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Bulletin

Class Actions: An Inappropriate Procedural Vehicle for Motions for Declaratory Judgments

Fasken
Reading Time 3 minute read
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Class Actions Bulletin

On May 14, 2020, the Supreme Court of Canada released its judgment in Lisa D’Amico, et al. v. Attorney General of Québec, 2020 CanLII 33847 (SCC), which dismissed the application for leave to appeal from the judgment of the Québec Court of Appeal, 2019 QCCA 1922. In this decision, the Court of Appeal dismissed the judgment of Justice Claude Allaire, 2018 QCCS 841, dismissing the application for authorization to institute a class action against the Attorney General of Québec and the Attorney General of Canada.

What are the facts in this case and why is this it worthy of your attention? 

The plaintiffs sought to have certain provisions of the Individual and Family Assistance Act (CQLR c A-13.1.1) and Individual and Family Assistance Regulation (CQLR c A-13.1.1, r.1) declared invalid; they also claimed compensatory and punitive damages.

The Court of Appeal did not uphold the reasons of the authorization judge concerning the proposed class representatives or the scope or relevancy of the proportionality rule of the Code of Civil Procedure, but they did uphold this key finding: the inadmissibility of an award of damages against the Crown in the absence of any allegation of fault marked by bad faith or abuse of power. Given that the claim for damages was inadmissible, the only issue left to be decided related to the unconstitutional character of the provisions of the law or the regulation.

The question that arose was whether a class action could therefore be authorized if it was in its reduced form purely declaratory in nature. The authorization judge decided in the negative, finding that a class action in such context would not be useful and inconsistent with proportionality rule as well as incompatible with the right of the members to opt out of a class action.

The Court of Appeal dismissed in part the authorization judge’s analysis, both with regard to the proportionality rule as well as the obstacle created by the opt-out mechanism. However, the Court upheld the reasons of the authorization judge in finding the class action would not to be useful in the circumstances. Considering this issue, however, from the perspective of article 575(3) of the Code of Civil Procedure which reads as follows:

575. The court authorizes the class action and appoints the class member it designates as representative plaintiff if it is of the opinion that

(…)

(3) to apply the rules for mandates to take part in judicial proceedings on behalf of others or for consolidation of proceedings; (…)

The Court of Appeal ruled that two of the procedural vehicles mentioned in article 575(3) are essentially examples and that a “teleological” or purposive interpretation, namely, one that takes into consideration the intention of the legislator, leads one to conclude that, at least implicitly, the Code contains the requirement that a class action can only be used if it serves a useful purpose. And the Court concluded that this could not apply in the case of a purely declaratory claim. Rather, in the absence of any other claim for pecuniary damages, there was no utility in using a class action to have the provisions of a law or regulation declared invalid.

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