Court Of Appeal Summaries (August 22 – August 26, 2016)

Civil Decisions:

Fantl v. Transamerica Life Canada, 2016 ONCA 633

[Strathy C.J.O., Blair and Lauwers JJ.A.]

Counsel:

M.J. Stitt and D. McLeod, for the appellant

D. F. O'Connor and J. A. Dewar, for the respondent

Keywords: Torts, Negligent Misrepresentation, Insurance Act, Class Actions, Class Proceedings Act, Certification, Preferable Procedure, Common Issues, Individual Issues, Access to Justice, AIC Limited v. Fischer, 2013 SCC 69, [2013] 3 S.C.R. 949

Facts:

The proposed class is composed of investors in Transamerica's Can-Am Fund, an investment vehicle offered under insurance contracts sold by Transamerica between October 1992 and March 2001.

The respondent's class action encompasses 53 different insurance contracts. Five of these contained an express statement that the fund would "on a best efforts basis replicate the performance of the S&P 500 Total Return Index." The other 48 contracts did not contain this express statement. However, beginning in 1994, every investor in the Can-Am Fund received an information folder containing a statement that the goal of the fund was to replicate, on a "best efforts" basis, the performance of the S&P 500 Total Return Index.

The information folder was provided pursuant to regulations under the Ontario Insurance Act, which required that investors receive a disclosure document before investing in a segregated fund like the Can-Am Fund. That document, referred to as an "information folder," is required to disclose the fund's investment policy and objectives. Investors are required to acknowledge receipt of the information folder.

The respondent's negligent misrepresentation claim arises from the "best efforts" statement in the information folder. The respondents argue this representation was untrue. The certification judge held that a class action was not the preferable procedure for the negligent misrepresentation claims. The Divisional Court overturned this ruling, noting that the certification judge did not have the benefit of the Supreme Court of Canada's decision in AIC Limited v. Fischer, 2013 SCC 69, [2013] 3 S.C.R. 949.

Issues:

Whether a class action for negligent misrepresentation would be a fair, efficient and manageable proceeding, having regard to the common issues in the context of the action as a whole and the individual issues that would remain after the common issues are resolved?

Holding: Appeal dismissed.

Analysis:

The court found that a class action was the preferable procedure.

In Fischer, Cromwell J. emphasized that the preferability analysis is a comparative one that considers whether the proposed class action will achieve the goals of the Class Proceedings Act, 1992, S.O. 1992, c. 6, as compared to other means of resolving the claim. Fischer requires us to consider (a) the barriers to access to justice; (b) the potential of a class action to address those barriers; and (c) the alternatives to a class action, including the extent to which the alternatives address the relevant barriers and how the two proceedings compare. As Cromwell J. noted, the most common barrier to access to justice is an economic one, which is the case here. The Court distinguished this case from Kinross, where the Ontario Court of Appeal denied certification for a negligent misrepresentation claim.

Mr. Fantl's claim could not reasonably be viewed as economically viable to litigate in the Superior Court. The cost of expert evidence to establish that the representation was untrue or misleading, and that the misrepresentation was made negligently, would be out of all proportion to the amount at issue. That cost would be a significant barrier to access to justice. That barrier would not be addressed by joinder, which is not a practical means of bringing access to justice to a class of thousands. A class proceeding, on the other hand, has the potential to address this economic barrier by distributing the costs over thousands of class members, rather than one or even a few.

The court determined that if the common issues are resolved in favour of the class, a class proceeding can provide a framework for the resolution of the individual issues. While damages might be a more complex individual issue, s. 6.1 of the CPA expressly provides that the need for individual assessments of damages is not, in itself, a bar to certification. It is realistic to expect that having tried the common issues, the trial judge will have a full appreciation of the individual issues and will be well equipped to devise a procedure for the resolution of those issues. Section 25 of the CPA gives the judge authority to craft fair, inexpensive and efficient procedures in order to do so. This is ancillary to the broad discretion conferred on the court under s. 12 to "make any order it considers appropriate respecting the conduct of a class proceeding to ensure its fair and expeditious determination".

Royal Bank of Canada v. Hussain, 2016 ONCA 637

[MacPherson, Simmons and Lauwers JJ.A.]

Counsel:

A. Hussain, in person

A. Jackson, for the Royal Bank of Canada

Keywords: Civil Procedure, Summary Judgment, Pre-Trial Conferences, Rules of Civil Procedure, Rules 1.04, 20, 50.09, 50.10

Facts:

The Bank (the "respondent") issued a statement of claim against the appellant claiming amounts owing on various loan facilities. After obtaining an order setting aside a default judgment, the appellant delivered a...