introduction

Justice Belobaba's decision in the common issues trial of Ramdath v George Brown College ("Ramdath"),1 currently under appeal, is one that should be monitored by defendants and their counsel. The outcome of this common issues trial, if upheld on appeal, may provide a "blueprint" for other plaintiffs to advance misrepresentation claims in the context of a class proceeding. Furthermore, this decision arguably broadens the scope of the Consumer Protection Act ("CPA"),2 which may encourage CPA claims in respect of a broader range of products and services in future.

facts

The plaintiffs were former students of the International Business Management Program (the "Program") offered by the defendant, George Brown College ("GBC"). The plaintiffs argued that GBC had made untrue representations in the Program's course calendar that upon successful completion of the Program, students would obtain three industry designations. In fact, GBC was never authorized to provide these designations, and upon successful completion of the program students would receive only a GBC Graduate Certificate. GBC argued that the course calendar accurately conveyed to students that the Program only prepared students to pursue these industry designations in the future, in the event the students chose to continue their studies.

the judgment

a claim for negligent misrepresentation is partially established

This judgment is significant because it is an example of how negligent misrepresentation claims will be handled at the common issues trial of a class proceeding.

Until now, it was unclear if negligent misrepresentation claims could be tried in a class proceeding. This is because the established five-part test for negligent misrepresentation includes a requirement that each plaintiff demonstrate individual reliance on the alleged misrepresentation. In a class proceeding, the focus of the common issues trial is on the resolution of issues of fact or law that are common to all class members. By definition, a common issues trial is unable to determine individual issues. The individual reliance requirement has meant that most courts have been unwilling to certify negligent misrepresentation as a common issue.

However, the plaintiffs in Ramdath crafted the common issues so that individual reliance was not one of the common issues advanced at certification. By doing so, the plaintiffs essentially split the elements of negligent misrepresentation between the common issues trial and the individual issues trial.

In the subsequent common issues trial, Justice Belobaba found GBC had negligently made untrue, inaccurate, or misleading representations to a group of students with whom GBC had a special relationship. The elements of the claim relating to individual reliance and damages were left to be determined at the individual issues phase of the litigation.

GBC breached the provisions of the CPA

In finding that GBC violated Part III of the CPA the Court found that the student plaintiffs were "consumers" under the CPA and that educational programs could be "consumer products." In coming to this conclusion, the Court considered whether or not the students, in taking these classes, were acting for "business purposes." Justice Belobaba found that a person is only acting for "business purposes" if that person is carrying on an existing business.3 It is not enough that the person is pursuing training or credentials for a potential future business. In the educational context, the Court drew a distinction between individuals enrolled in courses to assist in finding future work, and professionals enrolled in educational seminars relating to their existing business.4 As the latter were seeking training for existing business activities, they may not fall under the definition of "consumer" for the purpose of receiving CPA protection. However, students purchasing educational services in the hopes of obtaining future employment are undoubtedly "consumers" who can advance claims under the CPA.

implications of the judgment

This judgment provides plaintiffs' counsel with a blueprint for how to successfully advance a claim for negligent misrepresentation in the context of class proceedings. This development means that potential defendants may now be forced to contend with negligent misrepresentation claims on a mass scale. If so, damages trials will become more complex. This judgment also shows the courts' willingness to consider a broader range of services as falling under the CPA.

Defendants and their counsel will undoubtedly want to follow this decision to determine whether this it signals a development in the law in this area.

Joshua Chad