Class actions, by their very nature, mandate the extra
procedural step of a certification motion. As a result, a class
proceeding is generally longer than a standard civil proceeding and
can be significantly more complex. When certification motions and
costs of certification are appealed this leads to even longer and
more expensive steps in the litigation before the discovery stage
is reached. All of these steps can be significant draws on the
parties' resources. As a result, the law surrounding costs,
i.e. who bears the burden of financing the different steps, may be
even more significant. In class actions, rulings on costs awards
must also take into account one of the fundamental goals of the
Class Proceedings Act, 1992, that of access to
In Amyotrophic Lateral Sclerosis Society of Essex v. Windsor
(City)1 the representative plaintiffs appealed a
portion of the certification order, the class definition, arguing
that a limitation period should not have been applied to restrict
the composition of the class. After successfully receiving leave to
appeal and a successful appeal, the Divisional Court remitted the
matter to the case management judge for a rehearing. The successful
representative plaintiffs sought costs of the appeal and the leave
motion. The Divisional Court refused to do so and ordered that
costs of the appeal and of the motion for leave to appeal be
determined as part of the overall costs of the certification
The representative plaintiffs obtained leave to appeal the
Divisional Court's costs order to the Court of Appeal. In 2013 ONCA 254, the Court of Appeal found that
the Divisional Court was plainly wrong in its refusal to award
costs. The Court of Appeal held that the success of the appeal was
not divided as argued by the defendants. The representative
plaintiffs were successful on the limitations issues and the fact
that the matter was returned to the case management judge for a
rehearing as opposed to granting the representative plaintiffs'
an order certifying the action did not detract from that success.
Further, it was only because of the success of the representative
plaintiffs' appeal that the issues raised by the defendants
needed to be addressed.
The general rule is that where an appeal is successful and
results in a rehearing, costs are to be awarded to the appellant
and should not depend on the outcome of the rehearing. Notably,
this general rule is not inflexible and costs remain in the
discretion of the court. However, in this case, the Court of Appeal
held that the Divisional Court had erred by not applying the
general rule. The Court of Appeal held it was important to separate
the appeal from the certification motion. The costs incurred for
the appeal and leave to appeal were stand-alone costs incurred by
litigants who wanted their day in court.
The Court of Appeal also noted that it would not be appropriate
for the appellants, the representative plaintiffs, to carry the
financial burden of their successful appeal by delaying recovery of
costs until the outcome of the certification motion or until final
disposition of the action as this would not promote access to
justice. The Court of Appeal found that the Divisional Court should
have awarded costs and, in the circumstances, chose to fix those
costs on a partial indemnity basis.
1Lerners LLP is solicitor of record for the
plaintiffs in this action.
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