Yesterday, the Supreme Court of Canada (SCC) released its decision in Vivendi Canada Inc. v. Dell'Aniello, 2014 SCC 1 (Canlii), an appeal from a Quebec Court of Appeal (QCA) judgment overruling a judgment of the Quebec Superior Court (QSC) that dismissed a motion for authorization to institute a class action.  The QCA and the QSC had diverged in their assessment as to whether the commonality requirement had been met.

The SCC unanimously concluded that when considering the commonality requirement, courts do not need to determine whether the proposed common questions will lead to common answers.  The existence of one common question that can advance the resolution of the litigation with respect to all class members suffices. The SCC also reiterated and explained its decision in Marcotte v. Longueuil (City), [2009] 3 S.C.R. 65 with regards to the applicability of the proportionality principle in the context of a motion for authorization, indicating that proportionality must be considered when assessing each of the four criteria but emphasizing that the proportionality principle does not constitute a separate fifth criterion.

Background

This case followed Vivendi Canada Inc.'s unilateral amendment to the health insurance plan that it was sponsoring for its retirees and their surviving spouses in 2009. Mr. Dell'Aniello challenged the validity of the amendment and filed a motion for authorization to institute a class action on behalf of all the beneficiaries of the health insurance plan, including beneficiaries residing outside Quebec.

The QSC dismissed the certification motion based on the absence of commonality.  The QSC judge was of the opinion that too many factors specific to each member had to be considered for one or more of the questions to be decided collectively.  More specifically, the fact that the judge on the merits would have to conduct individual analyses regarding whether the right to insurance benefits during retirement had vested was deemed problematic by the QSC judge. Such analysis required the members to be divided into five subgroups, as different group members had different rights.  The judge also noted the lack of homogeneity of the proposed group's members, as they were located in six different provinces.  He found that this "range of individual recourses" prevented the requirement of art. 1003(a) C.C.P. from being met.

The QCA overruled the dismissal and found that there was at least one question common to the claims of all the members of the group: Whether the 2009 amendments were valid or lawful.  The QCA added that by focusing on the individual questions that could arise as a result of each Plan member's individual circumstances, the lower court judge had overstepped the bounds of his function at the authorization stage.  As a result, the QCA set aside the QSC judgment and authorized the class action.

SCC Decision

a) Commonality

At the authorization stage, the judge's role is limited to screening the Petitioner's application on the face of the allegations and the evidence adduced to ensure that defendants do not have to defend against untenable claims on the merits.  Petitioner's burden is one of demonstration, not proof on the balance of probabilities, that all criteria of art. 1003 C.C.P. are met.

With respect to commonality, the SCC held that the requirement set out in art. 1003(a) C.C.P. was applicable not only in Quebec, but also in all of the common law provinces of Canada.  As well, the SCC confirmed that its judgments in Western Canadian Shopping Centres Inc. v. Dutton, [2001] 2 S.C.R. 534 and Rumley v. British Columbia, [2001] 3 S.C.R. 184, which respectively stem from Alberta and BC and which establish a flexible approach to the commonality requirement, apply in Quebec.  These judgments provide that questions are to be considered common if they serve to advance the resolution of every class member's claim, even when such questions will require nuanced and varied answers based on the situations of individual members, so long as they do not give rise to conflicting interests among the members.

However, the SCC found that the commonality requirement set out in art. 1003(a) C.C.P. is less stringent than the "common issues" test applicable in the other common law provinces of Canada that have class action statutes as well the approach taken in the U.S.  As such, the SCC recognized that because of the differences in the wording of Quebec's legislation when compared with the legislation of the common law provinces, Quebec courts have favoured easier access to the class action vehicle by broadly interpreting and applying criteria of art. 1003 C.C.P.  

The SCC concluded that the commonality requirement set out in art. 1003 (a) C.C.P. is met when at least one of the questions raised is common.  The applicant has the burden of showing that an aspect of the case lends itself to a collective decision and provides for a resolution of a "more than insignificant" portion of the debate.   In fact, the common questions do not have to lead to common answers, and criterion (a) of art. 1003 C.C.P. is met even if the common questions will lead to uncommon answers for group members.  The SCC confirmed that the applicable threshold regarding common questions in Quebec to be low.

The SCC also added that the existence or need for subgroups does not constitute a sufficient basis for refusing to authorize a class action.  Different outcomes for different subgroups or different members of the subgroups does not necessarily imply that their interests are in conflict, as success for one subgroup or member does not automatically result in failure for another.

The SCC ultimately upheld the QCA decision and ruled that the motion judge erred by adding to the "commonality" criterion by inquiring into the possibility of whether the class action provided a common answer to the questions raised by the claims of all the members of the group.  The SCC also added that the physical location of the members of the group should not prevent the court from authorizing the class action when a common question that serves to advance the resolution of the litigation for all group members is identified.

b) The proportionality principle

The SCC also clarified the scope of the proportionality principle in the context of a motion for authorization.  Although the court must consider the proportionality principle set out in art. 4.2 C.C.P. when assessing the application of the four criteria of art. 1003 C.C.P., the proportionality of the class action is not a separate fifth criterion. 

The SCC explained that proportionality is simply a factor that must be considered by the motion judge when exercising his discretion in considering each of the four criteria of art. 1003 C.C.P.  However, the motion judge cannot rely on the proportionality principle to refuse to authorize an action that otherwise meets the established criteria.

Therefore, it is not necessary for Quebec courts, unlike those in other provinces, to consider whether the class action vehicle constitutes the most appropriate or the "preferable" procedure for the resolution of the dispute of the common issues.  If the four criteria are met, the class action must be authorized. 

c) Conclusion

In light of the applicable principles, the SCC ruled that the determination of whether the 2009 amendments to the health insurance plan are valid or lawful is a common question that could serve to advance the resolution of all the claims and thus meets the requirement of art. 1003 (a) C.C.P.  Consequently, given the existence of a common question in the present case, the SCC affirmed the judgment of the QCA, which authorized the commencement of class action proceedings as the other three criteria of art. 1003 C.C.P. were not in dispute.

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