In a recent Ontario Court of Appeal decision, Strathy CJO
certified a proposed class action including a subclass of
"presumptively time-barred" class members. The decision
is notable for its discussion of the interplay between the test for
certification and limitation periods.
The plaintiff charities began the proceedings in 2008 alleging
that charitable lottery licensing and administration fees collected
by the defendant municipalities amounted to direct taxes contrary
to the Constitution Act, 1867.
The proposed class was originally and arbitrarily defined as
anyone who had paid licensing fees on or after January 1, 1990. The
proposed common issues included questions about discoverability and
concealment and the impact of the Limitations Act, 2002 on
class members' claims. After an initial certification hearing
and appeal to the Divisional Court, at a second certification
hearing the certification judge accepted the proposed definition of
the class and held that the impact of the limitation issue should
be dealt with at a later stage and not at certification.
Strathy CJO, for the Court, agreed the action should be
certified as a class proceeding, but only if modified by creating a
"presumptively time-barred" subclass of class members who
paid fees within the 15-year ultimate limitation period under the
Limitations Act, 2002, but not within the two year basic
limitation period and not preserved by the transition rules in the
statute. There were class-wide common issues of liability and
damages, but this subclass of presumptively time-barred claims also
raised issues of law and fact that were not shared with the timely
In certifying a modified class and subclass, Strathy CJO made
the following points:
Arbitrariness in the class definition
defeats important purposes underlying class proceedings, including
binding persons that ought to be bound by the proceedings,
providing access to justice and achieving judicial economy.
It is strictly the responsibility of
the plaintiffs to properly define a class, not the defendants;
resorting to a "wait and see" approach, instead of
ensuring the class is properly defined at certification, is
Subclasses can play a key role when
there are common issues applicable to all the members of a class,
while other issues are only applicable to some class members.
Where appropriate, considerations
related to the manageability of class proceedings can be
effectively handled through the use of subclasses.
The Court of Appeal's decision demonstrates how, with the
use of subclasses, a class which extends beyond the general
two-year limitation found in the Limitations Act, 2002 may on
occasion nevertheless be certified. However, the Court of
Appeal's decision makes clear that the responsibility of
properly defining the class such that the definition is neither
over-inclusive or under-inclusive will continue to remain with the
claimants in a class action proceeding.
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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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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