Canada Post Corporation v. Michel Lépine,
2009 SCC 16
In this recent decision, the Supreme Court of Canada addressed
the question of multiple overlapping class proceedings. In so doing
it adopted the decidedly cautious view that the issue was one for
the legislators, not the courts.
The action arose as a result of a lifetime Internet service that
was offered by the defendant, Canada Post Corporation. Canada Post
subsequently cancelled the service and, as a result, numerous class
proceedings were initiated by purchasers. An overlap between two
such proceedings - one in Ontario and one in Quebec - gave rise to
this case.
In Ontario, a class was certified for the purpose of approving a
settlement reached between Canada Post and the plaintiffs. The
Ontario class definition included Quebec residents, despite the
fact that the Ontario Court was aware that another proceeding based
on the same cause of action had already been commenced in the
Quebec Superior Court. In fact, the plaintiffs' counsel in the
Quebec proceedings wrote to the Ontario Court requesting that it
decline jurisdiction with respect to the Quebec residents.
In light of the certification proceedings taking place in Ontario,
Canada Post attempted to have the Quebec action stayed. The Quebec
Court declined to stay the proceedings and, the day after the
Ontario settlement was approved, the institution of a class action
on behalf of Quebec residents was authorized by the Quebec Superior
Court.
In a final attempt to avoid having to defend multiple proceedings,
Canada Post tried to have the Ontario judgment approving the
settlement recognized and enforced in Quebec. Under the Civil
Code of Québec, a Quebec court must recognize and
enforce a foreign or external judgment unless certain specified
exceptions apply. These exceptions include, among others, cases
where: (1) the decision-maker did not have jurisdiction to decide
the matter; (2) the decision contravenes the fundamental principles
of procedure; or (3) the dispute was between the same parties over
the same issue as a dispute that is already pending in a Quebec
court. Based on all three of these exceptions, both the Quebec
Superior Court and the Court of Appeal refused to enforce the
settlement. The Supreme Court of Canada upheld these decisions and
refused to enforce the Ontario settlement in Quebec; however, the
Supreme Court differed slightly in its reasons.
Jurisdiction of the Ontario Superior Court
First, the Supreme Court disagreed with the Quebec Courts on the
issue of whether the Ontario Court had jurisdiction to approve a
settlement that included residents of Quebec. According to the
Supreme Court, the Ontario Superior Court had jurisdiction to
decide the issue and that the manner in which that jurisdiction was
exercised should not have been questioned by the Quebec Courts.
This was a positive, although somewhat silent affirmation of
national classes.
Sufficiency of Notices to Quebec Residents
The Supreme Court's decisions to uphold the decision of the
Quebec Courts and refuse to recognize and enforce the Ontario
settlement in Quebec largely turned on the inadequacy of the
notices issued pursuant to that judgment.
The problem with the notices was that they did not adequately
explain to Quebec class members what the effect the Ontario
judgment would have on their rights in respect of the action
commenced in Quebec. This inadequacy, according to the Supreme
Court, amounted to a contravention of the "fundamental
principles of procedure". Thus the Ontario judgment could not
be enforced by the Quebec Courts.
Pending Proceedings in the Quebec Courts
The conclusion reached by the Supreme Court regarding the
inadequacy of the notices made it unnecessary to consider whether
the Quebec Courts could decline to enforce the Ontario judgment
because an action was already pending in Quebec. Nevertheless, the
Court went on to discuss the issue. The Supreme Court found that
the Quebec Superior Court was seized of the dispute before the
Ontario Superior Court was, and thus had priority. Accordingly, the
Supreme Court agreed with the Quebec Courts' conclusion that
they were precluded, pursuant to the third of the above-noted
exceptions in the Civil Code of Québec, from
recognizing and enforcing the judgment of the Ontario Superior
Court.
National Parallel Proceedings
The Supreme Court commented briefly on the problem of having
multiple national class actions within Canada against the same
defendants in respect of the same issues. Specifically, the Court
emphasized the potential of such actions to cause friction between
equal courts in different jurisdictions. While acknowledging that
"[m]ore effective methods for managing jurisdictional disputes
should be established in the spirit of mutual comity that is
required between the courts of different provinces in the Canadian
legal space", the Supreme Court did not see it as their role
to solve this problem. Rather, the Supreme Court concluded that
this is an issue for provincial legislatures to deal with and that
"the provincial legislatures should pay more attention to the
framework for national class actions and the problems they
present".
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