Publication
title
Constitutionality of Quebec Class Action Authorization Process Upheld by Appeal Court
DATE
May 19, 2005
EXPERTISE
On April 29, 2005, the Quebec Court of Appeal released a much anticipated judgment regarding class actions in Quebec. In Pharmascience inc. c. Option Consommateurs,[1] the Court upheld the constitutional validity of the legislative provisions governing the authorization of class actions in that province. The Court also expressed comments on other aspects of the class action proceeding which will likely influence the future conduct of class actions in Quebec.
The amendments to the Code of Civil Procedure which came into force on January 1, 2003 provide that a motion for authorization of a class action is no longer supported by a sworn statement, that it may only be contested orally and that the court may authorize the presentation of appropriate evidence at the hearing.[2] As a result of these amendments, the respondents are deprived of the opportunity to test the veracity of the facts alleged by the person who seeks the authorization to institute a class action. Moreover, the court may have to decide whether or not to authorize a class action without having the benefit of all the relevant evidence.
In rendering judgment, the Court of Appeal reiterated the guiding principles governing class actions in general, and the authorization process in particular. The Court stated that class actions are not exceptional proceedings but a social measure to promote access to justice in a context that ensures the balance of power between the parties. The authorization stage is a filtering and verification mechanism. According to the Court, the amendments which came into force on January 1, 2003 were specifically designed to put an end to the tendency of ruling on the merits of the cases at the authorization stage. The role of the Superior Court is limited to deciding whether the conditions set forth in Article 1003 of the Code of Civil Procedure have been met in order to protect the rights of absent class members. The court may authorize the presentation of appropriate evidence but, according to the Court of Appeal, evidence will not always be necessary (at para. 30). This way of proceeding is in keeping with the new philosophy of the Code of Civil Procedure which increases the judge's involvement in the management of cases.
The judge presiding over the authorization hearing must not decide on the appropriateness of the class action vehicle. This distinguishes the Quebec authorization process from the certification process in other provinces and in the United States. The Court emphasized this difference. Even if the Superior Court must ascertain whether the facts alleged appear to justify the conclusions sought, it should refrain from considering the merits of the case. The petitioners do not have the onus of proving the truth of their allegations. The fact that the class action raises complex issues or that the petitioners will clearly have difficulty proving their claims is not relevant at this stage. In this regard, the Court observed that the judge considering the motion for authorization cannot exclude questions that he believes are clearly unfounded, if some questions have a chance of success (para. 52) since there is no such thing as a motion for partial dismissal in Quebec. The fact that the authorization may have negative economic consequences for the respondents is not a relevant criterion in Quebec either.
Finally, the Court of Appeal held that the amendments to the Code of Civil Procedure do not deprive the respondent of his right to a full and fair hearing, which is enshrined in section 23 of the Charter of human rights and freedoms, R.S.Q., c. C-12. This is so because the authorization process does not concern the "determination of his rights and obligations" within the meaning of section 23. The sole purpose of the authorization process is to determine whether the petitioners should be given the mandate to sue the respondent on behalf of the members of the class, and to determine whether the conclusions sought by the petitioners flow logically from the facts alleged in the motion for authorization, which are assumed to be true at this stage. This process provides additional protection to the respondent who, under the ordinary rules of civil procedure, could be sued without any prior judicial authorization.
Following this judgment, all motions for authorization to institute class actions before the Superior Court, which had been suspended pending the Court of Appeal's ruling, will be reactivated. Counsel for the appellant Pharmascience have indicated that they intend to appeal the ruling before the Supreme Court of Canada.
The purpose of this document is to provide information as to developments in the law. It does not contain a full analysis of the law nor does it constitute an opinion of Ogilvy Renault or any member of the Firm on the points of law discussed.
[1]. 2005 QCCA 437.
[2]. Article 1002 C.C.P., as amended by the Act to reform the Code of Civil Procedure, S.Q. 2002, c. 7.
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