General counsel and the class action bar should take note that a
new provision in Québec's new Code of Civil
Procedure (NCCP), which comes into force on January 1, 2016,
may create an obstacle for streamlining—and ultimately
resolving—multi-jurisdictional class actions in Canada.
The new provision, article 577 of the NCCP, will require
Québec courts to protect the rights and interests of
Québec residents in multi-jurisdictional class actions when
stays of proceedings are requested.
It is common for plaintiff and defence counsel to seek a stay of
proceedings in Québec to allow for a single national class
action to proceed in another province (e.g., Ontario) when similar
class actions have been commenced in multiple jurisdictions across
Canada. Counsel seeking to litigate a national class action in only
one jurisdiction are required to obtain stays because, unlike the
United States' federal courts, there is no multidistrict
litigation procedure for consolidation in Canada. Article 577 may
create a hurdle for parties litigating a national class action, as
it could result in a multiplicity of class proceedings across the
country on the same issues.
Until now, Québec courts have shown some flexibility in
granting stays. But the legislative intent behind article 577
indicates that it will likely raise the bar for parties, requiring
them to show that the rights and interests of Québec
residents are sufficiently protected in the province where a single
national class action is sought, and this may mean showing that
those rights are equivalent to those in Québec.
Under the new provision, if Québec class members are
already members of a national class action in another province or
territory, Québec courts must consider the rights and
interests of Québec residents before either (i) declining to
certify, (ii) staying certification or (iii) staying a similar
class action that has also been commenced in Québec.
Article 577 provides:
The court cannot refuse to authorize
a class action on the sole grounds that the class members are part
of a multi-jurisdictional class action already under way outside
If asked to decline jurisdiction, to
stay an application for authorization to institute a class action
or to stay a class action, the court is required to have regard for
the protection of the rights and interests of Québec
If a multi-jurisdictional class
action has been instituted outside Québec, the court, in
order to protect the rights and interests of class members resident
in Québec, may disallow the discontinuance of an application
for authorization, or authorize another plaintiff or representative
plaintiff to institute a class action involving the same subject
matter and the same class if it is convinced that the class
members' interests would thus be better served.
According to Québec's Minister of Justice, article
577 is "new law" intended to protect the rights and
interests of Québec class members. The protection of these
rights and interests is now a factor Québec courts must
consider when granting a stay, in addition to the pre-existing
conflicts of laws rules. The Minister's comments further
explain that the new provision is of interest to Québec
residents because of the differences between Québec's
civilian legal system and the laws of the common law provinces.
Québec's robust consumer protection laws are one example
of such a difference. This may mean that courts will have to
consider such differences when granting stays.
In the past, Québec courts have granted stays on the
grounds that a similar action is pending, that it has advanced
further in another province, and that granting a stay in
Québec would allow for the "efficient management"
of the class action. For example, recently, the Québec
Superior Court in Arsenault c. Bard Canada inc., 2015 QCCS
2530 granted a stay for a proposed medical device class action
that had been commenced in Ontario and Québec, allowing for
a single proposed national class action on the same issues to
proceed in an Ontario court.
The legislative intent behind article 577 suggests that the new
provision will likely raise the bar for parties seeking a stay of
proceedings in Québec class actions (See Leroux c. Compagnie d'assurance-vie
Manufacturers, 2014 QCCS 4104). Parties intending to
proceed with a single national class action by staying simultaneous
Québec proceedings will have to show to Québec courts
that the proceeding outside Québec protects the rights and
interests of Québec residents. This may mean showing that
the rights and interests protected in class action proceedings
outside Québec are equivalent to those available under
Québec law. If parties fail to satisfy the court's
concerns over Québec class members, then they may be faced
with having to continue litigation in Québec as well as
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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