EDITOR-IN-CHIEF: ELIOT N. KOLERS STIKEMAN ELLIOTT LLP Volume 9 Number 3 March 2015 IN THIS ISSUE FIGHT OR FLIGHT: SUMMARY JUDGMENT Most class actions result in settlements. OR SETTLEMENT IN CLASS ACTIONS However, with the Supreme Court of Canada’s recent ruling in Hryniak breathing new life nationally into summary judgment, class action counsel now have another tool at their disposal that may provide an effective means to bringing class actions to a cost-effective and timely resolution on the merits. Monique Jilesen and Julia Brown of Lenczner Slaght Royce Smith Griffin LLP consider the possible advantages of summary judgment and the risk of the settlement approval process in class actions………………....29 Monique Jilesen Julia Brown PARTNER ASSOCIATE Despite an unusual decrease in class LENCZNER SLAGHT ROYCE SMITH GRIFFIN LLP LENCZNER SLAGHT ROYCE SMITH GRIFFIN LLP action activity in Alberta this past year, a significant ruling emanating from the interplay between class actions and With a low threshold for certification, a defendant facing a class action third-party claims (and the tension has a number of tactical decisions to make from a cost, legal, and reputa- between them) was released. Michael Mestinsek, Brandon Mewhort and David tional perspective. In order to manage the cost and reputational issues, Price of Stikeman Elliott LLP analyze defendants have arguably too often been choosing to settle class actions the decision in Harrison v. XL Foods and that could have been successfully defended on the merits. The Supreme its possible impact, all within the context of the recent class action landscape in Court has recently breathed new life into another tool for defendants in Alberta…………………………………..35 class actions to consider—summary judgment.1 Rather than focusing one’s efforts on defending certification or achieving an early settlement, defendants can consider dealing with the action on its merits in a sum- mary judgment motion. CLASS ACTION DEFENCE QUARTERLY • Volume 9 • Number 3 Summary Judgment—A Merits-Based Class Action Defence Quarterly Final Adjudication Class Action Defence Quarterly is published four times per year The Supreme Court’s decision in Hryniak v. by LexisNexis Canada Inc., 123 Commerce Valley Drive East, Markham, Ont., L3T 7W8, and is available by subscription Mauldin [Hryniak] has changed the landscape for only. summary judgment motions in civil actions. In Web site: www.lexisnexis.ca Hryniak, the Supreme Court endorsed a cultural Subscribe to: [email protected] shift away from full trials and towards summary Design and compilation © LexisNexis Canada Inc. 2015. Unless otherwise stated, copyright in hearings where there is no genuine issue for trial.2 individual articles rests with the contributors. An emphasis on the need for adjudication to be ISBN 0-433-45401-6 ISSN 1911-2270 proportionate, timely, and affordable pervades the ISBN 0-433-45403-2 ISSN 1911-2289 judgment. ISBN 0-433-45406-7 (print & PDF) Subscription rates: $335.00 (print or PDF) It is axiomatic that one of the purposes of the Class $460.00 (print & PDF) 3 Proceeding Act, 1992 is to provide access to jus- 4 Editor-in-Chief: tice. Ontario judges urge upon the parties in class Eliot N. Kolers actions a reasonable and timely resolution of dis- Firm: Stikeman Elliott LLP Tel.: (416) 869-5637 putes. Justice Belobaba held in a series of costs E-mail: [email protected] awards that in the case of certification motions, LexisNexis Editor: “excess appears to be the norm in every aspect of Boris Roginsky LexisNexis Canada Inc. the process—in the time spent by legal counsel, the Tel.: (905) 479-2665 ext. 308 Fax: (905) 479-2826 volume of material filed with the court, the number E-mail: [email protected] of days scheduled for the oral hearing and the over- Advisory Board: litigation of most issues”.5 An early and summary The Honourable Warren K. Winkler, former Chief Justice adjudication of all or part of the claim through of Ontario • The Honourable Neil Wittmann, Chief Justice, Court of Queen’s Bench of Alberta • Kathryn Chalmers, summary judgment should address these issues of Stikeman Elliott LLP • Donald Chernichen, Burnet, concern to the court by providing for the considera- Duckworth & Palmer LLP • Craig Dennis, Dentons • Rodney L. Hayley, Lawson Lundell LLP / University of Victoria • tion of the claim on its merits rather than under the Marianne Ignacz, Norton Rose Fulbright Canada LLP • auspices of certification. Patricia Jackson, Torys LLP • Adrian C. Lang, BMO Financial Group • William L. (Mick) Ryan, Stewart Parties to class actions can and should consider re- McKelvey • Jean Saint-Onge, Lavery, de Billy LLP • Christine Mohr, Department of Justice, Ontario Regional sort to motions for summary judgment for a timely Office and cost-effective resolution of the dispute. As Note: This Quarterly solicits manuscripts for consideration by described by Justice Perell in Fehr v. Sun Life the Editor-in-Chief, who reserves the right to reject any manuscript or to publish it in revised form. The articles Assurance Co. of Canada [Fehr], either party might included in Class Action Defence Quarterly reflect the views of wish to “spare themselves the expense of the certi- the individual authors. This Quarterly is not intended to provide legal or other professional advice and readers should not act fication motion, lengthy and expensive examina- on the information contained in this Quarterly without seeking tions for discovery, and expensive pre-trial specific independent advice on the particular matters with which they are concerned. procedures when a procedurally fair merits-based 30 CLASS ACTION DEFENCE QUARTERLY • Volume 9 • Number 3 summary judgment motion can be structured before that province’s Summary Trial rule [Player].12 The certification”.6 proposed class alleged that the five corporate de- Since the release of Hryniak, several summary fendants manufactured fentanyl patches whose de- judgment motions have been brought in class action fective design resulted in serious harm to users. proceedings.7 In Fehr, Perell J. embraced the cul- Two defendants sought judgment through a sum- tural shift called for by the Supreme Court in mary trial on the basis that their patches were of a Hryniak, and based his order dismissing the plain- different design from those complained of by the tiff’s request for a further affidavit of documents, in plaintiffs. part, on that decision. He stated that Hryniak “de- In its lengthy decision the Supreme Court consid- mands a proportionate procedure”.8 Intuitively, ered expert evidence, as well as testimony by pro- cases that are amenable to certification ought to be posed class members, and determined that it was similarly amenable to a motion for summary judg- possible to find the necessary facts to decide the ment (on the part of the plaintiff or defendant), be- case on summary trial.13 The Supreme Court found cause the certification of common issues would that while pre-certification summary determina- suggest that the dispute could be resolved in a tions ought to be treated carefully, there was noth- summary manner without significant credibility ing to suggest that they were not appropriate in the issues or differing factual records.9 right case.14 In Magill v. Expedia, Inc.,10 the defendant on-line Motions for summary judgment in which a defend- travel company sought summary judgment of the ant enjoys partial success may also provide a sig- breach of contract class action on the merits. The nificant advantage to defendants, as these motions facts of the case were not in dispute. The defen- may narrow issues for trial and lead class counsel dant’s arguments were based on contractual inter- to reconsider what remains of the merits of the pretation. The case provides a good example of a case. successful motion for summary judgment brought Two recent cases illustrate the potential benefits of post-certification, finally disposing of the claims a motion for summary judgment. In 1250264 brought forward by the representative plaintiff. Ontario Inc. v. Pet Valu, the Superior Court al- Neither party had argued that it was not an appro- lowed the defendant’s motion for summary judg- priate case for summary judgment. Justice Perell ment on most of the seven common issues in a concluded that the evidentiary record before the certified class action.15 In supplementary reasons, Superior Court was more than adequate to decide Belobaba J. answered the two outstanding common 11 whether there were any genuine issues for a trial. issues largely in favour of the plaintiff. However, The Superior Court ultimately accepted the defend- given the narrow nature of the plaintiff’s remaining ant’s contractual interpretation, and the action was case, it appears that the damages corresponding to dismissed in its entirety. the plaintiff’s remaining claim could be determined Player v. Janssen-Ortho Inc., a recent case from the without the need for extensive submissions,16 great- British Columbia Supreme Court, is an example of ly reducing costs to the defendant, as compared a pre-certification summary determination under to a full-blown trial of the action. Looking at the •31 CLASS ACTION DEFENCE QUARTERLY • Volume 9 • Number 3 complex procedural history of the Pet Valu class cost and reputational issues, even in cases where action, with perfect hindsight, one might reconsider the merits of the claim are questionable. Most class whether a consent certification on agreed-upon actions settle,21 but it is urged upon defendants to common issues and an early motion for summary consider whether an early settlement is the best re- judgment might have ended up with the same re- sult that can be achieved. In considering the best sult, at lower cost to the parties.17 Of course, this route, defendants should consider that not all set- works only in hindsight, and counsel for the parties tlements will be approved and some settlement ap- could not have anticipated either the low bar for provals may prove to be more costly than any certification or the Supreme Court’s push for sum- benefit received as a result of the settlement.