Access To Justice In 'Manageability' Of Individual Issues: Appeal Dismissed In Fantl v Transamerica Life Canada

In the recent decision of Fantl v Transamerica Life Canada ("Fantl")1, the Ontario Court of Appeal unanimously dismissed the appeal of the Divisional Court's decision and confirmed the certification of class claims in negligent misrepresentation, noting that it was time for class actions to "deliver on their promise of access to justice"2 when it comes to individual issues.

Background

The matter involved a class action lawsuit against Transamerica Life Canada advancing a claim for negligent misrepresentation on behalf of investors in the defendant's fund. The alleged misrepresentations arose from "best efforts" statements contained in information folders provided to class members pursuant to the Ontario Insurance Act. The claim concerned 53 different insurance contracts - five of which contained an express statement as to "best efforts" and 48 of which did not.

Certification Decision

The certification judge, while certifying the action for breach of contract based on the five contracts with express "best efforts" statements, declined to certify the negligent misrepresentation claim based on the information in the folders which accompanied the remaining contracts lacking express statements. He found that two, or at best three, of the five elements of negligent misrepresentation could be common issues. As a result, the issues of reliance and damages would have to be dealt with in extensive individual trials, clearly indicating that a class action proceeding was not the preferable procedure for the claims in negligent misrepresentation.

Divisional Court Decision

The Divisional Court reversed the certification judge's decision, noting that the judge did not have the benefit of the reasoning in AIC Limited v Fischer3, in which the Supreme Court of Canada made extensive comments on the application and analysis of access to justice considerations that should be considered at the certification stage. Applying the framework from Fischer, the Divisional Court determined that a class proceeding would function to eliminate the economic bar to access to justice in this instance, especially given that a standalone claim was not financially viable, therefore leaving no reasonable alternative with which to pursue the claim. The fact that a consistent representation in a statutorily required document was the basis of the misrepresentation claim militated towards a resolution of the issues of reliance and damages given their relatively simplistic nature.

The...