Conflicting Decisions on Whether Parallel Class Actions Constitute An Abuse of Process

April 16, 2015

Written By Ashley Paterson

Both cases were filed by the same law firm and concerned the same allegations related to system access fees charged to owners of cellular phones. Proposed class actions were filed in nine jurisdictions across Canada, including Nova Scotia, Alberta and Saskatchewan. A class action was certified in Saskatchewan and, as a result, the defendants in Nova Scotia and Alberta sought to strike out or stay the actions in those jurisdictions on the basis that it was an abuse of process due to the ongoing action in Saskatchewan.

In Alberta, Justice Rooke denied the application to permanently stay or strike the action. His reasons turned on his analysis of access to justice in the class action context. He noted that the proper administration of justice requires "that all litigants and class members have the right to full, not limited, access to the courts in their jurisdiction." The proposed class action in Alberta would be an "opt-out" class, meaning that class members would be automatically included in the class with the option to opt-out and pursue individual litigation if they so chose. By contrast, in order to participate in the Saskatchewan action, non-Saskatchewan residents would be required to take the active step of opting in. These findings caused Justice Rooke to conclude that opt-in provisions for non-residents are a significant detriment to the non-resident class members which, in certain circumstances will justify the multiplicity of proceedings.

Justice Rooke acknowledged that there was, at one point, an active national debate relating to the ongoing problem of overlapping and parallel class actions that he hoped his reasons would revive.

Indeed they may have. Justice Scanlan, writing for the Nova Scotia Court of Appeal just a month later, disagreed with Justice Rooke's analysis finding that it "is not consistent with the weight of jurisprudence and inevitably ignores the choices and actions of representative parties and their counsel." Further, that Justice Rooke's reasoning will "virtually always result in a multiplicity of actions where there is a perceived advantage to the residents of the province in which the motion is brought."

Justice Scanlan noted that the residents of any particular province do not have an absolute right to bring a proceeding in their own province since, if that were true, no plaintiff would ever lose a forum non conveniens motion in his own province. Justice Scanlan concluded that he would not follow Justice Rooke's reasons because he did not agree that the opt-in versus opt-out distinction trumps a proper abuse of process analysis. Needless to say, Justice Scanlan stayed the action in Nova Scotia. It may be necessary for the Supreme Court to resolve this debate for class action litigants and lawyers to have any certainty on the law in this area.

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