Canada: Supreme Court Defines Criteria For Identical Questions Of Fact And Law In Class Action Matters Under Quebec Law

In the case of Vivendi Canada Inc. v. Dell' Aniello (Vivendi), the Supreme Court of Canada (SCC) once again addressed the scope of the criteria for the authorization of class actions, in particular the criterion of identical questions of fact and law set out by article 1003(a) of the Code of Civil Procedure (CCP). This follows another important decision on this matter rendered by the SCC in Infineon Technologies AG v. Option consommateurs in October 2013.

In Vivendi, the validity of a unilateral modification to the conditions of the health insurance scheme of a retirement plan of retired Vivendi employees and their surviving spouses was challenged. The retired employees affected by this modification resided in six Canadian provinces. Therefore, this was a "national" class action for which authorization was sought in Quebec.

The Québec Superior Court had dismissed the application for authorization to institute a class action principally because the "bundling of individual actions" of class members did not lend itself to a collective resolution, and therefore the action did not meet the criteria set out at article 1003(a) of the CCP. The Court of Appeal of Québec reversed this decision and authorized the institution of the proposed class action. The SCC affirmed the decision of the Court of Appeal.

The SCC confirmed that the existence of a single identical, similar or related question of law or fact that applied to the entirety of the class was sufficient to authorize the class action, as long as this question would allow for a non-negligible portion of the litigation to be resolved and allow for the progression of the treatment of the claims of the entirety of the class members. The SCC added that it was not necessary for the common question to lead to a common response for all of the class members. This was a novel point in relation to the existing state of law.

The SCC specified that the criterion of an identical question of fact or law differs from the common issue criteria applied in common law provinces. In effect, the Quebec approach to the criteria of the commonality of issues is less demanding than that of the other Canadian provinces.

The SCC also took advantage of the opportunity to settle the jurisprudential debate with respect to the applicability of the principle of proportionality to class action authorization motions. The SCC stated that when all of the criteria enumerated at article 1003(a) of the CCP are met, the judge hearing the application for authorization must authorize the class action. The judge therefore should not address the question as to whether the class action is an adequate procedural vehicle, unlike the approach in the common law provinces. In this sense, the proportionality principle set out at article 4.2 of the CCP is not an independent criterion. That said, the judge must ensure that the proportionality principle is respected when evaluating each of the criteria applicable for the authorization of a class action. This forms part of the authorization judge's discretionary power to appreciate the case before him.

The Vivendi decision brought some clarity to the doubts that the SCC seemed to raise in Canada Post Corp. v. Lépine with respect to the possibility of exercising a national class action: "national" class actions are possible in Quebec, to the extent that there is not a substantial divergence between the various applicable legal regimes, which would eliminate the collective dimension from the class action. In Vivendi, because of the absence of a designation of applicable law in the employment contract of the employees at issue, each individual case was governed by the law of the province in which the employee resided. Nevertheless, the fact that several legal regimes applied to the merits of the case does not automatically make it impossible to be a class action.

Similarly, according to the SCC, the multiplicity of sub-classes of the proposed class is not in and of itself an inherent obstacle to the authorization of a class action. The SCC must nevertheless ensure that there is no conflict of interest between the various possible class members.

Finally, though the case deals essentially with the criteria of the commonality of questions at issue, the SCC stated in passing that the use of the term "arguable case" in the Infineon decision does not modify the criteria provided for at article 1003(b) of the CCP as interpreted by the prior jurisprudence, and that the petitioner must still show a "serious appearance of right."

In summary, the Vivendi case is in line with the Infineon case, and confirms that the authorization procedure for a class action in Quebec is more flexible than that in other Canadian provinces.

It remains to be seen how this will be reflected in practice. The Quebec jurisprudence has reiterated many times that a class action should not lead to a multitude of "mini trials." However, since the SCC has stated that it is not necessary to obtain common answers to identical, similar or related questions of fact or law, it necessarily follows that multiple solutions will lead to many mini trials. The authorization judge will therefore be required to ensure that the multiple potential answers to the common questions will allow the debate to progress. It is at this stage that the proportionality principle set out at article 4.2 of the CCP will come into play for the benefit of both the class members and the respondents. It will be interesting to follow the evolution of the jurisprudence in Quebec on this issue.

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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