In Red Seal Vacations Inc. v. Alves, the Saskatchewan Court of Appeal held that it is not necessary for the representative plaintiff to have a cause of action against each defendant in order to certify a class action proceeding. Justice Caldwell held that a defendant in a multi-defendant class action cannot have the claim struck under Rule 173(a) of The Queen’s Bench Rules simply because there is no named party plaintiff with a claim against the defendant.
Red Seal, the defendant, contended that Ontario’s position on this issue should be followed. They submit that Ragoonanan Estate v. Imperial Tobacco Canada Ltd. (2000), 51 O.R. (3d) 603 (Ont. Sup. Ct.) stands for the authority that for every named defendant in a proposed class action, there must be a party plaintiff with a cause of action against the defendant. However, the Saskatchewan Court of Appeal supported the position taken by the British Columbia Court of Appeal. According to Justice Caldwell, it is not “plain and obvious” that the claim against Red Seal cannot be certified because the statement of claim does not include a named plaintiff with a cause of action against Red Seal. An issue like this does not start as an “ordinary” action, but has special character from the beginning. Thus, it is not a pre-condition of certification that the representative plaintiff has a reasonable cause of action against each defendant. The Court of Appeal also rejected the policy argument that this will open the door for abuse by noting that class proceedings advanced on behalf of a class that does not exist will be prevented from being certified. Further, the costs that are awarded when a party engages in vexatious and frivolous lawsuits by unjustifiably naming defendants will serve as a deterrent against such behaviour.
October 18, 2011
Link to Decision
Kelly Ng
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