Problem for defendants responding to basically similar proposed class motion lawsuits – litigation, mediation, and arbitration

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Difficulty for defendants responding to essentially identical proposed class actions

February 25, 2021

McCarthy Tétrault LLP

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Britton v Ford Motor Company of Canada, 2021 ABQB 17, shows that essentially similar class action lawsuits in different Canadian jurisdictions can be a headache for the defendants as Canada does not have a national structure to administer them. The case also shows the sometimes slower pace of litigation in Canada (on average) compared to other jurisdictions, particularly the United States.

The case related to alleged engine failures. In 2012, the Merchant Law Group (MLG) filed a proposed national class action lawsuit in Saskatchewan. Kevin Whittal was the proposed representative plaintiff. The Saskatchewan campaign has been inactive and no certification hearing was planned until 2020.

Mr Britton – also represented by MLG – filed a substantially identical lawsuit in Alberta in 2019 because the lawsuit in Saskatchewan was delayed. The defendants moved to suspend the lawsuit in Alberta as an abuse of process because the lawsuits were essentially identical and administered by the same plaintiff firm – Mr. Whittal and Mr. Britton even worked together on some issues.

However, regarding precedents from across Canada, the court ruled that competing proposed national class actions are not inherent or allegedly abusive. As the court found, there is no Canadian national class action lawsuit coordinating process in the US that compares to a multi-district litigation. Therefore, overlapping and competing actions are common, and even substantially identical actions are difficult to manage.

Defendants who seek to remain one of several competing proposed class actions must also demonstrate that they are not serving a legitimate purpose. In this case, the defendants failed in their attempt to reverse this obligation.

MLG nevertheless attempted to justify the lawsuit on the grounds that (i) the delays in Saskatchewan and (ii) the statute of limitations in Alberta would be maintained. The court ruled that the initial justification was unsatisfactory as it was intended to discourage similar actions by the same party – MLG had a significant impact on the progress of the Saskatchewan lawsuit and plaintiffs were cooperative.

Regarding statute of limitations, the court ruled that “sometimes it is better to bring a lawsuit later than never” (para. 29), even though the lawsuit was filed in Alberta many years after the vehicles were manufactured and Mr. Britton apparently learned of the alleged defect .

Ultimately, the court preferred to deal with limitation periods on certification and so declined to stay. Alberta’s Class Proceedings Act requires the court to consider whether it is preferable that the proposed common issues be resolved in resolving a certification application in a competing class action lawsuit. The court ordered the parties to consider the statute of limitations issues and the implications of possible Alberta-Saskatchewan coordination in this regard. The court concluded that MLG had been warned of a substantive proposal to address the parallel certification measures.

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The content of this article is intended to provide general guidance on the subject. You should seek advice from a professional about your particular circumstances.

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