Ontario passes significant amendments to the Class Proceedings Act

Bill 161, the Smarter and Stronger Justice Act, 2020, passed through third reading of the Ontario legislature on July 7, taking the province one step closer to implementing the first major changes to the Class Proceedings Act (CPA) since the Act was passed more than 25 years ago. In addition to the CPA, Bill 161 makes changes to 17 other statutes as part of a collection of civil justice reforms introduced by Ontario’s Attorney General in early December 2019 (see Torys’ coverage of Bill 161 when it was first announced here).

Many of the amendments to the CPA reflect proposals by the Law Commission of Ontario following its comprehensive review of the Act released in July last year. However, some of the amendments, including changes to the certification test, were specifically considered and rejected by the LCO.

The most significant amendment to the CPA, which was considered and rejected by the LCO, is a change to the preferable procedure branch of the certification test. Under existing law, a court considers whether a class action or another procedure would achieve the principal goals of class actions, namely judicial economy, behaviour modification and access to justice. Bill 161 revises this approach, directing Ontario courts to find that a class proceeding is the “preferable procedure” only if, at a minimum:

1. it is superior to all reasonably available means of determining the entitlement of the class members to relief or addressing the impugned conduct of the defendant; and
2. the questions of fact or law common to the class members predominate over any questions affecting only individual class members.

This amendment signals a legislative direction for a more onerous test for certification. The language used adopts almost verbatim the predominance and superiority test set out in the rules for class action certification in the U.S. Federal Rules of Civil Procedure¹.

In addition to the change in the “preferable procedure” inquiry, Bill 161 contains other significant amendments to the CPA, including powers to deal with “multi-jurisdictional” class proceedings, carriage motions, and procedures for dismissing class proceedings for delay (see Torys’ coverage of these amendments here).

At the time Bill 161 was introduced, it was uncertain whether these proposed changes to the CPA (particularly the amendments to the preferable procedure test) would make it through the legislative process. However, in the end, after hearings before the Standing Committee on Justice Policy, almost all of the proposed amendments were included unchanged in the final version passed by the legislature. Apart from small technical wording changes, the only provisions to be revised following consideration by the Standing Committee related to the circumstances in which the costs of providing notice to class members could be paid to the representative plaintiff, and a change to the timing of a motion to approve a settlement that may involve subrogated claims.

Once the amendments are proclaimed into force, in addition to changing the “preferable procedure” test they will impact numerous aspects of class action practice and procedure in Ontario, including providing a mechanism to dismiss dormant proceedings and requiring the courts to consider the existence of class actions in other provinces when deciding whether to certify a proceeding. There are also other procedural changes including to the timing of summary judgment motions, appeal routes, carriage motions, collection of data on class actions, costs of certification notices, and the approval of settlements and third-party funding arrangements. Aside from the dismissal for delay provisions, these amendments will apply only to proceedings filed after the legislation comes into force. Our earlier bulletin provides more detail on each of these amendments.

Since nearly all the amendments only apply to cases that will be commenced in the future, it will likely be some time before the impact of these changes on both plaintiffs and defendants is fully understood.

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¹ Rule 23(b)(3) sets out the predominance and superiority test.

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