Will 2023 see a new trend in tort litigation in Canada? Class action and personal injury lawyers hope so: they are now marketing their services in the area of “mass torts” and “inventory litigation”. Similarly, the class action defence bar has suggested that “mass tort” litigation has arrived in Canada and is here to stay. Is this is simply a change in nomenclature or a substantive change in how claims actually be litigated?
“Mass torts” typically refers to civil litigation against one or several defendants arising out of the same or a similar act causing harm to multiple plaintiffs. Examples include harm allegedly caused by prescription drugs, medical devices, or defective consumer products, train accidents or plane crashes, and environmental contamination.
In Canada, these types of cases have historically been litigated by way of class actions. The reason is that the plaintiffs can more easily meet the test for class certification than in the U.S.: the bar is lower. Until recently, there was no requirement in any common law province to show that the common issues predominate over individual issues or that a class action would be the superior procedure. A plaintiff need only show that the pleadings disclose a cause of action, there is an identifiable class of two or more persons, the claims of the class members raise common issues, a class proceeding would be the preferable procedure and there is an appropriate representative plaintiff who meets certain statutory criteria. In Québec, the bar for class certification is even lower than in the common law provinces.
Ontario – Canada’s most populous province – has recently amended its class proceedings legislation to add predominance and superiority as mandatory considerations for the preferable procedure criterion. It is this new legislation - perhaps making it more difficult for plaintiffs to certify class actions grounded in tort – that portends the mass tort revolution.
Given the relatively lower standards for class certification in Canada, it is not surprising that class actions have been the vehicle of choice for the litigation of “mass tort” claims in Canada. The Canadian experience has thus in many ways been the opposite of the U.S. where “mass tort” claims involving personal injury are frequently litigated through what is sometimes called “inventory litigation” involving individual claims coordinated through federal multidistrict litigation (MDL) procedures.
Some have suggested that MDL-style litigation is taking root in Canada. Lawyers on both sides of the bar are now advertising themselves as experts in the field of “mass torts” including inventory litigation—either in addition to or as an alternative to class actions.
However, the Canadian experience with inventory litigation is limited and it is too soon to tell whether U.S.-style procedures will make their way to Canada or what form they will take. There are few examples of “inventory litigation” in Canada (e.g., cases involving allegedly defective breast implants, hernia mesh and over-the-counter heartburn medication). Furthermore, there are less than a handful of Canadian reported decisions touching on pre-trial and trial procedures for the resolution of such claims.
It is important to bear in mind that there are major differences in the court systems, constitutional structure and legislation that will preclude any wholesale adoption of the U.S. experience in Canada.
First, tort claims for personal injury are almost exclusively litigated in the Canadian superior courts, which are the equivalent of state courts in the U.S. but with judges appointed by the federal government (in most provinces, until age 75). By contrast, the Federal Court of Canada has a limited statutory jurisdiction and adjudicates almost exclusively in the area of patent, immigration and tax law. There is no concept of diversity jurisdiction in Canada that allows claims to be removed from the provincial superior courts and centralized and managed by a federal court. Rather, in tort claims involving an out-of-province defendant, there are common law and/or statutory tests to determine whether the provincial superior court has jurisdiction over the case and should exercise that jurisdiction in the event of a competing forum outside the province or country. Canadian courts have taken a liberal interpretation of these tests in the case of class actions and there are often multiple parallel class actions with overlapping or partially overlapping classes. It is unclear how courts will approach jurisdiction if inventory litigation of individual claims in different provinces becomes more common.
Second, there is no national legislation to coordinate claims involving common questions of fact in different provinces comparable to the MDL legislation in 28 U.S.C. 1407. The Canadian Bar Association has adopted a Canadian Judicial Protocol for the Management of Multi-Jurisdictional Class Actions which provides some procedural protocols and guidance to the judiciary and counsel in the case of parallel class actions in different provinces. However, there is no guidance for the coordination of “inventory litigation”. Case management rules dealing with discovery and pre-trial processes also vary from province to province and no national scheme exists for inventory litigation. There is also no bellwether trial selection process and the estoppel impact of any initial bellwether trials on other claims is untested. The lack of a legislative framework for inventory litigation also means there is a higher degree of uncertainty for defendants who may be unable to shelter under a class-wide release.
Third, Canada’s constitutional structure in Canada differs from the U.S. significantly for this type of litigation. The provinces have exclusive legislative jurisdiction over property and civil rights, matters of a purely local or private nature in each province and the administration of justice in the province including the constitution, maintenance, and organization of provincial courts. These provincial powers have been interpreted broadly and have been used to block federal legislative initiatives such as a national securities legislation. The powers bestowed on the provinces by the Canadian constitution could be invoked in the case of federal initiatives to try to coordinate mass tort claims across the country. In the current state of federal-provincial balance of power, it is questionable at best whether any federal initiative would prevail.
It remains to be seen whether there will be an increase in inventory litigation of mass tort claims in Canada. Litigation through individual claims presents both opportunities and challenges for plaintiffs and defendants compared to class actions, which have been the norm in Canada and likely still will be for years to come. For now, the management of inventory litigation will likely be left to the skill, ingenuity, and creativity of counsel, as well as the willingness of third party litigation funders to finance these initiatives. As inventory litigation becomes more common as an alternative or adjunct to class proceedings, it will be critically important for clients and counsel to investigate procedure and defences early and develop a comprehensive national litigation strategy.