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Thursday, August 12, 2010

BSE Class Action going national

The Ontario Superior Court of Justice is allowing an amendment to the BSE class action that will expand the plaintiff class to include Quebec farmers.  The change will be conditional on a similar action in Quebec being suspended or "stayed" in favour of the Ontario "national" action.  Also, the Court would not allow this amendment without including an opt-out right for Quebec farmers who would fall within the plaintiff class (those alleged to have suffered damages as a result of the Canadian government's actions in connection with the BSE "outbreak" in 2003). 

For at least the past year, the parties have discussed the desirability of proceeding in a single jurisdiction with a result that would be binding on all cattle farmers across Canada. The subject has been canvassed at various case conferences and court attendances in Ontario and Québec. On May 27, 2010, judges in Ontario and Quebec held a joint case management teleconference involving counsel in this action and the ongoing Quebec action. It was agreed that a motion could be brought in Ontario requesting amendment of the class definition to include the Québec class members, conditional on a suspension or stay of the Quebec action.

The Court also commented that the right to opt out is not a mere technicality. It is the foundation for the court’s jurisdiction over class members because it is the mechanism by which those class members become bound by the court’s decision. This was emphasized by Sharpe J.A. in giving the judgment of the Court of Appeal in Currie v. McDonald’s Restaurants of Canada Ltd. 2005 CanLII 3360 (ON C.A.), (2005), 74 O.R. (3d) 321, [2005] O.J. No. 506 (C.A.) at para. 28:
The right to opt out is an important procedural protection afforded to unnamed class action plaintiffs. Taking appropriate steps to opt out and remove themselves from the action allows unnamed class action plaintiffs to preserve legal rights that would otherwise be determined or compromised in the class proceeding. Although she was not referring to inter-jurisdictional issues, in Western Canadian Shopping Centres Inc. v. Dutton, 2001 SCC 46 (CanLII), [2001] 2 S.C.R. 534 at para. 49, McLachlin C.J.C. identified the importance of notice as it relates to the right to opt out: "A judgment is binding on a class member only if the class member is notified of the suit and given an opportunity to exclude himself or herself from the proceeding." The right afforded to plaintiff class members to opt out has been found to provide some protection to out-of-province claimants who would prefer to litigate their claims elsewhere: Webb v. K-Mart Canada Ltd. 1999 CanLII 15076 (ON S.C.), (1999), 45 O.R. (3d) 389 at 404 (S.C.J.). It is obvious, however, that if the right to opt out is to be meaningful, the unnamed plaintiff must know about it and that, in turn, implicates the adequacy of the notice afforded to the unnamed plaintiff.
In this case, the grant of opt-out rights to the newly-added Québec class members supports comity and displays deference to the court of a sister province by respecting the right of residents of that province to opt out of a proceeding in Ontario if they do not wish to be bound by the outcome.

Read the decision at: Sauer v. Canada (Attorney General).