The last quarter of 2024 saw a number of class action decisions addressing jurisdictional issues, including:
- The Supreme Court of Canada finding a single class action brought by one province on behalf of all other Canadian governments to be constitutionally valid;
- The Federal Court of Canada finding subject matter jurisdiction for civil remedies over an alleged anti-competitive agreement made outside of Canada impacting the Canadian market and
- The Ontario Superior Court of Justice accepting the rebuttal of presumptive jurisdiction for events that occurred at a Tanzanian mine indirectly controlled by a Canadian company with operations in Ontario.
Decisions this past quarter also set a high standard for reconsidering an unsuccessful certification decision; cautioned about pre-discovery summary judgment motions on factual issues; and offered guidance on what may qualify as a schedule for purposes of avoiding a dismissal for delay. As in previous quarters, Ontario courts also continue to part ways from those in British Columbia on the court's jurisdiction to hear causes of action under other provinces' privacy statutes.
Pan-Canadian Government Class Constitutional
Can multiple Canadian governments join in a single class action, in one province, before one province's superior court, without unconstitutionally sacrificing their autonomy or sovereignty? The Supreme Court of Canada said yes in Sanis Health Inc. v. British Columbia, 2024 SCC 40, holding section 11 of British Columbia's Opioid Damages and Health Care Costs Recovery Act ("ORA") constitutional, essentially because its purpose and effects were procedural in nature and other Canadian governments had the choice to allow their claims to be addressed in the British Columbia proceeding while their claims would still be determined in accordance with their respective substantive law.
In doing so, the Supreme Court affirmed that commonality of issues between a resident representative plaintiff and non-resident class members suffices to establish a real and substantial connection for adjudicative jurisdiction over the class (this having served the basis for a provincial court to preside over national class actions). Section 11 of the ORA was seen as an example of the important role that national class actions play in matters which span the country, by providing a mechanism to help multiple governments co-operate while working toward the same goal.
ORA
British Columbia's government commenced a proposed class action against various manufacturers, marketers and distributors of opioid products, alleging various common law torts and breaches of the Competition Act for allegedly contributing to opioid-related addictions, illnesses and deaths. British Columbia sought to certify a class comprised of all federal, provincial and territorial governments and agencies that paid health-care, pharmaceutical and treatment costs related to opioids. A few months after the commencement of that proceeding, the British Columbia legislature passed ORA. ORA created a direct, statutory cause of action, introduced new evidentiary rules and other procedural mechanisms in the litigation, and authorized British Columbia to bring an action on behalf of the class named in the proceeding while permitting a class member to opt out as provided under that province's Class Proceedings Act.
Constitutional Challenge
Several of the defendants applied for an order striking out the provision in ORA that authorizes British Columbia to bring an action on behalf of other Canadian governments challenging its constitutionality. Specifically, the defendants argued that section 11 of ORA did not respect constitutional territorial limits on provincial legislative competence and further undermined the sovereignty of other governments.
Legislative Competence
The Supreme Court of Canada (the "Court") approached the issue of legislative competence by first considering section 11's purpose and effect to characterize the provision within the constitution's division of powers. The Court found the provision's purpose was to provide a procedural mechanism through which the broader provisions in the ORA could apply to B.C.'s existing proposed class action, and not to create substantive rights for the B.C. Crown to engage in litigation under the Class Proceedings Act it could not otherwise do.
Likewise, section 11's effect was to procedural and not substantive rights of other governments. The Court noted that while participating in a class action involves some sacrifice of litigation autonomy, this does not mean that section 11 is a substantive provision or that its effects are an unconstitutional sacrifice of substantive rights. A Crown's choice to participate is an exercise of litigation autonomy. A class member, including a Crown, gains the benefits of a class action in exchange for the burdens, including sacrificing other elements of autonomy. But, even then, the Court observed that many aspects of litigation autonomy remain available through the procedural protections offered to non-representative plaintiffs within class proceedings (e.g., leave to participate as an intervener, application to replace a representative plaintiff, the ability to object to a proposed settlement). The Court added that the substantive rights of any foreign Crown who chooses to participate in the proceeding will still be determined in accordance with their own laws, which remain subject to change by their legislature, and its successor.
As section 11 of the ORA was procedural in its purpose and its effects, the Court held it is properly classified under the authority of each province to legislate in relation to the administration of justice in the province under subsection 92(14) of the Constitution Act, 1867.
Legislative Sovereignty
In considering whether ORA's section 11 respects the territorial limits under section 92 of the Constitution Act, 1867, the Court further addressed whether section 11 has a meaningful connection to British Columbia, as the enacting province, while respecting the legislative sovereignty of other Canadian legislatures.
The defendants argued that there was no meaningful connection as section 11 enables a class action where the substantive claims of foreign Crowns, for alleged wrongs occurring in foreign provinces and territories, according to foreign law, will be prosecuted by the government of British Columbia and decided by a British Columbia court. The Supreme Court rejected this argument by noting that courts have long endorsed the idea that the common issues shared between the non-resident class members and the resident representative plaintiff suffice to establish a real and substantial connection with the jurisdiction. It added that accepting the defendants' argument would "contradict decades of established jurisprudence affirming that superior courts can preside over class actions that are national in scope."
Lastly, on the question of whether ORA's section 11 respects the legislative sovereignty of other Canadian governments, the Court noted the distinction between legislative and executive authority. The legislature of one level of government cannot transfer its authority to legislate to another government. But no such rule applies to the executive delegation of...
