Supreme Court of Canada Rules that Commonality Requirement in Class Actions is Broader and more Flexible in Québec

On January 16, 2014, the Supreme Court of Canada (SCC) rendered its decision in Vivendi Canada Inc. v. Dell’Aniello, concluding that the commonality requirement in Québec civil procedure for the authorization of a class action is broader and more flexible than it is in the common law provinces. In a unanimous decision, the SCC ruled that it is not necessary that the common questions lead to common answers to meet this criterion. All that is needed is the existence of an identical, related or similar question of law that, once answered, will resolve a portion of the litigation. The SCC also confirmed that once the four criteria for the authorization of a class action in Québec are met, the authorization must be granted. The principle of proportionality must be considered when assessing the four authorization criteria and does not constitute a separate authorization criterion.

Background

The petitioner filed a motion for authorization to institute a class action following the unilateral amendments made by Vivendi S.A. (Vivendi) to its health care insurance plan (Plan), which it sponsored for its retirees and their eligible dependants. The contested amendments had the effect of reducing the health care coverage under the Plan.

The motion judge dismissed the motion for authorization on the basis that the commonality requirement was not met. The judge based his conclusion on the view that there were five subgroups of members in the proposed class and that the rights in regard to each subgroups were different. As a result, it would be necessary to proceed with different analyses to determine their various rights. The motion judge concluded that the rights of some proposed class members had not yet crystallized and that, since the members of the proposed class lived in different Canadian provinces, it would be necessary to analyze the claim based on the different applicable provincial laws.

The Court of Appeal reversed the motion judge’s decision and authorized the class action. The Court of Appeal held that the motion judge had erred in finding that the commonality requirement was not met. The determination of whether or not this criterion is met must be based on the questions at issue rather than on the factual differences that might apply to inquiries necessary to answer those questions. The Court of Appeal also stressed that the motion judge overstepped the boundaries when assessing the class members’ crystallization of rights issue, as it is an issue to be addressed on the merits.

Vivendi appealed this decision to the SCC.

The Commonality Requirement

The SCC examined the commonality requirement for the authorization of a class action in Québec pursuant to art. 1003(a) of the Code or Civil Procedure (CCP), which provides that "the recourses of the members raise identical, similar or related questions of law or fact", and made two observations. First, the SCC drew attention to the fact that this requirement refers to common questions rather than to common answers. Second, the SCC compared the commonality requirement in Québec with the requirements found in the various common law provinces’ legislation and concluded that this requirement is broader and more flexible in Québec since it requires the existence of identical, similar or related questions rather than "common issues". In the SCC’s view, not all questions of law or fact that are merely "related" or "similar" could be qualified as "common issues". Consequently, the SCC held that the test in Québec is less stringent than in the common law provinces.

Applying these principles on the interpretation of the commonality requirement in Québec, the SCC concluded that the motion judge had erred in his analysis and that this requirement was met since there are identical, similar or related questions in the claims with respect to the legality or validity of the amendments to the Plan.

The Principle of Proportionality

Vivendi argued that an interpretation of the commonality criteria that would allow the authorization of a class action whereby multiple substantive analyses would be necessary is contrary to the principle of proportionality recognized in Québec civil procedure at art. 4.2 CCP. The SCC rejected this approach and concluded that in a class action context, the authorization to institute a class action could not be refused on the basis of the principle of proportionality if the four criteria found at art. 1003 CCP are met. The SCC stated that this conclusion is supported by the fact that in enacting class action provisions, the Québec legislature did not require that a class action be the "preferable" mode of procedure. According to the SCC, the criteria set out at art. 1003 CCP are exhaustive. The principle of proportionality must be considered when assessing those criteria. However, once those criteria have been met, it is not possible to rely on the principle of proportionality to refuse authorization.

Conclusion

The SCC’s decision on the interpretation of art. 1003 (a) CPC is surprising. However, this interpretation of the commonality test should not be limited solely to Québec cases: it should also be read in the context of the very specific circumstances of this case. The fact that an answer could be given to the proposed common issue in a way that would advance the litigation for a significant portion of the group or sub-groups after a common issue trial was a determinant factor for the Court. This will not always be the case and there is still room to argue that not every proposed common issue in a given case would meet that test.   The plaintiff must still demonstrate that the common issue(s) trial will advance the litigation for the members of the class.