In a recent decision with potentially far-reaching consequences
– Red Seal – the Saskatchewan
Court of Appeal has rejected the so-called
"Ragoonanan" principle applicable to class
actions. The Ragoonanan principle, which derives from an
Ontario case of the same name, requires that
for each defendant named in a putative class action, there must be
at least one representative plaintiff with a cause of action
The decision in Red Seal was released alongside two
other judgments in the same putative class action: Alves and Roussy. The action involved
allegations that the defendant tour companies sold the plaintiffs
vacation packages in Cuba, with knowledge that the Cuban resorts
could not supply basic water amenities. The defendants were alleged
to be liable for failing to take reasonable care in the selection
of the Cuban resorts, and selling the tour packages without
disclosing the water problems.
In the Alves judgment, the Court of Appeal affirmed the
lower Court's dismissal of the certification motion, based
largely on the plaintiffs' failure to satisfy the common issues
and preferable procedure criteria of the SaskatchewanClass Actions Act.
Additionally, the Court of Appeal in Roussy prohibited a
new representative plaintiff from being added to the proceeding
where he had already settled with the defendant, Red Seal, from
whom he purchased his vacation package.
Owing to the judgment in Roussy, there was no
representative plaintiff with a cause of action against Red Seal.
Nevertheless, in the Red Seal judgment, the Court of
Appeal rejected a motion by Red Seal to strike the claim against it
on this ground pursuant to the Ragoonanan principle.
Richards J.A., writing for a unanimous Court, noted that the
Ragoonanan principle had been accepted by both the Ontario and Quebec Courts of Appeal. However, Richards
J.A. preferred the reasoning of the British Columbia Court of
Appeal in MacKinnon, where a five-member panel rejected
According to Richards J.A., even prior to certification, a
putative class action is not an "ordinary" proceeding
that is subject to the rules of court in the same way as other
types of litigation. Instead, it has a "special
character", and is coloured by the Class Actions Act
from the outset. Based on a contextual analysis of the Class
ActionsAct, Richards J.A. concluded that the statute
does not foreclose, but instead contemplates, the certification of
proceedings in which there are some defendants against whom no
representative plaintiff has a cause of action. As he observed:
"...to the extent the
Act pushes the boundaries of traditional standing
concepts, it does so deliberately and at the instance of the
Legislature". (para. 45)
Richards J.A. also dismissed concerns that the rejection of the
Ragoonanan principle could lead to a flurry of
"phantom" class actions, in which plaintiffs attempt to
extract settlements from defendants through lawsuits brought on
behalf of class members who do not truly exist. He found that such
phantom actions – to the extent they are even a real
concern – would likely fail the certification motion
based on the plaintiff's inability to show "some basis in
fact" for the existence of the class. Additionally, Richards
J.A. left open the possibility of bringing a motion to strike a
phantom action under the rules of court.
The Red Seal decision is an important development in
Canadian class actions law. It further accentuates the split
between appellate courts concerning the validity of the
Ragoonanan principle. Now that four provincial courts of
appeal are evenly divided on the issue, it is likely that the
Supreme Court of Canada will look to resolve the issue in the near
Red Seal may also be relevant in adding to the growing
attraction of Saskatchewan as a forum for class actions.
Saskatchewan is already a "no costs" jurisdiction in
which non-resident class members must "opt out", rather
than "opt in", to certified proceedings. With the
rejection of the Ragoonanan principle, plaintiffs'
counsel may increasingly look to Saskatchewan as their jurisdiction
It's not often that our little blog intersects with such titanic struggles as the U.S. presidential race – and by using the term "titanic" I certainly don't mean to suggest that anything disastrous is in the future.
J.J. v. C.C., is an interesting case in which the court held that an automotive garage owes a duty to minor children to secure the vehicles on the premises by locking the cars and safely storing the car keys...
In Irwin v. Alberta Veterinary Medical Association, 2015 ABCA 396, the Alberta Court of Appeal found that the "ABVMA" failed to afford procedural fairness to a veterinarian undergoing an incapacity assessment.
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