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
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
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
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