In his April 21, 2016 decision in Parsons v. The Canadian Red Cross Society, Justice
Perrell of the Ontario Superior Court refused to allow an
intervenor to participate in a motion concerning the distribution
of an approved settlement. The decision is of importance to class
action practice, as it holds that well-intentioned
"busybodies" are not to interfere in the distribution of
approved class action settlements.
The decision arose from a settlement arising out of the Canadian
tainted blood tragedy. The distribution of the settlement has
resulted in numerous motions (some of which we have
The Intervention Motion
"Steering Committee," an unincorporated group of seven
eminent Canadian physicians, researchers, and scientists, sought to
intervene in an upcoming motion "for the purpose of submitting
that some of the actuarially unallocated funds should be allocated
to the 'National HCV Initiative' of which the Steering
Committee is the organizing group or steering committee." The
National HCV Initiative promotes improving delivering of care to
all Canadians living with HCV, and improving future prevention,
care and treatment of Hepatitis C through research.
Justice Perrell "did not necessarily" agree with the
submission that the court did not have discretion to make an
allocation to the Steering Committee or its National HCV
Initiative. Nor did he decide whether the Steering Committee
satisfied the conventional test under Ontario's Rules of
Civil Procedure about intervention as a third party in a
Instead, he refused the Steering Committee's request to
intervene on narrow grounds:
the Steering Committee was a stranger to both the Settlement
Agreement and to the litigation that spawned the Settlement
the Steering Committee was in conflict with both the Class
Members and the Defendants, who had "no obligation to share
the actuarially unallocated funds with strangers to the contract or
to the litigation that was settled by a negotiated
under the court-approved settlement, requests for an allocation
of excess capital must come from a "Party" to the
settlement, which the Steering Committee was not;
He ultimately concluded:
However commendable sharing any
excess capital with all Canadians who suffer from Hepatitis C may
be, the parties to the litigation, the plaintiffs and the
defendants to the class actions, negotiated a settlement in their
own self-interest and they are under no obligation to be altruistic
in enforcing the bargain they reached. The Steering Committee has
no substantive right to participate in what amounts to the
administration of a contract that has been approved by the court.
Its participation would create an opponent to the parties to the
contract, and the Steering Committee's participation would
delay and potentially disturb the commencement of the
long-scheduled hearing of the allocation motion.
Class action settlements are carefully negotiated contracts
subject to court approval. This decision demonstrates that rights
granted and obligations assumed pursuant to such contracts are
rights of parties to the settlement, and are not to be interfered
with by third parties.
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