Britton v Ford Motor Company of Canada
Written by Laura Gill, Cheryl Woodin, Ashley Paterson, Christine Viney and Alicia Yowart
A recent decision of the Alberta Court of Queen's Bench addresses the challenges of considering a pre-certification application to stay a class action when the decision may impact an overlapping proceeding in another jurisdiction. The decision aligns with an emerging shift in class action litigation, which supports national coordination and communication between courts to adjudicate issues in multijurisdictional class actions.
In Britton v Ford Motor Company of Canada, 2021 ABQB 17, the plaintiff commenced a proposed class action in 2019 against Ford Motor Company of Canada alleging that Ford had designed, manufactured or distributed vehicles with defective engines and spark plugs. The same law firm that acted for the plaintiff had started a nearly identical proceeding in Saskatchewan seven years earlier. Ford applied to stay the Alberta action before the plaintiff's certification application, arguing that it was an abuse of process because both the Alberta and Saskatchewan actions were parallel claims, advanced against the same defendants, and involved the same dispute. Ford argued that the Alberta action was duplicative and did not have a legitimate purpose.
In considering Ford's application for a stay, the Court cited the Alberta Court of Appeal's decision in Ravvin v Canada Bread Company, Limited, 2020 ABCA 424, which our Class Action Litigation group recently discussed in Pre-Certification Stays in Multijurisdictional Class Actions: Ravvin v Canada Bread Company, Limited. Ravvin confirmed that stay applications before certification are discretionary and may be appropriate where the case management judge has a sufficient understanding of the nature and particulars of the proposed class proceeding, and where doing so would advance the objective of judicial economy. In Britton, the court reiterated that duplicative national class proceedings that do not serve a legitimate purpose ought to be avoided because they often undermine the three policy objectives of class proceedings (judicial economy, access to justice and behaviour modification), noting that the challenge in managing multijurisdictional class actions was the lack of a national, coordinated approach to class action management.
The Court dismissed Ford's application for a stay on the basis that Ford had not met the onus of establishing an absence of a legitimate purpose for the duplicate claims. The Court noted that Ford had effectively reversed the onus and left it to the plaintiff to justify why the parallel proceeding in Saskatchewan was not abusive. The plaintiff advanced two arguments on this point. First, the plaintiff was dissatisfied with the progress in the Saskatchewan action: "I am advised by [my lawyers] that they are unable to get the court in Saskatchewan to do anything at all regarding the claim…I should not have to wait on a proposed class action in Saskatchewan where the assigned judge…seems unprepared to take the case forward at any time much less in a timely manner." Second, the plaintiff sought to preserve limitation periods for Alberta class members who did not know about the Saskatchewan action. The fact that limitation issues were one consideration among others presumably distinguishes this case from BCE Inc v Gillis, 2015 NSCA 32, where the Nova Scotia Court of Appeal held that it is an abuse of process to file a claim solely to toll the limitation period without an intention to proceed.
The Court here noted that Class Counsel was conducting both actions with cooperation from both plaintiffs, and that Class Counsel had "given mixed signals" as to whether it intended to pursue the Saskatchewan action. While the fact that the Saskatchewan action was not close to certification may justify the Alberta action, there was no assurance that the Saskatchewan action would not ultimately be pursued. Further, if the Saskatchewan action was discontinued, the claims of Alberta residents could be prejudiced by the passage of time under the limitations legislation in a manner that was not present in Saskatchewan. In the circumstances, the Court held that it was more appropriate to consider those issues during the certification application in the context of the objectives set out in the class action legislation.
The Court raised several related issues for the parties to address at the certification hearing, including whether certification of the Alberta action would lead to uncertainty and class fracturing arising from potential limitation issues. In furtherance of the Court's earlier comments on promoting national coordination of class action management, the Court also requested submissions on facilitating a joint discussion with the Saskatchewan court.
Britton suggests that courts may be reluctant to grant stays prior to certification when class members could be potentially prejudiced by applicable limitation periods. The decision also highlights the complex considerations involved in weighing whether a pre-certification stay should be granted in overlapping proceedings in multijurisdictional class actions. Of particular importance to parties and counsel involved in multijurisdictional class actions, the decision reinforces the "evolution of a culture shift" referred to in Ravvin for managing overlapping and duplicative class actions in multiple provinces, and the inclination toward communication between courts managing parallel class actions that was recently encouraged by the Ontario Superior Court of Justice in Winder v Marriott International Inc, 2020 ONSC 7701.
If you would like more information about the issues discussed here or other matters pertaining to Canadian class proceedings, please contact a member of our Class Action Litigation group.