Ontario civil | Class Actions
Class should not have been defined using arbitrary cut-off date
Plaintiffs commenced two class actions claiming that charitable lottery licensing and administration fees collected by appellant municipalities are direct taxes and therefore ultra vires. Proposed classes consisted of anyone who paid licensing fees on or after January 1, 1990. Certification judge initially certified class of charities that paid licensing fees in two time periods: (1) claims arising within two-year limitation period; and (2) claims preserved by transitional provisions of Limitations Act, 2002. Certification judge accepted municipalities' argument that claims falling outside these periods could not succeed because they were time-barred. Divisional Court allowed plaintiffs' appeal and remitted matter back to certification judge. Certification judge then certified both class actions using originally proposed commencement date, finding that impact of limitations issues should be dealt with later, rather than at certification stage, and that limitations issue did not make proceeding unmanageable. Divisional Court dismissed municipalities' appeal. Municipalities appealed further. Contentious common issues related to limitation periods. Municipalities argued that temporal scope of class was too wide. Appeal allowed in part. Class should not have been defined using arbitrary cut-off date. Municipalities proposed to limit claims to “timely” claims, but where resolution of limitation issue depends on factual inquiry, such as when plaintiff discovered or ought to have discovered claim, issue should not be decided on certification motion. Temporal boundary of class can be defined in rational way by reference to ultimate limitation period of 15 years. Concerns with respect to manageability can be addressed by creation of subclass for class members with presumptively time-barred claims. Common issues relating to liability, defences and remedies are common to all class members. Limitations issues are subclass common issues. Representative plaintiffs are able to represent all class members. Separate subclass representative may become imperative at later stage, but can be dealt with by case management judge. As modified, class proceeding is preferable procedure. Both liability and limitation period issues could be resolved relatively expeditiously. Although individual issues may remain after common issues resolved, this would not make proceeding unmanageable.
Amyotrophic Lateral Sclerosis Society of Essex County v. Windsor (City) (Aug. 12, 2015, Ont. C.A., G.R. Strathy C.J.O., H.S. LaForme J.A., and M. Tulloch J.A., File No. CA C59525, C59526) 256 A.C.W.S. (3d) 276.