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Court certifies class action under tort of intrusion upon seclusion

|Written By Yamri Taddese

More than 600 clients of the Bank of Nova Scotia will pursue a class action against it after a Superior Court judge gave the green light to a lawsuit under the new privacy tort of intrusion upon seclusion.

‘It’s a very generous interpretation of privacy law in Canada, so I think it’s good news for privacy lawyers,’ says Suzanne Chiodo.

On June 6, Justice Robert Smith certified the class action brought under the new tort established in 2012 in Jones v. Tsige, a case in which a bank employee had repeatedly peered into her colleague’s bank account.

In Evans v. The Bank of Nova Scotia, Smith found he couldn’t rule out the possibility the bank is vicariously liable for breach of privacy after one of its employees, Richard Wilson, admitted to stealing clients’ personal information for fraudulent purposes.

“In this case, the bank created the opportunity for Wilson to abuse his power by allowing him to have unsupervised access to customers’ private information without installing any monitoring system,” wrote Smith.

He added that Wilson “was given complete power in relation to the victims’ (customers) confidential information, because of his unsupervised access to their confidential information.”

Smith certified the class action despite the bank’s protest that it had already compensated clients for pecuniary losses they suffered as a result of the breach. “The bank’s admission of responsibility to pay for the pecuniary damages suffered is a different situation from the absence of a claim for compensatory damages,” he wrote.

The ruling is good news for privacy lawyers, says Rochon Genova LLP associate Suzanne Chiodo. Smith’s finding “combines the law that was laid down in Jones v. Tsige with the low bar for certification” in class actions, she says.

“It’s a very generous interpretation of privacy law in Canada, so I think it’s good news for privacy lawyers,” she says.

The fact that there were damages in this case made it easier for the plaintiffs to get their class action certified by claiming negligence, she adds. “I don’t know if negligence just on the simple breach of privacy would always be certified; in fact, I would say it probably wouldn’t be certified,” she says.

“For a cause of action in negligence, you have to show some damages, so a breach of privacy without actual proof of harm is going to be difficult.”

Class action lawyer Daniel Bach of Siskinds LLP says Smith’s decision affirms the low bar for certifying class actions despite the defendant’s argument in Evans that a class proceeding isn’t the right forum to address the dispute.

“The bottom line is that class proceedings law was created specifically for the purpose of allowing lots of people with similar claims to come together and litigate, and that’s exactly what this case is about,” he says.

“There are a lot of arguments advanced by the bank here, but I don’t think the fact that this case is certified should surprise anybody.”

The bank had attempted to preclude the class action by arguing the class includes 35 individuals from British Columbia and New Brunswick, provinces that haven’t recognized the tort of intrusion upon seclusion.

“The tort of intrusion upon seclusion has only recently been recognized by the Ontario Court of Appeal and is settled in Ontario. However, until the matter is ultimately decided at the Supreme Court of Canada, I find that the law in Canada is not settled on this issue,” wrote Smith.

“While the courts in British Columbia and New Brunswick have not as of yet recognized the tort of intrusion upon seclusion, I was not given case law to suggest that they have definitively shut the door on this cause of action.”

While Smith’s decision relied on a liberal analysis of privacy laws, Chiodo cautions against expecting the same results in other privacy breach cases as the facts in Evans were particularly favourable for the plaintiffs. She also says the certification doesn’t mean the court weighed the allegations on their merit.

“There was no finding of vicarious liability but a finding that there could be vicarious liability,” she says.

The ruling, she adds, “doesn’t really make substantial decisions in privacy law because it kind of kicks the can . . . further down the road and says, ‘This is a certification hearing. It’s not on the merits.’”

Still, Chiodo notes the decision is a slight expansion of the tort of intrusion upon seclusion established in Tsige.

In Tsige, the Ontario Court of Appeal capped the damages a judge can award under the tort of intrusion upon seclusion at $20,000. In that case, the plaintiff recovered $10,000. The lawyer for the plaintiff later sued her for not paying her legal tab.

Bach says it doesn’t follow that damages awarded in a class action under the new tort must be under $20,000. If the action in Evans succeeds, each class member may well collect the same amount of damages as the plaintiff in Tsige, he says.

The incentives for pursuing a claim under this tort are low given the cap on damages, according to Chiodo, but those who launch class actions are often looking for access to justice as well as “behaviour modification” by the defendants.


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