Canada: National Class Action Settlements – Enforceable if Done Properly

Last Updated: November 11 2013
Article by Max Muñoz and Scott Kugler

In an important decision regarding multi-jurisdictional class actions, the Manitoba Court of Appeal (the "Court") in Meeking v. The Cash Store Inc. et al,.1 confirmed a new presumptive connecting factor for jurisdiction based on the existence of a "common issue" between resident and non-resident plaintiffs. The Court also refused to enforce part of a court-approved settlement in a previous action against the same defendants on the basis that the notice to class members was inadequate.  In so doing, the Court upheld the enforceability of multi-jurisdictional class actions, but served notice to the profession that such actions will only be enforced if the notices to class members are comprehensive and fair. 

History of the Case

Meeking was a proposed class action that was commenced in Manitoba by a resident of Manitoba against The Cash Store and Instaloans in respect of allegedly illegal interest rates on short term loans. The claims asserted in Meeking had previously been the subject of a class action in Ontario that was certified and settled. 

The certification order in the Ontario action defined the class as including "any person in Canada, resident outside the Provinces of British Columbia and Alberta, who borrowed money as a 'payday loan' from a Cash Store location". The judgment in the Ontario action was slightly different, applying also to payday loans from Instaloans.

Notice of the Ontario settlement was provided to all known class members by mail, by posting the notice in each of the Cash Store's locations in Canada (except locations in B.C. and Alberta), by referring to the notice in various press releases, by posting the notice on class counsel's website, by posting the notice on the Cash Store's website, and by class counsel providing a copy of it to any person who requested it. The notice set out the deadlines for class members to opt-out of the class action, but Mr. Meeking did not opt-out.

When the Meeking action was commenced in Manitoba, the defendants brought a motion to enforce the court-approved settlement from Ontario. The plaintiff took the position that the settlement was not binding on persons in Manitoba because the notice was inadequate. He claimed that he was not aware of the settlement as he had not seen the posters in The Cash Store and had not read the mail that was sent to him by the defendants. He also argued that the Ontario court did not have jurisdiction with respect to transactions involving residents of Manitoba.

The Decision of the Motion Judge

The motion judge relied on the Supreme Court of Canada's decision in Canada Post Corp. v. Lépine2 and held that the prerequisites for enforcement of the Ontario settlement were: a) that the Ontario court properly assumed jurisdiction; b) that the principles of order and fairness were met insofar as Manitoba class members were concerned; and, c) that there was no statutory or common-law rule precluding enforcement.

The motion judge held that the Ontario court had properly assumed jurisdiction because the defendants carried on business in Ontario.  However, the motion judge refused to enforce the Ontario settlement as it related to loans made by Instaloans, as well as signature loans and title loans made by The Cash Store, because the notice with respect to those aspects of the settlement was inadequate.  According to the motion judge, the key deficiencies in the notice were that: a) the heading of the notice did not refer to Instaloans specifically; and b) "signature loans" and "title loans" were not specifically referred to in the notice. Consequently, the motion judge held that the Ontario settlement should only be recognized and enforced with respect to payday loans from The Cash Store.

The defendants and the plaintiffs both appealed.

Manitoba Court of Appeal

(a)        Jurisdiction – New Presumptive Connecting Factor

The Court first considered whether the Ontario court had properly assumed jurisdiction.  

The Court held that the Ontario court properly assumed jurisdiction over the Ontario defendants on the basis that the defendants carried on business in Ontario, which is one of the presumptive connecting factors for assuming jurisdiction set out by the Supreme Court of Canada in Club Resorts Ltd. v. Van Breda.3 However, the Court ruled that in this case, more was required for the Ontario court to assume jurisdiction over non-residents.

With respect to non-residents, the Court recognized a new presumptive connecting factor under which the court could assume jurisdiction over non-resident plaintiffs: the commonality of issues between the claims of residents and non-residents of the jurisdiction. The Court held that "where the Court has jurisdiction over both the defendant and the representative plaintiff in a class action proceeding, common issues between the claim of the representative plaintiff and that of non-resident plaintiffs is a presumptive connecting factor, sufficient to give the court jurisdiction over non-resident plaintiffs".

(b)       Notices to Class Members Must be Comprehensive and Fair

The Court upheld the motion judge's ruling that certain portions of the Ontario judgment were unenforceable in Manitoba because the notice was inadequate. The problems with the notice were: a) Instaloans was not included in the notice heading and therefore an Instaloans customer would have no need to read the contents of the notice where a reference to Instaloans might be made; and b) the notice did not refer to title loans or signature loans and therefore it would be unfair for the settlement to bind customers who obtained these types of loans.


This decision is important for a number of reasons. First, it recognizes the existence of a common issue as a presumptive connecting factor for the assumption of jurisdiction by the court over non-residents. Second, it reinforces the importance of notices to class members and provides guidance with respect to the steps that must be taken to ensure that multi-jurisdictional class action settlements will be enforced outside the province in which they were approved. Lastly, it further confirms that national class actions commenced in Ontario will be recognized in the proper circumstances in other provinces. This should come as welcome news to defendants who do not wish to litigate in multiple provinces, as well as those seeking finality in their action.


1 2013 MBCA 81 [Meeking]

2 2009 SCC 16.

3 2012 SCC 17 [Van Breda].

4 Meeking at para 97

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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