Canada: Plaintiffs Successful In Class Action Against College For Misleading Advertising

Last Updated: October 7 2013
Article by Matthew Marinett

Most Read Contributor in Canada, October 2018

On November 16, 2012, the Ontario Superior Court of Justice decided in favour of the plaintiffs in a class action against George Brown College (GBC) for misleading advertising (Ramdath et al v The George Brown College of Applied Arts and Technology, 2012 ONSC 6173). The Court held that GBC had made misleading representations in their course calendars to the effect that certain industry certifications could be received while completing an international business program. The decision was recently affirmed by the Ontario Court of Appeal. While damages have not yet been assessed, the case represents the possibility of class actions in cases of misleading advertising.

The impugned representations appeared in the course calendars for the school years 2007-2008 and 2008-2009, and stated that the International Business Management program "provides students with the opportunity to complete three industry designations/certifications." However, GBC did not have any authority to offer the certifications, nor did they have any agreements in place to allow their students to obtain them. The GBC course did not count as credit towards the certification requirements. A number of students, including a large number of international students, were attracted to the program solely in order to receive these industry designations, and stated they would not have enrolled otherwise. After graduating, when it became clear to the students that the certifications would not be offered, a complaint was brought to GBC by the students. In response, GBC modified the wording in the course calendar, but denied that the original text had been misleading.

The students formed a class and brought an action for negligent misrepresentation, violation of the Consumer Protection Act (CPA), and breach of contract. At trial, GBC insisted that the course calendar had not been misleading on the basis that the students had received what the advertisement offered, namely a GBC certificate and the opportunity in the future to obtain the industry certifications if the students chose to do so. The Court disagreed, finding that the wording clearly implied that the certifications, or at least credit towards them, could be obtained during the course.

The Court also dismissed the argument that if the students had diligently researched the industry certifications, they would have realized that GBC could not offer the certifications nor credit towards them. The possibility that such diligent research may have dispelled the clear implication that taking the International Business Management program could lead directly to obtaining the industry certifications was not an adequate defence. Indeed, the evidence revealed that a number of professors told the plaintiff students that completion of certain classes in the program would result in receiving the industry certifications.

The Court had no difficulty in finding that GBC owed a duty of care to its students and that it knew or should have known that the representations were false, thereby constituting a negligent misrepresentation. On the issue of a violation of the CPA, the Court found that the students were "consumers" for the purposes of the Act, and did not fall under the exception for individuals "acting for a business purpose," even if the courses were taken to advance career opportunities. The CPA prohibits "unfair practices," which include "false, misleading or deceptive representations." The Court found a clear breach of this provision. The Court only briefly addressed breach of contract, finding that the terms of the contract between GBC and the students had not strictly been breached.

The Court concluded that monetary damages were the appropriate remedy, but that these would be assessed in the next phase of litigation.

The Ontario Court of Appeal provided only brief reasons in affirming the decision of the Superior Court, but a few holdings stand out from the decision. Firstly, the Court of Appeal held that course calendars are created with the intention that students will rely upon them to determine which academic programs to pursue, and that therefore a duty of care was owed by GBC to the students. Secondly, the Court of Appeal gave deference to the trial judge's holding that the students were "consumers" for the purpose of the CPA, and did not fall within the exception for individuals "acting for a business purpose." Finally, the Court held that the CPA does not require that a consumer show reliance on an unfair practice in order to be entitled to remedies. The appeal was dismissed with costs to the respondents.

This case illustrates the potential dangers of making misleading representations even in limited publications such as course calendars. It also reaffirms the possibility of class actions being brought against advertisers under both common law rights and under provincial consumer protection laws.

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.

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