The February 14, 2011 decision of the Saskatchewan Court of Queen’s Bench in Thorpe v. Honda Canada, Inc., addresses a formal constitutional challenge to certification of multi-jurisdictional class actions. This is the first reported Canadian decision on this much-discussed issue.
In this class proceeding, the plaintiffs sought certification of a class of all persons who owned or leased 2006 and 2007 Honda Civic vehicles in Canada, alleging that the vehicles had defective suspension systems. Honda opposed certification based on the facts of the case, and challenged the constitutionality of ss. 6.1(1) and 6.1(2) of the Saskatchewan Class Actions Act, which confers upon Saskatchewan courts the ability to certify multi-jurisdictional class actions.
Honda argued that it was “constitutionally impermissible for a Saskatchewan court to make a ruling, which would have the effect of binding a resident in another province respecting a course of action that arose entirely within that other province.” This argument against certification of multi-jurisdictional class actions has been debated by many commentators including some of Canada’s most prominent constitutional scholars.
In rejecting Honda’s constitutional challenge and certifying a multi-jurisdictional class action, Justice Popescul held that the Saskatchewan Class Actions Act did not add or extend the powers of provincial courts, but rather confirmed the existence of an inherent power existing in superior courts at the time of Confederation. He concluded that the policy favouring access to justice supported the continuation of multi-jurisdictional class actions, and that accepting Honda’s arguments that the Saskatchewan Class Actions Act was unconstitutional would lead to extinguishing multi-jurisdictional class actions in Canada, which he called an “untenable” situation.
Justice Popescul went on to endorse the view that provincial courts have “unquestionable jurisdiction to adjudicate upon issues as between a representative plaintiff and [a defendant] by virtue of the fact that the representative plaintiff resides in this province and her cause of action arose here.” This theory, which has been articulated as the “real and substantial connection” between a litigant and a court in order for the court to assume jurisdiction to bind non-resident class members, has been much criticized.
This is very likely just the first of what will be a number of decisions to come on this issue. Given the importance of this issue not only for its constitutional principles but for class action litigation as well, it is likely that the issues raised by this decision will ultimately need to be resolved by the Supreme Court of Canada. In the meantime, the Canadian Bar Association has released for discussion a draft “Canadian Judicial Protocol for the Management of Multijurisdictional Class Actions.” More on this to come as the consultative process develops.