Product Liability And Class Actions

• Published date: 13 April 2021
• Subject Matter: Consumer Protection, Litigation, Mediation & Arbitration, Product Liability & Safety, Class Actions, Dodd-Frank, Consumer Protection Act
• Law Firm: Borden Ladner Gervais LLP
• Author: Mr John Hunter and Laura Day

As in recent years, class actions are anticipated to be an ever-present concern for the automotive sector in 2021, increasingly seeking to certify classes national in scope. While the national scope is, in part, a function of the national distribution and sale of automotive products in Canada, legislation in Alberta, Saskatchewan, British Columbia and Ontario specifically require proposed representative plaintiffs to provide notice of proceedings to other representative plaintiffs in other jurisdictions with alleged claims or issues of the same or similar subject matters.

With respect to the defence of class actions, courts are expected to engage in a more critical analysis of plaintiffs' theories on liability and damages, particularly in regards to articulating alleged defects and demonstrating a workable methodology to assess and quantify damages on a class-wide basis in 2021. Part of this shift is due to changes in legislation, such as the amendments to the Class Proceedings Act, 1992 introduced in Ontario in October of 2020, while favourable case law is emerging in Ontario and other provinces to challenge plaintiffs' theories of damages.

The COVID-19 pandemic may also create unique claims from customers, such as claims for repairs outside of warranty due to delays in attending for service alleged to be caused by COVID-19.

Theory of defect

In automotive class actions, the focus of plaintiffs' theory of liability often rests on the alleged existence of a defect somewhere in the vehicle. The specific defect alleged by a plaintiff is lacking in detail, pleading that particular parts or components located inside the vehicle are "defective" without much more. Recent case law clarifies that boilerplate or vague pleading of an alleged defect is not sufficient to meet the requirement that the pleadings disclose a cause of action.

For example, in Kuiper v Cook (Canada) Inc.1, a proposed class sought to certify a class action concerning a medical device. The plaintiffs alleged that the device was defective, but suggested that the defect causing the device to fail arose out of a "matrix of factors" such as the device's shape and type of material. The plaintiffs also alleged that the various factors causing the defect made the device "more dangerous to use than they would have been had other and safer design choices been made."

Ultimately, the Divisional Court held that the plaintiffs' pleading of defect was insufficient and did not meet the criteria necessary to...