We have previously commented on the relatively low evidentiary threshold at the certification stage of class actions in Canada. The Federal Court of Appeal’s decision in Condon v Canada, a privacy class action, continues this theme as a recent example of Canadian courts’ liberal and purposive approach to class action certification.
Background: The Certification Requirement – A Reasonable Cause of Action
Among the criteria required to certify a class action is that the pleadings must disclose a reasonable cause of action. While a proposed plaintiff must provide sufficient evidence to show some factual basis for each of the other certification requirements, the same is not required to prove the existence of a cause of action. Rather, a pleading will be found to disclose a cause of action unless it is plain and obvious that no such claim exists.
Federal Court Partially Certifies Class Action
In July 2014, the Federal Court certified in part a class proceeding for damages arising out of the loss by the Ministry of Human Resources and Skills Development Canada of a hard drive containing personal information of 583,000 student loan recipients. Our post regarding the certification decision can be found here.
At the certification stage, the class action was allowed to proceed based on breach of contract and the tort of intrusion upon seclusion. The certification judge denied certification of the claims for breach of confidence and negligence, finding, based on a “summary review of the evidence”, that the plaintiff had not suffered any compensable damages, and therefore negligence and breach of confidence (both of which have damages as an essential element) could not be certified.
Appeal Allowed: Reasonable Cause of Action Not Determined By Evaluating Evidence on Certification Motion
Allowing the Appeal, the Federal Court of Appeal referred the matter back to the Federal Court to determine the common issues in the class action in relation to the claims for negligence and breach of confidence. The Federal Court of Appeal held that the certification judge erred in evaluating the affidavit evidence filed by the parties to determine the merits of the claims for negligence and breach of confidence. The Court reinforced that at the certification stage of class actions, the determination of whether pleadings disclose a reasonable cause of action is based on an assumption that the facts as pleaded are true, not on a review of evidence adduced in support of the motion.
Condon serves as a reminder of the proper purpose of evidence on certification motions, and reaffirms that the certification stage is not intended to be a test of the merits of a proposed class action.