A developing line of British Columbia certification decisions provides a strong basis to resist certification of consumer protection claims where the goods or services at issue are supplied to both businesses and consumers. Although the cases to date have played out in the context of British Columbia’s Business Practices and Consumer Protection Act (the BPCPA), the underlying principles are arguably applicable to Ontario’s Consumer Protection Act, as well as other provincial consumer protection statutes where “consumers” are defined by reference to the purpose of the transaction.
The most recent British Columbia decision denying certification of consumer protection claims is Webster v. Robbins Parking, a proposed class action challenging a private parking lot operator’s practice of issuing “violation notices” demanding payment where motorists parked in the operator’s lots without displaying a valid pre-paid parking ticket. Among other claims, the plaintiffs alleged that the “violation notices” were deceptive acts or practices contrary to the BPCPA.
The BC Supreme Court denied certification on various grounds, including that the claim of deceptive acts or practices under the BPCPA did not disclose a cause of action. Nonetheless, the court proceeded to consider whether or not the plaintiffs had proposed an identifiable class of two or more persons, which is one of the other requirements for class certification.
The court concluded that the members of the proposed class in Webster v. Robbins Parking were not capable of being identified because there were no objective criteria to determine whether the registered owner (as opposed to someone else) parked the vehicle or whether the individual who parked the vehicle did so for a “consumer purpose”.
In reaching this conclusion, the court noted that the BPCPA prohibits deceptive acts by “suppliers” only in the context of “consumer transactions”, which are defined to include the supply of services to a consumer for “primarily personal, family or household” purposes. The court followed previous decisions where proposed class definitions had been rejected because of the difficulties in distinguishing persons who purchased a good or service for a consumer purpose, as opposed to a business purpose. In so doing, the court also distinguished other BC cases where a proposed class of persons potentially having BPCPA claims was accepted, either because the customer’s purpose could be discerned from the defendant’s records or the contract at issue specifically prohibited customers from using the service for business purposes.
The argument made and accepted in Webster could be made in provinces where similarly legislative regimes have been adopted. In Ontario, for example, the Consumer Protection Act similarly defines “consumer” as “an individual acting for personal, family or household purposes and does not include a person who is acting for business purposes”. The availability of statutory causes of action under the Ontario CPA therefore depends on the individual’s “purpose” in transacting with a supplier.
Unlike the BC courts, however, the Ontario courts have to date been relatively unconcerned with the difficulties of distinguishing consumers from non-consumers in consumer protection class actions. In two cases that have briefly touched on the issue, the Ontario courts have suggested that the defendant’s records could identify whether services were purchased for business or personal use and that, in any event, the issue could be addressed during the claims administration phase.
Where class action claims are advanced under consumer protection legislation in respect of goods and services supplied to a mix of businesses and consumers, Webster v. Robbins Parking and related BC decisions support an argument against certification based on the difficulties of distinguishing “consumers”, as defined in the governing consumer protection legislation, from non-consumers. This argument appears most likely to succeed where the defendant’s records do not provide a reasonable basis for determining whether or not the customer is a consumer, and where the contract does not specifically contemplate that the good or service is only for personal or consumer use.