeking to recover any damages attributable to the fault of any
other person. Applying precedent from the Ontario Court of Appeal,
the Divisional Court wrote, in granting leave to appeal, that there
is good reason to doubt the motion judge's decision, which
would allow the defendants to seek contribution and indemnity with
respect to damages (attributable to the parents and guardians) that
are not being claimed.
Rule 29.01 of the Rules of Civil Procedure provides
that a third-party claim may be made "against any person who
is not a party to the action." As the parents are members of
the third certified class, the Divisional Court queried whether
they are a "party" to the action and thus outside the
scope of Rule 29.01, in which case a counterclaim as against them
(under Rule 27) would have been the correct procedure. The
Divisional Court noted that whether a class member becomes a party
to the action for the purposes of Rule 29.01 appears to be a matter
of first instance and was not considered in detail by the motions
judge.
Potential Significance
As recognized by the Divisional Court, this case raises a
significant issue, with access to justice implications, as to
whether students or residents may sue schools or other institutions
on a several basis, so as to prevent the schools or other
institutions from launching a third-party claim or counterclaim
against the students' parents and guardians.
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