Courts have begun to criticize plaintiff lawyers who file
multiple overlapping class actions across the country. In Ontario,
Perell J. refused to approve an agreement by two BC firms to share
their fee with a Saskatchewan-based firm, Merchant Law Group
("MLG") in Bancroft-Snell v. Visa Canada
Corporation. More than one year after the BC firms had filed
class actions in Ontario and BC alleging conspiracies in relation
to credit card interchange fees, MLG started copycat actions in
Alberta and Saskatchewan. The BC firms agreed to pay a share of
their fee to MLG in return for MLG agreeing to stay its
In a hard-hitting judgment, Perell J. described the fee sharing
agreement as "ransom fee" that was unenforceable and
possibly illegal. MLG's legal services were "useless to
the client"; it "did not make a contribution to the
achievement of the settlement agreement and should not share in the
recovery". He described MLG's late filing of class actions
as "suspect": "What purpose was being served by
another class action other than opportunism to share in the
In Saskatchewan, however, Justice Ball agreed with Perell J.
that the fee sharing agreement ought to have been disclosed to the
court, but refused to look behind class counsel's decision to
share their fee with MLG. He noted that the fee sharing agreement
was an agreement between lawyers, and thus not subject to court
approval under Saskatchewan's Class Actions Act. Any
determination that MLG acted unlawfully should be made in a
proceeding in which MLG is before the court, he added.
Perell J. also questioned the usefulness of starting overlapping
national class actions in five provinces after the BC action was
commenced and then "parking" them. He suggested that the
representative plaintiffs in these other provinces could simply be
added as representative plaintiffs in BC.
Courts in Quebec have also reacted negatively to class action
parking. In Cohen v. LG Chem Ltd.,and Option
Consommateurs v. Panasonic Corporation, the court departed
from the normal "first to file" rule, and awarded
carriage to a rival firm, after finding that the actions started by
the first firm were simply copy-and-paste actions that had then
been one of many started across the country to occupy the field,
and then not pursued with diligence. The Quebec courts do not seem
to have adopted Perell J.'s suggestion that there should be one
national class action in one province, however.
Provinces have also started amending class proceedings
legislation to make it easier to manage multi-jurisdictional class
actions. Both Alberta and Saskatchewan have adopted provisions
enabling the court to certify multi-jurisdictional class actions or
to stay actions in favour of a multi-jurisdictional class action in
These developments suggest that the current practice of filing
multiple class actions across the country may be about to break
down in favour of having one national class run out of one
province. The question is, which province will become the host for
these national class actions. Contrary to Perell J.'s
suggestion, it is not practical to run a national class action out
of BC. This is because BC's Class Proceedings Act
requires class members outside of the province to opt in to the
class action. Ontario, by contrast, allows the court to include out
of province class members unless they opt out, making national
class actions practicable in Ontario.
BC does offer plaintiffs one important advantage however: no
costs can be awarded against (or to) plaintiffs in class actions.
Ontario, by contrast, permits costs awards against plaintiffs.
There is one province that offers both opt-out national class
actions and a no-costs regime: Manitoba.
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