SCC Weighs-In On Consumer Protection Remedies In Quebec Class Actions

On September 19, 2014, the Supreme Court of Canada released a trilogy of decisions examining the standing of representative plaintiffs and the availability of consumer protection legislation in the class action context. Though these decisions are particular to Québec, and its consumer protection legislation, they provide insight into how consumer protection legislation is broadening the scope of available remedies in class actions.

In Bank of Montreal v Marcotte, 2014 SCC 55, Amex Bank of Canada v Adams, 2014 SCC 56, and Marcotte v Federation des caisses du Desjardins du Quebec, 2014 SCC 57, the representative plaintiffs brought class actions on behalf of consumers who incurred conversion charges from banks as a result of making foreign currency purchases on their credit credits. Among other things, the representative plaintiffs: (a) alleged that the conversion charges imposed by the banks violated section 12 of Québec's Consumer Protection Act (QCPA) because the charges were not properly disclosed by the banks; and (b) sought repayment of the conversion charges under section 272 (the remedies section) of the QCPA.

Decisions and Issues

At the Québec Superior Court, the trial judge divided the banks into two groups: the Group "A" Banks (including BMO, NBC Citibank, and TD banks) and the Group "B" Banks (RBC, CIBC, Scotia, and Laurentian banks). The trial judge found that the Group "A" and "B" Banks violated section 12 of the QCPA by failing to mention the conversion charge or to provide details about it to cardholders. Under section 272 of the QCPA, these banks (with the exception of TD bank) were ordered to make collective retribution to cardholders in the amount of the conversion charges. TD Bank was ordered to make individual retribution because it refused or failed to provide the information at trial required to make collective retribution. The trial judge also awarded punitive damages in the amount of $25 per cardholder against each Group "A" Bank.

The Québec Court of Appeal overturned the trial judge's findings against the Group "B" Banks, holding instead that these banks had met the disclosure requirements under the QCPA. However, the Court of Appeal accepted the trial judge's findings with respect to the Group "A" Banks, with the exception of the award of punitive damages, which were overturned against all of the Group "A" Banks except TD.

The Supreme Court of Canada accepted the Court of Appeal's decision with respect to the Group...