Canada: Judicial Comity In National Class Action Settlement Approval – Judicial Efficiency Is No Laughing Matter

In a decision of the Alberta Court of Queen's Bench issued March 18, 2019 (Macaronies Hair Club and Laser Centre Inc. v. BofA Canada Bank, 2019 ABQB 181)1, supplementing an earlier decision2 (the "Macaronies Decision"), Associate Chief Justice J.D. Rooke weighed in on the principles of judicial comity and its role in cost-effective and efficient management of court resources in multijurisdictional class actions. In particular, the Court found that, where there are identical class actions in multiple Canadian provinces, judicial comity demands a balance between courts in each jurisdiction  making their own determinations and giving "considerable weight" to the decisions made in other Canadian jurisdictions.

Background

The Macaronies case addresses interchange fees paid by merchants in connection with the acceptance of Visa and Mastercard payments. One class proceeding proceeded through the Supreme Court of British Columbia while the substantially similar cases in other jurisdictions, including Alberta, stayed their actions.

On July 13, 2018, the Supreme Court of British Columbia, in the decision of Coburn and Watson's Metropolitan Home v. BMO Financial Group, 2018 BCSC 1183 (the "British Columbia Decision"), approved an application by the plaintiffs to certify the case for settlement purposes in connection with proposed settlements (the "Settlements") reached with certain defendants.  Applications to approve the Settlements were also filed in Ontario, Quebec, Saskatchewan and Alberta. The Macaronies Decision stems from the Alberta application by the plaintiffs to approve the Settlements, which came before Associate Chief Justice Rooke on July 5, and August 23, 2018.

The Macaronies Decision

In his decision, Associate Chief Justice Rooke spoke at length about judicial comity, which is "the general principle that encourages the recognition in one country of the judicial act of another". He affirmed that on an application for certification for settlement purposes, judicial comity does not preclude each judge from considering the issues afresh and determining whether the settlement is fair and reasonable and in the best interest of the class; in fact, quite the opposite. The settlements before the court in multijurisdictional class actions, like the one at issue here, require approval by courts in each jurisdiction in which an action is filed. Therefore, as with any other case, each court has an independent obligation to review the settlement, consider the issues, and make a fair and reasoned decision.

Associate Chief Justice Rooke held that applying judicial comity to recognize the decisions of other jurisdictions could be an important tool in improving access to justice, consistently interpreting rights, limiting the inefficiencies of multiple court proceedings, and making the most of scarce judicial resources. In particular, Associate Chief Justice Rooke noted that judicial comity and the goal of certainty in litigation outcomes call for "considerable weight to [be placed on] the decisions in other Canadian jurisdictions in identical class actions claims". In the Court's view, that weight is increased for decisions of a trial judge, who, in this case, had lived with the file for over 7 years.

Associate Chief Justice Rooke applied these same principles of comity in approving class counsel fees. The Supreme Court of British Columbia had already approved the fees and disbursements for British Columbia counsel, who appeared on behalf of the class across all jurisdictions.  The Court stated that each jurisdiction should rule on the appropriateness of fees, and then acceded to the British Columbia Decision.

Finally, Associate Chief Justice Rooke criticized counsel's failure to use the 2018 Canadian Bar Association Protocol (which we previously discussed here), which recommends "best practices" for the management of multijurisdictional class action settlement approval hearings. The Court encouraged counsel to set a procedural precedent by following the Protocol at the Court of Appeal level in this matter and leading the way on this critical step toward judicial efficiency.

At a time when court resources are stretched thin and access to justice is on everyone's mind, the Alberta Court of Queen's Bench has provided a timely discussion of judicial comity and its role in judicial efficiency in multijurisdictional class actions. The Macaronies Decision sets out that in dealing with approvals of national class action settlements the court must, in the name of judicial comity, balance:

  1. the need for each judge to consider the settlement anew and determine if such a settlement is fair, reasonable, and in the best interest of the class, and
  2. judicial efficiency and the requirement for mutual recognition among Canadian courts of other Canadian decisions on the same class action claims.

This balance is not easy, but necessary.

Footnote

1 McCarthy Tétrault LLP is counsel in this case.

2Macaronies Hair Club and Laser Center Inc. v. BofA Canada Bank, 2018 ABQB 633

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