The Class Proceedings Act (Ontario) came into effect on January 1, 1993, and has remained virtually unchanged for more than 25 years. Bill 161 now proposes amendments to the Act which, if enacted, will significantly alter the class action landscape.
Key Proposed Changes
Permitting meritless cases to be shut down earlier. Bill 161 proposes a new section that would require the court to hear motions that may dispose of all or part of the proceeding, or narrow the issues to be determined or evidence to be adduced, before the certification motion or simultaneously with the certification motion. If passed, this section would allow defendants to shut down weak cases at an early stage and potentially avoid expensive certification motions.
Commentary: The Legislature and the courts appear to be taking different approaches towards the shared goal of increasing efficiencies in the court system. The Legislature's approach of allowing defendants to move to narrow or dismiss cases at an early stage is diametrically opposed to the courts' general preference of forcing parties to certification first.
Requiring that common issues predominate over individual issues. At present, the Act simply requires that a class proceeding be the preferable procedure for the resolution of the common issues. Bill 161 proposes a new section that would require that: (i) the proposed class proceeding be a superior means of determining the rights or entitlement of the class members, as compared with, inter alia, any quasi-judicial or administrative proceedings; and, (ii) that questions of fact or law common to the class members predominate over the individual issues.
Commentary: The introduction of a predominance requirement brings Ontario into line with the United States regime where certification is typically a higher hurdle for plaintiffs to overcome.
Imposing a procedure for dismissing dormant actions. Bill 161 proposes a new section that would require the court to dismiss a proposed class action for delay if, within one year from filing, the plaintiff has not filed a final and complete motion record for certification, the parties have not agreed upon a timetable, the court has not ordered that the action not be dismissed or imposed a timetable, or any other steps required by the regulations have not taken place.
Commentary: Dormant actions are a nuisance to the courts and to parties named as defendants in them. This new section should avoid the problem of longstanding dormant actions.
Addressing (Overlapping) Multi-Jurisdictional Class Proceedings. Bill 161 proposes a new section that would require the court on the certification motion to consider whether there is another class action pending in another province involving the same subject matter and, if so, to determine whether it would be preferable for some or all of the claims in the Ontario action to be resolved in another proceeding. Importantly, Bill 161 also creates the right for a party to bring a motion prior to certification for the court to make a determination about whether to stay an action (or grant other relief) where there is an overlapping class action in another province.
Commentary: This legislative amendment would formalize the consideration of claims in other provinces, similar to how the Legislatures in Alberta, British Columbia and Saskatchewan have done. The ability to bring a motion for determination prior to certification is an important addition to the parties' toolbox allowing the elephant in the room to be dealt with before significant costs are incurred on a certification motion.
Additional Proposed Changes
Equalizing Appeal Rights. Bill 161 proposes to change the appeal rights for defendants from certification motions allowing them a direct right of appeal to the Court of Appeal. Plaintiffs already have a direct right of appeal to the Court of Appeal.
Early Determination of Carriage. Bill 161 proposes to have carriage motions between competing class actions filed within 60 days after the first proceeding was commenced. There will be no appeal from carriage decisions. There will be no right to commence an overlapping class action more than 60 days after the first proceeding was commenced. The new proposed section also formalizes the considerations to be applied on carriage motions and eliminates all rights of appeal in respect of carriage decisions.
Notice Costs on Certification. Bill 161 proposes to clarify that plaintiffs must pay for notice of certification initially, though they may seek to recover those costs from defendants if the plaintiffs are ultimately successful in the class proceeding.
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